Hello, ladies and gentlemen, and welcome to the Biotest AG conference call regarding the third quarter results in 2022. At this time, all participants have been placed on a listen-only mode. The floor will be open for questions following the presentation. Let me now turn the floor over to your host, Monika Buttkereit.
Hello, good morning, ladies and gentlemen. It's a pleasure to welcome you today to our nine-month call. As usual, you will find the presentation on our website, the investor relations, publications, and then presentations. With this very short introduction, I would like to hand over to Michael, who will give you further information.
Thank you very much, Monika. Indeed, I would also welcome you on this wonderful Monday morning. Wonderful view to respect. First of all, sun is shining here in Dreieich, close to Frankfurt. Secondly, you may have seen already that we have published two press releases this morning with pretty good and very exciting news. To make you familiar with those issues, I have trusted my team this morning. I'm also greeting Jörg Schüttrumpf, CSO of Biotest here. He will give you an update on our R&D projects. For the first time, I welcome Peter Janssen, COO, and successor of Georg Floß. He is responsible for production, supply chain planning, product development, also for engineering, and for sales and marketing. The last area of responsibility gives us the best joy for this morning. Peter, please take over to make us familiar with the latest developments.
Thank you very much, Michael. Also, nice to meet all of you and welcome to this morning's meeting. I'm also very happy and also honored to announce that we've got the national authorization for Yimmugo, which is our new immunoglobulin. Yimmugo is this, let's say, the brand name we have chosen. Yimu in the name stands for, speaks for immunoglobulins or antibodies, which is one of the most important products currently coming out of plasma proteins. The go at the end of the name is standing for our future-oriented vision, go for the future. Around it, we have a symbol of green and blue dots.
Really, these are colors from nature, which is symbolizing tranquility, but also depth and trust. That really stands for the protection of both our patients as well as our nature. At the very beginning of this logo, we have a Y, a letter Y, which is really a representation of a immunoglobulin or an antibody, where, let's say, the top parts of the Y really are seeking for antigens. What is Yimmugo? It's a highly tolerable replacement therapy, and it's also sustainably delivered. Currently, the Yimmugo is a 10% immunoglobulin preparation for intravenous treatment, so it's a sterile vial with injectable liquids.
It's not only produced through an innovative and unique manufacturing process, resulting in IgG with higher efficacy and tolerability, but also the production process is more sustainable. In terms of, let's say, improvements, it's certainly a product with proven high efficacy. It's really well tolerated, favorable safety profile. Injection speed is, let's say, better than the average. We have a convenient dosing schedule, rapid infusion rate, like I said. Again, the innovative and sustainable manufacturing process really speaks to this product. On the pictures, you can see representations of a 5, 10, and 20-gram packaging.
It's not only a product, it's also a process, and together with that process, a totally new manufacturing, let's say expansion that we started in 2013, so nearly a decade ago with, let's say planning, construction of the facility, construction of the process, and also ancillary buildings, for instance, for storage, but also supply of ethanol, also energy, et cetera. It's a totally new expansion of this, let's say, site here in Dreieich, Germany, which will really expand not only production capacity, but also the number of processes and products we can deliver, and also, let's say the yields of those different processes.
It's really a novel concept for the site here, but it's also something that could be later replicated to other locations. This is a multi-story building, and actually, the production process uses gravity, where plasma from donors is really brought to the top level, and then in successive stages, further fractionated into different proteins and purified to bring a high quality intermediates or drug substances. It's a green building also. The building was made with low pollution and low emission materials. Like I said, also the gravity concept conserves energy. Also, during the production process, many environmentally friendly chemicals are used where possible, as compared to, let's say, chemical pharmaceutical products.
This is really a quite green production process where, let's say, starting with donated plasma, we use a lot of ethanol, so alcohol and water in the process and some chemicals, but in really sustainable way. The yield is higher than before. That means for every protein that is produced, less plasma is consumed, but also less energy, less other materials to get to the same outcome in terms of products. The waste in terms of heat is reutilized for air conditioning, so a lot of the waste streams are reutilized. Also, water is reduced, water consumption is reduced and less waste is produced.
Really novel concept, like I said, later stage could probably be expanded, replicated, at other locations. To summarize, if you go to the last slide number eight, it's really something that will be very important for the future profitability of Biotest. It's the first product we make from this new facility, which is a big milestone after, let's say, 10 years of preparation. It gives us the future of intravenous IG. It's a profitable product with a higher capacity, higher yield. Like I said, manufacturing will be based here in Dreieich to protect local jobs, but also provides options for the future.
