Thank you, Abby. It's my pleasure to welcome everyone to Liquidia's third quarter 2022 financial results and corporate update conference call.

Joining the call today are Chief Executive Officer, Roger Jeffs; Chief Financial Officer, Mike Kaseta; General Counsel, Rusty Schundler; and other members of the Liquidia management team. Before we begin, please note that today's conference call will contain forward-looking statements, including those statements regarding future results, unaudited and forward-looking financial information, as well as the company's future performance and/or achievements.

These statements are subject to known and unknown risks and uncertainties, which may cause actual results or performance to be materially different from any future results or performance expressed or implied on the call. For additional information, including a detailed discussion of our risk factors, please refer to the company's documents filed with the Securities and Exchange Commission, which can be accessed on our website.

I'd now like to turn the call over to Roger for our prepared remarks, after which we will open the call up for your questions. Roger?

Thank you, Jason. Good morning, everyone, and thank you for joining us.

I firmly believe we will look back at the third quarter as a seminal point in our mission to bring YUTREPIA to patients. Notably, and as Rusty will expand upon shortly, we achieved outcomes in our legal proceedings that have simply affirmed on appeal will allow us to launch YUTREPIA as all of the asserted patent claims have been found in at least one proceeding to be invalid or not infringed.

Our primary goal is to obtain the affirmations of these favorable decisions as quickly as possible so that YUTREPIA can become an important treatment choice for patients, physicians and payers. Our drive to get to the market is greatly strengthened by robust patient and physician feedback even after the launch of TYVASO DPI.

The two primary unique product pillars that resonate firmly with patients and physicians are, one, the high degree of tolerability and associated dose flexibility enabled by our PRINT formulation; and two, the ease of use of the low-resistance device. Firstly, with regard to the high degree of tolerability and dose flexibility.

We have observed in our open-label extension exposures – sorry, we have observed in our open-label extension study exposures up to 238.5 micrograms of YUTREPIA, which equates to greater than or equal to 27 breaths of TYVASO, which, as you may know, has a label therapeutic target of only 9 to 12 breaths per session due to tolerability limitations. YUTREPIA's radically different dose profile significantly transforms the therapeutic utility of inhaled treprostinil delivery.

Specifically, the ability to modulate YUTREPIA dose over a wide range makes it customizable for a broader spectrum of PAH patients from patients naive to therapy, in place of oral prostacyclin therapy or for patients intolerant to oral prostacyclin therapies, from transitions from other less flexible inhaled therapies and even patients improved from parenteral therapies, given patients will now be able to achieve parenteral-like dose exposures. With this broad and customizable dose profile, it is easy to envision that YUTREPIA can quickly assert itself as the highest utility treprostinil, obviating the need to endure the rough specific side effects of oral and parenteral therapy.

These dosing benefits are further augmented by the second product pillar of YUTREPIA: the ease of use of the low-resistance dry powder inhaler, a device that is robust to patient misuse scenarios and without specific orientation requirements, either of which could result in poor drug delivery or even spillage from the competitor's high-resistance device. YUTREPIA's device-specific advantages will further strengthen the position of YUTREPIA as the dominant choice.

It is important to note that the benefit of a low-resistant device to deliver YUTREPIA also means that the therapy is highly agnostic to the presence of comorbid lung dysfunction. This advantage will be especially relevant in PH-ILD patients who may not have the inspiratory capacity to use a high-resistance device and should further enhance patient uptake of YUTREPIA as a preferred choice in this rapidly expanding market opportunity.

With these product attributes and benefits, it is easy to envision that YUTREPIA can quickly become the best-in-class and first-in-choice prostacyclin, both in PAH and PH-ILD populations. I would now like to turn the call over to Rusty for an update on the legal proceedings.

Rusty?

Thanks, Roger. As Roger mentioned, the path to resolution of the litigation is now clear.

The company has now demonstrated through proceedings in the court and the parallel inter partes review proceedings before the Patent Trial and Appeal Board that each of the claims asserted by United Therapeutics against the company are invalid or not infringed. Although, the District Court ruled against Liquidia on the '793 patent, that ruling will be overridden by the PTAB decision on the '793 patent if it is affirmed on appeal.

Thus, if the decisions we have received from the District Court and the PTAB are all affirmed on appeal, Liquidia will be able to see final approval of YUTREPIA. We do not need to have any of the decisions overturned.

With these decisions in hand, our focus is now on timing. Appeal of the District Court decision on the '901 IPR decision are already underway.

United Therapeutics filed a request for a rehearing and a request for Precedential Opinion Panel review of the PTAB’s decision regarding the ‘793 patent. The Precedential Opinion Panel request has already been denied.

If the rehearing request is similarly denied, we would anticipate that the appeal of the PTAB’s decision on the ‘793 patent will likely take approximately 12 to 14 months from the date of the denial. We also note that there are opportunities for this time line to be accelerated.

