ANI Pharmaceuticals, Inc. Aktie

Good day, everyone, and welcome to today's ANI Pharmaceuticals, Inc. First Quarter 2026 Earnings Results Call. Please note this call is being recorded. [Operator Instructions].

It is now my pleasure to turn the conference over to Irina Koffler.

Thank you, Liz. Welcome to ANI Pharmaceuticals First Quarter 2026 Earnings Results Call. This is Irina Koffler, Investor Relations for ANI. With me on today's call are Nikhil Lalwani, President and Chief Executive Officer; Stephen Carey, Senior Vice President and Chief Financial Officer; and Chris Mutz, Senior Vice President and Head of ANI's Rare Disease Business. You can also access the webcast of this call through the Investors section of the ANI website at anipharmaceuticals.com. This call is accompanied by a slide deck that can be accessed by going to the Events section of the Investors page of our website.

You can turn to our forward-looking statements on Slide 2. Before we begin, I would like to remind everyone that some statements we make today may be considered forward-looking statements, as defined by the Private Securities Litigation Reform Act. ANI cautions that these forward-looking statements are subject to risks and uncertainties, including those noted in our press release issued this morning and our filings with the SEC that may cause actual results to differ materially from those projected in the forward-looking statements. ANI specifically disclaims any intent or obligation to update these forward-looking statements, except as required by law.

During this call, we will also refer to certain non-GAAP financial measures. These non-GAAP financial measures should not be considered as an alternative to financial measures required by GAAP. The non-GAAP financial measures referenced on this call are reconciled to the most directly comparable GAAP financial measures in a table available in the slide deck accompanying this call. The archived webcast will be available for 30 days on our website, anipharmaceuticals.com. For the benefit of those who may be listening to the replay or archived webcast, this call was held and recorded on May 8, 2026. Since then, ANI may have made announcements related to the topics discussed, so please reference the company's most recent press releases and SEC filings.

And with that, I'll turn the call over to Nikhil Lalwani.

Thank you, Irina, and welcome again to ANI. Good morning, everyone, and thank you for joining us for ANI's First Quarter 2026 Earnings Call.

Starting on Slide 4. In the first quarter, we continued to deliver on our goal of accelerating our transformation into a leading Rare Disease company and meaningfully further our commitment to serving patients, improving lives. Specifically, in the first quarter, we grew total net revenues 20% year-over-year, driven by strong performance across our Rare Disease and Generics businesses, along with contributions from an innovative intellectual property out-licensing agreement that will provide us with royalty revenues for years going forward. We also grew adjusted EBITDA 24% year-over-year while making strategic investments into our Rare Disease business to accelerate its growth. These strong first quarter results enabled us to raise our 2026 financial guidance for total revenue to the range of $1.08 billion to $1.14 billion, and adjusted EBITDA to the range of $285 million to $300 million. I'm highly encouraged by our first quarter performance, which positions us well to drive meaningful growth in 2026 and beyond.

Turning to Slide 5. Earlier this year, we outlined top 3 priorities for 2026, and I'm proud of all of the hard work our team has put in to generate strong momentum as we execute against these priorities. The first priority is to accelerate our transformation into a leading Rare Disease company. Central to this effort is maximizing the multiyear growth opportunity for Cortrophin Gel, our lead Rare Disease asset. We delivered $75.1 million in Cortrophin Gel net revenues for the first quarter, up 42% year-over-year and consistent with the expectations we outlined during our last quarterly call. The fundamentals remain strong, and we exited the quarter with clear traction across our target indications. We saw accelerating momentum across our new patient starts and monthly volumes dispensed in February and March. This momentum has persisted in the second quarter with April having the highest number of new patient starts and monthly volumes dispensed since launch.

We have also made significant strides this quarter in expanding our Rare Disease organization to capture the sizable and unique opportunity in acute gouty arthritis flares by targeting podiatry and primary care. We have recently hired and onboarded the majority of our new dedicated commercial team, who will be in the field in the second quarter. We expect to have our full organizational expansion completed and operational by the end of June. This, together with the continued strong demand across other core indications, provides a solid foundation to drive significant revenue growth in the back half of the year. We believe we are well positioned to achieve our 2026 guidance of $540 million to $575 million in Cortrophin Gel revenues.

For ILUVIEN, we delivered $19.3 million of revenue in the first quarter, up 20% year-over-year, as we continue to execute on the commercial and patient access initiatives we established in 2025. In particular, we made meaningful progress on generating and sharing clinical data with the retina community, including our recent publication of NEW DAY results in DME. We're also on track to announce results from the Phase IV SYNCHRONICITY clinical trial in NIU-PS at a medical conference in the third quarter of 2026. Over the long term, we continue to believe the addressable patient populations in DME and NIU-PS represent at least 10x the number of patients treated with ILUVIEN today, representing a significant and durable opportunity for value creation.

Turning to Slide 6. We entered into a transaction with Harmony Biosciences, under which we exclusively licensed certain intellectual property to Harmony, which expands its intellectual property estate for pitolisant. In addition, we provided Harmony a co-exclusive license with which Harmony and Novitium, a subsidiary of ANI, intend to develop a novel formulation of pitolisant in broad CNS indications. In the first quarter, we received a $15 million upfront license fee. Additionally, we have the potential to receive an additional $10 million milestone payment upon achievement of certain development milestones, and expect these development milestones to be achieved in the second and third quarters of 2026. We will also receive low single-digit royalties on pitolisant-based products. Harmony's guidance has WAKIX delivering net revenues of $1 billion to $1.04 billion in 2026.

Turning to Slide 7. Our second priority is continued execution in our Generics business by leveraging our superior R&D capabilities, operational execution and U.S.-based manufacturing footprint as well as maintaining our current cadence of 10 to 15 launches annually. Similar to our Rare Disease franchise, we are able to report meaningful progress on this front. Year-to-date, we have already launched 6 new Generics products and continue holding our position as the #2 player in overall CGT approvals.

Our third priority is managing a disciplined capital allocation strategy. We continue to explore inorganic opportunities to expand the scope and scale of our Rare Disease business. We are also focused on driving organic growth by investing in our dedicated organization for Cortrophin in acute gouty arthritis flares and investing a high single-digit percentage of Generics revenues into Generics R&D. Our confidence in the business is further evidenced by our new $100 million share repurchase program authorized by our Board.

Turning to Slide 8. We are encouraged by our first quarter performance and the important progress we've made against our strategic priorities. We are seeing strong momentum coming out of the quarter and are well positioned to achieve our newly raised 2026 financial guidance. In 2026, we expect to deliver over $1 billion in revenue, representing 26% growth over 2025, at the midpoint of our guidance range, and Rare Disease is expected to account for approximately 60% of our total revenues in 2026 with Cortrophin Gel growing 60% year-over-year. We also expect to expand the bottom line with adjusted EBITDA forecasted to grow 27% year-over-year. Our balance sheet is healthy with the capacity to support future business development opportunities to expand scope and scale of our Rare Disease business.

With all of this recent progress, we are continuing our virtuous cycle of growth with which our Generics and Brands businesses generate meaningful cash flows to support our Rare Disease business as we accelerate our transformation into a leading Rare Disease company.

I'll now turn the call over to Chris to discuss our Rare Disease business in more detail. Chris?

Thank you, Nikhil, and good morning, everyone. Starting with Slide 9. Cortrophin grew 42% year-over-year to $75.1 million, in line with our expectations in the first quarter. We drove momentum across our underpenetrated specialty indications and made significant progress on our organizational expansion to capture the unique opportunity in acute gouty arthritis flares.

As a reminder, consistent with prior years and typical industry dynamics, Cortrophin's performance in the first quarter reflected seasonality primarily related to the impact of insurance reverifications. In the first half of the quarter, insurance reverifications took slightly longer to clear as compared to the prior year due to increased Cortrophin patient volumes in the physician offices and in some parts of the country due to weather-related physician office closures that temporarily delayed the reverification process. As physician offices worked through the reverification backlog, Cortrophin sales began to ramp back up. In fact, we saw an acceleration in February and March, which carried into April. April achieved the highest number of new patient starts and monthly volumes dispensed since launch.

We are also pleased with the underlying fundamentals. We delivered year-over-year growth across all of our targeted specialties of rheumatology, nephrology, neurology, pulmonology, and ophthalmology. Prescribing for Cortrophin Gel in acute gouty arthritis flares remained a key driver this quarter. This indication is unique to Cortrophin Gel among ACTH therapies and represented approximately 18% of total utilization. We also continue to realize meaningful revenue synergies in ophthalmology with first quarter Cortrophin volumes in ophthalmology doubling over the same period a year ago. I'm proud of our commercial team's execution this quarter that positions us for significant growth in 2026.

To capture the multiyear growth potential of Cortrophin Gel, we continue to focus on 3 key strategic priorities: high ROI commercial initiatives, investment to generate robust clinical evidence to support physician decision-making and confidence in Cortrophin Gel, and enhancing patient convenience. I want to focus my comments today on our investments in high ROI commercial initiatives.

Turning to Slide 10. Building on the commercial expansion we executed in 2025, and following a successful pilot program, we are taking the next step to capture the unique opportunity for Cortrophin Gel in acute gouty arthritis flares with our new 90-person dedicated organization targeting primary care and podiatry. The majority of our commercial team has been recently hired and onboarded. They will be in the field and meaningfully engaging with prescriber targets in the back half of the second quarter. Further, our sales team is equipped with new promotional materials focused on acute gouty arthritis flares that we believe will assist significantly with our educational efforts. We expect to have the full team deployed by the end of the second quarter, focusing on the 7,000 HCPs that treat the most severe patients outside of our prior call points in rheumatology and nephrology.

While we anticipate the expansion to begin impacting Cortrophin Gel volumes in the second half of 2026, we expect a greater impact in 2027, as the team reaches full productivity. There are several reasons why we are confident about the opportunity in acute gouty arthritis flares. First, it represents a significantly underpenetrated market opportunity. There are roughly 10 million patients in the U.S. with gout, about 36% receive treatment annually. They have 1.5 to 2 flares on average per year, and only 8% of those patients receive an injectable flare treatment.

This group of 285,000 patients represents our addressable patient population and a majority of them are treated in settings called on by our new team. Second, Cortrophin is the only approved ACTH therapy for acute gouty arthritis flares. Third, we have a proven track record in this indication. Prescribing for acute gouty arthritis flares represents approximately 18% of Cortrophin Gel use to date, driven primarily by use in rheumatology and nephrology. Last year, we ran successful pilots across 10 territories in primary care and podiatry, and we continue to see momentum in these territories. This data gave us further confidence to expand our organization to capture the broader opportunity in gout.

Finally, our organization build-out further enables us to continue expanding the ACTH market, which is pictured on Slide 11. Already, prescribers who were previously naive to ACTH represent approximately half of our total Cortrophin Gel prescriber base, and this cohort will continue to grow. The ACTH market is expected to reach over $1.3 billion in sales in 2026 with Cortrophin expected to grow 55% to 65% year-over-year.

On Slide 12, turning to our retina franchise. We're advancing several initiatives to support ILUVIEN sales. We're committed to generating clinical data for the overall retina community. We're pleased that last month, the results of our NEW DAY study of ILUVIEN in patients with DME were published in Ophthalmology, a leading globally respected peer-reviewed journal. We also expect to share results from our SYNCHRONICITY Phase IV study of YUTIQ now promoted under the ILUVIEN label in chronic NIU-PS at a medical meeting in the third quarter.

In addition, our commercial team is focused on educating and engaging the retina community, and they are conducting peer-to-peer educational programs and field activities with updated marketing materials to enhance physician understanding of ILUVIEN and its 2 indications. We also continue to work with physician practices as they navigate ongoing Medicare market access challenges that have persisted since January 2025, including exploring alternate access pathways.

I'm proud of all of the progress our team made this quarter and believe we are well positioned to accelerate our transformation into a leading Rare Disease company.

With that, I will now turn the call over to Steve to detail our financials.

Thanks, Chris, and good morning to everyone on the call. I'll now review our first quarter results and 2026 guidance in more detail. Starting with Slide 13. ANI total net revenues were $237.5 million in the first quarter, up 20% over the prior year period. Revenues from Cortrophin Gel in the first quarter were $75.1 million, up 42% from the prior year period, performing in line with our expectations. As Chris noted, first quarter 2026 results were impacted by seasonality related to the impact of insurance reverifications that took slightly longer to clear in January and February. ILUVIEN net revenues were $19.3 million in the first quarter, up 20% from the prior year period.

As Nikhil mentioned, in January, we entered into a licensing transaction with Harmony Biosciences. We recognized $21.5 million of associated revenues in the first quarter, consisting of the $15 million upfront license fee and the initial royalty income on sales of WAKIX. Revenues from Generics in the first quarter were $105.4 million, an increase of 7% over the prior year, driven by the continued strength in the partnered generic launch that commenced in the third quarter of 2025, contribution from new product launches, and commercial and operational outperformance.

Turning to Slide 14. Non-GAAP cost of sales increased 28% to $93.1 million in the first quarter of 2026 compared to the prior year period, primarily due to net growth in sales volumes and significant growth of royalty-bearing products. Non-GAAP gross margin in the first quarter was 60.8%, a decrease of approximately 230 basis points from the prior year period, principally due to higher sales of royalty-bearing products, including Cortrophin Gel, the partnered generic product launch that occurred in the third quarter of 2025, the nonrecurrence of prior year revenues from Prucalopride, as well as lower brand sales year-over-year. These effects were somewhat tempered by the initial revenue recognition under the Harmony agreement.

Non-GAAP research and development expenses were $10 million in the first quarter, essentially flat with the prior year period. Non-GAAP selling, general and administrative expenses increased 12% to $71.4 million in the first quarter, driven by initial marketing and recruitment expenses for our organizational expansion for Cortrophin in acute gouty arthritis flares, as well as an overall increase in activities to support the ongoing significant growth of our business. Adjusted non-GAAP diluted earnings per share was $2.05 for the first quarter compared to $1.70 per share in the prior year period. Adjusted non-GAAP EBITDA for the first quarter was $63 million, up 24% compared to the prior year period.

We ended the first quarter with $311.2 million in unrestricted cash, up $25.6 million as compared to $285.6 million as of the December 31, 2025 balance sheet. Cash flow from operations was $58.4 million in the first quarter. As of March 31, 2026, we had $625 million in principal value of outstanding debt, inclusive of our senior convertible notes and term loan. At the end of the first quarter, our gross leverage was 2.6x, and our net leverage was 1.3x our trailing 12 months adjusted non-GAAP EBITDA of $242 million. Driven by first quarter performance, we are pleased to raise our 2026 financial guidance for total net revenue, adjusted non-GAAP EBITDA, and adjusted non-GAAP EPS, which reflects significant top and bottom line growth.

Our guidance outlined on Slide 15 is as follows: We now expect 2026 net revenue of $1.08 billion to $1.14 billion, up $25 million from previous guidance. We are reaffirming our guidance for Cortrophin Gel net revenue of $540 million to $575 million. And from a quarterly cadence perspective, we expect second quarter Cortrophin Gel revenues to represent approximately 21% to 23% of total 2026 Cortrophin revenues. We then expect further sequential gains in the third and fourth quarters, driven by continued performance of our portfolio, pulmonology and ophthalmology teams in addition to the full deployment of our commercial organization focused on acute gouty arthritis flares. Revenues associated with this expansion will first occur late in the second quarter and are expected to build momentum throughout the second half of the year.

We are reaffirming our ILUVIEN net revenue guidance of $78 million to $83 million. And we now expect non-GAAP adjusted EBITDA of $285 million to $300 million, up $10 million from our previous guidance. From a quarterly cadence perspective, we expect second quarter non-GAAP EBITDA to be essentially in line with first quarter as the increase in Cortrophin Gel revenues will be tempered by the nonrecurrence of the $15 million upfront license fee recognized in the first quarter. We then expect strong sequential growth in adjusted non-GAAP EBITDA in the third and fourth quarters driven by Cortrophin Gel revenue gains. We now expect adjusted non-GAAP earnings per share between $9.19 and $9.69.

We are also adjusting upward gross margin expectations and expect adjusted gross margin to be 59.9% to 60.9% in 2026, up 60 bps from our previous guidance. We continue to anticipate between 21.5 million and 21.8 million shares outstanding for the purpose of calculating full year non-GAAP diluted EPS and a full year U.S. GAAP effective tax rate of approximately 26% to 28%. Finally, we are pleased to announce a new 3-year share repurchase program to repurchase up to $100 million in common stock. This reflects the strength of our balance sheet and our ongoing confidence in the business. This program provides us with another tool in our capital allocation strategy, which is centered on creating long-term value for our shareholders.

With that, I'll turn the call back to Nikhil.

Thank you, Steve. Turning to Slide 16. In closing, we are making meaningful progress against our strategic priorities to accelerate our transformation into a leading Rare Disease company, continuing to execute in Generics and deploying capital in a disciplined manner. Overall, we expect to deliver over $1 billion in revenue in '26 with Rare Disease representing approximately 60% of total revenues. We are on track to achieve our raised 2026 financial guidance, which reflects significant top and bottom line growth.

Operator, please open up the line for questions.

[Operator Instructions] Our first question comes from David Amsellem with Piper Sandler.

So I just have a couple. First, on the mix for Cortrophin. Can you talk to how much of your growth is coming from the non-gout settings like pulmonology/sarcoidosis and ophthalmology? And how much of the mix is in those other high-growth settings other than gout? So that's number one.

And then also, I wanted to drill down on number of vials and duration of treatment in the various indications. My understanding is that in gout, it's a pretty short course. Pulmonology, ophthalmology, others, there's more vials, there's more duration. So help us better understand those dynamics. And then last question is on payer access. As you gain more and more of a footprint overall and particularly in gout, can you talk about how access dynamics might evolve?

Yes. Thank you, David. So your first question is where is the growth coming from? Our previous year sales was $348 million, and our guidance for this year is $540 million to $575 million. So that's growth of approximately 60%. Majority of that growth comes from what I would refer to as core indications are the ones that we have been focusing on since launch, which is rheumatology, nephrology, neurology, pulmonology and ophthalmology. And there is acute gouty arthritis flares as part of that, but coming from the prescribers being rheumatologists and nephrologists.

Now when you think about the gout expansion that we've done this year, as Chris mentioned in his remarks, the team is pretty much hired and trained and is going to be in the field starting in the back half of this quarter. So you'll see some revenue impact in this quarter, but it will really ramp up towards Q3, Q4. But there's a much greater impact that's going to happen in 2027 from this expansion that we've done of a dedicated commercial organization for acute gouty arthritis flares, targeting primary care and podiatry.

So to summarize again, majority of that growth from $347 million going to $540 million to $575 million will come from our core indications and with our prescribers with those core indications. And then there's a subset of the growth that is coming from the gout expansion that we're doing this year. We'll see the full-scale impact and operating leverage in '27. So that's the answer to question one.

Regarding the vials by different therapeutic areas and indications. You're absolutely right that there is a variance. Cortrophin is prescribed across specialties, and there is specialties like pulmonology and nephrology that have higher vials or PFS per patient. And then there is multiple sclerosis, gout, which have lower vials per flare. And I would just remind that in some cases, the patients do come back and they may have used Cortrophin a couple of years ago, but then will come back the next time an exacerbation or a flare comes up. So that's a bit of the color that we can give you on vials or duration. across indications. And obviously, there's a continuum there across different specialties and different indications.

And then on third is payer access. We brought competition to a category that had no competition in ACTH when we launched in 2022, and have been focused on expanding access and serving the significantly underpenetrated addressable market across indications. And what you'll see with the 30% growth implied in our and our competitors' guidance is that we're both focused on reaching the patients for who ACTH therapy is appropriate, and expanding the access as we are doing that. I'm trying to keep it a bit general because as you would expect, there's stuff that is competitively sensitive that we need to just balance while sharing information that's helpful for investors. So thank you, David.

Our next question comes from Vamil Divan with Guggenheim Partners.

So I guess I have a couple of questions related to the guidance increase. And I guess, ties into the Harmony deal. So just to confirm, it sounds like you already recognized $15 million upfront license fee. So I'm assuming that's already included in your guidance expectations. And then there's this $10 million in development milestones that you're expecting in 2Q and 3Q. So my question is, is that already included in your guidance as well? If it is, then that sort of accounts for the $25 million guidance raise for the company as a whole. So I'm wondering how you're thinking about the royalties that you'd get on top of that. Is that included in your guidance? Because if that is, I'd almost wonder why the guidance and especially the EBITDA guidance maybe is not going up by more given the impact of this acquisition?

And then my second question -- sorry, that was a little bit of a long question. The second one is on Cortrophin. I understand the reauthorizations took longer than expected in the first half of the first quarter. But the prescription data that we're seeing publicly through IQVIA, those sources still looked very, very strong. So I'm just wondering if you can maybe help explain the disconnect there, because I would think that if the reauthorizations are taking longer, it would lead through in terms of the prescription data, but maybe it doesn't and maybe I'm wrong on that. So if you can just clarify how we should think about interpreting any of the publicly available prescription data?

Sure. So thank you, Vamil. So I'll take your second on Cortrophin and the IQVIA first, and then I'll come back to the guidance. So look, in the past, IQVIA has been directionally in line with our performance. However, we can't comment on the recent disconnect as it is third-party data, and we do not have insight into all their inputs. And that's why what we've tried to do is share internal metrics that are useful for investors, right? And as you would expect, operationally, we remain focused on our internal metrics and leading indicators we use to manage the business while obviously watching the external metrics, too.

And what we have shared, right, is that we exited the quarter and began Q2 with significant momentum across our target indications. We saw accelerating momentum across monthly volumes dispensed and new patient starts in February and March, and we've spoken to some of that when we reported in February. And then this momentum has persisted in the second quarter with April having the highest number of new patient starts and monthly volumes dispensed since launch. So that's the answer on Cortrophin and related to the IQVIA clarification that you had sought.

And then on the guidance, look, our guidance included, when we had issued the guidance, it included the Harmony deal, right? So our initial guidance, which we issued in January, included Cortrophin at $540 million to $575 million, ILUVIEN at $78 million to $83 million, revenues from the out-licensing agreement, gross margin at 59.3% to 60.3%, and adjusted EBITDA at $275 million to $290 million. Our newly raised '26 guidance retains Cortrophin and ILUVIEN revenue guidance. And so for the guidance increase, it's really driven by high Generics revenues on the back of first quarter and visibility into new product launches for the rest of the year. That's one.

Second is clarity around the milestone achievement of the $10 million, the development milestones that is there in the Harmony agreement. So we have more clarity around when that can be achieved. And I think Steve had spoken that, that will be achieved in the second and third quarter, that $10 million will be achieved across the second and third quarter of this year. And third is just refinement of the royalty revenues expected for this year based on the updated 2026 guidance issued by Harmony.

Our next question comes from Dennis Ding with Jefferies.

Congrats on a very good Q1. So on the Q2 soft guidance, it seems to imply $117 million to $128 million for Cortrophin at the midpoint. Maybe talk about the pushes and pulls on that number and what's driving your confidence today in achieving that? And how much visibility do you have on orders over the next 45 days? That's question one.

And then question number two, if I think about Cortrophin guidance for the year, I feel like what I'm really trying to get comfortable with is maybe around an incremental $50 million in second half gout revenue. When I do the math, that implies around, let's say, 1,500 to 2,000 flares that need to be treated in the second half, but you're also going after 7,000 HCPs. So maybe only a small proportion then just needs to treat a single flare in the second half to bridge the $50 million in gout revenue. Do you agree with that math? Or is there something that we're missing here?

Right. So thank you for your questions, Dennis. So the first question is on the Cortrophin guidance and the quarterly evolution that we spoke to. So look, as we said, we exited the first quarter with significant momentum, right, and saw accelerating momentum across monthly volumes dispensed and new patient starts in February and March. We exited and then began Q2 with significant momentum. We shared that both in terms of volumes dispensed and new patient starts, April is the highest of all time, right? We believe that momentum will sustain, right? And so we are reaffirming our guidance for Cortrophin of $540 million to $575 million.

And then what you have in the third and fourth quarters, right, and this goes back to the first question that I answered for David, is that the third and fourth quarters will have continued performance of our portfolio, pulmonology and ophthalmology teams. And in addition to that is the full deployment of our commercial organization, right? So we have completed that hiring and training, right, for the most part. It will be fully complete by the end of June, right? So the revenues associated with this expansion will first occur late in the second quarter and then are expected to build momentum through the second half of the year, which is in the third quarter and fourth quarter.

I mean, for reference, we're adding 64 new sales reps. And as you're thinking about number of patients and number of enrollments, number of physicians, I think the broader -- I would just zoom out a little bit and say, there are 285,000 patients that we believe are in the addressable market, and we believe that they have an unmet need where Cortrophin Gel may be an appropriate treatment. And they're being treated by physicians that we are currently not reaching. So consistent with our mission of serving patients, improving lives, we've done an investment to reach these patients, first of all, and as a consequence, also expand the ACTH market, because we're reaching a completely new set of prescribers that for the most part, other than those 10 pilots that we had done last year and have seen significant success in and continue to see momentum in this year, we were not really accessing. And so really, this is about reaching that much larger patient population through the expanded sales force.

And again, we remain confident with the addition of 64 reps, right, of seeing momentum build for that in the back half of the year, but also the bulk of the growth from $347 million to $540 million to $575 million coming from the core portfolio of pulmonology and ophthalmology team. And when I say portfolio, I mean reps that detail into nephrology, neurology and rheumatology.

Our next question comes from Glen Santangelo with Barclays.

Nikhil, I just want to follow up on sort of your previous response regarding the guidance. I mean, you're making the case that the licensing fee was included in the original guidance, but it was unclear to me what you were saying about the milestone payments. Were they in the original guidance? Or is that incremental now? I just want to make sure I'm clear on that. And then I had a follow-up.

Yes. I think that when we gave the initial guidance, we take into account -- it took us time to figure out the timing for the development of these -- sorry, for the achievement of the milestone related to the development. So we baked that into the revised guidance. And look, there are multiple factors that are impacting the raised guidance, as I spoke about earlier, right? So there was the higher Generics revenues on the back of first quarter and visibility into new product launches for the rest of the year. The second is the clarity around the achievement of the $10 million development milestones.

And look, we're also retaining some flexibility to invest further across Rare Disease and Generics as we ramp through the year, right? Because we have tremendous growth opportunities across both, right? So we're retaining some flexibility to invest further in the latter part of the year as needed.

So thank you, Glen. And I think you have a follow-up. Please go ahead.

Yes. Maybe I'll shift gears and ask you a quick question on ILUVIEN. Based on your full year guidance and what you sort of did in 1Q, it doesn't seem to be that you're expecting any sort of sequential growth in this product throughout the year. And I was wondering if you could just update us on your sort of commercial and patient access initiatives, because it seems like you're just sort of expecting $20 million a quarter for the balance of the year.

Yes. So thank you for your question, Glen. We've deployed these commercial and patient access initiatives starting towards the end of '25 and heading into '26. And we're seeing the impact from those in a strong Q1. And we're just calibrating, right? As we look ahead, the foundation-related access issues have not resolved. We've obviously made some progress with alternate access pathways for patients that do have the pharmacy benefit. But we're calibrating as we give guidance on what will come towards the rest of the year.

We have a lot to look forward to, right? We spoke about the release of the NEW DAY clinical study results, publishing of that in Ophthalmology as well as in Q3 at a medical conference releasing data on ILUVIEN in NIU-PS, the study is called SYNCHRONICITY. And so there's a number of things that we are working on, initiatives that we're working on, but we're just being calibrated on where the guidance is versus where we started.

Our next question comes from Ekaterina Knyazkova with JPMorgan.

Just wanted to talk about the data generation strategy. Do you think that it makes sense generating additional data in some of the older indications as a kind of way to increase adoption? And if so, what indications do you think would be the most interesting there? And then second question is just on BD, just latest thinking in terms of appetite or priorities for the company.

Thank you, Ekaterina. So in terms of generating scientific and clinical evidence, it's something that we've been focused on right from year 1 of the launch. We've invested in generating preclinical evidence that shows the differentiated mechanism of action of Cortrophin Gel and supports the physician use of Cortrophin. And we're continuing to explore and work collaboratively with physicians to identify areas where we can do that. You obviously know about the Phase IV study that we have in acute gouty arthritis flares.

We've also got other publications we've done in the other indications. And we continue to sort of evaluate and make investments in generating scientific and clinical evidence, and we'll keep you updated. Obviously, there is a competitive angle to this and balancing what we're sharing from a competitively sensitive standpoint. But generating scientific and clinical evidence is an area we're absolutely committed to for Cortrophin and supporting the growth of this franchise.

And then when it comes to BD, it is a critical and important part of our capital allocation strategy. We are exploring ways to expand scope and scale of our Rare Disease business, looking at commercial assets that can leverage either the sales team that we have that go into multiple call points, or the rest of the Rare Disease infrastructure that we have that support market access, specialty pharmacy distribution, patient support, medical affairs, marketing, all of that Rare Disease infrastructure that we have in place that can support us reaching patients in rare indications. So identifying a commercial asset that can leverage these capabilities that ANI has in Rare Disease to expand our scope and scale, we retain our focus on that and is a critical priority for ANI.

Our next question comes from Leszek Sulewski with Truist.

I have three. First, on the reverifications. Can you color -- do you expect any spillover of these lingering into 2Q? Or is it now mostly resolved? And are you aware of the magnitude of these issues among your competitor? And how should we expect similar reoccurrence in Q1 of next year? And then just to clear up on the Harmony settlement, is the royalty tied to all WAKIX sales or just future indications -- or future formulations? And do you have ability to sell this royalty stream? And would you consider going this route? And then just on the buybacks, is there an ASR component to the buybacks? And how should we think about priority of capital allocation strategy?

Yes. So thank you, Les. I'll take the first one, and then I'll hand it over to Steve to answer the one on the share repurchase as well as the Harmony royalties. So the headwinds that we saw related to Q1 seasonality and insurance reverifications taking longer to get through impacted the first half of the quarter. Physician offices have since worked through that backlog, and we saw the accelerating momentum across monthly volumes dispensed and new patient starts in February and March.

I think that as we head into -- to your question on what will happen in '27 Q1. As we get towards the end of the year and into '27 Q1, we will work with the physician offices. And we already have, as we've been working through these insurance reverifications on what can we do to collaborate to make these go smoother, and have identified a set of initiatives that we will deploy, and we would look forward to updating you as we get closer to that time frame. Obviously, there was some impact from the significant weather-related issues in the first half of Q1. That's something obviously that we -- that's mother nature and that will decide. But in terms of the insurance reverification process, we do have ideas that we're exploring and we will implement as we get towards the end of this year and heading into next year to support the physician offices.