Really sustainable focus, sustainable mindset, and that also translates into the DNA of the company, which is where we see that this is really important for our future. Again, also this product could be also brought to the U.S. market. We are preparing for this, and the U.S. market is also a very important market for this product. With this, I would also, because I was, let's say, bringing the message, really thank my colleagues here in the room, but also the many colleagues at Biotest who've been involved in the planning for this, the preparation, the projects, the development, the research activities, but also will now be responsible for manufacturing the product, selling and marketing the product, and also all the support functions. Many thanks and yeah, big success for yeah, that we can announce today.
Yeah, indeed, Peter, thank you very much. I think we can now really summarize that we have really BNL, Biotest Next Level with the first market authorization for the first product produced in this new facility here in Dreieich. Coming now back to the figures of the first three quarters of 2022, those numbers do of course not reflect the expected success of the new Yimmugo product, but of course incorporate the costs which were invested, you know, here in order to get to this successful step of getting the market authorization. If we look at the income statement, which is printed on page 10 of our presentation, it all starts, of course, with sales, which EUR 360.8 million were being achieved in 2023. This is -3% less than in the same period in 2021.
You can see, you know, if you look at the different segments, we have lost 3.6% compared to last year in therapy, while we earned 6% more revenues in plasma and services due to higher toll manufacturing activities, while on the other segments, the merchandise was EUR 0.8 million lower than in 2021. Altogether, as I said, we ended up with EUR 361 million in revenues and sales compared to EUR 371 million the year before. That brings us, after deducting all costs and expenses, to an operating profit in EBIT number of EUR -19 million compared to EUR -11.2 million in the year before. You will see later on where this difference, this negative difference is coming from.
Financial result and taxes we had also to pay reduces the loss further to our earnings after tax of Biotest Group in 2022, end of September, with EUR -34.2 million compared to EUR -28.3 million in the year before. If you look a little bit deeper into the sales development in the different regions of the world, you will see that we have been able to increase our sales and revenues in Central Europe and also in our intercontinental business, while in Middle East, Africa, France, as well as in East South Europe, Central Asia, and America, our sales were lower due to lower business with the plasma factor VIII preparations.
Mainly if you look at the countries, it's not surprising that we have achieved less sales in Russia, Turkey, and Iraq, and that explains why we are in total 3% below the last year's sales revenue. Turning to the EBITDA report that you know already that we differentiate a little bit between the operating income of the normal active business and then show also what we have paid for getting Biotest Next Level facility ramped up, as well as our costs for the three Biotest Next Level R&D projects, which Jörg Schüttrumpf will explain in detail a little bit later on.
Starting with the reported earnings before interest and tax number of EUR -19 million, you know, if we would add back all the EUR 33.6 million we had invested in getting Biotest Next Level facility running and also adding back the EUR 29.8 million, which we spent for trimodulin, fibrinogen, and IgG next generation Yimmugo in the last nine months, adding also the Biotest Next Level administration costs, we would end up with an adjusted EBITDA of EUR 44.9 million, which is the income, the operating income generated by our existing business. Products produced here in Dreieich at the site, on the existing site. Explaining a little bit more, our spending for Biotest Next Level activities on page 14 of the presentation, you see that we spent EUR 33.6 million in the nine months for facility costs, energy building costs, maintenance, et cetera.
Depreciation is included in this EUR 33.6 million, as well as personnel costs for commissioning, validating, and ramp up the facility, and also project administration accounts for the EUR 0.5 million, administration costs shown on the previous page. The R&D costs of the first nine months in 2022 amounts to almost EUR 30 million. We spent EUR 5.6 million for the development of Yimmugo, the IgG next generation product. We spent EUR 16.1 million for the development of trimodulin, our IgM concentrate, and EUR 8.1 million had been necessary to invest it in the main phase III studies for fibrinogen. All in all, we spent EUR 64 million in the first three quarters of 2022.
On page 15, you see the reference sales, EBIT and adjusted EBIT figures in comparison to last year's, and I have explained those numbers in detail right now. Jumping to the balance sheet, you see there's less movement over there. You see some on the current asset side. You see a decrease in trade receivables, a decrease in cash, and on the other hand, you see increase in inventories and financial assets. Overall, there's nevertheless a decrease in the total amount of assets and, of course, a corresponding total decrease also in the total amount of equity and liabilities at the end of September 2022 compared to end of December 2021. The decrease in cash is mainly driven by negative cash flows generated by an increase in inventories.
