Full Year 2025 Enlivex Therapeutics Ltd Earnings Call

<unk> conference call at this time, all participants are in a listen only mode. After the speaker presentation. There will be a question and answer session to ask a question. During the session you will need to press the Q&A button at the bottom of the screen and type. Your question in with US today are in life <unk> Executive Chairman <unk>, Chief Executive officer, or an hershkowitz I'd like to start by reminding.

You that certain comments on this call are forward looking statements as defined by the private Securities Litigation Reform Act of 1995. Please review the forward looking and cautionary statements section at the company's fourth quarter and full year 2025 earnings press release for various factors that could cause actual results to differ materially from forward looking statements made during the call today any forward looking.

Once made during this call speak only as of today's date and reflect the Companys current views with respect to future events and <unk> is under no obligation to update or revise forward looking statements made on this call whether as a result of new information future events or otherwise except as required by law I'd also like to remind everyone that today's call is being recorded and an archived version of the call will be available on the company's.

Website as promptly as possible after the call with that I'd like to turn the call over to <unk> Chairman Shine of it Shai.

Thank you Paul and welcome everyone I appreciate you joining us today.

2025 was a defining and transformational year for NN life VIX. This was the year in which you made several bold moves and firmly established and live vaccine. What we believe is a new category in the public markets. The quality longevity company powered by a prediction markets.

Treasury.

Or more simply put the company operating at the intersection of health spend and what we call will span and we will get to it a little later our strategy is built on a clear and differentiated foundation.

At its core we believe that <unk> brings together two powerful capabilities.

On the one hand, we are advancing our clinical stage platform focused on Coleman underserved longevity related assets, where we believe we can deliver meaningful therapeutic impact on the quality of extended longevity.

At the same time, we have built a treasury architecture designed to capture value from the emerging prediction markets economy.

What is important is not just the presence of these two capabilities.

But how they work together.

This combination allows us to operate our clinical development through a capital strategy aligned with one of the fastest growing areas.

Our financial infrastructure.

This is what we referred to as our dual engine model or more broadly the convergence of biology, and finance and infrastructure into a single institutional framework.

This strategy transformation is directly reflected in our 2025 financial results for the full year, we generated $1 23 billion in net income.

And 25 point $48 in earnings per share.

These results were driven by the appreciation of our treasury and treasury related assets.

And more importantly, we believe they represent the early validation of our treasury strategy in a rapidly institutionalizing markets.

We do not view this as a one time event. We believe this is the initial expression of the repeatable and scalable capital strategy aligns with the growth of prediction markets as the new financial category.

Stepping back what is important here is not just the performance in a single year.

It is the structure of opportunity we are positioning the company around.

Prediction markets are evolving from an experimental concept into what we believe will become the core layer of global financial infrastructure.

We have been seeing this reflected in growing trading volumes and expanding real world utility in forecasting and risk pricing and importantly, this shift is now being validated by a meaningful institutional capital entering the space.

In lilac today provides one of the only institutional grade GAAP compliant vehicles.

In equity markets through which investors can access the prediction markets opportunity.

Within the traditional public equity framework.

Let me now turn to what we believe is one of the most compelling aspects of our model.

As part of our strategic partnership with the Rain Foundation.

Which independently overseas the decentralized prediction markets rain protocol, we secured an exclusive one year option to acquire up to 275 billion of rain tokens at a fixed price off points here 033 per token, which is substantially below current prices.

As a token today. This is not simply an acquisition mechanism. This is best understood as an embedded high convexity growth engine was in our capital structure.

In more familiar terms it functions as a warrant like component embedded in our equity <unk>.

Providing potentially meaningful upside participation without immediate dilution.

Yesterday, we announced a series of updates which are tied to this auction and other value creation efforts, we entered into a $21 million debt financing agreement with a New York based institutional fund manager and we plan to use the net proceeds from this financing to fund both our <unk>.

<unk> development efforts as well as to acquire additional $3 billion of rain tokens.

At at a substantial discount to its closing price.

Two days ago for a total aggregate purchase price of $10 million.

In addition, we announced that together with the Ring Foundation, we extended our <unk>.

Brain token purchase option, which was originally scheduled to expire in November 30th 2026, It's now December 31 2027, keeping.

Keeping the same exercise price strategically this gives us the ability to potentially raise capital opportunistically and deploy that capital that's structurally advantaged pricing.

Allowing us to expand our treasury in a way intended to enhance long term shareholder value.

And at the same time, hopefully the rain centralized prediction markets protocol continue to build itself into a leading player.

Lastly, we announced that our board of directors approved the adoption of a share repurchase program to acquire up to.

$20 million of our outstanding ordinary shares subject to satisfaction of meeting applicable regulatory requirements.

The notes were issued as a convertible.

And its convertible after a 90 day holding period.

Which means that they cannot convert it in the first 90 days and it's converted into ordinary shares at a fixed conversion price of approximately $2 $69, which represents 264% premium to the NASDAQ closing price.

I'll first talk on Friday.

We believe that this unusually high conversion premium and the associated limitations on any conversion in the next three months represent the conviction of the institutional investor of the attractiveness of our strategy.

