Good morning. Welcome, everyone, to Flerie's Q3 2025 report presentation. I hope everybody has had a good morning and have got your coffee. We are in for a good ride to talk about several of our companies today. First, a disclaimer, of course. Please act accordingly. A little reminder, of course, I think Flerie is well known now. We have 27 portfolio companies, 71% in private companies. You can see the division: six in preclinical stage, six in early clinical, nine in clinical stage, and six in commercial. Actually, you know, quite a significant over half of our number of companies are in late clinical or commercial stage. Quite a mature portfolio and certainly diversified portfolio. We operate as an evergreen investor, as you know. We're long-term and we have a very specialized team, and we always invest with others around the globe.
Today, of course, we're talking about the Q3, and it's all about reaching milestones and gaining traction for our portfolio companies. That's what we're driven by. We know, as well as any investor should, but not all do, that financing and R&D progress really go hand in hand. It's not enough to just have fantastic development in your companies. You've got to be out there networking, meeting others, and also ensuring that your companies get financed. Let's talk a little bit about examples of that. First, our current asset is that net asset value is just shy of 4 billion crowns. That's SEK 50.58 per share. We have cash and cash equivalents, about 13% of that, now SEK 511 million. The significant events and the value changes during the quarter are listed here. I'll go through it briefly. Symcel and Xspray are really something to highlight.
They've both closed deals, of course, after the quarter. Xspray has had a setback. We will talk about that as well. I'm happy to answer questions. During the quarter, a fantastic development for Xspray. Completed merger with Toleranzia as well. That's us, ourselves, Flerie fused with Toleranzia. One of our companies that was publicly listed is now Bonsai Biotherapeutics, a private company. We've done what a lot of people talk about, but very few people do. I think it's quite an innovative take-private maneuver that Cecilia can talk a little bit about and answer questions on. KAHR Medical also secured SEK 20 million. This is one of several capital raises successfully closed. We've also had our first implementation of share redemption scheme. That's our share redemption scheme in Swedish. After the quarter, Nanologica secured entry into China's insulin market.
Quite excited about that commercial development in Nanologica in a space that is actually growing quite a lot with all the peptide drugs around obesity that are coming to market. Xspray Pharma's FDA approval was delayed. Those were observations of its contract manufacturer. I was on the Dagens Industri TV this morning, and I explained a little bit about that. If you haven't seen that, ask a question in the Q&A, and I'm happy to answer. Lipum has also decreased in value, and KAHR has decreased a little in value because we did a fundraise at a slight down round. We did strengthen our position in KAHR Medical. KAHR, how did it secure SEK 20 million? We got strong support from our co-investors, Peregrine, Amoon, and Cancer Focus Fund, as well as others like Oriella. We also welcome a new investor into our strong syndicate, and that's Spring Global Investments.
They have offices in New York and Singapore. Welcome Spring to this very good and strong syndicate that will help KAHR Medical get through their very focused colorectal cancer clinical study. We're quite excited. The data was published earlier this year from the previous study. It's looking very promising indeed. In a very unmet medical need, it's actually growing tremendously. Colorectal cancer, unfortunately, even early-onset colorectal cancer is growing. Younger and younger people are getting it. This is a problem, of course, that we're trying to solve with KAHR Medical. How do we do that? It's a patented solution to treat colorectal cancer, the so-called Multifunctional Immunotherapeutic Platform, or MIRP for short. It works for both solid and hematological malignancies. For those of you not familiar with that term, essentially solid tumors or blood-borne cancer. That's what hematological malignancies are.
In the depiction at the bottom, you can see that you have cancer cells. The body has its own immune cells that need to find those cancer cells, recognize them as being, you know, malignant or diseased cells, because these are our own cells. The immune cells have to recognize that and remove them. What MIRP does is essentially connect those two and help the body's immune system to remove cancer cells. Quite exciting, patented solution that has very good patent coverage for quite some time. A little bit more then, we're catalyzing significant investments as we did in KAHR, but also here you can see Xspray and Alder Therapeutics during the quarter. Flerie put in SEK 23 million when Xspray actually secured a total of SEK 161 million. In Aldha we put in a little less than half of what Aldha secured.
Obviously, a small amount in Aldha, but it's a very early stage company as well. In total, our syndicating partners invested SEK 205 million alongside our SEK 65 million. I think that's proof of our continued ability to get what our companies need without having to pay for all of it ourselves. Steady R&D progress is the key. As I said, they go hand in hand, financing and R&D. Symcel entered into a strategic R&D collaboration with Johnson & Johnson. That's a giant on the global scale. Of course, they're advancing this rapid sterility testing that Symcel is able to transform. I'm very excited about it. They're measuring the heat of cells, and they're measuring so precisely that they actually may be able to turn sterility testing from days into sort of 24 to 48 hours turnaround. It could be revolutionary for how we manufacture, for example, cell and gene therapies.
