Aquestive Therapeutics, Inc. is a pharmaceutical company advancing medicines to solve patients' problems with current standards of care and provide transformative products to improve their lives. Aquestive is developing pharmaceutical products that deliver complex molecules through alternative administrations to invasive and inconvenient standard of care therapies.

Business Overview

Aquestive has five licensed commercialized products which are marketed by its licensees in the U.S. and around the world. Aquestive is the exclusive manufacturer of these licensed products. Aquestive also collaborates with pharmaceutical companies to bring new molecules to market using proprietary, best-in-class technologies, like PharmFilm®, and has proven drug development and commercialization capabilities.

Aquestive is advancing a product pipeline for the treatment of severe allergic reactions, including anaphylaxis. Aquestive's lead product candidate,

Anaphylm™ (epinephrine) Sublingual Film

, is the first and only non-device based, orally delivered epinephrine product candidate that has shown clinical results comparable to auto-injectors for the emergency treatment of allergic reactions. Anaphylm is currently undergoing clinical development, with Aquestive expecting to file the NDA with the FDA before the end of 2024.

Aquestive has also developed a product pipeline focused on treating diseases of the CNS, including

Libervant™

, a buccally administered soluble film formulation of diazepam. Libervant was recently approved by the FDA for the acute treatment of intermittent, stereotypic episodes of frequent seizure activity in patients with epilepsy between two and five years of age. Aquestive is now focused on expanding market access for Libervant in this patient population.

In addition to its proprietary pipeline, Aquestive has a portfolio of licensed commercial products, including Suboxone®, Exservan®, KYNMOBI®, Zuplenz®, and Sympazan®. These licensed products generated $50.6 million in revenue for Aquestive in 2023, with Suboxone accounting for the substantial majority of this revenue.

Financials

Aquestive's financial performance in 2023 was mixed, with annual net income of -$7.87 million, annual revenue of $50.6 million, annual operating cash flow of -$6.38 million, and annual free cash flow of -$7.38 million. Aquestive's quarterly results for the first quarter of 2024 showed a net loss of $12.8 million, with total revenues of $12.1 million, up 8% from the same period in the prior year.

The increase in first quarter 2024 revenues was primarily driven by higher manufacture and supply revenue, up 8% to $10.5 million, and a 23% increase in license and royalty revenue to $1.1 million. This was partially offset by an 11% decrease in co-development and research fees to $0.4 million. The increase in manufacture and supply revenue was due to higher Suboxone and Sympazan volumes, partially offset by lower Ondif revenue.

Research and development expenses increased 67% to $5.9 million in the first quarter of 2024, primarily due to the continued advancement of the Anaphylm program. Selling, general, and administrative expenses increased 43% to $10.7 million, driven by higher personnel costs, one-time severance costs, and increased share-based compensation.

For the full year 2024, Aquestive is guiding for total revenues of approximately $48 million to $51 million and a non-GAAP adjusted EBITDA loss of approximately $22 million to $26 million. This guidance excludes any revenue or expenses related to Libervant following its recent FDA approval for patients aged 2 to 5.

Liquidity

Aquestive's balance sheet remains strong, with $95.2 million in cash and cash equivalents as of March 31, 2024. This cash position was bolstered by a $75 million underwritten public offering completed in March 2024, as well as continued utilization of Aquestive's at-the-market (ATM) facility, which provided an additional $12 million in the first quarter.

Aquestive's liquidity position provides runway into 2026 to advance the development and commercialization of its product pipeline, including Anaphylm and Libervant. Aquestive is also reviewing its existing collaborations to prioritize its focus on the most promising products from a long-term profitability perspective.

Recent Developments

Anaphylm, Aquestive's lead product candidate, is a significant opportunity for Aquestive. The product has shown promising clinical results, with data demonstrating biocomparability to auto-injectors for the first 30 minutes following administration. Aquestive is currently conducting additional supportive studies for Anaphylm and expects to have clinical data from these studies by the second quarter of 2024. Aquestive plans to hold a pre-NDA meeting with the FDA in the second half of 2024 and file the NDA before the end of the year.

The commercial opportunity for Anaphylm is substantial, as epinephrine is the standard of care for the treatment of anaphylaxis. Aquestive believes the oral film formulation of Anaphylm provides a differentiated and preferred option for patients and caregivers compared to the currently available auto-injector products. Aquestive is actively preparing for the commercialization of Anaphylm, including building out its distribution and market access capabilities.

Libervant also represents a significant opportunity for Aquestive. The product was recently approved by the FDA for the acute treatment of intermittent, stereotypic episodes of frequent seizure activity in patients with epilepsy between two and five years of age. This patient population previously only had access to a rectal gel formulation, making Libervant an important new treatment option.

Aquestive is now focused on expanding market access for Libervant in this patient population. Aquestive is evaluating whether to commercialize Libervant independently or seek a partnership to maximize the product's potential. Libervant generated $5.2 million in revenue for Aquestive in 2023.

Risks and Challenges

In addition to its proprietary pipeline, Aquestive's portfolio of licensed commercial products, particularly Suboxone, continues to be an important revenue driver for Aquestive. Suboxone, a sublingual film formulation of buprenorphine and naloxone for the treatment of opioid dependence, accounted for the substantial majority of Aquestive's $50.6 million in total revenue in 2023.

While Suboxone remains a valuable asset, Aquestive is mindful of the potential for continued erosion of this revenue stream as generic film-based products continue to penetrate the market. Aquestive has filed patent infringement lawsuits against certain companies relating to generic film-based products for buprenorphine-naloxone.

Aquestive's other licensed commercial products, including Exservan, KYNMOBI, Zuplenz, and Sympazan, also contribute to Aquestive's revenue stream. In 2023, these products generated a combined $10.4 million in revenue for Aquestive.

Outlook

Aquestive's financial position and liquidity remain key areas of focus. Aquestive's cash and cash equivalents of $95.2 million as of March 31, 2024, provide a strong foundation to advance its pipeline and commercial initiatives. The recent $75 million underwritten public offering, as well as continued access to Aquestive's ATM facility, have further strengthened Aquestive's balance sheet.

Looking ahead, Aquestive's success will hinge on the continued advancement of its pipeline, particularly Anaphylm and Libervant, as well as Aquestive's ability to effectively manage its base business, including the potential decline in Suboxone revenue. Aquestive's guidance for 2024, which excludes any revenue or expenses related to Libervant, reflects its focus on executing its development plans while maintaining financial discipline.

Conclusion

Overall, Aquestive Therapeutics is a pharmaceutical company with a diverse portfolio of licensed commercial products and a promising pipeline of proprietary product candidates. Aquestive's innovative delivery technologies, such as PharmFilm, have the potential to address unmet patient needs and drive long-term growth. As Aquestive continues to execute on its strategic priorities, investors will be closely watching the progress of its lead programs, Anaphylm and Libervant, as well as Aquestive's ability to effectively manage its base business and financial position.