NRXP - NASDAQ

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

Thank you, Joelle, and welcome, everyone. Before we proceed with the call, I would like to remind everyone that certain statements made during this call are forward-looking statements under U.S. federal securities laws. These statements are subject to risks and uncertainties that could cause actual results to differ materially from historical experience or present expectations. Additional information concerning factors that could cause actual results to differ statements made on this call is contained in our periodic reports filed with the SEC. The forward-looking statements made during this call speak only as of the date hereof, and the company undertakes no obligation to update or revise forward-looking statements. Information presented on this call is contained in the press release issued this morning and in the company's Form 10-Q, which may be accessed from the Investors page of the NRx Pharmaceuticals, Inc. website. Joining me on the call today are Dr. Jonathan Javitt, our Founder, Chairman and CEO; and Michael Abrams, our Chief Financial Officer. We'll provide an overview of our company's progress as reported in today's 10-Q, following which Mike will give a review of the company's financials and results. Following their prepared results, we'll address investor questions. Jonathan as having a couple of technical issues this morning, so I'll start us off. Since the beginning of the third quarter, NRx has made transformative progress in developing our business. We have advanced each of our programs with drug approvals applications in process for KETAFREE, NRX-100 and NRX-101. It also expanded our NRX-101 pipeline and closed on multiple acquisition targets for a network of interventional psychiatric clinics HOPE Therapeutics. In conjunction with closing our first clinics, we now are now generating revenue and on a path to a highly promising company. The point of our call today is not 3 weeks of revenue from a single clinic just a few hundred thousand dollars that hit our third quarter income statement. Rather, it's the revolutionary and generational shift that we see in the treatment of severe depression and PTSD today, along with the potential to use the same technologies to treat traumatic brain injury, autism spectrum disorder, Parkinson's and even cognitive decline in coming years. This past quarter has been a watershed moment in that generational shift from our perspective. Lastly, a group of highly respected scientists presented real-world data showing an 87% treatment response and 72% remission from severe depression following a single day of treatment with a newly developed TMS for transcranial magnetic stimulation and a low dose of D-cycloserine or DCS. Note that the active ingredient in NRX-101 is also DCS. This allocation comes on the heels of a well-controlled clinical trial in which DCS was shown to more than double the effect of conventional TMS in treating both depression and suicidality. Rather than rely on this call, we urge you to read the underlying science, referenced on our website on the Publications page. As we announced last week, our company HOPE Therapeutics is the first one to deploy this ONE-D protocol in Florida in partnership with Ampa Health and we're actively partnering with its established clinics and seeking to open new clinics in Florida and nationwide. The scientists involved in that trial will be the first to say that there is not the only TMS machine capable of affecting a 1-day Theta-burst protocol. However, no drug other than DCS so far has demonstrated the augmentation of TMS in the literature. Accordingly, this quarter's results should be viewed as seeing the first green shoots come out of the ground, not as an indication of whether these shoots will ultimately be a bush or a giant tree. We anticipate that our growing enterprise will be far easier to discern by our next conference call. As you know, we have been working with DCS since our founding in 2015, and our Co-Founder, Dr. Daniel Javed, began research with this class of compounds in 1987. NRx holds rights to more than 70 patents around the world that relate to the use of DCS in treating depression, PTSD and other life-changing brain disorders. We have extensive experience in the formulation and stabilization of this highly challenging and unstable molecule. A breakthrough therapy designation IND opened with the FDA and manufactured drug in our warehouse that is actively being deployed in an expanded access protocol to enable doctors to replicate last week's dramatic ONE-D findings. Although a raft of compounding pharmacies are offering DCS for sale in response to these dramatic scientific results, we will be releasing chromatography and other foundational science demonstrating the need for manufacturing controls that are essential for preventing rapid degradation of DCS and the formation of various impurities, controls and techniques. We have devised over nearly 10 years of active preclinical and clinical development. The reason to be excited about combining DCS, which is a highly neuroplastic drug along with TMS, which is also a neuroplastic therapy, is not the simple notion that 2 neuroplastic treatments may be better than 1 as in one plus one equals to two. Rather, the scientific legacy of leaders in the field increasingly proves the drugs such as DCS, make the brain cells far more receptive to TMS and other neuroplastic therapies, akin to fertilize in the field as you plant the seeds. For those who are new to this conversation, neuroplasticity is the process by which brain cells are constantly growing new connections to other brain cells. In a digital computer, transitors are always turning on and off under the control of software but the circuits stay the same. In the brain, those transistors are neurons, polarized and depolarizes, the cellular equivalent turning on and off, but also constantly form new connections and prune those connections to other cells. That's called neuroplasticity. Over the past 20 years, we have come to understand that the loss of neuroplasticity in different parts of the brain is at the root of depression, PTSD, autism spectrum disorder and other conditions that I've mentioned. And Dr. Javitt's 45 year medical and scientific career, predominantly focused on the visual access of the brain, the last time he was involved in technological change that this profound was introduction of the first anti-VEGF drug to treat macular degeneration that led to a whole generation of injectable eye drugs that forever changed the potential for people to preserve their site in the face of previously hopeless and blinding conditions. In our view, we are witnessing a similar tectonic split shift in the neuroplastic drugs, devices and digital therapeutics are being combined to transform the treatment of severe depression of PTSD today and the brain diseases that affect more than a billion people on the planet tomorrow. The dose publishing this science are correct, it is likely that oral antidepressant drugs with their life-threatening complications, their effects on disfiguring weight gain and sexual dysfunction, their propensity to cause suicidal ideation and their dismal 30% success rate may lose their places first-line treatment for those with life-threatening brain diseases. More importantly, this generational shift in our understanding will finally cause us to abandon the notion of brain diseases that result in behavioral symptoms such as discretion and anxiety are biologically different for brain diseases that cause Parkinson's or cognitive dysfunction and that the patients who suffered these supposedly behavioral health problems are somehow less deserving of medical care than those who suffer from other neurological or CNS diseases. One reason we founded HOPE Therapeutics was