ANI Pharma (ANIP) Q4 2025 Earnings Call Transcript

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DATE

Feb. 27, 2026 at 8 a.m. ET

CALL PARTICIPANTS

• President and Chief Executive Officer — Nikhil Lalwani
• Senior Vice President and Chief Financial Officer — Stephen Carey
• Senior Vice President and Head of Rare Disease — Christopher Mutz

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TAKEAWAYS

• Total revenue -- $883.4 million for the full year, an increase of 44% year over year.
• Fourth quarter revenue -- $247.1 million, up 30% over the prior year's quarter.
• Cortrophin Gel net revenue -- $347.8 million in 2025, an increase of 76% year over year.
• Cortrophin Gel Q4 revenue -- $111.4 million, reflecting 88% growth over the prior year quarter.
• Cortrophin Gel utilization in acute gout -- Comprised about 15% of total Cortrophin Gel utilization in 2025.
• ILUVIEN net revenue -- $74.9 million for the year, and $19.8 million in the fourth quarter.
• Generics revenue -- $384.1 million in 2025, growing 28% year over year.
• Fourth quarter generics revenue -- $100.8 million, marking 28% growth over the prior year period.
• Non-GAAP gross margin -- 61.6% for the year, down 10 basis points compared to the prior year.
• Adjusted non-GAAP EBITDA -- $229.8 million for the year, up 47% year over year; $65.4 million in Q4, up 31% over prior year.
• Adjusted non-GAAP diluted EPS -- $7.89 for 2025 versus $5.20 the previous year; Q4 adjusted EPS of $2.33 versus $1.63 prior year.
• Full-year cash flow from operations -- $185.2 million in 2025.
• Year-end cash position -- $285.6 million in unrestricted cash, increasing $140.7 million from the prior year's end.
• Outstanding debt -- $629.1 million principal value as of year-end, including senior convertible notes and term loan.
• Gross leverage -- 2.7x full-year adjusted non-GAAP EBITDA; Net leverage -- 1.5x full-year adjusted non-GAAP EBITDA at year-end.
• 2026 net revenue guidance -- $1.055 billion to $1.115 billion, representing growth of 19% to 26% over 2025.
• 2026 Cortrophin Gel revenue guidance -- $540 million to $575 million, or 55% to 65% year-over-year growth.
• 2026 ILUVIEN revenue guidance -- $78 million to $83 million, representing 4% to 11% year-over-year growth.
• 2026 adjusted non-GAAP EBITDA guidance -- $275 million to $290 million, implying 20% to 26% year-over-year increase.
• 2026 adjusted non-GAAP diluted EPS guidance -- $8.83 to $9.34, reflecting growth of 12% to 18% year over year.
• 2026 adjusted gross margin guidance -- 59.3% to 60.3%, with decline attributed to higher royalty-bearing sales and non-recurrence of certain exclusivity revenues.
• Cortrophin Gel market expansion -- A new 90-person organization targeting acute gouty arthritis flares expects to be fully deployed by midyear, with initial revenue impact in Q3 and fuller impact in 2027.
• Rare disease segment outlook -- Management expects rare disease to account for approximately 60% of total 2026 revenues.
• ACTH market size -- Nearly $1.0 billion in sales reached in 2025; company expects the ACTH space to "increase significantly in 2026."
• Prescriber base expansion -- About half of Cortrophin Gel prescribers in 2025 were previously naïve to ACTH; this cohort keeps expanding.
• ILUVIEN market access -- All seven Medicare Administrative Contractors updated coverage for NIUPS, and top commercial payers have revised policies for both DME and NIUPS.
• Non-GAAP R&D expenses -- $49.5 million for the year, 18% higher, supporting rare disease and generics growth initiatives.
• Non-GAAP SG&A expenses -- $264.6 million for the year, rising 46%, mainly from sales force expansions and rare disease market investments.
• Royalty rate on Cortrophin Gel -- Management indicated a blended royalty rate "in the high 20s" percentage for 2026.

SUMMARY

ANI Pharmaceuticals (NASDAQ:ANIP) reported record annual revenue and profitability growth driven by rare disease and generics performance. Management forecasted continued double-digit top- and bottom-line growth for 2026, highlighting a strategic transition toward rare disease focus and outlining near-term catalysts, including a new sales organization for Cortrophin Gel in acute gout. The guidance accounts for seasonal first-quarter revenue softness, driven by insurance reverification delays, but volume acceleration has already been observed in February. Rare disease is set to comprise the majority of revenue mix, reflecting further expansion in underpenetrated specialty indications and ongoing market share gains from new ACTH prescribers. The company reiterated a disciplined capital allocation strategy and committed to further generics launches to fund rare disease growth opportunities.

