Okay. Hi, everyone. I'm Gary Nachman, the biopharma biotech analyst at Raymond James, and we're very excited to have Adam Grossman, CEO and founder of ADMA, and Brad Tade, CFO of ADMA, with us. ADMA is focused on specialty plasma-derived products with two key immunoglobulin, or IVIG, products, Asceniv and Bivigam. The product mix has been shifting more to Asceniv, which is a higher value, higher margin product used for more severe patients that have immunodeficiencies. This is a great growth story, with numbers that just continue to get better, and they just reported Monday after the close as part of our conference, so thank you for that, and posted good results and raised guidance, so it's great to have you back here, Adam, and to have you here as well, Brad, to talk through the ADMA story, and thank you guys for coming.
Thanks, Gary, very much. Thank you for all you do for us. Thanks to the bank for its continued support over the years. We appreciate being here.
Excellent. So since this is a generalist audience, people may not be as familiar with ADMA, although they got to know you definitely a bit last year and over the last year. Just spend a few minutes describing what you guys do, because it is a little bit of a unique business, the process of collecting plasma, what goes into manufacturing your finished IVIG products, and for what types of patients both Asceniv and Bivigam are currently being used in treating immunodeficiencies.
Sure. So we make specialty plasma-derived biologics, as I like to say to a generalist audience. We take plasma from generous donors who come into one of our centers or one of our third-party centers to donate their plasma. And then we separate it and extract all of the antibodies. So we like to say that we make a healthy immune system in a bottle. The process takes about seven to 12 months from the collection of plasma and all the testing through the actual fractionation process, which is where the plasma is separated and then purification through fill-finish label packaging and final lot release testing. Every batch of drug that we test, we send samples to the FDA, and every batch is released by the FDA. And that whole process, again, from start to finish, takes on average about seven to 12 months. It's a labor of love.
We've got 700 employees that contribute to everything that we do here. And again, our company is slightly differentiated. So the industry that we're in, there are really six, seven large players that make up a $12.5 billion US immunoglobulin market. Our manufacturing footprint, our plant can process approximately 500,000 liters of plasma per year. Roughly, that would provide about 2 million grams of IG. About 100 million-120 million grams of IG are sold and infused every year in the United States. So we like to think we have about a 2% share from a unit perspective. What differentiates ADMA is that we have intellectual property around how we test and identify plasma donors that have a unique antibody profile. RSV is the virus for which we are using to detect high levels of neutralizing antibodies in people's plasma.
The hit rates are somewhere between 5% and 10% of the population have the antibody titers that we're looking for. We use this high-titer plasma to manufacture our unique IG called Asceniv. This is the first of its kind. Prior to ADMA launching Asceniv about five years ago, it's pretty much a one-size-fits-all category. Every manufacturer in our space, large and small, sell 100% of what they produce every year. IG runs a little bit of a tightness of supply. There's more demand than the ability of the entire manufacturing universe to produce. What we do is differentiated because we are only using this high-titer plasma to make Asceniv. It's the first of its kind. It's manufactured in a highly standardized way. We like to say that we have a unique antibody profile.
We've positioned the product accordingly in that we target the most complex, as you said in your opening remarks, the most complex, highly refractory, comorbid patients that are receiving IG therapy. But the way I like to describe it is these patients are surviving. They're not thriving. And Asceniv, what we've seen in the real-world setting, is that it is taking patients that have had their doses increased. They have increased the frequency of dosing. And they have not really improved. But what we're seeing from a real-world benefit perspective is these patients are getting their lives back. The real-world improvements, getting these people back to work, school, active members of our community has been dramatic. And look, we've got a great staff. We've got a great commercial organization, great manufacturing scientific team.
But really, Gary, and I think I said this last year at the conference, the growth and the success of our business is really because we make a good drug that helps people.
