Good afternoon all, and a warm welcome to Nanoform's fourth quarter and full year 2022 report presentation. My name is Henri von Haartman. I'm your director of investor relations. Today our CEO, Edward Hæggström, CFO Albert Hæggström, and Chief Commercial Officer Christian Jones will present to you. This presentation is webcasted through Financial Hearings, and there's also the possibility to call in and listen by phone. The presentation slides are shown here throughout the webcast, and they can also be found on our webpage under the Investors sections. Now, after the presentation, we will hold a Q&A, and it's possible to ask questions by calling in. Today, we will start with a short introduction to Nanoform, then CEO review, then commercial aspects, and then financial aspects. Operator, well, actually we can move the slides ourselves, so I will move to slide number 3.
With these words, our CEO, Edward Hæggström, please go ahead.
Thank you, Henri. Welcome also on my behalf. Next slide, please. Nanoform is a technology platform company residing in Helsinki, approximately 150 employees. Does GMP manufacturing, has two different technologies, and we're going to talk about both. Listed on Nasdaq First North Premier, both in Helsinki and in Stockholm. Next slide, please. We're addressing a very big problem in a very big industry. Here you can see that a lot of money is being spent, and even though not enough medicines are coming out. We can see that 2022 was a less good year than the years before. Next slide, please. We're addressing the main reason for why there are so few new medicines on the market. That's poor bioavailability. It means that a potent API is not taken up by the body.
API stands for active pharmaceutical ingredient, the part in the medicine that actually makes you feel better. Next, please. This we do by nanoforming, which means that we take in coarse powder owned by our clients, and we make it fine. The reason is then we improve the bioavailability by increasing the specific surface area. Next, please. The process we use is patented. It's a green process. It's called Controlled Expansion of Supercritical Solutions, CESS. Here you can see an outline for how it works. Next, please. When we nanoform, a lot of good stuff happens in a cascade. We increase the bioavailability. New drugs can come to market. We can reduce the dose and potentially reduce the side effects. This means that our clients can have a patent prolongation and a widening on the patent protection.
It also means that as more of the drug is taken up by the body, less needs to be produced, manufactured, and shipped. This of course means that the buyer burden also, both in the local environment and globally, can go down. Next, please. On the small molecules that we spoke about before, we address the bioavailability. On the large molecules where we can also add value, there are many things we can do, but here I would like to underscore two that our clients and partners recently have been very interested in. To enhance the drug loading capacity in formulations, and to tailor release profiles. The first means basically that the pill contains more drug, or the bolus contains things more drug, or the implant contains more drug. The second one means that the drug released is different. For instance, it happens during a longer time.
Next slide, please. Here we present schematics of the biologics process. Basically, we have a nebulization step, we have a complicated evaporation step, where we basically control how the nebulized mist is dried. We have an ionization step. Then we have a collection step. This is also a process that we have filed for patent protection. Right now we are pending in United States. Otherwise, we are in PCT. Next, please. When it comes to where are the profit pools for Nanoform, there are basically three. To give unsuccessful drug candidates second chance, to improve existing drugs, and to enable new drugs. Next, please. Here is a slide that basically shows what we're doing. We work with global large pharma, with midsize and specialty pharma, and with biotechs.
We take in bulk API, and we nanoform it to make it into fine powder. Basically, we always get paid. There is either a fixed fee for a project, or we get paid for making a certain amount of material, or we get paid as a royalty based on how much we provide for P4 that is under mark. Next slide, please. Now I come into the CEO review. The CEO review will really be about holding the course in an environment that has a lot of impactors. COVID, Ukraine war, change in the cost of money. I will show you that while there has been a reduction in our momentum in H2, towards the end of the year, we have been able to get that momentum back. This means that I will be confident in giving you guidance for 2023. Let's move on, please.
