BRAIN Biotech AG (BNN.DE) Earnings Call Transcript & Summary

Good morning, everybody. I'd like to welcome you to the BRAIN 6M call today on May 28. My name is Michael Schneiders, I'm the Head of Investor Relations at BRAIN, and will lead you through the call. For your information, we will record this call now for later disposal if any investors have not been able to join. The speakers today will as usual be Adriaan Moelker, our CEO; and Lukas Linnig, our CFO. We have now put everybody on mute. And then we will unmute for the Q&A session. I hand over now to Adriaan Moelker to start the presentation.

Yes. Good morning, everybody, Adriaan Moelker here. Welcome to the call, and we have some exciting things to talk about, along with the -- some numbers that are maybe not as excellent as we would hope. But the blend of it all, I think, is a positive one. Let me start with the first content slide immediately in Page #3, which is about the new name. And as you've seen, we've changed the name, was approved in the -- as per our outlook, where I'm very pleased that this went through, because it is much more fitting the times, I thought, explaining the long name and not being able to find BRAIN even for certain investors in certain countries was an issue. And also, I would think that internally, this is important to show that we have a new management, a new start that there is a change. We do need change, as I've said to you before. And this is one of the elements that helps build that culture change. Even though we want to keep the things that are strong, we want to develop into another direction with the initiatives that we've already talked about. So the name change is part of that, BRAIN Biotech. Also, the tagline, Creating a #BiobasedFuture, is important. This tagline system allows us to be flexible in positioning the business in different segments. So call it BiobasedFuture, call it working on sugar replacement or in doing something for the environment. So the architecture is such that we can be flexible, yet always come back to the BRAIN Biotech theme. Next page then. I included this slide again for the simple reason that I'd like to reinforce the strategy, but also that it allows me to talk about some of the highlights of the Deutsche companies on the bottom. Let me start on the right. We're very pleased with the progress that is being achieved and Biocatalysts, they're doing really well. Capacity is being utilized very, very well, and we have good opportunities for the future. So very pleased with that. Life Biotech, Lukas is going to address later on, remains a problem child, if you like, but we are diligently working on all the topics. And I would hope and expect that, that will be successful and that we go upward from here on forward. BioSun, the recent acquisition in January in Florida, does extremely well. We'll talk about that later, but we're very happy with the acquisition, the transition. And hiring a new MD, John Monks, who is an industry veteran, a personal acquaintance of mine from earlier days, so we know what we get and with a massive experience in the enzyme industry in several companies. L.A. Schmitt. Finally, very pleased with the progress there as well. Of course, it's a small business, but the team in Ludvig stuff does a great job and looks like a very positive year. Then on the left, on BRAIN AnalytiCon and SolasCure are the good news that we already shared on SolasCure is that we're going to the first-in-human trials which is an important milestone. Unfortunately, it was delayed due to COVID, the clinics being shut for patients, but that's going forward, which I think is really good news. On AnalytiCon, we're sharing the great news today, and that's here in the next slide actually is on the Pharvaris deal. I'll come to that later. And on BRAIN, as Lukas will explain, we've had challenges on the Bioscience business, generating more business, improving the revenues and therefore, the profit. So we'll cover that later. Then on Pharvaris, next page. Pharvaris being a stock listed company on NASDAQ, recent IPO. And the basis of their business is the development at our daughter company, AnalytiCon Discovery in Potsdam for hereditary angioedema, a rare disease, but clearly, with a big market potential. AnalytiCon did a lot of the hard work for Pharvaris, and we've already captured several milestones in the past. We did not share that, but I can disclose that now. And more importantly, looking forward, we will be collecting more milestones. Now clearly, this is the pharma business. So we've been very, very prudent in risk adjusting the milestone payments going forward, knowing very well that pharma business inherently is a risky business. So we've done the risk adjustment very, very prudently, which makes this project a medium-sized project for us. But clearly, if and when the milestones are achieved, then it will go up substantially in terms of risk-adjusted NPV. The important thing here as well is we mentioned that on page -- let's see, Page 6, I think, the EUR 11.4 million milestone payments is one thing. If and when successful, we will be collecting license fees from commercial product after that. So dependent on success, this could be really nice. But again, we've taken a prudent view and risk-adjusted with the future cash flows substantially to where the project today is seen as a medium-sized project. So later on, I'll cover some of the portfolio thoughts, but I thought great news to share with you today. Let me hand over to Lukas for genome editing, where -- and the team here, Lukas is the point person for that.

