Clinuvel Pharmaceuticals Limited (CUV) Earnings Call Transcript & Summary

Good morning, ladies and gentlemen. My name is Jeffrey Rosenfeld. I have the privilege of being the Chair of Clinuvel Pharmaceuticals Limited. As Chair of today's meeting, it is my pleasure to welcome you to Clinuvel's 2024 Annual General Meeting. This includes all who are assembled here in Melbourne, as well as viewers of the live stream of the meeting. I note that we have complied with the relevant requirements for convening this meeting and that a quorum is present. As the time is now 9:30 in Melbourne, I formally declare the meeting open. Before the formal business of the meeting, I'd like to acknowledge the traditional owners of the land on which we meet today. I would also like to pay respects to elders past and present and celebrate the diversity of aboriginal peoples and their ongoing cultures and connections to the lands and waters of Australia. I also draw your attention to our legal notice, which highlights there are risks, which can impact the plans and initiatives we will be discussing today. I'm joined by my fellow nonexecutive directors, including our 3 new nonexecutive directors: Mrs. Brenda Shanahan, Dr. Karen Agersborg, Mrs. Susan Smith, Mr. Matthew Pringle, Mr. Guy van Dievoet, and Dr. Pearl Grimes. I would also like to welcome our Managing Director and CEO, Dr. Philippe Wolgen; our Chief Operating Officer, Mr. Lachlan Hay; our Chief Financial Officer, Mr. Peter Vaughan; Our Head of Investor Relations, Mr. Malcolm Bull; and our Company Secretary, Ms. Claire Newstead-Sinclair. The company's auditors, Grant Thornton, are represented here today by partner, Mr. Michael Cunningham. The auditors will be available to answer questions during item 1 of the agenda or at the end of the presentations regarding the conduct of the audit and the audit report for the year ended 30th of June 2024. Finally, I would like to welcome representatives from our share registry, Computershare, who are present today. The notice of meeting has been given in accordance with the company's constitution, and copies are available for you on the company's website, the Australian Stock Exchange announcements platform and at the share registries registration desk. I will take the notice of meeting and explanatory statement as read. The format of today's meeting will be a Chair's address from myself, the Managing Director's presentation, including a focus on vitiligo with Dr. Pearl Grimes, and we will also have Melissa Benson of Wilsons Advisory asking questions regarding vitiligo. A Q&A session hosted by Mark Pachacz of Bioshares will follow and then a formal consideration of the business on today's agenda with an opportunity to ask questions on the formal business. And finally, questions from the floor and completion of the poll on the formal items of business. I note that we are aiming to conclude today's meeting by 11:30 due to venue requirements. Shareholders will be able to ask questions and cast votes at the appropriate times whilst the meeting is in progress. Before we commence with the formal business of the meeting, I will now provide my opening Chairman's address. It's my great pleasure to welcome shareholders to our 2024 AGM. This is a valuable opportunity to review our past performance and future plans. I will begin by highlighting the indisputable success of our last financial year. It is the strongest since Clinuvel listed almost 25 years ago. We developed and commercialized SCENESSE, a breakthrough drug for the rare unmet condition EPP. Now we are evolving from a successful profitable company with a single therapy into a diversified global biopharmaceutical company at the frontier of photomedicine. To do this, we are building a sustainable long-term future with multiple revenue streams. We are investigating how our pioneering melanocortin technology can treat a wider range of medical indications. This includes vitiligo, a condition with few effective treatments, which affects up to 2% of the global population. Indeed, 1% to 2% of all those who live in the United States of America. So we're talking about a lot of people. As we are devoted to transforming skin health in the broader sense, we are also developing PhotoCosmetics. This ambitious new venture will mark the first time that melanocortins enter the world of luxury skin care. We will transform skin health and disrupt the premium cosmetics industry in the process. I see decision-making as central to the success of our business. It is a topic with personal resonance, too. During my 40-year career as a world-leading neurosurgeon, I have tended to patients with life-threatening brain and spine diseases. As a major general and military surgeon, I operated on gravely injured soldiers in the field and as the Inaugural Director of the Monash Institute of Medical Engineering, it was my job to make a call on whether newly invented medical technology could thrive beyond the lab in the marketplace. All that is to say I have made innumerable critical decisions in my professional life. Since January, I have used these carefully honed skills to lead this board. I would like to emphasize that Clinuvel's rise is solely down to the decisions taken by the Board and management. You can have the most innovative technology in the world, but it will go nowhere without the right people and the vision to ensure that it succeeds. As a Board, we have information at our fingertips that no one else has, outside the company that is. This unique intelligence informs the decisions made daily by a handpicked senior team, whose job it is to solve complex issues and ensure the company's continued growth. It is their bold, at times, even counterintuitive solutions that have helped Clinuvel weather difficult periods over the past 20 or so years. The result has been 2 decades of success. This transition has been driven, in large part, by the commitment and expertise of our CEO, Dr. Philippe Wolgen. He has shaped Clinuvel's path forward and has tirelessly worked with the Board, senior management and the entire company. When you invest in Clinuvel, you are not only investing in our business, you are also investing in our people. In the knowledge and skills that they bring to the company. The majority of our shareholders understand this and trust management to keep the company on track, investing in a team that resurrected the company and led it to profitability. I would like to also point out that the Board has no obligation to disclose the deliberation behind every decision. This is true for any leadership team striving to better a public company in a competitive environment. There are some investors who are vocal about their disappointment with the share price. However, no board has direct control over share price nor should its sole focus beyond moving these prices. Our share buyback program is helping to support the share price, though as other companies experiences show, the boosting effect may be short-lived. Unfortunately, Clinuvel has about 25 anonymous posters who incessantly criticize all aspects of our operations and our financial results. Despite this campaign of digital disruption, most of these investors have reaped returns from Clinuvel's stock over the last 15 years. They are neither experts in our business nor in the field. The battle they are waging against Clinuvel from their keyboard is bad for themselves, the business and all shareholders, which begs the question, if they are so unhappy, why do they not sell their shares? I urge you not to be swayed by their vitriolic misinformed posts and vote for continuity, stability and future potential. That will provide the surest path to Clinuvel's continued success. All the resolutions today are about placing your trust in us, in the knowledge that we will make decisions in the best interest of shareholders. Clinuvel is going from strength to strength. The glowing financial results of financial year '24 are a testament to this fact. We have a robust commercial operation, treating EPP patients in Europe and North America. These are growth areas. In both markets, the number of patients we are treating have increased year-on-year. We're also looking to expand the market to Canada and South America, that market. For 8 consecutive years, we have steered the company through annual growth in revenues, profit and cash reserves. This upward trajectory continued in 2024. I would also draw your attention to our peer-leading metrics. Our earnings per share and return on equity are metrics, many of our peers would envy. Earnings per share, $0.715 per share. In 2024, diluted $0.698 per share, return on equity, 17.6% in 2024. Clinuvel is self-sufficient. By that, I mean that we have enough money to self-fund our own R&D, research and development. This gives us the freedom to decide when, where and how to reinvest our sizable profits after tax, now worth AUD 35.6 million, a cash reserve worth AUD 183.9 million, the largest sum in Clinuvel's history, and higher than that now, is financing our expansion into new markets. We are actively considering mergers and acquisitions. On behalf of the Board, I wish to acknowledge the Clinuvel team for their dedicated efforts. Our robust financial position is the engine of our future growth, enabling us to deliver on our key objectives. When I became Chair earlier this year, I prioritized expanding the Board and diversifying the skill set of its members. They must be equipped with the knowledge and capabilities to lead us into the future. As part of this process, the Board undertook an extensive, external-led review. It is my pleasure to welcome 3 experienced professionals with diverse backgrounds who can complement the 3 -- so -- who complement the existing directors, Mr. Matthew Pringle, Mr. Guy van Dievoet and Dr. Pearl Grimes step into their roles as nonexecutive directors. We will harness new skills across finance, accounting, governance, mergers and acquisitions and dermatology. And Dr. Grimes is a world-leading specialist in vitiligo. They will bolster Clinuvel's talent, knowledge and connectivity and help secure long-term stability. We also say farewell to one of our valued directors, Mrs. Brenda Shanahan, who steps down today after 17 years on the Board. I wish to express my sincere gratitude to Brenda on behalf of both myself and the Board. 17 years of service to any endeavor is commendable, but Brenda's commitment to the Clinuvel company, and our vision has been truly remarkable. Her in-depth knowledge of both Clinuvel's journey and Australian capital markets has guided many of the decisions taken at Board level over the years, and Brenda leaves having made her mark on Clinuvel. In my recent Chair's letter, I wrote that Clinuvel market capitalization does not reflect the value that we are building nor our future prospects. The company is not alone in this regard. With recent fluctuations in global markets, the valuations of many biotech and life science companies are fluctuating. To allay any doubts. I would remind you that Clinuvel is in a better position than most of its peers. We are -- some of the very -- we are one of very few biopharmaceutical companies to have developed a new therapy, achieve regulatory approval in the U.S. and Europe and have successfully marketed a product. These strong foundations are just the start. The board takes the view that the preferred way to grow the business is through the expansion of melanocortin products for both therapeutic and PhotoCosmetic applications. Seven independent analysts also agree that our efforts to unearth new sources of income look promising. To keep up easily with our new developments, I would direct you towards our rejuvenated social media accounts, both our Investor Relations and Communications, Branding and Marketing teams are really sharing content about Clinuvel's progress, which is reaching diverse audiences. We have more coverage by analysts, investor briefings and webinars, non-deal roadshows, conference attendances and presentations. This year, we have gradually ramped up social media campaigns and intend to step up these plans in 2024. Together, these will increase Clinuvel's prominence and visibility. This is important, not only for PhotoCosmetics, but also for our pharmaceutical presence. These efforts are key to Clinuvel becoming a household name. Several existing shareholders have increased their holdings in the past year, while new institutional holders have also joined our register. This diversifies and strengthens Clinuvel's ownership. We know that our business has global appeal and are heartened to see the bulk of our shareholders are split between Europe, North America and Australia. We wish to maintain this geographical spread. I think those who have already been in contact to express their support for our long-term plans, your messages are welcome. I would urge any shareholder who has been critical to look at Clinuvel with fresh eyes. And I hope you see what I and many others see, a vibrant, innovative, nimble, profitable company without debt and with the ability to take advantage of its substantial cash reserves. I believe our strategies for future growth and success warrant strong shareholder support. The winds of change are blowing across Clinuvel. We have been on a recruiting spree in the last 12 months, adding a new Chief Financial Officer, Mr. Peter Vaughan. And I note Mr. Darren Keamy, our previous Chief Financial Officer, is in the room. Good to see you, Darren. We miss you. A new Director of Global Clinical Affairs, Dr. Emilie Rodenburger, who has returned to the company, and our Company Secretary, Ms. Claire Newstead-Sinclair. I wish to, again, thank our Managing Director and CEO, Dr. Philippe Wolgen for his superb management of the company. He has kindly agreed to a 1-year extension of his employment contract. While we are certain that he wishes to step down, we must accept his motivations. Between now and the 30th of June '26, we will secure the services of a new CEO, ensuring a smooth handover before Philippe's tenure concludes. The search is beginning. For his part, I know Philippe is energized and committed to advance the company's key objectives to round out his leadership of Clinuvel. I must say the global team and the Board are right behind him. As we welcome 3 new nonexecutive directors, I also want to express my appreciation of the dedication of Mrs. Shanahan, Mrs. Smith, and Dr. Agersborg for their unwavering commitment to Clinuvel over the last -- the past year. In conclusion, a bright future lies ahead for Clinuvel. We are building a diversified portfolio of melanocortins and formulations, which will stand the test of time in terms of sustainability and the provision of treatments for those in need. Looking after both patients and those who desire advanced skin care is the driving force for the company, providing long-term care and constructing close relationships with end users is an integral part of our culture, so is our commitment to add value for our shareholders. Further major changes will be made under my watch. We are determined to maneuver the company into a position where we can capitalize on SCENESSE, PRÉNUMBRA and the ACTH product, NEURACTHEL. By seizing these opportunities, we will multiply the company's current value. I am -- based on the information we have received and prevailing market benchmarks, I am confident that the share price will climb once again. That said, we will not let others' fascination with share price distract us from our cause, nor from achieving the goals we have set ourselves. I hope you see why I and many others in this room believe in Clinuvel. I believe our strategies for future growth and success warrant strong shareholder support. I have no doubt whatsoever that in its current form, Clinuvel will continue to excel, disrupt and be seen as a beacon of innovation in our industry. Thank you for your attention, and now let us celebrate the success of Clinuvel and the achievement of the past year. Thank you. I would like to now hand over to Dr. Wolgen to provide his Managing Director's address. This will feature vitiligo with Dr. Pearl Grimes and Mr. Lachlan Hay, and questions will be taken from Melissa Benson of Wilsons Advisory. Thank you, Philippe.

