Puma Biotechnology Inc

Good afternoon. My name is LaTonya, and I will be your conference call operator today. At this time, all participants are in a listen-only mode. After the speaker's foremost remarks, there will be a question and answer session. If you would like to ask a question during that time, simply press the star key, then the number one on your telephone keypad. If you would like to withdraw your questions, please press star 2. If you should require operator assistance during the conference, please press star 0. As a reminder, this call is being recorded. I would now like to turn the conference over to your host today, Marianne Ohanison, senior director of IR for Puma Biotechnology. You may begin your conference.

Thank you, LaTonya. Good afternoon, and welcome to Puma's conference call to discuss our earnings results for the second quarter of 2025. Joining me on the call today are Ellen Arbach, chief executive officer, president, and chairman of the board of Puma Biotechnology, Maximo Noguez, chief financial officer, Heather Blaber, senior vice president of marketing, and Roger Storms, senior vice president of sales. After the close today, Puma issued a news release detailing earnings results for second quarter 2025. That news release, the slides that Roger will refer to, and a webcast of this call are accessible via the home page and investor sections of our website at pumabiotechnology.com. The webcast and presentation slides will be archived on our website and available for replay for the next 90 days. Today's conference call will include statements about Puma's future expectations, plans, and prospects that constitute forward-looking statements for purposes of federal securities laws. Such statements are subject to risks and uncertainties, and actual events and results may differ from those expressed in these forward-looking statements. For a full discussion of these risks and uncertainties, please review our periodic and current reports filed with the SEC from time to time, including our annual report on Form 10K for the year ended December 31, 2024. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this live conference call, August 7, 2025. Puma undertakes no obligation to revise or update any forward-looking statements to reflect events or circumstances after the date of this conference call, except as required by law. During today's call, we may refer to certain non-GAAP financial measures that involve adjustments to our GAAP figures. We believe these GAAP metrics may be useful to investors as a supplement to, but not a substitute for our GAAP financial measures. Please refer to our second quarter 2025 earnings release for reconciliation of our GAAP to non-GAAP results. I will now turn the call over to Alan.

