Veru Inc. (VERU) Q3 2021 Earnings Report, Transcript and Summary

Good morning, ladies and gentlemen, and welcome to Veru Inc. Investors Conference Call. [Operator Instructions]. I'd now like to turn the conference call over to Mr. Sam Fisch, Veru Inc.'s Director of Investor Relations. 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, 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. I'd now like to turn the conference call over to Dr. Mitchell Steiner, Veru Inc.'s Chairman, CEO and President.

Thank you, Sam, and good morning. With me on this morning's call are Michele Greco, CFO and CAO; Michael Purvis, EVP, General Counsel and Corporate Strategy; and Sam Fisch, Director of Investor Relations. Thank you for joining our call. Veru is a late clinical stage oncology biopharmaceutical company with a focus on developing novel medicines for the management of 2 of the most prevalent cancers, prostate cancer and breast cancer. We're also committed to developing an effective drug therapy for COVID-19, which is a Phase 3 program. We invest cash generated from our Sexual Health commercial business into the clinical development of our potentially high-value oncology and COVID-19 drug candidates. This morning, we will discuss the progress of our late clinical stage prostate cancer and breast cancer drug programs as well as sabizabulin Phase 3 study for the treatment of COVID-19. We will then provide financial highlights for our record third quarter fiscal year 2021. Veru anticipates having 4 registration clinical trials in prostate cancer, breast cancer and for COVID-19 and 2 potentially registration-enabling clinical trials in breast cancer, up and running by the end of the calendar year 2021 to a total of 6 pivotal or potentially pivotal studies. 2 of these, Phase 3 VRACITY study in prostate cancer and the Phase 3 COVID-19 clinical study have already commenced. We have been very busy executing on this bold plan, and you will see that we're making significant progress. In our prostate cancer clinical program, the company has initiated is enrolling two clinical trials, a Phase 3 VERACITY study to evaluate sabizabulin for the treatment of metastatic castration and androgen receptor targeting agent resistant prostate cancer and a Phase 2 dose-finding clinical study for VERU-100, a GnRH antagonist 3-month long-acting depot delivery formulation for androgen deprivation therapy of advanced hormone-sensitive prostate cancer. Sabizabulin is an oral first-in-class new chemical entity that targets, cross links and disrupt alpha and beta tubulin subunits of microtubules to disrupt the cytoskeleton. And in prostate cancer, this also results in the disruption of androgen receptor's transport from the sinoplasm into the nucleus. The Phase 1b/2 clinical study enrolled 39 men in the Phase 1 and 41 men in the Phase 2 portion. The Phase 2 portion is completely enrolled and is still ongoing. The safety of sabizabulin appears to be similar to the androgen receptor targeted agents like abiraterone and enzalutamide, based on what has been reported in their package inserts. Long-term daily chronic drug administration appears to be feasible and safe. We have patients in the Phase 1b portion that have been on treatment for over 2 years without evidence of prostate cancer tumor progression. At the recommended Phase 2 dose of 63 milligrams, the most common adverse events were mostly grade 1 and 2 diarrhea, fatigue and nausea. There have been no clinically relevant reports of neutropenia, neurotoxicity or hair loss. The Phase 1b/2 study also has yielded promising and significant efficacy outcomes. The efficacy results show PSA declines and responses as well as objective and durable tumor responses, including partial and complete responses. For the intent-to-treat population of all men with measurable disease at baseline, which is 29, the objective tumor response rate is 21%, and all man that received 63 milligrams or greater dose of sabizabulin, which is 55 men, the median radiographic progression-free survival has not been reached as the study is still ongoing, but it's estimated to be greater than 7.4 months. We initiated this past quarter, the Phase 3 VERACITY clinical study, which is an open label, 2:1 randomization study, evaluating the efficacy and safety of sabizabulin 32 milligrams oral double dosing versus an alternative androgen receptor targeted agent in men with metastatic castration-resistant prostate cancer who have failed at least 1 androgen receptor targeted agent, but prior to IV chemotherapy. Primary endpoint is median radiographic progression-free survival. The trial assumption expects the median radiographic progression-free survival is 7.4 months for sabizabulin versus 3.7 months for the alternative androgen receptor targeted agent, which if achieved would represent a doubling in the improvement of median radiographic progression-free survival and sabizabulin-- with sabizabulin compared to the active control. The study's statistical assumptions to estimate sample size of 245 subjects included using an alpha of 0.05, a power of 98% and a dropout rate of 30%. We expect enrollment to take 10 months recruitment time and 12 months follow-up after the last patient is first dosed. The study is open and enrolling patients in 45 clinical sites across the United States. The lead principal investigator is Dr. Robert Reiser. He's a Deputy Director at the University of Virginia Cancer Center, Director of Solid Tumor Oncology and Professor of Hematology and Oncology. In summary, sabizabulin is an oral agent with a novel targeted mechanism of action that based on scientific literature and package insert has a similar safety profile as a novel androgen receptor targeted agent and sabizabulin has efficacy at least comparable to, if not better, than IV docetaxel chemotherapy in this patient population. Further, chronic oral administration is feasible. Thus, so far, it appears we have met our clinical target product profile goal of having an agent that can be prescribed prior to IV chemotherapy by both urologists and medical oncologists. Thus, sabizabulin could be potentially the next go-to drug to be prescribed in the management of men with metastatic castration and androgen receptor targeting agent resistant prostate cancer. Current global sales for androgen receptor targeted agents like abiraterone, enzalutamide and apalutamide are approaching $6 billion. Unfortunately, all men will develop resistance to these drugs and have prostate cancer progression. This means the only other option they will have is to proceed to IV chemotherapy. Thus sabizabulin, if approved, will address a large part of the metastatic prostate cancer market. Next, I will update you on VRU-100, a long-acting androgen deprivation therapy for the treatment of hormone-sensitive advanced prostate cancer. Androgen deprivation therapy is currently the main state advanced prostate cancer treatment and is used as the foundation of treatment throughout the course of the disease. Furthermore, Androgen deprivation therapy is continued even as other endocrine, chemotherapy or radiation treatments are added or stopped. Standard medical practice for urologists and medical oncologists is to administer Androgen deprivation therapy every 3 to 4 months in their office. These injections coincide with the follow-up office visits and imaging assessments for metastatic or advanced prostate cancer. Furthermore, these injections were administered as a buy-and-build product and are reimbursed on the Medicare Plan B, not-- Plan B. So the urologist is compensated for both the drug and administering the drug. Patients compliance is 100% once the injection has been administered. Therefore, most physicians strongly prefer injections over oral agents. Gonadotropin releasing hormone antagonist treatment or GnRH treatments versus agonist are preferred because castration occurs rapidly with no surges or flares in testosterone. Testosterone levels also tend to be lower, which is better for tumor control. GnRH antagonist also lower FSH levels, which is thought to be the reason why there are fewer cardiovascular side effects with GnRH antagonists versus GnRH agonist. There are no GnRH antagonist depot injection formulations currently approved for treatment beyond a 1 month duration. VERU-100 is a novel proprietary long-acting peptide, 3-month subcutaneous people formulation injection designed to address the current limitations of commercially available agents with androgen deprivation therapy. In this past quarter, we have initiated and are enrolling a Phase 2 dose-finding clinical study evaluating VERU-100 in 35 men. We expect to have clinical data to report by year-end. The open label Phase 3 registration study whose design has already been agreed upon by FDA will evaluate the efficacy and safety of VERU-100 in approximately 100 men with hormone-sensitive metastatic prostate cancer and is anticipated to start at the end of the calendar year of 2021. Next, I will discuss the progress of our breast cancer program. Veru is planning to initiate the following breast cancer studies during this half of the calendar year. In Phase 3, our test clinical study, evaluating enobosarm monotherapy in a third line metastatic