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

Hello, everyone, and welcome to the earnings call for the second quarter of Biovica's broken fiscal year for '23 and '24. Short slide. The presenters for today will be, first, it will be me, Anders Rylander, followed by Warren Cresswell, Henrik Winther and Anders Moren. And the agenda for the call is a short introduction from me, and then I'll talk about the highlights, then we'll dive into a U.S. update with Warren Cresswell, and Henrik Winther will provide an update about our pharma services development. Anders Moren will provide an update about the financial status before we have a summary by me and the Q&A session. [Operator Instructions] So I will start by talking a few words about our product. So we are all on the same page here. So the product's called DiviTum stands for dividing tumor, and with DiviTum, we can from a simple blood test from the patient measure cell proliferation. And in the cancer that is essentially an important information as cancer grows through uncontrolled cell proliferation. So DiviTum can provide important information both before and during treatment information about the aggressiveness of the disease and also provide quick response if the treatment is effective or not. We have in clinical trials, shown that we can provide such information if the treatment is effective or not, only 2 weeks into treatment. That is a significant improvement versus imaging, which is the standard method being used today, which requires 3, 4 months before evaluation of progression is typically done. We've also, in another clinical chart shown that we, on average, I can provide feedback about progression around 3 months on average, quicker than with imaging. So we have a very convenient tool for monitoring of cancer therapies in the metastatic setting, we shown in several clinical trials. Talking about clinical trials. Here's a summary of the clinical trials that we have published so far together with our partners or to be correct, it is the partners that has used our assay and used it in clinical trials that have made the publications. Before that, there will be peer reviewed and published in scientific journals. This is, of course, essential for us, having data proving the value of the product. These trials have shown that DiviTum is strongly prognostic both in local setting of cancer, but also in the metastatic setting, where it's been shown to be prognostic both for progression and overall survival. And it's also been shown to be an excellent monitoring tool where we've been able to follow patients and taking repeated samples over time. Our focus area is the breast cancer area, where we have the majority of the data, 14 studies and over 3,000 patients. We also want to highlight the collaborating partners. We have really strong key opinion leaders, some of the leading ones in this area, especially within the breast cancer area that has performed these trials at some of the most well renowned academic institutions in the world, such as Mayo Clinic and Johns Hopkins and Dana-Farber, et cetera. This is, of course, important because these people and these institutions, they have impact when they reach out to others and present the results of the clinical trials. When it comes to our go-to-market plan and the market potential, we'll talk a little bit about the plan and the different areas. Our focus is initially now to commercialize the product for use as a monitoring tool within metastatic breast cancer, both in -- on the U.S. market, where we have an FDA clearance since last year, and we're now in the ramp-up of the commercialization phase, which Warren will talk more about. In Europe, we also have a very good start, where we have signed several agreements with partners that is providing analysis services and also has a sales force working against oncologists on the certain European markets. Another area with great potential is the pharma services area where we serve pharma companies using our product when they develop new therapies within the cancer area. Something that Henrik will dive into and explain a little bit more where we stand. We have made great progress there as well. Looking further ahead, we have also a great opportunity and potential to widen the use outside of the breast cancer area into new indications. We already have data on metastatic malignant melanoma in combination with immunotherapies. We also see potential within lung cancer and prostate cancer. So there's a great potential for the product, and we have also made great progress during the last quarter where we are in the early phase of our commercial journey of commercializing the product. If we dive into the second quarter of our fiscal year and the highlights that we've had, it's been quite a few actually. That many that we have now be forced to categorize them. If we start with U.S. and clinical, Warren will cover these a little bit more in detail. But we made progress when it comes to direct bill agreements directly with U.S. hospitals or hospital networks, you might say, because we are now curving around 50 hospitals with these 3 agreements in 3 states in the U.S. We also made a PR about preliminary decision with the Gap-fill process for CMS and then after the end of the period, we made a new PR that in the end, we concluded or CMS concluded that we'll go with a quicker method called Crosswalk, which means we'll have a price or be included on the Medicare price list from start of first of January next year, which is great news. Warren will also explain a little bit more what that means. We're making progress when it comes to the lab. We've got the cap accreditation that opens up opportunity in certain geographical areas and at certain also private insurers, et cetera, which Warren will talk about. And we are continuing to strengthen our clinical data by initiating new clinical trials. So a lot of progress on the U.S. area this quarter. Looking into pharma. We have now a portfolio of projects, and we can see that they are growing, and we can see that revenues are keep growing. Henrik, will you give you some little bit more guidance around what we've done there and also how we've been able to -- within which areas we've been able to grow our business there. And also, when it comes to the more administrative PRs that we've issued, we've communicated that we will do a rights issue. That's partially guaranteed and we're progressing with that. We're also carried out an EGM in that process. And then the last news before end of -- or sorry, after the fiscal -- or after the Q2 ended. During November, we announced that we signed a commercial agreement for Europe. And if I move into that slide specifically. It is with a Danish company called Axlab, a company is growing very fast and is focusing on diagnostic or sales of diagnostic products, and they have a customer-facing team of 25 reps within sales and marketing and they are planning to expand that when they're bringing in dividend to their assortments. So this aligns very well to the kind of partners that we would like to team with that is successful, fast-growing within oncology has a sales force, has the competence and the drive to make us both successful. And we've set aggressive targets to within 3 years, realize 15% of the market potential on this market. And I think also, we have some really strong partners when it comes to the clinical setting with Karolinska and we have ongoing trials also with Christie Hospital in Manchester, that Swedish hospitals like the one in [indiscernible] also is part of. So this is great news also for the European area. All right. And then I'll let Warren on stage. And Warren, if you please can take us through the U.S. status and walk us through what happened during the last quarter.

