Earnings call transcript: ANI Pharmaceuticals beats Q3 2025 expectations

ANI Pharmaceuticals Inc. (ANIP) reported stronger-than-expected earnings for the third quarter of 2025, with earnings per share (EPS) reaching $2.04, surpassing the forecast of $1.76. The company's revenue totaled $227.8 million, exceeding expectations of $211.92 million. Despite this positive performance, the stock price fell 1.61% in pre-market trading, closing at $89.11.

Key Takeaways

• ANI Pharmaceuticals reported a 53.6% year-over-year increase in revenue for Q3 2025.
• The company achieved a 15.91% EPS surprise, beating analyst expectations.
• Cortrophin Gel revenues surged 93.8%, contributing significantly to the overall growth.
• The stock price declined by 1.61% in pre-market trading despite strong financial results.

Company Performance

ANI Pharmaceuticals demonstrated robust performance in the third quarter of 2025, driven by significant growth in its rare disease segment, particularly Cortrophin Gel. The company expanded its sales force and optimized its sales territories, focusing on rare diseases and ophthalmology. This strategic focus has led to substantial revenue growth and improved market positioning, even as the broader pharmaceutical industry faces challenges.

Financial Highlights

• Revenue: $227.8 million, up 53.6% year-over-year
• Earnings per share: $2.04, up from $1.34 in the previous year
• Adjusted non-GAAP EBITDA: $59.6 million, a 69.8% increase
• Unrestricted cash: $262.6 million
• Gross leverage: 3x; Net leverage: 1.7x

Earnings vs. Forecast

ANI Pharmaceuticals reported an EPS of $2.04, significantly higher than the forecasted $1.76, resulting in a 15.91% surprise. Revenue also exceeded expectations, coming in at $227.8 million compared to the $211.92 million forecast, marking a 7.5% revenue surprise. This performance marks a continuation of the company's positive trend in exceeding market expectations.

Market Reaction

Despite the impressive earnings beat, ANI Pharmaceuticals' stock price dropped 1.61% in pre-market trading, closing at $89.11. This decline occurred in the context of a broader market that has been volatile, with investors possibly reacting to other external factors or concerns about future growth sustainability. The stock remains below its 52-week high of $99.5.

Outlook & Guidance

Looking forward, ANI Pharmaceuticals has set its net revenue guidance for 2025 at $854-$873 million, projecting a growth rate of 39-42%. The company anticipates continued growth in its Cortrophin Gel product line, with expected revenues of $347-$352 million. ANI Pharmaceuticals is also optimistic about the potential recovery of Iluvien in 2026.

Executive Commentary

CEO Nikhil Lalwani emphasized the strategic focus on rare diseases as a primary growth driver, stating, "Rare disease remains our top strategic area and primary driver of growth." Chris Mutz, SVP of Rare Disease, highlighted the long-term potential of Cortrophin, noting, "We believe that there is significant multi-year growth opportunity for Cortrophin in 2026 and beyond."

Risks and Challenges

• Potential impact of Medicare Part D redesign on revenues
• Reliance on key products like Cortrophin Gel for growth
• Competitive pressures and market saturation in the pharmaceutical industry
• Regulatory challenges in expanding product labels
• Macroeconomic factors affecting healthcare spending

Q&A

During the earnings call, analysts inquired about the impact of Medicare Part D redesign, the strategy behind sales force expansion, and the potential for further label expansions. The management addressed these concerns, highlighting the durability of the Cortrophin Gel market position and the strategic alignment of their sales initiatives.

Full transcript - ANI Pharmaceuticals Inc (ANIP) Q3 2025:

Chris Mutz, Senior Vice President and Head of Rare Disease Business, ANI Pharmaceuticals: Good morning, everyone, and welcome to today's ANI Pharmaceuticals' third quarter 2025 earnings results call. Please note this call is being recorded. After the speaker's opening remarks, there will be a question-and-answer session. If you would like to ask a question during this time, simply press star, then the number one on your telephone. We ask that you please limit yourself to one question. If you would like to withdraw your question, please press star, then the number two. It is now my pleasure to turn the conference over to Ms. Courtney Mogerly, Investor Relations. Please go ahead, ma'am.

Courtney Mogerly, Investor Relations, ANI Pharmaceuticals: Thank you, Operator. Welcome to ANI Pharmaceuticals' Q3 2025 earnings results call. This is Courtney Mogerly, Investor Relations for ANI. With me on today's call are Nikhil Lalwani, President and Chief Executive Officer, Stephen Carey, Chief Financial Officer, and Chris Mutz, Senior Vice President and Head of ANI's Rare Disease Business. You can also access the webcast of this call through the Investors section of the ANI website at anipharmaceuticals.com. Before we get started, I would like to remind everyone that any statements made on today's conference call that express a belief, expectation, projection, forecast, anticipation, or intent regarding future events and the company's future performance may be considered forward-looking statements as defined by the Private Securities Litigation Reform Act.

