FluoGuide A/S (FLUO) Earnings Call Transcript & Summary

Hi, and welcome to this live Q&A with FluoGuide, who just released their Q2 report. And we are joined by CEO, Morten Albrechtsen, and CFO, Ole Larsen. And before taking your questions, they will give you a short presentation. So please go ahead.

Thank you. Thank you for having us. Yes, we just have a few slides just summarizing what have happened and where we are. So as you know, we light up cancer to maximum surgical outcome. So we work with uPAR in a target that is intelligent, is expressed the most where you need it the most, so that's the forefront of the cancer. We are in oncology surgery, so we help the surgeon and the patient to get complete surgery. We have shown 5 positive clinical results in different indications. And every year, unfortunately, there are approximately 20 million patients that will be diagnosed with cancer, and we have the potential to help them. We have partnered with the leading med tech companies in different types of equipment. And we was very pleased here in the first half of the year where we got both approval for our first regulatory trial in the U.S. for high-grade glioma. We obtained the Fast Track designation, and that's on top on the Orphan drug designation we have had early on. And we have the 2 ongoing trials right now. That's the high-grade glioma registration trial and then there's a trial in head and neck cancer, where we have reported the first part of it here before summer, and we have another 10 patients to be treated there. Our lead indication is high-grade glioma and focusing on the U.S. So it was really an interesting first half of the year. As mentioned, we got the FDA submission and approval for our first regulatory trial that's been cleared with them in a pre-IND meeting before. So we have directional alignment with them what is needed for obtaining approval endpoints and a number of patients. We then got the Fast Track designation. We got the trial approved. We completed the first part with the 15 patients in head and neck trial in Holland, Groningen. And then we make the reporting of the result where we actually selected a dose. We had the most position -- best position we could obtain within the surgical room, we could help the patient, and then it worked on all equipments, but I'll probably get more into that later. And then just we have just opened the site for the first U.S. site that we can enroll patients now in our registration trial for high-grade glioma. And this is a quite smart trial actually. I'm not the only one that have been involved with it, actually very little, but we have very good colleagues. And what they did is actually design it in a way where we both have a base case that is very predictable to have success. Of course, there's always risk when doing clinical trial, but the base case here is really good. And that's because of the endpoint we choose and that completeness of resection that's measured by MRI scan before surgery and after surgery. And we have already shown in the CT-001, the first trial we did that we are over -- way over that what is needed in this trial to be successful. And that was in a trial where the surgeon were not trained and where we had kind of a first experience with the drug. Now we have built a quite robust training program, so we are much better off. Then additionally, this endpoint is what agreed to with the FDA would carry over to the Phase 3 program that is to be repeated after or -- not repeated, but we have to be done as well after this trial. It would be high-grade glioma, and they will be -- the trial would be kind of completed in 48 hours for the first endpoint, which is the primary endpoint. Then -- and that's a smart aspect of this trial is on the secondary endpoint because there actually the more commercial edge to it and really what could help patients beyond just having completeness of resection. And that is that it's been shown that FG001 with a high likelihood passes the blood-brain barrier. And the problem for patients with high-grade glioma is that they have cancer behind the blood-brain barrier that today is not visible. And that is the potential that we can visualize that and actually help the patient additionally with it. That secondary endpoint, if that comes out positive, it's really a game changer in brain surgery, tumor surgery. So this is why it's smart as a good robust base case and then there's an upside on the trial.

Yes. And turning over to the financial highlights. In first half, we had other external cost of DKK 18.3 million. And if you look above, you'll see that it consists of R&D and admin. Admin is including investor relation costs and also sales and marketing costs, and they were DKK 5.1 million in the first half. R&D is, of course, our 2 clinical trials, CT-005 in head and neck and CT-006 in aggressive brain cancer, and they consisted of DKK 13.2 million in the first half. Then we have our staff cost that consisted of DKK 9.7 million in the first half and finance, which is primarily the interest from our loan with Fenja Capital of DKK 1.6 million. And then the tax credit so far this year, DKK 5.2 million. There is a cap of the tax credit of DKK 5.5 million. So we will reach that during Q3, and then this one will not increase. Then that means that we have a net result of the first half of minus DKK 24.6 million. If we go to the balance, we have assets of DKK 65 million by the 30th of June. And of that, DKK 50 million was our cash position and our securities. The securities has since expired, and are now in money deposits like the -- primarily like the rest of the cash. The tax credit of DKK 11 million is the DKK 5.5 million from 2025, which we expect to be paid out in November, December and then the DKK 5.2 million that we have collected or gathered so far in '26. The liabilities consist of equity of DKK 31 million and then the loan that we have with Fenja Capital of DKK 27 million. And if you look to the right on the cash flow, we have burned DKK 29 million in the first half. Of that, DKK 28.2 million is due to our operations. If we look at the outlook that we announced in November '25 in connection with our Q3, you can see that all our goals for first half was met apart from one, and that is the enrollment of the first patient in the U.S. Phase 2 trial for HGG. And as Morten just mentioned, we got the final green light for the first site in the U.S. today. So now we can start enrolling patients in that clinical trial. If we look for H2, the goal is to optimize the use of FG001 and the laser system in our PTT-PDT, and we will present a plan later this half. Also in brain, we will have the interim results of the low-grade glioma investigator-initiated trial Rigshospitalet, the last 10 patients, as well as we will present tumor brain tumor plan also in second half. Then we came out with an announcement on 2nd of July, telling that we wanted to amend the protocol for the head and neck trial, meaning that the interim result for the additional 10 patients will be delayed into '27, in the beginning of '27. And we are still on track for an additional partnership in the second half of this year. And I think that concludes our presentation.

