VERU

Good morning, ladies and gentlemen, and welcome to Veru Inc.'s Investors Conference Call. I would now like to turn the conference over to Mr. Sam Fisch, Veru Inc.'s Executive Director, Investor Relations and Corporate Communications. Please go ahead.

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

Good morning. With me on this morning's call are Dr. K. Gary Barnette, the Chief Scientific Officer; Michele Greco, the Chief Financial Officer and Chief Administrative Officer; Philip Greenberg, General Counsel; and Sam Fisch, the Executive Director of Investor Relations and Corporate Communications. Thank you for joining our second quarter fiscal year 2026 earnings call. Veru is a late clinical stage biopharmaceutical company focused on developing innovative medicines for the treatment of cardiometabolic and inflammatory disease. Our drug development program consists of two novel small molecules, enobosarm and sabizabulin.

The first one, enobosarm, is an oral selective androgen receptor modulator, SARM, and it's being developed as a next generation drug that when combined with a GLP-1 receptor agonist, makes weight reduction more tissue selective for fat loss and preservation of lean mass and physical function, which is intended to lead to greater weight loss compared to a GLP-1 receptor agonist treatment alone, with a focus on older patients with obesity. Our second asset, sabizabulin, is a microtubule disruptor, and it's being developed as a broad anti-inflammatory agent to reduce vascular plaque inflammation to slow the progression or promote the regression of atherosclerotic cardiovascular disease. This morning, we'll focus on an update of the clinical development progress of enobosarm in our obesity program. We'll also provide financial highlights for fiscal 2026 second quarter ended March 31st, 2026.

GLP-1 receptor agonists have been shown to produce significant weight loss in patients who are overweight or have obesity. Unfortunately, this weight loss is tissue non-selective with the significant indiscriminate loss of both lean mass and fat mass. Of the total weight loss, up to 50% is attributable to lean mass. Although GLP-1 receptor agonist treatments have resulted in substantial weight loss for many patients, the strategy for the next generation of obesity drugs should be a combination therapy with a GLP-1 receptor agonist to cause patients to only lose fat while preserving lean mass and physical function and bone mineral density for the highest quality weight reduction. Now, Veru has focused the clinical development of enobosarm for weight loss on older patients who have obesity.

More specifically, the focus has been on older patients who have sarcopenic obesity, which means they have both obesity and low muscle mass and are potentially at the greatest risk for reaching a critically low muscle mass, which may lead to physical function decline when taking the currently approved GLP-1 receptor agonist. According to the European Working Group on Sarcopenia in Older People 2, sarcopenia is defined by reduced muscle strength and function as the primary diagnostic criterion, confirmed by low muscle quantity and quality, while the impaired physical performance reflects disease severity. As you can see, the working group emphasis is on physical strength and function, thus muscle loss alone does not define sarcopenia. As a consequence, we have chosen to also objectively evaluate and measure physical function by a stair climb test in the phase II QUALITY clinical study.

Now, Veru has completed the phase II-B QUALITY clinical trial with a multicenter, double-blind, placebo-controlled, randomized dose finding clinical trial designed to evaluate safety and efficacy of enobosarm 3 mg, enobosarm 6 mg or placebo as a treatment to augment fat loss and prevent muscle loss. The efficacy dose finding active weight loss portion of the phase II-B clinical trial was completed at 16 weeks. Participants continued into a phase II-B maintenance extension study where all patients discontinued semaglutide treatment but continued receiving either placebo. As I mentioned, Veru focused on the impact of weight loss on physical function, not just lean mass in older patients with obesity in the phase II-B QUALITY clinical study. Physical function was measured by the stair climb test, which is a common activity of daily living.

Decline to physical function as measured by the stair climb test may predict in older patients a higher risk for mobility disabilities, gait difficulties, falls and bone fractures, hospitalizations, and mortality. It has been reported that stair climb power declines by 1.38% annually with aging. Now, it should be noted that the phase II-B QUALITY clinical study is the first human study to demonstrate that the weight reduction in older patients who have obesity receiving a GLP-1 receptor agonist puts them at a higher risk for accelerated loss of lean mass with physical function decline. A 10% loss as it represents loss of stair climb power that would naturally occur with aging over a seven to eight-year period in older patients.

In a phase II-B QUALITY study, the loss of lean mass mattered as 44.3% of patients on placebo plus semaglutide group had at least a 10% decline in stair climb power physical function at 16 weeks. What happened to the study group that received enobosarm in combination with a GLP-1 receptor agonist? In the phase II-B QUALITY clinical study, enobosarm treatment preserved lean mass, which translated into a reduction in the proportion of patients that had a clinically significant stair climb physical function decline when compared to patients receiving a GLP-1 receptor alone.