Ladies and gentlemen, good morning. It's a pleasure seeing you, particularly the attendees from overseas, from the U.S. We very much appreciate the effort that you made to come here and we appreciate the fact that you committed to the company. I also would like to welcome the 2 analysts that have followed the company and I always make special mention the fact that you keep covering and researching us in the middle of the night. It's well appreciated. Now today, we are going to change the structure of this presentation very much owing to you, because we had a number of persistent and recurrent questions about ownership, pricing, and the technology, but also the future of the company. So this is by no means a strategic update, but a format where we answer some of your questions that have been expressed. I make it no habit for executives, for managing directors to talk about pricing and value. But given the recurrent questions, I think we will address it today. Now in the vicissitude of the Australian markets, the question that was pertinent is how does Clinuvel behave in Australia, but also internationally. And I'm going to share with you what we found and it's actually owing to you that we did this research, due to the questions and expressions in the e-mails and the phone calls. So let us start. At this very place last year, we talked about the construct that we're progressing towards, and that's the house of melanocortins, and that would make the company unique in the world, the only entity that -- to our knowledge, that is focusing on one group of hormones, melanocortins. And I will not go through each indication, because we've done this now in the various public expressions. But what is new to you is our sharing in the middle column of the probabilities that we assign in-house to the various programs at the various stages. And it's by no means a financial guidance, but it does aid our decision-making when we allocate resources towards programs. And what I would like to -- for you to take away today is that you have an approved and new molecular entity that went to the same regulatory hands and decision-makers, including insurers which is now repurposed at a different dosing interval, but at the very same dosing for the largest market, Vitiligo. And so when we deliberate in-house, it is quite clear that the risk of launching NMEs, new chemical or new molecular entities in 2010 or 2012, when you first address the global regulators, that, that risk is significantly decreased. When you come back to the same decision makers, the same people in Silver Spring and now Amsterdam with a new entity, a new disease entity that is being repurposed by the drug, and so hence, the probability assessment assignments that we share with you today. Now what is unique about Clinuvel is that we understood the global demand for the melanocortins and we translated the technology know-how into PhotoCosmetics. And they came in 3, in polychromatic, the photoprotection line, the P1 line, the M1 line, which is the medical tanning or the self -- the sunless tanning proposition and the assisted DNA repair line. Now pivotal, as you will hear today, to success in PhotoCosmetics, which is an entirely different market than pharmaceuticals, is visibility, is marketing, and that comes in the form of social media. Now in order to make an assessment whether you want to progress and allocate resources towards these new markets, you need pilot studies that give you the confidence, the evidence and the data that you're actually on the right track, and we'll share that with you today. So in a nutshell, the way we and I particularly see the business is we develop and realize controversial scientific ideas over time. In order to protect you, shareholders, against the risk, we need cash buffers, cyclical or countercyclical cash buffers to navigate these journeys. Now another question that is repetitive is the ownership of Clinuvel and whether the company is attracting sufficient institutional shareholders and whether we put sufficient attention to that group of institutional holders. And we quantify almost everything we do in the company. And if you look at the jump year-on-year, from '23 to '25, a number of activities that both investor managers, [ Mr. Wu ], And since recently, we appointed our first U.S. manager, Mr. [ Miles Clausen ], you see a significant jump in one-on-one meetings, in road shows, in contacts with analysts. And I need to say on that front that we regularly speak to all the 9 analysts in the world, at least quarterly when we have news flow. So how does that result in the ownership of the company? Well, in general, we jumped from 39% to 16% of international issued capital. And in terms of institutions, the biggest jump was actually seen from Australian institutions buying on market. And the total of issued capital means that we have 32% of the institutions are holding the stock at Clinuvel and that it's throughout comparable to the benchmarks in Australia. So if we look at the historical pricing development of Clinuvel, there are really 5 peaks that I want to draw your attention. And this discussion today is so much about the future and the prospect of Clinuvel. And when I talk about the historical context and the pricing that occurred in the past, it indicates that we have full confidence that these peaks will reoccur in the future. And this is not a forward guidance that I'm giving you. This is based on the analytics that I'm going to share with you. Now the first peak that we saw in Clinuvel occurred in 2007 and that was instigated by the buying of 1 fund manager in Europe that promoted the company openly. But as fast as the ascent of the company was seen in 2007, it came down within 6 weeks from $14 to the equivalent of $0.90. There was no news flow underlying that peak. The second peak was seen in 2014, 3 months before the European Medicines Authority made the value decision, a binary decision, either to prove or to reject the drug. And 3 months prior to that decision, an opportunistic bid came from an Albanian fund manager, who was later jailed for securities fraud and the peak came down. But from that moment, the attention was made for Clinuvel and you see a slow ascent to the all-encompassing decision in October 2019 when the FDA had to, for the first time, review the dossier. And on the 9th of October 2019, we saw a peak to $44 equivalent of $2.2 billion market cap, with the prospect of a U.S. market. It was due to 1 buyer that we peaked on that day and that 1 buyer sold out 3 months later and you see that the graph comes down. Now the fourth peak occurred in September 2021, owing to 2 buyers that drove up the stock. And as fast as it went up, it went down. And then the last peak was also due to 1 institutional buyer in January 2023. So where are we today? Now when we superimpose the status, the condition of the company at the various 5 peaks, it's quite obvious that we had no pipeline in 2007, but we reached a market cap of $200 million. We had very limited prospects in 2014 of enlarging the pipeline because we didn't have the cash to do so. The cash was raised through a number of capital raises, 2 of them at premium. And in 2019, when we reached zenith with the FDA approval, we had $54 million in cash, mainly generated from European sales. And so what you see when you look longitudinally is that the pipeline and the assets have grown, but slowly, the price declined. And so that prompted us, certainly spurred by your questions to find the objectivity in the answer is, is the price and value related to each other? Is there any correlation at our end of the market? And so what our teams did, and that is the, I would say, benefit of integrating all your functions in-house, you surround yourself with statisticians and market analysts, and we've got now 5 of them that are doing this kind of work. And we reviewed the Russell 3000, which is really a capitalization-weighted market index in the U.S. with the 3,000 companies. We looked at NASDAQ Biotech Index and the Euronext. And in the pool of 3,502 companies, we found 110 biopharmaceuticals that were profitable. And so that's a very low percentage. But how do we, Clinuvel, compare to these 110? So we made a man-made demarcation, a distinction between those companies that are worth more than $5 billion and those companies that are worth less than $5 billion. But that wasn't enough, because in order to compare apples with apples, we know that we are in the lowest category, which is at the market we're trading at, a value of lower than $1 billion. And what you see then is if we compare ourselves to the profitable companies, 110, the second filter that you superimpose is, well, how do we stack up to these companies that have at least a 7 years earnings growth? Now as you know, we have an 8 years earnings growth, but from Bloomberg and FactSet, the data set does only give you 7 years. So then you realize that the company that belongs to these 2 categories, less than 30 that have 7 years earnings growth, it's less than 13 biopharmaceuticals in the European and U.S. markets that have an earnings growth, that the company stacks up as one of the very few, 1 out of 65. So the question then became is price, that we see now, and we do that for our own sake, not only to satisfy the answers that you posed to us, but we generally want to know the answer, is price and value in biopharmaceuticals, and those companies that have won multiple or platform, are these prices and value related? So we looked first at the companies of $5 billion and more and then the companies of $5 billion and less. On the left-hand side for you, those companies that are worth $5 billion and more, so biopharmaceuticals that are profitable. And we looked at the correlation in the independent variable, the earnings growth and the dependent variable is the market value. So market value, as you know, is the 2 components of outstanding shares multiplied by the price. And what you see there is that the correlation expressed in Spearman coefficient of 0.23 is very weak. So the relation between market value and earnings growth in companies larger than $5 billion is weak. Now how is it for those companies of $5 billion and less market cap? Well, that's even weaker. Then we asked ourselves, well, how is it for those companies with a market cap of larger and smaller than $5 billion, how is the earnings growth of 7 years? Well, then you see that was in these 2 graphs, a negative correlation between those companies that are larger than $5 billion and an almost insignificant correlation between those with a market cap of less than $5 billion. So what does that mean in lay terms? It means, in lay terms, that those companies belonging to the category of $5 billion or more and $1 billion or more have no relationship between price and value. Now that was an epiphany for us, because we were chasing, with all our activities, a price. But the reality is that the pricing and value are randomly distributed in these companies. So in order to highlight to our owners what we do on an annual basis, and that is a financial year end, December -- of June to July, we published the catalysts, the events, the objectives, the key performance indicators that the entire team brings together and is working towards. And last year, we had 16 of our objectives. Five of them have not yet been met, are ongoing until the 31st of December and 5 have been carried over to the catalyst of 2025. And what you see here from #1 to #8 are all these objectives that are related to the clinical activities and the objective 9 to 13 are either in development or financial. Now the colloquial proverb that biotech has a lot going on behind the scenes certainly holds true for us. And the tip of the iceberg normally represents 10% of 12% of the mass, and the rest of the mass of the iceberg is immersed underwater, and the same is Clinuvel. Now the question then comes, why is that so? The first reason is because we keep our competitors at bay, and competitors in our industry is fierce. While fierce it is, well, people are reading and scrolling through your patents, turning to your publications. And we see that our prospective competitors are using our information, our market data and so forth. Now that causes a symmetry between what we know and what you probably will not know. So I would say that 10% to 12% of the news flow and activities that Clinuvel engages in is known to us, and 80% unfortunately, cannot be shared with the market. And if you think on the journey that we took you on for the last 2 decades, we started off with a molecule that was formulated by us in a very specific formulation, so specific that there's only one manufacturer in the world able and willing to do it. And from this one, we learned how to use the drug in man. In other words, in a systemic formulation, we understood how to release the product in order to get maximum efficacy, but also the minimum safety issues. And from then on, we derived the notion that if we could inject SCENESSE as a solid, controlled release formulation, what's so unique was single-minded, found in 1 facility in the U.S. We could also translate it to a liquid injection with more and wider applications. From that knowledge, our teams derived, well, if we can do it with 1 molecule, could we also do it with an existing molecule that is generic but that is a much larger application and that is the ACTH or NEURACTHEL. In the entire constellation of a company where you engage in development, a Board and management have to make the decision how much risk do you want to compound in the company? Well, if there was already operational and financial risk and if you think back on the successful or the small pool of successful companies in the world, the answer has to be, given the history of this company, that you will have to compound the minimum amount of risk to make it to the finishing line. And so this concentric expansion to go from SCENESSE implant to an aqueous solution to the next set of molecules belonging to the same family and translating these molecules in smaller molecules in PhotoCosmetics makes sense in terms of risk management and covering risk as opposed to house various products, which are not related to each other under 1 house. Now the last part of the value chain that we missed is manufacturing, the in-house manufacturing that would make it cost effective and provide the company full control of its product. And now we come to a very important topic, and some of you have asked the question -- well a few questions have been posed to us. The first question was repetitively, but how is it that the company reassumes a program that had stopped 10 years ago and why? Well, the first reason is because the market wasn't ready. And what does it mean? Well, that is very old, owing and unique to Clinuvel. We will stop programs if there is no commercial reality for a product or drug in development, irrespective how good the drug is behaving in the clinic, meaning safe or effective. If a drug does not meet commercial reality and that is to the chagrin of Dr. Pearl Grimes and her colleagues, but if the FDA is not inclined to approve a drug because it doesn't recognize a disorder, or if we, in the primary market research, discover that insurers are not ready to reimburse a product and a prospective candidate on the market, we will stop the program. And that is pretty unique in the decision-making of the company. But since 2020, the market opened up where both the FDA recognized vitiligo as a severe disease entity and no longer as a cosmetic disorder and that the insurers were willing to reimburse it. And from that moment on, we resumed the program. Now what is unique about Clinuvel, and I'm going to take you in an intellectual journey and take your time to think about it. Vitiligo is unique in that the symptomatology is visible. People are losing their constitutive complexion and skin color. So the negative, losing your skin color as a symptom, becomes visible. What is unique about the treatment that we offer is that the treatment effect must provoke a positive. We are not getting rid or eliminating the symptoms. We're bringing back to skin color and that is a new paradigm also for the FDA and the EMA to review. So with that said, I think I'd like to call Dr. Grimes to the podium. A short introduction to Dr. Grimes before she is hopefully elected as Director to the Board. Dr. Grimes is one of the physicians that you meet on the journey, professor at UCLA, has established her name in vitiligo. And in every medical specialty, you will come across 10 global world experts. And then there is a binary decision from the physicians to be made when the company approaches them and the physician, and I assume that is what happened to you, we've never talked about it in that sense, is -- has the choice to investigate the drug candidate. And the best a company can hope for is that the physician becomes convinced, compelled to support a program. And we call that a scientific and innate belief. And it was quite clear that when we met Dr. Grimes, who made her career, devoted her life to pigmentary disorders and vitiligo, that she had to believe in the pool of drugs. And so it's a privilege, after 15 years meeting, for you to join the stage and join our Board. This is forward, so I'll leave you.

