BioCryst Pharmaceuticals, Inc. Aktie

Okay. Good morning, everyone. I'm Jason Russell from the Morgan Stanley banking team. It's a pleasure to welcome Charlie Gayer here from BioCryst, he is a "newly appointed CEO of BioCryst." I think you took the job on January 1 of this year. We're excited to have BioCryst here. It's obviously very topical given some of the recent news, and I think we'll get into that. So Charlie, thanks for being here.

Thanks, Jason.

Maybe just to set the stage for a minute. So as I mentioned, you started as the CEO a long time with BioCryst, started as CEO at the beginning of this year. Kind of feels like BioCryst is entering a new chapter. Obviously, ORLADEYO, which is the underpinning of the business, is a scaled commercial franchise, generating operating profit. You took the step to bring in another asset with navenibart just a bit ago, which adds a second modality in HAE.

We'll get to -- you have another data point coming towards the end of this year with BCX17725. And you also just took moves on your own perspective on how you're going to drive the pipeline forward from here. So maybe with all of that set the stage, let's think about your vision. How is the vision for BioCryst potentially evolved? And is that the result of kind of the maturity of the business or other things on your mind? Maybe just set the stage for us so to start.

Sure. Absolutely. And before I start, I'll be making obviously some forward-looking statements, and those statements have risks, which you can learn about at our website. For those of you who are not as familiar with BioCryst or who maybe were at some point in the past, BioCryst has been around for 40 years, but we're at a very different stage right now. So it's a different company. For most of that time, we did everything internally, in-house discovery, and we always had some good science and that got us our drug ORLADEYO.

But this year, we made a decision to pivot away from internal discovery because we've become a profitable company. And we think the best way to go forward is through external innovation to build on the success that we have with ORLADEYO, which we'll talk about more and to build a broader rare disease company. So as we look forward a few years, say, to the end of 2030, 4 years from now, we see us with not just ORLADEYO and navenibart on the market, but probably a third product, well over $1 billion in revenue on a very stable cost basis, growing profitability significantly, which we can then plow back into building a broader pipeline through external innovation. So we're really excited about where we're at, the strength of our business and what we've got going in front of us.

Great. And there's so much to unpack here. So maybe just to hit the evolution on the planned pipeline point first. You made a decision to shut down some long-standing capabilities around internal discovery, you just mentioned. It sounds like you're not retreating from building the pipeline. What changed in your thinking to make that decision? You mentioned the profitability aspect. And which capabilities do you think are core to keeping at BioCryst that do make you differentiate?

The big reason we made that shift is despite our past success, we realized we can just do more by looking at the broader opportunities out there in rare disease when we just weren't big enough to do enough internal programs. And so balancing the cost, balancing the probability of success, we can do more externally. And so this year, I've been able to build a really strong team. Dr. Sandeep Menon, who's here in the audience, joined as Chief R&D Officer earlier this year with this shared vision of building a pipeline through external innovation.

We added David Jenkins as our Chief Scientific Officer, came over from Ipsen over the summer. And we're building other scientific leaders. So we are not pivoting away from science at all. The science we want now is to help us look at this broad set of opportunities out there and find things that we really believe in, limit our risk in what we acquire and build a pipeline that way on our growing cash flow.

Great. So pull the thread, you've already taken a step. You acquired Astria, which brought in-house the navenibart. I assume you would agree that, that's a case study for how you want to think about building out the franchise going forward.

I mean Astria was, I would say, a perfect example, not necessarily the example of what we'll do every time. I mean to find something in a space where we know so well in HAE, we probably never will find something exactly like that again. But the benefit of Astria and navenibart, you've got a late-stage asset there. So we're well set on the late-stage side. And the next things that we want to do are balancing our pipeline going earlier. So kind of Phase I, Phase II assets to complement what we already have. And in the near term, I think that's going to be much more affordable for us as well.

Okay. Great. So let's get into ORLADEYO. It's a franchise that launched over 5 years ago. I believe 2025 was your strongest year as far as new patient adds. And so far this year, you've seen similar trends. It's kind of an unusual trajectory in some sense. And for rare disease, you often see these more hockey stick kind of launches. HAE is obviously a very unique market, a competitive market as well. And so I guess what is -- what are the factors at a high level we'll pull the - peel the onion back here a bit. But what are the factors that have continued to drive demand and allowed you to grow the franchise sitting here almost 6 years post launch?

HAE is, it is kind of a unique space. I think it's an incredible rare disease success story. The fact that you've got for a patient population of roughly 10,000 patients in the U.S., there have already been 11 branded products approved and I think another 5 or 6 in late-stage development, which is amazing. It comes down first to the product, so to have a differentiated product. ORLADEYO is the only oral prophylactic product in the market and has been for the last 6 years. And so started there, but then it really comes down to the evidence around the product.

And with all the options that patients and physicians have, the #1 thing that they want is to control HAE attacks, as you can imagine. So efficacy is super important. And what we've been able to show over time is how well ORLADEYO works for most patients. And so when patients start on ORLADEYO, 60% of them make it to a year. And that's because they're getting really good efficacy. So it's not a drug for everybody, but it's one that works really well for the majority of patients.

And then the last piece is just how our team operates. We -- from the very beginning prior to launch, we knew we were the small guys coming into -- coming up against some really big competitors. And so we put a lot of emphasis on the skill sets of the team, the data that we collect and the need to generate long-term real-world evidence, which is what's shown how -- shown to the market, shown to physicians, to patients, very importantly, to payers, how well ORLADEYO has behaved in the real world. And that's been a big part of our continued growth and success.

So let's pull on that further. So what is it that the physician -- what are the specifics of the physician observations, behavior as they've gotten more experience prescribing ORLADEYO to their patients. What are those tangible things that they see that perhaps are different than what we knew 6 years ago?

Physicians start with -- it's nice to have data, but what's really important to them is their personal experience. And what I always say about HAE treaters is the great majority of HAE treaters in the U.S. are allergists and immunologists, but the majority of allergists and immunologists don't treat HAE. It's a special group who've decided to do this. And so you end up with physicians who are expert in their area. They may have 5 HAE patients, they may have 20 HAE patients. A few of them have even more than that. But they develop experience within their patient population.

And as they've gotten used to prescribing ORLADEYO, they've seen what I described. They see that it works really well for most of their patients, not every one of their patients. And then we've been able to feed back the real-world evidence on hundreds and now thousands of other patients to them that confirms their experience. And then they also see how we, as a company, work with their patients to make sure they have access to make sure that, that is never a problem for patients. And all of that leads to confidence in the drug and the company. And I think that's why we're still having our best demand ever this late post launch.

So that's helpful color. I mean, back to the demand side. I mean, HAE, I assume you would agree with the statement that if you have HAE, you know it. Is that a fair -- I mean, do you have to go find these patients?

Somewhat. HAE is a pretty mature market. It's still growing though. And you would think that the first HAE product launched in the U.S. back in, I think, late 2008. It's changed a lot since then. A lot of patients have come out of the woodwork because of the availability of therapy. And you're still hearing stories about even classic type 1 and 2 patients being diagnosed even as adults. Another big area -- 2 big areas of growth in the market. One is patients with normal C1 inhibitor, which in the United States was a large population searching for answers and they didn't really have the evidence.

A lot of doctors didn't believe in it. We've been able to provide the evidence in the real world again, how well these patients are doing, and that's been a big part of growth. It's over 1/3 of patients on ORLADEYO at this point. And then I think the next frontier of growth is talking about kids with HAE. So we recently got the indication for HAE for patients 2 to up to 12 years old with a different formulation, a pellets formulation versus the capsule. And having an oral for these kids, you can imagine, is huge because injections and kids don't mix well.

And what we believe is it may lead to a transformation of how kids are treated. Classically, it was thought that maybe kids with HAE didn't become symptomatic until puberty. I think what the experts are learning is more of these kids were symptomatic than they realized. And an oral therapy may help unlock that. And it's early days. We just launched at the beginning of -- launched the product at the beginning of August, but we're seeing demand that's ahead of our expectations. And we're excited about how that's going to help kids grow up differently and also the halo effect beyond that because, of course, it's a genetic disease.

Got it. And maybe just to frame it a little bit more, so you effectively have prophy versus on-demand, you have oral versus injectable. Where -- you've obviously pushed the market a lot to a significant share to the oral market. What are the dynamics on acute versus prophylactic today? And how are those evolving?

Over the last -- so I've been in the HAE space for over a decade now. And in that time, I've seen the use of prophylaxis more than double in the patient population. So at this point, it's about 80% of diagnosed and treated patients are being treated with prophylaxis. And despite some advances in acute therapy, what we hear from doctors and patients is the goal, and it makes sense, the goal is to prevent attacks. And then most patients have occasional breakthrough attacks. And so it's -- you always need a rescue medicine. Patients, despite recent introduction of an oral acute therapy, patients aren't moving backwards. They're welcoming that, but they really want to prevent attacks. And I think that, that's going to continue in the future.

Okay. So just to round this out on the patient experience, we talked about kind of the real-world evidence, and I appreciate all of this is tied together. We talked about it from the physician perspective. If you -- I know you gather a ton of evidence from patients directly in surveys. I think there's an annual survey that you do with the patients. What is the kind of rank order #1, 2, 3, you would say, of like preference from a patient of what they're most focused on?

At this point, it does come down to efficacy for patients at this point. I think if the market had evolved differently, if an oral drug were the first thing on the market, then maybe the vast majority would be on an oral. But already, the majority of patients on prophy are on an injectable therapy, and they're doing well. And so what they always worry about is as much as I might like an oral, I don't want to sacrifice anything. You got to have efficacy.

#2 is safety is always in there, too, particularly at this point where patients have options and experience. Nobody is going to make a trade-off where they're worried about safety. And then modality becomes important after that. So independently, I think the majority of patients would prefer an oral, but not at the expense of other things. And then another piece is market access. Patients have experienced challenges with market access over time. And so having their product paid for is something that they worry about, and it's something that they think about before they entertain the idea of switching therapies.

Okay. So maybe as a transition, some really good remarks to set the table. There was a big event last week, CHAPTER-3 data from a competitor. I think you've been very clear and transparent on your perspective that you expected this data set to be effectively good and demonstrate that they have a real drug. So rather than debate the nuances of if it will get approved and how that's going to play out, what changes for you? I mean what were you assuming? What were you modeling? Was this a bear case, base case? Like how do you frame that?

Yes. So first of all, congratulations to Pharvaris. I think they did a really nice job with that study. And it was our base case. So Jason, you mentioned -- you alluded to the fact we do a big annual survey. So every year, and this goes back to before launch, we do a study, a big conjoint analysis followed by a market simulation model that involves 100 patients, 175 HAE treaters all in the U.S. and over 50 payers. And we give them the profiles of everything that's on the market today plus what's coming.

And so when we did this most recently over the summer, we've been giving deucrictibant the profile basically that they delivered in CHAPTER-3. Actually, we gave them a little bit better efficacy than in that. And what the simulation always shows is that, yes, once that drug launches, we expect that drug to start taking some of the new patient starts away from ORLADEYO, not all of them because of the familiarity with ORLADEYO. So maybe it blunts our growth. But patients who are doing well on ORLADEYO are unlikely to switch.

And then we back this up with qualitative research, too, with the patients who are on ORLADEYO today, and we show them the profile of everything to come, including this other 1 pill once a day with great efficacy, no side effects. And the answer we get back from patients on ORLADEYO is, well, that just looks like what I'm already on because for them, that's what they're on. They're on 1 pill once a day, great efficacy and no side effects. The ones who didn't get that have already moved on. And so that's what gives us really good confidence about the future is that a new oral therapy could slow our growth, but it's not likely to take away the base that we've built. And then we'll continue growing, particularly in the pediatric indication beyond that.

So would it be fair to say that, okay, I have a -- from a patient, I have a preference for an oral. I tried ORLADEYO, it worked. I'm more likely to stay with that regimen because I'm comfortable with it. Similarly, I tried ORLADEYO, it didn't work. I went to a prophy injectable, that's a segment of patients that are likely to come back to try a new oral if they still have that preference. And then to your point, the incident market of new patients, you'll be both competing for. Is that a reasonable way to put it?

From the oral perspective. Yes. And then this is where we're excited to have navenibart for the other part of the market.

Yes, yes. No, I think that's a great transition. So let's talk about navenibart. So why is navenibart strategically important? Is the central insight that both an oral -- there's very much different preferences for an oral and injectable. And I guess maybe as part of your answer, talk about like do these 2 things -- will these 2 things cannibalize each other? Or do you view them as complementary?

We really view it as fundamentally complementary, and that's why we were interested in acquiring Astria. So there are about 5,000 patients in the U.S. market, and this is growing steadily that are on injectable prophy therapies. As I mentioned, the market could have been different if an oral started, but patients were already on injectables. And what's really important beyond what I mentioned earlier about, efficacy is #1, always will be #1. If a patient is thinking about switching, they have to have a reason to do that.

So I mentioned when we show a profile of 1 pill once a day to patients at ORLADEYO, they say that's what I'm already on. When you show the profile of navenibart, which is every 3 or every 6 months kallikrein inhibitor, really great efficacy in our Phase II study, patients are getting down to a mean attack rate of less than 2 per year. And by the way, the injections don't hurt because of the formulation. And so patients look at that. And the majority of patients on injectable therapy are on TAKHZYRO, the long-time market leader.

And patients say, "Oh, that looks like what I'm on, TAKHZYRO, but better because of the dosing, because of the administration." And so for them, there's actually an impetus to switch and doctors say the same thing. So that idea of having 2 or 4 injection days per year and really great efficacy in a modality -- in an MOA that they know so well in kallikrein inhibition, that's what really attracted us to navenibart, and we're thrilled how the program is rolling out at this point.

So I want to come back to the Q3 versus Q6 in a second, but maybe just we'll get there with the trial. So you're running a pivotal trial now. I think it's called ALPHA-ORBIT, overenrolled. You're looking at the 2 doses. So is that a 1:1:1? How is that powered? And I guess, what makes the decision for you out of those data on will it be one? Will it be both? What can we expect out of the trial?

So we fully expect, yes, the balance between the doses is identical within the limits of randomization in the trial. But the goal is to have both doses in the label, and I talked about the Phase II data. What we're seeing in the ALPHA-SOLAR Phase II data is equal experience in every 3 months and every 6 months. And mind you, the every 6 months is 2 injections, the every 3 months is 1. So you're getting the same amount of drug in a year. And what it's showing is the same reduction in attacks versus baseline, the same mean monthly.

So we have high confidence that we're going to be able to get both of those doses into the label. And that's really significant because to have that option for patients, that becomes something that's really attractive to them. The study fully enrolled in June. And so what it means is a year from June, the last patient will reach 12 months, and we'll have a data readout in Q3 of next year on both the 6- and the 12-month endpoints in the study.

What about the physician angle? Does an allergist, are they going to -- in some therapeutic areas that the physician might not -- want to not see their patient every 6 months for other reasons. So can you comment on that?

Yes. It's actually kind of neat with the way the dosing works. Physicians have long told us that because of the advances in prophy therapies in HAE, they'll say, I used to see my patient 4 or 6 times a year because they were having attacks. Now I have to drag them in once a year to do the annual reauthorization. So it's become more of a challenge to get patients to come in because they're doing well.

So they actually like this idea of I've had physicians, some of whom are investigators in the trial say, yes, I'm going to try to bring my patient in like every 6 months, not that they need help in dosing, but to kind of make it more of like go see your dentist every 6 months, go see your doctor every 6 months, even though you're doing well. And so there -- physicians are very excited about this. And I think the fact that the study, as you said, overenrolled and enrolled really quickly, it's the largest Phase III pivotal study ever done in the space, and it enrolled as fast as any has ever done, it's because of the product profile.

Okay. Let's wrap up on HAE. One more question here. You've built a great commercial infrastructure around ORLADEYO. Is that 100% portable over to navenibart; the operating leverage coming out of these 2 programs, I assume there's not a lot of additional spend and investment that you're going to have to make. Is that...

That's exactly right. Our team is super excited about having both. So we have 40 reps out there. We'll have 40 reps to launch navenibart, same team. And because of that complementary aspect that we talked about earlier and because of the skills of the team, we just have 2 great options for the market. And so to put in perspective, we're spending a little bit less than $150 million on sales and marketing at this point. So that's going to grow basically at cost of living increases. And so as the portfolio by the turn of the decade is $1 billion plus and growing, that's incredible leverage. As I said earlier, we can plough back into continuing to build a rare disease portfolio.

Okay. Switching gears to the pipeline. This program did come out of your -- from in-house, I believe, so BCX17725., It's actually the next data card that you'll have for Netherton syndrome. Talk to us about that dataset that's coming, I believe, before year-end, what we're going to get? What we should expect? And what does it mean depending on how it breaks as far as moving to the next stage?

Yes. And just for those not familiar with Netherton syndrome, it is a rare predominantly skin condition, but not exclusively. But basically, the uncontrolled tissue kallikrein, KLK5 because of a genetic defect causes skin to turn over much more quickly. And so patients from a phenotype perspective can look anything like really bad atopic dermatitis to something much worse. No therapy is on the market. So it's tremendously underdiagnosed. There's some analogies to HAE before there were therapies. We think there's 3,000-plus patients in the U.S. market versus -- based on claims data that we've done.

At the end of this year, so we have a KLK5 inhibitor dosed subcu every 2 weeks. And we are doing a 3-month study, subcu after IV loading dose, 3-month study in 12 patients, and we'll have that data at the end of this year, and that will inform what's next for this high-need condition.

Okay. You're willing to set a bar? Or what are we looking for? What are the endpoints?

What we're looking for -- we're not looking for perfection in this because, again, there's nothing for these patients. Physicians have only kind of over-the-counter topicals just to try to do some palliative care. What we're looking for is consistency of effect. So of the 12 patients, what proportion of them show response that is clinically meaningful. So 30% to 50% response based on scales of physician and patient measurement of effect. We're also looking -- we're doing some dose ranging in the study. So we're looking for some evidence of dose response that can inform what's next. Is the next step going to pivotal? Is it going to more confirmatory studies? That's what we have to see. But we're excited about the program, and we're excited about the long-term market opportunity.

Great. We've got a couple of minutes left. I want to turn back to where we started, which is more big picture - BD strategy. We talked about profitable company now. Balance sheet is getting stronger by the day. You've made some changes on the way you're going to approach innovation going forward. So you're clearly going to be thinking about a meaningful BD effort, adding additional programs here and there. So without asking you to give us a particular disease or therapeutic area, walk us through the criteria. So rare disease, is that #1?

#1 is rare disease. It's got to be a rare disease where we think there's -- we see the opportunity for a meaningful improvement for patients. That could be better efficacy. It could be better dosing like in the case of navenibart, different dosing, different MOA, but it's got to have a differentiating benefit that we see. We're going to be looking at the science to see if we believe in it. Nothing is going to be speculative.

And so it's whether that is clinical evidence, whether it's really good preclinical data that gives us confidence in a target, biomarker data. So that's what Sandeep and his team will be looking for because we don't want to take flyers on things where there's not a reason to believe in the therapy.

And then it's rare disease with chronic therapy similar to like what we see in HAE. So self-administered or home administered therapy. We're not going to get into oncology. We're not going to get into hospital-delivered stuff. There's a huge need there in rare disease, but that's not our sweet spot.

So no AAV gene therapy or cell therapy?

We're not going to do gene therapy, cell therapy. We can expand beyond orals and monoclonals, but we're not going to go too far afield from -- we'll stick to what we know.

Navenibart wasn't a small transaction for you at the time. I mean it was a meaningful step. So I mean, any guidance around criteria around structure or creativity about what you're willing to do there, size, any frameworks there?

Yes. So just for context, when we bought Astria, that was $700 million enterprise value earlier this year. And we did that because we could, but also because it was very strategic for us in the HAE space. The next things that we do are not likely to be that big. It's not going to be the same thing. It's more likely to be licensing type deals, earlier stage Phase I/II could be in the range of $100 million, $200 million. We can afford that, but less likely to be full company acquisitions where basically, we're not going to strain our balance sheet at this point. That's #1.

And #2, now that we're profitable, we will -- this is a red line for us. We will never become unprofitable. But over the years, as we keep doing this, our operating leverage just keeps growing. And so deals could grow over time. But the next few that we do are more likely to be in the low hundreds upfront and then structure on the back.

Never profitably. Never not profitably. You heard it here.

Rare for a biotech company, but we're going to do it.

That's a good place to end. Thank you.

Thanks, Jason.

Hello and welcome to the BioCryst Second Quarter 2026 Earnings Call. [Operator Instructions] Please be advised that today's conference is being recorded.

It is now my pleasure to introduce Nick Wilder.

Good morning and welcome to BioCryst's Second Quarter 2026 Corporate Update and Financial Results Conference Call. Participating with me today are President and CEO, Charlie Gayer; Chief R&D Officer, Dr. Sandeep Menon; and Chief Financial Officer, Babar Ghias. A press release and slide presentation about today's news are available on our Investor Relations website.

Today's call contains forward-looking statements, including statements regarding future results, unaudited and forward-looking financial information as well as the company's future performance and/or achievements. These statements are subject to known and unknown risks and uncertainties, which may cause our actual results, performance or achievements to be materially different from any future results or performance expressed or implied in this presentation.

For additional information, including a detailed discussion of these risks, please refer to Slide 2 of the presentation. In addition, today's conference call includes non-GAAP financial measures. For a reconciliation of these measures against the most directly comparable GAAP financial measure, please refer to the earnings press release available on our Investor Relations website.

I'll now turn the call over to Charlie.

Thanks, Nick. During the second quarter, we continued to execute effectively on the commercial and development fronts. We completed the integration of Astria Therapeutics and we further increased our cash generations through growing revenue and disciplined spending. That increase in cash flow bolstered by our strategic decision to wind down internal drug discovery will enable us to build a balanced pipeline of rare disease assets through external innovation as Sandeep and Babar will describe. Sandeep will also provide more color on navenibart where we completed enrollment of the largest blinded HAE trial ever and did it ahead of schedule.

Our proof-of-concept trial for BCX17725 in Netherton syndrome is also enrolling well and we look forward to having data by the end of the year. This week we also have exciting news for HAE families as ORLADEYO oral pellets started shipping to kids. Despite the manufacturing delay, we have already received 47 prescriptions for ORLADEYO pellets through July 31, which is well ahead of the total we expected for all of 2026. Prior authorizations are complete for about half of these patients and so far, the approval rate has been strong.

We have a lot to learn about ongoing prescription rates, rates of paid therapy and real world outcomes for kids taking ORLADEYO, but we are thrilled to be delivering this much-needed therapy. Our market research in Q2 showed that preference for and satisfaction with ORLADEYO were up for both patients and physicians compared to 1 year prior. This played out in market demand as new prescriptions for ORLADEYO capsules in Q2 were consistent with our history and expectations. We also activated new prescribers at a rate in line with historical trends.

On the payer side, the heavy part of reauthorization season is now behind us and we continue to make incremental improvements with the paid rate, which ended the quarter at 84% compared to 83% 1 year ago. Finally, we are pleased to partner with CareMed as our new sole-source pharmacy for ORLADEYO shipments to patients. The sole-source model has been a cornerstone of our strategy since launch and because our HAE portfolio and the number of patients that we serve is growing, we chose CareMed for their ability to scale operations with our growth. All ORLADEYO pellets prescriptions for kids are shipping from CareMed and the 12 and up population will transition over the course of this month. We look forward to serving these patients together.

I'll turn the call over to Sandeep to describe our pipeline developments.

Thank you, Charlie. I'm pleased to share that in June, we completed enrollment of our pivotal study, ALPHA-ORBIT for navenibart, our investigational long-acting injectable plasma kallikrein inhibitor for HAE prophylaxis. We are excited about the potential for this product to transform the injectable segment of the market with its differentiated profile. We expect to announce the top line data for this program in the third quarter of 2027. Because navenibart's extended dosing regimen includes every 6 months dosing, we will keep the study blinded to reach 1 year of safety and efficacy data as agreed by the FDA, putting us in a unique position to evaluate efficacy at 6 and 12 months.

I'd like to also address our June decision to discontinue internal discovery programs and close our research unit in Birmingham. Since I've joined BioCryst, we have completed a comprehensive review of our programs, capabilities and strategic options to ensure we are positioned for future success. After a careful consideration, our team concluded that expanding our access to external innovation is the best way to allocate resources and accelerate the development of a stronger pipeline. This decision has no impact on our clinical programs including BCX17725, which remains on track for early clinical data in patients from Part 4 of our Phase Ib study by the end of this year.

We remain excited about the potential to bring forward a treatment for patients with Netherton syndrome, a rare severe skin condition with no approved therapies. We will continue to be active in our search for external assets. The decision to end internal research broadens our scope to build a balanced pipeline of differentiated assets across clinical stages in areas of high unmet need where we can leverage our scientific, clinical and commercial strengths.

I will now transition to my colleague, Babar.

Thanks, Sandeep. Our second fiscal quarter reflected continued momentum across the business, steady growth in ORLADEYO, substantial progress across our clinical pipeline as you heard and very importantly, a key step forward in resolving the manufacturing issue to get our pediatric launch in the way. It was also another quarter that reflected our financial strength with strong operating profitability and a cash position that leaves our balance sheet in excellent shape to execute on our go-forward strategy.

In my remarks today, I will be referring to some non-GAAP figures, which are adjusted for revenues and expenses related to our former European ORLADEYO business, stock-based comp and expenses related to the acquisition of Astria. You can find additional details for adjustments and reconciliations in the press release. We believe the non-GAAP figures provide a better underlying view of our business on a forward-looking basis.

With that said, let me turn over to the financial results. Total revenue for the second quarter of 2026 increased 45% year-on-year on a comparable basis. That is excluding the European divestiture. I would draw your attention to ORLADEYO revenue of $158.2 million in the quarter, which grew 10% year-on-year on that same comparable basis. New patient demand remains strong. And as we build on our understanding of the peak market dynamics with real-world outcomes, we feel confident that it will continue to augment our growth.

Market research results continue to deliver the same consistency of findings regarding the value of ORLADEYO and we naturally see that play out in our day-to-day commercial execution. Still adding new prescribers, we see consistent long-term patient retention to past trends. And now with the reauthorization season largely complete, we achieved a slight increase in our paid rate over last year, but which is important and impressive at the same time because you may recall, we had already made a substantial improvement on that metric last year and that is a true reflection of the benefit of ORLADEYO for HAE patients.

Our total revenue for the quarter also includes $55.7 million recognized in the quarter from the upfront payment of our navenibart European license agreement with Neopharmed Gentili. I'm also very pleased to share that we are seeing stable operating costs across our business. As you can see from our press release, our non-GAAP G&A and sales and marketing expense categories for both the 3-month and the 6-month period remained relatively flat compared to prior periods. The increase in R&D is driven by ongoing Phase III activities for navenibart as you would expect.

As a result of these trends, we posted a strong non-GAAP operating profit of $113.2 million for the quarter. Importantly, we have taken deliberate steps to further sharpen our cost structure going forward. As we stated in our June news release, we are shifting our R&D strategy towards an external innovation model, discontinuing our internal discovery programs along with the announced closure of our Birmingham facility by the end of this year. The result is a leaner, more focused operating model that is expected to generate meaningful cost savings as legacy R&D costs continue to come down.

This enabled us already to improve on our non-GAAP operating cost guidance range for the remainder of the year, which we brought down from the earlier range of $450 million to $470 million to $420 million to $440 million. The financial discipline continues to positively impact our balance sheet. We ended the quarter with just over $350 million in cash, cash equivalents and investments. And importantly, we generated positive cash flow in the quarter even setting aside the upfront proceeds from the license agreement. Simply put, our balance sheet has never been in a stronger position.

On that front, let me address from a financial standpoint our strategy going forward. We have a business that continues to generate strong profitability and cash flow growth. We have 2 very important catalysts, one of which adds to our growth profile in the near term. So from a BD perspective, we don't feel any need to unnecessarily stress our balance sheet. As Sandeep alluded earlier, with the shift to external innovation, it allows us to build a more balanced pipeline of clinical assets across all stages.

These could be early to mid-stage clinical programs where we will have much more transaction structure flexibility. But ultimately, the objective for us is not about the quantity, but rather the quality of the clinical programs that add to our overall growth profile. We are in a very unique position relative to other companies of our size in that we can finance BD and R&D, deliver profitable growth with excess cash flow, remain flexible to consider delevering the balance sheet and/or buybacks.

