Thank you for standing by. Welcome to Ligand third quarter 2025 earnings call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question-and-answer session. If you would like to ask a question during this time, simply press the star followed by the number one on your telephone keypad. If you would like to withdraw your question, please press the star one again. Thank you. I would now like to turn the conference over to Melanie Herman. Please go ahead. Good morning, everyone, and welcome to Ligand's third quarter 2025 earnings call. During the call today, we will review the financial results we released earlier today and provide commentary on our partner pipeline and business development activity, followed by a question-and-answer session. Before we get started, I would like to point out that we will be discussing non-GAAP results, which exclude certain items such as stock-based compensation, amortization of intangible assets, amortization or impairment of financial assets, losses from derivative assets, and gain from the sale of the Pelthos business, amongst others. I encourage you to review the reconciliation of these non-GAAP measures to their most directly comparable GAAP measures, which can be found in today's release available on our website. We believe these adjusted measures provide valuable insight into our core operating performance, both historically and moving forward. Our earnings release and a link to today's webcast can be found in the investor relations section of our website at ligand.com. With me on the call today are CEO Todd Davis, Chief Financial Officer Tavo Espinoza, and Vice President of Strategic Planning and Investment Analytics Lauren Hay. This call is being recorded, and the audio portion will be archived in the investor section of our website. On today's call, we will make forward-looking statements regarding our financial results and other matters related to the company's business. Please refer to the safe harbor statement related to these forward-looking statements, which are subject to risks and uncertainties. We remind you that actual events or results may differ materially from those projected or discussed, and that all forward-looking statements are based upon current available information. Ligand assumes no obligation to update these statements. To better understand the risks and uncertainties that could cause actual results to differ, we refer you to the documents that Ligand filed with the Securities and Exchange Commission, or SEC, that can be found on Ligand's website at ligand.com or on the SEC's website at sec.gov. With that, I will now turn the call over to Todd. Thank you, Melanie, and good morning, everyone. Thank you for joining us today to discuss another exciting quarter for Ligand. This quarter was pivotal. Not only did we deliver another quarter of exceptional financial results, we also successfully completed a convertible debt financing, providing us with additional flexibility to pursue strategic opportunities that support our growth initiatives. We are raising our full-year guidance for the second time this year. This increase in guidance is a result of the strength of our commercial royalty portfolio, which has continued to outperform our expectations due to products like Merck's Ohtuvayre and CAPVAXIVE, as well as Travere's FILSPARI. Additionally, I'm proud of our deal team's ability to create superior risk-adjusted returns through transactions such as the strategic merger of Pelthos with Channel Therapeutics that has driven substantial value creation for our shareholders. When we restructured Ligand in 2022 with the spinout of our antibody operations, we set a new strategic direction for Ligand, one grounded in focus and discipline. Since then, we've stayed true to that plan, scaling our deal team to accelerate growth in the late-stage pipeline and build a diversified portfolio of high-margin royalties designed to deliver superior returns. The strategy has played out exactly as envisioned, and I couldn't be more pleased with the progress we've made over the past few years. Royalty revenue grew 47% over the same quarter last year, and adjusted EPS increased 68%, reflecting strong performance across our portfolio. Key drivers contributing to the 47% growth in our royalty portfolio include the commercial launch of ZELSUVMI, strong launch of Merck's Ohtuvayre and CAPVAXIVE, growth of Recordati's Qarziba, and the continued ramp-up of FILSPARI. We ended the quarter with a strong balance sheet, including approximately $1 billion in deployable capital, factoring in our undrawn credit facility, which will allow us to take advantage of our robust business development pipeline. There's been strong uptake of ZELSUVMI in the early launch phase, and we look forward to the continued momentum. The launch of ZELSUVMI is an exciting milestone for patients with molluscum, who now have an at-home treatment option for this burdensome skin infection. We encourage our investors to listen in on the Pelthos earnings call, which will occur on November 13th. We expect a robust update on the launch performance. Our deal team has been busy this quarter, committing $35 million to Orchestra BioMed for royalty interest in their AVIM therapy and Virtue SAB. Ligand has also invested an additional $5 million. To help catalyze their equity private placement, which successfully completed a total raise of $111 million, including participation by AVIM partner Medtronic. We also committed $11 million to Arecor, in