Aytu BioPharma (NASDAQ:AYTU) released second-quarter financial results and hosted an earnings call on Tuesday. Read the complete transcript below.
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Full Transcript
OPERATOR
Sam. Good day everyone and welcome to the Aytu BioPharma fiscal 2026 second quarter earnings call. At this time, all participants are placed on a listen only mode and we will open the floor for your questions and comments after the presentation. It is now my pleasure to hand the floor over to your host, Robert Bloom. Sir, the floor is yours.
Robert Bloom
All right, thank you very much and good afternoon everyone. As the operator indicated, during today's call, we will be discussing Aytu BioPharma's fiscal 2026 second quarter operational and financial results for the period ended December 31, 2025. Joining us on today's call is Aytu's Chief Executive Officer, Josh Disbrow and Ryan Selhorn, the company's Chief Financial Officer. At the conclusion of today's prepared remarks, we'll open the call for a question and answer session. I'd like to remind everyone that today's call is being recorded. A replay of today's call will be available by using the telephone numbers and conference ID provided in the press release issued earlier today, or by utilizing the link on the company's website under Events and Presentations. Finally, I'd also like to call to your attention the customary safe harbor disclosure regarding forward looking information. The conference call today will contain certain forward looking statements, including statements regarding the goals, strategies, beliefs, expectations and future potential operating results of Aytu BioPharma. Although management believes these statements are reasonable based on estimates, assumptions and projections, as of today, these statements are not guarantees of future performance. Time sensitive information may no longer be accurate at the time of any telephonic or webcast replay. Actual results may differ materially as a result of risks, uncertainties and other factors, including but not limited to the factors set forth in the company's filings with the SEC. A2 undertakes no obligation to update or revise any of these forward looking statements. With that said, let me turn the call over to Josh Disbrow, Chief executive officer of A2 Biopharma. Josh, please proceed.
Josh Disbrow
Thank you Robert and welcome everyone. I'm excited to be speaking with you on what is truly a momentous time for A2. As we just commercially launched EXUO, the first and only five HT1A agonist approved by the FDA for the treatment of MDD. Representing a truly novel way to treat MDD. As many of you are aware, we held an Investor day back on January 20th where we spent the better part of two hours diving into all things EXUO. If you weren't able to attend in person or part of the live broadcast webcast, please know that A Replay is available on our website under the Investor Relations page and I certainly encourage everyone to take a listen. Given the deep dive we just did two weeks ago. Let me spend a few minutes summarizing a few of the key discussions that occurred during the event, which were really divided between understanding the 5ht1a receptor and its clinical importance in major depressive disorder, along with the unmet treatment needs and their implications for antidepressant treatment selection. In MDD and further exu was clinical trial data including efficacy and safety and some in depth elements of our commercial launch strategy. First, on the clinical side, Dr. Steven Stahl, an internationally renowned clinician, researcher and teacher in psychiatry with subspecialty expertise in psychopharmacology, discussed how the current standard of care for major depressive disorder has largely relied on SSRIs and SNRIs, which work by broadly increasing serotonin levels in the synapse and non selectively activating multiple serotonin receptor subtypes. While these therapies can provide symptom relief, that lack of selectivity is believed to drive many of the well known limitations of reuptake inhibitors, including treatment, emergent sEXUOl dysfunction, insomnia, anxiety, appetite changes and weight gain and other off target side effects that can impact tolerability and patient adherence. More targeted approach specifically specifically designed to engage the 5ht1a receptor, which is thought to be central to antidepressant efficacy, EXUO acts as a full agonist at presynaptic 5-HT1A autoreceptors to enhance serotonergic signaling and as a selective partial agonist at postsynaptic 5ht1a receptors without any significant activity at receptors associated with sEXUOl side effects or weight gain. This differentiated mechanism has potential implications across key brain regions