HLS Therapeutics Inc.

Good morning and welcome to the Q4 and Fiscal 2025 Financial Results Conference Call for HLS Therapeutics. At this time, all lines are in listen-only mode. Following the presentation, we will conduct a question and answer session. If at any time during this call you require immediate assistance, please press star zero for the operator. This call has been recorded on Thursday, March 12, 2026. At this time, I would like to turn the call over to David Mason, Investor Relations, for the introductory remarks.

Thank you, Joelle. Good morning, everyone, and thanks for joining us today. With me on the call is Craig Millian, Chief Executive Officer, John Hanna, Chief Financial Officer, and Brian Walsh, Chief Commercial Officer. Earlier this morning, we issued a news release announcing the financial results for the three and 12 months ended December 31st, 2025. This news release, along with our MD&A and financial statements, is available on our website and on CDAR+. Please note that slides accompanying today's call can be viewed via the webcast, a link to which is available in our earnings release and on our website on the events page. Certain matters discussed in today's conference call or answers that may be given to questions could constitute forward-looking statements. Actual results could differ materially from those anticipated. Risk factors that could affect results are detailed in the company's annual information form, which has been filed on CDAR+. During the call, we will refer to adjusted EBITDA. Adjusted EBITDA does not have any standardized meaning prescribed by IFRS. Adjusted EBITDA is defined in our press release and annual filings that are available on CDAR+, and on our website. Please note that all financial information provided is in U.S. dollars unless otherwise specified. And I would now like to turn the meeting over to Mr. Million. Please go ahead. Thanks, Dave.

Good morning, everyone, and thank you for joining us today. On our call today, I'll review Q4 and 2025 performance highlights, the progress we've made against our priorities for the year and our path going forward. Brian will drill down further on product performance, along with an update on our cardiovascular franchise expansion. John will follow with a detailed look at the numbers. After our prepared remarks, we'll hold a Q&A session. In 2025, HLS made considerable progress against our objectives to drive profitable growth, strengthen our balance sheet, and lay the foundation for future growth by a portfolio expansion. I'll structure my remarks today around three key themes we introduced earlier last year, and then Brian and John will expand upon them. First, driving operating performance within our base business. Second, building a leading Canadian-based cardiovascular franchise with the additions of Nalendo and Nexlozent. And third, the strengthening of our financial foundation, which in turn increases optionality to deploy capital. Let's start with a look at our Q4 and full year business performance. Revenue in the quarter was $15.2 million and $55.5 million for the full year. Excluding the impact of foreign exchange and the drop in royalty revenues, product sales grew 1% for the year. Adjusted EBITDA for the quarter was $5.7 million and $19.6 million for the full year, achieving 18% growth for the full year. Strong growth in adjusted EBITDA reflects our balanced approach to driving product performance while also optimizing spend. Importantly, we're now seeing signs that the changes we made in 2025 with our cardiovascular sales force are working. The SEPA unit demand grew 23% for the year, and importantly, there was a positive inflection in the second half in new-to-brand prescriptions. And for the first time, the SEPA made a positive contribution to adjusted EBITDA for the full year. Greater operating efficiency, along with progress in de-levering our balance sheet, also drove improved cash flow in 2025. Net debt declined 23% in 2025, while cash from operations for the full year was $17.1 million, up 114% compared to 2024. As it relates to our overall operating performance, we executed on our 2025 business plan and met our most recent full-year guidance targets. The second theme I'd like to touch on is the build-out of the HLS cardiovascular franchise in Canada. In May last year, we announced the Canadian in-licensing of Nalemdo, or benpidoic acid, and Nexlozet, a pill that combines benpidoic acid with ezetimibe. In November, we received approval from Health Canada for Nalemdo, while the application for Nexlozet remains in progress. The addition of Nalemdo alongside the CIPA and eventually Nexlozet positions HLS as a leading Canadian-based company focused on cardiovascular risk reduction. These medicines are a strong strategic fit within our portfolio and represent the type of assets we've been targeting through our business development efforts. Nalemdal and Nexlazet are available in countries throughout the world where they already generate hundreds of millions of dollars in global annual sales. Successfully launching these medicines into Canada is mission critical to driving the next phase of growth for HLS. Of note, commercializing these products will not require additional headcount as we leverage our existing sales force and organizational capabilities. From a timing perspective, Nalendo is now commercially available as we made our first wholesaler shipments and booked our first sales just this month. We will have a full commercial launch with our sales force in early April and expect to see a ramp in prescribing uptake at that time. For Nexoset, we are actively engaging with Health Canada to provide the additional information they've requested and are targeting an approval by early 2027. Let me outline why we believe the Nalendo and Nexlovet opportunity may not be fully appreciated and why we're so excited about the potential for this franchise. First, the addressable market. We estimate that roughly half a million Canadians could benefit from treatment with benfidoic acid. These are patients who either cannot tolerate adequate statin doses or who remain above their LDL cholesterol targets despite treatment with statins and ezetimide. Second, the clinical profile. The CLEAR outcomes trial demonstrated compelling cardiovascular risk reduction with Nalemdo. This isn't just an LDL lowering agent. It's a medicine with proven outcomes data that fits squarely within the existing treatment paradigm. Third, the value proposition. At a list price of $4.25 Canadian per day, Nalemdo represents significant value compared to injectable medicines, which cost a multiple of that amount. Combining dempidoc acid with a xenomide and a statin can achieve a magnitude of LDL reduction comparable to PCSK9s at a fraction of the cost and with an all-oral regimen.

