Aquestive Therapeutics, Inc. Stock

Good day, and thank you for standing by. Welcome to the Q3 2026 Aquestive Therapeutics, Inc. Earnings Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded. I would now like to hand the conference over to your first speaker today, Faith Pomeroy-Ward from Aquestive.

Thank you, operator. Good morning, and welcome to today's call. On today's call, I'm joined by Dan Barber, President and Chief Executive Officer; and Ernie Toth, Chief Financial Officer, who are going to provide an overview of the company's reported financial results for the third quarter ended September 30, 2026, and a business update on recent developments, followed by a Q&A session. During the Q&A session, the team will be joined by Dr. Matt Greenhawt, Chief Medical Officer; Melina Cioffi, Senior Vice President, Regulatory Affairs; Sherry Korczynski, Chief Commercial Officer; and Dr. Matthew Davis, Chief Development Officer.

As a reminder, the company's remarks today correspond with the earnings release that was issued after market closed yesterday. In addition, a recording of today's call and related supplemental materials will be made available on Aquestive's website within the Investors section shortly following the conclusion of this call. To remind you, the Aquestive team will be discussing some non-GAAP financial measures this morning as part of its review of third quarter 2026 results. A description of these measures, along with a reconciliation to GAAP, can be found in the earnings release issued yesterday, which is posted on the Investors section of Aquestive's website.

During the call, the company will be making forward-looking statements. We remind you of the company's safe harbor language as outlined in yesterday's earnings release as well as the risks and uncertainties affecting the company as described in the Risk Factors section and in other sections included in the company's annual report on Form 10-K filed with the U.S. Securities and Exchange Commission on March 4, 2026, and in its subsequent quarterly reports on Form 10-Q and current reports on Form 8-K. As with any pharmaceutical company with product candidates under development and products being commercialized, there are significant risks and uncertainties with respect to the company's business and the development, regulatory approval and commercialization of its products and other matters related to operations.

Given these uncertainties, you should not place undue reliance on these forward-looking statements, which speak only as of the date made. Actual results may differ materially from these statements. All forward-looking statements attributable to Aquestive or any person acting on its behalf are expressly qualified in their entirety by this cautionary statement and the cautionary statements contained in the earnings release issued yesterday. The company assumes no obligation to update its forward-looking statements or outlook or guidance after the date of this conference call, whether as a result of new information, future events or otherwise, except as required under applicable law.

Now I would like to turn the call over to Dan.

Good morning, and thank you for joining us today. This morning, I am pleased to tell you that we continue to execute right on schedule. In March, I told you that we would resubmit our Anaphylm epinephrine sublingual film application before the end of the third quarter, and we did. I also told you that we would out-license Libervant diazepam buccal film rather than launch it ourselves, and we did. I told you that we would refinance our debt before principal payments became due in June, and we did. I told you we expected to have $70 million or more of cash and cash equivalents at year-end, and I'm pleased to tell you that we now expect to end the year with more than $70 million in cash and cash equivalents.

In fact, as we sit here today, we are right where we expected to be. Our lead asset, Anaphylm, is under review with the FDA and has an assigned goal date that is only 132 days away or if you are an investor, since this is our earnings call, only 88 trading days. We are now focused on the next set of deliverables in our execution story. Our organization is ramping up for the U.S. launch of Anaphylm following FDA approval, and we are now hiring our district sales managers. We expect to file Anaphylm in Canada before the end of the year, and we are on track to file in Europe in the first quarter of next year. Our ex-U.S. licensing activities also continue, and we expect to have more to say in the months to come.

Now let's talk more about Anaphylm in the U.S. Everywhere I go and everyone I talk to in the allergy community can align behind one important concept. When a person is having a severe allergic reaction, the only thing they care about is making it stop as fast as possible. That's it. And that's where we believe Anaphylm will shine if approved by the FDA. Stopping a severe allergic reaction is a function of many things, including having a rescue product with you, using a rescue product without hesitation and having your symptoms abate quickly. That is why we believe speed is the ultimate differentiator, and we will continue to focus on this as we interact with the allergy community.

Our presentations at the upcoming American College of Allergy, Asthma and Immunology in Phoenix this month will highlight these views. This is also why I continue to see the opportunity for Anaphylm as significant. I continue to believe the market will transition from auto-injectors to new and improved technologies like Anaphylm. The market remains large and growing. We expect the overall U.S. market for epinephrine products measured by total prescriptions to once again grow year-over-year in 2027, and we see plenty of opportunity for continued market growth in the years to come. From a development standpoint, we are answering the FDA's information requests as we receive them and we'll continue to do so. At this time, we have nothing new to report on the review.

In terms of timing, while the FDA has assigned a 6-month review period, we remain prepared and hopeful for the possibility of an earlier decision. However, we do not control the FDA's time lines or how they prioritize their workload. Therefore, we are keeping our expectations on receiving its decision by March 16, 2027. In terms of expectations, we recognize that our story in 2027 will be one of execution. As we look towards a spring launch of Anaphylm, if approved by the FDA, I'd like to outline for you how we will judge success in 2027. In other words, what are the green shoots to look for in 2027.

First, we are determined to show ongoing progress with payers by both percentage of covered lives and quality of coverage. We will update you as these happen. We have engaged in the pre-approval information exchange or PIE discussions with the top 4 PBMs in the country, along with many downstream plans, and we'll continue to advance productive dialogue as much as possible prior to approval. Second, we want to see uptake in the places where we show up. Post launch, we will provide you with a view of our progress among the physicians our sales reps are calling on. This is a place we must show progress. Third, we will track the efficiency of our spending. How many dollars are we spending versus the uptake we see. This will be an important measure as we look to scale our launch quarter-by-quarter.

Now let's briefly talk about Libervant. We are excited to have out-licensed Libervant diazepam buccal film to Eton Pharmaceuticals. We have waited a long time for Libervant to be available to patients, and we expect this to finally come to fruition in 2027, if approved. We believe Eton is the right commercial team to launch Libervant, and we look forward to working with them in 2027 and beyond. While Libervant is not central to our growth story, it is an important product for patients and could also be an important cash contributor to the company.

Now let's turn to the pipeline. Long term, our goal is to become the leading provider of cutting-edge medications for patients who need to control their immune responses. We intend to do this through not only becoming a full-fledged commercial organization with deep expertise in allergy, dermatology and pulmonology, but also through building a new pipeline of development assets. We see 2027 as a pivotal year for our AdrenaVerse pipeline. In 2027, we would like to provide meaningful clinical data on AQST-108 for atopic dermatitis as well as bring additional AdrenaVerse-driven indications through proof of concept, utilizing our library of epinephrine prodrugs.

Now that our development team has resubmitted the Anaphylm application in the U.S., we expect to focus more energy on these efforts. So if you look at where we're going, there's a lot to be excited about. We are only a few months away from our FDA goal date for Anaphylm. We are expanding into ex-U.S. territories. We have managed our cash tightly and remain on track to fund Anaphylm's launch, if approved, and we will have more focus on our pipeline as we move into 2027. With that, I will turn the call over to Ernie.

Thank you, Dan, and good morning, everyone. By now, you will have seen our third quarter 2026 financial results in the earnings release issued last evening and detailed in our Form 10-Q. As we typically do, we will address most of the detailed discussion during our Q&A. I will focus my remarks on our financial performance, operating expenses and the disciplined capital allocation that supports our next phase of execution.

As Dan outlined, we continue to execute against the commitments we made at the beginning of the year. We resubmitted the Anaphylm application before the end of the third quarter. We completed the Libervant licensing transaction. We refinanced our debt in May before scheduled principal payments under the prior notes would have begun. And through disciplined management of our spending and liquidity, we now expect to end 2026 with more than $70 million in cash and cash equivalents.

We believe our existing liquidity, together with potential access to additional capital under the RTW and Oaktree agreements if Anaphylm is approved and other applicable conditions are satisfied, positions us to support launch readiness and initial commercialization activities for Anaphylm, if approved, while continuing to advance our pipeline. Before turning to the quarter, I want to briefly highlight the financial aspects of our recently announced Libervant transaction with Eton Pharmaceuticals.

Under the agreement, Eton received exclusive U.S. rights to commercialize Libervant, subject to applicable regulatory approvals. We received a $10 million upfront payment and are eligible to receive up to an additional $47.5 million in contingent regulatory and commercial milestone payments. We will also receive a mid-teens royalty on annual U.S. net sales of Libervant. Importantly, Aquestive will remain the exclusive manufacturer and supplier of Libervant to Eton under a long-term supply agreement.

So in addition to the upfront payment, potential milestones and royalties, the transaction preserves an ongoing manufacturing relationship around the product. We believe this is a capital-efficient structure for Aquestive. It places responsibility for U.S. commercialization with Eton while allowing us to participate in the product's future value and remain focused on our primary commercial priority, the potential launch of Anaphylm.

Now let me begin with revenue. Total revenue was $7.6 million in the third quarter of 2026 compared with $12.8 million in the third quarter of 2025. This decrease was primarily driven by the quarterly fluctuation of Suboxone product orders. Manufacture and supply revenue was $6.7 million in the third quarter compared with $11.5 million in the prior year period. This primarily reflects lower Suboxone revenue, partially offset by higher Ondif revenue. License and royalty revenue was $0.8 million in the third quarter compared to $1 million in the third quarter of 2025, primarily reflecting lower royalty revenue received during the period. Co-development and research fees were approximately $0.1 million compared with approximately $0.3 million in the prior period.

For the first 9 months of 2026, total revenue increased 14% to $35.8 million compared with $31.5 million for the same period in 2025. This increase was primarily driven by higher license and royalty revenue, including $5 million of Zevra-related royalty revenue, partially offset by lower manufacturing and supply revenue and lower co-development and research fees. Manufacture and supply revenue for the first 9 months was $27.4 million compared with $28.2 million in the prior year period. License and royalty revenue increased to $7.5 million from $2.7 million, primarily due to royalty revenue from Zevra.

Turning to operating expenses. Our results reflect the deliberate choices we have made as we prepare for a potential Anaphylm launch while continuing to manage our overall spending carefully. Research and development expenses were $4.3 million in the third quarter compared with $4.5 million in the third quarter of 2025. This decrease primarily reflects lower share-based compensation, partially offset by higher clinical trial costs associated with the human factors validation study and the pharmacokinetic study completed for the Anaphylm NDA resubmission. For the first 9 months of 2026, research and development expenses decreased $12.4 million from $14 million in the prior year period. This decrease primarily reflects lower product research expenses associated with the Anaphylm program and lower share-based compensation, partially offset by higher personnel costs.

Selling, general and administrative expenses were $14.2 million in the third quarter compared with $15.3 million in the prior year period. The year-over-year decrease primarily reflects approximately $1.5 million of lower legal fees, approximately $1.4 million of lower commercial spending and approximately $0.6 million of lower Anaphylm-related regulatory expenses. These decreases were partially offset by higher personnel costs, share-based compensation and consulting and outside services expenses.

For the first 9 months of 2026, selling, general and administrative expenses decreased to $39.2 million from $47 million in the first 9 months of 2025. The decrease primarily reflects approximately $6.1 million of lower commercial spending, the absence of the $4.3 million onetime Anaphylm PDUFA fee incurred in the prior year period, approximately $2.8 million of lower legal fees, approximately $1.5 million of lower regulatory and licensing fees related to Libervant and approximately $1 million of lower Anaphylm-related regulatory expenses. These decreases were partially offset by higher personnel costs, severance costs, share-based compensation and consulting and outside services expenses.

Turning to the bottom line. Our net loss for the third quarter of 2026 was $16.5 million or $0.13 per basic and diluted share. This compares with a net loss of $15.4 million or $0.14 per basic and diluted share in the third quarter of 2025. For the first 9 months of 2026, our net loss was $47.4 million or $0.38 per basic and diluted share compared with a net loss of $51.9 million or $0.51 per basic and diluted share for the same period in 2025. Just a reminder, the 2026 year-to-date results include a onetime loss on the extinguishment of debt of $11.7 million related to the repayment of our 13.5% notes. Excluding that onetime item, our net loss for the first 9 months of 2026 was $35.7 million.

Non-GAAP adjusted EBITDA loss was $12.2 million in the third quarter of 2026 compared with a non-GAAP adjusted EBITDA loss of $8.6 million in the third quarter of 2025. For the first 9 months of 2026, non-GAAP adjusted EBITDA loss narrowed to $19.2 million compared with a non-GAAP adjusted EBITDA loss of $35.5 million in the prior year period. Please refer to the reconciliation of net loss to non-GAAP adjusted EBITDA loss included in our earnings release.

Let me finish with liquidity and capital allocation. We had $90.3 million in cash and cash equivalents at September 30, 2026. This amount does not include the $10 million upfront license fee received from Eton in October in connection with the Libervant transaction. As Dan noted, we have managed our cash tightly and expect to finish 2026 with more than $70 million in cash and cash equivalents. This expectation includes the $10 million Eton upfront license fee received in October and does not assume receipt of the contingent RTW or Oaktree funding.

If Anaphylm receives FDA approval by the applicable deadline and we satisfy the other conditions under the relevant agreements, we expect to have access to $75 million under the RTW strategic funding agreement and an additional $20 million under the Oaktree term loan facility. Together with our existing liquidity, we believe these sources would support launch preparation and initial commercialization activities for Anaphylm, if approved, while allowing selective investment in our development pipeline.

We are maintaining our full year 2026 financial guidance. For 2026, the company continues to expect total revenue of $46 million to $50 million and non-GAAP adjusted EBITDA loss of $35 million to $30 million.

Looking ahead, our capital allocation priorities are clear. First, we will fund the activities necessary to maintain launch readiness and prepare for the potential U.S. commercialization of Anaphylm if approved. Second, we will continue to support the medical, regulatory, market access and payer work needed to prepare for commercialization following potential approval and to advance our regulatory strategy outside the United States. Third, we will invest selectively in the AdrenaVerse pipeline with an emphasis on the programs that we believe have the potential to generate meaningful clinical data and create long-term value. And finally, we will continue to manage our liquidity and capital carefully as we advance these priorities.

With that, I will now turn the call back to the operator to open the line for questions.

[Operator Instructions] Our first question comes from the line of Roanna Ruiz of Leerink Partners.

So a couple for me. First is with the upcoming PDUFA for Anaphylm, could you give us an update of what commercial initiatives you plan to use out of the gate? And generally, what the overall split could be between digital advertising, prescriber targeting and other field rep initiatives?

Sure. Roanna, did you have a second question or that was the question you wanted to put out?

That was the first one. The second one, I did have a question about pre-approval info exchange with the PBMs. How much does that sort of coverage discussions? And can you give us a little color around that?

Sure. Absolutely. I appreciate that you instantly went to, of course, where our focus is on the commercial launch. Look, we feel great right now. We feel like we've managed our cash. We've got a strong cash position. We've maintained guidance. We're under review. Sherry and her team are preparing for launch. So you're absolutely right that the commercial initiatives are a place of focus. And Sherry is right here with me, and I'll let her walk you through the digital advertising and sales thoughts she has.

Thanks again for the question. We're so excited here. When you think about it, never has a product offered what Anaphylm will offer to both the allergist community as well as the caregivers and patients. It's truly a 360-degree approach to anaphylaxis management that has never been done before. And so it is critically important for us as we are completing the build of our senior staff, our district sales managers, our sales training, our supply chain is all ready to go. And as you know, it's based in the U.S. We are working diligently to prepare for the sales force and those nonpersonal promotion efforts.

While I'm not going to get into the details as far as percent of split as far as spend, as we've mentioned before, the allergists are key, and we will have approximately 75 representatives calling on around 8,000 customers. These are the top-tier allergists, some pediatricians and otolaryngologists. So we know and absolutely believe that surround -- having surround sound with those key customer targets is very, very important. So not only will our sales representatives be addressing, our medical colleagues are out at conferences, and they will continue to be out and with the allergists to continue to drive our message around our clinical efficacy as well as the other key benefits of the product. Being -- it's so easy to carry, it's very easy to use.

So you will see a nice split, Roanna, amongst the marketing initiatives and those sales force initiatives. If the deep question is really, are we going to be launching into TV and things like that, there will be a time and a place for major DTC efforts. As Dan has mentioned, we plan to be efficient with our spend. And as we see those opportunities, we'll begin to invest further.

So let me -- Roanna, take the second question, which was around the pre-approval PBM interactions. These are -- and what I believe your question was what's the extent of what you can do there. These are really important engagements and tying into what Sherry just outlined, we feel very strongly that the opportunity in this space is to bring health care providers and patients back to the clinical data. The auto-injector has been the de facto leader for 45 years because it's the only thing out there, not because the data is the reason for that product.

So we have an opportunity in our pre-approval interactions with the PBMs to show them our data. And I'm very fortunate to work with a great team, including Melina Cioffi and Dr. Matt Greenhawt, who are here with me this morning, who will walk that clinical data with our PBMs and really show them why we think we're differentiated. So we're not -- we understand that the dance to get to contracting is a difficult one for any pharmaceutical company. However, we do believe that, that clinical data can lead the way for us as we move forward.

Our next question comes from the line of Kristen Kluska of Cantor Fitzgerald.

Congrats on the resubmission acceptance. Two questions for me. The first is when you received that acceptance, did you get any word or comments about whether the FDA would kind of be reviewing everything from scratch or really the key focus is on the new data and information that you've shared since? And then the second question is, I'm just curious, this past year has given you more time and you've obviously collected more data as a company. What would you say has changed the most in terms of your expectations on what this launch or product could look like versus where you were at a year before you had done these additional studies and work?

Thanks, Kristen. So in terms of the acceptance -- I'll turn it over to Melina in a second, and she can walk you through her thoughts. I will say this with the FDA. We've obviously been -- we think appropriately vocal is the way I would put it, that this is a pretty limited package. And we believe there's an opportunity, especially with where the FDA is publicly talking about speed of review and transparency and all of the things they want to do. We do believe there's an opportunity for a faster review here. We don't control that. So that's completely up to them. But I want to make sure everyone knows that we are advocating for that and doing it appropriately, we believe. But I'll let Melina give you her thoughts.

Sure. So in terms of the focus of the review in the context of a resubmission, the focus is simply the complete response items that were outlined in the complete response letter. So when we hear from the agency in terms of the acceptance of the submission, they are informing us that our response is complete to facilitate their review. And the focus of that review will be strictly or intended to be strictly on the resubmission scope. So I hope that gives a little bit of clarity in terms of the scope of the data that will be reviewed consistent with what Dan had mentioned.

Thanks, Melina. So I will let Sherry give you some thoughts on learnings in a second here, but I just want to give in my mind, what I think is the most important learning and I'll go back to Dr. Matt Greenhawt joining us in February. And I don't know that this is due necessarily to having to deal with the packaging CRL that we're having to deal with, but more from what's important to allergists. And I think Matt has really championed in our company that the clinical data we have is really compelling.

And so that's why you've heard us, if you go back through what we talk about on these calls over the last 4 to 6 quarters, we've really moved from this idea of, okay, we have interesting PK comparison data to let's really talk about the pharmacodynamic data and what it means to patients. And you heard in my prepared remarks, we really do understand and believe the only thing a patient cares about is that their severe allergic reaction stops. And that is about the pharmacodynamic measures that we have, not necessarily PK comparisons. But I know Sherry has a lot of thoughts as well, so I'll let her add on hers.

No. Just to really add on to Dan is what has changed the most in the last year, Kristen. What I would say is with bringing Matt on and really like having great deep understanding of this PD data, we have so much confidence in the differentiation Anaphylm has for patients and caregivers. And so what I would say is we have to lean into the importance of trust and confidence. And so one of the key learnings that we've had is do patients feel that they have to carry multiple devices. Some do. Are physicians really confident in the data of the other -- the newer products.

And so for us, our ability to lean into the data into having physicians and caregivers, patients alike trust and be confident that Anaphylm is going to work in an emergency rescue situation. That is first and foremost. Look, the fact that we can carry it on the back of our phones, that it is very durable, that it's easy to use, that's all icing on the cake. We really truly believe that Anaphylm delivers confidence. It's carried differently. So I would say, overall, that is our biggest learning in the last year, Kristen.

Our next question comes from the line of David Amsellem of Piper Sandler.

So two for me. First, in terms of the commercial launch and also your access initiatives, can you talk about what you're going to do differently relative to ARS and its experience with neffy, both in terms of physician targeting, promotion and access strategy. I'd love to hear how you're taking learnings from their experience and applying it to Anaphylm. So that's number one.

And then secondly, on the AdrenaVerse platform, I know that you've talked about being judicious about spend on the programs here. But as you think about atopic derm and that development program, -- can you give us a little insight into what other potential indications you can see yourself moving into for the platform and what you're going to prioritize over time beyond AD?

Thanks, David. Great to hear your voice. So I would say -- and I'm going to hand it over to Sherry in a second here to talk about targeting and promotion in particular. I would say the focus as a global comment, the focus that we'll bring of where the place to start our story in this community is probably the #1 thing that compared to anyone who's come out in the past years, you'll see from us. But I'll let Sherry give you her thoughts.

David, yes, thanks so much for the question. As it relates to -- we've discussed a lot about what our learnings over time from the device, the nasal device launch. What I will share again is our strategy is around depth in the allergists and high prescribing epinephrine writers community. And so we are going with a very targeted approach at about 8,000 to 8,500 key targets. And our sales team will be very focused on all the execution. Seeing the right targets with the right frequency and providing them with the right resources in order for them to have the confidence that Anaphylm will work in a rescue situation and a patient, quite frankly, will have it on them in the event that such a situation occurs. So I do see that as our launch as compared to the other launch, that is a difference.

From a promotion perspective, we talk about, again, we have a -- our value proposition is not based around just one thing. It is not a singular value prop. Our value prop is focused on efficacy to drive trust and confidence for the prescriber and their patients and caregivers. It's around the ease of carring and always having with you should an allergic reaction occur and then the ease of use and durability of the product. So we do believe from a promotion perspective that all of our promotional materials, our NPP, our -- the work that we're going to be -- that we're doing currently in marketing for the rest to have and promotions are all going to be tied around this value proposition.

And as it relates to the payers, as Dan mentioned, look, we want as many patients to have access to Anaphylm, and it's a top priority for us. Obviously, rapid payer coverage is key, managing the friction at our HCP offices is very important. And so we continue to have very robust discussions with the payers and the PBMs who continue to tell us there's significant interest in Anaphylm. It's important to us to look at this holistically and set up a best-in-class hub and patient support service strategy. And all of that work, David, is underway. We have the luxury, if you would say, of time. And so our team has picked apart every piece of this launch and so that we are very well prepared when the approval comes.

So I just, David, want to circle a little bit more on the market access piece of this. And I'll say something that perhaps the cynics in our industry wouldn't buy into. But I do believe from my interactions with the PBMs, I do believe they want to allow innovative products to be in the hands of the patients that they support from a payer perspective. They do want that, but they have a job to do. They have something that they're trying to manage, and that's the cost of the medical and health care community.

So while we may not agree on exactly how to approach any particular product, when you're going to a PBM and you're saying you have an innovation and you're asking for a premium to a generic auto-injector, you have to tell them why. You have to tell them why your product should be in that category. And that, again, is where we really believe the clinical data and talking about how that clinical data manifests itself in the community is an important factor in our market access story. So we'll continue those conversations and look forward to seeing how they unfold.

And then the AdrenaVerse question?

I even wrote it down, and I forgot to address it. So my apologies. Yes, we're really excited about the long-term potential of the epinephrine platform. It's been frustrating, quite frankly, especially with having to deal with the CRL that we haven't been able to more quickly focus on the AdrenaVerse while we get Anaphylm through the regulatory process. The atopic derm is an entry point in our mind. As you know, it's -- we started with alopecia areata. But when you look at dermatology, atopic derm is a typical spot with a new mechanism of action or a new way of approaching something that you get into a space.

So we will, again, continue to show with our atopic derm products that in 2027, we can show real proof-of-concept data that people can buy into. We also think outside of dermatology that there are some really interesting indications, one that I know is near and dear to Dr. Matt Greenhawt's heart. We're not prepared today to say what that is, but we are working on it and look forward to hopefully bringing it forward in 2027.

Our next question comes from the line of François Brisebois of LifeSci Capital.

I just wanted to actually go into more detail, if that's okay, on a prior question because when you talk about what the learnings of the last year and how to differentiate, it seems like there's a strong emphasis now from the PK to now PD side of things. Can you explain a little bit why you think that is more important? And how -- this is kind of a 3-part question. Like why do you think the PD is so important and so relevant? And then two, is that thought process appreciated? What's the evolution of the appreciation from the medical community, especially with Matt going around and speaking to people about this? Has that evolved for them in the past year as well? And yes, I guess just to start with that.

Sure. Well, and I'm going to pass it over to Matt, but I'll just say globally, I really do think that the simplest way to describe the concept is how fast can you stop a severe allergic reaction. And PD is obviously the first way to show that, but I'll let Matt pick it up from there.

Yes, I mean, when you think about why do you give somebody epinephrine, they're having a reaction. They're starting to go into shock, showing other signs of hemodynamic distress. This is what epinephrine does. It abruptly raises your blood pressure and heart rate. And the speed of that response makes all the difference. As a clinician, that's really all I cared about every time I gave epinephrine to a patient. The blood levels are great. It's a regulatory point, but it really has limited clinical translation.

And what we're seeing and what we believe we have with our product is something that works fast and the resulting increases in heart rate and blood pressure are strong. And this difference is -- time is of the essence, and you really -- you want that to kick in as fast and as high as possible. That's how you get somebody out of danger. So I'm really excited. We have some data that we're going to present next week at the college meeting that better translates some of this from our OASIS study to show sort of really where that breakdown is of how if you focus too much on PK, you're really missing most of the story.

In terms of resonation in the field, this resonates well. This is, again, every clinician, this is what you want to hear, not what the PK is, but how fast this is going to work? How fast is my patient going to respond. That's a very tangible message. It's very approachable. I think the PK probably has been the harder thing for most of us to wrap our heads around for years and how long I've consulted and worked with the company going back to 2018, the Tmax story is great. And yes, we do -- PK, we certainly have great numbers on. Our Tmax is very fast and our Cmax is high.

But again, that's not what really matters to the patient. So I think we've been able to flip that message and either because of me or in spite of me, I think people are responding to it. And again, this was my area of expertise for years. And to hear it from me, I think with the work that I've done in anaphylaxis, I think, hopefully, it's helping. We'll see it.

That's great. That's super helpful. And then can you just remind us how you compare to others on the PD side?

Sure. Our Tmax, which is the timing of the peak of the heart rate and blood pressure is fast. Depending on the study, we're ranging between about 5 to 8 minutes depending on the blood pressure parameter depending on the study and then the heart rate response, 8 to 11 minutes. If you look in our 301 study, our 206 study for the comparators that we looked at, the earliest is the heart rate peak coming in at around 11 minutes and everything else is pushed out past 19 minutes.

Our next question comes from the line of Mazahir Alimohamed of Oppenheimer.

This is Michael on for [indiscernible]. The first question is, could you share anything about the pricing relative to other auto-injectors and neffy and your expectations on formulary access in the first year? And would you be offering like cash pay or co-pay programs?

Sure. Thank you, Michael. So look, and this will be similar to what you heard me say in the August earnings call. We're obviously spending a lot of time on the market access piece of our launch, engaging in the allowable pre-approval interactions. In terms of how we're going to price the product, that is the one piece we're going to keep to ourselves for right now. I think there are obvious dynamics in the marketplace that people can assess and come to their own conclusion on.

In terms of expectations on formulary, look, any drug that is going to be launched, there are a variety of PBMs that need to believe in your story. You need to have arrangements and ability to contract with them, and we're going through that process. So as Sherry outlined before, when we get into 2027, how we're able to show progress on that front will be an important thing we bring to this forum.

In terms of the tools we'll use Sherry and her team, of course, we're going to have the typical tools for patients, whether it is, as Sherry mentioned, having a hub or it's allowing people to use co-pay cards, things like that, will, of course, be in our toolkit. The specifics and which ones we'll use and not use, we're not going to outline today. But I would say there's just typical things you do in a launch that you'll see us do, and I don't think that will be surprising to people.

Our next question comes from the line of Raghuram Selvaraju of H.C. Wainwright.

Firstly, with respect to Anaphylm, I was just wondering if maybe Sherry could comment on which specialist prescriber subpopulation is likely to be the most receptive kind of the earliest group of adopters, if you will, among the discrete groups of specialist prescribers that she mentioned in her prepared remarks. I also wanted to ask if the company could comment on the anticipated commercial receptivity for Libervant, which obviously is likely to be launched in the hands of your new partner, Eton.

But I wanted to see if you could comment perhaps on the degree to which the market is likely to be receptive to Libervant, in particular in the context of the other formulations and routes of administration for diazepam within the target indications for which Libervant is expected to be labeled.

