Hello, and welcome to this Q3 report from Lifecare. My name is Joacim Holter, and I'm the CEO of Lifecare. The full Q3 report is available for download at lifecare.no, at the investors section. Today, I will take you through this agenda. First, I will start to inform about our financial highlights year-to-date 2023. First of all, Lifecare is continuously investing in preparations to reach our strategic goals of automated production and product launch in 2024. On this base, we have also reduced our internal group availability for third-party customers in terms to prioritize our capacity, to ensure that we are as good positioned as possible to reach the goal to meet the automated production and product launch in 2024.
While our operations are driving the group's salary and personal costs, other operational costs are in line with our forecasts and expectations. It's also worth to note that we have a stronger equity and cash position, compared to the same period last year. The roadmap for our development is split in three sections. The most important is obviously the top one, production and market launch. While the in vivo studies and regulatory compliance is extremely important in terms of our approach to the human market later. Our core goal is to be able to go into production and launch in 2024 for the veterinary market. In the third quarter, we have met the goal to order our automated software for production automation.
We have identified the supplier of our upcoming production equipment, which is size, and we have access already now to the machines that we will use for our automated production. On the way towards production, we have now then ordered the software we need to do the production. We will customize this software, whereafter we plan to order our production equipment in the fourth quarter of 2024. In addition, we have also met our goal to get to receive the approval for our upcoming study. We will carry this study out in dogs at the Veterinary College of the Norwegian University of Life Sciences. The objective of the study 002 is to compare data to achieve data from for longevity and biocompatibility.
As the third achievement in the third quarter, we have also defined ourselves as ready for ISO 13485 audit, as the preparations has been finalized, and as previously communicated, we are also now awaiting the audit from regulatory authorities in the course of November 2024... sorry, 2023. We are doing one slight adjustment in terms of our roadmap. We experienced some delays in from some suppliers in the radio communication units we need to read out in the second study. The details of this is that the dedicated supplier did not meet our objectives in terms of a temperature sensor in our radio communication unit.
Consequentially, consequently, we will not be able to start our second study in the fourth quarter as planned, so we have to push that out until the first quarter. That means that we will continue our preparations for the second and the third study in the fourth quarter, and we will carry out the second study in the first quarter of 2024. We do not expect that this occurrence in any way will affect our major timeline, our major roadmap towards the automated production and the product launch for the veterinary market. This is merely a slight shift of focus until the first quarter of 2024.
Other operational highlights from our side is that we, in the third quarter, executed and finalized in vitro experiments with our prototype sensors that confirmed that the technology has an operational lifetime of that is superior to existing CGM technologies applied in needle sensors. While this is an in vitro experiment, it's following up our in vivo experiments, so this is an addition to our in-human testing, where we got the confirmation, as we did in animals previously, that the technology as itself works perfectly well in live tissue.
So in terms of the longevity, we have also had laboratory experiments, where we were mimicking tissues and tissue circumstances, and were able to then pull off an experiment that we concluded in July of this year, where we reached an operational lifetime of 172 days for our sensors. That's 24 weeks, and that included a chemistry shelf life of 187 days, so 27 weeks. And this is a strong confirmation for the outlook that we have communicated previously, that the sensor technology will last for a minimum of six months. We look forward, of course, to confirm this in the longevity studies that we will do in dogs, together with the Norwegian University of Life Sciences, starting in the first quarter of 2024.
Second, we have communicated around our product development program with Sanofi lately. The background for this is that we are engaged with Sanofi in a product development agreement of the Sencell technology, where we have given Sanofi an exclusive right of first refusal to negotiate a global license agreement for the Sencell technology. The program consists of defined phases, where Sanofi is obligated to provide financial development contributions when predefined phases are finalized. In the course of September and October 2023, we were finally able to submit two phase-end reports to Sanofi, triggering the release of development funding contributions to Lifecare. We do expect to reach the next phase end in this program, in the first quarter of 2024.
The third operational highlight I want to address is the fact that we, in October, so after the end of the quarter, secured funds to establish automated production, further production, the product development, and preparations for market launch. October 19th, we issued 17 million new shares at a subscription price, including the issue premium of NOK 2.5 per new share, raising a gross proceeds of NOK 42.5 million Norwegian kroner. The price per share in the private placement entailed a discount of 15% to the price at market closing on the same day, which in our view, is an absolutely reasonable discount, given the tough financial market and the tough financial circumstances that we see in the world today and has seen for a very long time.