And then I'll just turn it over to Steve to answer your question on Harmony royalties as well as the buyback.

Yes. So I'll pick the buy-up one first and Les, thanks for the questions. Just to position the repurchase program a little bit, and then I'll get to your specific question. As we said on the call, putting this in place at this time reflects our confidence in the balance sheet, the cash generation that we've achieved to date with $311 million on the current balance sheet, but our overall confidence in the future prospects of the business, which includes an expectation for significant cash flow generation in 2026.

To be clear, our principal goal for the excess cash on our balance sheet remains to support future business development and M&A. And within that framework, the addition of the buyback program really just gives us another tool in our tool belt as we actively manage the capital allocation plans going forward. Our shareholders should expect us to judiciously allocate cash between investment behind the strategic growth and diversification of the business, delevering our balance sheet and return of any excess capital to shareholders. And to your specific question, Les, at the current time, there is no plan for an ASR to be implemented within this buyback program. Thank you.

And then sorry, on the...

Harmony.

Yes. So on the Harmony royalties, the royalty is due on all pitolisant products, including WAKIX, and any future products that may be introduced that is pitolisant based. And in terms of whether we would sell that royalty stream or not, we typically don't discuss any potential future BD. At the moment, we're just very pleased with the collaboration with Harmony and look forward to executing our portion of that out-licensing deal.

Our next question comes from Brandon Folkes with H.C. Wainwright.

Congrats on a very good quarter. I just want to follow up on an earlier question regarding the prescription growth we're seeing where we sit versus reported revenue on Cortrophin. A few sub-questions here. As the ACTH category grows, are you seeing any additional payer management across the board? And then on Cortrophin again, any changes in rebates or contract terms for 2026 versus 2025? And then lastly, I guess, the level of patient support you provided in 1Q 2026, was that within what you would expect for a first quarter? Is it comparable to the prior year? And are you seeing any change in usage patterns in gout? A lot in there, but I appreciate it.

Brandon, thank you for your question. So your first question on payer management and then your subsequent question on rebates. Look, we try to provide as much information as we can to be useful to investors. But some stuff is competitively sensitive and what's happening on the payer landscape as well as on rebates is competitively sensitive. So we'll not be able to give you specifics there.

What I can say is that our efforts since we've launched is to bring competition to a category that has not had competition and to reach more patients, right? Over half our prescribers are ones that were naive to ACTH and had never considered ACTH before writing their first prescription of Cortrophin Gel. So we're really trying to reach that larger addressable market. And we believe that as with our efforts and also the competitors' efforts, there are more patients that are appropriate for ACTH that are getting access to this therapy, right? So I think that's what I could say in terms of expanding access and having patients access this therapy. So that's on your first 2 questions.

And then with regards to patient support, no, the patient support in 2026 -- sorry, in 2025 Q4 and heading into 2026 Q1 was much more than the patient support that we had in 2024 Q4 going into 2025 Q1, because we obviously knew there were a lot more patients on therapy in 2025 Q4 and that would need insurance reverifications. I believe that's what you were trying to understand. And so we made the expansion of our patient support team. But there are 3 different stakeholders that play a role in insurance reverifications and one of which is the physician offices. So I think that's across the 3 where we had the volumes that went into some of those physician offices and then it was exacerbated by the weather-related delays is what led to the insurance reverification issues.

And then on gout, I think what I could share that would be useful is, gout as a -- acute gouty arthritis flares as a percentage of Cortrophin volumes has grown to 18%, majority of which comes from rheumatology and nephrology, because that's what we were originally focused on. So that obviously is seeing a lot of momentum. And then the cities in which we did the pilots, those territories are also seeing momentum, and that momentum has persisted even after the pilots have concluded. And obviously, some of the pilots have just translated into this new acute gouty arthritis, gout expansion team, and we're continuing to see momentum in that team, too.

Our next question comes from Thomas Smith with Leerink Partners.

On Cortrophin, could you just expand on some of those comments, Nikhil, with respect to the 10 primary care and podiatry centers where you executed the pilot programs last year? Maybe is there a way to quantify, I guess, the potential continued growth and maybe the uptake from those centers now that you're a bit removed from the pilot? And what other learnings could you apply from that experience?

And then on the Harmony licensing transaction, can you just talk about what a potential development path looks like for the novel formulation of pitolisant? Maybe a little bit of color on time lines, how you think about potential value generation from that asset? And then are there other monetizable IP assets in that portfolio that could drive maybe similar transactions here over the next couple of years?

Great. And thank you, Tom, for your questions. So on the pilots, look, we're continuing to see momentum both in new patient starts and volumes dispensed and the momentum is significant, right? And obviously, we keep monitoring that, and that continues to give us confidence in this expansion that we've done. And a lot of our expansion is architected based on what we learned from the pilots, right?

So when you think about how do you identify primary care and podiatrist physicians to reach out to, to reach. So we looked at the success in these pilots and were able to develop a set of criteria from claims data that helped us identify who is the physicians, primary care and podiatrists, which are very large populations, and then really focusing on the 7,000 HCPs that are treating the patients with the most severe acute gouty arthritis flare indications. And so a lot of that has been learning from there.

Second is what is the cadence, right? This is a different prescriber group than the ones that we've been going with initially -- or going to initially with our sales force. And so really learning like, hey, what's the cadence that would be appropriate for them? What is the messaging that's appropriate. We have a whole slew of new marketing material that is tailored to acute gouty arthritis flares and what are the messages that resonate. So a whole bunch of the architecture of our gout expansion really comes from the learnings from the 10 pilots.

Your second question on the development timelines for Harmony, and it's confidential to the collaboration and not one that I can speak to today.

And then the last one on monetizable IP. We absolutely keep working on IP that we can monetize, and collaborations that we can do from a development standpoint to create value for our shareholders, and Harmony is one step in that direction. And that's also part of the reason why, as Steve has highlighted, we now have these captured in a separate line under Cortrophin -- under Rare Disease and Brands.

Thank you. That concludes today's question-and-answer session. This concludes today's conference call. Thank you for participating. You may now disconnect.

Okay. Good afternoon, everyone. Thank you for joining us. For our next presentation, we're excited to have ANI Pharmaceuticals here with us. Representing the company to my right is Nikhil Lalwani, who's the President and Chief Executive Officer of the company; and to his right, Stephen Carey is the Chief Financial Officer of the company. For those of you who don't know me, I'll just quickly introduce myself. My name is Glen Santangelo. I'm the analyst at Barclays responsible for the specialty pharmaceuticals sector, among a few other things.

But again, we're very happy to have you here, Nikhil and Stephen. So thank you guys very much for taking the time out of your schedules.

Thank you, Glen, and thank you for having me.

Okay. Excellent. So why don't we just sort of dive right into it? I mean, 2025 was just a great year for the company. And I finally think that we can sort of reposition you no longer as a generics company that has rare disease assets. We're now going to call you a rare disease company that also happens to have a generics business as you cross that 50% threshold. So congratulations on that milestone.

Maybe a good place to start is if you just want to sort of level set everybody and talk about 2025 and the momentum you had sort of into the end of the year that set the stage for 2026 that will be a good place -- a good framework for us to dive in right after that.

Sure. Yes. Thank you, Glen, and thank you for acknowledging our transformation into a leading rare disease company. 2025 was important for the acceleration of that transformation into a leading rare disease company. As a company overall, we grew 4% on the top line and 47% on the EBITDA -- adjusted non-GAAP EBITDA line. The growth was fueled primarily by our rare disease business and within rare disease, Cortrophin, our lead asset, where we grew 75% to 76% to deliver $347 million (sic) [ $348 million ] in revenues in 2025. And then our generics business, which has played an important role in terms of providing EBITDA and cash flows also grew 28% to $384 million and gave us strong momentum going into 2026.

As we head into '26, we believe the acceleration of ANI into a rare disease company remains our top priority. We have 60% of our revenues coming from Rare Disease with Cortrophin growing to $540 million to $575 million from the $347 million we delivered in 2025. And the generics business with a significant outperformance in '25, staying flattish in 2026 to deliver an overall total company revenues of excess of $1 billion to $1.055 billion to $1.115 billion and the adjusted non-GAAP EBITDA line to $275 million to $290 million. Importantly, as we're driving growth, we're also balancing profitability. So we're growing 19% to 26% on the top line and 20% to 26% on the adjusted non-GAAP EBITDA.

Okay. Excellent. Well, thank you for all that background. I think it's sort of very helpful. And congrats on everything you achieved. I mean to see the 44% revenue and even have a little bit of margin leverage on top of that was incredible. Just looking at the stock, I mean, it's up a fair amount over the last sort of 12 to 14 months since the beginning of last year. I would have argued maybe even it should have been up a little bit more. But still, I mean, the market, I think, is slowly coming around. So it's great to see.

And maybe that's a -- let's start with Cortrophin Gel because I think that's clearly top of mind for everybody. And I'm trying to come back to that comment on the stock performance versus the revenue growth and the operating profit, growth that we saw. I think one of the concerns that we hear, which maybe is a good place to start is just talking about the durability of this product and the growth. And you laid out the guidance for 2026, which is helpful. So clearly, you're confident. But how would you sort of explain to people to sort of give them confidence that Cortrophin Gel has a long runway here and that 2025 was an aberration. What gives you sort of that confidence in the growth?

Thank you for that question. We believe very strongly in the robust multiyear growth potential for Cortrophin. And it really starts with the patients. We believe the addressable patient population is significantly underpenetrated. If I take one indication as an example, acute gouty arthritis flares, there are 9.9 million patients in the country with that indication. However, only 36% receive treatment per year. Of those, only 8% receive injectable treatments because their flares are so acute. So our addressable patient population is 285,000 patients. That's what we think is addressable. So a very small patient population amongst the much larger incidents.

And we're significantly underpenetrated, right? We're less than 10,000 patients for treating that indication versus a 285,000 potential addressable market. So the runway, and this is true in -- there's a slide in our deck that covers it across multiple sclerosis, rheumatoid arthritis, nephrotic syndrome, sarcoidosis, across multiple indications. And it's across the category between us and the competitor ACTH significantly underpenetrates the addressable market across indications. So that's really the key opportunity, the key driver of growth, right?

Now we are able to reach these patients. And that's proven by over 50% of our prescribers since we launched are prescribers that were naive to ACTH. They've never written an ACTH drug before. So we're able to reach these physicians and consequently reach this larger patient population by reaching these patients. When you think about the market, right, since we've launched the -- in the last market, the deceleration slowed first. And then last 2 years, it's grown 27% and 45%, respectively, with -- so really, for us, this is a question about market growth, significant addressable market and both it's beneficial to actually have 2 players out there that are trying to increase the share of voice. So this is an alternate treatment option for the appropriate patients in need.

On durability, a very important part is additional competition, right? What is the risk of additional competition? And look, the way we see it, this is a very -- this tough category to genericize. This is an animal-derived, porcine derived, and it's then taken through a complex manufacturing process. There's a very large number of peptides that are immersed in a gel to make an exact copy of this and show equivalents is very complex. There are companies that have tried in the past and not been successful because it's a tough drug to genericize. When you think about someone going -- starting from scratch and trying to develop a new drug application, you have to go one indication at a time, run multiple studies and get approvals one indication at a time. So we believe there's a long multiyear growth opportunity. And so there's growth and durability in this, in Cortrophin.

Maybe I just want to come back to one thing you just talked about is the ACTH market. You sort of talked about the deceleration earlier years ago. And when you launched this product, I think, in 2022, you sort of reaccelerated the growth. Talk about -- give us a little bit of history here in terms of the deceleration of that market, what the issues were in the past. And clearly, you've had a positive impact. But Talk about how big this market was prior to those Acthar Gel issues and the market decline? And what's your view on the TAM of the market today versus maybe what we would have thought 5 years ago?

Sure. So...

And I just asked because maybe that it's the lack of confidence given the history in this market that maybe makes people -- I don't want to say, use the word skeptical, but right, it certainly is on people's minds.

Sure. Yes. The market was -- so the ACTH market was $1.2 billion in 2017. And then it reduced over time to about $600 million in 2021. And we believe that the reduction in sales happened for a number of reasons that were exogenous external to the efficacy of the ACTH product and that involved a competitor having litigations, bankruptcy, other issues that didn't really have to do with does an ACTH product help appropriate patients. We've launched in January of 2022. And since we've launched, the -- as I said, that the market has reduced the degrowth and then really returned to growth. And if you look at where we are exiting '25, the market is basically back at the previous peak, right?

If you take the 4Q run rate or even the total year sales, we're essentially back at the previous peak. But we're just getting started because the addressable patient population is much, much larger, right? And if you think of where ANI's growth has come from, this has not come from share capture. A big portion of our growth has come from reaching new patients. 50% of our prescribers were naive to ACTH. It probably not even heard of the category before we launched. In addition, 15% of our volume comes from acute gouty arthritis players in an indication that was the competitor does not have and did not have in that previous peak. So we feel very confident of the ability to drive significant market growth by reaching the appropriate patients in need.

And can you talk about some of the differences between yourself and your key competitor in terms of -- and you talked about the indication is a little bit different, but if you could just sort of elaborate a little bit on the differences between the products.

Right. So both products are porcine-derived. However, there's a difference formulation and different composition of peptides that are in their product as well as our product. There's also a complex and different manufacturing process for the active ingredient as well as the -- for the API as well as for the finished dose formulation. So the products are different. They're from -- they're in the ACTH category, right? They have different indications.

So there's a number of overlapping indications that both products have, but they have infantile spasms that we don't, and we have a number of different indications. But from a commercialization perspective, acute gouty arthritis flares is the main indication that we've been commercializing that or focusing on for commercialization that they don't have.

All right. Stephen, maybe just a couple of quick financial questions before we leave Cortrophin. You talked about expanding the sales reps by 90 in the middle of the year, right? So that's going to add some incremental operating expenses and maybe drive some accelerated growth in the second half versus the first half. But also on the conference call, you sort of laid out a case that maybe some of the insurance verifications might be happening in January a little bit slower. And so that when we think about the first quarter, maybe it might be a little bit lighter relative to what we would normally expect.

So if you could just sort of walk people through the cadence of 2026 and how we should think about that 55% to 65% growth that you expect for the year, how that may play out from a cadence perspective?

Yes, sure, absolutely. And thanks for the question. I think of the Cortrophin revenue cadence really in 3 different layers, Glen. right? If you look at 2025, given the growth profile that Nikhil has been talking about, we had sequential growth throughout 2025. And the base of the 2026 forecast is for that continued acceleration, right? All of the resources we had behind the product leaving the 2025 year are still in a growth mode and driving further utilization of the product. And so the base layer is continued evolution of growth in the product. And with the always present for Rare Disease and for Cortrophin, a sequential step down Q1 versus Q4 of the prior year due to insurance reverifications. That's the base of the forecast.

The second layer of the forecast is the 90-person additional employees that we're putting behind the gouty arthritis flares indication. And that team is being recruited today and will be in the market detailing the product by midyear. And so a step-up in revenues in the third and fourth quarter as that team comes online and starts to become productive. And the evolution of that team will continue into 2027 as they become more efficient. Those are the 2 core principles behind the guide.

And then what we did on the year-end call, just to give external constituents further insight is we did talk about due to the increased volume of reverifications that need to occur, that we're seeing that taking a little bit longer in January. And so we see a shift of certain that volume, a slight shift of that out of January into later months. And so we talked about the first quarter being down.

Doesn't go away.

It doesn't go away. It just shifts back by a month or so. And therefore, right, we just gave a little bit more specificity to the first quarter.

Okay. All right. Can we shift gears and talk about your other rare disease asset, ILUVIEN? It's been about 18 months since you acquired the product. I'm just trying to back up in my mind. A lot has happened with this product. And so when you rewind -- could you just remind us the rationale for the deal, the changes you made to the label? And with a lot of those changes sort of now behind us, obviously, do you think there'll be greater focus on sort of driving that commercial success in fiscal '25, if I want to label '25 as that sort of transitional year for the product?

Sure. Yes. Thank you. The acquisition of Alimera was anchored in picking a therapeutic area or specialty that was synergistic with Cortrophin from a sales force perspective. So we picked ophthalmology as a key therapeutic area. And so we -- and then what we did is we expanded the sales force. We got about 31 reps from the Alimera acquisition. We added another 14 reps. And now we have about 45 reps that are out there promoting both Cortrophin and ILUVIEN to retina specialists as well as ophthalmologists. So that's the industrial logic behind the deal.

As you rightly pointed out that 2025 for the retina assets, ILUVIEN was a reset year. As we head into '26, we have momentum from a number of the commercial and strategic initiatives that we put in place. We have a strengthened commercial team. We had the successful deployment of initiatives from a marketing and sort of commercial initiatives to back the strengthened commercial team. We also have the release of the NEW DAY clinical study results. We're using that NEW DAY study results to -- we believe the results of that study will support the use of ILUVIEN earlier in the treatment of DME. So that's been a positive that will carry into 2026.

We had some challenges with funding support for Medicare patients that don't have adequate co-pay funding. While there is no -- none of that funding return baked into our guidance, what we have done and have had success with in '25 is getting some of the leading retina practices to use alternate approaches for patients that have the Part D benefit to use that benefit to get access to ILUVIEN.

And then an important part you mentioned, which is ILUVIEN is now indicated for both diabetic macular edema as well as chronic noninfectious uveitis in the posterior segment of the eye. So we merged the label of YUTIQ, which was the original product into ILUVIEN and now just have one product that is with more detailing. And that's made it simpler for the physician offices as they deal with only one product for both indications as well as in terms of maintaining inventory since this is a product that...

Commercially, is that playing out as you expected, hopefully?

It is playing out as we expected. And then obviously, within uveitis, steroids are the standard of care. And if you think of a lot of the innovation that's happening in the retina area, it's around reduced treatment burden and increasing the duration of care. And ILUVIEN meets both those criteria by being a long-acting intravitreal injection, which microdoses fluocinolone acetonide into the eye over a 3-year period.

Okay. Well, we got about 5 minutes left, and I got a lot to cover. So we're going to start doing a little rapid fire. So I'm going to shift gears and I'm going to shift to the generics business. You came off a great 2025. You said the business grew 28%, even the exit rate was very strong in the fourth quarter. But let's think about that year in the first half of the year, you had Prucalopride, right, on 180-day exclusivity that probably benefited that. And then you had the partner launch in the second half of 2025, which may also be contributing to the growth. Are we setting ourselves up for a very difficult comp in 2026? Like how should we think about that sort of growth year-over-year, just sort of given those events that benefited 2025?

Sure. So historically, our generics business, we've oriented to high single-digit, low double-digit type growth. But we've outperformed that expectation every year. We've essentially, if you look since '21, we've grown at a 25% CAGR. We obviously had a very strong 2025. The anchors or drivers of that strong growth are a superior R&D capabilities and execution, supported by strong operational execution and a U.S.-based manufacturing footprint. All of these trends will carry into 2026. We invest high single-digit percentage of our generic sales into R&D, and that allows us to launch 10 to 15 new products annually, which will support in '26, the performance in '26 -- and our orientation for this year is for the generics business to stay relatively flat to last year's significant overperformance of 28% growth.

Okay. Perfect. All right. Just moving on the established brands. It's only 4% of your revenue, so we're just going to spend 20 seconds here. You basically grew another 16% in the fourth quarter. Could you talk about the durability of the growth there? Is it even worth having a conversation? I mean, help us think how you've been able to sort of continue. And I know there were some items in there that explain that growth, but...

Yes. Look, I think that from a capital allocation perspective, Rare Disease is our priority one. Generics and the brands business creates a virtuous cycle of growth that allows us to take the EBITDA and cash flows from these businesses and it reinvested into driving the growth of our Rare Disease business. And so we'll continue to capture opportunities that we get with the brands business, but it's sort of -- we have to be disciplined for capital allocation and make sure that we support rare disease. We support the growth of generics with investment in generics R&D and then let brands just play a role in terms of generating EBITDA and cash flow for the Rare Disease business.

Steve, shifting gears to the gross margin. We got a big mix shift going on at the company, and it's not always easy for us to see the gross margin evolve the different components of your business. Maybe you can sort of help us think through that a little bit, how the gross margin should trend. And we know you have the royalty that's now stepped up in the highest tier with respect to Cortrophin. So help us think about that gross margin progression '25 through '27 just sort of given the mix shift that's sort of transpiring?

Yes, sure. So when we think about our 3 businesses, we talk about our highest gross margin business is the legacy brands business that Nikhil just spoke about. On the other end of the spectrum, the generics business. And in between is the Rare Disease business, largely due to the royalty to Merck. As we think about evolution going forward, first of all, '25 to '26 is influenced by those mix changes, but also a big influence is the nonrecurrence of that Prucalopride 180-day launch in the first half of the year. So that's a big year-over-year item. And as we think about things developing going forward, as rare disease sales continue to advance and become a bigger portion of the overall company revenues, that will be accretive to the gross margin line.

I know we're not way too early to talk about 2027. But as we get through these comp issues in 2026, we get through the sales force expansion, hopefully, we start to see that leverage drop in 2027 on the gross margin side and on the EBITDA side, right, as you annualize those operating expenses that you plan to incrementally add in 2026. Is that like a fair characterization?

Yes, that's a fair characterization. And as Nikhil said -- touch earlier, right, as we're driving the business for growth and the mid- to long-term success of the business, we're very thoughtful in terms of balancing out the profitability profile.

Okay. Can we talk about the balance sheet? The leverage is back down to 2x. Yes, that's solid free cash flow. What's the thought process around BD at this point, appreciating you clearly had a lot on your plate the last 18 months around the Alimera deal, certainly have no shortage of things going on. But how should we think about the BD strategy at this point given where the balance sheet sits?

Sure. So we want -- we have significant growth opportunities organically, both with rare disease as well as generics and long sustainable growth sorry, durable and high-growth opportunities organically. So we want to make sure that the deal that we do, deals that we do sort of add to that. The focus is on increasing scope and scale of our Rare Disease business. The near-term focus is on commercial assets, right, assets that do not have clinical risk associated with it.

And I think the 2 types of assets, right? The ones that are synergistic with Cortrophin on a call point perspective. But secondly, and we're increasingly looking at this is assets that leverage the rest of our infrastructure, right, which is patient support, specialty pharmacy distribution, hub services, medical affairs, market access, the rest of the rare disease infrastructure, it does not matter if they're in an indication or a specialty that is different from the ones that Cortrophin overlaps because it allows us to focus on Cortrophin and then overall, continue acceleration of our transformation into a leading rare disease company.

We're out of time, but I did have one more question that I wanted to sort of squeeze in. We sort of framed everything. You exit 2025 on solid footing. You gave 2026 guidance sort of well above expectations. Again, I look at the stock essentially flat sort of year-to-date, and we can discuss the different reasons for that. But you're here at a conference, you're meeting with investors.

And I guess what type of feedback are you getting? And is there anything you want to share with the investors here in terms of dislocations in terms of maybe the questions you're getting, what they think versus what you see as reality or your opinion? Like how do you sort of reconcile sort of that disconnect maybe with the recent performance of the stock, recognizing 2025 was a pretty decent year?

Sure. Thank you for that opportunity, Glen. We believe that the long-term growth and durability of our businesses is underappreciated in rare disease. And I think that that's the message that I would leave with investors.

Yes, that's what I was going to do. I was going to flip it to you for the last word. I mean, so in your mind, you think it's the lack of confidence in the durability of your rare disease assets and the growth outlook. I mean, I want to give you the last word with investors, anything you want to leave anyone with, anything you think people misunderstand and then we'll close it out.

Yes, it's not the lack of confidence. I think that it's just understanding that more. This is we have patents into the 2040s on Cortrophin. There is a large addressable patient population that we can help address the appropriate patients. So there's a multiyear growth opportunity with Cortrophin. In ILUVIEN, we have a large addressable market that we're addressing, so 10x of what anything patients that we're treating today. Both drugs are tough to genericize. So we have a very long runway. And so we have a long-term growing and durable rare disease portfolio. And we have a balance sheet that can support expansion of the scope and scale of our Rare Disease business.

Okay. Nikhil and Stephen, we'll leave it there. Thank you very much. Thank you for joining us.

Thanks so much, Glen.

Thank you very much.

Good day, everyone, and welcome to today's ANI Pharmaceuticals, Inc. Fourth Quarter and Full Year 2025 Earnings Results Call. Please note, this call is being recorded. [Operator Instructions] It is now my pleasure to turn the conference over to Courtney Moverly. Please go ahead.

Thank you, Erica. Welcome to ANI Pharmaceuticals' Fourth Quarter and Full Year 2025 Earnings Results Call. This is Courtney Moberly, Investor Relations for ANI. With me on today's call are Nikhil Lalwani, President and Chief Executive Officer; Stephen Carey, Senior Vice President and Chief Financial Officer; and Chris Mutz, Senior Vice President and Head of ANI's Rare Disease business.

You can also access the webcast of this call through the Investors section of the ANI website at anipharmaceuticals.com. This call is accompanied by a slide deck that can be accessed by going to the Events section of the Investors page of our website. You can turn to our forward-looking statements on Slide 2.

Before we begin, I would like to remind everyone that any statements made on today's conference call that express a belief, expectation, projection, forecast, anticipation or intent regarding future events and the company's future performance may be considered forward-looking statements as defined by the Private Securities Litigation Reform Act.

These forward-looking statements are based on information available to ANI's Pharmaceuticals management as of today and involve risks and uncertainties, and including those noted in our press release issued this morning and our filings with the SEC. Going such forward-looking statements are not guarantees of future performance.

Actual results may differ materially from those projected in the forward-looking statements. ANI specifically disclaims any intent or obligation to update these forward-looking statements, except as required by law. During this call, we will also refer to certain non-GAAP financial measures. These non-GAAP financial measures should not be considered as an alternative to financial measures required by GAAP.

The non-GAAP financial measures referenced on this call are reconciled to the most directly comparable GAAP financial measures in a table available on the slide deck accompanying this call. The archived webcast will be available for 30 days on our website, anipharmaceuticals.com.

For the benefit of those who may be listening to the replay or archived webcast, this call was held and reported on February 27, 2026. Since then, ANI may have made announcements related to the topics discussed, so please reference the company's most recent press releases and SEC filings.

And with that, I'll turn the call over to Nikhil Lalwani.

Thank you, Courtney. Good morning, everyone, and thank you for joining us. 2025 was another year of outstanding execution and growth by the ANI team, highlighted by our remarkable results in the fourth quarter. At the core of everything we do is our purpose of serving patients improving lives.

With our progress in the last year, we are well positioned to continue delivering on that purpose in 2026 and beyond. Starting with Slide 4. In 2025, the company delivered record revenue adjusted non-GAAP EBITDA and adjusted non-GAAP diluted EPS, driven by strong performance across our rare disease and generics business unit.

For the full year, we grew total company revenues by 44% year-over-year and adjusted non-GAAP EBITDA by 47% year-over-year. In addition, we delivered exceptional growth for our lead rare disease asset, Cortrophin, with full year revenues up 76% year-over-year as we meaningfully expanded our reach in underpenetrated specialty indications and serve more patients. With our strong R&D and operational capabilities, our generics business continued to outperform, growing 28% year-over-year in 2025.

Turning to Slide 5. We believe the momentum we generated in 2025 positions us for continued growth in 2026. Our priorities for this year are threefold. First and foremost, ANI's transformation into a leading rare disease company. For our lead asset, Cortrophin Gel, we plan to maximize its multiyear growth opportunity by addressing the significant unmet need across indications.

We will continue to build on our momentum in the key underpenetrated specialty indications in nephrology, neurology, rheumatology, ophthalmology and pulmonology.

In addition, for building and deploying a 90-person organization dedicated to acute gardioarthritis fares. For this expansion, we plan to capture sizable and unique additional opportunity in gout to expanding awareness and adoption of Cortrophin for appropriate patients by newly identified physicians in polity and primary care.

For ILUVIEN we are focused on returning the product to growth by leveraging the commercial and patient access initiatives established in 2025. Importantly, we continue to believe in the long-term potential of ILUVIEN as we believe the addressable patient populations across DME and NI UPS are at least 10x the current number of patients treated with ILUVIEN today.

Our second priority is continued execution in our generics business by leveraging our superior R&D capabilities, operational execution, U.S.-based manufacturing and business development expertise as well as maintaining our current cadence of 10 to 15 launches annually.

We continue to make progress on this priority and anticipate another year of strong performance and cash generation from our generics business that will enable us to further invest in our rare disease business.

Our third priority is executing a disciplined capital allocation strategy. We are focused on driving organic growth by investing in our dedicated organization for Cortrophin in acute gartiarthritis flares and investing a high single-digit percentage of generics revenue into generics R&D and to drive inorganic growth by exploring opportunities to expand the scope and scale of our rare disease business. .

Turning to Slide 6. We believe the 3 2026 strategic priorities will drive long-term growth and value creation for the company. In 2026, we expect to deliver over $1 billion in revenue, representing 23% growth over 2025 at the midpoint of our guidance range.

Rare disease is expected to account for approximately 60% of our total revenues in 2026 with Cortrophin growing 60% year-over-year. We also expect to expand the bottom line with adjusted EBITDA forecasted to grow 23% year-over-year at the midpoint of our guidance range.

Later in the call, Steve will provide more detail on our 2026 guidance. In summary, 2025 was a pivotal year for ANI as we delivered record performance and drove significant growth across the business lines. We are entering the year from a position of strength and are focused on executing on our 3 strategic priorities.

We anticipate that our virtuous cycle of growth in which our generics and brands businesses generate meaningful cash flows to support our rare disease business will drive our transformation into a leading rare disease company.

I'll now turn the call to Chris to discuss our rare disease business in more detail. Chris?

Thank you, Nikhil, and good morning, everyone. Starting with Slide 7. Looking at 2025, I'm proud of our team as we closed out the year strong, delivering another excellent quarter, marked by significant growth for Cortrophin Gel as we expanded our reach in underpenetrated specialty indication. During the fourth quarter, the number of cases initiated and new patient starts reached another record high, and we saw broad growth across all of our targeted specialties, rheumatology, nephrology, neurology, pulmonology and ophthalmology.

Prescribing for Cortrophin gel and acute gouty arthritis flares remained a key growth driver this quarter. This indication is unique to Cortrophin gel among ACTH therapies and represented approximately 15% of total utilization. Notably, gardiaarthritis has also been a strong catalyst for new prescriber additions, including many providers who are previously unfamiliar with ACTH.

We also continue to realize meaningful revenue synergies and ophthalmology with fourth quarter Cortrophin gel volumes in ophthalmology over 2x that of the same period a year ago.

