Good morning, ladies and gentlemen, and welcome to Veru Inc.'s investor conference call. [Operator Instructions] Please note, this event is being recorded. Statements made on this conference call that are not historical in nature are forward-looking statements. Such forward-looking statements reflect the company's current assessment of the risks and uncertainties related to our businesses. Our actual results and future developments could differ materially from the results and/or developments in such forward-looking statements. Factors that may cause actual results or developments to differ materially include such things as risks related to the company -- development of the company's product portfolio; risks related to the ability of the company to maintain sufficient financing on acceptable terms when needed to fund development and company operations; risks related to competition; government contracting risks; and other risks detailed in the company's press releases, shareholder communications and Securities and Exchange Commission filings. For additional information regarding such risks, the company urges you to review its 10-Q and 10-K SEC filings. I'd now like to turn the conference over to Dr. Mitchell Steiner, Veru Inc.'s CEO and President. Please go ahead.

Thank you, operator, and good morning. This is Dr. Mitchell Steiner, President and CEO of Veru Inc., and joining me today are Daniel Haines, CFO; and Kevin Gilbert, Senior Vice President, Corporate Development and Legal. I'm very proud of our team and our accomplishments to date as we transition to a biopharmaceutical company focusing on urology and oncology. Today, we will provide an update on the progress we're making with commercialization of our products and clinical development of our drug pipeline as well as provide financial highlights for the third fiscal quarter. You may have noticed from the operator's introduction the change in our corporate name to Veru Inc. This name change was just one of several proposals supported by stockholders at our recently completed special meetings -- meeting, and we thank the shareholders for their continued and significant support. We're no longer reliant on a single product, the FC2 Female Condom, and we're no longer reliant on a single market, the global public sector. We have our key team and organizational structure now in place. We now have a diversified revenue stream, with both FC2 via prescription in the U.S. and PREBOOST sales. We're advancing our deep pipeline of multiple 505(b)(2) and new drug products, including Tamsulosin DRS, Delayed Release Sachet, to which we should see additional revenue in the near term. For our results so far in 2017, the major highlights and milestones achieved are as follows. As of April, we now have the infrastructure in place and market access to make FC2 available by prescription in the United States since it's fully reimbursable by Medicaid and private insurers. By adding new national distribution contracts, FC2 is now available in 97% of the U.S. retail pharmacies. We have 12 salespeople marketing and selling in the U.S. We launched…

Thank you, Dr. Steiner. As Dr. Steiner indicated, we were encouraged to see the sales in the public sector recover slightly in fiscal Q3 to volumes closer to historical average, and we intend to aggressively compete for the coming substantial tenders in South Africa and Brazil. Speaking of Brazil, on our last call, we discussed our visit to Brazil on how positive we felt about the direction of the country. A week or so after that call, allegations of corruption against President Temer were announced, causing further uncertainty and possible delays in the payment schedule we have previously agreed to. As you might recall, Brazil owed a total of $13.1 million as of March 31, 2017. And through our distributor, we agreed to delay payment on $7.8 million of receivables in exchange for prompt payment on the remaining $5.3 million. As Dr. Steiner mentioned, we received several payments from Brazil this fiscal quarter, totaling $2.2 million, leaving an unpaid balance of $10.9 million as of June 30, 2017. In addition, we received another $2 million in the past couple of weeks. So although payments did not come as fast as we'd hoped, we only have the remaining $1.1 million to collect on near-term receivables as of today. Fortunately, the Brazilian Congress voted last week against prosecution of President Temer, not on the premise of his innocence but on the prospect of economic stability, which is certainly an encouraging sentiment and an indication of how Brazil is serious about putting its economic recovery ahead of politics. Speaking to our fiscal Q3 results. Unit sales totaled 8.5 million, which is 21% lower than the 10.7 million from Q3 2016. Net revenues for the quarter totaled $4.3 million, a decrease of 22% from the prior year quarter. Gross profit decreased 29% to $2.3…

Thanks, Dan. We continue to make substantial progress transforming The Female Health Company from a single global public healthcare product company into Veru Inc., a global biopharmaceutical company with a highly diversified drug product portfolio focusing on oncology and urology. It is the potential of our drug pipeline that should provide the most shareholder value. The 505(b)(2) pathway provides significant upside as it brings approved drugs with new indications or new formulations for the same indications to the market significantly and more rapidly, providing much shorter time to revenue. We've already advanced our current 505(b)(2) pharmaceutical products, notably Tamsulosin DRS, which has the potential to generate revenues in the near future. We believe this is an important step in delivering significant value to our stockholders. I am more excited than ever about our company's future, and I'm proud of our team for the great progress we have made to date. Finally, at the beginning of the call, I referenced our special meeting of stockholders with regard to the change of our corporate name from The Female Health Company to Veru Inc. All 5 of the proposals submitted to a vote at the special meeting exceeded their minimum required vote thresholds to be passed. We believe that these results better position the company for future growth and the potential creation of significant shareholder value. The increase in authorized shares provides financing flexibility regarding future opportunities, and the automatic conversion of the preferred shares simplifies our capital structure. The adoption of an equity incentive plan allows the company to retain, incentivize and attract a high-caliber team to deliver on the promise of the drug products in our pipeline while aligning our team's objectives with stockholder return. With that, I'll now open the call to questions. Operator?

[Operator Instructions] And the first question comes from Yi Chen with HC Wainwright.

