AcuCort AB

Hello and a warm welcome to Investor Update today with AccuCort's second quarter. A report that CEO Jonas Jönmark will present to us on the link. As always when we send live, you can interact with the CEO by asking questions in the chat field. We will handle the questions after the presentation and I see that we have received Already now we have received some questions and we have some questions that we have received on e-mail as well. So it can be good to load in those questions. And with that said, it is high time to greet Jonas. Welcome. Hello Jonas, how are you?

I'm good. Nice to be here and nice to be able to talk about Akko Kort.

Yes, a hectic quarter again, I would like to say. So please, the stage is yours. Take us through the presentation.

Thank you very much and welcome everyone to our quarter presentation for the second quarter this year. I thought we would talk about the second quarter, but I also thought we would take and summarize how the year has been so far. And I actually thought it was a chance to tell a little bit about what we have going on and how we work in the company. So we threw ourselves straight into the second quarter. If we look at the second quarter, we have had a turnover of approximately 162,000 kronor. And the result of this tax was up to minus 7.5 million, to compare with minus 4 million almost at the same time last year. And then you can always ask yourself, okay, what are the extra costs? It is that with the good financing we did at the beginning of the year, så har vi kunnat driva upp tempot i bolaget bra och pengarna kunnat gå till, vi har kunnat investera mer i marknadsföring av företaget men även i vår affärsutveckling för framtiden så det är jag väldigt glad för. Resultatet uppgick per aktie till tre öre eller minus tre öre per aktie och vi har drygt 32 miljoner i kassan och det kommer ta oss långt in i tiden. Tittar vi på På året så här långt så har vi haft en omsättning på 162 000 kronor. Det är framförallt orden som har gått till Danmark. Men vi har även tagit en order som inte syns i det första halvåret som går till de övriga nordiska länderna. Här uppgick resultatet till minus 14 miljoner att jämföra med 7,5 miljoner föregående period. And that is because we have really been able, with the strong financing, to increase the pace in the company, which feels very good. The result on the share, minus six hours compared to minus nine hours in the previous period. And if we look at the essential events that have happened during the second quarter, as I mentioned before, we have received a new order. från vår kommersiella partner och expanderar därmed till Danmark. Jag tycker detta är en väldigt stark kvalitetsstämpel. Produkterna är ju mitt under lanseringsfas i Sverige, Norge och Finland. Att vår partner nu väljer att öppna upp Danmark också visar på hur bra det har gått i de andra. Så det tycker jag är väldigt positivt. And with that said, strong development on the Nordic market. We have received a new order from our partner to be able to fill in the layers. We have also registered Secmellit, our product, as a brand in Canada. And we have made a decision with a company called Lunatus for Mellanöstern. och en avsiktsförklaring med ett företag som heter Glenmark Pharmaceutical för länder i Europa. Jag ska faktiskt komma tillbaka till detta, vad detta betyder och var i processen vi skriver Letter of Intent och varför. En av våra största ägare, Life Science Investment Fund, investerar ytterligare en miljon kronor genom nyttning av sina täckningsoptioner. Och vi... Just this summer, we made the exception of the new coverage options that provided the company with over SEK 6 million. And here I am very grateful for the support that our shareholders have shown. I know that the coverage rate for these options was very close to the market rate it was at the time, but that people still went in and chose to cover has strengthened us very well. So I am very grateful for that. Släpper vi första kvartalet och första halvåret och börjar titta på vår produkt så vill jag återigen lyfta fördelarna med vår produkt för de som är nya här. What we have is a quick and smooth treatment for acute allergic reactions. It's a mouth film you put on your tongue that melts in about 10-15 seconds. If we look at the potential, it's somewhere between 25 and 30 million people that are diagnosed in Europe and the USA annually with this. So it's a big market and it's growing. If we look at the market size, it is somewhere around 3 billion US dollars on a yearly basis. So that's strong. There is a great need for easily accessible and effective treatment with severe or acute reactions. This is evident especially now in the launch in the Nordic countries. We have the doctors with us on our side. What they tell us now is that now the patients must come to us, then we write out this product. And we work very much now together with our business partners just to consciously do this with the patients so that they come to their doctors and get the right recipe to pick up. One of the important reasons here for why doctors see The big potential in our product is that the accessible treatment today is difficult for the patient to administer and places it quite properly for the patient when it is an acute event. We have also done studies where we see that over 70% of the patients would prefer a mouthwash before the