First of all, I'm happy to announce Antonio Da Silva as our new Chief of Business Operations. Here you can see that I have underscored in green the fact that we in the organization now have more than 100 years, sorry, 100 accumulated pharma product launches. Reason why I underscore this is as we have matured, this part of our organization has become increasingly important. Next slide, please. During the last two years, we have done a lot of stuff, but it can be summarized by saying we have put the machine in place, we have put the processes in place, and now it's time to start to use it for the benefit of our patients and our clients. Next slide, please. Here we can see a picture of a unique asset. This is GMP 2. It's automated.
It can make smaller nanoparticles than anybody else. It can work on 30 nanograms per meter cube. This here is what we work on. We have 3 GMP assets, GMP 1, 2, and 3. Next slide, please. Here you can see our business targets for 2022. We were able to fulfill number 1 and number 2. We fell slightly short on number 3 and number 4. Next, please. Based on the idea that we have been able to revert the momentum on the intake of the GMP project, I'm happy to pronounce the ones for 2023. An increased number of non-GMP and GMP projects signed in 2023 versus 2022. An improved operating free cash flow in 2023 versus 2022.
These two things are necessary in order to put us on a solid trajectory towards cash flow positivity in 2025. Next slide, please. Here you can see our 2025 targets. I think all of them are still valid. I think we are maybe a little bit on the lower side in the employee. We're a little bit on the lower side in the lines, and the reason is that we have been able to squeeze out more productivity from our engine already now. On the gross margin, I see no reason why we can't fulfill that, and also on the number of APIs and projects per year. Last year, we showed for the first time that we could handle five projects on one line in a year, and this means that we're solidly on track for that.
The final or fifth balloon, the cash flow positivity I already mentioned. This requires both that we keep our costs flat and that we grow our top line. We will talk more about that today. Next slide, please. With this, I hand over to Christian.
Thank you, Edward Hæggström. Welcome to the commercial presentation from Nanoform today. If we can move to the next slide. As you can see, the global drug R&D pipeline is only going in one direction, and the latest stats from 2023 estimate that there are 21,000 drugs in development. Despite the macroeconomic environment that we are in, this trend is only increasing. If we look at the next slide, we can see that there is also a significant increase in the number of companies that are working to develop these molecules. Of course, it's a challenging time for many of the smaller biotech companies, but there is still a huge demand to develop new drugs, and we only see that again going in one direction.
If we look at the revenue drivers and the industry attrition rates, it's quite interesting. We have a major pharma productivity issue. As Edward alluded to earlier, we're spending a huge proportion of investment in the pharma industry, and that's typically not coming back in terms of the, the output that we're seeing. Basically this slide says two things. It says that to develop a new drug, it takes 9-13 years, and to develop an existing drug, to make it into an improved product, for example, like a 505(b)(2) pathway, it takes approximately 6 years.
Our customer portfolio is a mixed Mixture of both, the innovator, the large pharma and the small biotech, for developing NCEs, and also those companies in the specialty pharma space, or those big pharma companies that are interested in doing life cycle extension or looking at a 505(b)(2) pathway. Ultimately, we derive value out of every part of our relationship with our partners, through every stage of their journey. We are paid for all of our activities. If we move to the next slide. I think this slide is our, this is our business model, but I'd like to just sort of talk you through this and to re-emphasize something. Our business model has stood the test of time. We initiated this business model in 2019.
When I joined the business then, we talked about what was the appropriate model for growth of Nanoform. This model is still relevant, and still appropriate for our business going forward. We get paid to evaluate the compounds that come in from our partners, to see whether our technology can add value, whether we can make nanoparticles and how they could be, prove value in biology. We get paid to do that. Then we take the molecule through into clinical manufacture. Again, we get paid to deliver material to a clinical specification for our partners' projects. Then drugs on the market. We don't yet have a drug on the market, but we hope to be there soon.
When we are there, we will be paid for commercial supply of our product and also a royalty on the net sales. That royalty will depend on the value that our technology contributes, anywhere between a 1%-20% range. Throughout all these steps in POC or non-GMP, we charge our clients anywhere between EUR 50,000-EUR 500,000, depending on the scope of the project. In the phase 1-3 trials, anywhere between half a million EUR to EUR 10 million for supply of clinical material. Let's move to the next slide. This is an image representing the commercial team. I would say small but powerful, but in fact, it's growing ever larger.
