Financial Data and Key Metrics Changes - Net revenue for the quarter was $15.2 million, down from $16.2 million in the prior year [20] - Gross margin decreased to 63.5% from 66.5% year-over-year, primarily due to decreased net revenue and transition-related expenses [21][22] - The company reported a net loss of $10.6 million, compared to a net income of $0.8 million in the prior year [23] Business Line Data and Key Metrics Changes - ADHD portfolio net revenue was $13.2 million, a slight decrease from $13.8 million in the prior year and flat compared to the previous quarter [20][16] - Pediatric portfolio revenue increased to $1.7 million from $715,000 in the previous quarter, but down from $2.7 million year-over-year [18][21] Market Data and Key Metrics Changes - Exxua prescriptions have been written in 27 states, with over 100 doctors prescribing it within the first month of launch [14][15] - The majority of prescriptions are being filled through the RxConnect platform, with a favorable mix towards commercial insurance [47] Company Strategy and Development Direction - The company has launched Exxua, the first FDA-approved 5-HT1A agonist for major depressive disorder, focusing on prescriber adoption and brand growth [4][31] - A comprehensive commercial launch strategy includes a motivated sales organization and targeted promotional efforts [10][11] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about Exxua's market potential and early positive feedback from patients and prescribers [31][15] - The company is focused on maintaining operational efficiency while ramping up Exxua's market presence [29] Other Important Information - The company has a cash balance of $30 million as of December 31, 2025, down from $32.6 million at the end of the previous quarter [25] - The launch investment budget for Exxua has been reduced from $10 million to under $8 million due to execution efficiencies [29] Q&A Session Summary Question: Feedback from doctors prescribing Exxua - Early feedback indicates that physicians are motivated by the unique mechanism of action and the ease of prescribing through RxConnect [33][34] Question: Plans for sales force expansion - Management indicated that expansion would depend on achieving internal forecasts and cash flow, with no immediate plans for expansion in fiscal 2026 [38][39] Question: Direct-to-consumer campaign details - The campaign will focus on web-based strategies, including search engine optimization and social media, while maintaining compliance with regulations [40][41] Question: Impact of weather on prescription fulfillment - Weather has caused delays in prescriptions being filled, but the company has adequate supply to meet demand [46][53]

Core Insights - Aytu Biopharma has officially launched Exxua, a first-in-class treatment for major depressive disorder, marking a significant milestone in the company's history [1] - The sales force for Exxua is fully deployed and actively generating prescriptions, indicating strong market enthusiasm and potential for growth [2] Company Developments - The launch of Exxua represents a transformational opportunity for Aytu Biopharma as it introduces the first and only 5-HT1a agonist in the market [1] - The company is currently experiencing positive feedback from the field regarding the new product, suggesting a promising reception among healthcare providers [2]

Financial Data and Key Metrics Changes - Net revenue for Q1 2026 was $13.9 million, down from $16.6 million in the prior year, but excluding a one-time rebate benefit from last year, net revenue increased by 5% [17][21] - ADHD portfolio net revenue was $13.2 million compared to $15.3 million in the prior year, but on an equivalent basis, it increased by about 10% [17][21] - Gross margin decreased to 66% from 72% year-over-year, but improved to 65% when excluding the rebate [18][21] - Operating expenses were $10.2 million, down from $11.2 million in the prior year, reflecting cost reduction efforts [19][21] Business Line Data and Key Metrics Changes - The ADHD portfolio showed resilience with a 10% increase in net revenue on an equivalent basis, despite a decrease in total prescriptions [17][21] - The pediatric portfolio revenue dropped to $0.7 million from $1.3 million due to manufacturing delays and a de-emphasis in marketing [18][21] Market Data and Key Metrics Changes - The company is preparing for the launch of Exxua, which is expected to significantly impact the market for major depressive disorder treatments [5][10] - The ADHD market remains highly genericized, but the company believes its unique distribution model will mitigate the impact of generic competition [12][13] Company Strategy and Development Direction - The company is focused on the successful launch of Exxua, with significant preparations underway including KOL engagement and Salesforce training [5][10] - Aytu is maintaining a Salesforce of approximately 40 people, with territory alignments adjusted for optimal market access [8][9] - The company is also working on lifecycle management approaches to extend exclusivity beyond 2030 [11] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ADHD portfolio's resilience despite the threat of generic competition, citing the unique distribution model [12][13] - The company anticipates a strong launch for Exxua, with positive feedback from prescribers and a focus on targeting younger patients dissatisfied with current treatments [27][44] Other Important Information - The FDA's recent communication regarding fluoride-containing drugs is being monitored, but the impact on Aytu's financials is expected to be minimal [15][16] - Cash and cash equivalents were $32.6 million at the end of the quarter, up from $31 million [22] Q&A Session Summary Question: How significant were the territory realignments and what are the plans for incentive compensation post-Exxua launch? - Approximately one-third of the territories were affected, with a focus on enhancing coverage in key areas. A rich incentive compensation plan is being finalized to reward engagement with new prescribers [30][31] Question: What has been done regarding payer engagement pre-launch? - The company is taking a cautious approach to contracting with commercial payers to maintain best pricing on government contracts, with light engagement ongoing [33][35] Question: How much of the target prescriber market has been reached and what feedback has been received? - Feedback from engaged prescribers has been overwhelmingly positive, with a focus on targeting psychiatrists already familiar with Aytu's products [40][41] Question: What is the flexibility of the supply chain to ramp up production if demand exceeds expectations? - The company has sufficient supply to meet initial forecasts and can scale production as needed, with a low cost of goods sold projected [49][51]