Good afternoon and welcome to the ADMA Biologics First Quarter 2025 Financial Results and Business Update Conference Call on Monday, May 7, 2025. At this time, all participants are in a listen-only mode. There will be a question-and-answer session to follow. Please be advised that this call is being recorded at the company's request and will be available on the company's website approximately two hours following the end of the call. At this time, I would like to introduce the company. Please go ahead.

Welcome, everyone, and thank you for joining us this afternoon to discuss ADMA Biologics financial Results for the first quarter of 2025 and recent corporate updates. I'm joined today by Adam Grossman, President and Chief Executive Officer; and Brad Tade, Chief Financial Officer and Treasurer. During today's call, Adam will provide some introductory comments and provide an update on corporate progress, and then Brad will provide an overview of the company's first quarter 2025 financial results. Finally, Adam will then provide some brief summary remarks before opening up the call for questions. Earlier today, we issued a press release detailing the first quarter 2025 financial results and summarized certain achievements in recent corporate updates. The release is available on our website at www.admabiologics.com. Before we begin our formal comments, I'll remind you that we will be making forward-looking assertions during today's call that represent the company's intentions, expectations or beliefs concerning future events, which constitute forward-looking statements for the purposes of the Safe Harbor provisions under the Private Securities Litigation Reform Act of 1995. All forward-looking statements are subject to factors, risks and uncertainties, such as those detailed in today's press release announcing this call and in our SEC filings, which may cause actual results to differ materially from the results expressed or implied by any such statements. In addition, any forward-looking statements represent our views only as of the date of this call and should not be relied upon as representing our views as of any subsequent date. We specifically disclaim any obligations to update any such statements except as required by the federal securities laws. We refer you to the Disclosure Notice section in our earnings release we issued today in the Risk Factors section of our previously issued SEC filings and our Quarterly report on Form 10-Q for the quarter ended March 31, 2025 for a discussion of important factors that could cause actual results to differ materially from these forward-looking statements. Please note that the discussion on today's call includes certain non-GAAP financial measures, including adjusted EBITDA and adjusted net income. A reconciliation of these non-GAAP financial measures to the most directly comparable GAAP metric is available in our earnings release. With that said, I would now like to turn the call over to Adam Grossman. Adam, go ahead.

Thank you, Skyler. Good afternoon, everyone. ADMA’s momentum has carried strongly into the first quarter of 2025, demonstrating robust execution across all aspects of our business. The advantages of our vertically integrated US-based supply chain, along with our domestic commercial footprint, have proven critical in the current geopolitical and trade landscape. This strategic positioning has enabled uninterrupted operations and consistent fulfillment of demand, even in the face of escalating global tariff tensions. With our focus solely on The US. Healthcare ecosystem and completely domestic plasma sourcing, production, and distribution operations, we believe ADMA is uniquely insulated from the tariff and trade volatility potentially affecting our multinational competitors. The recent approval of our innovative yield enhancement production process marks a pivotal achievement for ADMA and is anticipated to provide 20% more bulk IG from the same starting plasma volumes. As the first US. Producer of plasma derived products to achieve regulatory approval for a novel yield enhancement process, ADMA continues to demonstrate its leadership in modernizing and advancing plasma fractionation through agile, forward thinking scientific development and execution. We commend our team for advancing this new production process from concept to approval with speed and capital efficiency. And we thank the FDA for its thorough and timely review, as well as the agency’s commitment to expanding IG access for immunocompromised patients throughout The US. With our innovative, capital efficient, and robust internal R&D engine, which we believe has been further validated with this FDA approval, we look forward to confidently advancing our R&D platform, further optimizing production capabilities and progressing novel pipeline programs, most notably SG-001, which exemplify our commitment to product and process innovation and meeting the unmet medical needs for immunocompromised patients. Our financial results for the first quarter reflect substantial growth and operational achievements. Total revenues reached $114.8…

Thank you, Adam. We issued a press release earlier today outlining our first quarter 2025 financial results. I’ll now discuss some of the key financial highlights from the first quarter. Total reported revenue was $114.8 million for the quarter ended March 31, 2025 as compared to $81.9 million for the quarter ended March 31, 2024, an increase of $32.9 million translating to 40% year over year growth. Adjusting for the aforementioned voluntary product withdrawals during the first quarter, total first quarter 2025 revenues would have been $118.6 million, representing approximately 45% year over year growth. This increase in total revenue is primarily related to increased sales of ascent if as we continue to experience increased acceptance and utilization by physicians, payers and patients. For this product, Gross profit was $61.1 million for the quarter ended March 31, 2025 as compared to $39.1 million for the quarter ended march 31, 2020 24. This gross profitability for the first quarter of 2025 translates to 53.2% compared to 47.8% for the comparable 2024 quarter. Adjusting for the aforementioned voluntary product withdrawals, first quarter 2025 adjusted gross margins would have been 54.7%. The improvement in gross margin is primarily driven by a significantly more favorable mix of higher margin IG sales in the first quarter of 2025 as compared to the first quarter of 2024, along with the operational efficiencies achieved resulting in a reduction in manufacturing costs. Adjusted EBITDA was $47.9 million for the quarter ended March 31, 2025 as compared to adjusted EBITDA of $26.4 million for the quarter ended March 31, 2024. Adjusted EBITDA for the quarter includes all non GAAP reconciliation items, including stock based compensation, depreciation, amortization, interest expense and loss on debt extinguishment. The 81% year over year growth of adjusted EBITDA was primarily due to the subst…

