Good afternoon, welcome to the Shield Therapeutics plc final results investor presentation. Throughout this recorded presentation, investors will be in listen-only mode. Questions are encouraged and can be submitted at any time by the Q&A tab situated in the right-hand corner of your screen. Simply type in your questions and press Send. The company may not be in a position to answer every question it receives during the meeting itself. The company will review all questions submitted today and publish responses where it is appropriate to do so. Before we begin, I'd like to submit the following poll. I'd now like to hand you over to Greg Madison, CEO. Good afternoon to you, sir.
Great. Thank you everybody for joining us today. We're very happy to discuss our 2022 financial results and first quarter 2023 update. Joining me in the call today is my Chief Financial Officer, Hans-Peter Rudolf. We will be going through our presentation, and then we'll be responding to some questions that are submitted on the platform here at the end of the discussion. Let's kind of pop right into it, if you will. We will be making forward-looking statements, so please go back and review all of our financials and disclosures carefully as we go through the presentation.
Look, we are really, really happy with where we're at, as of right now, as there's been a lot of work that's had to have been done here, particularly in the first, you know, several months of 2023. We're very pleased to kind of provide you with some updates here and some context on where things stand right now. Obviously as we kinda close the final chapter in 2022, and we'll get to that in just a minute, and then shift our attention here to 2023. Some quick highlights that we were able to achieve, you know, nice rapid growth in prescriptions last year, achieving over 25,000 prescriptions of ACCRUFeR here in the US, which is up twelvefold year-over-year.
We started the year in 2023 with a strong 12% sequential increase in growth off of that Q4 platform. Very impressive, particularly when you think about some of the behind the scenes things going on here as we kind of expand our commercial operation and look to hire a whole bunch of people, which we've done a really nice job of. Speaking of that, of that process here, we signed the Viatris agreement as a collaborative sales agreement at the end of December last year. We have made tremendous progress with that partnership overall. I'm gonna be happy to talk about our goal that we had of getting to 100 people out there in the field by early May, and we're very much on track to achieve that goal.
Obviously the end of last year, we raised funds to support our operations to cash flow part break even by the year-end 2024. Down below you see some of the milestones that we have line of sight that we are setting our eyes on for the next couple of years. Before we get into a lot of the forward-looking kind of 2023 performance, you know, as noted earlier, I think, this is our opportunity to kind of put a final closure for 2022 with our updates we provided today. With that, Hans-Peter, let me turn it over to you for the next couple of slides to walk everybody through what we announced today related to 2022.
Yes. Thank you, Greg, and good afternoon, everyone. In terms of financial highlights, I'd like to focus on three areas. First and foremost, revenues, reported GBP 4.5 million, about USD 5.4 million in total revenues for 2022. That is comprised of net product revenue from ACCRUFeR sales of GBP 2.9 million, royalty revenue from product sales in Europe by our partner, Norgine, of GBP 1.4 million, and an upfront payment of GBP 0.2 million from KYE Pharmaceuticals on the signing of the license agreement with this partner in Canada in the early part of 2022. Important that in this number we have not included total revenue from the upfront payment received from Viatris upon execution of the co-promote arrangement. That payment of GBP 4.2 million was received in December.
Unlike normal traditional license agreements, we needed to record that differently, and we effectively needed to align the recognition of that in line with the spend that we have to undertake to prepare the commercial operations for the co-promote partnership. In the 2022 income statement, you'll find GBP 0.7 million in other income, which is a portion, a small portion of that upfront. The balance of GBP 3.5 million will be recognized in 2023, when we actually will expend the related costs. Operating loss before impairment and research and development expenditures amounted to GBP 24.6 million. That is roughly GBP 5 million more than in the last year. That increase is primarily attributable to additional selling costs in the U.S. as we now had a full year of U.S. commercial operations.
In 2021 in comparison, as you recall, we only launched a product effective July, and as a result, we had only had a half year of effective selling activities. Cash and cash equivalents amounted to GBP 2.8 million at December 31, 2022. However, that amount does not yet include the net proceeds from the equity fundraise, which we collected in the very early part of January. That amounted to GBP 16.2 million, as well as the drawdown on the second tranche, after the amendment of the shareholder loan, the convertible shareholder loan, which added another GBP 8.2 million and was also added in January 2023. At the end of March 31, 2023, we had cash on hand of just under GBP 20 million. Greg. Yes.
Here, a recap. I think this is important that we could show you all that what we have effectively done and completed in terms of funding transactions over the last six to eight months. It's been four separate transactions that have contributed to the cash balance that we have on hand right now. In August, very early August of 2022, we executed the initial tranche of the convertible shareholder loan with AOP Health International Management. That yielded net proceeds of GBP 8 million. In December, as previously mentioned, we collected the upfront payment from the Viatris co-promote partnership of GBP 4.2 million.
In January, we follow through with the net proceeds from the equity placing and open offer, as well as the amendments, the second tranche of the convertible shareholder loan of GBP 16.2 million and GBP 8.2 million respectively. In total, over a six months period, we were able to raise additional funds in a very, very difficult environment of GBP 36.6 million or nearly $45 million. That results in the cash on hand balance that I just introduced before, just under GBP 20 million. Perhaps importantly as well, after a couple of conversions, of partial conversions of the shareholder loan by AOP, we have a debt balance of GBP 12.4 million as of the end of March. That's $50 million. We only pay interest on about one-third of that for 2023.
