Aquestive Therapeutics, Inc.

Good morning and welcome to the Questive Therapeutic second quarter 2024 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 1 on your telephone. You will then hear an automatic message advising your hand is raised. As a reminder, this call will be recorded. I would now like to introduce your host for today's conference call, Bennett Watson of ICR West Investor Relations. You may begin.

Thank you, operator. Good morning and welcome to today's call. On today's call, I am 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 second quarter 2024, followed by a Q&A session. During the Q&A session, the team will be joined by Dr. Carl Cross, Chief Medical Officer, Dr. Stephen Wargacki, Chief Science Officer, and Sherry Corgenti, Senior Vice President of Sales and Marketing. As a reminder, the company's remarks today correspond with the earnings release that was issued after market close yesterday. In addition, a recording of today's call will be made available on Equestria's website within the Investors section shortly following the conclusion of this call. To remind you, the Equestiv team will be discussing some non-GAAP financial measures this morning as part of its review of second quarter 2024 results. The description of these measures, along with the reconciliation to GAAP, can be found in the earnings release issued yesterday, which is posted on the Investors section of Equestiv's website. During the call, the company will be making forward-looking statements. We remind you of the company's safe harbor language as outlined in yesterday's earnings release, as well as the risks and uncertainties affecting the company, as described in the risk factors section and in other sections included in the company's quarterly report on Form 10-Q filed with the Securities Exchange Commission on August 6, 2024. 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 Equestria 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 assumed 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. With that, I will now turn the line over to Dan.