Great. Thanks a lot, Anders. I really appreciate it. You can -- there you go. So we have -- we continue to execute our U.S. strategy. And I think this quarter has been not only productive, but I think very exciting for the organization as well. Throughout the presentation, I'm going to talk about a number of different topics. I'm going to talk about Medicare pricing that was recently established. I'm going to talk about the 3 hospital contracts that Anders alluded to, Talk about regulatory progress we've made with our CLIA laboratory. I'm going to talk about clinical trials that are ongoing in the U.S. And then I'm going to finish with some feedback that we've received from medical oncology has been very positive that I wanted to share. Next slide, please. So Medicare pricing, this has really been part of our overarching reimbursement strategy is to work with both the AMA and CMS to be able to establish a price for DiviTum. And we started this process early in the year. We worked with the AMA. AMA is really the gatekeeper of all coding in the U.S. You need to have a code to be able to provide essentially an invoice, where it build to Medicare or to private insurance. And we did establish a proprietary laboratory analysis code. That code is actually specific to both DiviTum and DiviTum being run in our Santiago based CLIA laboratory. So what that means is, with this very unique code, if there is a competitor that decides to develop a TKA assay, they're not able to use our code nor are they able to use our price. They made themselves would really have to start from scratch. So it's really unique to us, our product and our laboratories. We also were working with CMS. CMS is the one that actually is a part of the organization that determines the price for a particular product. So we work with the CMS subcommittee. And during that discussion, there's really 2 paths that we could take. One is called Crosswalk, where we compare our product to a similar technology to establish a price or there's another payment methodology called Gap-fill, where you really have to start from scratch and prove the value of your product. That's a 2-year process. In September, CMS issued a preliminary payment determination where even though the subcommittee voted in favor of Crosswalk, CMS ended up deciding after further evaluation, that it would be best for us to follow the Gap-fill payment methodology. After they indicated that there is a timetable where we can provide some additional information and ask for reconsideration is what we did in October. And after they took a look at the information we provided and the argument we provided, this month, in fact, last week, they did reverse their decision. They made a final payment determination, and they indicated that we could pursue Crosswalk. And what that means is January 1, 2024, so just over 1 month away, DiviTum will have a price of $322 per test for Medicare patients. And that is really a huge milestone for us here in the U.S. Now I know Anders has given guidance in the past in regards to having an average test price of $400 per test. And this works in perfectly in our equation because we had calculated $322 per test. When we add in private insurance and when we add in hospital agreements, the net is $400 and maybe even a little bit more. So I think we're doing a really great in regards. Next slide, please. In the quarter, we did sign -- execute 3 separate contracts. Now these 3 separate contracts aren't necessarily for 3 hospitals, as Anders had indicated just a few minutes ago. This really encompasses about 50 hospitals because these hospitals really act as networks. The first one that we signed is based in Arizona, but they really do cover the Southwest region, and they're one of the largest health care providers. They themselves have about 30 hospitals in their network. And we're just starting to see samples come in through some of those hospital institutions now. The second agreement is with the largest health care provider in Missouri. This is a NCI-designated cancer center. They have 18 hospital laboratories, and they're working through really kind of the final details in regards to logistics, internal logistics before they start sending samples, but the contract is in place and executed. Thirdly is a contract with really a world-renowned cancer center. They're an NCI-designated center. They're located in Florida. They serve patients from all 50 states, and we are actively receiving samples from that particular institution. The target that we have in the U.S. for this fiscal year is to be able to sign 10 hospital contracts. We do have a pipeline of institutions that we're working with. And one of the things I want to mention as well is that the real takeaway with these contracts is we've prenegotiated a price, so that is in place. But also the fact that each one of these institutions has indicated that there is clinical utility with DiviTum, which enables their oncologist to order the products, and that's a huge win from our perspective. Next slide. From a regulatory progression perspective. Back in February, we worked very hard to be -- to get our lab CLIA certified. We achieved that the following month. We were credentialed by Medicare, which means that we could receive samples, test those samples and invoice Medicare. And then in October, we're very pleased to be able to earn our cap accreditation and so this is a lot of very hard work that's gone on within the laboratory over the last year to be able to get CLIA certification being credentialed by Medicare and being cap accredited. So today, what we're able to do is we're able to conduct business in 48 of the 50 states, and we anticipate the 49th state that we can do business in is in Maryland, and we anticipate that being -- happening getting a license anyway is in the next month or two. And we're working closely with the state of New York. New York is a bit of a longer process. They do require cap accreditation before you can apply for a license. So we're working with them. The time frame there is a bit longer, but we anticipate kind of late H1, early H2 to be able to get a New York State license, and we'll be able to then serve their 20 million people that are in the state of New York. Next slide, please. We are also actively engaged in prospective interventional clinical trials and really in no particular order, we are working with Yale University and with Yale, the clinical trial that's open and recruiting patients. It's for both drug-to-drug interaction. They're looking for patients that are taking a therapy, specifically CDK4/6 inhibitors and where we see a high TKA value where maybe the patient isn't responding to the therapy and one of the things that physicians are looking at as the drug-to-drug interaction was that impact to the efficacy of the drug. The other side of this is also looking at dose reduction. So when you have a patient responds incredibly well to a therapy, is there an option to actually dose reduce that patient so that the drug is a bit more tolerable. That study is up and running. The second one I want to talk about is with Washington University in St. Louis. This trial is called TK impact. And this is a trial that looks at like real-time biomarkers of tumor response. And again, this is patients that are on CDK4/6 inhibitors that are hormone positive, that are metastatic breast cancer patients. With -- in this particular trial, they're looking at not only our product, DiviTum thymidine kinase, but they're also taking a look at other biomarkers as well and seeing how a physician may act differently if they had a TKa value that was elevated or declining versus other biomarkers. This clinical trial is open and recruiting patients. And in fact, there's an abstract that was submitted to San Antonio Breast Cancer Symposium, and that will take place next week. And the third one is another clinical trial through Washington University, and it's called the BettER trial. And with this particular trial, it's biomarkers driven early therapeutic selection. So when a patient goes on a therapy, we look at the thymidine kinase level at baseline and then we look at it cycle 1, day 15. And based on the results of those 2 tests, the clinician will make a decision whether they keep the patient on a particular therapy or they make a decision to change the therapeutic selection that it made for that patient. So that trial is opening in early H1 of next year. So we're really excited about this. The real takeaway from these clinical trials is that, One, it gives us data where we can understand where we can potentially expand the label of our product. It also provides clinical utility, and it also helps from a reimbursement perspective as well. Next slide, please. And then lastly, I'd like to end with feedback we received from medical oncologists. And the feedback has really been overwhelmingly positive. There's 3 particular comments I want to review real quick. One of which is doctors indicating that the test really provides confidence not only to the physicians but also to the patients. So one oncologist located in the Southeast indicated receiving a DiviTum TKa value of less than 250 gives me the confidence that my patients have a low likelihood of disease progression. And that's really exactly on label what we want both physicians and patients to experience. The middle one is really early determination. So we have physicians this one, particularly in the Northeast that from the baseline test to the cycle 1 day 15 result, a reduction in TKa value suggests that my patients are responding to therapy. So it really gives them an early understanding like Anders mentioned before, that we can see things in a couple of weeks' results. And thirdly is really this personalized therapy approach, which is providing patients with the lowest effective dose rather than the highest tolerable dose personalizes therapy for my patients. And this is really in line with Project Optimus that the FDA has been talking about where they're looking at dosing patients, not based on maximum tolerability but minimum effective dose. So it feels like we're exactly in line with where the market is shifting there as well. And with that being said, I'm going to hand the presentation over to my colleague, Henrik Winther, and he's going to give an update on Pharma Services.

