Biovica International AB (publ)

and welcome to the BioVica webcast for the second quarter of our fiscal year 24-25. Today, it's going to be me, Anders Rylander, presenting together with my colleagues Hector Tamburini, Head of US Operations, and Henrik Winter, our SVP Business Development. And I will cover for Anders Morén, who is not participating to date. The agenda is first a short introduction to By Weekend or Productivitum. We'll go through the highlights during the second quarter. I'll do the financial update before handing over to Hector, who will do the update for US, and Henrik will do the update for Pharma Services. And lastly, I'll do a summaries and we will open up for a Q&A session. the Q&A session will be performed as we usually do it. We will let our equity analysts into the call to ask questions, and then after these questions are asked, we'll take questions from the chat so you have the ability to use the function Ask the Moderator. and you can submit it and I will ask, we will answer as many as we can. We will limit the call to an hour. And if we're not able to answer all the questions, we will ask them in writing and put them as an appendix to this presentation that will be put on our webpage. So if we go over to a very short introduction of what BioVica is and Divitum does, This is a schematic illustration of how the product works. The product divitum measures an enzyme which correlates to cell proliferation. And cell proliferation is something very essential when it comes to cancer, of course. That's how cancer grows. And with DIVITUM, we've shown that we can provide very important information both during and both before and during the treatment. Before the treatment, we can give an indication of how aggressive the disease is and also during treatment to provide feedback if the treatment is effective or not, if you should change dosing or change treatment. This is very important, first and foremost, for the patient, of course, making sure that the patient gets the best possible treatment. But it's also important for healthcare providers and payers as treatments within this area has a health economic benefit. They're very costly, up to $15,000 per month and patient or more. So you want to make sure that the treatment also is effective. So these claims that I just made is backed up with solid clinical data. To date, we have more than 30 published and peer-reviewed articles. The majority of this data is in the breast cancer area. Breast cancer is our initial application and our focus area initially. If you could summarize the data, you could say that especially in use with a common treatment within breast cancer called CDK416 inhibitor, we show that we are a strong biomarker that's complementary and can assess response. These collaborations also have been made with some of the leading key opinion leaders or ecologists in the world, some of them that are presenting here at San Antonio where we currently are, which is of course a very important way for us to get the message out. Talking about San Antonio, we're in the middle of this conference and currently we have seven clinical trials being presented here at the conference. So this list of studies will be extended with seven more and around 1500 patients. So this is evolving over time and is strengthening our clinical data. The clinical data is essential for us. It's the foundation for commercializing the product. This is what has led us to where we are now with all the milestones that we have passed, including the 510K clearance in the US, being included in the Medicare system with a price for Medicare that we can claim and get paid for. and also the commercial agreements and the revenues. It's also been essential for building the portfolio of pharma collaborations that Henrik will talk a little bit more about. So clinical data is essential to drive revenues eventually. Talk about revenues and market potential. If we focus only on our initial application, that's the breast cancer area, So far we've been focusing on the metastatic setting for patients with hormone positive breast cancer given CDK4-6 inhibitors and other types of targeted treatment or endocrine treatment. We've been focusing on the markets US initially and now we're also active in Europe through partners. And the market potential is estimated based on the number of patients living with the disease, times the treatment schedule, times the price for the test. Number of patients is, the source is of course Globocan, and the treatment schedule is following a patient once per month, because that's the treatment schedule within this area. initially and then over time quarterly until the patient progress when you go back to more monthly follow-up. With the data that we are now presenting at San Antonio, we show that we have a strong value proposition also in the adjuvant setting in early breast cancer when the patient is receiving adjuvant treatment. which is opening up a new application for us where we estimate the market potential to be five times the size of the metastatic setting. And so the total breast cancer area would then be six times as big. So this is a great development for us. This is something we talked about and it's now happening. It's also happening so we present the data also at the same time as the CDK4-6 inhibitors are expanding into this area. So the timing here is excellent. And on these price levels, we still maintain very good gross margins over 85%. So if I should move in a little bit to our second quarter that we are reporting now and the highlights for that quarter, I'd like to start with the San Antonio conference. It's the number one conference in breast cancer held every year here in San Antonio, Texas, this year with over 11,000 participants. And we have a strong BioVica team here on site also. In the opening of the conference, as I said just in the middle of it, there were two key topics that was in focus. The first one was that there is now since like a month and a half two months ago two CDK4-6 inhibitors approved in the early breast cancer setting for what is called an adjuvant treatment. You see the results from that. The positive thing here is for the patients that by going through three years of such treatment after you have done surgery, you will get a benefit of about 3% when it comes to disease-free survival. The 3% more will avoid recurrence basically over those three years. So that is, of course, excellent. It goes from 87 to 90 percent. At the same time, it comes with a cost at around $15,000 per patient and month that I just said. previously at over 36 months for a big patient group. About roughly 25 to 30 percent of the patients in this group would then be eligible for this treatment according to the guidelines If you can't point out the high risk patient that really benefits from the treatment, then just treat them all. So this is the ongoing discussion at the conference. How can you do this? Because not only to avoid cost, because the other side of that coin is that you get adverse events or side effects from the treatment that you also want to avoid. if you don't have to accept them because of that you need a more aggressive treatment. This is an important topic and it was the topic that opened up the conference this year. And it's also timed very well with our adjuvant data. The other thing that was a key topic in the opening up of the conference is the FDA Project Optimus. This has been going on now