And lastly, if you could comment on the degree to which you expect the commercial presence of Anaphylm and regulatory familiarity with the Anaphylm regulatory package to potentially provide you with any advantages going forward as you seek to develop and optimize the value of the AdrenaVerse platform?

Sure. Thanks, Ram. So I'll let Sherry first start on the prescriber piece.

Ram, thank you so much for the question. As we stated previously, we are focused on the allergist community, first and foremost. We will be calling on approximately 8,000 physicians with our 75 or so reps. Again, predominantly the allergists as they are the highest prescribers. And then from there, there are also pediatricians and otolaryngologists, ENTs that are high prescribers of epinephrine. Again, our launch is very focused. It is a big, big market. However, we, with our team, will be focused on that community.

Thanks, Sherry. So from a Libervant perspective, and Ram, you and I have known each other a long time. We've talked about Libervant for a number of years. This is a product that we feel very attached to here at Aquestive. So we think from a patient perspective, it's an important product. These -- the product, as you know, when approved, will be labeled for seizure clusters in the epilepsy space. This is a population that is in need of good solutions and solutions that will help them. So we're very excited to get it in the hands of patients and allow them to benefit from it.

Why Eton? We did have a multi-bidding situation. So we had other companies we could have gone with. What I think Eton has done well, if you follow their story is that just like us, where I opened in my prepared remarks today with, we're executing. We're hitting the things we said we would do. I think Eton is a company that does that as well. So in their launches, they've demonstrated they can put product into patients' hands in an effective way. We really like that. And I also like their culture. I like that they put patients at the center of what they're doing, and I think that bodes well with our culture. So we're very excited to see how that launch unfolds once approved in 2027.

From an AdrenaVerse perspective, your point is well taken. There's no doubt that as Melina and Matt and the team work through the FDA interactions as well as Melina, who's championing the ex-U.S. interactions, we learn more and more about Anaphylm epinephrine prodrugs and what the possibilities are. And also, we are making the regulatory bodies more comfortable with the prodrug approach. So I definitely would agree that as time goes on, the familiarity with that platform will only help us as we spread into other indications.

[Operator Instructions] Our next question comes from the line of Thomas Flaten of Lake Street Capital Markets.

Just a follow-up on a previous question, Sherry, with respect to early adopters. How did you weight neffy prescribing in arriving at that target list of 8,000 to 8,500 prescribers? And then secondly, for Dan, has FDA communicated anything to you about a pre-approval inspection of your manufacturing facility?

Thank you so much for the question. Obviously, with the nasal device launch about 2 years ago at this time, it is a component of how we looked at the targeting for our sales representatives. The larger component is obviously the size, the amount of epinephrine that a physician prescribes on an annual basis. But of course, we did look at it and make considerations.

And Thomas, before I pass it over to Melina to talk about a potential PAI, just adding on to Sherry's thoughts. One thing I think that sometimes gets lost in the sauce in this space, we've done a lot of survey work, and I'm sure the other branded products in this space have as well. None of the surveys do we get information back from patients saying, we love auto-injectors, we want to keep them. So there is a big opportunity here, and we believe in that opportunity even more today than we did a year ago.

And when I watch Sherry and her team really think about how do we bring health care providers and patients into a world where they use a product like Anaphylm, these more innovative products, I think the position we have is compelling. It's going to take time, but the opportunity is there. But I'll let Melina talk about the PAI question.

Sure. So in terms of inspection activity, we did go through first round the 10-month review interactions with the inspection group at FDA. And the focus was certainly on more of the routine clinical sites, which I recall us communicating previously. Here, there's a 6-month review time line. We know that the inspection activity is still possible, particularly from a clinical site perspective.

When it comes to the manufacturing plant, as you know, we have a U.S.-based manufacturing facility. It's supported over the years, not only products that are under review by the U.S. FDA, but certainly globally as well. We are well prepared for when and if the agency wants to come to our manufacturing site during this review.

And I'll just add on to Melina's point. Just remember, Thomas, from a manufacturing perspective, our base business remains steady and strong. In fact, on a year-to-date basis, Suboxone is actually up. It is a declining product over time. But year-over-year on a year-to-date basis, it's actually up. On [indiscernible] , it's growing nicely, and we'll have Libervant coming into the plant as well along with Anaphylm. So that part of our business remains important and strong.

I'm showing no further questions at this time. I would now like to turn it back to Dan Barber for closing remarks.

Thanks, Stephen. Thank you to everyone for joining us this morning. As you just heard, we continue to gain momentum as we rapidly approach our March 16 action date for Anaphylm. As Sherry outlined and Matt as well, the market opportunity remains compelling. We have the financing in place for our launch and our base business remains stable. So we look forward to keeping you updated on our launch progress over the next few months. And with that, we will close today's call.

Thank you for your participation in today's conference. This does conclude the program. You may now disconnect.

Ladies and gentlemen, thank you for standing by. Welcome to the Second Quarter Aquestive Therapeutics Earnings Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded. I would like now to turn the conference over to Faith Pomeroy-Ward, Investor Relations. Please go ahead.

Thank you, operator. Good morning, and welcome to today's call. On today's call, I'm joined by Dan Barber, President and Chief Executive Officer; and Ernie Toth, Chief Financial Officer, who are going to provide an overview of the company's reported financial results for the second quarter ended June 30, 2026, and a progress update on the company's key 2026 objectives, followed by a Q&A session.

During the Q&A session, the team will be joined by Dr. Matt Greenhawt, Chief Medical Officer; Melina Cioffi, Senior Vice President, Regulatory Affairs; Sherry Korczynski, Chief Commercial Officer; and Dr. Matthew Davis, Chief Development Officer. As a reminder, the company's remarks today correspond with the earnings release that was issued after market close yesterday. In addition, a recording of today's call and related supplemental materials will be made available on Aquestive's website within the Investors section shortly following the conclusion of this call.

To remind you, the Aquestive team will be discussing some non-GAAP financial measures this morning as part of its review of second quarter 2026 results. A description of these measures, along with a reconciliation to GAAP, can be found in the earnings release issued yesterday, which is posted on the Investors section of Aquestive's website. During the call, the company will be making forward-looking statements. We remind you of the company's safe harbor language as outlined in yesterday's earnings release as well as the risks and uncertainties affecting the company as described in the Risk Factors section and in other sections included in the company's annual report on Form 10-K filed with the U.S. Securities and Exchange Commission on March 4, 2026.

As with any pharmaceutical company with product candidates under development and products being commercialized, there are significant risks and uncertainties with respect to the company's business and the development, regulatory approval and commercialization of its products and other matters related to operations. Given these uncertainties, you should not place undue reliance on these forward-looking statements, which speak only as of the date made. Actual results may differ materially from these statements.

All forward-looking statements attributable to Aquestive or any person acting on its behalf are expressly qualified in their entirety by this cautionary statement and the cautionary statements contained in the earnings release issued yesterday. The company assumes no obligation to update its forward-looking statements after the date of this conference call, whether as a result of new information, future events or otherwise, except as required under applicable law.

Now I would like to turn the call over to Dan.

Thanks, Faith, and good morning, everyone. I am excited to share today that not only have we completed the necessary studies for Anaphylm resubmission, but that we remain on track to resubmit before the end of this quarter. This is less than 8 months from when we received a complete response letter from the FDA. Our resubmission will include the results from our most recent human factors validation study. As a reminder, this study provides information on how participants interacted with our improved packaging and instructions for use. In the complete response letter received earlier this year, the FDA indicated participants experienced difficulty opening our pouch and incorrectly administered the film too many times.

I am pleased to say that after updating our packaging, labeling and instructions for use, our most recent human factors validation study showed statistically speaking, a major reduction in both categories. Under the previous packaging, we had 26 individuals indicate difficulty opening our packaging, and we had 6 individuals tear the film. This time, we had only 1 participant show difficulty and no one tore the film. In the previous study, 20 participants placed the film incorrectly on top of their tongue or on the roof of their mouth. This time, we had only 2 participants misplaced the dose during administration.

This data is further supported by our latest pharmacokinetic or PK study. In this study, we saw no statistical difference between clinician-administered and self-administered drug product. Keep in mind, subjects who self-administered were given our revised packaging and instructions for use and had no coaching by clinical staff during the administration. We also had an encouraging result when the film was purposely misplaced by clinicians on top of the subject's tongue. This data was requested by the FDA to further understand what might happen if the film is misadministered. We saw rapid and meaningful changes in blood pressure and heart rate. The changes from baseline were higher than manual IM during the critical first 15 minutes and in line with what we have seen from EpiPen in our other studies. This means that in the evaluated misadministration scenario, pharmacodynamic responses compared favorably to manual IM administration.

Even on PK, while we saw lower levels as expected compared to on-label sublingual administration, we still reached meaningful Cmax levels. This is a very encouraging outcome for the program. As we approach our planned resubmission for Anaphylm, it is a good time to review the compelling opportunity that exists for Anaphylm here in the U.S. While the epinephrine rescue market is largely generic, the need for improved clinical and carrying offerings in this category is significant. And we believe these needs could support conversion to a branded product over time, if approved.

As a large PBM publicly wrote earlier in the year about Anaphylm, this advancement stands out because emergency treatment is a category where ease of use and readiness really matter. That need starts with patients, caregivers and healthcare providers. Our interactions with the allergy community indicate there is a widespread desire among patients and caregivers for an epinephrine that is oral, works quickly, is easy to use, easy to carry and durable. Many years of research and data tell us patients still do not carry or use their epinephrine. The data also shows that medical devices such as auto-injectors are often not where you need it, when you need it, when anaphylaxis occurs.

We believe the conversion from auto-injectors starts with the allergists, and we can accomplish this efficiently. Our focus at launch will be on the allergy community, which will allow us to keep our cash burn down as we prepare for a potential launch, if approved. We believe that allergists convert their prescriptions to the first and only noninvasive orally delivered epinephrine product for the treatment of type 1 allergic reactions, including anaphylaxis, if approved by the FDA, the rest of the market could follow over time. Clearly, the desire for better products in this space is strong among patients, caregivers and healthcare providers.

This brings us to payer coverage. The first point I want to be clear on today is that we believe clinical differentiation matters to payers. Let me repeat that. Clinical differentiation matters. This goes beyond just offering a no-needle solution. In our case, the benefits from an oral medication are significant. Not only do we believe we are easier to carry than auto-injectors, our product has shown in our studies meaningful clinical differentiation from the auto-injector on time to maximum concentration or Tmax and on change from baseline blood pressure following administration. Our data demonstrates this, and we believe payers may find this meaningful. This, along with the ease of carry and use aspects of Anaphylm are important. We have a great clinical story to share, and we have already heard from multiple counterparts at various payer groups about the difficulties their individual family members face with auto-injectors.

Payer coverage is also a function of product pricing. This is the single most important decision any brand will make at launch. We are actively building our pricing strategy. And for now, we'll keep this confidential. What I will say is that based on the ongoing volume in this market, we continue to believe the market opportunity for epinephrine branded products exceeds $1 billion a year and could potentially reach $2 billion a year over time. This is driven not just by payer dynamics, but also by prescription volumes. The epinephrine rescue market has been growing for years even without significant promotional activities. Over the last few years, the market has grown annually by around 6%, and this holds true for 2026 year-to-date.

Given the large gap between prescriptions and prevalence, the continued expansion of allergy diagnoses and new product offerings, we believe this growth rate could continue for the foreseeable future. So from my perspective, the compelling opportunity in this category remains intact. We have an expanding and growing market dominated by outdated technology. We believe our product provides meaningful clinical differentiation that could support payer adoption, all while being efficient in our allergist-focused launch strategy, if approved.

Now let's talk about medical affairs and our commercial launch preparations. Our Chief Medical Officer, Dr. Matt Greenhawt and his team continue to interact with allergists on a daily basis and continue to attend all key allergy conferences. In fact, I believe awareness of Anaphylm within the allergy community is now quite high. Matt recently told me that during a major allergy conference, it was difficult to find physicians who are unfamiliar with Anaphylm. That is a testament to the team's consistent engagement with allergists over the last several years. Interaction after interaction, the team continues to share the excitement for Anaphylm to be potentially approved.

Our commercial team has launch preparations fully underway. As previously shared, the team has made excellent progress preparing for launch. Sales leadership has put plans in motion to bring on our regional sales directors and training. Marketing is driving all promotional materials and programs to be launch-ready in a manner consistent with applicable pre-approval requirements, and we are building out our commercial analytics capabilities. Simply put, we have the right experienced leadership in place and remain on track to hit the ground running as soon as possible, if approved by the FDA.

Now let's turn to AQST-108. I must admit, I was surprised after our May earnings call by how much interest we received in our atopic dermatitis program. One of the most common reactions was, "I've never thought about epinephrine for atopic dermatitis," along with questions on how we believe the science works. We have included extra slides in our supplemental materials to further elucidate the science. Simply put, a localized topical epinephrine application may have the potential to provide a meaningful treatment approach in atopic dermatitis and could potentially support a dosing profile that does not require daily administration. This could allow us to position AQST-108 with low-cost, less effective generics and significantly higher-priced biologics. We will have more to say on this program after we have completed the resubmission of Anaphylm.

Now let's turn to our partnering and base business activities. We continue to engage in active partnering processes for Libervant in the U.S. and Anaphylm outside of the U.S., and we expect to have more to say as those processes progress. Our base business as well remains cash flowing on a consistent basis. After interacting with Indivior, we also believe that there is no near-term impact to our base business based on the proposed Indivior-Supernus merger.

We continue to manage our cash carefully. As a reminder, we continue to expect $75 million in launch funds from RTW following FDA approval as well as $20 million from Oaktree. This, along with the potential cash that could be generated from our out-licensing activities if completed on acceptable terms, means we believe we are positioned to support an effective launch of Anaphylm, assuming FDA approval, satisfaction of applicable funding conditions and execution of our planned commercial strategy. In conclusion, the epinephrine market remains a healthy and growing market that is well positioned for potential conversion from auto-injectors. We are on track to resubmit our NDA in Q3. Our cash position is expected to support a potential launch, and we will have more to say on AQST-108 later in the year.

With that, I will turn the call over to Ernie.

Thank you, Dan, and good morning, everyone. By now, you will have seen our second quarter 2026 financial results in the earnings release issued last evening and detailed in our Form 10-Q filing. As we typically do, we will address most of the detailed discussion regarding the quarter during Q&A, and I will focus my remarks on the financial performance, operating spend and liquidity.

During the second quarter, our primary financial focus remains supporting the Anaphylm resubmission process while maintaining a strong balance sheet and financial flexibility. During the quarter, we also completed our refinancing with Oaktree, establishing a new $150 million debt facility that lowers our cost of capital, extends our interest-only period and enhances our financial flexibility as we prepare for a potential Anaphylm launch, if approved by the FDA. As Dan discussed, we successfully completed the human factors validation study and PK study for Anaphylm and results support resubmission of the NDA in the third quarter of 2026.

We are also continuing to manage the business with a disciplined approach to capital allocation. Our commercial team is advancing launch preparations in a manner consistent with applicable pre-approval requirements, while our medical affairs team continues to engage with the allergy community. At the same time, we remain focused on carefully managing cash as we move towards resubmission and prepare for a potential launch, if approved.

Now let me walk through the second quarter results. Total revenues increased to $13.8 million in the second quarter 2026 from $10 million in the second quarter 2025. The 38% increase was primarily driven by increases in manufacture and supply revenue and increases in license and royalty revenue. Manufacture and supply revenue increased to $11.9 million in the second quarter 2026 from $9.6 million in the second quarter of 2025, primarily due to increases in Suboxone revenues, partially offset by lower Ondif revenues. License and royalty revenue increased to $1.3 million in the second quarter 2026 from $0.8 million in the second quarter 2025, primarily due to royalty revenue from Zevra.

Total revenues increased to $28.3 million for the 6 months ended June 30, 2026, from $18.7 million for the 6 months ended June 30, 2025. The 51% increase was primarily driven by increases in license and royalty revenues and increases in manufacture and supply revenue. Manufacturing and supply revenue increased to $20.7 million for the 6 months ended June 30, 2026, from $16.8 million for the 6 months ended June 30, 2025, primarily due to increases in Suboxone revenues, partially offset by lower Ondif revenues. License and royalty revenue increased to $6.7 million for the 6 months ended June 30, 2026, from $1.6 million for the 6 months ended June 30, 2025, primarily due to royalty revenue from Zevra.

Research and development expenses decreased to $4 million in the second quarter of 2026 from $4.1 million in the second quarter of 2025. The decrease in research and development expenses was primarily due to lower development and manufacturing costs associated with the Anaphylm program, partially offset by increases in preclinical costs. Research and development expenses decreased to $8.2 million for the 6 months ended June 30, 2026, from $9.5 million for the 6 months ended June 30, 2025. The decrease in research and development expenses was primarily due to a decrease in the clinical trial costs and product research expenses associated with the Anaphylm program and decreases in share-based compensation, partially offset by increase in personnel costs.

Selling, general and administrative expenses increased to $14.1 million in the second quarter of 2026 from $12.7 million in the second quarter of 2025. The increase primarily represents higher legal fees of approximately $2.1 million, higher severance costs of approximately $1.4 million, which includes acceleration of share-based compensation, higher personnel costs of approximately $0.9 million and higher share-based compensation expenses of approximately $0.3 million as well as other expenses, partially offset by lower commercial spending of approximately $2.6 million and lower regulatory and licensing fees of approximately $1.2 million.

Selling, general and administrative expenses decreased to $25 million for the 6 months ended June 30, 2026, from $31.8 million for the 6 months ended June 30, 2025. The decrease primarily represents lower commercial spending of approximately $4.5 million, the one-time Anaphylm PDUFA fee of $4.3 million in the prior year period, lower legal fees of approximately $1.3 million, lower regulatory and licensing fees of approximately $1.9 million, partially offset by higher severance costs of approximately $2 million, which includes acceleration of share-based compensation, higher personnel costs of approximately $1.4 million and higher share-based compensation expenses of approximately $1.8 million as well as other expenses.

In the second quarter of 2026, the company recognized a one-time loss on extinguishment of debt of $11.7 million, which represents the difference between the carrying value of the 13.5% notes as of May 12, 2026, and the total payoff amount of the 13.5% notes. Aquestive's net loss for the second quarter of 2026 was $22.9 million or $0.18 for both basic and diluted loss per share compared to the net loss in the second quarter of 2025 of $13.5 million or $0.14 for both basic and diluted loss per share. Excluding the impact of the onetime recognition of the loss and extinguishment on the company's 13.5% notes, the net loss in the second quarter of 2026 was $11.2 million.

Aquestive's net loss for the 6 months ended June 30, 2026, was $30.9 million or $0.25 for both basic and diluted loss per share compared to the net loss for the 6 months ended June 30, 2025, of $36.5 million or $0.37 for both basic and diluted loss per share. Excluding the impact of the one-time recognition of the loss on extinguishment on the company's 13.5% notes, the net loss for the 6 months ended June 30, 2026, was $19.2 million. Non-GAAP adjusted EBITDA loss was $5.2 million in the second quarter of 2026 compared to a non-GAAP adjusted EBITDA loss of $9.3 million in the second quarter of 2025. Non-GAAP adjusted EBITDA loss was $7 million for the 6 months ended June 30, 2026, compared to a non-GAAP adjusted EBITDA loss of $27 million for the 6 months ended June 30, 2025.

Turning to the balance sheet. We ended the second quarter of 2026 with $98.5 million in cash and cash equivalents. Combined with the flexibility provided by our Oaktree facility and the expected availability of $75 million in launch funding from RTW and $20 million from Oaktree following FDA approval of Anaphylm, we believe we are well positioned to support our planned commercial strategy and launch preparation. As Dan noted, we also continue to engage in active partnering processes for Libervant in the U.S. and Anaphylm outside of the U.S., and we expect to have more to say as those processes progress.?Our base business also remains cash flowing on a consistent basis.?

We are maintaining our full year 2026 financial guidance.?For 2026, the company expects to have total revenue of $46 million to $50 million and non-GAAP adjusted EBITDA loss of $35 million to $30 million. In summary, the second quarter reflects continued financial discipline and execution across the business.?We delivered year-over-year revenue growth, improved non-GAAP adjusted EBITDA performance, ended the quarter with a strong cash position, and remain focused on funding the key priorities that Dan outlined today.?Those priorities including completing the Anaphylm resubmission in Q3, preparing for a potential launch if approved by the FDA, advancing AQST-108, and continuing to evaluate partnering opportunities.?

With that, I will now turn the line back to the operator to open the line for questions.

[Operator Instructions] The first question will come from Roanna Ruiz with Leerink Partners.?

A couple questions from me.?One, could you help frame how the recent PK and human factors study data potentially increases your conviction in the resubmission being very comprehensive??Can you give us updated thoughts on whether you think the FDA may use a shorter or accelerated timeframe to review the resubmission?

Sure.?Good morning, Roanna.?I will give you my thought on the PK human factors overview, and then I will ask Matt to give a little bit more color.?We know from the original review that the FDA's clinical team was bought into and signed off on the approval of our product.?So we know from a clinical perspective that there's conviction on the FDA side from at least the interactions we've had in the back and forth and what we've seen from documentation.?We know that the CRL was limited to the things that not only we shared with you, but also to that idea that the packaging was difficult to open and our instructions weren't clear for administration.?When we look at the data that we just generated, we believe we have very convincingly and thoroughly answered the open questions the FDA put out.

As you heard in the prepared remarks, on the human factors side, we think the results are very clean, and on the PK side, when self-administered, we saw no difference from clinician-administered.?Even when we look at this off-label arm that the FDA asked us to produce, we see some really interesting pharmacodynamic data.?Before I answer the timeframe question you had, I will just ask Matt to give his thoughts on the pharmacodynamic data.

In looking at the results, the one theme that I keep coming back to is just how reassuring it was to look up the results that we got.?I think, as Dan said, when you look at the repeat of the self-administration and the healthcare provider, we got exactly what we were expecting, and it is in range with what we have seen before.?So it is nice to see the reinforcement and replication of that data.?Then you look at the off-target, the top of tongue.?Those were really great data to see that there is with that, in a way that we do not intend the product to be used, that you are still getting a very clinically meaningful increase in your heart rate and blood pressure.

I think, in my opinion as a clinician, when I am prescribing a drug to a family, to a parent, they want reassurance that this is going to work.?I think we are able to look at these data and in a way that we see a response, which in a way that you would not want the drug to be taken, you are still going to get a response.?I think that is among the more reassuring things that you can counsel a family when they are making a decision on what product they would prefer to be prescribed.?So, very pleased with the results.

Going to your second question on the timeframe, our guidance to everyone remains the same.?If the classification system at the FDA would tend to say this is a 6-month review, so our guidance is this will be a 6-month review.?However, we are already engaged with the FDA on the fact that our application is coming their way.?We do think this is a very thin package compared to the 10-month review they have already done and the conclusions that they have reached.?We will be pressing them in a supportive way, not in an aggressive way, that this is an opportunity to move faster.?So whether they take that opportunity or not is up to them, and the standard time would be 6 months.

Yes.?That's helpful.?And a quick follow-up.?Thinking ahead, how would physicians typically interpret the HF and PK data on top of the existing data you've already produced, and how are you thinking about leveraging this information with the field force, detailing docs, things like that, assuming Anaphylm is eventually approved?

Yes.?I'll give it to Matt in a second again to give you his thoughts on how a physician might think about this data.?But let me be clear with the data that we've generated.?We have a great clinical story, and you heard me say that in prepared comments.?So not only in the payer world, where we think there's an ability to position the product in an important way from a clinical perspective, but also with Matt's team, the MSLs, and of course with Sherry and all her efforts and her marketing team and sales team.?We will absolutely be showing all of the great data we have, including the data we just generated.?But I'll let Matt give his thoughts.

Yes.?I think Dan said it well.?On the medical affairs side, we're very excited to get out to the next conference to be able to start sharing these details with the allergy community, and in our visits to physician offices.?How we would look at these data, this is just building more of just rounding out the story of an already sort of very nice tale.?We've got great data.?We have a product that in our studies shows a very strong magnitude of effect, and that magnitude of effect occurs very early, within a couple of minutes.?Comparatively in our studies, we've consistently seen that the magnitude of that effect exceeds that we're comparing it to.?You sort of synthesize what we just released. We were able to show that even with the top of tongue, again, probably we really would prefer you not take it this way, but if you do, even in the setting of low resulting PK, the resulting PD is overlapping with the same magnitude of change that we saw when we used EpiPen in our pivotal study.?

That to me, just sort of at this point is, I don't want to say, icing on the cake, but it's a really nice feature to be able to have to counsel your patients.?And again, if you're looking at the totality of our data, we have a consistent picture of rapid onset of the drug reaching high levels, and these are very clinically meaningful levels.?So, combine this now with human factors data that shows that clearly we've improved on sort of previous performance.?Again, reassurance. That is the one word, and it is nice to have these data, to see it over and over again in a number of different studies with the PK and PD data consistency.?It is a nice thing to have to be able to counsel your patients.

Thank you.?The next question is going to come from Kristen Kluska with Cantor.?

Congrats on these data you announced earlier in the week.?A few questions from me.?The first one, we have often talked about the product profile differences that will be important for payer discussions, but in your prepared remarks, you mentioned some of the clinical differentiation factors.?Curious if there are certain endpoints over others that you think are going to carry the most weight and how that portrays with the data that you have seen from Anaphylm so far.?And then I wanted to ask for the Cmax data for the top of the tongue, the inaccurate usage, whether the FDA in advance of this had set a bar for what they were looking for.?I know in literature they talk about this 100 picograms per milliliter being important, but is there a timeframe associated with when they would want to see that??

Sure.? Let me go in reverse order.?On the Cmax question.?As we all know, the FDA is reticent to ever give you bright lines of what you need or don't need.?But we know from our correspondence over several years that there's 2 threshold marks that they have pointed to, both in written communication with us and in meetings.?And the first one is this idea of getting over 50 picograms per milliliter, which we clearly do, on the top of tongue.?The second is this idea of clearing 100 picograms per milliliter, which we also do.?So we think from a PK perspective, and I'll hand it over to Matt in a second, and obviously as a practicing physician, I think you'll hear him say PK is not really where practicing physicians focus. But from an FDA perspective, where PK can be more important, I think we have, at least from the bars they have talked about in the past, we have what we need from, again, an off-label, or off-use, I should say, because the label's obviously in progress, an off-use administration.?

Matt, I think this is your lucky day.?It's coming back your way.?I will let Matt talk about the clinical differentiation he sees, but I think it's worth pointing out again, I think one of the learnings we have in watching this market develop is positioning a product as simply no needle is not the path to success.?The path to success is highlighting the important clinical differentiation that you have.?Then, of course, all of the important features like use and carry come along with that. But I'll let Matt talk about the specific clinical differentiation [ item C ], things that are meaningful.

Yes, I think differentiation is the word, and if you look at our data, and I'll highlight, going back to our published pivotal trial, the 301 study, the differentiation is very evident when you look at the magnitude of effect that our drug reaches versus what the comparator drugs reach in that study.?The magnitude of change is, you can see it very clearly.?It is greater.?But more importantly, it's happening faster, much faster.?And that makes a huge difference.?

In my clinical experience, and I'll disclose, I'm also a patient.?I have venom allergy.?I get stung.?Hopefully, I try not to get stung, but I get stung,?I don't want something that's going to take a long time to kick in.?I want that effect very rapidly, and I want a maximal effect. I don't sort of want a gradual increase in sort of marginal peaks of how much my blood pressure and heart rate are going to respond.?And that's what we see with our data, a rapid response in high levels.?And when you're giving epinephrine to a patient, you got a very small window in which you're watching to see, is this going to work??What do I have to do next??It's sometimes 5 to 10 minutes.?

So, you look at where the time to these onsets hit, it's within that window.?We feel, not only is the change clinically meaningful, but it's happening in a timeframe that fits when we have to make a decision.?Are we going to say that the patient's going to be okay in that when we're watching them, or are we going to have to escalate care? So to us, we believe that our properties are absolutely differentiating in that respect.?And again, my [ career ] giving out doses of epinephrine, time is precious and you really don't want to mess around with that.

The next question's going to come from David Amsellem with Piper Sandler.?Your line is open.

Hi, this is [indiscernible] for David.? First, regarding 108, any learnings from the recently completed study in androgenic alopecia that gives you confidence that the effects of 108 are relevant to atopic derm and a broader slate of dermatological conditions??That's number 1.?Number 2, also on 108, can you speak to the rationale behind pursuing atopic derm first, and how this decision plays into your broader strategy with respect to the AdrenaVerse platform??Thank you.