setting and in women with AR positive, ER positive, HER2-negative metastatic breast cancer will progress following estrogen blocking agents and CDK4/6 inhibitor. A Phase 2b clinical study evaluating a enobosarm in combination of abemaciclib, a CDK4/6 inhibitor in a second line metastatic setting in women who have progressed following first-line palbociclib, a CDK4/6 inhibitor in combination with an estrogen blocking agent, and a Phase 2b clinical study evaluating sabizabulin monotherapy and sabizabulin plus Trodelvy combination therapy versus Trodelvy monotherapy in women with metastatic triple-negative breast cancer that have failed at least 2 chemotherapies. By way of background, the most common type of breast cancer, which occurs in about 85% of women is ER positive breast cancer, where estrogen is one of the main drivers of proliferation, tumor progression and metastasis. Consequently, treatment is to target a block estrogen receptor for the mainstay of breast cancer therapy. According to the 2020 National Comprehensive Cancer Network guidelines, to recommend its first treatment in the metastatic-- first-line treatment in the metastatic setting is either an on-store aromatase inhibitor in combination with CDK4/6 inhibitor or fulvestrant in combination with CDK4/6 inhibitor. The recommended second line treatment in a metastatic setting is fulvestrant in combination with CDK4/6 inhibitor if a CDK4/6 inhibitor was not used in the first-line in metastatic setting. Fortunately, almost all women being treated with these regimens will eventually develop resistance to estrogen blocking agents and the CDK4/6 inhibitor therapies, and there are limited clinical data that allow recommendation for a treatment containing another CDK4/6 inhibitor for these patients. Alternative treatment approaches that target novel pathways will be required as there are limited treatment options following CDK4/6 inhibitor and estrogen blocking agent resistance and the management of ER positive HER2 negative metastatic breast cancer. Interestingly, like the estrogen receptor, the androgen receptor is found in over 85% of breast cancers. The androgen receptor is a tumor suppressor, in estrogen receptive positive breast cancer. This means that when the androgen receptor is activated, it strongly suppresses ER-positive breast cancer growth. This explains why historically, when synthetic antigens were use to treat breast cancer, they demonstrated good efficacy, but unfortunately, the masculinizing side effects such as facial hair, acne, increase in hematocrit and liver toxicity have prohibited their use as a viable treatment. In contrast, enobosarm, an oral, first-in-class new chemical entity is a selective androgen receptor targeted agonist that is being developed for the treatment of AR positive, ER positive, HER2 negative metastatic breast cancer and would represent the first new endocrine therapy for advanced breast cancer in decades. Enobosarm has extensive nonclinical and clinical experience, having been evaluated in over 25 separate clinical studies involving more than 2,100 subjects, including 5 prior Phase 2 clinical studies in advanced breast cancer involving more than 250 patients. In addition to suppressing AR positive, ER positive breast cancer cell proliferation and tumor growth enobosarm has other potential beneficial clinical properties. In pre-clinical studies, enobosarm has demonstrated that it builds and heels cortical trabecular bone and therefore has the potential to treat the osteoporosis caused by the estrogen deprivation and cancer skeletal related events. Enobosarm has also been shown to build muscle and to improve physical function in clinical studies involving elderly subjects, in patients with cancer cachexia, including breast cancer patients. Furthermore, because of its tissue selectivity, enobosarm has a favorable side effect profile with no masculinisation, no increase in the hematocrit and no liver toxicity. Two positive Phase 2 studies involved in approximately 150 women with AR positive, ER positive metastatic breast cancer was conducted. The G200802 Phase 2 study was a 2-arm study that evaluated 9 and 80 milligrams of the enobosarm daily oral dosing in 136 women with AR positive, ER positive HER2 negative advanced breast cancer. Patients in the 802 study were heavily pre-treated and have in failed on average, 3-- an average of 3 estrogen blocking agents and 88% have received prior chemotherapy. In this study, clinically meaningful tumor responses were observed with the enobosarm monotherapy and it strongly establishes the relevance of targeting the androgen receptor with a selective androgen receptor agonist in women that were heavily pre-treated with estrogen blocking agents and resistant, and had AR positive, ER positive metastatic breast cancer. Enobosarm appears safe and well tolerated without masculinising effects, increasing hematocrit or liver toxicity. Quality of life measurements demonstrated overall improvement, including mobility, anxiety, depression and pain. The 9 milligram dose was selected for our Phase 3 study, and the 9 milligram cohort compared to the 80 milligram cohort had a similar tumor response at a slightly better toxicity profile. Furthermore, and most importantly, we also performed a post-hoc subset analysis of this Phase 2 clinical data to evaluate the relationship of the androgen receptor status with a enobosarm anti-tumor efficacy. The subset analysis showed that the presence of the androgen receptor and the amount of the androgen receptor expression in the breast cancer tissue predicted those women who are more likely to have a positive response to an enobosarm. More specifically, the subset analysis combined randomized subjects in both the 9 and 80 milligram cohorts who had known androgen receptor status determined by central land and we had measurable disease in those 84 subjects. The cut-off at greater than equal to 40% AR expression appears to be the best level to enrich the subjects that were most likely to respond to enobosarm. The clinical benefit rate of 24 weeks was 52% at greater than equal to 40% AR staining versus 14% for less than 40% AR staining, and that p-value was less than 0.0004. The best objective tumor response of partial responses plus complete responses was 34% at greater than equal 40% AR staining versus only 2.7% to less than 40% AR staining, and that p-value was less than 0.0003. And the median radiographic progression-free survival was 5.47 months at greater than equal to 40% AR staining versus 2.7 months for less than 40% AR staining, and that p-value is less than 0.001. Using this 40% cut-off, 57% of all women with AR positive, ER positive, HER2 negative metastatic breast cancer would qualify for treatment with enobosarm. Thus, the presence and the degree of androgen receptor expression in breast cancer tissue was important for enobosarm's anti-tumor activity, which is consistent with enobosarm being a targeted agent or biomarker that could be selected or enriched for subjects most likely to respond to a enobosarm therapy. As recommended by FDA based on these clinical data, AR expression status by immunohistochemistry will be validated as a companion diagnostic test and is a critical inclusion criterion in our clinical trial design. We are collaborating with a large global diagnostic company, which we'll announce when our agreement is complete that has the expertise to help us with the development and validation of an AR companion diagnostic test in parallel with our Phase 3R test clinical study. By targeting the androgen receptor in ER positive metastatic breast cancer, enobosarm introduces a novel endocrine therapy to patients with breast cancer that have exhausted estrogen blocking agents in CDK4/6 inhibitors, but prior to IV chemotherapy. We're developing enobosarm in 2 major indications in ER positive, HER2 metastatic breast cancer. The first indication is to evaluate enobosarm monotherapy in a third line metastatic setting. We will conduct this Phase 3R test registration study as an open label, multi-centered, multinational randomized 1:1 active control pivotal study, evaluating the efficacy and safety of enobosarm 9 milligrams daily oral dose versus an active control, which is either going to be exemestane plus or minus everolimus or serum to physician's choice in essentially confirmed greater than equal 40% AR staining, AR positive, ER positive, HER2 negative metastatic breast cancer subjects who have failed a nonsteroidal AI, fulvestrant and the CDK4/6 inhibitor. The primary endpoint is median radiographic progression-free survival. The statistical assumptions include an estimated median radiographic progression-free survival of 6 months for enobosarm monotherapy versus less than 3 months for the active control. With an alpha of 0.05, 99% power and a 20% dropout rate, the sample size will be approximately 2 as in 10 subjects. We expect enrollment to take 10 months recruitment time and 12 months follow-up after the last patient is first dosed. We expect that the androgen receptor companion diagnostic tests will be developed in parallel with the Phase 3R test study with our diagnostic company partner. The Phase 3R test study will be conducted in 49 clinical sites