BioVersys AG (BIOV) Earnings Call Transcript & Summary

Good morning. Thank you for joining BioVersys Half Year 2026 Earnings Call. My name is Anca Cighi, and I'm the IR Communications Lead at BioVersys. Before we begin, I would like to refer you to Page 2 of our presentation on forward-looking statements. I would also like to remind you that today's call will be recorded and made available on our website in the Financial Reports section. It is my pleasure to introduce our speakers for today's call. Our CEO, Dr. Marc Gitzinger, will provide introductory remarks and an update on our pipeline progress. Glenn Dale, our CDO , who joins us today remotely as he's conducting sale visits, will talk to you about our clinical trials for BV100 and Alpibectir. Hernan Levett, our CFO, will update you on our financial results, after which we will start the Q&A session. Before we begin some housekeeping topics. [Operator Instructions] Marc, please go ahead.

Thank you, Anca. And welcome, ladies and gentlemen, hearing from me. Thank you for joining our earnings call for the first half year results of 2026. I'm happy to start the presentation with a look to our pipeline. BV100 is our lead asset, which is being developed for severe hospital infections caused by carbapenem-resistant acinetobacter baumannii, the bacterium that causes today mortality rates of up to 50%, which is unacceptably high. Our global Phase III trial RIV-TARGET is actively recruiting since April this year. our Phase IIb RIV-CARE trial for further clinical differentiation is well on its way and will initiate first sites in September. Together with our partner, ADVANCE-ID, first patient first visit is thus expected very soon. As a reminder, commercial rights for this program are pavers and we expect peak sales potential of USD 800 billion. BV100 has the QIDP label from the FDA and was also just granted Fast Track. QIDP also allows for 5 additional years of U.S. market exclusivity. Alpibectir is our second clinical stage pipeline asset. The program is directed against to closes, and we developed it in collaboration with GSK. The program benefits from significant support from nondilutive funding sources, it has already FDA QIDP and the orphan drug status as much from the FDA as also from EMA, and it qualifies for the FDA priority review voucher. We are currently conducting a pulmonary tuberculosis Phase IIb/c trial and are in the process of starting a Phase II in TB meningitis. For completion, our preclinical pipeline consists of BV200, which is a small molecule that prevents staph aureus from producing toxins, and we focused this program first on a topical application in atopic dermatitis. BV500 is directed against non-tuberculosis mycobacterial infections, which affect mainly chronic lung diseases such as cystic fibrosis and COPD, and we developed this in partnership with Shionogi. And this leads me directly to our highlights of the first half of 2026. We have been able to execute on our strategy and progress the entire pipeline and entered an additional new partnership. We have made a lot of progress, particularly in our clinical stage assets. The highlights for BV100 are that we reported the first patient first visit for the first global Phase III trial called RIV-TARGET of averse. This trial is actively recruiting since April. Our first Drug Safety Monitoring Board, DSMB, is scheduled for the second half of 2026. We also got Fast Track granted by the U.S. FDA and agreed on our initial pediatric study plan with the FDA. In terms of additional Phase I studies, we completed a small drug-drug interaction study looking at BV100 and the low-dose Polymyxin B, and we finalized our Phase I trial in China. The latter allowed us to move into the regulatory process to bring China onboard into our RIV-TARGET trial, which we expect now to enroll first patient in China in March '27. For RIV-CARE, our open-label Phase IIb trial for clinical differentiation, we progressed well with the regulatory work together with our partner, ADVANCE-ID.. We are initiating first sites and are expecting first patient first visit very soon. The trial is, as you know, supported by Wellcome. Besides this, we published our Phase I safety and PK in Antimicrobial Agents in Chemotherapy, a renowned journal, and presented additional preclinical data at the European Clinical Microbiology conference called ESCMID. For Alpibectir, which we developed together with our partner, GSK, we -- in the pulmonary tuberculosis, the Phase IIa ENABLE trial, assessing for the first time AlpE, so