More specifically, the enobosarm 3 mg plus semaglutide group had a statistically significant and clinically meaningful 59.8% relative reduction in proportion of patients that lost at least 10% stair climb power compared to the placebo plus semaglutide group, and that P value is 0.0006. In the enobosarm 6 mg group, plus semaglutide, there was a 44.1% relative reduction in the proportion of patients with at least a 10% decline in stair climb study. We believe there's an urgent unmet need for a drug that prevents the loss of muscle and physical function, as well as augments the loss of fat for greater weight loss in at-risk older patients with sarcopenic obesity receiving a GLP-1 receptor agonist for weight reduction.

The next important question is can you potentially have greater weight loss by adding enobosarm to a GLP-1 receptor agonist treatment? First of all, as the phase II-B QUALITY clinical studies demonstrated, patients receiving enobosarm had greater fat loss. Plus, if you're able to preserve muscle and physical function with enobosarm while taking a GLP-1 receptor agonist, we would expect that more calories will be burned, which is expected to result in greater weight loss compared to a GLP-1 receptor agonist alone, especially in a longer study. Let's turn to the current progress of our phase II-B plateau clinical study. A common clinical and therapeutic challenge with GLP-1 receptor agonist treatments is that 88% of patients after one year on a GLP-1 receptor agonist hit a weight loss plateau where they stop losing additional weight.

Based on the SURMOUNT-1 study conducted by Eli Lilly and Company, 62.6% of these patients unfortunately still had clinical obesity at the time they reached this weight loss plateau of one year. One explanation might be that the loss of muscle caused by non-selective tissue weight loss may reach a point that now stimulates the appetite in patients receiving a GLP-1 receptor agonist, so they consume more calories, which in turn may cause patients to stop losing weight and hit that weight loss plateau. enobosarm has been shown in clinical studies to directly burn fat and to preserve muscle to increase physical function and burn more calories. By preserving muscle, appetite stays suppressed while more calories are burned, which can help to break through the weight loss plateau, leading to incremental weight reduction.

Now let's turn to the design of the phase II-B QUALITY clinical study, which is a double-blind, placebo-controlled study to evaluate the effect of enobosarm 3 mg on total body weight, fat mass, lean mass, and physical function, bone mineral density, and safety in approximately 200 older patients aged greater than or equal to 65 who have obesity, BMI greater than or equal to 35, and are initiating semaglutide Wegovy GLP-1 receptor agonist treatment for weight reduction. The primary efficacy endpoint of the study is percent change from baseline in total body weight at 68 weeks. An interim analysis will be conducted at 36 weeks to assess the percent change from baseline in lean body mass and total fat mass as measured by DEXA scan.

The key secondary endpoints for the overall study are total fat, total lean mass, physical function, again measured by stair climb test, mobility disability assessment, bone mineral density, and patient-reported outcome questionnaires for physical function, HbA1c, and insulin resistance. The objective of the phase II-B plateau clinical trial is to focus on the effects of longer-term GLP-1 receptor agonist treatment in older patients who have obesity. The phase II-B plateau clinical study will also assess the ability of enobosarm to break through the weight loss plateau observed in patients receiving a GLP-1 receptor agonist treatment. To achieve clinically meaningful incremental weight reduction, as well as to preserve muscle mass and physical function by 68 weeks. The interim analysis of the clinical study will occur when all patients have been treated for 36 weeks.

Now, semaglutide was selected as a GLP-1 receptor agonist for the phase II-B plateau study to build on Veru's previous clinical experience using enobosarm in combination with semaglutide in the positive phase II QUALITY clinical study. Further, the clinical data from the phase II-B plateau clinical study using injectable semaglutide may support the use of oral semaglutide and oral enobosarm fixed dose combination in future phase III clinical studies. Contrast, there are no approved oral formulations for tirzepatide. On the March 9th, 2026, we announced the enrollment of the first patients in the phase II-B plateau clinical study. I'm very pleased with the current enrollment rate, and we're on track for results of the 36 interim analysis, which is expected in Q1 calendar year 2027. Now Veru is targeting the at-risk older patients with sarcopenic obesity.

How large is that market? How about the total market for obesity? The Wall Street Journal reported last week that there are more than 1 billion people in the world with obesity. The World Health Organization estimates that there are 2.5 billion adults globally who are either overweight or obese, with the rate of adult obesity more than doubling since 1990. Right now, there are only two companies, Lilly and Novo Nordisk, that together are treating less than 2% of them. How about the total market for sarcopenic obesity? The overall prevalence of obesity and low muscle mass is almost 30 million adults in the U.S. How about the total market of patients who are 65 years and older with obesity?

