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Operator
Ladies and gentlemen, and welcome to the Catalyst Pharmaceutical Incorporated Third Quarter 2022 Financial Results Conference Call. All lines have been placed on the listen-only mode, and the floor will be open for questions and comments following the presentation. If you should require assistance throughout the conference, please press star zero on your telephone keypad to reach a live operator. At this time, it is my pleasure to turn the floor over to your host, Ali Grande, Chief Financial Officer. Ma'am, the floor is yours.
Ali Grande
Good morning, everyone, and thank you for joining our conference call to discuss Catalyst's Third Quarter 2022 Financial Results and Corporate Highlights. Leading the call today is Patrick McEnany, Chairman and Chief Executive Officer. We are also joined by Dr. Stephen Miller, our Chief Operating Officer and Chief Scientific Officer, and Jeffrey Del Carmen, our Chief Commercial Officer. Further, for the Q&A session, we will also have Dr. Gary Ingenito, our Chief Medical and Regulatory Officer. Before we begin, I would like to remind you that in the following comments and in the Q&A session, we will make statements about expected future results, which may be forward-looking statements for purposes of federal securities laws. These statements relate to our current expectations, estimates, and projections, and are not guarantees of future performance. They involve risks, uncertainties, and assumptions that are difficult to predict and may prove not to be accurate, especially in light of the continued effects of COVID-19. Actual results may vary from the expectations contained in our forward-looking statements. The forward-looking statements should be considered only in conjunction with the detailed information contained in our SEC filings, including the risk factors described in our 2021 and will report on Form 10-K. At this time, I will turn over the call to Pat.
Patrick McEnany
Thanks, Allie. Good morning, everyone, and thank you for joining us today on our third quarter 2022 financial results and corporate update call. We are incredibly proud to report our outstanding third quarter financial results, which marks another consecutive quarter of FERDAP's revenue growth in an all-time high recorded quarterly net product revenue of $57.2 million, representing a 59.3% increase over the third quarter of 2021. We reported GAAP net income of $22.7 million for the third quarter of 2022, or 22 cents per basic share and 20 cents per share per diluted share, which also reflects a $4.6 million charge in the third quarter related to the accounting treatment for the write-down of the Resurgy inventory and the amortization expense related to the acquisition of certain assets from Jacobus Pharmaceutical Company. Our non-GAAP net income for the third quarter was $28.6 million, or 28 cents per basic share and 26 cents per diluted share. Non-GAAP net income removes from our GAAP net income our non-cash stock-based compensation and depreciation and amortization and our income tax provision. Allie will have much more to say about the accounting treatment and the impact on our P&L as a result of the acquisition of certain Jacobus assets during her presentation. We enter the fourth quarter. with further confidence that we are on the right path to achieving our 2022 objectives and goals. In the month of October, we matched our best month for new enrollments in Catalyst Pathways, and as a result, we are revising upward our full-year 2022 FERDEP's revenue guidance to $205 to $210 million. Our 2022 financial guidance for cash OPTX of $65 to $70 million remains intact and will exclude the impact of any strategic acquisitions. Our cash position continues to grow as we enter the third quarter of 2022 with $256 million in cash and short-term investments. This is a $35.3 million increase in 2022 third quarter over the prior quarter amount and represents the largest quarterly increase in cash and short-term investments to date, which further demonstrates our continued fiscal discipline. Please keep in mind that this is after paying the $10 million initial payment to Jacobus for acquiring the rights to certain of their assets early in the third quarter. Also, our share repurchase program is currently on hold. as we are conserving cash for expected business development activities. As you know, approximately 50% of patients with limbs suffer with a comorbidity of small cell lung cancer. We've commenced a soft rollout of our new marketing initiative to reach and teach thoracic oncologists and others in the physician community to treat small cell lung cancer about limbs. These programs represent a large untapped opportunity for us to help oncologists identify limbs early and thus get their patients on drugs sooner for hopefully a better quality of life. Our new oncologist targeted programs will hit the ground full speed at the beginning of next year. Jeff will have more to say about these programs in a few minutes. Early in the third quarter, we achieved a global settlement of all U.S. litigation involving Jacobus Pharmaceuticals as part of the acquisition of certain Jacobus assets. With the