LNTH

Good morning. Welcome to Lantheus' first quarter 2026 conference call. All lines have been placed on mute. This call is being recorded, and a replay will be available in the Investors section of the company's website approximately 2 hours after the completion of the call and will be archived for at least 30 days. I'll now turn the call over to Mark Kinarney, Vice President of Investor Relations. Mark?

Thank you. Good morning. With me today are Mary Anne Heino, our CEO and Executive Chairperson, Amanda Morgan, our Chief Commercial Officer, and Robert J. Marshall Jr., our CFO. We will begin with prepared remarks and then take your questions. This morning, we issued a press release which was furnished to the SEC under Form 8-K reporting our 1st quarter 2026 results. The release and today's slide presentation are available in the Investors section of our website. Any comments could include forward-looking statements. Actual results may differ materially from these statements due to a variety of risks and uncertainties, which are detailed in our SEC filings. Discussions will also include certain non-GAAP financial measures. Reconciliation of these measures to the most directly comparable GAAP financial measures is included in the Investors section of our website. I will now turn the call over to Mary Anne.

Thank you, Marc, and good morning, everyone. We had a strong start to the year with solid performance across PYLARIFY, NeuraCeq, and DEFINITY. These results reflect our ongoing commitment to focus and discipline across the organization. As we said last quarter, 2026 is a year of commercial execution and regulatory milestones. We're making deliberate choices about where we focus our commercial effort and deploying capital so we're positioned to deliver solid results in 2026 and accelerate growth in 2027. Our corporate focus is centered on radiodiagnostics. Our priorities for 2026 are clear. First, maintain our market leadership in PSMA PET while preparing for a seamless transition to PYLARIFY TruVu, our newly approved PSMA PET formulation beginning in the fourth quarter.

Second, continue to build momentum for NeuraCeq through deeper penetration within existing accounts, leveraging the breadth of the Lantheus portfolio to unlock incremental growth opportunities and expanding our manufacturing footprint, increasing supply availability. Third, advance our late-stage clinical portfolio through key regulatory milestones and ensure launch readiness aligns with coding, coverage, payment, customer preparedness, and market opportunity. Finally, allocate capital with discipline, prioritizing radio diagnostics while evaluating value-maximizing alternatives for our radiotherapeutic assets. In addition to effective commercial execution, we advanced several key programs during the quarter that support our long-term growth strategy. On March 6, the FDA approved PYLARIFY TruVu, our new PSMA PET imaging agent. PYLARIFY TruVu offers the same proven diagnostic properties as PYLARIFY with a similar safety and efficacy profile. The value add of this product will be the larger batch sizes that can be enabled at manufacturing sites with high-energy cyclotrons.

This creates the potential to serve more patients and support a broader geographic reach. We estimate that more than 70% of PYLARIFY supply today is produced at PMF sites equipped with high-energy cyclotrons, giving us confidence that through our broad PMF network, we are well-positioned to optimize the benefit that PYLARIFY TruVu can provide. We also announced during the quarter the FDA extended the PDUFA date for Actevi by 3 months to June 29, 2026, to allow additional time to review manufacturing-related information. Similar to our efforts with PYLARIFY TruVu, we remain focused on advancing launch readiness, including securing coding, coverage, payment, and customer preparedness through the second half of 2026, with the objective of a full commercial launch in early 2027.

On March second, we announced that the FDA had offered tentative approval for PNT2003, the first radio equivalent to LUTATHERA for the treatment of gastroenteropancreatic neuroendocrine tumors or GEP-NETs. Tentative approval confirms that the FDA has completed its substantive review and that our application meets the requirements for approval. The timing of our launch will consider the following factors: timing of final FDA approval, the expiration of the 30-month Hatch-Waxman stay, and disposition of the related legal proceedings, as well as manufacturing and commercial strategy to ensure launch success. As outlined last quarter, our strategy and related investments are centered on radio diagnostics, the progress we made this quarter reflects that focus. We are selectively prioritizing first and best-in-class PET radio diagnostic assets that complement our existing commercial portfolio and align closely with our nuclear medicine customer base. I will highlight a few key pipeline updates.