Thank you very much, Aryan. And also, good morning from my side, Lukas Linnig here. Just one comment on Pharvaris because I also think that this is a very, very interesting project and the great success of our people in AnalytiCon. And I know these calls cover always very different topics. So if you are interested to find out more about that deal and also about Pharvaris, feel free to check out the Pharvaris website. And you will also find a lot of details about the contract with AnalytiCon and the exact deal and commitment we have with them in their prospectus. Just search for AnalytiCon in their perspective, and you'll find the details of the deal in more detail. Coming now to genome editing. I know that not everyone in this call has a chance to participate in the short call we have earlier this month, where we have announced that BRAIN has developed Non-Cas9 genome editing tool, which already works in selected bacteria, fungi and yeast. And as I'm aware that not all of you have been here, I'd like to reiterate some of the most important messages from that call. And this has a very high potential for BRAIN, but we also want to make the milestones transparent that we have in front of us. These 3 milestones are namely the next big things that we need to achieve are, first of all, to get IP granted, or first of all, we need to have more certainty that we will get IP granted. We need to verify and activate the technology to work in mammalian cells, because mammalian cells will be a much broader application field. And this would include, for example, therapeutics or the pharma space, which is, as you can easily imagine, a very big market for genome editing. And the third big milestone which would -- if our theories hold true would enable larger and bigger market for us would be to verify the mode of action. And as there is a couple of milestones, and it's, of course, always difficult to understand what does that really mean for BRAIN now, I'd also reiterate the economic view from our point of view, what that actually means. And I'd like to start with the worst case. And the good thing about the worst case is, essentially, that we can -- we believe that we can already achieve that with the technology today. So that is the good news. And in that worst case, we expect that we will be able to sell this technology as one of our USPs. And that we will be able to generate new TMS business with that. That would kind of be the business model we CRISPR for you. We expect that we can use the technology in strain development for our own use and, for example, Biocatalysts, but also potentially to out-licensed these strains. And we expect that we can use the technology for future new business development and new business development, and be quicker with that, because the genome editing phase in many of these projects will be much, much quicker. And although it's difficult to guide exact revenues which we can achieve with that, but we estimate that in the next couple of years, we will likely be able to achieve mid 7-digit revenues from -- in the TMS space in the worst case which I've just presented to you. In the best case, however, and as said, in that scenario, there's a couple of milestones we would need to hit. This would be a completely new business model for BRAIN with immense upside. And currently, we are working on different business models. And we work on a strategy around the whole CRISPR cost topic as we speak. And the thing I really like about CRISPR and our development is that it is essentially a platform technology where we can discuss or we can decide for each and every market how we want to approach it. There might be markets where we say we do it ourselves. There might be other markets where we might start joint ventures, or there might be markets where we just out-license because we say, this is not our field of expertise, and we cannot add value besides providing the platform. So this is why I like that technology very much and also the business models and ideas behind that. Also, I said in the last call, we are intending to structure an own company for that to be able to increase speed and agility for the development and also to keep all options open for us. And what is clear about the whole CRISPR field is that time will be of essence to become a real alternative to the existing genome editing systems. And some companies are out there which have been founded with 9-digit fundings over the last years, and therefore, we also believe that it will be important to fund these activities with the proper funding. And as I know that you always want to hear numbers, we believe that we will probably need around EUR 10 million to EUR 20 million in the next years to finance important R&D activities to reach these milestones or to get clarification on these milestones. Currently, to finance that, of course, we are evaluating all options. These include financing on the BRAIN AG level, but also financing the developments in a subsidiary with external investors. And the big question we are asking ourselves is, of course, when is the largest value inflection point? So at what point do we have the maximum value that we can create through milestones? And we will, of course, always act in the best interest of our shareholders. And therefore, we always like to take our investors' views into account as well. So if you have a specific view, please feel free to reach out to us. And we have had these discussions already on numerous roadshows and investor calls over the last weeks. For example, the Spring Conference or a Virtual Roadshow we had some time ago. But now as we have discussed a lot about genome editing, let me hand over to Aryan for a sec again to discuss the recent developments in the pipeline.

