Biovica International AB (publ) (BIOVICB) Earnings Call Transcript & Summary

Hello, everyone, and welcome to the Biovica Q4 interim report, which is also the year-end for the fiscal year '22/'23. On the agenda -- Oh! Sorry, the presenters today is myself, Anders Rylander, the CEO of the company. We have Anders Moren, CFO; and we have Warren Cresswell, President of Biovica Americas. And what we are going to present you see here on the agenda. I'll give a short introduction about the company and our business go-to-market strategy. We have the highlights for the fourth quarter. Warren will give us a U.S. update, how the U.S. business has been progressing, and I'll cover the European and Pharma services business before Anders gives a financial update, and we will round off with a summary and short question-and-answer session. And you can already now ask your questions in the live event Q&A chat window. If you want to remain anonymous, I recommend you to check that post as unanimous check box that way, when we publish the questions as we answer them, you want to remain anonymous. And before we start asking questions from the chat, we will also have our equity researchers following the company from Redeye, Pareto and Kempen. We will let them into the call to ask questions. And just a short little background about Biovica, our company. It's founded in 2009, and the product and the business idea is based on research performance at Uppsala University during many years. An important milestone for us was the IPO in 2017, and we're now currently being traded at Nasdaq First North Premier. Our headquarter, where we have R&D, research and development and our production facility and our lab to be able to analyze samples is still based in Uppsala but we also have established our headquarter for U.S., including a CLIA-certified lab in San Diego. We have since many years quality management system complying to the ISO 13485 regulatory standard. And when it comes to regulatory labels, we have CE marking for Europe with the IVD standard. And since last year, we have a 510(k) clear product, which enable us to market the product for use of monitoring breast cancer on the U.S. market. And a few words about the product called DiviTum, which stands for dividing tumor and is an indication of what we measure. We measure an enzyme really close related to cell proliferation and as cancer grows through uncontrolled cell proliferation, we can provide very important information to the treating physician and the patient. We've shown in several clinical trials. Today, we have 25 clinical trials that has been performed, peer reviewed and published with some of the leading key opinion leaders and academic institutes in the world, and in those, you can see that our biomarker test, our product, is strongly prognostic for how the cancer disease will develop. We've also shown that we quick -- short into treatment only 2 weeks, we've been able to provide feedback on treatment efficiency if the treatment inhibits cell proliferation as most cancer treatments is intended to do. That's, of course, a very important feedback for the treating physician and the patient, whether to stay on the treatment or to find an alternative treatment for the best possible outcome for the patient. The test is blood-based, so it requires a blood sample from the patient, combined with our test kit, and you get a result that we will perform in U.S. in our own lab and provide feedback to the treating physician and the patient. And this has several advantages compared to the methods -- the standard method being used today, which is image diagnostics where we take a snapshot of the tumor, if it's metastatic because several tumors before start of treatment and during treatment, and it requires several months before you can follow up. And it's also cumbersome when it comes to patient logistics, its invasive, it requires contrast, fluid, et cetera. So having a blood test that blood can be drawn and you can get quick feedback has significant advantages, especially since these treatments, if you take the metastatic breast cancer as the example, where we're active, is priced at over $10,000 per patient a month and have also some pretty significant side effects. So getting this feedback is essential from both patient perspective and health economic perspective. If you look at our commercial road map, which we'll dive into on the coming slides, our initial focus is the use within breast cancer, specifically metastatic breast cancer to monitor those treatments in U.S. and European countries. And with the 510(k) cleared product, we are allowed to launch to market and to use it on -- for patients in the clinical setting to monitor the treatments within the metastatic breast cancer. So we are in the face of building revenues to realize the full potential. And in U.S., we're doing that with our own CLIA lab, our own sales force and supporting functions, which Warren will talk about our strategy there. In Europe, we are benefiting on the assets developed in U.S. and work with partners on each market. We are looking for partners that have the right skill set to be able to basically perform the same activities that we're doing in the U.S. on the different European markets. And other interesting markets going forward is, outside of Europe is the Japanese market and the next areas within breast cancer to expand is the locally advanced area where you see the same type of unmet clinical need that we can meet with this with our product. We also looked into indications outside of breast cancer and identified 3 candidates; melanoma, metastatic malignant melanoma where patients are being treated with checkpoint inhibitors, immunotherapies where we have data together with Karolinska, which looks really promising and strong. So that's a focus area of ours. And we're also looking into non-small cell lung cancer, where we also have data and prostate cancer or large area with an unmet need for better biomarker tests, which we believe we can meet also from the data that we can meet with DiviTum, our product. And finally, the third area, which I'll also cover briefly later on in my presentation is collaborations with Pharma as Pharma has expressed interest for our products and are using it in their development projects, developing new treatments for cancer. And we're looking to expand that and drive that into a more tight collaboration business that will generate new products for Biovica tailored for new treatments from pharma. I'll talk a little bit more about that going forward. So that was a short introduction. No, sorry, we have the Q4 before we go over to U.S. and Warren. So I'll go through the significant events and of course, one very significant event is the establishment of the CLIA lab in San Diego and the last step in that process was to get the certification, so we are allowed to receive samples for clinical use at our lab in San Diego. We have actually already received samples for pharma services as we were allowed with the approvals that we had. This last certification gave us the opportunity to be able to receive also clinical samples. So that's really good. And then we have started to sign commercial agreements. We have 2 commercial partnerships for commercializing the product on different European markets. First of all, Netherlands and Poland with TOROMEDICAL and then also in Italy with IT Health Fusion. After end of the period, that is after 30th of April, we have had -- yes, the first AGM is to launch an incentive program for the U.S. organization that we did in May. And then we have 2 commercial agreements with payers in the U.S., which Warren will talk a little bit about. It's the MediNcrease agreement and the Contigo Health agreement, which also yes, it's really promising and offers a great potential for us going forward. There you go. That was the introduction and the highlights for the last quarter. I will now hand it over to Warren to dive into our U.S. business and go through the different areas that we are working on at the moment and where we are. Well, please, Warren? We can switch...