to have the ability to directly engage the payer community in this changing paradigm. That brings us to corporate and financial results achieved in the past quarter and the objectives we think are meaningful over the coming quarters. Our quarterly report reflects only the first 3 weeks of revenue from our first 2 clinics. By year-end, we anticipate growing from 2 clinics to 6 or more clinics within our current orbit, and we expect these revenues to demonstrate strong growth over the coming quarters as we integrate the clinics, help grow them and add to their numbers. Most importantly, the historic revenue is based on ketamine treatment sessions and traditional TMS treatment sessions that are generally reimbursed at less than $500 a session. Much of our future growth is likely to be focused on day and shrug shorter short-term multi-modality treatments with rapid clinical results that are already reimbursed by payers at higher levels. To give you just one of many real-life illustrations of why this is economically viable, considering the situation of a highly trained essential first responder, who is suffering from depression and PTSD. In many cases, antidepressants are incompatible with a return to duty. For many frontline roles, this is a disqualification. Hence, the desire of the patient and the family for relief from a debilitating and life-threatening new addition aligns with the urgent need of military, law enforcement, emergency services and other organizations to maintain their force readiness. The financial and other resources -- financial and other resource costs of replacing frontline personnel is astronomical. While medical insurance decisions are often made by the executives who many Americans view as not caring enough about the individual, health insurance payment policies are increasingly dictated by the employers who pay the premiums and who care deeply about their ability to maintain a workforce in whom they have invested. Often the decision makers at that level are the military leaders, police and fire commissioners and others who have come up through the ranks and we think about their people first. When Dr. Javitt presented last month at Fort Belvoir to a room containing generals, admiral and elected officials. He sat with a senior adviser to the Secretary of the Veteran Affairs Administration who reminded of the public statements from the VA that stopping veteran suicide is in their -- is their top priority. We hope to release a video of that briefing to you in the coming weeks. Our balance sheet is considerably stronger than it was at the end of the second quarter, owing in part to the support of long-term health care specialist investors who joined us during the third quarter and purchased common stock with no warrant overhang, no pricing provisions and no convertible debt feature. At this point, NRx has secured operating capital that is anticipated to be sufficient to fund drug development operations through 2026. Additionally, as just noted, we expect to continue to add revenue from the clinical operations and believe it is likely that we will see revenue from sales of ketamine under an ANDA in mid-2026. As you can see from our balance sheet, and as Mike Abrams will be discussing in greater detail later, we are well positioned to achieve numerous milestones on both sides of our business with existing cash. Our goal in doing so is to substantially enhance shareholder value while advancing our mission of bringing HOPE to life. Now let's review each program, starting with our preservative free ketamine -- which was previously required a toxic preservative, which is benzethonium chloride to maintain stability and sterility. Our stability data remains on track for a 3-year room temperature shelf life. We're pursuing 2 parallel approval processes, a generic pathway and an innovative pathway using 2 different formulations to prevent price confusion. As you saw in August, FDA ruled that those 2 formulations create 2 different drug identities. The first pathway is a new drug application or NDA for NRX-100 in suicidal ideation for patients with depression, including bipolar depression. The second is an abbreviated new drug application or ANDA to make KETAFREE available for ketamine's existing generic indications. NDA preparation is nearly complete, and we anticipate transmitting the entire submission in the coming weeks. The key development is that we are adding more than 60,000 patient encounters of real-world efficacy data, which demonstrates statistically significant advantages of intravenous ketamine over nasal S-ketamine. Combined with the data from U.S. and European trials in more than 1,000 patient participants, we believe this to be a compelling case for efficacy. This will be an important step forward for both the company and for patients suffering from suicidal depression. There's currently no medication approved for treating suicidal ideation and the SPRAVATO label clearly states that it has not been shown to be effective for reducing suicidality. The only current alternative is for patients with suicidal ideation is ECT or electroconvulsive therapy. As you know, the PCORI trial, which is posted on our website, demonstrated a 30% incidence of memory loss with ECT and none with IV ketamine. And what we feel is a strong validation the FDA granted to us and expand Fast Track designation in August to now include all patients with suicidal ideation and depression, including bipolar depression. Suicidality is a massive problem in the U.S. The fact -- in fact, the CDC estimates that nearly 13 million Americans seriously consider suicide each year, and this leads to an American dying from suicide every 11 minutes. Our leadership team was invited to Fort Belvoir last month where we presented to senior military and veterans affairs leaders and will be repeating the briefing at VA headquarters and Nellis Air Force base to the Air Force leadership. As Secretary Collins has said publicly stopping veterans suicide is his top priority. In June, the FDA created the commissioner's national priority voucher program that affords substantially faster review times of 1 to 2 months versus the standard 10- to 12-month review, enhanced communication throughout the review process and creates potential for accelerated approval of NRX-100. Commissioner Macri has publicly stated the safe and effective drugs to prevent suicide are a top priority for him. More importantly, after some publicly reported personnel changes, the FDA centers for drugs now as a leader has been long-term proponent of accelerated approval for life-saving drugs that meet an unmet medical need. To receive a CNPV, a product must meet at least one of the following criteria: address the U.S. public health crisis, address a large unmet medical need, deliver more innovative cures for the American people, reassure key strategic drugs to the U.S. or reduce health care costs. NRx meets all of these criteria. In Q3, we filed an abbreviated new drug application for ketamine with priority review requested. We call this product KETAFREE. After meeting with the FDA in August of 2025, we've refiled the ANDA following FDA notification of the suitability position for NRx's proposed strength of KETAFREE. Last week, we received a communication from FDA, noting no significant deficiencies in the revised KETAFREE filing, and we believe the filing is on track for second quarter PDUFA date or generic -- that's a generic drug equivalent of a PDUFA date. The company has additionally submitted a citizen petition seeking to have benzethonium chloride, a toxic preservative included in all currently approved ketamine products for antiquated reasons, removed from all presentations of ketamine. This preservative is the subject of a detailed toxicology report we have published, which details the concerns that led FDA to ban B

