AGM 2023

Apr 27, 2023

Good morning, everyone. My name is Steve Saviuk, CEO of Valeo Pharma Inc. I would like to welcome you to our annual shareholders' meeting, which I now call to order. In accordance with the requirements of the corporation's bylaws, I will act as chairman of this meeting, and I appoint Guy-Paul Allard, Vice President, Legal Affairs and Corporate Secretary of the Corporation, to act as secretary of this meeting. Pina Pacifico and Toni De Luca of Computershare Investor Services, our registrar and transfer agent to act as scrutineers. The directors of the corporation currently are Richard J. MacKay, Steve Saviuk, Frederic Fasano, Michel Trudeau, Vincent Hogue, Maureen Brennan, Marc Léger. Apart from myself, Richard J. MacKay, Michel Trudeau, Maureen Brennan, Marc Léger, and Vincent Hogue are present for this annual meeting. Notice of this meeting was published and the notice calling this meeting and the management information circular and proxy forms were mailed to shareholders, and I have received a statutory declaration attesting to the publication and an affidavit attesting to the mailing. Accordingly, with the consent of the meeting, we will dispense with the reading of the notice, and I direct the secretary to attach the declaration and affidavit to the minutes of this meeting. I now ask the scrutineers to submit their report on attendance. Mr. Chairman, we, the scrutineers, report that there are registered shareholders and their proxy holders present at this meeting, representing in person or by proxy 37.76% of the total eligible votes at this meeting. Thank you. The scrutineers report is complete and a quorum is present. I therefore declare this meeting to be properly constituted for the transaction of business. I would like to remind everyone that only registered shareholders or proxy holders can move or second motions or vote at this meeting. Registered shareholders and proxy holders may ask questions or make comments. Before asking questions, please identify yourself by name. The first item of business is the presentation of the annual audited financial statements for the fiscal year ended October 31, 2022, and the auditor's report thereon. The annual report was mailed with a notice of this meeting and other documentation to each registered shareholder and, in the case of intermediaries, in the number of copies required by them. Extra copies are available should anyone so require. Are there any questions on the financial statements or auditor's report? I will now entertain a motion to dispense with the reading of the annual report and to receive the annual report, the financial statements, and the auditor's report thereon. My name is Luc Mainville, and I move that the reading of the annual report be dispensed with, and that the annual report, the financial statements, and the auditor's report of the corporation as at October thirty-first, two thousand twenty-two, be received. My name is Frederic Dumais, and I second the motion. Is there any discussion on the motion? Being that there is not, I declare the motion carried. Election of directors. The next item of business is the election of directors to hold office until the next annual meeting of shareholders. The management information circular sent to shareholders prior to this meeting refers to the election of six directors to be elected, and I declare the meeting open for nominations. My name is Luc Mainville, and I nominate the following to serve as directors of the corporation for the ensuing year. Mr. Richard MacKay, Mr. Steve Saviuk, Mr. Michel Trudeau, Mrs. Maureen Brennan, Mr. Marc Léger, and Mr. Stuart Fowler. Are there any further nominations? There being no further nominations, I will entertain a motion for the closing of the nominations for director. My name is Luc Mainville, and I move that nominations for directors of the corporation be closed, and that the six persons whose names have been read to this meeting be elected as directors of the corporation to hold office until the next annual meeting of shareholders or until their successors are elected or appointed. My name is Frederic Dumais, and I second the motion. Is there any discussion on the motion? I am advised by the scrutineer that management has received proxies representing more than 97.2% of the votes cast in favor of the election of each nominee. I declare the motion carried. Therefore, Richard MacKay, Steve Saviuk, Michel Trudeau, Maureen Brennan, Marc Léger, and Stuart Fowler are elected directors of the corporation to hold office until the next annual meeting of shareholders or until their successors are elected or appointed. The next item of business is the appointment of auditors. Does anyone have a motion in this regard? My name is Luc Mainville, and I move that PricewaterhouseCoopers LLP be appointed auditors of the corporation to hold office until the next annual meeting of shareholders, and that their remuneration be fixed by the board of directors of the corporation. My name is Frederic Dumais, and I second the motion. Is there any discussion on the motion? I am advised by the scrutineer that management has received proxies representing 100% of the votes cast in favor of this resolution. I declare the motion carried. Therefore, PricewaterhouseCoopers LLP are appointed as auditors of the Corporation until the close of the next annual meeting of shareholders, and that their remuneration be fixed by the board. Ladies and gentlemen, that concludes the business for which this meeting was called. After the meeting, we will give a presentation on the company's activities and answer any questions that you may have. Does anyone have any further business to come before this meeting before the meeting is adjourned? There being no further business to come before this meeting, I will now entertain a motion