Aquestive Therapeutics, Inc. (AQST) Earnings Call Transcript & Summary

All right. Well, good afternoon, everyone. This is David Amsellem from the Piper Sandler Biopharma research team. I know it's a real busy day, and we're trying to all get through the heart or really the tail end of the 3Q earnings cycle. We got a lot to cover, though, with Aquestive. And I think this will be a really informative and insightful hour that we'll be spending with the Aquestive Therapeutics senior leadership team. And we really have the whole team here. We've got Dan Barber, President and CEO; Ernie Toth, CFO; Gary Slatko, Chief Medical Officer; Melina Cioffi, SVP, Regulatory Affairs; Cassie Jung, Chief Operating Officer; and Sherry Korczynski, Chief Commercial Officer. So thanks so much to all of you for joining. I know many of you are at the ACAAI meeting down in Florida, and there will be data presented there in the coming days. So a big forum for all things Anaphylm.

So with that, I wanted to turn it over to Dan just for a quick introduction. And also, I'll start with, as I typically do with these things, a question. So with [indiscernible], also a question here, looking more broadly at the company. Obviously, Anaphylm and getting Anaphylm right is the top priority. But longer term, how do you balance that top priority with other clinical and commercial programs, including the pipeline of epinephrine prodrug platform? In other words, Dan, just as part of the intro, talk to the kind of company you're looking to build over the next several years.

Sure. Well, first, David, thank you to you and the team at Piper for taking the time today to spend with us and let us tell our story and always appreciate it, and it's always a good discussion. So I don't know if I'm setting a record with the number of team members that I've brought with me today. But typically, when we do these conversations, it's myself, Ernie and Sherry. And given where we are in our cycle and the fact that we're close up to our PDUFA date and hopefully our launch, I wanted people to see that it's not just me saying what's going to happen, it's a broad team of experienced people who are responsible for these things and know what they're doing. So I may talk a little less today than typical, which I think is a good thing, because you'll hear what other people have to say. But from your initial question, which I really appreciate, David, the tone you said at the beginning of, well, where is this company going? What are we all about? What are we trying to be? And Anaphylm, as you perfectly said, absolutely is front and center and will be where our focus is and our resources and our energy. But we are a company that believes we can be bigger than just Anaphylm. And the reason we believe that is because of the technology that created Anaphylm, our AdrenaVerse epinephrine prodrug technology, which, as you've heard me say before, we are the only ones who have patented the ability to absorb and, in different ways, release epinephrine, which we think creates a variety of places that the product -- the technology can be used. So the way I look at the company over the next several years is Anaphylm is the first proof point of what we can do with AdrenaVerse, and there are a variety of programs yet to come. And when I think about -- if I get really dangerous and think about, well, what does that mean for the value of the company, I truly believe if we do our jobs well and we create the pipeline clinical proof points that we can, that the value of whatever you think Anaphylm makes this company worth, that pipeline should be equally as valuable. So double what just Anaphylm on its own is worth. And that's why it's so important as a company to not just be about one product that you're launching, but about a technology that can produce multiple programs over the years to come.

That's very helpful. Okay. So let's dive in. And I think what's top of mind for investors is the FDA review process. Obviously, you have the PDUFA coming up. So I wanted to start with maybe a backwards-looking question, which is on the regulatory process. Can you just talk to the key items that were part of the safety update to the NDA filing?

Well, I'm very lucky the way we're set up as a company. My office is, I don't know, Melina, what am I, 30 feet away from you? So her and I are constantly going back and forth and making sure we're updated on what's going on. So I will hand it over to Melina to walk you through all of the great work she's done on the NDA side.

Thank you, Dan. So in response to your question, David, focused on the safety update, just to provide a little bit of color to that, it is a required submission for any NDA. It needs to be submitted 120 days following submission of the initial application. We were, in fact, able to submit the required safety update on time within the time frame. The data that's within the safety update is actually not new. It's a representation of data based on information requests and questions that we had early in the review. That said, I would just point out that the review has been active and remains active. So certainly, we received information requests at the very beginning prior to submitting the safety update. And those information requests continue in a very healthy way.

Does the -- just a clarification question. Does the NDA or the safety update to the NDA include the pediatric data?

