Microba Life Sciences Limited

Good morning, everyone. I'm very pleased to share an update on our progress following the close of the quarter ended 31 March, 2024. This is our standard disclaimer. I'll just move quickly past that. Firstly, I want to take a moment to recap on Microbe. Microbe is a medical diagnostic and clinical stage therapeutics company that's unlocking the medical application of the microbiome, which is the trillions of organisms that live in and on our body which are critical to our health and the development of disease. Founded on world-leading metagenomic microbiome and microbial genomics analysis technology with a clear vision that that technology would lead to new diagnostic testing solutions that become a routine part of healthcare and lead us to the discovery and development of novel drugs for major chronic diseases. We've invested over multiple years to develop two diagnostic testing products, MetaExplore for diagnosing gastrointestinal disorders launched just last year and MetaPanel for diagnosing gastrointestinal pathogens launched just last month together with Sonic Healthcare. In parallel, we've invested in three therapeutic programs spanning inflammatory bowel disease, immuno-oncology and autoimmune disease. We've successfully completed a first in human phase one clinical trial are at an advanced stage of preparing for a phase two trial and progressing a compelling pipeline of preclinical leads for multiple indications. And this has not happened overnight. It's been years of work that's now materializing in a significant commercial opportunity that lays in front of us. Up front, I want to highlight some of the recent milestones and key achievements from the quarter. Firstly, let me take you through the strong numbers We delivered 4 million in revenue, which represents 82% quarter-on-quarter growth and around 300% year-on-year growth. This was driven in two parts. Firstly, by strong underlying growth of Microbe's existing testing business. And in particular, it's important to call out the accelerating growth of our meta-explore sales and revenue in Australia. And I'll give some more detail on those numbers in a moment. And secondly, by realising our first full quarter of revenue from our recently acquired in vivo clinical business in the United Kingdom. Aligned to this growth, there are a range of milestones and highlights from the quarter. Firstly, for microbus testing business, strong growth for our gastrointestinal disorders test matter explore in Australia, as I just mentioned. with 1,100 tests sold during the quarter, representing 28% sales growth quarter on quarter, and over 1,100% growth year on year. And we now have over 1,400 healthcare professional accounts registered, which is up from around 1,000 just in the prior quarter. In vivo clinical achieved 2.2 million in sales for the quarter, which is delivering aligned to our expectations. And they're intensively focused on targeting growth activities within their existing 5,900 healthcare professional accounts and 200 accounts newly registered during the quarter. But finally, our gastrointestinal pathogen test metapanel launched Australia nationwide with Sonic Healthcare. with first sales achieved across all states, including New South Wales, Victoria, Queensland, South Australia, Western Australia, and Tasmania. Secondly, for microbus therapeutics business, for our inflammatory bowel disease program, further progress was made to prepare MAT315 for a phase two efficacy trial, and new data was produced supporting the multi-modal mechanism of action for MAT315. For our Immuno-Oncology program, new preclinical data was generated and our clinical data set was doubled to more than a thousand individuals to support lead candidate selection. And finally, our Autoimmune program in partnership with New York Stock Exchange listed Ginkgo Bioworks, stage two functional screening there is now 70% complete. Data was generated spanning multiple areas of biology, which Trent will touch on. And the program remains on track for completion of that discovery program in Q4. So now let's go a little deeper on the testing business and growth over the quarter. First starting with Meta Explore in Australia. So the team has been executing over the last six months on a range of strategic clinician engagement and sales efforts for this new product. And we're now seeing those activities materialize into an acceleration of growth in test sales in Australia with multiple growth campaigns that were executed across the period, including direct clinician engagement, webinars, new support materials, EDMs, and social media engagement, all rolling up into 28% quarter and quarter growth and over 1100% growth year on year. A leading indicator of growth is healthcare professional accounts. And it was pleasing that we saw over 30% growth in healthcare professional account registrations in the quarter, which delivers a strong pipeline for continuing sales growth over the quarters ahead. Secondly, Metapanel in Australia. We launched this world first diagnostic gastrointestinal pathogen test nationwide together with Sonic Healthcare. Aligned to this, We achieved first doctor referrals and sales across all states of the country. Launch events were held across New South Wales, Victoria, Queensland, and Tasmania. And we have the next launch events scheduled for the next couple of months across the ACT, South Australia, and Western Australia. And here we've been focused on executing a sales strategy which is broken into two stages. Stage one focused on gastroenterology specialists. Stage two to target general practice doctors. The key here is to educate and get the specialists on board and utilizing this new test. They are the medical thought leaders here that typically drive changes in the standard of care for GI symptom management and their engagement