Good day, and thank you for standing by. Welcome to the Aquestive business update. At this time, all participants are in a listen-only mode. After the speaker's remarks, there will be a question and answer session. To ask a question in the session, you will need to press star one one on your telephone. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Bennett Watson of ICR Westwicke Investor Relations. Please go ahead. Thank you, operator. Good morning, and welcome to today's call. I'm joined by Dan Barber, Chief Executive Officer, who is going to provide an overview of recent business developments. The company's remarks today correspond with the press release issued before market open today and the Form 8-K that was filed this morning with the Securities and Exchange Commission concerning the business developments we will be discussing today. Before we begin, let me remind you that today's call will include forward-looking statements based on the company's current expectations. These statements reflect our judgment as of today only and are subject to risks and uncertainties that could cause actual results to differ materially from those described in these statements. We undertake no obligation to revise or update these forward-looking statements in light of new information or future events, except as required by law. For information concerning risk factors that could affect the company, please refer to the Risk Factors section included in the company's 2022 annual report on Form 10-K and in our quarterly reports on Form 10-Q filed with the Securities and Exchange Commission. With that, I will now turn over the line to Dan. Good morning. Thank you for joining the call this morning. On the call today, I will make a brief statement outlining the latest information we have from the FDA on the approval of Libervant. Once I have concluded my statement, I will open up the call for questions. I am pleased to say that yesterday we received confirmation from the FDA of the tentative approval of Libervant for the treatment of seizure clusters. This is the culmination of a tremendous effort by the Aquestive product development team. From the formulation of the product to conducting the clinical studies to working through the regulatory filing process, this has truly been a company-wide effort. I am proud of the team and proud of the accomplishment they have achieved. Unfortunately, the FDA has labeled our approval as tentative and indicated that they do not believe that we have sufficiently shown how Libervant is clinically superior to Valtoco, a competing diazepam nasal spray, which currently holds the orphan drug exclusivity. I will get into this in more detail in a minute. However, I first want to point out that gaining a decision from the FDA provides significant clarity to our business. We now have certainty of Libervant's market entry, and we have further validation of our ability to gain FDA approval of our pipeline programs. This is an important milestone as we look to rapidly bring AQST-109 forward to the FDA. Globally, we will continue to focus our energy and resources on AQST-109. As all of you know, severe allergic reactions, including anaphylaxis, is too big an indication for orphan drug exclusivity to be an issue. Regarding the FDA's decision, we respectfully but firmly disagree with their determination. Today, I want to walk you through just one element of our story that we believe the FDA failed to see from the patient perspective. As my medical experts tell me, a rescue drug must work quickly and be effective under a wide variety of conditions. For products like Libervant and Valtoco, where drug plasma concentrations are used to bridge to efficacy studies. This means that rapid and extensive absorption must be observed under all conditions, including whether a patient has had a meal recently or hasn't had a meal in hours. In the case of Libervant, we have known about differences in absorption due to food for some time. We have therefore been able to develop a dosing regimen that ensures patients get sufficient drug plasma concentrations no matter their fed state. This is why our label, approved yesterday, includes the statement can be taken without regard to food. For Valtoco, we have been very public for some time around our view that the FDA should require characterization of drug plasma concentrations with Valtoco under fed conditions. We even went so far as to submit a Citizen Petition back in 2019. The FDA disagreed with our view at the time and approved Valtoco without any food effect studies. Simply put, based on the data created by the Valtoco sponsor and reviewed by the FDA, no one knows what happens when a product is administered after a meal. Last year, in order to solidify our orphan drug case. We sponsored a clinical study that examined the difference in drug plasma concentrations over time when patients are administered Valtoco in a fed state compared to a fasted state. Based on the FDA's feedback to us, the expectation would be that there was little or no difference. The study results actually show that there is a significant difference between fasted and fed for Valtoco. In fact, as we outlined in our press release, the peak concentrations, or Cmax, dropped by 42%, and the time to peak concentrations, or Tmax, doubled