Good morning, ladies and gentlemen, and welcome to Veru Incorporated Investors Conference Call. All participants will be in listen only mode. After this morning's discussion, there will be an opportunity to ask questions. Please note that this event is being recorded. I'd now like to turn the conference call over to Mr.
Sam Fish, Veru Incorporated's Director of Investor Relations. Please go ahead.
Good morning. The statements made on this conference call may be forward looking statements. Forward looking statements may include, but are not necessarily limited to, statements of the company's plans, objectives, expectations or intentions regarding its business, operations, finances and development of product portfolio. Such forward looking Statements are subject to known and unknown risks and uncertainties, and our actual results may differ significantly from those projected, suggested or included in any forward looking statements. Risks that may cause actual results or developments to differ materially are contained in our 10 Q and 10 ks SEC filings.
I'd now like to turn the conference call over to Doctor. Mitchell Steiner, Veru Inc's Chairman, CEO and President. Thank you, Sam, and good morning. With me
on this morning's call are Michelle Greco, CFO and CAO Michael Purvis, EVP, General Counsel, Corporate Strategy And Sam Fish, Director of Investor Relations. Thank you for joining our call. Veru is a late clinical stage oncology biopharmaceutical company with a focus on developing novel medicines for the management of 2 of the most prevalent cancers, prostate cancer and breast cancer. We're also committed to developing an effective drug therapy for COVID-nineteen, which is a Phase 3 program. We invest cash generated from our sexual health commercial business into the clinical developments of our potentially high value oncology and COVID-nineteen drug candidates.
This morning, we will discuss the progress of our late clinical stage prostate cancer and breast cancer drug programs as well as We will then provide financial highlights for our record Q3 fiscal year 2021. Bureau anticipates having 4 registration clinical trials in prostate cancer, breast cancer and for COVID-nineteen And 2 potentially registration enabling clinical trials in breast cancer up and running by the end of the calendar year 2021 for a total of 6 Pivotal potentially pivotal studies. 2 of these Phase 3 VERASITY study in prostate cancer And the Phase 3 COVID-nineteen clinical study have already commenced. We have been very busy executing on this bold plan And you will see that we're making significant progress. In our prostate cancer clinical program, the company has initiated and is enrolling 2 clinical trials, The Phase 3 VERASITY study to evaluate cebisobulin for the treatment of metastatic castration and the angina receptor targeting agent resistant prostate cancer And a Phase 2 dose finding clinical study for VERU-one hundred, a GnRH antagonist 3 month long acting depot delivery formulation For androgen deprivation therapy of advanced hormone sensitive prostate cancer.
Cebizobulin is an oral first in class new chemical entity The targets, cross links and disrupts alpha and beta tubulin subunits of microtubules to disrupt the cytoskeleton. And in prostate cancer, this also results in disruption of antigen receptors transport from the cytoplasm into the nucleus. The Phase 1btwo clinical study enrolled 39 men in the Phase 1 portion and 41 men in the Phase 2 portion. Phase 2 portion is completely enrolled and is still ongoing. The safety of subizobulin appears to be similar to the androgen receptor targeted agents like abiraterone and enzalutamide based on what has been reported in their package inserts, long term daily chronic drug administration appears to be feasible and safe.
We have patients in the Phase Ib portion that have been on treatment for over 2 years without evidence of prostate cancer tumor progression. At the recommended Phase 2 dose of 63 milligrams, the most common adverse events were mostly Grade 1 and 2 diarrhea, fatigue and nausea. There have been no clinically relevant reports of neutropenia, neurotoxicity or hair loss. The Phase 1b2 study also has yielded promising and significant efficacy outcomes. The efficacy results show PSA declines and responses as well as objective and durable tumor responses, including partial and complete responses.
For the intent to treat population of all men with measurable disease at baseline, which is 29, The objective tumor response rate is 21%. In all men that received 63 milligrams or greater dose of cebizobulin, which is 55 men, The median radiograph progression free survival has not been reached as the study is still ongoing, but it's estimated to be greater than 7.4 months. We initiated this past quarter the Phase 3 VORASITY clinical study, which is an open label, 2:one randomization study Evaluating the efficacy and safety of sebazabulin 32 milligrams oral daily dosing versus an alternative antigen receptor targeted agent And men with metastatic castration resistant prostate cancer who have failed at least 1 androgen receptor targeted agent but prior to IV chemotherapy. Primary endpoint is median radiographic progression free survival. The trial assumptions expect the median radiographic Progression free survival was 7.4 months for sebizobulin versus 3.7 months for the alternative antigen receptor targeted agent, which if achieved, Would represent a doubling in the improvement of median radiographic free progression free survival and to zebizobulin With visibility when compared to the active control, the study's statistical assumptions to estimate sample size of 245 subjects Included using an alpha of 0.05, a power of 98% and a dropout rate of 30%.
We expect enrollment to take 10 months He's a Deputy Director at the University of Virginia Cancer Center, Director of Solid Tumor Oncology and Professor of Hematology and Oncology. In summary, cibizobulin is an oral agent with a novel targeted mechanism of action that based on scientific literature and package insert It has a similar safety profile as a novel engine receptor targeted agent and sebizobulin has efficacy at least comparable to, if not better, And IV docetaxel chemotherapy in this patient population. Further, chronic oral administration is feasible. Thus, so far, it appears we have met our clinical target product profile goal of having an agent that can be prescribed prior to IV chemotherapy by both urologists and medical oncologists. Thus, cebizobulin could be potentially the next go to drug to be prescribed in the management of men With metastatic castration and androgen receptor targeting agent resistant prostate cancer.
Current global sales for Androgen receptor targeted agents like abiraterone, enzalutamide and apalutamide are approaching $6,000,000,000 Unfortunately, all men will develop resistance to these drugs and have prostate cancer progression. This means that the only other option They will have is to proceed to IV chemotherapy. Thus, abisobulin, if approved, will address a large part of the metastatic prostate cancer market. Next, I will update you on VERU-one hundred, a long acting androgen deprivation therapy for the treatment of hormone sensitive advanced prostate cancer. Androgen deprivation therapy is currently the mainstay of advanced prostate cancer treatment and is used as the foundation of treatment throughout the course of the disease.
Furthermore, androgen deprivation therapy is continued even as other endocrine chemotherapy or radiation treatments are added or stopped. Standard medical practice for urologists and medical oncologists is to administer androgen deprivation therapy every 3 to 4 months in their office. These injections coincide with the follow-up office visits and imaging assessments for metastatic or advanced prostate cancer. Furthermore, these injections are administered as a buy and build product and are reimbursed under Medicare Plan B, not Plan D. So the urologist is compensated for both the drug and administering the drug.