At the same time, our clinical engine remains central to our identity and long term value.

Cetera has continued to demonstrate clinically meaningful and statistically significant results alongside a favorable safety profile and we see a clear pathway toward late stage development in osteoarthritis and other inflammatory indications the.

The clinical part for me is not separate from our Treasury strategy is complementary.

It provides what we describe as a biological floor to our overall value proposition, helping balance volatility while advancing meaningful therapeutic innovation.

We reported two days ago that the FDA has cleared our investigational drug application for a late stage phase two b clinical trial in knee osteoarthritis, a debilitating disease that negatively affects the quality of.

Life of tens of millions in the United States. This is big news for Us and we are moving forward.

<unk>.

Ultimately, we believe in live X is not easily categorized within traditional sectors were not simply a quality longevity company, we're not simply a digital asset Treasury company.

We are building what we believe is a new institutional archetype.

A company designed to capture value across both scientific innovation and emerging financial infrastructure.

Or is it we describe it internally we are the architects of the future building the foundation for a new class of public companies.

With that I will turn the call over to Orin.

We will talk through our 2025 financial results in more detail and provide deeper insights into the execution of our treasury strategy and clinical progress.

Or M <unk>.

Thank you Shai.

Let me start with the headline numbers for the full year 2025, we reported net income of $1 23 billion and diluted earnings per share of 25 point $48, which in accordance with GAAP is calculated based on the weighted average shares outstanding.

<unk> for the year.

We ended the year with $2 31 billion in total treasury and treasury related assets and <unk>.

$193 billion in shareholders equity.

So it shall I mentioned these results were driven by the appreciation in the valuation of our treasury and treasury related assets more specifically these results reflect the market base reevaluation of our strategic holdings aligned with the growth and increasing adoption a prediction mark.

<unk> is an emerging asset class.

Importantly.

What we're seeing is not isolated to online. We believe it is a function of abroad or structural momentum in the prediction markets ecosystem, which we have positioned ourselves to capture early.

I mean, I'll take you a step back and explain how this works.

Because ultimately the key question is now what happened in 2025. It is why we believe this model can continue to generate value over time.

When we evaluated our treasury strategy.

Not looking for a digital asset portfolio that had already been used and copied by others.

We were looking for a catheter or we would real utility real adoption and long term structural growth, we believe that prediction markets meets all three criteria.

And their core prediction markets function as a mechanism for aggregating collective intelligence, while also serving as a real time system for pricing probability and future outcomes.

Suddenly they are evolving into a fundamental financial primitive for decision making across markets.

We're already seeing this reflected in strong dragging volumes rapid user growth and increasing institutional engagement and we believe the category is still in the early stages.

Within this category, we selected rain as a primary digital Treasury reserve asset and the simplest way to think about rain is that it is like a tick tock of prediction markets. It is fully decentralized permissionless global and designed to scale I don't know.

Centralized platforms, where market creation and liquidity are inherently constrained rain allows any user anywhere in any language to create and trade markets.

That fundamentally changes the structure of the system enables our long tail supply of markets support continuous liquidity through a M. M based mechanism and drives a network effect that we believe is critical for long term adoption and scale.

What makes this even more powerful is the token model that.

The protocol applies a 5% fee on total trading volume would half of that used to buy back Dawkins from the open market and permanently burned them. As a result, there is a direct linkage between protocol usage and long term token supply dynamics, so as activity increases.

Is supply contracts potentially concentrating value for long term shareholders such as analytics.

We refer to this as usage driven value creation.

And is the plan long term holder and active participants we believe <unk> is positioned to benefit directly from that dynamic.

From a balance sheet perspective, we believe we are well positioned with 193 billion in equity of rapidly scaling treasury based and significant capital flexibility.

Our focus remains on disciplined deployment, ensuring that capital allocation continues to support both treasury expansion and the advancement of our clinical programs.

Let me now briefly touch on our clinical engine, which remains a critical component of our overall value proposition.

<unk> cetera has demonstrated clinically meaningful and statistically significant results a favorable safety profile and durable improvements in pain and function in osteoarthritis patients.

Looking ahead, we have a clear set of upcoming clinical milestones over the next 12 to 18 months.

Assignments, and we announced two days ago that the FDA has cleared our investigational drug application for a late stage phase two b clinical trial in knee osteoarthritis.

This is our first regret or approval for a multi center multi country randomized double blind placebo control phase two b trial in age related moderate to severe knee osteoarthritis.

From there, we expect to generate three and six months topline data in 2027 setting the stage for a pivotal phase III trial.

<unk> is dedicated and experienced team is eager to push this clinical program forward as fast as possible and with the highest quality.

It is important to emphasize that osteoarthritis is one of the most prevalent and disabling diseases worthwhile affecting more than 32 million Americans today and projected to impact 78 millions of Americans by 'twenty 40, just in the U S by 860 knee osteoarthritis.

Affects roughly 30% of the population and about half of New York. They are routed spacing are 60 years and older.

