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Operator
Good morning, ladies and gentlemen. Thank you for standing by. Welcome to VolitionRx Limited's first quarter 2021 earnings conference call. During today's presentation, all parties will be in a listen-only mode. Following the presentation, the conference call will be open for questions. If you have a question, please press star key followed by the number one on your touchtone phone. If you would like to withdraw your question, please press star key followed by the number two. If you're using speaker equipment, please lift the handset before making your selections. This conference call is being recorded today, May 12th, 2021. I'd now like to turn the conference call over to Scott Powell, Executive Vice President of Investor Relations. Please go ahead.
Scott Powell
Thank you and welcome everyone to today's earnings conference call. for VolitionRx Limited. This call will cover Volition's financial and operating results for the first quarter of 2021, along with a discussion of our recent activities and key upcoming milestones. Following our prepared remarks, we will open the conference call to a question and answer session. On our call today is Mr. Cameron Reynolds, President and Chief Executive Officer, and Mr. Terry Cuse, our Chief Financial Officer. Before we begin, I'd like to remind everyone that some of the information discussed on this conference call will include forward-looking statements covered under the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements are based on our beliefs as well as assumptions we have used based upon information currently available to us. Because these statements reflect our current views concerning future events, these statements involve risks, uncertainties, and assumptions. Actual future results may vary significantly based on a number of factors that may cause the actual results or events to be materially different from future results, performance, or achievements expressed or implied by these statements. We have identified various risk factors associated with our operations in our most recent annual report on Form 10-K, quarterly reports on Form 10-Q, and other filings with the Securities and Exchange Commission. We do not undertake an obligation to update any forward-looking statements made during the course of this call. I would now like to turn the call over to our President and Chief Executive Officer, Mr. Cameron Reynolds. Cameron?
Cameron Reynolds
Thank you, everyone, for joining Volition's conference call today. I especially appreciate it given the busy earnings call season. And speaking of busy, wow, we have had quite a start to the year and have made excellent progress in developing a range of products based on our proprietary NUQ platform. I expect that we will have a lot of news throughout the remainder of this year on additional product developments worldwide. I will be updating you today on our products, people, patents, publications, and most importantly, progress within all four key pillars, NUQ Cancer, NUQ Vet, NUQ Nets, and NUQ Capture. But to start off, I'll quickly hand over to Tereg for the financial report.
spk01
Thanks very much, Cameron, and thank you everyone for joining our call today. I'll now provide a summary of the key financial results for the quarter ended March 31, 2021, During the 2021 quarter, we reported a net loss of $6.1 million as compared to a net loss of $5.9 million in the same period last year. This result reflected research and development expenditure of $3.9 million, which was in line with last year, general and administrative expenses of $1.8 million, approximately $100,000 higher than last year, and sales and marketing expenditures of $0.4 million, approximately $150,000 higher than last year. The slight increase in operating expenses during the first quarter of 2021 was primarily driven by our ongoing transition to a commercial organization. During the first quarter of 2021, we significantly strengthened our balance sheet by adding aggregate net proceeds of approximately $20.3 million in cash through an underwritten public offering of our common stock in February, as well as through our at-the-market or ATM equity distribution program, with the last sale during the quarter under the ATM occurring on February 10th. We were also delighted to announce in January the award of approximately $4 million in non-diluted funding from the Walloon region and the Moore Invest. We have a long history of support from agencies of the Walloon region, who to date have awarded Volition approximately $13 million in non-diluted funding, including this most recent award. This additional funding consisted of a cash grant of $1.3 million and $2.7 million in loans. And so, we closed out the first quarter of 2021 with cash and cash equivalents of approximately $33.1 million, compared with approximately $19.4 million at the end of 2020. With continued work on commercialization and the expected national rollout of new cuvette in the United States, soon to be underway, we expect the cash burn rate going forward to average around $2 million per month. The company is in its strongest ever cash position, and this provides us both a great runway to achieve our many milestones and continuing flexibility to weather the ongoing pandemic. From a revenue perspective, we recorded $25,000 in the first quarter of 2021, mainly from the beta launch of NewQ VET, which Cameron will discuss in greater detail later. Given we are seeing a lot of interest in the VET product on the licensing side, and as we anticipate the national launch in the U.S. in the next few months, we would expect to see this revenue grow strongly through the year from the modest base set during the beta launch. Last but not least, our new commercial team is building a solid pipeline of sales opportunities as we're also seeing a lot of interest from NUQ Discover, our sample processing service for external parties such as pharmaceutical companies, biotech companies, and academic researchers in Europe. We believe that this opportunity should also translate into solid revenue this year. And with that, I'll pass back to Cameron for further operational and product updates. Thanks, Tarek.