acquisition of the Resurgy assets completed, our team is actively assessing the path forward for the product. In the meantime, we continue to provide the existing Resurgy inventory to patients receiving treatment for neuromuscular conditions other than limbs who were previously receiving the drug under existing investigator-sponsored INDs. The long-term prospects for Resurgy are being evaluated, which involve many complex issues related to manufacturing, regulatory, cost, and financial feasibility. As part of the acquisition, we added two more patents to our intellectual property portfolio. With an additional patent listed in the orange book, with an expiration date of February 2037, bringing the total number of U.S. patents listed in the orange book to six. We also announced the receipt in the third quarter of the U.S. approval of the supplemental new drug application for PRDAPs, expanding the indicated age range to include pediatric patients six years of age and older for the treatment of limbs. While this patient population is estimated to be less than 30 pediatric patients in the U.S., this milestone demonstrates our continued commitment to the LIMS patient community that we serve. During the third quarter, we made significant strides in our efforts to identify acquisition opportunities towards building a diversified patient-centric portfolio aligned with our overarching growth strategy. Our key priority on the strategy and business development front continues to remain our intention to broaden and diversify our product portfolio through collaborative partnerships, acquisition of commercial stage assets or companies. Currently, we are in advanced stages of due diligence to acquire commercial stage products and or companies. And while no agreements have been reached to date, We are hopeful that we will be in a position to announce a transaction later this year. We recently advanced our Environmental, Social, and Governance, or ESG, initiatives with the launch of the comprehensive assessment of key ESG topics to identify appreciable targets for our sustainability activities. These efforts will serve as the foundation for our initial sustainability report, which we anticipate will be published in the first half of 2023. Just this week, we announced the catalyst was named Company of the Year by Bio Florida. This recognition was for the achievement of significant milestones and to the growth of Florida's life science industry. We are honored to have been recognized for our many accomplishments, which is a testament to the entire Catalyst team for their dedication and hard work. In addition, we were recently ranked number 39 in Fortune Magazine's 2022 top 100 fastest-growing companies. This ranking is based on the company's growth in revenues, profits, and stock returns over the three-year period through June 30th of 2022. for which we achieved 176% growth during that period. On September 15th, we were added to the S&P Small Cap 600 Index. The S&P Small Cap 600 Index is a stock market index established by Standard & Poor's. It covers roughly the small cap range of U.S. listed stocks. using a capitalization weighted index. To be included in the index, a stock must have a total market cap that ranges from $850 million to $3.7 billion. As we entered the fourth quarter with sustained momentum, we are well positioned to continue to execute our strategic priorities to strengthen the business with opportunities that translate into added long-term value and growth for our stakeholders. We are excited by the direction in which we are headed and expect to close out the year on a high note. I'd like to thank all of our valued Catalyst team members, as well as the LHINs patients and physician community that we serve. I'll now turn the call over to Jeff Del Carmen, our Chief Commercial Officer, who will further highlight our commercial performance.
Allie
Jeff Del Carmen Thanks, Pat, and good morning, everyone. We are pleased with the tremendous results delivered in Q3, building upon the momentum from the first half of the year. Q3 Ferdapp's net sales were 57.2 million, which represents 8% growth quarter over quarter and 59.3% growth quarter versus same quarter last year. I'm proud of the ongoing flawless execution demonstrated by the entire commercial organization. Q3 results reflect continued strong organic growth. New enrollments exceeded forecasts, resulting in 85% more net new patients in Q3 than Q2. Additionally, the discontinuation rate of reimbursed patients in Q3 was 35% lower than Q2. Operational excellence maintained favorable access to greater than 90% across all payers, government or private commercial insurers, continued high compliance of greater than 90% and contributed to an annual discontinuation rate of less than 15%. Patients enrolled in Catalyst Pathways, including those who are covered by Medicare and accessing foundation assistance, had an average copay of less than $2 per month. As Pat mentioned, we have raised our total revenue guidance to between $205 million and $210 million. we are confident that we will continue to sustain organic growth moving forward, primarily driven from new patient enrollments of already diagnosed LEMS patients not yet on