Q3 2025 SIGA Technologies Inc Earnings Call

Speaker #3: Welcome to the cigar business update . Call . Before we turn the call over to cigar management , please note that any forward looking statements made during this call are based on management's current expectations and observations , and are subject to risks and uncertainties that could cause actual results to differ from the forward looking statements .

Speaker #3: Cigar does not undertake any obligation to update publicly any forward looking statement to reflect events or change circumstances . After this call for a discussion of factors that could cause results to differ , please see the company's filings with the Securities and Exchange Commission , including , without limitation , the company's annual report on Form 10-K for the year ended December 31st , 2020 .

Speaker #3: Four , and its subsequent reports on Form 10-q and form 8-K . With that , I will turn the call over to Diem Nguyen Chief Executive Officer of Sega .

Speaker #3: Them .

Speaker #4: Good afternoon , everyone , and thank you for joining today's call . And review of our business results for the third quarter of 2025 .

Speaker #4: I joined by Daniel Luckshire , our chief Financial officer , and we appreciate this opportunity to provide an update on our company . After the update , we'll be happy to answer your questions .

Speaker #4: With nine months of the year behind us , we've continued to make progress across several key initiatives in line with our mission to support governments in building and maintaining robust preparedness plans in the event of a potential smallpox outbreak .

Speaker #4: Whether accidental , deliberate , or naturally occurring . Our work is focused on helping to ensure that in an event of such a crisis , rapid and large scale deployment of antiviral treatments can be accomplished to save lives .

Speaker #4: Having preparedness strategies , particularly for category A threats like smallpox with provisions for stockpiling medical countermeasures , can enable immediate action in today's dynamic and increasingly complex global landscape , bioterrorism continues to be a significant concern .

Speaker #4: Underscoring the importance of proactive preparedness . Tpoxx strong safety profile makes it an ideal choice for mass distribution . Under emergency conditions . The third quarter was relatively quiet , as Sega's financial strength was demonstrated in our strong second quarter performance , which included $79 million of product revenues .

Speaker #4: These quarterly fluctuations are consistent with the nature of Sega's business model , where our financial performance should be assessed beyond quarters . For the nine months ended September 30th of 2025 , product revenue totaled approximately 86 million , including 53 million of oral tpoxx and 26 million of IV tpoxx sales under the 19 .

Speaker #4: See Barda contract with the delivery of US Strategic National Stockpile or SNS , and the 6 million of oral sales to the International customer .

Speaker #4: As of the end of third quarter , there was approximately 26 million of outstanding orders remaining from the US government . This outstanding balance relates to the March 2025 US Government Order of IV Tpoxx , which we expect to deliver in 2026 .

Speaker #4: Importantly , we continue to be engaged with the US government regarding future Tpoxx development , manufacturing and procurement . As a reminder , year to date , Sega has been awarded 27 million for pediatric formulation development and IV tech transfer activities since September , Sega has been actively engaged with the US government regarding the future procurement of Tpoxx .

Speaker #4: While the details of our conversation with government officials remain confidential , we're encouraged by their continued interest in maintaining access to Tpoxx as a critical medical countermeasure for smallpox , particularly amidst the disruption and uncertainty of the ongoing government shutdown .

Speaker #4: Antivirals remain essential for bioterrorism preparedness and play a vital role in any comprehensive plan enabling quick action when it matters most . I'd also like to highlight an additional point of interest our approach to pricing and manufacturing has historically been well aligned with administration's priorities .

Speaker #4: The US government has always received our lowest price for Tpoxx compared to international purchasers and all of our active pharmaceutical ingredients or API , and finished drug product are produced in facilities located in the US .

Speaker #4: On the international side of our business , we continue to have discussions with key stakeholders on critical role biodefense plays in shaping resilient global health security frameworks .

Speaker #4: Our goal is to help ensure that countries around the world are equipped to respond swiftly . Should a smallpox outbreak occur . Given the growing risk of bioterrorism , many countries and regions have developed preparedness strategies and have allocated larger budgets to executing those strategies , while others are working to do so .

Speaker #4: In our view , strategic stockpiling is supported by sustained investment in crisis . Preparedness is critical to global health security . Discussions around potential contracts with both existing as well as new customers are ongoing .

Speaker #4: As we maintain current relationships and look to expand our customer base . Based on our engagements this year and interest from key stakeholders across strategic markets , we expect multiple international sales in 2026 .

Speaker #4: I'd also like to share a brief update on the referral procedure for Tpoxx , known as Tecovirimat Siga . In Europe , commenced by the European Medicines Agency or EMA , in July .

Speaker #4: As we previously explained , the EMA raised questions about our products efficacy in treating mpox following a review of the data from Mpox clinical trials , including palm 007 and Stomp .

Speaker #4: We have submitted comprehensive , science based responses to questions posed by the EMA , which were focused primarily on mpox . The EMA's Committee for Medicinal Products for Human Use or NP , will meet next week , and we expect it will either issue an opinion or request for additional information .

