Thank you very much for that, Mark, and welcome everyone to this Q3 interim report presentation. If we move into the second slide, we have the presenters of today. It's me, Anders Rylander, CEO of the company, and together with me, I have EVP and CFO, Cecilia Driving, and Warren Cresswell, President of Biovica Americas, that will also support me and makes part of this presentation. If we move forward to the third slide, you have the agenda for today. I will start to make a very short introduction about the company and our product. We'll quickly move into the quarter, the report and the highlights. We'll dive deeper into two topics that we've selected, the FDA status and give an update on that.
Warren will go through our US go-to-market strategy and how we intend to move ahead there. Then Cecilia will give us an update on the financial before I summarize, and we open up for a Q&A session. With that said, I think we should move into slide number four, which is a slide of our chip and our product, DiviTum. The product DiviTum stands for dividing tumor, which gives some guidance on what we do. We measure cell proliferation, and we do that from a simple blood sample. As you all know, cell proliferation is what defines cancer growth or uncontrolled cell proliferation defines cancer. Hence, we have some very important information that we can provide with our test.
One area which we have focused in, where we can provide a lot of value is in the phase where cancer patients are being treated and need to be monitored during that treatment. Typically, those patients today are monitored using image diagnostics, which you can see on this slide. That requires several months from you take the first image to establish a baseline, and several months later, you can follow up with the second image, and you can compare the size, and thereby draw a conclusion if the tumors are growing or not. With DiviTum, we have shown in several clinical trials that we can provide earlier feedback from a simpler solution for the patient or might say a more convenient solution for the patient with a simple blood test. That's as we measure cell proliferation.
In a clinical trial presented or published recently from Washington University, it was obvious that we could see up to three months ahead of the imaging diagnostic if the patient would go into progression or not. Of course, this has great value for the patient getting that quicker feedback, but also for the treating physician and the healthcare providers to make sure that the patients are getting effective cancer treatments. Our ambition and our focus is to start within the breast cancer area, metastatic breast cancer, to launch the product in the U.S. market. Then from there, widen into other geographic markets like Europe and other cancer indications outside of the breast cancer, establishing this as a standard way of monitoring cancer treatments.
With that said, I'd like to move on to slide number five, which is a short summary of our company. The company is based on research performed at Uppsala University and was founded in 2009. We've been at the Nasdaq First North Premier, and we're currently at the Nasdaq First North Premier, and we have been at Nasdaq since 2017 when we IPO'd. We have our headquarters in Uppsala, and we have a subsidiary in the U.S., which Warren will cover in his part of the presentation. We have regulatory certifications since many, many years. DiviTum is CE-marked, and we are also in a 510(k) submission process with the FDA, which I will give you an update on going forward.
With that said, I'd like to move to slide number six, which is a summary of the highlights during this third quarter of the fiscal year for Biovica. Significant events that took place during the quarter, which has actually already been reported in previous reports as after the period, is that we have strengthened our already strong documentation and evidence, both on the clinical side, but also on the health economic side. With health economic, the budget impact model that has been presented on several conferences now also has been published, which of course gives an even higher value of proof of evidence. It was published in the Journal of Medical Economics.
The conclusion in that paper is for every $1 invested in DiviTum , the healthcare providers will get savings three times that, so $3 per $1 invested. Strong health economic benefits. We also had three studies, clinical trials presented at the San Antonio Breast Cancer Symposium, being the major conference within the area of breast cancer to further strengthen the already strong evidence supporting the value of the product. We also started a very important study with Washington University in St. Louis, the TK IMPACT. Washington University, I briefly mentioned on previous slide that they, in a clinical trial concluded that using DiviTum, you will be able to discover progression months ahead of imaging.
They are now continuing pursuing this path to add further strength to the documentation when DiviTum, our product, is compared to imaging. We really look forward to the results of that trial. After the end of the Q3 period, we have also communicated an update on how we are progressing with our FDA process, and that we will be complementing with additional data in May, and I'll get back to you with that on the next slide. We have additional clinical results also being published. PETIA is our first prospective trial with DiviTum, and it's done together with IBCSG, BIG against breast cancer, two major European breast cancer oncology groups, which has a major impact in Europe. That's also a milestone, important one for us.
Recently, we communicated a little bit more about our go-to-market strategy in U.S., which, where a CLIA lab is essential. Warren will give you the details about how we're thinking there. With that said, I'd like us to move to slide number seven, which is an update on the FDA 510K process. The last update we made was in beginning of February, where we have had a meeting with the FDA, and we received positive feedback in many ways. One is that all the questions within the clinical validation area have been resolved and agreed, so we have a common opinion on that going forward. That feels really good, and we're very happy with the outcome of that discussion as well.
