Operator
Good afternoon, and welcome to Cumberland Pharmaceutical 2025 Financial Report and Company Update. This call is being recorded at the company's request and will be archived on its website for one year from today's date. I'd like to turn it over to Emily Kent from Dalton Agency, who handles Cumberland's communications. Emily, please proceed.
Thank you, everyone, and thank you for joining us today. This afternoon, Cumberland issued a press release announcing its annual and fourth-quarter financial results. The release also provided an overall company update, including key developments during the year. The release, which includes the related financial tables, can be found on the company's website at www.cumberlandpharma.com. During today's call, management will share an overview of those financial results and a company update, including a recent development and a discussion of Cumberland's brands, pipelines, and partners. Participating in today's call are AJ Kazemi, Cumberland's Chief Executive Officer, Todd Anthony, Vice President, Organizational Development, and John Hamm, Chief Financial Officer. Please keep in mind that their discussions may include some forward-looking statements as defined in the Private Security Reform Act. Those statements reflect the company's current views and expectations concerning future events and may involve risks as well as uncertainties. There are many factors that could affect Cumberland's future results, including natural disasters, economic downturns, international conflicts, trade restrictions, public health epidemics, and others that are beyond the company's control. Those issues are described under the caption, Risk Factors, in Cumberland's annual report on Form 10-K and any subsequent updates filed with the SEC. Any forward-looking statements made during today's call are qualified by those risk factors. Despite the company's best efforts, actual results may differ materially from expectations, so information shared on this call should be considered current as of today only. Also, please remember that the company isn't responsible for updating any forward-looking statements, whether as a result of new information or due to future developments. During today's call, there will be references to several of Cumberland's marketed brands, Full prescribing and safety information for each brand is included on the individual product website, and you can find links to those sites on the corporate site at www.cumberlandforma.com. The company will also be providing some non-GAAP financial measures with respect to its performance. An explanation and reconciliation to GAAP measures can be found in the tables of the earnings release that I noted was issued earlier this afternoon. If you have any questions, please hold them until the end of the call, at which point we will be happy to answer them. Management is also prepared to hold a follow-up conversation with shareholders after the call if you prefer. With that introduction, I'll turn the call over to Cumberland Chief Executive Officer A.J.
Thank you, Emily, and good afternoon, everyone. We do appreciate your joining us today. As Emily mentioned, we'll provide a review of both our also share and discuss several recent developments that continue to underscore our company's future. I'd like to start by stating that 2025, highlighting a year of considering unique product, let's begin with a review of FDA-approved 25, representing 18%. Double-digit revenue resulted in a turnaround in adjusted earnings, which improved by over $2 million to $1.7 million, or $0.11 a share. In addition, cash flow from operations improved by just under $5 million for the full year. This financial performance reflects strong execution across our commercial organization with growing demand for our product. by dramatic growth, along with the initial sales of our newest brand, Helicia, which we began shipping and strengthened our balance sheet during the year. We increased shareholder equity in $10 million, and beyond our financial performance, we made significant progress, expanding our global presence. 2025, ViBATF received regulatory approval in China, the world's second largest pharmaceutical market, creating a major new opportunity for the brand. Also in 2025, ViBATF was successfully launched in Saudi Arabia, resulting in initial sales in the first patients receiving treatment with the product in that country. Ibuprofen injection product received regulatory approval in Mexico, which will enable our expansion into another important international market. Now to our business development efforts, we continue to execute on our strategy of acquiring rights to differentiated branded pharmaceuticals. We added Tilesia, an FDA-approved treatment for helicobacter pylori infections, expanding our presence in gastrointestinal care. Tilesia complements our existing portfolio and represents an excellent strategic fit, leveraging our established commercial infrastructure. Meanwhile, the Centers for Medicare and Medicaid Services, or CMS, issued a J-code for Caldilor. This important reimbursement milestone enhances product access, simplifies hospital billing, and further supports Caldula's continued growth and its role as a standard of care for the treatment of pain and fever. During 2025, we also continue to advance our clinical programs, reinforcing our commitment to developing new therapies for patients with serious and underserved medical needs. Significantly, we continue to advance our clinical pipeline in 2025, highlighted by breakthrough results from our FITE-DMD clinical study in patients with cardiomyopathy associated with Duchenne muscular dystrophy, which is the leading cause of death in those patients. The top-line findings from that study were selected for a late-breaking presentation at the Muscular Dystrophy Association's Clinical and Scientific Conference and were also presented at the Parent Project Muscular Dystrophy Annual Conference. We then completed the comprehensive analysis of the study results, prepared our clinical study report, and then submitted it to the FDA and began interactions with them to determine their remaining development requirements. The FDA has approved our request for orphan drug, rare pediatric disease, and more recently, fast-track designations for our DMT program. Fall 2025 was a defining year for Cumberland's financial business, advanced our development pipeline, expanded our global footprint, and strengthened our financial foundation. So, with that overview and developments, I'd now like to turn to Todd, Anthony Cumberland's Vice President in Organizational Development, to further discuss both our brands and our organization.
