BioCryst (BCRX) Q3 2026 Earnings Call Transcript

DATE

Wednesday, Nov. 4, 2026

CALL PARTICIPANTS

• President and Chief Executive Officer - Charles K. Gayer
• Chief Financial Officer - Babar Ghias
• Chief R&D Officer - Dr. Sandeep Menon

Need a quote from a Motley Fool analyst? Email pr@fool.com

TAKEAWAYS

• Total Revenue -- $180.3 million, representing 13% growth year over year driven by strong ORLADEYO sales and licensing revenue.
• ORLADEYO Net Revenue -- $174.8 million, reflecting 20% growth year over year on a comparable basis excluding European sales.
• Full Year 2026 Total Revenue Guidance -- $715 million to $730 million, an increase from the previous range of $690 million to $715 million due to higher licensing revenue and international partner orders.
• Full Year 2026 ORLADEYO Revenue Guidance -- $625 million to $645 million, maintained as the company transitions to a new specialty pharmacy model.
• Full Year 2026 Non-GAAP Operating Expense Guidance -- $415 million to $425 million, an improvement from previous projections due to cost-saving measures from site closures.
• CareMed Inventory Contribution -- upper teens of millions of dollars, representing a one-time benefit from the initial inventory build during the transition to a sole-source pharmacy partner.
• Non-GAAP Operating Profit -- $86.5 million, an increase of 70% year over year reflecting significant operating leverage.
• Non-GAAP Net Income -- $71.1 million, more than doubling from the prior year period as the company achieved durable profitability.
• Cash and Equivalents -- $376.4 million, providing a strong liquidity position for strategic investments and pipeline development.
• Birmingham Site Closure Savings -- $30 million to $35 million, representing expected annualized savings once restructuring is fully realized.
• Restructuring Cash Costs -- $10 million, focused on the closure of the Birmingham research facility and organizational streamlining.
• Paid Rx Rate -- 82% to 83%, with a long-term goal of reaching 85% steady state through improved pharmacy operational excellence.
• ORLADEYO Patient Retention -- 60% after 12 months, with these patients typically achieving market-competitive efficacy and low attack rates.
• Navenibart Data Timing -- top-line pivotal results expected in the third quarter of 2027 following the completion of enrollment in June.
• BCX17725 Clinical Data -- initial results expected by the end of 2026 for the treatment of Netherton syndrome patients.
• Netherton Syndrome Improvement Target -- 20% to 25% in the Ichthyosis Area Severity Score, which management indicated would be a clinically meaningful endpoint.
• United States Netherton Population -- at least 3,000 patients, representing a significant underserved market with no currently approved therapies.
• CareMed Inventory Range -- 7 to 21 days of product, which management expects to remain at the lower end of the range going forward.
• GAAP Operating Profit -- $53.3 million, an increase from $29.6 million in the prior year period.
• Diluted Net Income Per Share -- $0.14, representing a substantial improvement from $0.06 per share in the third quarter of 2025.
• Non-GAAP Research and Development Expenses -- $37.1 million, a slight decrease year over year as higher navenibart costs were offset by savings from discontinued programs.
• Non-GAAP Sales and Marketing Expenses -- $36.0 million, up 4% year over year primarily due to transition fees associated with specialty pharmacy changes.

SUMMARY

BioCryst Pharmaceuticals, Inc. (NASDAQ:BCRX) reported a third quarter focused on commercial expansion and structural cost improvements. Management increased its full year total revenue guidance while simultaneously lowering operating expense projections, reflecting the dual impact of growing ORLADEYO demand and significant cost savings from the closure of the Birmingham research facility. The company successfully transitioned to CareMed as its sole-source specialty pharmacy partner in the United States, a move intended to scale operations for its growing portfolio of hereditary angioedema (HAE) offerings. This transition contributed a one-time inventory build benefit to the quarter's revenue, but management emphasized that future growth will more closely track underlying patient demand. The pipeline remains a primary focus, with pivotal data for navenibart and early clinical data for BCX17725 scheduled for release within the next year.

• The transition to CareMed as the exclusive specialty pharmacy partner is expected to optimize patient services and fulfillment, with CFO Ghias noting that "performance of a pharmacy can actually create a meaningful impact on the progress of the product."
• Management reported strong early demand for the pediatric pellet formulation of ORLADEYO, with CEO Gayer stating that the "mix of kids switching from other prophy and acute only as well as those who were treatment naive, has been balanced."
• The recent FDA approval of 150 mg pellets for patients aged 12 and older provides a new option for those who prefer pellets over capsules or have difficulty swallowing.
• The company is prioritizing external innovation for its future pipeline, recently forming a Scientific Advisory Board of industry experts to evaluate early-stage clinical assets.
• The pivotal ALPHA-ORBIT trial for navenibart will evaluate every three-month and every six-month dosing, which management believes could be "transformative" for patients currently using injectable therapies.
• BioCryst discontinued the early-stage STAR-0310 program to concentrate resources on rare disease therapeutics and core strengths.