These forward-looking statements are based on information available to ANI Pharmaceuticals Management as of today and involve risks and uncertainties, including those noted in our press release issued this morning and our filings with the SEC. Such forward-looking statements are not guarantees of future performance. Actual results may differ materially from those projected in the forward-looking statements. ANI specifically disclaims any intent or obligation to update these forward-looking statements except as required by law. The archived webcast will be available for 30 days on our website, anipharmaceuticals.com. For the benefit of those who may be listening to the replay or archived webcast, this call was held and recorded on November 7, 2025. Since then, ANI may have made announcements related to the topics discussed, so please reference the company's most recent press releases and SEC filings. I will turn the call over to Nikhil Lalwani.

Nikhil Lalwani, President and Chief Executive Officer, ANI Pharmaceuticals: Thank you, Courtney. Good morning, everyone, and thank you for joining us. The third quarter was another remarkable quarter for ANI Pharmaceuticals, marked by record revenue, adjusted EBITDA, and adjusted EPS, all driven by continued momentum across our rare disease and generics business units. We grew total company revenues by 54% year over year and 46% on an organic basis. In addition, we nearly doubled Cortrophin Gel net revenue compared to the third quarter of 2024 and generated adjusted EBITDA growth of 70% year over year. Based on our very strong third quarter performance and future outlook, we are pleased to raise our top and bottom line 2025 financial guidance. Compared to 2024, we now expect to grow 2025 net revenues 39%-42% and 34%-37% on an organic basis, with rare disease becoming essentially half of our total revenues for the year.

We expect our lead rare disease asset, Cortrophin Gel, to grow 75%-78% year over year to generate revenues of $347 million-$352 million. We expect to grow adjusted EBITDA between 42% and 46% compared to 2024. Later in the call, Steve will provide more detail on our increased guidance. Growing our rare disease business is a top strategic priority for us, creating long-term value for our stakeholders and advancing our purpose of serving patients, improving lives. Turning to our lead rare disease asset, Cortrophin Gel. To drive strong multi-year growth, we are focused on clinical evidence generation to support physician decision-making, investments to enhance patient convenience, and high ROI commercial efforts to drive growth. Our team has made significant progress on these initiatives to grow Cortrophin Gel across our target specialties.

In the first quarter, we expanded our portfolio sales team, and we're seeing very positive results highlighted by our strong momentum in new cases initiated and growth in new patient starts. We also launched the prefill syringe in the second quarter, reducing administration steps for patients. We're seeing sizable increased demand for the prefill syringe and expect it to be an important growth driver. Importantly, to support our commercial team's efforts to drive awareness for Cortrophin Gel, we are committed to generating data to help clinicians, patients, and payers make informed treatment decisions, including a phase four clinical trial in acute gouty arthritis flares, preclinical data on Cortrophin Gel's mechanism of action across multiple disease states, and presentations and publications at prominent medical meetings. We remain confident in the strong multi-year growth trajectory of Cortrophin based on multiple factors.

The ACTH market has returned to growth following the launch of Cortrophin in 2022 and is expected to increase approximately 40% to $957 million in 2025, with Cortrophin growing by 75%-78%. Despite this growth, we believe that the addressable patient populations across key indications are significantly underpenetrated. For example, the addressable patient population for acute gouty arthritis alone is 285,000 patients, an indication that is unique to Cortrophin Gel's label. Importantly, the number of Cortrophin Gel prescribers who were previously naive to ACTH represents approximately half of our total prescriber base, and this group continues to grow. Turning now to our retina portfolio, Iluvien's sales in the third quarter were lower due to the further impact from the continued reduced access for Medicare patients and the utilization of the remaining YUTIQ units at physician offices.

In addition, adoption of Iluvien for NIUPS began in the third quarter, and the company continued to make tangible progress toward full adoption of the label transition. We see 2025 as a reset year for Iluvien and believe that we can grow in 2026 and beyond for several reasons. First, we believe the addressable patient populations for Iluvien in both DME and NIUPS are at least 10X the current number of patients treated with Iluvien. Second, we expect to see the ensuing results of our strengthened and more experienced ophthalmology organization that is coalescing and deploying an expanded peer-to-peer education program, speaker education program, and new marketing initiatives. In addition, we continue to disseminate and contextualize findings of the New Day clinical study and create greater awareness on the potential use of Iluvien.

Lastly, we are seeing signs that there is a growing number of physician offices exploring alternative access pathways, including Medicare Part D through specialty pharmacy. This is the path we use for Cortrophin. Moving now to our genetics business, we had a very strong third quarter performance due to an opportunistic partner genetic launch that occurred in the second half of the third quarter. This launch once again highlights our strength in creativity, R&D, business development, operations, and execution intrinsic to ANI's genetics business, and we will continue to leverage these strengths to unlock future opportunities. Based upon upside from this launch, we expect genetics growth for the full year in the low 20% range. We're proud of the continued execution of our genetics business and how it provides ongoing foundational support that enables us to invest in our initiatives to grow our rare disease business.

