Good morning, and welcome to the Q1 presentation of Gentian Diagnostics. My name is Hilja Ibert, and I have been, since July 2018, the CEO of the company. Yesterday, we had the annual general meeting, and during that meeting, I had been elected to become the chairperson of the board. As a consequence, I have resigned as CEO, and I'm joining today this presentation to inform you about this leadership change and as well, being available for questions if you have them at the end. I would like to take the opportunity of this presentation as well today to thank Tomas Settevik, who had served as chairperson for many years, and the company has progressed extremely well during this time and under his serving as chairperson.
Yeah, so, me having resigned as CEO, we have constituted the board yesterday and have appointed Njaal Kind to take over as acting CEO, and I thank you, everybody, and welcome, Njaal.
Thank you, Hilja. Thank you, Hilja. So, as Hilja mentioned, my name is Njaal Kind . I'm also the CEO of the company, so you might have seen and heard me before. Before we start the presentation, I just want to give a few practical information. Please, if you have any questions, use the questions box, normally in the right corner of your screens, and then we will try to group those questions and answer them out once we are finished with the presentation. I'm also joined today by Aleksandra Havelka, our Chief Scientific Officer, and Markus Jaquemar, our Chief Commercial Officer, and they will jump into the presentation a bit later. So let's get going with the presentation. For those of you who doesn't know us, we are a medical diagnostics company.
So we make basically treatment decisions or aid in the treatment decisions of physicians. We are not the type of company that produces or invents new markers. Our business idea is to take existing markers running on low throughput inefficient platforms and turn them into markers that can be run on the highest efficiency platform, also known as PETIA or clinical chemistry, which are the highest throughput platforms out there. By doing that, we contribute to faster results to the patient, and we also solve bottlenecks in the laboratories by increasing the throughput, so the number of tests that can be run on a daily basis, and that contributes then to cost efficiency. We have been in the market for several years.
Currently, we have five tests, which are established products, so we are selling those to the laboratory industry and partners, and we have one marker in market development and one marker in product development. I'll come back to those a bit later. We are a company focused on people, and here in Moss, we have a world-class setup of technical personnel, both when it comes to our research and development and our operations and manufacturing. We have been around for a while, so for the past years, we have a 30% annual growth rate. We are proud of that, and we have a target to have at least 20% annual growth rate.
So far, we have been above that, and our business model is, to a large extent, based on partnerships, so that we don't have a huge numerous sales team, but rather give away a little bit of our margin to partners, which run the commercial operation in a better way than we are able to do. We are centered in Moss, Norway, that's just south of Oslo, and we have offices in Sweden, two offices, one in Gothenburg and one in Stockholm, and we also have a representative office in China, and we have a sales office in the United States.
Now, I'm going to start the review of the first quarter results, and when we have had a look at the numbers, I will let Marcus and Aleksandra give more insights into some of the products. So we are very pleased to report today a record sales of NOK 38.5 million. That is 22% growth compared to the same quarter last year. If we adjust for currency tailwinds, it's a 19% organic growth. EBITDA, we report an EBITDA of NOK 4.8 million. That's a strong improvement compared to -0.5 million, same period last year.
It is driven both by a solid gross margin of 53%, which again, is influenced by positive product mix and also synergies or effects from the integration of the Getica acquisition, which was performed in July last year. But also, as we will see, the operating cost is also basically unchanged from last year. The star of the quarter in terms of sales is fCAL turbo . We have recorded a 44% increase in sales compared to first quarter last year. On a, let's say, good second, we have third party sales, which is a distribution business that we run out of our Stockholm office, recording 31% growth compared to first quarter last year.
Of significant events in the quarter, I'm happy to report that and we also put out a stock exchange release on this, that we received the final KDIGO guidelines, which recommends increased use of Cystatin C. We're gonna talk a little bit about that later. And we're also pleased to report that NT-proBNP has made significant advancements in the quarter, and that the development is now in what we would consider to be the final stages of the optimization. So, definitively, several steps in the right direction when it comes to NT-proBNP.
Looking a bit more at the sales, we see that if you look at the geographic split, we see that Europe is increasing from NOK 22 million to almost NOK 28 million compared to last quarter. And this is where we have had the biggest increase. In Asia, sales have been essentially flat, and this has to do with the fact that to Asia, we have some large volume customers which are not ordering every quarter. So here we do see some quarterly variation. And as I said, from a product level, fCAL turbo shows strong growth compared to last year. But if we look at the totality, all products and all regions have shown positive growth compared to first quarter last year.
