All right. We're gonna go ahead and get started here. Good morning. Welcome to the Citizens Life Sciences Conference. Great to have you all down here in Miami with us. Super excited to start the day off with Aquestive. Aquestive obviously developing Anaphylm for serious allergic reactions and anaphylaxis. A lot of recent news flow, we have a lot to talk about. I'll introduce Daniel Barber, CEO, and Dan, you know, do you wanna introduce the team and yourself? Give maybe a quick 30-second overview? Sure, happy to. First, Jason, thank you for having us. Thank you to the team at Citizens for giving us the opportunity to present today. Always enjoy the conversation. I'm joined today by two very esteemed colleagues of mine, Matthew Greenhawt, who is our Chief Medical Officer, who just joined us. Matt is a practicing allergist who has decades of experience. We're very thankful to have, especially as we talk about Anaphylm and where that's taking us, we're very thankful to have his expertise as part of the team. Also Ernie Toth, our CFO. Looking forward to the conversation today. Great. Let's generally start right with the meat of the conversation. Obviously, you got some news a few weeks ago that we, you know, we weren't hoping for, this, the CRL for Anaphylm, but the positive is it seemed to be extremely clear. Full credit to you guys for being, I think, extremely transparent. Mm-hmm About what was in the CRL, but maybe can you just walk us through what the key questions that FDA has remaining and what the next steps are? Sure, yeah. Look, transparency's hard, right? As a company, we had a review process that was going on with the FDA that felt very good from a clinical perspective. We felt like the clinical review team really understood our drug, understood what we were trying to do, and then as the FDA sometimes does for a variety of reasons, they're good people trying to do good work, but they've got their own way of doing things. In the December and January timeframe, we had a lack of communication. What you're referring to obviously is the note we put out at the beginning of January saying, "We don't have a label, and the FDA is not communicating with us." We felt a responsibility to tell people that's where we were. Fast-forward a few weeks later, and it was a very odd set of emotions when we got the CRL, because on one hand, it's a CRL. A CRL is heartbreaking. It means more time, it means more work. On the other hand, the things that we thought we had done well, we had confirmation in the CRL, and as all of you know, a CRL stands for Complete Response Letter, so it means the FDA's complete review of the NDA. We were very pleased to see that some of the heavier, harder clinical discussion items were in a great place, and there were no deficiencies. To your question, the CRL did contain a series of items around what are called human factors, which is really the handling and administration of the product, that the group in the FDA that handles these things, called DMEPA, had pointed to as things they wanted to see more work on. Last thing I'll say before turning it back to you, the DMEPA group, we did not have the ability during the review process to interact with them the way we would've liked. We actually had information ready, discussion points ready for anything they might have said, and unfortunately, because they used the CRL process to inform us of their views, we never had the opportunity to have that discussion. I think another point that's really important here is that FDA's asked you to do several things, and your answer has been yes. That's right. You know, you're not. There's no debate here really with FDA. There's maybe some defining or fine-tuning of the details. Right. You basically have not come back and said, "We don't agree with this," or, "We don't agree with this." You said, "Okay, the FDA's asked us to do these things. We're gonna go do them. Right. Yeah. Yeah. I guess the nuance I might put in there is I don't know that we necessarily agree that a CRL was necessary for some of these things, but we believe in our product, we believe it will help people, we believe it will save lives, and we wanna bring it to the market, and the best, fastest way to do that is to work with the FDA, not fight the FDA. Right. all of the things they want us to do are very clear. They're things we can do, and so we are, as quickly as we can, going through that process. Before we kinda jump into the details of what that is, that last piece here is. I'll pull in the money piece too. The time and investment to get those answers is pretty efficient, right? It is. You said you're gonna be able to resubmit the NDA in the third quarter. That's correct. Just again reinforce that point that, you know, this is a. Not only is it clear, it's fast and it's not, you know, burdensome from a financial perspective. Yeah. There's two studies we have to perform. One is rerun our human factors validation study. A human factors validation study is. There's participants, you're giving placebo, so you're not giving drug. There's no labs you have to do associated with the individuals. So it can be done in a very short window at a very efficient price. The other study we'll have to do is one more PK study, and as you know, one, we're very good at PK studies, and two, they're very cost efficient. Okay. Maybe let's take a slightly different path before we talk about all of the details here. The unmet need, and you know, you mentioned Matt is here. It kinda seems obvious that, you know, epinephrine works for anaphylaxis, and there are patients out there that don't love the idea of injecting, right? Can we just maybe talk at a high level about how physicians think about the need for needle-free epinephrine products? Yeah. No, thank you. It's a great question. It's something that with every patient interaction is on my mind. Yeah. I mean, so you back up. Why do patients