Predictive Oncology Inc.

Good day, ladies and gentlemen, and thank you for standing by. Welcome to the Predictive Oncology Third Quarter 2022 Earnings Conference Call. At this time, all participants are in the listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 1 1 on your telephone keypad. At this time, I would like to turn the conference over to Ms. Teresa Ferguson. Ma'am, please begin.

Thank you. Thank you and welcome everyone. Thank you for dialing in. We're pleased to be here today, especially to introduce you to our new chief executive officer, Raymond Benari. He is going to share about his background in building, launching, and leading biotech companies and how those insights will shape his vision for predictive oncology. Then we will hear from Dr. Pamela Bush. She'll give us an update on sales and marketing and then Bob Myers will share our chief financial officer will share about. Our financials so we. appreciate you being here and real quickly, I will read about our forward looking statement note that this call will be recorded and includes forward looking statements within the meaning of the private private securities litigation reform act of 1995. These forward-looking statements are based on management's current expectations, estimates, and projections about our industry, our management's beliefs, and certain assumptions made by our management. Words such as expects, plans, intends, anticipates, believes, estimates, seeks, variations of such words and similar expressions are intended to identify such forward-looking statements. The forward-looking statements are not guarantees of future performance and are subject to risks and uncertainties. including the risks described in public filings with the U.S. Securities and Exchange Commission. The company's actual results may differ materially from the anticipated results reflected in these forward-looking statements. Thank you. I now welcome Raymond Benary.

