Good morning, ladies and gentlemen, and welcome to Veru Inc. Investor Conference Call. All participants will be in a listen-only mode. After this morning’s discussion, there will be an opportunity to ask questions. Please note that this event is being recorded. I'd now like to turn the conference over to Mr. Sam Fisch, Veru Inc's Executive Director, Investor Relations and Corporate Communications. Mr. Fisch, please go ahead.

Good morning. The statements made on this conference call may be forward-looking statements. Forward-looking statements may include but are not necessarily limited to, statements of the Company's plans, objectives, expectations or intentions regarding its business, operations, finances and development and product portfolio. Such forward-looking statements are subject to known and unknown risks and uncertainties and our actual results may differ significantly from those projected, suggested or included in any forward-looking statements. Risks that may cause actual results or developments to differ materially are contained in our 10-Q and 10-K SEC filings, as well as in our press releases from time to time. I'd now like to turn the conference call over to Dr. Mitchell Steiner, Veru Inc's Chairman, CEO and President.

Good morning. With me on this morning's call are Michele Greco, CFO, CAO; Michael Purvis, Executive Vice President, General Counsel and Corporate Strategy; and Sam Fisch, Executive Director of Investor Relations and Corporate Communications. Thank you for joining our call. Veru is dedicated to the development of novel medicines for the management of two of the most prevalent cancers, breast cancer and prostate cancer. One of our anti-cancer drugs sabizabulin has dual antiviral and anti-inflammatory effects. So it is also being developed for the potential treatment of hospitalized COVID-19 patients at high risk for acute respiratory distress syndrome, which remains a global dire unmet medical need. The company has a commercial sexual health division called UREV, which includes two FDA-approved products, ENTADFI, a new treatment for BPH, which is Benign Prostatic Hyperplasia, and the FC2 female condom, an internal condom for the dual protection against unplanned pregnancy and the transmission of sexually transmitted infections. The revenue from the sexual health division is being used to largely fund the clinical development of our late-stage drug candidate assets, which aim to address multibillion dollar premium market opportunities. This morning, we will discuss Veru's business strategy, the clinical development of our drug pipeline and the commercialization of our products. We will also provide financial highlights for our first quarter fiscal year 2022. COVID-19 global cases, hospitalizations, and deaths are at the highest level since the start of the pandemic. Some of the antibody drugs are not effective against the Omicron variant. It is clear that an effective and safe oral therapeutic that prevents deaths in hospitalized patients with moderate to severe COVID-19 infection who are at high risk for acute respiratory distress syndrome is desperately needed. We strongly believe that sabizabulin with its antiviral and anti-inflammatory properties and a favorable safety profile can be that greatly needed oral therapy for hospitalized patients with COVID-19. Sabizabulin disrupts the intracellular transport of the coronaviruses by microtubules. This is a process that's required by all variants of COVID-19, including Omicron, to cause infection. While there have been recent developments evaluating the Merck drug, molnupiravir, and the Pfizer drug, paxlovid, for the treatment of unhospitalized patients with mild to moderate COVID-19 who are at relatively low risk of dying. Sabizabulin, in contrast, is being developed for hospitalized patients with moderate to severe COVID-19, who are at high risk of death. Our positive Phase II clinical study in hospitalized COVID-19 patients at high risk for acute respiratory distress syndrome shows that sabizabulin treatment resulted in an 82% relative reduction in deaths compared to placebo. If our Phase II clinical results are replicated to any significant degree in our global Phase III clinical study, we believe sabizabulin would fill a significant unmet medical need for hospitalized patients. We are conducting a Phase III COVID-19 clinical study, which is a double-blind multicenter, multinational randomized 2:1 placebo-controlled study, evaluating a daily oral 9 milligram dose of sabizabulin for up to 21 days versus placebo in 300 hospitalized COVID-19 patients with high risk for acute respiratory distress syndrome. The primary efficacy endpoint will be the proportion of patients who die on study up to day 60. Secondary endpoints will include the proportion of patients without respiratory failure, days in the ICU, WHO ordinal scale for Clinical Improvement change from baseline, days on mechanical ventilation, days in the hospital, and viral load. The study is being conducted in the U.S., Brazil, Argentina, Mexico, Colombia, and Bulgaria. In January of 2022, the FDA granted Fast Track designation with a Phase III COVID-19 registration program, a distinction that underscores the urgent need for new, novel, and effective therapies to be used along with vaccinations to combat this COVID-19 pandemic. The company has sufficient clinical drug supply on hand to complete the Phase III clinical study and to help fund the commercial drug to supply the needs of the U.S. population assuming confirmatory positive clinical results and FDA approval; we are seeking funding from BARDA and other agencies. The company anticipates having the results for the Phase III COVID-19 clinical trial in the first half of calendar year 2022. As for our breast cancer drug portfolio, we have an expansive metastatic breast cancer program with two of our drug candidates, Enobosarm and Sabizabulin. Enobosarm is an oral selective androgen receptor targeting agonist which has shown efficacy in Phase II clinical studies in a heavily pre-treated hormone receptor positive metastatic breast cancer patient population, with an excellent safety profile, without causing unwanted masculinizing adverse side effects. Enobosarm represents the first novel endocrine therapeutic approach to breast cancer in decades. Our second drug candidate, sabizabulin, is an Oral Cytoskeleton Disruptor that targets unique binding sites and crosslinks microtubules, a well-validated cancer target, resulting in promising efficacy and a favorable safety profile without clinically relevant neurotoxicity, neutropenia, or alopecia. Furthermore, chronic oral