Greetings. Welcome to the A2 BioPharma Fiscal 2026 Full Year and Q4 Earnings Call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two if you would like to remove your question from the queue. Please note, this conference is being recorded. I will now turn the conference over to your host, Robert Bloom with Lithum Partners. You may begin.

All right, thank you and good afternoon, everyone. As the operator indicated during today's call, we will be discussing A2 BioPharma's fiscal 2026 fourth quarter and full year operational and financial results for the period ended June 30th, 2026. Joining us on today's call is A2's Chief Executive Officer, Josh Disbrow, and Ryan Selhorn, the company's Chief Financial Officer. At the conclusion of today's prepared remarks, we will open the call for a question and answer session. I'd like to remind everyone that today's call is being recorded. A replay of today's call will be available by using the telephone numbers and conference ID provided in the press release issued earlier today or by utilizing the link on the company's website under events and presentations. Finally, I'd also like to call to your attention the customary safe harbor disclosure regarding forward-looking information. The conference call today will contain certain forward-looking statements including statements regarding the goals, strategies, beliefs, expectations, and future potential operating results of A2 BioPharma. Although management believes these statements are reasonable based on estimates, assumptions, and projections as of today, these statements are not guarantees of future performance. Time-sensitive information may no longer be accurate at the time of any telephonic or webcast replay. Actual results may differ materially as a result of risks, uncertainties, and other factors including but not limited to the factors set forth in the company's findings with the SEC. A2 undertakes no obligation to update or revise any of these forward-looking statements except as required by law. With that said, let me turn the call over to Josh Disbrow, Chief Executive Officer of A2 BioPharma. Josh, please proceed.