for some time. And the objective for the Project Optimus is that we should go from a maximum tolerated dose to a minimal effective dose. You want to use as little as possible to ensure that the treatment is effective. The reason and rationale behind this is of course that you want to minimize the side effects for the patient while maintaining the efficacy of the treatment. So in theory, this is all good and the patient is benefiting from that. The challenge here is to find efficacy biomarkers that can help you perform this and do this treatment, perform this process. so i think for us it's inspiring to to see uh that both these uh initiatives or or events are driving demand for for divitum because we have a value proposition that is strong in both these areas and the product optimus the optimal dosing is something you would like to do both in the adjuvant setting and as well as in the metastatic setting so Our conclusion here is that we're really, really well positioned in some areas that are very much top of mind and in focus within the breast cancer area currently, for good reasons. If we move into, by weekend, our highlights, if we start with the US, it's positive that our sales are continuing to grow. so so we're happy with that we had even higher ambitions than the 12 it was higher last quarter so we're working hard to to establish that growth and the way our focus area is to work with companies that have a strong economic incentive to use our products And we were able to sign an agreement with such an IDN, integrated delivery network, which we call here, it's also a healthcare giant. So that's a very, very important milestone for us in order to continue develop the US market. Another important milestone that took place was that our CLIA lab now got the last certification in the US required to be able to serve the entire country, all states. And that was the New York approval that took place after they did an audit at the lab in San Diego, where we passed without any remarks. So a great achievement from the US team. When it comes to the pharma services, we continue to take work orders. This one was the largest so far. And that, of course, will lead to revenues going forward. So that's possible. We also signed two new master's agreements. It's like a frame agreement that you will then have work orders within that frame agreement. So both these events will drive revenues going forward. And Henrik will talk a little bit more about this later in the presentation. When it comes to the clinical, I already mentioned the San Antonio conference that we currently are at. We had seven posters presented at this conference and that includes not only the adjuvant and early breast cancer data that I talked about, we also had one trial from Italy where we compared against ctDNA and we performed very well and they could act as complementary or even as an alternative to ctDNA which is really, really important for us to prove that our product performs very strongly. And then also strengthening of the metastatic cancer area. We got additional data that was important for setting cut-offs, etc. with the unit that we have for the assay, so that was also Very, very strong data on that area as well. And then the financials, we include our cash flow, but with a little bit more, seven millions compared to the same quarter last year. And our accumulated sales was around four million Swedish kronor. for the first two quarters, which is in line with the same period last year. A few words about the adjuvant data and how it's going to be applied. So it was actually not one, but two trials that has now was presented yesterday, these two. at the San Antonio conference. One was done with the German breast cancer group. The trial was called Penelope B. It's a very, very large trial with over 1,000 patients and several blood draws and then dividend tests per patient. So it provides very, very solid data. And the second one was one performed by Roswell Park in New York. a smaller trial with both metastatic and early breast cancer for adjuvant treatment. But there are consistent results that Divitin provides value both before with a baseline test and also during the adjuvant treatment that you can monitor how effective the advent treatment and before treatment you can identify the patients with the highest risk to get recurrence in the coming future. So this is really, really strong data that opens up a new opportunity for us. And the timing with the approval of CDK inhibitors within this early setting and the need for better biomarkers that that creates is fantastic. So super, super grateful and happy for that. And here's just an explanation so you understand this process. We have so far up until now been active in the metastatic setting, where we have performed monitoring over several lines of treatment, typically for these type of patients around three or could be even more. We have assumed three years in our market estimates because during the first three years, that's typically where you get these type of treatments that we are complementary and that DIVITAM are being used. We assume around eight tests per year for this patient population. That's behind our market potential estimates so far. Now we are adding adjuvant therapy. So that's the therapy that you do after the surgery. And then you follow the patient, you do select treatment, you do the adjuvant treatment, you monitor that, and you follow up. And that's the new TK or divitum utility that was part of the trial that I've talked about on the previous slide and where we had such excellent data. Adding the adjuvant also has helped us in the commercial discussion. One example is the agreement with this healthcare giant where this part of our value proposition played an important role of securing that agreement. Let me then go into the financial update. so our sales uh for for this quarter and and if you look at the first two quarters both are uh in line or actually slightly below uh the sales uh from from previous year something that uh of course we're not satisfied with and working hard to improve If you look what's behind the figures, if you break down the different areas, you can see that we are actually growing in three out of four areas. We have growth in US and also starting up sales in Europe. And within the pharma services area, the actual service sales is growing also. and where we have had poor progress with the selling of dividend kits, where we sell through CROs and we don't have the same insight into the sales process and forecasting. So the IVD side of the business was up 54% and the services business was up even more actually. so we're we have a positive development in several areas but we want to accelerate even even more and if you look at the cash flow it's been improved even this quarter just as last quarter and it is because we're running our operations more effective and are managing our cash better and it's a consequence of that change we did six months ago or so when we changed our organization and has made it slimmer. We're currently behind plan to be cash flow positive. We had higher sales targets set for ourselves, but with the milestones that we now have taken, we're working to make up for that. And here's the cash position.

Here we're slightly better than we were last year. With that said, I'd like to hand it over to Hector.

Hector, so you can go through and update about the progress on our US business. Please, Hector.