Hello. Welcome to this Q2 presentation with Curasight. With us today, we have the CEO and the CSO and co-founder. First, there will be a presentation. 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 Curasight to start the presentation. Ulrich and Andreas, your lines are now open.
Thank you, Anders. Thank you for the introduction. Thank you for having us here today in order that we can present the interim report for the first half of 2024. Also give you an update on the business going on and the strategy and funding. We have prepared a small presentation. Just a disclaimer. What we will touch today is the financial figures. We will touch the highlights for the Q2. Andreas will give a touch on the company strategy for 2024 and also into 2025. I will give an update on the funding structure and also explain why it is structured as it is. We can accept the Q&A session afterwards. I will only touch the figures for the first half year, meaning from the 1st of January to the 3rd of June.
We had a gross loss amounted up to -16.4 million DKK, compared to 13.6 DKK last year. The variation is mainly due to increased development activities. The operating loss amounted to 20.4 DKK compared to 16.8 DKK, and this includes wages and also depreciations. The loss before tax, which includes also financial costs, sums up to around 21 million DKK compared to 16.8 DKK last year. The loss for the period, including the tax calculation, sums up to -18.7 million DKK compared to 13.1 DKK last year. If you look at the total assets, it sums up to around 28.9 million DKK compared to 46.3 million DKK last year. The variation is mainly due to the cash position compared to last year, which means that by the end of June this year, we have 8.3 million DKK compared to 32.1 million DKK last year. The equity ratio also compared to 96% last year.
That is also due to the change of the balance in general. That is all I would say about the financial figures. If you look at the highlights for Q2, we were able to announce already in April that we have got approval for the clinical trial application from EMA, the European Medicines Agency, that we got approval to conduct the phase II trial in prostate cancer based on uTRACE, which is comprised of the partnership agreement with Curium. Also in the mid of June, 12th of June, we were able to enroll and announce that the first patient in this trial, which also triggered the second milestone payment from Curium, which sums up to a half a million US dollar. Also in June, we announced additional funding structure.
I will come back to that, also that, in general, it comprised, first of all, a directed issue, a loan facility, also preferential right issue of units to existing shareholders. If all the ones are also utilized, it will potentially give us new funding up to DKK 120 million, which will cover most of 2025 also with the plan we have right now. This has also to be approved by extra general meeting in the 2nd of July, where we were authorized the board of directors to issue the new warrants. That is very briefly about the highlights. I will hand over to Andreas Kjær, who will give a touch on the company strategy.
Thank you, Ulrich Krasilnikoff, also thank you for having us today. I will just take you short through what it's all about. The technology we are working on is based on the principle of targeted radionuclide therapy. In short, the principle is to deliver radiation therapy by a compound that is injected, seeks out the cancer, and irradiates locally instead of irradiating from the outside. This carries several advantages. It's less toxic because it does not shoot through healthy tissue, it can also be used for widespread disease. If a patient has a very widespread disease metastasized to all organs, there's no way you can apply external radiation therapy that would kill the patient. With targeted radionuclide therapy, that is possible.
You even treat the micro-metastases that are so small that you did not know they are there because it seeks out all the cancer cells that expresses the target. We really believe this is the future of concept for radiotherapy of tomorrow. On the next slide. Our specific technology targets the cancer receptor uPAR, which is highly expressed on cancer and actually on almost all cancers. This technology does not only work in one cancer type, but basically across solid tumors. The peptide, the small molecule that binds to uPAR, is then armed with radioactivity, and it comes in two versions, either with harmless radiation, radioactivity that can be used for PET scan. That is what is shown on the left, and we call it uTRACE because it traces, it visualizes the cancer. In a more harmful version, where the radioactivity is emitting radiation therapy, that is what we call uTREAT.