Thanks, Robert, and welcome, everyone. I'm very excited about the progress we're making and the opportunity ahead for A2. We finished fiscal 2026 with an encouraging fourth quarter. As Actua continued to build, our ADHD business performed better than anticipated, and A2 returned to positive adjusted EBITDA. Actua gives us something special to build around. It's the first and only selective serotonin 5-HT1A receptor agonist approved by the FDA for the treatment of major depressive disorder in adults. Its novel mechanism and differentiated tolerability profile address an important need in a category where many patients struggle to find a treatment that works well for them and that they can stay on. As a reminder, the opportunity is substantial. An estimated 21 million Americans are affected by MDD, and the U.S. prescription MDD market exceeds 22 billion. Even a modest foothold in a market of that size would be meaningful for A2. We strongly believe Exua has the potential to become an important treatment option and a major growth driver for our company. It's one thing to have had excitement before a launch occurs, but what makes this especially exciting is that we are now seeing that opportunity begin to take shape in clinical practice. Physicians are gaining experience, patients are continuing treatment, and our prescription base is expanding. These early results reinforce our conviction in Exua and give us a strong reason to keep building, with the same focus on execution and financial discipline. As we have discussed for some time, our approach to Exua is methodical. We are building the business with a clear focus on productivity, the return on our commercial investment, and preserving cash. As we have communicated, this was never going to be an oversized, quote, spend at all costs, boom or bust type of launch. This quarter gives us meaningful evidence that our approach is working. Today, let me spend most of my prepared remarks discussing the Exua execution, including what we're seeing in the field and the decisions we are making as the launch develops. I'll also spend a little more time on ADHD because the notable durability of that business certainly deserves attention. Ryan will then cover our financial results and our fiscal 2027 outlook. Exua generated $3.9 million of net revenue in the fourth quarter, up from $2.4 million in the third quarter, bringing its fiscal 26 contribution to $6.6 million. As a reminder, our formal launch only occurred at the beginning of January and broader field deployment in late February and early March. We remain early in building physician awareness and experience with Exua having only just completed our first full quarter of launch. During the June quarter, total prescriptions were 3,323 compared with 1,398 in the March quarter. The monthly progression was 973 prescriptions in April, 1,089 in May, and 1,261 in June. As we entered fiscal 27, July increased further to 1,377. August was up at 1,408 prescriptions. Importantly, ectua grew from July to August despite the overall MDD market declining. That is meaningful progress as more physicians begin using ectua and patients move from initial treatment into refills. One item I think is important to understand as we look at the trajectory in the early going is that we have consistently said we would manage this launch methodically, and that includes expecting a high-performing sales organization and holding that sales organization accountable for performance. Where representatives have not been performing at high levels or at the high levels we need, we have made adjustments in real time. As a result, we have seen ebbs and flows in the number of sales individuals on a month-by-month basis. Importantly, several of those changes occurred during June and July and our field force reached a low of 32 representatives in July. That was down from 43 reps at the end of March. This was intentional as we were demanding high performance across the sales organization. Standards have been set and will be upheld and will remain disciplined with our capital deployment throughout the launch. Those changes temporarily reduced our coverage while we worked to fill territories and optimize the profile of our sales specialist position. Since that low, we brought the sales force back to approximately 42 representatives, and we continue to fill open positions. We're also adjusting territory coverage based on what we're learning, adding resources where the opportunity supports them, and combining sales specialist coverage where that makes better economic sense. One of the key metrics we're watching is weekly and monthly prescriptions per sales rep. Using month ed field force headcount as a directional measure, in March, we had 761 prescriptions and 43 sales specials, or about 18 prescriptions per sales rep per month. In July, we had 1,377 prescriptions and 32 representatives, or approximately 43 prescriptions per rep for the month. That's more than a twofold increase in prescriptions per rep, with total monthly prescriptions also increasing 81% over that period. We're continuing to be proactive and fine tuning the team, but we view that as an encouraging measure of the productivity of our commercial effort. To add some additional color on rep performance, which is clearly going to be the key driver of our success with Exua, consider some other numbers. If you look at our current active sales specialists, the top 10 are averaging almost 15 prescriptions per week. The top five are averaging 18 and a half prescriptions per week. But importantly, as I share these numbers, I should note that we are not top heavy with respect to the percentage of territories driving the majority of the actual prescriptions. In fact, 24 territories, or approximately 60% of the current sales force, are driving 70% of the actual prescriptions, demonstrating very good breadth across many geography and across many sales specialists. So that gives us great confidence in knowing that we have a product that is being and can be broadly adopted and broadly sold. To see what actual weekly scripts could be in the relative near term, as some of our newer sales specialists we've on board have come up the curve, consider what a weekly run rate looks like by simply having 45 territories at the weekly script rate of the top 5 or 10 territories. By simply generating 15 prescriptions per rep per week, that gets us to 675 TRXs per week. and at the current selling