Aquestive Therapeutics Q3 2026 Earnings Call Transcript

Aquestive Therapeutics (NASDAQ:AQST) reported third-quarter financial results on Wednesday. The transcript from the company’s third-quarter earnings call has been provided below.

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Summary

Aquestive Therapeutics reported a decrease in total revenue to $7.6 million for Q3 2026, down from $12.8 million in Q3 2025, primarily due to fluctuations in Suboxone product orders.

The company has successfully resubmitted its Anaphylm epinephrine sublingual film application to the FDA and expects a decision by March 16, 2027. They are preparing for a U.S. launch and potential filings in Canada and Europe.

Aquestive completed the out-licensing of Libervant to Eton Pharmaceuticals, receiving a $10 million upfront payment and potential milestone payments, while maintaining manufacturing responsibilities.

Operating expenses decreased, with R&D expenses at $4.3 million in Q3 2026 and SG&A expenses at $14.2 million, reflecting lower legal and commercial spending.

The company ended Q3 2026 with $90.3 million in cash and expects to finish the year with more than $70 million, with potential access to $95 million in additional funding contingent upon Anaphylm’s approval.

Management emphasized the strategic focus on Anaphylm’s market launch, highlighting its potential to transition the market from auto-injectors to sublingual film due to its efficacy and ease of use.

Future guidance remains unchanged, with expected total revenue for 2026 between $46 million and $50 million and a non-GAAP adjusted EBITDA loss of $35 million to $30 million.

Full Transcript

OPERATOR

At this time, all participants are in a listen-only mode. After the speaker’s presentation, there will be a question-and-answer session. To ask a question during the session, you’ll need to press star 11 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 11 again. Please be advised that today’s conference is being recorded. I would now like to hand the conference over to your first speaker today, Faith Pomeroy Ward from Aquestive Therapeutics. Please go ahead.

Faith Pomeroy Ward

Thank you, operator. Good morning and welcome to today’s call. On today’s call, I’m joined by Dan Barber, President and Chief Executive Officer, and Ernie Toth, Chief Financial Officer, who are going to provide an overview of the Company’s reported financial results for the third quarter ended September 30, 2026 and a business update on recent developments, followed by a Q&A session. During the Q&A session, the team will be joined by Dr. Matt Greenhot, Chief Medical Officer; Melina Chaffee, Senior Vice President, Regulatory Affairs; Sherry Korchinski, Chief Commercial Officer; and Dr. Matthew Davis, Chief Development Officer.

As a reminder, the Company’s remarks today correspond with the earnings release that was issued after market close yesterday. In addition, a recording of today’s call and related supplemental materials will be made available on Aquestive Therapeutics’ website within the Investors section shortly following the conclusion of this call. To remind you, the Aquestive Therapeutics team will be discussing some non-GAAP financial measures this morning as part of its review of third quarter 2026 results. A description of these measures, along with a reconciliation to GAAP, can be found in the earnings release issued yesterday, which is posted on the Investors section of Aquestive Therapeutics’ website.

During the call, the Company will be making forward-looking statements. We remind you of the Company’s safe harbor language as outlined in yesterday’s earnings release, as well as the risks and uncertainties affecting the Company as described in the Risk Factors section and in other sections included in the Company’s Annual Report on Form 10-K filed with the U.S. Securities and Exchange Commission on March 4, 2026 and in its subsequent quarterly reports on Form 10-Q and current reports on Form 8-K. As with any pharmaceutical company with product candidates under development and products being commercialized, there are significant risks and uncertainties with respect to the Company’s business and the development, regulatory approval, and commercialization of its products and other matters related to operations. Given these uncertainties, you should not place undue reliance on these forward-looking statements, which speak only as of the date made.

Actual results may differ materially from these statements. All forward-looking statements attributable to Aquestive Therapeutics or any person acting on its behalf are expressly qualified in their entirety by this cautionary statement and the cautionary statements contained in the earnings release issued yesterday. The Company assumes no obligation to update its forward-looking statements or outlook or guidance after the date of this conference call, whether as a result of new information, future events, or otherwise, except as required under applicable law.

Now I would like to turn the call over to Dan.

Daniel Barber (Chief Executive Officer)

Good morning and thank you for joining us today. This morning I am pleased to tell you that we continue to execute right on schedule. In March I told you that we would resubmit our Anaphylm epinephrine sublingual film application before the end of the third quarter and we did. I also told you that we would out-license Libervant diazepam buccal film rather than launch it ourselves and we did. I told you that we would refinance our debt before principal payments became due in June and we did.

I told you we expected to have $70 million or more of cash and cash equivalents at year end and I’m pleased to tell you that we now expect to end the year with more than $70 million in cash and cash equivalents. In fact, as we sit here today, we are right where we expected to be. Our lead asset, Anaphylm, is under review with the FDA and has an assigned goal date that is only 132 days away. Or, if you are an investor, since this is our earnings call, only 88 trading days. We are now focused on the next set of deliverables in our execution story. Our organization is ramping up for the U.S. launch of Anaphylm following FDA approval and we are now hiring our district sales managers.