for the adjournment of the meeting. My name is Luc Mainville, and I move that this meeting be adjourned. My name is Frederic Dumais, and I second the motion. All in favor? Any against? Motion carried. The meeting is now adjourned. Thank you, Steve. This concludes the formal part of our presentation. We will now move to the corporate presentation section. Please go ahead, Steve. Well, welcome again, and it gives me a pleasure to provide a background on Valeo Pharma 2020-2022 review and the outlook for 2023. As many of you know, Valeo Pharma is a fully integrated commercial pharmaceutical company based in Montreal with a focus on the Canadian marketplace. We currently have approximately 130 employees, two-thirds of which, or over two-thirds of which are part of our pan-Canadian sales force. We're listed on the TSX in Canada and the OTCQB in the U.S. Our primary business model relates to the licensing and acquisition of the Canadian rights of commercial stage prescription drugs. In other words, no R&D, clinical trial, risk exposure, or financing requirements for Valeo. Again, we are looking for innovative, and when we talk about innovative drugs, we talk about drugs that have patent protection in Canada and that also provide a therapeutic benefit to caregivers and patients in Canada. We currently have 12 commercialized products, six of which we consider our core or high growth products, and these six are the ones that receive the full complement of our commercial activities and the 85+ Canadian sales reps that we have in Canada. We have an interesting portfolio with peak sales potential that currently exceeds CAD 230 million. Over the last 3 years, our revenues have grown by a factor of over 8. Next slide, Trent. We're segregated into three therapeutic areas, respiratory allergy, ophthalmology, and specialty hospital. Within the respiratory portfolio, our three key products are Advair and Atectura for asthma and Allerject for severe allergic reactions. Ophthalmology, a relatively new area that we entered into, we acquired last summer at the end of July. We have two products, Xiidra for dry eye and Simbrinza for glaucoma, and we'll get into further detail on these products in ensuing slides. On the hospital side, we have a number of products, primarily, and the leader of which is Redesca, a low molecular weight heparin or a blood thinner used within the hospital. Next slide, Trent. Our milestones for the fiscal 2022 and beginning of 2023. In Q1 of 2022, we completed a CAD 25 million convertible debenture private placement, which was led by Investissement Québec and a number of institutional shareholders. In Q2 of 2022, we listed our common shares on the Toronto Stock Exchange, the big board. Q3 of 2022, we acquired several products, two of which were Xiidra and Simbrinza that create the foundation of our ophthalmic portfolio. At the same time, Allerject, a severe allergy product that we've added to our respiratory portfolio. During the quarter, we also secured a $40 million USD facility from Sagard Healthcare Partners, of which we've drawn $30 million. In Q4, we welcomed our new Chief Commercial Officer, Kyle Steiger. We created a new ophthalmology business unit to support and commercialize the two products, Xiidra and Simbrinza, that we'd acquired in July or at the end of July. We also reported record revenues of CAD 27.7 million for the year, and we followed that up in the first quarter with another record in terms of record quarterly revenues of CAD 13.2 million. Next slide, Trent. This is a representation of our revenues over the course of from fiscal 2020 onwards. Just remind everyone that we do have an October year-end. The colored bars represent the three various therapeutic areas or therapeutic focuses that we have. What you can see is the specialty hospital group was the mainstay of our business in fiscal 2020, where our revenues were about CAD 7.5 million. 2021 also, where our revenues grew to CAD 13.6 million. In fiscal 2022, we started to see the emergence of the ophthalmology and the respiratory units. While we foresee that the specialty and hospital business will continue to grow, they will do so at a much slower pace than these other newer business units where the bulk of our growth will reside. We're projecting over CAD 60+ million of revenue this year, and as you can see by the graphs here, ophthalmology will be one of the key drivers in that revenue forecast. The green bar or the green section representing respiratory will grow as years go on. If you see 2024 and 2025, you can see that the green bar is showing a significant growth. When you look forward to our company, the first driver of revenue growth will be the respiratory area, the second driver will be ophthalmology, and the third driver will be specialty hospital. What I would like to reiterate is that's based on the products that we have today. We certainly will talk about some of our business development activities, and where we foresee future products which could change these bars in terms of a positive way for this year and for future years. Next slide, Trent. With this is an interesting slide in that it really looks at our what we call our big six products. If you discard the others on the bottom, which you can see are fairly advanced in terms of reaching their maximum sales potential. The top six products from the top Enerzair, Atectura in asthma, Allerject in allergy, Xiidra and Simbrinza in ophthalmology, and Redesca in hematology or in the hospital. You can see that there is quite a significant growth potential. Specifically when we look at the respiratory portfolio, Enerzair, Atectura, and Allerject. These are where we see a large percentage of our growth coming in the years to come, with Enerzair projected to reach sales in the vicinity of CAD 80 million-CAD 100+ million. That's