and buy-in can then drive behavior down into general practice. Executing on these planned educational activities, marketing engagement strategies, and KOL development, we expect a gradual continued growth in volumes, ramping into meaningful sales volume and revenues into FY 2025. And last, our United Kingdom business, Invivo Clinical. We acquired this leading UK microbiome company, Invivo Clinical, in December 2023, and the March quarter was the first full quarter as part of the micro group, which delivered 2.2 million in sales. Financial and corporate integration aligned to that is now complete. And the UK team, as I mentioned before, are intensively focused on sales growth within their existing 5,900 accounts and activating the 200 new accounts registered during the quarter through a range of targeted sales, marketing and education activities. Importantly to call out, this is all prior to unlocking growth synergies, which were fundamental to our acquisition strategy. First step was to bed down the acquisition and bolster their sales resourcing, which is going well. Second step is to bring in the MicroEver synergies in a controlled and staged manner, starting with the launch of MicroEver's MetaExplorer product into the UK to drive growth into Envivo's gastrointestinal testing. which represents more than 80% of their testing sales volume. Aligned to that, the launch of MetaExplore is scheduled to occur in next financial year, FY25, and we'll share more details on that in the near term. So a great quarter of growth for our testing business, but before heading to Trent to update on our therapeutics business, I just want to take a moment to recap on our testing products. an overarching strategy here in diagnostics. The foundation of this is that we have two tests. The first test is MediPanel, which launched just last month in Australia together with Sonic Healthcare. This test is a diagnostic gastrointestinal pathogen test. Gastrointestinal pathogen infections are prevalent, and when a patient with gastrointestinal symptoms presents to the doctor's office, The first question they'll ask is, is this a pathogen causing these symptoms in my patient? And MetaPanel is the most comprehensive test now available for a doctor to answer that question by several orders of magnitude. The second test is MetaExplore. This test is a gastrointestinal disorders test. Gastrointestinal symptoms are common. When a patient with gastrointestinal symptoms presents to the doctor's office after ruling out a pathogen, there is another question that they're trying to answer, which is, is it a functional microbiome or gastrointestinal disorder causing these symptoms in my patient? And they previously not had sufficient tools to answer this question. And MetaExplore is now the most comprehensive test available for addressing that. These two tests work in the clinician and patient journey to support a large and underserved patient population suffering from gastrointestinal symptoms. So let me take you through that journey. The patient presents to the doctor with a gastrointestinal issue such as diarrhea, bloating, visceral hypersensitivity, and associated pain. The first question the doctor wants to answer is, as I outlined before, is this a pathogen causing these symptoms? And prior to the launch of MediPanel, the largest test available that's routinely used can detect 22 pathogens, which is less than 20% of the known clinical If no pathogen, the second question that they'll want to answer is, is there something more sinister here, particularly inflammatory bowel disease or colorectal cancer? And there are standard tests for this. And if positive, they'll be triaged for colonoscopy for a definitive diagnosis. If no pathogen, no inflammatory bowel disease or colorectal cancer, that final question that the doctor wants to be able to answer is, is this a functional gastrointestinal disorder or a mental health disorder? And previously, there's been no way to answer that question using a diagnostic test. The patient therefore gets a irritable bowel syndrome diagnosis by exclusion and triage for nonspecific diet and mental health support. Using microbe as next generation diagnostic tests, we're completely transforming this care pathway. The first question of, is it a pathogen causing these symptoms? Rather than testing for 22 pathogens, the doctor can automate a panel and test for 175 pathogen targets, enabling them to confidently diagnose or rule out a pathogen as the cause of the patient's symptoms and employ a targeted antibiotic treatment. If no pathogen for the second and third questions, the doctor can order Meta-Explore, a comprehensive gastrointestinal disorders test, enabling them to identify or first to identify or rule out inflammatory bowel disease or colorectal cancer risk aligned to the standard of care. And then answer the question that they've not had the tools to address before, which is, Is it a functional gastrointestinal disorder, including potential microbiome dysbiosis, or a mental health issue through brain-to-gut signaling that's causing these symptoms? And Meta-Explore enables them to make a functional microbiome or GI disorder diagnosis and develop a personalized treatment plan, or rule that out to pre-arch for suspected psychogenic IBS to be managed through mental health support. a significant transformation to the standard of care for the diagnosis and management of GI symptoms, which is an issue that impacts over 30% of the population. So our testing business is gaining momentum at the forefront of microbiome and metagenomic-based medical diagnostics, and I'm genuinely excited about the growth ahead. So I'll now hand over to our Senior Vice President of Therapeutics, Professor Trent Munro, to provide the quarterly update on our therapeutics business and our progress there. Trent, I'll hand over to you.