Super. Thank you very much, Warren. Yes. So I will provide you with an update on what we have achieved during Q2 within our Pharma Services and collaboration business. So for those of you that have actually seen our presentations before, this slide might seem familiar. It really shows the step-wise approach we use when we onboard pharma. So typically, they start out by evaluating our technology. It will through an agreement, TESA, we call it. When they have actually realized the potential of the assay, they typically move into step 2, where we sign a master service agreement with them, allowing to actually run several projects with that pharma partner. And then at some point of time, when we have run a couple of -- quite a few perhaps of these projects. Final we will start the discussion about what is the potential of actually customizing your assay towards our drug? So that's the third step, the CDx collaboration. And then finally, it should lead to products, biometer products brought to the market. And that's really the goal of this business is getting new products to the market. So if you look at the status on the slide here on the lower part, what we achieved during Q2 was a great continuation of what we actually also -- or the positive trend we saw in Q1. So totally, you can see we have now 21 projects and in preventatives. Here, you can see how it looked in Q1. So we went up in 3 projects. Even better is actually that if you look at a little bit above and look at the T-cell and the MSA, we managed to go from 12 MSA projects to actually 19 projects now in Q2. And that's really because some of the T-cells, they turned into master service projects. And then we also signed 2 new T-cells with pharma. So totally, in Q2, we have 21 projects. We also signed one new master service agreement during the quarter. So a very, very positive progression. If we dive a little bit deeper into what happened during Q2. I have a few highlights here. So financially, we actually grew 35% from Q1 to Q2. And if we compare to last year's Q2, we had 130% growth. So really a strong Q2 in this part of our business. Another -- a couple of other highlights is that we saw an increased interest from Tier 1 oncology pharma companies. And you'll have a quote here from one of these companies saying, no, they really said, "I can't understand why we haven't used your biomarker before. " And this thing about Tier 1 pharma companies is that these are the companies that will really pursue the companion assay development -- and therefore, it's super important for Biovica to have these interactions with Tier 1 oncology pharma companies. Another trend we saw was that for many of these projects we have. They are now -- we now have activities, not only within the CDK4/6 inhibitors and also the second generation of those drugs. We actually also see activities within serves and not the least immune checkpoint inhibitors, the ICI's. And if you -- if you take a look at the slide here, you can see that this is really broadening our total addressable market because we're moving outside breast cancer into other indications as well. So also super positive. And then the final point I bring up here is the fact that we had one company actually reactivating their project. This company is about to enter into Phase II. And this is, again, super positive to Biovica because Phase II is exactly where we want to be. This is going to, again, increase the likelihood of us being part of a CDx development activity. So overall, very, very positive Q2 on the Pharma Services business. So with that, I'll hand over to our finance.