Cameron Reynolds
I'm delighted to have the strongest balance sheet we have ever had, combined with the expectation of significant revenue growth throughout 2021. It is great to have you on board. In fact, while we're talking about new team members, I'll kick off with a people update, which as of late has mainly been focused on broadening the team with top talent to assist with commercialization of our new Q platform. To be clear, we also remain committed to and aim to keep our exceptional R&D team in place to continue to drive world-class innovation. In the first quarter of 2021, alongside Tereg joining us as our new Chief Financial Officer, we also welcome Gail Fortere, our Chief Commercial Officer, to our Executive Management Team to help manage the broadening range of products, including potential products. In addition to the promotion of Gitan Michel to the role of Chief Operating Officer, and Dr. Mark Eccleston, one of our founding scientists, to the newly created role of Chief Technology Officer. We also announced the appointment of two independent directors to our main board, Kim Nguyen, an HR executive with global expertise at Google, and Richard Brudnick, a pharmaceutical business executive with extensive commercialization know-how. And more recently, as of May 1st, Dr. Tom Butera has joined the team as chief executive officer of our veterinary subsidiary. Given our belief that NucuVet has enormous potential, we felt we needed a world-class leader for our veterinary products launches. Tom, a seasoned veterinary executive with a fantastic track record, joined us directly from the Veterinary Centres of America, VCA, part of the Mars Veterinary Group, where he served as Business Development Director. We are truly humbled to have someone of Tom's calibre and experience join us on a full-time basis to put a strong focus on driving revenue from our veterinary businesses. As we are transitioning from a research and development company to a commercial company, we're excited to strengthen the leadership team with these key appointments. We have been very fortunate throughout our 10 year history to have an amazingly stable, committed and hardworking team, which has grown in both strength and number. I would like to thank all of our team. I could not be prouder of their efforts. So from people to patents, a core element of our competitive advantage. We have a broad intellectual property portfolio, which covers both human and animal applications, and we continue to strengthen our protection. As of March 31st, 2021, our portfolio includes 28 patent families, 10 granted patents in the US, 14 in Europe, and a further 42 granted worldwide. We also have 93 patents pending. Our research and development team is both highly innovative and prolific and we work hard to ensure their inventions are protected to the fullest extent of the law so that we might gain commercial advantage. The first quarter of 2021 was busy from a patent filing point of view, and I also expect our patent portfolio to continue to grow in the quarters and years ahead. Our next P, publications. Given our comfort with both our IP position and the stability and robustness of the NUQ platform, Publications and abstracts remain one of our key objectives, and our list of publications and abstracts continues to grow. During the March 2021 quarter, data for NewQ was presented at two international conferences, and we collaborated on two clinical paper publications, with a third being published just last week, and a further two awaiting imminent publication. These publications are another very important step forward for our company. I'm extremely pleased that we continue to be on the very cutting edge of epigenetics and delighted that these publications span our four key pillars. These most recent abstracts and papers cover fundamental research into nucleosomics and UQ performance in lung cancer, the use of our UQ capture technology as a sampling preparation platform for mass spectrometry to aid biomarker discovery, and the performance of UQ nets in monitoring disease progression in COVID-19 subjects and in an animal model study in treatment of sepsis. In the relatively near term, we anticipate two additional papers to be published from our new QVET clinical studies. Many of these topics are perhaps a little too lengthy and in-depth science to cover on the call today. So I'll simply share a few highlights and perhaps try to answer any specific questions in the question and answer sessions later. In January, at the world's largest dedicated lung cancer conference, the WCLC, An abstract was published in conjunction with the National Taiwan University team. Our clinical paper, published in Nature's Scientific Reports in March, detailed our novel proteomics approach to epigenetic profiling of circulating nucleosomes in the blood of cancer patients. We believe the NUQ capture technology will be useful not only when it's used in combination with mass spectrometry to discover new biomarkers, as per this paper, but also as a DNA enrichment technology which could aid diagnosis, treatment selection, and both treatment and disease monitoring when used in combination with either sequencing and or our NUQ assays. The Nature Scientific Reports clinical paper was a great first paper on our NUQ capture, with further studies expected to be submitted in the coming quarters. From a NUQ NETS point of view, a clinical paper reporting the use of NUQ in monitoring disease progression in COVID-19 patients was published in March. Key findings, as Jake McAuliffe discussed on our last earnings call, are that nucleosomes were highly elevated in the plasma of COVID-19 patients, with a severe cost of the disease relative to healthy controls, and that both histone 3.1 variant and citrullinated nucleosomes increased with disease severity. In addition, data was published from an animal study of sepsis in a presentation given by Dr. Andrew Aswani, a consultant in critical care and anesthesia at one of London's leading teaching hospitals. This small initial study looked at the use of Volition's MuQ net assays to monitor treatment response to a novel therapy to remove nets from the circulation in a pig model of sepsis, resulting in improved physiological and biochemical well-being indicators of the pigs. Most importantly, the results showed that the treatment was successful and that our MuQ assay was the best and most practical way to measure the NETS response. The studies are now progressing to investigate further animal models and a first human trial is underway now. So busy start to the year with publications and we expect a strong pipeline in the coming quarters. And now onto our key updates around our four key pillars. Firstly, NUQVET. We beta launched NUQVET cancer screening test in Texas in the fourth quarter of last year. 2020. We are very happy with how the beta launch has progressed, giving us not only our first vet revenue, with Texas A&M University reordering on a monthly basis, but also in providing invaluable information for our anticipated launch nationally. Additionally, our vet product and the success of the launch has captured the interest of a wide range of industry players wanting to license or distribute our platform. This test is positioned for use in both the animal health check for older dogs, those that are seven years or older, and may also be a complementary test for younger dogs of breeds at high risk of developing cancer in their lifetimes, such as golden retrievers. The current test in its beta phase is only available at the GI Lab in Texas, A&M University, with our launch focusing on veterinarians across Texas. So, what is a beta launch exactly? The beta launch is to facilitate real-world learning from actual customers paying for the test to help shape the marketing mix before we launch nationally across the US, which given our positive indicators, we expect to be soon, likely in the next few months. Also, as importantly, it has also given us a chance to showcase the product to the very large multinational companies we are currently in very active discussions with, which is successfully concluded would help accelerate launches and sales worldwide. Given this is our very first commercial launch, we're using Texas as a test market to make sure all aspects of our product are properly tested before we launch in the US nationally and worldwide, and to help us address beforehand any issues with the companies who may end up distributing licensing our products worldwide as well. We have gained extremely valuable feedback on key factors such as the logistics of a veterinarian taking a sample, shipping, processing, reporting, and interpretation of the results, levels of customer service required, pet owner's feedback, and of course, the optimal pricing at all levels. Our team has also done a fantastic job in starting to educate key opinion leaders, oncology specialists, and GP veterinarians in Texas about Nutrasomix and raising the general