Thank you operator.

Good morning and welcome to HARO's first quarter 2026 earnings conference call. My name is Mike Biega, Vice President of Investor Relations and Communications and I'm excited to be introducing today's call. The company's remarks may include forward-looking statements within the meaning of federal securities laws. Forward-looking statements are subject to numerous risks and uncertainties, many of which are beyond HARO's control, including risks and uncertainties described from time to time in its SEC filings such as the risks and uncertainties related to the company's ability to make commercially available its FDA approved products and compounded formulations and technologies and FDA approval of certain drug candidates in a timely manner or at all. For a list and description of those risks and uncertainties, please see the risk factor section of the company's most recent annual report on Form 10-K and subsequent quarterly reports on Form 10-Q filed with the Securities and Exchange Commission. Herald's results may differ materially from those projected. Herald disclaims any intention or obligation to update or revise any financial projections or forward-looking statements, whether because of new information, future events, or otherwise. This conference call contains time-sensitive information and is accurate only as of today. Joining me on today's call are Mark L. Baum, Chief Executive Officer, Andrew Boll, President and Chief Financial Officer, Pat Sullivan, Chief Commercial Officer, and Amir Shoujedi, Chief Scientific Officer. With that, I would like to turn the call over to Mark. Mark?

Thank you, and good morning, everyone. To begin, as a growth-oriented business, the fuel for our success is and will always be demand. Without buyers seeing value in Harrow's products, ordering and reordering them. We wouldn't have a business. So demand is the key. And from that standpoint, the underlying fundamentals of Harrow have never been stronger. While the headline revenue number this quarter reflects a specific isolated dynamic, let me be clear to my fellow stockholders. Our data demonstrates that demand for our key growth drivers is accelerating. Further, our market share capture is sustainable and will translate into profitable revenue growth. The $8 million revenue reduction in the first quarter was specifically tied to Vivi. As detailed in my letter to stockholders, the surge that we saw in demand from patients with high deductibles from this new band of commercial coverage that we were so excited about, it just outpaced our initial financial modeling assumptions. Andrew will discuss this in greater detail shortly. However, we identified this issue. We corrected it. And importantly, our fix to return to our net pricing assumptions has shown negligible impact on the underlying new prescription V-Li demand. That's the key. With the high deductible season largely behind us and new business rules in place, we expect to realize the full financial benefit of our expanded coverage moving forward, starting in the second quarter. I want to go back to demand, though, because a lack of demand in the face of a concerted commercial effort is nearly impossible to remedy. across our portfolio and specifically with our key growth driver products, we do not have that problem. In fact, demand trends are strong, even for what is traditionally a weaker first quarter period due to standard industry seasonality. Moreover, you've probably seen on LinkedIn that we've hired more than 90 new sales professionals. So our promised commercial investments, that is doubling our sales forces in dry eye and surgical and bolstering other teams are complete. We're now entering a period where the work we've been doing over the past several years is translating into meaningful, sustained growth and demand, and this will in turn convert to revenue. Across Vivi, IHISO, and TriEssence, our core growth drivers, we are seeing strong, durable demand trends that are at or above our internal expectations. And in our business, once again, operational issues, they can be fixed. A lack of demand cannot. Let me provide some additional color on a few key products. On Vevi, we are seeing record prescription growth, continued market share gains, and increasing prescriber adoption. The product has now reached a highly meaningful position in the market, having officially surpassed Zydra in total prescriptions as of the end of March, as we continue to close the gap with other category leaders. Crucially, this happened with half the number of reps we now have deployed. We are positioned to see this momentum accelerate, especially as we continue to successfully gain additional positive coverage changes, which we expect over the next 12 to 18 months. I'm especially pleased that more recently, we are seeing higher daily new prescription highs and higher lows. Breaking demand trend lines for a chronic care product to the upside is a very good thing. IHESO demand continues to build across both retina and in-office accounts. We're seeing record numbers of new accounts, and this trend has continued into the second quarter. We are still early in unlocking the full opportunity here. And as we move into the second half of the year with improved pricing, new packaging, and upcoming clinical data specific to IHESO in retina procedures, we're positioning IAESO for a step change in growth. Priessence is also demonstrating the kind of consistency that we expect. Even in what is typically a more challenging seasonal period for surgery, demand continued to grow sequentially with increasing adoption and strong reorder behavior. These are clear indicators that the product is gaining traction in clinical practice. Following my recent time in the field with several large new triessence accounts, it is clear to me that our expansion into the surgical inflammation market is bearing fruit and will be a part of our long-term revenue growth strategy. Our access plus cash pay business, which includes both our branded and compounded products, having successfully worked through prior inventory constraints, is also on track. We are currently increasing safety stock and expanding the Access Plus sales team, positioning this team to enter growth mode so we can deliver essential, affordable cash pay products that our customers rely on. As Pat will discuss shortly, these are the exact demand trends we look for across our portfolio. Growing demand signals, expanding account adoption, and improving execution, leading to greater breadth and depth within those accounts. As I look at HARO today, I've never been more confident about where we are or where we're going. Simply put, the business is positioned beautifully for the balance of this year and has never been more valuable. A few more points on the second half setup, though. One, as I mentioned, we made targeted high-conviction investments to scale our commercial platform and unlock the full potential of our portfolio. We recruited top talent to Haro. That work is now complete. We've built the commercial infrastructure, expanded our reach, and attracted the exact kind of talent that wins in this industry. What that means is straightforward. We now have the engine in place to convert the demand that we're seeing into sustained revenue and profitability performance. As we move forward, several factors support strong and sustainable growth. First, our core products operate in large, under-penetrated markets with significant runways ahead. These are not short-cycle opportunities. These are durable growth platforms. Second, awareness is building. New account starts are accelerating. Breadth and depth within accounts are expanding. And these factors drive the value of our products within our customers' practices in a highly meaningful way. Third, refill rates and reorder rates that are at or above our internal estimates support bullish demand metrics for our key products. And fourth, the most challenging part of the year is behind us. Some of you have heard one of my mongres, and that is that at Hero, we're not interested in mere activity. We celebrate economic accomplishment. We focus on economic accomplishment. And as we move through the balance of 2026, we expect to see accelerating momentum as our commercial investments fully translate into financial results or economic accomplishments. The non-recurring VVI revenue modeling dynamic does not change Harrow's trajectory. If anything, it reinforces how powerful the underlying business is and what can come from Levi, especially as these new patients refill their prescriptions in a profitable way for our stockholders. We are executing, building momentum, and it is clearly showing in the demand data. Because of this, underlying demand is tracking in line with or above our expectations, and therefore, we're fully reaffirming our 2026 revenue guidance of between $350 million to $365 million for the full year. Furthermore, this accelerating commercial engine underpins our unified corporate initiative to achieve $250 million in quarterly revenue by the end of 2027. I will now turn the call over to Andrew Boll, our President and Chief Financial Officer. Andrew?