This demographic is expanding with global aging trends underscoring the need for new durable therapies. Consequently, the 7 billion estimated market is expected to continue globally to expand substantially.

And importantly.

We believe our treasury strategy will enable us to advance these programs without relying solely on traditional capital markets financing. This is a key element of the hybrid model.

Let me close with a few broader thoughts first we believe we are still early in both engines prediction markets are in the early stages of institutional adoption and our clinical program is advancing toward the late stage value inflection points.

Second they are currently very few if any public market vehicles that provides this type of exposure and a compliant GAAP based structure.

That creates a degree of gravity.

And positioning and live acts as a potential getaway acid for investors seeking participation and this convergence.

Finally, our focus remains consistent continuous scaling our treasury strategy continue advancing our clinical programs and continue expanding institutional engagement around this model.

We believe this combination and the integration of financial infrastructure and biological innovation represents not just our strategy, but a new category of company and.

And we're committed to leading that category.

I want to thank the team for their continued dedication and execution and for their focus and commitment. They bring to building. This company every day and I Wanna thing, our shareholders and partners for their ongoing support and confidence as we continue to advance this dual engine model.

Thank you.

With that we'll now open the call for questions to ask a question. Please press the Q&A button at the bottom of your screen and type of question.

We've already had a few questions come in our first one crypto in general was down hard in 2025, and most of the other digital treasury companies out there posted or will post substantial losses for 2025, how come and lie backs is posting such large profits for 2025.

Yes, [laughter] and excellent question crypto.

Crypto has had a tough period recently.

But the exposure of <unk> three treasury.

Is to prediction markets, specifically, a decentralized prediction markets token rain as you know.

I think that the market has been very bullish in prediction markets recently.

And that translated into the rain token valuation to increase creating that value for in light of X and creating those look.

Very large profits in contrast to what's been happening in crypto.

Thank you Shari and our next question your market cap is at a discount to your treasury valuations something that we have started seeing across many digital treasury companies, how do you explain that.

Definitely a crypto, we think has been out of favor.

And as a result, most digital treasury companies have been out of favor as well leading to what we call net asset value discounts.

We hope that the prediction market ecosystem will continue growing.

Rain with it and we believe that the discounts for the net asset value of <unk> will be diminished going forward.

Thank you and our next question has come in.

Biotech companies are usually defined by dilution and long time lines does this change how clinical stage company. It can be financed going forward.

This is a very interesting question I think that the funding possibilities for earlier stage biotech companies.

Have been minimized once the coffee the area was kind of done.

While the latest stage projects, which are close to FDA approval still have funding available. Therefore, you know for earlier stage biotechs.

Definitely used to be the question of what would be the dilution as a result of additional financings yet in the last 24 months or so.

It's changed to a question of whether there is funding available at all.

Regardless of potential dilution.

The model we implemented in <unk> has been designed to first of all avoid the debt problem that was just mentioned.

No funding available because earlier stage biotech.

Capital availability scars no problem, we would self fund from a small percent of the appreciation in the treasury assets.

Does it so for the basic dilution problem hopefully is now the investors in <unk> are owners of a dual strategy and would potentially share the value that may come from either the clinical development side and or the treasury side.

Thank you and our next question.

This is one of the first times prediction markets infrastructures reflected in public company earnings or do you see this as a one off outcome or is at the beginning of a broader shift.

Well definitely we see this as a beginning of a broader shift I mean, while we are currently to the best of our knowledge right are the only public traded company that provides investor with the ability to invest through an equity in prediction markets.

We assume that this is just just the beginning you know and that we will see additional such opportunities in the next few years.

Thank you and our next question from a public markets perspective, how should investors think about in live X now after these results.

Or maybe let me take that one yeah.

Yeah sure. Thanks side, well I think investors were waiting on the sidelines to get some initial clarity on the potential value creation of <unk> with its prediction market Treasury strategy and clearly post. This earnings report I believe that many investors are looking at the live acts differently now.

And and paying more attention to both sides of the dual model strategy.

Thank you.

And we have one more question here looking ahead, what are the key drivers that will determine whether this model continues to scale.

You know, we we believe that this would be determined by the value drivers of the dual engine model.

Our working assumption is that the prediction markets ecosystem with continued to thrive in the next decade.

And that alongside the growth in centralized prediction markets theres going to be a substantial growth in decentralized prediction markets as well.

We believe that drain would become one of the leading decentralized prediction markets ended the reign token would become highly valuable upon that occurs on the other side, we believe that our quality longevity clinical program will provide value as well and that is potentially substantial.

These two pillars woods defined the scalability of the model and there are many milestones that both are executing.

And trying to reach and planning to reach during the next two years or so.

Thank you and that concludes our Q&A session, where there any final comments that you'd like to leave the audience.

Yes. Thank you we Wanna say, thanks for to everybody that that joined in we appreciate the questions that were asked.

And we hope we provided clarity.

Today with respect to our strategy are planning the scalability of our model and the magnitude of the.

Earnings per share for 2025, we look forward to I'm going to get to everybody in the next quarterly call. Thank you so much.

Thank you and that concludes today's call.

Goodbye everyone.

You for standing.