On Tuesday, Cumberland (NASDAQ:CPIX) discussed first-quarter financial results during its earnings call. The full transcript is provided below.

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Summary

Cumberland reported a combined revenue of $9.1 million for the first quarter, marking a 5% increase excluding a previous one-time $3 million milestone payment.

The company launched a national sales promotion for Talesia in collaboration with Telesia Holdings and received FDA clearance for the manufacturing site of Vaprosol.

A strategic transaction is underway where the company will sell its commercial product portfolio for $100 million in cash, impacting future revenue growth targets.

Cumberland's clinical pipeline includes ifitroban, which received FDA Fast Track designation for Duchenne muscular dystrophy and is undergoing various clinical trials for multiple conditions.

Management highlighted a focus on advancing the clinical pipeline and expressed confidence in the company's future prospects and strategic direction.

Full Transcript

Todd

Or Talisia, an FDA approved leading treatment for Helicobacter pylori infection. In February, we announced the launch of our national sales promotion for Talisia under our co commercialization agreement with Telesia Holdings Incorporated, which we jointly own. As a reminder, under that agreement we assumed responsibility for the distribution and sales promotion of the brand in the United States. As part of the launch, we leveraged our existing field sales division with supporting marketing initiatives designed to increase awareness among gastroenterologists and other prescribers. Finally, recall, we have been awaiting FDA clearance of the site where we have successfully transferred the manufacturing of Vaprisol. Today I am pleased to announce that the FDA has just reinstated their approval status for that facility which will enable us to submit for manufacture of Vaprisol there. With approval for our submission, we will then arrange for commercial supplies to support the relaunch of the brand which is expected this year. That completes my updates for today. I'll turn it over now to our Chief Financial Officer John Hamm to review our financial results.

John Hamm (Chief Financial Officer)

John thank you Todd. During the first quarter, our portfolio of FDa approved brands delivered combined revenue of 9.1 million dollars, which represented a 5% increase after removing the one time $3 million milestone payment last year associated with the approval of Vibativ in China. Net revenue by product for the first quarter of 2026 included $1 million for Crystalose, $2.9 million for Sancuso, $2.1 million for Vibativ, $1 million for Caldolor and $1.9 million for Talesia. Turning to our expenditures, total operating expenses for the first quarter were $12.3 million, resulting in a net loss of approximately $3.3 million for the first quarter. When non cash expenses are added back, the resulting adjusted loss for the first quarter was $1.9 million or $0.13 a share. We're pleased to see that our most recent acquisitions, resulting in in additions of Vibativ, Sancuso and Talisia to our portfolio, have provided a significant positive impact on our financial performance. Note that the shipments for individual brands fluctuate from quarter to quarter based on customer buying patterns, which include the timing of international orders. There's also some seasonality to our business, with orders being strongest in the fourth quarter and traditionally lightest in the first quarter. Therefore, we believe our sales performance is best evaluated on an annual basis. Meanwhile, we did continue to achieve our goal of generating positive cash flow from operations which totaled $387,000 during the first quarter. as a reminder, we participated in the formation of a new company named Talisia Holdings Incorporated, which holds the worldwide rights to the Talisia brand and its related product assets. Cumberland invested $4 million in exchange for 30% ownership positions in the new company. We are accounting for this holding using the equity method. Turning to our balance sheet, as of March 31, 2026, we had $71 million in total assets, including $11 million in cash and cash equivalents. Liabilities totaled $49.7 million, including $5 million on our credit facility. Total shareholders equity was $21.6 million. at the end of the first quarter, as aJ mentioned, we had signed an agreement to enter into our strategic transaction. In exchange for the assets associated with our portfolio of commercial products. We expect to receive $100 million cash at closing. We will also receive $9 million in payments for our commercial a milestone payment. Cumberland will support the transition of the products for a monthly fee associated with the transition services agreement. I'd like to note that Cumberland continues to hold over $53 million in tax net operating loss carryforwards primarily resulting from the prior exercise of stock options. The assets involved in our pending strategic transaction have a tax basis of $30 million. We therefore believe that the income taxes resulting from the transaction will be modest. Finally, given the announced strategic transaction, we are no longer targeting a goal of double digit revenue growth for the year. However, our expenses will be significantly decreased after closing as apotex will assume responsibility for the sales, marketing, medical, manufacturing and FDa fees associated with the brands. I would also point out at this time that we do not see any significant change to our current clinical spending levels for 2026 as we continue to advance our line of product candidates which are in the advanced stages of development. and that completes our financial report for the first quarter of 2026. Back to you, a.J.