Good morning, everyone. For the first quarter of 2026, we reported consolidated revenues of $44.2 million and adjusted EBITDA of negative $12.7 million. As we previously communicated, Q1 was expected to be the lowest revenue quarter of the year. This reflects several factors. As expected, a minimal gap contribution from IHISO as channel inventory is absorbed and software revenue from the compounding business as we worked through prior inventory constraints. Breaking down Q1 performance by product, Vivi generated about $20.9 million in revenue. IHISO contributed $1.9 million in line with expectations. Our specialty and triessence portfolio delivered $7.8 million and access plus revenue was $13.5 million. As Mark noted, during the quarter, we experienced a gross-to-net modeling dynamic related to the VVI coverage rollout, which resulted in a discrete reduction of reported revenue by approximately $8 million. To provide additional financial context, ahead of the January 1 coverage launch, we implemented business rules based on specific assumptions regarding patient mix and patient out-of-pocket costs. While January net pricing tracked in line with our forecast, its mix shifted sharply as the quarter progressed. We saw a significantly higher than anticipated proportion of high deductible patients filling prescriptions through their pharmacy benefit, and our average out-of-pocket buy-downs increased rapidly. This growing utilization drove incremental gross-to-net pressure beyond our internal assumptions, resulting in lower realized net revenue per unit for the period. Due to the standard industry lag in claims reporting, the full magnitude of this mixed shift was confirmed in mid-April. We acted immediately, implementing targeted business rule changes, including strict caps on copay buy-downs and other program refinements to protect our net pricing going forward. These program changes have isolated this to be primarily a first quarter issue, and we are now well positioned to receive the complete economic benefit we expect from our expanded coverage moving forward, beginning in Q2. Based on updated modeling and what we have seen through April, that pricing is much better aligned with our internal expectations and should be notably higher than in the first quarter. Importantly, early indicators prove these changes have not negatively impacted underlying demand or patient access to VIVI. Given these adjustments and current demand trends, we expect Levi to deliver sequential growth and remain fully on track to exceed our $100 million revenue outlook for the year. Looking ahead to the second quarter, we expect total revenues to be in the range of $71 to $81 million. At the product level, Levi is expected to show sequential growth. We should see IHESO revenue start back in Q2, though likely still below prior year levels due to channel dynamics and dependent upon stocking levels associated with our new FIFAC presentation. We will also begin to recognize initial revenues from BioViz as distributors take on initial stocking orders. As Mark already stated, we are reiterating our full year 2026 revenue guidance of $350 million to $365 million. Based on current demand trends and customer interactions, we expect the second half of the year to be even stronger than initially anticipated. We have clear visibility into several catalysts that support this robust second half, including continued growth in demand across our core commercial drivers, full deployment of the expanded Vivi sales force with a modest impact in Q2 and a highly meaningful contribution beginning in the second half of the year, realization of the full financial benefit from expanded coverage for Vivi following our mid-April business rule adjustments, the commercial launch of BioVase on July 1st, the permanent J code for iapidine 1% becoming affected July 1, potentially expanding utilization in the in-office procedural setting, an approximate 20% to 25% improvement in IHESA net pricing, along with the introduction of multi-unit packaging beginning in Q3. Upcoming clinical milestones for adhesives are including initial retina data at the ASRS meeting in July and top line results from the QOL study in the fourth quarter. And finally, continued growth in triassets, building on the momentum in ocular inflammation with a dedicated sales force that recently doubled in size. Taken together, these drivers give us high confidence in accelerating growth and improved financial performance as we move through the remainder of 2026. I'll now turn it over to Chief Commercial Officer Pat Kelvin.