MK-6240, our registrational-stage tau-targeted PET radiodiagnostic for Alzheimer's disease, represents an important asset within our Pharma Solutions portfolio and is the leading imaging agent supporting late-stage Alzheimer's disease-modifying therapy or DMT development. It is currently the most widely used imaging agent in beta-amyloid and tau-targeted therapeutic candidate clinical programs. MK-6240 serves as an imaging agent for treatment eligibility in 17 current pharma-sponsored AD therapeutic programs. It has a PDUFA date of August 13th of this year. LNTH-2401, our gastrin-releasing peptide receptor, or GRPR, targeted PET radiodiagnostic for prostate cancer, is advancing towards its planned registrational program this year.

GRPR is a differentiated target from PSMA, and Lantheus twenty-four oh one has the potential to complement PSMA PET imaging by identifying disease in patients who may be PSMA negative or equivocal, extending the addressable prostate cancer population while fitting naturally within our existing prostate cancer franchise. Across the pipeline, we remain disciplined in strategically deploying investments based on stage gates and long-term opportunity. With robust mid and long-term revenue drivers, a promising late-stage pipeline, and a clear strategic roadmap, we are confident in our ability to drive meaningful performance gains that support a compelling outlook for our shareholders. We're executing against that plan. Our strong first quarter results reinforce that 2026 will be a year of commercial execution and regulatory progress, laying the groundwork for growth acceleration beginning in 2027. I also want to provide a brief update on our CEO search.

The board's process is progressing well, and we have narrowed the search to a small number of highly qualified candidates. In the meantime, our leadership team and I remain fully focused on execution as the first quarter results fully demonstrate. I will now hand the call over to Amanda to provide additional detail on commercial performance across our oncology, neurology, and cardiology assets.

Thank you, Mary Anne. First quarter performance demonstrated continued commercial execution across our portfolio, with solid volume growth and disciplined performance across each of our three core products. PYLARIFY, our market-leading PSMA PET imaging agent, delivered a solid quarter, with U.S. volume increasing approximately 5.8% year-over-year. Performance was driven by consistent demand across our established customer base and continued pricing discipline in a highly competitive environment. Net ASP and volume for PYLARIFY remained stable sequentially despite ongoing competitive activity. We are well-positioned as we continue to execute on our portfolio-based strategy. This evolution strengthens our presence across sites of care and our PMF network and reinforces our market leadership in PSMA PET. Together, these factors support a seamless transition to PYLARIFY TruVu, accelerate NeuraCeq growth, and prepare the organization for future launch opportunities.

Overall, PYLARIFY remains a core contributor to our radiodiagnostic strategy, supported by disciplined execution, deep customer relationships, and continued usage and expansion of PSMA PET. The FDA approval of PYLARIFY TruVu marks the next chapter of our flagship PSMA PET portfolio and reinforces our ability to serve the market reliably and at scale. With approval secured, we are now executing against our transition plan, with meaningful revenue contribution expected in 2027. We have submitted our application for a HCPCS code and are preparing to apply for transitional pass-through status. In parallel, we are working closely with our PMF partners to secure necessary FDA approvals for each manufacturing site ahead of the planned conversion, targeted to begin in the fourth quarter of this year. Our approach is deliberate.

We will initiate conversions only once reimbursement coding is in place and customers and payer systems are ready to submit and process claims. Our PMF partners are preparing to transition to the new formulation and recognize the operational advantages that PYLARIFY TruVu offers, including enhanced stability at higher radioactive concentrations, which provides greater supply flexibility. This creates the potential to serve more patients within a given market or support delivery to sites that are further from the manufacturing location, or potentially both, depending on demand in a particular area. Now turning to the rest of our commercial portfolio. NeuraCeq, our beta amyloid PET imaging agent for Alzheimer's disease, generated $35.4 million in the first quarter revenue, representing 14.3% growth compared to the fourth quarter of 2025.

As the second most utilized and fastest-growing beta amyloid PET imaging agent in the U.S., NeuraCeq addresses a large and expanding market opportunity. Growth was driven by increased utilization within existing accounts, supported by broader adoption of Alzheimer's, DMTs, and clinical guidelines that favor earlier diagnostic use, particularly in patients with mild cognitive impairment and early Alzheimer's disease. We are leveraging our existing nuclear medicine relationships across the Lantheus portfolio, supported by continued expansion of our NeuraCeq PMF footprint, which is now up to 22 sites, to drive execution and incremental growth as additional locations come online. Together, these factors further build on the momentum exiting 2025 and reinforce our confidence in NeuraCeq's long-term growth potential.

