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Operator: Good day, and thank you for standing by. Welcome to the Fourth Quarter 2024 Aquestive Therapeutics Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speaker’s presentation, there will be a question-and-answer session. [Operator Instructions]. Please be advised today’s conference is being recorded. I would now like to hand the conference over to your speaker today, Brian Korb. Please go ahead.

Brian Korb: Thank you, operator. Good morning, and welcome to today’s call. On today’s call, I’m joined by Dan Barber, Chief Executive Officer and Ernie Toth, Chief Financial Officer, who are going to provide an overview of recent business developments and performance for the fourth quarter year ended 2024, followed by a Q&A session. During the Q&A session, the team will be joined by Dr. Carl Kraus, Chief Medical Officer; Dr. Stephen Wargacki, Chief Science Officer and Sherry Korczynski, Senior Vice President, Sales and Marketing. As a reminder, the company’s remarks today correspond with the earnings release that was issued after market closed yesterday. In addition, a recording of today’s call will be made available on Aquestive’s website within the Investors section shortly following the conclusion of this call.

To remind you, the Aquestive team will be discussing some non-GAAP financial measures this morning as part of its review of fourth quarter and year end 2024 results. A description of these measures along with a reconciliation to GAAP can be found in the earnings release issued yesterday, which is posted on the Investors section of Aquestive website. During the call, the company will be making forward-looking statements. We remind you of the company’s safe harbor language as outlined in yesterday’s earnings release as well as the risks and uncertainties affecting the company as described in the Risk Factors section and other sections included in the company’s annual report on Form 10-K filed with the Securities and Exchange Commission on March 05th 2025.

As with any pharmaceutical company with product candidates under development and products being commercialized, there are significant risks and uncertainties with respect to the company’s business and the development, regulatory approval and commercialization of its products and other matters related to operations. Given these uncertainties, you should not place undue reliance on these forward-looking statements, which speak only as of the date made. Actual results may differ materially from these statements. All forward-looking statements attributable to Aquestive or any person acting on its behalf are expressly qualified in their entirety by this cautionary statement and the cautionary statements contained in the earnings release issued yesterday.

The company assumes no obligation to update its forward-looking statements after the date of this conference call whether as a result of new information, future events or otherwise except as required under applicable law. Now, I would like to turn the call over to Dan.

Dan Barber : Thanks, Brian. I am thrilled to announce today that we have begun the filing process with the FDA for approval of our Anaphylm epinephrine sublingual film application. We will complete this application process over the next several weeks and expect the next major milestone for this program, the acceptance of the NDA sometime in June. This puts us on track to launch Anaphylm if approved by the FDA right on schedule in the first quarter of 2026. Today represents the achievement of a major milestone for our company, colleagues, and stakeholders. This achievement was years in the making by scores of dedicated people who have focused their energy on making an impact on patients’ lives. I am incredibly proud of and humbled by the achievements of these individuals.

For almost three years, you’ve heard me talk about what we believe patients need in order to be better prepared for a severe allergic reaction including anaphylaxis. We believe an epinephrine product that is carried more often will save lives. We believe epinephrine that is orally administered may be more likely to be used and used quickly and will save lives. We believe that speed matters when it comes to epinephrine absorption, and fast and significant absorption will save lives. Anaphylm was built to meet these needs. And because of this, we believe patients will ultimately choose Anaphylm as their preferred product. Our plan is that less than a year from now, Anaphylm will be approved and available for patient use. This is truly an exciting time for the company.

I am also pleased to announce today that our pediatric study for Anaphylm has progressed as expected. Our NDA will include the necessary pediatric data to support the product label that if approved by the FDA would mirror the weight and age parameters of the existing 0.3 mg EpiPen auto injector. Our pediatric data is in line with expectations and we are wrapping up the final pediatric study activities over the coming days. We believe that this will conclude all the information that will be necessary for filing our NDA for Anaphylm. In addition, we have begun preparing for a potential advisory committee meeting for Anaphylm. As you may remember, our FDA pre-NDA meeting notes from November indicate that the FDA may decide to hold an advisory committee meeting.

If this were to happen, we would expect it to occur in the second half of 2025. We have hired an experienced regulatory communications firm to aid us in our preparations and we expect to be ready well in advance of the potential meeting. Now let’s turn to our sales and marketing preparations for Anaphylm. We recently conducted an awareness trial and usage or ATU study regarding anaphylaxis and Anaphylm. While this work is always a critical component of preparing for launch, we felt it was especially important since a non-needle nasal spray became available to the public over five months ago. In the study, on an aided basis, 92% of the 125 physicians that were interviewed were aware of the FDA approved nasal spray product. Roughly 65% percent of these physicians had already written a prescription for the nasal spray.

Yet when asked to allocate the potential future prescribing habits between auto-injectors, nasal sprays and sublingual film, film received a higher percentage than both the auto-injectors and nasal spray. While I generally view survey data as just directional, I believe it is powerful that physicians who are aware of and have prescribed the existing nasal spray would still list sublingual film as their preferred, most prescribed product under the theoretical premise that film was FDA-approved and available to patients. This is before we have done the significant awareness work in marketing efforts that occurred after approval. Now let’s turn to commercialization. We believe there are multiple pathways to commercializing Anaphylm if approved by the FDA.

We continue to prepare for launching Anaphylm on our own and most recently hired in house market access expertise to further drive our ongoing discussions with payers. This is in addition to the medical affairs awareness work we have been conducting, including increasing our medical publications, posters and presence at regional and national medical conferences. This work will intensify in the coming quarters as will our commercial preparation. As a reminder, our plan remains to obtain FDA approval prior to hiring a sales force. Another pathway for us to commercialize Anaphylm if approved by the FDA would be to augment our commercial capabilities with a larger, more established sales and marketing organization. This is something that we are actively contemplating, but will only do if the conditions are right for our company.