Patients' compliance is 100% once the injection has been administered. Therefore, most physicians strongly prefer injections over oral agents. Gonanotropin releasing hormone antagonist treatments of GnRH treatments versus agonists are preferred because castration occurs rapidly with no surges or flares in testosterone. Testosterone levels also tend to be lower, which is better for tumor control. GnRH antagonist are also lower FSH levels, which is thought to be the reason why there are fewer cardiovascular side effects with GnRH antagonist versus GnRH agonists.
There are no GnRH antagonist depot injection formulations currently approved for treatment beyond a 1 month duration. VERU-one hundred is a novel proprietary long acting peptide 3 months subcutaneous depot formulation injection Designed to address the current limitations of commercially available agents for androgen deprivation therapy. In this past quarter, we have initiated and are enrolling a Phase 2 dose finding clinical study evaluating VERA-one hundred and thirty five men. We expect to have clinical data to report by year end. The open label Phase 3 registration study, whose design has already been agreed upon by FDA, will evaluate the efficacy and AVERA 100 in approximately 100 men with hormone sensitive metastatic prostate cancer and is anticipated to start at the end of the calendar year of 2021.
Next, I will discuss the progress of our breast cancer program. Veru is planning to initiate the following breast cancer studies during this half of the calendar year. In Phase 3, our test clinical study Evaluating Inovisar monotherapy in a 3rd line metastatic setting in women with AR positive, ER positive, HER2 negative metastatic breast cancer We have progressed following estrogen blocking agents and CDK4six inhibitor. A Phase 2b clinical study evaluating Inova combination of abemaciclib, a CDK4six inhibitor in a second line metastatic setting In women who have progressed following first line palbociclib, a CDK4six inhibitor in combination with an estrogen blocking agent And a Phase 2b clinical study evaluating sebizobulin monotherapy and sebizobulin Plus, Trodelbi combination therapy versus Trodelbi monotherapy in women with metastatic triple negative breast By way of background, the most common type of breast cancer, which occurs in about 85% of women, is ER Consequently, treatments that target and block the estrogen receptor are the mainstay of breast cancer therapy. According to the 2020 National Comprehensive Cancer Network guidelines, The recommended first treatment in the metastatic set first line treatment in the metastatic setting is either a non steroidalomatase inhibitor In combination with CDK4six inhibitor or fulvestrant in combination with CDK4six inhibitor.
The recommended second line treatment in the metastatic setting is fulvestrant in combination with CDK4six inhibitor if a CDK4six inhibitor was not used in the first line metastatic Fortunately, almost all women being treated with these regimens will eventually develop resistance to estrogen blocking agents and the CDK4six inhibitor therapies, And there are limited clinical data that allow recommendation for a treatment containing another CDK4six inhibitor for these patients. Alternative treatment approaches that target novel pathways will be required as there are limited treatment options following CDK4six inhibitor And estrogen blocking agent resistance in the management of ER positive HER2 negative metastatic breast cancer. Interestingly, like the estrogen receptor, the androgen receptor is found in over 85% of breast cancers. The antireceptor is a tumor suppressor in estrogen receptor positive breast cancer. This means that when the antireceptor is activated, it strongly suppresses ER This explains why historically when synthetic androgens were used to treat breast cancer, they demonstrated good efficacy.
But unfortunately, the masculinizing side effects such as facial hair acne, increase in hematocrit liver toxicity have prohibited their use as a viable treatment. In contrast, Inovisar, an oral first in class new chemical entity is a Selective androgen receptor targeted agonist that's being developed for the treatment of AR positive, ER positive, HER2 negative metastatic breast cancer and would represent the 1st new endocrine therapy for advanced breast cancer in decades. Inovisarm has extensive non clinical and clinical experience Having been evaluated in over 25 separate clinical studies involving more than 2,100 subjects, including 5 prior Phase 2 clinical studies In advanced breast cancer involving more than 250 patients. In addition to suppressing AR positive, ER positive breast cancer cell proliferation And tumor growth, InnovusArm has other potential beneficial clinical properties. In preclinical studies, InnovusArm has demonstrated That it builds and heals corticotrubecular bone and therefore has the potential to treat the osteoporosis caused by the estrogen deprivation and cancer skeletal related events.
Inovisarm has also been shown to build muscle and to improve physical function in clinical studies involving elderly subjects and patients with cancer cachexia, including breast cancer patients. Furthermore, because of its tissue selectivity, Novosarm has a favorable side effect profile with no masculinization, no increase in hematocrit and no liver toxicity. 2 positive Phase 2 studies involving approximately 150 women with AR positive, ER positive metastatic breast cancer were conducted. The G200-802 Phase 2 study was a 2 arm study that evaluated 9 milligrams and milligrams of the Novusarm daily oral dosing in 136 women with AR positive, ER positive, HER2 negative advanced breast cancer. Patients in the eight zero two study were heavily pretreated, having failed on average 3 an average of 3 estrogen blocking agents and 88% have received prior chemotherapy.
In this study, clinically meaningful tumor responses were observed with Inovuson monotherapy and which Strongly establishes the relevance of targeting the androgen receptor with a selective androgen receptor agonist in women that were heavily pretreated With estrogen blocking agents and resistance and had AR positive, ER positive metastatic breast cancer. Innovacem appears safe and well tolerated without masculinizing effects, increasing hematocrit or liver toxicity. Quality of life measurements demonstrated overall improvement, including mobility, anxiety, depression and pain. The 9 milligram dose was selected for our Phase 3 study and the 9 milligram cohort compared to the 18 milligram cohort had a similar tumor responses, Slightly better toxicity profile. Furthermore and most importantly, we also performed a post hoc subset analysis of this Phase 2 clinical data to evaluate the relationship of the androgen receptor status with the Novosarm antitumor efficacy.
The subset analysis showed that the presence of the antigen receptor and the amount of the antigen receptor expression in the breast cancer tissue predicted those women We're more likely to have a positive response to Inovisar. More specifically, the subset analysis combined randomized subjects in both the 9 milligram In 18 milligram cohort, we had known antigen receptor status determined by central lab and who had measurable disease and that was 84 subjects. The cutoff of greater than or equal to 40% AR expression appeared to be the best level to enrich the subjects that were most likely to respond to Inova The clinical benefit rate at 24 weeks was 52% at greater than or equal to 40% AR staining versus 14% for less than 40% AR staining and that P value was less than 0.0004. The best objective tumor response, that's partial responses plus complete responses, was 34% at greater than equal 40% AR staining versus only 2.7% to less than 40% AR staining and that p value was less than 0.0003. And the median radiographic progression free survival was 5.47 months at greater than equal to 40% AR staining versus 2.7 months for less than 40% AR Staining when that P value is less than 0.001.
