Q4 2025 HLS Therapeutics Inc Earnings Call

March 12, 2026

Speaker #2: Following the presentation, we will conduct a question-and-answer session. If at any time during this call you require immediate assistance, please press star zero for the operator.

Speaker #2: This call is being recorded on Thursday, March 12th, 2026. At this time, I would like to turn the call over to David Mason, Investor Relations, for the introductory remarks.

Dave Mason: Thank you, Joelle. Good morning, everyone, and thanks for joining us today. With me on the call is Craig Millian, Chief Executive Officer, John Hanna, Chief Financial Officer, and Brian Walsh, Chief Commercial Officer. Earlier this morning, we issued a news release announcing our financial results for the three and twelve months ended December 31, 2025. This news release, along with our MD&A and financial statements, is available on our website and on SEDAR+. Please note that slides accompanying today's call can be viewed via the webcast, a link to which is available in our earnings release and on our website on the Events page. Certain matters discussed in today's conference call or answers that may be given to questions could constitute forward-looking statements. Actual results could differ materially from those anticipated.

Speaker #2: Thank you, Joelle. Good morning, everyone, and thanks for joining us today. With me on the call are Craig Millian, Chief Executive Officer; John Hanna, Chief Financial Officer; and Brian Walsh, Chief Commercial Officer.

Speaker #2: Earlier this morning, we issued a news release announcing our financial results for the three and twelve months ended December 31, 2025. This news release, along with our MD&A and financial statements, is available on our website and on Cedar Plus.

Speaker #2: Please note that slides accompanying today's call can be viewed via the webcast. A link to which is available in our earnings release and on our website in the events page.

Speaker #2: Certain matters discussed in today's conference call or answers that may be given to questions could constitute forward-looking statements. Actual results could differ materially from those anticipated.

Dave Mason: Risk factors that could affect results are detailed in the company's annual information form, which has been filed on SEDAR+. During the call, we will refer to adjusted EBITDA. Adjusted EBITDA does not have any standardized meaning prescribed by IFRS. Adjusted EBITDA is defined in our press release and annual filings that are available on SEDAR+ and on our website. Please note that all financial information provided is in US dollars unless otherwise specified. I would now like to turn the meeting over to Mr. Millian. Please go ahead.

Speaker #2: Risk factors that could affect results are detailed in the company's annual information form, which has been filed on Cedar Plus. During the call, we will refer to adjusted EBITDA, adjusted EBITDA does not have any standardized meaning prescribed by IFRS, adjusted EBITDA is defined in our press release and annual filings that are available on Cedar Plus and on our website.

Speaker #2: Please note that all financial information provided is in US dollars, unless otherwise specified. And I would now like to turn the meeting over to Mr. Millian.

Speaker #2: Please go ahead. Thanks, Dave. Good morning, everyone, and thank you for joining us today. On our call today, I'll review Q4 in 2025 performance highlights, the progress we've made against our priorities for the year, and our path going forward.

Craig Millian: Thanks, Dave. Good morning, everyone, and thank you for joining us today. On our call today, I'll review Q4 and 2025 performance highlights, the progress we've made against our priorities for the year, and our path going forward. Brian will drill down further on product performance along with an update on our cardiovascular franchise expansion. John will follow with a detailed look at the numbers. After our prepared remarks, we'll hold a Q&A session. In 2025, HLS made considerable progress against our objectives to drive profitable growth, strengthen our balance sheet, and lay the foundation for future growth via portfolio expansion. I'll structure my remarks today around three key themes we introduced earlier last year, and then Brian and John will expand upon them. First, driving operating performance within our base business. Second, building a leading Canadian-based cardiovascular franchise with the additions of NILEMDO and NEXLIZET.

Speaker #2: Brian will drill down further on product performance along with an update on our cardiovascular franchise expansion. John will follow with a detailed look at the numbers.

Speaker #2: After our prepared remarks, we'll hold a Q&A session. In 2025, HLS made considerable progress against our objectives to drive profitable growth, strengthen our balance sheet, and lay the foundation for future growth via portfolio expansion.

Speaker #2: I'll structure my remarks today around three key themes we introduced earlier last year, and then Brian and John will expand upon them. First, driving operating performance within our base business.

Speaker #2: Second, building a leading Canadian-based cardiovascular franchise with the additions of Nalendo and Nexlizet. And third, the strengthening of our financial foundation which in turn increases optionality to deploy capital.

Craig Millian: Third, the strengthening of our financial foundation, which in turn increases optionality to deploy capital. Let's start with a look at our Q4 and full year business performance. Revenue in the quarter was $15.2 million and $55.5 million for the full year. Excluding the impact of foreign exchange and a drop in royalty revenues, product sales grew 1% for the year. Adjusted EBITDA for the quarter was $5.7 million and $19.6 million for the full year, achieving 18% growth for the full year. Strong growth in adjusted EBITDA reflects our balanced approach to driving product performance while also optimizing spend. Importantly, we're now seeing signs that the changes we made in 2025 with our cardiovascular sales force are working.

Speaker #2: Let's start with a look at our Q4 and full-year business performance. Revenue in the quarter was $15.2 million, and $55.5 million for the full year.

Speaker #2: Excluding the impact of foreign exchange and the drop in royalty revenues, product sales grew 1% for the year. Adjusted EBITDA for the quarter was $5.7 million and $19.6 million for the full year, achieving 18% growth for the full year.

Speaker #2: Strong growth in adjusted EBITDA reflects our balanced approach to driving product performance while also optimizing spend. Importantly, we're now seeing signs that the changes we made in 2025 with our cardiovascular sales force are working.

Craig Millian: Vascepa unit demand grew 23% for the year, and importantly, there was a positive inflection in the second half in new-to-brand prescriptions. For the first time, Vascepa made a positive contribution to adjusted EBITDA for the full year. Greater operating efficiency, along with progress in delevering our balance sheet, also drove improved cash flow in 2025. Net debt declined 23% in 2025, while cash from operations for the full year was $17.1 million, up 114% compared to 2024. As it relates to our overall operating performance, we executed on our 2025 business plan and met our most recent full-year guidance targets. The second theme I'd like to touch on is the build-out of the HLS cardiovascular franchise in Canada.

Speaker #2: The CIPA unit demand grew 23% for the year, and importantly, there was a positive inflection in the second half in new-to-brand prescriptions. And for the first time, the CIPA made a positive contribution to adjusted EBITDA for the full year.

Speaker #2: Greater operating efficiency along with progress in delivering our balance sheet also drove improved cash flow in. 2025. Net debt declined 23% in 2025, while cash from operations for the full year was 17.1 million dollars, up 114% compared to 2024.

Speaker #2: As it relates to our overall operating performance, we executed on our 2025 business plan and met our most recent full year guidance targets. The second theme I'd like to touch on is the build-out of the HLS cardiovascular franchise in Canada.

Craig Millian: In May last year, we announced the Canadian in-licensing of NILEMDO or bempedoic acid and NEXLIZET, a pill that combines bempedoic acid with ezetimibe. In November, we received approval from Health Canada for NILEMDO, while the application for NEXLIZET remains in progress. The addition of NILEMDO alongside Vascepa and eventually NEXLIZET positions HLS as a leading Canadian-based company focused on cardiovascular risk reduction. These medicines are a strong strategic fit within our portfolio and represent the type of assets we've been targeting through our business development efforts. NILEMDO and NEXLIZET are available in countries throughout the world where they already generate $ hundreds of millions in global annual sales. Successfully launching these medicines into Canada is mission-critical to driving the next phase of growth for HLS. Of note, commercializing these products will not require additional headcount as we leverage our existing sales force and organizational capabilities.

Speaker #2: In May last year, we announced the Canadian in-licensing of Nalendo, or Bempidog Acid, and Nexlizet, a pill that combines Bempidog Acid with ezetimibe. In November, we received approval from Health Canada for Nalendo.

Speaker #2: While the application for Nexlizet remains in progress, the addition of Nalendo alongside the CIPA and eventually Nexlizet positions HLS as a leading Canadian-based company focused on cardiovascular risk reduction.

Speaker #2: These medicines are a strong strategic fit within our portfolio and represent the type of assets we've been targeting through our business development efforts. Nalendo and Nexlizet are available in countries throughout the world, where they already generate hundreds of millions of dollars in global annual sales.

Craig Millian: Successfully launching these medicines into Canada is mission-critical to driving the next phase of growth for HLS. Of note, commercializing these products will not require additional headcount as we leverage our existing sales force and organizational capabilities.

Speaker #2: Successfully launching these medicines into Canada is mission-critical to driving the next phase of growth for HLS. Of note, commercializing these products will not require additional headcount as we leverage our existing sales force and organizational capabilities.

Craig Millian: From a timing perspective, NILEMDO is now commercially available as we made our first wholesaler shipments and booked our first sales just this month. We will have a full commercial launch with our sales force in early April and expect to see a ramp in prescribing uptake at that time. For NEXLIZET, we are actively engaging with Health Canada to provide the additional information they've requested and are targeting an approval by early 2027. Let me outline why we believe the NILEMDO and NEXLIZET opportunity may not be fully appreciated and why we're so excited about the potential for this franchise. First, the addressable market. We estimate that roughly half a million Canadians could benefit from treatment with bempedoic acid. These are patients who either cannot tolerate adequate statin doses or who remain above their LDL cholesterol targets despite treatment with statins and ezetimibe. Second, the clinical profile.

