Microba Life Sciences Limited ($MAP)

Okay. I'm very pleased to share an update on our progress following close of the quarter ended 31 March, 2026. Now if you have any questions, please use the question submission feature and I'll address as many as I can live in this session. Then any that I can't get to, I will answer after in the Investor Hub platform. Now moving past the standard disclaimers. Closing Q3 FY '26, we are continuing to execute on plan and tracking to our target and guidance. So that's expanding clinical adoption in Australia and the United Kingdom, moving up the customer adoption curve, delivering strong growth for our core testing products and tracking to regional breakeven for Australia and the United Kingdom, all on path to breakeven for the whole company. So let's start by breaking down the strong top line numbers from the quarter. The headline number is core testing revenue up 99% year-on-year. Underlying core testing volumes up 58% year-on-year, now at a quarterly annualized run rate of over 23,000 tests, all remaining on track, as I said before, for our regional breakeven guidance, for core test volumes targeting over 24,000 for the financial year. And Q4, by far, is always our biggest growth quarter every financial year. As always, there were a range of milestones and highlights from the quarter that build up to that. So let's jump into them. And as I highlighted last quarter, Microba is creating an entirely new diagnostic category in clinical microbiome testing, which we estimate represents a market worth over $100 billion. We have shared in depth that category creation here requires disciplined execution aligned to the customer adoption curve, progressing from innovators to early adopters and over time, to broader mainstream adoption in the early and late majority. And we're executing a structured region-by-region market development process that has distinct stages. So last quarter, if you recall, and if you didn't catch it, go back and have a look, had a table that shows our progress in each market and our development across each of our regions. I particularly called out for Australia that we have advanced from the Innovator segment into the Early Adopter segment. And that includes a new type of customer with these enterprise style contracts with health care groups and that we're making good progress in signing on these key clinic accounts. So in this quarter, we've continued to mature and execute that pipeline of enterprise style contracts with these health care clinics. And these accounts when signed and activated really represent meaningful reoccurring volume potential. And so I really wanted to provide some texture to that in this quarter. The team now have over 130 key account targets in the pipeline across Australia. And taken together, they have an estimated ordering potential of over 60,000 tests per year. So since we commenced targeting these key accounts in November, we've already signed 27 of them in Australia. And they alone represent a total estimated ordering potential of over 19,500 tests per year. As at the end of March, those 27 key accounts that we've already signed in Australia, already sold 2,874 tests. And we're seeing the volumes from those accounts growing strongly month-on-month. So to exemplify that, if you take March sales from these accounts and you annualize them, that's over 7,400 tests. That shows the significant growth opportunity ahead from these key accounts that we've already signed and onboarded, but then there's a strong pipeline that the team are rapidly signing behind it. Focusing on the U.K. for a moment. Like I did last quarter, I wanted to zoom in on our progress in our staged market development of that region, leveraging our acquired customer base there in the U.K. So what I've done on these charts is compare Microbiome Explorer comprehensive volume since launch in Australia against the same time since launch in the U.K. And the 2 key take homes from this slide are exactly the same as last quarter. First, that the quarterly trend is the same. The products were launched at the same time of year, so the seasons line up, and we're seeing the same trend in market adoption aligned to holiday periods. The second is that we are seeing U.K. adoption outperform Australia adoption at the equivalent time post launch. And this is what we expected to see leveraging the existing acquired customer base in the U.K. So really good progress in the U.K. Next, our product feature releases. So I continue to communicate that there is an intimate linkage between product advancement, the adoption curve that I've been talking about, and our growth strategy. Aligned to that, we will continue to update the market on our product advancements and new feature releases, and there are some really important ones here. So the first is that we have a major new test targeted for release at the beginning of the new financial year. This product is the culmination of several years of leadership at the forefront of this new diagnostic category. It represents a meaningful leap forward, I would say, in the clinical application of complete microbiome and gut testing. And this new product is expected to open up our serviceable addressable market to a core group of medical doctors, which represents a significant next segment of that adoption curve and a significant next segment of health care professionals in the market for our test. This product is already live with a beta cohort of 25 clinicians across the United Kingdom and Australia and already receiving very, very positive feedback. So I really look forward to showcasing this product to you when we fully release it. It's going to really solidify our market leadership in this category, and I expect will meaningfully contribute to the continued acceleration of our growth. The second one is the next version of our Sampling Kit, which was released in February. We see that