a large product for Canada, and we'll explain to you in the ensuing slides why we believe that Enerzair has such great potential. As you can see from here, you have six growth products, all of which are at different stages in their life cycle in terms of reaching peak, but all have that strong revenue growth potential. Next slide, Trent. We'll talk to you now about our respiratory allergy business unit. Based on the milestones for the past year were, very importantly, we received full reimbursement, full public reimbursement secured for Enerzair and Atectura. For drugs in Canada, especially drugs that are used outside of the hospital, public reimbursement or provincial reimbursement is a critical element. To have secured in a relatively quick fashion, the full reimbursement for these two products is key to their commercial success. We are now covered in all provinces in Canada and certain other jurisdictions within Canada, for instance, the military. We also have virtually 100% coverage from private payers. In Q4, we entered into a licensing agreement with a U.S. company called Kaléo for a product called Allerject. Allerject is an auto-injector used to inject epinephrine in patients that suffer from anaphylaxis or anaphylactic shock. Could be a peanut allergy, of shellfish, bee sting, what have you. We see a lot of potential in this product in Canada. Other more kind of information in terms of our activities for fiscal year 2022. As you remember, fiscal year 2022, we're still dealing with the back end of COVID and the COVID restrictions in terms of access to physicians and patient access to physicians. Nevertheless, in the fiscal year, we had over 47,000 healthcare professional interactions. We have a sales team of about 60 people in our respiratory group. Our salespeople are segregated based on therapeutic focus. We have respiratory specialists, we have specialists in ophthalmology, and then we have the account managers which deal with the hospital. 47,000 interactions is a significant amount for our group, and we expect to have about the same amount this year. From our perspective, it is truly the only way of imparting medical knowledge to healthcare professionals to allow them to better choose treatment options for their patients. We also conducted 188 learning activities, and these are activities where we have physicians that have a deeper knowledge of some of our products that actually will meet with primary care physicians, generally speaking, and explain treatment protocols or the advancement of treatment protocols, specifically as they relate to Enerzair and Atectura. In Q1 of 2023, we relaunched Allerject, which had been off the market prior to our acquisition. Next slide, please. Let's talk about Enerzair and Atectura. As I mentioned in the first slide, and if you can see, you saw from those horizontal bars, we're really scratching the surface in terms of the revenue potential of these products. The basis around this scratching the surface and the potential has to do with the market that they address. Almost 10% of Canadians suffer from some degree of asthma, and 1 million of which are our targeted patient population, which are moderate to severe asthma sufferers. Now, one statistic that has become clear, whether speaking to physicians or through various industry or trade or therapy groups such as Asthma Canada, what have you, is that over 50% of asthma sufferers feel that their symptoms are not controlled, that they're not happy with the control of their asthma symptoms. As you know, asthma is not a curable disease at this point in time. It's a treatable disease. You treat symptoms and you manage symptoms. The market for asthma therapies in Canada is very large. It's approximately CAD 800 million. It's divided into a number of categories. We won't go into specifics, but they talk about the single agent market, the dual agent market, and the triple agent market. Our products address the bottom two markets. As you can see here, those bottom two markets are approximately CAD 550 million-CAD 600 million. These are big markets, and these are not necessarily expensive therapies. Enerzair is available for approximately CAD 100 per month. Very economical therapy to treat patients, but it has significant medical benefits over the existing drugs in the market. Enerzair is referred to as a triple therapy. A triple therapy, it's the first of its kind, by the way, launched in Canada. It essentially means that it has three fixed chemical entities to deal with asthma, both from an inflammation point of view and from a relaxation dilation point of view. Atectura is more conventional therapy with two agents. What excites us not only is the size of this market, but is the clinical results. As you know, we partnered with Novartis to launch these products in Canada. Novartis did an excellent job of providing and conducting the clinical trials over several years, including several sites in Canada. Next slide. A little bit more on Enerzair and Atectura. Obviously, Enerzair is what we believe one of the key revenue drivers for our product. The products were essentially launched by us about 18 months ago with our full sales force of about 60 sales reps. The key learnings from the product in terms of a clinical perspective is a significant improvement in symptom management compared to Advair in the clinical trials that Novartis conducted. One statistic you can see here is a significant reduction in exacerbations or what is known as asthma attacks. There are a number of other features in terms of improvement of lung function, the reduction of other symptoms such as wheezing, tightness of chest, and coughing that lead some of the key respirologists in Canada to believe that Enerzair is the primary and number one inhaled asthma therapy on the market today. Next