price, that's already a $26 million annual run rate if you were to simply dollarize TRXs for ease of math. Taking that weekly rep average to 20 TRXs per week, which again, five territories are already averaging that plus or minus, and then you're looking at 900 TRXs weekly or about a $35 million run rate annually. And then at 30 TRXs per rep per week, again, a weekly number achieved by multiple reps already That takes the annual run rate to over $50 million, again, by simply dollarizing prescriptions. So with a refined sales team that will be getting us to 40 plus and more likely closer to 45 territories, you can see why we're excited about a significant lift of script levels in the relative near term. And speaking of near term, and this is happening really before any of the newly hired reps are even up the curve, we're seeing Exua take that next leg up. For the week ending September 4th, just before Labor Day, we generated 394 prescriptions, a significant jump from July and August levels. Again, when the newly onboarded folks get their feet under them, we're excited to see what the script trends look like. Growing refill activity is also part of the picture, alongside the work our representatives are doing to develop prescribing relationships. We look at this measure together with total prescriptions, new and repeat prescribers, and the economics of the business as we decide where to put the next dollar of investment. This is what we mean by a methodical launch. We are using the data to make staffing and spending decisions, learning from the territories that are performing well, and addressing the ones that need improvement. We believe that's how we build a commercial organization that can support Exua over time while maintaining the financial discipline we've worked hard to establish. Perhaps most importantly, the feedback from physicians who are gaining experience with Exua remains highly encouraging. In our latest launch-to-date update, nearly 1,200 unique prescribers had written Exua, and nearly 2,500 unique patients had received it. We're seeing repeat prescribing from physicians who are developing a broader base of experience with the product, along with encouraging feedback on patient response and on patient tolerability. At the same time, many physicians in that prescriber base have only used Exua with one or two patients. Of course, we know it takes time for a physician to identify appropriate patients and then assess their experience and then ultimately become comfortable using a new medicine more broadly. That process develops over time. Our opportunity is to deepen utilization among those early adopters while continuing to introduce Exuo to additional prescribers. We remain very encouraged by the response from physicians who are moving beyond their first few patients and continuing to prescribe. And it's precisely those prescribers who have written Exuo for a handful or more patients that are most impressed with the results. We continue to hear that across the country, and of course, that gives us great confidence in the product. Access also continues to support the launch. Reimbursement approval rates remain encouraging, and we are seeing a growing contribution from Medicaid and Medicare alongside the commercial business. RxConnect remains an important part of helping patients initiate and continue treatment and helping prescribers and their practices navigate access. Ryan will touch on this a bit, but growth to nets are significantly higher than our initial expectations. As we move into fiscal 27, we will continue investing in Exua sales and marketing and in the medical and scientific education that supports physician understanding of the product. We will continue assessing the results and directing resources toward the activities that are producing the strongest return. Our fourth quarter results are an encouraging indication of what this model can deliver. We grew Exua revenue, benefited from the continued contribution of our legacy products, and generated positive EBITDA at the company level while keeping cash relatively stable. Profitability and cash preservation remain central to how we're managing the launch. Of course, there will continue to be variability in quarterly results as we invest and as the business moves through its normal seasonal patterns. Again, Ryan will walk through that in more detail. Our objective, however, remains to build a durable, profitable actual business on the platform we already have with commercial spending tied to strong ROIs. Turning to ADHD. ADHD. The portfolio performed better than anticipated in the fourth quarter. Net revenue was $10.4 million compared to $9.1 million in the March quarter and $13.1 million in the fourth quarter prior year. For Adzenis, our brand and authorized generic together continue to retain approximately 80% of the prescriptions in the market for Adzenis and its generic equivalents. We believe this speaks to the durability of the franchise and the value of the RxConnect model, even with substantially less commercial support behind the brand. We also have our Cotempla authorized generic in the market, and it's gaining prescriptions week over week. As of today, Teva has not yet launched its generic version of Cotempla following the July 1 date permitted under our settlement agreement with Teva, presenting potential upside to our base case assumptions around Cotempla's revenue run rate. As always, ADHD has normal seasonality, with the earlier part of the first half of our first school year typically softer due to kids being out of school. The fourth quarter performance, however, reinforces our confidence in the value this portfolio brings to A2. It remains an important source of profit and cash to support our investment in Exua. Rounding out the legacy business, our pediatric portfolio generated $1.8 million of net revenue in the fourth quarter compared to $0.9 million in the March quarter and $2 million in the prior year quarter. These are mature products that we continue to service efficiently, and while smaller, pediatrics does remain a useful and durable contributor to the legacy business and the financial foundation supporting Exua. Overall, we are highly encouraged by the progress in Exua and the durability of our legacy business. Our focus remains on execution, profitability, and preserving cash. With that, let me turn the call over to Ryan for financial results in fiscal 2027 outlook. Ryan?

