Thank you for standing by. Welcome to the Connect South Pharmaceuticals fourth quarter and full year 2025 earnings conference call. At this time, all participants are in listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you'll need to press star 11 on your telephone. If your question has been answered and you'd like to remove yourself from the queue, simply press star 11 again. As a reminder, today's program is being recorded. And now I'd like to introduce your host for today's program, Jonathan Kirshenbaum, Investor Relations. Please go ahead, sir.

Thank you, Operator. Good morning, everyone, and thank you for joining Knicks' call to discuss our fourth quarter and full year 2025 financial results and recent portfolio execution. A press release highlighting these results can be found on our website under the Investors section. As for the agenda, our Chief Executive Officer, Sanj K. Patel, will start with an introduction. From there, Ross Mote, our Chief Operating Officer, will discuss our IL-1 Inhibition franchise and provide an update on ARCLIS commercial execution. Then, Kinect's Chief Financial Officer, Mark Ragosa, will review our fourth quarter and full year 2025 financial results. And finally, Sanj will share closing remarks and kick off the Q&A session, for which Dr. John Paolini, our Chief Medical Officer, and Evan Tasari, our Chief Strategy Officer, will also be on the list. Before getting started, please note that we will be making forward-looking statements today that are subject to risks and uncertainties that may cause actual results to differ materially from these statements. A review of such statements and risk factors can be found on this slide, as well as under of the caption risk factors contained in our SEC files. These statements speak only as the date of this presentation and we undertake no obligation to update such statements except as required by law. With that, I'll turn it over to Sanj.

Thanks, Jonathan. Good morning or good afternoon, everyone. I look forward today to reviewing Connix's fourth quarter performance and key highlights across our portfolio over the past year. Diligent execution across our commercial and clinical organization throughout 2025 has put us in a strong position to further advance our business. Arculus revenue continues to grow, driven by the expanding adoption of IR1 alpha and beta inhibition across the recurrent pericarditis population. Since the launch in 2021, we have delivered this transformative therapy to thousands of patients, enabling a fundamental shift in the treatment paradigm and driving sustained revenue growth. On a year-over-year basis, ArcList product revenue grew 65% to $202.1 million in the the fourth quarter, and 62% to $677.6 billion for the full year 2025. Importantly, ArcList revenue growth has been profitable since the fourth quarter of 2021. This has allowed us to make strategic investments across sales and marketing with the aim of capturing additional long-term growth. Ross will cover this in a moment. Kinexa's robust financial position gives us the ability to create additional value by investing in R&D and advancing internally discovered and developed assets such as KPL 387 and KPL 1161, as well as pursuing strategic business development. Focusing on clinical, this time last year, we announced our development program for KPL KPL387 in recurrent pericarditis, with plans to initiate a Phase II, Phase III clinical trial in the middle of last year. That was achieved, and we are continuing to enroll and dose patients in the Phase II portion of that program. And we are on track for data in the second half of this year. Together with continuing ARKELIS growth, the development of KPL387 positions Konexa to extend its leadership of the recurrent pericarditis market. In particular, we believe KPL387 could address key patient needs and expand penetration into the addressable market by potentially enabling monthly dosing with an auto-injector. In addition to KPL387, we also recently announced that we plan to be in the clinic with KPL1161, which is our FC-modified R1 Alpha and beta inhibitor by the end of this year. As highlighted, we made important progress across our commercial and clinical portfolio in 2025, and we are working diligently, some would say like the clappers, to continue that strong trajectory in the year ahead. And with that, I'll turn it over to Ross for review our commercial execution.