Good morning to everyone. It is truly my honor to be a part of the Clinuvel team. And as Dr. Wolgen mentioned, I really have spent the last 44 years of my dermatologic profession, devoting the majority of my time to investigating the science, the pathogenesis and the treatment of vitiligo and moving it forward and establishing new paradigms in how this disease is seen in the house of dermatology and the house of medicine. And we really have made substantial advances during my journey. It has taken me from making homemade phototherapy units to where we are today in looking at a new paradigm of new treatments for this condition. So what I'd like to do in the next few minutes is take you through a new treatment algorithm for vitiligo. As Dr. Rosenfeld mentioned, if we go around the globe and look at the frequency or incidence of the Vitiligo, most studies suggest that it affects 1% to 2% of the population. It has an equal incidence in all racial ethnic groups, but all the data suggests that the burden of disease or the psychological devastation is much more substantial in darker racial ethnic groups and I'll expand on this a little bit later. We divide the disease into 2 types: Segmental, which usually affects about 10% of patients; whereas the majority of individuals have generalized disease, and that generalized involvement can affect the face, the trunk, upper and lower extremities and the severity may vary from individual to individual. If we look at our global database, I think we can make the statement that probably about 55%, 65% of patients will have limited involvement and our data suggests that -- and we just examined the data from over 1,000 patients at our research center, about 25% of the individuals will have greater than 10% involvement. And that 10% encompasses individuals with generalized disease. Certainly, if you look at treatment paradigms, we can treat individuals who have limited disease with topical modalities such as our topical corticosteroids, the calcineurin inhibitors, but we're in a new age now where we really are looking at treatments for that 25% of individuals who have more generalized or extensive disease. If you look at those individuals who have comorbid disorders, it occurs in about 20%, and we don't have any data which suggests that comorbid diseases impact our therapeutic outcomes. Recent data from a very large study in over 3,000 patients has further documented the burden of disease in individuals who have greater than 5% involvement and those individuals with the darker skin types and who have the disease on exposed areas such as the face and the extremities. So the new treatment algorithm that we're investigating, which is very exciting, is the use of SCENESSE, which Dr. Wolgen and Dr. Rosenfeld have alluded to, SCENESSE in combination with narrowband UVB. If you look at our guidelines, narrowband UVB is the standard of care for those individuals who have more extensive involvement. And so in our new Phase III studies, where -- they're randomized studies comparing the standard of care for extensive disease, narrowband UVB versus SCENESSE in combination with narrowband. I was one of the lead investigators for our data published in 2014, looking at comparing narrowband UVB monotherapy versus SCENESSE in combination with narrowband. And it is exciting that we're beginning to see in our 105 study, the very same observations that we saw in our original study. So that preliminary data suggests that we're clearly seeing faster re-pigmentation with SCENESSE in combination with narrowband UVB versus the standard of care, which is narrowband UVB monotherapy. So we're very excited to move forward with our 105 and the 107 studies. I think that it is really exciting to look at where we were in 2014 and being able to move forward and bring this drug to the marketplace, because I think the difference that we're going to see, if you compare it with other modalities is not only the efficacy, but the speed of re-pigmentation as well. If you look at the skin-of-color market in the United States, it grows. By the year 2040 or 2050, half of the population in the United States will be skin of color. So I think that, that has to be a part of where we go in looking at value-added, bringing this drug to the marketplace, so it really is exciting. So in summary, our new algorithm for moving this science forward, we will investigate patients with greater than 10% body surface area, having generalized disease affecting the face, trunk, extremities and genitalia, and our initial trials will be looking at individuals with darker skin types. Those individuals who are characterized as having skin types 4, 5 and 6. So this really is a very exciting time. Lachlan?

Thank you, Dr. Grimes. When we started our commercial program in the U.S. in 2019 and certainly subsequent to that in the post COVID environment once the restrictions were lifted, part of what we looked at was how can we develop an EPP program, which we can then expand into addressing larger markets. Is there a possibility for us as a company not to address just an orphan indication, but really to look at vitiligo and other disorders in our pipeline to understand whether or not we can treat those patients ourselves. Can you replicate that model. As a part of what I want to talk you through today is some of our thinking around that development and what we have put in place in terms of the commercial infrastructure today. We are roughly 74% of the way through establishing the team necessary to treat vitiligo commercially. And so our thought process is really around having specialists, both in the U.S. and outside, who support that program sufficient to treat a group of patients with quite a specialized technology. The key learning for us is around the complexity of our supply chain and the way in which we've made the product available today. The agreement that we have in place is controlled distribution for the product. And one of the tasks the team is working on at the moment is to reduce the complexity in the supply chain, reduce the number of centers that are involved. And in fact, by doing so, being able to distribute the product to a larger number of patients from a smaller base of distribution centers. Anybody who works in logistics will certainly understand in that post COVID environment that the difficulties involved in moving products around the world, and indeed moving products around the U.S., and adding to that complexity with a cold chain supply, you do need to have options. And so again, part of what we're looking at, at this point in time, is expanding our logistics and shipping network so that we can reach more patients. Dr. Linda Teng and her team have really worked to expand the initial group of specialty centers treating EPP patients, again, with an eye to treating a larger number of patients with vitiligo. We said a number of times that the target for us is 120 specialty centers to be able to treat vitiligo patients. And as it stands today, we've got 87 that are trained, accredited and able to administer the product to patients. There are somewhere in the range of 8,000 dermatology centers in the U.S., around 12,000 dermatologists, and around half of those are capable of treating vitiligo as a systemic disorder. And part of the thought process for us and the map that I'll show you later, gives you an understanding of how we're trying to make that spread and make sure that we are reaching those centers that can treat patients. As Dr. Grimes has just talked through, we are also looking at a particular group of patients, those with Fitzpatrick Skin Types IV, V and VI. We need to be mindful of that in terms of the distribution of that population and also the physicians who are already treating those patients and make sure that we're targeting those centers that are capable of treating those patients longer term. When we look at modeling for approvals of drugs and indeed, the [ Tufts ] models that Dr. Wolgen presented earlier today, what we model in is approval, the first regulatory hurdle. And what we don't think about is the subsequent hurdle that is put in place, which is around payers and reimbursement. It's not a discussion that we hear very often in terms of the overall challenge of getting a product directly to a patient. The infrastructure that we already have in place acknowledges -- or sorry, facilitates a number of patients being able to receive treatment across the breadth of reimbursement programs. So in EPP, we are seeing patients treated through Medicare, through Medicaid. We have an agreement in place with Veterans Affairs and where we started out and where we continue is more than 100 insurers across the U.S. who are facilitating reimbursement of the product for EPP patients. That familiarity with our product, the way in which it's used, the way in which it's distributed, the way in which a physician will prescribe and seek reimbursement, places us in a way that we can expand from EPP into vitiligo. And so that familiarity really provides us with a leg up once you have the vitiligo approval in place. It's a little bit wonky of me, but you also need to have the infrastructure to help the physicians seek reimbursement. Now in a country or a society where you have a national health system that really -- this is not particularly well understood, but in the U.S. you are not in a position, as a physician, to treat a patient unless you have treatment codes. And for us, it took about 18 months for Linda and her team to get the codes in place for EPP, the code to administer the product, the code to reimburse the product. But now what you have is the ability for your specialty centers to speak directly in the same language to insurers to enable those insurers to reimburse the product for their patients. We don't need to do this again for vitiligo. It's specific to the product, it's not specific to the indication so that infrastructure is in place. The prior authorization process has also been smoothed through over that period of 4 years since the product was launched. And so there is a familiarity with these centers to be able to treat these patients, to be able to put the paperwork in place, to reduce the overall burden to enable a patient to receive treatment. Again, this translates across from EPP into vitiligo. When I started with the business in 2007, we looked at a lot of maps like this. Now that point in time, the focus was very much on EPP, and then the U.S. maps in particular, trying to understand the EPP patient population. Where were the patients living, how can we get a clinical trial up post an IND authorization or authorization of a protocol. Today, we've pivoted that slightly in so much as we're now looking at where can we get these patients treated commercially. And subsequent to that, where can we establish centers so that vitiligo patients can receive treatment. The team is now 71% of the way through establishing those centers. The map that you see here is a combination of active centers and those centers that are in the process of setup or being targeted. We now have 74% of the team in place to be able to facilitate this program initially for vitiligo patients. The treatment codes enable us as a company to shift from treating EPP into treating vitiligo almost seamlessly. And as you'll see a little bit later on, the focus of the business now is very much on how do we make sure that there is an awareness within the vitiligo community, within the dermatology community to say, Clinuvel has a product, it is coming, and I'm going to be using it to treat my vitiligo patients. So the approach pivots now from an early stage where we're using social media to try and identify patients to a late stage where you now have a commercial infrastructure in place and facilitating treatment for those patients with vitiligo. We sometimes get comments, critiques around the idea of N equals 1 or N equals 6, what is the value of treating a small number of patients. In vitiligo, it's very obvious in these patients when you see that the therapy is working. The impact of the disease is very high. The impact of the treatment and the efficacy of the treatment is incredibly visible and you see that process go through. But I need to stress that when we see an individual patient receive treatment, [ when ] we receive that feedback as an organization, it really feeds back into the way that we're thinking about how are we building this program. And I would ask, the video that I'm about to show, please watch this very carefully, understand the journey that these 2 patients are on and what impact it's had in particular for one of them who has been through one of our clinical trials. [Presentation]