FERDAPs, as well as a significant number of patients that are unfortunately misdiagnosed or undiagnosed. Leading indicators thus far in Q4 are very positive. October naive new patient enrollments matched our highest total post-launch, while discontinuations were lower than forecast. Our targeted marketing strategies enable us to maintain close to 500 leads that are diagnosed LEMS patients not yet on FERDAPs, as well as educate healthcare providers, patients, and caregivers about LEMS and FERDAPs. Focus on these leads results in approximately 50% of new enrollment each month. and accelerates the opportunity for these LEMS patients to be treated with VirDaps when appropriate. Additionally, analysis of data from national laboratories indicates at least a 50% increase in voltage-gated calcium channel antibody tests in 2022 versus 2021, which further validates our efforts to shorten the diagnostic journey for LEMS patients is working. Another opportunity for organic growth is the approximately 50% of cases of LEMS that are associated with an underlying cancer, typically small cell lung cancer. Significant resources have been allocated this year to educate thoracic oncologists about LEMS and FERDFs through non-personal promotion and conference engagement. We estimate that there are approximately 1,500 small cell lung cancer LEMS patients in the United States. Data suggests that more than 80% of small cell lung cancer patients with LEMS are undiagnosed, representing a significant opportunity. Currently, we estimate small cell lung cancer LEMS patients account for almost 30% of new enrollment each month. In 2023, we will increase our share of voice to thoracic oncologists through the addition of oncology thought leader liaisons. along with greater lung cancer conference participation. In addition, we continue to strengthen our relationships with lung cancer advocacy to both educate clinicians and patients about LEMS. And we are looking to partner with institutions to help more small cell lung cancer patients get screened and diagnosed. Recently, Catalyst was nominated for a PM360 PharmaChoice Award for patient engagement. This award nomination recognizes the great educational resources and programs that Catalyst offers LEMS patients, from one-on-one support of the patient access liaisons, virtual and live patient programs, to the patient forum held earlier this year that was believed to be the largest gathering of LEMS patients in the U.S. We are pleased to have been recognized for this industry nomination, which underscores our continued efforts to providing patients with valuable resources to help assist them in their LEMS treatment journey. In closing, we are pleased with our performance in Q3 and remain very optimistic about the organic growth potential for Ferdaps moving forward. I want to thank the entire team at Catalyst for their unwavering commitment to the LEMS community. I'll now turn the call over to Dr. Stephen Miller, our Chief Operating Officer and Chief Scientific Officer for an update on R&D activities.
Jeff Del Carmen
Thanks, Jeff. Our clinical and regulatory strategy for Ferdaps continues to focus on expanding access to all patients for the treatment of LEMS and enhancing the Ferdaps patented state to maximize its commercial life. I will begin by discussing the recent approval of our supplemental new drug application for Ferdaps seeking to treat pediatric LEMS patients. During the first quarter of 2022, we filed this supplemental NDA, and I am pleased to report that it was approved by the FDA on September 29th of this year. With the approval of this supplemental NDA, all pediatric patients age six and above and all adults will now have access to Ferdaps as an FDA-approved product to treat their LEMS in the U.S. However, as Pat mentioned, the pediatric LEMS patient population is a very small patient group with a total U.S. population estimated to be less than 30 in the United States. Next, in July of this year, we acquired two new patents from Jacobus Pharmaceutical that further bolster our intellectual property portfolio for Furneps, potentially extending our IP out to 2037. One of those patents has been listed in the FDA's Orange Book with an expiration date of February 25th, 2037, which brings the total number of Orange Book listed patents to six. The other patent is enforceable, but not eligible for listing. As part of our acquisition of assets from Jacobus, we settled our patent litigation against Jacobus. In our review, the settlement demonstrates the robustness of our Ferdapps intellectual property estate, reinforces its exclusivity, and gives us further confidence in the commercial durability of Ferdapps. Additionally, as part of our ongoing IP portfolio management initiatives, we worked with the U.S. Patent and Trademark Office to amend the expiration date of one of Catalyst's orange booklisted patents from April 7th, 2034 to May 26th, 2034 for an additional six weeks of exclusivity. As part of our acquisition of assets from Jacobus, we acquired a license for Resurgi in the United States and Mexico. This acquisition aligns with our strategic goal to serve all LEMS patients. We are continuing to supply amifabridine tablets to existing