Greetings. Welcome to Achieve Life Sciences First Quarter 2025 Earnings Conference Call and Webcast. At this time all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. As a reminder, this conference is being recorded. I would now like to turn the call over to Nicole Jones, Achieve Investor Relations. Thank you. You may begin.

Thank you, operator. Good morning, everyone, and thank you for joining us today. From Achieve Life Sciences, we are joined by Rick Stewart, Chief Executive Officer; Dr. Cindy Jacobs, President and Chief Medical Officer; Mark Oki, Chief Financial Officer. The management team will be available for Q&A following the prepared remarks. As a reminder, a replay will be available later today by using the information provided in the earnings press release issued prior to this call or visiting the Achieve website. Today's conference call will contain certain forward-looking statements including statements regarding the goals, strategies, beliefs, expectations and future potential operating results of Achieve. Although management believes these statements are reasonable based on estimates, assumptions and projections, as of today, these statements are not guarantees of future performance. Time sensitive information may no longer be accurate at the time of any telephonic or webcast replay. Actual results may differ materially as a result of risks, uncertainties and other factors, including, but not limited to the factors set forth in the company's filings with the SEC. Achieve undertakes no obligation to update or revise any of these forward-looking statements. Please refer to Achieve documents available on our website and filed with the SEC concerning factors that could affect the company. I'll now turn the call over to Rick.

Thank you, Nicole, and good morning to everyone and thank you for joining us on today's call. It's good to be able to say that Achieve is on track to submit the NDA for cytisinicline next month. It's been a long road to get us here and all internal resources are now focused on a successful NDA submission, acceptance and approval. Today's focus is primarily on the NDA submission. The role that cytisinicline can play as a treatment for nicotine dependence is immense. In the U.S. alone, over 29 million adults smoke cigarettes and 11 million adults vape. More than half want to quit, but fewer than 10% succeed because they have inadequate tools to help them overcome nicotine dependence successfully. Cytisinicline can change that and improve the probability and the opportunity to quit smoking and vaping with excellent efficacy and tolerability. If approved, cytisinicline will be the first new nicotine dependence drug in nearly 20 years, providing Achieve the opportunity to offer new hope to patients and their healthcare providers. We want to change the conversation, reminding the patient and medical community that nicotine dependence is a serious medical condition and needs to be treated as such. It's not about willpower, it's about science. Nicotine is the third most addictive drug after heroin and cocaine. We believe that cytisiniclin can be a part of the solution that help reframe this medical condition much like GLP-1s did for obesity. As Cindy will review shortly, we conducted a Scientific Advisory Board Meeting in March with experts in nicotine and tobacco cessation research to discuss cytisinicline. And in April, we were pleased to have our ORCA-3 clinical trial results published in JAMA Internal Medicine. Since our call in March, further progress has been made and Achieve now has over 100 patients with the FDA's required one year exposure to cytisinicline in the ORCA-OL open label study. The fact that so many patients remain on the study and continue on the drug is a testimony to cytisinicline's tolerability. Additionally, the Data Safety and Monitoring Committee completed another successful review of the ORCA-OL safety data and the trial is continuing as planned. With that, I'll turn the call over to Cindy to provide more details on the ORCA-OL trial and the overall clinical development and regulatory process.

Thank you, Rick. We continue to keep up the momentum in driving toward the completion of the NDA and we're in the final stages of submission preparation. We are taking the necessary steps and focus on ensuring that we will file a high quality NDA in June. So let's now turn to some recent highlights. In January, we hit a key milestone of having 300 participants in ORCA-OL with cumulative cytisinicline safety exposure data for a total of six months. This was the gatekeeping requirement to be completed to move toward the NDA submission and we're proud to have checked that box. Furthermore, in April, we reached the second requirement of having at least 100 participants with cumulative cytisinicline safety exposure data for a total of one year. Safety data for one year exposure is being monitored and will be finalized to include it in the standard 120 day safety update that we will be submitting during the NDA review process as agreed upon with FDA. As Rick mentioned earlier, just last week we had our third Data Safety Monitoring Committee review of the open label study safety data. The committee once again reaffirmed excellent adherence to cytisinicline treatment, reported no safety concerns and required no modifications to the trial conduct. We are thrilled with how quickly the ORCA-OL has progressed. Long-term studies are often difficult when it comes to retention of participants for one year treatment requirements, so it is encouraging to see so many participants choosing to stay on treatment. Of the 479 participants, who enrolled by the end of September last year, approximately 75% remain on cytisinicline in the study to date. We believe their willingness to remain on cytisinicline speaks to its favorable side effect profile and possibly efficacy benefit and is a strong signal of…