Speaker #4: While we will not speculate on what the CMP will do , we are confident in responses we put forth and believe Tpoxx is a safe and effective drug for its approved indications .

Speaker #4: We remain ready to address any additional questions and provide greater clarity as needed from the Chmp . As always , we encourage stakeholders to view Tpoxx through the lens of the comprehensive data and gravity of the disease is designed to treat , namely smallpox .

Speaker #4: As a reminder , Tpoxx is the highly targeted and was developed as a smallpox treatment with the goal of reducing mortality in pre-clinical trials .

Speaker #4: Tecovirimat significantly reduced mortality and viral load across four pivotal studies in nonhuman primates and two in rabbits . Daci has been demonstrated in about 10,000 tpoxx recipients across more than 20 clinical trials , which is critical when we need it for mass distribution .

Speaker #4: Turning to our late stage pipeline , we continue to advance tpoxx post-exposure prophylaxis program , or Pep , for smallpox collaboration with CDC continues as a reminder , the CDC is analyzing samples collected to support the studies immunogenicity objective .

Speaker #4: Based on Tpoxx mechanism of action , we believe Tpoxx will not have any impact to Jynneos immune response when administered concomitantly with Jynneos .

Speaker #4: Therefore , we continue to move forward toward an FDA submission . While the government shutdown does impact near-term timelines for this project , based on current expectations , we continue to target the FDA submission for the Pep indication in 2026 .

Speaker #4: Also , in our pipeline , our pediatric program continues to move forward in partnership with the Biomedical Advanced Research and Development Authority , or Barda , within the US Department of Health and Human Services .

Speaker #4: Under the administration for Strategic Preparedness and Response , or Aspera . This initiative is designed to address an important unmet need , providing a treatment option for children too small for the current oral formulation of tpoxx , we're targeting to submit an IND as soon as the end of the year with phase one trial targeted to begin shortly thereafter .

Speaker #4: As we approach year end , our key priorities remain unchanged . Sustaining financial strength and executing our strategic initiatives with discipline and focus .

Speaker #4: Despite the expected lumpiness of our financial results , quarter to quarter . Our company continues its track record of generating substantial cash flow since 2020 .

Speaker #4: We've returned approximately 230 million to shareholders in the form of dividends and share buybacks , all while incurring zero debt . We believe our approach continues to position us well for long term success , where our core areas of focus has delivered meaningful long term value for our shareholders .

Speaker #4: In closing , we believe Seagate continues to build on its strong foundation of strategic focus , financial discipline and strength , and long term government partnerships .

Speaker #4: Are differentiated . Tpoxx franchise and history of performance reinforce our path forward . One that supports global health security and creates long term shareholder value .

Speaker #4: With that, I'll turn it over to Dan to review the financial results in more detail. Dan.

Speaker #5: Thanks , M . As noted earlier in the call , Seagate's product sales for the nine months ended September 30th , 2025 are approximately $86 million , including $53 million of oral tpoxx and $26 million of sales under the 19 .

Speaker #5: See Barda contract and $6 million of oral Tpoxx sales to an international customer. The sales under the 1970 contract relate to Tpoxx deliveries to the U.S. Strategic National Stockpile, or SNS.

Speaker #5: Product sales for this time period outpaced sales of the comparable period last year of $54 million . In addition to product sales , the company has research and development revenues of approximately $5 million .

Speaker #5: For the nine months ended September 30th , 2025 , with respect to the three months ended September 30th , 2025 , as mentioned , it was a relatively quiet quarter , which follows a strong second quarter in which the company had $79 million of product revenues .

Speaker #5: As previously noted , given the nature of the business model of IGA , fluctuations in revenue amounts between quarters is not unusual . As a supplemental note , there are $26 million of remaining outstanding orders as of September 30th .

Speaker #5: This amount reflects the $26 million of IV pox order received in the first quarter of this year . Under the 19 Barda contract , which is targeted for delivery in 2026 .

Speaker #5: Pre-tax operating income for the nine months ended September 30th , 2025 , which excludes interest income and taxes , is approximately $33 million for the three months ended September 30th , 2025 .

Speaker #5: Pre-tax operating loss is approximately $10 million . Net income for the nine months ended September 30th , 2025 is approximately $29 million . In turn , fully diluted income per share for this period is $0.40 per share for the three months ended September 30th , 2025 .

Speaker #5: Net loss is approximately $6 million and net loss per share is $0.09 . The company continues to maintain a strong balance sheet . That September 30th , 2025 , the company had a cash balance of approximately $172 million and no debt .

Speaker #5: This concludes the financial update . At this point , I will turn the call back to Zeb .

Speaker #4: Thank you . Dan . With that , we'd like to open the call up for questions .

Speaker #3: Ladies and gentlemen , should you have a question , please press star followed by one on your touchtone phone . You will hear a prompt that your hand has been raised .

Speaker #3: Should you wish to remove your hand from the queue , please press star followed by two . If you're using a speakerphone , please lift the handset before pressing any keys .