And so you take a patient on the journey of 21 weeks to, not only give back their pigmentation, their identity and I particularly believe that in patients of color, it is significant because the contract is so high. So we were the first company in the world to give attention to these patients. It's something to be proud of. And I also understand we were also the company that therefore attracted the competitors to come into the field. And sometimes competition is actually good. Some shareholders of ours have an anxiety about the word competition. Many pharmaceuticals have competition but it actually expounds the market. It gives attention to a disorder that attracts then further funding and certainly, the willingness for insurers to reimburse and the market is vast enough. Now what you've seen in Dr. Grime's presentation is a diagram, whereby on the left-hand side, the market is divided in those companies that are providing creams, topical, transdermal formulations. That's awkward because you need to wear your clothes all day, and it's therefore really difficult to comply with it. And there are 2 companies in the world that are going to provide systemic re-pigmentation. The one is the oral JAK inhibitor from Pfizer and the JAK inhibitor is an immune suppressive drug. So suppressing the immune system in otherwise healthy patients is going to pose a problem long term. And then there is the non-immune suppressive treatment by CLINUVEL, which is safer on the long run. It's the natural hormone that we all possess, but amplified. And another question that came to us is, well, why is CLINUVEL behaving so differently? Well, I see that as a great compliment actually. And I heard Lachlan Hay, our Chief Operating Officer, explaining what he had done in the company since 2007. And I want to take you to an anecdote because you prompted me to say that. In 2007, we hired a team of what I called crazy young guys who had no standing in pharmaceuticals, but they were IT savvy. They understood the use of social media. And we had 2 choices: we could remain a conventional company and operate like any other pharmaceuticals with the notion that 25 years had led to failure and no value creation for shareholders or patients in the reverse order, by the way; and we could also say, well, we have a different vision about how drugs can and should be developed and certainly, afamelanotide. And we were the first company to use social media in order to recruit patients. So we entered the door that was somehow exotic. And that led to the first investment by the Silicon Valley investors, Sean Parker and Michael Polanski. They took 5 years to take a sizable stake in this company. That contact, that relationship, led to discussions on what the drug would do in vitiligo over the years. And they were truly investors in the sense that it's value they seek long term. In these discussions, it became clear that social media would play a role in marketing. And marketing, in my jargon, is equivalent to visibility. And many companies and many products fight for the attention for the visibility. And so the idea started in 2014 when Michael first met Stephanie Germanotta, now under the artistic name, Lady Gaga, to see at what point in time celebrity-endorsed programs could benefit the pharmaceutical company because it's unusual. Well, it took to the beginning of this year to organize this event, whereby the finfluencers, the financial influencers, the social media influencers, the cosmetic influencers, the press and executives in the entertainment industry, to gather together at her house and to organize this event. Now without being condescending about this event, but we saw it as a pilot, we see it as a pilot. We wanted to understand what happens if a pharmaceutical company starts talking about their markets or products in the celebrity-endorsed environment? What kind of traffic are you going to generate? And I'm going to share with you what happened over the last 10 months with engaging and employing a social media team in-house. We had 75 million impressions, that means views, of which 51 million were on Instagram. Those people that read these messages were 40 million in number. Now the conversion from 40 million to the profile visits means those people that actively started to read, look up and follow and hyperlink CLINUVEL, 119,000 people over the course of 10 months, we never had that with any success we had on the regulatory and insurance front. And so if you look at this particular event, we had 3.5 million viewers, 11 million readers, simply because it was celebrity endorsed and comments were made about the products and the company. We were in magazines that the company have never been featured in. Now you can ask yourself, well, is that important for pharmaceutical company? No, it is generally not important for a pharmaceutical company, but it is important for a pharmaceutical company that has a product, a drug, that has a visible and phenotypic impact. So the bronzing of the skin that we see in healthy volunteers is translated in medical tanning, in vitiligo, the natural home/office product. So I would dare to say that the experiment of engaging and associating ourselves with celebrities, who have a wider following in the North American market where we're going to play, has succeeded and we will see more of this. Now the question then is, if the ambitions are so large on the medical front and the company is, again, making an exotic excursion by adding a cosmetic venture to the pipeline, how are you going to distribute these products? Well, we reverse the order. It's not about the readiness of the products. It's about the audience you need to build in order to raise the awareness, visibility, in order to succeed commercially. And so you will see the next 24 months, and certainly before my tenure ends, a flurry of activities -- marketing activities, increasing the visibility of the company both on the medical and overlapping on the cosmetic side. And one of the largest events in the world, as you know, is the American Association of Dermatology, American Academy of Dermatology, that is held once a year in March with 20,000 delegates. And this is the first time where CLINUVEL will have a 450-meter square space and exhibit their focus on vitiligo. We've never done that in the existence of the company. What is the purpose? How do you quantify the effect of it? By the number of delegates that are exchanging their cards with CLINUVEL, that are following and that are also recruited both as a prescriber and in the clinical trial centers. So that is money well spent in the target population, which are the U.S. dermatologists that eventually are going to prescribe the drug. And once you build the foundation of the success, which I call the visibility, the audiences that you need to generate, we introduced the M line. And the M line stands for the melanocortin, the peptide-containing cosmetics. Now this is a journey that started 46 years ago, where every cosmetic conglomerate on the world has tried to incorporate peptides in their cosmetics. The reason they abandoned that effort is because they didn't have a clinical program behind it to substantiate the data. So the sense that a pharmaceutical company is combining with the cosmetics is logical because we are the only company that generated the data. So the halo effect of translating the medical data into cosmetic data makes perfect sense as opposed to divesting the cosmetic company to someone else. So there's more that you're going to see. This is a time line that I will let you read in your own time at home. These are the number of activities, global events, that we are planning in order to raise the visibility and awareness of our medical work as well as the cosmetics prelude that is coming to the market. In summary, we discussed today the ownership of the company that has increased 12.2% in institutional shareholders, mainly Australians. I've also tried to demonstrate that the price in the echelon of $5 billion market cap and value is decoupled. There's often no relationship between the performance -- the financial performance of a company, and the value that it commands at a certain time. We've got 13 catalysts in 2025 for you to follow and see whether we meet these. And vitiligo is not only a program that we conduct clinically, but like EPP, we prepare the commercial footprint in North America in order to recruit as many centers as possible and make them aware of the significant repigmentation they can offer to their patients. Now social media in the entire program now becomes central in order to raise awareness of this company. The same way we experiment in 2007, we experiment with events, global events, to see whether the volume is being turned up and whether the company attracts more attention online. And once a critical threshold is reached, it will be time to introduce these products. But the foundation of the company, the protection of shareholders, is actually the cash reserves, the cash that it generates from other programs. And make no mistake about it, we would not stand here today if this company had to raise serially over the last 5 years. Now on this journey, you meet significant individuals, talented professionals that you benefit from. These professionals, like Dr. Grimes, are what I call believers. A pharmaceutical company cannot buy physicians to prescribe their products. It may be prevailing in some companies, but we have never done that. But what we have done is we attracted individuals, talented academics, that became somehow believers, infatuated with the mission of this company. And one of them is Marcus Maurer. He's the third physician I ever saw in my life when I did diligence on CLINUVEL, at the time Epitan, he's the head -- the academic head, of Charité Hospital, the second largest hospital in the world -- in Berlin. And tragically, he went missing in August and never returned from a hike. And the lesson for all of us is cherish a life because we had an appointment to see Marcus Maurer in September, but we were one month too late. On this note, ladies and gentlemen, I invite Melissa Benson and Mark Pachacz to lead the discussion. Thank you for your attention. I'm not saying that because she's here, but because she spent a disproportionate amount of time in investigating and researching vitiligo. As you know, I hold analysts in the highest esteem, the sell-side analysts, and Melissa has followed and tracked the company and writes up the company on a regular basis. You know my chagrin about this is that institutions get to read the reports, but most of you, unfortunately not. And that is symmetry in the market is something that I have not been able to solve and won't solve today, but I very much appreciate Melissa and the work she does.

So I'm excited, I guess, to dig into just a couple of questions that have come up today, and I think really thinking about your strategy in vitiligo and obviously, whilst we also have Dr. Grimes here. Perhaps the first thing is, you were speaking to the systemic therapies, there's the autoimmune and then the CLINUVEL approach of repigmentation. Should we actually think of those autoimmune therapies as competitive? Or as a clinician, is there kind of a space to using both in parallel? Or I mean, how should we actually think about that?

That's a great question. And I've spent so much time thinking about it, given the fact that we do have multiple new JAK inhibitors, immunosuppressives, that are in clinical trials. And so my vision of how SCENESSE and narrowband UVB will be used, I think there is a place for what I call the trifecta. I think that SCENESSE does things that the other treatments don't do. One of the gaps in treatment is speed of repigmentation. This is what we're consistently seeing. It works faster in combination with narrowband. So I envision the immunosuppressives, being able to quickly damp down the immune response while SCENESSE and narrowband UVB work in harmony to expedite the repigmentation process. So I see a place for all.

