ADMA BIOLOGICS, INC. Q4 2025 earnings call

Welcome, everyone. Thank you for joining us this afternoon to discuss ADMA Biologics' financial results for the fourth quarter and full year 2025 and recent corporate updates. I'm joined today by Adam Grossman, our President and Chief Executive Officer; Brad Tade, our retiring CFO and Treasurer; and Terry-Ann Kohler, our incoming CFO and Treasurer. During today's call, Adam will provide some introductory comments and provide an update on corporate progress. Brad will then provide an overview of the company's fourth quarter and full year 2025 financial results, and Terry will make some introductory comments. Finally, Adam will then provide some brief summary remarks before opening up the call for questions. Earlier today, we issued a press release detailing the full year 2025 financial results and summarized certain achievements and recent corporate updates. The release is available on our website at www.admabiologics.com.

Before we begin our formal comments, I'll remind you that we will be making forward-looking assertions during today's call that represent the company's intentions, expectations, or beliefs concerning future events, which constitute forward-looking statements for the purposes of the Safe Harbor provisions under the Private Securities Litigation Reform Act of 1995. All forward-looking statements are subject to factors, risks, and uncertainties, such as those detailed in today's press release announcing this call in our filings with the SEC, which may cause actual results to differ materially from the results expressed or implied by such statements. In addition, any forward-looking statements represent our views only as of the date of this call and should not be relied upon as representing our views as of any subsequent date. We specifically disclaim any obligations to update any such statements, except as required by the federal securities laws.

We refer you to the Disclosure Notice section in our earnings release we issued today and the Risk Factors section in our annual report on Form 10-K for the year ended December 31st, 2025, for a discussion of important factors that could cause actual results to differ materially from these forward-looking statements. Please note that the discussion on today's call includes certain non-GAAP financial measures, including adjusted EBITDA and adjusted net income. A reconciliation of these non-GAAP financial measures to the most directly comparable GAAP metric is available in our earnings release. With that, I would now like to turn the call over to Adam Grossman. Adam, go ahead.

Thank you. Good afternoon, everyone. ADMA delivered a strong finish to 2025, reflecting disciplined execution across our commercial, manufacturing, and financial platforms. For the full year, total revenue was $510 million, representing 20% year-over-year growth. Adjusted EBITDA was $231 million, increasing 40% year-over-year, and adjusted net income was $161 million, increasing 35% year-over-year. These results underscore the durability of our growth engine and the expanding operating leverage within our fully integrated U.S.-based business model. Importantly, 2025 was a defining year for ADMA. We expanded margins, improved our balance sheet, and executed several strategic initiatives that enhanced the long-term durability and earnings power of our company as we enter the next phase of growth. Asceniv continues to drive our growth.

For full year 2025, Asceniv achieved $363 million in net revenue, representing 51% year-over-year growth. Our differentiated, patent-protected specialty immune globulin exited the year at record utilization levels, driven by high demand and strong prescriber adoption. With Asceniv still forecasted to be early in its penetration curve within its total addressable market, driven by broad payer access and increasing confidence in long-term supply continuity, Asceniv is well positioned for sustained utilization growth throughout 2026 and beyond. Before turning to additional operating highlights, I want to briefly address working capital. We expect accounts receivable and day sales outstanding to improve over the course of 2026, trending toward and potentially improving beyond industry benchmarks over time.

The recent increase in working capital primarily reflects the growth in Asceniv and the acceleration in revenue growth we are guiding to as we continue to make meaningful inroads into Asceniv's still significantly under-penetrated addressable market. As demand builds and our McKesson distribution agreement ramps up, alongside further anticipated diversification of our distribution network, we expect improving working capital efficiency and cash conversion throughout 2026. We are also seeing continued validation of Asceniv's differentiation in real-world settings. Independent datasets generated during 2025 reinforce Asceniv's unique biologic profile. A peer-reviewed study by Tan et al., presented at the ACAAI 2025 conference and published in the Journal of Clinical Immunology, demonstrated statistically significant reductions in infections and hospitalizations among patients who failed prior IVIG therapy and transitioned to Asceniv. 71% of these patients showed clinical improvement.