As you may recall from the announcement that we made at the time when we signed the amendment to the loan agreement, the second tranche of GBP 10 million is got an interest holiday for all of 2023. Thank you.
Thanks, Peter. Great. Let's go into what we are excited about here. I think honestly, as we think about where we are not only ending 2022, but as we enter 2023, I think ourselves and our new partner, Viatris, we share the same viewpoint of where we can take this product overall. That's one of the reasons both companies have come together. We've talked about this, you know, large defined market, what we believe that we have in an FDA-approved potential best-in-class solution. You will see over and over again this unmet need is real out there. We've got the commercial partnership agreement that we'll talk about in detail.
In addition, we've made some nice additions to our team here as a senior leadership team. We've got a very, very experienced team here that knows how to launch brands and build drugs. We got a strong reimbursement base on which to be able to build here as well. One of the things that we share the common view at is this market being very, very ripe for what we call innovative disruption. You have this very large market of 20 million patients out there suffering from anemia. You've got 13 million prescriptions written every single year for OTC iron, creating a market opportunity of $2.3 billion. We know where these prescriptions are written. 80% are written by women's health and general practitioners, which is exactly where we've kind of concentrated our selling efforts.
You've got this incredibly unsatisfied market driven by GI-related adverse events and minimal efficacy. Over and over and over again, you will hear from physicians and patients alike that, you know, this tolerability, these GI-related adverse events comes front and center when they're treated with these OTC irons. The challenge here is that there's been little to no innovation in the oral iron therapies in the past decade. What this creates is a bit of a dormant market, right? This market has been operating the same way for the past 5-10 years, meaning that physicians see a patient with iron deficiency, whether without anemia, they write an OTC iron as that first prescription. They don't expect it's gonna work, but they'll hope it will work and be effective and be tolerated.
Generally speaking, patients are gonna cycle over and over again back to these therapies. We need to wake this market up. This is a very, very dormant market. We believe we have a best-in-class type of solution, but if they don't know about it, they can't change their behavior, that's collectively the work that all of us are out there trying to do. Importantly, from a basic standpoint, iron deficiency, it is actively treated by physicians. There is no question this is not an issue where we need to educate them on the need to treat. It is very well established that iron deficiency and iron deficiency anemia is a source of morbidity and mortality. When physicians see these patients, they do actively treat.
On the right-hand side, the challenge that noted is you just get into this unsatisfactory cycle of switches and discontinuations from the patient perspective. It frustrates patients, and it frustrates physicians to be perfectly candid out there as well. We've developed our product to deliver both effectiveness and tolerability, right? We get a proprietary formulation with our maltol complex as compared to traditional oral irons, which are mostly these ferrous-based irons overall. What this allows us to do, as you see on the right-hand side, this maltol complex basically acts like a shield. It enables the iron to pass through the stomach, get down to the duodenum where the iron is absorbed. We use a very low dose of iron because it's delivered directly to the site where the body is gonna absorb that iron.
That contrasts significantly what you see with ferrous-based irons, which dissociate as soon as it hits the stomach. That free iron that's now circulating the gut leads to a lot of those discontinuation rates and a lot of those GI-related adverse events. you know, our molecule that we designed was very, very specific here. When we get a chance to talk to physicians about this particular aspect of what their experience is like with traditional irons, you know, what our product is like, what our MOA is like, how we designed it to be different, and then backing it up with our clinical trials as shown here, you know, the reaction is quite positive. the challenge is we've got to get out there to more physicians, which again is what we're gonna talk about just a minute.
Our product is very elegant, very simple overall how we designed it. The results of the trials, there were 3 Phase 3 trials that showed across the board significant increases in hemoglobin to treat the iron deficiency, but doing it in a way that's well-tolerated with a less than 5% average reaction and discontinuation rate. For us at Shield, we've got a great leadership team here and a great commercial team that is highly experienced. I would draw attention to Andy Hurley, who's in the middle of that box here as well. We just hired Andy as our Chief Commercial Officer. We announced it just a couple of weeks ago. He is off to a very good start. Andy stands out here.
He has extensive commercialization experience across a number of different roles throughout his career as he's built up his experience, both from a leadership perspective, but understands how to execute and drive drug launches. He is off to an excellent start. He's already done his first day in the field with one of our reps. He's down in Pittsburgh this week with the rest of the training class, getting to know them as well, and I think he's gonna be a great addition to our team here as well. Let's kind of move forward into 2023 and talk about our partnership mission, you know, between us and Viatris. Obviously, I think our universal goal here is to make ACCRUFeR the oral line of choice in the U.S. market, and I think we have the opportunity to do that.
As a reminder on some of the details of that agreement that we signed at the end of December last year, there was an upfront payment of $5 million on signing. The start date of this agreement was just a short 4 months ago, January 1 was the official start of this overall agreement. This is a revenue and cost-sharing model. We share net revenues and marketing costs, with Shield taking a slightly higher share. Collectively, the biggest focus here is building up that 100-person sales force, we'll talk about that in some detail. Each company pays for its own sales force, related selling costs, we have certainly sales milestones that are out there as well.
One of the things that attracted us to Viatris, in addition to our universal view of the market and the potential here, is just the commercial depth and breadth that they think that they bring to the table that can, we believe, can help accelerate ACCRUFeR and drive us to what we believe this can get to across the board. They've got a well-established commercial infrastructure and relationships. They are, just like us, hiring a dedicated 50-person sales team that's promoting only ACCRUFeR. They bring to the table best-in-class digital marketing, as well as direct-to-patient capabilities. You're already gonna see that the marketing teams, while they've been focused on expanding the field force right now, the marketing teams are already off and running.
