OMEROS CORP (OMER) Q4 2025 Earnings Call Transcript

Good afternoon, and welcome to today's earnings call for Omeros Corporation. Please be advised that this call is being recorded at the company's request, and a replay will be available on the company's website. I will now hand the conference over to Jennifer Williams, Investor Relations for Omeros. Please go ahead.

Thank you, and good afternoon, everyone. Before we begin, please note that today's discussion will include forward-looking statements. These statements reflect management's current expectations and beliefs as of today and are subject to risks and uncertainties that could cause actual results to differ materially. For a detailed discussion of these risks and uncertainties, please refer to the special note regarding forward-looking statements and the Risk Factors sections in our annual report on Form 10-K, which was filed with the SEC today. Today's call will include a discussion of certain non-GAAP financial measures. A reconciliation of these non-GAAP measures to the corresponding GAAP measures is included with Omeros' earnings press release issued earlier today, which is available on the Investor Relations page of our website and has been furnished with the Form 8-K we filed with the SEC earlier today. With that, I'll turn the call over to Dr. Greg Demopulos, Chairman and CEO of Omeros.

Thank you, Jennifer, and good afternoon, everyone. Joining me today are David Borges, our Chief Accounting Officer; Nadia Dac, Chief Commercial Officer; Dr. Andreas Grauer, Chief Medical Officer; Dr. Cathy Melfi, Chief Regulatory Officer; and Dr. Steve Whitaker, Vice President of Clinical. Two major successes made the fourth quarter of 2025 a turning point for Omeros. On November 25, we closed our previously announced asset purchase and license transaction with Novo Nordisk for our Phase III ready asset, zaltenibart. Then on December 23, we received FDA approval for narsoplimab now commercialized under the brand name YARTEMLEA for the treatment of hematopoietic stem cell transplant-associated thrombotic microangiopathy, or TA-TMA. Through the zaltenibart deal, Novo Nordisk received exclusive global rights to develop and commercialize zaltenibart, Omeros' proprietary human monoclonal antibody targeting mannan-binding lectin-associated serine protease-3 or MASP-3 and a small number of target-related very early-stage antibodies and antigen binding fragments.

MASP-3 is the key activator and is widely considered the premier target of the alternative pathway of complement. Omeros retains rights to its MASP-3 small molecule program, including the ability to develop and commercialize small molecule MASP-3 inhibitors across a range of therapeutic areas, including, but not limited to, ophthalmology, neurology, gastrointestinal disorders, dermatology, musculoskeletal diseases and oncology. Omeros also retains rights to its grandfathered MASP-3 antibodies with temporal and indication restrictions on commercialization and for use in advancing its small molecule therapeutics. The transaction resulted in an upfront cash payment to Omeros of $240 million with an additional $100 million in achievable near-term milestones. We're also eligible for another $410 million in one-time development and approval milestone payments and up to $1.3 billion in one-time sales and commercial milestones.

All told, the deal is valued at up to $2.1 billion in upfront and milestone payments. On top of that, Omeros is set to receive tiered royalties up to the high teens on net sales of commercialized products. As part of the transaction, we entered into a transition services agreement, or TSA, with Novo Nordisk. Under this TSA, we are providing and being reimbursed by Novo Nordisk for our employee costs and other expenses associated with services to facilitate the transfer and to maintain the continuous operation of zaltenibart studies and programs. Novo Nordisk will also reimburse Omeros for its inventories of zaltenibart drug substance and drug product. Our partnership with Novo Nordisk is mutually beneficial, underscoring the value of Omeros' science and development expertise while providing us with substantial and ongoing working capital and enabling Novo Nordisk to leverage its extensive experience and global reach to unlock the full potential of zaltenibart.

