Welcome to today's presentation where we have the pleasure to present ExpreS2ion Biotechnologies . To help us through today's presentation and talk a little bit about results and answer questions in the end, we are joined by CEO Bent Frandsen and CFO Keith Alexander. Today's topic, of course, your Q2 report out fresh from the press, but I guess also the bigger broader picture, what has been a lot, I think, a very busy news flow over the summer by you and in the early spring. As always, ask questions down in the box down below. We already got a lot in. See if it's already answered. I would also say we have a firm deadline at 11:00 A.M., unfortunately. You are very welcome to send in the questions. If you don't get to the IR web made by you, and I know Bent, I have seen your program.
You also have a lot of presentations at other places, so maybe the questions can be asked there. For now, I'll hand the call over to you, Bent.
Thank you very much, Michael. My name is Bent Frandsen. I'm the CEO of ExpreS2ion Biotechnologies. Keith Alexander and I'll be going through ExpreS2ion, where we are today on the back of the Q2 report that we just released today. We had some exciting information here coming up. We'll be going through our strategy and pipeline, subsequently the financial results, and allowing some time for Q&A, as Michael also alluded to. First, going through strategy and pipeline, I think the important keyword here is momentum. We have been following up on the announcement we've been making earlier, making progress, especially on our breast cancer vaccine assets in clinical stage one. This we're going to talk through. Just in the beginning here, let's just all be clear on ExpreS2ion's strategy. It's laser-focused. We have, first and foremost, the advancement of our proprietary pipeline.
That's, of course, delivered by the progress on ES2B-C111, the project code for our breast cancer immunotherapy. Second is to amplify our impact through collaborations across malaria, influenza, and Nipah, where we, in essence, actually borrow scale and expertise from collaboration partners in non-dilutive funding setups. Thirdly, we are keeping on the innovation, and we are proving new concepts, and we have been filing novel patent applications. Finally, we aim to monetize on the platform that we have also with respect to our contract services, where we leverage on our platform for clients. At least four pillars are together, ensuring that we not only innovate, but also create value and stay financially profit. Our strategic focus, we've been able to deliver in the second quarter. We have moved from plans to execution, you can say. In Q1, we announced plans.
For example, the letter of intent with WuXi Vaccines and not least the trial protocol amendment for the breast cancer vaccine asset. In the second quarter, we have executed on these. Our HER2 vaccine, the ES2B-C111 vaccine trial, dosed its first patient and got regulatory clearance to expand, and our partnerships have paid off on top of this. In fact, our joint venture secured a major funding for a viral virus vaccine and also joined a new malaria vaccine consortium. In that sense, we've been achieving some major goals here even in the second quarter. Let's dive into ES2B-C111. It's being developed for HER2 expressing breast cancer patients who have exhausted standard treatments. It's a ray of hope for those patients. The phase I is a dose escalation trial where we start with 50 micrograms and progress up to 450 micrograms, all doses with adjuvant.
A data safety monitoring board decides whether the study can progress to a higher dose. Patients will receive one intramuscular injection every third week and in total five injections. The primary endpoints are safety. Secondary endpoints are immune responses and signs of clinical efficacy. The dose escalation will be carried out in a three plus three design with advanced metastatic breast cancer patients where cancers express HER2. The time in this is approximately 48 weeks from the first patient's first dose. Subsequently, additional patients will be dosed to confirm the recommended phase II dose in the following six months. Thereafter, we will have evaluated up to 27 patients in the 18 months which we expect the trial to take. We are essentially testing if we can safely turn a patient's immune system into a precision weapon against HER2. It's an exciting new approach for HER2 cancer.