Speaker #2: From a timing perspective, Nalendo is now commercially available, as we made our first wholesaler shipments and booked our first sales just this month. We will have a full commercial launch with our sales force in early April and expect to see a ramp in prescribing uptake at that time.

Speaker #2: For Nexlizet, we are actively engaging with Health Canada to provide the additional information they've requested, and are targeting an approval by early 2027. Let me outline why we believe the Nalendo and Nexlizet opportunity may not be fully appreciated, and why we're so excited about the potential for this franchise.

Craig Millian: First, the addressable market. We estimate that roughly half a million Canadians could benefit from treatment with bempedoic acid. These are patients who either cannot tolerate adequate statin doses or who remain above their LDL cholesterol targets despite treatment with statins and ezetimibe. Second, the clinical profile. The CLEAR Outcomes trial demonstrated compelling cardiovascular risk reduction with NILEMDO. This isn't just an LDL-lowering agent. It's a medicine with proven outcomes data that fits squarely within the existing treatment paradigm.

Speaker #2: First, the addressable market. We estimate that roughly half a million Canadians could benefit from treatment with Bempidog Acid. These are patients who either cannot tolerate adequate statin doses or who remain above their LDL cholesterol targets despite treatment with statins and ezetimibe.

Speaker #2: Second, the clinical profile. The clear outcomes trial demonstrated compelling cardiovascular risk reduction with Nalendo. This isn't just an LDL-lowering agent. It's a medicine with proven outcomes data that fits squarely within the existing treatment paradigm.

Craig Millian: The CLEAR Outcomes trial demonstrated compelling cardiovascular risk reduction with NILEMDO. This isn't just an LDL-lowering agent. It's a medicine with proven outcomes data that fits squarely within the existing treatment paradigm. Third, the value proposition. At a list price of CAD 4.25 per day, NILEMDO represents significant value compared to injectable medicines which cost a multiple of that amount. Combining bempedoic acid, ezetimibe, and a statin can achieve a magnitude of LDL reduction comparable to PCSK9s at a fraction of the cost and with an all-oral regimen. Fourth, the unit economics. Based on expected net pricing, we anticipate strong margins, and by leveraging our existing cardiovascular infrastructure across multiple products, the overall CV franchise will become more profitable.

Craig Millian: Third, the value proposition. At a list price of CAD 4.25 per day, NILEMDO represents significant value compared to injectable medicines which cost a multiple of that amount. Combining bempedoic acid, ezetimibe, and a statin can achieve a magnitude of LDL reduction comparable to PCSK9s at a fraction of the cost and with an all-oral regimen. Fourth, the unit economics. Based on expected net pricing, we anticipate strong margins, and by leveraging our existing cardiovascular infrastructure across multiple products, the overall CV franchise will become more profitable.

Speaker #2: Third, the value proposition. At a list price of $4.25 Canadian per day, Nalendo represents significant value compared to injectable medicines which cost a multiple of that amount.

Speaker #2: Combining bempedoic acid with ezetimibe and a statin can achieve a magnitude of LDL reduction comparable to PCSK9s at a fraction of the cost, and with an all-oral regimen.

Speaker #2: Fourth, the unit economics. Based on expected net pricing, we anticipate strong margins. And by leveraging our existing cardiovascular infrastructure across multiple products, the overall CV franchise will become more profitable.

Craig Millian: Within the targeted patient population, which is a small subset of the much larger statin universe, even a conservative market share assumption could potentially translate into annual sales in the range of CAD 50 to 100 million. This represents a substantial growth opportunity that should more than double the size of our cardiovascular business. Brian will speak more to the benefits of our staged approach to launching NILEMDO and then NEXLIZET as we see multiple catalysts unfolding over the next 12 to 24 months that should drive sustained growth. The third theme I want to highlight is our strengthening financial position, which will provide greater flexibility for future growth. We continue to take a balanced approach to capital allocation with the priority of pursuing business development opportunities while also paying down debt and repurchasing our stock.

Speaker #2: Within the targeted patient population, which is a small subset of the much larger statin universe, even a conservative market share assumption could potentially translate into annual sales in the range of 50 to 100 million Canadian.

Speaker #2: This represents a substantial growth opportunity that should more than double the size of our cardiovascular business. Brian will speak more to the benefits of our staged approach to launching Nalendo and then Nexlizet, as we see multiple catalysts unfolding over the next 12 to 24 months that should drive sustained growth.

Craig Millian: The third theme I want to highlight is our strengthening financial position, which will provide greater flexibility for future growth. We continue to take a balanced approach to capital allocation with the priority of pursuing business development opportunities while also paying down debt and repurchasing our stock.

Speaker #2: The third theme I want to highlight is our strengthening financial position, which will provide greater flexibility for future growth. We continue to take a balanced approach to capital allocation with the priority of pursuing business development opportunities while also paying down debt and repurchasing our stock.

Craig Millian: John will talk about the significant progress we've made paying down debt and lowering our interest expense over the past year. Regarding share buybacks, the NCIB remains a key component in our capital allocation plan. Certain restrictions have limited recent activity, but we continue to see compelling value at current prices and expect to resume buying when able. Now that we have our financial house in good order, we are in a strong position to increase our focus toward expansion and growth. Our base business is stable and profitable. Our balance sheet is strong. We have a major new product launch ahead of us, and we have the financial flexibility to pursue additional portfolio expansion. Our disciplined BD approach is to target assets in the US and Canada that may be available at a reasonable cost and that can potentially drive meaningful top-line growth while leveraging our existing infrastructure and capabilities.

Speaker #2: John will talk about the significant progress we've made paying down debt and lowering our interest expense over the past year. Regarding share buyback, the NCIB remains a key component in our capital allocation plan.

Speaker #2: Certain restrictions have limited recent activity, but we continue to see compelling value at current prices and expect to resume buying when able. Now that we have our financial house in good order, we are in a strong position to increase our focus towards expansion and growth.

Craig Millian: Our base business is stable and profitable. Our balance sheet is strong. We have a major new product launch ahead of us, and we have the financial flexibility to pursue additional portfolio expansion. Our disciplined BD approach is to target assets in the US and Canada that may be available at a reasonable cost and that can potentially drive meaningful top-line growth while leveraging our existing infrastructure and capabilities.

Speaker #2: Our base business is stable and profitable. Our balance sheet is strong, we have a major new product launch ahead of us, and we have the financial flexibility to pursue additional portfolio expansion.

Speaker #2: Our disciplined BD approach is to target assets in the US and Canada that may be available at a reasonable cost and that can potentially drive meaningful top-line growth while leveraging our existing infrastructure and capabilities.

Craig Millian: We also remain open to the possibility of a strategic transaction to more rapidly build scale and create shareholder value. Looking now at our financial guidance for 2026, we expect to deliver revenue of $56 to 60 million, which is mid-single digit percentage growth, and adjusted EBITDA of $18.5 to 21 million, which is relatively flat to 2025. This guidance reflects some growth from our base business, along with conservative NILEMDO sales expectations, and the investment needed for a successful launch. After making substantial cuts to cardiovascular spend over the past 2 years, we now plan a modest increase to ensure we don't under-invest in critical launch activities. That said, we fully expect the cardiovascular business overall to increase its positive contribution toward adjusted EBITDA in 2026. However, the real growth story accelerates beyond 2026.

Speaker #2: We also remain open to the possibility of a strategic transaction to more rapidly build, scale, and create shareholder value. Looking now at our financial guidance for 2026, we expect to deliver revenue of $56 to $60 million, which is mid-single-digit percentage growth.

Speaker #2: And adjusted EBITDA of $18.5 to $21 million, which is relatively flat to 2025. This guidance reflects some growth of our base business along with conservative Nalendo sales expectations.

Speaker #2: And the investment needed for a successful launch. After making substantial cuts to cardiovascular spend over the past two years, we now plan. Modest increase to ensure we don't under-invest in critical launch activities.

Craig Millian: That said, we fully expect the cardiovascular business overall to increase its positive contribution toward adjusted EBITDA in 2026. However, the real growth story accelerates beyond 2026.

Speaker #2: That said, we fully expect the cardiovascular business overall to increase its positive contribution toward adjusted EBITDA in 2026. However, the real growth story accelerates beyond 2026.

Craig Millian: With continued Vascepa growth, the 2026 launch of NILEMDO, with expanded public payer access starting in 2027, and then the anticipated launch of NEXLIZET in 2027, we expect to see more meaningful revenue and earnings expansion in 2027 and beyond. This is before we consider any potential upside from our business development efforts. In summary, we've built the foundation over the past 2 years that now positions us to drive sustained profitable growth in the years ahead. With that, I'll turn it over to Brian to provide more detail on our commercial performance and our expanded cardiovascular portfolio. Brian?

Speaker #2: With continued the CFA growth, the 2026 launch of Nalendo, with expanded public payer access starting in 2027, and then the anticipated launch of Nexlizet in 2027, we expect to see more meaningful revenue in earnings expansion in 2027 and beyond.

