CPIX

Good afternoon, and welcome to the Cumberland Pharmaceuticals first quarter 2026 financial report and company update. This call is being recorded at the company's request and will be archived on its website for one year from today's date. I would now like to turn it over to Emily Kent from the Dalton Agency, who handles Cumberland's communications. Emily, please proceed.

Hello, everyone, and thank you for joining us today. This afternoon, Cumberland issued a press release announcing its first quarter financial results. The release also provided an overall company update, including key developments during the quarter. The release, which includes the related financial tables, can be found on the company's website at cumberlandpharma.com. During today's call, management will share an overview of those financial results and a company update, including recent developments and a discussion of Cumberland's brands, pipelines, and partners. Participating in today's call are A.J. Kazimi, Cumberland's Chief Executive Officer, Todd M. Anthony, Vice President, Organizational Development, and John M. Hamm, Chief Financial Officer. Please keep in mind that their discussions may include some forward-looking statements as defined in the Private Securities Litigation Reform Act. Those statements reflect the company's current views and expectations concerning future events and may involve risks as well as uncertainties.

There are many factors that could affect Cumberland's future results, including natural disasters, economic downturns, international conflicts, trade restrictions, public health epidemics, and others that are beyond the company's control. Those issues are described under the caption Risk Factors in Cumberland's annual report on Form 10-K and any subsequent updates filed with the SEC. Any forward-looking statements made during today's call are qualified by those risk factors. Despite the company's best efforts, actual results may differ materially from expectations, so information shared on this call should be considered current as of today only. Also, please remember that the company isn't responsible for updating any forward-looking statements, whether as a result of new information or due to future developments. During today's call, there will be references to several of Cumberland's marketed brands.

Full prescribing and safety information for each brand is included on the individual product website, and you can find links to those sites on the corporate site at www.cumberlandpharma.com. The company will also be providing some non-GAAP financial measures with respect to its performance. An explanation and reconciliation to GAAP measures can be found in the financial tables of the earnings release that I noted was issued earlier this afternoon. If you have any questions, please hold them until the end of the call, at which point we will be happy to answer them. Management is also prepared to hold a follow-up conversation with shareholders after the call if you prefer. With that introduction, I'll turn the call over to Cumberland's Chief Executive Officer, A.J. Kazimi.

Well, thank you, Emily, and good afternoon, everyone. We appreciate you joining us today. As Emily mentioned, we'll provide a review of our financial results for the first quarter of 2026. We'll discuss key developments during the period, but we'll also share recent updates. Recall that Cumberland enjoyed an outstanding year in 2025 with double-digit growth in sales, significant cash flow from operations, the addition of a new brand to our portfolio, new international product approvals, and breakthrough clinical study results. I believe those were certainly terrific findings, and I'd like to congratulate our team that was responsible for delivering that performance.

We're pleased to report continued momentum in 2026 as we're off to an excellent start with FDA approval for expanded Caldolor labeling, the initiation of our sales promotional efforts in support of Talicia, the first shipment of Vibativ to China, and FDA clearance of the manufacturing facility which will enable the relaunch of Vaprisol. We've also entered into a transformational agreement that positions Cumberland for the next phase of our company's evolution and growth. Today, I'm delighted to discuss that agreement, which we'd enter into with Apotex, the largest Canadian-based pharmaceutical company, to integrate our branded U.S. commercial businesses. Under the terms of the agreement, Apotex will acquire our portfolio of marketed products for cash consideration of $100 million, subject to our shareholders' approval.

Cumberland will also receive $9 million in payments for inventory, fees for transitional support services, and a milestone payment tied to future product sales. This transaction represents a significant event for Cumberland as it unlocks substantial near-term value for our shareholders. Moreover, our hope and our expectation is that even more patients will benefit from the array of our marketed products given Apotex's larger market presence. It's important to note that with the tax bases associated with the assets involved, combined with the tax loss carryforwards, we are estimating the income taxes resulting from the transaction will be modest. As a result, the net consideration will significantly strengthen our balance sheet. Following the close of the transaction, we intend to focus on advancing our robust pipeline of product candidates to address unmet medical needs, which, if successful, can greatly benefit patients and shareholders alike.

