ARS Pharmaceuticals targets renewed growth in 2026 as neffy adoption accelerates and new global launches begin

Earnings Call Insights: ARS Pharmaceuticals (SPRY) Q3 2025

MANAGEMENT VIEW

* Richard Lowenthal, Co-Founder, President, CEO & Director, highlighted a pivotal quarter for ARS Pharma, stating "U.S. net product revenue for neffy grew again quarter-over-quarter, reaching $31.3 million in Q3, representing a 2.5-fold increase from the prior quarter and exceeding consensus expectations of $28.3 million." He emphasized strong growth in new patient starts and overall demand, with surveys indicating durable utilization and recurring refill behavior. Lowenthal also noted that real-world data from the neffy Experience Program, covering 554 patients, demonstrated that about 90% of anaphylaxis cases were effectively treated with a single dose, in line with injection-based products.
* Lowenthal addressed the discrepancy between IQVIA script data and neffy’s actual performance, explaining that IQVIA excludes several key sales channels, leading to underreporting of market share. He discussed temporary market share pauses during the back-to-school season due to limited physician time, but expects resumed growth in Q4 and a return to quarter-over-quarter growth in 2026, despite anticipated Q4 seasonality-driven sales decline. He announced the launch of the "Get neffy on Us" program to remove barriers and accelerate adoption.
* International expansion was highlighted, with launches in Germany and the U.K. showing strong early uptake, and approvals expected in Japan, Canada, and China in the coming quarters. Lowenthal said, "We expect that as these launches begin, they will start to contribute to the total revenue and cash proceeds in the second half of next year as distribution scales across partner regions."
* On clinical development, enrollment in the Phase IIb urticaria trial is ongoing, with top-line data expected mid-2026, representing a significant label expansion opportunity.
* Lowenthal announced securing a $250 million term loan facility, drawing $100 million initially to accelerate commercial investment and maintain a strong balance sheet, ending Q3 with $288 million in cash and equivalents.
* Eric Karas, Chief Commercial Officer, reported an 85% increase in neffy prescribers since August to over 18,000, with new prescribers showing faster uptake. He said, "Market share amongst new prescribers is at 10.3%, outpacing existing ones with the same call frequency, signaling faster uptake as new doctors benefit from refined messaging, an easier prescribing experience and growing real-world evidence."
* Kathleen Scott, Chief Financial Officer, stated, "We recorded total revenue of $32.5 million. Our U.S. net product revenue for neffy in Q3 was $31.3 million, representing a near 2.5-fold increase from the prior quarter." She reported R&D expenses of $2.8 million and SG&A expenses of $74.8 million, with a net loss of $51.2 million or $0.52 per share. Scott added, "Our current cash position is expected to be sufficient to achieve cash flow breakeven without additional equity financing while maintaining the resources needed to fully capitalize on the U.S. commercial opportunity for neffy and benefit from the continued U.S. growth and expanding international revenue."

OUTLOOK

* Management expects Q4 sales to decrease from Q3 due to seasonality, with a return to growth projected in 2026 as market share and prescription volumes rise. Lowenthal said, "Then as we move into 2026, we expect to return to quarter-over-quarter growth as both market share and overall prescription volumes rise in parallel."
* Approvals and launches in Japan, Canada, and China are anticipated in the coming quarters, with revenue contributions beginning in the second half of next year.
* Gross to net retention is expected to remain in the low to mid-50% range.

FINANCIAL RESULTS

* Total revenue for Q3 was $32.5 million, with U.S. net product revenue for neffy at $31.3 million. Supply revenue from partners was $1.1 million, and $0.1 million in royalties from ALK related to EURneffy in Germany.
* R&D expenses were $2.8 million, and SG&A expenses were $74.8 million, reflecting investment in DTC and sales efforts. Gross to net retention increased modestly from Q2.
* Cash, cash equivalents, and short-term investments totaled $288.2 million as of September 30, 2025, supported by a new $250 million term loan facility.
* Net loss for Q3 was $51.2 million or $0.52 per share.