Okay. That was a great overview, including on the market. So thank you. As I mentioned, you guys reported four key results that were solid. You raised your guidance for 2025 and 2026. Yet the stock had sold off initially on some concerns. And then since then, it's rebounded nicely. So from what we've been hearing from getting a lot of questions, one of the main concerns was that the 10-K filing was delayed because you guys have a new auditor, KPMG. That has to be completed, that process. They're doing a lot of testing of controls. Understandable. But I think people want to check that box. So just discuss your confidence that we won't be getting any sort of restatements with the financials when you actually file, which should be on or before March 18th. Okay.
That's correct. And as you know, we issued financials on Friday. We would not have issued financials if we didn't have extreme confidence in the accuracy and integrity of our financials. Really, the delay in the 10-K was specifically due to the short runway that we had from offboarding CohnReznick and onboarding KPMG. They are largely done with the audit. They have some final controls that they're going through and auditing. But like I said, at this point, as we sit here today, there's no disagreements with KPMG. There's no significant deficiencies. There's no material weaknesses. We will file on or before March 18th. And like I said, we have the highest level of confidence in the integrity and accuracy of our financials.
Okay. And I mean, just to follow up, and maybe Adam, if you want to add in, but just to explain to people the process to give you comfort in actually reporting results and how you got them to sign off on everything. Otherwise, I mean, you wouldn't have come out with those.
I don't get KPMG to do anything. I'll say that. It's definitely a unique change for us graduating from a smaller audit firm to one of the big four. But what I did want to add is that KPMG has been presenting to our board and our audit committee throughout the audit. And prior to us getting audit committee and board approval to file the press release, I mean, they gave verbal comfort to us on the financials. They've said that the financial audit is substantially complete. We don't anticipate, they don't anticipate any changes to the numbers. This was a requirement of my audit committee chairman and my audit committee in order for us to get to a place where we could put out the numbers.
So from a management perspective, I think Brad and I were looking at all the different levers we could pull with respect to this audit. And could we have delayed everything and just filed the 10-K a little late? But we were substantially complete with the financials. And the audit team from KPMG said, "Look, if you want, we can put out the financials. And then you can file this 12b-25, which the SEC has available that provides companies with a 15-day extension period." Look, we're the first company that we can find that has had this unique situation. I mean, it is an outlier. The fact that CohnReznick, who if you haven't seen, they announced a PE firm bought a large portion of their business about a week or two ago. So read into that what you will.
But we're the first company, really, that has had this unique situation from an auditor change perspective. But I think that there's a great working relationship with KPMG. But they provided our board and management with comfort. And to reiterate what Brad said, from my perspective, there has been nothing told to us to date about any significant deficiencies or material weaknesses individually or in the aggregate right now, obviously. And we're being recorded. And I'm here. And things can change, obviously. I have to say that. But as we're here presenting at the conference, we feel really good about this. How fast KPMG finishes, I don't know. A lot of questions are, is it going to come early? I have no idea. But we have a commitment, certainly our team. And hats off to the entire ADMA team. We're working tirelessly to get this finished.
KPMG is doing the same. They're working tirelessly. We thank them for their work. We feel reasonably confident that we will file within the ascribed timeline.
Okay. Great. Let's focus on the business, which has been great. It's been tremendous. So congrats on all the progress and hard work. So I guess the other bit of feedback that we heard from investors was that they've gotten accustomed, I think, to your beats and raises. And you gave good guidance at an investor conference early in the year. And then you just bumped up the guidance just slightly. Yet your commentary is just very bullish and optimistic and talk about a lot of places where there could be upside. So it's the downside, I guess, of having these expectations that are a bit higher. So maybe just talk about what goes into your thinking when you provide your guidance, the level of visibility that you have.
And then let's touch on a few of the upside drivers to that guidance potentially from all the different aspects of the business.