Alpibectir–-Ethionamide, in combination with the first line to tuberculosis drugs for 2 weeks was completed. The results warranted imminent progression into STEP2C, as we reported, and we reported also first patient first visit in March. This trial runs within the UNITE4TB platform, an EU-funded program. Detailed results from ENABLE will be presented by our partner GSK at the prestigious Union Conference in November. The Phase II trial in TB meningitis completed all regulatory submissions, and we expect first patient first visit in the second half of 2026. We received orphan designation also from the EMA for AlpE Alpibectir–-Ethionamide to treat tugocilosis, and we published our Phase IIa early bactericidal activity data in the prestigious New England Journal of Medicine and additional preclinical work around the mode of action in Nature Communications. On the corporate side, we were able to expand our capabilities and access to [ enzymycin ] chemistry by a new collaboration and license agreement with the Hackensack Meridian Health Institute. And our ongoing pharma partnerships with GSK and Shionogi progressed well. Aside from this, on the policy side, a very positive development was the inclusion of so-called transferable exclusivity vouchers into the EU pharma legislation. I will speak about this in a bit more detail on the next slide. Our CFO, Hernan Levett, will give you later a detailed overview on our finances. But we remain well funded into 2028 and could improve our guidance for 2026. Now this slide comes originally from the BEAM Alliance and represents a summary of the ongoing policy changes around the reimbursement for new priority antibiotics and AMR products in general. I would like to give you a brief rundown on these important and positive developments for the antibiotic market and thus also for BioVersys. In the upper half of the slide, you see the countries that have already implemented policy changes around the reimbursement of antibiotics. Of course, the U.K. remains the landmark country, being the first country that introduced the so-called subscription models, meaning a new antibiotic gets categorized on a set of fixed criteria and can receive up to GBP 24 million annually for the time of up to 16 years. This is a volume independent fixed fee that does not require a company to actively market the drug in the U.K. Germany and Italy, in contrast, have established what we call a high-price system. And Sweden created a revenue guarantee that is currently mainly targeted towards generic antibiotics but is in discussion to be increased for innovative drugs. The biggest change to date is coming from Brussels. The EU decided to trial so-called Transferable Exclusivity Vouchers, TEVs. And that means if a novel priority antibiotic is eligible to receive a voucher, the recipient can either decide to keep it for its own pipeline or sell it onwards to a large pharma company. So far, it resembles does the priority review vouchers of the FDA. However, the TEV vouchers allow to extend the data exclusivity of the drug by 12 months for the EU market, thus delaying generic entry by 12 months. There are some restrictions in guardrails that applied to the voucher. So the current estimated value of these vouchers lies somewhere between EUR 150 million and EUR 300 million. It is currently planned that the voucher system is implemented before year-end of 2026. Aside from the vouchers, the EU asked member states to complement the TEVs with local and regional subscription models resembling the U.K. model. We hear currently actively from several countries being in discussion around this. Lastly, the PASTEUR Act in the U.S. has been reintroduced to the U.S. Congress. It is now, of course, the fourth addition already and still has strong bipartisan support. The update for the act has been mainly around the benefit into the existing health frameworks in the U.S., but the main body of allowing annual subscription fees between USD 75 million and USD 300 million per priority antibiotic for up to 10 years in the U.S. remained exactly intact. Overall, we are pleased to see increased momentum and action on these much needed policy changes that assign an adequate value to critical novel antibiotics addressing priority health threats and incentivizing innovative AMR companies. While our current business plan does not rely on such incentives, it could add significant upside in the future. And with this, I'm happy to hand the presentation to our CDO, Glenn, who will provide you more details on the progress of our clinical assets.