INDUSTRY GLOSSARY

• HAE: Hereditary angioedema, a rare genetic disorder characterized by severe, recurrent swelling in various parts of the body.
• ORLADEYO: The brand name for berotralstat, an oral, once-daily medication approved for the prevention of HAE attacks.
• Navenibart: An investigational long-acting plasma kallikrein inhibitor currently in Phase 3 trials for the prevention of HAE attacks.
• IASI: The Ichthyosis Area Severity Index, a clinical measurement tool used to evaluate the extent and severity of skin conditions like Netherton syndrome.
• BCX17725: An investigational inhibitor targeting KLK5 (Kallikrein-related peptidase 5) for the treatment of Netherton syndrome.
• CareMed: A specialty pharmacy partner that provides distribution and patient support services for high-cost, complex medications.
• BLA: Biologics License Application, a request for permission to introduce a biologic product into interstate commerce.

Full Conference Call Transcript

Operator: Good day, and thank you for standing by. Welcome to the BioCryst Third Quarter 26 Earnings Call. At this time, all participants are in a listen-only mode. After the speakers' presentation, there will be a question and answer session. To ask a question during the session, you will need to press *11 on your-- you will then hear an automated message advising your hand is raised. To withdraw your question, please press *11 again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your first speaker today, Nick Wilder with BioCryst. Nick? Go ahead.

Nick Wilder: Good morning, and welcome to BioCryst's Third Quarter 26 Corporate Update and Financial Results Conference Call. Participating with me today are President and CEO, Charles K. Gayer chief financial officer Babar Ghias and chief R&D officer, Dr. Sandeep Menon. A press release and slide presentation about today's news are available on our investor relations website. Today's call contains forward looking statements, including statements regarding future results, unaudited and forward looking financial information, as well as the company's future performance and or achievements. These statements are subject to known and unknown risks and uncertainties which may cause our actual results, performance, or achievements to be materially different from any future results or performance expressed or implied in this presentation.

For additional information, including a detailed discussion of these risks, please refer to slide 2 of the presentation. In addition, today's conference call includes non GAAP financial measures. For a reconciliation of these non GAAP financial measures against the most directly comparable GAAP financial measure, please refer to the earnings press release available on our investor relations website. I would now like to turn the call over to Charles.

Charles K. Gayer: Thanks, Nick. The third quarter was significant for BioCryst as we continue to deliver strong execution during a time of strategic evolution. On the HAE front, new patient prescriptions for ORLADEYO continued at the same high level that we have seen all year. We again added new prescribers at a rate above the average of the past several, and the total base of treated patients grew at a healthy rate in the quarter. We were thrilled to launch ORLADEYO pellets to kids in August and early signs of performance continue to be promising.

Children of all ages across the 2 to 11 range have started on ORLADEYO pellets, and the mix of kids switching from other prophy and acute only as well as those who were treatment naive, has been balanced. This suggests the pediatric market may grow beyond this 500 patients that we have previously described. We are also looking forward to launching the recently approved 150 milligram ORLADEYO pellets at the upcoming American College of Allergy, Asthma, and Immunology meeting this month. This new formulation for ages 12 and up provides an option for kids who started on pellets, for adolescents and adults who have difficulty swallowing a capsule, or for anyone who simply prefers the pellet formulation.

We are looking forward to generating real world evidence to track the progress and patterns of use for all patients treated with ORLADEYO pellets. During the third quarter, we also implemented the transition to CareMed as our sole source pharmacy partner for shipments to patients. We switched to CareMed because the volume of patients on ORLADEYO has grown to the point where operational excellence at the pharmacy level can have a significant impact on the growth in treated patients and the shipment of paid product. We are working closely with CareMed to integrate best practices within our Empower patient services program and are encouraged by the early signs we are seeing in the partnership.

We believe CareMed can scale with us as our portfolio of HAE prophy offerings continues to grow. Turning to our pipeline. As we have previously announced, the pivotal trial for navenibart fully enrolled in June and we remain on track to announce top-line data through 12 months of therapy in the third quarter of next year. Our team is working diligently on the BLA file as well as launch planning for when we add this potentially transformative product to our HAE portfolio. Continuing on the theme of strong execution. We have enrolled Part 4 of our trial of BCX1.77 thousand for Netherton syndrome patients, and are on track to have early clinical data by the end of this year.

