Fennec Pharmaceuticals Inc. Stock

Thank you. Good morning, ladies and gentlemen, and welcome to FENIC Pharmaceutical's second quarter 2026 Earnings and Corporate Update conference call. At this time, all participants are in listen-only mode. Later, we will conduct a question and answer session, and instructions on how to participate will be given at that time. As a reminder, today's conference call Now I'd like to turn the conference over to FedEx Chief Financial Officer Robert Andrade.

Thank you, Operator, and good morning, everyone. We would like to thank you for joining us. We are pleased to host Fennec Pharmaceutical's second quarter 2026 earnings conference call today. during which we will review our financial results, as well as provide a general business update. Joining me from Fennec this morning is our Chief Executive Officer and Board Member, Jeff Hackman, our Chief Commercial Officer, Terry Evans, and our Chief Medical Officer, Dr. Pierre Sayad. I am also pleased to welcome our Chief Strategy Officer, Christy Chiaffi, who is joining our earnings call for the first time. Christy has more than two decades of leadership experience spanning commercial strategy, brand building, and organizational development, including nearly 15 years of expertise leading award-winning commercialization and launch strategies across the product lifecycle. She has held senior commercial leadership roles at a number of leading biopharmaceutical companies, including Shield Therapeutics, Stemline Therapeutics, USA Pharma, Karyo Pharm Therapeutics, Servier, previously Shire, Exalta, Baxter, and Abbott Laboratories, where she helps build and grow oncology, rare disease, and hematology brands from early development through commercialization.

As a graduate of West Point, Christy also served our country as a decorated U.S. Army veteran and Bronze Star recipient. leading soldiers during two deployments in Operation Iraqi Freedom. Later in the call, Christy will speak to how recent cross-functional efforts are supporting our long-term growth plans. Additionally, Dr. Pierre Sayad will provide a medical affairs update, and Terry Evans will speak to our commercial progress. Before we begin, I would like to remind you that during this call, the company will be making forward-looking statements that are subject to risks and uncertainties that may cause actual results to differ from the results discussed in the forward-looking statements. Reference to these risks and uncertainties are made in today's press release and disclosed in detail in the company's periodic and current event filings with the United States Securities and Exchange Commission. In addition, any forward-looking statements made on this call represent our views only as of today and should not be relied upon as representing our views as of any subsequent date.

We specifically disclaim any obligation to update or revise any forward-looking statements. Conference call is being recorded for audio rebroadcast on Fennec's website, www.fennecpharma.com, where it will be available for the next 30 days. I will now turn the call over to Jeff Hackman. Thank you, Robert, and good morning, everyone.

Thank you all for joining us here today. So before we dive into the quarter, I'd like to take a moment to reflect on how far we've come as an organization. Two years ago, I joined Fennec with clear objectives, build the team, sharpen our execution, and position the company for sustainable long-term growth. Over that, we've built a talented and experienced leadership team. Deep expertise across commercial, medical affairs, clinical development and corporate strategy. Today you'll have the opportunity to hear from each of them about the progress that they're making in their business. We also expanded our customer-facing team, as you know, to reach a larger prescriber target base with a greater frequency, increasing the numbers from 1,300 to roughly 5,000 targets.

Together, we've built an organization that is focused, accountable, and aligned around delivering for our patients, our healthcare providers, and our shareholders. I'm proud of what we accomplished. Since I joined the company, we've increased revenue by 143%, driven by a unified strategy, consistent execution, and a disciplined focus on the fundamentals of our business. Perhaps most importantly, we've demonstrated that this isn't the result of any single initiative or quarter. It's been built through steady execution, expanding our commercial reach, strengthening our clinical evidence base, investing in targeted talent across this organization, and maintaining a strong Financial Foundation. Today's results, including our seventh consecutive quarter of growth, reflect momentum we've created and the commitment of our entire organization. I'd like to thank everyone here and take this opportunity to thank all Fennec employees for their exceptional work to help ensure that these patients face in cancer treatment can continue to hear the moments that make life most meaningful.

While we're proud of our progress, we also believe we're still in the early stages of our opportunity. As you'll hear today, we're continuing to invest in the drivers that we believe will support long-term growth. generating additional clinical evidence and expanding physician engagement to building awareness and ensuring that we have resources to execute on our strategies. One of those drivers in Q2 was breaking new ground in a disease awareness campaign, bringing the conversation around testicular cancer to the Indianapolis 500 and introducing FENIC and our mission to millions of fans and forging meaningful connections across the oncology community. Kristi will go much deeper into detail and the impact of this campaign shortly. As a reminder, PEDMARC is currently approved for pediatric patients one month of age and older with localized non-metastatic solid tumors and is also recognized by the National Comprehensive Cancer Network with the 2A recommendations for use in AYA patients. As we look ahead, we believe the investments we've made across our commercial organization, the clinical evidence generation efforts and the financial foundation is translating into meaningful momentum. Encouraged by what we've seen so far in the third quarter, we are confident in our ability to continue to build on this progress and deliver sustainable growth.

So with that, I'll turn it over to Chris for a more detailed update on our disease awareness efforts and our presence at ASCO. Thank you, Jeff.

As Jeff just mentioned, over the past two years, we've been very intentional about evolving not only how we position PEDMARC, but also how we engage the oncology community. In 2025, we reinvented our commercial approach with a bold, differentiated, branded campaign called Survival Should Be Loud. This campaign challenges convention, resonates strongly with oncologists, and has helped to establish a leadership position for both PEDMARC and Fennec. Building on that momentum, 2026 represents the natural next phase of that evolution. In May, we launched a disruptive disease awareness initiative to wake up a broader audience to the issue of Cisplatin-induced hearing loss, or CIO. As we've shared in the past, Cisplatin is the cornerstone of testicular cancer treatment. transforming the disease from a frequently fatal diagnosis to one with a cure rate exceeding 95%. In support of this community, we created an innovative campaign targeting testicular cancer awareness called Indy's Nuts.

This campaign, with multiple strategic collaborations, launched at the Indianapolis 500, one of the world's largest sporting events. Through sponsorships with race car driver Jack Harvey and NFL linebacker Alex Singleton, the campaign was intentionally designed to stop people in their tracks. This bold, unexpected, creative concept included distribution of over 100,000 bags of peanuts. to capture attention, spark curiosity, and encourage audiences to learn more. two important objectives. First, to encourage men to perform regular testicular self-exams and promote earlier diagnosis of testicular cancer. And second, to educate patients diagnosed with testicular cancer about the importance of discussing CIO and hearing prevention with their care teams before treatment begins. Additionally, we sponsored an educational event with leading KOLs from a renowned institution in the region to deepen understanding of CIO prevention and the role of PEDMARC. Importantly, the initiative demonstrates our ability to reach and engage audiences well beyond traditional healthcare settings, further expanding awareness of both the disease and the unmet needs surrounding CIO.

We are extremely pleased by our campaign performance metrics that exceeded industry norms in several categories. The momentum did not stop at the Speedway. We carried that same energy and awareness into the ASCO Annual Meeting, where the racing theme became a natural conversation starter at our booth. Through the draw of racing simulators and interactive experiences, we engaged with oncologists, advanced practitioners, nurses, patient advocates, and industry leaders in meaningful discussions about hearing preservation and the role of PEDMARC in addressing the unmet needs of CIO. Throughout the meeting, the Fennec Speedway generated exceptional engagement and quickly became one of the most talked about exhibits on the show floor. It was even featured as a part of Fierce Pharma ASCO's wrap-up article. Our cross-functional team generated hundreds of HCP leads and received overwhelmingly positive feedback from attendees who appreciated both the interactive education and the important clinical conversation the booth enabled.

Pierre will speak more about ASCO shortly. For us, that was the ultimate validation. ASCO wasn't simply memorable. It created an effective platform to educate healthcare professionals, amplify our mission, and reinforce CENIC's leadership in changing the standard of care for the prevention of CIO. With that, I will now turn the call over to Pierre for a medical update.

Thank you, Christine. Good morning, everyone. The second quarter for medical affairs was one defined by expansion. We have a fully trained, fully deployed MSL team. This team engaged with a record number of new HCPs as well as affiliated sites and HCOs in Q2, adding significantly to an already growing target base. In fact, our total unique HCP reach increased 63% and unique affiliated sites increased 72%. This team is successfully converting the scientific field engagements from HCP educational gaps to further clinical conviction as we collaborate across functions to change the standard of care with Petmark. During the quarter, we also advanced our evidence generation efforts with impactful presentations at ASCO and through an expanding portfolio of Investigator Sponsored Studies, or ISTs.

In April, we announced a third ISP with the University of Arizona Cancer Center to evaluate the use of PEDMARC in AYA and adult patients with head and neck and testicular cancers receiving cisplatin. This news follows the initiation of two other institution-led clinical studies with Tampa General Hospital Cancer Institute and the City of Hope. These studies are actively accruing patients. We are also engaged in discussions to grow this pipeline of ISPs, which will further expand our understanding of PEDMARC's potential. Importantly, these conversations are across multiple tumor types and across various patient populations. One of the most encouraging takeaways from our presence at ASCO in June was the evolution of the conversation. Discussions are now moving beyond general awareness of cisplatin-induced hearing loss to implementation with healthcare providers asking practical questions about incorporating PEDMARC into standard treatment workflows.

We believe this reflects increasing clinical confidence and growing momentum towards broader adoption. In Q2, we nearly tripled our medical congress footprint at both national and regional conferences. At these meetings, gynecologic cancers were of particular interest and generated significant discussions and insights surrounding the market opportunity in this area. We heard from multiple leading academic gynaecologists that there is limited PEDMARC awareness despite recognizing CIO, reinforcing our medical affairs strategy to expand structured education into gynecology alongside head and neck and testicular cancers. specific tumor areas account for nearly half of our medical target base. Our field medical team plays a critical role in the education of physicians. The depth of our team's scientific knowledge and respected standing within the academic community are a true competitive advantage. Our evidence generation strategy continues to gain momentum beyond ASCO.

We are pleased to share that the investigator-initiated Phase 2-3 STS-J01 clinical trial evaluating PEDMARC for the reduction of CIO in pediatric and AYA patients with non-metastatic solid tumors in Japan. has been selected for an oral presentation at the SIOP 2026 Annual Meeting in September. These data will mark the first public presentation of human pharmacokinetic data, representing an important milestone in deepening our understanding of the clinical profile and potential of PEDMARC to change standard of care. Oral presentations are reserved for research considered to be of particular scientific interest, and we believe this recognition reflects the growing clinical focus on preventing hearing loss in children receiving cisplatin-based chemotherapy. We look forward to sharing more details on the full results in September. Together with the data shared at ASCO earlier this year, these presentations continue to expand the scientific dialogue around hearing loss prevention and reinforce our commitment to supporting the generation of high-quality evidence. With that, I will now turn the call over to Terry for a commercial update. Thank you, Pierre, and good morning, everyone.

