Acurx Pharmaceuticals, Inc. ($ACXP)

Greetings, and welcome to Acurx Pharmaceuticals conference call to discuss full year and fourth quarter 2025 financial results. [Operator Instructions]. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Rob Shawah, Chief Financial Officer. Thank you. Please go ahead.

Thank you, Donna. Good morning, and welcome to our call. This morning, we issued a press release providing financial results and company highlights for the year ended and fourth quarter 2025, which is available on our website at acurxpharma.com. Joining me today are Bob DeLuccia, Executive Chairman of Acurx; Dr. Michael Silverman, Medical Director of Acurx who will be available for questions related to our R&D activities and strategy during the Q&A period; and David Luci, President and CEO of Acurx who will start by providing a corporate update and outlook. Following that, I'll provide some highlights of the financials from the year and fourth quarter ended December 31, 2025 and then turn the call back over to Dave for his closing remarks. As a reminder, during today's call, we'll be making certain forward-looking statements, which are based on current information, assumptions, estimates and projections about future events that are subject to change and involve a number of risks and uncertainties that may cause actual results to differ materially from those contained in the forward-looking statements. Investors should consider these risks and other information described in our filings, with the Securities and Exchange Commission, including our annual report on Form 10-K, which we filed yesterday, Thursday, March 12, 2026. You are cautioned not to place undue reliance on these forward-looking statements, and Acurx disclaims any obligation to update such statements at any time in the future. This conference call contains time-sensitive information that's accurate only as of the date of the slide broadcast today, March 13, 2026. I'll now turn the call over to David Luci. Dave?

