LUND Apr 29, 2020 (Thomson StreetEvents) -- Edited Transcript of Immunovia AB (publ) earnings conference call or presentation Tuesday, April 28, 2020 at 2:30:00pm GMT

Hello, and welcome to the Immunovia Q1 Conference Call. My name is Jas, and I'll be your coordinator for today's event. (Operator Instructions) I will now hand you over to your host, Mats Grahn, CEO, to begin today's call. Thank you.

Yes. Good afternoon or good morning wherever you are. It is a pleasure to welcome you to this quarter 1 report from Immunovia. And we will, today, after this slide, also go through the agenda, which is the first quarter highlights, of course. It's our response to the ongoing pandemic. We'll talk about the remaining steps to launch of IMMray PanCan-d, our test for early detection of pancreas cancer; touch on the commercial launch preparation activities; the prospective studies; and then there will be some short information about the upcoming AGM; and we'll finish up with questions.

So the first thing is the highlights that we have had in quarter 1. And we -- the most important thing is, of course, that the verification study of IMMray PanCan-d proceeds as planned. We did receive all the required blood samples and actually more from our key opinion leader network for the verification study.

The commercial team also worked hard with preparing the detailed plans for the launch, particularly during January and February. Then when the pandemic hit in March, these plans had to be adopted significantly to accommodate the situation. I will touch upon that later in the presentation.

And of course, what happened was that in-person activities has had -- such as conferences and patient organization meetings, both very, very important for awareness and knowledge about the tests, were canceled and now has been turned into digital activities in a successful way.

Furthermore, an important step in quarter 1 was that we welcomed our new Senior Vice President of Sales for North America, Mike Pettigrew, to the team. And also, we proceeded with our discovery study in lung cancer even after the partner on pharma side decided not to continue. We have all the control of our samples and continues as planned for the -- and we'll be reporting that in quarter 2.

Shortly on the -- before I move on to the COVID-19 situation in the Q1 report, you can also see that our cash flow for the quarter was about SEK 40.5 million. And more -- most importantly, we have SEK 223 million at hand, which means we have over a year with the current business plan going forward, which is great in these times of corona unrest on the market.

So let's move to the response to the pandemic. This is, of course, extremely important for all companies right now. And I'm happy to say that we are pretty well off, and I'll talk about the impact that then has happened.

We have, of course, work-at-home policies introduced for the employees. Even if you're healthy and you can work from home, they are doing so to minimize the risk of infections. If people have symptoms, cold and so forth, and then it's, of course, mandatory to stay at home. This leads to some reshuffling in tasks, of course, when people have to stay at home and so forth, but we have been able to manage that well this far.

When it comes to activities that require that staff is at -- in place, the R&D labs in Sweden, the clinical lab in Sweden and the production facilities, still fully operational. So we have managed very well during this first period of the pandemic, thanks to the loyal and flexibility of the staff, which we are really happy about.

The COVID-19, also for the ones who are not familiar to the local situation, in South Sweden hasn't had any major impact yet as opposed to the Stockholm area, for example. So in that sense, we're also fortunate to be located here in the south of Sweden. None of our employees are infected thus far here or in U.S. or elsewhere.

We, of course, constantly follow the guidelines and changes or orders from authorities in the geographies where we are active. And particularly focusing on U.S. in the right corner of this slide, the clinical lab is well prepared for -- with detailed plans for sales part. However, as we reported, first of April, the state went into a shutdown and stay-at-home orders for all people 1st to April 7. That has -- during, let's say, last weeks have been prolonged to May 4. And that, of course, is a challenge for us, where our staff in the lab cannot -- are not allowed to go to work and has to stay at home, and we'll touch more upon this later in the presentation.

When it comes to other activities to mitigate COVID-19, we were successful during Q1 to stock reagents, consumables and chemicals required for our work leading up to the launch and also having all instrumentation in place and installed the last things right before things got a little bit difficult. So we are very well equipped on that side and have been able to continue to fill up with what we need. So that is fully under control.

Moving forward then to our clinical collaborations with all the hospitals across the world. They are, of course, following their national guidelines and local guidelines and regulations, which means that many of our sites or most of them actually have stopped clinical trials in general, including sample collaboration. And this is because they, of course, have reallocated resources, clinicians and staff to COVID-19 care.

Some places even -- it's not even possible to get into the hospitals to pick up, for example, collected samples that are there. So -- and also individuals that are in the clinical programs, even if they would like to, they may not be able to travel or come to the hospital given the situation. That's why the sites are affected in that sense.

