Orexo AB

Your line is muted. Good afternoon, everyone. I'm Niklas Sorensen. I'm the CEO of Orexo, and welcome to this third quarter interim report from Orexo. Together with me today, I have Fredrik Gerstein, our CFO, and he will take us through some of the financial numbers in the presentation. So we label this quarterly report Orexo in transformation and it has indeed been an intensive year from a transformation perspective and we start to see that we get into this new platform focused company that we want to become and have made quite a lot of progress in our development plan during the quarter and as you know also announced a right to issue which will support us to take the company all the way through the transformation and pass some critical timelines in our development programs. Summary a little of where we are and why do I claim that we have made important progress in our development programs is that we have for ICIPRI on the 29th of September we resubmitted the file to FDA and we expect a six months review time which would take us into the end of first quarter and we will have our next product approved in the US. On OX640, we had our R&D accepted, which is maybe feeling like a small step, but it's incredibly important because that is the one confirming our clinical trial program that we are going to follow through the development of 640 and other data points that we need to collect. We have also started our manufacturing, and we have manufactured 12,000 units of OX640 in commercial scale. come back to that a little later, but right now we're doing some testing before we can do the final release of these for the clinical trial. 486.390, the project we have together with BARDA. BARDA agreed to extend the initial development stage and also provide an additional $3 million to the overall funding. So on each of these three programs, we have made good progress. When we look at our other programs, we have just went out slightly after the quarter ended with our first in vivo study results from oral semaglutide. As you know, we have done it before in nasal. The numbers were encouraging. It was our first oral formulation, and we saw that we had comparable bioavailability as the reference tablet, which is a high bar, being the first formulations that we're testing in oral formulation, and the reference tablet has been developed over several years, or many years. Vaccines, we have a collaboration together with a well-renowned research institution in the U.S. where we are applying for non-diluted grant funding to basically test a Morphox platform on different vaccine projects. For SobSolve in the U.S., we have in this quarter, it might pass some of you, but every quarter we're reviewing our progress and see where we believe we will be with the earn out. And we based on the current trajectory of subsoil sales in the US, which is progressing well, we have come up that we have to increase our provision with 21 million Swedish kronor. So we are increasing the amount that we expect to get paid in the earn out in early next year. We also announced that we have we are very close to settlement. We have agreed in principle on the main terms with the Department of Justice. It's something that we've been forced into in about six years. It's taken a lot of effort, a lot of money also, to get to the point we are in right now. But I'm quite pleased that we actually can see that we're ending this process and we have reached this agreement in principle with the Department of Justice. A very, very important cornerstone in this transformation we're entering into as a company. And then we have our rights issue that we announced recently and that we are now going to conclude during this quarter. The transformation that we are into, as you know, we sold the SobSol, right? And what we're really trying to do now is we are restructuring our balance sheet. We're restructuring operations. We're streamlining operations. That means basically cutting costs in both Sweden and in particular in the US. As mentioned before, resolving the DOJ investigation are important. And now with the rights issue, We also feel that we have the financial flexibility that we need to take this company all through the transformation. And what we really want to do is to take our existing programs into a partnership and then start development programs together with other companies based on the Amorphox platform. And we are making some decent progress in this space, which is basically a plan that we set up for the company when we took the decision to sell off the US business last year. When it comes to the right issues, it is something that will give us the flexibility to continue the development through critical milestones. We'll come to the financials later, and I can say the financial result that you're looking at for this quarter has nothing to do with how the financials will look for the next year. We are now into the final stages of cleaning up the balance sheet and some of the payables we have from SubSol when we sold off SubSol also to streamline the US operations And with the money we have now, we feel we would be in a good place to take the company through to this transformation where we sign partnerships and get partners to both co-finance and also fully finance development programs on the basis of the Amorphox platform. Looking at how we are allocating the funds, we are seeing that 640 remain one of the larger expenses. It was that for this year and also in this quarter. Then we have our 390 development where most of it is financed by BARDA, but OREX still have to take some. But our continued project with Semaglutide and other GLP agonists, we have in there vaccines. We are looking for non-dilutive financing, but we will need to take some expenses for that. ICIPRI, we said 10%. I think that's a high number because we are now basically done with the majority of the work. But as it is with any program, Then for ICIPRI, we will need to continue monitoring shelf life and also reliability data. But that's a significantly lower cost than we have right now. And then we, of course, have the DOJ and general strengthening of our working capital.

So what is the focus for the company moving forward?