Well, thank you, AJ. I'll start by sharing an update on each of our major brands. Vibativ is our intravenous antibiotic designed for difficult-to-treat infections, such as hospital-acquired and ventilator-associated pneumonia as well as complicated skin and skin structure infections caused by certain gram positive bacteria including those that are multi-drug resistant. Unlike many antibiotics that are losing the ability to fight bacteria, Vibativ's unique dual method of action was specifically designed to address drug-resistant bacteria. We therefore believe it has life-saving potential to help many patients amid this growing antibiotic resistance crisis, which faces a fragile pipeline of new antibiotic development. Recall that to reinforce this message, we are conducting a series of infectious insights, which are discussions with infectious disease experts that we're disseminating across the These video vignettes share the opportunity to use Vibatib as a solution for select patient types where other products have failed. We also shared that a comprehensive pharmacokinetic analysis of Vibativ was published in Antimicrobial Agents and Chemotherapy. The analysis utilized data from over 1,200 patients across varied demographics and comorbidity profiles. The findings support optimized dosing strategies for patients with different infection severities and renal function levels, reinforcing Vibativ's critical role in treating life-threatening, gram-positive infections. In 2025, we also announced the availability of the Vibativ 4-Vial Starter Pack through a new supply arrangement with Vizient, making it accessible to their health care members nationwide. As the country's largest provider-driven health care performance improvement company, Vizient serves more than 65% of the nation's acute care providers, including 97% of our country's academic medical centers. Through this agreement, Vizient members have access to Vibativ's four-vile configuration, which supports flexible treatment initiation in both an inpatient and outpatient setting for this potentially life-saving therapy. Vibativ was also added to a national group purchasing agreement with Premier Incorporated, an alliance of approximately 4,350 U.S. hospitals designed to drive transformation across the healthcare system. The product's addition provides Premier's membership with a cost-effective solution to treat resistant gram-positive infections. Moving next to Crystallose, which is our prescription strength laxative provided in a convenient, pre-measured powder dose that dissolves quickly in just four ounces of water, resulting in a clear, taste-free, and grit-free solution. While our field sales division has been able to generate prescriptions of Crystal Lose through their promotional efforts, we have always faced substitution by pharmacies in favor of generic alternatives. That substitution has increased this year with the arrival of additional generic competition. We have taken appropriate action and are implementing strategies to protect and grow this business. Let's shift now to Caldolore, our intravenous ibuprofen product. With its newest pediatric labeling cleared with the FDA, Caldolore now is the only non-opioid product approved to treat pain in infants that's delivered by injection. As a reminder, we are featuring Caldolore through sales and marketing initiatives, highlighting this new indication, resulting in a growing use of the product in our country's children's hospitals. In 2025, we announced the publication of our study investigating Caldolore in clinical therapeutics, demonstrating the product's safety and efficacy for managing postoperative pain in patients 60 years of age and older. The analysis encompassing over 1,000 patients from our comprehensive post-surgical study represents the first such evaluation in this vulnerable population where traditional pain management options such as opioids carry increased risk. Turning now to Sancuso, our transdermal patch, FDA approved for the management of chemotherapy-induced nausea. We continue to see favorable sales results following expansion of our oncology division. We have also launched a new Sancuso website, along with promotional marketing resources and digital marketing campaigns to further support awareness and access to this product. Lastly, let's review our newest product, Talicia, an FDA-approved and leading treatment for Helicobacter pylori infections. Provided in a single capsule that contains smeprazole, amoxicillin, and rifabutin, Talicia is now recommended as a first-line therapy for H. pylori infections via the American College of Gastroenterology's clinical guidelines. Also note that the effective treatment of gastric ulcers is an important step in the prevention of gastric cancers. Our outstanding profile includes three key advantages, a high eradication rate exceeding 90%, the convenience of an all-in-one capsule, and minimal antibiotic resistance. In 2025, we entered arrangements with Redhill Biopharma to jointly commercialize Talicia and formed a new company with Redhill named Talicia Holdings Incorporated. Through our co-commercialization agreement, we have assumed responsibility for the distribution and sale of Talisia in the U.S. and equally share Talisia's net revenues. We launched the promotion of Talisia at the beginning of the year, and our newest brand is supported by our field sales division that also details crystallose. We now have a national sales and medical organization that includes 50 customer-facing individuals who feature our brands. Well, that completes my updates for today, so I'll turn it back to you, AJ.
