Officer of Aytu BioPharma. We're a NASDAQ-listed, Denver, Colorado-based specialty pharmaceutical company focused in the CNS space. Aytu is focused on improving patients' lives everywhere with a distinct focus on complex CNS conditions. We're a company committed to providing differentiated therapeutics for serious neurological and psychiatric conditions. We are now a pure-play CNS company with products in ADHD and a new product in major depressive disorder, or MDD. Before I jump into our exciting news about our new product here, we've gone through quite a bit of a transformation over the last few years. Back in the fall of 2022, we took a look at the business and realized we were doing way too much for what we were, a small little company. We had a clinical development project going on with a rare disease asset. We've been manufacturing our own ADHD medication in Grand Prairie, Texas.
We had a consumer health care business that was over the counter, growing top line great, but never profitable and didn't have a vision to get to profitability. We took a look and we said, you know, we got to do what we're good at, and that is being a specialty pharma commercial company. In October of 2022, we suspended our clinical development program and we've since divested that. In June of 2024, we paid off our term loan and refinanced it under better terms. Also, in June of 2024, we've completed the outsourcing of our manufacturing to a U.S.-based third-party contract manufacturer. Later, in December of 2024, we shut down the facility altogether and gave back the keys. In July of 2024, we divested our consumer health care business and wound that down.
In November of 2024, we reorganized some of the headcount in our operations for just optimization purposes. A lot went on in the last couple of years, and that has basically produced an improvement in our adjusted EBITDA of about $35 million. This past June, we just licensed an agreement to commercialize Exxua, never been launched, a major depressive disorder, MDD product that I'll touch on. Before I go into the Exxua, just an idea of what our core products are, you can see on the top left there, Adzenys and Cotempla are our two core products. Adzenys is an amphetamine, so we compete with Adderall on the ADHD side, and Cotempla is a methylphenidate, so we compete with kind of the Ritalins of the world. Total business is about $66 million. Those two products do about $58 million of it. The remaining is Karbinal, which is an antihistamine.
It's an extended release version of an antihistamine. Poly-Vi-Flor and Tri-Vi-Flor are fluoride tablets and drops for children where they're deficient in fluoride to improve their teeth. We did license another ADHD product called Metadate CD just recently. That is just now getting launched and is small from a revenue standpoint, but should continue to grow. The real story is in kind of the Exxua that I'll touch on. When we do license products, we do focus on IP-protected products and brands. That was what excited us about Exxua. It was approved in September of 2023, and we plan to launch it in December of this year. It's never been launched before, and it is protected through 2030, which doesn't seem like a long time, but in our kind of size, that's an eternity for us, five years.
Plus, we're looking to figure out ways to extend that patent just by tweaking some of the pieces of the product. We do have plans to hopefully extend that IP. All of our other brands have IP protection as well. Again, as I mentioned, $66 million of revenue. We're at June 30 year-end, so it's a little confusing, but we just filed our 10K, and about $58 million of that is our ADHD. What you will notice here is that our 2024 year, we did have pretty substantial growth. If you're familiar, in the U.S., we had a big Adderall or ADHD shortage, specifically Adderall . We were able to kind of scoop up a number of prescriptions in 2024, more than we were anticipating from a growth standpoint. The products continue to grow and steady, but this is kind of our now core-based business before Exxua.
One of the things that sets us apart from other specialty commercial companies is our internally developed RxConnect patient access program. If you're familiar with U.S. health care, first of all, it's a mess and secondly, t here are a lot of players, and the patient is the one that always suffers in terms of getting prescriptions. Typically, what happens is if an insurance company doesn't want to cover a brand, the patient could end up with a $300, $400, or $500 bill at the pharmacy level, and then they go back to the doctor and say, "I can't afford this on a monthly basis." A lot of insurance companies require prior authorizations, so they have to go back to the doctor, get forms filled out for the insurance company just to get their prescription. It's a lot of a headache for a patient and the doctor.
The doctor doesn't want to see that patient multiple times in a month when they've already sent out the prescription. What we've done is we've contracted with over 1,000 pharmacies nationwide where we go to them and say, "If it's not covered by insurance or the insurance is not covering it in full, the patient shall pay no more than $50 for the ADHD." What this does is ensures that the patient will get their prescription and they're happy. Excuse me. It ensures they don't go back to the doctor and have to try to change their prescription. Additionally, if there is a requirement for a prior authorization, we have a program that will help to facilitate that process in a more efficient way than the patient having to manage it with their doctor. 85% of our prescriptions actually go through this program with these 1,000 pharmacies.
