Good morning, and welcome to this Q1 presentation and Q&A with ViroGates. With us today, we have the CEO and the CFO. First, there will be a presentation, and afterwards, a Q&A, where the management team will answer questions submitted via Stokk.io. There have already been pre-submitted questions on Stokk.io, and the Q&A is still open so that you can submit questions live as well. I will now hand over the mic to ViroGates to start the presentation. Your line is now open.
Yes, good morning, everyone, and thank you, Anas, for the opportunity to present ViroGates this morning with Stokk.io. We are presenting our Q1 report, and as mentioned by you, my name is Jakob Knudsen. I'm the CEO, and I have by my side here, Josephine Jørgensen, who's the CEO of- CFO of the company. So, without further ado, I think we will commence the presentation. Typical forward-looking statement. I will give a short background on our company, so maybe it may be trivial to some, but just to get everybody on the same page. ViroGates is a diagnostics company that was founded back in 2001. It's a spin-out originally from a Danish University Hospital, Rigshospitalet, and we are currently 12 employees.
We listed on Nasdaq First North here in Copenhagen in 2018, in June, and we work to improve patient outcome and people's lives by providing this inflammatory biomarker that we've labeled suPAR, hence the acronym, suPAR Charging Triage. What we target to do here at ViroGates is to address some of the global healthcare system issues that we are faced with. We have the increasingly aging population that are increasingly also experiencing these inflammatory diseases calling for personalized treatment. We have a growing labor shortage. The elderly population needs to be served by the youngest in terms of their care, and we also have the pressure on payers with these new treatments coming out.
We all demand to live healthier lives for a longer period of time, and we've created our opportunities around those increasing pressures. So, we basically work or strive to improve the patient outcomes, reduce the healthcare cost, and empower clinical staff. Those are our value proposition that we work with every day. suPAR is a naturally occurring protein in the human bloodstream. It's basically cleaved from various cell types in the surface of our blood vessels, and it basically reflects the immune system's activation level. And hence, it can be used to gauge the current health status of presumably healthy individuals.
That's how we work in the longevity and health check area, but it's also a strong indicator of chronic inflammation when it's heightened and a predictor of whether the patient in question needs to be admitted to the hospital or can be safely sent home. We have today, to date, more than 1,000 peer-reviewed papers, and this is in all areas of diseases with a chronic inflammation component. It ranges from cancers to type two diabetes to actually psychological issues and so on, where suPAR has been investigated. And in every indication, it's true to say that the more the disease is in activation, the higher the suPAR level is, and hence, we use it to gauge that situation.
Also, as a general thing, as mentioned, the higher the suPAR, the worse the outcome, and this is depicted on this slide, where you basically see that the levels of suPAR predict long-term outcome. These are data from a clinical study in a hospital setting, but it goes actually also for healthy individuals. There are many more patients or individuals in the 0-4 nanograms range than there is in the high range, fortunately. But you see, if suPAR is as elevated as around 10 nanograms per milliliter or more, there's actually a risk of mortality, hence the risk of the patient dying in of about 50% in 90 days.
Fortunately, there are not that many patients that experience this, but we do see it in the acute care setting. So this is generally how suPAR works across disease areas and also for the healthy individuals. We've created various use cases for the suPARnostic, and one of them, the first one that we promote is the suPARnostic in acute care. The way we use suPAR here is based on many studies. We have more than 50,000 patient cases that have gone through this. Some of them have been reported in clinical papers as well. And what we've seen is that four nanograms per milliliter of suPAR is a very good indicator of a supporting discharge.
So, if the suPAR level is low, the risk of something worsening in with the patient is very low. So, then it's a strong supporter that the patient can be discharged early. On the other side, the patients with more than 6 nanograms per ml, they need to belong in the hospital. Something needs to be done, and hence, this is an alarm sign for the treating physician in the acute care that this patient likely needs further investigation and medical treatment. This is further, a further analysis of some of the data that you've seen, where basically the lower bars in the individual colors reflects how triage is done utilizing some of the traditional parameters.
There are various types of triage systems, typically designed on various other biomarkers, such as the consciousness level of the patient. Does the patient have fever? And so on and so forth. Those are also biomarkers as suPARs, and those are some of the clinical signs that are typically used in a scoring system. But if you look at the bars above, the ones in the stronger colors, you can see that especially the yellow patients, they are... Sorry, I got them wrong. The lower bars, I mean. You see that the yellow patients are distributed into more of the green patients or the red patients.