Thanks Anders, and we are very pleased to report very positive progress in the U.S. If you can advance from the next slide, that would be great. Perfect. So I'm going to be talking about a number of different strategic objectives that we're focusing on. Some of these, you'll notice that are more short-term focused and some of these are long-term focused and the long-term ones really drive this long-term sustainable growth. So these 5 that we're -- that I'm going to talk about over the next few minutes is really around demand generation, client bill contracting, our commercial agreements that have been recently executed, coding and reimbursement progress and also really the impact of our clinical utility. The next slide, please. So we're very disciplined with respect to our customer-facing activities. And as I've indicated previously, we have developed a very sophisticated call plan strategy. And in that strategy, we focused on a number of different things, one of which is our focus on NCI and NCCN-designated cancer centers. We've been successful in regard to engaging all 100% of them, and we have these advanced discussions going on with about 60% of them. We're also focused on non-NCI/NCCN cancer centers. These are very prestigious cancer centers within the U.S., and we have approximately 18 advanced discussions there. Also part of our call plan is we've identified 1,500 high-value medical oncologists across the U.S. And we have been successful in getting front of about 350 of those and having discussions, and we have ongoing discussions with those individuals now. Our call point is really we primarily focus on key opinion leaders and regional thought leaders. These are medical oncologists but also nurse practitioners and physician assistants, they also order -- have the capacity to order DiviTum as well. In our sales process, one of the things that we've picked up immediately is the high level of interest for DiviTum. And when we meet with these clinicians, there's really a process that we walk through, one of which is education, is making sure that, that the healthcare professionals really understand the role of TKa in the cell cycle and also understand the value of DiviTum. As we drive demand for DiviTum, we also work in parallel with the laboratories where those clinicians are based. And that's because what we need to do is we need to put a process in place, ordering process in place. So that sample logistics and ordering is seamless. And so that anybody can order that within their institution, DiviTum within their institution. As that gets in place, then we receive samples, we test to report those samples back. And this has been going fantastically through the U.S. organization. Next slide, please. So one of our primary strategies is executing client bill contracts. And with respect to these contracts, there are contracts with institutions, these institutions are specifically hospitals and does a number of different things. So as I just mentioned before, putting a process in place is really imperative for long-term success for our business. And that's what -- when we put these contracts in place, this is what it really drives is that process within an organization. It provides expanded access within those hospitals but it also guarantees payment for Biovica. So as we sign these client-bill contracts and we receive samples, we actually invoice or bill the institution itself. They then bill the insurance company. So what it does for us is it guarantees payment to Biovica in a very short duration of time. Our efforts are heavy in regard to really building a funnel of contracts. So we're in negotiations and discussions with many, many institutions. We should have our first contract signed in the coming months. And then thereafter, we should see a full of contracts coming after that. Next slide, please. So as part of our private insurance reimbursement strategy, we are focused on executing as well these commercial contracts. And to date, we've been able to do -- we've been able to execute too very quickly. These agreements provide solutions to employers for services performed. And what that means is test performs. So as the test comes in, we run those tests. We report those tests out. When we actually do the invoicing to private insurance, this really helps for providers that are out of network providers. So we fit into that category today because we've recently launched DiviTum as we work with insurance providers, we become contracted, then that helps up the process moving forward. But with these commercial agreements, what we've done is we've prenegotiated rates for our test and this really drives or enables reimbursement for DiviTum prior to being in network with the insurance providers themselves. And the 2 that we've signed, one of which is MediNcrease. MediNcrease is a great partner. They have over 1,000 payers contracted and over 15,000 contracted lives. So it's pretty significant commercial agreement. Contigo Health, on the other hand, they have 900,000-plus providers that they've contracted with. And from a scale perspective, they're probably 5 to 6x -- have 5 to 6x more covered lives than MediNcrease. So these are 2 very important partnerships for us and will really help drive our business moving forward. Next slide, please. With respect to our public insurance reimbursement strategy, we've applied to Medicare for our credentialing. And what that requires is an application process plus it requires on-site visit from CMS. So that has gone well, and we've been able to be credential through Medicare. This enables us to submit Medicare claims through our Medicare administrative contractor, which is Noridian. But what we're also doing is we're applying for our PLA code. And our PLA code stands for a proprietary laboratory analysis code. This is specific to DiviTum and to DiviTum being run in our San Diego laboratory. This process is very well defined through both AMA and CMS. It's really a 2-part system that you apply for, 1 of which is getting the PLA code granted. So we've been working with the AMA to do that. The other is we're working with CMS to establish Medicare pricing moving forward. We should be able to have the PLA code in the next month or 2 and from a pricing perspective later in the year, kind of towards the end of the year is when CMS will issue that. Next slide, please. So my last slide and probably arguably the most important strategic initiative is our focus on our clinical utility. And our real advantage within our business is that we've been building a body of clinical evidence for more than a decade. And this has helped us along a number of different fronts, 1 of which is FDA clearance for our product. Another is it really supports the PLA process, working with the AMA and CMS that really drives the credibility when we meet with clinicians and talk about DiviTum and the utilization of DiviTum with oncologists. And I can't say enough about the strength of this data that we have. What it's also done for us is it's enabled really deep conversations with the oncologists that are doing research as well. So we've had many, many discussions with principal investigators and institutions that want to be able to include DiviTum within their clinical trials. And what that does for us is a couple of things, 1 of which is it strengthens our current intended use, but it also expands our [indiscernible] helps generate data for expansion outside of the metastatic breast cancer as well. So with that being said, I'm going to pass it back to you, Anders.