slide, Fran. How are we doing in this market? As I mentioned earlier, we launched these products about 18 months ago with a full sales complement. As you know, it takes time. Statistically, it takes anywhere from 6-10 visits to a physician before they write their first prescription. The process is imparting information to physicians, making them aware of the product, but also having key opinion leaders meet with physicians and discuss the treatment protocols and how treatment protocols are evolving and the benefits of using products such as Enerzair. On the left, you look at the total number of prescribers. As of the end of February, we had over 1,700 prescribers. At the end of March, unfortunately, we couldn't update these graphs. The data just came in too recently. We're over 1,900 Canadian prescribers. That's out of a pool that we're targeting of almost 14,000. You can see we're just scratching the number of doctors that have actually engaged and are starting to write prescriptions on Enerzair. What's also important is looking at the purple and the yellow bars. The purple bars represent the specialists that we call upon, the specialist doctors and primarily respirologists, allergists, and pediatricians. These are in that specialty group of which our target audience is approximately 2,000. You have the yellow bar, which is the general practitioners or the family medicine practitioners. The key there is this is where the bulk of asthma prescriptions are written. While the specialists are engaged initially and are the early adopters and direct the treatment protocols, ultimately it trickles down to the family practitioners, the general practitioners. What's also of note is amongst respirologists, which arguably are at the top of the treatment protocol, if you look at that pyramid where the respirologists are the key specialists, and then you have the general practitioners underneath. We're the number one brand recommended by respirologists in Canada. Now the challenge for Valeo is to move that knowledge to this big base of general practitioners across Canada. That takes time, but we're having a lot of success, as you can see by these yellow bars here in achieving our goals. Secondly, number of prescriptions. Again, end of February, 37.5 million. End of March, over 42,000. Sorry, I said million. It's thousands, total prescriptions. The differentiation between the purple and the gold is the units of Enerzair in purple and Atectura in gold. As would be expected, Enerzair will dominate the market in terms of number of units as time goes on. Rounding out our portfolio in respiratory and allergy, and as you saw from some of the earlier slides, in ensuing years, we believe that this therapeutic area will be the biggest revenue driver for us, representing approximately 50% of our revenues. In the summer of 2022, we entered into an agreement with Kaléo to acquire the Canadian rights to Allerject, which is an auto-injector for the delivery of epinephrine. Our main competition is EpiPen. The market is approximately 80 million and is growing. It's growing approximately 5 million per year. It's an interesting market for us. The main advantages are not the therapy. Both products deliver epinephrine. Both products are priced just roughly the same. They are exactly the same for that matter. Reimbursement, the same. The real differentiator is the delivery device. The Allerject delivery device has a number of beneficial features. Number one, it's small and easy to carry. Number two, it's voice activated. Number three, it has a very strong reliability rating. The only auto-injector in the U.S. that actually meets the FDA guidance for device reliability. It has a number of advantages, we believe, over the EpiPen. When we acquired the product last summer, it had a small run rate of slightly less than CAD 4 million. I can say that as of today, the run rate has jumped about 50% despite the fact that we haven't fully commercialized the product yet. The full commercialization in terms of our social media programs and other programs that we're undertaking will only start in the month of May. Next slide, please. Let's talk about our ophthalmology business unit. This was in Q3 of 2022, we entered into an agreement with Novartis to license Xiidra and Simbrinza. We'll talk a little bit more about what these drugs do, but these are our key drugs in the ophthalmologist's armament of therapies used for front of eye illnesses. During that ensuing quarter, we recruited and staffed our ophthalmology commercial team. This is a team of less than 20 individuals, which includes a full national sales team, product manager, business unit head, and regional sales directors. During the quarter, we relaunched Xiidra and Simbrinza. These products had been commercialized by Novartis, but had not been actively supported in the field for a period of time. We reengaged the Canadian ophthalmology community with the launch, and that included sampling, product information, and other product support. For this year, our commercial team is expected to conduct over 14,000 healthcare professional engagements. Given the fact that there's about 1,200 ophthalmologists in Canada and several thousand optometrists that we will focus on, you can see that this is quite a complete coverage of that community. Next slide, Fred. The two products that we licensed in that really formed the foundation of our ophthalmic division and our views on ophthalmology are Xiidra for dry eye and Simbrinza. Both of these are well-respected products. Both are patented products. As you can see on the left is Xiidra for dry eye. We have approximately 25% market share in this CAD 80 million market, and we expect to be able to grow that share with our sampling efforts and other support efforts at the ophthalmic level or with the ophthalmologist, I