We now have 11 of us in the team, and we spent a good proportion of last year investing in our people and expanding our team. We expanded that by 40%. In order to get the results that we want to get, we have to have the right people in place and the right processes in place. As you can see from this slide, we have people that are very experienced, both in the United States and in Europe, that represent the Nanoform business. We also have experienced BD professionals that are out networking, trying to build relationships with the customers.
We're building a lead generation team, with an insight-driven intelligence angle to understand where we should be, which doors we should be knocking on with which pharma companies, to have which types of conversations, and who should we be talking to behind those doors. That's a very powerful business intelligence angle that we bring to our commercial activities. As we move to the next slide, I'd like to highlight the commercial milestones from 2022. I think the first one would be the relationship with AstraZeneca.
We mentioned in our financial reports last year that they had concluded a positive technology assessment through a very thorough and diligent assessment of our CESS technology, and that they had moved forward into identification and implementation stage for clinical assets to use with our technology. A very positive announcement after a very thorough review from AZ. Secondly, I think, you know, another sign of our business maturity and our commercial relationships maturing was the collaboration on the blockbuster product. We signed commercial terms, and we have the project now in GMP manufacture, and that's planned to go into clinic later this year. TargTex, our Portuguese biotech partner, we have positive in vivo data for GBM, for glioblastoma multiforme.
This was a major announcement last year, something we were very proud to be part of, and to be able to provide hope for patients with this horrendous disease. You know, our technology can add value in all sorts of different ways to products. Sometimes it's just about making something more convenient, taking a few pills and making it to a single pill. That can be beneficial for patients. Sometimes it's truly transformational, and that's in a project like TargTex, where potentially it could be life extending or even life saving. We talked about the commercial team expansion. We have been optimizing our back office and front office activities to make sure that what we do behind the scenes, we're ready to onboard a large volume of the customer projects in the most effective way.
At the same time, in the terms of the front office, we're able to bring in that large volume of projects and make sure that we bring the right ones in for the business. Last year saw 18 new projects and 12 new customers. I think this in itself is an interesting statistic that should be discussed. It's not 12 new customers with 12 single projects. It's a mixture. Some brought in single projects, some of those projects came from repeat clients, and some of those projects came on board with one client bringing more than one molecule. I think this is very interesting because the repeat business is a real indicator of the value that partners see in our technology.
We're having, you know, quite a few companies now wanting to either extend the scope of their project or to bring on board another molecule, and that can only be testimony to the relationships that we're building with those parties. The other aspect is people's really seeing the value in the technology and bringing on more than one molecule with Nanoform. I think on both counts, very, very promising. Our customer satisfaction levels increased last year. We've been monitoring them over the last 3 years, and they've been increasing year on year. We're very pleased to see that, and we only want it to go, keep going in that direction. We place a lot of value in the relationships that we build with our partners because ultimately we see ourselves as an extension of their team.
Importantly, last year also saw our first customer referral, where one of our partners actually referred our technology to another customer where they saw that the technology could add value. Towards the end of last year, we saw a new quarterly record in customer meetings and proposals sent, and I'll talk more about that on the next slides. As you can see here, we have the number of projects and the target this year is to sign more projects than we signed last year. If you look to the left, annually and cumulatively, you can see the growth in the number of non-GMP projects, and between 2021 and 2022, we had a similar number.
Of course, we would have liked to have delivered more projects and signed more projects last year, but due to, you know, a number of factors, I think the markets, environment, the macroeconomic effects, we didn't sign as many as we would have liked to, but we were very, very active from a commercial perspective and very engaged. I think we will see the fruits of that activity and that labor coming into force in this year. If we look at the right-hand graph, you can see that we landed 8 projects in Q1, 5 in Q2, and then 2 and 2 in Q3 and Q4. Yes, we're disappointed with that result. Let's go to the next slide because I think this tells a different story. The number of active opportunities has been steadily increasing.