The other area in the report is the analytical validation or the performance studies. We also resolved the open questions within that area and with the comment that we should complement with some additional samples to an already performed precision study. We'll complement with that data due to the study design needed to be extended and we feel confident that we can reproduce the already positive results that we've shown in that study in the past. That feels also good. We're glad with that feedback and the work to be able to complement with that data has started, and we aim to be able to do that during May here just in a couple of months. The work has so far also progressed very well.
We've been able to produce the lots that is supposed to be used for this trial, and the next step is to perform the actual trial and send back the data to the FDA. We feel confident that we will be able to meet that deadline in May. With that and the feedback we received earlier, we believe we have a good chance to close the substantive review because by doing so, we will have resolved all the outstanding questions that we are aware of. Then the next step will be the actual decision process, which normally takes 30 to up to about 60 days if the FDA choose to stop the clock. That will be only for a short period of time, so about 60 days during normal conditions.
However, in the last year and a half or so, the conditions haven't been normal, especially not within the IVD area, that has been greatly affected by the pandemic situation as a lot of COVID tests have been given priority. We are seeing now that the FDA communicates that they're going back more and more to normal. We believe also that that will have a positive effect on the review of our application. We expect this to be able to close within a couple of months going forward.
We look very positive on the development on this process within this area. All right. That was the FDA update. The next one on slide number eight is our go-to-market strategy in the U.S., and I'd like to hand over to Warren Cresswell. Warren, maybe you could introduce yourself a little bit before going into presenting the slides. Thank you.
That sounds great, Anders. Thank you very much. Yes, my name is Warren Cresswell. I joined Biovica back in August of 2021, and I come with about 25 years of diagnostic experience. About 2/3 of that time, I worked for a U.S.-based, Danish-owned cancer diagnostic company called Dako. Dako developed and commercialized 510K cleared and PMA-approved products. My career at Dako spanned from working in the lab as a chemist to managing operations, to being a sales rep for about 10 years. I had sales leadership positions and finally general management, where I operated businesses in the U.S., Canada, Latin America, and also Asia-Pacific markets. During about the last third of my career, I was a CEO of an organization called Prometheus Laboratories and Microbiome Diagnostics Partners concurrently until I engineered a successful exit of both businesses.
At Prometheus and Microbiome Diagnostics Partners, we focused on developing and commercializing novel, high-value, multi-analyte algorithm-based tests, provided through our own company, own CLIA lab, and sold into specialty physicians. It should be noted that these products were laboratory-developed tests, also known as LDTs. Like with Biovica, we developed tests aimed at changing the standard of care. With that being said, my experience along with my network have a pretty broad and deep understanding of the U.S. diagnostic business. That's a little bit about me. On slide eight, as we progress towards commercialization in the U.S., our go-to-market strategy has evolved.
The most meaningful strategic change will be to launch DiviTum through a Biovica-owned CLIA lab, which really allows us to manage a number of critical success factors, which I'll talk about on the next slide. It should be noted that we are confident that our evolution and strategy will be successful as it does align with the largest and most impactful high-value diagnostic companies globally. If you could advance to slide nine, that'd be great. What are some of these success factors that I just mentioned? Owning the relationships are one of the most important factors to a successful business. We'll own the relationship with patients, physicians, and payers.
If we were to not evolve into a CLIA strategy, but rather sell DiviTum to any interested labs, we would not know who the patient was, when the patient was tested, how often the patient was tested, what physicians were ordering DiviTum, how often physicians were ordering DiviTum, you know, what clinical benefit or utility the physicians were extracting from DiviTum. Essentially, this would be a blind approach to commercialization. Launching DiviTum through a CLIA lab enables us to know the who, the what, the when, the where, the why with respect to DiviTum utilization and that's very critical to our business. Reimbursement is an element, a key element in getting insurance coverage and driving product utilization. We will work closely with public and private insurance providers to maximize DiviTum's value and of course, maximize coverage.
With the CLIA lab, all patients can have access to DiviTum, which is very important to us. When we launch, we'll have logistics and systems in place to receive, test, and report samples. With respect to data mining, having a CLIA lab allows us to build a significant database of patient test results, therapeutic responses, disease progression, physician treatment decisions, DiviTum utilization, and so on. You can imagine there's no shortage of how data can be interrogated to strengthen our business. Lastly, we will be collecting patient samples with consent, which will allow us to build a sample biobank. We can use these samples to conduct follow-on analysis, prove new product hypotheses, fuel product development, and more.
