Welcome to Egetis Therapeutics Q3 Report 2024. For the first part of the conference call, the participants will be in listen only mode. During the questions and answers session, participants are able to ask questions by dialing star five on their telephone keypad. If you are listening to the presentation via webcast, you can ask written questions using the form below. Now I will hand the conference over to CEO Nicklas Westerholm. Please go ahead.
Thank you, operator. Good morning and a warm welcome to Egetis Therapeutics webcast for the Quarter three report and results. For those I haven't had the privilege to meet before, my name is Nicklas Westerholm and I am the CEO of the company. With me today I also have our CFO Yilmaz Mahshid, Karl Hård, our head of Investor Relations and Business Development and Henrik Krook, our head of Commercial Operations globally. What we were planning to cover today are updates on several important milestones delivered during the quarter. We will touch upon the progress for our Marketing authorization application for Emcitate with the EMA, the Guidelines for Diagnosis and Management of Emcitate Deficiency issued in July by the European Thyroid Association. The new data published through an abstract concerning survival. The data was presented at the 46th Annual Meeting of the European Thyroid Association in September.
The ReTriACt status is obviously important, recognizing it's a pivotal randomized control study for the U.S. submission. We'll also touch upon the patent application we submitted to the U.S. Patent and Trademark Office regarding the preparation process for Tiratricol and also touch upon the news that will feature during October and early November, which was the directed share issue of around $30 million. We'll then move into a financial update from Yilmaz and then subsequently move into Q&A from the audience. Starting off with the Marketing Authorization Application for the approval in the European Union, we are very pleased to call out that we remain on track according to EMA's stipulated timelines. As many of you would know, the Marketing Authorization Application was submitted in October last year and subsequently we received in February the 120-Day Questions, which we responded to in August.
Subsequent to that, as per the stipulated timelines, we received on the 17th of October the 180-Day Questions and plan to respond to these by November 12th, that is, beginning of next week, according to EMA's published procedural timelines. Subsequent to that, the ball is of course in the EMA's court. But we're looking forward to CHMP opinion towards the back end or early next year along the lines of Europe. We also had some guidelines that was issued in July. The guidelines was issued by the European Thyroid Association ETA covering diagnosis and treatment of Emcitate deficiency among others. This is somewhat unusual recognizing that Emcitate deficiency is an ultra-rare condition with no therapy approved today.
These guidelines recommend the use of tiratricol or Emcitate as a long-term therapy for all patients with Emcitate deficiency but also for certain patients with a different indication such as resistance to thyroid hormone beta RTH beta. This is of course valuable for us moving forward. It will be important for the commercialization in Europe when there are now clear guidelines existing and we'll support also driving disease. Page two. Some news that was published in Rotterdam so this data derives from a retrospective research study by the Erasmus Medical Center in Rotterdam where they investigate tiratricol on mortality in patients with Emcitate deficiency. The abstract was published ahead of the ETA and the data presented is really valuable for us.
It illustrates that tiratricol treatment had an approximately three times lower risk of all-cause mortality, which is of course again very much to our benefits moving ahead, especially when it comes to payer interactions in Europe as well as the forthcoming U.S. drug application. On top of that, a peer-reviewed publication is in progress, which will hopefully be published at the beginning of next year. Turning our attention to the ReTriACt study, where we have had better progress in quarter three compared to previous quarters, which is very important to underline. As a reminder, this is a study that was agreed with the U.S. FDA: a pivotal randomized placebo-controlled study in at least 16 evaluable patients with Emcitate deficiency to support the NDA.
We all recognize and we need to be humbled that the recruitment in previous quarters hasn't been up to our expectations and to increase the recruitment study during the summer we added three additional clinical study sites, commercial study sites which was opened in July in the U.S., one in Texas, one in Georgia, and one in North Carolina. So at this moment we have six study sites open, two in Europe and four in the U.S. The current study status includes the two patients we expected to be randomized and which we called out in our quarter two report. Furthermore, these six patients planned for screening which we also mentioned in the quarter two report resulted in four new patients that are now in the run-in period.