All great questions, and we appreciate it. I mean, look, we've taken the same conservative approach to guidance that we always have. I mean, the way that we formulate our guidance is a conservative approach. To my opening comments about the production cycle, I think that's unique about our business is because it takes us approximately a year to produce a batch of drug, we know how much drug we made last year. We know what's coming off the production line. So it gives us visibility into, okay, we've made more Asceniv last year than the year before. And we're making more Asceniv now than we anticipated. So that gives us confidence in forward-looking opportunity. I'll just say, look, when we were at the conference that we're obviously not going to name earlier this year in San Francisco, it was a calendar flip.
I always get nervous on the calendar flip. Why? Because you never know what the new year brings. So we try to take a conservative approach. We are committed to delivering continued top line, bottom line, margin expansion. That's what our commitment is. So we look at it as we're giving very, very strong, reasonable guidance. We don't want to go ahead of our skis here. The demand trends into the end of the year were outstanding, which gave us confidence to raise guidance in San Francisco. It's 45 days, 55 days since that conference. And the demand pull-through has been dramatic. And it's growing at an increasing rate.
Our ability to collect plasma: one thing that we did announce in early January was the onboarding of plasma supply contracts, extending the contract that we had in place already with Grifols, extending that for another 10 years to about 150 of their collection centers. We really take our hat off to them for that contract and then working with a new third party, Kedrion. They've been a great partner onboarding very quickly, but from where we ended the year and the amount of plasma we were getting from our third parties, our testing throughput to where we are, call it 60 days or so later from the end of the year, has improved dramatically. I mean, the numbers that I saw for February on plasma collections, on utilization pull-through, are beyond what our internal forecasts have been.
That gives us the confidence to say, "All right, we're collecting more plasma. We're going to take production slots away from Bivigam to make Asceniv. We're going to make more Asceniv this year." We feel really good about that. And on the demand side, the queue continues to grow. And I think you asked me that question on our conference call Monday. But really, I mean, all the cogs in the movement are working really, really well together. Our third parties are working very, very well with our supply chain team. Our internal RSV testing team is able to process more samples than they were previously. And all of these things working well. I mean, and it's hats off to my leadership at ADMA. I mean, I'm just the mouthpiece here. And I get to walk around feeling very good and proud.
But there's 699 or so other people that are much more valuable than me making this happen.
Okay. That's great. So let's dig into a few of these key components that are potentially going to drive some upside going forward. So first, on the supply contracts, are you comfortable that you have all the necessary agreements in place to get as much of the plasma that you need to manufacture Asceniv given the demand that you're seeing? And obviously, this is something that's going to improve over time. But do you think you're going to need to tap into other sources at another point in time? Because I think people were a little surprised when they heard that you had signed all these additional contracts because they thought that you were in a reasonably good place. So now just give people comfort that you have all the supply agreements that you need and also with your own donor facilities.
No. Absolutely. I mean, look, we were in a reasonably good place, but we want to be in a better place and we want to accelerate it. I mean, the patient queue is real. The way that I've been describing this to investors is we target about 300 immunologists in the U.S. About a third of them have at least one patient on drug. You can imagine there are these 250,000 patients that make up this class of primary immune deficiency that are being seen by these 300 docs, so you can imagine they have large practices. They have problematic patients, so when they start one patient or the second patient, they get good results. They're getting reimbursement. They feel good about this. They want to add patient three, four, and five, so we don't have this wide array of doctors that we have to canvass around the U.S.
It's a pretty insulated group of clinicians who are prescribing the product. So we've got great relationships. We've got a great share of voice with these folks. They want to add more patients. So really, what it comes down to is on the supply standpoint. We had roughly, we say, about 50 centers collecting up until we signed these new contracts. Now we have the ability to access plasma from 250 centers. Something that I have been saying, just part of the Plasmanomics, as I call it, typical plasma center will collect 40,000-50,000 liters of plasma annually at roughly a 5% hit rate. Call it 2,000 liters per center.