Using this 40% cutoff, 57% of all women with AR positive, ER positive HER2 negative metastatic breast cancer Would qualify for treatment with Inovusarm. Thus, the presence and the degree of antigen receptor expression in breast cancer tissue What's important for InnovusRxant's antitumor activity, which is consistent with InnovusRx being a targeted agent or biomarker That could select or enrich for subjects most likely to respond to Innovus Arm therapy. As we recommended by FDA based on these clinical data, AR expression status by immunohistochemistry will be validated as a companion diagnostic test and is a critical inclusion criterion in our clinical trial design. We are collaborating with a large global diagnostic The company, which we'll announce when our agreement is complete, that has the expertise to help us with the development and validation of an AR companion diagnostic test in parallel with our Phase 3 AR test clinical study. By targeting the antigen receptor In ER positive metastatic breast cancer, InnovusArm introduces a novel endocrine therapy to patients with breast cancer They have exhausted estrogen blocking agents in CDK4six inhibitors, but prior to IV chemotherapy.
We are developing Inobisarm in 2 major indications in ER positive HER2 negative metastatic breast cancer. The first indication is to evaluate Inovisar monotherapy in a 3rd line metastatic setting. We will conduct this Phase 3, our test registration study as an open label, Multi center, multinational, randomized 1 to 1, active control pivotal study evaluating the efficacy and safety of Innovusarm 9 Or serum, it's a physician's choice, in centrally confirmed greater than equal 40% AR staining, AR positive, ER positive, HER2 negative metastatic breast cancer subjects who have failed a non steroidal AI, fulvestrant and the CDK4six inhibitor. The primary endpoint is median radiographic progression free survival. The statistical assumptions include an estimated Median radiographic progression free survival of 6 months for Enobasan monotherapy versus less than 3 months for the active control With an alpha of 0.05, 99 percent power and a 20% dropout rate, the sample size will be approximately 210 subjects.
We expect enrollment to take 10 months recruitment time and 12 months follow-up after the last patient is first dose. We expect that the antigen receptor companion diagnostic test will be developed in parallel with the Phase 3, our test study with our diagnostic company partner. The Phase 3 ARTEST study will be conducted in 49 clinical sites across the United States and Europe and is anticipated to commence soon. The second indication to evaluate Inovusarm plus a CDK4six inhibitor combination therapy in the second line metastatic setting. We will conduct a Phase 2b clinical trial to evaluate the efficacy and safety of Inovusarm plus a CDK4six inhibitor, bemaciclib, Combination versus an alternative antigen blocking agent either forvestrant or non steroidal excuse me, either forvestrant Rheumatase inhibitor in an AR positive, ER positive, HER2 negative metastatic breast cancer patients who have failed their first line therapy, We just commonly palbociclib, a CDK4six inhibitor plus an estrogen blocking agent.
This is an open label, 2:one randomization clinical study in approximately 186 subjects and is expected to commence in a few months. Both of these indications represent large market opportunities as palbociclib global sales are approaching $6,000,000,000 in breast cancer. And unfortunately, almost all of these women will develop resistance to palbociclib and have tumor progression. The goal is to position the Novosarm as the next go to in both the second line and third line setting for AR positive, ER positive, HER2 negative metastatic breast cancer. Next, I will update you on the 3rd clinical study in our breast cancer program, a Phase IIb clinical study For chemotherapy resistant metastatic triple negative breast cancer.
Metastatic triple negative breast cancer is an aggressive form of breast cancer that is present in approximately 15% of all breast cancers, this form of breast cancer does not express the estrogen receptor, progesterone receptor or HER2 And is resistant to estrogen blocking agents. Thus, the first line of treatment usually consists of multiple systemic chemotherapies, including IV taxane chemotherapy. Unfortunately, almost all of these women will eventually develop resistance and exhibit tumor progression. In preclinical studies of human triple negative breast cancer that has become resistant to paclitaxel, which is a taxane, cebizobulin Significantly inhibits cancer proliferation, migration, metastasis and invasion. We plan to initiate an open label 3 arm Phase to evaluate the efficacy and safety of oral, sebizipullin monotherapy and sebizipullin tridelvi combination therapy versus Tridelvii monotherapy in the treatment of approximately 2 16 subjects in a 1:one:one randomization In metastatic triple negative breast cancer patients who have failed at least 2 systemic chemotherapies, the primary endpoint will be objective tumor response rates, ORR, In human prostate cancer trials, chronic oral daily administration, sebizobulin is well tolerated, and there was no reports of neutropenia.
By the way, It will be interesting to see whether sebizobulin in combination with Trodelvi could result in less neutropenia with better efficacy, Similar to what has been observed in the recently reported successful metastatic non small cell lung cancer clinical trial The plinabulin, an IV colchicine site targeted antitubulin with a similar mechanism as sebizobulin In combination with docetaxel prevented the docetaxel induced neutropenia, improved radiographic progression free survival And overall survival even compared to docetaxel. The Phase 2b clinical study is planned to commence soon. The clinical development of sebizobulin in metastatic breast cancer represents a second major clinical oncology indication for sebizobulin. Next, we will discuss our 3rd clinical program, sebizobulin 9 milligrams for the treatment of hospitalized patients with COVID-nineteen Who are at high risk for acute respiratory distress syndrome. Sebizobulin in this setting is a novel once daily orally dosed small molecule with both broad antiviral and anti inflammatory activities, which may serve as a 2 pronged approach to the treatment of COVID-nineteen virus infection and the subsequent debilitating inflammatory effects that lead to acute respiratory distress syndrome and death.
We conducted a double blind randomized placebo controlled Phase 2 clinical trial evaluating once daily oral dosing of cebizobulin 18 milligrams versus Placebo in 39 hospitalized COVID-nineteen patients who have high risk for acute respiratory distress syndrome. In the intent to treat population, sebizobulin reduced the proportion of patients who died on study from 30% at 6 of 20 In the placebo group to 5.3 percent, 1 of 19 in the sebizobulin treated group and that p value was 0.044. This is an 82% relative reduction in mortality in the So show significant and clinically meaningful reductions in days in the ICU. Tibuzumabulin on average is 3 days versus placebo of 9.55 days. Sebizobulin reduced the days on mechanical ventilation from an average of 5.4 days in the placebo group to 1.6 days in the sebizobulin treated group.
Zabizobulin was well tolerated with a good safety profile. We're currently enrolling a COVID-nineteen Phase III clinical trial, 9 milligrams of bisibulin for up to 21 days versus placebo in 300 hospitalized COVID-nineteen patients, Of which, 200 subjects will be treated with sebizobulin and 100 subjects will receive placebo, who are at high risk for acute respiratory distress syndrome. Subjects in both the sebizipullin and placebo arms will be allowed to receive standard of care. The primary efficacy endpoint will be proportion of patients who die on study up to day 60. Secondary endpoints The study is being conducted in the United States, Brazil, Argentina, Mexico and Colombia.