Moving on to financial guidance. Given closing of the navenibart EU license, we are raising our total revenue guidance to the range of $690 million to $715 million. Despite the delay in the pediatric launch, we feel long-term ORLADEYO trends are intact and hence, maintaining our full year 2026 ORLADEYO revenue guidance of $625 million to $645 million. On non-GAAP operating costs, we are maintaining the range at $420 million to $440 million that we announced on June 29. Over the last 12 months, our business has gone through a number of critical transactions; sale of Europe followed by the Astria acquisition, a CEO transition and now the recent Birmingham decision.

And while the new BioCryst, I would say, is still in an evolutionary phase, one thing that has remained constant is our strong operating performance record throughout. For that, I'm deeply grateful to our team for their unwavering focus on what matters most, advancing ORLADEYO and our pipeline to deliver critical life-changing medicines to patients.

With that, operator, we are now ready for questions.

[Operator Instructions] Your first question comes from the line of Laura Chico with Wedbush.

Just 2 for me. One, it looks like a very solid ORLADEYO performance this quarter. I know one of your competitors had indicated their prophylactic product was seeing switches from a range of patients. Just curious, maybe Charlie or anybody else want to comment, any anecdotal evidence with respect to ORLADEYO persistence in the period? I guess are you seeing more pressure from competitors? And then just one on the Netherton program. I think you mentioned enrollment is proceeding. Have you -- are you approaching the completement of recruitment? And just kind of curious if you could elaborate on any challenges or learnings that you've made so far?

Great. Laura, I'll take the first question. Sandeep can address the second one on Netherton. Yes, obviously we have new competitors out there, new injectables. And what we're seeing is what we expected from all of our market research is that the injectables are primarily affecting existing injectables, particularly TAKHZYRO. The overall retention for ORLADEYO is the same pattern as Babar mentioned in his statement. So of course we lose some patients and what now happens is we tend to lose them to the newer products as opposed to the older products, which is exactly what we expected. And our overall view on ORLADEYO growth, we're very positive about. Sandeep, do you want to address the Netherton?

Yes. Thank you for the question. So we are on track for completing our POC data that will be coming end of this year. And what are we seeing? As you have seen in our healthy volunteer data, the safety has been well tolerated and the drug distribution that has been part of the epidermis where all the action is. So at this point that is the only thing we can comment on. We are still waiting for more data to come in terms of the holistic understanding of the PK/PD and the clinical efficacy endpoints.

And Laura, just as far as enrollment in the trial, yes, it's been going strong and we're confident that we'll have that up to 12 patients at the end of the year and that will inform next steps for the program.

Our next question comes from the line of Gavin Clark-Gartner with Evercore ISI.

Just following up on the Netherton side. I guess what are your expectations for how a placebo arm could potentially perform? Like we have some of the SPEVIGO data showing a bit of an improvement from baseline. We have the Daiichi data, which showed maybe a little bit of a decline on placebo. So I guess I'm just curious how you're piecing together this and contextualizing what a good result is on the efficacy side.

Yes. For us, the way we are thinking about BCX17725, it has the potential to be the first systemically administered and a targeted drug for Netherton syndrome. And the rest of the modalities and other things that have been in use, they are not impacting the implicated target that is exactly needed for the Netherton syndrome. So this is the KLK5, which is what we are targeting. So for us when we look at these patients, they have no approved therapies.

So any relief for improving signs and symptoms for Netherton would be a big advance based on our discussions with the patients and the KOLs. So that's what we keep on learning. And we will have a better understanding of the totality of the data that will come at the end of the year. And so obviously the placebo is -- there will be some placebo response, but then there is the disease itself has its own waxing and waning. It's a very variable disease in general.

Our next question comes from the line of Stacy Ku with TD Cowen.

We have a couple. So first, as we think about ORLADEYO, maybe just can you talk through the clinician additions this quarter versus historical averages? What kind of halo effect you expect with the pediatric launch? I understand your comments on the injectable kind of share with new patients, but just help us understand kind of how ORLADEYO would continue to progress in a steady fashion. That's one.

And then two, maybe talk about the new specialty pharmacy setup. Is there any expectation setting when it comes to the transition? Should it be really smooth? Just help us think about the cadence of the U.S. launch for ORLADEYO, maybe how the second half might look relative to the first 2 quarters? So that's the second question. And then just a very quick follow-up on Netherton. Given that you are in Part 4, any early comments you're willing to share on Part 3?

All right. On the clinician additions, you might recall from the past, we had talked about approximately 60 physicians per month prescribing ORLADEYO. We were a little bit above that so ORLADEYO continues to gain in the market. From the halo of pediatrics, obviously it's still early. But of those 47 prescriptions, a number of them were actually prescribed by physicians who had not yet prescribed ORLADEYO. So that's a good early sign. Like I said, there's a lot to learn about peds now that we have product in the market, but we're off to a really good start.

On the new SP transition to CareMed, the biggest decision was, as I mentioned, the ability to scale with us as we grow. But in the process, we also did look at experience bringing in prophy active programs and CareMed has a lot of experience doing that and we've kind of been impressed with their track record. Anytime you do a switch like this, there can be bumps and this whole switch is just starting this month. We don't expect it to affect ORLADEYO long term, but we'll have to just kind of see in the quarter. We think long term this is going to be great for patients.

And our guidance, as Babar said, is still the same $625 million to $645 million for the year. And I don't even need to pass this over to Sandeep on sharing anything on Part 3. No, it's too few patients, too short a time. We're really pleased with how Part 4 is enrolling and we look forward to having data at the end of the year.

And our next question comes from the line of Timur Ivannikov with Cantor.

This is Timur Ivannikov on for Steve. So my question is for ORLADEYO. I was hoping you could provide some color on the volume growth in the quarter because it sounds like you grew revenues 10% year-over-year, but there was also a 9% price increase. And you mentioned increased paid rate. So what does this imply about volume growth year-over-year in the quarter?

Sure, Timur. It's basically half and half. So you might recall that on the 9% price increase, we previously said we net about 4.5% and then obviously we improved the paid rate a bit. So the overall was about half volume, half kind of price and reimbursement.

Our next question comes from the line of Jess Fye with JPMorgan.

This is [ Sylvia ] on for Jess Fye. Two questions from us. Can you elaborate on your business development priorities? Does this look more like bolt-on acquisitions to the clinical pipeline or partnerships? And what kind of prophy businesses does this look like? And the second question I have is can you walk through the OpEx outlook for 2027 and beyond in the scenario where Netherton advances and in the scenario where it doesn't just to help us understand the flex factors there?

Yes. So I would say that from a BD perspective, the objective is to build a really high-value pipeline validated biology proof of principle. As I mentioned that naturally we are not going to stress our balance sheet so we're not looking at large company acquisitions that will put stress. We are very laser-focused on delivering on our catalysts. So it could be the clinical mid-stage assets and with an emphasis on clinical assets. That's where we think we can do a real impact. So that's from a BD perspective how we're thinking about the world.

And like I said, we are cash generating self-sufficient so we don't necessarily looking at the large capital raises to fund our BD or R&D operations. From an OpEx standpoint, I think the outlook is really strong. We haven't really given 2027 guidance. But as you may recall that when we lowered our guidance, that was at the middle of the year that we were making this decision. And when we are ready to provide that guidance, we are anticipating that the costs will continue to go down because we will be past the Birmingham facility closure. We will be past like closing out internal programs.

So looking ahead, it's basically Netherton and navenibart expenses. And as you can imagine that navenibart expenses will be coming down as well as that program reaches its completion. So going forward, the operating expense guidance absent any new BD deals will be really strong. Having said that, it is our objective that even as we bring BD assets in, BioCryst is committed to delivering profitable growth. So that is a key imperative for us to remain profitable and cash flow positive.

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

First one regarding the pediatric launch. Charlie, I think you mentioned that the initial numbers were tracking ahead of your expectations. Just curious if that changes your outlook for that opportunity. And whether we should expect the paid Rx rates, which I think resides around 80% right now, to be similar on the pediatric side? And then I guess second question, just looking at Slide 6 where you highlight 1,600 patients are currently on therapy, 3,500 other ones have tried the product since launch. So I assume there's another 3,000 to 4,000 patients that have yet to try the ORLADEYO at this point. Are you able to capture these other patients via the current base of prescribers or you'll need to expand beyond the 1,500 unique prescribers you currently have?

Yes. As far as the peds, like I said, we're encouraged by the early demand since we just have product going out to patients this week and obviously that should probably make prescribers more comfortable too. We have to kind of see what the ongoing trend is and so it's a little too early to call, but certainly the early signals are very positive. As far as the paid rate, we expect it to at least be in the range of what it's been for capsules. The payer mix will be a little bit different obviously because we're not going to have Medicare. So it's going to really be a split between commercial and Medicaid, but the early signs there are good as well. And the pediatric pellets slot right into our contracts that we already have. So it's not like a new lift to get these things on formulary.

As far as the ongoing opportunity, I think the fact that demand has continued to be as consistent and strong as it's been over the last couple of years plus we're adding new prescribers just shows that there's still plenty of opportunity out there and we see that in our market research as well. We also see that new prescriptions are coming very strongly from existing prescribers as well as obviously these new prescribers that are opening up. So the pattern on that really hasn't changed and pediatrics can only further help that.

And our next question comes from the line of Brian Abrahams with RBC Capital Markets.

Two for me. Maybe first on navenibart just with the enrollment completion and upsizing in that study. Just wondering if, I guess, the upsizing was based on just like higher than expected interest or on any kind of observations on dropouts, the types of patients you're seeing there and sort of any implications for powering? And should we assume this is almost entirely adults with just a few adolescents? And then secondly, it seems like with ORLADEYO, you're in a nice steady state with regards to patient retention. Just wondering if there may be any ways you can further improve on that just ahead of potential competitor launch? Anything that you might see in upcoming competitor oral prophy results that could adjust your strategy there just in anticipation of potential additional competitive entrant.

Sure, Brian. Let's do the navenibart and I'll take the first part and you take the second part, Sandeep. Just on the upsizing, no, it had nothing to do with anything about powering. It was purely about patient and investigator interest. And as we mentioned, it was the largest blinded trial ever in HAE yet it enrolled just as quickly as other recent trials that were smaller. And so I think it's a reflection of the team as well as the profile of the product. Do you want to just talk about the overall powering?

Yes. So the overall powering, we are already overpowered for the trial so we don't have any concerns. In this case, it was just a function of more interest from the investigators. So that actually is a very, very positive sign for all of us in terms of the uptake of how much value the patient -- the physicians are adding to this kind of a modality and the dosing regimen.

And then as far as patient retention, I think one of the things we always look at is just our operations and how we're performing and we think that there might be a few things there that we can further improve, but we're pleased with the overall rate of retention. And it really comes down to what we said before, which is patients either do quite well on ORLADEYO and then they're very sticky or they don't and they move on. And so that's what our market research shows. That's what our real-world evidence shows and we expect that to continue.

One thing we will be looking for is in the pediatric indication, what is the retention there? And that's going to take us some quarters to really see that in the real world. But in the clinical trial in Apex P, we saw that long-term patient retention at 1 and 2 years was above what we saw in our adult trial in Apex 2. So we'll see if that plays out in the real world.

Our next question comes from the line of Maury Raycroft with Jefferies.

Congrats on the quarter. For the new patient prescription momentum being maintained in second quarter, is that only driven by the new pediatric patients or prescriptions or can you provide more context on how we can quantify this and understand contribution from new adult patients versus pediatric patients?

Sure. Yes, the 12 and up population for ORLADEYO capsules, demand was very consistent with what we've seen over the last couple of years. So that was what we expected, but it was also great to see that continued consistent strong demand. And then the pediatrics off to a great start, that's just upside on top and we'll see how that progresses over the next few quarters.

Got it. Okay. And then just clarifying with the paid rate at 84%, does that only include the adult population? And wondering if you can comment on just how you expect the paid rate to continue increasing for third quarter and fourth quarter?

Yes, that does only include the adult population because we didn't have the peds -- the pellets out there yet in Q2. And just a reminder, the paid rate also includes patients who are completely uninsured so that's about 4% out of that 16% that are getting free product. So we feel like we're making great progress and continuing to chip away. Our long-term goal is 85%. But I always say that if we get to 85%, our goal will then go up and we feel good about it. Typically, and I've said this before, in the second half of the year, the paid rate tends to drop off a little bit because the patient mix is driven more by new patients coming in who tend not to get to that 84% quite as quickly.

For some of them, it takes longer. And so the typical pattern is 1 or 2 percentage is lost over the second half of the year and then we gain it back in the reauthorization season next year. So I think end of Q2 is a great point to measure progress and that's why we pointed it out this year where we picked up 1% versus last year. Next year I would expect us to be at or above where we were at the end of Q2 this year.

Our next question comes from the line of Jon Wolleben with Citizens Bank.

Just talking about the pediatric opportunity. You've talked a little bit before about 500 diagnosed patients and with 10% already seeking prescriptions. Can you talk a little bit about that early dynamic if those were families coming in and asking about ORLADEYO or are you guys getting out there in the community? How do you think about the ramp and then also the diagnosed population as you get out there and talk about it more?

Yes. Again I mean, Jon, it's really exciting what we've seen. You pointed it out, it's close to 10% of that 500 number. What we are seeing in our market research is that physicians: a, are very enthusiastic about prescribing ORLADEYO pellets to kids; and b, the availability of an oral prophy makes them think about prescribing to more of their pediatric population in general. And so the early signs are that we could not only get more of the existing prophy patients onto oral prophy, but also grow the market, expand the market because there should be more like 1,200 kids diagnosed in this age population. And so we're going to be watching for signs that that 500 grows. Early signals are positive, but we're going to need another many quarters to really see how this plays out.

Do you expect to continue giving us pediatric prescription data going forward?

No, I don't think we'll give you the exact number going forward. We'll give you the overall color on how is demand in general and we'll probably say how is the demand directionally going in pediatrics. But we just wanted to give -- and you hit the point, it's close to 10% of that 500 number. And so we thought it was significant to talk about it at this point, but we probably won't give the numerical number going forward.

Thank you. I'm showing no further questions. Ladies and gentlemen, we'd like to thank you for participating. This does conclude today's program and you may now disconnect.

Okay. Great. So good afternoon, everyone. Welcome back to the Bank of America Health Care Conference. I'm Tazeen Ahmad. I'm one of the biotech analysts here at the bank.

It's my pleasure to have with me our next presenting company, BioCryst Pharmaceuticals. Sitting up here on stage with me are 2 members from the management team. We've got Babar Ghias, who is the Chief Financial Officer; and Sandeep Menon, who is Chief Research and Development Officer.

Gentlemen, thank you for making the trip out West.

Thank you, Tazeen, and thanks for having us.

So maybe as an overview, just give us a quick description of BioCryst as it stands today. Some people know it in various different forms, but talk to us about what you found appealing about it because you're one of the newer members to join the company. And we can talk about some of the important drivers of the stock after that.

Fantastic. Well, thanks again for having us. Before I begin, I'll just remind that we will be making some forward-looking statements. So I encourage you all to look at our SEC financials for the GAAP to non-GAAP reconciliations as well as risk factors.

With that behind us, what attracted me to BioCryst, it's a company at a phenomenal inflection point. ORLADEYO has -- it's in sixth year of launch and continues to do extremely well in terms of how we're building that market, especially in the face of several approved products in the space. So that naturally the safety of a growth engine behind a lead product that really excited me.

And then what happens after that? And I think if you look about the decisions that we have made in the last 9 months that are pretty reflective of how the strategy is evolving behind ORLADEYO. Our vision really is to build a high-growth innovative rare disease biotech with multiple products on the market by 2030.

And now that we are very fortunate to have navenibart, which is a Phase III program in our pipeline. And then back in navenibart, we have another very interesting and promising program in Netherton syndrome, no approved therapy, highly, highly devastating rare disease.

So I think all of that -- and then basically, with Sandeep just very recently joining us, and hopefully, he shares the same enthusiasm in terms of the inflection point, we are at a very interesting and position now to take all the momentum that we have behind from ORLADEYO to channel that into building like next product candidates and then also converge them with our internal discovery pipeline because historically, BioCryst used to only rely on internal engine. Now we're in such a strong financial position based on ORLADEYO's momentum that we can be much more creative in terms of building a really diversified rare disease biotech.

Okay. So you guys have also really been busy with business development. How do you make a decision that some asset is worth bringing inside the company? So we can start off with the Astria acquisition. We can also talk about some of the partnering decisions that have been made recently as well.

Yes. So I'll just give you -- you're absolutely right. In the 9 months that I've been here, we've been really busy. I'll start with what sort of started this, what was the catalyst.

So we, as a small biotech company had built a really good team in Europe. And what we soon realized that one product was not going to be enough to build scale basically as a single product company, right? And we were very fortunate that based on the stuff that we were doing over there and the momentum that we also had in the ORLADEYO in Europe, we were approached by NG to divest that business at very attractive terms.

What that enabled us was to actually clean up our balance sheet and improve our financial profile because Europe, even though top line was increasing, like I said, we were not at scale yet that we could make profit out from there. So that kind of freed that space on our U.S. financials to become much more profitable than we already were.

That enabled us to bring in Astria Therapeutics. And like I said, at this point, it's with the vision of having multiple products by 2030, it was not going to come from an internal pipeline given that's early in nature. So we knew that we had to do something. Astria was something that we had actually been looking for many years because there was such a natural synergy of having the only oral in the market and potentially the best-in-class injectable product with the same commercial organization that made a ton of strategic sense as well as financial sense to bring those 2 together, and we were very lucky to have that in our portfolio.

Moving on to what happened, we were never going to build in another European thing, and we went through a process where we had a lot of interest because of how promising that program is from European buyers. And after a careful evaluation and analysis, we thought that it made sense to actually put it back in NG's hands because you don't want 2 brands to be competing against each other and disharmony around the brand promotion strategy. And then most importantly, it is a theme that we had curated over many years. So we had a very high conviction in the NPV value of that deal. So that's kind of how it came about.

To your next question, I think I would say that how we think about the decision, we are -- while our first and second asset are in HAE, we are not an HAE-centric in the sense of only an HAE company. We view ourselves as a broad rare disease company. Naturally, the first product is in HAE. The second one is coming in HAE because we didn't want to take that risk.

Netherton syndrome is a classic rare derm disease. And when we think about business development strategy, we are looking at a broad portfolio. But at this time, it makes sense for us in terms of the infrastructure that we have built and the leverage that we have in business to look at more later-stage opportunities because I think we don't want to take like early development risk on something new because there's also a balance sheet perspective that we have to think about.

So as we think about our BD strategy and think about what comes next, it will tend to be late stage. It will tend to be with a potential product candidate that gives us an opportunity to bring more stuff into the 2030 time frame.

Okay. So on Astria, this is an injectable. So when this drug launched before you were a member of the team, the main distinction was that this is an oral. Everything else is an injectable and HAE for prophy. And this is something that's going to be differentiated, which has proven to be. So how did the thinking evolve that if you needed a second asset that an injectable -- less frequently injected, of course, but nonetheless, one that was an injectable would be complementary to what you already have?

Yes, absolutely. And I think we are obviously, in many ways, the pioneers of the switch market in HAE because it is predominantly a switch market as you've had experience as well. Now if we go back in time and said that like if the first approved therapy was an oral therapy, there will be more people on oral today than they are on injectables. I think the way the market has evolved, you had recombinant therapies, you have C1H replacement therapies, plasma kallikrein inhibitors.

So the way it has evolved, the way we see the market today, there is a structural segmentation. There are patients who don't mind basically taking a daily pill and there are patients who -- you know who basically are okay with an injectable. I mean the proof is -- goes back to the stickiness as well to some extent. There's still patients who are taking Cinryze as inconvenient a therapy as that is. It's an IV that you have to go through.

So I think the way we see the market, there are patients who want the oral and are okay, and then injectable where by our count, there's about 5,000 patients on injectable and several approved therapies. But there is an incredible amount of demand for an injectable that is dosed less frequently. I think that's where the value proposition we see of navenibart.

And [ Takhzyro ] has -- in terms of our work that we've done and we've -- if you show it to docs and they look at lanadelumab, they look at navenibart blinded profile and they're like, yes, this is a fast-acting lanadelumab with less injection site pain.

So we feel that right now, we are the only oral in the market. And by the way, for peds, I know Pharvaris is upcoming with the thing. But in the peds, as you saw last year, we got the peds approval as well. So we're the only product, oral formulation with 2 and up approval. So that we will have for our main pillars. And then we will also have the best-in-class injectable product when potentially navenibart gets approved. So we see that as complementary based on how the market has evolved over time.

Okay. So as ORLADEYO continues to mature, what's your view of what peak sales could be by the end of the decade?

Yes. So I think we have laid this out very clearly or at least I hope we have laid this out clearly in our investor deck that before we had sold it to -- we sold our European business, we were -- we had said that it is on a $1 billion peak potential and Europe it was contributing.

At that point in time, we did not have pediatric in our portfolio. We got rid of the European business, but now we have pediatric, which is an incredibly interesting market dynamics in terms of how it is doing that.

So from this point onwards, we feel that we need to be doing about 150 patients, net patients on average between now and 2029 to get to that $1 billion mark. To put things in context, historically, we've been doing over 200 net patient adds every year. And we feel that it's not going to be linear, but it's very achievable.

Like I'll give you a stat that most recent -- in the most recent quarter, we continue to not just see like high prescription demand, but 6th year of launch, we're still adding new prescribers, which is pretty impressive when you think about -- because historically, we used to give that stat and it is in line with the historical numbers. But we're very excited that we're still adding new prescribers and kind of like how are we growing that market. And so I think we're still maintaining that long term, it's that $1 billion path is highly achievable.

Okay. So as you think about the evolution of the competitive landscape for prophylaxis, you mentioned Pharvaris. So how do you think about the market with another potential oral that can come on?

Yes. And again, going back to the evolution of the market, this is not a winner takes all market. I think it's like you understanding your patient base. Naturally, the one thing that I would say, people that take HAE -- ORLADEYO, they are extremely well controlled. So either it works for them or they move on because there are so many approved therapies that are already there.

So we are not -- nobody is insulated from more competition. But as we see it, and you know it that we do extensive market research and we do every competitor, the best product profile and we do this sort of Monte Carlo simulation analysis. We feel that when we -- when Pharvaris gets approved, we will -- for new patient adds, we will see competition. But if you're already very well controlled on a once-a-day pill, I don't know what more that another once-a-day pill adds because our data, and we've generated this long-term data that there's one thing is a regulatory endpoint or regulatory marker that we had of efficacy, but what's the real-world experience of patients.

And the data that we've generated, these patients get over 90% attack rate reduction and then also mid 95%, mid-90s percent compliance because it's working very well for them. So we feel that the base business is very well protected. The new patient adds, yes, we will be competing for sure. But the other thing is we'll have 8 years of launch by that -- launch experience by that time. So knowing our patient audience really, really well will matter a lot.

Can I add something here?

Sure.

So there are 2 other -- 2 or 3 things that Babar nicely summarized, right? One is based on the real-world data, what we are seeing is it's almost like a functionally mean attack rate of 0, right? So functionally, patients are fine, you take the medicine.

Second thing, as a physician, as a prescriber, why would you change something just for some point estimate when you have got history with 7 years or 6 years of data and such a big safety database, right? So that would be the -- at least the 2 trigger points for us basically that this is going to be for us an increasing market. And these are -- there's only so many physicians that are prescribers.

So for them to try things new on a new patient, I'm not saying that will not happen, that will also happen, but it may not be as much as what it's made out to be, at least based on my experience as both as a prescriber and a clinical developer here. Yes.

Okay. So what about other mechanisms of action? For example, there's gene editing that's being explored for HAE. How would you consider that falling into the competitive landscape?

Yes. So gene editing, to me, when I'm thinking about gene editing here, Tazeen, is basically you just have to wipe off and almost get to a full cure, right, not only just functionally, but the mutations are out of picture in terms of the treatment. So at least, again, I don't want to comment on Intellia data, but the expectation of a gene editing or a gene therapy would be that it is full -- not only functional cure, but full pathological cure.

I don't see that yet in terms of the data. So from -- for a prescriber and also for an insurance to pay that money for something that -- with the pill or others that are fully controlled. And many of these gene editing or gene therapy will have a longer commitment for safety database because we still don't know what's happening in the system.

So that's some -- and especially in a therapeutic area where you have got so many different options. It's not an option. It's not like a Huntington's disease or somewhere where you don't have much options, right? Here, people have got a lot of options. So to me, I'm still pretty mixed about gene editing and gene therapy, at least for this indication.

Okay. Well, let's talk about your own pipeline products with Astria. So how do you think a less frequently dosed injection could compete against orals? And maybe how are you thinking to the point that you made, unless it's curative for gene editing, how do you think that argument could change with an infrequently dosed injection? And just remind us what the dosing frequency is going to be?

Yes. So it is basically -- and Babar, you have to add more.

Yes, sure.

This is -- just to remind people, it's my fifth week here. So I guess -- so from a perspective of what you get from the injectables, right? I think at least the injectables that are in the market, it's much more frequent. That's number one. The second one is also they have got high ISRs. Injection Site Reactions are much higher.

So what we are bringing is once in 3 months therapy, number one, in terms of convenience. The second one is a tried and tested mechanism that we already have been very successful. The third -- and the mechanism actually implicated in the disease. And thirdly, we are bringing in less ISRs based on whatever data we have. We don't have a lot of site -- Injection Site Reaction. So we are bringing in that profile for convenience, safety and also mechanistically much more closer to the site of action.

Yes. The only thing I would add is when we do a lot of market research, the tipping point is 3 months with 6 months kind of like another add-on on top. I think going from 12 injections a year to 24 injections that are currently with like different things versus 4 or possibly 2 is a game changer. And you're seeing some of that same analogs in, call it, myasthenia gravis where there's a lot of incumbent therapies and the newer ones are like more longer dated.

Yes.

So our market research showed that, that is a huge game changer. And like I said, this market is such -- there's such segmentation that it's not just an oral or it's not just an injectable. It's based on real-world experience. And patients are okay with taking injectable. I think the benefit and the beauty of navenibart is you get and forget. And that's really what we're really excited about in this space.

Okay. Just remind us when the next data set is to?

Data set for...

Navenibart.

Yes. So it's going to be end of year next year is when we are going to do the BLA filing.

BLA filing at the end of next year. But in terms of guidance of when top line data happens?

So top line data will be around that time. Basically, it all depends upon, so we are also discussing with the FDA in terms of what should be the right time to divulge the data. So we want to make sure we are absolutely compliant regulatorily to disclose any data outside because this is a Phase III pivotal study.

So as you know, we have said that by middle of this year, we will be enrolled.

Yes.

And what we have been extremely pleased with that even with this acquisition, there was -- we did not skip a beat in terms of execution. It is the largest HAE study. And naturally, it's the first one of its kind in the sense there's a 3-month dosing and a 6-month dosing.

So prior to that, when Astria had been guiding basically was Q1 of 2027. I think we're still working with the FDA because of this dynamic of 6 months and 12 months. But what it doesn't change is our BLA time line. I think what we want to make sure is that we are complying with FDA's requirement for this 6-month dosing, and we are able to do the right thing for the trial. So I think that's something that we are working on.

Yes. So it's a unique data package where you have got in the 6 months that everybody has done. We have got 12 months. So we are in a real advantage. It's not only to Babar's point, not only the largest study, but also the longest study in HAE.

So what would be good data in terms of attack prevention?

So I want to make sure that we don't -- we are not hung up in like point estimates. What our current point estimate is 90% to 92% is basically what we got in the Phase II study. Obviously, between Phase II, Phase III, there's always going to be some translation that happens and it is going to be a randomized trial and everything.

But Tazeen, what I mentioned before, it's the whole totality of the data. It's not just the point estimates. As a physician and a prescriber, people will not care whether it is between 90% or 80%, 85%. People will care about what you bring to the table in terms of the convenience. Is my Injection Site Reactions basically going down. And at the end of the day, whether patients are -- it's helping the patients or not. So that would be the way we look at it. It's a high probability that we will be hitting the clinical meaningfulness in terms of what we have already seen, right.

And I think just to add on to that, what the industry is a regulatory benchmark, 90%, 92%, which, by the way, we were really, really excited that third and 3 months and 6 months is not differentiating. The other stat is noting is the attack 0.16 attack per month, which is basically going to that. I think that's becoming more and more relevant at how well controlled I am that equates to less than 2 attacks a year. And I think that's kind of like the durability of the potential drug candidate with the long-term dosing profile. I think that's what we're really excited about.