Sure.?Thank you for giving a little bit of airtime to 108.?Obviously, we are incredibly excited about Anaphylm and where we are and what we are doing.?But we do believe AdrenaVerse has broader use, and 108 is the first place we are putting that to work.?Starting with the rationale on atopic derm, that is pretty straightforward.?It is a well-worn path in the dermatology space that atopic derm is a good entry point and a good first initial indication for expanding into broader indications.?While we think alopecia areata is still an important indication and one that is out there for us, we want to get that first proof point through the gates.?

We have obviously been a little hampered by just the ability to focus on 108 while also bringing Anaphylm forward, and clearly, our resources are focused on Anaphylm. But to the extent that we have been able to move 108 forward, and we plan on doing that as we go forward, we do think that the science is there in a compelling way.?

I will turn it over to Matthew Davis to just give you his thoughts quickly and remind everyone why we feel good from a scientific perspective.

We are incredibly excited.?In our human trials of 108, we saw TSLP suppression.?We saw CCL3 and CCL4 suppression.?When you think of atopic derm, the number 1 symptom that you want to alleviate is itch.?Itch is not just a histaminic mast cell phenomenon.?When it comes to atopic derm, it is actually an IL-31 phenomenon, TSLP phenomenon, and mast cell.?When we looked at our preclinical program, we saw an NF-KB modulation, and that is a direct correlation with IL-31.?So if you throw together the 3 main causes of itch for atopic dermatitis, we believe that topical 108 is going to hit those areas that cause itch, and we believe that it could have a meaningful benefit.?So I am very excited.

More to come as time goes on.?But appreciate the questions on 108.

Thank you.?The next question will come from Mazi Alimohamed with Oppenheimer.?

Just really 2 for us.?One, going back to the human factor study.?Maybe on the root cause of the failure.?It seems like there was 1 open failure and 2 misplacements.?Maybe any color you can add on what the root cause analysis concluded for each, and what residual risk justification goes into the submission.?Then a second one, following up on 108.?It felt also to us that this does actually seem to be quite an opportunity in atopic derm.?One of the things that we were thinking through, though, was maybe more about dosing and long-term use, and maybe any color you could add about rebound erythema or tachyphylaxis with chronic dosing with epinephrine products in this disease.

Sure.?Yes.?Thank you for 2 really insightful questions.?First, I appreciate the opportunity to clarify on the human factors data.?I want to be really clear.?Everyone opened the pouch in our human factors study.?We had no failures to open the pouch.?The one difficulty that we had still successfully opened the pouch.?The way that human factor studies work, without diving in too deep, is it's a ranking of identified risks.?One is you opened it easily, one is you didn't open it, or another is you had some difficulty but opened it.?The one who opened it with some difficulty still opened the pouch.?

In terms of the misplacements, the 2 misplacements weren't necessarily on top of the tongue or roof of the mouth.?They just weren't completely in the sublingual cavity. If you pair that with the PK data and the conversation that we had with Matt earlier, you would expect if there had been PK around those individuals, and I'm completely giving an opinion, we don't have that data.?You would expect they would be somewhere between the self-admin data that is under the tongue and the data that was worst case scenario generated by clinicians as the FDA requested.?I think we're in a really good place on that data, and I don't think there's any additional justification necessary for those 2 things.?

On 108 dosing over time, and I will pass it back to Matthew, I'll just highlight and remind you that this is a local delivery system that we're talking about, not a systemic.?I hopefully didn't steal all Matthew's thunder.?I'm sure he can say it way better than I could.

This is an incredible opportunity.?So what we found, our preclinical team has done amazing work.?When you topically apply 108, the [ tipervefine ] has a super pharmacologic concentration on the skin.?The carboxylesterase in your interstitial fluid slowly will break that down to epinephrine.?So your question about tachyphylaxis is a great one and a vital one.?Because we appear to have this depot-like effect, we do believe that this is foreshadowing that maybe we can dose this product not even once a day.?So more to come on that.?But we believe, first of all, when you talk about immunology, with cellular-based immunology, PK does not always correlate to PD.?We are going to study the effect, this depot effect, and we believe that we can have an extended-release dosing of this product.?More to come.

Thank you.?The next question will come from Francois Brisebois with LifeSci.

Good morning.?Thank you for our question.?This is [ Eka ] on for Frank this morning.?Congratulations on the progress.?2 questions from us.?Just one clarification, as you are on track for Q3 resubmission. Can you comment, is this going to be a Class 1 or Class 2 resubmission??How does this affect the planned launch timeline, if at all??And secondly, I want to ask about something that your competitor, ARS, has flagged previously that epinephrine patients tend to refill rather than return to the prescriber.?So given this issue, what's the -- how do you think about realistically the switchable pool by year 1, say, and what's the mechanism that gets a patient to switch from existing auto-injector script?

No, 2 good questions.?The first, we did talk a little bit about the timing for the filing, but I will ask Melina to talk a little bit more about the classifications and what that means.

Certainly.?So there are 2 classifications that the agency will use to categorize an NDA resubmission.?It's a very dated system from about 30 years ago, and there's really just those 2 classifications.?One being a Class 1, a 2-month review.?Second one being that of a 6-month review.?And there's a very limited scope in terms of what would qualify for a 2-month review.?It's not really well defined.?Certainly, it would be at the discretion of the agency as to whether or not they categorize this Class 1 or Class 2.?But as Dan had indicated, we certainly will be offering a very succinct package with a very focused scope on the CRL items.?And so I do think that, at least from my regulatory experience, given the data that we will be providing, it really should be a very streamlined review for the agency. Again, it's certainly at their discretion, but I do think that they should be able to review what we consider to be a very succinct package quite quickly if they choose.

And I appreciate the commercial question because Sherry has been sitting here patiently with all the great stuff her team has been doing.?I will pass it over to her on your question.

Yes.? As you know, this market continues to be so big and it continues to grow.?I mean, year-over-year, we are seeing 6% or so growth, and even more encouraging is the allergist market continues to grow.?So when we think about how efficient our launch will be with it being allergist-focused. We have been very focused, if you will, on understanding that process.?And so the one thing that is really important foundationally is a patient does need to see their allergist every year to get a prescription.?And so I cannot really comment on the competitor as to what or why they said that.?But look, we will have a very balanced and integrated approach across multiple channels to drive those conversations with the patient and their allergist.?We have got a really compelling switch story, as you have heard all morning long. And my team is preparing to drive that messaging and that clinical differentiation that we believe is absolutely the icing on the cake.

Thank you.?And the next question will come from Raghuram Selvaraju with H.C.?Wainwright.?

Thank you all and congrats also on the progress. I wanted to ask, first of all, about your ex-U.S. plans for Anaphylm.?If you could maybe give us a sense of how you are prioritizing the different territories and where you think from a regulatory standpoint, this product candidate might be most favorably received and what the underlying market dynamics are that would inform your prioritization of those territories.?That would be very helpful.?I also wanted to ask about, on a different front, how you are thinking about the potential long-term impact to Aquestive of the recent Cosette Pharmaceuticals transaction, and perhaps more importantly, the recently announced merger combination between Supernus and Indivior, given your longstanding historical relationship with Indivior.?What you see as potential opportunities going forward in the context of those two developments.

Sure.? I will go in reverse order on this one as well and hit the long-term impact question and then give you some thoughts on the ex-U.S. market.?I will also ask Melina to weigh in again on the regulatory piece.?So first, probably most importantly on the long-term impact, with the Indivior-Supernus merger, we of course, have been in contact with Indivior with our, I do not know, I guess it is a 20-year relationship now.?And not only do we know that Suboxone sublingual film continues to have strong usage, as you have seen from their results, but also that it is an important part of the story and will continue to be an important part of the story.?While that is a legacy part of our business, it is a profitable part of our business, and we expect that to continue as is.

In terms of Cosette, they clearly are doing a good job with Sympazan.?They are actually local to us here.?We know the team there.?We think they are a good home for Sympazan.?We look forward to seeing what they do with the product.?In terms of ex-U.S., I will start with how we prioritize or where the opportunity is in the markets.?And quite frankly, just like here in the U.S., epinephrine is a mature market from an understanding standpoint.?So we know the opportunity in Europe is mathematically larger than the opportunity in Canada, which is larger than the opportunity in the U.K.?So in terms of markets, that would be the order of importance.?But in terms of how we file, I will let Melina tell you what we are thinking.

Thank you, Dan.?So we are targeting Canada, Europe, and the U.K.?We will be beginning that process this year in the fourth quarter.?There was a question in terms of how the regulators view the product.?I will just remind folks that we did have the opportunity to engage with all 3 regional health authorities.?Not only were they confirmatory that the existing data package would suffice for filing, but I will just say that they also expressed interest.?And I think that there is this concept of an unmet need that, at least from a regulator perspective, the groups understand.

Thank you.?[Operator Instructions] The next question comes from Thomas Flaten with Lake Street.

I guess to bring Sherry back on the phone.?With respect to launch readiness and the potential for an expedited review, how are you thinking through, I guess, being ready for either scenario??And then, I guess, with a focus on managing contingency offers for sales reps with maybe a bit of a variable timeline around review time and potential approval.

Well, before Sherry gives you her thoughts, I do want to give her a lot of credit.?It's never easy to have a moving target.?So I have definitely asked her to be ready for 3 or 4 different dates, which she has done a great job at, but I'll let her give you her thoughts.

Well, for lack of a better phrase, the beauty of having the CRL is it has provided us time.?I was very fortunate to be able to keep the majority of my team on board.?And so we have taken, as I have stated -- shared before, we have taken these months to really, really hone in and refine our plan.?From agencies and vendors we are using, and then also, Dan says there is a few scenario plans.?I will tell you, we have got quite a few scenario plans.?And so it will be a great problem to have if we get the 2-month approval.?So we will be ready for it.?Will it impact hiring??Sure.?I mean, we are not going to carry our salespeople for months on end, as we stated. Well, once we have the package filed, we should have fairly shortly thereafter further understanding of timing as Melina has shared with us.?And then that will allow us to determine when we are able to make those contingency offers for sales people.

I do just want to continue to remind everyone that our base case, and Thomas, we are excited too, so I appreciate the question, but our base case is a 6-month review.

Then, more broadly, strategically with respect to the AdrenaVerse platform, Dan, are you thinking about that as a kind of a rich internal development pipeline, or do you view it more as an opportunity for partnerable assets that you could farm out??And I guess more specifically with respect to AQST-108 assuming success in AD, is this something we could see you build a commercial presence in the derm space, or would you ultimately look to partner that out?

Yes, I think the great thing about this moment for Aquestive is we have the ability to grow in several different places.?With Matt Greenhawt and his experience and background, and Sherry's depth in the allergy space as well.?As we launch Anaphylm and find our ground and our market share, we will absolutely be active in that space and want to be a leader in that space.?With the technology we have, that [ bleeds ] nicely into dermatology, which is right next to allergy.?In fact, there's a variety of practices that we know in this country that are both allergy and dermatology.?One side is allergy, one side is dermatology.?So with Matthew Davis and some of the development experience we have, we do think we can play in that dermatology world as well. So if I answer your question more from a what would I like to see the company do over the next coming years, I would like to see us play in both areas and become a much larger company with multiple products.

Thank you.?I show no further questions at this time.?I will now turn the call back over to Dan for closing remarks.

Thank you, Michelle.?As you heard today from our prepared remarks in the Q&A, this is a really exciting time for Aquestive.?We do feel as though, and the expression goes that we're hitting on all cylinders.?We are on track to file Anaphylm in the coming weeks.?The epinephrine market, as Sherry said, remains healthy and growing, and we've positioned the company to launch Anaphylm quickly if approved by the FDA.?So with that, thank you for joining us, and have a great day.

This concludes today's conference call.?Thank you for participating, and you may now disconnect.

Good day, and thank you for standing by. Welcome to the First Quarter 2026 Aquestive Therapeutics Earnings Conference Call. [Operator Instructions] Please be advised that today's call is being recorded. I would now like to hand it over to our first speaker, Faith Pomeroy-Ward. Please go ahead.

Thank you, operator. Good morning, and welcome to today's call. On today's call, I'm joined by Dan Barber, Chief Executive Officer; and Ernie Toth, Chief Financial Officer, who are going to provide an overview of the company's reported financial results for the first quarter ended March 31, 2026, and a progress update on the company's key 2026 objectives, followed by a Q&A session. During the Q&A session, the team will be joined by Dr. Matt Greenhawt, Chief Medical Officer; Melina Cioffi, Senior Vice President, Regulatory Affairs; Sherry Korczynski, Chief Commercial Officer; and Dr. Matthew Davis, Chief Development Officer.

As a reminder, the company's remarks today correspond with the earnings release that was issued after market close yesterday. In addition, a recording of today's call and related supplemental materials will be made available on Aquestive's website within the Investors section shortly following the conclusion of this call. To remind you, the Aquestive team will be discussing some non-GAAP financial measures this morning as part of its review of first quarter 2026 results. A description of these measures, along with a reconciliation to GAAP, can be found in the earnings release issued yesterday, which is posted on the Investors section of Aquestive's website.

During the call, the company will be making forward-looking statements. We remind you of the company's safe harbor language as outlined in today's earnings release as well as the risks and uncertainties affecting the company as described in the Risk Factors section and in other sections included in the company's annual report on Form 10-K filed with the U.S. Securities and Exchange Commission on March 4, 2026. As with any pharmaceutical company with product candidates under development and products being commercialized, there are significant risks and uncertainties with respect to the company's business and the development, regulatory approval and commercialization of its products and other matters related to operations.

Given these uncertainties, you should not place undue reliance on these forward-looking statements, which speak only as of the date made. Actual results may differ materially from these statements. All forward-looking statements attributable to Aquestive or any person acting on its behalf are expressly qualified in their entirety by this cautionary statement and the cautionary statements contained in the earnings release issued yesterday. The company assumes no obligation to update its forward-looking statements after the date of this conference call, whether as a result of new information, future events or otherwise, except as required under applicable law.

Now I would like to turn the call over to Dan.

Good morning, and thank you for joining us today. In the last 62 days since our earnings call, we have progressed the company significantly. For Anaphylm dibutepinephrine sublingual film, we have completed our Type A face-to-face meeting with the FDA, completed a teleconference with the U.K. regulatory body known as MHRA, submitted our pediatric investigational plan to the European Medicines Agency and submitted our human factors protocol for review by the FDA. In addition, we have closed on a new debt facility with a leading life sciences debt provider and completed our Phase I safety study in humans for our pipeline program, AQST-108. We are also on track to attend over 40 conferences and submit over 20 publications this year. It is a testament to the Aquestive team that they were able to complete so much important work in such a brief period of time.

The question, of course, is where does this work take us and how do we expect the coming months to unfold. Today, I am providing guidance that we currently expect to have our human factors data and potentially our pharmacokinetic data for Anaphylm available in time for our August earnings call. Now the completion of this data is dependent on the FDA providing responses to our human factors protocol on time and the responses being within expectations, including with respect to the scope and content of that feedback. With these assumptions in mind, we continue to guide to a third quarter resubmission to the FDA, recognizing this timing remains subject to FDA feedback and ongoing review processes.

As we've stated in the past, we currently expect our resubmission of the NDA for Anaphylm to be classified as a type 2 submission with a 6-month review, although final classification is determined by the FDA. We will request an expedited review upon our submission and we'll do everything we can to communicate with the FDA and support their review process, recognizing that any decision on review timing rests solely with the FDA. We believe the comments by FDA's leadership on the need for the agency to provide more timely feedback and review points to a broader agency focus and in this case, may create the possibility of aligning with the FDA on a faster process. This, of course, cannot be guaranteed.

Our commercial preparations continue to progress. Importantly, we were pleased to enter into a $150 million debt facility with Oaktree, a leading life sciences debt provider. While Ernie will talk about this in more detail; at a global level, this agreement unlocks several important things for Aquestive. One, we have improved the interest rate terms on our existing debt and principal payments will not begin for several years. Two, this completes the pre-approval requirements for the RTW funding; and three, we have the ability to access $20 million in additional capital if Anaphylm is approved by the FDA. Taken together with our existing cash and the RTW deal, we currently project that we will have greater than $150 million in cash at launch, and this is before considering ex U.S. Anaphylm and U.S. Libervant out-licensing deals.

We plan on using this cash to focus on building intense awareness and access within the allergy community for Anaphylm. We have already shared our plans for launch of Anaphylm with you, if approved by the FDA, including a strong medical affairs presence, a 75-person sales force and a focused marketing effort. We have also been watching and learning from the launch of a nasal spray product in the market. Our research within the allergy community indicate that building clarity, trust and support for allergists is key to unlocking prescriptions. This may seem obvious, but just think of the daily pressures allergists face in running their practices. Fitting into their world in a meaningful and credible way in furtherance of patient access to Anaphylm is task #1, 2 and 3 for us.

While the U.S. market is incredibly important to us, we can't forget that 96% of the world's population does not live in the U.S. I truly believe Anaphylm is a product that will save lives, and we want as many people as possible on this planet to ultimately have access to it. Our lead ex U.S. strategy continues to be Canada and Europe, and we have made significant progress. As I mentioned before, we recently completed a comprehensive and positive interaction with MHRA, the U.K.'s regulatory body. I'm pleased to say we received confirmation that we do not need to conduct additional studies before submitting our application to MHRA in the U.K. We also recently submitted our pediatric investigational plan to the European Medicines Agency, or EMA, for the European Union. Aligning with EMA on this plan is essential to submitting our application.

We now know that we can submit applications in the EU, U.K. and Canada without conducting further clinical studies. Between the U.S., Canada, the U.K. and the European Union, our product, if approved in each of these regions, could eventually be available to almost 1 billion people in the next several years.

Now let's talk about our product pipeline. Given the excitement around Anaphylm, people often forget that we are utilizing our epinephrine prodrug platform, AdrenaVerse, to advance treatment in other indications. Our lead asset is AQST-108, and we recently completed a Phase I safety study in men with androgenic areata. I am pleased to say that there were no drug-related adverse events observed in the study, and we also saw no appreciable signs of systemic absorption of our epinephrine prodrug or of epinephrine itself. We did, however, see something intriguing. Now keep in mind, this is very early Phase I study data. Our Chief Development Officer, Dr. Matthew Davis, added biomarker assays to the study to see if we could detect changes in key proteins associated with both alopecia areata and androgenic areata, along with other dermatological conditions, such as atopic dermatitis.

While this information is not statistically powered and should be viewed as directional only, we were pleased to see in subjects with alopecia that the cytokine TSLP appeared to be impacted by AQST-108. This was not the case when subjects were given placebo. This is very exciting as the signaling pathway for TSLP involves the activation of JAK1 and of JAK2. We have included preliminary data on this work in our supplemental material available under the Presentations section of the Investor page on our website. We will talk more about the next studies for AQST-108 in the coming months once we have resubmitted our Anaphylm application in the U.S.

Our business development efforts and base business continue to move forward. Our business development team is currently in active negotiations on multiple programs for Europe, the U.S. and South America. We have also had outreach from additional regions of the world, including China and Australia. We are prioritizing this work based on the territory and program involved. We expect to have more to say on this topic in the months to come.

In summary, we expect to provide a significant data update in August, assuming the FDA keeps to its review time line and provides constructive comments to our human factor study protocol. We continue to drive awareness in the epilepsy community ahead of a potential product launch of Anaphylm if approved by the FDA. Our international filing efforts continue to be a priority, and our AQST-108 program continues to show promise for expansion into potential multiple indications.

With that, I will turn the call over to Ernie.

Thank you, Dan, and good morning, everyone. By now, you will have seen our first quarter 2026 financial results in the earnings release issued last evening and detailed in our Form 10-Q filing. As we typically do, we will address most of the detailed discussion regarding the quarter during Q&A, and I will focus my remarks on financial performance, operating spend and liquidity. During the first quarter, our primary financial focus remains supporting progress on Anaphylm following receipt of the FDA Complete Response letter on January 30, 2026, while maintaining a strong balance sheet and financial flexibility. Subsequent to quarter end, we completed a Type A meeting with the FDA and aligned on the remaining requirements for approval, including a human factors validation study and a PK study, both of which are currently underway.

During the quarter, we extended our strategic funding agreement with RTW Investments through June 30, 2027, further strengthening our liquidity runway and financial flexibility as we work towards Anaphylm resubmission. Additionally, we announced the refinancing of our existing debt with a new $150 million debt facility with certain funds and accounts managed by Oaktree Capital Management. This transaction reduces our interest rate, extends the interest-only period, saving $45 million in principal payments over the next 3 years on the existing debt that were scheduled to commence on June 30 and provides additional flexibility to fund the launch of Anaphylm if approved by the FDA. The new debt facility is available in 4 tranches with Tranche A of $55 million refinancing the existing debt, Tranche B of $20 million available upon FDA approval of Anaphylm, Tranche C of $25 million available upon achieving certain sales levels and Tranche D of $50 million available upon mutual consent of Oaktree and the company.

Now let me walk you through our first quarter results. Total revenues increased to $14.4 million in the first quarter of 2026 from $8.7 million in the first quarter 2025. The 66% increase was primarily driven by increases in license and royalty revenue and increases in manufacture and supply revenue. License and royalty revenue increased to $5.4 million in the first quarter of 2026 from $0.8 million in the first quarter of 2025, primarily due to the recognition of royalty revenue from Zevra. Manufacturing and supply revenue increased to $8.8 million in the first quarter 2026 from $7.2 million in the first quarter of 2025, primarily due to increases in Suboxone revenues, partially offset by lower Ondif revenues.

Research and development expenses decreased to $4.2 million in the first quarter of 2026 from $5.4 million in the first quarter 2025. The decrease in research and development expenses was primarily due to lower clinical trial costs associated with the Anaphylm development program, partially offset by increases in R&D personnel costs. Selling, general and administrative expenses decreased to $11 million in the first quarter of 2026 from $19.1 million in the first quarter of 2025. The decrease primarily represents the onetime Anaphylm PDUFA fee of $4.3 million in the prior year period, lower legal fees of approximately $3.4 million, lower commercial spending of approximately $2 million and lower regulatory and licensing fees of approximately $0.5 million, partially offset by higher severance costs of approximately $0.6 million, higher personnel costs of approximately $0.5 million and higher share-based compensation expenses of approximately $0.5 million.

Aquestive's net loss for the first quarter of 2026 was $8.1 million or $0.07 for both basic and diluted loss per share compared to the net loss in the first quarter of 2025 of $22.9 million or $0.24 for both basic and diluted loss per share. The decrease in net loss was primarily driven by increases in revenues, decreases in selling, general and administrative expenses and research and development expenses, partially offset by decreases in interest income and other income net. Non-GAAP adjusted EBITDA loss was $1.7 million in the first quarter of 2026 compared to non-GAAP adjusted EBITDA loss of $17.6 million in the first quarter of 2025.

Turning to the balance sheet. We ended the first quarter of 2026 with approximately $110 million in cash and cash equivalents. This cash position provides us with sufficient capital to complete the remaining FDA required studies for Anaphylm, continue advancing AQST-108 and our AdrenaVerse platform and support ongoing operations and regulatory planning, including potential ex U.S. regulatory filings and preparing for the U.S. commercial launch of Anaphylm if approved by the FDA. At this time, we are not updating full year financial guidance as our near-term focus remains on execution of the remaining Anaphylm study requirements and achieving regulatory milestones. We expect to provide additional financial and operational updates as those milestones are reached. For 2026, the company expects total revenue of $46 million to $50 million and non-GAAP adjusted EBITDA loss of $35 million to $30 million as of May 13, 2026.

In summary, the first quarter of 2026 reflects disciplined financial execution, a strong cash position and continued focus on advancing Anaphylm towards resubmission while carefully managing expenses across the organization.

With that, I will now turn the line back to the operator to open the line for questions.

[Operator Instructions]

Our first question will come from the line of Roanna Ruiz from Leerink Partners.

So a couple for me. First on Anaphylm, can you give us a little bit more detail on how things are going, preparing for the U.S. filing and ongoing study interactions or activities? It sounds like you reiterated your time line. What gives you added conviction to be able to hit that milestone?

So I think that the way to think about this moment in time for Aquestive, especially with Anaphylm is we're ready to go. We have a great team here who has the study designs completely ready. We have the sites with -- standing by ready to start the studies. We've given guidance on timing of when we expect to have top line data in our August earnings. The only trigger that we are waiting for is, as we told you in our last release, the FDA reviewing our human factors protocol, which we have commitment from the FDA on the turnaround of that, which we expect to be in the next few weeks. And as soon as we have that, we will start our studies and be on our way. So that's where the conviction on our timing comes from. And I think when you look across the broader business, you can see that we're ready to go, whether it be medical awareness or our balance sheet as well.

Sounds good. And I wanted to ask a question about AQST-108 as well. The biomarker data sounds interesting. Can you help frame that? How does that compare to other programs you've seen going after similar indications, even if they're different mechanism agents? Like how should we think about this early signal?

Sure. And I'll let Matthew Davis take that one.

Think about TSLP, what's intriguing about this signal is the fact that, one, it crosses across Th1, Th2-driven inflammation, JAK-STAT 1, JAK-STAT 2. So when you think of dermatology, you would think of mechanisms that will be beneficial for alopecia areata, androgenic alopecia, atopic derm. And there's a lot of optionality that this gives us. The fact that we also saw the correct orientation of CCL3 and CCL4 would be confirmational. Remember, this is directional only data that we're looking at the right things right now. So this gives 108 topical a lot of optionality in the dermatologic space.

So Roanna, just to add on to what Matthew said, what we like about this moment for this program is one, we obviously are not going to lose focus on Anaphylm and our attention remains there. But we've been looking to create the data and the reasons to believe on why our AdrenaVerse platform is a meaningful way to build the company. And as Matthew just walked you through and these early results show, we think we're starting to find that proof.

And our next question will come from the line of Kristen Kluska from Cantor.

Congrats on all of the progress. So I wanted to ask how your market research and conversations have been going about coverage and reimbursement. I think there's been a lot of great work to support the enthusiasm is there. But assuming you get an approval, what gives you confidence that you will get the coverage that the patients that want Anaphylm will be able to get their hands on it?

Sure. Well, look, I think I hopefully have been consistent on this point all along. Coverage and reimbursement is a struggle for every company in life sciences. So there is no doubt when we launch that Sherry and her team have a lot of work to do to get coverage for the product at the level we want the product to be available to people. So Sherry, I'll pass it over to her in a second here. Her and her team are doing a lot of the great foundational work to make that happen, but I do want to set the expectation right for everyone listening today. It will take time, and it will be something that we have to build as we go through our launch.

And with that, I'll let Sherry provide her view.

Yes. Thanks, Dan. As we've been talking about, ensuring as many patients have access to Anaphylm is our #1 priority and rapid payer coverage and reducing the friction at our HCP's office is key. Look, Dan mentioned, we have watched and learned from the recent nasal launch. We see what has worked, what hasn't worked. We're adjusting our strategy accordingly. And we continue to have very robust discussions with the PBMs and the payers. There -- from the research and from our one-on-one meetings, there is significant interest in our product. But as Dan has mentioned, it's going to take some time.

But what I can assure you with, Kristen, is we are setting up a best-in-class hub and patient support services. We are investing heavily into ensuring that there is as little friction even with those prior auths that there's as little friction and pain for our physicians' offices. That's the one thing we've learned. And so we've taken our learnings and we're applying them to how and what we will do. And so at the end of the day, we are very, very invested in ensuring that both patients and HCPs are aware of Anaphylm and then are prepared to prescribe Anaphylm and ultimately, that our patient gets their Anaphylm prescription.

Okay. And then just on that awareness angle, what do you think is going to be the biggest push that you're going to have to do in terms of getting the word out there? And how would you say potentially having this extra time since the CRL and your original planning has benefited that?

Yes. Look, when it comes to awareness, I'm incredibly pleased with where we are as a company. We're definitely, in my view, I'll use the phrase, punching above our weight. And I'm going to pass it over to Matt Greenhawt in a second. But a lot of that is because of his efforts and the team around him and with him and their efforts out in the field. As I mentioned in the prepared comments, this year, we'll be at 40 conferences and have 20 publications. And that is an extensive awareness campaign. But Matt, maybe you could provide some of your thoughts on what you see.

Yes. Hope everybody is doing well. I mean we've been busy. We've gone to what 13 conferences to date. We're going to hit over 40 ideally. Just writing papers, there's a lot of data. There's a great story to tell here and doing my best to get this out. And hopefully, this will go through publication some point this summer to early fall. We go and we meet with people at these meetings. There's a lot of enthusiasm. There's a lot of excitement. And it's great to have the opportunity to just sit and talk about what our story is, what we believe this product can do and just be there to reassure and answer questions about any -- really anything that they want to know. So a nice opportunity to really get out and meet everybody. And again, these are mostly my former colleagues. So it's nice to be able to interact with them and share my enthusiasm about this product and again, where we believe that this is going to go.

And I think we see that coming through in the survey work we do when we ask, are you aware of our products, and you see those numbers steadily going up over time.

