Ladies and gentlemen, welcome to the Immunovia Q1 Interim Report 2022 conference call. I am Alice, the Chorus Call operator. I would like to remind you that all participants will be in listen-only mode, and the conference is being recorded. The presentation will be followed by a Q&A session. You can register for questions at any time by pressing star and one on your telephone. For operator assistance, please press star and zero. The conference must not be recorded for publication or broadcast. At this time, it's my pleasure to hand over to Tobias Bülow, Senior Director, Investor Relations and Corporate Communications. Please go ahead, sir.
Thank you. Good morning and warm welcome to Immunovia's first quarter 2022. My name is Tobias Bülow, and I'm heading Investor Relations. With me today here in Lund, in Sweden, I have the Immunovia President and CEO, Philipp Mathieu, and our CFO, Karin Almqvist Liwendahl. I would also have the pleasure to inform you that we have our new U.S. CEO, Jeff Borcherding, with us as well today. Regarding the Q&A session after the presentation, I would already now like to ask you to limit your questions to two per person at the start, and then get back in line for a new round. Our operator, Alice, for today will guide you on how to ask questions. We will end at latest 2:00 P.M. For your information, this session will also be uploaded as on-demand on the web. With that, I leave over to Philipp.
Thank you, Tobias, and good afternoon to those investors dialing in from Europe, those who have joined us from U.S. I would like to welcome you to the Q1 call of Immunovia and thank you for your interest in our company. As an agenda for today's Q1 call, I intend to cover the following topics. First, the new sharpened strategic focus of the company and how already in Q1 we have executed successfully on the strategic priorities I set out in February during the Q4 call. Second, what were the operational and financial highlights of the past quarter? Thirdly, provide you with additional details how we plan to make IMMray PanCan-d, our groundbreaking test for the early detection of pancreatic cancer, broadly available in the U.S. by executing on our rollout and reimbursement.
The shift from being a research and development-focused company to being an early commercial company is a fundamental gear change for any organization. In August 2021, IMMray PanCan-d was launched as the first to market dedicated blood-based test for the early detection of pancreatic cancer. This event established two things. First, we became the front runner in innovative early detection of pancreatic cancer. Second, Immunovia entered the U.S. as the largest and most profitable diagnostic market in the world. Success at this critical stage of a company's development requires absolute focus on execution. Building on our position as the front runner in pancreatic cancer testing, we will from now on focus all our resources on that particular market and the tremendous underlying opportunity. We will also focus on the commercial execution in the U.S., which holds huge potential for our product.
As a logical consequence, we have decided to deprioritize our discovery programs in autoimmune and lung cancer. Of course, we will look for options to leverage their value, but will not dedicate additional resources to those programs. In summary, fully focusing on our mission to revolutionize the early detection of pancreatic cancer for us means building on our strengths as the front runner in our field, concentrating on the successful commercial launch in the U.S., and executing on our previously stated U.S. reimbursement plan, which is absolute key to make our test available to as many individuals as soon as possible. Going forward, Immunovia will hence dedicate all its resources to pancreatic cancer and the U.S. commercial execution of our test. This is because with pancreatic cancer, Immunovia will purely focus on one of the largest unmet medical needs in cancer early detection and one of the most lethal cancers.
Early diagnosis is a game changer for pancreatic cancer patients, and with IMMray PanCan-d, we are able to provide this. As of today, pancreatic cancer survival rates are shockingly low at only 5%-9% at the five-year interval. In fact, pancreatic cancer tragically has the second lowest survival rate of all cancer types. Pancreatic cancer today is a devastating diagnosis for both patients and their loved ones. What makes a huge difference in pancreatic cancer is the timing of diagnosis. Enabling early detection in stages one or two allows for patients to have hope and to have options. At these stages, the cancer is still localized and surgically resectable. A treatment option and hope exists, and survival rates significantly increase to above 40%. This unfortunately changes very dramatically when the cancer is diagnosed later than stage one or two, which is the case for most patients.
The survival rate drops to only 3% at the five-year interval. Today, with the current surveillance and standard diagnostic methods, way less than 20% of patients are diagnosed early enough to have surgery as a treatment option. With our test now, we are able to meaningfully increase the number of patients who are diagnosed early enough and move that 20% number significantly upwards. IMMray PanCan-d, our clinical evidence, and most importantly, our first-to-market status in the U.S., positions us as the undisputed front-runner in innovative pancreatic cancer testing. There are two factors which really make a difference for IMMray PanCan-d as a game changer for patients. First, its unmatched performance characteristics. 99% specificity and 92% sensitivity across all stages have not been shown by any other testing method available today.
Most importantly, being able to have 89% sensitivity in early-stage cancer, the critical phase when there is still a chance for surgical treatment, is a huge benefit for any concerned individual. Other differentiating factors of our test are the convenience and the ease of use. Today's standard methods for pancreatic cancer diagnostics are imaging, mainly CT and MRI, endoscopic ultrasound, and biopsy, as you know. All of those methods are time-intensive, invasive, and costly. Our test, in comparison, is blood-based, can be performed at any physician office or even remotely at the patient's home, non-invasive, and does not require any anesthesia. Today, our test is the first ever commercially available test in the U.S. purely focused on the early detection of pancreatic cancer.