• Management stated, "We currently anticipate the blended royalty rate to be in the high 20s in 2026," providing clarity regarding anticipated gross margin headwinds.
• Quarterly revenue distribution is expected to be weighted to the back half of 2026, with the fourth quarter contributing the largest share due to the acute gout sales force ramp up.
• Full impact of the new sales organization is anticipated in 2027, while initial third and fourth quarter revenue contributions from this expansion are already included in guidance.
• Prescriber expansion beyond specialty channels remains central to management's growth plan, targeting 7,000 high-volume health care providers identified for acute gouty arthritis flares.
• Continued investment in evidence generation includes a Phase 4 study in acute gouty arthritis flares with results expected after sales force launch.
• ILUVIEN growth is guided in the low double-digit range, but management does not factor in significant recovery of foundation copay assistance for Medicare, reflecting ongoing access challenges.

INDUSTRY GLOSSARY

• ACTH: Adrenocorticotropic hormone therapies; class of drugs that stimulate the adrenal cortex.
• DME: Diabetic macular edema; a complication of diabetes affecting vision.
• NIUPS: Non-infectious uveitis affecting the posterior segment; chronic inflammatory eye condition.
• MAC: Medicare Administrative Contractor; third-party entities administering Medicare claims and coverage.
• SG&A: Selling, general, and administrative expenses; includes all indirect costs not involved in product creation.

Full Conference Call Transcript

Nikhil Lalwani, President and Chief Executive Officer, Stephen Carey, Senior Vice President and Chief Financial Officer, and Christopher Mutz, Senior Vice President and Head of ANI's Rare Disease business. You can also access the webcast of this call through the Investors section of the ANI Pharmaceuticals, Inc. website at anipharmaceuticals.com. This call is accompanied by a slide deck that can be accessed by going to the Events of the Investors page of our website. You can turn to our forward-looking statements on Slide 2.

Before we begin, I would like to remind everyone that any statements made on today's conference call that express a belief, expectation, projection, forecast, anticipation, or intent regarding future events and the company's future performance may be considered forward-looking statements as defined by the Private Securities Litigation Reform Act. These forward-looking statements are based on information available to ANI Pharmaceuticals, Inc. management as of today and involve risks and uncertainties, including those noted in our press release issued this morning and our filings with the SEC. Such forward-looking statements are not guarantees of future performance. Actual results may differ materially from those projected in the forward-looking statements.

ANI Pharmaceuticals, Inc. specifically disclaims any intent or obligation to update these forward-looking statements except as required by law. During this call, we will also refer to certain non-GAAP financial measures. These non-GAAP financial measures should not be considered as an alternative to financial measures required by GAAP. The non-GAAP financial measures referenced on this call are reconciled to the most directly comparable GAAP financial measures in a table available on the slide deck accompanying this call. The archived webcast will be available for 30 days on our website, anipharmaceuticals.com. For the benefit of those who may be listening to the replay or archived webcast, this call was held and reported on February 27, 2026.

Since then, ANI Pharmaceuticals, Inc. may have made announcements related to the topics discussed, so please reference the company's most recent press releases and SEC filings. And with that, I will turn the call over to Nikhil Lalwani.

Nikhil Lalwani: Thank you, Courtney. Good morning, everyone, and thank you for joining us. 2025 was another year of outstanding execution and growth by the ANI Pharmaceuticals, Inc. team, highlighted by our remarkable results in the fourth quarter. At the core of everything we do is our purpose of serving patients, improving lives. With our progress in the last year, we are well positioned to continue delivering on that purpose in 2026 and beyond.

Starting with Slide 4, in 2025, the company delivered record revenue, adjusted non-GAAP EBITDA, and adjusted non-GAAP diluted EPS, driven by strong performance across our rare disease and, for the full year, we grew total company revenues by 44% year over year and adjusted non-GAAP EBITDA by 47% year over year. In addition, we delivered exceptional growth for our lead rare disease asset, Cortrophin, with full year revenues up 76% year over year as we meaningfully expanded our reach in underpenetrated specialty indications and served more patients. With our strong R&D and operational capabilities, our generics business continued to outperform, growing 28% year over year in 2025. Turning to Slide 5.

We believe the momentum we generated in 2025 positions us for continued growth in 2026. Our priorities for this year are threefold. First and foremost, ANI's transformation into a leading rare disease company. For our lead asset, Cortrophin Gel, we plan to maximize its multiyear growth opportunity by addressing the significant unmet need across indications. We will continue to build on our momentum in the key underpenetrated specialty indications in nephrology, neurology, rheumatology, ophthalmology, and pulmonology. In addition, we are building and deploying a 90-person organization dedicated to acute to capture sizable and unique additional opportunity in gout through expanding awareness and adoption of Cortrophin for appropriate patients by newly identified physicians in proprietary and primary care.

For ILUVIEN, we are focused on returning the product to growth by leveraging the commercial and patient access initiatives established in 2025. Importantly, we continue to believe in the long-term potential of as we believe the addressable patient populations across DME and NIUPS are at least 10x the current number of patients treated with ILUVIEN today. Our second ZIT execution in our generics business by leveraging our superior R&D capabilities, operational execution, U.S.-based manufacturing, and business development expertise, as well as maintaining our current cadence of 10 to 15.