Thanks, Andrew. Good morning, everyone. I will detail the commercial execution across our portfolio. The thread that runs through every one of these slides is exactly the same. Demand is accelerating, access is improving, and our scaled commercial organization is now actively converting that demand into revenue. Starting with V-Buy, the four numbers at the top of this slide tell the demand story. New prescriptions grew approximately 25% sequentially, total prescriptions grew about 11%, our prescriber base expanded by another 12% sequentially, and we exited March at roughly 14% branded share, officially surpassing Zydra on a monthly T-Rex basis and steadily gaining ground on MyVo. Crucially, all of this was achieved with a smaller sale force of fewer than 50 representatives. Now that we have doubled the V-Buy team, we are aggressively deploying these new reps into both uncovered and underserved territories, which will directly fuel further growth in NRX and TRX. This is happening in a market that has real underlying tailwinds. The dry eye category has grown 20% year-over-year in prescription volume in each of the last two years, and V-Buy was effectively the only branded product to grow in Q1. We are actively taking share in an expanding market, and that is the absolute cleanest signal you can get that the brand is winning on its own merit. Moving to IHESO, demand continues to build. Unit demand grew 18% year over year. New ordering accounts increased 21% in the quarter, and total accounts were up nearly 50% versus last year. Retina remains the core driver, representing over 80% of volume, and the momentum we saw in Q1 has continued in the early part of Q2. Interest in Iveso continues to build, with demand increasing and new accounts continuing to come on board. There is substantial runway ahead within the Retina market, and we are starting to see early and encouraging signs of adoption in the in-office setting. That expanding interest across settings reflects growing position, familiarity, and confidence in the product, and reinforces our view of the broader long-term opportunity for IHESO. Looking ahead, this growth story is driven by two engines, continued momentum in retina and expansion into the broader in-office market. What underpins both is a very strong refill dynamic. Once a practice adopts IHESO, they continue to reorder. We also have four distinct catalysts that will drive the next step change in growth. First, expanding into the full in-office market adds more than 2.5 million procedures to the addressable opportunity. This expansion is underway and off to a strong start. Second, the first available retina-specific clinical data begins reading out in July, followed by additional data in the fourth quarter, which is designed to accelerate adoption. Third, we are launching multi-unit packaging tailored for high-volume practices. And fourth, we expect a meaningful improvement in net pricing in the second half of the year. These four catalysts completely underpin our conviction in IHESO's accelerating trajectory from Q3 onward. On TriEssence, the headline number is 136% year-over-year unit volume, marked alone with up 113% year-over-year. This is now our sixth consecutive quarter of demand growth, and unit demand has grown roughly 250% over those six quarters. The composition of this growth matters. 44% of Q1 volume came from the ocular surgery account, and we expect that segment to drive the majority of new volume going forward. New account growth was approximately 28% sequentially. We are seeing increasing integration into the procedural workflows, particularly among cataract surgeons, driven by the product's ability to simplify postoperative care and improve the patient experience. That value proposition is directly translating into reordering. In addition, our label expansion study in cataract surgery and pain is underway, which is positioned to materially expand the long-term opportunity. This slide is a reminder of the sheer breadth of what sits behind our three lead products. We have one of, if not the largest portfolios of ophthalmic prescription medications in the U.S. market, stating specialty steroids, NSAIDs, and anti-inflammatories, antihistamines, antibiotics, plus the most comprehensive ophthalmic compounded portfolio in the U.S. market. Two highlights from Q1, we secured the Iopidine J-code, which I will cover in a moment, and we are unlocking the value of two additional historically underappreciated assets. Each of these assets is positioned to enter new on-label markets and contribute meaningful incremental revenue. Verkazia is the first and only labeled product for vernal keratoconjunctivitis, a devastating form of severe ocular allergies that affects children and adults. Our research clearly shows the degree to which the disease is underdiagnosed. We intend to share our plans regarding Verkazia opportunity in the near term. The second is Natacin, a product for fungal blepharitis and other sites threatening fungal infections. We are conducting a study for that product and will share more information later this year. Lastly, within our Access Plus cash pay business, our supply chain operations successfully cleared the back orders accumulated last year for certain compounded products, rebuilt inventory across the key stock-keeping units, and completely restored the operational confidence our customers expect. Let me close on iopedine 1%, the only FDA-approved therapy to prevent interocular pressure spikes, following various in-office procedures backed by strong, well-established clinical data supporting its use in this setting. Despite that clinical profile, iopedine has historically been underutilized for one specific reason. Physicians had no reimbursement pathway, and the product sat as a cost center with incapitated fees. That fundamentally changes on July 1st when the permanent J code takes effect at ASP plus 6%. Position incentives are now perfectly aligned with evidence-based practice. The addressable market for laser procedures alone exceeds 1.5 million annual use cases. There is no FDA-approved alternative with an established J-code. Critically, IOPADY runs through the exact same in-office call point as IHISO, meaning we are directly leveraging existing commercial relationships rather than building new ones. We expect this to be highly incremental, high-margin contributor as we move through the second half this year. To summarize the commercial picture, VVI is taking care in a growing market and now has the access and sales force density to dramatically accelerate. IHESO's demand continues to grow sequentially, armed with four independent growth catalysts landing in the second half, alongside continued strength in retina and a highly successful expansion into the in-office setting. Triessence has delivered six straight quarters of growth with a major label expansion in motion. Antiopidine hits a critical reimbursement inflection on July 1 that unlocks a market that has been waiting for it. Demand across the entire portfolio is rebut, and our commercial organization has never been better positioned to convert it. With that, I will now turn the call over to Amir to discuss the assets we recently acquired from Melt Pharmaceuticals.