There are no treatments approved for this devastating skin condition. That we believe includes at least 3 thousand patients in the United States alone. Once the data reads out, we will review the data in totality, which includes key efficacy endpoints like IASI, the ichthyosis area severity score. As well as safety and tolerability to inform potential next steps in the program. Finally, we are excited about our strategic shift toward building our pipeline through external innovation. We recently announced a scientific advisory board of leading biotech industry experts who will partner with us to deliver on our strategy. These esteemed advisers with a successful track record, did not join us just for the honor of being on the board.

They joined us because they believe that Viacryst's profitability, discipline, and strong execution position the company for success in our rare disease strategy. With that, I will turn it over to Babar to describe our increasingly strong financial position.

Babar Ghias: Thanks, Charles. We are pleased to share the results of a very strong third quarter. Which included not only the important accomplishments just described, but also continued financial excellence. The intentional proactive steps we have taken throughout the year to position BioCryst for durable growth and increasing profitability continue to be reflected in our financial performance.

Sandeep Menon: In my remarks today, I will refer to certain non GAAP financial measures, which adjust for revenues and expenses associated with our former European ORLADEYO business stock based-comp, Birmingham site closure and organizational restructuring costs, and the expenses associated with the Astria acquisition. Additional information regarding these adjustments is included in today's press release. We believe these non-GAAP measures provide investors with a useful view of the underlying performance of our business. Turning first to revenue.

Babar Ghias: Over the year net revenue was $174.8 million for the quarter, with >95% coming from the U.S. business. On a comparable basis, excluding European revenue, ORLADEYO revenue increased 20% year-over-year. ORLADEYO revenues benefited this quarter from the CareMed transition. 1 of the benefits of switching to a larger specialty pharmacy is that they maintain a level of inventory at multiple sites, and broader set of working operational hours that facilitate timely fulfillment to the efficiently respond to patient demand. The inventory they hold typically ranges from 1 to 3 weeks of product. As part of the transition to this model, CareMed built an inventory level towards the lower end of this range during the third quarter.

Resulting in a revenue contribution in the upper-teens of millions of dollars in the quarter. Since we expect their inventory level to remain in this lower end, revenue should more closely reflect underlying patient demand going forward. While the transition of this nature naturally creates some temporary operational as systems and processes are implemented, we are very pleased with the progress to date. Although it is still early, we are already seeing an improvement in days to first shipment for new patients. An important measure of the patient experience. Despite the transition, even when removing the impact of the inventory build, ORLADEYO revenue, excluding Europe, grew year over year.

This is evidence of the continued favorable patient dynamics across the approved population. Throughout this process, our priority has remained the same. Maintaining a high quality patient experience and uninterrupted access to ORLADEYO. Before turning to operating expenses, let me briefly provide some context around the GAAP to non GAAP adjustments this quarter. These adjustments primarily relate to the closure of our Birmingham facility associated organizational restructuring activities that remain on track to be substantially completed by year-end. Of the approximately $19 million in restructuring related expenses in the quarter, only $10 million are real cash costs. Noncash charges primarily reflected accounting adjustments to assets that will no longer have economic use following the closure.

The most important takeaway today is the structural benefit to our cost base. The actions we have taken are expected to generate approximately $30 million to $35 million of annualized savings once fully realized with the potential for additional savings as certain programs are wound up. As we look toward 2027, the business as it exists today is positioned for continued revenue growth alongside a lower operating cost base than in 2026. We will provide formal 2027 guidance at the appropriate time but the combination should support continued expansion in profitability. Turning now over to operating expenses. Non-GAAP operating expenses were slightly lower year over year consistent with the financial discipline we have been emphasizing.

We are actively investing in the Phase 3 development program for navenibart, which is naturally an important driver of R&D spend. At the same time, we are taking a disciplined data driven approach to capital allocation across the rest of the pipeline. BCX17.7 thousand is a good example. Our approach has been to generate early clinical data in patients first, and let that data prospectively inform the appropriate level of future investment. We remain on track to share those data before year end. Sales and marketing expenses were modestly higher year-over-year, driven primarily by the transition related fees associated with the specialty pharmacies And G&A expense has remained essentially flat.

This operating leverage from the trends is increasingly visible in our results. Non-GAAP operating profit for the quarter was $86 million, an increase of 70% year over year. While non GAAP net income of $71 million, more than doubled from the prior year period. As profitability continues to grow, we also expect benefit from our substantial net operating loss carryforwards. Which should help limit cash taxes over the medium term subject to applicable tax rules and limitations. That creates the potential for strong growth not only in earnings, but also in cash generation. Our liquidity position remains strong with cash and equivalents of $376 million.