Thank you, Sanch. As we shared earlier this year, Canixer's robust execution over the first five years of our commercialization has established the recurrent pericarditis market and put ArcList on a path to future blockbuster status. Our full year 2025 net revenue was $677.6 million, which is an increase of more than $260 million compared to 2024, and represents the highest year-on-year growth to date. The primary driver of this growth has been the expanding adoption of interleukin-1 alpha and beta inhibition with Archelisk as a second-line treatment immediately after the failure of NSAIDs and Colchizine. In 2026, we expect to continue expanding the utilisation of ArcList in recurrent pericarditis and reiterate our previously announced full-year net revenue guidance of between $900 and $920 million. Historically, Q1 faces some seasonal headwinds in the specialty drug sector associated with payer plan changes and co-pay resets and as a reminder in q1 of last year we benefited from a one-time bolus of patients who transitioned to commercial therapy associated with ira medicare part b changes as you've heard from sanj our arc list franchise is profitable which over time has allowed us to invest in our commercial infrastructure and digital marketing efforts to maximize our opportunity in recurrent pericarditis by reaching additional healthcare professionals and patients. In 2026, our focus is to unlock the next phase of growth for ArcList by driving further physician awareness of the 2025 ACC concise clinical guidance, advancing our digital marketing initiatives to empower patients to discuss ARCHLIS with their physician, as well as utilizing AI and machine learning to efficiently and effectively target the right physicians at the right point in time, and to explore ways to expand the impact of pericardial disease centers where the growth in ARCHLIS prescriptions has outpaced growth at other sites. At the end of 2025, more than 4,150 prescribers had written a prescription for ARCLIS. Of those, around 29% or more than 1,200 prescribers have written ARCLIS for two or more recurrent pericarditis patients. This continued growth in both total and repeat prescribers illustrates how we are evolving the treatment paradigm in recurrent pericarditis by updating the approach for treating the disease with targeted interleukin-1 pathway inhibition. Additionally, we've built a strong foundation to our commercialization, with the average total duration of therapy approaching three years, robust payer approval rates, and strong patient adherence, all of which has created solid commercial fundamentals. With increasing penetration into the multiple recurrence target market and additional upside with Archelis being used earlier in the disease course, we continue to see meaningful opportunity ahead. The combination of an effective commercial engine with robust safety and efficacy data for Arcanist means we are well positioned to continue expanding our reach into both the multiple recurrence and first recurrence populations. On the left-hand side of this slide, you can see that our penetration into the two-plus recurrence target market has increased over time, most recently up to approximately 18 15% at the end of 2025, compared to around 15% in the middle of last year, and 13% at the end of 2024. As we've previously stated, approximately 20% of Arculus prescriptions have been written for patients following their first recurrence, demonstrated increased use earlier in the disease course. Overall, we are seeing physicians more readily turn to targeted interleukin-1 alpha and beta inhibition with ArcList after the failure of NSAIDs and Coltizine. In 2025, this evolution in treatment paradigm was ratified by the publication of the ACC Concise Clinical Guidance, which now recommends interleukin-1 pathway inhibition as a second-line approach immediately following the failure of NSAIDs and colchizine in patients suffering from recurrent pericarditis. As you've heard, we're pleased with our solid execution and progress. But far more importantly, we're excited about the opportunity ahead to support significantly more recurrent pericarditis patients with ARC-LIST. And with that, I'll turn the call over to Mark to review our financial results.

Thanks, Ross. In 2025, we advanced both our commercial business and our clinical portfolio while maintaining a strong balance sheet, positioning us to continue to help patients and grow in 2026 and beyond. This morning, I will walk through our fourth quarter and full year 2025 financial results. You can find our detailed financial information in today's press release. There are a few items of note. First, starting on the left-hand side of this slide with our income statement, as Sanj and Ross noted, broader adoption of IL-1 Alpha and IL-1 Beta inhibition as a second-line treatment drove strong ARKLIS product revenue growth in 2025. ARKLIS product revenue grew 65% year-over-year to $202.1 million in the fourth quarter and 62% to $677.6 million for the full year of 2025. Second, operating expenses grew year-over-year in both the fourth quarter and the full year of 2025, driven by higher costs of goods sold due to ARKLIS growth, increased collaboration expenses aligned with higher ARKLIS collaboration profit, and additional SG&A expense with investment to further support ARKLIS commercialization. Third, net income was $14.2 million in the fourth quarter of 2025, compared to a net loss of $8.9 million in the fourth quarter of 2024. And net income was $59 million for the full year 2025, compared to a net loss of $43.2 million for the full year 2024. Fourth, the right-hand side of the slide provides a calculation for ARCLIS collaboration profit, which largely drives total collaboration expenses. On a year-over-year basis, ARKLA's collaboration profit grew faster than sales, up 83% to $140 million in the fourth quarter, and up 96% to $459 million for the full year 2025. Lastly, regarding our balance sheet at the bottom of the slide, We ended 2025 with $414.1 million in cash, representing $170.4 million of net cash generation for the year. And we expect to remain cash flow positive on an annual basis under our current operating With that, I'll turn the call back to Sanj for closing remarks.

