Avacta Group Plc (AVCT) Earnings Call Transcript & Summary

Welcome to our results presentation and business update. If I could go to Slide 3, please. So I think there may be some people on the call who are new to Avacta, so I'll give a very quick overview and introduction to the 2 business units. The therapeutics activity, exploiting the Affimer and pre|CISION platforms based in Cambridge, U.K., there's around 33 staff there, about 20 of those PhDs. And there is a strong in-house focus on immuno-oncology, which obviously we'll talk through as we go through the presentation, but also global partnerships in oncology, autoimmune disease and cell and gene therapy. The Diagnostics division is based in the North of England in Yorkshire, where there is about 40 individuals, including the plc headquarters, about 22 of those PhDs, focused on in-house diagnostic product development. And we will obviously spend quite a bit of time on the COVID-19 diagnostic development as well as many global partnerships, of which the vast majority, I'm afraid, are undisclosed at the moment. But we'll talk about the progress in that area as we go through. Slide 4, please. Myself, I'm Alastair Smith, Chief Executive Officer, and we have on the call as well, Tony Gardiner, our Chief Financial Officer, who will take you through the financial highlights in a moment before we get through to the business update. Slide 5, please, and on to Slide 6. So I won't read through all the operational highlights from the RNS announcement this morning because we'll touch on all of these as we go through the presentation. So we'll talk about our partnerships and our collaboration with Tufts around the pre|CISION chemotherapy platform. On to Slide 7, please. We'll also give you an update on the in-house therapeutic programs, focusing in particular on AVA6000, and then spend some time talking about the Diagnostics division, the progress there. And in particular, of course, there's a huge amount of interest at the moment in the developments around the COVID-19 antigen test and the potential commercialization of that later this summer. Slide 8, please. Tony, would you mind talking us through the financial highlights, please?

Sure. Hi, good afternoon, everybody. The revenues for the period are for a 17-month period as we changed our year-end. So we're reporting through the 31st of December. Those revenues were GBP 5.5 million, which included the upfront technology access fee payment from LG Chem Life Sciences, which was $2.5 million. The overall revenue compares to the GBP 2.8 million, which was for the 12 months ended the 31st July 2018. The adoption of the IFRS 15 accounting standard on revenue recognition hasn't really changed the way that the group presents its results. So there's no significant impact on there. The operating losses for the period amounted to GBP 18 million compared to GBP 10 million for the 12-month period previously. And the increase in this is driven by the higher research and development costs that we've had, which were GBP 10 million in the period compared to nearly GBP 4 million in the previous year as we start to build towards the Phase I clinical trials later this year. The actual reported losses for the period were GBP 15.6 million. But that takes into account the fact that we get an R&D tax credit of GBP 2.4 million, and that will come in later in 2020 now to our cash balances. During the period, in October 2019, we completed a GBP 9 million placing, which was designed to help fund the AVA6000 program, which we'll talk about later. And we closed with just under GBP 9 million of cash at the end of December. We completed an extra fundraise of just under GBP 6 million in April 2020, which gives us at the end of April, about GBP 10.5 million cash, which will support the group's plan for the remainder of 2020 through 2021 and into early 2022, as things stand. And I'd just like to move on to Slide 9 and hand back across to Alastair, who will give a business update.

