Theratechnologies Inc.

Good day, and welcome to the Thera Technologies Q3 2023 Earnings Conference Call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star, then one on your touchtone phone. To withdraw your question, please press star, then two. Please note this event is being recorded. I would now like to turn the conference over to John Mullaly. Please go ahead.

Thank you, operator, and good morning, everyone. On the call today will be Thera Technologies President and Chief Executive Officer, Mr. Paul Levesque, and Senior Vice President and Chief Financial Officer, Mr. Philip Dubuc. During the Q&A session, we'll be joined by Dr. Christian Morsalis, Senior Vice President and Chief Medical Officer, and Mr. John Leisure, the company's global commercial officer. Before we begin, I'd like to remind everyone that remarks today contain forward-looking statements regarding the company's current and future plans, expectations, and intentions with respect to future events. Forward-looking statements are based on assumptions, and there are risks that results obtained by Thera Technologies may differ materially from those statements. As such, the company cannot guarantee any forward-looking statements will materialize, and you are cautioned not to place undue reliance on them. The company refers current and potential investors to the forward-looking information section of Thera Technologies Management Discussion and Analysis issued this morning and available on CEDAR, www.cedarplus.ca, and on EDGAR at www.sec.gov. Forward-looking statements represent Thera Technologies' expectations as of this morning, September 26, 2023. Additionally, today the company is using the term adjusted EBITDA, which is not a financial measure under International Financial Reporting Standards, IFRS, or U.S. Generally Accepted Accounting Principles, U.S. GAAP. Adjusted EBITDA excludes the effects of items that primarily reflect the impact of long-term investments and financing decisions rather than the results of day-to-day operations. Thera Technologies believes that this measure can be a useful indicator of its operational performance and financial condition from one period to another. The company uses this non-IFRS measure to make financial, strategic, and operating decisions. Reconciliation of adjusted EBITDA to net loss is found in our MD&A issued this morning, available on CEDAR and on Egger at the web addresses mentioned earlier. Investors can also follow the company on LinkedIn and Twitter and sign up for alerts on Theratechnology's investor website at theratech.com. With that, I would now like to turn the conference over to Theratechnology's President and CEO, Paul Levesque.