Ophthalmology remains a fast-growing targeted specialty for Cortrophin gel and we believe there is further upside as we expand awareness of Cortrophin gel for patients with severe allergic and inflammatory eye conditions.

Turning to Slide 8. Looking at the market more broadly, the ACTH space has returned to growth following the launch of Cortrophin Gel in 2022 and approached $1 billion in sales in 2025. We expect it to increase significantly in 2026 with Cortrophin gel growing by 55% to 65%. Turning to Slide 9. We continue to believe that the addressable patient populations across our key indications remain significantly underpenetrated.

For example, there are roughly 10 million patients in the U.S. with [indiscernible] about 36% received treatment annually, and they have 1.5 to 2 flares on average per year and about 8% of those patients with severe gadiarthritis and injectable treatment for their flares.

This group of 285,000 patients represent our addressable patient population. Importantly, prescribers who were previously naive to ACTH represent approximately half of our total Cortrophin gel prescriber base, and this cohort continues to expand.

We believe the most significant opportunity for growth is through overall expansion of the ACTH market by addressing unmet needs of appropriate patients. To capture the multiyear growth potential of Cortrophin gel, we continue to focus on 3 key strategic priorities outlined on Slide 10.

We are investing in high ROI commercial initiatives. Building on the commercial expansion we executed in 2025, we are now taking the next step to capture the unique opportunity for Cortrophin Gel and acute [indiscernible] flares with our new 90-person dedicated organization. There are several reasons why we are confident about the opportunity in acute gadiarthritis flares.

As I highlighted earlier, there is a large addressable patient population of 285,000 patients. Second, Cortrophin gel is the only approved ACTH therapy for acute cardio arthritis flares. And third, we have a proven track record in this indication. Prescribing for acute gadioarthritis laris represented approximately 15% of Cortrophin gel use in 2025.

In addition, we ran successful pilots across 10 territories in primary care and podiatry. This gave us further confidence to expand our organization to capture the opportunity in acute [indiscernible] The hiring process is underway, and we expect to deploy this team by midyear. While we anticipate the expansion to the impact in Cortrophin gel volumes in the second half was 2026, we expect a greater impact in 2027 as the team reaches full productivity. Additionally, we continue to focus on enhancing patient convenience.

Our Cortrophin gel prefilled syringe offering, which we launched in April of last year, simplifies administration and provides a more convenient option for patients.

The launch of the prefilled syringe has been well received by both patients and prescribers and continue to support broader adoption and serve as an important growth driver for Cortrophin Gel. Finally, we continue to invest in generating robust clinical evidence to support physician decision-making and confidence in Cortrophin Gel.

As part of this effort, we are advancing a 150-patient Phase IV study in acute [indiscernible] flares. This trial, along with ongoing collection of preclinical and real-world data across core indications is designed to reinforce Cortrophin Gel differentiated nonsteroidal mechanism of action and provide insights that may support adoption and treatment guidelines.

We also continue to generate robust preclinical data for our key stakeholders on Cortrophin Gel differentiated mechanism of action across multiple disease states. This remains a critical growth initiative. As expanding the body of evidence supporting Cortrophin gel use across indications help physicians make more informed treatment decisions.

On Slide 11, turning to our retina franchise. We are continuing to advance several initiatives to support ILUVIEN sales. Our fully onboarded commercial team is focused on educating and engaging the retina community, and we are ramping up peer-to-peer educational programs and field activities with updated marketing materials to enhance physician understanding of ILUVIEN and its 2 indications.

In June of last year, we began promoting ILUVIEN under the combined label for chronic NI UPS and DME. Our sales teams have been educating customers nationwide, while our market access team worked with payers to establish coverage for the new chronic NIPS indication, all 7 Medicare Administrative Contractors or MAX have now updated their policies to cover ILUVIEN for NI UPS.

Among the top 20 commercial payers, all those with ILUVIEN specific policies have updated them to reflect both DME and NI UPS indications. We also implemented initiatives to help physician practices navigate ongoing Medicare market access challenges that have persisted since January 2025.

As a reminder, patient support foundations, such as good days had limited funding in 2025, affecting their ability to assist Medicare patients with co-pay support across retina products. Our team has gained traction with leading retina practices, helping them explore pathways secure ILUVIEN for eligible patients under the Medicare Part D benefit using a specialty pharmacy, the same approach used for Cortrophin gel access. In addition, we continue to share results from our NewDay study of ILUVIEN in patients with DME and which were presented at prominent medical meetings, including most recently at the Flow Retina International Congress in December and the Hawaiian and Retina Conference in January.

With that, I'll turn the call over to Steve for the financial update. Steve?

Thanks, Chris, and good morning to everyone on the call. I'll review our fourth quarter and full year 2025 results and 2026 guidance in more detail. In 2025, we delivered on our financial commitments, generating robust top and bottom line growth and significant cash flows.

Starting on Slide 12. The ANI recorded revenues of $247.1 million in the fourth quarter, up 30% over the prior year period. For the full year 2025 ANI generated record revenues of $883.4 million, up 44% versus 2024. Revenues from Cortrophin Gel in the fourth quarter were a record $111.4 million, up 88% from the prior year period.

In 2025, Cortrophin gel delivered $347.8 million of net revenue, up 76% year-over-year driven by strong adoption across neurology, nephrology, rheumatology, pulmonology and ophthalmology. ILUVIEN net revenues were $19.8 million in the fourth quarter and $74.9 million for the full year 2025.

Revenues for generics in the fourth quarter were $100.8 million, an increase of 28% over the prior year. The outperformance for the quarter was driven by continued strength in the partner generic launch that occurred in the third quarter of 2025. Full year revenues in 2025 for generics were $384.1 million, an increase of 28% over the prior year, reflecting our strong R&D capabilities, execution and steady cadence of new product launches.

Now moving down the P&L on Slide 13. As a reminder, when I speak to our operating expenses, I will be referring to our non-GAAP expenses which are detailed in Table 3 in our press release. Generally, our non-GAAP operating expenses exclude depreciation and amortization, stock-based compensation and certain costs related to litigation and M&A activity. Please refer to Table 3 for a full reconciliation to our GAAP expenditures. Non-GAAP cost of sales increased 43% to $99.8 million in the fourth quarter of 2025 compared to the prior year period primarily due to net growth in sales volumes and significant growth of royalty-bearing products.

Non-GAAP gross margin in the fourth quarter was 59.6% and a decrease of approximately 400 basis points from the prior year period, principally due to product mix, including significant growth of royalty-bearing products, including Cortrophin and a partner generic product that was launched in the third quarter as well as lower brand revenues.

For the full year of 2025, non-GAAP cost of sales increased 44% to $339.5 million compared to the year before and non-GAAP gross margin was 61.6%, down approximately 10 basis points from the prior year.

Non-GAAP research and development expenses were $11.7 million in the fourth quarter, a decrease of 27% from the prior year period, driven by timing of rare disease and generic programs. For the full year of 2025, non-GAAP research and development expenses increased 18% to $49.5 million compared to the year before due to higher investment to support future growth of our rare disease and generics businesses.

Non-GAAP selling, general and administrative expenses increased 28% and to $70.2 million in the fourth quarter, driven by spend for our new larger ophthalmology sales team, promoting Cortrophin Gel and ILUVIEN and continued investment in rare disease sales and marketing activities including the expansion of the rare disease team in the first quarter of 2025. For the full year of 2025, non-GAAP selling, general and administrative expenses increased 46% to $264.6 million.

Adjusted non-GAAP diluted earnings per share was $2.33 for the fourth quarter compared to $1.63 per share in the prior year period. For the full year of 2025, non-GAAP diluted earnings per share was $7.89 compared to $5.20 the year before. Adjusted non-GAAP EBITDA for the fourth quarter was $65.4 million, up 31% compared to the prior year period and was $229.8 million for the full year, up 47% compared to the prior year.

We ended the fourth quarter with $285.6 million in unrestricted cash up $140.7 million as compared to the $144.9 million as of December 31 of the prior year. Cash flow from operations was $30.4 million in the fourth quarter of this year and $185.2 million on a full year basis.

As of December 31, 2025, we had $629.1 million in principal value of outstanding debt, inclusive of our senior convertible notes and term loan. At the end of the fourth quarter, our gross leverage was 2.7x and our net leverage was 1.5x our full year adjusted non-GAAP EBITDA of $229.8 million. This morning, we are pleased to reaffirm our 2026 financial guidance, which reflects significant top and bottom line growth.

Our guidance outlined on Slide 14 is as follows: 2 sorry, 2026 net revenue of $1.055 billion to $1.115 billion representing year-over-year growth of approximately 19% to 26%. Cortrophin Gel net revenue of $540 million to $575 million representing year-over-year growth of 55% to 65%, driven by continued volume gains.

Consistent with prior years and typical industry dynamics, we expect first quarter Cortrophin general revenues to be down sequentially from the fourth quarter and to represent approximately 13% to 14% of total 2026 revenues slightly lower than in 2025, when the first quarter accounted for approximately 15% of full year revenues.

This effect is driven by 2 factors: first, we are experiencing typical seasonality related to the impact of insurance reverifications, which appear to be taking slightly longer as compared to the prior year. Due to increased Cortrophin patient volume in the physician's offices and in some parts of the country due to weather-related physician office closures that temporarily delayed the reverification process.

While these factors impacted January, we have since seen a 25% jump in volumes dispensed and acceleration in new patient starts in February, and are confident that the momentum will persist in March as physician offices complete work through the reverifications backlog.

Second, our full year Cortrophin guidance is inclusive of initial script volume expected to result from our 90% organizational expansion to support our gaudy authorities flares indication. Revenues associated with this expansion will first occur in the third quarter and are expected to build momentum throughout the fourth quarter.

As we look further out into the year, we remain confident in our full year guidance and the significant multiyear growth opportunity for Cortrophin Gel. We expect very significant sequential growth in the second quarter as typical first quarter dynamic subside. We then expect further sequential gains in the third and fourth quarters, driven by continued performance of our portfolio, pulmonology and ophthalmology teams, in addition to the full deployment by the end of the second quarter, of our new 90-person organization focused on acute cadiarthritis flares.

We expect ILUVIEN net revenue of $78 million to $83 million, representing year-over-year growth of approximately 4% to 11%. We expect adjusted non-GAAP EBITDA and of $275 million to $290 million, representing year-over-year growth of approximately 20% to 26%.

And from a quarterly cadence perspective, we expect adjusted non-GAAP EBITDA to be down sequentially in the first quarter and modestly down as compared to the first quarter of prior year driven by quarterly revenue dynamics.

We then expect sequential growth in the remaining quarters of the year, with the fourth quarter representing the highest quarter by a significant amount driven by incremental contribution from our gout focused team expansion. We expect adjusted non-GAAP earnings per share between $8.83 and $9.34, representing year-over-year growth of approximately 12% to 18%.

We expect adjusted gross margin to be 59.3% to 60.3% in 2026, which is down from 2025, driven by significantly higher forecast sales of royalty-bearing products the non recurrence of revenues from our first half 2025, 180-day exclusive launch of [indiscernible] and the expectation of lower brand sales.

We currently anticipate a full year U.S. GAAP effective tax rate of approximately 26% to 28%. And consistent with prior quarters, we will tax affect our non-GAAP adjustments for computation of adjusted non-GAAP diluted earnings per share, utilizing our estimated statutory rate of 26%.

We anticipate between $21.5 million and 21.8 million shares outstanding for the purpose of calculating full year non-GAAP diluted EPS and finally, please note that we will continue to exclude from our adjusted non-GAAP diluted EPS calculation, the dilutive shares included in GAAP diluted EPS, which are expected to be offset in full by the cap call transaction.

With that, I'll turn the call back to Nikhil.

Thank you, Steve. Turning to Slide 15. In closing, we delivered a remarkable 2025 characterized by significant growth across Cortrophin Gel and outperformance in our generics business. We've entered 2026 in a position of strength and remain focused on achieving our strategic priorities, including accelerating our transformation into rare disease, continuing to execute in generics and deploying capital in a disciplined manner. .

Overall, we expect to deliver over $1 billion in revenue in 2026 with rare disease representing approximately 60% of total revenues. With that, operator, please open the line for questions.

[Operator Instructions] And we'll take our first question from the line of Glen Santangelo from Barclays.

Nikhil, obviously, Cortrophin continues to surprise on the upside, and you sort of make the case that you believe there's a multiyear opportunity here as you expand into these under-penetrated indications. And you're obviously investing in the sales force to try to take advantage of that.

Without giving us guidance beyond 2026, I don't know if there's any high-level commentary you can sort of give us -- can you help us think about how meaningful this multiyear opportunity could be.

And I am guessing you're starting to think about a peak sales number, maybe it's a little bit premature, but how do you think about that? And then my follow-up to Stephen's going to be -- the royalty steps up this year. Can you help us think about how that royalty is going to step up so we can sort of better model gross margins going forward?

Yes. Thank you for your question, Glen. Look, I think we believe in the significant multiyear growth opportunity for Cortrophin but I think the key really is Slide 9 in our deck from this morning, where we highlight the addressable patient populations across indications. .

And these are significantly underpenetrated, not just by us but across the ACTH category. So we believe that there is a much larger number of patients that are yet to -- that are appropriate for ACT therapy that are yet to benefit from this therapy. So we see a significant multiyear growth run rate for the category and also for Cortrophin.

And we're investing to build momentum in 2016 and beyond, right? So high ROI commercial initiatives like the 90% organizational expansion for gout, but we did an expansion last year. We're enhancing convenience, we launched a prefilled syringe last year.

We're continuing to evaluate opportunities to further enhance patient convenience. And importantly, we're generating both scientific and clinical evidence we advanced Phase I clinical trial. We're advancing a Phase I clinical trial for Cortrophin in gout as well as a robust pipeline of investigator-initiated trials across disease trades.

So we believe in the strong multiyear growth opportunity and are investing to ensure that we can capture that opportunity? And again, we believe in the opportunity for the category as a whole to keep growing for several years. And then your second question on the Merck royalty in 2025, annual revenues of Cortrophin Gel reached a level by which we surpassed the highest royalty tier for incremental net sales, the way in 2025 itself, we were in the highest royalty tier for the royalty.

And then we currently anticipate the blended royalty rate to be in the high 20s in 2026.

And we'll take our next question from David Amsellem with Piper Sandler.

So I had 2 on Cortrophin. So one, I'm trying to get a better sense of how you're thinking about operating leverage going forward. So you're adding the 90 reps, you're calling on primary care, you're calling on podiatrist. I'm just wondering how promotion intensive you perceive the gout indication to be and what that means for potentially further expansion.

So just help us understand that and how you're thinking about operating leverage. That's number one. And then number two, are you thinking about indications like sarcoidosis and ophthalmic indications -- can you talk about the number of vials used or duration of treatment in those kind of indications versus gout?

And what I'm trying to get at is the value of a given patient across the different opportunities within the Cortrophin franchise. So if you could help us provide color there, that would also be helpful.

Great. Thank you for your question, Dave. So the first question on operating leverage. Look, we're still in high-growth mode, and we continue to balance growth and profitability as we drive that growth, right?

So when you look at 2025, our guidance implies EBITDA growth of 20% to 26%, and the EBITDA margin as a percentage of growth -- sorry, as a percentage has stayed in the same in our 2026 versus 2025 despite a our very significant investment in this 90% organization for a graft and then also related OpEx, right?

So the total implied OpEx increase at the midpoint of our guidance is about $50 million, majority of which is for the gal expansion. And despite that, we're keeping the EBITDA margin percentage the same in '26 versus '25.

We strongly believe that as we had seen even with the expansion last year of the sales force that we will see partial impact from the organization expansion for gout in 2026, and we'll see full impact in 2027, right? So the full year impact and -- because it takes the sales force, we'll have them in place by mid-year they'll have impact in Q3 and Q4. And then you'll see full impact in 2027, obviously driving operating leverage.

So that's the question on operating leverage. And look, I think the key is in terms of further expansions, the key is the addressable patient population, right? As you know, we currently have a combined team that details into nephrology, neurology and rheumatology. That's called our portfolio team. We expanded that team in 2025, right?

We still have a much larger addressable patient population that we can address, not just in these 3 beauty areas but across areas. So with an ability to reach physicians and reach patients there would be benefit from further expansions. Obviously, but that's down the field as we capture this multiple multiyear growth opportunity.

I mean the key in terms of the current year investment we're seeing impact on this year retaining the EBITDA margin percentage and then going in 2027, we'll see a much bigger impact with the same level of SG&A this year.

Your second question was on the duration of treatment across indications. The duration of treatment does indeed vary sarcoidosis has a much longer in use and more miles per patient, whereas acute [indiscernible] flares has a lower number of vials per patient that is appropriate, right, at the time of the exacerbation or flare. So there is a variance across the nation that we serve with Cortrophin Gel. Thank you, David.

And we'll go next to Vamil Divan from Guggenheim Securities.

Great. Maybe one more on Cortrophin. I could sort of building on the earlier question. So this additional 90% organization using is dedicated to the county opportunity in targeting primary campaign. I'm just trying to get a sense of again sort of the leverage of the opportunity for them to do other things beyond just gouty arthritis will they be going to any other specialties?

Or are there other indications they'll be focusing on? Or is it strictly just for a arthritis. Just trying to get something in the ability to leverage that additional investment. And then second question, I guess, more for Steve on the business development side.

And you've talked about investing and kind of expanding the rarer disease opportunity here. I'm just trying to get a sense of given where your leverage is now. So what you're willing to do in terms of leverage versus using equity or as you think about the size of potential deals what you beat in terms of options for financing those sorts of opportunities.

Thank you, Vamil. So on the 90% organization, that's for gout. And as a clarification, not all 90 are in sales. So majority of that any person grew its sales expansion, but there are obviously patient support operations and marketing and other support areas, too. .

But yes, that organization and the sales organization and the rest of the organization can be leveraged both for other indications that they treat or primary care and purity do treat other indications that Cortrophin is indicated for, our focus is primarily on gout, but there are other indications potentially that they can treat, which [indiscernible] for the appropriate patients. but can be leveraged for that.

But in addition, that sales force can also be leveraged by adding another product in the basket just like we did for ophthalmology. So that option is available. Obviously, our -- the opportunity in acute garden arthritis flares is very significant. We've identified 7,000 HCPs, that treat the most severe acute cardio arthritis flares patients, and that is our -- that is the primary focus of this expansion, and that is what we will be -- we focused on as we put this team in place by midyear.

And look, we've made very good progress on the recruitment. We have our sales leadership and the area business directors in place and we're now moving to recruitment of the sales team members, and we will launch by midyear. So on the acute a few [indiscernible] players expansion. And then I'll turn it to Steve to answer your question on BD. Steve?

Yes, thanks for the question. We're incredibly pleased with the cash flow dynamics of the company in 2025. We're ending the year with $285 million on the balance sheet and the business generated $185 million from operations in 2025. And as you see in our full year guidance, right, we're projecting continued both revenue and profitability measures growth and so we expect very healthy cash flows in 2026 as well. .

And so at this point in time, right, given the strategic imperatives of the company to expand rare disease we anticipate accruing that cash to the balance sheet to build that war chest for future business development and M&A activities. I think what you've seen us do consistently, you can look back to when we purchase Novidium in 2021, when we purchased Alimera in 2024, right?

We take a balanced approach to how we finance these types of activities. And in terms of leverage ratio, right, we like to take a reasonably conservative approach there. I think what we've done in the past is we'll take leverage up to the 3-ish range, maybe a touch above 3% on net leverage but always with a clear line of sight in terms of organic delevering.

And if you look back, right, to the close of Alimera, we were just right around 3x net levered and here, just 5 quarters downstream, we've cut that leverage in half really driving with organic growth in the business. So I think you should expect similar moves in the future. Okay.

And we'll take our next question from Dennis Ding with Jefferies.

We have 2. So on Cortrophin, thanks for the color on Q1, it seems like the winter storms were an unexpected impact, but bad things are recovering.

So I'm wondering when you take a step back and think about the first versus second half split, it seems like it will be meaningfully second half weighted, and that does put pressure on the gout expansion going as planned. So how do you give investors confidence that will go as planned and the PCPs will be okay with prescribing a very expensive product.

And then question number 2 is specifically on gross margins. So the royalty to work, I believe, is capped around 30% so we shouldn't really get any more incremental headwinds moving forward. But how are you thinking about buying that royalty down given how much cash flows you guys are generating? And is that a priority for you? And how do you also convince Merck to come to the table?

On thank you for your questions. Dennis, look are new dedicated field force for acute [indiscernible] arthritis flares will be deployed by midyear. And are reasons to believe are, number one, the large underpenetrated market opportunity and Cortrophin is the only approved ACTH product with this indication? Second is we have a successful track record in got plus of our volumes in 2025, coming from gout in rheumatology and nephrology. .

And number three, our successful pilot programs across 10-plus territories in primary care and parity offices, which we ran in 2025, right? Would see the most severe acute [indiscernible] arthritis flares patients.

And so we saw success with those pilot programs, and that gave us the confidence to deploy this larger sales force and the large organization in an indication where we have the indication, and we are the only ACTH product available, right? So with the field force deploying the midyear, we expect to see in Q3 and Q4, like we saw in 2025 when we did the expansion for our portfolio sales force. And we'll see the full realization in 2027, right?

As we're expanding our field force, we're also investing in clinical evidence generation through a Phase IV trial to expand usage over time. That's on the gout expansion. And then your second question on the Merck royalty, look, I think we've -- in we are always evaluating potential opportunities, but we do not comment on active or nonactive business development initiatives, especially with our partners. And thank you for your question, Dennis.

And we'll move next to Ekaterina Knyazkova.

Just 1 from me. So just on Cortrophin gel, have you seen any recent changes on the patient access front, just are you seeing any payers or plans getting more triple or coverage or reimbursement? Or are you seeing kind of trends that are similar as you were seeing last year?

And thank you for your question, Ekaterina. Look, we try to find a balance between sharing information that is helpful to investors and that is competitively sensitive. .

Having said that, at an overall level, we have not seen material changes from an access perspective. again, we're targeting or we're reaching -- trying to reach the appropriate patients as a late-line therapy with Cortrophin gel but thank you for your question.

And we'll go next to Thomas Smith with Leerink Partners.

Two on Cortrophin, if I could. You mentioned about 15% of utilization came from acute gave arthritis in 25. Could you just give us a sense of what your expectations are for where that number goes in '26 and '27 given the sales force expansion efforts? .

And then could you give a little bit more color on the Cortrophin pilot programs executed in primary care and pathology. Any details I guess, on specific feedback from those prescribers versus your other specialty types and any specific learnings you're implementing to help better target those offices.

Yes. Good morning, and welcome to your first ANI conference call. Tom, great to have you. So the first question is on our current business. in gout, about 15% of our volume comes from gout. As we deploy this targeted sales force and broader organization, we do expect it to increase significantly.

We're not putting a number to it at this time, but we'll keep you updated, obviously, on our progress. I think the important thing to highlight here is that if you look at the ANI Cortrophin story, a big part of that success has been being able to reach new physicians.

Almost half of our physicians that have prescribed Cortrophin were naive to the category, [indiscernible] prior to the entry of Cortrophin gel. And if you think about -- and this dovetails into your second question around the pilot programs. If you think about the HCPs that we're reaching through this expansion, we're targeting -- we're trying to reach about 7,000 ETPs that we've identified across territories, right? Majority of these right?

Obviously, some were part of the pilot programs that we had across 10 territories, but most of these have not been. And so that will further expand, right? And the success we've had in being able to reach new physicians right will continue. It has given us that for them, and we'll continue as we reach these new primary care and podiatry care physicians, right? So what will also expand is not just the gout volumes as a percentage of Cortrophin volumes, but also the number of physicians and a number of new physicians that were naive to ACTH.

And then going back to your second question regarding -- or I guess, second part of your second question on the pilot programs. I think that we've had a lot of learnings in terms of the discussion to be had with the primary care and proprietary physicians in terms of identifying the appropriate patients, how to work with their offices right to work through the enrollment of fulfillment process?

And then also, learnings on primary care and podiatrist are very large sort of number of HCPs that are there in the country but really figuring out the 7,000 that treat the most severe acute guard arthritis flares, how do you identify them with the claims and other data that is available so that you're reaching the appropriate patients?

That's been part of our learnings through the pilot programs through 2025. And thank you for your question, Tom. .

And we'll take our next question from Les Sulewski from Truist Securities.

Congrats on the progress. Three for me, Cortrophin first, you noted that 15% of utilization is coming from gout. How would you expect that trend to uptick once the new team is in place? And is this a good representation of the percentage of the total consultant revenues? And then will you have some of the results from Phase IV trial in time for the sales force expansion?

And the second, on ILUVIEN, can you provide an update on the specialty pharmacy progress and perhaps just kind of your thoughts on the patient access? And then lastly, on generics, how are you thinking about product cadence and erosion as we move through the year.

For questions. I'll take them one by one. So the first question on the gout -- we do believe that the 15% of volume of current volumes will expand, right, as a percentage of total volumes with this investment. So we will see a significant uptake we will update you as we move along.

On the trial, we are -- the trial -- the Phase I trial is progressing, and we will provide meaningful updates as that trial progresses. If the organization expansion, right? We've already hired, as I said, the sales leadership and the ABD, they're your business directors. The organization will launch in full by midyear. The results of the trial will not be in place by then. So that's on the come later on, and we'll obviously provide updates on the trial.

The second question was on ILUVIEN. So on ILUVIEN, we continue to make progress in the growing use of the alternative access channels to navigate the market access challenges for Medicare patients. We are seeing prominent practices adopting this alternate workflow and use of alternate channels.

And it's basically patients that have access to the drug benefit. And that's the same procedure that or process that we use and workflow that we use for Cortrophin. And so we've seen prominent retina practices use it.

Now what we -- what has happened with the foundation funding is we had seen some early contributions to the funding earlier this year. And though this hasn't had a meaningful impact on patient access to ILUVIEN it was open for a few days and then it was closed back. So our guidance for 2026 does not assume that the funding will return in any meaningful way. and we will continue to closely monitor the situation and of course, stay focused on growing the use of the alternative access channels to navigate the market access challenges in addition to the strategic investments in marketing and medical affairs to support the increased awareness of the new day clinical data for DME, establishing the coverage for both DME and NI UPS and then obviously the strength in the commercial team and further enhanced promotional efforts.

So that's on ILUVIEN. And then finally, your question on the genetics cadence. We are continuing to have a strong cadence from our -- driven by our R&D capabilities of 10 to 15 launches.

That will help support growth of the generics business and cash flow generation that we are reinvesting into rare disease to accelerate the transformation of ANI into a leading rare disease company.

And thank you for your questions, Les.

And we'll take our next question from Brandon Folkes with H.C. Wainright.

Congrats on the progress. Maybe just sort of following on from the line of question on Cortrophin. Outside of gout, is it any way you can just give us some color in terms of how you're seeing the ACTH market shape up? Are prescribers choosing one product over the other or prescribers using both where they can. You talked about adding new prescribers. Can you just help us think through when you convert these new prescribers, are you generally converting them to sort of be a Cortrophin prescriber or a ACTH believer in prescriber?

And what I'm trying to get to is how competitive is the next script for a potential patient right now versus a continued market expansion. How long do you see sort of the market expansion playing out versus market expansion as well as share capture between the 2 and within the category driving growth.

Yes, thank you for your question, Brandon. So I think your first question was on the ACTH market beyond and I think that we'll just point to a couple of points. Number one is that we see growth across indications across the core indications that we launched with, which is in rheumatology, nephrology and neurology in addition to in the pub and ophthalmology. .

If you think about the ANI's growth in Cortrophin in 2025 in Cortrophin, a significant portion of that came from just growth across all these specialties outside of gout. Now gout also was a driver but there was significant growth across these other specialties too.

And then really, the thing that's underpinning and that really goes to your second question around the competitive situation. And this is, to us, not about share capture at all. This is about market expansion, reaching the appropriate patients and the addressable patient population is very significant. And highly underpenetrated, right?

So it's significantly underpenetrated across indications. And so the fact that 2 players are out there trying to address the appropriate patients ultimately supports the overall market growth and ensures that the appropriate patients get the benefit of ACTH treatment for their indications.

And then maybe the last part of your question, which was -- we are -- our team is out there trying to convince and this is a little bit on a lighter note. But our team is out there trying to convince patients -- I'm sorry, current confused physicians of the appropriate patients for Cortrophin, right, and not the broader ACTH category. So thank you for your questions, Brandon.

And I would like to now turn the call back over to Nikhil Lalwani for closing remarks.

Thank you, everybody, for taking time to join the ANI discussion. We look forward to updating you on our progress and are looking forward to a strong 2026. Thank you so much, and we will remain focused on our purpose of serving patients, improving lives.

Thank you. This brings us to the end of today's meeting. We appreciate your time and participation. You may now disconnect.

Hello, everybody. I'm Ekaterina Knyazkova from JPMorgan and pleased to be introducing ANI Pharmaceuticals. And from the company, we have Nikhil Lalwani, CEO; and Steve Carey, CFO, who will be doing a presentation, and then we will jump into Q&A. And with that, I will turn it over to Nikhil.

Good afternoon, and thank you for joining us here for a session on ANI Pharmaceuticals. These are our standard disclaimers regarding forward-looking statements, kind of the financial information that we're presenting. So I'm proud to tell you here about ANI Pharmaceuticals, a profitable, high-growth biopharmaceutical organization. that we're transforming into a leading rare disease company. As we go through the presentation, I'll tell you about how we're accelerating this transformation into a leading rare disease company.

In '26 we're projecting over $1 billion of revenue, which represents 26% growth year-on-year versus '25, a year will be delivered greater than 39% year-over-year growth. The rare disease business is our primary focus and will account for approximately 60% of total revenues. With our lead asset, purified Cortrophin Gel providing substantial durable multiyear growth opportunities. Our generics business delivered strong cash flows driven by superior R&D capabilities, operational execution and U.S. manufacturing. And what you see on the right-hand side is this creates a virtuous cycle of growth where our EBITDA and cash flows from generics and brands allows us to invest in rare disease and expanding the scope and scale of our rare disease business and are accelerating the transformation into becoming a leading rare disease company. We have a proven track record of delivering top and bottom line growth. Since 2022, we've more than tripled our revenues and more than quadrupled our adjusted non-GAAP EBITDA.

To speak a little bit about our 2025 accomplishments where we had robust expansion across the business. Our net revenues grew by more than 39% to $854 million to $873 million in revenues and our adjusted non-GAAP EBITDA grew more than 42% to $221 million to $228 million. This was driven primarily by the rare disease business, which generated greater than 84% year-over-year top line growth in our generics business, which outperformed with greater than 20% year-over-year top line growth.