Fourth, community economics.

Based on expected net pricing, we anticipate strong margins, and by leveraging our existing cardiovascular infrastructure across multiple products, the overall CV franchise will become more profitable. Within the targeted patient population, which is a small subset of the much larger statin universe, even a conservative market share assumption could potentially translate into annual sales in the range of 50 to 100 million Canadian This represents a substantial growth opportunity that should more than double the size of our cardiovascular business. Brian will speak more to the benefits of our staged approach to launching the Lendo and then Nexoset as we see multiple catalysts unfolding over the next 12 to 24 months that should drive sustained growth. The third thing I want to highlight is our strengthening financial position, which will provide greater flexibility for future growth. We continue to take a balanced approach to capital allocation with the priority of pursuing business development opportunities while also paying down debt and repurchasing our stock. John will talk about the significant progress we've made paying down debt and lowering our interest expense over the past year. Regarding share buyback, the NCIB remains a key component in our capital allocation plan Certain restrictions have limited recent activity, but we continue to see compelling value at current prices and expect to resume buying when able. Now that we have our financial house in good order, we are in a strong position to increase our focus towards expansion and growth. Our base business is stable and profitable, our balance sheet is strong, we have a major new product launch ahead of us, and we have the financial flexibility to pursue additional portfolio expansion. Our disciplined BD approach is to target assets in the US and Canada that may be available at a reasonable cost and that can potentially drive meaningful top-line growth while leveraging our existing infrastructure and capabilities. We also remain open to the possibility of a strategic transaction to more rapidly build scale and create shareholder value. Looking now at our financial guidance for 2026, we expect to deliver revenue of $56 to $60 million, which is mid-single-digit percentage growth, and adjusted EBITDA of $18.5 to $21 million, which is relatively flat to 2025. This guidance reflects some growth from our base business, along with conservative millennial sales expectations, and the investment needed for a successful launch. After making substantial cuts to cardiovascular spend over the past two years, we now plan a modest increase to ensure we don't underinvest in critical launch activities. That said, we fully expect the cardiovascular business overall to increase its positive contribution toward adjusted EBITDA in 2026. However, the real growth story accelerates beyond 2026. With continued CEPA growth, the 2026 launch of Nalendo with expanded public payer access starting in 2027, and then the anticipated launch of Nexlozet in 2027, We expect to see more meaningful revenue and earnings expansion in 2027 and beyond. And this is before we consider any potential upside from our business development efforts. In summary, we've built a foundation over the past two years that now positions us to drive sustained profitable growth in the years ahead. With that, I'll turn it over to Brian to provide more detail on our commercial performance and our expanded cardiovascular portfolio. Brian?