exchange for royalty rights to AT220 and milestone and technology access fees for AT292, Sanofi's Efdoralprin alfa program. We are pleased to report that just one month after our investment, Sanofi announced positive phase II results from its trial, demonstrating all primary and key secondary endpoints were met in adults with alpha-1 antitrypsin deficiency emphysema, a rare disease. Since restructuring in 2022, we've been executing on our current strategy and have seen significant growth across the core revenue, as well as adjusted EPS. I'd like to point out that in 2024, there were four FDA approvals of assets in our pipeline: Merck's CAPVAXIVE, Merck's Ohtuvayre, Pelthos' ZELSUVMI, and the full approval of Travere's FILSPARI. With these four products all in early stages of their launch, with the potential for both indication expansion as well as geographic expansion, we expect this growth to continue in the coming years. I would like to look ahead now to 2029 and discuss our five-year royalty receipts outlook, which we first presented at our investor day in December of 2024. We believe our long-term royalty growth is on pace to meet or exceed the 22% compound annual growth rate we outlined at that time. The existing portfolio alone supports a royalty receipts CAGR of 18%. Future investments should add at least 4% to this, with potential upside on top of the current outlook. The strength of our existing portfolio is evident across both our commercial and development stage programs. However, we believe that what truly differentiates Ligand as a royalty aggregator is the expertise of our deal team in sourcing and executing high-quality investment opportunities and the ability to drive superior returns with our operating capabilities and our special situations initiatives. It is through the strength of this team that growth across the future investment segment of this chart has the potential to surpass expectations. Turning to the next slide, I'll highlight a few positive developments since our long-term outlook was presented last December. Each of which has the potential to meaningfully enhance our long-term royalty projections. First. Ohtuvayre is tracking well ahead of the initial forecast and continues to be the strongest launch in COPD history. Q3 sales grew 32% sequentially, and consensus forecasts now project $2 billion in sales by 2029, up from $1.2 billion previously. As a 3% royalty holder, Ligand stands to benefit materially from this upside. Second, FILSPARI continues to perform well commercially in IgA nephropathy, with Q3 sales growing 26% over the prior quarter. Additionally, there is potential upside if approved in FSGS. If approved, the FSGS indication could significantly expand FILSPARI's market opportunity, potentially north of $1 billion. In FSGS alone, according to sell-side analysts. Turning to one of our development stage programs, let's look at Palvella's QTORIN rapamycin programs. We'll hear updates on their phase II program in cutaneous venous malformations in the fourth quarter and their phase III program in microcystic lymphatic malformations in the first quarter of 2026. Analysts expect peak sales from these two indications could be $1 billion. In 2025, we continue to execute our strategy of partnering with life sciences companies to provide innovative, non-dilutive capital solutions. Since the beginning of the year, we've closed five new investments, including the final Ohtuvayre inventor monetization, Castle Creek, Orchestra BioMed, the merger of Pelthos Therapeutics with Channel Therapeutics, and our most recent investment in Arecor. These transactions reflect the unique flexibility of our investment strategy and are well-diversified across our investment tactics, including royalty monetization, project financing, and special situations. Our investment to fund Castle Creek's phase III clinical study of DFI in patients with dystrophic epidermolysis bullosa is an exciting opportunity to advance an orphan drug-designated gene-modified cell therapy for a serious unmet clinical need. This collaboration reflects our commitment to invest in groundbreaking de-risked treatments that have the potential to transform patients' lives and also strengthens our late-stage portfolio. Our partnership with Orchestra BioMed also expands our pipeline of development stage partnerships, with potential royalties on two late-stage partnered cardiology programs. Orchestra's AVIM therapy, partnered with Medtronic, and Virtue SAB has received FDA breakthrough device designations, and the products target high-risk patient populations with hypertension and arterial disease, two significant global health challenges. Next slide. We have seen record-setting origination activity this year, reviewing more than 130 investment opportunities through the first three quarters of the year. We remain disciplined in our approach, prioritizing investments that offer compelling return potential and strategic alignment, while deprioritizing those that do not meet our long-term objectives. At present, we have approximately 32 active investment opportunities under review, representing a mix of accretive and pre-approval transactions. I'd like to take this opportunity to remind everyone of our upcoming investor day, which will be held on December 9th in New York at the Harvard Club. The registration link can be found on our website. We'll be evaluating consensus updates and commercial progress, as well as clinical progress of our assets in our farm team, to