However, there are also a good situation for us because we managed to get all the samples we needed and even more for the verification studies delivered to our site in Lund before any of this shutdown. So we are in a good situation compared to many others there. And we are working hard in various ways to also secure the last ones for the validation, which we'll come back to as well during the presentation.

Let's move over to the remaining steps to launch and the details of some of the challenges we have and how we work with them. As you are aware, we are at the verification study. That is important to verify the functionality and the performance of the locked test in IMMray PanCan-d, both the signature and algorithms and so forth. This is done on the known samples, and we are working hard to complete that one that then leads over to this next step, the validation study. And we have come this far. And we have, over the years, overcome numerous obstacles. And now finally, we have to overcome the corona situation as well, and we will. We will be the first to market with this test that no one else has been able to do before. So we are still on the same path here. We are working hard to overcome the last hurdles caused by the corona. And everybody else is affected by that as well. So I'm very confident that we'll be the first to market.

Let's look into a little bit of the details of what's happening in Massachusetts, specifically where we are located outside Boston. This is now our main time risk, so to say, for our plan for the launch in Q3. And that is because the lab, as we have stated in the press release and also in the updates of 1st of April, is fully ready with the plans, what needs to be done from now until launch, including accreditations and sales starts and practical setups and so forth. However, since as of today, Massachusetts has extended this statewide mandatory closure or what they call nonessential to COVID-19 businesses and also stay-at-home guidelines all the way until May 4. This -- losing more than a month of practical work there is a challenge, which meet by doing replanning for different scenarios. We are reallocating tasks between Massachusetts, well, the lab in Marlborough and our team here in Lund, as far as possible. We are -- reallocation samples that are required and everything that is possible. It is a critical activity, and we need to get the lab opened, but we are in the hands of the authorities there. It's still possible to move to the targets, but it's the main risk, and I want you to be aware of that.

And looking a little bit into the detail here on these 2 last steps, the validation study and the -- verification study followed by the validation study. The validation is done on locked signature and algorithms on blinded samples, and we have most samples in-house but specific for the U.S. launch, and we are focusing to secure transfer of some samples that are already collected but are at hospitals where we currently can't get in. We are -- although in -- confident that we will be able to access them as soon as things ease up a little bit just in -- especially in U.S. hospitals. And then we are also getting positive feedback on collection of remaining samples, mainly for the CE marking that will happen in parallel. So we also, of course, use the mitigation of excess samples for the validation collection and reallocate it as much as possible to the activities in validation. So this is important to understand, and we are working really hard to meet this.

And I also want to make sure that you understand that the subset of the studies, particularly the validation, has to be performed in the CLIA/CAP laboratory in Marlborough for the U.S. accreditation to CLIA/CAP. And we are, of course, doing everything we can to minimize the impact that is closed down and are ready to go as soon as possible after the opening as soon as our people get into lab. However, we have worked hard on reallocating tasks, and our team in U.S. are actually doing a great work from home even though they can't be in the lab, even supporting with digital tasks, the people in here in Lund facilities and vice versa. So for example, doing important work on results coming from the scanners overnight, so they are ready when the people here in Lund come to work in the morning and so forth. So it's a constant replanning, reshuffling. We've been successful this far, but it is very tight, and we really need the authorities to open up the ability to go to work in Massachusetts.

Okay. Let's move over to the commercial side and talk about the commercial launch preparation activities. We mentioned -- I mentioned in the beginning here that the prelaunch activity that was planned in detail and ready to go had to be replanned in March because of important clinical conferences, which are really important to meet the key opinion leaders, the clinicians, the gastro people and so forth to introduce the test and make them really aware in a broader sense than we have now when we are closing in to launch. That is not possible face-to-face because the conference have been canceled during foreseeable months here of the launch.

Same thing, we have had the last year's extensive collaborations with the patient organization and taking part in numerous, what they call, walks or patient meetings in all the major cities basically in U.S. And since these ones were also canceled because we can't gather thousands of people in that way either, digital plans have been put in place, and we have also increased activities in a very, very innovative way from our launch team and our commercial organizations. Example of these are net conferences where we will present are now step by step getting turned into digital conferences. The latest example here is that the big and very important -- most important key opinion leader meeting in Europe called EPC has been decided -- that was planned to be in Paris now will be a digital full meeting where Immunovia is presenting the test and those things. So that's now set in stone, and it will happen.

