Knight Therapeutics Inc.

Good morning, ladies and gentlemen. My name is Sylvie, and I will be your conference operator today. Welcome to Knight Therapeutics' fourth quarter 2024 results conference call. Before turning the call over to Samara Zakir, President and CEO of Knight, listeners are reminded that portions of today's discussion may, by their nature, necessarily involve risks and uncertainties that could cause actual results to differ materially from those contemplated by the forward-looking statements. The company considers the assumptions on which these forward-looking statements are based to be reasonable at the time they were prepared, but cautions that these assumptions regarding the future events, many of which are beyond the control of the company and its subsidiaries, may ultimately prove to be incorrect. The company and its subsidiaries may ultimately prove to be incorrect The company disclaims any intentions or obligations to update or revise any forward-looking statements, whether a result of new information, future events, except as required by law. We would also like to remind you that questions during today's call will be taken from analysts only. Should there be any further questions, please contact Knight's Investor Relations Department via email to ir at knighttx.com or via phone at 514-484-4483. I would like to remind everyone that this call is being recorded today, March 20th, 2025. And now I would like to turn the meeting over to your host, Samara Zakir. Please go ahead.

Thank you, Sylvie. Good morning, everyone, and welcome to Knight Therapeutics' fourth quarter and year-end 2024 conference call. I'm joined on today's call with Amal Khoury, our Chief Business Officer, and Arvind Uchana, our Chief Financial Officer. I am proud to announce that we have delivered 11 years of consecutive record high revenues since the inception of Knight. In 2024, we delivered revenues of over $365 million and adjusted EBITDA of approximately $58 million. Our growth was driven by our key promoted products, which account for 75% of our total revenues. The promoted portfolio grew by 16% over the prior year period and has delivered a three-year CAGR of more than 30%. While delivering on excellent results, we made significant progress in expanding our pipeline with five new products. We have expanded our neurology portfolio with the licensing of Crexant from Amnil and Journey PM from Collegium for all of our territories. In addition, we have strengthened our partnership with Halcyon with the addition of Onisit for certain LATAM countries. With respect to our branded generic portfolio, we added two branded generic molecules in oncology and hematology for select LATAM countries. To date, we have a pipeline of 18 products, including recent launches, which is expected to generate peak sales of over $150 million. In addition, we further advanced our pipeline with regulatory submissions of Calgary in Canada and Tavalise in Brazil and Argentina. With these submissions, we now have four innovative products, namely Calgary, Tavalise, Minjuvi, and Pemezir, awaiting regulatory approval in multiple territories. In addition, we have five branded generic products pending regulatory approval in multiple countries. We not only executed on regulatory submissions, we also obtained several regulatory approvals, namely Minjuvi and Tavalise in Mexico, and Journey PM in Canada, and Pemezir in both Mexico and Brazil. In addition to the regulatory process, we launched two products in Canada, Bijuva and Invexi. The latter competes in a growing market valued at over $110 million in 2024. Outside of Canada, we launched Minjuvi in Brazil. Moving to our NCIB, during 2024, we purchased approximately 1.6 million common shares for $9 million. In the first quarter of 2025, we purchased approximately 600,000 common shares for $3.3 million. I will now turn the call over to Arvind to provide a financial update on our financial update.