IND holders that had access to amfampradine tablets at the time of the settlement. These IND holders are treating about 100 patients with neuromuscular conditions other than limbs, predominantly congenital myasthenic syndromes, or CMS, for which FERDEPs is not currently approved. At this time, we intend to continue to supply amfampradine tablets to those patients that were receiving treatment under these INDs at the time of settlement. We have verified that these IND applications are current, and patient engagement with these physicians is ongoing. We are also working on manufacturing initiatives in order to service these investigational new drug application amifabridine tablet requests for the longer term. Finally, we are planning to seek, through a supplementary NDA, to increase the indicated maximum dose of Ferdaps from 80 milligrams per day to 100 milligrams per day. A number of Ferdaps patients are already being treated at this dose after their physician worked with the pharmacy and insurance providers to justify the higher dose. Other patients on the current indicated maximum dose of 80 milligrams per day and their physicians have expressed a need to increase the indicated daily dosage to 100 milligrams, and this planned supplement, if approved, will help to optimize the treatment of those patients. The previously described acquisition of the Resurgi rights gives us access to safety and efficacy data that we believe may bolster any future filing seeking to increase the indicated Ferdep's maximum dosage to 100 milligrams per day. As a reminder, Resurgi was previously approved at a maximum dosage of 100 milligrams per day for children. Our sub-licency partner, Dido Pharma in Japan, has just completed an enrollment in their Ferdap Phase 3 clinical trial, which is required to seek approval for the Japanese market. Collection of the follow-up safety data is ongoing, and translation of Catalyst US NDA documents to Japanese is underway in order to assemble and file an NDA for Japan in early 2024. Finally, on the long-term strategy front, we have been accelerating our efforts with our business development initiatives, And we are in advanced stages of due diligence, and we are making substantial progress in evaluating strategic opportunities. A key element in the evaluation of these opportunities is that candidate opportunities should provide a significant therapeutic benefit to patients. While we haven't yet reached agreement on any of these opportunities, we remain confident in identifying the right opportunities to maximize our capabilities and resources. We have uniquely strong teams that are highly aligned as we continue to execute on initiatives across our business, development, and operations enterprises to achieve our goals. Our recent achievements demonstrate that our ongoing ability to manage our initiatives successfully and achieve important milestones that have us in an excellent position to further advance our long-term growth strategies. At this time, I would like to turn the call over to Ali Grandi, our CFO.
Ali Grande
Thanks, Steve. We are very pleased with our financial results for the third quarter of 2022. Total revenue for the third quarter of 2022, principally preferred up to product revenue net, was $57.2 million, a 59.2% increase when compared to total revenue of $36 million for the third quarter of 2021. Net income before income taxes for the third quarter of 2022 was $26 million, an $84.8 8% increase year over year compared to net income before income taxes for the third quarter of 2021 of 14.1 million. We reported GAAP third quarter 2022 net income of 22.7 million or 22 cents per basic and 20 cents for diluted shares. A 120.2% increase year over year compared to the third quarter 2021 GAAP net income of $10.3 million or $0.10 per basic and diluted share. Our effective tax rate for the third quarter of 2022 on an annualized basis was 19.7% compared to 24.3% for the third quarter of 2021. The decrease in effective tax rate for the third quarter of 2022 is due to an increase in stock option exercises in the third quarter of 2022 due to a sharp increase in our stock price. We anticipate variability in our tax rate on a quarterly basis. However, we expect a more normalized effective tax rate for the year in the range of 22 to 23%. Non-GAAP net income for the third quarter of 2022 was $28.6 million for $0.28 per basic and $0.26 per diluted share, which excludes from GAAP net income of $22.7 million stock-based compensation expense of $2.1 million, depreciation of $35,000, amortization of $518,000 related to our Q322 license and asset acquisition from Jack Lewis Pharmaceuticals, and an income tax provision of $3.3 million. This compares to non-GAAP net income for the third quarter of 2021 of $15.6 million, or $0.15 per basic and $0.14 per diluted share. which excludes from GAAP net income of $10.3 million, stock-based compensation expense of $1.5 million, depreciation of $31,000, and an income tax provision of $3.7 million. The above represents an approximately 83.3% year-over-year increase of non-GAAP net income. Cost of sales of $9.7 million for the third quarter of 2022 increased when compared to $5.3 million for the third quarter of 