Speaker #2: And this is before we consider any potential upside from our business development efforts. In summary, we've built a foundation over the past two years that now positions us to drive sustained profitable growth in the years ahead.

Craig Millian: With that, I'll turn it over to Brian to provide more detail on our commercial performance and our expanded cardiovascular portfolio. Brian?

Speaker #2: With that, I'll turn it over to Brian to provide more detail on our commercial performance and our expanded cardiovascular portfolio. Brian.

Brian Walsh: Thanks, Craig, and good morning, everyone. I'll start with an update on Clozaril performance across both markets. In the US, 2025 saw the benefits of our specialty pharmacy program initiative, which helped to partially offset patient attrition in other channels. We continue to see strength of this program into Q1 of 2026, with potential to further drive stabilization of Clozaril in the US. In Canada, as we discussed on the last call, we faced some pressure in Ontario due to the new GPO arrangements with certain hospital accounts during 2025. While there was increased competitive activity, we successfully retained our largest and most strategic hospital accounts and maintained our position as the leading supplier in Ontario.

Speaker #3: Thanks, Craig. And good morning, everyone. I'll start with an update on Clauserl performance across both markets. In the US, 2025 saw the benefits of our specialty pharmacy program initiative, which helped to partially offset patient attrition in other channels.

Speaker #3: We continue to see strength of this program into Q1 2026, with potential to further drive stabilization of Clauserl in the US. In Canada, as we discussed on the last call, we face some pressure in Ontario due to the new GPO arrangements with certain hospital accounts during 2025.

Speaker #3: While there was increased competitive activity, we successfully retained our largest and most strategic hospital accounts and maintained our position as the leading supplier in Ontario.

Brian Walsh: Looking ahead to 2026, we anticipate some further revenue pressure from those 2025 renegotiations, but we believe these headwinds are manageable and expect the Ontario business to stabilize as we move through this year. Across our other Canadian markets, we're seeing positive developments. We continue to gain share in Western and Atlantic Canada and maintain strong patient retention in Quebec. Importantly, Clozaril remains the only approved treatment option for treatment-resistant schizophrenia, and we continue to see opportunities to increase utilization with this difficult-to-treat patient population. Turning to Vascepa, we made purposeful changes to strengthen our HLS team during 2025, both at the field leadership and sales representative levels, and we are now seeing the benefits of those changes.

Speaker #3: Looking ahead to 2026, we anticipate some further revenue pressure from those 2025 renegotiations but we believe these headwinds are manageable and expect the Ontario business to stabilize as we move through this year.

Speaker #3: Across our other Canadian markets, we're seeing positive developments. We continue to gain share in Western and Atlantic Canada and maintain strong patient retention in Quebec.

Speaker #3: Importantly, Clauserl remains the only approved treatment option for treatment-resistant schizophrenia and we continue to see opportunities to increase utilization with this difficult-to-treat patient population.

Speaker #3: Turning to the CFA, we made purposeful changes to strengthen our HLS team during 2025. Both at the field leadership and sales representative levels. And we are now seeing the benefits of those changes.

Brian Walsh: Personnel changes did lead to some short-term disruptions in customer engagement in impacted sales territories earlier in 2025, but we have now moved past those disruptions and saw strong performance in key metrics in Q4. On the demand side, unit growth for the quarter was 19%, and for the full year was 23%. Reflecting the positive changes to our sales force, we saw a growth inflection in new patient starts not observed since prior to the Pfizer separation. Of note, the delta between Vascepa unit growth and revenue growth in Q4 is primarily a function of payer mix and the timing of shipments for year-end orders. With all the changes we've made over the past year, our focus has been on driving profitable growth.

Speaker #3: Personnel changes did lead to some short-term disruptions in customer engagement and impacted sales territories earlier in 2025. But we have now moved past those disruptions and saw strong performance in key metrics in Q4.

Speaker #3: On the demand side, unit growth for the quarter was 19%, and for the full year was 23%. Reflecting the positive changes to our sales force, we saw a growth inflection in new patient starts not observed since prior to the Pfizer separation.

Speaker #3: Of note, the delta between the CFA unit growth and revenue growth in Q4 is primarily a function of payer mix and the timing of shipments for year-end orders.

Speaker #3: With all the changes we made over the past year, our focus has been on driving profitable growth. We are improving the profitability of the product and for the full year 2025, the CFA made a positive contribution to adjusted EBITDA.

Brian Walsh: We are improving the profitability of the product, and for the full year 2025, Vascepa made a positive contribution to adjusted EBITDA. As a result of our improved co-pay assistance program and our increased focus on the private payer segment, we're also seeing stabilization in our payer mix in Ontario and Quebec, which is also helping to improve overall profitability for the brand. Now let me turn to our exciting NILEMDO opportunity, which represents a transformational addition to our cardiovascular portfolio. NILEMDO fills a gap between generic statins and ezetimibe and more costly injectable PCSK9s. This positioning is particularly favorable in Canada, where patient access to PCSK9s is highly restricted.

Speaker #3: As a result of our improved copay assistance program and our increased focus on the private payer segment, we're also seeing stabilization in our payer mix in Ontario and Quebec, which is also helping to improve overall profitability for the brand.

Brian Walsh: Now let me turn to our exciting NILEMDO opportunity, which represents a transformational addition to our cardiovascular portfolio. NILEMDO fills a gap between generic statins and ezetimibe and more costly injectable PCSK9s. This positioning is particularly favorable in Canada, where patient access to PCSK9s is highly restricted.

Speaker #3: Now that we've turned our exciting Nalendo opportunity, which represents a transformational addition to our cardiovascular portfolio. Nalendo fills a gap between generic statins and ezetimibe and more costly injectable PCSK9s.

Speaker #3: This positioning is particularly favorable in Canada, where patient access to PCSK9s is highly restricted. As Craig shared, we will launch Nalendo at a list cost of $4.25 Canadian per day, which creates an opening in a very clearly defined patient population for Nalendo as an oral, well-tolerated, and cost-effective treatment.

Brian Walsh: As Craig shared, we will launch NILEMDO at a list cost of CAD 4.25 per day, which creates an opening in a very clearly defined patient population for NILEMDO as an oral, well-tolerated, and cost-effective treatment. We conducted blinded market research in late Q4 with targeted Canadian cardiologists and endocrinologists. The results showed very high levels of aided and unaided brand awareness, which demonstrated that most of our targets are already familiar with NILEMDO. Importantly, the survey also showed strong intent to prescribe for patients not at goal on a statin or intolerant to statins. We also held an in-person national advisory board of top specialists from across Canada earlier this year. This provided our teams with valuable feedback as we finalize our launch plans, but also reinforced for us that specialists across Canada see significant unmet need and are eager to add NILEMDO to their armamentarium.

Speaker #3: We conducted blinded market research in late Q4 with targeted Canadian cardiologists and endocrinologists. The results showed very high levels of aided and unaided brand awareness which demonstrated that most of our targets are already familiar with Nalendo.

Speaker #3: Importantly, the survey also showed strong intent to prescribe for patients not at goal on a statin or intolerant to statins. We also held an in-person national advisory board of top specialists from across Canada earlier this year.

Brian Walsh: We also held an in-person national advisory board of top specialists from across Canada earlier this year. This provided our teams with valuable feedback as we finalize our launch plans, but also reinforced for us that specialists across Canada see significant unmet need and are eager to add NILEMDO to their armamentarium.

Speaker #3: This provided our teams with valuable feedback as we finalize our launch plans, but it also reinforced for us that specialists across Canada see significant unmet need and are eager to add Nalendo to their armamentarium.

Brian Walsh: NILEMDO is now available at wholesalers, and we are on track to begin promoting it with our sales force in early April. Since our last call, we have submitted our reimbursement dossiers to CDA, formerly known as CADTH, as well as to private payers. We expect meaningful private payer coverage to be achieved over the next several months. Public sector discussions will continue throughout 2026, targeting provincial listings by early 2027. For NEXLIZET, as Craig said, we are working towards securing approval and launching in the first half of 2027. The stage launch of NILEMDO followed by NEXLIZET works in our favor for several reasons. One, clinicians know bempedoic acid from the CLEAR Outcomes as a single agent, so launching NILEMDO first builds the brand foundation. Second, most will prescribe NILEMDO as an add-on therapy initially.

Speaker #3: Nalendo is now available at wholesalers, and we are on track to begin promoting it with our sales force in early April. Since our last call, we've submitted reimbursement dossiers to the CDA, formerly known as CADF, as well as to private payers.

Speaker #3: We expect meaningful private payer coverage to be achieved over the next several months. Public sector discussions will continue throughout. 2026 targeting provincial listings by early 2027.

Brian Walsh: For NEXLIZET, as Craig said, we are working towards securing approval and launching in the first half of 2027. The stage launch of NILEMDO followed by NEXLIZET works in our favor for several reasons. One, clinicians know bempedoic acid from the CLEAR Outcomes as a single agent, so launching NILEMDO first builds the brand foundation. Second, most will prescribe NILEMDO as an add-on therapy initially.

