Lifecare ASA ($LIFE)

Thank you, everyone, and thank you for joining Lifecare's quarterly presentation for the 2026. Before I go into the details of the quarter and the highlights, I want to emphasize that this has been one of the most eventful and transformative portals in Lifecare's history. On the positive side, we have reached several milestones that confirms the maturity of our platform. This includes that we have met the milestone of reproducible implant manufacturing that has provided us with a confirmation on a system level functionality in vivo. Based on stable implant performance beyond 12 weeks in real-life conditions. We have also reached the milestone of achieving the CE mark for our implant electronics which obviously is an important regulatory and operational milestone for the platform itself. We have also, throughout the portal have had some more challenging developments. Our first-in-human study application was not approved in its submitted form.Additional documentation and validations are required. Our Chief Scientific Officer has transitioned into a consultant role. And based on a strategic reassessment, we have also decided to discontinue our German operations. This means that we have, unfortunately, had to say goodbye to several highly valued colleagues in Germany who have contributed significantly to LifeCare over many years. However, this transition in the German operations has also resulted in certain accounting effects that you will see from the numbers that we are reporting on today. And it's a bit important for me to underline the fact that even though there are accounting effects, they do not have an actual cash effect on the contrary. What we see, based on the discontinuation of the German entity. We see that we are moving towards a leaner and more scalable operational platform going forward. We also do expect quite high cost reductions. Rather than reviewing these events in isolation, we have used the period as an opportunity to assess and strengthen both our operational and regulatory strategy. We have initiated important adjustments that we believe will improve the execution, simplify our regulatory strategy and position LifeCare efficiently for the next phase of development scale-up and commercialization. I want to summarize the operational progress in the first quarter across 4 main areas: the first being product validation. We have demonstrated that the fully implanted system operates in vivo as designed based on reproducible implant manufacturing. We have also seen coherent glucose signal behavior from the raw in vivo data. On the longevity and performance side, we are continuing our study and we see a stable implant performance beyond 12 weeks under real-life conditions, and this is a performance that is still ongoing. On the regulatory side, we have met an important inflection point in the quarter. Based on the feedback from [indiscernible], we have done a broader reassessment of our clinical and regulatory pathway. We have simplified our strategy towards a single pivotal CE mark study that will lead to execution efficiency and also capital efficiency. And on the operational side, we have initiated the transition towards manufacturing in Bergen including a more centralized and scalable model, where we are consolidating our operations in Norway and in the U.K. And taken together, we believe that Q1 marks a transition from feasibility validation towards scalable execution, regulatory progression and market readiness. One of the most important technical milestones in the quarter has been the demonstration of the fully integrated CGM system that operates in vivo as designed. We see glucose-related Cigna behavior that is based on raw in vitro data without calibration or post processing. And this is confirming not only the underlying sensing principle but also the integrity of the full implant architecture in a wireless living system. Strategically, we do no longer question whether the system fundamentally works rather how we optimize performance, execute the regulatory pathway and scale production in a controlled manner. The longevity study continues to generate very important operational and biological data and has continued to do that throughout the quarter. We do still see stable implant performance and as mentioned, beyond 12 weeks under real-life conditions. And from a strategic perspective, this is highly important. The long-time durability and predictability over time are obviously critical requirements for any implantable sensor platform. The results we see materially reduce the durability risk ahead of our future human studies. And this obviously strengthened our confidence in the long-term potential of calibration-free glucose monitor. We have simplified and also strengthened our regulatory pathway in the quarter. The feedback we've received from [indiscernible] led to a broader reassessment of our overall clinical and regulatory pathway. And we have optimized our overall development pathway going forward by strengthening our regulatory execution. We have an engaged Link Medical as clinical advisers and in addition, initiated advisory interactions with prospective notified bodies. The main outcome of these actions is that we have simplified the clinical strategy centered around 1 pivotal CE mark clinical investigation that will then replace our previous 2-step approach. This will reduce execution complexity it will improve our capital efficiency, and it will lead to a direct and more predictable route toward clinical validation in the future market entry. As the remaining development focus is increasingly incented on documentation, validation, quality system and production readiness. Another important milestone in the quarter is the fact that we have completed the CE marking for our implant