So as it relates to breakthrough attacks for patients that are on prophylaxis, do patients tend to be heterogeneous? And like can you -- what is an average number really mean of attacks per year?

So it all depends on the patient population. Basically, what we have started, at least our trial, the way it is designed is making sure it is absolutely contemporary in terms of the average attack rates have gone down over a year, right? So our screening period or the running period, we have got a criteria to screen in the right set of patients so that we are not -- first of all, it's much more of a precision approach in terms of having the right population in the study because obviously, to your question about heterogeneity, there's always going to be heterogeneity in response. But we are trying to do our best in terms of enrolling the right set of patients in terms of filtering through our running period.

Okay. On the pediatric front, can you talk to us about the granule supply disruption...

Absolutely.

And where that stands?

Absolutely. And just to clarify, it's not a safety or efficacy issue or an FDA issue. It's a very isolated quality batch release issue that we found a little bit late in the process as we were getting ready to ship product. And just out of prudence and you just get one chance to get your launch right, we want to make sure that the patient experience has been -- is really, really good because I'll talk a little bit about where we stand overall.

We're still working on that root caught analysis -- root cause analysis, and we will have more information in Q2, but it's not something that requires like an engagement with the agency or anything like that. I think it's just a quality specs issue that we were just trying to solve for, which we'll have more information.

Having said that, as you know, we have 4 strands, and we have been receiving prescriptions for all 4 strands, which is very good. And there is a lot of excitement for this product. And what we are able to do in the meantime is collect the prescriptions and then our really, really strong patient services team can actually start the background process with respect to insurance verification and all of that. So once we actually have product supply, we're ready to go. So scripts are still coming in, and they are coming in at like a really, really nice clip.

Okay. So how should we be thinking about nuancing second quarter versus third and fourth as it relates to this issue?

Absolutely. And just to remind you, when we provided guidance at the beginning of this year, $625 million to $645 million, peds was actually not a meaningful part of the -- of that guidance and allow me to explain why because there's a paradigm shift that we have to go through in peds. And I just want to make sure that we were a little bit conservative on that because we haven't seen that paradigm shift when we put the guidance.

And what that means is there's about 500 diagnosed patients in peds. I think our estimates show that they could be double that population that could -- as you know this quite well, you get one drug approved and all of a sudden, the net widen. So there's about 50 -- 500 patients it's more tilted towards acute than prophylactic, which, again, going back to the HAE origin days, you had more acute versus less prophylactic and now it's flipped over.

So I think there's 2 opportunities: a, more increasing the size of the patient population because these are -- our APeX-P trial showed that the onset of symptoms starts as young as like 2.5 to 3 years of age and parents actually delay the decision because they don't want to find out. So I think while they -- and then they come back and they say, yes, my kids were showing the symptoms of HAE, but I was delaying that decision. So I think there's a huge opportunity to increase that.

And then naturally, there's basically the split from acute to more LTP therapy. And the fact that we will -- we are the only -- right now for 2 and up, there's only Takhzyro approved, which is -- obviously has a lot of ISRs. So this convenient dosing formulation will be a huge advantage.

Again, 2026 is not going to be a big contributor, but it is part of our plan as we go to that $1 billion potential. So -- and to your point on Q3, Q4, we can't wait to be on the other side of it because the demand is good, and we'd love to see that those patients get converted into paid patients.

Okay. So maybe let's spend a few minutes just talking about pipeline. You've got a Netherton's program. Just remind us where you are on that and why mechanistically it makes sense to look at it?

Yes. I'll start with the mechanism first, right? The mechanism here is KLK5 is implicated in Netherton syndrome, number one. The second one is whether this is still a severe skin condition, we need to make sure that the drug is reaching the skin. And what we have shown in terms of our healthy volunteer study that it is reaching the areas of interest where the target actually is.

The third one is now we are testing it on the patients. We have completed a small clinpharm kind of dosing study kind of a thing, which is our Part 3. And now we are starting to do our PoC trial, where we will be actually measuring the real clinical endpoint up to 12 weeks. So that's the -- a 12-patient study, and it's on track to deliver the end of the year, it's the PoC results basically. So we will stay tuned. Hopefully, we will have some good news to share.

Okay. Just remind us of what the data needs to look like in order for you to move forward with it? And also, was this an expensive study to run? Just trying to get a sense of the type of investment the company wants to be taking on internal pipeline right now?

Sure. So what good looks like, there is nothing in there for these patients. And if you look at these patients and you talk to them, they have got such an unmet need for them, even any improvement is supposed to be very, very clinically meaningful. So that's -- I'm not to say that we will not be aspiring for more. We'll definitely look for a meaningful change that is clinically impactful for the patient, helping the patient quality of life.

So -- and in terms of your -- what was your next question, Tazeen?

The investment...

The investment that you...

Yes. I think you can share...

I don't -- I think it's not a very expensive study. I think naturally, it's a fusion protein, so there is some CMC. The other thing is there's nothing approved for this patient population. So you also want to be making sure that you have proof of clinical activity before you take the next round of high investment.

I think to Sandeep's point, by the end of the year, one way or another, we'll know if we have a product. What gets us excited is if there is clear signals, naturally, as you've seen more of the recent rare derm, there is precedence that things can move pretty quickly. And I think that's when we feel that like if we actually have a product, then we can naturally then because we'll have potentially another product candidate that could get -- that could hit our profile before 2030.

So I've...

It's really underdiagnosed as well. It's underdiagnosed population.

So outside of Netherton, would you consider looking at other derm indications?

Yes. And I think this goes back to the overall strategy. I think the -- we have built this engine, people think that it's just a commercial uplift, right? I think launching a drug is just an entire organizational uplift. We've already built that an enormous phenomenal patient-centric commercial organization.

So this is a classic rare disease, much like how HAE was, people thought 2,000 patients, whatnot, market continue to improve. Are there other adjacencies, whether it's rare derm or other rare autoimmune diseases or inflammatory pathways? I think we are open to like looking at that. And now with Sandeep, who just joined us, we'll basically try to just define our strategy a little bit more crisply.

Okay. And so if we think about the rest of the pipeline for the company, what other things do you think investors should be looking out for?

I think as you know that in terms of like how our new evolution, the one thing that we want to emphasize for investors is we want to make quick decisions. As you saw avoralstat, I'm not saying whether it was quick or not, but we decided that, hey, this is not a viable path forward.

You mean in diabetic macular edema?

Exactly. It's not a rare disease indication. And this is not something for BioCryst to basically develop and especially in light of the landscape development landscape.

I think what we are very excited about the 2 programs right now. What we will be going forward doing is just being very disciplined about what we bring to the market next, whether there's a white space or there's a product differentiation and be very crisp about like what we can actually deliver from our pipeline. So I think for now, I would encourage you to focus on our 2 lead programs that we have. And then naturally, as we evolve our pipeline, we'll provide more updates.

Okay. And then last question, what's your view on external business development, bringing in assets?

It's -- you think about...

Beyond Astria?

Beyond Astria. If you think about our 3-leg strategy that we have, just to remind everybody, ORLADEYO has a very long durational IP. The composition of matter is September 2035. And the composition of matter on the salt is up to 2040. And we're not adding a lot of -- we're not actually -- our commercial infrastructure is steady state.

Add on to that, navenibart, it's the same commercial infrastructure and that IP goes until 2042. So over the next several years, we will be generating a lot of cash. We are already a cash flow generating business today. We are progressing these assets.

And then the third is like what do we do for cash? Every capital allocation strategy, whether it's new business development, late-stage assets and even potentially like buybacks of shares could be on the table in terms of how we deliver that. So I think BD will be a core part of our strategy to complement some of the internal and external. But the one thing that I would say is like in the short term, we are not adding risk from a BD strategy because I don't think that will sit well at the stage of the company that we are at.

Yes. Okay. You were going to say something?

No, completely aligned. Usually R&D leaders are not.

Good to know. All right. Well, we're out of time now. So thank you for joining us, and I appreciate you making the trip over. And again, we're looking forward to continuing to working with BioCryst and looking for the next data updates and launch trajectory continued.

Thanks, everybody, for joining.

Thank you so much for having us.

Good day, and welcome to the BioCryst First Quarter 2026 Earnings Conference Call. [Operator Instructions]

Please note, this event is being recorded. I would now like to turn the conference over to Nick Wilder. Please go ahead.

Good morning, and welcome to BioCryst's First Quarter 2026 Corporate Update and Financial Results Conference Call.

Participating with me today are President and CEO, Charles Gayer; Chief R&D Officer, Dr. Sandeep Menon; and Chief Financial Officer, Babar Ghias.

A press release and slide presentation about today's news are available on our Investor Relations website. Today's call contains forward-looking statements, including statements regarding future results, unaudited and forward-looking financial information as well as the company's future performance and/or achievements. These statements are subject to known and unknown risks and uncertainties, which may cause our actual results, performance or achievements to be materially different from any future results or performance expressed or implied in this presentation. For additional information, including a detailed discussion of these risks, please refer to Slide 2 of the presentation.

In addition, today's conference call includes non-GAAP financial measures. For a reconciliation of these non-GAAP financial measures against the most directly comparable GAAP financial measure, please refer to the earnings press release available on our Investor Relations website.

I'd now like to turn the call over to Charlie.

Thanks, Nick. 2026 is off to a very good start for BioCryst, marked by strong execution on our commercial and development programs, the smooth integration of Astria Therapeutics and disciplined management of our finances. ORLADEYO net revenue of $148.3 million for the quarter was right in line with our expectations, and monthly new patient prescriptions have tracked slightly ahead of 2025 averages. The pediatric launch -- pediatric indication launch is just beginning, but early signals confirm the need for oral prophylaxis for kids with HAE.

We have received prescriptions for each of the 4 product strengths of ORLADEYO pellets, which demonstrates that even younger children need prophylaxis. We are committed to bringing oral prophy to the many kids who need it. We have also recently discovered a manufacturing issue that will delay the first product fulfillment, and our team is working closely with our manufacturing partner to identify the root cause. We expect to have more information about the product readiness later this quarter, and we do not expect this delay to affect our revenue guidance for 2026. We look forward to bringing ORLADEYO to the kids who need it as soon as possible.

The pediatric indication is exciting, but it does not distract our team from driving new patient demand for ORLADEYO capsules. We are pleased that new prescription demand for ages 12 and up remains consistent with our quarterly averages since launch despite new competition. Physicians and patients continue to trust ORLADEYO as an effective and proven option for HAE prophylaxis.

Turning to our pipeline development. Progress on the pivotal ALPHA-ORBIT trial for navenibart has exceeded our expectations. Enrollment will be completed at the -- by the end of next month and at approximately 145 enrolled patients, ALPHA-ORBIT will be the largest pivotal trial ever for HAE prophylaxis. The speed of enrollment is a testament to our team's execution as well as the attractiveness of navenibart profile. Our Phase 1 study for BCX17725 in Netherton syndrome is also hitting its stride. Investigator enthusiasm has been strong. Patients have started dosing, and we are on track to have proof-of-concept data by the end of the year in this high-need rare disease.

I am thrilled that Dr. Sandeep Menon has joined us as Chief R&D Officer last month. We're making great progress in our pipeline and adding Sandeep makes us stronger. He has a track record of disciplined and successful drug development, and he shares our vision of building great value through serving rare disease patients.

I'll turn it over to Sandeep to introduce himself.

Thank you, Charlie. I'm very excited to be joining BioCryst at this important inflection point in the company's evolution. The company is in a unique position of strength, especially from our strong performance of ORLADEYO. It's not just the commercial excellence that drew me to BioCryst, but the commitment to rigorous science to improve patient lives.

I see a tremendous opportunity to build on the momentum that ORLADEYO has delivered as we guide the next wave of programs through the clinic. Navenibart, our injectable plasma kallikrein inhibitor for HAE prophylaxis will complete enrollment in the ongoing pivotal Phase 3 ALPHA-ORBIT study by the end of June this year. This keeps us on track to submit a regulatory filing in the U.S. by the end of next year. Navenibart has generated compelling clinical evidence so far. In the long-term open-label ALPHA-SOLAR study, it recently demonstrated 92% and 90% mean attack reductions in the 3-month and the 6-month dosing regimens, respectively.

We now have a great opportunity to bring potentially best-in-class injectable to HAE patients that will complement our best-in-class oral ORLADEYO. Moving on to our next program, BCX17725, which is a KLK5 inhibitor, a potentially first-in-class therapy for Netherton syndrome, a very severe skin condition with no targeted or approved therapies for patients.

I'm happy to share that we have started dosing patients in Part 4 of the ongoing Phase 1 study. Part 4 will enroll up to 12 patients with 3 months of dosing, and we expect to report this data by end of this year. Beyond BCX17725, we will continue to be disciplined in what we pursue, both internally and externally focusing on rare diseases, which play to our strengths. I'm excited to have the opportunity to shape the next chapter of BioCryst's growth. We have a proven track record in HAE, exciting assets progressing in the clinic and now a clear strategy for further expanding our presence in rare disease.

I look forward to updating you on our continued progress over the course of the year. I will now transition to my colleague, Babar Ghias.

Thanks, Sandeep. In my remarks today, I will be referring to non-GAAP figures, which are adjusted for revenues and expenses related to our European ORLADEYO business, stock-based comp and expenses related to the acquisition of Astria. This acquisition was classified as an asset acquisition for accounting purposes. And as a result, we recorded an in-process R&D charge of $698 million in Q1 as well as some other transaction-specific charges. I encourage you to review our press release for additional details on these adjustments. We believe that non-GAAP figures provide a clearer view of the strength of our business on a forward-looking basis, and we encourage you to focus on these metrics in your analysis.

With that said, we are off to a strong start in 2026 with first quarter results reflecting continued momentum in ORLADEYO, further demonstrating the product's durability in an HAE market where there are increasing options for patients. During the quarter, not only did we deliver strong top line growth, we also posted a strong non-GAAP operating profit. We are pleased with the consistency of our profitability trend that is adding to our strong balance sheet position.

Additionally, we have been very pleased with the overall integration of Astria Therapeutics into BioCryst family. This process has been running ahead of our expectations. This demonstrates that our team can, in the future, not only do transformational BD, but also integrate seamlessly.

To shed more light on our financial figures, our non-GAAP Q1 2026 total revenue increased approximately 17% year-on-year. Since other revenues include contribution from RAPIVAB and licensing revenues, I would draw your attention to the ORLADEYO revenues of $148 million, which increased 21% year-on-year, excluding the European divestiture impact. New prescription demand is strong, and we continue to see growth in prescribers even in the sixth year of launch. We remain very excited about the future growth prospects for ORLADEYO as more prescribers get experience with the pediatric formulation and the commercial team continues to reinforce and expand the value proposition of ORLADEYO.

In Q1, our non-GAAP operating profit came in at $54 million, an increase of 25% year-on-year, further demonstrating our ability to convert strong top line growth to bottom line growth. R&D costs increased in Q1 2026 versus the prior year, as you would expect, since we are now consolidating the costs related to navenibart. To refresh from the last call, we anticipate that 2026 R&D costs will increase over 2025 as we complete the ongoing Phase 3 trial and BLA-enabling CMC activities for navenibart.

With the addition of Sandeep to our team, we will continue to refine a focused and disciplined R&D strategy to enhance our portfolio. To that end, we will continue to evaluate internal programs that do not make viable business sense. And as part of that evaluation during Q1, we decided to discontinue the development of avoralstat in DME. Our sales and marketing expenses for the quarter were $37 million on a non-GAAP basis, down slightly from Q1 2025. We are very pleased that our sales and marketing structure is at steady state. And while there may be some smaller increases in variable expenses, the current team is well-sized to support continued ORLADEYO growth.

We anticipate sales and marketing expenses supporting our HAE franchise, ORLADEYO and navenibart upon potential approval as a whole will be very stable and poised to deliver substantial returns. Our G&A expense increased slightly by $1.8 million over Q1 2025 on a non-GAAP basis. This increase was primarily driven due to incremental overhead with the closing of Astria. We will continue to monitor our G&A over the course of 2026 and explore further areas of efficiencies.

Driven by our strong operational results, we ended the first quarter with substantial liquidity of approximately $261 million in cash and investments despite funding part of the Astria purchase price from our balance sheet. During the quarter, we also closed on a senior credit facility of $400 million to fund the remaining cash portion of Astria acquisition, along with approximately 37 million BioCryst shares issued to Astria shareholders.

Our cost of capital decreased compared to last year due to our strong financial position, and you will notice the benefit year-on-year in our interest expense. Earlier this week, we finalized the license agreement with Neopharmed Gentili to commercialize navenibart in Europe. We are pleased to be collaborating with NG on this transaction. A team that carries a unified vision to benefit people living with HAE and a commercial team that carefully developed over many years before transitioning to NG as part of our European divestiture last year.

As part of this deal, we will receive $70 million in cash upfront and up to $275 million in future regulatory and sales milestone, along with tiered royalties on net sales ranging from 18% to 30% overall. This will increasing -- meaningfully strengthen our balance sheet in the near to medium term and naturally the downstream economics will be attractive to our overall financial profile. On a pro forma basis, including the net proceeds from the license agreement, our liquidity position stands at a total of $331 million as of March 31, 2026. This attractive position allows us to evaluate a wide range of capital allocation strategies to maximize value to our shareholders.

Moving on quickly to guidance. As Charlie mentioned, we are maintaining expectations for full year 2026 ORLADEYO revenues to be between $625 million and $645 million. We expect full year 2026 non-GAAP OpEx to be between $450 million and $470 million. We continue to execute well. And as the year progresses, we will guide the Street of any changes. In closing, we have entered 2026 with strong momentum and are pleased to see strong trends in early Q2.

Our goal is to keep driving top and bottom line growth, advancing our pipeline through both organic innovation and selective disciplined BD to accelerate our impact in the rare disease space. We are delighted to be sharing these positive business updates with you all today.

And operator, we are now ready for the questions.

[Operator Instructions] Your first question today will come from Jessica Fye of JPMorgan.

This is [ Abdullah ] on for Jess. Just 2 questions from us. What are your expectations for the deucrictibant XR's pivotal readout? And what profile do you expect? And then what are the latest trend -- what are your latest trends on paid rate in each payer segment?

Sure. For deucrictibant, as we've said before, when we do a lot of work to try to predict the future. We have forecasting models that have proven to be really accurate launch to date, really predicted the growth of ORLADEYO. We always give our future competitors their best profile. So what we assume is deucrictibant will have very good efficacy when they report out in Q3. And that's built into our future forecast. And we still believe that ORLADEYO is on a path and will reach $1 billion in peak sales.

And as far as the trends in the paid rate, we're still -- this year, we're still in the blizzard season where we go through all the reauthorization. Every year, it moves a little bit into the future as patients go through this process. So we're still in that process. We'll comment more at the end of Q2. But we're having really good success converting patients from long-term free product to paid product. So we're progressing as we expected.

Your next question will come from Tazeen Ahmad of Bank of America.

This is Jeremiah on for Tazeen. Maybe a couple of questions from us. Just first on the navenibart out-licensing deal. Can you maybe just help us understand how much of that $275 million milestone pool is tied to regulatory versus commercial thresholds? And then just where you expect that royalty rate to settle at scale? And then maybe a question on pipeline, especially considering the prioritization of avoralstat. Just wondering, we haven't heard many updates about the complement pipeline in some time.

Just wondering what are the next key decision points for bringing those programs forward?

Babar, you want to take the royalty question? I'll cover the pipeline.

Yes. So I think at this point in time, we're not necessarily breaking out the milestones and think we're very excited that upfront is a very sizable upside for an asset at this stage and naturally in sort of in line with some of the past licensing deals at this stage. As you can see that we feel very, very confident of that healthy royalty rate because, as I mentioned, it's a team that we actually developed and curated over many years. So we're very confident that the team will do a great job, and we'll realize the maximum benefit of that royalty rate. But you can imagine that a typical deal on the back end in terms of things, but something that we feel really confident to realize over the course of time.

And then as far as the pipeline, number one, what we're focused on right now is the 2 programs that we have in clinical development. So navenibart in late stage, and then we're very excited about the potential for 17725, given the need in the Netherton's population. With Sandeep on board, we will be making future updates on our pipeline and our rare disease strategy, and we look forward to doing that as soon as we can.

Your next question today will come from Laura Chico with Wedbush Securities.

I guess back to ORLADEYO for one. Charlie, I'm not sure if you can share any feedback here about the impact of some competing launches right now. I guess I'm thinking about DAWNZERA, but what are the impacts you're seeing on ORLADEYO retention? Has this changed your call strategy with physicians at all? And then just a follow-up with respect to the manufacturing issue. I think I missed it, but any impacts? Or could you just expand a little bit more with implications on the pediatric launch?

Sure. Yes. Laura, as far as the competing launches, what we're seeing is what we expected, and this kind of goes back again to the forecasting we do. The recent launches, as you know, have been injectables. And so what we see is they're competing mainly with the existing market leader, TAKHZYRO. And so it's not affecting ORLADEYO. And as Babar and I both mentioned, our demand is as strong as it's ever been, and we're really pleased, not surprised, but really pleased to see that.

And so that's why we have that continued confidence about the future growth of ORLADEYO and heading to the $1 billion in peak sales. And our retention rates, you asked about that are also in line with past expectations. Patients who start on ORLADEYO, 60% of them get to a year and then very slow or very sticky after that, very strong retention after a year.

On the peds manufacturing, as we said, we're not changing our guidance. We'll have more information on the issue and timing, hopefully later this quarter. But we're not changing our guidance because the early demand has been very strong. And you may recall from past calls, in our forecast for this year, we were relatively conservative about the peds opportunity because we didn't know how quickly it would kick in. So we're very bullish on the long term, and we're on track for this year.

The next question will come from Brian Abrahams of RBC Capital Markets.

Two from me. I guess, first on the navenibart Phase 3. It sounds like enrollment has gone really well there. So I'm wondering if you could talk about any learnings there just in terms -- from the enrollment conduct, just in terms of the appetite for long-acting injectables, the types of patients who could go on this therapy commercially and the potential size of that opportunity?

And then just secondarily, following up on the manufacturing issue. Can you just give us a sense of what would need to be done to resolve this? Might this require any sort of FDA reinspection? Is there any overlap at all with this facility with regards to ORLADEYO for adults or navenibart? And could there be upside to your guidance if this resolves more quickly than expected, just given that you're seeing good launch demand already, and I know pediatric revenue was not really included all that much in your guidance?

Sure. Thanks, Brian. Yes, first of all, navenibart, we're really excited about the pace of the enrollment. And as I said in my remarks, I think it is a reflection of the appetite that both patients and physicians have for an every 3- or 6-month dosing. This is why we wanted to acquire this product in the first place because we saw that, we heard that from customers. Getting to 3- and 6-month dosing is really meaningful and transformative. And so we think there's a potential to switch a lot of patients to this. There's -- as we've described before, there's two segments in this market. There are those patients who want oral therapy and do well on it. And then there's those who are on injectable therapy and are very comfortable with that.

And the profile of navenibart is something that's really understandable to both physicians and patients. And I think that's, again, reflected in the trial enrollment. So we're excited about that future launch. As far as the manufacturing issue with ORLADEYO pellets, first of all, this is -- it's a different plant. It's a different manufacturer than capsules. So it has nothing to do with capsules. It's not an FDA issue at all. It's not a safety issue. It's just -- it's a batch problem in the specifications. We're digging in to get to the root cause so that we can manufacture consistent batches going forward. So we'll have an update on that timing when we have it. But this -- we do not expect this to be a long-term problem.

And as far as the demand for the pediatric indication so far, it has been very strong. And so if we get this issue, we get the product out there in the relatively near future, we're right on track for this year and certainly very much on track for our long-term predictions.

The next question today will come from Steve Seedhouse of Cantor.

I wanted to see if you'd be willing to frame your expectations for the Phase 3 navenibart data. Obviously, most Phase 2s, including this one in HAE smaller than the Phase 3 would be, but the attack rate reduction was pretty profound in that Phase 2.

So are you expecting like a greater than 90% attack rate reduction? Are you expecting that in both the every 3 months and the every 6 months arms? And is that what's framing pretty aggressive guidance, the $1.8 billion in 2033 sort of implies an even better launch than ORLADEYO. So I was hoping you could just frame what you're expecting from the data.

We are expecting really good results, whether it's 90%, a little over 90%, a little less, I don't think that really matters so much. What matters is the attack rate that patients get down to. And in the open-label study, as you've seen, patients in both doses are getting down to a mean attack rate of just 0.16 per month. So that's less than 2 attacks per year. And those attacks tend to be more mild than other attacks. So that is functionally attack-free for patients. And to be able to get that from 3- or 6-month dosing, we do expect there to be comparable efficacy between the 2 because remember, the 6-month dosing is twice the dose of 3 months. And so that Phase 2 ALPHA-SOLAR data is very important, really gives us confidence for the future.

The next question will come from Stacy Ku of TD Cowen.

Welcome to Sandeep. So first, just as we think about ORLADEYO, I noticed that you had talked about the continued growth in prescribers. So just curious if you could further elaborate there. That's the first question. And then a quick follow-up on the pediatric product fulfillment. It sounds like you need a quarter or 2 to kind of get more information? Or is it to resolve the fulfillment issue? So just help us understand if the base case assumption for the potential delay is potentially within the year. That's two.

And then three, as you started to dose another patients, just maybe talk a little bit more about what you're learning about the patient population, diagnosis awareness, potential size of the market and remind us your go and no-go decision on efficacy.

Great. Thanks, Stacy. Let see if I can get all these. In the growth of prescribers, you've heard us talking before in 2025, around 60 new prescribers per month, give or take. We're in that same range in Q1. So as Babar said, in year 6 to still be adding prescribers to still be getting the prescriptions at the same rate is really a reflection of this product profile and how our teams launched it.

As far as the peds pellet timing, as I said, we'll know more this quarter. Our expectation is we'll get this resolved pretty quickly. But we don't know the root cause. We haven't identified all the root cause yet. So it will just -- it will take a little bit of time. But based on what we see right now, we're on track for the year. And then as far as Netherton patients, we've done some work in the epi of this disease because that's really key. We know it's a very serious disease. We've met patients. We know how much they suffer from this. But the real key is what's the size of the market, what is the overall opportunity. And we've identified -- we have a high level of confidence that the U.S. market is 3,000-plus patients at this point. Those patients need to be correctly diagnosed. They need to be identified. But having a drug in the market is always a catalyst in rare disease for patient identification.

So the keys for efficacy, no drug in this space has to be perfect. What we'll want to see is that the patients are getting better in their overall -- the overall scales of measuring Netherton syndrome. So ichthyosis scales measured by the physicians and the patients, we'll be looking at each. We'll be looking at does the drug continue to get to the epidermis the way that we've seen in healthy volunteers. So a range of things that will help us design a pivotal program that we hope can start next year.

[Operator Instructions] Our next question today will come from Maury Raycroft of Jefferies.

Congrats on the progress. Maybe just a quick follow-up on Netherton. Can you just talk more about how much data we should expect by year-end in that data update?

Yes. Maury, we'll have up to 12 patients. That's what we're shooting for. And we want to release the data that we have altogether because it's a rare disease. That's not a huge number of patients, but we think it will give us the data we need to say, do we have a drug here. And so the package will come from that plus the 1 to 3 patients that we will have from the Part 3 of the study as well as the healthy volunteer data. So as the data comes in, we'll figure out what the package is at the end of the year, but it will be based on those roughly 12 patients.

Got it. Okay. And just for digging into prophy competition a bit more, are you hearing about more patients considering switching or switching from ORLADEYO? And even if you're not seeing an impact yet, are you getting more pressure or headwinds in capturing new patients or switches from TAKHZYRO? I guess it seems like ORLADEYO is resilient with these new launches. Are you doing anything differently?

Yes. We're really not doing anything differently. We're not -- we don't need to add to our sales force. We don't need to change our customers. We're already calling on the list of HAE prescribers and expanding that list as we've talked about. We see most of the switching, most of the market impact hitting TAKHZYRO, not ORLADEYO. Of course, patients switch from ORLADEYO all the time. 60% of them get to a year, 40% don't, and they switch to other products. And what we're seeing more is those patients when they do switch, they're more likely to switch to one of the new products, which makes a lot of sense. But the impact overall on ORLADEYO has been very minor.

The next question will come from Jon Wolleben of Citizens.

This is Catherine on for John. Thank you for the color on the ORLADEYO launch. I was wondering if you could provide a little bit more commentary on kind of ex-U.S. sales beyond Europe, if you guys -- which you guys are seeing there and kind of plans for any expansion and then your thoughts about the same for navenibart.

