To welcome you all to this Annual General Meeting of the Shareholders of the Pharming Group N.V. I would also like to welcome our shareholders who are now following this meeting through the live webcast. By my side are my fellow Non-Executive Directors, Jabine van der Meijs, Barbara Yanni, and our Vice Chair, Mark Pykett. On my right, I have our CEO and Executive Director, Fabrice Chouraqui, and our CFO, Kenneth Lynard. Regretfully, two of our Non-Executive Directors, Leon Kruimer and Elaine Sullivan, are not present today due to an unforeseen agenda conflict.
All members of our executive committee are attending this AGM either in this meeting or online. I'm also pleased to welcome the Chair of our Dutch Works Council, Mr. Tyron Jermin, and the other representatives of the Dutch Works Council. Hi, Tyron. Also with us today is Mr. Daan Hagelstein, acting Civil Law Notary of NautaDutilh. As we are a global company, this meeting will be held in English, and headphones are available for you to listen to the live translation.
Please note that the use of mobile phones and recording services is prohibited. I kindly ask you to switch off your devices now if you have not done so already. This meeting was convened in accordance with the applicable statutory requirements. The notice to convene was published on April 16, 2026, by way of an announcement on Pharming's website and a press release. The agenda and all meeting documents were published at that same moment. As a result, valid and binding resolutions can be adopted today on the voting items on the agenda.
All shareholders who are following the webcast have been invited to issue proxy with voting instructions either online, to our company, or to the Civil Law Notary of NautaDutilh. The shareholders who are present in this room and who have not issued a proxy earlier will have the possibility to cast their votes during this meeting. I will explain the voting procedures when we arrive at the first voting item on the agenda. At that moment, I will also inform you about the number of shares that are represented during this meeting.
These numbers are being verified at this very moment. You were all invited in the notice to convene to send us your questions on the various agenda items by email. We have not received any questions via email. We also have not received requests to ask questions from shareholders who are watching the webcast. All shareholders who are attending this meeting in this room will of course be able to ask questions today on the respective items on the agenda. The procedure will be explained when we arrive at the first round of questions.
We will make a full audio recording of this meeting to facilitate the drafting of the minutes. Within three months from today, the draft will be published on our website for your review. The final minutes will be adopted within three months thereafter, by November 28, 2026, at the latest. Ladies and gentlemen, I would like to move on to the second agenda item, the annual report for the financial year 2025. This agenda item includes several sub-items. I invite our CEO, Fabrice Chouraqui, and our CFO, Kenneth Lynard, to elaborate on the business, the operations, and the results for the financial year 2025. Fabrice?
Thank you, Richard. Good afternoon. It's a real privilege to stand before you today, a bit more than a year into my role as CEO of Pharming. Over the past year, I've learned many things about this company. I've learned about the power of our science. I've learned about the dedication of our employees. I've learned about the resilience required to build a rare disease company from the Netherlands into a global biopharmaceutical business.
Above all, I've learned something very important about our shareholders. Many of you have supported Pharming for many years. You believed in Pharming when the path was not always easy. You provided support that allowed this company to progress and ultimately change the lives of thousands of patients suffering from rare and highly debilitating diseases. You paved the way for new shareholders to appreciate our growth prospect and the significant value of our pipeline, to embrace our vision to scale and to reach many more patients.
That is where I want to begin today, with a patient. Earlier this year, I had the privilege of meeting Victoria and her husband at their home outside Atlanta, Georgia. Victoria lives with hereditary angioedema, or HAE. Like many patients with rare diseases, her journey was long. It was frustrating and often frightening. She had to fight to understand what was happening to her body. She had to fight to get the right diagnosis. Then she had to fight to access a treatment that worked for her. Victoria told me that since being treated with RUCONEST, she got her life back.
Since being treated with RUCONEST, Victoria can once again enjoy the previous moments that many of us take for granted. Time with her family, daily life with more confidence, and the ability to look forward. For me, Victoria's story captures why Pharming exists. We are here to restore possibilities for people who have lost them because of rare and devastating diseases. When we succeed, we create value not only for patients and their families, but also for our shareholders.
That patient purpose must remain our compass. At the same time, we are a public company. We have a responsibility to deliver value to you, our shareholders. I believe deeply that in rare disease, patient impact and shareholder value are not competing objectives. When we identify serious unmet medical needs, execute with discipline, and allocate capital diligently, we create value for patients and shareholders together.
This is the Pharming that we are building. Over the past few years, Pharming has changed significantly. We have evolved from a company largely defined by one asset into a company with two commercial medicines, a durable revenue base, and a high-value pipeline with the potential to transform our scale and our profile. Importantly, the opportunity ahead of us is larger than at any point in Pharming's history. We are no longer speaking about sustaining what we've built.
We are building toward a future with multiple source of growth, broader patient reach, and the potential to create value at a very different scale. RUCONEST remains the foundation of our portfolio. It is a trusted medicines with a differentiated profile in an increasingly competitive HAE market. Joenja is still at the beginning of its life cycle. It has important commercial and pipeline opportunities ahead.
Now, napazimone, or KL1333, in primary mitochondrial disease is another potentially significant late-stage rare disease opportunity to our pipeline. Our ambition is clear: To build Pharming into a leading global rare and ultra-rare disease company. A company with Dutch roots and global reach. A company that combines scientific focus with commercial excellence. A company that has the financial discipline to generate cash, the courage to invest in innovation, and the execution mindset required to deliver.
When I joined Pharming, I said that we should be proud of what the company had achieved, and we should be. The work done over many years created the platform that we have today. I also said something else. What got us here will not necessarily take us where we want to go. The next chapter requires sharper execution, stronger financial discipline, and a culture built for performance.
That is why 2025 was such an important year for Pharming. We took meaningful steps to strengthen how Pharming operates and to position the company for its next phase of growth. We put in place a more rigorous approach to performance management. We reinforced our financial disciplines to optimize capital allocation. We brought new leadership into key roles, including a significant number of highly talented female leaders.
We also rolled out a set of values that are essential for this next stage of Pharming's development. We put patients at the heart. We make it simple. We get it done. We act with urgency. These values are not slogans. These are standards. They are the way we must operate if we want to compete and win in global rare disease. Together, these actions are helping transforming Pharming into a more focused, accountable, and performance-driven organization, with faster decision-making and the mindset required to turn our opportunities into patient impact and sustainable shareholder value.
We delivered very strong performance in 2025. Our total revenue grew by 27%. We achieved operating profit compared with a loss in 2024. We generated $54.7 million of net cash flow from operations, and we ended the year with $181.1 million in cash and marketable securities at a higher level than in the previous year, even after acquiring Abliva and adding napazimone to our pipeline. This matters. It matters because Pharming is one of a limited number of biotech companies with commercial revenues, operating profitability, and positive operating cash flow.
It matters because our cash-generating commercial business gives us the ability to invest in our pipeline. 2026 will be another stepping stone in the development of the company, with further financial growth expected, the materialization of several Joenja growth drivers, and significant pipeline milestones. The beginning of the year has also reminded us that biotech is never without challenges, and that we need to continue to strengthen our execution capabilities. First, on Joenja.
We were disappointed to receive the Complete Response Letter from the FDA for the APDS pediatric label expansion. I know that regulatory setbacks are frustrating. They are frustrating for patients, they are frustrating for physicians, they are frustrating for employees, and they are very frustrating for shareholders. What matters after a setback is how an organization responds and the learning we take. Our team moved quickly. We engaged constructively with the FDA. We clarified the path forward.
We resubmitted the pediatric sNDA for the highest doses on the day we received the meeting minutes. We are now in the process of finalizing an sNDA submission for the lower doses that we plan to file this summer. That is execution. Second, on RUCONEST. RUCONEST revenue declined in the first quarter. This was largely expected due to inventory drawdowns at specialty pharmacy, which we had discussed previously.
The commercial exit from non-U.S. market also contributed to the year-on-year decline. We made that decision last year as part of our renewed financial discipline because the commercialization of RUCONEST in this market without commercial support was not financially sustainable. The Q1 RUCONEST revenues do not change our conviction in the durability of RUCONEST as a meaningful and profitable part of Pharming's future. HAE is not a simple winner-takes-all market. It is a market where patient needs differ significantly. Convenience matters.
For patients with more severe and frequent attacks, reliability matters enormously, and speed of relief matters. We see that for difficult-to-treat patients, physicians continue to see a differentiated role for RUCONEST. Yes, we will continue to see some patients trying a new treatment option, but many won't because of the severity of their disease. Some who tried are coming back, and new patients continue to start RUCONEST. Despite some expected variability in the near term, RUCONEST is poised to remain a cornerstone option for the patients who need its efficacy and reliability.
It remains a durable cash engine, it remains for patients like Victoria, far more than a medicine. It can be the difference between living around a disease and living life again. Now let me turn to Joenja, a key growth driver for the years to come, and the possibility for Pharming to realize for the first time, $1 billion revenues. Joenja is just at the beginning of its life cycle. In APDS, we have multiple commercial growth catalysts. We are expanding geographically. We launched in the U.K. last year.
We received regulatory approval in Japan in April, and we just received regulatory approval in Europe last week, which is a key milestone. We are also strengthening our ability to find patients who have too often gone undiagnosed or misdiagnosed for years. Recent scientific work published last year also reinforces that APDS may be much more prevalent than previously estimated, as better genetic interpretation may help doctors diagnose patients who previously had variants of uncertain significance, VUS, or even unknown variants. Joenja has potential which lies beyond APDS.
We are also evaluating leniolisib in broader primary immunodeficiencies with immune dysregulation. This year, we expect readouts from two phase II trials, one in genetic PIDs with immune dysregulation and one in CVID with immune dysregulation. These conditions have significantly larger prevalence than APDS. The genetic PID opportunity is estimated to be approximately five times larger, and CVID with immune dysregulation, approximately 26 times larger.
A poster recently presented at the Clinical Immunology Society annual meeting supports leniolisib potential in these settings. It showcased some early clinical evidence in six patients with these conditions, patients who have been treated with leniolisib for up to two point five years as part of our early expanded access program. These programs in larger PIDs could meaningfully expand the addressable population for Joenja and create substantial long-term value. There is also napazimone for primary mitochondrial disease. Primary mitochondrial disease, or PMD, is a devastating condition.
