Elite Pharms Inc

Good morning, ladies and gentlemen, and welcome to the Elite Pharmaceuticals conference call. At this time, all lines have been placed on a listen-only mode. Before management begins speaking, the conference has the following statement. Elite would like to remind the listeners that remarks made during this call may contain forward-looking statements that involve risks and uncertainties that are subject to change at any time including but not limited to statements about elite expectations regarding forward operating results. Forward-looking statements are made pursuant to the safe harbor provisions of the federal securities laws and represent management's current expectations. Actual results may differ materially. Elite disclaims any obligation to update or revise its forward-looking statements, except as required by law. More complete information regarding forward-looking statements, risks and uncertainties can be found in the report Elite Files with the SEC, which is available on Elite's website at ElitePharma.com under the Investor Relations section. Elite encourages you to review these documents carefully. With that covered, it is now my pleasure to turn the floor over to your host, Mr. Nasrat Hakeem, President and Chief Executive Officer of Elite Pharmaceuticals. Sir, the floor is yours.

Thank you, Jenny, and good morning, ladies and gentlemen, and thank you for joining us today. My name is Nasrat Hakeem. I am Elite's Chairman and CEO. This is our earnings call. Our CFO, Carter Ward, will give us a summary of the company's financials, after which I'll give you an update and answer some of the questions that you submitted to Diane. Mr. Ward, you have the floor.

Thank you, Nazrat, and thanks to everybody calling in. We had to wait a few extra minutes to have such a big crowd calling in, so we really appreciate your interest. Thank you again for calling in. Yesterday we filed our 10-K. That's the annual report. We're on a fiscal year, a March fiscal year. So it's for the fiscal year ending March 31st, 2025. That's our 2025 fiscal year. The report's available at our website, ElitePharma.com, under the Investor Relations section. If you haven't seen it yet, please get a copy and take a look. As always, I'm going to provide some context and a little color to the financial statements and also answer finance questions that we received overnight as well. I'll answer that throughout my presentation. Let's start with the P&L. Total revenues for the 2025 fiscal year were $84 million. You compare that to 56.6 million for the prior year, March 2024 fiscal year. That is a $27.9 million increase, or 52%. There's two main factors that contributed to the increase. First, the elite label has become well-established in our niche markets. The 2024 fiscal year is when we launched our elite label. That was the first year. We were an unknown net. We did well in 2024 and throughout 2025. We've now solidified our place in the market. We've expanded our market share, and we're no longer unknown. We are a known entity in the market. And we have distinguished ourselves as a reliable supplier of quality product, and that equals increased revenues. The second main factor is the launch of our Lizdex Amphetamine product line during the last quarter of this fiscal year, so January to March quarter. Lizdex Amphetamine is the generic for Vyvanse. It's a very large market with high demand. The flip side, there's also quite a bit of competition in that market, more than 10 suppliers currently in the market. Now, we've done a really good job. We've grabbed a decent share of the market, as reflected in the P&L statement. One thing to keep in mind, though, the Lizdex market remains highly competitive. Our good name in the industry goes far, but it only goes so far. So we're doing very well with this product, but this is generic pharmaceuticals. It's an industry which is defined by tough competition, and Lizdex is a typical generic product when it comes to those characteristics. More than 10 suppliers in the market, that equals price pressure. There's quota pressure because this is a Class II product, all of the factors that are typical to the generic market. Kirkle is doing, he's our chief commercial officer. Kirkle is doing a great job, but this is generic, and that saying about past performance not guaranteeing future results is a part of the fabric of this industry. That being said, we are doing excellent with Liz Beck's incentive. Moving down to P&L, our operating income was, $19.6 million. That's our income, our profit. Compare that to $10.8 million for the 2024 fiscal year. That's an $8.8 million increase or 82%, almost doubling profits. Now, I got a question that I received. pretty much every quarter and that's regarding there's an item on our P&L below the line that's called change in fair value of derivatives. Now this is related to the valuation of warrants that were issued in 2017. It's a non-cash technical entry required by GAAP. It has to do with the valuation of the warrants. If the valuation of the warrant goes up, we record an expense and we increase liability. On the flip side, if the valuation goes down, we record income, and we decrease the liability. How do we value it? We value it using the Black-Scholes model, which essentially means that if our stock price increases, the valuation will also increase, and therefore we book an expense. If the stock price goes down, the opposite happens. We book income. During the fiscal 2025 year, this year, our stock price almost tripled. We went from 15 cents to 44 cents, and we're very grateful for that. It's a good thing. But when you run that through the Black-Scholes model, the