Thanks, Pat. I wanted to spend a few minutes on G-Melt, our IV and opioid-free procedural sedation candidate. Having spent nearly 30 years in drug development advancing major global assets, I view G-MELT as a pipeline candidate of the highest caliber. It is uniquely positioned to disrupt standard procedural sedation and positively impact millions of patients. Regarding our clinical and regulatory progress, following the acquisition of MELT, the program's required deliverables included three pharmacokinetic studies and a non-clinical toxicology study. We have successfully initiated all of these programs. The non-clinical study is now in the reporting phase, and the first pharmacokinetic study has also been completed and is in the CSR drafting stage. The other two PK studies are the renal and hepatic impairment study, both of which are underway, and we anticipate final reports in Q4-2026. On the manufacturing front, our integration and scale-up activities are advancing rapidly. A major manufacturing campaign scheduled for later this quarter will formalize the data package required for our NDA submission. Based on our current trajectory, we remain firmly on track with our targeted timeline. By our next quarterly call, we expect to provide a definitive update regarding our pre-NDA meeting date with the FDA. With that, I would now like to turn it over to our operator for Q&A.

Thank you. To ask a question, please press star 1-1 on your telephone and wait for your name to be announced. And to withdraw your question, please press star 1-1 again. We do ask that you please limit to one question and one follow-up. And our first question will come from Tamar Abenekov with Cantor. Your line is open.

Hi. Thank you so much. This is Tamar Abenekov on for Steve Seathouse. So in terms of VY, could you talk about the gross to net adjustment in more detail and to what extent this was driven by typical seasonality and maybe what were the major buckets, you know, such as copay assistance, high deductible buy-downs, you know, cash to economics, and to what extent this gross net adjustment is isolated to Q1. Thank you so much.

Thank you, Tamar. First of all, the first quarter typically for Part D products with the deductibles resetting is always a challenging period for these types of products. As we noted, I think, in one of our documents, the dry eye category for the first quarter was actually down in total prescriptions. In fact, the branded market was down 18%. That's in the face of the overall category improving better than 20% for the last two years. But what we highlight and what I think is important is that our NRX growth, our new prescription growth was actually up 25% sequentially in the face of a branded market that was down 18%. Our TRX growth was up 11%, once again, in the face of a branded market that was down 18%. And with CVS specifically, the new benefit manager that we brought on, the new coverage on the commercial side, we were up 170% in sequential growth with that set of plans alone. So, we did very well. What I would say is, and I want Andrew to comment on this, is that, you know, we had to make a bet with our model in terms of what the likely volume would be for patients with high deductibles. And frankly, the surge in volume that we saw was so large that it really just exceeded the modeling that Andrew and his team had done. On the one hand, it's a bad thing to see this $8 million revenue reduction as a result of this. But on the other hand, we do know that we retain these commercial patients for a long time. And while we didn't do as well with these patients during the month of January and February and March, we're going to do very well with them on a go-forward basis. Andrew, do you want to specifically add to that regarding gross to net in the first quarter and any copay assistance?