Thanks, Greg, and good morning, everyone. I'll start with an update on ClosRail performance across both markets. In the U.S., 2025 saw the benefits of our specialty pharmacy program initiative, which helped to partially offset patient attrition in other channels. We continue to see strength of this program into Q1 of 2026 with potential to further drive stabilization of ClosRail in the U.S. In Canada, as we discussed on the last call, we faced some pressure in Ontario due to the new GPO arrangements with certain hospital accounts during 2025. While there was increased competitive activity, we successfully retained our largest and most strategic hospital accounts and maintained our position as the leading supplier in Ontario. Looking ahead to 2026, we anticipate some further revenue pressure from those 2025 renegotiations, but we believe these headwinds are manageable and expect the Ontario business to stabilize as we move through this year. Across our other Canadian markets, we're seeing positive developments. We continue to gain share in Western and Atlantic Canada and maintain strong patient retention in Quebec. Importantly, plausible remains the only approved treatment option for treatment-resistant schizophrenia, and we continue to see opportunities to increase utilization with this difficult-to-treat patient population. Turning to the SEPA, we made purposeful changes to strengthen our HLX team during 2025, both at the field leadership and sales representative levels, and we are now seeing the benefits of those changes. Personnel changes did lead to some short-term disruptions in customer engagement and impacted sales territories earlier in 2025, but we have now moved past those disruptions and saw strong performance in key metrics in Q4. On the demand side, unit growth for the quarter was 19% and for the full year was 23%. Reflecting the positive changes to our sales force, we saw growth inflection in new patient starts not observed since prior to the Pfizer separation. Of note, the delta between the SEPA unit growth and revenue growth in Q4 is primarily a function of payer mix and the timing of shipments for year-end orders. With all the changes we've made over the past year, our focus has been on driving profitable growth. We are improving the profitability of the product, and for the full year 2025, the SEPA made a positive contribution to adjusted EBITDA. As a result of our improved copay assistance program and our increased focus on the private payer segment, We're also seeing stabilization in our payer mix in Ontario and Quebec, which is also helping to improve overall profitability for the brand. Now let me turn to our exciting Nalemdo opportunity, which represents a transformational addition to our cardiovascular portfolio. Nalemdo fills a gap between generic statins and ezetimibe and more costly injectable PCSK9s. This positioning is particularly favorable in Canada, where patient access to PCS canines is highly restricted. As Craig shared, we will launch Nalemdo at a list cost of $4.25 Canadian per day, which creates an opening in a very clearly defined patient population for Nalemdo as an oral, well-tolerated, and cost-effective treatment. We conducted blinded market research in late Q4 with targeted Canadian cardiologists and endocrinologists. The results showed very high levels of aided and unaided brand awareness, which demonstrated that most of our targets are already familiar with Nalendo. Importantly, the survey also showed strong intent to prescribe for patients not at goal on a statin or intolerant to statins. We also held an in-person national advisory board of top specialists from across Canada earlier this year. This provided our teams with valuable feedback as we finalized our launch plans, but also reinforced for us that specialists across Canada see significant unmet need and are eager to add Nalemdo to their armamentarium. Nalemdo is now available at wholesalers and we are on track to begin promoting it with our sales force in early April. Since our last call, We've submitted our reimbursement dossiers to CDA, formerly known as CADF, as well as to private payers. We expect meaningful private payer coverage to be achieved over the next several months. Public sector discussions will continue throughout 2026, targeting provincial listings by early 2027. For Nexoset, as Craig said, we are working towards securing approval and launching in the first half of 2027. The stage launch of Nalemdo, followed by Nexazet, works in our favor for several reasons. One, clinicians know benpanoic acid from the CLEAR trial as a single agent. So launching Nalemdo first builds the brand foundation. Second, most will prescribe Nalemdo as an add-on therapy initially. Clinicians typically want experience with a novel molecular entity before they consider a combination pill. Third, this approach also gives us multiple catalysts. April 2026 Nalemdo launch, followed by provincial listings in 2027, and Nexilzet approval and commercial launch in the first half of 2027. Finally, from a reimbursement perspective, since Nexilzet is essentially Nalemdo plus generic ezetimibe, we can likely converge the timelines rather than run separate reimbursement processes. In closing, with Nalemdo, Nexoset, and Vasipa, we'll lead cardiovascular risk reduction in Canada with an all-oral portfolio. With that, I'll turn it over to John for a detailed look at our financial performance. John?