across the United States and Europe and is anticipated to commence soon. The second indication to evaluate enobosarm plus a CDK4/6 inhibitor combination therapy in the second line metastatic setting, we will conduct a Phase 2b clinical trial to evaluate the efficacy and safety of enobosarm plus a CDK4/6 inhibitor abemaciclib in combination versus an alternate androgen blocking agent, either fulvestrant or nonsteroidal-- either fulvestrant or aromatase inhibitor in an AR positive, ER positive, HER2-negative metastatic breast cancer patients who have failed their first line therapy, which is commonly palbociclib, a CDK4/6 inhibitor plus an estrogen blocking agent. This is an open label, 2:1 randomization clinical study in approximately 186 subjects and is expected to commence in a few months. Both of these indications represent large market opportunities as palbociclib global sales are approaching $6 billion in breast cancer. And unfortunately, almost all of these women will develop resistance to palbociclib and tumor progression. The goal is to position enobosarm as the next go-to attractive option in both the second line and third line setting for AR positive, ER positive, HER2 negative metastatic breast cancer. Next, I will update you on the third clinical study in our breast cancer program, a Phase 2b clinical study for chemotherapy resistant metastatic triple negative breast cancer. Metastatic triple negative breast cancer is an aggressive form of breast cancer that is present in approximately 15% of all breast cancers. This form of breast cancer does not express the estrogen receptor, progesterone receptor or HER2 and is resistant to estrogen blocking agents. Thus, the first-line of treatment usually consists of multiple systemic chemotherapies, including IV taxane chemotherapy. Unfortunately, almost all of these women will eventually develop resistance and exhibit tumor progression. In pre-clinical studies of human triple negative breast cancer that has become resistant to paclitaxel, which is a taxane, sabizabulin significantly inhibits cancer proliferation, migration, metastasis and invasion. We plan to initiate an open label 3-arm Phase 2b clinical trial to evaluate the efficacy and safety of oral, sabizabulin monotherapy and sabizabulin Trodelvy combination therapy versus Trodelvy monotherapy in the treatment of approximately 216 subjects in a 1:1:1 randomization in metastatic triple negative breast cancer patients who have failed at least 2 systemic chemotherapies. The primary endpoint will be objective tumor response rates to ORR in human prostate cancer trials, chronic oral daily administrations of sabizabulin is well tolerated and there was no reports of neutropenia. By the way, it was-- it will be interesting to see whether sabizabulin in combination with Trodelvy could result in less neutropenia with better efficacy, similar to what has been observed in the recently reported successful metastatic non-small cell lung cancer clinical trial with Plinabulin, an IV culturists targeted antitubulin with a similar mechanism as sabizabulin, in combination with docetaxel, prevented the docetaxel induced neutropenia, improved radiographic progression-free survival and overall survival, even compared to docetaxel. The Phase 2b clinical study is planned to commence soon. The clinical developments of sabizabulin in metastatic breast cancer represents a second major clinical oncology indication for sabizabulin. Next, we will discuss our third clinical program, sabizabulin 9 milligrams for the treatment of hospitalized patients with COVID-19, who had high-risk acute respiratory distress syndrome. sabizabulin in this setting is a novel once-daily orally dosed small molecule with both broad antiviral and anti-inflammatory activities which may serve as a two-pronged approach to the treatment of COVID-19 virus infection and the subsequent debilitating inflammatory effects that lead to acute respiratory distress syndrome and death. We conducted a double-blind, randomized, placebo-controlled Phase 2 clinical trial, evaluating once-daily oral dosing of acute respiratory distressed syndrome 80 milligrams versus placebo in 39 hospitalized COVID-19 patients who have high risk for acute respiratory distress syndrome. In the attempt to treat population, sabizabulin reduced the proportion of patients who died on study from 30% or 6 in 20 in a placebo group to 5.3%, 1 in 19 in the sabizabulin treated group, and that p-value was 0.044. This is an 82% relative reduction in mortality in sabizabulin treated group. Sabizabulin also showed significant and clinically meaningful reduction in days in the ICU of sabizabulin on average is 3 days versus placebo of 9.55 days. Sabizabulin reduced the days on mechanical ventilation from an average of 5.4 days in the placebo group to 1.6 days in the sabizabulin treated group. Sabizabulin was well tolerated with a good safety profile. We're currently enrolling a COVID-19 Phase 3 clinical trial, which is a double-blind, multi-centered, multinational, randomized 2:1 placebo-controlled trial, evaluating daily oral doses of 9 milligrams sabizabulin for up to 21 days versus placebo in 300 hospitalized COVID-19 patients, of which 200 subjects will be treated with sabizabulin and 100 subjects will receive placebo, who had high-risk for accute respiratory distress syndrome. Subjects in both the sabizabulin and the placebo arms will be allowed to receive standard of care. The primary efficacy endpoint will be proportion of patients who would die on study up to day 60. Secondary endpoints will include the proportion of patients without respiratory failure, days in ICU, WHO ordinal scale for clinical improvement, change from baseline, days on mechanical ventilation, days in the hospital and viral load. The study is being in the United States, Brazil, Argentina, Mexico and Colombia. Enrollments is on track to be completed by calendar year-end. The company has sufficient clinical drug supply on hand to complete this Phase 3 clinical study. We will-- we still are seeking funding from the Biomedical Advanced Research and Development Authority of the U.S. Department of Health and Human services, BARDA and other agencies to try to fund the estimated amount of commercial drug to supply the needs of the United States, assuming confirmatory positive clinical results and FDA approval. We believe we have the resources to conduct our planned sabizabulin for COVID-19 Phase 3 without impacting our other cancer drugs clinical development. As you're aware, we're not out of the woods with COVID-19 pandemic. COVID-19 cases, hospitalizations and tests are once again increasing in nearly all states and are fueled by the Delta variant which is much more contagious than the past versions of the virus. Other variants are still emerging. The highest spread of cases with severe outcomes is happening in places with low vaccination rates. COVID-19 infection rates and hospitalizations are at a serious level, and the CDC is reversing their recommendation back to those used during the peak of the pandemic. There's no doubt, we have had a major setback in the fight against COVID-19. It is clear that an effective and safe oral therapeutic that can prevent deaths in hospitalized patients with moderate to severe COVID-19 disease with risk or acute respiratory distress syndrome is desperately needed alongside an effective vaccination campaign. We strongly believe that sabizabulin with its anti-inflammatory and antiviral properties and its favorable safety profile can be that greatly needed oral therapy. Based on the strength of these Phase 2 clinical study, promising clinical results, the company continues to be duty bound during this persistent global pandemic to pursue this COVID-19 indication, even though it's not the primary focus of the company. Finally, I will comment on TADFIN. TADIN is our combination tadalafil 5 milligram finasteride 5 milligram capsule developed to treat lower urinary tract symptoms caused by Benign Prostatic Hyperplasia. The combination product contains tadalafil, which is approved for the treatment of BPH and erectile dysfunction and finasteride for BPH. A PDUFA decision date for TADFIN is in December of 2021. We plan to launch TADFIN, if approved, via digital marketing and telemedicine channels. And when launched it should be a near-term source of additional revenue for Veru to invest in our promising oncology pipeline. Although Ms. Greco will provide the full financial highlights on Veru's commercial segment, which is FC2 and drug commercialization costs, I am happy to report that we've achieved another record quarter and year-to-date. In fact, our 9-month year-to-date revenue increased 48% to $46 million, which has already beat the revenue of $43 million we had for the entire fiscal year of 2020. Our growing base commercial business, which is now in its fourth year of growth and the prospect of additional growing revenue from FC2 plus the future revenue from TADFIN places Veru on solid financial footing to have the resources to continue to invest in our promising premium drug pipeline for large market opportunities. I will now turn the call over to Michele Greco, CFO, CAO, to discuss the financial highlights. Michele?