Turning to the right, Xintela presented positive 24 months data in knee osteoarthritis. I've spoken about this before, but now we finally have proof that it's not only ameliorating pain, but actually some of the data that Xintela has is showing that they're improving bone and cartilage structure. If this turns out to really be proven in a larger study that they now need to do, then you'll be able to have a game changer because you're changing the joint, actually improving joint function rather than just ameliorating pain. Bottom left, Genius Therapeutics. Just taking a bit of water. Genius Therapeutics, their patients have aggressive brain and liver cancers, and they've been treated for several years now. Because we've followed these individuals for five years, we can now say that there has been no recurrence of the tumor during five years. That's an amazing achievement.
These are patients that normally would only live a few months. Prokarium finished dosing all of the cohorts in a non-muscle invasive bladder cancer. Bladder cancer comes in several different forms. First, it's not invading the muscle, then it invades the muscle, and eventually patients have to remove the bladder entirely. The standard of care is something called BCG, and we've actually shown improvement in a lot of valid models that we're actually much better than BCG. Prokarium has the potential to be a real game changer for bladder cancer, which is actually the seventh largest cancer in men. Now let's turn over to the numbers. Cecilia, tell us a bit more about the quarter.
Yes. Thank you, Ted. Right. Now I can go without an echo, hopefully. Sorry about that. I will go through the financial development in the quarter. This is a quarter Ted already outlined. A couple of comments on that. We had our first redemption related to the redemption scheme. We also carried out a share issue in connection with the merger with Toleranzia. It was a quarter where we saw positive share price development for a few listed companies, but also decreased valuations for both listed and unlisted shares from financing rounds and a couple of write-downs as well. Next slide, please. Before we look at the actual numbers, a few words on our valuation methodology. The listed companies, as we know, are valued at the latest share price, and the private companies are valued in accordance with the latest funding round.
There are cases, though, where we feel the need to adjust the value for a private company and deviate from the valuation in the latest round. For instance, these cases can be where we see a negative result from a clinical trial for a portfolio company or where a company doesn't meet its sales targets, for instance, or report continued losses. In Q3, we could see such cases, and therefore we have written down the values for Synerkine, Sixera, and Bohus Biotech, which all in all decreased our NAV by SEK 104 million. We can go to the next slide and look at the numbers and the development in the quarter. The net asset value, the NAV, was a little bit over SEK 3.9 billion end of Q3 and SEK 4.1 billion end of Q2. It's a decrease by SEK 203 million in the quarter.
The change is explained by, firstly, in Q3, we had the redemption of shares, a redemption scheme, that reduced the NAV by SEK 195 million. As Ted mentioned earlier, we had the merger between Toleranzia and Flerie that closed. As merger consideration to Toleranzia's shareholders, we issued new shares at a value of SEK 131 million. To that, we had a change in fair value of the portfolio of minus SEK 124 million in the quarter. We will come back and explain further details later. NAV per share was SEK 50.58 as compared to SEK 52.78 end of last quarter. It's decreased by SEK 2.2 per share. As you can see, in relation to portfolio fair value in the chart to the far right, we had a portfolio value end of Q3 that was almost equivalent to that of Q2, only a small decrease by SEK 8 million.
This is the reason for the changes. We had a negative change in fair value, as I mentioned earlier, of SEK 124 million. We made divestments primarily related to Toleranzia shares prior to the merger. In total, the divestments decreased the portfolio fair value by SEK 91 million. We made investments in the quarter of an additional SEK 206 million. This also includes the SEK 131 million of newly issued shares from the merger of Toleranzia and Flerie. If we go to the next slide, please, we can dig into the segments more in detail. Here we have the key financials or key numbers for the three segments: product development, commercial growth, and limited partnerships. The product development segment had a total portfolio value at the end of Q3 of SEK 2.450 billion as compared to SEK 2.453 billion at the beginning of the quarter. It's a decrease by only SEK 3 million.
The change in fair value in the quarter was negative, SEK 107 million. The changes, again, were explained by the write-downs of the value of the private companies, Synerkine, SEK 59 million. This was due to difficulties to secure the additional financing for upcoming clinical studies. Also, Sixera, - SEK 29 million, due to unfavorable results from a clinical study. We also saw low valuations in connection with the funding rounds for KAHR Medical and Alder, together SEK 51 million negative. However, this was offset by a positive share price development for Xspray Pharma that increased SEK 91 million. In the quarter, we invested SEK 195 million in the segment. This includes the SEK 131 million of issued shares from the merger of Toleranzia and Flerie. No cash investment for that. We divested shares at a value of SEK 91 million. Of that, the Toleranzia shares was around SEK 82 million of that.
