Welcome to Ascelia Pharma QT 2025 Report Presentation. For the first part of the conference, participants will be in listen-only mode. During the questions and answers session, participants are able to ask questions by dialing pound key five on their telephone keypad. Now, I will hand the conference over to CEO Magnus Corfitzen, CSO Andreas Norlin, and Deputy CEO Julie Waras Brogren. Please go ahead.
Thank you, and welcome everyone to the webcast for Ascelia Pharma 's Q2 Report for 2025. On this call, we will be making a number of forward-looking statements. On today's call, we will start with recent key events and then head into our portfolio update before we move to financials and priorities ahead. After the presentation, we will open up for questions as usual. At Ascelia Pharma , we identify, develop, and commercialize novel drugs that address unmet medical needs within rare cancer conditions. We have two drugs in our pipeline. Orviglance is in the registration phase as we have successfully completed the pivotal phase III clinical study known as the SPARKLE , and we're preparing the NDA submission, which will be submitted soon. Orviglance has orphan drug designation from the FDA and is targeting an addressable market opportunity of $800 million.
Oncoral is ready to start phase II clinical development for the treatment of gastric cancer based on encouraging results in phase I and a high level of unmet medical need. Our company is headquartered in Malmö in Sweden and we're listed on Nasdaq Stockholm. The second quarter of 2025 was focused on finalizing the Orviglance NDA submission, following our meeting with the FDA in Q1. I'd like to briefly mention some of the key highlights. The interest in Orviglance in the scientific and medical community continues, and in April, we announced acceptance of a poster presentation at the ISPO conference about the burden of disease for the Orviglance target patient population. We also announced an Orviglance publication in Investigative Radiology.
This publication is a phase II clinical study where we have used a reader evaluation setup similar to the one we've used in our phase III study, where Orviglance is evaluated alongside an unenhanced and gadolinium-based contrast agent. In connection with the rights issue we did last year, we issued the Tier 1 warrants. The exercise period was in the first half of April this year, and there was strong interest, and 96% of the warrants were utilized, and the gross proceeds for the company were approximately SEK 43 million. Furthermore, we held the annual meeting in May as usual, and the bulletin has been communicated. Last week, we announced that the FDA submission file is essentially complete, and the final electronic configuration known as publishing is expected to be completed in a few weeks, after which the NDA will be submitted to the FDA.
We're pursuing some important value creating opportunities with Orviglance. One part is the timely submission and approval of Orviglance for the optimal label. We've met milestones here in terms of completing the Orviglance clinical study report in early Q4 last year. We also had a meeting with the FDA in Q1, and we are submitting the NDA for filing for approval in a few weeks. The second objective is to progress Orviglance for commercialization, and the activities are to continue to advance our launch readiness activities, including manufacturing and supply chain things and working with the medical community. The other part is entering into a commercialization partnership, and that activity is ongoing. I'm happy with the progress we're making in Ascelia Pharma and the efforts made by our team to ensure we will meet our objectives and create value to shareholders.
Now, we will be moving into the portfolio section of our presentation. We'll start with Orviglance. We're very excited about Orviglance, and here's why. Orviglance is addressing a well-defined unmet medical need for a subgroup of people living with cancer. This is an $800 million global market opportunity, and Orviglance is a first-in-class product to target this, and it has orphan drug designation from the [FDA]. We have strong data from nine clinical studies, including strong phase III data, and the manufacturing has been upscaled to commercial scale. As mentioned, we're a few weeks from submitting the Orviglance New Drug Application to the FDA and look forward to the process towards approval. Now, we'll go further into the Orviglance opportunity, and I'd like to hand it over to Andreas.
Thank you, Magnus. Yeah, so Orviglance is a first-in-class liver MRI contrast agent, which addresses a very specific unmet medical need for which there are no good alternatives available today. Adequate visualization of liver tumors and metastases is critical for making the right treatment decisions, and contrast-enhanced MRI is the gold standard procedure for examination of patients with suspected or known tumors or metastases. The most used contrast agents are all based on the heavy metal gadolinium. In patients with severe kidney impairment, the use of gadolinium-based contrast agents has been associated with an increased risk of a very severe side effect called NSF, nephrogenic systemic fibrosis, which may even have a lethal outcome. Both the European and U.S. regulatory authorities have, for that reason, issued warnings for the use of gadolinium-based contrast agents in this group of patients.