So in total we now have 17 patients included where eight patients are available and four patients are in the so-called run-in period . Please note here that as for any clinical study there will be a few dropouts and hence not all patients included will be randomized. Going forward we have more than 10 eligible patients identified and remaining for recruitment going forward, of which a couple of patients are already scheduled for screening in the coming weeks.
As previously communicated, we have full focus on the recruitment in the ReTriACt study and we will update the market as soon as recruitment of the study is closed and at that point in time we'll also be able to provide information on expected top line results and when we plan to submit the new drug application. Moving on to our patent application, as many of you know, today Egetis holds orphan drug designation ODD for Emcitate for treatment of Emcitate deficiency as well as RTH beta both in U.S. and Europe that provides marketing exclusivities of seven years and 10 years respectively. From the dates of regulatory approval, we were very pleased with the submission of our first patent application concerning processes of preparation for tiratricol and in layman's word, manufacturing patents.
If granted, this will be a significant patent and important for us, and generally the exclusivity term of a new patent is 20 years from the date to which the patent application for the specific patent in question was filed in the U.S. . Let's turn our attention to our directed share issue. We announced the share issue, the directed share issue on 30th September. This was a directed share issue for approximately $30 million or SEK 300 million. The directed share issue was oversubscribed and included both existing and new international and Swedish institutional investors. We are very proud considering the challenging market conditions that we executed this on. The subscription price at market and more importantly the directed share issue was led by Frazier Life Sciences with $10 million or roughly a third of the share issue executed on their behalf.
So with that, let's turn our attention to the financials for the quarter and I hand over to our CFO Yilmaz Mahshid. Please go ahead.
Thank you, Nicklas. Looking at the numbers, revenues for the first nine months of the year were SEK 35.3 million versus SEK 25 million in the same period last year. Revenues for the third quarter of the year were SEK 9.4 million versus SEK 12.2 million in the same period last year. The lower numbers in the quarter versus comparison period in 2023 are due to lumpy order patterns from countries where the drug can be reimbursed at the pre-approval stage. Results after tax for the third quarter of the year were SEK -86.2 million, which also was the same number in the same period last year. Operating cash flow for the third quarter of the year were SEK -62.5 million vs SEK 93.1 million.
Second, the same period last year, and the cash position at the end of September was approximately SEK 130 million versus SEK 85 million at end in the same period last year. As Nicklas mentioned, it was very gratifying to see that we have good support from existing and new shareholders, which did result in a net cash injection to the company of SEK 282 million that occurred post the period close. While mentioning cash, I would also like to highlight that Emcitate has been granted Rare Pediatric Disease Designation , which gives Egetis the opportunity to receive a Priority Review Voucher in the U.S. at approval, and as a guide to your modeling regarding the cash position for the company, the base case should be that we will transact and sell the PRV.
The public figures, as many of you probably are aware, for the last two transactions of PRVs are in the range of $150-$158 million, which would mean approximately SEK 1.6 billion-SEK 1.7 billion on current dollar value and of which we are eligible to 50%. With that I would like to hand back to Nicklas.
Thank you very much, Yilmaz, for the financial overview and that takes us to the end of our presentation and I'll hand over to the operator for questions and answers. Operator, please.
If you wish to ask a question, please dial star five on your telephone keypad to enter the queue. If you wish to withdraw your question, please dial star six on your telephone keypad. The next question comes from Chien-Hsun Lee from Pareto. Please go ahead.
Hi, good morning, and thanks for the presentation. So yeah, a few questions from me. So regarding the U.S. trial, you have included 17 patients and eight have completed and four enrolling phase. Does it mean that the five patients they have dropped out or they are still subject to the screening? And for the ones who dropped out, is there any reason that you can possibly share?