Continuing to the commercial growth, our commercial growth segment had a total value at the end of Q3 of SEK 530 million to be compared to SEK 545 million at the beginning of the quarter. It's a decrease by SEK 15 million. The reason for the decrease is a fair value change related to the write-down of the value of the Bohus Biotech shares following delays in sales growth and profitability. Limited partnerships had a fair value at the end of the quarter of SEK 106 million. We made investments in the quarter of SEK 11 million into that segment. That wraps up the financial section. I hand over back to you, Ted.
Okay. Thank you very much. I hope everyone can hear me. Let's move on to some conclusions. Obviously, you can see from the slide what a diverse portfolio we have. We've shown it before. We have a lot of companies. We've had the feedback from some of you shareholders and others that it's sometimes difficult to get an overview of everything that we're doing. It's very exciting, but we've got a lot of companies. Today, you've obviously seen, you've seen, you know, just a handful of companies or two handfuls of companies that we've talked about. I just want to leave you with a few, basically five messages. If there's five things that you should remember from what we've talked about today, it is that Prokarium finished dosing all cohorts of patients within non-muscle invasive bladder cancer.
That may sound like, okay, that's business as usual, but it's actually quite difficult to run these clinical studies. We have teams that are working really, really hard to do that. Some companies fail. That's when we write them down. Prokarium is actually doing extremely well, has delivered on time, and has the potential to replace standard of care BCG in the future. Genius Therapeutics, with these aggressive brain and liver cancers that have been treated with personalized immunotherapy, so where the tumor is actually analyzed for any surface antigens, and then a personalized immunotherapy given back to that patient within a few weeks. The patient stays on that for several years and never has the tumor recur. That's an amazing achievement. Xintela presenting their 24 months data for the stem cell product in knee osteoarthritis. Again, this is a stem cell company.
This is truly innovative work that very few people in the world can do. Sweden is actually a place, Xintela is based down in Lund. Sweden is a place that has been a pioneer in stem cell development for many, many decades. Remember that we're doing really fantastic, innovative stuff. Symcel on the commercial side, we have a team here at Flerie that's helping them. Of course, Symcel's team itself has done all the hard work for years, talking to various partners and keeping those interactions alive. Now there's proof that, for example, a big player like Johnson & Johnson wants to collaborate with Symcel. This is really a test for, you know, the commercial capability of Symcel. Last but not least, in difficult financing times, our companies are able to gain financing. KAHR Medical managed to raise SEK 20 million, secure SEK 20 million. I think that wraps it up for today.
We're very happy to answer any questions on any of the other companies, any of these, or indeed all of our portfolio. Thank you very much. Look forward to Q&A.
Yes, hello, and welcome to today's Q&A session. My name is Paula, and I will be your moderator. If you have any questions, please click on the raise your hand icon on the toolbar. I will then activate your microphone when it's your turn to speak. Thank you very much. Let's see, we have our first question from Linus Sigurdson.
Okay, thank you. Perfect. Apologies if these questions have been addressed. I had some issues connecting to the call earlier. Looking, for example, at how indices have moved in this quarter, it seems the overall market is coming back to life in biotech. Is this something you're feeling incrementally in your discussions around potential fundraisers in your portfolio?
Thank you. Yeah, it's almost a question I'd like to turn around to you. Of course, my opinion is that, yes, we are feeling a change. The winds are changing, certainly in the public markets. I would say that in the private markets, a lot of the VC companies that we have co-invested with have indeed struggled to raise their funds in the past, especially the smaller ones. Generally, we analyze a lot of trends during the summer, and as a team, the main conclusion we can make is that there's actually being more money spent in this sector, but into fewer companies. Basically, there are very large rounds being done rather than a lot of smaller rounds. The effect that that has is that you've got to work even harder to syndicate to get larger rounds done. We're good at that.
I think we're feeling that there is indeed light at the end of the tunnel when it comes to what you've just said.
Okay, that's helpful. Would you say that implies that you could see your own portfolio becoming slightly more concentrated over, say, the coming one to two years?
Yeah, so I think that's always part of the model, actually. I think hopefully I've been clear about that in the past, that biotech is hard. Not all companies will succeed. Naturally, what any investor should do is to have a diverse portfolio, invest in a lot of different innovative companies, all of which you believe in when you make the investment. Of course, as time passes, some companies will have successful clinical trials, others will not, and they fall away. Naturally, you will go through these cycles of concentrating the portfolio more and then expanding the portfolio again when you have an exit. I think that's just naturally what we do. We really do see that our portfolio has decreased already from 30 to 27 companies and may decrease further. It will expand again when we have an exit.
Thanks. That makes a lot of sense. My final question, if you could just give some color on the write-downs that you carried out in the quarter, what were the main considerations going into those discussions?
