Adma Biologics, Inc. Q1 FY2023 Earnings Call

Good afternoon. And welcome to the ADMA Biologics First Quarter 2023 Financial Results and Corporate Update Conference Call on Wednesday, May 10, 2023. At this time, all participants are in a listen-only mode. There will be a question-and-answer session to follow. Please be advised that this call is being recorded at the Company’s request and will be available on the Company’s website approximately two hours following the end of the call. At this time, I would like to introduce Skyler Bloom, Senior Director, Business Development and Corporate Strategy at ADMA Biologics. Please go ahead.

Welcome, everyone. And thank you for joining us this afternoon to discuss ADMA Biologics' financial results for the first quarter 2023 and recent corporate updates. I'm joined today by Adam Grossman, President and Chief Executive Officer; and Brian Lenz, Executive Vice President, Chief Financial Officer and General Manager of ADMA BioCenters. During today's call, Adam will provide some introductory comments and an update on corporate progress, and then Brian will provide an overview of the company's first quarter 2023 financial results. Finally, Adam will then provide some brief summary remarks before opening up the call for questions. Earlier today, we issued a press release detailing the first quarter 2023 financial results and summarized certain achievements and recent corporate updates. This release is available on our website at www.admabiologics.com. Before we begin our formal comments, I'll remind you that we will be making forward-looking assertions during today's call that represent the company's intentions, expectations or beliefs concerning future events, which constitute forward-looking statements for the purposes of the safe harbor provisions under the Private Securities Litigation Reform Act of 1995. All forward-looking statements are subject to factors, risks and uncertainties, such as those detailed in today's press release announcing this call and in our filings with the SEC, which may cause actual results to differ materially from the results expressed or implied by such statements. In addition, any forward-looking statements represent our views only as of the date of this call and should not be relied upon as representing our views as of any subsequent date. We specifically disclaim any obligation to update any such statements, except as required by the federal securities laws. We refer you to the disclosures notice section in our earnings release we issued today, in the Risk Factor sections of our 2022 annual report on Form 10-K for the year ended December 31, 2022, and our quarterly report on Form 10-Q for the quarter ended March 31, 2023, for a discussion of important factors that could cause actual results to differ materially from these forward-looking statements. Please note that today's discussion includes certain non-GAAP financial measures, including adjusted EBITDA. A reconciliation of non-GAAP financial measures to the nearest comparable GAAP metric is available in our earnings release. With that said, I would now like to turn the call over to Adam Grossman. Adam, go ahead.