We're launching a brand-new brand campaign here next month, those teams have already been working very hard, and they've produced some really, really nice things that we're gonna be able to talk about. Last but certainly not least, is they've got a very large experienced market access team with extensive relationships, and we think there's significant opportunity here, especially in the back half of this year, as we continue to drive that forward. One of the things that we have been communicating throughout last year is how do we drive and accelerate ACCRUFeR growth, right? There are three key areas we're gonna talk about. One is the field force expansion. The second was amplifying up our digital strategy, our marketing initiatives. The third was expanding our market access and distribution.
In many ways, our partnership with Viatris checks a lot of these boxes, which is why we executed that as well, but let's give you a little bit more detail on just where we stand right now. First and foremost, the field force expansion, right? On the left-hand side here, you saw where Shield had launched initially with our contract sales force and the coverage we had from a geographic perspective. This new 100-person combined sales force you see on the right-hand side, it's very obvious we get a lot more reach and a lot more efficiency out of this, right? Of the 100 people that we have out there, they're gonna collectively be calling on over 12,000 high-prescribing healthcare professionals.
Not only are we covering a lot more geography and reaching a lot more physicians, the sales team's territories are much, much smaller, which drives that efficiency, right? One of the things you'll hear me say a lot is this is a very promotionally sensitive product, right? The more physicians hear about it, the more often they hear about it, the different ways that they hear about it, drives that adoption on a faster perspective. Obviously, we're gonna have a much bigger reach and efficiency and frequency from our expanded field force with their targeted physicians, which is a huge bonus. I'm gonna spend a couple of minutes on this slide because I think this is critically important here.
As we kicked off the new year, the sales force expansion, growing the team to 100 collectively, 50 from Shield, 50 from Viatris, that is in many ways was priority A, B, and C, right. This had to happen. We wanted to make sure that we had a line of sight. We communicated that our goal collectively was to have all those people out in the field speaking to physicians and trained by May. I'm pleased to say we are very much on track to achieve that goal. In many ways, this can be incredibly disruptive to a lot of organizations, right. You know, when you think about we're gonna go through where we were in December, we had to basically tear up all those territory maps. All new maps, all new territories.
You got to get out there and recruit, hire, and train a whole bunch of people in a very, very short period of time, right? Meanwhile, you got to keep growing your business, right? For us at Shield, we're not a huge team. We're a very lean team overall. The same people that are out there trying to coach our reps are the same people that have to undertake, you know, this entire operation, and I couldn't be more pleased with where we ended up overall. Let's go through this in a little bit of detail. As a reminder, in the fourth quarter of 2022, for Shield, we had an average of 25 contract sales reps out in the field talking to physicians.
The first thing we did is once we announced the deal, we took a look at those 25 contract sales reps. We interviewed each and every one of them. We hired 16 of that 25, right? Those were now direct Shield employees, right? We've moved away from the contract sales model. These are now direct Shield employees. We had 16 reps promoting ACCRUFeR in the field during the month of January. That is the lowest number of reps we had in any month since launch, right? We hired the right people there. At the end of January, we trained the first 14 Viatris reps, right? Got them trained, they went out in the field February 1st. As we get into the month of February, you now have the 16 Shield reps, the 14 Viatris reps.
In essence, 30 reps collectively promoting to their physicians for the month of February and March. April 1st, we had the next wave that were trained that came through. That number collectively jumped from 30 to 66 combined. In May, we have a training class that's going on as we speak. In May, that number will jump from 66 to 98. Still 2 vacant territories to finish off, but we'll have 98 sales reps out in the field collectively between the two organizations in May. We are both coming together for a national sales meeting, you know, in the 1st week of May to kind of get that last level of training up and running. By mid-May, you will have the 98 out there in the field promoting to their doctors as well.
Very, very impressive to have this level of recruitment, hiring, and training to be done in a very short period of time, and again, with a very lean team that's been doing a lot of work behind the scenes here as well. What I'm also pleased to see is it's one thing to hit the number, you know, you know, we could hire, you know, a average person, if you will, to kind of achieve the goal, the number, but we haven't hired what we believe are the average type of people. We've got a very highly credentialed team. From the Shield perspective, as we looked at, we had 34 vacancies. We had over 4,000 candidates looking at those vacancies overall, right? You know, from 4,000, we hired 34.
What that allowed us to do is be very selective and identify people that not only brought good, strong experience in the pharmaceutical selling model, but also women's health experience, which is an area that, as you've heard me say, we've seen really good uptake right now for ACCRUFeR, for half of our prescriptions come out of women's health. On average, those new waves of reps that have come in bring over eight years of average sales experience and four years of average women's health experience, all of which we think can help continue to accelerate that as well.
I will say as the reps come on board here, from an industry average perspective, it takes on average 3 to 5 months for a brand-new rep and no matter, you know, what the disease state, what the territory, 3 to 5 months to kind of get up to a productive level across the board. You know, obviously, collectively, we're gonna try to accelerate that. We'd rather be on the more the 3-month side versus the 5-month side overall. On average, that's, you know, how it kind of plays out. Again, very, very good work, both from the Shield side, but also with our partners who couldn't be more pleased to have the reps on board as well. While I noted earlier that, you know, that type of work that we just went through can be incredibly disruptive to an organization, right?