As we begin 2026, our priorities to drive long-term growth and value creation are threefold: number one, to accelerate ANI's transformation into a leading rare disease company. Cortrophin Gel, our lead asset, for that asset, we will maximize the multiyear growth opportunity by addressing significant unmet need across indications. We'll build on the momentum in the underpenetrated specialty indications of nephrology, neurology, rheumatology and pulmonology. And in addition to that, we're building and deploying this year a 90-person organization dedicated to acute gouty arthritis flares by the middle of the year.

We're also advancing a Phase IV trial to establish further evidence supporting the use of Cortrophin Gel in acute gouty arthritis flares. And we will continue to evaluate opportunities to enhance patient convenience. For our second rare disease asset, ILUVIEN in '26, where we will return ILUVIEN to growth by leveraging the commercial and patient access initiatives that we began in 2025.

Priority number two, continued execution in our generics business, leveraging our superior R&D execution, our operational excellence and our U.S.-based manufacturing footprint and business development expertise to continue expanding cash generation and delivering or maintaining a current cadence of 10 to 15 launches annually.

Coming to our capital allocation, which is our third priority. We will continue to be disciplined in our capital allocation. From a balance sheet perspective, we will explore opportunities to expand the scope and scale of our rare disease business. And from a P&L or OpEx perspective, we will invest in the dedicated organization for Cortrophin Gel in gout, and we will invest high single-digit percentage of generics revenues to support the growth in generics.

When you look at our '26 guidance, it reflects strong top line and bottom line growth. Our net revenue guidance is $1.055 billion to $1.115 billion, representing 24% to 28% growth, and our adjusted non-GAAP EBITDA guidance is $275 million to $290 million, which represents 24% to 27% growth. Importantly, Cortrophin Gel net revenues of $540 million to $575 million represents 55% to 65% growth. And this is in year 5 of our launch, right? And after delivering 76% growth between '24 to '25.

To tell you a little bit more about our rare disease business. The rare disease business is the primary driver of growth. It's expanded from 0% of our sales in '21 to almost 60% of our sales in our '26 guidance. Even between -- you see the strong growth from '24 to '25, but even from '25 to '26, we're estimating a 51% growth across both Cortrophin and ILUVIEN.

Cortrophin Gel is our lead rare disease asset. It's a purified corticotropin, a late-line treatment option for patients that are struggling with certain chronic autoimmune disorders. Cortrophin is approved for multiple indications in neurology, nephrology, rheumatology, ophthalmology and pulmonology. With a strong potential for multiyear growth as the key indications are significantly underpenetrated and therefore, have significant unmet need. The ACTH market is a fast-growing market with 2 players, and it grew 45% year-over-year in '25 to about $992 million.

We have long-term sustainability in Cortrophin driven by significant barriers to genericization, both regulatory and IP. And lastly, we have multiple presentations for patient convenience. We have vials as well as a prefilled syringe.

To take a step back, the ACTH market returned to growth following the launch of Cortrophin in '21. And as you -- sorry, in '22 and what you'll see is that the -- it has been accelerating since we -- over the past 2 years. We had 27% growth in '24, and you're seeing 45% growth in '25. We believe in the strong future multiyear growth potential. And because across indications, they are significantly underpenetrated and we have a proven ability to reach new HCPs and patients. Over 50% of our clinicians that have prescribed Cortrophin were naive to ACTH and had never prescribed an ACTH drug before.

So to dimensionalize the under penetration across indications, and what this shows, this shows across 5 different therapeutic areas. But I'll start with the 4 on the right. Those are our foundational therapeutic areas, multiple sclerosis, RA, sarcoidosis and nephrotic syndrome. And you see that the number of patients that we believe are in our addressable market are significantly larger than anything that we're treating -- than the number of patients we're treating today. And then I'll double-click on acute gouty arthritis flares and walk you through how we arrived at the -- as an example, at the addressable patient population.

So there are roughly 10 million patients in the U.S. with gout, about 36% receive treatment annually, and they have 1.5 to 2 flares on average per year, but only 8% of those patients receive an injectable flare treatment. And that's the group that we consider with severe acute gouty arthritis flares as our addressable patient population. And that's 285,000 patients. As I said before, a very small portion of that is being penetrated today and creates a significant opportunity, multiyear growth opportunity for ANI.

So what are we doing? I said the word strong multiyear growth opportunity multiple times. But what is ANI doing to invest in and capture this growth opportunity? Number one, we're investing in high ROI commercial initiatives. We're building a new 90-person dedicated organization to expand our reach to patients with severe acute gouty arthritis flares and we expect to deploy this 90% organization in the middle of '26. We're generating scientific and clinical evidence. As an example, we're advancing a Phase IV clinical trial for Cortrophin in gout, and we're enhancing convenience. We launched a prefilled syringe in '25 and we continue to explore opportunities to further enhance patient convenience.

With this, with these investments, we're continuing to see very strong growth. In '26, we'll see 55% to 65% growth with Cortrophin growing to $540 million to $575 million. And what's important to emphasize is there's a significant growth runway beyond this in the overall ACTH market by growing the market, right? This is -- all of our initiatives are aimed at growing the ACTH market and capturing the underpenetrated addressable market that we had highlighted before.

So let me tell you about the gout expansion. As I've mentioned before, there are about 285,000 patients that we believe are in our addressable market. And we are expanding and creating a 90-person commercial organization to go service these patients and meet and address this unmet need. So why gout, right? Well, number one, as I said, there's a large addressable patient population, the most severe patients, 285,000. Number two, we are the only approved ACTH therapy for acute gouty arthritis flares. Our competitor does not have this indication. We have a proven track record. The gout indication generated approximately 15% of our usage in 2025 from nephrologists and rheumatologists.

In '25, we also ran 10 success -- across 10 territories, we ran pilots to explore the opportunity for expansion in primary care and podiatry, and we've had them be very successful. And that gave us further confidence to deploy this new 90-person commercial organization. We're also investing in evidence generation through the Phase IV trial to expand the use over time. We're really looking forward to this opportunity, and we'll update you as we build the team and deploy the 90-person organization in -- by the middle of the year.

Let me move to our second asset, ILUVIEN. It's a long-acting therapy, ocular therapy approved for DME and chronic NIU-PS. It's an implant -- intravitreal implant that provides continuous microdosing of fluocinolone acetonide in patients with retinal disease, 2 indications, diabetic macular edema. Again, greater than 50,000 patients in the U.S. that are not well served by anti-VEGF therapy, and we have less than 5,000 patients starts annually for DME in the U.S. with ILUVIEN. So representing a long -- a large growth opportunity. It's also true in chronic NIU-PS where that's noninfectious uveitis affecting the posterior segment of the eye, where there are greater than 75,000 patients in the U.S. that are candidates for this treatment and less than 5,000 that receive ILUVIEN annually, again, giving a long runway for growth.

In '26, we'll focus on returning ILUVIEN to growth by leveraging our established commercial and patient access initiatives. We're making new strategic investments in marketing and medical affairs to support increased awareness of the NEW DAY clinical study data, that clinical study read out in the middle of '25 and we're making investments to support the increased awareness of the study for ILUVIEN in DME.

We're also strengthening the commercial team and further enhance promotional efforts with a ramped-up peer-to-peer education program, new promotional materials and a strengthened commercial team. And we're growing the use of alternative access channels to navigate the market access challenges that Medicare patients faced in '25.

Next, we move to our generics business. Our generics business drives strong cash flow generation. It's a high-performing business with superior R&D capabilities, 3 U.S.-based manufacturing facilities and operational excellence. We have a robust pipeline in place to deliver 10 to 15 new product launches annually. We invest high single-digit percentage of generic sales in R&D for generics. We have a strong operational backbone. We manufacture and supply over 2.5 billion doses of therapeutics. That's what we did in the last 12 months to patients in the U.S. And as you can see, we've consistently delivered very strong growth. And in '25, we delivered low 20% -- our growth was in the low 20s.

Over 90% of ANI's revenues comes from finished goods that are manufactured in the U.S. with only 5% -- approximately 5% of revenues having a direct reliance on China. And as I mentioned before, we have 3 manufacturing facilities in the U.S., all with a strong GMP track record, 2 in Baudette, Minnesota and 1 in East Windsor, New Jersey.

So in summary, ANI is well positioned to deliver strong long-term growth and value creation. Our 2026 strategic priorities are to accelerate the transformation into making ANI a leading rare disease company, continued excellence in generics, R&D and operations and executing a disciplined capital allocation strategy. We have a virtuous cycle of growth that drives the transformation of ANI with rare disease account expected to present approximately 60% of total revenues in 2026 with our lead asset Cortrophin growing 60% year-over-year in '26 with substantial multiyear growth opportunity ahead and a strong generics business that's generating cash flows that we're reinvesting to expand ANI's rare disease business.

And from a financial strength perspective, we're over $1 billion in revenues, $275 million to $290 million in adjusted non-GAAP EBITDA. We'll have approximately $285 million in cash on the balance sheet as of 12/31 and less than 1.7 turns of net leverage. So that's ANI in summary, and with that, I'll ask Ekaterina to ask any questions.

Yes. Sure. And I guess, let me start with the 2026 outlook you provided. Just talk about some of the pushes and pulls as you think about the business?

Yes. So thank you, Ekaterina, for the question. In 2026, we will exceed $1 billion in revenue for the first time with rare disease accounting for more than 60% of the revenues. Our lead asset, Cortrophin will see strong growth, delivering 55% to 65% growth. And that growth will come from the existing indications or core indications that we're in rheumatology, nephrology, neurology, pulmonology and ophthalmology as well as the expansion into gout, where we're launching a 90-person team to drive the growth in launch -- sorry, to drive the growth in gout, specifically within primary care and podiatry.

And then as we think of profitability, you will see that we maintain profitability in '26 from an EBITDA margin level despite investing over $50 million in this expansion for gout with incremental OpEx. Yes.

And then on Cortrophin just specifically, I mean, 60% is a very nice number, and I think more than, I think, most people were expecting. Just main drivers of this? And how should we think about maybe quarterly gating or just anything else you keep in mind for that product for future?

Sure. Yes, we'll address the quarterly cadence when we get to the 4Q earnings, but in terms of where will this growth come from? We did an expansion of our commercial team in 2025, and we saw some impact from that in 2025 itself, but the majority of -- or we will get the full year impact and additional impact from that expansion in '26. So a good portion of the growth from '25 to '26 will come from the expansion that was done in '25. And in '26 -- and then additional growth will come from the setting up of the team to pursue acute gouty arthritis flares in primary care and podiatry, but that team will deploy midyear. So it will start delivering towards the back half of the year, and will have a full scale impact in '27 and '28. So we will get operating leverage on the investments in that -- in this expansion as we move forward. Yes.

No, that makes sense. And then just looking back -- earlier question, but looking back to '25, if you think about both Cortrophin Gel and Acthar and growth really stepped up. Just looking back, how much of that was the introduction of the prefilled in the pen. How much of that was maybe some kind of more reps representing both products and some of the Part D changes. Just talk about the mix of what do you think cost the entire market to step up?

Sure. Yes. Look, it's really the patient population. There is a real unmet need here. ACTH is used as a late-line treatment for patients for whom other therapeutics are not working who are refractory or have high side effects with other therapeutics. And so it's a late line treatment option. And really what's driven the growth is the unmet medical need and the patient populations as we've shown across indications that can benefit from ACTH therapy. That's the primary driver of the growth. And then -- and it's really, again, from our perspective, this is really about market growth. And with both companies creating increased awareness of the ACTH category, both -- with clinicians and patients are benefiting from the efforts of both companies.

You asked about the prefilled syringe. I think the prefilled syringe has taken on a much more widespread adoption than we had originally planned. Initially, we thought that the prefilled syringe was intended for patients with dexterity issues or visual impairment, but we've seen more widespread adoption. We've talked about 70% of our enrollments in Q3 were for the prefilled syringe and that momentum continues. But that's a presentation choice. The underlying growth is driven by the patient need.

And then you talked about IRA. We've seen a moderate positive impact from IRA. I believe the competitor has seen a tailwind from IR. So I think those are the drivers of growth. But again, main driver for Cortrophin -- for ACTH market and Cortrophin growth in '25 was the underlying unmet need and patient demand, and that will persist and that's what gives the runway for growth for the ACTH market and for Cortrophin.

And would you say there's like any 2 to 3 indications that are kind of driving most of it? Or is it like broad-based kind of across indications?

Yes. Really, it's broad-based across indications. We saw growth in '25 across the core indications. When we launched in '22, we focused on neurology, nephrology and rheumatology and then over time, we've expanded into ophthalmology and pulmonology. And we really -- if you call these are foundational indications, we see growth across all of these indications. We see growth in existing prescribers and new prescribers. We've talked about 50% of our prescribers are folks that were naive to ACTH.

So that's enabled us to reach newer patient populations. And gout right, has grown to be, it's an indication that only we have. It's growing to be about 15% of our volume. A lot of that volume in '25 came from specialists such as rheumatologists and nephrologists. And then we had the pilots that we did in 10 territories, which drove some growth, but again, small -- at a small level, now we're really going after that opportunity with the team expansion. Yes.

And going back to kind of like the broader class. Obviously, we've seen a lot of growth. I think we're actually approaching the previous $1.2 billion peak. Just how big do you think this class can become over time, $2 billion, $2.5 billion, $3 billion?

Yes. We're not giving multiyear guidance today. I think that -- I think what I can say is we do not see -- we see significant growth opportunity for the category, driven by the patient demand and the unmet need. And getting to $2 billion, $2.5 billion or double of where the previous peak was, we don't see significant barriers to the market growing there. And really, the conversations internally are just about expanding the patient pools that we're reaching, as seen by our investment in growing the market. So this is all about market growth for us.

And then talk a little bit about the data generation angle. Just as you think about Cortrophin Gel, I know you're doing a study in acute gout. Are there any other indications where you think doing some Phase IV might make sense?

Yes, so we're -- since we've launched, we've actually been generating data of clinical -- sorry, data of 2 types. First is preclinical data, which supports the differentiated mechanism of action, the nonsteroidal mechanism of action of Cortrophin and that's been support -- been helping, and we're doing this across indications and supporting the clinicians and their decisions on where to use Cortrophin. And then more recently, we've launched the Phase IV study for acute gouty arthritis flares with Dr. Hyon Choi in Mass General, and we believe that, that will generate additional data to support the use of Cortrophin in acute gouty arthritis and potentially adopted into the ACR treatment guidelines.

And then your decision to kind of invest in the dedicated gout sales force. You talked about this, but maybe you can just elaborate what type of positions you're going to be targeting? And how will this fit into your existing infrastructure?

Sure. So as we -- as I said, we -- there was about 15% of our volume that comes -- it came in '25 from acute gouty arthritis. But that really came from specialists, really rheumatologists and nephrologists. And as we were exploring how do we serve more patients, capture more of these 285,000 patients that are in our addressable market. What we realized is there is this trend of patients going more to internal medicine and podiatrists because it's tough to get to specialists or it's increasingly harder to get appointments with specialists. And so we ran this pilot in 10 territories where we asked our teams to pursue these 2, internal medicine and podiatrists.

And we found that there is a subset of internal medicine or primary care and podiatrist that serve more patients with severe acute gouty arthritis. And so we've identified about 7,000 targets, physicians that treat more patients that -- from acute -- sorry, that suffer from severe flares. And our team is aimed at, that we're building, is aimed at reaching these prescribers and therefore, accessing the broader patient population.

And then just one last question, if I may, on Cortrophin Gel. Just competition, anything on the horizon out there that you're kind of watching? Or is there some sort of kind of generics pathway or just anything you're kind of thinking about there?

Sure, we believe this category and both the ACTH.

Category, both products are very tough to genericize. They're naturally made. It's a complex formulation. There have been efforts made to genericize. So there are both regulatory as well as IP challenges. Both companies have IP that go into the 2040s, multiple Orange Book-listed patents. And we're also continuing to monitor alternate pathways that companies may be pursuing. Obviously, as the category keeps getting bigger and more people become informed about the unmet need, there may be more interest into the category, but we do not see anything on the horizon.

And switching gears to the ophthalmology business. Obviously, if you think about YUTIQ ILUVIEN, 2025 was a bit of a challenging year, not just for those products for I think a few others. But just elaborate a bit on what you're expecting '26 6 specifically what you're kind of factoring in for the foundation level funding and just anything else you kind of keep in mind as we think about the recovery of that franchise?

Sure. So we -- our initiatives for ILUVIEN really started in '25 as we call that a reset year for ILUVIEN. And those initiatives have taken shape. We have a stronger commercial team in place. We have a ramped-up peer-to-peer education program with new promotional materials that will start rolling out in '26. We are spending additional time in bringing the -- and in strategic investments to bring the results of the NEW DAY Clinical Study in DME for ILUVIEN to a broader set of clinicians. And all of these initiatives, along with the alternative access pathways for patients that have the co-pay challenges in Medicare will help us return ILUVIEN to growth.

It is a key priority of us in '26 to return ILUVIEN to growth. And as you can see in the Q4 results and we're starting to see that traction, and we will look to build on that as we move forward in 2026. As far as our guidance for '26 goes, it assumes no return to funding for the -- for foundations that support co-pay for Medicare.

And I just feel that, that funding issue, I mean, it's having such a big impact on the market. Is there anything you can do to kind of address it or there's some ways to kind of go around it? Just anything -- because I know that piece of it is outside of your control, but is there anything you can just kind of avoid the issue, I guess?

Sure. So the -- we are exploring alternate access pathways. So there are patients -- the patients that are impacted here are patients with Medicare Part B. But some of those patients also have Medicare Part D. So they have the drug benefit. And when they have the drug benefit, we work with the physician offices, and we've been doing this since early '25 when the funding issue -- the foundation funding issue initiated. And what we found is that there are offices that are willing to explore this alternative pathway. There is additional workflow needed for this pathway, but there are offices that are willing to explore that. And we see an increasing use of that. In terms of getting the foundation funding at the level that is needed to support the patients. I think that, that is probably -- there are probably more zeros required there than anything ANI Pharmaceuticals can help with.

Fair enough and then just as you think about taking a step back, has your peak sales kind of potential for this franchise changed at all? Is this kind of more just like near-term kind of issues or how you're thinking kind of changed about the longer-term opportunity here?

No, absolutely not. I think that both in DME and NIU-PS, there are patients that can benefit from this treatment. In noninfectious uveitis, steroids are the standard of care and there's less than 5,000 patients being treated with, and we believe there's about 75,000 patients that could be in the addressable market. And then in DME, there are less than -- there are 53,000 patients roughly that have shown suboptimal response to anti-VEGF and show positive response to steroid trial. That's the addressable market. And again, we're scratching the surface with less than 5,000 patients being treated. So no change in our opinion on the larger opportunity, yes.

And then switching gears again to generics, you're obviously lapping some major launches in '25. What should we expect on 26? And do you think you have enough in the pipeline to kind of offset, I think, Motegrity and also the partnered launch that you had in Q3?

Yes. So generics has been a strong cash flow generator for us. We invest high single-digit percentage of generic sales into R&D, and we will continue doing that. And it will give us a -- maintain the current cadence of our 10 to 15 launches annually. When you come into '26 guidance, we believe with the very strong year that we had in '25, where we delivered low 20% growth. And over the long term, as investors will know, we talk about delivering high single digit, low double-digit growth in generics.

So in '25, we really delivered a 2-year growth, right? And so in '26 the numbers will -- and we'll speak more about this as we get to the Q4 earnings, the generics will largely be flattish versus the '25 number, but our current cadence of launches will continue. We believe that in high confidence in the superior R&D capabilities and the same R&D capabilities that got us Prucalopride, will continue delivering for us in our generics business.

And actually, that was going to be my next question. Is this kind of -- how sustainable is this kind of cadence of launches? Is this kind of like a pocket of like a lot of launches and then it kind of tapers off? Or do you think that you can kind of keep doing the 10% to 15% kind of...

No, I think it's -- in generics and for ANI, the cadence of new product launches is critical. We will continue to invest high single-digit percentage of sales in generics R&D to maintain this cadence of launches and to continue supporting the growth. And over the -- beyond '26, we continue to see the high single-digit, low double-digit growth. And I mean, just for reference point, we've doubled our generics business in the last 4 years. So we've delivered -- even though we orient to high single-digit, low double-digit growth, we've actually delivered much higher growth rate compared to that.

Yes. And then in the last few minutes, I don't want to talk about margins for a little bit. How do you see margins evolving beyond '26. Cortrophin Gel is obviously growing coming in at higher gross margins. Just how much of the upside do you think flows through versus kind of gets reinvested in the business?

Sure. So we -- ANI is very committed to driving growth and balancing that with profitability. So when you look at '26 as an example, right, at the gross margin level, our gross margins are down a little bit from '25. Our guidance was 61% to 62% versus that in '26, our guidance is 59.3% to 60.3%. But if you look at the bottom line, right, even in a year where we're investing in this -- investing about $50 million for this expansion of the Cortrophin gout organization, we're still maintaining an EBITDA percentage of 26%. And so managing the bottom line and bottom line percentage is really important.

And as you look forward from '26, remember, I said that this organization that we're investing in, the real impact is going to come in '27. So we're making the investment and we'll get the operating leverage that will drive EBITDA margin expansion in the subsequent years.

So that's really important. And just coming back to the gross margin, just to make sure I address that. The year-over-year change is really driven by three things. Number one is, we had the Prucalopride launch, which was a 180-day exclusivity, a generic launch that really had brand type gross margins to it. Second was we had brands upside in '25 that will at least are not factored in the current guidance. And then third, for Cortrophin, the royalty that we -- that is due to Merck on that is increasing in '26 from low 20s in '25 to high 20s in '26. And so that -- if you take those 3 things into account, that's what's driving the shift. But again, very importantly, the EBITDA percentage, which is what drops to the bottom line, we've maintained that in an investment year. That's not to be lost.

In an investment year where we're putting $50 million, we're maintaining the bottom line percentage. And when you look at EBITDA growth, right? The top line growth is 24% to 27% -- 24% to 28%. The EBITDA growth is 24% to 27%. So we're ensuring that as we grow, we're balancing profitability.

And then just business development, current appetite, what kind of assets are you interested in just in terms of development risk, if you're willing to take on any of that and just scale? Just talk about priorities there.

So from a capital allocation perspective, balance sheet investments will go towards rare disease to expand scope and scale of our rare disease business. We believe that the next acquisition will likely be a commercial asset or one that is -- that does not have clinical risk to it. We may adopt some regulatory risk, but unlikely we'll adopt something with clinical risk. And look, we have the benefit of two sets of opportunities, one with call points into different indications that gives us a broader aperture, but also a very strong backbone, rare disease backbone across medical affairs, patient support, market access that can also be leveraged even if there's not call point synergy. But that's the types of assets that we'll be looking to. Yes.

And just as you think about capital allocation going forward, you're generating a lot of cash flow, just priorities as you think about the mix between like BD, maybe share repo or anything else you're kind of considering?

Steve.

Yes. We're quite pleased with the cash flow generation in 2025. We generated $140 million of net cash, bringing our cash balance to $285 million at year-end. We were net levered 1.7x as of September, and you'll expect that we'll be delevering a touch off that point when we report full results in February. We expect to allocate our cash and capital to expanding the rare disease business and we expect very healthy cash flows in 2026. And at this point, continue to accrue that cash to the balance sheet to support the future BD and M&A aspirations on the rare disease side of the business.

Perfect. And I think we're right about time. So thank you so much.

Thank you. Thank you, everybody.

Good morning, everyone, and welcome to today's ANI Pharmaceuticals Third Quarter 2025 Earnings Results Call. Please note, this call is being recorded. [Operator Instructions] It is now my pleasure to turn the conference over to Ms. Courtney Mogerley, Investor Relations. Please go ahead, ma'am.

Thank you, operator. Welcome to ANI Pharmaceuticals Q3 2025 Earnings Results Call. This is Courtney Mogerley, Investor Relations for ANI. With me on today's call are Nikhil Lalwani, President and Chief Executive Officer; Stephen Carey, Chief Financial Officer; and Chris Mutz, Senior Vice President and Head of ANI's Rare Disease Business. You can also access the webcast of this call through the Investors section of the ANI website at anipharmaceuticals.com.

Before we get started, I would like to remind everyone that any statements made on today's conference call that express a belief, expectation, projection, forecast, anticipation or intent regarding future events and the company's future performance may be considered forward-looking statements as defined by the Private Securities Litigation Reform Act. These forward-looking statements are based on information available to ANI Pharmaceuticals management as of today and involve risks and uncertainties, including those noted in our press release issued this morning and our filings with the SEC. Such forward-looking statements are not guarantees of future performance. Actual results may differ materially from those projected in the forward-looking statements. ANI specifically disclaims any intent or obligation to update these forward-looking statements, except as required by law.

The archived webcast will be available for 30 days on our website, anipharmaceuticals.com. For the benefit of those who may be listening to the replay or archived webcast, this call was held and recorded on November 7, 2025. Since then, ANI may have made announcements related to the topics discussed, so please reference the company's most recent press releases and SEC filings.

And with that, I will turn the call over to Nikhil Lalwani.

Thank you, Courtney. Good morning, everyone, and thank you for joining us. The third quarter was another remarkable quarter for ANI Pharmaceuticals, marked by record revenue, adjusted EBITDA and adjusted EPS, all driven by continued momentum across our Rare Disease and Generics business units. We grew total company revenues by 54% year-over-year and 46% on an organic basis. In addition, we nearly doubled Cortrophin Gel net revenue compared to the third quarter of 2024 and generated adjusted EBITDA growth of 70% year-over-year.

Based on our very strong third quarter performance and future outlook, we are pleased to raise our top and bottom line 2025 financial guidance. Compared to 2024, we now expect to grow 2025 net revenues 39% to 42% and 34% to 37% on an organic basis, with Rare Disease becoming essentially half of our total revenues for the year. We expect our lead Rare Disease asset, Cortrophin Gel, to grow 75% to 78% year-over-year to generate revenues of $347 million to $352 million. We expect to grow adjusted EBITDA between 42% and 46% compared to 2024. Later in the call, Steve will provide more detail on our increased guidance. Growing our Rare Disease business is a top strategic priority for us, creating long-term value for our stakeholders and advancing our purpose of serving patients, improving lives.

Turning to our lead Rare Disease asset, Cortrophin Gel. To drive strong multiyear growth, we are focused on clinical evidence generation to support physician decision-making, investments to enhance patient convenience and high ROI commercial efforts to drive growth. Our team has made significant progress on these initiatives to grow Cortrophin Gel across our target specialties.

In the first quarter, we expanded our portfolio of sales team, and we're seeing very positive results, highlighted by our strong momentum in new cases initiated and growth in new patient starts. We also launched the prefilled syringe in the second quarter, reducing administration steps for patients. We're seeing sizable increased demand for the prefilled syringe and expect it to be an important growth driver. Importantly, to support our commercial team's efforts to drive awareness for Cortrophin Gel, we are committed to generating data to help clinicians, patients and payers make informed treatment decisions, including a Phase IV clinical trial in acute gouty arthritis flares preclinical data on Cortrophin Gel's mechanism of action across multiple disease states and presentations and publications at prominent medical meetings.

We remain confident in the strong multiyear growth trajectory of Cortrophin based on ACTH market has returned to growth following the launch of Cortrophin in 2022 and is expected to increase approximately 40% to [indiscernible] with Cortrophin growing by 75% to 78%.

Despite this growth, we believe that the addressable patient populations across key indications are significantly underpenetrated. For example, the addressable patient population for acute gouty arthritis alone is 285,000 patients, an indication that is unique to Cortrophin Gel's label. Importantly, the number of Cortrophin Gel prescribers who were previously naive to ACTH represent approximately half of our total prescriber base, and this group continues to grow.

Turning now to our Retina portfolio. ILUVIEN sales in the third quarter were lower due to the further impact from the continued reduced access for Medicare patients and the utilization of the remaining YUTIQ units at physician offices. In addition, adoption of ILUVIEN for NIU-PS began in the third quarter, and the company continued to make tangible progress towards full adoption of the label transition.

We see 2025 as a reset year for ILUVIEN and believe that we can grow in 2026 and beyond for several reasons. First, we believe the addressable patient populations for ILUVIEN in both DME and NIU-PS are at least 10x the current number of patients treated with ILUVIEN.

Second, we expect to see the ensuing results of our strengthened and more experienced ophthalmology organization that is coalescing and deploying an expanded peer-to-peer education program, speaker education program and new marketing initiatives. In addition, we continue to disseminate and contextualize findings of the NEW DAY clinical study and create greater awareness on the potential use of ILUVIEN.

Lastly, we are seeing signs that there is a growing number of physician offices exploring alternative access pathways, including Medicare Part D through specialty pharmacy. This is the path we use for Cortrophin.

Moving now to our Generics business. We had a very strong third quarter performance due to an opportunistic partner generic launch that occurred in the second half of the third quarter. This launch once again highlights our strength in creativity, R&D, business development, operations and execution intrinsic to ANI's Generics business, and we will continue to leverage these strengths to unlock future opportunities. Based upon upside from this launch, we expect Generics growth for the full year in the low 20% range. We're proud of the continued execution of our Generics business and how it provides ongoing foundational support that enables us to invest in our initiatives to grow our Rare Disease business.

In summary, we delivered another record quarter, driven by strong performance across our Rare Disease and Generics business. As we head into 2026, we expect our virtuous cycle of growth to persist. Rare Disease is our primary focus area and largest driver of growth. We expect continued strong momentum in Cortrophin and positive impact from multiple initiatives outlined to grow ILUVIEN in 2026. In addition, we will continue to explore inorganic opportunities to expand the scope and scale of our Rare Disease business. These efforts will be supported by continued performance in our Generics and Brands business.

I'll now turn the call over to Chris Mutz to discuss our Rare Disease business in more detail. Chris?

Thank you, Nikhil, and good morning, everyone. Echoing Nikhil, our Rare Disease team delivered another excellent quarter marked by continuing record demand for Cortrophin Gel. The number of cases initiated and new patient starts reached another record high, and we saw broad-based growth across all of our targeted specialties, rheumatology, nephrology, neurology, pulmonology and ophthalmology.