As we have discussed, we have made a deliberate pivot toward external innovation, but we are going to remain disciplined in how we build the pipeline. For us, the priority is not adding programs simply to increase the size of the pipeline. It is identifying opportunities where we believe BioCryst can create meaningful value for patients and shareholders. At the same time, we will always continue to evaluate opportunities to strengthen the balance sheet and return capital. While maintaining the financial flexibility to invest in compelling innovation. Turning finally to our 2026 financial guidance. When we established our ORLADEYO revenue guidance, we did not assume a benefit from the initial specialty pharmacy inventory build.

Given that we still remain relatively early in the CareMed transition implementation, we are not changing ORLADEYO revenue guidance at this time. We are encouraged by the progress we are seeing, but we also recognize that we are transitioning 6 years of launch experience systems, and operating knowledge from 1 partner to another on an accelerated timeline. Importantly, we view this as a finite transition. And not a long term operating dynamic. Underlying patient demands and trends remain strong, and we are excited about the opportunity to expand the pediatric launch while also offering the newly approved oral pellet formulation for patients with HAE 12 years and older. Providing a continuum of oral treatment options.

On the other hand, we are increasing our total revenue guidance to $715 million to $730 million reflecting higher realized licensing revenue and international RAPIVAB orders from our partner. To emphasize, RAPIVAB is not a strategic core asset for us, and is mostly a pass through business with low margins. On expenses, we are again tightening our full year operating expense guidance now to $415 million to $425 million for 2026. When we realize the full year benefit of the actions we have taken in 2026, we expect operating expenses in 2027 to decline further while the underlying business continues to grow. To close, this was a very strong third quarter and strong first 9 months of 2020.

We have 1 quarter remaining, and our focus is on finishing the year well and entering 2027 from a position of considerable strength. With growing revenue, and increasingly efficient cost structure, expanding profitability, strong liquidity, and important pipeline catalysts ahead. We believe we have the opportunity to make 2027 a transformational year for BioCryst. The entire organization is focused on executing against the opportunity. And I am very grateful to our colleagues across BioCryst for everything they have accomplished this year. With that, operator, we are now ready to take questions.

Operator: Thank you. At this time, we will conduct the question and answer session. As a reminder, to ask a question, you will need to press *11 on your telephone and wait for your name to be announced. To withdraw your question, please press *11 again. Our first question comes from the line of Gavin Clark-Gartner with Evercore ISI. Go ahead.

Gavin Clark-Gartner: Hey, guys. Great to see the progress, and thanks for taking the question. Yeah, sure. First, just to clarify on the inventory. So there was upper teens contribution from the CareMed inventory build. How should we expect that to trend next quarter? Will there be a reversal of a similar amount? Is there some level of inventory build still to happen here? Like, what should we think about next quarter?

Babar Ghias: Yes. Thanks for the question, Gavin. So I think your intuition is correct. it is a 1-time inventory build that they have to for dispensing. And our expectation is that, as I mentioned in the call, that typically, they hold 7 to 31 days of. 7 to 21 days of inventory. And in this quarter, we were on the lower side of that range. And we expect that to remain in the lower side. So it is you are not going to expect a onetime benefit or, I guess, a recurring benefit of inventory every quarter from this point onwards. There may be, in the near term, in another quarter, there may be small fluctuations.

But as it gets smoothed out, it should reflect patient demand. To summarize, it was really a onetime benefit of this order of magnitude, and that should be the expectation.

Gavin Clark-Gartner: Okay. Great. that is helpful. And just quickly quick follow-up. What was the pediatric prescriptions that you saw this quarter?

Charles K. Gayer: We are not going to get into the specific numbers. Gavin, but it continued to be strong. You know, we had announced at the end, I think it was at the end of July, we had 47 patients. That was well ahead of our expectations for the year. We continue ahead of our expectations. The pediatric revenue we generate is still up going to be a very small part of this year's revenue, but it is a good sign for the future. Like I mentioned, we are we are looking forward to starting to collect real world evidence in this population. So I think we will have more to report out in the future as a little more time passes.

Gavin Clark-Gartner: Perfect. Thanks, guys.

Operator: 1 moment for our next question. Our next question comes from the line of Laura Chico at Wedbush. Your line is live.

Laura Chico: Good morning. Thanks very much for taking the question. I guess I wanted to ask 1 more strategic. Could you expand on your commentary around 2033 and beyond outlook for the HAE franchise If I am looking at the slides correctly, it looks like you are describing it as a range from about $1.4 billion to $2 billion in 2033 I think before you talked about this as a $1.8+ billion opportunity. So I guess help us understand some of the dynamics there that go into the lower and upper bounds. What needs to go right And, I guess, has anything changed to shift your outlook? Thank you.