Our newly expanded sales force is driving a positive impact in the first quarter. Commercial demand continued to grow in Q2, which is attributed to our disciplined execution and greater reach and frequency. With prescribers underscoring, we have a repeatable and scalable platform for growth. For example, in the second quarter, we saw a 280% increase in the number of sales calls made by our field sales team. Demand in Q2 grew double digits over Q1. driven primarily through our patient services hub called Finnecure's. In fact, Finnecure saw a significant increase in patient enrollments that led to an all time high number of infusions for the quarter. Q2 also delivered record AYA enrollment supported by the NCCN 2A recommendation.

Additionally, more than half of our business came from the home infusion center. This flexible at-home scheduling option works for both patients and providers by making it easier to start therapy and to stay on therapy. Importantly, this record patient enrollment in Q2 has helped create real momentum with unprecedented demand carried into the third quarter. In fact, in the month of July, we recorded an all time high of completed PEDMAR confusions new patient enrollments, active patients on therapy, and new customers in a single month. As we have discussed previously, continued commercial growth depends on strong alignment and execution across our organization. We are encouraged by how our expanded sales force has partnered with our market access and medical affairs teams to deliver a coordinated customer experience as we work to change the standard of care with Bedmark. To give you an example of this teamwork in action, these groups recently collaborated to secure a major formulary addition with a nationally recognized community oncology network. by combining strong sales and account management with compelling clinical education. we successfully added Pedmark to their formulary, which expands access and creates new opportunities for patients.

This achievement demonstrates the strength of our integrated commercial model and our team's ability to drive meaningful results. In summary, there are several positive trends that we're carrying into Q3, including overall vial demand, number of vials per patient, new patients entering the funnel, and infusions ordered and completed. We are optimistic that this commercial success will continue to reach record levels in the second half of 2026. With that, I will turn the call over to Robert for a financial update.

Thank you, Terry. Our press release contains details of our financial results for the second quarter of 2026, which can be viewed on the Investors in Media section of our website. As customary, rather than read through all of those details, my comments today will focus on some key financial results. Of note, a table reconciling non-GAAP measures was included in today's press release for reference and will be in our accompanying 10-Q filed with the SEC. For the second quarter of 2026, the company recorded net product sales of 17.1 million compared to 9.7 million in the second quarter of 2025. representing an increase of approximately 78% year over year. We witnessed the highest amount of new patient enrollment in the second quarter and carry record demand for PEDMARC into the third quarter. On the OpEx side, which we define as R&D and SG&A excluding stock-based compensation, it was approximately $13.6 million for the quarter, with a year-over-year increase of approximately $3.6 million. The majority of the increase... was on the SG&A with expanded marketing investment focused on awareness initiatives and increased commercial headcount supporting PEDMAR growth.

Consistent with prior commentary for 2026, we expect approximately $50 million in total cash OPEX 2026. with approximately $20 to $22 million, or 40% of those expenses, left to be recorded in the second half of 2026. We are focused on EBITDA generation and cash flow as we grow the business and as such are presenting record non-GAAP adjusted EBITDA in the second quarter of approximately $2.8 million compared to a loss of $1.2 million in the comparable quarter a year ago. We have significant leverage in the business with a predominantly fixed cost base. And as our revenue growth continues, we anticipate operating income and non-GAAP-adjusted EBITDA to grow meaningfully in the quarters to come. EPS in the second quarter of 26 was $0.05 per share. compared to cash and cash equivalents were $41.2 million as of June 30, 2026. For the quarter, there was a $1 million increase in cash and cash equivalents, which was higher than we anticipated for the quarter. As we have stated previously, as we grow the business, we anticipate select quarterly swings in cash position based on collection cycles with customers. as such expect the third quarter ending cash to be lower than the second quarter.

However, we expect the fourth quarter cash generation and our year-ending cash to be positive. Lastly, as we stated in our press release, we anticipate that our cash equivalents and investment securities as of June 30, 2026, coupled with the projected revenues from PEDMARC, will be sufficient to fund our business based on our current operating plan. Operator, with that, we are now ready to open the call for questions.

Thank you. At this time, we'll conduct the question and answer session. As a reminder to ask a question, you will need to press star 1-1 on your telephone and wait for your name to be announced. To withdraw your question, please press star 1-1 again. Please stand by while we compile the Q&A roster. And our first question comes from the line of David and Selin of Piper Stanley. Your line is now open.

Thanks. So just a few for me. First, regarding the testicular cancer population, can you talk to how how much of your overall patient mix right now is coming from young men with testicular cancer. or maybe asking another way, what portion of your new starts on Tedmark are in to stick cancer patients. And then secondly, can you give us a sense of the mix between using usage in academic centers versus community oncology practices. and how is that trending? And then lastly, wanted to pick your brain on life cycle management and what you think you can do or have you given thought to ways to better improve the profile of Pedmark. Thanks.

Perfect. Thank you. This is Jeff. I'll take these and then we'll kind of pass them through some of the folks here. So, thanks for the question. I appreciate it. You know, testicular cancer continues to be a driver for our business. It's the largest AYA tumor type that fits, you know, our PEDMARC profile. So those numbers for AYA, the size of the market is larger than the rest of the... the tumor types, again, we're agnostic on tumor types, as you know, because we target cisplatin usage. And it doesn't matter what tumor type it is, it's still going to have the impact to the hearing.

So, maybe I'll have Terry, talk a little bit about the testicular market. He can kind of give you a little bit more detail, and then I'll jump back to the academic and community setting. Go ahead, Terry. Yes, sure.

And what we're seeing is roughly typical of what we had in Q1, however, slightly better in testicular cancer in Q2 with regard to, you know, that particular tumor type and PEDMARC utilization. We've got over 80% of our patients. right now between testicular, cervical, and head and neck. And predominantly, it is testicular that's the larger driver of all of those. And it really does speak to our commercial execution, sticking on our targeted plan, our sales force calling on the right folks at the right time, and then collaborating with our colleagues in market access as well as medical. That's really driving the business forward. The next question was about academic versus community. You can take that. Yes, go ahead, Jerry.

So we see a really nice balanced approach between both academic and community. I've mentioned a formulary win in the community, but we also see really fantastic things happening in our community. our academic setting as well. I wouldn't characterize it by one leading more than the other. Both are growing really nicely with the additional sales force that we have. Yes, perfect. Thank you, Terry. And the last is the lifecycle management. Your comment on that's a good one. And I might have Pierre touch on that a little bit because I think what you're hearing.

from a lifecycle side is really coming from some of the ISTs that we put out there. There are a few areas where we think we can significantly grow the business, potentially even based on publications from these ISTs as the data comes in over the next few years. So, Pierre, maybe talk a little bit about some of those areas that you see from your ISTs. Pierre Coggani Sure, sure. So, thank you for the question. You know, the data generation is really leading to kind of a multi-pronged approach. So, as patients are quickly accruing across the three existing ISTs, so City at Hope, University of Arizona, and Tampa General Hospital, we have an abundance of increased interest in additional ISTs. And importantly, these are across tumor types. across patient ages, and localized as well as metastatic disease.

So as the data matures, we are certainly having discussions with the regulatory agencies to see is there opportunities for label expansion. Additionally, we are very keenly looking at NCCN guidelines. and seeing opportunities for having increased guideline recommendations there as well. Great.

Thank you. We'll move on to our next question. Our next question comes from the line of Chase Knickerbocker of Greg Havlum. Your line is now open.

Good morning. Congrats on the results here and thanks for taking the questions. Maybe just as far as how kind of that productivity of the new reps is trending, were they meaningful contributors to Q2 growth? Just trying to get a sense for what inning, how early are we in kind of their productivity ramp? Thanks.

Sure. Thanks for the question, Chase. I'll take a little bit of it and then I'll give it to Terry. But you heard from some of my comments, we now are approaching close to 5,000 targets that we're calling on. It is having an impact. We're seeing patients in places in the country where we've never seen patients before. And as we even hinted a little bit on our Q3 numbers, our July continued that momentum that we're seeing. So one of the things we said early on was give these guys a little time, now they've had a quarter under their belt. but we're still not, they're going to continue to grow and get better at what they do. They need to understand like where they're going, multiple times we have to be in these offices obviously before we can we can move physicians and so give them a little time but but what I would say is.

The growth of what we're seeing, a lot is coming from our new reps. And maybe, Terry, you can comment on the success of what you're seeing too. Yes, there's no doubt about that. The new reps are adding to the success. And across the board, coast to coast, these are fantastic people. Great humans to start with, but really great people. good salespeople and they're decorated before they got here and it's not it's not really an accident looking across there for us that I mentioned the cross-functional model, the collaboration that we have with our medical affairs team, as well as our key account team. It's in that collaboration where... These guys are doing such a wonderful job.

There's consistency. They're hustling every day, and it really resonates in seven straight quarters of growth. So I'm super proud of these guys. They are on the curve, though, keeping in mind, Jeff mentioned this, that they started in early March. Okay. And we've got one full quarter, and they're on the growth curve of their education and them getting around to see everybody.

Yes, but I can tell you the seven straight quarters, and we mentioned July, and I think Terry commented on it, Chase. July, we recorded a new all-time high of completed PEDMARC infusions. a new all-time high of patient enrollments, and also an all-time high of active patients. And so you're seeing new customers a record month in July, and we don't plan on slowing down. So I hope that answers your question, Chase.

It does, Jeff. And maybe just to kind of piggyback on that comment a little bit, you know, growth accelerated again sequentially in the second quarter. You just kind of talked about kind of record demand you're carrying into Q3. Seems like we've got, you know, meaningful potential utilization gain to still get from some of those newer reps. I mean, with all that together, should we be thinking about your business, you know, accelerating from a growth perspective sequentially? maybe just give us a little bit more color as far as exactly kind of what you're seeing in July and how we should think about the back half of the year here.

as your business is clearly starting to help. I'll comment and then I'll let Robert jump in, Chase. But you know that we have said, the back half of the year is where we'll see, we'll see our growth. But we're showing growth in the first and second quarter. So yes, your question is just how fast and how big and where do we see this going? When we came out of the first quarter, April was a record month for us coming into the second quarter. of the second going into the third and July is a record month for us so we're continuing to see significant significant growth I expect that to continue through this third quarter and into the fourth maybe Robert you can comment from your side on you know on some of the things that we share.

Yes, Chase, just to echo really Jeff and Terry's comments, July was an outstanding month. Early on in August, obviously we're August 11th, that continues. And also in line with that, the productivity curve we expect to ramp up. So we're not going to get into details in terms of how much growth, but needless to say, we are quite pleased with where we stand today in the third quarter. Very helpful guys. Thank you. Yep.