Thanks very much, Luke. So give an update on Microbe Therapeutics. Microbe is in a prime position at the forefront of microbiome drug development through our ability to pinpoint therapeutically relevant biology using an advanced artificial intelligence machine learning approach to the development of precision live biotherapeutics. Sitting beneath this we have the world's most advanced bioinformatic pipeline for metagenomic microbiome analysis. We have a large human data set with deep health metadata powering our AI ML discovery engine. And we have a pipeline of single strain live biotherapeutic candidates. This places us in a unique position and differentiates us from our peers in terms of the way we think about microbiome drug development. This is because our pipeline is delivering compelling biology with distinct mechanisms of action. These products are orally delivered, have an excellent safety profile. And importantly, something we've been working on here at Micropro with our partner Bactera is how we demonstrate and our ability to scale the manufacturing of this for future clinical and commercial use. matching this as we've spoken about, we have a strong multidisciplinary team here at microbe from with experience around the globe, and a range of other variable global partners that support our efforts. To summarize our progress over the quarter, Luke touched on this earlier, inflammatory bowel disease program is progressing towards phase two readiness. And we've generated some really important new mechanism of action data over the quarter on our product MAP315 and its role in inflammatory bowel disease and particular ulcerative colitis. Our immuno-oncology program is advancing towards lead candidate selection with some new preclinical data generated. And we've also more than doubled the size of our clinical data set that we use to understand the role of the microbiome in cancer. Lastly, our autoimmune program that's partnered with Ginkgo Bioworks in Boston is now 70% through our stage two functional screening. And that program is on track for completion in Q4. Just to touch on two aspects to our platform. One is, of course, that we use this proprietary data bank that we have, which is a combination of health metadata and microbiome data using our AI discovery methods to translate that through to understand which parts of the microbiome are useful as potential treatments and live biotherapeutics in a chronic disease setting. We've been able to do that across a broad range of different therapeutic areas. And this just exemplifies our ability to do that. Diving in a little bit deeper in terms of what that actually platform, what that platform looks like for us, the three components that sit there are really our human data-driven approach that I just described. And there's some metrics here on the scale of that. Our ability to analyze that data using advanced artificial intelligence and machine learning approaches. And you can see some of our compute there. And then lastly, the conversion of that into disease relevant activity to develop these precision microbiome therapeutics. And we've highlighted some of the underlying power that we have there in this slide as well. As we think about the platform that we have, our inflammatory bowel disease program is now through phase one, heading towards phase two. Immuno-oncology, as I mentioned, progressing rapidly through preclinical assessment towards the candidate. And our autoimmune disease program now generating a huge amount of valuable data with our partner Ginkgo, which we believe is unparalleled in the microbiome drug development field. Importantly, each of these programs represents a significant commercial opportunity for shareholders. And just to reiterate, our strategy is unchanged. We plan to do the initial preclinical and clinical de-risking and then partner with strategically aligned folks for later development. We've never planned to be a late stage drug developer and capitalize alone large clinical trials. I plan to share more shortly on our phase two partnering and funding strategy, which