Immunovia AB (publ) (IMMNOV) Earnings Call Transcript & Summary

Hello and welcome to the Immunovia COVID-19 Update #4 Conference Call. My name is Caris, and I will be your coordinator for today's event. [Operator Instructions] I will now hand you over to your host, Mats Grahn, to begin today's conference. Thank you.

Thank you, and good afternoon or good morning, depending from where you are. Thanks for joining in to the update #4 of the COVID impact for Immunovia. We will today go through the agenda, as we normally do, our response to the COVID-19 pandemic in general, but the focus of today will be the very positive news that we now can open and have opened our laboratory in Massachusetts in U.S. And then we'll go through the remaining steps to launch, commercial preparations that's ongoing and touch upon the prospective studies. Let's start with the response to the COVID-19 pandemic. As we have talked about before, we have continued with our work at -- from home policies, and we were, as a company, very used to running virtual meetings before the pandemic as well. But now, I would say, we've gone from good to excellent or more than excellent. We are, as many companies, frequently using it in a very, very efficient way. And that's great. We still, of course, follow guidelines and orders from authorities. And now, it's going in the other direction that guidelines and orders are releasing the restrictions and that is great, particularly for us in the Massachusetts area. When it comes to Sweden, we still have the full operational R&D labs, clinical lab and production running. It, of course, has always been a daily management of task allocations when people are forced to be at home, not because they have COVID, but because they have some symptoms and so forth. But that's been managed very successfully over the whole period, and we are very thankful to the loyal and extremely flexibility that our employees have shown to work for this period. And that goes, of course, also for our U.S. team, where the people have worked from home in a diligent way over the period, that's gone until now. And as I said, in U.S., the clinical lab has all the time been extremely well prepared with detailed plans for the sales start. We have mixed and matched and moved as many things we can between us to minimize the impact. And now, on the May 18, Massachusetts began this 4-phase reopening plan that we will discuss today in this call. Next slide is when it comes to the -- or access to our needed reagents, consumables, chemicals and instrumentation and so forth, the situation is still completely under -- fully under control. We have everything we need, and we are moving forward without any issues on that side. Our clinical collaborations, as you know, when the pandemic really hit the hospitals, they did, in general, across both Europe and U.S. stopped doing clinical trials of any kind, including sample collections. We have now seen that some of our clinical collaborator hospitals have restarted sample collection and also on the clinical trial side. Not all of them, of course, but it's good signs, and it's definitely moving in the direction we want. And we are getting more and more open access again to the programs we have to cap with our clinical collaborations. So also on this side, we see very positive movements starting to happen. When it comes then to the main topic of today, which was the big risk for us that we couldn't get into our lab in Massachusetts and execute the plans fully there. Now the Governor has, starting May 18, put this 4-stage program in place. And we have -- are in the Phase I, and that means that we have begun to open the lab this week, and we are in place now moving forward, which is really great news. And that definitely means that we are on track for the previously realized sales start target of Q4 2020. So we now have control ourselves over the events moving forward, and that is really positive and energetically for us to move forward in that way. Good news. When it comes to the plan of reopening, I'll just give you some more details on that. So we are in the Phase I, or Massachusetts is in the Phase I start where a number of limited industries are allowed to resume operations with, as they call, severe restrictions. They are okay for us. We have done everything we need in the lab in terms of keeping people apart and so forth, so we can work going forward. And we are part, as I said, of this Phase I, and we have now people in the lab starting to set everything in action. Again, that means that, as I said, we are on track to the plans that we have talked about at last meeting. A little bit more detail why didn't we get in on May 18, that's because the Phase I program is in actually -- in a staggered approach. So on May 25, it was allowed for companies that work with lab space to start activities, and that's where we are. Of course, that includes also our office space, actually, so it's available to us as well under the current restrictions, including social distancing. And we have all the policies in place and signing and so forth and work practices. And that's we put in place. It's all