Thank you, Dr. Steiner. As Dr. Steiner indicated, we're having another great year. In December, the company sold PREBOOST for $20 million. In February, the company completed an equity raise, which resulted in $107.9 million in net proceeds after deducting underwriting commissions and costs. And in the third quarter, the company achieved record level net revenues and gross profits related to the sales of FC2. For the first 3 months of fiscal year 2021, our net revenues were $45.6 million, surpassing $42.6 million in net revenues for the entire fiscal year of 2020. We have already achieved a record year for net revenues versus any prior full fiscal year after only 3 quarters. Let's start our highlights with third quarter results for the 3 months ended June 30, 2021. Overall, net revenues were up 71% to $17.7 million from $10.3 million in the prior year third quarter due to the growth of our FC2 U.S. prescription business. The company reported significant FC2 sales growth and its prescription business with net revenues up 150% to $13.5 million from $5.4 million in the prior year third quarter. Gross profit rose 113% to $13.9 million or 79% of net revenues compared to $6.5 million or 63% of net revenues in the prior year third quarter. The increase in gross profit and gross margin is driven primarily by increased sales in our U.S. FC2 prescription business. Operating expenses for the quarter increased to $16.7 million compared to the prior year quarter of $7.9 million. Research and development costs were $11.2 million compared to $4.4 million in the prior year quarter due to the commencement of several new phases in our clinical trials. The operating loss for the quarter was $2.9 million compared to $1.4 million in the prior year quarter. In the prior year, the company received a forgivable loan of approximately $540,000 under the Paycheck Protection Program of the CARES Act. The forgivable loan was treated like a government grant and recognized as a reduction in operating expenses during the quarter. As a result, we recorded a reduction to selling, general and administrative expenses of approximately $420,000 and a reduction to payroll-related research and development costs of approximately $120,000. Non-operating expenses were $2.7 million compared to $1.4 million in the prior year third quarter and primarily consisted of interest expense and change in the fair value of the derivative liabilities related to the synthetic royalty financing. We entered the synthetic royalty financing during March of 2018. For the quarter, we recorded a tax benefit of $2.9 million compared to a tax expense of $241,000 in the prior year third quarter. The tax benefit recorded for the quarter is primarily due to the increased value of the U.K. net operating losses due to an increase in the U.K. tax rate from 19% to 25%. The bottom line results for the third quarter of fiscal year 2021 was a net loss of $2.7 million or $0.03 per diluted common share compared to a net loss of $3 million or $0.05 per diluted common share in the prior year third quarter. Turning to the results for the 9 months ended June 30, 2021. For the first 9 months of fiscal year 2021, total net revenues were up 48% to $45.6 million from $30.8 million in the prior year period, again, a record high for any fiscal year. The company reported growth in FC2 sales and the U.S. prescription business and the global public sector business. Net revenue from the U.S. prescription business was up 79% to $32.9 million from $18.4 million in the prior year period. Net revenue for the global public health sector business was up 6% to $11.8 million from the 9-month period. Overall, gross profit was $35.6 million or 78% of net revenues compared to $21.2 million or 69% of net revenues in the prior year period. The increase in gross profit and gross margin is due primarily to the increase in the U.S. prescription business and a decrease in labor, transportation and equipment maintenance costs. Operating expenses increased by $14.5 to $39.2 million compared to the prior year period of $24.7 million. The increase is primarily driven by research and development costs, which increased by $10.8 to $24.4 million from $13.7 million in the prior year period. Operating income for the period was $14.8 million compared to an operating loss of $3.5 million in the prior year period, an increase of $8.3 million. The increase is primarily due to gain on sales of PREBOOST of $18.4 million. Excluding this gain, we had an operating loss of $3.6 million for the period. Non-operating expenses were $5.9 million compared to $3.6 million in prior year period and primarily consisted of interest expense and change in the fair value of the derivative liabilities related to the synthetic royalty financing. For the 9-month period, we recorded a tax benefit of $2.8 million compared to a tax expense of $30,000 in the prior year period. The company has net operating loss carryforwards for U.S. federal tax purposes of $42 million with $13.8 million expiring in years through 2040 and $28.2 million, which can be carried forward indefinitely. Our U.K. subsidiary has net operating loss carryforwards of $61.3 million, which do not expire. The bottom line results for the first 9 months of fiscal year 2021 was net income of $11.7 million or $0.14 per diluted common share compared to a net loss of $7.1 million or $0.11 per diluted common share in the prior period. Excluding the gain on sale of PREBOOST, the adjusted net loss was $6.7 million or $0.09 per diluted common share in the current period. Now turning to our balance sheet. As of June 30, 2021, our cash balance was $123.2 million. Our accounts receivable were $8.3 million. Due to our sale of PREBOOST in December, we added $15 million in cash during December and $5 million in notes receivable, which will be collected over the next 10 months. In February, we completed an underwritten public offering of 7,419,354 shares of our common stock at a public offering price of $15.50 per share. Net proceeds were $107.9 million. Our net working capital was $137.2 million at June 30, 2021, compared to $12.3 million at September 30, 2020. During the 9 months ended June 30, 2021, we used cash of $14.8 million for operating activities compared with $1.6 million used for operating activities in the prior period. Overall, we're delighted to see the continued increases in sales in the FC2 business. This revenue source, together with our strong balance sheet, continues to be the sources of funds we use to invest in our promising pharmaceutical clinical development programs as we continue to transform our company into a premium oncology biopharmaceutical company seeking large market opportunities. Now I'd like to turn the call back to Dr. Steiner.