Sure. Thanks, Catherine. With our sale of the European business, Europe had been the large majority of our ex-U.S. sales. So ex U.S. is still an important contributor towards our peak, but we are -- the vast majority, well, over 90% of our revenue now comes from the U.S., and we expect it to be that way even as the brand grows towards $1 billion. We are though committed. We want to get our drugs to patients around the world because HAE is a global disease, and there are patients who need it. But from a revenue perspective, the great majority will be the U.S.

And I'm sorry, the question on -- you had a question on navenibart.

And do you think for navenibart, you're going to kind of see the same trend if -- kind of European market in the majority of ex U.S.

We would expect it to be largely the same as Babar was describing, our partners at Neopharmed Gentili are equally excited about this drug and having both ORLADEYO and navenibart in the portfolio, there's an important place for both of these products in all the different markets. And so we're excited about that opportunity.

The next question will come from Gavin Clark-Gartner of Evercore ISI.

This is Yesha on for Gavin. We were just wondering if on the pediatric pellet side, are you able to proactively work through payer access and reimbursement while resolving the manufacturing? Kind of also wondering how quickly you could convert the demand to paid drug when that's resolved.

Yes. Thanks for the question. Absolutely, we've been doing that already. And we'll continue to do it. The ORLADEYO pellets slot right into our existing contracts for ORLADEYO capsules. So it's really not a separate market access initiative. And so our patient services team will help patients and health care providers work through that process. And that could create patients moving more quickly to paid therapy once we do have the product supply.

And at this time, we will conclude our question-and-answer session. I'd like to turn the conference back over to Charles Gayer for any closing remarks.

Thank you. Again, as Babar and Sandeep and I have described today, 2026 is off to a really strong start for BioCryst. I'm very happy with the team we have in place here, the way that we're executing on our commercial and development programs. And I believe that the best is yet to come for BioCryst.

Thank you for your interest, and have a great day, everyone.

The conference has now concluded. We thank you for attending today's presentation, and you may now disconnect your lines.

Good day, and welcome to the BioCryst Fourth Quarter 2025 Conference Call.

[Operator Instructions]

Please note this event is being recorded. I would now like to turn the conference over to Nick Wilder with BioCryst. Please go ahead.

Good morning, and welcome to BioCryst's Full Year 2025 Corporate Update and Financial Results Conference Call.

Participating with me today are President and CEO, Charlie Gayer; Chief Financial Officer, Babar Ghias; and Chief Development Officer, Dr. Bill Sheridan.

A press release and slide presentation about today's news are available on our Investor Relations website. Today's call may contain forward-looking statements, including statements regarding future results, unaudited and forward-looking financial information, as well as the company's future performance and/or achievements.

These statements are subject to known and unknown risks and uncertainties, which may cause our actual results, performance, or achievements to be materially different from any future results or performance expressed or implied in this presentation.

For additional information, including a detailed discussion of these risks, please refer to Slide 2 of the presentation.

In addition, today's conference call includes non-GAAP financial measures. For a reconciliation of these non-GAAP financial measures against the most directly comparable GAAP financial measure, please refer to the earnings press release available on our Investor Relations website.

I'd now like to turn the call over to Charlie.

Thanks, Nick. This is my first earnings call as CEO of BioCryst, and I'm happy about where the company is today and even more excited about our future.

We closed 2025 with strong momentum, delivering full-year ORLADEYO revenue of $601.8 million. That was up 38% for the year and 43% when you exclude our Europe business that we sold in October.

We are also starting 2026 on a high note as we expanded our HAE portfolio with our acquisition of Astra Therapeutics last month. As I step into my new role, I want to be clear about BioCryst's strategy.

We are and will remain a profitable rare disease company committed to meeting the unmet needs of patients through commercialization, innovation, and excellence that is backed by well-understood biology and disciplined clinical development.

Where we will continue to evolve is how focused and explicit we are about capital allocation and accountability. We want to ensure that every dollar we deploy has a clear line of sight to driving long-term value creation.

Coming back to our HAE portfolio, we see a tremendous opportunity to build value by meeting the needs of a growing number of HAE patients.

We view HAE not as a winner-take-all efficacy race, but as a structurally segmented market, driven by biology, patient preference, and real-world experience.

Rather than a market that resets with every new entrant, we see a market that segments based on the needs of individual patients.

We now have a portfolio of differentiated products in ORLADEYO capsules for ages 12 and up, ORLADEYO pellets for younger kids, and a late-stage asset in Navenibart.

Each of these therapies will allow us to achieve growth and durable revenue within specific segments of the market. ORLADEYO has grown strongly in part because of its differentiation as the oral option.

But more importantly, there is a "super responder" population that can get injectable-like attack control. We saw in our pivotal trial that just over 50% of patients starting on ORLADEYO stayed on for 2 years and had a 91% reduction from baseline.

In the real world, 60% of patients stay on therapy through 12 months, and nearly 50% of all patients who have tried ORLADEYO in the U.S. over the past 5 years are still on therapy.

Most ORLADEYO super responders are unlikely to switch even if another oral option reaches the market because their needs are already met.

And now we have a new member of the ORLADEYO family. We are excited to launch ORLADEYO pellets for kids ages 2 to under 12 at the Quad AI conference this weekend.

The unmet need is significant because HAE and related attacks are underdiagnosed in younger kids, and prophylaxis usage is only half that of adults.

Availability of a safe, effective, and targeted oral prophy has the potential to change how kids with HAE grow up, and ORLADEYO is likely to be the only oral option for several years to come.

We think about Navenibart through that same lens of structural differentiation in HAE. Navenibart is not intended to replace ORLADEYO. It is intended to allow BioCryst to address patients' needs across the full spectrum of efficacy, dosing, and convenience preferences in HAE prophylaxis.

There are approximately 5,000 U.S. patients who have great attack control by injecting anywhere from twice a week to every 4 weeks. Most of them are reluctant to take a chance on oral because they are well controlled already, and the injections themselves are not a barrier to treatment. Oral is not their need.

But our research shows that many are very attracted to the idea of a simple, high-efficacy injectable dosed just 2 or 4 times per year. That is a leap patients dosing an injectable 12, 26, or even over 100 times per year are likely to make because it aligns with what they know and provides something better.

Our objective is to keep the HAE prophylaxis treatment decisions within the BioCryst portfolio. That is another way we think about long-term durability, not as defending a single product, but as owning the prophy decision framework in HAE.

We will offer three compelling options, all from a team that the HAE community knows and trusts.

Before turning to Bill, I want to briefly touch on BCX17725, our early-stage program in Netherton syndrome. This is a classic rare disease story - a devastating genetic condition that is underdiagnosed because there are no good treatment options.

We are encouraged by the results in healthy volunteers and the investigator's enthusiasm for this program. We're on a path to generate clinical data in patients by the end of the year, and we'll use that evidence plus feedback from patients and investigators to guide next steps. 

Looking ahead to 2026 and beyond, we see durable revenue growth anchored by a skilled, motivated and resilient commercialization team, meeting the needs of adults and kids who want oral HAE prophylaxis, a second molecule advancing well in late-stage development that has the potential to lead the injectable prophylaxis segment and additional rare disease optionality in our pipeline, positioning BioCryst for sustained value creation.

With that, I'll turn it over to Bill to provide more color on our pipeline.

Thank you, Charlie. I'll cover our HAE programs to start with and then provide a brief update on our Netherton syndrome program.

First, the Navenibart pivotal Phase III trial continues to recruit very well with strong enthusiasm for the study from investigators and potential trial patients. We expect to complete enrollment of the required 145 patients around the middle of 2026. 

The primary efficacy analysis of the alpha-Orbit pivotal trial will be the comparison between each navenibart dosing regimen and placebo with the time-normalized rate of investigator-confirmed HAE attacks through 6 months.

The Phase II efficacy and safety profile that we are reporting at Quad AI this weekend from the ALPHA-SOLAR Trial is excellent, with no safety signals in 29 patients through up to 24 months of dosing and a reduction from baseline in mean attack rates of 92% for every 3 months of dosing and 90% for every 6 months of dosing. 

Overall, the mean attack rate decreased from 2.23 per month at baseline to 0.16 per month during navenibart treatment. For both dose regimens, the median attack rate reduction was 97%.

These are outstanding results. These strong results illustrate the durability, consistency, and quality of treatment responses with navenibart and provide high confidence that the pivotal trial will be successful. 

We expect the pivotal trial results to confirm that navenibart every 3 months or every 6 months will set a new standard in the field and provide a very attractive choice for HAE patients seeking injectable prophylactic therapies. 

Second, we are thrilled that our application for ORLADEYO oral pellets for children aged 2 to less than 12 was approved by the FDA in December 2025.

We're now continuing with marketing authorization applications in other major regions with the goal of transforming treatment choice for patients, parents, and children with HAE around the world. 

Third, our clinical development program for our KLK5 inhibitor, Fc fusion protein BCX17725, in Netherton syndrome, has now moved into patient-focused research.

The healthy volunteer parts 1 and 2 of our Phase I trial with single and multiple ascending doses have been completed. BCX17725 was administered by subcutaneous and intravenous routes in these healthy volunteer cohorts. 

Our investigational drug was safe and well-tolerated. There were no discontinuations, no dose-related adverse findings, and no safety signals.

The top dose administered was 12 milligrams per kilogram every 2 weeks for 3 doses. And as noted in our last call, we were pleased to see evidence of the drug being distributed to the epidermis.

Drug exposure was approximately linear in proportion to dose, and the estimated half-life was about 12 to 19 days, supporting continued study of every 2-week administration schedules. 

Today, I'll provide a refresher on study design and an update on progress in the Netherton syndrome cohorts. The study design is outlined on Slide 18.

The patient cohorts in the study are open-label and designed to evaluate potential effects of the drug on clinical signs and symptoms of Netherton syndrome, as well as safety and drug exposure. 

There are 2 patient cohorts, a short-term administration cohort in Part 3 with 4 weeks of dosing and a longer-term cohort in Part 4 with 12 weeks of dosing.

Some sites were activated for Part 3 after short-term nonclinical safety studies were completed, and subsequently, were activated for Part 4, once we had longer-term nonclinical safety studies done.

We are prioritizing recruitment into Part 4 as this will give us a longer dosing experience, and we anticipate that no more than 3 patients will be entered into Part 3. 

Our clinical investigators are excited about the potential for this drug in Netherton syndrome and have identified patients who could be eligible. So, we expect to recruit up to 12 patients in Part 4 and generate results by the end of this year.

For efficacy, the primary efficacy endpoint is change from baseline in the Ichtheosis Area and Severity Index, otherwise known as the IASI score, and key secondary endpoints include the Investigator Global Assessment score and the worst itch numerical rating scale score. We will also evaluate quality of life metrics. 

We intend to select doses and endpoints for a pivotal trial based on what we see in this Phase I trial. I'll now turn the call to Babar for the financial review.

Thanks, Bill. Last year was a defining year for our company. We delivered strong top-line growth, record profitability, and reinforced our strong balance sheet position.

Those results weren't just numbers. They were proof that our strategy is working and our operating model is built for scale. 

Before I turn to financials, I want to highlight that we are providing more clarity in our financials to enable a better understanding of the strength of our core business. Please refer to today's press release for our GAAP financial metrics. 

In my remarks, I will be referring to non-GAAP figures, which are adjusted for the sale of the European ORLADEYO business, stock-based comp, workforce reduction costs, and transaction-related costs.

We believe that non-GAAP figures provide a clearer view of the business on a forward-looking basis. 

Our non-GAAP 2025 total revenue increased 45% year-on-year. Since other revenues include contributions from Rapivab, which is non-core to our business, I would draw your attention to the non-GAAP ORLADEYO revenues, which increased by approximately $169 million or 43% year-on-year. 

This was a result of phenomenal day-to-day execution by our commercial team over the course of 2025. 

By leveraging our superior real-world evidence generation capabilities, we successfully drove higher patient volume and made significant progress on paid shipments. We have already started to see the impact of the European divestiture on our operating performance in Q4. 

Our non-GAAP operating profit jumped to $214 million, an increase of 198% year-on-year, the highest ever in BioCryst's history. R&D costs came down slightly in 2025 as we progress key programs while winding down some others and realigning the team structure.

We anticipate that 2026 R&D costs will increase over 2025 as we complete the ongoing Phase III trial and BLA-enabling CMC activities for Novenibart. 

These activities, once complete, will naturally bring down development costs beyond 2026. We will remain razor-focused on maintaining R&D spending discipline and allocating capital to high ROI opportunities.

In the same spirit, we will quickly terminate programs that do not have a compelling path forward. 

Our sales and marketing expenses for the year were $144 million on a non-GAAP basis, which were primarily up due to some reallocation methodology, prelaunch costs for pediatrics, and higher specialty distribution fees and incentive comps naturally owing to the strong top-line growth. 

More importantly, as you can calculate, for every dollar invested in our sales and marketing engine, we generated an approximately 4x return on ORLADEYO net sales.

While we do anticipate some small incremental annual expense tied to top-line growth, the ROI on ORLADEYO will continue to expand as we drive the business toward its blockbuster potential. 

Looking further ahead to potential approval of Navenibart, the sales and marketing expense supporting our HAE franchise as a whole will be very stable, predictable, and carry an even greater ROI upside.

We have built one of the best rare disease commercial organizations in the industry, a highly scalable infrastructure that will enable us to deliver multiple successful launches in the years to come in HAE and beyond, whether it's another candidate from our pipeline or something that we acquire in-license. 

Driven by our strong operational results, we finished the year with a formidable liquidity position of $337.5 million in cash and investments on hand.

Concurrent with the closing of the Astria acquisition, we entered into a highly attractive $400 million financing facility with Blackstone Life Sciences, a financial partner that is aligned with our vision of growth. 

With the sustained momentum, coupled with the added benefit that now, for the next 2 years, we will be able to utilize our prior period tax NOLs, we will be in a very strong cash flow-generating position.

This will afford us optionality to evaluate a wide array of capital allocation strategies that reinforce durable value creation, be it M&A, debt paydown, or buybacks. 

Moving on to guidance. We are maintaining expectations for full year 2026 ORLADEYO revenues to be between $625 million and $645 million, which at the midpoint represents approximately 13% growth over 2025 revenues adjusted for Europe.

We expect full-year 2026 non-GAAP OpEx to be between $450 million and $470 million, which now includes expenses on Astria as previously guided. 

As Charlie emphasized, we remain very confident that ORLADEYO is on a solid footing to achieve blockbuster potential. We continue to see patient growth driven by the trends that we explained earlier, coupled with the recent pediatric approval, which will be an important component of the growth.

After turning over this profitability card in 2025, we are very committed to staying profitable and continuing to drive cash flow generation going forward. 

To summarize, as we reflect on 2025, it is clear that the strength we delivered this past year is more than a financial milestone. It's a springboard for what comes next.

We are entering 2026 with momentum, a sharpened competitive edge, and a discipline that ensures every investment we make is working towards value creation. 

Our goal is to keep advancing our pipeline through both organic innovation and selective, disciplined BD that can expand our capabilities and accelerate our impact in the rare disease space.

We are very excited to keep building the next growth phase of BioCryst, a company that not only performs quarter-to-quarter, but compounds value over the long term as we execute on that vision. Operator, we are now ready for your questions.

[Operator Instructions]

Our first question comes from Laura Chico with Wedbush Securities.

I guess I wanted to start off on Navenibart. Could you talk a little bit more about the timing for the regulatory submission by year-end '27?

Does that assume Phase III data still arriving by early '27? And I guess I just wanted to understand the steps that have to occur between top-line data and submission. 

And then, related to that, you mentioned the Quad AI late breaker. How should we think about this, I guess, in relation to ALPHA-STAR? It seems quite consistent in terms of the attack rate reductions. I'm wondering if there's incremental learning here, around maybe an attack-free period.

Thanks, Laura. Yes, we're clearly super excited about Navenibart. And yes, everything is on track for filing, such that we would be on track for filing by the end of next year. And so on track for approval by late 2028.

Bill, do you want to answer the question just about the regulatory process?

Sure. Like for other prophylactic therapies in HAE, 12 months is a chronic condition. You need 12 months of safety that will be delivered in mid-'27.

And that's really what's driving the timing of the BLA submission. And what was the final question?

And then the final question, just the data, yes, we're really excited about the data, the 92% reduction mean reduction for the 3-month dose, the 90% for the 6-month dose, just shows incredible consistency.

I think what's also really important is the mean attack rate of 0.16 across the population from their baseline. That's fewer than two attacks per year for patients plus the severity of the attacks went down as well.

So, for most of the year, patients are functionally attack-free, and that's what patients are looking for.

Our next question comes from Brian Abrahams with RBC Capital Markets.

Congrats on the continued strong progress. You talked a little bit about the ORLADEYO super responders staying on with good persistence for long periods of time.

I guess, do you have any sense of how to predict who would be a super responder? And then just maybe along those lines, I'm curious how you envision positioning Navenibart in that context in terms of whether you push patients to switch to ORLADEYO?

And then if they don't respond, Navenibart could be an option for them? Or would you be primarily positioning Navenibart for those 5,000 patients doing well on injectables who could use something that's less frequently dosed?

Then, just maybe remind us of some of the aspects of the profile for Navenibart in terms of the number of injections, anti-drug antibodies, refrigeration requirements, just anything else that needs to be done with regards to formulation ahead of commercialization.

Great. Thanks, Brian. I'll start, and then I'll have Bill answer some of those questions as well.

As far as the predictability of the super responders in ORLADEYO, there really is no way to predict other than for patients to try. So, first of all, patients have to want to be on an oral, and we know that the majority of patients actually would prefer an oral.

But as we've looked at all of our clinical data, all the different factors, age, sex, prior prophy history, weight, everything else, there is nothing that can predict who is going to respond.

As we know, HAE attacks are often driven by stress and other life factors. And so, I think our strategy is to try to get patients who are interested in oral to try.

Most of them do great. We want them to do a 3- to 6-month trial to really figure out if it's the right drug for them. And as we see, by a year, about 60% of them realize that it is the right drug for them.

As far as the Navenibart positioning versus ORLADEYO, we see the primary opportunity for Navenibart to be those 5,000 patients on injectables. Like I said in my remarks, those patients are on injectables because they're doing well, but some of them are injecting 100-plus times a year.

And so, to be able to do just 2 to 4 injections, we think, is going to be really compelling, and that's what we see in our patient research.

So ORLADEYO then is going to be for patients who want to start prophy on oral, it's going to be the known, the trusted option with many years of data and experience.

So ORLADEYO is for anyone who wants oral. Navenibart is for people who want an even better injectable positioning. And then for those patients who try ORLADEYO and it's not the drug for them, that also is an opportunity for Navenibart, all within the same BioCryst portfolio.

For Navenibart, the number of injections is really going to be very simple. So, it's going to be launched with an auto-injector and the 3-month dose after a 600-milligram loading dose, which will be 2 injections, 2 milliliter injections.

The 3-month dose is then 1 injection. The 6-month dose is 2 injections. So very simple.

And then, Bill, there was also a question just around ADAs and other things.

Yes. Before I get into that, with regard to predictability, I'll just reinforce what Charlie said. You have to try ORLADEYO to find out whether you're going to be a super responder.

And so, it benefits people in every category with HAE. So, in addition to age, sex, race, weight, prophy exposure, you can also add to that whether you have a high attack rate or a low attack rate, whether it's less or more predictable, whether you have type 1 or type 2 HAE or C1 inhibitor normal HAE, all of those categories benefit.

And we've shown that very definitively from both our clinical trials and our real-world evidence studies. So, you also asked about the maturity of the formulation development program for Navenibart. It's all done. It's very mature. CMC is in a great spot.

And then just a question about ADA?

With regard to ADA, there's no evidence of ADA impacting efficacy in the Phase II experience. And of course, with every biologic, it's part of the development program that you develop assays and look for ADAs; you always find them.

What matters is whether people continue to benefit from the drug. And so far, that is exactly the case. There's no evidence of ADA impacting either safety or efficacy.

And just to remind folks, the data being presented this weekend, these are patients on Navenibart who out to as far as 24 months with a mean of about 12 months.

So, one last thing about the injections, they don't hurt.

The next question comes from Steve Seedhouse with Cantor Fitzgerald.

This is Timurvaniov on for Steve. For Neethererton, we just wanted to clarify, are you guys going to be releasing Part 3 and 4 data at the same time?

And then also, could you talk about disease severity, the variability at baseline? Do you anticipate how difficult it would be to enroll more uniform patients?

And then what background treatments are allowed, and how patients proceed based on their disease phenotype?

Okay. I'll start with just the Part 3 and 4, and then Bill can talk about the disease severity and the patient types. Our plan is to release all the data together.

We're only going to have maybe 2 or 3 patients in Part 3. And as Bill said, we're now prepared across our sites to go into Part 4, and that 3-month dosing is what we think is really going to be meaningful.

So we don't plan to do one patient at a time. We want to release a complete data set. And then Bill, just talk about the patients.

With regard to the spectrum of severity, there is one for sure, in Netherton syndrome.

What we're finding from our research on the prevalence of disease, for example, is that, as Charlie said, it's underdiagnosed, and that's mostly because there are no approved treatments, but also because of the differences in severity from one patient to the next.

The patients we've met with this illness have obvious, really obvious disease, and they have adapted coping strategies. And that their lives have been dramatically impacted. That part of it, I'm not worried about in terms of recruiting subjects.

So the investigators that we have that are lining up their subjects are more worried about getting spots for their subjects in the trial rather than not having enough patients to put in the trial.

With regard to the eligibility, yes, we need to have evidence of illness so that we can identify whether there's a benefit from the drug. So we're doing that. We're selecting patients who have an obvious illness. And I think it will be fine. I'm not worried about that.

The next question comes from Maury Raycroft with Jeffries.

This is Amy on for Maury. Congratulations on the quarter. Just a follow-up on a previous question. Can you provide more specifics on how you would provide updates and disclosure around the Navenibart program?

And can you talk about your strategy to potentially get the FDA to accelerate the timelines?

Sure. So for Navenibart, as Bill mentioned, the enrollment is going well. And so we would probably update once we have the pivotal study fully enrolled. And then, sorry, what was the second part?

The second part is about doing our best to pull that forward as this program matures; that's obviously something we'll be focused on.

So, for example, elements of the BLA that we can start writing, we'll start to write. We won't have a crystal clear understanding of the timing of the BLA until two things happen. And one is the last patient's first visit, so that we can predict when the last visit is for 12 months later, obviously.

The next step is getting clarity with the division at a pre-BLA meeting on the total content of the BLA. And obviously, that comes later. So I think we'll be able to provide more clarity in due course.

The next question comes from Jon Wolleben with Citizens.

This is Catherine on for Jon. I just have a quick question about whether you guys are seeing any impact from the recent new entrants, including the oral acute therapies, and whether any patients are switching to ORLADEYO?

Are you seeing differences in the reasons for patients switching? I know there's not really been much of an impact on revenues, but if you expect any impact or if you're starting to see it at all? Any color on that?

Sure, Catherine. As we've said, particularly a lot last year leading up to new entrants coming in, we did not expect there to be an impact on ORLADEYO from new prophy entrants because there's a real difference between patients who want oral prophy and then patients who are more comfortable with injectables.

So we expected the injectables to be competing more with existing injectables, and that's what we're seeing. So it's not changing ORLADEYO prescribing patterns or patient patterns in general.

As far as oral on-demand, oral acute therapy, that's something we're certainly not seeing affect ORLADEYO negatively in any way. We think over time, there is a potential for a tailwind of just patients who want to be in an all oral combination, so one pill once a day to prevent attacks and then for the occasional breakthrough attacks, treat with another oral, that's a great opportunity for many patients.

But it's too early to say whether that tailwind is going to occur.

The next question comes from Serge Belanger with Needham & Company.

This is John on for Serge today. First, just on ORLADEYO. You guys took a 9% price increase in January.

Beyond that, curious which levers you'll be looking at most closely in '26, whether it be maintaining trends of new patient adds or making slight improvements on paid prescription rates, either in Medicare or commercial channels.

And then on the pellet formulation for pediatrics, curious how we should think about the pacing of patient identification and conversion throughout '26. And does your current guidance assume any material contribution from this segment this year?

Great. Thanks, John. Yes, we did take up a 9% price increase in early January, which is higher than we've done in the past. We'll net about half of that, so about 4.5%.

So that is something more because ORLADEYO was a lot lower priced than most of the other products in the market. And so this was just a little bit of a catch-up, but not something that we need that kind of pricing going forward to get to our long-term peak of $1 billion.

For this year, the KPI that is most important to us is net patient growth. And as we've said, and it's in our slides today, what we need is 150 patients net patient growth average per year for this year and 3 more years to hit $1 billion in 2029.

So we are very much within sight of getting to that $1 billion. And so that's the #1 thing. Of course, we're always working to improve the paid rate incrementally.

We made a big jump in the last year. And now it's just about making incremental improvements, and we're using our real-world evidence.

So, for example, in patients with normal C1 inhibitor, we're starting to see more plans adopt favorable coverage policies for this based on the real-world evidence that we're providing. So that's a constant process. 

Then, for the pellets, one of the things I mentioned in my remarks is that HAE is underdiagnosed in kids. We found about 500 patients in claims data for kids under age 12.

But statistically, based on the epidemiology, there should be 1,200. And one of the reasons is parents are sometimes reluctant to get their kids tested because they're frankly hoping their kids don't have HAE.

But the availability of an oral therapy, we think, and we've seen this in the early days of the HAE market, having a therapy encourages diagnosis. So there's a market growth opportunity. 

And then kids are only treated with prophy at about a 40% rate, which is half that of adults. And so there's a potential to up to double the number of kids diagnosed and up to double the treatment rate. And we think that an oral prophy is the thing to do.

Then, as far as guidance, yes, the peads launch is in our guidance for this year, but it's a really small part. We are very bullish long-term on what this indication is going to mean for kids and for revenue.

But what we don't know is how quickly that transformation is going to happen. And so we've been conservative in our thinking for this year. And then we'll see how it goes. But if it goes faster than we expect, it could be a tailwind.

[Operator Instructions]

Our next question comes from Stacy Ku with TD Cowen.

This is Vish on for Stacy. Congratulations on a great year, and I really appreciate your comments on the competitive dynamics.

We have a couple. So first, for ORLADEYO, expectations for Q1. Can you give us an idea of how the reauthorization process is progressing this year? We know you made some improvements in the process last year, which resulted in faster-than-expected reauthorizations.

So just walk us through what you're seeing and what we, and investors, should expect for Q1? 

Then, second and final for us, given the EU business sale, are you willing to split your 2026 guidance for U.S. and ex-U.S. contributions? How should we be thinking about that?

Great. Thanks, Vish. I'll take the first question and pass it over to Babar for the second question.

Every Q1 is the big reauthorization season. It's a ton of work. Our team prepares for it. They're right in the midst of that process, and our team has gotten really good at it. What you should expect for Q1, because this year, we don't have any huge tailwind like we did last year with the Medicare patients and the IRA, making it more affordable for patients.

The Medicare patients are in great shape. So we won't have that tailwind. 

So this year, you should expect revenue probably to be slightly down versus Q4 as we go through the reaff. We have to give away more free product. We have to pay a higher percentage of co-pays for the commercial patients.

And so that drops revenue even as our patient base continues to grow. So down a bit in Q1 and then it pops up again in Q2. And Babar, do you want to just talk about the U.S. versus global?

With respect to your question on the costs and contributions from Europe, if you look at our press release in the financial tables, we actually attempted to break out all that European business.

I think, as we have previously stated, that European business, while growing, was also loss-making. So you can actually see that our base business margins were incredibly strong compared to the U.S.

The U.S. business margins are incredibly strong compared to Europe. So when you look at that profitability metric that I quoted, the $214 million, that strips out all of Europe. And from the exhibits, you can glean that the base business costs are $380 million for the U.S. in 2025. 

To give you a perspective on what it looks like in 2026, and this goes back to the same cost discipline, we shut off Europe, but we added a very, very highly derisked late-stage program in Navenibart.

So our total costs are in the $450 million to $470 million range, of which the base business is actually not growing by much. The cost additions are primarily coming from adding Astria.

So that's the discipline that I talked about that we will continue to make sure that our base business costs remain low, and we continue to drive growth. I hope that answers your question.

Yes. My question was relating to the 2026 guidance, the $625 million to $645 million that we're expecting for this year. How should we think about the U.S. and ex-U.S. split there?

Yes. So a majority of that is going to be from the U.S. We have retained some markets. And as you can see, after Europe, the split is now it's a little bit over 90%. So, while we're not breaking out, the majority of that is coming from the U.S. business.