There are over 15,000 patients in the U.S. and over 15,000 in the top five EU countries who could potentially be treated with napazimone. There is currently no approved treatment for PMD. Napazimone is in a registrational study with enrollment expected to complete this year and data expected next year. Napazimone is exactly the type of opportunity that fits Pharming's future. A serious rare disease with high unmet medical need, a potentially first approved treatment, and a clear development path.
Together, the new leniolisib indications and napazimone each have the potential, if successful, to become $1 billion revenue opportunities. That is why I believe that the Pharming investment case is becoming broader, is becoming stronger. It's becoming more compelling. We are recognized as a durable cash engine despite potential short-term volatility in revenues. We have Joenja as a growing commercial asset early in its life cycle.
We have leniolisib pipeline opportunities that could significantly increase the addressable patient population. We have napazimone as a late-stage opportunity in primary mitochondrial disease, and we have now the financial discipline to fund our current priorities and future expansion while maintaining a clear focus on value creation. We will not grow for the sake of growth. We will invest where we see the potential to expand and de-risk our pipeline, where we see the potential to strengthen our strategic positioning and generating attractive returns for shareholders.
Our business development team is applying this discipline to every opportunities that we assess, ensuring that our growth ambition is matched by a clear path to value creation. You can see the Pharming that is emerging, a commercial-stage rare disease company with global ambitions, differentiated assets, meaningful catalyst, cash flow, and an increasing disciplined operating model. As we look ahead, our aspiration is for Pharming to be recognized as a global leader in rare and ultra-rare disease with a distinctive place in the world.
A company that patients, physicians, employees, and shareholders trust because of our ability to bring forward medicines which are differentiated, medicines where few others are willing to go, and because of our ability to change the lives of patients who have too often been overlooked. When I think back to my meeting with Victoria, I am reminded that the work we do is both deeply human and highly demanding. Patient needs option. Physicians needs confidence. Families needs answers. The next chapter of Pharming will be built by honoring our history and delivering on our vision to create sustainable value for shareholders by changing the lives of patients who need us most. Thank you. I will hand over to Kenneth now.
Thank you, Fabrice, and good afternoon, everyone. I'm pleased to now provide you with some further insights to our financials, our strong financial results for the year 2025, and also the outlook for the current year 2026. Total revenues in 2025 grew by 27% to $ 376.1 million, driven by robust double-digit growth for both products. RUCONEST grew 26% versus the year before, and Joenja 29% over 2024. Our gross margin remained stable at approximately 88%, and that despite the fact that in 2025, we recorded the first Joenja-related sales milestone of $ 5 million.
Operating expenses in total increased by 14%. When we exclude $ 4.1 million in restructuring related costs, but also all the $ 29.7 million related to the Abliva acquisition that we made in the beginning of 2025, our operating expenses only grew by 2%. On a like-for-like basis, very modest growth. That explains and displays the strong financial discipline and cost management that we're having in Pharming. In total, when we are looking at the adjusted operating profit, excluding these non-recurring expenses related to the acquisition and other offsetting items, we generated $ 36.4 million, compared with a loss of $ 8.6 million the year before.
Cash flow from operating activities totaled $ 54.7 million versus being slightly negative the year before, showing the improved profitability and the ability for Pharming to generate cash from operations. The total cash that Fabrice already alluded to ended the year by $ 181.1 million, which was an increase of $ 11.7 million versus the year before. That after having spent round about $ 68 million in cash out for the acquisition of Abliva. That highlights the strength of the company's ability to generate cash overall.
Looking at the Q1 performance of 2026, we generated $ 72.4 million in revenues, which overall was down 8% versus first quarter of 2025. RUCONEST declined by 15%, mainly due to the U.S. inventory normalization, which contributed to about 8% of the decline versus the year before, and our planned exit from the non-U.S. markets, which was about a contribution of 3%. Q1 is also typically the weakest seasonal quarter for RUCONEST due to ordering patterns and these inventory dynamics. Joenja revenues increased by 34% year-on-year, driven by strong momentum in the U.S., overall continued patient growth, and growing international demand.
Adjusted operating profit declined slightly year-over-year, and the adjusted Q1 figure from last year excludes $ 7.8 million of Abliva-related expenses in the numbers you see on the slide here. This year in Q1, we included round about $ 3 million in additional R&D investments related to the Abliva acquisition and therefore the napazimone asset that Fabrice also referred to. We generated positive operating cash flow in Q1, and that reflects the continued strong discipline around cost, and overall capital allocation.
Cash and marketable securities decreased $ 9.3 million during the first quarter of this year, mainly due to $ 12.3 million being paid related to an early termination of the DSP lease facility in Oss . Now looking into the full year guidance and our outlook and expectations, we expect total revenues in the range of $ 405 million-$ 425 million, representing a growth of approximately 8%-13% versus 2025. Growth will be driven by continued U.S. expansion of RUCONEST and strong acceleration of Joenja, partially offset by our RUCONEST exit from the ex-U.S. markets.
For 2026, we do not assume any commercial milestone payments related to Joenja, and gross margin is expected to be around 90%. Operating expenses are expected in the range of $ 330 million-$ 335 million, including approximately $ 60 million in incremental R&D investments to advance our pipeline with up to $ 30 million allocated to napazimone.
This outlook also reflects the $ 9 million benefits from the 20% G&A structural headcount reduction that we announced back in October 2025, while marketing and sales cost overall remained relatively stable. We remain committed to disciplined cost management and focused investments to support both short- and long-term value creation. As previously stated, our available cash and future operating cash flows are expected to fully fund all pipeline-related investments, including pre-launch activities. With that, I would like to hand back over to Richard.
Thank you, Fabrice and Kenneth. I would now like to invite our shareholders in this room to ask their questions regarding this agenda item. During today's AGM, we will follow the same procedure that we used during the previous general meetings, which means that we invite you to go to one of the microphones if you would like to ask a question. Please raise your hand if you're not able to walk to these microphones, we will then come to you with a hand microphone.
Before asking your first questions, you are kindly requested to state your name and, if applicable, the name of the shareholder that you represent. Please do not ask more than three questions at the same time to enable other shareholders to ask their questions. Are there any questions on the management report? Come on.
Good afternoon. My name is Keyner. I speak on behalf of SVB. Thanks a lot for your presentation, also for your annual report. I think the storyline is very clear and very optimistic. In summary, I am very happy that RUCONEST is still there as a cash cow, which helps fund all the other initiatives that you are having. That is a very different business case than what we have been seeing 10 or 20 years ago, so a different kind of company.
I have got two topics for this round, Mr. Chairman. The first one concerns the confidence that we can have that RUCONEST will remain our cash cow for the near five or 10 years. You have mentioned yourself that Q1 was disappointing as far as the development of RUCONEST is concerned. I heard the CEO saying, well, as expected, the market reacted negatively, so this can be a one-off.
I understand that if you stop selling RUCONEST actively internationally, that will drop a little bit. There may have been some inventory problems in the U.S., so that may be one-off. Could you elaborate on how much this one-off would be, or can we count that RUCONEST not only will remain the cash cow, I trust that, but will be a cash cow of at least a similar size as what we've been seeing in the last one or two years? Is it a kind of base level or is it indeed a risk that it will drop 5% every single year? That would be my first question. Second question, I was not the only one, but I think a number of people have been at least suggesting this in the past several years.
Why not just focus on the U.S. since all the business is coming from the U.S.? Also, you got the pricing issue, most favored nation clause. Trump, but any president should say the same thing. Why should the U.S. patients pay two or three or four or five times as much as a patient in Denmark or Holland or in Spain? I understand that you made a decision indeed to let's just focus on promoting and selling our RUCONEST in the U.S. I understand it. I'm not the only one who said it. You made the decision yourself, and plenty of shareholders would've said the same thing.
However, in the introduction of Mr. Chouraqui, he said, "Well, there's no conflict, there's no competition between patients and shareholders." Actually, if we're honest, there is, isn't there? I understand that you're still delivering, supplying RUCONEST to existing patients, but new patients in Denmark or in Singapore will not be able to buy RUCONEST, I assume, or do they have to travel to the U.S. and apply to get it? If we're really honest, isn't there really a competition in the end? In the end, shareholders have won by now. That's the second question on this topic. Is that good? Two questions. The key question I'm having is how long-
RUCONEST.
...be confident that RUCONEST will fund this organization? That's actually the most important question I'm having right now. Thanks.
First of all, it's great to see you again. Thank you for joining our shareholders meeting. I'm going to ask Fabrice, because we actually discussed this. We just had a Board meeting before this AGM, as we often do. We discussed this actually actively at the board meeting. I'm going to let our CEO comment on those two questions.
Absolutely. Thank you so much, Richard. Thank you for your question. As alluded to in my speech, RUCONEST is a treatment which has a very differentiated value proposition for a subcategory of patients in the HAE on-demand market. As such, it's being used mostly by severe patients that have more frequent crisis, patients that have more severe crisis, patients that need the efficacy of [nicely] treatment like RUCONEST, and specifically its reliability.
As such, because of the differentiation of RUCONEST compared to other treatments, we believe strongly that RUCONEST is poised to remain a cornerstone treatment option for these difficult-to-treat patients. As such, is going to remain a durable cash engine for the company. The HAE market is evolving. There are new prophylactic treatment. There is and there will be other on-demand treatment. In a more crowded market, what matters is your differentiation.
I was very impressed with the work that the team has done for quite some years to differentiate RUCONEST and ensure that those patient who can benefit the most are treated with RUCONEST. That such, I think that actually will be the ground, that will prepare up the ground for the sustainability of RUCONEST. Let's not also forget that RUCONEST is a very complex drug to manufacture. As such, we are not aware today of anyone who is attempting to replicate the manufacturing process.
We expect RUCONEST to remain a cornerstone treatment for those difficult-to-treat patients, a sub-segment of the market, and we expect RUCONEST to remain a durable cash engine for the company. When it comes now to the international expansion and specifically. As you saw, we are using Joenja as a platform to expand geographically. It is true that RUCONEST had been introduced in a number of countries, but there was no commercial support. When we looked at it was not financially viable. It's always a difficult decision to take a drug out of a market.
