Biovica International AB (publ)

and welcome to the BioWheka webcast for the second quarter of our fiscal year, 2024-25. Today, it's gonna 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 today. So, let's get started. The agenda is first a short introduction to BioWheka and our productivity. 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 summary, and then 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 analysts, our equity analysts, into the call to ask questions. And then after these questions, our ask will take questions from the chat. So you have the ability to use the function ask the moderator, and you can submit it, and then 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 BioWheka 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 doing the treatment. Before the treatment, we can give an indication of how aggressive the disease is, and also doing 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, it has a health economic benefit, they're very costly, up to $15,000 per month on patient or more. So you wanna make sure that the treatment also is effective. So these claims that I just made is backed up with some 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. And if you could summarize the data, you could say that especially in use with a common treatment within breast cancer called CDK46 inhibitor, we show that we are a strong biomarker that's complimentary and can assess response. These collaborations also have been made with some of the leading key opinion leaders or oncologists 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 1,500 patients. So this is evolving over time and is strengthening our clinical data. The clinical data is essential for us, it's 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 Henry could 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 where for patients with hormone-positive breast cancer, given CDK46 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. The number of patients is, the sources of course, Globocan, and then 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 showed 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 CDK46 inhibitors are expanding into this area. So the timing is here is excellent. And on these price levels, we still maintain very good in 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 bio-vika team here on site also. In the opening of the conference, we were, 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 CDK46 inhibitors approved in the early breast cancer setting for what is called an adjuvant treatment. And 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. That 3% more will avoid recurrence basically over those three years. So that is of course excellent. It goes from 87 to 90%. 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% 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 the coin is that you get adverse events or side effects from the treatment that you also wanna 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. So, and it's also time 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 wanna use as little as possible to ensure that the treatment is effective. The reason and rationale behind this is of course that you wanna 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, do perform this process. So I think for us, it's inspiring to see that both these initiatives or events are driving demand for divinity because we have a value proposition that is strong in both these areas. And the Project 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 that we're really, really well positioned in some areas that is very much top of mind and in focus within the breast cancer area currently and for good reasons. So if we move into BioVika and our highlights, if we start with the US, it's positive that our sales are continuing to grow. 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 establish that growth and the way our focus area is to work with companies that have a strong economic incentive to use our product. 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. So 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 positive. We also signed two new masters 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 than early breast cancer data that I talked about. We also had one trial from Italy where we compared against CT DNA. And we performed very well and could act as complimentary or even as an alternative to CT DNA, which is really, really important for us to prove that our product performs very strongly. And then also strengthening of the metastatic cancer era. There are, we got additional data that was important for setting cutoffs, et cetera, within 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 cashflow, but with a little bit more seven millions compared to the same quarter last year. And our accumulated sales was around four million Swedish runner for the first two quarters, which is in line with the same period last year. Few words about the adjuvant data and how it's gonna 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 a thousand patients and several tests at blood draws per and then different tests per patient. So it provides very, very solid data. And the second one was a one performed by Roswell Park in New York, smaller trial with both metastatic and early breast cancer for adjuvant treatment. But there are consistent results that Davidson provides value both before with a baseline test and also during the adjuvant treatment that you can monitor how effective the adjuvant treatment and before treatment, you can identify the patients with the highest risk to get recurrence in the incoming 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 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 and are 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, but 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 complimentary and that divotum are being used. And what would you, 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 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 divotum utility that was part of the trial that I talked about from 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. Okay, let me then go into the financial update. So our sales for this quarter and if you look at the first two quarters, both are in line or actually slightly below the sales from previous year, something that of course we're not satisfied with and we're 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 divotum 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 have a positive development in several areas but we want to accelerate even more. And if you look at the cashflow, 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 cashflow 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.