Thank you, Mary Ann, and thank you all for joining our call today. Today, Puma reported total revenue for the second quarter of 2025 of 52.3 million. Total revenue includes product revenue net, which consists entirely of Neuralink sales, as well as royalties from our sub-licensees. Product revenue net was 49.2 million in the second quarter of 2025, an increase from 43.1 million reported in Q1 2025, and an increase from 44.4 million reported in Q2 2024. Product revenue for the second quarter of 2025 was impacted by approximately 1.3 million of inventory decrease at our specialty pharmacies and specialty distributors. Royalty revenue was 3.2 million in the second quarter of 2025, compared to 2.9 million in Q1 2025, and 2.7 million in Q2 2024. We reported 2,608 bottles of Neuralink sold in the second quarter of 2025, an increase of 270 from the 2,338 bottles sold in Q1 2025. In Q2 2025, we estimate that inventory decreased by 72 bottles. In Q2 2025, new prescriptions were down approximately 3% compared to Q1 2025, and total prescriptions were up approximately 3% compared to Q1 2025. Roger will provide further details in his comments and slides. I will now provide a clinical review of the quarter. Then Heather Blaber and Roger Storms will add additional color on Neuralink's commercial activities. Maximo Noguez will follow with highlights of the key components of our financial statements for the second quarter of 2025. As investors are aware, Puma currently has two ongoing phase two trials of our investigational drug Allocertib. One is the Allisca breast trial, which is a phase two trial of Allocertib, in combination with endocrine treatment in patients with HER2 negative, hormone receptor positive metastatic breast cancer. The second is the Allisca Lung One trial, which is a phase two study looking at the efficacy of Allocertib monotherapy in patients with small cell lung cancer. As a reminder, the Allisca breast one investigates Allocertib in combination with endocrine treatment, which consists of either anastrozole, exomestane, letrozole, flouvestrin, or tamoxifen in patients with HER2 negative, hormone receptor positive metastatic breast cancer. Patients must be chemotherapy naive, must have previously received treatment with a CDK46 inhibitor, and received at least two prior lines of endocrine therapy in the recurrent or metastatic setting to be eligible for the trial. Patients are being dosed with Allocertib either at 30 milligrams, 40 milligrams, or 50 milligrams twice daily, BID, on days one to three, eight to 10, and 15 to 17 on a 28-day cycle, in combination with endocrine therapy of the investigator's choice. Patients must have not been previously treated with the endocrine therapy in the metastatic setting that is being given in combination with Allocertib in the trial. Primary efficacy endpoints include objective response rate, duration of response, disease control rate, and progressions for e-survival. As a secondary objective, the company will be evaluating each of these efficacy biomarkers within biomarker subgroups in order to determine whether any biomarker subgroup correlates with better efficacy, as has been seen in preclinical and clinical studies in other cancers, including breast and small cell lung cancer. The company will then look to focus the future clinical development of Allocertib in combination with endocrine therapy for patients with HER2-negative hormone receptor-positive breast cancer within these biomarkers. The trial was initiated in late November 2024. There are currently 33 sites in the US and 18 sites in Europe that have been activated. For the trial, and the trial is enrolling ahead of expectations. There are currently 62 patients enrolled in the trial and 10 additional patients in screening. We are looking to have interim data from this trial later in 2025. With respect to the ALISCA Lung 1 study, as investors are aware, Puma has an ongoing phase two trial of our investigational drug Allocertib to investigate the efficacy of Allocertib monotherapy in patients with small cell lung cancer and specifically look at the efficacy of the drug in patients with biomarkers where the aurora kinase pathway plays a role. The goal is to correlate the efficacy in these biomarker subgroups in the ALISCA 1 study to the efficacy that was previously seen in the biomarker subgroups from the randomized trial of Paclitaxel plus Allocertib versus Paclitaxel plus placebo that was published in the Journal of Thoracic Oncology in 2020. In that randomized trial, a progression free survival and overall survival benefit were seen in patients with biomarkers that correlate with the aurora kinase pathway. If the efficacy and biomarker data are comparable from the two studies, the company would look to engage with the FDA to discuss the regulatory path further. As discussed on the recent earnings call, the company believes that the data obtained to date from the ALISCA Lung 1 study is providing a preliminary indication of potentially better activity in patients with biomarkers where the aurora kinase pathway plays a role. The most recent analysis of the pharmacokinetic data from the ALISCA Lung 1 study suggests that we are seeing a lower PK of Allocertib in the ALISCA 1 trial compared with the previous phase two study of Allocertib monotherapy in small cell lung cancer patients that was published in Lancet Oncology. The company has amended the protocol for the trial to increase the dose of Allocertib from 50 milligram BID to 60 milligram BID, which the company believes will increase the PK of the drug to levels closer to that what was seen in the prior phase two trial. The company is currently enrolling patients at the 60 milligram BID dose. There are currently 52 patients enrolled in the trial with an additional three patients in screening. The company looks to have additional interim data from the trial later in 2025. As mentioned on prior earnings calls and in response to investor questions, PUMBA continues to evaluate several drugs potentially in license or acquire that allow the company to diversify itself and leverage PUMBA's existing R&D regulatory and commercial infrastructure. The company will keep investors updated on this as it progresses. I will now turn the call over to Heather Blaber for an update on our marketing initiatives and Roger Storms will follow with a review of our commercial performance during the quarter.

Thank you, Alan. I appreciate the opportunity to share some additional insights into our marketing strategy. The marketing team is focused on creating awareness of both clinical messaging for Neuralynx as well as recently published data that demonstrate the continued need to reduce the risk of recurrence and HER2 positive early breast cancer after completion of adjuvant therapy. We continue to invest in market research to help us better understand risk factors that put a patient at high risk of recurrence and HER2 positive early stage breast cancer as well as garner insights on the clinical data in this patient population. Together with our marketing initiatives, our strategy is focused on increasing awareness of our broad indication of patients that are appropriate for treatment with Neuralynx. Based on our insights, we have adjusted our strategy on key learnings and revised both personal and non-personal messaging with the goal of engaging physicians on a broader set of patients where the risk of recurrence remains high and where we believe Neuralynx can play an important role in helping to reduce the risk of recurrence in patients with early stage HER2 positive breast cancer. In addition to revising our messaging, we recently rolled out a new resource to support patients throughout their recommended course of Neuralynx therapy. This educational resource will be provided to patients on a monthly basis as they receive their refills. Lastly, year to date, we have reached .7% of oncologists through non-personal promotion and continue to expand our share of voice, working closely with the sales team to increase engagement with healthcare providers. In summary, we are excited about our new marketing strategy and messaging, which we believe will continue to help educate and engage oncologists on the unmet need for those diagnosed with HER2 positive early stage breast cancer. I will now turn the call over to Roger Storms to provide an overview on the commercial performance for the second quarter.