Thank you, Henrik. So a few slides on the financials. If I can get this to move, Yes. So net sales for the second quarter was SEK 2.6 million, previous same time, the second quarter last year was SEK 1 million. So we had a significant growth year-over-year in the second quarter. Also net sales year-to-date for Q2 or for the first 6 months of our fiscal year, at SEK 4.3 million in sales. You can see here the dark blue bars are current fiscal year and the light blue bars are previous fiscal year. So we sold SEK 4.3 million this year and accumulated and SEK 1.5 million. You can see also graphically that we sold more this first 6 months than the full year for last fiscal year. And sales is mainly coming from the pharma services business. That's the pharma services in terms of test services to pharma companies, but also kit sales to pharma companies. A little bit on the cash flow. Cash is extremely expensive. So we are watching our cash very, very diligently. Operating cash flow before change in working capital was minus SEK 24.5 million. Previous quarter, it was SEK 30 million. So we have a significant improvement there. Change in working capital this quarter was minus SEK 3.9 million. So all in all, it was SEK 28.3 million. Q1 this fiscal year was minus SEK 38.5 million. So it's quite a positive trend there. Cash balance for second quarter, SEK 46.9 million. That's basically in line with what we had last year. Last year, we had a rights issue of SEK 150 million, I think. And this year, we're projected at SEK 120 million. Total head count for the end of October was 37. Last year, it was 27. You can see here that we have 24 out of these 37 in Sweden and 13 in the U.S., last year same time in Q2, we had 5 in the U.S., so the main increase is coming from the U.S., and that's the sales team that was employed first of December last year. So with that, I'll hand it back over to Anders for a summary and Q&A.