These conditions, at a minimum, include working with a company that has the size and scale to truly expand our engagement efforts and a true commitment to patients in this therapeutic area. Only time will tell what the right path is for Anaphylm. Once we have completed our Anaphylm submission to the FDA, we will also begin focusing on international markets and partnerships. Our initial focus will be to submit applications in the EU, UK and Canada. We are exploring partnerships for ex-U.S. Commercialization of Anaphylm and expect these ex-U.S. Partnerships would contribute significantly to the company. We are also actively planning for our future. In the next quarter, we will open our investigational new drug application or IND for AQST-108, our topical gel formulation of epinephrine.

As previously discussed, we believe that AQST-108 could be extremely meaningful to the millions of patients managing alopecia areata or AA as well as other dermatological conditions, we expect to start our Phase 2a trial for AQST-108 in the next quarter and have some level of clinical data available to share with you before the end of this year. This timing is dependent on patient recruitment as well as our final protocol design. As a reminder, an estimated 6.7 million people in The US are affected by AA. Of those affected, 43% are considered severe. The existing therapies for AA are Janus Kinase or JAK inhibitors. These systemic treatments with known side effects come with a black box warning and are expensive for patients. Even with these limitations, the current estimated market opportunity for JAK inhibitors is over $1 billion.

As Anaphylm comes to market, if approved by the FDA, we expect AQST-108 to become our lead pipeline opportunity. Now let’s turn to Libervant. We were obviously disappointed by the recent federal court ruling that held the FDA’s rationale for granting Libervant approval and orphan drug market exclusivity for underserved patients aged between two and five years was not acceptable and we have appealed this ruling. Let’s keep in mind that Libervant currently treats young vulnerable children who have in their case recently been diagnosed with epilepsy, are on maintenance medication and are still at risk of seizure clusters. We remain committed to doing everything we can to keep Libervant on the market for these young patients. We will continue to engage the FDA and the court system to protect these patients.

We will keep you informed as we learn more. However, it is important to remember that in less than two years, we expect to be able to provide Libervant to all age groups regardless of any outcome in the courts. In conclusion, this is a remarkable time for Aquestive. We have more levers of growth than ever before in the history of the company. We expect to realize the following milestones in the coming months: FDA acceptance of our Anaphylm NDA submission, opening of our IND for AQST-108 and the start of our Phase 2A clinical trial, engagement with international regulatory bodies for expanding Anaphylm filings to ex-U.S. Territories, continuing to build towards the commercial launch of Anaphylm if approved by the FDA and continuing to fight for patient access to Libervant.

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

Ernie Toth: Thank you, Dan, and good morning, everyone. By now, you have seen our financial results in our earnings release that was issued last evening. As we typically do, we will address most of the discussion related to the fourth quarter 2024 and full-year 2024 results in the Q&A. During 2024, we made great progress in positioning Aquestive for success. We strengthened our balance sheet by raising over $78 million in capital from high-quality institutional healthcare investors that allowed continued investment in our strategic priorities, including advancing the development of Anaphylm, our lead asset, by completing all planned adult clinical trials and receiving positive feedback in the pre-NDA meeting with the FDA. Having a successful pre-IND meeting for our product candidate AQST-108, a topical gel formulation of epinephrine.

Now, let’s turn to the recap of our quarterly and full-year financial results. Total revenue decreased to $11.9 million in the fourth quarter 2024 from $13.2 million in the fourth quarter 2023. This 10% decrease in revenue was primarily driven by decreases in license and royalty revenue due to $1 million of milestone royalty revenue for Azstarys from Zevra Therapeutics recognized in the prior year. Manufacture and supply revenue decreased to $10.7 million in the fourth quarter 2024 from $11 million in the fourth quarter 2023, primarily due to a decrease in Suboxone revenues, partially offset by an increase in revenue for Omni from Hypera. License and royalty revenue decreased to $0.8 million in the fourth quarter 2024 from $1.9 million in the fourth quarter 2023, primarily due to the previously mentioned royalty revenue for Azstarys from Zevra Therapeutics recognized in the prior year.

Co-development and research fees in the fourth quarter 2024 remain relatively unchanged compared to the same period in the prior year. Total revenues increased to $57.6 million for the full year 2024 from $50.6 million for the full year 2023. This 14% increase in revenue was primarily driven by increases in license and royalty revenue due to the recognition of deferred revenue from the termination of licensing and supply agreements and increases in co-development and research fees, partially offset by decreases in manufacturer and supply revenue. Excluding this one-time recognition of deferred revenue, total revenues decreased by $4.5 million or 9% year-over-year. Manufacture and supply revenue decreased to $40 million for the full year 2024 from $43.8 million for the full year 2023, primarily due to decreases in Suboxone and Sympazan revenues, partially offset by an increase in Emylif revenues from Zambon and an increase in Ondif revenues from Hypera.

Excluding a one-time retroactive price increase of $1.7 million recognized in the prior year, manufacturer and supplier revenue decreased to $40 million from $42.1 million. Research and development expenses increased to $4.9 million in the fourth quarter 2024 from $2.9 million in the fourth quarter 2023. The increase in research and development expenses was primarily due to clinical trial costs associated with the continued advancement of the Anaphylm development program. Research and development expenses increased to $20.3 million for the full year 2024 from $13.1 million for the full year 2023. The increase in research and development expenses was primarily due to clinical trial costs and product research expenses associated with the continued advancement of both the Anaphylm and AQST-108 programs, as well as increase in personnel cost and an increase in share-based compensation.

