NRX Pharmaceuticals, Inc. Q3 FY2025 Earnings Call

Good morning, ladies and gentlemen, and welcome to the NRx Pharmaceuticals' Q3 2025 Earnings Conference Call. This call is being recorded on Monday, November 17, 2025. I would now like to turn the conference over to Matthew Duffy, Chief Business Officer. Please go ahead.

Thank you, Joelle, and welcome, everyone. Before we begin the call, I want to remind everyone that some statements made during this call are forward-looking and subject to risks and uncertainties that could lead to actual results differing significantly from our expectations. More details on these risks can be found in our periodic reports filed with the SEC. The forward-looking statements made today are only valid as of this date, and the company is not obligated to update them. Information shared on this call can also be found in our press release issued this morning and in the company's Form 10-Q, available on the Investors page of the NRx Pharmaceuticals website. Joining me today are Dr. Jonathan Javitt, our Founder, Chairman, and CEO; and Michael Abrams, our Chief Financial Officer. We will cover our company's progress as outlined in today's 10-Q, after which Mike will review our financials and results. After their presentations, we will take questions from investors. Jonathan is facing some technical issues this morning, so I'll begin. Since the start of the third quarter, NRx has made significant strides in developing our business. We have advanced our programs with drug approval applications in process for KETAFREE, NRX-100, and NRX-101. Additionally, we've expanded our NRX-101 pipeline and closed on several acquisition targets for our network of interventional psychiatric clinics, HOPE Therapeutics. With our initial clinic closures, we are now generating revenue and are on track to build a successful company. The focus of this call is not just about the few weeks of revenue from a single clinic, but rather the substantial shift we anticipate in the treatment of severe depression and PTSD, along with the potential for using similar technologies to address traumatic brain injury, autism spectrum disorder, Parkinson's, and cognitive decline in the future. This past quarter has marked a pivotal moment for us in this generational transformation. Additionally, a group of distinguished scientists recently presented real-world data showing an 87% treatment response and 72% remission in severe depression following just one day of treatment with a newly developed TMS device and a low dose of D-cycloserine or DCS, which is also the active ingredient in NRX-101. This development follows a well-controlled clinical trial indicating DCS more than doubles the effectiveness of conventional TMS for treating depression and suicidality. Instead of relying solely on this call for information, we recommend reviewing the supporting scientific literature available on our website. Last week, we announced that HOPE Therapeutics became the first entity to implement this ONE-D protocol in Florida in partnership with Ampa Health, and we are actively collaborating with established clinics as well as pursuing new clinic openings both in Florida and nationally. The scientists involved in that trial argue that while there may be various TMS machines capable of performing a 1-day Theta-burst protocol, no drug other than DCS has proven to enhance TMS in the scientific literature. Therefore, the results from this quarter should be viewed as the initial signs of growth, rather than a clear indication of whether these efforts will fully develop into a significant business. We expect that our expanding operations will be easier to evaluate by the time of our next conference call. Since our inception in 2015, we've worked with DCS, with our Co-Founder, Dr. Daniel Javed, starting research on this class of compounds back in 1987. NRx holds rights to over 70 patents globally related to the application of DCS in treating depression, PTSD, and other serious brain disorders. We have considerable experience in formulating and stabilizing this complex and unstable molecule. We have secured a breakthrough therapy designation IND with the FDA, and we have manufactured drugs in our warehouse that are being utilized in an expanded access protocol to support the replication of last week's impressive ONE-D findings. While many compounding pharmacies are beginning to sell DCS in response to these significant scientific developments, we will be releasing foundational scientific data to demonstrate the importance of manufacturing controls to prevent rapid degradation and impurity formation in DCS. These controls have been developed over nearly a decade of rigorous preclinical and clinical research. The combination of DCS, a neuroplastic drug, with TMS, a neuroplastic therapy, reflects not merely that two neuroplastic treatments can yield better results, but rather that drugs like DCS can significantly enhance the receptiveness of brain cells to TMS and other neuroplastic treatments, similar to fertilizing a field before planting seeds. For those new to this discussion, neuroplasticity refers to the brain's ability to grow new connections between its cells. In contrast to digital computers, where connections remain static, the brain is dynamic, continuously forming and pruning connections, which is essential to neuroplasticity. Over the last two decades, we have learned that reduced neuroplasticity in various brain regions underlies conditions such as depression, PTSD, and autism spectrum disorder. Reflecting on Dr. Javitt's 45-year career dedicated to understanding the brain, his previous experience with groundbreaking technological change aligns with our current efforts to transform neuroplastic drugs, devices, and digital therapeutics to revolutionize treatments for severe depression and PTSD today and related brain disorders affecting over a billion people tomorrow. If the data supporting these findings are accurate, it's likely that current first-line treatments for severe brain diseases, such as oral antidepressants, will become less favored due to their side effects and limited effectiveness. Moreover, this evolving understanding could help dismantle the outdated perception that brain diseases leading to behavioral symptoms, such as depression and anxiety, are fundamentally distinct from those causing conditions like Parkinson's or cognitive dysfunction, thus ensuring that patients with behavioral health problems receive the same level of medical care as those with other neurological disorders. One of the motivations behind founding HOPE Therapeutics was to foster direct engagement with the payer community amid these shifting paradigms. Transitioning to our corporate and financial results from the last quarter, it's important to note that our quarterly report captures only the first three weeks of revenue from our initial two clinics. By the end of the year, we expect to expand from two clinics to six or more within our current operations, with anticipated revenue growth in the upcoming quarters as we integrate and add to our clinic network. Notably, our initial revenues stem from ketamine and traditional TMS sessions, typically reimbursed at lower rates. Much of our future growth is likely to focus on day and short-term multi-modal treatments that offer rapid clinical results, which are already reimbursed at higher levels. For example, consider a highly trained first responder battling depression and PTSD. Often, antidepressant medications are not compatible with their return to duty, which can disqualify them from their roles. Consequently, the urgent need for effective treatment aligns with the interests of organizations like the military and law enforcement, which are invested in maintaining a prepared workforce. The costs associated with replacing frontline personnel are substantial. While many assume health insurance decisions are made by indifferent executives, they are increasingly influenced by employers who are concerned about sustaining their workforce. Often, those decision-makers include military leaders, police chiefs, and fire commissioners, who prioritize their personnel's well-being. Recently, Dr. Javitt spoke at Fort Belvoir to a gathering of senior military and veterans affairs leadership, and he shared insights with a senior advisor to the Secretary of Veterans Affairs, who reiterated that preventing veteran suicide is their top priority. We anticipate releasing a video of that presentation in the upcoming weeks. Our balance sheet has improved significantly compared to the end of the second quarter, thanks in part to long-term healthcare investors who joined us in the third quarter and invested in common stock with no attached warrants or convertible debt. Currently, NRx has secured enough operating capital to fund drug development through 2026. Additionally, as previously mentioned, we expect to generate revenue from our clinical operations and