Thank you. So I'm going to cover Europe and Pharma Services before going into financials. So next slide, we have the 2 contracts that we have signed with the European partners covering 3 territories. And we have had like a requirement specification on partners that we would like to work with. One of them has been that they have success in the past. Another 1 is that they've been active within oncology. The third 1 is that they have a sales force with oncology and are able to reach out to customers and can drive reimbursement and yes, basically go-to-market activities in these countries. And so we are very happy with the 2 partners that we have agreed -- signed agreements with so far in Italy, it's IT Health Fusion, and we have TOROMEDICAL covering Poland and the Netherlands. So going forward, we are now doing activities to establish the product on these markets. We're working with key opinion leaders, having -- our key opinion leaders represented Biovica's keynote speakers, creating awareness and demand, setting up similar processes that Warren talked about for the logistics of receiving a blood sample, performing the analysis and returning the answer and collecting the payment on these markets. Also, we are very happy with these agreements when it comes to the price levels, it's line with or actually a little bit above what we had expected and communicated in the past. So that's for where we are in Europe, and we are looking to continue adding agreements and partners like these, and we're focusing on the big European countries and the Nordic countries. And if you look at the Pharma Services, you can say this is the business that we have been running for the longest time in the commercial settings as we have regulatory approval for research use only, which this falls under, the regulatory agreements are lower and the clinical data that we have published has generated an interest for pharma to use our assay, our product in their development work of new cancer therapies. And the process can be outlined in these steps. The first 1 is that we typically go through a technical evaluation, a smaller project. We call them -- these agreements TESA, Technical Evaluation Services Agreement. They are typically around SEK 100,000 with a successful outcome of such an agreement, we typically enter more close collaboration in a master services agreements, regulating the relationship between us and the pharma company, the customer. And that agreement also covers multiple projects typically. So they're not using it only for 1 project but for an entire pipeline of drug projects could be on different drugs. Our main focus and strength is inhibitors like the CDK4/6 inhibitors in breast cancer, where we have such great data from the metastatic breast cancer area. We see that new reversions, new generation of similar and targeted therapies, attract -- companies developing those attract -- or we have a really attractive product and are used to a great extent within that field. And these products are typically bigger and our ambition is to develop these projects into even closer collaboration, so-called companion diagnostic collaboration where we developed a tailored product, especially for the new therapy, enabling great advantages for the pharma partner as well because then the new therapy will be given together with companion diagnostic test that will enable a more precise treatment or patient selections and the better treatment outcome probably, which will not only increase probability for regulatory success and also being able to more attractive price levels for the pharma. So there's a win-win for us as the pharma. For the diagnostic company, we will get customer funding for developing new products and also can benefit from the marketing investments being made by pharma when launching the product. And then the last step would be the new product regulatory tool out in the market in conjunction -- as product in conjunction with the pharma project. And the status where we are now is that we have developed this area quite significantly since last year. When we end this fiscal year, we had 6 ongoing projects. We today have 17 ongoing projects, 6 of those are these technical evaluation projects or agreements that we expect to convert to a great extent to master services agreement and increase volumes. And we also have 11 ongoing projects of these somewhat more the bigger sort, which is the master services -- that was under Master Services Agreement. So of course, we're getting closer to our goal of entering the first companion diagnostic collaboration project and our long-term goal to have a new product out in about 3 to 4 years from now seems achievable with this development. And we also said that we expect to see a significant revenue increase within this area. It's based on the pipeline that we have developed so far in this area. We, of course, intend to add additional projects to this portfolio. So this area has developed really well. And we can see also the additional clinical data that we have generated and the 510(k) clearance builds trust in customers and attract new customers. And also the outcome from these projects, we have several customers that we now have had for several years that come back and use this for new products. So here's an area we can develop as well. And the next topic is the financial update. So I will switch place and hand over to you, Anders.