Thank you, Skyler. During the first quarter of 2023, ADMA generated first-time adjusted EBITDA profitability, totaling $2.5 million. This milestone achievement was enabled by an impressive 96% year-over-year increase in total revenues, which reached $57 million in the first quarter. The robust revenue growth translated to meaningful operating leverage, which was a result of continued gross profit growth and disciplined management of our operating expenditures. Based on these trends, we have increased our 2023 total revenue guidance now expected to exceed $220 million, and we anticipate continuing to grow adjusted EBITDA from the newly established baseline throughout the remainder of 2023. Although it's still early for our forecasted revenue growth and profitability cycle, we believe ADMA is now entering a new echelon alongside some of our high-quality industry peers. Based on the year-to-date financial results and considering our newly increased financial guidance, ADMA is among only a few standalone biopharma companies in the United States that are expected to generate total revenues of more than $220 million for the full year of 2023, while maintaining a substantial revenue growth rate and also generating continued adjusted EBITDA profitability. We are proud to now be included in this exclusive set of high-quality biopharma companies. Within the $10 billion plasma space specifically, ADMA advanced its position as the fastest-growing provider of immune globulin in the United States market, which we attribute to our organization's exclusive focus on the immune-deficient patient segment, the immune globulin market's fastest-growing cohort. During the first quarter, we treated a record number of patients and gained strong market share among what we anticipate will prove to be sticky books of business. We believe our innovative business model, unique immune globulin portfolio, and targeted medical education efforts position us well for future success. We believe the milestones we've achieved to date validate our core mission, to commercialize novel products for immune-compromised patients at risk of infection. It is treating this underserved patient population that fuels our organization and drives our company's unified commitment to overachieve and deliver on our operational and financial objectives. Over the past two years, we've communicated an unwavering message about our favorably evolving product mix, and we're happy to confirm that these trends are continuing to strengthen in 2023. ASCENIV growth continues to be driven by its uniqueness amongst immune globulin product offerings and the real-world impact and improvements the drug is having on outcomes for problematic immune-deficient patients. Furthermore, we're seeing encouraging signs of patient and prescriber persistence among those who have been using the drug for as long as three years. This dynamic is being compounded by record expansion of new accounts and reorder velocity among existing customers. We believe that the product will continue to account for a greater share of our overall product mix going forward. We are pleased to announce that during the first quarter and into the second, ADMA made progress advancing its recently identified growth opportunities. To reiterate, the incremental investment required to pursue these opportunities is not significant and is not expected to compromise ADMA’s robust profitability outlook. First, among these opportunities, ADMA successfully commenced manufacturing of ASCENIV at the 4,400-liter production scale for the first time in our corporate history. We expect the expansion will meaningfully improve the product's margin profile and increase our plant production capacity as fewer batches will be needed to support our revenue goals. The expanded scale provides for uninterrupted production to support our forecasted rapid growth trajectory. We believe these benefits could be realized as early as the second half of 2023. The second growth opportunity we've identified pertains to yield enhancement with our manufacturing and production processes. Recently, the company progressed with development scale and laboratory analysis, advancing ADMA’s initiative to capture additional immunoglobulin production yields. Pending further evaluation, validation of commercial-scale production, and ultimately regulatory approvals, these yield enhancement initiatives could meaningfully increase both peak revenues as well as margin potential if successful. Finally, our ongoing post-marketing clinical studies progressed as planned during the quarter. And if successful, may provide for label expansion opportunities for both BIVIGAM and ASCENIV to include pediatric-aged primary humoral immunodeficiency patients, as well as additional publications supporting the product safety. The potential label expansion we believe would put ADMA’s immune globulin portfolio on a level playing field compared to peer immune globulin offerings. Again, these opportunities represent potential upside to currently provided financial guidance. We look forward to updating the market as developments unfold. On the plasma supply front, our strong RSV hyperimmune plasma and normal source plasma inventories presently on hand are expected to support all upwardly revised revenue forecasts for our immune globulin portfolio. We believe that the rapid expansion of our internal collection network coupled with our existing contractually secured third-party supply contracts provide financial and supply chain flexibility. Currently, all 10 plasma collection centers in our network are operational and of those, eight are now FDA licensed. We continue to anticipate achieving complete FDA licensure of our BioCenters’ network as well as plasma supply self-sufficiency prior to year-end 2023. In a moment, Brian will describe in more detail the credit agreement we announced last week. But from my perspective, we are pleased to have reduced our interest expense by 1% and we believe the restructuring of the prepayment mechanism provides for additional strategic and financial flexibility. Considered in conjunction with the increased operating forecast we have announced today, we believe an opportunity exists to accelerate net income profitability earlier than previously provided in our timelines. We sincerely appreciate Hayfin’s continued and collaborative support. Our employee's commitment, passion and diligence drive our success. We have prioritized the human connection in all engagements through cooperation and teamwork among staff, leadership and our advisors. Our team's unwavering connectivity has enabled us to assume complete end-to-end control of operations, fulfilling our core vision and providing the foundation for continued success moving forward. We thank our staff for rising to the challenge daily, delivering on our pledge to patients, the medical community, prescribers, advocacy groups, and our stockholders. Your efforts make a meaningful difference in the lives of those counting on us. Before turning the call over to Brian, I'd like to confirm that our strategic alternatives process remains ongoing, and exploring value-creating opportunities remains a top priority for our company. The strategic alternatives process is separate and running in parallel to our pursuit of new growth opportunities. As developments occur, we will keep the market updated. With that said, I'd now like to turn the call over to Brian for a review of our first quarter 2023 financials.

