Talphera, Inc. Common Stock 2026 Q2 Earnings Call

Thank you for joining us on the call today. Today, we announced our second quarter 2026 financial results and associated business updates in a press release. With me today are Vince Angotti, our Chief Executive Officer, and Dr. Shakil Aslam, Talphera's Chief Medical Officer. Before we begin, I want to remind listeners that during this call, we will likely make forward-looking statements within the meaning of the federal securities laws. These forward-looking statements involve risks and uncertainties regarding the operations and future results of Talphera. Please refer to our press release in addition to the company's periodic, current, and annual reports filed with the SEC for a discussion of the risks associated with such forward-looking statements. These documents can also be found on our website within the Investors section. I'll now hand the call over to Vince.

Thanks, Rafi. Good afternoon, and thank you to everyone joining our call today. We remain on track to complete enrollment in the NEPHRO-CRRT study later this year. This registrational trial is designed to evaluate whether nafamostat is a safe and effective anticoagulant for use during continuous renal replacement therapy, or CRRT. The study is being conducted in hospital ICUs with nephrologists leading as principal investigators. With all of our final clinical sites now activated, we have reached 75% enrollment in the NEPHRO-CRRT study. This progress allows us to increasingly turn our attention to the commercial aspects of nafamostat. We remain especially pleased with the high level of engagement from our principal investigators and study site personnel. Today, we'll share some details on these areas, along with some initial insights from our updated market research on nafamostat and the CRRT space.

On the commercial front, clinical guidelines are an important part of the treatment landscape and we're encouraged by recent developments. Specifically, the KDIGO 2026 clinical practice guideline for acute kidney injury and acute kidney disease is currently pending final publication following the close of its public comment period in May. KDIGO, which stands for Kidney Disease: Improving Global Outcomes, is the global nonprofit organization that develops and implements evidence-based clinical practice guidelines in kidney disease. Of note, the guideline now references nafamostat as an acceptable regional anticoagulant. The only available regional anticoagulant being used in the U.S. today is citrate. Yet regional citrate's not FDA approved for CRRT, and it's also complex to use and has other limitations. As a result, most U.S. sites simply don't incorporate it into their CRRT protocols.

This is the first time nafamostat has been recommended in the KDIGO guidelines, supported by historical studies and publications, a positive change from prior published recommendations. KDIGO guidelines are widely referenced by healthcare providers internationally. We believe this guideline will provide momentum for the commercialization of nafamostat, if approved. This new guidance should further highlight to healthcare professionals that nafamostat is already standard medical practice in Japan and South Korea, where it is the most widely used method of anticoagulation during CRRT. A 2018 national survey in Japan found that nafamostat was used in about 80% of cases, making it the most common method of circuit anticoagulation. In South Korea, nafamostat was approved for this use in 2005 and remains one of the most widely used anticoagulation methods today. In addition, our updated market research on the CRRT space points to a larger market opportunity for nafamostat than initially estimated.

This research puts the estimated annual CRRT procedures in 2027, the projected timing of a nafamostat launch, at approximately 200,000 in the U.S. That's a 21% increase from our prior estimate of 165,000, driven by new data from this research. We also expect the number of CRRT procedures to continue growing annually. We believe nafamostat, if approved, can address an unmet need in the market given the disadvantages of systemic heparin and regional citrate. Addressing that unmet need provides nafamostat with an opportunity to gain a meaningful share of the CRRT anticoagulant market. These market insights are consistent with what we're hearing directly from principal investigators and other physicians about the currently available CRRT anticoagulants. We'll share the complete findings later this year at another investor and analyst event as we get closer to completing enrollment.

Now I'll turn the call over to Dr. Aslam, our Chief Medical Officer, for some comments on the study.

Shakeel? Yes. Thanks, Vince, and good afternoon, everyone.

I am very pleased with the progress we are seeing in the NEPHRO-CRRT study as we move toward completing enrollment later this year. We have completed the realignment of sites to match our target profile. Now all sites have nephrologists as the principal investigators and are recruiting patients primarily from the medical ICUs. Finalizing our study sites, coupled with protocol modifications granted by the FDA, has us on track to complete enrollment later this year. As a reminder, NEPHRO-CRRT is a placebo-controlled study in which administration, titration, and monitoring of anticoagulation are identical in both treatment arms. With 75% of patients enrolled, our investigators have consistently reported that these procedures are straightforward to perform.

The investigators continue to express their excitement over having nafamostat available for their use, if approved, and its inclusion in the public review draft of 2026 KDIGO guideline as a regional anticoagulant alternative to citrate. The international expert panel's inclusion of nafamostat reflects decades of clinical experience and accumulated published evidence on the safety and efficacy of nafamostat as a regional anticoagulant during CRRT, and we look forward to sharing the study results with you. With that, I'll hand the call over to Rafi to update you on the financial results for the second quarter.

Rafi? Thanks, Shakeel. Our cash balance at June 30, 2026, was $17.1 million.

We believe this cash, combined with future conditional financing tranches, will provide us sufficient capital through at least a potential Niyad PMA approval expected in 2027. Two conditional financing tranches remain, totaling approximately $16 million of additional capital. If the conditions are met, we expect these to close around the time we release our top-line data and announce the completion of the study. Our cash operating expenses, or combined R&D and SG&A expenses for the second quarter of 2026 totaled $3.9 million, compared to $3.7 million for the second quarter of 2025. Excluding non-cash stock-based compensation expense, these amounts were $3.7 million for the second quarter of 2026 compared to $3.5 million for the second quarter of 2025.

The $0.2 million increase in cash operating expenses in the second quarter of 2026 was primarily due to higher Niyad development expenses reflecting increased enrollment and certain SG&A expenses relating to initial market research activities. I'll now hand the call over to Vince.

Thank you, Rafi. Thank you for joining our second quarter earnings call. With enrollment progressing well, we remain on track to complete enrollment in the NEPHRO-CRRT registrational study later this year and to report top-line data soon thereafter. Our focus remains on bringing nafamostat to the market as a new regional anticoagulant for CRRT, if approved. I'd now like to open the line up for any questions you might have.