Novo plans to advance zaltenibart across PNH and multiple other indications. The ultimate beneficiaries will be patients. Omeros' second landmark achievement in the fourth quarter of '25 was FDA's late December approval of YARTEMLEA, Omeros' lead MASP-2 inhibitor, making YARTEMLEA the first and only approved treatment for TA-TMA. MASP-2 is the effector enzyme of the lectin pathway of complement in TA-TMA and this often fatal complication of stem cell transplantation is driven by lectin pathway activation. The FDA-approved indication for YARTEMLEA is broad, covering all TA-TMA in both adults and children at least 2 years of age. Unlike C5 and C3 inhibitors sometimes used off-label, YARTEMLEA by blocking upstream MASP-2 preserves the infection-fighting functions of the classical and alternative pathways of complement. This important mechanistic benefit is reflected in YARTEMLEA's approved label, in which there are none of the safety-related obligations usually required for complement inhibitors.

Specifically, no boxed warning, no Risk Evaluation and Mitigation Strategy or REMS program and no required vaccinations. As previously disclosed, we began preparations for the U.S. commercial launch of YARTEMLEA well before receiving approval, allowing us to hit the ground running. We've hired and deployed our entire field force of account managers and directors, market development managers, market access leads and medical science liaisons across all territories. Having supplied our distributors within the first 3 weeks of January, first sales occurred shortly thereafter. Within 24 hours of placing an order, both adult and pediatric TA-TMA patients are now receiving YARTEMLEA, including patients who have recently failed prior off-label C5 or C3 inhibitor regimens. Patients are receiving YARTEMLEA in both hospital and outpatient settings and third-party payer reimbursement has been received.

The per vial price for YARTEMLEA is approximately $36,000. Each vial represents a single dose. Across the pivotal clinical trial and the expanded access program, median utilization was 8 to 10 vials per treatment course. We expect the majority of the TA-TMA patient courses to be administered in hospital outpatient departments where the drug typically is purchased and billed by the hospital. With our field force fully deployed, we remain focused on the 80 highest volume transplant centers across the country. Those 80 centers represent approximately 80% of annual stem cell transplants in the U.S. At this early stage, our primary launch objectives are fourfold: First, to educate the entire transplant care team, including transplant physicians, nurses, pharmacists and reimbursement teams regarding the recently harmonized TA-TMA diagnostic criteria, thereby driving awareness, early diagnosis and treatment of the disorder.

On that front, beyond the 80 highest volume transplant centers, our field force has actively met with and detailed centers representing nearly 90% of the allogeneic stem cell transplant procedures performed nationally. Second, to support transplant centers in quickly obtaining their pharmacy and therapeutics or P&T committee approvals, adding YARTEMLEA to their formularies and streamlining their ordering processes to continue ensuring seamless access to YARTEMLEA in both the hospital and outpatient settings. Our progress has exceeded our expectations. YARTEMLEA has obtained P&T committee approval and is now on formulary at 50% of the top 10 U.S. transplant centers, 40% of the top 20 centers, 35% of the top 40 centers and approximately 30% of the top 80 transplant centers across the country. Third, to work with third-party payers to continue ensuring timely reimbursement consistent with the YARTEMLEA label and published diagnostic criteria.

To date, third-party payers have approved all pre-authorization requests for YARTEMLEA, meaning that insurers have agreed to prospectively cover those patients. Fourth, to finalize the Health Economics and Outcomes Research or HEOR analysis using the uniformly strong clinical efficacy data and favorable safety profile of YARTEMLEA to demonstrate its compelling cost effectiveness to health care providers and payers. We plan to publish the HEOR analysis for YARTEMLEA soon, and the results strongly support YARTEMLEA's clinical, economic and real-world value. We look forward to providing additional detail regarding the launch of YARTEMLEA during our upcoming earnings call for the first quarter of 2026. Beyond the U.S., our marketing authorization application for YARTEMLEA in TA-TMA is pending with the European Medicines Agency. We continue to expect a decision midyear. For commercialization of YARTEMLEA outside the U.S., we are evaluating potential partnerships, both broad ex-U.S. arrangements and regional collaborations.