Thank you, Adam. We issued a press release earlier today outlining our first quarter 2023 results and we will be issuing our first quarter 10-Q later this evening, which we would encourage you to read in conjunction with our comments and discussion points we will make during today's call. I'll now discuss some of the key highlights from the quarter. As Adam mentioned earlier, total revenues for the three months ended March 31, 2023 were approximately $56.9 million as compared to $29.1 million during the three months ended March 31, 2022, representing an increase of $27.8 million, or approximately 96%. The increase is attributed to higher sales of our immune globulin products, driven by increased physician, payer, and patient acceptance and utilization, as well as expansion of our customer base. During the quarter, we also benefited from an increase of $4 million in sales of normal source plasma through our ADMA BioCenters segment, as we fulfilled our long-term plasma supply commitment for 2023 with our third-party customer. Throughout the remainder of 2023, we anticipate using all of the plasma collected from our BioCenters network to support our IVIG production operations. Our gross profit for the first quarter of 2023 was $16.5 million. This translates into a 29% gross margin as compared to $3.7 million, or a 12% gross margin for the same period a year ago. This gross profit improvement of approximately $13 million was primarily driven by the revenue increases and the reduction in other manufacturing costs related to an extended routine plant shutdown in the first quarter of 2022. Partially offsetting the favorably evolving product mix, ADMA sold the substantial majority of the remaining lower margin 2,200-liter scale BIVIGAM product during the first quarter of 2023. As we move forward, production throughput and sales recognition is anticipated to be substantially confined to the higher margin 4,400-liter BIVIGAM product along with ASCENIV. Our consolidated net loss for the quarter ended March 31, 2023 was $6.8 million compared to $25 million for the first quarter of 2022. The $18.2 million decrease in net loss was mainly due to the narrowed operating loss of $14 million period-over-period and the loss on extinguishment of debt of $6.7 million we recorded in the first quarter of 2022, which is in connection with the refinancing of our senior secured credit facility, partially offset by the increase in interest expense. Our adjusted EBITDA increased by $14.2 million for the three months ended March 31, 2023, as compared to an adjusted EBITDA loss of $11.7 million for the same period over a year ago. The adjusted EBITDA improvement was driven primarily by increased sales, improved gross profit, and lower total operating losses. As Adam indicated, the recent credit amendment with Hayfin provides for multiple favorable changes. First, there's the reduction of 1% in the nominal interest expense on ADMA’s current note. This will result in a lowered borrowing rate of SOFR plus 8.5%. Included in this base rate and consistent with the existing terms of the Hayfin facility, the company may elect to pay up to 2.5% of the interest in kind with the remaining portion of the interest payable in cash. Second, within the first 24 months after the amendment closing date among other provisions, there's a newly structured 50% waiver of the prepayment fee in connection with an acquisition of the company or other certain strategic transactions. Taken together, we believe these changes will reduce ADMA’s cost of capital and provide for added financial flexibility over the near term and on an ongoing basis. In addition to the further enhancements of the capital structure, ADMA's balance sheet remained strong. At March 31, 2023, ADMA had working capital of $227.4 million, primarily consisting of $164 million of inventory, cash and cash equivalent of $69.2 million, and $26.5 million of accounts receivable. This was partially offset by current liabilities of $36.7 million compared to a working capital balance at December 31, 2022 of $231.1 million. Lastly, our ADMA BioCenters plasma collection network now consists of eight FDA licensed collection centers, with two additional centers operational and collecting plasma, which are pending FDA licensure. The company remains on track to have the remaining two BioCenters FDA licensed by the end of 2023, and in the same period forecast raw material plasma supply self-sufficiency from all 10 centers. Now well into 2023, we are encouraged by the real-time improvements in donor foot traffic and collection volumes, which are now considerably exceeding our organization's pre-pandemic levels.

Thank you, Brian. As demonstrated over the last two years, we take a conservative approach to guidance construction, contemplating a range of both macro and company-specific variables. That being said, today, we are pleased to be increasing total revenue guidance, which is now expected to exceed $220 million. Further, we anticipate continued adjusted EBITDA growth from the newly established first quarter base. Growth in business trends are strengthening and the forward-looking visibility required to meet or exceed our financial targets is as clear as ever. We believe our investments in the supply chain and commercial infrastructure in recent years have created a solid foundation for maintaining best in class revenue growth and potentially achieving an ultimate margin profile at the upper bound among plasma product manufacturing peers. Additionally, we've taken a thoughtful approach to pursuing new growth opportunities. We continue to progress with these projects, which we believe have the potential to yield further upside to what we already anticipate will be a highly profitable growth cycle over the near and longer term. We look forward to building on the momentum of early 2023 to drive further success. In closing, I'd like to thank you, our stockholders, for your continued support as your investment in ADMA helps to advance our mission to save lives and make high-quality, safe, and efficacious products that help our friends, family, and neighbors. Please donate plasma and help save lives. With that, we'll now open up the call for your questions. Thanks everyone. Thank you, operator.

Our first question comes from Elliot Wilbur of Raymond James.