The prevalence of obesity in patients who are 65 years and older is 41.5% among the 47.4 million patients enrolled in Medicare Part D plans. That's about 20 million potential patients. As you can see, taken together, the market opportunity for enobosarm in combination with GLP-1 receptor agonist in older patients with sarcopenic obesity is very large. I will now turn the call over to Michele Greco, CFO, CAO, to discuss the financial highlights. Michele.

Thank you, Dr. Steiner. Let's review the results for the three months ended March 31st, 2026. Research and development costs decreased to $3.1 million from $3.9 million in the prior quarter. The decrease is primarily due to wind down of the phase II-B QUALITY clinical study for enobosarm as a treatment to augment fat loss and prevent muscle loss, which was completed during fiscal 2025. Personnel costs also decreased primarily due to the reduced share-based compensation expense. Selling, general, and administrative expenses were $4.1 million compared to $5.2 million in the prior quarter. The decrease is primarily due to a decrease in the share-based compensation expense.

We recognized a gain on the sale of ENTADFI assets of $974,000 in the prior year's quarter, which is based on non-refundable consideration received related to promissory notes previously due to Veru. As the promissory notes are now settled, no additional gain is expected in future periods. During the prior fiscal year, the company entered into a settlement agreement with Onconetix , which included payment of Series D preferred stock and warrants. During the current period, the increase in fair value of the equity securities received was $3.9 million as a result of the realized gain from the conversion of the preferred stock and then sale of the underlying common stock and change in the fair value of the remaining preferred stock and warrants.

Favorable anti-dilution provisions triggered by the Onconetix reverse stock split during the period contributed to the increase in the fair value. The bottom line result for continuing operations was a net loss of $3.1 million, or $0.13 per diluted common share, compared to a net loss of $7.9 million, or $0.54 per diluted common share in the prior year's quarter. During the quarter, the company recognized an additional gain on sale of the FC2 business of $351,000 for the net proceeds received from Clear Future in the settlement of a dispute related to a pre-closing tax receivable and liability. All direct revenues, costs, and expenses related to the FC2 Female Condom business are classified within loss from discontinued operations net of tax in the statement of operations.

Net loss was $2.7 million or $0.12 per diluted common share, compared to a net loss of $7.9 million or $0.54 per diluted common share in the prior quarter. Turning to the results for the six months ended March 31st, 2026. Research and development costs decreased to $4.5 million from $9.6 million in the prior period. The decrease is primarily due to a wind down of the phase II-B QUALITY clinical study for enobosarm as a treatment to augment fat loss and prevent muscle loss, which was completed during fiscal 2025. Personnel costs also decreased primarily due to the reduced share-based compensation expense. Selling general administrative expenses were $8.2 million compared to $10.4 million in the prior period.

The decrease is primarily due to a decrease in the share-based compensation expense. We recognized a gain on the sale of the ENTADFI assets of $1.7 million in the prior period. In conjunction with the sale of the FC2 Female Condom business during the prior fiscal year, we recorded a gain on extinguishment of debt of $8.6 million related to the termination of the SWK Holdings residual royalty agreement. During the current period, the company recorded a gain of $3.8 million from the increase in the fair value of equity securities compared to a loss from the decrease in fair value of equity securities of $0.3 million in the prior period.

The increase in fair value of the equity securities during the current year period is the result of a realized gain from the conversion of the Onconetix preferred stock and sale of the underlying common stock and change in fair value of the remaining preferred stock and warrants. Favorable anti-dilution provisions triggered by the Onconetix reverse stock split during the period contributed to the increase in fair value. The bottom line results for continuing operations was a net loss of $8.4 million or $0.39 per diluted common share, compared to a net loss of $9.6 million or $0.66 per diluted common share in the prior period.

The net loss was $8.1 million or $0.38 per diluted common share, compared to a net loss of $16.8 million or $1.15 per diluted common share in the prior period. Looking at the balance sheet. As of March 31st, 2026, our cash equivalents, and restricted cash balance was $27.6 million compared to $15.8 million as of September 30th, 2025. On both March 31st, 2026 and September 30th, 2025, there was $0.1 million of restricted cash related to the sale of the FC2 Female Condom business. Our net working capital was $28 million on March 31st, 2026, compared to $11.1 million on September 30th, 2025.

On October 31st, 2025, Veru completed an underwritten public offering of 1.4 million shares of our common stock, pre-funded warrants to purchase up to 7 million shares of our common stock, accompanying Series A warrants to purchase up to 8.4 million shares of our common stock, and accompanying Series B warrants to purchase up to 8.4 million shares of our common stock at a public offering price of $3 per share of common stock and the accompanying Series A and Series B warrants. Net proceeds to the company from this offering were approximately $23.4 million after deducting underwriting discounts and commissions and costs paid by the company. The company is not profitable and has had negative cash flows from operations.