from two hours to four hours. This means that during the critical early time periods where patients need rapid and extensive absorption, they are not always receiving the expected levels of diazepam after administration of Valtoco. We believe, especially for a rescue medication where time and speed matter, that this is a significant shortfall that patients deserve to know about and that sets Libervant apart from Valtoco. When you compare this data to the data we generated for Libervant in a cross-study comparison, there is a significant difference. While the agency's determination letter does not dispute the importance of this factor, it does dispute our cross-study comparison. According to the agency, because we did not include a Libervant film arm in the Valtoco food study, the data cannot be used to indicate whether there is a food effect for Valtoco. We find this counterintuitive to patient interests and contradictory to previous FDA practice. We plan on meeting with the FDA as quickly as possible to discuss their views and the data we have generated. If necessary, we will contemplate conducting a comparative study of Libervant and Valtoco in a fed state. This is too important an issue for patients for us to ignore. In the meantime, we will continue to bring AQST-109 forward. We are on track to report our EPIPHAST II study before the end of this quarter. We have already scheduled a meeting with the FDA for our End-of-Phase 2 review in Q4. We are happy to have obtained a tentative approval for Libervant, which gives certainty to market entry, and we will engage the agency with vigor to accelerate our ability to distribute Libervant in the United States. Operator, please open the line for questions. Thank you. As a reminder, to ask a question at this time, you will need to press star one one. Please stand by while we compile the Q&A roster. Our first question comes from Gary Nachman with BMO Capital Markets. Your line is now open. Hey, good morning. Dan, if you end up doing a comparative study with Valtoco on the food effect, how long would that take roughly to conduct, and what would be entailed? How big and how much would it cost? When do you think you can meet with FDA to discuss that potential plan? Sure. Gary, good morning. As you can appreciate, we're only a few hours from getting this notice from the FDA, so the planning process will start literally when this call ends. From a what-we-know-today perspective, performing a comparative food effect study of Libervant versus Valtoco is a very simple study to perform. It can be done in a very brief period of time, a matter of weeks or a couple of months. The part that we need to work through is we want to make sure that the FDA understands the protocol and understands what we will generate out of that study. That's where we'll focus immediately. In terms of the cost of the study, it is also not an overly expensive cost. I don't have a number for you, but it is not a large number. From our perspective, there is a rapid path forward, if we decide to conduct that study. Okay, that's helpful. If you have to end up waiting until Valtoco's orphan drug exclusivity expires, how long would that be? What's the earliest you could enter? Remind us of your Libervant patents, how far those go, and any new ones that could be issued in the next few years. Right. I want to be really clear on this point, and thank you for asking that question, Gary. We're not waiting to pursue full market access for Libervant. There is no scenario right now where we plan on doing nothing. We will pursue vigorously the data that we have, which we believe is very compelling, and we will continue to work with the FDA to accelerate our ability to have market access in the U.S. To give you a date, the current exclusivity on Valtoco expires in January of 2027. Our patents, I don't have the exact date with me, but go to the late 2030s. Okay, great. And then just the last question, you know, I guess with the launch timing of Libervant unclear, is it more or less likely you would look to partner that out? Do you think you need to have clarity in order for a partner maybe to license that asset? Or, you know, would it be better to share some of the development risk that's still associated with it with a partner? Thanks. Right. Well, let's start with the development dollars. Again, the development dollars are done. We have an approval, so there's no more development to be done on this program. The only dollars to be spent would be if we decide to do a comparative study for orphan drug usage, which we talked about before. In terms of how we think about the product, Libervant, I would say there are two important elements. One is we are big believers in the benefits of Libervant, and we believe it deserves to be in patients' hands. We will continue to look across the possibilities we have in front of us on how we get Libervant into patients' hands as quickly as possible. If that involves partnering, we will pursue that, of course. In terms of whether the partnering process is what we would start today, we haven't had that discussion yet. I think right now we're focused on getting to the full market access approval. Okay, great. Thanks for the additional color. Yeah. Thank you. Our next question comes from the line of Jason Butler