Thank you. Some logistical challenges. So thank you, Anders. Regarding the financial update, just a few slides. We'll start with the net revenues. You can see here, we sold for about SEK 3,383,000, which is a 65% increase versus prior year, and this is coming down mainly from the research development collaborations we have with pharma businesses, mainly in the U.S., I would say. You can see here that the net sales for fourth quarter were slightly below what we sold similar time last year, and that's just reflecting the nature of working together with pharma companies developing new drugs, sometimes things happen that you're not in control with. And what happened in Q4 was that 1 of the drug candidates for 1 of our customers failed, which led to a decrease in work orders or canceled work orders for that specific product, and that is reflected then in the slightly lower sales. However, we see a significant higher interest in this. And as Anders pointed out, we had really scaled up the number of contracts and master service agreements. And this is a little bit of a numbers game, the more contracts you have, the more stable the growth will be, and we will attract more and more customers for us. And this is really significant, this increase in interest after the 510(k) clearance that we got last year. A few sentences around cash position and head count. We closed the year with SEK 114 million on our cash balance. We have an average head count in Q4 of 35 people. Last year, the same number was 27. As you can see here, it's flat in Sweden around 22, 23 people, whereas in the U.S., we have added from 4 up to 13 people, which includes the sales force and the reimbursement people working in the U.S. for the commercial launch of DiviTum. So with that, I think, we can hand back to Anders and have a short summary before we open up for Q&A.