result is an increase in valuation of approximately $18.9 million, and that's the expense we show on the P&L. The most important thing to take away here is that we will never pay cash for any expense shown And the flip side is we also will never receive cash if the stock price goes down and we report income. So it's a non-cash expense and a non-cash income item. There's no cash ever associated with this. This is a technical gap book entry. Please also note that our stock price today is much higher than it was even three months ago. On March 31st, it was 44 cents. So the next 10Q, the one for the quarter just ended, Q2025, we're going to show another expense for change in share value of derivatives as a result of the further increase in the stock price. Another thing to note that with the $18.9 million change in derivative value, it resulted in Elite having a pre-tax loss of $52,000. Despite showing a pre-tax loss, we still booked income tax expense $4.3 million. And I got a question on that. How do we have an income tax expense if we show a pre-tax loss? Well, the answer is that the $18.9 million expense is not deductible for tax purposes. The IRS and the state tax authorities, they don't recognize this as an expense when it comes to taxes. So I'll also add that this item is also not considered in any enterprise valuation models either. It something you have to do for GAAP. Got a question on earnings per share. Wanting to know what is our earnings per share? Well, that's listed right on our P&L statement towards the bottom. The EPS for this year, 2025, was zero. And last year, it was two cents. Now, the EPS includes all of those below-the-line items. So this year, we had that $18.9 million gap. change in valuation, which is a negative as far as EPS. That's why the EPS went down to zero. Last year, we had the release of a deferred tax valuation allowance, the asset valuation allowance. That was approximately $19 million in income. Again, a non-cash item, but that increases EPS. That's a positive to EPS. So keep those things in mind when you're looking at the EPS. Take a look at the below-the-line items and know that they are in peace. And now for the cash flow statement, our operating cash flow this year was positive $7.5 million. That's compared to a cash burn last year of $3.2 million. So that's a $10.7 million swing to the positive. Now in 2024, last year we just launched the elite label and then That means we have investments in inventory, receivables, so increases in inventory, increases in receivables, and those are dragged from cash flow. And those, in last year, those total $20 million. So that's the reason for the burn in 2024. This year, we continue to expand the market share. We launched the LISDX, and the inventory and receivables continue to rise, which is a good thing because that portends to future revenues. But it is a drag on cash flow. Those increases were 13.2 million. That's 6.8 million less than the 20 million in the prior year, but it's also less than the 10.7 million positive trend in cash flow, meaning that this doesn't fully explain how we went from 3 million burns to 7 million positives. The factor that bridges these two is the profits. Remember, operating profits were up 8.8 million. Profits are a major driver of cash flows and profits are the reason that we are in business. So we buy inventory, we sell, we increase our receivables, we collect every time. We call that a rotation. Everything is to the positive and eventually it's going to result in cash flow and it has. So now to the balance sheet. This is a good segue because the balance sheet continues to strengthen. I looked over some of my prior presentations, and I've been saying that for quite a while now. So our balance sheet continues to strengthen, which is a great thing. Our working capital as of March 31, 2025, was $45.9 million. You can compare that to $27 million as of March 2024. That's a $19 million increase of 41%. Drill down further into working capital. Remember, working capital is current assets minus current liabilities. Our current assets increased from $40 million in 2024 to $58 million this year. And then for the current liabilities, they decreased from $13 million in 2024 to $12 million this year. So you don't see that too often. Current assets increasing by $18 million with current liabilities actually decreasing. You can expand that analysis even further, and you look at the non-current liability, you're going to see a similar trend. Our non-current liability, excluding the derivatives, the non-cash, was $5.8 million this year compared to $6.7 million in 2024. So that's a decrease of $900,000. The takeaway here is that Elite has low debt, and it continues to decrease. Our debt continues to decrease. We have low debt, decreasing debt, combined with increasing working capital. Both things you want to see, and both are hallmarks of a strong balance sheet. So this is what I mean when I say our balance sheet continues to shrink. That's what I look at. Also received a question on when we are paying the loans, which are owed to Nasrat and one of our directors, Davis Kasky. If you look on our financial statements, there's a subsequent event section, I think it's note 17, and it says that we have paid those loans to Nasrat and to Davis Caskey. They've been repaid after March 31st, so as of March 31st, we still owe the money. It's on our financial statement, but it's no longer owed, and going forward, you'll no longer see those liabilities on our balance sheet. That loan gave us Working capital, that was about two years ago when we were just starting with the process of launching the elite label. So that loan gave us the working