This concludes our question-and-answer session. I would like to turn the conference back over to Charlie Dyer for any closing remarks.

Thanks very much. 2026, as we've been describing, is a really big year for BioCryst. We've got continued ORLADEYO patient growth.

We're super excited about the launch of ORLADEYO for kids. A lot of important clinical trial execution for Novenibart and 17725 is going well. And I'd really like to thank all the hard-working owners at BioCryst for what they did to make 2025 a great year and what they're doing this year to deliver another year of great results.

So thanks, everyone. Have a great day.

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.

Great. Welcome. Good morning, everyone. My name is Jess Fye. I'm a biotech analyst at JPMorgan. We're so glad to have you here at the 44th Annual JPMorgan Healthcare Conference. We're continuing the conference with BioCryst. And first, you're going to hear a presentation from the management team, then we're going to go into some Q&A. [Operator Instructions]

But with that, let me pass it over to the company's CEO, Charlie Gayer.

Thank you. Good morning. Thanks, Jess. Thanks to the JPMorgan team for inviting us here this year. I'm here with Bob Ghias, our CFO; and Dr. Bill Sheridan, our Chief Development Officer. And this is a really exciting time to be taking over this year as CEO of BioCryst because if you've been following BioCryst over the years, I think you'll see that it's not the same BioCryst that you've seen before. We have some really exciting things going on.

Before I get started, my team and I will be making some forward-looking statements. Those statements have risks. You can read about them on Slide 2 or our website. And then we also will be making -- using some non-GAAP financial measures in this as we talk about last year's preliminary results and guidance for this year. 2025 was a really transformative year for BioCryst. We accomplished a lot.

First and foremost, ORLADEYO growth 2025 we saw the most new patient prescriptions in the United States since the first year of the launch. This was in year 5, which you don't normally see in a rare disease launch. We made great progress on paid rate improvement in the United States for ORLADEYO, ending Q1 at 84% and the year at 81%, and this compares to our long-term goal that I'll touch on more later of 85%.

We sold our European business. The business was going great, but as one product in Europe, it was not profitable for us. And we sold it to Neopharmed Gentili for $250 million in cash upfront, and that helped us not only streamline our business, but pivot directly into a business development strategy where we turned around and got into the proposed acquisition of Astria Therapeutics that we expect to close in the next couple of weeks. And that gives us another late-stage rare disease HAE asset in Navenibart that we're really excited about.

We also achieved profitability for the first time in BioCryst history. And now that we've done that, we don't intend to go back. We expect to be profitable from here on out. And then finally, right at the end of the year in December, we got approval for ORLADEYO for kids, allowing us to bring oral preventative therapy for HAE kids down to as young as age 2, which we think will be transformative for the HAE community.

So a really big year for BioCryst. Preliminary results for the year, $601 million in ORLADEYO revenue, beating our latest guidance of $590 million to $600 million that we announced after Q3. And what's really important here for everyone to look at is the next line, $563 million in our ongoing business.

So this excludes the European business. So this is the baseline to measure our progress going forward, ended the year with great cash position, nearly $340 million. And that sets us up for 2026, where we are anticipating ORLADEYO revenue of $625 million to $645 million. Total revenue, once you include RAPIVAB of 635 to 660. And then on our base business prior to the Astria acquisition, because of the removal of our European business and other efficiencies, our base operating expenses on a non-GAAP basis will be $380 million to $390 million and then adding $70 million to $80 million once we closed the Austria deal to continue the operations there, completing the -- moving towards completion of the Navenibart clinical trial.

So a strong year for prescriptions, 1,600 patients on therapy in the U.S. despite the competition in the HAE space. So this sets us up to have 3 very strong pillars for our growth strategy. Starting with ORLADEYO, a commercial product that is on track for $1 billion at peak that we expect to hit in 2029. We're getting towards a greater than 80% contribution margin on that business. Once we add Navenibart, this is going to be north of 90% contribution margin on the commercialization. And then very importantly, a really long runway with ORLADEYO. We have composition of matter protection out to May of 2040.

So as we hit peak in 2029, we have over a decade of significant cash generation on that business. BioCryst in the past was all about our internal R&D, and we'll continue to do that in a very disciplined way with allocation of capital there. But we have some programs that we're really excited about, led by our Netherton syndrome program that I'll talk a little bit more about. This is a high need rare disease, and we have the potential to be the first truly transformative drug in a condition where there is no therapy for these patients right now.

And then external opportunities with all the cash generation from ORLADEYO, eventually from Navenibart, we will continue to look for late-stage rare disease assets, where we can plug that into our commercialization engine and really leverage the infrastructure that we built and the skills that we have in commercialization to drive future value in rare disease.

So again, this starts with ORLADEYO, a molecule that we developed ourselves was first approved in 2020 is now entering its sixth year of launch and still growing. As you can see from the right side of the slide, about 50% of the patients who have tried ORLADEYO in the U.S. are still on therapy after 5 years, and the growth continues. And the reason they're still on therapy is because ORLADEYO is a drug that either works fantastically well for you or it doesn't, in which case you move on. And we knew this going back to our Phase III pivotal trial, APeX-2, when we looked at the long-term 2-year data from this trial. And the patients who stayed on ORLADEYO 150 milligrams had a 91% reduction in attacks versus their baseline. And so in the real world, that's what physicians and patients are discovering is you should expect great efficacy from ORLADEYO. And if you don't get it, that's okay. You have many other options that you can try. And what this translates to is when a patient starts, patients start on ORLADEYO, 60% of them make it to a year. And then after a year because they're doing well, very few drop off therapy.

So ORLADEYO is not only the most differentiated product as the only oral prophylaxis product in the market. It's also highly competitive on an efficacy perspective. And so what this sets up for the next several years in ORLADEYO is we believe 15% roughly year-over-year CAGR in revenue growth out to 2029, where we expect to hit $1 billion. And if you look at the chart on the right, this is very achievable. All we need to do to get -- we've got 1,600 -- a little more than 1,600 patients today, at net average of 150 net patients per year over 4 years, gets us to where in the United States gets us to where we need to go.

A little bit of improvement in our paid rate going from 81% at the end of last year to 85%, and we continue to make progress year-over-year in this, modest price increases and then contribution from our businesses in Japan, Canada, and the rest of the world. This is a very achievable path to $1 billion. And then that sets up what we expect to be coming in a couple of weeks with the acquisition of Astria. We're really pleased with this deal. We were purchasing Astria for $700 million in total enterprise value. And it starts with the strategic fit. We have shown that we're really good at commercializing differentiated products in the HAE space. And this Navenibart fits right into that strategy, right into our core area of expertise. Navenibart is a very differentiated product. It has the potential to be in every 3 to 6-month injectable dose. And when patients and doctors hear about that 3 to 6-month profile, they get excited. This is something that makes them think about switching from existing injectable products. And it's very simple for them to understand because kallikrein inhibition is a mechanism that they already know well.

So you put these 2 things together in 1 team. As ORLADEYO hits peak, we won't need to spend as much marketing dollars in ORLADEYO. But it's the exact same team that we'll be commercializing. So we don't need more people to commercialize Navenibart. And so that just strengthens our cash flow position and sets up the opportunity to do more in the rare disease space.

So what's the opportunity for these 2 products, where you've got the only oral prophy product right now in ORLADEYO and then you're adding in a differentiated injectable product. What we see is that the U.S. HAE population on prophylaxis has been growing steadily at about 3% to 5% a year, and we expect that to continue as more patients are diagnosed. And as more patients continue to move over to prophylaxis.

So ORLADEYO has at least another 2 years where it is the only oral prophy product in the market. So we'll continue to grow with ORLADEYO. And then as I explained patients are already doing well on one pill once a day, why would they switch to anything else. Then from an injectable population, there's about 5,000 patients and growing who are on some type of injectable prophy and Navenibart comes in there with the most patient-friendly -- every 3- to 6-month dosing profile. And so the majority of the opportunity there is to switch patients from other prophy.

So 2 very complementary prophylaxis products that meet the needs of the market. And we're going to do this with a team that has great rare disease commercialization experience has been doing it in a very dedicated and differentiated way using a sole-source specialty pharmacy that allows us to generate evidence, evidence that we use to help our commercialization efforts on a day-to-day basis and then evidence that helps us build more into the clinical literature and teaches physicians, in this case, about ORLADEYO in the future about Navenibart and in the future about other products, perhaps like 17725.

So as I said, Navenibart is highly differentiated, early proof-of-concept data from Phase Ib shows that it's got a very competitive efficacy profile regardless of whether it's the 3 or the 6-month dosing. Very importantly, it's a small injection, 3 months will be a 2-milliliter injection every 6 months, we'll be double that in an auto injectors. And in the Phase Ib, no injection site pain, which is something that a lot of patients experience on the market leader today, lanadelumab. And so as I mentioned, you put these 2 together, we're addressing both segments of the market. There is a growing preference for oral prophylaxis and we're addressing that with ORLADEYO.

In fact, we're building that preference. But for those patients already doing well on an injectable, they're sometimes reluctance to switch to anything else unless the benefit is very clear to them. And that's where we think that Navenibart is going to step in and be very clear, you can go from every 2 weeks or every 4 weeks to every 3 months or every 6 months, and that's going to be the value proposition without giving up any efficacy.

So you put these 2 products together in 1 portfolio, and this is what it could look like. You've got ORLADEYO growing at mid-teens revenue CAGR through 2029. And hitting peak in 2029 is we do expect additional competition. But that's right when we'll have the first full year of Navenibart revenue kicking in. So $1 billion late this decade and then Navenibart keeps us growing at double digits, mid-double -- or mid-teens revenue into the 2030s.

And all of this is on a very steady base of operating expense. So we expect our OpEx over this time to grow at about 4% or 5%, mid-single digits. And what do you get for that? You get the team that's commercializing both of these products. Again, we don't need to grow it because we have the expertise. We have enough sales reps. We have the marketers. We have the marketing dollars. We just need to redeploy the focus between ORLADEYO and Navenibart. You get the G&A function that supports all of this. And you get the finance team, you get the HR team, pharmacovigilance, all of that is built into this. And then you also get our R&D. And so drugs like 17725, the cost of developing that and taking it forward is included in this chart. What is not included is the potential revenue from something like 17725. And so that becomes upside.

So we're going to be really disciplined on our operating expenses, growing revenue from HAE and beyond. And then it gives us the ability with -- we see $1 billion in cash in 2029 to redeploy and look for other late-stage assets that our team can commercialize.

So let's turn quickly to our pipeline. And the real thing to focus on here is BCX-17725 for Netherton syndrome. It's about to enter initial proof of concept trial in Netherton patients. We have other undisclosed targets that we're excited about, and we hope to bring forward in the future. But right now, let's focus on 17725.

Netherton syndrome is a really horrible disease. You can see from the picture of the kid on this page. It's a genetic disorder that causes uncontrolled skin turnover and not only does that obviously affect the skin, but for patients, this leads to increased infections, increase of atopic conditions, asthma, food allergies. What we hear from patients is patients with Netherton spend their whole day thinking about how they're going to deal with this disease.

And there are no approved therapies for this condition right now. We've done initial work showing that there are about 1,600 patients looking in claims data in the U.S. I'll tell you about some additional work that we're doing that suggests it could be even larger. So it's a classic rare disease, no treatments available right now. And our therapy is going to be replacing the missing protein and controlling KLK5 that is the uncontrolled bad actor in this case. And we have the potential to be the first targeted therapy in the first systemic targeted therapy.

So as I'm sure everyone is familiar in rare disease, you often see this where the prevalence, the incidence goes up once there are therapies and it makes sense because doctors don't tend to look for things that they can't treat. And we think -- we've seen this in HAE. We have people on our team who launched Cinryze back in the day, and they thought there were 2,000 or 3,000 HAE patients. Now we know there are over 10,000 in the U.S. And we think the same thing will happen in Nethertons. We're in the middle of doing -- we do a lot of really deep analytical work. That's a part of our commercial strategy and success. And we're doing that work in Nethertons, and we're using natural language processing models right now digging into EMR data, and it's suggesting that the population could be 3,000-plus in the U.S. alone for this high need disease.

So more to come on that, but we're excited about the opportunity. 17725 inhibits KLK5, which, again, because of the natural genetic defect the control of KLK5 is what's missing. That is at the top of a cascade of proteases and ultimately, cytokines that cause the skin to turnover, cause patients to have itch, cause redness and many other problems. We believe that inhibiting KLK5 really significantly, and that's what 17725 does can control this cascade and has the potential to restore normal skin turnover and all everything downstream from there.

So where are we in this program right now? We're through healthy volunteers. And our healthy volunteer work showed 2 important things. Number one, this drug appears to be safe in multi doses. So that's super important. And then number two, you can see from this slide, the drug is getting to the epidermis. That's where it needs to go. So you look at the right side here, we used a phosphorescence tag on the antibody. And you can see not only does 17725 flood the dermis, which is great, but it gets into that outer layer, which is the epidermis. That's where KLK5 acts. That's where the drug needs to be.

So this doesn't prove everything, but it was an important derisking of the program, and we'll see how the drug behaves in patients. So we're done with -- we've got a Phase I study that studied healthy volunteers and now it's moving into patients. We're finished with a healthy volunteers. We're moving into both Parts 3 and 4 of this Part 3 is expected to be 1 to 3 patients and it's a 1-month dosing period, 3 doses over 1 month. And then Part 4 is dosing for 3 months, every 2 weeks in up to a dozen patients. That's what you really want to focus on.

We are highly confident, by the end of this year, we will have up to about a dozen patients who have gone through 3 months with follow-up, and we'll be looking to see not only the safety and exposure. Is it getting to the skin, but importantly, is it changing the clinical picture? Is it improving skin turnover? Is itch going away for patients. And that's the information we're looking for to design our Phase III program, go to the regulators next year and begin a pivotal study for this high need disease.

So upcoming milestones, key milestones in about 2 weeks from today, we should be through the Astria acquisition. All that remains is a shareholder vote from the Astria shareholders. Then by the end of next year, and it could be sooner, depending on the size of effect that we see, 17725 proof-of-concept in Nethertons. And then early next year, Netherton's top line -- sorry, Navenibart topline result for HAE, which is obviously a critical stage towards moving towards filing and approval. This is on top of quarterly revenue growth in both ages 12 and up and the pediatric indication and more and more cash generation for the company.

So again, I'm excited for what we have going on at BioCryst right now. It's going to be a big year, and we have a lot of opportunity in front of us.

So with that, I will turn it over to Jess and...

Great. Thank you. And as a reminder, if you have a question in the room, just raise your hand. And if you have a question on the webcast, you can send me them on the iPad here.

So great, so we've had some competitive entrants in HAE prophylaxis recently. Can you just expand a little bit on how you've seen that landscape evolve over the past year and just kind of what you're seeing with the new entrants.

Sure. Yes, HAE for a rare disease is very competitive. I think there's 10 or 11 products approved right now, which is fantastic for patients. The most recent approvals have been an oral acute therapy and then 2 injectable prophy therapies. And so as I was describing, we have the most differentiated prophy therapy as the only oral prophy on the market. And for many patients, that's what they're looking for. And so that's a segment that we really own.

Overall, the market keeps going more and more towards preventing attacks with prophylaxis, which is the right thing to do. So it's probably around 80% of patients in the U.S. are on prophylaxis, and we see that continuing to grow. And then having the opportunity to treat the occasional breakthrough attack with an oral acute therapy is a great opportunity for patients. So we see that as a potential benefit for patients if they can be on ORLADEYO plus an oral acute is great. But the oral -- or sorry, the injectable prophy products moving from every 2 weeks to once a month is a nice to have for patients, but it's not changing the trajectory for ORLADEYO because of our differentiation. So we've seen all through 2025, even as new -- new products came on, continued strong demand for ORLADEYO.

And with the European ORLADEYO rights divested, can you also just talk through in a little more detail how ORLADEYO still gets to $1 billion peak sales without that region. So like how much of that growth is coming from market expansion versus market share?

Sure. The -- several years ago, we saw -- we announced that we saw ORLADEYO getting to $1 billion. That was with a 12 and up indication. As Jeff was suggesting, that also included our European business. So when we sold off our European business, we looked at our current U.S. business.

We also looked at the upcoming opportunity in treating kids down to age 2. And based on the pace of growth in the U.S. the addition of the pediatric population, which is both underdiagnosed and undertreated from a prophy standpoint and then modest growth from other regions. We see ourselves still getting to $1 billion because of that product differentiation, capsules for 12 and up, oral pellets for kids in a market where they only have injectable opportunities right now.

You put all that together. So we'll get most of that $1 billion in the U.S. and then contributions from Japan, Canada and other regions.

Yes, the question was about Avoralstat, which is I didn't mention this, but it's on our pipeline slide, which is Avoralstat is being developed for diabetic macular edema. We're in the middle of a Phase I proof-of-concept study in DME patients. And we decided in the second half of last year, to finish this Phase I study, but that this is not a rare disease.

So this is not core to our strategy. So what we're going to do is finish that program, and we're going to be looking for partners to spin it out to out-license it. We think that having a kallikrein inhibitor dosed via suprachoroidal injection. So at the back of the eye has the potential to be there for many months to inhibit kallikrein is a great opportunity for patients. But we're going to finish that Phase I, see what we have. We're making good progress on it and then see if we can out-license that this year.

So for the ORLADEYO business, you talked about by 2029 when you reach a steady state, the franchise just might not require the same level of resourcing. So how should investors think about the SG&A associated with ORLADEYO as it matures? And how should we think about kind of terminal operating margins with that franchise?

Sure. Maybe I'll start and then Babar can add some comments to that, which is we have a small sales force. We have 40 rare disease specialists covering the market. And we think they cover the HAE space better than any other team. They are super excited about launching Navenibart, and they can do ORLADEYO and Navenibart at the same time.

As ORLADEYO reaches peak the market is going to be very familiar with it. We don't need to spend as much promoting that. And so maybe that takes a second position to Navenibart. We devote more of our efforts to Navenibart our marketing dollars to Navenibart.

So basically, same pool of money, same great team just shifting the priorities around, so very similar OpEx.

Babar, is there anything you want to add?

Yes. And I think we disclosed this in our quarterly reports that at this point in time, we are not spending more dollars to buy revenues. The only expansion that you see in our S&M expenses primarily, let's say, you're selling more, you're going to pay the specialty pharmacy fees more.

So at this point in time, I think the expense structure for the base business is steady state. But even further, I think the overall business is reaching a point of equilibrium in the sense that as programs advance or basically, we are also very disciplined in terms of cutting programs that do not make the mark. We expect that the R&D expenses to remain fairly standard and going forward as well.

And then I guess just bigger picture, you've laid out like very detailed long-term projections. What's the rationale behind kind of like why you're providing such kind of specific long-term guidance for folks?

We -- we have -- let me start with the revenue and then we can talk about the OpEx, too. So we have launch to date, a big part of our success has been our ability to do deep market research and really predict what patients and doctors want. And we do very detailed models that predicts the future in this space. It's been very predictive of where ORLADEYO has gone launched to date.

Basically, 5, 6 years ago, we predicted where we are -- where we were in 2025. We're doing the same thing for Navenibart. So we want to help investors see what we see from that standpoint. And then from the operating expense, we really want to show how disciplined we are around our capital allocation right now and how we're balancing between those 3 priorities of driving the commercial growth, devoting what we should devote but not going overboard on the internal R&D and then allowing for cash generation for business development as the opportunities come up.

So then maybe related to kind of the R&D outlook, if the Navenibart Phase III is going to be kind of ongoing in '26 and wrapping up the data in '27. What's the right way to think about kind of the near medium-term R&D trajectory?

You want to handle that one, Babar?

Yes. So I think on the Navenibart side, there is going to be an incredible amount of synergies from the Astria acquisition since we are not going to have the G&A overhead. So we are guiding to this morning that upon closing of the transaction, we'll have about $70 million to $80 million of additional burn. But that will essentially go down because that trial is in its Phase III enrollment.

So we are preparing for -- we're doing the enrollment, we're preparing for pivotal CMC activities. So going forward, that expense will come down. But naturally, if 17725 is successful, then essentially, we'll see some pivotal trial. But having said that, and this goes back to the point in terms of strategy, any rare disease trial that you're looking at, you're not looking at several hundred million dollars of expense. So year-on-year, you'll see some expenses go up. Others go down as trials complete, but we're not looking at several hundred million dollars of R&D expense by nature of our business in terms of focus on rare diseases.

So you talked about the [indiscernible] trial, and I think you talked about Part 4 data by the end of '26. What about Part 3? Do we get that kind of in between there?

So I'll start on that and then Bill can add some color. Both Part II and Part 4 are open label. Part 3 is only 3 doses over a month. Part 4 is 6 doses over 3 months and then follow up. And the other key thing here is that Part 3 is not a gate to part for. It's really about when the sites are -- have the IRBs approved to go into Part 4. And so some patients will go straight into Part 4, and we may just have a couple of patients in Part 3.

So what we're looking for is when the outcomes in patients are really significant. When we see clear signs of clinical improvement that allow us to declare that we have a drug that can move on to a Phase III pivotal trial.

Bill, anything else to add?

Sure. What matters for us is seeing a big treatment effect in enough patients to give us the confidence to invest in a pivotal study. So 12 weeks of opportunity of dosing and with follow-up gives us more of an opportunity to see that. We're measuring, as you would expect, symptoms of pain, itch, redness, well-being, general health and if the drug gets into the skin in sufficient quantity, I'm confident it will work.

We've got the right target. So a very exciting program. I can't wait to see the data. But you should focus on having sufficient numbers of patients through 12 weeks of dosing to give a realistic estimate of treatment effect size.

And the one thing I'd add is we're seeing a lot of enthusiasm from -- there are not that many KOLs yet who focus on this disease, but the global KOLs, the U.S., Europe, Australia who see this disease are very enthusiastic about this, the profile of this product and helping us complete this trial.

And you talked about a big treatment effect and then you kind of outlined a number of clinical metrics. So have we moved beyond looking at biomarkers and now that we're in patients?

This disease pathology is all -- is starting the epidermis. So there isn't really a plasma biomarker of use for estimating pharmacodynamic effect like there would be in a disease like HAE, where you could use kallikrein inhibition as a tool. So this area lacks that. So we really have to focus on clinical outcomes. So it's all about the clinical outcomes here.

And then is the idea that you would go straight into some kind of pivotal study? Or is there kind of like a Phase II step in between?

The ideal progression here is to see dramatic improvement in the skin and go straight into a pivotal. And given that there are no approved therapies, we're anticipating regulatory engagement, both with the FDA and with international regulators to enable that to happen once we have the data from this study.

Can you give us a bit of a framework maybe some epidemiology stats on just how to think about the opportunity in Netherton syndrome?

Sure, there's first caution, I would say is don't just look at the literature because like any really rare disease at this stage in the game, you look at the literature, you'll see numbers of case reports. And so what we've been doing is going deeper than that. There's no ICD-10 code for this disease.

So we've done some work in a year or so ago looking at mentions of bamboo hair in claims data. Bamboo hair is a feature that kind of is what it sounds like. You look at hair, particularly under a microscope. It looks like bamboo that is distinct to Netherton patients. And we found about 1,600 U.S. patients with mentions of bamboo hair.

But we weren't satisfied with just that. So we're going deeper. As I mentioned, we're looking at EMR. We're using NLM technology to look at EMR data, to look at other features of the disease, other diagnosis patterns. And we think that this is now likely a 3,000-patient plus market. At some point in the future, there'll probably be an ICD-10 code. But right now, it's really critical for us to do everything we can to determine the size, understand the size of this market, and we think it's a lot bigger than what you'll see in the literature.

And it sounds like highly symptomatic. So is this like a difficult diagnosis? Or are these patients -- I would think they would become well identified. How do we kind of reconcile that with the idea that they may be underdiagnosed.

The simple story is what I said earlier, which is doctors don't look for things that they can't solve. And there's no diagnosis code, so they can't peg it there. Netherton syndrome is particularly acute and life-threatening for kids, for infants because at young ages, children's skin turns over a lot faster.

Kids are growing and maintaining a skin barriers even that much more important. So it can lead to more diagnosis there, but some of these kids are missed. Then as patients get older, it becomes more of the chronic stage, which is still a really difficult disease. But as I mentioned, patients spend their whole day operating around this disease. They typically apply creams, over-the-counter creams across their whole body multiple times a day. They have other special things that they learn to deal with. But what we hear from patients is because their doctors have nothing to offer them, they get frustrated, and they stop going to ask anymore.

So they kind of disappear into the woodwork of the health care system. And we think that having a targeted therapy is going to help them come back out. And we've seen this. We heard the story in HAE, where patients would get misdiagnosed. They kind of bumble along on their own for the years, but now that there's therapy. They're with good doctors who know what they're doing, and it's completely changed in the last 15, 20 years.

So coming back around to Avoralstat for DME, now that that's kind of in the bucket of kind of potential licensing opportunity, should we expect to hear about the initial data or only kind of when that deal materializes?

Most likely when a deal materializes. Let me tell you where we are right now. We've got -- in the Phase I study, we've got 3 cohorts. We've completed the first cohort at a 100-microgram dose. That was by design, is really a safety dose. So we do not expect to see much efficacy from that.

The next cohort goes to 250 micrograms and the third cohort goes to 500 micrograms. We just opened the IND in the U.S. So we're starting to enroll U.S. studies. Previously, it was just in Australia. And so we're confident that towards the middle of this year, we'll have a lot more data there. But you're likely to see the data more when we announce a deal.

Great. So we're about out of time, so we'll leave it there. Thank you.

Great. Thanks, Jess.

Hi, everyone. My name is Maury Raycroft, and I'm one of the biotech analysts at Jefferies. It's with great pleasure that I'd like to welcome the BioCryst's management team. We've got Jon Stonehouse, CEO; Charles Gayer, Chief Commercial Officer; and Babar Ghias, the CFO. Thanks so much for joining us today.

Yes. Thanks for having us.

And we're going to do a fireside chat format. So for those who are new to the story, if you can give a brief intro to BioCryst.

Sure. So Maury, first off, thanks for inviting us to this year's conference. We're all going to be making forward-looking statements. Those statements have risks. Risk factors can be found in our most recent filings.

BioCryst is a pretty interesting company. I've been in it for almost 19 years. And today, BioCryst is a company with revenue from ORLADEYO, somewhere between $590 million and $600 million and growing to a peak of $1 billion. So really good trajectory of growth and patent protection out to 2040. So that's the growth engine.

Next is we've got a pipeline of internal stuff, the one that's in the clinic -- 2 in the clinic, [ 17725 ] for Netherton and then avoralstat for DME.

And then third, we're in a financial situation where we were able to do a proposed acquisition with Astria, and that's in the process of going through the closing process. And so now we have a late-stage asset with navenibart and in a spot where we know the space very well with HAE. And so we're really excited.

So -- and we'll continue to be profitable. This is our first year of profitability, a year ahead of schedule when we first said we would move towards profitability, and we'll continue that even with the absorption of Astria. So really exciting story.

Got it. Yes, it's a great intro. And I wanted to ask about ORLADEYO. It's pretty soon since you just had your earnings, but maybe you can comment on how fourth quarter sales are looking and how you're setting expectations for the quarter and drivers that could lead to beat or surprise?

Yes, Maury, maybe I'll reiterate something that we said at the Q3 earnings call, which is in the third quarter, we had -- despite the launch of 3 new competitors in the space over the summer, we actually had slightly more new patient starts this year than we did in Q3 of last year.

So this is what we expected because ORLADEYO is the most differentiated drug, it's the only oral drug in the market. And what the prescribers and patients are showing is the demand is still there in our fifth year of launch. And so we expect that same consistent demand and consistent patient retention. And we'll -- so we'll have continued steady growth throughout the fourth quarter, getting to what Jon said, $590 million to $600 million for the year.

Got it. Okay. And maybe just talk about the EU divestiture and just the rationale and the impact there as well.

Yes. The rationale is we built a really strong EU business, but it was generally loss-making or breakeven. So we were generating about $50 million in 12-month -- trailing 12-month revenue, but the costs were also about $50 million. And our new partners, Neopharmed Gentili, came to us with a really attractive offer with about a 5x multiple on the revenue.

So for $250 million, they wanted to buy the product in Europe, but also very importantly, the team that could be the base of a new rare disease consolidator strategy for them. So it really fit, and then it allowed us to clean up our balance sheet and contributed directly into the proposed acquisition of Astria.