Thank you Anders. Good morning, good afternoon. I'm Hector Tamorini heading the US operation based in San Diego, California. I'm going to share an overview of the second quarter of this fiscal year based on the US operations. So if we go to the next one, please, the dividend sales as Anders mentioned in the Q2 of the current fiscal year continue the growth, even though as not as we plan or expected a bit slower. But it's remarkable, we had a 12% increase over the previous quarter, but even more exciting is that it was a 10-fold increase over the same quarter last year. So that shows the growth of the operations. The number of prescribers is also growing. We have about 11% growth and this is due to our reaching more prescribers, more physicians and more centers. But we definitely are looking into how to accelerate the growth to complete our goals. If we go to the next Anders, please. The factors that we noticed as the more critical ones in terms of growth, one is the small sales force as Anders mentioned, the adjustment in the company earlier this year left us with a small sales force. So we have limited resources to reach out to customers, which are spread out in a large geography and multiple institutions. And the other one is the test utility to physicians. One of the things we learned about Dividtum talking to many prescribers is having the TKAs result, the timing in kinase activity result is the first part. The second part of the utility is what to do with it. So what's the actionable plan the doctors can make based on that result. So we see this as an opportunity because we understand with all the clinical evidence that there is a potential for therapy optimization. We can find the minimal dose or the effective dose that also improves the patient's quality of life by reducing the toxic side effects of some of these treatments. And all of these factors ultimately will result in a benefit in health economics, submitting a patient to an ineffective toxic treatment that cost a lot of money has a heavy weight on the healthcare system. And we understand that a big contribution to move the balance in our favor would be working with integrated delivery networks, which I'm gonna explain a little bit more about what they do and how we plan to work with them. So we go to the next one, please. So these IDNs are organizations that manage end to end healthcare facilities, at least in the US and some are in Europe as well. And they have multiple healthcare centers, typically are regional, but sometimes they have national reach. If we look at the institutions that are within this category, we identify over 500 IDNs in the US. And if you take the top 50 or the 10% of them combined, they produce over 500 billion would be here US dollars in yearly revenue. So it's a huge, huge healthcare market or segment. Some of the familiar names of these institutions are in this slide and we are working already with some of them and we have several of them in our plan to expand our reach to these type of institutions. So the important part is what is the benefit that DVTUN can provide to these institutions. If we go to the next, please. In both indications, the metastatic breast cancer and the early breast cancer, so the adjuvant therapy, there are challenges that the physician has to face. One is are they using the effective dose? Is the dose being effective? The other one is that dose producing too many toxic side effects to the patient, which we see in our daily dealings with clinical patients. And finally, what's the prognosis? Is the drug or the combination of drugs that are being used producing a benefit to that patient that will result in long-term control of the disease? So one of the things that DVTUN can claim is that something, as Anders mentioned, we're hearing constantly here at Sandia and San Antonio, which is there are not enough biomarkers that produce a significant signal to the physician in the treatment. So right now, in many cases, the patient who's in an adjuvant therapy won't know, and the doctor will not know whether the disease is progressing until there is a clinical symptom, so the patient has new symptoms that alert the doctor, or they decide to go to an imaging study that also raise the alarms as the tumor is moving to the next stage. So a biomarker becomes a critical indicator. It could help make early decisions in treatment changes when the treatment is no longer working. It will improve the quality of life of that patient because it can reduce significantly the side effects if the dose can be reduced, and we've seen this already in practice, and all of these benefits result in a significant cost savings in the management of the patient. These institutions, the IDNs, who manage the whole treatment alternatives are keenly looking at ways to improve the efficiency of where they spend their dollars or their money in these treatments and to be more effective for the patient. So that's an area that we're going to work really hard in the coming months to increase our presence in these institutions. So I'm gonna jump to a completely different topic now, although it's related, so this is a regulatory situation. As Anders mentioned before, we are very proud that our laboratory in San Diego obtained what's called the out of the state permit from the state of New York. That was the last license that we were waiting to have. We passed with flying colors, no findings of any sort, and this opens the door for a very exciting market potential. New York state has, of course, a large population, but also very reputable institutions. Among them, Roswell Park Comprehensive Cancer Center, also the Memorial Sloan Kettering. We are already working with some of these institutions in New York on the research side, so their clinical trials, as Anders mentioned, Roswell Park, for instance. We worked in close collaboration, and now our expectation is in the very near future be also applying DVTUM to their clinical practice with their regular patients. So this completes our situation in terms of US approvals. We are now officially offering the test in the 50 states and Puerto Rico as well. And then the next slide is about the topic of the month of the week, at least, which is the San Antonio Breast Cancer Symposium. We are extremely proud, as you may have noticed, to have seven posters that were accepted. This is a huge increase compared to last year and a very significant presence of DVTUM TKA as a biomarker. Very well-credited institutions like the German Breast Group, and Emory Cancer Institute and others have presented their clinical trials. And there's a clear mention of DVTUM. So it's really exciting to see the presence and the increase of DVTUM in the market. So that's all for my update, and I'm going to hand it over to my colleague, Hendrik. So Hendrik, please, thank you.