Thank you, Josh. Let's jump right into it. I'll primarily cover our fourth quarter results and then spend a few minutes on our outlook and how we expect fiscal 2027 to unfold. Let's start on the revenue line. Net revenue for the fourth quarter of fiscal 2026 was $16.1 million compared to $15.1 million in the prior year period, an increase of 6%. Revenue also improved from $12.4 million in the third quarter with sequential increases across all three portfolios. For fiscal 2026, net revenue was $57.6 million. Breaking that down, Exua contributed $3.9 million in the fourth quarter compared to $2.4 million in the third quarter. We are encouraged by that progression as we build the prescriber base and expand our commercial activity. The recent prescription data Josh discussed show continued progress with 3,300 scripts written during the fourth quarter. Remember, however, that prescriptions and unit shipments are different measures. During the fourth quarter, we shipped 4,599 units. Revenue reflects product sales into the channel, net of estimated rebates, discounts, and other adjustments, and will not necessarily move in lockstep with prescriptions in any given period. We continue to see favorable growth in nets for Exua relative to our initial launch assumptions. Payer mix, reimbursement, and the level of patient access support all influence these economics. It is still early and we want to see how those factors develop over a longer period before assuming the current realization rates will hold. The ADHD portfolio generated $10.4 million in the fourth quarter net revenue compared to $13.1 million in the prior year period and $9.1 million in the third quarter. The sequential improvement benefited primarily from better growth to net realization. We continue to view this portfolio as an important source of cash flow with limited promotional spending behind it. The pediatric portfolio generated $1.8 million in fourth quarter net revenue compared to $2 million a year ago and $0.9 million in the third quarter. These are mature products, and payer mix, returns, and ordering patterns can affect the quarterly results. However, they continue to contribute to the cash generation of the legacy business. Gross profit was $10.4 million in the fourth quarter, with a gross margin of approximately 65%, compared to $10.3 million and 68% in the prior year period. Sequentially, gross margin improved from 61% in the third quarter, which included a $0.7 million inventory write-down. For fiscal 2026, gross profit was $36.8 million, or 64%. Exua's underlying economics remain attractive. As we discussed last quarter, the royalty and product cost structure equates to approximately 31% of cost of goods sold, or roughly a 69% gross contribution margin, before certain fixed costs. Our consolidated reported margin also reflects those fixed costs, product mix, and inventory adjustments. I'll come back to margin outlook in a moment. Turning to operating expenses. Total operating expenses were $11.2 million in the fourth quarter compared to $17.9 million a year ago. The prior year quarter included a $8.3 million impairment charge. So excluding impairment, restructuring costs, and intangible asset amortization from both periods, operating expenses were $10.4 million compared to $8.7 million on an apples-to-apples basis. The year-over-year increase primarily reflects extra commercialization costs Partially offset by continued cost discipline elsewhere in the organization. We spent less on certain commercial programs than originally planned during fiscal 2026, and some of that planned activity will shift into fiscal 2027. As Josh mentioned, we want to make sure we have strong ROIs on all investments made. If we don't believe we can get the returns or need to adjust the plan to get it right, we will. Interest expense was $0.4 million in the fourth quarter compared to $0.7 million a year ago. For the full year, interest expense declined to $1.9 million from $3.7 million, primarily due to the pay down of our fixed payment arrangements. Those arrangements had no remaining balance at June 30th. For the fourth quarter, we reported a net loss of $0.1 million. On a per share basis, the loss rounded to zero cents per share This is compared to a net loss of $19.8 million or $2.92 per share in the prior year period. For fiscal 2026, net loss was $14.3 million. The fourth quarter included a $1 million non-cash derivative warrant liability gain. The prior year fourth quarter included $18.1 million of combined impairment expense and derivative warrant liability loss. These items have a significant effect on the GAAP comparisons. Adjusted EBITDA was a positive $0.5 million for the fourth quarter, compared to a positive $2 million a year ago and a negative $2.8 million in the third quarter. For fiscal 2026, adjusted EBITDA was negative $3.7 million. The reconciliation of this non-GAAP measure to net loss is included in today's earnings release. Turning now to the balance sheet. Cash and cash equivalents were $26.3 million at June 30th compared to $26.7 million at March 31st and $31 million at the end of fiscal 2025. While cash was relatively stable during the quarter, we also reduced our revolving credit facility balance to $6.1 million from $10.4 million at March 31st. Subsequent to year-end, we repaid the remaining revolver balance. Separately, the carrying value of our term debt, including the current and non-current portions, was approximately $11 million at June 30th. For fiscal 2026 as a whole, we generated $3.3 million of cash from operating activities, compared to using $1.9 million in fiscal 2025, an improvement of $5.2 million. Improved receivable collections and inventory turnover were meaningful contributors. We also used $7.9 million in financing activities, primarily to reduce our revolver, term debt, and fixed payment arrangements. Accordingly, the year-over-year reduction in cash reflects significant balance sheet deleveraging rather than operating cash burn. Stockholders' equity was $35.3 million at June 30, 2026, compared to $19 million a year earlier. As discussed last quarter, the March warrant amendments reclassified $26.4 million from warrant liabilities to equity. This was a non-cash reclassification that reduced our exposure to future earnings volatility associated with those warrants. Before I turn it back over to Josh, I want to walk through the financial framework for fiscal 2027. We are not providing revenue guidance, but we do want to give you a clear view of our planned expenses Margin Expectations, and the Expected Progression of Profitability and Cash Flow. Our current plan calls for approximately $49 to $54 million of operating expenses on a gap basis. Excluding non-cash expenses, total cash-based operating expenses are expected to be approximately $45 to $49 million. The largest increase is in sales and marketing, where we expect to invest up to $6 million, now plans for fiscal 27 rather than fiscal 26. This was always part of the plan, but it has been deferred from fiscal 26 to fiscal 27. The increase will support Salesforce coverage, marketing programs, and physician and patient education for Exua. We also expect a more modest increase in G&A, including medical affairs and support for the commercial organization. Research and development expense should remain minimal, and we expect interest expense to continue to decline steadily on a full year basis. As we mentioned, we will manage spending against the results we are seeing. The budget gives us room to support the opportunity, and the timing and level of investment will depend on the prescription trends, access, commercial performance, and available liquidity. We currently expect consolidated gross margin to be lowest in the first part of fiscal 2027 and to improve as the year progresses. Driven principally by anticipated product mix as Exua continues to scale, and the absorption of fixed manufacturing and supply chain costs. Our current expectation is to approach 66% to 67% gross margin in the fourth quarter of fiscal 2027. The timing of the aforementioned investments as well as the normal seasonality are important to understanding the year. We expect lower adjusted EBITDA and operating cash flow in the first half of fiscal 2027 than in the second half. We will be making planned investments in extra sales and marketing ahead of their full contribution while the ADHD business is typically seasonally softer in the first quarter to half of our fiscal year. From a cash flow perspective, we also have our annual PDUFA fees that come out in the first half of the year. As we move into the second half, we expect that seasonal pressure to reverse and EXOA to make a larger contribution as our commercial efforts build. Based on our current plans taken together, we expect a six-month period ending June 30, 2027 to generate positive adjusted EBITDA. Thank you, Ryan.