Thank you. One moment for our next question. And our next question comes from the line of Raghuram Zivaraju of AC Windright in Culligan. The line is now open.

Thanks so much for taking my questions and congratulations on a very solid quarter. Firstly, I wanted to ask about what your outlook is with regard to the timeline with which you might be in a position to provide us with a revenue guidance range, if not for this year, then potentially for 2027. Secondly, I was wondering if you could provide us with any grants. on when you anticipate a potential shift in NCCN guideline category classification for PEDMARC based on the available evidence. I was also wondering if you could tell us a little bit about potential techniques, strategies to ensure that enrollment pace in the various ISTs, both the ones that are currently enrolling and the ones that you expect to come online, would proceed at a reasonable, albeit if not accelerated pace. And then lastly, if you could just give us an update on potential launch preparations, commercial assessments, in preparation for the introduction of PEDMARK in Japan and how you are thinking about partnership strategy over there, that would be very helpful. Thank you.

Sure, sure. Great questions, thank you. I'll start and I'll hand over to Robert real quick. I know we have said time again that we don't provide formal revenue guidance. We haven't for this year. That being said, we're encouraged by what we're seeing and the trends we're seeing. And can we go into 27 with the opportunity to be able to give guidance for 2027? That's something Robert and I are talking about. And listen, as you grow a company this rapidly like we were doing and make as many changes as we are, We didn't want to, the worst thing you can do is miss guidance. That being said, we'll be in touch with where we go from there on guidance for 2027.

If you look for our IST updates and where we are and your question on that, maybe I'll let Pierre speak a little bit more towards that question on the ISTs, because I know you were talking about enrollment and some of the numbers. And again, we're not publicly tracking those numbers out,.

but we can talk a little bit about, I think, the momentum that we're seeing. Sure, sure. So, obviously, we need to be very careful that we as a company don't interfere with ISTE accruals for compliance reasons. That said, we have helped each institution drive awareness within their own organization within their own circuits, if you will, allowing all the other physicians to know that the ISTs are open and actively accruing. So we are very encouraged by the early numbers that we're seeing and we're looking So, yes, I'll stop there on that in terms of IST accruals. In terms of the question for NCCN, we have a very focused strategy as to when this data will finally mature so we can take it to different NCCN boards, including Head & Neck, Gynonc, as well as Tested. but it really is a function of getting the data.

Data first and then move. Yep. The other is Japan, and one of the things you had asked about kind of where's the status and what do we look like with the partnering and licensing opportunities in Japan. We're encouraged by the discussions that we've been having. As you heard from Pierre, the data is now getting picked up at multiple meetings, not just ASCO but now SIOP. We're excited about the STS-J01 data and what a potential opportunity it represents. We're engaged with, like I said, a number of folks in Japan on the ground, both actually, matter of fact, Pierre and I will be there next week meeting with our team Hiroshima as well as meeting with potential partners and and partners that we've been in discussions with for a while our focus really is we want to have the right path forward for the product there and and not just for just Japan, but for Asia-Pac. So we're taking our time, but we want to do this right, and we want to maximize the long-term value for that region for this product.

But most importantly also, we want to get this product approved in Japan as fast as we can. So I hope that answers your question.

Yes, it does. Thank you so much. And one last quick one. Jeff, I know I've asked this a couple of times in the past, and I was just wondering if there's been any evolution in your strategic thinking regarding the possibility of in-licensing anything that might be complementary to PEDMARC for your sales force to sink their teeth into, given the fact that you've now built up a very good head of steam with that product. You know, are you thinking about potentially other opportunities, commercially speaking, within oncology supportive care?.

We are, and we talked about this in the past. And now that the team is really, you know, starting to perform and execute the way they are you can imagine that there's an opportunity to be able to put something else you know, in their bag and so to speak. So we're looking at that. looking at it, we get opportunities coming across our desks. All of us here that you've heard on the call, all are helping evaluate these opportunities. So yes, we continue to do that. We haven't seen anything just yet. but we're open to those discussions, as you know. Thank you.

Thank you. I'm showing no further questions at this time. I'll now turn it back to Jeff Hagman for closing remarks.

Perfect, thank you. So, thank you all for joining the call today and As you know, and especially the questions and your participation here at the end, thank you. In summary, as you know, we execute an incredible set of priorities here at the organization. They reinforce our long-term growth, they advance the clinical evidence, and they drive commercial performance. And we maintain a strong financial position as we continue all of these initiatives. Combined with the encouraging trends that we're seeing early in the third quarter, we believe we are well positioned to continue to sustain our growth and momentum throughout the remainder of the year. I want to thank you all for joining the call today, and this is the end of FENIC's second quarter call.

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

This live transcript is auto-generated without human intervention or review.

[Call has ended.]

Good morning, ladies and gentlemen, and welcome to the Fennec Pharmaceuticals First Quarter 2026 Earnings and Corporate Update Conference Call. [Operator Instructions] As a reminder, today's conference call is being recorded.

I would now like to turn the conference over to Fennec's Chief Financial Officer, Robert Andrade. Please begin.

Thank you, operator, and good morning, everyone. Thank you for joining us. We are pleased to host Fennec Pharmaceuticals first quarter 2026 earnings conference call today, during which we will review our financial results as well as provide a general business update. Joining me from Fennec this morning is our Chief Executive Officer and Board member, Jeff Hackman. I am also pleased to welcome our Chief Commercial Officer, Terry Evans, who is joining our earnings call for the first time.

Terry is a seasoned commercial and operations leader with a proven track record for delivering significant revenue growth and leading high-performing teams. Terry's industry experience spans all facets of commercial operations, including sales, sales management, operations, market access, trade, specialty pharmacy and data analytics. He has more than 25 years of commercial leadership experience with companies, including Currax Pharmaceuticals, Horizon Therapeutics and Medisys.

Since joining Fennec in the fourth quarter of 2024, Terry has played a pivotal role in reshaping and strengthening our commercial organization. He has helped to sharpen our execution, enhance our field presence and position the team to capitalize on the opportunities ahead. Later in the call, Terry will speak to how recent efforts will support Fennec's next phase of growth. Additionally, our Chief Medical Officer, Dr. Pierre Sayad, will join us for the Q&A portion of today's call.

Before we begin, I would like to remind you that during this call, the company will be making forward-looking statements that are subject to risks and uncertainties that may cause actual results to differ from the results discussed in the forward-looking statements. References to these risks and uncertainties are made in today's press release and disclosed in the company's periodic and current event filings with the United States Securities and Exchange Commission. In addition, any forward-looking statements made on this call represent our views only as of today and should not be relied upon as representing our views as of any subsequent date. We specifically disclaim any obligation to update or revise any forward-looking statements. This conference call is being recorded for audio rebroadcast on Fennec's website, www.fennecpharma.com, where it will be available for the next 30 days.

I will now turn the call over to Jeff Hackman.

Thank you, Robert, and good morning, everyone. Thanks for joining the call here today. We are encouraged by our strong start to the year and believe 2026 is a defining period for Fennec. Our conviction is rooted in the progress across many multiple fronts. We've made important strategic enhancements to our business for 2026 that are strengthening our execution across the organization and positions us to continue to build momentum as the year unfolds. On the commercial front, we're seeing encouraging early indicators, including positive experiences through our full-service patient support program, Fennec HEARS, as well as trends that support our confidence in the opportunity ahead, and Terry will provide more color on those dynamics shortly.

Beyond commercial execution, we continue to be encouraged by growing clinical interest in PEDMARK and its broader potential. We are pleased to have recently announced a third investigator-initiated study with the University of Arizona Cancer Center to evaluate PEDMARK in adolescent and young adults or AYA and adult patients in head and neck and testicular cancers receiving cisplatin. The news follows recent initiations of 2 other institution-led clinical studies with Tampa General Hospital Cancer Institute and City of Hope. We believe that the data insights generated through these studies and others to come will help support broader clinical adoption of PEDMARK to prevent ototoxicity in AYA and adult cancer patients receiving cisplatin-based treatments.

Additionally, 4 abstracts from key opinion leaders evaluating the utility of PEDMARK in preventing cisplatin-induced ototoxicity or permitted hearing loss were accepted for the presentation at this year's ASCO Annual Meeting. Collectively, these studies are continuing to the momentum and the growing body of evidence supporting potential use of PEDMARK in new patient populations and tumor types.

As a reminder, PEDMARK is currently approved for pediatric patients 1 month of age and older with localized non-metastatic solid tumors and is also recognized by the National Cancer -- or National Comprehensive Cancer Network with a 2A recommendation for use in AYA patients. With regards to Japan, we had a positive informal PMDA meeting earlier this quarter. We continue to be in conversations and to explore partnering opportunities in that region.

So in summary, we're making meaningful progress across the drivers that matters most to our long-term success; expanding clinical momentum, strengthening commercial execution and maintaining a solid financial foundation. Taken together with what we are observing early in Q2, we believe we are well positioned to deliver sustained growth throughout this year.

With that, I will turn it over to Terry for a detailed commercial update.

Thank you, Jeff. As Jeff just noted, we're encouraged by the momentum we're seeing in the business and believe our first quarter performance reflects the benefits of the key strategic enhancements we've made across the commercial organization. In late Q4 2025, we launched an initiative called Project Ignite. This was a strategic decision based on successful cross-functional initiatives put in place at the start of 2025. Building on the shared insights and strong commercial execution, we use data to evaluate opportunities to optimize both reach and frequency.

Our Q1 investment in 14 new territories and 4 frontline managers expanded our ability to engage health care professionals, support adoption and drive sustained momentum across priority markets. Much of the quarter involved the foundational work required to bring those investments fully online, recruiting and onboarding new talent, completing training and integrating these team members into our commercial model. The recruitment and onboarding process concluded at our national meeting in early March. This was an important milestone to align the expanded organization around our strategy, sharpen execution and ensure the team entered the field equipped and ready to execute.

There is a natural ramp period with any field force expansion and we view much of Q1 as laying that groundwork. The expansion of our customer-facing team has allowed us to reach with greater frequency, a larger prescriber target base, increasing from 1,300 to now over 5,000 targets. We know the AYA market is promotionally sensitive and effectively communicating the unmet need around CIO is our #1 priority. This creates a pathway for practices to help change the standard of care for all appropriate patients receiving cisplatin. We believe we're executing in Q2 with a strengthened commercial footprint that is now positioned to drive greater impact through increased reach, frequency and account penetration.