there and the staff is ready and moving in right now. So that's great for us. That means that our sales start target of Q4 is on track and remains as before, and we do not intend to modify that now moving forward. We are now running fully towards this goal. The verification study, as we said before, will be released -- finished in Q3 and validation study, both in -- particularly then in U.S. part will be leading up to the sales start in Q4. And that means that we -- the most important message that we remain the first-to-market with an accurate test for detection of -- early detection of pancreatic cancer. That's the main importance of this. Nobody is going to be there before us. Remaining steps, as you know, from previous meetings, we are on track here, running the verification study right now, and that will be followed by the validation studies then -- it will be in 2 parts, one for CLIA/CAP in the U.S. lab and the one for CE-IVD in the Lund lab for Europe in parallel, although this European one takes a little bit longer as always planned for. Going into a little bit more details of it, the verification study is running on known samples. We have all the samples in-house. And we have had, as you know, a successful collections that gave some excess samples that we now have been reallocating to the validation studies to prioritize that and to make sure this gets there. We also had on the validation study samples that were collected in some hospitals, particularly in U.S. and very important for the U.S. team to get access to. But we could not get into the -- or get them sent to us during this close period. That has now been resolved for the most important samples. So we have -- and that's also great news. We have them under our control that will be used for the U.S. validation study as soon as the verification study is finalized. So good news on this side as well. And as we have talked about several times here, the remaining steps to launch here, when it comes to validation study, that part is run in 2 pieces; one for the CLIA/CAP U.S. and one for the CE-IVD in the Lund labs. There are also, of course, other activities that goes on that are not time prettier that leads up to the validation study, and they can now resume at full speed in the U.S. lab as well, which is fantastic. So let us move over to the commercial launch preparation activities. When we planned for launches and which we have done before the pandemic, of course, it's important to reach the key targets, the customers, the clinicians of various kinds that are important to us, including the pancreatologists, the gastroenterologists and also some primary care important meetings and so forth. They have clinical conferences, and that's where you get the best impact of your message. We also worked in parallel with the patient organization, as you know, with large meetings to create awareness and demand for the test. However, all these physical meetings were canceled or postponed or in some best cases turned into digital meetings. And therefore, the marketing -- sales and marketing organization has worked really hard to continuously develop digital plans and activities instead and increased these ones to make sure that the launch will be done in a very efficient and successful way in spite of any impact of the COVID-19 situation. And I'd like again to go through the 6 key activities here, how that has been done in a very, very good way. We have, on the top here, the patient organization events, meaning this creating awareness and creating demand among the risk people who visit these ones and also inform the clinicians that take part in these ones. That was not possible, even not physically, of course, yet, but we have then turned it into virtual walks. And in the first one, together with U.K. patient organizations that will replace a large meeting in London, and that was planned. That will now be even a better concept in terms that it can also be used by engaged patients in -- or people in the organizations, patient organizations that can use their own social networks to spread the message, the information and so forth forward. So that's a concept that we're now taking further and moving also into particularly the U.S. market in various ways. And that will start here in June and then roll the whole time during the time up to launch and also afterwards. When it comes to getting access to the clinicians and get them informed in each hospital, one has to meet them at a time when they're actually accessible. You can't just as a salespeople walk in and think you can meet them at any time during the work hours because they're busy all the time with their patients. However, they do eat lunch. And therefore, we always used in, also our previous companies, and in many ways, an efficient way, which is called Lunch & Learn now. That is to go into the hospitals and have meetings during the lunch time with sometimes bringing the key opinion leaders there that certainly brings their attention. That concept has now also been transformed into a virtual tour package, and that has some advantages because getting access to the key opinion leaders and