Thank you, Brad. Adam is building on its robust momentum with significant financial growth and operational achievements driven by our uniquely positioned US-based supply chain. Our end to end controlled and agile business model allows us to operate independently of global trade volatility, while maintaining substantial control of our integrated supply chain. We believe this is a critical advantage for ADMA in the current geopolitical climate. With recent FDA approval of our yield enhanced production process further strengthening our market position, unlocking potential opportunities for accelerated revenue and earnings growth. Successfully bringing our innovative yield enhancement process from concept through development and ultimate FDA approval, we believe further validates the robust and capital efficient internal R&D engine at ADMA, advancing both product and production innovations. As we anticipate continued demand for our commercial products and a favorable shift in our revenue mix, we remain confident in our ability to achieve sustainable revenue and earnings growth and deliver long term value to our stockholders. Looking ahead, we are excited about the potential impact of our development initiatives and the resilience of our business model, positioning ADMA as a leader in the rapidly evolving biopharma landscape. With upwardly revised 2025 and 2026 financial guidance, we see a clear path to expanding our market presence and capitalizing on the opportunities within our pipeline. Together, we believe we are poised to drive meaningful advancements in healthcare, underscoring our commitment to innovation and excellence and ultimately unlocking continued stockholder value. With that, I’d now like to open up the call for your questions. Operator?

Thank you. [Operator Instructions]. And the first question comes from Anthony Petrone with Mizuho. Your line is now open.

Thanks, good afternoon, everyone and congrats here on a really strong start to the year and the recent FDA clearance on yield enhancement. I know it was a big lift for the team. Intrigued by the guidance here, Adam, raising the range once again here. $10 million in 2025, $20 million next year. But importantly, not including yield enhancement, our understanding is you needed to manufacture I think at least several batches at the higher yield run rate to secure FDA clearance and that with FDA clearance you could release those into the marketplace. So maybe just to recap how much was prepared to secure FDA clearance and when do you think those lots could actually begin contributing to revenue? And I'll have a couple of follow ups.

Sure. Thanks, Anthony, very much. We appreciate the support. So you’re exactly right. In order to have this FDA prior approval supplement approved, we manufactured three conformance lots at the commercial scale, two were BIVIGAM, one are ASCENIV. We’ve expressly excluded this from 2025 guidance altogether. We take the same conservative approach to guidance that we always have. I feel confident that we should be able to have these lots labeled, packaged, and released. But we are looking at this conservatively. We want to sell down all of the, call it, the old process, the 4,400 liter scale produced product first. We want to make sure that all of that product is out of inventory. And based on forward looking demand trends for ASCENIV and BIVIGAM, we feel confident that we certainly have a good shot on goal. And you could see us take the same approach that we’ve always taken, which is when we have that visibility, we’ll increase guidance. And we feel very, very good about our position right now. We are currently manufacturing at the yield improvement scale. So we feel really good about that. We’re implementing that extremely rapidly, and hats off to the team here for getting it done. But same conservative approach, Anthony. We’d rather under promise and over deliver, and we feel really good about where guidance is for ’25. And ’26, we’ve taken a conservative approach to yield enhancement, again, coupled with the fact that we want to make sure that we sell out all the inventory at the old process, and you will see margins start to certainly expand rapidly throughout 2026. If everything goes well, 100% of what we’re going to sell in 2026 will be manufactured at the yield improvement scale. So if my commercial team is listening, get it on, pull it through the channel.

Lovely. Totally understood and a good approach there. Quick follow ups, I’ll hop in, let us jump in here. One is, and Brad, you mentioned this in your remarks, Adam, you alluded to it. So there is going to be some investment here, I think in demand generation for incentive, now that you have increased supply visibility. The question on this is how backlog right now is there, if you will, on incentive that you can feel sort of near term? And then how much do you think demand generation can generate? And the last quick one would be, you now have a multidisciplinary capital allocation selection. You’re talking about recapitalization of debt. You have an R&D program, pneumococcal pneumonia, and now we have a 500 million authorization. So maybe just the priorities for capital allocation going forward. Again, congratulations. Thanks.