To capture the multiyear growth opportunity for Cortrophin Gel, we are focused on 3 key priorities. First, we are investing in high ROI commercial initiatives to fuel growth. In the first quarter of 2025, we expanded our portfolio of sales force by approximately 1/3, further optimizing their territories. Our expanded portfolio sales team added new prescribers and drove meaningful increases in new patient starts across our core specialties during the third quarter. In addition, our specialty-focused teams produced sizable growth in our newer areas of pulmonology and ophthalmology, and we believe we are still in the early stages of penetrating these therapeutic areas.

Cortrophin Gel prescribing for acute gouty arthritis flares remained a key driver in the third quarter. Notably, the acute gouty arthritis indication is unique to Cortrophin Gel's label among ACTH therapies and accounts for over 15% of Cortrophin Gel use. Further, the gout indication has contributed significantly to the growth of new prescribers, many of whom are historically unfamiliar with ACTH.

Turning to ophthalmology. We continue to realize meaningful revenue synergies and saw a record number of new patient starts and a 42% sequential quarterly increase in Cortrophin volumes. We believe there is further growth potential to expand awareness of Cortrophin for patients with severe allergic and inflammatory eye conditions.

Additionally, we continue to strive to enhance patient convenience. Our new Cortrophin prefilled syringe offering, which we launched in April, provides a simplified administration that we believe has been well received by patients and prescribers. The prefilled syringe continues to be an important growth driver for Cortrophin Gel.

And finally, we are investing in clinical evidence generation to support physician decision-making. As previously announced, we're conducting a Phase IV trial in acute gouty arthritis flares. We believe the 150-patient study will provide physicians with valuable insight on the treatment of acute gouty arthritis flares with Cortrophin Gel and could support positioning and treatment guidelines.

We continue to generate robust preclinical data for our key stakeholders on Cortrophin's differentiated mechanism of action across multiple disease states. This is an important growth initiative as we believe increasing the body of evidence supporting Cortrophin Gel's use across indications will help physicians make further informed treatment decisions.

Our preclinical study of Cortrophin Gel in uveitis that was presented earlier this year has been published in ocular immunology and inflammation. We also had a poster at the American College of Rheumatology 2025 Annual Meeting that highlighted preclinical data supporting the use of Cortrophin Gel for the treatment of inflammatory arthritis and its anti-inflammatory mechanism of action.

Additionally, a manuscript for a preclinical study of Cortrophin Gel in membranous nephropathy was accepted for publication in molecular therapy. The study demonstrates the steroid-independent mechanism of action of Cortrophin Gel in an animal model of membranous nephropathy, specifically its effect on the complement system, areas of significant interest in ongoing membranous nephropathy drug development. Subsequently, this publication was highlighted in a commentary paper in molecular therapy and presented at the American Society of Nephrology meeting.

Turning to our Retina franchise. We are making progress on multiple initiatives to improve ILUVIEN sales. Our commercial team is fully hired, onboarded and dedicated to educating and supporting the Retina community. We are strengthening our promotional efforts, including a ramp-up of new peer-to-peer educational speaker programs and the continued execution in the field with new marketing materials to increase the understanding of Retina physicians of ILUVIEN and its 2 indications.

In mid-June, we began promoting ILUVIEN under the combined label for chronic NIU-PS and DME. Our sales teams are educating customers across the country, and our market access team has worked with payers to establish coverage for ILUVIENs new chronic NIU-PS indication. 6 of the 7 Medicare administrative contractors, or MACs, have updated their policy to cover ILUVIEN for NIUPS, and we are working with the other contractors they update their policy. Among the top 20 commercial payers, all payers who have a policy specific to ILUVIEN have updated to reflect both DME and NIU-PS indications. We continue to receive positive clinician feedback on the convenience of a single product covering both indications.

Next, we have initiatives in place to help physician practices navigate the market access challenges for Medicare patients that have persisted since January 2025. As a reminder, patient support foundations such as Good Days did not receive sufficient funding for 2025, which affected their ability to assist Medicare patients with co-pay support across Retina products broadly. Our team has been gaining traction with HCPs with leading Retina practices exploring the pathway to get ILUVIEN accepted for appropriate eligible patients through Medicare Part D benefit using a specialty pharmacy. This is the same approach used for access to Cortrophin.

In addition, -- we continue to present the results of our NEW DAY study of ILUVIEN in patients with DME at numerous prominent medical meetings. This includes a late-breaking oral presentation at the American Academy of Ophthalmology 2025 meeting, a presentation at the American Society of Retina Specialists Annual Meeting and an oral presentation at the EU Retina Innovation Spotlight 2025 meeting. Looking forward, we are preparing to present these data at additional upcoming conferences to further disseminate and contextualize these findings.

With that, I'll turn the call over to Steve for the financial update. Steve?

Thanks, Chris, and good morning to everyone on the call. Today, I'll review our third quarter results and our revised guidance in more detail. We delivered strong top and bottom line growth, generated significant cash flows and are raising our 2025 financial guidance based on our exceptional performance this quarter.

ANI generated revenues of $227.8 million in the third quarter, up 53.6% over the prior year period. Revenues from Rare Disease and Brands were $129.1 million in the third quarter, nearly double the prior year period on an as-reported basis and up 82.2% on an organic basis, driven by growth in our Rare Disease franchise.

Rare Disease revenues were $118.5 million, up 109.9% from the prior year. Revenues from Cortrophin Gel were $101.9 million, up 93.8% from the prior year period, driven by increased volume on a record number of new patient starts. ILUVIEN net revenues were $16.6 million. Revenues for Brands were $10.7 million in the third quarter, up 16.1% versus the prior year period due to an increase in demand for certain products.

On a sequential basis, revenues were down $2.5 million as we saw the expected trend towards normalization in demand during the quarter. We expect that the normalization trend will continue and therefore, expect modestly lower demand in the fourth quarter.

Revenues for our Generics and Other segment were $98.7 million, an increase of 19.3% over the prior year period. Revenues for Generics were $94.4 million over the prior year period, driven by the successful launch of a partnered generic product in the second half of the third quarter that overcame our previous expectation for a sequential dip in Generics. Generics were up $4.1 million as compared to second quarter of 2025 due to the strength of this launch. Note that the gross margin for this partner generic product is lower than typical gross margin for our Generics portfolio given the profit share element with our partner.

Now moving down the P&L. As a reminder, when I speak to operating expenses, I will be referring to our non-GAAP expenses, which are detailed in Table 3 of our press release. Generally, our non-GAAP operating expenses exclude depreciation and amortization, stock-based compensation, certain costs related to litigation and M&A activity as well as certain noncash charges. Please refer to Table 3 for a reconciliation to our GAAP expenditures.

Non-GAAP cost of sales increased 56% to $92.9 million in the third quarter of 2025 compared to the prior year period, primarily due to net growth in sales volumes and significant growth of royalty-bearing products.

Non-GAAP gross margin was 59.2%, a decrease of 63 basis points from the prior year period, principally due to product mix, including the lower gross margins on our partnered generic product.

Non-GAAP research and development expenses were $11.8 million in the third quarter, an increase of 36% from the prior year period, driven by higher investment to support future growth of our Rare Disease and Generics businesses.

Non-GAAP selling, general and administrative expenses increased 41.1% to $63.6 million in the third quarter, driven by spend for our new larger ophthalmology sales team promoting Cortrophin Gel and ILUVIEN and continued investment in Rare Disease sales and marketing activities, including the expansion of the Rare Disease team in the first quarter.

Adjusted non-GAAP diluted earnings per share was $2.04 for the third quarter compared to $1.34 per share in the prior year period. Adjusted non-GAAP EBITDA for the third quarter was $59.6 million, up 69.8% compared to the prior year period. We ended the third quarter with $262.6 million in unrestricted cash, up from $217.8 million at the end of the second quarter and $144.9 million as of December 31 of the prior year.

Cash flow from operations was $44.1 million in the third quarter of this year and $154.9 million on a 9-month year-to-date basis. As of September 30, we had $633.1 million in principal value of outstanding debt, inclusive of our senior convertible notes and term loan. At the end of the third quarter, our gross leverage was 3x, and our net leverage was 1.7x our trailing 12-month adjusted non-GAAP EBITDA of $214.5 million.

During the third quarter, we concluded our 2021 PIPE financing transaction with Ampersand by converting all previously issued 25,000 shares of Series A convertible preferred stock to 602,900 shares of common stock. As of September 30, 2025, balance sheet, there were no further shares of Series A convertible preferred outstanding and all mandatory dividends were paid in full.

Now turning to our updated 2025 financial guidance. We are raising our guidance for total revenue, adjusted non-GAAP EBITDA and adjusted non-GAAP EPS based upon higher estimates for Cortrophin Gel net revenue and the continued outperformance of our Generics business, while tempering our ILUVIEN estimates. Our updated guidance is as follows: Full year 2025 net revenue of $854 million to $873 million, up from our prior guidance of $818 million to $843 million, representing year-over-year growth of approximately 39% to 42%. Cortrophin Gel net revenue of $347 million to $352 million, up from our prior guidance of $322 million to $329 million, representing year-over-year growth of 75% to 78%, driven by continued volume gains.

We continue to expect sequential growth of Cortrophin revenues in the fourth quarter. Combined ILUVIEN and YUTIQ net revenue of $73 million to $77 million versus our prior guidance of $87 million to $93 million. This guidance assumes no meaningful change in the co-pay funding gaps facing Medicare patients in Retina for the remainder of the year.

Generics revenue growth in the low 20% range, driven by strong contribution from new product launches. We expect Generics revenue in the fourth quarter to be down on a sequential basis due to competitive entrants into the market in which our third quarter partnered product competes in.

Adjusted non-GAAP EBITDA of $221 million to $228 million, up from our prior guidance of $213 million to $223 million, representing year-over-year growth of approximately 42% to 46%. Adjusted non-GAAP earnings per share between $7.37 and $7.64, up from our prior guidance of $6.98 and $7.35. We are revising our full fiscal year guidance for adjusted gross margin to 61% to 62% compared to our previous guidance of 63% to 64%, driven by the revised revenue mix in this morning's guidance with lower ILUVIEN and higher Generics forecast as compared to our previously issued guidance.

We currently anticipate a full year U.S. GAAP effective tax rate of approximately 21% to 22%. And consistent with prior quarters, we will tax effect non-GAAP adjustments for computation of adjusted non-GAAP diluted earnings per share using our estimated statutory rate of 26%. We now anticipate between 20.5 million and 20.7 million shares outstanding for the purpose of calculating full year non-GAAP diluted EPS.

Please note that in periods in which ANI common share price is greater than the conversion price of our underlying convertible debt of $74.11 and lower than the conversion price of our corresponding capped call transaction of $114.02 per share, we will exclude from our adjusted non-GAAP diluted EPS calculation, the dilutive shares included in the GAAP diluted EPS calculation, which are expected to be offset in full by the capped call transaction. The third quarter was the first reporting period in which this condition exists.

With that, I'll turn the call back to Nikhil.

Thank you, Steve. In closing, we made exceptional progress as we continue to execute on our strategic priorities. Rare Disease remains our top strategic area and primary driver of growth, and we'll focus our efforts on driving further growth in Cortrophin and improving ILUIVEN performance.

We are encouraged by our performance this quarter, having reached more patients with our portfolio of high-quality medicines, nearly doubling Cortrophin Gel net revenues compared to the third quarter of '24 and significantly growing both the top and bottom line, made possible by the efforts of our employees, customers, suppliers and investors and their dedication to our mission of serving patients, improving lives.

Operator, please open the line for questions.

[Operator Instructions] We'll go first this morning to Dennis ding of Jefferies.

One on Cortrophin. So Medicare Part D redesign lowered the catastrophic coverage limit this year, and that's been a big tailwind. But that also makes for a really tough comp next year where growth should be driven more organically and through expanding the breadth of prescribers. Do you agree with that take? And I guess, how much confidence do you have that you're able to do that with the sales force you have currently?

Thank you, Dennis. So I think I'll take your questions in 2 parts. First is what's the impact of IRA on 2025 and then how do we see this going forward? So I think, as you pointed out, IRA improves affordability and access for appropriate patients to needed medicines by capping the co-pays at $2,000 as well as introducing the ability to evenly spread the payments throughout the year.

Now we did see a modest tailwind from that. This is consistent with what we've said in the prior quarter. And the reason it's modest is while this did get additional patients on therapy, it was tempered by the mandatory Medicare manufacturer payments that we need to make. And so overall, Cortrophin saw a modest net positive impact from the Part D redesign through IRA.

And then as far as your second question on next year and going forward, look, it's we believe that there is significant multiyear growth opportunity for Cortrophin in 2026 and beyond. And that's driven by the -- really the strong underlying demand and the demand sort of is centered in the addressable populations, right? Addressable patient populations across key indications are significantly underpenetrated. For acute gaty arthritis alone, it's about 285,000 patients. And our ability to expand the market is highlighted by the fact that approximately half of our prescriber base had never used ACTH therapy before.

And as Chris had mentioned in his remarks, we continue to see growth from both the existing prescribers as well as new prescribers. So we remain confident of being able to reach the appropriate patients in need by working with the HCPs. Thank you, Dennis.

We'll go next now to Faisal Khurshid at Leerink Partners.

Could you speak a little bit more to what this kind of new partner generic product is? And then also what you expect for that in the fourth quarter and kind of going into 2026 as well? And then [indiscernible].

Thank you, Faisal. So for competitive reasons, we're not specifying the name of the partner generic. It's a product that we launched, obviously, as it's intended with another manufacturer. And we're able to capture -- be the sole generic for a period of time, a majority of which was in Q3. In Q4, we have seen some competition enter on that product. So that's why our guidance for Q4 for Generics is showing a sequential drop versus the much higher Q3 that we had. And because it's a partnered generic, it also has profit share in it, and therefore, the gross margins on that product are lower. Going into 2026, we will see at least the existing competition continue, and we look forward to updating you more on the guidance for 2026 in early next year.

Got it. Okay. And then on Cortrophin, are there any inventory or gross to net situations that we should be aware about just because it seems like the volume growth kind of outpaced the actual dollars growth in this quarter?

The Cortrophin Gel growth is driven by strong underlying demand, highest number of new patient starts and new cases initiated since launch, growth across all targeted specialties, the expanded portfolio of sales force that we did in the first quarter drove growth in nephrology, neurology and rheumatology gout, which is one of the newer target specialties now represents 15% of Cortrophin Gel use. That contributed significantly to the growth.

In fact, to the growth, not just in Cortrophin volume, but also to the growth of ACTH naive prescribers. And then the combined ophthalmology sales force continued to build momentum with a 42% increase in volume versus the second quarter of '25. And then underlying just from a presentation perspective, there's strong demand for the prefilled syringe with accounting for almost 70% of the new cases initiated. So it's strong underlying demand that's driving the growth in Cortrophin.

We'll go next now to David Amsellem at Piper Sandler.

So just a couple of quick ones for me. And I'm sorry if I missed this earlier in the prepared remarks. Can you talk about regarding Cortrophin, the growth trajectory in pulmonology and what portion of the mix that is? I think you talked about the other therapeutic areas.

And then secondly, just given just the wide label and all the different indications, where do you envision untapped opportunities that aren't really a big part of the current mix for the product?

And then lastly, I know this is a priority, but just wanted to get your latest thoughts on business development and M&A and how large of a transaction you'd contemplate given the current capital structure?

Yes. Thank you, David. So pulmonology and sarcoidosis is an important therapeutic area for us. We have a dedicated -- a smaller team but dedicated for pulmonology, and we are seeing growth in that area, too. Again, it's a smaller part of the overall Cortrophin picture at this time, but there is a significant growth opportunity there. And in pulmonology, we see a larger number of vials per patient. So I think that's another factor that makes pulmonology an important area for us. So that's on pulmonology.

Regarding the wide label, look, I think currently, as you have seen the addressable patient populations in the indications that we're addressing today is much larger than anything that we're penetrating today. And so our immediate focus is -- our near-term focus is on tapping these different opportunities. And it's across the board, right? It's in neurology, nephrology, rheumatology, we talked about gout, we talked about ophthalmology, the quarter-on-quarter growth. So there's multiple areas.

And part of -- as we think, as Chris thinks about where to drive the growth is where to make the high ROI commercial investments to achieve that growth because there's really -- we're fortunate that there's opportunities across specialties and that we're able to drive growth through existing prescribers as well as have new prescribers who've never -- some that are naive to ACTH and some that were never not even familiar with ACTH adopt Cortrophin or use them in their treatment paradigm for appropriate patients.

And then lastly, to your question on BD, we continue to explore opportunities to expand scope and scale our Rare Disease business. I think that our filters are similar to what they were last time, which is at this time, which is late stage or close to commercial or commercial. and synergistic with either our sales force, right? So call point synergy as was in the case of Alimera or leveraging the rest of our Rare Disease infrastructure, right, which is the market access, patient support, specialty pharmacy distribution and across the board there.

So that's how we think about BD efforts, and we're continuing to explore opportunities. But as I said, as I highlighted, if you look at even the growth this year, we had 34% to 37% growth based on our guidance organically, right? So -- and there's significant growth opportunity, both in Cortrophin and ILUVIEN. So we're not in a hurry to do a deal. We're wanting to make sure that we do the right deal as we expand the scope and scale of our Rare Disease business. Thank you, David.

We'll go next now to Vamil Divan at Guggenheim.

This is Daniel on for Vamil. Congrats on the quarter. So maybe just one question on Cortrophin. Maybe if you could expand a little bit on like what exactly currently is driving doctors to use this drug across these various indications. I know you mentioned that you're focused on generating more evidence around this mechanism now. But maybe currently with what you have, like who are the patients that doctors think are the right ones for Cortrophin versus other alternatives that are available for each of these different conditions?

Sure. And thank you, Daniel. So I'll start and then Chris can jump in. So Cortrophin is a late-line treatment for appropriate patients for which other therapies have been sort of less effective and the real sort of the standard of care and the treatment options that are varying by I guess, by specialty and by indication. So when it fits into the treatment algorithm, it sort of varies. But essentially, it's a late-line treatment option. It's used for -- also for patients that have with this nonsteroidal mechanism of action used for patients that are refractory to steroids or have a high side effect profile.

Chris, would you like to add anything?

Yes. No, I'd just say taking care of patients with autoimmune disorders is challenging. And thank goodness, there are a lot of great options across -- for physicians to use, right, disease-modifying therapies, new innovations across the spectrum and the patients we serve. But there are still patients -- select patients that are really tough to take care of. And physicians are coming to the kind of end of the road in terms of good options for those patients that they can rely on. And there's a significant number of those patients, as we've outlined, who need something different and a new choice of treatment. And I think that's where we focus on those we think there's -- that's a large patient population. It's a difficult-to-treat patient population, and we are just getting started.

We'll go next now to Gary Nachman with Raymond James.

Congrats on another strong quarter. So back on Cortrophin, you just added reps and saw a good ROI on that immediately. Is this market really that promotion sensitive? Maybe just characterize that a bit more? And are there still some pockets where you could add more reps? And would you do that in the near term given the great returns there? And then the prefilled syringe seems to be having a big impact on the acceleration. Was administration really that much of a factor that previously held back use? So just explain more why you're seeing such a benefit from the prefilled syringe helping growth.

Yes. I think, Gary, thank you for your questions. That first question on the impact of and impact of sales reps, I would say that the way we think about it is we expanded our -- the underlying patient demand is very high, right, versus anything that we're capturing. So there are opportunities to reach prescribers, right, that with our sales force, there's opportunities to get in front of more prescribers and spend more time with them that we can keep building on where we are.

So if you look at -- if you think about where we expanded the sales force, we had a combined sales force detailing into neurology, nephrology and rheumatology. And as you can imagine that even within a territory, it's tough to cover all 3 indications. So we expanded the number of sales reps in that area. And what that did is it reduced what's called windshield time and allowing the reps to spend more time speaking with docs about Cortrophin.

And yes, there is opportunity to -- across specialties, across indications as we think about increasing awareness for the appropriate patients of Cortrophin, there's certainly opportunity to do that across multiple areas, right, across the portfolio area, across gout, across ophthalmology. So ophthalmology, I think we're set with the combined sales force we have right now. But there's opportunities sort of across multiple specialties and something that we'll continue evaluating high ROI commercial efforts there. And then your second question on prefilled syringe.

Look, when we launched the prefilled syringe, we had expected that the prefilled syringe would be used for patients that had dexterity issues or issues with their eyesight. But as we're seeing this much greater adoption and it's across specialties, I think when given an option, I think prescribers are just prescribers and patients are choosing the reduced administration step because in the original or in the 5 ml vial, there are 2 steps to the administration. You have to obviously draw the drug from the vial and then administer it and have to use 2 different needles for doing so. So a prefilled syringe is -- it reduces that step in administration and has therefore driven more widespread adoption.

What it has done is there are prescribers that are sort of willing to try a prefilled syringe, probably a bit more than going to a 5 ml vial that requires -- which is a larger use. But I mean, essentially, the growth is coming from the strong underlying demand which would have been there also with the 5 ml vial and the 1 ml vial, the other presentations that are there, the adoption of the prefilled syringe has driven -- has been driven by just the reduced steps of administration.

We'll go next now to Ekaterina Knyazkova at JPMorgan.

Congrats on the quarter. So just a quick one for me. Just remind us how you're thinking about the durability of Cortrophin Gel over time. Just latest thoughts on the possibility of potential generic competition eventually emerging. And I'm not talking like next year, 5, 10, 15 years from now. I think there's obviously a lot of barriers to entry there. But just, I guess, as this class is becoming bigger and probably garnering more attention from potential generic manufacturers.

Sure. Thank you, Katrina. Yes, having a capability in Generics ourselves is we're able to sort of pretty -- we have expertise and capability in assessing the pathway to developing a generic. And our position sort of stays that given this is porcine derived and the mix of -- and the formulation that it is, what it will take to actually develop a generic, it's a very tough pathway. And that's why while many folks have tried it and have not succeeded. It's a very complex development, and there are examples of products like this that are that are tough to genericize. So we continue to believe in the long-term durability of either ACTH product being tough to genericize.

Yes. Sorry, one other thing I would highlight is both us and the competitor have also added patents, strengthened our IP around the products that go into the 2040s. So that's another point on durability. Thank you.

We'll go next now to Brandon Folkes with H.C. Wainwright.

Congrats on another good quarter. Nikhil, just following on from the prior question. Can you just remind us of the challenges of label expansion in the ACTH category for these products? Just sort of in the past, is this label expansion been a cost-benefit decision or practicality decision? And then just sort of any color in terms of if this market does double, the confidence around maintaining exclusivity on gout as a label claim? And then does that Phase IV data give you any potential additional IP around that?

Thank you, Brandon. I think that the -- our interaction -- on your question on label expansion, our interaction with the FDA suggests that any label expansion will need to follow the current rules of the FDA, which requires a Phase IV -- sorry, Phase III clinical trial and all the associated rules that are in place today. So that's what we'll need to do, and that's what our competitor will need to do, whether that's us trying to -- that's our understanding, whether that's us exploring infantile spasms or which is an indication they have that we don't or us exploring or them exploring acute gouty arthritis flares.

And then on the Phase IV data, look, that study was designed and is being executed more to inform and assist physicians in their treatment and hopefully, in their treatment decisions and hopefully could be included in the treatment guidelines, which can drive sort of further adoption.

We'll go next now to Leszek Sulewski at Truist Securities.

Three for me. So just to touch on the sales force again. What are some of the KPIs that you're tracking to back the rightsizing of this team? And what trends have you seen in the sales per rep from the sales force expansion? And any of these metrics would drive your reasoning to potentially increase the sales force?

And then second, can you provide any more color around that partner generic program? Are there additional opportunities in similar scope? Or is this a one-off situation?

And then third, maybe for Steve. As you close out the year, could we potentially anticipate an intangible asset impairment charge tied to the revaluation of the Alimera acquisition?

All right. Thank you for your questions, Les. So I think first is on the sales force. As we believe -- well, on the KPIs, we're going to -- we try to share information that's helpful to investors and competitively sensitive. So I'll steer away from the KPIs. But on the trends, I mean, there's clearly expansion of the sales force in the appropriate areas is a high ROI commercial effort as evidenced by the expansion that we did earlier this year for our portfolio sales team. So that's something that we will continue to evaluate and explore as we move forward.

On the partner generic -- yes, on the partner generic, there are definitely opportunities like that, ones that have been in the hopper that ones that we continue to work on. And it really just highlights our end-to-end capability, right, in BD, in R&D, in commercialization and obviously, in operational excellence.

So across the board, I think we're uniquely positioned with our U.S. manufacturing footprint, right, with more than 90% of our revenues coming from products that are made in the U.S. with our 3 manufacturing facilities that are in the U.S. So we're uniquely positioned from that standpoint. And we absolutely plan to and are already working on such opportunities to capture and to bring to market.

And then on the -- I think the ILUVIEN long-term question, I think that there is -- so beyond Q4 and 2026, we believe the addressable patient populations for ILUVIEN in both DME and NIU-PS are at least 10x the current number of patients currently being treated with ILUVIEN. We expect to see the results of our strengthened ophthalmology organization deploying the expanded peer-to-peer speaker education program and new marketing initiatives.

And then in addition, we continue to disseminate and contextualize the findings of the NEW DAY clinical study and create greater awareness on the potential use of ILUVIEN. So while we see 2025 as a reset year, we are confident in being able to drive growth in 2026 and beyond for ILUVIEN.

And Steve, I don't know if you want to add anything to Les' question with that backdrop.

Yes, I would only add that we evaluate all of our intangible assets on a quarterly basis. And the third quarter for ILUVIEN was no different and obviously, passed that testing in the third quarter. And as Nikhil just outlined, right, when we think about the mid- to long-term forecast for the product, we remain confident in the mid- to long-term opportunities as Nikhil just laid out.

And Mr. Lawani, it appears we have no further questions this morning. So I'd like to turn the conference back to you for any closing comments.

Thanks, everybody, for joining, and we look forward to updating you on our progress in the future. Thanks, everybody.

Thank you very much, Mr. Lawani. Again, ladies and gentlemen, that will conclude today's ANI Pharmaceuticals third quarter earnings call. Again, thanks so much for joining us, everyone, and we wish you all a great day. Goodbye.

Okay. Good Afternoon, everybody. My name is Daniel Cohen. I'm a Managing Director in Morgan Stanley. For important disclosures, please see the Morgan Stanley research disclosure website at www.morganstanley.com/researchdisclosures. If you have any questions, please reach out to your Morgan Stanley sales representative.

With that, we can begin. We are pleased to host Nikhil Lalwani, CEO of ANI Pharmaceuticals with us today. Nikhil, why don't we start out by -- maybe if you can just give us a high-level overview of each of your businesses. You have multiple businesses under the ANI Pharmaceuticals umbrella. Talk about the different drivers in each segment and how investors should think about growth in those segments.

Thank you, Daniel, and good afternoon, everybody. Thank you for joining us here at the Morgan Stanley conference. Much like Daniel, let me clarify that any disclaimer -- any information I speak to is per the disclaimers on forward-looking statements in the corporate deck that we 8-K yesterday as well as references to non-GAAP information -- non-GAAP financial information. And then the guidance that I speak to is the guidance that we gave on August 8, 2025.

So with that, yes, really pleased to be here to share with you the ANI journey towards building a high-growth and profitable rare disease therapeutics business. We have 3 business segments. Rare disease is the key focus area and largest driver of growth. We have 2 assets, Cortrophin and ILUVIEN in the rare disease business. Rare disease will account for approximately 50% of 2025 revenues as per our guidance on August 8 and is our key focus area going forward, also the top priority for capital allocation.

We also have a generics business that has driven strong growth on the basis of superior new product launches by our strong R&D capability in generics, operational excellence and a U.S.-based manufacturing footprint that enables us to compete and do well in the U.S. generics market. And then we have a brands business, which plays a role of providing high margins, strong cash flow generation and we think of a virtuous cycle of growth where we're using EBITDA and cash flows from the generics and margin -- in the brands business to drive growth and increase in scope and scale of the rare disease business.

When you think about the total company in terms of guidance for the year, total revenues is $818 million to $843 million, adjusted non-GAAP EBITDA of $213 million to $223 million. The revenue that I just stated represents 33% to 37% estimated growth over last year, and the adjusted EBITDA is a 34% to 41% growth over last year. So that's an overview of ANI.

Are you able to talk a little bit about the differences in growth and margins between -- for each of those 3 segments?

Sure. So Cortrophin will be -- sorry, our rare disease business with Cortrophin and ILUVIEN will be the largest driver of growth and the key focus area. It's grown from -- when we launched Cortrophin, our lead asset in 2022 being 0 to half the company's revenues in 2025, where it will be -- rare disease will be $409 million to $422 million in terms of guidance. And then the generics, typically, we've guided to high single-digit, low double-digit type growth. And what we've actually delivered over the last 3 to 4 years is much higher than that. The guidance for 2025 is mid-teens growth versus the 2024 number of $301 million in revenues.

Yes. Pretty strong performance growth and margin-wise this year in particular. We note that you've raised guidance 3x this year. Can you talk a little bit about what has done better than anticipated this year?

Sure. Yes, really pleased with the performance this year and the ability to raise guidance 3x. In this year, some of the drivers that went better than anticipated was, number one, Cortrophin. And specifically Cortrophin Gel, we expanded our sales force in the first quarter of 2025 and the impact of that expanded sales force came sooner than anticipated or at a much more impact than earlier anticipated. Second is we launched a new presentation of Cortrophin, the prefilled syringe to enhance or enhance convenience for patients and HCPs. And there's a very strong demand that we've seen for the prefilled syringe.

Originally, we anticipated that the prefilled syringe would be used for patients that had dexterity issues or visual impairment. We're seeing a more widespread adoption of the prefilled syringe. We spoke about 70% of enrollments in July being for the prefilled syringe. So that's the second thing that went better than anticipated. And then the third is on acute gouty arthritis flares. We're continuing to see a strong ramp there amongst indications. That's an indication that only we have and the competitor, which is the only other ACTH drug in the category does not have, acute gouty arthritis flares. So that's on the rare disease and Cortrophin side.

On generics, we launched per our cadence of new product launches, we launched a generic to Mortegrity, prucalopride, in the first -- towards the end of last year in late December, early first quarter. And what we saw is full value of 6 months without the launch of an AG or any other competition entering the market. So we saw the full value of the first 6 months of prucalopride. So these are the really Cortrophin and the upside from generics driving the 3 raises that we've done in the year.

Okay. Great. Maybe just another high-level question before diving a little bit deeper into each of the segments. Some of the themes that are in investors' minds in terms of -- from a global perspective, how -- you mentioned the generics business as U.S. manufacturing capacity. You've also got a portfolio of rare disease drugs. How does the evolving tariff MFN situation, how does that impact each of your businesses?