Based on the company's current operating plan, our cash as of the issuance date of these financial statements is expected to be sufficient for the company to fund operations beyond the interim analysis in the phase II-B clinical study that would be performed to assess percent change from baseline in lean body mass and fat mass as measured by DEXA scans. During the six months ended March 31st, 2026, we used cash of $15.1 million for operating activities, compared with $19.1 million used for operating activities in the prior period. We generated cash from investing activities of $3.5 million for the six months ended March 31st, 2026, compared to $18.4 million in the prior period.

The cash generated during the current period represents proceeds from the sale of the Onconetix equity securities of $3.2 million and $0.3 million for the settlement of a dispute related to pre-closing tax matters related to the sale of the FC2 business. The cash generated in the prior period relates to proceeds from the sale of the FC2 Female Condom business of $16.3 million, proceeds of $1.7 million from the sale of ENTADFI assets, and proceeds of $393,000 from the sale of equity securities. Net proceeds provided by financing activities for the six months ended March 31st, 2026 was $23.4 million, which were the proceeds from the sale of common stock and warrants in an underwritten public offering, net of commissions and costs.

We used cash and financing activities for the 6 months ended March 31st, 2025 of $4.2 million related to the change of control payment to SWK pursuant to the residual royalty agreement, which terminated in conjunction with the sale of the FC2 Female Condom business. I'd now like to turn the call back to Dr. Steiner. Dr. Steiner?

Thank you, Michele.

Q&A session. To ask a question, you may press star then one on your telephone keypad. If you are using a speakerphone, we ask that you please pick up your handset before pressing the keys to ensure the best sound quality. To withdraw your question, please press star then two. Please limit yourself to one question and one follow-up. If you have further questions, you may re-enter the question queue. Once again, that's star then one to rejoin the question queue. We will pause momentarily to assemble our roster. The first question today comes from Leland Gershell with Oppenheimer. Please go ahead.

Hey, good morning. A couple of questions from us. Assuming success in the Plateau study, would you expect to need two phase IIIs, or could you perhaps get by with one pivotal and perhaps use Plateau as supportive? Also wanted to ask in further studies with enobosarm Given the development of evolving agents for obesity, you know, some orals are coming through. Others want to know if the design would capture those agents as well. Would the ultimate label be agnostic to the primary weight loss agent? Would you need to study the specific weight loss agents to have those reflected in the indication label for an enobosarm? Thank you.

Thank you, Leland Gershell. The first question is basically, if we're successful, you know, what is the next step? Do you go to a phase III? Let's be very clear what that means. As you know, the FDA has come back and told us that incremental weight loss of greater than 5% for the efficacy portion of the study is sort of the anchor. Okay. If you have greater than 5%, that stands on its own. If you wanna add the function benefits and the bone benefits, then you have to show those separately. You at least you're moving forward with incremental weight loss.

If your incremental weight loss is less than 5%, then you have two ways to move forward. One is physical function as a primary endpoint. The reason the phase II-B is so important is because we're doing a lot of work on physical function to make sure that we have a very clear understanding of the phase III endpoint for physical function as a claim. Furthermore, if we're collecting bone mineral density information, as you know, the FDA has recently reported back in December of 2025 that BMD alone can be a surrogate endpoint in place of fractures. That could be very interesting, as we know GLP-1s can cause bone loss. 5%, then that'll be the primary endpoint with function and BMD as secondary endpoints.

If incremental weight loss is less than 5%, you have two ways forward. One is a functional endpoint, and BMD or BMD alone. That's why this trial is so critical. It's a perfect trial because it's measuring all these things and body composition that can inform us on what the phase III programs would look like. If you notice, all the competitors are still in phase II, working out dose, working out safety, working out, you know, which direction they're gonna take. This is not just for enobosarm. Myostatin inhibitors, if you wanna have incremental weight loss and function and BMD, you have to measure those all separately, and they have to be separate claims.

You have to make sure you have the data to do that. We're the only company that really is focused on function with a very objective measurement. That's why this trial will be interesting. As you know, we've de-risked a lot of it with the phase II QUALITY study that we've done. The problem with the QUALITY study is 16 weeks, and you need more than that time to see weight loss, incremental weight loss. So we're doing the definitive study to answer that question. To answer your second question, yes.

The field is Which, just to refresh everybody's memory, second question is, you know, if we do move forward, and we've got all these co-companies coming out with weight loss agents, orals and non-orals, you know, is the claim gonna be an enobosarm with any GLP-1 receptor agonist, or the studies have to be specific to the GLP-1 receptor agonist in the form or the formulation of that agonist? The answer is, my understanding is that certainly initially it's gonna be based on the specific GLP-1 receptor agonist. That's why it's important for us to focus on, you know, semaglutide or initially.