Thank you, Michelle. Our company's fundamentals are strong. We have enjoyed another strong record financial quarter with also another record for U.S. FC2 prescription revenues, which has allowed us to significantly advance our clinical programs. Based on year-to-date performance, we'll have a record year in revenue, with the robust performance of the commercial business, plus the prospects for additional future revenues in TADFIN, coupled with our strong cash position, we believe that we'll be able to substantially invest in the continued clinical development of our prostate and breast cancer drug pipe-- product candidates as well as sabizabulin COVID-19 Phase 3 clinical study. We plan to continue to generate robust growing revenues for our sexual health business. We have successfully transformed our company into a late clinical stage oncology biopharmaceutical company supported by growing revenue from our cash-generating sexual health business. We have already-- we are already currently enrolling or plan to enroll a total of 6 pivotal or potentially pivotal studies this calendar year for major indications and large market opportunities. To summarize, in the prostate cancer clinical program, the company has initiated and is enrolling 2 clinical trials. Prostate cancer remains a very serious cancer as it is the second leading cause of cancer deaths in men. The drug product candidates that we're developing over 2 important indications. First, VERU-100, GnRH antagonist depot delivery formulations for androgen deprivation therapy of advance hormone sensitive prostate cancer has attributes to address the commercial limitations of other androgen deprivation treatments. The Phase 2 dose-finding clinical study is enrolling, and we expect to report results in the second half of the calendar year, and the Phase 3 clinical study has already been agreed upon by FDA, is expected to be initiated shortly thereafter. The second major indication of market opportunity takes advantage of the adoption and the widespread use of androgen receptor targeted agents, which have moved very early in the care of advanced prostate cancer, in which all men will develop resistance to these drugs and their prostate cancer will progress. The market for androgen receptor targeted agents is approaching $6 billion annually. We're developing sabizabulin, an oral agent which has the efficacy that appears to be similar, if not greater, to what has been reported in the literature for chemotherapy but have side effect profile that's similar to what has been reported in the package inserts to androgen receptor targeted agents. This will allow sabizabulin, if approved, to be prescribed by both urologists and medical oncologists for men after progressing on androgen receptor targeted agent or before IV chemotherapy. The Phase 3 VERACITY clinical study to evaluate sabizabulin for the treatment of metastatic castration and antigen receptor targeted agent resistant prostate cancer is enrolling. In the breast cancer program, the company expects to initiate 3 clinical trials soon. Breast cancer also remains a very serious cancer as it is also the second leading cause of cancer deaths in women. ER positive breast cancer occurs in 85% of all breast cancers. The standard care now uses-- the standard of care now uses CDK4/6 inhibitor in combination with an estrogen blocking agent in the first and second line metastatic settings. Almost all women will become resistant to CDK4/6 inhibitor, and the standard of care in this setting is now being defined. The drugs we are developing offer 2 important indications in AR positive, ER positive breast cancer. Using a companion diagnostic to selecting women who have greater than 40-- greater than equal to 40% AR staining in breast tissue, which would represent approximately 50% of all women who are ER positive with metastatic breast cancer. The first indication for enobosarm monotherapy is in the third line setting. The second indication is a Phase 2b clinical study that will evaluate enobosarm combination with abemaciclib, the CDK4/6 inhibitor in the second line setting. Enobosarm by targeting and activating the androgen receptor represents the first new hormone therapy in breast cancer in decades. For the other 15% of women have triple negative breast cancer, we plan to initiate the Phase 2 clinical study evaluating sabizabulin monotherapy, and a sabizabulin plus Trodelvy combination therapy versus Trodelvy monotherapy in women with metastatic triple negative breast cancer who have failed at least 2 chemotherapies. The goal is to see if sabizabulin alone or in combination with Trodelvy, will have better efficacy and safety profile, specifically for possible protection against neutropenia than Trodelvy alone. Finally, we're enrolling a Phase 3 clinical trial to evaluate sabizabulin in hospitalized COVID-19 patients with high-risk for ARDS. We're still in the middle of a global pandemic. The fact is that COVID will be a long war. We have witnessed evidence of this over and over. The bottom line is that although we have effective vaccines for now, we still need effective drugs to win the war. We have to be-- have to continue to be steadfast in the execution of our Phase 3 clinical study. If we confirm the promising results observed in the completed Phase 2 clinical study, we expect to seek emergency use authorization for this indication. We are committed. COVID is not going away. In summary, we have a portfolio of premium late clinical stage drug candidate products for large global market indications, we expect a stream of steady, positive news flow achieving clinical trial milestones and reports of clinical trial data. We are open to the possibility of a pharmaceutical partnership if it enhances shareholder value. And we have a rapidly growing commercial based business, which affords us strategic options. With that, I'll now open the call to questions. Operator?