Thank you very much, Hector. And hello to everyone. I'm Hendrik Winter, and I'm heading up our business development and especially focusing on our collaborations with Pharma and Biotech. So I'm going to provide you with the results and also some highlights from our Pharma business. So on the first slide here, I wanted to remind you on the different types of offerings we have for Pharma. So number one is that we provide TKA testing services and kit sales, and that service comes out of our US, Caplear Lab, and also our Swedish facilities. We also provide or offer collaborations on companion assay developments and commercialization together with Pharma. And then finally, we also offer sales and sustaining of these commercialized companion assays. Right now, our primary focus is really on the TKA service testing, and that's only natural because Pharma's way to a collaboration on developing a CDX goes through a very thorough evaluation analytically and also clinical of a new biomarker like TKA. So that is really where we put our emphasis right now is to onboard as many collaborators and work orders as possible to increase the likelihood of moving into this CDX collaboration. So if you look at Q2 results, we signed work orders for approximately 2.2 million Swedish, and we actually also are now negotiating another 2 million Swedish value work orders. We executed work orders in the surroundings of 750K, that is 90% up as compared to Q1. And if you compare to Q2 last year, the service activities testing Pharma's samples is actually up 275% as compared to last year. So it's just showing that we have more and more Pharma companies wishing to have these work orders performed and having their samples TKA tested. Yes, as mentioned by Anders, we did experience some challenges on the kit sales and that's mainly due to two customers finalizing some major studies, preclinical studies and cell culture studies in the lab and they buy our kits for these purposes, typically through CROs and we simply have less oversight of what the CROs are doing. And that led to the less kit sales as compared to last year. We also signed two MSAs and that brings us to a total of 16 master service agreements now with pharmaceutical companies. And we are now involved in roughly 15 clinical studies with Pharma. And as I mentioned earlier, this is exactly what we wanna do. We wanna move into the clinical studies together with Pharma because this is the way of documenting and convincing Pharma that our assay is capable of being used as a companion assay as a monitoring tool for the efficaciousness of the drug treatment. So on the CDX collaborations, I know this is a very often asked question, where are we? We continue the discussions with several of our Pharma companies on moving into or taking the next step on more closely collaborating on customizing our TK assay for specific drug needs. But it is something that takes time simply because, you need to have both the analytical and the clinical data ready. Currently the discussions we have with Pharma is focusing on CDKs and both mono and combo treatments. Next slide, Anders. So if I dive more deeply into some of the highlights with Pharma during Q2, I mentioned, we signed two MSAs and this was actually with Pharma biotech companies in US and also in UK. We have press released both of these and in both cases, it was around CDK inhibitors that were going to be monitored by help of our assay. So it's a typical, or it is in phase one, phase two trials here. We also initiated discussions or negotiations on two additional MSAs. And in this case, it is with tier one and the tier two Pharma companies. And again, it's CDKs and tier one and two tier two Pharma companies are also exactly where we want to be because those are the obvious candidates for moving into a companion diagnostic collaboration. They have the right size and the right focus and also the power to move into these kind of collaborations. And as mentioned that we signed the sync roof highest work order during our Q2. And we press released also that in September it was a work order above the two million Swedish. Then also very important, we passed the vendor security risk assessment at a tier one Pharma company. And this is important because it opens the door for BioVika and our TKA test to move into a regular provider of service testing to this big company. And we are now in discussions on placing our assay into clinical studies that are running in both US and China. So during the end of Q2, when looking at the total number of work orders running and work orders are the same as projects, we actually increased that number by 50%. Also earlier I mentioned by others. Then lastly, I just want to mention that we also during our second quarter filed national patent applications for Divitum as a monitoring tool within immune checkpoint inhibitors, and we have now filed in US, Europe, Japan and China. And next step is, you know, obviously no two to having these patents granted and that'll take some time, but it's a very important step for our company also. I think that was, you know, the highlights for the Pharma business currently. So back to you Anders and the summary.