I'd like to cast your eye across to the right-hand graph, where you see the number of proposals that were sent per quarter. From Q1 to Q2 and Q3, it's quite flat, it almost doubles and picks up up to 23 proposals issued in Q4. I think this was a function of the change in sentiment in the market towards the end of last year compared to earlier in the year. It's also a function of a lot of large pharma companies freeing up their travel restrictions and attending conferences.
I think the last quarter of the year is always a busy period, but in particular last year with conferences in the US and in Europe, we saw huge engagement from major pharma at these events and also from the general biotech and mid-sized pharma community. We look positively towards 2023 with the level of momentum that we have built up. As with all these things, there is always a lag in the time of activity, proposals going out to being seen, orders being signed. If we move to the next slide, I put this slide in really to provide a visual on, you know, how fast are we? Are we fast enough from a commercial perspective?
When we started off, you know, we were really trying to sell Nanoform as a company, you know, trying to raise the flag so people would understand who we are within the marketplace and have some level of credibility. Well, we're not there anymore. Certainly people are aware of who we are. I think we've seen an interesting change in the dynamic of our customers, where we had those first to adopt companies from an innovation perspective, the likes of AstraZeneca that came on board early in our growth. We had companies that followed were sort of first to follow, the likes of Boehringer Ingelheim and others that we've mentioned, in the, in the sort of preceding time. Now I think we're getting perhaps establishing relationships with some of the more conservative, major pharma organizations.
This is an interesting aspect. What we can see here is that from last year to this year, there's really not been much change in the amount of time it takes from lead to contract execution. I think we're getting to an optimum here. Could it be better? Possibly. I think we're building up a large sales pipeline to be able to bring in many, many opportunities, and we're putting the right resources in the right places. You'll notice that there are some outliers here, the likes over 500 days recently. Ultimately, that's most of those large numbers come from large pharma companies. Not all of them, but most of them. As I said, sometimes we have to bang the door many times before we eventually get our partners to sign.
The smaller numbers can come from two different things. Either a small biotech or a major pharma that has a, you know, an absolute burning platform of the burning need that needs to be solved. Or as we're starting to see repeat customers. Where we've gone in, gone into the relationship, it's taken time to put in place the contracts. Once the contracts are in place, repeat business is fairly straightforward to implement. I'll move to the next slide. This is really a snapshot of our customer relationships to date. We've engaged with seven major pharma companies. We have 24 mid-sized specialty pharma and biotech companies, including the likes of Pharmanovia, a Triton-owned company; Herantis, a company based in Finland; and TargTex, our Portuguese biotech partner. We've got three collaborations ongoing. Aprecia and Celanese are two, both based in the U.S.
We have 1 co-development. This is on the Blockbuster drug. Last year, we saw 12 new clients and 2 new in Q4 2022. I'd like to finish on small is green. The environmental impact of pharmaceutical manufacturing can be considered the same as the output of a small country. The pharma industry is heavily pressured to improve its ESG rating, to invest in technologies and manufacturing footprint that can improve their green rating. As such, major pharma, particularly 80%-90% of their carbon footprint comes from their supply chain. It comes from the APIs that are manufactured and the drug products and the logistics. There is a big trend towards onshoring of manufacturing as well from the East back to the West.
Our technology actually plays very well into this space. Both technologies, both small molecule and large, are green. They're free of organic solvents. The CESS process utilizes a clinical-grade recycled carbon dioxide. It's actually produced as a side product from road salt production, so it has a really big green stamp in that regard. We also operate STARMAP, which is the digital twin of our CESS process, and this eliminates time and unwanted experiments for our partners. We can quickly pick the winners to improve the return on investment for them and the green angle in terms of the experimentation that's saved. We ultimately aim to reduce global waste at point of administration by developing patient-centric formulations and medicines. That means that by having a better bioavailability, we can reduce those drugs that are gonna be excreted to the environment.