It is really partnership, partnership, partnership. We hired a new head of business development, Raheel Inassati, who have been very active and already now have some good leads and also been part of the program that we have in our semi-glutite and get this industry partner to expand the collaboration. But we are looking now to basically expand based on the knowledge we have for the GLP agonist or semaglutide to get this partnership to expand and deepen. We are looking in vaccines to test new vaccines with partners where we basically collaborate with them supplying some of it, OREX with some of it, and we're seeking non-dilutive funding opportunities together with research institutions. And we have applications, processes that have started in the U.S. On the development program, it's again, that's why we have ICIPRI, we have 640. We are looking for a partner. We do need to take those programs to the next critical value inflection point. That means for ICIPRI and approval for 640, our next pivotal trial. But we have started the partnering programs for both of them. And then we are looking basically for companies who would like to work with our platform for whatever project they have. again an area that we need to build and to be stronger but where we are getting decent amount of interest but before it's worth anything we need to get a signed contract and get a signed partnership ICIPRI we resubmitted as we guided in the end of Q3 that means we have an approval expected in the end of Q1 next year we are still waiting to get the PDUFA date confirmed by FDA that should happened relatively shortly. We will continue to test reliability and stability, but that would be a significantly reduced expense than where we are right now. One thing that is interesting in the market for ICIPRI is that more and more data shows that patients who are overdosing with opioids in the US are administered more than one dose per immediately after they are found by rescue workers, first responders and bystanders. And that's basically because you're seeing that the current low dose liquid products that we have on the market are not enough to basically rescue a person who are overdosing on a synthetic opioid. This is helping us because the market is now recognizing that these low dose would need to go up in dose to basically be able to rescue the people. And that's where a high dose product like ICIPRI comes in well with all of the other advantages we have with ICIPRI, including temperature stable performance, for example. Moving to 640, we are now on track to start our pivotal trial. It's the plan we have communicated for the last year. We are following that right now. We have met a lot of milestones for the program in the quarter, both the IND acceptance, our first commercial batch. We are now doing the testing to confirm it meets the quality requirements before we can release it, and that will then take us into we can start the clinical trial. And the clinical trial we are planning is the first pivotal trial, and that's basically testing a nasal allergy challenge study where we're testing the products on allergic rhinitis conditions. meaning that we're exposing people who are allergic to pollen for pollen to get a reaction in the nose and see that the product has a good uptake. We've done that before, but not with the final dose and not with the final product. So this will be an important milestone for the company also. And that's coming into these value inflection points. The next thing that will happen is that when our quality department have gone through all of the documentations from the commercial batch, we can then release it. That means that we have met the high standards that the FDA has set for the kind of rescue medications in the commercial manufacturing. This will enable us to start the pivotal trial. So we're expecting to announce that also in this quarter. And then with the results, we're saying now first half of next year, we are expecting this to come early. But as it is with clinical trials, sometimes you need to do additional analysis and that could push us into the beginning of Q2. But the expectations is it should be early next year, all depending on the quality of the data we get and if there's something surprising coming out of this study. Looking at the market for epinephrine products, we had some good Q2 numbers from the incumbent in the nasal market in the US. We are seeing good development in reimbursement with a decent price premium to some of the generic injectables in many markets. So this is promising for the market, which is still in its infancy. It will be interesting to follow how this market is evolving, which is an important impact parameter for potential partners who wants to work with OREX on this. The market is competitive, but looking at the competitors in development and on the market, we see that there are unique profile and advantages with our Morphox technology that works 640. For example, the rapid onset, it's very stable, extensive absorption, and we believe we can have a long shelf life on the product also. And then, of course, a value in the market is that we have a patent protection both for 640, but also many of our other projects, which are our technology on projects on their Morphox technology, which is reaching into the 40s. The partnering process is ongoing and we're seeking a global partner. Could be different regions, but we are in a global process and we are expecting that the proceeds from that will take this product all the way to the end and be the financing of the final pivotal trials. So in the forecast that we have and the expectations that we have for the company moving forward, we have not included the next round of clinical trials needed to take OX640 all the way through the end. We're expecting that is coming out of this partnering agreement. Semaglutide, we went out with a press release saying encouraging clinical results. We had, as you know, in 25, we had our first study where we saw we had much higher results by availability of the amorphox-based product in the nasal delivery compared to the oral formulation. The study we did now was on a more advanced reference tablet. It was also an oral tablet. It's the first time we have made an oral tablet with the amorphox technology. We only used four different formulations and this is done in a relatively short timeframe and that we in this short timeframe could come up with a product that actually mirrors the or have comparable bioavailability as the reference tablet was encouraging but of course to be excellent we need to have better bioavailability than products that are in the market and products that are in development so this is giving us a starting point for continued development and we're quite pleased to see that the industry partner we have worked with in the oral tablet are interested in continuing the oral but also interested in expanding into other routes of administration that we're now exploring how that project could look like and what would be the work plan for that before we can start the project. But we have a good dialogue and a strong interest, and it's basically not if we should continue, it's more about how we should continue. So to sum up, so from an operations perspective, what are we looking for in the near term? We are in a partnering focus across the company. 640 and ICIPRI, of course, top of the list top of the list because we think that's where we have most value. So we are working actively to find partners 640 on a global scale, ICPRI on a US scale. We're also looking to expand our Amorphox partnerships to both reduce our expenses but also to reduce risk and of course for some of them contribute positively into our profits But it's going to give a stake into new projects by having other companies working with our Amorphox platform. And then we want to expand into new areas, basically seeing where do we think this can work. And we are still very interested in biomolecules and very encouraged, not only on the semaglutide, but how that can be applied on other peptides. It's also in vaccines, the data we have generated with Abira, but where we're now looking to expand with new partnerships to get more proof of concept in vaccines is going to be incredibly important in our efforts to expand the use of Amorphox. And with that, partnerships, cost coverage, and revenues for the company. With this, I will leave the word to Frederik to take us through the first part of the financial presentation. Frederik, please. Thank you, Nikolai.