As we look ahead, our conviction in the actual opportunity remains extremely strong. We're seeing physicians gain experience with the product, a growing patient base, and improving prescriptions per sale specialist rate. We're also taking action where execution needs to improve. This is consistent with the approach we've described from the outset. Overall, we're extremely pleased with the progress this quarter and remain excited about the path ahead. As always, I want to thank our entire team for their work and everyone participating on today's call. We'll now be happy to answer any questions. Operator?

Thank you. At this time, we will be conducting a question and answer session. If you would like to ask a question, please press star 1 on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star 2 if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment, please, while we poll for questions. Once again, please press star 1 if you have a question or comment. The first question comes from Thomas Flayton with Lake Street Capital. Please proceed.

Hey, guys. I appreciate you taking the question. Just to start off, both of you mentioned that the GTN discount was more favorable than you had expected, and it looks like it's more favorable than our model. Can you talk a little bit about the puts and takes that made that more favorable?

I can take that to start, and then Ryan, feel free to fill in. And thanks, Thomas, for the question. In short, it's just a higher than anticipated approval rate, really, across commercial payers. That's the simple answer. We're seeing it consistent. We're seeing it hang on, really, month to month. It is lower for the titration pack, but frankly, that's come in materially higher than we modeled initially. And the 30 counts in a regular way prescriptions are coming in at a higher approval rate as well. So that's the key piece. And they are holding on. And I think I don't want to suggest have the potential for improvement. But as we build a higher percentage of government business, as you probably know, that's an even higher, excuse me, an even higher percentage. or better GTN, I should say. So that's and that is representing well north of 20, 25 percent of the business. If you look at analog products in the category, some have achieved upwards of 35 to 40 percent of the business coming from Medicare and Medicaid. And so it's a combination of that portion of the business growing and then just overall improvements, overall approval rates better than, again, we had initially modeled and initially anticipated. And this all reminds you is all without any commercial contracts. And we have no supplemental Medicaid or Medicare rebates.

And then can you talk a little bit about your utilization of RxConnect for Exu? I know it represented a significant chunk of your ADHD portfolio, but maybe some commentary around that would be great.

Yeah, it is. We look at shipments into RxConnect partner pharmacies, and then we look at dispensed claims. I'm most interested in dispensed claims because ultimately that's where the rubber meets the road, and that's where the The patient obviously gets the prescription. It's lower than the current percentage of ADHD, but certainly we would expect it to grow over time. When you look at dispensed claims for ADHD, that's any given month upwards of 80% of our total prescriptions are dispensed through an RxConnect. partner pharmacy or as part of the program. It's not to that level, but it is it is growing because we do have quite a few prescriptions coming from white space and from areas where we don't have rep coverage. We do have some what we call free range prescriptions, and we also are going to build a materially higher base of government business. And some of those we don't track at the moment. And while those can and are filled at RxConnect partner pharmacies, in many cases, those are just filled at a pharmacy outside the network. and so that having been said we would expect over time to continue to drive more and more prescribing to the RS Connect pharmacies just given the moat that that represents and what we think can really prove out to be an elongated tail even post loss of exclusivity but obviously we've got some time before we get there.