Great. Thanks very much, Tony. So going on to Slide 10. What I'd like to do just before we go into the business update is really just take a helicopter view of the substantial activity that's been established within Avacta over the past few years and, I think, in particular, reassure shareholders that we've not suddenly put all of our focus on to our COVID-19 development at the cost, as it were, of some potentially extremely valuable therapeutic and other diagnostic activities. So -- and again, for people who are new to the company, this is probably a nice overview. So on the therapeutic side, in the Therapeutics division, we have 2 proprietary platforms, the Affimer platform and the pre|CISION platform. Within the Affimer platform, we have our own in-house immunotherapy pipeline and a number of partnerships with global pharma and large biotech companies, which I'll talk a little bit more in a moment, so I won't dwell on the detail here. But combined, they offer the potential of more than $0.5 billion of clinical and preclinical earn-out milestones. We've also established very recently a joint venture with Daewoong Pharmaceuticals, which is, I think, the largest revenue South Korean pharmaceutical company. And that is to develop a new generation of stem cell therapies. We'll talk about that in some detail as well. Again, for those new to the company, I think an interesting comparator on the therapeutic side is Ablynx, who many of you will know. They have or had a similar therapeutic protein platform. And they were acquired a couple of years ago for about $4.8 billion by Sanofi, partly for the platform and partly for the soon-to-be approved first of their drug -- drugs to go through development. So that's the Affimer activity in the therapeutics business. The pre|CISION platform is a chemistry that allows us to dramatically reduce or remove the side effects of chemotherapy. And again, we have a strong in-house pipeline building around that pre|CISION chemistry and a very strong partnership with Tufts University from where the IP originated, combining the Affimer and the pre|CISION platforms to develop TMAC drug conjugates. And we have some really, really encouraging data around the first 2 of those TMACs, which I will talk you through on a subsequent slide. So that's the therapeutic business unit based in Cambridge, around 30, 33 people. The diagnostics activity, centered in Yorkshire, near Wetherby, focusing on infectious disease, therapeutic drug monitoring and point of care. That obviously feeds in very, sort of, pertinently to the requirements for the COVID-19, for that infectious disease testing, which we'll talk about in some detail. Very good growth, as Tony described, in the diagnostic business, which is revenue generating. Not yet profitable but certainly, we are very focused on bringing that business unit to profitability from both the revenues from the partner programs that we have as well as licensing the pipeline of diagnostic products that we're developing. So hopefully, that's a useful overview for those not familiar with the company and also a reminder that there is substantial shareholder value to be delivered long term out with the COVID-19 testing opportunity, which in itself is potentially very significant. On to Slide 11, please, and on to Slide 12. So let me run through an update on the Therapeutics division activity. So I'll begin, first of all, with AVA6000 and our path into the clinic later this year. So the brief introduction again for those not familiar. So without going into lots of technical detail, the pre|CISION platform, as we call it, is based on chemistry that we have exclusively licensed from Tufts University in Boston in the U.S. And that chemistry is a -- what's called a substrate for an enzyme called FAP. And FAP will cut that bit of chemistry. And when that chemistry is attached to a chemotherapy, it effectively inactivates the chemotherapy until FAP cuts it off, activating the chemotherapy. Now the interesting point here is that FAP is present in large quantity in tumors. So it's highly upregulated in tumors but virtually nonexistent in healthy tissue. So the FAP only activates the chemotherapy or releases the chemotherapy from a drug conjugate, only does that in the tumor, thereby sparing the healthy tissue from exposure to those very potent chemo toxins. So the clinical benefits of that, I guess, are fairly obvious. But just to talk through them, the fact that you only release the active chemotherapy in the tumor means that you can increase the maximum tumor exposure of the active drug without exposing healthy tissues. And that improves the tolerability and safety and therefore, the therapeutic index of these very effective drugs. But many of them aren't tolerated by patients very well at all. And an improved therapeutic index will lead through into improved efficacy. I think an important point to make as well is that although we are focused on a prodrug, a pre|CISION prodrug form of doxorubicin as our first program, this chemistry can be applied equally to other anthracyclines and a range of other chemotherapies. So once proven with the first of these pre|CISION chemotherapies, the concept can be extended to a considerable pipeline. And we have another 10 chemotherapies that we've at least synthesized, so we know they can be made, and one other, which is a proteasome inhibitor, where we've got some very encouraging data around efficacy in a pancreatic tumor model, which I'll talk about elsewhere, not here today. So that's the introduction to the pre|CISION platform. Going on to Slide 13, please. So specifically looking at the AVA6000 pre|CISION form of doxorubicin, which we call pro-doxorubicin. Briefly, the background is this is a generic drug, doxorubicin is a generic drug, been around for many years, have some fairly serious cardiotoxide effects. So in fact, patients can only manage a maximum of 6 cycles before the cumulative damage to the heart becomes very serious indeed and can lead to irreversible heart failure. In fact, many patients don't make it to 6 cycles because it's very difficult to tolerate. As a result, patients can't be treated for very long. And the overall survival has not improved so dramatically as you would like. We've done a lot of work recently since Christmas on understanding the market opportunity in a lot more detail. And just to really summarize that because there's an extensive piece of work being done with key opinion leaders around the world and consultants to really pick apart the potential market. Just to summarize that, the -- in 3 indications, so advanced soft tissue sarcoma, breast and ovarian cancer, so just in those 3 indications and not yet thinking about any others and looking at the U.S. and the EU alone and not the rest of the world, there is a peak sales opportunity of $1.5 billion, we believe, from -- for this pro-doxorubicin drug. So it's quite a significant opportunity in that fairly focused indication area and market. The top right-hand side of this slide shows you why we are so excited about this