A.J.

thank you, John. Following the close of the strategic transaction, Cumberland will be an innovation driven, development focused company. We'll continue to progress our valuable pipeline of new product candidates designed to improve patient care and their quality of life. Our ifetroban new chemical entity, which is a potent and selective thromboxane receptor antagonist, is being evaluated in several advanced clinical programs for patients with a series of unmet medical needs. It's now been dosed in nearly 1,400 subjects and has been found to be safe and well tolerated in those individuals, resulting in an outstanding safety database. We previously announced positive top line results from Our completed phase 2 study in patients with Duchenne muscular dystrophy, a rare fatal genetic neuromuscular disease that results in deterioration of the skeletal, lung and heart muscles. During the first quarter, the FDA granted Fast Track designation for our ifetroban candidate in these Duchenne muscular dystrophy patients. This designation is intended to accelerate the development and review of therapies addressing serious conditions with unmet medical needs. Importantly, it allows for more frequent FDA interaction, rolling data submissions and earlier guidance throughout the approval process. The program also previously received both Orphan Drug and Rare Pediatric Disease designations from the fda. An end of Phase two meeting was held with the FDA last fall and we had a follow up meeting during the first quarter of 2026 to discuss both the Duchenne muscular dystrophy study results and to determine the regulatory pathway and requirements for approval. We're finalizing our plans for this important program now and once completed, we'll announce additional results and expected timelines. Meanwhile, we've also been evaluating our ifetroban product candidate in a clinical program in patients with systemic sclerosis or scleroderma. Enrollment in that study has been completed and we look forward to announcing top line findings which will be forthcoming. In addition, we have a phase 2 clinical study, the Fighting Fibrosis Trial, in patients with idiopathic pulmonary fibrosis, the most common form of progressive fibrosing interstitial lung disease. Patient enrollment in that study is well underway in centers across the United States. An interim safety analysis was conducted evaluating the first cohort of patients who completed their 12 weeks of treatment. The independent committee concluded there were no new safety signals and therefore no changes in the study conduct were needed based on those findings. Enrollment in the study has continued and we next expect to announce interim efficacy results later this year. Additional pilot patient studies of ifetroban are also underway through several investigator initiated trials. So in summary, our clinical programs are focused on select patient populations, helping to address unmet medical needs in markets that are very large from a commercial perspective for a company our size. And as we look ahead, we'll work to close our strategic transaction, support the transition of our commercial operations and sharpen our focus on on advancing our exciting pipeline of new product candidates. And lastly, I'd just like to extend my sincere thanks and appreciation to all of those at Cumberland for their unwavering dedication towards the patients we aim to serve every day. We're confident in the direction of the company, our future prospects, and in our ability to execute on our strategy. Thank you again for your continued support and interest in Cumberland and with that we can open the call for any questions. Operator, Please proceed.

Operator (Moderator)

Thank you sir. Ladies and gentlemen, that concludes the company's presentation and we will now Open the call to questions. If you'd like to ask a question, please press the star key on your phone followed by the digit one twice. That's star one one. Please stand by. Our first question comes from Alyssa Nye from IQ Solutions. Your line is now. Alyssa. You can ask your question. Yes, we'll go on to the next question. One moment, please. Our next question is Brandon Bishop. Brandon, your line is now open. Brandon, your line is now open. Yes, let me see. One second. If we can hold for a second, please.

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