Speaker #3: For Nexalzet, as Craig said, we are working towards securing approval and launching in the first half of 2027. The staged launch of Nalendo followed by Nexalzet works in our favor for several reasons.

Speaker #3: One, clinicians know bempedoic acid from the clear trial as a single agent. So launching Nalendo first builds the brand foundation. Second, most will prescribe Nalendo as an add-on therapy initially.

Brian Walsh: Clinicians typically want experience with a novel molecular entity before they consider a combination pill. Third, this approach also gives us multiple catalysts. April 2026, NILEMDO launch, followed by provincial listings in 2027 and NEXLIZET approval and commercial launch in the first half of 2027. Finally, from a reimbursement perspective, since NEXLIZET is essentially NILEMDO plus generic ezetimibe, we can likely converge the timelines rather than run separate reimbursement processes. In closing, with NILEMDO, NEXLIZET, and Vascepa, we'll lead cardiovascular risk reduction in Canada with an all-oral portfolio. With that, I'll turn it over to John for a detailed look at our financial performance. John?

Speaker #3: Clinicians typically want to gain experience with the novel molecular entity before they consider a combination pill. Third, this approach also gives us multiple catalysts: April 2026 Nalendo launch, followed by provincial listings in 2027, and Nexalzet approval and commercial launch in the first half of 2027.

Speaker #3: Finally, from a reimbursement perspective, since Nexalzet is essentially Nalendo plus generic ezetimibe, we can likely converge the timelines rather than run separate reimbursement processes.

Brian Walsh: In closing, with NILEMDO, NEXLIZET, and Vascepa, we'll lead cardiovascular risk reduction in Canada with an all-oral portfolio. With that, I'll turn it over to John for a detailed look at our financial performance. John?

Speaker #3: In closing, with Nalendo, Nexalzet, and the CFA, we'll lead cardiovascular risk reduction in Canada with an all-or-all portfolio. With that, I'll turn it over to John for a detailed look at our financial performance.

John Hanna: Thank you, Brian, and good morning, everyone. In my section, I'll focus on Q4 and full year results and the progress made to strengthen our balance sheet and improve capital allocation flexibility. Starting with revenue. Total revenue for Q4 was $15.2 million, compared to $15.5 million last year. For the full year, total revenue was $55.5 million, compared to $56.6 million in 2024. Canadian product sales of Vascepa and Clozaril in Q4 were CAD 16.2 million, and for the full year were CAD 59.2 million in local currency. This represented a 1.5 increase for the full year. US Clozaril sales in Q4 were $3.3 million, and for the full year were $12.4 million.

Speaker #3: John?

Speaker #1: Thank you, Brian. And good morning, everyone. In my section, I'll focus on Q4 and full-year results, and the progress made to strengthen our balance sheet and improve capital allocation flexibility.

Speaker #1: Starting with revenue, total revenue for Q4 was $15.2 million, compared to $15.5 million last year. For the full year, total revenue was $55.5 million, compared to $56.6 million in 2024.

Speaker #1: Canadian product sales of the CFA and Clozaril in Q4 were $16.2 million, and for the full year were $59.2 million, in local currency. This represented a 1.5% increase for the full year.

Speaker #1: US Clozaril sales in Q4 were $3.3 million, and for the full year were $12.4 million. This represents a 1.6% decrease for the full year, which is a considerable improvement over the four-year average annual decline of 6% and reflects the efforts to mitigate attrition that Brian described earlier.

John Hanna: This represents a 1.6% decrease for the full year, which is a considerable improvement over the 4-year average annual decline of 6% and reflects the efforts to mitigate attrition that Brian described earlier. Finally, royalty revenue was $0.7 million for the full year compared to $1.5 million in 2024. On the expense side, we continue to show progress, reducing our cost base, helping to drive strong margin and cash flow performance. Q4 operating expenses comprising sales and marketing, medical, regulatory, patient support, and G&A were $6.8 million, down 6% compared to Q4 last year. For the full year, operating expenses were $25.8 million, down 17% compared to 2024. This demonstrates the positive impact of the operational efficiency efforts we made in 2024 and continued through 2025.

Speaker #1: Finally, royalty revenue was $0.7 million for the full year, compared to $1.5 million in 2024. On the expense side, we continue to show progress reducing our cost base.

Speaker #1: Helping to drive strong margin and cash flow performance. Q4 operating expenses comprising sales and marketing, medical regulatory and patient support, and G&A were $6.8 million, down 6% compared to Q4 last year.

Speaker #1: For the full year, operating expenses were $25.8 million, down 17% compared to 2024. This demonstrates the positive impact of the operational efficiency efforts we made in 2024 and continued through 2025.

John Hanna: Cost of sales in Q4 was $2.6 million and for the full year was $10.1 million, with the full year increase largely due to demand growth in Vascepa. Q4 adjusted EBITDA was $5.7 million, up 3% compared to Q4 last year. For the full year, adjusted EBITDA increased 18% to $19.6 million. Excluding royalty revenue, the full year increase would have been 24%. For Q4, the direct brand contribution of Clozaril to adjusted EBITDA was $7.7 million, while the direct brand contribution of Vascepa to adjusted EBITDA was $0.3 million. For the full year, the contributions for Clozaril and Vascepa were $26.9 million and $1 million, respectively.

Speaker #1: Cost of sales in Q4 was $2.6 million, and for the full year was $10.1 million, with the full-year increase largely due to demand growth in the CFA.

Speaker #1: Q4 adjusted EBITDA was $5.7 million, up 3% compared to Q4 last year. For the full year, adjusted EBITDA increased 18% to $19.6 million. Excluding royalty revenue, the full-year increase would have been 24%.

Speaker #1: For Q4, the direct brand contribution of Clozaril to adjusted EBITDA was $7.7 million, while the direct brand contribution for CFA from the CFA to adjusted EBITDA was $0.3 million.

Speaker #1: For the full year, the contributions for Clozaril and the CFA were $26.9 million and $1 million, respectively. Of note, in 2024, the CFA's direct brand contribution to adjusted EBITDA was a loss of $3.6 million, highlighting the successful financial turnaround of this asset.

John Hanna: Of note, in 2024, Vascepa's direct brand contribution to adjusted EBITDA was a loss of $3.6 million, highlighting the successful financial turnaround of this asset. Cash from operations in Q4 was $6.5 million, up 103% compared to Q4 2024. For the full year, cash from operations was $17.1 million, up 114% versus 2024. Cash from operations has increased due to the factors I've described and has also benefited from lower interest expense, which was down $3.8 million or 43% compared to 2024. A big part of the story of our transformation over the past two years is the growth in adjusted EBITDA ex-royalties and improved cash flows.

Speaker #1: Cash from operations in Q4 was $6.5 million, up 103% compared to Q4, 2024. For the full year, cash from operations was $17.1 million, up 114% versus 2024.

Speaker #1: Cash from operations has increased due to the factors I've described and has also benefited from lower interest expense, which was down $3.8 million, or 43%, compared to 2024.

Speaker #1: A big part of the story of our transformation over the past two years is the growth in adjusted EBITDA ex royalties, and improved cash flows.

John Hanna: On a trailing twelve-month basis, you can see on this slide that after bottoming out in late 2023, early 2024 timeframe, we've seen consistent quarterly improvements in adjusted EBITDA ex-royalties. Our focus on operational improvements has restored our profitability trajectory and generated the strong cash flows that are enabling our balanced capital allocation approach today. One final comment on adjusted EBITDA. You can see on this slide that there tends to be seasonal quarterly variation. We expect a similar pattern in 2026, though the timing may be more pronounced given NILEMDO launch dynamics. We'll be investing in the first half of the year, with revenue beginning to ramp in Q2 and accelerating through the second half of 2026. Our balanced approach for capital allocation allows us to accomplish multiple objectives. First is to continue to delever the balance sheet by paying down debt.

Speaker #1: On a trailing 12-month basis, you can see on this slide that after bottoming out in late 2023, early 2024 timeframe, we've seen consistent quarterly improvements in adjusted EBITDA ex royalties.

Speaker #1: Our focus on operational improvements has restored our profitability trajectory and generated the strong cash flows that are enabling our balanced capital allocation approach today.

Speaker #1: One final comment on adjusted EBITDA: you can see on this slide that there tends to be seasonal quarterly variation. We expect a similar pattern in 2026, though the timing may be more pronounced given Nalendo launch dynamics.

John Hanna: We'll be investing in the first half of the year, with revenue beginning to ramp in Q2 and accelerating through the second half of 2026. Our balanced approach for capital allocation allows us to accomplish multiple objectives. First is to continue to delever the balance sheet by paying down debt. During 2025, we made principal repayments totaling $17.8 million. At December 31, 2025, the principal balance of our term loan stood at $50 million, down 26% from $67.4 million at the end of 2024. As a result of our continued delevering, net debt stood at $38.3 million at year-end, down 23% from the end of 2024, and down 50% from $75.6 million three years ago. Second is the return of capital shareholders via share buybacks.

Speaker #1: We'll be investing in the first half of the year with revenue beginning to ramp in Q2 and accelerating through the second half of 2026.