Charles K. Gayer: Thanks, Laura. Yeah, sure. The range that we provided is actually based on sell side analyst views of the portfolio, and we put it out there because directionally, we agree with the 2 products with, the most established oral at that point, the market leading oral prophy. And then we think will be a really transformative product with every 3- and 6-month dose with navenibart, it really allows us to hit both big segments of the market, those who prefer oral prophy and those who prefer injectable prophy.

And so the things that need to go right for that to happen, obviously, is continued growth of ORLADEYO, which we expect in all of our forward looking research metrics tell us that, that will continue. And then a strong launch that we are preparing for navenibart. And what we see in our research with doctors in patients is that 3- and 6-month dosing with high efficacy and with a convenient administration is something that gets their attention. And will encourage patients to switch. So the real key is going to be how many of the patients who are on other injectable prophies want to take advantage of this longer term dosing and switch.

That will be the key driver of kind of the pace of our revenue growth and kind of the ultimate peak of where we get with the navenibart market. Thanks, Charles.

Laura Chico: Thanks.

Operator: 1 moment for our next question. Our next question comes from the line of Steven Seedhouse at Cantor. Go ahead.

Steven Seedhouse: Great. Thanks for taking the question. Sort of related to the long term revenue projections, but specifically as it pertains to ORLADEYO and just the stickiness of that. Have you guys done any updated market research post the deucravacitinib prophylaxis Phase 3 result? And do you have a sense that, that was above, below, or sort of in line with expectations of what you have been modeling really for the past several years? Thanks.

Charles K. Gayer: Thanks, Steven. We have not done specific research since the data came out. However, what we did do is our annual large exercise that we do every. The middle of every year where we talk to 175 treaters, 100 patients, and 50 payers. And run it through a big conjoint exercise and market simulation model. What we put in there for deucravacitinib, recall that we always put all of our current and future competition in with their best case profile. And so the profile that we put in for deucravacitinib was actually slightly better than what they actually proved out in the Phase 3. So comparable but slightly better.

And it showed that, yes, that product will gain share as you would expect, but what it is not going to do is take away the base of ORLADEYO patients. And so we continue to see ORLADEYO growing even in the face of future competition in a couple of years from deucravacitinib.

Steven Seedhouse: Perfect. Thank you.

Operator: 1 moment for our next question. Our next question comes from the line of Stacy Ku at TD Cowen. Go ahead.

Stacy Ku: Hey, thanks so much for taking our questions. We have a couple of clarifications. So first, maybe can you talk about your. Given your inventory commentary, really appreciate all the all the detail thoughts there. Your level of confidence in the high end of ORLADEYO guidance that you provided for the year, This is just a follow-up on inventory.

And then second, on the pediatric launch, is it would you characterize it more as steady additions, or are you seeing a bit of a bolus type of dynamic for the pediatric prescriptions As we look to next year and consensus, I know you will not comment, but does that include what you are seeing for the pediatric launch, or would you look at that as upside? And then third clarification, when we speak to clinicians, they tend to have their patients tracked very detailed data on their attacks for payer reimbursement and access.

So as you are looking at the oral competitive landscape, on the next couple of years, do you have a good sense of the percentage of patients that are well controlled in ORLADEYO? So having really competitive attack rate reduction reductions. So try to understand the stickiness of the drug. Thanks so much.

Charles K. Gayer: Great. Thanks, Stacy. Maybe I will go through the question with all those pieces, and then we will come back and Babar can talk about the inventory. So on the pediatrics So number 1, it is it is what we are seeing is kind of steady, strong additions. So there was, of course, a bolus at first, particularly because of the supply delay that we had. So there was a bolus to start. Those patients have been transitioned to therapy.

And then we are seeing continued strong demand that is ahead of what our original expectations are. it is still only been a few months, so we will have to see how long this continues, but the early signs are very promising. As we kind of look to the future of ORLADEYO and when we give guidance for 2027, pediatrics will be absolutely a part of all of that. And then when we have additional data that is, as I have mentioned, real world evidence, when we generate other evidence that we think is interesting and helpful, we may comment on other pieces of how pediatrics breaks out of the whole.

And then as far as patients, the patients who are well controlled on ORLADEYO, you have heard us talk before about when patients start, 60% of them roughly get to, 12 months of therapy. And then those patients are largely the very well controlled. And so those are the ones who are getting down to median attack rate. We have put out real world evidence on this, where they are getting down to a median attack rate of about 1/3 of an attack per month. And patients generally are reporting significant reductions in attack rates regardless of where they are coming from, whether they switch from other prophy or were not previously on prophy.