The consequence is that patients with impaired kidney function typically will get an MRI without contrast, which will result in liver images of suboptimal quality with a risk for that their cancer is not managed in the best possible way. We envision that Orviglance, which is based on manganese, will address this unmet medical need and in the future become an efficacious non-gadolinium contrast agent for liver cancer patients with impaired kidney function. We have completed a comprehensive clinical program, including a total of 286 patients and healthy volunteers across nine clinical studies, which consistently have demonstrated positive efficacy and safety of Orviglance. The pivotal study in the development program, the phase III SPARKLE study, clearly demonstrated the superior visualization of focal liver lesions in the target population of patients with severe kidney impairment and an adverse event profile consistent with what we observed in the other studies.
In summary, we are now going to submit the NDA for Orviglance to the FDA. The NDA file, which in addition to the clinical data just mentioned, also includes non-clinical and CMC, the chemistry and manufacturing data, has been completed. After the final step in making the file ready for submission, we are looking very much forward to the submission in early September. I will hand it over to Julie.
Thank you, Andreas. About the commercial potential for Orviglance, the addressable market for Orviglance has a global value of $800 million annually. The U.S. represents almost half of this. This market opportunity for Orviglance addresses the unmet need for a well-defined patient population, cancer patients who need imaging of their liver and who also have severely impaired kidney function. Our strategy for commercialization is to launch through partners. This strategy supports our ambition to secure the optimal balance between future revenues and the investment required. Our focused, ambitious launch strategy and plans are built on advanced market insights and are in place to support this partnering strategy and support the launch. As mentioned, the U.S. is the largest commercial opportunity for Orviglance.
In the U.S. alone, our real-world data, i.e., data from realized procedures in our target patient population, show that every year, 100,000 abdominal imaging procedures are performed in around 50,000 patients that fall under the black box warning for gadolinium-based agents. This is about 4% of people with cancer undergoing abdominal imaging. The well-defined patient population with a clear unmet need also drives an attractive pricing opportunity, and we have extensive input from market access and pricing experts with whom we've tested different pricing levels and collected insights on the evidence needed to support access and reimbursement. We have investigated pricing and access benchmarks of other innovative diagnostic drugs in the U.S. Ninety percent of healthcare professionals are concerned about issues with gadolinium-based agents. This includes the severe side effect associated with our target patient population, NSF. In fact, 16% of providers have experienced cases of NSF in patients exposed to gadolinium.
These insights come from market research with 270 U.S. healthcare professionals and answers from radiologists, nephrologists, and oncologists. These insights confirm the concerns with gadolinium in clinical practice and the unmet need for Orviglance. When speaking to experts, whether in radiology or nephrology, they confirm that an alternative to gadolinium for our target patient population would address concerns of today with the potential to become a very valuable addition to their clinical practice. Beyond the risk of NSF in kidney-impaired patients, gadolinium is well known to be retained in the brain and other tissue in all patients, and scrutiny over the possible safety effects is a key concern of regulatory and medical bodies. It's also well known that gadolinium is excreted via the kidneys in urine. Because it's difficult to remove in our sewage system, it's discharged into the environment and into our drinking water.
There's an urgency to find a viable alternative to the growing use of toxic gadolinium, an alternative that is not associated with these potential safety concerns for patients and for the environment. The industry is responding. Recent developments from the large gadolinium manufacturers are focused on smaller doses of gadolinium, and there's even an early-stage injectable manganese contrast agent, which is not liver-specific like Orviglance. In short, the momentum for an alternative to gadolinium is getting better and better. We are excited that we have a head start and that Orviglance is expected to be a first-in-class to lead a future with less gadolinium and improved outcomes for our target patients. The go-to-market strategy for Orviglance is to launch with commercialization partners, and our dialogue with potential partners continues to progress. This supports our objective to secure the optimal balance between future revenues and the investment required.
This strategy also allows us to leverage commercial capabilities already established by a partner. Our dialogue with these potential partners for successful launch of Orviglance is ongoing and continues to progress. We're also working in parallel to ensure that Orviglance and a partner are ready to launch on approval. For example, we want to ensure that manufacturing is ready for the first product launch. We're excited to see the successful acceptances of SPARKLE data for presentation at major scientific conferences. In total, four oral presentations and five abstract presentations have been accepted at major conferences thus far, underscoring the interest in Orviglance in the medical and scientific community. As Magnus mentioned, we also announced the publication of a scientific article in Investigative Radiology.