DEFINITY, our market-leading ultrasound enhancing agent, remained a steady contributor to our overall performance and delivered $84.6 million in first quarter revenue, representing year-over-year growth of approximately 6.8%. Growth was primarily driven by increased volume demand. With more than 80% market share, DEFINITY continues to demonstrate the durability of a long-standing market preferred product supported by deeply embedded clinical workflows and consistent utilization across sites of care over its 25-year history. I'll now turn the call over to Bob to provide more detail on our first quarter results.

Thank you, Amanda, and good morning everyone. I will provide highlights of the first quarter 2026 financials, focusing on adjusted results with comparisons to the prior year quarter, unless otherwise noted. Revenue for the first quarter was $377.3 million, an increase of 1.2% compared to the prior year, and increased 8.6% when adjusted to exclude $25.2 million of SPECT revenues from the same period prior year, which was divested on January 1st. Before I begin with the details, I would like to note that we have reconfigured our revenue reporting into new categories to reflect the diversity of our portfolio. The four main groupings include oncology, neurology, cardiology, and strategic partnerships and other, as well as one additional for the divested SPECT business to reflect prior period results.

Our SEC filings reflect this change. We have grouped prior period comparisons accordingly. Now, starting with oncology, consisting of PYLARIFY, it contributed $240.9 million of revenue, down 6.5% from the prior year. Neurology revenue, consisting of NeuraCeq, was $35.4 million for the quarter. Cardiology revenue, consisting of DEFINITY, was $84.6 million, up 6.8% year-over-year. Strategic partnerships and other revenue was $16.3 million, up 52.1% due to the strength of our Pharma Solutions portfolio in addition to adding the Evergreen CDMO business. MK-6240 represented over half of the revenue in this category.

Gross profit margin for the quarter was 67.0%, flat to first quarter 2025, favorably impacted by the SPECT divestiture, PYLARIFY and DEFINITY volumes, as well as DEFINITY price, offset by a decrease in PYLARIFY net price and inclusion of the Evergreen manufacturing facility and a near-term margin dilution of NeuraCeq relative to company average, both of which were not in the comparative period. Operating expenses at 32.8% of net revenue were 455 basis points unfavorable from the prior period, favorable to previously guided spending levels. This increase was mainly due to the acquisitions of Evergreen and LMI operations across each spending category, which are not reflected in the prior period. Increases in research and development expense, which was due largely to planned investments to advance our expanded clinical stage portfolio.

Sales and marketing increases reflect the inclusion of the NeuraCeq sales team and launch activities, mainly focused on PYLARIFY TruVu. G&A was up slightly in the period due to higher professional fees and employee-related costs in the quarter. Operating profit for the quarter was $129.1 million, a decrease of 10.5%. Other income and expense was $0.8 million of expense. Total adjustments in the quarter were $28.1 million of net adjustments before taxes. The company recorded a gain on the sale of SPECT of $59.3 million, an unrecognized gain of $16.6 million attributed to its equity investment in Perspective Therapeutics, offset by an unrecognized loss of $1.7 million on Radiopharm Theranostics.

Also offsetting these gains, the company incurred $16.0 million and $16.7 million of expense associated with non-cash stock and incentive plans and acquired intangible amortization, respectively. The company recorded $6.4 million of other acquisition integration and divestiture costs. The remaining $7 million is related to other non-recurring expenses. Our effective tax rate was 25.3% in the quarter. The resulting reported net income for the quarter was $118.4 million and a profit of $95.8 million on an adjusted basis, a decrease of 12.5% from the prior year period. GAAP fully diluted earnings per share for the first quarter was $1.80 and $1.46 on an adjusted basis, a decrease of 4.6%. Turning to cash flow.

First quarter operating cash flow totaled $125.1 million as compared to $107.6 million in the prior year quarter. Capital expenditures totaled $3.2 million, $5.5 million less than prior year quarter. Free cash flow, which we define as operating cash flow less capital expenditures, was $121.9 million, an increase of $23.1 million from the prior year period. Taken together, cash and cash equivalents, net of restricted cash, were $498.6 million as of the end of Q1. We have $200 million remaining on our board-authorized buyback program and have access to our $750 million undrawn bank revolver. Now turning to expectations for full year 2026.