By enhancing bioavailability, we also see a big impact in opportunity to reduce dose, to reduce production volumes, logistics, carbon footprint and manufacture, and support the rise of onshoring in pharmaceutical production. Our goal is to add value for patients. That's why we believe that small is powerful, both for patients and for the planet. Thank you for your time. Arppe, over to you.
Thank you, Christian. Let's go over to the financials. If we start to the left, we ended the year with 150 employees. We added 25 during the year. In 2023, we do not expect to add to our headcount as we focus on productivity, efficiency, automation and cash flow. The same goes with number of lines. As Edvard Hæggström mentioned, we did already five customer project on one non-GMP line. That means that as we today have roughly 20 lines, we can focus on doing more projects per line rather than building new lines. Also here we focus on cash flow and productivity and efficiency. When we look at the number of projects generating revenue, last year we had 35 projects. The year before we had 22.
On the right-hand side, if you see revenue generating projects per quarter, you can see that we reached a plateau of roughly 23 per quarter that were generating revenues. If we look at the books revenues, left-hand side, the rolling 12 months figure went to EUR 3.5 million, up from EUR 2 million last year, and we had a new high of quarterly revenue of almost EUR 1 million. A few points on the Q4. The fourth quarter had a bigger amount of material and services costs above the gross margin because we ramped up the GMP for the coming GMP delivery in that is planned for Q2. That of course had a small impact on the gross margin that was 82% that you can see from this slide.
In Q4, the annual number was 90%. We see this as temporary, but we believe that in 2023 we will go back to the sort of normal levels. We have now also, of course, the tank, the 40 cubic meter tank that has been hooked up to all the lines. If you look at the IT expenses, as you know, we implemented SAP during 2022. We went live on schedule and basically on budget the beginning of January. We are very happy with that. Implementing SAP is always a big project, but here you can also see that the most extensive cost and work is done prior to the launch, and therefore, in 2022, the IT costs will come down significantly from last year. Here are two numbers.
On the left-hand side, total number of employees. On the right-hand side, number of projects per line per year. They are both going in the right direction. We want to add automation. That means that having less people per line, doing it more automatically, also keeping the personnel costs in line. On the right-hand side, we want to increase the number of projects per line. As we said before, we are targeting five projects per line per year. What we have learned during 2022 is very important. Three things. First of all, we have done it on one of the lines on non-GMP side. That means that, we know it can be done for the whole fleet, probably.
Secondly, we have learned on the biologics side that most likely we will be able to do even more projects per line per year on the biologics side. That means all in all, we will probably not be needing to build as many lines as previously thought and still being able to do all the projects we plan. If you finally go to the operating free cash flow, here we have the target to have an improved operating free cash flow in 2023 versus 2022. Here you can see that we have invested heavily during the last years, in 2023 we will expect to see a clear trend shift here. We expect all the factors impacting the cash flow positiveness or the operating free cash flow to start to work in our favor.
The fact that we despite some increases in average salaries, we still expect rather flat costs in 2023 versus 2022, and we expect a lower CapEx. We also have a very strong balance sheet with EUR 68 million in cash, and instead of paying some small sums to ECB for keeping them, we instead get return on the capital in the form of interest, now with the interests going up. That was the last slide I thought of talking about, so I think we can go now to Q&A.
If you wish to ask a question, please dial star five on your telephone keypad to enter the queue. If you wish to withdraw your question, please dial star five again on your telephone keypad. There are no more questions from the telephone conference at this time, so I hand the conference back to the speakers for any closing comments. Please state your name and company. Please go ahead.
Hi guys, this is Christian Golsby from Stifel. Can you hear me?
Yes.
Okay. I think we've got a slightly odd automated process here. Okay. Kicking off then with the, I guess the focus, potentially for this year on the GMP program, the blockbuster GMP program, you talked about delivering this year. Just worth a reminder in terms of what you've are able to say about that product in terms of therapeutic area, what the objective is of the Nanoform formulation in terms of, you know, as a different mechanism, a different route of delivery, and in time will we actually, you know, be able to know who the partners are and what the product is?