Yes. ANI is very well positioned versus our peers with regards to both tariffs and MFN. ANI has been focused on the U.S. pharmaceutical industry and 95% of our revenues comes from products sold in the U.S. So that speaks to the MFN exposure. Only one product is sold outside the U.S., our retina product, ILUVIEN. And then we have a small number of one main product and then a couple of small generic products that are sold internationally, but less than 5% of revenues coming from outside the U.S.

When it comes to tariffs, over 90% of our products -- of our revenues comes from products that are manufactured in the U.S., right? We have 3 manufacturing facilities, 2 in Baudette, Minnesota and 1 in East Windsor, New Jersey. So a huge U.S. manufacturing footprint and a commitment to U.S. manufacturing and being part of the solution when there are disruptions in the supply chain and supporting American patients with U.S. manufactured products. And so from a tariff perspective, we are very well positioned because over -- again, over 90% of our revenues comes from products that are -- finished goods that are manufactured in the U.S.

Got it. Okay. Makes sense. Maybe just diving deeper on Cortrophin. Can you talk a little bit about that market and the competitive field in that market and some of the dynamics that you're experiencing right now?

Sure. So I think that the -- especially for investors that are new to ANI Pharmaceuticals, Cortrophin Gel, our lead product, is a repository corticotropin that is used to treat certain chronic autoimmune disorders and has multiple indications, almost over 20. We focus on 6 indications. And this ACTH market has only had one competitor for an extended period of time until we entered in 2022. And what we've seen is that since we entered, the market has most recently started growing again. It went through a period of deceleration, but has started growing again. The growth in 2024 was 27% and the growth in 2025, if you add our guidance and the competitors' guidance is 39%.

Most importantly, and the key driver of this growth is the underlying patient demand. So there are -- even today, the number of patients being treated are almost half the number of patients that were being treated when the market was at its peak in the past. And so what is most heartening to see is between our efforts and the competitors' efforts, we are able to get ACTH therapy to patients in need across indications.

Going beyond that, and we believe strongly that Cortrophin has a strong multiyear growth trajectory. And the reason we believe that is when you look across indications, even the 6 indications that we focus on, the addressable patient populations in each of those different therapeutic area -- in each of those different indications is much larger than anything than the patients that are being addressed by the combined efforts of the competitor and ourselves. So the growth opportunity is significant.

Reasons to believe that we will be able to capture more of that addressable patient population are as follows: Firstly, over the past 4 years, 50% of our prescribers are prescribers that were naive to ACTH. That is their first ACTH prescription was Cortrophin Gel. So we are able to reach more prescribers, talk to them about the appropriate patients and the benefits of ACTH therapy and have them use Cortrophin.

Second is that we see growth across specialties. It's not -- the growth is not coming from any one specialty. We have, as I said, 6 different indications, multiple sclerosis, rheumatoid arthritis, nephrotic syndrome, sarcoidosis and then a couple of ophthalmology indications and acute gouty arthritis flares. And so we see growth across indications. That's another reason to believe. And then third is we see growth from both new prescribers and existing prescribers. So all of these different factors enable us to see that the ACTH market, while it's returned back to growth, the addressable patient populations are much larger and that between our efforts and the efforts of the competitor, we're able to go out and get this therapeutic or this class of therapeutic to patients in need.

Can you talk a little bit about what happened in that market and before you kind of made a dip and now it's returning to growth. How should we think about that and the possibility for that happening in the future?

Sure. Look, I think this was obviously before we entered the market. So I have to be thoughtful about what I share here. What I can say comfortably is that the reasons for the decline were largely external to the product itself. The competitor had to deal with other issues when they were the sole -- had the sole product in the category. Other company-related issues that were not specific to the ACTH category. They had to deal with bankruptcy too that they've successfully worked through and congratulations to them on that.

And so the decline was driven by factors that had nothing to do with the efficacy of ACTH therapy. And that's what we've seen is when we've come back or when we've launched Cortrophin Gel, not only have we been able to convince ACTH believers to write Cortrophin, but also -- use Cortrophin for their appropriate patients, but also have new prescribers, right? Over 50% of our -- almost 50% of our prescribers are prescribers that had never used ACTH before.

You mentioned a new prefilled syringe and expanded sales force and that you have 6 indications out of 20 or more theoretical indications. Are there any other initiatives that one should be thinking about as we look out into the future around Cortrophin Gel?

Sure. So we believe in the strong multiyear growth trajectory for Cortrophin. Our guidance for this year is $322 million to $329 million. We think that there's -- we believe that there's strong multiyear growth potential beyond driven largely by the addressable patient population that we can capture. We're investing in 3 types of initiatives to strengthen the Cortrophin franchise and capture this multiyear growth. First is evidence generation and research. The evidence generation and research falls into 2 buckets.

First would be there's a bunch of work we're doing on preclinical to establish the mechanism of action or not establish, but share more information on the mechanism of action. We're fortunate to be able to do this with industry-leading KOLs that adds more credibility to the category and are able to show the nonsteroidal mechanism of action, which is a key part of growth in the ACTH category.

In addition, we launched a Phase IV clinical study for acute gouty arthritis flares. And our hope is that with a successful outcome there, we will be able to get Cortrophin added to the ASN guidelines. So that's number one, which is evidence generation and research.

Second is from a product presentation standpoint. So we've launched initially with a 5 ml vial, which was our original presentation, and then we launched a 1 ml vial. Cortrophin is self-administered. So the 5 ml vial was being used for self-administration. But for gout, the right dosing, acute gouty arthritis flares, the right dosing is a 1 ml vial. So we launched a 1 ml vial. And then most recently, in April of this year, as you referred to, Daniel, we launched a prefilled syringe, and this is really for patients that have dexterity issues or visual impairment. Now we've seen broad adoption of this. And we're continuing to work on other steps in the second group of presentations to improve patient and HCP convenience.

And then third is high ROI commercial initiatives, as you would expect, to continue expanding the Cortrophin market and capturing this addressable patient population that we have.

And is the prefilled syringe is that unique to Cortrophin Gel? Or is the competitor product have a similar prefilled syringe?

The competitor does have a self-check, what they call a self-check and we have the prefilled syringe.

Got it. Okay. Final question on Cortrophin for me. Can you talk about LOE risk of how you think about end of protection, if you will, for the product?

Sure. Yes, this is both the competitor, and we have a complex formulation of peptides that are derived from the -- that are porcine derived from the pituitary glands. And these mix of peptides are then dispersed in a gel. And therefore, this is a complex formulation that is hard to copy and show equivalence. And therefore, it is a tough drug to genericize. There are other analogs of animal-derived products that have been hard to genericize. So that's one level of protection.

And then the second level of protection is the -- both the competitor and us have added IP that goes into the 2040s into 2040 to 2043 that, again, provides additional protection against generics. So we are strong believers in the durability of the ACTH category and see this as a multiyear growth opportunity. And I would be remiss before we move on, on Cortrophin to again point out that even with all the growth that we've seen and that the competitor has seen, remember, the competitor is seeing 20% to 30% growth this year. Even with both of us, we're still treating a very insignificant part of the addressable patient population. And just as an example, if I may, right, if you take multiple sclerosis, there's 750,000 patients that get -- that have -- they're diagnosed with multiple sclerosis, only a small subset of that are patients that are -- that get exacerbations and do not respond to a steroid. So there's about 300,000 flares for MS that we think is an addressable patient population -- addressable population for ACTH and what we're treating is an insignificant.

And in our deck, in the new corporate deck on Slide 16, you'll see we lay that out across 5 indications, and that's a tremendous opportunity for getting patients in need the appropriate therapeutic that can be helpful as a late-line therapeutic through the efforts of both us and the competitor.

Okay. Anything else you want to cover?

No, I'm good on Cortrophin.

Happy to [indiscernible].

Thank you.

Okay. Good. Maybe let's shift to the ophthalmology portfolio. I think certainly, earlier in the year, in particular, there were some headwinds that impacted Medicare patients. Can you talk about -- a little bit about what changed this year? What are the headwinds? And where do we sit today?

Sure. So really 2025, we think of it as a bit of a reset year for our ophthalmology and retina franchise that we acquired from Alimera. And there's been a number of different factors. Obviously, the one that's most prominent and the biggest one is the nonavailability of co-pay support for Medicare patients that do not have any supplementary insurance. That funding went away in the early part of this year and has not returned.

And at this point, I think we're all -- every all organizations, ANI and other organizations in ophthalmology and retina are focused on finding solutions for the patients, assuming that this co-pay support doesn't come back. Now having said that, there are a number of organizations that have spoken about efforts to bring that co-pay support funding back. But at this point, our assumption in the guidance given on August 8 was that the co-pay support would not come back.

In addition, we had churn in our sales force as we combined the original Alimera sales force with the ANI ophthalmology team to create a combined sales force to sell both Cortrophin and ILUVIEN. We have all those replacements in place and we have a full team that's out there detailing both Cortrophin and ILUVIEN. In addition to strengthen that team, we have new marketing materials, a newly launched peer-to-peer marketing and speaker program. And then very importantly, we had NEW DAY, a Phase IV clinical study for ILUVIEN that was done, and we announced the results in July. And again, in this new corporate deck, we've detailed the publication and presentation plan that -- where we're presenting the results of NEW DAY. We presented at ASRS. We presented it at EURETINA and when we say we -- leading KOLs, right, Dr. Singer, Dr. Wykoff, Dr. Gonzalez. And we'll now present it at American Academy of Ophthalmology in a podium presentation and then at Hawaiian Eye.

So this is rich new set of data across 300-plus patients for the use of ILUVIEN early in the treatment of DME in conjunction with anti-VEGFs. So when you think of the ophthalmology and retina franchise as a whole, while we're working through challenges in 2025, and it's a bit of a reset year for the franchise, there's -- the underlying patient demand is very strong, both in DME and NIUPS. We're treating less than 5,000 patients out of more than 50,000 patients addressable in DME and more than 75,000 patients in NIUPS. And then equally important, we have a slew of these initiatives that I talked about, right?

The NEW DAY clinical study results, the new peer-to-peer speaker program, a stronger sales organization, all of these that will enable driving stronger performance as we move forward.

Okay. Anything else you want to cover on the ophthalmology franchise?

Yes. I would say the one other piece that we -- that I forgot to mention, thank you for that, Daniel, is that for ILUVIEN, we now -- for simplicity of supply chain and securing the supply chain, we added the NIUPS, non-infectious uveitis of posterior segment of the eye label -- indication to the ILUVIEN label that are now marketing just ILUVIEN, and that simplified the supply chain, and we're working through that transition in the third quarter.

Okay. So I wanted to shift to your generic business, which has been -- it's been a double-digit growth business for the past 2 years, which a little bit contrary to what others have seen perhaps in the U.S. generics market. And you've talked about mid-teens growth for this year. Can you talk a little bit about what differentiates your business relative to the broader U.S. generics sector?

Sure. So yes, we have been able to deliver almost 2.3 billion doses to American patients in the last 12 months of generic products. We do that on the back of a strong operational excellence and 3 U.S.-based manufacturing facilities, 2 in Baudette, Minnesota and 1 in East Windsor, New Jersey. So the U.S.-based manufacturing footprint is unique to ANI. All these 3 sites are in strong GMP status, strong GMP track record with either VAI or NAI status across these 3 sites.

And really, the crux of generic success is new product launches, right? Our pipeline, right, the product selection and then the execution of the pipeline and being able to consistently bring lower -- lesser competition products to the market quicker. We launched between 10 to 15 products every year. That's been our cadence across the last 4 to 5 years. And we've actually -- while we speak about high single-digit, low double-digit growth, in reality, we deliver even higher than that and have done consistently over the past 4 years. This year, we talk about mid-teen growth. I think -- and as an example of the strength of our R&D, we'll talk about prucalopride, which is a 180-day exclusivity and sole generic approval that we got earlier this year or late last year, earlier this year, where there were 12-plus competitors pursuing this product, and we were able to get the approval first and consequently get 180-day exclusivity.

So really strong pipeline selection, superior R&D execution and then an operational backbone that is strong and U.S.-based to support the generics business. That's the driver of success in our generics business.

Is the strategy in the generics business driven by 180-day exclusivities? Or is it broader than that?

No, no, it is broader than that. We -- I think we always try to find an angle on the pipeline selection. So whether it's the API, whether it's lesser competition, lesser focus areas. One of the things we benefit from is the scale as we were growing, we're now a $300 million business that's growing mid-teens. So the value of launches that is meaningful for us is different from what is meaningful to a much larger player. But so being able to identify those opportunities and then execute and capture those opportunities has been important.

Okay. How do you think about just shifting a little bit to close out? How do you think about capital allocation for the company?

Yes. Thank you. So we are focused on expanding the scope and scale of our rare disease business. We have a strong balance sheet with about $218 million of cash as of June 30, 2025, and 1.9 turns of net leverage, assuming the guidance that we gave on August 8. So that gives us a strong balance sheet and the ability to use that balance sheet to expand scope and scale of our rare disease business. And that is our focus area, identifying products that are synergistic with 1 of 2 things, right, either call point synergy with Cortrophin, like the Alimera acquisition where ophthalmology was a key focus area for Cortrophin. And so we found another product, ILUVIEN, that is synergistic from a call point standpoint.

And so we have that opportunity now in the other therapeutic areas, rheumatology, nephrology, neurology, pulmonology. What we also have is a capability in rare disease of using the back infrastructure, which is basically medical affairs, patient support, market access, especialty pharmacy distribution. And so finding rare disease assets that may not be synergistic from a call point perspective, but are -- can have small patient populations, small sales forces, maybe in a newer therapeutic area, but leverage the rest of the rare disease infrastructure that we have and the core capability we have. That's how we're looking for assets like that, too.

Two other things to add. We are in no hurry to do an acquisition next. We're obviously -- we have strong organic growth drivers and are exploring that. Having said that, we're continuing to explore, but there's no immediate need to do an acquisition. So that's one. And I think the second thing is in the terms of the type of acquisition we would look to in rare disease, we would look at commercial assets as a next step. And then as we continue to expand the scope and scale, taking appropriate sized clinical bets at some point in the future and building the development capability to as we build an integrated rare disease company in the future.

And how would you -- how do you see the market for whether it's product or company acquisitions right now? Is it particularly competitive? Or over the last few years, do you see it as being more or less competitive than it has been?

Yes. I think we're not the only people looking for rare disease assets. And the advantage we have is that we have beachheads in multiple therapeutic areas. So that's an advantage for us as we scan and look for assets. And then also, we have a strong performance and a strong balance sheet to support as we pursue our growth -- pursue our M&A strategy. And again, to recap, we're not under pressure from a time standpoint to do because we have organic growth opportunities to pursue an acquisition. So we can do it in the right time and take our time to do the right deal.

Thank you. Well, Nikhil, a lot of success from your leadership at ANI, proven ability to get products approved, make acquisitions and commercial success. So congratulations to you on all your success. Happy to open the floor to any questions if anybody has any. Feel free to raise your hand. If not, we can close there.

Thank you, Daniel, and thank you, everybody, for joining us, and we look forward to updating you on our progress in the future. Thank you.

Thank you.

Thank you.

Good day, everyone, and welcome to today's ANI Pharmaceuticals, Inc. 2Q 2025 Earnings Results Call. Please note, this call is being recorded. [Operator Instructions] It is now my pleasure to turn the conference over to Lisa Wilson. Please go ahead.

Thank you, operator. Welcome to ANI Pharmaceuticals' Q2 2025 Earnings Results Call. This is Lisa Wilson, Investor Relations for ANI. With me on today's call are Nikhil Lalwani, President and Chief Executive Officer; Stephen Carey, Chief Financial Officer; Chris Mutz, Senior Vice President and Head of ANI's Rare Disease business; and Dr. Mary Pao, our Chief Medical Officer.

You can also access the webcast of this call through the Investors section of the ANI website at anipharmaceuticals.com. Before we get started, I would like to remind everyone that any statements made on today's conference call that express a belief, expectation, projection, forecast, anticipation or intent regarding future events and the company's future performance may be considered forward-looking statements as defined by the Private Securities Litigation Reform Act. These forward-looking statements are based on information available to ANI's management as of today, and involve risks and uncertainties, including those noted in our press release issued this morning and our filings with the SEC. Such forward-looking statements are not guarantees of future performance. Actual results may differ materially from those projected in the forward-looking statements. ANI specifically disclaims any intent or obligation to update these forward-looking statements, except as required by law. The archived webcast will be available for 30 days on our website, anipharmaceuticals.com.

For the benefit of those who may be listening to the replay or archived webcast, this call was held and recorded on August 8, 2025. Since then, ANI may have made announcements related to the topics discussed, so please reference the company's most recent press releases and SEC filings.

And with that, I'll turn the call over to Nikhil Lalwani.

Thank you, Lisa. Good morning, everyone, and thank you for joining us. I'll start by discussing our second quarter performance and highlights, along with our raised 2025 guidance. Chris Mutz will then provide additional color on our rare disease business, including our lead asset Cortrophin Gel, and our retina assets, ILUVIEN and YUTIQ. Finally, Stephen Carey, our CFO, will review our second quarter results and updated 2025 guidance in more detail. Following our remarks, our Chief Medical Officer Officer, Dr. Mary Pao, will join us, and we will take your questions.

This was a record-setting quarter for our company with all-time overall company highs in net revenue, adjusted non-GAAP EBITDA and adjusted non-GAAP EPS, reflecting very strong momentum across both our rare disease and generics business units. Our rare disease team delivered exceptional year-over-year and sequential quarterly growth with Cortrophin Gel demand accelerating in both new patient starts and new cases initiated reaching new highs. We continue to pursue initiatives to improve the performance of our retina franchise, yielding positive results. And our generics business delivered another solid quarter, driven by new product launches and strong operational execution.

Based on our very strong second quarter performance and broad-based momentum across rare disease and generics, we are raising our 2025 guidance for total net revenues, adjusted non-GAAP EBITDA and adjusted non-GAAP EPS. We now expect 2025 revenues of $818 million to $843 million, which represents growth of 33% to 37% over 2024 versus our prior guidance of $768 million to $793 million. We expect rare disease to account for approximately 57% of total company net revenues in the second half of 2025. We expect adjusted non-GAAP EBITDA of $213 million to $223 million, which reflects growth of 37% to 43% over 2024 versus our prior guidance of $195 million to $205 million. Lastly, we expect adjusted non-GAAP earnings per share between $6.98 and $7.35, up from our prior guidance of $6.27 and $6.62. Steve will provide more specifics on our increased guidance later in the call.

Turning now to our second quarter results. Total net revenues were $211.4 million, representing year-over-year growth of 53% on an as-reported basis and 37% on an organic basis, driven by strong growth for our lead rare disease asset, Cortrophin Gel and our generics business. Adjusted non-GAAP EBITDA was $54.1 million and adjusted non-GAAP EPS was $1.80.

Cortrophin Gel had an exceptional quarter, with revenues of $81.6 million, up 66% year-over-year and 54% from the first quarter of 2025. Strong execution by our commercial teams including our newly expanded portfolio sales team, the successful launch of our prefilled syringe and continued momentum across our target therapeutic areas contributed to record demand in the second quarter. As a reminder, in the first quarter, we expanded our portfolio sales team, which promotes Cortrophin Gel in neurology, nephrology and rheumatology from 52 to 70 members, remapping and increasing the number of sales territories led to a meaningful increase in productivity as the smaller territories allowed all of our reps to spend more time detailing Cortrophin and less time traveling. As a result, the team was able to produce a meaningful sequential quarterly growth in new cases initiated and new patient starts that exceeded our prior expectations.

We also saw strong interest and demand for our new Cortrophin Gel prefilled syringe presentation, which we launched in April. The prefilled syringe offers advantages to both patients and physicians by reducing the number of steps required for self-administration, which is especially important for patients with impaired vision or limited hand mobility. We expect the prefilled syringe to remain an important driver of prescription demand going forward.

Based on continued growth in Cortrophin Gel, prescribers and patients as well as broad adoption across therapeutic areas, we are increasingly confident that Cortrophin is on a strong multiyear growth trajectory. The ACTH market grew 27% to $684 million in 2024 and is expected to grow 36% to $933 million in 2025 based on the midpoints of our new guidance and the competitor's guidance. While recent growth in the ACTH market has been strong, the current number of patients on ACTH therapy remains significantly below historical levels, offering substantial room for expansion. We estimate that today's patient base is still roughly half of what it was at the market's peak in 2017. In addition, today's ACTH market covers a broader set of indications, including acute gouty arthritis flares, which was not there in 2017. Further, based on our epidemiological analysis, we believe that the addressable patient population for ACTH therapy could be many times larger than the previous high of 8 years ago. Importantly, a large and growing group of our prescribers were previously naive to ACTH. We believe that, that number now exceeds 50%. We remain confident in our rare disease team's ability to sustain robust multiyear growth for Cortrophin Gel. Based on our first half performance and continued strong underlying demand trends, we are increasing our 2025 Cortrophin Gel guidance to $322 million to $329 million from our prior guidance of $265 million to $274 million. Our new guidance reflects year-over-year growth of 63% to 66%.

Turning now to our retina portfolio. Our retina portfolio, ILUVIEN and YUTIQ generated revenues of $22.3 million in the second quarter, consistent with our expectations. Our commercial team progressed several key initiatives during the second quarter. We executed on the addition of the chronic NIU-PS indication to ILUVIEN's label and fully transition our U.S. promotional focus to ILUVIEN. At the same time, we remain committed to supporting physician offices in navigating ongoing Medicare market access challenges, particularly for patients who previously relied on foundational support. We also took important steps to strengthen our U.S. ophthalmology sales team. As noted earlier, we remain on track to realize meaningful revenue synergies for Cortrophin within ophthalmology. Our international ILUVIEN business, accounting for over 1/3 of ILUVIEN revenues continues to perform well across both our direct markets and those served by distribution partners. We also completed the NEW DAY clinical trial of ILUVIEN in earlier-stage DME and presented the results at the American Society of Retina Specialists, or ASRS, Annual Meeting. NEW DAY was the first clinical study that tested a long-acting steroid against anti-VEGF standard of care treatment. Feedback on the NEW DAY results from study investigators and retina physicians at ASRS was positive and reinforce our view that the data could help support the use of ILUVIEN earlier in the DME patient journey. Chris will speak more on NEW DAY and our next steps with the data.

While the second quarter was productive for our ophthalmology team and we successfully executed against our objectives, externally, the market access challenges that have impacted prescribing of retina drugs for Medicare patients since January have persisted. We previously assumed that some funding for Medicare patient support foundations would resume and Medicare access would improve in the second half after a large ophthalmology company launched its matching program for donations to the Good Days fund. Unfortunately, this has not yet happened. So we made the decision to update our guidance to reflect this dynamic. We now expect 2025 revenues for our retina franchise of $87 million to $93 million versus our prior guidance of $97 million to $103 million.

Moving now to our generics business, which also delivered strong performance in the second quarter with revenues of $90.3 million, an increase of 22% over the prior year period. The quarter reflected strong execution in our base business and contribution from new product launches, including prucalopride tablets with 180-day exclusivity. Based on the performance of our generics business in the first half of the year, we continue to expect growth for the full year in the mid-teens.

Our brand portfolio also had a strong quarter with revenues of $13.2 million, up 32% year-over-year. We were able to identify and capture increased demand for certain products during the second quarter and anticipate a return to a more normalized level of demand during the second half.

Next, I will review a few points regarding ANI standing in the evolving tariff situation. While we await the administration's pharmaceutical industry-specific framework, it is worth reiterating ANI's long-standing commitment to the U.S. pharmaceutical industry and are positive and unique positioning relative to our peers. We are a U.S. domiciled pharmaceutical company with over 90% of total company revenues coming from finished goods manufactured in the U.S. Products representing less than 5% of our total company revenues rely directly on imports from China. In addition, we have a strong balance sheet that enables us to carry healthy levels of finished goods and raw material inventories. We look forward to maintaining our strong commitment to the U.S. pharmaceutical industry.

Before I turn the call over to Chris, I'd like to comment on the recent trial with CG Oncology. As a reminder, under an assignment and technology transfer agreement dated November 15, 2010, ANI had sold CG0070 cretostimogene and related assets such as the Investigational New Drug Application, or IND, Phase I, Phase II clinical data, know-how and IP to CG Oncology. ANI commenced the civil action against CG Oncology in the Superior Court of the State of Delaware in March 2024, alleging that CG Oncology is liable to pay a running royalty of 5% on the worldwide net sales of their lead product CG0070 or cretostimogene, that creates procedure to trial on July 21 and the jury returned the verdict in favor of CG Oncology on July 29. We continue to believe in the merits of our position and intend to vigorously challenge the predict through post-trial motion and/or an appeal. I'll now turn the call over to Chris to discuss our rare disease business in more detail. Chris?

Thank you, Nikhil, and good morning, everyone. Our rare disease team was highly productive during the second quarter. We generated record demand for Cortrophin Gel with broad-based strength across specialties, and we made good progress capturing opportunities and addressing challenges for our retina franchise. First, on Cortrophin Gel. We are very pleased with continued strong demand and feedback from physicians. Similar to the last several quarters, we saw growth across all of our targeted specialties. The number of cases initiated and new patient starts reached record high, our expanded portfolio sales team hit the ground running, adding new prescribers and driving meaningful increases in new patient starts across neurology, nephrology and rheumatology. Our specialty focused teams produced strong growth in our newer areas of pulmonology and ophthalmology, and we believe we are still in the early stages of penetrating these therapeutic areas.

In ophthalmology, we saw a record number of new cases initiated and a 33% sequential quarterly increase in Cortrophin volumes. We have already realized meaningful revenue synergies as a result of the Alimera acquisition and believe there are further opportunities as we expand awareness of Cortrophin utility in helping patients with severe allergic and inflammatory eye condition.

We saw very strong demand for our new Cortrophin prefilled syringe offering, which we launched in April. The reduced number of steps required to administer the prefilled syringe has resonated with patients and physicians and we observed prescribing of the prefilled syringe ramp across indications during the quarter. We are pleased to report that the prefilled syringe already accounts for approximately 70% of new cases initiated only 3 months into its launch.

Cortrophin Gel prescribing for acute gouty arthritis flares remained a strong driver in the second quarter. As a reminder, the gout indication is unique to Cortrophin Gel among ACTH therapies. Gout accounts for approximately 15% of Cortrophin Gel use and has contributed significantly to the growth of new prescribers for Cortrophin. We're continuing to invest in evidence generation for Cortrophin Gel with our previously announced Phase IV trial in acute gouty arthritis flares. We believe the 150-patient study will provide physicians with valuable insight on the treatment of acute gouty arthritis flares with Cortrophin Gel and could support positioning in the American College of Rheumatology treatment guidelines.

We are also pleased to announce two new publications of important preclinical data that expand the body of evidence around the use of Cortrophin Gel in nephrology and ophthalmology. Firstly, our preclinical study of Cortrophin Gel in uveitis that was presented earlier this year has been published in ocular immunology and inflammation. Secondly, a manuscript for a preclinical study of Cortrophin Gel in membranous nephropathy was accepted for publication and molecular therapy, a leading journal in the field of innovative therapeutics. The study speaks directly to the steroid independent mechanism of action of Cortrophin Gel in an animal model of membranous nephropathy, specifically its effect on the complement system, an area of significant interest in ongoing membranous nephropathy drug development. Overall, we are delighted with the growing recognition of Cortrophin Gel as a treatment option for appropriate patients and look forward to delivering strong multiyear growth for the product.

Turning to our retina franchise. As Nikhil mentioned, in the second quarter, our commercial team was focused on managing the ILUVIEN launch with the combined label for chronic and NIU-PS and DME, and transitioning promotional efforts fully to ILUVIEN. We have successfully hired and onboarded nearly all vacancies across our sales territories and now have a full team dedicated to educating and supporting the retina community. In mid-June, we began promoting ILUVIEN under the combined label for chronic NIU-PS and DME, and the transition is on track with our sales teams educating customers across the country and our market access team working with payers to establish coverage for ILUVIEN's new and NIU-PS indication. We've received positive feedback on the convenience of a single product covering both indications.

Also in Q2, we strengthened our promotional efforts, launching new peer-to-peer educational speaker programs and new refreshed marketing materials for ILUVIEN, which are helping our sales team increase awareness among retina physicians. Our initiatives to help physician practices navigate the market access challenges for Medicare patients that have impacted the retina market since early January yielded positive results in the quarter. As a reminder, patient support foundations, such as Good Days did not receive sufficient funding for 2025, which affected their ability to assist Medicare patients with copay support. This change in access affected retina products broadly and was not unique to our portfolio. The magnitude of the disruption of this lack of foundation funding has had on the treatment of retinal diseases in Medicare patients was actually a topic of a paper at the recent ASRS meeting in Long Beach, California. In a survey of 455 retina specialists presented at the meeting, 94% of respondents reported a significant or moderate impact on their practice and 78% of respondents noted that at least 25% of their Medicare patients were unable to receive their preferred medication.

Our commercial team has been working closely with retina practices help improve access for Medicare patients, including accessing ILUVIEN through a specialty pharmacy using Medicare Part D benefits. I'm very proud of how our team executed in the quarter, while facing these significant access challenges. We're hopeful that funding for patient support organizations will resume in the second half, which should help increase access for Medicare patients to ILUVIEN and other retina products. As a reminder, one of the largest companies in the retina space recently initiated a matching program for donations to Good Days through which it will match up the $200 million of donations over the balance of 2025.

We recently presented the results from our NEW DAY study of ILUVIEN in patients with DME at the American Society of Retina Specialists Annual Meeting in Long Beach, California. Feedback on the results from study investigators and retina physicians at ASRS was very positive. And although the study did not meet its primary endpoint, some physicians have indicated that the NEW DAY data may support treating DME patients earlier with ILUVIEN based on its role in reducing treatment burden for these patients. Following the release of this data, several next steps are underway. We are preparing additional presentations at upcoming national and international conferences to further share and contextualize these findings. In parallel, we are actively exploring the potential of including NEW DAY and promotion aimed at increasing awareness and understanding of the study results. With that, I'll turn the call over to Steve for the financial update. Steve?

Thanks, Chris, and good morning to everyone on the call. I'll review our second quarter results and then discuss our updated guidance for the full year. ANI generated revenues of $211.4 million in the second quarter, up 53% over the prior year period. Revenues from rare disease and brands were $117.2 million in the second quarter, approximately double the prior year period on an as-reported basis and up 60% on an organic basis, driven by growth in our rare disease franchise. Rare Disease revenues were $104 million, up 111% from the prior year. Revenues from Cortrophin Gel were $81.6 million, up 66% from the prior year period, driven by increased volume on a record number of new patient starts. Revenues from ILUVIEN and YUTIQ were $22.3 million, up from $16.1 million in the first quarter. Revenues for brands were $13.2 million in the second quarter, up 32% versus the prior year period. We continue to capture increased demand for certain products through a portion of the second quarter and anticipate a full return to more normalized level of demand during the second half of the year.