Particularly on the, you know, both sides, but on the Shield side, I know how many people I have on my commercial team, and the same people that are driving the business are the same ones that had to pivot as an organization and focus in that first quarter of getting that expansion done. What we're pleased to see is that despite all that, we had an increase of 12% prescriptions in the first quarter as compared to that fourth quarter 2022. We also saw continuing that 50% of our business is coming out of the women's health segment, another 43% out of the GPs, and collectively, with that 100-person sales force, that's where they're focused, women's health and general practitioners. That's what their target list is built off of.
We're calling in the right areas to be able to hit that. Importantly, and we won't do this on a regular basis, but I think in this particular circumstance, it warranted diving a little bit deeper into that 12% sequential growth, right? If you think about now the overlay of timing of reps coming on board and training and what they kind of look like, and then starting to think about that from a broader perspective overall, we wanted to highlight kind of month-over-month growth. What we started to see here is in the March timeframe, significant upticks in a couple of the key performance indicators that we want to look at, right? For example, you'd see on the arrows here, you know, 21% growth in the month of March on total prescriptions overall.
In fact, 38% of the total prescriptions for the first quarter came out of that March timeframe overall. A couple other key performance indicators, one of which I think is probably really important, you know, as we look at the lower right-hand box. First-time prescribers, you saw a 24% increase in the first quarter. You can look at the sequence here, right? Down 9% in January, up 41% in February, and then up another 71% in March. Same thing on the new prescription side, right? You know, what we're seeing is as that, you know, kinda newly trained team gets out there and starts getting out in the field, we're starting to see little indicators of what this might be able to look like.
It matches exactly what we wanted to see, which is, hey, as we get a larger team out there, drive that awareness, get in front of more physicians, we should be seeing, you know, increases on the first-time prescribers and other metrics as well. It's early. You know, I would kinda. You know, we're not declaring victory by any stretch of the imagination, but I think it's a really good sign for what we'll be able to see across the board, and we're really proud of the accomplishments across the board on the team. The second piece to kind of layer into that the team behind the scenes have been hard at work at, is this second initiative around amplifying the digital strategy of the marketing initiatives.
I will tell you from experience, you know, redoing an entire brand campaign and getting new collateral out there, et cetera, that is a very big undertaking. The teams jumped in together very quickly here, matching the brainpower and the expertise we bring from the Shield side, in the Viatris side, in the resources behind each organization to be able to do this. We've got a brand-new brand campaign that's launching next month. The setup here, as we've talked about earlier, is that the unmet needs of these patients are absolutely real, right? We've talked about 70% of patients reporting GI issues, a lot of discontinuation rates.
The real concept here that we kind of crystallize this, or the teams crystallize is patients are sick, they're trying to get treatment for their iron deficiency anemia, and in fact, the treatment they're getting to treat this is making them feel worse, right? This whole new brand campaign is built on the irony of that effect, right? Interesting that the irony, it's a very interesting twist on the word iron here as well. This is edgy. It's designed to kind of wake up and stand out in that dormant market we talked about. Look, life is full of irony, and the patients don't need it in their iron.Right? Rather than giving them a product that potentially will make them feel worse, we think we've got a product in ACCRUFeR that can give both effectiveness but tolerability as well.
We've got a number of different things that the teams have worked on here on disruptive tactics. From a personal promotion, all the representatives in the field are gonna have brand-new materials out there to get in front of their physicians with, from the print side, the digital side, et cetera. That team is getting trained at this, at this time point at the main national meeting. In addition to that, a bunch of the tactics on the non-promotional, promotional side, brand new patient and HCP websites, marketing automation to help expand that broad reach, targeted media tactics, and then certainly not last but not least is patient and social activation as well.
A very much, you know, kind of an omni-channel type of approach where in addition to that field force expansion, coming right behind them is that air cover, right, in a number of different ways, and we've never had that before. We're thrilled about the ability of those teams to kind of work together on this. Really the, I don't want to call it the coup de grâce, but the last piece of this as well is that the largest women's healthcare conference here in the U.S., the American College of Obstetricians and Gynecologists, is taking place in the second weekend of May in Baltimore. There's over 4,000 women's healthcare professionals in attendance there as well, and we're launching this new campaign there as well with a really creative and innovative booth that is gonna have tremendous stopping power and memory on this.
It's a booth you can't visit and the irony behind that. Again, the goal here is disrupt the current thinking, get that stopping power, have them pause and reflect on what they're doing in the past and how it's really not been working, and get them to introduce to ACCRUFeR as well. A lot of nice pieces of the puzzle really starting to coming together. The last piece that we talked about is really how do we expand our market access and distribution. You know, right now we're standing at that 100 million covered lives. 40% of the total lives that are co-eligible to have coverage for ACCRUFeR, we've got that as well. We've spent a lot of time working collaboratively with the Viatris market access team. Their level of engagement is extremely high.
We've been doing a lot of data analysis, looking at areas of opportunity. I think this is the beginning of the second half of 2022 now that we can turn our time and attention that the sales team has done, the marketing team has done. This is the next one on the list. Really it comes into 2 different areas. 1 is, how do we take better advantage of the access that we currently have? How do we drive that through, particularly with now the 100 people out there we're gonna have in the field in mid-May? The second piece is, where are areas of opportunity that we do not have coverage? You know, where are PBMs that maybe we don't have access to? A lot of that does get driven by volume, right? These 2 go hand in hand, right?