And our next question will come from the line of David Amsellem from Piper Sandler.

This is [indiscernible] on for David. Just a couple of quick ones from us. So first, with Neffy, now that, that's been on the market for around 18 months, can you elaborate on the learnings from that launch that are influencing any changes to your commercialization strategy? That's number one. And number two, with the Oaktree financing in place and the pre-approval conditions for the additional RTW financing met, is that sufficient runway through the launch of Anaphylm? So if you could provide some clarification there, that would be great.

Sure. Yes. Well, let me go in reverse order. and let's start with Oaktree. And I'm going to pass it over to Ernie for a minute here. From our perspective, I'll open with that piece by saying, look, we're incredibly excited about the relationship with Oaktree. And now with both RTW and Oaktree as key backers of the organization, we think we're well positioned. But Ernie can give you his thoughts on runway through the launch.

Certainly, you mentioned with the refinancing of the existing debt with Oaktree, that satisfied the second condition for under -- or first condition under RTW was that we refinance our existing debt, so we have access to that capital. Second being that we get approval on Anaphylm. As we've said publicly, both in our oral and written statements that this provides us runway through the launch next year, if approved. It puts the company in probably the best capital position it has ever been, and we feel confident that we'll have the funds in place ready to launch on approval of Anaphylm.

And let me go back to your first question, which was on the learnings from Neffy. I'll give you my thought, and then I'll ask Sherry to also give hers. For me, I think the key learning is no matter how innovative your product, and we clearly believe our product is innovative and potentially transformative in this space, you can't take anything for granted. all of the hard work, the basic blocking and tackling work of launching a drug, being out in front of the doctors, telling your story, getting coverage, all of that you have to do no matter how innovative your product is. So we are definitely focused on making sure we're ready to do all of that hard work. But Sherry, I'll let you add your thoughts to that as well.

Sure. Thanks so much. And thanks so much for the question. Look, as you know, having a non-device oral easiest to carry epinephrine, it is a game changer in the marketplace. But again, as Dan mentioned, no matter -- you build a better mousetrap, it doesn't necessarily mean they will -- it will come. And we've seen this in this marketplace. As you know, I ran the EpiPen brand. And we saw the same thing happen with Auvi-Q. So just because you build a better mousetrap doesn't mean that everyone will come. So what have we learned? I think one is how do we reduce that friction. And so as I just mentioned to Kristen, we are really working hard in our very robust discussions with the PBMs and payers, but also working on setting up the best-in-class hub and support services to support the offices. I think we heard from ARS back in their March earnings call is that they were kind of doubling down in the allergist space, increasing reach and frequency in the allergists. We know that this market is driven by the allergists and the high prescribing pediatricians.

Our plan, as you know, we've moved to 75 reps as well as then obviously, the managers and the support around that is critical to drive this -- the product forward. And so look, I think at the end of the day, reducing friction in the physician's office is critical, ensuring that physicians and patients have awareness and really driving believability in the product. So Matt's team is out there doing a fantastic job. I mean our market research shows the awareness with the HCPs has gone from a 33% to 66%. So the increased effort and publications and all the medical work that is being done will only continue to do that. But that only gets us so far, right, with the awareness we have to have doctors believe in it. So all of the scientific work Matt and his team are doing, the publications we will continue to put out are critically important. And then physicians have to get experience with the product in their office. And so we will look to launch a program upon approval so physicians can get that actual real-world experience.

Does that answer your question, David?

It does.

And our next question comes from the line of Francois Brisebois from LifeSci Capital.

So I was just wondering on that friction pain in the physician's office, is this something where it's kind of -- it's always the same issue. Is there one problem that seems to be recurrent everywhere that's easily fixable? Or is this a situation where it depends on the practice. It depends on the state. It depends on the doctor. How far can you guys go in terms of better understanding if you have to do like a custom approach to each office? Or is there something where it's like I think we've got something here that is the main problem most of the time?

So I'll say -- let me position it this way. while we're working on it and Sherry gave you the kind of the big overview, we definitely will be keeping a decent amount of our playbook to ourselves. So yes, we do see opportunity on how to manage the friction. We do, as Sherry talked about, see some of the basic steps that every company takes like having a good hub, like being there with frequency. But in terms of the tailor-made approach and how we tackle that, some of that we're going to hold back on for right now. But I'll -- I guess the way I'll leave it with you is more to come.

Okay. Great. And on the -- in terms of the FDA, there's just so much with you guys with the FDA right now. Has the personnel changed? Any updates on -- there's obviously been quite a bit of change with the FDA. Anything in terms of your case that has changed or has been more worrisome about this timing. I think you guys are waiting on the review from the human factors protocol. If you just -- in terms of time line and expectations and comfort, and then you mentioned there could be a possibility where things even accelerate. Can you just dig a little bit more into your -- what you can share about FDA interactions?

Sure. Well, I'll talk about the acceleration piece, and then I'll pass it over to Melina to talk about her view on the stability of the people we're interacting with. So to be clear, it is -- we believe we will be assigned a 6-month review clock because that would seem to be what the statutes are saying. However, we firmly believe that the package we're going to be putting in, as all of us are aware, will be the human factor study and the PK study that we're doing, and that's it. So we do believe there's an opportunity to say to the FDA, this is a limited package, and it shouldn't require the full 6 months. We also would note there's precedents for that in the other recent branded product in this space. So that will be our approach on pushing for hopefully, action sooner than the full 6 months. But in terms of the stability of the individuals at the FDA, I'll pass it over to Melina.

Thank you, Franc. The team, the review team across the board, across the various divisions remain intact, meaning that these are the same individuals that have worked with us early on during the development. of the product as well as during the review. So we foresee no abrupt changes at this point.

And our next question comes from the line of Mazahir Alimohamed from Oppenheimer.

So just a couple from us. I guess the first one is in terms of the Zevra royalty, how should we think about this $5.4 million? Is that a run rate figure? Or were there any catch-up payments in Q1 that make this a high watermark for the year? And then kind of one more -- a little bit more mechanistic on the TSLP biomarker. So it kind of seems like JAK1/2 sits downstream of TSLP signaling and that JAK inhibitors which currently carry the black box warning largely due to their exposure could limit the uptick. So I guess, how confident are you that AQST's topical delivery profile would avoid the systemic JAK inhibition risks that currently limit the oral agents?

So I'll let Ernie start with the Zevra royalty and then go to Matthew for the TSLP.

So no, you should not think of this as run rate for the year. We've got to remember that what we received from Zevra is a part of an agreement we have with them where we have an economic interest in one of their products, Azstarys. Zevra recently sold that product -- and as a result of that, received a $50 million payment of which we were entitled to 10% of. So that is what accounts for the $5 million -- approximately $5 million in the first quarter.

And let's turn to your question on TSLP, which go to Matthew.

That's an absolutely great question. So when you think about the broad-based nature of immunomodulation when it comes to the AdrenaVerse, you should think that we're not a specific actor inhibiting one pathway. So the healthy normal subjects that volunteered for this trial did not have an elevated TSLP. They did not have elevated CCL3, CCL4 and the topical AQST-108 did not actually modulate those patients. So the patients that had androgenic alopecia, there's not a broad-based inflammatory condition, but they did have elevated TSLP and the topical 108 did reduce that directionally. So our preclinical research and also the published literature says that topical beta 2 agonists have a broad-based immunomodulator, they're not specifically targeting one pathway. A JAK inhibitor specifically basically targets one pathway. Now as the program advances, we'll find out more about it, and we will inform you as we get more data. But that's sort of the differentiation between a broad-base modulation versus a single pathway inhibitor.

And our next question will come from the line of Raghuram Selvaraju from H.C. Wainwright.

This is [ Yan Zi ] sitting in for Ram. So I have a few questions. The first is for Anaphylm. So for Anaphylm ex U.S., you said that you have existing clinical data that's enough to support filings in Canada, EU, U.K. and so on. And I'm just wondering, how are you thinking about sequencing, partnering, price access, all the works and the retained economics across those markets?

Sure. Yes. So -- and we can go into further detail, if you want, on the existing clinical piece. But as Melina and her team have worked very hard, we've met with the regulatory bodies in Canada, U.K. and EMA. So that's where our comfort comes from that the existing clinical package is sufficient. And we are working rapidly towards regulatory filings in multiple jurisdictions. So from that perspective, we're in good shape. From the partnering perspective, we're well on our way in Europe, in particular. I would say the economics are similar to what you would expect for a program at this stage. So we do understand the markets. We've done our work in those markets. We understand what we should retain versus what a partner should be able to also be rewarded and feel good about. So I think those -- I would guide you to being within industry norms. And in terms of timing, I've learned over the year with BD deals, timing is always a tricky thing. So what I would tell you is we are on our way. And when we get to the right place, you guys will be the first to know.

Great. And now with respect to the Oaktree facility, do you -- would you be able to disclose what the payment -- prepayment provisions are there? For example, like what are the cash restrictions, for example?

I think everything is disclosed in the 8-K. It's pretty extensive disclosure on the covenants and the restrictions and everything. So I would refer you to it.

I would just broadly say we are happy with not only the quality of the debt provider we have with Oaktree, but the ability to run our business and grow our business without being restrained. So we think that is a key part of this announcement.

Our next question will come from the line of Jim Molloy from Alliance Global Partners.

This is Laura in for Jim Molloy. So for AQST-108, you've touched on this already a bit, but how do you think you're going to further look into the TSLP biomarker data in future studies for 108? And how meaningful do you think this finding is for the atopic dermatitis indication specifically that you're looking to study?

Sure. I'll pass it over to Matthew in a second. But I would say we're definitely excited. It's definitely a positive thing and something that we're happy to see and confirmatory of what we thought we would see. But as Matthew guided, it is early stage -- is early-stage information. And I also do want to just reiterate that in the short term, so over these next few months, everyone's brain power resources, time, including Matthews' will be heavily geared towards making sure we get our Anaphylm resubmission right. So that is definitely priority #1. But I'll let Matthew give you his thoughts on what might come next.

I'm very, very excited about the directional discovery of the TSLP. But please remember, this is one of many biomarkers. So it guides you towards inflammatory states dermatologically topically. But also in additional programs, we want to expand upon the biomarkers and the utilization of biomarkers because we believe based on literature and based on our own preclinical work, that there is a lot of opportunity, and we believe that the topical beta 2 blockers and the drivers in general really has the potential of being a broad-based immunomodulator. And as we develop our programs, once we're done with Anaphylm, we will guide everyone on what direction we're going and what information we're going to be looking at. But this is a really exciting first step.

Got it. And also for Anaphylm with plans to expand globally, are you still on track to file for full submission to the EMA and Health Canada by the end of the year? And how would you just compare the overall U.S. versus ex U.S. timing?

Yes. Well, the U.S. timing, obviously, we've been very open about. We continue to guide to a Q3 submission. We think it's a 6-month review. We're going to try to get the review to be faster. So obviously, the math there is pretty basic. On Canada, we continue to see a 2026 filing. On Europe, we're definitely shooting for a 2026 filing. We're going to be right up against the New Year's holiday where that falls. So whether that is late Q4 or early Q1, I'm not sure that the calendar turn is what matters on that so much is getting it right and getting it in as fast as we can.

I'm not showing any further questions at this time. I would now like to turn it back over to Dan Barber for closing remarks.

Thank you, Victor. As I said earlier in the call, we are, in our view, ready to go. We're ready to conduct our studies. We're ready to build our awareness even further. And if approved by the FDA, we're on track to launch Anaphylm. And we look forward to updating you on our additional progress in the months to come. And with that, thank you for joining us, and have a great day.

Thank you for your participation in today's conference. This does conclude the program. You may now disconnect. Everyone, have a great day.

Good day, and thank you for standing by. Welcome to Aquestive Therapeutics Fourth Quarter 2025 Conference Call. [Operator Instructions]

Please note that today's conference is being recorded.

I will now hand the conference over to your speaker host for today, Faith Pomeroy-Ward.

Thank you, operator. Good morning and welcome to today's call. On today's call, I'm joined by Dan Barber, President and Chief Executive Officer; and Ernie Toth, Chief Financial Officer, who are going to provide an overview of the company's reported financial results for the fourth quarter and full year ended December 31, 2025, and a progress update on the company's key 2026 objectives, followed by a Q&A session.

During the Q&A session, the team will be joined by Dr. Matt Greenhawt, Chief Medical Officer; Melina Cioffi, Senior Vice President, Regulatory Affairs; Sherry Korczynski, Chief Commercial Officer; and Dr. Matthew Davis, Chief Development Officer.

As a reminder, the company's remarks today correspond with the earnings release that was issued after market close yesterday. In addition, a recording of today's call and related supplemental materials will be made available on Aquestive's website within the Investors section shortly following the conclusion of this call.

To remind you, the Aquestive team will be discussing some non-GAAP financial measures this morning as part of its review of fourth quarter and year-end 2025 results. A description of these measures, along with a reconciliation to GAAP, can be found in the earnings release issued yesterday, which is posted on the Investors section of Aquestive's website.

During the call, the company will be making forward-looking statements. We remind you of the company's safe harbor language as outlined in today's earnings release as well as the risks and uncertainties affecting the company as described in the Risk Factors section and in other sections included in the company's annual report on Form 10-K filed with the U.S. Securities and Exchange Commission on March 4, 2026.

As with any pharmaceutical company with product candidates under development and products being commercialized, there are significant risks and uncertainties with respect to the company's business and the development, regulatory approval and commercialization of its products and other matters related to operations. Given these uncertainties, you should not place undue reliance on these forward-looking statements, which speak only as of the date made. Actual results may differ materially from these statements.

All forward-looking statements attributable to Aquestive or any person acting on its behalf are expressly qualified in their entirety by this cautionary statement and the cautionary statements contained in the earnings release issued yesterday. The company assumes no obligation to update its forward-looking statements after the date of this conference call whether as a result of new information, future events or otherwise, except as required under applicable law.

Now I would like to turn the call over to Dan.

Thanks, Faith. Good morning, everyone, and thank you for joining us. Today, my message to you is simple and clear. This is a great moment in Aquestive's evolution, and I'm filled with optimism for our future. I am filled with optimism because I believe our path has never been clearer. I believe our risk profile has never been lower. And I believe our transparency allows all of you to see this as well.

Let me walk you through where we are today on bringing Anaphylm to market here in the U.S. as well as around the world. We believe we have a very clear and achievable set of instructions from the FDA on resubmission of our NDA. We have submitted our Type A Meeting request and expect to have a discussion with the FDA within the next 30 days. We have already selected our clinical research organizations for both the human factor study and PK study and continue to prepare for dosing. We are agreeing to everything the FDA requested, with 1 minor clarification on the arms required for the PK study. We have already modified our packaging to make the pouch easier to open, and this has no impact on stability or durability.

We are reiterating today our commitment to filing our resubmission in the third quarter of this year. You can also find more specific details on our program, including pictures of the revised packaging, in our supplemental materials found on our website.

While it's great to have a clear path and plan, you also need the right team, and I am fortunate that we have a fantastic development team here at Aquestive, with the recent addition of Dr. Matt Greenhawt, a world-renowned allergist and this year's recipient of the prestigious Distinguished Clinician Award by the American Academy of Allergy, Asthma and Immunology, AAAAI, and the addition late last year of Dr. Matthew Davis, a seasoned development leader from large established organizations, we have the clinical expertise to efficiently conduct our development studies interact effectively with the FDA and appropriately inform the medical community of our clinical results. This is by far the strongest clinical team Aquestive has ever had.

In fact, it will be important that we get our scientific and medical information out to the community as broadly and deeply as possible this year. That is why in addition to Dr. Greenhawt joining us, we are more than doubling the size of our medical affairs organization. This will allow us to attend more conferences, educate more physicians on our data and provide the community with more scientific publications in the coming months.

This clinical and medical prowess also aligns with our work outside the U.S. We remain on track to file in Europe and Canada before the end of the year. We also will be meeting with the U.K. health authority, known as MHRA, in the coming weeks. We are confident that Anaphylm can benefit all humans, and we want to expand access to our product outside of the U.S. as rapidly as possible.

Now let's turn to the commercial side. Launching a prescription drug in the U.S. is extremely difficult. It requires considerable capital, patience to work through the complexities of the payer world, and significant marketing efforts across a variety of channels. Similar to development, this takes having the right people. As you may recall from my comments a month ago, Sherry Korczynski, our Chief Commercial Officer, and I made the decision to keep the core commercial leadership team intact following our CRL. That team continues to do great work and prepare for launch.

This extra preparation time allows us to think bigger, and we are guiding today that we will launch with 50% more sales reps upon approval compared to our previous guidance. This means we expect to have 75 reps at launch versus the previous guidance of 50. Our planning process indicates we should be able to do this from a close to cash-neutral position by the end of 2027.

Speaking of cash, as stated before, launching a drug takes tremendous amounts of capital. Accessing this capital means making sure you have the right investors who believe in your product, your story and your team. That's why we were excited to announce today that RTW has extended their revenue sharing agreement with us to consummate at any time before June 30, 2027, and has also agreed to invest additional capital in the company. We appreciate the faith put in us by the RTW team and, like all of our investors and shareholders, take this responsibility seriously. This, along with our cash guidance that Ernie will discuss in a few minutes, we believe positions us well for a potential launch.

In terms of the underlying allergy market, we continue to see overall prescription growth. EpiPen and generic auto-injectors grew by approximately 5% in the fourth quarter of 2025. And the overall market grew by just over 9%. Importantly, we also continue to see a market that seems to be waiting for the first oral epinephrine product. Over 90% of prescriptions remain with auto-injectors. And obviously, the entire market continues to use medical devices. As I've stated in the past, we believe seeing is believing with our oral medication. When patients have the physical film in front of them, our data indicates they will almost always choose the film over auto-injectors and nasal sprays.

Given the potential near-term launch of Anaphylm in the U.S., if approved by the FDA, we will continue to both simplify and grow our overall business where possible.

From a litigation standpoint, this means we will continue to seek ways to simplify our workload while also appropriately defending our business. In December, we reached a settlement agreement in a 9-year long defamation lawsuit brought by a competitor, and I am pleased to remove this distraction from the business. This marks the fourth lawsuit we have been able to have withdrawn, get thrown out of court or reasonably settle over the last 4 years.

We are also guiding that due to the timing of a potential Anaphylm launch, our initial focus with Libervant will be licensing the product in the U.S. We have several parties already interested and actively engaged in discussions. We will keep you updated on this as the year progresses. We continue to believe Libervant is a tremendous product that can meaningfully improve patients' lives. We also note that the 2 nasal spray products available for the treatment of seizure clusters are forecasted to exceed over $400 million in sales this upcoming year.

We continue to progress nicely with multiple parties in Europe for a license of Anaphylm and expect to use a licensing approach for that market.

Finally, we also have our eyes towards the long-term future of the company. We continue to believe in a long-term, multiproduct potential of AdrenaVerse, our prodrug epinephrine platform, we successfully opened an IND for AQST-108 in December 2025, completed dosing of our initial safety study last month and expect to have top line clinical data in the near future. We will keep you informed on this program as we move forward.

In summary, now is a great time for Aquestive. We have a clear path to market for Anaphylm; we have a clear path to the necessary capital to launch Anaphylm if approved by the FDA; we have the right clinical, regulatory and commercial leaders to effectively execute on our strategy; we are focused on out-licensing activities for Libervant and ex U.S. for Anaphylm; and we continue to progress our long-term pipeline.

With that, I will turn the call over to Ernie.

Thank you, Dan, and good morning, everyone. By now, you will have seen our financial results in our earnings release that was issued last evening. As we typically do, we will address most of the discussion related to the fourth quarter 2025 and full year 2025 results in the Q&A.

During 2025, we made great progress in positioning Aquestive for future success, including submitting the NDA for Anaphylm, the first and only noninvasive, orally delivered epinephrine products, if approved by the FDA; closing an $85 million equity raise from high-quality institutional health care investors; secured $75 million in revenue interest financing from RTW upon approval of Anaphylm; and ended 2025 with $121 million, with cash runway to support costs associated in preparing for the Anaphylm NDA resubmission, including the new human factors validation study and supportive PK study, pre-commercial infrastructure costs to increase awareness of Anaphylm through the execution of its medical affairs strategy, including presenting scientific data at medical forums throughout 2026, planned regulatory submissions in Canada and in the EU, and the AQST-108 Phase I clinical trial.

As outlined in the press release issued last night after market close, we announced an extension until June 30, 2027 of our agreement with RTW. This extension secures the availability of the revenue interest financing to support the commercial launch of Anaphylm if approved by the FDA. RTW has also agreed to an additional strategic investment of $5 million in Aquestive, showing continued confidence in the company.

Now let's turn to the recap of our quarterly and full year financial results. Total revenues increased to $13 million in the fourth quarter 2025, from $11.9 million in the fourth quarter 2024. This 10% increase in revenue was primarily driven by increases in manufacture and supply revenue.

Manufacturing and supply revenue increased to $12 million in the fourth quarter 2025 from $10.7 million in the fourth quarter 2024, primarily due to increases in Suboxone revenues and Ondif revenues. Excluding the impact of onetime recognition of deferred revenues during the full year 2024, total revenues decreased by $1.5 million or 3% to $44.5 million for the full year 2025. As a reminder, the onetime recognition of deferred revenue in the prior year was due to the termination of licensing and supply agreements.

Including the deferred revenue recognized in the prior year, total revenues decreased to $44.5 million for the full year 2025 from $57.6 million for the full year 2024. Manufacture and supply revenue increased to $40.2 million for the full year 2025 from $40 million for the full year 2024, primarily due to increases in Ondif revenues, partially offset by decreases in Suboxone revenues.

R&D expenses decreased to $3.2 million in the fourth quarter 2025 from $4.9 million in the fourth quarter 2024. The decrease in R&D expenses was primarily due to a decrease in clinical trial costs associated with the continued advancement of the Anaphylm development program and a decrease in share-based compensation. R&D expenses decreased to $17.2 million for the full year 2025 from $20.3 million in the full year 2024. The decrease in R&D expenses was primarily due to lower clinical trial costs associated with the continued advancement of the Anaphylm development program, partially offset by increases in product research expenses and share-based compensation.

Excluding onetime legal expenses, selling, general and administrative expenses increased to $19.6 million in the fourth quarter 2025 from $16 million in the fourth quarter 2024. Including the onetime legal expenses, selling, general and administrative expenses increased to $32.8 million in the fourth quarter 2025 from $16 million in the fourth quarter 2024, primarily due to higher legal expenses of approximately $13.6 million, higher commercial spending of approximately $3.7 million in preparation for the launch of Anaphylm, higher personnel expenses of approximately $0.8 million and higher share-based compensation of approximately $0.2 million, partially offset by lower severance expenses of approximately $1.7 million and lower regulatory in-licensing fees of approximately $0.5 million.

Excluding onetime legal expenses, selling, general and administrative expenses increased to $66.6 million for the full year 2025 from $50.2 million for the full year 2024. Including onetime legal expenses, selling, general and administrative expenses increased to $79.8 million for the full year 2025 from $50.2 million for the full year 2024. The increase primarily represents higher legal fees of approximately $14.3 million, higher commercial spending of approximately $9.6 million in preparation for the launch of Anaphylm, the Anaphylm PDUFA fee of $4.3 million, higher personnel expenses of approximately $1.9 million, higher regulatory expenses related to Anaphylm of approximately $1 million and higher share-based compensation expenses of approximately $0.9 million, partially offset by decreases in severance expenses of approximately $2.8 million and lower insurance expenses of approximately $0.6 million.

Excluding onetime legal expenses, Aquestive's net loss for the fourth quarter of 2025 was $18.7 million or $0.15 for both basic and diluted loss per share, compared to the net loss for the fourth quarter of 2024 of $17.1 million or $0.19 for both basic and diluted loss per share.

Including onetime legal expenses, Aquestive's net loss for the fourth quarter 2025 was $31.9 million or $0.26 for both basic and diluted loss per share, compared to the net loss for the fourth quarter 2024 of $17.1 million or $0.19 for both basic and diluted loss per share. The increase in net loss was primarily driven by increases in selling, general and administrative expenses and manufacture and supply expenses, partially offset by decreases in research and development expenses and increases in revenue and interest income and other income.

Excluding onetime legal expenses, Aquestive's net loss for the full year 2025 was $70.6 million or $0.66 for both basic and diluted loss per share, compared to the net loss for the full year 2024 of $44.1 million or $0.51 for both basic and diluted loss per share.

Including onetime legal expenses, Aquestive's net loss for the full year 2025 was $83.8 million or $0.78 for both basic and diluted loss per share, compared to the net loss for the full year 2024 of $44.1 million or $0.51 for both basic and diluted loss per share. The increase in net loss was primarily driven by increases in selling, general and administrative expenses and manufacturer and supply expenses and decreases in revenue, partially offset by decreases in R&D expenses and increases in interest income and other income.

Excluding onetime legal expenses, non-GAAP adjusted EBITDA loss was $14.1 million in the fourth quarter 2025, compared to non-GAAP adjusted EBITDA loss of $11 million in the fourth quarter 2024. Non-GAAP adjusted EBITDA loss, excluding adjusted R&D expenses and onetime legal expenses, was $10.8 million in the fourth quarter 2025, compared to non-GAAP adjusted EBITDA loss excluding adjusted R&D expenses of $6.6 million in the fourth quarter 2024.

Excluding onetime legal expenses, Aquestive's non-GAAP adjusted EBITDA loss was $49.7 million for the full year 2025, compared to non-GAAP adjusted EBITDA loss of $23 million for the full year 2024. Non-GAAP adjusted EBITDA loss, excluding adjusted R&D expenses and onetime legal expenses, was $34.4 million for the full year 2025, compared to non-GAAP adjusted EBITDA loss, excluding adjusted R&D expenses, of $4 million for the full year 2024.

As of December 31, 2025, cash and cash equivalents were $121.2 million.

As outlined in the press release issued last night after market close, our outlook for 2026 is total revenue of $46 million to $50 million and non-GAAP adjusted EBITDA loss of $30 million to $35 million. We expect to end 2026 with approximately $70 million, excluding any additional proceeds from RTW or out-licensing transactions.

Our non-GAAP adjusted EBITDA loss guidance for 2026 includes costs associated with the resubmission of the NDA for Anaphylm, continued pre-commercial infrastructure spending for Anaphylm, clinical trial costs for AQST-108, and regulatory applications for Anaphylm in Canada and the EU. Current guidance does not include costs associated with the sales and marketing of Anaphylm, if approved by the FDA.

With that, I will now turn the line back to the operator to open the line for questions.

[Operator Instructions] And our first question, coming from the line of Roanna Ruiz with Leerink Partners.

So a couple for me. Starting with the Type A Meeting with the FDA. I just want to confirm I heard it correctly, it sounds like you submitted a request, but it has not been scheduled yet, but that could happen soon. And secondly, could you elaborate a bit on your main goals going into this meeting? And is there any additional information you need to prepare for the FDA for this meeting?

Sure. Roanna, I'll hand it over to Melina in a second here. Just a couple of basic things. We have submitted. We expect that meeting to happen shortly. I'll let Melina walk you through kind of the, I'll call it, the contract that the FDA has to uphold.

From a goals perspective, we don't need a lot out of the meeting. And I'll also let Melina elaborate a little bit on that.

Thank you, Dan. So in terms of the timing, the FDA guidelines state that the agency should meet with the sponsor within 30 days from the date that we submitted our meeting request and our briefing book. So if they go according to [ those time lines ], we should be able to meet with them towards the end of this month or very early April.

In terms of the goals of the meeting, we shared with them our briefings that outlined our commitment to conduct the 2 studies that they requested in the CRL. And we also asked questions to ensure that we walk away essentially from this meeting with clear alignment on how best to execute for the purposes of the [indiscernible].

Right. And Roanna, I would just remind you and those on the call, it's been 31 days since we received our CRL. And in those 31 days, we've not only written the protocols, contracted our CRLs, changed our packaging, written a briefing book, resubmitted that briefing book to the FDA, but obviously also brought on a new Chief Medical Officer and redesigned our deal with RTW. So we feel really good that we are on track in every way, and the Type A Meeting is just one part of that. .

Yes. That's super helpful. And a follow-up on that, I think you mentioned doing a modification to the proposed protocol that the FDA mentioned in the CRL, or could you just explain a bit more about that? Is it relatively straightforward? And how should we think about it moving -- with the FDA interaction with you coming up?

Yes. That's, in my view, so we won't get into the exact question, we'll obviously be able to share that in a few weeks here, but that's literally the only question we have for the FDA. And we're fine with the answer either way. So the minor modification, Matthew Davis and his team just want to make sure they understand how the FDA is thinking about it. And once we have the answer, we'll -- there's nothing more we need.

Our next question coming from the line of Kristen Kluska with Cantor Fitzgerald.

