Aquestive Therapeutics, Inc.

Good morning, and welcome to the Request of Therapeutics third quarter 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. To ask a question during the session, you will need to press star 1 on your telephone. As a reminder, this call will be recorded. I would now like to introduce your host for today's conference, Ms. Stephanie Carrington, Westwick Investor Relations. You may begin.

Thank you, Operator. Good morning and welcome to today's call to review Equestive Therapeutics results for the third quarter 2019 and business highlights. On today's call, I am joined by Keith Kendall, Chief Executive Officer, and John Maxwell, Chief Financial Officer, who are going to provide an overview of recent business developments and performance in the third quarter. Additional members of our leadership team will be available for Q&A. In total, we expect today's call to last approximately 60 minutes. As a reminder, our remarks today correspond to the earnings release we issued after market close yesterday. In addition, a recording of today's call will be made available on Equestive Therapeutics' website within the investor relations section shortly following the conclusion of this call. To remind you, we will be discussing some non-GAAP financial measures this morning as part of our review of third quarter 2019 results. The description of these measures, along with a reconciliation to GAAP, can be found in the earnings release we issued yesterday, which is posted to the Investors section of Equestive Therapeutics' 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 included in the company's annual report on Form 10-K filed with the SEC on March 14, 2019 and in our quarterly reports on Form 10-Q. As with any pharmaceutical company with product candidates under development and products being commercialized, there are significant risks and uncertainties with respect to our business and the development regulatory approval and the commercialization of our 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 Equestria Therapeutics or any person acting on our behalf are especially 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 a result of new information, further events, or otherwise, except as required under applicable law. With that, I'll now turn the line over to Keith.