involved in mood, anxiety, cognition and stress, thus reinforcing our belief that EXUO offers a novel and clinically meaningful advancement in the treatment of MDD. Next, Dr. Anita Clayton, who has focused her clinical practice and research on multiple psychiatric areas of unmet need, including major depressive disorder, in which she has been a principal investigator for essentially all the new antidepressants approved since 1991, highlighting how major depressive disorder remains a significant and growing public health challenge affecting an estimated 21 million US adults, with nearly 15 million experiencing severe functional impairment. Despite the widespread use of first line SSRIs, 50 to 60% of patients fail to achieve remission and even among those who do, many never fully recover key aspects of daily functioning such as cognition and workplace productivity. Nearly half of patients ultimately discontinue their initial therapy, often driven by tolerability issues, most notably sEXUOl dysfunction and weight gain, which affect a substantial portion of patients on traditional antidepressants. Against this backdrop, she discussed the important clinical implications for EXUO, which does not carry a warning for sEXUOl dysfunction and demonstrated a neutral sEXUOl profile in clinical studies with no sEXUOl related adverse event rates exceeding placebo and showed no clinically meaningful weight gain compared to placebo across pivotal trials. These attributes position ECSTUA as a truly differentiated option that directly addresses some of the most persistent unmet needs in the treatment of MDD. Finally, Dr. Christoph Korrell, who annually is listed as one of the most influential scientific minds and among the top 1% cited scientists in psychiatry, discussed how EXUO's Phase 3 clinical program demonstrated meaningful efficacy and a well defined safety profile in adults with major depressive disorder. I once again on this call thank these three esteemed members of the psychiatry community for their participation and again encourage everyone to listen to their commentary on EXUO. Okay, now let's turn to the commercial launch plans for eczua which is being executed upon with a clear balance of efficiency and comprehensiveness with a focus on driving prescriber adoption and long term brand growth. The core of this effort is a highly motivated and incentivized sales organization supported by metrics based performance management, incentive driven territory growth and a strong sense of urgency around execution. In addition to our internal sales team, we are augmenting our reach through scalable and efficient initiatives including a virtual sales team designed to broaden awareness and generate early customer leads as well as a rolling contract sales organization model that allows us to flex in person promotion in line with product performance and as profitability and cash flow align. Our promotional strategy is intentionally targeted yet broad in scope, combining both personal and non personal approaches to maximize impact. From a non personal standpoint, we are deploying a focused compliant media based consumer promotion strategy while ensuring our salesforce efforts remain concentrated on the highest value psychiatry practices. Targeting has been informed by detailed customer profiling and direct salesforce input prioritizing high volume antidepressant prescribers, prescribers with a demonstrated propensity to adopt branded therapies and physician practices already familiar with A2 through our ADHD portfolio and the RX Connect platform. The early wins we're seeing reinforce our confidence that this focused approach is resonating in the field. Patient access is a critical pillar of the ECUA launch supported by our best in class Rx Connect platform along with full retail distribution through national wholesalers to ensure nationwide pharmacy availability. Rx Connect was purpose built to remove uncertainty and friction for patients and prescribers by guaranteeing predictable coverage for commercially insured patients, thus minimizing administrative burden and capping patient out of pocket costs at no more than $50 per prescription for ECSUA, again for all commercially insured patients. Importantly, patients also retain the flexibility to fill prescriptions outside the RX Connect network when preferred, ensuring broad access and choice for all patients. Finally, medical education and scientific engagement will underpin sustainable adoption. Our Medical affairs team is rapidly expanding a robust KOL network and executing an active publication and medical meeting strategy as EXUO enters its first full year of commercial availability. Insights from more than 1 million prescriptions filled through RX Connect continue to