2021. This represents 30.1% of total operating costs for Q3 2022, up from 24.2% of total operating costs for Q3 2021. For the third quarters of 2022 and 2021, cost of sales was approximately 17% and 15% of product revenue net, respectively, and consisted principally of royalties due to our furred-ups licensors. As we mentioned last quarter, royalties to our furred-ups licensors increased by 3% when net product sales exceeds $100 million in any calendar year. Since we exceeded $100 million in net product sales early in the third quarter of 2022, we expect that cost of sales will trend higher for the last two quarters of 2022. Research and development expenses were $8.3 million in the third quarter of 2022, compared to $4.5 million in the third quarter of 2021. R&D expenses increased the percentage of total operating expenses to 25.9%, from for Q3 22 from 20.4% for Q3 21. This was principally due to our recording in the third quarter of 2022, but 4.1 million inventory write-off to R&D for inventory acquire in connection with the research acquisition. SG&A expenses for the third quarter of 2022 total $14.2 million compared to $12.2 million for the third quarter of 2021. SG&A expenses decreased as a percentage of total operating expenses to 44.1% for Q3-22 compared to 55.4% for Q3-21. As a reminder, in early July 2022, we entered into a license and purchase agreement with Jacos Pharmaceuticals for the rights to develop and commercialize resurging in the U.S. and Mexico. In connection with this license, we acquired $4.1 million in inventory manufactured by Jacobus and licensed and acquired intangibles with a value totaling $33.6 million. This agreement was accounted for as an asset acquisition. As previously noted, the acquired inventory was expensed to R&D during the third quarter of 2022. The related license and acquired intangibles Assets will be amortized on a straight and light basis over the next 14.5 years, resulting in amortization going forward of approximately $580,000 per quarter. During July 2022, we paid Jaglis $10 million at closing in connection with the license and asset acquisition, and we'll pay $10 million on the second and third anniversary of the closing. In addition, we will pay a small single-digit royalty on a misappropriating product sales in the U.S. as defining the agreement with certain annual minimums until the related patents expire, which may be reduced or eliminated under certain circumstances. More detailed information and analysis of our Q322 financial performance may be found in our quarterly report on Form 10Q, which was filed with the Securities and Exchange Commission yesterday, November 9th, and can be found on the investor relations page of our website at www.catalystpharma.com. As reported, we ended the quarter with cash and investments of $256.1 million, which we believe will enable us to advance our R&D programs and support our strategic growth initiative to diversify our product portfolio. And with that, I will turn the call over to Pat.
Patrick McEnany
Thanks, Sally. in closing our prepared remarks i'd like to say that the catalyst team delivered a tremendous third quarter performance once again attaining many operational and financial milestones reflecting our businesses strength in the successful execution of our strategy i'm proud of how catalyst teams are performing and the positive impact that we're having on patients lives which is fueled by our dedicated employees who have a shared commitment to the patient community that we serve. With our strong year-to-date performance and our positive outlook for the fourth quarter, we are well positioned to achieve our near and long-term goals and deliver value to our stakeholders. Operator, we'd now like to open the call for questions.
Operator
Thank you. The floor is now open for questions. If you do have a question, please press star 1 on your telephone keypad at this time. If your question has been answered, you can remove yourself in the queue by pressing 1. Again, ladies and gentlemen, it's star 1. And our first question comes from June Lee from Truist. Go ahead, June.
June Lee
Yes, good morning. This is Leson for June. Thank you for taking my questions and congrats on the progress. I have just a few questions for me here. So first, can you comment on how many patients are currently on furloughs to date and how many of those are small cell lung cancer patients?
Patrick McEnany
Good morning, Melissa. Thanks for the question. I'll turn that over to Jeff.
Allie
Jeff, thanks for the question. We haven't provided patient numbers historically. What I can tell you is that recent month, like I mentioned, about 30% of our new enrollments are small cell lung cancer LEMS patients. And that number will continue to grow as we implement some of the small cell lung cancer LEMS strategies that I mentioned.
June Lee
Okay, got it. Well, to build up on that, can you kind of, I guess, expand on how you are targeting this population? And I appreciate the comments you made earlier, but Starting next year and throughout as we progress throughout the year, how many of these 1,500 small cell lung cancer patients could you potentially target and get on drug over the course of the year?