daily administration of sabizabulin is feasible. Our clinical development strategy allows us to potentially become an important treatment option for a variety of large market opportunities in hormone receptor positive metastatic breast cancer. In the third line treatment setting for hormone receptor positive metastatic breast cancer, we have two clinical programs based on the patient's androgen receptor nuclei staining or expression levels in the breast cancer tissue. In patients with greater than or equal to 40% androgen receptor expression, we are actively enrolling a global Phase III ARTEST registration clinical study to evaluate enobosarm monotherapy with a third-line treatment of AR+, ER+, HER2- metastatic breast cancer. Enobosarm targets the androgen receptor, which has tumor suppressor activity in AR+, ER+, HER2- metastatic breast cancer without causing the unwanted masculinizing side effects. Enobosarm has extensive non-clinical and clinical experience having been evaluated in 25 separate clinical studies in approximately 1,450 patients, including three Phase II clinical studies in advanced breast cancer involving more than 250 patients. This means we have a very good understanding of the favorable safety profile with enobosarm. As for efficacy, there were two Phase II clinical studies conducted in women with AR+, ER+, HER2- metastatic breast cancer where enobosarm demonstrated significant antitumor efficacy in a heavily pretreated population that developed tumor progression after receiving estrogen-blocking agents, chemotherapy, and/or a CDK4/6 inhibitor. And again, in this population, enobosarm was well tolerated with a favorable safety profile. We are conducting a Phase III multicenter international open label, randomized 1:1 ARTEST registration clinical trial to evaluate the efficacy and safety of enobosarm monotherapy versus an active comparative, either exemestane plus or minus everolimus or a selective androgen receptor modulator for the treatment of AR+, ER+, HER2- metastatic breast cancer in approximately 210 patients with greater than or equal to 40% AR expression in breast cancer tissue who have previously received a nonsteroidal aromatase inhibitor, fulvestrant, and a CDK4/6 inhibitor. In January of 2022, the FDA granted Fast Track designation to our Phase III ARTEST registration program. Fast Track designation aims to expedite the development and review of new drugs that are intended to treat serious or life-threatening conditions and demonstrate the potential to fill unmet medical needs. Filling an unmet medical need is defined as providing a therapy where none exists or providing a therapy which may be potentially better than available therapy. Patients who have been found to have less than 40% AR expression in their breast cancer tissue, we have a planned sister study, which is an open-label, multicenter, randomized 1:1 Phase IIb study evaluating the efficacy and safety of sabizabulin 32 milligrams monotherapy versus the active comparative either exemestane +/- everolimus or SERM for the treatment of ER+, AR+ metastatic breast cancer in approximately 200 patients who have previously received a non-steroidal aromatase inhibitor, fulvestrant, and a CDK4/6 inhibitor. For clarity, this means we have a sister study to randomize patients that did not qualify for the Phase III ARTEST study because their AR expression in the breast cancer tissue was too low. We received the safe to proceed letter from the FDA, and this Phase IIb study is expected to commence in calendar Q1 2022. We are also moving enobosarm therapy earlier in the treatment sequence into the second line treatment settings AR+, ER+, HER2- metastatic breast cancer by targeting patients with AR+ breast cancer expression greater than or equal to 40% in the Phase III ENABLAR-2 clinical study. CDK4/6 inhibitor and estrogen-blocking agent combination has become the first line therapy for patients with ER+, HER2- advanced breast cancer. Unfortunately, almost all patients will develop drug resistance and will eventually develop breast cancer progression. Based on the positive Phase II clinical data and the preclinical data supporting the use of enobosarm in combination with the CDK4/6 inhibitor in patients who are CDK4/6 inhibitor and estrogen-blocking agent resistant, we plan to conduct a Phase III multicenter, open-label, randomized 1:1 active control registration clinical study named ENABLAR-2 to evaluate the efficacy and safety for enobosarm and abemaciclib combination therapy versus an alternative estrogen-blocking agent in subjects with AR+, ER+, HER2- metastatic breast cancer who have failed first line therapy with palbociclib, which is a CDK4/6 inhibitor, plus an estrogen-blocking agent and have greater than or equal to 40% AR expression in their breast cancer tissue. We plan to enroll approximately 186 patients in this Phase III clinical study. We recently announced that we have entered into a Clinical Trial Collaboration and Supply Agreement with Lilly for the ENABLAR-2 Phase III clinical study. Under the terms of the non-exclusive clinical trial collaboration and supply agreement, Veru is responsible for conducting the clinical trial, while Lilly will supply abemaciclib for the study. Veru maintains full exclusive global rights to enobosarm. We are looking forward to our collaboration with Lilly on the ENABLAR-2 Phase III clinical trial, which is expected to commence in calendar Q1 2022. We are partnered with Roche Ventana, a major global diagnostics company to develop a companion diagnostic androgen receptor test. In the Phase II 801 study, we have determined that the presence and the amount of the androgen receptor expression in breast cancer tissue are important for enobosarm's targeted anti-tumor activity. In fact, we identified that patients who have greater than or equal to 40% androgen receptor staining by immunohistochemistry, which is a measure of androgen receptor expression in their breast cancer tissue, are the patients that are most likely to have an anti-cancer response to enobosarm. Based on this observation, the FDA recommended that we develop a companion diagnostic test to determine the patient's AR expression status. Consequently, we have partnered with Roche Ventana Diagnostics, a world leader in oncology companion diagnostic tests, we are developing and if approved plans to commercialize the companion diagnostic androgen receptor test. The companion diagnostic test is being developed in parallel with the Phase III ARTEST clinical study. Although the company has been planning to commence a single-arm, sabizabulin plus enobosarm combination for