We need to understand that such decision also will allow us to allocate our capital more efficiently and therefore treat more patients in other markets on other drugs. That's a decision that we've made. However, as you pointed out, we've made sure that existing patients on RUCONEST will continue to access the drug, and there are always mechanism for patients who really need RUCONEST and cannot access any treatment options to access RUCONEST. Again, we live our mission to patients whilst also ensuring that we allocate capital optimally. It's always a balancing act, but something that obviously, as a leader of a company, I have to do.
Yeah, if I may follow up on that. The first topic, to what degree will RUCONEST remain the cornerstone? Well, if RUCONEST will be half the kind of revenue, it will still be cornerstone. What I'm concerned about, that it will be half or 70% of what it is or what it has been last year, instead of around 100% or maybe with a little growth. Could you at least indicate whether the kind of volumes you've been selling, the revenue you've been making with RUCONEST in the last one or two years is more or less a base level to continue upon in the next several years?
We have indicated during our Q1 earning call that we expect low single-digit growth for RUCONEST this year. As you saw on the slide that I presented when I spoke about the dynamic for RUCONEST, there are outflow of patients and there are inflow of patients. It's not like there are massive outflows and no inflows. It's a dynamic that we're going to have to learn to manage. That's why commercial discipline is absolutely essential, and I'm confident that RUCONEST will remain a cornerstone treatment, not only for the company, a durable cash engine for the company, but also a cornerstone treatment for these patients who actually, like Victoria, cannot be treated by any other treatment.
Let me then ask the question in a different way. If in three years from now, RUCONEST will be 80% of what it was last year, would you be disappointed?
Listen, my goal is to ensure that every patient that could benefit from RUCONEST is being treated with RUCONEST. A market, even with more competitors, provides opportunities. It's a market which is more dynamic, where there are more switchers, and where more patients actually could be considered for RUCONEST. I think we should look at it as a very dynamic market.
Well, I understand. You are not able, not willing to give us more comfort. Well, that makes me a little bit more pessimistic. The second question about your decision financially, very understandable and also something that has been suggested by many people in the past, this board has decided indeed, let us just focus on the U.S. What makes Joenja and the associated diseases that it will be applied upon so different that this would be financially viable to also sell it outside of the U.S.? What is the difference between Joenja, the kind of distribution mechanism compared to RUCONEST?
We have selected for Joenja eight markets, where we believe that we can develop a financially sustainable business. As such, we have employee on the grounds to help and support the commercialization of Joenja. Unfortunately, even when you have an amazing drug like RUCONEST or Joenja, you cannot just introduce it in the market and have it prescribed.
You have to support it. There was no such commercial support for RUCONEST. For Joenja, we have actually looked at the various market across the world and identified those as eight markets, and that's going to be a start. Given that it's going to be a staggered launch, we expect to be able to manage the two aspect of our mission, expand the outreach of Joenja whilst being financially responsible.
Very clear. Thank you very much.
If I may add, we also are managing the price corridor very tightly for those launches so that we don't get into difficulties with reference pricing across geography. We've been very thoughtful about that. With regard to RUCONEST, we've guided that we're going to have-- so f ar, we gathered a 3% f or this year growth. It's a low single-digit growth. I think that's what the best we can say about RUCONEST. We're very happy with the fact that it's serving these patients who have very severe needs.
It's the only treatment that they have that can really act so rapidly. You could see actually pictures of those patients. It's pretty amazing. They're completely devastated by the swelling, which can be actually life-threatening, and then they respond super quickly to this agent, which is not the case with anything else on the market.
We are very happy that with our capital-
Yeah.
...our company is helping so many people.
Absolutely.
There are plenty of companies, even in your industry, that they're looking beyond one year, saying so the question that I did ask, would you be disappointed if RUCONEST would be 80% of the revenue that you've been booking in 2025? No real answer came to that. That makes me suspicious a little bit.
It's always a balance between investment and return. That's why I cannot answer your question. If we decrease significantly the investment behind RUCONEST-
You will not.
...I may tolerate actually a lower return. If I increase investment, I will expect a higher return. This is the basic of economics.
Yeah, but I'm pretty sure you're extremely intelligent, but you would not be so intelligent if you would decide in the next couple of years to decrease investment RUCONEST in the U.S., because that's your cash cow, and the amount of investment needed to keep the cash cow running is by definition a lot lower than it would be for Joenja implementing it, I don't know, in Japan or so.
That's why RUCONEST will remain a very important-
Cornerstone.
...drug for the company, we'll continue to support it. What's important is that beyond RUCONEST, we have also very significant growth drivers that can generate very significant shareholder value. We have to look also beyond RUCONEST to ensure that we write the next chapter of Pharming.
I fully agree, and I think everybody in this room agrees on that, but it would feel much more comfortable if the cash cow would be at least be a similar size in the next four or five years. Thank you.
We'll be working on that.
Any other questions on this agenda? Yes. Please state your name and if you are representing a shareholder, who that is.
Yes. Good afternoon. My name is Joris van der Louw. I am presenting myself as a shareholder. My question is on the VUS, the variants of uncertain significance. There is little to say on this, maybe because we do not hear a lot of news on it. Can you tell us a bit more on the work that has to be done and the timeline? Because in earlier analyst calls, the bulk of patients could have come in in 2025. What are the expectancies here?
Thank you so much for your question. Again, as I mentioned earlier, those patients with a variants of uncertain significance are in need actually of an answer about the disease they are suffering. These are patients who have had a genetic test, and the test became inconclusive. They had hopes that after the genetic test, the doctors will be able to tell them from what condition they suffer and whether there is a treatment.
Unfortunately, this hope were not fulfilled. We have an opportunity actually to fulfill their hope. That's why we have been investing in generating data that allows a portion of these patients potentially to be reclassified as APDS. We sponsored a very significant piece of research that was published in a top medical journal, "Cell" in June last year. That suggested that a number of new variants could be reclassified as APDS.
The team who published this data engaged with genetic testing companies to see how they could incorporate the data in their model, in their methodology to reclassify those patients. Unfortunately, there were some shortcomings in the data that needs to be addressed for those genetic test labs to reclassify those patients. The team decided, obviously in agreement with us, decided actually to get back to the drawing board, get back to the bench and generate those additional data, so eventually those patients could be reclassified.
This is exactly what is happening. A few weeks ago, I did visit actually this team of world-renowned scientists in Columbia University in New York City. The work is happening. It is science. It is high science. We are using the latest of base editing technology to carry out this work. It's difficult to provide a timing, but as soon as we know, obviously, we will provide actually more color in terms of expectations when the data will be generated, sorry, and what it could mean for the genetic test lab. Again, the dialogue is ongoing, the work is ongoing, and the opportunity remains the same.
The opportunity of maybe 20%-
Of reclassifying a portion of those VUS patients, indeed. You should know that actually every day, the number of patients with a VUS is increasing, because the more patients are being tested, the more VUS there is. Clearly, there is a duty. We have a duty to find a path forward, and we're doing everything it takes to ensure that not only we have high-quality data, they were published in the top journals, but also those quality data are acceptable for commercial genetic test lab companies.
There's a model built once. Building a second model, you could have an idea of a timeline doing this.
This is science, there are some more data being generated. We don't know exactly when the data is coming. I was at Columbia University just a few weeks ago. I wish I could tell you. As soon as we have an idea on when the data will be generated, we'll update our investors.
Okay.
The work is ongoing. The work is ongoing as we speak.
Yeah. A question on the revenue for 2026. You're keeping the bandwidth, you already told us, starting at $ 405 million. Calculating this with the Q1 result, it would mean a spectacular record revenue per quarter the next quarters. That's quite a confidence you have for this year.
Kenneth, you want to address?
First of all, I think it's important to keep in mind that Q1 was broadly in line with what we expected when we originally gave the guidance for the full year. Secondly, you are right, there are some dynamics around Q1. From my presentation earlier, I also indicated that we have seen inventory drawdown. That's the normal cycle within the year that happens in the beginning of the year.
It was a bit unusual in the year before that impacted us with about 8%, so that would be in the range of $ 5 million-$6 million revenues. We had the exit from the markets outside of the U.S. for RUCONEST, which is about half of that impact. In line with our projections for the year, that will take us into that range that you mentioned, and which, based on the performance year to date, that has been broadly in line with our expectations that we remain confident around.
Okay. Missing the children's option in the U.S., that could have been a catalyst for the revenue this year. Even though you missed that, you still keep the bandwidth up, yeah.
Maybe one quick comment. When we originally gave our guidance for that year, we said we are not sure when that approval will come, so we kept that out of the guidance. In the recent earnings call we had early May, we did indicate that we now expect that to come at a certain point of time later in the year, and we will pick up some revenue from that, but the guidance range from the beginning of the year remains.
Okay. Thank you.
Thank you very much. Any additional questions on management report? Yes. Please state your name again.
My name is Gerjon Hilsenberg, private investor. I have a few questions. In the first place about RUCONEST. I read about normal competitors, of course, and you've expressed your confidence in your own formula with RUCONEST. I read about Intellia Therapeutics, and they have CRISPR technology. That basically means that if they operate successfully in the future, they can eliminate the disease altogether. That would mean a real threat.
If I relate it to the price of the shares, they increased this year to date, already a 50% growth. Shares of Pharming were the opposite. That strikes me also is that the Pharming price is this year dropped from $ 178 at the highest level to $ 104 or something. Your analysts do the opposite. They predict rates of $ 2, $ 350 and whatever.
They apparently have more confidence in the shares of the future, of the share price, than apparently the shorters. I follow the shorters as well. The shorters, again, stepped in at the moment just before you published your quarter one results. That amazes me how that is related to each other. You told us that the story was known, that the dip would be expected in the first quarter.
Apparently they have a pre-knowledge of those things, and they step in because they were at a level of 6%, then it dropped to about 4%, and now it's roughly 5%. I'm amazed about how they look at Pharming and how the actual analysts look at it. That was question one. First maybe related to Intellia Therapeutics. That would interest me most at this moment.
You have another question as well?
Yeah, I have other questions as well.
Okay. Why don't we start answering that question around Intellia?