The first question is, can you give us some additional color regarding the revenue recognized in this third quarter, besides the $2.2 million received from Brazil?

Revenue from did you say the prescription business?

Yes, if there's any.

Right. So the $2.2 million was cash received from Brazil. So that was -- that's considered our public sector. But I think Mitch can address questions on the prescription revenue.

I think he was asking in general to give color on other -- you want to know specific revenue streams?

I want to know what is inside the $4.3 million top line revenue in the third quarter.

The vast majority of it is global public sector revenue. The prescription revenue, which would be the incremental FC2 sales, is not material enough for us to talk about right now, and we intend to give a lot more detail on that on our next earnings call.

So the global sector -- the global public sector revenue in the third quarter, other than the $2.2 million received from Brazil is about $2.2 million or $2.3 million, right?

No. The revenue recorded in the period has no Brazil revenue in it. The $2.2 million we were discussing was aged receivables that were recognized as revenue years ago, in 2015 actually.

Okay. So the total global public sector revenue of FC2 in the third quarter is about $4.3 million, $4.2 million?

Correct, which exclude any revenue from Brazil.

Understand, understood. So is that -- is this the kind of level of global public sector you expect going forward? Or should we expect some fluctuations?

I think in the past, the company, you can -- we do a good job breaking out unit sales in the Q filing, which we should be making here in the next couple of days. But you can see the company has historically trended between probably 35 million up to 60 million units in the public sector. That's the historical averages. We had 2 down quarters. I would say this fiscal Q1 and fiscal Q2 were abnormally low. The total for this period of 8.5 million units approaches the historical averages, and we're hoping to see that trend continue upward and revisit those historical averages soon.

Right, let me also comment. It's a great question. But as I said in my comments that the future needs for the FC2 condom has also been clarified. So usually, what happens to these large customers is they publish or they announce the tender of how many units they're going to be looking for, for that period of time. And so last year was quiet. There was nothing. It was quiet. And so this year, we've already heard that Brazil, now that they're kind of getting through all of this craziness, is going to put in a whopping order of 50 million units. And in the past, I mean, that's probably one of the biggest annual orders that they planned to put in. And as you know, our company is the only one that has the capacity that can generate 100 -- can produce 100 million units a year. And so most -- the other competition globally are well below that. And so we think we're in good position, and our strategy is to get as much of that 50 million unit order. With that also said, South Africa also announced that they have a need for 120 million units over the next 3 years, so roughly 40 million units a year. So all of our emphasis in the public sector right now is to grab those 2 buckets, South Africa and Brazil, because -- again, let me just dream for a moment, if we're able to get all of the 40 million a year from South Africa and the 50 million in Brazil, we could have a 90-million-unit year next year. So again, I'm just dreaming. But it could be significantly close to that. So this market does fluctuate, and you have good years and you have bad years, and it looks like some of the strategies that we have employed globally and internally here in the U.S., aligning FC2 as a prescription business also means that we can sell less units into the U.S. and see the same kind of revenue we see outside the U.S. So it makes sense to do that. And again, diversifying our product portfolio so that as you look at our growth, you don't see the fluctuations from quarter-to-quarter, instead, you see growth. And in the background of that growth, we will always have the public sector that we're going to be aggressive about.

And could you provide some additional comments on what the prescription FC2 sales ramp up could look like going forward? And whether if -- if there's any change in the Affordable Care Act in the future, could that affect the prescription business in the U.S.?

Yes, so what we've spent since April -- and again, April is not that long ago -- is I gave you about 9 or 10 bullets of really major infrastructure changes that have to be put in place. And it took a lot of the team's effort. We have now a full complement of 12 sales people that are selling. We know it's promotionally sensitive because the numbers each week are looking better and better and growing as you would expect. But we're going to give ourselves 1 more quarter before we announce anything publicly in terms of number of prescription and sales. But as I mentioned in my comments, it's promotionally sensitive, and what that means is now that we're in 97% of the retail pharmacies and our national distributors also -- one of our national distributor is also a 3 PL, we can actually track it very carefully. And it clearly is related to the territories that are being serviced. With that said, one of our strategies is to go out there and get a co-promote or a marketing partner that has more sales people that we can "throw at it" because it's promotionally sensitive. And so I think you'll see that this strategy will play out very nicely. As it relates to ACA, the Affordable Care Act, just by way of history, prior to 2010, 28 of states, almost all of them are blue states, already had some sort of plan in place to cover female contraception; if not 100%, pretty darn close to 100%. And it was the idea of the blue states when they went from female contraception covered by blue states to female contraception covered by the nation, all 50 states, that's no surprise that they took that same model and applied it to…

Got it. Final question. Regarding Tamsulosin DRS, should we expect a data readout from the Stage 2 by the end of 2017?

Yes.

And regulatory submission in first half 2018?

Yes. Yes and a yes.

Ladies and gentlemen, this concludes our question-and-answer session. I would like to turn the conference back to Dr. Mitchell Steiner for any closing remarks.

Thank you, operator. I appreciate everybody joining us on today's call, and I look forward to updating everybody on our progress at our next investors call. Thank you very much for joining us.

Thank you. The digital replay of this conference will be available beginning approximately noon Eastern Time today, August 8, by dialing 1 (877) 344-7529 in the U.S. and 1 (412) 317-0088 internationally. You will be prompted to enter a replay access code, which will be 10110602. Please record your name and company when joining. The conference has now concluded. Thank you for attending today's discussion.