Just wanted to extend my congratulations to management and the entire organization on all year accomplishments of the past couple of years. It's been a terrific journey and certainly have enjoyed being able to observe it from my analyst seat. And obviously, congratulations on the achievement of first-time positive EBITDA. I know there's been a lot of blood, sweat, maybe even a few tears invested behind that over the years, but obviously a significant milestone for the company. First question, it has to do with the revenue trends over the balance of the year and just looking at the over-performance in the first quarter and then sort of taking literally the low end of your guidance, which would be $220 million, that would imply the possibility of a sequential step down at some point over the next three quarters. Markets obviously have become accustomed to sequential positive top-line growth over the past couple of years. But just wanted to get your thoughts around the likelihood or whether or not there's something more definitive that would, in fact, we'd actually see revenue step down over one of the next three quarters before resuming growth?

Elliot, we're always conservative in our guidance, but we continued to reiterate that we anticipate quarter-over-quarter growth. Certainly, in the first quarter of this year, we had outsized plasma revenues from our plasma collection business. These plasma revenues will not recur going forward, but I'll tell you that the demand that we're seeing for ASCENIV and BIVIGAM, the demand that we're seeing for our intermediate fractions and even NABI, we are very, very bullish on the continued top-line growth, as well as trends for continued EBITDA and potentially even bringing profitability a little bit earlier than anticipated. So we really are confident here. In the prepared remarks, you heard me say a couple of times that it's still early in the growth trajectory for ASCENIV and we do feel that the way that the product is being perceived, the way that we are seeing patients getting added to the program, we think that the growth is only going to continue. So we feel very strong about our prospects financially going forward. The first quarter had some headwind still. The revenues consist of some of the lower margin BIVIGAM that we have been talking about over the last few quarters. We have exhausted most of that inventory. So we really feel very good about the forward-looking prospects of enhancing EBITDA, getting to net income profitability possibly a little bit earlier, but ultimately top line. Are the beats going to be as big as they have been? I don't know. Is the quarter-over-quarter growth going to be as big? I don't know. But we are committing to quarter-over-quarter revenue growth, and my hope is that it continues. I mean, the staff is working. Our company has never been more unified. The staff is working extremely well from what we do here in Boca, from making the product all the way through to our commercial folks, plasma collection trends look great. I mean, everything really falling into place right now, and we feel really strongly that this is only the beginning and it's going to continue.

I have a follow-up question for Brian regarding the reduction in plasma center operating expenses, which showed a significant sequential decrease. I assume this isn't an actual cost reduction, but rather an allocation or capitalization of those expenses instead of running them through the P&L. Is this quarter's number indicative of a new baseline, and will costs remain at these levels moving forward? I'm trying to understand the trend. Additionally, one of the larger fractionators reported a notable reduction in their COGS during their conference call, citing a significant decrease in collection costs, which they noted declined by 25% to 30% and contributed to their improved margins. Are you observing a similar trend in your actual collection costs?

Thank you for your insightful observation regarding the costs associated with plasma centers. As we move through the year, we anticipate that these costs will remain stable, much like what we experienced in the first quarter. The decrease observed from the first quarter of 2022 to the first quarter of 2023 is largely due to the increase in the number of centers that have now entered the maturity phase of collection. For example, in the first quarter of 2022, we had seven centers operational, whereas now we have ten centers fully open and collecting plasma. Additionally, while we had five FDA-approved centers in the first quarter of 2022, we now have eight. This means that the majority of our centers are now more established and are collecting plasma at higher volumes than they were a year ago. We expect the $1.8 million figure from the first quarter of 2023 to remain fairly steady for the remainder of the year as we can allocate more of these costs to inventory, impacting the cost of sales related to revenues. In regard to comments surrounding plasma collection fees and overall expenses, we refrain from discussing competitors and their market statements. However, we have noticed that donor fees in certain regions are decreasing, and some programs that were introduced a year or two ago during the COVID pandemic have been phased out due to the conclusion of specific government incentives and stimulus initiatives. While we aim to stay competitive as a collector, our focus goes beyond just donor fees; we take pride in the quality of our centers and the feedback we receive from our donors. They frequently commend our centers for their professionalism, cleanliness, and welcoming atmosphere, which contributes to the overall experience. We are indeed very proud of our organization and particularly our plasma collection centers for their exceptional maintenance and the professional treatment of our donors.