So definitively a good quarter from a sales point of view. So if we look at the cost side, gross margin, 53%, that is, when we look historically, a strong gross margin. We have been there before, but as you see, there are also variations to the gross margin, very much influenced by the product mix. And the product mix this quarter has been favorable by lower volumes to China and Asia, where we have lower margins than we than we have in Europe. When we look at the operating expenses, we see that we have increases or an increase in sales and marketing.
That has to do with the fact that we are still investing in increased sales, and increased sales does not come by itself. We need to apply, we need to add resources, and we need to add investments in sales in order to grow. The other parameters are essentially unchanged. So if we look at the total, 18.5 versus 20.4 million last year, headline, it looks like a reduction. But if we add in what has been capitalized in R&D, we are in fact at the same level in terms of expenditure as we were at the same quarter last year. So no change, and seeing that in relation to a 22% increase in revenues, we believe that is a satisfactory development. Cash also an important parameter.
We are pleased to report that the cash position is largely maintained from year-end last year. We had a free cash flow, NOK 1.8 million minus. However, if we look back and compare to the same quarter last year, we have accumulated NOK 9.6 million, so almost NOK 10 million, in cash compared to that point in time. So, we are obviously pleased with the-- how the cash situation has developed. Also, equity ratio, we have, for practical purposes, no interest-bearing debt, so we are operating with a high-... I will leave the stage for some minutes and leave it to Markus and Aleksandra, which will provide you with a product update.
I'll be back with a summary and also available for the Q&A. So I see Markus and Aleksandra is getting ready here, so welcome.
Thank you, Njaal. Thanks Njaal a lot. I provide a bit more detail on selected products, which have contributed mostly to our sales growth. I will start with Cystatin C, an important kidney marker, which actually happens to be the first product that the Gentian introduced, yeah, 2007, actually many, many years ago. It's taking a lot of momentum. So what we are showing here now is actually quarterly development of the sales for our products. You can see the Q1 results for Cystatin C being actually the second strongest quarter ever for Cystatin C. What's really significant, and this is what Njaal already alluded to, was the introduction of these new global guidelines, which recommends the increased use of Cystatin C.
And Alexandra actually will talk a bit more about those guidelines, but that's a small effect in Q1 as these guidelines were introduced just this quarter. But overall, they show the development of usage of the product in general. And so the reason for our results in Q1 and ongoing, actually, is very strong product sales in the U.S., where they have shown higher and earlier adoption for Cystatin C already in certain institutions, but also in Europe at the same time. Again, reason for that being that our partners and we have obtained more customers. So the customer base is growing. At the same time, the average usage by customer for those tests are increasing. So that's obviously a strong momentum going in the right direction.
Njaal already mentioned it, that Asia was kind of soft in Q1, but nothing surprising. That's been historically the case as you see also in the quarterly performance. So typically, the second half coming from Asia has shown strong performance. So the quarterly growth of 10% is mainly associated with strong growth in Europe and the US and soft results from Asia. But what's important also going forward is certainly the importance of those new released guidelines, which are relevant globally. And for that, I'd like to ask Alexandra to shed a bit more light on about those guidelines and the impact. Alexandra?
Thank you, Markus. So as Markus already mentioned, new clinical guidelines were published a few weeks ago, and these guidelines are dealing with re-evaluation and management of chronic kidney disease. So in the latest version of guidelines, the significance of Cystatin C in estimation of glomerular filtration rate, which is a tool for assessment of kidney function, is emphasized, and also the role of Cystatin C in the risk assessment and clinical decision-making in patients with chronic kidney disease. Patients with a chronic kidney disease are very often asymptomatic until late stage of the disease, where kidney function is moderately or severely impaired. So it is of high importance to detect these patients in an early stage.
So in these guidelines, the importance of early detection of chronic kidney disease is discussed, and especially in the patients which are at the high risk to develop that disease, for example, patients with diabetes or hypertension. So the guidelines suggest screening of high-risk patients with biomarkers, including Cystatin C. These guidelines also highlight the limitations of creatinine, which is another biomarker, old biomarker for assessment of a kidney function. But as we have previously informed and discussed, there are several limitations with creatinine. So in that cases, Cystatin C is recommended for improved accuracy to be used in addition with creatinine. And also, several conditions are mentioned in these guidelines, where Cystatin C should be a preferable biomarker to be used.
For example, people with abnormal muscle mass, elderly people, people with different kinds of malnutrition, eating disorders, et cetera. So the guidelines strongly recommends use of Cystatin C for estimation of glomerular filtration rate and the kidney function in adults at risk for developing CKD. And they recommend use of validated equations, not only use of the concentration of a biomarker, but that's in a connection to established equations for estimation of GFR. And of course, the guideline emphasize importance of standardized laboratory testing for accurate GFR assessment, both for Cystatin C and creatinine in order to assure reliable and comparable results across the laboratories. So this is the summary of the latest update of the guidelines. So back to you, Mike.