Thank you, Lukas. Yes. And the slide is the -- our incubator slide, focused new business development pipeline. I've mentioned this several times to you before. The key message is that we manage the pipeline very carefully quarter-by-quarter and assess the best opportunities for BRAIN. Things will go out. Things will come in. And as we said in the past, we're working on several key projects with -- that pass the feasibility stage. Now you know what we were talking about. Of course, this was dependent on success. And on both these Pharvaris and CRISPR, we did hit a milestone, and we were now able to talk about it. So new entrants come in. What you should also see is -- Lukas talked about CRISPR and how to develop a business model around it. The Pharvaris example is, of course, also very interesting. In other words, we will be looking to see how we can do more of that. And in other words, working with a partner, discovering compounds to treat rare diseases and to build on that model. Now it's much too early to talk about that, but clearly, this success has also called our attention. On the top left, you will also see that we will exit certain projects from the pipeline. That means if they're commercial, clearly, then they go off the pipeline. And for the 2 on the top, that is foreseen in the next, let's say, 6 to 9 months or something. Quickly on the right, the traffic light system, maybe commenting on the ones that are not green, natural fermented beverages, too. We're still waiting for the consumer trials, which is why we are half green, half yellow there. So it's about customer -- consumer testing. On Perillic Active, actually is reasonably positive. We've done trial fermentations. We're in a regulatory path there. Now the reasons on yellow is we're still looking what the best way, path to market is going to be. So reasonably optimistic there as well. The one on red here, gold from waste streams, we still do not have a risk-sharing paying partner. So that is one that is under scrutiny and that we will be looking to either move forward or to reprioritize in the next half year. That, I think, pretty much covers the pipeline in a very short space of time. Let me then hand back to Lukas for the financial highlights.