Thank you, Brian, and good morning, everyone. In my section, I'll focus on Q4 and full-year results and the progress made to strengthen our balance sheet and improve capital allocation flexibility. Starting with revenue, total revenue for Q4 was $15.2 million compared to $15.5 million last year. For the full year, total revenue was $55.5 million compared to $56.6 million in 2024. Canadian product sales of Vesipa and Clozaril in Q4 were $16.2 million, and for the full year were $59.2 million in local currency. This represented a 1.5% increase for the full year. U.S. clausural sales in Q4 were 3.3 million, and for the full year were 12.4 million. This represents a 1.6% decrease for the full year, which is a considerable improvement over the four-year average annual decline of 6%, and reflects the efforts to mitigate attrition that Brian described earlier. Finally, royalty revenue was $0.7 million for the full year compared to $1.5 million in 2024. On the expense side, we continue to show progress reducing our cost base, helping to drive strong margin and cash flow performance. Q4 operating expenses comprising sales and marketing, medical, regulatory, and patient support, and G&A were $6.8 million, down 6% compared to Q4 last year. For the full year, operating expenses were 25.8 million, down 17% compared to 2024. This demonstrates the positive impact of the operational efficiency efforts we made in 2024 and continued through 2025. Cost of sales in Q4 was 2.6 million, and for the full year was 10.1 million, with the full-year increase largely due to demand growth in the SEPA. Q4 adjusted EBITDA was $5.7 million, up 3% compared to Q4 last year. For the full year, adjusted EBITDA increased 18% to $19.6 million. Excluding royalty revenue, the full-year increase would have been 24%. For Q4, the direct brand contribution of Clauseril to adjusted EBITDA was $7.7 million, while the direct brand contribution from Vasipa to adjusted EBITDA was $0.3 million. For the full year, the contributions for Clauseril and Vasipa were $26.9 million and $1 million, respectively. Of note, in 2024, Vasipa's direct brand contribution to adjusted EBITDA was a loss of $3.6 million, highlighting the successful financial turnaround of this asset. Cash from operations in Q4 was $6.5 million, up 103% compared to Q4, 2024. For the full year, cash from operations was $17.1 million, up 114% versus 2024. Cash from operations has increased due to the factors I've described and has also benefited from lower interest expense, which was down $3.8 million, or 43%, compared to 2024. A big part of the story of our transformation over the past two years is the growth in adjusted EBITDA ex royalties and improved cash flows. On a trailing 12-month basis, you can see on this slide that after bottoming out in late 2023, early 2024 timeframe, we've seen consistent quarterly improvements in adjusted EBITDA ex royalties. Our focus on operational improvements has restored our profitability trajectory and generated the strong cash flows that are enabling our balanced capital allocation approach today. One final comment on adjusted EBITDA. You can see on this slide that there tends to be seasonal quarterly variation. We expect a similar pattern in 2026, though the timing may be more pronounced given the LEMDO launch dynamics. We'll be investing in the first half of the year with revenue beginning to ramp in Q2 and accelerating through the second half of 2026. Our balance approach for capital allocation allows us to accomplish multiple objectives. First is to continue to deliver the balance sheet by paying down debt. During 2025, we made principal repayments totaling $17.8 million. At December 31, 2025, the principal balance of our term loan stood at $50 million, down 26% from $67.4 million at the end of 2024. As a result of our continued delivering, net debt stood at $38.3 million at year end, down 23% from the end of 2024, and down 50% from $75.6 million three years ago. Second is the return of capital shareholders via share buybacks. During 2025, we purchased approximately 519,000 shares at a cost of $1.8 million. And thirdly, deploying capital to expand our portfolio. With Nalemdo and NexLisette, we made an upfront payment of $1 million upon signing the agreement and will ultimately pay an additional $1 million upon Health Canada approval of NexLisette. The agreement also includes customary royalties on future sales and potential milestone payments tied to pricing and reimbursement and the achievement of significant commercial sales targets. And as Craig mentioned, we'll be investing here in 2026 to ensure the successful launch of Nalemdo, a key long-term growth driver for the business. Looking at the balance sheet, cash was $11.7 million at year end, compared to $17.5 million at the end of 2024, with the change reflecting the debt payments and strategic investments made during the year, offset by growth in cash from operations. As we look ahead to 2026 and beyond, we'll continue this balanced approach to capital allocation though with an increased emphasis on growth investments. Our strengthened balance sheet and improved cash flow profile give us the flexibility to pursue multiple objectives simultaneously. And with that, I'll pass it back to Craig for his closing comments.