Thanks, Mark. As you've heard, Conexia continues to execute both commercially and clinically, and is well position to build significant future value as we grow our IL1 alpha and beta inhibition franchise. We've got a brilliant team that is dedicated to helping as many patients as possible with ARTLIST and to advance in the development of our clinical portfolio in order to bring additional therapies to patients suffering from debilitating diseases. With that, I would turn it back to the operator for questions. certainly.

And our first question for today comes from the line of Nick Larissa from TD Cowan. Your question, please.

Hey, guys. Good morning. Thanks very much for taking my question. So, you guys have reported continuing increased penetration in the multiple recurrence setting. So, I'm kind of wondering, what do you think the peak penetration is for ARCLIST in this setting, and how could that evolve with the potential approval of KPL 387?

Thanks.

Thanks, Nick. Maybe I'll start. I'm happy to pass it over to the team or Ross next to the comments. So, at this point, we have not commented on the peak penetration. Suffice to say that, as I think Ross mentioned, we do believe there's still an awful lot of growth that we can capture with Arculus. Obviously, a lot of the work that we're doing both through our sales force, through marketing, digital efforts, and making a lot of inroads there. So, you know, we continue to crack on penetrating into that market. You know, how far it will go, time will tell, but it really is an access of how much work we put into it and how smart we work.

Ross, any comments? No, I think that's great. I mean, maybe just to add, we feel like we're relatively natin in the opportunity. We've got a huge opportunity left ahead. We announced we're around 18% penetrated into the target population of patients with two or more recurrences, that's a 14,000 population at the end of 2025. And that's without taking into account those patients that are earlier on in the disease, on their first recurrence, which is a much larger group of patients, around 26,000 patients in any given year. So the opportunity is there for us to do much more, albeit that we're happy with where we are at this stage, but we're very excited about the future.

Thanks very much. Appreciate it.

Thank you, and our next question comes to the line of Eva Forte from Wells Fargo. Your question please.

Good morning, thanks for taking our questions and congrats on the quarter. A quick one from us, you've mentioned several times now that 20% of ARCALYST patients are in first recurrence versus 80% in two plus, and I guess my question is, is the pace of growth in these two different patient populations the same in terms of like ARCALYST and does Does your market research suggest potential changes to the 20-80 ratio?

Thanks, Eva. This is Ross, so I'll start to answer that. And, John, if you've got anything to add, please feel free to do so. But you're right in stating that, you know, the percentage of patients that we have in the first recurrence has grown over time. There's around 20% of all office prescriptions that seem to be in the first recurrence group at this stage. So we view that as a positive change as we've evolved the treatment paradigm. And as physicians get more and more comfortable both with prescribing ARCHLIS but also seeing the effect of having their patients on ARCHLIS and what that does for them over the long term for dealing with this kind of multi-year chronic disease in most patients, that creates familiarity and confidence to go and prescribe earlier on in the disease and help more patients. So we think that's great. How that will evolve over time is to be seen. But we think it's kind of a positive stage for where we are right now. When we think about those patients in the first recurrence group, there are certainly patients that are, you know, more high risk for longer duration of disease and for suffering future recurrences, particularly those patients that, you know, have other risk factors or they're suffering from, you know, significant effusion or even cardiac tamponade or constriction. and that those patients, you know, could be helped within label for Arculus, which obviously covers recurrent pericarditis overall and is not, you know, is agnostic to the number of flares a patient has suffered. So, the opportunity to help those patients as well and then to avoid them going on and suffering future detrimental effects of this disease is very much there for the healthcare professionals to decide to prescribe within that population. So, you know, we're happy that more and more people so far seem to be doing that.

Got it. Thanks.

And our next question comes to the line of Jeff Meacham from Citi. Your question, please.