We expect to file Anaphylm in Canada before the end of the year and we are on track to file in Europe in the first quarter of next year. Our ex-U.S. licensing activities also continue and we expect to have more to say in the months to come. Now let’s talk more about Anaphylm in the U.S. Everywhere I go and everyone I talk to in the allergy community can align behind one important concept: when a person is having a severe allergic reaction, the only thing they care about is making it stop as fast as possible. That’s it, and that’s where we believe Anaphylm will shine if approved by the FDA. Stopping a severe allergic reaction is a function of many things, including having a rescue product with you, using the rescue product without hesitation, and having your symptoms abate quickly.

That is why we believe speed is the ultimate differentiator, and we will continue to focus on this as we interact with the allergy community. Our presentations at the upcoming American College of Asthma, Allergy and Immunology in Phoenix this month will highlight these views. This is also why I continue to see the opportunity for Anaphylm as significant. I continue to believe the market will transition from auto injectors to new and improved technologies like Anaphylm.

The market remains large and growing. We expect the overall U.S. market for epinephrine products, measured by total prescriptions, to once again grow year over year in 2027, and we see plenty of opportunity for continued market growth in the years to come. From a development standpoint, we are answering the FDA’s information requests as we receive them and will continue to do so. At this time, we have nothing new to report on the review in terms of timing. While the FDA has assigned a six-month review period, we remain prepared and hopeful for the possibility of an earlier decision. However, we do not control the FDA’s timelines or how they prioritize their workload. Therefore, we are keeping our expectations on receiving its decision by March 16, 2027.

In terms of expectations, we recognize that our story in 2027 will be one of execution as we look towards a spring launch of Anaphylm, if approved by the FDA. I’d like to outline for you how we will judge success in 2027. In other words, what are the green shoots to look for in 2027? First, we are determined to show ongoing progress with payers via both percentage of covered lives and quality of coverage. We will update you as these happen. We have engaged in the preapproval information exchange, or PIE, discussions with the top four PBMs in the country, along with many downstream plans, and we’ll continue to advance productive dialogue as much as possible prior to approval. Second, we want to see uptake in the places where we show up post launch. We will provide you with a view of our progress among the physicians our sales reps are calling on. This is a place we must show progress.

Third, we will track the efficiency of our spending. How many dollars are we spending versus the uptake we see? This will be an important measure as we look to scale our launch quarter by quarter. Now let’s briefly talk about Libervant. We are excited to have out-licensed Libervant diazepam buccal film to Eton Pharmaceuticals. We have waited a long time for Libervant to be available to patients and we expect this to finally come to fruition in 2027, if approved. We believe Eton is the right commercial team to launch Libervant and we look forward to working with them in 2027 and beyond. While Libervant is not central to our growth story, it is an important product for patients and can also be an important cash contributor to the company.

Now let’s turn to the pipeline. Long term, our goal is to become the leading provider of cutting-edge medications for patients who need to control their immune responses. We intend to do this through not only becoming a full-fledged commercial organization with deep expertise in allergy, dermatology, and pulmonology, but also through building a new pipeline of development assets. We see 2027 as a pivotal year for our Adreniverse pipeline. In 2027 we would like to provide meaningful clinical data on AQSD108 for atopic dermatitis as well as bring additional Adreniverse-driven indications through proof of concept utilizing our library of epinephrine prodrugs. Now that our development team has resubmitted the Anaphylm application in the U.S., we expect to focus more energy on these efforts.

So if you look at where we’re going, there’s a lot to be excited about. We are only a few months away from our FDA goal date for Anaphylm. We are expanding into ex-U.S. territories. We have managed our cash tightly and remain on track to fund Anaphylm’s launch, if approved, and we will have more focus on our pipeline as we move into 2027. With that, I will turn the call over to Ernie.

Ernie Toth (Senior Vice President and Chief Financial Officer)

Thank you, Dan, and good morning everyone. By now you will have seen our third quarter 2026 financial results in the earnings release issued last evening and detailed in our Form 10-Q. As we typically do, we will address most of the detailed discussion during our Q&A. I will focus my remarks on our financial performance, operating expenses, and the disciplined capital allocation that supports our next phase of execution. As Dan outlined, we continue to execute against the commitments we made at the beginning of the year. We resubmitted the Anaphylm application before the end of the third quarter. We completed the Libervant licensing transaction. We refinanced our debt in May before scheduled principal payments under the prior notes would have begun and, through disciplined management of our spending and liquidity, we now expect to end 2026 with more than $70 million in cash and cash equivalents.