Importantly, we're already seeing encouraging signs from these investments through our HCP targeting efforts. To bring our cross-functional model to life, one recent example illustrates how coordinated engagement can translate into adoption over time. About a year ago, our medical team initiated engagement with a KOL from a leading academic center who was familiar with CIO, but not aware of PEDMARK as a preventative treatment option.

Through multiple scientific exchanges and participation in a sponsored program at ASCO GU alongside the Testicular Cancer Awareness Foundation, awareness evolved into meaningful engagement. And more recently, that relationship was transitioned from medical to field sales. A newly deployed territory manager with our Key Account Director introduced Fennec HEARS, which facilitated this KOL's identification and treatment of his first testicular cancer patient for home infusion. Since then, the engagement is actively expanding across the institution with multiple physicians across tumor types now positioned to prescribe and treat more than 20 patients with PEDMARK.

Now in parallel, we're working collaboratively on order sets and EMR integration. This example highlights a key principle. Durable growth stems from persistent cross-functional engagement across medical, sales, market access and patient support services. Another example of significant progress is through our market access initiatives, specifically in terms of engaging with GPOs. One of the fastest-growing oncology aggregators in the U.S. has partnered with us to integrate PEDMARK throughout their network with order sets and site activations.

We have ongoing efforts with other organizations to replicate this model that supports a top-down adoption approach, complementing the expansion of our sales force focused on bottom-up activities. At the macro level, we continue to see a healthy mix of both new and existing prescribers. Many established accounts are becoming more comfortable with PEDMARK, contributing to deeper utilization and increased vials per account. We view that continued adoption and growing depth of use as an important marker of durable demand. In fact, demand in the first quarter was driven by prescribing in 3 core tumor types: testicular, cervical and head and neck cancers, and these remain foundational to our commercial opportunity.

Another area we would highlight is cross-functional collaboration across all parts of our organization to convert prescription demand into completed therapy. This collaboration comes together through Fennec HEARS, our full-service hub designed to simplify access and support continuity of care by guiding patients and providers through coverage, reimbursement, nurse-led administration and at-home infusion services. This white glove support and education continue to be a meaningful differentiator as we change the standard of care. That coordinated approach is reflected in the operational metrics we're seeing.

We continue to see strength in infusion volume and vial utilization. This is reflected in a 48% quarter-over-quarter increase in completed infusions through Fennec HEARS and reinforces our ability to translate prescription demand into completed therapy. From a site of care perspective, we're maintaining a productive mix of approximately 50% from both in-office and at-home infusions, which supports access and flexibility for patients and providers.

Fennec HEARS continues to be an important contributor to momentum in the quarter. Through ongoing operational refinements, we're seeing more patients enter the funnel. Specifically, a higher share of patients are progressing to therapy as reflected in encouraging conversion rates, which are hitting our benchmark of 80% for the first time. Once on treatment, we continue to see strong adherence trends of approximately 80%, which is a huge improvement from where we were 1 year ago today. With our larger sales footprint, we're able to make substantially more sales calls each day versus previous quarters.

Now as I mentioned before, this is a promotionally sensitive market where reach and frequency make an impact on our business. Early indicators of this success include HEARS patient record monthly enrollments in April. Demand through Fennec HEARS in April alone is more than 50% of the total Fennec HEARS demand for all of Q1. As a result, demand in Q2 is tracking to surpass Q1. Additionally, conversion rates remain above our target of 80% and key community and academic relationships are opening up to our message of CIO prevention. We remain focused on disciplined execution as we build on this momentum throughout the year.

And with that, I will now turn the call over to Robert for our financial review.

Thank you, Terry. Our press release contains details of our financial results for the first quarter of 2026, which can be viewed on the Investors and Media section of our website. Rather than read through all of those details, my comments today will focus on some key financial results.

For the first quarter of 2026, the company recorded net product sales of $15.1 million compared to $8.8 million in the first quarter of 2025, representing an increase of approximately 73% year-over-year compared with the first quarter of 2025. The first quarter demonstrated continued momentum in delivering PEDMARK to patients with net product sales up for the sixth consecutive quarter since new commercial leadership took over. We saw record new patient enrollments in the March quarter and April was our highest demand month ever.

On the OpEx side, which we define as R&D and SG&A, excluding stock-based compensation, it was approximately $14 million for the quarter, with a year-over-year increase of approximately $6 million. The increase was on the SG&A with expanded marketing investment and increased commercial headcount supporting PEDMARK growth. Important to note, we expect approximately $50 million in cash OpEx in 2026, with over 60% of those expenses expected in the first half of 2026.

Cash and cash equivalents were $40.1 million as of March 31, 2026. For the quarter, there was an increase of $3.3 million in cash and cash equivalents. The net increase in cash consisted of $2.3 million in operating cash flow and approximately $1 million in proceeds from option exercises. With regard to anticipated milestone payments from our partner, Norgine, we do not anticipate receiving the German milestone payment. We look forward to Norgine's expansion efforts in 2026 as they launch in multiple markets and the potential for the next milestone achievement by the end of 2026.

Importantly, we generated positive cash flow in the first quarter of 2026. As we grow the business, we anticipate select quarterly swings in the cash position based on collection cycles with customers and as such, expect the second quarter ending cash to be lower than the first quarter. However, we expect the third quarter cash to be positive and to grow the cash the remainder of the year in the second half of 2026.

We have tremendous leverage in the business with a predominantly fixed cost base. And as our revenue growth continues, we anticipate operating income to grow meaningfully in the quarters to come. Lastly, as stated in our press release, we anticipate that our cash, cash equivalents and investment securities as of March 31, 2026, combined with projected revenues from PEDMARK will be sufficient to fund our business based on our current operating plan.

Operator, with that, we are now ready to open the call for questions.

[Operator Instructions] And our first question will be coming from the line of Madison El-Saadi of B. Riley Securities.

Congrats on the quarter. It seems you gave some additional color this quarter on KPIs and performance. Maybe just help us break down really what drove the upside here, if this was predominantly new account adds in 1Q, if it was deepening utilization of your base accounts or maybe just productivity from sales force expansion that weren't fully onboarded as of March? And then afterwards, a follow-up.

Sure. This is Jeff. Thanks for the question. I appreciate it. And I'll let Terry comment on it a little bit. We talked about execution early on when I even first got here 1.5 years or so ago and going on. And we're starting to see it now. And one of the things that we saw with Project Ignite was the ability for us to be able to not only expand our reach but expand our frequency. And that's what we're seeing and one of the reasons why you're seeing such significant uptake, especially in a month like April. So we can go into a little bit more detail. Fennec HEARS is something that drives a lot of the growth here. And we see demand all throughout Q1 growing through Fennec HEARS. So that's also exciting for us. But I'll let Terry comment a little bit more on some of the growth.

Yes, for sure. Thank you for the question. What we're seeing is new starts in Q2 is balanced really between both academic and community. In that balanced approach, utilizing the additional folks that we have, our increased reach and frequency that Jeff mentioned, we're seeing that really present itself in academic and large community small community practices. We're seeing a nice growth in both AYA and pediatrics. So yes, we're encouraged by the balance of the year.

Yes, please. So it seems like you've had multiple inbound interests regarding these ISTs. I'm just wondering why you guys decided to go with the ISTs and the tumor types you did. And if we focus just on, say, the AYA adult testicular, what can this practically mean for the company? Is it more of a means of entrenching PEDMARK, increasing awareness? Or is it more in the context of TAM expansion? And I'm just curious if you can comment if you've seen any revenue come out of these IST institutions. It seems that would be a really tremendous kind of leading indicator of kind of the awareness gap.

Yes. Great question, again, and I'll touch on it first, and then I'll kick it over to Pierre, who's sitting here with us today. ISTs are something that are important for a couple of reasons. Number one is it establishes our position in the space. So one of the pushback you'll get from AYA physicians that talk is, let me see the data. Let me see some of the data that was generated in this population.

As you know, the trials that got PEDMARK approved were trials that were done with the Children's Oncology Group or in the pediatric space. So that's one of the reasons why we're excited about the testicular data that we're generating through the -- as well as some of the adult data down the road that are going to come from these. The second part is as you -- and I'll let Pierre talk a little bit more on how this happens inside the institutions, but we -- not only the physicians who are participating in these studies are using the product, but also physicians that are surrounding those physicians. And so we're seeing that expansion throughout the institution. And Pierre, maybe you can comment a little bit on that.

Sure. Sure, Jeff. Thanks for the question. So yes, as the medical team has the conversations around our 2 Phase III clinical trials, as Jeff alluded, those were obviously in the pediatric setting, there's a very natural conversation that happens with our physicians where they say, okay, now that I'm really understanding how cisplatin is causing this damage in the cochlea and how PEDMARK can potentially prevent that, they're coming to us with these new and very creative ISTs to test this out in AYA and adult patients. So we're -- as you know, from previous press releases, at least on the 3 ISTs that have already been announced, these are across tumor types, AYA setting, adult setting, localized tumors, metastatic tumors and all these ideas are coming directly from the KOLs. So we're very excited about all this interest.

I think your second question maybe was what do we do with this data? As you can imagine, as the data matures and our data set expands, we're certainly thinking about potential regulatory conversations, NCCN guideline submissions, so on and so forth. And I think the third point, just to cover what Jeff said, we absolutely see this very interesting trend of once an IST is activated in a given academic institution, there's so much training, so much conversation that needs to happen that now you have the pharmacists, the nurses, other oncologists all really on board with PEDMARK. So we begin to see a little bit of an uptick in commercial use in those institutions.

And our next question will come from the line of Chase Knickerbocker of Craig-Hallum.

Congrats on the nice quarter here. Could you maybe just share what percentage of your volume or just some kind of underlying demand metric was driven by the new rep hires over the last couple of quarters? And then how is that productivity trending in Q2? Really just trying to get to the extent of kind of what -- to what magnitude those new hires are playing a role in this sequential growth and then when they can be fully productive.

Yes. I'll give this over to Terry, but Chase, thanks for the question. It's a good one. And we -- the things we're seeing early on April is new patients or I mean, coming from new territories, which is exciting. So we see a healthy mix, both coming from new and existing prescribers. And I'm commenting now on the April numbers that we're seeing. These are established accounts, but which are becoming more comfortable with PEDMARK, but also we're seeing execution in accounts in new accounts and which is really exciting in places where we've never seen patients before. And we knew that once we expanded our reach and we expanded the frequency of this -- of the PEDMARK message, we were going to see continued adoption through these. Terry, maybe you can comment a little bit.

Yes. A couple of things. Jeff is exactly right. There's a significant number of our new territories that had prescriptions or patients that have come through between the time that our national meeting occurred through the end of April. To part of the point that you made, Chase, we actually began the hiring -- we began the decision of Project Ignite in Q4, and that kind of happened all the way through Q1. We trained everybody the first week of March, ended at our national meeting.