Great. Morning, guys. Congrats on the quarter, and thanks for taking the question. Just have a couple. The first on the pipeline, so 387 or even 1161, what's the extent of FDA interactions of late? It does seem that the agency is maybe more open for novelty on design or maybe adding analytics just to speed up the development and maybe down the road the review process. Just curious your thoughts on that and maybe how you could take advantage of that. And the second one, another one on first recurrence versus second or later, are there differences in persistent rates between those two populations? I wasn't sure how any commercial metrics tees out between those two populations.

Yeah. Good to hear your voice, Jeff. Thank you for the question. Maybe I'll take a quick start and then, John, pass over to you for the remainder of the interactions with the FDA, then we'll see you on the recurrences. So as always, we, you know, approach our development plans with absolute rigor no matter what we see in the agency. I think there have been some changes, but, you know, I think in the history of Conexia and even before, we've always took great pride in having a lot of thought, diligence, quality, and putting really robust development packages together. That changes no matter what, but you're obviously right, we are quite excited about the new development of 387 and 1161, I believe there's a lot of potential there, but I think no matter what John's about to say in terms of interaction with the FDA, we treated the same, and we We put together very robust development packages with the well-thought outcomes.

Good, John. John, thank you, Sam. And thanks, Jeff, for your question. Yes, so we very much value our interactions with the FDA on this element are very productive. As I think we mentioned when we announced the program that we had had with regard to KPL 387, that we had had interactions with the FDA that laid out the development program. It's important to note that we have already kind of laid out the entirety of the Integrated Development Program, which includes, you know, not only the Phase II work that is ongoing, but also the subsequent Phase III trial that is planned, as well as the long-term extensions. So that totality of the package, you know, has certainly been assembled, and the communications that we've had, you know, have affirmed, if you will, our belief that the Phase II trial would be sufficient and pivotal for registration in the U.S. With that said, we are always looking for opportunities to move the program faster in order to develop what we believe will be, you know, potentially transformational and additional therapy for patients and an additional treatment option. So, we'll, of course, be looking for ways to do that. With regard to 1161, of course, this program is still in its pre-clinical development activities, and so we'll have more to say about that as we progress. So thanks for the question.

Thanks, John. And Jeff, thank you for the questions. This is Ross. So to the part of your question around any difference in persistence rates between the two populations, we haven't seen anything meaningfully different between those two populations, whether it's those patients that have, you know, been suffering for two or more recurrences or on their first recurrence, but with additional risk factors signaling, you know, potentially longer disease duration, which is, I guess, as expected that, you know, we know that these groups of patients generally suffer from chronic multi-year disease, so we haven't seen any meaningful difference between those groups. And I think, moreover, what we're seeing is that healthcare professionals have moved their mindsets in how to treat this disease, not only with the utilization of interleukin 1 alpha and beta inhibition opposed to reaching for steroids or other ways of trying to manage this disease, but also in their mindset shift around that this is actually, you know, a chronic multi-year disease in most patients. And rather than treating for the short term, as used to be the case, particularly with the toxicity and the effects of trying to get patients off corticosteroids, treating throughout the duration of the disease with interleukin 1 alpha and beta inhibition is really the goal for for the management of these patients so hopefully that answers that part of your question as well thanks Jeff yep thanks guys thank you and as a reminder ladies and gentlemen if you do have a question at this time please press star one one on your telephone our next question comes from the line of Anupama from JP Morgan your question please hey guys this is Joyce on for Anupam thanks for taking your question maybe

Maybe just a follow-up on the previous question for KPL 387, once you've completed the dose focusing phase two portion, how are you thinking about enrollment curve for the phase three? And then are you seeing any differences in the types of patients you're enrolling relative to Rhapsody now that ArcList is on the market? Thank you.