The nice thing with these two compounds is that they behave exactly the same regarding binding. What you see is what you treat. When we do the scan and we see that uTRACE gets into the tumor and sits there, we can exactly predict where the therapy goes. In this way, you can be sure that you are not treating patient that will have no benefit, if you have a high uptake, you also know you will have a high radiation dose. This is just another way to demonstrate our platform. It's uPAR theranostic means therapy and diagnostics. It's these two compounds that binds one to one, therefore you can use uTRACE to produce uTREAT.
On top of that, we can actually use uTRACE as a standalone compound. I come back to that. The interesting thing by making this new and more gentle type of radiation therapy is that radiation therapy is really a pillar, a backbone of all cancer therapy. Worldwide, 50%, and it's actually almost 60% of all cancer patients, and we are not only talking in Western world, but worldwide, will get radiation therapy sometime during the course of their treatment. It's here to stay. We know it's effective, and there's in essence no way you are resistant to radiation therapy. By replacing the common traditional radiation therapy by the more gentle method of targeted radionuclide therapy, we already know that there's an immense number of patients that can benefit from it.
If you, on top of that, put the patients that today will not be eligible for traditional radiation therapy, those were the patient with very widespread disease. Because the concept is that it seeks out with precision the cancer cells with the injected way to do it, they can also be treated. Maybe it's close to 70% of all cancer patients that will eventually receive targeted radionuclide therapy. To go back to specifically how we strategically position our two compounds. If we start out with uTREAT, the therapeutic option, we have for a long time talked about the basket study. You see that at the bottom. Why do we do a basket study? This is to take advantage that our technology works across solid tumors.
You should be aware of that the compounds out there approved already, Pluvicto and Lutathera, both of them goes for a target only expressed on a single cancer, which means they cannot be broadened out. They are tied to the target that is specific for a cancer. We have a target that is cancer specific, but not cancer type specific, and therefore we want to take advantage of testing our technology across solid tumors. This immensely increases the likelihood of partnering with different pharmaceutical companies because we will have shown efficacy, hopefully in different cancers. However, this is a larger study, more costly study, and we expect the first patient to be dosed in Q3 2026.
To compensate for a larger study that takes longer to prepare, we have decided that we will go for a single indication where we hope to dose the first patient Q2 2025 to demonstrate the proof of concept. Although only in one cancer indication, that would show the concept and then everybody knows that uPAR is expressed across cancer types and can kind of extrapolate in their minds that it probably will also work in other cancer type. This is the reason for having a single indication, first indication in a basket study. Yes. If we go to uTRACE, which is the imaging ligand, then of course it's going to be used as a companion to our therapeutic studies. We check patients whether they have uptake of uTRACE and therefore will enter into the therapeutic study.
On top of that, uTRACE, because uPAR is aggressiveness marker, is very, very good in all indications we have looked at across cancers. It shows the prognosis, the expected survival of patients, how aggressive is the cancer. This is why we partnered with Curium in prostate cancer, where uTRACE is explored and studies are ongoing to position it for being a non-invasive biopsy. The majority of prostate cancers are relatively benign, but you want to be able to predict those patients that have aggressive cancer or where the cancer turns into a more aggressive form. You also want to be sure that you don't over-diagnose or over-treat. We want to follow people, and the majority will never have aggressive treatment, only if they have a higher uptake of uTRACE.
This is the project we run with Curium, and I come back to that on the timeline, how far we are. Then you can see in the bottom that we have investigator-initiated trial across almost any solid tumor. In all these, we have more or less shown the same very prognostic readout. Nuclear medicine, we have been working for many years, and many of you are probably also been on board for many years as investors. We were out early with this concept of targeted radionuclide therapy, but there had been what we would call a catch-up effect. Suddenly, big pharma is looking for assets within the radiopharmaceutical space. We believe all these companies now have realized the same, as I just told you, this will more or less replace radiation therapy. This will be the new concept.