guide our payer contracting Strategy, covering approximately 60% of commercially insured MDD patients with encouraging early coverage across Medicaid and Medicare populations. Overall, the ECZUA launch is highly focused, data driven and designed to scale intelligently over time, aligning promotional investment with performance and cash flow to support durable growth. As we are really only a couple or a few weeks into launch at most, the availability of data is sparse, but let me share a couple of data points we do have which is largely derived from our insights from the RX Connect platform. To date, scripts for ECUA have been written from 27 states, including numerous states where we don't have sales reps, thus highlighting the very broad opportunity. Over 100 doctors have prescribed EXUO to date, which is exciting with us just over 30 days since ECUA was first made commercially available. We're in fact already seeing our first set of refills come through the platform and perhaps most importantly, the early feedback from patients on ECUA has been very good. While only a small number of patients have been on EXUO for a month or longer, they're reporting good tolerability and satisfaction with the product. So all signs are positive in the early days here post launch. And to say the least, we are extremely excited to have ECZUA fully underway in launch mode and even more encouraged by the. While still very early, our efficient yet comprehensive launch strategy is unfolding as planned. Our sales team is exceptionally well prepared, our KOL network continues to expand and we are already seeing validation of our commercial approach. I look forward to being able to share more with you in the quarters to come. Let's transition for a moment now to our ADHD portfolio. For the quarter, ADHD net revenue was 13.2 million and this was just a slight decrease from the year ago period and flat compared to Q1 Excuse me. Quite impressive in my opinion, given the evolving dynamics of salesforce prioritization now geared towards EXUO and the recent introduction of generic competition. The evolution of the ADHD portfolio continues to perform above what I'll call standard expectations given similar circumstances. And we feel very good about the long term prospects of the ADHD portfolio given the protections afforded by RX Connect. As we previously discussed, Teva did in fact launch their ANDA for Xenis back in mid December. The early data on Scripps continues to reinforce our long term conviction in the enhanced stickiness and attractive economic value of the A2RSConnect platform, through which, again I'll remind you, approximately 85% of our branded ADHD prescriptions are dispensed. The launch of our own Adzenys authorized generic has also served to limit the impact to date of the Teva generic. For the six week period ending January 16, the Teva generic accounted for approximately 5% of prescriptions written over that same period. Our authorized generic of Adzenis represented just under 20% of total prescriptions, with the remaining volume continuing to be branded at Adzenys. While we do expect some continued transition from the brand to generics as we deemphasize our ADHD portfolio In favor of ECSUA, we do believe that any incremental non A2 generic volume will largely come from the roughly 15% of the prescriptions dispensed outside the RX Connect platform in the near term as we expect relatively little erosion within the network. We've also taken a recent price increase which will help to offset any script erosion via net pricing improvements we've seen over time. While time will ultimately tell, we believe the dynamics here will differ meaningfully from many comparable situations, and we do not expect the typical erosion trajectory to fully materialize in the way other brands have seen quickly on our pediatric portfolio. Before I turn it over to Ryan to review the financials in more detail, we saw a nice uptick in net revenue from the fiscal 26 first quarter to our fiscal second quarter coming in at 1.7 million compared to $715,000 in Q1. Part of this relates to reduced quantity of returns we experienced last quarter, while we also saw relative stabilization of prescriptions. To be clear, given the broader commentary from the FDA around fluoride and to prioritize our largest growth driver, we of course continue to focus the bulk of our resources on EXUO. If there are changes with respect to the fda, our approach may change, but to this point our legacy pediatric products remain non core for the company as we go forward. So with that, let me turn the call over to Ryan to go into more detail on the financials and I'll make a few closing comments and then we'll look to address any questions you might have. Ryan, thank you.