The strong start to the year across the portfolio reinforces our confidence to deliver on the outstanding guidance for both revenue and adjusted EPS. We remain steadfast in our strategies to protect the long-term value of our PSMA franchise, especially ahead of launching PYLARIFY TruVu beginning later this year, and also remain ever mindful of potential competitive dynamics. Our full year forecasted revenue remains at $1.4 billion-$1.45 billion for 2026. Our first quarter results underscore the disciplined execution of our strategic priorities and commitment to streamlining our cost structure to drive operational efficiencies, enabling us to support sustainable long-term value creation.

We are making progress to evaluate alternative opportunities for the therapeutic assets to rebase the company's earnings profile and growth trajectory, as was noted on last earnings call. We continue to balance strategic investments and cost management across the organization and expect to deliver solid bottom-line results with EPS in a range of $5-$5.25. With that, let me turn the call back to Mary Anne.

Thank you, Bob. In the first quarter, we accomplished what we set out to do. PYLARIFY, NeuraCeq, and DEFINITY all performed well, and we achieved two important regulatory milestones with the FDA approval of PYLARIFY TruVu and tentative approval of PNT2003. Looking ahead, our priorities are unchanged. Maintain our market leadership in PSMA PET by sustaining PYLARIFY volume growth and executing a seamless transition to PYLARIFY TruVu. Continue to build momentum for NeuraCeq and successfully advance our registrational stage products towards regulatory milestones. All of these will position Lantheus for the growth acceleration we expect beginning in 2027. We are driving forward through the rest of 2026 with confidence in our strategy and in the Lantheus' team ability to deliver. The first quarter was a terrific start, and we remain focused on the work ahead. With that, I'll turn it over to Q&A. Operator?

Thank you. To ask a question, please press star 11 on your telephone and wait for your name to be announced. To withdraw your question, please press star 11 again. In the interest of time, we ask that you limit yourself to 1 question. Please stand by while we compile the Q&A roster. Our first question comes from Anthony Petrone of Mizuho Financial Group. Your line is open. Anthony, please unmute. One moment for our next-

Anthony.

Anthony? We'll go to our next question. One moment. Our next question comes from Richard Newitter of Truist. Your line is open.

Hi. Thanks for taking the questions, and congrats on the progress this quarter. I've got, I guess the first one maybe for Bob on guidance. You know, you had a pretty nice beat in the first quarter across the board at just about every product line. I guess the reiteration of the guidance seems to step down into 2Q to 4Q, presumably for all the businesses. I'm assuming that's, you know, just conservatism on your part. I just wanted to make sure, one, that's the case, and then is there anything you're seeing that would lead you to be incrementally cautious as we move forward into the remainder of the year?

Or is this just, you know, good old-fashioned prudence on your part? You still have a few more quarters of transitional pass-through disadvantage to get through. If you could just comment on what your assumption is for PSMA PET imaging diagnostics market growth in 2026 for the remainder of the year, and what did it grow in the first quarter. Thank you.

I'll start with the, obviously, with the guidance. You know, to your point, we had a very solid start, and, you know, we saw that in terms of volume growth, in terms of pricing dynamics. You know, fairly steady state from what we've seen over the last number of quarters. In fact, you know, almost delivering exactly the same number for each of the last 3 quarters in a row. It's early in the year, we're gonna remain vigilant to the market, the competitive environment out there. We still have, you know, one competitor who is, you know, maybe will find some footing with their new product launch themselves, as well as one that will be losing pass-through later this year, call it October 1st.

You know, for us, we're going to, you know, we're gonna, to your point, we're gonna be prudent with this. The other thing that I think that plays into this a little bit is the fact that, you know, as Mary Anne noted in her prepared remarks, that we, you know, we do see a new CEO in the near future, and I think it's right to allow that person to own the balance of the year. You know, our assumptions really haven't changed in terms of expecting, you know, what we had said earlier in terms of growth to net as the year progresses. I still continue to model modest volume growth looking forward. I wouldn't have you model Q1 forward in that sense. Our strategy remains the same. It's intact.

We're watching our competitors and, you know, talking with our customers from many disciplines. Again, the focus for the year is on launching PYLARIFY TruVu and protecting that franchise on a going-forward basis.