Revenues for our generics and other segment were $94.2 million, an increase of 20% over the prior year period. Revenues for generics were $90.3 million, an increase of 22% over the prior year period, driven by increased volumes on contributions from new product launches in 2024 and the first half of 2025, including our launch of prucalopride with its 180-day CGT exclusivity.

Now moving down the P&L. As a reminder, when I speak to our operating expenses, I will be referring to our non-GAAP expenses, which are detailed on Table 3 in our press release. Generally, our non-GAAP operating expenses exclude depreciation and amortization, stock-based compensation and certain costs related to litigation and M&A activity. Please refer to Table 3 for a reconciliation to our GAAP expenditures.

Non-GAAP cost of sales increased 29% to $74.2 million in the second quarter of 2025 compared to the prior year period, primarily due to net growth in sales volumes and significant growth of royalty-bearing products. Non-GAAP gross margin was 64.9%, an increase of over 6 points from the prior year period, principally due to favorable mix towards rare disease products and strength in generics driven by the prucalopride 180-day exclusivity, which concluded at the end of the second quarter. Non-GAAP research and development expenses were $16 million in the second quarter, an increase of 130% from the prior year period driven by higher investments to support future growth of our rare disease and generics businesses, spend related to our NEW DAY study as well as year-over-year timing of spend.

Non-GAAP selling, general and administrative expenses increased 66% to $67.1 million in the second quarter driven by spend for our new larger ophthalmology sales team promoting Cortrophin Gel and ILUVIEN and continued investment in rare disease sales and marketing activities including the new sales representatives that we added in the first quarter. Adjusted non-GAAP diluted earnings per share was $1.80 for the second quarter compared to $1.02 per share in the prior year period. Adjusted non-GAAP EBITDA for the second quarter was $54.1 million compared to $33.2 million in the prior year period.

Turning to the balance sheet. We ended the second quarter with $217.8 million in unrestricted cash, up from $149.8 million at the end of the first quarter. Cash flow from operations was $110.8 million in the first half of the year. As of June 30, we had $635.2 million in principal value of outstanding debt, inclusive of our senior convertible notes and term loan. At the end of the second quarter, our gross leverage was 3.3x, and our net leverage was 2.2x our trailing 12-month adjusted non-GAAP EBITDA of $190 million. Utilizing the midpoint of our revised 2025 adjusted non-GAAP EBITDA guidance, our net leverage is approximately 1.9x on a forward basis.

Now turning to our updated 2025 financial guidance. We are raising our guidance for total revenue and adjusted non-GAAP EBITDA primarily based on higher estimates for our rare disease business. Our updated guidance is as follows: Full year 2025 net revenue of $818 million to $843 million, up from our prior guidance of $768 million to $793 million representing year-over-year growth of approximately 33% to 37%. Cortrophin Gel net revenue of $322 million to $329 million, up from our prior guidance of $265 million to $274 million, representing growth of 63% to 66%. We continue to expect sequential growth of Cortrophin revenues in the third and fourth quarters.

Combined ILUVIEN and YUTIQ net revenue of $87 million to $93 million, versus our prior guidance of $97 million to $103 million. Our revised guidance assumes no meaningful change in the co-pay funding gap facing Medicare patients in retina for the remainder of the year. Generics revenue growth in the mid-teens, driven by strength in our base business and contribution from new product launches. Consistent with our expectations and previous guidance, we expect generics revenue in the second half of the year to be lower than that of the first half due to competitive entrants into the prucalopride market that occurred late in the second quarter. Adjusted non-GAAP EBITDA of $213 million to $223 million, up from our prior guidance of $195 million to $205 million, representing growth of approximately 37% to 43%. And adjusted non-GAAP earnings per share between $6.98 and $7.35, up from our prior guidance of $6.27 and and $6.62.

We currently anticipate a full year U.S. GAAP effective tax rate of approximately 24% to 25%, and consistent with prior quarters, we will tax affect non-GAAP adjustments for computation of adjustments of adjusted non-GAAP EBITDA diluted earnings per share using our estimated statutory rate of 26%. We also continue to anticipate between 20.3 million and 20.5 million shares outstanding for the purpose of calculating diluted EPS.

With that, I'll turn the call back to Nikhil

Operator, please open the line for questions.

[Operator Instructions] We'll take our first question from Gary Nachman with Raymond James.

Congrats on the great quarter. So given the strength you saw in Cortrophin in the second quarter, first, I wanted to make sure there wasn't anything unusual in there in terms of onetime benefits or seasonality with any of the indications. And with the great ROI you're getting with the increased sales force, it begs the question if there are other adds to the sales force you'll consider doing in any of the areas anytime soon, especially with the good market growth and the headroom there? And then you called out ophthalmology and gouty arthritis flares as the biggest drivers of growth. Is there still a lot of upside potential in both of those markets? Maybe you could walk through that.

Thank you, Gary. I'll take each question. So the first question on seasonality or onetime benefit on Cortrophin. No, this is driven by the underlying demand. I think the factor to consider as new patient starts, which have more than doubled in Q2 '25 versus Q2 '24. So this is -- the performance is an outcome of the increased demand rather than seasonality or benefit -- any onetime benefit. So that's one. Second, we do not contemplate adding at this time additional sales team members. Having said that, obviously, we continue to evaluate high ROI commercial initiatives to sustain the long-term growth of Cortrophin. We believe that there is a multiyear strong growth runway for Cortrophin and are investing both in evidence generation that Chris spoke about, bringing new presentations. We brought the 1 ml and the 5 and the prefilled syringe, and we're investing in other ways to increase the physician and patient convenience. So that's how I would think about continuing to grow the franchise to deliver strong. Look, ophthalmology revenue synergies that we saw in Q2, which led to the 33% increase in volume is important. The gout additional acceleration is also important. But really, we have growth across therapeutic areas and indications. And we're really nowhere close to the addressable market, right? As we've spoken about epidemiologically, when you look at these different indications and look at the addressable market as a subset of the patients that are refractory or for whom steroid-resistant, the addressable market is many times larger than even what was being treated at the peak. So the -- that provides substantial room for expansion. And the other data point that was important that we shared is -- more than 50% of our prescribers are HCPs who had not used ACTH prior to the launch of Cortrophin. So that gives us additional confidence in driving this sustainable long-term multiyear growth in Cortrophin.

Okay. Great. And just a couple of quick follow-ups. With the additional cash flow that you're generating with the good performance, just what are your priorities in terms of use of capital debt paydown or business development? And how much more active are you getting on the BD front? And then just gross margin, why isn't that guidance coming up more, just given that the mix is shifting more for rare disease. And if it continues to move in that direction, the business mix, should we expect gross margins to move upwards and maybe to what extent over the next couple of years?

Thank you for your question. I'll answer the first in terms of BD and then turn it over to Steve to talk about cash flows and then also your question on gross margin. So on BD, look, we have -- as you've seen, right, there is strong growth that we've delivered organically. And there is, again, substantial room for growth organically, both across our 2 rare disease assets, Cortrophin and ILUVIEN as well as in our genetics business, right? So we have a strong growth outlook organically. And therefore, for BD, we're continuing to focus our BD efforts on expanding the scope and scale of our rare disease business and are looking at assets. We're at the 1-year anniversary of the Alimera acquisition. And so we're continuing to look for assets, but we're not in a hurry, and we're carefully evaluating what is the next -- right next step from a BD perspective. And again, I'd just like to reiterate that we have obviously, a very strong growth -- organic growth outlook, as you've seen even in the delivery in '25 versus '24. So that's on the BD. And I'll turn it over to Steve to answer the question on cash flows and we can come back to gross margin.

Yes. Thanks, Nikhil. On the -- I guess, on the cash flows, yes, we're very pleased with the cash generation in the first half of the year. And at the moment or near to midterm goal for cash is to continue to accrue cash to the balance sheet and build that war chest as we think about how to reinvest into the business, both organically and through future business development and potential M&A. And so that's our near-term goal. As we continue to generate cash, we can think about debt paydowns in the future. But we have the cash in accounts that generate a decent interest income returns that just acts as a natural hedge to some of the debt instruments that we have out there as well. On the gross margin question, our second quarter gross margin was driven by strength in multiple lines of our business, including the second full quarter of prucalopride in generics, which had the benefit of first-to-market generic pricing, somewhat better-than-expected brands performance as well as the shift in the mix of the overall company towards rare disease. In the second half of the year, that benefit from prucalopride on total company margins will no longer be present given the amount of competitors that entered in late June. And we do continue to expect a moderation of brand performance. We're assuming normalized -- fully normalized quarters of brand performance in the back half. And so those impacts are expected to drive a modest reduction in second half gross margin. And therefore, we're very comfortable in reiterating our full year guidance of 63% to 64% margins for the full year P&L by the end of the year. And under your associated question in terms of how we think margin evolves in the future. We're quite pleased at kind of approaching this mid-60s mark in 2025, and we see that as a very good base for continued growth in the future, both as we manage the mix of our business as well as we continually have projects in place to improve our procurement quite focused on over recent years and have strengthened quite a bit, and we continue to lean into procurement as we manage margins going forward as well as continuing to leverage our manufacturing capability, right? We're very proud of our three U.S.-based manufacturing plants and the capabilities that they provide us, and we're continually reinvesting into those facilities to ensure that we're optimizing margins as we go forward. So Gary, obviously, we don't speak to forward-looking guidance specifically at this time, but we do anticipate evolution of -- positive evolution of our margins as we continue to march forward.

Our next question comes from Faisal Khurshid with Leerink Partners.

Just wanted to ask, you spoke on granularity on what exactly is driving the kind of pretty meaningful inflection to expansion of the ACTH class, like combined with the -- at our results reported earlier this week and your results today as well. Clearly, this class is experiencing a pretty big inflection. And I get what you're saying is that it's just like a huge even increasing penetration a little bit represents a large dollar value. But if you can like pinpoint like -- is it particular indications? Is it particular prescribers? Is it the launch of these easier-to-use dosage forms? Like what exactly is kind of like giving this like very strong growth?

So look, I think in terms of what is going -- and obviously, we've raised the guidance by $55 million for ourselves. And obviously, the competitor spoke about 20% to 30% growth. I mean, from our perspective, in terms of what is going, let's call it, better than anticipated. First, the faster time to impact of the Cortrophin sales expansion by 18 from 52 team members to 70 team members, for our core indications of nephrology and neurology and rheumatology. That's a big -- that's an important driver. Second, the acceleration in the newer indications of gout as well as the revenue synergies in ophthalmology, where we had a 33% increase in volume from the combined sales force, right, that's selling both Cortrophin and ILUVIEN. Third, Chris talked about 70% of our new enrollments have been with the prefilled syringe presentation. And that is more rapid uptake and additional momentum than really what we had anticipated. And lastly, the acceleration of new prescriber addition, right, especially those that are naive to ACTH, who now account for approximately 50% of Cortrophin prescriber base. So look, overall, this is -- it's not any one thing, it's multiple different drivers. And I think most importantly, we've made significant progress in building this high-growth, profitable and sustainable rare disease business since the launch in 2022, and are well equipped to continue tapping into this large TAM and continue to convince newer prescribers to provide Cortrophin Gel to the appropriate patients.

Got it. And then if I can just ask a follow-up on the prefilled syringe. Just to clarify, you're saying 70%, of new patient starts were the prefilled syringe. And then could you also comment -- I know you won't give any specifics around like gross to net and things like that. But could you just comment broadly if the economics around the prefilled syringe are any different to you than the economics on the traditional vial and syringe format?

Yes. So on your first question on the stat that Chris shared in his prepared remarks was that 70% of enrollments in July are for the -- which is enrollment as in new cases initiated were for the -- were written with prefilled syringe. So that's what we said about the prefilled syringe. And then the second, your question on gross to net, I think there's a modest upward pricing advantage on -- in terms of the WACC of the prefilled syringe. I think that's what we'll comment. Obviously, we strike a balance between sharing what is helpful to investors as well as what is competitively sensitive. So that's what we'll share.

We will move next with Vamil Divan with Guggenheim Securities.

This is Daniel on for Vamil. Congrats on the quarter. So a couple of questions. One is sort of a follow-up question on some of the previous ones revolving around the prefilled syringes. So are there any particular specialties that are adopting this presentation more quickly than others, maybe more quickly than you all expected, is there any other additional color you can provide there. And then the second question is on ILUVIEN. So you mentioned that there's continued market access challenges that sort of pushed the full year guidance down here. But can you speak to if the NEW DAY trial resolves had any positive impact on this new guidance? So maybe a differently like positive results partially offset this negative impact on the market access challenges for 2025? Or will you expect to benefit from these NEW DAY results, and the resulting education there to be more of a longer-term benefit?

Thank you for your question. So on the prefilled syringe question, the the ease of use of the prefilled syringe has resonated really with physicians and patients. And so the prescribing of the presale syringe has ramped across indications. So -- it's during the quarter. So it's not one indication or the other, it's really across indications. That's why 70% of the new cases initiated here with the prefilled syringe. So I think that's one. And then on your question on ILUVIEN specific to the NEW DAY. So the overall feedback on the NEW DAY study results have been positive from study investigators and physicians at ASRS. We -- that was last week or the week before. So from Dr. Singer and the study investigators, they appreciated -- a couple of things. They appreciated having the first body of data that's studied the use of ILUVIEN as a baseline therapy in patients earlier in DME, specific data points that we're interested in were different in time before supplemental injection of aflibercept in the ILUVIEN arm compared to the compared to the aflibercept arm and that approximately 30% of patients in both arms of the study did not require supplemental injection as well as the total number of injections needed in the ILUVIEN arm 2.8 versus the aflibercept arm, which was 7 plus. So -- following the release of this data, several next steps are underway. We're preparing additional data presentations at upcoming national and international conferences to further share and contextualize these findings, and we're in parallel, we're actively exploring the potential of including NEW DAY in promotion aimed at increasing awareness and understanding of the study results, especially in earlier DME patients. And I think that, that sort of -- we will continue to use NEW DAY to -- and share and increased awareness of the study results as we move forward. There isn't a specific upside that has been factored into the back half of the year, right, with keeping this in mind.

Our next question comes from David Amsellem with Piper Sandler.

Just a couple of quick ones for me on Cortrophin. First, as the category grows, how do you envision the payer landscape evolving? It looks like it's pretty benign at present. But over time, particularly given the expensive price points here for both products in the category, do you envision potentially a more restrictive environment? Do you envision potentially some at least minor erosion in net pricing? This is more of a long-term question, not a '25 question. So just help us understand your thought process there. And then secondly, I know that you've cited growth across all the various therapeutic categories. But given that the label is quite expansive, are there other clinical settings that you're going to explore or might explore down the road aside from the current therapeutic verticals?

Thank you, Tim. Look, on the payer landscape, remember, we brought competition to this category in 2022 when we launched when there had only been on ACTH auction. And when we went to partner with them right from day 1, so they -- I think that that's the -- that's how we've engaged with them, and we will continue to engage with them as we bring the Cortrophin therapy to the appropriate patients. I'll keep it at that. Obviously, trying to balance what we share what is helpful for investors and what is competitively sensitive. So that's on the payer landscape. And then -- look, in terms of therapeutic areas and focus for Cortrophin. I mean we're currently have significant opportunity that has not been captured in the indications in therapeutic areas that we're in right now, right, across the core indications of rheum, neph and neuro as well as in the newer specialties of gout, palm and ophthalmology, right? And we spoke about the ophthalmology revenue synergies. So in the near term, we're focused on these and there are significant expansion opportunities there, right, substantial. Could we consider other therapeutic areas? Yes. I think we think about it, but I think in the near term, more focused on, there's so much opportunity and so many patients that can benefit appropriately from Cortrophin therapy, that's what we're focused on in the near term.

Our next question comes from Ekaterina Knyazkova with JPMorgan.

Another question on Cortrophin Gel. And I think you touched upon this in the prepared remarks, but just between the growth that you're seeing and your competitors seeing, just any thoughts on how quickly the category role could kind of get back to that $1.2 billion peak that I think we saw in 2017? And has your thinking changed just in terms of how big this category can kind of get over time? And then second question is also on Cortrophin. But just as you look at the category more broadly, are you starting to kind of see physician perception change just in terms of the reason for the product earlier or in different types of cases or different use cases, I think, than previously.

Sure. So I'll take the first question on where the overall category is going. And then Chris can jump in with the physician perception and where it's being used for the category. So look, overall, we believe that the market can go well past the previous peak and remain confident in our ability to sustain robust multiyear growth. Our belief is driven by three factors, right? First, that there is substantial room for expansion in the number of patients on ACTH therapy, right? If I break that down into two parts. Firstly, the number of -- the current number of patients on ACTH therapy are almost half of the patients on therapy at the previous peak in 2017. Second, based on the epidemiology analysis, right, we believe the addressable patient population for ACTH therapy could be many times larger than the previous high. So here, we looked at patient populations by indications such as MS, nephrotic syndrome, rheumatoid arthritis that are refractory or steroid resistance, right? And this is there across indications. So that's the first factor, right, substantial room for expansion in the number of patients. Second, today's ACTH market includes acute gouty arthritis flares, which accounts for approximately 15% of Cortrophin use and was not there in the previous peak. And then third is reason to believe is our ability to expand the ACTH market is that more than 50% of Cortrophin prescribers had never used ACTH therapy before. And with that, I'll ask Chris to answer your question about the -- the use cases and physician percentage.

Yes. Thanks, for the question. And so we think really that's about by specialty, right? So we have really five specialties that all act pretty differently. I'd say focusing on rheumatology just to give you some context, and that's an important specialty for us, for sure. I think one of the dynamics there that we've seen and we've spoken in the past about is the significant impact of the acute gouty arthritis flare indication, with the rheumatology community, to drive utilization and trial of Cortrophin Gel. We've seen that have a big impact on bringing in new rheumatologists to use Cortrophin Gel in their patients with severe persistent gout flares, right, that are very tough to manage. And that utilization has opened the door for other indications in rheumatology that we have. So that one area and one dynamic that where we've -- play and that is really driving growth and kind of new physicians in rheumatology coming to the class. .

Our next question comes from Brandon Folkes with HC Wainwright.

Congratulations on a really good quarter here. Maybe just following on from a number of the prior questions. But sort of when you think about these potential patient expansion of the market that you were talking about here, how do you view Cortrophin's market share expanding over time as these new patients grow the market? Given your success in your prescribers, would you be willing to sort of put a figure out there whether you think Cortrophin could be an equal market share product at peak or even the dominant product in the market at peak? And then maybe just one on granularity. How do we think about the push and pulls in the R&D spend going forward compared to this quarter?

Got it. So thank you for that question, Brandon. So look on the overall market, I think what we're -- as I just mentioned, right, we believe that the market can go well past the previous peak and that the number of -- there's a large patient population that can benefit. So our focus is really on getting this ACTH therapy on Cortrophin to the appropriate patients and not focus on market share because as we spoke about, right, the market grew 27% last year and is on -- if you add our guidance and their guidance -- competitors guidance, it's on track to grow even higher than that. So it's really about growing the market, getting ACTH therapy to the appropriate patients in need rather than anything about share. And about -- with regards to putting a share number out there, that's the balance between investor -- what's helpful for investors and competitively sets this. So we're really focused on growing the ACTH and really the Cortrophin use in the ACTH market. And then your second question on R&D. There is some phasing of R&D that ends up happening almost as the year goes on. So that's why you see a spike in the second quarter, but I'll let Steve add if any other -- anything else regarding phasing of R&D spend, Steve?

Yes. Brandon. Yes, just to remind everyone, as we've spoken in the past, when you think about any of our OpEx lines, the R&D line is the one that can have the most variability quarter-to-quarter. And second quarter R&D was up sequentially versus Q1, consistent with our expectations and consistent with our comments on the first quarter earnings call because first quarter '25 was certainly a bit lower from a run rate perspective from 2025. And if you look at the cadence in 2024, kind of the opposite happened in the second quarter of 2024, I think, was the low watermark. I think it was around $7 million or so. And so point being the spend can be a little bit lumpy because it's highly dependent on the timing of spend, both internally and with third-party partners. And can be dependent highly on when we procure certain materials, et cetera, that get expensed for R&D purposes. When we look forward for 2025, I would also comment, right, we had kind of the culmination or at least the beginning of the culmination of the NEW DAY trial in the second quarter, there will be NEW DAY spend in the third quarter, but that will start to trail off as the year goes on. But overall, we remain very committed to continuing to invest in R&D to drive the mid- and long-term growth in the business, and we have exciting projects going on both in support of rare disease and our generics business.

[Operator Instructions] We will move next with Leszek Sulewski Truist Securities.

I have two. One on the Cortrophin and the second on generics. On the Cortrophin side, can you help us square up the updated outlook? What has driven the disconnect since you last issued the guidance. And your peers saw near 50% growth in the category, how are you able to outpace that? What portion of your growth can essentially be allocated to the new sales team adds? And then just to go back to Brendan's question, are you seeing an uptick in switches and market share gains? And then on the generic front, how are you thinking about new product cadence across generics in the second half and perhaps into next year as a prior exclusivity period comes off, and second, are you seeing any uptick in delays on the FDA approval front?

Thank you. Look, your first question on Cortrophin, we really were raising Cortrophin guidance for the second time in 2025. And obviously, we have raised it by over $55 million from the $265 million to $322 million to $329 million. And in terms of what's been better than what we anticipated. Look, it's the faster time to impact of the Cortrophin sales expansion by 18 from 52 to 70 members. We're not disaggregating how much of the impact from that versus other factors, but that's one factor. The second is the acceleration in the newer indications of gout as well as ophthalmology revenue synergies, rapid uptake in the prefilled syringe presentation, which was the 70% of new cases -- sorry, new cases initiated being in prefilled syringes, that's definitely higher than what we had initially anticipated, and the acceleration of the new prescriber addition, right? The numbers that we had out originally -- earlier was about 40%, but we're at 50% of our prescriber base. So I think it's a number of different factors that is driving the -- and a strong underlying demand, right, on the patient populations that can benefit from it and physicians that are trying it for the appropriate patients. When you -- your next question around -- or sub question around market share, similar to what we set the brand and really we're focused on getting Cortrophin to the appropriate patients and not really thinking about market share and it's -- we're growing, they are growing and I think the increased awareness of the category probably helps both in terms of physicians using it for the appropriate patients. And then on generics, and thank you for asking a question. On the generics business. We continue to have strong R&D execution. So far, we've not seen any material delays in FDA approvals or anything like that. And we plan -- we're continuing, as Steve mentioned earlier, continuing to invest in R&D for genetics and plan to see the continued cadence of new product launches and which is really between that and operational excellence has been the the key drivers of our strong performance in generics, and we see that outlook going forward.

If I may, just 1 follow-up. Can you comment a little bit more on product sourcing for Cortrophin your capacity to fill uptick in demand?

Sure. Thank you, Les. Yes, we have a U.S.-based supply chain entirely and have been planning for this volume expansion and are well positioned with our supply chain to be able to continue to serve the patients in need.

And we show no further questions in queue at this time. I will turn the call back to Nikhil Lalwani for closing or additional remarks.

Thank you, everybody, for joining our call, for running over a little bit, and we're really grateful for your interest in ANI and look forward to continue updating you on our progress as we move forward. Thanks, everybody.

Thank you. This does conclude today's program. Thank you for your participation. You may disconnect at any time.

Good day, everyone, and welcome to today's ANI Pharmaceuticals New Day Study Results Call. Please note, this call is being recorded. [Operator Instructions] It is now my pleasure to turn the conference over to Ms. Lisa Wilson. Ms. Wilson, please go ahead, ma'am.

Welcome to ANI Pharmaceuticals call today for the results from the New Day clinical trial for ILUVIEN. This is Lisa Wilson, Investor Relations for ANI. With me on today's call are Nikhil Lalwani, President and Chief Executive Officer; Chris Mutz, Senior Vice President, Head of ANI's Rare Disease business; and Mary Pao, Chief Medical Officer of ANI. Also joining the call today is Dr. Michael Singer, Clinical Professor of Ophthalmology at University of Texas Health Science Center and Director of Clinical Research at Medical Center Ophthalmology Associates in Texas. You can also access the webcast of this call through the Investors section of the ANI website at anipharmaceuticals.com.

Before we get started, I would like to remind everyone that any statements made on today's conference call that express a belief, expectation, projection, forecast, anticipation or intent regarding future events and the company's future performance may be considered forward-looking statements as defined by the Private Securities Litigation Reform Act. These forward-looking statements are based on information available to ANI Pharmaceuticals management as of today and involve risks and uncertainties, including those noted in our press release issued this morning and our filings with the SEC.

Such forward-looking statements are not guarantees of future performance. Actual results may differ materially from those projected in the forward-looking statements. ANI specifically disclaims any intent or obligation to update these forward-looking statements, except as required by law. The archived webcast will be available for 30 days on our website at anipharmaceuticals.com.

For the benefit of those who may be listening to the replay or archived webcast, this call was held and recorded on July 23, 2025. Since then, ANI may have made announcements related to the topics discussed, so please reference the company's most recent press releases and SEC filings. And with that, I'll turn the call over to Nikhil Lalwani.

Thank you, Lisa. Good morning, everyone, and thank you for joining us. Before we get started, I would like to remind everyone of our disclaimers. Next slide, please. I will kick off today's call with an overview of the agenda and opening remarks, followed by Dr. Mary Pao, our Chief Medical Officer, who will provide brief background on ILUVIEN and its relevance for the treatment for DME.

Next, Dr. Singer will walk through the New Day study design and results. I really want to thank Dr. Singer for his participation in today's conference call and for presenting the data at Annual Meeting of the American Society of Retina Specialists, or ASRS. Also Dr. Singer, I will return to provide closing remarks. And then Chris Mutz, our Head of Rare Disease, Dr. Mary Pao, our Chief Medical Officer, Dr. Singer and myself will take your questions.

So to start, and we can stay on the same slide. So to start, we are pleased to be here today to discuss the results from the New Day clinical trial, which explored the use of ILUVIEN as baseline therapy in patients with early diabetic macular edema, or DME. We acquired ILUVIEN in our 2024 acquisition of Alimera Sciences, and the New Day trial was already well underway at that time.

For context, New Day is one of the largest studies comparing a corticosteroid therapy versus an anti-VEGF therapy arm in the treatment of DME. As we will discuss today, we believe the New Day results further highlight its potential as an important option for DME patients and have the potential to support earlier usage of ILUVIEN as part of and its role in reducing treatment burden in DME.

More broadly, the New Day trial and our other ongoing clinical and scientific studies for our Rare Disease business, at our Retina business are in line with our commitment to generating data to help physicians inform their clinical decision-making. To that end, we will continue to analyze the New Day results and present the full trial data and potentially other analysis in the future to continue to support our customers and the patients they serve.

Before I hand it over to Dr. Pao, we wanted to share a quick performance update on our retina products. These have been 8-K this morning. Our preliminary unaudited financial results for the second quarter ended June 30, 2025 for our retina products, which are ILUVIEN and YUTIQ, the company expects combined ILUVIEN and YUTIQ net revenues of $22.3 million for the 3 months ended June 30, 2025.

Our retina product performance was in line with our expectations. The second quarter was an exceptionally busy one for our team. As we executed on the ILUVIEN launch under the combined label for chronic NIU-PS non-infectious uveitis for the posterior segment of the eye and diabetic macular edema, DME, the transition from YUTIQ to ILUVIEN, which is now done and helping retina practices navigate the recent market access challenges for Medicare patients, all while expanding and strengthening our ophthalmology sales team with experienced reps. And with that, I will turn it over to Mary to share the New Day results. Mary?

Good morning, everyone. Thank you, Nikhil. I'm Mary Pao, I'm the Chief Medical Officer, and thank you, especially to the West Coast people who are joining us so early. We can take a look at the -- this current slide. This is a slide with an overview of ILUVIEN which is the product we're discussing. On the left, if you take a look they're the approved indications. And on the right, you can orient yourself to a high-level description of its mechanism of action, which I'll discuss in a second.

As many of you already know, ILUVIEN is a novel, long-acting intravitreal implant and it releases the corticosteroid fluocinolone acetonide in a constant and controlled manner for up to 36 months. It's indicated for the treatment of appropriate patients with diabetic macular edema DME, which is a chronic disease that causes swelling in the macula eye. DME is actually the leading cause of vision loss in diabetic patients and symptoms can include blurrier double vision, difficulty seeing colors and ILUVIEN is indicated also for the treatment of chronic noninfectious uveitis, which affects the posterior segment of the eye, and we'll call that NIU-PS.

NIU-PS is a long-lasting inflammatory condition in the eye that leads to pain, visual impairment and also results in vision loss. Delivering a corticosteroid to the eye helps inhibit the inflammatory response as the key driver in DME as well as chronic NIU-PS specifically, corticosteroids increased the production of a compound called Lipocortin, what you look at on the right, and that blocks the production of Phospholipases A2. Phospholipases A2 is a compound that drives inflammation with the downstream production of prostaglandins and leukotrienes.

So you see how you're regulating the inflammatory response through all of these compounds. In addition, Lipocortins also suppressed cytokines, which we know are important in development of inflammation.

Next slide, please. So on this slide, we're looking at a high-level view of the treatment journey for DME patients. The guidelines from the American Academy of Ophthalmology or the AAO recommend treatment with anti-VEGF compounds as the first-line therapy. In addition to regular monitoring that can lead to switching to a different anti-VEGF, improve or optimize results for patients with more severe visual impairment or that have a suboptimal response on anti-VEGF therapy guidelines recommend a switch with different anti-VEGF therapy.

An intravitreal corticosteroid such ILUVIEN or laser therapy. In real-world practice, steroids such as ILUVIEN are used by physicians as the treatment of choice for patients who are not well served by anti-VEGF therapy. Why? Because they provide a different complementary mechanism of action focused on the inflammation associated with DME.

On the next slide, we can dig a little bit deeper into the opportunity for steroids to treat patients not well served by anti-VEGF therapy. On the left, you can see we have a column that outlines the various reasons why a patient may have an incomplete or suboptimal response to anti-VEGF therapy. First, the burden of frequent injections can contribute to inferior real-world vision outcomes compared to clinical trials as demonstrated by a retrospective analysis that's shown that there are fewer anti-VEGF injections and poor 1-year visual acuity gains in the real world versus what's shown in the trial.