awareness of the NuQVet cancer screening test. In terms of the commercial opportunity and the addressable market, cancer in dogs is widespread. It is a leading cause of death for dogs over the age of 10, And there are over 6 million new dog cancers diagnosed in the US alone each year. As cancer screening is not as commonplace in the animal health as it is in human health, we believe blood tests like the MuQ Vet Cancer Screening Test could help transform how veterinarians manage cancer in companion animals. Early diagnosis of cancer has the potential to help improve the treatment and quality of life, as well as providing valuable additional information to inform the clinical decision-making process. The new Q Vet Cancer Screening Test is a simple, low-cost, easy-to-use ELISA-based blood test, which we believe will help streamline this process for up to one-third of malignancies in dogs, including common malignancies such as lymphoma and hemangiosarcoma. We recognize the desire to receive revenue guidance now that we have our first commercial product and aim to provide this later in the year when the mix of our own launches and licensing of our technologies to third parties in both the vet and human spaces becomes clear. But as Tarek stated, we expect the revenue to be from both the VET test and from other NUQ products and to increase throughout the balance of the year. There is very strong interest in our VET product and the whole NUQ VET platform from a range of small and very large international companies. And we are continuing significant licensing discussions with several well-known major players in the veterinary space around the world. I look forward to updating you on the progress in the coming months. We believe the new QVET platform presents a fantastic opportunity for the company and are truly excited to have Dr. Tom Butera join the team to lead the efforts on that front. We have a busy second quarter underway in the veterinary business with a satellite symposium featuring Dr. Sue Ettinger at the world-leading VMX conference in Florida this May and Professor Heather Wilson-Robles as invited speaker to the ACVIM conference in June, in addition to further clinical papers that we expect to be published any day now. We are also making strong progress on the product pipeline for NUQVET beyond our first product and aim to share further details of further products on our next call. Lastly, we are making significant progress on the launch of NUQVET worldwide beyond our US launch and also expect to provide updates on this in the near term as well. All in all, UQ Vet is a hot space for us right now, so definitely watch this space for further updates in the near term. Our second pillar, UQ Capture. Beyond our exciting UQ Capture mass spectrometry clinical paper published in Nature Scientific Reports in March, we're very happy with our team's significant progress on this front. Their work highlighted for the first time that histone H2A1R3 cytonilin is, in plasma, upregulated in colorectal cancer patients and so could be a biomarker we target for future immunity assay development. Furthermore, it showed that the use of NUQCAPTCHA may open up the possibility of using mass spectrometry, not only for biomarker discovery, but also as a high-throughput platform for screening animal diagnostics. We aim for NUQCAPTCHA to be an important enabling technology in the liquid biopsy space. We anticipate further updates by clinical publications, collaboration announcements, and perhaps conference presentations in the coming quarters. We aim to launch our first product with this technology in 2022. Our team could not be more energized and excited by how our work in our third pillar, UQNETS, is progressing. And we believe it should be a very big part of our future success. Dr. Jake McAuliffe, our Chief Scientific Officer, discussed this in great detail on our last call. So I'll just provide a brief recap and update. Given the relatively recent understanding of the prominent role of both NETs, neutral extracellular traps, and nucleosomes in the pathology of COVID-19, sepsis, and many other diseases, we have been and continue to research the use of our proprietary technology in diseases with particular regard to NETs and mitosis. NETs are a vital component of our immune system. Nets are a web of chromatin material consisting of long strings of nucleosomes with added enzymes that damage and kill pathogens such as bacteria and viruses. Nets are produced by neutrophil cells, the most common white blood cells, in response to infection or injury. Nets are highly efficient traps that catch and kill pathogens at the site of infection or injury and prevent the spread of infection around the body. Whilst a vital component of the immune system, excessive production of nets at the site of infection can also damage the body's own cells and tissues. For example, a small proportion of COVID-19 patients experience excessive production of NETs in the lungs in response to infection by the COVID-19 virus, which may lead to severe lung impairment or even death. NETs are a complicating factor in a wide variety of other diseases, including respiratory infections, SARS, and pneumonia, as well as metabolic diseases, autoimmune conditions, inflammatory conditions, cancer, thrombosis, stroke, and sepsis. And elevated levels are a clinical complication associated with poor patient outcomes. As NETS material is made up of nucleosomes, Volition's MuQ nucleosome assay can detect NETS in minute quantities. We are researching the use of our proprietary nucleosome technology with a particular regard to the activation of neutrophil cells and release of NETS in disease. We believe the versatility of the NUQ platform and the range of applications for which these assays can be leveraged may help increase diagnostic power and monitor disease progression and potentially treatment response across a broad range of diseases that involve the overproduction of nets, such as COVID-19, pneumonia, influenza, and sepsis. From a sepsis product development perspective thus far, we have animal studies in the monitoring of disease progress and treatment efficacy which have demonstrated the use of NUQ's NETs as an effective monitor of dysregulated NETs production in vivo, disease progress, and treatment efficacy. Human studies in the monitoring of disease progress and treatment efficacy in sepsis are now underway at a leading UK hospital, and a potential US FDA 510 case study is in preparation. From a COVID-19 product development perspective, our COVID-19 studies in 2020 showed NUQ NETs nucleosomes levels strongly correlated with disease severity in the first wave of COVID-19 patients and mortality. We have now conducted studies of serial testing in the second wave of COVID-19 patients at leading UK hospitals to determine the predictive value of our test. Exciting times for sure, with further data due to be presented at upcoming conferences and potentially additional studies and collaborations to be announced soon. And finally, to our fourth pillar, UQ and human cancers. Unfortunately, given the pandemic, some, but thankfully not all, of our studies have been affected and we have pivoted to those areas we can still make progress during lockdowns. As previously reported, collection from the US EDRN study for colorectal cancer has been paused and collection for the blood cancer studies in the US has been slightly delayed and will give a full updated timeline in the near future. In Asia, we have reached our target patient cohorts for both colorectal cancer studies and the lung cancer study, all collected in conjunction with the National Taiwan University, a fantastic effort by the team there. We're excited to now be running the assays and finalizing the analysis over the coming months, with data due to be reported at future conferences. As discussed on previous calls, following the opening of Silver One, we have installed a service lab in the new facility which will undertake sampling processing for external parties such as pharmaceutical companies, biotech companies and academic researchers. We have branded this service UQ Discover and have already generated much interest. We have commercial interest from and quotes into multiple pharma and biotech companies and anticipate revenue from this activity in the second quarter and growing throughout the year. We see this as another key driver of revenue. Thus far, the projects we have been handling through our new Q-Discover service involve exploring the use of our assays to monitor the efficacy of our customers' therapeutics in development for cancer, mitosis, and other serious and or chronic diseases in both pre-regulatory and regulatory trials. These projects, if initiated, and indeed if the outcome is positive, could lead to more significant revenues for volition if our assays are proven as companion diagnostics to our customers' therapeutics. Emmanuel, our sales manager in Europe, is doing a fantastic