You're gonna have your 98 or 100 sales reps out there in May driving that larger volume. That's gonna create opportunities for us to work on together. Very optimistic of what we're gonna be able to do there as well. There's certainly this, you know, kind of full, what I call, commercial deployment, if you will, across the board. It's sales, it's marketing, it's access, drives this potential for market for ACCRUFeR adoption, right? You can see our targets here from a market share perspective for the next couple of years across the board. Certainly reasonable market shares to attain, but again, we've got to kinda get out there, wake this market up.
I think, you know, the performance that we saw in the early part of Q1, you start to think about having the full sales force out there, calling their physicians, marketing support behind it, the potential of market access expansion. I think it drives a lot of optimism here, both internally, at us as well as our partners as well. We spend a minute on the international opportunity. All of our partnerships continue to progress. We've got four different areas to kinda touch base on here. The one area that we have that is commercial right now is Norgine in Europe, and then we've got three kind of development or, you know, development stage areas, KYE being the most up to date, pardon me, the closest for approval, and then Korea and China.
On the Norgine perspective, they increased their sales volume in 2022 by 6.5%. You know, we're still working with Norgine. We're certainly not satisfied by any stretch by that level of performance, and we think we can do better. We continue to work with them on focusing their attention to the right call points in the right markets, right? Particularly Germany and the U.K. I'd say Germany is doing probably a better job than the U.K. is at this point in time. We're gonna continue to work with them to drive that because we believe there's a lot more upside here. This is not a product potential opportunity. We believe there's just some execution pieces that we can potentially do a little bit better here.
On the KYE Pharmaceutical side in Canada as noted, they submitted their regulatory package last year. That timeline for potential approval is expected in the middle part of this year. I think gives us a small milestone payment, and obviously on the back end once they launch, you know, tier royalties on net sales. Republic of Korea is in process right now of enrolling their PK study. That is the one study that they need to submit for regulatory approval. We expect that study should be complete by the end of 2023. They'll apply for approval early part of next year. Last but not least, China. China's continuing enrollment with the Phase III study. This study definitely was impacted the last 12-18 months due to COVID in China.
In some ways, while, you know, the rest of the world had, you know, kind of moved past the COVID piece, you know, COVID obviously impacted China quite a bit during the latter part of 2022 and continue to be an impact. We're working very closely with them to kind of figure out, all right, how do we get this study kind of back on track? You know, right now that study is probably out in the 2025 timeframe. There is an important milestone payment for us upon approval there. Obviously we wanna work very close with them, and the communication is strong across the board. Great. Hans Peter, anything to highlight here?
Just very quickly here, obviously we already highlighted the cash balance as of the end of March, GBP 19.2 million. That's corresponding to $23 million.
US ACCRUFeR revenue of GBP 2.9 million, royalty milestone revenues of GBP 1.6 million, plus the upfront we collected from Viatris, our co-promote partner, of GBP 4.2 million, whereas most of that will be recognized in 2023. At the bottom you see our current market capitalization as well as our total number of shares outstanding, which is 586 million approximately. Just to keep that in mind, we're obviously listed on the London Stock Exchange, the AIM market under the ticker symbol STX, but we're also cross-traded at the OTCQX market in the U.S. in New York under the ticker symbol SHIEF.
Very good. Thank you. All right, upcoming milestones to kind of, you know, keep an eye on here. Obviously in the U.S. we're gonna continue. We've got the field force fully trained and deployed. Mid-May they'll be out there, ready to go. We have the commercial booth at ACOG, and you know, we've got a goal for prescriptions. We'll continue to keep the market updated on where we stand as well. On the ex-U.S. side, talked about KYE Pharmaceuticals where we're at. Korea Pharma on track to kind of get their study done by the end of the year, and then we're continuing to enroll in our pediatric study as well. I'd say that's still probably a couple of years away from actually potential approval timeframe.
That gives, you know, potentially another opportunity for another important market segment here to expand and grow from as well. Last but not least, on an ongoing communication perspective, we'll have our AGM in June. A half year trading update will be probably around the August timeframe, and half year financial results in the September timeframe as well. In summary, we're very pleased with not only what we were able to accomplish as we kind of closed a chapter in 2022, but 2023 is off to a great start, right? Got a very focused, dedicated team here. The amount of work that had to be done here to kind of get this thing up and running, and particularly on the sales force side, was incredible, and the team did an excellent job there.
I think we are very, very optimistic of what this could look like. Last but not least, I would say the level of communication and collaboration with our partners at Viatris, far exceeds my expectations. It is a phenomenal group of people, and what I'm really pleased about as well is that the level of engagement between the two field sales forces as they get out there, whether it be the managers, the reps, there's just wide open communication around sharing of experience, what's working, what's not working. We're very much managing this in some ways as almost one kind of unified organization, which is what we envisioned, that's really hard to accomplish in a lot of these types of deals. We're doing a really, really nice job here.
Couldn't be more pleased, and we think this portends to a very, very, you know, be a very fun and interesting second half of the year. I think we're very optimistic of where we go here. All right. With that, give us just a brief moment, and we can kind of look through some of these questions and we'll start to, between Hans-Peter and myself, start to answer some of these questions that are coming through. Just bear with us for just a minute. There are quite a number of questions here. We're definitely not gonna be able to get to all of these, but we'll do our best to try to hit the key themes.