should say. Simbrinza is one of the gold standards in terms of glaucoma treatment. It's a small segment of the overall glaucoma market. The overall glaucoma market is about CAD 275 million. The dual combination that we have within Simbrinza, it operates in a market that's approximately CAD 60 million. Again, we have an 18% market share. That market share has grown since we've taken the product on, even though our sales force has only gone live in mid-November. We can talk about having only five months of real field activity, but we expect that product to grow. Both products, we believe we can double market share over a period of approximately four years. Fred, next slide. Fred? Here you can see where the revenues are. In 2023, we expect revenues to come in in the mid-20s CAD million. We expect to almost double those sales by 2028. Just before I start on the specialty products, one thing I would like to say about ophthalmology is we believe that we have tremendous opportunities to expand our ophthalmology portfolio. We're spending a lot of time in business development on this area. The ophthalmic area lends itself to a portfolio approach of product introduction and a product commercialization. This is one of our main business development and focus areas, both for existing products within the ophthalmic space. These are products that could be immediately accretive as well as for development assets which are products that can be registered and launched in Canada over the course of the next two to four years. Our last area is not necessarily a therapeutic area. We call it our specialty business. It involves a number of different products, some of which are quite small. The leading product in this area is in hematology. It's a product called Redesca. Fred, we'll move to the next slide. Before we get into that, sorry. We'll get into the milestones. Key here, well, talking about Redesca, which is the biggest product in that portfolio and is growing sales. We expect sales to top out in the CAD 25 million range. We're about 50% of the way there. We launched this product two years ago with public reimbursement. As I mentioned earlier, public reimbursement is a key tenet for products that have an out-of-hospital use. We receive full reimbursement across Canada for Redesca. We're also now the number one. Redesca is termed a biosimilar, so it's biologically similar to the innovative biologic, and we're the number one biosimilar in both retail and in hospital in Canada. Also in Q2 of 2023, what was very interesting is we finally received public reimbursement for Onstryv in Quebec. For those of you who have followed us for a number of years, you may remember that Onstryv is for the treatment of Parkinson's disease, and it was one of our early products that we had. Unfortunately, we don't have reimbursement yet in the rest of Canada. The Quebec reimbursement was delayed for over two years because of COVID and how COVID affected the healthcare system and approval process in Canada. We're very happy to be able to tell people that suffer, patients that suffer from Parkinson's disease in Quebec that it is now fully reimbursed by the Quebec government. Next slide. Getting back to Redesca, which is our biggest product within that therapeutic or within that specialty group. Redesca is number one market share leader. We have approximately 50% of the market share. If you look at our target market, this target market is about CAD 180 million. It has many segments, but we believe that Redesca can play, can be marketed, and can be successful in all of those segments. Currently, as I mentioned, sales are in the CAD 12 million range. We do expect those sales to increase. There is competition both from the innovative products in the segment as well as currently two other biosimilars. Our marketing team has done an excellent job at placing Redesca in a number of hospitals across Canada. In addition to being, we are number one in the province of Quebec. What's also interesting is in the whole biosimilar access area is the fact that Ontario has been relatively slow in, and we're not just talking about Enoxaparin, we can talk about all biosimilars that are in the market for other medical needs. Ontario has been the last province to actually introduce a biosimilar policy, and these policies typically favor the biosimilar over the incumbent innovative biologic once the biologic is off patent. With the opening of this Ontario market, which will happen on April 1st, we expect that it'll take time, that will generate the availability of additional market dollars, if you will, for us and for our competitors. We look forward to the next couple of years and introducing Redesca into Ontario on a consistent basis. Next slide. I'd like to review some of our financials and provide a year-end summary here. Fred, next slide. A very interesting graph put together by our CFO. A lot of information in a small space, but I'll try to explain it and make it as clear as possible. The purple lines represent our revenue, and as you can see, we have five consecutive quarters of revenue growth, fueled both organically and through acquisition. The red lines represent our EBITDA loss, and as you can see also, five consecutive quarters of EBITDA loss, and we expect that to continue. We expect to be EBITDA positive by the end of our fiscal year, which is October. We expect our revenues to continue to grow this year with a target revenue base of CAD 60+ million, and we believe we're well on our way to achieving that. One of the metrics or one of the illustrations on this graph that is really key is this yellow bar. The yellow bar being our operating expenses. Our operating expenses, you can see that in Q3 2021, or actually in Q2 2021, started to grow. That was around the time that we entered into our initial licensing