Well, thank you, Todd. I'd now like to provide an update on our ongoing clinical activity. Continue to progress our pipeline of innovative products designed to improve patient care and their quality of life. Our Fitterband product candidate, a potent and selective thromboxane receptor antagonist, is being evaluated in several clinical programs for patients with a series of unmet medical needs. It's now been dosed in nearly 1,400 subjects and has been found to be safe and well-tolerated in those individuals, resulting in 25 top-line results from our completed Phase II study in patients with the cardiomyopathy associated with Duchenne muscular dystrophy, which is a rare fatal genetic neuromuscular disease that results in deterioration of the 41 DMD patients who received either low-dose ifitraban, high-dose ifitraban, or placebo. High-dose ifitraban treatment resulted in a 3.3% improvement in the patient's left ventricular ejection fraction. Compensity-matched natural history controls, the difference was even more pronounced, with high-dose treatment providing a statistically significant 5.4% over-preasured by LVE. Doses of ifetraban, fanzine, subjects who completed the 12-month treatment period opted into an open-label extension where they continue to receive ifetraban with long-term follow-up. Previously received orphan drug designation, also recently granted by the FDA fast-track designation and that will enable us to have more frequent FDA interactions and also enable us to submit our application for enrolling basis. The FDA last fall findings from our study also been evaluating on patients. Enrollment in this study was completed last year and we look forward to announcing the top line findings this year. In addition, we have a phase 2 clinical study, the Fighting Fibrosis Trial, in patients with idiopathic pulmonary fibrosis, the most common form of progressive fibrosing interstitial lung disease. Patient enrollment is well underway in medical centers across the U.S., and the study includes both an interim safety analysis and an interim efficacy analysis. Today, I'm pleased to announce that the interim safety analysis was completed where it evaluated the first cohort of patients completing 12 weeks of independent committee safety signals no new safety signals identified and no changes in study conduct were necessary based on those findings enrollment has continued the interim efficacy results vision of a manuscript, The Use of Ifitraban to Target Platelet Tumor Interactions to Reduce Metastases in Triple Negative Breast Cancer. That publication came out last November. It was peer-reviewed, and it highlights the novel mechanism of ifitraban and its potential to address serious and difficult to treat. This script was accepted and published in the Journal of Experimental Hematology and Oncology, and we believe this recognition helps strengthen the scientific foundation supporting iFITRABAN and contributes to broader awareness in the scientific and medical community as we continue to also underway through several investigator-initiated trials. Based on the results from the FITE DMD study that I mentioned, we've decided to now pursue Do I fit your band's registration for the DMD-associated cardiomyopathy as our lead in the grossest protocol activities. And now I'd like to turn it over to our Chief Financial Officer, John Hamm, to review our financial results.