In summary, we delivered another record quarter driven by strong performance across our rare disease and genetics business. As we head into 2026, we expect our virtuous cycle of growth to persist. Rare disease is our primary focus area and largest driver of growth. We expect continued strong momentum in Cortrophin and positive impact from multiple initiatives outlined to grow Iluvien in 2026. In addition, we will continue to explore inorganic opportunities to expand the scope and scale of our rare disease business. These efforts will be supported by continued performance in our genetics and brands business. I'll now turn the call over to Chris Mutz to discuss our rare disease business in more detail. Chris.

Chris Mutz, Senior Vice President and Head of Rare Disease Business, ANI Pharmaceuticals: Thank you, Nikhil, and good morning, everyone. Echoing Nikhil, our rare disease team delivered another excellent quarter marked by continuing record demand for Cortrophin Gel. The number of cases initiated and new patient starts reached another record high, and we saw broad-based growth across all of our targeted specialties: rheumatology, nephrology, neurology, pulmonology, and ophthalmology. To capture the multi-year growth opportunity for Cortrophin Gel, we are focused on three key priorities. First, we are investing in high ROI commercial initiatives to fuel growth. In the first quarter of 2025, we expanded our portfolio sales force by approximately one-third, further optimizing their territories. Our expanded portfolio sales team added new prescribers and drove meaningful increases in new patient starts across our core specialties during the third quarter.

In addition, our specialty-focused teams produced sizable growth in our newer areas of pulmonology and ophthalmology, and we believe we are still in the early stages of penetrating these therapeutic areas. Cortrophin Gel prescribing for acute gouty arthritis flares remained a key driver in the third quarter. Notably, the acute gouty arthritis indication is unique to Cortrophin Gel's label among ACTH therapies and accounts for over 15% of Cortrophin Gel use. Further, the gout indication has contributed significantly to the growth of new prescribers, many of whom are historically unfamiliar with ACTH. Turning to ophthalmology, we continue to realize meaningful revenue synergies and saw a record number of new patient starts and a 42% sequential quarterly increase in Cortrophin volumes. We believe there is further growth potential to expand awareness of Cortrophin for patients with severe allergic and inflammatory eye conditions. Additionally, we continue to strive to enhance patient convenience.

Our new Cortrophin prefill syringe offering, which we launched in April, provides a simplified administration that we believe has been well received by patients and prescribers. The prefill syringe continues to be an important growth driver for Cortrophin Gel. Finally, we are investing in clinical evidence generation to support physician decision-making. As previously announced, we're conducting a phase four trial in acute gouty arthritis flares. We believe the 150-patient study will provide physicians with valuable insight on the treatment of acute gouty arthritis flares with Cortrophin Gel and could support positioning and treatment guidelines. We continue to generate robust preclinical data for our key stakeholders on Cortrophin's differentiated mechanism of action across multiple disease states. This is an important growth initiative as we believe increasing the body of evidence supporting Cortrophin Gel's use across indications will help physicians make further informed treatment decisions.

Our preclinical study of Cortrophin Gel in uveitis that was presented earlier this year has been published in Ophthalmology and Inflammation. We also had a poster at the American College of Rheumatology 2025 annual meeting that highlighted preclinical data supporting the use of Cortrophin Gel for the treatment of inflammatory arthritis and its anti-inflammatory mechanism of action. Additionally, a manuscript for a preclinical study of Cortrophin Gel in membranous nephropathy was accepted for publication in Molecular Therapy. The study demonstrates the steroid-independent mechanism of action of Cortrophin Gel in an animal model of membranous nephropathy, specifically its effect on the complement system, areas of significant interest in ongoing membranous nephropathy drug development. Subsequently, this publication was highlighted in a commentary paper in Molecular Therapy and presented at the American Society of Nephrology meeting. Turning to our retina franchise, we are making progress on multiple initiatives to improve Iluvien sales.

Our commercial team is fully hired, onboarded, and dedicated to educating and supporting the retina community. We are strengthening our promotional efforts, including a ramp-up of new peer-to-peer educational speaker programs and the continued execution in the field with new marketing materials to increase the understanding among retina physicians of Iluvien and its two indications. In mid-June, we began promoting Iluvien under the combined label for chronic NIUPS and DME. Our sales teams are educating customers across the country, and our market access team has worked with payers to establish coverage for Iluvien's new chronic NIUPS indication. Six of the seven Medicare administrative contractors, or MACs, have updated their policy to cover Iluvien for NIUPS, and we are working with the other contractors to update their policy.

Among the top 20 commercial payers, all payers who have a policy specific to Iluvien have updated it to reflect both DME and NIUPS indications. We continue to receive positive clinician feedback on the convenience of a single product covering both indications. Next, we have initiatives in place to help physician practices navigate the market access challenges for Medicare patients that have persisted since January 2025. As a reminder, patient support foundations such as Good Days did not receive sufficient funding for 2025, which affected their ability to assist Medicare patients with copay support across retina products broadly. Our team has been gaining traction with HCPs, with leading retina practices exploring the pathway to get Iluvien accepted for appropriate eligible patients through Medicare Part D benefits using a specialty pharmacy. This is the same approach used for access to Cortrophin.