For instance, it is not uncommon for the Federal Circuit to issue summary of formats of the underlying PTAB decision within days of the oral argument. If this was to occur, that could accelerate our projected time line of the appeal by several months.

In summary, we remain confident that the conclusion – at the conclusion of the appeals process we will be found not to have infringed any valid patent claims, allowing us to seek final approval of YUTREPIA from the FDA. And we will do everything we can to proceed through the appeals process as quickly as possible.

I’ll now pass the call on to Mike for an overview of our financial report. Mike?

Thank you, Rusty, and good morning, everyone. Our third quarter 2022 financial results can be found in the press release issued earlier today and our Form 10-Q to be filed with the SEC after market closes today.

In those documents, you will see that revenue was $3.2 million for the three months ended June 30, 2022, compared to $3.2 million for the same quarter in 2021. Revenue related primarily to the sale of Treprostinil Injection under the profit split agreement with Sandoz.

Unit volume was strong and has increased each quarter since the last of subcu in second quarter 2021. However, due to a negative adjustment in the gross to net reserves, net revenue decreased slightly compared to last quarter.

Cost of revenue was $0.7 million for the quarter, which was the same compared to the third quarter of 2021. Research and development expenses were $4.5 million for the quarter, which was the same compared to the third quarter of 2021.

We incurred $1.5 million related to YUTREPIA compared to $1.4 million during the same quarter the prior year. General and administrative expenses were $6.7 million compared with $4.9 million.

The increase of $1.8 million was primarily due to a $2.2 million increase in commercial, marketing and personnel expenses in preparation for the potential commercialization of YUTREPIA offset by a $0.9 million decrease in legal fees related to our ongoing YUTREPIA-related litigation. Other expenses in the quarter totaled $0.3 million, an increase of $0.1 million over the same quarter last year related to interest expense due to a higher debt balance and interest rate on our debt with Silicon Valley Bank.

All totaled, we incurred a net loss in the third quarter of 2022 of $9.1 million or $0.14 per basic and diluted share compared to a net loss of $7.3 million or $0.14 per basic and diluted share for the third quarter 2021. Turning to our balance sheet.

We ended the third quarter with cash and cash equivalents totaling $98.3 million as compared to $57.5 million as of December 31, 2021. We believe that the cash on hand, combined with revenue from Treprostinil Injection will support operations into 2024.

I would now like to turn the call back over to Roger.

Thank you, Mike, and thank you, Rusty. At this time, I would now like to open the call for questions.

Operator, first question, please.

Good morning. Thanks for taking our question.

Wondering what is the path to get in PH-ILD on the label? I know you said that no additional studies are required, but just wanted to see what are the logistical steps necessary and the timing that could be expected there?

Greg, thank you for the question. So as you know, the market exclusivity for Tyvaso PH-ILD expires at the – in March of 2024 and we’ve confirmed with the FDA that no additional studies are required for the expansion of our label to include PH-ILD indication.

So for us, what we need to do is submit a request for that approval at an appropriate time in advance of the March 2024 deadline. We may also then have to give a safety update that’s sort of real time from our ongoing open-label extension study.

But absent that, there’s nothing else to do. So no further studies required.

It’s absolutely an open market for us at the end of the March period if we are granted approval.

Great. Thanks for taking the question.

Great. Thank you so much for taking the questions.

I guess, first, I was curious if we could get any visibility on the generic Remodulin business for next year, just if there would be any growth expected or if we should again just kind of expect a flat kind of business there. The second question I had was maybe just kind of a clarification.

I’m sorry, it took me a minute to dial into the call, but with respect to United Therapeutics request for a hearing and if that is, in fact, denied, could you help us understand what the time line might be for an appeal process for them, I think, on the ‘793 patent. And then if you’ll entertain a third question, just curious how you guys are thinking about financing right now going through next year and getting through 2024 and beyond.

Thanks so much.

Great. Good morning, Chris and thanks for the question.

What I’ll do is I’ll group these in for Mike and Rusty to answer. So Mike, if you could answer the question about generic Remodulin trajectory and then also how we’re looking at financing and then pass it to Rusty to talk about the request for hearing time line.

Yes, absolutely, Roger. Good morning, Chris.

Good to talk to you. So as it relates to generic Remodulin, as we said earlier today, we’ve seen unit increase on a quarterly basis each quarter since the launch of subcu in Q2 of 2021.

We’ve seen – we’re very happy with the growth in the product, as we said. And as we said previously, we really look at generic Remodulin as more of an annuity.

So although we’re continuing to see that growth, we would not see – we would not expect to see a significant increase in revenue as we get into 2023 and 2024, although it remains a very important strategic product for us as we prepare to launch for YUTREPIA. But overall, we do look at it as more of an annuity and maybe a flat to modest increase as we look into 2023.