We believe that these opportunities are substantial. As we have discussed in previous calls, the underlying biology of TA-TMA, endothelial injury and cellular damage spans a broad range of therapeutic areas. For YARTEMLEA, we are evaluating expansion opportunities in additional indications, including acute respiratory distress syndrome or ARDS, solid organ transplant-related TMA and other endothelial injury-related disorders. We also intend to advance our once-quarterly dosed MASP-2 antibody, OMS1029, which is Phase II ready as well as our MASP-2 small molecule program designed for once-daily oral administration. We expect that both our long-acting antibody, OMS1029, and our small molecule inhibitor programs are well suited for chronic indications, including those in nephrology and in neurology. Let's now examine our fourth quarter and full year 2025 financials. For the fourth quarter, Omeros reported net income of $86.5 million or $1.22 per share compared to the third quarter's net loss of $30.9 million or a loss of $0.47 per share.

Fourth quarter results include a net gain of $237.6 million resulting from the zaltenibart transaction with Novo Nordisk. In the fourth quarter, Omeros also incurred a $136 million noncash charge associated with the mark-to-market adjustment on the embedded derivatives related to our 2029 convertible notes and term loan. Excluding this charge, our fourth quarter non-GAAP adjusted net income was $222.5 million and our fourth quarter non-GAAP adjusted income per share was $3.14. Further strengthening our balance sheet in the fourth quarter in November, we used a portion of our $240 million upfront payment from Novo Nordisk to repay in full our $67.1 million secured term loan. Last month, we used another portion of the upfront to repay at maturity the remaining $17.1 million principal balance on our 2026 convertible notes. As a result, all indebtedness under our senior secured term loan and 2026 notes has been extinguished, leaving us with only a $70.8 million principal amount outstanding in 2029 convertible notes.

As of December 31, 2025, we had $171.8 million in cash and investments, an increase of $135.7 million from the quarter ended September 30, 2025. We anticipate that the YARTEMLEA program will be financially self-sustaining this year, and we expect the company to achieve positive cash flow in 2027. Let's turn now to development programs beyond our complement franchise. Our PDE7 inhibitor program evaluating OMS527 for cocaine use disorder is fully funded by a grant from the National Institute on Drug Abuse or NIDA. Animal cocaine interaction studies designed with NIDA toxicologists were completed and showed no drug interaction or safety issues, supporting the scheduled inpatient human study in cocaine users. FDA subsequently requested additional preclinical information before initiation of the inpatient study. Together with our collaborators at NIDA, we are scheduled to meet with FDA in the coming quarter to discuss that request.

Our targeted complement activating therapy or T-CAT platform has also made substantial strides. Our T-CAT platform represents a novel class of pathogen-targeting recombinant antibodies designed for broad use against diverse pathogens, including multidrug-resistant organisms or MDROs. MDROs are predominantly bacteria that are resistant to antimicrobial agents and are rapidly becoming a global threat. In 2024, sales of anti-infectives were $46 billion in the U.S. alone and $135 billion globally. Over the next 25 years, more than 39 million people worldwide are estimated to die from MDR bacteria alone. Unlike marketed antimicrobials, T-CAT is designed to kill pathogens regardless of resistance profile without promoting resistance. In well-established in vivo animal models considered predictive of efficacy in humans, T-CAT recombinant antibodies demonstrated effectiveness in treating life-threatening infections caused by both gram-negative and gram-positive bacteria, including those designated by the World Health Organization as priority pathogens.

Patents have now been filed and a publication on our T-CAT platform is expected in the coming weeks. Finally, our oncology platform continues to progress rapidly. IND-enabling studies are underway for OncotoX-AML, our biologic agent designed to treat acute myeloid leukemia or AML. AML is an aggressive and often fatal bone marrow and blood cancer. OncotoX-AML has shown broad application across AML genotypes, including historically difficult-to-treat mutations like TP53, NPM1, KMT2A and FLT3. These genetic mutations are collectively found in approximately 90% of AML patients. Across human tumor-bearing animal and in vitro human AML cell line studies, OncotoX-AML has consistently shown superior efficacy to current AML standard of care treatments. In a pilot study assessing the efficacy and safety of OncotoX-AML in nonhuman primates, a single course of OncotoX-AML resulted in selective, reversible and dose-related killing of myeloid progenitor cells, the cells that can mutate and lead to AML by up to 99%.