Yeah. Intellia is developing a treatment for HAE. You are completely correct. They've actually published data recently.
Yeah.
The data don't suggest that their drug will be able to eradicate HAE. When you look at the data, they are marginally better than available treatment today. I think if I were a patient, I would welcome a new treatment option. Based on the data that are publicly available, nothing tells us that this treatment will redisrupt completely-
Okay.
...the HAE treatment category. The HAE treatment category has a number of treatment options, which are differentiated, that provides actually different options to patients. Intellia will probably be another one if approved. I don't want to comment, obviously, on their drug. It's a drug that modifies, obviously, the genetic code of a cell. Some patients will probably be eligible to this treatment and interested in this treatment, some don't. Again, I see it as a new treatment option in a market which is expanding.
Okay. Thank you. If I may have two other questions. One is, I read about Trump ex government, a new platform where prices for medicines are dropped heavily from 30%, 40%, 50%, 60%, 70%, 80% even. Is RUCONEST potentially liable to be on that platform, whereby the prices will be coming down? Is that eliminated because it's unique?
No. There are only a very small number of treatments on that platform at the present time. I don't even know whether it is fully operational.
Yeah.
There is no plan for RUCONEST to be on that platform.
Okay, you can decide it yourself whether you want to be on the platform or not?
No, I can't decide. If we want to be on that platform, we should engage with the U.S. administration, but today it's being restricted to a number of drugs that the U.S. administration has defined in their discussion-
Okay.
...a few companies. These are often drugs that have a very large patient population.
The last question. I read about two class actions in the U.S. about shareholders being unhappy with the drop of the price of the shares. Could you elaborate on that, perhaps? Whether that is still ongoing or that has been skipped.
Whenever there is activity in stock, usually when it drops, especially in the U.S., you have these law firms that just basically announce that they would be representing shareholders to basically do some kind of class action. This is basically, they're trolling for interest.
Yeah.
That doesn't mean that they actually have filed. They're just hoping that somebody's going to say, "Okay, I'm very upset." They have to build a case, and the case is like, look, sometimes things happen, like in our case, because of the Complete Response Letter, we had an impact on the stock price. Don't forget the stock, compared to last year, had gone up quite a bit. It came down and then now since then, it's gone up a little bit again. That's the nature of the U.S. environment. Yeah, they will basically make an announcement like that, but the announcement doesn't mean they are filing a class action. It's just simply, "I'm looking for business.
Thank you.
Yeah.
Okay.
Welcome.
Thank you.
Any other questions? All right. I would now like to close agenda. First of all, thank you very much for all these very Oh, yeah, one more questions. Yeah.
Sure. Well, I've one question.
Yeah.
Not for you, but for the shareholders.
Yeah.
I'm asking you, don't lend out your shares because when it's pennywise, pound-foolish. It's going downward. Yeah. It's unbelievable. Those guys are. Think about it. Thank you very much.
Thank you very much.
Thank you.
I would now like to close the agenda Item 2A and ask Barbara Yanni, as a member of the Remuneration Committee, to present to you the Remuneration Report for the year 2025. This report is included in our annual report and on today's agenda as Item 2B. Barbara?
Thank you, Richard. Good afternoon to our shareholders in the room and online. On behalf of the Remuneration Committee, I will present to you the Remuneration Report that is included in the 2025 Annual Report. During this presentation, I will highlight the implementation of the Remuneration Policy in 2025 for the Executive Director CEO. The fees of the Non-executive Directors will be addressed under agenda Item 4.
During last year's AGM, we presented to our shareholders the Remuneration Report for the financial year 2024. The Remuneration Committee highly appreciates that 98.88% of the votes were cast in favor of the presented report. After the 2025 AGM, we engaged an international strategic consultant to support us with the analysis of the feedback we received from the proxy advisors and from investors to ensure that we'd have continued alignment with prevailing best practices.
Compared to last year's report, we have increased the level of detail to explain the scores on the performance targets in 2025. Looking at the implementation of the remuneration policy in 2025, the Remuneration Committee is pleased to note that Pharming delivered a very strong performance in 2025, with record RUCONEST revenue, while Joenja uptake accelerated with rising U.S. patient demand and international expansion.
As explained in the remuneration report, this strong company performance in 2025 translated into a total score of 147.4% on the targets that had been set for the CEO's short-term incentive for the year 2025. A summary of the 2025 financial results is now being projected on the screen. I invite you to read the detailed scorecard on all financial and non-financial targets for 2025 short-term incentive that can be found on page 110 of the annual report.
The remuneration report also provides details on the resulting prorated payouts to Sijmen de Vries as our Executive Director, CEO until his resignation on March 4th, 2025, and to Fabrice Chouraqui, our current Executive Director, CEO. Sijmen de Vries, as our former CEO, also held conditional shares under the long-term incentive plan for the performance period 2023 through 2025. The scores over the performance period on one measure, total shareholder return, and two, the strategic corporate executives, determine the total vesting percentage for these conditional shares.
The slide currently shown on the screen illustrates the calculation of the combined vesting level of 81% and the resulting prorated share award to Sijmen. At the extraordinary general meeting in March 2025, our shareholders approved the appointment of Fabrice as CEO. Shareholders also approved Fabrice's compensation package, including his first tranche of awarded conditional shares, which will be eligible to vest after the end of the performance period 2025 through 2027. You will find an outline of the remuneration package of Fabrice for 2026 on page 116 of the annual report.
His annual base salary for 2026 has been set at $801,750, which reflects both the strong performance by our company over 2025 under the leadership of Fabrice and a U.S. benchmark review. Looking forward, we have set challenging short-term and long-term goals and objectives for the incentive plans that you will find outlined on pages 116 through 118 of the annual report. With that said, I would like to invite our shareholders to ask their questions. Are there any questions?
I do not see anyone raising their hands or coming to the microphone, so thank you, Barbara.
You're welcome.
We'll now proceed with.
Oops, sorry.
It wasn't me.
It was off.
We will now proceed with the voting on the remuneration report for the financial year 2025. In accordance with Dutch law requirements, you are asked to cast an advisory vote. All votes in favor of the report mean that the remuneration report is appreciated and deemed positive. Any votes against the proposal are understood to imply that the report does not meet the expectations of these shareholders. The advisory vote will not be binding, but we will explain in next year's remuneration report how the vote of the general meeting was considered.
As promised during my opening remarks, I will first explain the procedure for voting during today's meeting. Prior to this meeting, we received proxies and voting instructions from several shareholders on the designated voting items on the agenda. All shareholders who are following the webcast and would like to vote also had to issue a proxy prior to this meeting. All proxies have been processed and verified by our Civil Law Notary.
Shareholders who are with us in this meeting room and who have not yet issued a proxy will be able to cast their vote on the designated voting items during this meeting. These shareholders have received, at the registration desk today, their personal login credentials to log in to this meeting to cast their votes. Please raise your hand if you have not received these login details or if you are encountering any technical problems.
Once I have opened the voting on any agenda item, you are invited to press four if you wish to vote in favor of the proposal, or to press against if you would wish to vote against the proposal, or to press abstain if you do not wish to vote. These votes will not be included when determining the voting results if you hit abstain. You will be able to change your vote until the voting rounds has been closed by me. After each round of voting, the total number of votes cast and the final voting result will be shown on the screen. This will be done by adding up all votes already received by means of proxy and the votes cast during this meeting.
The acting civil law notary will monitor this. A total number of 820 shareholders and 136,228,886 shares is represented today and is entitled to vote on all items on the agenda. We will proceed with the voting on agenda Item 2B. Our shareholders are proposed to give a positive advice on the presented remuneration report for 2025. I have now opened the voting. Please cast your votes. I will now close the voting. The voting result will be shown on the screen in a few seconds.
Here we go. I'm pleased to confirm that the proposal is supported by the advisory vote by our shareholders with a 99.68% majority. Thank you very much. The next item on the agenda is agenda Item 2C on Corporate Governance. Jabine, could you please introduce this item as chair of our Corporate Governance Committee? Following this, I will introduce agenda Item 2D, concerning a summary of the dividend policy. Thereafter, we will address the questions from our shareholders regarding both sub-items jointly. Jabine?
Thank you, Richard. Agenda Item 2C has been included to update our shareholders on material developments in the field of corporate governance. As you are aware, our American Depositary Shares have been listed on the Nasdaq Stock Market in the U.S. since December 23, 2020. Our ordinary shares have continued to trade on the Euronext in Amsterdam. Pharming continues to take all steps required to ensure compliance with applicable U.S. regulatory requirements. Pharming filed on April the 16th its annual report for 2025 on Form 20-F with the U.S. Securities and Exchange Commission.
You can find that document on our website. As mentioned earlier, we are very pleased that Deloitte issued an unqualified opinion to confirm that our internal control framework is now compliant with the U.S. Sarbanes-Oxley Act, SOX. On page 74 of the annual report, you will find an outline of how Pharming has applied the Dutch Corporate Governance Code in 2025, including the new risk management statement that has been required since last year.
We performed a gap assessment and, where relevant, implemented updates to our governance, risk management, and internal control reportings. Page 99 provides more details on our risk statement for 2025. The slide is now shown on the screen that provides a summary of the few remaining deviations from the code that are deemed consistent with the size and activities of our company. There is one new deviation.
Our shareholders approved on March 4th, 2025, that Fabrice Chouraqui will be entitled to a severance pay equal to 200% of his fixed annual base salary in the special event of a termination of his mandate as CEO, without cause, within 12 months following a change of control of Pharming. The code, however, provides that the severance payment to the CEO will not exceed the annual fixed salary amount. In all other events, Pharming fully complies with the provision.
Thank you, Jabine. With respect to the dividend policy, that is on the agenda as item 2D, Pharming continues to maintain its existing policy of not paying dividends. The Board of Directors does not anticipate paying dividends in the coming years. We will now address the questions on both corporate governance and our dividend policy. I invite our shareholders in this room to go to one of the microphones for that. Are there any questions? Yes, please.