importantly is dedicated to being non-dilutive to our shareholders. Just to dive into a quick update on our programs to give you a little bit of color on our inflammatory bowel disease program targeting a novel therapy for patients suffering from ulcerative colitis, particularly in our first intent in the mild to moderate setting prebiologics. In December, we completed our phase one first in human clinical trial of this lead candidate, MAP315, demonstrating it was safe and well tolerated. In this quarter, we continue to advance towards phase two readiness. We also generated some important data to further support MAP315's multimodal mechanism of action in promoting mucosal healing and immune homeostasis. You can see some of that data here in terms of the new signaling pathways that we've identified as being involved, as well as some reg data that we know is important on that immune side of the equation. We have decided to strategically bolster our CMC package to support that at-scale GMP manufacturing I mentioned earlier, and that's critical as we set up for our IND submission. We've also been active in market. I just got back from a range of meetings in Boston. I look forward to sharing more details on this strategy, as I mentioned above. For our immuno-oncology program here, we're targeting the development of a therapeutic to improve response rates for cancer patients receiving immune checkpoint inhibitor therapy, which as many of you will know, has become a standard of care in a number of cancer indications. Across the quarter, we generated further immunological data supporting the mechanism of action for these leads. We also significantly expanded our data position, doubling the size of our clinical data set to around 1000 individuals, further supporting our ability to identify lead candidate and our decision making there. Something that we haven't had a chance to update on in a while has been the program that we're participating in with the Omico Consortium as part of their prospect study. This is a large landmark cancer genomics program in which we've now accumulated over 1,900 clinical samples from cancer patients across Australia, which is building a unique resource and future data asset to support the program. For our autoimmune programs I mentioned, partnered with a New York Stock Exchange listed Ginkgo Bioworks. Here we are targeting diseases such as lupus, psoriatic arthritis, and autoimmune liver disease, where there's strong evidence that the microbiome is playing important roles in maintaining this immune homeostasis. In terms of the program, we're about 70% through our stage two functional screening. The data generated here continues to expand and we've been able to look at things like fibrosis, gut barrier integrity, nuclear receptor biology, really exciting biology around the role of microbiomes and their ability to act on GPCRs and other broader cell functions such as ER stress. And the important takeaway for this program is we're on track for Q4 completion. Another program which we recently updated on was the movement of our partnership with IFF into a second stage of development. What's been happening in the quarter is really strengthening the technical part of that relationship, working with the team at IFF and the internal team here at Microbah. And this program is progressing nicely on track. As a reminder, the goal is to leverage our data-driven platform and drug development capabilities to identify novel allergy treatments from the human gut microbiome. Success here would see a product developed in partnership with IFF to take up their option to license that product, and they commercialize the product, which generates royalties back to microbots. I won't go through this slide. We've shared it a number of times. It's just to say that we've really worked hard at being at the forefront of the technology evolution we see supporting microbiome therapeutics and our approach to develop precision single strain live biotherapeutics. With that, I'll hand back to Luke to talk about the milestones ahead and close out the update.