So if we have 250,000, excuse me, if we have 250 collection centers, and if they're all collecting at the levels that, say, ADMA's internal collections are at peak, that would give us over half a million liters of plasma annually, which is more than my plant's total production capacity. Now, do I think that we're going to get the same level of plasma from every one of our third parties? No. I don't run those centers. I don't have control. I cannot rule with an iron fist the way that I do internally at ADMA. But these companies are financially incentivized to focus on getting us the plasma that we need. There are bonuses and milestones. And I believe these contracts will be filed with a 10-K as supplements. So that's forthcoming. But we feel really good about the position where we are. And candidly, and look, it's early.
It's early in the year. February was a great month from a plasma collection standpoint. But I feel reasonably confident today that we're going to wind up scaling back some centers that we're collecting from because I don't need so much plasma. Yes, I want to build my inventory. Yes, I want to have a large supply. I mean, are we living a little bit hand-to-mouth? Less so these days than we have been. But as we collect the plasma, when we get enough plasma to produce a batch of Asceniv, we are taking away Bivigam production slots to make Asceniv. For those who are new, the plant doesn't care what it's making. It's the same process whether you're making Bivigam or Asceniv every day. It's essentially the same.
The only difference, all the science, as I'm putting my fingers in quotation marks, comes into the formulation of the plasma pool. We use normal plasma to make Bivigam. We use high-titer plasma to make Asceniv.
And then just remind people, what are some of the things that you can do once you've done all the testing with the donor plasma that comes in, when you've identified a patient that has high RSV titers and they could supply the Asceniv product, and how you go back and are able to tap into that pool, getting more efficient with that over time?
Absolutely. I mean, internally in our 10 vertically integrated centers, we've implemented VIP donor programs. So we provide them with little cards like you would get really at your local coffee shop or favorite ice cream store where they get punch cards and fifth ones free. We lay out very, very easily for our plasma donors how much money they're going to get on each donation. And we're paying substantial premiums to what a normal plasma donor would get for these people to come back and donate twice a week up to eight times per month, which are the FDA regulations. Additionally, we are putting money behind a plasma donor app. So I think later this year, I'm going to have my own app, which is kind of cool.
Who knew we were going to be such an advanced company with our AI system, ADMAl ytics, and now a donor app? But we are implementing and investing money into marketing and donor retention. I mean, that's where all the science is here. Once we spend the money and the effort and the energy in identifying one of these plasma donors, we want to get them to come back because they've got something special. We're all created equal as people. I say that all the time. However, some of us have a better immune system than others. And we've unlocked, if you will, the key to identifying at least through our test a way to identify who are high responders to different infectious diseases.
Okay. You mentioned ADMAlytics. You have Plasmonomics. I love these terms. So ADMAlytics specifically has enabled you to improve your manufacturing yield efficiencies.
It's enabled us to improve efficiencies, manufacturing yield. It is working on health economic outcomes analysis. Really, what I'm so excited about is that we plug in this information and data, and what the system is able to tell us is that if we use a plasma pool for Bivigam or Asceniv that is derived from this many liters from this region, this many liters from that region, we're able to sort of standardize the production yield, if you will, of a lot of plasma. Additionally, we see other areas, and there are other insights that we're currently looking into on things like mixing times and mixing speeds and pump pressures and the amount of time it's taking at different various steps that, well, if we do this for this amount of time, that's within the validated process times.
But if we only do it for this amount of time, we get a better yield. So there are a number of levers that ADMAlytics has been able to offer us to enhance yield and efficiency. But on the commercial side, it's really helping to formulate the call plan that our sales force and our medical affairs team acts on. I mean, we know where patients are being prescribed drug. We know who are new docs in real time as the data comes in from our third-party distributors and customers who we purchase data from. And then you layer that on with outcomes data that we've purchased into the system. It's an unbelievably powerful tool.