Momentum in this, we are recruiting. The quarter marked the turning point for ES2B-C111 clinical trial for that. In late June, we received the regulatory green light earlier than expected, allowing us to combine our HER2 targeted vaccine with state-of-the-art antibody drug conjugate therapies. Why is this important? Because it means patients receiving cutting-edge drugs like. Enhertu can join our trial. In other words, we've opened the door to patients who previously might not have been eligible, aligning our study with what's actually happening in oncology clinics right now. We're growing our presence in this trial. We didn't stop at the regulatory approval. We proactively expanded our trial's footprint on the ground. In Vienna, we made agreements with five major oncology clinics to establish a reference network.
To ensure that we can serve the growing interest, we also brought two additional trial sites on board as part of the amendment, one in Linz and another in Graz. This means a patient doesn't have to travel far or wait long to participate. The trial is more visible and accessible than ever, and most importantly, now on track. If you look at the development path going onward, this is an assessment of our high-level development plan. Needless to say, ExpreS2ion would like to proceed beyond the clinical phase I trial and to also document clinical proof of concept in a phase II trial. The design of this is very dependent on the outcome of the phase I trial. Positive results in a randomized phase II trial would be a very significant value trigger. This would also be the time we would expect to out-license the program.
A proof of concept phase II trial would start in the beginning of 2027 and run for approximately 24 months. What would it take to bring this vaccine to patients faster? As previously mentioned, it may be possible to receive conditional approval to start marketing the vaccine, even if the phase II has shown clear progression-free survival over standard of care. HER2 is also the target for gastric cancer, so we will also be evaluating a parallel phase II track to broaden the impact if phase I shows safety. HER2 is just as common in gastric cancer as in breast cancer, even though most people only associate HER2 with breast cancer. We'll explore partnering opportunities prior to phase III, so this timeline may be executed by us or a partner. In the malaria projects, I should say, this is important. Malaria remains a global health challenge.
Through the University of Oxford, our ExpreS2ion platform is central to several vaccine candidates targeting malaria's life cycle. This table shows how active this area is. Multiple trials on multiple continents are going on. The key is any success here validates our ExpreS2ion technology and could lead to a licensing deal. For example, in the discussions we have at the moment with the Serum Institute of India. BACK 099, which is for PFS 45, has been added as a new clinical trial in the portfolio and now actively recruiting in Burkina Faso. Several other trials have been updated with pipeline timelines since the last quarterly report. Importantly, three additional trials, BLACK 089, BIO 03, and BLACK 093, now have estimated completion dates specified for the first time. That's in Q1, Q2, and Q3 2026, respectively.
With respect to RS5, a key component in the blood stage malaria vaccine, this is a very important target. A fun fact is here that the RS5 vaccine that we contributed with so far is among the first to show strain transcending efficacy in a phase I B trial. If it's successful, it could complement or even improve upon the new WHO recommended malaria vaccines. Across other programs, across Nipah virus vaccine, across influenza vaccine projects, our platform's versatility is on display, all from enabling next-generation nasal influenza vaccine to contributing to a first-ever virus vaccine. These are long-term shots on goal, mostly funded by others, but each success would reinforce that our ExpreS2ion platform can tackle diverse pathogens. Summing up, this is our pipeline as we depicted today. We are a platform-based vaccine company.
At the top, you can see our 100% owned breast cancer vaccine in phase I and on track and progressing as we speak. This is the most important program right now. The rest of our pipeline leverages partnerships and grants. For instance, our malaria vaccines that you can see here are funded by non-dilutive funding and carried out by University of Oxford. No cost to ExpreS2ion on that account. The same goes for Nipah and influenza. The takeaway is that ExpreS2ion is really not a one-product company. It's a platform with multiple shots on goals and de-risked by partner funding in many cases. If you look at the bottom, the COVID-19 project, which was discontinued by the licensee Bavarian Nordic in clinical phase III after having met its primary endpoint due to the commercial plans for Bavarian Nordic.