technology and this particular drug. So what you see there, in the histogram there, is the results in a cancer model in mice. And on the left-hand side, what you see is the amount of active doxorubicin in the heart and in the tumor when the animal is treated with doxorubicin. So standard doxorubicin. And as you would expect, you see exactly the same exposure of the heart and the tumor to the doxorubicin drug. And that is the issue, of course. And the animals there have been dosed at 2 milligrams per kilogram of animal. If you look on the right-hand side, so this is the dosing of animals with the AVA6000 prodrug, at 6x the dose of the doxorubicin on the left. At that dose, you start to see some activated doxorubicin appear in the heart because there is a background level of FAP in healthy tissue. But at that point, you see 18x more of the active drug in the tumor. So the exposure of the tumor to the drug is considerably higher than the healthy tissue. And that clearly is the improvement in therapeutic index that we intend to demonstrate in humans in the Phase I study. So to give you an update on the time line, and I know everybody is interested in the effects of COVID-19 on our development time line. In summary, we don't expect a significant impact, although I think it would be naive to pretend that there's going to be no impact at all. Clinical trials have essentially been halted in the U.K., and that's obviously because of the demand on the hospital resources. But that's expected to be relaxed later this year. And although there is expected to be some focus on COVID-19 therapies, at the moment, we don't believe that is going to introduce more than a quarter's delay. That's the guidance we're giving at the moment. So we've made good progress in terms of the CTA filing and drug product manufacture. So we expect to make that CTA filing in Q3 rather than Q2, which was our original plan, and dosing first patients late in the year or early in '21, depending on the availability of patients and hospital resources. So not a significant delay and everything is moving forward in the right direction. Okay. So on Slide 14, please. So moving from the pre|CISION chemotherapy to the other in-house program that we are focusing our resources on at the moment, and that is the TMAC drug conjugates. And as I said, we've got some very encouraging data that I'll introduce you to on the next slide. So to remind you of the concept here, this is the combination of the pre|CISION platform and the Affimer platform in a single drug. So this is a single infusion for the patient, a single drug that combines a chemotoxin, a drug warhead, as it's often referred to, with an Affimer checkpoint inhibitor using the pre|CISION chemistry to allow the warhead to be released, but only in the tumor microenvironment. So the beauty of this approach is twofold. One is you can -- imagine using several different types of warhead of drug that have a, what is called a pro-inflammatory response. And the whole concept of the TMAC drug conjugate is that you stimulate the immune system to attack the tumor tissue by releasing this warhead in the tumor microenvironment, creating a big inflammatory cell death in the tumor microenvironment. And that encourages the immune system into the tumor. And that accesses the 80% of patients who don't normally have any immune attack on the tumor, so-called cold tumors, and we'll see that on the next slide. So the point of this is to use the warhead to inflame the tumor, to light up the tumor, to turn it from cold to hot. And then when the immune system begins its work in the tumor tissue, we have the Affimer checkpoint inhibitor and, in the first instance, a PD-L1 checkpoint inhibitor that prevents the tumor from hiding from the immune system. So the PD-L1 Affimer blocks the PD-L1 receptor on the tumor cells that allows it to evade the immune system attack. So what you have here is a completely novel -- and a concept has been patented, a patent application by ourselves and Tufts jointly for this idea of releasing a warhead in the tumor microenvironment, synergistically acting with a checkpoint inhibitor. If we could go on to Slide 15, please. So these are the data that I've hinted at. Let me just talk through these slowly so that I can explain them. So the first of the drug conjugates. And we released a little bit of data earlier this year around PD-L1 with what we call the I-DASH inhibitor or here, the shorthand for that is VbP. So this is the PD-L1 I-DASH drug conjugate and then a second drug conjugate with an undisclosed Affimer target on it at the moment. So we're not, for IP reasons, revealing what the second drug -- what the second TMAC is at the moment. So the data you see here are for a colorectal tumor model in mice, and this model is called the CT26 model. And it is, as I said on the slide, renowned for being a cold tumor that is very difficult to get a good response in. Very difficult to get a response at all, to be frank, and to take the tumor into regression, i.e., for it to shrink to a small or unmeasurable size is very rare indeed. So what you see in the data is on the left-hand panel, you see the control. So this is effectively no therapeutic treatment. And what you see there is the growth of the tumor in the animals, in 10 animals. The middle panel shows you the effect of treatment with the PD-L1 I-DASH or VbP TMAC. And then you can clearly see the reduction in tumor growth for most of those animals. And 30% of those animals, the tumor goes into complete regression. On the right-hand panel is the undisclosed Affimer with the same I-DASH warhead. But in that case, 60% of the animals, the tumor goes into complete regression, so shrinks to effectively zero. What is also very encouraging is that some further work that's been done at the National Cancer Institute in the United States shows that if you then rechallenge the animals at a later date with the same tumor, so you try to reimplant the same tumor in the animals, they're immune to that tumor a second time. So those animals that have been treated with the TMAC developed a T cell-mediated immunity to that type of cancer, which is obviously extremely encouraging for the TMAC concept around combining the drug warhead, the inflammatory effect of the drug warhead, the immune system response and the checkpoint inhibition. So we have further work to do, of course. The objective is to now get to the point of selecting a clinical candidate for an IND filing next year. So that is our objective, and we'll certainly keep the market updated as we run more animal models and so forth. And ultimately, we'll talk about the specific Affimer-I-DASH combination that we take into the clinic. Okay. Slide 16, please. So those were our in-house programs that we're focusing our resources on now. And I'll just -- for the next couple of slides, I'll update you on the partnerships that we've established. So LG Chem, as I'm sure you remember, is a multi-target deal that we signed last year, $2.5 million upfront, around $5 million in preclinical milestones and