electronics under applicable EU directives. And this leads to the statement that our veterinary product configuration that contains these electronics is now basically cleared for commercial sales in Europe. However, we view this strategically. This is, first and foremost, an important validation of the regulatory quality and manufacturing platform that confirms that the electronics architecture itself mean meet stringent European safety performance requirement in a production level configuration. And this has an important significance beyond the veterinary segment itself. The milestone strengthened the broader regulatory foundation for the platform and it supports our continued development towards future clinical and commercial readiness. In the quarter, we have executed on a broader transition toward an operating model that is more scalable and integrated. Following the maturation of technology and production processes, we have identified an increased need to bring key capabilities closer together. Across manufacturing, quality systems, regulatory work and product development. We have initiated a transition toward a more centralized operational structure, where we are moving our manufacturing activities to Bergen. And consolidating our overall operations in Norway and in the U.K. The overall objective of this is to improve operational control, reduce complexity accelerate iteration between development and manufacturing and also strengthen the platform for scalable clinical and future commercial supply. Q1 marked an important structural transition for LifeCare Collectively, the milestones that we achieved during the quarter strengthened the maturity of the platform across our validation, manufacturing, regulatory positioning and also operational execution. Our immediate priorities are increasingly centered around execution, where we look forward to finalize the updated regulatory strategy, continued system optimization, and strengthen manufacturing and quality systems ahead of future scale-up. As Q1 marked the structural transition from feasibility validation toward operational execution, regulatory progression and scalable product realization. Finally, this slide summarizes how we currently view the pathway forward, following the developments that have gone through and also based on the strategic reassessment initiated in the first quarter. I want to emphasize that we are still reassessing parts of the regulatory pathway and the broader operational strategy, including ongoing transition of manufacturing of operational activities toward Bergen. And as a result, we have intentionally moved away from on this slide, communicating specific timing milestones at this stage. As we are focusing on establishing a simplified, scalable execution-focused pathway toward clinical validation and future market entry. We do expect to provide a greater clarity and more specific timing guidance as this work progresses. And our ambition is to communicate a more updated and detailed road map in connection with the next quarterly report. The work completed to date include human proof-of-concept data, longevity and biocompatibility results, reducible implant manufacturing and now also a system level in vivo validation and this provides a significantly stronger foundation for this next phase. The key [indiscernible] fact to remaining includes regulatory progression product readiness, financing and strategic partnerships, which together will support progression toward clinical validation and future commercialization. With this, I want to hand over to our new CFO, Petter Nielsen. This is his first quarterly presentation for LifeCare. We are very happy to have him on board. So Petter,please take the stage.

Thank you. Yes, as Joacim just mentioned, I am new to the company, for those of you who have been following the company for some time will recognize me as a new phase. I joined LifeCare in April as the CFO, and I look forward to working on developing the company and projects going forward. So just a brief introduction. I some professionally from a different roles, including both CEO and CFO. But of most relevance for LifeCare, I was previously the CFO of a biotech company, BergenBio, which IPO-ed on the Stock Exchange in Oslo in 2017. So through that position, I was involved in drug development and multiple clinical trials across the U.S. and Europe. So I am familiar with the space in which LifeCare operates. So with that, I hope to be able to contribute to the advancement into the clinic. And also the future commercialization of the company. So if we then move on to the profit and loss. As Joacim briefly mentioned, we do have some effects related to the reorganization and strategic reorganization and operational reorganization which is primarily linked to the wind down of our German entity. These 2 hit the Q1 report and we have, as a consequence of this, recognized a NOK 12 million loss on impairment related to the German wind done that is ongoing. It's important to say that these effects do not have a cash flow element. So in Q1 2026, we recognized NOK 7080 million -- sorry thousand, in revenue related to recognition of government grants. Our employee benefit expenses amounted to NOK 8.5 million, which is in line with Q4 and about NOK 1 million below Q1 2025. We are expecting, and we will be seeing lower levels of employee benefit expenses going forward, partly in Q2, but most the larger effects we will see in Q3 and onwards. And we are expecting these reductions to amount to around 35% of the current cost base. Other operating expenses amounted to NOK 9.5 million in the quarter, which is down significantly both from Q4 and from Q1 2025 where they were at 12 and close to NOK 14 million. We had in total operating expenses of NOK 32.3 million adjusted for the