That strategic shift will position Cumberland as an innovation-driven organization, developing new medicines for the future. We believe this transaction is very beneficial on several fronts. It unlocks the near-term value of our branded products. It considerably strengthens our balance sheet. It sharpens our strategic focus on developing new products that represent large market opportunities. It enhances our ability to create and deliver additional value for our shareholders. It also creates a branded business platform with more critical mass that Apotex can build upon to broaden the distribution of our brands and deliver them to more patients. We're confident in the direction of the company and in our ability to execute on this new strategy. With that, I'll now turn the call over to Todd M. Anthony, Vice President, Organizational Development. Todd?

Well, thank you, A.J. You know, in February, we hosted our spring national sales meeting in Nashville, and in attendance were the 50 individuals across the country who interact with our medical community in support of our FDA-approved products through our three national sales divisions. Our hospital sales division, which calls on key institutional accounts across the country, our field sales division that covers select office-based physicians, and the Cumberland Oncology Division, which calls on cancer patients. I'd now like to share our first quarter brand updates. Let's start with Caldolor, our intravenous ibuprofen product. In April, we announced approval from the FDA for an expanded indication for Caldolor. The indication now includes the management of post-operative pain. This approval enhances the clinical utility of Caldolor and supports its role in non-opioid and opioid-sparing pain management strategies.

With this update, Caldolor is indicated for use in adult and pediatric patients ages three months and older for the treatment of pain and fever. This expanded labeling further broadens Caldolor's use across perioperative and acute care settings. Additionally, we resubmitted our application to CMS for Caldolor's inclusion under the NOPAIN Act in the first quarter. This program is designed to support the use of non-opioid pain management therapies. Now let's turn to Sancuso, our transdermal patch, FDA-approved for the management of chemotherapy-induced nausea and vomiting. During the first quarter, we announced the launch of the new Sancuso website, which is designed to provide healthcare professionals and patients with enhanced access to educational resources, clinical information, and expert insights related to the prevention of chemotherapy-induced nausea and vomiting. Next, I'd like to share an update for Talicia, an FDA-approved leading treatment for Helicobacter pylori infection.

In February, we announced the launch of our national sales promotion for Talicia under our co-commercialization agreement with Talicia Holdings, Incorporated, which we jointly own. As a reminder, under that agreement, we assumed responsibility for the distribution and sales promotion of the brand in the United States. As part of the launch, we leveraged our existing field sales division with supporting marketing initiatives designed to increase awareness among gastroenterologists and other prescribers. Recall, we have been awaiting FDA clearance of the site where we have successfully transferred the manufacturing of Vaprisol. Today, I am pleased to announce that the FDA has just reinstated their approval status for that facility, which will enable us to submit for manufacture of Vaprisol there. With approval for our submission, we will then arrange for commercial supplies to support the relaunch of the brand, which is expected this year.

That completes my updates for today. I'll turn it over now to our Chief Financial Officer, John M. Hamm, to review our financial results. John?

Thank you, Todd. During the first quarter, our portfolio of FDA-approved brands delivered combined revenue of $9.1 million, which represented a 5% increase after removing the one-time $3 million milestone payment last year associated with the approval of Vibativ in China. Net revenue by product for the first quarter of 2026 included $1 million for Kristalose, $2.9 million for Sancuso, $2.1 million for Vibativ, $1 million for Caldolor, and $1.9 million for Talicia. Turning to our expenditures, total operating expenses for the first quarter were $12.3 million, resulting in a net loss of approximately $3.3 million for the first quarter. When non-cash expenses are added back, the resulting adjusted loss for the first quarter was $1.9 million or $0.13 a share.

We're pleased to see that our most recent acquisitions resulting in additions of Vibativ, Sancuso, and Talicia to our portfolio have provided a significant positive impact on our financial performance. Note that the shipments for individual brands fluctuate from quarter to quarter based on customer buying patterns, which include the timing of international orders. There's also some seasonality to our business, with orders being strongest in the fourth quarter and traditionally lightest in the first quarter. Therefore, we believe our sales performance is best evaluated on an annual basis. Meanwhile, we did continue to achieve our goal of generating positive cash flow from operations, which totaled $387,000 during the first quarter. As a reminder, we participated in the formation of a new company named Talicia Holdings, Inc., which holds the worldwide rights to the Talicia brand and its related product assets.