share a refreshed view of this long-term outlook with you at that time, and we hope you can join us. I'll turn it over now to Lauren for a portfolio update. Thank you, Todd. Turning to a portfolio review, I'd like to provide some important updates on Ligand's key portfolio assets. I will go into more details on Merck's Ohtuvayre, Travere's FILSPARI, and Palvella's QTORIN rapamycin programs on the subsequent slides, but I'd like to briefly discuss updates on two of our key pipeline assets: Sanofi's Tzield and Agenus' BOT/BAL. In October, the FDA nominated Tzield as one of nine products selected for the prestigious new Commissioner's National Priority Voucher. These vouchers are designed to recognize and reward products with significant potential to address major national priorities, such as meeting a large unmet medical need, reducing downstream healthcare utilization, or addressing a public health crisis. This overlaps perfectly with Ligand's mission, delivering high clinical value to patients impacted by serious disease. The new Commissioner's Voucher Program aims to shorten the standard 10-12 month FDA review timeline to just one to two months, which is remarkable. While we have heard concerns surrounding volatility at FDA, to date, we have not seen any impact in terms of delays or other issues related to our key portfolio assets. In addition, we have seen a new willingness by the agency to accelerate timelines and provide incentives that spur real innovation. We believe this new FDA orientation is forward-thinking and very good for patients. As a result of receiving the Commissioner's Voucher, the supplemental BLA for Tzield in individuals eight years and older who have been recently diagnosed with stage three type 1 diabetes was accepted in October and will be reviewed expeditiously, which is welcome news for patients and their families. We are excited about Tzield's recent recognition and the potential for a significantly expanded indication in the near term. We congratulate our partner, Sanofi, on this exceptional accomplishment. Additionally, our partner, Agenus, plans to initiate a streamlined two-armed phase III trial of BOT/BAL in patients with refractory, non-liver metastatic, microsatellite-stable colorectal cancer in the fourth quarter of 2025. The phase II data are highly encouraging, demonstrating deep and durable responses in this difficult-to-treat population, underscoring the meaningful benefit observed in patients who have failed standard therapies. Next, turning to Travere's FILSPARI, in August, the REMS liver monitoring requirement was relaxed from monthly to quarterly for IgA patients during the first year of treatment. FILSPARI is becoming firmly entrenched as a foundational treatment for people living with IgA nephropathy, and the approval of these streamlined monitoring requirements reflects the strong safety profile of FILSPARI, simplifying treatment initiation for patients. In Japan, our partner, Renalys Pharma, completed primary endpoint data collection in its phase III IgAN trial, and topline results are expected in the fourth quarter of this year. In October, Chugai Pharmaceutical announced plans to acquire Renalys. Chugai is recognized for its rare disease and nephrology expertise, and we believe they have the ability to accelerate access to FILSPARI for patients. In FILSPARI's second indication, FSGS, the FDA has assigned a PDUFA date of January 13, 2026, and has informed Travere that an advisory committee meeting is no longer required. If approved, FILSPARI would be the first and only FDA-approved treatment option for FSGS, and Travere believes the FSGS commercial opportunity could be an even larger one with more rapid uptake as it compared to IgAN. Moving on, on October 7, Merck closed its acquisition of the Ohtuvayre marketer Verona Pharma for $10 billion. Our 3% Ohtuvayre royalty will now be assumed by the new marketer, Merck, who has significant geographic reach to expand the Ohtuvayre footprint globally, as well as robust clinical development infrastructure to accelerate development of Ohtuvayre in indications such as non-cystic fibrosis bronchiectasis. Moving on, we're very pleased with the commercial performance and clinical and regulatory updates provided by Merck on CAPVAXIVE this quarter. Merck expects that CAPVAXIVE will achieve majority market share in the adult setting in the pneumococcal vaccine category. Merck reported third-quarter sales of $244 million, representing a significant increase over the prior quarter, as well as a beat to analyst consensus. CAPVAXIVE was approved to prevent pneumococcal disease in Japan in August, and additionally, the FDA accepted Merck's SBLA for CAPVAXIVE in children and adolescents at an increased risk of pneumococcal disease with a PDUFA date of June 18, 2026. Next slide. Palvella completed full enrollment ahead of schedule in their phase III trial in microcystic lymphatic malformations in June, with results anticipated in the first quarter of 2026. Additionally, phase II trials in cutaneous venous malformations are expected in December of this year. Palvella recently announced a third QTORIN rapamycin indication in clinically significant angiocheratomas. Palvella plans to meet with the FDA in the first half of 2026 to discuss this phase II trial design. I'd also like to briefly discuss the commercial opportunity specific to QTORIN rapamycin for the treatment of microcystic lymphatic malformations. Phase III results are expected in the first quarter