As you can imagine, building a database and a biobank become valuable assets and are tools which help contribute to the long-term success of the business. If you could advance to slide 10, please. With respect to the CLIA lab status, if we read the timeline from left to right, we've selected a lab location to be San Diego, California, as this is one of the third-largest biotech hubs in the U.S., and it's rich in CLIA lab professionals, which can support our business. Once we made the decision of the location, we identified and leased a commercial property that was already outfitted as a lab and was also move-in ready. We've hired some key individuals to lead operations and commercial functions. Currently, we are working on the CLIA lab application and certification process.
Once we receive FDA 510K clearance, we'll be able to scale the organization extremely fast as we have already identified resources for nearly every position needed. Once this is completed, we'll launch. If we could move to the next slide 11. To illustrate what our evolved go-to-market strategy looks like, we are not just managing the commercial process, but we're really managing the entire business process start to finish. We will have highly trained clinical sales force that has experience working both specialty diagnostics and the CLIA lab business model.
We will engage breast oncologists through a sophisticated call plan targeting process. We will manage the ordering process, the blood collection, and the shipping logistics, and we will receive the samples, test, and report those results. Finally, we will manage a revenue cycle to ensure payment. With that being said, I'd like to hand it over to Cecilia.
Thank you, Warren. We are going over to slide 12 and going over to the financials. You can see in the graph the sales accumulated during the period. It's not that much already because it's still only researcher sales. We had planned to launch the product already, but due to the delay of the FDA process, we haven't. It will stay kind of small until we launch the product at the clinical market in U.S. as the first market. We are preparing that, as you have heard, and we are turning to slide 13.
At the end of the quarter, we had SEK 108 million at the bank, and we are well capitalized with the current capital, and we expect that it will last for more than 12 months of operation. Due to the delayed commercialization in U.S., we haven't take on that many new employees already, so we haven't started to increase that much in expenses, but that will come further on. Also the revenues that will start to come in after launch. The organization is growing, and the average number of employees is now 26 compared to last year's 20. We will continue growing slightly while preparing for the commercialization, and after clearance, that will start increasing again. Thank you, and I'm handing over to you, Anders.
Thank you, Cecilia. To sum it up, we have a very important product that addresses a need for cancer patients being on treatment to get a quicker feedback, which in itself will enable more personalized treatment regimen and within metastatic cancer in general. Our initial focus area is within the metastatic breast cancer area. This has been well documented in collaborations with some of the leading key opinion leaders and academic institution in the business, within, especially within the breast cancer area, but we also have evidence outside of the breast cancer area. This very strong foundation of evidence is also the foundation for the commercialization activities that we are now planning, as Warren briefly covered.
The upcoming milestones, as we talked about earlier, our key milestone now is to by during month of May, just a few months away, to submit the complementary data to the FDA in order to complete the review phase of our product. The next step is 510K clearance. As we have gone through the open issues and only provide complementary data to the last outstanding, we expect this to happen a couple of months later, depending on the workload of the FDA. We also have great hope there since the FDA has signaled that they have increased their resources within the IVD area and also that the pandemic effects are less and less. We're looking forward to that.
That will be the starting point also for our upscale for the U.S. launch, which we have been preparing and are preparing currently, as Warren told you about. We will upscale the sales organization to be a couple of months later, be able to launch the product on the U.S. market, which will be the starting point for our commercialization and sales activities of DiviTum for clinical use. It's only a month away, and we all really looking forward to that in order to create great benefits for patients and healthcare providers. With that, I'm opening up for questions.
Thank you. If you wish to ask a question, please dial zero one on your telephone keypads now to enter the queue. Once your name has been announced, you can ask your question. If you find it's answered before it's your turn to speak, you can dial zero two to cancel. So far, we have one question lined up. That's from the line of Jakob Lembke of ABG Sundal Collier. Please go ahead. Your line is open.
Good afternoon. This is Jakob Lembke at ABG. I have a couple of questions, and my first question is on the development towards getting the 510(k) clearance. Maybe you can just sort of elaborate a bit more on what sort of additional data you have to complement your application with.