Thank you, Samira. When speaking of our financial results, I will refer to adjusted EBITDA and financial results at constant currency, which are non-IFRS measures, as well as adjusted EBITDA per share, which is a non-IFRS ratio. Knight defines adjusted EBITDA as operating income or loss, excluding amortization and impairment of non-current assets, depreciation, the impact of accounting under hyperinflation, acquisition costs, and non-recovering expenses, but to include costs related to leases. We define adjusted EBITDA per share as adjusted EBITDA over the number of common shares outstanding at the end of the respective period. In addition, revenues and financial results at constant currency are also a non-GAAP measure. Financial results at constant currency are obtained by translating the prior period results at the average foreign exchange rates in effect during the current period, except for Argentina where we only exclude hyperinflation. Furthermore, my discussion on the operating results, we refer to figures that exclude hyperinflation unless otherwise indicated. For the fourth quarter of 2024, we delivered revenues of over $94 million, representing an increase of $6 million, or 6% versus prior year. In 2024, as Samira mentioned, we delivered record high revenues of over $365 million, representing an increase of $22 million, or 6%. On a constant currency basis, revenues increased by approximately $29 million or 9% versus prior year, driven by growth across all of our therapeutic areas. In 2024, our oncology and hematology disease portfolio delivered approximately $137.6 million, a growth of $15 million or 12% compared to last year. This increase was driven by the continued growth of our key promoted brands, which contributed approximately $24 million of incremental revenues, mainly coming from Lendvima, Akinzeo, 12thora, as well as the launch of Minjuvin Brazil. This growth was partially offset by a decline in our mature and branded generic products due to their lifecycle and the market entrance of new competitors, as well as the impact of LATAM currencies depreciation. Our infectious diseases portfolio delivered approximately $149 million, an increase of $8.5 million or 6% compared to the same period last year. The increase was driven by the growth of our key promoted products, including Ambisome and Crescemba, partly offset by a decrease in U.S. demand for Improvido. As a reminder, under our sales contract with the Ministry of Health in Brazil, or MOH, in 2024, we delivered $24.8 million of Ambisome compared to $25.2 million in 2023. In January 2025, we have signed a new contract for Ambisome with the MOH and we expect to deliver approximately $22.4 million in 2025. Turning to our other specialty therapeutic area, the portfolio generated $79 million in revenues, remaining relatively unchanged compared to last year. Now moving on to gross margin. We reported $44.3 million, or a gross margin of 47% of revenues, in the fourth quarter of 2024 compared to $42.4 million or 48% of revenues in the same period last year. For the year ended December 31, 2024, we reported $173 million or a gross margin of 47% of revenues compared to $166 million or 48% of revenues last year. The decrease in gross margin as a percentage of revenues was due to product mix. I will now turn to our operating expenses. Our operating expenses excluding amortization and impairment of non-current assets for the fourth quarter was $31.2 million, remaining relatively unchanged compared to the same period last year. For 2024, our operating expenses excluding amortization and impairment of non-current assets were $119.3 million, an increase of $10.8 million, or 10% compared to last year. The increase in operating expenses was driven by an increase in marketing and medical initiatives behind the launches of Minjuvi, Invexi, Bijuva, and pre-launch activities for GNA-PM in Canada. In addition, our R&D costs increased driven by product development activities in connection with our pipeline, as well as regulatory submission fees. Lastly, our GNA costs increased due to our structure and higher compensation expenses. As a reminder, all costs related to development activities have been expensed, which typically include regulatory submission, analytical method transfers, stability studies, and bioequivalent studies. Moving on to adjusted EBITDA. For the fourth quarter of 2024, we reported $15 million, an increase of $2.9 million, or 24% compared to the same period last year. For 2024, we reported $57.8 million, a decrease of $2 million or 4% compared to last year. Our adjusted EBITDA per share was 58 cents, remaining relatively unchanged compared to 2023. I will now cover our financial assets, which are valued at $134 million at the end of 2024. During the year, we recorded a total net loss of $2.8 million on our financial assets, driven by the revaluations of our strategic fund investment, offset by the change in the value of our synergy shares. In 2024, our synergy shares were revalued at $8.3 million compared to nil in the prior year. With respect to our strategic fund investment, we have recorded a net loss of $11.4 million, driven by mark-to-market adjustments. As a reminder, our funds continue to be a source of cash. In 2024, we collected $14.7 million, including $5.8 million, for certain contingent milestones which were not previously recorded on the balance sheet. Moving on to our cash flows. During 2024, Knight generated cash inflows from operations of $36 million, including a net working capital increase of $20 million. Investment in net working capital was driven by an increase in our accounts receivable, due to both higher revenues and timing of collection, as well as investments in our inventory due to timing of purchases and new product launches. I will now turn the call over to Amal to provide more details on our business development activities.