Thank you, Bennett. On the heels of our successful equity raise in the first quarter, we had a very eventful second quarter. We progressed our antifilm epinephrine sublingual film program gained FDA approval of LibriVent Dizepam Buccal Film for the two to five-year-old age group, streamlined our base business to focus on growth, and continued to expand our LibriVent launch efforts for epilepsy patients aged between two and five years. As usual with Equestiv, this was an action-packed 90 days. Starting with Anafilm, our momentum continues to build When I look at the competitive landscape for anafilm, I remain more optimistic than ever. With the potential to be the first and only oral epinephrine product for the treatment of severe allergic reactions, including anaphylaxis, we believe anafilm easily fits within the patient's daily life due to its highly differentiated product attributes. On past earnings calls, I have focused on some of these important attributes, such as ease of carrying and ease of use. Today, let me expand on an additional area of differentiation. Let's talk about the durability of rescue products in the real world. You see, approved epinephrine medical devices, such as auto-injectors, come in liquid form and are largely made up of water. Products composed largely of water are subject to degradation in real-world conditions like high temperatures. That is one of the main reasons that EpiPens have such strict storage instructions, as they may no longer be effective if they are left on a soccer field in summer heat for an extended period of time. We estimate that 98% of the EpiPen formulation is water. Now think about anafilm. Only 2% of the anafilm product is composed of water. As we have seen with our other products over the last two decades, oral films are different. Anafilm's low water content means it has the potential to remain stable even after long durations of heat exposure. It means anafilm has the potential still work in freezing temperatures. It means antifoam has the potential to work in a broad spectrum of real-world conditions, which we do not believe can be matched by any other existing or pipeline product in this category. Now, turning to our development progress, we have successfully completed two of the three supportive studies necessary for engaging the FDA in a pre-NDA meeting. These are our temperature pH study and self-administration study. In both cases, as we have already shared publicly, the top-line data was positive. The third study, our oral allergen challenge study, is currently in the clinic. We are advancing our enrollment of the patients needed for the study and expect completion of the study late in the third quarter or early in the fourth quarter of this year. We continue to anticipate holding a pre-NDA meeting in the fourth quarter and starting our pediatric study immediately afterwards. Once the pediatric study has completed, we will file our NDA. At this time, we expect to begin our NDA submission in December and complete the submission in the first quarter of 2025. Based on FDA approval, our timing for a full launch at the end of 2025 or in the first quarter of 2026 remains unchanged. Our commercial launch activities remain on track. We now have in place very experienced leadership over both our commercial and medical affairs efforts for NFL. The team is focused on increasing awareness among physicians, payers, and the advocacy community. Across this entire stakeholder universe, we are hearing that Anafilm is the answer to address the significant unmet needs of healthcare providers, patients, and their caregivers. Even though other alternative medical devices may be on the horizon, there is nothing like Anafilm. No needle, no device, oral administration, Anafilm is easy to carry and keep everywhere you go, whether you are headed to the beach or the soccer field. There's no need for a carrying case. Anafilm fits on the back of your phone or easily in a wallet and is durable enough to withstand the real-life activities of patients, all while potentially improving the carry rate for patients. Our data suggests Anafilm is not impacted by comorbid allergic diseases such as congestion, atopic dermatitis, and asthma. Antifilm remains highly differentiated and poised to positively disrupt rescue treatment for severe allergic reactions, including anaphylaxis. As we get closer to filing and launch, we have had multiple inbound inquiries from companies interested in helping us distribute antifilm. Our goal is to maximize the distribution of antifoam to all patients immediately if approved by the FDA. Over the next year, we will continue to examine if our commercial efforts can be augmented by utilizing the sales and distribution platforms of other companies. Speaking of commercialization, let's turn to LibraVent. We are now focused on expanding our LibraVent launch in the two to five-year-old age group. Over the last few months, we have received significant feedback on the value and benefits LibraVent offers to patients and their caregivers. This feedback includes outreach from major children's institutions across the country who are proactively seeking information on LibraVent. We expect to have national retail distribution capabilities in place by October 1st while continuously improving our commercial and Medicaid coverage through the fourth quarter. We will expand to a national sales team of 10 representatives in late Q3. We believe expanding our sales team for Lieberman for the two to five-year-old age group will result in minimal single-digit millions in cash burn in 2025 and will generate top-line revenue in 2025 to be somewhere in the neighborhood of $5 million. While that may seem modest in the short term, there is significant benefit to the company as we prepare for an anafilm launch in 2026, if approved, and a full LibriVent launch in 2027 on the expiration of a competitor's orphan drug exclusivity. We continue to see the long-term potential for LibraVent as a brand with over 100 million in peak annual net sales. And we look forward to our sales expansion for the two- to five-year-old age group in the weeks to come. Now let's turn to our Adreniverse epinephrine prodrug platform. As promised, we are preparing to share more with the investor community on the future pipeline potential of Adreniverse. As you may recall, Anafilm was born out of our Adreniverse platform technology. We believe there are additional major products that will come from this platform. In the next few months, we will hold an investor day to outline how Anafilm has helped propel our scientific thinking, the science behind our Adreniverse platform, our unique intellectual property position, and the potential products that could arise from the work we have done. This is an exciting part of our business. Finally, on our base business, we have completed our strategic review of our existing collaborations and eliminated our unprofitable relationships. This includes no longer focusing on China, as well as terminating our U.S.-based partnership with the distribution of Exervin Rilazol Oral Film. In 2023, Equestria's revenue from Exurban was negligible. Ernie will provide more details on revenue in a moment. Eliminating these distractions will allow the executives responsible for our base business to focus on products such as Suboxone with Indivior, Amylif with Zambone, Symphazin with Assyrdio, and Ondif with Hypera, while also preparing for higher volumes of LibraVent and the launch of Anafilm, if approved. In conclusion, we continue to be a company with incredible growth potential. Our lead pipeline program, Anafilm, for severe allergic reactions, including anaphylaxis, is nearing the end of its development cycle and we believe is only months away from filing. Our commercial product, LibraVent, affords us the opportunity begin commercialization in a low-risk, low-cost environment while still retaining significant long-term potential. Our Adreniverse platform gives us a unique intellectual property position that can generate meaningful programs for years to come, and our base business continues to be a meaningful part of our story. With that, I will turn the call over to Ernie.