We believe our existing liquidity, together with potential access to additional capital under the RTW and Oaktree agreements if Anaphylm is approved and other applicable conditions are satisfied, positions us to support launch readiness and initial commercialization activities for Anaphylm, if approved, while continuing to advance our broader pipeline. Before turning to the quarter, I want to briefly highlight the financial aspects of our recently announced Libervant transaction with Eton Pharmaceuticals. Under the agreement, Eton received exclusive U.S. rights to commercialize Libervant, subject to applicable regulatory approvals. We received a $10 million upfront payment and are eligible to receive up to an additional $47.5 million in contingent regulatory and commercial milestone payments. We will also receive a mid-teens royalty on annual U.S. net sales of Libervant.

Importantly, Aquestive Therapeutics will remain the exclusive manufacturer and supplier of Libervant to Eton under a long-term supply agreement. So in addition to the upfront payment, potential milestones, and royalties, the transaction preserves an ongoing manufacturing relationship around the product. We believe this is a capital-efficient structure for Aquestive Therapeutics. It places responsibility for U.S. commercialization with Eton while allowing us to participate in the product’s future value and remain focused on our primary commercial priority: the potential launch of Anaphylm.

Now let me begin with revenue. Total revenue was $7.6 million in the third quarter of 2026 compared with $12.8 million in the third quarter of 2025. This decrease was primarily driven by the quarterly fluctuation of Suboxone product orders. Manufacturer and supplier revenue was $6.7 million in the third quarter compared with $11.5 million in the prior-year period. This primarily reflects lower Suboxone revenue, partially offset by higher on deep revenue.

License and royalty revenue was $0.8 million in the third quarter compared to $1.0 million in the third quarter of 2025, primarily reflecting lower royalty revenue received during the period. Co-development and research fees were approximately $0.1 million compared with approximately $0.3 million in the prior period. For the first nine months of 2026, total revenue increased 14% to $35.8 million compared with $31.5 million for the same period in 2025. This increase was primarily driven by higher license and royalty revenue, including $5 million of Zebra related royalty revenue, partially offset by lower manufacturer and supply revenue and lower co-development and research fees. Manufacturer and supplier revenue for the first nine months was $27.4 million compared with $28.2 million in the prior-year period.

License and royalty revenue increased to $7.5 million from $2.7 million, primarily due to royalty revenue from Zebra. Turning to operating expenses, our results reflect the deliberate choices we have made as we prepare for a potential Anaphylm launch while continuing to manage our overall spending carefully. Research and development expenses were $4.3 million in the third quarter compared with $4.5 million in the third quarter of 2025. This decrease primarily reflects lower share-based compensation, partially offset by higher clinical trial costs associated with the human factors validation study and the pharmacokinetic study completed for the Anaphylm NDA resubmission.

For the first nine months of 2026, research and development expenses decreased to $12.4 million from $14.0 million in the prior-year period. This decrease primarily reflects lower product research expenses associated with the Anaphylm program and lower share-based compensation, partially offset by higher personnel costs. Selling, general and administrative expenses were $14.2 million in the third quarter compared with $15.3 million in the prior-year period. The year-over-year decrease primarily reflects approximately $1.5 million of lower legal fees, approximately $1.4 million of lower commercial spending and approximately $0.6 million of lower Anaphylm-related regulatory expenses. These decreases were partially offset by higher personnel costs, share-based compensation, and consulting and outside services expenses.

For the first nine months of 2026, selling, general and administrative expenses decreased to $39.2 million from $47.0 million in the first nine months of 2025. The decrease primarily reflects approximately $6.1 million of lower commercial spending, the absence of the $4.3 million one-time Anaphylm PDUFA fee incurred in the prior-year period, approximately $2.8 million of lower legal fees, approximately $1.5 million of lower regulatory and licensing fees related to Libervant, and approximately $1.0 million of lower Anaphylm-related regulatory expenses.

These decreases were partially offset by higher personnel costs, severance costs, share-based compensation, and consulting and outside services expenses. Turning to the bottom line, our net loss for the third quarter of 2026 was $16.5 million, or $0.13 per basic and diluted share. This compares with a net loss of $15.4 million, or $0.14 per basic and diluted share, in the third quarter of 2025. For the first nine months of 2026, our net loss was $47.4 million, or $0.38 per basic and diluted share, compared with a net loss of $51.9 million, or $0.51 per basic and diluted share, for the same period in 2025.

Just a reminder, the 2026 year-to-date results include a one-time loss on the extinguishment of debt of $11.7 million related to the repayment of our 13.5% notes. Excluding that one-time item, our net loss for the first nine months of 2026 was $35.7 million. Non-GAAP adjusted EBITDA loss was $12.2 million in the third quarter of 2026 compared with a non-GAAP adjusted EBITDA loss of $8.6 million in the third quarter of 2025. For the first nine months of 2026, non-GAAP adjusted EBITDA loss narrowed to $19.2 million compared with a non-GAAP adjusted EBITDA loss of $35.5 million in the prior-year period. Please refer to the reconciliation of net loss to non-GAAP adjusted EBITDA loss included in our earnings release.