Good morning Chien-Hsun , thank you for your question and I think I'll reiterate what I said before just to set the scene. Yes, we have made good progress and during quarter three when it comes to recruitment, as we called out in the second quarter report, the two patients we were planning to be fully randomized has been fully randomized. We were planning six patients for screening. Those six patients were screened and led to four patients in the run-in period . You're absolutely right when it comes to dropouts that as in any study, one will have dropouts, it's fair to assume that the dropout rate would be around 20%. When it comes to screen patients as well as patients being a study, the dropouts though I need to be very, very clear here that the dropouts are not related to study drug.
As you can imagine, I can't give specifics around specific patients, but could be related to things like an illness in the family where the parents or caregivers subsequent to that didn't have the bandwidth for their children to continue in the study. So I think it's very important to recognize yes, we have had dropouts and we'll continue to have dropouts most likely, but it's not driven by study drug.
Okay, thank you. Yeah, that's big here for me and also a question regarding the European process. So regarding the 180-day list of questions that you plan to submit next week, could you share a bit like is there anything that's unexpected that you received from the EMA or you believe it would be just some minor issue and if the European approval would be on track and let's say if it's later this year or early next year. So what's the go-to-market strategy in Europe? Thank you.
Thank you, Chien-Hsun . And yet another good question and you rightly so that on the 17th of October we received the day 180 list of outstanding questions or issues. We plan to respond to these according to the stipulated timelines, i.e. 12th of November one can draw a conclusion that since we are not asking for an extension, these questions are manageable for sure. I really want to thank the whole team in Egetis for their outstanding work in responding to the 120 day questions in Europe because that removed a lot of the concerns, potential concerns or questions the EMA had. So I see personally that based on the list of the 180 day questions we received in October, we have a path forward without any surprises to a CHMP opinion. And then I missed your second part of the question, Chien-Hsun , if you don't mind repeating that.
So yeah, what would be the go to market strategy in Europe once it's approved?
Yeah, so the go-to-market strategy is very simple and it doesn't differ compared to other companies. When commercializing in Europe one should recognize that post the CHMP opinion, it's up to 67 days until you get the European Commission approval. So one can't commercialize until after that. Then as many other companies we will initially focus on EU4, Germany, France, Italy, and Spain and going in parallel with reimbursement dialogues, obviously where the country where we can recognize sales earliest is again as for any other company, is in Germany. And there, as I'm sure you are familiar with there, it's free pricing through commercialization during the discussion of reimbursement for up to 12 months. So that's our go-to-market strategy. And then subsequent to that, of course, Italy, France, Spain. I can't give you guidance on exactly how long the reimbursement period will take there.
It will take time, but it's roughly one to two years and in parallel then we of course will go broader after the reimbursement dossiers have been submitted in EU for rest of Europe.
Okay, perfect. Thanks for taking my question.
Thank you, Chien-Hsun . We can move on to the next question.
The next question comes from Oscar Haffner Lamm from Bryan, Garnier & Co, please go ahead.
Hi, Tim. Congrats on the execution. My question would be regarding the survival data that you have published. I was just wondering if this is something that could eventually end up in the label and ultimately if in your view, this could impact the pricing negotiations with the authorities both in Europe and in the U.S.? Thank you.
Yeah, no, that's a really, really good question. And obviously I can't share too much around the data because the peer review publication is not out there yet. And as I expected and mentioned before, that will be out during the beginning of next year or first half of next year. I think this is of course an important piece of the puzzle when it comes to pricing and reimbursement. So this will definitely be part of the dialogues we have in Germany, France, Spain and Italy subsequent to European approval. So again, a very important piece of the puzzle. It's of course also an important piece of the puzzle in the forthcoming interactions with the FDA on the new NDA application. So, yes to both of your questions, Oscar.
Great, thank you. And maybe just one additional small question. I was wondering maybe if you could provide any insights on the status of the patients that you have last included in the trial in terms of whether most of them were treatment naive or on treatment with Emcitate prior to the inclusion.