I have a couple as well. On the RTW, great to see you extended that option. I noticed that the language was through the end of June next year. You had told us that your expectation is that it would be a 6-month review upon submitting. Is the time line here just to give you a little bit of buffer room on the back end? And then also, can you just confirm that it's still $75 million and that those terms haven't changed?

Yes. The second question, I'll turn it over to Ernie in a second, but in terms of the timing of why June 30, 2027, that's easy, because it's easy to modify the 1 year. We in no way expect to need anywhere near that amount of time to bring our product to market. But it's just an easy way to update the contract. But I'll let Ernie talk about any other changes.

Kristen, yes, we can confirm that none of the terms of the agreement with RTW have changed. I think the important thing is here with the additional purchase of $5 million. We appreciate their continued support as we move forward through the process this year of resubmission and hopefully an approval and launching the product next year.

Okay. And then I know Sherry and team have been doing a lot of work in terms of mapping territories this past year. So I wanted to ask a little bit more on this decision to add 50% more sales reps. Was this just driven by seeing new pockets where you think you would need more boots on the ground? Or is there anything specific that led to this decision as well as the specific percent more that you'll be adding?

I'll let Sherry take that.

Kristen, thanks so much for asking this question. We're very excited about our decision. Why did we do it? We went back as we've been doing with all of our commercial work that we were preparing for launch, to say, how many more reps do we need to cover much deeper -- penetrate much deeper into the allergist market? And in the same regard, ensuring that we are also -- the reps will be calling on the pediatricians, the high decile pediatricians.

When we took a look at the reach and frequency that we're able to achieve by moving towards the approximately 75 reps, there are a couple of reasons why that made sense. One was, obviously, with smaller territories, it allows our reps to have greater efficiency as that will allow them not to have to travel hours to see all the important physicians. So one, it's greater efficiency.

Two, it closes white space. So as I'm sure you can imagine, with 50 reps, we would have had a lot of white space. We would have handled that through inside sales reps. However, again, by moving to the 75 reps, it gives us much greater coverage.

And Kristen, I think you can see that our investment in the allergy community is growing in general. So it's not just the reps. But with Matt Greenhawt and the medical affairs team getting bigger as well, our ability to be out there with publications, you saw our presence at AAAAI last weekend, we are making sure we are front and center as we go into launch.

Our next question, coming from the line of David Amsellem with Piper Sandler.

So just a couple for me. One is maybe taking a step back, can you talk about how you settled on the trial design? And are you prepared to make any modifications to the design coming out of the meeting with the FDA, if necessary? Just wanted to get a window into your thought process in terms of how you designed the trial. So that's number one.

Number two is with the sales force -- the bigger sales force, wanted to ask how you're thinking about DTC. Are you taking -- are you going to take a more expansive approach to DTC? And that's particularly in the context of your competitor being fairly aggressive here. So I wanted to get your thoughts on that.

And then lastly, on 108, real quick question. I think you made a comment in the press release about indication selection. So I just want to be clear, is it going to be alopecia areata, or are you thinking about other indications or maybe pivoting to something else? I just wanted to clarify on that.

Sure, David. So let me take the sales force DTC question first, and then I will hand it over to Matthew to talk about trial design, especially on the PK side and how we can be ready for any modifications if necessary.

So from a DTC perspective, we still believe that DTC is best served once you have a reasonable market share. And we also have a competitor, to your point, is spending a lot of money on DTC, which we see growing the overall market. So it's growing the auto-injector market. So we continue to believe, let the competitors spend money in that area. We focus on our touches directly with reps.

Let me pass it over to Matthew on your question number one, which was a trial -- how we settled on our trials on if we have to make modifications.

Thank you very much for the question. We have the optionality of doing 2 things at the same time. So upon looking at the FDA's request, we have a trial design that's in line with what the information they want to seek. And we also believe, based on our 11 other PK trials that we've done, that we have enough information to categorize some of that information. And with the updated human factors research that we're going to do, we believe that maybe not all the arms are going to be necessary.

But if the FDA at the meeting [indiscernible] trial design to be exactly what they asked in the CRL, we are also ready to do that. So at the end of the FDA meeting, we're going to have the clarity for the trial design. We already have protocols to take optionality into account. And we will meet our commitments that Dan has already stated for the finishing of the trial and the resubmission of Anaphylm.

And let's -- I'll actually stick with Matthew here for the third one, which is the indication selection for 108. I will say alopecia areata remains that the indication we're focused on, but Matthew can give us his thoughts on as we go through the development process, if there are other opportunities we might see.

I'm going to elaborate more once we've got the results of the current trial that we've done. But the 50,000-foot view, not only did we look at alopecia areata, we also looked at healthy normal patients and looking at the products pharmacokinetics and safety and other factors like proteomics, this will help inform us on future indications. So more to come on that. But we're making sure we have optionality to continue on with alopecia areata and also look at other topical indications that 108 would be designed for.

Our next question, coming from the line of Francois Brisebois with LifeSci Capital.

I was just wondering, in terms of the added reps here, the 50% more reps, can you remind us when you -- the timing of the hiring here? Is this kind of a post-approval or pre? Or just remind us what you're thinking?

Yes. Thanks for the question. Yes, we will continue to follow the same path that we were prepared for a launch this year. We will be interviewing and going through the process, so that once -- with candidates, and so that once we do have approval, then we would flip them immediately to full-time employees. So think about it the same way, contingent offers go out and we're ready to go upon launch.

And Frank, I'll just add to Sherry's comments, just like before, that doesn't delay our launch at all. So there's a natural period of a few weeks after approval, as you know, where the supply chain has to kick in. And Sherry and her team have done a great job of being ready to strike during that period and make sure we have all of our reps ready to go by the end of that supply chain work.

Okay. Great. And then if I could follow up, just any updates on the citizens petition? Where does that stand? And then maybe if you can also touch on -- you were just at AAAAI, I assume it was a busy weekend. I was just wondering any takeaways from your perspective on how AAAAI went for Aquestive.

Sure. Yes. So the citizen petition that was filed by a competitor was denied by the FDA last week, which to us, obviously, it was what we expected, but it's just -- it's another validating point for our data package. So in addition to the strong outcome and the derisking event you saw out of the CRL where it's focused on human factors, we also now see just a matter of a couple of weeks later a moment where the FDA is once again validating the strength of our package.

So we feel really good about where we are with the FDA, especially from a clinical perspective. As you heard from the team, we're on track and we're ready to go.

In terms of AAAAI, which was last weekend, for those who are not familiar, and that is the biggest allergy conference in terms of attendance in a year. My biggest learning, and I'll toss it over to Sherry in a second too -- you know what, let's actually let Matt Greenhawt join in as well. So in a second, I'll pass it over to Matt instead of Sherry.

But from my perspective, what I heard consistently were 2 things. One, the allergist community believes in our ability to get to approval, given what was in the CRL. And two, they can't wait for our product. So very excited on both those fronts. So Matt, maybe you could give a couple of your thoughts.

As usual, the AAAAI is a very busy and intense meeting. There's a lot of allergists, not only from the U.S., but globally, so it's a good draw. What I observed was a lot of excitement and curiosity about a new option for treating patients. As a practicing allergist, something like this adds a lot of potential to how we can observe patients. So to be able to interact with allergists and other people coming up to the booth and seeing us walking through the halls, the feedback I think is very consistent with what Dan just said, that there's excitement, there's curiosity.

So it's exciting. In a year from now, I think it will be even more exciting.

Our next question, coming from the line of Andreas Argyrides with Oppenheimer.

A couple from us here. So how are you viewing the requirements of the PK study is diverging from previous PK studies, including chewing and with or without water intake? How are you thinking about addressing the FDA's concerns around tolerability despite what you point to are minimal cases? And you recently presented additional data at AAAAI around diastolic blood pressure [indiscernible] no dip there? Can you elaborate on the importance of these data with regards to the FDA?

Sure, Andreas. So I'll spread the well with these 3 questions. I'll have Matthew in a second to talk about the requirements from PK versus prior, including chewing. I'll ask Matt to talk about diastolic blood pressure, and then I'll finish up on tolerability. But Matt, why don't you start?

So this will be our 12th pharmacokinetic trial on this product. So like the other studies, we're going to use the same vendor that we had excellent experience with. We're going to use the same laboratory that we had excellent experience with. We're going to, as the FDA requested, have all patients have health care administered Anaphylm. Like the FDA requested, we're going to have all patients also have injection of IM manual epinephrine. And we have done this for our other pharmacokinetic runs.

As the FDA requested, we're also going to have patients -- some patients receive self-administered epinephrine, Anaphylm, that is going to follow the new updated instructions for use that are going to be tested and validated in human factors [indiscernible]. In addition, the FDA has requested top of tongue, and that was by far our largest observation in the last human factors trial. And of course, we'll be doing this.

We'll have a discussion with the FDA on your other question on chewing. And we believe that this information can already be informed in the labeling by the fact that patients have already been tested and swallowed Anaphylm with 8 ounces of water. And we do -- and those patients did reach a therapeutic level of above 100 [indiscernible] per milliliter. So we'll have that discussion with the FDA. If the FDA believes that we have enough information to inform the label, as we believe, then we'll receive the design that I just stated. If the FDA would like us to continue with the design that they stated, we also will do what they request. Either way, we're ready for this trial.

And Matt, if you could talk a little bit about how you think about diastolic blood pressure and [indiscernible] other products in the space.

Diastolic blood pressure is one of these interesting things clinically. You need your diastolic blood pressure to help maintain getting blood to your coronary arteries [ during ] shock. So one of the things that's been observed now for a number of years with additional data with auto-injectors is that the injectable route, you see a slight dip for a couple of minutes where the diastolic blood pressure goes down and then it comes up.

Anaphylm operates a little bit differently than that in that there is no initial [indiscernible]. So what that may lead to is potential improvement in something called mean arterial pressure, which in like shock, it's distributive shock. You think about your plumbing system, there's runoff downstream and there's low pressure. You want to increase your mean arterial pressure. It will help perfuse your coronary, it will keep the system running at a higher pressure. When you're resuscitating a patient, that's really what you're aiming for.

So these seem to be fairly ideal properties that one would want on paper for how you can resuscitate somebody. And it's exciting to be able to report those data. These are very interesting studies and you learn a lot about sort of the epinephrine space, which -- each of these studies that gets reported.

And Andreas, let me take the tolerability piece. So one of the things we didn't overly focus on in our original submission is what tolerability looks like across all of the products. So it's interesting when you step back and you look at the experience with the medical devices, there are multiple tolerability issues that occur, and we don't need to go into the specifics for each product on this call. So in our resubmission, we'll definitely be making sure we characterize our product versus the alternatives that are available.

And then as we stated in the supplemental material that you can see, if you go back to our study, there's very few cases, there's 4 individuals who had any ability to point to tolerability. One of the individuals who said, unprompted, my life was at risk, I would leave the product [indiscernible] as long as they needed to. So I think on this issue, I would put it as much ado about nothing. And we'll make sure that we better characterize the current state in this space in our resubmission.

Our next question, coming from the line of Raghuram Selvaraju with H.C. Wainwright.

Firstly, I was wondering if you could comment on any fundamental changes in your anticipated promotional campaign for support of Anaphylm as and when the product gets approved in the context of the revised sales force sizing, and if you see any recent moves by the folks promoting neffy that would guide promotional decisions that you're making in advance of the Anaphylm launch.

Sherry, do you want to take that?

Sure. Thanks so much for the question. As Dan mentioned earlier, our commercial infrastructure has mainly stayed intact. And so because of that, it is giving us time to go back and really refine our launch plan, aligned with having 75 reps and being well positioned if Anaphylm is approved by the FDA. I do think though that it continues, as you know, to be -- there is a significant unmet need in what continues to be a growing market. And as we have mentioned, with the competitive DTC, they continue to grow the market. And so that's a really positive thing.

But there's still a need for an oral, easy-to-carry, easy-to-use non-needle non-device. We heard it over and over again this weekend at AAAAI. So what I would say is there are not fundamental changes in the work we're doing or the messaging, but we are taking the time, Ram, to really refine our positioning and refine all of the tactics that our reps will take to launch.

As it relates to the competitors, look, we are always looking at the tactics, the promotional efforts. And it is informing us looking at their share of market and evaluating what is working and what is maybe not working as well. And so that is all going to inform our launch plan.

Very helpful. Secondly, I was wondering if you could just clarify how you're thinking about the time line for future clinical development of AQST-108 relative to the time line for the Anaphylm NDA resubmission and potential approval and launch timing for Anaphylm. Are you thinking about these 2 things completely independently? If they are connected in any way, can you give us a sense of how? And maybe just provide some granularity regarding the timing with which you expect to conduct the next stage of clinical development with AQST-108.

Yes. No, thanks, Ram. And look, given maybe the size and the focus of our organization, the only answer to this one is they absolutely are linked. And Anaphylm is always going to win when there's a competition between Anaphylm and 108. I'm lucky to sit in this room with some great executives as you've heard this morning, but they're the same executives who [indiscernible] 108.

So we will prioritize Anaphylm, both from a resource perspective and a monetary perspective in the short term. Having said that, we do have the ability to keep 108 moving, to keep learning, as Matthew talked about, around what we've got on our hands and how many different ways we can use it, and to keep progressing it clinically. Once we get past the Anaphylm resubmission and we really hand over Anaphylm to the commercial side, I think that's when you'll see the workload on 108 pickup with our development team.

Okay. Great. And then just 2 very quick ones. Can you indicate perhaps through the commercial evidence with regard to at least 1 or more of the diazepam-based formulations that are currently available on the market, if this provides any kind of market intel or foreshadowing as it were of what the future peak sales potential could be for Libervant in the United States? And then also if you could just clarify for us whether the specific amount of the settlement with Neurelis was actually disclosed.

Yes, I'll start with the second one. Unfortunately, it tends to happen with these litigation settlements, it's confidential, so we can't disclose the settlement terms. Obviously, you can see our financial disclosures and make your own assessment.

What I would say is, we put into our press release, is what we were happy about and what led us to getting to the settlement is, from a 2026 perspective, we believe it is cash-neutral. So whether we had done the settlement or not, same place on cash.

In terms of Libervant and looking at that opportunity and what peak sales could be for Libervant, this one's bittersweet, Ram. I would love to launch Libervant. And we have put our heart and soul into what we believe is a great product that will help patients in this space. But we can't launch Libervant and Anaphylm within a month of each other. It's just not humanly possible for companies even much larger than us. So we've made the decision that Anaphylm is the priority.

We do have some great potential partnerships, licensing opportunities that our team is looking at. And I do think that if you look at how [ Veltoco and Nazolam ] have penetrated in that market, there's still a great opportunity, especially where portability, convenience, speed of use are important for this product to become an important component in that space.

Our next question, coming from the line of Thomas Flaten with Lake Street Capital Markets.

Are there any current analogs that give you some faith in a potential accelerated approval? I know FDA in its current incarnation can be a little bit confusing.

Sure. That's an easy one. Our competitor. Our competitor got a CRL and resubmitted with a 6-month clock and got their approval in 4 months. So we'll do it nicely, but we will definitely be reminding this review division that they did that, and that our expectation is we're handing in a very thin package to meet their requests and it shouldn't take 6 months to review. Now whether they act fast or not, Thomas, to your underlying point, is completely up to them.

Got it. And then is it safe for us to assume that any submissions outside the U.S. will be after the full package has been resubmitted to FDA, just time line?

Yes. We're guiding that Europe and Canada will be in 2026, but they will come after U.S. Canada, literally, we could put in whenever we get it done, but it's just got to come after the U.S. So some of this is just making sure we prioritize the U.S. over everything else.

Got it. And then I guess, regardless of approval time, could you clarify a little bit, because I know there's a few things going on, including hiring of reps, some of the product-related work you have to do, so from approval to full commercial launch, can you give us a sense of what the timing will look like?

Yes, approval to -- if by full commercial launch you mean reps in the field and product in distribution, I think it's the same time line we guided to this last go around, which was, if you think about it, around an 8-week window. So the -- what it precisely is under 8 weeks is all dependent on how much we lean forward ahead of approval. So call it 0 to 8 weeks.

And I'm showing no further questions in the queue at this time. I will now turn the call back over to Mr. Dan Barber for any closing remarks.

Thank you, Olivia, and thank you, everyone, for joining us today. As you heard, we are on track in every way right now. The epinephrine market continues to grow, and we're excited for patients to have access to Anaphylm as soon as it is approved by FDA.

We look forward to keeping you updated on our progress in the weeks and months to come. And with that, Olivia, let's end the call.

Ladies and gentlemen, this concludes today's conference call. Thank you for your participation, and you may now disconnect.

Good day and thank you for standing by. Welcome to the Aquestive Therapeutics conference call. [Operator Instructions]

I will now hand the conference over to your speaker host for today [indiscernible]. Please go ahead.

Thank you, operator. Good morning, and welcome to today's call. On today's call, I'm joined by Dan Barber, Chief Executive Officer; and Ernie Toth, Chief Financial Officer, who are going to provide an overview of the company's recent business developments followed by a Q&A session. During the Q&A session, the team will be joined by Dr. Gary Slatko, Interim Chief Medical Officer; Melina Cioffi, Senior Vice President, Regulatory; Sherry Korczynski, Chief Commercial Officer; Cassie Jung, Chief Operating Officer; and Dr. Matthew Davis, Chief Development Officer.

As a reminder, the company's remarks today correspond with the press release that was issued this morning prior to this call. In addition, a recording of today's call and related supplemental materials will be made available on Aquestive's website within the Investors section shortly following the conclusion of this call.

During the call, the company will be making forward-looking statements. We remind you of the company's safe harbor language as outlined in today's press release as well as the risks and uncertainties affecting the company as described in the Risk Factors section and in other sections included in the company's annual report on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K filed with the U.S. Securities and Exchange Commission.

As with any pharmaceutical company with product candidates under development and products being commercialized, there are significant risks and uncertainties with respect to the company's business and the development, regulatory approval and commercialization of its products and other matters related to operations. Given these uncertainties, you should not place undue reliance on these forward-looking statements, which speak only as of the date made. Actual results may differ materially from these statements.

All forward-looking statements attributable to Aquestive or any person acting on its behalf are expressly qualified in their entirety by this cautionary statement and the cautionary statements contained in the press release issued this morning. The company assumes no obligation to update its forward-looking statements after the date of this conference call, whether as a result of new information, future events or otherwise, except as required under applicable law.

Now I would like to turn the call over to Dan.

Good morning, everyone, and thank you for joining us today. As you saw in our press release this morning, on Friday afternoon, we received a communication from the FDA regarding our Anaphylm dibut epinephrine Sublingual Film application. This communication was a Complete Response Letter, or CRL, indicating that Aquestive should conduct additional work prior to receiving FDA approval for the marketing of Anaphylm. We have provided the exact language from the CRL, along with our comments in our supplemental materials, which can be found on our website. We would expect the FDA to publicly release the official CRL letter in its entirety in the coming weeks.

Let me start by saying we feel validated to say that the FDA cited no deficiencies regarding pharmacokinetic or PK bracketing, repeat dose safety and sustainability of Anaphylm's performance. There were also no CMC comments. We believe this indicates we have adequately convinced the FDA on major CMC, safety and efficacy data for this program. While we are disappointed that we must conduct additional work prior to approval, I want to congratulate the medical, scientific and engineering professionals who have been on an almost decade-long journey to gain the FDA support for an orally delivered anaphylaxis treatment.

We have developed the most robust epinephrine clinical database in the world to prove our science. And from the CRL received on Friday, we have achieved this major milestone. Having said that, we were frustrated to see the packaging, use, administration and labeling feedback collectively known as human factors that was received in the CRL.

Our view is that there was sufficient time to conduct these discussions during the review. We believe feedback on these items during the review process would have afforded us the opportunity to appropriately amend our NDA and risk mitigate these concerns and obtain a first round approval. In fact, we already had alternate pouch openings and supportive human factors data available for the FDA, had they engaged in these discussions. Unfortunately, we never received information requests on the human factors deficiencies received in the CRL.

Regardless, let me walk you through the feedback from the FDA's human factors group called the Division of Medication Error Prevention and Analysis or DMEPA. DMEPA is concerned that individuals will have trouble opening our pouch and may also tear the film while opening it. In our human factor validation study, only one individual did not open a pouch. This individual was a child, and it should be noted that we are currently using a child-resistant pouch. We had 6 instances of participants tearing a film while opening the pouch. All 6 instances resulted in the individuals fully dosing the torn film.

We also want to remind everyone that we have shipped over 2.5 billion doses of products to 5 continents over the last 15 years. And after digging deep into our product complaint data, we only found one complaint related to a film being potentially torn and no data on difficulty opening the pouch. Having said that, we have previewed a revised opening mechanism to the FDA, and believe use of this alternate opening will meet the needs of the FDA.

DMEPA is also concerned about film administration location and sites chewing of the film. I should point out that 4 individuals out of 166 in our human factors validation study were recorded as chewing the film. Of those 4 individuals, only 1 was provided with the instructions for use prior to dosing. In reviewing the study videos, it is clear the individuals did not read the instructions on the pouch. Revising the pouch to include pictures should improve administration in those who did not read the instructions. Either way, we believe epinephrine absorption will still occur in the oral cavity and gastrointestinal tract. We have also demonstrated through our clinical studies, that there is a wide range of acceptable placement for the film.

DMEPA pointed to tingling, burning and taste as potentially leading to premature removal of the film. At a top level, they refer to this as tolerability. Let's dive into this for a minute. In our 11 clinical studies, including pediatrics, we had 0 instances of film removal. In our human factors validation study, we had 4 participants who removed the film. None cited the reason is tingling, 2 cited taste and 2 cited a burning sensation. Keep in mind, these participants were in a low-risk, healthy environment and had no need for the medication.

As 1 of the 4 individuals said during the study, "I don't like the taste of mint. But if we had to save my life, I'd even leave the film in for 10 minutes." Regarding the burning sensation, one of these participants administered 2 doses sequentially in an effort to get through the simulation quickly. As I stated earlier, engagement from DMEPA would have allowed us to discuss and explain this data.

The FDA also provided us with a variety of labeling updates for our instructions for use and carton labeling. We were pleased to see labeling items in the CRL and we'll implement these in our revised submission. These label updates will be confirmed for their effectiveness in the human factors validation study, the FDA is asking us to conduct. As of this morning, we have already designed the protocol, and we'll look to move this forward rapidly.

The other additional work needed is a simple, easy-to-perform pharmacokinetic study that ties to DMEPA's feedback about film placement. While we have already evaluated this and again, believe this is unnecessary and repetitive, we see no issue in performing this work and providing it to the clinical team. We can do much of this work in parallel to the human factors study. As a reminder, we previously conducted a PK study on the impact of swallowing the film.

So what does all of this mean for Aquestive and more importantly, for Anaphylm? Well, from my perspective, this CRL, while unfortunate and seemingly unnecessary, represents a major derisking event towards approval. We have a straightforward path to resubmission and expect to do so by the third quarter of this year. We will also work with the FDA to press for a rapid review and approval of Anaphylm once submitted to the FDA.

In the meantime, we will continue to build our medical affairs presence and prepare for launch. We will also progress our ex-U.S. filings and anticipate filing in both Canada and Europe this year. Finding the right distribution strategy and/or partnerships in both markets will now be a priority.

With that, operator, please open the line for questions.

[Operator Instructions] Our first question coming from the line of Roanna Ruiz with Leerink.

A couple of questions from me. First one, could you talk a bit about the resubmission time line? And are there any gating factors that you definitely need to complete before that and when you're thinking about planning for it?

Sure. Roanna, you said a couple of questions. Did you have another one? Or do you want me to answer that one first?

My second one was bigger picture. Just thinking about Anaphylm's launch trajectory with the new potential approval time line, like how would you think about that going forward as well?

Got you. Okay. Thank you. Thank you for the questions. In terms of the resubmission time line gating factors, as we laid out in the press release, the 2 things that we need to accomplish prior to resubmission are a human factors validation study and a single pharmacokinetic study using the revised instructions that were used in our human factors validation study. At this time, we see no other gating factors to getting to a resubmission.

In terms of the bigger picture in our launch trajectory, I'll turn that over to Sherry Korczynski, our Chief Commercial Officer, here in a second. What I would say is, if you look at the market right now, the vast majority of the market remains auto-injector, and we believe that will continue to be the case in 2026.

Thanks, Dan. Roanna, yes, as Dan mentioned, the market continues to grow. And if we look at what has happened over the last 18 months, patients, caregivers, HCPs are looking for choice. And the vast majority does remain in epinephrine auto-injector. So as we look at it, our investment in commercial in 2025 will be relevant to our new time line. We will be absolutely commercial ready.

And just one aside, we've been going through rounds and rounds of market research over the last 3 to 4 months. And I have to share with you, seeing is really believing. When we send samples of our demos of Anaphylm as well as the other products on the market, when a patient sees, feels, touches Anaphylm as well as the other products, 96% of the time, patients are choosing Anaphylm. So we absolutely believe the market with continued growth will be ready for our launch when we do launch the product.

That makes sense. And a quick follow-up for me. You alluded to this a little bit. You had an idea of how you wanted to design the human factors testing and the PK study. Are there any other details that you could elaborate on just to help us understand what it looks like?

Yes. The details of the design we will definitely be talking about in the weeks to come. Just let's talk about the process for a second. We first have to take those details to the FDA in a Type A meeting request, which Melina and team will be doing very quickly here. And then we'll, of course, be sharing that with the world. What I would say at a top level, these are pretty simple designs. This is not a hard lift.

Our next question coming from the line of Kristen Kluska with Cantor Fitzgerald.

Sorry to hear about the CRL, but genuinely very appreciative of how transparent you've been with us, including with the letter last month. So on the PK pharmacology work, can you give us a sense of whether or not you see any risks into the study? Do you suspect it will read out similar to what you did the first time around, especially now that there's the potential that you don't have to worry about any of these situations where the film either rips or people are not administrating it correctly, et cetera? And then I have a follow-up.

Sure. Yes. So we have -- let's back up to what we've done to get here, right? And then I actually -- in a minute, I'll throw it over to Gary, who can give you some of his thoughts as well. We've conducted 11 clinical PK studies over the last few years. So this will be study #12. We know our film inside and out. And while there's always risk with any clinical study on anything in this industry, we believe we understand the clinical pharmacology of this product very, very well. So we think the design is straightforward. We think the process is one we know well and one that we have been successful at through the first 11 studies.

But Gary Slatko, our Interim Chief Medical Officer, I'll let him share his thoughts.

Yes. I think reading the CRL, it just defines a clear path for us to follow to gain approval. The response gives us great confidence in the PK profile of the product and the safety profile, and it tells us that the FDA concurs with that. So a lot of the uncertainties are being removed by the information, the feedback that we're getting from the agency. And many of the things that we -- there might be uncertainties are -- they are open the door to the labeling as a potential path of addressing those uncertainties. So that's a good news story because labeling is the end of a process of agreeing with the agency about how the product can be used effectively.

Okay. And can you confirm your understanding about whether it will be a single or repeat dose study? And then on the tolerability aspect, you alluded to 2 patients describing it as burning and 2 just outright not liking the taste of mint. I guess how do you address that in a trial? Do you just give people more of a heads up about what to expect from the flavor?

Yes. Thank you, Kristen. In terms of a single versus repeat, the letter, which, by the way, in our supplemental materials, everyone has the letter. So we didn't leave anything out. The FDA does not request or require a repeat dose. So they leave it up to us. So that will be something that the team determines, puts before the FDA, and then we'll, of course, share with all of you the exact design of the clinical study.

In terms of tolerability, I'm glad you asked that question because as you can imagine, and I'm sitting in our conference room with the entire team here, we spent the weekend talking about the path forward and also looking at videos from our human factors study. So really trying to understand the FDA's position or the DMEPA's position on tolerability. And I have to tell you, when you see how people react, it's not what you would think when you think about a bad tolerability case.

I'll go back to the individual -- I put in my prepared comments. The individual is just providing information. So they are just -- they're a teenager sitting in a room, being told to do something, they do it. And they say, Oh, yes, well, I don't like the mint flavor, but I would do it if it is going to save my life. So I think context is really important here. And one, we never had the opportunity to give that context. But now that we have the opportunity to rerun a study, you're right, there are things we can do to make sure that the subject is more prepared. And we'll, of course, put those in and give better context to the FDA of what we're actually experiencing in our validation studies.

Our next question coming from the line of David Amsellem with Piper Sandler.

So a couple for me. First, just wanted to clarify that this additional PK study, is it going to have any repeat dosing? Or is it not going to have repeat dosing? That's number one. Sorry if you addressed this, but I just wanted to make sure I'm clear, so clear on that.