Let me finish with liquidity and capital allocation. We had $90.3 million in cash and cash equivalents at September 30, 2026. This amount does not include the $10 million upfront license fee received from Eton in October in connection with the Libervant transaction. As Dan noted, we have managed our cash tightly and expect to finish 2026 with more than $70 million in cash and cash equivalents. This expectation includes the $10 million Eton upfront license fee received in October and does not assume receipt of the contingent RTW or Oaktree funding.

If Anaphylm receives FDA approval by the applicable deadline and we satisfy the other conditions under the relevant agreements, we expect to have access to $75 million under the RTW strategic funding agreement and an additional $20 million under the Oaktree term loan facility. Together with our existing liquidity, we believe these sources would support launch preparation and initial commercialization activities for Anaphylm, if approved, while allowing selective investment in our development pipeline.

We are maintaining our full-year 2026 financial guidance. For 2026, the company continues to expect total revenue of $46 million to $50 million and non-GAAP adjusted EBITDA loss of $35 million to $30 million. Looking ahead, our capital allocation priorities are clear. First, we will fund the activities necessary to maintain launch readiness and prepare for the potential U.S. commercialization of Anaphylm, if approved. Second, we will continue to support the medical, regulatory, market access, and payer work needed to prepare for commercialization following potential approval and to advance our regulatory strategy outside the United States. Third, we will invest selectively in the Adreniverse pipeline with an emphasis on the programs that we believe have the potential to generate meaningful clinical data and create long-term value.

And finally, we will continue to manage our liquidity and capital carefully as we advance these priorities. With that, I will now turn the call back to the operator to open the line for questions.

OPERATOR

Thank you. At this time, we will conduct the question-and-answer session. As a reminder, to ask a question, you will need to press star 11 on your telephone and wait for your name to be announced. To withdraw your question, please press star 11 again. Please stand by while we compile the Q&A roster. Our first question comes from the line of Roanna Ruiz of Lyric Partners. Your line is now open.

Roanna Ruiz (Analyst at Lyric Partners)

Hey everyone. Good morning. So a couple for me. First is, with the upcoming PDUFA for Anaphylm, could you give us an update of what commercial initiatives you plan to use out of the gate and generally what the overall split could be between digital advertising, prescriber targeting, and other field rep initiatives?

Daniel Barber (Chief Executive Officer)

Sure. Roanna, did you have a second question, or was that the question you wanted to put out?

Roanna Ruiz (Analyst at Lyric Partners)

Oh, that was the first one. The second one, I did have a question about pre-approval information exchange with the PBMs. How much does that set up coverage discussions, and can you give us a little color around that?

Daniel Barber (Chief Executive Officer)

Sure, absolutely. Well, first, good morning, and appreciate that you instantly went to, of course, where our focus is on the commercial launch. Look, we feel great right now. We feel like we’ve managed our cash, we’ve got a strong cash position, we’ve maintained guidance, we’re under review. Sherry and her team are preparing for launch. So you’re absolutely right that the commercial initiatives are a place of focus. And Sherry’s right here with me, and I’ll let her walk you through the digital advertising and sales thoughts she has.

Sherry Korczynski (Chief Commercial Officer)

Good morning, Roanna, thanks again for the question. We’re so excited here. When you think about it, never has a product offered what Anaphylm will offer to both the allergist community as well as to caregivers and patients. It’s truly a 360-degree approach to anaphylaxis management that has never been done before. And so it is critically important for us, as we are completing the build of our senior staff, our district sales managers, our sales training.

Our supply chain is all ready to go, and as you know, it’s based in the U.S. We are working diligently to prepare for the sales force and those non-personal promotion efforts. While I’m not going to get into the details as far as percent of spend, as we’ve mentioned before, the allergists are key and we will have approximately 75 representatives calling on around 8,000 customers. These are the top-tier allergists, some pediatricians, and otolaryngologists. So we know and absolutely believe that having surround sound with those key customer targets is very, very important.

So not only will our sales representatives be addressing—my medical colleagues are out at conferences, and they will continue to be out with the allergists to continue to drive our message around our clinical efficacy as well as the other key benefits of the product—being it’s so easy to carry, it’s very easy to use. So you will see a nice split, Roanna, amongst the marketing initiatives and those sales force initiatives. If the deep question is really, are we going to be launching into TV and things like that, there will be a time and a place for major DTC efforts. As Dan has mentioned, we plan to be efficient with our spend. As we see those opportunities, we’ll begin to invest further.

Daniel Barber (Chief Executive Officer)

So let me, Roanna, take the second question, which was around the pre-approval PBM interactions. These are—and what I believe your question was, what’s the extent of what you can do there?—these are really important engagements, and tying into what Sherry just outlined. We feel very strongly that the opportunity in this space is to bring healthcare providers and patients back to the clinical data. The autoinjector has been the de facto leader for 45 years because it’s the only thing out there, not because the data is the reason for that product.