Speaker #1: Our balanced approach for capital allocation allows us to accomplish multiple objectives. First is to continue to deliver the balance sheet by paying down debt.

John Hanna: During 2025, we made principal repayments totaling $17.8 million. At December 31, 2025, the principal balance of our term loan stood at $50 million, down 26% from $67.4 million at the end of 2024. As a result of our continued delevering, net debt stood at $38.3 million at year-end, down 23% from the end of 2024, and down 50% from $75.6 million three years ago. Second is the return of capital shareholders via share buybacks. During 2025, we purchased approximately 519,000 shares at a cost of $1.8 million. Thirdly, deploying capital to expand our portfolio. With NILEMDO and NEXLIZET, we made an upfront payment of $1 million upon signing the agreement and will ultimately pay an additional $1 million upon Health Canada approval of NEXLIZET.

Speaker #1: During 2025, we made principal repayments totaling $17.8 million. At December 31, 2025, the principal balance of our term loan stood at $50 million, down 26% from $67.4 million at the end of 2024.

Speaker #1: As a result of our continued delivering, net debt stood at $38.3 million at year-end, down 23% from the end of 2024. And down 50% from $75.6 million three years ago.

Speaker #1: Second is the return of capital to shareholders via share buybacks. During 2025, we purchased approximately 519,000 shares at a cost of $1.8 million. And thirdly, deploying capital to expand our portfolio.

John Hanna: During 2025, we purchased approximately 519,000 shares at a cost of $1.8 million. Thirdly, deploying capital to expand our portfolio. With NILEMDO and NEXLIZET, we made an upfront payment of $1 million upon signing the agreement and will ultimately pay an additional $1 million upon Health Canada approval of NEXLIZET. The agreement also includes customary royalties on future sales and potential milestone payments tied to pricing, reimbursement, and the achievement of significant commercial sales targets. As Craig mentioned, we'll be investing here in 2026 to ensure the successful launch of NILEMDO, a key long-term growth driver for the business.

Speaker #1: With Nalendo and Next Lizette, we made an upfront payment of $1 million upon signing the agreement, and will ultimately pay an additional $1 million upon Health Canada approval of Next Lizette.

John Hanna: The agreement also includes customary royalties on future sales and potential milestone payments tied to pricing, reimbursement, and the achievement of significant commercial sales targets. As Craig mentioned, we'll be investing here in 2026 to ensure the successful launch of NILEMDO, a key long-term growth driver for the business. Looking at the balance sheet, cash was $11.7 million at year-end compared to $17.5 million at the end of 2024, with the change reflecting the debt payments and strategic investments made during the year, offset by growth in cash from operations. As we look ahead to 2026 and beyond, we'll continue this balanced approach to capital allocation, though with an increased emphasis on growth investments. Our strengthened balance sheet and improved cash flow profile give us the flexibility to pursue multiple objectives simultaneously.

Speaker #1: The agreement also includes customary royalties on future sales and potential milestone payments tied to pricing and reimbursement, and the achievement of significant commercial sales targets.

Speaker #1: And as Craig mentioned, we'll be investing here in 2026 to ensure the successful launch of Nalendo, a key long-term growth driver for the business.

John Hanna: Looking at the balance sheet, cash was $11.7 million at year-end compared to $17.5 million at the end of 2024, with the change reflecting the debt payments and strategic investments made during the year, offset by growth in cash from operations. As we look ahead to 2026 and beyond, we'll continue this balanced approach to capital allocation, though with an increased emphasis on growth investments. Our strengthened balance sheet and improved cash flow profile give us the flexibility to pursue multiple objectives simultaneously.

Speaker #1: Looking at the balance sheet, cash was $11.7 million at year-end compared to $17.5 million at the end of 2024. With the change reflecting the debt payments and strategic investments made during the year.

Speaker #1: Offset by growth in cash from operations. As we look ahead to 2026 and beyond, we'll continue this balanced approach to capital allocation, though with an increased emphasis on growth investments.

Speaker #1: Our strengthened balance sheet and improved cash flow profile give us the flexibility to pursue multiple objectives simultaneously. And with that, I'll pass it back to Craig for his closing comments.

John Hanna: With that, I'll pass it back to Craig for his closing comments.

Craig Millian: Thanks, John. In summary, our results for 2025 reflect progress against our key priorities. We're driving performance in our base business, maintaining strong margins, and generating cash. We're positioned for our next phase of growth as we actively prepare to expand the HLS Canadian cardiovascular franchise with the 2026 launch of NILEMDO and an expected 2027 launch of NEXLIZET. Our strengthened balance sheet will provide increased flexibility to pursue additional value-creating opportunities. As we enter 2026, we're leveraging our foundation of increased efficiency and profitability to advance towards our next stage of growth. We're well positioned to deliver value for our shareholders as we expand our cardiovascular franchise and build HLS into a larger, more diversified specialty pharmaceutical company. That concludes my prepared remarks. At this point, I'll ask our operator to please provide instructions for asking a question.

Speaker #2: Thanks, John. In summary, our results for 2025 reflect progress against our key priorities. We're driving performance in our base business, maintaining strong margins, and generating cash.

Speaker #2: We're positioned for our next phase of growth as we actively prepare to expand the HLS Canadian Cardiovascular franchise with the 2026 launch of Nalendo, and an expected 2027 launch of Next Lizette.

Speaker #2: And our strengthened balance sheet will provide increased flexibility to pursue additional value-creating opportunities. As we enter 2026, we're leveraging our foundation of increased efficiency and profitability to advance towards our next stage of growth.

Speaker #2: We're well positioned to deliver value for our shareholders as we expand our cardiovascular franchise and build HLS into a larger, more diversified specialty pharmaceutical company.

Speaker #2: That concludes my prepared remarks. At this point, I'll ask our operator to please provide instructions for asking a question.

Craig Millian: Thank you. Ladies and gentlemen, we will now begin the question-and-answer session. Should you have a question, please press star followed by the one on your touchtone phone. You will hear a prompt that your hand has been raised. Should you wish to decline from the polling process, please press star followed by the two. If you are using a speakerphone, please lift the handset before pressing any keys. One moment, please, for your first question. Your first question comes from Michael Freeman with Raymond James. Your line is now open.

Operator: Thank you. Ladies and gentlemen, we will now begin the question-and-answer session. Should you have a question, please press star followed by the one on your touchtone phone. You will hear a prompt that your hand has been raised. Should you wish to decline from the polling process, please press star followed by the two. If you are using a speakerphone, please lift the handset before pressing any keys. One moment, please, for your first question. Your first question comes from Michael Freeman with Raymond James. Your line is now open.

Speaker #3: Thank you. Ladies and gentlemen, we will now begin the question-and-answer session. Should you have a question, please press star, followed by one on your touch-tone phone.

Speaker #3: You will hear a prompt that your hand has been raised. Should you wish to decline from the polling process, please press star, followed by the two.

Speaker #3: If you are using a speakerphone, please lift the hands up before pressing any keys. One moment, please, for your first question. Your first question comes from Michael Freeman with Raymond James.

Michael Freeman: Hey, good morning, Craig, Brian, John. Congratulations on a strong year on the launch of NILEMDO and particularly the cost optimization initiatives you've undertaken this year. I wonder if you could go a little bit further into your launch strategy for NILEMDO's first year. You know, principally serving you know, the private payer market. Describe how, I guess what you will invest in it in activities you'll pursue this year.

Speaker #3: Your line is now open.

Speaker #4: Hey, good morning, Craig, Brian, John. Congratulations on a strong year on the launch of Nalendo, and in particular, the cost optimization initiatives you've undertaken this year.

Speaker #4: I wonder if you could go a little bit further into your launch strategy for Nalendo's first year. Principally, serving the private payer market, describe how, I guess, what you will invest in activities you'll pursue this year.

Craig Millian: Great. Thanks, Michael, and I think we'll ask Brian maybe to address that one.

Speaker #2: Great. Thanks, Michael. And I think we'll ask Brian maybe to address that one.

Brian Walsh: Sure. Thanks, Michael, for the question. As I shared, we're launching into a strong context, given that NILEMDO's been available in other markets for a number of years. There's already strong awareness and anticipation from Canadian physicians. We're excited to make the product available just last week and launch meeting in early April. Our efforts over the last nine months since being licensed have been heavily focused on the market access preparations. We've had very substantive engagements with private payers, and we expect to have more news on those in the coming months. Very receptive to the strong value proposition that NILEMDO presents, as I described, you know, relative to other costly options in the category.

Speaker #5: Sure. Thanks, Michael, for the question. So, as I shared, we're launching into a strong context. Given that Nalendo has been available in other markets for a number of years, there's already strong awareness and anticipation from Canadian physicians.

Speaker #5: So we're excited to make the product available. Just last week, and the launch meeting is in early April. Our efforts over the last nine months, since we've been licensed, have been heavily focused on the market access preparations.

Speaker #5: So, we've had very substantive engagements with private payers, and we expect to have more news on those in the coming months. They've been very receptive to the strong value proposition that Nalendo presents.