Thank you, Heather, and thanks to everyone for joining our second quarter earnings call. But before I move into the commercial review, just a reminder that I'll be making forward-looking statements. The sales team continues to work hard on expanding overall HCP reach and frequency with an emphasis on increasing engagement when treatment decisions are being made. Q2 2025 call activity was up 16% year over year and up 24% quarter over quarter. This is a direct result of being able to fill key vacancies that existed in Q1, as well as continued emphasis put on executional excellence and increased accountability in Q2 with the existing sales team. The commercial team remains focused on expanding the utilization of narrow links with a primary emphasis on patients who are at increased risk of recurrence. The team has continued their emphasis on improving clinical education and engagement through non-personal promotion, as well as using the patient resource brochure designed to improve persistence and compliance throughout their narrow links therapy. Let me now transition to some of the commercial slides where I'll provide some additional specifics around performance. Slide three is an illustration of our distribution model, which is broken out into the specialty pharmacy channel and the specialty distributor or in-office dispensing channel. In regards to the overall distribution of our business, in Q2 2025, about 63% of our business was purchased through the SP channel and the remaining 37% was purchased through the SD channel. We are seeing some stronger growth in the SD channel driven by two main factors. One increased 340B purchasing and two increased sales in the group purchasing organization or GPO segment. Turning to slide four, narrow links net product revenue in Q2 2025 was 49.2 million, which represents an increase of 6.1 million from the 43.1 million we reported in Q1 of 25 and an increase of 4.8 million from the 44.4 million we reported in Q2 of 24. I will provide some more details around inventory changes and Maximo will provide some additional specifics around gross to net expenses during his update. In Q2 2025, we estimate that inventory decreased by about 1.3 million. As a comparator, we estimate that inventory increased by about 4.7 million in Q1 of 2025 and decreased by about 2.3 million in Q2 of 2024. Slide five shows Q2 2025 X factory bottle sales and also provides both a year over year and a quarter over quarter comparison. In Q2 2025, narrow links X factory bottle sales were 2,608, which represents an approximate 12% increase quarter over quarter and a 4% increase year over year.

Similar

to the prior slide, let me specifically call out the inventory changes from a bottle perspective. In Q2 2025, we estimate that inventory decreased by 72 bottles. As a comparator, we estimate that inventory decreased by 250 bottles in Q1 of 2025 and decreased by 132 bottles in Q2 of 2024. Let me take a moment to provide some additional metrics regarding our second quarter performance. In Q2, we saw enrollments decrease about 9% quarter over quarter and decline about 11% year over year. New patient starts or NRX follow a similar pattern, declining approximately 3% quarter over quarter and also declining 1% year over year. Turning to total prescriptions or TRX, we saw TRX increase 3% quarter over quarter and decline about 2% year over year. Finally, let me share some specifics around demand. In Q2, we saw a demand increase about 4% quarter over quarter and increase about 2% year over year. As mentioned earlier, we've seen a stronger demand growth in the SD channel where we saw demand grow about 8% quarter over quarter and about 17% year over year. Slide six highlights the quarterly adoption of dose escalation since narrow links launch. In Q2, approximately 71% of patients started narrow links at a reduced dose. This is similar to the 72% we reported in Q1 of 2025. Continued messaging and adoption of dose escalation remains an important commercial priority. Patients who are started on narrow links utilizing dose escalation have better persistence and compliance. We believe dose escalation coupled with the new patient education resources will give patients better support throughout their narrow links therapy and ultimately help them reduce the risk of recurrence. Slide seven highlights the strategic collaborations we have formed across the globe. We really appreciate the excellent work being done by our partners around the globe and look forward to supporting their continued success moving forward. Let me wrap up by thanking the entire Puma team for their continued passion and commitment for helping patients and their families battling breast cancer. This disease can have devastating effects and we know more can be done and more needs to be done. I will now turn the call over to Maximo for review of our financial results.