metastatic triple negative breast cancer patients in a Phase II clinical study that was supposed to start early in this calendar year, we have now decided to focus our finite resources on more advanced pipeline opportunities and suspend work on this trial. Nevertheless, the company remains committed to advancing triple negative breast cancer study in the future. As you can see, we have developed an important and deep breast cancer program dedicated to developing effective treatments. We have late clinical stage studies addressing three separate indications. The first indication is evaluating sabizabulin for the third-line treatment of metastatic castration-resistant prostate cancer in the Phase III Veracity study. Several novel androgen receptor targeting agents include enzalutamide and apalutamide. Unfortunately, most men with metastatic castration-resistant prostate cancer will develop tumor progression while receiving an androgen receptor targeted agent, with 60% to 70% of patients progressing by 12 to 18 months and 30% to 40% of men having no benefit at all. New effective and well-tolerated treatment alternatives that do not target the androgen receptor axis and that have an easy mode of administration are greatly needed. Sabizabulin is a member of a novel class of drugs that disrupts the cytoskeleton by targeting unique binding sites of microtubules, which results in an improved safety profile. In preclinical models, there was no evidence of significant liver toxicity, neurotoxicity, and neutropenia with sabizabulin treatment. This more tolerable safety profile has also been confirmed in a first-in-man Phase Ib/II study in metastatic castration-resistant prostate cancer patients. We will be presenting updated clinical data from the positive Phase Ib/II study of sabizabulin in 80 men with metastatic castration-resistant prostate cancer who have progressed on at least one novel androgen receptor targeting agent at the ASCO Genitourinary Cancers Symposium being held February 17th and 19th in San Francisco, California. Veru is conducting an open-label 2:1 multicenter Phase III Veracity clinical study evaluating sabizabulin 32 milligrams versus an alternative androgen receptor targeted agent for the treatment of chemotherapy naive men with metastatic castration-resistant prostate cancer who had tumor progression after previously receiving at least one androgen receptor targeted agent. The primary endpoint is radiographic progression-free survival; enrollment for the Phase III Veracity clinical study is on track, and we expect to enroll approximately 245 patients from 45 clinical centers in the U.S. A second clinical study is evaluating VERU-100, a GnRH Antagonist 3-Month Depot formulation in a Phase II dose-finding clinical study for the treatment of Hormone Sensitive Advanced Prostate Cancer. Androgen Deprivation Therapy remains the mainstay primary therapy for advanced prostate cancer, but current androgen deprivation therapy drug products have several important clinical shortfalls. LHRH agonists' initial administration leads to a testosterone surge that lasts up to 21 days. FIRMAGON, a GnRH antagonist, is a large volume subcutaneous injection formulation designed for only a single month release. Relugolix is an oral GnRH antagonist and has the potential for poor patient compliance. In contrast, VERU-100 has a target product profile that addresses a number of these important clinical shortfalls of the currently commercially available androgen deprivation therapy products. VERU-100 is a long-acting GnRH antagonist, designed to be administered as a small volume, subcutaneous three-month depot injection. VERU-100 drug products are expected to immediately suppress testosterone with no testosterone surge, and VERU-100 is a long-acting injected depot that would ensure patient compliance while on treatment. Furthermore, as a class, GnRH antagonists have been shown to have fewer cardiovascular adverse events than LHRH agonists. We are conducting a Phase II dose-finding clinical study of VERU-100 androgen deprivation therapy in 35 men with hormone-sensitive advanced prostate cancer. Although the study is ongoing, the preliminary clinical data are promising. The Phase III registration clinical study design is already agreed upon with the FDA. It will be a single-arm study which will enroll approximately 100 men; maintenance of castrate blood concentration of testosterone is the primary endpoint. After the Phase II dose-finding study is completed, we will initiate the Phase III clinical study which is anticipated to begin in the calendar second half of 2022. In our third late-stage clinical study, we plan to advance Zuclomiphene for the treatment of hot flashes caused by androgen deprivation therapy in a planned Phase IIb clinical study later in the calendar year of 2022. So in summary, we will have three late-stage clinical studies for the management of advanced prostate cancer in the calendar year 2022. Now Veru has a commercial sexual health division called UREV, which includes two FDA approved products, FC2 for the dual protection against sexually transmitted infections across the U.S. As a result, FC2 is now available through multiple sales channels. In particular, we have partnered with fast-growing, highly reputable telemedicine platform companies to bring our FC2 product to patients in a cost-effective and highly convenient manner. Our sales strategy is not only to seek additional telemedicine and Internet pharmacy service partners but also to create our own direct-to-patient portal. ENTADFI has been shown to be more effective for the treatment of benign prostatic hyperplasia than finasteride alone without causing impotence. ENTADFI was approved by the FDA in December of 2021, and commercialization plans are now underway. The plan is to officially launch ENTADFI next quarter. ENTADFI is expected to be marketed and distributed also by our own direct-to-patient telemedicine and Internet pharmacy services platform. We have also partnered with GoodRx, a U.S.-based digital resource for healthcare, to reach their almost 20 million monthly visitors, which include both consumers and healthcare providers, to build awareness to send patients to our telemedicine platform and to convert existing men on BPH treatments—those treatments that cause sexual side effects— to ENTADFI. There are over 45 million prescriptions filled annually for drugs to treat BPH. We plan to augment our marketing and sales effort by seeking digital partners in the U.S. and outside the U.S. I will now turn the call over to Michele Greco, the CFO and CAO to discuss the financial highlights.