This publication presents the outcomes of a phase II study previously conducted at Karolinska Institute, utilizing the same independent reader methodology and approach as our phase III study with Orviglance. The results are consistent with our other studies and show superior visualization and a greater number of detected focal liver lesions with Orviglance compared to unenhanced. It also shows that Orviglance and the gadolinium agent used in the study performed similarly in the visualization and detection of lesions. With this, I will pass it over to Andreas to talk about Oncoral.
Thank you, Julie. Yeah, let's talk about Oncoral, the other assets in our development portfolio. Oncoral is a daily tablet formulation of irinotecan, a well-established intravenous chemotherapeutic agent. A daily tablet formulation enables a frequent low-dose dosing regimen that could offer potential advantages on both efficacy and safety compared to the infrequent high-dose intravenous administration used today. We have completed a phase I study, which demonstrated a promising safety profile and an uptake of the drug after oral dosing consistent with a daily dosing concept. We are now planning to take Oncoral into clinical phase II. The objective is to generate clinical proof of efficacy data in metastatic gastric cancer in combination with Lonsurf, another oral cancer treatment approved for gastric cancer. Animal data has demonstrated a synergistic effect of irinotecan when combined with Lonsurf, which makes this combination very interesting.
The planned phase II study is designed to study Oncoral plus Lonsurf against Lonsurf alone. The study will randomize approximately 100 patients and involves a clinical collaboration with Taiho Oncology, the developer and marketeer of Lonsurf, who will provide clinical advice and Lonsurf for the study. Irinotecan is a well-established chemotherapy with recognized anti-tumor effect in solid tumors. Our strategy is to start Oncoral development in gastric cancer, which is today a $3 billion market. For these patients, there is a high unmet medical need for improving outcomes, and there is an opportunity for an orphan indication. We also see opportunities for developing Oncoral in other solid tumor indications where a daily dosing tablet formulation can demonstrate an attractive efficacy and safety profile. Irinotecan, as an IV formulation, is already approved in colorectal and pancreatic cancer. In addition, irinotecan is clinically demonstrated and recognized in guidelines for other cancer types.
We are assessing these opportunities as part of our ongoing strategic planning for Oncoral. Back to Julie again.
Thank you, Andreas. To round off today's financials and outlook before your questions, in Q2, our operating result was a loss, i.e., cost of SEK 23 million. These costs are at a similar level compared to Q1 2025 with a continuous focus on the NDA submission preparations. At the end of June 2025, we had SEK 60 million in the bank, and we're very pleased, of course, with the successful Tier 1 warrants exercised in April, which brought in SEK 43 million in additional financing before cost at a subscription rate of approximately 96%. After these warrants were exercised, we repaid the SEK 20 million loan from Venya, and our cash runway now is at least the end of 2025. That includes a reserve for potential repayment of this remaining SEK 7.5 million convertible loan with Fenja end of this year. This financial runway excludes any financing from partnering.
To wrap up, we have substantial value creation opportunities ahead for Orviglance and for Ascelia Pharma . With Orviglance, we're bringing to market a first-in-class diagnostic drug addressing an $800 million market for patients with a high unmet need. We have two objectives. One is a timely submission and approval of Orviglance with the optimal label. The key steps on the way are the completion of the SPARKLE clinical study report, a milestone we achieved early November last year, which reinforced the successful study outcomes of the phase III studies, primary and secondary endpoints, and supports the NDA process. In March this year, we communicated positive outcomes from our meeting with the FDA in advance of our NDA submission. We plan to submit the NDA by early September.
Our other objective is to progress Orviglance for commercialization for patients in need by entering into a partnering agreement for the launch and by securing that a partner and Orviglance are ready for launch by approval. All in all, we have progressed well in Q2 2025 with the continued preparations of the NDA submission for Orviglance, and we continue to progress discussions with potential partners for the commercialization of Orviglance. We look very much forward to executing on the opportunities ahead for Orviglance and for Ascelia Pharma in 2025 and beyond. With this, we have completed our presentation. We're ready to take questions.