It does. In fact, the NDA contains a complete data set of the pediatric data.

Okay. That's helpful. So regarding being notified that you would not need an Ad Comm, just wanted to better understand how that safety update played into the agency's decision here. And then secondly, talk generally about your dialogue with the agency from the safety update to being notified about the lack of a need for the Ad Comm. Always helpful to get some context around that decision that was communicated to you by the agency.

Absolutely. And I think by way of background as well, you must appreciate that the possibility of an advisory committee meeting was on the table even prior to submission, and it was reiterated at the time of our filing communication. So going from the time of the filing communication, not only was there the submission of the safety update, but there were a variety of submissions that we made. Specifically, they were responses to information requests that we received along the way. Now we believe that we have adequately responded to any and all questions that the agency had throughout that process, so much so that I do believe that at the point of the mid-cycle review, which is around the time that they had ultimately communicated that decision to no longer hold an Ad Comm, that we have sufficiently addressed any concerns or questions that they may have had that would have led them to ultimately need one.

Okay. And can you talk to the CMC part of the filing, facility inspections and how we should think about where things stand there?

Certainly. So in terms of a CMC facility or any inspection, that is a possibility at any point during the review process. With respect to the facility itself, it is a GMP facility. So we certainly always need to be prepared for inspections. What I can say is that we have received 2 inspections of clinical sites so far. They are part of our pivotal program, and there were no major findings noted following those inspections. And of course, the possibility still nonetheless exists that additional inspections could be warranted.

Yes. Have you had -- or can you say if you've had a pre-approval inspection?

So at this point, what I can say is that the clinical sites have certainly been the focus of the inspection activity thus far.

And just to add on to that, David, we have not had a PAI. And I'll ask Cassie to just opine, we have had the FDA at our manufacturing facility in the recent past. If Cassie, you could just walk through that.

Yes. I think just to add to that, as Melina said, given that we are a GMP manufacturer, right, we're in a constant state of audit readiness. And as Dan just mentioned, we were this year audited by the FDA, just standard unannounced audit, as well as regularly audited by other regulatory bodies, including the TGA. And then, of course, as you can imagine, regularly going through audits with our partners, right, for whom we manufacture and provide product for. So again, we're always in a state of readiness, right? That's part of our business.

Yes.

Are you in labeling discussions?

Melina, you...

Certainly. What I can say is at this point in the review, it would not be expected. We are not at that point in the review process.

Okay. All right. So let's move to the clinical package here. So I have some questions about Cmax. And I think this is something that investors have zeroed in on. So looking at Cmax for Anaphylm, both with and without allergen exposure, so clearly higher than what we've seen for, say, the manual intramuscular injection. So I guess the question here is how should we conceptualize this in terms of safety, clinical implications, if any?

Certainly -- yes, please go ahead.

Do you want to say something, Dan?

Well, I just want to -- I can't help myself, as David knows. There is one thing that people should remember, which is as a company that does 505(b)(2)s for a long time and looks at comparability, the product used in the public domain is the auto-injector, right? So the manual -- and obviously, David, I know you know that the manual IM curve by nature is much, much lower, right? But Gary, I'll let you get into the details.

Right. So the relevant data here is the oral allergy challenge study that we conducted in collaboration with the FDA. Data is being presented at the meeting here. And we saw geometric mean maximum concentration values in the low 400 to upper 300 range in subjects or in patients with or without allergy challenge, respectively. The purpose of this study, which is well above the intramuscular and not -- and fairly close to the range that one might expect with EpiPen in normal volunteers. Importantly, the study was conducted with the intent to make sure that if a patient experienced swelling in their mouth, that, that wouldn't impede the pharmacokinetic or pharmacodynamic effects of Anaphylm in the presence of symptoms of anaphylaxis that could manifest that's called angioedema. So in the study, we saw robust elevations in the range that we hope to see. In fact, the levels were slightly higher in the presence of oral edema. So that's encouraging, because it suggests that the edema not only impairs the effect, but actually enhances it, well above intramuscular injection and in the range of the auto-injectors. And basically, falling into this range meets the FDA's bracketed target range that they were looking for as an outcome from the study.