Thanks, Aryan. Looking at -- I'm on Slide 10 now, looking at the numbers of our first 6 months. One can see that in the 6-month period, our group revenues declined by 9.7%, which were mainly a result of our first quarter. If we look at our Q2 numbers, the Q2 revenues grew by 3.3%. And that I'd like to divide more in the segments. If we look at BioScience, we were still shrinking slightly at 5%, but this was a stabilization compared to the significant decrease we had in the first quarter. And as guided earlier in the first quarter, we were comparing to a pretty high base there in the first quarter of '19-'20. If we look at the BioIndustrial segment, we see a stronger segment, with a performance of plus 7% in the second quarter. However, the organic growth was only at 5 point -- negative 5.6%. And that was driven by different effects, which I'd like to explain in some more detail. As Aryan mentioned earlier already, Biocatalysts and L.A Schmitt have shown a very, very good performance and good growth. And I'll also talk about Biocatalysts a little later more as well. If we look at BRAIN Biotech, it continued to face issues also in Q2. However, we were able to manage the issues a little better. And the issues are getting more in control, and therefore, the shrinkage compared to the prior year quarter was lower than in Q1. And these effects, as outlined earlier, are also partly attributable to COVID-19 effects, especially in the wine and bioethanol sector. If we look at EBITDA, we see adjusted EBITDA at negative EUR 2.0 million compared to negative EUR 0.0 million prior year. Again, this is also mainly driven by the first quarter. If we look at Q2, we had a negative EUR 0.6 million compared to negative EUR 0.5 million last year, which was relatively stable. Some additional comments. First of all, BioSun first consolidation in the second quarter, consolidated from January 1 onwards. I'll go in a little more detail about BioSun in the later part of the presentation as well. And the same holds true for cash, which I'll go through in a second. Slide 11 and 12 are a graphical overview of what I've just explained. Therefore, I will skip these for the purpose of this presentation. Which brings me to Slide 13, showing the cash flow and cash position. If we look at the operating cash flow, we see a relatively stable performance at negative EUR 4.1 million. Our investing cash flow improved due to lower investments in the Biocatalysts production facility, as well as lower investments in capital increases in SolasCure, which were higher last year. The financing cash flow that you see is mainly driven by regular repayments of our loans, which we had used. If we look at equity, we see that despite the negative adjusted EBITDA, equity was overall stable, due to positive effects which came below EBITDA, which are namely a lower price for put option in Biocatalysts as well as the badwill, or as it is called an IFRS terms, gain on bargain purchase, which -- both of which I'll explain a little later as well. Cash position was overall as adequate, EUR 12 million. But please be aware that we bought out the Biocatalysts shares at EUR 4.5 million, which you will see in the cash flow of next quarter. That brings me to Slide 14, and I'd like to talk for a sec about Biocatalysts and our recent acquisition of new shares. As you can read, our stake increased by 16.7%. And for that stake, we paid GBP 3.9 million or EUR 4.5 million. And from my point of view or from our point of view, this was a very good result, as we were able to decrease the price significantly compared to what our liabilities and our expectations were. And as a result of that, we were able to release EUR 3 million, which were accounted for as financial income below EBITDA, which, as explained earlier, had a very positive effect on equity. There is a smaller part of the put call structure that remains in place. So from the 3 minority shareholders we have there, that had put call structures to exercise their options. So there's one party left that can still put or which we can still call. The operating business continues to develop very well. In the high single-digit growth is tied to COVID-19 effects and despite the Brexit. So the team in Cardiff has managed very well. We are very happy with the development. Plus, and which was actually a very positive surprise for us, which we honestly did not really expect, the fermenter, which has recently been commissioned, it's already almost fully utilized. And we are evaluating to pull forward the second phase of the capacity expansion to further accelerate future growth and margin improvement in Biocatalysts. So that is actually something which was a very positive surprise for us, which is, of course, always nice. Then coming to Slide 15, BioSun. On the top right, you see a picture of John. John, as Aryan mentioned earlier, our new Managing Director in the U.S. for BioSun. And the company so far is performing very well, despite the transition process to a new shareholder, which is, of course, always something which comes with a few hurdles, but is going very well. And also things are going well with the transition from the old Managing Director, Mark Messersmith, who is now going to retire at the end of June to, John Monks. So we are very pleased with the development there. We have also conducted the purchase price allocation already with regard to the transaction of BioSun. The purchase price was at EUR 0.5 million, including the acquired cash, with transaction costs of roughly EUR 100,000. And the result of the purchase price allocation indicates a gain on bargain purchase or also called badwill of EUR 0.9 million, which is accounted for in other income. However, as this is a one-off effect and we didn't want to inflate our adjusted EBITDA, we have, of course, adjusted that in -- or reconcile for that in our adjusted EBITDA. Now coming to Slide 16. Very quick, COVID-19 update. I think we have mentioned most of the things already in -- I guess it's not only us, but we are all very happy that cases overall are going down right now, especially in Germany. And we all hope that the crisis is going to come to an end soon. But if we look at BRAIN, we see some late cyclical effects of COVID-19, especially in like Biotech. And as Aryan mentioned earlier, it's something just much harder to get new contracts, to get new business done in the Tailor-Made Solutions business if you can't travel to the customers. And we all know that this is pretty difficult right now. Besides that, we are managing the operational challenges quite well. And we hope that in a couple of months or quarters, we can actually remove that slide at some point from our deck once the whole situation is over. Now coming to Slide 17, our targets. First of all, our mid-term guidance is unchanged. And the full year guidance is in line with our earlier statements. And it excludes CRISPR and investments in the CRISPR projects because these are, at this point, relatively hard to forecast. But therefore, we will disclose the investments in the coming quarters transparently, which we have made and will make in the project in order to make the guidance and also our numbers transparent for you. If we look at our updated guidance, you will see that we expect revenues to range between EUR 37 million and EUR 40 million for this fiscal year. And that depends on the closing of additional contracts in the Tailor-Made Solutions business as well as our sales volume in the enzyme space. Depending on where we are in that area, we expect a certain improvement of our EBITDA. Overall, an improvement is expected. Again, the extent of that improvement will depend on our actual level of revenues. Consequently, our BioScience segment is guided to be below prior year, as already guided earlier. And the BioIndustrial segment is likely to grow organically a little lower than originally expected from us based on the explained COVID-19 effect as well as the operational changes that we face in like Biotech. All other subsidiaries in BioIndustrial are expected to grow either at or above plan. And that brings me to the end of my presentation, and we will now open up for Q&A.