with JMP Securities. Your line is now open. Hi. Thanks for taking the question. Can you guys hear me? Yes. All right. Thanks, Dan. Good morning, Dan. Just I guess quick follow-up to the last question. When you think about the cost of the commercial infrastructure you have in place today, you obviously made some adjustments already there, but any potential changes you would make to the current commercial infrastructure based on the news today? Right. Well, as I shared in the earnings call earlier this month, we are very focused on making sure our commercial footprint with Sympazan is cash flow positive. That network was ongoing before today and will continue after today. In terms of what to think about with our commercial footprint, I don't think you'll see us expand it with just Sympazan. Other than that, as of today, we'll continue to sell Sympazan with our commercial footprint. I would say that the product that we also believe belongs in the hands of patients, and whether it is us or someone else, we wanna make sure the patients have access to the product. Got it. Okay. If you ran a comparative study, can you give us any visibility into what the review process would be to get FDA to change its determination? Is this kind of like an NDA review? Would there be a fixed timeline, or is there any visibility into what that process would be? Yeah. I think you're gonna see us do a lot of things. I think you're going to see us be very vocal about the data that we have in the public domain. We have a variety of data we have not shared because we were waiting for the approval. We will now share that data, including with our competitors, so that they can react to it and understand it from their perspective as they look to put patients at the forefront of how they do business. In terms of the FDA, we would be looking for a rapid response from them. There is no timeline for an orphan drug exclusivity. However, I don't see how they could take the data we will have, especially with the public element of that data, and not respond. Great. Then just lastly, the food effect is one piece, but you've mentioned in the past there are other attributes of the product that you think support, you know, an important contribution to patient care. Are there still avenues that you can explore beyond the food effect to support final approval? There's a variety of pathways we could take and different arguments we could employ, including, obviously, taking legal action. However, as we sit here today, we believe the food effect data is just too compelling of an issue and an important issue for us to do anything other than prioritize that particular issue. I just wanna be clear that in the response we received from the FDA, nowhere in it did they say that they disagreed about the importance of the issue. They simply took issue with how we presented the data and stated they thought there was a better way for the data to be more meaningful to them. That's where we'll focus, and that's where we'll create a dialogue with the FDA. Great. Just last question from me. You said in the prepared comments that you're gonna continue to focus resources on AQST-109. Just wanted to see if the timelines there are still as you'd previously given, i.e., EPIPHAST II data this quarter and then an End-of-Phase 2 meeting by the end of the year. Yeah, Jason, and I appreciate you asking on AQST-109. AQST-109 is exactly on track. We are excited to release data later in the quarter once the data's ready. We have already reached out to the FDA to set up our End- of- Phase 2 meeting. They've granted us that meeting, so we'll have that meeting in Q4. We are, from my perspective, in a good place to continue to rapidly progress AQST-109 over the next few months. Great. Thanks for taking the questions. Thank you. Our next question comes from the line of James Molloy with Alliance Global Partners. Your line is now open. Hey, good morning. Thanks for taking my questions. Could you walk me through again, Dan, what was the timeline sort of start to finish for the Valtoco food effect trial you guys ran previously that you submitted the data on? Any risk if you run a Libervant comp arm of a food effect with Libervant as well? Yeah. James, you were a little muffled, but I think what you asked was if I could walk through again the timeline of doing the comparative study, and then on the second question was, is there any risk for Libervant in that study? Is that? Did I get that right? Yes, that's correct. Okay. The timeline for actually running the study is very quick. You're talking about a matter of weeks or a couple of months, worst case. The time that I don't have an answer for today is the engagement with the FDA, because we wanna make sure that there is very clear understanding between us and the agency before we start that study. We will rapidly reach out to the FDA, so the time on our side will be brief. I think it's just a matter of how much back and forth there is. I would say that's the wiggle factor, I'll call it, in the timeline. In terms of risk to Libervant, I also wanna be really clear on that point. We have run multiple studies with our product in healthy volunteers and in patients in a fed state. We have characterized our food effect thoroughly. We understand it, we know how our product will perform, and