Sure. Anthony, we feel that the OpEx is going to come down sequentially. You’re going to see the OpEx line start to normalize starting in the second quarter. We’re already halfway through the second quarter and the demand indicators for all of our products look very, very healthy and strong. We anticipate sequential growth from the top and bottom line as we progress throughout this year. Regarding our capital allocation, I mean, we feel really, really good about our forecasted forward looking cash generation and profitability outlook. The free cash flow that we’re planning to generate here, especially with yield enhanced produced product, will provide us with substantially enough cash to do all the things that you mentioned, pay down debt, fund our commercial strategy and growing the demand queue for our products, fund our R&D with SG-001 as well as we should have the money on the balance sheet to start repurchasing stock. I mean, we’re looking at this from a position of strength. The forward-looking cash generation that we’ve seen, I mean, it’s very exciting to be in this position. I’ve never felt this good about being the CEO of AdmabioLogix ever. And things are humming along here and we really feel good about this. The priorities, to put them in an order, I mean, it’s all a priority. I think we feel, Brad, that we’ve got the cash generation outlook that with the share repo in place, that’ll be under a 10b5-one plan, so we’ll put that in place. But we plan to start that in the near term. You see that we’re looking at novel ways to reduce our cost of debt, saving 1.1% we think is fantastic in this backdrop. And depending upon how the financial markets play out, we’ll make the decisions in real time. Do we pay down more debt? Do we buy back shares? But we certainly have enough cash that we are looking at generating in the forward-looking periods to support everything that we want to do with the business and more.

Yeah, Anthony, again, we’re going to continue to see revenue growth and the evolving mix shift from BIVIGAM to ASCENIV in addition to the yield enhancement, resulting in margin expansion. And that coupled with the OpEx normalization, that will translate into net income and EBITDA expansion. To Adam’s point, we feel like we are entering second quarter and the second half of 2025 from a position of strength from the balance sheet. And with the bolus of expenses associated with yield enhancement and promotional activities and medical education behind us, we feel great with those investments. And we feel, again, like we are entering Q2 in the second half from a position of strength, both on the balance sheet and P&L.

And our next question comes from Kristen Kluska with Cantor Fitzgerald. Your line is open.

Hi, this is Rick Miller on for Kristen. Thanks for taking our questions. Earlier this year, you were talking the ability through some of the new supply agreements to access around 250 centers for collection. Can you help us understand what percentage of these centers are currently contributing to the source plasma mix? And then we’ll have another one after that.

Thanks, Rick, very much. We appreciate your and Kristen’s support. With respect to the onboarding of these centers, I think substantially all of the centers are now sending in samples, and we are screening from them. We’ve really done a great job here internally. Again, hats off to our laboratory testing team for this. But we are collecting more plasma than our forecast, and we feel real good about this. That’s partially contributing to our increasing guidance for this year and next year. But we’re running on all cylinders. We are collecting more plasma than we anticipated. We’re making more ASCENIV batches. The first yield enhanced batch is an ASCENIV batch. So we feel real good about this. We are very, very pleased with how the supply is coming from our third party partners. And these contracts have really derisked the historical bottleneck and supply constraints, and we feel that we’re going be able to hit all the targets that we’re putting out there. And we certainly have shots on goal, easy shots, I think, to exceed what we are forecasting and guiding to today.

Okay. Then one more from us. Thinking about scaling ASCENIV, do you have any updated color on kind of how the strategy is going for retaining high titer donors? Any change in strategy there, how you’re going about it?

Strategy seems to be working. I mean, you compensate your donors and you make them feel good and you treat them like VIPs, they keep coming back. So we’re seeing great donor retention. We are identifying new donors all the time, and the program seems to be working extremely well. So we don’t see any need to change strategy right now. The margins for incentive are still in that mid-eighty percent gross margin range, and that is with the increased donor fees. So when you couple that with the 20% increase in bulk IG output from yield enhancement, margins for 2026 are going to grow exponentially. We’re really excited about the opportunity.

And the next question comes from Gary Nachman with Raymond James. Your line is open.

Hi, Gary. Great. Thanks. And hi, and congrats on getting the manufacturing process approval. So knowing that you’ll be able to generate 20% more yield with your plasma, are you able to release more new patients from the queue at a faster pace? Or do you need to have the finished product on hand before you do that? So how do you envision managing that in terms of the patient queue? Maybe you could just speak more generally, Adam, just following on this about how that queue has been building in terms of demand for incentives and how long before you think you’ll be able to get to most of those patients? Like, is it one year, two years? How do you think that’s going to evolve?