Thank you, Trent. So it was a great quarter of strong sales and revenue growth and advancement of our therapeutic programs, but I'm even more excited about the quarters ahead. On top of continued strong sales and revenue growth, we have a range of important activities and milestones over the next quarter, which we expect to advance the company and unlock value for shareholders, including sharing the next phase of our US commercialisation strategy that we've been working on, continuing to expand the metapanel launch activities in Australia with Sonic, and advancement across all three of our therapeutic programs aligned to strategy. As at 31 March 2024, we had 23.6 million in the bank, not including the 6 million R&D tax incentive, which came in in April. I'm very excited about the growth ahead. And so I'm gonna stop here and I'm going to go to the Q&A and answer some of the questions that have come through during the session. So let me just get that up. Okay. The first one was there was strong growth for the quarter, but was this only because of the acquired revenues through in vivo? It was both, it was strong, underlying growth in Microbe's existing testing business, plus realizing the first full quarter of in vivo revenues. To be clear, there was strong growth for Microbe's underlying business with that critical component that I called out being the underlying growth of Microbius Gastrointestinal Disorders tests MetaXplore in Australia with 1100 tests solved during the quarter, which represented 28% sales growth quarter on quarter and over 1100% growth year on year. Next question here is what more can you tell us about the launch and traction of MetaPanel? Sounds positive, but there are no sales numbers that have been shared. There's also another question that's related to this, which is understanding its early days of metapanel launch, but can you see any trends or order patterns at this point in terms of patient profile, level of concentration of ordering physicians? So to have referrals and sales across all states of Australia after only a few weeks is a good position. We hope to share more specific numbers in the future, aligned to also making sure we have Sonic's comfort with sharing that information publicly. But as stated at launch, we plan to execute a considered end stage rollout process, which is exactly what we're doing. So overall good progress, expecting continued growth and momentum. We then expect will translate into impactful volumes and revenues in FY25. In terms of the trends and order patterns, it's probably a little premature to say we've certainly got anecdotal bits of information around where we're seeing ordering and for what patient profiles. But we want to really put some rigor around those numbers and move it from anecdotes and into meaningful insights for shareholders, but I think it's safe to say that that overarching value proposition is resonating come across clear in the education events that we've been running nationally, which is that the ability to comprehensively be able to measure all of the potential gastrointestinal pathogens using the metapanic technology is highly valuable. And it's valuable across a range of patient settings. And we're particularly focused on that chronic diarrhea setting and really going deep on that and engaging with KOLs aligned to evidence generation across that, inflammatory bowel disease flares, and a range of other settings. We'll update more detail on that in the very near term. The next question I have here is, you said 2.2 million in sales for InVivo is aligned to your expectations. That would annualize out to around 8.8 million, which was aligned to the number represented in the acquisition. But what's the expectation for that number to grow? you're spot on. The plan was threefold. First, to bed down the acquisition and the acquired revenues. And this has been completed and delivering that baseline revenue aligned to our expectations. So that's what we're seeing there in those numbers. The second is to bolster their sales resources to unlock what we saw as the latent growth potential within their existing business. And so recruitment there is complete, sales hires have been made and due to start shortly. And then the final piece which you're alluding to is unlock the micro growth synergies, which was at the centerpiece of our investment thesis in the acquisition. And planning is advanced there to launch Microbus MetaExplore product into the UK to drive growth in their gastrointestinal testing, which as I said before, represents more than 80% of their testing sales volume. And we plan for that to occur in FY25. And I expect to share more details on the specificity of the timing there on that very soon. The next question there is, what is the state of expenditure and burn? Operating cash burn was approximately half of the prior quarter. So down from 6.6 million in Q2 to 3.4 million in Q3. The company's R&D expenses are lumpy. There was also some in vivo acquisition costs that came out in the prior quarters. But there are some expenses that are going to come out in their current quarter, which will be offset by that receipt of our 6 million FY23 R&D tax incentive claim. But the overarching trend of expenses and burn is down. And I'll say we are committed to building a sustainable, profitable business and most certainly moving towards that. The final question here is one which I'll hand to Trent on. which is what is the plan for the inflammatory bowel disease program phase two trial for MAT 315, timing, cost, funding, how are you looking at this? Trent, I'll hand over to you on that.

Thanks, Luke. We plan to release more details on this in the coming months. To be clear, our strategy remains unchanged, as I mentioned in the presentation, and that is to do that initial preclinical and clinical de-risking and then partner with strategically aligned folks for later development and not to plan to be a late-stage drug developer or to have to capitalise large late-stage pivotal trials, for example. Our goal, though, is to ensure a return for our shareholders while also executing a strategy which is non-dilutive to our shareholders. So I think that's a really important point about how we think about this. I think the other thing is, rest assured, this is a top priority for us and we look forward to sharing the plan that we've been working on with you all in the coming months.

Thank you, Trent. So I'm going to close out there with our world-class team and technology. We have made significant progress this quarter and unlocked strong growth. I'm really excited about the milestones and value which will be created for shareholders over the quarters ahead. I want to thank everyone for your ongoing support and for tuning in for the update. Thank you all.