Okay. So the first step here, benefiting from that, with the PAS that you submitted to the FDA for the yield enhancement, you expect that approval mid-year. You talked about a 20% improvement in yield. So just confirm how you think about that with respect to your guidance for this year and next year. And how many more of these iterations could we see just based on what you said? And I'm going to tie in this another important point here in terms of your longer-term guidance of greater than a billion by 2030. How much more do you need from ADMAlytics to help you get there versus just the demand pull-through that you were talking about before?
Sure. To answer that part of the question, ADMAlytics is. I don't think we need much more from that to get to those revenue milestones. But your first part of the question?
Yeah, the 20% benefit and how you think about it in the guidance.
It's been a long couple of days, Gary. Last slot of the conference. I'm so excited.
Last but not least.
The 20% yield enhancement, so when we make our product, there are waste streams that come off, so there's a lot of things in our plasma, and we only want the antibodies, so there's loss along the way, and there are a couple of waste streams you were alluding to what could be next. There are a couple of waste streams where we lose a significant amount of Ig. So we've taken the waste stream, at least the first step is we've taken this waste stream where the largest amount of loss is, and it's really due to this new affinity ligand resin that's available from Thermo Fisher. We take this waste paste, if you will, and we resuspend it, and we process it over an affinity column, and it binds to the bad things, and out comes the good stuff, and we filter it.
And it's a very simple way of saying that we just can bring back this loss into the main part of the production stream. So we're very confident that 20% is attainable. We've done it a bunch of times both in our pilot scale and our commercial scale facility. I think there could be some additional upside there from this existing waste stream. But yes, there are some other waste streams that are there. And you sound like my head of scientific and technical ops. So shout out, Laura. The analysts are asking me the same things that you are. But I mean, look, I think we just have to evaluate. Is it worth the squeeze to get that much juice out of it? But yes, I think there are some other levers we could pull here.
But we also have some other tricks up our sleeve that as we progress into the future, there may be some other novel ways to separate plasma. I won't say fractionate, but separate plasma into the finished goods that we are trying to get. But I'm excited because, look, ADMA is a small, nimble company. We have the ability to just move a little bit quicker than some of the larger behemoths. Look, we have one plant. We make IG. And we're only focused on the U.S. market. So that is very different than any of the other players. All the other players are global players. They have other regulatory challenges. They make other products out of a liter of plasma. So while we consider them competitors, while we compete, we are substantially differentiated from the standpoint that we're much more nimble. We're able to make decisions faster.
I want to do something or they want to do something. And they all gang up on me. And I just say to Brad, "Hey, do we have the money to do it?" And he says yes or no. And I say, "OK, fine. Do it." I mean, it's a really simple way of running what appears maybe to the outside as a large business.
Just one more thing I want to clarify just on the guidance. And Brad, maybe I don't know if you want to take that.
It's not included in the 2025 guidance. Nothing from yield enhancement is in '25.
And '26?
'26 is heavily risk-adjusted. I mean, look, we take a conservative approach to guidance. Full stop. We're not going to change no matter how much you and other analysts and investors push us. I mean, we're going to take a conservative approach. And look, we feel good about this. Am I saying there's a chance that we could see some revenue accretion this year from yield enhancement? It's possible. It's not contemplated in the 490. It's quasi-contemplated in the 605. But really, what's driving the 605 for '26? I really think it has to do with our visibility into the high-titer plasma supply and what our production plan is for this year. I mean, if we hit our production plan for this year for Asceniv, which I think we're going to exceed, but if we hit it, we're going to beat the 605.
So all we have to do is just hit what we've set as an expectation for ourselves. If we do a little better, we're going to beat it. And I like the way I feel with the beat and raise. So we're going to try to keep it up as long as we can.
OK.
Yeah, just to be clear, when we refer to $1 billion in top line before 2030, we refer to that as a milestone. And the reason we refer to it as a milestone is because when we hit that milestone, we still believe there's significant headroom to go from there. So it really is a milestone. We're going to hit that milestone. And like I said, there's headroom to move from there.