anticipate seeing revenues from ketamine sales under an ANDA by mid-2026. Our balance sheet supports our goals, as Mike Abrams will explain in more detail later, and we are poised to achieve various milestones across both sides of our business with our existing funds. Our objective remains to enhance shareholder value while fulfilling our mission of bringing HOPE to life. Now, let's review each program, starting with our preservative-free ketamine, which previously required the toxic preservative benzethonium chloride for stability and sterility. Our stability data is still on track for a three-year shelf life at room temperature. We are pursuing two parallel approval pathways: a generic route and an innovative one using different formulations to reduce pricing confusion. As noted in August, the FDA has determined these formulations represent two distinct drug identities. The first pathway is a New Drug Application (NDA) for NRX-100 addressing suicidal ideation in patients with depression, including bipolar depression. The second is an Abbreviated New Drug Application (ANDA) to make KETAFREE available for existing generic indications of ketamine. We are nearing completion of NDA preparation and expect to submit the application in the coming weeks. We are also adding over 60,000 patient encounters of real-world efficacy data, demonstrating statistically significant benefits of intravenous ketamine over nasal S-ketamine. Together with data from U.S. and European clinical trials involving more than 1,000 participants, we believe this presents a compelling case for our drug's efficacy. This represents a crucial development for our company and for individuals struggling with suicidal depression, especially since no medication is currently approved for treating suicidal ideation, and the SPRAVATO label states it has not been shown to reduce suicidality. The only current alternative for these patients is Electroconvulsive Therapy (ECT), which the PCORI trial indicated has a 30% memory loss incidence, unlike IV ketamine. We consider FDA's recent expanded Fast Track designation for us to be a strong validation, as it now encompasses all patients with suicidal ideation and depression, including bipolar depression. This is critical as the CDC reports nearly 13 million Americans seriously contemplate suicide each year, with someone dying from suicide every 11 minutes. Our leadership team was recently invited to present at Fort Belvoir, with plans to do so at VA headquarters and to Air Force leadership at Nellis Air Force Base. Secretary Collins has publicly stated that preventing veteran suicide is a key priority for him. In June, the FDA established the commissioner's national priority voucher program, which allows much quicker review times of 1 to 2 months, compared to the usual 10 to 12 months, enhances communication throughout the review process, and offers potential for accelerated approval of NRX-100. Commissioner Macri has emphasized that safe and effective drugs to prevent suicide are a top priority. Following some personnel changes at the FDA, the new leadership at the FDA's Center for Drugs has been an advocate for expedited approval of life-saving treatments addressed to unmet medical needs. To qualify for a CNPV, a product must fulfill at least one criterion related to addressing a public health crisis, meeting significant unmet medical needs, providing innovative treatments, ensuring key strategic drugs are available in the U.S., or lowering healthcare costs. NRx meets all these criteria. In Q3, we filed an ANDA for ketamine with a priority review request, branded KETAFREE. After our meeting with the FDA in August 2025, we have refiled the ANDA following their feedback on our proposed strength for KETAFREE. Last week, we received notice from the FDA indicating no major deficiencies in the revised filing, and we believe it is on timetable for a second quarter PDUFA date, the generic equivalent of a PDUFA date. We have also submitted a citizen petition to the FDA proposing that benzethonium chloride, a toxic preservative, be removed from all currently approved ketamine products—a request supported by our detailed toxicology report highlighting the issues that led to the FDA banning BZT from topical antiseptics and hand sanitizers. Importantly, benzethonium chloride is not recognized by the FDA as generally safe. As a preservative-free formulation, our ketamine represents an important advancement, and we have filed for a patent to protect our intellectual property pertaining to this product. The existing generic market for ketamine is projected to be approximately $750 million. We believe KETAFREE, manufactured in the U.S. and often without toxic preservatives, provides a better option for patients and healthcare providers. We will continue to collaborate closely with the FDA to expedite our application and offer a safer version of this vital medication to the public. Our NRX-101 program, which combines D-cycloserine and lurasidone, has taken a positive and unexpected turn. We have received breakthrough therapy designation for this drug to treat suicidal bipolar depression and are actively pursuing this goal. Our manufacturing data indicates stability lasting up to 5 years, and we have 1 million doses ready. There are over 7 million patients in the U.S. living with bipolar depression, many of whom face the risk of akathisia, a severe side effect associated with SSRIs that is closely linked to suicide. These patients are at a serious risk of self-harm. We have shown statistically significant superiority of NRX-101 over lurasidone, the current standard for reducing suicidality and akathisia in two well-controlled trials. Both NRX-101 and lurasidone are effective antidepressants, and one trial also demonstrated NRX-101's superiority in reducing depressive symptoms, comparing it to a known effective drug rather than a placebo. Given this significant unmet need, we are hopeful that the FDA will consider an application for accelerated approval for the approximately 600,000 patients who suffer from suicidal ideation in bipolar depression despite current medication treatments. Recently, a new Director for the FDA Center for Drugs has been appointed, who pioneered the accelerated approval pathway and is known for advocating rapid approvals for medicines addressing life-threatening conditions lacking available therapies. Last week, we released data indicating that low-dose D-cycloserine, again the active ingredient in NRX-101, in combination with a ONE-D TMS protocol, has garnered significant interest in enhancing depression treatment effectiveness. Like ketamine, D-cycloserine blocks the NMDA receptor and improves neuroplasticity. Recent real-world data aligns with prior randomized trials that reported that low-dose DCS more than doubles the antidepressant and anti-suicidal effects of TMS. However, DCS alone is contraindicated for patients with depression, which may hinder its acceptance among patients and clinicians. Notably, NRX-101 includes DCS but does not carry this contraindication, since the addition of lurasidone mitigates one key side effect related to NMDA inhibition. Consequently, there's a pressing need for NRX-101 to be developed in combination with TMS to treat depression, PTSD, and other disorders. We have manufactured over 25,000 doses of NRX-101 and have launched a nationwide expanded access program, allowing physicians to provide this medication free of charge to patients under expanded access and federal right-to-try regulations. We plan to conduct a confirmatory Phase 3 trial of NRX-101 to assess its effects in enhancing TMS outcomes in early 2026. The estimated market for this newly validated indication for NRX-101 exceeds $1 billion. On September 8, 2025, HOPE Therapeutics began generating revenue following the acquisition of the Dura Medical clinics in Naples and Fort Myers, Florida. HOPE has also added Cohen and Associates in Sarasota, Florida, another financially positive, revenue-generating clinic to its network. Dr. Rebecca Cohen, the Founder of Cohen and Associates, has been appointed as HOPE's Medical Director. Last week, HOPE became the first organization in Florida to introduce a one-day TMS treatment for severe depression as part of the ONE-D protocol utilizing the Ampa TMS device, which has shown an 87% response rate and a 72% remission rate from severe depression at six weeks after a single day of treatment with D-cycloserine. We are in the process of adding three more facilities this year and are actively exploring numerous acquisition opportunities across the country. With our noteworthy progress in the third quarter and a dedicated group of investors, we believe we are positioned better than ever to enhance shareholder value and tackle the national suicide crisis. We remain committed to bringing HOPE to life. Now, I will hand it over to Michael Abrams, our CFO, to discuss our financial results for the third quarter. Mike?