Spending for working capital in total was EUR -13.7 million, and also to pay interest and taxes of EUR 11.8 million. Therefore, we ended up with this decrease in cash of EUR 51.1 million because also CapEx, cash flow for investing activities in the amount of EUR 24.8 million is also included in the numbers. Now it's interesting, probably most interesting, to see what will happen in the remaining five to six weeks of this year. We, in March, projected that our sales will be probably end up at the same level as in 2021 with EUR 516 million. There might be some risks that it will be between 5%-10% lower. I think we can reduce this range here to a -5%, with regards to year-end numbers.
You've seen that currently we are -3% below last year's sales level, and this may prevail as the right number till year-end. On the EBIT side, I would like to remind you that end of March in 2022, we have given an operative guidance of EUR -20 million to EUR -25 million, but with a caveat raised with regard to the further development of possible negative impacts of the Russian war in Ukraine. We didn't know what's going on with COVID-19 activities. We have seen and seeing right now still a very high sickness rate in our facilities here. Of course, we were not aware how the gas shortage will develop over the year 2022. Therefore, we said that we might end up with a EUR -40 million to EUR -60 million EBIT level at the end of 2022.
Now, since the year is almost over, we can exclude that the worst case will happen. You won't expect, you can't expect that we end up with EUR -40 million to EUR -60 million. We would keep, you know, the guidance that keeping all different influential factors still existing, seeing all those existing risk factors in place here, we might end up with EUR -20 million-E UR -25 million on the EBIT level in 2022. Nothing has, of course, changed all the negative impacts and risks we have seen over this year that our sustainability goals are the same. You know, our products are, of course, based and made from renewable raw materials. We have a low environmental impact in producing our plasma protein preparations.
Also we are increasing our efforts to change to a climate neutral production, as well as scope one and scope two on the international measurement scale by switching to green electricity, have voluntarily compensated measures for all greenhouse gas emissions, and are actively, of course, installing additional photovoltaic installations here in order to reduce our emissions further. Yeah, with this general outlook on what's going on, sales and EBIT wise till the year-end and also on the sustainability level, I would now hand over to Jörg and giving us an update on the R&D projects.
Good morning, everyone. It's my pleasure that I can give you today the R&D update. I immediately switch to slide number 23. What I want to do first is, of course, giving you an overview, with two different aspects. The first one is that with our development, and this you see here for the therapeutic areas, we really concentrate on our core experiences and core areas. The first one is clinical immunology, where we already have the poly-specific immunoglobulin Intratect, but also different hyperimmunoglobulins and hematology, where we currently have Haemocomplettan and Haemonine, the two coagulation factors. Intensive care medicine, where we have two products also with IgM and IgA antibodies, Pentaglobin and Biseko, and also human albumin.
The second aspect in our R&D development is that we really focus on the late stage developments of our products. Here, the main focus are the new products. You heard already from Peter, the great news that we have now the marketing authorization for Yimmugo, our IgG next generation product. We are also developing fibrinogen, and here we are already in phase III . One phase III trial is already completed. The other one is ongoing, and I will show you a little bit more details later. On trimodulin, also here we started this year two phase III trials, and I will show you also more details in the later slides.
Now, it's not all the new products, but we are also developing further our existing products here, especially the immunoglobulins, where we see great potential for Cytotect, where we do a phase III trial in a cytomegalovirus infection during pregnancy. But we also have more activities where we collect real-life data and also work with different key opinion leaders on investigator-sponsored study to really develop these products further and collect data concerning indications where we see additional commercial potential. Now, let's switch to slide 24 to show you the progress of our R&D pipeline. Here I have to say this year was so far a very successful year for us. A big part of this is also our new setup with Grifols as major shareholder, which helped us really to accelerate our key developments.
This is not only reflected in the financials. Michael just showed that we are spending more money, but you can also see that we are progressing much faster. This you will see also over the coming months and years, how our programs will progress. Now, IgG next generation, now Yimmugo, we already talked about the new registration, so what is coming next? This is really to focus here on extending the usage in new fields, in new indications. Here we are preparing in the dermatology field, a new high-dose indication and a new trial with focus on Europe and the U.S.