Perfect. Greg, Hans-Peter, thank you very much for your presentation. What I'll do now is I'll just bring your cameras back up. Ladies and gentlemen, please do continue to submit your questions just by using the Q&A tab, which is situated on the top right corner of your screen. Just while the company take a few moments to review those questions submitted today, I'd like to remind you that a recording of this presentation, along with a copy of the slides and the published Q&A, can be accessed via your investor dashboard. As you've mentioned, we have received a number of questions throughout today's presentation. Hans-Peter or Greg, if I could just ask you to read out those questions and give responses where it's appropriate to do so. I'll pick up from you both at the end.
Yeah. Yeah, I think there's one here. Again, bear with us as we're trying to read through some of these and, you know, answer them as well. There's a lot, so we appreciate all the questions that come in. One that just popped in here. There's a question on, you know, kind of Q1 sales. Just reading this here. How many are prescriber driven versus a result of a salesperson interaction? I think this is getting to, maybe a push-pull type of question if you will, right? You know, how much is a push, you know, from a sales force perspective versus, you know, how many are being written without the level of a salesperson there?
It's a, it's a great question, and early on it's very much a push. Much more a push than a pull at this point in time, right? As you think about the map that we put up there overall and where, you know, we were as a Shield contract sales organization and where the new field organization is gonna be, there are so many physicians across the U.S. that have never heard of the product ACCRUFeR, right? Just by way of suggest, we've never been able to get to them with either a field person or really a lot of, you know, the marketing material. Right now it is much more a push of driving awareness, introducing the ACCRUFeR, getting those first-time prescribers, and really getting the office up and running, right?
You got the physician piece that you wanna go educate them, get to write the prescription. The staff does a lot of the work on the payer side to ensure, you know, prior authorizations are submitted, et cetera, et cetera. There are two kind of levers here to kind of think about as we drive the push, you know, then how do you kind of then turn it into a more of a pull, right? Trying to estimate any time point in that is always challenging. Usually you can see it in retrospect, but not, you know, at the point, but there are two maybe levers to think about here. What we have seen in the early experiences, once you get a physician that goes from a first time prescriber to an adopter, right? Meaning that, "Hey, ACCRUFeR is my first choice.
I got the office staff up and running of how to handle whatever paperwork needs to get done as well. Once you get that moving, it does kind of run obviously by itself, but it allows the representative to spend less time at that office, right? Early on. From a frequency perspective, you know, a rep would definitely want to spend time that they've got a first-time prescriber. There's an intensive kind of build-up to kind of get them up and running. Every physician moves differently in time, but there's an intensive build-up, a lot of frequency and follow-up, et cetera. Once you've got up and running, the rep can definitely kind of pull back and spend that same time somewhere else, right? That's, you know, part of how they route their territories and how they design that as well.
You know, they can just pull back. It doesn't mean they disappear, but their frequency can kind of drop down compared to where it was before. The other lever here is on that marketing side, the marketing campaign side. This is the importance of, you know, the digital piece, getting ourselves out at congresses like ACOG. We've never been to a congress like that before. How do you continue to drive that awareness on multiple different tactics beyond just the representatives? Obviously, that's gonna get up and running here, so that'll provide a certain boost there for them as well, not just support to the reps, doctors that they're calling on, but also beyond that 12,000. I guess the last, you know, lever to think about here is that patient, right? How do you activate the patient?
You know, how do you get them, you know, becoming aware of this type of product overall, as you walk into a physician's office and asking for a prescription of ACCRUFeR. That usually kind of lags the physician approach a little bit here, as you saw with the marketing campaign that we're launching, we definitely have that on the radar screen of how do we start to, you know, activate the patient? How do we get involved in the social media side in the appropriate way here as well to really think about activating that patient? You know, once you kind of get...
You eventually will get to a certain tipping point where you'll always have some promotional effort from your reps, but you build momentum where it's less, you know, push and a lot more pull that you see coming in and that's the beauty where we think we can get this as well. Very, very good question there. Hans-Peter Rudolf, any ones that you've picked up on?
Yeah. There was a number of finance-related questions that maybe I'll pick up on those, give you a minute here to take a breather as well.
Sure.
There's several questions really that were related and as per about the cash burn in Q1 2023. I just wanna correct maybe a slight misunderstanding. Of the four elements that brought cash into the organization, two were already 2022 events, meaning that that cash was actually collected in 2022 and as such incorporated in the year-end cash balance of GBP 2.8 million. We obviously used those or a majority of those funds to run operations in Q4 2022. What really was cash that came into the organization in Q1 was two elements. One, the GBP 16.2 million net from the equity raise and open offer. Secondly, the draw of the second tranche after the amendment of the convertible shareholder loan.
If you report or we report GBP 2.8 million at December 31, 2022, add GBP 16.2, add GBP 8.2, we get to GBP 27.2, then subtract the March end of March cash balance of GBP 19.2, that leads to a cash burn, a net of GBP 8 million for the first quarter. Obviously, it's important to recognize that we don't expect that same net cash burn for each of the quarters in the remainder of the year. That would be unrealistic. As we had to start building up this new reality with the new commercial operation and the co-promote partner, we had to pre-invest significantly, that starts obviously investing in the recruitment process, training process, making sure the organization is ready. That's just on the front end.
On the back end, you need to invest into processes, systems, and also get a few other people in-house that can actually support a sales staff of roughly 50 without the sales management team. Quite a significant pre-investment that needed to be undertaken. Quite frankly, the GBP 8 million net cash burn is not something that surprised us or is outside of our expectations. Likewise, we expect obviously the net cash burn to decrease over the next few months and the next few quarters, just as we start increasing sales revenues. Perhaps as an additional element to consider here as well, we had marketing initiatives that needed to be some money spent on, that Greg just alluded to, and there is also a delay in terms of cash collection.