And so we feel like we are we are holding on to the patients who are doing well. They are getting market competitive efficacy. So then, Babar, you want to talk about the-- Yes.

Babar Ghias: So, thanks, Stacy, for the question. Allow me to explain a little bit more perspective on the pharmacy. So, look, at the end of the day, the progress of any product should be on patient demand and not inventory dynamics. And as Charles mentioned in his remarks that performance of a pharmacy can actually create a meaningful impact on the progress of the product. And when we made that switch, we were getting to a point of scaling the product that we needed to move with a larger partner. Who can support the vision for ORLADEYO and potentially navenibart when it gets approved.

So when we think about, you know, basically keeping the guidance as we at the start of the year, we had a different pharmacy partner. We had a different operating model. It was not necessarily incorporating the dynamics of the inventory As I said, what we do not want to do is artificially change the guidance because fundamentally, it should be about patient demand. So we are still in early days of that, so we did not feel the need that at this point in time, we need to change the guidance for ORLADEYO just because we have a onetime inventory dynamic.

And as I said, that once we get past this quarter, as you can appreciate, it is only been 6 weeks that we have actually been, like, fully with the CareMed because the implementation started somewhere in the August time frame. So call it 6 to 8 weeks. We do not even have a full quarter under our belt. So as we get past through that, it should really reflect the patient demand. So that is why we were being a little bit careful and being conservative in terms of changing guidance at this point in time just because of the inventory. Hope that is helpful.

Stacy Ku: Thank you.

Operator: 1 moment for our next question. Our next question comes from the line of Tazeen Ahmed with Bank of America. Go ahead.

Analyst: Great. Hi. This is Jeremiah on for Tazeen, Thanks for taking our question. I wanted to ask a question on the Netherton readout that is expected around year-end. I am just wondering what is the benchmark or what level of data you guys are looking for in order to move that program forward? And I guess depending on if the study hits, how quickly could you move to pivotal stages? Thanks.

Sandeep Menon: Sandeep, you want to take that? [Sandeep Menon] Yeah, sure. I will take that. No. Thank you for the question.

Charles K. Gayer: You know, as you know, Netherton syndrome, is a devastating skin disease, and that has got multiple other layers of disease manifestation, including immunity, and inflammation. We are getting ready for our data readout in December. What we will be present is. Presenting is the primary endpoint and key endpoints along with, obviously, the safety and tolerability of that. And what good looks like at this point, you know, these patients do not have any treatment options. And given the severity of the disease, you know, any improvement, which is clinically meaningful is still better than what patients do not have at this point.

So we have, talked to the patients and the relevant KOLs, and also in this discussions very soon with the FDA to come up with a benchmark, basically. But from our perspective, you know, as long as we are able to get 20 to 25 percent in the primary IASI score, I think it is. It should be a pretty good clinically meaningful endpoint based on all the research that we have done internally talking to the KOLs and, obviously, the regulatory discussions are pending As well. So I think we will put it out there for now, and on the. Once the data reads out, you know, we will share more.

Obviously, within that, we will be looking for kind of consistency in effect as well. And so look at this in a number of different ways.

Sandeep Menon: Do you wanna just talk about what. what is. What do we think next will be? We go straight to a. yeah, sure.

Charles K. Gayer: The next, basically, you know, we will be reflecting on the totality of the data. And, you know, at this point, we want to do what is best for the program. And for the patient. So we are not going to rush into anything, you know, that is a pivotal right away. Depending on, you know, what the data is, we will talk to the regulators and, you know, digest the data. And because this is going to be the first in class, first therapy ever coming for Netherton, we want to be very clear in terms of, you know, where we want to take this.

But we will be swift in decision making, and we will move fast you know, to the. At the same time, we will be very scientific scientifically rigorous and thoughtful in how we take the clinical development forward.

Analyst: Very helpful. Thanks, guys.

Operator: 1 moment for our next question. Our next question comes from the line of Maurice Raycroft with Jefferies. Your line is live.

Maurice Raycroft: Hi, good morning. Thanks for taking my questions. Shift gears and maybe just ask 1 on BD. I guess with the new Scientific Advisory Board, can you talk more about their mandate and what your latest thinking is related to BD and the type of assets you are looking to in license?