Thanks, Rob. Good morning, everyone, and thank you so much for joining us to review our financial results for the fourth quarter and year ended December 31, 2025 and also to hear some recent updates, which we're excited about, then we'd be pleased to take any questions. First, I'd like to briefly summarize just a few of our key activities for the fourth quarter of '25 or in some cases, shortly thereafter. First, in October, the company received gross proceeds from the execution of 170,000 Series F Warrants of approximately $1.4 million. Also in October, we were 1 of 5 companies to make a formal presentation at IDWeek in Atlanta at the session entitled New Antimicrobials in the Pipeline. Presenting on behalf of Acurx were Dr. Michael Silverman, our Medical Director, who is with us this morning, and Dr. Kevin Garey, Professor and Chair, University of Houston College of Pharmacy and the Principal Investigator for microbiology and microbiome aspects of the ibezapolstat clinical program. The company's presentation included an update on ibezapolstat and its microbiome sparing properties. Also, presented were new colonic-microbiome data from a state-of-the-art mouse infection model, showing a potential microbiome-sparing class effect of representative compounds from our DNA pol IIIC inhibitor preclinical pipeline. In describing the work performed at its laboratory at the University of Houston, Dr. Garey stated, initial work on a novel lead DNA pol IIIC inhibitor compounds indicate that the positive microbiome-sparing results from our ibezapolstat studies may be a class effect. This is an important finding because microbiome sparing likely contributed to ibezapolstat's sustained efficacy in the Phase II trial for C. diff infection where no patient cured of CDI experienced a recurrence. In our recent experiments, mice given the comparator antibiotic Linezolid demonstrated an overabundance of uncommon and harmful gram-negative bacteria known to contribute to recurrence of infection. Dr. Garey further stated, these data indicates a low probability for DNA pol IIIC inhibitors to increase the risk of causing a C. diff infection. Vancomycin resistant Enterococcus or other gut microbiome-related infections. In November, the company announced that the Nature Communications Scientific Journal published results from its scientific collaboration with Leiden University Medical Center demonstrating structural biology research that reveals for the first time a DNA pol IIIC inhibitor, ibezapolstat, bound to its target. The publication has entitled: A unique inhibitor transformation selectively targets the DNA polymerase PolC of Gram-positive priority pathogens. This is an important milestone in Acurx's highly productive scientific collaboration with Leiden University Medical Center in Holland in advancing development of these new-to-nature compounds fortifying the foundation for the rational development of this innovative class of antimicrobials against other Gram-positive priority pathogens. On March 9, 2026, we issued a press release announcing that we are launching a groundbreaking ibezapolstat clinical trial program in patients with recurrent CDI that has the potential to shift the treatment paradigm and the prevention of rCDI from 2 agents to 1 agent. When coupled with ibezapolstat Phase II results of being highly effective, 96% clinical cure in 26 patients, in treating acute CDI with no recurrence in patients while sparing the gut microbiome, this new trial will position ibezapolstat as a candidate to be the first agent to demonstrate clinical success in both the treatment of CDI and the prevention of recurrent CDI. In our Phase II trial, all 25 patients treated with ibezapolstat who experienced a clinical cure were free of recurrence one month after treatment and 5 out of 5 of these patients were observed for 3 months after treatment, and they remained free of recurrence. During our Q&A this morning, members of our R&D team will be available to answer any questions about this new trial program. But briefly, this new clinical trial in rCDI begins with an open-label pilot trial to gain experience with ibezapolstat in patients with multiply recurrent CDI with at least 3 episodes of CDI within the past 12 months. This will inform elements of the planned active controlled Phase III registration trial in the rCDI indication to be implemented following favorable results from the open-label 20 patient trial. Upon subsequent successful completion of the Phase III pivotal rCDI trial, and per the operative FDA procedure, the company plans to request FDA approval for treatment and prevention of rCDI under the FDA's Limited Population Pathway for Antibacterial and Antifungal Drugs Guidance for Industry published in 2020. Acurx's clinical program in the broader CDI patient population is ready to advance to Phase III international pivotal clinical trials. In this regard, we're very excited about the FDA's recent announcement published in the New England Journal of Medicine that a one-trial requirement will be FDA's new default standard for registration. If formalized, this would end the long-standing two-trial dogma. We look forward to FDA's further clarification and the potentially favorable implications to our clinical development programs, such as the opportunity to seek marketing approval for the broader CDI population with one pivotal clinical trial. In February 2026, we announced that the U.S. Patent and Trademark Office granted a new patent for our Pol IIIC inhibitors, covering composition of matter and method of use. This patent extends to December 2039, subject to extension under U.S. patent rules. We continue to identify and pursue funding opportunities for our Phase III clinical trial program for ibezapolstat as well as consideration of alternative financial pathways to achieve success. We have several initiatives underway to this end and we'll report in future updates as appropriate. As we've continually reported, ibezapolstat clinical and nonclinical results continue to outperform in a serious and potentially life-threading infectious disease caused by C. difficile bacteria that the CMC categorized as an urgent threat and calls for new classes of antibiotics for initial treatment that also have a low incidence of recurrence. Additionally, ibezapolstat has qualified infectious disease product and FastTrack designations from the FDA for the treatment of C. difficile infection as well as SME or small and medium enterprise status in Europe. We remain confident that while development of ibezapolstat's competitive profile continues to evolve and strengthen, we will continue to navigate successfully through these challenging times in the macroeconomic environment and in our industry sector. And now back to our CFO, Rob Shawah, to guide you through the highlights of our financial results for the full year and fourth quarter ended December 31, 2025. Rob?