Yeah. My name is Keyner. I speak on behalf of SVB. Actually, my question was triggered by your next agenda point, about the auditor, but it concerns governance, and it concerns also a little bit the remuneration for the non-executives. I saw a very surprising comment, not negative, but a very surprising comment in the next agenda point in the announcement, where you explained that one of the Executive Board members, not a Director, but I think the level below, had a personal relationship with somebody working within KPMG, and therefore he or she has to sell his or her Pharming shares. I was very surprised with that.
The first question is, how do you make sure, from a governance point of view, that all your employees do not have a relation with anybody working somewhere within KPMG? I think that's almost impossible. That's the first question. More importantly, a real important thing, because I assume it has something to do with the account that him or herself and not really with the company, but anyway, it's news to us. More importantly, Some of these rules are so strict, because I think they're pretty far-fetched, if I'm really honest.
How do you now consider the own remuneration of Non-executive Board members of Pharming? A lot of the people sitting behind the desk right now, where part of your remuneration is in shares of Pharming. It's a topic which at least I've discussed, I've raised several times in the past. It's not a major topic, it's something in Holland we consider to be not perfect governance. We rather prefer Non-executive Directors, certainly if there's no immediate need, to just be paid in cash, pure. If the company is doing well or not, that's it. I know in the U.S., and certainly in biotech, there's a different mentality, but in Holland, you're still a Dutch company.
We prefer Non-executive Board members to be paid with a fixed amount and not have any kind of variable component or bonus component or share component in that a lot as well. Again, considering the kind of very strict and bizarre rule, in my opinion, that applies for somebody working with an auditor, having a relation with somebody working in your company, that this would mean that the person working in your company has to sell his or her shares. How does that more or less compare to the kind of liberal, the kind of American approach of having Non-executive Board members having Pharming shares?
Would you like to take that? Or I assume you have to.
Oh, I'm sorry.
Okay, yeah. I can add it and also.
Yeah. On the second one, we have had this now for a while, and it's a practice that is seen as suitable for the business we're in. We are aware that there's a difference in what the Dutch Corporate Governance Code would prefer, but equally, it's not unheard of. There are others that have it as well, although there are few. Given that we want to be attractive in the market that we operate in, that has been reviewed and has been deemed okay for the last years, and we have seen no need to change that at this point going forward. We recognize the question that you're asking, but it's been considered on a regular basis, and we still find it suitable for the company that we are.
If we go to the first question, and I hope I say this correctly because I'm not an expert in this field, but how I'm aware of this situation, and maybe Deloitte or KPMG can comment if they want to as well. The logic is that for the senior people in your organization, the New York Stock Exchange want to make sure that there's no undue conflict, which I think is very relevant. I believe you're not forced to sell, but you're forced to what you have to hold and then just to not trade. I think that's not unfair. It's done in a way that's very transparent, and I believe it has been a while like that before.
I've come across this situation before, but it's only for the most senior people, and as such, it's not perceived to be unduly unmanageable, and it's for a very specific situation, one of which we have now coincidentally encountered. It's properly resolved within our own organization, also in alignment with our new auditor, and there's no further issue. I don't think it's as insane or as sensitive as you maybe perceived it to be, which I can understand.
I think I used the word on purpose, far-fetched.
Yeah.
There may be a scenario, it's not insane, but it's very extreme. There could be a conflict of interest, or maybe there could be a reason for somebody not checking your books in the most professional, perfect way. That's far-fetched. There can be scenarios invented where this could be the case. I'm comparing especially this kind of extreme interpretation of being clean to your much more American style. Why not granting the non-executive board members who've got a very important role.
We, SVB, really believe in the importance of your role as non-executives, because most shareholders only look at the executives. No, we believe that your role is essential, like the role of an auditor is essential as well. Therefore, we've always pleaded to make sure that these kind of parties, whether it's an auditor or a supervisory board member, a non-executive, that they've got their hands free. There is no potential conflict of interest. Whether you're critical towards an executive, whether you've got comments which people do not like, it doesn't impact your remuneration at all.
If you're saying something is going wrong and we need to take action right now, whether that pushes the share price up or down, you do whatever you think is necessary for the company for the long run. I was just wondering how you compare these two kind of different mentalities. That's exactly the question. You're saying, "Well, we're happy with what we're doing," but you do recognize that there's different level of being clear and clean.
Well, I think it's just different perspectives from different countries. That applies to both questions that you asked. Since that we are a company operating in those both countries, we have to balance these things, and we do that to the best of our abilities, making sure that we really appreciate the culture and the logic in both countries, and then make a decision.
Okay. Thank you.
Yeah.
Any other question? Any other questions? Yes.
Good afternoon. Chris van den Berg. Earlier on, you showed us your liquidity profile is quite strong and growing. If you look at your risk and control framework, how do you manage that? That's an increasing position that from a materiality perspective, requires increasing attention as well from the Board. Thinking of the example of, what was it? Silicon Valley Bank, for example.
I'm going to answer on behalf of Sonny, the audit committee. We do have audit committee that meets with [Sonny], Kenneth, our CFO, and the entire finance team, and Fabrice, our CEO, very regularly. The audit committee is populated with really experts in the field. In other words, they understand controls and finance. You will hear actually a bit more about the reports. We are paying close attention, obviously, to materiality of things and our constant communications with our senior leadership as a Board.
Well, maybe to add to that, the fact that we're now SOX compliant-
Yeah
...that's a very strict bar, also gives us comfort. We really dive into those controls. We understand them, we discuss them in the Audit Committee, we have a close look at them. Then we also ask our external auditor to be supporting us in that journey, but also challenging us and giving us the right questions and guidance. I feel very comfortable that we're in a very professional space there.
Okay. Appreciate it.
Yeah. Thank you.
Any other questions? We will now proceed to the next agenda item, the financial statements of 2025 as included in Item 2E. The financial statements can be found in our annual report from page 123 and onwards. The financial statements were audited by our external auditor, Deloitte Accountants B.V., in accordance with the assignment given by your general meeting on June 11, 2025. Deloitte has issued an unqualified auditor's report for the financial statements of 2025 that can be found on pages 188 up to and including page 195 of the annual report. I would like to invite Ms. Louise Zwama, a partner at Deloitte, to present the highlights and main findings that followed from the audit by Deloitte. Louise?
Good afternoon, shareholders and board of directors. My name is Louise Zwama, and I'm an audit partner at Deloitte. I'm responsible for the audits of the consolidated financial statements of Pharming. I would like to thank you for the opportunity to present the results of our work. Today, I will walk you through the key aspects of our 2025 audit, which we completed and reported on April 1st of this year. My presentation will first provide you a summary of our overall audit findings. Then I will touch upon the key audit matter regarding the valuation of KL1333 license. Lastly, I will discuss the fraud risk we identified and how we addressed them in the audit. We have issued an unqualified auditor's report signed on April 1st, 2026.
This means that in our professional opinion, Pharming Group financial statements and management reports comply with all the applicable requirements of Part 9, Book 2 of Dutch Civil Code and Dutch Standard 720. In other words, the financial statements present a fair and accurate picture of the company's financial position and performance. As a reminder, the management report included the remuneration report and the risk management statement or the VOR, which was a new requirement for listed companies in 2025.
As the company is also listed on the Nasdaq, we issued on the same date an unqualified opinion to the annual report on Form 20-F and issued an unqualified opinion in relation to internal controls on financial reporting. As you might remember, in prior years, the company reported material weaknesses on corporate income tax and accounting for complex non-routine transactions. These material weaknesses have been remediated during 2025, which enabled us to issue an unqualified opinion on internal control over financial reporting for the year 2025.
The remediation activities are described on page 65 of the annual report. During the audit, we identified one key audit matter and three fraud risks, which I will discuss in more detail on the next slides. Our audit covered full scope of significant entities within the Pharming Group. This comprehensive approach resulted in audit coverage of 98% of revenues and 89% of total assets. We established the materiality for 2025 audit at $4.8 million, which represents an increase from the $3.8 million in 2024. Therefore, the benchmark we used was revenue, and the increase in materiality also reflects the, or is representative for the growth in revenue.
We reported all identified misstatements exceeding $242,000, taking into account both qualitative but also quantitative considerations. This threshold ensures that any matters of significance are brought to the attention of the Board of Directors. Throughout the year, we maintained regular and open communication with the board of directors and the audit committee. We had several meetings and calls to discuss our audit plan, progress of the audit, significant findings, and also our year-end report.
This ongoing dialogue ensures that the governance bodies were fully informed of the progress of our work and any matters requiring their attention. Let me turn to our key audit matter, the valuation of KL1333 license on napazimone acquired in a business combination. This matter was identified as a key audit matter because the valuation of this intangible asset involves significant management judgment and assumptions.
The initial fair value measurement, which was measured using a probability-adjusted discounted cash flow approach, and this required significant judgment. Those judgments and assumptions were long-term revenue forecasts, development timelines, and commercialization prospects, which also includes the probability of regulatory success and expected timing of obtaining regulatory approvals, and the discount rates that was applied to future cash flows. Let me walk you through some specific procedures we performed.
We obtained an understanding of our management process of valuation and also tested the operating effectiveness of controls over the valuation. We did engage fair value specialists to assist us in testing the appropriateness of the company's valuation model, the valuation method applied, the valuation date, and key assumptions that were embedded in the model. We assessed management's estimates of probability and timing of achieving the necessary regulatory approvals, we also tested the appropriateness of management long-term revenue forecasts by comparing these assumptions to underlying source data, market information, and internal clinical information about the progress of the drug development.
We evaluated the company's historical accuracy in estimating forecasted performance of the drugs in development. Lastly, we evaluate the reasonableness of the valuation methodology itself and the discount rate applied. We assess whether the methodology is consistent with industry practice, and whether the discount rate applied reflects the risk which are inherent in the asset. Our procedures did not result in any reportable matters. Finally, I want to address the fraud risk we identified and the procedures we performed to address them.
We identified three fraud risks that required particular attention. One is management's override of controls, which is a presumed risk. A presumed fraud risk of revenue recognition, and then we also identified a significant fraud risk related to illegal interactions with patient organizations and healthcare providers. This is a fraud risk that we typically see in this industry. What procedures did we perform on the presumed risk of management override of controls? Again, we obtained an understanding on how journal entries are prepared and recorded, but also tested the relevant controls.