companies in pathology testing often really overlook the patient sampling experience. Not only is this critical for delivering a sample that is fit for laboratory analysis and for the delivery of an accurate result, but the sampling experience is one of the most powerful word-of-mouth adoption drivers. So the dinner party conversation that we want to stimulate is, "The Sampling Kit came in the next day, and it was really easy. You should definitely go get tested." So version 1.5 of the Sampling Kit further delivers on this with a better customer experience, and it will continue to get better and better through time. And we also delivered a meaningful improvement to cost of goods. So that's an additional win. The last one here is our clinical integration platform. So in conjunction with our new product release, to continue accelerating adoption and opening up our serviceable addressable market, we want to further make our test seamless to refer, order and purchase. And we're doing this through our clinical integration platform, which is targeted for release in this quarter. And this platform embeds our tests into the clinical systems that general practitioners and specialists already use every day. So what that means is that they can order, receive results and act on them without leaving their existing practice management software and workflows. Aligned to that, in March, we executed a commercial partnership agreement with Best Practice. So Best Practice is the dominant general practitioner practice management software in Australia. used by over 28,000 GPs and is truly the software of choice for every early adopter GP that we've interviewed. This integration will enable ordering of Microba's products directly on the drop-down list that they utilize every day for pathology test referrals. And important to highlight, Best Practice is just the first partner on Microba's clinical integration platform because naturally, they are the largest in Australia. But then we have additional partner integrations planned for quarters ahead. So that's all of the updates on products. A lot of good stuff coming through the pipeline. Now let's break down the strong sales results for the quarter. It was another record quarter for Microbiome Explorer in Australia. We saw continued strong growth, Q3 sales of 4,786 tests, which was up 58% year-on-year, amounting now to an annualized run rate of circa 20,000 tests. Ordering clinicians for the quarter, 824. And consistent with past quarters, I've shown the chart here half-on-half with the loading bar for where we are in Q3, partway through half 2 because it shows the continued consistent stepping up in volumes without any seasonal impacts. And it also shows that we are getting higher volumes per clinician as we move up the adoption curve. In the United Kingdom, as I said before, we're making really good progress and higher than the equivalent time post launch in Australia, leveraging our acquired U.K. team and customer base. Q3 sales of 816, annualized run rate circa 3,000 tests, ordering clinicians continuing to grow, 266 for the quarter, continuing to trend up nicely with good growth in adoption. Next, MetaPanel. MetaPanel adoption remained steady in Australia. As I've continued to state for multiple quarters, this is not a growth focus for us right now. We remain in an early market development phase for this test, focused on the organic development of gastroenterology specialists and key clinical studies. And aligned to that, we have one of our key clinical studies published in Frontiers of Cellular & Infection Microbiology. And what that showed is that the clinical performance of MetaPanel reported 99% specificity and 91% sensitivity across 176 clinical targets, demonstrating the clinical performance and value of that test. So [indiscernible] apologies. We continue to expect a gradual rate of adoption for the next period. And it's really in FY '27 where we see the opportunity for larger volume through the maturing of our key opinion leader relationships, those gastroenterologists and our further publications creating the base for us to then translate that into broader adoption and routine referral behavior. Next to our U.K. Nutritional Supplements business. So here, we've continued to accelerate the transition to a greater focus on our high-margin Invivo branded and owned supplements and the ramping down of our third-party distributed Designs For Health branded products. This delivered a solid quarter for our Invivo supplements and underpinning this was a continued focus on our evidence-based PHGG prebiotic fibre supplement, delivering really strong growth, with volume reaching over 12,000 units and representing over 160% year-on-year growth. In addition to that, the subscription offering that we launched in October has now already grown to over 800 subscribers and continues to grow week-on-week. So key message is we're making good progress here, and we're really excited about the growth ahead for this part of the business. Now for an important update on our Therapeutics. So from our data and years of research and development, we have developed a rich pipeline of therapeutic assets and matured that business to have a near Phase II-ready lead therapeutic asset in MAP-315, targeting patients suffering from inflammatory bowel disease. Now the microbiome therapeutic and more specifically, the live biotherapeutic modality, has been maturing in its development. So big pharma have been awaiting definitive Phase Ib/IIa efficacy data that will validate that this new live biotherapeutic modality in a major chronic disease setting will deliver efficacy and support further investments in licensing and acquiring of these assets into their portfolios. Aligned to that, we've been guiding for a number of quarters now on clinical trial readouts that will provide that modality validating data for partners and stimulate that investment and