Milestone Pharmaceuticals Inc. ($MIST)

Good morning, ladies and gentlemen, and welcome to the Milestone Pharmaceuticals Fourth Quarter and Year-End 2025 Corporate Update Conference Call. [Operator Instructions] As a reminder, this conference is being recorded. I will now turn the call over to your host, Michael Wood of LifeSci Advisors. You may now begin your conference.

Thank you, operator, and good morning, everyone, and welcome to the Milestone Pharmaceuticals Full-Year 2025 Financial Results and Business Update Conference Call. Earlier this morning, the company issued a press release providing an overview of its financial results for the year ended December 31, 2025, and recent corporate highlights. The release can be accessed on the Investors and Media section of the company's website, milestonepharma.com. Before I begin, I'd like to remind everyone that some of the information presented on this conference call contains forward-looking statements under the securities laws. These forward-looking statements involve substantial risks and uncertainties that could cause actual clinical programs, future results, progress, timing, performances or achievements to differ materially from those expressed or implied by such forward-looking statements. These risks and uncertainties associated with Milestone's business and factors that could cause or contribute to such differences are described in detail in the company's filings with the SEC, including in the Risk Factors section of the earnings report on Form 10-K for the year ended December 31, 2025, filed with the SEC today. Speaking on the call this morning will be Joseph Oliveto, President and Chief Executive Officer; Lorenz Muller, Chief Commercial Officer; Amit Hasija, Chief Financial Officer and EVP of Corporate Development. In addition, Dr. David Bharucha, the company's Chief Medical Officer, will also be available during the Q&A session. So I'd now like to turn the call over to Joseph Oliveto. Joe, please go ahead.

Thank you, Michael. Good morning, and welcome, everyone, to our 2025 year-end earnings call. December 2025 marked a transformational event for Milestone Pharmaceuticals with the FDA approval of CARDAMYST, etripamil nasal spray for paroxysmal supraventricular tachycardia or more specifically for the conversion of PSVT to normal sinus rhythm in adults. Milestone is entering an exciting new phase of growth as we focus on bringing this important new therapy to patients and building a strong commercial franchise. The FDA approval of CARDAMYST was the culmination of years of clinical development and scientific commitment. And as such, I'd like to reiterate my appreciation and thank all the people who helped make this happen. This includes the clinical-trial investigators and clinical support staff; our partners who conducted the various clinical, manufacturing, and regulatory programs; the patients who participated in the studies; and of course, my colleagues here at Milestone, who put in the hard work and dedication to bring us to where we are today. We see the FDA approval of CARDAMYST as a foundation for value-creation. Let me expand on what I mean. First, our commercial team is now executing on the launch of CARDAMYST, the first new therapeutic option in 30 years for more than 2 million patients with PSVT. Our goal is that this new product will become a trusted and essential tool for health care providers and their patients. Our commercial strategy this year is focused on driving new-patient starts and achieving commercial coverage, which, if successful, is expected to accelerate prescription growth. The strategy also includes ensuring patients have a good initial experience with CARDAMYST. We were successful in having CARDAMYST available in the market in late January, approximately 6 weeks after approval, and we began our promotional launch a few weeks later by mid-February. While we're only about a month or so into the launch, we are very encouraged about the initial feedback from prescribers, and Lorenz will be providing more details on what we are seeing regarding the launch later in this call. Second, we believe the FDA approval of CARDAMYST will enable us to leverage our comprehensive clinical data and seek marketing approvals in other parts of the world. The regulatory process here in the U.S. is seen as the gold standard, and we believe that having an FDA approval adds to the credibility of CARDAMYST. We filed a marketing authorization application, or MAA, for etripamil nasal spray, or TACHYMIST, as it will be known in Europe in the fourth quarter of 2025. We announced the EMA's acceptance of that application in January, and we are engaged with the reviewers, and we expect that review and a decision from that review to occur in the first half of 2027. Moving on to our finances. Milestone Pharmaceutical is well-capitalized, and we are reporting today a strengthened balance sheet that we believe supports a successful launch of CARDAMYST and provides us with expected operating runway into late 2027. We are reporting a pro forma estimated cash figure of $200 million. This includes the year-end audited cash and cash equivalents and short-term investments, plus the funds we received in early 2026 from the RTW royalty payment, exercises of a portion of the warrants from our last financing, and the sale of shares through our ATM program. The figure does not include estimated burn to date in Q1. Amit Hasija, our CFO, will provide the details on our financials later in the call. And lastly, we recently enhanced our leadership team with the addition of David Sandoval to the position of General Counsel and Chief Compliance Officer. David has an established track record with more than 15 years leading legal and compliance functions across the life-sciences sector. We believe this experience will be extremely valuable as we scale our operations and build the infrastructure to support long-term growth. With that, I'd like to turn the call over to Lorenz for some additional color on the launch.