Perfect. Thank you very much, Aryan and Lukas, for presentation. We will now unmute the lines. Can I please ask you all to limitedly mute your line all a bit of a better noise comfort here on the call. So we will start now with the Q&A. And as a good transition -- tradition of fine start with the analyst first and this time as alphabetical order. So I would like to ask Markus Mayer from Baader Bank start with his question.

Hopefully, you won't hear too much background noise. I'm currently working from depletion. So I have 2 questions. The first one is on the salt taste enhancer. On the Capital Markets Day last year, you said the salt taste enhancer is in the prelaunch phase, and it's still there according to the presentation. Can you give us some update? Should we expect the launch phase to be then fulfilled this year? Or is it taking longer or also maybe due to COVID? That's my first question. And the second question is on this positive news here now today on this PHA121. Do you have further projects like this in the pipeline? Maybe some flavor on this would be helpful as well.

Thank you, Markus. I'm going to hand it over to Aryan here.

Yes. First on the Pharvaris 121. No, we don't have things to share there that are additional to that pipeline. I -- what I said before, I will restate this project, of course, is a very successful project. And we're looking to repeat that in the future on different bioactives, different compounds with maybe different partners. There's nothing we can share there. But clearly, a model like that is interesting and profitable. So we'll be looking to build on that with the learnings that we've got, but there are no concrete projects in the pipeline that I can share. On the salt taste enhancer, that is going to market. The partner there, the US-CPGC, is committed to bringing it to market. It is a question of when the launch actually is. You will appreciate that fast-moving consumer goods companies have a range of product launches, and it is somewhere in the queue to be launched. And we have to wait when that exactly is and they can pull a launch or they can accelerate the launch at any moment in time. We are in the back seat here. And we wait much like you to see when they actually commercialize. But the feedback from our partners is that this is imminent, let's say, end of 2020 -- what are we now? 2021. Okay?

Thank you. Let's move on to Falko Friedrichs from Deutsche Bank. Falko are you on the line?

Sorry. This is Jan Ford from Deutsche Bank speaking for Falko. I've got 3 questions, please. Firstly, can you update us on your current cash positions? At the end of March, you had EUR 12 million in cash. But as you mentioned, you also increased your stake in Biocatalysts. How sufficient is your cash balance to run the business over the next 12 months? Then secondly, on SolasCure. You mentioned that the Phase II clinical trials have started in the meantime. How are they progressing so far? And when do you expect them to be completed? And then a quick follow-up on SolasCure. In the past, you mentioned that you haven't yet decided whether you want to keep a major stake in SolasCure or whether you are willing to sell it. In view of the new investment opportunities, have you changed your mind in the meantime?