Second, DME is a multifactorial disease. And so the underlying pathophysiology likely goes beyond just VEGF-driven angiogenesis and likely includes inflammatory hypoxic and hemodynamic processes, which can contribute to the disruption of the blood retinal barrier and the increase in vascular chromability that we see in DME, and those cannot be addressed by anti-VEGF therapies alone.

Third, the disease may be heterogeneous. The variations in genetics and phenotypes such as polymorphisms or differences in gene expression of VEGF that can infect individual responses to anti-VEGF therapy. An enhanced VEGF expression in our pathway redundancy may impact the therapeutic efficacy. Fourth, glucose regulation in diabetic patients plays a crucial role in the effectiveness of anti-VEGF therapy in DME. Patients with higher hemoglobin A1c levels often show a less favorable response to treatment, and it often is seeing that you need tight glycemic control to achieve optimal anatomic and visual outcomes.

Finally, last on this column, access to anti-VEGF therapy can really vary significantly based on a variety of factors that are associated with anatomic, which affects treatment frequency and visual outcomes or disparities based on rates, ethnicity, insurance coverage, access to care and adherence to clinic visits.

On the right, we highlight data that shows the correlation between DME severity and inflammatory cytokines. This study implies that corticosteroid treatment, which suppresses inflammation is positioned as an important treatment for DME, especially for patients that are not well served by anti-VEGF therapy.

I will now happily turn the call over to Dr. Michael Singer to discuss the New Day clinical trial, and thank you, everyone.

Thank you, Mary. So we're going to talk about New Day clinical trial. The New Day clinical trial was really to assess the efficacy of ILUVIEN as baseline therapy. In patients with early DME as well as assessing the safety and tolerability of ILUVIEN and aflibercept in combination in patients with DME.

You can see on the slide that this is the basic schematic. Patients initially were given a steroid challenge because we wanted to treat them on label and with steroid challenges with difluprednate, they were randomized 1:1 to ILUVIEN and aflibercept. The ILUVIEN arm got one shot followed by 4 placebo injections over a 5-month period of time. While aflibercept was given on label with essentially 5 injections, every 4 weeks. And then what would happen during the maintenance phase was to see a supplemental aflibercept were needed.

And the key details the intent-to-treat analysis essentially with everybody in the INSPIRE study population. And we wanted to know for the primary endpoint, the number of supplement delay aflibercept injections that were needed from baseline to week 72. The secondary endpoints that we'll discuss was the time to supplemental therapy from the last injection, the percentage of people who gained 5, 10 or 15 letter ETDRS letters from baseline to week 72. The baseline change in central subfield thickness in the ITT population on OCT and the percentage of patients who did not require any supplemental therapy throughout the trial. Obviously, safety is important. So we track the rates of cataract surgery, the incidence of intraocular pressure and intraocular pressure surgery throughout the trial.

Next slide, please. So in terms of inclusion criteria, you had to be over age 18 with type 1 or type 2 diabetes, you had to have OCT central subfield thickness. And from a vision standpoint, you had to have between 35 and 80 letters initially. What was excluded was patients with history of glaucoma or ocular hypertension, other conditions associated with macular edema patients who had prior laser photocoagulation or grid, patients who had a history of intravitreal or periocular steroids or intravitreal injections of anti-VEGFs, within 12 months, you kind have had 1 within the last 12 months, but you can have 1 greater than 6 weeks.

So essentially had to have it greater than 6 weeks but only 1 in the last year. We talked about the steroid challenge. Let's go in bigger detail that essentially, we gave people the medication. They could not have a pressure rise as greater than IOP or greater than 8 millimeters from screening or they would not be included in the trial. And this was a 2-week course of difluprednate topical drops.

Next slide, please. So looking at the intent-to-treat population, we initially had well divided 154 ILUVIEN, 152 aflibercept, you can see the people who discontinued early, about 30 in the ILUVIEN arm and 34 in the aflibercept arm. You can see the reasons. Overall, you had about 124 people in ILUVIEN and 118 in the aflibercept arm in the total population.

Next slide. Looking at the demographics, pretty well balanced. I mean, the most important thing we wanted to balance had to do with vision and had to do with lens status but essentially pretty well balanced in terms of the age, the genders, the race, the ethnicity.

Next slide. Important for the baseline characteristics, like I said, mean visual acuity is something we wanted to stratify for and that was well put together. Everything else is pretty well stratified as well. I want to bring your attention to the fact that essentially, we did have relatively large numbers of people with a risk NPDR. The other thing that's important in terms of these test study, which is different from other ILUVIEN studies in the past had a very high percentage of phakic patients, which essentially you could see down here. And there were patients who were previously treated for about 10%, which was equal in bolt-ons.

Next slide. So we're going to talk about a second population, that we'll reference was call it post hoc population. The story was not everybody followed the rules for lack of a better word. So again, we look at the post hoc population for people who essentially followed the rules. So the reason we differed from this initial population was patients who did not have a major study deviation. They were randomized and relevant. They met criteria. They got the right -- they've made sure they got the right treatment and make sure they did not receive prohibitive treatment.

There were 44 patients with 73 major deviations that exclude them from the post hoc analysis. Half of these deviations where when patients were supposed to [ read ] the supplemental injection and then. And 1/3 of these patients, patients got supplemental injection and weren't supposed to get it based on protocol guidelines. If you look at the treatment population, what you can see is we dropped it from 154 patients in the ILUVIEN to 128 and 152 aflibercept to 134. Then you look at this population in terms of who discontinued early, your overall completed study population is post hoc was pretty balanced at 103 and 104.

Next slide. So looking at the demographics, essentially well balanced just like the ITT population in terms of patient demographics.

Next slide. In terms of baseline characteristics, same thing as well, very well balanced in terms of vision, IOP, ETDRS letters and DRSS scale. Next slide. So the primary endpoint, so the primary endpoint, it turns out you needed less supplemental injections in the ILUVIEN arm versus the aflibercept arm, However, it did not reach statistical significance. What they reach statistical significance, which is probably more important, is the meantime the supplemental therapy since the last injection was 185 days in the ILUVIEN arm and 132 days in the aflibercept arm and that P-value is highly statistically significant. And about 30% equal groups had no need for rescue therapy throughout the trial. Important to understand that although there was the numbers of the mean number of supplemental injections with 2.4 and 2.5.

Remember that the aflibercept group got 5 injections as a head start being treated on label. So if you add them together, essentially, you're looking at around 3 injections in ILUVIEN and 7.5 in aflibercept.

Next slide. Looking at the per protocol population, we -- in the groups that actually followed the rules, there are mean number of supplemental injections was statistically significant with in 1.8 supplemental injection meeting ILUVIEN arm and 2.5 aflibercept arm. In terms of time to last injection, just like in the ITT population, it was highly statistically significant with 189 days in ILUVIEN versus 131 days in aflibercept.

And again, looking at the total number of injections throughout the study the ILUVIEN arm needed 2.8 while the aflibercept needed 7.5. Because remember that aflibercept had head start with 5 extra injections.

Next slide. So secondary endpoints, in terms of visual acuity, it was a 4 letter non-inferiority margin, which we met the 4 letter of non-inferiority margin. If you look at the people who essentially who weren't rescued, this 4 letter group actually got even smaller for patients who actually didn't need rescue. One of the things we wanted to figure out was, was there a difference between having lens status or not. Because in other steroid studies, there was a difference. And it turns out whether you were phakic at the start, pseudophakic at the start or pseudophakic and after -- during the course of the trial, meaning a cataract surgery, none of these trends seem to have any difference on visual acuity.

Next slide. Looking inside 5, 10 and 15 letter gainers, you can see there's an equivalent number of each group that were able to hit this marks with essentially 11.5% in ILUVIEN versus 10.3% in aflibercept. 23% versus 29% in 10 letter gainers or 2 lines and 41% versus 49% in 5 letter gainer. So important to understand that both of these medicines were very good at improving vision, regardless of how you measure it in terms of 5 or 10 or 15 letter gainers on the ETDRS chart. And this is the entire ITT population.

Next slide. Looking at central subfield thickness, the overall graph on the left shows that the mean central subfield thickness over time, so it's an interesting trend. The trend is if you give aflibercept arm label where you get 5 shots, aflibercept initially dries the retina better than ILUVIEN. But over time, the ILUVIEN group patches up. I look at this kind of like the hare and the tortoise. If you look at the change in BCVA over time, you see the same thing. So when you look from month 9 on in any of the 3 graphs you see, what happens is ILUVIEN actually catches up and drives the retina numerically better than aflibercept, whether you look at the overall mean change, whether you look at mean CST or you look at essentially the people who were nonrescued. All the trends are the same. And this makes sense with the mechanism of action that Mary explained before because of the fact that, steroids take care of inflammation and inflammation are usually later than the VEGF effect. This is where steroids really hit their stride is over time, which really works well with the fact that this is an extended release medication.

Next slide. In terms of safety summary, safety essentially a little more safety issues with the ILUVIEN group, but nothing that really drives you out. Next slide. This is the overall systemic safety effect no major things that you see that favor one or the other.

Next slide. Looking at ocular systemic -- ocular treatment-emergent adverse events the reality was that there were more patients with cataracts, which should be expected, given the fact that this is a steroid. This cataract surgery essentially happened later in the process. But overall, cataract potentially is a curable thing. It is something we wouldn't expect typically when we give patients steroids.

Next slide. The other thing people worry about with steroids is increase in ocular pressure and you could see any patient that had any IOP event with 15% in ILUVIEN versus 3.2% aflibercept breaking into buckets, which I like to do, you have about 2.6% of an IOP greater than 10, 11% greater than 25. And the 1.9% greater than 35.

Next slide, important to understand what happens to these people. In terms of any surgical procedures, there was 4.5 incidents of any surgical procedures. When we talk about surgical procedures we have laser and incisional surgery. Lasers for both SLT and PIs. And that was 2.6% in the ILUVIEN Group in incisional surgery was 1.9% in the ILUVIEN Group, which essentially is consistent with other trials or maybe even a little bit better.

Next slide. So in summary, the mean number of supplemental injections favored the ILUVIEN arm, but did not hit statistical significance. But in terms of secondary endpoints, well, this is a statistically significant increase in the meantime from last injection in the patients with ILUVIEN of 185 versus 132 days, highly statistically significant. The visual acuity and anatomic changes were right within the non-inferiority arms and essentially 1/3 of the patients who were able to remain supplement pre -- actually in both arms, and so similar safety in terms of cataract an IOP and previous fluocinolone trials with no retinal detachments or endophthalmitis in the ILUVIEN arm.

And then looking at the per protocol population, it showed a statistically significant in a mean number of supplement injections favoring ILUVIEN versus aflibercept and a lower total number of total injections needed, which is 2.8 versus 7.5 and a lower number of injections actually regardless of whether you look at ITT or per protocol population.

Next slide. I want to turn this over. I want to thank the -- all the investigator sites and patients who really made this possible, and I want to turn it back over to Nikhil.

Thank you, Dr. Singer. The New Day results position ILUVIEN as an important option for DME patients. We look forward to sharing the results with Retina Specialists and the ASRS meeting and beyond as part of our broader strategy to position ILUVIEN for long-term growth. In the near term, the New Day results provide an important opportunity to engage and educate customers on the key learnings from the trial, including the potential to support earlier usage of ILUVIEN and its role in reducing treatment burden in DME.

Longer term, we also plan to share additional analysis from New Day over time. We announced our preliminary unaudited financial results for the second quarter ended June 30, 2025. The company expects combined ILUVIEN and YUTIQ net revenues of $22.3 million for the 3 months ended June 30, 2025, which is a 38.5% growth over the first quarter 2025 of $16.1 million. Our retina product performance was in line with our expectation. And in closing, I again want to thank the New Day study sites, patients and investigators for making this trial possible.

With that, operator, I turn it over to you for questions.

[Operator Instructions] We'll go first this morning to Gary Nachman of Raymond James.

That was really helpful. First, I guess, for Dr. Singer, just how do you think of the relative benefit of having fewer injections with ILUVIEN versus the increased incidence of cataracts and IOP that you see. So maybe explain more what the issue is with a large number of injections and why you would want to reduce that as much? And what portion of your early DME patients you think you would want to transition them to this new type of approach?

Okay. I'll start with the beginning of the question, happy to answer. So essentially, why do we want something that's an extended duration medicine. If we look at diabetic patients, they are notoriously noncompliant and essentially understanding your diabetic patients with the general rule, a lot of them are working age. So if we look at the data, this data that came out, looking at the number of doctor visits that these patients go to who have diabetic macular edema over the course of the year, they have 25 inject -- visits to lots of specialists.

And the time they get to you as a retina specialist is actually not very many visits and eye doctors in general have 4 visits. So the fact is you're not going to get as many intravitreal anti-VEGF injections and as you particularly want. So having a drug that essentially works over time, it's very valuable in this patient population. And I've written a number of articles about how noncompliant diabetic patients are that being said, we can use this.

Now, IOP and cataracts are well known, especially my feeling about cataract is interesting. If you're an older patient, cataract is the inevitability and it's sooner in diabetic patients. So we talk about cataracts. And one of the things that understand is that the vast majority of patients who get intraocular pressure elevations are well controlled with topical medicines. It isn't a first-line therapy. Anti-VEGF will continue, but the thought is there is -- if you look at a number of studies, including an analysis of Protocol T, which is the DRCR network, they showed about 25% of people were sent to a nonresponsive to aflibercept, which is at the time the strongest DME medicine that was tested in this one-to-one comparison with aflibercept, ranibizumab and bevacizumab.

So you've got 25% of your population that are essentially inflammatory-driven more than VEGF-driven, having something that fixes that really has some great value. And that's something that's long duration as you look at all the other plays, everybody is trying to play in the long duration race, look at the TKIs and everything else. This is a medicine that has a proven track record that you could see even in this trial, 30% of people was a were one and done.

And just to build on Dr. Singer's response, Gary, and good morning, and thank you for joining us. Look, we reported the safety data from the New Day in our presentation this morning. And in general, ILUVIEN was well -- very well tolerated -- was well tolerated in this trial. With a safety profile that is consistent with data from prior ILUVIEN clinical trials and real-world views. And we also believe New Day generated clinically meaningful safety data, including additional data around the IOP increase events in patients who passed the steroid challenge.

And notably, this is the first prospective steroid trial to use a standardized topical steroid challenge in the protocol, the difluprednate that was given 4 times daily for 2 weeks prior to visit to.

Okay. That's helpful. And then just Dr. Singer, what portion of your early DME patients would you want to transition over potentially? Is it a significant portion of patient group.

I mean I think the people that are nonresponsive will be the people that I would do. And what I typically do is I try people with anti-VEGF medicines first. If I look like I'm not making any headway I'm going to start looking at steroids. And I mean I have an algorithm that I look at people that essentially, if I give you 3 anti-VEGFs and we're not making any that many progress, I'll give you -- after the fourth injection, I'll see you back in 2 weeks. If I don't see a 50% drying, okay, then I know it's basically inflammatory driven, and that's where I'll start using steroids.

The good news is that by starting in earlier, I'm going to have a higher potential to maintain or increase the vision they have at a much higher chance of making sure they stay compliant. And as you can see from the OCT data that over time, they're going to get even drier than they would have with their anti-VEGF because this population is really inflammatory driven as opposed to VEGF driven as Mary talked about today.

And Gary, if I were to just to build on what Dr. Singer said. As previously communicated, we had identified a target addressable market of over 50,000 DME patients, specifically those with a suboptimal response, as Dr. Singer was talking about following treatment with 2 or more anti-VEGF agents and who've been previously treated with corticosteroids. This estimate is obviously based on -- the estimate was based on a combination of epidemiological data and quantitative market research.

So we believe the findings from the New Day study further confirm and validate this TAM reinforcing the clinical relevance and unmet need within this specific patient population. And what it does is that we believe that this data reinforces our confidence, and our ability to capture more of the TAM of 50,000 DME patients. Remember, where ILUVIEN is being given to less than 5,000 patients today on a yearly basis. And at this point, we not speaking about the broadening of the TAM because we're at less than 5,000, we're out of 50,000, right so.

Yes. Okay. And then just another follow-up. Just there were a bunch of these protocol deviations. Just curious what was the biggest issue overall with those patients leading to the deviations. And do you think you need to show the per protocol results for it to be compelling enough? Or is the ITT enough? And then Nikhil, maybe just talk about how you're going to promote the data, the physicians? And how long do you think it will take for some of the retina specialists to adopt this?

Right. So why don't I take these and then I can help from my colleagues as needed. So look, on the per protocol population, so upon -- we identified a total of 44 out of 306 patients who had major protocol deviations, which potentially can found in the analysis of the data, which is why we shared it. And those 44 patients experienced 73 major deviations that were excluded from the post hoc patient population analysis. And half of those deviations were cases in which a patient did not receive a supplemental injections when they should have and 1/3 of those deviations were cases in which a patient received a supplemental injection but they should not have.

Look, the post hoc analysis was conducted on the remaining subset of patients, so 128 and 134 the per protocol population. So that's the answer to that question. Look, the New Day study results are being shared going to your -- I think your first question, the New Day study results are being shared with ASRS attendees through a presentation today, a paper on-demand presentation today. And we've added discussions, as you would expect, with some of the investigators, including Dr. Singer, their feedback has been that the New Day study may support -- provides additional data that may support treating early with steroid implant, sorry, and has the potential to benefit patients with DME.

And then I think your other question was around what are we doing with this data? So following the release of this data, several next steps are underway. We're preparing additional data presentations at upcoming national and international conferences to further share and contextualize these findings. In parallel, we're actively exploring the potential of including New Day data in promotion, and that increasing awareness and understanding of the study results, yes.

Okay. So are you still comfortable with the full year guidance for this year? You gave the 2Q sales, are you reaffirming that today for ILUVIEN and YUTIQ?

Yes. We look forward to providing an update on the guidance for the total company and the specifics cuts that we provide, including rare disease, generics, et cetera, at the earnings, which is in a couple of weeks.

We'll next go to David Amsellem of Piper Sandler.

Just a quick one for me. For Dr. Singer, as you think about the anti-VEGF competitive landscape, it's certainly a more varied landscape. You have a number of anti-VEGF option that implantable. So to your point about duration. And so I guess my question here is there is the data that you presented, but I guess, how do you -- where the dominance of anti-VEGFs and the fact that it is a more varied anti-VEGF treatment landscape, so there's more product offerings and more options compared to, say, 5 years ago with how do you square that with trying to win over hearts and minds regarding earlier usage of the long-duration corticosteroids.

So that's my first question. And then secondly, I guess, I'm struggling with how you can leverage post hoc analysis here to drive more usage or earlier usage of ILUVIEN. And I'm just kind of wondering how that kind of data is going to be received by your peers in the community?

So let me start with the first question. Thank you for asking. So basically, yes, there are a number of anti-VEGF medicines out there. But -- and just understand that I've been involved in all these trials. So the reality is that they all essentially with the exception of one of them really target VEGF. So it's the same pathway. We may have stronger medicines. We may have longer medicines. But again, we're still looking at that proportion of patients that are VEGF receptive.

And that's about 75% of people based on that protocol T analysis I told you, and everyone's joking for that process. And even the faricimab product, which essentially is Ang2 does not affect a lot of these inflammatory factors that Mary showed you in the Slide 4. So the story is that people know inflammation is an issue. What we wanted to know is how well does it stack up? What's interesting to understand is that New Days, everybody wants to see New Day because New Day gave everyone a fair shot from scratch. A lot of the steroid trials and I've written on most of those articles were people who were previously treated.

So looking at patients square understanding in the background that most of DME 3/4 is VEGF-driven. New Day held its own relatively well because of the fact that it's a one shot versus 5 shots of aflibercept. So in a race that was really stacked against ILUVIEN, it's still pretty much held its own. And then we're going to talk to doctors about that. And doctors do believe that there's more than VEGF in the process. And to your point, as more medicines come out and they talk about new things that are on the horizon, people are realizing that DME has inflammatory factors and that steroids still do a really good job of controlling them, and they have a relatively safe, good safety profile.

I mean, as the steroid challenge really decreased the number of people who needed incisional surgery. And the laser surgery which I didn't spend a lot of time was, half of those weren't really due to increased steroid-induced intraocular pressure, PIs are not used for that. So the data is probably really better than before. I think there's a value in that. In terms of your per protocol population, obviously, doctors always kind of go, well, the post hoc analysis, they'll have a little bit of skepticism what I think was really interesting is regardless if it was at the ITT population or the per protocol population, the time from last injection was highly statistically significant.

So the duration play really stays strong. And if you look at all the TKIs that are being and the gene therapies that are being introduced to our landscape, they all played in the fact that they last longer. Nobody really says they're stronger, they last longer. Well, this medicine is approved. It's been out for a while, and I know this is [ CMO ] medicine. I've been involved in those trials. That's a surgical procedure. This is a simple intraocular injection that people have been doing for the last 10 years. Now we're getting it validated that it really can hold its own again the anti-VEGF and in a good pop set of population where VEGF isn't working, just we should start this earlier because we'll be able to keep the vision better and maintain the anatomy sooner.

Yes. And thank you for your question. I think just 2 things to build on what Dr. Singer said. One, that steroids are the treatment of choice for DME patients that are not well served by anti-VEGF therapy and Dr. Singer put out some numbers about total DME population and what percentage are served by the menu of anti-VEGF therapy that's available. So that's one.

And then the second is what this study was evaluating was looking at -- as assessing the efficacy of ILUVIEN as a baseline therapy in patients with early DME, right? So -- and assessing the safety and tolerability of ILUVIEN and the aflibercept in combination in patients with DME. So there's no -- there's a clear understanding that anti-VEGF is the first-line therapy. What we were exploring with the New Day study is the efficacy of ILUVIEN as a baseline therapy in patients with early DME and using a multimodal approach to treatment as is done in several therapeutic areas.

We'll go next to now to Faisal Khurshid of Leerink Partners.

Nikhil, can I ask you just kind of clarify? Do you believe this data is fileable and could support a label expansion for ILUVIEN? And then a follow-up question to that, is -- where is ILUVIEN use mostly today? And do you expect that to change based on this data either from just like scientific dissemination or from potential label expansion?

Yes. So following the release of this data, which happened today, several next steps are underway. We're preparing additional data presentations at upcoming national and international conferences to further share and contextualize these findings. And then in parallel, we're actively exploring the potential of including New Day in promotion -- New Day data in promotion that's and that increasing the awareness and understanding of the study results.

And then going back to your -- actually going to your second question, look, we've always talked about there are 50,000 DME, 53,000-ish of 50,000-plus DME patients who show suboptimal response following the treatment of -- with 2 or more anti-VEGF agents and show positive response to steroid trial and we're treating less than 5,000 patients with ILUVIEN today.

So this data, largest prospective trial, we believe that these findings further reinforces the clinical relevance and unmet need within this specific patient population. And our ability to capture more of the 50,000 DME patients and even earlier. We're at less than 5,000 out of 50,000 to start with. So.

[Operator Instructions] We go next now to Les Sulewski of Truist Securities.

Dr. Singer, just for you, what would you say the real-world data is more -- of the ITT or the PP DME patient population? And then second, does coverage or copay assistance influence your treatment with ILUVIEN? And then lastly for Nikhil, perhaps on the $22.3 million guide for 2Q, what portion of that or any sort of allocation that you can attribute to the new sales force transition?

Why don't I take the -- thank you for your question. Why don't I take the -- your third question, which is the -- $22.3 million revenues in is Q2 the preliminary results we shared, how much of that was due to the strengthening of our sales force. We're not disaggregating the impact between different elements. The second quarter, we executed on the ILUVIEN launch under combined label, right, chronic NIU-PS and DME and we transitioned or YUTIQ to ILUVIEN and help to retina practices navigate some of these market access challenges that you just spoke about, all while expanding and strengthening our ophthalmology sales team.

So we had most of our, let's call it, open position still, obviously, and have strengthened our sales team. So it's a combination of different elements. That played into the performance. And then I think you also asked about the -- I guess your question was coverage and copay impact to Dr. Singer. So Dr. Singer I'll turn it over to you.

Yes. So I mean I can -- well, we can talk about that. I mean, I think the chronic disease been obviously, affecting everybody. So we're all worried about the process. But I will tell you, given the medicine that lasts that long, the hope is that you don't have to keep going back to the chronic disease well as you would for anti-VEGF all the time. And that's -- and certain people get -- they get funded and then defunded, you only have to do this once and if you get it at the right time that works, which would be nice.

Your other question was ITT versus post hoc, People want to know how this one of the rules. So any -- I mean, again, I referenced this earlier. Both populations had a statistically significant increase in time from last injection versus aflibercept, which really fights the fact that either way you do it, it is a good duration medicine, so it plays at a duration play. So I think that's really important. But I mean, obviously, people will look at it and say, people don't follow the rules. So if you do it right and you follow the rules, you should have very few rescues, and you should be able to essentially have good vision because essentially, we talked to people who weren't rescued that was in your, essentially a version of your per protocol population and the CST that these people hold their own in a disease where they don't have a pre-VEGF starting point.

What's interesting about New Day, I don't think I really said this is the first ILUVIEN trial that essentially went against an anti-VEGF competitor. If you look at the previous trials for approval, they didn't do this then that's always been one of the criticisms that people had was whether with OZURDEX or ILUVIEN, basically the MEAT and FAME trials went against placebo. And to be honest, so did a good number of the original anti-VEGF.

This is a really good head-to-head trial, which essentially showed that it held its own against anti-VEGF. And even though it won't be used initially as a first-line therapy, you can feel pretty confident that it's going to do a good job in thinking about treating it earlier, will actually make it earlier in people's thought process. Hey, look, this -- if I'm not getting anywhere, why don't I change course sooner rather than later?

I appreciate the color, Dr. Singer. Maybe you can just kind of build up on that as a follow-up. In the real world scenario, would you say, most physicians are representative of the ITT or the PP patient group? And then how would you kind of go about in future learnings around that physician group?

I think most people are in the -- I'm sorry.

No, no, please go ahead, Dr. Singer.

I mean I think the per protocol is people following the rules. I mean, people understand when people need to be treated versus when they don't need to be treated. And again, I can't comment to the 43 people what motivated to do what. But understanding that people do with best case scenario, again, the difference -- there was a difference. If you follow the rules, you probably need less shot. But again, any way -- what's important is any way you slice it that if it's really going to last much longer than aflibercept. It's worth thinking about because again, everybody knows DME patients are chronically noncompliant. And that's there are many. And then the less shots you give, I'm sure is written 1 million articles to reference today. If you don't give shots, you don't get vision. This is one shot and you're pretty much good for it.

And just to build on that, sorry, Dr. Singer that I interrupted you. I was just trying to share that, we do have feedback as we shared these results with the -- with some of the other investigators, right, that have been involved with the New Day study and data feedback has been just looking at both sets of data that the New Day study may support trading early with steroid implants that has the potential to benefit patients with DME and just giving you feedback from some of the other investigators have seen that have seen the more detailed data.

We'll go next now to Brandon Folkes of H.C. Wainwright.

Maybe Nikhil, first up from you. You talked about the sort of 50,000 patients and the 5,000 today. So maybe just twofold on that. What's the patient profile beyond the 50,000 you expect to potentially benefit from ILUVIEN near term based on this data? And then, does the sales force detail change at all? Or is the focus remaining on getting that 5, 000 up to the 50,000? Or did that happen simultaneously?

Yes. Thank you for your response. I think that the -- in terms of the -- we -- I guess your second question, which is -- no, your first question in terms of the epidemiology, of the 50,000 is patients that have tried more than 2 anti-VEGF and show positive response or showed suboptimal response, sorry, to more than 10 -- more than 2 anti-VEGF and then show positive response to steroid trial. When you compare that with the patients that were included in this trial, these were largely treatment-naive patients, right, VEGF naive patients or I think as we went through the study and Mary, you can help me there are patients that had not taken an anti-VEGF I think, in the prior 12 months.

So the patient population is much earlier in the DME patient landscape. And that's why you're seeing these results. And as I just spoke about, that it's looking at assessing the efficacy of ILUVIEN as a baseline therapy in patients with early DME, so multimodal early DME? And look, in terms of the sales force, and we just have to be thoughtful about that because -- following the -- obviously, the sales force can only speak to what's on the label. Following the release of the data, several next steps are underway.

We're preparing additional data presentations at upcoming national and international conferences to further share and contextualize these findings and we're in parallel, actively exploring the potential of including New Day data in promotion aimed at increasing an awareness and understanding of the study results.

And one follow-up, if I may, just for Dr. Singer. As we think about potentially using ILUVIEN in these earlier DME patients, you talked about sort of the treatment burden and sort of having these patients come back. But how do you balance potentially a treatment that could go -- could be effective for 185 days. But -- when do you want to see those patients back after giving them ILUVIEN and how often, just given the adverse event profile? How do you monitor that adverse event profile in practice in terms of getting those patients back off?

Essentially, what you would do is the way typically, you follow these people is you're worried is you want to make sure you want to catch the small number of people who have really high IOP rise. And I've actually written a number of articles talking about this, including YUTIQ as well. What's nice about this is they fall into buckets. And essentially, what we tell people in general, which is a good idea is we have them every 3 months for a safety check, which is understanding.

So we bring them in, make sure everything is going well. And the good news is based on the data that whether you as the retina specialist or lower level provider can do a safety check by checking the pressure that's when you typically want to see these people every 3 months. It's just a good rule of thumb -- this is based on the fact that we showed you from the mean change in terms of time that you -- that essentially, they're not going to need a whole lot of supplemental therapy in the first 6 months, which is really great.

And that kind of differentiates itself from a lot of the other therapies that are out there that are going to be implants going down the line so I think there is great value in that. The cataracts are going to happen much later. We didn't fill that in, but it turns out that's closer to 1.5 years. So that's really not a problem that people worry about. What keeps people up at night is to know the pressure. And if you have an idea when to follow these people, you'll catch them, you'll put them on therapy if they need them. If not, they can keep living their life and they won't have to be coming back every month for shots.

And Mr. Lalwani, it appears we have no further questions this morning. So I'd like to turn the conference back to you for any closing comments.

Thank you. Thank you, everybody, for joining our call this morning to share the New Day study results as well as provide a preliminary unaudited financials on the ILUVIEN and YUTIQ Q2 revenues. We look forward to updating you further at our Q2 earnings call that should be coming in a couple of weeks. Thanks, everybody, and have a great rest of your day.

Thank you, Mr. Lalwani. Again, ladies and gentlemen, that will conclude the ANI Pharmaceuticals New Day study results call. Again, thanks so much for joining us, everyone, and we wish you all a great day. Goodbye.