impairment loss, that would be SEK 20 million. and the same numbers for Q4 were NOK 23 million and NOK 25 million. So we are lowering our cost base. If we then move to the next slide. our cash flow. We started the quarter at NOK 6 million in cash. And through the capital raise done through the rights issue and the following exercise of the first tranche of the warrants both in Q1. So in January and March, we raised in total NOK 101 million in net proceeds. However, at the same time, we also bridge shareholder loans of NOK 52 million and these, as you know, were secured in 2025 in order to bridge the company's operating expenses leading up to the completion of the rights issue in January. Further, we had R&D expenses amounting to NOK 55 million and other operating expenses, including salaries of 12. We further had a timing effect related to accounts payable, and we used approximately NOK 10 million to repay supply credits in the quarter. So this leads to the ending balance of [indiscernible] at the quarter end of NOK 26 million. As mentioned previously, we have had a couple of capital raises through Q1. There was strong support from our shareholders, both in the January rights issue and the following warrant exercise. The warrant exercise of the first areas of warrants had an exercise ratio of 83% and raised NOK 35.8 million in gross proceeds. We have current financing that secures us through Q3 2026. This does not take into account the next series of warrants that will be exercisable in the period between first and 12th of June. What I think is important to emphasize here, is that the exercise of these warrants are done at a discount versus the share price. So it's a good opportunity to contribute to the company, both in terms of funding, but also at favorable prices. In terms of capital deals and financing, these are in line with what has previously been communicated. And we do not see any changes to our expectations for the next 2 years. We are going from an R&D-driven organization to a more product development focused manufacturing and, of course, into clinical clients. So this will, of course, be interesting and to follow. And also this is where the spending will go in the period that is ahead of us. So with that, I will leave it to [indiscernible] to continue with the outlook and some of the portion.

Thank you very much, Petter. And with that financial review, I would like to conclude by briefly summarize where we stand following the first quarter and how we currently view the next phase of our development. Looking ahead, our immediate -- our immediate priorities are increasingly execution-focused. The main near-term focus areas are to advance on the regulatory process to prepare for clinical studies continued optimization, of course, of implant stability and system robust robustness and further strengthen the operational platform for scale-up and future commercialization. At the same time, we continue progressing the CE mark documentation for the complete CGM system and prepare towards a limited veterinary market launch. As discussed earlier, we are still reassessing elements of the broader regulatory and operational pathway, including the transition to Wood Bergen based manufacturing and operational integration. We therefore expect to provide a more updated and specific road map as this work progresses further. To summarize, Q1 represented an important transitional quarter for LifeCare. We have achieved reproducible in vivo system level of validation of the platform. We have confirmed continued implant stability under real-life conditions. We have simplified the regulatory pathway towards a single pivotal CE Mark study. And we have initiated the operational transition toward a more scalable and integrated manufacturing model. Taken together, these developments strengthen the foundation and future clinical progression, scalable production and the eventual market entry. At the same time, we remain disciplined and realistic regarding the remaining work ahead, particularly within regulatory execution, quality systems, and production readiness and financing. Overall, I believe that it's very fair to state that we believe that the platform and organization are materially stronger exiting the first quarter than entering it. With this, I thank you very much for your attention this morning. The full report and presentation are available for download on our website, and we will now be happy to take any questions. What I would like to do now is to go to the Q&A. I just need to find a section. Apologies for that. There is the Q&A section where I know that it's already uploaded some questions. And please feel free to increase the number of questions at all times.The first question is related to the pet market and partnering, I'm going to read it out. Could you elaborate on the commercial strategy for the pet market? And are you already in discussions with potential sales or distribution partners in Europe. I'm not in a position to give a comprehensive update on the neither the commercial strategy or kind of our positioning within towards the veterinary market. First of all, I think it's important to once again emphasize the fact that our veterinary market strategy is first and foremost designed to support the clinical development, the human development. However, we are in dialogue with several potential partners on the veterinary side. Whether we decide to go alone to market first to do the first initial launch or if we are positioned to get into a partnering deal at an early stage still remains to be seen and is pending, of course, the interactions that we have with potential partners. The next question is related to financing and strategic capital. And it is that you mentioned strategic capital as 1 possible financing source. Could this