job forging these relationships. I'm also very happy to announce today that we have signed our first distribution agreement with Biomedica, a distributor with over 40 years experience for the distribution of our CE marked NUQ kit in Central and Eastern Europe. We expect this to be the first agreement of many. Silver One is proving to be an excellent addition to Volition's commercialization efforts. We're now producing recombinant nucleosomes in-house and at large scale, building a library for sale through UQ Discover and also for internal R&D use. We have also developed the capability for many of the key steps within the production process for our components, such as the ability to freeze dry. And by the end of this month, we will also be producing our very own antibodies in-house. This is a great step forward in terms of supply chain management and will also reduce both the cost of goods and the cost of development. And lastly, I'm delighted that we no longer only manufacture our traditional plate-based format, but are now manufacturing, again at large scale, up to 20,000 tests per batch of our bead-based format to CE Mark standard. Thanks to Mahved and all the Silver One team, a great effort. And so, to the future. I'd like to reiterate our vision and what makes us so excited with our progress and our space. Pollition is an epigenetics company focused on advancing the science of epigenetics and exploiting these advances in human and animal health. This has been our mission since our founding and it's coming to fruition with our MuQ platform at the very heart of epigenetics. We believe the last decade of work at Pollition with our ever-expanding team in epigenetics puts us in an extremely strong position with our expansive IP portfolio to be a significant player in this key field. Overall, on so many fronts, with our ever-growing team and IP, I'm delighted with the progress we are making, and I'm excited by the momentum we have developed in the epigenetics field. In addition, our whole team is incredibly excited by the company's future opportunities. We aim to report throughout 2021 and beyond numerous key milestones now that we're in full swing in turning our platform into a range of products worldwide. We will focus on driving revenue in the coming quarters where possible during the pandemic in four key areas. Firstly, NUQ Vet products. Secondly, disease monitoring tests, such as in COVID and sepsis. Thirdly, NUQ Discover, processing samples at Silver One using our NUQ Discovery assays And four, licensing of our technology for others to commercialize. We also aim to publish data on multiple fronts across our four pillars. I, along with the rest of the board, and indeed the whole company, look forward to sharing the results of our key studies over the coming months and year with our optimized platform. Thanks for joining the call today. I very much appreciate it, given the busy earnings call season. We're happy to take questions now. Operator?
Operator
Thank you at this time will be conducting a question and answer session if you'd like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question to you may press star to if you'd like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys one moment, please, while we pull for questions. Your first question comes from the line of Kyle Nixon with Cancer Fitzgerald. Please proceed with your question.
keys one moment
Thanks. Hi, everyone. Thanks for taking the questions. So, I was wondering if you could talk about how the first Nictosis product can be launched and what the go-to-market strategy is. Specifically, I was wondering what the most likely use for the first assays is going to be. Again, I understand that it's probably for monitoring, but just like which disease, I was kind of thinking. And when you say launching the product on multiple platforms, you know, do you mean ELISA or BEADS when you say that? Or do you mean, like, you know, the actual immunoassay analyzer like the IDS? And then on the go-to-market plan, is there going to be, like, a beta launch in Europe and then, like, a broader launch later? Or how should we think about that? Thank you.
Cameron Reynolds
Thank you, Kyle, and thanks for your question. I'll just make – I'll answer them all and make sure – if I forget one of them, please return – So which disease? So a couple of calls ago, we thought perhaps a notosis slash influenza, sorry, for COVID in influenza might be the way to go. But I think given the waxing and waning of notosis from COVID, I think perhaps sepsis might be the one which is easiest to get the traction in. Certainly the easiest way to get large numbers in a trial, because obviously, as I'm sure everyone's aware, it is even during the pandemic, the biggest killer in hospitals. So it's obviously a very, very big problem and therefore much smoother ride to get the numbers needed for a trial. When we say multiple platforms, that's a good question. So we launched the VET on plates, initially where we are now. As you can hear, we've been working a lot on getting it on the machines. We're using IDS's machine, but we've also explored different machines we can use it on, the larger auto-analyzer machines. and we're also producing the beads at large scale now, so we can absolutely launch things, depending on what machines are available, but on bead-based machines. And adapting to a new machine seems to have taken just a few months ago. Then there's obviously new regulatory work, but the actual adaptation is quite easy. But we've also mentioned we're also working a lot on a point of care, both lateral flow, small machines, We've actually, Dr. Eccleston, who's in his new role in technology, has been looking at a lot of different options for just simple yes-no lateral flows, quantitative point of care, and also the small machines. I won't mention the companies because of confidentiality, but we're talking to quite a few, and we actually have our assays out to quite a few different companies for small point of care machines as well as lateral flow. So it's... What we aim to do with everything, as I think is clear, what we believe is this is going to be potentially huge in a very wide range of areas. So rather than saying to a customer or a government or someone, it has to be on beads or this machine or this point of care, we aim to offer a full menu. So I guess they say horses for courses. Sometimes plates are easier, particularly for research. The machines are very easy. If you want high throughput machines, The IDS machine, for example, can do 500 samples a day on quite a small machine. We're hoping in the future to license to groups like the big autoanalyzer companies. There's about half a dozen of them, Abbott, Roche, Siemens, and then develop the point of care, and that's quite developed, the point of care as well. So the go-to-market strategy, that's a very good question, and I think, as probably clear from what I said, we've been very, very happy with the results. in the diagnostic power, increasing diagnostic power, patient selection, also monitoring disease progression. Also, we're trying to show some prognostic value as well from the assays, which I think we may get to. So the go-to markets, I guess, like everywhere, you're looking at different regions. The EU to get a C mark could actually be reasonably quick. because the platform, we've CE marked very similar assays before, and then we aim to CE mark them on beads quite quickly. So once we have the chosen intensive use, and it could be one of a few of those things, and the samples run, it's just a couple of month process to finish off the CE mark. So what's caused us some time has been finding the right population to get a CE mark trial in. But as you mentioned, which indication? Sepsis can be reasonably quick because it's everywhere, as you know, and that's year-round, summer, winter, and in every hospital in the world. So I hope that answers all your questions. Oh, sorry, and the US. There is some talk of trying to get emergency use, which, of course, we try for for the COVID, but I don't know. I think it's certainly less than 50-50. We would get that. So it would be normal. The process we look to go through in a range of areas is to go to a CRO, collect for a 510 , and then go through that path, which Dr. Terrell has done quite a bit of work in a range of areas. So the cost of that is a few million dollars, typically. We tend to look at two or three million dollars, and it usually takes 12, 18 months for collection, plus all the regulatory timing. from whenever we start the process, which we're working on now, but we don't have a timeline from when we expect to start. I guess that'll be driven from the data we've got coming up in the next few months. We have our assays in the hands of a bunch, I think five or six different groups now, who are using them in their own trials to show the efficacy as proof of concept. So that's all coming together really well. Did that answer your question, Tom?