Thank you very much. I will sum it up. So we have DiviTum, a very important product that -- or a product that meets an important -- currently unmet clinical need, the ability to improve monitoring of cancer treatments. And we have, together with the key opinion leaders and the -- from some of the institutions made scientific collaboration and clinical trials that has laid a foundation for our commercial journey which we are taking now the first steps now a few quarters in. And still relatively low volume, but we see a very positive trend in progress, both -- yes, on all 3 areas, U.S., Europe and pharma services. And if you look forward, our targets for the fiscal year that we're currently in, '23, '24, that ends in -- by end of April. We have the ambition to sign an additional 7 of those agreements in total 10 and another agreement in Europe and in total sales more than double digits in Swedish krona, so more than SEK 10 million. And our long-term goal is to break even mid-2025 to become cash flow positive. And in order to do that, our sales projection is to have revenues of SEK 50 million per quarter. And I think we're taking some important steps into that direction. It feels really positive. In order to take us to cash flow positive, we're not a rights issue where the subscription period starts tomorrow. So later today, the prospectus will be published on our website. The purpose is, yes, as I said, to take us to become cash flow positive. It is SEK 120 million, which is partially guaranteed in the rights issue and then an additional SEK 54 million in warrants that is effective during September next year. The subscription price is [ SEK 261 ], and I myself looking very positive on our future. So I will be participating with SEK 10 million in this rights issue. So very, very good quarter for us, and we look positive for the future. So with that, I'd like to open up for the Q&A session.

See if we can get our -- some of the equity researchers in. I can see that we had, at least for a while, Chien-Hsun Lee from Pareto. I don't know if we can -- just I can see that he is now unmuted.

Can you hear me?

Yes, I hear you Perfect.

Congrats with the process. So yes, my first question would be, what do you think about the process or time line when the hospital contract is signed until you start receiving orders, do you need to clear anything?

Yes, all right. So the question, I guess, is related to the U.S. market, where we signed contracts with hospital or hospital networks. And we have a process in order to get those going. So maybe Warren, if we more focused on Warren, Warren could elaborate a little bit on those steps and also timing.

Yes, absolutely. And thank you so much for the question. I think with regards to getting a contract signed and then getting samples coming in, it is -- there's a process that takes place. Initially, when we engage a hospital, we talk to kind of a champion a person that's very, very interested in using the product. We go from there to really meeting with the formulary committee. With the formulary committee, they really make the decision whether or not individuals of the hospital kind of order their test if there's clinical utility. From that point, we go through a contracting phase where we contract with the institution, negotiate pricing in terms of service, things of that nature. The fourth step is really the logistics side of things because internally, when an oncologist wants to order a product they need to know how is it built into their EMR system? Is it a paper order or what that may be? And then finally, would be receiving the orders from the institution. So in some cases, this process can take -- can happen incredibly quick. And in some cases, it can take a better time. Our commitment is always to be able to move as fast as we can. So we're really reliant upon our partner to move quickly. So in some cases, we can contract and see orders in a couple of months. And sometimes, it can take us 6 months to get a contract signed and get orders coming in. But there's no real standard. I think each institution is a bit different. We do see the contract that we signed in Florida. They are very active in sending samples in every week, whereas the contract that we signed in Missouri, it's taken them a little bit of time to get systems in place. I hope that answered your question.

Okay. Perfect. And for those 10 hospital contracts that you aim for, for the fiscal year, to which extent do you think they will be able to cover the U.S. hospital chain? Would they be able to cover the majority? Or what kind of portion that you are thinking about?

Yes. So the hospitals. Those particular 10 hospital contracts will cover -- will not cover the entire U.S., U.S. is enormous, obviously. But it will certainly align with the revenue forecast and the financial commitments Anders has made. So in regards to that, I think that's how we tend to look at it. At some point in time, I think as we progress the business, then we reassessed and we take a look at other institutions. We do have a deep pipeline of institutions that we want to sign contracts with. There's also a balance kind of from a resourcing perspective as well. But I think certainly, those 10 contracts and the goals that we've put in place align with the revenue projections that Anders has shared with the market.

Okay. And maybe just a last question. So how do you expect the sales development or the distribution between direct bill hospital contract and the Medicare-related sales over the coming years? So I guess the hospital contract will start first and the Medicare sales will come in later, maybe in a couple of years. Is that correct?