Speaker #3: Just a moment for your first question . And your first question comes from JT Prakash at Edison Group . Please go ahead .

Speaker #6: Hi . Good evening and thank you for taking my questions . My first question is related to the US RFP process for Tpoxx .

Speaker #6: You mentioned disruptions with the US government and the reasons shutdowns . What kind of potential impact , if any , do you see on the ongoing RFP process and the timelines for Tpoxx stockpiling ?

Speaker #7: Thanks. It’s nice to hear from you. We are fortunate at this time that the headcount reductions, as well as furloughs, have not materially impacted operational activities or the performance of our existing government contracts.

Speaker #7: Many of the people we work with continue to engage , given the nature of what they do , as well as the importance of national security .

Speaker #7: There are some instances in which activities with the government employees outside Barda have been impacted , and these cases the impact has not been material to our operational operations to date .

Speaker #7: The one area that we would like to highlight that we do see some impact is with the CDC . There is a possibility of delays in the CDC completing the completing the analysis of our samples from the trials supporting our Pet program .

Speaker #7: The CDC was originally targeting to complete analysis later this year , and that could potentially slip given the timelines of the government shutdown .

Speaker #7: I mean , regarding the new procurement contract for Tpoxx , as we noted in our prepared remarks , we continue to engage with the government officials regarding Tpoxx development , manufacturing and procurement .

Speaker #7: While the headcount reductions for furloughs do expose contractors to some potential delays and occasional choppiness in terms of customary interactions , we believe the key drivers of the procurement activity will be ultimately driven by the views and actions of leadership within the US government , and this includes Aspr , HHS , DoD , as well as administration , as well as Congress .

Speaker #7: Over the long term . I mean , we are we are encouraged by their continued interest in maintaining access to Tpoxx , as we believe .

Speaker #7: And they do , too , that it's a critical countermeasure for smallpox .

Speaker #6: Thank you . And would you continue to be in active dialogue with the US government ? But if you just hypothesize that the RFP may be slightly delayed , are there any mitigation strategies or operational steps with Siga ?

Speaker #6: Is looking to implement or can implement to secure the long term , longer term outlook ? Obviously , your cash position remains strong , so nearer term may not be as much of a concern .

Speaker #8: Hi Jodie , this is Dan . I'll take that question . You're right in that you mentioned that we have a strong cash position and just to reiterate , it's 172 million at September 30th and there's no debt .

Speaker #8: So we are in a very strong position just to give you a frame of reference , that cash balance is more than four times the current annual rate or annual run rate for operating expenses .

Speaker #8: So that affords us , you know , a lot of flexibility . And so what I would say generally is given this position , I would just generally say that over the past decade , Siga has been consistently adapted different environments .

Speaker #8: And and we'll continue to be adaptive . You know , with an eye toward , you know , finding the best mix of pursuing opportunities and managing risks .

Speaker #6: Thank you . Thank you for that . And I just have another couple of questions on the financials . We appreciate that . Q3 was a slightly quieter quarter for the company , but you did record .

Speaker #6: Point 9 million of product revenues . Can you elaborate on what these revenues came from . And are they related to the CD .

Speaker #6: And for instance , and secondly , we saw that the cost of goods as a percentage of sales was relatively higher in this quarter versus what we've seen in the previous quarters .

Speaker #6: Can you just explain what could be the reasons for this ?

Speaker #8: Right , right . So in a quarter like this , you know , do then you sort of have sort of some technical outcomes that don't necessarily reflect any type of trend .

Speaker #8: What you're seeing on the revenue side is really the way the accounting works is certain in limited circumstances . And certain certain types of reimbursement activities or are treated as product revenues .

Speaker #8: And that really ties into the , for example , the Ivy tech transfer . So that's what you see on the product revenue side .

Speaker #8: And then on the on the corresponding cost of goods sold . You see the expenses related to it , what you also see is that a lot of cost of goods , as you would expect , are variable costs related to production costs for inventory .

Speaker #8: But there is a small amount , percentage wise that's attributable to sort of semi fixed costs , such costs or expenses , such as stability , storage , security and even when we don't want it to quite quarter , we don't really have much in the way of product deliveries .

Speaker #8: We still have those expenses show up each quarter . So that's what you also see coming through the cost of goods sold . So that's why you sort of see , you know , when you look at it on a margin basis , the margin is very different than what you normally see .

Speaker #8: But again , I would highlight that this is more of a technical outcome . And that does not reflect any type of trend .

Speaker #6: Thank you . That's that's very clear . And I don't have any further questions . So thank you for taking all my questions .

Speaker #3: Thank you . As a reminder , if you wish to ask a question , please press star one . There are no further questions at this time .

Speaker #3: I'm pleased to turn the call back over to them .

Speaker #7: Thanks , Marissa . I'd like to thank everyone for making the time to join today's call , and for your ongoing interest in Siga .

Speaker #7: We look forward to speaking to you again in our fourth quarter call . Have a great evening .