capital that kick-started the elite label. And you see how well that's worked out. And that working capital was crucial in this success. So Nasrat and Davis provided that money just when we needed it at the perfect time, and it worked out extremely well. And that's one of the Good things about working here, one of the things I enjoy, working with Nasrat and having such support from him and our entire board of directors. Really great working with them. I have a few more questions that I received before I wrap it up here. Will Elite be an accelerated filer in fiscal 2026, the fiscal year that we're currently in? To be an accelerated filer, The main criteria that we would have to meet is, that we haven't already met, is we need more than $100 million in annual revenue to be an accelerated file. So let's see how that plays out. Just something that we're monitoring. Does the LEAP plan to change to calendar year reporting? We get that question a lot, and the answer to that is no. We are focusing on other areas. that provides greater shareholder value than changing the reporting period. We're not going to extend the resources or the time and the focus on that. We're doing that elsewhere. So some of these financials are record revenue. We had record revenues this year above the record revenues from last year. This year we crossed $80 million for the first time. We had record profits, just over $20 million in profits. It's clear that the elite label is establishing itself in the market. The LISDEX launch was extremely successful and continues. Our balance sheet is strengthening. Our cash flow is solid. Working capital is increasing. Debt is decreasing. So put that all together, I'd say it was a good year. It was a really good year. Our next quarterly report is due in August, and we'll have more to say then. Now, I'd like to introduce our chairman and CEO, Mr. Nasraf Hakim.

Thank you, Carter, for this wonderful news. Just to recap some of the things that Carter said and take it up a notch. Elite continues on a strong growth trajectory. Our revenues for fiscal year 2025 were $84 million, like you heard, 52% growth over the year before. Operating income from 2025 was 19.6, and that's an increase of 82% over the year before. Another record year for Elite. I've been saying that for five years now. Operating profits grew from 2.1 million in 2021 to 10.8 last year and 19.6 this year. 2.1 in 21 to 19.6 this year. Revenues grew from 25 million in 21 to 57 last year and 84 million this year. Not too long ago, Elite's revenues were 7.5 million for the entire year, not a quarter, for the entire year. And the stock was lingering between 3 to 5 cents, about 4 on the average. A $100,000 investment in Elite back then would have generated $1.5 million today. That's nice. $100,000, you would have bought a nice car. One and a half million dollars, you'll buy a house and a couple of nice cars. Now, just to reiterate what I've said before in previous calls, I'm not saying this and I'm not asking anybody to buy or sell elite stock. That decision to invest or not to invest is between you and your financial advisor. I'm not crazy about people that invest in the stock and they come crying to me and they think they're brilliant. This is between you and your financial advisor. Whether you invest or not, it's your decision. Our job is to report the numbers that we've generated by how our teams have worked. Any way you look at it, It's an outstanding growth, and our stock price reflects it. The recent growth comes from our launch of Lisdex amphetamine and strong results from our existing commercial products, including the mixed amphetamine IR and IR. Don't want to lose sight of that. Lisdex is the new kid on the block. That's it. Our foundation has been the legacy products, post-amphetamine, IR and ER, up to now. Think of elite as revenues as coming from three sources, the old legacy products, amphetamine, IR, ER, and Listex. Listex was launched in January. It's a central nervous system stimulus used for attention deficit disorder. The brand is Vyvanse, and the IQV are appropriate annual sales of over $3.5 billion based on NSC for this product. The market volume for LISTEX is growing still due to continuing grant-to-generic conversion, and I'll explain that in a second. Overall market growth due to increased scripts because anytime the company becomes generic, more doctors write it up and because more insurance companies allow it. The generics have about 68% of the market years to date in 2025. That's up from 53% in 2024. Those numbers are impressive that the brand is still holding onto that much. And that's because of the CODA and other issues. But what you can see is that further market penetration by the generics is expected. Usually when a product becomes generic, it drops by 90% in sales from the brand and becomes all generic and then it expands more because more doctors are stripped. In this case, it has not happened because of CODA and the fact that the brand, received a huge quota last fall. As the market generalizes, the price competition is increasing so that the margins will go down. But the margins continue to be very attractive. We have 13 companies that are active competitors in the market right now. Elite currently has about to 10% of the market according to IQBio. When you have 13 companies that are fighting for this huge product and Little Elite gets 8 to 10, that's an excellent solid start. In addition to ListX, our existing products are doing very well, starting with a generic Adderall IR. The IQVIA reported annual sales for Adderall IR of $400 million based on MSP, and they reported a market share of the IR to be about 20%. Again, that's