Thank you so much, Alexandra. Very exciting to hear about the development for guidelines for Cystatin C. The next product, and Njaal introduced already the star of Q1, is fCAL turbo . So an assay which is relevant in the gastrointestinal testing area, and we have seen 44% growth on a quarterly basis. Now, if you go back to Q1 2022, that's actually more than doubling the sales for fCAL turbo . And this is the result of very professional collaboration with our long-standing partner, BÜHLMANN Laboratories, from Switzerland. And the second or the market reason for that is that with the format of this test developed by Gentian and BÜHLMANN is that it enables a high adoption into core laboratories around the world, and that definitely favors the sales development and the adoption in general in laboratories.
A second strong reason for the performance is partnership with global large IVD companies that are starting to really implement the assays through their sales channels globally. And the combination is the result of 44% growth in Q1 2024 versus 2023. And we definitely very positively look into the future for further development of that product. The third growth star in Q1 with third-party products, actually, Alexandra is heading the organization that is selling the third-party products in Scandinavia. And reason for the nice growth, also, when you see it on a quarterly basis, you see very strong positive trend, attention to the local markets. We have increased our presence in the Nordics, so we have gained new customers, and we have also introduced new products.
What is very, very important as well is strong and positive feedback from our customers, including the largest laboratory, actually, in the Nordics, about the support from the Gentian organization, and it provides us direct access to the market, which is also important in developing new products for the market going forward. So that's the third element of strong growth in Q1. Njaal already mentioned it, overall, the growth across all regions that we cover. We're a small Norwegian company, we're active globally, and we're active globally through our partners. And when you look at Q1 2024, what you see, very strong portion of our business, obviously in Europe, which is our home base. Asia was soft, right? No, no, no strong growth. Explained, that's a usual pattern.
We have this small but nicely growing element on top, which is the U.S. We are making some investments into the U.S., and from a market perspective, the U.S. market, with 40% of the global IVD market, is the largest market. So we see a lot of potential in the U.S., and we already see nice growth in the U.S. and are very much looking forward to see that trend continuing in the future. So with that, again, on a quarterly basis, very nice growth in all regions, with lots of opportunities going forward. With that, let us come to the next topic, and Aleksandra will talk a little bit more about our progress with NT-proBNP.
Thank you. So yeah, we would like to share some good news and update you on the development of our NT-proBNP assay. So, our R&D team has, in the first quarter, achieved significant advancements in the technical development of the assay, assuring that we will have a product with good quality. Stability of an assay is very important factor for successful launch of the product, so the R&D team has worked on the stability of the latest prototype. And so far we has very good and promising results, both on the quality and stability of the assay.
We have also performed some experiments related to upscaling of the production to make sure that the assay will keep a good quality, even when transferred from a small scale to a large scale production. These results look very promising. We have in addition done several experiments to prove the hypothesis related to glycosylation of NT-proBNP. And as we previously communicated, many assays on the market today are affected by glycosylation of NT-proBNP and may underestimate the concentration of this important biomarker in circulation. Our assay is not affected by glycosylation of NT-proBNP. That has been confirmed, and these results will be presented at the Heart Failure conference in Portugal in May.
We have also expanded our advisory board for NT-proBNP, which now includes clinicians, cardiologists, and representatives from both private and public laboratories outside of the Nordics. As we have previously communicated, the product, we believe, we consider this product to be at the end of the optimization phase. But the time to launch from optimization is approximated to be between 12 and 18 months, and that includes further development of the prototype in verification and validation phase. It includes clinical studies and proof of clinical performance of the assay, and all necessary work related to successful registration according to the IVDR requirements. This was all about NT-proBNP.
All right. Thank you, Aleksandra. We are approaching the Q&A session, so if you have any, any questions, please use the questions box on your screen. Before we go there, we would just like to provide a short summary of what we have spoken about this last 25 minutes. Quarter one for us has been a busy quarter, and it's been a good quarter. We have recorded good sales growth, record sales, and we are also quite proud to see and to show that all the hard work is starting to show in the numbers, and that we are reporting profitability. We are around the turning point here.
If you go a few years back, you would see that we have had an EBITDA of NOK -10-15 million. Last year, we reported NOK 3 million plus, and year to date, we are ahead of the full year last year, where we have nearly NOK 5 million in EBITDA. So what we are focusing on here going forward is profitable growth. We can obviously not, at this stage promise a NOK 5 million EBITDA quarter, every quarter going forward, but profitability is definitely a KPI for us, moving forward. I would also like to highlight the non-financial statements on this slide. The fact that we have very strong recommendations for increased use from KDIGO will support the growth of this product for many years going forward.