Hey, Rich, it's Mary Anne, I'll step in on your second question around the PSMA PET market growth. I think the market continues to play out exactly as we anticipated. If we look back at 25, we saw high teens to low 20s% growth for the entire market over the course of the year prior, you know, relative to the prior year. This year, as I think we shared in our last quarter's discussion points, we were backing off and saying that we expected for 26, that growth would be in the low teens. I think that is what we're seeing. I'm not being specific because this is a market that, from a data perspective, truly has to be triangulated.

Unlike the pharmaceutical prescription market, there are no clean third-party data sources to kind of bring these estimates together. What we do is we look at our own results. We, of course, monitor what our competitors are reporting. However, as you can imagine, there's not a lot of talk track from Novartis on Locametz and POSLUMA is offered by a private company. I'm offering you that just to say I'm not trying to avoid giving you a direct numeric answer, but it is a triangulated figure that we arrive at, and we're very pleased with what we're seeing in the market.

Thank you. Our next question comes from Anthony Petrone from Mizuho Financial Group. Your line is open.

Oh, sorry about that, was muted, hopping across calls here. Congrats on the strong start to the year. Maybe just on TruVu into the, you know, TPT ruling and just launch. You know, how that's gonna sorta work out from a contracting perspective. When do you think TruVu will be, you know, completely adopted? At what point does, you know, PYLARIFY, you know, gen 1 get phased out? That'll be my question. I'll hop back in queue. Thanks.

Terrific. Good morning, Anthony, thanks for the question. I'll take that for you. First, let me offer for clarity. PYLARIFY won't be phased out. PYLARIFY will be transitioned directly to PYLARIFY TruVu. In any market, only one of the products will be available at a time. That's very purposeful on our part because as you can imagine, if our PMS partners had to run two different batches, which they would have to, it would take up too much of their manufacturing time, and we prefer to have a single product in each market that we can focus on. I wanted to offer that for clarity. It will be geographically a site-by-site conversion. As we've offered before, I'll share again that we plan to begin that conversion in Q4 of this year.

It's very carefully thought out, and I'll explain why. These products, as a class, PET diagnostic products are uniformly prior authorization. You require prior authorization for insurance to cover them. We must ensure that insurance coverage is in place and that the systems are fully operational with the coding and the coverage requirements for Trueview before we take that product into any market. In like fashion, and you're aware of this from these comments we've offered, we also have to make sure that we have our HCPCS code and that we have TPT in place, transitional pass-through payment. Those have slightly different schedules of what the application, you know, processes for applying and then receiving it. From our perspective, the one piece that's clear is all must be in place before we ask our customers to start ordering Trueview.

We've worked long and hard to make sure that this will be a seamless transition. We're really confident in it. That's why you've seen already we got the approval date, but we're not yet in the market. This is carefully thought through and will be exceptionally executed once we take it into the market.

Thank you. Our next question comes from Roanna Ruiz of Leerink Partners. Your line is open.

Hey. Morning, everyone. I have a follow-up question about TruVu. I was curious, what strategies do you plan to use in terms of enabling customer readiness and prepping hospitals and imaging sites to potentially switch and get really comfortable with TruVu? I was also curious, you know, given what you've learned from the original PYLARIFY launch, is there anything you wanna get ahead of and proactively mitigate in terms of possible hurdles to adoption?

Rona, I'll take your question as well, and I'll kinda bounce off of what I just shared from Anthony's question. This is a masterpiece of preparation because before the first dose and from our customer's perspective, all we want them to see is that their dose shows up and that the coverage and payment, the reimbursement for it, has already been fully approved. We want it to look invisible to them as to which of the Lantheus PET franchise products they're using, TruVu or PYLARIFY. Again, they'll only be using one at a time. There's lots we can do to get ready. You heard Amanda in Amanda's comments, her repeatedly referring to our prostate cancer franchise. It is actually in the nuclear medicine customer base, it's actually more than that.

We are a full portfolio of products that we bring them in addition to our prostate cancer, PET products. All of our communications with our customers really center on one thing. Do you have the access you need? Does the product show up when you need it? Do you get fair reimbursement and coverage for it? That is what we work continuously to ensure for our patients. We also will have some work done in order to contractually prepare our customers for TruVu versus PYLARIFY. That is also something that we're very experienced with. From a nuclear medicine perspective, we have been doing this for 60-plus years, with the nuclear medicine department. We're also confident that we will, that we'll be able to handle that.