OncotoX-AML was tolerated with no safety signal of concern. Together with our clinical steering committee comprised of AML experts from leading academic cancer centers, we are designing our first-in-human clinical trial targeted for late next year. That concludes our financial corporate and development update. And I'll now turn the call over to David Borges, our Chief Accounting Officer, for a detailed discussion of our financial results. David?

Thanks, Greg. Net income for the fourth quarter of 2025 was $86.5 million or $1.22 of net income per share compared to a net loss of $30.9 million or $0.47 net loss per share in the third quarter of 2025. Fourth quarter results include a net gain of $237.6 million on the sale of zaltenibart to Novo Nordisk, which I will discuss in more detail in a moment. Results also include a $136 million noncash charge associated with the mark-to-market adjustment on the embedded derivatives related to our 2029 convertible notes and term loan. Excluding this charge, non-GAAP adjusted net income for the quarter was $222.5 million and non-GAAP adjusted net income per share was $3.14. This charge represents a noncash remeasurement adjustment and, excluding it, provides a clearer view of the company's operating performance during the quarter. As of December 31, 2025, we had $171.8 million of cash and investments on hand.

This balance includes the gross proceeds of the $240 million upfront payment received from Novo Nordisk in connection with the sale of zaltenibart and the full repayment of our $67.1 million term loan in the fourth quarter. In connection with the repayment of the term loan, all liens and covenants associated with the credit agreement, including the $25 million minimum liquidity covenant, were eliminated. In February 2026, we repaid at maturity the remaining $17.1 million principal balance on our 2026 notes. Following these repayments, our only remaining debt is $70.8 million in principal amount of unsecured 2029 convertible notes, which are not due until June 2029. Costs and expenses from continuing operations for the fourth quarter before interest and other income were $29.1 million, an increase of $2.7 million from the third quarter of 2025. Research and development expenses in the fourth quarter were primarily focused on YARTEMLEA and zaltenibart.

Interest expense in the fourth quarter was $8.7 million. The primary components of interest expense include the DRI royalty obligation, the 2029 notes, the 2026 notes and the term loan. Excluding the DRI OMIDRIA royalty obligation, which represents pass-through interest from Rayner to DRI and has no economic impact to us, as well as noncash amortization of debt issuance costs, discounts and premiums, contractual cash interest expense was $3.2 million compared to $4.2 million in the prior quarter, a decrease of $1 million. The decrease was primarily due to the repayment of the term loan in November 2025. In connection with the closing of the sale of zaltenibart to Novo, we recognized a net gain of $237.6 million. This reflects the $240 million upfront payment less $2.4 million in transaction costs. Concurrent with the closing of the transaction, we entered into a transition services agreement with Novo Nordisk to facilitate the transfer of acquired assets and liabilities and support the continued operation of relevant studies and program activities.

Costs incurred by the company under the transition services agreement, including third-party expenses and internal FTE costs, are expected to be reimbursed by Novo. Interest and other income totaled $1.1 million in the fourth quarter compared to $616,000 in the third quarter of '25, primarily reflecting higher average cash balances. In connection with the repayment of the term loan in November '25, we recognized a $17 million noncash gain related to the derecognition of the remaining unamortized premium. This was a one-time accounting adjustment associated with the repayment of the loan. And during the fourth quarter, we reported a $135 million noncash loss on the mark-to-market adjustment on the embedded derivative related to our 2029 convertible notes. The change in valuation was primarily driven by the increase in our stock price during the quarter, which rose from $4.10 per share at September 30, '25 to $17.18 per share at December 31, '25.

This embedded derivative reflects certain features of the notes, including the conversion option and interest make-whole provisions available to noteholders. Because the valuation of this derivative is influenced by our stock price and other market inputs, it can introduce significant volatility in our reported results from quarter-to-quarter. This adjustment is noncash and does not affect our operating performance or liquidity. As a result, we present non-GAAP adjusted net income and net loss to exclude the noncash nature of these volatile swings. Income from discontinued operations in the fourth quarter was $6.6 million, an increase of $16.2 million from the third quarter. The increase primarily reflects the absence of a large noncash remeasurement expense recorded in the third quarter following a downward revision of the forecast for U.S.-based OMIDRIA royalties. Now let's look at our expected first quarter 2026 results.