Now that's a good question and it's a simple response to that. And as we're moving forward with the recruitment and the progress, which I'm pleased with, not happy, but pleased with, that we're improving the recruitment pace during quarter three, it's reasonable to assume that going forward the majority of the patients being included in the ReTriACt study will be treatment naive patients.
Okay, perfect. Thank you for taking my questions.
Thank you. Let's move on to the next question.
The next question comes from Mattias Häggblom from Handelsbanken. Please go ahead.
Yeah, thanks so much. Mattias Häggblom, Handelsbanken. I had a question around. Curious to hear your thoughts around two of the most recent transactions around Priority Review Vouchers. I've seen a step in value from previously historically around $100 million to now $150 million. So obviously with you potentially having access to one of those over time, any thoughts from your side? What's been driving this 50% value step up? And then secondly on the Expanded Access Program and the U.S. could you remind me about recent progress with regards to that to help me frame expectations what to expect from that going forward. Thanks so much.
Thank you and very good questions, Mattias. For the audience and Yilmaz must mention this as well that due to the Rare Pediatric Disease Designation that we received a couple of years ago, we will be eligible for a Priority Review Voucher at the point of approval. And this is of course very important for us. As mentioned, when it comes to future cash position and financing of the upcoming launches both in Europe and in the U.S. this is very much driven. The value of the vouchers PRV value has been very stable actually during 2021, 2022 and 2023 in the region of $100-110 million. What we have recently seen actually are the two last PRVs that has been sold has been amounting to $150 million and $158 million.
And what has driven this hike, so to say, in the value of these? Are usually driven by demand and supply.
I can't speculate more than that, but that's how we see it, which of course play somewhat in our favor for a potential divestment of a voucher in the U.S. . Then when it comes to your second question around the expanded access program which I think has bearing on number of patients being identified in the U.S. . There it's very pleased to say that the disease awareness activities we have been despite with the small number of people on the ground or small number of feet on the ground, we only have four employees in the U.S. as many of you are aware, we have made some really good strides and the team has over the last 12-18 months identified now up to 100 patients diagnosed with Emcitate deficiency in the U.S. when it comes to which is of course very important for a potential of co approval and commercialization to identify as many patients as possible when it comes to specifically around the early access program or the EAP program in the U.S. we have 10 sites open so far and we have another eight sites in process.
The important thing here to recognize is that since the ReTriACt study is in focus to drive the recruitment, we are very restrictive on adding new patients into the expanded access program if they are not eligible for the ReTriACt study. So we need to focus on the ReTriACt study. The newly identified patients should be funneled into that for screening. If they're not eligible for any specific reason, will then of course transfer them over to the expanded access or early access program driven by inclusion criteria such as age below 4 years as an example. I hope that answered your question, Mattias. Questions.
Perfect. Very helpful. Thanks so much.
Thank you.
The next question comes from Fredrik Thor from Redeye. Please go ahead.
Hello and thank you. My first question was about this patent application, about the processes of preparation. Can maybe just give us some context to that patent, how useful it actually can be and maybe compared how strong it is compared to the Orphan Drug Designation. Thank you.
Yeah, no, thank you Fredrik. It's a really good question and as and just to reiterate what I said before, this is a patent that resonates within the CMC and manufacturing space. Obviously one need to recognize that this is not a composition of matter patent. And that's driven of course by this molecule is an old molecule that was discovered in the 50s. Having said that, so it doesn't have equal strength. I would say we need to be humble with that compared to a composition of matter patent. What's important to recognize here that we have done substantial improvements in the process such as crystallization, impurities, etc. And that is really valuable going forward that if one could get protection on that, that will of course help us from an exclusivity perspective.
On top of that, it's also worthwhile recognizing that the drug substance manufacturing has a couple of chemical steps that includes high energy reactions and that hence needs to be manufactured in a bunker. So all in all together this is an important patent. It's not we need to be humble. It's not as strong as a composition of matter patent, but it will help us definitely from generic penetration going forward if approved, of course. Thank you Fredrik.