Thanks, Marc. I'm pleased to update you on the progress we are making on our Phase III development program for BV100, which we develop for critically ill patients in the indication of hospital-acquired and ventilator-associated bacterial pneumonia. Just as a brief reminder, the progression of BV100 into Phase III development comes on the back of our strong Phase II data and ventilator-associated pneumonia, in which we could show a relative reduction of all-cause mortality of over 50% versus the best available therapy. In this trial, we also saw Acinetobacter strains that were not susceptible to Cefiderocol and Xacduro, the newest drugs, which represent the newest drugs with reported activity against Acinetobacter. But most importantly, all 5 patients that were affected by these strains in the BV100 study arm had a favorable outcome. So coming now to our current work. RIV-TARGET aims to seek at the initial regulatory approval with the main global regulatory bodies, the FDA, the EMA and the China NMPA, which will follow up very quickly afterwards with broad global access. The trial is designed as a noninferiority trial where we do have a test for superiority. Besides RIV-TARGET, which is designated for regulatory approval, we also run a trial that supports the real-world evidence in regions with extensively drug-resistant patient populations. And this will support the initial commercial uptake of BV100. This is our Phase IIb RIV-CARE trial, and we will assess additional background therapies and would be randomized to best available therapy, including the newest available drugs for carbapenem-resistant Acinetobacter. In a competitive process, RIV-CARE was selected by Advance-ID to be conducted within their trial network, which is financially backed by the Wellcome. This allows BioVersys to offset a large portion of the budgeted trial costs for this trial. So regarding the progress and outlook for RIV-TARGET and RIV-CARE, I'm happy to report that RIV-TARGET is actively recruiting, and we are pleased with the progress. We have already activated more than 50% of the countries, and over 1/3 of the sites are actively recruiting. RIV-TARGET is progressing well. We expect the first drug safety monitoring board is planned for the Q4 of 2026. And as mentioned by Marc, we also recently agreed with the FDA on our initial pediatric study plan and received Fast Track designation. Our overall target remains unchanged for RIV-TARGET, the guidance and enrollment of the last patient is anticipated for the end of 2027, meaning that we should still be on time for the first submissions for regulatory approval by mid-2028. For RIV-CARE, we will initiate the first sites together with our partner, ADVANCE-ID in September of this year, and we expect shortly thereafter the first patient first visit. We updated our guidance for the first interim readout to H1 2027 as we would like to see a meaningful number of patients enrolled to give some strength to the data. Guidance for the last patient in remote enrolled remains for the end of 2027. The current Phase II trials are focusing around the identification of ideal regimens. Next slide, please. So with Alpibectir, the current Phase II trials are focusing around the identification of ideal regimens that will lead to improving patient outcomes in tuberculosis. So let me start with the development in pulmonary tuberculosis. Based on the robust data from our Phase IIa EBA study, so early bactericidal activity study, which we published earlier this year in the New England Journal of Medicine; we conducted with our partner, GSK, and within the framework of the EU IHI-funded program, UNITE4TB, another Phase IIa with Alpibectir tested for the first time in combination with first-line tuberculosis drugs. This study was called ENABLE. Earlier this year, we reported that Alpibectir was safe and well tolerated in this study and could seamlessly progress onto the next trial, which is a Phase IIb called STEP2C. Step 2C reported first patient first visit in March of 2026. And more detailed data for the ENABLE trial will be presented by GSK at the prestigious Union Conference in November this year in Rio de Janeiro. For the Phase IIb meningitis trial, we run this trial together with an academic consortium led by the University of Bordeaux. And we made very good progress in the regulatory process to conduct the trial in Zambia, Ivory Coast and Madagascar. We now expect the first patient first visit in Q4 of this year. And just as a reminder, [indiscernible] has received orphan drug designation from the U.S. FDA and the EMA and is also eligible for an FDA priority review voucher. And with this, I would like to hand the presentation over to our CFO, Hernan Levett, who will guide you through the financial results.

