Aytu BioPharma, Inc.

Good day, everyone, and welcome to the A2 Biopharma Fiscal 2026 Second Quarter Earnings Call. At this time, all participants are placed on a listen-only mode, and we will open the floor for your questions and comments after the presentation. It is now my pleasure to hand the floor over to your host, Robert Bloom. Sir, the floor is yours.

All right. Thank you very much, and good afternoon, everyone. As the operator indicated during today's call, we will be discussing... A2 Biopharma's fiscal 2026 second quarter operational and financial results for the period ended December 31, 2025. Joining us on today's call is A2's chief executive officer, Josh Disbrow, and Ryan Selhorn, the company's chief financial officer. At the conclusion of today's prepared remarks, we'll open the call for a question and answer session. I'd like to remind everyone that today's call is being recorded. A replay of today's call will be available by using the telephone numbers and conference ID provided in the press release issued earlier today or by utilizing the link on the company's website under events and presentations. Finally, I'd also like to call your attention the customary safe harbor disclosure regarding forward-looking information. The conference call today will contain certain forward-looking statements, including statements regarding the goals, strategies, beliefs, expectations, and future potential operating results of A2 Biopharma. Although management believes these statements are reasonable based on estimates, assumptions, and projections as of today, these statements are not guarantees of future performance. Time-sensitive information may no longer be accurate at the time of any telephonic or webcast replay. Action results may differ materially as a result of risks, uncertainties, and other factors, including but not limited to the factors set forth in the company's filings with the SEC. A2 undertakes no obligation to update or revise any of these forward-looking statements. With that said, let me turn the call over to Josh Tisbro, Chief Executive Officer of A2 Biopharma. Josh, please proceed.

