Palatin Technologies, Inc.

Welcome to Palatin's third quarter fiscal year 2023 operating results conference call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. Before we begin our remarks, I would like to remind you that statements made by Palatin are not historical facts and may be forward-looking statements. These statements are based on assumptions that may or may not prove to be accurate and that the actual results may differ materially from those anticipated due to the variety of risks and uncertainties discussed in the company's most recent filings with the Securities and Exchange Commission. Please consider such risks and uncertainties carefully in evaluating these forward-looking statements by Palatine's prospects. Now I would like to turn the call over to Dr. Carl Spana, President and Chief Executive Officer of Palatin. Please go ahead.

Thank you, good morning, and welcome to the Palatin Third Quarter Fiscal 2023 Call. I'm Dr. Carl Spana, CEO and President of Palatin. With me on the call today is Steve Wills, Palatin's Executive Vice President, Chief Financial Officer, and Chief Operating Officer. I will now turn the call over to Steve, and he'll give the financial and operating updates. Steve. Thank you, Carl.

Hello, everyone. Regarding financial highlights, I'll start with Vyleesi, and Vyleesi is our FDA-approved commercial product for premenopausal women with hypoactive sexual desire disorder, or HSDD. The goal of the Vyleesi program is to demonstrate commercial product value in the marketplace with an objective of licensing the U.S. rights to a committed women's healthcare company. For the third quarter, and in March 31, 2023, Gross product sales were $3.4 million, an increase of 31% over the prior quarter, and an increase of 165% over the comparable quarter last year. Net product revenue of $1.2 million increased 16% over the prior quarter and increased 453% over the comparable quarter last year. Total prescriptions dispensed increased 27% over the prior quarter and increased 147% over the comparable quarter last year. We have achieved five consecutive quarters of double-digit growth. Refill rates, commercial insurance reimbursement, and net revenue per prescription dispense continued with positive and impactful results and trends versus the prior quarter and comparable quarter last year. We are particularly pleased that Vileci's quarterly net product revenue exceeds Vileci's quarterly operating expenses. Yep, that means we are not losing any money on Vileci. Also, we were issued a patent titled Use of Bremel Anitide in Patients with Controlled Hypertension with a term through April 29, 2041. Regarding other Palatin did receive $4.7 million in January 2023 from the State of New Jersey's Technology Business Tax Certificate Transfer Program sponsored by the New Jersey Economic Development Authority. Moving over to the actual financial operating results for the third quarter ended March 31, 2023. Regarding revenue, total revenue consists of gross product sales of by leasing, net of allowances and accruals, and license and contract revenue. I covered the V revenue, ILECE revenue numbers prior. Regarding operating expenses, total operating expenses were $8.5 million compared to $8 million for the comparable quarter last year. The increase in operating expenses was mainly the result of higher spending on our marketing efforts of ILECE. Regarding cash flows, Palatin's net cash used in operations was $1.4 million compared to net cash used in operations of $9.5 million for the same period last year. The decrease in net cash use and operations is mainly due to the company's receipt of proceeds from the state of New Jersey, NOL, stands for Net Operating Losses, and working capital changes for the quarter ended March 31st, 2023. Regarding net loss, Palatine's net loss was 7.1 million, or 63 cents per basic and diluted common share, compared to a net loss of 7.6 million, or 80 cents per basic and diluted common share, for the comparable quarter last year. The decrease in net loss of the comparable quarter last year was mainly due to an increase in net product revenue by LISI of $1 million, offset by an increase in operating expenses of approximately $500,000. Regarding Palatine's cash position, as of March 31st, 2023, cash and cash equivalents were approximately $19.6 million, plus approximately 1.7 million of accounts receivable. This was compared to cash and cash equivalents of 21.2 million with 6.5 million of accounts and other receivables as of December 31st, 2022, and 29.9 million with 1.8 million of accounts receivable as of June 30th, 2022. Based on our current operating plan, we believe that existing cash and cash equivalents and receivables will be sufficient to fund currently anticipated operating expenses through calendar year 2023. And I'll turn the call back over to Carl.