Q&A

* Lachlan Hanbury-Brown, William Blair: Asked about Q3 performance versus expectations and drivers of new prescriber share. Richard Lowenthal responded that results met internal expectations, and emphasized learning from summer challenges, shifting focus to the "Get neffy on Us" program. Eric Karas added that new prescribers benefit from focused messaging and real-world data, with existing high-tier prescribers also expanding share.
* Hanbury-Brown: Inquired about institutional sales volume and economics. Lowenthal declined to elaborate, citing inconsistency and early-stage efforts to market to institutions.
* Joshua Schimmer, Cantor Fitzgerald: Asked about prior authorization requirements and promotion of online prescribing. Lowenthal described DTC integration and outreach, noting, "almost all insurers will tolerate 2 boxes in 1 prescription." Karas said about 50% of all payers require prior authorizations, with 57% of commercial prescriptions not requiring PA.
* Roanna Clarissa Ruiz, Leerink Partners: Requested details on inventory levels and IQVIA channel capture. Lowenthal stated distributor inventory is managed at 15–20 days and adjusts seasonally. Karas estimated prescription distribution is about 55% retail, with IQVIA inconsistently capturing data.
* Andreas Argyrides, Oppenheimer: Asked about progress with payers, especially CVS Caremark, and outlook for Q4 and next year. Lowenthal said new proposals are in with major PBMs, expecting progress in the first half of next year, and reiterated Q4 sales would likely be below Q3 due to seasonality.
* Kevin Holder, ROTH Capital: Asked about U.K. launch adoption and pediatrician market penetration. Lowenthal noted early excitement and seamless reimbursement in the U.K., expecting adoption similar to Germany. Karas reported expansion to about 9,000 pediatricians and 20,000 physicians overall.
* Unknown Analyst, Raymond James: Asked about the impact and demographics for the virtual prescriber program. Management expressed strong positive feedback from physicians and caregivers, expecting it to reduce barriers and expand access.

SENTIMENT ANALYSIS

* Analysts maintained a positive to slightly cautious tone, probing on sustainability of growth, payer access, and channel performance, while seeking clarity on seasonality and institutional sales.
* Management’s tone was confident in prepared remarks, shifting to pragmatic and slightly defensive when addressing Q4 expectations and data limitations. Lowenthal used phrases such as "we are confident in our path towards long-term growth and profitability" and justified performance dips as seasonal or data-related, indicating resilience and adaptability.
* Compared to the previous quarter, both management and analysts showed heightened focus on payer access and sustainability of growth, with analysts probing more on operational execution and new channel initiatives.

QUARTER-OVER-QUARTER COMPARISON

* Revenue growth accelerated sharply from $12.8 million in Q2 to $31.3 million in Q3 for neffy’s U.S. net product revenue, a near 2.5-fold increase, while the previous quarter highlighted a 64% sequential increase.
* Gross to net retention increased modestly from Q2, with expectations to remain stable.
* SG&A expenses rose from $54.3 million to $74.8 million, reflecting heavier DTC and commercial investments.
* Focus shifted from initial payer coverage and DTC launch in Q2 to operational execution, mitigation of seasonal slowdowns, and the launch of the "Get neffy on Us" virtual prescriber program in Q3.
* Analyst questions in Q3 centered more on the durability of growth, operational levers, and access expansion, compared to Q2’s focus on initial uptake and coverage ceiling.
* Management’s confidence remained strong, but Q3 remarks included more explicit discussion of mitigating seasonal headwinds and capitalizing on new channels.

RISKS AND CONCERNS

* Management highlighted seasonality in the epinephrine market, expecting Q4 sales to decline from Q3.
* Challenges with incomplete IQVIA data tracking and inconsistent institutional sales were noted.
* Payer access remains a gating factor, with ongoing efforts to secure broader coverage and reduce prior authorization requirements.
* Inventory adjustments by distributors may impact quarterly sales visibility.
* Management is monitoring the impact of new commercial programs to ensure sustained adoption.

FINAL TAKEAWAY

Management underscored that Q3 2025 marked a true inflection point for ARS Pharmaceuticals, with neffy’s rapid growth in U.S. revenue, expanded prescriber base, and strong momentum in international markets. Despite expected Q4 seasonality, the company anticipates renewed growth in 2026 as new channels like the "Get neffy on Us" program drive adoption and as launches in Japan, Canada, and China begin to contribute. Management remains focused on expanding access, sustaining market share gains, and progressing clinical development, confident that the current strategy and financial position will support long-term growth and profitability.

Read the full Earnings Call Transcript [https://seekingalpha.com/symbol/spry/earnings/transcripts]

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