Bio-Gene Technology Limited ($BGT)

Thanks for standing by, and welcome to the Bio-Gene Technology Investor Update Webinar and Q&A for June 2026. [Operator Instructions] And note the session is being recorded. On behalf of Bio-Gene today, we have the CEO and Managing Director, Tim Grogan, and I'll hand it over to him now.

Thanks very much, Matt, and good morning, everybody, and thanks for attending today for the webinar update on the back of our recent placement and launch of the securities purchase plan. It's a great opportunity to give everybody an update on recent progress. And since beginning of February, we've released a large number of announcements and had some pretty significant developments. So I wanted to highlight some of those in the presentation today. Rather than taking you through the detail of every slide, many of you on this call, no doubt will be pretty familiar with the sort of basic background for the company, so that will give me a bit more time to focus on the more interesting elements. So I might just move forward to the next slide, and it's decided not to work for me. There we go. Okay. So a little bit of background there for those not familiar on our basic assets, Qcide and Flavocide and the vertical markets that we're focused on, the sizes and the number of partnerships we've entered into already. Background context is getting stronger in terms of pressure from mosquito-borne viruses, diseases and other issues associated with malaria, dengue in the region. We also are seeing an increase in the cost of food and the pressure from pests is a major factor in the input for the cost side and the relevance of insect control is becoming more obvious as we deal with growing world population and less arable land. So the background here is you'll see in the top right corner is a picture of us harvesting Qcide, our 100% natural product. We do that every 7 months from the plantation about 2 hours west, southwest from Cairns, and we finished our 15th harvest. And Qcide, being 100% natural, is the product that we've announced we're going to launch later this year in Japan with Sumitomo Corporation and a company called Nakashima, and I'll talk more in detail about that in a moment. Flavocide, on the other hand, is produced synthetically, but it's identical to the natural version that also is present in these plants, and we're undertaking the significant regulatory development and safety studies to be able to file our first regulatory submission for Flavocide in Australia with the APVMA, the Australian regulator in March, April next year. So we've got some really significant developments happening within the company and the context around the recent placement and the current securities purchase plan really feeds directly into our ability to execute on those significant upcoming milestones. We've included in here a little bit of efficacy data just showing examples of, in this case, Flavocide and its activity against a number of different types of mosquitoes showing 100% mortality. And we haven't previously published a lot of this kind of data only because some people's eyes glaze over, but nonetheless, there's obviously a lot of efficacy data supporting the development of Flavocide and Qcide. We also have included in this slide deck some efficacy data showing activity against a number of different types of ants and cockroaches. And we've got a lot of data associated with various bugs in the grain storage area and bedbugs. And in the main, think about the relevance of Flavocide and Qcide, flying and crawling insects and the very large categories of opportunity for us. So this slide is really quite important, and I'd like to dwell on what this really means. So this is looking at the development -- regulatory development pathway for Flavocide leading up to the first regulatory submission with the APVMA in back end of Q1, early Q2 next year. So this chart is showing in green the studies that are completed. In yellow are the studies that are currently underway and the blue studies are those that we're anticipating commencing in the very, very near future. So the regulatory development pathway for Flavocide is not unusual. Fortunately, we're the beneficiaries of a system that the OECD has developed as a standard protocol package that enables the assessment of safety of a new insecticidal agent. And it means that the protocol development stage and the risk associated with that is not a feature of the area in which we're operating. So the regulators are primarily interested in mammalian safety and also in the manufacturability and manufacturability relates to consistent specification, characterization of any impurities and having the analytical methods to ensure that you really understand what's in each batch. So batch-to-batch reproducibility is particularly important. And this regulatory path that we're focused on, the first one is really directed at the use of Flavocide in this case as an active ingredient in insecticidal products that are used against vectors of control, public health applications and outdoor use, but not on food crops. And the reason for that is the application of insecticides on food crops requires the generation of residue data, and that just takes a little bit more time. It's something that certainly we're planning to do on the back of this first application. So the -- in terms of upcoming news flow, we would anticipate getting the data from the second of those yellow studies, the OECD 424, which is neurotoxicity study and the 443, which is a one-gen reproductive toxicology study, and they'll report later in this month and in September. So really quite significant in terms of news flow because those 2 studies involve the longest exposure period to Flavocide. The blue studies are relatively short and will be run together as a chance that one of those may not be required. But nonetheless, all of those would run simultaneously at this point and lead up to the first filing with the Australian regulator. One of the really important aspects for this system is that the technical assessment that's undertaken in Australia is then, if you like, referred to by a number of regulatory bodies in the region, Singapore, Malaysia and other places. So the assessment here then translates into quite a quick application and approval process in a number of international jurisdictions. So once that dossier is submitted, there's been a review period in Australia. It's not possible for us to estimate accurately exactly how long that will take. That's entirely in the hands of the regulator. They do have a mandated 18 months maximum legislated period. And obviously, we would anticipate being able to be assessed much faster than that. But it's a function of their workload. Fortunately, this data pack is relatively straightforward. And in addition to that, we're dealing with a compound that's identical to the natural version. So not introducing a lot of complexity in terms of new chemical entities in that regard. And on the back of submission in Australia, we have the opportunity to generate some ecotoxicology and environmental fate data and be able to use the same data in our submission to the EPA in the U.S. and other regulatory bodies, Brazil and other locations. So we'll be making various announcements relating to our progression through this, but the