The effectiveness of the salespeople, the new salespeople really began, call it, on March 9. So as you know, and through years of experience, there's a ramp period of productivity for our sales team. We've talked about kind of the second half as we get these folks up and running and more productive. But early signs are good. There's a good balance between new accounts and existing accounts and growing patients and prescriptions inside of both of those. So we're encouraged that the fact that with the strengthened commercial footprint, we're going to drive reach and frequency, and we're excited that we've been able to deliver 6 consecutive quarters of strong performance.

Helpful. And maybe just a couple of smaller kind of details. Can you just speak to the kind of stability of the pediatric revenue? Just trying to get a sense for kind of underlying sequential AYA growth? And then can you just remind us what percentage of your business at this point, either from a demand or revenue perspective is flowing through Fennec HEARS?

Yes. I'll take a couple of the beginning points of this, then I'll give it over to Terry. But Chase, we see -- we're excited about the business and how it's growing. And so the Fennec HEARS right now, what we're seeing is in April alone, about 50% of our business and demand is going through Fennec HEARS. That's increasing every day. It increases as we get better implementation. It increases as physicians want to add more patients to this. And so we're continuing to see that.

Our pediatric business is growing. It's growing not at the pace, of course, of AYA, and we've said that before in the past. But pediatric business grows because we're getting now into institutions and places where we didn't have the ability to get to in the past with our pediatric business as well. So when a pharmacist, for example, becomes comfortable in an academic institution with the product, for example, in the AYA space, we're seeing now uptake in the pediatric space as well because of the ability to be comfortable with the product. Whether we get in there through AYA or pediatric for me, it doesn't really matter. It's the opportunity to be able to access these patients.

Yes. Jeff, I agree. Chase, we're growing in both pediatrics and AYA. Fennec HEARS, as Jeff mentioned, is roughly about 50%. It's important to note that even though we grow pediatrics and we're growing the AYA, PEDMARK is weight-based. And just -- and AYA represents 20-plus 1,000 patients with a high survival rate that take high dose cisplatin. So the AYA would be expected to outpace pediatrics even though the pediatric space is growing. So in both of those things, I think we're taking a balanced approach, which, again, kind of leads us to 6 quarters of strong growth.

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

This is Alex von Riesemann on for David. My first question is just how are you thinking about life cycle management for PEDMARK? And then secondly, what is your appetite for acquiring another asset?

Yes, it's a great question. And I'll touch on it on the life cycle, and I can turn to Pierre on this, but you're starting to see a little bit of that life cycle management come into play with the ISTs. We talk about 3 kind of groups of patients for our business. It's the pediatric and we talk about AYA, but there's also adult. When you think of where cisplatin is given, it's given across not only these 3 areas, but it's also given to both localized and metastatic.

And so now you're starting to see us start to grow the opportunity to develop data and expand it from a life cycle management standpoint into these other types of populations, the metastatic population, for example, can this product be given there and be effective in these patients in the adult patients, in the head and neck space. So you're starting to see all of this. And we have got more opportunities to be able to do that in other areas. Maybe, Pierre, you can touch on those.

Sure. That's exactly right, Jeff. So as these -- as I touched upon earlier, the ISTs are beginning to mature and we're seeing the data come through. So that obviously is going to open doors into metastatic indications. We've had a tremendous interest from multiple academic institutions putting forth very creative new ISTs in the head and neck space. So as I mentioned and alluded to before, we have our sights set on possible NCCN designation criteria for head and neck and cervical is also a very robust area in terms of interest. So as the data matures, that will define our strategy to expand, whether it's with regulatory meaningfulness or NCCN guidelines.

Yes. And as related to the second part of your question, looking at other products and bringing in other opportunities, we continue to be open to that. As you know now, we've expanded our commercial team significantly, we've expanded the organization and put resources in places now that you could start to expect a potential opportunity to be able to layer in some additional products, for example. So yes, we continue to be open to that, and that's something that we're looking at as well.

And our next question will be coming from the line of Ram Selvaraju of H.C. Wainwright.

This is Katie on for Ram. I guess I'm wondering what is the typical profile of a high-volume prescriber for PEDMARK at this point? Are those high-volume prescribers predominantly NCI cancer centers? Are they more community oncologists? And how many of those physicians are there in the U.S.

We talked about -- Terry mentioned -- that's a good question. I appreciate it. Terry mentioned that we're targeting about 5,400 folks with our new team expanded up from just a little bit over 1,000. So -- and those breakout, typically, we see the concentration of our uptake in both academic and community settings. So our strategy, as we get into this is designed to engage both academic centers and also community practices, and we're seeing a really good balance between both. Maybe, Terry, you can comment on that.

No, I think you're exactly right. With our greater reach and frequency, we're seeing new starts from academic and community settings. It's one of the important things that I may or may not have said, which is PEDMARK is a long -- it's a long play sometimes where -- it takes medical. It takes sales, it takes market access. It takes patient support services, lots of these cross-functional teams to kind of pull it through. So the need in academic is slightly different than the need in community. But -- and I've mentioned this before, we're taking a nice balanced approach and activating both sides of them. So thank you.

Excellent. If I could sneak in one more question. Do you guys have an idea of how many additional investigator-initiated trials you're going to have starting this year? And could any of those outcomes give you evidence to label expansion?

Sure. It's a good question. We get -- as soon as we put out your first press release, you start to see significant interest come in, right? Because we see that we have -- our doors are open for partnerships. So let me let Pierre comment on that a little bit. But again, the doors -- we -- there's a limit to how many we're going to do. I can tell you that. But there are some really interesting ones that we've been talking about. Pierre, maybe you can comment on that.

Sure, sure. I'm smiling a little bit at the question. I mean the -- we're really excited, very encouraged. When you have the amount of interest that we've had from the top academic institutions for new IPs, it's always a great sign. In terms of how many are we expecting to see, I can't comment on that, but there will hopefully be more press releases here soon. I think the point, though, that I want to make is these are not -- I'll use the word haphazard. We have a very strong strategy as to which ones we're approving and which ones we are not. And so ultimately, there will be efforts to combine data, et cetera, do some pooled analyses with very specific purposes, again, as I mentioned, for regulatory enabling conversations.

Next question will be coming from the line of Sudan Loganathan of Stephens.

We appreciate the updates and the great progress. My first question, I wanted to ask what your internal pipeline looks like to target new patient populations also treated with platinum-based chemotherapies such as ovarian cancer, bladder cancer, colorectal cancer and even non-small cell or small cell lung cancers. I believe those areas will start getting into more into the AYA population. I'm curious to see what you view out of those maybe or others to be the next low-hanging fruit.

Sure. Thanks. It's a good question. We go where cisplatin is given, right? And we know that there's certain tumor types that are obviously a target for us in that space of where these patients receive therapy with cisplatin. I'll let Pierre comment on the potential new ones. But we see as an opportunity, obviously, testicular because cisplatin has done so -- it's the gold standard. It's something that there's a lot of cisplatin that's given and we see a big impact of CIO in that space.

But there are others that physicians have come to us throughout our time frame as we expand because they're using a lot of cisplatin in cervical and head and neck and other places. And so we see that expansion in places like that. But maybe, Pierre, you can talk about why we see that.

Yes. So as we've covered before, there's a strong foothold, if you will, interest that has come through for head and neck testicular cervical. We are absolutely having a lot of conversations in those additional areas that you mentioned as well, bladder as well as lung. And I think it's basically what Jeff said, the mechanism by which cisplatin, a, combats the tumor, but then also defeats and kills these very sensitive cochlear hair cells is the same across all these tumors. So wherever cisplatin goes, PEDMARK absolutely has a strong potential of helping those patients. So yes, you're absolutely right, right? It's head and neck, cervical, testicular, lung, bladder, and there's probably a few more that we could rattle off here. Those are all absolutely big targets for PEDMARK.

Great. And secondly, if I can squeeze one more in. Could we give more details on how the PEDMARQSI launches are going? What are the primary sticking points? And when do you anticipate revenues from there maybe to start actually moving the needle for the business?

Yes. We're enthusiastic about what we're seeing with Norgine. It's -- this is the year we'll see significant growth in Norgine throughout their territories and we're starting to see, obviously, many countries. As Robert said, maybe you can comment a little bit on some of the growth that we're seeing through Fennec HEARS, I mean, through Norgine.

Yes. PEDMARQSI for 2026 will be launched in multiple markets, almost double-digit type markets. So this is the year where the foundation gets laid. I think an important point there is not only our royalties, which start in the mid-teens as they grow those sales, but also the milestones. And if you think of the over $200 million in milestones, at least half of those are tied purely to achieving certain sales. So we look forward to giving you updates, but this -- 2026 is the year where we see the ramp starting.

And congrats. Great quarter.

I would now like to turn the call back to Jeff for closing remarks.

Perfect. Well, thanks, and great questions, and I really appreciate everybody here attending today. So in closing, we believe our first quarter performance reflects meaningful momentum across the business and reinforces our confidence in 2026 as an important year for Fennec. With strong execution underway in Q2 and multiple catalysts ahead, we remain focused on delivering sustained value. So thank you all again for your continued interest and support. We appreciate it. Take care.

And this concludes today's conference. Thank you for your participation. You may now disconnect.

Good morning, ladies and gentlemen. Welcome to Fennec Pharmaceuticals' Fourth Quarter and Full Year 2025 Earnings and Corporate Update Conference Call. [Operator Instructions]. As a reminder, today's conference call is being recorded.

Now I'd like to turn the conference over to Fennec Chief Financial Officer, Robert Andrade.

Thank you, operator, and good morning, everyone. Thank you for joining us today. We are pleased to host Fennec Pharmaceuticals' Fourth Quarter and Full Year 2025 Earnings Conference Call during which we will review our financial results as well as provide a general business update. Towards the end of the call, we will conduct a Q&A session, hosted by myself starting with frequent questions that the company received from investors, followed by our traditional open Q&A session.

Joining me from Fennec this morning is our Chief Executive Officer and Board member, Jeff Hackman. I am also pleased to welcome our Chief Medical Officer, Dr. Pierre Saada. Pierre is an accomplished industry executive with proven success leading global medical teams and oncology launches at companies such as Onyx Pharmaceuticals, Karyopharm Therapeutics, Oncopeptides and CTI BioPharma.

Dr. Sayad is a graduate of the School of Medicine of Loma Linda University as well as a Harvard Business School alone. Since joining Fennec in the fourth quarter of 2024, and Pierre has been instrumental in advancing our medical strategy and clinical evidence strategy, expanding engagement with leading institutions and key opinion leaders and strengthening the independent data foundation supporting PEDMARK.