Selling, general and administrative expenses increased to $16 million in the fourth quarter of 2024 from $9.6 million in the fourth quarter of 2023, primarily due to increased commercial spending and regulatory fees related to the approval of Libervant for ages 2 to 5, pre-commercial preparations for Anaphylm, severance costs of $1.8 million and higher legal expenses of $1.5 million, partially offset by a decrease in insurance fees. Selling, general and administrative expenses increased to $50.2 million for the full year 2024 from $31.8 million for the full year 2023. The increase was partially driven by severance costs of $2.9 million and higher personnel costs. The remainder of the increase is largely driven by higher commercial spending and regulatory fees related to the approval of Libervant for ages 2 to 5 and pre-commercial preparations for Anaphylm, partially offset by a decrease in insurance fees.

Aquestive’s net loss for the fourth quarter of 2024 was $17.1 million or $0.19 for both basic and diluted loss per share compared to the net loss for the fourth quarter of 2023 of $8.1 million or $0.12 for both basic and diluted loss per share. Aquestive’s net loss for the full year 2024 was $44.1 million or $0.51 for both basic and diluted loss per share compared to the net loss for the full year 2023 of $7.9 million or $0.13 for both basic and diluted loss per share. The increase in net loss for both the fourth quarter 2024 and full year 2024 was driven by increases in selling, general and administrative expenses; research and development expenses; noncash interest expense related to the amortization of the debt and royalty obligation discounts; and decreases in revenues, partially offset by increases in interest income and other income and decreases in manufacture and supply expenses and loss on the extinguishment of debt.

Non-GAAP adjusted EBITDA loss was $11 million in the fourth quarter 2024 compared to non-GAAP adjusted EBITDA loss of $2.8 million in the fourth quarter of 2023. Non-GAAP adjusted EBITDA loss, excluding adjusted R&D expenses, was $6.6 million in the fourth quarter of 2024 compared to a non-GAAP adjusted EBITDA loss, excluding adjusted R&D expenses, of $0.1 million in the fourth quarter of 2023. Non-GAAP adjusted EBITDA loss was $23 million for the full year 2024 compared to non-GAAP adjusted EBITDA loss of $11.6 million for the full year 2023. Non-GAAP adjusted EBITDA loss, excluding adjusted R&D expenses, was $4 million for the full year 2024 compared to non-GAAP adjusted EBITDA income excluding adjusted R&D expenses of $1 million for the full year 2023.

As of December 31, 2024, cash and cash equivalents were $71.5 million. On a pro forma basis, the company’s cash and cash equivalents were approximately $93 million adjusted for the $21.4 million raised through the company’s ATM facility on February 14, 2025. The recent ATM activity continued our goal of strengthening our balance sheet as we prepare for the commercial launch of Anaphylm, if approved by the FDA. This sale of stock under the ATM facility was a result of inbound interest from two high-quality institutional health care investors, one being an existing investor. Their additional investment in Aquestive shows confidence in our story and our goal of getting products in the hands of patients. Our focus in 2025 is on the advancement of our Anaphylm and AQST-108 development programs and continued commercialization of Libervant for patients ages between 2 years and 5 years.

As outlined in the press release issued last night after market close, our outlook for 2025 is: Total revenues of approximately $47 million to $56 million and non-GAAP adjusted EBITDA loss of approximately $46 million to $53 million. Our revenue guidance for 2025 includes Libervant for ages between 2 years and 5 years and some level of erosion in the demand for Suboxone. As a reminder, our 2024 revenue included onetime nonrecurring recognition of deferred revenue related to the termination of certain licensing and supply agreements. Our non-GAAP adjusted EBITDA loss guidance for 2025 includes significant pre-commercial spending for Anaphylm, costs associated with the submission of the Anaphylm NDA and related filing fee, completion of the Anaphylm pediatric clinical trial, preparations for a potential advisory committee meeting if required by the FDA for approval of Anaphylm, commencing the AQST-108 Phase 2a clinical trial in the second quarter of 2025 and continued commercialization of Libervant for epilepsy patients between ages 2 years and 5 years.

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

Operator: [Operator Instructions]. Our first question comes from Roanna Ruiz with Leerink Partners. Your line is open.

Unidentified Analyst: This is Nick Gasset on for Roanna. Thanks for taking my questions. Maybe first from us, could you remind us what are some of the key topics that the FDA might want to clarify or dig into a potential advisory committee meeting? And what gives you confidence in Anaphylm’s profile, I guess, from a PK/PD standpoint heading into this potential meeting?

Dan Barber: Sure. Good morning, Nick. Nice to hear your voice. It’s been an interesting process with the team here as we put the NDA together and starting to submit it to the FDA. And one of the outcomes of that is we’ve just continued to grow more and more constant in the profile of our product and that, that profile is the preferred and best profile for someone who is experiencing an allergic reaction. And when you think about it, it’s really just common sense. We all know that epinephrine stabilizes mast cells and stops mediator release. We all know that without epinephrine, mast cell degranulation accelerates, it can be life-threatening and what some of you may not know is that when there is a bad outcome from an allergic reaction that, that typically almost always happens in the first 30 minutes and that’s due to a drop-in blood pressure or blocked airway.

So, when you look at our profile, we have a fast and rapid uptake of epinephrine. We have a rapid change in blood pressure. We’ve shown that localized epinephrine rapidly reduces mucosal edema. And we love this comparison to the products that are out there. We think the ability in that first 15 minutes to say that we are comparable to the auto-injector, it’s really powerful. And we also think going, back to the common-sense approach, that on an individual basis when you ask someone what would you want? The obvious answer is, “I want something that gives me enough epinephrine to ensure that I stop the allergic reaction that I have.” So, when we get to the Ad Comm, we believe that we’ll have the opportunity to tell our story on our profile, and we think that will be received really very positively, not only by the Ad Comm, but by the other involved constituents of that day.

So, we’re looking forward to the Ad Comm if it does occur.