Sure. I'll start with giving the high-level view, and then Cecilia can jump in on any figures. Essentially, Synerkine is a Dutch company that we've invested in the chronic pain space. We think it's a very necessary area to be in. The truth is, in this funding environment that it's been, people do not generally want to invest in something that's not easily translatable from preclinical to clinical. The nature of pain is that, you know, the way a mouse feels pain or the way even a monkey feels pain is very different from the way humans feel pain. Essentially, almost anything you do preclinically doesn't necessarily de-risk what happens clinically. A lot of partners are quite skeptical of moving ahead. We just found that we couldn't, on the whole of it, move ahead anymore with Synerkine. That was not just us.
That was the syndicate of investors in that company. That's why we had to write it down. We're conservative. It's not impossible that something could happen in Synerkine, but we've written it down as early as we made that decision. That's actually a promise to our shareholders that we will always follow this conservative valuation methodology. On Sixera, it was, as Cecilia mentioned already, actually a clinical failure. I would say it was a confusing output from that clinical trial. Again, we agreed with all of our investors that it was not worth to carry on with the original plan. We've actually brought it down to zero. We are looking at opportunities to somehow make something out of that company nonetheless. It's not a complete write-off. In Bohus Biotech, it's definitely not a write-off. It's simply that it has not performed as well as we had hoped.
It was already quite low valuation. Cecilia, how much did we, what was the valuation and how much did we write it down?
Sorry about that. For Synerkine, the write-down in the quarter was SEK 59 million. For Sixera, it was SEK 29 million. For Bohus, it was an additional SEK 17 million. By that, we wrote down all the values to zero for these companies.
Okay. Thank you very much.
Perfect. Thank you. Our next question.
Thank you for taking my question. I have two questions, one related to your private company, one to a listed company. Would you please give us some guidance on Empros Pharma and what is your next step given the very tough competitive environment in the obesity space?
Yeah, certainly. Let's talk about Empros. I think you had a second company you mentioned as well. I'll answer Empros first. We've been in Empros since 2014. We invested in that company before the obesity space became really hot. That's why we've been able to make essentially a phase III ready company. In terms of competition, we're quite far along. There are indeed a lot of other solutions out there, but they're early stage. Obviously, you've got the big ones. You've got Novo and Lilly who are selling because they've basically changed the diabetes drug into an obesity drug. It's an absolute blockbuster. We see that as positive, actually. We don't see that part as competition because precisely Empros is in a space where it can essentially be a weight maintenance drug eventually. We've positioned it as that. The company will actually have a readout relatively soon.
I will not be able to make any statement about what that readout is at this point for obvious reasons. We certainly think it's positioned itself well. You're right. It is a difficult area to compete in. If you have something that is different and fulfills a niche, there's certainly an opportunity and maybe even a great opportunity. I hope that answers your question.
Yes. The side effects, or do you think these are limited, although you don't have a readout now, but compared to what you see in the competition, which I understand are quite some side effects to people I know are at least using this Ozempic, etc.
Yeah. Side effects with Ozempic are obviously, you know, they're quite nasty to some people, a large proportion of people. You're right. There are a lot of people who can't take it. Therefore, they could take Empros EMP16 drug because it's a very different mechanism of action. It's also combinable with the GLP-1 drugs. If your question is around the side effects of EMP16 itself, again, I cannot make a statement about that right now beyond saying that the study that they're currently conducting and will read out is precisely done to address those. Obviously, we're in for an interesting, you know, readout when the company actually publishes that.
Okay. The second question I have is related to Lipum. I know that you are trying to raise funding for the next study here. How do you look upon your position given that you're quite a dominant owner in Lipum? How do you foresee your future position given this significant round of capital raising?
Yeah. I myself am not on the board, and nobody in the Flerie sort of decision structure is on the board. We have a Senior Advisor, Carl-Johan Spak, who's on the board of Lipum. Everything I tell you is based on public information that we know ourselves from the public database, so to speak. It's clear from their reports that they will run out of money at the end of the year. We are 56%, almost 57% shareholder in Lipum. We didn't actually want to become such a large shareholder, but we believe so much in this company and what they're doing, and they've done it right well that we've actually picked up the tab on a few occasions when we felt that others should join. I think as you'll see, again, this is public information.
Obviously, I would never comment on our own share price, but I can comment on Lipum's share price having come down by almost 30%. We believe in this company. We think it's actually a good opportunity to invest, and we would encourage people to invest alongside us in the future of Lipum because they have, you know, really the next trial is something where they will be able to carry. They've already, you know, dosed eight actual rheumatoid arthritis patients and shown that the safety is good, that they can inhibit the BSSL mechanism, which is the target of their drug. The next trial will actually be a really significant trial, and it will be a great pity if they cannot raise the money to achieve that. We will, of course, try to support that in every way we can.
Okay, thank you for taking my questions.
Thank you, Eric. I hand over to Ted.
Thank you, everyone. Appreciate you joining and look forward to the next one. Have a wonderful day.