I will say just operationally, there is a set of functional steps that we'll go through with each PMS to ensure that they can manufacture and that they're approved to manufacture. As we've shared in the past, PMS, as a network and as an individual site, are individually approved as GMP manufacturing sites by the FDA. We also have a very carefully thought-through plan as to how to secure region by region to ensure that the FDA approvals are in place for all of our PMS sites. As with any other manufacturing site, there's a set of steps you go through with what's called validation batches, which kinda proves out the manufacturing process and that you can consistently replicate that process. Let's remember, PYLARIFY was a first.

Not only in PSMA PET, but in the scale of a new launch that had not been seen in many decades in a PMF network. We did it then. We are very confident we can do it again with PYLARIFY TruVu.

Thank you. Our next question comes from Matthew Taylor of Jefferies. Your line is open.

Hi. Thanks for taking the question. On TruVu, I was wondering if you could talk a little bit about the pricing strategy with TPT and how much in the initial transition period can you realize, and can you give any high-level thoughts on how that could impact 2027?

Matt, it's Mary Anne. Good morning. Thanks for your question. I will share what I always share. We don't talk about pricing strategy. What I will say and what I think all of you from working so closely with us over the years are aware of is that Transitional Pass-Through is a reimbursement mechanism that's available only in the hospital outpatient setting and only applies to traditional fee-for-service Medicare patients. We're very cognizant of how to ensure that the possibility and the opportunity of that coverage being available for that patient group is something that our customers are very aware of. I don't think I need to say that it's certainly from our learnings with PYLARIFY.

It's something we're very focused on to ensure that that reimbursement status is clear and available to all of our hospital-based customers, especially those who have larger patient populations of traditional fee-for-service Medicare. We will not give forward guidance obviously to 2027 yet. You'll have to wait later in the year for that, Matt. As we've said repeatedly throughout our script, we do see 2027 as a year of growth acceleration, so you can probably infer from that.

Thank you. Our next question comes from Yuan Xie of B. Riley. Your line is open.

Good morning. Maybe a question to Maryanne or Amanda. On your radar, do you see any other F-18 or gallium-68 PSMA imaging agent entering the market in the next couple months, and which market or geographic areas do you anticipate some meaningful impact? Thank you.

You're welcome. I'm gonna let Amanda take that for you.

Sure. Thanks for the question. As you can probably imagine, we continuously monitor the marketplace, and we're watching for all types of agents that could enter the market. We remain steadfast on the franchise that we have set up through our prostate cancer franchise and PYLARIFY and the follow-on asset of PYLARIFY TruVu. We will continue to monitor the marketplace, but we remain confident in the franchise that we've established, and we remain confident in the relationships that we have with our entire portfolio as well as within our nuclear medicine relationships.

I'll just add there. I think as anyone who follows this space is aware, we follow. There are two copper-based products that are in development, late stage that have the potential to enter the market at some point in the future. We don't see any of that occurring in 2026, but we continue to follow their progress and their programs. We're also aware that there are two other gallium-based products worldwide, PSMA gallium-based products that could have potential for application into the United States. Again, we don't see those as imminent on our high line use. We have and have purposely developed a portfolio approach to our nuclear medicine customer base.

We feel that that will keep us highly competitive and successful in our interactions with not only our prostate cancer franchise but on our urology franchise, and any other therapeutic areas that we enter with that customer base.

Thank you. Our next question comes from Paul Choi of Goldman Sachs. Our next question comes from Andy Hsieh of William Blair.

Oh, great. Thanks for taking our question. Maybe just a kind of an educational one for us. Mary, you mentioned about the high-energy cyclotrons that's required for Trueview. Can you give us a sense of what percentage of your PF network is equipped with such equipment? Do you foresee longer term, all of them will be transitioned to the high-energy versions? Just maybe comment as you go through the hardware transition, any sort of supply, maximum supply versus what you expected for the original PYLARIFY? Just kind of get a sense of the ramp-up and also from production perspective. Thank you.