And then secondly, I'm just trying to get inside the head of the FDA regarding "tolerability" here. Are they just simply worried about incorrect placement of the film and potential swallowing parts of the film that causes tolerability issues? I just want to better understand what are they hung up on regarding tolerability, particularly since you've done work where the film has been swallowed at least in whole or in part. So just help me better understand what you think their thought process is here? I'm sorry if that came off as a loaded question, but I'm trying to better understand this.

It doesn't, David. I think it's a very fair question and I appreciate it. So first on the repeat dose, I'll lean forward for the clinical team. I was trying to give them space to do their work that they need to do over the next few weeks. But right now, we don't see a need to do a repeat dose. So while it's always something we have available to us, the FDA is not requiring it, and we don't see why we would do that.

In terms of tolerability, I would divide it between 2 groups, right? From a clinical perspective, we think the clinical pharmacology team is bought in. We -- in the prefiling process and during the review, as Melina has talked about before, with the clarity we went through with the clinical pharmacology team, we talked a lot about tolerability, and we think they're sufficiently bought in.

We think the tolerability comes down to, again, DMEPA group, the human factors group. And we think what they're talking about from what we see in the letter is will people remove the film once they put it in their mouth, which is why we went to, well, how many people did that in our clinical studies, none. In our human factors study, 4. When we look at those 4 individuals, again, 3 of them didn't even have the instructions of what they were supposed to be doing. So we think this is about communicating how our product is administered, not that there is an AE tolerability issue with the program. We believe that has been settled.

Okay. That's helpful. And if I may just sneak in one more. Just to be clear, the DMEPA group, are they -- so they mentioned removing the film. Were they also concerned about potential swallowing of the film? And I would imagine that's something that's readily addressable via instructions for use. Is that a good way to think about it?

Yes. I don't -- my personal opinion, and I'll look to -- I'll actually give it to Melina in a second here to give her view. I don't think the human factors group would be the one that would really have to be concerned about swallowing. I think that would be clinical pharmacology. And look, we've already done that work for them, right? But Melina, I'll let you give your thoughts.

Sure. So I would absolutely agree. We've done these 11 studies really with the intention of fully characterizing our PK profile under conditions of real-world situations. So that was really driven by the clinical pharmacology and clinical team overall. And that really is the intention in my view, of what this additional study would be looking for. But from a DMEPA perspective, it's really with respect to appropriate administration.

Okay. And then just last quick one for me. Just to be clear, there were no issues raised on safety, nothing about blood pressure, heart rate elevations, anything like that. You can be -- you're confident that, that's essentially an issue that's not at all problematic?

Well, let's focus on that for a second, and I will give it to Melina in a second. I'll first preface it by saying not a single word, but I'll let Melina explain to you or explain to other people because you probably already know, David, what that means.

Sure. So a Complete Response Letter is intended to be a complete outline of any outstanding issues or questions that the agency has upon completion of the review. So the absence of mention of things like the repeat dose safety, sustainability, overall safety profile certainly implies that the review has completed and there are no major objections, concerns or issues.

Our next question coming from the line of Andreas Argyrides with Oppenheimer.

So it seems from the answer to questions in the prepared remarks that you feel like the PK pharmacology work is somewhat trivial. But just maybe since -- and also that you guys can conduct this kind of at your discretion, maybe you can give us a sense of how you're thinking about it initially, the multiple arms? Or do you plan to conduct it under bracketing, especially in the comparator setting? And you did say these are pretty feasible. How long -- any sense of how long they'll take and what age groups might need to be conducted? And then just -- you said you had a better container design to begin with. Maybe your thoughts on your decision not to kind of preemptively submit those? What were some of the considerations around that? And then maybe one more follow-up.

Well, I'll start with the end, and then I'll hand it over to Matthew Davis, our Chief Development Officer, to talk about the PK study in particular. But let me be clear on the foil opening. We are always looking to improve our foil opening, right? And we have done that work in the past, and we did submit it to the FDA during the review process. And they were -- at the point we submitted it, they did not look at it in this review cycle. So that was frustrating to us, but it is what it is, and now we'll do the work to get to the approval.

In the meantime, I'll let Matthew talk about the PK study.

Well, thank you. Firstly, I just want to acknowledge we have a highly experienced clinical operations team. This will be their 12th PK trial. o this is something that we've done. We know how to do. We have excellent vendor partners. So we're also very appreciative of the FDA, very clearly they mapped out the design that they wished. So they want us to look at showing and without swallowing, they want us to look at alternate sites, and they want us to be informed by our human factor trial and allow for self-administration.

The FDA requested that we had an injectable comparator. And also 1 other additional thing the FDA wanted is for healthcare practitioner placement. So the film to be placed on the participant. They're allowing us to do parallel or sequential design. And we're going to pick the design that works out best for the information gathering, the time lines, and that would also be reviewed at this Type A meeting.

Our next question coming from the line of Raghuram Selvaraju with H.C. Wainwright.

Just wanted to break this into 3 different topics. Firstly, if you could comment on the projected size and scope of the human factors and PK studies in terms of what you anticipate to be the estimated total number of subjects that you will need, if it's possible for you to provide us with any granularity on that point.

Secondly, I was wondering if you could maybe clarify what the status is of dialogue around a potential label. And even though the original communication you got from the FDA that was disclosed prior to the receipt of the CRL indicated factors that precluded labeling discussions at that time, it appears from the press release that the FDA has, in fact, provided you with commentary on a potential label. So I just wanted to see if you could just characterize for us at this point what the status is of discussion around the potential label for Anaphylm.

And then lastly, given the need for additional data to be provided as part of the resubmission, can you clarify for us that, in fact, this would be classified as a Class II resubmission? And in such a situation, if that would essentially imply the potential approval of Anaphylm in 2027 as opposed to before the end of 2026?

Sure, thanks for the questions. In terms of the size and scope of the studies to be run, I'll first ask Melina to talk about the size of the human factors study, and then Matthew can comment on the PK size.

Sure. So the human factor study expectations are outlined by the agency in human factor guidances. And the expectation generally is that it would be 15 participants per arm. So we would be expecting about 75 participants overall.

And Matthew?

When you think about pharmacokinetics, you think usually about 18 to 24 participants per arm. So if you go in a parallel design with 3 arms, which the FDA is allowing us, a chewing arm, an alternate site arm, and a human factors arm, you would have 3 arms with that bracketing. That was bad choice of words, 3 arms with that amount of participants. If you go sequential, then you would only need anywhere from 18 to 24. We'll look and see what's best for getting the data to the FDA, and we will discuss that at our Type A meeting.

So Ram, clearly, within the usual size of studies we've performed in the past. In terms of clarifying the status of the dialogue on labeling, yes, we obviously -- this weekend was a strange weekend for us as a team, both frustration as well as obviously excitement over the places we have alignment. Really interesting to see so much labeling in the actual CRL labeling feedback. So while we can't have an active dialogue right now, while we're waiting for the process as we go to the Type A, Melina and team will definitely be engaging in more of those discussions.

Melina, was there anything you wanted to add to that?

I would just add that the feedback from my experience, the feedback that we received in the letter, the CRL would normally be given during the review. And so in terms of the status of the discussions, it's quite unfortunate that we were unable to have those conversations during the review process, because, again, those are commentary that would normally be discussed towards the end of the review.

Yes. In terms of the classification, yes, of course, you have it right. The -- just to provide a little more detail, the standard review time after submission with the clinical data we'd be putting in is 6 months. Having said that, I do want to remind everyone that in this particular category with this particular review group, a competing product had a 6-month clock and got approved in 4 months. So we're very aware of that. We will be pushing hard, and we'll see what happens.

And then just one quick follow-up. Do you anticipate being able to conduct the Type A meeting before the end of this quarter? Or would it be more reasonable to assume that it could conceivably occur early next quarter?

Look, we're going to move as fast as we can. The Type A meeting process with the FDA is designed to get us in front of the review team quickly, and we're going to do that as quickly as possible.

Our next question coming from the line of Francois Brisebois with LifeSci Capital.

Is there this kind of lack of communication here with the FDA, is this somewhat maybe related to the shutdown or anything? Is it a different crew with the FDA? Or -- because it just seems like a lot of this could have been taken care of if the communication had been better. So is there any insight there at all?

Frank, your guess is as good as ours. What I would say is -- and you've heard Melina say multiple times over the last year that the review with the clinical team up until in December when we received the deficiency letter was very, very good. I think our best guess is that the clinical review team was following protocol based on whatever debate was happening inside of their 4 walls, and we just weren't -- we weren't allowed into the discussion.

Okay. And then the -- it seems like swallowing came up there, but you guys have shown data there. Can you just maybe touch on a couple of things that you mentioned kind of the childproof feature of the package? And is that something that would be worked on? Or it's just more like let's read the directions better and whatnot? And then just touching on the swallowing coming up again and then the chewing aspect that you mentioned there. Just remind us what you said and why you feel comfortable there.

Yes. I think the relativity is the first place to go. Remember, the hundreds of people who have gone through our clinical studies and our human factor studies, and we're talking about 4 individuals, right? So we're talking about a very small number of individuals to begin with. In terms of improvement, there's always improvement to be made, and we will, as time goes on, we just -- we couldn't focus on it at this weekend. We will share with everyone the revised pouch that we're considering and the revised opening. And as time goes on, we'll probably continue to improve things.

But just to give you an example, our -- the pouch we studied in our initial human factors validation study did not have a picture on it. The new one does. So simple things like that really help people to better understand if they're not going to take the time to read the instructions. So we feel very good about our ability to continue to improve on the human factors side.

In terms of swallowing, look, we've already outlined work in our initial clinical studies. We've done that work. Our read of it is the clinical team is well on board. I think they just want verification with the new instructions. So we don't see swallowing in particular as a major hurdle or something that is problematic in the CRL.

And as you've mentioned, maybe my last question is you guys have been through a lot of this. You've produced these types of Sublingual Films and buccal tests for a lot of different companies now. Is this packaging something that had been used in other products and just never came up with the FDA? Or is there any surprise here? Is this more of an emergency situation or whatnot?

Yes. I'm only chuckling, Frank, because it's unfortunate, but this opening is the one we use with multiple other products that are on the market and one product that's been on the market for 15 years. So -- and as I laid out in my prepared comments, there's no data in our product complaint, and I probably should define that a little bit better for everyone. So as -- when you're a company that produces product and puts it into the market, there's a 1-800 number, as everyone knows, on your product and complaints can come into that 1-800 number.

As the manufacturer, we're responsible to respond to -- review and respond to all complaints on our products that are out in the public, right? And when we look at the products that we have in the public domain, including with the opening that we're using on this product, we don't find complaints on tearing the film or having difficulty opening the pouch. So it's a bit of a head scratcher, but we'll do the work as the FDA has requested.

Okay. Great. And then, I guess, maybe the last one. I think Ram mentioned it, but the timing there, so you mentioned that based on the data that you have to present and all that, usually it would be 6 months than a competitor had it done in 4 months. Is that normal review? Or is that rapid review like you mentioned in the press release? Or like could it be more than 6 months, I guess, is my question?

No, the most it would be 6 months, but the longest clock is 6 months.

Our next question coming from the line of Thomas Flaten with Lake Street Capital Markets.

Just kind of sweeping up here. Sherry, what impact is this going to have on recruitment for the sales team? I know you probably had some contingent offers out. But I'm just wondering if you could comment on that, like how much rework you're going to have to do to get those salespeople lined up again, let's say, 12 months from now?

Thanks so much for your question. As you know, and we stated in the past, we were not planning to hire our sales force until approval. And so fortunately, then we did not have to let anyone go. As it relates to recruitment, we were very successful in having our district sales managers, our sales representatives lined up. And so obviously, those will be people we'll go back to first, and then we'll be filling in from there once we get closer to an approval date. Does that answer your question?

Yes. No, that's great. I appreciate that. And then, Dan, a little bit left field, but you did mention moving forward with Canada and EU submissions by the end of the year. I saw that neffy got a positive CHMP opinion this morning. I'm just curious if you guys have been monitoring that and if there are any learnings, what dialogue you've had with the Europeans to kind of advance that program? And any thoughts on that?

Yes. Well, I would say the -- with our program, the FDA feedback we just received is actually way more important for us and where we're going than the competitor information. It shows that the FDA on the big questions that were around our program is bought in. So we think from an EMA and Health Canada perspective, that gives us a green light to move forward rapidly, and which we are planning on doing.

I also do want to back up, Thomas, for a second, if you're okay, and just give Sherry and her team some credit. The work they did in 2025 was phenomenal and will remain available to us as we go to a launch in late 2026 or early 2027 wherever that falls. All the marketing work, all the awareness work, she has a phenomenal team that will remain in place, and we're ready to go on that front.

Got it. And then one quick one at the end. So just from a promotional perspective, I'm assuming -- because this isn't like taking a pill, which anyone can do without too many instructions, I'm assuming you'll have demo units for the doctors to explain to their patients how to use these. And then how important is that going to be, do you think, in reinforcing the fact that people aren't going to not read the instructions because they've already been trained on it by a physician. I know that's probably not what FDA wants to hear, but in the real-world application, I feel that would be critically important to get patients to understand how to actually use the product, where to place it, et cetera.

Yes. Well, I'm going to throw it to Sherry in a second to talk about some of the things we'll be doing in the doctor's office. But let's be clear about the situation here. And actually, Gary, you can probably say it better than I can, when you think about someone who is actually in a crisis moment and has a life-saving drug on them, I mean, how do you think about it?

Well, I think this is a rescue medication, and they are going to do everything they can to administer the medication properly. And most people would get some kind of direction about use through their health care provider or pharmacy or they read the pouch in advance of having an event that would necessitate its use. And once you do it once, you've got it. And so this product will probably be used once or twice a year. People will use it under an emergency circumstance, and there will be a learning and practice effect that patients experience once they have used the product.

And Sherry, do you want to tie that to the office?

Yes, sure. And thanks for the question. We know it is critical for the physicians, patients and their caregivers to know what to expect. And so we have a whole slew of materials that will be available to the offices and to the patients, things like demo films so that they can practice the right placement. So there's not challenges in an emergency situation, QR codes that are able to show how to put the Anaphylm under the tongue, but also things like patient starter kits and training for the physicians, patients, school nurses. So we take it very seriously that it is an emergency situation. And in an emergency situation, we will be providing all of the materials so that they're aware how to use, when to use in advance of a severe allergic emergency occurring.

Our next question coming from the line of Jason Butler with Citizens Bank.

I just wanted to follow up there, Dan, on your comments about crisis situation, rescue medication. Are there any learnings that can be pulled from a tentative approval of Libervant to this FDA conversation? Because obviously, that's also a rescue situation. And then second question, can you give us color on what language or data you had proposed, including in the label from the oral allergen study and if FDA had made any comments on the inclusion of those data in the label?

Okay. Well, let me start with the first piece, and then I'll hand it over to Melina on OAS and what could have been in the label. I would -- well, sure, there's always learnings from any of our film programs, especially a rescue one like Libervant. I would actually point more towards the medical devices that are on the market for this particular indication. Look, DMEPA exists for a reason inside the FDA, right? There are errors. And those errors, especially in medical devices are around misfiring, misuse, misunderstanding, prepping a device when it doesn't need to be prepped.

So that's the lens that DMEPA uses on any product, which, by the way, our product not being a device, actually, technically doesn't require DMEPA review. But -- so they put it under that review. And so we're providing them with the data that they require. But I think when you compare us to the devices that are out in the market, the inherent ability to use our product, I believe, is very good.

But I'll pass it over to Melina to talk about OAS.

So with OAS and the label, yet again, it would have been really nice to have been able to have that dialogue with the agency during the review. But I will just point out that with OAS, again, in the context of this Complete Response, there are no outstanding questions or concerns with respect to that data.

And our next question coming from the line of Jim Molloy with Alliance Global Partners.

This is Laura Suriel on for Jim Molloy. So alongside the info you provided on the Canada regulatory expansion, can you just give a bit more insight on the other global expansion plans you have for Anaphylm, and how the discussions and the planned submissions you have with these other regulatory agencies have been going?

Sure. Happy to. And I'll actually pass it over to Melina to walk you through Canada, EMA and the U.K.

Thanks, Dan. So we have had pre-submission meetings with those 2 health authorities, and we have a clear path forward. Right now, it's just a matter of putting the package together, crossing the t's, if you will and dotting the i's. We do have an upcoming meeting as well with MHRA, and that will certainly inform the path forward in the U.K. as well.

Got it. And also just on the Adrenoverse platform, I believe prior guidance detailed on an upcoming IND filing and the start of clinical development this year. So do you think the new time lines you have for Anaphylm could potentially affect the time lines you have planned for Adrenoverse and AQST-108?

That's always a good question for a small company, right? And I think some of my team is looking at me right now to see how many weekends we're going to have to work this year. So look, it's always a balance, right? We believe in the Adrenoverse. We believe in AQST-108. With the addition of Matthew Davis last quarter, who is doing a phenomenal job as our Development Officer, we have a really good plan to make sure we understand the value, the long-term value of the Adrenoverse platform.

What I would say is in the next 30, 60 days, we obviously have a lot to accomplish on Anaphylm, and we're going to be very focused on that. But given the value and the multiple important products we think are in our Adrenoverse platform, we absolutely will be continuing that work and looking to give you more detail on where that can take us in the years to come.

I'm showing no further questions in the queue at this time. I will now turn the call back over to Dan Barber for any closing remarks.

Thank you, Olivia. Thank you, everyone, for joining us this morning. We appreciate your time. Obviously, a CRL is a very frustrating thing to receive from the FDA and unfortunate in this scenario, given the facts, but we are as confident as ever in our program, what it means to patients and the importance of this product and product choice in this space. And we are steadfast as we put in our press release on making sure we get to approval of approval than we were last week when we were still waiting to hear from the FDA. With that, we will close the line.

This concludes today's conference call. Thank you for your participation, and you may now disconnect.

All right. Well, good afternoon, everyone. This is David Amsellem from the Piper Sandler Biopharma research team. I know it's a real busy day, and we're trying to all get through the heart or really the tail end of the 3Q earnings cycle. We got a lot to cover, though, with Aquestive. And I think this will be a really informative and insightful hour that we'll be spending with the Aquestive Therapeutics senior leadership team. And we really have the whole team here.

We've got Dan Barber, President and CEO; Ernie Toth, CFO; Gary Slatko, Chief Medical Officer; Melina Cioffi, SVP, Regulatory Affairs; Cassie Jung, Chief Operating Officer; and Sherry Korczynski, Chief Commercial Officer. So thanks so much to all of you for joining. I know many of you are at the ACAAI meeting down in Florida, and there will be data presented there in the coming days. So a big forum for all things Anaphylm.

So with that, I wanted to turn it over to Dan just for a quick introduction. And also, I'll start with, as I typically do with these things, a question. So with [indiscernible], also a question here, looking more broadly at the company. Obviously, Anaphylm and getting Anaphylm right is the top priority. But longer term, how do you balance that top priority with other clinical and commercial programs, including the pipeline of epinephrine prodrug platform? In other words, Dan, just as part of the intro, talk to the kind of company you're looking to build over the next several years.

Sure. Well, first, David, thank you to you and the team at Piper for taking the time today to spend with us and let us tell our story and always appreciate it, and it's always a good discussion. So I don't know if I'm setting a record with the number of team members that I've brought with me today. But typically, when we do these conversations, it's myself, Ernie and Sherry. And given where we are in our cycle and the fact that we're close up to our PDUFA date and hopefully our launch, I wanted people to see that it's not just me saying what's going to happen, it's a broad team of experienced people who are responsible for these things and know what they're doing. So I may talk a little less today than typical, which I think is a good thing, because you'll hear what other people have to say.

But from your initial question, which I really appreciate, David, the tone you said at the beginning of, well, where is this company going? What are we all about? What are we trying to be? And Anaphylm, as you perfectly said, absolutely is front and center and will be where our focus is and our resources and our energy. But we are a company that believes we can be bigger than just Anaphylm. And the reason we believe that is because of the technology that created Anaphylm, our AdrenaVerse epinephrine prodrug technology, which, as you've heard me say before, we are the only ones who have patented the ability to absorb and, in different ways, release epinephrine, which we think creates a variety of places that the product -- the technology can be used.

So the way I look at the company over the next several years is Anaphylm is the first proof point of what we can do with AdrenaVerse, and there are a variety of programs yet to come. And when I think about -- if I get really dangerous and think about, well, what does that mean for the value of the company, I truly believe if we do our jobs well and we create the pipeline clinical proof points that we can, that the value of whatever you think Anaphylm makes this company worth, that pipeline should be equally as valuable. So double what just Anaphylm on its own is worth. And that's why it's so important as a company to not just be about one product that you're launching, but about a technology that can produce multiple programs over the years to come.

That's very helpful. Okay. So let's dive in. And I think what's top of mind for investors is the FDA review process. Obviously, you have the PDUFA coming up. So I wanted to start with maybe a backwards-looking question, which is on the regulatory process. Can you just talk to the key items that were part of the safety update to the NDA filing?

Well, I'm very lucky the way we're set up as a company. My office is, I don't know, Melina, what am I, 30 feet away from you? So her and I are constantly going back and forth and making sure we're updated on what's going on. So I will hand it over to Melina to walk you through all of the great work she's done on the NDA side.

Thank you, Dan. So in response to your question, David, focused on the safety update, just to provide a little bit of color to that, it is a required submission for any NDA. It needs to be submitted 120 days following submission of the initial application. We were, in fact, able to submit the required safety update on time within the time frame. The data that's within the safety update is actually not new. It's a representation of data based on information requests and questions that we had early in the review. That said, I would just point out that the review has been active and remains active. So certainly, we received information requests at the very beginning prior to submitting the safety update. And those information requests continue in a very healthy way.

Does the -- just a clarification question. Does the NDA or the safety update to the NDA include the pediatric data?

It does. In fact, the NDA contains a complete data set of the pediatric data.

Okay. That's helpful. So regarding being notified that you would not need an Ad Comm, just wanted to better understand how that safety update played into the agency's decision here. And then secondly, talk generally about your dialogue with the agency from the safety update to being notified about the lack of a need for the Ad Comm. Always helpful to get some context around that decision that was communicated to you by the agency.

Absolutely. And I think by way of background as well, you must appreciate that the possibility of an advisory committee meeting was on the table even prior to submission, and it was reiterated at the time of our filing communication. So going from the time of the filing communication, not only was there the submission of the safety update, but there were a variety of submissions that we made. Specifically, they were responses to information requests that we received along the way. Now we believe that we have adequately responded to any and all questions that the agency had throughout that process, so much so that I do believe that at the point of the mid-cycle review, which is around the time that they had ultimately communicated that decision to no longer hold an Ad Comm, that we have sufficiently addressed any concerns or questions that they may have had that would have led them to ultimately need one.

Okay. And can you talk to the CMC part of the filing, facility inspections and how we should think about where things stand there?

Certainly. So in terms of a CMC facility or any inspection, that is a possibility at any point during the review process. With respect to the facility itself, it is a GMP facility. So we certainly always need to be prepared for inspections. What I can say is that we have received 2 inspections of clinical sites so far. They are part of our pivotal program, and there were no major findings noted following those inspections. And of course, the possibility still nonetheless exists that additional inspections could be warranted.

Yes. Have you had -- or can you say if you've had a pre-approval inspection?

So at this point, what I can say is that the clinical sites have certainly been the focus of the inspection activity thus far.

And just to add on to that, David, we have not had a PAI. And I'll ask Cassie to just opine, we have had the FDA at our manufacturing facility in the recent past. If Cassie, you could just walk through that.

Yes. I think just to add to that, as Melina said, given that we are a GMP manufacturer, right, we're in a constant state of audit readiness. And as Dan just mentioned, we were this year audited by the FDA, just standard unannounced audit, as well as regularly audited by other regulatory bodies, including the TGA. And then, of course, as you can imagine, regularly going through audits with our partners, right, for whom we manufacture and provide product for. So again, we're always in a state of readiness, right? That's part of our business.

Yes.

Are you in labeling discussions?

Melina, you...

Certainly. What I can say is at this point in the review, it would not be expected. We are not at that point in the review process.

Okay. All right. So let's move to the clinical package here. So I have some questions about Cmax. And I think this is something that investors have zeroed in on. So looking at Cmax for Anaphylm, both with and without allergen exposure, so clearly higher than what we've seen for, say, the manual intramuscular injection. So I guess the question here is how should we conceptualize this in terms of safety, clinical implications, if any?

Certainly -- yes, please go ahead.

Do you want to say something, Dan?

Well, I just want to -- I can't help myself, as David knows. There is one thing that people should remember, which is as a company that does 505(b)(2)s for a long time and looks at comparability, the product used in the public domain is the auto-injector, right? So the manual -- and obviously, David, I know you know that the manual IM curve by nature is much, much lower, right? But Gary, I'll let you get into the details.

Right. So the relevant data here is the oral allergy challenge study that we conducted in collaboration with the FDA. Data is being presented at the meeting here. And we saw geometric mean maximum concentration values in the low 400 to upper 300 range in subjects or in patients with or without allergy challenge, respectively. The purpose of this study, which is well above the intramuscular and not -- and fairly close to the range that one might expect with EpiPen in normal volunteers.

Importantly, the study was conducted with the intent to make sure that if a patient experienced swelling in their mouth, that, that wouldn't impede the pharmacokinetic or pharmacodynamic effects of Anaphylm in the presence of symptoms of anaphylaxis that could manifest that's called angioedema. So in the study, we saw robust elevations in the range that we hope to see. In fact, the levels were slightly higher in the presence of oral edema. So that's encouraging, because it suggests that the edema not only impairs the effect, but actually enhances it, well above intramuscular injection and in the range of the auto-injectors. And basically, falling into this range meets the FDA's bracketed target range that they were looking for as an outcome from the study.

Okay. I did want to drill down on not just Cmax, but pharmacodynamic properties. So maximum systolic blood pressure, maximum diastolic blood pressure. So looking at, I think it was your pivotal and which did incorporate EpiPen, not just manual, we are seeing -- and feel free to jump in, but we are seeing what looks to be a greater increase in SVP and DVP for Anaphylm and also pulse as well. So I guess I'm just trying to better understand what's happening here and talk to how you think about clinical implications.

Well, the clinical implications are that in the presence of anaphylaxis, the patient is at risk of circulatory collapse and shock, which is manifested by low blood pressure. So the fact that Anaphylm as well as all the other epinephrines mitigate against that loss of blood pressure is an important pharmacologic effect and desirable effect of administering any of these agents.

The elevations that we're seeing with Anaphylm are within physiologic range. They were all in the mild-to-moderate elevation category. They did occur early, which is, again, something that in something like anaphylaxis, you don't want there to be a delay in the beneficial or the effective -- these effects that we observed. So they occur quite early. And we see this as evidence that the product is achieving its intended therapeutic effect, which all of them do, increasing blood pressure, cardiac output, reducing bronchospasm and reducing edema. So we are actually encouraged by the fact that we're seeing this robust performance in terms of blood pressure and heart rate elevations.

Is it -- I guess the question -- maybe I'll state the question differently, is the elevation in blood pressure, for instance, being higher than the injectable modalities, is that something that could elicit concern on the part of practitioners? And I know that this is all transient and this is in a rescue setting. But if you're getting higher elevations in BP, higher elevations in pulse versus the currently available modalities, however transient they may be, what is the extent to which that could be problematic, not just from a practitioner perspective, but even from a regulatory perspective?

Well, the elevations -- as I mentioned, the elevations we're seeing are in the mild-to-moderate category. None of these were considered severe or in the range that would invoke an intervention by a physician in order to reverse these elevations. They were still in the range of fluctuating blood pressure that one might see in the normal population or patients with controlled hypertension. So we're not concerned about them being severe or too high. And as I mentioned, the pattern of the elevations actually is something we are excited about potentially looking into further following commercialization because it appears that there's not only a significant increase, but it's occurring quite early, which is desirable when compared to, say, the intramuscular epinephrines, which tend to manifest these elevations later on a delayed basis.

So FDA has not raised this as a concern. And so we're encouraged by this. And it's also important to remember that this is being administered in the outpatient setting and by the patient on their own. And if you can satisfactorily control their anaphylactic reaction early in the field, they may not need to be transported in to be seen in an emergency room, that, that would be considered by guidelines to be a sufficient level of response and might actually save them an ER visit or a hospitalization.

Yes. I wanted to actually touch on that, because this is a paradigm where obviously, it could be an emergent situation and require a hospital visit. But my understanding, and correct me if I'm wrong, is that if you've got anaphylaxis and even if you self-administer epinephrine and you get your symptoms under control, don't you have to go to an ED/emergent care setting anyway for examination? Or isn't that sort of advisable?

In the past, the common practice was to take the epinephrine and call an ambulance and be transported to the hospital for a follow-up evaluation. However, fairly recently, in 2023, there was some new guidelines that were issued that basically recommended that if the reaction is sufficiently treated in the field and the anaphylactic symptoms are controlled, then emergency transportation to an emergency room is not necessarily part of the management plan. So that has evolved fairly recently. But you're correct, in the past, it used to be that was the first step of a trip to the ER.