Cumberland invested $4 million in exchange for a 30% ownership positions in the new company. We are accounting for this holding using the equity method. Turning to our balance sheet as of March 31st, 2026, we had $71 million in total assets, including $11 million in cash and cash equivalents. Liabilities totaled $49.7 million, including $5 million on our credit facility. Total shareholders' equity was $21.6 million at the end of the first quarter. As A.J. Kazimi mentioned, we had signed an agreement to enter into our strategic transaction. In exchange for the assets associated with our portfolio of commercial products, we expect to receive $100 million cash at closing. We will also receive $9 million in payments for our commercial product inventory and a milestone payment.

Cumberland will support the transition of the products for a monthly fee associated with the transition services agreement. I'd like to note that Cumberland continues to hold over $53 million in tax net operating loss carryforwards, primarily resulting from the prior exercise of stock options. The assets involved in our pending strategic transaction have a tax basis of $30 million. We therefore believe that the income taxes resulting from the transaction will be modest. Given the announced strategic transaction, we are no longer targeting a goal of double-digit revenue growth for the year. Our expenses will be significantly decreased after closing as Apotex will assume responsibility for the sales, marketing, medical, manufacturing, and FDA fees associated with the brands.

I would also point out at this time that we do not see any significant change to our current clinical spending levels for 2026 as we continue to advance our line of product candidates, which are in the advanced stages of development. That completes our financial report for the first quarter of 2026. Back to you, A.J.

Thank you, John. Following the close of the strategic transaction, Cumberland will be an innovation-driven, development-focused company. We'll continue to progress our valuable pipeline of new product candidates designed to improve patient care and their quality of life. Our ifetroban new chemical entity, which is a potent and selective thromboxane receptor antagonist, is being evaluated in several advanced clinical programs for patients with a series of unmet medical needs. It's now been dosed in nearly 1,400 subjects and has been found to be safe and well-tolerated in those individuals, resulting in an outstanding safety database. We previously announced positive top-line results from our completed phase II study in patients with Duchenne muscular dystrophy, a rare fatal genetic neuromuscular disease that results in deterioration of the skeletal, lung, and heart muscles. During the first quarter, the FDA granted Fast Track designation for our ifetroban candidate in these DMD patients.

This designation is intended to accelerate the development and review of therapies addressing serious conditions with unmet medical needs. Importantly, it allows for more frequent FDA interaction, rolling data submissions, and earlier guidance throughout the approval process. The program also previously received both Orphan Drug and Rare Pediatric Disease designations from the FDA. An end-of-phase II meeting was held with the FDA last fall, and we had a follow-up meeting during the first quarter of 2026 to discuss both the DMD study results and to determine the regulatory pathway and requirements for approval. We're finalizing our plans for this important program now, and once completed, we'll announce additional results and expected timelines. Meanwhile, we've also been evaluating our ifetroban product candidate in a clinical program in patients with systemic sclerosis or scleroderma.

Enrollment in that study has been completed. We look forward to announcing top-line findings which will be forthcoming. In addition, we have a phase II clinical study, the Fighting Fibrosis trial, in patients with idiopathic pulmonary fibrosis, the most common form of progressive fibrosing interstitial lung disease. Patient enrollment in that study is well underway in centers across the U.S. An interim safety analysis was conducted evaluating the 1st cohort of patients who completed their 12 weeks of treatment. The independent committee concluded there were no new safety signals. Therefore, no changes in the study conduct were needed. Based on those findings, enrollment in the study has continued. We next expect to announce interim efficacy results later this year. Additional pilot patient studies of ifetroban are also underway through several investigator-initiated trials.

In summary, our clinical programs are focused on select patient populations to helping to address unmet medical needs in markets that are very large from a commercial perspective for a company our size. As we look ahead, we'll work to close our strategic transaction, support the transition of our commercial operations, and sharpen our focus on advancing our exciting pipeline of new product candidates. Lastly, I'd just like to extend my sincere thanks and appreciation to all of those at Cumberland for their unwavering dedication towards the patients we aim to serve every day. We're confident in the direction of the company, our future prospects, and in our ability to execute on our strategy. Thank you again for your continued support and interest in Cumberland. With that, we can open the call for any questions. Operator, please proceed.