Thank you, Matt. For the 3 months ended September 30, 2025, the company reported a loss of operations of $4 million versus a loss from operations of $3 million for the comparable quarter in 2024. The difference is primarily attributable to $800,000 of additional research and development expenses to support our FDA initiatives for NRX-100 and NRX-101, including the previously discussed submission for preservative-free IV ketamine, and $400,000 of additional general and administrative expense which included our efforts to close, operate and identify clinic acquisition targets for HOPE. As of September 30, 2025, NRx Pharmaceuticals had approximately $7.1 million in cash and cash equivalents including approximately $3.1 million from a subscription receivable for which the company received the cash in early October, total cash as of September 30, 2025, would have been $10.3 million. For the third quarter ended September 30, 2025, the company reported revenue for the first time in its history, driven by the acquisition of Dura Medical, which closed September 8. While revenue of approximately $240,000 was relatively modest, it reflects 22 days of the full quarter in a single clinic group. Management anticipates the ability to include results for the full period during future quarters as closing anticipated additional acquisitions and organic growth of previously acquired clinics will drive meaningful revenue growth in the fourth quarter and through 2026. Transactions where we acquire a noncontrolling interest are expected to improve our overall financial position but not directly increase revenue. Finally, we remain in active discussions with several additional potential acquisition candidates and while no assurances can be given that we will close any or all of such opportunities, together, they represent total revenue of more than $20 million on an annual basis. The company believes that its current cash position will support operations at least through the second quarter of 2026 as well as provide sufficient capital for expected regulatory inflection points and complete potential additional select acquisition opportunities to expand the growing footprint of HOPE clinics. Our singular focus remains advancing our primary drug development initiatives and planned clinic acquisitions to build long-term value for our shareholders. With that...