Looking at financing, as we said, we ended the quarter with about $98 million in cash. We feel that that runway gives us significant – sufficient capital to get us into 2024.

As we’ve done over the last couple of years, and we will continue to do, is we’re going to be opportunistic. We’re going to look at any opportunities to bring in both dilutive and non-dilutive financing.

Given where we are right now, we are very confident with our cash position to be able to execute on our objectives for 2023. But at the same time, we will leave no stone unturned in evaluating opportunities.

And if we feel there is an opportunity to bring additional capital in that’s in the best interest of our shareholders, we will absolutely consider that. So with that, let me turn it over to Rusty on the rehearing request question.

Thanks, Mike, and thanks, Chris, for the question. So as I noted earlier, United Therapeutics requested two things in response to the PTAB decision.

They asked for a rehearing and they asked for a Precedential Opinion Panel review. The Precedential Opinion Panel review has been denied, which clears the way for the original PTAB panel to now make a ruling on the rehearing request.

I think your question primarily relates to the end of the time line after – if rehearing request is denied, what does the time line look like after that. We anticipate that the appeals time line will take approximately 12 to 14 months following the denial of the rehearing request.

However, that 12 to 14-month period can be accelerated. So as I mentioned earlier, sometimes the Federal Circuit will do something called the summary affirmance where within days after the oral argument they’ll issue their decisions rather than taking months to write opinion.

So again, that 12 to 14-month time period there are opportunities for fairly significant number of months to be taken off that time line. It’s something like summary affirmance is supposed to happen.

Thanks.

Yes. Okay.

Got it. And maybe just a slight clarification there, too, is with respect to the POP process, I think you had mentioned to me previously, Rusty, that, that, in fact, could offer some of those synergies.

Is that fair? And if true, what would those be in the process?

Thank you.

Sorry, can you repeat the question?

I’m so sorry, I was trying to cough. The – I guess my question is the POP denial that we just went through, I think you previously had told me that provides synergies in the process and time efficiencies.

Is that kind of what you’re talking about here?

No, that’s – it’s really a separate process. So I think our view of the Precedential Opinion Panel requests, as we had indicated in our press release several weeks ago, we think that they have directed the original panel to clarify their opinion.

We do think that will be helpful in the appeals process that we think a clearer decision from the PTAB will make the appeals process easier because the appeals court will have a clearer decision that they’re dealing with. I don’t know that it would necessarily impact the time line.

But I think it should make for a better appeals process because, again, the issues will just be much clearer before the appeals court as to what the record of the PTAB was.

Okay. That’s great.

Thank you so much.

Great. Thank you, Rusty.

Operator, next question please.

Hi. Good morning.

Thank you for taking my questions. Sorry if I missed it just now, but wondering if you have a good sense for the time line for Hatch-Waxman appeals in the event that PTAB appeal is denied in your favor with Hatch-Waxman appeal still pending, could you be in a position to launch YUTREPIA at risk?

Thanks.

Yes. Rusty, if you would, please?

Sure. So we do not need the Hatch-Waxman appeal to be resolved before we would be able to launch.

So if, for instance, the ‘793 appeal was resolved first and it was affirmed, that’s all we would need to then seek final approval from the FDA. Now obviously, the outcome of the appeal of the Hatch-Waxman would still be relevant.

But from a time line perspective, getting to an appeal decision in the Hatch-Waxman is not a part of the time line.

Okay. Great.

Thanks.

Thank you, Julian. Operator, next question please.

Hi. Good morning.

Can you give us some sense of the feedback you’ve been getting and response from doctors, I guess, to the data that you’ve presented, I guess, most recently at the CHEST meeting and how that plays into your plans to your commercialization preparation plans from here to approval.

Yes, happy to do that. So I’ll maybe start with the answer, and then I’ll ask our CMO, Dr.

Rajeev Saggar to also opine. So we presented two abstracts at CHEST.

One was on the robustness of our device, particularly the patient misuse scenarios, for example, patients dropping the device advertently. And we showed that it was highly robust and didn’t result in any product spillage.

And we also presented longer-term extension data for patients who had gone out to two years. And the importance of that data, in essence, was that we’re showing higher dose exposures as we said in the opening up to 238.5 micrograms, which would be 27 breath equivalents per session of Tyvaso.

So sort of a completely new modality of treatment with YUTREPIA versus Tyvaso, in particular, the nebulized formulations. And the advantage of that is that there’s great acknowledgment that dose is important.

And I think the other thing it does, which we tried to talk to in the opening, is that it’s going to avail itself to a broader reach of patients across a greater continuum and we think can help displace oral therapy. So as an example, I think just last week, United Therapeutics' press release, what they called the EXPEDITE study, and that study used parenteral induction to get patients to clinically impactful oral doses.