So we have an opportunity in our pre-approval interactions with the PBMs to show them our data. And I’m very fortunate to work with a great team, including Melina Ciope and Matt Greenhaw, who are here with me this morning, who will walk that clinical data with our PBMs and really show them why we think we’re differentiated. So we’re not—we understand that the dance to get to contracting is a difficult one for any pharmaceutical company. However, we do believe that that clinical data can lead the way for us as we move forward.

Roanna Ruiz (Analyst at Lyric Partners)

Sounds great. Thanks.

OPERATOR

Thank you. Our next question comes from the line of Kristin Kuska of Cantor. Your line is now open.

Kristin Kuska (Analyst at Cantor)

Hi, good morning, everybody, and congrats on the resubmission acceptance. Two questions for me. The first is, when you received that acceptance, did you get any word or comments about whether the FDA would kind of be reviewing everything from scratch, or really the key focus was on the new data and information that you’ve shared since? And then the second question is, I’m just curious. This past year has given you more time, and you’ve obviously collected more data as a company—what would you say has changed the most in terms of your expectations on what this launch or product could look like versus where you were a year before you had done these additional studies and work? Thank you very much.

Daniel Barber (Chief Executive Officer)

Thanks, Kristin. So, in terms of the acceptance, I’ll turn it over to Melina in a second, and she can walk you through her thoughts. I will say this: with the FDA, we’ve obviously been, we think, appropriately vocal is the way I would put it, that this is a pretty limited package. And we believe there’s an opportunity, especially with where the FDA is publicly talking about speed of review and transparency and all of the things they want to do. We do believe there’s an opportunity for a faster review here.

We don’t control that—so that’s completely up to them—but I want to make sure everyone knows that we are advocating for that and doing it appropriately, we believe. But I’ll let Melina give you her thoughts.

Melina Ciope

Sure. Good morning, Kristin. So, in terms of the focus of the review in the context of a resubmission, the focus is simply the complete response items that were outlined in the complete response letter. So when we hear from the Agency in terms of the acceptance of the submission, they are informing us that our response is complete to facilitate their review, and the focus of said review will be strictly—or intended to be strictly—on the resubmission scope.

So I hope that gives a little bit of clarity in terms of the scope of the data that will be reviewed, consistent with what Dan had mentioned.

Daniel Barber (Chief Executive Officer)

Thanks, Melina. So I will let Sherry give you some thoughts on learnings in a second here, but I just want to give, in my mind, what I think is the most important learning. And I’ll go back to Matt Greenhaw joining us in February. And I don’t know that this is due necessarily to having to deal with the packaging CRL that we’re having to deal with, but more from what’s important to allergists. And I think Matt has really championed in our company that the clinical data we have is really compelling.

And so that’s why you’ve heard us, if you go back through what we talk about on these calls over the last four to six quarters, we’ve really moved from this idea of, okay, we have interesting PK comparison data, to let’s really talk about the pharmacodynamic data and what it means to patients. And you heard in my prepared remarks, we really do understand and believe the only thing a patient cares about is that their severe allergic reaction stops.

And that is about the pharmacodynamic measures that we have, not necessarily PK comparisons. But I know Sherry has a lot of thoughts as well, so I’ll let her add on hers.

Sherry Korczynski (Chief Commercial Officer)

No, just to really add on to Dan is what has changed the most in the last year. Kristin, what I would say is, with bringing Matt on and having great deep understanding of this PD data, we have so much confidence in the differentiation Anaphylm has for patients and caregivers. And so what I would say is, we have to lean into the importance of trust and confidence. And so one of the key learnings that we’ve had is: do patients feel that they have to carry multiple devices?

Some do. Are physicians really confident in the data of the other, the newer products? And so for us, our ability to lean into the data, into having physicians and caregivers, patients alike, trust and be confident that Anaphylm is going to work in an emergency rescue situation—that is first and foremost. Look, the fact that we can carry it on the back of our phones, that it is very durable, that it’s easy to use—that’s all icing on the cake. We really truly believe that Anaphylm delivers confidence. It’s carried differently. So I would say overall that is our biggest learning in the last year. Kristin, thanks very much, everyone.

OPERATOR

Thank you. Our next question comes from the line of David M. Selem of Piper Sandler. Your line is now open.

David M. Selem (Analyst at Piper Sandler)

Hey, thanks. So two for me. First, in terms of the commercial launch and also your access initiatives, can you talk about what you’re going to do differently relative to ARS and its experience with neffy, both in terms of physician targeting, promotion, and access strategy? Love to hear how you’re taking learnings from their experience and applying it to Anaphylm. So that’s number one. And then secondly, on the Adreniverse platform, I know that you’ve talked about being judicious about spend on the programs here, but as you think about atopic dermatitis and that development program, can you give us a little insight into what other potential indications you can see yourselves moving into for the platform and what you’re going to prioritize over time beyond AD? Thanks.

Daniel Barber (Chief Executive Officer)

Thanks, David. Great to hear your voice. So I would say—and I’m going to hand it over to Sherry in a second here to talk about targeting and promotion in particular—I would say the focus, as a global comment, the focus that we’ll bring of where the place to start our story in this community is probably the number one thing that, compared to anyone who’s come out in the past years, you’ll see from us. But I’ll let Sherry give you her thoughts.