Thank you, Mike, and thank you guys for sparing my voice this morning. I look forward to taking questions.

Operator, I believe we can begin to take questions.

Your first question comes from Tom Shrader with BTIG.

I have a couple of questions on this remarkable DCS result with TMS. Historically, is it clear that DCS is much better than Ketamine in this position? Is this truly unique to the drug? Or is it a general combination effect? And then can you give us a sense of how you would use 101 in this procedure? I assume it's not a hard co-formulation that your 101 is simply available. But how cumbersome is it to add a drug, your DCS – and can you get paid for it? Just some logistics. I know you have a lot of drug. It looks like it's exciting. Can you guys run us through the steps to actually use it?

Those are great questions. A significant amount of the foundational research has been conducted and published by Dr. Josh Brown at Harvard McLean, with support from several others. It's essential to understand that DCS must be administered at a non-NMDA antagonist dosage. While this may seem a bit technical for a conference call, it's a crucial point. DCS acts as a mixed agonist antagonist, differing from ketamine and other NMDA drugs that block the NMDA channel. Instead, DCS interacts with a ancillary unit of NMDA known as the glycine site, and at low doses, it actually serves as an NMDA agonist. More importantly, it is a highly neuroplastic drug. There is evidence suggesting that ketamine combined with TMS may reduce the effectiveness of TMS; some even argue that using ketamine alongside electroshock therapy could diminish its efficacy. All research conducted on D-cycloserine has been at low doses of 150 to 175 milligrams, which happened to be one of the strengths we formulated for NRX-101 – that's why it's available in our warehouse. In fact, it was not originally intended to be the primary strength of NRX-101 but was produced as a potential step-down dose for our clinical trial. To date, no one else has identified a different neuroplastic drug that effectively complements TMS the way D-cycloserine does. Could you please repeat the second part of your question?

What would it take for someone to get your drug if they want to add it to TMS in your clinic or anywhere else?

Well, we have an expanded access protocol for DCS under the laws that require it to be made available for expanded access. So if somebody writes to us, we're happy to provide it for this purpose as long as they provide us with the data of what happened. ClinicalTrials.gov has been a little backed up because of the government shutdown. But as ClinicalTrials.gov catches up, you'll see those expanded access protocols for DCS and TMS showing up online.

Your next question comes from Patrick Trucchio with H.C. Wainwright.

