ImmuCell Corporation

Good morning, everyone, and welcome to the EmuCell Corporation conference call to discuss strategic change in focus and unaudited 2025 sales results. All participants will be in a listen-only mode. After today's presentation, there will be an opportunity to ask questions. Please also note today's event is being recorded. At this time, I'd like to turn the floor over to Joe Diaz with Lithium Partners. Please go ahead.

Thank you, Jamie. Good morning and welcome. As our operator indicated, my name is Joe Diaz with Lithum Partners. We're the investor relations consulting firm for Emucel. I thank all of you for joining us today to discuss a change in Emucel strategic focus and the unaudited sales results for the fourth quarter and full year, December 31, 2025. Listeners are reminded and cautioned that statements made by management during the course of this call include forward-looking statements. which include any statement that refers to future events or expected future results or predictions about steps the company plans to take in the future. These statements are not guarantees of performance and are subject to risks and uncertainties that could cause actual results, outcomes, or events to differ materially from those discussed today. Additional information regarding forward-looking statements and the risks and uncertainties that could impact future results outcomes, or events is available under the cautionary note regarding forward-looking statements or the safe harbor statement provided with the press release that the company filed last night, along with the company's other periodic files with the SEC. Information discussed on today's call speaks only as of today, Friday, January 9, 2026. The company undertakes no obligation to update any information discussed on today's call. Please note that certain non-GAAP financial measures will be made during today's call. With that said, let me turn the call over to Oliver Tabucor, President and CEO of Emicell Corporation for opening remarks. We will then have further remarks from Tim Fiore, pardon me, the CFO of Emicell, and then we will open the call for your remarks and questions. Oliver?

Thank you, Joe, and good morning, everyone. This continues to be an exciting time at Emusel. We shared in late December that we are shifting our strategy as a company to focus on first defense, and consistent with prior practice, we have an earnings call to discuss our full-year financial results, which will take place in late February, and we will not be commenting on earnings estimates to date. However, the strategic shift is significant for our company, and we decided it would be helpful to review the implications of that decision and our fourth quarter and full year on audited sales results in today's call. So we're happy to report that we had a near record sales quarter, and this one was without tailwinds from catching up on back orders in the fourth quarter of 2025. Our Chief Financial Officer, Tim Fiore, will walk us through the numbers in more detail, but 8.7% growth in the U.S., And 41.3% growth of TriShield in the fourth quarter of 2025 compared to the fourth quarter of 2024 are exciting achievements for the company. We're also seeing substantial improvements to our manufacturing output with more to come. And as recently announced, we are now in a position to repurpose manufacturing assets from Retain to support our long-term growth at Burst Defense after we decided to suspend investment in manufacturing Retain. Our decision to redouble our focus on first defense and pause investment and retain is based on two factors. The first is that we have very high confidence in future sales and profit growth potential in our first defense business that we feel justifies investment and focused execution. The second reason is the unfortunate stumbling block post when the United States Food and Drug Administration, the FDA, issued an incomplete letter for our retain new animal drug applications. The practical implication of the FDA's decision is that we are still years away, rather than just months away, from achieving an FDA-compliant manufacturing solution needed to launch this product. Continuing to invest and retain would have required an increased commitment to fund expenses and capital investments to bring this new product to market, diverting resources that could instead be devoted to expanding an existing successful product franchise, namely First Defense. Let's talk about First Defense. Our First Defense products address a critical industry need for protecting calves. The newborn calf market has evolved rapidly over the past five years as calf values have increased significantly, driven in part by widespread adoption of beef on dairy crossbreeding and the shortage of beef calves related to drought and the closing of the Mexican border, amongst other things. As a result, newborn calves can be worth approximately $1,300 on day one of life, compared to roughly $200 in 2003. Historically, dairies would derive 2-3% of their yearly income from selling the calves they don't need, and now it's up to 20-25%. And this macro trend has raised the economic stakes of early life calf health and survival. Immucel's first defense provides proven protection against neonatal scours, helping to safeguard these high-value cats. So we believe we have great runway in the market for scour protection, which we have estimated is approximately $900 million in total addressable market worldwide. So our strategy is to get out and meet more customers with strong medical, scientific, and outcomes-based arguments for trying and using our products. We also have opportunities for increasing our first defense manufacturing output through operational improvements. In 2025, we increased output of our key bottleneck process, lyophilization, by more than 15%, and we believe we can achieve a similar rate of increase in 2026, and to do so without using significant incremental capital. So more on that later. All these opportunities in our first defense business require, and in our judgment deserve, increased focus and execution. Now, a second reason for our shift is the FDA's incomplete letter for retain. We have been developing this innovative treatment of subclinical mastitis in dairy cows for some time, and thought we were close to obtaining final approval. Immucel passed FDA requirements for safety, efficacy, and four of the five technical sections of our application, and we had expected that our contract manufacturer's completion of the fifth technical section would soon follow. You will recall that we decided to employ this contract manufacturer for filling the active ingredient into syringes in order to limit our capital expenditure and to reduce our risk. And unfortunately, that is not how things worked out. We are not in a position to comment on details, but we understand that the reason the FDA declined to approve Our application was because our contract manufacturer had still not satisfactorily addressed previously cited inspectional deficiencies. So we received the incomplete letter on December 23rd and shared this news with you the next business day. The incomplete letter from the FDA, combined with our contract manufacturer's refusal to extend their contract beyond March 2026, meant that we would have had to restart our manufacturing section and spend an unknown period of time, years, to obtain approval, incurring significant expenses along the way. We decided this is not the highest value use of our company's resources. Instead, we will complete the investigational studies that are underway to document efficacy in the field and then prepare the best case we can for a potential future partner for a retain. In the meantime, we will redeploy most of the manufacturing assets that were built for retained toward expansion of FIRST Defense capacity. FIRST Defense also uses liquid processing equipment, for example, and we have determined that most of the retained equipment can be repurposed. At this point, I'm going to turn the call over to Tim Fiore, our Chief Financial Officer, for a deeper review of the financial implications of this decision and the quarter and full year sales highlights. Tim?