Thanks, Roger. I will begin with a brief summary of our financial results for the second quarter of 2025. Please note that I will make comparisons to Q1 2025, which we believe is a better indication of our progress as a commercial company and year over year comparisons. For more information, I recommend that you refer to our second quarter 2025, thank you, which will be filed today and includes our consolidated financial statements. For the second quarter of 2025, we reported net income based on gap of 5.9 million or 12 cents per share. This compares to net income in Q1 2025 of 3 million or six cents per share. On a non-GAP basis, which is adjusted to remove the impact of stock-based compensation expense, we reported net income of 7.5 million or 15 cents per basic and diluted share for the second quarter of 2025. Gross revenue from Nalink sales was 62.1 million in Q2 2025 and 54.4 million in Q1 2025. Alan mentioned it, net product revenue from Nalink sales was 49.2 million, an increase from the 43.1 million reported in Q1 2025. The increase in net revenue was driven primarily by an increase in Nalink's total sold in the US and an increase in net selling price. Inventory drawdown by our distributors was approximately 1.3 million in Q2 versus drawdown of approximately 4.7 million in Q1 2025. Royalty revenue totaled 3.2 million in the second quarter of 2025 compared to 2.9 million in Q1 2025. Our gross net adjustment in Q2 2025 was .8% unchanged from Q1 2025. Cost of sales for Q2 2025 increased to 12.3 million and includes 2.4 million for the amortization of intangible assets related to our Nalink retinib license. Cost of sales for Q1 2025 was 10.6 million. Going forward, we will continue to recognize amortization of the milestone to the license store about 2.4 million per quarter as cost of sales. Fiscal year 2025, Puma anticipates that Nalink's product revenue will be in the range of 192 to 198 million. We also anticipate that our gross net adjustment for the full year 2025 will be between .5% and 22%, higher than prior guidance due to an increase in government's chargeback expenses. In addition, for fiscal year 2025, we anticipate receiving royalties from our partners around the world in the range of 20 to 24 million. Lower than 2024 due to fewer shipments expected to China as our partner works through regulatory transitions during the first several quarters of 2025. We don't expect licensed revenue in 2025. We also expect that net income for the full year will be in the range of 23 to 28 million. We are not forecasting any potential release of any additional tax asset valuation allowance in our net income estimate at this time. However, this will be evaluated on an ongoing basis. We will continue to keep investors updated on this as it progresses. At this time, we do not believe that the tariffs imposed or proposed to be imposed by the United States, particularly with other countries, will have a material impact on our product costs or results of operations. However, shift and trade policies in the United States and other countries have been rapidly evolving and are difficult to predict. As a point of reference, our manufacturing product cost accounts for a mid to high single digit percentage of our total cost of goods sold. We anticipate that for Q3 2025, Nalink's product revenue net will be in the range of 46 to 48 million. Also, we expect Q3 royalty revenues will be in the range of two to three million and no licensed revenue. We further estimate that the gross net adjustment in Q3 2025 will be approximately .5% to 23.5%. Puma anticipates Q3 net income between two million and four million. S&G expenses were 18 million in the second quarter of 2025 compared to 17.6 million in the first quarter. S&G expenses included non-cash charges for stock based compensation of one million for Q2 and 1.2 million for Q1 2025. Research and development expenses were 15.5 million in the second quarter of 2025, an increase from the 13.8 million in the first quarter. R&D expenses included non-cash charges for stock based compensation of 0.6 million in the second quarter of 2025 compared to 0.8 million in the first quarter. On the expense side, Puma anticipates flat to slightly higher total operating expenses in 2025 compared to 2024. More specifically, we anticipate S&G expenses to decrease by five to 10% and R&D expenses to increase by 20 to 25% year over year. The higher increase in R&D is driven by faster enrollments in our clinical trials than previously expected. In the second quarter of 2025, Puma reported cash earned of about 2.9 million. This compares to cash burned of approximately 7.8 million in Q1. Please note that during Q2, we made our fifth principal long payment of 11.1 million related to our obligation with Ethereum. As a result of this, our total outstanding principal debt balance decreased to approximately 45 million. June 30th, 2025, we had approximately 96 million in cash, cash equivalents and marketable securities versus about 101 million a year end 2024. Our accounts receivables balance was 25.9 million. Our accounts receivable terms range between 10 and 68 days while our day sales outstandings are about 50 days. We estimate that as of June 30th, 2025, our distribution network maintained approximately three weeks of inventory. Overall, we continue to deploy our financial resources to focus on the commercialization of Neuralink, the developers of Alicertive and controlling our expenses.

Thanks, Maximo. Puma Senior Management in cooperation with board of directors continues to remain focused on Neuralink sales trends in 2025 and beyond and recognizes its fiscal responsibility to the shareholders to continue to maintain positive net income. We are pleased to report demand driven growth in Neuralink sales in the first half of 2025 and we believe that the positive net income that the company achieved in Q2 2025 and the company is guiding to for the full year 2025 resulted from the financial discipline across the company over the last three years. The company remains committed to continuing to achieve this positive net income and will continue to reduce expenses if needed to achieve this. We look forward to updating investors on this in the future. There continues to remain a significant unmet medical need for patients battling breast cancer, lung cancer and other solid tumors. Puma are committed and passionate about finding more effective ways and helping these patients during their journey and we will continue to strive to achieve that goal. This concludes today's presentation. We will now turn the floor back to the operator for Q&A. Operator.

Thank you. We will now begin the question and answer session. If you wish to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. If you wish to withdraw your question, please press star two. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment please while we poll for questions. Your first question comes from Mark Forham with TD Cowan. Please proceed.