And final question for Adam. Just thinking about the incremental opportunity in the pediatric population, my assumptions are that the pediatric population is about 10% to 15% of the total, and I'm wondering if that's consistent with the company's thinking. And then just looking at some of the timelines associated with the ongoing studies, it looks like the BIVIGAM study may have been completed already. And I'm wondering if that information's been submitted to FDA as of yet. And I'm assuming that ASCENIV would still be on track to have the actual data submitted to the FDA by the end of the year, I want to confirm that. And then wondering, is there a case to be made for higher relative utilization of ASCENIV in the pediatric population than what you're currently seeing across the current patient base, either just based on higher comorbidities, such as asthma and ear infections, or because there's just a naturally higher rate of IVIG non-responders in the pediatric population?

So I don't think the 10-Q has been filed yet, but I remember us editing the section. Yes, the BIVIGAM study is fully enrolled and is completed. I believe that we're working through the data sets and that'll be submitted imminently to the FDA. ASCENIV study is ongoing and enrolling, and we're going to be asking for an extension to keep that study open for a period of time, and we'll update the market in the queue as that progresses. Regarding the pediatric indication, I've talked about this before on calls. I know people out there are going to go back and look at what I said historically, so I don't want to misspeak. But we don't view the pediatric indication as something that we absolutely need in order to grow this product. It'll put us on a level playing field with other immune globulin offerings in the United States, both from a subcutaneous and an IV standpoint. It's a legal requirement that the FDA has that manufacturers complete pediatric obligations and pediatric studies for ASCENIV. I don't want to misspeak, but I think we have age 12 up to 65 BIVIGAM. We didn't run that study; we inherited that product when we acquired the assets back in June of ‘17. That product, I want to say, is 18 and up. But we're not looking at it as it's really going to expand the market. I mean, for ASCENIV specifically, as you were asking, it's for problematic primary immune-deficient patients, full stop. For patients that are not responding on their existing immunoglobulin, it's for patients that have chronic and persistent infections, be it young or old. Problems don't discriminate whether you're a child or whether you're an adult with a primary immunodeficiency. I don't have the data in front of me on the spread, but I'm going to go out there and say that the majority of utilization with ASCENIV is currently on label, it's in patients that have had primary immunodeficiency for a while, that have experienced multiple immunoglobulins over the course of their treatment journey. They've changed brands, they've had dose escalations, they've been on antibiotics for multiple months and years at a time. And it's a product that really the real-world evidence is demonstrating that it's doing something unique and different out there. So we feel good about the product; we feel good about how it's differentiated in the market and that the only product that's manufactured by blending RSV plasma and normal source plasma. And just to circle back to your question, the pediatric indication is something that we believe that we should obtain, but it should not impact our ability to grow revenue for BIVIGAM or ASCENIV into the future. Hopefully that answers your question.

Our next question comes from the line of Anthony Petrone of Mizuho Securities, USA.

Thanks, and congratulations again here on another strong quarter, strong start to the year 2023. Maybe Adam to start, we can talk a little bit just about hyperimmune globulin specifically. Certainly, there's momentum in ASCENIV here; your prepared remarks point towards stickiness but also continued new patient volumes for ASCENIV. And then your competitor and supplier Grifols also reported a very strong hyperimmune globulin number for their quarter and 1Q of ‘23. So maybe just to level set us a little bit here on the state of hyperimmune globulins and then specific to ADMA just the tailwinds we're seeing in ASCENIV, how sustainable is the momentum in new patient starts, and over time how sticky can this prove to be on those patients as we continue to move ahead here? And then I'll have a couple of follow-ups.