Enrollment is on track to be completed by calendar year end. The company has sufficient clinical drug supply on hand to complete this Phase III clinical study. We will We're still seeking funding from the Biomedical Advanced Research and Development Authority of the U. S. Department of Health and Human Services, BARDA and other agencies to try to fund the estimated amount of commercial drug to supply the needs of the United States assuming confirmatory Positive clinical results and FDA approval.
We believe we have the resources to conduct our planned cebizobulin for COVID-nineteen Phase 3 without impacting our other cancer drugs clinical development. As you're aware, we're not out of the woods with COVID-nineteen pandemic. COVID-nineteen cases, hospitalizations and deaths are once again increasing in nearly all states and are fueled by the Delta variant, which is much more contagious than the past versions of the virus. Other variants are still emerging. The highest spread of cases with severe outcomes It's happening in places with low vaccination rates.
COVID-nineteen infection rates and hospitalizations are at a serious level and the CDC Reversing the recommendations back to those used during the peak of the pandemic. There is no doubt we have had a major setback in the Patients with moderate to severe COVID-nineteen disease with risk for acute respiratory distress syndrome is desperately needed alongside an effective vaccination campaign. We strongly believe that zebizobulin, its anti inflammatory and antiviral properties Its favorable safety profile can be that greatly needed oral therapy. Based on the strength of these Phase 2 clinical study, Promising clinical results. The company continues to be duty bound during this persistent global pandemic to pursue this COVID-nineteen indication, even though it's not the primary focus of the company.
Finally, I will comment on TADFIN. TADFIN is our combination tadalafil 5 granastomide 5 milligram capsule developed to treat lower urinary tract symptoms caused by benign prostatic hyperplasia. The combination product contains tadalafil, which is approved for the treatment of BPH and erectile dysfunction and finasteride for BPH. Our PDUFA decision date for TADFIN is in December of 2021. We plan to launch TADFIN if Approved via digital marketing and telemedicine channels.
And when launched, it should be a near term source of additional revenue for Veru to invest in our promising oncology pipeline. Although Ms. Greco will provide the full financial highlights in Veru's commercial segment, Which is FC2 and drug commercialization costs, I am happy to report that we've achieved another record quarter And year to date. In fact, our 9 month year to date revenue increased 48% to $46,000,000 which has already beat the revenue of $3,000,000 we had for the entire fiscal year of 2020. Our growing base commercial business, which is now in its 4th year of growth And the prospects of additional growing revenue from FC2 plus the future revenue from TadFin places Veru on solid financial footing To have the resources to continue to invest in our promising premium drug pipeline for large market opportunities.
I will now turn the call over to Michele Greco, CFO, CAO to discuss the financial highlights. Michele?
Thank you, Doctor. Steiner. As Doctor. Steiner indicated, we're having another great year. In December, the company sold PREBOOST for $20,000,000 In February, the company completed an equity raise, which resulted in $107,900,000 in net proceeds after deducting underwriting commissions and costs.
And in the Q3, the company achieved record level net revenues and gross profits Related to the sales of FC2, for the 1st 3 months of fiscal year 2021, our net revenues were $45,600,000 surpassing $42,600,000 in net revenues for the entire fiscal year of 2020. We have already Let's Start our highlights with Q3 results for the 3 months ended June 30, 2021. Overall, net revenues were up 71 percent to $17,700,000 from $10,300,000 in the prior year Q3 due to the growth of our FC2 U. S. Prescription business.
The company reported significant FC2 sales growth business with net revenues up 150 percent to $13,500,000 from $5,400,000 in the prior year Q3. Gross profit rose 113 percent to $13,900,000 or 79 percent of net revenues compared to $6,500,000 or 63% of net revenues in the prior year Q3. The increase in gross profit and gross margin is driven primarily by increased sales in our U. S. FC2 prescription business.
Operating expenses for
the quarter increased to $16,700,000
compared to the prior year quarter $7,900,000 Research and development costs were $11,200,000 compared to $4,400,000 in the prior year quarter due to the commencement of several new phases in our clinical trials. The operating loss for the quarter was $2,900,000 compared to $1,400,000 in the prior year quarter. In the prior year, the company received a forgivable loan of approximately $540,000 Under the Paycheck Protection Program of the CARES Act, the forgivable loan was treated like a government grant and recognized The reduction in operating expenses during the quarter. As a result, we recorded a reduction to selling, general and administrative expenses of approximately $420,000 and a reduction to payroll related research and development costs of approximately $120,000 Non operating expenses were $2,700,000 compared to $1,400,000 in the prior year Q3 And primarily consisted of interest expense and change in the fair value of the derivative liabilities related to the synthetic royalty financing. We entered the synthetic royalty financing during March of 2018.
For the quarter, we recorded a tax benefit of $2,900,000 compared to a tax expense of $241,000 in the prior year Q3. The tax benefit recorded for quarters primarily due to the increased value of the U. K. Net operating losses due to an increase in the U. K.
Tax rates from 19% to 25%. The bottom line results for the Q3 of fiscal year 2021 was a net loss of $2,700,000 or $0.03 per diluted common share compared to a net loss of $3,000,000 or $0.05 per diluted common share in the prior year Q3. Turning to the results for the 9 months ended June 30, 2021. For the 1st 9 months of fiscal year 20 21 total net revenues were up 48 percent to $45,600,000 from $30,800,000 in the prior year period, again, a record high for any fiscal year. The company reported growth in FC2 sales in the U.
S. Prescription Business and in the Global Public Sector Business. Net revenue from the U. S. Prescription business was up 79% to $32,900,000 from $18,400,000 in the prior year period.
Net revenue for the Global Public Health Sector Business was up 6% to $11,800,000 for the 9 month period. Overall, gross profit was $35,600,000 or 78% of net revenues compared to $21,200,000 or 69% of net revenues in the prior year period. The increase in gross profit and gross margin is due primarily to the increase in the U. S. Prescription business and a decrease in labor transportation and equipment maintenance Operating expenses increased by $14,500,000 to $39,200,000
compared to the prior year period of $24,700,000
The increase is primarily driven by research and development costs, which increased by $10,800,000
to $24,400,000
from $13,700,000 in the prior year period. Operating income for the period was $14,800,000 compared to an operating loss of $3,500,000 in the prior year period, an increase of $8,300,000 The increase is primarily due to the gain on sale of Preboost of $18,400,000 Excluding this gain, we had an operating loss of $3,600,000 for the period. Non operating expenses were $5,900,000 compared to $3,600,000 in prior year period and primarily consisted of interest expense and change in the fair value of the derivative liabilities related to the synthetic royalty financing. For the 9 month period, we recorded a tax benefit of US federal tax purposes of $42,000,000 with $13,800,000 expiring in years through 2,040 And $28,200,000 which can be carried forward indefinitely. Our UK subsidiary has net operating loss carry forwards of $61,300,000 which do not expire.