Thank you, Cindy, and good morning. As we work toward our NDA submission in June and continue laying the groundwork for a potential commercial launch in 2026, we're staying laser focused on managing our resources wisely and will continue doing so. As of March 31, 2025, the company's cash, cash equivalents and marketable securities were $23.2 million. Now turning to our statement of operations, our total operating expenses for the first quarter of 2025 were $12.9 million and the corresponding net loss was $12.8 million. We remain committed to strong financial discipline, making sure our spending directly supports our key priorities getting cytisinicline to market, building a foundation for our long-term growth and creating lasting value for our stockholders. With that, I'll turn it back to Rick for his closing remarks.

Thank you Mark and thanks to the entire Achieve team for their support and tremendous efforts in pushing the NDA over the goal line. We are on track and weeks away from reaching this milestone. Adding to Mark's remarks, cash management remains a priority for the company and we're being prudent with expenditures to ensure Achieve's cash runway is extended and the NDA remains the focus. Once the NDA is submitted, we anticipate receiving a 74 day letter from the FDA acknowledging the acceptance of our submission and from there we expect the NDA approval to take approximately 12 months from the date of submission. Treating nicotine dependence is our primary focus. And as I have mentioned before, cytisinicline can also help reduce the comorbidities and broader disease burden caused by smoking, particularly in conditions like COPD and asthma. Smoking is a major driver of multiple chronic conditions. For example, around 80% of people diagnosed with COPD develop the disease due to smoking and about 6 million of the 16 million Americans diagnosed with COPD currently smoke today. In our two Phase 3 trials, it was notable that smokers with COPD had higher quit rates on cytisinicline than those without the disease, a promising signal for COPD patients. Quitting can improve COPD treatment effectiveness plus reduce exacerbations and hospitalizations in COPD patients where smoking worsens symptoms and increases severity. These findings highlight cytisinicline's potential impact beyond just treating nicotine dependence alone. Achieve's mission driven team, together with support from key opinion leaders and patients in our clinical program, has built a strong foundation for success. By meeting both patients and physician needs, we are ultimately positioned to deliver long lasting value to stockholders. Thanks again for spending time with us this morning. We look forward to keeping you updated as we continue making progress in the months ahead. With that, I'll hand you back over to the operator to begin the Q&A.

Thank you. [Operator Instructions] Our first question is from Gary Nachman with Raymond James. Please proceed.

Thanks and congrats on the progress. So a couple of questions. First, how long before we see the full safety data from the long-term study? How will you present that? What will it be after you update the NDA with the one year data? And when you say 75% of the enrolled patients remain on treatment in the long-term study, what's the average duration for patients getting cytisinicline? And is that reflective of how it will be used in a real world setting? And then what were some of the key takeaways from the SAB meeting and how did that inform you for your filing and also for your commercial plans?

Thanks, Gary. I'll hand that one over to Cindy.

Sure. On the open label study, currently we are looking at completing all patients on the study that June, July, August and a few in September. So we'll have -- most of the subjects will have done over six months of treatment on that study. So we'll be looking at compiling that information and presenting it after the NDA obviously is submitted and after we have the 120 day safety data submitted in October. We'll be looking then at the end of this year into next year on what opportunities we'd have at a conference to present that data. We don't have anything set at this moment. And…

That's okay. That's helpful.

Yes, what was the next…

Yes, the SAB meeting.

Oh, the SAB meeting actually was really just interesting as far as discussing the applications that cytisinicline treatment could have from obviously individuals who want to stop smoking, but also in hospital situations where interactions with other medications this would be important since there is no nausea side effects. There were a lot of other avenues of interest on how cytisinicline and where cytisinicline could be used.

Okay, great.

If I can add something, I was…

Yes, please Rick.

Yes, Gary, I was actually at that meeting. And what was notable as far as I was concerned is the immense enthusiasm by the key opinion leaders for the drug. I think that as we expand our key opinion leader group, it's increasingly apparent that this -- obviously this is the first new nicotine dependence treatment in over 20 years, but an increasing recognition of the -- importance of both the efficacy and the tolerability of the drug. So, I think, the view of the key opinion leaders is that this is clearly going to be a drug that's going to make an immense impact on the nicotine dependence area.