We continue to make progress on this priority and anticipate another year of strong performance and cash generation from our generics business that will enable us to further invest in our rare disease business. Our third priority is executing a disciplined capital allocation strategy. We are focused on driving organic growth by investing in our dedicated organization for Cortrophin in acute gouty arthritis flares and investing a high single digit percentage of generic revenue into generics R&D, and to drive inorganic growth by exploring opportunities to expand the scope and scale of our rare disease business. Turning to Slide 6, we believe the three 2026 strategic priorities will drive long-term growth and value creation for the company.

In 2026, we expect to deliver over $1.0 billion in revenue, representing 23% growth over 2025 at the midpoint of our guidance range. Rare disease is expected to account for approximately 60% of our total revenues in 2026 with Cortrophin Gel growing 60% year over year. We also expect to expand the bottom line with adjusted EBITDA forecasted to grow 23% year over year at the midpoint of our guidance range. Later in the call, Steve will provide more detail on our 2026 guidance. In summary, 2025 was a pivotal year for ANI Pharmaceuticals, Inc. as we delivered record performance and drove significant growth across the business lines.

We are entering the year from a position of strength and are focused on executing on our three strategic priorities. We anticipate that our virtuous cycle of growth, in which our generics and brands businesses support our rare disease business, will drive our transformation into a leading rare disease company. I will now turn the call over to Christopher Mutz to discuss our rare disease business in more detail. Chris? Thank you, Nikhil, and good morning, everyone. Starting with Slide 7.

Christopher Mutz: Looking at 2025, I am proud of our team as we closed out the year strong, delivering another excellent quarter marked by significant growth for Cortrophin Gel as we expanded our reach in underpenetrated special indications. During the fourth quarter, the number of cases initiated and new patient starts reached another record high, and we saw broad growth across all of our targeted specialties: rheumatology, nephrology, neurology, pulmonology, and ophthalmology. Prescribing for Cortrophin Gel in acute gouty arthritis flares remained a key growth driver this quarter. This indication, unique to Cortrophin Gel among ACTH therapies, represented approximately 15% of total utilization.

Notably, gouty arthritis has also been a strong catalyst for new prescriber additions, including many providers who were previously unfamiliar with ACTH. We also continue to realize meaningful revenue synergies in ophthalmology, with fourth quarter Cortrophin Gel volumes in ophthalmology over two times that of the same period a year ago. Ophthalmology remains a fast-growing targeted specialty for Cortrophin Gel, and we believe there is further upside as we expand awareness of Cortrophin Gel for patients with severe allergic and inflammatory eye conditions. Turning to Slide 8. Looking at the market more broadly, the ACTH space has returned to growth following the launch of Cortrophin Gel in 2022 and approached $1.0 billion in sales in 2025.

We expect it to increase significantly in 2026 with Cortrophin Gel growing by 55% to 65%. Turning to Slide 9. We continue to believe that the addressable patient populations across our key indications are significantly underpenetrated. For example, roughly 10 million patients in the U.S. have gouty arthritis. About 36% receive treatment annually. They have 1.5 to 2 flares on average per year, and about 8% of those patients with severe gouty arthritis need injectable treatment for their flares. This group of 285,000 patients represents our addressable patient population. Importantly, prescribers who were previously naive to ACTH represent approximately half of our total Cortrophin Gel prescriber base, and this cohort continues to expand.

We believe the most significant opportunity for growth is through overall expansion of the ACTH market by addressing unmet needs of appropriate patients. To capture the multiyear growth potential of Cortrophin Gel, we continue to focus on three key strategic priorities outlined on Slide 10. We are investing in high-ROI commercial initiatives. Building on the commercial expansion we executed in 2025, we are now taking the next step to capture the unique opportunity for Cortrophin Gel in acute gouty arthritis flares with our new 90-person dedicated organization. There are several reasons why we are confident about the opportunity in 285,000 patients. Second, Cortrophin Gel is the only approved ACTH therapy for acute gouty arthritis flares.

And third, we have a proven track record in this indication, with prescribing for acute representing 15% of Cortrophin Gel use in 2025. In addition, we ran successful pilots across 10 territories in primary care and podiatry. This gave us further confidence to expand our organization to capture the opportunity in acute. The hiring process is underway, and we expect to deploy this team by midyear. While we anticipate the expansion to impact Cortrophin Gel volumes in 2026, we expect a greater impact in 2027 as the team reaches full productivity. Additionally, we continue to focus on enhancing patient convenience.

Our Cortrophin Gel prefilled syringe offering, which we launched in April, simplifies administration and provides a more convenient option for patients. The launch of the prefilled syringe has been well received by both patients and prescribers and continues to support broader adoption and serve as an important growth driver for Cortrophin Gel. Finally, we continue to invest in generating robust clinical evidence to support physician decision-making and confidence in Cortrophin Gel. As part of this effort, we are advancing a 150-patient Phase 4 study in acute gouty arthritis flares.