Thank you, Robert, and welcome, everyone. I'm excited to be speaking with you on what is truly a momentous time for A2 as we just commercially launched Exua, the first and only 5-HT1A agonist approved by the FDA for the treatment of MDD, representing a truly novel way to treat MDD. As many of you are aware, we held an investor day back on January 20th, where we spent the better part of two hours diving into all things Exua. If you weren't able to attend in person or part of the live broadcast, please know that a replay is available on our website under the investor relations page, and I certainly encourage everyone to take a listen. Given the deep dive we just did two weeks ago, let me spend a few minutes summarizing a few of the key discussions that occurred during the event. which were really divided between understanding the 5-HT1A receptor and its clinical importance in major depressive disorder, along with the unmet treatment needs and their implications for antidepressant treatment selection in NDD. And further, actually, it was clinical trial data, including efficacy and safety, and some in-depth elements of our commercial launch strategy. First, on the clinical side, Dr. Stephen Stahl, an internationally renowned clinician, researcher, and teacher in psychiatry with subspecialty expertise in psychopharmacology, discussed how the current standard of care for major depressive disorder has largely relied on SSRIs and SNRIs, which work by broadly increasing serotonin levels in the synapse and non-selectively activating multiple serotonin receptor subtypes. While these therapies can provide symptom relief, that lack of selectivity is believed to drive many of the well-known limitations of reuptake inhibitors, including treatment of emergent sexual dysfunction, insomnia, anxiety, appetite changes and weight gain, and other off-target side effects that can impact tolerability and patient adherence. In contrast, Exuo represents a fundamentally different, more targeted approach, specifically designed to engage the 5-HC1A receptor, which is thought to be central to antidepressant efficacy. Exua acts as a full agonist at presynaptic 5-HT1A autoreceptors to enhance serotonergic signaling and as a selective partial agonist at postsynaptic 5-HT1A receptors without any significant activity at receptors associated with sexual side effects or weight gain. This differentiated mechanism has potential implications across key brain regions involved in mood, anxiety, cognition, and stress, thus reinforcing our belief that Exua offers a novel and clinically meaningful advancement in the treatment of MDD. Next, Dr. Anita Clayton, who has focused her clinical practice and research on multiple psychiatric areas of unmet need, including major depressive disorder, in which she has been a principal investigator for essentially all the new antidepressants approved since 1991, highlighting how major depressive disorder remains a significant and growing public health challenge, affecting an estimated 21 million U.S. adults, with nearly 15 million experiencing severe functional impairment. Despite the widespread use of first-line SSRIs, 50% to 60% of patients fail to achieve remission, and even among those who do, many never fully recover key aspects of daily functioning, such as cognition and workplace productivity. Nearly half of patients ultimately discontinue their initial therapy, often driven by tolerability issues, most notably sexual dysfunction and weight gain, which affect a substantial portion of patients on traditional antidepressants. Against this backdrop, she discussed the important clinical implications for Exua, which does not carry a warning for sexual dysfunction and demonstrated a neutral sexual profile in clinical studies with no sexual-related adverse event rates exceeding placebo and showed no clinically meaningful weight gain compared to placebo across pivotal trials. These attributes position Exua as a truly differentiated option that directly addresses some of the most persistent unmet needs in the treatment of MDD. Finally, Dr. Christoph Karel, who annually is listed as one of the most influential scientific minds and among the top 1% cited scientists in psychiatry, discussed how Exua's Phase III clinical program demonstrated meaningful efficacy and a well-defined safety profile in adults with major depressive disorder. I once again, on this call, thank these three esteemed members of the psychiatry community for their participation and, again, encourage everyone to listen to their commentary on Exua. Okay, now let's turn to the commercial launch plans for Actua, which is being executed upon with a clear balance of efficiency and comprehensiveness with a focus on driving prescriber adoption and long-term brand growth. The core of this effort is a highly motivated and incentivized sales organization supported by metrics-based performance management, incentive-driven territory growth, and a strong sense of urgency around execution. In addition to our internal sales team, we are augmenting our reach through scalable and efficient initiatives, including a virtual sales team designed to broaden awareness and generate early customer leads, as well as a rolling contract sales organization model that allows us to flex in-person promotion in line with product performance and as profitability and cash flow allow. Our promotional strategy is intentionally targeted, yet broad in scope, combining both personal and non-personal approaches to maximize impact. From a non-personal standpoint, we are deploying a focused, compliant, media-based consumer promotion strategy while ensuring our Salesforce efforts remain concentrated on the highest value psychiatry practices. Targeting has been informed by detailed customer profiling and direct Salesforce input, prioritizing high-volume antidepressant prescribers, prescribers with a demonstrated propensity to adopt branded therapies, and physician practices already familiar with A2 through our ADHD portfolio and the RxConnect platform. The early wins we're seeing reinforce our confidence that this focused approach is resonating in the field. Patient access is a critical pillar of the actual launch, supported by our best-in-class A2 RxConnect platform, along with full retail distribution through national wholesalers to ensure nationwide pharmacy availability. RS Connect was purpose-built to remove uncertainty and friction for patients and prescribers by guaranteeing predictable coverage for commercially insured patients, thus minimizing administrative burden and capping patient out-of-pocket costs at no more than $50 per prescription for Exua, again, for all commercially insured patients. Importantly, patients also retain the flexibility to fill prescriptions outside the RS Connect network when preferred, ensuring broad access and choice for all patients. Finally, medical education and scientific engagement will underpin sustainable adoption. Our medical affairs team is rapidly expanding a robust KOL network and executing an active publication and medical meeting strategy as Exua enters its first full year of commercial availability. Insights from more than 1 million prescriptions spilled through RxConnect continue to guide our payer contracting strategy, covering approximately 60% of commercially insured MDD patients. with encouraging early coverage across Medicaid and Medicare populations. Overall, the Exua launch is highly focused, data-driven, and designed to scale intelligently over time, aligning promotional investment with performance and cash flow to support durable growth. As we are really only a couple or a few weeks into launch at most, the availability of data is sparse, but let me share a couple of data points we do have, which is largely derived from our insights from the RxConnect platform. To date, scripts for Exua have been written from 27 states, including numerous states where we don't have sales reps, thus highlighting the very broad opportunity. Over 100 doctors have prescribed Exua to date, which is exciting. With us just over 30 days since Exua was first made commercially available, we're in fact already seeing our first set of refills come through the platform. And perhaps most importantly, the early feedback from patients on Exua has been very good. While only a small number of patients have been on Exuo for a month or longer, they're reporting good tolerability and satisfaction with the product. So all signs are positive in the early days here post-launch. And to say the least, we are extremely excited to have Exuo fully underway in launch mode and even more encouraged by the... While it's still very early, our efficient yet comprehensive launch strategy is unfolding as planned. Our sales team is exceptionally well-prepared, Our KOL network continues to expand, and we are already seeing validation of our commercial approach. I look forward to being able to share more with you in the quarters to come. Let's transition for a moment now to our ADHD portfolio. For the quarter, ADHD net revenue was $13.2 million, and this was just a slight decrease from the year-ago period and flat compared to Q1. Quite impressive, in my opinion, given the evolving dynamics of Salesforce prioritization now geared towards Exua, and the recent introduction of generic competition. The evolution of the ADHD portfolio continues to perform above what I'll call standard expectations, given similar circumstances, and we feel very good about the long-term prospects of the ADHD portfolio, given the protections afforded by RxConnect. As we previously discussed, Teva did, in fact, launch their ANDA for Zenith back in mid-December, The early data on Scripps continues to reinforce our long-term conviction in the enhanced stickiness and attractive economic value of the A2Rs Connect platform, through which, again, I'll remind you, approximately 85% of our branded ADHD prescriptions are dispensed. The launch of our own Adzenis authorized generic has also served to limit the impact to date of the Teva generic. For the six-week period ending January 16th, the Teva generic accounted for approximately 5% of prescriptions written. Over that same period, our authorized generic of Adzenis represented just under 20% of total prescriptions, with the remaining volume continuing to be branded Adzenis. While we do expect some continued transition from the brand to generics, as we de-emphasize our ADHD portfolio in favor of Exua, we do believe that any incremental non-A2 generic volume will largely come from the roughly 15% of the prescriptions dispensed outside the RS Connect platform in the near term, as we expect relatively little erosion within the network. We've also taken a recent price increase, which will help to offset any script erosion via net pricing improvements we've seen over time. While time will ultimately tell, we believe the dynamics here will differ meaningfully from many comparable situations, and we do not expect the typical erosion trajectory to fully materialize in the way other brands have seen. Quickly, on our pediatric portfolio, before I turn it over to Ryan to review the financials in more detail, we saw a nice uptick in net revenue from the fiscal 26 first quarter to our fiscal second quarter, coming in at $1.7 million compared to $715,000 in Q1. Part of this relates to reduced quantity of returns we experienced last quarter, while we also saw relative stabilization of prescriptions. To be clear, given the broader commentary from the FDA around fluoride and to prioritize our largest growth driver, we, of course, continue to focus the bulk of our resources on Actua. If there are changes with respect to the FDA, our approach may change, but to this point, our legacy pediatric products remain non-core for the company as we go forward. So with that, let me turn the call over to Ryan to go into more detail on the financials, and I'll make a few closing comments, and then we'll look to address any questions you might have. Ryan?