Later in the call, Pierre will speak to the substantial progress being made on the medical front and the importance of the medical team in the education process of CIO and PEDMARK. Before we begin, I would like to remind you that during this call, the company will be making forward-looking statements that are subject to risks and uncertainties that may cause actual results to differ from the results discussed in the forward-looking statements. References to these risks and uncertainties are made in today's press release and disclosed in detail in the company's periodic and current event filings with the U.S. SEC.

In addition, any forward-looking statements made on this call represent our views only as of today and should not be relied upon as representing our views as of any subsequent date. We specifically disclaim any obligation to update or revise any forward-looking statements.

This conference call is being recorded for audio rebroadcast on Fennec website, www.fennecpharma.com, where it will be available for the next 30 days. And with that, I'll turn the call over to our CEO, Jeff Hackman.

Thank you, Robert. Good morning, everyone. Thanks for joining us today on a very special earnings call. 2025 was a transformational year for Fennec. We delivered record net product sales of $44.6 million compared to $29.6 million in 2024. But most importantly, this growth was really driven by quarter-over-quarter expansion with our active patients as well as new and existing accounts. This reinforces the durability and demand and the effectiveness of our overall market development strategies.

In the fourth quarter, given the positive momentum we saw in 2025, we made the strategic decision to further enhance our execution by increasing our customer-facing team and to try to achieve a much greater reach and frequency with our customers, so we can ultimately help more cancer patients protect their hearing. We expanded our capabilities to include new territories and high-prescribing targets in the AYA or adolescent and young adult market.

We strengthened the company's financial health during the year with disciplined operating decisions and efficiency measures, including the closing of public offerings, raising over $42 million in net proceeds, which resulted in a full redemption of our debt. We were intentional on our capital allocation, focused on high-impact initiatives and continue to enhance our operating leverage as our business scales. This balanced approach in investing in growth while maintaining financial rigor has positioned us well for long-term value creation with the strongest balance sheet right now in the company's history.

Our full service patient support program, I've mentioned before in the past, Fennec HEARS, which is designed to simplify access and support continuity of care by guiding patients through coverage, reimbursement and providing free product for eligible individuals as well as coordinating a nurse-led administration and at-home infusion services achieved a record performance in the fourth quarter.

The program reached all-time highs in patient enrollments, prescribed and infused vials, active patients and conversion rates. In fact, conversion rates were up 70% in Q4 compared to 50% in the first quarter. These results reflect not only patient need, but the exceptional execution of our field organization and our operational infrastructure that we have built to ensure appropriate and efficient access for our patients.

Now as we continue to increase the awareness and use of PEDMARK through our sales activities, our marketing team has been busy as well, expanding focus to activate young adult testicular patients, for example, on a broader scale. In the coming quarter, we're excited to launch an initiative around the Ind500 race in May in close partnership with a testicular cancer advocacy group. Following that, we will also have a significant presence this year at the ASCO meeting in Chicago. We look forward to providing more updates on these initiatives and others in months ahead.

Beyond commercial performance and our activities, we also made significant progress advancing our clinical evidence strategy. Shortly, you're going to hear from Pierre. He'll provide you much more details on the progress and how we are moving these forward in our medical affairs initiatives.

Finally, top line results from our investigator-initiated Phase II/III, we call it STS-JO1 clinical trial for PEDMARK in Japan is progressing well. This, as you guys know, this is -- we believe it's still early, but this clinical milestone is very important for Fennec and reinforces the broader applicability of PEDMARK and the opportunity to expand our impact globally, partnering and registering this product in Japan and potentially broader in Asia.

As a reminder, PEDMARK is currently approved for pediatric patients 1 month of age and older with localized non-metastatic solid tumors and is also recognized by the National Comprehensive Cancer Network or the NCCN with a 2A recommendation for use in AYA patients.

Now I'd like to just take a moment to thank our dedicated employees for their focus this past year. Their resilience and their belief in our mission, it's been instrumental in driving our performance. We've built a very strong organization with strong revenue growth and notable milestone achievements during the quarter and the year further will validate our strategic plans and objectives and market development strategies and importantly, Fennec's ability to execute our plans.

Further, I'm proud of our executive team and each of their respective operating functions at Fennec. Overall, we have strong performance and strong foundation that we built in 2025, and that is going to propel us and propel Fennec into the next chapter of this organization. One is going to -- and this next chapter is going to be defined, as I mentioned, with execution, global expansion and sustained growth. So with that, let me turn it over to Pierre.

Thank you, Jeff, and good morning, everyone. I'm pleased to be joining today's call to share an update on the significant progress we've made across our evidence generation and medical initiatives. Over the past year, we have strengthened our medical affairs team significantly, building a high-performing organization capable of delivering on our strategic priorities. We expanded capabilities across clinical field and real-world evidence functions ensuring that we can engage effectively with key opinion leaders in both academic and community settings while supporting new evidence generation initiatives in the U.S. and globally.

This robust foundation positions us to execute efficiently and meaningfully in 2026 and beyond. Our 2025 efforts were focused on 3 priorities. First, key opinion leader development, engaging with influential clinicians to deepen understanding of our product's clinical value and real-world applicability. Second, institutional engagements partnering with leading academic institutions to advanced independent research, generate new clinical data and expand insights across additional tumor types and patient populations. And finally, improving patient and clinician experiences, driving key customer enhancements, such as the revamp of our Fennec HEARS program, designed to simplify access, support adoption and ensure a positive experience for both the patients as well as the clinicians.

These activities created meaningful traction in 2025 and into 2026 with multiple studies underway and strong collaborations forming with both academic and community oncology [indiscernible]. The insights we have gained from KOLs during the year are highly encouraging. Clinicians report increasing confidence in our products, particularly in better understanding the mechanism of action of cisplatin and then recognizing the feasibility and ease of incorporating PEDMARK into routine practice without compromising cisplatin's antitumor activity.

These discussions are not only reinforcing clinical confidence, but also supporting broader adoption and integration into guidelines and standards of care. For example, last month, Fennec announced that new data supporting the potential use of PEDMARK in adults with head and neck cancers were presented at the 2026 Multidisciplinary Head and Neck Cancer Symposium that's the NCS meeting. It is worth noting that these are the first new data supporting the potential use of PEDMARK since the pivotal clinical program.

The findings from the multi-institutional retrospective review of 15 adults with head and neck cancers, show that PEDMARK could be safely given at 6 hours after cisplatin dosing and what's easy to incorporate into the real-world care plan. This strict post cisplatin timing is a validated approach intended to preserve cisplatin antitumor activity and no disruption to curative intent cisplatin-based treatment delivery was observed [indiscernible].

These new findings are critical to demonstrating the feasibility, scalability and long-term value of PEDMARK beyond those studied in our pivotal clinical program. These findings also helped to strengthen the case for broader clinical adoption and a sizable patient population at risk for permanent hearing loss.

Additionally, as Jeff mentioned, at the start of 2025, we outlined a very focused strategy to expand and deepen the clinical evidence supporting our product via institution-led initiatives. Our objectives were clear. First, generate new data across additional tumor types and patient populations; second, validate and expand the product's real-world clinical value. Third, address unmet need in vulnerable groups such as AYA and adult patients. Next, strengthen guidelines and practice adoption through independent evidence. And then finally, deepen our collaboration with influential institutions shaping oncology standards of care.

I am proud to report that we have made meaningful progress across each of these priorities. Within the last 3 months, we have announced the initiation of 2 new studies with respected academic and community oncology centers. The first is with City of Hope, 1 of the largest and most advanced cancer research and treatment organizations in the United States. City of Hope is evaluating PEDMARK for the prevention of cisplatin-induced auto toxicities of CIO in adult men with Stage II/III metastatic particular germ cell tumors. And our intention is to not stop here. Cisplatin has truly transformed outcome for patients with germ cell tumors, turning what was once a highly fatal disease into one of oncology's true success stories. However, as many as 4 out of 5 survivors are left with permanent hearings loss, which impacts the quality of life long after the treatment ends. And we are pleased to see that centers like City of Hope recognize that oncological care needs to focus on both the survival as well as the quality of life.

The second study we announced earlier this month is with Tampa General Hospital Cancer Institute, that's TGH. TGH is initiating a study evaluating the real-world clinical utility at PEDMARK and reducing the risk of ototoxicity in AYA and adult cancer patients receiving cisplatin-based treatment. This evaluation will examine real-world clinical data and audiology monitoring that will help to reinforce the message that tumor efficacy is not compromised by the use of PEDMARK. Over time, this expanding data set will help to strengthen physician confidence and support the broader clinical adoption.

Additional investigator-initiated studies supporting the use of PEDMARK have been submitted to Fennec and are currently under review. We continue to be very encouraged by the robust conversations and engagement we've had with key opinion leaders at some of the nation's leading oncology centers and look forward to sharing additional updates on evidence generation in the very near future.

In summary, our medical efforts in 2025 laid a strong foundation for future growth through expanded evidence generation and meaningful KOL development in the academic setting. It's a combination of a robust organization focused priorities and positive KOL feedback ensures that we are well positioned to continue driving clinical confidence and impact in 2026.

With that, I will turn the call over to Robert to take us through the financial highlights.

Thank you, Pierre, and a very good thank you to our entire medical team for their energy and strong momentum going into 2026.

Now to the financials. Our press release contains details of our financial results for the fourth quarter and full year 2025, which can be viewed on the Investors and Media section of our website. My comments today will focus on some key financial results.

For the fourth quarter of 2025, the company recorded a net product sales of $13.8 million compared to $7.9 million in the comparable period in 2024, representing an increase of approximately 75%. Fourth quarter demonstrated continued momentum in delivering PEDMARK to patients with net product sales up for the fifth consecutive quarter, since Jeff joined as CEO; and our new leadership team of stewardship.

For the full fiscal year 2025, the company recorded $44.6 million in net product sales compared to $29.6 million in 2024, representing an increase of approximately 50%. The increase in net product sales is attributable to growth across both new and existing accounts with notable success and progress in conversion and adherence of PEDMARK patients.

The company recorded $6.1 million in selling and marketing expenses in the fourth quarter of '25 compared to $3.9 million in the comparable period in '24. The increase in selling and marketing expenses in the quarter is largely related to increased payroll and additional marketing expenses as we focus on expanding our commercial team and augmenting our outreach to community oncology expenses and the adolescent and young adult operations.

For the fiscal year '25, the company recorded $18.6 million in selling and marketing compared to $18.4 million in fiscal year '24. For the full fiscal year, selling and marketing expenses was in line largely as increased payroll and additional marketing expenses in the comparable period were offset by the elimination of European expenses after the announcement of the [indiscernible] transaction. in March of 2024.