Okay. So just to follow up, given that, what are some of your plans just in terms of pre-commercial efforts to continue to increase awareness and what cytisinicline could offer? And then just lastly, the status of any partnership discussions ongoing that could help provide some non-dilutive capital, whether looking at a comorbid COPD study like you talked about in the past, or maybe a commercial partner, U.S. or ex-U.S.? Thanks.

First part, I'll hand that one over to Jaime.

Sure, hi. Thanks for the question, Gary. Yes, so on the commercial readiness, what we're really doing at the moment is making sure we're focusing on our three key areas and one of those you mentioned is awareness. But availability and access are two of our priorities. The first one, making sure that we have drug in the channel. So we've made some great strides over the last several weeks to ensure that we are ready to actually sell the product. And then on the access side, we're continuing work on our pricing and payer strategy as well and beginning to start thinking about how our pre-information, our pre-approval information exchange conversations will go with those payers. On the awareness side, we're really again focused right now highly on the NDA and making sure that our PI and our label is what we will need to be able to support the claims that we hope to make to differentiate cytisinicline from current treatment options. Alongside that, we have some efforts to make with physicians to bring smoking cessation back to the conversation that they're having with their patients because for 20 years they've had no new options to offer them and so they're quite frustrated. And so, I think, it's really important that we get out prior to launch to make sure they know that there is going to be a new option and the same will apply when those patients are coming in to have conversations, they have something different to offer them. We spent a lot of time too on the awareness side just building out more of a marketing focus, but really how we're going to be communicating with physicians. So we're building out our digital roadmap, so that we have an omni-channel, very efficient platform that we can reach our customers and make sure that we're meeting them where they are and where they want to be finding information instead of trying to go to them in channels that they're not really receptive to hearing from pharma. So a lot of efforts on the commercial planning phase as well. And then Rick…

In terms of the second part of your question, Gary -- yes. Yes. Second half of the question, Gary. In terms of the strategic partnering, I mean, as far as nicotine dependence is concerned, we believe we can launch it in the U.S. alone. But your question was very pointed because as far as COPD and other kind of comorbidities are concerned, what we're doing at the moment is specifying exactly what we want from any kind of partnering with COPD, asthma -- or respiratory partners. I think it's really important to understand how cytisinicline can play a role in the COPD treatment regimen. We've been looking carefully at the anti-IL-33 drugs, some of which have got difficulties in actually having efficacy in smokers. So really where we are right now is we're specifying exactly what we believe is the opportunity in that space. And that is about how do you design a clinical study that's actually going to tease out the improvement in efficacy? So that's pretty much where we are at the moment. There are a number of potential candidates that we're in discussions with, but I think it's important to get the foundations of what we're trying to achieve in place first.

Okay, great. Thanks for all that color. Appreciate it.

Our next question is from Justin Walsh with Jones Trading. Please proceed.

Hi. Thanks for taking the question. I'd love to hear if you notice any changes in your interactions with the FDA.

Cindy, that one is for you.

At this point, we haven't seen any real changes. They're just as responsive as they have been. We have had some interactions obviously, as we get closer with the NDA submission and asking them over the last three to four months and their responses have been as normal. And so we have not seen any changes to date in the last few months.

Great. And maybe a quick follow up on that. I'm just curious if you see potential opportunities with the change in focus towards more chronic diseases, obviously your -- the specific FDA interactions have been sort of the same, but I'm just curious from a -- if you're sort of thinking from a philosophical perspective, if -- the current administration, if there's maybe some alignment with this type of product.

Well, I mean, obviously it's hard to speculate, but we would hope, because we are very proud of the efficacy and the safety data, that the ability to use cytisinicline to address chronic diseases like COPD and all of the cardiovascular diseases, smoking causes, will be a play as far as when they're reviewing and looking at all of our efficacy and safety data.

Great. Thanks for taking the questions.

Our next question is from Thomas Flaten with Lake Street Capital Markets. Please -- we lost him. So our next question is from John Vandermosten with Zacks Investment Research. Please proceed.