run into problems with anaphylaxis? Because they don't use the medication that we prescribe, and it's for two reasons. Either they don't like the form that it comes in, and/or they haven't carried it with them, which sometimes those are sort of very nested within one another. You know, patients need to carry something. They need to feel confident in using it, and when they don't, you know, that's where they run into trouble. You know, we've survived for decades now using sort of these forms of auto-injectors or just sort of a simple needle and syringe. Yes, they work, but, you know, that begs the question, can we optimize that? Can we make it easier for patients to carry? Can we entice them with something more fitting their preference so that they'll actually use it? Because you're right, it works incredibly well. You know, for some of the misadventure that we get into in our office, food challenges, things like that, you know, it's remarkably forgiving so that, you know, we can do these procedures and sort of make these diagnoses. When you have somebody in the community, you know, you really have to trust that they are armed and carrying what they are supposed to. That's sometimes what keeps me up at night in terms of, you know, are you going to be prepared? Are you gonna do what we We spend a considerable amount of time in the office visit doing that. You know, having something that, you know, could fit behind your phone, it's on you, it's or it goes in your mouth. You know, this is really just sort of aligning with, I think, everything that I've observed in my patient population. There's clear data out there, right, showing that patients do delay using the products. There's also data out there showing that there's a lot of patients that should carry a rescue medication but don't. Can you kinda maybe tie that into the real world? How often do you see that in clinical practice? How you know, you and your peers, you know, to what extent are those the real-life challenges that you're dealing with? Yeah. I'm challenged to remember a day in the clinical setting where somebody came in and said, "Yeah, I had this accidental exposure, and, you know, I know I should have had my whatever with me, and I didn't use it." It's common, the delay anywhere from like 8 to 12 minutes, depends on the study, the setting. So there are other scenarios where, you know, you have parents that sit and literally debate in the parking lot, "Am I gonna give an antihistamine? Am I gonna give the auto-injector?" You know, on average, like something like 36% in the pre-hospital setting do not receive epinephrine before they come in. All these things delay, and they sort of increase the risk of morbidity. You know, length of stay, sort of prolonged observation in the emergency room, need for additional doses of epinephrine, additional medications. You know, it's preventable, but the challenge is finding a way to meet the preference of the patients so that they'll do what's, you know. On paper, it's a very easy solution. Use whatever form. You know, there's been this inertia for a long time, and you know, it's something that we can improve upon in clinical medicine. Great. Dan, maybe we can jump into the weeds now a little bit on the study. Walk us through the questions FDA is looking to have answered and what the human factors study is gonna, you know, basically be assessing. Sure. Yeah. If you look at the CRL, and we obviously have shared this CRL with everyone, the human factors group points to a couple of things—well, three things specifically. One, they felt that the package was too difficult to open or they were concerned about in a crisis situation, would people be able to open the package? Two, they noted that in our study, we had 166 people in our human factors validation study, that 19 people put the film on top of their tongue instead of under their tongue. Three, they pointed to this idea. They kind of generally put it in this bucket of tolerability, but I interpret it more around will people administer the film, will they keep the film in their mouth? If we just go through how have we tackled those, right? The first on the packaging side, really simple. Our child-resistant packaging, which we've used with Suboxone for 16 years, you fold the film, the film pouch at the top, and then you tear. We got rid of the fold. Now you just tear. It does make it simpler. We believe on the opening that we've done what the FDA needs to feel comfortable. In terms of putting the film under the tongue instead of on top of the tongue, we have, and I'll for those who are listening, I'm pulling out my phone and showing the pouch. We've put a picture of where to put the film on our pouch, which before there was no picture. Simple things like that really can improve. That's what human factors is all about. How do you just make it simple so that people can, in a crisis situation in particular, follow what's going on? Now, when you get to this concept of administration and tolerability, from our perspective, there were four individuals who the FDA noted removed the film at some level, which is actually hard to do because the film turns into a gel right away. I've watched the video on all four of those individuals. We think there, in all four of those cases, if they had an instruction on the film that literally said, "Don't remove the film," we think that would have sufficed. In fact, one of the individuals unprompted said, "Well, I took it out because I don't like the mint flavor, but if I had a reaction, I would've kept the film in." We think these are, as we talked about before, we think these are very solvable. Mm-hmm Issues that we've already have the answers for. Now we'll take that work, go redo our human factors validation study, and then show the improvement. It, a lot of it, I don't wanna oversimplify, but a lot of it seems, like, very straightforward. Like, you've made the