available tablet treatment. And these are incredibly strong figures. The remaining 30%, I was very curious about, it turns out that the last 30% were the patients who very rarely ever got an allergic reaction. So the more often you get an allergic reaction, the more difficult the allergic reaction you get, the more you choose a mouthwash as our product. If we turn it around and look at the medical corps, nine out of ten doctors say they are willing to prescribe our product to up to half of their allergy patients. I will show it here. It is half of this pyramid, which is a lot. This picture illustrates how the allergy market looks like and how our product is positioned on the market. In the bottom of the pyramid, here we find mild to moderate allergies. That's where you find me. Pollen allergies, grass and birch, which makes me go to the pharmacy. I buy my antihistamine over risk at the pharmacy. Then there are those where antihistamine is not enough, who need an acute treatment at the time. This is where we find our allergy patients. It's a slightly more difficult allergy, in the middle of this pyramid. And it's the one that has as much potential as over 3 billion US dollars per year. The top of the pyramid is this 1% of the entire allergy market. And it's those who need adrenaline to treat their anaphylactic shock. And it's not directly our primary target group, but our target group is the big piece here in the middle of the pyramid. I would like to tell you a little about what we are doing and how we work. Our business model is to commercialize this product via a global network of distributors and license holders. Accocort itself, we are not going to build a large, expensive, self-selling organization in the world, but we are going through others. distributors and license holders, which means that we have a very capital-efficient model in this. The springboard and proof of concept here is the successful launch in the Nordic countries, and that is what actors on the market have seen how it has gone, which has also meant that we have been able to open some new doors and we have a much better negotiation position now when it comes to partnership agreements and so on. What we are looking at is distributor agreements, where the distributor buys the product from us and launches it on the market itself. The other is, which I prefer, license agreements with an upfront payment for a license to either manufacture it yourself or order it ourselves from our manufacturer and pay in miles. So these are the two tools we work with on the market. Then we have a very thorough selection process. I will soon come to how it looks. Because this is about finding the right partner for the right market. And if you sign a contract with a partner that then turns out to be wrong, then it is very difficult to reverse the tide and take it again. That is why we are extremely careful when we are looking for our partners. And what we are looking at are things like which investment willpower do you have? What market share do you have in the segments that are important to us? How many resources do you have to put behind a launch? And what type of commitment are you prepared to make, both when it comes to minimum order volumes, but also investment levels in the market. These are some of the most important pieces we look at. An partner should be the strategic extension of Accocort out in the market. I was going to tell you a little about them. We have... signerat nu nyligen två stycken letter of intent. Jag tänkte berätta hur de här förhandlingsprocesserna ser ut. Nu är detta ganska schematiskt. Vissa steg går fortare än andra, och vissa bolag, där kan man kanske hoppa över något steg och så vidare. Men vanligtvis är det att man har någon form av introduktionsmöte i början, där man klämmer och känner på varandra med officiella data och information och sådana grejer. Verkar det So that you have a good password there, then you go on and write a security agreement, which means that you can then start to share secret information and business activities between each other. And this reminds us of what we call a term sheet, and it is actually a couple of pages that are laid to the ground, what will then become a a contract, a license contract or a distribution contract. It's something like minimum order quantities, it's prices, delivery times, responsibility distribution and so on. When you're well aligned with that, then you write a letter of intent. And then you've laid the foundation. You're aligned with the basic parts. This letter of intent also, I think it's a benefit to write down, because it also sets the center tidslinan för hur snabbt man kan gå fram i en förhandling. När ska saker och ting vara klart? Kan vi starta grejer parallellt? Vem bär de kostnaderna och så vidare? Jag är en stor vän av att kunna starta grejer parallellt så att man inte gör saker efter varannat. Utan när man har kommit så långt och man har förtroende för varandra så kan man börja med processer med myndigheter och sådana grejer. Man kan börja med prelansering och man kan ta kontakt med opinionsledare. Det styr This letter of intent, that's why it's so important. When you have written a letter of intent, then this deep due diligence begins. Then we go in and dive deep into place with our commercial partners. They do the same thing with us, so that you put all the cards on the