Great. Thank you and good morning, you guys. On the last call, you mentioned that you'd be discussing pricing with payers. I'm not sure if that happened yet. But if they have, have those conversations gone? And are there any products that they're using as comparison to determine pricing? And then also on that same topic, are there any pharmacoeconomic elements guiding the discussion?

Jamie, that's for you.

Good morning, John. Yes. So we did have some conversations with payers and we're just getting that information back and kind of calling through the data. Again, they're small samples and it's blinded research, so it's directional. But we won't really have strong perspective until we go out and have those tie exchanges and then also when we have our pricing set. But I mean, what we have been hearing is basically the same that we've heard historically is ultimately formulary placement and reimbursement will depend on our price. And that will help us understand where contracting will be required and what some rebate strategies might be. So there is clear value that's demonstrated with the product and they see that. It's just a matter of where they're going to place it, depending on where we set price. As far as comparators, of course they're going to be looking at what's available in the space, but there's clear differentiation from the generics. And there's also -- when we consider this patient population, these are patients who have tried these multiple therapies and likely the ones that are on the market. Again, mentioning that we haven't seen anything new in 20 years. And so, enforcement of stepping through those is going to be challenging because either patients have tried and failed or are unwilling to try. And so there's less issues around barriers to access from that perspective. And then did you have a third part of that question…

And then, yes, on the pharmacoeconomic economic studies, perhaps? I mean, obviously there's some long-term benefits that we all know intuitively. But are you going to do anything there that quantifies it for 2025?

Yes. I don't think there's a need to repeat studies that have already been conducted that show smoking causes these chronic diseases that are very expensive. There is so much literature out there that we can leverage. I think there is value in showing our biggest value proposition that we believe is that increased adherence is going to lead to compliance, which is going to improve outcomes. And I think that's what we need to be able to make a strong argument in a case for. So instead of spending any resources on showing that chronic diseases caused by smoking are expensive, as we know they're costing the U.S. healthcare system over $300 billion a year that data is strong and it exists. And we've done analysis and kind of a HuR gap analysis to show that that data is out there. We're going to spend our time and energy on specifically how cytisinicline can improve the results that they are seeing with current treatments or not seeing with current treatments.

Okay. And there are a number of, I don't know, I guess you call maybe digital first commercialization companies out there like CliniOps and Indegene. Can they take up part of what you were doing? Maybe focus on some of the areas where they're more generic and they have leverage and then you focus on the areas where you have a competitive advantage. Is that something you might take advantage of? Or can you just do it all internally without using something like one of those guys?

We will be heavily relying on and have been on our agency partners to help us implement our strategy. So we've been working with Omnicom primarily and they have a strong digital company called Credera that works across all industries and sectors and they have helped build out a highly strategic and advanced model of what a digital launch roadmap would look like, what our data requirements will be, and how AI will help to inform every stage of the process, from improving our targeting strategies to improving the time and the efficiencies gained with the development of content and the measurements of whether or not the content is resonating with our target audiences. So we are definitely partnering and leveraging external resources very heavily.

Okay, sounds like you get some real time data there as you're doing the process. And last question for me is you should be assuming that the products approved on time. About a year from now you'll start commercialization or you'll be free to start it. Do you think you'll start right as soon as the approval is given? Or will you take a little time to kind of set things up? I just was wondering kind of the timing from a model perspective on how we should anticipate first sales to fall in next year.

Yes, I think it's fair to assume a company of our size is going to need a minute following approval to get drug in channel. So it's going to take us a little bit of time and I'm not sure we can speak right now exactly to how much time, but we certainly want to have a strong launch as close to the timing of approval as possible. But again, we'll probably be able to give some further instruction and direction on that as we get closer.

Great. All right. Thanks, Jamie. Appreciate it.

You bet.

There are no further questions at this time. I would like to turn the call back over to Rick Stewart for closing remarks.

Thank you, operator. We'd once again like to thank you for joining Achieve's Q1 call. It's clear that cytisinicline and Achieve can have a significant impact on the public health narrative in the U.S. today by providing patients and physicians with new, improved tools to address the nicotine dependence crisis in the U.S. The near-term NDA submission is a major milestone for Achieve for patients, for physicians and for our stockholders. And we are confident of driving forward to a product launch in 2026. Thank you for joining the call.

Thank you. This will conclude today's conference. You may disconnect your lines at this time and thank you for your participation.