Thanks, Dave. Our financial results for the fourth quarter and year ended December 31, 2025 were included in our press release issued earlier this morning. The company ended the year with cash totaling $7.6 million compared to $3.7 million as of December 31, 2024. During the quarter, the company raised a total of approximately $1.5 million of gross proceeds through purchases under the Equity Line of Credit with gross proceeds of purchases under the Equity Line of Credit totaling approximately $4 million for the full year of 2025. Research and development expenses for the 3 months ended December 31, 2025 were $0.3 million compared to $0.8 million for the 3 months ended December 31, 2024, a decrease of $0.5 million. The decrease was due primarily to a decrease in manufacturing costs of $0.2 million and a decrease in consulting costs of $0.3 million as a result of prior year trial-related expenses. For the 12 months ended December 31, 2025, research and development expenses were $1.8 million versus $5.4 million for the 12 months ended December 31, 2024. The decrease of $3.6 million was primarily due to a reduction of $2.6 million in manufacturing-related costs and a $1 million decrease in consulting costs as prior year had higher expenses related to Phase IIb and Phase III preparation costs. General and administrative expenses for the 3 months ended December 31, 2025 were $1.3 million compared to $2 million for the 3 months ended 2024 -- December 31, 2024, a decrease of $0.7 million. The decrease was primarily due to a $0.3 million decrease in compensation-related costs and a $0.3 million decrease in professional fees. For the 12 months ended December 31, 2025, general and administrative expenses were $6.3 million versus $8.7 million for the 12 months ended December 31, 2024, a decrease of $2.4 million. The decrease was primarily due to a $0.9 million decrease in professional fees, a $1.4 million decrease in share-based compensation, a $0.4 million decrease in compensation costs, partially offset by a $0.3 million increase in legal costs. The company reported a net loss of $1.6 million or $0.73 per diluted share for the 3 months ended December 31, 2025 compared to a net loss of $2.8 million or $3.29 per diluted share for the 3 months ended December 31, 2024, and a net loss of $8 million or $5.32 per diluted share for the 12 months ended December 31, 2025 compared to a net loss of $14.1 million or $17.45 per share for the 12 months ended December 31, 2024, all for the reasons previously mentioned. The company had 2,348,113 shares outstanding as of December 31, 2025. With that, I'll turn the call back over to Dave.

Thanks, Rob, and to all of you for joining us today. Before bringing our operator Donna back to open the call for questions, I'm pleased to welcome to the call, Michael Silverman, and Bob DeLuccia, our Medical Director and Executive Chairman, respectively, to assist with further explanation of our recurrent C. difficile infection trial program. Bob, would you like to add any comments?

Sure. Thanks, Dave. And as you said, these are very challenging times, but we think we can rise above them head on with our new clinical development plan. I think in Phase II, as Dave said, ibezapolstat was demonstrated to be highly effective in both curing the acute C. diff infection and in preventing recurrence. So based on this, we believe it has the potential to be the first to demonstrate clinical success in both the treatment of the infection and the prevention of recurrent CDI. And such success would shift the paradigm of treatment and prevention of rCDI from 2 agents to 1. And I think this would be a game changer to the public health threat that affects approximately 500,000 patients with CDI each year in the U.S., results in approximately 30,000 deaths and it generates a related public health cost burden of approximately $5 billion, of which $2.8 billion is related to recurrent CDI. I also think that our new clinical program strengthens ibezapolstat's competitiveness and if approved for marketing, gives an even more attractive value proposition in the marketplace, and which, by the way, ibezapolstat commercial supply chain of active pharmaceutical ingredient and packaged product will be made in America. Thanks, Dave.

Thanks, Bob. And now back to Donna, our operator, for today's call for questions. Donna?

[Operator Instructions]. Today's first question is coming from Jason McCarthy of Maxim Group.

I have a few, so if you just bear with me. Starting with the new recurrent CDI trial, for the primary endpoint for -- I'm assuming it's prevention of recurrence, how far out do you have to go? Is it 3 months, 6 months, 1 month and so on? And what is the cost of that trial?

Bob?

Yes. First question was how far out, you mean in terms of evaluation through the end point? How long?

Yes, sir.

Mike, you can take that question, if you like. Just explain treatment period as well as the follow-up period.

Sure. Thanks for the question, Michael Silverman here. Following the end of treatment, we will observe patients for recurrent disease to a first endpoint, a primary assessment endpoint of 8 weeks. That's based on other products that are out there having been approved for prevention of recurrent disease. The standard there has been weeks, suppressant has been 8 weeks. So that will be our endpoint for recurrent disease. We will continue to follow patients out for approximately 6 months after the end of therapy to gather additional data.

Okay. Just as a follow-up to that, when you go out to 6 months in general, what do you see as the rate of recurrence with vanc or any other treatment that they're getting on average?