Sure. It's a great question. I did address a little bit of this in my remarks, but when we look out at what the current PMF network is that services PYLARIFY and will service PYLARIFY TruVu in the future, we estimate that already 70% of that, and I'll call it a fleet, it's a fleet of manufacturing sites. We estimate that 70% of our fleet is already serviced by high energy cyclotrons, and therefore that gives us the confidence that what we see as the value add of PYLARIFY TruVu is directly transferable into the market. I do want to address operationally something you mentioned about transition of hardware to PYLARIFY TruVu.

If you understand the operational basis of a PMF, they essentially use a cyclotron to produce isotopes, and their predominant isotope is obviously F-18. F-18 then is run through a manufacturing process that's called a synthesis box, and it is on the synthesis box that the product-specific elements are added in to form the final product. It is a different set, and they call them, trace You know, synthesis boxes have different names, but for all intents and purposes, they call the objects cassettes that they attach to the synthesis boxes to complete the final production of the F-18 labeled isotope imaging agent.

In this case, they will use a different set of cassettes to produce PYLARIFY TruVu compared to what they were using for PYLARIFY and compared to the other types of cassettes they use to produce other F-18-based isotopes like FDG or the other isotopes that they're producing. To the other part of your question, I'll say that the incredible success of PSMA PET imaging agents as well now as the emerging building success of PET-based Alzheimer's disease agents has incredibly invigorated the PMF network chains that service the U.S. medical market. It's a clear opportunity to them and for them to invest in their operational readiness with higher energy cyclotrons.

I can't speak to what their capital plans or for investment are, but I can speak to what has clearly been a renaissance of PMF-based products in the United States and what that means for their, for their business case. Again, just to reiterate to you the first part of your question. The PMFs that produce PYLARIFY, 70% of our dose volume currently comes from PMFs that have high energy cyclotrons in place. I hope that was clear and helpful.

Thank you. Our next question comes from Paul Choi of Goldman Sachs. Your line is open.

Hi, thank you, and apologies for fumbling the question earlier. My question is on gross margins, which looked better this quarter than it has in a little while, and this is ahead of your potential switch to TruVu down the line and getting to scale. My question is, you know, is this sort of a more normalized run rate, or is this sort of a one-off for this quarter, as we think about sort of the margin profile over the short to intermediate term? Thank you very much.

Paul, appreciate the question. You know, when we gave guidance, I don't know, back whenever it was, end of February, I think it's been noted that we would be between sort of 65% and 66%. You know, we're probably gonna end up trailing toward the higher end of that particular range. There is a little bit of a one-off, and we did have a lot of benefit, you know, coming from, you know, PYLARIFY and DEFINITY volumes. We had, you know, the SPECT divestiture, which is the majority of the year-over-year change, but that was offset by, you know, the PYLARIFY pricing headwind, and as well as, you know, the inclusion of LMI and Evergreen into the mix. You know, that was intentional.

That was, you know, for the SPECT divestiture in the sense that that gives us sort of the tailwind to offset the PYLARIFY pricing headwinds that we see. I would still have you model more like where I had guided, but maybe toward the higher end of the range.

Thank you. As a reminder, if you have a question, please press star one one. Our next question comes from Justin Walsh of Jones Trading. Your line is open.

Hi. Thanks for taking the question. I'm wondering if you can comment on the process for turning PNT2003's tentative approval into a potential full approval in June. Wondering if you can remind us if PNT2003 is included in the current guidance.

I'll start with your question about approval, then Bob can speak to what he has included in the guidance or not. As I mentioned in my comments, PNT2003 did receive tentative approval in March from the FDA. For them having offered tentative approval, what they convey with that is that essentially their review is complete, and they find the basis of approval for the product. However, because there is a Hatch-Waxman stay with this product, the final approval will require, let's call it 3 different things. The first is either the expiration of or the resolution of the Hatch-Waxman stay. What that means is it's essentially a challenge about whether the original product's patents are being violated by your application.

To the extent that if it's not, you can either have one of two things happen. The 30-month period can expire, or the FDA can rule ahead of that the finding that there is no infringement for the product. There's also then related to that, there is the disposition of kind of related legal proceedings, which again is more of a legal issue, and we will of course, wait for that. There was the citizens petition also filed by Novartis and their request for reconsideration of that citizens petition. That was a 150-day period from when it was first filed.