Thank you very much Henrik and Hector. So summarize the quarter and also where we are. So we have a lot of progress and some challenges when it comes to the IBD sales, it's positive that it's still we're growing in these areas. And if you look at like a year ago, it's exceptional growth. But if you look over the last quarter, it's below our expectations. So the delay of those milestones is also partly explaining that the good thing now is that we've been able to get this one very important agreement in place that we were working for for quite some time, which is also, we expect to be able to drive sales on a totally different level as they are willing to roll this out in their organization to capture the economic benefits that they get from using our test. So we're on in currently in those discussions in order to agree on how to roll it out, both within the metastatic era and the early breast cancer adjuvant area. And we all always continue working into refining our business model and business plans to address gaps. So we've been doing that. We started with the focusing on the IDNs for quite some time. We've worked with our organization. We're constantly looking to learn from the ongoing business and also to find ways to accelerate growth through partnership and other things. So that work is constantly going on. I think the key achievement during this quarter must highlight the agreement with the major healthcare provider, the IDN that we talked about several times here, that the new pharma services agreements keep coming in and work orders that will lay a foundation for growth going forward. The adjuvant data is something that just the market potential for that area alone is five times making the entire breast cancer area six times the metastatic only. That's a huge, huge milestone. And it's also a strong contributor that we were able to, when we got that data, we were able to quickly close the agreement that we were discussing. One thing that we didn't talk so much about has been the data that we shown against CTDNA. We've shown that in the past, but yet another trial with more focus on the benefits of using Divitum was now presented at San Antonio. That is good, great for us in many ways, both in the clinical setting for use with pharma, et cetera. And maybe on this list, I think also the New York approval that will open up business in one very important territory where we all already now have partners that we collaborate with, Roswell Park for instance, they were presenting data from their clinical trials here at San Antonio. So they are already up and running with the assay. And now they have the possibility to be used clinically for their patients. Market driver, yeah, external events that happened was the approval of the second CED-K46 inhibitor within the early setting, creating a demand for a biomarker that is able to identify patients with high risk and also monitor the adjuvant treatment. And the same thing with Project Optimus that is being discussed more and more on the stuff of conference and FDA are requiring pharma companies to consider this when developing new therapies within the cancer area, which will also drive the demand and are already driving the demand for Divitum within pharma services, increasing the possibility for us to launch new products as complimentary or companion diagnostics driving revenues for Divitum over time. So we believe that we're taking great steps this quarter and looking forward, we look very, very positive on the future. And with that, I would like to open up for the Q&A session. I guess let's go by the list here. Let's start with Johan Honeiros from Redeye. So if you can let Johan into the call and see here Johan what questions you have for us today.

Can you hear me?

Perfectly. Very good.

Okay, let's start with the question then. Obviously sales in Q2 are modest and somewhat disappointing as you alluded to earlier. You are halfway into Q3 and how confident are you in improving recurring revenues during the rest of this year? It's by the end of April then 25.

Yes. Well, if you look at the remaining year until the end of April, I'm confident that we will improve sales. I think on the ongoing sales that we have clinically we are constantly growing. And with the new commercial agreement that will you will see the effects of that during the maintenance of the fiscal year. And also as Henrik said that we have increased the number of master services agreement and work orders that will translate into sales. Sometimes we see the layer a month or so that could make the revenue come in the next quarter. But over six months, I'm confident that that will also contribute to growth. So yes.

Very good. And the process then in this latest signing with the IDN partner. So you do expect some traction already during this period from this side.

Yes. Yes, we do. So the way we're thinking there is when it comes to the metastatic area our ambition is for them to start using it more or less starting January. They have already used it in smaller volumes and that's what they have seen the benefits and there are have actually been acting on it when it comes to treatments decision. So they're familiar with it in the metastatic area. And so we should see start there starting January. When it comes to the adjuvant which I think was a real eye opener and a game changer in this discussion. I think we will discuss more and also start a trial specifically about the adjuvant setting because and that actually is something that we will appreciate because then with a trial you get committed volumes. But about the downside of that that will take a quarter to get through the ethical committee and start up the trial. But then that revenue will kick in as well. And that's very positive. They understand that for every patient that they enroll in the trial it will be economic benefit to them as well as benefits for the patient. So that's also why there's a high motivation and incentive to both use it within adjuvant and in the metastatic setting.

Interesting and out of clarification then. So it's your IDM partner that will initiate this trial then to support the committee.