then a potential earnout of more than $300 million in the clinical development milestones and then royalties on the future product sales. All of our research costs are covered, and we have retained some of the commercial rights to the Affimers that we developed in this program with LG. So we made really good progress. Before Christmas, we announced that LG had chosen 2 more drug targets. So the first drug target, we made really good progress with during 2019. They've now selected 2 further drug targets, and we're now working therefore on 3 programs with them. We expect, later this year, to provide them with the candidates for the second and the third targets. And there will be multiple preclinical milestones related to those 3 targets, which could deliver up to $5 million of those preclinical milestones possibly this year. But I think it's more likely to be in '21 and possibly in '22. So the public statement that LG Chem made was that they expected to file an IND for the first of these programs in 2021. So that's the -- that's obviously their responsibility at that point, but that's the guidance that they've given. There will be a further payment to that point, but we've not disclosed what that is. So the ADC Therapeutics partnership, which we established in September or October last year, that is now underway. We are -- so that partnership is around developing Affimer drug conjugates. So not TMACs, but conventional drug conjugates using ADC's warheads, the toxins that they have, which they've licensed from AstraZeneca. So this is a company that's heavily backed with Board presence by AstraZeneca. So this program is, again, fully funded by ADC Therapeutics. So all our costs are covered, and we have retained commercial rights to the Affimers outside of the specific area of this application. And there will be development -- clinical development milestones and royalties on future sales of drug products. So they've now selected the first target and provided us with that target, and we're now in the process of generating Affimers against that first target. If all goes well, we expect to see candidates and characterize candidates in the second half of this year. Now when we transfer candidates over to ADC Therapeutics, what they will do is construct the drug conjugate, i.e., they will put the PBD warhead on to the Affimer. And when they reach a certain point in the preclinical development, they need to make an option payment to take those Affimer candidates forward into development. So we anticipate the first of those in 2021. Slide 17, please. So the partnership with Daewoong Pharmaceutical is slightly different. That's a joint venture. So the joint venture, called AffyXell, is focused on stem cell therapies but the next generation, if you like, of stem cell therapies or to put it crudely, turbocharged-stem cell therapies. And what we have demonstrated with Daewoong is that stem cells, which are used for tissue regeneration and so on, stem cells can produce, can manufacture and secrete or spit out Affimer therapeutics. So you have the opportunity to turbocharge, as I said, the stem cell therapy by giving Affimers to deliver at the site of action when it's doing its tissue regenerative or anti-inflammatory activity. So the idea is that we will generate Affimers against certain immunomodulatory targets, which Daewoong -- AffyXell don't want yet made public. We are now working on 3 targets for them in parallel. So there's a great deal of excitement and energy gone into this from AffyXell and Daewoong on that side. We're working on 3 targets, and we expect to be able to transfer those over to them in the second half of this year and into '21. They will then modify the stem cells to be able to secrete those Affimers and start to put them into in vitro models, cell-based models before going into animals. Just to give you some feeling about the potential value of this joint venture, which is entirely funded by Daewoong and, in the future, by VCs, we're not contributing to the ongoing running costs of AffyXell. In fact, quite the reverse, all of our research costs are paid for by the joint venture. To give you some idea of value, a couple of comparators recently were acquired in the U.S., and both of them were preclinical, and both went for around $1 billion. So this area of cell and gene therapy and particularly this concept we have of the next generation of cell and gene therapies is likely to be extremely valuable. And we own 45% of that joint venture. Moderna was our very first therapeutic partnership, which we signed in 2015, and that really triggered the whole therapeutic activity, really only 4-and-a-bit years ago. And that established the therapeutic business unit. That was a multi-target research deal. To cut a long story short, we generated a number of Affimer drug candidates for them, and they exercised a commercial option last year to take some of those Affimer lead molecules against one particular target into the clinic. And the next milestone, which is entirely under Moderna's control, I should say, is the IND filing for a future clinical study with those Affimers. Okay. On to 18, please. And on to 19. Okay, so we move on to the Diagnostics division business units and a quick update, then we'll focus more on the COVID test development. So again, for anyone new to the company, the business model here is pretty straightforward. There are 2 themes to our activity. One is to develop a small pipeline of diagnostic tests in-house in Avacta, I'll update you on that in a moment, with the view to OEM and licensing those to partners. The reason we are doing that is because it is taking a long time to get partners to do that under their own steam. You'll see that we have nearly 30 Affimer development partnerships and evaluations ongoing and one licensing deal so far. So we need to accelerate that process. And we are doing that by developing Affimer diagnostic assets of our own to get to a point where there's a working assay, which we believe we can license more quickly. And I'll update you, as I said, in a second. We still do a number of projects for large pharma companies providing Affimer research tools. But the vast majority of the work now is focused purely on the diagnostic market. But we do continue to do those pharma services projects because they are very straightforward for us. We have 100% success rate. They are worth GBP 40,000 to GBP 50,000 of revenue for us each. And as I say, we have 100% success rate and now multiple repeat customers. So right now, that's not a revenue stream that we want to ignore. Recently, we reinforced that focus around the diagnostic activity with the appointment of David Wilson, who some of you may know. He's very well known in the IVD market. He spent many years and led the development of Genzyme's diagnostic business a number of years ago. So a real industry veteran, who's been an excellent hire, I have to say. On Slide 20, please. So a very quick helicopter summary of progress in the diagnostic business. Tony outlined the increase in revenue there and