Unidentified Analyst: Got it. And then maybe a second question for me. I guess like thinking ahead to a potential approval and launch, which types of patients do you think would be the early adopters of Anaphylm over some of the other approved and commonly used epinephrine products that are out there?

Dan Barber: Right. Well, look, I’ll hand it over to Sherry in a second to give you her view. But I will fully admit my view is that anyone and everyone who is at risk of having anaphylaxis. One should carry a rescue product into our Rescue product absolutely should fit whatever profile that individual will have. But I’ll let Sherry give you some of her thoughts.

Sherry Korczynski: As you know, we spent a lot of time at this past weekend, posters, dozens of one-on-ones with key opinion leaders and allergists and what we continue to hear over and over again is that because Anaphylm is the easiest to carry, it works so quickly and it’s not a device that it has really opened the door to all patients. And so, we’re really excited about that from a marketing segmentation perspective, look, we definitely believe anybody any starting at the age where kids starts carrying a phone that would certainly be a primary target and then going up, but there will be lots of opportunities and options for all patients who want to carry Anaphylm. So again, we feel very strongly that it is a very broad market for Anaphylm because of how easy it is to carry and to use.

And certainly, there will be certain segments that, again, teenagers, young adults, men that will certainly want to be able to have it in their pockets, in their phones very, very quickly.

Operator: [Operator Instructions]. Our next question comes from David Amsellem with Piper Sandler. Your line is open.

David Amsellem: So, just got a few. First on commercialization. Just wanted to clarify, so it sounds like you are full steam ahead in terms of building your commercial infrastructure, but you are open to some sort of partnership arrangements. So, I just wanted to get a sense of how likely some sort of partnership is versus just going it alone? That’s number one. Number two, regarding the launch of neffy, any sort of early learnings that you gleaned from that launch in terms of how you’re thinking about your opportunity, particularly interested in the extent to which the availability of neffy is expanding the market and any evidence of that? So that’s number two. And then lastly, on Libervant, and I know I had asked this question a bunch of times, but I think it bears asking again is just how are you thinking about this asset, just given all the other things you have going on in the organization? And is that something you’re looking to out-license? Thanks.

Dan Barber: Sure. Thanks, David. So, let me first tackle your question on commercialization going it alone versus having a partner, and then I’ll pass it over to Sherry, who can give you her thoughts on what she’s seen with the competitor launch and your questions there. So first, as Ernie outlined in his prepared comments, our financial guidance for the year is based on us launching Anaphylm on our own. So, we are investing significant time, resources, energy money in the second half of this year to make sure that we are ready to launch as soon as that approval comes through in the first quarter of 2026, which by the way, as a reminder, is before the allergy season next year. So great timing from our perspective to launch. The likelihood of which path we take is a really hard one, right?

Because our role here as a management team is to maximize the value of Anaphylm for all stakeholders. And that value, obviously, heavily includes investors and what is good for them, but it also includes patients and making sure that we can get to the broadest scope of patients that we possibly can. So, we’re prepared to do that on our own, and we’ve lined up the plan and the spending to do that. But if the right match comes along to make us bigger, bolder and be able to get the product out further, we absolutely will engage in that. So, we’ll see as the months go by, and I’ll keep you and everyone else as informed as I can. Now let me pass it over to Sherry to talk about what you’ve seen with the competitor launch.

Sherry Korczynski: Good morning. So, as you know, and then we saw out at this past weekend, awareness of alternatives to the needles and auto-injectors, remains key, right? It’s about a strong message about what else is now available. So, I would say physicians are asking the question is the product going to work? And so that’s the key. We feel very strongly that we have the data upon approval that we will be able to share with physicians that it works. We have what I believe is the most robust package ever filed for epinephrine. We have the OASIS study that is very supportive. And so, as we’re seeing the ARS launch of neffy, they’re driving messaging to ATPs, they’ll be launching consumer campaigns. And so overall, working to get the switches and build the market.

That’s a good thing. As it relates to neffy and ultimately to Anaphylm, the payers are the key. And so, we know that it is critically important to ATPs of patients to have full access to their epinephrine product. We have heard loud and clear that Anaphylm is a game changer for patients because time is of the essence in this life-threatening situation. And physicians believe that the product will be carried more often and used earlier. And so, it’s our responsibility and why we have brought in-house expertise in our most recent hire new VP of Market Access, who has 25-plus years of launching 20-plus products at big and small pharma to help us do this because it is a key area of focus. We know it is for ARS and it will be for us as well.

Dan Barber: And David, I think the last part of your question was on Libervant, which — look, Libervant has unfortunately just time after time faced struggle outside of the value of the product to patients, right? I — today, I believe in the value of Libervant for patients just as much, if not more, as they did years ago. So, there will come a day where we can provide Libervant to all patients and we look forward to that day, and we think that will be a valuable day not only for patients but for us as an organization. In terms of where it fits in the broader strategy of Aquestive? I think we’re at an interesting crossroads right now as a company where we have tremendous value in a variety of places. And I think it remains to be seen over the next 12 months to 24 months how that value grows the company. So Libervant is important, will continue to be important and it’s placed in our organization, I think, will be clarified as time goes on.

David Amsellem: Okay. Helpful. Thank you.

Operator: [Operator Instructions]. Your next question comes from François Brisebois with Oppenheimer. Your line is open.

Francois Brisebois: Thanks for taking my question. Congrats on the progress here with the submission. I just wanted to touch on something you just mentioned on David’s question about the importance of the timing of the launch. Can you just help us understand what that means and how seasonality is important for this specific market? And then I have a follow-up.

Dan Barber: Sure. Yes. Let me pass it over to Sherry, Frank.