Thank you very much. And going to this summary slide and talk about the future milestones. I just mentioned that we have a product, which measure what's really vital within cancer cell proliferation, and we can do that from a simple blood sample, which offers great advantages for the treating physician and also can -- both more convenience and could -- shorter time to you get an answer. And this is an important clinical need, which is somewhat unmet today. And this has been recognized by several key opinion leaders, leading ones within -- especially the breast cancer area, where we have the strongest [ set of data ] and strongest collaboration, and that's also our key focus area to introduce the product. Together with them, we have performed many -- signed clinical collaborations that has resulted in publications, clinical data, which is the foundation, as Warren said, for more or less all the commercialization activities from there. That also has generated interest from our pharma customers. The market potential is huge, SEK 2 billion for the 1 that we have identified, excluding the Pharma Services and companion diagnostics where the breast cancer area is about 25% of that. And if you look at the milestones. Yes, the first 1 in U.S. was the lab certification. And so now we are open for business, you could see. We have made progress when it comes to the PLA code and agreements, both with commercial agreements and with hospitals that next big milestone, I would say, is during '24 where with the PLA code, you were able to get a specific code and a price allocated to that code for Medicare, and we expect to have that in place during '24, and that opens up a big patient population for us. Our long-term goal is to be able to realize 15% of that identified market potential in U.S. within metastatic breast cancer and also in parallel, expand outside of the metastatic breast cancer area. If you look at Europe, the milestone that we've passed is the first agreement, 2 agreements, 3 markets. And during '23, '24, this fiscal year, we will add additional ones, and we'll focus on the big European countries and the Nordics. We have a similar goal there to realize 15% of that market potential on the markets that we are introducing the product on 3 years after launch. And if you look at the Pharma services, we see significant growth within that area. We're starting the new fiscal year with 3x as many ongoing projects. So of course, you could see -- you could expect that we are able to grow the revenues proportionally or even more actually. The next step there is to establish the first companion diagnostics development contract with a bigger portfolio, the probability increases for that, and we're looking forward to come back with a more detailed time plan around that. That was our presentation, and next step is to open up for a Q&A session. And I think Johan is nearest from radar -- if we start with you and then we go through the equity research analysts before opening up from the audience that has submitted questions in chat.

So if Johan is online and is not muted like I was, you are welcome to -- please, Johan.

Yes, I believe I'm unmuted now. Can you hear me?

We can hear you well.

Excellent, great. Yes, a few questions. During '23, '24, this year for you then. Are you intending to report when you activate centers and hospitals in terms of delivering sales, yes, delivering tests, sorry, DiviTum tests, of course?

All right. That was a good question. So what we will -- we are -- our plan ambition is to continue the way we have done as long as we enter a commercial contract. We would like to communicate that as transparently as possible. When it comes to -- so far on the U.S. market, we have communicated with MediNcrease and Contigo Health. And as you have maybe noticed, it's in conjunction with them. It's a collaborative. They have [ called in a PR. ] If you look at Contigo Health and their social media, et cetera, they are also communicating that. So that's the best possible scenario. The next best is that we can enter agreement but they won't be so keen on us mentioning their name. Then we will PR anonymously. So far we have always been able to disclose the other party. And -- but we would like to continue to serve all investors with that type of information because we understand that's important to be able to follow the progress that we are making. When it comes to receive test, et cetera, we will report that as part of our quarterly reports. At this point, we haven't broken down revenues on different areas. But going forward, we will be doing that according to the IFRS rules, basically. We're following that. So you can expect to see a more detailed breakdown going forward. Does that answer to your question?

Yes. Maybe also it would be interesting to going forward and to have the feedback regarding actually how many centers and hospitals that are active and are delivering tests, not only the sales number?

Yes, that's a good point. And we have not -- as Warren said, we are in negotiation with our first -- we have our first commercial agreement with payers. We have delivered too our first agreements with hospitals. We are in negotiations. You could expect to see that in the coming months. And of course, such an agreement is not only 1 hospital, its several hospitals. It's kind of a chain of a network of hospitals, and we would like to be as specific as possible on the numbers, so everyone can do their analysis and see how we are progressing.

Excellent. And a clarification then on the commercial contracts like Contigo, our sales efforts and marketing efforts included on their side, so to speak?

Yes. Warren, maybe you can elaborate a little bit on the -- how this agreement works because this is something you don't see in Sweden also. So maybe we need some -- little bit of education here, Warren. Can you help us with that?

Yes, absolutely. And thanks for the question. With regard to these commercial agreements, how they work essentially is that they -- they work with the employers, so employers have employers sponsored health insurance plans. And so they work directly with employers to provide additional benefits to their members themselves, their employees. So for institutions like ourselves that are out of network, what this tool basically does is it enables a sample that comes in, we run the sample. We report these results out. And then as we invoice or bill the insurance company, the insurance company themselves take a look at the agreements that they have with these commercial providers, so Contigo or MediNcrease. And the rates are already negotiated so that the employer themselves can be able to essentially approve that those particular tests or services so that their members have access to these types of tests. And so that there's a method in place for us to get paid as well. From a marketing perspective, what these organizations do is they do notify their members that they have signed an agreement with us. So there is information that flows back to the employer themselves but it also gives us access as well to contact those employers and work with the employers to let them know about our particular product DiviTum itself. So that they can notify their members that are being treated for metastatic breast cancer. So there is a marketing angle to this as well.

