NRX Pharmaceuticals Inc Corporate and Strategic Update Conference Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Ed Woo - Ascendiant Capital Markets, LLC - Analyst : Yeah. Thank you for taking my questions, and congratulations.

Question: Ed Woo - Ascendiant Capital Markets, LLC - Analyst : My question is, how does this change your international strategy for NRX-101? Does it accelerate it in terms of being able to expand to markets outside the US?

Question: Ed Woo - Ascendiant Capital Markets, LLC - Analyst : Great. And then you mentioned about Asia. What about Europe opportunities?

Question: Ed Woo - Ascendiant Capital Markets, LLC - Analyst : That sounds great. In terms of -- have you thought about international markets? Are you planning on going to maybe Asia first or Europe first or both? Or is it still too early for you to think about that?

Question: Ed Woo - Ascendiant Capital Markets, LLC - Analyst : Great. Well, thank you for answering my questions, and again, good luck. Thank you.

Question: Charles Duncan - Cantor Fitzgerald, L.P. - Analyst : Hey, good morning, Stephen and Jonathan. Congratulations on this strategic collaboration, looks to be an interesting one, yeah. Stephen, I just had a couple of questions with regard to the terms of the transaction. I haven't had an opportunity to dive into these yet, but I'm wondering if you could provide us a little bit of color on really kind of the logic behind the value that was attributed. Could you give us a sense of if it was meant to really -- really meant to just cover past development milestones, or was there a consideration of, call it, the market potential of the drug? And was it a competitive process? Thanks.

Question: Charles Duncan - Cantor Fitzgerald, L.P. - Analyst : Okay, that's helpful. And then, of the $330 million in milestones, I'm sure you haven't disclosed it specifically, but could you give us a rough estimate of what percentage of those could be earned during development before commercial launch and what percent roughly post launch?

Question: Charles Duncan - Cantor Fitzgerald, L.P. - Analyst : Okay. And then with regard to the sales, thresholds are -- excuse me, are those achieved in an accrual basis, or is there a reset every year? Is that a total revenue per year?

Question: Charles Duncan - Cantor Fitzgerald, L.P. - Analyst : Okay, very good. Congratulations. It looks to be an interesting deal.

Question: Jason Kolbert - Dawson James Securities, Inc. - Analyst : Hi, thank you, my congratulations as well. I just want to zero in on a place where I think Charles was just going, which is, in terms of the value calculation that were used to create this deal, can you give us any insight into the math that was used that translated into these milestones? And can you talk a little bit about the royalties as well?

Question: Jason Kolbert - Dawson James Securities, Inc. - Analyst : In terms of the mathematics, what was the peak value that was used, and how did they discount it back to get to those milestones? I'm trying to get at the core of it.

Question: Jason Kolbert - Dawson James Securities, Inc. - Analyst : Can I ask this question then? How do you balance the opportunity in the US versus the opportunity -- and clearly, they have a big interest in Asia. And the reason why I asked the question is because there's a very different social paradigm around depression, suicide in Asia versus the US, so help me understand the thinking there. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JUNE 05, 2023 / 12:30PM, NRXP.OQ - NRX Pharmaceuticals Inc Corporate and Strategic Update Conference Call

Question: Jason Kolbert - Dawson James Securities, Inc. - Analyst : Okay, terrific. Thank you so much.

Question: Jason Kolbert - Dawson James Securities, Inc. - Analyst : Jonathan, just to add on to that, they have the first right of refusal on those additional indications. Is that correct?

Question: Jason Kolbert - Dawson James Securities, Inc. - Analyst : Got you. Okay. Thank you.

Question: Vernon Bernardino - H.C. Wainwright & Co., LLC - Analyst : Hi, Stephen and Jonathan. Thanks also for taking my question, and congratulations also from me on putting this deal together. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JUNE 05, 2023 / 12:30PM, NRXP.OQ - NRX Pharmaceuticals Inc Corporate and Strategic Update Conference Call I just wanted to ask about the total deal milestone terms that is the $330 million. Now it says milestone payments of increasing amounts up to $330 million. I assume that even though sales targets, perhaps are reached beyond initial targets, for example, that the total amount -- payments you would get is just $330 million, and any upside would be from royalty payments that you said would be 12% to 16%?

Question: Vernon Bernardino - H.C. Wainwright & Co., LLC - Analyst : And you would reach the 16% level when you reach the highest sales targets?

Question: Vernon Bernardino - H.C. Wainwright & Co., LLC - Analyst : Okay. And can you at least break down for us the reaching -- there is $330 million, which -- what milestone would actually get you to the last milestone payments in this deal structure?

Question: Vernon Bernardino - H.C. Wainwright & Co., LLC - Analyst : Okay. Okay, great. That's very helpful. I just wanted to drill down a little further as far as Charles and Jason's questions are concerned. I appreciate the further insight and congrats again. Looking forward to this drug getting developed quickly and into the hands of those who are --

Question: Matt Kaplan - Ladenburg Thalmann & Co. Inc. - Analyst : Yes, I'm on mute, sorry about that. Good morning, Steve.

Question: Matt Kaplan - Ladenburg Thalmann & Co. Inc. - Analyst : And congratulations on the deal. Great to hear your voice.

Question: Matt Kaplan - Ladenburg Thalmann & Co. Inc. - Analyst : You mentioned that the ongoing clinical development is going to be funded through your partner. Can you give us a little bit more detail in terms of what would define success in the ongoing Phase 2b/3 study to trigger the continuing payment or development by Lotus and Alvogen in the next Phase 3?

Question: Matt Kaplan - Ladenburg Thalmann & Co. Inc. - Analyst : All right. Thanks for the added detail, and congrats again. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JUNE 05, 2023 / 12:30PM, NRXP.OQ - NRX Pharmaceuticals Inc Corporate and Strategic Update Conference Call