In the assessment of this, we remain very proud that it basically documents a clinical phase III validation of our platform. We have a lot of upcoming catalysts. We have on the breast cancer vaccine asset ES2B-C111, of course, we'll be announcing when safety and tolerability can be announced as well as with efficacy data. On the Oxford malaria trials, as you saw from the table, many clinical milestones coming up, all based on our platform. The selection of the Nipah virus vaccine lead candidate is also an important part of the upcoming data. On strategy and platform, we still have the Serum Institute of India licensing agreement discussions ongoing. We are also extending our filing and grants on IP. Furthermore, on [grand fund] pro platform validation, we are progressing through the influenza project, Mukovacs and Indigo, as well as the Nipah virus vaccine in the BGPCs consortium.
That said, I'll carry over to Keith to go through the financial results.
Thanks, Bent. As CFO of ExpreS2ion, I'll shift the focus now from strategy and development to our financial performance, walking you through the Q2 and half-year 2025 results. Our total income in the first half of 2025 was SEK 6.4 million, up 61% from the first half of 2024. This kind of growth for a company at our stage with limited proactive marketing shows how active our collaborations and grants have been in fueling our R&D. In the second quarter alone, income was SEK 3.4 million, a 42% year-on-year increase. In the middle chart, you can see net sales, which is revenue from projects, licenses, and our web shop, continuing the rise that began in Q4 2024, up 49% from Q2 2024, thanks to growing CRO project revenue.
On the right, other operating income, which is grant funding, also kept growing, driven primarily by progress in our Mukovacs and VG projects. Moving to the cost side, we completed certain high-cost activities, including preclinical studies and CMC manufacturing for ES2B-C111. External R&D spend is much lower now than a year ago. This will, of course, tick up as we add patients in our phase I trial, but only modestly since the dose escalation phase limits us to around five patients at a time. This means that these costs are spread out over time. In fact, external R&D costs were 80% lower in Q2 2025 than in the year-ago quarter. These R&D costs can be large and variable, driven primarily by pipeline activity. Operating costs in Q2 total around SEK 15 million, down 35% year -on -year.
On the right-hand side of the slide, we break out the two largest components. The top chart shows external R&D costs, which I discussed a minute ago, and the bottom chart shows personnel costs. For the personnel figure, we exclude share-based compensation to highlight the underlying cash personnel cost. This underlying personnel expense peaked in Q1 2023 and was about 5% lower than a year ago in Q2. Foreign exchange had an impact here. The Swedish crown strengthened 5% against the Danish crown, making our DKK-denominated wages more expensive in SEK terms. We do keep an INFX impact, but that is largely out of our control. Our net result for the first half of 2025 was a loss of SEK 21.5 million. This is in line with our expectations and reflects continued R&D investment in ES2B-C111.
It is higher than the prior year period's loss of SEK 10.3 million, but that comparison is distorted by a one-year AdaptVac dividend last year. In Q2 2024, we recorded a SEK 22.5 million one-time gain from AdaptVac related to a Bavarian Nordic milestone payment, which gave us a temporary net profit that quarter. Excluding that one-off, last year's underlying Q2 net loss was around SEK 20 million, meaning our Q2 2025 net loss of SEK 10 million is actually a significant improvement on a like-for-like basis. This slide shows how our cash balance has developed in 2025. We started the year with SEK 82 million. Since then, we've used about SEK 31 million for operations, with roughly two-thirds of that spent in Q1, mainly due to annual payments for long-term stability studies for ES2B-C111 and some one-time phase I setup costs at our CRO.
In Q2, our burn rate was lower. CMC costs dropped significantly, and clinical trial expenses became the primary R&D cost. We had minimal cash flows from financing or investing activities this half, and foreign exchange movements cost us around SEK 1.5 million year to date. All told, the company ended Q2 with SEK 49 million in cash, a decrease of SEK 33 million since December. Based on our budget, SEK 49 million covers our operations through the end of Q1 2026, excluding any financing or partnership inflows. This chart illustrates how we repeatedly strengthen our balance sheet through non-dilutive funding, including grants and a dividend from AdaptVac and equity raises with corresponding warrant exercises. As of Q2 2025, we closed the quarter with SEK 49 million in cash, giving us runway through the end of Q1 2026 based on our current budget.