For fibrinogen, we had a very successful interim analysis in the first half of this year, in which we included a new indication, and I will show you some more on this also in the next slide. We are planning a second interim analysis, and for this we are currently recruiting patients. For trimodulin, we started the first two phase III studies, one in COVID-19 and one in severe community-acquired pneumonia or SCAP. Both trials are now in the setup phase, and we expect the first patient included in the first trial every day now from now on. For Cytotect, we also perform a phase III trial, and this trial is recruiting as expected and going well.
As I mentioned, for the hyperimmune immunoglobulin Cytotect, Varitect, [audio distortion], and Hepatect, we are performing non-interventional studies to collect real-life data. For Cytotect, this is especially in heart and lung transplantation. We see there, for cytomegalovirus, different antivirus coming up, and we see that there's a good option for us to combine our treatment also with new therapy options that are coming to the market. For Varitect, we are focusing on herpes zoster infections. Herpes zoster, as you probably know, is a big problem for many, many people, and we see here additional commercial perspective, and we see a lot of patients suffering, where we think that Varitect could really make a difference in the treatment of this disease.
For Cytotect and Hepatect, we are currently working on chronic hepatitis B virus infection, and this is together with different KOLs, where we sponsor and support the investigator-sponsored studies from these investigators. Now I want to go in the next slides really a little bit deeper. We go to slide number 25. For Yimmugo, one question that very often comes, why do we need really a new immunoglobulin when we have Intratect which is a great drug? And there are different things that are really important. First is we want to maintain the excellent efficacy, both in immunodeficiency but also in autoimmune diseases. We want to maintain the excellent safety profile and the high quality we have.
With Yimmugo now, we could further improve this with all the experience we have, for concerning user friendliness but also higher tolerability. The optimized yield that Peter already mentioned, and this is the first immunoglobulin suitable for worldwide commercialization. We further can, with Yimmugo, also use our new manufacturing process to get other proteins out of the plasma and therefore Yimmugo is really the base, for our development in the decades to come and, a very important milestone today, with this first approval. Now, let's switch to slide number 26. Our second new product coming out of the Biotest Next Level plant, and this will be f ibrinogen. We are developing this in two indications, congenital fibrinogen deficiency and acquired fibrinogen deficiency. For congenital fibrinogen deficiency, we already completed the trial.
This was a phase I, phase III trial with two parts. In the first part, we demonstrated pharmacokinetics and pharmacodynamics, and in the second part, we established the excellent efficacy and safety of the product. We overall recorded 175 bleeding events in 36 patients, and with this is the largest clinical trial in congenital fibrinogen deficiency worldwide performed so far. The overall hemostatic response was excellent. We saw basically in all treated cases a successful treatment and the study is completed. Now, the other phase III study is still ongoing, and this one is in spinal surgery and pseudomyxoma peritonei surgery. This is a kind of complicated tumor surgery. On the right bottom of the slide, you can see the setup.
Patients get a surgery, and then they have a major blood loss and this is a decision to treat, and patients are then randomized either to fibrinogen or standard of care. Standard of care can be fresh frozen plasma for spinal surgery or cryoprecipitate for tumor surgery. Then we measure the blood loss during and after the surgery and compare this to standard of care. The trial has a non-inferiority study design. We had an interim analysis after 120 patients in June of this year, and this confirmed the planned patient numbers, so for us was very positive news. In this first interim analysis, it was really to see if our concept with two indication in this trial is working well.
Now we have another interim analysis planned after we included 80% of the patients in this trial, and this is expected to be in the first quarter 2023. We already recruited 168 of 200 patients. Now, if you say 20%, 80% of this is only 160, but I want to remind you that there are some drop out in the trial and in a setup like this is around 20%. We have also a two-month follow-up for these patients. This is how we end up in the first quarter of next year with this interim analysis. Okay, and then we switch to the third new product out of the Biotest Next Level facility. This was one is trimodulin.
Here I mentioned it already, we started two phase III trials. Both trials are in the setup quite similar, but there are also very important differences, and also the scope of these trials is very different. The first one is the TRICOVID trial, and this is the first one we started. The trial is for COVID-19 patients and the scope of the trial is to be very fast to include most of the patients already this winter. Then during the next year, the trial is supported by a EUR 29 million grant from the Federal Ministry of Education and Research, and we intend here to include 334 subjects.