upcoming announcements around the neurotox 424 and the one-gen reproductive tox 443 will obviously be news to look forward to. So I just wanted to very briefly for those of you that are interested in our commercial model, we innovate and partner with commercial licensees. They're typically manufacturers, and they typically undertake formulation development and the regulatory pack for the formulated product and also manufacture and supply through to the wholesalers. In return for that, what we typically do is enter into commercial development licensing agreements involving upfront milestone and royalty payments and each of these is a separate negotiation, obviously, and the royalty rates obviously vary depending on the target geography and the market and the dynamics -- commercial dynamics at play. But in addition to that, we also have the opportunity to generate revenue from the margin on the supply of the active ingredient itself because we undertake that, manage that process ourselves and with our commercial partners supply that through. So it's a pretty clean model, and we've been able to implement that successfully with 2 of our partnerships. There's a couple of slides here that break out the market size and the verticals we're focused on and the size of the market is increasing quite substantially over time. And we also have -- helps you to place our partnering arrangements. We have Clarke Mosquito Control in the U.S., and we're working with Envu, which was part of Bayer's Professional Pest Management Group. So this is focused on the vector control category. And beyond that, we're obviously working in consumer, the agricultural grain storage and animal health. We're looking for a commercial partner in the grain storage area. At the moment, we've got some really good data in that area. And obviously, got several partners in the consumer space, working with Evergreen Garden Care in Europe, U.K., Australia and New Zealand and recently announced the opportunity in Japan with Sumitomo Corporation and Nakashima. So -- the -- just very briefly, for those that you may recall, we've got 2 U.S. Department of Defense grants, and this was really quite a significant development for us because we were successful in securing 2 grants in the same round. So this is $3 million over 3 years, and both of these programs are going very well, one of which is Flavocide is a wearable device that emanates Flavocide passively to kill mosquitoes. And the key point there is you have a device that is well suited to the application of the active in that environment. And the second project is a Qcide-based product formulated for use in cracks and premises against bedbugs. And that's obviously a very -- unfortunately, a growing opportunity for us. So just very briefly, I wanted to highlight a couple of the recent announcements around the organic listing of Qcide. First of all, in the U.S. And OMRI, the OMRI listing is the gold standard internationally for organic listing and the use of imports into organic production systems. And the steam distillation process, 100% natural production system for extraction of Qcide was made this process very, very easy for us. We've also, this year, had a number of quite detailed announcements, giving shareholders a lot of information about the development of Flavocide and the protocols and endpoints that we'll be reporting on in due course. And finally, in Japan. So the Flavocide development path being fully regulated and one that we're investing in very carefully, we also wanted to execute an early path to market for Qcide. And Qcide is 100% natural pedigree opens up a number of interesting opportunities in certain territories. And it turned out that in Japan, the system there is such that if you want to launch a product such as Qcide in the market and you have supporting safety and efficacy data to support the label claims. It's a very simple process. You're not required to go through the regulatory review period. It's a [indiscernible] path it's called. And -- the formulated product will then be basically developed through our commercial partners with Sumitomo Corporation and Nakashima. And the plan is to initially launch this in a ready-to-use container. You can see an example of that sort of product format in the bottom right and to launch it initially online for use in the household nuisance insect pest category. So it's around the home, but not use on plants or food crops and not on vectors of disease. Each of those separate categories are regulated by Department of Agriculture and Department of Health. And Nakashima have a lot of experience in this category and Mr. Nakashima from that company has been supplying products for over 20 years in this category. And he's -- he summed it up very well by talking about a pedigree of Qcide being 100% natural Australian eucalypt-based product with a new mode of action, patent protected and organic certification. And that really is an outstanding combination for the household nuisance pest category in Japan. And beyond the online sales initially, the plan is to then move into the large hardware stores, of which there are around 4,000 in Japan and beyond that into around about 2,000 of the big pharmacy chains like Walgreens in the U.S. So the initial revenue is expected in Q3 from the supply of our first shipments of Qcide for formulation in Japan and then first online sales and launch in Q4. So you can anticipate quite a lot of news flow associated with that program. And the practical challenge for us is to scale up the production of Qcide. This plant behind us to produce enough Qcide oil to meet the needs. And it's actually possible that we may be able to execute this type of early to market strategy in other territories as well. And that's certainly of interest to us as long as we can produce enough Qcide. It's around about 18 months from seed germination to first oil offtake from the plants. And obviously, we'd like to move into that category very, very quickly. So that gives you a little bit of a summary of the Japanese opportunity. And looking forward, then we have quite a bit of news flow coming up. So as I mentioned, we've got the neurotox data. We've got finalization of the agreement with -- in Japan with Sumitomo and Nakashima, and we're involved in the negotiation around price and various other aspects at the moment. And then we'll have the one-gen reproductive tox data. We'll have first supply in Q3 through to Japan with [indiscernible] first revenue and then product launch and then the APVMA filing for Flavocide in around March, April next year. So it's going to be a busy period for us. The presentation also includes a couple of slides, just updating shareholders on a range of licensing and collaboration deals in the first instance related to this biological category. We're seeing continued interest from the major agchem companies looking at biological products and updating their product portfolios away from the synthetic chemistry-based categories that obviously are getting more complex and more pushback from regulators and consumers. And the next slide deals with the acquisitions that have been happening in recent years in this category and Sumitomo and others are very active in this space. So there's the usual background here on Bio-Gene. So Matt, I'm very happy to take any questions.