Well, my first gut reaction to that part of it is I hope we get to a place where there is so much demand that we can never meet it. And we’re talking about expanding capacity and growing even bigger than we are today. And that we think with new revised top line guidance prior to January If we can get there and we believe that there are more patients out there, we’re very excited for that opportunity. I can tell you that we are releasing more product than ever before. We made more product late last year, as we said on previous calls, and we have that product available starting now basically. And we’ve seen some great, great demand trends as we enter the second quarter and ended the first quarter. And we’re releasing more drug. The patient queue still exists. There are still patients waiting in line for therapy. We’re seeing robust continuation of patients on drug, and we feel very good about our ability to have more supply in the market for ASCENIV and getting more patients on therapy. You’re going to see the accounts receivable grow, and you see that number as we end the first quarter. Think cash and receivables were about $171,000,000 just about $100,000,000 of receivables. And the majority of our sales continue to be from ASCENIV, as Brad said earlier. The mix shift continues to expand with incentive being the overwhelming majority of the revenue that we are generating. And we feel really, really good. AR grew because of the timing of lot releases. We had a number of lot releases come in from FDA in the March timeframe, and the product is being pulled through at a rapid clip. So hopefully that answers your question, but the queue remains. We are adding more patients every single week, and we feel good about it. Patients continue to do well on drug therapy, and they’re staying on drug for long periods of time.

Yes, that was definitely helpful. And then, you know, there’s something that we’ve talked about in the past, but what’s the status for you to be able to generate some HEOR data demonstrating the benefits of using ASCENIV compared to standard IG products for the more severe PI patients? I think you’ve talked about maybe having that later this year. And then how would you expect to utilize that data with physicians and payers? So, maybe one, talk about how many physicians are currently using the product and how many more you think you could tap into potentially, and then from a payer standpoint that you’re comfortable that you’re not going to get the headwinds as the product continues to grow?

So we’re still on track, Gary. Health economic outcome data, pharmacoeconomic data is on track. The team is working diligently with statisticians culling all the ICD codes, and we feel good about being in a position to have something published later this year. This work that we’re doing is really designed to demonstrate the real-world evidence, and it’s resonating amongst the government pay and the commercial payers. The key driver of this project internally is to ensure that access for the drug is available from government payers and commercial payers. And we expect that any publications that we put out will continue to drive home to the commercial payer mostly that this drug, while it is sold at a premium price to standard IGs, is keeping patients out of the hospital, keeping them in work and school, allowing them to lead normal lives without the additional medical costs from other opportunistic infections and other complications that these patients experience. So we’re on track to have this data published prior to year end. And as soon as we’ve got something to announce, we will certainly put out a press release for the market.

Okay, excellent. And then just two more quick ones. Just explain the voluntary product withdrawals in 1Q, why that occurred? And does that product come back at some point or it’s basically just gone? And then also just your comment on extending the IP of incentive beyond 2035, just the type of, I guess, tools that you have to potentially do that. Is this new manufacturing process one of those tools? And when do you think we might hear about that longer durability? Thank you.

Sure. So I’ll touch your first question first. These are inherent adverse events that patients experience. It’s labeled in the package insert. And these are known adverse events that you experience with IG. We were not alone in the quarter. Other manufacturers of IG, you can see on the FDA website, also had recalls. We look at it as a one-time nonrecurring occurrence here that in the interest of public safety, we voluntarily remove the product from the market. First and foremost, and I’ve said this since ADMA was founded, our mission here is to provide safe, efficacious product to patients, to keep the FDA happy. And we’re going to make tough decisions here that may impact our financials, but are going to ultimately do the right thing for the patients and show the FDA that we look at these things and we take them seriously. So one time occurrence here. These lots have been voluntarily withdrawn from the market. Any inventory that we had, we will destroy. Credits have been issued to customers for that product. I think it was around $3.8 million in the quarter. And this is our sixth year of commercialization of our products. It’s never happened to us before. I think pretty much all other producers, maybe say for one, have not experienced something like this throughout their manufacturing life. But we’re dealing with plasma derived biologics, and sometimes things happen. And unfortunately, it happened here, but our products are safe. We’ve got tens of thousands of grams being infused all the time, and we do not expect any further go forward impacts from the product withdrawals. Moving to your next question on IP, we’ve got a lot of science going on here. I think that’s evidenced by the approval of yield enhancement. And we’ve…

Yes, no, that call is really helpful and that durability is really important, so thanks for that.

No, thank you. Good questions.

Good questions, ladies and gentlemen, this will conclude our question-and-answer portion of the call. I'd like now to turn it back over to Adam for additional closing remarks.

I just want to say thank you. Thank you to the ADMA team. Thank you to our stockholders for your continued support and for dialing in. As a US. Domicile company, we feel real good about being insulated from all of the tariff noise that’s out there. And hopefully, we’ll be in a position to continue to deliver outstanding results. So thanks very much. Stay healthy. Enjoy spring wherever you are, and have a good evening.

Ladies and gentlemen, this does conclude the conference call for today. We appreciate your participation and you may now disconnect.