an old molecular entity. This product has been around for a long time, and the market is stable, and we're doing that well now. This is a strong product for us. Another very important product is Generic Adderall XR. The IQVIA report annual sales for this is 800 million based on NSP, and we command 16% of the market according to IQVIA, 11% on Elite's label, and five under the Borel Pharma label, which is Presto. Now, note that Presco's non-exclusive license for amphetamine are in-bid in March 31st, but they are selling out their remaining inventory. It ended in March, but they still have a lot of material that they are still selling to today. Going forward, once they are depleted, they need to sell this product exclusively under our label. The next set is the legacy products. There are small market size, but Elite has strong market shares with attractive margins for these small products. Example for even though they are small, the margins are not bad, and we recommend about 50% of the market. Precision dose license for genetic naltrexone and phentermine tablets and capsules ends in September. At that time, Elite will begin selling these products exclusively under our label, but nevertheless, as of today, that is still a part of our legacy products, the bariatrics and naltrexone that TAGI and PrecisionDone have been selling for a while. Other than these three categories, we also have What we've launched recently, and they're still working on, we've launched generic methotrexate. It's a small product, $40 million of MSP, according to IQVIA. We have a minor share of the market in that. Generic oxy-APAP, that's the brand for Percocet. The IQVIA report annual sales of $300 million per year for this product. And for hydro-APAP, the brand is noto. IQBR reports 325 million in sales. The leaders beginning to build market shares in these products. These products are large lots, easily accessible, lots of players, and small profit margins, and that's why we have not been as aggressive with them. They're going to take up a lot of lab time, a lot of equipment, And we will get around to them, but we have bigger fish to fry. We have the less taxes of this world, and the entrepreneur and IRM are. Generic Cuisine and APAD, which will launch in October, has a growing market share, which is currently at this dollar share of 5%. It's a $50 million product according to MSP. We are at about 5%, and we will continue to grow that market. In the near future, sometime this year, we have methadone to get through validation and launch, and we have not given it a priority because, again, once LIFTAC hit the market, that became the number one priority, but that will be coming sometime this year. The IQBR data for that is about $20 million, according to MSP. Our partner, Dexel, which received last October for approval from the Israeli government, they have received, meaning they picked up, their first order from Aliq. We don't know if they shipped it or when it's going to get there, but when it gets there, the products will be launched. They have also put in for a second order for later this year. Dexel provides the sales and marketing and distribution for Elite's product, and Petunia and I are, which we will manufacture and package for them. They pay a transfer price for the product, and Elite will share them the profit when the sales prices exceed certain amount. We have a three-year agreement with Dexel, and it is renewable for two additional years, and everything after that is negotiable. In our development pipeline, we have two . Generic Oxy-ER, whose brand is Oxycontin, it's a paragraph four filing, and the patent lawsuit is on the way. by multiple companies against Purdue. We are waiting to see what happens in court. And from our side, we have been extremely smart. Dr. Ken Smith handled this brilliantly. We have tried to avoid being the part of the lawsuits and let everybody duke it out while we don't spend any money on lawsuits. And so far, we've been successful. But now, it's time to play some music. Last week we filed a motion to dismiss against Purdue. Most likely the judge will reject it and we'll have to go to discovery sometime in two, three months. But we are trying to delay the process from having to spend money on this and let other companies get out for as far and as long as we can. The second is the dopamine agonist, ANDA, for the treatment of Parkinson's. We are due to respond to FDA inquiries very soon by August, I believe, and then the FDA will make a decision whether they have more questions or we can move forward. We will update you and update everyone on these products as they receive approval. We recently announced the successful DE study for undisclosed anticoagulant, i.e., Bloxamide. That is, the brand has not gone generic yet. The annual sales are 27 billion, according to Acuvia, and the market has not been generous yet. There is no generic in the market by anybody. The brand has unexpired patent listed in the Orange Book, and of course, everybody has to wait until these patents are overcome, they are unexpired, or somebody has to challenge them and try to, We expect to submit the ANDA probably in Q1 of 2026. We have stability work to do. We are working hard on R&D. Elite has other genetic products expected to enter DE studies, but we got to make sure we have finalized simulation for these other products before we enter DE study. We need to make sure that the testing is robust. the clinical batches with strength stability, and no unexpected issues come up. DE studies are not cheap, and we need to make sure before we start one, and we can start the pilot, but start the DE study, we need to make sure that all of our