Greetings, and welcome to the KORU Medical Systems Fourth Quarter 2025 Earnings Call. [Operator Instructions] As a reminder, this conference is being recorded. It is now my pleasure to introduce Louisa Smith, Investor Relations. Please go ahead.

Thank you, operator, and good afternoon, everyone. Joining me on the call today are Linda Tharby, President and CEO of KORU Medical Systems; Tom Adams, Chief Financial Officer; and Adam Kalbermatten, Chief Commercial Officer. Earlier today, KORU released financial results for the fourth quarter and full year ended December 31, 2025. A copy of the press release is available on the company's website. I encourage listeners to have our press release in front of them, which includes our financial results and commentary on the quarter. Additionally, we will use slides to support further commentary in today's call, which are also available on the Investor Relations section of our website. During this call, we will make certain forward-looking statements regarding our business plans and other matters. These comments are based on our predictions and expectations as of today. Actual events or results could differ materially due to risks and uncertainties, including those mentioned in the associated press release and our most recent filings with the SEC. We assume no obligation to update any forward-looking statements. During the call, management will also discuss certain non-GAAP financial measures. You will find additional disclosures, including reconciliations of these non-GAAP measures with comparable GAAP measures in our press release, the accompanying investor presentation and SEC filings. For the benefit of those listening to the replay, this call was held and recorded on Thursday, March 12, 2026, at approximately 4:30 p.m. Eastern Time. Since then, the company may have made additional comments related to the topics discussed. I'd now like to turn the call over to Linda Tharby, President and CEO. Linda, please go ahead.

Good afternoon, everyone, and thanks for joining us today. Before I provide further detail on our fourth quarter and full year performance, I want to take the opportunity to comment on the announcement of my retirement as was press released earlier today. After 5 fulfilling years, I have made the decision to retire and will resign as CEO of KORU Medical effective June 30. This has been one of the most meaningful chapters in my career, and I am proud of what we have built together, including the strength of the business, our growing leadership position in large-volume drug delivery and an exceptional team that will continue to maximize KORU's potential and move the growth strategy forward. My family and I are ready to embrace the next chapter of my life, and I will turn my focus to Board and advisory activity. This transition has been thoughtfully planned by the Board, and I'm very pleased to announce that Adam Kalbermatten, our Chief Commercial Officer, has been selected as my successor. When Adam joined KORU in 2025, it was immediately clear he was a natural fit, not just for the CCO role, but for the potential to lead the company as a whole. Adam brings strategic discipline, commercial leadership and a proven track record of creating shareholder value. He has spent his entire 20-plus year career in drug delivery, spanning large and small med tech companies and including a CEO role, where he led an effective turnaround and growth strategy that resulted in a successful acquisition by Becton, Dickinson. The Board's confidence in Adam is grounded both in him personally and in the strength of the broader team beside him. With over 115 years of combined med tech and pharma experience across the executive leadership team. KORU has the strategic depth…

Thanks, Linda, and good afternoon, everyone. We are pleased with another strong quarter of revenue where we delivered $10.9 million, representing 23% year-over-year growth. This marks 3 consecutive quarters of greater than 20% revenue growth, a reflection of the momentum we've built across the business. Breaking down the performance by business. Domestic Core grew 18% year-over-year, driven by the SCIg market, which grew between 8% to 10% in the quarter. New KORU patient starts and market share gains, resulting in higher pump and consumable volumes. International Core grew 71% year-over-year, fueled by new patient starts and increased penetration into established European markets. Prefilled syringe conversions were a significant driver and we expect this to remain a tailwind as additional markets convert. Our PST business decreased 30% year-over-year. This business is inherently variable given the milestone-based nature of revenue recognition. The decrease reflects timing of contract milestones, for work completed and does not reflect the change in the activity level of our collaboration portfolio, which as Linda just described, continues to grow. For the full year, we delivered revenue of $41.1 million, representing 22% growth over the $33.6 million we reported in 2024. Domestic Core grew 11% for the full year driven by SCIg market growth and new account share gains that increased consumables and pump volumes. Accounting for the dynamic that occurred with our international distributors going back to the U.S. which we discussed in the third quarter call, underlying growth would have been 14% for the full year. International Core grew 80% for the full year, driven by strong SCIg market growth our growing footprint in European markets and entry into several new geographies. Accounting for the international distributor sales dynamic, underlying growth would have been 73% for the full year. Finally, PST declined modestly. Again, due to the…