This is, for the moment, our biggest product, and it will continue to grow. That is at least what we believe. Also for NT-proBNP, we have made major advances, and we believe that we are in the final stages of optimization. Hopefully, good news to come there in the not-so-distant future. I think by that we conclude the presentation, but we start the Q&A. I will be joined by the different participants here, depending on the questions. We can start at the top of the list here. It says: Congratulations on very good numbers this quarter. Was this quarter considered to be an especially good one, or can we expect the same trend to continue going forward?
I think sales-wise, we have stated that on the established products that we have in the market, we are targeting a minimum 20% growth per year. We are currently on that trajectory for Q1. Historically, we have been at 30 unadjusted. So sales-wise, yes, we believe that the trend will continue. I can tie in another question here, which goes into yeah, should we expect the cost base to stay largely flat, or are you looking at any investments? Well, the cost base was flat now compared to quarter one last year, so we are obviously pleased with that. Going forward, we believe that the cost base will increase, and that's for two reasons. First of all, 60% of our cost is related to personnel costs, so salaries.
We do see the same development as other companies, that salary growth is higher than what we have seen historically. And secondly, with let's say 20% growth, we have to add the resources, and we are adding a few resources. We can call them investments, but they will be booked over the P&L. So we do anticipate an increase in the OpEx going forward, but not to the extent where it should hurt profitability. And we have two questions on NT-proBNP. Positive development on NT-proBNP, how would you assess your position with NT-proBNP in the current market landscape? I think, Markus, you can speak to that.
... Thank you, Njaal. Very interesting product, NT-proBNP, very important for us going forward. What we clearly see, it's a busy market already, which is dominated by significant players in the IVD business. All the major players have currently NT-proBNP assays in the market. However, there is a recognition in the market that there is room for improved performance of an assay like the one being developed by Gentian. So our business model, which is working through partners, is obviously depending also on the adoption, not just by end user customers, but by partners. What we see is an openness to look at alternative testing measure assays and methods, including by the potential partners that we are talking to.
We are convinced that the assay will provide differential benefits, and as such, will also raise interest from potential partners and end user customers, the like. It's a very significant market with about $1-1.5 billion market size today already. We're very optimistic of strong interest and adoption for our version of the NT-proBNP assay.
Okay, thank you, Marcus. I think you can just stay here because we have another question on G-Cal, actually. It goes into how is the development going with the market development of that product, outlook, partnering opportunities, et cetera. Could you put a little bit flavor on that?
Definitely, definitely. We've actually seen good performance in Q1 for GCAL, which is essentially linked to the increasing number of routine customers in Europe, but also actually in Asia. We have seen first interest for the product also in the US, where it is not registered yet, by the way. We are also discovering specific segments for calprotectin in the autoimmune rheumatoid arthritis area, with already existing guidelines using calprotectin. So overall, we're seeing good growth for the product within the existing, but also with new customer base. So going forward, definitely positive, including the discussion with large IVD partners who are interested to implement the assay as part of their menu. Positive signals everywhere. Thank you, Njaal.
Thank you. Yeah, we have a few other questions, NT-proBNP, you know, draw the capitalization, is it NT-proBNP? Yes, all the capitalization is related to NT-proBNP. Since we are where we are with that product, we capitalize the R&D expenses to the extent that we are allowed to do that. And a clarification, should we expect sales to grow faster than cost going forward? Yes, if you look over several quarters, that's definitely the ambition. From quarter to quarter, you will see variation, because we do have larger variation in sales from one quarter to another than we have in our cost base from one quarter to another. I think the last question we have on the list here now is the status and outlook for our pipeline.
As we have reported, we have two products in the pipeline. We do not yet have proof of concept. We are working hard to get to a proof of concept on at least one of those markers. Having said that, I think everybody we speak to agrees that it's the right prioritization. Our focus is on NT-proBNP, and we put more resources into NT-proBNP, and that, of course, results in somewhat slower development on the rest of the pipeline. So I think once NT-proBNP is moving forward, then we can also free up more resources on the pipeline.
But we do have developers on the pipeline, so we will report as soon as we have proof of concept on one of those two markers. I think that's where we are in terms of questions. Just to wrap up, from our side, thank you very much for attending this webcast. As always, if you have any questions, you can contact us at any time. Or if some would like to organize presentations or meetings, we are always available for that. With that, I say again, thank you for listening, and thank you to Markus, Aleksandra, of course, Hilja, for assisting on this webcast. Have a nice day. Thank you.