Every month there are large transactions where big pharma buys into companies like Curasight that have specialized in this form of therapy. We believe we have good traction, but also the environment gets more and more positive and more and more understanding towards the concept. If we then look into the milestones, this is a little bit a repetition of the pipeline diagrams we showed you. If we start with the yellow part on the top, that's our collaborative project with Curium, prostate cancer biopsy to follow patients. Remember, a lot of patients suffer from prostate cancer. It's the most common male cancer. Before summer, we included the first patient in part one of this study and expect to end in Q4 part one and have the preliminary efficacy data readout.
This will then be, as you can see if you look to the bottom, just before exercise period of the first series of warrants. Hopefully that will be positive data that can support that they will be exercised. If we then look on uTREAT in a single indication, in the first indication that will show proof of concept, we expect approval from the authorities for the clinical trial in Q1 next year, and then to dose the first patient in Q2, and that will be just before exercise of the second series of warrants. Finally, you can see in green the uTREAT basket trial that will then hopefully include the first patient in Q3 2026. This is how we see it and also how it's aligned with financing and funding that Ulrich will talk more about in a moment.
Thank you, Andreas. I will give you an update on the funding structure that which we announced in the end of June, the elements about that. The transaction potential ensures us up to DKK 120 million, and we still maintain the strategic flexibility also to onboard larger investors. If all the warrants also are executed, then we will have funding to the rest of 2025 also, as the plan is right now. The funding consists of three elements: the directed issue of DKK 7.8 million, which was carried out and announced the 1st of July. We have a loan facility of DKK 20 million. I will come back on that also. We have a preferential right issue of warrants, which sums up to approximately DKK 93 million.
The directed issue, which was carried out in the beginning of July consists of DKK 6.6 million from external investors, and it was based on the volume-weighted average stock price of 10 days, which was 12 DKK per share minus 20%. It was also a directed issue by management and board of direction, also carried out a directed issue also on a subscription price of 12 DKK per share, but without any discount. Also a directed issue of 625,000 units. I will come back to the mechanism in the units also. It comprised a total of 1.2 million warrants of the TO2 and 625,000 warrants of TO3. Fenja, which has provided the loan facility, and they have also signed a pre-subscription agreement regarding the subscription of these units, and that was also approved of the extraordinary general meeting of the 2nd July.
The loan facility provided by Fenja Capital, former Formue Nord, it sums up to DKK 20 million. Curasight. It can be drawn in two tranches. We have decided to draw up the first tranche that has been conducted, and 2nd tranches of DKK 20 million can be drawn up upon the warrants of the series TO2 and TO3 have been submitted for trading on Spotlight Stock Market. We will say that the facility is based on market conditions, set up via 5% and interest rate of 1% per month. There are two separate maturity dates for the loan. The first half is the end of this year, and the second part of the loan, if we are utilizing that, will be of the 31st of July 2025. There is also a loan comprising of the loan facility.
There is a conversion right for Fenja Capital, and they are obliged to right now, from now until the 5th of December 2025, which is planned to be the last exercise period for the warrants of TO2. Fenja has the right to request for a directed issue comprising a total of amount of half million DKK. That is the half of the first tranches. The subscription price will be 150% of the subscription price of the directed issue from the external investors. That means that they can subscribe for 14.4 DKK per share if they want to utilize that. For the second part of the warrants, Fenja is able to do it from the 6th of December to the 19th of June 2025, which is planned to be the last day of exercise of the warrants of the series TO3.
They can request for a directed issue, also sums up to DKK 5 million, but for a subscription price corresponding to the 175% of the subscriptions price right now. That means that they can subscribe for new shares, sums up to DKK 16.8 per share. Curasight can repay the loan, and any interest before the maturity date. That is also important to emphasize. If you look at the preferential right issue and warrants, we understand that this can be complex, and we will do more about how to make it clear for everyone who is not utilized to deal with that kind of instruments. After the prospectus has been submitted, there will also be a teaser explaining in more detail how to handle this instrument. There will be a preferential rights issue of total of 1.2 million units.