Thank you, Dr. Steiner. As Dr. Steiner indicated, the company has several significant clinical development processes. Let's review the first quarter results. Net revenues were $14.1 million compared to $14.6 million in the prior year quarter. The prior year quarter included net revenues of $863,000 related to PREBOOST, which the company sold on December 8, 2020. The company reported FC2 sales growth in its U.S. prescription business with net revenues up 27% to $11.6 million from $9.1 million in the prior year quarter. Net revenues for the public sector business were $2.6 million compared to $4.7 million in the prior year quarter. The prior year quarter included revenues related to the Brazil and South African tenders. Overall gross profit was $11.8 million or 84% of net revenues compared to $10.8 million or 74% of net revenues in the prior year quarter. The increase in gross profit and gross margin is driven primarily by increased sales in our U.S. FC2 prescription business. This quarter's 84% gross margin is the highest in the company's history. Operating expenses for the quarter increased to $16.8 million compared to the prior year quarter of $10.1 million. The increase is primarily driven by research and development costs, which increased to $10.1 million from $5.7 million in the prior year quarter and increases in personnel and related costs to prepare to commercialize ENTADFI. During the prior year quarter, the company sold PREBOOST for $20 million, $15 million in cash and $5 million in notes receivable due in two installments over an 18-month period. The sale of PREBOOST resulted in an $18.4 million pre-tax gain. The operating loss for the quarter was $5 million compared to operating income of $19.2 million in the prior year quarter. This change is primarily due to the gain on the sale of PREBOOST of $18.4 million plus the increase in research and development costs of $4.4 million. Non-operating expenses were $1.3 million compared to $1.9 million in the prior year quarter and primarily consisted of interest expense and change in the fair value of the derivative liabilities related to the synthetic royalty financing. We entered the synthetic royalty financing during March of 2018. For the quarter, we recorded a tax expense of $115,000 compared to $78,000 in the prior year quarter. The bottom line results for the quarter were a net loss of $6.4 million or $0.08 per diluted common share compared to net income of $17.2 million or $0.23 per diluted common share in the prior year quarter. The company has net operating loss carryforwards for U.S. federal tax purposes of $38.6 million, with $29.5 million expiring in years through 2040 and $9.1 million which can be carried forward indefinitely. Our U.K. subsidiary has net operating loss carryforwards of $63.5 million, which do not expire. Now looking at the balance sheet, as of December 31, 2021, our cash balance was $116.1 million. Our accounts receivable balance was $8.1 million and our notes receivable related to the sale of PREBOOST were $2.5 million. Our net working capital was $131.8 million at December 31, 2020 compared to $136 million at September 30, 2021. Overall, we are delighted to see the growth in the U.S. FC2 prescription business, and looking forward to increasing sales in the global public sector business. This revenue source together with our strong balance sheet continues to be the source of funds we use to invest in our promising pharmaceutical clinical development programs as we continue to transform our company into a premium oncology biopharmaceutical company seeking large market opportunities in breast and prostate cancers as well as being opportunistic by joining the global efforts to find effective treatments for COVID-19. Now I'd like to turn the call back to Dr. Steiner.