Good afternoon, everyone, ladies and gentlemen, everyone on the phone, those who have subscribed and those who have subscribed. asked to ask or signed up to ask questions uh it's really a pleasure to to be here today i think it's important for you to know how i came came to the company and what i see and where i think we can go with the company so initially about a year ago i should say that i was asked to advise the board and advise the company I was asked by one of the board members to come in and take a look at what was happening in the company. And in that process, to identify opportunities in the marketplace that might otherwise be unrealized or to maximize the value of the assets that the company had and how we might aggregate all of that in a way that would move us forward. And in the process of those conversations, I was actually asked to join the board. So I spent about a year digging deeply into all of the technologies of the company and the markets for which they have application. And ultimately, in the end, after the retirement or the announcement of Mel's retirement, I was asked to step in as CEO. So the first thing that you should know is this was not a knee-jerk reaction to just fill a seat. with a board member. It wasn't at all. It was that I was brought in really to provide some strategic direction for the company before I became a board member. And then after I became a board member, I was asked to step in as CEO. And I will tell you that I do it gladly. We all know that it's a difficult time and it's challenging. And I've accepted the challenge and I'm committing myself to it. I'm committing myself to it because I believe in it. I believe in the company. I believe in the people. I believe in the market opportunity. I believe in the growth of the company. What's most important right now, I think, is that we focus. We focus on the market opportunities and we focus on how to leverage the assets of the company. And so I will tell you one of the first things that I did was to do a forensic analysis of what we have. And what I found was... fascinating really is that I think the first thing is investors should understand that the money that's been invested in this company has been well spent because of the value that's been created in terms of the platforms, in terms of the technologies, in terms of the people who've been brought to the table. It's been a long process, but it's been a very valuable process. While that hasn't been recognized in market adoption yet, it certainly has been realized in terms of positioning the company to be adopted in the marketplace. None of what we have, none of what Pamela is going to speak to in a few minutes would be possible without the investment that's been made into the core technologies of the company and the quality of the people who will be doing this and have done this, by the way. This is not experimental anymore. This is not R&D. We're launching commercial technologies. And that, by the way, is my background. Commercializing, identifying, commercializing, and launching novel technologies in the marketplace, primarily in biotechnology and specifically in oncology. This, for many years, has been a personal commitment for me. My mother, my father, my brother, my grandfather have all died of cancer. So I literally... pivoted many years ago to find some way to contribute to this process of discovery for diagnostics, therapeutics, medical devices, whatever I could do. It was a personal commitment to do that. And it's also why I agreed to take this position is because I want to move that forward because there are a lot of people like me whose families and probably many of the families of the people on this call right now have dealt with this or are dealing with it or will deal with it. So I take that as a personal commitment. a personal commitment on my part to do what I can to make a difference. So in the process of evaluating the assets of the company, what I realized was that the technologies that we have have been, frankly, underutilized. And underutilized because they've been underappreciated. Maybe underappreciated because we didn't recognize it, but certainly underappreciated because the market doesn't really understand what we have. one of the things that we have we talked a lot about the artificial intelligence um all of you i'm sure many of you on the phone right now recognize if you've been following us for quite a while so you know what pedal technology is and core technology is and what what the the capacity of that intellectual property is and the and the artificial intelligence capacity is but the only reason that it's relevant is because we we own and control probably the largest privately held tumor sample biorepository in the world. Every scintilla of biomedical research that's done is done because they have access to human tissue samples. And specifically, our database is tumor specific, meaning tumor indication, tumor type. So when I joined, actually this started when I was on the board, but I began to ask questions like, what is the value of the biobank and how is that relevant to the future direction of the company? And the simple answer to the value of the biobank, it can be viewed in two different ways. One is what's the value to our customers and what's the value to the company with respect to valuation. I really can't speak to valuation. I'll let Bob talk about that or at least in how it's how it's handled on our balance sheet and our financials. But I will tell you that the value of the biobank alone is in excess of $400 million. I'm not at all suggesting that tomorrow the company's going to be worth $400 million. What I'm saying is that it has been underappreciated, and we have to understand that that's an asset that we have to leverage and utilize in order to drive us into the marketplace in a way That has not been possible in the past, not because we didn't have it, but because we didn't use it. And I'll be happy at the end on Q&A to answer any of these questions. So the combination of our pedal technology, which is the artificial intelligence, paired with access to the tissue samples, the tumor samples, I should say, that we have in our biorepository is what makes us unique in the marketplace. And that is what is going to differentiate us in the marketplace. And that is what the companies with whom we are speaking are interested in. And I will tell you that we actually have, again, on us, on me, I mean, I might be here now, but I'm not going to walk away from what has or has not happened in the past. I accepted this role to change things and make a difference. So I'm assuming full responsibility or what has or has not happened in the past. But I will leverage that to make sure that we can move forward and grow the company. So the integration of the pedal technology with the biobank is really the differentiator for us and sets us up to penetrate those companies who are already customers of ours through acquisition that include three or four, maybe five, I'll ask Pamela or Bob to clarify that for me because I'm into this now for a full 10 days. So of the top 10 pharmaceutical companies, biopharmaceutical companies in the world. So we already have access to that customer base, the very customer base we want. Have we penetrated it? No, but we have access to it through our acquisitions. And that is going to be a major focus. And Pamela, I'm sure, will address that. So I should also say, just for context, we do have a GMP facility, Good Manufacturing Practices facility, for formulations. And that is part now of the service line of the company. So I'm sure you all know that we are consolidating. Or maybe you're not. Maybe I'll be saying this for the first time. You may not have heard this before. So we're not rebranding the company. We're refreshing the brand of the company. And we're doing that by integrating all of what were segments in the business into service line within the business. So what we provide in the context of our value in the marketplace and our differentiation in the marketplace is service along the continuum of drug discovery to drug development. That is a very long process, as you all know. Biopharma, it's a business that takes a long time, primarily because it's highly regulated. But we now have services and domain expertise along the entire continuum. On the front end, we have, which is our most distinctive and proprietary novel platform, is driving drug discovery to find those molecules that can go into drug development. And I'll leave this to the panel to explain this deeply. But formulation and 3D modeling of large cells fall along that continuum. They're just applied differently. So as we talk about this, I want you to understand that while the segments may disappear, the domain expertise is now consolidated into the CLIA laboratory, Predictive On-Qualities CLIA laboratory. And we're able to do that because we do have a GMP facility, so we can move from discovery to testing to preclinical testing and to clinical testing within the GMP environment. And we are making inroads. At the moment, we're making inroads to do exactly that. We have the capacity to do that. I simply want, by introducing myself to you, to have a sense of who I am, what my vision is, what my commitment is, but also to reinforce the fact that, because sometimes this gets lost, and I know, so I'm an investor myself, and I have been for many years. The people are important. The quality of the people are important. The integrity, the commitment, the ability of the people. that are involved in this are extremely important. And I have absolute confidence in the people in this company. I will also say that, although I cannot mention them right now, part of this strategy, part of my modus operandi is to surround this company at the board level and the scientific advisory board level with key thought leaders in the industry. Some have already been announced. Some will soon be announced. But I view these people as credible C-level executives in the industry who can move us in the direction that we need to go, not by parroting what we say, but by telling us where we need to go. You know, to use the hockey metaphor, you skate to where the puck is going to be. And so part of the strategy here is external to the company to provide surrogate leadership through our advisors to open doors in the industry that we haven't really done before, quite frankly. And for better or worse, that's going to fall to Pamela. So this is a perfect transition to Pamela. And Pamela, as you may or may not know, Pamela is our Senior Vice President of Strategic Sales and Business Development for the company. But I want you to know when I'm talking about the quality of the people in this company. So for those of you who do know, please forgive me for being redundant, but for those of you who don't, Pamela is a PhD MBA who completely understands the business of science. That's different than science. The business of science is very different. Before she came to Predictable Oncology, she was lead negotiator for term sheets and contracts at Eli Lilly Company. And she was the company liaison between the science and the business development functions of the company to in-license and out-license strategic assets. But she began at Lilly in finance and oncology pharmacogenomics benchmarking process. So she understands not only the business of science, but the business of the business of science. She actually did the modeling for what it is that needs to be identified, what it is to move forward with and how to move forward with it. But before she became director of corporate business development at Lilly, she was manager for R&D finance. And she led the planning and the forecasting and controllership responsibilities for $1.5 billion across multiple functional areas within Lilly. So when you listen to Pamela, you're listening to someone who was in the very industry that we're trying to get into. She understands it from the inside out. And while there may be growing pains and we may need to adjust to market opportunities and shifts in the marketplace, and changes in the way that biopharmacy companies do business, Pamela is the one who understands that as well or better than most. So with that really heavy obligation, Pamela, I'd ask you to join the call and please put some things in perspective for us all.