What that really means is that 15% is going to the big box stores, your CVSs or your Walgreens. We feel that our prescriptions are well protected because they're in kind of either the local pharmacies or some of the larger grocery pharmacies, and we see a more consistent prescription refill rate than we would at the big box stores. From an operational structure, we have our own sales reps. We have about 40 sales reps across the country, primarily focused on the East Coast and Midwest, with a few scattered on the West Coast. The key here is that these sales reps focus on Psychiatrists and General Practitioners. Psychiatrists are key when it comes to ADHD and also to MDD, our new drug.
When we were first looking into Exxua, we looked for the overlap of where our Psychiatrists are currently calling on or where our sales reps are currently calling on, and there's about 60% overlap of MDD prescribers with our sales reps today. Pretty confident that they can throw this additional product into their bag and hit the ground running. Moving on to the actual opportunity of Exxua. If you're familiar with the MDD space, it is massive in the United States. It's about 340 million prescriptions a year. That's basically a prescription for every person who lives in the United States, about a $22 billion market, significantly bigger than ADHD. To give you kind of comparable, ADHD is about a $7 billion market with about 90 million prescriptions.
This new product, Exxua, with the drug named Gepirone, went through two well-controlled studies, and the key with depression is all the drugs work fairly well, and this one does as well. The efficacy is just as well as everything else. The key differentiator is the side effects. Two aspects of many of the drugs out there, sexual dysfunction and weight change, are the biggest complaints of patients with MDD taking prescriptions. This drug has neither one. It is not in the product information. It's not anywhere to be found. No sexual dysfunction or weight change, which is a key differentiator.
The reason for this is kind of the novel mechanism of action that it attacks the 5-HT1A receptor, which is one receptor in your brain, whereas a lot of the drugs that are out there, especially SSRIs and SNRIs like Prozac or Lexapro that you may be familiar with, tend to affect a number of receptors, and that causes the side effects. This drug only affects the 5-HT1A, which is the receptor that affects mood and emotion. This is the key excitement for this product. We think we've talked to a lot of psychiatrists, and they're excited about trying something that doesn't have the side effects. We talked about the patent coverage, and additionally, from a pricing standpoint in the U.S., the depression space is about 3x-4x the price of the ADHD space. Definitely higher dollar values from that standpoint. As I mentioned, a large market.
One other key differentiator with MDD is there's a lot of switching that goes on. Patients will start on a level one, which is like your Prozac or your Lexapro, and they'll have the side effects, and then they'll switch. Patients are constantly switching with MDD, up to 40%. Here you can see 70% of patients complain about sexual dysfunction, about 65% complain about the weight gain. This is a primary point and discussion with their psychiatrists on a regular basis. We've talked a little bit about, again, this is the 5-HT1A receptor that we touched on. It affects mood, emotion, pleasure. The 5-HT2A that I mentioned, that's the aspect of sexual dysfunction. It's steering clear of that receptor, which is why there is no side effect there. From a clinical trial standpoint, we did two eight-week randomized double-blind placebo-controlled studies.
By week three, it was statistically significantly different from the placebo. It definitely operates well, and we're excited for the opportunity to introduce this to the market. Here are just more facts about our clinical study. Only about 7% of the patients discontinued treatment compared to 3% on placebo. All these drugs have some sort of side effect. The ones that ours do have are dizziness, which is typically described as transient. It's kind of like when you stand up from the chair too fast and you feel a little off. Usually, it lasts about 30 seconds to a minute after taking the medication. Nausea is something that we do recommend that our product be taken with food, which is pretty standard for most depression products in the market.
The nausea is the aspect that we are looking into to try to tweak the drug maybe in the future to extend the patent life. From a competition standpoint, these are essentially our competitors. SSRIs and SNRIs represent about 60% of the market. As I said, they're level one. They're the first thing that psychiatrists will prescribe to patients. They'll move into the Wellbutrins, bupropion, and really where our competitors will lie is with Trintellix or Auvelity. I'll show you some stats on their revenue growth shortly. As you can see, we're the only ones without the sexual dysfunction, and the SSRIs and SNRIs both have weight change problems. We are weight neutral. The numbers, like I said, in depression are massive. It's not hard to do the numbers and figure out how big this can be. Our plan is really, we're not going to be a first-line therapy.