Sherry Korczynski: Look, I think that we are going to launch at a perfect time. So, there is seasonality. The epinephrine market, there is this big seasonality in the epinephrine market. So, you see, and I’m sure you see from the same numbers I do, that the market starts to build in the April, May time frame, getting ready for camps. The true season begins in mid-summer and then really peaks August and September. So, as we think about launching early, assume we have a PDUFA date early February, will be our coming out party and we’ll be right in time for the season. And especially if you think about 6 months in, it will be right at that time where patients are going in for their refills, getting their new prescriptions for back-to-school, and so we think it is a great timing.

You may be saying, “Well, what about payers then?” Again, this is why we have brought in-house expertise to really ensure that we are working with the payers today to prepare us as best as possible for that launch, hopefully, next February of 2026.

Francois Brisebois: Excellent. And then you discussed the importance of the rapid onset and being comparable to EpiPen and the importance of the start. But another topic that comes up sometimes when people think about the Ad Comm and what might be important and you guys have mentioned is, is on the safety front. So, I was just wondering if you could share a little bit more about what makes you feel comfortable about the PK/PD profile, on the safety front? And especially with emphasis on kind of the Cmax on the but especially on the repeat dose and just what makes you comfortable with those levels of epinephrine? Thank you.

Dan Barber: No, thanks, Frank, for that. So, Sherry, said something before that I think deserves a little bit more airtime. This is the most robust package ever put together for epinephrine for the FDA. We have over 900 dosing in our film. We have twice as many subjects in our package as the competing nasal spray that was just approved. So, we have a very, very robust package that we’re putting in with the FDA, which has a very clean, from our perspective, AE profile and no SAEs. So, when we look at the package we’ve created, we’re very excited. And you mentioned the rapid onset with the first dose, and you really do have to start with the first dose. When you think about — you’ve heard people in this space talk about this idea of bracketing to get to approval, well the weakness in bracketing is it allows you to be low for the first 15 minutes or 30 minutes if you want to be and still get approved.

We think that’s the wrong profile. We think that is when mortality occurs. In fact, and can tell you more if we had time. The mortality rate hasn’t changed in decades. So clearly something needs to be done to make sure you get a robust enough amount of epinephrine in that first 15 minutes or 30 minutes. So, we don’t — it’s interesting, as you hear comments around the space, we don’t apologize for the amount of epinephrine we’re giving with our first dose or our second dose, that’s exactly what we think people need. So, let’s talk about that second dose and this supposed concern about the level of epinephrine. If you need a second dose of epinephrine, time has gone by, you are further into the disease state. The cascade of mast cell degranulation is further along, and now you’re in real trouble.

So, you need a significant amount of epinephrine to get out of that cycle. And we think, and Carl and the team are putting everything together, we think in the Ad Comm that we will have a very compelling story to tell that lines up with the science and the data that we have supporting what we’re — what our profile looks like and how it is the preferred one for patients.

Francois Brisebois: Okay. Great. And just maybe to finish on that, is that the level that we’ve seen with the curves, is that still a physiological range of epinephrine in the body or are we talking about super physiological here?

Dan Barber: Yes. So, I’ll pass that over to Carl to give his view.

Carl Kraus: Yes. No, appreciate the question. And when you say physiologic range, obviously, the human body is well designed to address various stress states. So, if you go for a run, obviously, your epinephrine levels are going to rise. And if you’re resting at home, it’s obviously going to go down. The pharmacokinetic profile of epinephrine is such that we see linear kinetics for pharmacokinetics, but hemodynamic pharmacodynamics, it’s not linear. I mean you reach a threshold to whatever epidemic levels you have in your body, at some point, trees don’t grow ever taller, you don’t have your heart rate, your blood pressure going ever higher. So, there is a threshold that’s reached, but those levels that are required to make sure you address stress situations we’re built for that. I don’t foresee any concerns outside the physiologic range right now.

Operator: [Operator Instructions]. Our next question comes from Kristen Kluska with Cantor Fitzgerald. Your line is open.

Kristen Kluska: Hi, good morning, everybody, and thanks for taking my question. The first is, can you speak a little bit more about some of the potential pre-Ad Comm work that you’re doing? I think you’re in a pretty unique situation having a list of all the unsolicited FDA comments from the pre-NDA meeting. Have you considered hiring any of the Ad Comm services or conducting a mock Ad Comm yourself ahead of this potential event?

Dan Barber: Yes. Thank you, Kristen. Yes, we have — so as you know, the advisory committee process with the FDA is formulaic. So, there is an order to how the day goes and every Ad Comm follows that process. So, we have brought on external expertise to help us make sure we are ready for each section of that day. There’s already a team inside of our company that meets on a weekly basis to go through the pieces and parts, and while we don’t expect the Ad Comm, if it occurs, to happen until the fall, we are going to be ready well in advance of that. So, look, it’s a lot of work for a company to get prepared. But it is — if the Ad Comm occurs, it is a really nice day for us to be able to showcase all the great things about our program.

Kristen Kluska: Okay. And as you’re doing a lot of the work getting in front of physicians at conferences, et cetera, we often talk about the current EAI market. These patients obviously understand the seriousness and need to carry a form of epinephrine, but as we start thinking about the market shifting into needleless forms, how would you think in the future about penetrating into those markets where patients know that they have a serious condition, but they know that they didn’t want to carry a needle or they were afraid of a needle or it was too large, et cetera? Do you think there could be an uptick in that sale relative to what we would naturally expect as a big shift from patients also on EAIs right now?

Dan Barber: Yes. Well, I’ll pass it over to Sherry in a second to give her thoughts, but I’ll just give one global thought, which is, as we, again, as we’ve been putting the NDA together in preparing all the pieces and parts for the FDA. One thing that continues to strike me is the number of times that anaphylaxis occurs including where there’s the ultimately bad outcome of that, where the individual had never been prescribed a rescue product and didn’t even know they needed a rescue product. So, in terms of just globally, there absolutely is a need for much greater awareness to protect people. But Sherry could talk more about how that manifests itself in the marketplace.