Like many biotech companies at this stage, we expect to strengthen our balance sheet ahead of major milestones. Importantly, we've done this successfully in the past through a combination of non-dilutive funding and equity raises, and we intend to continue pursuing the most value-creating options. Turning now to the TO11 warrants. These warrants were issued alongside the TO10 warrants in last year's rights issue. Every 40 TO11 warrants gives a holder the right to subscribe for one new share. The subscription price will be set at 70% of the volume-weighted average price during the pricing period from September 1st to September 12, with a floor of SEK 4.44 and a cap of SEK 70. The subscription period runs from September 18 through October 2, and shares will be delivered shortly afterwards. Importantly, the TO11 warrants are listed and freely tradable, so they're open to all investors, not just existing shareholders.
Structurally, these warrants have a built-in 30% discount in the pricing mechanism, which could offer a particularly attractive entry point for investors depending on where the share price trades during that period. Further details, including the application form and full terms, will be made available via press releases and on our investor website. To support the TO11 warrant process and ensure every investor has a chance to engage, we've lined up a broad set of upcoming investor presentations. We'll be present in both Denmark and Sweden, where most of our investors are, and we're also trying some new forms such as pro hearings. These events, in person or virtual, are great opportunities to hear more about our progress, ask questions, and get clarity on the warrants on our broader strategy. We encourage you to join us at whichever session fits your schedule best.
With that, I'll pass it back to Michael to start the Q&A. Thank you.
Thank you. There are some questions. I think you covered the TO11 warrant program. There are some questions. Will you catch to get some news flow out? I guess you don't want to comment on that point. It's a very short time frame, but there's a question around whether you will catch, whether there will be any news flow before the period here.
I think we've just laid out the momentum that we have in the second quarter, and we are continuing progression on the breast cancer vaccine trial, as well as moving on the discussions with the Serum Institute of India on the licensing agreement. There is a lot of progression on the malaria trials. All this said, of course, we'll make the announcement to our shareholders as soon as there's any important value trigger here to announce.
There are always questions about whether you will keep or why the management, if they believe in the company, don't buy more shares. Keith?
Maybe mostly directed to me, I'll just say that I've been participating in every rights issue that I've been in this company, and I've been participating on the warrant programs that have been associated with the rights issue to the fullest extent. I still intend to have that planned.
Perfect. If I could just chime in, I would just say one thing. I frankly think it's a little bit of a rich question, because if you look historically, we all have participated in all of our equity fundraisings, and we have been solid supporters of the company since we've been here.
Perfect. When are the results from the breast cancer treatment expected to be published?
Publication, as we've alluded to, that is in 2026. We expect interim data in the middle of 2026 and full data by the end of 2026. As mentioned, the trial design is following nine patient dose escalation phase, followed by 18 patient in a dose expansion phase. We'll be monitoring on safety and monitoring on immunogenicity. If we believe there's relevant data to announce, we'll do that.
When is the next data on the malaria expected? I think that was pretty well covered on the slides you showed there, actually, with all the results completed. Can you do more to highlight the value you have in AdaptVac? You had a decent news flow out there, some big grants also progressing on maybe boosting the effect of mRNA vaccines in general. I guess there's building up some value in your ownership in AdaptVac. Is there something you can do to highlight it more?
We are using AdaptVac's VLP technology in our breast cancer vaccine asset. AdaptVac is just as much as ExpreS2ion proud of having the platform validated in Bavarian Nordic's COVID-19 phase III program in the COVID-19 space. That said, AdaptVac has been very good in making some important announcements this year on grants they have obtained, one from CEPI and the EU to cover viral virus vaccines, and another one very recently from the Japanese Foundation, which is funding a very important malaria research program. AdaptVac is really also having momentum in their own rights on gaining non-dilutive funding. ExpreS2ion, of course, still has our 34% stake, which we'll maintain and work together with AdaptVac on opportunities that emerge.