agreement with Novartis for Enerzair and Atectura. What we engaged on at that time is to significantly increase the number of people that work for Valeo, and specifically on the commercial side. If you look at Q1, Q2 2021, we were maybe 30 employees, and we had to grow the business to what is today about 130 employees to support the launches of these products. There you see that fast-growing yellow line going up as we start to engage with the hiring process. Subsequently, you see the line starting to go down as the initial launch costs are absorbed and our one-time cost. A slight rise in Q4 2022 as we put in place our ophthalmic team. Again, you can see a little drop in Q1 2023. What we expect to see going forward is that yellow line will be essentially flat. It'll have flattened out. The beauty of the Valeo business model is that as revenues grow, expenses do not. This operating leverage is key to generating the positive EBITDA that we expect to attain by the end of the year, as well as positive cash flow, which we expect to reach sometime mid-2024. Next slide, Fred. A bit about our capital structure. We have 84 million shares outstanding. Many people on this call, obviously everyone on this call owns some small part of it, or some large part of it. Management and insiders, what truly sets us apart, and we just returned last night from the Bloomberg Healthcare Conference, which is the largest healthcare conference in Canada and was attended by 1,300 attendees this year, which is an all-time record for the Bloomberg conference. There's definitely a sense that a lot of eyes are starting to turn to healthcare pharma companies, biotech companies. One statistic that rang true is of all these companies, no one has the type of inside ownership that we have. We have over 50% of our shares are owned by the board, by management, by our employees. What investors like about that statistic is that it really aligns our interests with their interests. I think that is something that cannot be overemphasized. We have in our cap table here, you can see we have two classes of debentures. We have a class of CAD 25 million of debentures, which we talked about earlier in terms of having completed that financing. Again, held by Investissement Québec to the extent of CAD 10 million, friends and family and insiders, approximately CAD 5 million in institutional shareholders, another CAD 10 million that's due in December 31st, 2024. We do have a US dollar denominated debt with Sagard Healthcare Partners of approximately $30 million, which was used to fund the acquisition of our ophthalmic portfolio and to build the working capital required to support that portfolio. We believe that the convertible debentures due December 31st, 2024, can be funded to a large extent by our positive cash flow, which we'll be generating at that time. At the end of Q1, we had a cash balance of CAD 11 million. Q2's cash balance should be just marginally lower than that number. The other thing we've been able to accomplish, and to a large extent, thanks to Frederic Dumais, our VP of Corporate Communications and Investor Relations, we have three analysts that currently cover us, the most recent of which is Stefan Quenneville from Echelon. All of them have put out research reports. All of them are rating our securities as buy, with targets that are significantly higher than where they are today. Fred, next one. Upcoming milestones, upcoming events that you should mark on your calendars and look out for. Obviously, getting to that adjusted EBITDA breakeven, a key metric for us. Again, meeting numerous institutional investors over the course of the last two days, all of them looking forward to us hitting that number. It's really a turning point for our company. A lot of focus internally on getting to that positive EBITDA number. We do expect to be able to in-license additional Canadian rights. As you've seen over the last 36 months, we've been quite successful in that area, and we continue to be able to do so. We do believe we have a leverageable business model, a leverageable team, where we could, in certain areas, add more products. I'd look at those areas as specifically in ophthalmology and in the hospital. We're expecting revenue growth for fiscal 2023 to be in excess of 100% higher than 2022, where we reached CAD 28 million, and we're well on our way to getting to that 100% revenue growth. Next slide, Fred. Our investment summary that I'd like to leave you with, where big top-line growth 2023 and beyond, as you saw in some of the earlier slides in terms of the revenue potential, where we have a lot of upside on all of our core commercial products. We're a commercially focused company, so that entails no research and development spending and risk, no clinical trials support. The key for us is our entire team. Although we're a full service integrated team, and that goes all the way from medical to regulatory to market access. Everyone in our company is aligned and focused on supporting our commercial team in the field to drive sales. We believe we're one of the top commercial companies in Canada, both from a growth perspective and from an ability to support product perspective. Six growth assets, so a very diversified portfolio, and as you saw earlier, very different growth paths, but all six of these products can grow. Peak sales, we look at what if all these products hit the levels that we expect them to hit, we'd be well over CAD 200 million in revenue, again, with just our existing portfolio. Significant operating leverage. Operating leverage, as our CFO likes to define, is increase in revenue, increase in margins, nominal increase in cost. We have active BD&L efforts or business development licensing efforts for additional products. As I mentioned, both that can be immediately accretive, in other