Aryan here. I'll first cover SolasCure and then I'll hand over to Lukas for the cash. On the first-in-human, the progress, it's too early to say. I mean we don't have the data yet. They're being tested. You have to imagine, I mean, you need patients with open wounds that have been infected, that need to be tested against their control. So that takes time. This phase will take approximately -- I think, it's 9 months before we go into the next phase, which is totally planned and expected. So we have a road map actually that we shared in the Capital Markets Day last year. And we're following that road map now, albeit with the delay, as I explained, due to the COVID pandemic. So the progress is good. We are in the clinics. It is as planned now. And we, of course, fully expect to be successful. On the stake in SolasCure, we're round about 40% now. We always evaluate what the best path forward is, where the inflection points might be and whether we should stay invested or not. At this stage of the game, it is very, very clear that we want to stay in that we are committed to SolasCure, that we continue to ride the journey. And of course, also as BRAIN AG and Zwingenberg, do work for SolasCure and build the business together with SolasCure. So that's unchanged, and we remain committed to that business.

Jan, this is Lukas. I would take the question on cash, obviously. Yes, you have mentioned the EUR 12 million cash position by the end of March. If you want to look at what we expect the remainder of the year or how we expect the remainder of the year to continue, I would think that Q2 are hopefully a little better. It could be a good assumption for the development of the remainder of the year, which is then, of course, also true for cash. What you also need to take into account however is the EUR 4.5 million we paid for the shares in Biocatalysts. And as we have always mentioned in the past, at a point in time where we need to pay for or where we need to buy out minority significantly, as we have done now, we need to consider financing options. And as mentioned earlier, we are considering these financing options. And it is not a decision on -- it's not just a singular decision. As Aryan said, we are always reflecting, when shall we invest in SolasCure? Should we now or should we not? Should we let ourselves dilute? The same question is true for BC. To what extent do we want to invest? To what extent do we want to commit for a project where we believe in? Therefore, all these things are coming together. And we are evaluating options to cover all these different angles, which we believe are very critical for our business.

Thank you. I'd like to move on with DZ Bank and Peter Spengler.

I have some financial questions left actually. First is on the adjusted EBITDA guidance. So you kept your guidance. But when you look at the first half of the year, then you need a lot of fantasy to see this happen. So what is your idea? And what can you tell us? When will the turnaround come in the second half and -- to reach the guidance? Then on the other operating income in BioIndustrial, maybe you can also share some thoughts how this will develop because there's volatility in the first half. And then on the -- maybe I missed it, maybe you can tell us something about the financial income in the second quarter, the EUR 3 million. What is it based on? And how will the financial income develop in the second half? So basically, all questions about the second semester.

Sure. And I am, of course, happy to take all these 3 questions. Starting with the easiest one first, which is the financial income. I've tried to explain that. The EUR 3 million that you see relate to the lower payment we needed to make to buy out the minorities in Biocatalyst. Or to put it differently, we had expected a much higher payment for the shares we now bought out. But as we were relatively successful in agreeing on a good price and for the shares, we were able to release EUR 3 million in liabilities, which were then accounted for as financial income, financial profit in the P&L. And I, of course, not expect that to happen in the second quarter again because I don't expect the put options to be -- the remainder of the put options to be exercised in the second quarter, as they can only be exercised in the first 3 months of the year. Getting to your first point. I think there's some small clarification to do. Our guidance relates to the EBITDA, not the adjusted EBITDA. This is the first point. However, the other bit that needs to be considered is that our numbers, of course, already include some investment in the CRISPR project, which we are, as I said earlier, going to more transparently communicate also in future quarters. So that will make -- that will clear up a couple of things probably as well. And looking at BioIndustrial, I think it's easier to comment on the individual bids. I expect Biocatalysts and L.A. Schmitt as well as BioSun to continue very well as they have done for the first half year. If we look at Biotech, I am confident that we can get the issues more and more under control. It will be difficult to get Biotech a profitable business this year. And I don't expect that we can reach profitability in Biotech for this year. However, we do see that we were able to stabilize the problems we had. And from there on, we expect that once COVID is less an issue, we will be able to increase sales again to also be able to be profitable with Biotech again. I hope that answers your question.