having them meeting up at least once is -- together with us and inform the gastro people, for example, in a large shelter system is really, really efficient. However, they are not having a lot of time to travel around and don't want to travel and cannot, for time reasons, do that to a large extent. When we run it digitally, we get increased efficiency in these meetings, and we have great hopes for this package here now. And the third point on the right side of the slide here is the digital communication. We are mapping which are the most efficient online channels related to our target groups in order to spread the message in a best possible way and to drive people to our website where we invest heavily now for major digital launch campaigns during the coming period and to launch afterwards as well, of course. That includes information and material both for the clinicians of various types and kinds and also for risk individuals and so forth. There is then an important piece on the left side here called digital sales tools or rather sales training package as well. When you bring on -- bring up the sales -- build up the sales organization that we are doing right now very successfully as well given the times, it's prone and that it's a lot of very talented and experienced people that are very interested to move into Immunovia, given that some other companies in the market have severe problems. And therefore, this is seen as a fantastic opportunity to join into a company with new exciting tools to sell. However, when you bring on salespeople, you have to train them, you have to give them the right tools and how to use them and make that a really efficient package. Including training, they need presentation brochures, posters, collaterals, ways to sell and also training how to sell virtually because you can't bet on that all hospitals are open right away even in the autumn here. So we are, therefore, having a digital package, a training package that we run with new salespeople coming on and experts in digital sales, training them on top of what they already are experienced or are doing, of course. So that is a nice package put together and is now useful as we step-by-step onboard the salespeople. And of course, finally, at the launch, there will be a big launch event with presentations, including key opinion leader speakers and so forth to mark the whole thing. So this is a very comprehensive package that has been put together by our sales and marketing team. And once we now see it after the fact here, after responding to the COVID epidemic, we start wondering as to why didn't we do this from start because we now believe that this will actually be an even more efficient package for the launch process and beyond than we had planned from the beginning. So that's great. Finally, on this path here, also, I would like to say a few words about the prospective studies. It's like before that some of our -- some -- one of our studies, the PanFAM-1 has been affected because the risk people have not been able to enter their regular yearly meetings or biyearly meetings at hospitals and do their imaging and take their blood samples for us due to the closedown of the hospitals and so forth. Even that some are now starting up again, particularly in Europe, and it will come also in U.S., there has been an impact as before, but there's no change from previous meetings. The PanDIA is running fine, as we have said before. South Sweden has not been effected very hard at all. But the pandemia -- and it's being going on all the time, actually, collection of new onset diabetic samples. And we have plenty collected already anyway for the -- what's needed for the next step interim analysis that will happen after the validation of the test. So -- and PanSYM is in a planning phase for the interventional phase that we have always planned to start after the launch as well. So there -- and now the clinicians start to get accessible for the detailed protocol definitions and so forth, so that we still anticipate to have on track for interventional phase starting at next year -- early next year. So there is a pretty okay situation, really good. So this one remains the same, summary of the studies there. So all in all, to summarize, our COVID-19, thus far has been successful. We are now even more happy, of course, since the lab in Massachusetts, the main risk we had has been removed that risk. And the team is back in the lab, and we can execute on the plans that are in place. That means that we are on track for the Q4 2020 sales start. We do remain extremely focused on the launch for the company, and that's the major, major focus of everything we do. Because we will be the first-to-market with an very accurate test for early detection pancreas cancer. And that is great to be first-to-market solution for an addressable market opportunity of, in total, over USD 4 billion. And after hard and long work, being able to start the delivery to patients and clinicians in strong need of this and thereby also starting the penetration of this huge market for Immunovia. So with that, I would like to open up for questions. Do we have questions?