table and see that there are no dogs buried and so on. This is important, because this is where things can come up that you didn't see before. Here we also go out and talk to the license holder or the distributor's existing commercial partners, take references and so on. It's almost like an employment process. Then you start negotiating the distribution agreement. If you have done a good process here before, it goes pretty fast. Can it be things that have appeared during the due diligence process? Then you take a step forward in the agreement to see if you can find workarounds or formulations in the agreement that give risk minimization for APOCORT in the agreement. And then it is the signing of the agreement that is needed. And when the agreement is signed, then I would like many of the processes to have already started. such as registration processes, freelancing activities and so on. So this is what it looks like in detail. You can put in more steps and so on, but here is the general picture. The tendency is that if it is a smaller company you are talking to, it often goes faster. When we talk to big dragons, then there is a lot of bureaucracy on their side. Then we always take longer time, but I think everyone understands that. But there it is, this letter of intent. som styr tidstakten, så att säga. Därför är det viktigt. Tittar vi framåt? Ja, vi ser fram emot ytterligare handelsavtal, ledande europeiska länder och även, vi har en del intressanta länder även utanför Europa och USA. Vi jobbar ju för ett marknadsgodkännande i USA och de som har läst mitt vd-ord har ju sett där att vi har fått en återkoppling från FDA, äntligen. De missade ju sin egen deadline med ett par månader och vi har ju legat på dem under vägen här nu och de har ju sagt själva att de har vissa interna organisatoriska utmaningar som ligger bakom detta. I saw earlier this year that 600 people were mentioned at the FDA in the US. We work very closely with our American regulatory partners here and are constantly trying to push the FDA and help them keep their deadlines. So we're not sitting and waiting for something to happen, but it's a fun but determined push from us here. The connection we got now from FDA was a number of very specific questions for our product. Before, the questions were much broader. Nu är vi nere på väldigt specifika saker och vi jobbar nu med att svara på dessa. Vi kommer ju lämna in våra svar betydligt tidigare än deadline. Vi är små, snabbrörliga, vi har god kontroll över våra vetenskapliga studier, så det är inget problem från vår sida. Parallellt med det så vill jag få till ett möte med FDA för att göra en tidsplan When can we expect answers? And when can we get a signal that it's time to submit our application? So that's what's going on around FDA. More orders, of course, from Unimedic we look forward to. Also orders from the upcoming commercial partners that you have seen Letter of Intent on. Continued expansion in the USA. Jag ser verkligen fram emot att kunna lämna in vår ansökan i USA för det kommer att stärka vår förhandlingsposition och det kommer att göra oss väldigt mycket mer intressanta för de större läkemedelsbolagen i USA. Man är en spelare att räkna med när man har lämnat in sin ansökan. Vi har även avslutat en stor studie på 50 patienter på vår produkt. Där ligger man nu i manuskrivande. Manuskrivande tar alltid tid. Det bollas fram tillbaka. Man bollar också med de vetenskapliga tidskrifterna. Man får alltid massa edits att göra. Men jag ser fram emot att vi ska kunna lämna in det till en vetenskaplig tidskrift av betydelse här under hösten. I mentioned expansion. We are looking at emigrated countries outside of Europe and the USA. And there are a lot of interesting countries here, such as South Korea, Australia, South Africa, countries in South America, and so on. And I usually get the question, do you have other products on the go? So yes, we have thoughts, but Fokus är nu på framgången för den här produkten Säck Mellit. Det är vår högsta prioritet, för det kommer att lägga grunden till företagets framtid. Om vi skulle summera Akokort som ett investment case, så skulle jag säga så här, fem stora punkter, varför man ska vara med i det här caset. Det är en innovativ produkt. Det är en tydlig klinisk nytta som både bekräftas av läkarna och av patienterna i de kliniska studierna. Det är en låg utvecklingsrisk. Produkten är färdigutvecklad. Produkten är dessutom godkänd av fyra europeiska läkemedelsmyndigheter. De har satt kvalitetsstämpeln på den här produkten i de fyra nordiska länderna. Försäljningen är startad. Vi har en kommersiell partner som driver lanseringen i de nordiska länderna. Produkten och företaget adresserar en väldigt stor marknad, över 3 miljarder US-dollar. Kan man få en marknadsandel där så är det mycket pengar för ett litet bolag i den här storleken. Det finns ett kompetent team och en erfaren styrrelse bakom bolaget I and my team have many years of experience in the pharmaceutical industry just by doing these international launches of products. We have an experienced and competent board that has been with us several times and made this journey from being a small hope company in life science to actually being a sales and pharmaceutical company as AppCourt is today. This is the core of the investment case. So, now that I've talked for a long time, I thought I'd pass the ball back to you.