And hence, we actually get a better triage by utilizing suPAR on top of some of the systems that we already use to date. Therefore, you can also derive that you can reap some benefits, monetary benefits, and clinical benefits from utilizing suPAR in this setting. Another use case that we've gotten some recent data from is how suPAR guides treatment. We utilized it in COVID-19, but we also now use it in sepsis. Sepsis is an indication that we've looked at also before, but we have recent data that suggests a very clear-cut clinical algorithm for how to utilize suPAR to the benefit of the patient. Sepsis is a deadly condition. It's one of the primary mortality reasons.
It affects many in the acute and intensive care wards, and hence is something that needs to be treated very early on, when it occurs, for the patient to have a chance to survive. We have done a study with a very good collaborator in Greece, a professor called Vangelis Papouteli. He set up a study where he used suPAR to triage whether the patients needed a certain antibiotic treatment early on, or they could actually wait. So, the way the system works is that if the patient has a high qSOFA, as it's the traditional scoring system, the patient is typically treated very early on.
But if the patient has a middle range qSOFA of about one, but still has a high suPAR, the patient needs to be urgently treated with antibiotics because this is an alarm sign, a warning sign that suPAR actually looks into the body of the patient and signals that something needs to be done earlier than the clinical symptoms otherwise occur. So, this is a very encouraging sales proposition that we have now to the market, because that's how physicians typically look at utilizing biomarkers in clinical practice. So we are very encouraged by this, and we already see interest in this particular use case from some of our clinical collaborators. The last one that I'm gonna go through is the use case in general health.
As you've seen, we've shifted much of our promotion to general health use, and there are various also commercial opportunities in this sales cycle being shorter and so on. But I'm gonna touch upon how we utilize it initially. Basically, as you saw, the higher the suPAR, the worse the outcome also for the healthy individuals. So a otherwise presumed healthy individuals, healthy individuals who goes for a medical checkup, typically maybe self-paid basically has a very good tool to see if chronic inflammation is on the rise or maybe personal interventions are working. A very clear-cut case is the smoking.
If a otherwise healthy person comes into a clinic and is smoking and cease smoking, we actually see that suPAR levels, typically over about 14 days to one month, decrease by one nanogram per mL. So basically, the patient lowers his or her biological age already by this smoke cessation. There's other interventions, such as we all know, we need to exercise more, we need to improve our diets, and so on. So the typical remedies are the same, but suPAR provides a very good way to see in numerical terms, is this working or not?... So this is something that also is of really high interest to us now, to basically gauge how much systemic chronic inflammation is present in each and every one of us.
This next slide is data from a study that we ran, actually some years ago, the MONICA cohort here in Denmark. But what it shows is that individuals with higher suPAR levels have an approximately 15 years increased age, if you like. On the contrary, if these suPAR levels are low in a particular individual, he or she may have 15 years of increased life expectancy. And we all talk about whether it's the numerical life expectancy or the quality of life, but it basically amounts to the same thing. suPAR can be used for a better life in gauging which interventions are useful to conduct, and you and the individuals actually see some benefits from that.
We've run with some initiatives also with influencers and people that are promoting this online, these camps and so on. And we actually see that we've seen in one case that all of the participants lowered their biological age over three months with these interventions. So it's very interesting, and we got a very good feedback from the individuals undertaking these interventions because they actually saw a tangible results of the interventions that they did. That's. I think it's important for all of us, that we see some effect of these life changes. And then I'm gonna hand over to Josephine.
Yeah. Thank you, Jakob. I'll speak a little to our products, the highlights of our business model and our team. So ViroGates has a product suite consisting of four products, and those four products, they cater both to high-volume hospital settings, as well as the smaller healthcare clinics that Jacob just touched upon within longevity and general health. When looking at our products, the first product we launched was in 2009. It's the ELISA plate, so the lower right corner. It's mainly for research use, since it's a measurement method that allows for the measurements of many samples at the same time, which makes it eligible for mostly research. Then the second product we launched is the Quick Triage. It was launched in 2015.
The Quick Triage is a near patient use lateral flow test, meaning that you're able to conduct the suPAR measurement in near proximity to the patient. However, with the QT, you still need to be also in close proximity to a laboratory, since you need to take the blood from the patient intravenous, and then you have to centrifuge it to get the suPAR measured. Then in 2018, we launched our TurbiLatex product. This is the product that are used for the automated clinical use, the high-volume use, typically in hospitals. We have validated our turbidimetric product on several of these platforms and systems, including those by Siemens and Abbott, and Roche, and Beckman Coulter. And then, latest in 2023, last year, we launched our finger prick product, the POC+.