We tested the appropriateness of the journal entries recorded, and also identified and obtained an understanding of the business rationale for significant or unusual transactions that are outside the normal course of business. Lastly, we evaluated whether our judgments and decisions made by management in making the accounting estimates included in the annual accounts indicate a possibility of bias. Our procedures did not result in any reportable matters.
In terms of the presumed significant fraud risk of revenue, we obtained an understanding of management process for revenue recognition, including IFRS 15 implications, and tested the effectiveness of controls. We also performed detailed testing on the manual journal entries and revenue by obtaining underlying documentation and assessed the business rationale to verify occurrence.
Our procedures did not result in any reportable matters. In terms of the significant fraud risk related to illegal interactions with patient organizations and healthcare providers, we obtained an understanding of management business process related to contract management and approval of new vendors, and tested the relevant controls. We performed third-party payment analysis, among others, inspecting donation agreements, reviewed public sources, and searched FCPA enforcement publications for adverse actions or reputational concerns related to those vendors.
Lastly, selected individual transactions for testing and obtained supporting evidence. Our procedures did not result in any reportable matters. In conclusion, the consolidated and company financial statements give a true and fair view of the financial position of Pharming, which is reflected in our unqualified opinion. Our opinion can be found in the annual report on pages 188 up until 195.
Before I close, I would also like to thank the Board of Directors, management team, and particularly the CFO and his team for the collaboration throughout the audit. Their openness, responsiveness, and also professionalism, made our work effective and efficient. The quality of our working relationship reflects the strength of Pharming's control environment and commitment to reliable financial reporting. Thank you for your attention. I am happy to answer any questions you might have.
Thank you, Louise. Please stay at the podium in case there are any questions. I will ask you, of course, to answer questions on the Deloitte's report, but also will ask Kenneth, who can address questions on our financial statements. Are there any shareholders in this room who would like to ask questions on this agenda item, please?
My name is Keyner. I speak on behalf of SVB. When I go to meetings like this, I like to prepare myself, try to understand the business model of a company. As an investor, I want to know how a company earns its money, the kind of growth prospects, but certainly, I'm looking primarily first on the financing. As far as that is concerned, your risk profile is very low since you've got a net cash position. Second question is, what are you going to do with the cash? You've got a cash cow, then we can relax and your risk profile drops even further. That was the reason for my key question in the beginning. There's one element, and these are very obvious questions, and they're very easy to interpret.
I still assume that people give honest answers. That's easy for the person asking the questions. More difficult to make sure you've got a good business model and so on. That's your problem. That's what you're paid for. There's one element where it's much more difficult on this side of the room to get a good grasp on, and this concerns indeed the internal controls mechanism. That's not just a number I have to look into. I have to trust, indeed, the judgment of the auditor. I have to trust the stories being told by the audit committee and certainly by the CFO and the CEO. Last year, we had an extensive discussion about that, and you were honest to say, "Well, there is an issue.
There has been an issue for a couple of years, but we're very close in resolving it. It was a minor thing." Just didn't make it, but next year very soon we'll solve it. I'm happy, and congratulations that you got it solved. The culprit seemed to have been, that was at least the answer I've been given, and that's also just confirmed by the auditor, was Sarbanes-Oxley and the listing on the Nasdaq. The auditor, and it's also written in your annual report on one page, it concerned also the accounting of complex non-routine transactions. The one question I'm having to the auditor, but also maybe to the audit committee, can I assume that complex non-routine transactions are U.S. only?
Kenneth?
Yeah.
Would you like to answer that question?
First of all, I want to say as a CFO that I've been in the company for eight months, I can only echo that the company, in terms of being compliant with the Sarbanes-Oxley, has been close, and it was very close last year, but it was called out where there were some deltas. The company has continued, like in many other areas, to really learn from that, and throughout 2025, with the ongoing regular testing of all the controls we have in place, have continued to make progress and been very sort of focused, and done a great job in that. In terms of the complexity, Louise referred to a matter that related to an acquisition in Europe, so not a U.S. matter per se.
Of course, it involves also the complexity around how you account for things under different, let's say, accounting policies and regulations that are required. We have, over the last 6- 12 months, built also increased capabilities in the company to be able to deal with that. We're not just in the need of seeking external advice when things like that are coming up. The evolution also on that front, both in terms of improving and strengthening controls and building in-house capabilities, is at a different level today than, for instance, a year ago.
At least as a CFO, I'm quite confident with the strong internal controls that we have in place, but also the capabilities we have in the company to deal with the complexity of the matters we are dealing with, let's say, from top to bottom in our P&L and cash flow statements, et c. We are in a good place.
Yeah. I'm happy with the progress and that you feel confident about it. At least my understanding last year was that if you wouldn't have been listed on the Nasdaq, you wouldn't have had to deal with Sarbanes-Oxley, and therefore, there wouldn't have been any, well, at least not a serious or potential control mechanism where you would have offended against any rule. That was at least my interpretation of your answers in this very long discussion. Was my interpretation or my understanding a wrong one?
The way I would like to reply to that is the controls we have in place are ensuring that we are delivering a trustworthy financial reporting. Yes, we are having some formal requirements that we label as SOX because we are listed on Nasdaq. As a CFO, I would like to have the same controls in place even if we were not.
Yeah.
It's about the internal controls that are guaranteeing.
I can only concur with you. That was exactly the reason why I was asking last year. The underlying question I had last year was, is this just some kind of bureaucracy by the way? Or just some rule out of the U.S.? We are listed in the U.S., we have to comply there as well. There's nothing serious in there. It's just that if it wouldn't have been on the Nasdaq, there wouldn't been, certainly not a serious issue.
But if-
I understand, even if you would not have been on the Nasdaq, you should have moved up the level of your internal control mechanism. It's not related to Sarbanes-Oxley necessarily.
I think that, let me sophisticate the answer I gave before a little bit. When it was specific to last year, there were specific areas, a small number of the total internal controls we have in place that we didn't succeed with. In that respect, you could say they were not devastating from a financial reporting point of view, but they were not making us qualifying under the SOX audit and the SOX passing, the SOX requirements.
If you're lifting it to a broader picture, not just thinking about last year, but the many internal controls we're having in place, that control environment has to be there in any company, and we continue to evolve that, and we're super happy with the progress made over the last 12 months. I think it's just a nuance between referring to the exact situation around SOX last year and then just internal controls in general.
Yeah. The key question that I would like to ask to the auditor as well, was Sarbanes-Oxley the scapegoat in reality, or were there more things and this should have been an internal control mechanism issue to be addressed anyway, regardless of Sarbanes-Oxley?
I tend to agree what Kenneth is saying, that you should have internal control mechanisms in place. I think SOX 404 ensures that you also have the auditor provide attestation to internal controls. Nevertheless, the management and the board of directors should have mechanisms in place to ensure reliable financial reporting.
Actually we should be happy with Sarbanes-Oxley?
Yes.
Thank you very much.
Any other questions? Great. Thank you very much. We will now proceed with the voting on the financial statements. Our shareholders are proposed to adopt the financial statements for the financial year 2025. Once I have opened the voting on this agenda item, the shareholders in these meeting rooms are invited to press four if you wish to vote in favor of the proposal, to press against if you wish to vote against the proposal, and of course, to press abstain if you do not wish to vote. As a reminder, those votes will not then be included when determining the voting results. I will now open the voting. Please cast your votes.
I will now close the voting. The voting result, including the votes received by means of proxy, will be shown on the screen in a few seconds. I'm pleased to report that the proposal has been adopted by our shareholders with a 99.95% majority. Thank you very much. The financial statements for the financial year 2025 have been adopted. On behalf of the entire Board of Directors, I would like to thank our management and all of the employees of Pharming for their dedication, and congratulate them on the results achieved over the year 2025.
The next topic on the agenda item is agenda Item 2F, the proposal to discharge the members of the Board of Directors for the exercise of their duties during the financial year 2025, as far as this is reflected in the annual report, in other public disclosures, or in statements made during this general meeting. As a result, the members of the board of directors shall be released from potential legal actions or claims by the company based on their actions while in office. The proposed discharge, of course, also extends to Sijmen de Vries for the exercise of his duties as executive director and CEO during the financial year 2025, up to his resignation as CEO on March 4th, 2025.
I would like to invite our shareholders to ask their questions on this agenda item. Please go to one of the microphones if you have any questions. I don't see anyone asking questions. We'll now proceed with the voting on this agenda item. Our shareholders are proposed to discharge the members of the Board of Directors and therefore to release them from liability for the exercise of their duties throughout the year 2025. I will now open the voting and invite our shareholders in this meeting room to cast their votes.
Please go ahead and vote. I will now close the voting. The voting result will be shown on the screen in a few seconds. I'm pleased to confirm that the proposal to discharge the members of the Board of Directors has been adopted by our shareholders with a 98.19% majority. We will now proceed to the third item on the agenda, the appointment of KPMG as our new auditor. I would like to ask Mark Pykett as member of the Audit Committee to introduce this agenda item. Mark?
Thank you, Richard. It's my pleasure to stand in for Leon today for this agenda item. As announced during last year's AGM, the audit committee conducted a comprehensive evaluation and selection process to identify and nominate the external auditor best suited to support Pharming's growth in the next phase from 2026 onward. Deloitte has served as our external auditor for seven years, and we are grateful for their efforts and guidance over that period.
There have been no concerns whatsoever regarding Deloitte's performance, as evidenced by the fact that Deloitte was also invited to participate in the proposal process. During the search, the audit committee specifically assessed the selected audit firms based on their experience in auditing biotech companies with multiple listings, including Euronext and Nasdaq, their senior-level U.S. SOX expertise, and their ICFR audit strategy-related experience, among other things. Based on the criteria, KPMG scored best and therefore was selected as the preferred firm for appointment as external auditor beginning with the 2026 financial year. Richard?
Thank you, Mark. On behalf of the entire board of directors, I would like to thank Louise Zwama, and through her, the entire Deloitte team, for the valuable and highly constructive way that they have performed their role as our auditor over the past seven years. Thank you so much. I will now invite our shareholders to ask questions on the nomination of KPMG as our new external auditor. Bas [Geerling], the designated lead partner of KPMG for the audit of Pharming, is present today and available to answer questions from our shareholders. Are there any questions?