Thanks, John.

In summary, our results for 2025 reflect progress against our key priorities. We're driving performance in our base business, maintaining strong margins, and generating cash. We're positioned for our next stage of growth as we actively prepare to expand the HLS Canadian cardiovascular franchise with the 2026 launch of Nalendo and an expected 2027 launch of Nexlozet. And our strengthened balance sheet will provide increased flexibility to pursue additional value-creating opportunities. As we enter 2026, we're leveraging our foundation of increased efficiency and profitability to advance towards our next stage of growth. We're well positioned to deliver value for our shareholders as we expand our cardiovascular franchise and build HLS into a larger, more diversified specialty pharmaceutical company. That concludes my prepared remarks. And at this point, I'll ask our operator to please provide instructions for asking questions.

Thank you. Ladies and gentlemen, we will now begin the question and answer session. Should you have a question, please press star followed by the one on your touchtone phone. You will hear a prompt that your hand has been raised. Should you wish to decline from the polling process, please press star followed by the two. If you are using a speakerphone, please lift the handset before pressing any key. One moment, please, for your first question. Your first question comes from Michael Freeman with Raymond James. Your line is now open.

Good morning, Craig, Brian, John. Congratulations on a strong year, on the launch of Nalemdo, and particularly the cost optimization initiatives you've undertaken this year. I wonder if you could go a little bit further into your launch strategy for Nalemdo's first year, principally serving the private payer market. Describe how, I guess, what you will invest in activities you'll pursue this year.

Great. Thanks, Michael. And I think we'll ask Brian maybe to address that one.

Sure. Thanks, Michael, for the question. So as I shared, we're launching into a strong context given that Nalumda has been available in other markets for a number of years. There's already strong awareness and anticipation from Canadian physicians. So we're excited to make the product available just last week and launch meeting in early April. Our efforts over the last nine months since being licensed have been heavily focused on the market access preparations. So we've had Very substantive engagements with private payers, and we expect to have more news on those in the coming months, but very receptive to the strong value proposition that Nalendo presents, as I described, relative to other costly options in the category. Our efforts, our primary, our biggest investment is in our sales force, a very tenured team, very passionate about cardiovascular risk reduction. And our efforts will be balanced in terms of driving awareness and adoption of Nalemdo, but also leveraging that as a tailwind for the SEPA as we, you know, we're engaging in an even broader conversation about cardiovascular risk reduction. We temper expectations in year one in Canadian launches because we are launching with just the private coverage, which we'll be rolling on throughout the year. So a significant background effort is engaging with CDA. We've submitted those reimbursement dossiers and we expect mid-year to have an opinion from that organization, which will flow into provincial negotiations later this year. You know, hopefully initial provincial listings late this year, early next year, at which point you would really start to see a ramp as products more broadly reimbursed. And that will, as I mentioned in my remarks, time nicely with the introduction of next, based on our plan. So that's kind of our plans in a nutshell. Anything to add, Greg?