keys one moment
Thanks, Cameron. That was perfect. I threw a lot at you, but you did a great job answering. Thanks again. And I just want to thank you capture great publication with mass spec data. But when you think about like commercialization looks like a product to be out by 2022, which is which is positive. But, you know, when you think about like submitting for regulatory approval, how quickly could that FDA or see more kind of kind of current? And if it's going down the FDA pathway, would that be a PMA IVD? Because it's a screening test, it seems. And then I'm also wondering, like, you know, longer term, would partnerships with companies that offer that instrumentation like MassSpec or NextGen sequencers, would those partnerships make sense too to kind of couple the assays with?
Cameron Reynolds
Yeah, absolutely. So, we're obviously not in the sequencing nor mass spectrometry space. So, I think the NUQ capture from, and thank you, yeah, the paper was, I think, fantastic and great to be in Nature Scientific Reports. It was a real breakthrough. It shows that it's reproducible and robust like the rest of our platform. So commercialization, of course, anything which is going to be next year would not be an FDA study. It would be sold as a service for others to help. I think there's a lot of different ways by capturing and concentrating the chromatin fragments. We can help a range of different groups. And I or my team can go through that with you in greater detail. But anything which is, sorry, obviously selection or monitoring as part of a trial would take many years. That's certainly not going to be next year. But I think given what we're doing, like with Nuku Discovery, it's looking very good in a range of different areas for capture, and we'd be selling it as a service. And would we work with big companies? Absolutely. So I guess there's one very well-known big sequencing company, and there's quite a few big companies in the liquid biopsy space. And I think, like everything, we would look to launch our own products to show it works, to really get the ball rolling like we have in VETT. But we're very, very interested in licensing, particularly in CAPTCHA, because it would be something we believe, if it all works well, could be incredibly useful to them. So it's not something we have to commercialize ourselves. So I think once we've got the very good proof of concept from the next level, if that happens, we would quite aggressively look to license it out.
keys one moment
That makes sense. It doesn't have to be an approved assay. And then just thinking about the blood cancer study, it looks like the collections have been delayed a bit, which makes sense due to COVID. And I know there's going to be an updated timeline provided when it's ready. But is there any detail that you could share to help us understand why the studies were delayed? And I'm sure, you know, mostly it was due to COVID. How significantly could that delay the first 510K submission for DLBC? Because we talked about the timelines in the past. I'm just wondering how far those are now pushed out to DLBC.
Cameron Reynolds
Yeah, that's a very good question, and I don't have the firm timelines, and I don't want to update and have to re-update, but it's tough updating at the moment with COVID going. The primary reason was what you said, and as I'm sure you were, it's been a tough 15 months to be collecting trials in the US for cancer, and the EDRN study is still paused. I don't want to half answer that question because I don't think anyone really knows exactly what's happening at the moment with collections and So we're doing as much as we can to really work out the new time scale and how much is delayed. But I would strongly expect it's going to be at least a quarter or two, given everything. But that's just speculative at the moment. And we're looking at ways perhaps we can get things back on track time-wise. But as I said, yeah, it's just been a really tough time the last 15 months with the pandemic to keep collections on track in the US. But we'll have a full update as soon as we know. I'd strongly expect that's going to be before or at the next queue.
keys one moment
All right. That's understandable, and it's very fair. I just had one last question. I think it's going to be quick. Sure. On the biomedical distribution, I guess, agreement, I just want to confirm, are those for the RUO kits or is that for something else? I just want to make sure I'm thinking about that correctly.
Cameron Reynolds
I don't know. That's for the new queue first, which was – you know, we got the kit C marked – for the blood cancers in Europe. As you've seen in the dogs, it works very well in the blood cancers and they're looking to see if they can get some traction in Eastern Europe. And as that's not one of our key markets, they're quite a large company, as you know. This is both sides just kind of feeling each other out, if you will, seeing if they can find a market in Eastern Europe and if we like working with them. So they've got until the end of the year to see if they think they can make a go of it in Eastern Europe, given the data they have, or collect more data. So we're getting a lot of interest from different groups just kind of trying to work out how they can be involved. Is Nuku going to be a thing? And as they're a very good company and quite an established company and it's a footprint where we didn't really have any traction in Eastern Europe, we thought it was a good thing to do. And there's a lot of these sort of smaller deals bubbling as well as the bigger deals we talk about as we sort of work out ourselves and they work out how the patchwork is going to work in all our different products. So it was good to get this first one, the first run on the board, if you will, and we'll see how that goes between now and the end of the year and see if we want to continue the relationship, and they do, but it's a good start.
keys one moment
All right, makes sense. Thanks for the clarification. I will leave it there, but congrats on the progress, guys, and I'll talk to you soon. Thank you. Thanks a lot for your time.