Ryan Selhorn
Josh, Let me jump. Let's jump right into it. Let's start on the revenue line. Net revenue for the quarter was $15.2 million compared to $16.2 million for the prior year. Breaking net revenue down the ADHD portfolio net revenue was $13.2 million compared to 13.8 million in the prior year period. The 13.2 million was also flat with the most recent sequential first quarter. The change from the year ago quarter is attributable to a decrease in total prescriptions primarily due to broader DE emphasis in marketing towards the ADHD portfolio as the company's marketing efforts have shifted towards EXUO, which is now the centerpiece of our commercial efforts and some relatively small impact from the generic that entered the market. All of this was then partially offset by product price increases and improved gross to nets. The pediatric portfolio was 1.7 million for the first quarter compared to 2.7 million last year and as Josh just mentioned, we had just 715,000 in the most recent sequential first quarter. The change in net revenue from the year ago quarter is primarily attributable to the broader DE emphasis in marketing towards the pediatric portfolio in lieu of EXUO, particularly given the recent commentary by the administration and the FDA around Fluoride Gross margin was 63.5% during the quarter compared to 66.5% last year. The decrease in gross profit percentage is primarily related to the decrease in net revenue given the focus on EXUO's launch as well as transition related expenses associated with the ADHD authorized generic performance whereby there was a write down of approximately $600,000 in inventory related to branded Adzenys. Excluding this write down gross margins would have been 67.4% for the second quarter of fiscal 2026. Turning to OpEx OpEx operating expenses excluding amortization of intangible assets and prior year restructuring costs was 11.1 million in the second quarter compared to 10.2 million in the prior year period. This 11.1 million figure also includes about 300,000 in depreciation and stock compensation, so the cash OpEx number is about 10.8 million. The change is primarily a result of increased EXUO launch investments partially offset by improved operational efficiencies such as reduced facilities expense. We also incurred a one time FDA PDUFA fee of $400,000 for Cotempla which flowed through the income statement this quarter. For the quarter we reported a Net loss of 10.6 million or $1.05 net loss per share basic compared to net income of 0.8 million or $0.13 net income per share basic in the prior year period. The fiscal 2026 second quarter results were impacted by derivative warrant liability loss of $8.2 million while the year ago period had a derivative warrant liability gain of $3 million. These changes in non cash derivative warrant liabilities are primarily related to a change in the company's stock price. We touched on this last quarter, but as a reminder, if our stock price increases we incur a loss. If the stock price decreases we incur a gain on these derivative warrant liabilities which are a result of the pre funded warrants issued due to ownership percent blockers as part of the EXUA transaction in a previous financing as well as standard warrants on the balance sheet. Those warrants are treated as a liability until they are converted to common shares at which time they move to additional paid in capital. During the quarter there were 550,000 pre funded warrants exercised which effectively added $1.3 million to APIC. As we sit today there are 10.7 million common shares outstanding plus an additional 8.8 million pre funded warrants outstanding which effectively puts us at 19.5 million shares outstanding. Finally, adjusted EBITDA was a negative 0.8 million for the second quarter of fiscal 2026 compared to a positive 1.3 million in the year ago period. The change primarily relates to the increased EXUO launch investments and broader de emphasis in marketing towards the ADHD portfolio and the Pediatric portfolio impacting net revenue and gross profits. Turning now to the balance sheet cash and cash equivalents were $30 million at December 31, 2025. This compares to 32.6 million at September 30, 2025. There were no major movements on the balance sheet during the quarter with most changes in inventory, accounts receivable, accounts payable, accrued liabilities and our revolving line of credit and other key items largely in line with normal operating procedures. Before I turn it back over to Josh, I just want to confirm a few assumptions largely pertaining to the EXUO launch as we enter the half of the year. First, as we communicated to you last quarter, the December quarter was just a small initial product load in which was in line with expectations. With the launch now Underway for the March 2026 quarter, we continue to expect to see a small initial ramp in EXUA net revenue due to our deliberate approach to remove early access barriers. As mentioned previously through RX Connect, we deliberately eliminated that friction by offering a no cost 14 day titration pack for commercially insured patients. We are guaranteeing full coverage of both month one and month two of therapy regardless of the insurance outcome, ensuring patients can remain on treatment through dose optimization without interruption, and allowing clinicians to evaluate EXUA based on true clinical response rather than payer driven access challenges. As we ramp up, this will lower the net revenues recognized by A2 until month three refills occur and these no cost