deal activity for microbiome therapeutic assets, including Microba's best-in-class assets that are already in position for this activity. There have been multiple validating results since November. I updated on a range of them last quarter, but I want to go over them again, and I want to add to that. So there's another one that came out in February, and it's really important. So Siolta in November delivered a successful Phase Ib in pediatric allergic disease. a significant result for the sector. That was the first. Then followed by Maat Pharma in December, delivered a major Phase III result in gastrointestinal acute GvHD, graft versus host disease. And that's now under regulatory review with the EMA for market approval with expected decision somewhere in the middle of this year. And this is a major advancement forward and stands to be the first market approval for a microbiome therapeutic in a chronic disease setting. The next was then Enterobiotix in January, delivered a positive Phase IIa result in irritable bowel syndrome patients. But finally, and the new information, Microbiotica in February delivered a positive Phase Ib result for the MB310 candidate in ulcerative colitis patients. This is particularly relevant for supporting the value of Microba's lead asset, MAP-315, which is targeting mild-to-moderate ulcerative colitis. So it directly shows that a live microbiome therapeutic can deliver efficacy in ulcerative colitis patients. So this is all very, very good news for MAP-315, the value of that specific asset and the value of Microba's therapeutic platform and pipeline. And we've continued to see these results change the temperature of partnering and investment discussions. So as I've shared for a number of quarters, we've been very active in our partnering activities. But what I can say is that we've further intensified our partnering work here, leveraging all of this validating sector momentum. So obviously, a transaction here would be expected to have a material impact on the valuation of Microba. So to close out, what is our focus and upcoming catalysts. In Diagnostics, we're focused on continued growth in test sales and clinical adoption across Australia and the United Kingdom, release of our new test, release of our clinical integration platform and integrations into multiple practice management systems utilized by doctors. In Therapeutics, intensive partnering off the back of those recent positive sector trial readouts. And we expect continued sector catalysts over the balance of this calendar year. And then aligned to our FY '26 guidance, we will advance towards those regional breakeven milestones in Australia and the U.K., supported by 100% year-on-year growth in core test volume targeting over 24,000 tests for the full financial year. So that closes the quarterly update. And I'll now -- as always, I'll go to some of the submitted questions that have come through. And the ones, as I said at the start that I don't get to live, I'll ensure that I answer after on the Investor Hub platform. Now for anyone new to Microba, I typically do a recap of the business after addressing questions. But because I've done it so many times now, I would just encourage, if you're new, go and watch one of the webinars from recent quarters, and you'll get that full history if you go about halfway through and watch the full run through. If you can't find it, please let us know, and we'll direct you to the right link.

Okay. So let's go to questions. So the first one here on the screen is, you've described the pipeline and progress of enterprise style contracts for these key clinic accounts. Who are these clinic accounts? And how should we think about those large volume potential numbers given that you're at a run rate of 23,000 tests, but they alone have an ordering potential of over 60,000? So to answer this, I just want to recap on what I said before. And actually, I'll go back to that slide because I think it's really useful. So again, Microba is creating a major new diagnostic category here in clinical microbiome testing. I would say, and I've described this before, this is akin to what happened with prenatal genetic testing, NIPT testing, and cancer genomic diagnostics. These were major new diagnostic categories that a handful of companies created and are now significant markets. And we estimate that the total clinical microbiome testing market when developed, is likely to exceed USD 100 billion. As I've shared, category creation here requires this disciplined execution aligned to the customer adoption curve, progressing from innovators to early adopters and over time to that broader mainstream adoption. This is a structured region-by-region market development process. And in Australia, that adoption has moved beyond innovators and now into early adopters, which is increasingly characterized by these enterprise style contracts with health care clinics. And these accounts when signed and activated represent this meaningful reoccurring volume potential. So that just repeats what I said before, so we're all on the same page. Now who are these accounts? These accounts vary from single physical clinics that have multiple clinicians underneath and fit with the target patient population that we're serving with our tests. But there's also larger enterprises that have multiple clinics and clinicians underneath. So that gives you a bit of a flavor of what we're talking about with those enterprise clinic accounts. And as I shared before, for this early adopter phase of the adoption curve, we now have this target pipeline of over 130 key account targets. These are not just leads. Many of these are fully engaged and progressing to contracting. So in total, we've said that they have an estimated ordering potential of over 60,000 tests. We will come through that through time in contracting and activating and onboarding these accounts. But since we commenced targeting