The bottom line results for the 1st 9 months of Fiscal year 2021 was net income of $11,700,000 or $0.14 per diluted common share compared to a net loss of $7,100,000 or $0.11 per diluted common share in the prior period. Excluding the gain on sale of PREBOOST, The adjusted net loss was $6,700,000 or $0.09 per diluted common share in the current period. Now turning to our balance sheet. As of June 30, 2021, our cash balance was $123,200,000 Our accounts receivable were $8,300,000 Due to our sale of PREBOOST in December, we added $15,000,000 in cash during December and $5,000,000 in notes receivable, which will be collected over the next 10 months. In February, we completed an underwritten public offering of 7,419,354 shares of our common stock at a public offering price of $15.50 per share.
Net proceeds were $107,900,000 Our net working capital was $137,200,000 at June 30, 2021 compared to $12,300,000 at September 30, 2020. During the 9 months ended June 30, 2021, we used cash of $14,800,000 for operating activities compared with $1,600,000 used for operating activities in the prior period. Overall, we're delighted to see the continued increases in sales in the FC2 business. This revenue source, together with our strong balance sheet, Continue to be the sources of funds we use to invest in our promising pharmaceutical clinical development programs as we continue to transform our company into a premium Now I'd like to turn the call back to Doctor. Steiner.
Thank you, Michelle. Our company's fundamentals are strong. We have enjoyed another strong record financial quarter with also another record We'll have a record year in revenue. With the robust performance of the commercial business plus the prospects for additional future revenues from Tadfin, Coupled with our strong cash position, we believe that we'll be able to substantially invest in the continued clinical development of our prostate and breast cancer drug product candidates as well as the bisibulin COVID-nineteen Phase 3 clinical study. We plan to continue to generate robust Growing revenues for our sexual health business.
We have successfully transformed our company into a late clinical stage Oncology biopharmaceutical company supported by growing revenue from our cash generating sexual health business. We have already We are already currently enrolling or plan to enroll a total of 6 pivotal or potentially pivotal studies this calendar year for major indications and large market opportunities. To summarize, in the prostate cancer clinical program, the company has initiated and is enrolling Two clinical trials. Prostate cancer remains a very serious cancer as it is the 2nd leading cause of cancer deaths in men. Drug product candidates that we're developing are for 2 important indications.
First, VL-one hundred, GnRH antagonist 3 month delivery formulation of androgen deprivation therapy of advanced hormone sensitive prostate cancer has attributes to address the commercial limitations The Phase 2 dose finding clinical study is enrolling and we expect to report results in the second half of the calendar year And the Phase 3 clinical study has already been accreted upon by FDA is expected to be initiated shortly thereafter. The 2nd major indication and market opportunity takes advantage of the adoption and the widespread use of androgen receptor targeted agents, which have moved very early in the care of advanced prostate cancer, almost all men will develop resistance to these drugs and their prostate cancer will progress. The market for androgen receptor targeted agents is approaching $6,000,000,000 annually. We're developing cebizobulin, an oral agent has the efficacy that appears to be similar, if not greater, to what has been reported in the literature for chemotherapy, but has side effect profile that's similar to what has been reported in the packaging search for androgen receptor targeted agents. This will allow cebizobulin, if approved, To be prescribed by both urologists and medical oncologists for MenaFTA progressing on the androgen receptor targeted agent but before IV chemotherapy.
The Phase 3 veracity clinical study to evaluate cebisobulin for the treatment of metastatic, castration and In the breast cancer program, the company expects to initiate 3 clinical trials soon. Breast cancer also remains a very serious cancer as it is also the 2nd leading cause of cancer deaths in women. UF positive breast cancer occurs in 85% of all breast cancers. The standard of care now uses CDK4six inhibitor in combination with an estrogen blocking agent in the first and second line metastatic settings. Almost all women will become resistant to CDK4six Inhibitor and the standard of care in this setting is now being defined.
The drugs we are developing are for 2 indications in AR positive, ER positive breast cancer. Using companion diagnostic, we're selecting women who have greater than 40 greater than equal to 40% AR standing in breast cancer tissue, which will represent approximately 50% of all women who are ER positive with metastatic breast cancer. The first indication for Inovisar monotherapy is in the 3rd line setting. The second indication is a Phase 2b Clinical study that will evaluate Inovisar combination with abemaciclib, a CDK4six inhibitor in the second line setting. Inovisarm, by targeting and activating the antireceptor, represents the first new hormone therapy in breast cancer in decades.
For the other 15% of women that have triple negative breast cancer, we plan to initiate the Phase 2 clinical study evaluating sebizobulin monotherapy And sobusobulin plus Tridelbi combination therapy versus Tridelbi monotherapy in women with metastatic triple negative breast cancer who have failed at least 2 chemotherapies. The goal is to see subizobulin alone or in combination with TRODALBI will have better efficacy and safety profile, specifically Possible protection against Neutropedia than TRODELVI alone. Finally, we're enrolling a Phase 3 clinical trial to evaluate sabizobulin Hospitalized COVID-nineteen patients who are at high risk for ARDS. We're still in the middle of a global pandemic. The fact is that COVID will be a long war.
We have witnessed evidence of this over and over. The bottom line is that although we have effective vaccines for now, We still need effective drugs to win the war. We have to continue to be steadfast in the execution of our Phase 3 clinical study. If we confirm the promising results observed in the completed Phase 2 clinical study, we expect to seek emergency use authorization for this indication. We are committed COVID is not going away.
In summary, we have a portfolio of premium late clinical stage drug We expect a stream of steady positive news flow achieving clinical trial milestones and reports of clinical trial data. We are open to the possibility of a pharmaceutical partnership if it enhances shareholder value. And we have a rapidly growing commercial base With that, I'll now open the call to questions. Operator?
Ladies and gentlemen, at this time, we will begin the question and answer session. Please limit yourself to one question and one follow-up. If you have further questions, you may reenter the question rejoin the question queue. We will pause momentarily to assemble our roster. Our first question comes from Brandon Folkes from Cantor Fitzgerald.
Please go ahead.
Hi, thanks for taking my questions and congratulations on all the progress. Maybe firstly, just having transformed Veru into an oncology company, you do have a fair amount going on. So Do you have any sense of urgency to sell the FC2 business just to streamline the company and reinvest those funds? And then along those lines, Any change in thinking about whether you may fund the COVID program yourself given the date yes, Well, once you see the data? Thank you.