guarantees are removed which will begin to occur during the June 2026 quarter and beyond. Simplistically put, we will see Scripps grow ahead of net revenue in the early going from a gross margin perspective. As a reminder, we have a 28% royalty on EXUO in addition to a true up on cost of goods sold. Think of it in essence as about a 31% cost of goods sold or a 69% gross contribution margin. We do anticipate some fixed expenses to be incurred in cost of goods sold. However, the upfront fee, post launch fee and any milestone payments will be reported as an intangible asset and amortized to the operating expenses which started in December 2025 after we launched EXUA. Finally, as I mentioned during the investor day, our original launch investment budget for EXUA of $10 million has been reduced to under $8 million, driven by execution efficiencies and tighter cost management without sacrificing commercial readiness. And of that approximate $8 million about 3 million is projected to be one time items such as training development, commercial and medical affairs consultants, and campaign and marketing materials development. So as we look forward for modeling purposes, we will see a continued uptick in the March quarter for OpEx, likely in the 4 to $5 million range excluding depreciation and amortization. Beyond that, moving forward, we will adjust our spend as the ramp of EXUO continues, but think about exiting the fiscal year at about $11.6 million quarterly normalized run rate with about half a million of that in non cash expenses. Assuming gross margins in this mid to high 60% range, that puts our break even at about 17.3 million of net revenue per quarter all in including exos spend cash breakeven would be about 16.6 million per quarter. As always, happy to go over any details during Q and A and with that Josh, let me turn it back over to you.
Josh Disbrow
Thanks Ryan. This is truly an exciting moment in a pivotal time in the company's history as we are now fully engaged in the commercial launch of exua, again a first in class treatment for major depressive disorder. We're already seeing prescriptions come through and are hearing strong enthusiasm from the field, reflecting the unique opportunity ACTUA represents as. The first and only 5-HT1A agonist. Approved for the treatment of major depressive disorder in adults, addressing a very large and a very meaningful unmet need. With extremely encouraging early momentum. Our commercial launch plan is comprehensive with a clear focus on prescriber adoption and brand growth while maintaining efficiency and relative spend. What our team has accomplished in just over six months since acquiring ECSTAS commercial rights, what often takes years in a large pharmaceutical corporation, I simply couldn't be more proud of what's been accomplished as we work to positively impact the lives of the approximately 21 million Americans living with major depressive disorder. As always, want to thank everyone participating on the call on your support. We'll now be happy to answer any questions that you have. Operator.
OPERATOR
Certainly everyone at this time will be conducting a question and answer session. If you have any questions or comments, please press Star one on your phone at this time. We do ask that while posing your question, please pick up your handset if you're listening on speakerphone to provide optimum sound quality. Once again, if you have any questions or comments, please press Star one on your phone. Your first question is coming from Thomas Flatten from Lake Street. Your line is live.
Thomas Flatten
Hey, good afternoon guys. Appreciate you taking the questions. Josh. You hinted at this a little bit. In your prepared comments. But I'm curious, in those hundred docs that have actually written prescriptions, if you have any anecdotal feedback from the sales team on why they made the decision to write, what was it that convinced them this would be a good alternative for the patients? Anything along those lines would be super helpful.
Josh Disbrow
Yeah. As is often the case, particularly in psychiatry. Thomas, and thanks for the question. It is mixed as you would expect various motivations for. For physicians in those very early days to prescribe. It's cross section of patients that have. Been challenging for them and challenging meaning. Not getting the response or robust response. And or side effects that patients have been experiencing in the form of, as. We would expect, sexual side effects or weight gain. There's definitely an interest in just the. MOA that in and of itself is attractive for physicians, psychiatrists particularly to try something new for a patient that again is probably inadequately controlled on something. And then there's an element as well that given the relative ease through which they're able to prescribe. Through Augs Connect, there's definitely an interest in being able to prescribe something new that has minimal barriers. So I'd say those are among the. Key things that are being sort of fed back to us. As we would expect in this early. Stage, we will get some difficult to. Treat patients and that's expected. Any new drug is going to often get the problematic patients that have been on countless medications. And so we expect that. But we also expect as time goes on, patients will probably better identify patients that are perhaps not down to the full extent of having tried many, many medications and start to position the product perhaps earlier in use. But that's at least the early feedback that we're getting.