Thank you, Michele. In summary, we've had a highly productive financial first quarter, which has allowed us to significantly advance our clinical oncology programs. We've organized our FDA approved products into a sexual health division called UREV. We are now entering our sixth year of growth in our FC2 U.S. prescription business. We are executing on a solid plan to expand partnerships and to launch our own direct-to-patient telemedicine and Internet pharmacy services portal. We plan to commercially launch ENTADFI through our own direct-to-patient telemedicine and international services portal. And we have partnered with GoodRx to drive awareness and prescription conversion. Both programs should allow us to continue the robust growth of revenue from the UREV sexual health division. Having these resources in place will allow us to continue to advance our deep late clinical stage breast cancer and prostate cancer programs, as well as a Phase III COVID-19 clinical study. We are quite pleased to have recently received Fast Track designation from the FDA on two of the company's major drug development programs this past month. We anticipate a steady flow of important positive news for Veru over the next few months to a year. We are committed to driving shareholder value by developing and commercializing novel medicines, addressing significant unmet medical needs for the management of breast cancer and prostate cancer and being opportunistic by developing sabizabulin for hospitalized COVID-19 patients and those at high risk for acute respiratory distress syndrome and death. With that, I'll now open the call to questions.

Thank you. Ladies and gentlemen, at this time, we'll begin the question-and-answer session. The first question today comes from Brandon Folkes with Cantor Fitzgerald. Please go ahead.

Hi, thanks for taking my questions and congratulations on all the progress. Maybe just first on the COVID program, just given that to the near-term catalyst. How do you view the bar having shifted or not on the COVID endpoint, especially around mortality? And then along those lines, do you think that the secondary endpoints alone could support an approval here?

So just say the first part about mortality, again. So what about the primary endpoint? Do you think that agencies have shifted their view on endpoints, right? So if you don't—if not successful on mortality, do you think these secondary endpoints alone could still support an approval from the regulatory agencies?

Great. Thank you very much.

So, the answer is I don't think they're switching at all on the primary endpoint. I think that, if you've seen some recent activity with some people reporting results now on their primary endpoint, at the beginning of any clinical trial, you state your primary endpoint. I mean, that's what defines success in the trial. Deaths we are trying to deal with in something as horrible as the pandemic. Mortality is a very hard endpoint; you can’t fake a death. With that said, no, I do not think agencies are shifting on their desire to see an impact in mortality. However, having said that, there are key secondary endpoints that if you miss mortality and you hit these other ones, there could be a discussion with the FDA that these can stand on their own. But that's a discussion with the FDA. Now, one thing that gives us comfort is, as you know, the space has gotten crowded with pre-hospitalized patients. So, patients that are not in the hospital is no longer an unmet medical need. You've got the Pfizer drug, the Merck drug and others. In the hospitalized setting, what we've learned is that the FDA has indicated with the Omicron variant that some of these antibody drugs that are currently out there, for people in the hospitalized setting should not be used. The fact that we got Fast Track designation by the FDA for hospitalized patients means it’s still an unmet medical need. Therefore, if you have an unmet medical need and you successfully hit a secondary endpoint and you don’t hit on mortality, that’s a little different from there being other options out there. In that setting, I think we have a lot of room to discuss with the FDA with key secondary endpoints, assuming that’s what you hit in a setting of an unmet medical need.