This trial, along with ongoing collection of preclinical and real-world data across core indications, is designed to reinforce Cortrophin Gel’s differentiated nonsteroidal mechanism of action and provide insights that may support adoption and treatment guidelines. We also continue to generate robust preclinical data for our key stakeholders on Cortrophin Gel's differentiated mechanism of action across multiple disease states. This remains a critical growth initiative, as expanding the body of evidence supporting Cortrophin Gel's use across indications helps physicians make more informed treatment decisions. On Slide 11, turning to our retina franchise. We are continuing to advance several initiatives to support ILUVIEN sales.

Our fully onboarded commercial team is focused on educating and engaging the retina community, and we are ramping up peer-to-peer educational programs and field activities with updated marketing materials to enhance physician understanding of ILUVIEN and its two indications. In June, we began promoting ILUVIEN under the combined label for chronic NIUPS and DME. Our sales teams have been educating customers nationwide, while our market access team worked with payers to establish coverage for the new chronic NIUPS indication. All seven Medicare Administrative Contractors, or MACs, have now updated their policies to cover ILUVIEN for NIUPS. Among the top 20 commercial payers, all those with ILUVIEN-specific policies have updated them to reflect both DME and NIUPS indications.

We also implemented initiatives to help physician practices navigate ongoing Medicare market access challenges that have persisted since January 2025. As a reminder, patient support foundations such as Good Days had limited funding in 2025, affecting their ability to assist Medicare patients with co-pay support across retina products. Our team has gained traction with leading retina practices, helping them explore pathways to secure ILUVIEN for eligible patients under the Medicare Part D benefit using a specialty pharmacy, the same approach used for Cortrophin Gel access.

In addition, we continue to share results from our New Day study of ILUVIEN in patients with DME, which were presented at prominent medical meetings including, most recently, at the FLO Retina International Congress in December and the Hawaiian Eye and Retina Conference in January. With that, I will turn the call over to Stephen Carey for the financial update. Steve?

Stephen Carey: Thanks, Chris, and good morning to everyone on the call. I will review our fourth quarter and full year 2025 results and 2026 guidance in more detail. In 2025, we delivered on our financial commitments, generating robust top- and bottom-line growth and significant cash flows. Starting on Slide 12, ANI Pharmaceuticals, Inc. recorded revenues of $247.1 million in the fourth quarter, up 30% over the prior year period. For the full year 2025, ANI Pharmaceuticals, Inc. generated record revenues of $883.4 million, up 44% versus 2024. Revenues from Cortrophin Gel in the fourth quarter were a record $111.4 million, up 88% from the prior year period.

In 2025, Cortrophin Gel delivered $347.8 million of net revenue, up 76% year over year, driven by strong adoption across neurology, nephrology, rheumatology, pulmonology, and ophthalmology. ILUVIEN net revenues were $19.8 million in the fourth quarter and $74.9 million for the full year 2025. Revenues for generics in the fourth quarter were $100.8 million, an increase of 28% over the prior year. The outperformance for the quarter was driven by continued strength in the partnered generic launch that occurred in 2025. Full year revenues in 2025 for generics were $384.1 million, an increase of 28% over the prior year, reflecting our strong R&D capabilities, execution, and steady cadence of new product launches. Now moving down the P&L on Slide 13.

As a reminder, when I speak to our operating expenses, I will be referring to our non-GAAP expenses, which are detailed in Table 3 in our press release. Generally, our non-GAAP operating expenses exclude depreciation and amortization, stock-based compensation, and certain costs related to litigation and M&A activity expenditures. Please refer to Table 3 for a full reconciliation to our GAAP. Non-GAAP cost of sales increased 43% to $99.8 million in the fourth quarter compared to the prior year period, primarily due to net growth in sales volumes and significant growth of royalty-bearing products.

Non-GAAP gross margin in the fourth quarter was 59%, a decrease of approximately 400 basis points from the prior year period, principally due to product mix, including significant growth of royalty-bearing products, including Cortrophin and a partner generic product that was launched in the third quarter, as well as lower brand revenues. For the full year 2025, non-GAAP cost of sales increased 44% to $339.5 million compared to the year before, and non-GAAP gross margin was 61.6%, down approximately 10 basis points from the prior year. Non-GAAP research and development expenses were $11.7 million in the fourth quarter, a decrease of 27% from the prior year period, driven by timing of rare disease and generic programs.

For the full year 2025, non-GAAP research and development expenses increased 18% to $49.5 million compared to the year before due to higher investment to support future growth of our rare disease and generics businesses. Non-GAAP selling, general, and administrative expenses increased 28% to $70.2 million in the fourth quarter, driven by spend for our new, larger ophthalmology sales team promoting Cortrophin Gel and ILUVIEN and continued investment in rare disease sales and marketing activities, including the expansion of the rare disease team in 2025. For the full year 2025, non-GAAP selling, general, and administrative expenses increased 46% to $264.6 million.

Adjusted non-GAAP diluted earnings per share was $2.33 for the fourth quarter, compared to $1.63 per share in the prior year period. For the full year 2025, non-GAAP diluted earnings per share was $7.89 compared to $5.20 the year before. Adjusted non-GAAP EBITDA for the fourth quarter was $65.4 million, up 31% compared to the prior year period, and was $229.8 million for the full year, up 47% compared to the prior year. We ended the fourth quarter with $285.6 million in unrestricted cash, up $140.7 million as compared to $144.9 million as of December 31 of the prior year.