Thomas Flatten
Got a super helpful and then particularly in light of Ryan's comments around Cash breakeven and Real Breakeven, you mentioned during your analyst day that you were contemplating a a salesforce expansion over time. First part of the question is is there an expectation of any of that occurring in fiscal 26? And then second part of the question is what triggers are in place for that to initiate?
Josh Disbrow
Yeah, good question. I think the short answer is it would be unexpected to expand that quickly. I mean we really need to get, as Ryan said, kind of through the trial periods into that sort of that June timeframe before we're sort of getting patients fully on their refills and. Obviously. Just getting more and more patients experienced in general. And in the context of what will trigger it, it will be overtrieving our. Internal forecast and getting the cash flow. We want to be clear that there's. No plan to expand without cash on. Hand to support that. And we'll be very judicious in how we think about expansion. Have identified territories beyond the 44. As we've talked about, there's a many. Multiples more that we could scale to. But again it's going to be the. Primary trigger with the board approval will. Be cash flow supporting it. There will not be any appetite to. Raise capital in the context of in the context of that specific piece for sure. So yeah, we're definitely waiting for profitability and cash flow.
Thomas Flatten
And then one more quick one if I might. You mentioned in your press release that you were working on a kind of a direct to consumer campaign. Could you maybe provide a little bit of detail on specifically what that looks like?
Josh Disbrow
It will largely be web based as most things are. We don't anticipate broad based media spend traditional over the air type of media. But we certainly have engaged in the. Early stages of search engine optimization and keyword search campaigns. So a lot of word search and things along that line. As patients are looking for alternative therapies. We will continue to look at social. Media angles, although that can be challenging. With respect to FDA and regulatory compliance given the fact that all products in this category have a black box warning. But we have in the early stages. Of looking at chat room forums and. Again, we need to be obviously very. Conscientious and compliant with that. But forums like Reddit and so forth. There'S a lot of chatter. In fact, we're already seeing some mention of ecstua for patients that have actually. Already tried the therapy and have been positive on it. So that'll be some of. That's an example of the types of. Things that we'll explore. But to be clear, we'll want to be very efficient. You know, our heavy spend will be on the face to face interactions with the sales force and you know, a far secondary piece of it will be sort of the consumer piece until we start to get some momentum and a higher level of awareness among the psychiatrists that obviously we're presenting the product to.
OPERATOR
Got it. That's super helpful. Thanks. Thanks, Thomas. Thank you. Your next question is coming from Naz Rahman from Maxim Group. Your line is live.
Naz Rahman
Hey everyone, thanks for taking questions and grab some progress. Just two quick short questions. Because of the weather around so much in the United States the last couple of weeks, have you seen any delays or issues with scripts getting filled after they were written or has that not been a problem? I realized it's been early days and just kind of following up from that too. The scripts that have been filled, have they multi bid from RS Connect or I guess retail pharmacies like do you know the mix there?
Josh Disbrow
Yeah, good question. Take the weather one for absolutely huge impact. You know, this is sort of two weeks of Snowmageddon, so to speak. So we really haven't had a complete week in the field. When you take into consideration we're at our launch meeting, you know, essentially the first full second full week of January, essentially the week of the 12th. The next week was a holiday week shortened due to the Martin Luther King holiday. So that was really their first time into the field and then really two. Solid weeks of weather affecting a huge chunk of our territories, the vast majority. In fact, and really with the exception of the western territories. Western, really meaning essentially, you know, California, I would say virtually every territory was affected, at least in some way. So that not only impacted Scripps getting filled, it affected shipments Getting two pharmacies, it affected reps, getting two doctors to, you know, present at appointments and meetings and so forth. So huge impacts, which is why we're. Even more encouraged because frankly, we have. Not had anywhere close to a full week of productivity in terms of the prescriptions that are being filled. Yes, most are coming through RX Connect, but I'm actually very pleased that we're. Seeing prescriptions come in areas where we. Don'T have sales representatives and they're coming through regular way retail as well. But the majority are coming through our RX Connect partner pharmacies. And if you look at sort of a mix, you know, it is largely commercial, as we would expect, still very early and the end is just too. Small to really see where it's going to settle out. But it's shaping up to resemble the. Market at large in terms of split. Between commercial and government, which I'll remind you, generally speaking is in the 60:40. Split in favor of commercial. We're not seeing quite that split. We're heavier towards the commercial piece, as we would expect just given our footprint. And again, the early stage of launch.