Yes. Brandon, thank you very much for both questions. So the first question is, given that we clearly have transformed ourselves into an oncology company And there's no doubt now with the Phase III and the Phase IIb that we're on track with 2 of the major cancers in areas that are large markets. So we feel very, very good about that. But interestingly, we're also with the FC2 business, we're Looking for strategic options, but the strategic options have it's been most interesting that we're not in it, in a rush.
So the key word that you used was urgency. So there's no real urgency because look, it's generated $45,000,000 This is the last 9 months. 9 months. And if we can stay on track with that same growth, We're essentially bringing in the amount of money we need to fund all of our clinical trials. And so if you look at it that way, you look The cash in the bank, we raised $107,000,000 We got $120,000,000 whatever number $130,000,000 we had the accounts receivable almost to $140,000,000 So we're not burning through our cash.
So we're in a very interesting position that we're in the driver's seat to see what we want to do with the asset. So I think and by the way, strategic options doesn't always mean sell the business. There can be other things that we can do that can And shareholders value and allow our shareholders to get the best of both worlds. So we're working through that, no urgency. And it's not taking our eye off the ball, which is to continue to push and execute on the oncology side.
As it relates to your second question, what I said relating to COVID-nineteen and whether or not we're prepared to fund after we report positive results. So as I mentioned in my prepared remarks That we have the resources and we have the clinical trial supply, drug supply. So we're going to be able to run this study without losing a beat. And so we're not dependent on external funding for that. If we have successful data, we're going to be in a very interesting position again because even though we have Begun to increase the scale up of sebizobulin because of the multiple trials that are going on, including COVID-nineteen.
It's a different level of production that you need to do to get ready for the U. S. Population in the world. With that said, We will see. I mean, I think if we're at a 9 milligram dose, you don't need a lot of drug to begin and it's only a 21 day Treatment and we can do the treatments at 7 day intervals.
So there is a lot of flexibility to try to spread The drug as quickly as we can. But the ideal situation would be just like you saw recently with Merck that The government will step in and provide the resources required to scale up so that the drug will be available for the masses, including And so we'll continue to move in that direction because as I said, we've already taken care of the resources And the drugs that we need to do the Phase 3, but I do think we have positive data Given the environment that we're in right now and the fact that people are so fatigued, but they're also Realizing that this COVID thing is not going away, we have not turned the corner. We had this whole discussion that it looked great. Everything was opening up. I'm hearing some of the conferences are starting to get canceled again.
It just doesn't and we're stuck guys and we're only going to win this with a vaccine and a drug. So I do think That the move for funding will change dramatically as people step in with positive data.
The next question comes from Yi Chen from H. C. Wainwright. Please go ahead.
Thank you for taking my questions. The first question is, has the delta variant In any way affected the enrollment speed?
Yes. So I will tell you what I'll tell you what So the answer is yes, and let me tell you why. So when we started the clinical trial and you can go back and look and we said We opened the COVID-nineteen Phase 3. The United States contribution To the trial enrollment, we became incredibly anemic. And the reason we became incredibly anemic is because the rates of hospitalization and deaths kind of just disappeared.
And I have a person that I call at each of these emergency excuse me, each of these ICUs to see what's happening because miss is Crickets now. It looks like we've licked this thing. And I a week ago, I got a phone call from him saying, are you still working on this drug because we're getting slaughtered? So you just have to pick up the newspaper and see that it's gone the other way. So yes, The Delta variant is definitely helping us in the U.
S. Ex U. S, the Delta variant has already been out there. In Brazil and South America, the Brazilian variant is there. South America has been hit Extremely hard.
And so we're in those countries that continue to look like we did 6 months ago or 4 months ago. And then on top of that, you know that the Delta variant is coming. We're hearing from sites across the world that they're getting ready for the Delta variant. So they're seeing what happened in the United States and happening in the United States. So it's taken on an extreme urgency.
And as I had mentioned before, the way that sebizobulin works is that it works through interrupting microtubules And microtubules are responsible for pulling the virus from the surface into the nucleus where the coronavirus can replicate. And then once To make new viruses, the viruses have to be brought to the outside of the cell and released. And our drug works by Interrupting that, again, the microtubules, which are required to like a highway To bring the virus to the outside to sell and release it. So we don't care whether it's a blue car or a green car or a bus or a truck. The highway is gone.
You're not going to be able to move freely in and out. So we're comfortable that we're not going to have an issue like a very Specific antibody or a vaccine against the variant. And so I think that's going to be the major strength of our compound. So whether delta variant or lambda variant or some of these other variants that are coming through, it should not matter. And so I think that puts us in good footing to if we again if we replicate the Phase 2 results to have an effective A broad spectrum type of product.
Got it. And then also SavizapLink should perform the same among those patients that got COVID-nineteen regardless whether they are vaccinated or unvaccinated. Is that correct?
Yes. But in fairness, it's a good question. In fairness, it's and again, we're staying very, very close Because we're in the middle of this war, so to speak. If you're vaccinated, you tend to have a more mild outcome. And so, yes, you're seeing this strange breakthrough.
And what's happening is that the unvaccinated are the ones that are really bearing the brunt of this Part of the pandemic. And so if you're unvaccinated, then the Delta variant, you're going to get it and you're going to get it quickly, But still, it's the same situation, age, comorbidities and whole bed. And even though we're hearing that A lot of the young people are starting to show up because they didn't get vaccinated. About half these ICUs Are filled with the people that are still older age that didn't get vaccinated. So it's going to be plenty of People that we can try to help through our clinical trial, but more importantly, confirm with our clinical trial is Going to support clinical trials and replicate what we saw in Phase II.
So that's what I would say about the delta variant.
Does this slow down the enrollment for the Phase 3 prostate cancer trial?
No, we have not seen that. Interestingly, and I had made this comment before that with cancer patients, Cancer is scared. I mean cancer is metastatic, it's spreading and so people are scared. What we did see The first half when we had the Phase 1b and the Phase 2 ongoing is we did have a few patients that got a little bit nervous about So they're already in the trial that was enrolled, but they kind of we got a little delay here and there when we actually looked with a CT or an MRI, but that was more of a rare instance. Most people stayed on track.
And so now I can tell you that Subizobulin Phase 3 is open and enrolling and we're smack on target, if not a little ahead of target in terms of enrollment. So far, we have not seen that problem. And then get back to your point before about COVID-nineteen. There's no question we're getting a lot of inbound interest for In the U. S, where before, as I said, it was crickets.
We couldn't nobody was calling us. Nobody was returning our calls, but that's Changed dramatically. And so we're hoping that this will get us to the finish line in terms of enrollment.
Got it. Thank you.