I think since each of these GLP-1 receptor agonists have different effects on weight loss, that you're probably going to have to do, whether it's us or anybody else, you're probably going to have to combine it with the specific weight loss agent initially, and then we'll see what happens to the field later. It may get to a point that, you know, GLP-1 alone or GLP-1 GIP alone. Initially it's my opinion it's going to be specific to the GLP-1 receptor agonist. Gary Barnette is on the call. He's our Chief Scientific Officer. What do you think about that question, Gary?

Yeah, it's a great question. I think that, at some point I can envision Remember, the consequence that we're treating with enobosarm, is weight loss. Weight loss occurs with all of the GLPs and all of the incretins, and all of them will have a similar issue with the loss of lean mass and the plateau that we're addressing in the plateau study. I think that I can see a world where we include multiple different incretins as in our phase III. Mitch is exactly correct. You know, the FDA's longtime mantra is you get in your label what you study in your phase III.

Right now, our plan is to really focus on one or two incretins in the phase III program.

Okay. Thank you.

Ladies and gentlemen, this concludes our Q&A session. I would like to turn the conference back over to Dr. Mitchell Steiner for any closing remarks.

Thank you, operator. I appreciate everyone who joined us on today's call. I look forward to updating all of you on our progress on our next investor's call. Have a great day.

The digital replay of the conference call will be available beginning approximately 12:00 P.M. Eastern Time today, May 13th, by dialing 18556699658 in the U.S. and 14123170088 internationally. You will be prompted to enter the replay access code, which will be 8826955. Please record your name and company when joining. The conference call has now concluded. Thank you for attending today's discussion.