package easier to open. Right. You've made the instructions even more obvious to use. We could sit here and have a debate about, like, you know, who are the people that actually struggle with these things. Right. Leaving that alone, how do we measure success in this human factors study? Because look, it seems really straightforward that you've made the instructions even more user-friendly. Yep. Is there a number of participants that the FDA wants to see able to use this? Is a failure rate the FDA wants to see? Or how do we measure the you know, did you do enough to- Right satisfy FDA? That's the right question. A little trickier than any of us would like. The DMEPA group at FDA, it is a qualitative assessment. There's no bright line of if you hit X% that you're good. Which obviously on the clinical side, there's endpoints that are measured, and you can really get at that. When we look across the medical devices that have been approved, and every product has errors, right? People are people. It would appear that DMEPA in general seems to, especially around rescue products, keep a threshold of around 90%. Let's go back to the data we got and what the FDA put in our CRL. If you look at 19 people putting the film on top of their tongue out of 166, it's over 10%. We think by showing our instructions improve people's ability to put it under their tongue and lower that number, that will get the FDA comfortable. There's an important, like, detail there as well. There were a number of those patients that didn't read the instructions in the first place, right? Telling the patients in the study, "You have to read the instructions," just itself should improve that success rate. That's right. The part of the way these studies are run, sometimes you give people the Instructions for Use, which is the paper that comes with your drug, right? Sometimes you just give them the actual package. By putting more instructions on the package, you can make sure they read what they're supposed to do and follow it. Got it. As much as we said everything here is clear, you're doing, I think, what you should do and taking the opportunity to meet with FDA and really confirm that. You have a Type A meeting that you've requested. Hopefully, that'll happen in the next few weeks. Just walk us through the details that you're looking to really dial in on. We haven't talked about the PK trial. That'll be part of this as well. Yep. Yeah. I think a really important thing to understand with our Type A meeting is it's not slowing us down. Mm-hmm. It's almost a formality we're following while in the background we're getting ready for. Our CROs are in place. Our protocols are in place. We have our dosing dates, so we're doing all the background work to get ready for those dosing dates, and the Type A meeting process is not slowing any of that down. The questions we're asking are very basic. We're asking, "Hey, are you good with the protocols we're going to use?" And especially with the PK study, we know the process really well. We would expect it to be a pretty easy conversation. Then the second question. There is one arm in the PK study that we're happy to do. It's currently in our protocol. It's currently in our dosing plan. We don't understand the need for it, I guess, is the way to put it, and that's around the chewing. Mm-hmm. Because the film, if you think about how the film works, the film dissolves in the oral cavity however or wherever it dissolves, and if you swallow it ends up in the same place. The difference between it dissolving on the top of your tongue and you chewing it and then it dissolving and you swallowing it, we don't believe leads to different results. We are saying to the FDA, "Do you really need that?" If they say yes, we'll do it. If they say we don't, then we'll take it out. It may be the same question there around the PK trial then and defining success. You know, in some ways, FDA's asking you to characterize the product being used not appropriately. That's right. An obvious question there is it okay then if you don't use the product properly that the data don't look as good? That's right. Yep. No. Jason, as usual, you have the points perfectly correct. The on top of tongue data that we will create for the FDA will be different than our self-admin, our clinician admin, and our IM comparator because we know it is. We've already done it. It is an off-label way to give the product, so we believe it is informative. It is not an approvability issue. We believe the FDA is looking to just characterize that. Mm-hmm I think the important one for people to keep an eye on is the self-administration arm, where people are using the new Instructions for Use because that's where the FDA gets to really compare our product versus how a clinician gives the product. Got it. You've obviously done a tremendous amount of work leading up until the beginning of this year on getting ready to launch the product. Mm-hmm. You now have some more time to continue to refine that. Has your thoughts changed in any way? Maybe let me ask, you know, there's a competitor out there, an approved nasal spray product. Really? Can you talk a little bit about that and how that's, you know, influencing your go-to-market strategy? Sure. Yeah. Well first, let's just talk about the market. The market's growing robustly. If you look at the fourth quarter, just the auto-injector market grew by 5%. There is a branded nasal spray competitor that has put a lot of money into DTC, and like DTC tends to do, it broadens the whole market. It has been interesting to see that the number of auto-injector growth scripts in Q4 was almost equal to the total number of nasal spray scripts. Mm-hmm. We like that dynamic, that market continues to be healthy and grow, and that 90% of it is still auto-injector. In terms of how we continue to prepare for launch. One of the biggest things we've done is focus on medical affairs in