Yes, it's a good question. We may not have data after 6 weeks on the drugs that are out there that has not necessarily been the standard follow-up. Vancomycin, we can see rates of recurrence between 20% and 40%. For the anti-recurrence therapies that are out there like [indiscernible], those recurrence rates are down in the range of 15% to 30%. And I'm talking about 8 weeks label indication. Okay, Jason?

Got it. Yes.

Dave, do you want to address the cost question?

The only thing I think we left out is the treatment period. I think there's a small modification to that, Jason. Bob, do you want to provide that?

Yes. Go ahead, Mike. The initial treatment...

Sure. You may recall that in our prior trials, we've used a 10-day treatment period because, again, that's been standard of practice, standard of care for the other drugs that are approved, vancomycin, fidaxomicin. For this trial, for the recurrent disease trial, we're going to a 14-day treatment period for all patients that's based on prior work that's been done in the anti-recurrence drug -- with the anti-recurrence agents longer period of treatment for the acute episode may result in a higher cure rate, which would give us a more robust sample size in which to evaluate recurrence.

And the cost?

Yes, it's in the range of $4 million to $5 million.

So it's likely that the current cash balance maybe with a little bit of a top-off gets you through this, I guess, we call it a pilot study in recurrent CDI. And is that something that we could see the start and conclusion of in 2026?

We'll certainly start enrolling in 2026 in the second half. But then we'll see how far we get with the enrollment. We think we have some really high enrolling centers, but we wouldn't expect to be fully enrolled for about 12 to 15 months. I should add, Jason, that we also have our ELOC, right? So in terms of topping off, we have between $7 million to $8 million left on our ELOC.

Okay. Perfect. And then just two more quick ones, and then I'll jump back. So if this pilot is successful, does it change and you're starting to think about recurrent CDI for the Phase III, does that change the size, the potential size of a Phase III because if it was acute, I think it was somewhere in that 400 to 500 patients per trial to Phase IIIs. I know that the that narrative seems to be changing to 1 Phase III these days. But just for recurrent CDI in general, do you need less patients to get an approval versus acute?

Yes. Thank you, Jason, for that question. Mike, you can answer that in terms of what we are projecting for the follow-on trial to the open label? We have a range of estimates right now, but it depends upon what we see in the open-label trial, right?

Yes, I'd like to emphasize what Bob said. Right now, we don't have any treatment data with ibezapolstat in this patient population. So we don't know the true effect size. We have very good estimates of the other agents that are out there, Jason, as you mentioned. But we still need to gather data on the ibezapolstat in terms of clinical cure rate and prevention of recurrence. Based on what we think are reasonable assumptions that is going back to our Phase II trial in a slightly different patient population, we're currently projecting somewhere between 360 and 400 patients for a single trial in the recurrent CDI indication.

Got it. Okay. That makes sense. And then just lastly, I know you guys -- you had mentioned U.S.-based manufacturing, which seems to be a very important issue these days with the current administration. Is that something that you're really trying to make headway with regulators on or the current administration in terms of having -- you could see pol IIIC inhibitor being used in lots of different things, maybe it's something the government is interested in stockpiling. David, do you want to just kind of opine if you would, on that aspect of the U.S.-based manufacturing?

Yes, I think you hit it pretty straight on, Jason. We're continuing to have detailed discussions with government agencies, including BARDA, and it's important to them in their consideration of a public-private partnership that our program be made in America. So that's part of what makes them excited about getting appropriate funding allocated to each sponsor that's looking for government money, as you say, these days under this administration.

Yes. I agree, Dave. And I think the point about potential government stockpiling on these, one of the things that's working in our favor is that ibezapolstat and pol IIIC in general are very stable over time. Our ibezapolstat API, right now, we have about 48 months stability and probably close to 5 years, sorry, 48 months and closer to 5 years stability and similar length stability in packaged form. So that makes it prime for stockpiling.

Yes. Jason, I'd just like to add one other little one for you in one of my conversations on Capitol Hill, I heard from a former Navy pilot that MRSA is kind of burgeoning greatly in Navy ships. So the government apparently is looking for a new pipeline in that area. As you know, we have something for that.