In addition, we continue to present the results of our New Day study of Iluvien in patients with DME at numerous prominent medical meetings. This includes a late-breaking oral presentation at the American Academy of Ophthalmology 2025 meeting, a presentation at the American Society of Retina Specialists annual meeting, and an oral presentation at the EU Retina Innovation Spotlight 2025 meeting. Looking forward, we are preparing to present these data at additional upcoming conferences to further disseminate and contextualize these findings. With that, I'll turn the call over to Steve for the financial update. Steve? Thanks, Chris, and good morning to everyone on the call. Today, I'll review our third-quarter results and our revised guidance in more detail. We delivered strong top and bottom-line growth, generated significant cash flows, and are raising our 2025 financial guidance based on our exceptional performance this quarter.

ANI generated revenues of $227.8 million in the third quarter, up 53.6% over the prior year period. Revenues from rare disease and brands were $129.1 million in the third quarter, nearly double the prior year period on an as-reported basis and up 82.2% on an organic basis, driven by growth in our rare disease franchise. Rare disease revenues were $118.5 million, up 109.9% from the prior year. Revenues from Cortrophin Gel were $101.9 million, up 93.8% from the prior year period, driven by increased volume on a record number of new patient starts. Iluvien net revenues were $16.6 million. Revenues for brands were $10.7 million in the third quarter, up 16.1% versus the prior year period due to an increase in demand for certain products. News were down $2.5 million as we saw the expected trend toward normalization in demand during the quarter.

We expect that the normalization trend will continue and therefore expect modestly lower demand in the fourth quarter. Revenues for our generics and other segment were $98.7 million, an increase of 19.3% over the prior year period. Revenues for generics were $94.4 million, an increase of 20.6% over the prior year period, driven by the successful launch of a partner generic product in the second half of the third quarter. They overcame our previous expectation for a sequential dip in generics. Generics were up $4.1 million as compared to the second quarter of 2025 due to the strength of this launch. Note that the gross margin for this partner generic product is lower than typical gross margin for our generics portfolio, given the profit share element with our partner. Now moving down the P&L.

As a reminder, when I speak to operating expenses, I will be referring to our non-GAAP expenses, which are detailed in table three of our press release. Generally, our non-GAAP operating expenses exclude depreciation and amortization, stock-based compensation, certain costs related to litigation and M&A activity, as well as certain non-cash charges. Please refer to table three for a reconciliation to our GAAP expenditures. Non-GAAP cost of sales increased 56% to $92.9 million in the third quarter of 2025 compared to the prior year period, primarily due to net growth in sales volumes and significant growth of loyalty-bearing products. Non-GAAP gross margin was 59.2%, a decrease of 63 basis points from the prior year period, principally due to product mix, including the lower gross margins on our partner generic product.

Non-GAAP research and development expenses were $11.8 million in the third quarter, an increase of 36% from the prior year period, driven by higher investment to support future growth of our rare disease and generics businesses. Non-GAAP selling, general and administrative expenses increased 41.1% to $63.6 million in the third quarter, driven by spend for our new larger ophthalmology sales team promoting Cortrophin Gel and Iluvien, and continued investment in rare disease sales and marketing activities, including the expansion of the rare disease team in the first quarter. Adjusted non-GAAP diluted earnings per share was $2.04 for the third quarter compared to $1.34 per share in the prior year period. Adjusted non-GAAP EBITDA for the third quarter was $59.6 million, up 69.8% compared to the prior year period.

We ended the third quarter with $262.6 million in unrestricted cash, up from $217.8 million at the end of the second quarter and $144.9 million as of December 31 of the prior year. Cash flow from operations was $44.1 million in the third quarter of this year and $154.9 million on a nine-month year-to-date basis. As of September 30, we had $633.1 million in principal value of outstanding debt, inclusive of our senior convertible notes and term loan. At the end of the third quarter, our gross leverage was three times, and our net leverage was 1.7 times our trailing 12-month adjusted non-GAAP EBITDA of $214.5 million. During the third quarter, we concluded our 2021 PIPE financing transaction with Ampersand by converting all previously issued 25,000 shares of Series A convertible preferred stock to 602,900 shares of common stock.

As of September 30, 2025, balance sheet, there were no further shares of Series A convertible preferred outstanding, and all mandatory dividends were paid in full. Now turning to our updated 2025 financial guidance. We are raising our guidance for total revenue, adjusted non-GAAP EBITDA, and adjusted non-GAAP EPS based upon higher estimates for Cortrophin Gel net revenue and the continued outperformance of our generics business, while tempering our Iluvien estimates. Our updated guidance is as follows. Full year 2025 net revenue of $854 million-$873 million, up from our prior guidance of $818 million-$843 million, representing year-over-year growth of approximately 39%-42%. Cortrophin Gel net revenue of $347 million-$352 million, up from our prior guidance of $322 million-$329 million, representing year-over-year growth of 75%-78%, driven by continued volume gains.