Yeah. Kamara, thanks for question. Just to kind of add on to what Mark was saying, as we kind of looked at the average net pricing for these CVS patients in particular and our out-of-pocket pay-down for patients in general, the CVS patients were coming in about 40% higher out-of-pocket buy-down amount than than any other covered patient for us. And so obviously when we modeled things, we didn't model, we didn't expect that buy-down to be significantly higher for these patients. And so once we accumulated all the data and to make a decision based on the trends in mid-April, we adjusted those rules to basically take down the amount of out-of-pocket buy-down that we were putting into that patient pocket. We also made some tweaks that will affect patients on other plans as well, but should improve net pricing. I think it will have minimal impact on what that patient's actual out-of-pocket is. I think in some cases, actually, the patient's out-of-pocket will get better based on just some of these tweaks we did to the business rule. And so as we kind of talked through, the initial trend that we're seeing, importantly, is that there's minimal to no impact to demand, at least what we're seeing here these first few weeks of implementation of the new business rules. And importantly, we will now go from OCVF patients essentially being, on average, negative revenue to much more positive and contributing to overall net revenue on a go-forward basis.

Thank you. And the next question is going to come from Chase Knickerbocker with Craig Hallam. Your line's open.

Good morning, guys. Thanks for taking the question. Maybe just to kind of ask it directly on VBuy around ASPs, you had mentioned kind of an $8 million, you know, impact if the business rules had been changed, you know, for the entirety of the first quarter. So as we look kind of in Q2 and onward, I mean, that's about a, you know, call it mid-30s percent kind of impact. Is that what we should be assuming sort of from a potential increase of ASP or maybe, you know, just making sure that I'm kind of thinking about that the right way?

Andrew, I don't know that we can give a specific answer regarding ASP, but I know that you've done some calculations on what the likely improvement is, and it's impressive. Do you want to try and tackle that one?

Yeah, and Chase, obviously that's assuming status quo. but I think that's a reasonable assumption to assume roughly a 30% increase.

Helpful. And maybe just you guys have a couple weeks of additional visibility relative to us, obviously, on kind of the V-by data. You know, so far since those business rule changes, could you maybe just give us some commentary as far as what you've seen in recent weeks as it relates to the volume just kind of confirming the, you know, this isn't having an impact. And maybe around that, Andrew, if you could kind of explain in a little bit greater detail how, you know, the out-of-pockets could actually kind of be coming down for these patients with these business changes, you know, respecting the fact that, you know, there's a lot of detail here. Thank you.

Thanks for that, Chase. Yeah, in terms of VVI volumes, more recently in the last, let's say, 20 days even, And I think I mentioned this in my stockholder letter, but I watch the new prescription volumes like a hawk. I mean, literally multiple times a day, we have a dashboard that gives us real-time data as to what's coming in. And I know, for example, you know, at 4 o'clock central what the likely total day volume will be because we've got a lot of data in our system in terms of, you know, what the balance of the day would look like as the mountain time and Pacific physicians begin to write for Viva. But I think what I'm really pleased with, and I mentioned this in my opening remarks, is that I am seeing higher highs and higher lows in the last 15 days especially. And I think that's as a result of these new reps actually being out in the field, making the calls, and their work beginning to bear fruit. That's really exciting. In particular, I'm seeing days in the week that are usually lower in volume than other days in the week, and now all of a sudden they're popping up, breaking trend lines and becoming much better days in the week. So we're having record days, record weeks, and as I said, higher highs and higher lows. That's really positive, and we can see those trend lines breaking. So the work that we are doing out in the field with this doubling of the sales force is beginning to have an impact. Andrew, do you want to talk about patient out-of-pocket?

Yeah. And, James, I'm going to try to speak to this without getting too much detail because a lot of our competitors listen to this call as well. What I would say is we are going to leverage our VAFA program and cash pay program with some of those patients as well, which, as you know, the cash pay price there is $59 for the product.

Helpful, guys. Thank you.

Thank you. And the next question comes from Lachlan Hanbury-Brown with William Blair. Your line's open.

Hey, guys. Thanks for the question. I guess maybe I'll ask one on IHEDO. Just how should we think about the dynamics in Q2? Is channel inventory sort of largely normalized at this point? And then how do we think about the sort of sunsetting of the current packaging versus the introduction of the new packaging and how that may impact T2?

Yeah, I'll make a few comments, Lachlan, and then turn it over to Andrew. But I think a couple of important data points. One is 2025, we saw 30% of our unit volume come from the ASC setting. I think you know that. But the ASC setting in the Q1 period was down to 18%. And I think, as I said in the stockholder letter, we should be able to eclipse the entirety of that ASC volume through the in-office sales that we're beginning to see flow by the end of the year. So that's very promising. Obviously, we've now moved to a five-pack presentation. You know, we've made some, you know, I think very significant improvements to ASP that will begin to kick in in the third quarter. And I think we even referenced the figure of, you know, better than 20% improvement. So that's really, I think, important. And I think what our sales force is particularly excited about is finally having some retina-specific data to be able to present to accounts. So everything that we've done, you know, we've got a few percentage points of market share, but not many. The vast, vast majority of the market opportunity remains underpenetrated, unpenetrated, and we believe that this data is going to certainly help us. And that's showing up, by the way, in Q2. We're seeing record new account starts, and that I think bodes well for not only the second quarter, but the third quarter and beyond. That's what I think gives us so much confidence in our reiteration of our guidance. Andrew, do you want to talk about the stocking dynamic and what to expect in Q2 versus Q3?