Even some of these sales that we've seen in March, we only expect to collect those in a couple of months down the road in terms of cash coming into our bank account. All that said, it seems a very large amount, quite obviously, but it's also obviously expected by us that we had to undertake this type of investment, and we are right on track on where we want to be. That leads me to the second question that came, and that was, you know, is the cash sufficient to get us to cash flow breakeven? We basically stated that very clearly during the roadshow back in December in connection with the last equity raise, and we don't see anything that would steer us from that view back then.
In other words, we believe by the end of 2024, somewhere in the last couple of months, we actually make the turn and get to cash flow breakeven. And we certainly expect that today still.
Great. Thank you, Hans-Peter Rudolf. I'll give you a breather there for a second, if that's good. There's a question, I think this is an important one, of, You know, I think we both can probably chime in on this one. You know, how do you take, you know, with the cadence of the reps and then the first quarter performance, you know, how do we kind of reconcile that a little bit, right? How do we think about that for the You know, how much is that, you know, a predictor of what can happen, you know, down the road? I think, you know, from a from my perspective, I think Hans-Peter Rudolf, you know, feel free to chime in here. We can yin and yang this a little bit. It's a really important one, right?
That's why I think for us, we spent a lot of time making sure, like I said, job one here, a must-do was getting that sales team recruited, hired, and trained. Absolute must-do. All the work that the marketing teams, you know, are doing, the work we'll do on the payer side, that's not gonna matter unless we get that team up and running, hired, trained, and out there actually calling on physicians and organization for Shield. We absolutely pivoted, and that was the big focus, right? It's like it had to be done, and we got it done. Not only did we get it done, we've got a great team. I couldn't be more pleased with the level of experience I've seen.
Obviously, we got to turn around now and have that execution focus, but that was a massive undertaking with the organization to be able to come out of that where we are as well. The other nice thing is, you know, if you think about where we were in the fourth quarter, the number of reps, you know, how many reps we had coming into the first quarter, the timing of training, I think that 12% really stands out. Not just the March number overall, but really the, you know, the overall first quarter stands out that, you know, we had a significant amount of disruption in the first quarter. We continued to grow, we continued to execute, and I think that bodes very, very well.
This is not a by any stretch of the imagination, we're gonna take what you did in Q1, multiply it by 3 roughly overall to try to get an idea. We're just getting them going on this whole thing, as hopefully you've heard throughout this presentation. Hans-Peter , maybe, another comment here to think through that.
Yeah, I think that's important to recognize. The growth rate stated from quarter-over-quarter was 12%. There's another story behind that tagline, and the story is as follows: in Q4 2022, we had an average 22 reps in the field. They generated, as we reported, to about 9,400 prescriptions, which makes an average prescription volume in the quarter per rep of 425. If you look into Q1, you almost need to kind of separate the sales force in two, because we took on 16 reps that had previous experience and were with us as part of the contracted sales force. Those 16 basically already knew the product, they knew the territories. We had 14 newly trained reps, newly hired reps, essentially joined the team effective February first.
They obviously need time to kind of ramp up their knowledge, get to know the product, the territories. As Greg, I believe, alluded to, in average in the industry, it takes 3 to 5 months until a rep really gets up to speed and can expect to produce fully. If you look at those two elements, we actually looked at how many prescriptions were generated in Q1 from the 16 reps that had the previous experience. Of the 10,500 total prescriptions, it was about 8,500, and that would average to roughly, I've written it down, 530 prescriptions. If you look at the 530 average in Q1 2023 and compare that to the 425 in Q4 2022, that is an increase of nearly 25%.
It's quite substantial and quite a different story than the 12% tagline really tell you. For me, that is really the underlying story of what the product potential is going forward, and particularly in the near term in 2023. If you then extrapolate that over to 100 reps that we expect to have in the field sometime in May, there is huge potential here, and we believe that the numbers that we have, you know, come out with the year prescription volume expectation of anywhere from 125,000-160,000 is still very much within our sweet spot.
Yeah. I think that's a great way to look at it overall. Without any disrespect to our colleagues here, those 14 newly hired reps as well, I think your 8,500 target put in there is probably low, right? I think, you know, we probably drove most of those prescriptions. They're coming up and running. They're definitely contributing. I think that coloring context from Hans-Peter there gives us really confidence of what that now 98, soon to be 100 sales reps will look like once they're out there up and running, full marketing campaign behind it. You can feel like, you know, the level of excitement I think both organizations have, which is great. There was a question on Norgine, just kind of key focus areas as well.
Yeah, look, Norgine, I think, to be frank, we're disappointed with the performance thus far that we've seen. There's been a number of different, you know, conversations and focus areas, particularly focused on the areas where we have kind of commercial organizations on the ground through Norgine, particularly Germany and the U.K., where we have, you know, good-sized markets, you know, good opportunities there, and you know, the ability to have, you know, pricing and reimbursement established as well. We've kind of talked about the need for the potential to call on the market where it looks like there's the greatest opportunity, which is women's health. I will say Germany is a little bit ahead of where the U.K., you know, is right now, and that's a continued area of focus for us as well.
We're not satisfied. We're not thrilled with it and, you know, they're not either, right? We need to work to figure out how to get them up and running, you know, in a way that we think reflects the full value of that product across the board. That full value of the product clearly in a lot of those markets, you know, potentially is in that women's health segment across the board there. I will say, organizationally, you know, obviously they have undergone a lot of changes. They had some ownership changes across the board last year as well. There's been a decent amount of turnover and different people there. All that, you know, that's not my challenge, if you will.