of next year, and this promising product has the potential to be the first and only FDA-approved treatment with strong prescriber interest. The therapy targets a concentrated population of over 30,000 diagnosed patients, primarily treated at 400 vascular anomaly centers, enabling a lean sales force strategy. Validated orphan pricing models and high unmet clinical needs suggest significant revenue potential in MLM. With QTORIN rapamycin, Palvella is building a compelling pipeline and a product which could represent a sizable royalty opportunity for Ligand. This franchise strategy outlines a phased approach targeting rare dermatological conditions, starting with microcystic lymphatic malformations, followed by cutaneous venous malformations, and clinically significant angiocheratomas. Palvella's longer-term plans include expanding to potential future indications, which Palvella believes could potentially grow the addressable patients by a factor of 10x. This represents a significant opportunity for market growth, and our 8-9.8% royalty extends across any and all approved QTORIN rapamycin indications. With that, I will turn the call over to Tavo. Thank you, Lauren. Before getting into the broader overview, I want to start with the deconsolidation of Pelthos, since it provides important context for this quarter's results. The spin-out became effective on July 1, and from that date, Pelthos has been deconsolidated from Ligand's financials. Historical operating costs through June 30 remain on Ligand's books, but beginning July 1, Pelthos expenses are now reflected under the newly merged Pelthos Channel Therapeutics entity, operating independently as a publicly traded company under the ticker symbol PTHS, with its own board and management team. Similar to our equity interest in Viking and Palvella Therapeutics, we hold an equity stake in Pelthos, approximately 50% of its outstanding shares. These are carried on our balance sheet as a long-term investment and remain restricted until the six-month lockup period expires on December 31, 2025. The current estimated fair value of our holdings in Pelthos is about $180 million as of yesterday's close. On July 1, we recognized a $53 million gain related to the Pelthos transaction, reflecting the difference between the $62 million fair value of the consideration received and the $9 million of net assets sold. As noted on our Q2 call, this gain included value associated with a sales-using out-license, which we've now quantified at $24.5 million and retained in adjusted earnings. While the out-license itself is a one-time event, out-licensing is core to our business strategy, and the Pelthos equity we received represents tangible value. For that reason, we included it in core revenue and adjusted EPS. The remaining $28.6 million of the gain, along with the historical incubation costs, have been excluded from non-GAAP results to maintain comparability with recurring operations. In addition to the gain on Pelthos, we recorded a $76 million unrealized gain tied to the increase in Pelthos share value, from $62 million at issuance on July 1st to $138 million at quarter-end. This appreciation underscores both market confidence in Pelthos and the strategic value of the transaction to Ligand. I'll walk through the financial implications of the Pelthos transaction in more detail on the next few slides. Moving now into the quarter's financial highlights, this was an exceptional quarter for Ligand, marked by record financial performance driven by the continued strength in several assets in our royalty portfolio and the recognition of the aforementioned sales-using out-license component following the spin-out and merger of the Pelthos business. We also capitalized on favorable conditions in the convertible debt markets in August, securing a five-year $460 million convertible note, which further strengthens our balance sheet. Total revenue and other income for Q3 2025 on a GAAP basis came in at $115.5 million, up from $51.8 million in the same quarter last year. Of that, $53.1 million was tied to the Pelthos transaction, including $24.5 million from the sales-using out-license and a $28.6 million gain on the sale of the business to Channel Therapeutics. As discussed earlier, we're including the $24.5 million, representing the estimated standalone value of the sales-using out-license as core revenue. The $28.6 million gain on sale of the business has been excluded. Therefore, on an adjusted basis, core revenue for Q3 2025 grew 68% year over year to $86.9 million. Other financial highlights to note: royalty revenue rose 47% year over year to $46.6 million, reflecting strong launch trajectories and outperformance across several recently approved products in our portfolio. Adjusted EPS grew 68% from the same period last year to $3.09. Given this strong financial performance, we're raising full-year 2025 guidance. We now expect core revenue of $225-$235 million and adjusted earnings per share of $7.40-$7.65 per share. We closed the quarter with $665 million in cash and investments. That brings total deployable capital to approximately $1 billion. A strong position that continues to fuel a very active business development pipeline. The funnel remains robust. At this point, we're not limited by dollars. We're limited by human capital, and we're planning to expand our business development and investment teams to meet the opportunity ahead. In August, we executed on a $460 million convertible debt transaction. We were very