Thank you. The next question comes from Kumar Raja from Brookline Capital Markets. Please go ahead.
Thanks for taking my questions. So with regard to the completion of enrollment by the end of the year for the COVID-nineteen trial, Does that take into consideration the recent uptick in cases? And also in terms of dosing either orally or By the nasogastric route, did you see any difference in efficacy based on like how the drug is being administered?
Right. So the I'm going to answer the second question first. So you're asking that with zebizobulin in COVID-nineteen being a Capsule, are we finding some problems administering the drug in an ICU setting?
It looks like they can be either administered orally or using the Nasogastric tube, so Yes,
yes, yes, exactly. So from that standpoint, we have not seen any problem because Patients need to get medicines and so we've because it's a capsule and it's a powder in the capsule, We've had no problem with administering either orally or through an NG tube. So that's been fine. As it relates to your question about the uptick and meeting our goals, in other words, we said we'd get this thing filled by the year end And then it went quiet in the U. S.
So I must admit, we were getting nervous because we have to have a certain U. S. Component and it went away. But now we're not nervous anymore because the U. S.
Has gone I mean, just look at the numbers, that was 108,000 new cases On average daily and the hospitalizations are picking up and 2 weeks after the deaths will start picking up. And so it's just I mean, we've gotten to a point now, now entering the 4th wave that we can always predict what's going to happen and it's not other than Vaccinated patient, the unvaccinated patient is kind of following the playbook. So I would say because of the uptick In cases that we're more likely to reach our goal.
Okay. And with regard to cybersecurity building as well as Bassam, With regard to Europe, what's happening in that front and also you talked a little bit about Pharmaceutical partnerships. So how should we think about it? Would it be like just like partnership for Europe or maybe a little bit of color on that?
Yes, sure. So, we're fortunate that we're going to be in a position in both our breast cancer and prostate cancer programs to be in Phase 3. And because you're in Phase 3, the question then becomes how are you viewing partnerships. And as you know, the back of the envelope would say that if you piecemeal the relationships, Then it will decrease the value of the opportunity for the global partner. And so what we're trying to do First of all, let me take a step back.
It's a bit of a lean prostate, we're only running in the U. S. And And the Innovus arm Phase 3 are test studies being done in the U. S. And Europe.
And we're also in the process of beginning to have some of the EMA discussions That we will need and as you know, EMA and with Brexit and everything, we have to understand Britain, so that's gotten a little strange. But our position right now It's to execute on the trial. The trials are open label, which means that we have a DSMB that can look at And we can continue to execute. But I think the most important thing for us to do is get these things filled, execute on them. We are in constant discussions with large pharma, medium sized pharma and small pharma across all our programs.
And but I think the way we're thinking of it, the biggest value that we're going to have as shareholders is to see if we can couple the good Phase 2 data with Some good Phase III data or some promise of Phase III data because it's open label. And to me, That feels like that's going to get us the best value. We have the resources, thanks to our shareholders' support, and we have the resources because of our base business. So I think we're in a very unique position that we can wait it out to get the best position and get the best deal. So but I do believe that at some point, Some of our programs are going to be best served with a pharmaceutical relationship, particularly on the commercial side.
And so we're doing exactly as you would expect us to do and that is having discussions with the largest and the smallest The largest, not the smallest, the largest and the medium, largest very global and the medium for piecemealing it. And but our preference is to keep the dialogue going till we get an offer we can't refuse.
Thanks so much.
The next question comes from Chris Howerton from Jefferies. Please go ahead.
Hey, good morning. Thanks so much for taking the questions, Mitch. I guess just 2 for me. First On the FC2, obviously, great to see the continued growth On that program, I guess, I'm curious if you could provide a little color as to, what is driving that growth currently and what is The expectations going into the second half of the year, perhaps like there is some seasonality to the trends that you might expect for contraception that Would be helpful for us to know about. So that's one question.
And then the second question, I guess maybe I missed it, but I'm just Wondering when we might expect the Phase 2 portion for the ongoing study in State cancer. Thank you.
Great. So, the first question had to do with, can we give you a little bit more color in terms of FC2 And I will tell you there is no seasonality. And as you can tell, it's also completely COVID-nineteen resistant. So the growth is being driven by and this is the beauty of it, we have telemedicine partners that are using Resources to market and sell and bring the women seeking birth control to their websites, their storefronts. It's an incredibly powerful way to go out there and market and sell because if we look at the number of FTEs that are supporting our U.
S. Business, it's like 3 or 4. And that's generating $30,000,000 $35,000,000 if you take out U. S. Public Global Public Sector.
And so it's incredibly efficient for a company like ourselves because then we can use those resources To put back in into the company. Now with that said, where we see the growth taking place is we're also Seeing that there's a very, very healthy reorder rate with the telemedicine. So it's not yes, it's a big blue ocean and people are starting, But they're coming back. And the reorder rate is very, very healthy. As you know, that will help the numbers from an exponential standpoint.
Also, we're in discussions with other telemedicine groups that are focused on birth control. And because this area is growing, New ones are showing up periodically that we've engaged with and hopefully, we'll pick up a few more of those. Every time we pick up a few more of those, that really increases the number of prescriptions that we're able to have. And then finally, we're going to look for other ways that we can take advantage of digital Internet channels to sell. And so we've been very, very pleased.
And the global public sector did fine. It was flat. It was a little bit more than flat. But boy, the U. S.
I think you're going to see all of the growth driven primarily by the U. S. Prescription business. And the ratios have flipped Where it used to be all public sector and then with a little bit of U. S.
Prescription, now it's going to from a revenue standpoint, from a profit It's all going to be primarily U. S. And so I'm happy to report, we do believe we're going to have a pretty good Year, I mean, this is we're entering we're 4 years into it. We're entering our 5th year of growth. And go look, it just seems Should be the same rate.
And that's very good for us because if we can maintain that, then we're paying for our clinical trials. And so that's and keep some real cash in the bank and not touch it. So this So that we can accelerate and stay on track and we can also Look at a big pharmaceutical partner and say, look, you're not going to wait us out. If you're going to give us a deal, give us the best deal possible. I think it's put us in good position.
So to give you color, there's no seasonality. COVID-nineteen is not affecting the growth. We're actively involved in business development to get additional telemedicine groups on board, and we also have a few things that we're doing to also enhance That's it. The business is growing. I'm happy to report.
The second question you asked has to do with the Ongoing Phase 2, the ongoing Phase 1b, it's completed, but we still have a couple of patients that Beyond 2 years, so that study is still going on. And in the Phase 2, we still have patients on it. And so I think what will happen is by year end, we'll be able to provide more color Because the longer we wait with these patients, the more accurate that we're going to get in terms of understanding the median progression free survival And some of the other data. So the Phase III is up and running. Urologists and medical oncologists are excited about the data they have seen so far.