I guess you face a lot of investors all the time. Have you seen any loss of interest in the vaccine field after RFK Jr. and the more negative U.S. view on vaccines? I guess it's not actually the cancer vaccines and the bigger vaccines. Do we feel any hesitance by investors when you mention you as a vaccine company?
That's a very good question. It's interesting that vaccines have become the center of attention due to this new administration in the U.S. I think what we've heard from the Minister of Health or RFK Jr. is, in a way, if you look at it, good for ExpreS2ion because what we do is working with protein-based vaccines. We have our platform, which shows great advantages when development of subunit protein-based vaccines. What RFK is negative around is actually mRNA vaccines. He has stopped 22 programs from being progressed with the governmental non-dilutive funding. That's, of course, serious for those mRNA programs. That doesn't really affect ExpreS2ion. On the contrary, I would say.
I'd like to just add that I think a lot of the devil is in the details on these because you're seeing broad comments in the press that are headline news. If you read the underlying comments, it's pretty specific what they're targeting. I encourage investors to look at that in more detail. Just to provide one little anecdote, we do see funding opportunities in the vaccine space and immunotherapy more broadly that could be potentially relevant from the U.S. It's not like it's been knocked out completely. It's very targeted.
Perfect. How many of the enrolled patients are on the combination? I guess you enrolled two patients, so I'm actually not sure whether you're allowed to say that.
I think the details won't be spelled out when we make announcements on the safety and efficacy on these enrolled patients.
What's important is that the amendment allows us to accelerate recruitment.
When do you expect to release some news about the deals with Serum Institute of India and WuXi ?
They are ongoing, so I cannot say any specific timelines, just that they are ongoing, and that's good. We are getting to know each other and progressing on the discussions to get to strategic licensing deals with them.
I think you already alluded a little bit to it. Will development costs increase in H2 as recruitment progresses? Keith, I think you'd alluded a little bit to it and mentioned maybe that the larger cost was the preparation of the study.
Yeah, I mean, what I said in the prepared remarks was that in the first quarter, our R&D cost was quite low as we moved away from the preclinical and the CMC activities and into the clinic. We had some clinical cost in there, but you know we've been pretty public about when we had our first patient, and the costs are very closely tied to the number of patients that are coming through going forward. Once you get past the startup phase, it's tied to the patients. It's going to be a factor of the number of patients that are under the trial at any given point in time. As I mentioned, there's a max of five under the current plan. Even once we've got all the five patients in at one time, it's not a huge level of cost.
There's a question here. I'm not sure we can answer anything on that. Are patients in the phase I study still responsive to existing HER2 treatments?
The patients we are enrolling now are in a stage where they've tried standard of care monoclonal therapy to no avail, but they are also importantly undergoing combination therapy with antibody drug conjugates. It's important that we can enroll those patients as well and thereby give them a benefit, hopefully, for these patients.
There is a question about that we always, always get, and I'm pretty sure you probably can't comment on it. Do you see any increased interest from larger investors who want to fund this journey? I guess you alluded to it before that you are trying to seek larger investors to give more stability and fund the journey here. Any comments on the development here?
I think, Keith, you get the final word here.
Sure. I really don't want to encourage speculation. I would say that we have conversations all the time. We've been pretty clear about what we're aiming to do. Some conversations are positive and some are less positive. There's always a mix, and you have a lot of different mixes of sentiment. In my perspective, I think what we need to find are the investors for whom our platform and our pipeline is the right fit. That's an ongoing process.
Perfect. That was the last question. It's 11:00 A.M. I think we delivered on all the questions and on time. Thank you to you, Keith, and thank you to you, Bent, for taking us through your presentation and your results and for answering questions.
Thank you, Michael, and thank you, everyone else.