Thank you, Tom. I want to close with a few thoughts on key milestones in 2026 and our broader market opportunity. . We started the year off strong. In our Domestic Core, we have gained the UCB RYSTIGGO 510(k) clearance and our Roche Phesgo 510(k) application submitted on time in December, giving us two new non-IG drugs currently moving to commercial potential in 2026. We also have our next-generation pump, the FREEDOM60 expected to have 510(k) and MDR submissions this year. The Phase II Flow Controller 510(k) submission is projected for a global submission either in late 2026 or early 2027. Internationally, we have achieved MDR clearance of our FREEDOM60 with prefilled syringe compatibility, and we have now begun to ship that product into the EU market, anticipating prefilled conversions in several EU markets. On our efforts to add new drugs to our label, we have signed 2 of our 4 new collaborations and anticipate 2 additional 510(k) submissions this year for deferoxamine and vancomycin. In closing, I want to step back and frame why we believe KORU is well positioned, not just for 2026, but for the years ahead. This slide references the strong foundation that we have built for our business, some of our recent accomplishments and finally, where we believe we are headed. On the left, you'll note some of the foundational aspects that make KORU an attractive opportunity. We operate in a large and growing market for subcutaneous drug delivery with approximately 95 large volume drugs in development by major pharmaceutical companies. We have a leading position in the U.S. market that is growing 8% to 10%, where we consistently outperform market growth rates. We have significant momentum with international expansion with much more runway to grow and gain share. Underpinning this is a recurring revenue…

[Operator Instructions] Our first question is from Frank Takkinen with Lake Street Capital Markets.

Great. First off, Linda, congratulations on all you have achieved. We're certainly sad to see you go, but look forward to working closer with Adam and the rest of the KORU team, I wish you the absolute best in your next chapter. I was hoping to start with some questions on OUS, maybe two questions. . First, on FREEDOM60, maybe talk about what this product does for you in that market? How much of the market might this open up? And then two, you've spoken about, I want to say it's the 5 geographies that you plan to enter, how should we think about the cadence of those geographies and the progress so far.

Frank, and thank you. It has been an extreme pleasure working with you and the broader Lake Street team. Clearly, very confident as we think about Adam stepping into role and the broader team that surrounds him. So on your questions on the FREEDOM60 and the opportunity that lies ahead of us. Maybe I'll just start with the broader opportunity we're going after here is a $50 million total addressable market in Europe. We were very successful in 2025 in moving our share position from a 10% to a 20% share, but obviously, if you position that share closer to our 60% U.S. share, you see the magnitude of the opportunity we have in front of us in Europe. . So most of that opportunity and share gain in 2025 was driven by a successful prefill conversion in a major market in Europe, and the pharma partner that we're working with has plans to roll this out in several new markets over the course of the coming year. And the 5 geographies you referred to are not new markets for us, but there are markets we're in today, but with fairly low penetration, and we see the opportunity in prebills to really grow that market significantly. So what we see today is that we have our second market. We've started our year off strong in '26 with our second market that's really going live now with this prefill launch, and we expect to see likely a new market being added 1 to 2 every quarter as we move through the year. I think the last part of the question was just the FREEDOM60 and the new approval. Very excited about that because now we have 2 pumps, both our 60 and our Edge that are both approved. We required some slight modifications to our FREEDOM60 and an update to our IFU, we just received approval on that in the fourth quarter of '26. So great news for us. We've now just started distributing that new product into the market today. And of course, what comes at the back end of the year is our FREEDOM360, which is our pump that will work for all prefills. So hopefully, that got all of those questions.

Perfect. Maybe just for my second one, Tom, a little more composition of the guide would be good color. I heard ramping revenue throughout the year as some of these initiatives progress, but maybe how much contribution from U.S.? How should we think about that growth rate, OUS? And then any cadencing color you'd like to provide would be great, too.

Frank, thanks for the question. Yes. Great. So we're continuing to see momentum coming into Q1 after a record Q4. So that's very strong for us, particularly on the international side. So as mentioned earlier, prefill still is a driver of that market. So we continue to see that progress. I would say from -- on the international side, you will see a step up in the back half of the year, based on what Linda just mentioned in some of those countries going online for prefills. And then on the U.S. side, I think that's slow and steady. I mean you've seen the last couple of years, a pretty steady growth rate on the U.S. side. And then, of course, as we get further along into the year, you will see more growth from some of those 5 tenant approvals that are upcoming. And then yes, then we'll just continue to grow up there. And then on the PST side, you'll see consistent revenue trajectory like you've seen in the last couple of years.

Our next question is from Chase Knickerbocker with Craig Hallum Capital Group.

I just want to echo Frank's comments. Obviously, we wish you the best, Linda and all your future endeavors. I appreciate everything you've done there, which is quite a bit. So -- and obviously, congrats Adam on the new role as well. Maybe just first for me on the Domestic side. 18% growth is obviously substantially above the market. Can you give us some sense for what's happening in the market is allowing you to take so much share? And maybe 1 and then 2 on that front, how should we think about the opportunity for further share gains in 2026 after a pretty strong year in '25?