[Operator Instructions]. Our first question comes from Brandon Folkes from Cantor Fitzgerald.

Congratulations on all the progress. Maybe firstly, just having transformed Veru into an oncology company, you do have a fair month going on. So do you have any sense of urgency to sell the FC2 business just to streamline the company and reinvest those funds? And then along those lines, any change in thinking about whether you may fund the COVID program you sold, given the-- what, once you see the data?

So the first question is, given that we clearly have transformed ourselves into an oncology company, and there's no doubt now with the Phase 3s and the Phase 2bs that we're on track with two the major cancers in areas that are large markets. So we feel very, very good about that. But interestingly, we're also-- with the FC2 business, we're looking for strategic options, but these strategic options-- it's been most interesting that we're not in the rise. So the keyword that you used was urgency. So there's no real urgency because, look, it's generated $45 million in the last...

Nine months.

Nine months. And if we stay on track with that same growth, we're say essentially bringing in the amount of money we need to fund all of our clinical trials. And so if you look at it that way, and you look at the cash in the bank, we raised $107 million, we've got $120 million, whatever number, $130 million if we add the accounts receivable, almost to $140 million, so we're not burning through our cash. So we're in a very interesting position that we're in the driver seat to see what we want to do with the asset. So I think-- and by the way, strategic option doesn't always mean sell the business. There can be other things that we can do that can enhance shareholders' value and allow our shareholders to get the best of both world. So we're working through that, no urgency, and it's not taking our eye off the ball, which is to continue to push and execute on the oncology side. As it relates to your second question, when I said relating to COVID-19, and whether or not we're prepared to fund it after we report positive results. So as I mentioned in my prepared remarks, that we have the resources and we have the clinical trial supply, drug supply. So we're going to be able to run the study without losing a beat and so we're not dependent on external funding, or funds for that. If we have successful data, we're going to be in a very interesting position again because even though we have begun to increase the scale-up of sabizabulin because of the multiple trials that are going on, including COVID-19, it's a different level of production that you need to do to get ready for the U.S. population and the world. With that said, we will see. I mean, I think we're at a 9 milligram dose, you need a lot of drug to begin-- and it's only a 21-day treatment, and we can do the treatments at 7-day interval. So there's a lot of flexibility to try to quote spread the drug as quickly as we can. But the ideal situation would be just like we saw recently with Merck that the government will step in and provide the resources required to scale up so that the drug will be available for the masses, including outside the U.S. And so we'll continue to move in that direction because, as I said, we've already taken care of the resources and the drugs that we need to do the Phase 3. But I do think that we have positive data given the environment that we're in right now and the fact that people are so fatigued that they're also realizing that this COVID thing is not going to where we have not turned the quarter-- corner. We had this whole discussion that it looks great. Everything was opening up. I'm hearing some of the conferences are starting to get canceled again. It just doesn't-- with stock guys, and we're only going to win this with a vaccine and a drug. So I do think that the move for funding will change dramatically as people step in with positive data.

Next question comes from Yi Chen from H.C. Wainwright.

The first question is, the-- has the Delta variant in any way affected the enrollment speed?

Yes. So I'll tell you what-- so the answer is yes, and let me tell you why. So when we started the clinical trial, and you can go back and look at when we said we opened the COVID-19 Phase 3, the United States's contribution to the trial enrollment [Technical Difficulty] and the reason we can't incredibly [Technical Difficulty] is because the rates of hospitalization and death kind of just disappeared. And I have a person that I call in each of these emergency-- excuse me, each of these ICUs to see what's happening because, looks, it's crickets now, it looks like we've lived this thing. And I-- a week ago, I got a phone call from him saying that he's still working on this drug because we're getting slaughtered. So you just have to pick up the newspaper and see that it's gone the other way. So yes, the Delta [Technical Difficulty]. The delta variant is definitely helping us in the U.S. ex-U.S., the Delta variant has already been out there in Brazil and South America, the Brazilian variant is there. South America has been hit extremely hard. And so we're in those countries that continue to look like we did 6 months ago or 4 months ago. And then on top of that, you know the Delta variant is coming. We're hearing from sites across the world that they're getting ready to the Delta variant. So they're seeing what happened in the United States and happening in the United States. So it's taken on an extreme urgency. And as I had mentioned before, the way that sabizabulin works is that it works through interrupting microtubules and microtubules are responsible for pulling the virus from the surface into the nucleus where the coronavirus can replicate. And then once it makes new viruses, the viruses have to be brought to the outside of the cell and released, and our drug works by interrupting that, again, the microtubules, which are required to-- like a highway to bring the virus to the outside of the cell and release it. So we don't care whether it's a blue car or green car or a bus or a truck, the highway is gone, you're not going to be able to move freely in and out. So we're comfortable that we're not going to have an issue like a very specific antibody or a vaccine against the variant. And-- so I think that's going to be the major strength of our compound. So whether Delta variant or Lambda variant or some of these other variants that are coming through, it should not matter. And so I think that puts us in good footing to-- if again, if we replicate the Phase 2 results, to have an effective broad spectrum type of product.

Got it. And then also, sabizabulin should perform the same among those patients that got COVID-19 regardless whether they are vaccinated or unvaccinated. Is that correct?

Yes. But in fairness, it is a good question, in fairness, it's-- and again, we're staying very, very close to this because we're in the middle of this war, so to speak, if you're vaccinated, you tend to have a more mild outcome. And so yes, you're seeing this strange breakthrough. And what's happening is that the unvaccinated are the ones that are really are in the brunt of this particular part of the pandemic. And so if you're unvaccinated, then the Delta variant, you're going to get it, and you're going to get it quickly, but still, it's the same situation, age, comorbidities and the whole bit. And even though we're hearing that a lot of the young people are starting to show up because they didn't get vaccinated. About half of these ICUs are filled with the people that are still older age that didn't get vaccinated. So there's going to be plenty of people that we can try to help through our clinical trial, but more importantly, confirm with our clinical trial is going to support-- clinical trials are going to replicate what we saw in Phase 2. So that's what I would say about the Delta variant.

Got it. Does this slow down the enrollment for the Phase 3 prostate cancer trials?

No, we have not seen that. Interestingly, and I had made this comment before, that with cancer patients, cancer-- I mean, cancer, it's metastatic, it's spreading. And so people are scared. What we did see in the first half when we had the Phase 1b and the Phase 2 ongoing is we did have a few patients that got a little bit nervous about coming into the hospital to get their scans. So they're already in the trial that was enrolled, but they kind of-- we got a little delay here and there when we actually looked with a CT scanner an MRI, but that was more of a rare instance. Most people stayed on track. And so now, I can tell you that sabizabulin Phase 3 is open and enrolling, and we're smack on target, if not a little ahead of target in terms of enrollment. So far, we have not seen that problem. And then get back to your point before about COVID-19, there's no question we're getting a lot of inbound interest for sites in the U.S. before, like I said, it was crickets. We couldn't-- nobody was calling us, nobody was returning our calls. But that's changed dramatically. And so we're hoping that this will get us to the finish line in terms of enrollment.