Okay. I did want to drill down on not just Cmax, but pharmacodynamic properties. So maximum systolic blood pressure, maximum diastolic blood pressure. So looking at, I think it was your pivotal and which did incorporate EpiPen, not just manual, we are seeing -- and feel free to jump in, but we are seeing what looks to be a greater increase in SVP and DVP for Anaphylm and also pulse as well. So I guess I'm just trying to better understand what's happening here and talk to how you think about clinical implications.

Well, the clinical implications are that in the presence of anaphylaxis, the patient is at risk of circulatory collapse and shock, which is manifested by low blood pressure. So the fact that Anaphylm as well as all the other epinephrines mitigate against that loss of blood pressure is an important pharmacologic effect and desirable effect of administering any of these agents. The elevations that we're seeing with Anaphylm are within physiologic range. They were all in the mild-to-moderate elevation category. They did occur early, which is, again, something that in something like anaphylaxis, you don't want there to be a delay in the beneficial or the effective -- these effects that we observed. So they occur quite early. And we see this as evidence that the product is achieving its intended therapeutic effect, which all of them do, increasing blood pressure, cardiac output, reducing bronchospasm and reducing edema. So we are actually encouraged by the fact that we're seeing this robust performance in terms of blood pressure and heart rate elevations.

Is it -- I guess the question -- maybe I'll state the question differently, is the elevation in blood pressure, for instance, being higher than the injectable modalities, is that something that could elicit concern on the part of practitioners? And I know that this is all transient and this is in a rescue setting. But if you're getting higher elevations in BP, higher elevations in pulse versus the currently available modalities, however transient they may be, what is the extent to which that could be problematic, not just from a practitioner perspective, but even from a regulatory perspective?

Well, the elevations -- as I mentioned, the elevations we're seeing are in the mild-to-moderate category. None of these were considered severe or in the range that would invoke an intervention by a physician in order to reverse these elevations. They were still in the range of fluctuating blood pressure that one might see in the normal population or patients with controlled hypertension. So we're not concerned about them being severe or too high. And as I mentioned, the pattern of the elevations actually is something we are excited about potentially looking into further following commercialization because it appears that there's not only a significant increase, but it's occurring quite early, which is desirable when compared to, say, the intramuscular epinephrines, which tend to manifest these elevations later on a delayed basis. So FDA has not raised this as a concern. And so we're encouraged by this. And it's also important to remember that this is being administered in the outpatient setting and by the patient on their own. And if you can satisfactorily control their anaphylactic reaction early in the field, they may not need to be transported in to be seen in an emergency room, that, that would be considered by guidelines to be a sufficient level of response and might actually save them an ER visit or a hospitalization.

Yes. I wanted to actually touch on that, because this is a paradigm where obviously, it could be an emergent situation and require a hospital visit. But my understanding, and correct me if I'm wrong, is that if you've got anaphylaxis and even if you self-administer epinephrine and you get your symptoms under control, don't you have to go to an ED/emergent care setting anyway for examination? Or isn't that sort of advisable?

In the past, the common practice was to take the epinephrine and call an ambulance and be transported to the hospital for a follow-up evaluation. However, fairly recently, in 2023, there was some new guidelines that were issued that basically recommended that if the reaction is sufficiently treated in the field and the anaphylactic symptoms are controlled, then emergency transportation to an emergency room is not necessarily part of the management plan. So that has evolved fairly recently. But you're correct, in the past, it used to be that was the first step of a trip to the ER.

Okay. All right. That's helpful. Just wanted to continue along the discussion of safety. I know in the oral allergen challenge study, there were a few cases of palpitations. And again, this is epinephrine. So I'm taking that with a grain of salt. But I guess the question is how clinically relevant is this?

Right. Well, what was observed were mild-to-moderate palpitations, meaning they weren't sustained. They were transient, they resolved on their own. It's very, very common because of the receptor effects of epinephrine to see these kind of chronotropic effects. In fact, these palpitations are listed in all of the epinephrine -- labeling of all the epinephrine products. So not surprising, not concerning. They only become concerning if you see longer stretches of them occurring in a row with EKG patterns suggestive of abnormal morphology, in which case those need to be managed. The good news is we didn't see any of those runs of palpitations in our program.