If you wish to ask a question, please dial pound key five on your telephone keypad to enter the queue. If you wish to withdraw your question, please dial pound key six on your telephone keypad. The next question comes from Johan Unnerus from Redeye. Please go ahead.
Yes, it's Johan Unnerus from Redeye. Thanks for taking our questions. The first one, could you provide perhaps a little bit more detail around the completion of the submission process, the electronic part of the... What does that involve?
Absolutely. Thank you. Hi there. Thanks for the question. The final step of the preparation of an NDA is to make sure that all the documents are in place where they should be. It's quite a complex set of documentation, and the FDA needs to find the right document where they are supposed to find it. That is what we call the publishing procedure to make sure that everything is in place. It's a quite technical and, to be honest, a bit boring thing, but very, very important.
You are obviously confident regarding the framework for the timing and the final stage, total two to three weeks?
Yes, we are.
Very good. Perhaps also you can clarify what the next step in the FDA process is. There will be sort of a submission, preliminary review of the filing, I suppose, sort of some 60 days?
Yeah, the process is the normal process by the FDA. They will get the file, check it in, and make sure it's all in good order. There is this initial step where they review, and then there will be this Day 74 communication where they say, yes, we will continue the review or not.
Thank you. The next step would be the substantial review. Once that's clear, have you considered applying for a priority review?
We have not communicated anything about that. That is part of the submission if you want to do that or not, but we haven't communicated anything.
Yeah, it will be that period will be sort of six to 10 months then, typically, depending on... Yeah, it's very important with the partner discussions that could be related to the filing process, of course. Is it possible to give any flavor if these discussions have sort of intensified now as you're approaching the finishing line?
No, we can't really comment on that. As we're saying, dialogues are progressing and we're happy with the situation that we have. I think we cannot really elaborate more than that.
Okay. The admin cost to move over to the cost side seems to be very stable and under control. Perhaps you could provide a bit more flavor on the R&D side because at this stage, it could involve some external resources and some quarterly, monthly variation, I suppose.
Yeah. As to your question, I mean, we're not commenting on spend moving ahead, only on the runway, as you know. You're right, of course, you can see that there's a big part of the cost in this year so far that are R&D costs. These are, of course, mainly related to the NDA preparations. Now, of course, there is still some preparation of answers and so forth. Yes, there are external costs associated with the NDA preparation.
Presumably, that's the main reason for sort of temporary variation at this stage.
Yeah.
The level of external resources required. I think that's pretty straightforward and all for us at this stage.
Thank you, Johan.
The next question comes from Maria Karlsson Osipova from DNB Carnegie. Please go ahead.
Hello. Thank you for taking my question. It's a very bad thing to go second because you were almost very good with asking many of the things that I was wondering. If we talk a little bit about Oncoral instead, because so much focus is on Orviglance, which is obvious. Looking ahead, how fast can you start with the preparations for that project once you do it? Are we talking months? Are we talking half a year or years? What are we talking about for Oncoral?
It's a good question, and thank you for that. We haven't really communicated exactly how quickly we could, you know, get a study started. I think there will be some, and we mentioned that earlier, that there is some work to get this study, you could say, back in full action. A couple of years ago, because we were seeing extended timelines for Orviglance completion, we sort of paused or halted the initiation of the clinical study for Oncoral. I think that's kind of like a restart of the study in some way or form. We haven't commented on that. It's not something that we can do in a few months after pushing the go button. It's longer than that, for sure.
Yeah, I understand. Thank you. One very last one on the publishing process for the FDA. Are there any other remaining risks or potential delays that can happen? It is a very rigorous and very long process, and as you've mentioned, maybe not the most fun process. Do you see any other risks that are potentially there?
I would say no. We are at the end of the preparation of the file. We are very pleased with the content and the quality of the file, and we have a very strong package. At the moment, it is only, if I may say so, the publishing and this technical part to do. No specific hurdles in the near future, as we can see it.
Yes, thank you. We will be looking forward to following your press releases going forward. That was all from me. Thank you very much.
As a reminder, if you wish to ask a question, please dial the pound key five on your telephone keypad.