Yes, we have one question in the queue from the line of [ Peter Hallgren ].

Actually, we will be aware quite a few of your competitors have been releasing sales targets and penetration targets the last month or so and been quite significantly well rewarded for it. I know that you want to wait until when you've started to sell before providing projections and penetration targets. Why do you think this first period of sales will provide enough evidence to allow you to release sales forecast and penetration targets? Would it not be more useful to look how well similar golden standard products have done during their first few years?

I think everyone can take a look on, for example, exact that you compare to and see how many percentage they have penetrated in the first 4 years of market and so forth and you can -- if you want to draw conclusions out of that. However, it's not exactly the same market. It's an absolutely new situation for both clinicians and risk people and so forth. And then we have, right now, on top of that the uncertainty of how will the situation be in the market due to the COVID once we launch and so forth. So it would be not prudent to start doing that right now. And we will, as I said before, get back with predictions as we move into the sales phase.

We have more questions in the queue. The next question comes from the line of Lars Hevreng.

Mats, could you just remind us since the anticipated timing for broader reimbursement support for the use of the product in pancreatic cancer testing, what's the time line there? If you just could please remind us.

Yes. Absolutely. That is a key -- it's a key element, and it's our most important priority after, of course, the sales start. And it will be the top priority from the sales start and onwards because that's an extremely important factor when it comes to the previous question, the penetration rates, really. So we -- and one element that is very important in this step is the results from the prospective studies. You don't need all of them at once, of course, but to start with the key one, for example. And we are anticipating, as you have seen, to be ready with the interventional phase at the end of '22. And that's what we also have as a target, end '22 or early '23 for the reimbursement decisions, the most significant first big ones.

Okay. And that -- will that be a broad coverage? Or will it be specific by patient -- by risk groups, so to say?

Yes. You have to show data for the risk situation that you are asking for reimbursement for. So it will be discussed or decided by the reimbursement organizations based on the data we can provide. So the more data from the different studies we provide, the broader it may be. But on the other hand, if you have reimbursement for one of them, it's also applicable for a broad use by the clinicians in general since there are some overlapping situations. As soon as they see that they have a risk patient, you can argue for using it under almost any of these ones.

[Operator Instructions] The next question comes from the line of Alex Cogut.

And really nice to see that everything is on track. So I just like to understand a bit better, what would be kind of the next steps following the interim readouts of the prospective studies? I mean, obviously, the trials... [Technical Difficulty]

He dropped off there.

Apologies. His line has been connected -- sorry disconnected. In the meantime, we will take a question from Viktor Sundberg while he redials in.

So I wonder if you could give us a bit more flavor on the patient organizations and what the pent-up demand is like out there? Maybe how many patients are registering in these organizations? How many that are on your waiting list? And are there any organizations that are more important, less important and so on for your commercialization of the tests when that starts -- when that's ready?

Okay. We work -- so first of all, we work with quite a number of the patient organizations. So it's -- they are a very, varying size. There are 22 patient organizations in U.S. The 2 largest ones are called PanCan U.S., which is one. And the other one, second largest is called Lustgarten. One is basically headquartered on the West Coast and the other one in the New York area on the East Coast, but they are active across the country. They have slightly different -- and then there are, as I said, about 20 different ones that are much smaller, but they can be very important because they have different focuses. Some of them have a huge organizations like PanCan. They have 100 people fully employed, where a large percentage, up to 80%, I think, are working with contacts and support to affected families, which is, of course, really important. But Lustgarten has a lot of activities when it comes to support new products or new research in this area, but they also run big walks and information at this. Then you have smaller organizations that specialize in other activities. Some of them are doing a lot of lobbying, for example, to decision makers from the Congress and downwards. Other ones are supporting even families or people, affected people, with money if they need to get access to new treatments or new tests or things like that. So there's a variety of focuses on these ones. And they also are geographically located and are strong in local areas sometimes. So we have a hope in U.S., particularly whole palette, if you want to call it the whole menu of different ones that can be very good for various reasons. The 2 main reasons -- once we work with -- for the big walks, where 2018 and '19, we met 60,000 people in these meetings in total. That is PanCan U.S. and Lustgarten. So that's -- in that sense, we had a lot of collaboration with them. When it comes to awareness, for example, you may remember that we were able to run a Time Square campaign for a extremely small fee because of a collaboration with another small patient organizations that managed to get that offer and needed our help to get it done in a good way. So that's why we -- in that sense, we created awareness to a huge amount of people in the world's most busiest town, in a place where a company like us never could afford it if we haven't gone that way. So that's why we look upon it that way. That's U.S. In Europe, I would say that the most well-organized and active patient organizations are in U.K. There are 2 of them, main ones that we work with. One is very much focused on creating pressure on -- sorry, lobbying and changing policies and doing awareness, creating awareness of the situation and are also extremely active in coordinating the whole European network of patient organizations. That's an extremely skilled leadership there when it comes to creating awareness, doing important work when it comes to raising awareness, particularly on every level, people, politicians, parliaments and so forth. We work on them -- with them. And they are also very diligent to work on the planning for the virtual tours now. That gives you a palette. Other organizations in Europe are either small and growing or -- but they also collaborate in the World Pancreatic Cancer Coalition, which is a part that we take part in as well. So the big ones support the smaller ones with tools or material or information and things like that. Yes, and in total, there are 54 patient organizations globally.