So thanks, Chase, for the well wishes. I appreciate it, and you and the Craig-Hallum team have been great. So first, yes, very proud of the U.S. growth in the fourth quarter. We continue to see new account gains overall on that business. And of course, we had the return happen of the distributor in international that move back to the U.S. So as we projected, all that business is now back, which is great news. I'll give it to Tom, maybe to add some specifics on the U.S. and what we might see in '26.

Yes. So in '26, as I mentioned, we continue to see a strong SCIg market, and we expect that to continue to grow throughout the course of the year. And then, as I just mentioned to Frank, as we continue to receive approvals for new drugs on label throughout the year, we expect some growth off of that as well. So we will continue to see that revenue grow sequentially in the U.S. market. .

Maybe on that front, on the novel therapies that we're adding, particularly in the second half. Can you give us a sense for kind of the magnitude of impact there? And then just second for you, Tom. If we think about EBITDA in the year, obviously, a little bit kind of open-ended on guidance. Can you give us a sense for how much operating leverage we should kind of expect from you guys in '26? Obviously, low single-digit OpEx growth in '25 was quite a bit of operating leverage. Can you just give us some goalposts as far as what we should be expecting for OpEx growth in '26?

So maybe I'll just start with novel therapies and the overall impact that we're thinking about. And what I would say is we have changed its name to pharmaceutical services and clinical trials. So we're still figuring that out here, but now we're calling that our PSD business. So obviously, in terms of overall revenues, these revenues are milestone-based based upon the overall innovations and clinical trials that we're servicing. So that number I would suggest has always been around where it's been historically. So not to expect anything new there, but obviously, very excited about the two new deals that we signed this past quarter, and maybe I'll turn it over to Adam just to talk a little bit more about that.

Yes. Thanks, Linda. So over the last quarter, we signed two new deals with pharmaceutical companies. One of them is a nephrology drug that's in Phase III. We're really excited about that. The other one is molecule in early Phase I. It's a multi-indication drug. In total, this represents approximately 3 million annual infusions between the two of them. So really excited to add those into our pipeline and get the work going on the feasibility side to keep these moving through the pharmaceutical pipeline and into our future prospects.

Thanks, Adam. And I think before I just turn it over, I think what you were looking for as well here, Chase was the new drugs on label, and what we see in the near term with RYSTIGGO, and then the other two drugs vancomycin and deferoxamine. Overall, I think a couple of things. First of all, that many of these drugs are administered in infusion clinics. So that is a new entry point for us, and we've already started to hear some of our customers say, "Hey, can we try these other drugs." So we see that as a broader opportunity, one which I'm not going to put a number on today. But I think the numbers that we've mentioned in the past for these 3 drugs in total, somewhere between $0.5 million upwards of $0.5 million of opportunities. We've got a modest number today knowing that two of those drugs are not approved yet. And so we'll refresh the models as time goes on, and we learn more and see how many new accounts we can gain. I would also say on RYSTIGGO, we already had a large portion of that business off label. So excited for the entry. We're already hard at work there, and we'll have more to report as quarters go on. And Tom, a question on the operating leverage.

Yes. Just on the EBITDA, Chase, we continue -- last year was a great year for us. We had adjusted EBITDA positive. We're excited about that. We're excited to hit cash flow positivity. And as I mentioned in the guidance, we will be positive adjusted EBITDA once again and continuing to grow from there as well as cash flow positive for the full year, not just in operations, but for the full year. So we're excited about that again. We will continue to see leverage because our business model allows it with the way our SG&A is set up in our business. So we'll get more specific on that as the year funds through, but we expect to continue to progress on those fronts.

Our next question is from Caitlin Roberts with Canaccord Genuity.

Linda, I'm so sad to see you go, but you're truly an inspiration to women and meta-like in the industry. So thank you so much. I guess just starting with RYSTIGGO, how are you thinking about the go-to-market model here in infusion clinics? And how does this really position you to penetrate the oncology opportunity more quickly when cleared?

Right. So first, Caitlin, thank you so much. The Canaccord team has been great. And you personally, right back at you in terms of women in leadership, and thank you to all the men who support us in doing what we do. So getting to the overall RYSTIGGO opportunity and how that entry into infusion clinics, I would say, broadly, what we discussed in the earnings was that RYSTIGGO, we see is about 20,000 infusions in the U.S. here today, going to about 100,000 infusions over the course of the next 5 years and even a bigger opportunity globally, which we're at early stages of looking at today. . In terms of infusion clinics and our entry strategy, fortunately for us, this channel today is many of the same specialty pharmacies we deal with are dealing with this channel. I'm going to let Adam say a few words in a moment relative to he's thinking about anything broader relative to our infusion clinic entry, but I would certainly say that oncology infusion center, which I understand can be a little confusing, but oncology infusion centers are different than ambulatory infusion centers and sometimes there's an overlap. So we see this as good for our pending oncology opportunity. It gives us a leap and head start, and then a broader opportunity once we get approval in oncology. Adam, I don't know if you want to add anything.