These are patients on low flow oxygen or high flow oxygen, but non-invasive ventilation and these patients show early signs of inflammation. This is really to be fast on the market in this special COVID setting and as response to the pandemic. Our core indication here where we see also on the long term the big potential of this drug is severe community-acquired pneumonia, and here we started the [Escape] trial. This trial has really a worldwide focus also with many centers in the U.S. We plan to include 480 subjects-590 subjects here. Patients will be on invasive mechanical ventilation and with signs of inflammation with a CRP above 70 mg per liter. All these patients included are SARS-CoV-2 negative.
We switch to our last trial on slide 28. This is the phase III trial with Cytotect to prevent maternal to fetal transmission of cytomegalovirus. Most of you probably have not heard of cytomegalovirus in pregnancy. However, this is very important because it's the most frequent reason for malformation during pregnancy, so even more frequent than, for example, rubella or alcoholism or HIV. There's currently no approved drug for this indication, and this we want to change with this phase III trial. It's an open label, single arm trial, prospective, multicenter, and we use here an historical control group. We currently recruited 22 patients of the 80 patients planned. There's a little disclaimer also, of course, here the recruitment depends a lot on the course of the pandemic.
We saw that with increased hygiene measures like washing hands or using masks, we have less infections with this trial. But overall, I can say it's really great to report to our progress on the R&D side. I hope you enjoyed the short update, and with this, I will hand over again to Michael.
Yeah. Thank you very much, Jörg. Indeed, very exciting to walk through what's going on in our R&D activities here. But of course, you will probably also be interested in the basics of our business. Here we can report that, you know, the demand for our products is still intact, and it's still growing year by year. On page 13, you see that the global IgG market development foresees a 5% increase year by year till the year 2027. The same, even a little bit higher increase, annual increase of 6% year by year. Now, you will see, we see right now, and you will see also in the human albumin market here, this high increase in demand or yearly increasing demand is mainly driven by the Chinese demand for albumin.
Of course, to produce all those wonderful products which are requested by the markets, you need plasma. We have reported over the last 42 months that it's really difficult to collect plasma in the United States. We have seen the COVID impact in the United States rise dramatically in the year 2020 and 2021. It was almost 20% below the pre-COVID plasma collection level in 2019. We can report that the centers in the United States have got up a little bit and are collecting now more and more plasma and getting back to the pre-COVID levels. Those pre-COVID levels we have already reached in our European plasma collection centers. You have probably noticed that over the last months, we have steadily increased the number of centers we own and operate in Europe.
On page 32, you see that in the meantime we have opened 34 centers in Europe, in Germany, Hungary, and in Czech Republic. We are doing that in order to really stabilize the supply of plasma in Europe, collected in Europe. Of course, as you all know, since only four countries in Europe allow the commercialization of the plasma collection on commercial terms, we still are depending on the U.S. plasma supply, the supply of U.S. plasma. Here we have, of course, the advantage of being able to take advantage of the huge network of Grifols U.S. centers in the United States, so that on a long-term basis, you know, also our facility will be filled with U.S. plasma coming from the Grifols centers.
With this overview also on the basis of our business, I would thank you all for the interest in our presentation here and would open now the session for questions and then, of course, answers from our side. Thank you very much.
Thank you very much. Ladies and gentlemen, if you would like to ask a question, please press nine star on your telephone keypad. If you would like to withdraw your question, press nine star again. I'll repeat once again. Please press nine and star to state your question. We have a questioner. It's [Marietta Ninis] of Pareto. Please go ahead.
Yes, good morning, and thank you so much for taking my questions. I actually have quite a few. The first is congratulations on the Yimmugo approval. Can you just talk a little bit about your European rollout plans and sort of the sales ramps you expect? The second question is on your guidance. You set the downside scenario, which is obviously great news, but are you still expecting a loss of no more than EUR 25 million, or could the loss be a little bit higher than that, given that you're already at EUR 19 million at the end of Q3? I mean, to get to the EUR 20 million, which is the upper end of your guidance, you would obviously need to have an absolutely fantastic Q4. Just trying to understand the dynamics there.
I was just wondering if you could give us a brief update on the German energy situation, any risk of production disruption from gas shortages in 2023. Finally, just very briefly on the Cytotect pregnancy trial. I mean, if the pandemic hygiene measures that are currently in place were basically going to stay for the foreseeable future, then what is your best guess as to how long recruitment would take? I mean, are we talking about a year or three years or five years? Just any feel will be really helpful. Thank you.