Cash flow from operations was $30.4 million in the fourth quarter of this year, and $185.2 million on a full year basis. As of 12/31/2025, we had $629.1 million in principal value of outstanding debt inclusive of our senior convertible notes and term loan. At the end of the fourth quarter, our gross leverage was 2.7 times and our net leverage was 1.5 times our full year adjusted non-GAAP EBITDA of $229.8 million. This morning, we are pleased to reaffirm our 2026 financial guidance which reflects significant top- and bottom-line growth. Our guidance outlined on Slide 14 is as follows. 2026 net revenue, $1.055 billion to $1.115 billion, representing year-over-year growth of approximately 19% to 26%.

Cortrophin Gel net revenue of $540 million to $575 million, representing year-over-year growth of 55% to 65%, driven by continued volume gains. Consistent with prior years and typical industry dynamics, we expect first quarter Cortrophin Gel revenues to be down sequentially from the fourth quarter and to represent approximately 13% to 14% of total 2026 revenues, slightly lower than in 2025 when the first quarter accounted for approximately 15% of full year revenues. This effect is driven by two factors.

First, we are experiencing typical seasonality related to the impact of insurance reverifications, which appear to be taking slightly longer as compared to the prior year due to increased Cortrophin patient volume in the physician's offices and, in some parts of the country, due to weather-related physician office closures that temporarily delayed the reverification process. While these factors impacted January, we have since seen a 25% jump in volumes dispensed and acceleration in new patient starts in February, and are confident that the momentum will persist in March as physician offices complete work through the reverifications backlog.

Second, our full year Cortrophin guidance is inclusive of initial script volume expected to result from our 90-person organizational expansion to support our gouty arthritis flares indication. Revenues associated with this expansion will first occur in the third quarter and are expected to build momentum throughout the fourth quarter. As we look farther out into the year, we remain confident in our full year guidance and the significant multiyear growth opportunity for Cortrophin Gel. We expect very significant sequential growth in the second quarter as typical first quarter.

We then expect further sequential gains in the third and fourth quarters driven by continued performance of our portfolio, pulmonology, and ophthalmology teams, in addition to the full deployment by the end of the second quarter of our new 90-person organization focused on acute gouty arthritis flares. We expect ILUVIEN net revenue of $78 million to $83 million, representing year-over-year growth of approximately 4% to 11%. We expect adjusted non-GAAP EBITDA of $275 million to $290 million, representing year-over-year growth of approximately 20% to 26%.

And from a quarterly cadence perspective, we expect adjusted non-GAAP EBITDA to be down sequentially in the first quarter and modestly down as compared to the first quarter of prior year driven by quarterly revenue dynamics. We then expect sequential growth in the remaining quarters of the year, with the fourth quarter representing the highest quarter by a significant amount, driven by incremental contribution from our gout-focused team expansion. We expect adjusted non-GAAP earnings per share between $8.83 and $9.34, representing year-over-year growth of approximately 12% to 18%.

We expect adjusted gross margin to be 59.3% to 60.3% in 2026, which is down from 2025, driven by significantly higher forecast sales of royalty-bearing products, the non-recurrence of revenues from our first half 2025 180-day exclusive launch of frucalypse, and the expectation of lower brand sales. We currently anticipate a full year U.S. GAAP effective tax rate of approximately 26% to 28%, and, consistent with prior quarters, we will tax effect our non-GAAP adjustments for computation of adjusted non-GAAP diluted earnings per share utilizing our estimated statutory rate of 26%. We anticipate between 21.5 million and 21.8 million shares outstanding for the purpose of calculating full year non-GAAP diluted EPS.

And finally, please note that we will continue to exclude from our non-GAAP diluted EPS calculation the diluted shares included in GAAP diluted EPS which are expected to be offset in full by the capped call transaction. With that, I will turn the call back to Nikhil.

Nikhil Lalwani: Thank you, Steve. Turning to Slide 15. In closing, we delivered a remarkable 2025 characterized by significant growth across Cortrophin Gel and outperformance in our generics business. We have entered 2026 in a position of strength and remain focused on achieving our strategic priorities, including accelerating our transformation into rare disease, continuing to execute in generics, and deploying capital in a disciplined manner. Overall, we expect to deliver over $1.0 billion in revenue in 2026, with rare disease representing approximately 60% of total revenues. With that, operator, please open the line for questions.

Operator: Certainly. Thank you. We will now open for questions. We will take our first question from the line of Glen Santangelo from Barclays. Please go ahead.

Glen Santangelo: Thanks for taking my question. Good morning, everyone. Hey, Nikhil, obviously, Cortrophin continues to surprise on the upside, and you sort of make the case that you believe there is a multiyear opportunity here as you expand into these underpenetrated indications, and you know, you are obviously investing in the sales force to try to take advantage of that. Without giving us guidance beyond 2026, I do not know if there is any high-level commentary you can sort of give us to help us think about how meaningful this multiyear opportunity could be? And I am guessing, you know, you started to think about a peak sales number, maybe it is a little bit premature.