include an industrial or commercial partner? And is this something you are actively exploring on I would say that the question to the -- answer to the first part of the question is, yes. We -- of course, strategic capital could include an industrial or commercial partner. It could also include other elements. However, we are -- this part of, of course, strategy going forward, especially towards the pet market, but would also increasingly be part of the strategy going forward towards the human market. When it comes to the resubmission, the next question is related to reservation and regulatory time line. after the work with Link Medical and the updated regulatory strategy, when do you expect to clarify the time line for the pivotal CE Mark study and resubmission process? There are 2 elements that is directly impacting when we can provide an update on the time line here. The first is that we are currently in the middle of an ongoing kind of formalized reassessment of our regulatory strategy going forward. I mean we're working with Link Medical on that field, and we expect to receive the first draft and also to be able to conclude on that -- on the reassessment within weeks, hopefully, by end of May, but at least within mid-June. -- the next -- the second thing that impacts the time line going forward is when we are actually able to do the production ourselves. Up to date, we have done it on our own production line, but externally at a consultant in the U.K. And as we have explained, we are now moving this to Bergen. We expect to be able to do that to be up and running with that production within this summer. And we, as part of the regulatory strategy assessment. We will also, of course, take this into consideration and be able to provide a better and more specific time line on the path forward. And we hope to do that as quick as possible, but we plan to do that no later than the next quarterly report in August. The next question is when should we expect the start of launch activities in the vet market. Is this too optimistic to anticipate revenue already in -- is it too optimistic to anticipate revenue effect already in H2 2026. What is the go-to-market strategy? You have previously mentioned going to selected veterinarian clinic clinicians, how does this look like now? First of all, it is too optimistic to expect any revenue from the vet market in the second half of 2026. We have an alternative road towards the veteran market, which would include limited sales through dedicated veterinary clinics. That is, however, depending on our production capacities. So we still look forward to be able to say we are now going to the veterinary market. However, this is from a strategic perspective, first and foremost, supporting the human process going forward. and we [indiscernible] where we can be more specific on that time line either. Other than to state, as we have said previously, is not to be expected significant revenues from that on the short term. The next question is numerous questions. First one being, when you write in report successful validation in vivo, does that include numerical glucose accuracy? How should we interpret that statement? I think First of all, this is an ongoing study. And hence, I think that it's not fair to kind of create snips of that, that is conclusive and may be optimistic before we have the full picture of the study and can make firm conclusions. So until that, we are going to remain on the statement that we are seeing glucose relevant variations from the raw in [indiscernible], which is, from our perspective, a significant achievement. The reason for that is that as soon as we have a volume of data that is glucose and physiologically glucose relevant. It increases our progress towards actually being able to translate these numbers into numerical values. But we need to both spend the time wise and spend the data-wise so that we hit the spot on before we go ahead and confirm that publicly. The next question is, when will you provide more data and/or results of the longevity study? We have not been sharing any specific data from 1 and 1 [indiscernible], and we will also not do that. What we will do is that we will continue to inform about, I mean, the significant milestones in terms of durability in life under real-life conditions, et cetera. However, I ask you to -- unfortunately, I have to ask you to be a bit patient when it comes to the actual study outcome because this is part of the overall study. So we need to work on that, and we'll come back with the analysis when we close down the study assays. Next question is that the single CE clinical investigation. Any details on the detailed assessment and what would the approximate study design look like? To that, what I can say is that the study -- we already have outlined a study design for the CE study. That has been on our table and on the board table for close to a year. This has been pending and waiting for the first in-human study. So we have the sketch, we have the framework for the clinical study. However, as we now are in the middle of doing an overall assessment of our forward regulatory strategy, this also, of course, includes the clinical strategy. And we would be happy to share that when we have a final framework that we are ready to share with the notified body. And that leads me over to the next question, which is how much additional capital would be needed for that CE trial. You state that the warrants will provide runway through to start of trial, but not other details, if I'm not mistaken. Can you tell us more on the financial outlook. First of all, our assessment and direction in terms of the regulatory strategy is a cost reducing -- has a cost reducing effect. What we are doing effectively is that we have taken out the first in human study be based