Thank you, Glenn. Good afternoon, good morning, everybody. Our focus during the first half of the year was really to center on execution. This was marked by the successful initiation of pivotal Phase III RIV-TARGET trial for BV100, where we enrolled the first patient in April of 2026. The cash position at the end of the first half of 2026 was CHF 69.3 million. and we continue to drive the business with a lot of emphasis on financial discipline. R&D represented 82% of our total expenditure. We have identified a number of efficiencies, and we have added several key positions to our staff, primarily to support our development team while still keeping a lean organization at 38 FTEs. So all in all, we're really excited about the progress we made during the first half of the year. reassuring us that we're on the right path to deliver on our pipeline, particularly for BV100 with significant catalysts ahead. Now looking at our financial statements, the net loss for the period was CHF 15.6 million compared to CHF 11 million for the same period of 2025, with the following breakdown: an increase in operating income of CHF 2 million, mainly driven by higher tax research credits; R&D expenses of CHF 13.6 million, which is an increase of CHF 3.6 million compared to the same period of 2025, which is, of course, expected given the -- that we have started with our Phase III activities; G&A, CHF 3 million, which is a decrease of CHF 700,000 compared to the same period of last year. And last but not least, financial results resulted in an expense of CHF 1 million, which is a decrease of CHF 600,000 compared to the same period of 2025. Moving on to the statement of financial operations, our financial position for the period ended June 30, 2026, shows that the shareholder equity was CHF 44.8 million, of which the total assets amounted to CHF 76.9 million, of which cash and cash equivalents was CHF 69.3 million. And we also have the prepayment and other receivable position of CHF 6.7 million. The total liabilities for the period was CHF 32.1 million, which is an increase of CHF 1.3 million compared to the same period of 2025. Of course, this is mainly driven by accrued expenses related to our R&D activities and the increased fair value of the warrants. Cash and cash equivalents at the end of June, as I said before, it was CHF 69.3 million as a result primarily of outflows from operating activities, which was CHF 13 million. In terms of the financial outlook for 2026, we have improved our guidance for the operating loss, which we expect to be in the range of CHF 32 million to CHF 34 million, driven by higher revenue and other income of CHF [ 0.5 ]million. G&A and other project cost efficiencies that we have identified for CHF 1 million, lower pass-through costs of CHF 3.3 million for -- primarily for RIV-TARGET trial and a phasing effect of CHF 3.1 million, mainly related to logistics and country and site start-up of the RIV-TARGET trial. Regarding our cash guidance for the end of the year, we expect an improvement of CHF 10 million compared to our March guidance. which will lead to a cash and cash equivalent position of CHF 53 million as a result of the efficiencies and a phasing previously described. And I would also like to point out to the prepaid expenses and other receivable line of our balance sheet mentioned before, which also includes an additional [ CHF ] 3.1 million of prepayments already made to our CRO. So all in all, we're in good shape, and we continue to reaffirm our guidance that the company is financed in its operations into 2028. We continue, of course, to pursue nondiluted funding opportunities across our pipeline, and we will keep you appraised of any new developments in this sense. In terms of business development, we will continue our efforts to explore partnership opportunities and we will update you as we make progress on this front as well. We are planning to have a release of our full year 2026 financial statements around mid-March 2027. And again, we will keep you appraised of any new developments. And with this, I'll turn over the call back to Marc for the final closing remarks.

Thanks, Hernan. With this, I'm happy to summarize today's call. Overall, BioVersys made great progress in the first half of 2026, and we continue to execute on our strategy while maintaining financial discipline. The main achievements in the first half were actually the Fast Track designation of BV100 by the U.S. FDA. Of course, that RIV-TARGET is actively recruiting. Besides that, we completed 2 additional Phase I studies on the one hand, the bridging study for China. And on the other hand, a small drug-drug interaction study for BV100 in combination with low-dose Polymyxin. The BV100 RIV-CARE trial is also initiating first sites in this month as we speak. And this is together with collaboration with our partners at Advance-ID and of course, the significant co-funding from the Wellcome. Alpibectir Phase IIbs for pulmonary tuberculosis reported the first patient first visit in April. This is led by GSK. And on the corporate side, we were able to published in very prestigious medicinal journals, our data. We also presented again at the most important conference around our field, which is the ESCMID. And we have a new exclusive Ansamycin collaboration on our research pipeline with the license agreement with the Hackensack Meridian Health. In terms of the near-term catalysts, BV100 RIV-TARGET, the Phase III, we will -- or we're expecting our first safety monitoring board. Then in RIV-CARE, we expect, of course, first patient first visit. And then after that, the interim data readout. And for the Alpibectir TB meningitis Phase II trial, we also expect first patient first visit. As Hernan already mentioned, we have always continued efforts ongoing to intact nondilutive funding and potential partnerships. And with this, I would like to thank our team for the massive efforts that they put into progressing our pipeline so diligently and thus putting us in a place to impact patients' lives and create shareholder value. Thank you for joining the call today, and I'm happy to take the Q&A.