We continue to expect sequential growth of Cortrophin revenues in the fourth quarter. Combined Iluvien and YUTIQ net revenue, $77 million versus our prior guidance of $87 million-$93 million. This guidance assumes no meaningful change in the copay funding gaps facing Medicare patients in retina for the remainder of the year. Generics revenue growth in the low 20% range, driven by strong contribution from new product launches. We expect generics revenue in the fourth quarter to be down on a sequential basis due to competitive entrance into the market in which our third-quarter partnered product competes in. Adjusted non-GAAP EBITDA of $221 million-$228 million, up from our prior guidance of $213 million-$223 million, representing year-over-year growth of approximately 42%-46%. Adjusted non-GAAP earnings per share between $7.37 and $7.64, up from our prior guidance of $6.98 and $7.35.

We are revising our full fiscal year guidance for adjusted gross margin to 61%-62% compared to our previous guidance of 63%-64%, driven by the revised revenue mix in this morning's guidance with lower Iluvien and higher generics forecast as compared to our previously issued guidance. We currently anticipate a full year U.S. GAAP effective tax rate of approximately 21%-22%. Consistent with prior quarters, we will tax-effect non-GAAP adjustments for computation of adjusted non-GAAP diluted earnings per share using our estimated statutory rate of 26%. We now anticipate between 20.5 million and 20.7 million shares outstanding for the purpose of calculating full year non-GAAP diluted EPS.

Please note that in periods in which ANI common share price is greater than the conversion price of our underlying convertible debt of $74.11 and lower than the conversion price of our corresponding capped call transaction of $114.02 per share, we will exclude from our adjusted non-GAAP diluted EPS calculation the dilutive shares included in the GAAP diluted EPS calculation, which are expected to be offset in full by the capped call transaction. The third quarter was the first reporting period in which this condition exists. With that, I'll turn the call back to Nikhil. Thank you, Steve. In closing, we've made exceptional progress as we continue to execute our strategic priorities. Rare disease remains our top strategic area and primary driver of growth, and we'll focus our efforts on driving further growth in Cortrophin and improving Iluvien performance.

We are encouraged by our performance this quarter, having reached more patients with our portfolio of high-quality medicines, nearly doubling Cortrophin Gel net revenues compared to the third quarter of 2024, and significantly growing both the top and bottom line. Made possible by the efforts of our employees, customers, suppliers, and investors, and their dedication to our mission of serving patients, improving lives. Operator, please open the line for questions.

Nikhil Lalwani, President and Chief Executive Officer, ANI Pharmaceuticals: Certainly, Mr. Lalwani, thank you. Ladies and gentlemen, at this time, if you do have any questions, please press star one. You can always remove yourself from the queue by pressing star two. Again, we do ask that you please limit yourself to one question. We'll go first this morning to Dennis Bing of Jefferies.

Hi, good morning. Thanks for taking my question. One on Cortrophin. Medicare Part D redesign lowered the catastrophic coverage limit this year, and that's been a big tailwind. That also makes for a really tough comp next year where growth should be driven more organically and through expanding the breadth of prescribers. Do you agree with that take? I guess, how much confidence do you have that you're able to do that with the sales force you have currently? Thank you.

Chris Mutz, Senior Vice President and Head of Rare Disease Business, ANI Pharmaceuticals: Good morning and thank you, Dennis. I think I'll take your question in two parts. First is, what's the impact of IRA on 2025? Then how do we see this going forward? I think, as you pointed out, IRA improved affordability and access for appropriate patients to needed medicines by capping the copays at $2,000, as well as introducing the ability to evenly spread the payments throughout the year. We did see a modest tailwind from that. This is consistent with what we've said in the prior quarter. The reason it's modest is while this did get additional patients on therapy, it was tempered by the mandatory Medicare manufacturer payments that we need to make. Overall, Cortrophin saw a modest net positive impact from the Part D redesign through IRA.

As far as your second question on next year and going forward, look, we believe that there is significant multi-year growth opportunity for Cortrophin in 2026 and beyond. That is driven by really the strong underlying demand. The demand sort of is centered in the addressable populations, right? Addressable patient populations across key indications are significantly underpenetrated. For acute gouty arthritis alone, it is about 285,000 patients. Our ability to expand the market is highlighted by the fact that approximately half of our prescribable base had never used ACTH therapy before. As Chris had mentioned in his remarks, we continue to see growth from both the existing prescribers as well as new prescribers. We remain confident of being able to reach the appropriate patients in need by working with the HCPs. Thank you, Dennis.

Nikhil Lalwani, President and Chief Executive Officer, ANI Pharmaceuticals: We'll go next now to Cecil Kershed at Leerink Partners.

Hey, guys. Thanks for taking the question. Could you speak a little bit more to what this kind of new partner generic product is, and then also what you expect for that in the fourth quarter and kind of going into 2026 as well? And then I will run after Cortrophin as well.