As with the Quick Triage, it's a near patient use test. The difference to the POC+ and the Quick Triage is that while with the Quick Triage, as I said before, you need a laboratory with a centrifuge, the POC+ is able to capture the suPAR measurement in a finger prick of blood, so in full blood instead of plasma. But as we've also announced, based on some of our initial customer reviews, when we placed it last year, we are further developing the product with our collaborator, Genspeed, to make sure that it measures to the point that we wish it to. And we have a commercial presence through both direct sales representatives and an established distributor network. Our direct sales agents are in Denmark and France, Spain, and Benelux.
And, then we have a network of currently more than 15 distributors that covers largely the rest of Europe and, other areas, in the rest of the world. And then I think a note is also to be given to the orange part of this map that states, "Research use only." And, this means that, in these locations, we don't have a market clearance to, commercially promote our products for clinical use, but we're able to, sell our products for research projects or research use only. And that's especially the case in North America currently. And speaking of North America, we're also we have been for, for a bit more than a year now, working together with Sobi on making suPARnostic available in the U.S. market, so gaining this market clearance.
Based on the post-authorization requirement that Sobi received on their EUA for their product, Kineret, this requirement stated that they needed to contribute to making suPARnostic available in the U.S. market. Last year, we entered into an agreement with Sobi on doing so and in the beginning of 2024, so in this first quarter, we did a collective filing of an application or submission through the Q Submission scheme. And we've had, in April, the first meeting with the FDA that delineates what should be the next steps in this process. We're currently developing a plan for this, and we will elaborate on it when we have more concrete information to that.
And then, a short overview of our management team and our board, who collectively has many years of experience in life science, diagnostics, and healthcare. I think that was it for the general going through. Then we have what today is actually about, our quarterly report that came out yesterday. I will put a few comments to that. So the level of revenue that we saw in Q4 still reflects that customer activity is relatively lower in the lower end, although we ended up 14% up from the same period last year, we ended up at DKK 1.2 million. And then our operating expenses increased by 18%.
In particular, our expenses to sales and distribution increased in the period as compared to last year, which is a result both of our continuing work to expand and refine our distributor network, but also our realignment of our sales and marketing materials to cater to this new general health and longevity segment, as Jakob mentioned. Our operating loss increased by 13%, and our net loss increased by 22%, and then our cash position was strengthened, you might say, as compared to last year, mainly because of the rights issue that we concluded in the end of 2023. Digging a little bit deeper into the revenue metrics, this graph shows revenue by product type for the first quarter of 2023, and then the latest quarter, first quarter of 2024.
You will notice that the largest difference is in our sales of TurbiLatex and ELISA, respectively. For TurbiLatex, you will notice that sales of TurbiLatex has decreased as compared to the same period last year, which is primarily the exemplification of the loss of these customers that used our products for COVID-19, the hospital customers that had quite high volume of use during the pandemic. And on the opposite side, you'll see that the ELISA sales accounted for a larger proportion, which is the continuing research interest that we witnessed from all over the world in our suPARnostic products. And when you look to geography, the view hasn't changed remarkably since the same period last year.
Europe is still our primary market, followed by North America, and then we have slight sales to the rest of the world. Looking to recurring customers by segment, I believe it's neither a surprise that, as compared to the first quarter last year, we can report by the end of this quarter, a few fewer customers, down 3 customers. This is mainly also a result of the difficult year we had last year. As you see from the graph, it's the clinical routine customers that has the recurring clinical routine customers that has gone down, while the recurring research customers are kept constant. I think that was it for me. We're ready-
For us, I guess.
For us. Yeah, we're ready for questions.
Perfect. Thank you, Jakob and Josephine. Let's go to the Q&A and start with the first question that has been submitted here. When do you expect to begin to see traction on the ramp-up of revenue and sales?
Yeah, I can address that shortly. Obviously, this is kind of one of those forward-looking statements, so it's actually difficult to address. The easiest answer is to say, we can't really comment, but, I'm gonna point to some of the initiatives that we're doing anyway. As I mentioned, we've started this selling to this new segment of general health. And generally, we expect that the turnaround cycles, the customer cycles for selling into this segment is shorter. And the reason for that is that, basically, as long as a health clinic can sell the result to a customer, they are per default interested. We need, however, also to get typically a lab to perform those analysis.
So it's not really clear cut, but it is a shorter sales cycle than with the hospital customers, where there's a lot of politics involved, a lot of budgeting in silos and so on. So we do expect to see some of that kick in relatively shortly. We've had very good first meetings. We are already seeing some marginal sales, but we are seeing a pattern here that we sell into that. So I expect that we can do better, but it is really, really hard to tell.
... If we stay a bit in the same lane, maybe you have something to add here, but the next question is: how many orders and how many customers did you secure in Q1 within general health and longevity?