Yeah, no, I think that sums it up. I guess I just want to highlight a couple of points that Brian mentioned during his earlier comments that I think really excite us. So one is we did this awareness and usage study, baseline study, ahead of launch just to get an understanding of, you know, what the levels of awareness and interest were in benfidoic acid. So we surveyed a fairly sizable number of cardiologists and endocrinologists, and it was pretty remarkable in terms of the very high level of awareness, in particular unaided awareness, of this medicine and the interest in potentially prescribing it. Usually, it takes quite a bit of time to generate those levels of awareness post-launch. And because this product has been available in the US and in Europe and has had really important data presented at major medical meetings, published in the New England Journal, the level of recognition is quite high. And I would add the level of anticipation is quite high. know advisory boards and and thought leaders who have emphasized um how excited they are that this is going to be made available to them in canada so um so of course we have to do the the work of getting as brian said and making sure we get the access and reimbursement we've got our sales reps coming together and our medical people in the next few weeks for training and preparation, but I think we're excited to get the ground running based on this very high baseline level of awareness and interest. Perfect.

I appreciate all of that detail. A follow-up question I have is, on your 2026 outlook, thank you for providing some guidance. The top line numbers fell slightly below consensus, and I appreciate you providing some assumptions in the press release and in your prepared remarks today, but I wonder if you could just say more about how you're thinking about the growth in the base business and other factors that might impact top line specifically.

Yeah, sure. I think, you know, we're very intentionally, I think, assuming conservative estimates for year one for Nalendo, which we think, you know, we hope to outperform. But, you know, we assume something on the order of a million plus in revenues for Nalendo this year. And we expect that to accelerate greatly towards the latter part of the year, especially as we get public access And then obviously, we double that portfolio next year with the launch of Nexoset, so we see significant growth. for the Pembodoc acid franchise as we move to 2027. The SEPA, we expect to continue to grow. We're expecting growth in the teams this year. And we're being conservative in our estimates for Closeral. We're assuming flat to maybe a slight low single-digit percentage decline in Closeral sales this year. based on what we had described that occurred really in the middle of last year around some of this increased competitive activity in Ontario, which did have some impact in our business there. We expect that will primarily impact the early part of this year on a year-over-year comparison basis because, again, The impact was primarily in the back half of last year. I think as we get through the first half of this year, we expect that business will stabilize and then largely be offset by gains in other provinces where we continue to see strong growth, for example, in market share and patient volumes out west. We're very encouraged by that, as well as some of the Atlantic provinces. So I think you put all that together. Again, we wanted to be reasonably conservative this year, but that's how we come up with that range.

Okay. All right. Thank you very much. I'm going to pass it on.

Your next question comes from Max Milski with Stiefel.

Your line is now open.

Good morning, guys. I'm on for Justin this morning. Thanks for taking my question. I guess, firstly, to maybe get a little bit more granularity from a previous question, Can you outline the cadence of incremental launch spend for Nalemdo through 2026, and what might the split be between promotional and, you know, other medical and patient support costs?

Yeah. So, Max, thanks for the question. Brian or John, John, maybe you want to take that one?