Thanks, Stephanie, and thanks to everyone on the call for joining us this morning as we discuss a number of important developments in our business during the third quarter and through October. John and I are going to walk through some details in our remarks today, and we'll then be joined by additional members of the Equestive Leadership Team during the Q&A session afterward. The third quarter was an important and successful quarter in the evolution of Equestive. We have, as previously committed, completed our proof-of-concept study for epinephrine, Equestive 108, for the treatment of allergic reactions, including anaphylaxis. and have requested a pre-IND meeting with the FDA. We have continued to grow Simpazan more than 50% since the end of the last quarter and successfully completed the FDA-requested crossover study of Librovan in patients against the reference-listed rectal gel. Let's discuss in more detail each of these key areas of focus for the company. First, let's talk about Equestiv-108. In late September, as promised, we completed the Phase 1 proof-of-concept clinical trial for Equestive 108, our sublingual film formulation delivering systemic epinephrine. The proof-of-concept data demonstrated our ability to deliver systemic epinephrine via our farm film formulation. Notably, we achieved similar ranges of mean values of Cmax and Tmax to that reported for injectables EpiPen, and Avi Q. Last week, we submitted our request to the FDA for a pre-IND meeting. We're waiting for feedback from the agency regarding potential dates for this meeting to discuss the development pathway for Questive 108. At this juncture, we anticipate this meeting will be scheduled for the early part of 2020. The central focus of our company at this time is our CNS franchise. As you all know, we launched Simpazan at the very end of last year. Simpazan is a product we believe will ultimately generate $65 million of peak annual net sales. Simpazan has a meaningful value proposition for caregivers of patients suffering from Lennox-Gastaut syndrome, or LGS. Simpazan also represents a significant step forward in establishing our commercial infrastructure and raising the profile for Equestiv's technology as we continue to drive toward an ultimate approval and launch of LibraVan. We launched Simpazan, whose prescribers overlap greater than 90% with potential prescribers of LibraVan, late last year with the aim of raising the profile of our farm film technology. Sipazan was developed and launched as a commercial precursor and eventual complementary product in support of the LibraVant opportunity. Sipazan gave us the opportunity to build out and pressure test our commercialization capabilities and processes prior to the commercial launch of LibraVant. All of our commercialization efforts relating to Simpazan provide an opportunity for direct conversations with healthcare practitioners, patients, caregivers, advocacy groups, and others about the value of the farm film technology that will be the basis for LibraVan. On a sequential quarterly basis, we continue to be focused on the growth and further market penetration of Simpazan. The latest monthly Simpazan shipment volumes to retailers has grown over 50% since the end of the second quarter. The prescribing base also continues to grow, over 56% since the second quarter, with over 83% of prescribers writing multiple scripts and over 70% of the patients refilling their scripts. Additional contracts with payers and PBMs were signed since the second quarter, and we continue to expect to achieve our goal of having over 70% of lives covered by the end of the year. Simpazan is strategically accomplishing what was intended when we developed and launched the product last year. The work we do to continue to build the revenue stream and market penetration for Simpazan will be an important foundation for the successful launch of LibraVant, expected in 2020. The company's efforts are most sharply focused on bringing LibraVant to market. LibraVant represents a major contribution to patient care for the treatment of seizure clusters in patients with epilepsy. and we believe will potentially contribute up to $200 to $300 million in peak net revenues. Over 1 million patients in the U.S. have active, uncontrolled epilepsy and a need for rescue medication. Less than 10% of these patients are successfully treating their seizures with the current standard of care, a rectal gel application of diazepam. A medicine is only as good as its ability to be used by patients where they need it, when they need it, and in a form they accept. As we announced previously during the third quarter, we successfully completed the single-dose crossover study for Librovan. We believe that we've met the specific requirements for approval communicated to us by the FDA and and our product continues to prove that it has attributes lacking in all other current or pending formulations of diazepam. As shown in the recently completed crossover study trial comparing Libervant with the rectal gel in patients, the peak blood concentration of diazepam following buccal film administration was comparable to that of diazepam rectal gel. Also, the performance of the film measured by peak concentrations was more consistent across weight categories compared to the performance of the rectal gel. Importantly, the data continued to show that there were no non-responders to Libervant. The rectal gel, however, continued to show, as it has historically, low and non-responders of 10% or more in our latest study. This is a critical milestone for our lead asset and puts us on a clear and straightforward path to completing the filing of our NDA for Liberman. We filed the CMC portion of the rolling new drug application submission with the FDA in September. We expect to file the clinical data portion around the end of November, which will mark the completion of our submission. Assuming a 10-month review cycle, we are anticipating receiving a PETUFA Gold date around the end of the third quarter of 2020. We believe that LibriVant will become the preferred rescue medication by patients and providers looking for an alternative, potentially superior, and clinically differentiated treatment to manage and interrupt seizure clusters. This is based on strong data that shows the product can be quickly, and Safely Applied results in consistent therapeutic levels and comes in a form preferred by patients. Based on patient survey data, LibriVant is preferred by 80 plus percent of patients when compared to nasal sprays. Once approved by the FDA, LibriVant will be the only treatment option usable by and delivering a consistent, predictable dose to virtually all patients to whom it's prescribed. We plan on having a strong presence at the American Epilepsy Society annual meeting in Baltimore in early December. We have multiple poster presentations, and we're planning to hold an investor and analyst R&D event on December 9th that will feature a handful of key opinion leaders in the epilepsy field. Moreover, we're sponsoring a scientific exchange meeting at AES the morning of December 9th for clinicians and others to learn more about LibraVant and the expanded clinical data set that we'll be showcasing at the meeting. We believe AES is one of the most important epilepsy conferences of the year. With the imminent filing of LibraVant, we believe this is an important event for us to showcase our technology and product offerings. Finally, in line with our expectations, Exervan, our farm film formulation of Rilazole for ALS, continues to move toward a November 30th PDUFA date. As we've said previously, we're seeking to license the product outside the United States, and we've begun the process of identifying potential commercial partners in the U.S. as well. Looking ahead for the remainder of 2019 and into 2020, We are focused on advancing our proprietary products. We will continue to grow Simpazan shipments and revenue while establishing strategic relationships for us in the epilepsy market in advance of a LibraVant launch. And we expect to complete the NDA filing for LibraVant around the end of November, as I said before, and continue the regulatory process through the early part of 2020. We look forward to continuing to update you as we make progress on these key deliverables during the remainder of the year and in the early part of 2020. I'll now turn the line over to John Maxwell, who provides specifics of our financial performance and outlook.