Okay. So I wanted to just kind of level set overall safety, BP, heart rate, et cetera, how that compares to EpiPen and also the intranasal competitor. I mean we have, obviously, at least relative to the injectables, we have the pivotal data, we have the oral allergen challenge data. It looks like you're getting really pretty high therapeutic concentrations, which you talked about as being desirable. I mean the drug is doing what it's supposed to be doing. But in terms of just safety and the implications of that Cmax, how do you compare and contrast Anaphylm versus the intranasal product that's available and also the gold standard EpiPen?

Yes. Well, I think one of the things that we have seen in terms of consistency is the maximum concentration from Anaphylm of epinephrine is very consistent in about the 12-minute time frame after administration. Whereas with the other epinephrines, there's a more lack of consistency with a broader spread, if you will, in individual patients having earlier or much later maximum concentration. So there's a predictability about Anaphylm's pattern in that it elevates quickly in most of the patients, which is, again, a desirable effect. It also, because of that early elevation, could help the patient determine whether they're getting enough of an effect from the first dose and whether or not they actually do need to have a second dose and not administer a second dose unnecessarily. Whereas if they have a lot of variability with the other products, some that might be more delayed in their maximum concentration, they won't be able to judge that early on, and they may administer a second dose that they didn't really need. So we think that this PK, pharmacodynamic, pattern is actually quite favorable for the condition it's treating. As far as the information about Neffy, I think the best thing to say is that they have their own literature that they published and presented, or are presenting, and it's probably best to review that literature and posters at this meeting down in Florida and make your own determination about whether you think the pattern that is displayed there is favorable or not.

I wanted to switch gears a little bit and ask about oral swelling, swelling of the tongue, swelling of mouth in the context of a severe allergic reaction/anaphylaxis. And how could that get in the way of effective administration of Anaphylm?

Right. Well, oral swelling or swelling in the mouth can occur not in all patients with anaphylaxis, but in a minority, it's called angioedema. I mentioned that earlier. What we did see, when we intentionally induced oral swelling in the OASIS study, about 25% of the patients had swelling of the tongue and cheek and throat. However, the swelling resolved very rapidly. It was within 5 minutes on average. So whatever is being manifested from the underlying disease, it's being rapidly mitigated by the presence of the epinephrine in the oral cavity. In our other studies, our human factor studies, no patients had any difficulty -- no caregivers or patients had any difficulty administering Anaphylm under a variety of different conditions. And patients were able to self-administer Anaphylm on their own and achieve comparable blood levels to that, that was seen with it after administration by a health care provider. So we feel like this collection of data supports ease of use, no difficulties with administration, and is very supportive of the viability of this as a drug patients can carry with them and administer themselves without a problem.

So in terms of clinical -- sorry, in terms of resolution of clinical symptoms in the oral allergen challenge study, I think you cited median symptom resolution of about 5 minutes. I wanted to get your thoughts on how that compares to currently available modalities.

Right. Well, we didn't do a side-by-side comparison in this program. We can say with what we saw that the symptom resolution occurred very rapidly. And if this was a manifestation of anaphylaxis, the time to resolution of most of the symptoms along with the time to maximum concentration are about the same interval. And therefore, people are going to be able to determine whether they got a benefit or they need further care within a very short time frame, particularly since they don't have to face some of the difficulties that they might otherwise face with having to -- if they didn't remember to bring their other products with them, they don't have them on their person, if they're reluctant to administer them because there's a needle, these are all time benefits and therapeutic benefits that Anaphylm affords because it's so easy to have on you and carry with you and administer. So we know what our study shows. It looks like it responds very rapidly. We're encouraged by that. Not really aware of similar studies being done in the literature. I'd have to get back to you on that. But we think that this is a very attractive profile given the manifestations of anaphylaxis in the oral cavity.

Okay. So regarding the pediatric data that's going to be presented on November 9, can you contextualize the pediatric PK/PD profile relative to what you saw for Anaphylm in your adult studies?