Great. Thank you very much.

Thank you.

The next question comes from Leland Gershell with Oppenheimer. Please go ahead.

Hey, good morning. Thank you for taking my questions. I want to ask Mitch with respect to your developments in breast cancer, given that the androgen receptor now appears to be a tumor suppressor in breast cancer. Want to know, as you divide between those with their expression above 40% and below 40%. How that breaks down with respect to the size of the fractions of the population with breast cancer with those levels of AR expression? Would that thinking be correct that more advanced ER+ HER2- breast cancer would be more enriched in the AR, given that those tumors are likely more resistant to therapy given their expression of AR? Also, I want to ask with respect to ENTADFI, what potential peak revenue might we expect for that product? And give us a sense of what your margins maybe on that product?

So the first question basically is trying to understand the patient population of AR positivity. The way to look at it is that men and women are born with the same machinery to make breast tissue. Why is it that women develop breast tissue while men do not? The answer is the same machinery means there is an estrogen receptor and there is an androgen receptor. In women, estrogen and novel androgens develop breast; in men, androgens and novelestrogens—you don’t get breast. It’s a tremendous suppressive growth. So it's not surprising that about 90% of breast cancer tissue will have androgen receptor expression. So now the question becomes, and the question you’re asking is the enrichment part, meaning greater than 40%, less than 40%. When you look at the numbers, about 85% of breast cancers are ER+. Of those 85% that are ER+, about half will be AR+ above 40%. It’s still a huge market and pretty prevalent target that we can have an opportunity to hit. Fifty percent would be AR less than 40 and less than 50% would be AR+ greater than 40%. That’s the reason why we have the sabizabulin trial, as the sister trial because we know when we go out there and start looking for patients with metastatic AR+ breast cancer, that half of them roughly will be candidates for enobosarm. We’ve got another active agent in breast cancer. Why not allow that patient to have a choice of door number one and door number two? Door number one, if the androgen receptor is greater than 40% expression, you get to go on enobosarm. If you're less than 40%, you get to go on sabizabulin. So we have two bites of the apple there. Both of them are huge markets. So the demographics are in our favor. Interestingly, we did see an independent presentation at the San Antonio Breast Cancer Meeting this past December that showed—and maybe this explains why the combination of CDK4/6 inhibitor with enobosarm could be interesting because it turns out that this is not static; it’s pretty dynamic. The androgen receptor expression can change and it can change with the actual treatment that you’re getting. What the San Antonio study showed is that one of the reasons why the combination of a CDK4/6 inhibitor with enobosarm makes sense is that the CDK4/6 inhibitor actually induces upregulation or the expression of androgen receptor in breast cancer tissue. Another way of saying this is if enobosarm is trying to look for the androgen receptor and the CDK4/6 inhibitor makes more androgen receptor, that may explain the potential synergy between the two. It’s not just adding two drugs together to see an enhanced effect, but it could really be a significant synergistic effect. As it relates to ENTADFI, we have not given guidance except to say that we think we’re on incredibly sure footing for a couple of reasons. One, there really hasn’t been a new BPH drug in many, many years. We would be the first new BPH drug. As you know, all the BPH products have some sort of sexual side effect, and finasteride in particular, which is very popular, which shrinks the prostate, has one of the number one side effects of impotence. By combining finasteride with tadalafil, ENTADFI becomes—not just a new BPH medicine, it's a new chemical entity in a sense that it's not substitutable. You can’t substitute it. It stands on its own, which means it's branded. We have a branded product that could have a branded price, viewed as branded by insurance companies, including Medicare. Our pricing will be comparable to a branded product in the BPH space. The fact that we don’t have those sexual side effects of impotence in the combination compared to finasteride alone really gives us an opportunity to convert established patients who are having problems—that's low-hanging fruit to us. The most recent data that I've seen indicates this is still about a $1 billion market with 45 million prescriptions. If you can convert 1% or 2% of those patients into a branded product, you're already starting to hit numbers that are well above $200 million. We think there's real upside here, but we have not given any guidance. We just believe it's a big market, and we have a differentiated product that holds a branded price, and we’re going to be taking advantage of telemedicine—not only telemedicine, but we’re going to take advantage of GoodRx, whose incredible breadth will allow us to reach and drive awareness. GoodRx spends about $300 million or $400 million a year driving people towards their website, not just consumers but healthcare providers as well. So, to be able to drive awareness and to focus primarily on digital advertising toward those patients who are most in need efficiently gives a real target, and even to hit 1% or 2%, or 3%, or 4% seems doable. This could be a very important product to help us continue to drive the robust revenue that we're seeing from UREV. By putting ENTADFI with FC2, the two FDA-approved products just ensures that we can continue to maintain and largely pay for the clinical development of our products, particularly in an environment where biotech seems to be having a rough spell. If you can look at our balance sheet and see what we have in the bank, it appears that this model is working. We can adjust what revenues come in, which is significant with our development program, and strategic positions us that our shareholders will see these multibillion dollar opportunity products without significant dilution, typically associated with biotech companies that constantly need to raise money every six to twelve months.