There's 3 channels that we will get paid from. One will be the hospital contracts, one will be directly through Medicare, and one will be through private insurance. And all 3 of those avenues or those payment channels are open today. So we've submitted claims to private insurance, and we've been paid. We're submitting claims through Medicare, and we anticipate being paid by them. And through the through the contracts themselves. Our core focus is really working with hospitals to contract with them directly. So I would foresee there being greater revenue most likely through hospital contracts. But it will really depend on the mix and how it develops moving forward. But certainly, as well, one point I want to make is that the Medicare patients, those patients, certainly as we contract with these institutions, those institutions will be responsible for the building of those particular patients. When we receive a sample, oftentimes, that information is blinded from us. So we run the sample. We report the sample results back. It could be a Medicare patient. It might not be a Medicare patient, but we'll get paid the contracted price. So most likely, the revenue stream will be the greatest through to the individual contracts.

I'm asking Helle here, who's helping us with the production, see if we have -- if we can get Johan Unnerus also into the call. I see that you're working on that?

Yes. I have him here on the phone. And I'll just put the loud speaker on.

Excellent additional question regarding the U.S. sales and also a bit regarding the cost initially, some of the OpEx cost came in slightly lower in this quarter, is that a level that represents or you going -- moving ahead? Or is this sort of a lower quarter some reasons?

So I don't know if it's -- should do cost under OpEx?

Johan. We -- since we have agreed now with the U.S. team and the rest of the team regarding our cash out bonus to have that on rather equity-based bonus. We released that accrual that we had, was about SEK 3.8 million that we had accrued in Q1. We have released now in Q2. So you have that variance between the quarters. And we haven't initiated and we hadn't the time to initiate a long -- the new equity bonus program yet. So we haven't started to accrue any [ RFS II ] costs associated to that equity program yet. So there is -- but from a cash flow perspective, I think we are definitely on a better tractor than we were before we had this agreement with changing cash out bonus to equity bonus, but there will be coming an equity bonus accounting cost, if that makes sense going forward when we have this program in place, and that will be probably somewhere in January, if that makes sense. Does that answer to your question?

That's useful. So cash why -- sort of more modest level. And we also noticed that Anders intended to defend reasonable take interest in the ongoing rights issue?

Yes, absolutely. Yes.

And also to more -- it's clear that the direct bill will be very important, especially in Italy, presumably that we should expect a higher average price and also what sort of issues -- sorry, what sort of support will be necessary to drive the sales channels. Presumably, you need to encourage sales direct bill?

All right. So direct build question, see if I can repeat is see if I understood it correctly, and I see the focus is on Warren So that's good because it's a U.S. question. So you can keep it on Warren. So the question was direct bill, what kind of support do you need to execute? And if you can elaborate a little bit on price levels on direct bill versus Medicare, I guess, then, Warren?

Absolutely. So with -- to execute these contracts, there -- there's different pieces of this, as I just described, where we go through and we find a champion and work with formulary contract work with internal logistics. So where we're at now is where we spend a lot of time in the institutions talking to oncologists and driving interest and driving utilization of the product in these particular institutions. So that's real -- our real focus with these hospitals that have been contracted. Once -- as these contracts get signed and the logistics are in place, it's actually much, much easier for us to do business with contracted entities than it is for us to build on our own. Actually, the cost is much less to do business with hospitals that are contracted versus us having to build private insurance and Medicare and things of that nature. So it's actually a bit easier for us once we get those contracts in place. But still, you still have to spend a significant amount of time in those institutions driving demand. These hospitals, they don't require oncologists to use the product. But what it does, it gives us the opportunity to build interest in the product, and it really smooths the way for oncologists to order the products in. So that's really where we're spending the core of our time. In regards to pricing, all of the contracts that we sign are either confidential, I can't share those with you. But certainly, the price point is greater than the Medicare pricing I just shared. So the net-net, again, will be somewhere around when we add in private insurance reimbursement, Medicare in the hospital contracts that will be at $400 or more on average.

And Earlier, you alluded to that for the current -- not calendar year, but the year to end April, you expect higher ongoing volumes towards the end of this period and presume both of that will be related to direct sales is that how we should understand it?

I'm not sure -- I think I understood your question where our efforts are going to be placed, if that was essentially the question. Our efforts are certainly around driving interest and adoption of the products. Our team is very focused on working with hospitals to not only drive utilization within those institutions that are contracted, but also we have quite a pipeline of institutions that we are working with to contract. So that will be our focus, not only throughout this into this fiscal year, but also moving forward for quite some time. Did I answer your question correctly?