Speaker #5: As I described, relative to other costly options in the category, our efforts are—primarily, our biggest investment is in our Salesforce. Very tenured team, very passionate about cardiovascular risk reduction, and our efforts will be balanced in terms of driving awareness and adoption of Nalendo, but also leveraging that as a tailwind for Vascepa as we're engaging in an even broader conversation about cardiovascular risk reduction.

Brian Walsh: You know, our efforts, our primary or biggest investment is in our sales force and very tenured team, very passionate about cardiovascular risk reduction. You know, our efforts will be balanced in terms of driving awareness and adoption of NILEMDO, but also leveraging that as a tailwind for Vascepa as we, you know, we're engaging in an even broader conversation about cardiovascular risk reduction. We temper expectations in year one in Canadian launches because we are launching with just the private coverage, which we'll be rolling on throughout the year. A significant background effort is engaging with CADTH. We've submitted those reimbursement dossiers, and we expect mid-year to have an opinion from that organization, which will flow into provincial negotiations later this year.

Speaker #5: We temper our expectations in year one in Canadian launches because we are launching with just the private coverage, which will be rolling on throughout the year.

Speaker #5: So a significant background effort is engaging with CDA. We've submitted those reimbursement dossiers and we expect mid-year to have an opinion from that organization, which will flow into provincial negotiations later this year.

Brian Walsh: You know, hopefully initial provincial listings late this year or early next year, at which point we'd really start to see a ramp as products more broadly reimbursed. And that will, as I mentioned in my remarks, time nicely with the introduction of NEXLIZET based on our plan. That's kind of our plans in a nutshell. Anything to add, Craig?

Speaker #5: Hopefully, initial provincial listings late this year, early next year, at which point we'd really start to see a ramp as products more broadly reimbursed and that will, as I mentioned in my remarks, time nicely with the introduction of Next Lizette based on our plan.

Speaker #5: So that's kind of our plans in a nutshell. Anything to add, Craig?

Craig Millian: Yeah, no, I think that sums it up. I guess I just want to highlight a couple of points that Brian mentioned during his earlier comments that I think really excite us. One is, we did this awareness and usage study, baseline study ahead of launch just to get an understanding of, you know, what the levels of awareness and interest were in bempedoic acid. We surveyed a fairly sizable number of cardiologists and endocrinologists, and it was pretty remarkable in terms of the very high level of awareness, in particular, unaided awareness of this medicine and the interest in potentially prescribing it. Usually it takes quite a bit of time to generate those levels of awareness post-launch.

Speaker #2: Yeah, no, I think that sums it up. I guess I just want to highlight a couple of points that Brian mentioned during his earlier comments that I think really excite us.

Speaker #2: So one is, we did this awareness and usage baseline study ahead of launch, just to get an understanding of what the levels of awareness and interest were in bempedoic acid.

Speaker #2: So, we surveyed a fairly sizable number of cardiologists and endocrinologists, and it was pretty remarkable in terms of the very high level of awareness.

Speaker #2: In particular, unaided awareness of this medicine and the interest in potentially prescribing it. Usually, it takes quite a bit of time to generate those levels of awareness post-launch.

Craig Millian: Because this product has been available in the US and in Europe and has had, you know, really important data presented at major medical meetings, published in the New England Journal, the level of recognition is quite high. I would add, you know, the level of anticipation is quite high. We've had, you know, advisory boards and thought leaders who have emphasized how excited they are that this is gonna be made available to them in Canada. Of course, we have to do the work of getting, as Brian said, make sure we get the access and reimbursement. We've got our sales reps coming together and our medical people in the next few weeks for training and preparation.

Speaker #2: And because this product has been available in the US and in Europe and has had really important data presented at major medical meetings, published in the New England Journal, the level of recognition is quite high.

Speaker #2: And I would add the level of anticipation is quite high. We've had advisory boards and thought leaders who have emphasized how excited they are that this is going to be made available to them in Canada.

Speaker #2: So of course, we have to do the work of getting as Brian said and make sure we get the access and reimbursement. We've got our sales reps coming together and our medical people in the next few weeks for training and preparation.

Craig Millian: I think we're excited to hit the ground running, you know, based on this very high baseline level of awareness and interest.

Speaker #2: But I think we're going to we're excited to hit the ground running based on this very high baseline level of awareness and interest.

Michael Freeman: Perfect. I appreciate all of that detail. A follow-up question I have is on your 2026 outlook, thanks for providing some guidance. You know, the top line numbers fell slightly below consensus. I appreciate you providing some assumptions in the press release and in your prepared remarks today, but I wonder if you could provide a bit, just say more about how you're thinking about the growth in the base business and other factors that might impact top line specifically.

Speaker #4: Perfect. I appreciate all that detail. I'll have a follow-up question I have is on your 2026 outlook, thank you for providing some guidance. The top-line numbers were it fell slightly below consensus.

Speaker #4: And I wonder I appreciate you providing some assumptions. In the press release and in your prepared remarks today, but I wonder if you could provide a bit just say more about how you're thinking about the growth in the base business and other factors that might impact top-line specifically.

Craig Millian: Yeah, sure. I think, you know, we're very intentionally, I think, assuming conservative, you know, estimates for year one for NILEMDO, which we think, you know, we hope to outperform. I think we assume something on the order of $1 million plus in revenues for NILEMDO this year. We expect that to accelerate greatly towards the latter part of the year, especially as we get public access. Obviously, we double that portfolio next year with the launch of NEXLIZET. We would see significant growth for the bempedoic acid franchise as we move to 2027. Vascepa we expect to continue to grow. We're expecting growth in the teens this year. We're being conservative in our estimates for Clozaril.

Speaker #2: Yeah, sure. And I think we're very intentionally, I think, assuming conservative estimates for year one for Nalendo. Which we think we hope to outperform, but we assume something on the order of a million plus in revenues for Nalendo this year.

Speaker #2: And we expect that to accelerate greatly towards the latter part of the year and especially as we get public access. And then obviously, we double that portfolio next year with the launch of Next Lizette.

Speaker #2: So, we would see significant growth for the Bempedoic Acid franchise as we move to 2027. Vascepa we expect to continue to grow; we're expecting growth in the teens.

Speaker #2: This year. And we're being conservative in our estimates for Clozeryl. We're assuming flat to maybe a slight low single digit percentage decline in Clozeryl sales this year.

Craig Millian: We're assuming flat to maybe a slight low single-digit percentage decline in Clozaril sales this year based on, you know, what we had described that occurred really in the middle of last year around some of this increased competitive, you know, activity in Ontario, which, you know, did have some impact in our business there. We expect that will primarily impact the early part of this year on a kind of year-over-year comparison basis because again, the impact was primarily in the back half of last year. I think as we get through the first half of this year, we expect that business will stabilize and then largely be offset by gains in other provinces, where we continue to see strong growth, for example, in market share and patient volumes out west.

Speaker #2: Based on what we had described that occurred really in the middle of last year, around some of this increased competitive activity in Ontario, which did have some impact on our business there.

Speaker #2: We expect that will primarily impact the early part of this year on a kind of year-over-year comparison basis because again, the impact was primarily in the back half of last year.

Speaker #2: I think as we get through the first half of this year, we expect that business will stabilize and then largely be offset by gains in other provinces.

Speaker #2: Where we continue to see strong growth, for example, in market share in patient volumes out west were very encouraged by that as well as some of the Atlantic provinces.

Craig Millian: We're very encouraged by that as well as some of the Atlantic provinces. I think you put all that together, again, we wanted to be reasonably conservative in our guidance for this year, but that's how we come up with that range.

Speaker #2: So I think you put all that together, again, we wanted to be reasonably conservative in our guidance for this year. But that's how we come up with that range.

Michael Freeman: Okay. All right. Thank you very much. I'm going to pass it on.

Speaker #4: Okay. All right. Thank you very much. I'm going to pass it on.

Michael Freeman: Your next question comes from Matthew Milask with Stifel. Your line is now open.

Operator: Your next question comes from Matthew Milask with Stifel. Your line is now open.

Speaker #3: Your next question comes from Max. Melsky with Stifel. Your line is now open.

Matthew Milask: Good morning, guys. I'm on for Justin this morning. Thanks for taking my question. I guess firstly to you know, maybe get a little bit more granularity from a previous question, can you outline the cadence of incremental launch spend for NILEMDO through 2026 and what might the split be between promotional and, you know, other medical and patient support costs?

Max Czmielewski: Good morning, guys. I'm on for Justin this morning. Thanks for taking my question. I guess firstly to you know, maybe get a little bit more granularity from a previous question, can you outline the cadence of incremental launch spend for NILEMDO through 2026 and what might the split be between promotional and, you know, other medical and patient support costs?

Speaker #5: Good morning, guys. I'm on for Justin this morning. Thanks for taking my question. I guess, firstly, to maybe get a little bit more granularity from a previous question—can you outline the cadence of incremental launch spend for Nalendo through 2026, and what might the split be between promotional and other medical and patient support costs?

Craig Millian: Yeah. Max, thanks for the question. Brian or John, maybe you wanna take that one?

Speaker #2: Yeah. So Max, thanks for the question. Brian or John, John, maybe you want to take that one?