Thank you, Joe, and thank you to all of you for joining us this morning on our update. From a commercial perspective, we're excited to be underway bringing CARDAMYST or etripamil nasal spray to patients who have not had a new treatment option for literally decades. CARDAMYST is the first FDA-approved, self-administered therapy specifically designed for acute PSVT treatment. Many patients with PSVT often rely on emergency departments for acute care. CARDAMYST is an intranasal treatment option supported by robust efficacy and safety data that patients can administer themselves at the onset of symptoms. Our commercial strategy is focused on targeting high-prescribing cardiologists, electrophysiologists, and advanced practice providers who manage PSVT. With our sales force of approximately 60 representatives, we are targeting around 10,000 providers who we estimate will manage half of the 1 million patients with PSVT who will receive treatment for their condition in 2026. In support of these efforts, we have also been proactively engaging with payers to demonstrate the value proposition of CARDAMYST for PSVT, including the potential to reduce costly emergency department visits and hospital utilization. We believe the PSVT market represents a clearly-defined opportunity within cardiovascular specialty pharma, and our commercialization plan is designed to drive early trial and usage and achieve broad coverage while establishing a durable franchise in acute arrhythmia management. So let me now update you on the positive momentum we're seeing in the market during these early stages of the launch of CARDAMYST. Overall, we are confident in and excited about the first few months since the approval, driven by 3 achievements. First, as Joe said, we made CARDAMYST conveniently available to patients through retail pharmacies across the country within 6 weeks of FDA approval. Second, we hired, trained and deployed our national sales force within 2 months, enabling them to start delivering thousands of details per week by the middle of February. And finally, we have ample evidence that ahead of contracted coverage, our investments in reimbursement support are all online and functioning as we had intended, helping providers to write and patients to fill prescriptions. These early achievements are important because they directly support the 3 pillars of commercial success that you've heard me talk about in the past. And those are making CARDAMYST easily accessible and affordable for patients, making CARDAMYST easy to prescribe for providers; and limiting the need for payers to actively manage the use of CARDAMYST. So, let's now drill down into the actual launch. While it's still very early, what we are seeing at this stage supports our confidence. Prescriptions are being written, wholesalers are ordering replenishment product, and patients are walking out of pharmacies with CARDAMYST in hand, strongly suggesting that retail distribution is working. On the demand-generation side, our sales force is delivering well over 1,000 engagements with targeted providers each week, showing that they can get in front of high-value customers just a month into the promotional launch. In this first month of promotion, we've seen over 150 prescriptions filled, generated by over 100 unique prescribers. Most of the prescriptions filled to date are new-patient starts and have been written by providers who are targeted by our sales force. We believe that these numbers give us an early indication that our sales operations have good initial functionality. In the future, and as our promotional efforts progress, I will continue to report on prescriptions and prescribers, including total prescriptions, unique prescribers and new-patient starts, as well as update on contracted coverage by payers. On the coverage front, as I mentioned a few minutes ago, we have data to indicate that our reimbursement-support architecture is working, even without contracted coverage in place yet. Prescriptions are being written, prior authorizations are being prepared, medical exceptions are being submitted, and there has been inbound activity on our reimbursement-support line. The investments we made to help facilitate script fulfillment early on in launch are working in the way we designed them. As an example of this, I want to share an anecdote of a nationally known electrophysiologist whose name you would all recognize, wanted to prescribe CARDAMYST for one of his patients. His first 2 attempts to fill the prescription at retail pharmacies failed, but once he tapped into Milestone Support Services with the help of his local sales rep, he was able to get the patient CARDAMYST that same day. For each successful case study, however, there are at least an equal number of examples where we know of demand from a doctor, but the normal rigors of insurer controls block or delay access to the patient receiving the drug, despite the physician's desire for their patient to have it. We continue to work on pull-through of these scripts, both by supporting physicians' office staff, with assistance in completing the prior authorization or medical exception paperwork and, of course, by working toward gaining coverage. This natural dampening of prescription fills and buildup of prescriptions in queue for eventual filling is fully within our expectations based on our extensive pre-launch interactions with payers. Let me give you some details of the support systems we have in place to help patients in advance of contracted coverage. CARDAMYST launched with the support of a patient assistance platform as we continue to negotiate with insurers for formulary placement and coverage. The program provides benefits-verification, reimbursement support, and co-pay assistance for eligible patients with commercial insurance that covers CARDAMYST, reinforcing Milestone's commitment to making CARDAMYST affordable for patients who need it. So, in summary, our strategy in this launch year is to demonstrate that there is real demand for CARDAMYST. To achieve this, we will continue to focus on ensuring that physicians want to and can prescribe CARDAMYST, patients can access and afford the product, and payers can see real demand building in the marketplace. While we are now about a month into the launch, it's too early to comment on trends or identify durable patterns, especially because we do not yet have contracted coverage in place. So, we are encouraged by what we are seeing, but not extrapolating yet from very early launch data. We see the current period as being informative but not yet representative. In the coming months, we expect prescription volume to increase and commercial coverage to expand over time, with more meaningful progress in the back-half of the year, and that should further support the launch trajectory. I'll now turn the call over to Amit to review the financials.