Each unit consist of a total of 2.4 million warrants of the first series, 1.2 million warrants of the second series. The preferential rights issue of units is intended for all shareholders in Curasight at a specific date. That will soon be communicated, together with the prospectus, to be carried out with a subscription price for DKK 0.1 per unit. We are not able to give it for free because the systems cannot handle DKK 0. One share is equal to one unit right. How the mechanism is that it requires 17 unit rights are intended to give the shareholder the right to subscribe for one unit, and one unit consists of two warrants of the first series and one warrant for the second series. The warrant of series TO2, the exercise period will be the end of November to the 5th of December.
The exercise price will be based on a volume-weighted average price of 20 days with a discount of 30% and be within the range of DKK 11.5-DKK 15.55. If all the warrants are utilized, Curasight will receive up to DKK 57 million. All the warrants will be on the Spotlight Stock Market, trading at Spotlight Stock Market. The same is carrying out for the series TO3. The exercise period will be in the beginning of June to the 19th of June. The exercise price will be based, again, on a volume-weighted average price of 20 days with a discount of 30%, should be triggered within the range of DKK 15.55-DKK 19.4. If all the warrants are exercised, Curasight will receive up to DKK 35.7 million. Those warrants will be traded at Spotlight Stock Market. Very short.
This will be communicated specific on the dates for this expected timetable. We expect very soon to be able to publish the prospectus when approved by the Danish Financial Supervisory Authority. The board of directors decides to execute on the preferential issue of units to existing shareholders. That will be allocated for all shareholders. We expect that the trading of warrants, both series will be able to be traded at Spotlight Stock Market in the beginning of October. You have the exercise period for both series in the end of November to the beginning of December this year, and also in the beginning of June next year. That was the presentation. We understand there are some good questions also from the audience.
Thank you, Ulrich and Andreas. Let's move directly into the questions and start with the first one here. If you present preliminary data from your study already in Q4, will you then be subject to another milestone payment from Curium?
Not at this point. I will not be too specific about that, there will be a large milestone obviously later in 2025 from Curium. Right now we are running according to the plan, not at this triggering point, that is more to give the market comfort about and of course, also Curium comfort that there's a proof of concept in the way the study is structured.
Yeah.
Maybe I can just elaborate a little bit on it. The Curium study has 2 parts. As you remember, it's this non-invasive biopsy imaging instead of a biopsy to see how aggressive the cancer is. We have already, from an investigator-initiated study, shown the connects, this would be a larger study. The part 1 establish, when you have prostate cancer, you have different aggressiveness degrees. Either it's rated on something called Gleason score or something called ISUP score. The first part will connect the readout from uTRACE with these scores, there will be an equal number of patients in each group. This is kind of enriched population because most patients in real life are low scores. We have to establish the correlation in a data set where there are enriched population with the same number from each group.
Part 2 applies this correlation and the cutoffs on a real-world population in the way that the vast majority will have the case mix will be as in real life. Most of these prostate cancer patients will have the lower grades. That's why it's divided into 2 parts.
Okay. The next question. Are you seeing more interest from institutional investors after securing some funding and after the market is beginning to maybe loosen up a bit again?
Yeah. Certainly, we do. Also, yeah, not only from the U.S. but also here in Europe, there is definitely an interest in biotech and also specialized, specific in this area, radionuclide therapy, what we are aiming for. They will see that also the transaction also what Andreas explained previously in the presentation. It's not only within the pharma industry, also larger capital funds and now see there's a potential upside in those smaller biotechs, but also to make a good exercise down the road.
Yeah. Can you explain the TO2 and TO3? As I understand it, the stock price has to move up a certain amount over the next period for the TO2 and TO3 to be of extra value for investors, or is that not true?