If I take the question first, and then I will need to have a little bit help from Albert in order to know where the boundaries are, what I can say. I start from the end of your question. Yes, you will be able to know a lot immediately when we can say so. You will also be able to track the progress via the official databases that we of course will be visible in. When it comes to the size, the blockbuster is a size and it's one of the big indications. I don't remember exactly what we're allowed to say on the asset, so maybe Albert can help on that.
When it comes to the time, I think we softly were saying that, Q2 is when we expect that we will be.
The shipping material for this program, and then, I also think we have been saying that we have applied for upgrading the site to a multi-API site, which of course will be necessary for this. We don't foresee any problems with that either. Maybe Albertin, if you can help me with the other parts of the question, please.
I mean, we haven't set the indication, but we have said that it's a blockbuster above EUR 1 billion a year. As you know, we started with 1 partner, then the consortium grew into 3 partners. Now we say that we plan to start order shipping in the second quarter. We have also said that originally we said that the deal was a seven-figure deal, low seven-figure deal. Here, we have also said that when it comes to the financials, we have entered a deal where we have equal shares, meaning that Nanoform can expect a 25% share of the net income received by the parties.
Okay, that's helpful. If I can maybe a quick follow-up on that then. Is it maybe we'll have to wait, but is it possible to say yet whether that trial, assuming it sort of starts in the second half of the year, is that likely to be sort of one trial, or is this likely to be a step process, one followed by another?
I think that that's a very good question. To the best of my understanding, there will be one trial first, and then I would presume that there may be another trial after that. I speak a little bit softly on that because I don't have full insight into that topic.
Yeah. I think.
Yeah.
It's Christian here. I don't think we provide guidance on that, Christian.
Yeah. No, that's fine. Understand. Then on maybe for Christian then, in terms of the obviously it's the uptick in proposals, maybe just to give a sense for, you know, how you're sitting at this, at this point in time, as you look to deliver those contracts this year. How many live proposals are out there today and what is your typical conversion ratio over that? You've said it's sort of 4-5 months, but what's the conversion ratio?
I don't think we can provide information about our Q one status when we're talking about our Q four report. What I can say is that typically our conversion rate is higher than the industry standard in the CDMO space. I think, you know, typically you would expect for new business with new partners to be in the 20%-25% range for winning contracts. Some of the better companies, probably slightly higher. With Nanoform, we're typically in the 25%-30% range with new clients. We're trending above the industry average. I think when it's repeat business with existing clients, we also have an even better score than that. I think they're good.
They're some of the good numbers. You know, the whole focus now is to broaden and deepen the sales, the size of the pipeline, so that we can bring in more leads, in order to get to our position, that we need to be by the end of the year.
Okay. Thank you. Finally, if I can, just, yeah, any further updates or what we should be expecting on the biologics side as it relates to potential GMP, you know, the actual process for getting formal approval for a GMP line, and any biologics GMP work that might be possible in 2023?
Thanks. That's a great question, and I'll try to answer the different parts of it. First, if we start, I think that the biologics part has picked up now. It's clear that people have warmed to the thought that small is powerful also in biologics. We look forward to being able to give you names as soon as our clients and partners allow us to do so. I mentioned that there are now being a focusing on the questions that come in according to the two balloons. Then maybe thirdly, I think it's important to say that the GMP pilot that we have built, it's basically a line that can be converted for full-scale biologic GMP.
It will need a clean room around it. We have already shown that we can do those. It will need a GMP QMS. Well, we have one in place already. It will need stamps from EMA. We have shown already that we are able to also get those. I think that immediately when we see that the business need is there, we will be able to fairly fast convert it into a full-fledged GMP line.
Okay. Thank you. Thanks, guys.
Thank you.
As a reminder, if you wish to ask a question, please dial star five on your telephone keypad. The next question comes from Lars Hevreng from Danske Bank. Please go ahead.