substantial increase in revenue and order book going into this year, which is far, far stronger than we've had going into any previous financial year. But I think the pie chart to the bottom is probably most relevant to this, which is that we are now seeing those evaluations, which have taken a long time, 5 of those now successfully completed and entering licensing discussions, with another 17 in the pipeline that are completed. And the Affimers are with those partners for evaluation. So this whole pipeline has moved on quite considerably forwards. We have another 7 new projects just started with partners, primarily diagnostic partners. And I think it's worth saying that the business development activity has slowed down a little bit, of course, under the current lockdown situation where we're not traveling to conferences and so forth. But a lot of the business development is done on the phone and online. So whilst there is a slowdown in our ability to get to some key events, we still continue to build that pipeline, and those 30 you see there are ongoing active projects with partners. Okay, on to 21, please. So those are the partnerships. 21 is a very dense slide, and I don't intend to read through all of this, but it's there for you. This presentation is on the website. So you can go to the Investors section of the website and download this. But I wanted to give you some reasonable details to have a look later on the current diagnostic product, in-house diagnostic product development pipeline. So the SARS-CoV-2 antigen test, we'll cover in the next section. I'll just very quickly touch on the others. So TRAIL and CRP are 2 biomarkers of sepsis, allow you to differentiate between a bacterial or a viral infection to appropriately use antibiotics. It's a massive market. And we have both of those tests now completed and ready for evaluation by third parties. And some third parties are already beginning to look at those 2 tests. Estradiol is a test used for fertility treatment. It's part of an endocrine testing market, which is worth about $8 billion. It's difficult to find the value specifically for estradiol testing, but it is a widely used test. And what we have generated is a test that is more sensitive than the existing test, which is the real gap in the market, and again, now ready for evaluation by licensees. The D-dimer test is a cardiac marker used to identify risk of thrombosis. Again, it's a very large market. It's a $2 billion market by 2025. We've developed an assay, a label-free assay. And we're now developing a second assay, which I won't bore you with the details with, but it's called an agglutination assay. Finally, the vitamin B12 assay. Vitamin B12 is measured when there's concern around anemia and some other indications. The gap in the market is that current tests measure the total vitamin B12 in your blood, not the active B12, which is the key. And we have developed a number of Affimers and developed an assay, which only measures the active vitamin B12. But the really interesting commercial point is that we have freedom to operate around Abbott's antibody-based IP, which basically stops anyone else from getting into that market. So that is -- 5 of that assay is having its final tweaks and will be completed in the near future. So you can absorb that information at a later date. But clearly, we have a number of opportunities now ready for commercialization. And that is happening, and that will happen with as much vigor as we can whilst the lockdown is still in place. Okay. On Slide 22. So the -- a real spotlight, I guess, has been shone on the strength, the power of the Affimer platform. We generated binders against the coronavirus in a matter of 4 weeks, which even for us is extremely quick, but really importantly, absolutely specific to the SARS-CoV-2 virus and don't cross-react with MERS or SARS or other coronaviruses that we've tested it against. So a little bit of background first to the collaboration with GE Healthcare or Cytiva, as it's now known. There are 2 types of tests, as I'm sure you're all becoming aware. One is typically called an antibody test or a serological test. And it tells you whether you had the virus in the past. So when you're infected, it takes -- with any virus but this particular coronavirus, it takes about 2 weeks for your body to develop a sufficient number of antibodies to fight the virus but also to be detected. So in fact, an antibody test isn't useful for 10 days to 2 weeks after you're infected. And you are most infectious at the early stage of infection. So that's what an antibody test does. But what is really required is the antigen test. And typically, that's been done with PCR to date. So the nasal and throat swabs that you've seen on TV. And then that's what we send away to get the laboratory test carried out. The -- I guess, the downside of that is that the throughput is limited, the turnaround time is a day or 2, and it's really not suitable for screening very large numbers of people in the population. So what we are doing with Cytiva is to develop a lateral flow test strip. So identical in principle to a pregnancy test. So 1 line indicates a negative result, 2 lines indicates a positive result. And it will detect the spike proteins that you see on the outside of that virus particle. Okay. Let's move on to Slide 23, please. So the -- I think the view now around the world is that not only do we have an urgent need right now for testing -- for antigen testing large numbers of people in the fight against the pandemic. But as we go through the summer into the rest of this year and into next year, there will be a demand for hundreds of millions of tests per month globally to identify healthy individuals, so antigen testing, to allow us to exit from the lockdown and get healthy people back to work. And unfortunately, there will be a long-term demand for testing because this disease is very likely to become endemic in many societies. So this is a long-term testing demand with a very high testing rate in order to be able to get healthy people back to work. So the test that we are developing will be a rapid results in 10 minutes. It will use saliva as the test sample and can be used by health care professionals or indeed consumers at home for self-testing. So it is ideal, unlike PCR, for that sort of mass screening of populations for the infection. So the -- most of the tests in development around the world right now are PCR tests or antibody tests. So just to give you an idea of what the competitive landscape might look like in the future, there's a small handful of rapid antigen immunoassays being delivered -- developed, sorry. And I think the reason for that is that it's obviously challenging to get a new reagent against the new virus. I mean we are very fortunate that we have the Affimer platform, which is ideal in terms of quickly developing highly specific reagents. We hear that those companies trying to develop antibody-based -- a mouse antibody or a rabbit antibody against the virus, are struggling with the specificity. And we have