A final question, if possible ahead of the potential EU launch, have you received any feedback from payers or key opinion leaders about the results from the Triac Trial study about the neurocognitive results, how much that impacts their view of the drug candidate, the willingness to pay and so on? Or is it too early to say anything?
No, I think that's a very good question and comes back to the ReTriACt results that we announced during the summer and here I think it's very, very important to say that when it comes to the regulatory pathway, the results of the Triac Trial II study doesn't implicate that neither in Europe nor in the U.S. both agencies has been very, very clear that the regulatory pathway is driven by treatment on peripheral thyrotoxicosis and the clinical effects we've seen in that space. So that is very, very clear. The Triac Trial II study was important though, from a regulatory standpoint when it comes to safety. So establishing the safety profile in the younger patient population and obviously studied patients below 30 months of age, 22 of them. And that generated some very, very important safety data that was incorporated in the response to the 120-Day Questions submitted in August.
When it comes to pricing, we still expect that we will receive orphan premium price both in Europe and in the U.S. When it comes to Europe, we expect some implications on price due to not being able to show neurocognitive development effects. But on the contrary, in the U.S. our price assumptions still remains the same since pricing and reimbursement drivers are different.
Thank you very much.
Thank you, Fredrik. And I think we have time for a final question from Joe from RX.
The next question comes from Joe Hedden from RX Securities. Please go ahead.
Good morning. Thanks for taking my questions and congrats on the progress in European procedure. Just a point of clarity on that, Nick, you said that you've got a path, you know, if you respond to the 180-Day list of outstanding issues on time, you've got a pathway to a CHMP opinion. Can you say whether that is likely to happen in the December CHMP meeting? And then just a second question on the compassionate use sales of the drug. I just noticed that I think for the first time the compassionate use sales have ticked down and I just wondered whether that's a factor of the amount of patients treated or the price that you're getting on those. Now, I know it's a minor thing, but just any color you can give would be great. Thanks.
Yeah, sure. And when it comes to the potential CHMP opinion, as I said, we received the 180-day questions on the 17th of October. We plan to respond to that next week on the 12th of November by the latest. Obviously subsequent to that the ball is in EMA's hands and the CHMP. They could come back with another batch of 180-day questions or they can well move on to the 210-day, which is a CHMP opinion. So I don't want to speculate on that, though, because that is somewhat dangerous since it's out of our control when it comes to our Managed Access Program here.
I think we should be very, very clear that in the quarter two report we refer to around 220 patients being included in the Managed Access Program . In quarter three we have said above 220 patients. So numerically we have seen an increase quarter on quarter. What we tend to do, Joe, is really reporting in teens, right? So I wouldn't read too much into this. If you look at the run rate over the last two years, you have at minimum over 10 patients per quarter being added. Then it is some fluctuations and as I said before, so when it comes to newly identified patients in the U.S. we are prioritizing the ReTriACt study rather than put them on the expanded access program.
Okay, that's great, thanks. It's good to see it picking up. But what happened to the Q3 revenue? I know it's not a lot, but it's the first time it went down. But should those two not be tracking in line?
Joe, thank you for the question. Yilmaz speaking here. Yeah, so we saw a little downtick on the revenues from the Managed Access Program and I had the same question to the commercial team. They don't see any trends in the ordering, etc. This is just the lumpiness when it comes to reimbursement, when we get the orders from reimbursed countries or not and from those patients. So we have not heard anything from the organization on trend changes.
Okay. All right, fair enough. Thanks, Yilmaz. Thanks, Nick.
Thanks, Joe. And that takes us to the end of the call at this time.
So I hand the conference back to the speakers for any written questions and closing comments.
With that, I will take the opportunity to thank the audience for participating in our webcast concerning our quarter three results report and thank the team for participating on the side and wish you all a happy Friday. Thank you.