On the G&A front, the company recorded $8.9 million in the fourth quarter of 2025 compared to $4.2 million in the comparable quarter of '24. For the fiscal year 2020, the company recorded $28.8 million in G&A compared to $23.1 million in '24. G&A expenses across both periods, quarters and comparable fiscal years increased with higher intellectual property and legal expenses, increased payroll expenses as head count increase and increased noncash expenses associated with equity-based remuneration.

Noncash stock-based compensation increased about $2 million year-over-year. Cash and cash equivalents were $36.8 million as of December 31, 2025. The net increase in cash was primarily due to the approximately $42 million in net proceeds from equity offering and cash selected for net product sales offset by operating expenses and $21.8 million debt paydown in November of '25. As Jeff mentioned, the company has 0 in debt outstanding and has the strongest balance sheet and the history of Fennec.

Importantly, we anticipate generating positive cash flow in the first quarter of 2026 as the timing of receivable collections impacted the Q4 cash flows, but on the [indiscernible], we collected the receivables early in the first quarter of 2026 that will benefit our cash position in Q1 of 2026.

Lastly, and the major milestone for Fennec, we are pleased to have announced -- last week, the settlement of patent litigation regarding PEDMARK in the U.S. Under the terms of the settlement, Cipla will not enter the market with its generic sodium thiosulphate product until September 1, 2033 or earlier under select [indiscernible]. We believe this settlement will save multiple millions of dollars in annual G&A that will largely be redeployed to help contribute to the expansion of the commercial team, and importantly, provide market exclusivity for many years as we continue to establish PEDMARK as standard of care for patients to be administered cisplatin.

With that, we will now commence with a Q&A format by addressing top questions that we most frequently received from investors within the categories of medical, financial and commercial.

Starting with medical here. Number one, what is the biggest challenge or pushback from physicians or institutions when it comes to PEDMARK, such as the notion that it interferes with cisplatin treatment.

Yes. Thank you for the question, Robert. It's an understandable concern, and it's an important question to address. The primary historical question from oncologists has been whether sodium biosulfate could reduce the cisplatin antitumor activity. And this concern is understandable given the importance of maintaining such high cure rates in cancers versus cisplatin is used. And I'll show 2 specific explanations.

First, what has been encouraging is that long-term follow-up from both the COG and SIOPEL 6 trials continues to show preservation of survival outcomes while significantly reducing the risk of cisplatin-induced hearing loss. That evidence base has been critical in shifting physician confidence.

In the COG ACCL0431 study, long-term follow-up approaching approximately 8 years has shown no difference in overall survival between the PEDMARK plus cisplatin arm, and the cisplatin alone. Similarly, the CIHL study in hepatoblastoma has demonstrated consistent overall survival outcomes with follow-up extending beyond approximately 5 years while still showing a substantial reduction in hearing loss.

So what this means is, importantly, if PEDMARK were meaningfully interfering with cisplatin antitumor activity, we would expect to see a divergence in those long-term survival curves, yet, instead, the curves remain essentially overlapping, which provides strong clinical reassurance that the anticancer efficacy of cisplatin is fully preserved.

Second, and aside from this long-term durability data, as physicians become more familiar with the pharmacology and the [indiscernible] delayed administration strategy, it's the mechanistic rationale, which becomes clear. Cisplatin has already entered tumor cells and has already formed the DNA at ex before PEDMARK is administered. We are seeing this discussion move away from skepticism and toward implementation logistics such as the institutional protocol and pharmacy workflow.

As awareness grows, many institutions are recognizing that hearing loss is a lifelong type of city and are becoming more proactive about production.

Thank you, Peter. Second question. what is Fennec's regulatory strategy for the AYA population? And are you speaking with the FDA regarding the revised or supplemental indications or working with NCCN regarding stronger guidelines placement?

Yes, Robert. As I mentioned earlier, we're building a robust evidence generation pipeline through recent data from our study in Japan, new real-world data supporting the potential use of PEDMARK in adults with head and neck cancers, 2 ISPs already underway and other ISPs in additional tumor types and patient populations, including AYA cancer have been submitted to Fennec and are currently under review.

We are focused on expanding the clinical evidence base that demonstrates consistent protection against cisplatin-induced ototoxicity across additional tumor types and patient population. So stay tuned for more updates over the coming months.

In parallel, from a regulatory standpoint, we maintain ongoing dialogue with regulatory authorities regarding the potential pathways for label expansion as the data package matures. From a clinical practice perspective, guideline recognition is a very important milestone. As the evidence grows across different disease settings that positions PEDMARK more strongly for future guideline inclusion for strengthened recommendations.

The AYA population represents a meaningful opportunity because these patients frequently receive cisplatin-based regimens and face decades of potential hearing impairment if toxicity occurs. Our strategy is evidence first. Once the clinical and mechanistic data are sufficiently robust, we have a plan and look forward to regulatory and guideline pathways naturally becoming more achievable.

Thank you, Pierre. Moving to financial. Question one, can you provide an estimate on cash operating expenses for 2026 versus 2025 in light of the commercial expansion and other awareness initiatives?

With the growth of our commercial team territories and the strategic marketing initiatives to drive further awareness, specifically in AYA, we anticipate cash operating expenses to grow from approximately $35 million in 2025 to approximately $50 million in 2026. The increase in spending is across both commercial and medical. On the commercial front, we have increased head count, expanded awareness initiatives, a few of which is here today and focus on execution.

On the medical front, we expect additional ISTs commencing and enrolling, expanded advocacy initiatives and a focus on positioning Fennec for additional guideline recognition and expansion. Further, from a cash EPS perspective, we anticipate a clean P&L in 2026, with a similar gross to net drop down of approximately 85% of gross sales to net sales, COGS in the mid-single digits and noncash stock compensation in line with 2025.

Important to note, the increase in spending is focused with rigor and accountability with specific [indiscernible] to grow PEDMARK utilization and net product sales. We increased spending and expanded the customer-facing teams with the expectation that they will be making a material contribution by the second half of 2026.

We remain intent on growing cash flow from operations in '26, and we can expect the same cadence of spending with over 60% of total cash operating expenses to be spent in the first half of the calendar year.

Question two. Can you provide an update on the Norgine partnership and ex U.S. progress?

After our Norgine deal in March 2024, PEDMARQSI, the brand name for PEDMARK in Europe, was launched in the U.K. and Germany, just last year in '25 and was just approved in Switzerland last week. Importantly, Norgine is planning 8 to 10 launches in 2026, including some major EU countries in addition to the U.K. and Germany.

Regarding pricing, the U.K. price was set in 2025 at approximately GBP 8,000. And the final pricing in Germany we expect to be able to share more by the middle of this year and give you an update related to the potential milestones attached to that pricing. The key takeaway here is that Norgine is just getting started. We expect PEDMARQSI momentum to build meaningfully throughout 2026 as additional countries get launched and commercial activities expand and royalty contributions and related potential milestones impact Fennec financials will really start to hit us in the second half of 2026.

Final financial question. When will you provide revenue or EBITDA guidance in 2026?

As a reminder, every additional 100 patients per year on PEDMARK has the potential to benefit Fennec Financials by approximately $13 million. That's 100 patients per year with an approximate addressable market in the AYA market segment alone of greater than 20,000 patients annually. The opportunity is significant as we ramp up our commercial teams presence in the field here in the first half of 2026.

As the year progresses, we intend to evaluate the potential for issuing both revenue and EBITDA guidance as we monitor the impact of our growth initiatives. In addition, directionally in terms of EBITDA and free cash flow, every additional 100 patients, as mentioned, can add $30 million in net revenue, but with our fixed cost base has the potential to add an estimated $0.70 per share of free cash flow or cash EPS.

Moving on to commercial. Yes. Jeff, question one. You've announced the recent field force expansion in Q1. Can you elaborate on these hires and how we should think about the impact of the sales?

Sure. Thanks, Robert. The expansion that we announced in the first quarter here was a very targeted step for our growth. These are really focused on building our territory managers and we've seen the productivity of our current territory managers to be significant, but limited in their reach and frequency. So our territory managers with our accounts that they have focused on high Tier 1 accounts and we're going to continue to see that with the increase of these folks that we brought in, so will not only increase our reach, but we'll increase our frequency.

These additional hires are going to be focused on expanding coverage in regions where demand and account density support incremental investment. We believe this approach will allow us to further penetrate these Tier 1 accounts while also supporting activation of high-potential new centers. Given the productivity that we've seen from our existing territory managers in 2025, we're confident that these hires will contribute new and continued growth and ramp up through 2026 throughout the year and in the future.

Thank you, Jeff. Question two, you highlighted [indiscernible] enrollments and conversion rates for the quarter. To what extent is that program driving commercial demand versus addressing access barriers and how should we think about an impact on revenues going forward?

Thanks, Robert. The primary purpose of our Fennec HEARS program is to address access barriers and to ensure that appropriate patients are able to start and complete their therapy rather than just to create demand. What we're seeing in the data is that this revamped program is functioning exactly as we intended it by helping physicians and patients navigate reimbursement and affordability challenges while also simplifying the overall access experience for PEDMARK.

The record enrollments as well as prescribed and infused vials in active AYA patients are growing and they reflect both strong operational execution as well as growing familiarity with our providers and how to utilize this program efficiently. Most importantly, though, the demand for the product continues to originate from clinical adoption and physician decision-making.

The patient assistance program supports that demand by removing friction from the access process as well as helping convert appropriate prescriptions into treated patients. From a revenue standpoint, we view that this program is an important enabler for our sustained growth going forward. By improving this patient and clinician experience and ensuring conversion and prescribe files to infused vials that helps us capture appropriate utilization, which might otherwise be delayed or even lost due to administrative and financial barriers.

Thank you, Jeff. And operator, with that, we'll open it up for questions.

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

This is Alex on for David. We wanted to dive more into the germ cell tumor and to secular cancer group of patients. Can you maybe refresh us on what you're seeing in the field from advocacy groups and the new field force? And how is penetration in this segment? And then also, are you seeing strong uptake in academic centers or community oncology practices or both? And what's the mix between pediatric patients and older segments at present?

Yes. Let me take the first part just real quickly because I think it relates to some -- on the commercial side, and then I'll hand it over to Pierre. It's a good question. Germ cell tumors continue to be the largest opportunity that we see for PEDMARK. And while the efficacy of cisplatin is fantastic in a lot of these tumors, what we see is a significant amount of ototoxicity in these patients. And so we continue to focus ourselves there.

We are partnering with advocacy groups. We have some initiatives throughout this year, and I mentioned a few in our call. But I think driving kind of a two-pronged approach, we have to educate our physicians on the importance of PEDMARK, but we also have to educate patients that they -- and by partnering with advocacy groups, this gives us an opportunity to be able to get that education out to our patients.