the, as I said, the significant advantage of being able to generate very specific Affimer reagents, which we've already demonstrated here in the laboratory, do not bind SARS, do not bind MERS and do not bind other coronaviruses that are very closely related and are endemic in the population. Okay. If we could move on to 24, please. So in terms of progress, I'm sure you know the history of this now. We announced a deal with Cytiva at the beginning of April, and that is to develop the saliva-based rapid test strip for the antigen testing. It took us 4 weeks from beginning. So we started about 10 days before the deal was announced with the selections. And it took us 4 weeks. So on April 22, we announced that we had generated more than 50 Affimer reagents to the SARS-CoV-2 spike protein. And it's important to note that we own all the commercial rights to the Affimer reagents and the rights to the test that's developed. And it's entirely to our discretion how we commercialize those reagents. So whilst Cytiva is a -- obviously a great partner with real scale to have on board, we will be putting in place other test strip manufacturing partners and OEM partners because the capacity -- the production capacity, considering what we expect the demand for this rapid antigen test to be, cannot be supported with a single partner. So we will put other partnerships in place to develop lateral flow test strips, and that is entirely within our discretion. So over the past 10 days or so, we have been manufacturing reasonably large quantities of the Affimers that we've generated in order to provide quantities to Cytiva and the others that I've mentioned, and those will be shipped in the next few days. So we now have significant quantities to be able to provide to our development partners to get on with the diagnostic device development. Cytiva aims to have prototype tests over the next few weeks. And obviously, we'll keep you up-to-date with progress as that unfolds. And then we anticipate clinically validating those tests with patient samples at sites in the U.K. initially. And we are in the process of putting those sites in place. So those are clinical sites that are able to handle real patient samples with live virus. So those will be in place very shortly. And I expect that we will validate the tests in other geographies outside of the U.K. in due course as well. So we aim to have a validated and CE marked, so that's for sale in Europe for professional and consumer use, as soon as possible in the summer. So the middle of summer is when we are aiming for. And we, as I'm sure I said in the announcement, the -- my colleagues are working through the bank holiday weekends and will be, again, this bank holiday to make sure that happens as quickly as we possibly can. We've also announced another partnership with a company called Adeptrix, which is a U.S.-based diagnostic proteomic company. And the reason this is really interesting from our perspective, I think I said, when we announced the COVID-19 development, that we wanted to commercialize these Affimers on as many diagnostic platforms as possible to increase testing capacity. And Adeptrix had developed diagnostics based on something called a mass spectrometry. It doesn't matter what it is, but it exists in pretty much every hospital microbiology lab around the world. And the really interesting thing is that nobody is using those mass spectrometers for COVID-19 diagnostics. And yet with Adeptrix' BAMS tests, you can run 1,000 samples a day on one of these mass spectrometers with one technician. So the potential is it's not the same as a lateral flow device, of course, but it is quite significant. So we worked with Adeptrix before. They've developed Affimer-based BAMS tests before. So we're confident that they can do that. And it is a fairly quick process. So certainly similar timescale to the lateral flow device, if not faster. So again, we'll keep you up to date as we go through that development with Adeptrix. And we're already putting -- getting discussions going with the manufacturers of the mass spectrometers. So that's the likes of Shimadzu and Waters and Agilent and Bruker, who would take the test kits to market for us and for Adeptrix. So it would be the mass spec manufacturers who would provide the test kits into the hospitals for testing. So it's -- so the business model is a straightforward OEM licensing from Adeptrix and Avacta to a large mass spec manufacturer. So it might be worth just talking for 30 seconds because I've been asked a lot of questions about in terms of the lateral flow device with Cytiva, what are the typical costs of these items. And I can give you some guidance. We certainly haven't reached definitive prices yet. It's too early in the development process to be doing that. But if you take, for example, a consumer self-test -- if you were to buy an HIV test online, for example, you would pay about $30 for that. So a single consumer self-test for that sort of infectious disease, typically, $30. Clearly, if those tests are going to be sold in larger quantities, packs of 10, packs of 20, that price may vary. And I think also the market for corporates to test their workforce where you would be expecting to sell tests in very much more significant numbers, the prices would be lower. And the cost of goods, typically, again, you can find this out for yourselves on various sources, but the typical cost of goods would be maybe $2. Certainly, at high volume, down to $1 or even below. So that's the sort of margin that we should be thinking about. Not yet because we're not putting any forecast in related to COVID-19 testing, but if you want to start thinking about the potential value of that test when we bring it to market, those are the sorts of numbers you should be thinking about. Okay. If we could go on to 25, please, and I'll wrap up. So yes, I mean, the message that I wanted to get across really is that we -- other things have not been put on hold in order to deal with the SARS-CoV-2 antigen test development. We continue with the group in Cambridge, is obviously entirely independent of the Diagnostics division. And so they continue with partners and with our in-house programs to develop a broad number of opportunities based on our 2 platform technologies. The rapid antigen, the COVID-19 rapid antigen test, we do expect that to lead to a very significant revenue stream, both health care professionals, corporates and direct-to-consumer, which could ultimately fund Avacta's other programs, so genuinely transformational for the group. We've got a number of well-established now therapeutic partnerships in place and, I should say, further discussions ongoing. We've not stopped seeking out new therapeutic partnerships and diagnostic development partnerships. And I'm reasonably confident we'll see further news flow in that regard in the coming months as well. So there's really a sort of substantial, sustainable growth opportunity for shareholders in Avacta now. And I'm very happy to pause there and take some questions, if there are any.