bugs are in the room. We continue to make R&D priority, and we will update everyone on these products upon the successful completion of a DE study like we did with the . As far as our facilities are concerned, and there will be a Q&A about that, our 34,000 square foot state-of-the-art inventory and packaging expansion is operational. With this expansion, Elise has the capacity for all of our products coming to Elise to be able to be packaged here for the next five years. Right now, running only one shift, we have more capacity in that facility to be able to package everything that we have. Just on one shift. Just to summarize, Elite's idea of terms of growth continues. Elite is executing its strategy of developing and filing new andes and growing sales while supporting our working capital growth and pipeline development. The increase in the ELTP stock price reflects this growth. LIFTX is expected to continue to be a key product for Elite with attractive margin over the next year as this market continues its conversion to generics. And for the mean IR and ER is a mature market and we expect to successfully defend our strong market shares. And then, and for the mean ER is expected to grow after is phased out. Elite is positioned as an attractive, mid-sized, generic pharmaceutical company with consistent profits, steady growth, and low debt. Our stock price has been strong, and we continue to evaluate acquisition options and alternatives, including a to NASDAQ. And we will report back when we have material events to report. Let's go to Q&A. We have lots of questions, and none of them was really good because they were redundant, so a lot of people are interested in the same thing. We have lots of questions, but they come in different categories, so we've divided them up for you for general. The, of course, a lot of questions about the anticoagulants. partnership which is Excel, potential sale of the company. So that's how I'm going to go through them in the form that I just listed. We'll start first with the general stock and go down the list and we address finally the potential merger and acquisition. First question is from a gentleman who's asking when is ELECT planning to apply with the FDA for the greater expansion of the manufacturing capacity of other block states besides tablets and capsules. And the reason behind this and few other people ask about the same subject is the gentleman is a vet who used ketamine in his practice and recommends that we explore it. Ketamine is an injectable product and it's also available as inhaler. It's not a tablet of a capsule that's approved by FDA, but I know that people compound it into a or a solid doses for the animals or for humans. This will be an original NDA, new drug application, or at the very least a 505 NDA. So this is going to be a long-term project to explore. And thank you for that. Another gentleman sent us a list of the top ten blockbuster drugs with the patterns expiring in 2025. I do appreciate the positive ideas and interaction with our stockholders. I thank you both, and please keep them coming. This is the kind of feedback that I really appreciate. People are thinking positively and giving us positive feedback. Can you provide an update on the old packaging line moving to the new facility and any updates regarding the new manufacturing suites that are to take their place at the old facility? Yes, so let's break it into two. The first one, we have moved the old packaging line into the new facility after we made sure that the new packaging line is working. So first, we set up the new packaging line. We transferred over there, but we left the old packaging line in its place just in case of something that's wrong. And sure enough, after two, three months, because of serialization and other issues, we started noticing anomalies. We immediately stopped and we went back to the old line, got all the engineers that sold us all the equipment to come in and troubleshoot. They fixed the whole thing, but did it again. It's been running great, so we went ahead and transferred the old packaging line to the new facility. So now, in the new facility, we have two packaging lines, which free up the space where it used to be. We have not purchased any equipment or done anything in that space yet. We've barely just stripped it. It takes a little bit of time, but that's what we've done. What can you say about the API shortage reported to FDA and DEA? Well, we are required to report to the FDA on product shortage, whether it is a controlled substance or not. For example, nitroxone is not a controlled substance. We have to notify our suppliers a few months ago that they're not going to have anything left from January, February to June, July due to API shortage on their part. The API that goes into making our API. So we have to report that to the FDA. Other shortages happen because of quota issues. When you sell all of your quota and then you can sell anymore, people will call in and they want to buy a product, and you have to tell the FDA, I only have limited amounts of people that I've committed to, and that's about it. So that's what I believe you're referring to. We have to report that on most of the pages, and we're very honest and not frank about it. Latest pharma and pharma turfs impact, do we have any impact from these turfs? As of today, the active pharmaceutical ingredients we have imported are exempt from the Trump turfs. Also, our imported APIs were and continue to be duty-free. We have not felt it on the API. There were other little issues where some pricing pieces are here and there, but overall it has not been viewed as that material. Predictions for the 2026 and 2027 annual