Yes. And can you give some flavor on the pent-up demand among these organizations? Do you have a waiting list of patients? And can you give us any flavor in terms of how the demand...

What we do is, in these boxes, of course, to collect information on -- contact information on people who express interest to be getting our test, and that's why we build up our own database of -- keep them constantly informed until the test comes here. And we have thousands of people in the list there. They also contact us directly through our website or after articles about us in relevant magazines and so forth. So we constantly get contact with -- that's almost exclusively people who have close relatives that have died of pancreas cancer that are extremely active, searching themselves. Google and the social media is a very important tool in that aspect.

And will physicians be any kind of gatekeepers here or the patients does everything...

Yes, in a sense, yes. Before -- no, no. When you order a test or you want to be tested, you have to go to your clinician and make them order the test. It's not allowed to -- as a private person in any country to order a test directly in this -- in serious diseases like this one. That's why we have worked with the patients -- sorry, primary care organizations in U.S., for example, to make the test requisition a material that they would like to see extremely easy for them to sign their requisition. And also, that's why we worked a lot with the logistics system to make it super easy to get the blood drawn and so forth that are important areas that is crucial for penetration.

And just a final question. And they are okay so far as you know with the retrospective data or some waiting for prospective data, which could be -- argued to be more robust in terms of...

I can tell you that the risk people or patients themselves are not waiting for data. They are waiting to be able to get their blood draw down and to get the test done. That's it. That's the key.

[Operator Instructions] Another person has contacted from the line of [ Juan Lagadinos ].

Mats, thank you for frequent updates. I was wondering, a couple of years ago, you made the sales guidance of SEK 250 million to SEK 300 million in 2022, I believe?

Yes.

And SEK 800 million to SEK 1 billion into -- in 2024, I think. I haven't heard you comment on these for quite some time.

Yes. That's our goals.

Same numbers, same years?

Yes, at the end of this year, we will -- we already have these as targets.

Thank you. There are no further questions. I'll turn the call back to your host, but the Q&A box is still open.

This is Julie Silber, Director of Investor Relations. And I have a bunch of questions online that I'm going to pose to you, Mats, right now. The first one is coming from Alex Cogut from Kempen, who unfortunately got cut off. His question is: could the interim results from the prospective studies accelerate the time line to get reimbursement coverage in the U.S.?

It is definitely possible. It is nothing you can promise, but it is possible, yes. There are programs, for example, called coverage with data collection. That means that you get some reimbursement while you're collecting the data from the interventional phase as well. And of course, we will discuss opportunities like that and see how far we can get. And we have had a constant dialogue for many years with a patient -- sorry, the payer organizations. That's an opportunity. It's an upside. It's nothing we promise, but it's definitely something we will work on.

Great. Can't tell if there's a follow-up question because we've had some phone issues, but we do have more questions. So we have a question to you, Mats. Can you reiterate why the verification study was postponed, even though we had all the samples and we're running it?

Yes, sure. When we had a task in both sites planned, both in the lab in Massachusetts and in Lund here running full speed, mainly focused here in the verification study and other production preparations, quality control methods and so forth. In the same way, the lab in U.S. had a task that should have been done while they were shutdown. They could, of course, then get the sign task that required only lab work, also from the Lund piece. And at the same time, we had to reallocate a task from the Massachusetts lab to the Lund lab that was not a written plan to be done there. So -- and that's what you have to do when you mitigate risks on the situations like this. So if you increase the workload significantly in the Lund lab, and you can't just employ people with the skills, even more people, you have a limited number of resources, then some things will take a little bit longer time. So what we have done is to optimize the time to market, which is the key thing, making the shortest possible total time plan to get a launch in Q4. And that meant a little bit of reallocation of task and that with a verification study drifted into the first part there of Q3.

Great, Mats. We have a few questions on some of the pipeline projects and the status of those. Could you, once again, share some more information on RA and Lund?