Good morning, ladies and gentlemen, and welcome to Veru Inc. Investors Conference Call. All participants will be in listen-only mode. Please note this event is being recorded. I would now like to turn the conference call over to Mr. Sam Fisch, Veru Inc. Executive Director, Investor Relations and Corporate Communications. Please go ahead. Good morning. The statements made on this conference call may be forward-looking statements. Forward-looking statements may include, but are not necessarily limited to, statements of the company's plans, objectives, expectations, or intentions regarding its business, operations, regulatory interactions, finances, and development and product portfolio. Such forward-looking statements are subject to known and unknown risks and uncertainties, and our actual results may differ significantly from those projected, suggested, or included in any forward-looking statements. Risks that may cause actual results or developments to differ materially are contained in our 10-Q and 10-K SEC filings as well as in our press releases from time to time. I would now like to turn the conference call over to Doctor Mitchell Steiner, Veru Inc.'s Chairman, CEO, and President. Good morning. With me on this morning's call are Doctor Gary Barnett, our Chief Scientific Officer, Michele Greco, our Chief Financial Officer and Chief Administrative Officer, Phil Greenberg, General Counsel, and Sam Fisch, Executive Director of Investor Relations and Corporate Communications. Thank you for joining our first quarter fiscal year 2026 earnings call. Veru Inc. is a late clinical-stage biopharmaceutical company focused on developing novel medicines for the treatment of cardiometabolic and inflammatory diseases. Our drug development program consists of two new chemical entities, small molecules, Novosarm and sabizabulin. The first one, Novosarm, is an oral selective androgen receptor and is being developed as a next-generation drug that, when combined with a GLP-1 receptor agonist, as demonstrated in our company's recently completed Phase 2 quality study, makes weight reduction more tissue selective, focusing on fat loss and preservation of lean mass and physical function, which is intended to lead to greater weight loss compared to GLP-1 receptor agonist treatment alone, with a focus on older patients with obesity. Our second asset, cabozantinib, a microtubule disruptor, is being developed as a broad anti-inflammatory agent to reduce vascular plaque inflammation to slow the progression of and promote the regression of atherosclerotic cardiovascular disease. This morning, we will focus on the update of our obesity program and we will also provide financial highlights for fiscal 2026 first quarter ended December 31, 2025. GLP-1 receptor agonists have been shown to produce significant weight loss in patients who are overweight or have obesity. Unfortunately, this weight loss is tissue nonselective with the indiscriminate significant loss of both lean mass and fat. Of the total weight loss, up to 50% is attributable to lean mass. Although the GLP-1 receptor agonist treatment has resulted in profound weight loss for many patients, the strategy for the next generation of obesity drugs should be a combination therapy with a GLP-1 receptor agonist for patients to lose fat only while preserving lean mass and physical function and bone mineral density for the highest quality weight reduction. Veru Inc. has completed a positive Phase 2b quality clinical trial conducted on 168 older patients with obesity, providing a proof of concept that Novosarm could be that next-generation drug in combination with the GLP-1 receptor agonist to make the weight loss journey more selective for only fat loss while preserving lean mass and physical function during the active weight loss period, but also notably after semaglutide was discontinued and those on monotherapy significantly prevented the regain of both body weight and fat mass such that by the end of the 28-week study, there was greater loss of fat mass while preserving lean mass for higher quality weight reduction compared to the placebo group. In September 2025, we announced a successful FDA meeting providing regulatory clarity for the development of Novosarm in combination with GLP-1 receptor agonist for greater quality weight loss in the treatment of obesity. According to FDA feedback, there are at least two possible regulatory pathways for the development of the Novosarm in combination with GLP-1 receptor agonist treatment for obesity with preservation of lean mass, which are based on incremental weight loss. First, incremental weight loss with at least a 5% placebo-corrected weight loss difference at 52 weeks of maintenance treatment with Novosarm in combination with GLP-1 receptor agonist treatment compared to GLP-1 receptor agonist treatment alone may be an acceptable primary endpoint to support efficacy for approval. Second, if the incremental weight loss is less than 5% corrected weight loss, including similar weight loss at 52 weeks maintenance treatment with Novosarm in combination with GLP-1 receptor agonist treatment compared to GLP-1 receptor agonist treatment alone, but the Novosarm treatment group demonstrates a clinically significant positive benefit such as a statistically significant and clinically meaningful benefit in the preservation of physical function, this may also be acceptable to support efficacy for approval. FDA also confirmed that Novosarm three milligrams is an acceptable dosage for future Veru Inc. clinical development. Now coincidentally, on December 19, 2025, the FDA announced that total hip bone mineral density, that's BMD, assessed by DEXA scan qualifies as a validated surrogate endpoint for drug development in postmenopausal women with osteoporosis at risk for fracture instead of the current standard that requires Phase 3 clinical studies must use bone fractures as a primary endpoint. This is relevant for our Novosarm Obesity program as it's been reported in the scientific literature that GLP-1 receptor agonist therapy affects body composition by also reducing hip BMD. In fact, the semaglutide Wegovy FDA label has recently been updated to include the safety concern of increased risk of hip and pelvic fractures based on the SELECT cardiovascular trial, which is sponsored by Novo Nordisk in over 17,000 subjects. In the SELECT trial, four to five times more hip fractures of the hip and pelvis were reported on Wegovy than in placebo in female patients and in all patients aged 75 and older. The good news for our Novosarm obesity program is that in previously published preclinical studies and rat models of postmenopausal female osteoporosis, Novosarm has been shown to have both anabolic and anti-resorptive activities that resulted in increased bone mineral density. Consequently, this means that distinct from incremental weight loss, or muscle preservation and physical function as primary endpoints, improving BMD in postmenopausal women with obesity receiving a GLP-1 receptor agonist who also have osteoporosis could be another primary endpoint going forward for Novosarm to seek regulatory approval for improving body composition. Now let's turn to the current status of our planned Phase 2b PLATO clinical study. A common and serious clinical and therapeutic challenge of GLP-1 receptor agonist treatments is that 88% of patients with obesity after one year on GLP-1 receptor agonist drug hit a weight loss plateau with a stop losing additional weight. This is based on the Cervant 1 study conducted by Eli Lilly and Company. Unfortunately, 62.6% of these patients still have clinical obesity at the time they reach the weight loss plateau. One explanation might be that the loss of muscle stimulates appetite in patients receiving a GLP-1 receptor agonist to consume more calories, which may be an important reason why patients hit that weight loss plateau. Novosarm has been shown in clinical studies to directly burn fat, preserve muscle, increase physical function, and burn more calories, which would help break through the weight loss plateau leading to incremental weight reduction. Veru Inc.'s planned Phase 2b PLATO clinical study is a double-blind placebo-controlled study to evaluate the effect of Novosarm three milligrams on total body weight, fat mass, lean mass, physical function, bone mineral density, and safety in approximately 200 older patients aged greater than or equal to 65 years of age who have obesity with a BMI of greater or equal to 35 and are initiating semaglutide treatment for weight reduction. The primary efficacy endpoint of the study is the percent change from baseline in total body weight at 68 weeks. An interim analysis will be conducted at 34 weeks to assess the percent change of baseline in lean body mass and fat mass as measured by DEXA scan. The key secondary endpoints of total fat mass, total lean mass, physical function using the Stair Climb test, bone mineral density, and a patient-recorded outcome questionnaires for physical function, HbA1c, and insulin resistance. Semaglutide was selected as a GLP-1 receptor agonist for the Phase 2b PLATO study to build on Veru Inc.'s previous clinical experience using Novosarm in combination with semaglutide in the Phase 2 quality clinical study. Further, there's now an oral form of semaglutide which may be used in combination with oral Novosarm in future Phase 3 clinical studies, making the potential bridging of the future Phase 3 clinical studies data to the Phase 2b PLATO Novosarm plus injectable semaglutide data possible. In contrast, tirzepatide injectable does not have an oral formulation. The principal investigator for the Phase 2b PLATO clinical trial will be again Steven Heimsfield, MD, Professor and the Director of the Body Composition Metabolism Laboratory at the Pennington Biomedical Research Center in Baton Rouge, Louisiana. The clinical study is expected to begin this quarter. An interim analysis to assess change in lean body mass and fat mass measured by DEXA will be conducted at 34 weeks, which is anticipated to be in 2027. I will now turn the call over to Michele Greco, CFO and CEO, to discuss the financial highlights. Michele?