And then final one for me speaking of which you obviously had a nice sequential uptick on the ADHD portfolio and I realized that you know the Catempla generic didn't come to market Can you talk a little bit about how you've been able to not only maintain but then grow sequentially the ADHD portfolio with limited coverage? Is it just one of those things that happened or was there something proactive that you did?

Well, we're always monitoring the base business as it relates to gross to net reimbursement rates, pharmacy reimbursement in particular. And there certainly is real-time adjustments going on to ensure that we're optimizing sort of the payer, sort of the mix there as it relates to dispensing and filled prescriptions and claims. So that's a piece of it. So certainly there's an element of being proactive. So I would say GTN's had some improvement and some uptick. There was, and that's, I mean, that's the bulk of it really. So, yeah, I would say that's that has been actively managed and that's something that could be managed with relatively few resources. We have, of course, internal resources dedicated to that. And so that's it largely has just been optimizing GTNs and ensuring that the pharmacies are sort of in adequate shape with respect to the AG and the brand. And of course, we're able to seamlessly toggle or they're able to seamlessly toggle between the brand and the AG. And again, I'll remind you that the ANDA has really been slow. The Teva product has kind of hardly scratched 20% when you look at the overall available market of prescriptions. And while prescriptions have come down year on year, that's largely attributable to just the pool promotion that we pulled over a year ago.

That's awesome. Thanks for the questions. Congrats on the quarter. Thank you, Thomas.

The next question is from Naz Rahman with Maxim Group. Please proceed.

Hi, everyone. Congrats on the progress, and thanks for taking our questions. Just a couple. So first, in terms of the prior odds, could you provide some color on, I guess, how the prior odds are evolving? And what I mean by that is, are you seeing the prior odds get approved first pass more frequently, or do you know what percentage of the prior odds get approved in the first pass versus how many are requiring multiple back and forths? And I have a follow-up after that.

Yeah, thanks for the question. Nas. In terms of Pryoroth, it's still a relatively early stage and What I'll say is because of the nature of this patient with multiple failures, we absolutely are having success from a prior authorization perspective. So obviously, we're not doing them. We can't do them on behalf of the customers, the prescribers that ultimately complete the paperwork. But we've made it very simple for them. It's a really straightforward process. Physicians are increasingly utilizing the service. They have to engage with a specific vendor to get signed up and so forth, and they log in and essentially do a very, very simple process. and the approval rates for prior authorizations are quite high. If you look at the success we're having with claims that are submitted sort of through the program, it's in the neighborhood of 70%. So we're having quite a lot of success. That's materially higher than most categories. I think it's because of the ease of use of the program that we've implemented, also the class and the patient type. Again, this is going to be a patient that's often been on multiple medications. So it's been very, very encouraging in the early stages of this.

Got it. That was helpful. And one last question. In terms of coverage and reimbursement, I mean, previously you talked a lot about the importance of government payers. At this point, when can we expect, I guess, the next large bolus of payments in terms of both commercial and government payers, and what would you expect first?

That's a good question. We don't really think of it as bringing on any sort of one big lever. We think it'll sort of organically evolve. Frankly, if these GTN levels just maintained with the coverage we have today without any contracts, that would be a really, really good situation, a really good story. So we continue to really scrutinize the need to contract proactively. In fact, I think we're at the point of not proactively contracting, same on both sides, government and commercial. doesn't do us any good to contract on the government side and pay large supplemental rebates when states in one way Thank you. Thank you. We'll, of course, continue to keep ourselves open to contracting, but we don't think of it as necessarily saying, okay, we're going to have a step function. Because one of the things that we know is payer contracts don't drive demand. So if you sign an agreement with the large PBM, you don't automatically get a step function in your demand. It still comes down to prescribers sending prescriptions to pharmacies, and that's, of course, driven by us. So what you can do from a payer perspective is you can optimize and tweak sort of GTNs and pricing, but you don't necessarily think of those as just because you have a contract with one of the big three PBMs doesn't mean a physician will automatically prescribe. Really to the contrary, because we have RxConnect set up and to some degree we serve as the backstop, if you will, to guarantee that that patient never pays more than $50 on a commercial claim, we don't really have a need to go out and shout from the rooftops that we have a contract with a large PBM. It doesn't preclude the possibility that we would engage with one, but it has to be on the terms that make sense for us economically. and, you know, we're generating enough demand to start to generate some interest and some inbound conversations. But time will tell as to really how valuable those conversations turn out to be. And we're really in a good spot based on the GTNs today. And again, don't feel a need to proactively contract on either side of the ledger, commercial or government.