Sorry. That's right. Just go back. If you look at the window, the TO2 can be exercised within the range of DKK 11.5-DKK 15.5, and there's a minimum price of DKK 11.5, no matter what the stock price would be. Also, let's say the stock price was DKK 25 per share, then you could still utilize it within this range, which means that you could exercise the warrants for DKK 15.50 per share. That is how it's structured right now. That is the same mechanism for the TO3 that you have this range to exercise. That is a task for us to ensure that there's a good comfort in the stock price, whatever it's. That's not always seems to be some. What do you call it? The actions that is done in many companies is not always reflected in the stock price.
That is what we are aiming for right now and how it's supposed to be carried out.
Maybe if we would like just to comment a little bit also on our strategy, you're totally right, it needs to go up, not much. The upside, of course, is almost unlimited. If it skyrockets, you can still exercise your warrants at a relatively low top price. It's also structured in the way that there are clear value inflection points prior to the exercise. It should be surprising if those value inflection point are not being reflected somehow. You never know.
There are other activities going on. Unfortunately, we are not able to disclose that yet. Hopefully, we will be able to come with that later of the year in some way. Right now, we are focusing, of course, that is also the most important part, the clinical part, and the data from that. We will see what happens.
There's a follow-up question regarding the warrants here. What happens to the warrants if the stock is not traded in the range explained?
There were lapse.
There's another question here around the TO2 and TO3. What will you do to increase awareness and attract more investors for better success with the TO2 and TO3 and increased share price?
That is what as I mentioned before, other activities is also going on, and we are really aiming for also to onboard larger investors. That will be attractive for those investors also to gain those warrants. That is definitely, I would say, a task for us to ensure a more strong financial base from the investor side.
Redeye has calculated a fair value of around DKK 27 per share and have only included one uTREAT area. The stock is far away from this, why do you think investors are not willing to pay a higher price at the moment?
I will not comment on specific where the share price is right now. I could just say that the SEB also come out with an update on the coverage last week, and they stated that the target share price should be 54 DKK per share. Also what we experienced in the beginning of August, what's happened on the stock, in general, I would say it's difficult to predict what happens. The only thing we could say that we have a plan, and we will work for that and execute on that. Then, of course, we also hope that we have the necessary trust from the investors to support.
I think you fell out a little bit there, Ulrich, but I think we got the point.
Yeah, I did.
Okay. We then move on to the next question. There's a question around the M&A market. I think you have already explained a bit about it. I will just read it. You have any more context to it, or then we can skip it. Do you have an update on the M&A market? We have been talking about a high interest for some time. Do you still see larger companies with high interest in this field?
Yeah, definitely. In the beginning, they were only interested in late-stage companies, means that you are more or less finalizing the phase III or going for a market approval to step in. Now they are really looking at earlier-stage companies. That is definitely in our interest also, of course, both. They are looking at new targets also. As Andreas mentioned previously, Pluvicto and also LUTATHERA, they are two specific targets. Now they are also looking at other targets like uPAR. That is, I would say, the next 12 to 18 months will probably be very interesting for Curasight and also excited what happens there.
Yeah, you can say, just to elaborate on Ulrich, that big pharma is moving earlier, and we of course, are moving later by the activities we have. Things are crossing, and when we go to international conferences, basically, yeah, that's a cue to get appointments to learn to know where we are and at what stage is it. We can really see the interest in the space.
There's also a follow-up question in this regard. What is the reasons for larger companies to buy into some of your competitors instead of you? Is it the pipeline, the phases they are in, or the technology, or do you know the specific reasons?
Yeah, I think I can put it because we had some in-depth discussion with a lot of the companies, and that's what Ulrich says is working in our direction. What you have seen until now has been, at least to me personally, a little bit surprising that a lot of the transactions have been in something that is very similar. It has been PSMA in prostate cancer labeled in different ways, but in essence, competing with each other. The whole concept for big pharma with radioactivity is something that decays. You cannot produce 2 years of inventory, but you have to produce in close relation to it being used. The logistics was totally new for big pharma. When they dipped their toes, they wanted something that was far advanced, a very known and validated target, and ideally something that somebody else already did with success.