All of that together, I think what we're saying and what we're trying to communicate is that once we have final approval from the FDA, we can technically launch the product. We see that occurring again, either at the expiration of the Hatch-Waxman period or the resolution of it, and then the related legal findings. Having said that, what I would also like to communicate is our decision on ultimate launch date will follow the comments you heard me say repeatedly throughout my remarks. That is, we will ensure that there is launch readiness, customer preparedness, and that all coding and reimbursement-related benefits are in place for the product before we take it to market.

As with regard to what's in the guidance, I think we had said during the beginning of the year that any of the approvals that we would be getting for products this year were not considered, and we should not be sort of in any material way embedded into the 2026 total revenue expectation. You know, I would not. It's not in the model, effectively.

Thank you. Our next question is a follow-up from Matthew Taylor from Jefferies. Your line is open.

Hi. Thanks for taking the follow-up. I just had a follow-up on guidance. I wanted to ask, because of the strong start with PYLARIFY, when you guided before, you were talking about the potential for pricing pressure and baking in some conservatism. I guess I just wanted to confirm, it doesn't seem like you're seeing that, are you? I guess B, it sounds like you're being conservative with a new CEO coming in. That makes sense. Would you have raised guidance if not for that?

You know what, Matt? I'm going to give Bob a break on this one and answer your question. Which I think in large part, Matt, you may have answered for yourself with the way you phrased it. We're early in the year. We're really happy with our first quarter results. We're also sitting pretty much right in front of a CEO change, which I've also been fairly transparent about. I think for all of those reasons, we felt that the most prudent thing we could do was hang with the guidance that we had already offered, which we felt was already a great outlook for our company.

Thank you. Our next question is a follow-up from Anthony Petrone of Mizuho Financial Group. Your line is open.

Hopping back and forth, wanted to press again on NeuraCeq for a moment. Maybe just to reset on NeuraCeq and the landscape there for beta amyloid tests and, you know, where is the NeuraCeq share today, you know, relative to competitors? I think GE's out there with Vizamyl and Lilly has Amyvid. What is the expectation for a higher attach rate to the 2 disease-modifying agents going forward? You know, the prescription trends for Alzheimer's disease look bullish. Just an update on that market as we look into the back end of the year. Thanks.

Anthony, I'll start with this, and then Amanda can jump in if I miss anything. I think what you've heard us repeat now, you know, consistently is NeuraCeq holds two places of note in the beta amyloid imaging market. First, it is the fastest agent growing of the three agents that are currently present in the market. Second, it holds the second-highest share already in that market. I'm not going to offer specific market share, again, for the reason that these are estimated figures. We have to triangulate back into them, and I don't think it's germane. I think what's germane to hear from us is that we are investing in NeuraCeq to ensure that it has expanded availability. Availability is key in this market as it is in the other PET tracer markets.

That is our major investment thesis for 2026, that we can accomplish 2 things. Well, actually, I'll take it even out to a 3rd thing. First, we can use our portfolio approach to have our customers use NeuraCeq as their beta-amyloid imaging agent of choice based on their relationship with Lantheus and the customer service we provide. Second, that we can drive deeper penetration in existing NeuraCeq accounts. That goes along with the great growth we're seeing in the market because of, as you referenced, the adoption of and the continued adoption of the beta-amyloid therapeutic agents. Third, that we can expand the footprint of where the product is manufactured so that, again, it serves number 2, which is deepening penetration in existing accounts, but it also gives us access to new accounts out there.

These are all benefits that we had considered as we considered the LMI acquisition, because as a company at their size and their financial capabilities before the acquisition, they just did not have the bandwidth to take on some of these opportunities. We do, and we will, and we see that coming back to us not only in 2026 already, but certainly in 2027 and beyond. Amanda, did I leave anything out of note?

Yes. You did a fantastic job. Maybe I'll just add a few key points that NeuraCeq is really addressing a large and expanding market, and so it's benefiting from that market. As Mary Anne shared, the adoption of the Alzheimer's DMTs is critical. Also the other point to add in is that the guidelines favor earlier diagnostic usage. That's an important component. Finally, I'll just kind of anchor down on the ability for us to work with our nuclear medicine customers from a Lantheus portfolio perspective is really advantageous for us and for our customers. I would just like to add that.

Ladies and gentlemen, there are no further questions at this time. Thank you for participating in today's conference. This concludes the program. You may disconnect and have a wonderful day.