Yes. When it comes to the Lund piece, we are working on the latter part of that project, mainly the analysis and some work that needs to be done, getting more information on the sample and so forth. But we have done the lab work. However, we are prioritizing, of course, the PanCan-d. So there are time slots when it's possible for people to complete this work. We still project that we'll be able to do finalize that towards the end of Q2 here. When it comes to RA, we now, since a while, have all the samples from the Leiden in Holland and also which took a while to get all the data on the patient's condition, the clinical data, and also to discuss the study lay-up and so forth. And that one is not run or anything started in the lab, physically, although planning is ongoing. And we have reallocated people from this through the PanCan to make sure that we hit our time lines there. So I cannot promise. It will most likely not be done in Q2 here, but -- and we'll hope to be read by Q3, but it will always be a top priority on the PanCan work, of course. So it's not 100% sure promise there. But we have the samples in our hand, and the work can be proceeded once we have slots open due to -- in sync with the PanCan work.

Great. Thank you. And then the last question I have here online is about the lab in Massachusetts. Was there anything specific that needed to happen once the door opened to get back up and running or everything is perfect since the day it was -- the door was closed?

Yes. Yes, that's unfortunately not the case. When you close the lab, when you get back, you have to recalibrate the equipment. I mean you even had to -- they really had a lockdown there. So the doors were locked by the owners of the facilities. So you have to get in physically as well. That's been sorted, of course. And we also had to conform to the restrictions by the government in Massachusetts, and that means that we had to put up correct signage. We had to make sure that we could operate with the personnel without -- with social distancing and things like that. So there has been a number of talks, and we have to get in actually some -- for the calibrations of pipettes and things like that, we had to get in external support, as you always do in these cases. But it's running really well and they are diligently -- they knew about this. So it had been planned for, of course, as the team was working from home. So that work is quickly moving forward, and we will particularly will be able to move forward. One important thing that we didn't have to do with the lab physically, but also as I mentioned before was that some of the key samples that we need for the U.S. operations -- planned operations there were, let's say, locked into some of the hospitals. And that's been resolved during this week as well. So we're getting access to them now. That was another important piece. But yes, so some work to get running, but it's being done very diligently, and we are very soon up to full speed there.

Great. We just got one more question online. Can you please reiterate when, in Q4, we might be able to expect sales start? And a follow-up to that would be, could we have a risk that we get possible more delays because of the CLIA/CAP accreditation, not having the resources because of COVID?

Okay. I think I understand the question. And it's some with a lot of insight in how things move, and that's great to hear. Yes. Now when we are into the lab, say, you have to look upon the next risk always. Although it's smaller, it always have to be -- that's how we work all the time to minimize risk or mitigate it. And there is one, and that is that the inspectors from CLIA/CAP or authorities have, of course, also been in shutdown. And thereby, there has been a number of tasks for them from various companies put together, and there may be a bottleneck when it comes to the -- getting access to them at exactly the right time. They have by operational law, basically a 30-day period, which they have to do the inspection but if they have -- after you tell them that you're ready. But that can, of course, be strained for them now for a while here, but we have a good contact and lots of work going on in that area to make sure that we have a good pace in their queue, so to say. But that's -- as I say, it's probably the uncertainty, is this going to be early Q4? It's going to be in the middle of late? And that's why we say Q4. But it's going to be Q4.

Great. Thanks. That's it for the questions online. Are there any more calling questions?

There are no further questions on the phone line either.

Okay. Then I would like to thank everybody for listening. And it's been a pleasure, and I like to get a lot of questions. So thanks for your interest and activity in this level. It's always a pleasure to talk to you. And we'll keep updating you, but now we feel we have most for the time being with the COVID at hand. So it may take a little bit longer. Hopefully, if something happens, we'll update you. Otherwise, we just proceed towards launch of the first test for early detection of pancreas cancer in the world from Immunovia in Q4 2020, which we all look forward to. Thank you, and have a good day.

Thank you for joining today's conference. You may now disconnect your handsets. Hosts, please stay connected.