on the feedback and the advice that we have received from Link Medical and the prospective notified body. This leads to a cost reduction. We do not see that the -- our plans for the CE study, previous or current will lead to any increase of of capital [indiscernible]. What I think is also important to note here is the fact that while the Board at the Q4 report and also to quite some extent, at the annual report for 2025, expressed some concerns related to the going concern statement. The quarterly report for Q1 significantly reduces the wording from the Board, where the uncertainty related to the going concern is taken out. The reason for this is two-folded. First of all, as you will see on our capital base, we are -- have a strong increase. We have an improvement compared to the first -- to the last quarter of 2025. going out of the first quarter of 2026. The other part of this is the fact that we have done significant cost-reducing measures throughout 2026 to date, both related to the regulatory strategy and also related to the operational strategy. It is stated in the report that we envision from we envision soon a reduction of salary levels corresponding to 30% to 35% based on the winding down of Germany. In addition, as part of this winding down, we also have lease agreements that we are in process of exiting from. Hence, the overall cost reductions from this operational restructuring is significant. Obviously, to set up production in Bergen will impair some costs. However, the cost of this setup is significantly lower of what we would have to use anyway setting up this production in Germany. So all in all, I think that the financial outlook for the company even though we have funds that can appear limited. I would say that the financial outlook has materially improved since the last quarter. And we are looking forward to execute on our plans based on a cost model that is aligned with our available capital. And then the last question, as far as I can see to now is given the manufacturing transfer to Bergen, does the established reproducible manufacturing process need to be revalidated of the transfer. How much would that cost? And how long time can that take? Well, I briefly already touched upon that. But let's go a bit back and just establish the basic fact here. Our production or manufacturing processes are set up at the consultant in the U.K. The plan for LifeCare was to move that to our production capacities in Germany. However, from [indiscernible] a strategic reassessment, we decided to not do that. We decided to rather bring it to burden. And taking into account the cost reductions we are seeing due to the wind down of the German company and the cost and the increased costs in Bergen, we can say that the path we are following now is more cost efficient. So there will not be additional costs compared to what we have signaled earlier. When can we expect -- I mean, the question is how long time can it take? We expect to be operational to produce in Bergen in at least in the third quarter of 2026, 6, apologies, 2026, which would be the same time as we would be operational in Germany. Hence, there is no changes there. We are sending -- what can I say, we are sending a delegation to the U.K. within the next week to start the process of taking over. This will also include to actually do production of a new batch of implants. So all in all, I think that the strategic review we have done is definitely moving us forward towards a more efficient, both operational and financial way going forward. Next question is related to the pet market. Can the numbers sent from the implant be read on a smartphone? Or is it currently displayed on another device? Short answer, it can be read on a smartphone. And then there is a question with the VIVA period for warrants 2 starting soon. Can investors expect any operational or regulatory updates in the next 2 weeks? It's a tricky question. Obviously, we are aware of the fact that we have a VIVA period coming up. However, we are not positioned to to influence on the operational or regulatory updates related to when the VIVA period actually occurs. So this is pending the feedback and the work we are doing with Link Medical at the time. And of course, also on the progress we are doing on moving the operations to Bergen. What I can say from a general perspective is, of course, that we will provide updates as soon as we are ready to do so when we have the full picture, the full information and are able to provide solid updates. What I can share with you is -- and I'm obviously going to be a bit careful on sharing our plans for communication going forward. However, we are progressing on the strategic reviews, and we hope to be able to disclose a more comprehensive overview on that field within not too long, but unfortunately, we have to ensure that this is done in due time and the right order. So we will come back with that as soon as we can, and we will then, of course, update the market as a whole accordingly. To my understanding, we have no more questions. That indicates that we are done with this quarterly report. Once again, I want to thank you for participating this morning. Thank you for your questions, and thank you for your interest in LifeCare. Looking forward to see you at the next quarterly report with a more comprehensive update on our ongoing forward pathway. Thank you for your attention, and I wish you all a there coming -- there was a new question. Sorry about that. Let's just take that before we close it. Is the app for smartphones developed by a third party? Answer is yes. It is developed by a third party. With that, I thank you for your attention. Wish you all a great weekend when it comes. And of course, a great national day for all Norwegians, participating. Have a good day. Thank you.