Great, and thank you for that. We have received a lot of questions, both in the mail and during the time we've been talking. I'm going to try to structure it so that we start with the results and the balance sheet questions, and then we'll go into partners, and there will be a lot of FDA questions in the US. So we'll try to have some kind of red thread here. If we start with the question related to the cash register and as I interpret it, the higher the pace in your activity, which increases the costs from 3-4 million to 7 million. The first question is, is the cash enough? And of course it depends on what you are going to do. But should we say, for the plans that you still set up for the emission here, is the cash enough as you see it given that you are now gassing?

We are gassing now on all fronts. We have never been as well financed as we are now, which has also made it possible to shorten some timelines. and do things in parallel. This stock exchange will take us a long time. How long remains to be seen, because I want the company to be able to be opportunistic. It may be that we take on more markets than we have planned from the beginning, and then it will require capital, but it will pay off in the future.

Should you extrapolate the costs quarter by quarter here now, so that it will be on this level?

No, that will not do anything. Now we have accelerated and done things that We have wanted to do it for a long time, and now we have been able to do it in parallel with others, which has made it possible for us to buy time at some places.

Yes, exciting. And then we have a more general question here, if you say, what problems have you encountered? Or if I try to be a little more clear then, what bottle caps do you see? And if I were to say something, then I would say that a lot of what you have struggled with has been a little out of your control. Is that a claim that you can buy?

I can agree with that, and it's often the government agencies. When the agencies are with the FDA, it has cost us a lot of time, which I'm not at all satisfied with. And therefore, it is friendly with the determined push on the FDA in this regard.

Yes, and it is generally known that the FDA works in mysterious ways, so you have to let them have their way. Sales in Denmark, can you give us an assessment of the sales potential in the long run?

Denmark is an interesting country. It is one of our smaller Nordic countries. But it's a country that is very driven. They differ a little from the rest of the Nordic countries with free pricing and you can negotiate with pharmacy chains and so on. I would like to say again that our partner chose to go further in Denmark and launch there after a successful, rich launch in Sweden, Norway and Finland. I think it was a quality mark. on how things have gone overall in the launch.

If we move on, you have two vision declarations, letter of intent, that have been signed during the quarter. Lunatus and Glenmark Pharmaceuticals. Lunatus for Mellanöstern. Why did you choose Lunatus? You went through the process a bit, so I guess you could simply say, yes, they tick the boxes, but can you mention anything in particular?

Unique to Melunatus is that we have gone through a number of companies in that region. And you should always be careful when you do business in that region. It is a company that is very strong. They have very good presence within our segment on the market. This is at the same time a company that is well integrated. They have their own distribution, logistics, they also have their own pharmacies and they have a large sales core in the region. So that's why the choice landed on the NATO. And we have come so far with them.

And if you go to Glenmark Pharmaceuticals, then it is Germany and five other European countries. Why not give them the right to the whole of Europe?

