Altamira Therapeutics Ltd

Good day and welcome to the Altamira Therapeutics full year 2024 financial results and business update call. Today's conference is being recorded. I would now like to hand the conference over to your first speaker. Please go ahead.

Good morning and welcome to the Altamira Therapeutics full year 2024 financial results and business update call. On today's call are Thomas Mayer, Altamira's founder, Chairman and Chief Executive Officer, and Covadonga Panera, Altamira's Chief Operating Officer. Earlier today, Altamira issued a news release with the full year 2024 financial results, as well as a business update. The release is available on the company's website at www.altamiratherapeutics.com and has been filed with the SEC. During today's call, the company will be making forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These include statements that address future operating financial or business performance or strategies or expectations. Full looking statements are based on management's current expectations and beliefs and involve significant risks and uncertainties that could cause actual results, developments, and business decisions to differ materially from those contemplated by these statements. These risks and uncertainties include but are not limited to the timing and conduct of our clinical trials, the clinical utility of our product candidates, the timing or likelihood of regulatory filings and approvals, our intellectual property position, and our financial position, as well as those described in the risk factors section in our annual report on Form 20F and future filings with the Securities and Exchange Commission. In addition, any forward-looking statements represent the company's views only as of today and should not be relied upon as representing its views as of any subsequent date. While it may elect to update these forward-looking statements at some point in the future, It specifically disclaims any obligation to do so even if it's viewed to change. With that, I will now hand the call over to Ultimate Therapeutics CEO, Thomas Meyer.

Thank you, operator. Hello, everyone, and thank you for joining our full year 2024 financial results and business update call. I will kick off the call by providing an overview of recent corporate developments and an update of our corporate strategy. Our chief operating officer, Covadonga Panera, will then discuss the progress with our RNA delivery business. Finally, I will discuss our 2024 financials and outlook for 2025. Overall, 2024 brought progress in many regards for Altamira. With our RNA delivery programs, we continued to gain momentum as we could win two new partners for our X4 platform, managed to further improve our manufacturing process, and were able to demonstrate that the platform works also with circular RNA. The latter highlighted the platform's great versatility across different RNA modalities and could help to open interesting new business opportunities for Altamira. Unfortunately, there was also a major setback in 2024 as NASDAQ decided to delist our common shares due to an issue with their minimum bid price rules. Also, we appealed against their decision and proposed taking customary measures to regain compliance. Our arguments fell on deaf ears, and the NASDAQ hearing panel upheld the listing decisions. Therefore, trading in our common shares was transferred to OTCQB and the ticker symbol changed from CITO to CITO-F. The transfer and the changes in valuation and trading volume related to this triggered our board to perform an intense review of the company's funding needs and options. We concluded that raising funding for the expected growth of the RNA delivery business from public markets was not a viable option. Rather, the board decided to prepare the involvement of private equity investors at the level of the company's Swiss subsidiary Altamira Therapeutics AG, short ATAG, which operates Altamira's RNA delivery business. Altamira aims to spin off a majority of ATAG's share capital and has initiated the process for the legal and organizational carve-out of this entity. With the partial spin-off, we anticipate the publicly listed Altamira Therapeutics Limited becoming even more of a holding company, owning minority stakes in ATAG and Altamira Medica the manufacturer of the Bencho nasal spray, and participating in their expected growth and value appreciation. In addition, the listed parent company stands to benefit from the partnering of the other legacy assets, such as AM125, our nasal spray for vertigo treatment, or AM111, a treatment for acute hearing loss. Following this introduction and update, I'm handing the call over to Kova Donga Panjira, our Chief Operating Officer, who will provide you with a more detailed update on our RNA delivery business. Kova?