Operator
Your next question comes from line of Bruce Jackson with Benchmark Company. Please proceed with your question.
Bruce Jackson
Hi. I'd like to ask a couple of questions about the mitosis assay. So you've got the one COVID-19 study where you've been collecting the serial samples. Have you submitted that data yet for pre-trial? them in conference? And if so, which conference would it be presented at?
Cameron Reynolds
Yes. So we've gone a couple of different paths. We tried to do a big sort of study and that's been very tough to get off the ground because everyone quite naturally is concerned with getting their sick well in the emergency wards. So collecting serial samples and it's not a complicated trial, but it's obviously something which takes a lot of attention away from And a lot of them have been obviously extremely busy, especially in London in the last few months. So we've been working through a few different networks of incredibly good people in the COVID and social space. I guess the hospitals we've talked about a bit, but very, very large hospitals, the best ones in London and some of the best in the world for COVID work. They have submitted to conferences. I believe the next one, They tend to be two or three months ahead. That's the only problem with when you do it like this. They do it through publications, which is good. I mean, it means they're very happy with the data and they're very comfortable, but it just takes a little more time to conferences don't happen the next week from when the data comes out. But the next one is July. And we have, as I said, a bunch more out there. So I would see a steady stream of them coming through the rest of this year, both in the pig animal model for sepsis therapy and the human model. model, also in sepsis, also in COVID. And I can't give you the details now, but there's several other areas of notosis where we have been very active in supporting groups who have research going in that field with providing our assays and our knowledge of notosis to see how it goes with them. So the first one is, I guess it's a bit over a month away, and there's a large range of them coming through the year. And I think we've been extremely encouraged with the work that we've been doing with our partners who are world renowned specialists in COVID and sepsis and in emergencies. And we're also attempting to now get the size we needed for studies, which can then become the regulatory work for CE mark, which again, the studies is the delay. Once we have that, a CE mark can actually happen quite quickly because our platform is so well developed. It's a matter of small number of months once we have the population and at run. And as I discussed with Kyle, particularly with sepsis, you can get large numbers very quickly. Summer, winter, rain or shine, there's always sepsis in a hospital. So I couldn't be more happy or excited with the way it's going. Our platform, we've been shipping kits to very busy, very independent people. The feedback we've got has been nothing short of excellent in every case, not only in the quality of our assay, but how well it is at doing different things with regards to the ptosis. And as you said, not just the diagnostic, but also potentially as a companion diagnostic or even patient selection for treatments for clearing out of nets. So potentially a really, really big market and something we're very excited about. And there'll be a lot of data through the year. Does that answer your question, Bruce?
Bruce Jackson
Yes, and if I could follow up on the sepsis application. So, do you also have data in-house for that use of the assay, and has it been submitted for presentation?
Cameron Reynolds
Yes, yes, and lots more to come. So, a bit of a presentation. So, the data, we have a lot we haven't published. We're working on through now with them. Things have been published, as well as, don't forget, it was published in the pig model on the therapy. And I think, as you can see from the poster, our assay was an extremely good marker for the disease progression also, and worked incredibly robustly and stably. And we're also, this was all on a plate system. Obviously, you probably want more things faster in a very situation than just every six hours, but that is quite fast. So we're also putting the sepsis platform on beads so it can be done in 45 minutes and also potentially point of care. So theoretically, you could have almost instantaneous measurement of your NETS level. And if you think for those who are wondering how that's useful, I think, you know, Bruce, if you're in hospital, sepsis is a big killer. It creeps up on you and it kills you for two main reasons. One, it's very early to diagnose early and really get ahead of. And two, the treatments aren't actually that great for it. And there's often a lot of, there aren't many, so there's no good diagnostic for it, really, certainly nothing in real time. And there's no really good therapy, but that's partly because there's not a good diagnostic. So I think this could be really, really something very, very helpful to a lot of people. Okay, good.
Bruce Jackson
And then with regard to the contract research business from Silver One, you've been talking to some large companies. Do you have any contracts in hand yet? And then if you could just give us a little bit of a flavor for the types of studies that they're contemplating. So are they looking at the nucleosomic testing as something where they're trying to get a handle on it? Or do they have an actual application in mind, for example, as a companion diagnostic?
Cameron Reynolds
A lot of both, but mainly where they have a purpose in mind. A lot of monitoring of efficacy of their therapies in development, in cancer, in mitosis, also in the animal space. We've actually worked with a few groups looking to use their assays, obviously in the dog space as well. But so far as, so yes, we have a handful of, it's actually only been quite recently we even started, so we've been very happy with the response. We have one sales member, Emmanuel, who's been shaking the tree, and it turns out, it looks like there's a steady demand for epigenetic profiling. So yeah, it's for particular uses. So as we talked about the revenue, it can be very small, it can be very large, depends on where you sit in that continuum. Typically starts out, it'd be more in the sort of small tens of thousands of dollars. A big quote over a sort of six month period could get into seven figures. So that's the kind of the ballpark you're looking at. But of course, if it becomes part of the 510k or FDA study, then you're looking at a much larger amount, but obviously most things don't progress to that level. But it's a very good way of getting known, very good way to get more publications, very good way to get, so it's, yeah, I would expect to see, you never know, the contracts, so the discussions might go nowhere, but there's certainly a lot of interest. Some of them are quite well advanced. So I'd be surprised if we didn't close a few of them in sort of short to medium term. And it's just a good way to get things moving. And I think it's very encouraging to see Silver One is now, I think there's 12 or 13 different recombinant nucleosomes we're producing. We can offer a service for, I think, about 15 different nucleosome assays. And potentially, you know, NUQ Capture is a service as well, which could be the revenue next year. And I believe, as far as I know, our service is quite unique in the breadth and abilities of what we can do. And as I'm sure you're aware, Bruce, epigenetics is really taking off. So it could be a very good process for us.