We have a first question from [indiscernible] from UBS. Please go ahead.

It's [indiscernible] from UBS. So the top line readout for the Phase III BV100 has been pushed back from H2 2027 to early 2028. Could you provide us a reason for this delay, please?

Yes. Thank you for the question. So overall, we are really happy with the progress on how we continue to add value to our pipeline. And I think our team has managed to get our first global Phase III trial up and running without any major hiccups or time shifts, particularly considering the complexity of an intensive care unit trial that is run in so many jurisdictions around the world and not all of those are normally main trial countries. Our guidance remains to finalize the recruitment at the end '27. And until we have the top line data in hand, it will be early 2028. Mostly, these small hiccups were related to what Hernan already said, logistical issues that come from drug supply, for instance, customs, et cetera, to get the drug on site and the different -- all the assessment kits, et cetera. So none of these hiccups were anyway related to regulatory process per se or design shifts or anything. So I think overall, we feel that we executed very well on getting this trial off the ground, and we see this also currently, as Glenn reported, in the recruitment pickup.

Thank you very much, Marc. We take our next question from around from [indiscernible]. Please go ahead.

I was wondering if you could please comment a little further on the availability of these vouchers that you talked about previously during your prepared remarks, Marc. And if you could perhaps give us a sense of what you expect the anticipated value of these vouchers to be from the European side. Obviously, we are all familiar with how priority review vouchers are typically sold and resold in the United States and the fact that the last few transactions have occurred at a level of at or above 200 million a piece. But just wanted to see what your take was on the relative value of the European vouchers. And also if you anticipate that this will be a potential meaningful source of nondilutive capital for BioVersys in the future.

Thank you, [ Ram ]. Yes, I'm happy to give a little bit more flavor on what we know today. I think the first and most important information is really that this is set in the pharma legislation. So these vouchers are coming, and there's no doubt about that anymore. The ambition -- or ambitious time line that the EU has set forward on this is actually, they are the earliest piece of the EU pharma legislation to be implemented and the expectation is end of this year. which a lot of the stakeholders involved are really working against that timeline. The next step that we anticipate is that probably this month, latest in October, we expect a first set of eligibility criteria and get a bit more flavor around which kind of products should receive a voucher. Of course, the whole incentive plan is guided around priority antibiotics. So we feel that BV100 should be in a good position there. In terms of the value of the vouchers, we gave the range anywhere between EUR 150 million and EUR 300 million. Of course, that's still a rather broad range, but we'll have to see how the guardrails will really affect this. So there is a few guardrails that the user of such a voucher can only deploy it to a drug that has not made more turnaround, I think, than EUR 500 million in the first 4 years or in the fourth year after launch in Europe, et cetera. So it's quite complex, all of these details around. And that's why the range is still pretty big. But since -- on the other hand, the positive note is that the voucher allows the company that deploys it really to plan quite concretely because it comes at the end of the life cycle of a product rather than the priority review voucher really -- yes, it's very early even before you know if the drug gets approved. So here you know pretty much what to expect from your drug and how important it is to keep generic competition out for another 12 months in terms of the data exclusivity. So we feel that long story short, what we see was the priority review voucher is around 200 million. I think it's fair to assume that somewhere around that, the transferable exclusivity vouchers from Europe should land in a similar space.

And then just very briefly, can you comment on the total number of clinical sites that you expect to be involved in RIV-CARE at steady state?

Yes, we expect roughly 25 to 30 sites for the RIV-CARE trial in [ 4 to 5 ] different counties yes.

Our next question is from Clemence from Stifel.