Excellent. And also a follow-up on -- we can call it matches with these commercial contracts like Contigo and MediNcrease. Are there matches between their network and reach and institution that you have established contracts with from earlier studies and KOLs and the likes.

Yes. So absolutely. So when we -- as we work through these particular contracts and the members that these commercial agreements, these organizations are contracted with -- that's exactly what we do is we take a look at the location of the employer groups, and we align that with agreements that we've had or collaboration we've had with key opinion leaders or institutions. So we're able to really use this as well from a kind of a targeting perspective and being able to drive outreach in those specific geographic areas where we've already had relationships with key opinion leaders and institutions and know that organizations in that area actually have coverage or contracted to these commercial agreements.

Very good. And -- and could these relationship be complemented with direct contracts with specific centers and hospitals?

So that's a little bit different. So this -- these commercial contracts are really designed so that when we do the billing to insurance companies, it's a tool that we use to be able to get paid and provide access to those members. With the agreements, the client bill agreements that we're talking about, these are agreements directly with institutions and when I say institutions, I mean hospitals specifically, with those particular institutions, when they send us sample the test, we receive the sample, we test the sample. We report the results back and then we actually invoice the institution for that service rendered. So for us running the test. In those situations, we actually do not provide or we do not bill either private or public insurance. We bill that institution. That institution itself, then what they do is they bill insurance companies. So from our perspective, the real benefit is that we're able to negotiate a price with those institutions. We get paid that price and we get paid on time with that price. So it makes the efficiency of billing and getting paid much, much greater for us when we signed these commercial agreement or with these client bill agreements with hospitals, and that's why we have such a big focus on that side as well. So there are 2 really separate things that we're working on there.

And these billing contracts, direct billing contract is something we can expect then between 1 or 2 months or something like that.

That's correct. We're -- in the next month or 2, we should be able to share with the market that we've executed our first contract. I can tell you that our customer-facing team, this is a very high priority that we focus on. So we do have a funnel of these that we're working on. So what we anticipate is after we're able to get that first 1 across the finish line, there'll be more to follow. So there should be kind of this continuous flow of these contracts. That's part of our core strategy.

Excellent. And finally, Anders, you mentioned that the growth of pharma collaborations has been significant, done up to 17 from 6, I believe. And that you also alluded to that sales might increase something in line with the similar ratio? What's the baseline then to clarify.

Yes, the baseline, we just closed our fiscal year with SEK 3.5 million -- SEK 3.4 million -- SEK 3.5 million in sales, and that's entirely -- more or less entirely from those research use only since we're just starting up the business in U.S. and in Europe. So up until -- yes, the majority of that is from pharma services and those projects that we've been running. And now going with 3x as many, of course, we should see first you contract and then you deliver the project, then the revenue comes. So yes, that's the logic. So yes. We move on to Dan Akschuti from Pareto. See if we can get Dan in, and of course, it looks like you're unmuted, so say something to see if we can hear you Dan, now you're on mute now.

Just to deviate a bit from the sales topics, noted on Page 5 of your report that you mentioned that the cash runway is into March '24 and that you consider financing options sometime during the fall, considering your current stage, is it an option for you to look for non-dilutive funding, especially considering also where the share price is that and we saw with many other companies recently that you can do kind of maybe a normal bond or a convertible? Or is this that something you're looking at?

Yes. That's very true. And the financial climate has changed a lot in the last 12 to 36 months -- but 12 to 24, I would say. And so we as Anders reported, SEK 140 million in cash at the end of period and a burn rate of roughly SEK 10 million per month. So that ends up in where you said quarter to next year. But you should also expect our revenues during the year to grow as and we will keep our cost focus. So revenues should grow more than our costs, of course. With that said, we think we would like to have more margins when it comes to our financial strength and our financial position. And we are looking to several different options, and we've been doing so for -- basically since the last transaction we did in December. And we're looking broader than just equity. So that's all I can say right now, but it's an ongoing activity, and we make progress there as well. And we have to come back with more details when we can talk about it and make a PR about it. So yes, we're looking into that. And all the different areas that you mentioned has been assessed.

Okay. And maybe a follow-up here considering you have a strong US sales team, of course, but you have a product that needs to get to a lot of patients and just comparing your sales team in size versus other such and there is -- it's on the smaller end. Again, quality is more important than quantity, absolutely, but are you expecting maybe if you get a good nondilutive funding that you might expand your U.S. operations as well then?