Yeah. Perfect. I'll try to give some more background and try to at the same time avoid being too detailed as the topic is a bit complex and the application is extensive. Basically, we've been in discussion since May when we received the first feedback, and we resolved many outstanding questions. In that process, both within the precision area and within the clinical area and to a great extent, it is about understanding each other. A lot of the questions could be resolved only by explaining and discussing, and the FDA has accepted our explanation. In that process, when we make one change in one area, that actually affected a precision study which we had already performed with success. The study design had to be modified slightly.
We had to add some samples that had to be analyzed, and that's basically what we're redoing. Redoing a precision study that we already have performed with a successful outcome, but we're adding some samples because the FDA requested a slightly different study design due to some of the other topics that were discussed and had dependencies to the study. Could you follow what I said there? It was a bit complex, but did you understand?
Yeah, I follow. My second question.
Yeah. [crosstalk] Just that since we've done this in the past successfully and we're redoing it, we feel confident that we can do this again.
Understood. My second question also on the FDA is sort of your impression of how the FDA is transitioning to a sort of post-pandemic state. If sort of the degree of uncertainty regarding the timeline and review times and so on are improving.
They haven't been super specific about that, but they have given some information away. They did a report recently where they summarized the year 2021 that they sent to the Congress, and they identified the IVD area as the toughest one. That they'd done that before as well due to the number of COVID tests. They, at the same time, communicated that it's improving due to two factors, that they've had an increase in the number of resources within this area, and at the same time, that the pandemic effect is getting less and less.
So that is what we know, and if the normal timeline is one to two months, we believe that it will take maybe some extra time, but it's not more than a couple of months. It's our hopefully qualified guess based on the feedback that the FDA has provided officially.
Okay. If we move on to your new sort of U.S. go-to-market strategy, obviously, I mean, it's a good opportunity to be able to have direct interaction with the clinicians. I'm wondering a bit on your view of sort of your ability to reach the broader market and how this new strategy will impact the sort of sales ramp-up if maybe the sort of penetration development will be a bit slower with this strategy.
I'll introduce this, and I'll hand it over to Warren if you want to complement. First of all, I would say that it's not a new strategy. It's an evolved strategy. We have detailed it further. We will have a 510K cleared test in a couple of months, is our ambition. We still have the opportunity to do partnerships and if we find that a good way forward. We will negotiate from a more powerful position because we will have been able to validate the asset commercially and also achieve reimbursement.
When it comes specifically to the sales team, we had already planned and communicated previously that we will build up a sales team that will initially address a focus on the NCI designated cancer centers. I know also that this model scales well and are being used by other companies within this field, but maybe that's where I should leave it to you, Warren, and maybe you could talk a little bit about how well it scales and how you see the sales force develop.
Yeah, absolutely. Thanks, Anders, thanks for the question as well. I agree certainly, Anders, everything you said we're completely aligned with. I think you know the one thing to note as well is that from a strategy perspective it was always Biovica that was going to be the ones driving demand so that does not change whatsoever. Initially we will start out with a smaller sales force of these very technical folks. As we receive feedback and utilization of the product we will scale appropriately.
You know, the real benefit to calling on specialty physicians. It's unlike the primary care market where there's, you know, 10 times as many. You know, you can make a pretty significant impact with the small sales force and then scale appropriately moving forward. From that perspective, you know, this evolved strategy of having a CLIA lab really does not impact what we'd always planned on doing in regards to meeting with the physicians directly and driving utilization.
Okay. Just a follow-up on that, I mean, with the let's call it evolved strategy then, and also the establishment of the CLIA lab, how will this impact sort of the near and midterm costs, think of let's say rents and maybe also increase in headcount?
Well, the most immediate change is the headcounts that it takes to run the lab. That's an addition. In order to do so, it's only a few couple of individuals required to do so initially. Of course, when the volumes increase, we need to increase the headcount in the lab as well. We also have the opportunity to automate part of the process so that part will scale very well, especially if you consider that the margins will be greatly improved because then we will offer the lab services as well ourselves.
Understood. My final question, just, Warren, you mentioned that you had previous experience from working with lab developed tests. I guess that is dependent on having a CLIA lab. Just going forward, once you have that, is a lab developed test a potential route you are gonna explore as well?
We will offer that didn't come as a 510K cleared test from our own lab. Going forward, we have options to choose. Is that fair to say so, Warren?
Yes, absolutely. I completely agree.
Okay. Thanks for taking all of my questions and have a great day.
Thank you.
Thank you. Once again, if there are any further questions, please dial zero one on your telephone keypads now. Okay. There seem to be no further questions from the phone lines at this time, so I'll hand the floor back to our speakers.
Thank you very much for everyone dialing in and joining this conference. Bye-bye.