Even more important in collaborations with one of the major patient organizations, the patient meet -- patient organization meetings that normally take place physically in different cities, there will be -- was a plan for a huge one outside U.S. in London summer. That one has now been turned into a virtual digital walk. And we have, I think, today announced it on our home page when and how it will happen. And that means that even U.S. investors are interested in the company, and the test will be able to take part in that one that way. So this is something we worked on our initiatives on our team with the patient organization in U.K. And it's first of its kind ever globally, and we believe this is a great concept that we will try to move further into other countries, as well in other languages. So if you are interested to take part in the virtual walk patient organizations, check it out on our home page, and it will happen in June.

Right. That was some examples. When it comes to the sales preparation and launch preparation activities that are maintained that relates to, for example, setting up the sales system, building the sales training packages for people they are on-boarding right now, completing sales tools and do a lot of target mapping, meaning that we, in detail, continue to map up each individuals in key hospitals and gastro centers that we want the sales force to pay visit to and target. So they are -- will be extremely well prepared and targeted to maximize the use of their time. So that's short about the commercial launch preparations, been a lot of work to reshuffle, but we believe we are in a successful path in this area.

Next slide is about the prospective studies. I mentioned in the beginning here that -- the sites, the hospitals that take part in this, and there are many, as you know, in the 3 studies we run. We run the PanFAM for the hereditary/familiar risk group, we run the PanDIA for the people who are over 50 and gets the first diagnosis of diabetes and PanSYM for differential diagnosis and rollout of pancreas cancer. All the 3 ones have been running, as you know. The one that is affected by this situation the most is the PanFAM because risk people have difficulties or cannot come to the hospitals for their checkups or leave the blood sample right now and/or the hospitals are reallocating resources to the COVID-19. That means that the PanFAM one will be postponed even interim and least to next year, 2021, Q1, Q2. That's for sure.

However, PanDIA, the big study that we run here in Scandinavia, in Sweden particularly will not be affected as this sample collected -- collection is very well advanced already at this stage. And actually, it's still ongoing, has not been closed down since it's running here in the south of Sweden, where the infection of corona has been very low this far.

When it comes to PanSYM, we are confident that the intervention phase that will -- which is planned to start early '21 is -- will be planted accordingly and move on there. So it's really only PanFAM that is affected. This is a much, much better situation than any clinical trials, for example, in the pharma side, which is very difficult if it's interrupted. So this is also, under the circumstances, under control.

Next area, and this is just a summary of the slide of the 3 prospectus studies as you have known them from before, and it's the ones we just talked about.

Finally, here now, the AGM announcements and details. And for that, I will leave the word to Julie Silber, our IR Director.

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Julie Silber, Immunovia AB (publ) - Director of IR [3]

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Hi, and thank you again for joining us. This is Julie Silber, the Director of IR, and I wanted to just do a brief announcement on our Annual General Meeting. As previously announced, the AGM will take place on Thursday, May 7, 2020, at 4 p.m. Details can be found for this on the press release for the AGM that was dated April 3 as well as on our website.

I wanted to take this time to just assure people that we are taking every precaution necessary in accordance with COVID-19 safety requirements and that the meeting will be kept as short as possible. No refreshments will be served, and seating will also accommodate the COVID-19 safety requirements.

Shareholders, agents and/or assistants who feel the slightest bit ill or have a relative that are sick or belong to the COVID-19 risk group should not attend the meeting. Shareholders should consider voting by proxy. The company, if necessary, may actually take further precautions at short notice depending on what is happening with the pandemic. We urge you, all shareholders, anyone who is interested in attending this meeting, to follow the company's website at http://www.immunovia.com for any updates to this information.

And now I will turn this back for Q&A.

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Mats Grahn, Immunovia AB (publ) - CEO [4]

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Right. And just before we start the Q&A, I will just have a few summaries on this one.

So actions taken successfully to date to combat the situation with the pandemic. We are on a critical time line but still on the time line, and we remain focused on the launch of IMMray PanCan-d. We will be the first to market. And we have, of course -- we are ready to adjust to unforeseen circumstances, and we know there will be more of that going forward, of course. Specifically, the Massachusetts closure is the current main risk, and we will work hard on that and update you as soon as we have a clear picture of what that means.

We will be the first-to-market solution for early detection of pancreas cancer. And this -- don't forget about it, it's a major market opportunity exceeding USD 4 billion over time. And this is a great place to be in, and we are sure we will take the chance to meet the remaining obstacles to get to that position.