We are looking to expand our sales teams over time so we can accelerate uptake. At the moment, we're pretty happy. We are focusing on establishing these contracts, and it's more bigger agreements. And with our senior sales team, we are -- I think we have a perfect match and fit currently. And it's also great to hear that you have compared benchmarked us against the other organization. I think we have a very effective approach with the senior people in that are able to generate this agreement that will enable a large scale increase, so, yes, in a short period of time. As we expressed, there is a lot -- huge benefits of [ starting ] with this client bill agreements in combination with the PPOs that we have already PR those agreements. So yes, we are cost focused. We have an efficient small sales team. We won't increase costs until we see an opportunity to do so through increased revenues or -- and a stronger financial cash position.

Well, Anders, if I can make an important comment as well on this, is that because we're very, very laser-focused in regard to our call points, we're able to be very effective with the size of the team we have today. Where we also have a real advantage over other kind of similar companies is, we are calling on a very specialized portion of the healthcare system. We're calling on medical oncologists that focus on breast cancer and where other products on the market are really designed more for screening and primary care. And when you go that path, you're talking about a population of 250,000 doctors that you're trying to address. And there, it takes orders of magnitude more effort to be able to penetrate that market. So I think that the position that we're in, we're in a very, very nice position in regard to being able to be really laser-focused in contacting and driving interest in through medical oncologists.

Yes. It's a good point. And if so, I'd like to add also, you covered briefly Warren, but the preparation work you've done, identifying the oncologist with the highest potential and getting these contracts in place, et cetera. So we will -- that will contribute even further to the sales efficiency, which is, of course, important.

And I think what you touched upon Warren is what we noted also in our research that you're having a product in a treatment setting and monitoring. You don't need to convince a lot of people to do screenings of conditions that they don't have right now. So that should make it easier. Maybe 1 last question. It's to funnel down all the complex processes that you're engaged in right now as you're on 1 hand with the reimbursement side where you also work with these companies where you signed already 2 agreements. And on the other side is where you mentioned that you had basically discussions with all the NCI centers as well as 18 others. So we can expect now from what I understand that you will get reimbursements in place now in the second half and even Medicare PLA code will come, which will be very important versus the general approach there. And that you will have in the next 1, 2 months orders from hospitals, so that kind of both the order side and the reimbursement side is falling into place now in the second half of this year. So is that correct to summarize it like that?

Yes. I'll hand this over to Warren for the details, but I'd like to comment actually that reimbursement is not that binary. I mean you could say, to some extent, we already have reimbursement in place now because we have approval now that we can submit code, for instance, claims to Medicare using a generic or miscellaneous code. However, that's a bit cumbersome because there's a lot of parameters that you have to negotiate case-by-case. So it's costly and it takes time. And it's the same thing with the private side. But having these agreements with PPOs takes care of that, having agreements direct bill, so will take care of that for these customers. So we're slowly and -- but securely, building coverage over time. So it's not a binary thing that you go from non-reimbursement to reimbursement. But with that said, maybe you could elaborate a little bit and give a little bit more how we're thinking with those different areas, the public Medicare, the direct bill and the private payers were...

Yes, absolutely, Anders. I think I'm glad you pointed out the fact that we can file claims today. And there is a process in place, there's a CPT code that we can use. It's a miscellaneous chemistry code that we can apply today for any products that come in where we're billing either private insurance or we're billing a Medicare itself. I think the important thing to note here is that there's not just 1 thing we need to do in regard to driving revenue or driving reimbursement itself. So I think as I tried to demonstrate in my presentation, there are things that we do from a private insurance perspective, there's things we do from a public insurance perspective. There are some things we do to kind of a bit navigate around private insurance, and we do this with client bill. One of the real benefits that we have in applying for a PLA code and getting that pricing in place is that another benefit of DiviTum is that 50% of its total available market is Medicare patients. So by us being able to go and get that PLA code and get that price, that really covers about 50% of the total market, which is really beneficial to us. And then when you layer on those agreements, those commercial agreements, the client bill agreements, that ends up taking pieces of that private insurance and providing coverage there. But by all means, today, we filed claims under miscellaneous codes until we were able to get that PLA code. So I hope that helps out as well.

Okay. And we have [ Kempen, Enluisa. ]

Can you hear me?

Yes, I could hear you briefly, then you went on mute again, so try again and we will hear you.

Can you hear me?

We hear you well. You are welcome [indiscernible]

Yes, I have a few. Maybe just to start off, we were wondering if for the upcoming time, so let's say, this next financial year, will you fully focus on the DiviTum? Or are you also currently developing or trying to develop other assays and how does this reflect more on the OpEx side, so on the distribution of R&D and SG&A expenses for the coming year?