But how do you think about that? And then my follow-up for Steven is going to be, you know, the royalty steps up this year. Can you help us think about how that royalty is going to step up so we can sort of better model gross margins going forward? Thank you.

Nikhil Lalwani: Good morning and thank you for your question, Glen. Look, I think we believe in the significant multiyear growth opportunity for Cortrophin, and I think the key really is Slide 9 in our deck from this morning, where we highlight the addressable patient populations across indications. And these are significantly underpenetrated, not just by us, but across the ACTH category. So we believe that there is a much larger number of patients that are appropriate for ACTH therapy that are yet to benefit from this therapy. So we see a significant multiyear growth runway for the category, also for Cortrophin, and we are investing to build momentum in 2026 and beyond. Right?

So high-ROI commercial initiatives like the 90-person organizational expansion for gout, right? We did an expansion last year. Enhancing convenience. We launched a prefilled syringe last year. We are continuing to evaluate opportunities to further enhance patient convenience. And, importantly, we are generating both scientific and clinical evidence. We have advanced our Phase 4 clinical trial. We are advancing our Phase 4 clinical trial for Cortrophin in gout states, as well as a robust pipeline of investigator-initiated trials across disease. We believe in the strong multiyear growth opportunity and are investing to ensure that we can capture that opportunity, and we again believe in the opportunity for the category as a whole to keep growing for several years.

And then your second question, on the Merck royalty. In 2025, annual revenues of Cortrophin Gel reached a level by which we surpassed the highest royalty tier for incremental net sales. So we, in 2025 itself, were in the highest royalty tier for the royalty. We currently anticipate the blended royalty rate to be in the high 20s in 2026. Thank you, Glen.

Operator: Thank you. We will take our next question from David Amsellem with Piper Sandler. Please go ahead.

David Amsellem: Thanks. So I had two on Cortrophin. So one, I am trying to get a better sense of how you are thinking about operating leverage going forward. So you are adding the 90 reps. You are calling on primary care. You are calling on podiatrists. I am just wondering how promotion intensive you perceive the gout indication be and what that means for potentially further expansion. So just help us understand that and how you are thinking about operating leverage. That is number one. And then number two is, you are thinking about indications like sarcoidosis and ophthalmic indications, can you talk about the number of vials used or duration of treatment in those kind of indications versus gout.

And what I am trying to get at is the value of a given patient across the different opportunities within the Cortrophin franchise. So if you could help us provide color there, that would also be helpful. Thank you.

Nikhil Lalwani: Great. Good morning, and thank you for your question, David. So the first question on operating leverage. Look, we are still in high growth mode, and we continue to balance growth and profitability as we drive that growth. Right? So when you look at 2025, our guidance implies EBITDA growth of 20% to 26%. And the EBITDA margin as a percentage has stayed the same in our 2026 versus 2025, despite a year of very significant investment in this 90-person organization for gout, and then also related OpEx, right?

So the total implied OpEx increase at the midpoint of our guidance is about $50 million, majority of which is for the gout expansion, and despite that, we are keeping the EBITDA margin percentage same in 2026 versus 2025. We strongly believe that, as we had seen even with the expansion last year of the sales force, you will see partial impact from the organization expansion for gout in 2026, and we will see full impact in 2027. Right? So the full year impact, because it takes the sales force—we will have them in place by midyear. They will have impact in Q3 and Q4, and then you will see full impact in 2027, obviously, operating leverage.

So that is the question on operating leverage. And look, I think the key is in terms of further expansions, the key is the addressable patient population. Right? As you know, we currently have a combined team that details into nephrology, neurology, and rheumatology. We expanded—that is called our portfolio team—expanded that team in 2025. Right? We still have a much larger addressable patient population that we can address, not just in these three therapeutic areas, but across areas. So with an ability to reach physicians and reach patients, there would be benefit from further expansions, obviously, but that is down the field as we capture this multiyear growth opportunity.

I mean the key in terms of the current year investment. We are seeing impact in this year, retaining the EBITDA margin percentage, and then going forward in 2027, we will see a much bigger impact with same level of SG&A as of this year. Your second question was on the duration of treatment across indications. The duration of treatment does indeed vary. Sarcoidosis has a much longer use and more vials per patient, whereas acute gouty arthritis flares has a lower number of vials per patient. That is appropriate, right, at the time of the exacerbation or flare. So there is a variance across the variations that we serve with Cortrophin Gel. Thank you, David.

Operator: Thank you. We will go next to Vamil Divan from Guggenheim Securities. Please go ahead.

Vamil Divan: Great. Thanks for taking my questions. Maybe one more on Cortrophin, if I could, sort of building on the earlier question. So additional 90-person organization you are seeing is dedicated to the gouty opportunity. In targeting mainly primary care and podiatry, I am just trying to get a sense of, again, sort of the leverage of the opportunity for them to do other things beyond just gouty arthritis. Can—will they be going to any other specialties? Or are there other indications they will be focusing on? Or is it strictly just for gouty arthritis? Just trying to get something into the ability to leverage that additional investment. And then second question is more for Steve on the business development side.