Ja, det är en bra fråga. Det hade man lätt kunnat tycka. Men jag gillar att kunna spela ut affärspartners mot varandra. Och jag vill inte lägga alla ägg i en korg.

You went through the process and when you came to the plan explanation, you wanted to have a clear timeline. As I interpreted it, it gives a better insight. Do you dare to give us a hint when these two agreements go to commercial agreements?

Fingervisning, jag skulle säga att jag ser fram emot en väldigt givande höst.

Man får helt enkelt följa pressmeddelandena. Vi har ju gått igenom FDA och har en hel del frågor på FDA så det kan bli lite repetition av vad du har sagt. If we start with this, where you are now, what happens next? You will answer their specific questions and of course you will be the fastest here. But is your original, I should say original with this delay from FDA, is your original expectation still about the timeline?

My original expectation is still there. And that's also why we want to have a meeting with FDA, to be able to clarify a good timeline with them. We are largely clear on our side, so now it's about them getting answers to their specific questions.

I have a viewer who asks, what kind of specific questions are there? I don't know how much you can go into, but if I may add, I feel that if you get specific questions, then you have come through at least the first and second sorting, because now there is an obvious interest from the questioner.

There is a lot of interest from the questioners. In the dialogue you can see that this is a product that FDA can see on the market, but wants to have answers to certain questions. I do not want to precede the discussion with FDA, so we keep it there.

If you look at this delay from the FDA due to their internal situation, how do you feel that it has delayed your launch? If the delay was 90 days, is a launch delayed by 90 days or is it longer?

I see it as if all sales are delayed days for the market. I want to count sales days. Every day that is delayed is a missed sales day. That's why it's so important that we work together with FDA and push all the time.

I have a question when it comes to Europe, and it goes back to commercial agreements with your two latest actors. When do you assess that the product exists in Europe?

We are going to have an agreement with the company that we have written letters of intent with. In the discussions, I see that we should be able to start, either we or our business partners, by registering the products on the right market. Then it is up to the authorities to make a hurrying process and then we make sure that we have the products ready, which we will have for launch. What exactly the timing will be, it is a bit early to say right now.

If I go back and recapitulate what you said about Lunatus, which seems to have everything in its portfolio. When and if you have a contract, what prevents you from launching is their responsibility to the pharmaceutical authority's approval. When you have an agreement, it is so well processed that it is only to launch up to the fact that you get approval.

That's right. Then it takes a long time in different parts of the country. When it comes to the Middle East, it is about that the company that represents us in the Middle East is the one that will manage the registration process and things like that. That's one of the things that makes Lunatus stand out.

They've done this many times before. You mentioned other products. I have a question about Secmelit, a treatment for cancer patients. Is it approved for cancer patients? In that case, is it sold to hospitals and clinics?

That's a good question. This product is approved for cancer patients, something called CINB. And it is, among other things, ill-being, which is a big problem when patients get cell treatment and it is difficult to swallow tablets and things like that. Then a mouth film is overwhelming. And the second part of the question was, do we sell to clinics and hospitals? Yes, our business partners sell to clinics, hospitals and regions with deals and so on.

And you've been talking about this earlier when we've asked some questions about the time line. But I'm thinking about the next news for Accocort. What do you want us to look at? Is it the USA, or is it Europe, or is it the Middle East?

I would say Europe. Europe is probably the most important right now for us, from the way we get our applications submitted to the USA. What I'm looking forward to is to be able to communicate, write agreements with Europe, continue to be a letter of intent for other markets in Europe and so on. I'm also looking forward to the first orders from our new partners and so on.

So you can sum it up by saying that you will continue to have a very high pace and you will simply have to follow the press with some of the countries? That's right. Thank you, Jonas. Very exciting, as always, I would say. And if there are any viewers who feel that they need more answers to other questions, or the questions that have already been asked, then you can turn around with a warm hand. Where then, Jonas?

You can either look at our website, or we have a very well visited LinkedIn page as well. where we communicate what we don't communicate in press releases. But otherwise, press releases are also coming.

And with that, I say thank you very much. Thank you, Jonas, and thank you for watching and asking questions. Thank you for watching. Goodbye.