We've also received some questions here on the page, and we'll get started on those. One question here is, what would the combined upfront and milestone on approval for Orviglance have to be for you to feel comfortable in restarting the Oncoral program? I think it's hard to be... I think it's an excellent question, but it's also very difficult to give sort of a concrete answer. The governing principle that we have is we want to make sure that we are not taking unnecessary financial risks. That means that we would need to have, you know, an appropriately large upfront and milestone structure for us to restart the program. It's also important to keep in mind that it's not, you know, a massive one-off investment. It's a gradual investment program to get the Oncoral program started.
I think there would probably be good flexibility on moving that one forward with the, you would say, upfront and milestones that we are hoping for. Another question is, what is the regulatory strategy for EU, Japan, and the rest of the world once the file is in for the U.S.? What we said is that we are making the submission in the U.S. That will come in in a few weeks. The rest of the world will be partner-driven. That requires a partnership to be in place before we initiate those processes. We think we create the most value by being successful in the U.S., focusing all our efforts and resources on that. If we succeed there, that's much more valuable than making some progress all over the world. That's our strategy. Another question here is, has the current turbulent environment in the U.S. biotech sector, changes in the FDA, et cetera, impacted also your talk with potential commercialization partners?
Are there increased cautionists among companies? Julie, do you have a comment?
Yes. I think key is that the pharma players are in the industry for the longer time, certainly also our potential partners. The assessment of Orviglance doesn't fall into sort of a short-term evaluation about staff at the FDA. Also, so far, not a lot of companies, to our knowledge, have directly been impacted. The reviewers and so forth at the FDA are still a priority to keep their timelines, even speed them up according to the new administration, or not new anymore. No, we don't see really an impact in that sense because they're looking at the commercial potential in the longer time. On the other hand, a lot of the most gadolinium is manufactured in China. We can see that the gadolinium manufacturers have been impacted, at least in terms of having to implement mitigation strategies for sourcing their gadolinium. They have been busy with that.
The industry still has a lot of value potential and potential matches to their strategy for Orviglance. Do you have one more here?
Yeah. A question here. If you were to sign a letter of intent with a potential partner, would you communicate this to the market?
Is that me?
Yeah, you definitely.
We communicate, of course, when it has a material impact. Any other communication would have to be advantageous for us and for investors. We can't really say I wouldn't. We can't say that we would communicate things like that because there's a lot of uncertainty in a partnering deal until everything is signed. That probably wouldn't make a lot of sense.
A letter of intent is not a final agreement. That would not be communicated. When we have a definitive agreement, that will be communicated.
A company is not in the best negotiation position if any intermediate steps are communicated.
We have another one in Swedish. I will try and do my translation simultaneously in English. It says, if you submit your NDA in September, then it's expected that the FDA will give a priority date in November. The question is whether we have discussed the priority review with the FDA and when the message would come out now or in connection with the priority date.
Excuse me. We haven't communicated anything about priority review yet, as mentioned earlier. This is something that you apply for if you want to do it in connection with a submission. As long as we haven't communicated, I don't think we can say much more than that at this time. The PDUFA date will, of course, say something. The PDUFA date will be communicated by the FDA, yes, and that will, of course, reveal at the latest what the timelines are.
Another question here is if we can sort of elaborate on why we prioritize a partnership instead of building a direct commercial team in the U.S. towards the approximately 400 hospital groups in the U.S. That is the key target group. I think that's one question. Julie, do you want to comment?
I can start. Yeah, our ambition is to balance the optimal investment required with the value and the revenue for Ascelia . When you launch a product, you, of course, have the cost of the sales force and the medical team and the execution. You also have to build a number of capabilities and IT systems and things in the background. An existing pharma company, specialty pharma, would already have many of these capabilities in place. We believe the best strategy for the launch is to work with an organization that has established capabilities for both the optimal overall cost and the optimal cost structure for Ascelia Pharma c ompared to the revenue.
A sort of follow-up question to this one is, in practical terms, what are the biggest obstacles for completing a partnership agreement? I can probably start on that. I think a partnership agreement is obviously a large, complicated agreement, and it requires that the partners also finalize their plans for launching the product. You would say potentially taking a role in the review process if they are having some input to that. I think it's more the notion that it's a lot of documentation. We have completed the development. There's a lot of information for a potential partnership to go through. We are very happy with what we have in terms of the NDA, very happy in terms of the, you could say, the pre-launch activities and documentation we have for that. That's obviously something that a partner will look at.