The second part of that, I'll give it over to Pierre to answer.

Thank you, Jeff, and thank you for the question. Certainly, we have seen a very substantial, I think, interest, if you will, from both the community as well as the academic settings in terms of driving PEDMARK research and where this is coming from is maybe twofold. So on the one hand, frankly, it's our substantial medical team. So we had in the field, a group of trained MDs, PhDs, Pharm-Ds, true experts, if you will, engaging daily with top KOLs and academic institutions as well as very important HCPs in the community setting.

They are driving very deep and robust conversations. I think the second thing is how these conversations are actually unfolding. These conversations go extremely down deep into the mechanistic rationale, first of cisplatin. How does cisplatin actually cause the damage to the [ hair ] cells inside the cochlea. We are really able to demonstrate through data, through science, what's happening with [indiscernible] and then on the backside of that is explaining the molecular mechanisms, the biochemistry of how PEDMARK prevents the auto toxicity.

So you combine the talent of the team with these very mechanistic biochemistry, organic chemistry types of discussions, and yes, we are absolutely seeing an increase in KOL interest and I would say, enthusiasm for working with PEDMARK.

Our next question coming from the line of Madison El-Saadi with B. Riley Securities.

Maybe if we could double-click on the growth of the number of treated patients in making certain assumptions about pediatric revenue. It looks like the AYA patient treated count rose materially in 4Q, at least by, say, 20% versus 3Q. Is that a fair assessment? And do you expect these to increase in the coming quarters? And then relatedly, are you seeing an increase in high frequency prescribers?

Yes. We'll continue to see that trend grow. -- you see a shift in our focus in our organization towards the AYA market. Obviously, it's much larger. I think Robert has mentioned on numerous occasions. It's 10x the size of the pediatric market. So where we're seeing the significant growth is in our AYA patients. That's where we'll focus. And that's where our efforts have been. That doesn't mean that you walk away from these pediatric institutions and the ability to be able to grow it there. We have some great relationships, and we continue those.

In the institutions, you see it mixed, both in the academic and community settings for AYA. We see academic centers in certain areas of the country play a much more important role, but we also are seeing, and we've mentioned in the past that PEDMARK was put on formulary in a large community practice, oncology community practice, and we're going to continue to expand, and we have initiatives working with some very large community practices throughout the country. So stay tuned. We'd love to announce more in the future about how we grow our business in the community setting.

And just to dive a little deeper, Mad, and then question on your question in terms of some key prescribers what we saw in Q4, and we expect to continue is a nice mix of both existing accounts and new accounts. And in particular, what got us very enthusiastic is the existing accounts growth. So not only growth in the amount of patients but growth in the amount of vials of PEDMARK administered. And so that's something that we're watching closely to keep that balanced mix between both existing and new.

Our next question coming from the line from Raghuram Selvaraju with HC Wainwright.

Congratulations on all the 2025 progress. The first question is from an international commercial perspective, and there are 2 parts. First, when would you during 2026 to start to see initial revenue coming from the Norgine partnership? And with respect to Japan, can you comment on when you would anticipate having a potential partner, a local regional distributor in place and how that might relate to the time line for potential approval and market entry?

And then lastly, I was wondering if you could comment on the current overall situation vis-a-vis generic filers in the wake of the Cipla settlement. Do you anticipate pretty much everything else to more or less fall in line with that settlement? To what extent is their remaining litigation pending? How many other generic filers do you expect? And any other information on that topic that you could provide that might be germain.

Sure, Rob. I think I'll start with taking all 3. On the Norgine front, as I mentioned, there are a number of launches happening this year. And also really once we get the -- once Norgine gets the pricing in Germany, you're going to see Germany starts to take off. So we anticipate a material contribution to Fennec financials in the second half. of 2026 from Norgine.

On Japan, front and center, as Pierre mentioned, we're really excited about the results that we announced in Q4, all very consistent with what we know that it protects your hearing and doesn't impact the efficacy of cisplatin. Those conversations and dialogues are ongoing. It's in our best interest to get a deal done sooner rather than later. We want to be with a partner similar to what we have with Norgine in Europe -- in Japan, so we can get the regulatory process kicked off. And we have a lot of enthusiasm, not only from strategic but from the investigators themselves in Japan to get PEDMARK approved there.

Lastly, and thank you for the question on the settlement. It was many years in the work, lots of dollars spent. So we are very excited to have that behind us. We have no other outstanding litigations currently at this time. I think you're very familiar with the generic and the settlement process generally, it's one and the first one that you settle with, if it's two, it means that you have an enormous market or a sizable market. So to a certain extent, that's a good problem to have. But nevertheless, we are very excited to have resolved our only outstanding litigation with Cipla and look forward to establishing PEDMARK as the standard of care well into the 30s and go thereafter. So thank you, Ram.

Our next question coming from the line of [indiscernible].

I wanted to get your thoughts maybe -- I think it would be helpful kind of however you guys kind of break it out internally, but potentially a number of kind of unique way AYA accounts or prescribers. And then you kind of mentioned those accounts that are writing more vials in Q4 over Q3? Maybe just -- is that the exception is that the rule kind of maybe kind of elucidate that further as far as kind of how many repeat prescribers you're seeing in that AAA population?

Thanks for the question. We're seeing -- first off, let me take the last part of that question. One of the areas that is really sticky for us now and what we're seeing is prescribers prescribing again, right, and multiple times. And I think that's probably the biggest impact that you see on our growth if these prescribers now being comfortable with the regimen, being comfortable with using Fennec HEARS with using nurses coming into the home of the patient being comfortable with getting reimbursement. One of the things I know you're interested in also is can the product get reimbursed in the AYA space. And the 3 top plans in the country, we're seeing upwards of 95% to 100% reimbursement rates for the product. So that's not limiting us either.

All of those are factors that allow our physicians now to be much more comfortable with the product and use it multiple times. But one of the reasons why we wanted to increase the size of our commercial footprint was to get to more customers. There was just a limit to who we could call on with the size of our commercial team. We've now expanded that reach significantly. I believe that the size of our team now is good enough to get us to the future of where we need to go, especially with the expansion of the number of calls that we're seeing already with these folks in the field. And so that growth is going to be evident, and you'll see that really quickly start here in 2026.

So while we don't kind of get numbers of new accounts, as you know, but the area -- the breakdown of both new existing accounts are very balanced right now. It's probably like what we'd like to see in the field is kind of a balance of both. I don't want to see physicians walking away from using the product because they didn't have a good experience, but we also want to see us reaching out to new customers as well. So it's a very balanced approach.

Maybe just being most of the way through Q1 here. You kind of called out that kind of per patient revenue is pretty significant that does introduce a little bit of lumpiness, right? And so as we go into Q1, most of the way through the quarter, I think it would be helpful just to get some kind of goalpost or thoughts as far as kind of current trends? I mean you grew about 11% sequentially in Q4. Maybe just a goal post there would be -- do you expect that to accelerate in Q1? Or is there some seasonality in Q1 that we should be thinking about for the business?

Well, I'll let Robert comment on some of the numbers. But Chase, we've grown this business 5 straight quarters. My plan is not to slow down here. Robert, if you want to comment on.

Yes, I'll just -- similar to Jeff's comments, we have a strong momentum into 2026. Importantly, we did add significant amount of FTEs and commercial hires and as well as medical hires. They don't contribute day 1. But as mentioned in my prepared remarks, we anticipate that material, call it, step up in the back half of 2026. So we're not going to stop here by any means in Q1 and Q2, but the material contribution that we've done from this expansion we believe is going to really start to impact our financials starting in Q3.

Our next question is coming from the line up [indiscernible].

Congrats on the great year and quarter. My first question, I just wanted to ask how are you thinking about the business development going forward, particularly in terms of priority and maybe potential areas of focus? And then the second one I have kind of touched on this a little bit on the prepared questions. But can you elaborate on how institutional led research is expected to impact Fennec in both the near and long term over the long term?

Yes. The first question to Dan was on business development. And I'll let Jeff add to here. But as you know, our opportunity in PEDMARK is very, very large, 20,000 patients in the AYA alone with the opportunities that Pierre spoke to in potentially expanding both the initiatives into metastatic and into additional populations. So that being understood as we expand our sales team, there's always the opportunity to evaluate potentially late-stage assets or commercial assets. But with our team in place, we are very enthusiastic just about the opportunity to invest in ourselves and this opportunity [indiscernible]. Jeff, do you want to add anything?

I'll just add, yes, I mean, now we're -- the scale that we've added now and the expertise and the I've talked about this, Sudanefore, is now we've created and we're showing significant execution, 5 straight quarters in a row here. So this organization now has shown that it can deliver and execute on its strategies. And so yes, now it opens up some doors. So it's a good question.

The second part of your question, I'll answer a little bit of it, and then I'll let Pierre jump in. But the growth in our partnerships in these medical institutions are kind of twofold, right? So you can start to think about the relationships that we build and the importance of these studies and the data that we're going to get from these studies, but having a partnership, for example, with City of Hope, as Pierre discussed earlier, is essential for the entire organization and our relationship with City of Hope, not just those physicians doing the study. And do you want to expand on that because a little bit.

Sure, sure. Thank you for the question. As Jeff is commenting, absolutely, you got City of Hope critical academic centers that are going to help us drive our understanding into new patient populations. As previously mentioned, adults, metastatic disease, et cetera. And there's many more ISTs that we are currently reviewing. So stay tuned for some more press releases here hopefully very, very soon. All that to say, is that as new data is coming in, that defines our regulatory strategy.

Our immediate priority is expanding the clinical evidence that demonstrates this consistent protection against cisplatin is ototoxicity, yet additional tumor types and additional patient populations will allow us to drive these regulatory conversations. So in terms of expanded labels, perhaps new guidelines, new relationships with NCCN, the new data coming in will help define that entire guide.

So in closing I -- yes, thank you for the questions, everyone. I think we'll close it here. And I just want a few comments here at the end for me on this. And I -- 2025 was a record-setting year for the company. It's we've come an incredible and we've overcome incredible things this past year in 2025, but we're not stopping here. We're set up to strengthen our commercial execution going forward. We see our medical engagement. We've expanded our global reach.

We're now seeing the impact of this focus and this disciplined execution focus in this organization. We've built real momentum going into 2026 with a revitalized and expanded team with clarity and purpose. We know exactly where the business is and where our efforts need to be focused. Our field and medical teams are deeply engaged. We're educating physicians. We're supporting our patients and we're expanding awareness of cisplatin-induced ototoxicity. The organization is aligned, and we are energized, and we're excited and we are hitting on all cylinders as we go into 2026. So I'd like to thank you all for your continued support and partnership and we're looking forward to a fantastic progress in 2026 and beyond.

Thank you.

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