pleased with the pricing terms and secured a 75 basis point coupon rate and a 32.5% conversion premium. We also structured the transaction to be net share settlement to further reduce dilution. In conjunction with the notes, we executed an up 100% call spread, which will result in no dilution to our stock up to a price of $294 per share. The net proceeds not only bolster our balance sheet, but are accretive to earnings and allow us to take advantage of our robust business development pipeline. Moving on to the next slide, let me expand on our capital deployment capacity. We continue to generate robust annual operating cash flow, now exceeding $150 million on an annualized basis, and our current investment pace ranges between $150-$250 million. Against this backdrop, our decision to pursue a convertible debt financing was strategic, driven in large part by favorable conditions in the convertible debt markets. As of September 30, 2025, we held $665 million in cash and short-term investments and maintained access to a $200 million credit facility, bringing our total financial capacity to roughly $1 billion, inclusive of our holdings in Pelthos. We own approximately 50% of Pelthos outstanding shares carried on our balance sheet as a long-term investment, with an estimated fair value of $138 million at quarter-end, which we view as another potential liquidity lever. Looking ahead, given the robustness of our business development funnel and the ongoing expansion of our business development function, we may look to incrementally increase our capital deployment pace. We believe our bolstered balance sheet positions us well to pursue high-quality opportunities that align with our strategic financial and financial objectives. Moving on to the next slide, key drivers of royalty revenue growth this quarter include strong performance from Travere's FILSPARI, Merck & Verona's Ohtuvayre, Merck's CAPVAXIVE, and Recordati's Qarziba. Expanding briefly on a few of these, starting with FILSPARI, Travere reported third-quarter sales of $90.9 million, a 26% sequential and 155% year-over-year increase. They also received 731 new patient start forms during the quarter, showing continued adoption among both new and repeat prescribers. That momentum underscores the expanding use of FILSPARI in IgA nephropathy. As a reminder, Ligand earns a 9% royalty on sales, translating to nearly $9 million in royalty revenue this quarter, including our internal estimate of $7 million from sales generated by CSL Vifor in Europe. We're pleased to share that FILSPARI has now become our largest royalty-generating asset on an annualized run rate basis. Turning to Ohtuvayre, we continue to see strong commercial momentum. Verona reported $136 million of Ohtuvayre sales, a 32% sequential increase over the prior quarter. Ohtuvayre sales have beaten consensus in every quarter of 2025, and we anticipate a strong launch trajectory to continue. We are excited to see potential acceleration with this program now benefiting from Merck's broader commercial organization. Merck's CAPVAXIVE also grew significantly this quarter, reinforcing Merck's competitiveness in the pneumococcal vaccine space. CAPVAXIVE generated $244 million in sales, an 89% sequential increase, and a 46% increase over consensus. On Captisol, we recorded $10.7 million in material sales this quarter, compared to $6.3 million in the third quarter of 2024. The increase was driven primarily by the timing of customer orders. We recorded $58.2 million in contract revenue this quarter, up significantly from the $13.8 million in the prior year period. This includes the previously mentioned $28.6 million gain on the sale of the Pelthos business and the $24.5 million sales-using out-license. Turning to operating expenses, for Q3 2025. G&A expenses were $28.4 million, up from $24.5 million in the prior year quarter, primarily due to recognition of transaction costs related to the Pelthos transaction. R&D expenses rose $21 million from $5.7 million in the prior year period, driven by a $17.8 million one-time charge tied to our investment in Orchestra BioMed. This funding supports late-stage partnered cardiology programs and is accounted for as an R&D funding arrangement, fully expensed in the period of investment. Other income for the quarter totaled $86.2 million, compared to other expenses of $9.5 million. In Q3 2024. This year-over-year swing was primarily driven by unrealized gains from the increase in value of our equity holdings in Pelthos and Tovala, and higher interest income reflecting the impact of our strengthened cash position following the convertible note transaction. GAAP net income for Q3 2025 was $117.3 million, or $5.68 per share, compared to GAAP net loss of $7.2 million, or $0.39 per share, in Q3 2024. On a non-GAAP basis, adjusted net income was $63.8 million, or $3.09 per share, up from $35.3 million, or $1.84 per share, in the prior year period. The 68% increase in adjusted EPS was primarily driven by the $14.9 million increase in royalty revenue and the $24.5 million sales-using out-license component. Turning to guidance, as mentioned, we are raising total core revenue forecast to a range of $225-$235 million, and adjusted earnings per share is now expected to be between $7.40 and $7.65, a roughly 30% increase over last year's EPS of $5.74. With that context, here's how our revised full-year 2025 guidance is shaping up. Royalty revenue is now expected to be between $147-$157 million, up from the prior range