Sherry Korczynski: What I believe, based on all of the market research that we have been conducting, Dan mentioned, our recent ATU as well as the meetings that we are attending and I met with dozens of physicians this past weekend one-on-one. And I think something that you’ll see and we believe will occur is — right now, the way people are maybe looking at this, it’s about a needle versus a non-needle. We believe based on our research and our conversations is this will — the market will shift from devices versus an oral. So that’s a key difference in all devices. And when you think about not only it’s not an oral pill, it’s an oral film that fits in the back of your phone. And so, something that you people always have with them is their phone.

And so again, I do believe this will grow because of — it is the — Anaphylm is the easiest to carry, it is the easiest to use it’s going to work, work quickly in that life-threatening situation. And obviously, I’m very bullish about it. And — but I do believe we’re going to see, over time, a shift from device carrying to the film or oral. So that’s how I’m thinking about it, Kristen.

Operator: [Operator Instructions]. Our next question comes from Jason Butler with Citizens JMP. Your line is open.

Jason Butler: Hi. Thanks for taking my questions. Just a couple for me. So first on Libervant. How do you think about investing in the product commercially following the court decision last month and how could that change throughout 2025? And then just on Anil, can you talk about what additional awareness work you can do this year? Obviously, was an important meeting, but what additional work you’ll do to prepare for the launch? Thanks.

Dan Barber: Sure. So, on Libervant, so for me, the biggest thing to keep in mind on Libervant. And it’s interesting in this industry. Sometimes people forget that we are our ultimate purpose is to actually improve patients’ lives. So, when I look at Libervant, we’re very proud here that we have a product that we think is meaningful to patients does save patients’ lives and helps in a spot where we’re talking about 2- to 5-year-old children. So, my focus right now is on making sure that we do everything we can to ensure patients in that age group who are using our product, continue to be able to use our product. Over the mid- to long term, once that’s sorted out, we continue to believe that Libervant is useful and meaningful for all age groups.

And you’ll see us look to make sure patients have access to that. Now how they have access, whether it’s to your question on investing in more commercial infrastructure or partnering or finding another way to provide access to patients, we’re always on every product, always looking at what’s the best way to do that. But my primary focus right now is how do we make sure patients continue to have access to a product that we think is very important to them. On Anaphylm awareness and the activities that we’ll be focused on this year, I’ll pass it over to Sherry, again.

Sherry Korczynski: Thanks, Dan. Yes, so as we mentioned, we’ve been to going to conferences the college. We’re doing — we’re investing significantly in our medical presence. So not only the big conferences but dozens of regional and local conferences to ensure that the messaging is out of who is Aquestive and why Anaphylm is a game changer and will be the best choice for patients when it is available. I think some other things you want to think about is we’ve been conducting CME. Additionally, non-CME disease state awareness work, as I mentioned, dozens of conferences, posters, publications, medical team that is out talking to customers, KOLs, regional KOLs, so we’re really working to get our messaging out. Another aspect of this as you prepare — as we prepare for launch is the deep relationships we have with advocacy organization.

So, in the space, there’s four main advocacy organizations and based on my prior experience as well as in here at Aquestive team members, we do have significant relationships with the advocacy organization, and we will continue to be present at their event.

Operator: [Operator Instructions]. Our next question comes from Raghuram Selvaraju with H.C. Wainwright. Your line is now open.

Raghuram Selvaraju: Thanks for taking my questions. Congrats on all the recent progress. I just wanted to see if you could comment on sort of what so far has been the commercial experience with the epinephrine nasal spray? What you’ve been hearing with regard to whether or not that product has outperformed expectations? And in particular, if you could talk about the promotional activities that have been undertaken in support of that product and what relevance those might have to your potential future launch of Anaphylm? As an example, there is a fair amount of DTC activity going on in support of that product. Just wanted to see how that fits into your thinking regarding the future marketing campaign for Anaphylm as and when it gets approved. And if there’s any granularity you can provide to us at this time regarding what you expect and implies promotional budget to be for a product like Anaphylm, once it is approved in the United States?

Dan Barber: Yes. So, let me give you my — you heard Sherry’s thoughts before on the space. Let me give you some my thoughts and Sherry can round it out if need be. But first, on the expectations, the commercial experience and expectations from a competing product. I will leave it to our competitor to tell the space, how they feel about their performance versus expectations and don’t want don’t want to shave that one way or the other for them. What I would say in terms of the commercial experience of what we’re seeing, as Sherry laid out before, there is a significant need in this space to build awareness. And so — and that awareness is that truly is a rising tide raises all boats in this case because it is about making sure that the people who are not carrying realize there are other solutions that may bring them back into the market.

The people who are carrying, but are not satisfied with their solution, showing them that there’s something out there. So, we — there are big dollars being spent on awareness right now. We’re very happy about that, and we hope it continues, and we think that helps everyone. We are hearing, as Sherry talked about before, that physicians want to know that the product works, and that is a difficult thing to do in a space where efficacy studies can’t be performed and you’re using a 505(b)(2) comparability package. So, for us, you’ll hear us this year, and we just did a focus a lot on our OASIS study. In our OASIS study, edema was resolved, and I’m just looking at Carl to make sure I get the number right, but I believe in 5 minutes. So, we know that we have a study that no one else has in patients who are having an allergic reaction in their oral cavity where we can show the benefit of how quickly that benefit comes through.

