VERU INC. Q2 FY2025 earnings call

• Veru is developing Enobosarm as an oral SARM to make GLP-1 receptor agonists more tissue-selective for fat loss while preserving lean mass. - Phase 2b multicenter study of Enobosarm with semaglutide showed statistically significant preservation of lean mass and greater fat loss with Enobosarm 3mg plus semaglutide. - Upcoming catalysts include unblinded safety data for Phase 2b quality study, top-line efficacy and safety results for Phase 2b extension maintenance study, FDA end-of-Phase 2 meeting for Phase 3 program, and Phase 1 bioavailability data for modified release enobosarm formulation. - Financial highlights: R&D and SG&A expense changes, gains on asset sales, net losses from continuing and discontinued operations, cash runway information.

Veru is a late clinical-stage biopharmaceutical company focused on cardiometabolic and inflammatory diseases. Its drug candidates are Enobosarm and Sabizabulin, with focus on the obesity program. Financially, for Q2 FY2025, research and development costs were $3.9 million (up from $3 million prior quarter), SG&A expenses were $5.2 million (down from $5.9 million prior quarter). Gain on sale of NTIA assets was $974,000. Net loss from continuing operations was $7.9 million or $0.05 per diluted common share. For the six months ended March 31, 2025, R&D costs were $9.6 million (up from $4.6 million prior period), SG&A expenses were $10.4 million (down from $12.6 million prior period). Gain on sale of Entity assets was $1.7 million. Net loss from continuing operations was $9.6 million or $0.07 per diluted common share. Cash balance as of March 31, 2025, was $20 million, with net working capital of $15.8 million.

• Veru has enough cash to last into the fourth calendar quarter, allowing time to get through catalysts. - Expect unblinded safety data for Phase 2b quality study and top-line efficacy/safety data for Phase 2b extension study this quarter. - Anticipate FDA regulatory clarity in Q3 2025 regarding the Phase 3 program. - Expect Phase 1 bioavailability data for novel modified release oral enobosarm formulation in the first half of 2025.

• Clinical trial outcomes may not meet expectations. - Regulatory approvals may be delayed or face challenges. - Cash runway is a concern as current cash may not fund operations beyond 12 months. - Potential tariffs on manufacturing could impact costs, though currently not foreseen as significant.

Q: Could you talk a little bit more about how you're thinking about your cash balance in runway, specifically what options are you exploring to fund the Phase 3? And is there potential to partner out the program?

A: Mitchell Steiner said Veru has enough cash to last into the fourth quarter, with plans to get through catalysts, considering non-dilutive funding like partnerships with large pharmaceutical companies and being in active discussions for such partnerships.

Q: For the Phase 2b extension maintenance study, review what outcomes would be considered a success, in terms of the magnitude of benefit on weight loss and muscle mass for enobosarm versus placebo after stopping the GLP-1. Does it need to be stat sig or just show a positive trend? And is that, if you could just say, if the data is imminent or if it will be later in the quarter?

A: Mitchell Steiner said the extension study is more descriptive, with success being blunting fat regain and maintaining lean mass, with safety data for Phase 2b quality study coming out first this quarter and Phase 2b extension maintenance data shortly after.

Q: Just wanting to tease out a bit more on what you might have seen already on safety. Understanding it's blinded to date, you did say that you haven't seen any significant differences compared to what you're expected or expecting, based on the previous studies. So, just to sort of help us out and set a bar, maybe you could provide some color on what your expectations are for the safety, based on these prior studies and how we should be interpreting this, in terms of just the general safety, but maybe specifically on these liver tests?

A: Mitchell Steiner said SARMs in general have been misrepresented, with enobosarm showing mild ALT increases that are self-limiting and consistent with adaptation and tolerance, similar to GLP-1s, with no significant serious adverse events seen in aggregate.

Q: Just a quick question again on the Phase 3 trial. You mentioned adding tirzepatide and I'm curious what your thoughts are there. There's some anecdotal evidence that tirzepatide skews a little bit more towards fat loss instead of lean mass. I'm curious how you're planning around that in your trial design, potentially.

A: Mitchell Steiner said they'll power the study based on lean mass loss data, with stratification on whether it's tirzepatide or semaglutide to avoid mixing apples with oranges, and lean mass loss with tirzepatide is similar to semaglutide in data seen.