Yes. I think that's helpful. And maybe one more for, I don't know, if Lachlan or Philippe, but you've spoken to this 120 centers being the target. But you mentioned there's maybe 4,000 dermatology centers in the U.S. I mean, why is 120 the right number? Is there a capacity constraint? Why not 250? There are states on your map that are still missing centers, I guess, just the rationale there.

We've looked at a number of different factors, and I think we spoke about a few of them today. 120 is a starting point for us and needs to be seen that way. But we think -- and the numbers that we've given previously for years 1 and 2, we think 120 is sufficient to treat that. So that's the thought process.

So we shouldn't think of 120 as the limit, the 120 is the start and there's capacity for more and more, and that's the initial target.

Absolutely.

Yes. Okay. A really important part, I think, of understanding, you said speed to pigmentation, but I think speaking to clinicians like yourself, the durability of pigmentation is also really important, I think for patients. I mean, maybe this is one for either Philippe or Pearl, but understanding how are you going to assess that, I guess, in your clinical programs, but I imagine that's also something that patients and clinicians are going to immediately ask is, how long does this effect last for? So I don't know who wants to...

So I can address that, Melissa. I think that durability is absolutely key. We know that, if you look in general, many patients with the current therapies will lose repigmentation. But one of the things we observed in our original trials, and I think we may well -- we hope we'll see the same phenomenon in the new studies, is once we completed that trial and we saw those individuals back in follow-up, they maintain that pigmentation for at least a year. So that's pretty phenomenal. And so clearly, it's something that we will be addressing in the new studies. It's very, very important.

Because I imagine that also factors into important pricing and reimbursement discussions. Everything has a price, I guess, dependent on the value it creates, and part of that is the length of time. So is that something that, I guess, you guys are thinking about in the existing ongoing Phase III program? Or is it something that also will be more of a feature potentially of the second, the CUV107?

Well, I think you're trying to design a program to get a product approved, firstly. And then the thought process needs to move to the commercial side of that. You're generating data. The data will help in those discussions with the payers and the interactions that you're subsequently going to have. But there is a thought process around, okay, once you've reached that level of repigmentation, what is then required for a patient? And I mean that's a clinical question really, but it is one that you have with your payers as well.

And so if we skip forward, I think from an analyst perspective, you're always trying to think what does the approved label allow you to sell basically. Is the way that -- is it right in thinking the current trial designs really support that initial repigmentation? And I know you've spoken to the potential for kind of maintenance doses or boosts, if you like. Is that something that you think would -- is going to be evaluated in the current clinical trials or that's kind of follow-on work to get that kind of extension or a maintenance application, I guess, on a label?

You taking that question?

I want to translate some of the questions to Melissa because the simplicity is -- and correct me if I'm wrong, the label of a product is the way the product is going to be used when it's on the market. That's conditions of use. And in the clinical program, you try to emulate the conditions of use as best as you can so that you can anticipate how much the physicians are going to prescribe and how much the insurers ought to reimburse. We hold diverse views on that, given our different background. The label will be between 7 and 9 implants. That is what we project because there's individual variability. So you need 7 to 9 implants to get 80% to 90% of your pigmentation back, except the hands and the feet because they never repigment. And we understand, and that is empirical, that is from the feedback we get from the clinicians that there will be a maintenance therapy of 1 or 2 injections per year. Now if you think about this, this is the Allergan model that they followed for decades. This injection of SCENESSE, in our view, and I think that's where we find each other, in the prospective views on the use of this product, is that every dermatologist is going to have 1 or 2 injections of SCENESSE draw to either initiate or accelerate the pigmentation because it's so prominent, what you do. And so for shareholders at home and here, in most disorders in the world, you don't know whether a therapy is effective until you draw blood or you take an X-ray. In this particular condition, it is so visible that its effect is prominent. And so the acceleration or the finishing of pigmentation with an injection is most likely to occur once the drug is on the market. And our view, therefore, is you need to have as many physicians aware of the product coming and being on the market; and b, you need to scale up your production in order to meet that kind of pent-up demand.

And if we think about the kind of addressable market, and obviously, you're going after a very specific cohort of those darker-skinned patients that really see, I guess, the highest unmet need, but if we think about patients outside of that kind of Fitzpatrick IV, V, and VI, do you -- I guess, clinically, you see patients outside of that cohort. Would they get benefit from SCENESSE? I think if we're looking down the line, I understand why you would design a clinical trial. But should we think of it as kind of restricted to those patients? Or is there actually a broader applicability?

Currently, in the trials, as you mentioned, we're strictly focusing on individuals with IV through VI. But I think, as we design and amend our trials and do additional trials, I think it is essential that we probably move forward and look at the efficacy and safety in a broader population, particularly those individuals with skin type III who were included in our original study.

And maybe just one final one for me, more on the progress, I guess, to date if anything you can share of the ongoing CUV105 study. We expect that to finish recruitment mid-next year, but then also we know you've got the kind of the companion Phase III in preparation. So just anything you can kind of share, I guess, on the progress updates there.

So in the course of my career, I had many significant mentors, and now I see myself at that stage. But what I've learned is that you do clinical trials to learn along the way. And so I give you one example that may be interesting for shareholders. You surround yourself with the world experts, and we have the privilege of having one now. And we think we all know the finite elements in these patients, but we discover things along the way. And one of the discoveries was and has been that patients, who are previously unresponsive to narrowband UVB, seem to respond to the combination therapy, where there's no world expert that ever said that to us or had written about it. So you discover newsworthy facts that are of, I would say, commercial benefit later on that weren't published, that weren't known, but you actually learn by doing it. And so the development is not for nothing called research and development. The clinical data give you new facts that were previously unknown and that are of use. And so now that we know that patients that were excluded, because they were unresponsive to standard of care and now responded to combination therapy, so you have increased your markets by learning. So it's beautiful, but it's painful because it takes time.

So you're still on track. Should we say that?

Yes.

Okay. I think that's everything for me to keep it efficient.

Okay.

Thank you very much, Philippe and Pearl, Lachlan, Melissa, for your presentations, questions and answers. Can I ask Dr. Wolgen to remain on stage and Mrs. Smith, Mr. Pringle, Mr. van Dievoet and Mr. Hay to join us as we now take questions from Mark Pachacz. Mark, come up, please. And Mark have some questions from shareholders. I'd like to welcome Mark Pachacz from Bioshares. Mark is the principal of Bioshares, which he established in partnership with the late David Blake, and has been analyzing CLINUVEL since 2006. Thank you very much for joining us today, Mark.

Pleasure, Jeffrey. Can you all hear me? Is that on?

Yes.

Yes. My name is Mark Pachacz. I've been covering the biotech sector with David Blake, who passed away a couple of years ago. And in preparation for today, I just looked at the first newsletter that we wrote about CLINUVEL, which David actually wrote, and it's probably worthwhile just reading up the first paragraph.

When was this?

This was in Edition 195, so about 800 editions ago, in December 2006. So it reads, "One stock that has previously failed to generate the interest of this newsletter has been CLINUVEL Pharmaceuticals, formerly EpiTan. Since listing on the ASX in 2000, CLINUVEL had a string of investment issues from the outset. Its core technology emerged from research conducted in the early 1990s. And as a consequence, its key patents were going to expire between 2001 and 2008, well before any of its potential products might reach the market! Its management team was very thin and its product applications as injectable pharmaceutical to reduce skin cancers and to promote cosmetic tanning use was a confused and risky approach into a nonestablished market."

That's what he wrote.

That's what was written in 2006. So I think the -- I'm glad the company has taken on all of the recommendations, and it's evolved since then. And it's probably a good segue into the first question for Jeffrey.

Can I say something about this?

Sure.

Shareholders influence us in our thinking. But likewise, analysts and what you write is being read and influences as well. So to be able to prove you wrong gives us a greater satisfaction.

Sometimes it feels like you're working in a vacuum as an analyst, but something all other analysts understand. So that's nice to hear, thank you. So Jeffrey, you presented a very positive view today on the company's future, talking about multiples of growth, I think, were your words. But this is not without risks and challenges. Can you comment on the main points of concern for the Board going forward?

Look, really, our first challenge is to replace our CEO with an expert, excellent CEO like Philippe has been. We need to maintain the culture of the organization, in other words, retention of staff for long periods, which we have, the expertise in the organization. We have the challenge of bringing vitiligo to a conclusion in its trial, on-time and hopefully with a positive result, which will be approved by the FDA. We have the cosmetic launch as another challenge, the timing of that and cultivating the audience or the future customers for the cosmetics. The value creation in the company is clearly a challenge, which we're rising to, but that also determines share price value proposition to shareholders. And we obviously want to attract more shareholders, institutional investors, particularly. We have a very positive cash balance. That's a challenge. It's a risk. And clearly, we need to undertake M&A or M&As to use some of that cash, and we intend to do that in the next 12 months. And so they're the main challenges we face for the immediate future.

Thanks, Jeffrey. Next question is to Sue, and that probably follows on to one of your first challenges you highlighted there. Does the Board view that filling up Philippe's position as a challenging task? How will you go about it? And why doesn't Philippe continue until SCENESSE is on the market for vitiligo, Sue?

Thank you, Mark. Of course, it's a challenging task to recruit a new CEO, particularly when Philippe has transformed the company from an R&D company into a very profitable organization. So we don't underestimate the difficulties of finding a suitable successor. We have to adjust to the post-Philippe Wolgen era. That's going to be a big task for us. But we relish doing it and doing it well. We will be looking at international markets across the world. We will look at the domestic markets. And of course, we will look in-house to find the suitable skills that we need for this post. Philippe will be very keen to hand the baton over to his successor. And I know that he will do everything that's required to lay the ground and be ready for the new successor. I think he's laid the foundations for the vitiligo pathway. You've heard so much about it today. The foundations are there and the team is a dedicated team that he has built. So we are fully conscious that we have what is required to take vitiligo forward. And Philippe will lay the foundations before the end of his tenure.

Thanks, Sue. Matthew, welcome to the Board.

Thanks, Mark.

What's your impression of the company's financial and audit track record? And how do you view the company's cash position and the level of distribution that's currently being made to shareholders?