So, we’re very excited about that. In terms of the last part of your question on DTC spend. One of the positives about a drug like Anaphylm in a space that it did is it’s flexible, right? There’s lily probably a mathematical equation of the more you spend, you get this; the less you spend, you get this. So, we think it’s a large market that as we scale and as we’re able to afford bigger and bigger DTC budgets, we’ll continue to grow and grow. So, we won’t start out with a giant DTC budget because that’s just not us and we will be respectful of the balance sheet that we have. But we think it still will be meaningful enough to get Anaphylm into a growth mode where we can continue to build it over time.

Raghuram Selvaraju: That’s very helpful. With respect to Libervant, I just wanted to clarify, the court decision, a, it seems as though the court is going off of the orphan drug exclusivity for Valtoco and it’s not paying attention to the demarcation between the Valtoco label and Libervant label. Is that correct?

Dan Barber: Yes. with courts, you’re never really sure which way things are going to turn, right? So, it’s always kind of a coin toss of what a judge will do, what the appeals court will do, what the next judge will do. So, look, we’re — I think the right way to think about it is we understand that Anaphylm is something we have to get filed and get through the FDA and continue to build our organization. But we think that Libervant is important to patients. And so, we will continue to invest in making sure that we fight in the courts and that we get Libervant to a place where patients can continue to have access to it. Having said that, it’s the court system and you don’t know until it’s over.

Raghuram Selvaraju: But in any case, just to clarify, while the appeal process is ongoing, there is no change to the authorization that Libervant currently has. Is that correct?

Dan Barber: Well, that’s up to the judge in the courts, right? So, it depends on how they — what their decisions are as we go through the process. So, there is a broad range of outcomes that could occur. And just like all of you listening today, at some level, we’re listening as well. We have to see where the judge ultimately ends up.

Raghuram Selvaraju: And then just in terms of how long it could take for the appeals process to play out, can you just contextualize that for us in the context of the timing with which the ODE for Valtoco is slated to expire?

Dan Barber: Yes. Well, look, so let’s start with when the ODE for Valtoco expires, right? That is in early 2027. So, we, on a global product basis, will be ready to provide Libervant to all age groups when that day comes. And none of this court exercise will change that. In terms of how long an appeal process takes right now for the 2- to 5-year-old space on Libervant, I hate to give guidance on that. I think the courts at times can move very slowly, at times can move very fast. And all we can do is keep pushing to make sure patients have access and that’s what we’ll do.

Raghuram Selvaraju: Okay. Then just very quickly for Ernie. As has been the case in years past, you’ve provided a relatively wide top-line guidance range. I was just wondering if, a, you expect as has been done previously to narrow that range as we go further into 2025? And b, if you could maybe give us some sense of what the tailwinds might be that you are factoring into driving the company’s top-line performance towards the upper end of that range? In other words, what could be the factors that drive you towards that $66 million number as opposed to the $47 million number?

Ernie Toth: So, one thing we got to remember we do have for this year, revenue from Libervant, 4.2 to 5 in the guide. Of course, as you just discussed about the court case, that is something that could impact the range of guidance as we move forward during the year. In addition, on Suboxone, as I mentioned in my script, there is some level of erosion that we’ve baked in as we usually do. Whether there could be increased generic competition for Suboxone, we’re just unsure of right now. So, I think as the year progresses and we see how the market firms up for Suboxone and the orders we get from Indivior that would impact our guidance as we move forward and we could — we certainly would be tightening the range.

Raghuram Selvaraju: Thank you.

Operator: [Operator Instructions]. Our next question comes from Gary Nachman with Raymond James. Your line is now open.

Gary Nachman: Great. Good morning. So back to the Ad Comm, as you’re preparing for it, you specifically called out some decent spending behind that, Dan, it sounds like you’re now leaning much more to the likelihood that you’ll have the Ad Comm. So, has there been any more guidance from FDA on that as you’ve been preparing the filing or are you just being extra cautious on this? And then I have some follow-ups.

Dan Barber: Yes. we have no additional insight from the FDA. We are we’re doing what good stewards of a company should do and preparing without thought of whether it will or will not happen. And obviously, ultimately, it’s up to the FDA whether they decide to have it or not.

Gary Nachman: Okay. And then you said you saw some initial data from the pediatric study for Anaphylm that you said was in line with expectations. Any more color on that? And when will you have the final data just to ensure there are no issues there for the filing? And then on commercial, if you end up commercializing Anaphylm on your own how many reps will you need? And then how quickly will we be able to get them on board after the approval to launch very quickly there?

Dan Barber: Right. Well, I’ll pass it over to Carl in a second, I know you’ve been dying to jump in on the pediatric study, so thank you for that question, but I’ll just give a timing answer. In terms of the pediatric data, we have a big chunk of it right now. We’re getting more shortly. And in terms of making sure the NDA, we have that timing mapped out so that there’s no issue, but I’ll let Carl give you his thoughts on what he’s seeing.

Carl Kraus: Yes. No, I appreciate the question. And as Dan already stated, the intention is to provide the necessary elements of the pediatric study into the filing that is certainly completely on schedule. The profiles we’re seeing from the pediatric study are completely in accord with our expectations and for the requirement of submitting the filing as already stated, we will have the necessary data from the pediatric study to support it. So, we’re extremely pleased not only with the timing but also the data that we’re seeing coming out of that study.

Dan Barber: And I think the next part of your question, Gary, was on the number of reps. I’ll let Sherry give you her thoughts on how she would build up to the right amount. But just as a reminder, we’ve given clear guidance, we will not hire a single sales rep until after approval, but Sherry can take it from there.