Thank you so much. We will move on to the question part. And we've had a couple of questions sent in already. And let's start with you, Morten. First question is very straightforward. Why aren't any patients recruited yet in the HGG trial? And as this writer points out, it's been delayed 3 times.

Yes, that's correct. We ran into the summer holiday in the U.S. So we missed some site-specific -- it was delayed some site-specific approval and tests. But the important thing here now is that the FDA approved our trial. They granted us a Fast Track. We have the first site to have a green light today. We have had patients that just couldn't be enrolled because the formality was not in place. And we have 7 more sites lined up very close after.

It happened.

It's very irritating, but it happened.

Yes. Let's bring you in here, Ole, as well. A couple of months ago, Rigshospitalet announced that they will conduct a bigger H&N Phase 2 trial, sponsored by them in 2026, '27. Have you got any thoughts on that?

Yes. I mean it's more or less ready to start. And Rigshospitalet, who is in charge and control the study, will inform soon. And I can say that it's within robotic surgery and it's in head and neck cancer. And we have some public material, a detailed protocol has been submitted to the European database for clinical trials where you can see the details on the trial.

And turning to you, Morten, I think, on this one in Morgenbørsen last week, you confirmed the following about the H&N trial Part 1, and I will have to read this, the 30% to 40% that normally need reoperation. They were cured of cancer in the study as in all cancer removed. So 100% of the patients in the trial were cured. It's possible to assess the margin live without adding operation time, and that's because of you -- well, because of you -- of your product. It was done with existing equipment in the operation room. Can you confirm that all these statements are correct?

Is not completely correct. I would like to confirm what is done. So first of all, I would say that in the trial -- previous trial, 003 that we did in head and neck, importantly there, you will see that it was 16 patients that was enrolled and light up all patients. And this trial has been public in the public domain. So all the details are in the publication. It's interesting, it was done with a camera that was optimized for fluorescence-guided surgery and produced very good result, not surprisingly. This trial, for the 005, the one we just reported here, the key thing for us here is that we don't just want to do, what I say, nice publications and nice trials. We really would like this technique to get out and help patients in all the corner of the world. And if we should do that, there's a couple of things we need to do, beyond just getting a lighting up and beyond just using it on a very specific equipment. So first one, we need to get all the line, the regulatory line. It has to be approved. We have to have it to work on multiple equipment that already is out there. And they may not be exactly as good as this very specialized equipment, but they are out there. And then last but not least, we need to have a commercial case. So going out having approved and it can be seen with the camera, we cannot -- no one want to buy it, I mean, helps no one. So we also need to have a commercial case. And I think that the trial -- what we did confirm in the trial were that we selected a dose. We also selected that the most interesting positioning being helping the surgeon in the surgical room, assessing the margin is the application we go for. So that's the most valuable because it fits into the workflow. So it's the most valuable for patients and for us and for shareholders in application. We did prove that it worked on all the equipment we tested, and we have different kind of equipment. So it was actually as good as it could be. Then what we have said before is that we have almost 500 images for each patient that still is being analyzed. So some of the things that was mentioned is still being analyzed. And as soon as we have them, we will get out with it. So we selected the dose, the most valuable value proposition in the surgical room, work with all the camera, that's what we have a result for now.

I will just read this next question straight off as well. There is a moderate number of investors that think it's a little bit strange that you have to wait until 2027 to release the margin data at different conferences and articles and so on in different mediums. Are you still analyzing? Or is there some sort of agreement with the partners and the professors at UMCG that is stopping this release and they finish by saying that they are very anxiously awaiting them?

Yes, that's fair. And there's a couple of things to it. No, we haven't -- we don't have the data right now, because if we see something light up, we need the pathology slide as well to confirm if it was cancer or no cancer. So we need the whole circle, so to speak, before we can analyze it. We cannot ask the investigator to draw on all these 500 images for all the patients and then redraw afterwards. It would be -- of course, it takes time, but that's not the point. The point is more that we could impact the result of it. So we need to do it once and only once. And then last, then we will come out with the data when it's there. This is a sponsored study. So it means that we own the data and we can come out with the result when we are ready. But when there's no meaning coming out with them before we're ready, we could say something rubbish, which will make no sense. So really, for us, it was important to select the dose, work with the equipment. We build this automated margin assessment that we can implement into the next 10 patients, and we put an amendment for that. So we are more prepared for a regulatory trial after this one here. So well, that's all we can say now. I would love to say more, but it's not serious really.