We anticipate that overall operating expenses from continuing operations in the first quarter of '26 will be comparable to the fourth quarter of '25. Research and development expenses are expected to be lower as zaltenibart-related expenses will be reimbursed under the transition services agreement with Novo. Sales and marketing expenses are expected to increase in the first quarter, reflecting costs associated with building our commercial infrastructure, including the hiring of a field sales force, marketing expenses and other commercial launch activities for YARTEMLEA. As YARTEMLEA is in the early stages of launch, we are not providing revenue guidance at this time. We typically do not provide guidance following a new product launch while the market access and physician adoption are developing until we're able to estimate revenue with greater accuracy. In the near term, we're focused on building physician awareness, expanding disease education and working with third-party payers to ensure timely reimbursement.

Interest and other income are expected to be slightly higher than in the fourth quarter of 2025, primarily reflecting higher average cash balances. Interest expense is expected to be approximately $8.1 million, reflecting the reduction in our outstanding debt and excluding any potential noncash adjustments related to the OMIDRIA royalty obligation. Income from discontinued operations is expected to be in the $5 million to $6 million range, again, excluding any noncash remeasurement adjustments related to the OMIDRIA contract royalty asset. And finally, one thing to keep in mind is that our reported results will continue to reflect mark-to-market adjustments on the embedded derivative tied to our 2029 convertible notes. These adjustments generally move with our stock price and can create significant volatility from quarter-to-quarter. Because these adjustments are noncash and unpredictable, we present non-GAAP adjusted net income and loss measures, and they do not affect our operating guidance. And with that, I'll turn it back over to Greg.

Thanks, David. Operator, please, would you open the call to questions.

Your first question comes from the line of Brandon Folkes with H.C. Wainwright. Adjustments on the embedded derivative tied to our 2029 convertible notes generally move with our stock price and can create significant volatility from quarter to quarter. Because these adjustments are noncash and unpredictable, we present non-GAAP adjusted net income and loss measures, and they do not affect our operating guidance. And with that, I'll turn it back over to Greg. Gregory Demopulos, Chairman and CEO: Thanks, David. Operator, please open the call to questions.

Congrats on all the progress. Maybe just two from me. How should we think about the progress of formulary additions across the top 80% of transplant centers in 2026? Obviously, you got off to a strong start there. So just sort of how should we think about the progress for the rest of the year? And then secondly, I know it's very early on in the YARTEMLEA launch, so kind of asking this with an asterisk. But any color on the real-world vial usage to date? Any early data suggesting a different number of vials in the real world versus what we saw in the clinical data?

Brandon, thanks. With respect to the first question, we're quite pleased with the P&T committee approvals that we've received so far for YARTEMLEA. It was really ahead of schedule, which I think indicates the strong interest and, frankly, the recognized need for the drug. I expect we will continue to see additional P&T approvals over the next several months. Our objective, of course, is to have P&T committee approvals across all of the top 80 and, frankly, beyond the top 80 sites. But I'll check with Nadia. Nadia, do you have any additional thoughts on that?

Yes, I completely agree with everything you said, Greg. And I will underscore how pleased we are with the speed with which these P&T decisions are being taken, which isn't always the case in a launch. Here, they're seeing the value and the urgency to treat patients with YARTEMLEA's value proposition. And I will add that in places where we don't have P&T approval yet, if it's still underway, it's not standing in the way of getting YARTEMLEA to the patients. And so we are seeing the use of YARTEMLEA in the hospitals even without a P&T approval in place.

I would just underscore that latter point from Nadia, which is despite in some of these centers not having P&T approval yet, we continue to see requests and sales of YARTEMLEA and use of YARTEMLEA for the benefit of the patients in those centers. So it's really been very encouraging and, frankly, validating of what we believe the importance and the need for YARTEMLEA is in these patients, both adult and pediatric, in both the hospital setting and in the outpatient setting. Your second question, Brandon, was tied to vial usage. I assume you're asking whether it's once weekly or twice weekly, but let me just make sure I understand the question.