Thank you, sir. Ladies and gentlemen, that concludes the company's presentation, and we will now open the calls for questions. Our first question comes from Alyssa Nye from IQ Solutions. Your line is now open. Alyssa, you can ask your question.

Operator, are there other questions?

Yes. We'll go on to the next question. One moment, please. Our next question is Brandon Bishop. The line is now open, Brandon.

Operator, there appears to be difficulties with the questions coming through. There is also an echo.

Yes. Let me see one second. If we can hold for a second, please.

Since we're having difficulty hearing the questions, it's very unfortunate. I suppose what we can do is if you would like to follow a conversation, please reach out to the company. We're happy to schedule a call with you and to answer your questions. Meanwhile, just wanna thank everybody for joining us on today's call. We'll look forward to providing another update in the coming months. Operator?

We have someone coming to fix the situation right now if we wanna hold for just one second.

No, that's okay. We will hold any questions. You can reach out to the company. Make sure that we can get those questions answered.

Hi, everyone. I apologize. I have jumped into the queue. If you'd like, I can go over the Q&A instructions again, and I will open the lines for anyone that's gotten into the queue.

That's okay. We will take our questions privately, if you don't mind.

Absolutely. I apologize for the inconvenience. Thank you.

Thank you.

Good afternoon, welcome to Cumberland Pharmaceuticals 2025 financial report and company update. This call is being recorded at the company's request and will be archived on its website for one year from today's date. I'd like to turn it over to Emily Kent from Dalton Agency, who handles Cumberland's communications. Emily, please proceed.

Thank you, everyone, and thank you for joining us today. This afternoon, Cumberland issued a press release announcing its annual and fourth quarter financial results. The release also provided an overall company update, including key developments during the year. The release, which includes the related financial tables, can be found on the company's website at www.cumberlandpharma.com. During today's call, management will share an overview of those financial results and a company update, including a recent development and a discussion of Cumberland's brands, pipeline, and partners. Participating in today's call are A.J. Kazimi, Cumberland's Chief Executive Officer, Todd Anthony, Vice President, Organizational Development, and John Hamm, Chief Financial Officer. Please keep in mind that their discussions may include some forward-looking statements as defined in the Private Securities Reform Act. Those statements reflect the company's current views and expectations concerning future events and may involve risks as well as uncertainties.

There are many factors that could affect Cumberland's future results, including natural disasters, economic downturns, international conflicts, trade restrictions, public health epidemics, and others that are beyond the company's control. Those issues are described under the caption Risk Factors in Cumberland's annual report on Form 10-K and any subsequent updates filed with the SEC. Any forward-looking statements made during today's call are qualified by those risk factors. Despite the company's best efforts, actual results may differ materially from expectations, so information shared on this call should be considered current as of today only. Please remember that the company isn't responsible for updating any forward-looking statements, whether as a result of new information or due to future developments. During today's call, there will be references to several of Cumberland's marketed brands.

Full prescribing and safety information for each brand is included on the individual product website, and you can find links to those sites on the corporate site at www.cumberlandpharma.com. The company will also be providing some non-GAAP financial measures with respect to its performance. An explanation and reconciliation to GAAP measures can be found in the tables of the earnings release that I noted was issued earlier this afternoon. If you have any questions, please hold them until the end of the call, at which point we will be happy to answer them. Management is also prepared to hold a follow-up conversation with shareholders after the call if you prefer. With that introduction, I'll turn the call over to Cumberland's Chief Executive Officer, A.J. Kazimi.

Thank you, Emily. Good afternoon, everyone. We do appreciate you joining us today. As Emily mentioned, we'll provide a review of both our fourth quarter and our full year financial performance for 2025. We'll also share an overall company update and discuss several recent developments that continue to underscore our optimism about the company's future. I'd like to start by stating that 2025 was an outstanding year for Cumberland. We announced breakthrough clinical study results, delivered strong financial performance, expanded our global reach, and added to our commercial portfolio, highlighting a year of consistent progress for our company. Most importantly, we remain focused on our mission of delivering unique products that improve the quality of patient care. Let's begin with a review of our financial performance.