Yeah, I can, I can add to that. I mean, as Jakob says, we're not able to disclose how many orders or what specific customers that we've had for the quarter. But what we've seen and what we've been working with is establishing these new . . . not new, but to our experience, new sales channels and ways of selling into the general health segment. It is widely different from selling into the hospitals, since you need to kind of get the key to unlock the potential, both among the central laboratories that typically perform the blood analysis for these clinics, and then also get the clinics interested.
So what we've worked with, and what we've also, also succeeded with, I think I can say that during the last quarter, is to do that in a couple of examples where we find the right balance of making the network of health clinics ask for suPAR, and then target the laboratory, setting it up at a central lab at the same time. That's really a fine balance to make sure that the whole ecosystem around using suPARnostic in the general health segment is available. So I think that's the amount of comments I can put to that.
With the increasing amount of papers written on the use of suPAR, what is the reason for doctors not using it more? Why is there not a connection between studies and usage?
Yeah, that's also a very good question. I think the general comment is that there's no sort of set number of studies that will be performed, and then everything ends. If we look to other biomarkers, like we typically look at C-reactive protein, which is the inflammation level that you typically get measured with your GP. We look at procalcitonin, we look at troponin, and so on. Actually, the number of studies keep increasing, and that's because research is always conducted into slightly different aspects of a particular disease type. So there is a demand to keep doing studies, but I appreciate the question.
I think it's fair to say that there's not a one-to-one correlation of the research interest and the clinical implementation. There are these political issues with clinical implementation. So irrespective of... I mean, we have one customer who's very frustrated that he can't get it into the clinic because the hospital lab does not allow for further spending on biomarkers. So unfortunately, the clinical results doesn't really resolve that issue. So we are in that segment stuck with a slightly more political sales opportunity than we are in the general health.
So I think also as a commercial person, we like the fact that we can hedge some of that political risk, if we like, to with with the general health, where where the market mechanisms are slightly more normal, if we if we like. So I think we appreciate the the increased level of research interest. I think the dynamics is such that nowadays customers appreciate that they need to pay for our products. In the past, we had to seed all of them. So so there's there's also a commercial element to the growing evidence and and number of studies that we do.
What is the timeline for finishing development of the POC+ product?
Yeah, that's... I don't think we mentioned it very specifically, but we launched the POC+, and it's actually cleared for use in the market. We unfortunately experienced some problems when we had it in the hands of customers. Fortunately, we were still with the customers on the sideline and so on. So we had to pull the product back to a certain extent, and we're not actively marketing it right now because we are working with these challenges that we've seen. So we have a number of meetings with our product developer, the Genspeed team, to try and resolve some of the things here. And those are all very technical aspects that needs to be done.
Unfortunately, the timeline is very hard for me to judge on, and the reason is that I've seen the development of both the turbidimetric product and also the quick triage, and we had many iterations. Each time we're moving a slight bit forward, but it does take some time. So, we can't really put a fixed timeline to it, but we're not talking years.
Are you working with influencer marketing or consumer-generating demand to make consumers within biohacking, longevity, and general health aware of your solution and create demand directly from the consumers?
Yeah, I can take that. I mean, I believe the answer is yes. Since we started targeting this longevity and general health segment, we've also acknowledged and experienced that the way that the way that knowledge around these new biomarkers or way of measuring your progress or just initiatives you take to get a better health, the way that they are shared is widely different from what we've done previously, at least to hospitals. So yes, we have engaged in activating, you might say, influencers or biohacker, groups of biohackers. As Jakob mentioned, we've been part of now several boot camps where people that are biohackers are already very invested in their health. They meet up, then they have a coaching session or several coaching sessions in a matter of months.
They get certain interventions, and then they get their suPAR measured again. We've experienced, as you said, Jakob, that people have been very happy to the fact that they're now able to very concretely and numerically measure what the effect of their initiatives are with the suPAR. So that has definitely worked for us. Then we have also worked extensively, both, I would say, the last part of 2023, but also this quarter on aligning our marketing material and figuring out who are we supposed to to target our marketing to within the general health and then longevity segments.
And then the last question, did Q1 start out as you expected, or did anything surprise you positively or negatively during the quarter?
Yeah, I can answer to that. I believe the Q1 started out as relatively as expected. I mean, we finished off 2023. It had been a quite difficult year in regards to revenue for ViroGates. So, I would say that Q1 has performed as relatively as we expected.
That was all the questions, so that finalizes the Q&A. But before we end the webcast, I will just hand over the word for you, if you have any final remarks to end with.
Yeah, I, I just want to thank everybody for posing questions, both in advance and on the call here. We appreciate the interest and, although we, as Josephine said, are not completely through the troubled period, we are very ambitious and hopeful that we can change this. It does take some time, but we've gotten very good use cases, so we are looking to be here for, like, a half-year report, with a lot of confidence.