Yeah, thanks. on the ongoing capacity expansion, you mentioned the GMP line 3 due for completion around the next quarter. What can you say about the planning for GMP line 4 and onwards?
Yes. GMP 2, 3 will of course be part of this inspection that I talked about a little bit earlier. GMP 4, we have decided that we want to fill up the capacity on GMP 1, 2, and 3, before we move into advancing GMP number 4. The idea of GMP number 4 will be similar to the ones we have, which means that we will incorporate the new things we have learned, and then we will try to make an incremental when it comes to all other things. The idea is to have as few changes as we can and then incorporate the learnings we have in the sort of process stability on GMP number 4. First, we fill up number GMP 1 and 2 and 3.
One comment is that remember that on the GMP on the biologics side, the line is much smaller. It takes up a few square meters, and it can be faster built than on the CESS side. If you think of it took roughly 18 months for the on the CESS side to build the lines. Now we know better, we can copy-paste, so we could be faster of going, potentially being able to do it in 1 year. On the biologic side, it can be even faster because the lines are much smaller than on the CESS side.
Okay, thanks. The status on your plans regarding establishing a site in the U.S., what's the status there again?
I'm happy to talk about that. Together with Gonzalo, we have been working tightly with Colliers. On their recommendation, we have not narrowed down the number of states in the game, so we are at four states that we pit against each other. As I have said before, we have already spoken to one of the governors, and now we're lining up to speak to the second one. On the tactical level, we have identified in each of these states, sites and buildings that are potentially okay to us. The idea is that we will take a solution from Viikki, copy-paste it, and then have it slid in plug-and-play into the American scaffold/infrastructure. That means that we can have something that we know will work.
When it then comes to timing, it's clear that we want to synchronize the build and the demand of the business in America with the investment profile there. Right now we are looking at hopefully getting the markets to cool down a little bit when it comes to the leases. Albert can talk to you a little bit about the money if he wants. From my perspective, we continue to prepare, and when the timing is right, we strike. By doing this, plug-and-play, we're able to still hold on to our December 2025 GMP particles in America target. Albert, do you want to say something else?
Yeah. I think when you look at the statistics, for example, one of the biggest markets there, the expectancy is that if all the projects that are planned come online, you will have 50% more space available in the coming 2 years. What we have also seen is that the market pricing has not yet reacted. We are also seeing that some companies are trying to get rid of their leased space. The momentum, because of the fast increases in the interest rates during the last year, is clearly down. That means that if we want to sign a 10-year lease for a facility in the U.S., we are not in a hurry to do it from a price point of view.
We want to make sure that the market prices have reacted to the new normal and are not still on the sort of zero interest rates levels. Also, we want to find the right place. It's clear that there is lots of available capacity that is increasing in the coming quarters. We want to be a little bit opportunistic also, but of course, we are doing a thorough planning and we have already quite a few potential targets. We are still a little bit cautious on the cost level.
Okay, thank you. Regarding the coming back to the collaboration with TargTex, are there any milestones involved in that collaboration, milestones for you in terms of reaching new stages of development or anything similar?
The answer is that, again, I will need a little bit help on exactly where the boundaries go, but we have basically very clearly that we will need to manufacture certain amount of GMP material for them. My best understanding is that this will happen rather towards the end of 2023, 2024. We know that we will be able to do so. I also think that it's fair to say that they have reached out to get preliminary sort of guidance from the big American agency. This is to me also an important step. It means that Nanoform will now show up on their radar. Anything Albert or Christian wants to add to this?
No, I think you highlighted the relevant points, Edward.
Okay. Thank you.
There are no more questions at this time. I hand the conference back to the speakers for any closing comments.
Thank you, operator. On behalf of Nanoform, I would like to thank you all for participating today, and thank you for the questions. If somebody has more questions, you're always welcome to contact us later. You will find our details on the web. Hereby, we wish everybody a great Tuesday afternoon and evening, and you will all have the possibility to see us in the near future on the various conferences that we are showing on the slide here. Thank you for today, and goodbye.