Our portfolio of FDA-approved brands delivered combined revenues of $13.7 million during the fourth quarter of 2025, representing a 31% increase over the prior year period. For the full year, revenues totaled $44.5 million, up 18% over 2024. We therefore achieved our goal of double-digit revenue growth for the year. This revenue growth resulted in a turnaround in adjusted earnings, which improved by over $2 million to $1.7 million or $0.11 a share. In addition, cash flow from operations improved by $5.5 million and were just under $5 million for the full year. This financial performance reflects strong execution across our commercial organization with growing demand for our products.

It was led by dramatic growth for Vibativ and Sancuso, along with the initial sales of our newest brand, Talicia, which we began shipping in the fourth quarter. We also strengthened our balance sheet during the year. We increased shareholder equity and reduced the balance on our line of credit by more than $10 million, further improving our financial position. Beyond our financial performance, we made significant progress expanding our global presence. In 2025, Vibativ received regulatory approval in China, the world's second-largest pharmaceutical market, creating a major new opportunity for the brand. Also in 2025, Vibativ was successfully launched in Saudi Arabia, resulting in initial sales and the first patients receiving treatment with the product in that country. In addition, our ibuprofen injection product received regulatory approval in Mexico, which will enable our expansion into another important international market.

Turning now to our business development efforts, we continue to execute on our strategy of acquiring rights to differentiated branded pharmaceuticals. We added Talicia, an FDA-approved treatment for Helicobacter pylori infections, expanding our presence in gastrointestinal care. Talicia complements our existing portfolio and represents an excellent strategic fit, leveraging our established commercial infrastructure. Meanwhile, the Centers for Medicare & Medicaid Services, or CMS, issued a J-code for Caldolor. This important reimbursement milestone enhances product access, simplifies hospital billing, and further supports Caldolor's continued growth and its role as a standard of care for the treatment of pain and fever. During 2025, we also continued to advance our clinical programs, reinforcing our commitment to developing new therapies for patients with serious and underserved medical needs. Significantly, we continued to advance our clinical pipeline in 2025, highlighted by breakthrough results from our FIGHT DMD clinical study.

That trial evaluated our ifetroban product candidate in patients with cardiomyopathy associated with Duchenne muscular dystrophy, which is the leading cause of death in those patients. The top-line findings from that study were selected for a late-breaking presentation at the Muscular Dystrophy Association's Clinical and Scientific Conference and were also presented at the Parent Project Muscular Dystrophy Annual Conference. We completed the comprehensive analysis of the study results, prepared our clinical study report, and then submitted it to the FDA and began interactions with them to determine their remaining development requirements. The FDA has approved our request for Orphan Drug, Rare Pediatric Disease, and more recently, Fast Track designations for our DMD program. Overall, 2025 was a defining year for Cumberland. We grew our commercial business, advanced our development pipeline, expanded our global footprint, and strengthened our financial foundation.

With that overview and developments, I'd now like to turn to Todd Anthony, Cumberland's Vice President of Organizational Development, to further discuss both our brands and our organization. Todd?

Well, thank you, A.J. I'll start by sharing an update on each of our major brands. Vibativ is our intravenous antibiotic designed for difficult-to-treat infections, such as hospital-acquired and ventilator-associated pneumonia, as well as complicated skin and skin structure infections caused by certain Gram-positive bacteria, including those that are multidrug-resistant. Unlike many antibiotics that are losing the ability to fight bacteria, Vibativ's unique dual method of action was specifically designed to address drug-resistant bacteria. We therefore believe it has life-saving potential to help many patients amid this growing antibiotic resistance crisis, which faces a fragile pipeline of new antibiotic development. Recall that to reinforce this message, we are conducting a series of Infectious Insights, which are discussions with infectious disease experts that we're disseminating across the country. These video vignettes share the opportunity to use Vibativ as a solution for select patient types where other products have failed.