I have two on data to come, if I may. Could you remind us what you expect to see in the RIV-CARE interim? Will it include mortality, clinical pure-only safety? And in the same vein, what new information will the November ENABLE presentation provide relative to what we've already had so far?

Thank you. All the information that we collect in the trial is very similar to what we collected already in our Phase II trial and in -- even in the Phase III RIV-TARGET trial now. Of course, the primary topics will be around safety. It adds to our safety database as well. But we will look at all-cause mortality and benefits also at the microbiological cure rates, et cetera. So we do expect in the end, fairly similar readouts like we had in our original Phase II in ventilator-associated pneumonia. And then the second question, well, I can't preempt everything that our partner, GSK, will say at the Union Conference. But bottom line is, so far, we reported on the safety, et cetera, but we will see a more detailed efficacy data as well. That's what we expect to see at the presentation of the Union Conference for the tuberculosis ENABLE trial.

We will take our next question [indiscernible].

Two, if I may, please. So first on funding, you confirmed your previous guidance of funding into 2028. So I was wondering, does that specifically still cover the planned BV100 submission? And then on -- further on funding, you mentioned nondilutive funding options and strategic partnerships that you're exploring. Now in terms of partnering, is that commercial partners or development partners or both? And then maybe just the last one, coming back to the timelines that my colleague has mentioned. Previously, also for the RIV-CARE trial, the data readout seems to have changed slightly. Just trying to understand the risk of further delays here. So you mentioned that it's more organizational issues. But would you say that's sort of sorted by now or any risk that we might face further delays?

Thanks for the question, [ Jonas ]. Look, I think, yes, the guidance regarding the financing, the runway in the catalyst remains unchanged. You've seen, hopefully, with the waterfall that we presented today really the sources of why we have upgraded our guidance. And that's why I mentioned that we see a -- you need to consider the 53 million that we see at year-end plus already the position we have in the balance sheet as prepayments that we have made to the CRO. So we remain very confident on that guidance. In terms of partnership opportunities yes, I think it's primarily related to commercial partners for -- particularly for geographical expansion into China. We still are actively working on that. Again, it's a larger project, right? It takes a little bit of time to identify the right party, and we're making progress towards that. So yes. And as discussed, we will continue -- you know that our programs had a lot of support for nondiluted funding. We're working through a number of opportunities and costs that may continue to crop up. We're scanning through those. We have an active process and team behind that. And so we will continue to pursue those opportunities. With regards to the issues, I think that the -- that's why we're super happy about what we have accomplished during the first half. A lot of these things, when you start these complex trials, you have a design and then you have a number of technicalities that you have to overcome. And we have now put that behind us. And this is why now we're tracking clearly towards the goal that we have, which is to finish the trial with the last patient in 2027. At the moment, it's too early to say, and we want to be a little bit cautious here. We have, on the one hand, the way that we have initiated sites and countries that gives us one piece of the information. But then we also have positive signals from the countries that are actually recruiting compared to the rate that we have designed with CRO. So at the moment, it's too early to tell. What we want to see is more countries actively recruiting. And based on that, we can then clearly have a trend analysis performed. So I think you should expect that we can give further information later down the road when we have the full year 2026 financial earnings call. Marc, I don't know if you want to add to that,

Yes, just concretely, you was also on the RIV-CARE trial. The issues were pretty much the same. It's a lot of logistics with all of these drugs being carried to the different countries, all the customers. It's not only our study drug its, we have to provide all antibiotics for the trial in RIV-CARE, this is even one challenge above because you see the different background therapies that we give. These are really logistical issues that not so easy to anticipate. All of this is left behind us. together with our partner, Advance-ID, which on the one hand, adds an additional layer of complexity because it's an additional partner in the whole process. On the other hand, they're doing a fantastic job pushing this also forward. They have really good contacts to the sites because it is a clinical trial network. So I guess, honestly, we have to see now how the initiation and the recruitment picks up there. But mind you, we are, again, in countries with extremely high prevalence of these infections. So we're really optimistic that these minor topics are really left behind us now, and we can go full speed ahead.