These outcomes, along with additional publications expected throughout 2026, should further enhance physician confidence, support constructive payer engagement, and expand medical education and drive sustained utilization growth. From a manufacturing and supply perspective, 2025 marked a major inflection point as yield-enhanced production transitioned into routine commercial practice with continued FDA lot releases. This makes 2026 the first full year of yield-enhanced output, a structural improvement to our business model, supporting meaningful gross margin growth and increasing earnings power. In parallel, we strategically repositioned our plasma collection network to improve capital efficiency while securing our long-term high-titer plasma supply. In December, we entered into an agreement to monetize three plasma centers while retaining ownership of seven centers, and concurrently executed a long-term supply agreement that continues to diversify our high-titer plasma sourcing base.

With newly forged supply contracts with the purchaser of ADMA's three centers, in total, the company now has access to over 280 plasma collection centers. We have improved supply visibility through the late 2030s and beyond. This transaction remains on track to close this quarter. I want to thank the entire ADMA team for their exceptional execution and commitment throughout 2025. Their discipline and dedication continue to drive our performance and position us for sustained success. Before I turn the call over to Brad, I also want to share an important leadership update. After a successful tenure and meaningful contributions to ADMA's growth and financial transformation, including the successful onboarding of KPMG as the company's independent auditor, Brad has informed the company of his intention to retire as Chief Financial Officer and Treasurer.

We are grateful for Brad's contributions and partnership, and we are pleased that he will remain with ADMA in a consulting capacity through a structured transition period to ensure continuity of operations, which will extend through July of this year. Today, we are excited to announce the appointment of our incoming Chief Financial Officer and Treasurer, Terry Kohler. He brings extensive public company experience, deep expertise in working capital optimization and cash conversion, and a proven track record of disciplined capital allocation and financial execution. This leadership transition further solidifies our ability to scale efficiently, enhance financial flexibility, and maximize long-term stockholder value creation. Importantly, there have been no changes to our previously issued financial statements, no changes to our internal control conclusions, and our forward-looking guidance remains strong.

Our financial foundation remains robust, and our priorities are clear: Drive commercial execution, invest in our capital-efficient pipeline, and maintain balance sheet discipline. With that, I'll now turn the call over to Brad to review our fourth quarter and full-year financial results in greater detail.

Thank you, Adam. Our full year 2025 financial results demonstrate ADMA's consistent execution, expanding profitability and earnings power. Total revenue for the year was $510.2 million, representing 20% year-over-year growth. Gross margin expanded to 57.4%, compared to 51.5% in 2024, driven primarily by Asceniv's growing mix contribution and the successful transition of yield-enhanced production into routine commercial execution. Adjusted net income totaled $160.8 million, representing 35% growth, and adjusted EBITDA reached $231 million, increasing 40% year-over-year. These results reflect continued operating leverage, cost management, and the structural margin improvements anticipated by yield enhancement and embedded in our vertically integrated model. Fourth quarter, 2025, total revenue was $139.2 million, reflecting 18% year-over-year growth.

Importantly, we exited the fourth quarter of 2025 with corporate gross margins of 63.8%, representing approximately 10% year-over-year improvement. Fourth quarter, 2025, adjusted EBITDA grew by 52% to $73.6 million, and adjusted net income for the fourth quarter of 2025 grew by 57% to $52.6 million. Asceniv's continued growth through these broader market dynamics is a testament to the product's differentiation and relative insulation from standard IVIG market contours. ADMA ended 2025 with $88 million in cash, largely excluding proceeds from the previously announced plasma center divestiture, which remains on track to close in the first quarter of 2026. We maintain a healthy balance sheet and expect improved cash generation in 2026, driven by higher margins, improving working capital dynamics, and disciplined capital allocations.