Yes, yes. So that's typically is very few trials that we are always doing trials with partners that have the patient and also typically are publishing the data. And in this case, the trial for the adjuvant will benefit both parties. They will during the trial already adopt to using our test in the adjuvant setting and that will give benefits already in the trial. And for us, the benefit will be of course revenues but maybe the bigger benefit is when the data is published because that's the intention. It will be practice changing not only for this account but for in the public domain and we can use that in applying for NCCN guidelines to strengthen the use for our biomarker also in the earlier setting. So yeah, there are a lot of benefits not only when it comes to revenues with this agreement.

Yes, and that's another question then. Obviously the data is very important. Will you be able to share any of that data before publication in discussion with other IDNs that you mentioned that there is a pipeline of other discussions as well?

Yes, I think the way it typically works is first of all, when you initiate the trial, it becomes public. So, I mean, you can read about it on clinical trials. There's a specific website for this. So there you will see the trial design and like the parameters around the trial. And then typically what happens, so it's like on last year's San Antonio or Washington University, they gave an update on how the impact trial has progressed and progressed well. So you can kind of follow the trial progression on these conferences over time normally. And then of course, when you complete the trial, you will then complete the data. You will typically present it on such a conference like San Antonio or ASCO, and then it will be published. That's the normal way of communicating. So, and then the, but yeah, you're not sharing data. You wanna share it in this public domain with this occasions, but you can do it during trial this way. Did you understand the somewhat complicated explanation? Yeah.

And also related then also clarification in this ABC market opportunity, will, are you certified to sort of deliver kits into this market space and what about the label?

Yeah. So, yeah, that's an interesting and somewhat also complicated question. If I start with the reimbursement part of it, maybe Hector, you can help me out with the regulatory side of things. So when it comes to reimbursement, especially for Medicare, Medicare, it's very, very important that you comply with their rules and their codes. And in our code for Medicare, the so-called PLA code, the scope for our assay is not limited to metastatic breast cancer. The code is defined as breast cancer. So this is something we had in mind when we applied for this. At the time we already had data from the early setting that we could provide. So we were able to get that code. So when it comes to the reimbursement and getting paid for our assay, we're covered as it is already with that setup. And it's also with the agreements that we have, the commercial agreements, there's no limitation that it's only metastatic, it's breast cancer in general. When it comes to the regulatory landscape, the 510K clearance and the CLIA lab, maybe Hector, if you wanna elaborate and say some words about that.

Yes, of course. Yes, of course. So in terms of the label, we don't need to make a change immediately, but in the long-term, yes, we will. BioVika obtained clearance from FDA with Divitum for metastatic breast cancer initially, but the test could be offered also in adjuvant breast cancer as a modified 510K clear test or basically a laboratory-developed test as long as we have clinical supportive data, which we have, the publications are. And that puts a restriction of which laboratory can perform the test, is the one that has that information. In this case, it would be BioVika. And the next step would be to gather all the clinical information and submit a 510K application that will allow to incorporate or expand the indication in the label. So at this moment, that's the plan.

Very

good.

Yeah. So simply put, yes, we can do this. We have a long-term, we will file a 510K and also because FDA wants to harmonize on 510Ks and by 28, LDT should be gone. But in that transition period, we were able to offer it through an LDT.

So you will be able to offer it as an LDT device in this period.

Yeah, so we can already, already now, we are offering a test service that oncologists can utilize and there's not always, we know the clinical status of the patient. So it could be an early, an adjuvant breast cancer patient already now, or actually a patient with another cancer. We offer this test service and we return the result. But the 510K clearance, what it actually, it doesn't forbid you for offering, for doing the test. It restricts what you can market just so we're super clear. So we cannot market the adjuvant under the 510K. Then we need to be specific that we offer that as an LDT just to get, do you understand the difference?

Yeah, yeah. And finally, on my side, excuse me, for a number of questions. Earlier you set out that if you stick to your sales plans, you were confident to reach break even on current capital base by, I think it was the end 25. Now you are clearly a bit behind sales ambitions and plans and the capital situation is, as a result, more stretched. What opportunities do you see? And do you see opportunities that are not necessarily diluting the number of shares?