What I can say is that while you mentioned Grifols, we operate in completely different areas. Most of their hyperimmunes come from their rabies product, which is not a market we compete in. They also have products related to tetanus and Rho(D) immune globulin, competing more with CSL and others. It’s a distinctly different space. However, I agree that the use of hyperimmune globulin tends to be highly consistent and standardized. Regarding ASCENIV, we have consistently stated for more than a year that patients transitioning from their regular immunoglobulins to ASCENIV show strong persistence in ordering and utilization trends. This is evident from our quarter-over-quarter growth and the fact that we are achieving EBITDA results sooner than we expected. This clearly indicates that the demand for ASCENIV is increasing. We have a solid understanding of our distributors' purchases. I often say it feels like I have tomorrow's news already, as I can predict our sales for the second quarter. I wouldn't confidently discuss our expected growth if I didn't believe our utilization was stable. The patients are thriving on our drug. We have all learned a lot, and it’s important to note that, despite not wanting to reference COVID frequently, there is a growing consensus among patients and physicians that having more antibodies is beneficial for treating or preventing infections. The only way for immune-compromised patients to get antibodies is through immune globulin replacement therapy, and our product uniquely screens donors. Although it's not specifically an RSV drug, we use RSV to identify hyperimmune donors, who have shown high titers to various respiratory viral pathogens. The scientific understanding suggests that these donors may have higher titers against other viral and bacterial infections, contributing to positive patient outcomes. Doctors continue to order our product, payers are reimbursing, and our distributors are restocking, indicating a robust demand. I do get a bit anxious at the beginning of the year due to changes in insurance plans and CMS rules, but we have faced minimal attrition. Payers and doctors recognize that patients are doing well—avoiding hospitalizations, opportunistic infections, and persistent issues. They are prospering. We have marketing initiatives underway, including patient testimonials, and we're looking to expand this because while the product is still relatively new, we have patients who have been on therapy for years and are eager to share their positive experiences. There’s a strong sentiment among them that they weren't doing well before they began using our product, and they have seen a significant improvement, which reinforces my confidence in its stickiness. Our commercial team assures me that we are on the right track. I am committed to continued quarter-over-quarter growth and feel very positive about our prospects.

No, that's great and obviously evident in the results here. Maybe Adam, a couple of quarters now you're talking about newly identified growth initiatives the company's pursuing, and don't want to zone in on the yield enhancement initiative. Maybe just if you can to give us a little bit behind the scenes there, maybe where is the Boca facility today in terms of yield when we think of grams per liter and where can that go over time, and maybe what's the path forward? I mean, how much testing has to be done and what type of regulatory pathway do you need to pursue?

We are genuinely excited about the new growth opportunities we see as transformative for our business. I am particularly pleased about ASCENIV at the 4,400-liter scale, which I previously thought we would never pursue. However, we've successfully produced a couple of batches, and I am thrilled because this will enable us to process more plasma through the plant and better manage our manufacturing overhead. We believe margins for ASCENIV could improve; historically, we've seen gross margins around 80%, but there’s potential for it to move into the upper 80s or low 90s. This could significantly lower our cost of goods sold while absorbing manufacturing overhead. As for yield enhancement, this is a truly transformative initiative. Though I don't want to get overly optimistic, the data shared with me has been very encouraging. Historically, our yields have been around 3.8 to 4.1 grams per liter. Some competitors might achieve slightly higher yields, but I prefer our centrifuge method, which treats proteins gently. I expect significant improvements in our yields, which could change the dynamics of our business. While our current profitability targets don’t factor in yield enhancements or the 4,400 ASCENIV product, I believe these targets could continue to grow. Regarding the regulatory process, I want to clarify that the budget for this work is manageable, especially considering the overall value of our assets. The timeline will depend partly on our bench-scale work, but I assure you that the team is enthusiastic and fully engaged in this endeavor. We have a model running continuously, and we are developing our regulatory strategy. Based on past successes, we are confident in our approach to achieving regulatory approvals. In summary, our company is undergoing a transformation. We are increasing our sales of ASCENIV and BIVIGAM while finding efficiencies across the organization. Our unified team is dedicated to improving the lives of immune-compromised patients. I don't have a precise timeline to share yet, but we are committed and our conservative approach is well-known. As we look ahead, we're optimistic about our growth targets, projecting approximately $250 million in revenue next year and $300 million by 2025. Our margins are set to improve as we produce more from the same resources, addressing investor concerns about profitability. ADMA Biologics is becoming a more formidable company, moving to a new level where our market capitalization should reflect our growth and success. The yield enhancement strategy will only strengthen our position further.

Well, with that, I'll hop back in queue as they say, you guys have arrived again. Congratulations on the quarter and we’ll talk soon…

We have a lot more to do, Anthony. We're not there yet. The team knows it. We are not stopping here. We have got a lot more growth. And I want that net income. When we hit net income, I told Skyler, I wouldn't say this, but I'm upset that the Rangers lost. But only then will I be able to die in peace when we have net income profitability. So I want to get there fast, but thank you. Thanks for the kind words.

Our next question comes from the line of Kristen Kluska of Cantor Fitzgerald.