Thanks, Linda. Caitlin, I'll start by saying this is our first collaboration with UCB, and it diversifies our revenue beyond just CIG in a meaningful way. On the strategic side, it's significant because as you mentioned, it opens up a new commercial channel for us beyond the home and that's into the infusion clinics. And we see there's a lot more opportunity there in the future beyond RYSTIGGO. As Linda mentioned, we do have off-label sales there today. We look forward to continuing to grow that now that we have the product on label and we could be promoting it. So I want to highlight UCB's reported just over 65% year-on-year growth in global RYSTIGGO sales. So we see this drug has a lot of momentum, and we're really looking forward to continue helping to bring value there. So acknowledging, we've had some really great success over the last few years here under Linda's leadership. The strategic priorities don't change. We have a proven strategy really built around 3 pillars: protecting and growing the Core Domestic business, expanding internationally and enabling more drugs to reach more patients. So I focus really on accelerating the execution against those pillars. I see it as we have a lot of runway in front of us and my job is to make sure we're running as fast and as efficiently as possible towards those opportunities.

[Operator Instructions] Our next question is from Joseph Downing with Piper Sandler.

Linda and Tom. First and foremost, Linda, I wanted to congratulate you on your retirement. It's been a pleasure working with you and wishing you all the best in the future. Yes, I just wanted to touch on the guidance range here. So it was pretty much in line with where we expected. Just looking at kind of the high end and low end, how you get to each. Curious if you can walk through that. I'm curious if on the low end is a scenario kind of where the new drug clearances and OUS prefill conversions slip into 2027 a little bit. And then the high end is more of you execute everything on schedule in '26. Just curious if you could walk through a little bit more detail there?

Great. Joe, thank you, and you and your Piper colleagues have been great, and congratulations to you on your recent promotion as well. So referring to the guidance range, I think you had it right. Prefills and the new drugs on label would be -- those are the things that vary. If we get prefill conversions faster, the markets get going faster. That's a great thing. And also new drugs, we get further traction or we get them on our label sooner, there's another big opportunity. The other third piece would be a little bit about the Middle East, which we've got a little bit of a factor in here and depending on the timing of that. And then finally, I would just say, oncology is something we do not have today, a big number in here at all, a very small number. So if we get a bigger head start on oncology or we're looking at new drugs now, I think that could be a meaningful area for us as well.

I appreciate that and for your comments. One more just on Japan. I know it's been kind of a deemphasized piece of the business with all the great stuff going on in some of the other U.S. markets, but just curious like where you're looking at that for 2026 guidance or expectations there just at a higher level. And is there a point there where the pharma-driven prefill opportunity kind of opens up and makes Japan kind of move back up the list? Yes. Just any color there would be helpful.

Yes, I'll start, and then turn it over to Adam. So Japan, we see, again, being 1 of the larger IG markets overall, we see that this could be $0.5 million to $1 million total opportunity. We know that today, that's very much a hospital, but moving to the home opportunity and lots of exciting stuff that I'm going to let Adam talk through.

Yes. Thanks, Linda. In Japan, I'll start with good news, right? So both pumps are approved. Consumables are approved as well. So we're pretty well positioned to continue to grow in that market. At the time we're seeing prefilled syringes there as being important, just as we kind of see in these other international markets. So as those prefills continue to grow, we expect that we're going to be growing with them. So it's a pretty exciting opportunity for us.

No further questions at this time. I would like to hand the floor back over to Linda Tharby for any closing remarks.

Right. Thank you, operator. I would just want to say thank you to all of you again. I have so appreciated all of your support your guidance, and most of all, your partnership in working with everyone on the call. Thank you all for taking some time with us this afternoon. Incredibly proud I want to say my last thanks to this entire KORU team, to my daughters who actually listened into an earnings call for a change. I told them there were some big news today. So I think they listened in. So thank you to my daughters. Thank you to our Board. Thank you to our investors I'm not gone yet. I am a big investor and will remain so and I look forward to working with all of you as this retirement goes on. But I'm here, as I said, to the end of June, looking forward to supporting Adam and the team and through the end of the year. Have a great rest of your day, and thank you so much.

This concludes today's conference. You may disconnect your lines at this time. Thank you again for your participation.