Yes. Ideally. Just anything you're learning early on in the launch, which may be different to what we saw in the clinical data?

Yes, not really different. We are seeing once weekly and twice weekly usage right now; at an estimate, the split is about 70% once weekly, 30% twice weekly, twice weekly being more common in pediatric patients than in adult patients. We do expect that shift to move more heavily toward twice weekly dosing. What needs to occur and what our field force is doing is educating the transplant teams on their ability to dose twice weekly. It is allowed under our label, and that information is being well received by transplant teams across the centers nationally. I would expect that we would see that split move more heavily toward twice weekly dosing. Nadia, do you have thoughts on this?

Yes, absolutely. One of the execution tactics and the messaging that the field is focused on is the sense of urgency and not to wait because our label allows twice weekly dosing. In several instances, we're seeing urgency to treat and move a little faster if needed for the patients. The other encouraging point is the published policies we've seen to date with third-party payers are supporting prior authorization consistent with label. So it's not restricting the use of twice weekly dosing as needed.

Does that help, Brandon?

Very helpful. Congrats on the early launch progress.

Your next question comes from the line of Olivia Brayer with Cantor.

This is Sam on for Olivia. I have a quick one — you mentioned that you plan to be financially sustainable this year and then cash flow positive by 2027. Is that implying that you received the $100 million from Novo and you had to pay the 2029 notes? And then under the YARTEMLEA launch, what feedback have you gotten from the sales force when educating the teams? Has there been any pushback or roadblocks that you expect to smooth out by the rest of the year?

Sam, with respect to your first question, the comment about self-sustainability was really directed at the YARTEMLEA business in 2026, meaning the business itself would be self-sustaining in 2026. 2027 is our target for company positive cash flow. I hope that clears up any misunderstanding.

Yes. That's awesome. And then on YARTEMLEA, what kind of bumps in the road have you encountered? And what can you do to smooth those out?

Again, we'll get into this more in our Q1 call, which will be in about six weeks. I can tell you our sales team is very excited and enthusiastic about the responses they are receiving from the medical centers that they're detailing. We have already been in sites that represent about 90% of the allogeneic transplants done nationally every year. The response from those centers has been uniformly positive. There is an education process underway, but the eagerness to learn, the recognition of the urgency and the need for YARTEMLEA, and the benefits with the favorable safety profile are resonating strongly with the sites. All of the sites I am aware of have been very receptive. Nadia, do you have more information on that?

Yes. The receptivity has been extremely positive. Our value proposition is viewed as significant and addressing an unmet need. All of the effort we put into prelaunch education on TA-TMA, the signs and symptoms to identify it and the urgency to treat is paying off. Now with the first and only approved product for TA-TMA, that sense of urgency is playing out. If I were to pick on anything to smooth out, it's making sure we have even more education that supports our on-the-ground efforts and doing more through non-personal channels, because patients can come from many centers. We want to ensure we're supporting any HCPs that are looking for treatment and wanting to learn more about YARTEMLEA.

I agree with Nadia that we're focused on educating. I've been personally impressed by the steep adoption of that education across sites. They understand it and are receptive to the value proposition for their patients. This is a drug that works well, and when you look at the safety profile, it represents a favorable benefit-risk profile.

And if I can squeeze one last one in: regarding the EMA decision by midyear and partnership discussions, do you expect any impact from Most-Favored-Nation (MFN) rules and ex-U.S. pricing?

It's too early to discuss expectations around pricing in the EU. We are laser-focused on achieving approval. There is no approved treatment other than narsoplimab or YARTEMLEA anywhere in the world, including Europe. We see high interest, which was evident at the recent EBMT meeting. Our focus is getting it approved and making it available for European patients as we've already made it available through our expanded access program.

Your next question comes from the line of Steve Brozak with WBB.

I'd like to go back to the value proposition. Given your compassionate use programs and all the drug you've given out and the literature that's been published, the hem-oncs are very familiar with YARTEMLEA. Can you go into as much detail as possible as to the value proposition? These are very sick patients and a lot of resources have been expended on them financially and in medical care. I'd like to put into perspective the criticality of what has just been done and what you're now doing. I've got a follow-up after that, please.