Thank you, Lorenz. We recognized $1.5 million in milestone revenue in the fourth quarter and full-year of 2025. There is no revenue comparables in 2024. That full-year revenue reflects the milestone earned under our licensing collaboration agreement with Corxel following FDA approval in the U.S. for CARDAMYST in PSVT. R&D expense, net of tax credits was $5.5 million in the fourth quarter of 2025, compared to $3.9 million in the fourth quarter of 2024. For the full-year, R&D expense was $18.1 million compared to $14.4 million in 2024. The year-over-year increase was primarily due to higher consulting and outside services costs, partially offset by lower personnel-related costs. G&A expense was $5.1 million in the fourth quarter of 2025, compared to $4.0 million in the prior quarter. For the full-year, G&A expense was $17.3 million, compared to $16.7 million in 2024. The increase was primarily driven by higher outside-service costs and higher personnel costs. Commercial expense was $8.2 million in the fourth quarter of 2025, compared to $4.4 million in the fourth quarter of 2024. For the full-year, commercial expense was $28.3 million, compared to $11 million in 2024. This increase primarily reflects additional personnel costs, professional costs, and other operational costs associated with preparation for the launch of CARDAMYST. Net loss for the fourth quarter of 2025 was $17.4 million, or $0.16 per share, compared to $12.4 million, or $0.19 per share, in the fourth quarter of 2025. For the full-year, net loss was $63.1 million, or $0.75 per share, compared to $41.5 million, or $0.67 per share in 2024. As of December 31, 2025, we had $106 million in cash, cash equivalents, and short-term investments. On January 12, 2026, we closed the sale of the royalty interest under our Royalty Purchase and Sale Agreement with RTW and received $75 million in cash in exchange for the royalty interest in CARDAMYST. Subsequent to year-end, we also raised approximately $10.9 million in net proceeds through our previously announced at-the-market offering program and received a further $8 million in net proceeds through the exercise of warrants. Taking these additional funds into account gives us a pro forma cash number of approximately $200 million. We believe this supports a successful launch of CARDAMYST and provides us with expected operating runway into late 2027. I'll now turn the call over to Joe Oliveto for some concluding statements.

Thank you, Amit. We at Milestone Pharmaceuticals believe we are well positioned at a pivotal moment. With CARDAMYST, we have the opportunity to change how paroxysmal supraventricular tachycardia is treated, empowering patients with a self-administered option, reducing reliance on emergency department care, and establishing leadership in acute cardiovascular therapy. That concludes our prepared remarks, and we'll now open up the call to questions.

[Operator Instructions] Our first question today is coming from Ritu Baral from TD Cowen.

This is Athena Chin on for Ritu Baral. A couple of questions on the CARDAMYST launch. How has feedback been to date between the different prescribers that you're targeting? And where are you seeing the most adoption? And on coverage, what are the leading reasons for coverage denial?

Yes. Great to hear you, Athena. Thanks for taking the time to hear the update. And with regard to prescribers, we're actually seeing a broad mix across cardiology, electrophysiology. And as Lorenz had mentioned, specifically in the script, the APPs who are the nurse practitioners and physicians' assistants. I think we've guided even before the approval that we thought that the APPs would be a key group for this product. They're very engaged with the patient and hearing from the patient even between visits. So we're seeing a breadth across those specialty groups. And then I think your second question was...