As I do not see any questions in the room, I will now propose that we move on to the voting on this agenda item. Let me see the agenda on the other hand. Yep. As further explained in the explanatory note to the agenda for today's meeting, the board proposed to appoint KPMG as external auditor for the financial years 2026, 2027, and 2028, and to mandate KPMG, amongst others, to audit the annual report and financial statements for each of these years. I'm now opening the voting on the proposal to appoint KPMG.
Please go ahead and vote. I will now close the voting. The voting result will be shown on the screen in a few seconds. I'm pleased to confirm that the proposal has been adopted by our shareholders with a 99.95% majority. Under the next agenda, Item 4, we present the proposals to our shareholders to amend the current remuneration policy for the Board of Directors regarding the compensation that is paid to the Non-executive Directors. I would like to ask Jabine van der Meijs as member of the Remuneration Committee to introduce this agenda item. Jabine?
Thank you, Richard. As explained in the explanatory notes, the fees paid to the Non-executive Directors for their membership of the Board of Directors, they have not changed since 2020. For the Chair of the Board of Directors, only the cash component was increased upon appointment in 2023. The fees for the chairs and members of the committees were increased for the last time in 2024. As a result, the current fees do not reflect significant inflation and market changes in recent years.
The Remuneration Committee also considered Pharming's significant growth over past years and the important developments in its product portfolio and pipeline. For the Non-executive Directors, this resulted in increasing activities and enhanced tasks and responsibilities. The committee engaged Aon as a leading external reward agency to conduct a benchmark of the fees paid to the Non-executive Directors.
As summarized in the explanatory notes, the existing annual equity value was found by Aon to be positioned below the market's 25 percentile, while the total direct compensation approximating the 25th percentile. To remain competitive, and also in attracting and retaining the required non-executive expertise, and to compensate for annual inflation increases, we propose to our shareholders to increase the annual fee in unrestricted shares as set out in the remuneration policy and as of this financial year. For the chair, by EUR 20,000 to the equivalent of EUR 60,000, and for the other non-executives, by EUR 15,000 to the equivalent of EUR 45,000.
The second proposed amendment to the remuneration policy is to facilitate an annual increase of the fees paid to the Non-executive Directors in accordance with the official annual Dutch Consumer Price Index increase. For the cash fees, that change is proposed to be effective from this 2026 financial year onwards. For the fees in shares, the inflation increase will become effective from the next year, so the 2027 financial year. In accordance with the Dutch Civil Code, the resolutions each require a majority of 75% of the votes cast. Before inviting you to ask questions, I would like to ask the Chair of the Works Council, Mr. Tyron Jermin , to share with you the opinion of the Works Council regarding the proposals.
Thank you, Jabine. Good afternoon, distinguished shareholder, members of the Board, accepted management, and fellow attendees. My name is Tyron Jermin , and I'm honored to serve as Chair of the Works Council of Pharming Group. It's a privilege to address you today and on behalf of the Council and employees we present across the organization. I would also like to recognize and introduce my fellow Works Council members, appointed in March of this year, whose professionalism, expertise, dedication contribute significantly to the work of the Council.
As opposed to the first sheet, we've seen the following of Pharming Group's significant growth. The Dutch Works Council was established in 2022. In order to strengthen the employee representation within the company's governance structure. Operating under the Dutch Works Council Act, we as a Dutch Works Council represent employee interests on organizational, operational, financial, and social matters.
Depending on the subject matter, we exercise a right in relation to information, consultation, advice, and consent, thereby contributing to a balanced decision-making, transparency, and sound corporate governance within Pharming. Next sheet. Yes. The essence of the request from the proposal was the adjustment of the remuneration policy per January 1st, 2026. Also it was to increase the annual remuneration cash shares for Non-executive Directors as board members and committee chair members.
Also the application of the CPI indication in cash from the financial year 2026, and the shares financial year 2027. The rationale is that the remuneration levels remain largely unchanged since 2020, whilst Pharming's complexity, international scope, and Board representation have increased. Our comments as a Dutch Works Council is that we found the proposed adjustments are supported by external benchmark data.
While assessment is solely based on the input from a single external party, in this case, Aon, the proposed remuneration position remains generally within or below the relevant market benchmark ranges as outlined in the supporting documentation. Our position as a works council is that we have no objection to propose amendments to the remuneration policy.
For the future expectations is that the developments remain balanced, transparent, and aligned with governance principles and stakeholders' expectations for a Dutch-listed pharmaceutical company. We appreciate the continued engagement and support of our stakeholders, and look forward to contributing positively to Pharming's future. Thank you.
Thank you, Tyron. I propose that we now answer the questions that our shareholders may have. Any questions? Okay.
Keyner, on behalf of SVB. If you look at the total compensation in this proposal for the Non-executive Directors, you're talking about including the shares, the shares that are granted, EUR 150,000 per year for the chairman and EUR 90,000 for the other Non-executive Directors. Of course, you also got the committee fees. Actually, it's much bigger. It's not a scandal, it's not outrageous. It did surprise me when I first read it's below the 25 percentile of your peer groups, since I do follow lots of Dutch companies, at least on the Euronext.
Most of the companies actually are much bigger. A big portion of those are much more complex than your company. I was wondering, to what degree was there maybe. This is very negative. Maybe I should be critical right now. Maybe there was some kind of cherry-picking in selecting the peer groups to make sure you support your argument, well, there should be a little bit more. Actually, I do recognize the role of a chairman in a single-tier board.
That's different compared to what you mostly find in the Netherlands. I understand that this role actually, is an Executive Chairman almost. That's really different than doing this one day a week. It's more intensive than that. That's my first question. To what degree has there been some kind of cherry-picking to make sure that the outcome of Aon is a positive one? The second thing is more practical one.
Is it really true that supervising or advising a company in this phase, where Pharming is in right now, is more complicated or more time or labor-intensive than it was five years or 10 years ago? I dare to say it's not. Since you got much more room to maneuver, the risk profile of the company has decreased a lot. Maybe it's time to really reduce the kind of remuneration of the non-executive, because your role has become much easier. I would appreciate your response on these two kind of critical questions.
I am very happy to kick it off and then for the colleagues to answer. On the first bit, I can understand your logic. You have to remind yourself of two things. One is we are not a two-tier Board, we are a one-tier board, our accountability, and therefore, we are much deeper involved than what you see in a two-tier board, and I am very familiar with both.
Secondly, if you look at what you are comparing us with, are non-biotech, far more Dutch-focused companies. This company, as you see around me, has also very much a very strong American footprint, with also American-based biotech non-executives. If you look at the list at Aon is thinking for themselves. We cannot cherry-pick, and it is not like we want this. Aon is a professional company that really will challenge us if we do that.
What we compare ourselves with are biotechs, both in Europe and in the U.S., and have a look at what that looks like. If you then look at the results, we are truly between, even after the increase, between 25% and 50% of the benchmark, and not higher than that. I think that bit is very reasonable, and you have to benchmark your remuneration with comparable companies, not with location. Not only with AEX, I mean. On the second question of has it become more difficult? I've been a full-time non-executive for the last five years with a very different portfolio of companies, and you really see the expectation of society increase. We're now seeing two changes.
We see Pharming becoming really stepping up in its desire to where it want to go. The strategy is really one that's very ambitious. We're very happy that it is that way. As a one-tier board, we're very actively involved. I can speak for myself, having been on this board for five years, that the amount of involvement is stepping up. I'm thinking, we don't increase our flat fee, we only increase our share fees. I don't think it's an unreasonable position if you take all these things into account. I understand the question.
Yeah.
Richard can see if there's other.
I think that's very well answered. I don't think I have anything more to add. I think that's why we put it up to the vote. You can vote against if you want to vote against it. I can tell you, I serve on multiple boards. This board, it requires a lot of activity. The fact that we are a Dutch company, we're listed in Europe, we're listed in the U.S. By far, of all the boards that I serve on. No, of course, I'm the chairman, as you said. As chairman, you get more. Even though with ISS and Glass Lewis, when you serve as a chairman, you can basically count as two board seats.
Right. You're not allowed to have more than five total. Just being a public company, they know that the chairman role is even more intense. Look, we're all doing it because we love it. We love the company, we love our shareholders. There's also a certain level of fairness of like, okay, we want to make sure that people are rewarded for their time. We're still way below the benchmark that Aon has put forward. We didn't want to go to 50%, 50 percentile. If we had done that, you'd have said, "Wow." We're still quite below, but that's okay. We love the company, we love working with the team, we love doing what we're doing for patients, and we're very passionate about the future of the company.
If I'm not mistaken, if you are comparing yourself not to AEX, which most multinationals, by the way, these are not Dutch local companies which only sell to Dutch people. Actually, most of the companies listed on the, at least AEX and AMX, most of their business is outside of the Netherlands and they've got multiple offices, many more than you will probably have for the next five or 10 years. They're not just local companies. I was just wondering, the 25 percentile that you're referring to all the time, is this primarily squeezed, well, because you're including the American companies? If you would just look into Europe, there are plenty of biotech companies here as well, probably would be closer to 50%, I would assume. Maybe I'm wrong. Second and last comment.
I believe that if you are increasing your total remuneration, and I've got more appreciation for the chairman, not because of him as a person, but of the role that you're having in the single-tier board. I think that this would've been an excellent opportunity to move one step closer to the Dutch governance standards, saying, "Okay, we are increasing the total remuneration, but we move to a fixed fee." There's many hours they have to spend, but no shares anymore to make sure that we give the impression, at least to the shareholders worldwide, but certainly the ones who are sitting in this room, we are really independent.
Whether it goes well with the company or not, we are doing our work, and our fee is totally transparent. It's EUR 150,000 for the chairman, EUR 90,000 for the other ones. Additional compensation for if you got committees, which most of you have. That's much cleaner and much closer to the Dutch Corporate Governance Code. You may not like the Corporate Governance Code in Holland, but at least so far, you're a Dutch company.
Yeah, I think I answered that question before, so there's no need to answer it again, I think.
That's good. Thank you.