We also shared that a comprehensive pharmacokinetic analysis of Vibativ was published in Antimicrobial Agents and Chemotherapy. The analysis utilized data from over 1,200 patients across varied demographics and comorbidity profiles. The findings support optimized dosing strategies for patients with different infection severities and renal function levels, reinforcing Vibativ's critical role in treating life-threatening gram-positive infections. In 2025, we also announced the availability of the Vibativ 4-Vial Starter Pak through a new supply arrangement with Vizient, making it accessible to their healthcare members nationwide. The country's largest provider-driven healthcare performance improvement company, Vizient serves more than 65% of the nation's acute care providers, including 97% of our country's academic medical centers. Through this agreement, Vizient members have access to Vibativ's 4-vial configuration, which supports flexible treatment initiation in both an inpatient and outpatient setting for this potentially life-saving therapy.

Vibativ was also added to a national group purchasing agreement with Premier, Inc., an alliance of approximately 4,350 U.S. hospitals designed to drive transformation across the healthcare system. The product's addition provides Premier's membership with a cost-effective solution to treat resistant gram-positive infections. Moving next to Kristalose, which is our prescription strength laxative provided in a convenient pre-measured powder dose that dissolves quickly in just 4 ounces of water, resulting in a clear, taste-free, and grit-free solution. While our field sales division has been able to generate prescriptions of Kristalose through their promotional efforts, we have always faced substitution by pharmacies in favor of generic alternatives. That substitution has increased this year with the arrival of additional generic competition. We have taken appropriate action and are implementing strategies to protect and grow this business. Let's shift now to Caldolor, our intravenous ibuprofen product.

With its newest pediatric labeling cleared with the FDA, Caldolor now is the only non-opioid product approved to treat pain in infants that's delivered by injection. As a reminder, we are featuring Caldolor through sales and marketing initiatives highlighting this new indication, resulting in a growing use of the product in our country's children's hospitals. In 2025, we announced the publication of our study investigating Caldolor in Clinical Therapeutics, demonstrating the product's safety and efficacy for managing postoperative pain in patients 60 years of age and older. The analysis, encompassing over 1,000 patients from our comprehensive postsurgical study, represents the first such evaluation in this vulnerable population where traditional pain management options such as opioids carry increased risk. Turning now to Sancuso, our transdermal patch, FDA approved for the management of chemotherapy-induced nausea. We continue to see favorable sales results following expansion of our oncology division.

We have also launched a new Sancuso website, along with promotional marketing resources and digital marketing campaigns to further support awareness and access to this product. Lastly, let's review our newest product, Talicia, an FDA-approved and leading treatment for Helicobacter pylori infections. Provided in a single capsule that contains omeprazole, amoxicillin, and rifabutin, Talicia is now recommended as a first-line therapy for H. pylori infections via the American College of Gastroenterology's clinical guidelines. Note that the effective treatment of gastric ulcers is an important step in the prevention of gastric cancers. The product's outstanding profile includes three key advantages: a high eradication rate exceeding 90%, the convenience of an all-in-one capsule, and minimal antibiotic resistance. In 2025, we entered arrangements with RedHill Biopharma to jointly commercialize Talicia and formed a new company with RedHill named Talicia Holdings Inc.

Through our co-commercialization agreement, we have assumed responsibility for the distribution and sale of Talicia in the U.S. and equally share Talicia's net revenues. We launched the promotion of Talicia at the beginning of the year, and our newest brand is supported by our field sales division that also details Kristalose. We now have a national sales and medical organization that includes 50 customer-facing individuals who feature our brands. Well, that completes my updates for today, so I'll turn it back to you, A.J.

Thank you, Todd. I'd now like to provide an update on our ongoing clinical activities. We continue to progress our pipeline of innovative products designed to improve patient care and their quality of life. Our ifetroban product candidate, a potent and selective thromboxane receptor antagonist, is being evaluated in several clinical programs for patients with a series of unmet medical needs. It's now been dosed in nearly 1,400 subjects and has been found to be safe and well-tolerated in those individuals, resulting in an outstanding safety database. In February 2025, we announced positive top-line results from our completed phase II study in patients with the cardiomyopathy associated with Duchenne muscular dystrophy, which is a rare, fatal genetic neuromuscular disease that results in deterioration of the skeletal heart and lung muscles. Our study enrolled 41 DMD patients who received either low dose ifetroban, high dose ifetroban, or placebo.