Sure. Well, the study you mentioned is being presented here at the meeting, and it will basically look at the over 30 kilogram or 17-year-old pediatric population, and the intent was to look at the pharmacokinetic curve and the pharmacodynamic profile in pediatric patients who, as you know the audience knows, are more prone to allergic reactions like this. We will be showing that it indeed does provide a robust pharmacokinetic and pharmacodynamic response. And when we compare that data to the data that we generated in adults in our pivotal study, the curves are virtually overlapping, which gives us confidence again that this product is going to be a very viable alternative for the pediatric population as well.

We have one question that someone on the line sent to me. And going back to oral swelling, I guess do you have enough exposure? I think there's 2 oral swells and 2 tongue swells. Is that enough, so to speak, for the FDA to get comfortable here?

Well, these are small studies. As you imagine, recruiting patients to expose them to an oral allergen is maybe not everybody's favorite experience. All we can do is look at the proportion of the data set that we had in the 30-some-odd patients that were in the study. But we did not see -- the 25% of them who did experience those oral manifestations, the resolution of them was so rapid that we don't think that, that's going to be any different if we had a much larger population, because basically you're administering epinephrine right on to the location where the oral swelling is occurring. So there probably is -- I'm speculating here, there probably is some local effect directly on the edematous area in the mouth. So that area probably would be the fastest and most responsive to sublingual administration.

Sure. I wanted to switch gears and talk about repeat dosing. Just help us better understand the body of repeat dosing data here. And specifically, I'm interested in how to think about the need for repeat dosing in clinical practice and how that compare with the extent to which we see repeat dosing for the currently available rescue modalities.

Right. Good question. So I think it's important -- a couple of things. One is, the repeat dosing study that was done basically gave a second dose to everybody. That's actually very different than what would happen in the real-world setting when the literature suggests that only about 10% to 20% of subjects would continue to have symptoms that were not sufficiently controlled and therefore, would want and need to take a second dose. So essentially, you -- this is what we would call a forced titration study. And so you're not -- it's unlikely we would see elevations in the PK levels that we saw in this study because it's not how it would be administered in the real-world setting. The effect of the second dose, the adverse event profile, the durability and the pharmacodynamic effects are all within a safe range based on existing clinical parameters. So we're not concerned, and we're not seeing severe adverse reactions as a result of the second dose. To be honest with you, probably the people who need a second dose would be the people who did not have a robust response to the first dose. And so their levels are going to tend to be lower than some of the values that might occur in a forced titration study.

Okay. So let's move on to commercialization or commercial readiness. So my next set of questions are for Sherry. And I'll start with a question about the sales force. Can you just remind us how you're thinking about sales force headcount, the headcount for other personnel such as MSLs, and how many prescribers you intend to call on initially?

Sure. Thanks so much. As you have probably heard me say in the past, the epinephrine market is one that is an inch deep and about 10,000 miles wide. Why is that? Well, the prescribers range from primary care physicians who write 1 or 2 prescriptions, refills annually, to the allergists who prescribe more than 200 prescriptions per year. Because allergists are so productive and because the pediatricians and the PCPs look to see what the specialists, i.e., the allergist prescribes, our initial focus will be in that allergy space. That will be about 5,000 clinicians, and our sales force will be sized to call on that prescriber base. So you can be thinking that we'll launch with a sales force in the range of 50 to 60 reps and managers. Again, that will allow us to have not only the depth of coverage of the allergists, but also be able to reach them frequently. We are in the process of hiring our sales managers, and we will hire our specialty sales representatives upon approval. And so we have been really building our commercial team, making sure that we have individuals with significant launch experience with allergy experience as we bring them into the commercial organization. As it relates to others, a medical team, as I'm sure you can imagine, is critically important. And as we think about MSLs, we have recently brought on 2 more MSLs, and we will look to increase by a few more early next year.

So the next question I have is on pricing. And I know you get this a lot, and probably not a ton you could say, but I'd ask it anyway.

Yes, of course. I wouldn't expect anything less.

So yes, I mean, I guess the way to ask it is just in general, how are you thinking about it? I mean, obviously, this is an innovative product, but with the reality that EpiPen has a generic and there's generic pricing here. And we all know what Neffy is priced at. So as you think about these dynamics in broad strokes, I guess, how do you think about pricing?