a way that we hadn't before. With Matt joining us, we have someone who really understands the allergy community in a way that is very deep. We have invested in more MSLs, where our publication and conference presence is going to be much greater this year. We think that will really help prepare allergists for our technology. In terms of how we launch, we do see the nasal spray's having some success, right? Which is good. We do believe that having a wider sales force, so increasing from 50 to 75 is important, and that will allow us to not only cover more, physicians, but we'll have more frequency at those physicians. I think you're seeing a really healthy, competitive dynamic in this market space that should ultimately help patients. Let me tie this back into, you know, some of Matt's comments from before. If there's such an obvious need and there are so many patients that are, you know, should be taking a needle-free alternative, why has the Neffy launch not gone maybe as well as investors had hoped for? Is it a little bit, you know, investors got out of their skis, or what's taking so long to build this needle-free market? I try to let the competitor speak for their results and how they feel about how they've done. What I can do though is give you some broad thoughts about our learnings. One is that the allergy community is absolutely fundamental to your launch, making sure that the community understands you, that the community trusts you, that the community wants you to be a part of the solution. We're spending a lot of energy and time, and I know Matt feels. I'll let him speak for how he feels about that. That's really important. The second thing is the. I'll call it the kinetic value of your product. How much do people really want the incremental improvement you're bringing? The nasal spray product is a good product. Moving from an auto-injector to a nasal spray, helpful, will help patients. We believe our product has a value from an auto-injector to a film that is different and in my view, more compelling. I think that also provides a more incentive for people to want to have it. Then third, where we both of us and our competitor both have to face the same reality, the payers are tough. Yep. Making sure you spend the right time with the payers up front is the work we're doing right now. Got it. Let me ask Matt, you know, you're a few weeks into the role now. Obviously, you know, the drive to join the company, you know, seems clear for you. But can you maybe walk us through what your, you know, initial thoughts and ideas are about how the company can get ready for this launch in, you know, over the next several months now? Yeah. I think as a medical affairs team, we need to be out there front and center, which means all the major meetings, not just allergy, but some of the other potential sort of prescribers, pediatricians, advanced practice providers, or a number of people who prescribe. The allergy community is foremost, so being at the major meetings, as well as making sure that the data that we have from some of these past studies are out there. You know, I'm gonna probably spend most of the spring and summer writing up probably 10 papers or so. It's a good story to share. It's very, very easily relatable and I think this is how we can reassure prescribers and potential users that this is a good product that's not only going to take away what is often the biggest fear of an injection, but you know this is going to work just as well, which you know I think unfortunately the competitor is bearing a little bit of the brunt of some doubt. I don't think it's a founded doubt. I think you know it the product works very well. But you know being the first one to market in that space I think you know they're gonna have a little bit of a rougher run with certain things. You know there's a lot of excitement for the needle-free space. There was just a huge conference two weeks ago in Philadelphia. You know, people came up to our booth. People came up to their booth. I mean, people are seeing the change, that there's a different way of doing things, and it's just sort of getting the message out and that's what we can do in medical affairs. Great. About a minute left. If there's any questions from the audience, let me know. I don't wanna let Ernie get away with not saying anything, so I will ask the cash question. We said before that, you know, the response to the CRL is a fairly capital efficient response. Just walk us through where you are from a cash position, where you think about not only just, you know, getting through to approval now, but that launch prep and the transactions that you've put in place to make sure you're adequately or well-funded for the launch. Sure. Look, the company is probably better capitalized than it's ever been, with the capital raise that we did in August with RTW as a lead, and then the revenue interest financing agreement that provides launch capital, upon approval. As we announced last week, we ended the year with $120 million of cash. We did extend the RTW agreement now through June thirtieth, 2027, so we feel confident that that financing will be available to us. We have certainly enough cash to get through this year to support all the things that Matt just talked about from a medical perspective, all the work that Sherry Korczynski is doing to prepare for a commercial launch. We'll end this year with $70 million of cash, and that does not include any of the additional capital from RTW. Any out-licensing deals and remember, we still own all the rights to Anaphylm, and we have this other product Libervant that comes off ODE next year that possibly could be out-licensed. We feel good about where we're at and being prepared for a launch. Great. Well, Dan, Matt, Ernie, really appreciate you being here this morning and looking forward to, you know, another exciting year. Thanks, Jason. Thank you. Thank you, my friend.