Yeah, sure. Max, the way I would be sort of thinking about it in rough terms is for the year we'll get some nominal growth on the revenue line that in sort of large-scale terms will drop a couple million dollars in additional gross profit. That will be deployed in about the same amount in OPEX increase split primarily between selling and marketing and medical and regulatory. Not quite 50-50 split, I would say, 55% sales and marketing, 45% medical regulatory would be the uptake of that additional spend. Most of it front-end loaded in Q1, Q2, starts getting back to normal levels of OPEX by the fourth quarter.

Yeah, so as John mentioned, we're a little front loaded in terms of preparing for lunch. A lot of the spend to date has been on access and reimbursement related activities. So I'm sure we had a really strong dossier to submit to the CDA. And of course, now we're preparing our sales force with training and promotional material, as well as a number of KOL engagement activities, the opinion leader engagement activities, advisory boards, both at a national and regional level that are really being driven out of our medical team. So I'd say in aggregate, you know, we're not increasing our footprint, but in aggregate, probably something on the order of about $2 million incremental to support the Milendo launch.

Perfect. Thank you. And maybe a cash flow question. In fact, to John, can you provide any additional detail on the $7 million in milestone payments on Millimbo and XLSN and when these might be triggered? Is this based on maybe respective CDA outcomes? What is the visibility on that?

Yeah, I'll let Brian talk about the specifics on pricing and reimbursement, but I would say the $1 million for the Health Canada approval, I would say timing is 2026, likely towards the end of the year based on where we're moving towards, and then remaining milestones of the $7 million would start in probably Q2 2027 and onward. And maybe Brian can add color on the specifics of those.

Yeah, at a high level, they're tied to pricing outcomes of both that list price and a negotiated PCTA price. So we'll go into too much specifics, but there are levels that would support a very strong case for LMDA moving forward.

So The better the pricing we get, there's a sliding scale in terms of the payment that that would trigger. So that would be a good problem for us to have, to have a higher payment. That would suggest that we negotiated very favorable pricing. And so just another way that we structure the deal, our approach is to find assets that are largely de-risked from a clinical regulatory perspective, and then also try to stage-gate it in a way that we can de-risk some of the key commercial risk factors like access and reimbursement. So that's how we structured it.

Great. And maybe one more question. It's a bit of a tangential, but you mentioned an inclination to pursue maybe strategic acquisitions beyond just maybe in licensing. And based on the pipeline, as you see it, is there a point where it makes sense to use stock as currency and getting a deal done without straining the balance sheet too heavily?

Yeah, that would not, and I'll also maybe let John comment on this. I don't think certainly these prices, that would not be our preference. I think we'd build a stock that's quite undervalued. And so I think we would look for other mechanisms. And again, I think, you know, we want to be opportunistic. So I think depending on obviously the the quality of the opportunity and the value creation opportunity that it would present, you know, we would figure out the best way to deploy the capital, but I don't think that would be our first, that certainly wouldn't be our first instinct. John, anything to add?

No, I would, I would agree. You know, there, there could be something small beyond an in-licensing, but I don't think it would be at this point considering that as a, funded through equity, you know, a little further down the road. Certainly, we'd be entertaining those, but I would like to see the share price higher before we start using it as a currency.

That's great. Thanks so much, guys. Thanks, Max.

Ladies and gentlemen, as a reminder, should you have a question, please press star 1. Your next question comes from David Martin with Bloomberg. Your line is now open.

Good morning. I think you're anticipating that Nalemdo reimbursement will be substantially less restrictive than the PCSK-9s. What gives you confidence in that regard, and has there been anything concrete so far with the private payers giving you listings that support that expectation?