Yes. I think you did. Thank you. Yes, I think that's all for me. Perhaps a bit more color to your pharma projects and the prospects of promoting a project to the CDx stage? What about the outlook for the rest of this period? Or is that something we should expect later in '24?

Yes, I mean, what I can say is that, I mean, we're doing all we can to really progress on that front. We're having these discussions, as I described kind of the third step there. It is only natural for some of these pharma partners that they really want to try customize our assay to make an even better fit to their drug. So we have the discussions. That being said, I mean, it is, of course, in control of the pharma partner. So I can't say more than that. But it is certainly our goal to have a couple of these agreements signed as soon as possible as we can.

We have Luisa -- or do you have any additional questions, Johan?

Yes, we have Luisa from [indiscernible] on the chat.

On the chat? Okay. All right. So let's see, I have to put my glasses on to be able to read this -- all right. So the first one, I think, is -- I published it also you all can read. I think the first one is really interesting. That is project Optimus. I think Warren mentioned that briefly, and maybe you can elaborate a little bit. The project Optimus is what the FDA has launched, I think it was during '23 this year. And you can see on the conferences, there's a lot of focus and the objective is to go from maximum tolerated dosing to minimal effective. And then, of course, you need an effectiveness biomarker assay like ours. And maybe if you can give some more back on of flavor how that has been met from the oncologists you're talking with, Warren?

Yes, absolutely. And I think how you described it is absolutely perfect. Anders, is that this is something that the FDA wants to look at is how do they essentially go to this minimal effective dose, and they're doing it obviously for a couple of reasons, one of which is has to do with tolerability of the drug and managing side effects. So as we've talked to physicians, that have patients on these -- whether it's CDK4/6 inhibitors or chemotherapy drugs or I-O therapies or things of that nature. With all of them, they do have their own unique set of side effects and tolerability issues. And physicians really believe that if they can keep patients on a drug for a longer duration of time with it being effective, then the patient will have a better outcome. And certainly, with some of these drugs, there's a kind of a litany of different side effects. And oftentimes, patients will -- there'll be compliance issues where patients are not taking the drug because of some of these side effects. So I think it's a really good -- a really good thing that the FDA is doing here is taking a look at how can we -- how can patients be dosed this minimal effective dose because most likely tolerability will be better managed and there should be better outcomes. And the physicians that we've talked to, the medical oncologist we've talked to have been very aligned with this, and there's really been a lack of biomarkers that could help them out. And when we've talked to them about DiviTum, this is something where most automatically refer to project Optimus and are excited that this is a great opportunity for them to manage the TKa value to determine whether or not a patient is responding to a therapy. So I think this is a great opportunity for us where we really feel like we're at the right place at the right time with this particular product.