reviews, annual revenues of current and other approved generics, we're not going to do projections down the line because we don't know. Okay. Lots of questions about this. I will read some of them just to show you the trend and so you can understand your question. And then I'll answer all of them as a package. Lots of questions about that. Please tell us more about the $27 billion bill. Moving forward, elite is to go ahead of our competitors to be first to file and get the 180-day exclusivity. Does elite anticipate any potential litigation? Has elite communicated with the patent holder and then the holder? What are the patent challenges noted in the press release? What percentage of the market for 2027 generic anti-coagulant can elute realistically capture? Realistically, I can't answer that. We haven't even filed the application. Okay. Let me go through the others by and large. It's an outstanding product. It's the best anti-coagulant out there, period. It does have a pattern. We are not, I would love to become a paragraph four company, but we are not built for that. We can do one thing and two things, but we're not activists. The unexpired and the litigation and all of this that you're asking about are issues that will be settled after we file. We have to notify the, and the holder that we filed. and we are or are not infringing on your patents. If we are not infringing, they're going to come and look and see that we are not. If we are infringing, I'm a nice guy. We're not going to launch until the patent expires or report to other ones, you know. We're not going to go fight in a battle we're going to lose. So if they have a solid patent, you leave it alone. If it is obvious that something that can be challenged, you challenge it. We will deal with that in a couple of years when we get the approval. Okay. For the 27 billion new anticoagulants just announced, is the branded drug or does the branded drug have foreign patent expiring before U.S. patent? Will ELITE pursue foreign partnership to sell our genetic in foreign market prior to being able to enter the U.S. market? I left this question separately from the others because it was something I was exploring before we got this question, and unfortunately, the answer is no. If it was approved in the U.S., if our application was already approved in the U.S., then I could do that. I will find somebody and we will file with the in Europe and to get an approval. But since we only passed a BE that has not been reviewed by the FDA and they have not approved the application, I cannot do any of that. I'll have to go to Europe, make everything from scratch, file with the , do the whole process, which will take a very long time. I don't mind if we can partner with somebody to do that, but that's not something I'm pursuing at this time. A very, very, very good question, though. My next question is I noticed that under the type of pipeline and generic drugs, the list is empty. Is this because it is done on purpose to protect our secrecy from our competitors? Yes. We don't lift the name because people go shopping and they see what you're doing, and then they start making the same product. How many potential drugs are actually in our current pipeline, and approximately what's the IQV amount? We have several products in the pipeline, and we'll issue the IQV amount once we pass the DE study or when we file the application. Any good news with R&D in India or elsewhere to expand our pipeline? Another question in the R&D, is it happening soon? The answer is yes, it is happening, but like a lot of things that happen in the industry with the tourists and people getting gun-shy, people from India are not being able to get a visa to the U.S. as easily as they were in the old days. And a part of our strategy with the Indians is that they'll develop everything there and then they'll transfer it over here. And even though we've been successful at doing one where a guy came in, the top scientist came in, and we worked on a product, the next set, the two scientists were not able to get a visa, so we're working with them. So the answer is yes. It's not going as fast as I would like it to, but it is happening. Any good news with Dexcel launch and timeline? Yes. As I stated earlier, Dexcel said they are ready to receive the materials, so they came and picked up the inventory. We don't know if it's on ship or when it's going to get there. It's going by plane. But when they launch in Israel, they let us know, and they are ready to send an order for the next shipment in a few months. Potential fail of the company. That's the last group of questions, and we'll start covering those again. I'm going to read some of them because they're redundant, and then I'll address all of them combined. Do we know what course we are seeking, buyout or netback? Our top priority is measure and acquisition, a buyout. If that does not work, then NASDAQ is an option. I am following up on on the most recent quarterly call where he anticipated transferring to being listed on the NASDAQ sooner rather than later. Possibly during the current quarter. Could you please provide me with an update on where we are in the process? I made a point during the last conference call of paying merger and acquisition first, then NASDAQ for a reason. And if we even wanted to, we could invest in NASDAQ in a quarter. There's a lot that goes into being listed in NASDAQ. It's a lot of work. How does NASA feel about getting acquired with a premium added to the acquisition price per share with the potential 25% turf on European emissions. I like it. Sign me up. In fact, once we put a leak out for a bit and a serious offer is made, then at the end of