Thank you, Alastair. We've had many questions coming in. I'll try to get through as many as we can before 6:00. The first question that's come in is, the developments involving COVID-19, whilst welcome and currently headline catching, but isn't the development involving chemotherapy-related treatments the key to long-term prosperity of the company?

Okay. Thanks. Hopefully, I've covered that yet, and I would totally agree. And I've tried to make sure the message has got across in the presentation that we've not -- we're not putting at jeopardy any of those developments, which we've talked about for a long time. So I totally agree that we have to keep the activity in the therapeutic business moving, and it is. So the COVID-19 opportunity is an incremental opportunity. There has been a bit of resource obviously diverted in the diagnostics business to focus on it. But yes, I entirely agree that the long-term value is driven by the therapeutic opportunity and, of course, the long-term value of the diagnostic sales, particularly the COVID-19 sales.

And in percentage terms, please, can you say how confident you are of the COVID rapid point-of-care test being successful in terms of development and passing FDA approval?

Yes. I'm not sure I can do in percentage terms. But I can tell you that we have developed a number of lateral flow tests ourselves and so have partners. So some of those evaluations that we talked about being successfully completed are exactly for lateral flow tests. So we can have a great deal of confidence that lateral flow tests, using Affimers, can be developed. So I think we should be confident that the test will be developed. And then the regulatory process is a process. There is no reason at all why we should regard that or why you should regard that as a significant risk. So I think the risk of development at this point, having now generated the Affimer binders that are specific to the target, that's the key technical risk overcome. So I think we should be pretty confident from this point.