So to me, what that study acknowledged was that dose is important because what they were trying to do is drive dose for oral by using a three to eight-week induction period, both in the hospital and out of hospital. So a rigorous induction.

It also is an admission that titration to an efficacious dose on oral is problematic. So I think dose is important in that study because the need to do a parenteral induction speaks to the fact that getting to an efficacious dose on oral is problematic.

The fact that it took eight weeks to ramp and was done, as I said, sometimes as an in-patient shows you how sort of cumbersome just doing that would be. And then the transition from that induction on parenteral back to oral, again, took one to three weeks, again, including in-patient studies so – in-patient transition.

And then interestingly, during the induction, which was supposed to solve to get patients to dose, patients experienced headache, nausea and vomiting. So GI distress, which is – which they were greatly trying to obviate through induction.

So to me, that is a perfect example and a relevant publication to show the value of YUTREPIA and how it can be used both early in the treatment course as the first choice and best choice prostacyclin. And Rajeev, maybe I could pass it over to you for some of your comments on the clinical presentation at the conference.

Yes. Thanks, Roger.

Thanks, Matt, for the question. I think you explained the two clinical abstracts that we had presented.

But I think I'll take this time to maybe talk about a little bit how we can springboard off these exciting learnings from not only our published INSPIRE data, but also our ongoing INSPIRE open-label extension study in addition to the device robustness that Roger just talked about. And really understand that over the next year and prior to launch, we'll be definitely moving forward with several sort of Phase 4-esque like clinical studies, really focusing our positioning YUTREPIA as the highest utility and best-in-class and first-of-choice prostacyclin therapy across PAH that will maximize our experience for this launch.

And in particular, we would like to focus on studies utilizing concepts from these learnings, including sort of rapid and high dose titration strategies to improve clinical risk profiles, improve exercise capacity that is customizable to treat various severities as well as low, as well as intermediate and high risk strata inclusive of incident and prevalent patients with pulmonary hypertension. And finally, we'll also focus on gaining real-world experience using YUTREPIA on patients with pulmonary hypertension associated with interstitial lung disease, all to prepare us for our pending launch.

Back to you, Roger.

Thank you, Rajeev. I think what you're saying, and we appreciate the question, Matt, is the importance of dose and the flexibility that YUTREPIA ports to all different kinds of patients we think really will establish it again as the best choice and the first choice.

And thank you for the question, Matt. Operator, next question, please.

Hi, good morning. Thanks for taking my questions.

A few, mostly on the ongoing legal processes, I guess for Rusty, when do you expect to hear a decision from PTAB on the rehearing request? And you talked about a potential 12 to 14-month process for the appeals.

Just curious, when would you expect some visibility on whether that 12 to 14-month time line could be reduced? And then lastly, on the appeals for the District Court ruling, just give us some time lines on that.

Thank you.

Thanks, Serge. So to go through the three questions in order.

So as to when we expect the rehearing request decision, as I think we may have said on prior calls, the PTAB's internal goal for processing rehearing requests is one month from the date the rehearing request was submitted. Obviously, at this point, we're 2.5 months, almost three months from the date of the submission.

With the Precedential Opinion Panel decision having now come down, the path is cleared for the PTAB – the original PTAB panel to make a final decision on the rehearing request. So our hope is it's within the next few weeks, but we don't have visibility as to that process.

And as evidenced by our experience with the '901 patent, in that instance, it took the PTAB panel seven months before they issued a rehearing decision. So again, our hope is it's weeks, but we don't have visibility as to that process.

Second, as far as the – when we would know whether the 12 to 14-month time period I described could be shortened, that is unclear. So for instance, if it's a summary affirmance, if that's one of the things that would shorten time periods, we won't know that until the decision is made.

There's no – you don't get any sort of indication in advance that you're going to get a summary affirmance. So we would go into the oral argument and then three days later, an opinion would come down, and that's when we would know.

So it would be at the very end of the time period. Suddenly it would just be over instead of waiting a few months for an opinion.

So again, we won't know necessarily in advance when that – when and if that time period will be shortened. Finally, on the appeals from the District Court, there as well we think it's a 12 to 14-month process from the date the notice of appeal is filed.

Our initial notice of appeal was filed in early to mid-September. So again, we think 12 to 14 months is a reasonable time period from then.

So that would put it some time to third to fourth quarter next year. The one thing I'd note is in the Hatch-Waxman context, summary affirmance is far less likely.

And in fact, because there we'd be hoping to overturn a decision, you can't get a summary affirmance if something is to be overturned. So there wouldn't necessarily be the same opportunities for that time line to be shortened as there are for the PTAB appeal.

Thanks.

Great, thanks Rusty.

Thank you. Operator?

Great. Thank you, Abby.

So with no further questions, again, we thank you for joining us today and look forward to reporting our continued progress in the coming quarters.