High dose ifetroban treatment resulted in a 3.3% improvement in the patient's left ventricular ejection fraction compared to the placebo group. When compared to the propensity-matched natural history controls, the difference was even more pronounced, with high dose treatment providing a statistically significant 5.4% overall improvement in cardiac function as measured by LVEF. Both doses of ifetroban were well-tolerated with no serious drug-related adverse events seen in the study. All subjects who completed the 12-month treatment period opted into an open label extension where they continued to receive ifetroban with long-term follow-up. As I mentioned, ifetroban previously received Orphan Drug Designation and Rare Pediatric Disease Designation for DMD.

I'm pleased to report the program was also recently granted by the FDA Fast Track designation, that will enable us to have more frequent FDA interactions and also enable us to submit our application for approval on a rolling basis. We held an end of phase II meeting with the FDA last fall and a follow-up meeting in January of this year. We've been discussing with them the findings from our study and the path forward, and the requirements for approval of this product. Meanwhile, we've also been evaluating ifetroban in a clinical program in patients with systemic sclerosis or scleroderma, SSc. Enrollment in this study was completed last year, and we look forward to announcing the top line findings this year.

We have a phase II clinical study, the Fighting Fibrosis trial, in patients with idiopathic pulmonary fibrosis, the most common form of progressive fibrosing interstitial lung disease. Patient enrollment is well underway in medical centers across the U.S., the study includes both an interim safety analysis and an interim efficacy analysis. Today, I'm pleased to announce that the interim safety analysis was completed where it evaluated the first cohort of patients completing 12 weeks of treatment. The independent committee concluded that there were no safety signals, no new safety signals identified, and no changes in study conduct were necessary. Based on those findings, enrollment has continued, and we expect to announce next the interim efficacy results this year. We're also pleased with the publication of a manuscript which discussed the use of ifetroban to target platelet tumor interactions to reduce metastases in triple negative breast cancer.

That publication came out last November. It was peer-reviewed, and it highlights the novel mechanism of ifetroban and its potential to address serious and difficult to treat conditions. The manuscript was accepted and published in the journal of Experimental Hematology & Oncology. We believe this recognition helps strengthen the scientific foundation supporting ifetroban and contributes to broader awareness in the scientific and medical community as we continue to advance this development. There are additional pilot patient studies of ifetroban also underway through several investigator-initiated trials. Based on the results from the FIGHT DMD study that I mentioned, we've decided to now pursue ifetroban's registration for the DMD-associated cardiomyopathy as our lead indication as we plan to pursue the requirements and approval of the drug.

We also plan to continue our systemic sclerosis and pulmonary fibrosis programs that we believe can provide additional potential indications for this, our first new chemical entity. With that update on our clinical activities, now I'd like to turn it over to our Chief Financial Officer, John Hamm, to review our financial results. John?

Thank you, A.J. For the three months ending December 31st, 2025, net revenue from continuing operations was $13.7 million, which represented a $3.2 million or 31% increase over the prior year period. Net revenue by product for the fourth quarter of 2025 included $3.1 million for Kristalose, $3.3 million for Sancuso, $2.8 million for Vibativ, $0.9 million for Caldolor, and $3.3 million for Talicia. As a reminder, due to quarterly fluctuations in our customers' purchases, we believe our performance should be assessed based on annual sales results. With that in mind, I'm pleased to report that net revenues for the full year of 2025 were $44.5 million, a $6.7 million or 18% increase over the prior year.

Full year product revenues totaled $10.5 million for Kristalose, $11.9 million for Sancuso, $9.4 million for Vibativ, $4.7 million for Caldolor, and $3.3 million for Talicia. We also received a $3 million milestone payment associated with the approval of Vibativ in the Chinese market. Turning to our expenditures, total operating expenses for the fourth quarter were $15 million compared to $12 million for the prior year period. We did see an increase in operating expenses due to the higher royalties, cost of goods, and other items associated with the growth in product sales during the period. For the full year 2025, total operating expenses were $47.3 million compared to $44.3 million during the prior year.