Thank you, Doctor Steiner. On October 31, 2025, Veru Inc. completed an underwritten public offering of 1,400,000 shares of our common stock, pre-funded warrants to purchase up to 7,000,000 shares of our common stock, accompanying Series A warrants to purchase up to 8,400,000 shares of our common stock, and accompanying Series B warrants to purchase up to 8,400,000 shares of our common stock at a public offering price of $3 per share of common stock and the accompanying Series A and Series B warrants. Net proceeds to the company from this offering were approximately $23,400,000 after deducting underwriting costs and discounts paid by the company. In the prior year period, on December 30, 2024, Veru Inc. sold the FC2 female condom business to Clear Future Inc. In our financial statements, all direct revenues, costs, and expenses related to the FC2 Female Condom business are classified within loss from discontinued operations net of tax in the statements of operations. Now let's review the results for the three months ended December 31, 2025. Research and development costs decreased to $1,300,000 from $5,700,000 in the three months ended December 31, 2024. The decrease is primarily due to a wind-down of the Phase 2b quality clinical study for Novosarm as a treatment to augment fat loss and prevent muscle loss, which was completed during fiscal 2025. General and administrative expenses were $4,100,000 compared to $5,200,000 in the prior quarter. The decrease is primarily due to a decrease in share-based compensation. We recognized a gain on the sale of NTAPI assets of $695,000 in the prior quarter, which is based on nonrefundable consideration related to promissory notes previously due to Veru Inc. As the promissory notes are now settled, no additional gain is expected in future periods. In conjunction with the sale of the FC2 Female Condom business, we recorded a gain on extinguishment of debt of $8,600,000 in the prior year's quarter related to the termination of the residual royalty agreement. During the prior fiscal year, the company entered into a settlement agreement with On Kinetic Inc., whereby the company received a cash payment of $6,300,000 in Series D preferred stock and a warrant, which had a combined fair value of $2,500,000. The loss associated with the change in fair value of securities held related to On Kinetics was $100,000 compared with $300,000 for the prior period. The bottom line result was a net loss of $5,300,000 or $0.26 per diluted common share, compared to a net loss of $8,900,000 or $0.61 per diluted common share in the prior year's quarter. For the prior period's quarter, the net loss included a net loss of $7,100,000 from discontinued operations. Now looking at the balance sheet. As of December 31, 2025, our cash, cash equivalents, and restricted cash balance was $33,000,000 compared to $15,800,000 as of September 30, 2025. On both December 31, 2025, and September 30, 2025, there was $100,000 of restricted cash related to the sale of the FC2 female condom business. Our net working capital was $29,700,000 as of December 31, 2025, compared to $11,100,000 as of September 30, 2025. The company is not profitable and has had negative cash flow from operations. Based on the company's current operating plan, our cash as of the issuance date of these financial statements is expected to be sufficient for the company to fund operations through the interim analysis in the Phase 2b PLATO clinical study to assess percent change from baseline in lean body mass and fat mass as measured by DEXA scan. During the three months ended December 31, 2025, we used cash of $6,200,000 for operating activities, compared with $11,300,000 used for operating activities in the prior period. There was no cash generated from investing activities in the current period. For the three months ended December 31, 2024, we generated cash from investing activities of $17,200,000, primarily from proceeds from the sale of the FC2 female condom business of $16,200,000. Net cash provided by financing activities for the three months ended December 31, 2025, was $23,400,000, which were the proceeds from the sale of common stock and warrants in an underwritten public offering net of commissions and costs. We used cash in financing activities for the three months ended December 31, 2024, of $4,200,000 related to the change of control payment to SWK pursuant to the residual royalty agreement terminated in conjunction with the sale of the FC2 female condom business. Now I'd like to turn the call back to Doctor Mitchell Steiner. Doctor Steiner?