The next question comes from Kumar Raja from Brookline Capital Markets.

So with regard to the completion of enrollment by the end of the year for the COVID-19 trial, does that take into consideration the recent upticking cases? And also in terms of dosing either orally or by the nasogastric route, do you see any difference in efficacy based on how the drug is being administered.

Right. So nasal-- I'm answering the second question first. So you're asking that sabizabulin in COVID-19 being a capsule or are we finding some problems administering the drug in the ICU setting.

It looks like they can be either administered orally are using the nasogastric tube. So, yeah.

Yes, yes, exactly. So from that standpoint, we have not seen any problem because patients need to get medicines. And so we-- because it's a capsule and it's a powder in the capsule, we've had no problem with administering either orally or through an NG tube. So that's been fine. As it relates to your question about the uptick and meeting our goals. In other words, we said we'd get this thing filled by year-end and then a quiet in the U.S. So I must admit we were getting nervous because we have to have a certain U.S. component in a win way. But now we're not nervous anymore because the U.S. has gone-- I mean just look at the numbers, it was 108,000 new cases on average daily and the hospitalizations are picking up, 2 weeks after the deaths will start picking up. And so it's just-- I mean, we've gotten to a point now, now entering the fourth wave, that we can always predict what's going to happen, and it's not-- other than to vaccinate the patient, the unvaccinated patient is kind of following the playbook. So I would say because of the uptick in cases that we're more likely to reach our goal.

And with regard to sabizabulin as well as enobosarm, with regard to Europe, what's happening in that front? And also, you talked talk a little bit about pharmaceutical partnerships. So how should we think about it? Would it be like just like partnership for Europe? Or maybe a little bit of color on that?

Yes, sure. So we're fortunate that we're going to be in a position in both our breast cancer and prostate cancer programs to be in Phase 3. And because we're in Phase 3, the question then becomes, how are you viewing partnerships. And as you know, the back of the envelope would say that if you piecemeal the relationships, it will decrease the value of the opportunity for a global partner. And so what we're trying to do is, first of all, and we'll take a step back, sabizabulin prostate, we're only running in the U.S. and the enobosarm Phase3, our test study is being done in the U.S. and Europe. And we're also in the process of beginning to have some of the EMA discussions that we will need. And as you know, EMA and with Brexit and everything that understands Britain, so that's gotten a little strange. But our position right now is to execute on the trial, the trials are open label, which means that we have a DSMB that can look at this, and we can continue to execute. But I think the most important thing for us to do is get these things filled, execute on them. We are in constant discussions with large pharma and medium-sized pharma and small pharma across all our programs. And-- but I think the way we're thinking of it, the biggest value that we're going to have to shareholders is to see if we can couple the good Phase 2 data with some good Phase 3 data or some promise of Phase 3 data because it's open label. And to me, that feels like that's going to get us the best value. We have the resources, thanks to our shareholders' support, and we have the resources because of our base business. So I think we're in a very unique position that we can wait it out to get the best position-- get the best deal. So-- but I do believe that at some point, some of our programs are going to be best served with a pharmaceutical relationship. Particularly on the commercial side. And so we're doing exactly as you would expect us to do, and that is having discussions with the largest and the smallest-- the largest, not the smallest, the largest, and the medium. Largest for global and the medium for piecemeal. And-- but our preference is to keep the dialogue going until we get an offer we can't refuse.

Next question comes from Chris Howerton from Jefferies.

I guess just two for me. First, on the FC2, obviously, great to see the continued growth on that program. I guess, I'm curious if you could provide a little color as to what is driving that growth currently? And what is the expectations going into the second half of the year, perhaps like there is some seasonality to the trends that you might expect for contraception, that would be helpful for us to know about. So that's one question. And then the second question, I guess, maybe I missed it, but I'm just wondering when we might expect the Phase 2 portion for the ongoing study in prostate cancer?

Great. So the first question had to do with-- can give you a little bit more color in terms of FC2 growth. And I will tell you there is no seasonality. And as you can tell, it's also completely COVID-19 resistant. So the growth is being driven by-- and this is the beauty of it, we have telemedicine partners that are using their resources to market and sell and bring women seeking birth control to their website, the storefront. It's an incredibly powerful way to go out there and market and sell because if we look at the number of FTEs that are supporting our U.S. business, in fact 3 or 4, and that's generating $30 million, $35 million, if you take out U.S. public-- global public sector. And so it's incredibly efficient for a company like ourselves because then we can use those resources to put back into the company. Now with that said, where we see the growth taking place is we're also seeing that there's a very, very healthy reorder rate with the telemedicine, so it's not-- yes, it's a big blue ocean, and people are starting, but they're coming back. And the reorder rate is very, very healthy. As you know, that won't help the numbers from an exponential standpoint. Also, we're in discussions with other telemedicine groups that are focused on birth control. And because this area is growing, new ones are showing up periodically that we've engaged with. And hopefully, we'll pick up a few more of those. Any time we pick up a few more of those, it really increases the number of prescriptions that we're able to have. And then finally, we're going to look for other ways that we can take advantage of digital, internet channels to sell. And so we've been very, very pleased, and the global public sector defined, It was flat, or it was a little bit more than flat. But boy, do you-- I think you're going to see all of the growth driven primarily by the U.S. prescription business. And the ratios have flipped. Where it used to be all public sector and then with a little bit of U.S. prescription. Now it's going to-- from a revenue standpoint, from a profit standpoint, it's all going to be primarily U.S. and so I'm happy to report we do believe we're going to have a pretty good year. I mean, this is-- we're entering-- we're 4 years into it. We're entering in our fifth year of growth. And go look, it just seems to be the same rate. And that's very good for us because if we can maintain that, then we're paying for our clinical trials. And so that's-- and keep some real cash in the bank and not touch it. So this is so that we can accelerate and stay on track, and we can also look at a big pharmaceutical partner and say, look, you're not going to wait us out. If you can give us a deal, give us the best deal possible. So I think it's put us in a good position. So to give you color, there's no seasonality, COVID-19 is not affecting the growth, the -- we're actively involved in business development to get additional telemedicine groups on board, and we also have a few things that we're doing to also enhance that. So the business is growing. Happy to report. The second question you asked had to do with the ongoing Phase 2. The ongoing Phase 1b, it's completed, but we still have a couple of patients that are beyond 2 years. So that study is still going on. And in the Phase 2, we still have patients on it. And so I think what will happen is by year-end, we'll be able to provide more color because the longer we wait with these patients, the more accurate that we're going to get in terms of understanding the median progression-free survival and some of the other data. So the Phase 3 is up and running. Urologists and medical oncologists are excited about the data they have seen so far. We've reported updates. The updates are consistent that the agent has activity. And in prostate cancer, that's why we're excited to expand it into triple negative breast cancer because data that we saw in prostates showed that we would have an effect on prostate cancer with no neutropenia and neurotoxicity. That played out clinically. And then we also have data in triple negative breast cancer that-- it should also translate clinically. And it will be interesting to see how that plays out when we go into our second major indication. So I would say look for data, the Phase 2 sabizabulin portion of the prostate cancer study towards the end of the year.