Yeah, absolutely. So second quarter revenue for IHESO, we're expecting to still be somewhat muted, especially compared to second quarter last year. We're still working through that remainder of channel inventory that was taken in Q4 and the loss of pass through. But to Mark and Pat's points, you know, we're seeing a big increase in demand, especially on the retina side, a lot of new accounts coming through. So a lot of the – any revenue that we're going to be booking will be below last year, but we should start seeing revenue start increasing from IHESO and then get to more of a normalized level beginning in Q3 and Q4, especially as we introduce this new multi-pack option which we will commercially launch in July of this year once that with the new J code so how should we think about that adoption of the market opportunity obviously a lot of procedures out there where it could be used but just as we think about you

and how it changes in terms of the contribution it makes starting in Q3 is that going to be a meaningful driver of the backup or is it more incremental especially in light of, you know, some of the changes with Viva in the heat of Triasus?

Yeah, I would definitely say it's going to be an incremental contributor on the launch, you know, in the third quarter and the fourth quarter of this year. We're more bullish on the contribution, you know, in terms of it showing up relative to our overall size in 2027. But we're really pleased to have the J-Code. It is a sizable market, and frankly, the laser procedure market, which is what we kind of quote in terms of the overall TAM at better than 1.5 million annual procedures, is really only a fraction of the potential use cases of the product. There are a lot of procedures that occur in the office that can induce a pressure spike. And right now, these offices are using a variety of off-label products, once again, that are paid for out of a capitated fee. And I think that the opportunity to use something that is on-label, that is reimbursable at ASP Plus, is very attractive. And we've done a meaningful amount of market research to validate that. So we're pleased to get that launched. It'll be incremental this year. it'll show up, I think, you know, with bigger numbers in 2027.

And our next question is going to come from Tom Schrader with BTIG. Your line is open.

Good morning. Thanks for taking the questions. Kind of one more on V-Buy. Can you give us a remedial rundown of the information flow, why you learned so late, why it took four months for you to get a hint that this problem was going on? I feel like you warned on everything this quarter, but then this one hit, and is that solved? And then one quick one on Ahizo. It's interesting to see you still have 18% AFC use. Do you think that's stable? Do you think that's people who like it enough that are eating the cost, or is that 18% going to continue to decline? Thank you.

Well, thank you for that, Tom. I'm going to take the last question first, and then I'll ask Andrew to talk about timing, because I think it's really important. Our stockholders, I think, hopefully will appreciate, after Andrew explains this, why this is not a real-time situation. You can't just make a decision, change business rules on a real-time basis, and that we actually acted expeditiously once we figured this out. Andrew will talk on that. But in terms of IHESO and the ASC, the IHESO business in the ASC is going to go and probably is now at zero. So these ASCs are not going to be purchasing IHESO for procedures in that environment. What we can say is that the unit volumes that we formerly had, and I'm not talking about the 18% that we had in the first quarter, but I'm talking about a more normalized view of what we had in the year 2025 in the ASC environment when those units represented 30% of the overall volume. Those are the unit volumes that we expect to replace with in-office use cases by the end of the year. So it's a larger number overall, and it will contribute meaningfully, I think, to our revenue in 2026 and certainly in 2027. But, yeah, the ASC business is going to go to zero. The good news for us is that we have durable, sustainable reimbursement in the in-office market. And I would say we have nearly pervasive coverage, nearly pervasive coverage, better than 95% coverage and a prior authorization rate that is sub-5%, so extraordinary coverage in office, and that is durable. Andrew, do you want to describe, you know, I think in more detail the timing of the work that you and your team did on the business rules?

Yeah, absolutely, Tom. I appreciate the question. So, first of all, it's more than just one data set that we use to assess and calculate a lot of these figures, and so it's copay data, it's the claims data from the payer, it's script data from our partners and IQVIA that we're using. And so as we're getting that data, you know, we're making assumptions, but January, which came in, you know, middle of February, when you have all of the data and you can calculate and analyze it, that came in pretty much in line with what we were anticipating. And so middle of February, we thought we were in pretty good shape. When the February data came in, that's when sort of our, I would say, our antennas went up because numbers were coming in much higher than we thought or anticipated, but we didn't want to make a decision based on that single data point, that single data point being the month of February, so we wanted to see how March came in, and unfortunately when March came in, which the final accumulation of data came in mid to late April, you know, we knew we had to make it we knew we had to make changes and so I think we had a final final data set that we were able to act on on a Friday and we worked over the weekend and had the new business rules out to the partners Sunday night and so we made we try to make decisions based on trends and not data points and that's what we did in this case we worked as quickly as possible to get those changes in place. And I think going forward, we should see much better improvement on pricing for the product, especially in the case of some of these covered scripts that we've been talking about.

Perfect. That's useful detail. Thank you.

Thank you. And our next question will come from Mayank Mantani with B-Riley Securities. Your line's open.