All right. Thank you, Warren. I continue with Luisa's questions. Will you provide any guidance what we can expect for '23, '24 sales. We just did that, more than SEK 10 million, we said. Could you provide more details on the progress applying dividend in other indications? Our focus right now where we put the resources is primarily within breast cancer. So we -- that's where we're driving demand and our focusing our efforts. The 3 clinical trials that we talked about, how many patients and the time lines about studies? So it was impact. It was a Yale trial, and it was the better trial that we talked about here, which we also have been PR in previously. And inverse trial by trial? But the impact trial was started. I think it was announced, is it 1.5, 2 years ago. And it's, as Warren said in the presentation, we'll be able to virtually have submitted, the Washington University that performed the trial has submitted interim results to San Antonio. So that's what you can expect around 2 years from start to interim results. So hopefully, they will be presented at the San Antonio Breast Cancer Conference. And in that case, we'll PR that as well. And the number of patients in that trial? I think it's said between 50 and 100. It's -- we have an option. It's not a fixed number, but it is in that range. And the others are pretty similar in terms of size and time line, although as [indiscernible] started this year with PR that and patients are being enrolled and the BettER trial will start early next year. So give you some feeling for how we're progressing. Yes. And then there's a follow-on question. How much does the CDx collaboration negotiations depend on these trials? Does it depend highly -- if it's okay, Henrik, I'll just answer and say, no, it will not. I think the data that we've generated so far is what has been driving the demand and the project portfolio that we have now with 21 projects ongoing on the pharma area. So this is more targeted towards the U.S. market getting into the reimbursement system and guidelines, proving clinical utility or strengthen our already proven clinical utility. So different purpose there. And yes, in regards to those trials and Project Optimus? I guess you can spin a bit. That's also a way that you can tell the interest from product optimist that the dosing question comes up. in these discussions. So as Warren said, both the Yale and the BettER trial has a dosing component. And as you know, we had the palbo-dosing in Washington University and that was published or presented at least at the conference like a year ago or so. So we are already into this area in terms of clinical trials. Yes. See if I can continue reading Yes. Europe, you mentioned that your negotiations that indicate that you'll be having agree -- another agreement signed? This is a European question. And yes, it's difficult, of course, to disclose when you're negotiating, but yes, we're working the same way in Europe as we're doing within U.S. When we say that we -- our goal is in U.S. to have 10 hospital agreements closed. We, of course, already have a sales pipeline where we have progressed pretty far with enough of them so that we believe there is a great likelihood to meet that target. And it's the same thing with Europe. We have several ongoing discussions and negotiations, which make us pretty confident that we'll meet that target as well. And it will be also on those markets that you are mentioning here, the bigger ones like Spain, Germany, U.K. or France. U.K. or France are a little bit more difficult markets when it comes to pricing and biomarkers. So yes, we have looked at those as well, but we are prioritizing markets where we can get well paid reflecting the value of the product, and there's -- where the strongest demand and support is. So yes. So Helle will continue doing that as well. So thank you for all those questions. And there's actually additional -- there's a lot of questions to appreciate that. Someone regarding the capital injection, can you give us a timetable? Yes, we can. We will publish the prospectus later today. The subscription period will start tomorrow. It will run until the 13th of December. And then for the warrants, they will be open to be able to convert during September, I don't know the date, but September '24. And in the meantime, I understand they will also be tradable on the stock exchange until they are effective. Yes. See if we have more here. The management -- is the management team participating in the clinical trial. Yes, most of the management team members and also the Board of Directors members are participating. I think the details will be in the prospectus. I'm participating with SEK 10 million. I know Lars is participating with SEK 1 million. And yes, several other ones as well. So I'm very happy to see that. And you could say also that the biggest investment of all is done collectively by management in Sweden and the U.S. team because they are indirectly participating by giving up some of their -- or all of their cash out bonus for this fiscal year in order to get a bigger stake in equity. And so that's a huge commitment, which I'm very grateful for. And it was very important for my decision. I think how we will implement the hospitals, we have answered -- can you expect similar revenue growth in next quarter? Yes, we expect this trend to continue, and we see -- we expect to see effect of all those projects that we have agreed within the pharma services area and also the client bill contract that we have received some few samples, but we expect to receive a lot more now that we have that contract in place, yes. All right. Here, we have Marcus who is not happy with the share performance that has lost a lot of value over the last 10 years. Well, he's partly correct. I'm also not happy with -- I'm very happy with the development of our company. I think the way we progressed with met milestones from 510(k) clearance and onwards. I think it's a huge achievement, both -- in all 3 markets really. The U.S. milestones we talked about, the portfolio of pharma companies, the contracts we are making agreeing on the European market. All those I think, is huge achievements by the team. I think we have not been rewarded as well. Marcus says that we have not have a share price development positive during the latest 10 years. That's not 100% correct. We had a great share price development until starting of 2022 when the financial climate changed quite significantly. And despite our progress with 510(k) clearance, we were more affected, I think, with those external factors. And the question, I guess, is what are we going to do about it? Yes, we are going to make sure that we become less dependent on the financial market and generate revenue enough to be cash flow positive. And this -- that's why we laid out this plan, which includes cost savings in order to get to that milestone with as little capital as possible as the price for capital is very expensive right now. So that's a short answer to that one. All right. I think we need to be a little bit selective here because we're running out of time.

Too identical.

Yes, there's a lot of identical. The Scandinavian market. Can you talk about the Scandinavian market opportunity? Yes. I don't -- would you want to elaborate Helle. It's a market which has no reimbursement system really for diagnostics. So -- but it's important to get into the guideline. We have strong support from key opinion leaders that we would like to benefit on. And the price levels are compared to European levels on the higher side. Isn't that a good summary?

Yes. And I think the commercial partnership that we are entering, we are very strong in Sweden with key opinion leader network, and this will broaden it to Denmark, Norway and eventually also Finland and Iceland. So it is a very strong agreement with company rooted in Scandinavia.

All right. I think that has to be the last one. We are 2 minutes over time. I think I appreciate, it was a lot of questions. Appreciate it a lot. Thank you for all the interest. And we have just closed a quarter which we believe has been great progress for us, and we're looking forward to continue on that journey. Thank you very much for all the interest in our company. Thank you. Bye.