NRX-100 and suicidal depression, the FDA has identified no significant deficiencies to date. I'm wondering, first, what feedback have you received on the accelerated approval strategy? Secondly, do you still anticipate a year-end PDUFA decision? And separately, when do you anticipate learning if the CNPV is granted, and what impact that could have on the PDUFA?

Well, as we've said, we're in the CNPV process, and therefore, the NDA under Fast Track designation for NRX-101 has not been filed in its totality yet. We've said that several times, we're expecting to be heard about the CNPV this year. The main advances with that NDA are that we now have access to the real-world data that we believe massively augment the filing that we will make under accelerated approval once we learn whether we're doing it under CNPV or not, where we're expecting not only to file the original clinical trials that we've told people about, but more than 60,000 patients worth of real-world data as well that we believe provide a solid case for accelerated approval.

Right. And with the Citizen Petition now filed to remove benzethonium chloride, can you discuss how this regulatory action could reshape the market for IV ketamine and how you would ensure adequate domestic supply if the FDA moves to ban these preservative-containing formulations?

Yes. This is actually the first ketamine that's packaged in what's called a Blow-Fill-Seal presentation where instead of a glass bottle, the machinery takes a drop of polyester resin, heats it up, blows it into a container, fills it and puts it out at the back of the assembly line completely packaged and ready to ship. It takes your production capacity from a couple of hundred thousand bottles a month to 1 million or more bottles a month per assembly line, and therefore, if we had to, we could supply every vial that's required for ketamine in the United States at that kind of manufacturing capacity. Everything else that's coming in for ketamine is glass vials.

Right. And just one maybe on HOPE. The ONE-D protocol combines TMS and DCS and it shows a rapid onset of antidepressant effects. I'm just wondering how you'll be positioning HOPE to become an early adopter in the data generator for that combined treatment pathways? And as well just separately, assuming the approval of NRX-100 and NRX-101, how will you integrate those treatments into the HOPE care model once they're approved, assuming they are approved?

Well, those are 2 fantastic questions. And the ONE-D protocol is legal under the medical device laws. The coil that was used was manufactured by a company called Ampa, which has some very exciting technology not only in terms of their pioneering of the ONE-D protocol, but in terms of having built the first portable TMS one that can be taken to nursing homes, extended living facilities, you could even do it in a firehouse because it fits in 2 Pelican cases. We announced last week that we partnered with Ampa that we are the first site in Florida to be doing the ONE-D protocol, so it's readily deployable. Now, it's not specific only to that machine, but all of the ONE-D results so far that have been reported have been reported on that machine.

Your next question comes from Ed Woo with Ascendiant Capital.

Yes. Congratulations on all the progress. As NRX-100 and 101 have potential approval dates relative within the next year, hopefully, or much sooner than that? Have we talked about your clinical or commercialization strategy for both?

Ed, I'd like to listen to that question again.

Sure. Have you talked about your commercial strategy? Will you need to have a sales force to market NRX-100 and 101 when you get approval?

Well, they're very different drugs and they will need different strategies. So NRX-100, we're talking about a drug that can only be deployed in a clinic setting by a physician who we anticipate that there will be a REMS of some sort in the same way that there's a REMS for SPRAVATO. So the NRX-100 project, the preservative-free ketamine project is very much something that a company of our size can undertake. You're talking about much more of what's called a medical science liaison function than a sales function because physicians who are treating with ketamine in their office know that they want to do that and what they need is medical liaison support. It's not traditional pharmaceutical detailing. NRX-101 we're seeking an indication where we want to treat people with severe bipolar depression who have suicidal ideation despite having been treated with best available therapy. So if you take a look at the people who are currently prescribing drugs like lurasidone to treat bipolar depression, there are approximately 1,600 doctors like that in the United States. Many physicians don't want to be treating suicidal bipolar patients. So that's actually a sales force also that a company like ours could build. We anticipate it's a requirement of about 50 salespeople. We've talked to larger commercial partners in the past about NRX-101, and it's possible that we would partner with a larger commercial partner. But bottom line, NRX-100 is within our launch capabilities. NRX-101 is still within our launch capabilities, but we know that there is significant interest from larger partners.

There are no further questions at this time. I will now turn the call over to Matthew Duffy for closing remarks.

Thank you, everyone, for joining us this morning. We're extremely excited about the path ahead with 3 potential drug approvals in the subsidiary targeting multiple profitable mental health clinics, as well as our new indication with NRX-101. This concludes the NRx Pharmaceuticals Third Quarter 2025 Results Conference Call. Thank you all for participating.

Ladies and gentlemen, this concludes your conference call for today. We thank you for participating and ask that you please disconnect your lines.