Hi, David. Good morning. This is Brian. Thanks for the question. We're active in those discussions now, which gives us confidence. Nothing to announce just yet, but I think we're seeing that the value proposition is well received. And there's also an acknowledgement at these price levels that putting a lot of restrictions in place would be very onerous. for the patient, for the physician, for the insurance company themselves. So more to come, but I think we'll... The other thing is in these discussions, companies are looking to use technology more and more, and we're trying to lead on that discussion. So ways to ensure through auto-adjudication that patients have been on statin at some point in the past versus having to do more onerous paperwork and physician signatures. So I think we'll be on the... cutting edge of those discussions, hopefully, in terms of more efficient ways for reimbursement adjudication. But I think importantly, to the cost delta per patient per year that we've talked about in the past, relative to the ability to get very high levels of LDL reduction with the Lemdo pluses out of my plus statin, we're not seeing Quite the opposite. In fact, we're not seeing a desire for payers to put restrictions, private payers to put restrictions in place.

Yeah, this is a really... Yeah, I'm just going to add, you know, to distinguish between, you know, the experience with the CIPA, this is a very different type of market where it's very well understood in terms of the importance of getting patients to their LDL targets. And so, you know, this fits squarely within the paradigm of the patient population we've defined and the value of, you know, that line of therapy before either, you know, the patient's failing treatment altogether, not getting to their targets, which is really unacceptable, or really being forced to go on a more costly injectable. And so really everybody understands, you know, that those are kind of the choices. And so I think they're far more receptive and welcoming, quite frankly, in terms of where Nalemdo can fit into that paradigm.

Okay, thanks. Other countries have lowered cholesterol targets. Do you know if the same is expected in Canada? And I assume that would be good for the Nalemdo launch.

Yes, specifically European countries have lowered to 1.4. Canada is still at 1.8. I mentioned my remarks had a national advisory board and that was a topic of discussion. I think Canadian opinion leaders are thinking in that path of wanting to get to lower levels. We don't expect the guidelines to be updated in the next 12 to 24 months, which could reflect that. But certainly a tailwind for, you know, tailwind. We haven't baked that into our, you know, as we reflect kind of patient opportunity, we look at patients that are not at current goals. So that is, you know, an opportunity moving forward that potentially more patients would become eligible.

And speaking of the opportunity, you mentioned 50 to 100 million in peak sales. Is that range dependent on whether Nexlozec gets approval?

So, you know, again, this is based on, I would say, fairly conservative share assumptions. I think our expectation, frankly, is that next was that we'll get approval, you know, without going into great detail. The types of questions that were raised by Health Canada were not of great significance in terms of, you know, requiring significant new data generation, for example. There's no question around the clinical profile of safety and efficacy data. They were really more technical matters. And so, you know, we're assigning a very high probability that we'll be able to work through this in the next few months. So we don't really see the prospect of Nexildet not getting approval as a realistic outcome. It's been approved in every other market with the same data package. And again, based on the questions raised, none of them are really of great concern in terms of our ability to address them. It's really a matter of when, not if. As Brian said, you know, we actually think that the staging works in our favor because it is a novel mechanism and physicians are going to want to get some experience with the novel mechanism before removing, you know, other treatments in a combo pill. So we actually think from a life cycle management perspective, this is quite ideal to launch with a familiarize everybody with Pempadoc acid and all the data and the mechanism of action. And then you'll be able to follow that up. Again, our best estimate is early 2027 with a combo pill, which will create obviously much greater convenience for patients. So I think it's a good question, Dave, but I don't think it's one that really is germane this will launch in 2027.

Okay, thanks. And I have one more quick question. You mentioned factors that curtailed the NCIB. I'm just wondering what those were.

John, do you want to speak to that?

Yeah, just, you know, at times we're in blackout periods and prevented from purchasing shares. And then there will be times during the year where we're more or less active just depending on market conditions and our priorities in capital allocation.

Okay. Thanks. That's it for me. Thanks, Dave.

If there are no further questions at this time, I will now turn the call over to Craig Milligan for closing remarks.

All right. Thank you, Joelle, and thank you all for participating on today's call. We look forward to reporting to you on our progress in the coming quarters and speaking with you all again soon. Thanks. Goodbye.

Ladies and gentlemen, this concludes the conference call for today. We thank you for participating and ask that you please disconnect your lines.