OPERATOR
But that's generally how it's laying out. But yeah, RX Connect is definitely doing its job and that's where the substantial. Majority of prescriptions are being filled.
Ed Wu
Thanks for taking my questions.
Josh Disbrow
Thank you. Thank you. And once again everyone, if you have any questions or comments, please press Star then 1 on your phone. Your next question is coming from Ed Wu from Ascendian Capital. Your line is live. Yeah, thank you. And congratulations on the progress. My question is going also on the supply issue. You mentioned a little bit of weather issue that may have effect, you know, getting inventory into the channel. Has that been corrected now? And also, do you have any issues potentially in terms of how much you could ramp up if demand does increase faster than you expect? Yeah, good question. It has been corrected. I mean, we, when I think about. Delays from the distributors, for example, into the pharmacies, you know, we're talking, you. Know, a couple few days delay. We're not talking weeks necessarily. So they, you know, almost without exception kind of cleared the channel. And so we've, we've got sort of adequate supply. And in terms of can we do. We have adequate to supply to ramp? Absolutely. I mean, we were very prudent in how we organize the initial production runs. To ensure that we've adequate for the very near term really through this entire. Calendar year and beyond. And we have API stateside at the manufacturer. We have componentry needed to produce multiples. Of what we've already produced. And so we have zero issues being able to scale appropriately if demand outstrips even our most optimistic forecast, will be fine with the supply that we have already stateside at our contract manufacturer. That's great to hear. I wish you guys thanks for asking my questions and I wish you guys good luck.
Ed Wu
Thank you.
OPERATOR
Thank you, Ed. Thank you. That does conclude our Q and A session. I'll now hand the conference back to management for closing remarks. Please go ahead.
Josh Disbrow
Great. Thank you. And thanks again everyone for joining us on today's conference call. As mentioned, and hopefully you can hear this, we remain very excited and highly convicted about the market potential for EXUA and are already seeing in real time the tremendous interest from the psychiatry community. It's really been exciting. So looking forward to sharing more and speaking with you next quarter following what will be our first full quarter of EXUA commercial availability. So until then, thanks again for joining us. Thanks for your interest and have a good evening.
OPERATOR
Thank you, everyone. This concludes today's event. You may disconnect at this time and have a wonderful day. Thank you for your participation.
Summary
Aytu BioPharma reported net revenue of $15.2 million for the quarter, with ADHD portfolio net revenue at $13.2 million, reflecting a slight decrease due to a strategic shift towards launching EXUA.
The company launched EXUA, the first FDA-approved 5HT1A agonist for treating major depressive disorder (MDD), with early prescriptions written in 27 states and positive initial feedback from patients.
The commercial launch of EXUA is supported by a targeted marketing strategy, including a strong sales team and RX Connect platform to ensure patient access and minimize costs.
Gross margin decreased to 63.5% due to transition-related expenses, but excluding a $600,000 inventory write-down, it would have been 67.4%.
Management emphasized a cautious approach towards expanding the salesforce, contingent on achieving profitability and cash flow from EXUA sales.
The company has $30 million in cash and cash equivalents, with ongoing investments focused on EXUA's launch and a reduced marketing approach for its ADHD and pediatric portfolios.
Disclaimer: This transcript is provided for informational purposes only. While we strive for accuracy, there may be errors or omissions in this automated transcription. For official company statements and financial information, please refer to the company's SEC filings and official press releases. Corporate participants' and analysts' statements reflect their views as of the date of this call and are subject to change without notice.