The net loss was approximately $1.4 million for the fourth quarter and $2.9 million for the full year, both significantly improved over 2024. When non-cash expenses are added back, the resulting adjusted earnings for the year were $1.7 million or $0.11 a share. Cash flow from operations was $4.9 million in 2025. Please note that the adjusted earnings calculations do not include the additional benefit of the $0.2 million of Vibativ cost of goods during the fourth quarter. Those goods were received as part of the products acquisition. We're pleased to see that the additions of Vibativ, Sancuso, and Talicia to our portfolio are providing a significant positive impact to our financial performance.

As a result of the Vibativ acquisition, a total of $34 million in new assets were added, including approximately $21 million in inventory, $12 million in intangible assets, and $1 million of goodwill. The estimated value of those assets was $10 million at the end of 2025. The financial terms for the Vibativ transaction included a $20 million payment upon closing and a subsequent $5 million milestone payment. We also continue to provide royalties tied to product sales. Sancuso added a total of $19 million in new assets, including approximately $4 million in inventory and $14 million of intangibles. The estimated value of those assets was $10 million at the end of 2025. We provided $13.5 million at closing for the Sancuso acquisition, and we paid $1.5 million in milestone payments.

There are ongoing royalties that we pay based on the brand sales. We have formed a new company with RedHill Biopharma named Talicia Holdings Inc. RedHill has contributed the worldwide rights to Talicia and the product's assets to the new company. Cumberland invested $2 million during the fourth quarter of 2025 and will provide another $2 million later this year to participate in the new company's joint ownership. As a result of this investment, Cumberland owns 30% of the new THI and are accounting for this holding using the equity method. Turning to our balance sheet as of December 31st, 2025, we had $76.8 million in total assets, including $11.4 million in cash and cash equivalents. Liabilities totaled $52.3 million, including $5.2 million on our credit facility.

Total shareholders' equity was $24.9 million at the end of 2025. We continue to hold a bank line of credit which provides up to $15 million in capital. The interest rate is based on benchmark term SOFR and is subject to a financial covenant determined on a quarterly basis. We were in compliance at the end of the fourth quarter. We also continued the process of implementing trading plans for our board members in 2025 who purchased Cumberland shares throughout the year to increase their holdings in the company. I'd like to note that Cumberland continues to hold over $54 million in tax net operating loss carryforwards, primarily resulting from the prior exercise of stock options. That completes our financial report for the fourth quarter and full year 2025. Back to you, AJ.

Thank you, John. I'm very pleased with Cumberland's performance in 2025. We delivered strong sales, strengthened our financial position, broadened our international presence, enhanced our commercial portfolio, and continued advancing our clinical programs. These achievements reflect the disciplined execution of our strategy and the growing impact of our products. We remain focused on delivering differentiated medicines that address meaningful patient needs. Meanwhile, we're advancing our development programs as we work towards bringing new treatment options to patients facing serious unmet conditions. These accomplishments would not be possible without the dedication and experience of our team, and we appreciate the continued support of our shareholders, our partners, and our other stakeholders.

As we look ahead, we're once again targeting double-digit revenue growth in 2026, driven by the continued performance of our in-line brands, combined with the additional sales from the newest addition, Talicia, as well as our growing international business. We're also again targeting meaningful positive cash flow from operations. With that report, now let's open the call to any questions. Operator, please proceed.

Thank you, sir. Ladies and gentlemen, that concludes the company's presentation. We will now open the call for any questions. If you'd like to ask a question, please press the star key on your phone, followed by the digit one twice. That's star one one. Please stand by.

If there are no questions, I just want to thank everybody for joining today's call. We do understand many of our shareholders provide a private discussion with management, and if so, please just reach out and we'll be happy to get a call scheduled with you and hold such a discussion. As always, we appreciate your time and interest in our company, and we look forward to providing another update in the coming months.

Thank you, sir. Ladies and gentlemen, that concludes today's call. If you would like to listen to a replay of the discussion, please visit the investor relations section on Cumberland's website. I would like to thank you for your participation. You may now disconnect.