of $140-$150 million. Captisol sales are expected to come in at $40 million. Contract revenue, which is where we capture the value of the sales-using out-license component, has increased to $38 million, up from $25-$35 million. Again, to reiterate, total core revenue is now expected to be in the range of $225-$235 million, up from $200-$225 million. We're raising core adjusted EPS to $7.40-$7.65, compared to the previous range of $6.70-$7. These updates reflect not only the impact of the Pelthos transaction, but also strong underlying growth and increased visibility into our royalty streams, particularly from FILSPARI, Ohtuvayre, Qarziba, and CAPVAXIVE. That concludes my remarks. I'll now turn the call back over to Todd for closing comments. Thank you, Tavo. We are very pleased with the strong launch momentum across multiple products, including FILSPARI, Ohtuvayre, FILSPARI, and ZELSUVMI, and believe there are significant opportunities for both indication expansion as well as geographic expansion for these products, which represent further upside for Ligand. We believe that Merck's global reach will accelerate Ohtuvayre's rollout, and their plans to invest in the incentive-entering pipeline programs will maximize its potential. Additionally, we're encouraged by the great progress the Pelthos team is making in ZELSUVMI and look forward to watching the continued launch momentum in the coming months. With a solid base of royalty-generating assets and late-stage pipeline, we are well-positioned to deliver sustained compounding growth and long-term value for shareholders. Additionally, our strong origination capabilities, our investment team, and our robust investment process is driving meaningful portfolio growth. Our deal team's ability to identify, access, and execute high-quality investments sets Ligand apart. Thank you, everyone, for joining us for today's earnings call. I will now pass it back to the operator and open it up for questions. Thank you. We will now begin the question-and-answer session. If you have dialed in and would like to ask a question, please press the star one on your telephone keypad to raise your hand and join the queue. If you would like to withdraw your question, simply press the star one again. If you are called upon to ask your question and are listening via loudspeaker on your device, please pick up your handset and ensure that your phone is not on mute when asking your question. Again, that is the star one to join the queue. We will pause for just a moment to compile our Q&A roster. Your first question comes from the line of Trevor Allred with Oppenheimer. Please go ahead. Hey, good morning. Thanks for taking my questions. I've got a few. First, we've seen both Pelthos and Palvella generate enormous value over the past year. Is there anything you can share on the available opportunities and special situations? Thank you, Trevor. This is Todd, and I think the opportunity set there is quite robust. Just to kind of frame this, the special opportunities is when one of the kind of the value components is missing, and we need to be more active in the investment in terms of adding team members, restructuring, and things of this nature. When we look at any investment, we're looking at kind of those three components: company's financial strength or access to capital. If that's all they need, then we're usually looking at a royalty investment, a royalty monetization, or simply providing capital. The other thing is strong management teams. We really need strong counterparties. Because we want to have as much operating leverage as possible, we're partnering with people that have clinical development capabilities and infrastructure, sales and marketing capabilities and infrastructure, manufacturing capabilities and infrastructure. When that portion of the component breaks down, then we have to get more involved than just providing capital, and we'll bring other complementary management into the mix. Those are restructurings. There are many opportunities like that out there. The last component is just general financial strength aside from our financing because we need companies that have strong access to capital, and we have to exist in this ecosystem, and equity is a very important component of what we do. Royalty capital needs to be a portion of the company's capital structure, but certainly cannot rely solely on it or even predominantly on it. When these situations arise, if they just need capital, it is usually not a special situation. The Novan situation where we picked up ZELSUVMI and the nitric oxide platform is a good example. There, you had a very good technical team, which we still work with today. We brought them into a subsidiary at Ligand, and they have what we believe was a great asset. And so we brought that into the subsidiary as well, restructured it, and eventually. We reset the marketing plan for ZELSUVMI once we got that approved and then relaunched a new company in the form of Pelthos. That's a situation where the company's access to capital had broken down, and they needed a more. Sales and marketing-oriented management team. That's where we will get involved in these special situations. There are a lot of those out there. We're typically doing those in cooperation with the counterparties, though, where they know those components are missing. The one other consideration on those is that they are quite consuming. They take a deal team. It takes a lot of attention. And so you really have to go after