You have talked about it through opportunities here. I am just trying to get a sense of, given where your leverage is now, what you are willing to do in terms of leverage versus using equity, or as you think about the size of potential deals? What are you thinking about in terms of options for financing those sorts of opportunities? Thanks.

Nikhil Lalwani: Good morning and thank you, Vamil. So on the 90-person organization, that is for gout, and as a clarification, you know, not all 90 are in sales. So majority of that 90-person group is sales expansion, but there are obviously patient support operations and marketing and other support areas too. But yes, that organization—and sales organization and the rest of the organization—can be leveraged both for other indications that they treat. So primary care and podiatry do treat other indications that Cortrophin is indicated for. Our focus is primarily on gout. But there are other indications potentially that they can treat, which, of course, are for the appropriate patients that can be leveraged for that.

But, in addition, you know, that sales force can also be leveraged by adding another product in the basket, just like we did for ophthalmology. So that option is available. Obviously, the opportunity in acute gouty arthritis flares is very significant. We have identified 7,000 HCPs that treat the most severe acute gouty arthritis flares patients, and that is the primary focus of this expansion, and that is what we will be focused on as we put this team in place by midyear. And look, we have made very good progress on the recruitment. We have our sales leadership and the area business directors in place, and we are now moving to recruitment of the sales team members.

We will launch by midyear. So on the—and our reasons to believe are number one, the large underpenetrated market opportunity and Cortrophin is the only approved ACTH product with this indication. Second is we have a successful track record in gout. Ten percent plus of our volumes in 2025 coming from gout in rheumatology and nephrology. And number three, our successful pilot programs across 10 plus territories in primary care and podiatry offices, which we ran in 2025, right, would see the most severe acute gouty arthritis flares patients.

And so we saw success with those pilot programs, and that gave us the confidence to deploy this larger sales force and the larger organization in an indication where we have the indication and we are the only ACTH product available. Right? So with the field force deploying by midyear, we expect to see impact in Q3 and Q4, like we saw in 2025 when we did the expansion for our portfolio sales force, and then we will see the full realization in 2027. Right? As we are expanding our field force, we are also investing in clinical evidence generation through a Phase 4 trial to expand usage over time. So that is on the gout expansion.

And then your second question on the Merck royalty. Look, I think we are always evaluating potential opportunities, but we do not comment on active or non-active business development initiatives, especially with our partners. And thank you for your question, Vamil.

Operator: Thank you. We will move next to Ekaterina Knyazkova. Please go ahead.

Ekaterina Knyazkova: Thank you so much. Just one for me. So just on Cortrophin Gel, have you seen any recent changes on the patient access front? Just are you seeing any payers or plans giving more trouble or coverage or reimbursement? Or are you seeing kind of trends that are similar as you were seeing last year?

Nikhil Lalwani: Good morning, and thank you for your question, Ekaterina. Look, we try to find a balance between sharing information that is helpful to investors and that is competitively sensitive. Having said that, at an overall level, we have not seen material shifts from an access perspective. Again, we are targeting or we are reaching, trying to reach, the appropriate patients as a late-line therapy with Cortrophin Gel. So thank you for your question, Ekaterina.

Operator: We will go next to Thomas Smith with Leerink Partners. Please go ahead.

Thomas Smith: Hey guys, good morning. Two on Cortrophin, if I could. You mentioned that about 15% of utilization came from acute gouty arthritis in 2025. Could you just give us a sense of what your expectations are for where that number goes in 2026 and 2027 given the sales force expansion efforts? And then, could you give a little bit more color on the Cortrophin pilot programs executed in primary care and podiatry? Any details, I guess, on specific feedback from those prescribers versus your other specialty types? And any specific learnings you are implementing to help better target those offices? Thanks so much.

Nikhil Lalwani: Yes. Good morning, and welcome to your first ANI Pharmaceuticals, Inc. conference call. Tom, great to have you. So the first question is on our current business. In gout, about 15% of our volumes comes from gout. As we deploy this targeted sales force and broader organization, we do expect it to increase significantly. We are not putting a number to it at this time. We will keep you updated, obviously, on our progress. I think the important thing to highlight here is that if you look at the ANI Cortrophin story, a big part of that success has been being able to reach new physicians.

Almost half of our physicians that have prescribed Cortrophin were naive to the category—naive to ACTH—prior to the entry of Cortrophin Gel. And if you think about—and this dovetails into your second question around the pilot programs—if you think about the HCPs that we are reaching through this expansion, you know, we are targeting, we are trying to reach, about 7,000 HCPs that we have identified across territories, right? Majority of these—right, obviously, some were part of the pilot programs that we had across 10—but most of these have not been, and so that will further expand, right?

And the success we have had in being able to reach new physicians will continue—has given us confidence—and will continue as we reach these new primary care and podiatry care physicians. Right? So what will also expand is not just the gout volumes as a percentage of Cortrophin volume, but also the number of physicians and number of new physicians that were naive to ACTH.