A question here is, as we are preparing for a potential partner deal or some other form of financing, whether we are changing the quote that it's on the stock. No, we've not done that. A question here, if we can elaborate on how the burn rate will change after the NDA is submitted. The assumption from the person still asking the question is that it will decrease. Julie?
Yes. As you can see in our costs, the first half of the year, a big part is R&D costs, and that's, of course, associated mainly with the NDA preparations and finalization of the file. Also using a lot of external help, and some of these costs will, of course, go away, but there's also costs associated with preparing a review. We're not specifically commenting on our expenditure ahead. There's both costs before and after, but as you can see, a main chunk before.
We have previously communicated that the NDA submission was most likely in the first half of August and that this timeline already included some buffer for unforeseen events. At the same time, you described the pre-NDA meeting as very much aligned with your expectation, with no real surprises. With that context, could you give us some additional color on what actually drove the two to three-week delay? Was it primarily technical details around the final NDA configuration or external consultant partner mix, or was it more about internal prioritization?
Yeah, it's a question for me. I can hear. There's always some, the work has to be done. Of course, we have been focused on getting the right quality and the content right. There are always details that need to be put in place. I think you have probably mentioned all potential or all pieces that have impacted the work here. All in all, we have now the NDA file ready with a good quality. We are at the end of the publishing, or we have started the publishing phase, which is the last step before submission.
We have another question here. More broadly, perhaps companies also choose to adjust the exact timing of a filing, not only for purely technical reasons, but also to make sure there's full alignment with external stakeholders. This could be around labor discussion, commercial preparation, or ensuring that the submission package reflects the latest strategic considerations. Without asking you to comment on any potential partnering specifically, can you elaborate on whether such external alignment or commercial readiness discussions played a role in the timing of your NDA submission? Yeah, that was a good question and a long build-up. I think a good plan always needs to take all stakeholders into account, right? Also, we can't comment on partnering specifics. We're following the plan. I don't put too much into the delay. It's a really significant undertaking to submit an NDA.
We're working with our team of advisors and consultants, and we're a small team here. I'm happy with how the team has worked to ensure we have a very high-quality package. That is how the timeline ultimately ended up. I don't want to—I think our priority is to make sure that what we send to the FDA is the best possible package we can send. That's what we focus on, as well as try to do it as quickly as possible. Having the right one is the most important parameter. There's a question here. I see that you write partnerships with an S. How many partners are you looking for? Would you prefer one global or several regional? It's a good question.
The answer is that we want the right partners for Orviglance, where this would have a good fit in their portfolio, and they would invest significant resources into making Orviglance successful. That would mean both, you know, that investment would both be in the launch and commercialization of the product, but also, obviously, payments to Ascelia to make sure we get our fair share of the value. Whether that's one global or whether it's a couple of, you would say, regional deals, we're flexible on that one. A question here is, given that you're preparing...
[It's the same as...]
What did you say?
[Yeah, I can say that.]
Yeah. If you don't see yourself having the competence for direct launch, have you considered working with a specialized marketing partner to reach the identified hospitals instead of relying solely on the full-scale commercialization partner? Julie, can you add comments to that?
The partnerships can take different forms and shapes, of course. We all know it from industry, anything from acquisition, licensing to models with organizations who have all the capabilities, and you keep a higher share of the revenue because it's in this, as this question alludes to, more of an outsourced model. There are different options. We want the best possible deal. We're looking at everything, but we want, of course, the one that gives us the most value.
Another question here is, can the market expect a partnership agreement to be in place before we enter 2026? I can't really comment on that. If I say, yes, we will absolutely have something before 2026, I put myself in a corner in the negotiation. I don't want to do that. I want to get the right partnership at the right time, whenever that is. That depends on the specific conversation we're having with that specific company. I think that's really the best answer, maybe not the most useful, but I think that's just sharing our objectives in terms of how we think about it.
[I think that's it because of the similar conflicts.]
That concludes the questions. Thank you all for listening in and for all the good questions that we have received here. We're very happy about being able to submit the NDA in a few weeks. It's a major milestone and a fantastic achievement. We're looking forward to the review process and also on progressing the partnership discussions and updating you as whenever relevant milestones occur. Thank you very much and have a great day.