So with that, I'd like to open up for questions.

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Questions and Answers

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Operator [1]

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(Operator Instructions) And we have just had a question come through, and this comes from the line of [Michael Loffman].

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Unidentified Analyst, [2]

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I was just wondering about the discovery studies of RA and lung. Are they still on schedule for Q2?

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Mats Grahn, Immunovia AB (publ) - CEO [3]

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Right. I suspect that I would get that question, so we actually prepared a slide for that as well, which you hopefully can see now. This is the general path of all studies, all the way from very early stage, all the way to commercialization. As you know, we are at the end of that now for IMMray PanCan-d.

And when it comes to lung cancer, it's in the analysis phase actually. We have run the samples that we did achieve from our previous collaborator and that are now in our ownership and use. So we will conclude that, as we have announced earlier in Q2.

When it comes to RA, we have the samples at hand. We have the clinical date. However -- and we -- but I can't be 100% sure when, so we will announce it when it's ready. And the reason for that is that we are now really allocating all the resources we have to the PanCan-d to make sure that we meet our objectives and targets on the PanCan-d side because the key value in the company right now and for the foreseeable future is to succeed and to capture the pancreas cancer diagnostic market here and really meet the time lines on this one. So we will need -- we are doing a lot of reallocation of people just to meet the effects of the corona and so forth for different tasks day by day. And at any case, we will not -- we will always prioritize PanCan-d. That's why I cannot be sure to promise when the RA data will be ready.

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Operator [4]

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The next question comes from the line of [Oskar Milner].

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Unidentified Analyst, [5]

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Last year around this time, you -- I think you estimated that Immunovia had connected with some 24,000 people via different patient organizations. Could you give an update on where you stand in numbers and so today?

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Mats Grahn, Immunovia AB (publ) - CEO [6]

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Yes. 2000 -- and that was -- the figures you referred to were 2018 approximately, what I can remember. And 2019, we had even more meetings. I believe it was around 35,000 people that attended these meetings, in U.S. particularly. So we spent the last 2 years in close collaboration with the patient organizations, and we visited and informed and met people and took contact details of people who wanted to be on our waiting list and information list and so forth from this one. So it was about 25,000 in 2018 and 35,000 in 2019.

We had planned for this year even more on these visits, and we did some of them this year as well before the corona shut all of them down. That's why we now have this initiative. We're doing digital walks, and it's actually our idea that our commercial team has come up with them and worked with the first patient organization here to run the one -- the big one in London. And we also hope that the U.S. side will jump on to that train, and we can continue with digital ones this year. This is important to continue to build awareness and demand from the self-pay group of -- particularly the hereditary/familiar group.

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Unidentified Analyst, [7]

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Yes. Great. I have a second question. A term I hear often is golden standard when it comes to these tests. Could you speak a little bit about what that is, what that means?

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Mats Grahn, Immunovia AB (publ) - CEO [8]

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Oh, yes. It's very nice to do that in this area. The problem with pancreatic cancer is that there is nothing really that functions when it comes to a blood-based test or a simple test for early detection. There is one single marker called CA19-9, and you measure one thing, which is a standard test. That's actually most often -- it's actually in the guidelines only used -- should only be used for recurrence monitoring, but it's anyway measured on many patients. I wouldn't call it a golden standard. It's the only thing that's there, and it's not really working very well by itself.

The other golden standard, you can say, in this area would be imaging then, which is the current way to diagnose -- only way to diagnose pancreatic cancer and will continue to be important. And that consists not only of CT, the standard CT, but it's more MRI and endoscopic ultrasound.

So in other areas of diagnosis, there may be golden standards of other blood-based or simpler tests and so forth. But in this area has been unmet clinical need, and that's one of the strategic reasons why we picked this one as a target for our first product.

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Operator [9]

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There are currently no questions in the queue. (Operator Instructions)

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Julie Silber, Immunovia AB (publ) - Director of IR [10]

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We do have some questions that have come in via the web section of this call, and I can actually ask some of those at this moment while we're waiting for more call-in question.

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Mats Grahn, Immunovia AB (publ) - CEO [11]

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Great.

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Julie Silber, Immunovia AB (publ) - Director of IR [12]

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The first one is, is the EU launch postponed? Or when do you expect the EU launch?

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Edited Transcript of IMMNOV.ST earnings conference call or presentation 28-Apr-20 2:30pm GMT - Yahoo Finance