OK. We have just a few more minutes. So a couple of important things to hit. So let's just keep it as brief as possible. And these are big topics, but just do an abridged version. Why can't any of the big behemoths do what you're doing? I get that question every time I talk to an investor who's new to the story. You have IP. There's natural barriers. But you're confident. I mean, you'll hit these numbers. Let's just assume that, but that no one else could come in and compete in this big space.
I think you've answered the question. I mean, we have intellectual property. We have issued IP around the test that we have developed internally. It's a proprietary test that we use to screen and identify who the plasma donors are. We also have a proprietary test on the release potency, if you will, of anti-RSV activity in the product. We have IP around the formulation of the plasma pool. We have IP on the final formulation. So when you look at this, we have a robust IP portfolio that protects Asceniv. And these companies are not in the business of lawsuits. And nobody wants that. What I'll also say is I kind of touched on it earlier. I mean, this is, look, I don't want to give the impression that it's so hard that no one can do this and we're going to screw it up.
But this isn't easy to do. I mean, if it was easy, other people would have done it. But look, again, to reiterate, we make one product, essentially. We sell in one country. We have one regulatory barrier. So for someone else to do what we're doing, they would have to disrupt their manufacturing efficiency company that they've built. I mean, the large fractionators, the huge companies in our space, they operate tens of millions of liters of capacity across multiple continents. And when I listen to some of the other companies out there, they have over 60 countries in the world that they have to file registration statements in. So when you look at us from a yield enhancement perspective, we're going to be what I like to say is essentially first with a yield-enhanced manufacturing method.
When I listen to some of the other larger companies, they're guiding to 2030-ish time frame. It's not that they're not as good as us. It's just they've got more work to do. They've got more barriers and more paperwork and more filings to make. So I think that that also speaks to the fact of why we're able to do what we do.
OK. And the last thing I definitely want you to touch on is the possibility of having other branches to this story and other hyperimmune products. And now your increased excitement about this S. pneumoniae hyperimmune product that you're going to have some animal data potentially by the end of the year. And could there be more of these to think about where you're not just, I'll call it a one-trick pony with Asceniv?
No. Great questions and yes, I am extremely excited about this. I haven't been this excited since the original data that I've seen on what is now Asceniv. But look, our founding principles were that we want to be a forward-thinking immune globulin company. I've grown up in this industry. For those who don't know my background, you can look it up. But I'm an indentured servant to the plasma industry. And I've just taken a different approach looking at this. And my dinner table conversations as a young kid were very different than others. And I just look at it as why these are not one-size-fits-all patients. Why has their treatment been for 40, 50 years one-size-fits-all? So Strep pneumoniaea is a tremendous opportunity, different from the standpoint of there are commercially available vaccines that we have IP around a proprietary donor stimulation protocol.
But we can immunize normal plasma donors with these vaccines, generate high-titer antibodies, and then make a hyperimmune-ish immunoglobulin that we don't know what we're going to target yet as the potential market opportunity. But Strep is the leading infectious cause of death globally. It is a complicated hospital-based hospital-acquired infection. Resistance from antibiotics is on the rise. Nobody is really developing new antibiotic therapies. I've got a dream that we could potentially who knows, maybe we can cure pneumonia. I have no idea. But at the end of the day, we're excited about this because, look, I mean, there is a tightness of supply of Ig in general in the U.S. Bivigam is a great product. It makes money. And we like the product. But at the end of the day, we just see opportunity where we can provide differentiated hyperimmunes with standardized levels of antibodies to infectious diseases.
Our IP protects this. And we feel that it's a way to provide something differentiated to help unmet needs of immune-compromised people in the U.S.
Excellent. We're going to end on that, up on time, so thank you, Adam. Thank you, Brad. Again, congrats on your progress. Good luck going forward, and thank you, everyone, for sticking around. I think this is basically the end of the conference, so safe travels wherever you're going, and we'll see you next year.