Turning to our outlook, our 2026 and 2027 financial guidance forecasts continued Asceniv strength, favorable product mix shift, full-year yield enhanced production efficiencies, and sustained operating leverage. For 2026, total revenue is expected to exceed $635 million. Adjusted net income is expected to exceed $255 million, and adjusted EBITDA is expected to exceed $360 million. For 2027, total revenue is expected to exceed $775 million. Adjusted net income is expected to exceed $315 million, and adjusted EBITDA is expected to exceed $455 million. For 2029, total revenue is expected to exceed $1.1 billion, and adjusted EBITDA is expected to exceed $700 million.

These targets are driven by continued Asceniv penetration into its addressable patient market, full realization of yield enhancement efficiencies, continued mix improvement, and disciplined operational execution. Importantly, these projections exclude potential contributions from SG-001 and future capacity expansion, which represent meaningful potential long-term upside. We believe ADMA is entering 2026 from a position of strength, with strong demand in a growing U.S. IG market, higher margins, increasing cash generation, and a structurally improved earnings profile. As I've shared with our board and leadership team, it has been a privilege to serve as ADMA's Chief Financial Officer and Treasurer during a period of meaningful growth and financial transformation.

With record ascent of utilization, yield enhancement production now fully integrated into our commercial operations, and improving long-term plasma supply visibility, I believe ADMA is exceptionally well-positioned for sustained revenue growth, continued margin growth, and increasing cash generation in the years ahead. I am proud of what the team has accomplished, and I am exceedingly confident in the company's outlook. With that, prior to turning the call back to Adam, I'd like to introduce Terry to say a few words. Terry?

Thanks, Brad. I'm excited to join ADMA's management team at a time of significant momentum and forward-looking opportunities. The company has built a differentiated platform with high demand, increasing margins, and a clear path to increasing cash generation. My focus will be on supporting disciplined execution, strengthening working capital performance and cash conversion, and enhancing financial strategy as we scale. I look forward to partnering with Adam, Caitlin, our COO, and the entire ADMA team to continue to drive growth, profitability, and long-term shareholder value.

Thanks, Terry. Adam, I'll pass it back to you.

Thank you, Brad and Terry. Stepping back, ADMA is entering 2026 with strong momentum and increasing financial strengths. We are scaling a differentiated growth platform with the highest margins in the plasma-derived therapeutics complex. The company is committed to improving its capital efficiency while forging ahead with our focus on generating increasing cash flow, which we believe will unlock meaningful stockholder value. Asceniv remains the core of our growth strategy. In 2026, we expect continued demand and market penetration, expanding prescriber adoption, durable and now expanded payer access, and growing market confidence in our IG supply continuity. With Asceniv still forecast to be early in its penetration curve, we believe the runway for sustained utilization and growth remains significant. Yield-enhanced production is now fully integrated into commercial operations, making 2026 our first full year of structurally higher margin IG output.

Combined with continued mix shift towards Asceniv, we are well positioned for outside gross margin growth, increasing operating leverage, and continued earnings power. The strategic repositioning of our plasma collection network enhances capital efficiency and secures diversified long-term supply visibility through the late 2030s. These actions are expected to generate accretive cost savings beginning in 2026 and further improve the durability of our platform. Beyond our commercial business, our lead pipeline asset, SG-001, represents meaningful long-term optionality. We anticipate submitting a pre-IND package in 2026, potentially enabling direct progression into a cost-efficient registrational trial. We continue to view SG-001 as a potential $300 million-$500 million peak annual revenue opportunity. In closing, ADMA has never been better positioned. We are forecasting substantial revenue growth, continued margin growth, and increasing cash generation, driven by disciplined execution across the organization.

Thank you for your time today. We appreciate your continued interest and support. With that, operator, let's open up the call for questions.