Sherry Korczynski (Chief Commercial Officer)

Hi David. Yes, thanks so much for the question. As it relates to, you know, we’ve discussed a lot about what are learning over time from the nasal device launch. What I will share again is our strategy is around depth in the allergist and high prescribing epinephrine writers community. We are going with a very targeted approach at about 8,000 to 8,500 key targets and our sales team will be very focused on all the execution, seeing the right targets with the right frequency and providing them with the right resources in order for them to have the confidence that Anaphylm will work in a rescue situation and a patient, quite frankly, will have it on them in the event that a situation occurs.

So I do see that our launch as compared to the other launch, that is a difference from a promotion perspective we talk about again we have. Our value proposition is not based around just one thing. It is not a singular value prop. Our value prop is focused on efficacy to drive trust and confidence for the prescriber and their patients and caregivers. It’s around the ease of carrying and always having with you should an allergic reaction occur and then the ease of use and durability of the product.

So we do believe from a promotion perspective that all of our promotional materials, our NPP, the work that we’re doing currently in marketing for the reps to have in promotion are all going to be tied around this value proposition. And as it relates to the payers, as Dan mentioned, look, we want as many patients to have access to Anaphylm and it’s a top priority for us. Obviously rapid payer coverage is key. Managing the friction that our HCP offices is very important and so we continue to have very robust discussions with the payers and the PBMs who continue to tell us their significant interest in Anaphylm. It’s important to us to look at this holistically and set up a best-in-class hub and patient support service strategy and all of that work, David, is underway.

We have the luxury, if you would say, of time. And so our team has picked apart every piece of this launch so that we are very, very well prepared when the approval comes.

Daniel Barber (Chief Executive Officer)

So I just, David, want to circle a little bit more on the market access piece of this and I’ll say something that perhaps the cynics in our industry wouldn’t buy into, but I do believe from my interactions with the PBMs, I do believe they want to allow innovative products to be in the hands of the patients that they support from a payer perspective. They do want that, but they have a job to do. They have something that they’re trying to manage and that’s the costs of the medical and healthcare community.

So while we may not agree on exactly how to approach any particular product, when you’re going to a PBM and you’re saying you have an innovation and you’re asking for a premium to a generic auto-injector, you have to tell them why. You have to tell them why your product should be in that category. And that again is where we really believe the clinical data, and talking about how that clinical data manifests itself in the community, is an important factor in our market access story.

So we’ll continue those conversations and look forward to seeing how they unfold.

David M. Selem (Analyst at Piper Sandler)

And then the Adreniverse question.

Daniel Barber (Chief Executive Officer)

Thank you, David. I even wrote it down and I forgot to address it. So my apologies. Yeah, we were really excited about the long term potential of the epinephrine platform. It’s been frustrating, quite frankly, especially with having to deal with the CRL, that we haven’t been able to more quickly focus on the Adreniverse while we get Anaphylm through the regulatory process. The atopic derm is an entry point in our mind. As you know, we started with alopecia areata, but when you look at dermatology, atopic derma is a typical spot with a new mechanism of action or new way of approaching something that you get into a space.

So we will again continue to show with our atopic derm product that in 2027 we can show real proof of concept data that people can buy into. We also think outside of dermatology that there are some really interesting indications, one that I know is near and dear to Matt Greenhoff’s heart. We’re not prepared today to say what that is, but we are working on it forward to hopefully bringing it forward in 2027.

David M. Selem (Analyst at Piper Sandler)

All right, thank you.

OPERATOR

Thank you. Our next question comes from the line of Francois Brisepois of LifeSci Capital. Line is now open.

Francois Brisepois (Analyst at LifeSci Capital)

Hi, thanks for all the details here on the questions. I just wanted to actually go into more detail if that’s okay on a prior question because when you talk about the learnings of the last year and how to differentiate, it seems like there’s a strong emphasis now, you know, from the PK to now PD side of things. Can you explain a little bit why you think that is more important and how, you know, this is kind of a three part question, like why do you think the PD is so important and so relevant?

And then two, is that thought process appreciated? What’s the evolution of the appreciation from the medical community, especially with Matt going around and speaking to people about this? Has that evolved for them in the past year as well? And, yeah, I guess that. Just to start with that,

Daniel Barber (Chief Executive Officer)

Sure. Well, and I’m going to pass it over to Matt, but I’ll just say globally, I really do think that the simplest way to describe the concept is how fast can you stop a severe allergic reaction? And PD is obviously the first way to show that. But I’ll let Matt pick it up from there.

Matthew Davis (Chief Development Officer)

Good morning. Yeah, I mean, when you think about why do you give somebody epinephrine? They’re having a reaction, they’re starting to go into shock, showing other signs of hemodynamic distress. This is what epinephrine does. It abruptly raises your blood pressure and heart rate, and the speed of that response makes all the difference. As a clinician, that’s really all I cared about every time I gave epinephrine to a patient. The blood levels are great.