Now, of course, that also becomes busy areas. Now people are looking for earlier assets, more innovative targets as we have. For instance, as I said, it has not been what is marketed right now. It's not multi-cancer drugs. They go for one cancer type. Ours, once it's fully developed for imaging, we can use it in any cancer type, and when uTREAT is ready, we can use it in almost any cancer type. They are moving in that direction. That is the reason. I think the main reason is that the whole concept of a radioactive pharmaceutical was so novel and so overwhelming for big pharma's traditional logistics set up that they were a little bit afraid of whether it could fly.
Then maybe we can mention that PLUVICTO, the PSMA ligand, that was approved in one year and already the next year, that is the first full year it was approved in the U.S., it was a blockbuster drug, which is defined by more than $1 billion of sales in the U.S. within one year. It was on par with the most successful other drugs they had. Then it kind of was an eye-opener. The two first companies and projects were bought by Novartis. A lot kudos to them that they basically took on the thinking that this can be done because if it's important for patient, we can help patient and the price tag is high, which it is, $190,000 is the list price for a full series of therapy. It can also be done to get the logistics in place.
That paved the way. Now everybody can see logistics. Also on the supply side of, for instance, the radioactivity, that was difficult to get hand on in the beginning. Again, now there's a market for companies producing large scale in GMP these radioactive isotopes, so it has also become easier in that way. It's a very pioneering field that suddenly has been demonstrated by big pharma. It's a viable business model that can benefit a lot of patients.
Yeah. Interesting.
Yeah.
Then we are actually at the final question here, and I think you have already addressed some of it again, but I will read it then you can put some more context to it. You have probably explained this before, but there are other targeted radiation companies in the world. What makes you different from those other companies, also those that have been acquired by larger corporations?
Yeah. If I can start.
Yeah.
First of all, and I think I mentioned this several time, we are clearly a multi-cancer. We are developing a multi-cancer type drug. uPAR is a cancer marker that is not limited to certain cancer types. It's positive in 80%+ of solid tumors. You have the development cost basically being taking that once and then you can test it in many. That is one key difference from, I would say, the bulk that is out there. There are, of course, other companies also looking broader but still, it's a new way to look at it. Our target is an aggressiveness marker. The more aggressive the cancer is, the higher the target is, which fits well to the more aggressive the cancer is, the more you need the therapy. You could turn it around and say, what if a patient does not have uPAR expression?
We can say then it's also a relatively benign tumor and you don't need the therapy. It fits very well. The most aggressive are the easiest. We will have the highest uptake. Then finally, the platform, and we are not the only one working with this, but there you can have the binder to the cancer cell can be different types of compounds. We use peptides that are very small molecules. A lot of other companies work more on antibodies or something in between. We believe that peptides have a lot of advantages. They are very easy to produce and easy to control. If you have an antibody, basically one production batch is not 100% identical to another one. They are small. It's called biologics. The setup, the cost is more difficult. It's much easier with peptides.
The peptides also circulate for a short time in the blood, which means the radiation burden to healthy tissue is much smaller than, for instance, with antibodies. I would say the multi-cancer target that it is intelligently when the tumor is most aggressive, that is when we have most of our target, and that we entirely focus on peptides, which we see have advantages from a chemical point of view and from a patient treatment point of view. That is the key checkpoints where we are differentiated from a lot of other companies.
Perfect. That was actually all the questions. That finalizes the Q&A for now. Before we end the webcast, I will just hand over the word for you if you have any final remarks to end with.
I would just say thank you for attending this presentation. We expect this second half of 2024 will be very exciting for Curasight. What the plans both for the pipeline, the clinical trials, but also what is going on at our site. We hope that you will be or if you still are a shareholder, maintain being a shareholder in Curasight because we are moving into very exciting times.
I can only echo Ulrich's comments and also thank you from my side for listening and supporting the company.