Sandeep Menon: Yeah, sure. So from our. Thank you for the question, Maurice. So our scientific advisory board has. You can you know, see, it comes with a high pedigree and a very, very successful, you know, track record including with doctor Tony Manning who is chairing the SAB. So it is a working scientific advisory board like Charles mentioned. It is not that people are coming in, to get some luxurious seat. On the board here. They are working with us, you know, as we are, you know, you know, at least a few times a week.

We are rolling up our sleeves, looking at, multiple assets you know, as we have shared before, it is going to be, you know, early clinical assets, you know, Phase 1, Phase 2. Mostly, you know, we will go with a very, very clear biology. We are not going to take chances on things that are, you know, farfetched in terms of an inflection point. And we will ensure that this is sticking to our core strengths because we have a commercial, fabric that we are going to take advantage of.

So that is what we are going to play, and you will see in the next few months, you know, as we have more information, we will be ready to share. But, you know, the punch line here is the SAB is very, very seasoned. They have been there, done that, and we are working together as a team to get to a place where we have a pipeline that is going to be rich and valuable to our stakeholders.

Charles K. Gayer: And, Maurice, just to add to that too, you would course, built a very strong internal team for both scientific evaluation and business development. So the internal team is generating the ideas. And then when we get excited about something, the SAB helps us really wrestle it to the ground. Is this something that we wanna do? So we think it is a great partnership. Early days, it is it is working very well, and we think that this is gonna be very supportive to our strategy.

Maurice Raycroft: Got it. that is helpful. And maybe just a quick follow-up on Netherton. As you guys are thinking about next steps with the program, in the press release, it mentions that expenses were, lower related to the program in third quarter. I guess any specific reasons there? Is it just because the study is enrolled and it is kind of at a status quo, or should we think about that?

Babar Ghias: Yeah, sure. And I think I will point it back to the financial discipline that we have been instituting across the organization, Maurice, and basically taking an evidence based approach. I will give you an example. Like, historically, we may have been a little bit you know, aggressive in our sense that, like, we need to do CMC campaign before we have actually seen results. I think I was basically emphasizing earlier was we are taking a very evidence based and rigorous scientific approach that do we first have a product? Do we have the available data that allows us to unlock the next step of development?

So I think across the organization, we have been instituting that discipline and Netherton and I said, that was a perfect example we did not feel that we need to spend dollars at risk on things before we actually can unlock the data. So that was basically the primary reason why you see a declining expense. And I think that is going to be a theme. Right? That is how we are going to go about and develop on this innovation aspect that we are talking about BD, but also being very committed to delivering strong profitability going forward.

Sandeep Menon: And, Maurice, just to add what Babar nicely summarized, we will ensure that we are still very swift. it is not that we are going to just make it so sequential that we will delay the program, and that is not what it is. Basically, we will get some early data, and we will take the right bets You know, that is going to give us scientific and development success.

Maurice Raycroft: Got it. Okay. Thanks for taking my questions. Yep.

Operator: 1 moment for your next question. The next question comes from the line of Jessica Fye with JPMorgan. Go ahead.

Analyst: Hi. This is Sylvia on for Jess Fye, Thanks for taking our question. To confirm, with the prior model pre CareMed any inventory sitting elsewhere that needs to be worked down that maybe leads to the hesitation to update the ORLADEYO guide? And as a follow-up, and appreciate the conservatism so soon after the specialty pharmacy shift But if the high teens inventory benefit was not contemplated in the fundamental ORLADEYO guidance you laid out and are maintaining, would it be wrong for investors to expect full year ORLADEYO revenue landing in the $650 million to $655 million range, which is just the midpoint of the fundamental guidance plus $15 million to $20 million Thanks.

Charles K. Gayer: [Charles K. Gayer] Sylvia, first of all, from inventory from the prior pharmacy, the billing model was different there. It was there, it was a flash sale for every pack that went out. So there basically was no inventory. And then with CareMed, it is a little bit more traditional pharmacy model where they buy some inventory, as Babar described, at a relatively low level, about a week's worth of inventory. And from the guidance perspective, with everything we see at this point and with the changes that as we are saying, we still have not worked through completely, we see the range of $625 million to $645 million is still the right guidance for the year.

Operator: 1 moment for our next question. Our next question comes from the line of Serge Belanger. Your line is live.

Analyst: Hi. Good morning, everyone. This is John on for Serge today. Thanks for taking our questions. Just a couple on ORLADEYO. First, curious if you could provide an update on the paid Rx rate exiting the third quarter. And if your outlook has changed on where this could reach considering the efficiencies yielded from the CareMed partnership And then second, on the pediatric side of things, you highlighted the launch is progressing ahead of expectations. Just curious how you view the overall opportunity now versus the original 500 patient pool? Thanks.