Got it. Okay. That makes sense. And I guess did you know about the Astria acquisition before the divestiture? I guess, was that...

No, the divestiture started last year at some point. The Astria thing was more recent. But what it allowed us to do, it gave us different levers such as retiring our existing debt, which we've done. So it just made our position stronger.

But the ability to be able to pull off that sale put us in the acquisitive mode for sure.

Right. Yes. Okay. Makes sense. And you're maintaining 2029 potential $1 billion peak sales guidance for ORLADEYO, which now includes pediatric sales and excludes EU sales. You mentioned that as the [ prophy ] market continues to evolve that you're maintaining steady growth there with commercials. But just how do you see the drivers behind that $1 billion peak sales changing over time or staying the same over time?

Yes. We -- it was a few years ago that we first said that we saw ORLADEYO as reaching $1 billion. And at the time, we said that would be $800 million from U.S. revenues for the capsules, the age 12 and up indication and then $200 million ex U.S., with about half of that being Europe, half being everywhere else.

So even with taking out the $100 million from Europe, as you said, the reason we think we're still at $1 billion in 2029 is the U.S. business has grown more strongly than we anticipated when we set $1 billion a few years ago. And then we're adding in the pediatric indication, the -- what we hope to be aged 2 to under 12, with a PDUFA date on December 12, so right around the corner. And the combination of those two things puts us on a path to $1 billion in 2029.

Got it. Okay. And kind of another question just around the evolving HAE landscape. Just, I guess, what are the key leading indicators that you're tracking to give you confidence around the continued cadence of new patients going on to drug?

We do a lot of market research. That's been one of the keys to our success in the launch so far because we really want to understand what the future looks like and what we've done has been very predictive of where we've gone.

So what we see again is with ORLADEYO being the only oral on the market right now, the only oral prophy on the market, the forward-looking intent to prescribe from physicians is just as strong as it's ever been. The desire from patients to be on an oral therapy has actually increased over the last few years.

And so there's still a lot of opportunity. At this point, a little over 3,000 U.S. patients have tried ORLADEYO. But that means that there's up to 8,000 left who have not. So there's a lot of opportunity in front of us.

Yes. And I think a really important point for investors to understand is one, the market has changed dramatically in the last decade or so where everybody is controlled now, right? Everybody -- most -- as Charlie has said in the past, 80% of the market is prophy. Most people are on prophylactic therapy, and they're under control.

So they only see their doctor maybe once or twice a year. And so the frequency that they get back is very limited. And so that affects the trajectory of growth of any new entrant. That's point number one.

Point number two is ORLADEYO really works in the patients that -- as well as an injectable therapy when it works. And so people aren't sacrificing efficacy or willing to not be controlled because they get to take a capsule a day, they'll go on to something else. They'll go back to what they were on before or they'll go on to something else.

And so with that, if you don't have something that works as well as ORLADEYO in these patients that's better than a 1 pill once a day, why on God's earth would you switch? And that is the fundamental premise of why the market share is so sticky.

Yes. Makes sense. Okay. And for those 8,000 patients that haven't tried ORLADEYO, I guess, what's the strategy there to eventually get to those patients?

The main strategy -- well, two things. One, we -- our team has been excellent at reaching prescribers. So we're constantly expanding our prescriber base. We had 63 new prescribers in the third quarter. And the way I like to say it is if it looks like you might have an HAE patient, we will find you. So it's getting -- it's going beyond the KOLs and getting into allergist immunologists mainly who might not even realize that they have an HAE patient. And so we're really good at finding that.

And then the other piece is we continue to generate more evidence in the real world on ORLADEYO. And so what this does is it builds the story around the efficacy.

So for example, earlier this year, we released data in over 350 patients with HAE with normal C1 inhibitor. And nobody has ever released this kind of data before, and it opened up or further strengthened a segment that's now about 30% of the patients on ORLADEYO and giving prescribers, patients and importantly, payers more confidence in ORLADEYO that it should be used and it should be reimbursed for those patients with normal C1 inhibitor.

Got it. Okay. Yes. All helpful. And let's shift gears to the Astria acquisition. Maybe just checking if there's any update on the closing of the deal, if you've gotten FTC clearance, any update there?

Everything is on track. So for Q1 closing, and you'll see updates in the coming weeks in terms of proxy statements and all that, but it's on track for Q1.

Got it. Okay. And maybe talk a little bit about the reason why you're doing this acquisition and bringing in this injectable into an HAE franchise that's been focused on an oral prophy. And so yes, maybe just kind of talk about the purpose of it.

Well, Jon talked upfront about our financial position and our ability to now expand our portfolio. Right now, we have one product on the market. So the question is always what's next. And what's next we said needed to be something that is later stage, it needs to be something that has very low risk and make really clear strategic sense. And I think with Astria and Navenibart, we really nail all three of those points.

Astria is a company we've been following with great interest. We actually started talking to them a few years ago because when we first saw what they had and some of their early data, we thought this is going to work.

And then when we talked to physicians, do research with physicians and patients, they see the profile of every 3 or every 6-month kallikrein inhibitor. And what comes out of their mouth is, "Oh, yes, this looks like TAKHZYRO," the market leader, "but I can do it every 3 to 6 months and without injection site pain."

So it's going to be a very differentiated product. And so we think it complements what we already have in the oral space with ORLADEYO.

Got it. And what's the roadmap to capture the approximate 5,000-plus injectable experience patients with Navenibart? And what parts of the launch strategy will be similar or different versus your ORLADEYO launch? And which type of patients are you going to target?

One of the things that's going to be very different is that we're going to be able to launch Navenibart with basically a running start because we've got our commercial model built, we've got our team in the field, the relationships are there.

I'll give another example, which is by the time Navenibart launches, we'll probably have about 3,000 U.S. patients who've tried ORLADEYO, turned out not to be the drug for them, but we have approval, we have permission to market to them. And so we're building a base of potential future customers for Navenibart. Most of these patients now have moved on. They're on TAKHZYRO or ANDEMBRY or another injectable product.

But back to my point of they -- when they see this profile of Navenibart, this is something that we think is really going to motivate switch. And so we know the customers. We've got the data. We've got levers to pull on the marketing front and the sales front. And so it gives us opportunities that we had to build with ORLADEYO, we're going to have that right from the start.

Yes. And I think one other thing is there's no "winner take all" in this market. And so there'll still be over 5,000 patients on injectable prophy therapy, which in the turn of the decade, which is a huge opportunity for Navenibart. And we kind of get to the plateau of ORLADEYO. So we'll continue to have that beautiful revenue growth of approximately 15% compound annual revenue growth into the next decade.

Got it. And which types of patients are going to target initially, this launch?

I think the biggest opportunity is those patients who will be on TAKHZYRO. It's the market leader today, we actually think it will be -- it's a really good drug, and patients are going to stick with it, many of them. But the ability to have a drug that they can very clearly understand, but offers them something better for them in terms of the dosing while still being very high efficacy makes that a really important target segment.

Great. And just thinking about allocating resources internally, how do you make those decisions on what you want to allocate towards ORLADEYO versus Navenibart so there's no conflict and you can maximize value?

Well, first of all, it's a near-perfect synergy from a cost perspective because we don't need more salespeople, we don't need significantly more marketing dollars. So if you think about it, in 2029, as Jon said, ORLADEYO is going to be reaching a peak. There are going to be over 2,000 patients who are doing really well on one pill once a day, and they're likely to stick with it.

We may not be attracting as many new patients at that point, but we won't need as many resources to maintain the business that we have. So the sales force, while they're now 100% focused on ORLADEYO, maybe in the future, it's 80% on Navenibart and 20% maintaining on ORLADEYO. It's all the same customer base. So it's -- we're really enthusiastic about it.

Got it. And for the Navenibart clinical development plan, is there anything that you would do differently with that? Is there a way that you can potentially accelerate it?

I mean we've been really impressed with the Astria team and what they've done so far and the -- where they should be, they've guided to Q1 of 2027 for top line pivotal data.

What we'll do, first of all, is once the acquisition closes; is do no harm to that. So we want to make sure that we continue to do the great things that they're doing. But then we have a very experienced team as well, who's done this before with ORLADEYO. So we will try to -- anything we can do to help without getting in the way will be part of our strategy.

The synergy story here is that you don't have to build a new sales force and all the supporting G&A to launch Navenibart, which is what Astria would have had to do on their own. So that's -- we have that. So that -- I mean, that is massively synergistic.

Yes. Makes sense. And for that Phase III study, so they're testing Q3 and Q6 dosing. Do they have to hit [indiscernible] on both? How do you view that just the benefits of every 3 months or every 6 months?

Yes, they would -- first of all, we have a lot of confidence that both doses will hit statistical significance, not relative to each other, but versus placebo. That's what you need to get into the label. So we have high confidence that it will be a product with the option of 3- and 6-month dosing. And that flexibility to have one or the other is what patients and doctors want.

Right. Okay. And anything more you could say on just expected timing for the regulatory path to get the drug approved?

I mean I'll just say again, what Astria has said is data -- top line data Q1 of 2027. And then if you look at the analogs from ORLADEYO, other prophy products that have been approved in the last several years, it's usually 18 to 24 months from top line data to launch, depending on how a company puts together the package. We'll look to do that as quickly as possible. So launch in the latter part of 2028.

Got it. Okay. And then with the EU divestiture, now you're going to have a new drug that could potentially have value potential in the EU. So what are your plans there?

Well, we built a great team. They were super successful. We will not build again in Europe. So we would look to partner it. And that's another thing as we acquire the company and the program, it could be another thing where we out-license that. There'll be a lot of interested partner opportunities in Europe.

Got it. And how do you view evolving competition as it relates to this asset?

So we view this one as the really differentiated injectable product. I'll go back to that point of customers describing this as it's like TAKHZYRO but longer acting. So it's really easy for patients and doctors to understand what Navenibart is.

There are some other drugs coming in the future that could be very effective drugs, but may not be as easy for doctors to explain to their patients. And so we think that both the timing of the Navenibart launch, the fact that our team will be doing it and our skill in HAE and then the fact that the story is very easy for customers to understand and very meaningful really sets Navenibart potentially apart from anything else that's coming in the future.

Did you guys do a lot of market research on just how many patients would switch from TAKHZYRO to Navenibart and...

Yes. We definitely do a lot of market -- I mean we do. And again, I'll say they see this as a very attractive product. It's hard to get HAE patients to switch because it's really got to be a meaningful thing to them that "If I switch, what do I get? Am I confident that this drug is going to work as well for me? And then what's going to be the burden? What is going to be my support?"

And I think the HAE community has seen that the BioCryst patient support program is second to none. They -- we expect this to be a very highly effective drug. And then like I said, it's easy for them to understand. So I think it checks all the boxes.

Got it. Anything else you could say on just what you would do to get those patients to switch from TAKHZYRO?

Why don't we save that conversation for -- meeting in a couple of years? But look, we've got a lot of tools, and it all starts with the product profile and then the skill and experience of our team.

Maury, I would argue who's done a better job of switching patients from TAKHZYRO than BioCryst, right, at least to this point. So I have a high degree of confidence that they'll be successful.

Got it. Okay. I want to talk briefly about your pediatric opportunity. You've got PDUFA coming up December 12. Can you say if you're in labeling discussions? And maybe comment on how pricing is going to work for this.

Yes. We're in normal discussions that you would have with the FDA at this stage. So we think everything is on track. You can't say anything to 100% until you get there, but we're in the normal discussions at this point.

And then what we expect to have is 4 different granule presentations, weight-based for kids and that the pricing will be equivalent to capsules. So each of the granules will be in individual sachets, daily sachets, and the pricing will be equivalent to the capsules.

Got it. And anything more you can comment on just how you expect the label to look and just the ramp-up in the setting?

I mean the label will look pretty -- we would expect to be pretty simple, which is age, HAE, what are the doses for what weight bands. There's not going to be a whole lot of additional -- the study was relatively small, 29 patients, open label. So it's not going to include efficacy data or a lot of differentiating safety data in the label.

What I can tell you is of those 29 patients, the retention in the trial, 93% of them made it to 12 months on the trial. And then 83% of them are still on the therapy. And so really good reduction in attacks and a very clean adverse event profile for the kids on the granules.

Got it. Okay. So let's talk about Netherton. So you've got data update first quarter of next year. How are you setting expectations for that? And how would you define success?

So the big thing for next year with Netherton it's a really -- it's a rare but really nasty skin disease cause is overactive skin turnover based on a missing regulatory protein. And by the end of Q1, we expect to have a small handful, maybe a couple of patients of data who have dosed 3. It's going to be an every 2-week injection.

What I think is going to be most interesting is by later in the year, we'll have about a dozen patients who have dosed for 3 months, so 6 doses over 3 months. So depending on the size of the effect, the long-term goal is to restore normal skin turnover.

Will 1 month of dosing be enough to show that? We don't know. But we think you would see that in the 3-month dosing a little bit later in the year. What we're excited about is we've showed in healthy volunteers that the drug gets to the epidermis. And so that was kind of a critical derisker because that's where the KLK5 is that needs to be inhibited. And so we would expect the drug to get to the skin of patients equally well.

Got it. And just to clarify, so the data later next year, would that be from Part 4 or Part 3?

That would be Part 4. And in fact, we don't have to wait for any Part 3 data to go into Part 4. So as soon as we can get patients starting to enroll and sites are getting up and running, the investigators are getting very excited about this. We'll really put our focus on Part 4, but we're likely to have data on a small number of patients at the end of Q1.

When would you know when you want to meet with FDA to discuss pivotal and...

Probably after Part 4 data. I mean the data in Part 4, there'll be some dose ranging within that and depending on the size of effect, will allow us to design the proposed clinical study and have good discussions with the FDA and other regulators. So it could be the kind of thing that sets us up to start a pivotal study in 2027.

Got it. And maybe briefly just talk about the market opportunity here for now.

Yes, the market opportunity, huge unmet need. No treatment on the market today for these patients. So we've identified 1,600 patients in health care claims data. But what we know from the experience of diseases like HAE, once you have therapies on the market, these rare diseases tend to grow.

So when CINRYZE was launched, the ViroPharma team thought that there were maybe 2,000 or 3,000 patients with HAE in the U.S. Now there are 11,000. And so that 1,600 number is likely to grow. We're doing more work to figure out how big we think that might be, but it's probably going to be a multiple of 1,600.

Got it. Okay. So a decent-sized rare disease opportunity. And for DME, maybe just provide a quick status update on that one. And is that update going to be in a press release or...

The main update for DME that we announced at the end of our Q3 earnings is once we finish the first 9 patients, so it's 3 ascending -- single ascending dose cohorts with that; our plan is to spin that out, license it out.

It's -- obviously, it's not a rare disease, and we'd like to find a partner who is willing to pay for those ongoing studies and that maybe we can share in the upside longer term. But we're not going to pursue that past those first 9 patients. We'll have initial data in the first quarter of next year on the initial cohort of patients.

Got it. Okay. So we're out of time. Maybe, Babar, do you want to just comment on just the potential BD activity that you can implement and just how to think about expenses going forward as well?

Yes. I'll address the expenses first. As you are aware that at the recent earnings release, we sharpened our expense guidance. We lowered guidance from $440 million to $450 million to $430 million to $440 million. We're seeing a little bit of improvement in how we're running our businesses.

The European divestiture gives us an immense opportunity to clean that operating structure further. So when we come out in January and provide you guidance as a stand-alone business because Astria would not have closed, you will see that the ORLADEYO still continues to grow at a double-digit clip and expenses will be significantly reduced. So our operating profitability and margins will be significantly better.

Now Astria is expected, as Charlie mentioned, to close in -- somewhere in Q1 of 2026, and we'll integrate the business, and we'll be ready to share their burn rate and what that additional burn rate that we will encumber somewhere at the end of Q1. But having said that, we are anticipating that we still be profitable. We'll continue our profitability. We'll continue to be cash flow positive.

But really, as Charlie mentioned, that we are at steady-state cost structure. So going forward, looking at 2027 and beyond, our operating expenses will actually come down because most of the Astria clinical trial will be done, and we're not rebuilding a commercial team to launch. So the ORLADEYO continues to grow, and expenses are steady state, growing at a very sort of low clip. So 2027, 2028 and beyond, operating profitability is going to be significantly higher.

And then naturally, with the anticipated approval of Navenibart in 2029, that's all synergies basically. It's the top line and then gross profit that falls directly to the bottom line.

So that comes to the next logical question about BD. I think we have some really important catalysts in Netherton syndrome next year. But we will continue to look at new opportunities. I think not every opportunity we look at has to be a blockbuster potential. With the infrastructure that we have, we could have a peak opportunity of $300 million to $400 million top line and can still deliver a lot of bottom line benefit. So we'll be very capital disciplined in terms of how we go about doing BD from this point onwards.

But rare and high probability of success in later stage.

Yes. Our internal R&D engine is really good at sort of the early stage part, and we'll supplement it with more later stage. So it will be -- we hope that the new BioCryst will be a very emerging product story over the next years to come.

Got it. Thanks so much for joining us today.

Thanks for having us.

Good day, and welcome to BioCryst Third Quarter 2025 Earnings Conference Call. [Operator Instructions] Please note this event is being recorded.

I would now like to turn the conference over to Nick Wilder. Please go ahead.

Good morning, and welcome to BioCryst's Third Quarter 2025 Corporate Update and Financial Results Conference Call. Participating with me today are CEO, Jon Stonehouse; President and Chief Commercial Officer, Charlie Gayer; Chief Development Officer, Dr. Bill Sheridan; and Chief Financial Officer, Babar Ghias.

A press release and slide presentation about today's news are available on our Investor Relations website. Today's call may contain forward-looking statements, including statements regarding future financial results, unaudited and forward-looking financial information as well as the company's future performance and/or achievements. These statements are subject to known and unknown risks and uncertainties, which may cause our actual results, performance or achievements to be materially different from any future results or performance expressed or implied in this presentation. For additional information, including a detailed discussion of these risks, please refer to Slide 2 of the presentation.

In addition, today's conference call includes non-GAAP financial measures. For a reconciliation of these non-GAAP measures against the most directly comparable GAAP financial measure, please refer to the earnings press release.

I'd now like to turn the call over to Jon Stonehouse.

Thank you, Nick. We are very pleased to report yet another strong quarter for the year. Starting with ORLADEYO, we continue to see strong revenue growth year-over-year on a growing revenue base, well on our way to $1 billion at peak. Charlie will share the details as this was the first quarter with new competition, and we continue to see strong underlying growth and a growing prescriber base as we predicted.

Next, we closed the sale of our European business and paid off our Pharmakon debt. And this not only cleaned up our balance sheet, but put us in a very strong financial position, generating operating profit and positive cash flow. Babar will share more details regarding our financial position.

We are also making progress with our pipeline and expect early data that should give an initial view on activity and dose from our DME program, and we plan to share this early next year. If these data are encouraging, we have also made a decision that given the program is outside our rare disease area of focus, we will look to spin out or partner this program to put it in the hands of someone better suited to advance it further.

Regarding BCX17725, Bill will share encouraging data from our healthy volunteer study showing evidence that the drug does get to the skin following IV administration. This is important as this is where the target for Netherton syndrome is and with a very potent inhibitor in BCX17725, we are excited to see in Netherton syndrome patients what effect it has on the disease. Enrollment is taking a little bit longer than planned, and we now expect early data in a small number of Netherton syndrome patients later in Q1 next year.

Lastly, having announced the proposed acquisition of Astria last month and the expected close in Q1 next year, we are extremely excited to add a late-stage asset, navenibart, to our pipeline to leverage our expertise in HAE and bring patients a new treatment option with a low burden of administration. So clearly, we have been busy since last reporting quarterly earnings, and this is shaping up to be another outstanding year of performance for our company.

With that, I will turn it over to Charlie.

Thanks, Jon. We entered the final quarter of 2025 with continued momentum. We are raising our ORLADEYO revenue guidance to between $590 million and $600 million for the year, even after closing the sale of our European operations on October 1. And the exciting possibilities of the ORLADEYO granules launch for kids with HAE and the acquisition of Astria are just ahead. ORLADEYO continues to be the most differentiated prophylaxis therapy for patients with HAE. Most HAE patients would rather prevent their attacks with an oral therapy. Physicians know this, and they trust ORLADEYO.

Even as 2 new prophylaxis products launched recently, offering patients the potential of once monthly injectable dosing, new prescriptions for ORLADEYO continued at the same strong pace we have seen over the past 2 years. In fact, we slightly exceeded the new patient prescription total from the third quarter a year ago. We also continue to expand the number of ORLADEYO prescribers with 64 new prescribers in the U.S., exceeding the average of the past 8 quarters. The well-established trends in patient retention remained unchanged, and we ended the quarter with a paid patient rate of 82%, right in line with the typical second half pattern compared with the first half of the year.

As always, we're very pleased with the great results, but not surprised. Our deep insight and market simulation works consistently predicted that the growth of ORLADEYO would not be affected by new competition. We updated that work over the summer, and the 2025 results were nearly identical to the 2024 results, as you can see on Slide 8 in today's presentation. With the expected addition of ORLADEYO granules on top of the existing strong growth trends for ORLADEYO capsules, our market simulation continues to predict $1 billion in peak revenue for BioCryst in 2029, even after the sale of our European business.

The analysis demonstrates that new injectable therapies primarily compete with existing injectable therapies. This is why we are so enthusiastic about the prospect of adding navenibart to our portfolio. With navenibart, we could have the lowest burden, most differentiated injectable prophylactic therapy, along with a long-time leading oral therapy, significantly expanding our ability to help patients in the HAE community. We expect navenibart to drive double-digit HAE revenue growth well into the 2030s after ORLADEYO revenue reaches a steady plateau. And we expect to manage costs by using the same rare disease commercialization engine that has made ORLADEYO so successful.

Today, I'm also very pleased to announce that Ron Dullinger will succeed me as Chief Commercial Officer when I move to the CEO role on January 1. Ron led the sales team at ViroPharma during the early days of CINRYZE commercialization. While that drug changed the HAE treatment paradigm at the time, Ron always knew that an oral therapy was what many patients really wanted, and he wanted to be part of making that possible. Ron joined us in 2019 to build and lead the U.S. team -- U.S. sales team for the launch of ORLADEYO. And since 2022, he has served as General Manager of our U.S. and Americas business, fostering a team culture that is deeply caring and authentically focused on serving patients while also being relentlessly driven to improve. That's a rare combination, and it has produced amazing results. I look forward to what our commercial team will achieve under Ron's leadership.

As we look forward to helping a growing number of HAE patients, our excitement about the potential to help patients with Netherton syndrome is also growing.

I'll turn it over to Bill to describe our progress with BCX17725.

Thanks, Charlie. I'm very pleased to be able to share some findings from our ongoing Phase I study of BCX17725, our novel investigational KLK5 inhibitor designed to replace functions of the natural inhibitor that are deficient in individuals living with Netherton syndrome. This trial is designed with multiple goals in mind: number one, understanding the preliminary safety profile of BCX17725; number two, quantitating its systemic exposure with serum drug levels; number three, evaluating the distribution of the drug into the epidermis. This is very important because the target enzyme, KLK5 is expressed in that location. Number four, assessing its potential early treatment effects on signs and symptoms of Netherton syndrome. We are planning to first do this in a few individuals living with NS in Part 3 of the trial.

The trial has so far progressed through multiple cohorts in healthy volunteers with different cohorts administered single or multiple doses of study drug. This gives us a handle on the first 3 goals. The dose level of BCX17725 has been progressively increased with up to 12 milligrams per kilogram administered by IV infusion. In the multiple ascending dose portion, 3 doses were given on a Q2-week schedule. In this trial, administration of BCX17725 has been safe and well tolerated with no safety signals seen and preliminary assessment of systemic exposure profiles supports continued testing of up to every 2 weeks dosing regimens.

Some representative images from skin biopsies taken before and after dosing in healthy subjects are shown on the accompanying slide. These small punch biopsies are taken under local anesthetic and processed for imaging. The images shown use a technique called immunofluorescence microscopy. Antibodies are applied that specifically bind to the protein you want to detect, in this case, the drug, BCX17725. These complexes are then detected with secondary antibodies, covalently tagged with a fluorochrome, which is a chemical that fluorescence typically under ultraviolet or near ultraviolet light. That means we can see a specific color based on the fluorochrome used wherever the drug is located in the tissue specimen and the more drug there is, the brighter the signal.

We can also use other differently colored fluorochromes to pick out structures such as cell nuclei. Although minimally invasive, we are limited in the number of biopsies we can take. So we decided to obtain a baseline biopsy prior to the first dose as a control sample and a post-dose biopsy 5 hours after the last dose of drug. The displayed biopsy sample images from a representative healthy volunteer in the 12-milligram per kilogram multiple dose cohort show the DNA located in cell nuclei in blue and the drug located in the extracellular matrix in green. The pre-dose sample shows the loose dermis with widely spaced bright blue nuclei and the dense epidermis with tightly packed nuclei with a very faint green signal due to nonspecific binding of the assay reagents.

In the post-dose sample, there is an obvious difference with much brighter green fluorescence. You can use the blue nuclei as a benchmark. In the post-dose image, drug has flooded the loose connective tissue in the dermis and distributed throughout the epidermis. These are important findings. The drug was able to diffuse across the epidermal basement membrane into the extracellular matrix of all the layers of the epidermis. Drug getting to the epidermis will allow its access to the target enzyme KLK5 in patients with Netherton syndrome. Our investigators are quite excited by these results as are we, and we look forward to enrolling patients with NS into the trial in coming months.

I'd now like to turn the call to Babar to walk you through the financial progress.

Thanks, Will. My first full quarter as CFO of BioCryst was extremely eventful and was marked by several significant achievements, which I believe position us well for future growth and profitability. On October 1, we successfully closed the sale of our European business, providing an immediate boost to our financial position, enabling us to fully repay our Pharmakon debt.

During Q3, we worked diligently on a highly strategic and transformative acquisition of Astria Therapeutics, which we announced last month, an acquisition which is expected to strengthen our presence in HAE and solidify double-digit growth trajectory for our portfolio over the next decade. As part of this proposed transaction, we also worked on securing a strategic financing partnership with Blackstone at a highly attractive cost of capital. Upon closing of the Astria acquisition, which is expected in Q1 2026, we will access up to $400 million of cash from this facility.

But all of this was only made possible due to the continued strength of ORLADEYO and our improving operating performance. Please refer to our third quarter financials in today's press release. However, I would like to take a moment to elaborate on some of these accomplishments and their impact on our trajectory.

Total ORLADEYO revenue was $159.1 million, representing 37% year-over-year growth. Of that ORLADEYO revenue, $141.6 million or 89% came from the U.S. As you heard in Charlie's remarks, we continue to see strong momentum in our business despite the recently announced approvals. Non-GAAP operating expenses, excluding stock-based comp and transaction-related costs were approximately $108 million (sic) [ $118 million ] for the third quarter of 2025, up from approximately $92 million in the third quarter of 2024.

Some of this increase was driven by continued investment in R&D, which continues to be a priority for us. As you heard from Bill, we are very excited about the promise of these programs. We have also made a strategic decision to seek partners for our DME program after we evaluate initial patient data, in light of sharpening our focus on rare diseases and focusing our capital allocation on programs where we can create most value.

Non-GAAP operating profit, excluding stock-based compensation expense and transaction-related costs was $51.7 million for the third quarter of 2025 an increase of 107% year-over-year as we continue to benefit from significant operating leverage. Our non-GAAP net income for the quarter was $35.6 million, resulting in non-GAAP EPS of $0.17 per share. We finished the quarter strong with $269 million in cash, which included cash held for sale by European entities. Our strong cash flow profile enabled us to make a $50 million prepayment on our Pharmakon term loan during Q3. And with the closing of the sale of European business, we also paid off the outstanding amount under the term loan of approximately $200 million.

Our pro forma cash balance giving effect to these adjustments is approximately $294 million and 0 term debt. Due to the strong expected cash flow generation, we anticipate reaching $1 billion in cash during 2029. However, we will continue to evaluate various capital allocation opportunities to generate value for our stockholders, much like our recently announced proposed acquisition of Astria Therapeutics. We will also explore upon closing of the transaction, a European license of navenibart and strategic opportunities for the STAR-0310 program, which may yield further upsides.

Moving on to guidance. Charlie already alluded to the revenue guidance, and at the same time, we are lowering our non-GAAP OpEx guidance to $430 million to $440 million from our original guidance of $440 million to $450 million. The European divestiture allows us the opportunity to continue to streamline our base business cost structure. We remain on track to deliver non-GAAP net income and positive cash flows for full year 2025. As previously stated in our acquisition press release, we are expecting to stay profitable on a non-GAAP basis as well as cash flow positive even during the development period of navenibart.