Our next question is coming from James Molloy of Alliance Global Partners.

I want to follow up on -- more on what Jason said or asked on the timing. In the March 9 press release, you said the first patient here in the Phase II fourth quarter '26. Should we understand correctly the 12 to 18 months after the fourth quarter of this year for this Phase II to fully enroll?

Yes. So sometime in the fourth quarter, plus 12 to 15 months.

Okay. And then obviously, the Phase III wouldn't start until some point after that.

Correct.

Is it possible for Phase III to start? Can you give interim data and the Phase III might start if things change during that trial?

Can you repeat that, Jason (sic) [ James ]?

Is there any chance of any interim data out of the Phase II that might spur the Phase III to start? Or at this point, going down this path, the Phase III [indiscernible] would not start until this Phase II is done.

Yes. I mean it's possible, Dave or Mike, you can comment on that again, but we really would like to see the full 20 patients for decision-making and being best to size the following trial, the controlled trial. Mike or Dave?

It will give us confidence.

Yes. It's a balance, but I agree with Bob. The more data we have, the more confidence we have in being able to start to size the Phase III trial. We can certainly get started with preparatory activities if we're encouraged. But as Bob said, the more data we get, the better off we'll be.

Yes. I guess I would just like to put an asterisk on it. Understanding we ended our Phase IIa in acute CDI early and the IIb, we ended early. We're going to take a preliminary look at the first 10 patients and we'll be able to call an audible if we -- if our Scientific Advisory Board feels it's appropriate.

And would that be -- would that audible happen on the first 10 patients potentially after the 8 weeks? Or would you wait the full 6 months?

It would depend on what the R&D guys think. I would imagine it would be after the 8 weeks because I don't think many of these programs have been evaluated for 6 months.

The most important endpoint is 8 weeks, David.

Yes.

Okay. And then maybe may be hard to answer this one, but I know you talked about the 1 trial deal getting away from the 2 trial dogma. Speaking with a number of other companies who have gone in front of the FDA, obviously, a lot of things have been said about trying to speed things up and make some changes to the clinical trial procedure. But some of these other companies who spoke with have not found really much difference when they actually approach the FDA, still are facing the folks, same people beneath. How -- it maybe early to say, but how really do you think the 1 trial might be?

Maybe I can take that one, Dave. I'm pretty encouraged that I think that is going to be a game changer here as well as a number of other things. We have -- one of our scientific advisers is Mark Goldberg, who is the former Head of the animocrobials division at the FDA. And his read on it, what has to happen next is that this needs to be formalized. So they'll probably -- and we believe they're already working on our guidance for industry to clarify some of the questions and lay down the parameters for what that would be. In our case, as I think one of -- maybe Jason mentioned this as well, too, we currently plan to do roughly 474 patients 2 trials, excuse me, [ noninferiority ] to Banco. If we only have to do 1 trial, maybe we'll bump that up a little bit so that we cover the safety database with 1 trial. But we're poised and ready to talk to FDA at the appropriate time and things need to settle down before they actually get all their ducks in a row and sort of codify it. Does that help?

Just to add on to what Bob said, looking at it from the top down, Jim, and you can see this on our website, it takes the government time, but we have time for this change to go into effect because we have the 20-patient trial in front of us. And the paper talking about ending the 2 trial dogma was co-authored by Marty Makary, the head of the FDA that's on our website. It's in the New England Journal of Medicine. But certainly, if there's going to be a change in this regard, Marty Makary is the guy that you would want to see as a co-author on the paper.

No, I've certainly seen it. I've seen and heard a lot of talk about the changes. They do need to get their ducks in a row still. So it's a bit of [indiscernible] still, but I hope that certainly comes to pass.

[Operator Instructions]. We're showing no questions in the queue at this time. This concludes today's event. We'd like to thank you for your interest in Acurx Pharmaceuticals. You may disconnect your lines, and enjoy your day.