Got it. That was helpful. Thanks for taking my questions.

Thank you.

Once again, if you have a question or a comment, please indicate so by pressing star one. The next question is from Ed Wu with Ascendian Capital. Please proceed.

Yeah, congratulations on all the progress. My question is on the sales rep. You mentioned that you were at 43 in March, 32 in July, 42 now. Do you have a goal in mind of where you think you want to be maybe in six months? And I know you mentioned that You know, these reps get up to speed pretty fast. Is it within three months that you feel that they are able to hit their stride?

Yeah, good question, Ed. Thanks for that. You know, the goal will be dictated, obviously, by cash flow. We said that from the beginning, but certainly materially higher than 42 or 49. I mean, we have a plan that's at least a multiple of that, if not higher, in terms of where ultimately we see the footprint getting from a sales specialist perspective. But that will be driven. The timeline will be driven by profitability and cash flow to enable us to expand in a prudent fashion. And so we don't have a specified goal of it has to be 60 reps by the end of the calendar year and then 120 by the middle of next. Although that type of cadence would suggest that we're on a good trajectory and are generating an adequate level of cash flow to justify that level of investment. And we're being very judicious in how we think about territories. In some cases, we are doubling up in areas. In other cases, we're keeping a single territory just because it's able to be efficiently managed that way. And ultimately, that's sort of how we think about it. Sorry, I missed the second part of your question.

In terms of how quickly do these sales ramp up, is it a quarter, six months?

Six to nine months realistically is a good time frame to really think of somebody as sort of adequately tooled for the job. And if you look at really sort of a break-even analysis, you would look at something closer to nine or 12 months. But in terms of really identifying, I guess there's a couple of components there. Identifying that the person has the requisite skills, drive, demeanor, all the things you need to be successful. that takes less time to also get that rep to turn that into action on the part of the prescribers. That's something more like six to nine months. And so as we think about a phased approach of getting to that next layer of geographies, you know, we sort of think of it with a six to nine month ramp up period in mind. So that's what's really encouraging. You know, we hit an all time high prescription, a weekly prescription level the week ending September 4th of almost 400 prescriptions. I'll remind you that's still with a Thank you for joining us today. it's actually that's significantly lower than any of our reps got on at Zennis if you looked at its historical highs so quite confident that 40 to 45 reps and then expanding to 50 and beyond getting to 20, 30 and then ultimately you know 50 plus prescriptions a week it's pretty exciting to think where that puts us from a revenue trajectory perspective.

And just to clarify the amounts I think you mentioned 3,000 prescriptions for the quarter. Does that include refills?

That includes refills, yeah. That would be starter and that would be initiation. The starter titration packs would be sort of the initiation and then we think of refills as once they get transitioned to the 30 count regular sort of stable dose and then a refill beyond that. Yeah. And again, keeping in mind that many of these patients, you know, they've just gotten started over the first month or so. Some patients are titrating more slowly than the label sort of indicates. And so, you know, some of these patients are, you know, just getting into their first month or so. So we've not yet to see anything resembling sort of the compounding effect that we would, you know, expect to see as the months move forward.

All right. That sounds good. Well, thanks for answering my questions, and I wish you guys good luck. Thank you.

Thanks, Ed.

We have reached the end of the question and answer session, and I will now turn the call over to management for closing remarks.

Thank you, John. Again, just to reiterate, we're extremely pleased with the progress this quarter, particularly as it relates to the trajectory we're seeing with Exua. We're increasingly encouraged by the number of territories driving meaningful prescriptions and ultimately the breadth of prescribing. We're most excited about the response that we're hearing through physicians due to the feedback they're getting from their patients, patients saying things back to their physicians like it's been life changing and haven't felt this good in years. And that's just why you do Why we do what we do. So we continue to have the pedal down, work very hard every single day to ensure that as many prescribers as we can hear about the actual story and ultimately put pen to paper to prescribe what we think is an outstanding treatment and it's proving to be that in the real world. So with that, we're very encouraged. We are now, of course, into our fiscal 27th. towards the end already of our first quarter. So we'll look forward to sharing those results with you all in November. Until then, thank you for your interest in A2. Thanks for your time and have a good evening.

This concludes today's conference and you may disconnect your lines at this time. Thank you for your participation.