Okay. All right. That's helpful. Just wanted to continue along the discussion of safety. I know in the oral allergen challenge study, there were a few cases of palpitations. And again, this is epinephrine. So I'm taking that with a grain of salt. But I guess the question is how clinically relevant is this?

Right. Well, what was observed were mild-to-moderate palpitations, meaning they weren't sustained. They were transient, they resolved on their own. It's very, very common because of the receptor effects of epinephrine to see these kind of chronotropic effects. In fact, these palpitations are listed in all of the epinephrine -- labeling of all the epinephrine products. So not surprising, not concerning. They only become concerning if you see longer stretches of them occurring in a row with EKG patterns suggestive of abnormal morphology, in which case those need to be managed. The good news is we didn't see any of those runs of palpitations in our program.

Okay. So I wanted to just kind of level set overall safety, BP, heart rate, et cetera, how that compares to EpiPen and also the intranasal competitor. I mean we have, obviously, at least relative to the injectables, we have the pivotal data, we have the oral allergen challenge data. It looks like you're getting really pretty high therapeutic concentrations, which you talked about as being desirable. I mean the drug is doing what it's supposed to be doing. But in terms of just safety and the implications of that Cmax, how do you compare and contrast Anaphylm versus the intranasal product that's available and also the gold standard EpiPen?

Yes. Well, I think one of the things that we have seen in terms of consistency is the maximum concentration from Anaphylm of epinephrine is very consistent in about the 12-minute time frame after administration. Whereas with the other epinephrines, there's a more lack of consistency with a broader spread, if you will, in individual patients having earlier or much later maximum concentration. So there's a predictability about Anaphylm's pattern in that it elevates quickly in most of the patients, which is, again, a desirable effect.

It also, because of that early elevation, could help the patient determine whether they're getting enough of an effect from the first dose and whether or not they actually do need to have a second dose and not administer a second dose unnecessarily. Whereas if they have a lot of variability with the other products, some that might be more delayed in their maximum concentration, they won't be able to judge that early on, and they may administer a second dose that they didn't really need. So we think that this PK, pharmacodynamic, pattern is actually quite favorable for the condition it's treating.

As far as the information about Neffy, I think the best thing to say is that they have their own literature that they published and presented, or are presenting, and it's probably best to review that literature and posters at this meeting down in Florida and make your own determination about whether you think the pattern that is displayed there is favorable or not.

I wanted to switch gears a little bit and ask about oral swelling, swelling of the tongue, swelling of mouth in the context of a severe allergic reaction/anaphylaxis. And how could that get in the way of effective administration of Anaphylm?

Right. Well, oral swelling or swelling in the mouth can occur not in all patients with anaphylaxis, but in a minority, it's called angioedema. I mentioned that earlier. What we did see, when we intentionally induced oral swelling in the OASIS study, about 25% of the patients had swelling of the tongue and cheek and throat. However, the swelling resolved very rapidly. It was within 5 minutes on average. So whatever is being manifested from the underlying disease, it's being rapidly mitigated by the presence of the epinephrine in the oral cavity.

In our other studies, our human factor studies, no patients had any difficulty -- no caregivers or patients had any difficulty administering Anaphylm under a variety of different conditions. And patients were able to self-administer Anaphylm on their own and achieve comparable blood levels to that, that was seen with it after administration by a health care provider. So we feel like this collection of data supports ease of use, no difficulties with administration, and is very supportive of the viability of this as a drug patients can carry with them and administer themselves without a problem.

So in terms of clinical -- sorry, in terms of resolution of clinical symptoms in the oral allergen challenge study, I think you cited median symptom resolution of about 5 minutes. I wanted to get your thoughts on how that compares to currently available modalities.

Right. Well, we didn't do a side-by-side comparison in this program. We can say with what we saw that the symptom resolution occurred very rapidly. And if this was a manifestation of anaphylaxis, the time to resolution of most of the symptoms along with the time to maximum concentration are about the same interval. And therefore, people are going to be able to determine whether they got a benefit or they need further care within a very short time frame, particularly since they don't have to face some of the difficulties that they might otherwise face with having to -- if they didn't remember to bring their other products with them, they don't have them on their person, if they're reluctant to administer them because there's a needle, these are all time benefits and therapeutic benefits that Anaphylm affords because it's so easy to have on you and carry with you and administer.

So we know what our study shows. It looks like it responds very rapidly. We're encouraged by that. Not really aware of similar studies being done in the literature. I'd have to get back to you on that. But we think that this is a very attractive profile given the manifestations of anaphylaxis in the oral cavity.

Okay. So regarding the pediatric data that's going to be presented on November 9, can you contextualize the pediatric PK/PD profile relative to what you saw for Anaphylm in your adult studies?

Sure. Well, the study you mentioned is being presented here at the meeting, and it will basically look at the over 30 kilogram or 17-year-old pediatric population, and the intent was to look at the pharmacokinetic curve and the pharmacodynamic profile in pediatric patients who, as you know the audience knows, are more prone to allergic reactions like this. We will be showing that it indeed does provide a robust pharmacokinetic and pharmacodynamic response. And when we compare that data to the data that we generated in adults in our pivotal study, the curves are virtually overlapping, which gives us confidence again that this product is going to be a very viable alternative for the pediatric population as well.

We have one question that someone on the line sent to me. And going back to oral swelling, I guess do you have enough exposure? I think there's 2 oral swells and 2 tongue swells. Is that enough, so to speak, for the FDA to get comfortable here?

Well, these are small studies. As you imagine, recruiting patients to expose them to an oral allergen is maybe not everybody's favorite experience. All we can do is look at the proportion of the data set that we had in the 30-some-odd patients that were in the study. But we did not see -- the 25% of them who did experience those oral manifestations, the resolution of them was so rapid that we don't think that, that's going to be any different if we had a much larger population, because basically you're administering epinephrine right on to the location where the oral swelling is occurring. So there probably is -- I'm speculating here, there probably is some local effect directly on the edematous area in the mouth. So that area probably would be the fastest and most responsive to sublingual administration.

Sure. I wanted to switch gears and talk about repeat dosing. Just help us better understand the body of repeat dosing data here. And specifically, I'm interested in how to think about the need for repeat dosing in clinical practice and how that compare with the extent to which we see repeat dosing for the currently available rescue modalities.

Right. Good question. So I think it's important -- a couple of things. One is, the repeat dosing study that was done basically gave a second dose to everybody. That's actually very different than what would happen in the real-world setting when the literature suggests that only about 10% to 20% of subjects would continue to have symptoms that were not sufficiently controlled and therefore, would want and need to take a second dose. So essentially, you -- this is what we would call a forced titration study. And so you're not -- it's unlikely we would see elevations in the PK levels that we saw in this study because it's not how it would be administered in the real-world setting.

The effect of the second dose, the adverse event profile, the durability and the pharmacodynamic effects are all within a safe range based on existing clinical parameters. So we're not concerned, and we're not seeing severe adverse reactions as a result of the second dose. To be honest with you, probably the people who need a second dose would be the people who did not have a robust response to the first dose. And so their levels are going to tend to be lower than some of the values that might occur in a forced titration study.

Okay. So let's move on to commercialization or commercial readiness. So my next set of questions are for Sherry. And I'll start with a question about the sales force. Can you just remind us how you're thinking about sales force headcount, the headcount for other personnel such as MSLs, and how many prescribers you intend to call on initially?

Sure. Thanks so much. As you have probably heard me say in the past, the epinephrine market is one that is an inch deep and about 10,000 miles wide. Why is that? Well, the prescribers range from primary care physicians who write 1 or 2 prescriptions, refills annually, to the allergists who prescribe more than 200 prescriptions per year. Because allergists are so productive and because the pediatricians and the PCPs look to see what the specialists, i.e., the allergist prescribes, our initial focus will be in that allergy space. That will be about 5,000 clinicians, and our sales force will be sized to call on that prescriber base. So you can be thinking that we'll launch with a sales force in the range of 50 to 60 reps and managers. Again, that will allow us to have not only the depth of coverage of the allergists, but also be able to reach them frequently.

We are in the process of hiring our sales managers, and we will hire our specialty sales representatives upon approval. And so we have been really building our commercial team, making sure that we have individuals with significant launch experience with allergy experience as we bring them into the commercial organization. As it relates to others, a medical team, as I'm sure you can imagine, is critically important. And as we think about MSLs, we have recently brought on 2 more MSLs, and we will look to increase by a few more early next year.

So the next question I have is on pricing. And I know you get this a lot, and probably not a ton you could say, but I'd ask it anyway.

Yes, of course. I wouldn't expect anything less.

So yes, I mean, I guess the way to ask it is just in general, how are you thinking about it? I mean, obviously, this is an innovative product, but with the reality that EpiPen has a generic and there's generic pricing here. And we all know what Neffy is priced at. So as you think about these dynamics in broad strokes, I guess, how do you think about pricing?

Yes, it's a good question. And we haven't disclosed our WAC price. We won't do that until we're ready to launch. And as you also said, we believe there is significant value in our innovation. However, we do also believe in a patient-first approach to pricing, and we must price responsibly. So with that being said, if you think about the branded market, Auvi-Q, branded EpiPen and Neffy, the market has pretty much been set by the currently available epinephrine products. And so we understand the challenges patients have for access. And so we'll be -- what we're exploring and we're just completing some additional pricing and payer research as we speak, we'll look to see what the payers are telling us and think about it in that range of the branded epinephrine products.

Now obviously, we are committed to patient access, and we want to ensure broad access. So that is everything from a cash pay, a cash price, co-pay savings programs, ensuring that we get the broadest coverage for Anaphylm over time, setting up a support hub for doctors and patients. And so we'll have a broad range of options available for patients and caregivers to take advantage and accessing Anaphylm.

So what kind of learnings are you using from the rollout of Neffy that could inform both your promotional strategy and also your payer strategy?

It's a really good question. I think it's the #1 question of the day. So look, I think it's always important. When you're in a second -- in position #2, you kind of have that fast follower advantage to look at what has the brand right in front of you done well, where were there some gaps and hiccups, and how do you make it better? So we get to see in front of us what they went through. So we are constantly systematically assessing and gathering insights from the recent launch.

So I think, first and foremost, payers. Our market access and clinical team has been actively engaging with payers. We're conducting payer research, understanding what went well with Neffy, what maybe didn't go so well. And we're confident that we're going to achieve broad coverage over time. But it takes time. And just as you've seen with ARS, it's going to take time. But we do believe, over a period of time, we'll be competitive with the other branded products in the space.

I think some other things that if you think about it from a promotional perspective, as we look at the size of the sales force, it will be quite different. And why is that? We have a differentiated product, and we're taking a differentiated focused approach towards our launch. And part of that is being very disciplined in how we roll out the product. So again, coming back to we're going to call on the most productive physicians with a sales force that is rightsized for those specialists.

Over time, we'll give ourselves the opportunity to scale. As market access comes on, we will scale as we are selling more, as more physicians and consumers are aware, we will be able to scale. So I always say it's easier to scale than it is to go the other way. And so we're making a very conscious choice to start small and build as opposed to what the competitors did is to go out really big and then have to manage through that.

So I think you'll see another difference in our marketing tactics and our go-to-market plan is it will be, again, very focused versus broad brushed and trying to hit everyone. In all the years I've been doing this, in relaunching EpiPen, having all the learnings from growing a brand, a 30-year-old brand at the time from a few hundred million to over $1 billion is that there is time and place for everything. And so in a situation where you're launching a new drug, it's not a device, and it is clearly differentiated from an efficacy, ease of use, ease of carry perspective, we've got to make sure that doctors know about the product, right? And we're getting that market access, and then we are engaging with the consumers.

This is a highly driven consumer market. But again, time and place for everything. I think it would be inappropriate for us to think about a big TV campaign in year 1. So those are just some general thoughts as we think about what we've learned from the Neffy launch and what we will be doing similarly as well as differently.

So you mentioned DTC. I think you've answered the part of my question of what your approach will be early in the launch. But I wanted to get your thoughts on what your approach to DTC will be longer term. There is a place for it. We know that. But I would imagine you're not going to see Anaphylm commercials play sort of all over the airwaves like you see for mass market products that you see during sporting events and TV shows. But there is a place for DTC in the setting. So how do you think about Anaphylm DTC longer term?

Yes. Look, Anaphylm is a consumer-driven product. We absolutely believe in the value of consumer awareness and education for Anaphylm. We will launch with consumer materials. DTC is -- everybody, when you say DTC, I think we all think of TV ads, but it's much broader than that, right? It's digital nonpersonal promotion. It is journal ads for the physician, it is magazine ads for the consumer. And look, there's a lot of really cool things that are going on out there in the market that is not as expensive as running TV.

With that being said, our prelaunch awareness campaign is really focused on the HCP with CME, non-CME pubs, congresses. And then as we think about launching, we will be driving that message to caregivers, the moms that are the Chief Medical Officers, because, again, it is a consumer-driven market. I think what you can expect to see is digital, nonpersonal promotion, office promotion for patient awareness, but the TV, obviously, we'll wait. We'll look at all of the options as we're doing our planning for 2027 in TV, connected, et cetera. But again, that will scale with time.

Okay. So let's move on to sales force expansion beyond the initial rollout and presumably, there will be a time and a place for that. But will your headcount expansion be sort of informed by success. In other words, success begets expansion, expansion begets more success and so on and so forth. Is that the way you think about it?

Yes. I think it's like an avalanche. You start to get -- our initial focus is going to be in that allergist space. The sales force will be sized to call on that prescriber base. Over time, as adoption grows and payer access increases, we will look to scale. And so the allergists are so excited, as Dan mentioned on the call this morning, I mean, the feelings are really palpable. When I was here yesterday and this morning walking around, I mean, people are really, really -- doctors are very excited about Anaphylm. And so, again, as we go, we will scale.

There are payer restrictions and certain states have a lot of challenges from a payer and a physician access perspective. And so we -- again, I feel very strongly about our choice, and it's a very disciplined choice to start with that allergist, get the specialists writing. The specialists, the pediatricians, they're very, very slow to adopt, for obvious reasons, and that's of any product, but layering in the pediatricians, ENTs and the large primary care physicians over time. So yes, you can expect to see that over time with sales performance and market access.

Great. So I wanted to move on to Anaphylm supply chain readiness. So next set of questions are for Cassie. So just talk generally about the building out of commercial supply.

Yes. So thanks for that question. I mean, look, this is an area of great experience for us, right? In our over 2 decades of existence, right, more than half of those have been focused on manufacturing, right? And I think as you heard Dan talk about this morning in the earnings call, this year alone, we'll do 150 million doses. So we put out over 2 billion doses of Anaphylm product around the world, right? So we're well situated when it comes to the manufacturing and building supply and have experience in launches, right?

And again, as you heard Dan talk about earlier this year -- this morning, we've done a lot of work in establishing critical vendors that are part of the process that are all U.S.-based. We've got long-standing relationships with them. So I think when you put that together along with our experience, we feel really well positioned around the commercial supply.

Okay. And then in terms of prescription fulfillment, can you talk about the extent to which you'll lean on specialty pharmacies? Or will most prescriptions just get filled by retail pharmacies? How should we think about that?

Yes. I think that's probably one that Sherry will talk a little bit about.

I'm sorry, David, can you repeat that?

Yes. Just to the extent to which you will lean on specialty pharmacies or prescriptions just be filled by good old-fashioned retail channels.

Yes. So this market is -- I mean, it is predominantly retail, right, the corner of health and happiness. However, as we have learned from looking at many other products that are written in the allergists' office, having a specialty pharmacy channel is important. And so we will look to -- we are planning to have a specialty pharmacy and that will be aligned with our hub.

Okay. So in the next few minutes we have left, I just want to go through financial update. So first, Ernie, with the raise recently, just talk through your cash runway.

So we feel we're in a very good place as a company as far as the capital structure now. In the third quarter, we did 2 major financings. First, we did an $85 million equity raise, which was led by RTW and brought in a group of high-quality health care investors into the company that we've never had before. Concurrently with that, we did, with RTW, a revenue interest financing on Anaphylm that brings another $75 million into the company, subject to 2 conditions it's based on, one, approval of Anaphylm and two, that we refinanced our existing debt.

And as I also mentioned in my script this morning, we are out trying to refinance the debt. We've found the market to be just very receptive to our financing right now. And we hope that in the near future, we will be able to announce a refinancing of our existing debt with, again, another high-quality institutional health care lender that people will recognize. So you take all 3 of them together and maybe some additional capacity under our debt, it provides us runway through '27. It gets us through this year of all the pre-commercial work that Sherry is doing next year; if approved, the ramp-up of the sales force and all of the spend that we've talked about. And again, based -- really depends on the uptake and also level of spend, but it definitely extends the runway through 2027.

It does not take into account any licensing, for example, European licensing of Anaphylm, which we could possibly do, we've talked about. That runway doesn't include any other financings that we possibly could do, again, based on market conditions, uptake. There's a whole lot of factors there. So we really feel good about where the company is today from a capital structure. We get this debt financing done. That will be the third leg for this year, and then we're off to the races.

Obviously, you're nicely funded for the launch. So can you talk about initial launch spend and how we should think about next year and the spend and really the ramp in spend on Anaphylm commercial support as the product launches?

So we haven't given any guidance for 2026 yet. But if we think about what we have said publicly on the commercial spend and what Sherry said, we're not hiring one sales rep until we have approval. We get approval, the offers will spring forward. We would expect within 30 days to have that sales force on. So end of first quarter, the sales force is on, that's when we will begin to see the impact of that spend. So I think we then would see in the second -- and the number of reps would be, as we said, 50 to 60 reps.

In the second and third quarter, you would probably see additional commercial spending as the allergy season ramps up, that's prime season, and that's when we would see a higher spend there. So I think we'll see it ramp up definitely end of first quarter through second and third quarter, and then maybe a little bit lower as we get to the year, end of the year. But we feel that we're well prepared for a successful launch if approved by the FDA.

What about the longer-term commercial support of Anaphylm in terms of spend? I mean, at some point, there will be operating leverage. I mean -- and obviously, that's going to depend on kind of what kind of sales ramp you have, of course. But just thinking about the commercial model, how are you thinking about growth in spend longer term and the extent to how quickly you can start to really see operating leverage?

I think as we go out, we -- 2026 is the build and launch year, 2027, again, depending on the ramp and the uptake, you would see expansion. And I think as we get later into 2027, early 2028 is when you would begin to see the leverage. And maybe -- again, I don't want this to be considered any type of guidance, but maybe mid-2028, you would begin to see that leverage come to fruition.

Okay. So there's sort of, well, a couple of broader questions outside of Anaphylm. I mean when you have Libervant, it's there. And that's a nice product category. But is that an asset you're looking to monetize?

I think with Libervant, we've always said it's a very good product. Overriding everything is to make sure it gets into patients' hands. So people who need the product. And as we've always said, we evaluate if it's best in someone else's hands and somebody comes to us with a compelling offer, we would definitely be interested in talking to them. But look, next year, our primary focus is the successful launch of Anaphylm, if approved. And trying to divert attention to preparing to commercialize Libervant might be a stretch for the company, but we got to see where we're at.

And a broader question regarding balancing, reaching sustainable profitability, but also moving forward with other programs. You have your epinephrine prodrug platform. I think you talked this morning about your alopecia areata program. So that's certainly going to move forward. But you've talked to other potential programs where you can leverage your epinephrine prodrug platform. So I guess, how do you balance the goal of reaching sustainable profitability with these R&D goals where you can leverage this technology?

It is a balancing act of -- we're trying to do a lot here with commercializing Anaphylm and also, again, investing in the future, the future of the company with our AdrenaVerse platform and in particularly 108. So it's something we are constantly looking at. We're fortunate, as we've done these capital transactions, to now have a more available cash to invest. But still, we need to make sure that we're balancing all the resources in the company, not just cash, to be able to focus on the commercial efforts, the research and development efforts and the manufacturing efforts. So hopefully, as we move forward into '26, we'll be able to address all those issues.

And then last question. I think you touched on it, Ernie, on ex U.S. But just high level, just other geographies where you're thinking about partnering out. Obviously, there's Canada, there's Europe, there could be other geographies. But where do things stand in terms of ex U.S. and how you're thinking about that for Anaphylm?

For Anaphylm, I think probably the first priority would most likely be Europe. We've seen the transaction that the nasal spray did for Europe. It was a very good deal. And I think it's something we continue to think about and explore. And I think time will tell on where that goes and if there are other territories that would either come first or right after a deal like that.

Okay. Well, we are at the top of the hour here. So I will leave it there, but I really appreciate what was an expansive discussion, and my thanks to the team here for taking the time. And we certainly will look forward to the presentations at ACAAI. And so we'll leave it there. But thanks, Aquestive team, and thanks, everyone, listening in, and hope you all have a great rest of the day.

Thanks, David. Appreciate the opportunity to spend time with you today.

All right. Thank you.

Good day, and thank you for standing by. Welcome to the Q3 2025 Aquestive Therapeutics, Inc. earnings conference call. [Operator Instructions] Please be advised that today's conference is being recorded.

I would now like to hand the conference over to your speaker today, Brian Korb. Please go ahead, sir.

Thank you, operator. Good morning, and welcome to today's call. On today's call, I'm joined by Dan Barber, Chief Executive Officer; and Ernie Toth, Chief Financial Officer, who are going to provide an overview of the company's recent business developments and performance for the third quarter of 2025, followed by a Q&A session. During the Q&A session, the team will be joined by Dr. Gary Slatko, Interim Chief Medical Officer; Sherry Korczynski, Chief Commercial Officer; Lori Braender, Chief Legal Officer; and Peter Boyd, Chief People Officer.

As a reminder, the company's remarks today correspond with the earnings release that was issued after market close yesterday. In addition, a recording of today's call will be made available on Aquest's website within the Investors section shortly following the conclusion of this. Call. .

To remind you, the Aquestive team will be discussing some non-GAAP financial measures this morning as part of its review of third quarter 2025 results. A description of these measures, along with a reconciliation to GAAP, can be found in the earnings release issued yesterday, which is posted on the Investors section of Aquestive website.

During the call, the company will be making forward-looking statements. We remind you of the company's safe harbor language as outlined in yesterday's earnings release as well as the risks and uncertainties affecting the company as described in the Risk Factors section and other sections included in the company's annual report on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K filed with the U.S. Securities and Exchange Commission.

As with any pharmaceutical company with product candidates under development and products being commercialized, there are significant risks and uncertainties with respect to the company's business and the development, regulatory approval and commercialization of its products and other matters related to its operations. Given these uncertainties, you should not place undue reliance on these forward-looking statements, which speak only as of the date made.

Actual results may differ materially from these statements. All forward-looking statements attributable to Aquestive or any person acting on its behalf are expressly qualified in their entirety by this cautionary statement and the cautionary statements contained in the earnings release issued yesterday. The company assumes no obligation to update its forward-looking statements after the date of this conference call, whether as a result of new information, future events or otherwise, except as required under applicable law.

Now I would like to turn the call over to Dan.

Thanks, Brian. Good morning, everyone, and thank you for joining us today. This morning, we are holding our earnings call from the American College of Asthma, Allergy and Immunology Annual Conference here in Orlando, Florida. This is one of the largest allergy-focused conferences in the U.S., and we are proud to be here supporting the college at their annual gathering. We have almost 20 colleagues on site this week and a host of events, including multiple poster presentations, a fully staffed medical affairs booth on the exhibition floor and multiple engagements with investigators. This truly is an exciting week for the Aquestive team.

This is also emblematic of the increased awareness of our Anaphylm dibutepinephrine sublingual film program within the allergy community. In fact, our latest data suggests most allergists are now aware of our sublingual film program and over 25% have even completed our continuous medical education, or CME presentation offered through Medscape, the leading provider of CME materials for physicians.

As we approach our FDA scheduled action date of January 31 for Anaphylm, we are well positioned from an allergist awareness perspective. In case anyone hasn't been paying attention, Anaphylm, if approved by the FDA, will be the first and only oral medication for the treatment of severe allergic reactions including anaphylaxis. Today, health care providers, caregivers and patients must choose between two types of medical devices: auto-injectors and nasal sprays. We believe our portability, low barrier to use and fast absorption profile creates a transformational offering for the allergy community.

Following our equity raise and strategic financing agreement that we announced this past August, our prelaunch activities have accelerated and remain on track for a first quarter 2026 launch if Anaphylm receives FDA approval. Our marketing materials are ready to go and are only awaiting a final label. We are in the process of hiring our district managers and will hire sales reps upon FDA approval.

Our market access team is in full swing and interacting with payers under acceptable preapproval guidelines. Our supply chain is prepared to rapidly produce material once final labeling has been provided by the FDA. And importantly, our medical affairs team is fully deployed, as you heard from my opening statements, regarding this week conference. Simply put, we are ready to go.

Now let's turn to the FDA. Given the government shutdown, we requested the FDA to provide us with a status update on the review timing of our filings. I am pleased to say that as of this last update, the FDA confirmed they are aiming for an on-time review of our application. As we reported to you in September, the FDA has informed us that we will not have an Advisory Committee meeting. However, we remain ready to provide further information if necessary to the FDA reviewers. We will keep everyone appropriately updated as we learn more and as we get closer to our action date.

As we begin looking towards 2026, there are two very important priorities in our business: one, putting together the best possible launch of Anaphylm; and two, [ bring ] the science behind our AdrenaVerse platform. If you recall, we made the strategic choice to slow down our AdrenaVerse pipeline initiatives in the first half of 2025 and while we work on fully funding our launch. Now it is time to get going.

To better accomplish these goals, I announced several leadership changes earlier this week. First, to better support Anaphylm, I've asked Dr. Gary Slatko to become our interim Chief Medical Officer. Gary has the perfect blend of medical affairs expertise and deep understanding of our Anaphylm development program. Some of you may recall, Gary was previously our Chief Medical Officer from 2018 to 2023. I have also promoted Peter Boyd to Chief People Officer. This is a critical role as we expand our organization to include a full commercial team.

On the AdrenaVerse side, I am very excited to announce the addition of Dr. Matthew Davis as our Chief Development Officer. Matthew and his team will be very focused in 2026 on kick-starting our R&D efforts and driving clinical proof points that show the value our AdrenaVerse platform can create. While Anaphylm is transformational to the allergy community and to Aquestive, it is just the beginning of our story. Through the efforts of Matthew and his team, I am confident there are multiple significant programs yet to come.

The first of these programs is our AQST-108 development program for the treatment of alopecia areata. We have completed the pre-IND meeting process with the FDA and we'll be submitting our IND shortly. We expect to be in the clinic with our next study, a safety study in men starting in January, and expect this study to complete rapidly. With the funding just received by the company, we will look to advance our progress on this front.

Our international efforts for Anaphylm as well continue to gather steam. We had a positive interaction with Health Canada in the third quarter and are excited to share that no further studies are required for filing our application. We anticipate filing in Canada in the first half of 2026. We have also continued our interactions with the European Medicines Agency, or EMA, and expect to have full feedback regarding the application process by early in the first quarter of 2026. We will continue to advance our regulatory interactions as we work towards the appropriate partnerships in these territories.

Our base business continues to be an important provider of cash flow and capabilities and we expect this to continue in 2026. We continue to see stable demand from Indivior, our largest base customer. We have also seen significant growth in our South American partnership focused on the Brazilian market. Our manufacturing team is prepared to take a leading role in supply of Anaphylm to our commercial team and eventually around the world.

Finally, from a financing perspective, we are now well positioned to fully fund our business through the commercial launch of Anaphylm, if approved by the FDA. As Ernie will discuss with you in a moment, one of the last pieces to the puzzle in locking in our finances is refinancing our existing debt. We are well on our way with this effort. And as of today, I expect this to close before the end of the year.

So to summarize, as we look forward, you should expect the following. We will be ready to launch in the first quarter if Anaphylm is approved on time by the FDA. We will begin to make rapid progress on our broader AdrenaVerse platform and advance our pipeline. We will continue to actively progress our regulatory applications for Anaphylm outside the U.S. And our base business along with our financing from August have us financially well positioned for 2026 and beyond.

Now I will turn the call over to Ernie.

Thank you, Dan, and good morning, everyone. By now, you have seen our financial results in our earnings release that was issued last evening. As we typically do, we will address most of the discussion related to the third quarter 2025 results into Q&A.

During the third quarter, we continued to execute on our strategy to support the continued development of Anaphylm, our lead epinephrine product candidate that has no needle is, not a device, is orally administered and is easy to carry. This includes the completion of the pediatric trial and supporting pre-approval launch activities for Anaphylm to increase awareness among physicians, payers and the advocacy community as we approach the PDUFA action date scheduled for January 31, 2026.