Thanks, Tim. [Operator Instructions] Tim, the first question I have is in the March announcement on the Sumitomo collaboration, it stated that the definitive agreement is expected by late April, early May 2026. Can the company update the outlook for the definitive agreement?

Sure. Yes. So as I mentioned earlier, we're obviously working on that at the moment. And as you'd appreciate, there are quite a few elements to that, pricing and supply terms. Basically, we have planned a supply agreement and a commercial license arrangement. And obviously, we're keen to get that finalized, and we'll make an announcement in due course.

And the next question is, can the company elaborate on the licensing structure being considered as an indicative upfront milestone royalty model and an order of magnitude, total addressable market for the Japanese household nuisance pest market?

Yes, sure. Unfortunately, as with a lot of things we do, we're not -- we're constrained by confidentiality and we can't -- I can't talk specifically about the agreement in Japan in any way at this point until we make announcements with our partners' consent. However, the broad picture for us is that, as I said earlier, we focus on this recipe of upfront milestone and royalty payments and a margin on the supply of the active. And each of those is a separate negotiation. There may be reasons why we can implement a system such as that or modify it slightly. And if we're able to share details of that, we will. And in terms of the size of the market opportunity, in Japan, the household insecticide market is around about $1 billion. And -- and the nuisance insect pest category is a pretty major component of that. So yes, it's a large market opportunity for us.

You touched on it a little bit during the presentation, but can you just provide a bit of commentary around the runway that the cash injection provides from the capital raise?

Sure. Yes. So recently announced the results of the placement and a partially underwritten securities purchase plan. And at the moment, that looks like we'll end up with just under $3.3 million. And that when we take into account the use of planned use of proceeds around the regulatory development of Flavocide and associated studies and a number of other opportunities for Flavocide, scale-up of Qcide and executing on that early to market strategy, a number of strategic projects and partnered projects and obviously, working capital and cost of the raise, we see the proceeds taking us through to late next year. And we may be able to extend that slightly further depending on the final composition of the studies required for Flavocide. And obviously, what we always do is leverage that with the R&D tax rebate and other opportunities and grants. In fact, we've applied for a recent pretty significant grant opportunity. So yes, think of it late 2027, and it coincides with exercise expiry for the attaching options in this raise of 15 October 2027.

Another question that's come through just around share price. I know that's obviously a hard one always to know exactly what's going on. But why has the share price fallen so sharply in the last couple of weeks? Is it around selling prompted by the news of the share purchase plan?

Look, I can't really comment on the share price. It's obviously a function of many factors. There's been no additional news flow relating to the business, and it's just -- it's a market dynamic that I can't really comment on.

And obviously, investors are always keen to know on news flow, Tim. So just in terms of sort of milestones to look forward to over the rest of the year and going forward, can you just elaborate on that?

Sure. So just to run through those ones that I mentioned earlier. So we have the upcoming neurotox data, the 424 study, and we'll receive the preliminary report for that quite soon, hopefully, later this month. And then we'll have finalization of the Sumitomo, Nakashima arrangement in Japan. Then we'll have the 443 one-gen reproductive tox data in rats around September. That's anticipated. First sale of Qcide in Q3 for supply and formulation in Japan and product launch and first product revenue from online sales in Q4. And then the last one is the APVMA regulatory submission in around March, April next year. And there will obviously be other announcements and other achievements over the period, but they're the major components that make up the forward news flow at the moment.

Thanks, Tim. There's no further questions. So I'll just throw it back to you to provide a concluding comment.

Sure. Well, look, there's obviously been a lot happening and having launched the securities purchase plan earlier this week, it's an opportunity for our current shareholders to participate in this raising and to pick up an attaching option -- on 1 option for 2 share basis exercisable in mid-October 2027. I think for those of you that have been on the journey for quite a while, the interesting evolution of Bio-Gene is that we're now nearly there in terms of the regulatory submission and the first data pack that enables the window into product launch. And that's certainly been a long journey since the company IPO-ed in November 2017. I've been with the company for about 2.5 years. And even that seems like a long time. So for those of you who have been involved since 2027 (sic) [ 2017 ], I'd encourage you to realize it's about to get exciting. And on top of that, the launch in Japan and early to market early revenue is very exciting for us. So I really appreciate support of investors for the next stage of Bio-Gene's evolution and growth. Thanks, Matt.

Thanks, Tim, and thanks to everyone for joining.