We've reported updates. The updates are consistent that the agent has activity and in prostate cancer. That's why we're Excited to expand it into triple negative breast cancer because the preclinical data that we saw in prostates showed That we would have an effect on prostate cancer with no neutropenia neurotoxicity that played out clinically. And then we also have data in triple negative breast cancer That it should also translate clinically. And it will be interesting to see how that plays out when we go into our 2nd major indication.
So I would say look for data for the Phase 2, cebizobulin portion of the prostate cancer study towards the end of the year.
That's great. Okay. Thanks, Mitch. And I guess, I think we've discussed this in the past, but maybe if I can ask, Is there any information that you anticipate learning from either the ongoing Phase 1b, obviously the longer term Or within the Phase 2 patients that would anyway change your current Phase 3 plans or do you feel pretty solid about those Phase III designs at this point.
I think we feel very solid about the Phase III design. I think the reason we're continuing is because if I would have told On average, these patients are failing at 3 months, 3.5 months with an alternative antigen, we set the targeted agent, and we've got some patients In the Phase 1b, 12 months and now heading into 2 years, you would say that's pretty good. But that doesn't change our Phase III design. And then the Phase II is also providing us information that we use to help the Trial design assumptions and understanding the PFS and that kind of stuff. So I would say that we've learned what we needed to learn from the Phase Ib into Phase 2, that's the reason we went to Phase 3 because we felt at that point there was nothing new we're going to learn.
And we just can't take drug away and stop study, so we have to keep providing drug for the patients that are responding. So no, I think we're on Firm and solid assumptions for the Phase 3.
Very good. All right. Well, thank you very much for taking the questions. Appreciate it.
Chris, I appreciate it.
The next question comes from Alexandra Heller from Oppenheimer. Please go ahead.
Hi, good morning. Thanks for taking the questions and congrats on the quarter. Can Can you walk us through how you see RRP-one hundred fitting into the existing treatment landscape for hormone sensitive prostate Resisting cancer and then also your strategic plans for the asset. Thanks.
Yes. So FERU-one hundred, The beauty of this compound is that we were able to sit on the sidelines and watch how the field has evolved over the last 30, 40 years. And what we've learned is that medical castration is nobody wants surgical Castration and medical castration is the way to go. And interestingly, in this current landscape, with these new drugs that are allowing patients to live And we have several targeted agents and some of the chemotherapy and the PARP inhibitors. You're finding out that patients are living longer.
And in all instances, the base is androgen deprivation therapy. So when we went from 18 months, now you could be double or triple that, And they're on ADT the whole time. ADT is truly a chronic therapy. And for us to get involved with that with something that takes What we've learned, so what did we learn? We learned that the landscape now is that the agonists such as Lupin, AlloGuard and those kinds of medicines always when you give the injection, you have about 14 days, 2 weeks of high levels of testosterone Then come down and the castration levels are not as ideal.
And but yet, that's what we had and it worked. And then the antagonist came along and they shut off testosterone right away and the patient gets castrated right away and it turns out It also lowers FSH, which is thought to be important for cardiovascular events. I mean, Lupin, if you've had the Lupin type drug, My event showed this in their study that if you had a cardiovascular event and you were put on leukaride, You have a 1 in 5 chance of having another one. It's pretty high. So I would argue that if the GnRH antagonist were discovered first, That lupine and the agonist probably would never have been approved.
So I think this field is definitely moving to GnRH antagonist. Now in the flavors of GnRH antagonist, now the second challenge is how do you become part Of the medical care standard versus how do you disrupt the medical care standard. So the standard of care right now is the patient comes in every 3 to 4 months To get imaging and to see their doctor and to come in every month doesn't make sense and we know that because degarelix With a 1 month GnRH antagonist depot and it did not do well. And it didn't do well because it was not a good drug. People were kind of to castrate the patient by the way then add Lupron.
So people were worried about it. But the problem is, it didn't fit standard of care. And so the 3 4 month depots for Lupin, in that regard, are the standard of care. And so if you had a GNRH antagonist that was a 3 or 4 month depot, then you could be easily substitutable and become the preferred Choice because at the end of the day, compliance is really kind of important for this agent. And the reason compliance is important for this agent It's because you don't feel well when you get castrated.
You lose your libido. You become You develop change in body composition with fat and diabetes and loss of muscle mass and gynecomastia And hot flashes, so they're constantly looking for a way to get a drug holiday. And so they were in control, the patient was in control of With their own castration, then they may not be as compliant because they want that weekend break They want to feel good when the kids are there or whatever and testosterone pops back up, it's going to cause the tumor to spread and then the patient is going to have to get on to more Expensive drugs, like the antireceptor targeted agents and IV chemo. So we think the strategy for us Is that when the patient first develops advanced disease, metastatic prostate cancer That's hormone sensitive that the foundation, the drug that you start with should be our drug, should be VERU-one hundred. And because it's given every 3 months, potentially be given every 3 months, it would not buck the standard of care.
So doctors will be comfortable providing it knowing the patient will come back at the same time that they will usually see the patient and the same time that we usually image the patient. So you're not going to you're not changing standard of care and the urologist and the physician gets paid because they administer the medicine and they also Get a percentage of the product based on the AWP, so that doesn't change. And so our strategy And compliance is critical. Now the other thing that's changed also is that the data shows that it's unusual for a patient to get ADT monotherapy today. And so if somebody comes with hormone sensitive disease, they almost certainly can have it coupled with some of these other medicines.
And that's even another reason why you want to try to decrease the pill load and other things that the patient is taking And make it simple that there's one less thing they have to worry about every day. So I do think it's going to be very interesting. The other thing and that will be quiet Strategically, the worldwide market for ADT, androgen deprivation therapy, is about $2,600,000,000 and that's based on pricing for luprolide. GnRH antagonist are not priced like a generic leuprolide. And so the market is probably double, if not triple that.
And we just don't need to get much of that market to really move the needle. So this is a really attractive option and a real attractive Product for us. And basically, the way we would think of this product is this is the kind of product we could have regional License regional partners in Europe, Asia and maybe hold on to the U. S. Salve, because it's the foundation.
That's where you're going to go in and call on a urologist and medical oncologist about prostate cancer. And as you know, we have sebazobulin for patients that fail ADT and an interim receptor targeted agent would make a lot of sense. So that's how we're thinking about it, Alex.
Perfect. Thank you. That was super helpful. I appreciate it, Mitch.
Thanks.
Ladies and gentlemen, this concludes our question and answer session. I would like to turn the conference call back over to Doctor. Mitchell
I appreciate you all joining us on today's call, and I look forward to updating all of you on our progress in our next investor
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