It’s a regulatory point, but it really has limited clinical translation. And what we’re seeing and what we believe we have with our product is something that works fast, and the resulting increases in heart rate and blood pressure are strong. And this difference—time is of the essence. And you really want that to kick in as fast and as high as possible. That’s how you get somebody out of danger. So I’m really excited. You know, we have some data that we’re going to present next week at the college meeting that better translates some of this from our OASIS study to show sort of really where that breakdown is of how if you focus too much on PK, you’re really missing most of the story in terms of resonation in the field. This resonates. Well, this is, again, every clinician, this is what you want to hear, not what the PK is, but how fast this is going to work, how fast is my patient going to respond?

That’s a very tangible message. It’s very approachable. I think the PK probably has been the harder thing for most of us to wrap our heads around for years, and I think how long I’ve consulted and worked with the company going back to 2018. You know, the TMAX story is great. And yes, we do PK, we certainly have great numbers on, you know, our TMAX is very fast and our CMAX is high. But again, that’s not what really matters to the patient. So I think we’ve been able to flip that message.

And either because of me or in spite of me, I think people are responding to it. And again, you know, this was my area of expertise for years. And to hear it from me, I think with the work that I’ve done in anaphylaxis, I think hopefully it’s helping. We’ll see.

Francois Brisepois (Analyst at LifeSci Capital)

That’s great. That’s super helpful. And can you just remind us how you compare to others on the PD side?

Matthew Davis (Chief Development Officer)

Sure. Our TE max, which is the timing of the peak of the heart rate and blood pressure, is fast. Depending on the study, we’re ranging between about five to eight minutes, depending on the blood pressure parameter, depending on the study, and then the heart rate response, 8 to 11 minutes. If you look in our 301 study, our 206 study for the comparators that we looked at, the earliest is a heart rate peak coming in at around 11 minutes and everything else is pushed out past 19 minutes.

Francois Brisepois (Analyst at LifeSci Capital)

Understood. Thank you very much. Thank you.

OPERATOR

Thank you. Our next question comes from the line of Mazi Alamohamed of Oppenheimer. Your line is now open.

Michael

Hi, thanks for taking our question. This is Michael on from Mazi. First question is could you share anything about the pricing relative to other auto-injectors and neffy and your expectations on formulary access in the first year, and would you be offering cash pay or copay programs?

Daniel Barber (Chief Executive Officer)

Sure. Thank you, Michael. So look, and this will be similar to what you heard me say in the August earnings call. We’re obviously spending a lot of time on the market access piece of our launch, engaging in the allowable pre-approval interactions. In terms of how we’re going to price the product, that is the one piece we’re going to keep to ourselves for right now. I think there are obvious dynamics in the marketplace that people can assess and come to their own conclusion on.

In terms of expectations on formulary, look, any drug that is going to be launched, there are a variety of PBMs that need to believe in your story and you need to have arrangements and ability to contract with them. And we’re going through that process. So as Sherry outlined before, when we get into 2027, how we’re able to show progress on that front will be an important thing we bring to this forum. In terms of the tools we’ll use, Sherry and her team—of course we’re going to have the typical tools for patients, whether it is, as Sherry mentioned, having a hub or it’s allowing people to use copay cards.

Things like that will of course be in our toolkit. The specifics and which ones we’ll use and not use, we’re not going to outline today. But I would say there’s just typical things you do in a launch that you’ll see us do, and I don’t think that will be surprising to people.

OPERATOR

Thank you. Our next question comes from the line of Raguro Salvaraju of HC Wainwright. Your line is now open.

Raguro Salvaraju (Analyst at HC Wainwright)

Thanks very much for taking our questions. Firstly, with respect to Anaphylm, I was just wondering if maybe Sherry could comment on which specialist prescriber subpopulation is likely to be the most receptive—kind of the earliest group of adopters, if you will—among the discrete groups of specialist prescribers that she mentioned in her prepared remarks. I also wanted to ask if the company could comment on the anticipated commercial receptivity for Libervant, which obviously is likely to be launched in the hands of your new partner, Eton, but wanted to see if you could comment perhaps on the degree to which the market is likely to be receptive to Libervant, in particular in the context of the other formulations and routes of administration for diazepam within the target indications for which Libervant is expected to be labeled.

And lastly, if you could comment on the degree to which you expect the commercial presence of Anaphylm and regulatory familiarity with the Anaphylm regulatory package to potentially provide you with any advantages going forward as you seek to develop and optimize the value of the Adreniverse platform. Thank you.

Daniel Barber (Chief Executive Officer)

Sure. Thanks, Ram. So I’ll let Sherry first start on the prescriber piece.