Let me also add my congratulations to you on another great quarter and the pattern that we've really seen emerge over the last couple of quarters here. So I wanted to ask you a bit more on ASCENIV utilization. If I look at some of your publications, posters, et cetera, it really seems that the benefits are quite broad. I mean, the age of the patients, the underlying comorbidities, the time to treatment, it seems pretty diverse amongst the patients yet the benefits are all there. So curious if real-time you are seeing that the effects represent a broad patient population or if there is a specific type that you’ve seen? And then can you talk about some of your plans maybe in the next 12 months to collect and report on more of these case studies?

I understand your question, and I want to emphasize that we have a diverse population of patients. Primary immune deficiency disease (PIDD) affects individuals in various ways. Our marketing efforts are concentrated on immune deficient patients, both primary and secondary. We are specifically targeting infection disease and clinical immunology conferences. Each patient has their own unique treatment journey, which is essential to recognize. While I can’t provide a precise profile of a patient, you can visit the ASCENIV website for an overview of the common comorbidities associated with the broader PIDD population that we aim to serve. However, identifying beforehand which patients may not respond well to standard immunoglobulin therapy remains a challenge for doctors. Most of the patients we encounter have typically been on immunoglobulin therapy for a year or longer without success. They often come to us after experiencing issues with their previous treatments. This factor unites many of our patients. If we were to have an ASCENIV support group, many would likely share experiences about switching to our product after not doing well with prior therapies. There is still a significant portion of patients receiving immunoglobulin therapy that we have yet to reach, indicating that there is ample opportunity for growth.

And I know one avenue for the quarter-over-quarter revenue growth has been due to the product mix and the associated margins. But you did point out specifically for this quarter that you're seeing a record number of patients as well. So wanted to ask what's been the key factors, if you can dig into this trend, is it greater awareness, is it just a continuous unmet need? What are you seeing to kind of get to these record number of patients now?

No, I appreciate the question. And not to use my Shark Tank analogies, but I think we've really locked in on how to acquire customers, and we are spending only on programs that really target our patient population. Our MSL team, our medical affairs team is doing a great job and I think that they really understand the drug. And I think that our sales force is pounding the pavement; they love traveling and I've never seen a group of people that are more dedicated. But they're out there, and we're hitting all the right meetings, we're hitting all the regional meetings, we're hitting all the right outpatient infusion companies, and we're talking to docs. We're sponsoring medical education programs; we sponsor the Clinical Immunology Society Summer school. I mean, we're doing things that are really meaningful and I think are impacting. And look, again, it's still a new product, and we still have a lot of room to grow, as I've said a couple of times today. But what I'll say is that the awareness is there. I believe that in our small subset of clinical immunology, physicians and infectious disease consults to the clinical immunology programs, this is not something that they haven't heard; they've seen it at IV week, they've seen it at CIS, at Quad AI for multiple years. And I think people have asked that question. I'll tell you that our commercial force, MSL, market access, reimbursement, national accounts, and ultimately sales and marketing, when they're at these shows, no one's saying it was a dead show; we didn't get a lot of leads. People are continuing to come up and ask us questions, explain to me how this is made, explain to me why this is different. Explain, explain, explain. I mean, we wouldn't be investing in these programs if we didn't see that we were gaining penetration from it. So what I can say is that I'm really excited about the patient testimonial campaign that's going to be rolling out there. I think it's meaningful to the nurses that attend these meetings. They spend a lot more time with the patients and the docs. And I think that the doctors are really seeing that they've got something in their armamentarium that is not an end-all-be-all, but it certainly is something different that helps move to take forward, and we think the trends are going to continue.

Ladies and gentlemen, this will conclude our question and answer portion of the call. I'd like to turn it back to Adam now for additional closing remarks.

I want to express my gratitude to our staff. It has been a challenging journey for all of us. Some of you have been with us for a long time, while others are newer, but we couldn't have done this without each one of you. To our shareholders, we appreciate your patience, and we are finally demonstrating EBITDA profitability. We will continue to set conservative expectations and exceed them. So please continue to support us. Thank you again for your trust and support. Today is truly an exciting day for us at ADMA Biologics, and I hope everyone listening feels proud, as I am proud to lead this organization that significantly impacts the lives of patients who may not have a voice. With that, have a good evening. Please consider donating plasma; it can help save a life. That's all I have to say. Have a great evening.

Ladies and gentlemen, this does conclude the conference call for today. We appreciate your participation, and you may now disconnect.