Chris Mutz, Senior Vice President and Head of Rare Disease Business, ANI Pharmaceuticals: Sure. Good morning and thank you, Cecil. For competitive reasons, we're not specifying the name of the partner generic. It's a product that we launched, obviously, as it's intended with another manufacturer. We're able to capture, be the sole generic for a period of time, a majority of which was in Q3. In Q4, we have seen some competition enter on that product. That is why our guidance for Q4 for generics is showing a sequential drop versus the much higher Q3 that we had. Because it's a partner generic, it also has profit share in it, and therefore the gross margins on that product are lower. Going into 2026, we will see at least the existing competition continue. We look forward to updating you more on the guidance for 2026 in early next year.

Got it. Okay. And then on Cortrophin, are there any inventory or gross-to-net situations that we should be aware about? Just because it seems like the volume growth kind of outpaced the actual dollars growth in this quarter.

No. The Cortrophin Gel growth is driven by strong underlying demand, highest number of new patient starts and new cases initiated since launch, growth across all targeted specialties, the expanded portfolio sales force that we did in the first quarter drove growth in nephrology, neurology, and rheumatology. Gout, which is one of the newer target specialties, now represents 15% of Cortrophin Gel use. That contributed significantly to the growth, in fact, to the growth not just in Cortrophin volume, but also to the growth of ACTH naive prescribers. The combined ophthalmology sales force continued to build momentum with a 42% increase in volume versus the second quarter of 2025. Underlying, just from a presentation perspective, there is strong demand for the prefill syringe, with it accounting for almost 70% of the new cases initiated. It is strong underlying demand that is driving the growth in Cortrophin.

Got it. Thank you.

Thank you, Cecil. Yeah.

Nikhil Lalwani, President and Chief Executive Officer, ANI Pharmaceuticals: We'll go next now to David M. Selam at Piper Sandler.

Thanks. Just a couple of quick ones from me. I'm sorry if I missed this earlier in the prepared remarks. Can you talk about, regarding Cortrophin, the growth trajectory in pulmonology and what portion of the mix that is? I think you talked about the other therapeutic areas. Secondly, just given the wide label and all the different indications, where do you envision untapped opportunities that aren't really a big part of the current mix for the product? Lastly, I know this is a priority, but just wanted to get your latest thoughts on business development and M&A and how large of a transaction you'd contemplate given the current capital structure. Thank you.

Chris Mutz, Senior Vice President and Head of Rare Disease Business, ANI Pharmaceuticals: Yeah. Good morning and thank you, David. Pulmonology and sarcoidosis is an important therapeutic area for us. We have a dedicated, a smaller team, but dedicated for pulmonology. We are seeing a growth in that area too. Again, it is a smaller part of the overall Cortrophin picture at this time, but there is significant growth opportunity there. In pulmonology, we see a larger number of vials per patient. I think that is another factor that makes pulmonology an important area for us. That is on pulmonology. Regarding the wide label, look, I think currently, as you have seen, the addressable patient populations and the indications that we are addressing today is much larger than anything that we are penetrating today. Our immediate focus is, or near-term focus is on tapping these different opportunities. It is across the board, right? Neurology, nephrology, rheumatology. We talked about gout.

We talked about ophthalmology, the quarter-on-quarter growth. There are multiple areas. Part of, as we think, as Chris thinks about where to drive the growth is where to make the high ROI commercial investments to achieve that growth. Because there is really, we are fortunate that there are opportunities across specialties and that we are able to drive growth through existing prescribers as well as have new prescribers who never, some that are naive to ACTH and some that were not even familiar with ACTH, adopt Cortrophin or use them in their treatment paradigm for appropriate patients. Lastly, to your question on BD, we continue to explore opportunities to expand scope and scale of rare disease business.

I think that our filters are similar to what they were last time, which is at this time, which is late stage or close to commercial or commercial and synergistic with either our sales force, right? So call point synergy, as was in the case of Alimera, or leveraging the rest of our rare disease infrastructure, right? Which is the market access, patient support, specialty pharmacy distribution, and across the board there. That's how we think about BD efforts. We're continuing to explore opportunities. As I said, as I highlighted, if you look at even the growth this year, we had 34%-37% growth based on our guidance organically, right? There's significant growth opportunity both in Cortrophin and Iluvien. We're not in a hurry to do a deal.

We're wanting to make sure that we do the right deal as we expand the scope and scale of our rare disease business. Thank you, David.

Nikhil Lalwani, President and Chief Executive Officer, ANI Pharmaceuticals: We'll go next now to Vamil Dhiven at Guggenheim.

Hi, great. Yeah, this is Daniel on for Vamil. Thanks for taking our questions and clearing out the quarter. Maybe just one question on Cortrophin. Maybe if you could expand a little bit on what exactly currently is driving doctors to use this drug across these various indications. I know you mentioned that you're focused on generating more evidence around this mechanism now, but maybe currently, with what you have, who are the patients that doctors think are the right ones for Cortrophin versus other alternatives that are available for each of these different conditions? Thanks.