we know that patients will rapidly receive absorption with our product that gets to levels that when you look in the literature suggests you have entered the therapeutic window. The study we ran with Valtoco tells a very different story. We do not see risk with Libervant in that study whatsoever. Great. Thank you for taking the questions. Thank you, sir. Thank you. Our next question comes from the line of Thomas Flaten with Lake Street Capital Markets. Your line is open. Good morning, Dan. Thanks for taking the question. Just out of curiosity, there was a number of components of the MC to PC argument that you guys were making. I'm curious what FDA's feedback was on, for example, ease of use and consistency of administration, et cetera, 'cause we focused a lot of this call on the food or on the fed state argument. Yeah. Yeah. Now in some cases, the FDA gave us very thorough response on certain elements. In other cases, they simply said that they disagree. Depending on the element, we either have thorough answers or we have spots where we're not even sure what the thought process or rationale was that went into the response. In our correspondence to some degree, we will ask for clarification on some of those other items, to your point. We will continue to believe as we go forward at this point, that we have a spot that is very compelling and that's with the food effect and that's where our focus will be. What are the odds of FDA disagreeing with your approach and rejecting that plan to move forward, do you think? Or is it such an easy setup that they can't really say no? Well, let me rephrase it. They can't stop us from running the study, right? They can say we don't know if it would be compelling or we're concerned about whatever they come up with. We have every right to run a study showing what the drug plasma concentrations of our product versus a product in the market look like at time points for a rescue medication. Beyond talking with the FDA, we will be very public about that data as well and make sure that we publish for the industry and the community the findings that we have. just one final one from me. Assuming you have a successful meeting with FDA on 109 in the fourth quarter, can you lay out maybe a kind of a base case scenario for initiating a pivotal and, you know, time to completion, et cetera? Yeah. No, thank you, Thomas. Right now, based on our internal timeline and the End- of- Phase 2 meeting being in Q4, our goal is to file by the end of next year. The pivotal study, we would like to start it as soon as possible after the End- of- Phase 2 meeting. As I think I shared with you before, it's actually not the critical path in terms of time. Whether we start the pivotal study in December or January or even February, there's plenty of time to complete it before our filing. The critical path or the timeline that we will keep an eye on is the registration batches which need 12 months of stability. That's the piece we'll be waiting for in order to file with Q4. Excellent. Thanks, Dan. Thank you. Shannon, are there any other questions at this time? Shannon, can you hear me? I'm sorry. I've just joined the call. Currently showing we have a question from Raghuram Selvaraju with H.C. Wainwright. Your line is open. Thanks very much for taking my questions. Can you hear me? Yes, we can hear you just fine, Ram. Okay. Firstly, I wanted to unpack a little bit more what you were saying regarding the FDA not being in disagreement with your delineation of the fence asset issue. If they are not in disagreement, did they ever provide you with any overt indication that they agree with you? Their comments are focused on the data that we supplied them and why they believe that data doesn't give them enough information to change their decision. In my view, the mere fact that they're talking about the data and what is necessary to change their decision leads to because it's a really important issue. Nowhere in their text do they say, "Even if you had given us definitive information, we don't think this is important." I would think it would be my personal opinion, I think it would be very hard to argue that a change in drug plasma concentrations related to a condition such as food is not important in a rescue study. Okay. Would it be accurate to say that the FDA has not given you an indication that if you were to provide them with data on this point in the manner that they want, that would be satisfactory enough for them to at least reconsider the situation, as opposed to them saying, "Well, actually, you know, we would prefer it now that you've done this, that you actually run a head-to-head comparative efficacy trial." I understand that this is inviting you to conjecture, but I think it would be helpful to get some sense, subjectively even, of, you know, where you think the FDA's head is at. Sure. I believe you're just asking for opinion, right? Because I'm sure, Ram, as you know, the FDA did not in their letter, and I don't know that they have in any letter I've ever seen, say, "If you do this, we will do that." Right? It's just not how they. Of course. how they operate. Right. I believe that they understand the importance that absorption plays, especially in a 505(b)(2), where you're doing bridging to efficacy studies, the importance that