Our challenge has been a little bit of different on the personnel side, but at the end of the day, you know, that's great for them, but I care about our product and getting the most value out of that product, and that's really, you know, my goal there is to make sure we maximize that value. I think that's their goal as well, but we just need to move a little bit faster, smarter, more efficiently to kind of get that thing up and running here for sure. Hans- Peter, any other financial questions you need to hit?
Yeah, actually there's one more here that might be interesting. Again, similar to before, maybe we can both chime in a little bit on that one. There were some questions about the average net sales price of $135 in 2022 that we disclosed. Number of questions on how we expect to increase that potentially and how that's priced off. You know, important to recognize, again, that's an average net sales price and this average net sales price is really dependent on a number of factors. There's two key elements here that I'd like to introduce just to make sure people properly value that number, that amount. Number one, we're still fairly early into the launch, not even two years since the launch.
It is very important for us that both for writers and patients, it's very easy to get access to the product. Which means we continue to make the product available for people that do not have insurance coverage that's currently carrying ACCRUFeR, our product. That's just to create awareness, number one, but also making sure that writers, physicians, have it as easy as possible to prescribe the product, which is important to create the awareness. We don't want to bother physicians to have to look up first, does this patient have coverage, yes or no, and then basically lose a lot of time. It is detrimental to a launch when you're trying to create that awareness.
We are still subsidizing a pretty significant portion of the prescriptions that go out the door, which obviously has an impact on the net average sales price. Eventually, that will change. The second element, you know, we alluded that in the market access piece, was the slide that showed that we have 100 million covered patients. Obviously, there is room to improve here, and we're working very closely with our new partner, Viatris, on that. They have a very experienced large market access team, and there's two elements that we can do to improve the insurance coverage as it stands right now. For one, we can revisit the contracts with our current payers, payer partners, and see if we can potentially better the pricing arrangement, and that's one element.
That takes time, and we're certainly looking to do that in certain instances. The other element is to see if we can get additional insurance companies onto the list of covered payers. That's another one important one that we look to improve. That does take time. Right now, obviously, we are focused on getting the commercial sales operations up and running, get the team recruited, trained and in the field. I would expect that more toward the second half of this year, we're trying to make some push there. The success of that is greatly dependent, obviously, on the other side of the negotiation table, on how they're gonna react and how receptive they're going to be to potentially help us out here.
Yeah. I would add, Hanspeter, that's the push-pull in essence as well, right? The push here becomes driving volume of prescriptions, right? That gets people's attention more than anything else, which then makes it much more manageable on the pull side to negotiate the right level of rebate agreement to manage the business, but also open up access. These things go hand in hand, right? As we've talked to the Viatris team, it's like, "Look, job one, we've gotta get that person, that sales force out there trained, out there driving volume, driving awareness." You know, the physicians, when they demand the product and that demand starts to build, it absolutely helps from a payer perspective. I think you outlined that extremely well.
To go back that kind of push-pull, who's involved in doing what, it's a highly integrated, you know, kinda approach here that we need to think through, and we got the right team and the right expertise in place to manage that as well. Good. We're running up against time here. I've got one last question here that just popped in around just how the two organizations kinda working together. I think as noted earlier, and probably a good way to conclude on this, look, we were working together as we negotiated this agreement with our, you know, partner, Viatris, you know, towards the end of last year. You know, upon announcement of agreement, there's been a lot of work that's had to be done across both organizations, right?
Recruiting, hiring, training, planning for a national meeting, engagement on the payer side, brand new marketing campaign that's getting launched out there, preparation for ACOG. It's really, you know, we're 4 months in, and the amount of work that has been accomplished here, you know, certainly for us on our side, but, you know, for them on their side, is just outstanding. The level of consistency, communication, collaboration. You know, somebody was just down at one of the recent training classes, and you can't tell a Shield rep from a Viatris rep. Everything we are doing is together to promote that level of collaboration and communication, and importantly, sharing of experiences. We have accelerated the entirety of the 2 organizations up to get to that 3 to 5-month productivity as fast as humanly possible.
That's part of why we're doing a national meeting together as well. You don't see that too often with these types of agreements where both companies come together in one national meeting and go out and execute that. It just, it's been excellent. You know, we're excited. You know, the heavy lift is kinda, I wouldn't say, I don't wanna say behind us, but one of the big lifts is behind us. We are now very much shifting to execution, right? Good field coaching. You know, support for our reps, getting them up to speed as fast as possible, launching the new campaign. All that execution takes place now, and, we're very, very pleased with where we are to date.
Now we execute, and now we look forward to where we can kinda get this product to, and this is the way we always thought we should launch this product. I'm actually excited to be at this, you know, kind of point in time with all those resources coming behind us. Thank you again for all of your time, your interest, your attention. I apologize we couldn't get to a number of the different questions there, but we appreciate everybody's interest, and we look forward to keeping you up to date on our progress throughout the year.
Greg, Hanspeter, thank you very much for updating investors today. Could I please ask investors now to close this session, as you'll now be automatically redirected to provide your feedback in order that the management team can better understand your views and expectations. This will only take a few moments to complete, but I'm sure will be greatly valued by the company. On behalf of the management team of Shield Therapeutics plc, we'd like to thank you for attending today's presentation, and good afternoon to you all.