Bruce Jackson
All right, perfect. Thank you. Thank you, Bruce.
Operator
Your next question comes from the line of Jason McCarthy with Maxim Group. Please proceed with your questions.
Jason McCarthy
Hey, Cameron. Thanks for taking my question. This is Michael Kunowich on the line for Jason. All right. So, I'd like to see if you can kind of give us just a bit of a deeper status update and walk us through the steps that you need to take for the human diagnostics platforms. You know, we know that the big study in blood cancer is kind of on pause, but what about the other programs like lung cancer and colorectal? especially now that you have the – it seems like you got full enrollment on the National Taiwan Studies?
Cameron Reynolds
Yes. So I guess the human studies. The reason we did the blood cancer first is just one assay or maybe two assays got fantastic results. I mean, look in the vet space. We're high 80s or 90s AUCs accuracies, which is quite remarkable for a very low-cost, easy-to-use blood tester. But obviously in the lung and colorectal space, it is more work because we've always needed to do a panel. And so you have to get a broader range of assays ready. And also on a platform, that's not something you'd use four or five different plates for. So it would have been very hard to do a beta launch in lung or CRC just on plates because you'd need a wide range of assays. So that's actually, we haven't focused a lot of efforts on the back end of finalizing all, because we only have a relatively small team. The fantastic thing is our optionality now that we can pivot to the vet space where, again, a very simple assay has got spectacular results. Natosis, where a very simple couple of assays, which we can launch very quickly and easily. I think if it hadn't been for the pandemic, we would have spent a lot of time finalizing the platform for a broader range of assays, because to bring each assay to a product stage obviously takes a lot of background work. It's not incredibly detailed work, but it's a lot of detail. So you have to use, it can take six to 12 months per assay. I mean, you can do them concurrently, but each one can take a lot of work to just making sure they're fully robust and reproducible, which of course we have done in the assays which are now ready for product in the vet and the toaster space, but we still need to go through that. But while they're still collecting and the process particularly, obviously Taiwan's not going to be the biggest market. We are talking to a major player in Asia. I can't mention the name, but if I said it, you'd know it, who they are, about assisting us with launching on a more simple platform in Asia and one particular part of Asia. So we're just trying to work out now how much effort we put into, because obviously it's still going to take, that's where the collection happens, but they're not US regulatory trials and they're probably not good enough for a country in Asia. Except it's a more proof of concept. But I think given how strongly VET has taken off and that could easily be a very, very large market and so could dentosis with a platform we have ready. We still have to go through a bit of the background work to really finish off the lung and colorectal So given the fact that it's paused in the US and I think we'd probably focus on getting the blood cancer in humans product out first because that is very close to product ready because it's a very simple panel. And to be 100% upfront, we've never got 90% AUC with one assay in lung or colorectal. It's always taken a panel, which is understandable. It's a solid tumor and a liquid tumor. So we do have to do quite a bit more work. I can run you through more of the details if you want after, but we still have more work to do on the background of lung and the colorectal. But given the optionality, we thought we'd go where the very low-hanging fruit is at the moment in the blood cancer, natosis, and the vet space. All right. Thank you very much.
Jason McCarthy
And then I'd like to ask also about the H2A103 histone that you discovered through the CAPTURE program. Is that something that you could add to, you know, kind of the mainline NUQ colorectal cancer assay, especially while the US EDRN studies on PAWS?
Cameron Reynolds
Absolutely. So actually, and that's, it's not necessarily a bad thing. We have them being on PAWS gives us more time to adapt the platform. I mean, getting a colorectal panel is a lot of work. And we can add those assays to it. Absolutely. And we're actually looking for, it's been proven very helpful in biomarker discovery. So that one, and I was certainly looking at others as well, have never been described as being different. And from the mass spectrometry, it certainly appears they are. So we can 100% add any assay theoretically. And because what we have is a bit of a process now where we can make the recombinant nucleosome, the antibody in-house and make the assay. So the short answer is absolutely. And that's one of the many reasons we're doing the NUQ capture program is to also add new biomarkers that have not previously been described.
Jason McCarthy
All right, thank you. And then just one more, I'd like to ask, you know, it's been around seven months since you've started the beta launch for NucubeVet. I want to see if you could talk a bit about, you know, what you've learned so far in the vet space and how you can take that and kind of apply it to more of the national launch later this year.
Cameron Reynolds
Yeah, it's actually, we've learned a huge amount. I'm really happy and glad that we did it the way we did And learning also comes from the people. Dr. Tom Butera coming on board. He's a very well-renowned executive in this space. And leaving Mars, which is the biggest vet company in the world, and coming to ours, which I'm guessing we're probably one of the smallest, really shows his faith in what we're doing. And he's been tremendously helpful in guiding us in some of these issues. But I think to give some flavor, there's a huge amount of things to learn. Obviously one very important factor is pricing. Obviously, we want to maximise the revenue, and so I think on the national launch, we will be adjusting the price. You'll see all of that to really maximise the level. Packaging has been very important. The need to be on ice obviously is a big difference in the amount of work required if it's frozen or at two degrees. Also, we've learnt it's very good to ship a box to the vet so they don't limit the amount of work they have to do. Also, a lot of vets also just want to package it up and send it off to a centralized lab, you know, like there's two big companies or around the world, several big companies which do that. If you're doing six other tests, it's sometimes easier to tick an extra box. So I think that'll be a big part of it. Yeah, so we've looked at every single aspect. Now, not the test itself, that's worked incredibly well, but just All those nuances are incredibly important to get right. And I think, as I've discussed, but I couldn't reiterate enough, that what it's also done is proven that we have a product to the big vet companies and small vet companies. And I think we're in a really good position because as far as we're aware, we're the only real product out there that can show any real efficacy in cancer in dogs. And there are several big companies and several insurgents in the business, and there's only one of us. So I think puts us in a really good position and it's I think it's very fair to say they're taking this very seriously. We're in very serious discussions and I think that's going to be a big part of the mix as well. But that's kind of what we wanted to do all along. I think providing a solution ourselves is a good way to move forward, prove it works and get it all fine tuned. But also, you know, and this is true in the human space, but certainly also in the vet space, the companies have hundreds and hundreds of salespeople. and reps worldwide. So I think that's going to be, hopefully, a big part of our mix as well. So all in all, I think it's been a really good process for us and it should make a deal much smoother if we end up doing one with one of the majors and also really smooth launch of our product nationally and internationally because we also expect to be launching internationally in Europe and in Asia in the coming quarters as well because there's obviously a big need there as well.