Thank you, John. Hello, everyone, and good morning. I'm pleased to report that we have made fantastic headway across our strategic objectives, as outlined in this morning's press release. Our financial and operational planning for the remainder of the year and into 2024 is well in hand. And in spite of headwinds in the last quarter, we have learned much from both our successes and setbacks. which is exactly why we are pleased to report a positive outlook for the remainder of the year. For example, our quarterly revenue has demonstrated a solid recovery from the most recent period, and we've crossed major milestones in the development of our pipeline and the lifecycle management of our products. With that, today's call will be quick and straight to the point, as our primary goals in the near and medium term are clear and remain set. I want to remind everyone that our sights are zeroed in on advancing the objectives that drive the whole of our business forward, and most importantly, to maintain a strong cash balance and discipline around long-term financial objectives. In this arena, we are laser-focused on revenue strength and improvements to our bottom line. We have and will continue to be stringent with our operating expenses so that the adjusted EBITDA profitability we have just reported is a fixture of our ongoing financial plan. This is core to our success and I cannot emphasize it enough. We also strongly believe that our pipeline progress cannot and should not be underestimated. We are executing on the promise of extending future revenue generation of the commercial business through line extensions of our HIV products, in particular with the FDA submission of the IGRIFTA F8 formulation, which we announced yesterday. We are also committed to capitalizing on the development of our lead anti-cancer agent, Pseudocetaxels and Dusortide. As you know, we are working hard to meet phase one clinical trial milestone timelines and report results as quickly as possible in 2024. I would also like to mention a goal that is very important tied to our operational planning, which is respecting our debt covenants with our lender. I am so pleased to share that we have worked together with Marathon to modify our covenants as our story progresses. These important changes include, among others, removing the increase in the liquidity covenant, which would have stepped up to $30 million should the F-8 not be approved before March 31, 2024, changing the revenue covenant to an adjusted EBITDA base covenant, and changing the liquidity requirements down to $15 million over time as our adjusted EBITDA increases. These adjustments to the loan covenants can be seen as a testament to the rising confidence in our ability to execute on the company's stated goals for the year, Additionally, the new terms will allow their technologies greater flexibility in our quest to deliver better profitability and even stronger financial health. Jumping into our financial progress, in July, we announced measures to realize a $5.5 million in cost reduction for 2024. But through tight expense management, we are already seeing the impact of this measure. We're happy to report that we recorded adjusted EBITDA of $2.2 million in the third quarter. Not only was this critical milestone achieved far before the end of the fiscal year, which was promised in January, but it also marks a significant improvement quarter over quarter. These results put the company in a positive adjusted EBITDA range of 10% of revenues, and we are confident this figure can be improved in the coming quarters. This is the result of a significant reduction in R&D and operational expenses. And now with the completion of a number of key projects, such as studies required for our FDA submissions, significant expenses are behind us. This profitability gives us the agility to seek favorable terms across our strategic endeavors, even accelerating our top line. To elaborate further, our U.S. commercial capabilities are primed to scale up for bolt-on accretive products and new partnerships. Our fixed costs are also optimized and we anticipate ongoing future leverage as we increase the intrinsic value of our technologies. Additionally, we can confidently move forward with the 2024 launch plans of our approved commercial products. Let's take a closer look at our HIV business. For fiscal year 2023, we are tightening our guidance, expecting to finish the year with revenues of $82 million to $85 million. Our top line has recovered, and we report third quarter revenues of $21 million up from a very difficult second quarter that was impacted by buildup of inventory, as previously discussed. In the third quarter, new prescription growth continued on a strong path. and we expect results to follow in Q4 of this year and into next year. Just yesterday, we announced another commercial milestone, having filed the SDLA applications for the new generation of EGRF-Dice-V, the FA formulation with the FDA. In accordance with the agency's filing review period, Ferrate Technologies expects to receive an acknowledgement letter within 30 days, along with the PDUFA goal date. As discussed in the previous quarter, The new formulation has several improvements over prior generations, including frequency of reconstitution, and will immediately replace the current F4 formulation once launched. The F8 formulation is patent protected until 2033 in the U.S. and will support revenue growth in 2024 and beyond. And this is coming at the right time. In our interactions with HIV healthcare providers, we are seeing an increased interest in identifying and treating patients with excess visceral fat. The same momentum holds true for innovations with trigarzo. Following completion of the intramuscular study, we are analyzing the data and are on track for a Q4 filing of an S-BLA seeking approval for trigarzo-IM. In the meantime, we are awaiting FDA approval for IV push administration of the Tregarzo loading dose, a decision which is expected in mid-December. We believe the introduction of the simplified first dose of Tregarzo by IV push, followed by the eventual option for IM administration, will help minimize the daily pill burden for multidrug-resistant patients and serve as a gateway for new trigorzo scripts in combination with other injectable therapies. Wrapping up with oncology and where clinical trial progress is on track, you saw from the press release issued on August 30th that all five of the US-based pseudocytac cell Xenusortide Phase I clinical trial sites have been activated to simultaneously screen, enroll, and dose advanced ovarian cancer patients. A six-site base in Canada is finalizing its startup activity. Full details about the study design, participation criteria, and contact information for the sites can be found on clinicaltrials.gov. I am pleased to share that we already have a number of patients consented and actively being screened, and we look forward to announcing the first patient dose shortly. Additionally, investment in our oncology program remains stage-gated, with funding for the dosing of the 16 Phase I trial patients firmly embedded in our 23 and 24 budgets. Partnering discussions continue for the additional phases of development of Pseudocetaxel's endosortide. Looking ahead, we expect a first interim analysis for preliminary safety and efficacy data from the study by mid-year 2024. Finally, our NASH asset is still in play, and we remain open to research partnerships as the environment for metabolic therapies is opening up. With this, I'd like to turn the call over to Philippe, who will be going over the period's financials in detail. Philippe?