Reasons for coverage denial.

Reasons for coverage denial. Yes, it's a bit of a mix right now and it's early days, I would say. So each plan is basically just has a basic kind of block-until-review, I would say, is what we're seeing most. And what that translates to is a lot of paperwork for confirmation that this could be a patient that could be applicable for CARDAMYST -- extra paperwork on? Do they have PSVT? Have they had events? Have they visited the emergency department? Those are some examples of what we see, and those were expected.

Next question today is coming from Ted Tenthoff from Piper Sandler.

Congrats on the launch, really, really exciting times for the company. Picking up on that last question, how long is it taking for reimbursement to kick in? And what is Milestone doing to make sure patients get drug in that delay period? How does that work? Or are they getting drug and it's just they then have to kind of fight to get it paid for? And then secondly, when it comes to supply, what can you tell us about manufacturing supply and how that side of the business is looking?

Great question, Ted. Great to hear your voice. How long is the interesting question; when you only launch for a week -- for a month rather, you only have 4 weeks of data. And yes. So, I would say the example that Lorenz gave is a great one, right? They tried twice and then they engage the system. And -- and then once you engage the system, we've seen scripts filled within days. We've seen scripts filled within weeks. And 4 weeks in, we've seen a few scripts not filled yet. We're still working on them. So there is this natural dampening. Again, I think we even targeted and signaled to the Street what it is for the industry, which is -- before you get approval and you have to go through medical exceptions, the benchmarks tell us that more than half of the scripts are not filled, okay? So that is the benchmark that we have in our head, and we're trying to beat that, obviously, with our programs, which dovetails into the second part of your question, which is what are we doing. So we have the Patient Support System. We do have our sales representatives guide largely the APPs and the office managers that's available to them. But remember, we're out there also trying to build awareness of the drug. So we're trying to do all this in the same calls and repeat calls. We have co-pay assistance programs, both in the form of co-pay cards, which give us a little bit more data on how these patients are doing and whether they're getting the drug or not. We also have electronic systems at the pharmacies where we're yet to see the data on. That data is just lagged by a good month or so. So we haven't seen any of that data yet. So, compartmentalize with the question and the uncertainty around how long it takes is we just need time for these datasets to come in. A lot of them are informative on a case-by-case basis, which I don't want to get into with the investors, but that's the value of what we're doing now. Having 3 or 4 different programs online allows us to see on a case-by-case basis, which ones work, which ones work in which areas of the country and then allows us to be prepared to like move the dial on different programs depending on what we see.

And then the last question was just on supply.

Right. Yes. No, supply, we're still in -- we're well prepared. We still have supply left over even from the R&D efforts. So those batches are available and being pulled through and out into the market. And we've already gotten on to a routine cadence of next batches going forward. So all working well on the supply side.

Our next question today is coming from Brandon Folkes from H.C. Wainwright.

On all the progress. A few from me. Understanding it's very early on in the launch, but I thought I'd ask this. Given it is early, do you have any sense of when CARDAMYST is being prescribed currently, what it is replacing? Is it the pill-in-the-pocket? Is it newly-diagnosed patients? Just any color there would be helpful. And then maybe secondly, I'll just ask this with it because granted, I don't know how much data you have at this stage. But in terms of early real-world feedback, have you heard of any patients having an episode post-having CARDAMYST? And if that has happened, has it worked as anticipated?

Yes. Great questions. I don't have great feedback on a specific patient group that's getting it. It is broad. We have heard of -- so there's not going to be any trends here, but some examples. We have heard of patients getting it before an ablation. We've heard of patients getting it just as a routine course of they've been waiting for it. And those patients, as we've mentioned before approval, Brandon, run the gamut. 2/3 of them are on background medications. A fair number of them have a pill-in-the-pocket in their purse or in their desk drawer, whether they use it or not is a question mark. So we've heard all those examples, but again, too early to say anything that's leading per se right now. I think we're very bullish on the fact that this drug could be used across a whole host of patients, and it really depends on what the APP or the physician believes is best for them. Your second question is really interesting. We're waiting to hear from those patients of having used it and the excitement we know we're going to get. We know that because we heard it from the clinical trials. I will say, though, we have -- as you can imagine, we do pretty heavy social listening out there. So, we're on top of what's being said, if you will, on the various pages that these patients talk about. And our support group also speaks to patients. Now, I don't have that data, but I do -- on the social-media side, have really uplifting beliefs because even before they treated with CARDAMYST, there was just excitement to get it. And remember, Brandon, we always talk about there's 2 burdens for this condition. One is when you're in it and your heart is going 200 beats a minute or so and you're feeling it and you have those symptoms. The other burden is when you're not in a condition, but you know there's one coming; you just don't know when, what you're going to be doing, and how bad it's going to be. That's the piece that these patients on the social-chatboards are really, I think, speaking to. The fact that they have it and they have, if you will, this comfort or peace of mind to have something. That's been uplifting from -- even we saw some of this before we even announced the drug was available. We saw patients getting the drug and being excited about simply having it. I've never had that in my career.