the day, you, the stockholder, will decide whether we sell the company or not. Me, if I like it or not, really. At the end of the day, it's your vote that will decide. Wouldn't every big pharma company want to acquire a company like Elite to avoid the if drugs are manufactured in the US versus waiting five to ten years for a newly built facility to be approved by the FDA to operate and manufacture drugs? Absolutely, you would think so, and we are a very nice fit for many companies. The fact is most companies have their own problems and internal politics and policies and internal agendas. So not too many people will make the initiative, and this is why you need an intermediary, a firm to go and reach out to these people. A lot of people know something is a good deal, but they only take a chance because they lack their job. And I'm out of the field. If it does sell them, they'll be named. But I agree with you. We are a good fit for a lot of companies, and we will see what happens next. Is Elite actively reaching out to all the pharma companies and informing them that we are for sale and ready to be acquired or merged to avoid the cost of the drugs manufactured outside the U.S.? Have any potential to discuss a buyout? Was there any activities around the buyout? Did we hire an M&A firm? Does Elite have a target sale price in mind? Have any suitors come close to this price? Okay. That's not how it works. We don't set a price in mind, and we don't tell people come on down and buy this. We have a firm identified that we are heavily engaged with and have been for a while, but we have not hired them officially yet for the purpose of M&A. Once we do, we are locked in with them for a certain period of time, so we want to make sure they're 100% sure before we move to phase two. There are steps that must be taken before we get to that point. Okay? This is where you start. You start with evaluation. Elite does not do that. We don't say how much reward. We provide paperwork, and somebody else does that. An independent firm performs the evaluation. and they issue an opinion that costs a lot of money, if you ask them. Because that makes them liable that what they are telling is the truth, and other companies will rely on that, including the stockholders, that it has been done properly. Okay? So to summarize everything that everybody's talking about or asking for these 15 questions or so that we got on this subject, our primary objective is M&A. To do so, we need to contract an independent firm, an M&A firm, to conduct valuation of the company. We've done that. This is not an easy task for a growing company like Elite. When you are set an income, it's a lot easier to come up with a value of what you wrote. But when we are growing, it requires different, more complicated models. We have our legacy products that are easy, and the bariatrics. That's an easy assessment. We have . That's not that difficult to evaluate either because we have a good history on them, and they are a mature market with full of history of sales, okay? But you have which we just talked about. and vending products are a lot harder to evaluate. At the end of the day, we get a range representing best and worst case scenario because when they draw models, they don't come up with a single number. They have to say, well, under these conditions, this is what we'll do. Under these conditions, that's what we'll do, and it will have to be arranged. Okay? The process is complicated. And the, it involves a lot, and it involves everybody. So let me walk you very quickly through this. All of the departments in-house, they go through audits themselves, internal audits, by implementing GMPs and checks and balances. The department heads have to monitor the employees and make sure that we're doing everything perfectly. Carter and his team audit all departments internally to make sure he is ready for the external auditors. Auditors like will come in with their team on site and by requesting the electronic documents and audit and his team. The auditors are responsible to their management and the SEC for the cues and cues that we find. And they could be audited by the SEC or they could request to be with lawyers from a separate firm overseeing the whole process. Now, on top of all of this, we need an independent M&A firm that we hire who will audit everybody and then come up with their own projections and models for the valuation. That becomes phase one. Next step is phase two. If the numbers they come up with are agreeable, then we'll give the M&A firm a green light to move forward and find the super. Then the acquiring firm, the one that will do their own valuation and make an offer. They're not going to take anybody's word for it. It doesn't matter how many such imbalances you have. If the offer is reasonable, it will be presented to the board of directors, board of boards, and then upon their approval, you guys are the final say in this process. You make the final decision. You are the stockholders. Okay? We will decide if we will enact phase two within the coming three to four months. By then, we'll have a couple of sales under our belt and a better idea on the valuation. If these options do not look attractive, then and only then, we'll add NASDAQ uplifting to the mix. I hope that was a nice summary, and if anybody has any questions, we are meeting together in six weeks, and we hope to talk to you then. Thank you, ladies and gentlemen, and we'll talk to you in six weeks. Thank you, operators.

Thank you very much. This does conclude today's conference call. You may disconnect your phone lines at this time and have a wonderful rest of the day. We thank you for your participation.