Great. Thank you.

The next question comes from Christopher Howerton with Jefferies. Please go ahead.

Hi. Good morning and thanks for taking the questions. Really appreciate all the progress and the color this morning, Mitch. Maybe just two questions for me. One would be, could we get a little more color around the strategic decision to no longer pursue triple negative breast cancer with just competition in terms of like Trodelvy and other options making that less commercially viable at this point? Or I guess, what is some of the other thinking around pausing that program? And then the second one would be abemaciclib. Could you just give us some thoughts around the market share and why that's the right partner for enobosarm and what that might mean for the commercial opportunity, let’s say, for second-line HER2+?

Yes. Two very, very good questions. Okay, so let's start with the first one. The first one is purely a prioritization decision. We still believe there is a major market in triple negative breast cancer. If you look at Trodelvy, they developed a compound for patients with metastatic triple negative breast cancer that have failed two systemic chemotherapies, and that drug was bought by Gilead for $24 billion. So there is a market there, and we have two oral therapies, enobosarm and sabizabulin. We don’t see the neutropenia and all the other stuff and the black box stuff that you see with Trodelvy. We think there’s a real opportunity, but we had to make a financial decision. As I mentioned in the previous question, I don’t know what’s happening out there in the biotech space. I think a lot of companies are going to be in trouble if they think the markets are wide open for them to raise money. Our thinking is we have money in the bank, so that is a real reason why we need to be prudent with our resources and prioritize them carefully. Look at our burn rate—our cash usage is small because we’ve offset it with revenue coming from our sexual health business. To make sure until I see things open up, we’ve got a lot going on. We’ve got three or four Phase IIIs and we’ve got a Phase IIb that are soon to become a Phase III. We said, let’s pause on the triple negative breast cancer program and align spend with what we think will be coming in with our revenue from the UREV business, ensuring we have substantial resources in the bank at the end of the year. If it looks like we have more revenue coming in because of ENTADFI, we can make further decisions to move forward with another trial for it. We’re blessed that we have new chemical entities that are promising. But I think no one will get mad at us for seeing through some of these Phase III programs because it will put us in a different market cap and financial setting, allowing us to consider further programs. So it’s purely a prioritization play. It has nothing to do with the market; I think the market is a big opportunity, but we’re dealing with numerous large opportunities, and we just need to prioritize them. As for your second question about abemaciclib, here's a very interesting point about why we chose this partnership. The CDK inhibitors changed the landscape because they became the standard of care in first-line breast cancer treatment if you are ER+, HER2-. That’s the largest population of breast cancer patients, and the company that owns that space right now is actually Pfizer, given that palbociclib in combination with estrogen-blocking agents is widely used. Unfortunately, the fortunate part is that women will see between 24 and 30 months of progression-free survival, which is unbelievable. Yet, they will all develop progression eventually. When they progress, there’s really nothing approved and nothing in the NCCN guidelines that follows a CDK4/6 inhibitor, so this phase is wide open. It makes sense to go into the second line with a strategic agent, enobosarm, which has shown in preclinical models that the combination of enobosarm with a CDK4/6 inhibitor could work synergistically. If 80% of patients and first line using palbo, they need a new alternative—abemaciclib could be that new alternative. It's very strategic to partner with Lilly on this one because their agent, which is a good one, could be effectively partnered with enobosarm for those who have failed first line therapy.

That makes a lot of sense. I really appreciate it. Thank you, Mitch.

Thank you.