Thanks, Mark. That's probably 4 elements to that. So in relation to the audits, I've just been through my first Board meeting. That was a really good couple of days, actually, very enjoyable and very exciting. I think any company who has gone almost 20 years with clean audit opinions is being pretty well managed. And that's -- I've been in plenty of situations where that hasn't been the case. So I think that's a really good foundation for the company going forward. In terms of the financial performance, I think the profitability and the positive cash flows that the company is now generating since the introduction of SCENESSE is really something we should be really proud of because this is a high-risk industry, high-risk company in terms of the technology that we're facing and the R&D that we're trying to exploit. And I think to be profitable in that environment is just, in many respects, is quite unique. So I think I feel personally very privileged to be a part of this company with that sort of track record. In terms of the cash holdings, the first time I looked at the company, I was actually surprised at the amount of cash. And then on reflection, given the risks in the industry and the capacity to reinvest and then have to go to the market to see continual equity top-ups when they're making decisions is an incredibly positive position to be in because I don't know that we'd be -- as I think Philippe said earlier, I'm not too sure we'd be here today as a company, if we had to continually go back to the market to raise money for our clinical trials and our R&D programs. So I think that's an incredible benefit. And looking forward, I think it offers the Board a great opportunity to do things and take advantage of opportunities without having to extend into extensive debt facilities and other things. So I think it really enhances our risk profile, that cash balance. But we do need to use it and use it wisely. So that's a challenge. In terms of the dividend policy, the Investor Relations team have given me both ends of the spectrum, shareholders saying that we should keep it all and reinvest it in the R&D, to the other extreme that says we should give it all back to shareholders and not retain any. But on reflection and from the analysis that I've done personally, I think the Board so far has found and struck a pretty good balance, I think, in terms of maintaining the cash required to see the business into its future -- profitably into its future with prosperity and also recognize it is a profitable business and does owe the shareholders a return. So I think there's a fine balance here that's been managed.

I guess that will be a good discussion point of Board meetings with the additional new Board members.

It is, yes.

Moving on to a question for Philippe, just around competition. So competition in EPP, competition comes in various reports and discussions. How do you view the threat of competition in EPP? And how difficult will it be for companies to compete in EPP given, I guess, the level of difficulty or the level of requirements that you've had in terms of delivering your product and your pharmacovigilance programs?

The first word that I pick up is threat. We don't see competition as threat. That's already a very different viewpoint. I think about the economics of it, you've got the Pareto efficiency curve. That's how I think about the landscape of pharmaceuticals. And what is the optimum point where all patients are treated? Is it a winner takes it all? Or is there room for 2, 3 or 4 players? Well, that question has never been posed to a company like CSL because I'm always fascinated about an orphan disease that they have, the HAE market, where there are 4 players. But the 4 players have enlarged the market that has driven the price up, and so I necessarily don't see competition as threat. If there is prospective competition, and that is big if -- because both companies fail the Phase II and Phase III trials, if there is competition coming in a number of years, then I could well foresee that you will coexist in the same space. And sometimes it's combination therapies like you see in oncology, and sometimes alternative therapies. Sometimes the pool of patients that are willing to be on one drug do not want to be on the other. And we see that in our clinical trials because -- or in their clinical trials because many of their patients are actually switching to our drug. And so I don't see the issue that is made by analysts and by the press here. Competition is actually good because it gives more prominence and visibility to the disease. Payers will be more willing to pay for it. And you're in a larger market actually. And don't forget the journey that an EPP patient has is decades in the dark. And to convert them to a treated patient that takes years for them to lose that condition behavior. And so we have been growing year-on-year while so-called competitors are running clinical trials. So if you mathematically think about it, they already have clinical trials while we are expanding our markets. So I don't see it as an issue.

Thanks. We'll just move on quite quickly.

I think we're going to run out of time. What is that going against us...

How much time do we have?

Maybe one more question.

One more question. Well, I think we better ask Guy a question, given he's up here. Guy, you've got a background in M&A. What's your prognosis on CLINUVEL's aspirations to acquire assets? Should CLINUVEL be considering acquisitions at this point given the array of opportunities?

Well, I imagine being here shows that CLINUVEL is considering acquisitions. I hope to contribute to that development. And the cash worth we're sitting on is definitely an advantage. However, we have to remain very cautious and be sure that we can independently develop our organic growth. So it's a balancing act, but I think that the Board is well equipped to do so.

Just a very quick follow-up, if I can, Jeffrey, just to both you and to Philippe. On the flip side, is CLINUVEL a takeover target at these suppressed prices?

Well, the price and the cash make you vulnerable. It's not easy to take over a company in Australia on a hostile basis. But as a public company, whoever is willing to bid for it and the bid is reasonable, then we will take it to shareholders. It would sadden me if we -- just before the vitiligo market matures or comes to fruition, if we had to sell out. But yes, it's possible.

Well, we hope it doesn't happen. If the share price would rise significantly, we hope, we are planning for it to rise. We are designing our company around increased value, and that will make a takeover more difficult for anyone to execute, I would say.

Thanks, Jeffrey. Just before I finish, just have a present for you, Philippe. It's a copy of the first edition cover.

Thank you.

All right. Well, thanks very much, everyone. And thank you, Mark, for that. We now need to quickly move on to the business of the meeting. And I now turn to the 9 items of business for today, 8 of which require a formal resolution. This includes 1 nonbinding ordinary resolution -- switching mic, sorry, 6 binding ordinary resolutions and 1 contingent item of business. In order to ascertain the true intention of shareholders and to reflect our focus on transparent governance in accordance with the company's constitution, as Chair, I have determined to call a poll on all resolutions to be considered at today's meeting. The voting procedure. All valid proxies received have been recorded and the votes for each resolution will be displayed on the screen behind me. And as such, I won't read out the numbers as we deal with each resolution. As advised in the Notice of Meeting, where proxies have been properly nominated to be, at the Chair's discretion, those proxy votes will be cast in favor of resolutions 1 to 7 and against Resolution 8. With regard to voting on resolutions, all shareholders, proxyholders and authorized corporate representatives who are entitled to vote should have been issued with blue voting cards, as you can see on the screens. A voting card also entitles you to comment and ask questions in this meeting. If anyone present is entitled to vote and does not have a voting card, please see one of the Computershare staff at the registration table at the entrance door, and they will assist you. Nonvoting shareholders were issued with a yellow shareholder attendance admission card upon entering, as you can see on the screens. A shareholder attendance card will not allow you to vote. However, you may still comment and ask questions. White cards and visitor card -- sorry, white cards are visitor cards and indicates a visitor. Visitors and media are reminded that whilst we welcome you at this meeting, it is a shareholder meeting, and you may not make comments or ask questions. If you wish -- if I call on you, please raise your voting or nonvoting attendance card prior to speaking to identify yourself as a shareholder. If you are acting as a proxy, please state clearly who you are appointed to represent when introducing yourself to the meeting. We will provide the opportunity at the end of the formal items of business for shareholders to ask questions. Hopefully, we'll have time to let you ask the questions. Voting on all resolutions is allowed up until the time the poll is closed. A representative from our share registry, Computershare, will now provide details on the poll process.

Good morning, ladies and gentlemen. I go through the process of conducting the poll. All shareholders and proxy holders with blue cards are entitled to vote on these items. On the reverse of your blue card are all the items of business. Please mark the box next to each item to declare how you'd like to vote. At the bottom of the card is a spot for you to print and sign your name. Myself and my colleague will be coming around with purple boxes. Please ensure you lodge your cards in the box to make your vote count. Thank you.

With regard to proxies, we have engaged the services of our share registry to compile and report on proxy voting. Computershare has provided its formal report disclosing the proxy votes received. When Computershare have tallied the poll results, we will announce the results following conclusion of today's meeting on the ASX market announcements platform. Before opening the poll, I wish to remind shareholders that the poll will remain open for an additional minute after we have considered all resolutions. If you have any questions on the formal part of today's agenda, please follow the questions process as previously advised. I now declare the poll open. I will now move to the items of business to be considered today. Item 1, the financial statements and reports of directors and auditors. The first item is to receive and consider the financial statements and reports of directors and auditors for the financial year ended 30th of June 2024. These items are contained in the annual report, so I will ask that they be taken as read. The annual report is available on the ASX announcement platform or on the company's website. The Corporations Act requires the accounts and reports to be laid before shareholders at the AGM. However, except as set out in Resolution 1, to be considered later, there is no requirement for a vote of members to be taken on them. No written questions to the auditor were received by the cutoff date, 5 business days before this meeting. Questions may be directed through myself, to the auditor, in relation to the conduct of the audit, the audit report, the company's accounting policies or the independence of the auditor. Does any shareholder have any question or comments on the financial statements and reports? There being no questions, we will proceed with the agenda. The auditors are here if anyone wishes to ask the question. Now we will move to the formal resolutions that need to be considered. The proxies received in relation to the formal resolutions will be set out in the slides displayed on the screen before me. Item 2 is resolution 1, adoption of the remuneration report for 2024. The first item -- yes, the remuneration report forming part of the directors' report for the financial year ended 30th of June 2024. The vote on this resolution is advisory only and does not bind the directors or the company. Following the strike on the company's remuneration report last year, the Board and I have sought and received feedback from shareholders, which is reflected in the following actions: Our approach to executive remuneration is explained in the context of the company operating internationally and recruiting and retaining talented staff in the global labor market. The remuneration structure has been simplified. Executives other than the CEO have 3 components to their remuneration: fixed base remuneration, short-term incentives, long-term incentives where the LTIs are equity. The MD only has fixed-based remuneration and short-term incentives since no new equity-based long-term incentives have been in place since the expiry of past performance rights in November 2023. Disclosure has improved. This has been improved over the years and is recognized by proxy advisers. In 2024, we went a step further to provide detail on the level of award of KPIs under the MD's short-term incentive. We compare CLINUVEL's performance and executive remuneration to a representative peer group of similar market cap, stage of development in commercial and products as well as complexity and international focus. This group was expanded from 26 in 2023 to 34 in 2024. This comparison showed CLINUVEL was a relatively strong performer across key metrics and the MD's remuneration was below the median of the group, below the median of the group. I refer you to the proxies received prior to the meeting as displayed on the screen. I now move that shareholders consider and, if thought fit, pass the ordinary resolution. Given time, I now move to Resolution 2, which is the election of Director, Mr. Matthew Pringle, as a Director of the company, Non-Executive Director. I confirm that all directors other than Mr. Matthew Pringle recommend that shareholders vote in favor of his election. I now invite Matthew to come forward and speak to his background and election. Please, Matthew.

Good morning, ladies and gentlemen. I'd like to thank you again for the invitation to join the Board of CLINUVEL. I'm excited about the many opportunities in front of the company and very much looking forward to contributing to its ongoing success. Throughout my career, I've had the privilege of working with various companies across industries, helping them navigate complex regulatory environments, optimize their financial operations and ensure strong, sustainable growth. As you'd be aware from the brief CV in the Notice of Meeting, I have over 40 years of experience in financial management, leading complex audits, providing corporate governance advice and building a strong M&A practice. In recent years, I've worked with several public and private company boards, both as a non-executive director and adviser to the boards. I'm honored to be here today and look forward to contributing my expertise to CLINUVEL Pharmaceuticals. What I bring to CLINUVEL? Well, I bring a deep understanding of financial oversight, risk management and governance, all of which are critical in ensuring the long-term success of any organization. In the pharmaceutical sector, where regulatory compliance, significant product research and investment and market expansion are often financially intense, I offer strategic insights that align financial stability with the innovation required for that success. I have direct experience working with companies in medical research and diagnostic fields from conducting clinical trials to the often tortuous process and obtaining TGA and FDA approvals and product launch while sustaining a viable business and in those previous organizations that are typically pre-revenue. Moreover, I have extensive experience in evaluating complex financial structures, ensuring transparency and safeguarding shareholder interests. My background has equipped me with the skills to work closely with cross-functional teams, balancing financial prudence and the need to fund growth opportunities, whether in research and development, new product launches or international expansion. By joining the Board, I hope to add value by providing a strong financial perspective, guiding the company through its continuing growth phases while maintaining fiscal responsibility and enhancing the governance processes. Thank you very much.