And the very, very important thing for Lifecare, of course, is to enable to secure the funds to continue on our development towards automated production in the course of the second quarter of 2024. I want to jump into a valuation report that Lifecare has commissioned from the company Xplico. This report was published in the market November 1, 2023. The reason for us doing this is, first of all, our old valuation, that was an internal valuation, was close to two years old, so we wanted to redo our internal understanding of the value of our technology. In addition, since our last valuation, we also have started with the veterinary market, and we wanted...
We then asked and commissioned Xplico to do a dedicated investigation and valuation also towards the veterinary market. The full report from Xplico is available also at lifecare.no, under the News section. I want to go through some of the summary slides from Xplico. Xplico, as the report is close to 70 pages, I'm not going to do that here, obviously. First of all, the development assumptions put in is based on interviews with Lifecare. It's based on public available information around Lifecare, but more important, and maybe most important, of course, the investigations that Xplico has done and the calculations that Xplico has done to gain a complete valuation consideration of our technology.
I want to highlight, first of all, that their conclusion around the development time to market related to the pet market, meaning the veterinary market, is defined to one year from the date of the report or within one year from the date of the report. In this context, I also want to point out the fact that you see on this slide that the development costs is stated lower on the page. The development costs for human are stated to be EUR 6.6 million, while it seems to be no costs for the pet market. Also, you will see under the development timeline that the LFC-SEN-002 study is marked with human, and this is part of our strategy and also reason for going into the veterinary market.
The fact that we are not investing actual funds to be able to pull off a sensor for the veterinary market. We are taking advantage of the synergies that we are doing in the human market and transfer those to the veterinary market, because we would, in any case, need to do these things. So we actually define that we have no extra costs related to go into the veterinary market. And I also think it's worth highlighting the fact that Xplico envisions that the probability of success in the veterinary market is 90%. That is, of course, explained in detail in the report.
And the reason is because we, we are only missing one study, which is the 002 study, and then we would be ready to go into the veterinary market because the regulations there are much lower than what they are in the human market. And continuing into the market assumptions from Xplico. They have identified a potential to have a peak market share of 3%-5% within the human market and 30% within the pet market or the veterinary market. And the reason for doing so, I think it's, it's a bit interesting, is that they have not kind of, they've not come up with these numbers without actually having a documentation below it.
What they say for the human market is that the benchmark market share, based on analysis of 492 drug launches in 131 classes over a 27-year period, show that the fifth and the sixth player into the market gain a market share between 2% and 8%. And from that point on, assuming that we will follow after several other candidates, they assume that it's more than reasonable that we will have a market share of 5% for the Type one diabetes patients and 3% for the Type two diabetes patients. These benchmark market share assumptions are completely and absolutely in line with the assumptions that Lifecare has done previously, and but now we also have a documentation based on analysis for why this is a reasonable market share goal to have.
And the same goes for the pet market, where the market is close to wide open. What we see in the veterinary market is that there is a use of existing CGM technologies meant for human use as an off-label use for pets. The assumption from Xplico in this relation is that we will be the second to the market, following the off-label use of existing human devices, meaning that it's reasonable to expect a market share of 30% of pets in the EU and in Europe, in the USA and in Europe, sorry.
The outcome of this, and the conclusion from Xplico, is that they conclude with a risk-adjusted net present value of Lifecare's technology at EUR 247 million as of today, split into EUR 137 million for the human market and EUR 110 million for the veterinary market. This is, of course, very encouraging numbers to look into. It's a technology evaluation report or a technology valuation report, and it indicates that the market cap of Lifecare is has room for a continued increase in the time coming. I'm gonna leave this report and jump into the Q and A session. First, we have received some questions prior to this webcast, and it's...
I know it's also possible to send in during the webcast, so if anybody does that, I will take a look at that, of course. The first question we have received is related to Forget Diabetes, and the question is whether what the timeline in Forget Diabetes indicates that we have a report at the end of Q3, and the question is: "Can you say anything about progress and status?" First of all, Forget Diabetes is a scientific project that we are involved in, together with academic players in France, Germany, and in Italy. The purpose and the goal of this project is to create an artificial pancreas. Lifecare's mission, Lifecare's role in the project, is to come up with the sensor technology used in the artificial pancreas.
This project is supported by the EU, in the Horizon 2020 program, and Lifecare has received quite some funds to do the sensor development in the project. Our main activities in the project are finalized, so we are now producing our sensors to be connected with the existing, with the other elements, the other technology elements that form the artificial pancreas. The next milestone in this project is that our French partners in Montpellier will do clinical testing or preclinical testing of the artificial pancreas in pigs. The plan is to do that in the course of the fourth quarter of 2023. This is kind of just around the corner, and we hope to be able to do that within end of November.