deep value and significant returns, which we believe we will achieve in the Pelthos situation and in others like that that we've taken on. But let me put it this way: there's way more of those to do than we can do, and that's why we are adding a little bit to our management and deal team, including the operating components that we have, which help us manage through these situations. Got it. Thanks, Todd. That's helpful. And then my second question is a bit of a two-parter. Can you comment on how the number of investment opportunities has shifted over the past year? Are you seeing accelerating capital demands? And then can you also comment on how new cash balance changes either the scope or the size of how you're approaching deal-making, if at all? Sure. Yeah. Taking the latter first, I think that our diversification strategy right now has us pegged at about, as we've been saying, we do not want to put any more than $50 million into a binary risk situation. We are seeking out things that have significant evidence of safety and efficacy and on a relative basis are de-risked. Still, we are buying risk, and we do not want to put more than $50 million right now into a potential binary risk situation. That said, we view diversification by asset. In multiple asset situations, we can size up the deals very significantly. We also, as you know, will use equity as a tool here. This makes us a very good partner. I think the Orchestra example, which Paul led for us, is a good one. We got what we think is a very good royalty investment and two great product development programs there. We were also able to facilitate, or catalyze, if you will, a broader equity round and get the company into a much greater position overall of financial strength so that we are, in fact, coexisting with significant amounts of equity in that situation at this point. We believe the company has a great management team and has now much, much better access to capital in the long term as well. We can be very good partners because we are able to support companies kind of throughout their capital structure. Getting to the overall kind of deal types and demand, I would just say that royalty capital, for lack of a better term, is really 5% or less of the market. I would say on the development side, significantly less. That is where capital is most needed. I think there is a huge opportunity there. There is way more to do than we can do. The deal flow does move around a little bit, mostly in style, not in amount, as the capital markets change. For example, when an IPO market opens up, a lot of the late-stage private companies want to get public, so they are more inclined to do that so they can provide liquidity for their equity investors. Still, even in those cases with very strong companies and strong equity syndicates, as was the case with Castle Creek, they want, and there is a rationale for having royalty capital be a component of your total capital structure. Sounds great. Thanks for taking the question. Yep. Thank you. Once again, if you would like to ask a question, simply press the Star 1 on your telephone keypad. Your next question comes from the line of Matt Hewitt with Craig-Hallum. Please go ahead. Hello, and congrats on the quarter. This is Todd Cormann on from Matt Hewitt. Last week, the FDA announced it wants to speed up the process of personalized gene therapy. How should we think about the Castle Creek investment and general opportunities in gene therapies going forward? Thank you. Yeah. I think that's one of the points that Lauren was making earlier in the call here is that there's some concerns around some volatility and changes at the FDA. We're focused, as we've said many times, on high-value assets targeted towards severe clinical need that can be really impactful. That's kind of the FDA's core reorientation strategy as well. We think there's great overlap between just our investment strategy in general, investing in products that will make the most amount of difference for patients, and what the FDA is orienting around in that regard. I can't say that it'll have a specific impact on any individual asset or company, although we know that the OT field has already benefited from that. There clearly is an effort to be more pragmatic in severe diseases, certainly where there are currently no treatments, but also where there's marginally adequate types of treatments available. I think that that's a sensible strategy. They're talking about shortening the review timelines from 12 months to a couple to a few months. That's very positive for us. As you know, our general strategy also is to invest in assets that are within at least three or four years of a potential approval. We sometimes will invest in phase two. That's where we originally invested at Palvella. In those situations, we rely heavily on third-party data. For example, off-label use of rapamycin in some of the conditions that Palvella is currently exploiting had existed prior to that investment. There's real-world evidence of efficacy and safety, even though it was, for us, an earlier-stage asset. We view that as de-risked, but it still had the full timeline to march through. On top of being able to take advantage of those types of repurposed and de-risked assets, we also potentially, in general, can be looking at shorter timelines for approval and review. Appreciate it. Thank you. The next question comes from the line of Jayed Momin with Stifel. Please go ahead. Hey, this is Jayed on for Annabelle. Congrats