Thanks, Thomas, and good morning, everyone. RNA therapeutics continues to be an exciting space with more drugs and modalities, reaching late-stage clinical programs and market approval. Research and development activities in Altamira Therapeutics peptide-based X4 nanoparticle platforms continues to progress. The key focus during the first half of the year was the nanoparticle formulation and process development around our platform. Oligo4 for siRNA, Semaphore for mRNA, and Cycle4, the newest addition to our technology for circular RNA. In addition, significant effort has been allocated into evaluation and development of nanoparticles for delivery of specific RNA payloads for our partners. Important progress has been achieved with the development and refinement of analytical methods, reproducibility of manufacturing, and stability of the nanoparticles. Our efforts have led to nanoparticles with greater stability that can be shipped and stored while maintaining their physical chemical properties. In addition, Tolerability studies have shown that these particles have an excellent tolerability profile after single or repeated intravenous administration. Circling back to the newest member of the X4 family, we are excited over the confirmation that our technology is amenable for use with circular RNA. In vitro experiments demonstrated successful cell transfection leading to higher protein expression compared with linear mRNA. Based on these results, the company filed a provisional patent application with the United States Patent Office for Cyclo4. Circular RNA has recently attracted substantial interest in drug development thanks to enhanced protein expression and greater stability compared to linear mRNA. Cyclo4 could open up new collaboration opportunities with companies focused on this particular RNA modality or seeking to treat chronic diseases. Altamira is pursuing a pick and shovel strategy with the RNA delivery business. This strategy is based on the licensing of our platform technology to partners in the biotech and pharma industry for use with their own RNA payload. To the already established collaborations with Hackett Therapeutics for regeneration of damaged heart tissue following myocardial infarction and Universal's group for mRNA vaccines, we have added a new collaboration agreement this time with a company in the radiopharmaceutical sector to evaluate the use of Altamira's pre-HRA RNA delivery platform for radiopharmaceutical targeting. Radiopharmaceutical therapy uses very small amounts of radioactive compounds called radiopharmaceuticals or radioligands to diagnose and treat various diseases, in particular cancer. Once injected into the patient, the radiopharmaceutical finds its way to the tumor through the bloodstream and binds to a tumor-specific receptor. The global radiopharmaceutical market reached $8.4 billion in size in 2024 and is expected to grow to $17.1 billion in 2033. Under the terms of the agreement, Altamira and its project collaboration partner intend to test in vitro and in vivo the use of nanoparticles with an undisclosed RNA payload in conjunction with one of the partner's proprietary radiopharmaceuticals. Upon successful conclusion of the experiment, the partner will, under certain conditions, have the option to negotiate with Altamira a license and supply agreement to develop commercialized the RNA particles for use in cancer treatment. Focusing on our proprietary developmental programs, AM401 and AM411, Altamira filed, during the first half of 2024, several patent applications with the US Patent and Trademark Office to protect candidates for both programs. For AM401, we have now shown that their candidate-based and oligophore platform is well tolerated after intravenous administration, even at high doses. The company aims to advance at least one of the flagship programs to an investigational new drug IND filing with the Food and Drug Administration in 2026, and to out-license them either following the IND or after phase one clinical trial at the latest. In August 2024, part of the company's expanding research and developmental team moved to the Switzerland Innovation Park in Auschwitz, near Basel. At the new location, the company has access to modern and well-equipped lab facilities to support its growing activities. I will now turn the call back to Thomas.