Yes, it's a good question. And we haven't disclosed our WAC price. We won't do that until we're ready to launch. And as you also said, we believe there is significant value in our innovation. However, we do also believe in a patient-first approach to pricing, and we must price responsibly. So with that being said, if you think about the branded market, Auvi-Q, branded EpiPen and Neffy, the market has pretty much been set by the currently available epinephrine products. And so we understand the challenges patients have for access. And so we'll be -- what we're exploring and we're just completing some additional pricing and payer research as we speak, we'll look to see what the payers are telling us and think about it in that range of the branded epinephrine products. Now obviously, we are committed to patient access, and we want to ensure broad access. So that is everything from a cash pay, a cash price, co-pay savings programs, ensuring that we get the broadest coverage for Anaphylm over time, setting up a support hub for doctors and patients. And so we'll have a broad range of options available for patients and caregivers to take advantage and accessing Anaphylm.

So what kind of learnings are you using from the rollout of Neffy that could inform both your promotional strategy and also your payer strategy?

It's a really good question. I think it's the #1 question of the day. So look, I think it's always important. When you're in a second -- in position #2, you kind of have that fast follower advantage to look at what has the brand right in front of you done well, where were there some gaps and hiccups, and how do you make it better? So we get to see in front of us what they went through. So we are constantly systematically assessing and gathering insights from the recent launch. So I think, first and foremost, payers. Our market access and clinical team has been actively engaging with payers. We're conducting payer research, understanding what went well with Neffy, what maybe didn't go so well. And we're confident that we're going to achieve broad coverage over time. But it takes time. And just as you've seen with ARS, it's going to take time. But we do believe, over a period of time, we'll be competitive with the other branded products in the space. I think some other things that if you think about it from a promotional perspective, as we look at the size of the sales force, it will be quite different. And why is that? We have a differentiated product, and we're taking a differentiated focused approach towards our launch. And part of that is being very disciplined in how we roll out the product. So again, coming back to we're going to call on the most productive physicians with a sales force that is rightsized for those specialists. Over time, we'll give ourselves the opportunity to scale. As market access comes on, we will scale as we are selling more, as more physicians and consumers are aware, we will be able to scale. So I always say it's easier to scale than it is to go the other way. And so we're making a very conscious choice to start small and build as opposed to what the competitors did is to go out really big and then have to manage through that. So I think you'll see another difference in our marketing tactics and our go-to-market plan is it will be, again, very focused versus broad brushed and trying to hit everyone. In all the years I've been doing this, in relaunching EpiPen, having all the learnings from growing a brand, a 30-year-old brand at the time from a few hundred million to over $1 billion is that there is time and place for everything. And so in a situation where you're launching a new drug, it's not a device, and it is clearly differentiated from an efficacy, ease of use, ease of carry perspective, we've got to make sure that doctors know about the product, right? And we're getting that market access, and then we are engaging with the consumers. This is a highly driven consumer market. But again, time and place for everything. I think it would be inappropriate for us to think about a big TV campaign in year 1. So those are just some general thoughts as we think about what we've learned from the Neffy launch and what we will be doing similarly as well as differently.

So you mentioned DTC. I think you've answered the part of my question of what your approach will be early in the launch. But I wanted to get your thoughts on what your approach to DTC will be longer term. There is a place for it. We know that. But I would imagine you're not going to see Anaphylm commercials play sort of all over the airwaves like you see for mass market products that you see during sporting events and TV shows. But there is a place for DTC in the setting. So how do you think about Anaphylm DTC longer term?

Yes. Look, Anaphylm is a consumer-driven product. We absolutely believe in the value of consumer awareness and education for Anaphylm. We will launch with consumer materials. DTC is -- everybody, when you say DTC, I think we all think of TV ads, but it's much broader than that, right? It's digital nonpersonal promotion. It is journal ads for the physician, it is magazine ads for the consumer. And look, there's a lot of really cool things that are going on out there in the market that is not as expensive as running TV. With that being said, our prelaunch awareness campaign is really focused on the HCP with CME, non-CME pubs, congresses. And then as we think about launching, we will be driving that message to caregivers, the moms that are the Chief Medical Officers, because, again, it is a consumer-driven market. I think what you can expect to see is digital, nonpersonal promotion, office promotion for patient awareness, but the TV, obviously, we'll wait. We'll look at all of the options as we're doing our planning for 2027 in TV, connected, et cetera. But again, that will scale with time.