Thanks very much, Matt. I move that Mr. Matthew Pringle be elected as a director on the basis set out in the Notice of Annual General Meeting. I refer you to the proxies received prior to the meeting as displayed on the screen. I now move that shareholders consider and, if thought fit, pass the ordinary resolution. Resolution 3, I move to -- I'll give you a little bit of time, and then we'll move to Resolution 3. This is the election of Mr. Guy van Dievoet as a Non-Executive Director of the company. I confirm that all directors other than Mr. Guy van Dievoet recommend that shareholders vote in favor of his election. I now invite Guy to come forward and speak to his background and the election. Guy?

Hello, everyone, again. I can't display the same level of eloquence as my predecessor, Mr. Pringle, as English is unfortunately not my mother tongue. However, I have more or less the same level of expertise and background as Mr. Pringle. I have been involved in listing many companies on the Benelux Stock Exchanges, the various ones, and I've been heading a lot of committees within listed companies over the years that as far as my experience reaches in the immediate comparison to the role I should fulfill within this company. I don't know if there's much to add to that. I've got a track record of more than 30 years in this field. And I've been vetted by Dr. Wolgen, and I think that's the best recommendation I can make. Thank you.

Thank you very much, Guy. I move that Mr. Guy van Dievoet be elected as a director on the basis set out in the Notice of Annual General Meeting. I refer you to the proxies received prior to the meeting as displayed on the screen. I now move that shareholders consider and, if thought fit, pass the ordinary resolution. I now move to Resolution 4, the election of Director Dr. Pearl Grimes, as a Director of the company. I confirm that all directors other than Dr. Pearl Grimes recommend that shareholders vote in favor of her election. I invite Pearl to come forward and speak to her background and election.

It is truly my honor to be considered for election for the Board of Directors of CLINUVEL. To share my background with you, I have been involved in the vitiligo landscape for more than 44 years. My work has centered on addressing the pathogenesis, immunologic aberrations, treatment and meeting the unmet needs for a group of individuals who have been neglected and who are psychologically devastated by this condition. So my background, we've been on the ground floor. We were -- my group was responsible for doing the initial work that launched tacrolimus and the calcineurin inhibitors for vitiligo. These agents are now used all over the globe for treatment of vitiligo in individuals with limited disease. I'm very proud of our early work that we did to -- that we published regarding afamelanotide in combination with narrowband UVB versus narrowband UVB monotherapy. So we were one of the lead investigators. I have also worked on the JAK inhibitors as an adviser, clinical trials investigator. We were one of the teams that worked on the Phase II and Phase III studies to get ruxolitinib approved by the FDA. I've authored over 175 publications. Many of these publications have addressed vitiligo and other pigmentary disorders. I've had a leadership role in many organizations. I am currently President of the Global Vitiligo Foundation. We are working aggressively to make vitiligo a household name for individuals and physicians around the world. We're doing a substantial amount of advocacy work. I've served on the Board of multiple organizations in dermatology. And I think if I am elected to the Board of CLINUVEL, I bring you my passion. I bring you my focus my commitment and my determination to move vitiligo forward and to hopefully have us look back and look at what we've accomplished in getting the FDA approval of SCENESSE in combination with narrowband UVB so it can be available for a group of patients in need of new treatment. So I look forward to my being elected to the Board of this great organization.

Thanks very much, Pearl. I move that Dr. Pearl Grimes be elected as a director on the basis set out in the Notice of Annual General Meeting. I refer you to the proxies received prior to the meeting as displayed on the screen. I now move that shareholders consider and, if thought fit, pass the ordinary resolution. I think we should leave your question until the end of the -- all right. All right. What is your name, please? And which card do you have? Which card? Yellow card.

Chris Williams.

We can hear you.

My question is of you as Chairman rather than Dr. Grimes. No issue with Dr. Grimes. But we're being asked to pass a resolution in respect of her being a Director, a Non-Executive Director. We've been given no information about any contracts prior -- previously in the future that may be extended to Dr. Grimes that may, in fact, mean that she is not a Non-Executive Director, but essentially an Executive Director. If you could fill that gap in for us, I'd be most honored.

Well, Dr. Grimes is not working as an executive of the company, and I don't believe she will be in the future. Whatever her practice is in dermatology, it's an independent medical practice, and she will provide her patients with the best care. Now you might say, is that a conflict of interest with her position in CLINUVEL? Well, when she presents to the medical community, she will declare her work in CLINUVEL as a Director. So she has to declare any interest publicly, and work ethically in her field to produce the data from her trials that will inform CLINUVEL's business. This can be done by declaring the conflict and by managing it carefully. And she is not going to be a major owner of the business in that sense. Yes, she may acquire some shares, but she is not managing the business as such. She is helping the Board to make decisions about the future of the business, but that's being informed by her expertise in the field. I don't see that as a problem.

[indiscernible] company and Dr. Grimes or any contracting entity that Dr. Grimes is part of, then you should be declaring what those values are, in my view. And you have not declared any of that to anybody prior to this meeting for consideration.

Well, I might just hand that on to Dr. Wolgen to comment on contractual arrangements, if any.

Like with any physician in Europe and United States, we contract with hospitals, institutions, which they are employed by. There's no conflict of interest per se. There are two components to your question. Is she a nonexecutive per se? Yes, she is, according to the listing rules and the Corporations Act. Second, is she conflicted in terms of data management? The answer is, no, because a small pool of patients are being audited independently from the company. So I'll leave it as that.

I think we should move on. We will vote on Dr. Pearl Graham's election. Hopefully, everyone has voted now. And if thought fit, pass the resolution. I now move to the next resolution, which is the election -- the reelection, sorry, of Director, Mrs. Susan Smith. I confirm that all directors other than Mrs. Susan Smith recommend that shareholders vote in favor of her election. I now invite Sue to come forward and speak to her background and reelection.

Good morning, ladies and gentlemen, and members of the company. Today, I am honored to stand for reelection on this Board. I do not wish to spend time regurgitating any past achievements, which you can find in this year's annual report. Instead, I would like to focus on all that this company aspires to and achieve in the near future and the role I will play in its oversight and governance. First, I would like to speak from my position as an Independent Non-Executive Director. As a Board member, my primary duty is to represent the interest of all shareholders, not only the interest of a vocal few, but also those who decide not to vote due to the high administrative burden imposed by their nominees and custodians. As a Board member, I have the privilege of being able to closely follow the operations, growth and progress of CLINUVEL's teams. I also have access to information on the wider industry and possible future competitors. This intelligence is not publicly available and nor should it be since it is of a commercially sensitive nature and determines many of our decisions, which will continue adding value to the company. It suffices to say that without the careful attention that this Board and management make, the company would not be where it is today, a profitable, rigorous and diversified global biopharmaceutical company. My overriding concern as a Board member is how to maintain this momentum and ensure continuity as a decline in values and value would be a tragic twist in CLINUVEL's remarkable success story. However, as Chair of the Remuneration Committee, I have a particular task. The committee deliberates on decisions made by executive managers, taking into account their outcomes and future consequences. As a Board and Remuneration Committee, we have a plan to preserve the long-termism instituted by the current management team, whose depth and indispensable knowledge and quality of decisions is crucial to the continuing success, as you have heard. We are benchmarking the CEO's remuneration against standards in the European Union and United States, our primary markets. As the founder, Philippe has revitalized the company with innovative strategies, keeping melanocortin central to CLINUVEL's vision. Others have abandoned this research. As a result, we all benefit from his business acumen and will continue to do so. As a Board, we know exclusively what Philippe and his management team are working towards, and we follow the logic of their decisions. Therefore, we, as a Board, fully support the remuneration package for '24/'25 and are conscious and grateful to have a team and leader in place who will continue to solve problems that would flummox others. We, as a Board and led by the Nomination Committee, are following a process to appoint the next excellent and experienced CEO for this company. I am ever so appreciative of the reelection as a Non-Executive Board member and will continue to serve your interest to the very best of my abilities. Thank you.

Thank you very much, Sue. I move that Mrs. Susan Smith be reelected as a director on the basis set out in the Notice of Annual General Meeting. I refer you to the proxies received prior to the meeting as displayed on the screen. I now move that shareholders consider and, if thought fit, pass the ordinary resolution. The next item of business related to the reelection of Dr. Karen Agersborg as a Director of the company. I confirm that all directors other than Dr. Karen Agersborg recommend that shareholders vote in favor of her reelection. I now invite Karen to come forward and speak to her background and reelection.

Thank you, Jeffrey. Ladies and gentlemen, esteemed colleagues and valued shareholders, thank you for gathering here today and to those shareholders joining us online, your presence is greatly appreciated. It is both an honor and a privilege to stand before you as a member of the Board representing your interests. The phrase representing your interest carries profound significance. It is a commitment to ensure that your aspirations and concerns are at the forefront of our decisions. My journey with melanocortins began very early in my career, over 25 years ago, just with a physician. I began in 1987, working for a pharmaceutical company. But for melanocortins, that began early in my decision to become a physician. At that time, there were no other experts in the world other than the original pioneers, Mcadley, Dor and Levine. I have dedicated myself as a clinical endocrinologist to a deeper understanding of melanocortin in order to contribute to advancing therapeutic inventions across the full spectrum of conditions treatable by their applications. As you are aware, melanocortins in female sexual dysfunction failed commercially in the United States. Alternatively, a new molecule was synthesized for Bardet-Biedl –Biedl syndrome to achieve weight loss. And then there's CLINUVEL, a company whose leadership achieved unparalleled commercial success in this field. My role on this Board encompasses ensuring the alignment of our scientific and commercial teams toward a shared goal, enhancing patient outcomes. This alignment is crucial, though often easier said than done. At CLINUVEL, we are fortunate to have strong leadership, which fosters this collaboration. As our company diversifies, my extensive experience within this specific field of pharmacology and commercial sales uniquely positions me to that ensure the Board and you, our shareholders, benefit from my far-reaching knowledge. This expertise forms the backbone of our strategy, enabling us to navigate the complexities of our industry. Equally significant is our corporate culture and the emphasis we place on developing leadership. We have cultivated an environment characterized by what I refer to as a healthy tension. This culture encourages us to surpass past achievements and to tackle head-on new challenges. I have observed firsthand the difficulties that many U.S. and international companies or managers have faced in bringing projects to market. Yet under our current leadership, we continue to advance year after year, demonstrating resilience and resolve in our mission. As a Board member, I'm committed to actively holding our leadership accountable for their decisions through a comprehensive approach. First, I will set clear expectations by establishing transparent standards and benchmarks for performance and decision-making. I believe fostering open communication is essential as it encourages dialogue between the Board and leadership to ensure alignment on our goals and objectives. Additionally, I will implement robust oversight by regularly reviewing policies, strategies and outcomes to ensure they align with our organization's mission and values. Upholding ethical standards is paramount. I will advocate for integrity and compliance with regulatory requirements in every decision-making process. Supporting continuous improvements will involve providing constructive feedback and guidance to enhance our organizational effectiveness and adaptability. Engaging stakeholders is crucial as it ensures their perspectives are integral to our decision-making, promoting inclusivity and transparency. Finally, I will encourage a culture of accountability advocating for leadership to take responsibility for their actions and outcomes, fostering a trustworthy and effective organizational environment. By committing to these principles, I aim to enhance the organization's governance and contribute to its long-term success. As I reflect on the value proposition that has been articulated, one question resonates deeply within me, are we making measurable progress and what will this company deliver to its stakeholders? If we, as directors, maintain our confidence in this pathway while holding our managers accountable, I am convinced that the value we seek will create commercial success. Thank you for your trust and confidence in me. I look forward to engaging further with all of you as we navigate the path together ahead. I appreciate your time.