Yes. All right. I can answer that. Our focus is more or less -- yes, it's fully on DiviTum basically. And it's not so much more development being done. The product is developed. It has gone through 510(k) clearance. And so what we're doing now is more products maintenance and support. So that's what the R&D team is supporting the commercial organization and are doing improvements to the product so we can manufacture it even more efficiently, et cetera. So it's more product support and maintenance that we're doing. We're looking to do our -- take the major step in developing the product in collaboration with pharma and that way, get customer finance product development. That's the plan.

Clear. And well, as we've been discussing, you already are fully on establishing the commercialization in the U.S. and Europe. But for when do you expect more or less the launch in Japan?

Yes.

Of DiviTum? Do you have any idea?

Yes. I think that's a priority in, I would say, the coming years because there, we're not looking to establish our own operation. we are looking to do that through a Japanese or a partner with presence in Japanese. And I think a successful launch in U.S. and in Europe, of course, will make us more attractive from potential partners. So, yes, I think that will be an enabler for those discussions.

Okay. And so regarding the pharma collaborations that you have established so far, correct me if I'm wrong, but I think you haven't really disclosed any names on this. So are you considering at any point to disclose it or not, why because -- well, I think it could be some kind of validation, let's say, for your assay, of course, but yes...

We -- yes, we have disclosed pharma companies that has disclosed that they work with us. So the 1 that we -- that has published data with DiviTum that they have acquired with us -- acquired kits and then analyzed with the DiviTum are -- yes, as our customers. The first 1 was Pfizer. Pfizer did a presentation on AACR in April 2018 when they did a poster presented data on CDK4/6 inhibitors, palbociclib with our assay, it was really interesting poster by the way because they were the first 1 to take serious samples only a few hours apart, and you could follow how dynamic our biomarker is because when patients were off treatment, you could see how the cell proliferation increased. So that was Pfizer's data that they were generous enough to publish. Another -- the next 1 was Carrick therapeutics that's developing a second generation of CDK inhibitor. They published their data at San Antonio. I think it was in 2020 or -- yes, 2020, so they have also disclosed that we've been collaborating. And the last one, I would say, is Novartis through the BioItaLEE study that was presented on the 2022 ASCO conference as an oral presentation. So those are the 3 that has been -- yes, that been disclosed. And we strive to -- when we sign agreements that we can communicate, we will do so if possible. So like a companion diagnostics agreement where we signed a deal that both partners are committed to do a project, we can -- our ambition is definitely to PR that either anonymously but probably with the partner name as we've done with the commercial PPO contracts that we just published.

Okay. That's great. And indeed a good sign of validation. Just 1 final question and a bit straightforward that's how many contracts with the cancer centers that you have mentioned? Do you expect to achieve more or less, let's say, for this upcoming financial year?

Yes. Warren? Do you want to elaborate on that?

Yes, absolutely. So our focus is extremely heavy on being able to get these contracts in place. What -- as I mentioned before, in the next month, we anticipate -- a month, 1.5 months, I guess, we anticipate our first agreement in place. What we're targeting for the year is to be able to put 10 of these agreements in place. So that's an internal goal that we're focusing on. And I feel confident that we'll be able to achieve that.

And if you want to -- just roughly if the majority of those are NCCN/NCI designated cancer centers, there's about -- is it 55 or -- that treat patients -- that would be a significant part of the treat the -- cancer centers treatment patients in U.S.

Yes, exactly. There's 56 that actually see patients. And if I can even elaborate on that, when we sign these agreements many of these institutions are -- they're enormous. They have many, many hospitals that are part of that single kind of -- it's not a single institution. It's a network of these hospitals. So when we signed these agreements, it's typically not a 1 institution contract. It's many, many institutions. In some cases, there's some of these organizations that have 20 hospitals associated with it. So these are pretty sizable. So 10 is not a small number, 10 is a very large number in the grand scheme of things, but that's what we're focused on.

All right. We actually -- we usually have a lot of questions in the chat. But this time, although there's a lot of attendees actually. But you can, of course, always come back afterwards and mail our IR at Biovica address and we are responding to IR questions. But with that said, we're also out of time. So maybe it was good from that perspective. Thank you very much for your attention. We are in a very exciting phase, and we have some early wins and a lot of progress within all areas. So we're looking forward to the near future, and we wish you all a nice summer going forward. Thank you very much.