Okay. Let us start with Yimmugo.
For Yimmugo, the production actually started somewhere second quarter this year in advance of the approval. Now we have the approval. The plan is first of all to switch or to supply the German market for which we just received the approval. We will also, let's say, now subsequently file for all other countries in Europe. I think it also will depend on the production volume being ramped up throughout the remainder of this year and next year. We will basically, let's say, switch market by market in order to make sure that once the market is switched, we can also supply sufficient volumes.
The effect is that, let's say, a number of countries, it will go a bit slower, but in terms of volume, the ramp up will, let's say, be quite significant. Yeah, starting this year already, we want to have, let's say, the first product on the market this year. Yeah, certainly the remainder of next year will be mainly Germany and Austria and some other countries, but maybe, Michael, you can also allude to that.
Yeah. Indeed, what you said, you know, we are starting selling it, of course, right now, next week already, and we expect, you know, sales of Yimmugo this year for the magnitude of EUR 3 million, and then ramping up it also more and more for Germany and other country as well next year. Probably maybe between EUR 30 million and EUR 50 million then in sales volume next year on top of what we have sold this year up to now with our other products.
On the guidance side, Marietta, I'm pretty sure that we won't end up lower than the EUR - 25 million we have seen or we have seen as this lower end of our range in projections of our EBIT level for this year, because you know, we are just five to six weeks away from year-end, and I don't see that any of our big customers will completely fail in the remaining weeks so that we would not be able to collect the money they owe us. Also, if there's some bigger disruption in the world markets, I guess it's only the case if really a force majeure happens above all those things we have seen up to now. Otherwise, we can really exclude that the loss will be bigger than EUR -25 million.
Therefore, I can really exclude this not only worst scenario we have predicted in trend in March 2022 this year, but also say that the EUR -25 million will be really the lowest end of our guidance here for this year. German energy market with regard to 2023, of course, we have contractually secured our gas supply for 2023, but you know that if there's really a gas shortage in Germany declared officially, then even the contractual agreed prices would no longer prevail. For that, I cannot give a complete assurance that we will end up with an overall energy bill here of additional up to now EUR 9 billion-EUR 11 billion.
That's our expectation of additional energy costs for the site here in Dreieich for 2023, reflecting higher gas prices as well as higher power prices, electricity prices in 2023 based on the existing contracts we have. As I said, if there's officially gas shortage declared by the government, those contractual arranged pricing would no longer prevail, and then I can really not give you any idea how big then the negative impact would be on top of that I've just mentioned.
Sir, can you talk?
Yeah.
Yes.
The last topic was Cytotect in pregnancy concerning the timeline. Of course, we see this increased hygiene measure. We now implemented some countermeasures, awareness concerning awareness, but also including new sites. That we want to keep up the speed also in this the trial. I believe that we will switch probably the termination of the trial a little bit. It might be not early 2024, but more late 2024 when we have all patients included, but this is the range. We are not expecting really here many years of delay, but a delay by several months, and we try everything to keep the timeline.
Thank you. Just wanted to follow up on the energy situation. You will definitely be getting all the gas you need. The supply contracts actually say that, you know, you have reserved that contingent and you're going to get it. You're just not quite sure at what price you're going to get it, but Germany cannot say because of a gas shortage, we're just going to reallocate that to private households or whatever.
No, unfortunately, I can't exclude this risk at all. Indeed, as I said, we have for us, you know, secured supply for gas for 2023 and have fixed prices for that. You know, if there's an overall gas shortage declared by the government, then of course, you know, an allocation of gas can happen and the existing prices are no longer valid. You know, if the situation is as it is right now, we are secure. If there will be a gas shortage, official gas shortage next year declared by the government, then, you know, all risks are back again.
Okay. Very clear. Thank you.
Welcome.
We have one more questioner as [Mr. Pascal Elf] of [audio distortion]. Please go ahead.
Hello, Pascal speaking here. Thank you for taking my two questions. The first one is, can you give some information for the factor VIII issue from last year in December and what's the improvements here in 2022? In this case, maybe how is the gross profit margin developing as well? Second one is, how can you ensure that you get enough plasma for the more capacity in Biotest Next Level, especially the plasma from the U.S.? Thank you.