Yes, we're looking into different options of both accelerating sales by partnership and thereby increasing our capacity. And with the milestones that we've just passed, I think this will strengthen our value proposition in that setting. So that work is ongoing and we're looking into means of strengthening our financial position as well. And also from that perspective, I think the milestones that we've presented here is helping us. But I think the most important thing also going forward is to continue drive sales. And although a delay, I think with what we're presenting here, we've also put ourselves in a better position for that. So I think that's the level of detail I can say. So I think that will help us as well. But yeah, we have a delay. We were expected to sign the agreements a quarter or two earlier. And that sales was that as a result of that was in our forecast, which is now pushed forward. On the other hand, we get the adjuvant portion that we did not expect. So hopefully we can accelerate sales and we'll come back with more details regarding an updated business plan.

So the ABC opportunity, do you expect that to support ongoing discussion both on the pharma CDX side and then on the commercial IVD sales partnering?

When it comes to, if I start with IVD and maybe Henry can comment on the pharma, when it comes to the IVD, definitely this opens up opportunity. One example is the agreement with IDN that the adjuvant is an important factor. Also our current customers that has been interested in using it in the adjuvant setting. Most of them are treating both metastatic and adjuvant treatments. So this will lower the threshold for them to start using it also in that setting. That will also increase revenues for us because there's more patients, more tests. So definitely so in the adjuvant setting, yes. Henrik, maybe you could comment how this will affect the pharma services side of things.

Yeah, absolutely Anders, I can do that. So there's no doubt this is gonna be perceived very positive by pharma. And at the center, Antonio, in meetings with pharma, these data are being presented. We haven't had a chance to present them before for several reasons, but they are certainly being presented now. If you think about it, what the data is really showing is that in the adjuvant setting, when you have actually removed the tumor, there's not supposed to be any tumor burden. But of course, I mean, there might be in some cases, there might be a little bit of a leftover of tumor mass. But even in those conditions, our assay is capable of analytically and clinically to stratify and monitor patients. And that's super, super strong, a super strong message to pharma and something they find very, very attractive. So yes, it's certainly gonna impact our sales and work with pharma in a positive direction.

Great, that's all from us and thanks for taking our questions.

So should we move on to Pareto? I think it's Chan who's on the call.

Hi, hi everyone, good afternoon. So yeah, a few quick questions from me. You mentioned that the small sales force in the US is kind of a challenge. Would you consider partnership or will you continue expanding your sales force?

Yeah. Well, both alternatives would be beneficial. At this point with our financial position, we're not gonna increase costs. So short-term partnerships. And I think if we would like to expand our own organization, yeah, I think we need to increase the revenues organically first to be able to do that and also enable to finance it. So I think currently we're looking into partnership and we have some discussion that was initiated already last spring. And I think with this new data and new milestones, that will also be very positive.

Okay, thank you. And also regarding the agreement you have signed with the US healthcare giant, could you maybe provide an estimate of how the sales potential of this agreement is and when do you expect the sales will start to pick up because of this?

Yeah, that's a good question. So the agreement currently is a client bill agreement, so which is very similar to the agreements that we've signed in the past. So far that's where we stand and it's also the price level is in line with what we have communicated previously. What we are now doing is we, since this customer has the ambition to more aggressively roll it out in order to capture the financial and economic benefits as well as the benefit for the patient, we continue with these discussions on how that should be done. So this is the first milestone and we're continuing discussion how we can leverage this and the volumes to come. We have of course an understanding of what the volumes that this customer have. And for us, a successful rollout in their organization would take us very close to a break even or even a break even going forward. So it's a customer with great potential for us if we would be able to roll it out fully in their organization. And the steps that we're not taking, we're discussing both the metastatic area and the adjuvant area. And the metastatic area, we believe there's a lower threshold to just start using it because there's a lot of data and they've used it themselves, others have used it. And there are some challenges that you can address right away like dosing, et cetera, using the test. So that will generate revenues from the start. And then with the adjuvant setting, I think both we and the customer are looking to do a trial that will delay the start of the revenues, but it will generate more committed volumes because you have a scope for the trial. But it will also generate a very valuable data from the outcome of the trial that will be useful not only for this, but yeah, for all customers for an entire market. Hope that answers your question somewhat.

Yes, perfect. That's clear. Thanks for taking my questions.

Very good, thank you. All right, is it Louisa from Kempen who's on the call?

Hi, yes. Can you hear me okay? Okay, perfect. Thank you for taking my questions. I just have two quick questions, maybe first regarding financials. Until what point and what does it cover exactly the current cash runway? And of course you've already spoken in terms of having to push forward. The forecast, when do you expect more or less that you will be able to disclose the new business plan?