Thank you. And I'd like to continue with Mohamad Vaseghi from FMR. If you are on the line? Mohamad, are you there? If not, then last but not least, please, Christian Ehmann from Warburg.

So I'm afraid I have to reask the question because I had to -- I had some reception difficulties on my end, on the liquidity position. So what exactly is the liquidity position? And also, what are the estimated costs to close the remaining options for Biocatalysts? And the second question would be, you mentioned that salt taste enhancer and natural beverages, fermented beverages one will exit the pipeline in the next 12 months. So do you expect some milestones which can be booked in this regard for the remaining fiscal year? And the third question, what is the clinical time line on PHA121? When can we expect a market entry? Or what is the planning here? And also, what would be a good royalty assumption for our models in this regard if the project would reach the market?

Yes. Let me first address the -- the fermented beverages one in the salt. No milestones expected. This is going to be as planned in -- natural fermented beverages is a product sale. And in salt, that would be a royalty base, plus sale. On -- what was the other one, is Pharvaris, the Pharvaris 121. I think in the deck, we've got the milestone payments is there what has been achieved already is in the deck what is there going forward. Actually, you can find that on the Pharvaris website without any problem. So not making a mistake here on the milestone. It is very transparent and the Pharvaris -- in the Pharvaris announcement. On the royalty agreement, it's a low to medium single-digit after market launch. It's actually in the deck, Page 6. So that's -- on a product like that is very substantial possibly when and if that goes to market. So it's very transparent, as I said, go to the Pharvaris website. But if you can't find it, we'll be happy to give you those data.

Maybe one additional comment from my side on the Pharvaris deal and how to evaluate that. Pharvaris has 3 developments. One of them is in the clinical Phase IIa right now. However, the great thing for us is that all of these 3 developments are based on the same product which has been developed by AnalytiCon. So if these products or one of these products get to market, we will get substantial cash flow from that. And if you look at Pharvaris there, their share price has gone down now a little bit, but they have been over EUR 1 billion at some point. And we are now at somewhere, I think, EUR 650 million, EUR 700 million valuation of Pharvaris. And if we just look at it and say, "hey, this is this -- the valuation is essentially a free cash flow estimation calculated backwards to today". And we are essentially owning a low to mid-single-digit royalty on their revenues, that is quite substantial for us. Again, in the past, we didn't want to communicate about the project yet because it was too early, and we didn't want to make promises. And again, it's pharma, it can always be killed. But there is people out there that really believe in that project and that are willing to pay pretty high 9-digit valuation. But as Aryan said, if you want more information, the prospectus is a great source for the business model as well as information about the exact deal between BRAIN, AnalytiCon and Pharvaris. You can actually find the complete contract online, I believe, with some blanks. If you -- to your question regarding liquidity. Our cash position was at roughly EUR 12 million end of March. And we expect that the second quarter -- or hopefully a little bit better is a good indicator for the remainder of the year. So therefore, also from a cash flow perspective, that cash burn is -- could be assumed. And from the EUR 12 million, you also have to deduct the EUR 4.5 million that we paid for the put option in Biocatalysts. And to answer the question that you really want to ask. If we need financing, I think, as we've always said, we will need financing when put options are exercised. However, we see this in a bigger context of investing potentially in SolasCure, investing potentially in the CRISPR project. And all these options, we are weighing against each other, alongside with looking at all the different possibilities we have in terms of financing. And the last question was -- you asked about what we expect the remaining put options to cost us, if I'm not mistaken. And if you do the simple math, that we expected to essentially pay EUR 7.5 million from the percentages that are still outstanding in that put option, I think the remainder in the liabilities in our balance sheet is somewhere between EUR 4 million and EUR 4.5 million. And we -- it will be, of course, dependent on the development of the company and our ability to come to get a good price here. However, this is what we will -- what we still have as expectation in our balance sheet as liabilities.

So I think we are through the questions. Are there any remaining questions on the call? Well, if not, then thank you very much for your participation. We will have our 9-month figures in August 30. And I wish you a good weekend. Thank you very much.