Okay. So let's move on to sales force expansion beyond the initial rollout and presumably, there will be a time and a place for that. But will your headcount expansion be sort of informed by success. In other words, success begets expansion, expansion begets more success and so on and so forth. Is that the way you think about it?

Yes. I think it's like an avalanche. You start to get -- our initial focus is going to be in that allergist space. The sales force will be sized to call on that prescriber base. Over time, as adoption grows and payer access increases, we will look to scale. And so the allergists are so excited, as Dan mentioned on the call this morning, I mean, the feelings are really palpable. When I was here yesterday and this morning walking around, I mean, people are really, really -- doctors are very excited about Anaphylm. And so, again, as we go, we will scale. There are payer restrictions and certain states have a lot of challenges from a payer and a physician access perspective. And so we -- again, I feel very strongly about our choice, and it's a very disciplined choice to start with that allergist, get the specialists writing. The specialists, the pediatricians, they're very, very slow to adopt, for obvious reasons, and that's of any product, but layering in the pediatricians, ENTs and the large primary care physicians over time. So yes, you can expect to see that over time with sales performance and market access.

Great. So I wanted to move on to Anaphylm supply chain readiness. So next set of questions are for Cassie. So just talk generally about the building out of commercial supply.

Yes. So thanks for that question. I mean, look, this is an area of great experience for us, right? In our over 2 decades of existence, right, more than half of those have been focused on manufacturing, right? And I think as you heard Dan talk about this morning in the earnings call, this year alone, we'll do 150 million doses. So we put out over 2 billion doses of Anaphylm product around the world, right? So we're well situated when it comes to the manufacturing and building supply and have experience in launches, right? And again, as you heard Dan talk about earlier this year -- this morning, we've done a lot of work in establishing critical vendors that are part of the process that are all U.S.-based. We've got long-standing relationships with them. So I think when you put that together along with our experience, we feel really well positioned around the commercial supply.

Okay. And then in terms of prescription fulfillment, can you talk about the extent to which you'll lean on specialty pharmacies? Or will most prescriptions just get filled by retail pharmacies? How should we think about that?

Yes. I think that's probably one that Sherry will talk a little bit about.

I'm sorry, David, can you repeat that?

Yes. Just to the extent to which you will lean on specialty pharmacies or prescriptions just be filled by good old-fashioned retail channels.

Yes. So this market is -- I mean, it is predominantly retail, right, the corner of health and happiness. However, as we have learned from looking at many other products that are written in the allergists' office, having a specialty pharmacy channel is important. And so we will look to -- we are planning to have a specialty pharmacy and that will be aligned with our hub.

Okay. So in the next few minutes we have left, I just want to go through financial update. So first, Ernie, with the raise recently, just talk through your cash runway.

So we feel we're in a very good place as a company as far as the capital structure now. In the third quarter, we did 2 major financings. First, we did an $85 million equity raise, which was led by RTW and brought in a group of high-quality health care investors into the company that we've never had before. Concurrently with that, we did, with RTW, a revenue interest financing on Anaphylm that brings another $75 million into the company, subject to 2 conditions it's based on, one, approval of Anaphylm and two, that we refinanced our existing debt. And as I also mentioned in my script this morning, we are out trying to refinance the debt. We've found the market to be just very receptive to our financing right now. And we hope that in the near future, we will be able to announce a refinancing of our existing debt with, again, another high-quality institutional health care lender that people will recognize. So you take all 3 of them together and maybe some additional capacity under our debt, it provides us runway through '27. It gets us through this year of all the pre-commercial work that Sherry is doing next year; if approved, the ramp-up of the sales force and all of the spend that we've talked about. And again, based -- really depends on the uptake and also level of spend, but it definitely extends the runway through 2027. It does not take into account any licensing, for example, European licensing of Anaphylm, which we could possibly do, we've talked about. That runway doesn't include any other financings that we possibly could do, again, based on market conditions, uptake. There's a whole lot of factors there. So we really feel good about where the company is today from a capital structure. We get this debt financing done. That will be the third leg for this year, and then we're off to the races.