Steve, with respect to the value proposition, I mentioned in the prepared remarks the work we're doing on HEOR and we plan to publish those analyses soon. They are compelling and make a clear case for the economic, clinical and real-world benefits of YARTEMLEA. We think there is a strong case and we'll be publishing that.

I'm looking more for dollars and cents as to scale and order of magnitude when you're seeing these transplant patients. Those are not just critical procedures, they are very expensive. Can you give an idea of what patients or insurers and hospital systems are spending now? Also, what products were used before and how effective were they?

Overall transplant costs and related costs run about $1 million. You spend considerable resources, and then TMA can occur unpredictably. I want to be careful speaking directly to numbers. Previously, off-label C5 and to a lesser extent C3 inhibitors have been used. Those costs are public. What we do know from the published literature is that C5 inhibition has been associated with markedly increased infection rates — in some reports up to a sixfold increase in infection-related mortality. That carries significant cost beyond the cost of the agents themselves. We believe our pricing reflects a clear economic value proposition for narsoplimab or YARTEMLEA, and layered with clinical benefits, it becomes very compelling.

A follow-up: since this is a critical mishap, how fast can you respond to clinicians watching patients deteriorate in those first critical days? What feedback can you give there?

We have set up our distribution channels to deliver drug within 24 hours of the request. Our preference is to move treatment upstream — to treat patients earlier and aggressively — and the purpose behind establishing 24-hour delivery is to reach the site quickly. Request comes in, drug goes out. We are seeing the effects of that, and we'll continue to do so.

Even before shipment, if there's any question or support needed for prior authorization, our team will either go to the site in person or jump on a call to address those questions, whether it be our reimbursement manager, account manager or MSLs. We have a model designed to act immediately, and we have multiple examples of that. In addition to the 800 number and in-person calls, drug is delivered within 24 hours.

With respect to pre-authorizations, as I mentioned in the prepared comments, all pre-authorization requests have been approved by third-party payers to date. We're early in this launch — the launch was in January — and at the end of March we're talking about pharmacy and therapeutics committee approvals. We're very pleased and expect these to continue to move through. The numbers I gave you reflected approvals to date and I did not include those actively in process, which are substantially higher.

Congrats on the developments in 2025 and what you've told us about Q1.

Your next question comes from the line of Serge Belanger with Needham.

Greg, you mentioned all requests for access to YARTEMLEA have been granted. Were these via medical exceptions or is there formal formulary coverage for the product at this point? And since we're at the last day of the quarter, is it too early to talk about how many patient starts we've seen so far that have started treatment on the product?

We won't provide patient start numbers today, Serge. We'll discuss those in the Q1 call. Regarding your first question, I'll turn that to Nadia.

The answers are both. There are published policies for YARTEMLEA in the public domain that are prior authorization to label. In places where we don't see a published policy yet, those requests are being handled by medical exception, also prior authorization to label. Our intent going into the launch was to have policies that are PA to label, and that strategy is playing out. We have a strong national account manager team that follows up with payer requests for in-services, presentations and the value narrative, which is critical to those conversations. We are very encouraged and have had strong success to date.

Great. And Greg, regarding the $100 million milestone you described as near term from Novo — how confident are you in receiving this milestone and can you give color on what triggers it?

By agreement with Novo Nordisk, we are not able to specify what those milestones tie to. I will tell you that we are confident around the receipt of those. I cannot guarantee them, but our level of confidence is high.

There are no further questions at this time. I will now turn the call back to Dr. Demopulos for closing remarks.

Thank you, operator. Thank you all for joining this afternoon. 2025 ended strong, and 2026 has continued that momentum. The strategy we set for the company is playing out, and we are well positioned now for success. We look forward to speaking with all of you again in about six weeks when we'll provide a more detailed update on our YARTEMLEA launch. We appreciate your continued support, and have a good evening.

This concludes today's call. Thank you for attending. You may now disconnect.