words, hit our P&L this year, as well as development assets for the coming years to build out our pipeline. With that concludes the presentation portion of today's meeting. We'd like to open the floor to questions and answers. Fred, maybe you can just describe how people can provide their questions. Thank you, Steve, for this great presentation and review of our performance. Ladies and gentlemen, this concludes the corporate presentation portion of our call. You may now ask questions using the Q&A function at the bottom of your screen. Steve, first question is, given that the Redesca product comes from a Chinese pharmaceutical company, with the ongoing political chill between the West and China, what is Valeo's strategy to reduce the risk of losing this product from its portfolio? Yes. A good question. What we can say is, if we take a step back, is the overall market and the overall implication of China in the world healthcare system from the point of view of providing not only finished products but active pharmaceutical ingredients. Clearly, over the years, if I had to pick two areas, both India and China have taken on an increasingly important role in providing basic drugs to the West, to Europe, to North America. This is significant. I think that should there be a strong chill between China and North America, I submit number one, that the healthcare on two bases. Number one, that it actually provides life-saving, in many cases, medication. Number two, represents a significant export market for the Chinese which has high value add, I would say. I do not see that these would be among the first products that could be sanctioned. Frankly, looking at it as just a consumer and then as a person who takes medicine, who takes medication, it would be a scary time for all of Europe and North America if for some reason we are not able to access, whether it be raw chemical ingredients or finished dose products from China. I don't believe that there's a strong or a big risk for these factors in China, that this law would extend to the pharmaceutical industry. Thank you, Steve. Next question is, we've seen Valeo very successful in adding products to its product portfolio in the past couple of years. When can we expect to see more products being added, and is there a specific or particular therapeutic field that is targeted? Yeah. Our research and development, if you will, is business development, is in licensing products. As I mentioned earlier, we do not spend money on research and development. All pharmaceutical companies, whether they be the multinationals or smaller companies, are on the constant lookout for new products, and that's no different at Valeo. We do see significant organic growth as I've been able to illustrate earlier with those horizontal bars which show that there's a lot of potential. That does not mean that we're sitting on these products or sitting on our laurels and say, "We have enough. We don't have to add more." You are always looking to increase your pipeline in the therapeutic areas that you're focusing on. I would say the focus for us is respiratory, ophthalmology, and to some degree, the hospital with specific hospital products. That's number one, in terms of we are looking. Number two, I would say that we're looking for two types of products. Ones that are immediately accretive, and I would think that two-thirds of our efforts are in the products that could drive revenue in the quarter after we acquire them. The other third would be development assets. Assets where you acquire them, you register them with Health Canada. There's a longer cycle before these products come to market, but it's a necessary cycle. We have ongoing discussions in both of those areas. I would love to be able to say next month we're going to have new products. I know we are in active discussions on a number of fronts, and my expectation is, between now and the end of the year, that we will have some additional products that will join our portfolio. That's about as much as I can say now. The activity level and our interest in acquiring more products is very, very high. Thank you, Steve. Another question that is being mentioned quite often is that given all the operational leverage that we have with our corporate structure, how many other products can this really accommodate without increasing significantly our cost structures? Can you give a bit more color as to what this could represent to Valeo's top line and bottom line? Well, if I look at the top line as we looked earlier when we looked at our peak sales of well over CAD 200 million. Getting to that level with our existing products would not require significant increase in operating costs. It would not. In other words, as sales grow in a specific area, let's take respiratory for instance, we expect sales to grow significantly. The number of our field team wouldn't necessarily need to grow to be able to support that additional revenue. Basically our OPEX cost should stay relatively flat well into that CAD 200 million range. I mean, you would add possibly some support in the internal area, and this would be support from maybe a regulatory perspective, a little bit in the warehouse and billing systems, maybe in accounting. These are not significant costs vis-à-vis the growth in revenue. That's where we talk about a leverageable operating structure that we could support significantly higher revenue with our existing team. In terms of adding products, if I had to go through the therapeutics areas, we probably will not add anything in respiratory for some time. We are sitting on some great assets there, and the focus of our team really has to be on Enerzair and Atectura. In the ophthalmology area, the area lends itself to acquiring more products. Why? Ophthalmologists do prefer a portfolio approach when you can actually