That's great. And I guess, I think we've discussed this in the past, but maybe if I can ask, is there any information that you anticipate learning from either the ongoing Phase 1b, obviously, the longer-term follow-up or within the Phase 2 patients that would any way change your current Phase 3 plans? Or do you feel pretty solid about those Phase 3 designs at this point?

I think we feel very solid about the Phase 3 design. I think the reason we're continuing is because if I would have told you that on average, these patients are failing in 3 months, 3.5 months with an alternative androgen receptor targeted agent, and we've got some patients in the Phase 1b, 12 months and now heading into 2 years, that's pretty good. But that doesn't change our Phase 3 design. And then the Phase 2 is also providing us information that we use to help the trial design assumptions and understanding the PFS and that kind of stuff. So I would say that we've learned what we needed to learn in the Phase 1b and the Phase 2, that's the reason we went to Phase 3 because we felt at that point, there was nothing new we're going to learn. And we just can't take the drug away and stop the study. So we have to keep providing drug for the patients that are responding. So no, I think we're on firm and solid assumptions for the Phase 3.

[Operator Instructions]. The next question comes from Alexandra Heller from Oppenheimer.

Congrats on the quarter. Can you walk us through how you see the VERU-100 fitting into the existing treatment landscape for hormone sensitive prostrate resistant cancer and then also your strategic plans for the asset?

Yes. So for VERU-100, the beauty of this compound is that we were able to sit on the side lines and watch how the field has evolved over the last 30, 40 years. And what we've learned is that medical castration is-- nobody wants surgical castration, medical castration is the way to go. And interestingly, in this current landscape with these new drugs that are allowing patients to live longer, such the androgen receptor targeted agents and some of the chemotherapy and the PARP inhibitors, you're finding out that patients are living longer. And in all instances, the base is androgen deprivation therapy. So when we went from 18 months now, you could be double or triple that. And they're on ADT, the whole time. ADT is truly a chronic therapy. And for us to get involved with that, with something that takes advantage of what we've learned. So what have we learned? We learned that the landscape now is that the agonist such as LUPRON, ELIGARD and those kinds of medicines, always-- when you give the injection, you have about 14 days, 2 weeks of high levels of testosterone that then comes down and the castration levels are not as ideal. And-- but yes, that's what we had and it worked. And then the antagonist came along and they shut off testosterone right away, and the patient gets castrated right away, and it turns out that it also lowers FSH, which is thought to be important for cardiovascular events. I mean, LUPRON, if you've had the LUPRON type drug, [indiscernible] showed this in their study that if you had a cardiovascular event and you were put on leuprolide, you have a 1 in 5 chance of having another one. It's pretty high. So I would argue that the GnRH antagonist was discovered first that LUPRON and the agonist have probably would never been approved. So I think this field is definitely moving to GnRH antagonists. Now in the flavors of GnRH antagonist, now the second challenge is how do you become part of the medical care standard versus how do you disrupt the medical care standard. So the standard of care right now is the patient comes in every 3 to 4 months to get imaging and to see their doctor and to come in every month as it makes sense, we know that because Decroralics was a 1-month GnRH antagonist depot and it did not do well. And it didn't do well because it was not a good drug. People are kind of using it to castrate the patient right away, then add LUPRON. So people were worried about it. But the problem is it didn't fit standard of care. And-- so the 3 and 4 month depots froms LUPRON and ELIGARD are the of standard of care. So if you had a GnRH antagonist, that was a 3 or 4 month depot, then you could be easily substitutable and become the preferred choice because at the end of the day, compliance is really kind of important for this agent. And the reason compliance is important for this agent is because you don't feel well when you get castrated. You lose your libido, you become-- you develop change in body composition with fat and the diabetes and loss of muscle mass and gynecomastia and hot flashes. So you're constant looking for a way to get a drug holiday. And so they were in control, if the patient was in control with their own castration, then they may not be as compliant because they want that weekend break or they want to feel good when their kids, or whatever. And testosterone comes back up, it's going to cause the tumor to spread and then the patient is going to have to get on some more expensive drugs than the androgen receptopr targeted agents and IV chemo. So we think the strategy for us is that when the patient first develops advanced disease, metastatic prostate cancer that's hormone sensitive, that the foundation, the drug that you start with should be our drugs, it should be VERU-100. And because it's given every 3 months, potentially be given every three months, it would be-- it would not buck the standard of care. So doctors will be comfortable providing it, knowing the patient will come back at the same time, but they will usually see the patient at the same time that we usually image the patient. So you're not changing standard of care. And the urologists and the physician gets paid because they get administered the medicine, and they also get a percentage of the product based on the AWP, so that doesn't change. And so our strategy and compliance is critical. Now the other thing that's changed also is that the data shows that it's unusual for a patient to get ADT monotherapy today. And so if somebody comes with hormone sensitive disease, they almost certainly can have it coupled with some of these other medicines. And that's even another reason why you want to try to decrease the pill load and other things that the patient is taking and make it simple so that there's 1 less thing they have to worry about every day. So I do think it's going to be very interesting. The other thing, and that will be quiet, is strategically, the worldwide market for ADT androgen deprivation therapy is about $2.6 billion, and that's based on pricing for leuprolide. GnRH antagonists are not price packaged generic leuprolide. And so the market is probably double, if not triple that. And we just don't need to get much of that market to really move the needle. So this is a really attractive option and a really attractive product for us. And [Technical Difficulty] the way we think of this product is this is the kind of product we could have regional license-- regional partners in Europe, Asia and maybe hold on to U.S. ourselves because it's the foundation. That's where you're going to go in and call on urologists and medical oncologists about prostate cancer. And as you know, we have sabizabulin for patients that fail ADT and androgen receptor targeted agent would make a lot of sense. So that's how we're thinking about it, Alex.

Ladies and gentlemen, this concludes our question-and-answer session. I would like to turn the conference call back over to Dr. Mitchell Steiner for any closing remarks.

I appreciate you all joining us on today's call, and I look forward to updating all of you on our progress in our next investors call. Thank you for joining us today.

The digital replay of the conference call will be available beginning approximately noon Eastern time today, August 12, by dialing 1-877-344-7529 in the U.S. and 1-412-317-0088 internationally. You will be prompted to enter the replay access code, which will be 10157539. Please record your name and company when joining. The conference call has now concluded. Thank you for attending today's discussion.