Sherry Korczynski (Chief Commercial Officer)

Hey Ram, thank you so much for the question. As we stated previously, we are focused on the allergist community first and foremost. We will be calling on approximately 8,000 physicians with our 75 or so reps—again, predominantly the allergists, as they are the highest prescribers. And then from there, there are also pediatricians and otolaryngologists, ENTs, that are high prescribers of epinephrine. Again, our launch is very focused. It is a big, big market.

However, we, with our team, will be focused on that community.

Daniel Barber (Chief Executive Officer)

Thanks, Sherry. So from a Libervant perspective, and Ram, you and I have known each other a long time. We’ve talked about Libervant for a number of years. This is a product that we feel very attached to here at Aquestive. So we think from a patient perspective it’s an important product. The product, as you know, when approved will be labeled for seizure clusters in the epilepsy space. This is a population that is in need of good solutions and solutions that will help them.

So we’re very excited to get it in the hands of patients and allow them to benefit from it. Why Eton? We did have a multi-bidding situation, so we had other companies we could have gone with. What I think Eton has done well, if you follow their story, is they—just like us; where I opened in my prepared remarks today with we’re executing, we’re hitting the things we said we would do—I think Eton is a company that does that as well. So in their launches they’ve demonstrated they can put product into patients’ hands in an effective way.

We really like that. And I also like their culture. I like that they put patients at the center of what they’re doing, and I think that bodes well with our culture. So we’re very excited to see how that launch unfolds once approved in 2027. From an Adrenaverse perspective, your point is well taken. There’s no doubt that, as Melina and Matt and the team work through the FDA interactions, as well as Melina, who’s championing the ex-US interactions, we learn more and more about Anaphylm or epinephrine prodrugs and what the possibilities are. And also we’re making the regulatory bodies more comfortable with the prodrug approach. So I definitely would agree that as time goes on, the familiarity with that platform will only help us as we spread into other indications.

OPERATOR

Thank you. As a reminder, to ask a question, you will need to press star 11 on your telephone. Our next question comes from the line of Thomas Flayton of Lake Street Capital Markets. Your line is now open.

Thomas Flayton (Analyst at Lake Street Capital Markets)

Hey, good morning, guys. Thanks for taking the questions. Just to follow up on a previous question, Sherry, with respect to early adopters, how did you weight Neffy prescribing in arriving at that target list of 8,000 to 8,500 prescribers? And then secondly for Dan, has FDA communicated anything to you about a pre-approval inspection of your manufacturing facility? Thanks.

Sherry Korczynski (Chief Commercial Officer)

Thank you so much for the question. Obviously with the nasal device launch about two years ago at this time, it is a component of how we looked at the targeting for our sales representatives. The larger component is obviously the size, the amount of epinephrine that a physician prescribes on an annual basis. But of course, we did look at it and make considerations.

Daniel Barber (Chief Executive Officer)

You know, Thomas, before I pass it over to Melina to talk about a potential PAI, just adding on to Sherry’s thoughts, one thing I think that sometimes gets lost in the sauce: in this space we’ve done a lot of survey work, and I’m sure the other branded products in this space have as well. None of the surveys do we get information back from patients saying we love auto-injectors, we want to keep them. So there is a big opportunity here, and we believe in that opportunity even more today than we did a year ago.

And when I watch Sherry and her team really think about how do we bring healthcare providers and patients into a world where they use a product like Anaphylm, these more innovative products, I think the position we have is compelling. It’s going to take time, but the opportunity is there. But I’ll let Melina talk about the PAI question.

Melina Ciope

Sure. So in terms of inspection activity, we did go through first round of the 10-month review interactions with the inspection group at FDA, and the focus was certainly on more of the routine clinical sites, which I recall us communicating previously. Here, there’s a six-month review timeline. We know that the inspection activity is still possible, particularly from a clinical site perspective. When it comes to the manufacturing plants, as you know, we have a U.S.-based manufacturing facility that has supported over the years not only products that are under review by the U.S. FDA, but certainly globally as well.

We are well prepared for when and if the agency wants to come to our manufacturing site during this review.

Daniel Barber (Chief Executive Officer)

And I’ll just add on to Melina’s point. Just remember, Thomas, from a manufacturing perspective, our base business remains steady and strong. In fact, on a year-to-date basis, Suboxone is actually up. It is a declining product over time, but year over year on a year-to-date basis, it’s actually up. On beef is growing nicely, and we’ll have Libervant coming into the plant as well along with Anaphylm. So that part of our business remains important and strong.

OPERATOR

Thank you. I’m showing no further questions at this time. I would now like to turn it back to Dan Barber for closing remarks.

Daniel Barber (Chief Executive Officer)

Thanks, Steven. Thank you to everyone for joining us this morning. As you just heard, we continue to gain momentum as we rapidly approach our March 16th action date for Anaphylm. As Sherry outlined, and Matt as well, the market opportunity remains compelling. We have the financing in place for our launch, and our base business remains stable. So we look forward to keeping you updated on our launch progress over the next few months. And with that, we will close today’s call.

OPERATOR

Thank you for your participation in today’s conference. This does conclude the program. You may now disconnect.

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