Charles K. Gayer: Thanks, John. As far as the paid rate, just recall what typically happens in the second half of the year is our pay rate typically peaks in the second quarter after going through all the reauthorizations in the first part of the year. And then in the second half of the year, it starts to gradually tick down mainly because the rate is driven more by new patients coming on and new patients do not get to the 80+% paid rate we have in the overall population as quickly. So we are seeing that same dynamic right in line with our expectations. I think we ended the quarter somewhere around 82% to 83% paid.

To your question around CareMed, we do think, you know, their. With their capabilities working with our team, it gives us the opportunity to meet and potentially exceed our long term goal of getting to an 85% pay rate as kind of a steady state. So we think we are on track for that. I will note that with pediatrics, too, we are seeing excellent early paid rates. Pediatrics, as you would expect, is basically a commercial plus Medicaid business, so a little bit different dynamic. Than our overall population. But the early signs are we are we are getting these kids at a high rate to pay, and I expect that to continue.

And then as far as the overall opportunity for peds, yeah, we are cautiously optimistic that it could end up being bigger than we originally expected. It certainly is turning out to be that this year. I think we need a couple quarters of in addition, at least, to see what the steady state in terms of demand. there is still physicians out there who are still learning about this indication and have not acted yet. And so I think there is likely a lot more opportunity than the 500 diagnosed and treated patients that we have previously described.

Operator: 1 moment for our next question. Okay. Our next question comes from the line of Jonathan Wolleben at Citizens. Your line is live.

Analyst: Hi. This is Catherine on for Jon. I actually have a quick clarification question about the number of patient adds. I know you said that the patient adds have been kind of tracking along the average from, like, quarter by quarter. I just wanna provide a little bit more color on how that is tracking and what your expectations are Q4. Based on your revenue guidance? Thank you.

Charles K. Gayer: Thanks, Catherine. Yes. What we described is that new patient prescriptions coming in has been very much in line. And then the net patient adds in the third quarter were quite healthy. So we expect, particularly with our transition to CareMed, with the continued demand, with the strong demand in peds that we would expect another good quarter in the Q4. And that this trend will largely continue into 2027.

Analyst: Perfect. Thank you.

Operator: 1 moment for our next question. Our next question comes from the line of Brian Abrahams at RBC Capital Markets. Your line is live.

Brian Abrahams: Hi there. Good morning. Thanks for taking our question. I am curious, are you seeing any effects on ORLADEYO use patterns from the recent launch of oral on-demand or other long acting injectable therapies for prophylaxis? And then I guess secondarily, curious what your market research tells you about the potential opportunity differences if navenibart can demonstrate every 6 month dosing versus, every 3 months. Thanks.

Charles K. Gayer: Thanks, Brian. We have said before, and at this point, it is been over a year since those. Since the oral acute came onto the market, and then also the 2 new prophyse that came on last summer. We are really not seeing any impact from the oral acute patients Some ORLADEYO patients are using it. Certainly not seeing any negative trends nor would I say it is it is anything particularly positive. It just has not had that much of an impact on our business. The oral. Or sorry.

The other longer acting injectables, what we are really seeing there is that when a patient, ORLADEYO does not work out, for them, instead of moving preferentially to TAKHZYRO, more of those patients are going either to HAEGARDA or DAWNZERA. that is what you would expect And then with navenibart, what we are seeing, again, in all the research that we have done 3 months is really transformative. Every 3 months dosing is really transformative. And then having the ability to have 3 months and 6 months as an option makes the whole package even better. And so we expect to get both doses in our label.

Based on certainly based on the Phase II data that we have seen with both doses having very durable reduction in attacks. And so to have that option, and we do not know yet which dosage form would be-- Which frequency would be most used. I think that is something we will we will learn more about. But to have both really makes navenibart a very strong for patients and physicians, really intriguing to them.

Brian Abrahams: Thank you.

Operator: This concludes the question and answer session. I would now like to turn it back to Charles K. Gayer for closing remarks.

Charles K. Gayer: Thank you. So as we described here, another really strong quarter from BioCryst as we have gone through a year of transformation, both in leadership in strategy, how we run the business. And I would also like to thank everybody, all our colleagues at BioCryst who have worked so hard during this year of transition, and I think we have set ourselves up for a really great 2027 and beyond. Thank you, everyone.

Operator: Thank you for your participation in today's conference. This does conclude the program. You may now disconnect.

This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. Parts of this article were created using Large Language Models (LLMs) based on The Motley Fool's insights and investing approach. It has been reviewed by our AI quality control systems. Since LLMs cannot (currently) own stocks, it has no positions in any of the stocks mentioned. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability.

The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.