And then going back to your second question—regarding, I guess, second part of your second question on the pilot programs—I think that we have had a lot of learnings in terms of the discussion to be had with the primary care and podiatry physicians, in terms of identifying the appropriate patients, how to work with their offices, right, to work through the enrollment-to-fulfillment process, and then also learnings on—you know, primary care and podiatrists are a very large sort of number of HCPs that are there in the country—really figuring out the 7,000 that treat the most severe acute.

How do you identify them with the claims and other data that is available, so that you are reaching the appropriate patients? That has been part of our learnings through the pilot programs through 2025. And thank you for your question, Tom.

Operator: We will take our next question from Leszek Sulewski from Truist Securities. Please go ahead.

Leszek Sulewski: Good morning. Thank you for taking my questions. Congrats on the progress. Three from me on Cortrophin first. Noted that 15% of utilization is coming from gout. How would you expect that trend to uptick once the new team is in place? And is this a good representation—the percentage of the total Cortrophin revenues? And then will you have the results in Phase 4 trial in time for the sales force expansion? And second, on ILUVIEN, can you provide an update on the specialty pharmacy progress and perhaps just kind of your thoughts on the patient access? And then lastly, on generics, how are you thinking about product cadence and erosion as we move through the year? Thank you.

Nikhil Lalwani: Yes. Good morning, and thank you for your questions, Les. I will take them one by one. So the first question on the gout, 15% of volume—of current volumes—will expand, right, as a percentage of total volumes with this investment. So we will see a significant uptick. We will update you as we move along. On the trial, the Phase 4 is progressing, and we will provide meaningful updates as that trial progresses. The organization expansion—right—we have already hired, as I said, the sales leadership and the ABDs, area business directors. The organization will launch in full by midyear. The results of the trial will not be in place by then.

So that is on—they will come later on, and we will obviously provide updates on the trial. The second question was on ILUVIEN. So on ILUVIEN, we continue to make progress in the growing use of the alternative access channels to navigate the market access challenges for Medicare patients. We are seeing prominent practices adopting this alternate workflow and use of alternate channels, and, you know, it is basically patients that have access to the drug benefit, and that is the same procedure or process that we use and workflow that we use for Cortrophin. So we have seen prominent retinal practices use it.

Now what has happened with the foundation funding is we had seen some early contributions to the funding earlier this year, and though this has not had a meaningful impact on patient access to ILUVIEN, it was open for a few days and then it was closed back.

So our guidance 2026 does not assume that the funding will return in any meaningful way, and we will continue to closely monitor the situation and, of course, stay focused on growing the use of the alternative access channels to navigate the market access challenges, in addition to the strategic investments in marketing and medical affairs to support the increased awareness of the New Day clinical data for DME, establishing the coverage for both DME and NIUPS, and then the strengthened commercial team and further enhanced promotional efforts. So that is on ILUVIEN. And then finally, question on the generics cadence.

We are continuing to a strong cadence from our driven by our R&D capabilities of 10 to 15 launches that will help support growth of the generics business and cash flow generation that we are into rare disease to accelerate the transformation of ANI Pharmaceuticals, Inc. into a leading rare disease company. And thank you for your questions, Les.

Leszek Sulewski: Thank you.

Operator: Thank you. We will take our next question from Brandon Folkes with H.C. Wainwright. Please go ahead.

Brandon Folkes: Hi, thanks for taking my question and congrats on the progress. Maybe just sort of following on from the line of questioning on Cortrophin. Outside of gout, is there any way you can just give us some color in terms of how you are seeing the—are prescribers choosing one product over the other? Or are prescribers using both where they can? You talked about adding new prescribers. Can you just help us think through—you convert these new prescribers, are you generally converting them to sort of be a Cortrophin prescriber or a ACTH believer and prescriber?

And I am trying to get to is how competitive is the next script for a potential ACTH patient right now versus a continued market expansion? How long do you see sort of the market expansion playing out versus market expansion as well as share capture between the two and within the category driving growth? Thank you.

Nikhil Lalwani: Yes. Good morning and thank you for your question, Brandon. So I think your first question was on the ACTH market beyond gout. And I think that we will just point to a couple of points. Number one is that we see growth across indications, across the core indications that we launched with, which is in rheumatology, nephrology, and neurology, in addition to important growth in pulmonology and ophthalmology. If you think about ANI Pharmaceuticals, Inc.'s growth in Cortrophin in 2025, you know, the 75% to 76% growth in Cortrophin, a significant portion of that came from just growth across all these specialties outside of gout.

Gout also was a driver, but there was significant growth across these other specialties too. And it really—the thing that is underpinning—and that really goes to your second question around the competitive situation. I mean, this is to us not about, you know, about share capture at all. This is about market expansion, reaching the appropriate patients. And the addressable patient population is very significant and highly underpenetrated, right? So it is significantly underpenetrated across indications. And so, you know, the fact that two players are out there trying to address ultimately supports the overall market growth and ensures that the appropriate patients can get the benefit of ACTH treatment, you know, for their indications.

And then maybe to the last part of your question, which was—no.

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