John Hanna: Yeah, sure. Max, the way I would sort of think about it in rough terms is, for the year, we'll get some nominal growth on the revenue line that in sort of large-scale terms will drop $2 million in additional gross profit. That will be deployed in about the same amount in OpEx increase split primarily between selling and marketing and medical and regulatory. Not quite 50-50 split. I would say, you know, 55% sales and marketing, 45% medical regulatory would be the makeup of that additional spend. Most of it front-end loaded in Q1. Q2 starts getting back to normal levels of OpEx by the Q4.

Speaker #4: Yeah, sure. Max, the way I would be sort of think about it in rough terms is for the year, we'll get some nominal growth on the revenue line that in sort of large-scale terms will drop a couple of million dollars in additional gross profit.

Speaker #4: That will be deployed in about the same amount in OPEX increase split primarily between selling and marketing and medical and regulatory. Not quite 50/50 split, I would say 55% sales and marketing, 45% medical regulatory.

Speaker #4: Would be the uptake of that additional spend. Most of it is front-end loaded in Q1 and Q2, and it starts getting back to normal levels of OPEX by the fourth quarter.

Craig Millian: Yeah. As John mentioned, we're a little front-loaded in terms of preparing, you know, for launch. A lot of the spend to date has been on access and reimbursement-related activities. Ensuring we had a really strong, you know, dossier to submit to the CDA. Of course, now we're preparing our sales force with training and promotional material, as well as a number of KOL engagement activities, key opinion leader engagement activities, advisory boards, both at a national, and regional level that are really being driven out of our medical team.

Speaker #2: Yeah. So we're a little as John mentioned, we're a little front-loaded in terms of preparing for launch. A lot of the spend to date has been on access and reimbursement-related activities.

Speaker #2: So ensuring we had a really strong dossier to submit to CDA. And of course, now we're preparing our Salesforce with training and promotional material as well as a number of KOL engagement activities, the opinion leader engagement activities, advisory boards, both at a national and regional level that are really being driven out of our medical team.

Craig Millian: I'd say in aggregate, you know, we're not increasing our footprint, but in aggregate, probably something on the order of about $2 million, incremental to support the NILEMDO launch and kind of split between those pieces.

Speaker #2: So I'd say in aggregate, we're not increasing our footprint, but in aggregate, probably something on the order of about 2 million dollars incremental to support the Nalendo launch and kind of split between those pieces.

Matthew Milask: Perfect. Thank you. Maybe a cash flow question back to John. Can you provide any additional detail on the CAD 7 million in milestone payments on NILEMDO and NEXLIZET and when these might be triggered? Is this based on maybe respective CDA outcomes? Like, what is the visibility on that?

Max Czmielewski: Perfect. Thank you. Maybe a cash flow question back to John. Can you provide any additional detail on the CAD 7 million in milestone payments on NILEMDO and NEXLIZET and when these might be triggered? Is this based on maybe respective CDA outcomes? Like, what is the visibility on that?

Speaker #5: Perfect. Thank you. And maybe a cash flow question. Back to John. Can you provide any additional detail on the 7 million in milestone payments on Nalendo and Next Lizette and when these might be triggered?

Speaker #5: Is this based on maybe respective CDA outcomes? What is the visibility on that?

John Hanna: Yeah. I'll let Brian talk about the specifics on pricing and reimbursement, but I would say the $1 million for the Health Canada approval. I would say timing is 2026, likely towards the end of the year based on where we're moving towards. Remaining milestones of the $7 million would start in probably Q2 2027 and onward. Maybe Brian can add color on the specifics of those.

Speaker #4: Yeah. I'll let Brian talk about the specifics on pricing and reimbursement, but I would say the 1 million for the health Canada approval, I would say timing is 2026, likely towards the end of the year based on where we're moving towards.

Speaker #4: And then remaining milestones of the 7 million would start in probably Q2, 2027 and onward. And maybe Brian can add color on the specifics of those.

Brian Walsh: Yeah. At a high level, they're tied to pricing outcomes of both at a list price and a negotiated pCPA price. We won't go into too much specifics, but we're at the levels that would support a very strong case for NILEMDO moving forward.

Speaker #2: Yeah. At a high level, they're tied of both at a list price and a negotiated TCPA price. So we'll go into too much specifics, but that level is that would support very strong case for Nalendo moving forward.

Craig Millian: Yeah, the better the pricing we get, there's a sliding scale in terms of the payment that would trigger. That would be a good problem, you know, for us to have a higher payment. That would suggest that we negotiated very favorable pricing. Just another way that we structured the deal, you know, as our BD approach is to, you know, find assets that are largely de-risked from a clinical regulatory perspective and then, you know, also try to stage gate it in a way that we can de-risk some of the key commercial risk factors like access and reimbursement. That's how we structured it.

Speaker #2: So yeah. The better the pricing we get, there's a sliding scale in terms of the payment that that would trigger. So that would be a good.

Speaker #2: That would be a good problem for us to have to have a higher payment that would suggest that we negotiated very favorable pricing. And so just another way that we structure the deal is our BD approach is to find assets that are largely de-risked from a clinical regulatory perspective and then also try to stage gate it in a way that we can de-risk some of the key commercial risk factors like access and reimbursement.

Matthew Milask: Great. Maybe one more question. It's a bit of a tangential, but you mentioned inclination to pursue maybe strategic acquisitions beyond just maybe in licensing. Based on the pipeline as you see it, is there a point where it makes sense to use stock as currency in getting a deal done, you know, without straining the balance sheet too heavily?

Max Czmielewski: Great. Maybe one more question. It's a bit of a tangential, but you mentioned inclination to pursue maybe strategic acquisitions beyond just maybe in licensing. Based on the pipeline as you see it, is there a point where it makes sense to use stock as currency in getting a deal done, you know, without straining the balance sheet too heavily?

Speaker #2: So, that was how we structured it.

Speaker #5: Great. And maybe one more question a bit of a tangential, but you mentioned inclination to pursue maybe strategic acquisitions. Beyond just maybe in licensing, and based on the pipeline as you see it, is there a point where it makes sense to use stock as currency in getting a deal done?

Speaker #5: Without straining the balance sheet too heavily?

Craig Millian: Yeah, that would not, and I'll also maybe let John comment on this. I don't think certainly at these prices, that would not be our preference. I think we feel the stock is quite undervalued. I think we would look for other mechanisms. Again, I think, you know, we wanna be opportunistic. I think depending on obviously the quality of the opportunity and the value creation opportunity that it would present, you know, we would figure out the best way to deploy the capital. I don't think that certainly wouldn't be our first instinct. John, you have anything to add?

Speaker #2: Yeah. That would not and I'll also maybe let John comment on this. I don't think certainly these prices that would not be our preference that we bill with stock is quite undervalued.

Speaker #2: And so I think we would look for other mechanisms. And again, I think we want to be opportunistic. So I think, depending on, obviously, the quality of the opportunity and the value creation opportunity that it would present, we would figure out the best way to deploy the capital.

Speaker #2: But I don't think that would be our first that certainly wouldn't be our first instinct. John, do you have anything to add?

John Hanna: No, I would agree. You know, there could be something small beyond an in-licensing, but I don't think we'd be at this point considering that as funded through equity. You know, a little further down the road, certainly, we'd be entertaining those, but would like to see the share price higher before we start using it as currency.

Speaker #4: No, I would agree. There could be some things small beyond an in-licensing but I don't think it would be at this point considering that as a funded through equity.

Speaker #4: A little further down the road, certainly we'd be entertaining those. But I would like to see the share price higher before we start using it as a currency.

Matthew Milask: That's great. Thanks so much, guys.

Max Czmielewski: That's great. Thanks so much, guys.

John Hanna: Thanks, Max.

John Hanna: Ladies and gentlemen, as a reminder, should you have a question, please press star one. Your next question comes from David Martin with Bloomberg. Your line is now open.

Operator: Ladies and gentlemen, as a reminder, should you have a question, please press star one. Your next question comes from David Martin with Bloomberg. Your line is now open.

Speaker #5: That's great. Thanks so much, guys.

Speaker #4: Thanks, Max.

Speaker #1: Ladies and gentlemen, as a reminder, should you have a question, please press star one. Your next question comes from David Martin with Bloomberg. Your line is now open.

David Martin: Good morning. I think you're anticipating that NILEMDO reimbursement will be substantially less restrictive than the PCSK9s. What gives you confidence in that regard? Has there been anything concrete so far with the private payers giving you listings that support that expectation?

Speaker #6: Good morning. I think you're anticipating that Nalendo reimbursement will be substantially less restrictive than the PCSK9s. What gives you confidence in that regard? And has there been anything concrete so far with the private payers giving you listings that support that expectation?

Brian Walsh: Hey, David. Good morning. This is Brian. Thanks for the question. We're active in those discussions now, which gives us confidence. Nothing to announce just yet. I think we're seeing that the value proposition is well received. And there's also an acknowledgment from, you know, at these price levels that, you know, putting a lot of restrictions in place would be very onerous for the patient, for the physician, and for the insurance company themselves. So more to come. You know, the other thing is, in these discussions, companies are looking to use technology more and more, and we're trying to lead on that discussion.

Speaker #2: Hi, David. Good morning. This is Brian. Thanks for the question. We're active in those discussions now, which gives us confidence. Nothing to announce just yet, but the I think we'll we're seeing that the value proposition is well received.