We're not going to be probably even a second-line therapy. We're really going to play more in the third or fourth-line therapies. Even if we took just a handful of each of these lines of therapy, these numbers are significantly better than what our ADHD does today. To give you perspective, we do about 400,000 prescriptions of ADHD. It's about $58 million. Even if we just did 100,000 prescriptions of MDD, that would be a $50 million product right out of the gate. We're pretty confident that we can grow this quite substantially. Our competitors have proven that. As you can see, Auvelity is probably the best comparable to this product. They launched in the fall of 2022 and have just skyrocketed. Just because of the switching and it's something new, psychiatrists are constantly looking for the next new product, and they're willing to try anything.
That proves out here with Auvelity and Caplyta. Even Spravato is an esketamine. It's actually a nasal spray that you have to take in a physician's office. That has seen tremendous growth. New products tend to do really well in this space. From a market research standpoint, we're covered by Lake Street from a financial analyst standpoint, but they performed a 20-person survey with psychiatrists, and all 20 said they would immediately prescribe Exxua. Additionally, we've engaged a third party to do an independent study of another 20 psychiatrists, and 19 of the 20 said they absolutely would prescribe. We're getting a lot of really good feedback. Even our CEO, Josh Disbrow, went to Houston two months ago, met with about 15 psychiatrists, and had really great reception. Most of the conversations led more towards the side effects than anything about the efficacy of the product.
Like I mentioned, our coverage, our sales force is well aligned in psychiatry already. This is going to be a plug and play. We don't have to add more sales reps. We're actually going to keep our sales reps at the 40 count to start with, and then we'll grow from there. One thing from a coverage standpoint that is a little unique, the U.S. government requires that depression prescriptions are covered by Medicaid and Medicare. It's a little different than ADHD where coverage is not covered, coverage is not given there. We expect that Medicare and Medicaid will be about 30%- 40% of our coverage, which tend to have pretty good margins from a gross to net standpoint. Pretty excited about the change from that standpoint.
From a promotion and go-to-market strategy, this is not a go on TV, go to every sporting event, put up banners everywhere kind of plan. This is a very efficient, direct to psychiatrist kind of marketing strategy, along with we hired a VP of Scientific Affairs to work on some publications with some key opinion leaders, as well as set up some speeches and talks. That's essentially the limit of kind of where the spend is going to go. We're really focused on getting in front of psychiatrists and having them make the decision on how to prescribe because we feel like that's where they're best suited. I've kind of touched on this ADHD side of things, but as you can see, it's a pretty stable business. It competes with, like I said, with Adderall and Ritalin.
We're probably only about 0.6% of the market, so we're not a massive company, but we think that these can fairly maintain while we grow the Exxua side of the business. We do have some out-licensing. This hasn't really gotten started yet, but in Israel and here in Canada, we've out-licensed our ADHD prescriptions or medication. They're still going through the approval process with the FDA. We do expect eventually to see some revenue from that, but not for a little while now. From a financial standpoint, I already mentioned $66 million. You see the improvement in the adjusted EBITDA over the course of the last five years. Gross margins are about 69%. Even with Exxua, they should probably be about 68%, 69%. They'll maintain.
On the right here, you can see kind of the impact of all of our adjustments and transformations over the course of the year from our OpEx standpoint. We've definitely slimmed down the business, focused on cash, and really driving where the value is. From a balance sheet standpoint, we sit on about $31 million as of June. We do have debt. We have just under $13 million in a term loan, and we have a revolving line of credit that gives us availability anywhere between $9 million and $12 million of availability. We've definitely cleaned up, I'd say in the last year to 18 months, have cleaned up the balance sheet quite a bit. We had some really high interest liabilities that are now completely off the books. Poised for this next phase in our transformation.
Overall, we think we're well positioned from a specialty pharma side of things, excited about this new drug launch. We have a great management team that has been with the company for a number of years. Many of them have come from the company that we acquired for the ADHD medication, but a lot of experience in launching products. Josh Disbrow and his brother, twin brother Jared Disbrow, have been with the company since it started. They had started another specialty pharmaceutical company years ago called Arbor Pharmaceuticals and grew that to about $250 million and sold that for about $1 billion. Very successful team in place. I'm going to skip to just from a cap table standpoint so you understand. We have about 9.9 million of common shares outstanding. However, I will point you to we have pre-funded warrants of about 9.2 million.
