Veru Inc. Q3 FY2026 earnings call

• Pipeline and Clinical Development Updates • Veru is developing two novel assets: inobasarm for combination use with GLP-1 receptor agonists to improve weight loss quality for older patients with obesity, and sabizabulin for atherosclerotic cardiovascular disease. • The completed Phase 2B Quality trial for inobasarm was the first human study to confirm that GLP-1 treatment for older obese patients increases risk of accelerated lean mass loss and physical function decline, and demonstrated inobasarm preserves lean muscle mass and reduces the share of patients experiencing clinically significant physical function decline compared to GLP-1 alone. • The Phase 2B Plateau trial, a double-blind placebo-controlled study evaluating inobasarm 3mg in combination with semaglutide for 200+ older obese patients to test if inobasarm can break GLP-1 weight loss plateaus while preserving muscle, has been fully enrolled with 239 patients. Interim analysis data is expected in Q1 calendar 2027, with final data expected in Q4 2027. • Clinical data from the Plateau trial with injectable semaglutide will support future development of an oral inobasarm/oral semaglutide fixed-dose combination for Phase III trials.

• Strategic Collaboration and Intellectual Property • In June 2026, Veru entered into a supply agreement with Novo Nordisk, where Novo Nordisk supplies Wegovy (semaglutide) for the Phase 2B Plateau trial at no cost. Veru grants Novo Nordisk a right of first negotiation if Veru intends to develop, commercialize, or license inobasarm in combination with any Novo Nordisk GLP-1 product, while Veru retains full global development and commercialization rights for inobasarm. • Veru received a notice of allowance from the USPTO for a key method-of-use patent covering inobasarm use in combination with GLP-1s for quality weight loss. The allowed claims cover multiple treatment regimens (concurrent use, adding inobasarm after GLP-1 monotherapy, inobasarm use after GLP-1 discontinuation) and multiple clinical benefits, including lean mass preservation, enhanced fat loss, physical function improvement, bone health preservation, and prevention of weight rebound after GLP-1 discontinuation. When issued, the patent will expire no earlier than October 2044, prior to any potential patent term adjustments. • Additional pending patent applications worldwide cover inobasarm combination use with all weight loss drugs (not just GLP-1s and semaglutide), as well as a novel oral modified release formulation of inobasarm that would be protected until at least May 2046 if issued.

• Market Opportunity Highlights • Inobasarm is targeted at the large, underserved market of older patients (65+ years) with sarcopenic obesity. 41.5% of adults 65+ in the U.S. have obesity, representing approximately 20 million potential patients covered by Medicare Part D. • Starting July 1, 2026, Medicare now covers GLP-1 weight loss medications, creating a clearer path to reimbursement for combination therapy with inobasarm if approved.

Veru Inc. is a late-stage clinical biopharmaceutical company with two product segments: Inobasarm, an obesity-focused asset, and sabizabulin, a cardiovascular asset. The call does not report any revenue from commercial product sales as both assets remain in clinical development. All reported financials are operating and non-operating costs and gains: for Q3 fiscal 2026 ended June 30, 2026, R&D costs were $4.4 million, G&A costs were $3.4 million, a $546,000 gain was recognized on fair value adjustment of Onkinetics equity securities, and net loss was $7 million (30 cents per diluted share). For the nine months ended June 30, 2026, R&D costs were $8.8 million, G&A costs were $11.5 million, a $4.4 million gain was recognized on fair value of Onkinetics equity securities, a $351,000 additional gain was recorded on the prior sale of the FC2 female condom business, and net loss was $15.1 million (68 cents per diluted share). As of June 30, 2026, total cash, cash equivalents, and restricted cash was $23.9 million with net working capital of $21.1 million.

• Management confirms that as of the financial statement issuance date, current cash reserves are sufficient to fund operations through the interim analysis readout of the Phase 2B Plateau trial in Q1 calendar 2027, which is the next major near-term milestone for the company.
• The patent portfolio strategy continues to focus on expanding coverage to all weight loss drug classes beyond semaglutide and GLP-1s, with additional patent approvals expected as applications progress through global prosecution.

• The company is not currently profitable and generates negative cash flow from operations, so future additional capital raising will be required to fund late-stage clinical development and any potential commercialization after the milestone that cash is currently budgeted to support.
• All forward-looking statements around clinical trial results, patent approvals, and commercial opportunity are subject to known and unknown risks that could cause actual outcomes to differ materially from projections, including risks of negative or inconclusive clinical trial results, regulatory delays, failure to secure additional patent protection, and lack of market acceptance for the combination therapy. All material risks are outlined in the company's 10-Q, 10-K, and other SEC filings.

Q: How does the newly allowed inobasarm patent for combination use with semaglutide position the company for future expansion to other GLP-1s and weight loss combination products, as the GLP-1 market grows and diversifies?

A: The newly allowed patent is the first major breakthrough for the company's patent strategy, confirming the USPTO views the combination of inobasarm with GLP-1 weight loss drugs as novel and non-obvious. The base patent application was written to broadly cover all weight loss drugs, not just semaglutide, and multiple additional patent applications covering the entire GLP-1 class and other weight loss drug categories are currently being prosecuted globally. The initial allowance for semaglutide, which matches the company's current clinical development focus, de-risks the broader patent strategy and establishes a strong intellectual property position that will extend to 2044 for this core indication.

Q: What key major developments from this quarter should investors prioritize?

A: Multiple high-impact milestones have been achieved that move the company forward significantly. First, the field of obesity drug development is increasingly aligning with Veru's strategy, recognizing that older patients are at uniquely high risk of adverse outcomes from non-selective lean mass loss with GLP-1 monotherapy, which matches Veru's focus on this specific patient population and helps define a clear commercial indication that aligns with FDA expectations for targeted labeling. Second, full enrollment of the Phase 2B Plateau trial means data readouts (interim in Q1 2027, final in Q4 2027) are upcoming, providing the market with near-term catalysts. Third, the supply agreement with Novo Nordisk creates a direct strategic relationship with a leading GLP-1 manufacturer, with a structured path for future collaboration. Fourth, the new allowed patent establishes intellectual property protection through 2044, confirming the novelty of the company's approach. Finally, Medicare now covers GLP-1 weight loss drugs for the 20 million+ older Medicare patients that make up Veru's target market, opening a clear path to future reimbursement.