Yes. Good morning, team. Thanks for your questions um regarding the 100 reps hired in a relatively short period of time mark could you touch on what sort of experience they bring in and how you anticipate demand uh to inflect further as a result of that in the second half and and i i don't know if i heard um a commercial mix uh you know of the total uh nrx that you're seeing if you could maybe give a little bit more color on also how you know these reps can have an impact on improving commercial mix and I think in prepared remarks Matthew said there are some positive insurance reimbursement developments for DUI if you could maybe lay that out in this 12 to 18 month period.

Pat do you want to talk about the tenure of some of these new reps? Thanks Mark.

That's your question. You know as we talked about this is all about demand and the indicators that we're seeing are very positive and and you know as Mark mentioned in the letter and and previously on the call you know we were able to deliver into one the growth with a generally small team of 50 representatives what we're most excited about in our expansion is the recruitment approach that we use we have you know many many reps we recruited have ophthalmic experience in their exact areas I think we have a range of experience on the anterior side that I think is going to position as well for many of the other competitors in our face right now as we sit today. So we're super excited about that team that's been out there arguably a few weeks as it sits right now. And as Mark mentioned, our early indicators in Q2 are showing positive signs and we are just getting started. So I would expect ongoing growth acceleration because of the profile we have. Our representatives are out there. I think, you know, as Mark mentioned in Q1, we wanted to get them out as soon as possible. But I can tell you that we took a very diligent approach to make sure that we, We've recruited the right reps, at the same time put them through a very rigorous approach to make sure that they were stepping into the field to make impact immediately, to grow Levi, and the signs are very positive for us at this point in time. And like I said, I mean, we're super encouraged on the prospect for growth going forward, and the team, as we said, has been out there for only a few weeks. So I think more to follow here in Q2 about the progress they make with their customers.

But early signs, expect more growth. and and mike in terms of you know how do you improve the commercial mix you know one of the things i like most about pat is he really believes in incentives very strongly and he buys into this this whole concept of you know what you incentivize you end up getting and so you know we value a commercial covered prescription in our company certainly more than we do for example, a cash pay consignment prescription in terms of the economic value. And so, Pat is a big supporter of that. In terms of new insurance reimbursement, new coverage, the team is actively bidding on that coverage, and those processes are in place. And, you know, we have some idea that, you know, we should see improved coverage over the next 12 to 18 months. I think that's why we made the statement. We can't get more specific with which benefit managers or which payers. But we do believe that we're going to have some decent coverage wins over the next 12 to 18 months, and we'll see. And to the extent that they're meaningful, we'll certainly, you know, make our stockholders aware of those.

Great. Thank you, Pat and Mark. And then on the Ahizo growth catalyst for the second half, I appreciate the color on, you know, which ones are demand versus net pricing improvement related but I was just trying to understand the full year revenue target for that brand because you know the second half revenue uplift you know needed to get to the full year target if you just look outside of you know VY and compounding business there's a lot of growth including for my hero and other products if you could maybe just help us understand you know how do you get to the second half number uh you know throughout the different parts of it will pull you down and be very helpful.

Well, I'll ask Andrew to kind of give some additional cover on that. But what I can tell you is that even in the second quarter number for IHISO in particular, you know, you're not going to see the same level of revenue, we believe, for the second quarter as you did, for example, in the first quarter. So we do expect to see a meaningful step up in terms of revenue from IHISO, even in the second quarter, and the big improvement to not only unit demand, the big conversion of unit demand to revenue is going to happen in the third and fourth quarter for that product. Andrew, do you want to comment on second half revenue and the guide?

Yeah, I will. So I think in the second half, number one, you also get a new product, which is BioViz coming to market, which we expect to have, let's say, a meaningful contribution to revenue. IDZO, we expect from a revenue perspective to be close to last year's number, hopefully in excess of it from a revenue standpoint, depending on demand. V-Buy revenue will continue to ramp quarter over quarter, we expect. We've hopefully seen a meaningful improvement in Q2 over Q1. And then in the second half of the year, we expect to really see the benefit of that Salesforce expansion, accelerating unit volumes, and importantly, net pricing being stabilized on the product. And then, as Pat kind of mentioned, we should also start seeing contributions from some of these other products that are going to get some attention this year, Verkazia, Natasin, and then as well as Iopening with the J code being issued. And then we've got Impermis on the compounding side and the XS Plus side. That business has been sort of out of that inventory issue that had been occurring in Q4 and Q1 of this year, and that business should return to a growth trajectory this year, although more sequentially quarter-over-quarter versus year-over-year.

Thank you. Thank you. And the next question comes from Thomas Flatton with Lake Street Capital Markets. Your line is open.

Hey, good morning, guys. I appreciate you taking the questions. Just to confirm on the salesforce expansion, in your letter you talked about hiring about 100 folks. If I'm understanding, 50 of them went to the V-Vice sales team to effectively double that team. And the distribution of the balance of those new hires, was it all for the retina team, or is there something else we should understand about that?