Thank you, Karen. I move that Dr. Karen Agersborg be reelected as a director on the basis set out in the Notice of Annual General Meeting. I refer you to the proxies received prior to the meeting as displayed on the screen. I now move that shareholders consider and, if thought fit, pass the ordinary resolution. I now move to Resolution 7. It relates to the increase of the nonexecutive director fee pool of the company. Given the personal interest of the nonexecutive directors in this resolution, they make no recommendation on the resolution. However, the Managing Director recommends shareholders vote in favor of the resolution. Please note that the increase in the nonexecutive director fee pool is not anticipated to be paid in full. The increased pool allows us to pay the current directors more than their current fee of $70,000 per annum plus an additional $5,000 for committee membership and an additional $45,000 for Board Chair. We note from external research that these fees are considered low for an ASX-listed company. The increased fee pool will allow us to make any further director appointments that enhance the skills and capabilities of the Board and to also have taken on the new directors that we have. I move the increase in the nonexecutive director fee pool on the basis set out in the Notice of Annual General Meeting. I refer you to the proxies received prior to the meeting as displayed on the screen. I now move that the shareholders consider and, if thought fit, pass the ordinary resolution. Now to Resolution 8, the spill resolution. The final item of business for today pertains to Resolution 8 on the holding of a spill meeting, if at least 25% of the votes cast on Resolution 1 are against the adoption of the remuneration report creating a second strike. I now move that shareholders consider and, if thought fit, vote against Resolution 8 as set out in the Notice of Annual General Meeting. I refer you to the proxies received prior to the meeting as displayed on the screen. I now formally put this resolution to the meeting. Does any shareholder have any questions or comments in relation to the resolutions today apart from the one that we've already had? As there are no further questions or comments, that concludes the formal resolutions to be considered. If you require further time to complete the poll, please indicate by raising your hand? There's one more here. [Voting]

I think we have completed the process. I now declare the poll closed. Ladies and gentlemen, that concludes the shareholder -- the poll, but we now have time for -- well, very little time for questions from the floor. We will announce the results later today on the ASX market announcements platform. Are there any questions from the floor before we close the meeting? Yes, sir.

Ray Paulson, I'm also a member of Team Invest. I've got a number of questions, but I'm quite happy if people hang around afterwards rather than dragging out this meeting -- having the meeting run any further. I assume Board and members will stay, will be meeting outside, we can meet them outside.

We'll be here for a short time.

Yes. Okay. That's fine.

You're going to leave your questions to later. I'm sure you don't want to ask one now.

CLINUVEL has always emphasized that it does everything else in-house. What was the reason for departing from that business model by establishing the partnership with Valantech to enter Latin America?

Off to Latin America.

Yes, say it's a departure from previous actions.

Well, I might let Lachlan handle that one as it's in his domain.

Thanks. You need to acknowledge what you're good at and what you're not good at. And in terms of looking at introducing the technology for a rare disease in South America, we certainly have experience introducing that into certain regions where we don't have experience as a team. And where we really thought we needed assistance was in South America. And so prior to the discussion with Valantech, I think we had a conversation for 4, maybe even 5, years with the team at Valantech as to how we might approach this and then ultimately came to the decision that, that was the appropriate way to do it. So in short, you need to know what you're good at. You need to know where your gaps are. And so the thought process was to move ahead with Valantech.

Right. We have another question.

It's Adam Pikitka here. A couple of questions. I'll keep it quick.

Do you have your card, if I may ask, yellow card? Yes. Thank you.

First one regards NEURACTHEL. Just wondering if some advice could be given around when we could expect the drug master file to be filed. And the second one, I was excited to hear about the buyback commencing earlier this year. And I know there's been some comments around blackout periods and so forth. Just wondering if someone could comment around the pace of that buyback. And again, I appreciate the statement was made, a buyback up to $20 million, but it seems to have really gone quite slowly whilst the share price is low. Given the value price mismatch, I figure there could be a bit of an opportunity there.

Yes. The second one first. You might think that the share buyback is an opportunity to support the share price. Indeed, it is. It does support the share price. But from our observation, and it's the case with other companies that have done share buybacks, it's often a very transient effect. And that's what we're seeing when we do engage in this process, transients. And the question is, do we spend the money in our profits towards share buyback? Or do we use the money for, you might say, more productive purposes in terms of maybe using it for R&D? So it's a balancing act and the tempo of the share buyback is determined by strict rules according to the ASX and the effect that it's having on share price. And as you say, there are some restrictions in when you can do it. But we do find that there is probably some outside manipulation of the market going on when the share price rises to bring the share price back down again. This is a strange phenomenon, but we have observed it, and it's off-putting. Now I might just ask Philippe to comment on that further briefly, but also to answer the first part of your question, which I didn't quite catch, about the master file.

To complement the answer of Dr. Rosenfeld, by no means has the share buyback been halted or ceased because that would trigger an ASX announcement. The tempo is dictated by two factors: the periods in which you are allowed to facilitate the buyback -- the on-market buyback, and the second part is whether the company is in possession of market-sensitive information, and if we are, then we clearly do not engage in these activities. As to NEURACTHEL, the Drug Master File and its update will come in December. That progress is well to date. That's the third-party hands that is composing the Drug Master File. We own it. And when it's ready, we will file accordingly. It's a good question.

Well, we need to wrap up. I'm getting the wrap-up signal from behind. We'll take one more. One more question, and then maybe we'll be able to continue the discussion outside the room as we said, a final question.

Yes, Simon Baum. I can't show you my blue card because I put it in the voting box. A couple of questions, please. Prof. Rosenfeld, you said that one of the Board focuses is to complete the vitiligo trials on time. Can you tell us what on time means, please? And what are the consequences for the timing of any subsequent NDA? And the second question, we're told that one of the goals for the next year is the launch of CYACELLE next-generation products. Are those the M line products?

Right. So two questions. The first one relates to the timing of the vitiligo trial, and there are two to come. The first is underway. I believe it's 75% recruited. Is that right, Philippe? Would you like to comment further on the timing of the trials, the 2 trials, and when they're likely to be completed? And secondly, the question on -- what was the second question again?

CYACELLE.

CYACELLE, yes.

Mr. Baum alluded to what the definition is on time indicates that we have set the target at the rate of recruitment to be completed by financial year-end '25. That's our aim and target as a company. In the greater context, I do want to emphasize that the recruitment in vitiligo is under tension by 3 other companies and all the other companies are struggling to find the patients that we find. So it is no surprise that the recruitment is slower than we wanted. But so far, we're expanding the number of centers and the number of patients. So I can be content as much as I wish. On to your question whether CYACELLE is the same as an M line. CYACELLE belongs to the P line, P as photo-protective, M as melanocortin-containing cosmetic lines. So CYACELLE is part of the P line and not the M line. And I alluded to that we will introduce the M line when we have a critical mass, when the denominator of viewers and those that have engaged with the company is large enough that we can convert them into purchases. Could someone give a microphone to Mr. Baum, please?

What's the timing of the likely vitiligo NDA? You've told us 2026 previously. Has that now changed?

I certainly hope so because that's the day where my clock is running out. But an NDA for those in the room is a new drug application. So the aim is to have various meetings with the FDA to review the data 105, while 107 is ongoing. By the evidence we have now, we stand a reasonable chance to getting it through. As I've made clear to the audience over a number of years, we are risk-averse, and risk-averse means in regulatory landscape that we provide the regulators with a second pivotal trial, although they haven't asked for it, in the case that they sent you back for one more trial. So in the event that the FDA and EMA would ask the company to do one more trial, the trial would have been ongoing. So that is part of our risk management. So I can't give you a date for the NDA because it depends on the data analysis and the strength of data that comes at 105.

The other thing to say about the recruitment in the vitiligo trial is that we found that the control group, the ones that were getting the placebo, were not keen to remain in the trial. They were dropping out because they wanted to get the drug. They wanted to see the active effect. And we decided that the way to counter that was to -- and this has been announced publicly, the way to improve that recruitment was to actually offer them the treatment after they've been in a period of control, not getting the drug, so that then later on, they could receive the drug and still get the benefit in that way, increasing the recruitment to the trial because it has been, as Philippe says, challenging to recruit participants.

Perhaps to close off the meeting for you to go home with something to reflect on, this team has adopted a mindset, I would say, an attitude where adversity is actually seen as a potential future benefit. And I alluded to the question Mr. Baum, who asked, well, when is the NDA going to be filed or when is the 105 study going to be completed? In the original design, comparable to other companies in the world that want to target vitiligo, we had a control group and an active group. The control group is those patients that does not receive afamelanotide. And the adversity of seeing that the rate of recruitment was not according to what we calculated, we designed this trial such that the control group is now receiving also afamelanotide. So out of the necessity to find a solution, we now have double data of those that were original, the active group, and the control group is staying on trial for 6 months to receive also the afamelanotide. Now the cost to the company is that you provide the drug both to the active and control group. But the benefit is that we have now double data as opposed to 100 patients. We're now going to get data on 200 patients. So I would like you to adopt and go home with the mindset that sometimes when you mine for information, you can actually get a benefit and an advantage of what seemed to be initially a disadvantage. And I'll leave it at that. Mr. Baum shakes no, so I assume that you are not in consent.

[indiscernible] initial control. That's going to add a lot off...

No, it does not. It adds a 6 months to it, 21 weeks to be precise.

[indiscernible] extra time for recruitment.

No. The patients are already recruited. Okay, I will say this, and perhaps you will then reread it back on the video, patients, who are now receiving the [indiscernible], the nonactive treatment with narrowband UVB, usually would not get the active group. In order to retain them in the trials, we promised them 6 months, 21 weeks of active treatment. So we get double data, which we had not anticipated. So you're correct, it's an extension, yes, of 21 weeks. But the benefit for the company and for the FDA is that we get data on all patients participating rather than a drop-off. So it is quite an interesting phenomenon. But I relish the feature that you think that you have an adversity. But when you dig deeper into it, you actually come out better at the end. And yes, I'll leave it at this. I think I've answered.

Thank you, Philippe. As the company has not received notice of any other business, I will now move to close the formal part of the meeting. This concludes the meeting. I thank all those in attendance and those watching live stream, and we wish you all good health and fortune. Thank you.