And can you talk about the likely timescales involved with the development and subsequent regulatory process for this COVID rapid point-of-care test?

Yes. Sure. I think I covered that in the presentation. So we will do everything we possibly can to be able to do that as early as possible in the summer. And I think midsummer is certainly what we believe is doable. But that is an extremely tight timescale for a diagnostic development. But it is doable, and we're putting in multiple development paths in parallel to be able to derisk that and deliver that as quickly as possible.

And how is your testing system holding up against new devices made by other firms and maybe offering improvements in ease of use or quickness and convenience of results?

I think if that's referring specifically to COVID-19, then -- well, I mean, more generally, we have the benefit of the Affimer platform, which can deliver very high quality, very specific diagnostic reagents. And until we begin to see the performance of other tests appearing publicly and indeed our own, we won't really know how they compare against each other. But historically, the tests we've developed with Affimers have been very good in terms of sensitivity and specificity. So we expect that to be the case here as well.

And are your tests able to be easily adapted as new information about the virus is discovered?

That's an interesting question. I presume that's referring to potential mutation. So a couple of things I would say about that is that we know that this particular virus doesn't mutate significantly or very quickly. So that's obviously a positive from everyone's perspective. Secondly, we are, in parallel, developing further Affimers against other targets on the virus that are less likely to mutate, if that becomes an issue, which we don't believe, by the way, that it will at the moment. And obviously, everyone's seeing how quickly we can develop binders to a new target. So if the world was put in a terrible position where this virus mutated dramatically, then we would simply generate a new test.

Now Alastair, how are you managing your resources to meet the demand generated by meeting deadlines to address the urgency of COVID-19 response and the longer-term, cancer-based projects? Are these long-term projects in danger of being neglected due to current activity?

Yes. I think we've probably covered that. So the therapeutic team is entirely separate from the Diagnostics division. So there is no drain on those resources at all. We are in the process of adding operational and regulatory capacity because clearly, we need that now. So we're doing that initially through consultancy to get an immediate expansion of resource and through recruitment. So the question's a valid one generally, but there is no risk of using resources that are focused on our therapeutic partners or our in-house drug development programs.

Are the partner companies and manufacturers of instance of the testing working under license to ourselves? Or can they market the product in their own name and pay royalties to Avacta?

Okay. So if I understand the question correctly, the point I made was that we own all the commercial rights. So the types of manufacturing relationships we have will be either licensing an OEM so that a third party can manufacture and produce the test under its own name or it will be purely a manufacturing relationship where the product bears our name and is then taken to market through distributors.

How quickly can Affimer antigens be mass produced?

Okay. So Affimer molecules or an Affimer antigen -- so Affimer molecules are very straightforward to manufacture actually, which is another one of the key benefits. And if we think about the volume of manufactured required in the near term, we can manage that ourselves. So we can produce sufficient material because, of course, a very small amount of material goes into each test. But given the sort of capacity volume rather that we're expecting, we would outsource that to a CMO, contract manufacturing organization fairly quickly. And just to sort of follow on from that, we've done that before, and the tech transfer to do that is pretty straightforward because these are well -- they're not difficult to manufacture. So getting a CMO to make them in even higher quantities is not a particular challenge.

It's now 6 o'clock. So we've probably got time for one more question. Do you anticipate any further share placings before the human trials are complete?

No, I don't. We don't have any intention to raise further capital. I mean clearly, we have capital through to '22, as Tony described. We have a huge number of opportunities that we really just need to focus on and deliver. And I think that delivery will be reflected in the value of the company. So no intention, no plan for raising capital, just really nose to the grindstone.

I think we've reached the 6:00 cutoff. Thank you both very much, and thanks, everyone, for submitting their questions. Alastair, I'll turn back to you for any final remarks.

Okay. Well, not really, just to thank everyone for their time. And I genuinely look forward to updating you on the news flow over the coming weeks and months. Thank you very much.