Thanks, Koba. I will now discuss briefly our two main legacy assets. the Benchio drug-free nasal spray for allergy, and our AM125 beta-histine nasal spray for vertigo and other disorders of the central nervous system. Our associate Altamira Medica, or short Medica, agreed last year with two of its international distributors on the expansion of the exclusive distribution territories with Nuance Pharma for Southeast Asia and with PharmaNautic for Sweden and Denmark. The two territory extensions are a strong mutual vote of confidence by the partners. This year, Medica expects marketing approval for BenQ in mainland China, providing for a major commercial opportunity in cooperation with Nuance Pharma. For the US, the world's largest market for over-the-counter products for allergic rhinitis relief and treatment Medica recently received good news from the US Patent and Trademark Office. The US PTO finally allowed a patent covering Venture's composition, providing for market protection up to 2040. This has been the last important missing piece in discussions with potential US licensees or distributors, as Venture has already been cleared by the FDA. Discussions with potential partners are ongoing. Meanwhile in Europe, Medic has been working hard on setting up an alternate production site with a contract manufacturer in Germany and on transitioning Bentrio from a Class 1 to a Class 2A medical device under the new EU medical device regulation MDR. The completion of these two projects will open up significant commercial opportunities in Europe and allow for ramping up supplies to partners worldwide. As for our AM125 nasal spray, we have partnering discussions ongoing with several parties. The same goes for AM111, a self-penetrating peptide for the treatment of acute hearing loss, which has orphan drug designation and is in phase three clinical development. Now turning to our financials. Before reviewing our financial results for 2024, I would like to note that the full year financial statements are presented for the first time in US dollars rather than in Swiss francs. Further, I need to remind everyone that due to the partial divestiture of Medica, the venture activities are reported as discontinued operations. Continuing operations thus comprise the RNA delivery development programs as well as those related to AM Overall, financial results for 2024 came in pretty much within expectations. Total operating loss from continuing operations increased from $6.6 million in 2023 to $6.9 million in 2024. Research and development expenses were $3.7 million in 2024 versus $3.4 million in 2023. General and administrative expenses decreased from $3.5 million in 2023 to $3.2 million in 2024. Net finance expense decreased from 1.5 million in 2023 to 0.8 million US dollars in 2024, primarily as the company incurred no more interest expenses. They were in 2023, 1.1 million dollars. The company's share of the loss of its 49% associate Altamira Medica amounted to 0.8 million dollars in 2024, versus $44,000 in 2023. However, the latter related only to the period from the sale of 51% of Medica's share capital in November 2023 to year end. The company's net loss for 2024 was $8.5 million compared with $4.3 million in the previous year. However, it must be noted that in 2023, This continued operations contributed a profit of $3.8 million, reflecting an accounting gain of $5.8 million on the partial sale of Medica. Overall, the balance sheet as of December 31st, 2024 does not show major changes compared to December 31, 2023. Shareholder's equity amounted to $6.6 million compared with $7.7 million at year end 2023. There was no financial debt outstanding at either time point. Cash used in operations decreased from $12.8 million in 2023 to $6.1 million in 2024. Investing activities consumed in cash in 2024, whereas they had provided $1.6 million in 2023, reflecting mainly the Medica transaction. Financing activities provided $6.5 million of cash inflow in 2024, compared against $11.8 million in 2023. Cash and cash equivalents at year end 2024 rose to $1 million from $0.7 million at December 31st, 2023. Upon completion of the planned partial spinoff of ATAG, our subsidiary for RNA delivery, we expect operating expenses to decrease significantly. The parent company will become, as mentioned earlier, more of a classic holding company managing and monetizing its participations and assets. We expect to fund our operations from our cash position, proceeds from the sale of ATAG shares to private equity investors, the partnering or divestiture of legacy assets, as well as from the provision of services for affiliates. Resonance from meetings with potential private equity investors has been very encouraging. Altamira intends to update its financial guidance as and when material new information will become available, notably on the planned partial spinoff of ATAG. With this, let me conclude with some comments and perspectives. At the beginning of today's presentation, I mentioned the growing momentum in our RNA delivery business. It is great to see the significant progress that we have been making since the beginning of 2024, both with our development projects as well as with our business development activities. For this momentum to continue or even accelerate further, it will be essential to have the business funded appropriately. The delisting from NASDAQ was undoubtedly a painful experience for all of us and threw a wrench into the works especially regarding our ability to raise meaningful capital on the public markets. With the planned partial spinoff of our RNA delivery activities and the involvement of private equity investors, we believe to have found a reasonable and beneficial alternative approach. It will help to position Altamira well for building the business on the strengths of X4 and addressing the strong potential for RNA therapeutics. Also, shareholders of the listed parent company will control less of the RNA delivery business. As a result of the spin-off, that business itself will be better capitalized and in a stronger position to grow. We certainly still have some work to do to implement this relatively far-reaching restructuring of the company. We look forward to advancing this important project as well as our other projects towards the next milestones and to updating you with further reports about our progress. I thank everyone for attending this morning's call and wish you a terrific day ahead. I would now like to turn the call back to the operator.

Thank you for your participation in today's conference. This does conclude the program and you may now disconnect. Thank you.