Yeah, no, thank you for those questions, they were quite excellent. So, with regard to the, you know, the latter portion of your question about the types of patients, you know, what we've described, you know, in the study is, you know, bringing in patients with recurrent pericarditis. It's important for you to realize that this is a global study as well. So, it's enrolling patients not only in the United States, but also globally. And at this point in time, you know, ARPA is available, you know, in recurrent pericarditis, you know, only in the United States. And so, you know, it's a very robust study in terms of the types of populations that it's enrolling. And so, you know, the design is very straightforward in that regard. With regard to the transition to the Phase III study, so at this point, what we've guided to is that we would have data from the Phase II portion of the trial in the second half of 2026, and we've commented that we anticipate, you know, bringing this drug to patients in the 2028-2029 time frame. So, we have yet to provide guidance on the initiation of the Phase III study. And so, you know, in that sense, that will, you know, clinicaltrials.gov is certainly a, you know, very reliable place to look for updates as well as any updates that, you know, we provide ourselves.

Great.

Thank you. And our next question comes from the line of Roger Zong from Jefferies. Your question, please.

Great. Congrats for the quarter, and then thanks for taking the question. Also, question related to the 387. Just given the current Phase 2-3 and this Phase 2 transition from the third standard therapy, those study design and plan the studies, will this label and then the potential reimbursement test will be similar to the ACLIS when 387 launch? And then ultimately, when it's available, basically let the physician and patient choose between 387 versus ACLIS. Is that the base case here?

Well, thanks, Roger, for the question. Maybe I'll deal with the regulatory question and then hand it over to Ross in terms of market penetration. So, yes. So, with regard to the regulatory program, so if you remember, you know, the ARCELIS program, you know, which was an SBOA at the time, you know, this Rhapsody supported a label that was agnostic to, you know, a number of recurrences in prior therapy. So, it simply states for the treatment of recurrent pericarditis and reduction in risk of recurrent. And so, you know, that is a very solid label, which gave us the foundations to grow, you know, to grow and evolve the treatment paradigm. So, the KTL387 program, as you know, is designed in a very similar way in that, except with the difference that it is a full BLA package, meaning that this is the first, this would be the first leg of education for KPO387, and so in that sense, it carries with it a slightly larger, you know, based program in terms of some of the initial phase one and phase two work that's being done, as well as the larger long-term extensions to provide the safety package. But importantly, the core of the study is the phase three pivotal study, which as you can see on clinicaltrials.gov, bears a remarkable resemblance to the Rhapsody study design. And, of course, we always bring forward new innovations. But the goal of the program is to support, you know, a similar type of indication statement, if you will, in terms of the population of being able to treat all patients with recurrent pericarditis, regardless of prior line of therapy and number of recurrences, as long as they have that, you know, meet that diagnosis of having recurrent pericarditis. So, that's the regulatory framework. But I'll now turn it over to Ross to talk about the pericarditis part.

Yeah, thanks, John. And Roger, thank you for the question. So, maybe it's best to start off by saying we believe that ARPIS has a substantial future left to help many, many more patients suffering from recurrent pericarditis. But also, as we progress with KPL387, this program is aimed to address key patient needs and to expand the market for interleukin-1-alpha and beta inhibition with a target product profile of being less frequent dose and streamlined preparation and in a patient-friendly administration format, there being the potential to go into an auto-ejector. So we believe that all those things could be important future treatment option choices for patients. And based on the market research that we have at this stage and what we've shared is that when you look at both patient and healthcare professional preferences, around 75% of all recurrent pericarditis patients that we shared the target product profile with both KPL-3A7, but as well as current commercial and other investigational therapies in recurrent pericarditis, around 75% of those patients said that they would prefer the target product profile of KPL-3A7. And when you look on the healthcare professional side, greater than 90% of healthcare professionals say that they are highly likely to prescribe KPL-3A7 for new patients suffering from recurrent So we think that all bodes well for the future, but we continue to be highly focused on ArcLISC as well as the work that we're doing across our pipeline and portfolio.

Excellent. Thank you.

Thank you. This does conclude the question and answer session of today's program. I'd like to hand the program back to Sanjay Patel, CEO, for any further remarks.

Thanks, Operator, and I appreciate all the questions and all of you for joining the call Obviously, we look forward to providing additional updates in the future. I'm sure you can tell from today that we are very energized as we're heading to this year and we are going for brilliance as always. So thank you very much for joining in.

Thank you, ladies and gentlemen, for your participation in today's conference. This does conclude the program. You may now disconnect. Good day.