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

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

Operator, I believe we can begin to take questions.

[Operator Instructions] Your first question comes from Tom Shrader with BTIG.

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

Those are great questions. And a lot of this work, the basic science work has been done and published by Dr. Josh Brown at Harvard McLean with a number of others supporting the science. The most important thing to recognize is that DCS has to be used at a non NMDA antagonist dose. And I know this is a little more science than we sometimes do on a conference call. But in this case, it's critical. DCS is what's called a mixed agonist antagonist, unlike ketamine, unlike [indiscernible] unlike all of the NMDA drugs that blocks the NMDA channel, DCS affects a side unit of NMDA called the glycine site and at low doses, it's actually an NMDA agonist, but much more importantly, it's a highly neuroplastic drug. There's evidence that ketamine plus TMS actually decreases the effectiveness of TMS, there are even people who believe that ketamine shouldn't be used in conjunction with electroshock therapy because it may decrease the effectiveness of electroshock therapy. So all of the work that's been done is at low doses of D-cycloserine, 150, 175-milligram dose and it just happens that when we formulated NRX-101, that was one of the strengths that we made. That's why we have it in the warehouse. In fact, it was not made to be the main strength of NRX-101, it was manufactured to be a potential step-down strength in our clinical trial. So far, nobody else has identified a different neuroplastic drug that works in combination with TMS, the way D-cycloserine does. Do me a favor and repeat the second part of your question where you were asking...

Just the procedure to use your drug because it's in the works at the FDA, what would be -- how hard is it to just for somebody to get your drug if they want to add it to TMS in your clinic or anywhere else?

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

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

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

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

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

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

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

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

[Operator Instructions] Your next question comes from Ed Woo with Ascendiant Capital.

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

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

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

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

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

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