concentrations play in how you look at a drug. In fact, if you remember, we received a CRL back in September of, I believe it was 2020. I might have my year wrong, but when we received our CRL. In that CRL, the FDA, the same review group that will look at the study we're gonna run, put a sentence saying, "We would be concerned about any change in efficacy that could occur related to changes in drug plasma concentration." That's me paraphrasing. That's not their precise words. I believe they understand the importance, and I believe they will, being the good stewards that they are, fairly review the data that we create when we have submitted it to them. Okay. Let's move to a separate issue. I wanted to ask your views on two levels relating to this. The separate issue is, of course, Neurelis and Valtoco. First wanted to clarify, you know, our understanding is that Valtoco is not performing particularly impressively on a commercial basis. If you can give us some sense of, you know, to what extent you're aware of Valtoco's commercial traction, if any. You know, if you can kind of describe what the situation currently is commercially for that product, and if that potentially has any implications for the extent to which or the lengths to which Neurelis might go to try to defend the product. Second, let us assume that the fed/fasted issue is satisfactorily addressed with the next study that you run, and further, that the FDA agrees with the data that is in that study as being supportive of the rationale for formally approving Libervant. Can you speculate on what reaction Neurelis might have? Would they attempt then to try to fight a so-called rearguard action with the FDA and still attempt to deter Libervant from getting to the market using legal recourse? You know, again, this is an invitation to speculation, but just wanted to get a sense from you of, you know, what those potential scenarios look like. Thanks, Ram. Let's start on the commercial side. We haven't focused or put a lot of effort behind exactly what Valtoco is doing or isn't doing. We have looked at the overall market. If you look at the three products in the market, the diazepam rectal gel, Valtoco and Nayzilam, which is a different benzodiazepine, as I know you know, Ram. Those three products are expanding the market over time. We do believe that some of the patients who have just stayed out of the market are coming in. We've been surprised at how much the diazepam rectal gel has continued to be a major component of the marketplace. We believe that just speaks to the continued unmet need. We would also point out that there continues to be, from our view, a large population that should be carrying a rescue product that is not. We think that an additional product such as ours, with the benefit our product has, would help those patients. We're excited to get through this time so that we can actually put this product in the hands of patients. I don't know that I would have any other view on how Valtoco is doing or not doing in the marketplace. In terms of a competitor's reaction to our news today or news in the future, I would simply say I understand it's a competitive industry. I understand that competitors will work to protect their positions. I don't know how that would work with the owners of Valtoco, but I guess we'll all find out as we go through this. Okay, just lastly, a very quick one with respect to Sympazan. Just wanted to clarify that with respect to the current sales and marketing infrastructure that you have in support of that product, that you still feel confident that you can continue to generate growth and maintain the growth trajectory, indeed even accelerate it into the months and quarters ahead. Well, let me put it this way. There's several factors to focus on in when we need to consider Sympazan, right? One is there is a patient population that is using Sympazan today, and it's a severely challenged patient population. We will not take a position where they don't have access to Sympazan. Whether it's us or someone else, we will make sure that Sympazan is available to the patients who are using it today, tomorrow, and for some time to come. In terms of how we look at Sympazan, its growth trajectory, how it fits in our company, the statements I made in the earnings call remain true today. We're focused on getting to profitability. How far and how much growth we can generate from where we are today to ultimately the peak sales of Sympazan, I think is something we have to continue to analyze and figure out where that spot is. Thank you. Thanks, Ram. Thank you. I'm currently showing no further questions at this time. I'd like to hand the call back over to Dan Barber for closing remarks. Thank you, Shannon. I appreciate everyone's time today. This obviously, from our perspective, is an important step forward for Libervant and for the company. We are focused on interacting with the FDA as rapidly as possible to continue the dialogue on how to accelerate market access for Libervant. We will also continue to focus on AQST- 109, and we look forward to talking to you soon with the data from our EPIPHAST II study. With that, I will close the call today. Thank you very much. Thank you. This concludes today's conference call. Thank you for participating. You may now disconnect.