Chris Mutz, Senior Vice President and Head of Rare Disease Business, ANI Pharmaceuticals: Sure. Good morning and thank you, Daniel. I'll start and then I'll skip and Chris can jump in. Cortrophin is a late-line treatment for appropriate patients for which other therapies have been sort of less effective and the real sort of the standard of care and the treatment options that are varying by, I guess, by specialty and by indication. When it fits into the treatment algorithm, it sort of varies. Essentially, it's a late-line treatment option. It's used also for patients that have this nonsteroidal mechanism of action, used for patients that are refractory to steroids or have a high side effect profile. Chris, would you like to add anything?

Yeah, no. I'd just say taking care of patients with autoimmune disorders is challenging. Thank goodness there are a lot of great options for physicians to use, right? These modifying therapies, new innovations across the spectrum and the patients we serve. There are still select patients that are really tough to take care of. Physicians are coming to the kind of end of the road in terms of good options for those patients that they can rely on. There is a significant number of those patients, as we've outlined, who need something different and a new choice of treatment. I think that's where we focus. We think that's a large patient population. It's a difficult-to-treat patient population. We are just getting started.

Thank you, Daniel.

Nikhil Lalwani, President and Chief Executive Officer, ANI Pharmaceuticals: We'll go next now to Gary Nockman with Raymond James.

Hey, thanks. And congrats on another strong quarter. Back on Cortrophin, you just added reps and a good ROI on that immediately. Is this market really that promotion-sensitive? Maybe just characterize that a bit more. Are there still some pockets where you could add more reps? Would you do that in the near term given the great returns there? The prefilled syringe seems to be having a big impact on the acceleration. Was administration really that much of a factor that previously held back use? Just explain more why you're seeing such a benefit from the prefilled syringe helping growth. Thanks.

Chris Mutz, Senior Vice President and Head of Rare Disease Business, ANI Pharmaceuticals: Yes, thank you. I think, Gary, to your good morning, Gary, and thank you for your questions. First question on the effect of an impact of sales reps. I would say that the way we think about it is we expanded our the underlying patient demand is very high, right, versus anything that we're capturing. There are opportunities to reach prescribers, right, that with our sales force, there's opportunities to get in front of more prescribers and spend more time with them that we can keep building on where we are. If you looked at, if you think about where we expanded the sales force, we had a combined sales force detailing into neurology, nephrology, and rheumatology. As you can imagine, that even within a territory, it's tough to cover all three indications. We expanded the number of sales reps in that area.

What that did is it reduced what's called windshield time, allowing the reps to spend more time speaking with docs about Cortrophin. Yes, there is opportunity across specialties, across indications as we think about increasing awareness for the appropriate patients of Cortrophin. There's certainly opportunity to do that across multiple areas, right? Across the portfolio area, across gout, across ophthalmology. Ophthalmology, I think we're set with the combined sales force we have right now. There's opportunities across multiple specialties and something that we're continuing evaluating, high ROI commercial efforts there. Your second question on prefilled syringe, yeah, look, when we launched the prefilled syringe, we had expected the prefilled syringe would be used for patients that had dexterity issues or issues with their eyesight.

As we're seeing this much greater adoption, and it's across specialties, I think when given an option, I think prescribers are just prescribers and patients are choosing the reduced administration step. Because in the original or in the 5 mL vial, there are two steps to the administration. You have to obviously draw the drug from the vial and then administer it. And I have to use two different needles for doing so. So a prefilled syringe is, it reduces that step in administration and is therefore driven more widespread adoption. What it has done is there are prescribers that are sort of willing to try a prefilled syringe, probably a bit more than going to a 5 mL vial that requires, which is a larger use.

I mean, essentially, the growth is coming from the strong underlying demand, which would have been there also with the 5 mL vial and the 1 mL vial, the other presentations that are there. The adoption of the prefilled syringe has been driven by just the reduced steps of administration. Yeah. Thank you, Gary.

Thank you very much.

Nikhil Lalwani, President and Chief Executive Officer, ANI Pharmaceuticals: Thank you. We'll go next now to Ekaterina Niaskovna at JP Morgan.

Thanks so much and congrats on the quarter. Just a quick one from me. Just remind us how you're thinking about the durability of Cortrophin Gel over time. Just latest thoughts on the possibility of potential generic competition eventually emerging. I'm not talking like next year, like 5, 10, 15 years from now. I think there's obviously a lot of barriers to entry there. Just I guess as this class is becoming bigger and probably garnering more attention from potential generic manufacturers. Thanks.

Chris Mutz, Senior Vice President and Head of Rare Disease Business, ANI Pharmaceuticals: Sure. Good morning and thank you, Ekaterina. Yeah, the benefit of having a capability in generics ourselves is we're able to sort of, pretty much, we have expertise and capability in assessing the pathway to developing a generic. Our position sort of stays that given this is porcine-derived and the mix of and the formulation that it is, what it will take to actually develop a generic, it's a very tough pathway. That is why while many folks have tried it and have not succeeded, it's a very complex development. There are examples of products like this that are tough to genericize. We continue to believe in the long-term durability of either ACTH product being tough to genericize.

Thank you.