All right, so first question, the cash position, 62 million and with a conservative sales plan that we presented, I think it's also in the report that we say that by third quarter, 25, we will need cash injection. We hope to of course improve revenues and prolong that and also come with more detailed guidance where we will come with that guidance regarding the business plan during the first quarter of the next year, so within the coming three months.

Okay, perfect. And in terms of of course further partnership agreements, what can we expect in terms of news flow for the rest of this year?

When it comes to new agreements and partnerships within the client or the clinical or the pharma?

Both, yes.

Yeah, both. Well, when it comes to the clinical side, we are discussing with several hospitals for additional client bill. And the opportunity that opens up right now is within New York. So we would like to close a client bill agreement there. And there are also hospitals that, one thing that has been a challenge for us is that we've been able to find early adopters that start using tests, are super happy and satisfied and use it for most of their, or if not all of their patients. But those are adopters are not, I don't know, interested or willing to act as sales reps for us. That has limited our growth. We have a few oncologists on most of our customers, but far from all. But there are hospitals that are looking to a more guideline approach within their hospitals. Everyone are using it the same way. So we are also looking to close a deal, but we are prioritizing that as well, because that will also give a quicker uptake for our test. So that kind of client bill, and also within the New York area is what we are looking at for the client, a clinical side. When it comes to the pharma services side, I know if you wanna give guidance there. Yeah, sorry, we also have Europe before I hand over to Henrik. In Europe, we are also in discussion and you can expect us to close agreements to cover additional territories in the coming months. And then we have Henrik, if you wanna comment on the pharma side as well, give some guidance on what we can expect in terms of upcoming agreements and so.

Yeah, certainly, and as I can do that. So during the last calendar years of 2024, we've signed five master service agreements. And expectation is to continue with that flow, continue both within the companies focusing on CDK inhibitors, but also moving into immune checkpoint inhibitors, signing master service agreements and work orders with pharma focusing on that drug type. And then certainly also benefiting from the new data within the argument setting, but it's still within the CDK inhibitors that we talked there. But it just demonstrates the capabilities of the TKA assay to do amazing work when only having very small tumor mass. So, I mean, expectations is to really continue signing more master service agreement, same level. So I'm expecting also five plus for the next calendar year. And I'm also expecting higher or bigger work orders because we are getting into bigger and bigger clinical studies with pharma.

Okay, perfect, thank you so much.

All right, we have two questions also from the chat. And I think Henrik, this is a little bit for you to sort out what we have communicated when it comes to the sales. It says, can you explain how to reconcile today's numbers when it comes to compared to earnings call? August was a good month when it comes to services. It was approximately 300%. Yeah, Henrik just give some background on that.

Yes, correct. So August was a record month when it comes to the service testing piece. That was the highest month ever. September and October was decent okay month, still better as compared to last year. And that's also why this quarter was at the same level as our former record quarter, same level. I think what I also tried to explain was more the kid sales that really hit us. And that kid sales is a little bit unpredictable in a way that it goes through the CROs and hence kid sales could come in later this year as compared to last year. This is unfortunately not, we don't have the same predictability on that part of the business currently. But the service, just to underline that our TKA testing service is significantly increasing during this fiscal year and continues to increase.

Thank you Henrik. And then we have the last questions from the chat. Can we expect more IDN agreements in the near term and the Europe revenue will that continue? And start with the first, we are continuing to target IDNs. The good thing with IDNs is that we believe they have a good target. They have a very big potential for us and we have a very strong value proposition because they will have the health economic benefits using our test. And the agreement that we just signed will act as an important reference in that process. The downside is that it also takes some time. So we'll continue and over time you can expect us to deliver more of those agreements, yes. And when it comes to Europe, we, the way it's a little bit like the kit sales within pharma, we sell like a batch of kits at the discrete time points. We know that with the agreements that we've signed, there are milestones that they need to purchase kits coming up. So we know that we will have some sales coming up. And I think the big potential also is to extend territories which as I've previously said, is something you can expect to happen also in the coming months. Very good, thank you all for this session and all the great question and the interest in Bayerwica. I think I'll flip back to the Christmas. This is how they celebrate Christmas in San Antonio with a lot of color. It's not so much snow, but I think we'll say thank you and we will wish you happy holidays and a Merry Christmas when that arrives in a few weeks. Thank you very much and all the way from Bayerwica.