Sherry Korczynski: Thanks, Gary. As you think about the number of allergists that are practicing as well as some very kind of high decile pediatricians, some PCPs and nurse practitioner PAs, we believe in that around 100 mark is a good number for us to start with as far as the sales force. They go up, they go down, they folks. But overall, to cover the most important customers, I think we’re at a sweet spot of about 100. So that’s first and foremost. And as Dan mentioned, we would not make offers until after approval. However, we will spend a good deal of time in Q4 preparing to make those hires, so that upon approval, we would be ready to hire

Gary Nachman: Okay. And then just last question back on the partnership discussions that you’re having. Is it possible that you could have a full global partner for Anaphylm or that it would more likely be split up by geography, U.S. versus ex-U.S.? And then, Dan, maybe you could just give a little bit of color just the type of partnership that you think would make sense. It’s probably a lot of different iterations there. But if you do sign someone in the U.S. and you decide to go down that test. What do you think that might look like? And are you really leaning towards having a COCO where you would also have a commercial presence? Is that an important piece of it?

Dan Barber: Yes. Now for the U.S., in particular, we will not comment. So, we are — we will not — if we were to partner with someone, we will not partner with someone unless, as I said in my prepared remarks, they have a significant muscle to help us and that they have a significant commitment to the therapeutic space. So those are entry criteria for talking with us that we will not waver from. In terms of whether it ultimately, we find a global partner or a U.S. partner if we go down that path, I think there are large companies that fit both of the criteria I laid out that could be both global or just U.S. So, I think both of those are available. I do want to just remind everyone that ex-U.S., we clearly — in the U.S., it’s more about what’s the right path for getting Anaphylm to everyone. Outside the U.S., we will be on a partnership-only approach. So, a little bit of a nuance between those 2 positions.

Gary Nachman: Okay. And I mean, just in terms of timing, I know this might be a difficult question to answer. But do you think you could have a partnership in place before there would be an Ad Comm, if there is an Ad Comm? Just because you are spending a lot behind all your prelaunch activities, so you have to manage that with the possibility that you could have a partner that would share in that. So, is it reasonable to think that people would want more visibility on the path forward? Or do you think there’s enough there where you could potentially execute it sooner?

Dan Barber: Yes, Gary, you and I have known each other a long time, right? I learned long ago, you don’t run a business based on trying to do something by a date, right? So, we’re not focused on any particular date or any moment in time or inflection point of you have to do something here or not do something. We have our path, we have our plan, we’re very fortunate to have not only Sherry, but people under Sherry who are very talented. We’re more than happy to bring this to market ourselves. And if the right partner comes along that can augment our ability, we’ll do that. If they don’t, we won’t. So, there’s no timing element to that, that we will force ourselves or anyone else to.

Operator: [Operator Instructions]. Our next question comes from Thomas Flaten with Lake Street Capital Markets. Your line is now open.

Thomas Flaten: Just a follow-up on a couple of questions have been asked already. Sherry, back to the hiring of the sales force and the very peculiar seasonality associated with this type of product. When would be the optimal time then assuming a February PDUFA date, like you had said in an earlier response, would you want to have those reps out in the field?

Sherry Korczynski: Almost immediately. So, if you think about, if we’re in early phase, you just assume early February, you have at the end of February of 2026, and so — and the season starts to ramp up and so yes, we would look to do all the preparation work prior to the PDUFA and then hire the reps immediately thereafter.

Thomas Flaten: Got it. And then, Dan, just to clarify, given the pediatric data, how many presentations of the product will there be — how many dosage forms will you actually have available for prescribing once the product is approved?

Dan Barber: Yes. So, the initial approval will be for patients 30 kilos and up, which is about 7 years of age. And that will be comparable to the adult dose of the EpiPen the adult down to 30. So that’s just one dose. We will, after that, just like the other companies around us put a junior dose through its paces that the FDA bring that to market. So, at launch next spring, there will be one dose. Over time as we take a view of the whole market, there will ultimately be two doses.

Operator: [Operator Instructions]. Your next question comes from James Molloy with Alliance Global Partners. Your line is now open.

James Molloy: Ernie, just a quick one on the — this may tie into the partnership question that was just asked earlier. When you look at the $16 million G&A spend in the fourth quarter, is that the level we should be looking at going forward? Is that dependent upon whether or not you’re going to have a partner to — for Anaphylm or is that number going to be going doubling, going back to the 12 level through ’25?

Ernie Toth: Well, one thing in the — Jim, in the fourth quarter, there was a severance charge in there. So that inflated somewhat of the fourth quarter. But looking forward to ’25, as I said in my prepared remarks on our guidance, we have included amounts for the pre-commercial work for Anaphylm, some of which Sherry has alluded to earlier in her comments, we are continuing to commercialize Libervant. And so, we would see some increase in our SG&A, most likely in the second half of the year is where it will be more heavily weighted as we prepare for — as we continue all the pre-commercial work for Anaphylm.

James Molloy: Great. And then last question for me then on the Libervant. Any risk in marketing Libervant, given rolling out there? I know it was touched upon that you don’t really know what’s going to happen with the courts. But if — any thoughts on timing and any risk you might have on still marketing Libervant given this recent ruling?

Dan Barber: Yes. Look, the risk on marketing Libervant is completely the court system. So similar to — my answer to Gary on timing of if we were to partner Anaphylm, it’s similar with Libervant with the courts. There are certain things we can control in this universe and the court system timing and the core system decision is not one of those. So, we will — we’re committed to patients in this space. We think our product is important. We think it’s important to patients. We’ll continue to fight and advocate for them, and we’ll see what happens.

Operator: I’m not showing any further questions at this time. I’d like to turn the call back over to Daniel Barber, CEO, for any closing comments.

Dan Barber: Thanks, Kevin. Thank you for joining us this morning. As you heard today, we’re incredibly excited about the progress the company has made, and we believe we are well-positioned for a successful 2025. We look forward to the next time we interact. And with that, I wish all of you a wonderful day.

Operator: Thank you. Ladies and gentlemen, this does conclude today’s presentation. You may now disconnect, and have a wonderful day.