Are there any other questions? All right. I'm now going to be opening the voting on the first proposal, as set out in the explanatory notes, to adjust the annual fees of the Non-executive Directors in shares as of January 1st, 2026. I will now open the voting. Please go ahead and vote. I will now close the voting. The voting result will be shown on the screen in a few seconds. I'm pleased to confirm that the proposal has been adopted by our shareholders with a 98.9% majority.
Thank you very much. We very much appreciate it. I'm now opening the voting on the second proposal, as also set out in the explanatory notes, for the annual increase of the compensation of the non-executive directors in accordance with the official annual Dutch Consumer Price Index increase. The polls are open. Please go ahead and vote. I will now close the voting. The voting result will be shown on the screen in a few seconds. I'm pleased to confirm that this proposal has also been adopted by our shareholders with a majority of 99.01%.
Again, thank you so much. The next item on the agenda is item number five, the proposed authorization of the board of directors to issue new shares or rights to acquire shares. This proposal covers the designation of the Board of Directors for a period of 18 months, starting today, as the body authorized to issue new shares or the rights to acquire shares. The authorization is limited to 10% of the issued share capital and is intended for general corporate purposes.
This authorization may be used, for example, for Pharming's general financing purposes and includes up to 3% of the issued capital, share issuances under the remuneration policy for our Board members, and the incentive arrangements in place for the CEO. The issuance of stock options or restricted shares under the equity incentive plans for our staff are also covered by this authorization. The Board will also be authorized to limit or exclude the preemptive rights of existing shareholders when issuing shares or rights to acquire shares.
Once approved by our shareholders, the authorization will replace the similar existing authorization for general purposes that was granted on June 11th, 2025. I'm now inviting our shareholders in this room to go to one of the microphones to ask their questions. Since there are no questions, we will now move on to voting on the proposal presented under agenda Item 5.
This proposal entails the authorization of the Board of Directors to issue shares up to 10% of the issued capital for general purposes, such as financing. I'm now opening the voting and invite our shareholders in this meeting room to cast their votes on this proposal, which is described in more detail in the explanatory notes to the agenda. The polls are open. I will now close the voting. The voting result will be shown on the screen in a few seconds. I'm pleased to confirm that the proposal has been adopted by our shareholders with a 98.03% majority. The next item on the agenda is agenda item number six.
This item relates to the proposed designation of the Board of Directors for a period of 18 months, starting as of today, as the corporate body authorized to repurchase fully paid-up shares in Pharming's own capital, up to 10% of the issued capital. I kindly refer you to the details in the explanatory notes to the agenda for today's meeting. The proposed designation will replace the current authorization as granted by general meeting on June 11, 2025. I would like to invite our shareholders to ask their questions.
Are there any questions on this agenda item? Since I do not see any questions, we will now move on the final voting round for today's general meeting. I'm opening the voting and invite our shareholders in this meeting room to cast their votes on the proposed authorization of the board of directors to repurchase up to 10% of the issued capital. The polls are open. I'm now closing the voting.
The voting result will be shown on the screen in a few seconds. I'm pleased to confirm that the proposal has been adopted by our shareholders with a 99.65% majority. The final agenda item number seven is any other business. Under this agenda item, we will address the questions that are of a more generic nature. Please go to one of the microphones if you have any questions. Yes, please go ahead.
Yeah. Keanan on behalf of SVB. Before I ask my last critical question for today, let me at least make sure I'm positive about your company.
We know.
interesting company, and it's, I think, the 23rd year I'm visiting the AGM. So despite all my critical questions, I'm positive about the company. Last critical question, I think, I hope, and I do hope you do take this seriously as well. A number of times today, you as a board have been indicating, well, the Q1 results and the development of [Glucyonance] sales, the revenue, that was more or less announced, should have been expected.
This was Q1 normal seasonality, and we will recover the rest of the year, there will be some kind of growth. The market was surprised. The share price indicated, well, it was, I think, 20% drop because of the Q1 results. One of the shareholders said, "Well, maybe the short sellers have been manipulating the price." They can manipulate it somehow, but not like 20% drop with 1% or 2% extra shorts. That's not possible. I'm sure you must have evaluated this kind of reaction of the market, and there must be some learnings out of that. Probably the way you're communicating to the market, the way you're presenting your results. What are the learnings from that? Because the market was surprised, despite that you said it should have been expected.
Fabrice, since you interact a lot-
Absolutely.
...investors, why don't you go ahead?
It's fair to say that some shareholders were surprised, but at the same time, some shareholders were absolutely not surprised. Clearly there were two categories of shareholders as I've been interacted with since we disclosed our Q1 earnings. I think there is also a sentiment among the broader shareholder community to understand how the HAE market is going to evolve, and that is magnifying the fluctuation, obviously, of the share price. I think this is something also we need to understand.
There's been three drugs launched in this market over the past nine months, and a number of shareholders are asking themselves, how is this market going to evolve? Which are going to be the winners, the losers, the drug that will maintain the market shares? It's about putting the magnifying glasses on every piece of communication, and that obviously increase the level of volatility.
I expect that volatility to remain, as I said, for a few months, possibility a few quarters, as the market settle. It is something that I've seen in other markets, and again, I will state my conviction about the long-term prospect for RUCONEST, that it will remain a durable cash engine for the company and a cornerstone treatment for a subcategory of patients. As the market digest new entrants and also some future new entrants, there will be more volatility. Yes.
You're a person who looks at the matter, fundamentals. I'll talk about communication. If your share price drops by 20%, at the same time when you indicate there's no real news here, what is happening here? There must be something wrong. Unless there's a nuclear war happening at the same time, which was not the case, on the same day that we come up with the Q1 results, two of your competitors come with a total new treatment, which is very promising, and may take away some market share away from RUCONEST.
That was not the case. I was hoping at least there was some learning in the way we communicate with large shareholders, especially, and to make sure that this kind of news is interpreted in the right way. Maybe we were too positive, your communication was too positive in the past, and in the end the market was surprised. Gee, this is it. There must be something wrong. There must be miscommunication between the shareholder group as a total and you as a company. I hope there is some kind of learning. Otherwise, these kind of things may happen in the future. This doesn't help structurally the share price either, if there is such volatility based on no fundamental change.
Obviously, we were not happy to see that fluctuation, we will strive to do a better job going forward. If you recall, during our Q4 2024 and full year earnings results, we had indicated that we would expect between 7% and 9% impact, driven by de-stocking at a specialty pharmacy level. This came at 8%. We were right in that range. Perhaps it has not been said enough or clearly, we'll take the learning and ensure that this doesn't happen.
Thank you.
As I said, there will be volatility in a market where there are lots of new entrants.
Thanks. Are there any other questions for the general topics? Yes.
Yes. Joris van der Louw-
Yes.
...Private shareholder. I have two questions. One is on in-licensing. Looking at development of Pharming, I've been following the company since 2011 when I became a shareholder. I've seen many pipeline sheets over the last few years. I'm wondering the business development. Looking at the development of the pipeline, there's always more time needed, huh, in the pipeline. That's understandable in this complex business. Why is Pharming not in-licensing one or two products every year? We see now Joenja, the growth is coming, but a bit slowing down, some postponements in the pipeline. Will the company become more aggressive to have a fuller pipeline to be more robust in future?
Thank you so much for your question. I think what you're saying is really at the core of our strategy, which is to make Pharming a leading global rare disease company. We clearly intend to continue to expand our pipeline, to de-risk it, and obviously consolidate our strategic position in the rare disease market. We are, at any point in time, evaluating different options. I have actually, after this meeting, a meeting with members of the Pharming teams to review an option. It is about ensuring that we acquire high-quality assets at the right price. We're looking at the quality as well as the price. Ultimately, the acquisition will be value accretive for our shareholders.
I must say, I've been very impressed since I've been in the organization to see the level of capabilities that we have developed at Pharming in terms of identifying potential acquisition opportunities, following them for months, sometimes years, to ensure that they are of high quality, engaging, when possible, with the prospects, and build a certain relationship so we can acquire the asset. It is happening, and we will keep you closely posted. It is at the core of our strategy.
There was a question earlier or comment earlier about how busy we are or not busy we are as a board. I can assure you, one of the reasons we're so busy is that we're looking at a lot of things. In business development, you say no many times because you find problems with an asset. We've got the chair of our transaction committee here, Barbara Yanni, she can even expand on that.
We look at a lot of things that management brings to us, sometimes we basically collectively decide no because we find that it's not as great as we thought originally based on due diligence, or we can't agree on the terms. We wouldn't want to acquire something just for the sake of acquiring something. I don't think that you as shareholders would be happy if we overpay. We're being very thoughtful. Let me assure you, this is a very active part of the organization. Barbara, do you want to add anything?
No, I think the points have been covered. It is hard to find I used to be head of the licensing department at Merck, and we didn't do many deals then either, and we had a lot more money. It is very hard. It is a tough business. You have to balance the risk and the reward. We're a pretty small company, but we look constantly and we're ready to jump if we see something that's worthwhile. We just have to be very careful about balancing the price against the risk.
Very nice to hear that. I hope it's in the tens of millions instead of the hundreds of millions, looking at the size of Pharming. If it's in the tens of millions, you could do one or two every year. That would be interesting. Another point I have is, as a person, I can give attention to one thing, so to say. How does Pharming spend the time with all the setbacks in the pipeline? Do you have a special team focusing on the improvements on the pipeline research or processes with the several setbacks you have over the years?
Taking the learning on everything we do is absolutely paramount, specifically when you are a high-growth biotechnology company. As I referred to in my speech, we're coming a long way. The company has developed extremely well over the past decade. We are on a journey, learning from what we've done is absolutely essential. When it comes to learning in our interaction with regulators, learning when it comes to the way we execute trials, learning when it comes to the way we execute our commercial strategies. These are part actually of the culture, actually, of what a company like Pharming should strive for.
Okay. Thank you.
Any other questions? General matters? Great. Well, first of all, I want to thank everyone for their very thoughtful questions and your engagement that makes this meeting even more productive, so thank you very much for that. I am now closing this meeting, and thank you all for your attendance today. I would like now to invite all of our shareholders who are present in this room to join us for drinks in the foyer right next door. We very much look forward to meeting all of you again soon during one of our webinars or one of our many planned corporate events. Thank you so much.