The next question comes from Yi Chen with H.C. Wainwright. Please go ahead.

Thank you for taking my questions. My first question is, could you tell us whether the enrollment speed for the ARTEST study and the VERACITY study is meeting your expectation?

Yes. The answer to your first question, both the ARTEST and VERACITY studies are enrolling on track.

Got it. Thanks. And could you tell us what you expect regarding revenue from ENTADFI for this fiscal year?

Yes. So thank you for the question. We are not giving guidance on expected revenue. What we have said is a couple of things: there are 45 million prescriptions filled each year for BPH. Almost all BPH products cause some form of sexual dysfunction. We know that finasteride products result in impotence. The combination of finasteride with tadalafil, which is ENTADFI, does not show that adverse effect. Thus, there’s a real opportunity to convert patients to this combination therapy. The BPH market is approximately $1 billion, with 2-3% of that represented by branded products, which amounts to about $300 million-$400 million. By converting just 1% or 2% of that market to ENTADFI, we see significant potential revenue.

Okay. Regarding the triple negative breast cancer program, do you think there's a chance you might reactivate the program in the future and how soon might that happen?

Yes. The answer is absolutely we're committed to reactivating it in the future. It is purely a timing and resource prioritization decision given current market conditions and the presence of multiple Phase IIIs underway, especially regarding COVID-19. This prompted us to pause to manage financial resources effectively and track market stability. If things change or if we see growth in revenue from ENTADFI and FC2, we could resume the trial quickly, as we already have the protocols written and the drugs ready. We can reactivate it rather swiftly when conditions allow.

Got it. Are there any parties interested in purchasing the UREV Sexual Health Division from the group?

Yes, there are parties interested in purchasing it. The real question for us is ensuring we get the right value for our shareholders and make the most of our revenue base. Right now, it is generating substantial income, and we see opportunities to enhance its value further. We aim to grow from a single product to a broader sexual health brand. By having two products and developing a telemedicine platform ourselves, we increase the value of the division. In the meanwhile, we are enjoying the cash flow from this business while maximizing its potential value for future decisions.

Thanks for taking my questions and congratulations on the progress. Regarding COVID-19 patients, what are you seeing there? Is it fair to estimate that you are close to completion of enrollment given that you are planning to release data in the first half?

I apologize; could you clarify your question regarding hospitalizations? Yes, we are on track to complete the enrollment for the study as we plan to have data for the first half of this year. Hospitalization rates have regrettably increased across the world, which may facilitate our enrollment goals. There are about 140,000 new hospitalizations occurring weekly—an all-time high since the pandemic began. Unfortunately, as you know, hospitalizations and deaths lag behind new case counts. What we are seeing is that the patients who do make it to the hospital and those in ICU, especially at risk for acute respiratory distress syndrome, have a level of death rates comparable to previous variants. That being said, we believe we will have clinical data for hospitalized patients in the first half of the year. This is evident as there are currently no medicines available for them, and having received Fast Track status from the FDA further clarifies this unmet need.

Okay. Regarding enobosarm and sabizabulin, what kind of interactions have you had with EMA, and can the ongoing trials be leveraged for approval?

Regarding the EMA, we have all our interactions with the FDA. Our interaction with EMA regarding international studies is expected next year when we file the proper paperwork; we’ll approach them for scientific advice. At this stage, we’re focusing on the U.S., and if we partner with someone who can expedite the process internationally, we will be in a good position.

Finally, regarding COVID-19 external funding, is the funding primarily for manufacturing?

Yes, most external funding will focus on increasing procurement and distribution efforts. Once we have Emergency Use Authorization, the government will need to buy and distribute the treatment widely. We feel confident that with a successful Phase III trial and an EUA, we should secure funding to help scale-up production and distribution. While BARDA was previously quiet in terms of funding these opportunities amid the wave of vaccines and antibody drugs, they are typically quite active post-approval, so we aim to take advantage of that.

Thanks so much.

Thank you.

Ladies and gentlemen, this concludes our question-and-answer session. I would now like to turn the conference back over to Dr. Mitchell Steiner for any closing remarks.

Thank you, everybody. I appreciate you joining us on today's call, and I look forward to updating all of you in our progress in our next investors call. Thank you again.

The digital replay of the conference call will be available beginning approximately noon Eastern Standard Time, February 9 by dialing 1 (877) 344-7529 in the U.S. and 1 (412) 317-0088 internationally. You will be prompted to enter the replay access code, which will be 3664461. Please record your name and company when joining. This conference has now concluded. Thank you for attending today's presentation.