Do you mind if I just sneak one more in. Just on reimbursement, can you remind us of your contracting strategy here. Do you expect to contract early on in the launch ahead of perhaps significant demand? Or given the strength of where your balance sheet is today, are you thinking of perhaps creating significant demand through the Patient Assistance Program and then contracting a little bit later in the launch where you have that demand to put in front of payers?

Thanks, Brandon. Our strategy has been very clear. We want to drive to coverage because no matter how many programs we put in place until we get coverage, it is a natural dampening as we identified before, more than half of your scripts don't get through. That's the industry benchmark. We would like to get out of that world as soon as we can and be reasonable about, obviously, the types of contracts we put in place. Our strategy is clearly focused on commercial first. We think we can get those first, and we're very actively engaging payers right now for both commercial and Medicare. It's just the natural lead times to Medicare are longer. So we've always guided to Medicare being more of a '27 type of achievement and commercial starting in '26. We don't guide exactly to when it will start because there are a lot of things outside of our control. But what I will say is we're very encouraged by the discussions we're having with those commercial plans. They are within expectations of what they told us before we got the approval. Remember, we've had 2 years of engagement with these plans, showing them the Budget Impact Models, and it's just a matter now of getting on their schedules. but no surprises from what we can see so far. Again, early, early days on anything related to how they're thinking about the product.

Congrats on the really good progress.

[Operator Instructions] Our next question is coming from Dennis Ding from Jefferies.

This is Anthea on for Dennis. Congrats on the progress so far. I wanted to follow up on the prior question regarding contracting strategy. Could you talk a little bit more about what does good formulary positioning look like for CARDAMYST? And how much rebate pressure should we expect as you push for broader access? And then separately, what is the patient-mix in terms of coverage in terms of commercial versus Medicare?

Great. Great to hear you, Anthea. Thanks for taking the time out today. So with regard to what good coverage looks like for us, we view it and we've guided pre-approval, and we still guide to -- we want pretty open access, things like Prior Auth to-label and attestation of the patient being treated for PSVT that's expected type of coverage we would like to see, that would be good. We've also guided the Street to -- the biggest question for payers is not at all the medical need. They see that clearly. They see the benefits of this to their plan. The biggest question they have is how often will it be used by the patient. And we provided guidance that this is a drug that's used a handful of times per year. They just may want some comfort there. So we've heard of and we would expect good coverage to include, at least in the launch year or 2, quantity limits and not onerous ones; like the ones that would prevent it from being used instead of 5 times per year being used 50 times a year, right? That's what they want to avoid. So quantity limits, Prior Auth to-label is kind of the standard down the fairway type of coverage we've got it to. And again, that's an average. There will be some plans that are more harsh and some plans that are more open, but that's an average good quality coverage for us with standard pay-to-play type of discounts. With regard to the Commercial and Medicare breakdown, roughly think of it as 50-50. It's about 50% under 65 and about 50% over 65.

We reached end of our question-and-answer session. I'd like to turn the floor back over to Joe for any further closing comments.

Well, I really love this is our first earnings call since the approval, and we're reporting on, I guess, the period before we actually launched. So it is early days, but I'm really excited. I'm really thankful for all of the people that have called in here and support of the company. And I want to really just convey that we're super excited to be now doing earnings calls going forward. We'll look forward to updating you on a quarterly basis, as Lorenz had said, on how the launch is going and the progress of the company. So with that, I wish everyone a great rest of the day.

Thank you. That does conclude today's teleconference and webcast. You may disconnect your line at this time, and have a wonderful day. We thank you for your participation today.