Speaker #2: And there's also an acknowledgment from at these price levels that putting a lot of restrictions in place would be very onerous for the patient, for the physician, for the insurance company themselves.

Speaker #2: So more to come, but I think we'll the other thing is in these discussions, companies are looking to use technology more and more, and we're trying to lead on that discussion.

Brian Walsh: Ways to ensure through auto adjudication that patients have been on statin at some point in the past versus having to do, you know, more onerous paperwork and physician signatures. I think we'll be on the cutting edge of those discussions, so hopefully in terms of more efficient ways for reimbursement adjudication. But I think importantly to the price delta, you know, to the cost delta per patient per year that we've talked about in the past, relative to the ability to get very high levels of LDL reduction with NILEMDO plus ezetimibe plus statin, we're not seeing quite the opposite, in fact. We're not seeing a desire for payers to put restrictions in place, private payers to put restrictions in place.

Speaker #2: So ways to ensure through auto adjudication that patients have been on statin at some point in the past versus having to do more onerous paperwork and physician signatures.

Speaker #2: So I think we'll be on the cutting edge of those discussions, hopefully in terms of more efficient ways for reimbursement adjudication. But I think importantly, to the price to the cost delta per patient per year that we've talked about in the past relative to the ability to get very high levels of LDL reduction with Nalendo plus ezetimibe plus statin, we're not seeing quite the opposite.

Speaker #2: In fact, we're not seeing a desire for payers to put restrictions—private payers—to put restrictions in place. Yeah. This is a really—yeah.

Craig Millian: Yeah, this is a really.

David Martin: Dave?

David Martin: Great.

Craig Millian: Yeah. Yeah, I was just gonna add, you know, it's important to distinguish between, you know, the experience with Vascepa. This is a very different type of market where it's very well, you know, understood in terms of the importance of getting patients to their LDL targets. You know, this fits squarely within the paradigm of the patient population we've defined and the value of, you know, that line of therapy before either, you know, the patient's failing treatment altogether, not getting to their targets, which is really unacceptable, or really being forced to go on a more costly injectable. Really everybody understands, you know, that those are kind of the choices. I think they're far more receptive to, you know...

Speaker #2: Yeah. I was just going to add to distinguish between the experience with placebo. This is a very different type of market where it's very well understood in terms of the importance of getting patients to their LDL targets.

Speaker #2: And so this fits squarely within the paradigm of the patient populations we've defined and the value of that line of therapy. Before either the patient's failing treatment altogether and not getting to their targets, which is really unacceptable, or really being forced to go on a more costly injectable.

Speaker #2: And so really everybody understands that those are kind of the choices and so I think they're far more receptive to and welcoming, quite frankly, in terms of where Nalendo can fit into that paradigm.

Craig Millian: Welcoming, quite frankly, in terms of where NILEMDO can fit into that paradigm.

David Martin: Okay, thanks. Other countries have lowered cholesterol targets. Do you know if the same's expected in Canada? I assume that would be good for the NILEMDO launch.

Speaker #6: Okay. Thanks. Other countries of lowered cholesterol targets, do you know if the same is expected in Canada? And I assume that would be good for the Nalendo launch.

Brian Walsh: Yes. Specifically European countries have lowered to 1.4. Canada is still 1.8. We just, as I mentioned in my remarks, had a national advisory board, and that was a topic of discussion. I think Canadian opinion leaders are thinking in that path of wanting to get to lower levels. We don't expect the guidelines to be updated in the next 12 to 24 months, which could reflect that. But certainly a tailwind for, you know, tailwind. We haven't baked that into our, you know. As we reflect kind of patient opportunity, we look at patients that are not at current goals. That is a, you know, an opportunity moving forward that more patient, you know, potentially more patients would become eligible.

Speaker #2: Yes. Specifically, European countries have lowered to 1.4. Canada is still at 1.8. We just I mentioned my remarks had a national advisory board and that was a topic of discussion.

Speaker #2: I think Canadian opinion leaders are thinking in that path of wanting to get to lower levels. We don't expect the guidelines to be updated in the next 12 to 24 months, which could reflect that.

Speaker #2: But certainly a tailwind for tailwind. We haven't baked that into our as we reflect kind of patient opportunity. We look at patients that are not at current goals.

Speaker #2: So that is an opportunity moving forward that more potentially more patients would become eligible.

David Martin: Speaking of the opportunity, you mentioned CAD 50 to 100 million on peak sales. Is that range dependent on whether NEXLIZET gets approval?

Speaker #6: And speaking of the opportunity you mentioned 50 to 100 million in peak sales. Is that range dependent on whether Nexlizec gets approval?

Craig Millian: You know, again, this is based on, I would say, fairly conservative share assumptions. I think our expectation, frankly, is that NEXLIZET will get approval. You know, without going into great detail, the types of questions that were raised by Health Canada were not of great significance in terms of, you know, requiring, you know, significant new data generation, for example. There's no question around the clinical profile, the safety and efficacy data. They were really more technical matters. You know, we're assigning very high probability that we'll be able to work through this in the next few months. We don't really see the prospect of NEXLIZET not getting approval as a realistic outcome.

Speaker #2: So again, this is based on, I would say, fairly conservative share assumptions. I think our expectation, frankly, is that Nexlizet will get approval. Without going into great detail, the types of questions that were raised by Health Canada were not of great significance in terms of requiring significant new data generation, for example.

Speaker #2: There's no question around the clinical profile, the safety and efficacy data that were really more technical matters. And so we're assigning very high probability that we'll be able to work through this in the next few months.

Speaker #2: So, we don't really see the prospect of Nexlizec not getting approval as a realistic outcome. It's been approved in every other market with the same data package.

Craig Millian: It's been approved in every other market with the same data package. Again, based on the questions raised, none of them are really of great concern in terms of our ability to address them. It's really a matter of when, not if. As Brian said, you know, we actually think that the staging works in our favor because it is a novel mechanism, and physicians are gonna want to get some experience with the novel mechanism before removing, you know, other treatments in a combo pill. We actually think from a life cycle management perspective, this is quite ideal to launch with NILEMDO, familiarize everybody with bempedoic acid and all the data and the mechanism of action. Then, you know, be able to follow that up.

Speaker #2: And again, based on the questions raised, none of them are really of great concern in terms of our ability to address them. It's really a matter of when, not if.

Speaker #2: And as Brian said, we actually think that the staging works in our favor because it is a novel mechanism and physicians are going to want to get some experience with the novel mechanism before removing other treatments in a combo pill.

Speaker #2: So we actually think from a life cycle management perspective, this is quite ideal to launch with Nalendo, familiarize everybody with bempedoc acid and all the data and the mechanism of action.

Craig Millian: You know, again, our best estimate is early 2027, you know, then with a combo pill, which will create obviously much greater convenience for patients. I think it's a, it's a good question, Dave, but I don't think it's one that really is germane, because we've, you know, again, our assumption is that this will launch in 2027.

Speaker #2: And then be able to follow that up. Again, our best estimate is early 2027. Then with the combo pill, which will create obviously much greater convenience for patients.

Speaker #2: So, I think it's a good question, Dave, but I don't think it's one that really is germane, because again, our assumption is that this will launch in 2027.

David Martin: Okay, thanks. I have one more quick question. You mentioned factors that curtailed the NCIB. I'm just wondering what those were.

Speaker #6: Okay. Thanks. And I have one more quick question. You mentioned factors that curtailed the NCIB. I'm just wondering what those were.

Brian Walsh: John, if you wanna speak to that.

Craig Millian: John, if you wanna speak to that.

John Hanna: Yeah, just, you know, at times we're in blackout periods and prevented from purchasing shares. There will be times during the year where we're more or less active just depending on market conditions and our priorities in capital allocation.

Speaker #2: John, if you want to speak to that.

Speaker #4: Yeah, just times we're in blackout periods in preventing from purchasing shares. And then there will be times during the year where we're more or less active, just depending on market conditions and our priorities and capital allocation.

David Martin: Okay, thanks. That's it for me.

John Hanna: Thanks, Dave.

John Hanna: There are no further questions at this time. I will now turn the call over to Craig Millian for closing remarks.

Operator: There are no further questions at this time. I will now turn the call over to Craig Millian for closing remarks.

Speaker #6: Okay. Thanks. That's it for me.

Speaker #4: Thanks, Dave.

Craig Millian: All right. Thank you, Joelle, and thank you all for participating on today's call. We look forward to reporting to you on our progress in the coming quarters and speaking with you all again soon. Thanks. Goodbye.

Speaker #1: There are no further questions at this time. I will now turn the call over to Craig Millian for closing remarks.

Speaker #2: All right. Thank you, Joel. And thank you all for participating on today's call. We look forward to reporting to you on our progress in the coming quarters and speaking with you all again soon.

Craig Millian: Ladies and gentlemen, this concludes your conference call for today. We thank you for participating and ask that you please disconnect your lines.

Operator: Ladies and gentlemen, this concludes your conference call for today. We thank you for participating and ask that you please disconnect your lines.

Speaker #2: Thanks. Goodbye.

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