In closing, I'm proud of our team's continued focus and execution as we work to drive sustainable growth and deliver meaningful improvements in patients' lives. Our strong results and disciplined operational and financial strategies position us to capitalize on future growth opportunities, strengthen our leadership in rare diseases and continue delivering value for our stockholders.

Operator, we are now ready for your questions.

[Operator Instructions] First question comes from Jessica Fye with JPMorgan.

This is Jose for Jessica. Of the 37% year-over-year ORLADEYO net revenue growth, how much of that was volume? And how much of that was better paid rate or net price? And on that front, how should we think about gross to net this quarter and going into 2026? And very quickly, how confident are you that you can maintain steady patient retention rates given the increasingly competitive landscape?

I can start with that question. So of the 37% year-over-year, we had really steady -- we've had very steady volume growth over time, but there was a big portion of it that was price based on the improvement in paid rate that we described earlier this year, particularly in the Medicare segment. So the volume is growing at the pace that we expect and at the pace that we need to get to the $1 billion in peak revenue in 2029.

As far as the patient retention with new competition coming in, as I mentioned in the remarks, our patient retention has been identical to our ongoing trend, not affected at all by the new products coming in the market, and we expect that to continue.

Yes. And I'd just add, the logic behind that is these patients are really well controlled. They're getting similar control to injectable drugs, and they're on a once a day pill. And so what on earth would they switch to that could be better than that.

And then gross to net is still about 15%, as we've announced earlier this year.

And next year in that 15% to 20%...

Yes. Next year, it will still be in the 15% to 20%, probably a little closer to the 15%.

The next question comes from Laura Chico with Wedbush Securities.

One question with respect to the new prescriber numbers. I think this is the second quarter in a row you've been over 60. Just curious if you have any feedback, market research that can help us understand why they're deciding to prescribe now? What has been kind of the motivating factor more recently to accelerate the adds here? And then I guess, if you could share a little bit more color on what would the expected blended royalty rate look like in '26? I know you're projecting a step down over time here, but just kind of curious how we should be thinking about it directionally from '25 to '26.

I'll start with -- thanks, Laura. I'll start with the prescriber data and then hand it over to Babar on the royalties. So the motivating factors, and we've described this before, is just physicians getting more and more comfortable with the long-term evidence, the real-world evidence for how well ORLADEYO works. What they understand now is that ORLADEYO works very well, equally well to injectable products in most patients. It either works or it doesn't. And if the patients don't have the benefit that they need, they move on. So physicians are really understanding that. That's the first part.

The second part is our ability to find prescribers in this market and accurately target means that we are able to find physicians who have a smaller number of patients. So if you have one HAE patient, we will find you and ORLADEYO is becoming the treatment of choice for those doctors. Overall, as we grow the number of physicians, we consistently see a pretty equal balance between those smaller prescribers as well as the top 600 or so doctors that treat 50% of the market. So we keep chipping away at those top prescribers and launch to date over 80% of those doctors have prescribed. So we're really thrilled to show this consistent progress expanding the number of prescribers.

And just one other thing I'd like to add, Charlie is, there's still physicians out there even in the top prescribers that haven't written for ORLADEYO. And one of the things we're extremely excited about next year is the pediatric approval because these docs have pediatric patients, many of them, and there is no reason that they should use anything but ORLADEYO for prophylaxis for these patients. So we think that's going to open up even more new prescribers next year.

Yes. And on the royalty section, we are pleased to share that this quarter, we are tripping over the lower threshold, and it will continue to come down. As you can see in our slides, prepared slides, the rate is in the early -- the blended rate is in early teens. And while we have not given 2026 guidance, I can assure you that rate continues to come down because there's a cap on some of those royalties when you hit the $550 million. But as you can imagine, when we are out to provide you guidance, when you do the math, it will be -- it will continue to decline. And as we've said, over time, it will be in single-digits as we pay off the OMERS liability altogether.

Yes. So as revenue goes up, profitability gets better and better and cash flow continues to flow. So it's a very bright financial future.

The next question comes from Stacy Ku with TD Cowen.

Congrats on the progress. So we have a couple of questions. First, on the new entrants, our KOLs do indicate there are a couple of patients switching from ORLADEYO to injectables, but the same clinicians are also saying that they expect ORLADEYO's share to stay stable. So beyond this anecdotal feedback and obviously, you all have highlighted the 1-year 60% retention. Are you able to share any recent metrics to suggest ORLADEYO is unlikely to be impacted by these injectable entrants? That's the first question.

And then the second is on that pediatric HAE approval. As we approach the PDUFA date, maybe help us understand your views on the opportunity and what commercial strategy and preparation is ongoing to really make sure you all maximize that pediatric expansion? Are many of these patients already identified? Just help us understand as we get to the new year, any type of expectations around maybe some latent patient demand.

Sure. Thanks, Stacy. As far as the new entrants, yes, of course, some patients are switching from ORLADEYO because 40% of new patient starts on ORLADEYO drop off within the year. And in the past, they might have dropped off to TAKHZYRO and HAEGARDA, now maybe they're more likely to switch to some of the new entrants. So that's exactly what we expected. What we're not seeing, though, is a change in our new patient prescribing patterns or a change in our overall retention rate.

And as far as the data that give us confidence in this, as I mentioned, Slide 8, we redid our market research. We redid our big conjoint analysis and market simulation with all the new information about new and future competitors. And what you see is no change to our prior versions of this market research. It shows that ORLADEYO remains -- ORLADEYO patients remain very sticky, and we expect that to continue.

As far as the pediatric approval, we see that there are about 500 patients today diagnosed with HAE under age 12. And only about 40% of those patients today are on or kind of in the prophylaxis space have tried prophylaxis. So we think that there's an opportunity both to grow the use of prophylaxis within pediatrics as well as for switching because an oral therapy is important to a lot of patients, but it's particularly important to kids with HAE.

So as far as our strategy, and Jon mentioned earlier, the doctors that treat kids with HAE tend to be the same physicians that are treating patients over age 12. So we're already calling on these physicians. We know who is treating kids, and the team will be ready to go with the launch shortly after approval.

The next question comes from Steve Seedhouse with Cantor.

I was hoping you could expand on the decision to deemphasize, I guess, avoralstat for DME. Have you had an early look at the Phase I data there? And then looking at the updated pipeline slide, the undisclosed programs listed for rare diseases, at least that are preclinical. Can you give us some insights into what you're working on there preclinically and how close it might be to the clinic?

Yes, I'll take that one. So regarding avoralstat, no, we haven't seen any of the data. We just enrolled the first cohort. And so this is a decision based on focus and expense. And by bringing a late-stage product like navenibart into our pipeline, we need to create space to be able to fund and bring that to the finish line. And these DME programs get really expensive the further on you go in clinical development. And quite honestly, we don't have the expertise there we do in rare disease. And so we just think it's better in the hands of somebody who has that expertise.

And then on the undisclosed, we're not going to disclose what it is. It's early. It's exciting. But when it's ready to be shared, we'll have more information to share with you.

Okay. And just quick on Netherton. Have you had any dialogue with regulators there and forming an understanding of what a pivotal program requirement might be?

Yes, we have. Not enough to share with you the design of the pivotal program at this point. I think the biggest thing, and Bill, you can correct me if I get this wrong, is the bigger the treatment effect, the better options we have to move fast with this program. And we'll figure that out once we start getting data. But too early to predict kind of the design of the pivotal program. Is that fair, Bill?

That's very fair. I think once we have evidence of the effects of the drug in patients with NS and the safety of the drug in NS, then we'll have complete conversations with regulators about how to get it approved.

The next question comes from Maurice Raycroft with Jefferies.

Congrats on the progress. I'll just ask a couple of quick ones on Netherton. Wondering if you could just talk more about the slower enrollment there and how many patients you'll have in the first quarter data update next year? And do you anticipate dosing higher than the 12 mg per kg? And I'm wondering if you're still exploring the subcu dose? Or is it going to be an IV dosing going forward?

Yes, I'll take the first part of it. You want to take the second. We're only off by a quarter. So it's a very slight delay in the program. And the enthusiasm, as Bill said, by investigators is really high, especially when they see the healthy volunteer data. We didn't expect to see the drug get to the target in healthy volunteers. And so that has been really encouraging data. And then, Bill, do you want to take the second part of the question?

Sure. Yes, we're exploring both subcutaneous and intravenous administration. We'll continue to do that. And we may explore higher doses, that option is open.

The next question comes from Brian Abrahams with RBC.

Congrats on the continued progress in the quarter. Maybe just continuing on Netherton. Can you elaborate a little bit more on, I guess, what you're seeing from a PK/PD standpoint in those first couple of parts of the ongoing study? And I'm also curious what the trigger was for starting that Part 4, which I know you started in recent weeks.

And then just secondarily, separately on ORLADEYO, just wondering what you're seeing in terms of demand from the normal C1 inhibitor population. I think that was a growth driver you cited in the past.

Bill, do you want to take the Netherton and Charlie can take the ORLADEYO?

Sure. So Netherton is a fascinating disease. So it's all about what's happening in the epidermis. There aren't any plasma or serum biomarkers to measure. Secondly, we have a very tight binding, very potent inhibitor. And you have to think about what relationship the plasma concentration is going to have to the effects in the epidermis. And there could, in fact, be a disconnect between how long the drug sits in the epidermis after binding to the target compared to how long it circulates in the plasma.

That being said, of course, we're measuring the blood concentrations of the drug, nothing unexpected there. Solely on that basis, we think that it's worth continuing to explore up to every 2 weeks dosing. But really, it's going to be looking at the effects on the disease. There aren't any pharmacodynamic markers to measure. It's the effects on the disease in patients with Netherton and when we get into that.

Just a clarification, we have not disclosed whether we've started Part 3 or Part 4. Part 3 is just a few subjects with short-term dosing. That's the design. Part 4 enables longer-term dosing, and we look forward to stepping through both of those.

Yes. And the expectation is that the data we'll have in the first quarter is Part 3. Charlie?

Yes. Brian, on C1 normal patients, launch to date, that's been about 1/3 of the patients on ORLADEYO, and that's what we saw in Q3. Q2, you might recall, we had an exceptional best ever quarter for new patient starts. There was an additional bolus of C1 normal patients in Q2 because we released some new data. Q3 looked like the steady high demand that we've seen over the last 2 years with about 1/3 of the patients being C1 normal.

The next question is from the line of Jon Wolleben with Citizens.

Just looking at sales so far this year in your guidance, it's implying that we're going to see a drop in quarter-over-quarter sales for the first time. We haven't seen that seasonality before. So hoping you could talk a little bit about your expectations, what's driving that? And if that's something we should expect moving forward or if this is going to be a one-time seasonality effect?

Yes, Jon, it's going to be a one-time seasonality because we just sold our European business. So we're losing the sort of $10 million to $15 million of revenue that otherwise would have occurred. So next year, you will not see a drop in Q4.

Mr. Jon, does that answer your question?

Yes.

The next question comes from Belanger Serge with Needham & Co.

This is John on for Serge today. Just wanted to touch on pediatric ORLADEYO with the ongoing review and the PDUFA in mid-December. Just curious if you guys have seen any impacts from the government shutdown, whether you've had continuous feedback from the FDA and whether you expect them to still meet that PDUFA. And then pending product availability, do you have any expectations for how the payer landscape will look in this segment? And whether or not you could expect a bolus of patients to come on board early upon product launch?

So I'll take the first part. Charlie, you take the second. So with regard to the interactions with FDA, we're getting closer to the PDUFA date, and we're going through the things you think you would be going through at this point, late-stage in the review process. So there's nothing that we see that gives us concern about the government shutdown, that could change, but at least where we sit today, nothing that we see.

And John, as far as payer landscape, we are in a really great spot with payers with ORLADEYO, and we expect the peds indication to slide right into that. So nothing special on the payer front. As far as the bolus of patients, we know that there's a lot of anticipation for this product. I'm sure we'll update you after we launch and get product into the market, we'll update you in 2026 as to the pace of patient growth.

The next question comes from Gena Wang with Barclays.

Wanted to ask about the Netherton syndrome also regarding the 12-milligram per kg IV dosing, by the way, very impressive biomarker data. I'm wondering what kind of safety you see in the patient -- in the healthy volunteer data? And then also, regarding the first quarter, the Part 3 data. So maybe if you can lay out what we should expect from this 1Q '26 data update from Part 3?

And quickly, just housekeeping questions regarding ORLADEYO. I know you mentioned some of the comments, but I do wanted to double check with the actual numbers regarding the retention rate, are we still similar around 60% and the pay rate, I think last quarter, we talked about could be by year-end, 82% to 83%. Is that still the same? And then lastly is the patient segment, 50% switch from other prophy, is that still the same?

All right. So Bill, why don't you take the safety and the design of the Part 3? And then Charlie, you can take the ORLADEYO.

So there's -- really, the thing to say about safety in healthy subjects is that it's very safe so far, it's been very safe and well tolerated. So there have been no safety signals emerging with multiple doses of the drug through the dose that you mentioned. So that's really good news. I think that with regard to what you can expect from Part 3, this is very short-term administration of the drug in Part 3. We're at the cutting edge of clinical science and investigations into Netherton syndrome with a parenteral drug. So we'll be discovering how long it takes in order to get an effect. So I don't know that yet.

Will that short-term administration be enough to see an effect? Don't know. If we do, that would be very encouraging. If we don't, we'll just give the drug for longer and maybe we'll increase the dose. So I think I would temper expectations with regard to what we might see from short-term dosing in a few subjects with Netherton. Obviously, we'll be looking at safety. So we'll learn a lot and look forward to extending the dosing in Part 4 of the study. The sorts of things that you would measure are pretty obvious, itch, pain, skin redness and the like.

And Bill, we're testing multiple doses in the Part 3. So we'll get that and start to zoom in on what we then want to look at Part 4. Is that right?

It's the first step for more extensive testing in Part 4.

Great. Charlie?

And Gena, as far as the ORLADEYO numbers, so yes, the patient retention rate is in line with exactly what we've seen over the last several years. So 60% of patients who start ORLADEYO make it to a year. And everything that we saw in Q3 tells us we're right on track with that same number. The paid rate, we ended Q3 at 82%, which is right about where we thought we would be. In Q4, I wouldn't be surprised if we end closer to 81%, even 80%.

Typically, in the second half of the year, the paid rate starts to decline because we have all these new patients coming in and less of an opportunity to switch people from long-term free product to paid product. That opportunity comes in Q1 into early Q2 of the new year. And so we're right on track for where we need to be, and we expect to have a lot of those patients then switching to paid therapy earlier in 2026.

And then as far as the source of business for patients, yes, the same basic trends where we get close to 50% of the people switching from other prophy history with other prophy products and then other patients switching from acute only coming over to prophy. And then a good number of patients, best we can tell, are starting ORLADEYO as their first HAE treatment ever because more of those are newly diagnosed patients.

Thank you. This concludes the question-and-answer session. I would like to turn the conference back over to Jon Stonehouse for any closing remarks.

Yes. We thought about ending the call with the rolling stones. This will be the last time, but thought different of it. But let me say this, it's been an honor to lead the employees of BioCryst for nearly the last 2 decades. Proud of what we built, what we've accomplished together and extremely excited and confident to see this team take the company into the future by delivering more and more innovative treatments for patients living with rare disease because in this industry, that's how you create real value. So thank you for your interest in our company and have a great day.

Thank you. The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.

Good day, and welcome to the BioCryst Pharmaceuticals Conference Call. [Operator Instructions] Please note this event is being recorded.

I would now like to turn the conference over to Nick Wilder with BioCryst. Please go ahead.

Good morning, and welcome to BioCryst's conference call to discuss its proposed acquisition of Astria Therapeutics. Participating with me today are CEO, Jon Stonehouse; President and Chief Commercial Officer, Charlie Gayer; and Chief Financial Officer, Babar Ghias.

A press release and slide presentation about today's news are available on our Investor Relations website. Today's conference call will contain forward-looking statements, including statements related to the proposed transaction, including financial estimates and statements as to the expected timing, completion and effects of the transaction. These statements are subject to known and unknown risks and uncertainties, which may cause our actual results, performance or achievements to be materially different from any future results or performance expressed or implied in this presentation.

For additional information, including a detailed discussion of these risks, please refer to Slides 2 and 3 of the presentation.

I'd now like to turn the call over to Jon Stonehouse.

Thanks, Nick. We are very excited to announce the acquisition of Astria today. This strategic move will be the source of the next product to market for BioCryst that supports our strategy in several ways.

Let me start by reminding you of the growth pillars of our strategy, so you understand where the deal fits. The first pillar is we have a highly profitable growing product in ORLADEYO, that is on its way to $1 billion at peak around the end of the decade and IP protection out to 2040. ORLADEYO is the source of double-digit revenue growth for the next few years before we bring other products to market.

The other two pillars are intended to answer so what comes after ORLADEYO. The sources for this are our discovery engine and business development. In both cases, we're focused on rare disease assets as we've built a highly effective commercial engine and supporting infrastructure to drive ORLADEYO growth. This will be leveraged to support and drive growth and profit for future rare disease products.

So, the next products to fulfill this strategy are from our discovery team, we are currently developing BCX17725, a promising early-stage compound to address patients living with Netherton syndrome.

And today, with the announcement of the acquisition of Astria, we are adding a late-stage compound for patients with HAE, Navenibart to our pipeline. We believe Navenibart is a perfect fit next product for our company, and Charlie and Babar will explain why.

With that, I'll pass the call to Charlie.

Thanks, Jon. We have watched Astria with great interest for several years, because we knew they were developing something special. So, this is a very exciting day for us. Beyond what this transaction means for BioCryst, we believe it will mean even more for patients.

BioCryst started engaging with the HAE community over a decade ago, when we began our first oral therapy development program. What we learned then and have continued to learn over the many years is how important it is for patients to have treatment options that meet their needs.

With ORLADEYO, it was the promise of a safe and effective targeted oral therapy to prevent attacks. And we are grateful to the patient community, because we would not have succeeded without their support and encouragement. ORLADEYO continues to grow as expected. We had another strong quarter for demand in Q3, in line with what we have seen over the past 2 years with no impact from new competition. This tells us what we already know from our deep market insight work.

Patients only switch therapy if another option satisfies an unmet need in a meaningful way. We believe Navenibart is a potentially transformative therapy that will meet the needs of many patients, particularly those who are already on injectable prophylaxis therapy.

There's about 5,000 HAE patients in the United States alone. The potential for Navenibart to be transformative is especially true for patients on TAKHZYRO, the current market leader. TAKHZYRO is a very effective drug. And TAKHZYRO and ORLADEYO have established a kallikrein inhibition as the standard for HAE prophylaxis. But roughly 70% to 80% of patients on TAKHZYRO require injections every 2 weeks based on real-world data presented by the manufacturer. A sizable proportion of patients are willing to treat that way despite a high rate of injection pain, because the treatment controls their attacks.

But what if they could control their attacks with similar efficacy with an injection that doesn't hurt and do it 2x to 4x per year instead of 24x or even 12x per year. Low dosing frequency is the main remaining unmet need identified by HAE patients and their physicians. And they see every 3-month dosing as the tipping point that would motivate a switch. That is the potential of Navenibart.

The opportunity to bring this potentially best-in-class product to patients is incredibly exciting for us. We believe our team at BioCryst is second to none in terms of commercial execution in the rare disease and HAE space. Our team has deep HAE experience. We have the ability to use real-time customer data. We have the ability to market directly to thousands of HAE patients and HAE treaters. This experience and expertise will allow us to accelerate the launch curve for Navenibart and help the greatest number of patients even as ORLADEYO reaches and maintains peak revenue of $1 billion.

With the two products together, we believe our HAE portfolio could drive double-digit annual revenue growth that will reach at least $1.8 billion by 2033.

I'll turn it over to Babar to describe this transaction in more detail and how it will be transformative for BioCryst.

Thanks, Charlie. On our last earnings call, right after we announced the sale of our European business, we emphasized the role of BD as one of our key growth pillars, which Jon described earlier. We shared that this growth would come from both HAE and non-HAE opportunities as our plan is to be a rare disease consolidator. We said that the first deal needs to make very clear strategic sense. And while finding the right opportunity can take some time, I am thrilled that our first transaction checks all the strategic boxes and timing could not be more perfect.

ORLADEYO continues to deliver strong performance and with a steady-state cost structure, every dollar of growth is now contributing significantly to our operating profitability and cash flow generation. With the addition of Navenibart to our portfolio upon closing of the transaction, we will be poised to deliver double-digit growth upon potential approval and more impressively, on a significantly larger revenue base.

We expect very minimal incremental SG&A investment required to commercialize Navenibart, as we have put in place already one of the best commercial engines in the rare disease space. That low investment, combined with accelerated revenue is expected to supercharge our earnings growth well into the next decade.

Let me comment on the near-term financial impact of the acquisition. We have shared with you that with the closing of the sale of our European business, our cost structure will be simplified and our operating profitability on a stand-alone basis is expected to significantly improve. So, even after absorbing the R&D development spend of Navenibart, we will remain highly profitable on a non-GAAP basis and cash flow positive.

We expect the first full year of revenue after Navenibart's anticipated launch, we will be significantly accretive to operating profit. We will guide to the relevant combined numbers post closing of the transaction, which is expected in Q1 of 2026. We will be financing this acquisition with a mix of BioCryst equity issued to Astria shareholders to enable them to participate in the upside here and the remainder with cash.

With the sale of our European business, we have retired the remaining Pharmakon debt of approximately $200 million. To finance this new acquisition, we have entered into a strategic financing partnership with Blackstone at a highly attractive cost of capital with access to up to $400 million of cash for this transaction.

Due to our continued growth behind ORLADEYO and improving cash flow profile, we anticipate to achieve over $1 billion of cash on hand by 2029. Our plan is to continue our strategy of becoming a rare disease consolidator and the partnership with Blackstone provides us with further access to capital. This acquisition timing is perfect as we are hitting so many critical milestones for the business. But most importantly, I'm excited about what this means for the patients. We are uniquely positioned to continue the growth of ORLADEYO and accelerate the vision of Navenibart, meeting the needs of patients with multiple therapeutic options.

We will now open the call for Q&A.

[Operator Instructions] The first question today comes from Jessica Fye with JPMorgan.

The next question comes from Stacy Ku with TD Cowen.

Congratulations on this announcement. So first, just curious because we've been getting some investor feedback and questions. There is some precedence with Shire's acquisition of Dyax. But just comment maybe high level, your level of confidence, what you all are putting together, maybe the differences between oral and injectable in the market space and, let's say, separation there as we think about the Q1 closing. So, that's the first question.

And then, when it comes to the competitive landscape, can you just maybe talk about what work the team did when it comes to both public and private companies in the HAE prophylaxis space and how you went in on Navenibart? So that's the second, especially as we think about maybe some of the private companies that are coming along.

And then the last question is, maybe on Navenibart development. Do you expect early '27? And we understand this is still early days, but just given your relationships and assuming Q1 closing, do you expect early '27 will be conservative timing for results?

Yes. Let me take the first one, then Charlie, you can take the next two. So, the first one regarding precedent in the space of companies having more than one product like Takeda now, yes, there's more than one CSL as well. And so, there's definitely tons of precedent, and there's tons of competitors in the space. So, we think -- and Charlie said in his prepared remarks, these complement each other really well, and there's plenty of patients that still seek injectables that we think are an opportunity for us. Charlie?

Thanks, Jon. Yes. And what I'll add to the oral versus injectable as well is that, patients tend to have a very clear preference based on where they are. So, brand-new patients to prophy really prefer oral. Patients who are already doing well on an injectable would prefer to have an injectable that even better meets their needs, specifically with dosing. And so, that's where we think that this makes a lot of sense.

As far as the landscape for competition, as I mentioned in my prepared remarks, the real tipping point for patients on injectable therapy today that would make them switch is every 3-month dosing or better. And we think that Navenibart with a known profile with that potential for 3- to even 6-month dosing, and the fact that they're off to a good start with their clinical program gives this product a first-mover advantage. And so, as we've looked at other products, we think that Navenibart is likely to be the first one to launch with that profile.

And then, -- sorry, Stacy, I forgot your last question.

The last one was topline data in early '27.

Topline. Yes. So we think that, again, Astria has got a very strong team. They're doing all the right things. So, early 2027 data will be great. Of course, when we're able to complete this transaction, we have a lot of experience as well, and we'll do whatever we can to keep that timeline or improve it if we can.

And Stacy, the last thing I'd say on your second question is, this is a sticky market, as you very well know. And that first-mover advantage, if you've got patients that are well controlled with really convenient dosing, they're not going to switch to something that has similar dosing.

Okay. Wonderful. Well, congratulations. We obviously done a lot of work in the HAE space and also really like Astria. So, thanks.

The next question comes from Laura Chico with Wedbush Securities.

Congrats on the deal. I'm not sure who to direct the question to Jon, Babar. But could you talk a little bit more about the downstream revenue opportunity for Navenibart and kind of how you're building your assumptions there and the market opportunity and just kind of the overall peak assumptions? And then secondly, could you share any color on whether this was a competitive process?

So, yes. I think on the revenue, as we have shared with you, ORLADEYO continues its trend to be a $1 billion product. Naturally, we have a very high level of confidence on the Navenibart product. And so at this point, we're not sharing any projections. But what I can share with you very confidently is beyond -- Navenibart starts to hit our profile right when the growth for ORLADEYO comes to a steady state. So, that enables us to basically build on to that double-digit growth and well into the next decade. So, I think we are very confident that with the machinery that we have put in place, we will absolutely deliver on that double-digit growth.

And on the second question around competitive process, the proxy will go out from Astria, and you'll know the details of the process.

The next question comes from Steven Seedhouse with Cantor.

Congratulations on the proposed deal. Two questions. One is, I guess, I'm interested or maybe even surprised that you're not planning to develop the OX40 antibody that you're getting from Astria here as well. Is that because it doesn't fit in the sort of orphan disease strategic focus? Or is there something else to say there?

And then also, I would ask you to sort of expand your comments on just appetite for additional deals after this? Where does this leave you in terms of what you're thinking about in terms of being acquisitive going forward?

Yes. So I'll take the first one, and Babar will take the second. On OX40, we think it's a really interesting product, but it's not rare disease, and it's better in the hands of somebody that's in that area. So, that's the reason, that's the rationale. So you're correct. Babar?

Yes. So, I think, we've done a very transformative major acquisition. So, our first plan is to make sure that we make Navenibart the priority, and integrate this acquisition well. But naturally speaking, ORLADEYO will continue to put points on the board. And as we said that, while we anticipate that by 2029, we'll have $1 billion cash balance, we are not going to sit on that. So, our plan, once we've integrated, once we made sure Navenibart is on its way to potential enrollment success as it continues to do, we will be looking at other opportunities as well.

Yes. And I think -- listen, I've been in BioCryst for almost 19 years. This team just showed you that they have an appetite for this, and we'll continue to do this.

The next question comes from Brian Abrahams with RBC Capital Markets.

Congrats on the deal. Just commercially speaking, what are some of the different considerations that to take into account for marketing a long-acting injectable in the space? It sounds like there's going to be limited additional SG&A spend, but I'm just curious how that might adjust and where you might be making the commercial investments.

And then just secondarily, it sounds like most patients are on TAKHZYRO every 2 weeks and every 3-month dosing could be a tipping point, but HAE is also, can be a sticky market. So, I guess I'm curious what your market research tells you could be the potential conversion of patients from current to future long-acting injectables and maybe the types of patients who would switch?

Charlie, do you want to take those?

Sure, Brian. So as far as the different considerations, clearly, as we've laid out, the patients have strong preferences one way or another based on where they are in the market. And so, that will be a big part of our marketing campaign. I think, another really important part is getting patients access to therapy. And we've built, what we think is also a second to none program with helping patients with patient services and market access.

We've done a great job with ORLADEYO, and we would expect to do a great job with Navenibart given our services and the profile of the product. And as far as additional investments, we have -- we continue to believe we have the sales force that is the right size out there. We've got a great marketing team. There'll be incremental investments as we continue to grow with ORLADEYO on the patient services and market access side. But there really don't need to be huge investments. We -- one thing we do, do also very well is develop real-world evidence around our product, and we would expect to do that in the future with Navenibart. It's been an important part of our ORLADEYO story. It will be an important part of Navenibart as well in the future.

I mean, here's a simple exercise for those of you that cover Astria as well as you take our model with the growth of SG&A that you have planned and you take the revenue from Navenibart and you take the development cost for Navenibart, and that's it. And run that model.