Thank you, AJ. For the three months ending December 31st, 2025, net revenue from continuing operations was $13.7 million, which represented a $3.2 million, or 31% increase. Net revenue by product for the fourth quarter of 2025 included $3.1 million for Crystallos, $3.3 million for Sancuso, $2.8 million for Vibatov, $0.9 million for Caldolore, and $3.3 million for Talicia. As a reminder, due to quarterly fluctuations in our customers' purchases, we believe our performance should be assessed based on annual sales results. With that in mind, I'm pleased to report that net revenues for the full year of 2025 were $44.5 million, a $6.7 million, or 18% increase, over the prior year. Full-year product revenues totaled $10.5 million for Crystallos, $11.9 million for Sancuso, $9.4 million for Vibatov, $4.7 million for Caldilor, and $3.3 million for Talicia. We also received a $3 million milestone payment associated with the approval of Vibatov to the Chinese market. Turning to our expenditures, total operating expenses for the fourth quarter were $15 million compared to $12 million for the prior year period. We did see an increase in operating expenses due to the higher royalties, cost of goods, and other items associated with the growth in product sales during the period. For the full year 2025, total operating expenses were $47.3 million compared to $44.3 million during the prior year. The net loss was approximately $1.4 million for the fourth quarter and $2.9 million for the full year, both significantly improved over 2024. When non-cash expenses are added back, the resulting adjusted earnings for the year were $1.7 million were 11 cents a share. In addition, cash flow from operations was $4.9 million in 2025. Also, please note that the adjusted earnings calculations do not include the additional benefit of the $0.2 million of IBATF cost of goods during the fourth quarter. Those goods were received as part of the product's acquisition. We're pleased to see that the additions of Vibatav, Sancuso, and Talicia to our portfolio are providing a significant positive impact to our financial performance. As a result of the Vibatav acquisition, a total of $34 million in new assets were added, including approximately $21 million in inventory, $12 million of intangible assets, and $1 million of goodwill. The estimated value of those assets was $10 million at the end of 2025. The financial terms for the Vibata transaction included a $20 million payment upon closing and a subsequent $5 million milestone payment. We also continue to provide royalties tied to product sales. Sancuso added a total of $19 million in new assets, including approximately $4 million in inventory and $14 million in intangibles. The estimated value of those assets was $10 million at the end of 2025, $13.5 million at closing for the Sancuso acquisition, and we paid $1.5 million in milestone payments. And there are ongoing royalties that we pay based on the brand's sales. We have formed a new company with Redhill Biopharma named Talicia Holdings, Inc. Redhill has contributed the worldwide rights to Talicia and the products assets to the new company. Cumberland invested two million dollars during the fourth quarter of 2025 and will provide another two million dollars later this year to participate in the new company's joint ownership. As a result of this investment, Cumberland owns 30% of the new THI and are accounting for this holding using the equity method. Turning to our balance sheet as of December 31st 2025 we had seventy six point eight million dollars in total assets including eleven point four million dollars in cash and cash equivalents liabilities total fifty two point three million dollars including five point two million dollars on our credit facility total shareholders equity was twenty four point nine million dollars at the end of 2025 bank line of credit which provides up to fifteen million dollars in capital the interest rate is based on benchmark term SOFR and is subject to a financial covenant determined on a quarterly basis and we were in compliance at the end of the fourth quarter. We also continue the process of implementing trading plans for our board members in 2025 who purchased Cumberland shares throughout the year to increase their holdings in the company. I'd like to note that Cumberland continues to hold over $54 million in tax net operating loss carry forwards, primarily resulting from the prior exercise of stock options. And that completes our financial report for the fourth quarter and full year 2025. Back to you, AJ.
Thank you, John. I'm very pleased with Cumberland's performance in 2025. We delivered strong sales, strengthened our finance, enhanced our commercial, and continued advancing our clinical programs. These achievements reflect the disciplined execution of our strategy and the growing impact of our products. We remain focused on delivering differentiated medicines that address meaningful patient needs. Advancing our development program, new treatment options, these accomplishments would not be possible without the dedication and experience of our team. We appreciate the continued support, once again targeting double-digit revenue growth, performance newest edition so again targeting meaningful options operator please thank you sir ladies and gentlemen that concludes the company's
Operator
presentation and we will now open the call for any questions if you'd like to ask the question please press the star key on your phone followed by the digit one twice that's star one one please stand by I just want to thank everybody for joining today's call.
We do understand many of our shareholders provide a private discussion with management, and if so, please just reach out, and we'll be happy to get a call scheduled with you and hold such a discussion.
Operator
Thank you, sir. Ladies and gentlemen, that concludes today's call. If you would like to listen to a replay of the discussion, please visit the Investor Relations section on Comforten's website. I'd like to thank you for your participation. You may now disconnect.