I tend to say, you know, call it 19 million of true outstanding common shares and 23.3 million fully diluted. We're basically about a $50 million market cap right now, trading below our revenue for a year. We've definitely seen improvement in our stock price, but you know, I think the market is still waiting to see what Exxua can do. From a holding standpoint, our largest shareholder is a fund called Nantahala Capital. They also sit on our board. They own about 24% fully diluted. We have another company called Stone Pine out of Oregon. They own about 16% fully diluted. We have about five funds that hold about 60%- 65% of our fully diluted shares, and they're all long. They're all in for the long haul on this MDD space. I think I've covered everything. If anyone has any questions, happy to take them. Yeah.
Is it intended to be monotherapy?
Yes. The question is, is it monotherapy? It is intended to be monotherapy. What I will say, and I'm not the science guy in the room, my understanding is with psychiatrists, they constantly tinker with other drugs. Sometimes they'll take a drug that's meant to be monotherapy and kind of tack on some others. The idea is for it to be mono.
Is the idea that it's going to be for patients who didn't tolerate SSRIs well, or are they going to trial it in patients that are treatment naive?
It probably won't be new patients just because insurance won't cover it. The SSRIs and SNRIs tend to be a genericized market. Insurance will tend to cover those well before a brand. You have to step through an SSRI and SNRI before you come to kind of the next level. That's kind of that step therapy.
Great. Last question. Were the phase threes conducted in treatment naive or in SSRI intolerant patients?
That is actually a question I don't know the answer to. Let me grab your information afterwards. I apologize. I don't know that answer.
It is not going to be first line, second line, probably fourth line. You have got three years of sort of patent left. I am still trying to look at the rationale for acquiring a drug when you have just such a short before you have to start planning for generic erosion.
Yeah. Five years is a long time for us, but you don't have to wait three years for this. This will be prescribed right away. Our goal is to basically drive this as fast as we can for the next three years, potentially look for ways to extend the patent life. If we can generate enough cash flow, right now our base business is cash flow neutral for the most part. If we can generate enough cash flow, we're constantly looking for the next drug. We're just a business development shop. We're already talking with other companies about licensing other drugs in the CNS space. We just want the cash flow to be able to do that. If we can generate $30 million, $40 million, $50 million of cash flow, we're now in a whole different subsegment of what we can actually license.
To give you perspective, this drug we license for $3 million upfront, another $3 million one year from launch, and then there are royalties, but it's all success-based. Pretty low kind of upfront relative to other drugs out there. Okay. Excellent. Thank you very much for your attention. Oh, sorry.
Just looking at the chart, what happened in late September when the stock declined so much and then came right back?
I'll say we didn't manage our analysts. We have three new analysts, two new analysts, and one that's been with us. Two of the analysts started in June, and they came out with numbers that were a bit aggressive for our June numbers. We realized we did a poor job managing that, and we didn't hit the numbers that they had set. You can see Lake Street, Ascendian Bank, and Maxim are the three that cover us. You'll see that their new reports have adjusted numbers. I think that was the main reaction to not hitting those numbers. The reality is our core business is fairly steady. It's really the future of Exxua. I think that's where people started coming back into the stock. Yeah.
You are CFO, right? You are CFO, right? You are a company CFO, right?
Oh, I'm the CFO. Yes.
Yeah. Your CEO has been with the company for 10 years, right? In the past 10 years, your company lost a lot of money, right?
Yes.
How can you let us believe the next step will be success, will be different from the past 10 years?
Yep. My CEO, he'll be here tomorrow. He will acknowledge the mistakes that he's made over the last 10 years. He started the business in 2015. Definitely a humble guy considering that he was successful in the past. He has had success in this industry. I think as they were growing, and I've only been CFO for less than a year now, there was a lack of discipline on kind of trying to do too much and trying to chase revenue. When he first started the business, he was on the OTC Stock Exchange, and those companies tend to chase revenue before profits, which sometimes you have to do. That's how we got into all these different businesses. It just got way too diverse and way too spread out and just no path for profitability. We've now streamlined.
Like I said, we're adjusted EBITDA to $9.2 million, but cash flow basically break even, and this is now the future. I think we're a lot more disciplined than we were in the past. This is a bigger market than we've ever been in in the past. Good question, though. Excellent. Thank you very much. Appreciate it.