these key accounts in November aligned to our advancement of our product features, that enable us to open up those accounts. We've already signed 27, representing a total estimated ordering potential of over 19,500 tests per annum once we've fully matured those accounts. Having signed them in November, as of the end of -- having started signing them, sorry, I should say, from November, but we're increasing our progression of signing. At the end of March, those 27 key accounts have already sold over 2,800 tests, growing strongly month-on-month. But if you take that March number, you annualize it, we get over 7,400 tests, which is yet to be fully realized. So to the second part of your question and just higher ball around it, how should we think about those large volume potential numbers? We started signing these accounts in November. We have a target list of over 130, already signed 27. Since then, those 27 have already contributed over 2,800 tests. March numbers annualized show how quick those accounts are growing. So on an annual run rate that -- they're at over 7,400. That growth isn't reflected in the volume numbers today, but it will be in the quarters ahead. And the full volume potential of those accounts alone is over 19,500 tests per year. So that's what you see on that chart. But then we're signing new accounts every week from that broader 130 target list. And so the total opportunity from that list, and this is just for this phase of the adoption curve in this early adopter group, is over 60,000 tests per year. So the key message and how you should be thinking about it is there is significant growth opportunity being unlocked here. So the next is in the quarterly, there was a statement regarding confidential negotiations regarding a corporate transaction. Can you please provide some more information? Unfortunately, I can't say more at this time. But for those that haven't seen it on the quarterly itself, I will just give you the statement verbatim from the quarterly release. It is -- the company is in confidential negotiations regarding a significant corporate transaction that, if completed, would improve the company's financial position. The transaction remains incomplete, subject to a number of conditions and should any transaction proceed, we include shareholder approval. The company will make a further announcement to the market regarding this transaction should binding provisions be agreed. Moving on to the next question. The 4C indicates just over 2 quarters of cash. What is management and the Board doing to address that? What I would say is we have clearly guided as much as possible in the prior statement. We have an incredible company that is growing strongly. So I will repeat what I said last quarterly. Growth is accelerating. Sales and contribution margin are going up. Costs are coming down. The market has heated up for microbiome therapeutic assets with opportunities active. And there are multiple other nondilutive funding opportunities which can significantly impact the cash position and continue to grow and unlock shareholder value. All right. On to the next one here. So the next one here is, the microbiome therapeutic sector -- sorry, the microbiome therapeutic sector readouts continue to be very positive for Microba's assets. The recent readout from Microbiotica is very exciting. How should we think about that result for MAP-315? And is that competitive with Microba's MAP-315 asset? Yes, good question. So this is a huge result. Microbiome therapeutics is really heating up, and Microba is in a prime position here. So what big pharma have been waiting for, as I said before, is to know that these live microbiome therapeutics can work in a chronic disease. Prior to February -- sorry, I should say, prior to November when that cascade of results has come out, the only real efficacy data in humans for microbiome therapeutics was in infectious disease. And now with the series of readouts, that question is [indiscernible], these live microbiome drugs improve outcomes in multiple chronic diseases. But even more specifically, the Microbiotica result showed that they can specifically improve outcomes in inflammatory bowel disease and even more specifically in ulcerative colitis, which is what we are also targeting with MAP-315. So this immediately makes MAP-315, I would say, significantly more valuable. Now to the question of whether Microbiotica's MB310 asset is competitive with Microba's MAP-315 asset. I would say, yes and no. The yes is we're both targeting the same patient population. But it is a very big market, and there will be multiple players. We have a number of advantages with MAP-315. Single strain, so simpler manufacturing, regulatory and elucidation of mechanism of action, no antibiotic pretreatment of patients. We have a biomarker, which enables precision trial and potentially in the future precision prescribing. The list goes on. The Microbiotica complex consortia asset with multiple different live organisms has none of those advantages. But I'm actually going to go to a slide here because -- I think I've still got this at the back in my normal presentation deck. Yes. I've talked about this for a while, but it's worth touching on the comparables here on the left. So I've said for quite a while that this set of transactions that is on the left table here, that played out for a new set of drugs, TL1A therapies, is a really good parallel to what I expect here in microbiome therapeutics in inflammatory bowel disease. So why is that? So if you look down at the bottom there, what happened was Prometheus delivered a really compelling Phase IIa result. And off of the back of that, that really validated that these TL1A drugs can have an impact in inflammatory bowel disease treatment. And there was an intense bidding war for that asset. Merck won. They paid handsomely, $10.8 billion. But then there were a bunch that missed out