on the strong quarter. I did have two questions. One. Is there any additional color you can provide for the ZELSUVMI launch? I know you talked about it a bit, but what do you expect going forward for the next couple of quarters? My second question is if there's any other details you could provide for the Arecor transaction, typically for AT292 that's being developed by Sanofi. What does the royalty rate look like? Any details there would be helpful. Thank you. Sure. I'll cover the ZELSUVMI launch, and you'll be disappointed with the additional information I can share because I can't share much more. I'll have Lauren discuss AT292 and our arrangements there. In terms of the ZELSUVMI launch, they're reporting, I think, on the 13th, where you will get a lot more information. We just followed general script data, and I can tell you, from our perspective, that's encouraging. That's something that analysts and everybody else has access to as well. They haven't changed their guidance yet going forward. I think that the general guidance they've offered at this point, which is sensible early in a launch because launches are very hard, is peak sales of $175 million. In general, I think that's conservative. The management team there is appropriately conservative at this point in a launch, but there will be a lot more specifics available for that on the 13th when they have their earnings call. With that, I'll hand it off to Lauren just to discuss the Arecor and AT292. Great. Thanks, Todd. Sure, thanks for the question. On AT292, or after all, for an Alpha, we're really excited about that asset. We view it as being highly differentiated versus the standard of care. This is a treatment that is designed for patients with Alpha-1 antitrypsin deficiency. It was licensed to Inhibrx and then acquired by Sanofi in 2024 for $1.7 billion. Clearly, they have a lot of conviction around the asset as well. What's differentiated about it is that we're seeing a potential movement from plasma-derived to recombinant treatments and also a much more convenient dosing regimen for patients. As Todd mentioned in his remarks, we were really encouraged to see the phase two potentially pivotal data released by Sanofi, which was very positive just last month. We're really encouraged by the progress of this asset in the very short time since we've closed this transaction. With regards to the royalty exposure here, these are actually technology access fees, and that is what we are able to disclose in terms of what we will receive on this asset. Thanks for the question. Thank you for the answers. The next question comes from the line of Sahil Dhingra with RBC. Please go ahead. Hi. This is Sahil for Doug. Thank you for taking our questions. My first question is related to the competition. Have you seen any changes in the competitive landscape for royalty asset as it relates to either on-the-market products or products that are in clinical stage? I have a follow-up. Sure. Not yet. I think there will be people interested in this space because it makes so much sense. I think that this is a very, very logical place for royalty capital to. Focus on, and I've thought that for a long time. There was a lot of inertia around the initial funds because they were funded mostly by large debt allocators like pension funds that were following debt metrics and wanted debt levels of risk. You really couldn't go into the development side. I think that will change over time. Our view is that there will be competition. We haven't seen any yet, frankly. We haven't been competitive in very many deals at all. Most of the folks that do development-stage clinical investing are much, much larger than we are. That's one component of it. The other component is that in excess of $12 billion of royalty capital that is available, the very significant majority of that is focused on commercial-stage assets as opposed to development-stage assets. Yeah. Thanks. That is helpful. Then my follow-up question is related to the recent approval of Lasix ONYU. The product where you have royalties. How do you see that product versus the existing products in the market, specifically Furoscix that is marketed by scPharma, which was recently acquired by another company, Mannkind? We also saw a recent approval of a nasal spray in the same category. Could you speak to what are your thoughts on the product and peak sales potential for that product? Thank you. Sure. Thanks for the question. Yeah, we were really encouraged to see the full approval for our partner, SQ Innovation. I think the existing product kind of has validated the potential for moving the treatment from the inpatient setting to the outpatient setting. There is a lot of kind of macro momentum around trying to get patients out of the hospital more quickly, kind of across the healthcare spectrum. We are really encouraged to see patients have another treatment option. We believe that it is differentiated in several ways, including the size of the device and just sort of the convenience for patients and the commercial rollout strategy. We will look forward to seeing more. At this point, there is no information regarding guidance or anything like that, but we view this product as a very positive introduction into the marketplace. Thank you. Thank you. This does conclude our question-and-answer session. I would like to thank our speakers for today's presentation, and thank you all for joining us. This concludes today's conference call. You may now disconnect.