Allie
You know, it's hard to say as far as, you know, what we expect, but we expect to, you know, move up that number from 30% that we're seeing currently to about 35 to 40% in 2023. So that's the type of growth that we're expecting next year. As far as the programs that we're putting in place, the thought leader liaisons that we are budgeting for, think of those individuals as working with some of the high volume cancer institutions around the country. And the key with those, that partnership will be to create programs that allow for small cell lung cancer patients to be tested through a BGCC test and really to be identified and diagnosed sooner, hopefully to help these patients out. So that's our approach there. And once these patients are diagnosed, then they typically will be referred either to a neuromuscular specialist or a neurologist, or we also, there are some oncologists, thoracic oncologists, that will diagnose and treat on their own. So that's the whole strategy with the thought leader liaisons. And that's to supplement our efforts that we already have out there, that we're educating these physicians through multiple channels, about LEMS, the disease state, as well as the available treatment, which is Ferdaps.
June Lee
Great. That is helpful. And on looking at your midpoint of your guidance, I guess would imply 4Q would be flat or a little bit down versus 3Q. Is it to do with seasonality or something else that drives this?
Patrick McEnany
No, Les, this is Pat. We just, you know, we've always been conservative. We're going to remain conservative. We, you know, we, for the first time, as you know, this year we gave guidance. So we're working our way through this and we're comfortable with providing that range. I, sitting here today, Based on the start for this quarter, I would not say to you that we're going to have a down quarter.
June Lee
Got it. That is helpful. I'll jump back into queue. Thank you.
Operator
Thank you. Thank you. Our next question comes from Charles Duncan from Cantor Fitzgerald. Go ahead, Charles.
Charles Duncan
Hi. Good morning. It's on the line for Charles. Thank you for taking our questions, and congratulations on the quarter. So I have a couple on the commercial end and then I have a follow-up. So I guess I was wondering if you could start by characterizing whether the patient growth was from breath or death in the prescriber base. And then I was also hoping you could discuss user reviews as well as if you've seen a distinction between treatment IE patients versus the switchers from Resurgy and if there's been a difference in persistence between those two groups. Thanks.
Patrick McEnany
Good. Thanks for the question, Jeff.
Allie
Sure. So as far as the breadth or the depth, you know, a significant part of our prescriber base are one-time writers. About 75% of our writers are, again, only have one patient. And that's truly indicative of a therapeutic area that there's not a center of excellence that treats lens. You know, in other therapeutic areas or orphan diseases, there may be a handful of these centers throughout the country, but that's not the case for LEMS. So we're seeing a broader and wider base of prescribers, and that is a potential in the future is that, you know, when we look at it, about 40% of our enrollments in Q3 were from neuromuscular specialists. Neuromuscular specialists will see, you know, a volume, a higher volume of potential LEMS patients. So we think in the future there's opportunity as physicians gain experience with prescribing Ferdaps and seeing LEMS patients and know what to look for, that hopefully they will, you know, look within their practice to identify additional LEMS patients that are appropriate for Ferdaps too. As far as the difference between the Resurgy patients that transitioned over to Ferdaps, we're not seeing any difference in persistence. These patients, the product works, the transition, these patients did not lapse in therapy when they were transitioned over, and we're not seeing any higher discontinuation rate for that subset of patients versus the patients that were always just on Ferdaps. Does that answer your questions? Yeah, absolutely.
Charles Duncan
Thank you. And I have a quick follow-up. So I think I caught during the comments that there are non-LIMS patients with neuromuscular disorders who are still on Resurgy. So I was wondering if you could characterize, you know, the disease states of those patients if that may be a pool from which you would choose to pursue, of indications from which you would choose to pursue clinical development, and if you would, would you choose to go that route with Resurgy or Firdevs?
Patrick McEnany
Thanks. Yeah, great question. I'll ask Dr. Miller to answer that.
Jeff Del Carmen
Thank you, Paul. That's actually a compound question, so remind me if I don't hit all the questions. The disease that I mentioned in the earlier part of our discussion that most of these patients have is congenital myosinic syndrome. And it's about 100 patients that are currently being treated with Resurgi under investigator IMDs. The disease is actually not a single monolithic disease, but consists of a collection of over 50 different genetic disorders. We have studied it in the past. We have had discussions with the FDA previously. about clinical trial design for this disease. And the reality is that the agency wants to see clinical trials that are stratified by genetic subtypes. And so that makes clinical trial design quite difficult. And we are currently evaluating if we have enough patients to pursue an indication for congenital myosinic syndromes at this time. But right now, we don't have any specific plans to pursue the indication for congenital myosinic syndromes. And we will continue to provide the patients with Resurgi because that's what they're used to. And we have manufacturing initiatives underway in order to try to provide those patients with the drug for a longer term.