Jason McCarthy
All right, thank you very much.
Cameron Reynolds
Thank you, Mark.
Operator
Your next question comes from the line of Nathan Weinstein with Aegis Capital. Please proceed with your question.
Michael
Good morning, Cameron and Volition team. Thanks for taking my questions. I suppose just to start on NewQVet and NewQDiscover, kind of as we think about the next few quarters on those programs, should we be sort of thinking about a sequential revenue ramp
Cameron Reynolds
I'll deal with, well, I'll do one at a time. So new cuvette, so, you know, the sales, they've been ordering as we talked about. Each order is enough to do, I don't know, not quite a couple of hundred dogs, but at $46 each, you know, 25,000 revenue. You can work out roughly how many that is. It's in the hundreds. We're not putting a lot more on very much at all marketing in at the moment because we're answering all these questions. So I don't expect that to marketly go up in the next sort of few months because we're We're putting all the effort into the negotiations for our own national launch and also, of course, perhaps licensing and the other processes. So there has been good interest, but we're using this much. There's no point spending a huge marketing budget now when I think we're going to nationally launch with all the tweaks that we've been using. So, yeah, I would expect it to rise, but I think the big change will be after the national launch And I think if we can get a licensing deal, that would absolutely supercharge. Because as I said to Michael, the big companies have hundreds and hundreds of salespeople worldwide. So it's obviously a whole different potential to be quick in ramping up if that's done as a deal. And you could discover, yeah, it's going to be a bit lumpy because I said some deals can be as low as $10,000. Some could be over $100,000 or euros. So in one quarter you might get a couple, in the next quarter you might not, but I think through the year I'd expect to see a few, and I'd expect that to pick up strongly through next year as well. We will provide guidance as soon as it becomes clear of the mixture, how Discover's going, how VET's going, and potentially licensing deals. We have a potential licensing deal being discussed also in the human space In Asia, that may or may not happen, but that would also change how things look as well. So the package should become a lot clearer through the year, but I'd expect to see a slow, steady gain through the VET, and then the big movements would be either on the national or international launches and or on a licensing deal. And Discover will pick up, I think, quite strongly through the next few quarters, but could be lumpy. Some quarters could be quite good and some could be smaller just because the nature of how it looks in deals. Does that make sense? Thank you.
Michael
Yes. Thank you, Cameron. That's very helpful on the revenue front. And then maybe just thinking about margins. I've always thought of NUQ as having a particularly attractive cost of goods. So I just wanted to get your thoughts on the cost and maybe compare contrast to other testing modalities that are out there. The costs are attractive and then how silver one plays into that in the long term.
Cameron Reynolds
Yes, it's very interesting. In some ways it follows, I obviously have an MBA, so I've studied a few of these things. It follows in some ways a kind of a software model in the sense of our whole idea in all this is not just to offer a license, but sell the key components so that we can maintain quality, also have a good idea of actually how many they're selling, and particularly in developing countries and countries where you might not see a royalty get revenue early on. So at the moment, on the plate-based format, it costs around $4-ish, $5 per test, but sometimes you have to do repeats, so you might have to, might be a few of those to get it. Once you're on beads, there's no need for, or very few repeats, and the cost goes down a lot, maybe even half or less than that. And we're in the process of changing over to beads now from the different platforms. And so silver one, So I think sort of moving forward, we're seeing in the vet space, obviously we have a very good margin, and so does everyone in the chain. And I think we're looking to make it a mass market product. I think it's something which, particularly as part of the wellness screening test, could easily be something which we target to having several hundreds of thousands or millions of tests per year. And I think perhaps we need to be at a slightly lower price point. But given the fact that our cost of goods are going to be dropping a lot It's probably a very similar margin as we have, but just a lot more throughput on the product front. So I think we're in a very unique position because we have something which we can, when the cost of goods are as low as ours are, and I think at full production, we could be at just a few dollars per assay or even less if it's in simplification. you can kind of put the, we have to recoup obviously the large investment we've made in this space, but you can put the product at pretty much any price and have a very attractive margin. And that's, we're all about a volume business, so we don't want to sell a few things at a very high price. We want to really dominate, not just on the plates, but magnetic beads, also on the point of care, and make it a test. And if we do progress on the sepsis side, it's something which I think could be taken by a very large percentage of people in hospital, regularly to check to see if they're starting to develop sepsis, for example. And to do that, you can't be $200 or $300 a test. You'd have to be well below $100, I think, if it's going to be something which is really, really mass market. But then the numbers of tests go up massively. So either way, we have a very high margin, I think, that we're really pushing for volume of sales.
Michael
Thank you, Cameron. That's very helpful. Appreciate it.
Cameron Reynolds
Thank you.
Michael
Thank you, Nathan.
Operator
Ladies and gentlemen, we have reached the end of the question and answer session, and I would like to turn the call back to Mr. Cameron Reynolds for closing remarks.
Cameron Reynolds
Thank you, everyone. I understand you're all very busy, and I really appreciate your time. And please keep an eye on us over the next few months and quarters and all the way through next year. We have a very strong team, I believe. We have a strong disbalance sheet we've ever had. Fantastic platform. But now we absolutely realize it's about making products and getting revenue. So now we have a good commercialization team in place, and the first products, we're going to be taking that very seriously. So thank you for your time. This concludes today's conference. You may disconnect your lines at this time. Thank you all for your time.
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