Thanks for taking my questions. Maybe on the R&D side, you mentioned two data disclosures coming up later this year. One, just the venue for that. Do you expect those to be at medical meetings or there's more likely to be corporate updates? And then maybe more importantly is, how do you view the budget for the future bar there for what justifies further advancement on either side? And how does meeting or unfortunately falling short of those bars impact the strategic views when you talk about continuing to look at and licensing additional products?

Yeah, Mark, thanks for the question. Okay, so in terms of the venue, I think we'd probably do it as a corporate update. Not sure if we'd do it on an earnings call or something more formal, like just a separate presentation to discuss it, but something in a venue, I would gauge November, December timeframe for that to kind of further go into a little more detail on that. On the small cell lung study, I would guess we would probably have somewhere in the neighborhood of 40-ish patients treated at 50 milligrams that we can talk about the safety, the efficacy, and the biomarkers on. We're just now enrolling at 60 milligrams, so not sure if we'd have enough data on that

yet.

On the breast, we would probably by year-end timeframe have say 40 to 45 patients across the three arms, so like 14 to 15 in each, and be able to discuss the safety, efficacy, and biomarkers on those. With the breast, because it's enrolling a lot faster than we expected, I think it might be a little bit of a challenge to get all the data in by year-end, so that might get pushed to 26, but we'll do our best to try to deliver that. To answer your question in terms of development, so in terms of the path in small cell lung cancer, there was a previous study done, which was the general thoracic oncology study, which was the randomized study of Pacloaxal Plus Alicertib against Pacloaxal Plus placebo. In groups that had biomarkers that were known to have a role in a raw kinase, looked at retrospectively, and that included like CMIC, RB1, et cetera, you did see via retrospective analysis a PFS benefit and an OS benefit. So our assumption always was when we bought the drug, we were only looking at it in the tumors where the raw kinase pathway played a role. The question we had was were we seeing this benefit in that randomized study, because Alicertib had selective activity, or that for some reason there was preclinical data that Alicertib could increase the PKF Pacloaxal and increase the sensitivity, was that just what we were seeing? So as you said in the monotherapy study, we are indeed seeing a benefit of Alicertib in the patients with the biomarker selected for those selected for the raw kinase pathway. To answer your question on the bar, look, you have a trial which is Pacloaxal Plus Alicertib against Pacloaxal Placebo. Whatever that magnitude of a benefit is, we would hope with the monotherapy to see a similar benefit in PFS, right? If you're not seeing a PFS benefit, it would be difficult to get an OS benefit, so you gotta get both. And I think from an approval standpoint, it's clear in small cell lung cancer you're gonna need a PFS benefit, and most likely an OS. So to answer your question, that would be the threshold to take forward. On the breast side, there's not a pathway in ER-positive breast to get approval based on response rate. It's gotta be PFS and OS. So I think, again, we would need to see a PFS in that third line setting. That would be something we would want to invest in and take forward. That would clearly need to be something better than what is being seen with the endocrine alone. And again, I think we would again look to, most likely try to develop that in power marker subgroups where the auricinus pathway plays a role. And the last part of your question, should any of those fall short? Would we immediately go run out and try to bring something else in? No, we would probably wanna be selective. Look, being a profitable company, we 100% recognize our fiscal responsibility to the shareholders. Spending money on projects that aren't going to result in a benefit to patients, and hence a benefit to shareholders, that's not something we're looking to do.

Okay, that's a, I mean, I was about to ask the other direction also as well. Like if you do meet those bars, next steps in one or two tumor types, is that enough that you maybe wouldn't be very interested in bringing in additional products as well?

Oh, to be honest with Mark, look, there's a lot of things out there we could bring in. And to be honest, that's both on the commercial side and on the development side. Having been a profitable company now for what I've gone on, three, four years, it allows you to be in control of your own destiny. And I think that's something that we like, and we like having the ability to tell shareholders that we don't need any additional capital and we have enough to get this, you know, in our models, we have enough to get Alicertib to the market just through our own commercial efforts and investing the profits from Neerlinks in Alicertib. I really wouldn't want to do anything, as we've said in the speech many times, that makes this company unprofitable. Just not something we would want to do. So, and that's true both in terms of bringing in additional commercial assets and bringing in, and or bringing in a development stage one.

Okay, that's helpful. Thank you. Sure.

Thank you. This concludes our question and answer session. I would like to turn the conference back to Mary Ann for closing remarks.

Thank you all for joining us today. As a reminder, this webcast may be accessed by a replay at PumaBiotechnology.com beginning later today. Have a good evening.

Ladies and gentlemen, thank you for participating in today's conference call. This concludes our program. Everyone have a great day. You may now disconnect.