Charles Duncan
Wonderful. That's very helpful. Thank you very much. And yeah, I think that's all for me. Congratulations on the quarter.
Jeff Del Carmen
Thank you. Thank you.
Operator
Thank you. And our next question comes from Scott Henry from Roth Capital. Go ahead, Scott.
Scott
Thank you, and congratulations, Pat, and to the whole team on such tremendous success you've had with FirdApps. I did have a couple questions, I guess for Allie. First, did you pull out the $4 million for that Resurgy payment? I don't think you did. It looked a little bit like a one-time expense in the quarter.
Ali Grande
Yes, it will be a one-time expense in this quarter. It's related to the inventory that we expense related to our acquisition from Jacobus.
Patrick McEnany
And Scott, that was included in our GAAP net income.
Ali Grande
Yes, in our R&D caption.
Scott
Yep. And I believe it was included in the non-GAAP too, correct?
Ali Grande
Correct. We did not exclude it from non-GAAP.
Scott
Perfect. Thank you. And, Ali, since I've got you there, interest income is starting to become a meaningful number. You know, approximately what rate do you get on that cash balance?
Patrick McEnany
Scott, we, yeah, the rates have moved up nicely. And, of course, our investments are all very conservative, buying 90 days, for the most part, 90-day T-bills. And those rates earlier this year were seven basis points. Today we're getting right around three and a half to four, you know, depending on, you know, when you buy them. So significant increase in potential for larger investment income.
Scott
Yeah, it's a good time to have a lot of cash. And then I guess just in a bigger picture question, I ask this question a lot on the calls, but how do you view the organic growth currently, particularly with the non-small cell lung cancer boost you're getting? Where would you kind of categorize that?
Patrick McEnany
Scott, I'll turn that over to Jeff again.
Allie
Yeah, hi, Scott. Our organic growth, and we've demonstrated this over the last several years, is about 15% to 20% annually. And we are very confident that we will continue to sustain that organic growth. Okay.
Scott
And then a final question. You've got a strong patent position in place, multiple orange book listed patents. Just with regards to expectations, would you expect someone to challenge these? Should we be surprised if someone challenges? I mean, I typically think of that as just part of the business cycle. Any thoughts on that?
Patrick McEnany
Yeah, Scott, you're exactly right. With a drug that's doing in excess of $200 million, again, we would be remiss if we didn't expect at some point to be challenged It's just, it's part of the business. So I can tell you that, you know, it's anticipated and we will be prepared.
Scott
Okay, great. Thank you for taking the questions.
Patrick McEnany
Yep.
Operator
And our next question comes from Joe Catanzaro from Piper Sandler. Go ahead.
Joe Catanzaro
Hi, everyone. This is Albert on for Joe. And first off, congratulations on a really nice quarter. I was interested in your comments on there was a 50% increase in the calcium channel antibody test. I was just wondering if you could maybe provide a little more insight and maybe quantify how many of these tests were done.
Allie
What I can tell you is just national laboratories that we partnered with and that data is available. What we can say is when we looked at the raw number, and I don't have that raw number on me, but when we looked at it, the number was at least 50% greater in 2022 versus 2021. That data has been very hard to obtain just because of the pandemic, and it's six months delayed in getting that information. So what it signifies is that our efforts to get patients tested, understand what symptoms and how to test for LEMS, it's working. And that patients are now that were unable to get into these hospitals for diagnostic tests are now able to get in there. So that should also get more positive BGCC tests and those patients will now be addressable and we can now help these patients get on Ferdap sooner. So that's what that number was really meant to signify.
Joe Catanzaro
Okay, great. Thanks. Maybe one more quick one. I was just wondering, is it a significant portion of patients that are kind of already pushing this maximum daily dosage of 80 milligrams a day?
Allie
When we look at our patients, about 40% of our patients are at 80 milligrams or higher. So, yeah, that's what we look at in our current patient base.
Joe Catanzaro
Okay, great. That's very helpful. All right, thank you.
Patrick McEnany
Thank you.
Operator
And that appears to be the last question at this time. I would now like to turn it back to Pat McEnany for any closing remarks.
Patrick McEnany
Thanks, everyone, for joining our call. We look forward to our next corporate update And have a great day. Thank you.
Operator
Thank you. This does conclude today's conference. We thank you for your participation. You may disconnect your lines at this time and have a wonderful day.
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