It's not completely clear to us now when we will have any results from that, from that project. Of course, while we are focusing on glucose monitoring with our sensor, this is most absolutely in line with our core goal to go into the market next year. At the same time, the complexity of producing a completely artificial pancreas tells us that this is still a project on the academic stage. We look forward to follow it. We look forward to see the results from the preclinical studies, and it's a very exciting project for us to participate in, and although it's a bit unclear what this will mean commercially in the years to come.
I also received a question whether we can explain the Sanofi deal in detail, and the short answer to that is unfortunately not. This is a deal that is highly confidential, and we are able to communicate around it when we are obliged to do so by law, which we obviously are, when we receive funding in terms of phase and reports. What I can say, just in general terms, and also in line with what has been communicated previously, is that this is not a financially high-value deal for Lifecare at this stage, but it's a commercially very, very interesting deal for us.
It is important for us to be close to the table with one of the major players within the diabetes world, and it's also very important for us that this is only an exclusivity for a first right to refusal. Hence, we're able to also communicate and discuss with other big players in the diabetes community. We, as a company, would prefer to, of course, partner up to ensure that we can get a quite effective infrastructure in our supply of the technology when we're ready to go to the market. If we don't manage to do that, we will of course build this capacities ourselves, but the preferred solution is to do it via Sanofi or one of the other big players in the industry.
Next question is whether Lifecare will consider to uplist from Euronext Growth to the main market on Oslo Stock Exchange. What I can say to that is that, we have not made any decisions. The board of Lifecare has not made any decisions in that direction. Although we decided, from the start of 2023 to change our financial into IFRS, so that we are compliant with the regulations that we need to comply with, to be able to uplist from Euronext Growth. And of course, Euronext Growth is meant as a growth, list. At some point of time, it is natural for us to consider to do this uplisting.
Taking into consideration the position we have today, the development that we have done and how close we actually are to go into the market, this is something that we definitely will consider and discuss going forward. Also, with the valuation report in mind, we might consider this to be an interesting thing to do to ensure that we get more than at least a reasonable payback for our investors in the market. Then I have a question, whether we see any obstacles or challenges while the company is shifting focus from research and development to a phase of production preparations and final commercialization. Once again, to try to give short answers, the answer is yes, and I want to elaborate that a bit.
It's important for me to first state that our technology, our science, is basically done. So at the point of time where we were able to miniaturize our sensor down to close to the grain of rice size, and to reproduce results from this sensor, we communicated, and I believe that was the first or the second of June 2021, we communicated that the basic research is finalized. So we know that the technology works. We know that it works in live tissue. We know that it works for quite some time. So the next phases in the company is more about engineering and setting up production rather than to do additional traditional R&D.
On the other hand, the transformation from an R&D organization and into an industrial, commercialized organization is not something we can or will take for granted. This is complex on its levels. Although engineering is often easier than the basic science, it still can be quite time-consuming, and it also is, it's also important to ensure that the focus of the researchers are shifted from doing laboratory research and into product development. To meet these challenges, we have hired a VP for manufacturing that is located in Bergen that has the overall responsibility for the production setup, and we are also in the phase now where we are hiring a production manager that will be located at our facility in Germany. The question is not if we will manage to do the production.
For us, the question is obviously when we will do it. We have a long tradition in Lifecare to work on very tough timelines, as we also do now. We believe that tough timelines is what drives us forward, so we have a goal to be able to do production at the end of the second quarter, 2024. This is a tough timeline, but we are working hard to manage that. I think this is the last question I have so far, and that is the question of how the veterinary approach will affect the human timeline. I touched on it a bit in the presentation, that we basically are not spending any extra money to do the veterinary approach.
So what we are doing is that we are doing the human approach in terms of the testing we want to do, in terms of the study we want to do, in terms of the production setup that we are planning, and also in terms of the quality management system that we have implemented and are continuing to improve. At the stage when we have the production line set up, we will be ready to do our next clinical test, so the regulatory approach, a big study with some hundred participants that will provide us the data we need to achieve the CE mark to go into the European market.
On this way, on this route, when we already have the production line set up, we will also be able to, in parallel, produce the same units and put those into the veterinary market. This will of course be. There will be some software changes, and it will, I mean, animals are not as humans, so there are some adaptations in terms of the software and the readout and the calculations of the actual glucose level. But on the other hand, the efforts we put in are basically in the human timeline, and we gain the synergies and use them in the veterinary approach. So the answer is that the veterinary approach will not affect the human timeline.
It will only ensure that we are in the market with a product way earlier than what we can be in the human approach. That concludes both my presentation and the Q&A. Thank you very much for tuning in and listening. As always, I encourage anybody to send over the questions you might have after this presentation or later by contacting us directly via phone or via email. Thank you very much, and have a good day.