To support the Anaphylm launch, we completed two financings during the third quarter. First, we completed an equity raise for $85 million, led by RTW Investments and included participation from Samsara BioCapital, EcoR1 Capital, Perceptive Advisors, Sio Bio Capital Management, ADAR1 Capital Management and Nantahala Capital.

Secondly, we completed a commercial launch financing of $75 million with RTW Investments that is subject to FDA approval of an and satisfaction of certain refinancing and other customary conditions related to the company's existing debt. Under the terms of the agreement, RTW will receive a tiered single-digit percentage of annual net sales of Anaphylm in the U.S. for the treatment of type 1 allergic reactions including anaphylaxis, subject to a stated cap.

These two financings provide critical capital that will support the company through 2027, enabling us to successfully bring Anaphylm to market if approved by the FDA and delivering a new treatment option for patients in need. As required by the commercial launch financing, we are pursuing a refinancing of our existing debt. We have found the debt capital markets to be robust for our financing and hope to be in a position to announce a new debt partner in the near future.

Aquestive's manufacturing business remains steady with a gradual decline of our licensee products, Suboxone, which accounts for the substantial part of our current operating revenue, being offset by growth across newer collaborations, including for the licensed products Ondif and Sympazan. In addition, the company being a U.S.-based manufacturer with intellectual property domiciled in the U.S. has a supply chain, which currently remains largely unaffected by both implemented and proposed tariffs, providing continued reliability and stability in production and global distribution for the near term.

Now let's turn to the third quarter results. Excluding the impact of onetime recognition of deferred revenue in the third quarter of 2024, total revenues increased by $0.5 million or 4% year-over-year to $12.8 million in the third quarter of 2025. As a reminder, the onetime recognition of deferred revenue in the prior year was due to the termination of a licensing and supply agreement. Including the deferred revenue recognized in the prior year, total revenues decreased to $12.8 million in the third quarter 2025 from $13.5 million in the third quarter of 2024. Manufacturer and supply revenue increased to $11.5 million in the third quarter of 2025 from $10.7 million in the third quarter 2024, primarily due to increases in Sympazan and Suboxone revenues.

Total revenues decreased to $31.5 million for the 9 months ended September 30, 2025 from $45.7 million for the 9 months ended September 30, 2024 due to onetime recognition of deferred revenue in the prior year. Excluding this onetime recognition of deferred revenue, total revenues decreased by $2.6 million or 8% year-over-year. Manufacturer and supply revenue decreased to $28.2 million for the 9 months ended September 30, 2025 from $29.3 million for the 9 months ended September 30, 2024,,, primarily due to decreases in Suboxone revenues, partially offset by increases in Ondif revenues.

Research and development expenses decreased to $4.5 million in the third quarter of 2025 from $5.3 million in the third quarter of 2024. The decrease in research and development expenses was primarily due to lower clinical trial costs associated with the Anaphylm program, partially offset by increases in share-based compensation.

Research and development expenses decreased to $14 million for the 9 months ended September 30, 2025 from $15.4 million for the 9 months ended September 30, 2024. The decrease in research and development expenses was primarily due to a decrease in clinical trial costs associated with the Anaphylm program, partially offset by increases in share-based compensation, increases in product research expenses and increases in personnel costs.

Selling, general and administrative expenses increased to $15.3 million in the third quarter of 2025 and from $12.1 million in the third quarter of 2024. The increase primarily represents higher pre-commercial spending of approximately $1.8 million, higher legal fees of approximately $1 million, higher regulatory expenses related to Anaphylm of approximately $0.6 million, higher personnel costs of approximately $0.2 million, higher share-based compensation expenses of approximately $0.2 million, partially offset by lower regulatory and licensing fees of $0.5 million and lower consulting fees of approximately $0.2 million.

Selling, general and administrative expenses increased to $47 million for the 9 months ended September 30, 2025 from $34.2 million for the 9 months ended September 30, 2024. The increase primarily represents higher commercial spending on prelaunch activities for Anaphylm of approximately $6 million, higher regulatory fees related to the Anaphylm PDUFA fee of approximately $4.3 million, higher personnel costs of approximately $1.1 million, higher regulatory expenses related to Anaphylm of approximately $1 million, higher share-based compensation expenses of approximately $0.7 million, higher legal fees of approximately $0.6 million and higher regulatory and licensing fees of approximately $0.6 million, partially offset by decreases in severance costs of approximately $1.1 million and lower insurance expenses of approximately $0.6 million.

Aquestive's net loss for the third quarter of 2025 was $15.4 million or $0.14 for both basic and diluted loss per share compared to the net loss in the third quarter of 2024 of $11.5 million or $0.13 for both basic and diluted loss per share. Excluding the impact of onetime recognition of deferred revenue, the net loss in the third quarter 2024 was $12.7 million.

Aquestive's net loss for the 9 months ended September 30, 2025 was $51.9 million or $0.51 for both basic and diluted loss per share compared to the net loss for the 9 months ended September 30, 2024 of $27.1 million or $0.32 for both basic and diluted loss per share. Excluding the impact of onetime recognition of deferred revenue, the net loss for the 9 months ended September 30, 2024 was $38.6 million.

Non-GAAP adjusted EBITDA loss was $8.6 million in the third quarter of 2025 compared to non-GAAP adjusted EBITDA loss of $6.6 million in the third quarter of 2024. Excluding the impact of onetime recognition of deferred revenue, non-GAAP adjusted EBITDA in the third quarter 2024 was a loss of $7.8 million.

Non-GAAP adjusted EBITDA loss was $35.5 million for the 9 months ended September 30, 2025 compared to non-GAAP adjusted EBITDA loss of $11.9 million for the 9 months ended September 30, 2024. Excluding the impact of onetime recognition of deferred revenue, non-GAAP adjusted EBITDA for the 9 months ended September 30, 2024 was a loss of $23.4 million.

Cash and cash equivalents were $129.1 million as of September 30, 2025. Aquestive's full year 2025 financial guidance remains unchanged. The company expects total revenue of $44 million to $50 million and non-GAAP adjusted EBITDA loss of $47 million to $51 million. As a reminder, our revenue guidance for 2025 no longer includes revenue for Libervant for ARS patients aged between 2 and 5 years, and our 2024 revenue included onetime nonrecurring recognition of deferred revenue related to termination of certain licensing and supply agreements.

Our non-GAAP adjusted EBITDA loss guidance for 2025 include significant preapproval launch spending for Anaphylm, costs associated with the submission of the Anaphylm NDA and related filing fee, completion of the Anaphylm pediatric clinical trial and costs associated with the preparation for the potential Advisory Committee meeting that is no longer required by the FDA for approval of Anaphylm.

With that, I will now turn the line back to the operator to open the line for questions.

[Operator Instructions] Our first question will come from the line of David Amsellem with Piper Sandler.

Just a couple for me. First, any new comments on your competitors' citizens petition and how that may or may not impact the timing of the FDA decision? And also, have you responded to the citizens petition? Just kind of latest thoughts there.

And then secondly, I wanted to ask you about pricing and access just given whatever learnings you might have had from the experience of your competitor in its launch. How are you thinking about pricing relative to the nasal spray and the generic EpiPen? And also how does that play into your strategy on access?

David, so let me start in more general place and then I will come to your specific question. We're sitting here today with the team here in Orlando, Florida, the college, the ACAAI conference. What's exciting is everything is coming together. So if you look at the pieces and the parts of what we're trying to accomplish, what you're seeing today is how they're starting to intertwine. So the FDA review is in good shape. We'll talk about that in a minute with your comment.

Our financing is in place. The market grew by almost 9% last quarter. We've expanded our patent coverage. We're bringing in the right team. And our prelaunch activities, as I'm sure you'll hear from Sherry throughout the Q&A, are in great shape. So we're incredibly excited with where we are right now. Now so let's turn then -- let's take that excitement and let's turn it to the CP that our competitor put into the FDA, which you asked about. So think about -- and David, I don't know if you read all 16 pages of that document. But think about what it took to create that document.

A very expensive DC-based law firm was hired. That law firm had to write the document, put it together, review it with the organization and then finalize it and send it to the FDA. And I will tell you that my belief is that was a significant amount of resources by our competitor, by the law firm and probably a big bill.

So companies only do that if there's a reason to do it. I don't think they did it because they felt a civic duty to do it. I think they did it in my personal opinion because they're worried. Because they're worried about what we're bringing to the market and what it does to them. Now why should they worry? What can I focus on to say they should be worried?

If you look in the supplemental materials that we put out, you'll see that our latest survey work, and I'm sure they're doing their own survey work, shows that when you send a mockup, a nonpromotional version of the nasal spray and the film to a person who's familiar with this space and ask them what product they would prefer, in our survey, which was 35 individuals, 33 of them said they would prefer the film. One of them said they would prefer the nasal spray and one said that they were indifferent to whether it was the nasal spray or the film. So when I look at that and I look at why that CP was put in, that makes sense to me.

Now in terms of the content of the CP, we have taken the time -- it was definitely a kitchen sink approach so we have taken the time to unwind all of it and look at it. And in terms of our review of what they have put forward, it is factually incorrect in a variety of places and misinformed. We think that hurts the credibility with the FDA. And from our perspective, we've seen zero impact to our review and expect zero impact.

So now let me turn to your second question, which was on pricing and access, and I'll hand that over to Sherry.

David, thank you for the question. While we have not disclosed our WACC price, we do believe there is significant value in our innovation. As you know, the branded epinephrine market has been set by the currently available product. So with that being said, we understand the challenges, and we plan to price responsibly with a patient-first approach to our pricing. We have and we're continuing to explore a lot of options to ensure that there is broad access, which includes cash pay, co-pay savings program.

And we're actively working with the payers for coverage. So we do plan to have a range of options for patients to be able to access Anaphylm. But as you know, the path to a patient having an Anaphylm or any product in hand takes a lot of work. And so access and patient support is critical. We have been spending our time and our resources with payers engaging in preapproval information exchange with our clinical team and the clinical teams of payers. We have what we believe is a very strong value prop and our strategy is beneficial to patients. So we will continue to -- we'll come back to you at the right time with what will set pricing. But I think that you can certainly look around us to get an idea.

Our next question comes from the line of Kristen Kluska with Cantor Fitzgerald.

This is Rick Miller on for Kristen. We'll have one here and then a follow-up on potential partnerships ex U.S., you're moving forward with these regulatory interactions. So how do you think about the optimal timing from a value perspective as to when to partner out ex U.S.? And maybe give a sense of what those potential partner conversations have been like at this stage? And then we'll have another follow-up.

Sure. So obviously, we see Anaphylm as being a global product. We think it can be broadly distributed across a variety of markets. And so we've started that work now to go into the major markets outside the U.S. Clearly, EMA, Canada the U.K., Japan, those are the key places from a value perspective, but obviously, even broader across the world, the need is real. In terms of -- and we have also publicly stated, just to remind everyone, that we're not interested in having an international footprint of our own so we will license outside of the U.S.

In terms of when the right time is to partner, those conversations are always ongoing. Clearly, the closer you are to an approval, the more valuable the product and the partnership can be. So from my perspective, we need to get farther along with our regulatory interactions. In Canada, we'll have a filing, we believe, in the first half. In Europe, we'll know shortly if there's any work to do in addition to what we've done to be prepared for our filing and then we'll move on to a filing. So I think as we move towards those steps, that's a good inflection point for the conversations that are already active to get to something that is meaningful and real for the organization.

And maybe then you mentioned being at the conference right now. What are some of the takeaways you're hearing around the conference, especially around your medical affairs booth as it relates to excitement for new potential additional needless epinephrine options?

Sure, sure. Well, I have to say that the main part of the conference is ahead of us. So the medical booth and the exhibition hall and all of those things starts tomorrow. So we're all here getting ready and excited about it tonight. We'll actually have a bunch of our investigators together to talk about our program and what they're excited about.

I will tell you that as I walk the halls with people who are getting ready for the conference here, one, the amount of comments that are around the excitement of our product coming is palpable. And two, the desire to know and learn more is real. So to me, those are two really good signs that we've hit a need that is meaningful, and we'll obviously be continuing those conversations throughout the weekend.

Our next question comes from the line of Raghuram Selvaraju with H.C. Wainwright & Co.

Firstly, with respect to the Anaphylm outlook, I was wondering if you could, a, perhaps give us a sense of how you are thinking about the parameters you anticipate sharing with the investment community as and when Anaphylm gets to the market and what specific takeaways you are planning to get from the commercial introduction, in particular with respect to factors that might educate how you position Anaphylm in the market upon launch. And also if you could comment on the MSN pricing situation and how this affects your approach to thinking about pricing in ex U.S. markets.

Yes, yes. Ram, so I'll take a few of those pieces. And in terms of the positioning in particular, I'll hand it over to Sherry in a minute. So in terms of when we plan to come to market. So our PDUFA date is January 31. Our guidance remains the same that we believe we'll be able to launch in the first quarter, so by launch, we have sales reps trained and in place and have our supply chain providing product to distributors for fulfillment of prescriptions.

In terms of -- let me actually go to the last piece first, the most favored nation pricing. We are following that closely. Right now, we don't see any impact on our ex U.S. potential partnerships and how that would affect pricing in the U.S. But obviously, we'll be keeping an eye on that. And as legislation or executive orders evolve, we'll make sure that our -- we're at the right stage where we can make sure we protect the U.S. market from any of those issues that pop up.

So in terms of positioning, before I hand it over to Sherry, just a couple of global comments from me. One, we are clearly different from the medical devices that are in the market. And I'm sure Sherry will say way better than I will why we believe that so firmly. Two, when I look at the market and what happened in Q3, and it follows Q2 and Q1, this market is growing. And it's actually growing in the auto-injector space. 95% of the scripts are auto-injectors. So that is the focus. That is the spot where the market is for us to go grab, and that's where our energy will be. But I'll let Sherry talk about how we're positioned.

Yes. Thanks so much, Ram, and thanks for the question. As we think about our launch, we are taking a differentiated, focused, patient-centric approach along with a very disciplined commercial strategy. And then that puts us on track for a highly successful launch. What we know is that patients want choice. They have not had choice for decades. And so when we speak to -- when we're doing our market research, and Dan alluded to it earlier in the call, we find that the allergy community, whether it is patients, caregivers, advocacy organizations and the HCPs, they all continue to be very positive.

And why is that? Well, patients went choice, as I said. And mothers, who are the Chief Medical Officers of the home, as you know, are telling us that because Anaphylm is the easiest to carry, it's the easiest to use and it's fast acting, that Anaphylm is a great choice. And so for the millions of people that are at risk for anaphylaxis who may have avoided epinephrine, did the device and balked in needle anxiety. The fact that Anaphylm is not a device, that form factor is so critically important. And it really removes the final barrier to people caring and having epinephrine on hand at all times.

The guidelines recommend always have two forms of epinephrine. So always carry two auto-injectors or carry two nasal devices. And so what Anaphylm does is it removes that barrier because, as you know and you've seen, it fits right in the back of your phone or in a small wallet. I think the other thing really to keep in mind that is critically important, and we continue to hear this in our market research and engagement with physicians, is Anaphylm's exceptional stability profile means that Anaphylm can perform across diverse real-world conditions.

So I think there's a lot of differentiation between, we believe, and patients, caregivers and HCPs are out telling us between an versus the devices. And we continue to -- we'll be driving that message as we launch in Q1.

Very helpful. And just very quickly on the AdrenaVerse platform. I was wondering if you could comment on what the alternative routes of administration and formulations are starting to look like beyond AQST-108, if there are other topical gels or if you're looking at deploying the AdrenaVerse platform via alternative routes of administration beyond the topical arena.

And then lastly, just very quickly for Ernie. I was wondering, if you look at the debt refinancing initiatives, what you are prioritizing most, is it the longest possible maturity date? Or is it the lowest possible coupon? Just give us a sense of what you're looking to accomplish there.

Why don't I have Ernie take the second part and then I'll address AdrenaVerse.

Ram, so what we're looking for most of all, besides the things that you talked about, we're always looking for a coupon and the lowest interest rate and the flexibility, is really finding a partner that we can grow with as the company grows and someone that we feel we can work with as we move forward to grow the company.

And we've been very fortunate as we've gone through this process. The number of lenders, potential lenders that we've spoken to that have wanted to partner with us and to meet those qualifications. So we feel we're in a good place. And as I said in my script, we hope to be able to announce that new debt partner in the very near future.

And to take the other question, Ram, which thank you. I appreciate you pointing that out. So the sky is the limit right now in terms of the types of delivery systems we use with our AdrenaVerse platform. Now that we have -- and we've created the Chief Development Officer role, and we have someone focused on our pipeline who has the depth of experience that Matthew Davis has, we'll, of course, continue the cream gel foam work that we're doing. But there are indications that could be envisioned in a variety of different routes of administration including film, capsules, potentially even if it was something that required it, injectables are available. So we're not limiting ourselves to the route of delivery. We're much more focused on as we have been with Anaphylm, what is right for the patient for the solution we're trying to bring.

Our next question comes from the line of Andreas Argyrides with Oppenheimer & Co.

We'll go with a couple from us, not just the one that you guys suggested. So how are the current launch dynamics with neffy informing your initial commercialization strategy? Particularly, what are some of the tools you can use to create awareness? Are you considering DTC? And then in your dialogue with the FDA, can you remind us what components of the data they are focused on and key considerations for approval? And then lastly, given the product profile, how should we think of scripts per patient per year? Is it multipack? I'll stop there.

Sure, Andreas. And I'll have to find out the question that we recommended to you. I'm kind of curious to know what that was. But having said that...

Dan, it was limiting it to one question per analyst.

Got you. I thought we were giving you questions about that. How about that, that was news to me. I think that was more trying to manage the time. But Andreas, of course, happy to answer your questions and spend time with you. So let me take a couple of those. In terms of awareness, I will hand that over to Sherry in a minute here.

In terms of where the FDA has been focused, it has -- and just to remind everyone, we have 6 FDA approvals in our past. So when you go through the FDA approval process, there's a cadence, there's a pace, there's a feel. And you look for the questions to come from a variety of areas. And that's what we're seeing here, that the different functions in the FDA are doing their jobs, completing their checklists and asking us the questions you would expect. So that feels really good.

In terms of DTC, when I hear DTC, I will admit I default to big television ads like the World Series or the Super Bowl and splashy campaigns. Sherry and I are very aligned. We're not doing that in 2026. Now in 2027, 2028, who knows? But before I hand it over to Sherry, that stuff, you won't see. And that's where we'll be very efficient. But let me have Sherry tell you more about her thoughts on awareness.

And thanks for the question. One of the benefits of being second is that you get to see what those ahead of you went through. And so our teams continue to systematically assess and gather insights from the most recent launch to inform our commercialization plans. But I'm going to go back to -- and I'm going to keep coming back to our plan is very differentiated in that we are going to be very focused, very disciplined and have a patient-centric launch.

And so while our competitors may have gone out with be very broad in all of their sales and marketing tactics, we're applying this very disciplined approach to focus on and drive adoption among the most productive prescribers at launch. And as I said a lot of times, the epinephrine market is an inch deep and about 10,000 miles wide. Prescribers range from primary care physicians who write 1 to 2 prescriptions annually to allergists who prescribe 200-plus prescriptions of epinephrine per year.

And so the allergists are the most productive segment, and so we are taking a very disciplined approach with the allergists to launch. And so what you'll find is we will -- as we drive our results, our market access and payer coverage comes on board, we will have the ability to scale. And so that is a different approach that we're employing.

As it relates to DTC, Dan and I always -- we do laugh about this, what is DTC? At the end of the day, we're applying that same disciplined approach to DTC. Our prelaunch plans and activities have been focused on HCP. Dan mentioned the CME activities. We've also been driving non-CME programs, publications, congresses, being with the community KOLs and at state level allergy associations and congresses.

Our plan post launch is to drive awareness, number one, and most importantly, with those allergists and to get them ready to prescribe as they see the patients that come in who are patients who will benefit from Anaphylm. That's very important. Over time, we will layer in then that strong consumer and caregiver awareness. But there is a disciplined, timed approach to it. So you will see DTC from us, not necessarily TV in year 1, but there will be a number of activities, digital, print, et cetera, that are aimed at the consumer.

And Andreas, I'll take a question one part D. So in terms of the number of scripts, rather than -- so the way we look at it there is a desire among this patient population to have multiple scripts because they want to have product put in different places, at grandma's house, in their child bag, at the nurse's office, in their bag or on the back of their phone. And so there's a reality around pricing and market access that all of us, not just Aquestive, but all of us have to work through. But our goal is to enable people to have as many scripts as possible.

Our next question comes from the line of Francois Brisebois with LifeSci Capital.

So just a couple. Can you -- Sherry, you kind of talked about a more targeted approach. Can you break down a little bit more on the allergist front? And just how many are there? And are they tiered in terms of like certain allergists are definitely the ones to target at first? And then can you touch on how many reps could help you get to that point?

Yes. It's a good question. Thanks so much for answering that. As I mentioned, the allergists are the most productive segment. They prescribe on average 200 prescriptions annually. That's a lot of prescriptions. So our reps will be focused in the allergy space to call on all of the allergists. Now obviously, within that allergist pool, there are some prescribers that are more productive than others.

But overall, we know that by -- and based on my experience, as you probably know, I ran the EpiPen brand team for a number of years where we grew the market from about 1.5 million scripts to 3 million scripts. And so what we know is and what I know is that allergists space is key. When you think about the prescriber base, that prescriber base of about 5,000, we would expect to launch with the sales force, as we've said publicly before, between that 50 to 60 reps and managers.

Okay. Great. And then maybe, Dan, you touched on the growth of the market. I think that's coming up a lot. A lot of people are interested in whether or not this market, just you're taking share of it or you're growing the whole thing. Can you help us understand where the 9% you mentioned come from?

Yes. Yes, Frank. So to give a little bit more precise when we just look at the script data that's in the systems we can access, 8.8% growth in Q3, 7.5% growth year-to-date in the space. When you break that down into where the growth is coming from, by far, the larger number of script growth is in auto-injectors. So I think what you're seeing is as awareness is pulled into the space, that just grows -- it's the rising tide raises all boats is our interpretation of what we're seeing.

The second biggest category, of course, is the nasal spray scripts. So we do think that you're seeing the two elements play out. One is the switch over from one product to another, and two is just the expansion of the overall market. So we think that's a very healthy place to be. 95% of scripts remain auto-injectors, and that's what we'll target.

Our next question will come from the line of Jason Butler with Citizens.

First one, when you speak to physicians, when you do your market research, aside from the advantages of the administration route and convenience of administration, what are the aspects the physicians -- product profile the physicians are really focusing on? To what extent is it PK profile versus safety tolerability versus anything else?

And then just another question on your comments about the AdrenaVerse platform. Does part of this effort involves applying the prodrug technology to any other molecules beyond epinephrine?

Yes. Jason, so I'll give my initial thought, but I'll ask Dr. Gary Slatko, to give his view on what will be most important from physicians from an efficacy or safety profile perspective. So what I've seen is that you have a product with EpiPen that's been in the market for 45 years, right? So the HCPs want to make sure that the product we're bringing to market has the same ability to help patients that the product that's been out there for 45 years has done. And I think we have a really compelling package that does that. And I'll let Gary add his thoughts.

Yes. I think many of the products in the epinephrine class are intended to stabilize the cardiovascular system in the event of anaphylaxis and reverse the [ mass ] degranulation that's occurring that's underlying the allergic reaction. And the characteristics we've seen in terms of blood levels and pharmacodynamic effects are very similar across the board to the comparator products.

Anaphylm has a couple of interesting characteristics that might translate into clinical benefit but would need further studies such as its speed of increase in its blood level and early time to maximum concentration and its sustained effect as well are both could bode well for having a treatment benefit in patients who need an early robust intervention.

I think the other thing that -- the question that clinicians might have it has to do with can it be administered. Can it be administered and is it safe? And administration, we have a very robust human factors program, which has looked at everything which way about different conditions of administration, self-administration and the like. And all of them have shown that this product can be administered in the field by patients successfully. And the safety profile, as with all epinephrines, is consistent with what we see with all the existing product. So I think we've got a very comparable profile overall and some interesting potential advantages.

Yes. And let me move on to the second question, Jason, you had, which was around AdrenaVerse. So look, just prodrugs is not that unique in our space. So I don't know -- our intellectual property estate really is around epinephrine in a prodrug form because that's the white space we found and created. So I think in the near term, you'll see us focus on solely epinephrine. But with the significant resources and expertise we're bringing into our development area, we, of course, are always looking at what other technologies or expansion in technologies can we meaningfully use to bring better products to the patients.

[Operator Instructions] Our next question comes from the line of Gary Nachman with Raymond James.

This is Denis Reznik on for Gary Nachman. So you recently announced two new patents for Anaphylm. Can you just talk more about them and how important these two specifically are for the overall patent portfolio? And then on supply chain, assuming an on-time approval, how quickly could you get drug into channel? And then how quickly can you get the first prescription filled?

And then if I could just squeeze in one more. Regarding the uncertainty at the FDA that we've been hearing about recently, can you just mention if there's been any high-level individuals that are involved in your review that have been either replaced or have moved on?

Sure. Thanks, Dennis. So in terms of the patents, yes, we had two new patents issued just over a month ago. And both of those patents are focused on the ability to gain absorption and then rapid release of epinephrine cleavage of -- enzymatic cleavage of epinephrine back into its native form. So we believe those are significant Orange Book listable patents. When we're approved, that will be very expansive and blocking for the product. So definitely fundamental to our position.

From a supply chain perspective, look, there's a little bit of work that has to happen, right, when you get approval. So you have to work on the final label, get all the pieces and parts together. We have a great supply chain component of our business. It does go to the core of where we've come from as an organization. I think you know we manufacture in-house. So that will be something we're very ready for and will allow us to have supply in the channel in Q1.

And then the third question, the uncertainty at the FDA, I'm actually -- thank you, Dennis, for bringing it up. I'm actually, I guess, pleasantly surprised that we got this far into the Q&A before that question came up. Clearly, the FDA is going through some pains. From our perspective, our review group has remained the same. We did -- as you heard in my prepared comments at the beginning, we've heard from our project manager that our application is not affected. Obviously, we saw the Head of CDER left over the weekend. But from our perspective, the leadership at CDER is more of just a sign-off on our application than an active reviewer. So we continue to believe we're in good shape on that front.

[Operator Instructions] Our next question comes from the line of James Molloy with Alliance Global Partners.

Let me follow up a little more on the manufacturing capacity. What do you guys -- at the capacity on approval, can you supply the whole market on approval? And where do you guys -- where is that manufactured? And then I don't know if you guys have given any -- on the Anaphylm, what's the pushback that you've gotten from docs on Anaphylm? Because seems like the feedback are positive to date.

Sure. So I think I heard your first question, right, Jim, manufacturing capacity and where is it manufactured?. Capacity-wise, so we, this year, will make 150 million doses of film for all of our other partnerships and arrangements. So when you look at the entire epinephrine market being less than 10 million doses, that means we have plenty of space to make this product. In terms of where it's manufactured, our manufacturing is in Indiana. We do have some component manufacturers that go into our products that are all U.S.-based. So we are a completely U.S.-based manufacturer.

And from Anaphylm, I think your question was what are we hearing from physicians that may be a little bit of pushback or need to be convinced. And I would go back to what Gary said before. With any new product, the first thing you need physicians to feel comfortable with is the safety and efficacy of the product. So that's foundational. We understand that. You heard the depth that Gary brought to how he thinks about it. That's what our medical affairs team is doing every day. And we're prepared to make sure we do a really good job with that piece.

Great. And then maybe just a quick follow-up on 108. Can you talk a little bit on Phase II? I know you said first half '26 and then sort of the size and the duration of that trial should it get started?

Yes, yes. And thank you, I love when I get questions on AQST-108, which is our alopecia areata program. And I look forward in future calls having Matthew Davis here to talk in depth about it. But I felt on day 4, it was probably unfair for me to have him here. So we -- the first study we'll do is a small safety study, which is in just a handful of men who are bald just to make sure we have the safety data we need to fulfill the FDA's requirements. We will then quickly go into our Phase IIa.

Right now, our design is to have it be a 24-week study. We will have data along the way. And that study will look at hair follicle growth over different periods of time. In terms of the size, we're still scoping that out. But I would think of it as somewhere between 40 and 60 individuals.

Thank you. And I would now like to hand the conference back over to Dan Barber for closing remarks.

Thanks, Michelle. And thank you again to everyone for joining us this morning. We really enjoyed the robust interaction from all the Q&A. And as I said earlier in the call, this is a really exciting time where we really feel everything coming together for the company. We have the right financing, the right people and the positive FDA interactions as of today to remain excited about not just our near-term prospects but our long-term prospects.

We look forward to interacting with you again in the near future. And with that, we hope you have a wonderful day.

This concludes today's conference call. Thank you for participating. You may now disconnect.