No, and thank you for that question, and I'm glad that I had the chance to clarify. So we did hire about 50 new reps for the dry eye team. We also tripled the sales force for TriEssence. So, you know, that sales organization is now three times the size that it once was. We've also made a few incremental hires in Retina. And as I said, I think in my prepared remarks, we've also begun to – we decided to bolster some of the Access Plus teams. So, and then finally, Vercasia and Madison in particular, historically, have not had any inventory. They've had inventory problems, you know, with that product. And I'm talking about, you know, pre-Hero ownership. It had not really had any, you know, dedicated sales and promotion. and, frankly, with both Vercasia and Madison, once again, any marketing that was done was really done on only part of the label. So we're going to make a big push with those products. We're going to talk a little bit more about Vercasia in the coming weeks. I'm particularly very excited about Vercasia. We have great pricing on that product. It's a very powerful product in terms of its clinical efficacy and the results that it provides, particularly for children. It's the only cyclosporine that's actually on label for pediatrics. And, you know, we're going to make a big push in that category. And so we did build out what we call a specialty team around both of those products. And that team makes up the balance of that 100.

That's super helpful. Thanks for that. And then, Mark, previously I think you've mentioned, I want to say you used the word bounty for pulling the G-Melt submission into 2026. I heard early 2027 today. I'm just curious if there was a chance that that could get pulled forward, if we should really think about an early 2027 NDA submission for G-Melt.

Right now, I think, you know, let's think about a Q1 2027 submission. We're working really hard, I know the team is, to complete the balance of the data gathering and to build the dossier for submission. So I think by our next conference call, we'll have a lot more information, and I'll be able to, you know, I think specify as to, you know, whether or not we'll be able to get a submission made at the end of the year. If we did, it would be at the very, very end of the year. But I have to tell you, whether we make the submission in late December or early January or even early February, the potential that we see for that product is just extraordinary, absolutely extraordinary. and I do believe in due course that that product will be perhaps our largest selling product by revenue. So we're really excited to get that NDA filed. All the really difficult risky work is behind us. The work that Amir discussed is, I don't want to say perfunctory, but it is you know, ultra-low-risk data gathering, and we're excited to meet with the FDA in a pre-NDA meeting. We'll have more information about that in August when we have our next call.

Thank you very much.

Thank you. And the next question will come from Yuchen with H.C. Wayne, right? Your line is open.

Thank you for taking my questions. Could you comment on whether Biclovy has already been launched and whether your current four-year revenue guidance includes sales of Biclovy and this?

Thank you. The Biclovy launch, strictly speaking, when we say launch, we mean trade launch. We mean actual sales of the product. Believe it or not, from a sampling perspective, ByClovy has actually launched. We've begun to distribute ByClovy samples to select customers. I think there's several thousand of those samples out. We're going to spend the next couple of months continuing that process of sampling and talking to customers about ByClovy, which we think is a best-in-class topical steroid. The topical steroid category is a very large category. And we're going to begin the trade portion of the launch, you know, actually selling the product, driving revenue. That will begin in the third quarter. But strictly speaking, you know, if you were to go into the offices of some of these doctors that are a part of this program, they will have access to Biclovy right now. So, samples are out, trade's going to begin in the third quarter of this year. And in terms of the numbers that we're quoting, they are inclusive of Biclovy for sure.

Can you also comment on how much contribution do you expect for these two drugs to make in 20, beyond 2026?

Yes, so we're not giving revenue-specific guidance on each product. Especially, you know, in a new launch, I think that would, you know, we would have a tough time doing that externally. We certainly have internally, you know, a model built, but we're not prepared with either Biclovy or even BioViz at this point to provide, you know, what the expected revenue contribution will be for this year or next year. Thank you.

Thank you, Yee.

I show no further questions at this time. I would now like to turn the call back over to Mark for closing remarks.

Thank you, Operator, and thank you all for joining us today. Let me close with what matters most, and that is Harrow's demand strength is stable. It's a foundation that supports my confidence in our future. With the high deductible season now behind us, we're moving into a period of accelerating growth and execution. The first quarter included a discrete issue that we have resolved, and that does not impact the long-term trajectory of this business. We spent the past several years building this platform, expanding access, scaling our commercial organization, and positioning our portfolio for growth. That work is largely behind us. we're now entering a period where the foundation translates into sustained revenue growth and increasing profitability. Looking ahead, we have clear visibility into the drivers of our performance from improving access and pricing to new product contributions and clinical milestones. Beyond that, we're actively shaping our next five-year strategic plan with a clear path to scale our core assets, unlock additional value across the portfolio, and hopefully complete some accretive and exciting acquisitions. When I step back, this is stronger, more scalable, and in my view, a more valuable company than at any point in our history. And we truly appreciate your continued trust and support. Thank you, and this will conclude our call.

This concludes today's conference call. Thank you for participating and you may now disconnect.