Obviously, you're nicely funded for the launch. So can you talk about initial launch spend and how we should think about next year and the spend and really the ramp in spend on Anaphylm commercial support as the product launches?

So we haven't given any guidance for 2026 yet. But if we think about what we have said publicly on the commercial spend and what Sherry said, we're not hiring one sales rep until we have approval. We get approval, the offers will spring forward. We would expect within 30 days to have that sales force on. So end of first quarter, the sales force is on, that's when we will begin to see the impact of that spend. So I think we then would see in the second -- and the number of reps would be, as we said, 50 to 60 reps. In the second and third quarter, you would probably see additional commercial spending as the allergy season ramps up, that's prime season, and that's when we would see a higher spend there. So I think we'll see it ramp up definitely end of first quarter through second and third quarter, and then maybe a little bit lower as we get to the year, end of the year. But we feel that we're well prepared for a successful launch if approved by the FDA.

What about the longer-term commercial support of Anaphylm in terms of spend? I mean, at some point, there will be operating leverage. I mean -- and obviously, that's going to depend on kind of what kind of sales ramp you have, of course. But just thinking about the commercial model, how are you thinking about growth in spend longer term and the extent to how quickly you can start to really see operating leverage?

I think as we go out, we -- 2026 is the build and launch year, 2027, again, depending on the ramp and the uptake, you would see expansion. And I think as we get later into 2027, early 2028 is when you would begin to see the leverage. And maybe -- again, I don't want this to be considered any type of guidance, but maybe mid-2028, you would begin to see that leverage come to fruition.

Okay. So there's sort of, well, a couple of broader questions outside of Anaphylm. I mean when you have Libervant, it's there. And that's a nice product category. But is that an asset you're looking to monetize?

I think with Libervant, we've always said it's a very good product. Overriding everything is to make sure it gets into patients' hands. So people who need the product. And as we've always said, we evaluate if it's best in someone else's hands and somebody comes to us with a compelling offer, we would definitely be interested in talking to them. But look, next year, our primary focus is the successful launch of Anaphylm, if approved. And trying to divert attention to preparing to commercialize Libervant might be a stretch for the company, but we got to see where we're at.

And a broader question regarding balancing, reaching sustainable profitability, but also moving forward with other programs. You have your epinephrine prodrug platform. I think you talked this morning about your alopecia areata program. So that's certainly going to move forward. But you've talked to other potential programs where you can leverage your epinephrine prodrug platform. So I guess, how do you balance the goal of reaching sustainable profitability with these R&D goals where you can leverage this technology?

It is a balancing act of -- we're trying to do a lot here with commercializing Anaphylm and also, again, investing in the future, the future of the company with our AdrenaVerse platform and in particularly 108. So it's something we are constantly looking at. We're fortunate, as we've done these capital transactions, to now have a more available cash to invest. But still, we need to make sure that we're balancing all the resources in the company, not just cash, to be able to focus on the commercial efforts, the research and development efforts and the manufacturing efforts. So hopefully, as we move forward into '26, we'll be able to address all those issues.

And then last question. I think you touched on it, Ernie, on ex U.S. But just high level, just other geographies where you're thinking about partnering out. Obviously, there's Canada, there's Europe, there could be other geographies. But where do things stand in terms of ex U.S. and how you're thinking about that for Anaphylm?

For Anaphylm, I think probably the first priority would most likely be Europe. We've seen the transaction that the nasal spray did for Europe. It was a very good deal. And I think it's something we continue to think about and explore. And I think time will tell on where that goes and if there are other territories that would either come first or right after a deal like that.

Okay. Well, we are at the top of the hour here. So I will leave it there, but I really appreciate what was an expansive discussion, and my thanks to the team here for taking the time. And we certainly will look forward to the presentations at ACAAI. And so we'll leave it there. But thanks, Aquestive team, and thanks, everyone, listening in, and hope you all have a great rest of the day.

Thanks, David. Appreciate the opportunity to spend time with you today.

All right. Thank you.