go into an ophthalmologist and say, "Let's talk about glaucoma. We have first-line treatment. We have second-line treatment. We have combination treatment." That really satisfies or fulfills their needs for their prescription requirements. We think there's a lot more that can be done in ophthalmology in terms of adding products. I can't say a specific number. It wouldn't be 20, but certainly we could probably add 5, 6, 7 products, and through rotation, we'd be easily able to support those. In the hospital, our efforts are really focused around Redesca. As Redesca starts to mature, clearly this 11-person key account management team, which calls on over 240 hospitals across Canada, has the capacity and the network to be able to introduce other drugs in the hospital. I'd say that there's quite a bit of leverage at this point in time. Our focus, again, is on not trying to be everything to everyone, but really focusing on where we've developed real inroads with the healthcare professionals and a strong presence in those specific areas. Thank you, Steve. Another question here is, now that private and public reimbursement has been achieved for your asthma assets, is there anything else that we can look forward to that could positively influence the sales figures or your performance? Is there anything else that needs to be done by Valeo to get to peak sales? Well, on the asthma side, I think it's just execution. As I mentioned earlier, it's the number of physician visits you have to make to basically transfer the medical knowledge and support the healthcare professional prior to he or her supporting your drug through prescription. We're following a path that many other successful drugs in Canada have followed. It takes time. It's visit by visit, and as you saw earlier in the presentation, 47,000 visits last year, interactions, which will be roughly the same number. We'll continue that process this year. Strong KOL participation, and they play a key role in being able to discuss with family practitioners the role that Intercepta can play in the treatment of their patients, what type of patients that they should be looking at. I think we just have to keep doing what we're doing. We've certainly tweaked from day one some of our activities to focus more on those that have been more successful and more informative than as compared to others. To me, it's time. It's just the execution. It's the day-to-day visits. We have a great team of people and very dedicated. As I mentioned earlier, these are all Valeo employees. They have Valeo's interests at heart, as do we. I think that's really key in terms of being able to support products in the field. Thank you, Steve. Another question here. Are you still targeting breakeven, as you've mentioned, towards the end of the year? Can you be a bit more precise whether it's the last month of the quarter, it's the quarter in its entirety? Well, as a growing company, there's a lot of factors at play here. In terms of some revenues happen a little earlier than you expect, some revenues happen a little later. We have some products that have better margins than other products. Our newer products are certainly stronger margin products than, let's say, our legacy assets. The best that we can say from our tracking right now is in the last couple of months of fiscal 2023, that we would break even on an EBITDA basis on a monthly perspective. I think that's a target that certainly we have internally. I think it's important to have targets. It's important to have goals that require a lot of effort to meet, but we believe strongly we'll be able to do so. Clearly, EBITDA breakeven is just the first step. The second step is cash flow breakeven, and we expect that during 2024. Again, a lot of our activities are around ensuring that we're as frugal as we can be in terms of spending our cash and that we maximize our commercial activities to help to build our margins. It's a twofold cost flattening, which you've seen in some of the graphs, and margin expansion, which you've also seen. We believe that those two will intersect in 2024, and we will become a cash flow positive company. As I mentioned, half a dozen institutional investors have talked to me over the last two days or talked to us because you were with me, Fred, saying that's a turning point for your company. That's a turning point for how institutional investors will look at your company. From an operational perspective, it's very important to get the cash flow breakeven, but also from an equity perspective and a market valuation perspective, it's very important. Thank you, Steve. At this point in time, we do not seem to have any additional questions. Just a quick reminder to everyone, if you want to ask questions, you can use the Q&A feature at the bottom of your screen, and please identify yourself while doing so. Petit rappel, si vous voulez poser des questions, vous pouvez utiliser la fonctionnalité Q&A au bas de votre page et veuillez vous identifier en posant votre question. [/Foreign language] We do not have any additional questions, Steve. You can proceed with closing remarks. Well, I'd like to thank everyone again. When I say thank, I thank our employees, I thank our shareholders, the healthcare community that supports us. I think it's a very important factor that all our stakeholders be successful. We look forward to seeing you at the first quarter meeting, which should happen with first quarter results sometime in mid-June. The date I don't think has been specifically set yet. Until that time, as you know, we have a very open policy in terms of very transparent. Contact myself, contact Fred. If you have any questions that come up between now and then, we'll be very happy to talk to you and to deal with you. Again, thanks for supporting Valeo and look forward to seeing you soon.