Okay. Thank you very much for the two questions. Indeed, the question for our factor VIII is really valid. If you recall, we have had this one-time write-off in 2021, at the end of 2021, because we have foreseen that the demand for factor VIII, especially for the plasmatic factor VIII, was significantly decreasing over time, and combined with that, also pricing went down. Therefore, we had to write- off some of the inventories we had with regard to factor VIII. We have also said at the time that we would reduce the production of factor VIII in our facility here in Germany. That the amount of factor VIII produced will be in balance with the demand we are seeing in the market.
For the time being, you know, yes, compared to last year, we have lower sales in factor VIII, but we are producing in line with the reduced factor VIII demand in the markets right now. The prices we have seen are at the lower, in the lower range we had seen at the end of 2021. The gross margin out of this business with factor VIII has been, you know, not declined anymore. It's still in the range of 5%-10% for this plasmatic factor VIII. As regards to the plasma supply, especially the U.S. plasma supply, it's indeed a significant challenge for us to secure that because we would need in the end up to 750,000 liters for our BNL facility here in Dreieich to produce for the U.S. market.
We have the promise of Grifols to supply us with such U.S. plasma out of the huge number of plasma centers Grifols owns and operates in the United States. Therefore, I'm pretty confident that even if Biotest has no longer own centers in the United States as we had earlier, in earlier times, we will get enough U.S. plasma from our major shareholder, Grifols.
Okay. Thank you. Just one follow-up maybe on the overall gross margin. What's the overall gross margin for the first nine months?
The overall gross margin for the first nine months was 24%.
20%. Okay. Thank you very much for answering my question.
Welcome.
There are no further questions in the queue, but I will repeat once again, ladies and gentlemen, if you still have a question to state, please press nine star. We have one more questioner. It's Mr. Klaus Schlote of Solventis. Please go ahead.
Guten Morgen, everyone. Good morning to everyone. Thanks for taking my question. What is the situation with regard to ADMA? I saw that you have had some positive effect, I guess, because the price of ADMA went up. Or what is the reason for that? Another question is regarding pension liabilities. They are pretty stable compared to last year, end of last year. I would have expected some reduction because of increased interest rates. Maybe that will happen towards the end of the year then, but you might explain to us, please. Then there was. I will say now in German. What is behind that issue? Exactly, then you get some public money for COVID-19 in regard to trimodulin.
You have received already EUR 8.8 million. I don't know whether it's we received, but you have some earnings effect from that, some positive. What about the rest of the money? Or when will that flow and when will be the earnings effect and when will the money flow? Thank you.
Yeah. Thank you, Mr. Schlote, for those questions. Let me start with the last one. Jörg should have mentioned already that we got a grant of in total EUR 29 million for conducting this phase III study with COVID patients. It's of course a more complicated formula saying that based on milestone developments, we get 80% of our expenses reimbursed. We have, as you rightly said, already received EUR 8.8 million this year, and the remaining EUR 20 million are then depending on the further progress of the phase III study. You know, over the next two years, you know, if we see the progress with the study, then the remaining EUR 20 million will be being paid by the government as reimbursement of those phase III studies.
No further positive effect this year, only then starting next year?
Maybe in the last three months, you see another EUR 1 million or something like that.
Okay.
That's it.
Okay.
Okay. With regard to this, difficult to explain. That's just a write-off of, you know, you have to look at the risk profile of different countries. Here we had a write-off on Turkish invoice claims in that amount. Pension reduction, to be honest, I rather foresee an increase in our pension reserves due to increased interest rates. You should expect just the opposite, but it's probably a minor issue till year-end. With regard to ADMA shares, you may recall that we had been forced by CFIUS, the Committee on Foreign Investment in the United States, to get rid of all our U.S. assets, including at that time, the ADMA shares.
They are still owned and hold by a trustee, and we have, of course, the claim of getting the money if the trustee sells off those shares. As long as he owns the shares, you know, the value of this claim is, of course, based on the actual share price of ADMA. You have seen that the ADMA share price, you know, went down to $1.5 per share, and now it's, as of just this morning, about $3 per share. This increase is also shown in our numbers. The claim we have against this trustee has gone up value-wise because the value of ADMA shares has gone up over the last nine months.
I might add in a follow-up question with regard to pension liabilities. Can you tell us the interest rate you used for discounting end of last year and end of September this year, please?
No. Actually, I should not recall the actual numbers, but we can provide you with that.
Okay. Okay.
Give Monika a call, you know, tomorrow, and then you can have it.
Okay. Yes. Thank you very much.
Welcome.
There are no further questions in the queue. I hand over back to the company.
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