The next question comes from Jon Wolleben with Citizens.

Congrats on the transaction. Wondering if you could talk a little bit about the confidence you have around Astria's early data set being relatively small in open label and what you anticipate to see in a Phase III profile? And if you think these impressive efficacy rates will stand up? Or is this going to be the longer duration driving adoption or if it's going to be a competitive profile. So, just if you could talk a little bit about what you want to see in a target product profile coming out of a Phase III trial?

Yes. Thanks, Jon. We're very impressed with the early data from Astria. And if you recall, going back to lanadelumab in the early days. Lanadelumab also showed very impressive early data in a Phase Ib study. So, there's a real analogue to what Astria shows. The difference being, of course, Navenibart has the 3- to 6-month dosing and greater than 90% attack reduction across both doses is very impressive to us.

So, where we think the need for efficacy in the market is largely met across the board. For some patients, if they don't get efficacy on one product, they have other options, which is great for patients and they move. But the market isn't looking for more efficacy. What it's looking for is less burdensome dosing. And that's what Navenibart has the potential to provide with every 3- to 6-month dosing. And what we've seen in our market research again is that, that 3-month profile with very low to no injection site pain is really something that gets patients' attention and we think is a tipping point to what will make them switch.

And Charlie, the projections you guys gave out today, is that assuming just that every 3-month works or that the 6-month works as well? Or is that an upside scenario to what you guys are thinking about?

No, it's really a blend of both, but 3 months alone is the really significant thing. 6 months is just icing on the cake.

The next question comes from Gena Wang with Barclays.

Also congrats on the deal. So, maybe two questions regarding -- one is, what will be additional clinical trial cost before the data readout in early 2027? And the second, when I look at the Phase III trial design, they do have three cohorts that was a placebo. So, total trial size is relatively small. Maybe if you can share a little bit of thoughts on the trial design. Is that any cohort positive approved or three cohorts versus placebo to be positive and that will claim positive outcome? So if you can share a little bit more color on the ALPHA orbit clinical trial design and maybe some assumption behind it?

Babar, do you want to take the first one on the cost, and Charlie, you take the trial design.

Yes. So, Gena, thanks for the question. So we have not -- we will not be naturally giving guidance as to the projections of the spend right now, because the transaction is still pending approvals. Once the transaction closes, we will be back and revise our operating guidance for 2026 when we are ready to do so. Having said that, as I said before as well, that with the divestiture of the European business, our stand-alone business is going to deliver strong operating profit growth. And even when we add the development spend, when we will guide you at the right time, you'll see our profitability will remain quite strong.

So, maybe I'll hand it to Charlie for the second question.

Sure. We think that the Astria team has been really smart in how they've designed this trial given the precedence in the HAE space, but also given the newness of every 3- to 6-month dosing. So based on the likely efficacy of this product, we think that all three cohorts are likely to show statistical significance. The key is just getting them all enrolled, and we think that the Astria team is off to a really good start on this.

The next question comes from Maurice Raycroft with Jefferies.

Congrats on the update. Maybe just a follow-up to just how you're thinking about the $1.8 billion assumptions there. In the past, you showed a Monte Carlo simulation with some projections for Navenibart, and it seems higher today. So, just what's changed since then for your projections? And how do you view the future breakdown in market share for both ORLADEYO and Navenibart?

Yes. So just to clarify, we are not giving projections on Navenibart. As we highlighted, that is based on a Wall Street consensus average number. But as we have said repeatedly that we feel very confident that ORLADEYO is on its path to $1 billion product. And with respect to the projections, yes, you're right. We do a highly, highly comprehensive market survey in terms of all the products and things. But I think, it's important to note what it does not tell you is the execution risk for some of these products. And that's where I think people underappreciate how difficult it is to commercialize a rare disease product and particularly in a space where there are many incumbents. And we have repeatedly shown that. We continue to show that.

So, that is why, I think, we feel so confident in terms of hitting that double-digit revenue growth on a going-forward basis when Navenibart -- when ORLADEYO starts to become a steady-state product.

And I'd just add to Babar's point about execution is, if this deal goes through, we have the better part of 3 years to prepare for the execution, and our team is ready for that.

Yes. Honestly, I would argue that there's no better team to launch this drug than BioCryst, right, with the experience that we've had with ORLADEYO.

The next question comes from Serge Belanger with Needham & Co.

This is John on for Serge today. Congrats on the acquisition. I just wanted to double-click on the commercial dynamics between ORLADEYO and Navenibart, that is if Navenibart is approved. Would you expect any potential pressure to ORLADEYO considering the improvements in dosing and the levels of efficacy that Navenibart could provide even considering the stickiness between the market segments? And then second, quickly, if you could provide any color on the IP landscape for Navenibart right now, that would be great.

Sure. Thanks, John. On the first question, with any pressure between the two, what we've shown repeatedly and described repeatedly is that, when patients start ORLADEYO, 60% of them make it to a year, because they're doing really well and very few of them drop off after that. So, we expect that dynamic to continue. We think the great opportunity potentially with Navenibart is those other 40% may choose to move over to an every 3- or 6-month dosing with Navenibart. So, we don't expect pressure on ORLADEYO. We expect that the two products can offer patients what they need in an oral or in an injectable setting. And as far as the IP landscape, we're very comfortable with their IP out to 2042.

And that was a key component in the diligence process.

The next question comes from Jessica Fye with JPMorgan.

Can you speak to your confidence that the FTC will be comfortable with this transaction?

Yes. We have no reason to believe that we won't be successful with the regulators, and there's tons of competitors in the market currently, and there's more coming. So very confident. Sorry, we lost you there, by the way.

This concludes our question-and-answer session. I would like to turn the conference back over for any closing remarks.

So, let me wrap up with this. We've been saying for a while that BD is a key component to our strategy. And as Babar said earlier, we've also been saying that the first deal needs to make a lot of sense. And so, good fit, high probability of success, right timing in terms of gap filler with our pipeline and then driving revenue growth into the next decade.

And today, I believe we've announced a deal that checks all those boxes. So as always, thank you for your interest in BioCryst. We look forward to continuing to keep you updated. Have a great day.

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.

Good morning, everyone, and thanks so much for joining us for our next session. I'm Steve Seedhouse with the Cantor Biotech team. It's really a privilege to welcome our next participating company at the conference, BioCryst Pharmaceuticals. Thanks to everyone on the webcast and in the room for being here also.

And I'm joined on stage by CFO, Babar Ghias and President and CCO, excuse me. And I guess there's a lot of change in the title. So we'll say emerging CEO as well, Charlie Gayer. Thanks so much for being here. We would love to pass the mic over and just ask for an intro to BioCryst, current state of affairs, outlook for the rest of the year for some opening comments, and then we'll dive right into Q&A.

Sure. Thanks, Steve. We're really pleased to be here. Babar and I will be making some forward-looking statements. Those statements have risks. You can find those risks in our SEC filings at bioocryst.com.

BioCryst is in a really exciting place right now, and I'm excited to be taking over CEO in January because we have ORLADEYO, which is going to sell $580 million to $600 million globally this year and is growing at about a 20% CAGR. We are in the process of actually selling our European business, which will close early in October, and that's going to give us an opportunity. That's actually a business that, while commercially was going very well, was not profitable for us. And so the $250 million we get from that deal is going to allow us to really improve our balance sheet, and that creates more options for us.

We have an emerging pipeline that we're very excited about. We expect to have patient data later this year in -- first of all, in our BCX17725 in Netherton syndrome, a rare, very serious dermatological condition, and we think that has the potential to be another market like HAE. And then we've got our avoralstat product that we're testing for DME. And we think that there's a role for a kallikrein inhibitor in DME, and we'll have patient data as well at the end of this year. So we're set up very well, and we're excited.

Babar joined us earlier this summer as CFO and also the Head of Corporate Development. So another part that we're adding to our strategy is the ability to go out and look for incoming BD deals to add to our portfolio. So it's a very exciting time for us.

Yes. Maybe I would ask Babar, you can follow up with some comments because my next question was just on the timing of the management change and just both of your strategic outlook now on the new BioCryst. And certainly, the company has been sort of putting out the bad signal of interest in acquiring assets and being the consolidator of rare disease assets in the U.S. So I would love to get your perspective on just what the next 5 years of BioCryst are going to look like and what type of company and franchise you're looking to build?

Yes, absolutely. And I mean, if you look at it, our first pillar of strategy is do no harm to ORLADEYO. ORLADEYO is on a great trajectory. Pipeline is doing great early, and we're going to balance this out with more of like what's the in between. And what we'd ideally like to do is launch another product because of the great infrastructure that we have built.

And I think we can leverage a lot of that infrastructure. So we would be ideally looking to bring another product to the market over the next few years. So when you talk about the next 5 years, I think that's the perfect horizon for us before the end of the decade. ORLADEYO will still continue to grow, and we are able to bring out another product and then the pipeline can provide growth beyond this decade.

So I think that is another strategic priority for us, bringing something late-stage orphan, we continue to be an orphan disease-focused company and then naturally leveraging the infrastructure that we've put already on such a successful path, to use that with another product.

And Charlie, just maybe stylistically going forward, I mean, as you step in ultimately to the new role as CEO, anything that you would maybe guide investors to expect differently or anything that you would carry forward as what folks are familiar with BioCryst over the years?

Yes, I think there -- from the standpoint of what carries forward, as Babar was commenting on, ORLADEYO is going great. Like we have really shown that we can commercialize rare disease products extremely effectively. And we can figure out with products that others may not see the same opportunity, just like ORLADEYO. We saw something in ORLADEYO early on, and we were able to execute on that. So I think that is something that will continue, and we really want to double down on.

BioCryst, for all its existence, has been built on discovery and development of our own products. And we'll continue that. But what's great is we don't have to depend on that anymore because of what we've built with ORLADEYO. So I think it's a mix of what stays the same and continues, but then we're adding to it because we're in a stronger position.

Okay. Before I even get into some of the questions that I had written down, I wanted to follow up on just the EU business and the fact that, that wasn't profitable. I mean, is that a dynamic in HAE that holds for other regions beyond just Europe where it's just going to be very difficult for a BioCryst to turn profitability? Or what drove that relative to, obviously, a business that as we sit here today, is profitable in the U.S.?

Yes. What drove that? Our strategy was to continue to build and launch future products in Europe. We had Neopharmed Gentili, Italian company came to us with a really attractive offer. They wanted our team and our product to build a rare disease consolidator strategy in Europe. And the $250 million plus another $14 million in future milestones was just an offer that was really full value for the whole future of that business.

The European business was still attractive if you can add more products. It's expensive to run a business. And then obviously, the pricing isn't quite the same. So it was attractive, but not as attractive as the U.S. market. Other regions will -- it will vary. We still have our Japanese business, and we expect that to become profitable because we have good pricing there. But this just made sense for us right now, and it allows us to focus primarily on the U.S.

So ORLADEYO, you mentioned several times, and I agree, I mean, that the productivity and the growth there has been tremendous. But the market dynamics are shifting. There's a couple of new approvals in prophylaxis in ANDEMBRY and DAWNZERA. Just remind us sort of how you're viewing the impact of that competition, expectations you'd want to set and really any early impacts you might already be seeing in terms of switching or competition for new patients?

We've -- a part of our success, as I said, has been the deep research that we do. And so every year since before launch, we do a big study to do our best to forecast the future in the market. So we survey a large number of patients and physicians and payers and get their preference view on all current and future products. And then we run that through a big simulation model, and it's been very predictive of where ORLADEYO has grown to.

And what that model and the research tells us is these new injectable products, while it's great for patients to have new options, the -- going from a 2-week injection every 2 weeks to every 4 weeks isn't a big market changer for patients. And so we don't think it's going to have an impact on the trajectory of ORLADEYO because we have the most differentiated product with the only oral once-a-day prophylactic therapy out there.

And so what we expect is more of the continued growth. We actually think that competition is good because it creates more discussion around switching. And we know that most patients would actually prefer to be on an oral prophy if they could. So we think that competition actually creates some opportunities for us.

Interesting. So it's almost as if, "Hey, there's these new therapeutic options for you. But by the way, have you considered ORLADEYO?"

You should -- if you haven't done this already, you should try this now. If it works for you, you should expect fantastic efficacy. If it doesn't work for you, then you have other options you can move on to. So that is an effective story for us.

I mean the other dynamic I think it would be worth commenting on there would be the availability now of an oral on-demand therapy and act early. And for the first time now, a patient would have the option of oral ORLADEYO, oral on-demand therapy, no injections in their life in theory. Are you expecting a positive tailwind from that? Have you seen any early indication of people moving to the oral oral?

It's too early to comment on exactly what's happening. We've heard physicians though, they come up with what they say is, "Oh, I get it, all oral combinations will be great for patients." So we do think it has the potential to be a tailwind. I think it's going to take several quarters to see if that's the case. But it could be something that attracts more patients to ORLADEYO. And it could also be something that helps more patients stay on ORLADEYO if they do -- are able to treat breakthrough attacks with an oral on-demand therapy. So we think it's -- again, it's great for patients.

Do you have real-time insight into if a patient switches from ORLADEYO to ANDEMBRY or one of these new launches? Can you see that happening? And have there been any -- if you can, have there been any patients that have actually made that switch?

I'm sure there have been. So yes, we do. We get pretty good information when a patient switches if they tell us where they go. In the past, as you can imagine, the majority of switches were to TAKHZYRO, the market leader. So I think what will happen is some of those switches will now go to ANDEMBRY. If ORLADEYO doesn't work for you, that's natural. We don't expect it to change our trajectory, but I'm sure we'll lose patients.

Just divide...

Generally to DAWNZERA, yes, that's to be expected. Nothing to worry about, very standard.

Okay. And I mean, given this franchise that you've built in ORLADEYO, I mean, what is the line extension strategy? I mean how can you protect this potentially $1 billion franchises you're expecting?

One -- we do this in a couple of ways. One is that we generate a lot of real-world evidence. Part of this has been one of our real competitive advantages in our sole-source model. We are able to collect information from patients on a monthly basis about their attack rates when they start ORLADEYO, what's their ongoing attack rate. And then we're able to bring that out to the market, to physicians to educate them about the efficacy of ORLADEYO. And that's really led to more confidence in the product amongst prescribers. So we're going to keep doing more of that.

The other thing we're very excited about is the pediatric indication with ORLADEYO granules. We have a PDUFA date, December 12. And that has the potential to open up the age 2 to under 12 market for us. And we think there are a lot more of those kids that actually could benefit from a prophylaxis therapy than has been understood in the past and an oral product clearly is an advantage. And it's -- for the most part, it's a family disease. It's a genetic disease. So in a household, you're going to have mom or dad usually on some prophylactic therapy, kid on a prophylactic therapy. So it's another way to introduce ORLADEYO to a broader audience.

I guess I was thinking about it more from the standpoint of -- presumably, you're not just going to ride out the market exclusivity for ORLADEYO and then you're no longer involved in HAE. I mean you've built this expertise, you've built this leadership position. I've been surprised that there hasn't been more innovation behind ORLADEYO on the oral side in HAE.

I mean there's one asset that's coming up on Phase III data. But beyond that, it's gene editing and it's RNAi. And so that seems like an opportunity maybe to build the next generation or acquisitively just protect the franchise, right? Maybe think about combo therapy. So how are you thinking about that launch?

Yes. So first of all, ORLADEYO has really strong patent protection. So we have composition of matter on the base until 2035, on the salt until 2039. So what we see happening is we'll actually reach peak of $1 billion in global sales around the end of this decade, and then we have the potential to maintain that for the better part of a decade. Developing oral drugs for HAE is difficult. There are many companies that have failed, including ourselves, our first-generation product failed.

And so what we've decided is the best use of our resources is keep investing in what we're doing with ORLADEYO, but then as Babar was talking about, bring in other products to build our portfolio from outside, and then we'll keep building from inside as well.

How has net pricing been evolving? And any expectation that, that would change with sort of this boom of prophylaxis options?

We're -- I think we're in really good shape this year. Our gross to net is about 15% off of -- for paid patients off of list price. We think that we're in a very good spot because now we have 1,500-plus patients on ORLADEYO. So payers view us -- view ORLADEYO very differently from how they viewed ORLADEYO 5 years ago. And so from a market access, a pricing perspective, we feel like we're in very good shape.

Okay. Moving on to the pipeline, then we would love to cover some of those exciting programs. So Netherton, first of all, rare disease. Looks -- I can hardly look at the pictures. I mean, super debilitating for these young children and resolved, I guess, or improved somewhat over time, but certainly for those kids, I mean, there's a huge unmet need here.

So can you talk about your program? Just how many dose cohorts are you sort of studying early on, the type of patients you're enrolling and the data that you anticipate generating this year and into next?

Yes. So for those who aren't familiar with Netherton syndrome, it's kind of a classic rare disease where there's a genetic mutation that causes patients not to have a key regulatory protein that controls skin turnover. So basically, for a normal adult, your skin will turn over every 4 to 6 weeks. For Netherton's patients, it's more like every 2 weeks. And so there's constant body-wide skin peeling, redness, itchiness, puts patients at a greater risk of infection, other like atopic conditions, so asthma, food allergies are common.

And like you mentioned, for kids with this, kids skin turns over even faster. So for young children, it can actually be life-threatening. For adults, it's just very debilitating over time. Our drug replaces that missing protein. So we think we have the potential for an every 2-week injection that can restore normal skin turnover.

So where we're at, we've done healthy volunteers, SAD and MAD. We haven't released that data yet, but we're starting into Part 3 and then Part 4 of our study. Part 3 is going to be a small number, about 6 patients, Netherton's patients studied for 4 weeks. So they'll get 3 doses over a 4-week period, and then we'll track them over time after that. And then Part 4 will be a 12-week study.

What we expect to have at the end of this year is probably less than a handful of patients from the Part 3 of the study where we'll be looking for evidence that the drug is getting where it needs to get to, which is in the epidermis and that it is binding to the uncontrolled KLK5 that the normal SPINK5 protein would be controlling. That's what our drug will hopefully be controlling.

So we'll look to see if we're getting the drug to the skin, and then we'll look for early signs of improvement in skin turnover. With the Part 4, we should be able to see within a few months, our patients having more normal skin turnover restored.

And then my understanding is you can -- those PD readouts in terms of on-target activity, you could do that by sort of the shedding of the skin.

That's right. There's 2 ways. We'll be getting skin biopsies and then also skin stripping. So basically like a tape where you take off the top layer and then you can test to see if the drug is getting in there. And importantly, is the PD effect there? Is it binding with KLK5. And so those are the data in addition to, of course, safety data and general PK data that you should expect at the end of this year.

How well understood is the regulatory path here? Would you be laying that path and...

It's -- there's never been a drug approved for Netherton syndrome. There are other rare disease products that have been approved on similar types of physician and patient-reported scales of improvement. And so we will -- as we get this patient data, we'll be having more conversations with the FDA about that regulatory path.

What we do believe is that this has the potential to be a very small pivotal study if we show that strong effect. It's all going to be about the effect size that we see. And so we're hopeful this is a program that can move pretty quickly. The patient need is certainly there.

Okay. Moving to DME, which is another very interesting program and data that would be forthcoming. What magnitude of -- I guess, retinal thickness here would be the key efficacy endpoint to look for? What are you hoping to show in terms of magnitude of effect in this study?

So for this, it's -- we're doing the SAD study in DME patients. So in this case, one dose with avoralstat -- avoralstat delivered suprachoroidally. So avoralstat was our original HAE drug. It was a terrible oral drug, but actually, we think the properties that made it bad at being an oral drug make it perfect to sit at the back of the eye, dissolve very slowly and inhibit kallikrein that we think is an alternative path to swelling in DME.

So in this first study, what we'll be looking for in addition to safety is, are we reducing central subfield thickness. We'll be looking for an effect of probably 50 to 70 microns reduction. And then very importantly, what is the durability of that effect. And so we'll be following patients to 3, 6 months and beyond to see is that swelling reduced? And then is it -- does it have the potential to be in every 6-month injection.

We'll, of course, collect visual acuity as well, but we're only talking about 9 patients in this first study with 3 dose cohorts. And so we -- I wouldn't expect a lot on the visual acuity side.

How -- so in those 3 dose cohorts, how confident are you in the dose selection here and your ability to hone in on an active dose, particularly because the delivery approach here is novel for the indication. It's been used elsewhere. But are you able to triangulate that device? You have experience with the molecule in HAE, the disease? How does that all fold together?

So yes, we have a lot of safety information on the molecule. So that's good. It's been studied systemically. What we'll be looking for is, yes, again, does the drug have an effect for long enough? We saw great effect and durability of effect in animal models. So we're optimistic from that study.

Remind us, was that with the same injection...

That was with suprachoroidal. So in rabbits, we see that it's actually maintained past 6 months. And you can do it in rabbits because of their larger eyes. We have to prove that in patients as well. We think that the 3 doses could show the effect. And if not, we have the opportunity to go to cohorts higher than the 3 doses.

Okay. Babar, just maybe to bring you back in here, and this is a conversation that I really want to have with you both, which is the strategic outlook and just this messaging that we talked about at the start of the conversation of consolidating rare disease assets and building on what you already have with ORLADEYO. I guess first question is what therapeutic areas are of interest to you?

Yes. No. And I think as we mentioned earlier as well that the priority #1 is to make sure that we stay in rare diseases and leverage the infrastructure that we've built. So we're not trying to fill up a bag, let's say, for our current sales force team.

So naturally speaking, allergy immunology call point is of great strategic interest to us. But beyond that, when we think about rare diseases, we have a program in Netherton syndrome. So that opens up to rare derm indication and derm specialty. But as you go along the sort of broader rare diseases, we are not going to be a solution for every rare disease, but something that has the characteristics of more like HAE, where there's a patient population of, let's say, 10,000 addressable patients where you can approach it with a single-source pharmacy, leverage a lot of the infrastructure.

And when I say infrastructure, building a sales force team, we have 40 sales reps. It's not a large encumbrance, right? It's the infrastructure that we have built, the patient services, the market access, the HEOR, all the systems that we build, that's an investment that is plug-and-play for any new opportunity we bring in. So the incremental investment for any therapeutic area is very minimal compared to what, let's say, starting to build a new team altogether. So I think like some of these allergy immunology areas of great interest, rare derm, metabolic diseases, anything where we can actually create -- to use that infrastructure and create a lot of leverage.

Indeed. And in stage of development, I think you said that you're leaning towards late stage, but maybe just characterize that for us. What do you think of now and...

Yes. And again, to your point in terms of the defensive strategy, we'd like to bring a product in the next 2, 3 years and certainly in this decade to basically continue to grow our business. So that puts us in more of a later-stage spectrum. Our pipeline is early, and that will continue to bring sort of points on the board if it progresses well like on the later part or early into the next decade.

But there's a convergence at some point of doing deals and bringing your internal pipeline that they're basically -- so the first deal has to be very strategic for us and has to tick a lot of boxes in terms of are there synergies with our system? Are we able to commercialize it? Can we make an impact over there? So naturally speaking, our focus in the nearer term will be on later stage and then that opens up the risk appetite for follow-on deals where we can take a little bit more risk.

Okay. And in terms of where the rubber meets the road here ultimately, I mean, what -- how large of a deal can BioCryst do and what structures of a deal are you open to? And has that changed from 6 months ago, 12 months ago? I mean, where are you at today? And just help us understand where you've come from because I think you've been in the market, I think, and interested in this strategically for some time, but certainly now at a different scale and the company is profitable and you're at a different place.

Yes. Let me address the sort of scale perspective question first. And the affordability and the scale question is along 2 parameters, right? A, it's what are the business fundamentals for us. And now as we've shared with you, when the European transaction closes, we haven't naturally guided to for next year yet, but that allows us the ability to clean up the balance sheet, but also, we will have significantly improved margins. We are losing $50 million, but we're losing more than that.

So I think our profitability over the coming years is going to continue to grow. And then because of that, the cash flow generation will be significantly stronger compared to prior years.

The second thing is in terms of like what's the asset profile that we're going after, if it's a later-stage asset and has a higher addressable market, naturally, it will come with a price tag that has to be sort of taken into consideration. Now that being said, we will continue to be very capital disciplined. Just because we are generating cash, it doesn't mean we're going to bet the farm and basically recklessly going to spend. I think it has to be very strategic. So our Board will -- we will work with our Board in terms of making sure what it does for the business.

Now naturally speaking, something that is truly transformative, that's in a totally different ZIP code. So I think our first deal has to make a lot of sense so that investors can also understand that like, yes, this is a natural extension of the strategy.

To your point in terms of structures, I think at this point, it's a great environment. There's a lot of opportunities out there, and you can structure it in various different ways, whether it's staged asset deals or licenses or company acquisitions. I think all of those options are on the table at the moment. And it is a market where there's a lot of willing sellers as well because of the dislocation of capital, whether it's public or private for these biotech companies.

I was just going to emphasize one thing that Babar said, like in the commercial infrastructure, it goes beyond just straight commercial, too. I mean you need more finance people when you're a commercial company than you do when you're just an R&D company.

You need a lot of other functions and BioCryst has built that. And I think the current environment for R&D companies who have their first lead asset, maybe getting in that commercialization zone, they have to decide, are they really going to invest in everything that it takes? Or does it make more sense with a company like BioCryst? And we think there are a lot more opportunities out there than perhaps are sometimes realized both in public and in private companies right now.

How -- maybe I'll just ask directly to the extent you can answer, I mean, how advanced are sort of ongoing conversations and how willing are sellers in this market, either on the public or the private side? And just what are you seeing in the market right now?

So on the willingness, very high willingness. Naturally, there are companies -- and again, this goes back to the point, even if you're a -- let me just address, even if you're a public company in Phase III, but you are sort of, let's say, a year or so away from an inflection point, you need to be spending that capital right now. And I don't think many companies in the market right now are willing to -- or the Boards are saying that go spend capital or go raise another equity round to be able to spend on commercial.

So I think that creates a natural opportunity and launching a drug -- getting a drug approved is great and launching a drug is also a very challenging aspect in terms of the investment that requires. So I think we find ourselves in that point where a lot of these public companies as well are willing to talk where historically they weren't because that inflection point is at least 12 to 18 months away, and they still need that capital. So I think that creates one opportunity.

The second thing is also private companies. And private markets are even more dislocated in that sense that venture funds are not necessarily doing that aggressively the top-up rounds because the step-ups have not been there and the public markets are not there. So that kind of creates that sort of -- that cycle of like, "Hey, seek partnerships, seek M&A, seek other alternatives to capital where ventures dollars do not have to go in and you can get a mark on that investment." So I think that sort of appetite we're seeing has increased both from the public and the private side.

The other thing that is like because of confidentiality, we naturally cannot say how advanced or whatnot. But I think suffice it to say that it is really a buyer's market if you have that infrastructure and you are not dependent on just like raising capital to do a PD deal.

I mean it's consistent with what I think all of our in the room intuitions are in this market right now, but it's good to hear somebody who's out there having these conversations that, that is, in fact, what the reality is on the ground. Maybe I just wanted to also ask, and again, if this -- if you can't comment, it's okay, but I'll try anyway.

I think you said publicly, I mean, with the money from the EU asset sale, you'll clear off the debt from the balance sheet. And -- but presumably, you could use leverage, there would be debt available on better terms than maybe that. Synthetic royalty on ORLADEYO maybe is something that you could think about in terms of financing a deal or just cash on the balance sheet, right, given the profitability -- would any -- would you -- and then, of course, some stock transactions. Like would you exclude any of those ways of financing a deal? Or is everything on the table?

I think I would say anything and everything is on the table for the right type of deal. Naturally, every CEO, every CFO says my stock is undervalued. So there's a natural inclination that what am I using my stock for. But to your point on debt, historically, there were certain avenues of capital like bank debt or term loan markets because we did not have EBITDA. We're getting to that point where basically we'll have last 12 months look on like EBITDA.

So I think that opens up plenty more avenues of capital. And the fact that I mentioned that we will have significantly improved business fundamentals because of the divestiture and the ramp of ORLADEYO that it gives us a big margin in terms of absorbing new opportunities and still remain -- maintain our profitability and cash flow generation.

Well, it's obviously an exciting time for the company. We're looking forward to seeing anything that manifests there. And of course, your pipeline readouts and the continued progress of ORLADEYO. And I just want to thank Babar and Charlie for joining me on stage here. Thanks to everyone for listening on the webcast and in the room. And hopefully, everyone has a great rest of the day at the conference.

Thanks, Steve.

Thanks for having us.