on that. And this is a major patient population that all of these major pharma companies want to have a play in. And so they went rapidly after finding their asset that could reasonably compete in this class. And I think the same thing will happen here. There will be an initial deal done. And then there will be a whole bunch that miss out. And it's going to be a really competitive space with room for multiple different therapies. IBD is a really heterogeneous patient population. There's a lot to solve that is unaddressed by the current standard of care. So I hope that answers the question. The last one here, actually, there's a couple of questions here, which I'm just going to amalgamate [indiscernible]. My apologies if I don't get this right. I will go back through the Investor Hub and make sure I nail the specifics of each questions. But there is a bunch of questions here about the impact of AI, not like I spoke about it last time around operations and how it's driving efficiency, but about what it means for the value of Microba's databank and what happens in the world of foundational models and where do we sit? So this has actually been a very live and topical conversation at Microba. I would say that everything that's happening in AI right now, particularly in health care and in drug development, has significantly increased the value of Microba's databank asset. And let me explain why. I was invited just last month to speak on the topic of AI in health care alongside one of the original Google DeepMind team, that was a part of the AlphaFold group that won the Nobel Prize. Now why would I be talking at that event at Google in Sydney? Well, we've seen what happens when you take large, high-quality biological data sets and apply Sirius AI. The results in genomics, in protein science, in drug discovery, have been transformative and are going to continue to accelerate. But those breakthroughs and all of the work currently have been built predominantly on deep data for human cells. We have almost nothing equivalent for the microbial communities that interact with every one of those cells in human systems. So biologically, looking at all the cells in and on our body, we are -- and I've said this many times before, we are more microbial than we are human. And so you have Google, Anthropic, Isomorphic and other hyperscalers after the pursuit of solving all of human health and disease. But they all have a massive blind spot, the microbiome. All of the foundational models being built are completely missing the microbiome. And it's not because they don't think it's important. We have these conversations specifically with them. It's because the high-quality training data doesn't exist in the public domain. It's not about data quantity, it's about actually data quality. So to build a foundation model for the microbiome or including the microbiome, you need clinical grade, comprehensive or complete multi-kingdom microbiome data linked to patient health data generated under standard regulated protocols at scale. And I would say that we are one of the only and potentially the only company in the world that has that. So what a microbiome foundational model could unlock is profound. It's like predicting how patients and microbial community will process a drug before you administer it, because the microbiome, if it's an oral drug, will change how that drug is actually shaped and formed and change its efficacy. Even with a IV drug, the microbiome changes and modulates the immune system, which may change the way that you respond to that drug. We can stratify clinical trial populations by microbiome state. We can identify therapy responders. We've already done a mountain of work on that. We have some very, very compelling tool set for identifying response to therapy. And we can computationally design new therapies, new interventions targeted at specific disease states. We've built a whole therapeutic platform around that. None of that is possible for these hyperscalers without the data layer. And that data layer is what we've been building for years through our clinical diagnostic engine that scales with every patient that we help and consents for that data to be used for R&D. So the leading AI labs have extraordinary compute and modeling capability. We have the clinical grade data set. The opportunity is to bring them together with the right expertise in compute. So think about how important that is and how much that could be worth. So safe to say, we're very active in pursuing that. We are really excited about what we can do with our data in that world of AI-driven health care and drug development. So I'm going to close the quarterly there. I can see there's a bunch of additional questions. I will get to them on the Investor Hub. I'll close by saying, as I always do, I am incredibly excited about the opportunity impact and growth ahead for Microba. We are genuinely at a real inflection point of operational focus, advancement up the customer adoption curve, major product advancement, major evidence generation, AI efficiency and a major maturing of the opportunity for our Therapeutics division and our assets there. We have a world-class team, best-in-class technology, category-defining products, and we're about to release a new one. For patients, we are already changing lives, and there are a lot of people that need our help genuinely. As I've said before, Microba represents a category-defining company with what I'd say just for an imperfect analogy, the medical device side of a [ Cochlear ], but with the medical software and scaling opportunity of a Pro Medicus. We have decades of growth to unlock here. And so it's a really incredible time to be a Microba shareholder. Thank you all genuinely for tuning in to the update. And to all our shareholders, a big thank you from me, the executive team and the Board for your ongoing support. Thanks, everyone. We'll close then.