Thank you, Michele. With that, we'll now open the call to the question and answer session. Our first question comes from Edward Nash with Canaccord. Please go ahead. Hey, good morning, guys. Thanks so much for taking my question. I wanted to first just add just a couple of questions. One was why not use the oral semaglutide in this study as opposed to having the optionality in the Phase 3? Is it just because of its relatively new now, its lack of real-world data? I think the reason is that trying to minimize potential difference between what we saw in the Phase 2b quality study and what we want to see in the PLATO study. And so the oral form is not exactly the same as the injectable. The injectable is a little bit better. So that means that if we show what we need to show in the Phase 2b PLATO study, then we should see even better response with an oral semaglutide that doesn't do as well as the injectable. So really it's been calculated, took a step back and said, why do you want to change and add tirzepatide now? And since you created a completely different study with different outcomes potentially. We're trying to be safe as we move towards now. With that said, it's, you know, somatostatin is the active ingredient in both the injectable and the oral. And so that could be easily bridged and what you're trying to bridge is not the efficacy, because we're going to be testing the efficacy in the Phase 3, which you want to bridge is into all the safety. And you should be able to do that. Got it. Thank you. And just one follow-up is on the with regards to the function aspect, functional aspect of the FDA allowing that as a potential approval path preservation of function. Did you guys specifically discuss with the agency about stair climb test and the specific questionnaires that you're looking to employ to determine whether or not they consider those to be sufficient for that endpoint? Yeah. So we did speak to the agency specifically about stair climb. As you know, we've done five now with the quality studies, six studies previously done with Novosarm and done by our company here at Veru Inc. with 1,000 patients using StairClimb. So we have twenty years of experience with StairClimb. And it's not just talking to the agency with this trial and other trials, also every major scientific group. And stair climb still comes out as the best way to measure what's happening in this patient population. It's most sensitive to declines and it's very sensitive to anabolic intervention. With that said, the main comments that the FDA brought up was in the conduct of the study, they wanted to make sure that we did duplicate stair climb runs. In other words, the patient goes up the stairs once and goes up a second time and then you average that. And they also wanted to make sure that in addition to loaded that we did unloaded. What that means is that when a patient goes up the stairs, they unload it means they just go up just as they are. Loaded means that you add a backpack with some weight and the concept there is just kind of clever is we're trying to normalize weight. And the way you normalize weight is that you just add back the weight that they lost when they come back to that final visit. And you do that with the plates. And so this way, you're actually measuring and challenging the patient's muscle. So that's why it becomes such a sensitive measure of intervention. And so we had those kinds of discussions with the FDA. What's open is and what we're going to focus on in the PLATO study is also what happens with the patient-reported outcomes and how the patient-reported outcomes help to further define how patients function and feel. And so that's why the Phase 2 makes more sense than jumping into a Phase 3 because that will help with the clinical meaningfulness of what we're actually measuring objectively. Got it. Thank you very much. And the next question comes from Rohan Mathur with Oppenheimer. Please go ahead. This is Rohan on for Leland. Thanks for the question. I just wanted to ask on the interim analysis plans. Are there any pre-specified decision rules with respect to futility or alteration of the sample size that are part of the criteria there? Thank you. Sure. So I have Doctor Gary Barnett, our Chief Scientific Officer. And Gary? Yes. No, there is no futility analysis or sample size re-estimation associated with this interim analysis. And as you know, the primary endpoint is weight loss. And so the interim analysis is looking at lean mass and fat mass. And so the real purpose of it is to gain confirmation that we're heading in the right direction, meaning that you're seeing the lean mass preservation and the additional fat mass loss that would at 34 weeks, that should translate to 68 weeks, a weight loss benefit. And so from a statistical standpoint, by not looking at total weight loss, plus it's too early anyway, at 34 weeks, you're not taking a statistical penalty or an alpha hit at the interim, which will affect the amount of alpha spend you have at the end of the study. Got it. And just one more for me. You go down the route of assessing functional benefit and in the case that maybe less than 5% of weight loss is observed, is there any sense for what degree of weight loss needs to be seen and is that counterbalanced by the magnitude of functional benefit? Yes. So as I said in my public statements, that question has come up before. So greater than 5% alone is weight loss, incremental weight loss you're in. If it's less than 5% and the weight loss could be similar to the GLP-1 receptor agonist, meaning that you didn't see incremental weight loss difference at all. But to show the physical function benefit, then that can be a basis for approval going forward. Understood. Thank you. Ladies and gentlemen, this concludes our question and answer session. I would like to turn the conference back over to Doctor Mitchell Steiner for any closing remarks. Thank you. I appreciate everyone who joined us on today's call and we look forward to updating you all on our progress in our next investor call. Thank you again. The digital replay of the conference call will be available beginning 12 p.m. time today, February 11, by dialing +1 855-606-658 in the US and +1 (412) 317-0088 internationally. You'll be prompted to enter the replay access code which will be 7414536. Please record your name and company when joining. The conference call has now concluded. Thank you for attending today's discussion.