Yeah, sorry. One other thing I would highlight is both us and the competitor have also added patents, strengthened our IP around the products that go into the 2040s. That is another point on durability. Thank you, Ekaterina.

Nikhil Lalwani, President and Chief Executive Officer, ANI Pharmaceuticals: Thank you. We'll go next now to Brandon Folks with HC Wainwright.

Hi, thanks for taking my questions and congrats on another good quarter. Nikhil, just following on from that prior question, can you just remind us of the challenges of label expansion in the ACTH category for these products? Just sort of in the past, has this label expansion been a cost-benefit decision or practicality decision? Just sort of any color in terms of if this market does double, the confidence around maintaining exclusivity on gout as a label claim. Does that phase four data give you any potential additional IP around that? Thank you.

Chris Mutz, Senior Vice President and Head of Rare Disease Business, ANI Pharmaceuticals: Yeah, good morning and thank you, Brandon. I think that our interaction on your question on label expansion, our interaction with the FDA suggests that any label expansion will need to follow the current rules of the FDA, which requires a phase four, sorry, phase three clinical trial and all the associated rules that are in place today. That's what we'll need to do and that's what our competitor will need to do, whether that's us trying to, that's our understanding, whether that's us exploring infantile spasms, which is an indication they have that we don't, or us exploring or them exploring acute gouty arthritis flares.

The phase four data, look, that study was designed and is being executed more to inform and assist physicians in their treatment and hopefully in their treatment decisions and hopefully could be included in the treatment guidelines, which can drive sort of further adoption. Yeah. Thank you, Brandon.

Nikhil Lalwani, President and Chief Executive Officer, ANI Pharmaceuticals: Thank you. We'll go next now to Les Zielowski at Jefferies Securities.

Good morning. Thank you for taking my questions. Three from me. Just to touch on the sales force again, what are some of the KPIs that you're tracking to back the right sizing of this team? What trends have you seen in the sales per rep from the sales force expansion? Any of these metrics will drive your reasoning to potentially increase the sales force? Second, can you provide any more color around that partner generic program? Are there additional opportunities in similar scope, or is this a one-off situation? Third, maybe for Steve, as you close out the year, could we potentially anticipate an intangible asset impairment charge tied to the revaluation of the Alimera acquisition? Thank you.

Chris Mutz, Senior Vice President and Head of Rare Disease Business, ANI Pharmaceuticals: Right. Good morning and thank you for your questions, Les. I think first is on the sales force. We believe, on the KPIs, we try to share information that's helpful to investors and competitively sensitive. I'll steer away from the KPIs. On the trends, I mean, there's clearly expansion of the sales force in the appropriate areas is a high ROI commercial effort, as evidenced by the expansion that we did earlier this year for our portfolio sales team. That's something that we will continue to evaluate and explore as we move forward. On the partner generic, yeah, on the partner generic, there are definitely opportunities like that, ones that have been in the hopper, ones that we continue to work on.

It really just highlights our end-to-end capability, right, in BD, in R&D, in commercialization, and obviously in operational excellence. Across the board, I think we're uniquely positioned with our US manufacturing footprint, right, with more than 90% of our revenues coming from products that are made in the US, with our three manufacturing facilities that are in the US. We're uniquely positioned from that standpoint. We absolutely plan to and are already working on such opportunities to capture and to bring to market. On the, I think, the Iluvien long-term question, I think that there is our, so beyond Q4 and 2026, we believe the addressable patient population for Iluvien in both DME and NIUPS are at least 10x the current number of patients currently being treated with Iluvien.

We expect to see the results of our strengthened ophthalmology organization deploying the expanded peer-to-peer speaker education program and new marketing initiatives. In addition, we continue to disseminate and contextualize the findings of the NEW DAY clinical study and create greater awareness on the potential use of Iluvien. While we see 2025 as a reset year, we are confident in being able to drive growth in 2026 and beyond for Iluvien. Steve, I do not know if you want to add anything to Les' question with that backdrop.

Yeah, good morning. Good morning, Les. I would only add that we evaluate all of our intangible assets on a quarterly basis. The third quarter for Iluvien was no different. Obviously, passed that testing in the third quarter. As Nikhil just outlined, right, when we think about the mid to long-term forecast for the product, we remain confident in the mid to long-term opportunities as Nikhil just laid out. Very helpful.

Thank you, Les.

Thank you.

Thank you.

Nikhil Lalwani, President and Chief Executive Officer, ANI Pharmaceuticals: Thank you. Mr. Lalwani, it appears we have no further questions this morning. I would like to turn the conference back to you for any closing comments.

Chris Mutz, Senior Vice President and Head of Rare Disease Business, ANI Pharmaceuticals: Thanks, everybody, for joining. We look forward to updating you on our progress in the future. Thanks, everybody.

Nikhil Lalwani, President and Chief Executive Officer, ANI Pharmaceuticals: Thank you very much, Mr. Lalwani. Again, ladies and gentlemen, that will conclude today's ANI Pharmaceuticals third quarter earnings call. Again, thanks so much for joining us, everyone. We wish you all a great day. Goodbye.

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