It is also the first blood-based surveillance test of its kind, and as stated, it is superior in terms of performance and cost versus today's standard methods. In summary, our test can make a fundamental difference for patient outcomes in pancreatic cancer. Turning over to Q1, what were the key milestones and what progress did we make? In February, we published the peer-reviewed blinded validation study. This publication provided independent validation of our test. In all our conversations with physicians, key opinion leaders, and patient organizations, we keep on hearing how well-received this publication has been and how it fully validated the performance of our test in their eyes. We also achieved CAP accreditation of our laboratory in Marlborough. This accreditation is a requirement for licenses in the five remaining U.S. states. Today, we are already able to sell our test in 47 U.S. states.
We can now pursue licenses for the five remaining states, most importantly, including California and New York. We are currently in the process of obtaining those licenses. During Q1 and also during April, we have also added significant new management expertise to the organization. A new CFO, a new commercially focused leader of our U.S. business, a new head of IR, as well as myself. Finally, we recently submitted the application for a PLA code. Now, 2022 to date has already been a year of focus and a year where we executed on our previously communicated strategic priorities. As I said during the Q4 announcement, it is my intention to be benchmarked throughout the year against those priorities. We will consistently communicate on the advances we are making against those. On four out of those five strategic priorities, we've made significant progress and delivered.
The first one is being advanced. Additional clinical validation was achieved through the publication of the peer-reviewed study. The hire of Jeff Borcherding to lead our U.S. business significantly strengthened our team over there and provided it with a commercial focus for a successful sales ramp-up in the U.S. This is just the first step in scaling our U.S. business. CAP accreditation and filing for our PAA code were advances in executing our U.S. reimbursement plan. Today's deprioritization of our autoimmune and lung cancer programs is a consequent step in order to provide the company with a laser-sharp strategic focus on execution, leadership, and fundamental success in pancreatic cancer. With that, I would like to hand over to Karin for a summary of the Q1 financials.
Thank you, Philipp. With only a couple of weeks within Immunovia, I would like to start by saying that I'm very happy to be joining a company with such potential and a team of very professional colleagues. Now looking at the financials for Q1, we see that revenue are at very modest levels, and it's also what we should expect going forward prior to we see the impact of a rollout of reimbursement. Earnings have declined compared to the same period last year, and the prime reason is that the company has completed capitalization of R&D costs and has now started to depreciate what is activated on the balance sheet. Having said that, our underlying OpEx is also increasing somewhat, which is a result of the focus to build our business.
Looking at our cash position, I'd like to point out that we are well-funded to manage operations and building our business for the foreseeable future. Back to you, Philipp.
Thank you, Karin. It's great to have you on board. As the company has now sharpened its strategic focus purely on pancreatic cancer, we're even more committed than ever before to broadly roll out our tests in the hereditary and familial risk group, but also as soon as possible, advance into the other risk groups. New onset diabetes and the symptomatic risk group represent a substantial additional market opportunity for Immunovia. In both risk groups, we are pursuing clinical plans to capture this opportunity and capitalize on our front-runner position in pancreatic cancer. Targeting the new onset diabetes group, we have PanDIA-I as a prospective clinical trial. As previously stated, we will provide an update on this later this quarter. For the symptomatic risk group, we have advanced our work with key opinion leaders to define the most promising clinical pathway forward following our Panzem-I trial.
Also here, we are going to provide clarity as soon as this work is concluded. In summary, Immunovia is fully committed on establishing itself as the undisputed leader in the early detection of pancreatic cancer across all risk groups. The most critical piece in making our test broadly available is our ability to attain reimbursement for our test. Where do we stand today, and how do we intend to get there? I'm pleased to say our plan is unchanged, but we have made significant progress during Q1. Recent milestones on our way to reimbursement insurance payments were the publication of the peer review validation study, broadly noted, as I said, by the KOL and physician community, receiving a CAP accreditation for our laboratory in Marlborough, which is a requirement for the U.S.-wide rollout of our test.
Also, as you know, we recently applied for a PLA code, which will provide a unique identifier code for our test used by healthcare providers and insurance companies. We did what we previously said. We initiated a physician experience program which is currently in its enrollment phase. We have the aim to have initial reimbursement and insurance payments before year-end. There are a couple of steps to achieve that. First, we are going to conclude the physician experience program over the course of this year. By the end of it, a broad set of surveillance centers will be familiar with the usage of IMMray PanCan-d. I strongly believe that they will play a critical part as advocates with payers for our test. Another step are the results from our Panzem study, which we expect from mid-2022.
Goals of the study are to assess the performance and diagnostic accuracy of IMMray PanCan-d compared to standard of care imaging. Obtaining a PLA code later this year is another step forward. We expect to have accomplished that during the second half of 2022, and the code, once granted, will be effective as of October 1st. With all of that, we plan to have discussions with payers throughout the second half of 2022. We have a plan to have initial reimbursement in insurance payments for our test before the year-end of 2022, and look at numbers which will increase in 2023. With that, all in all, I feel we are in great shape and positioned to execute on this plan. A bit more details on the physician experience program.
As we planned and communicated earlier, we recently launched a physician experience program targeted at high-risk surveillance centers in the U.S. Enrollment for this program started at the beginning of this month. We are targeting centers with high volumes of patients enrolled in their existing surveillance programs. As part of this program, we will provide up to 30 centers with tests at no charge. This program's goal is for physicians to become comfortable with broadly using our IMMray PanCan-d test and to make it a key part of their standard testing routines. Apart from adopting our test, physician will also provide Immunovia with imaging data for comparison. Ultimately, we want physicians to not only adopt our test, but also act as our advocates with payers and patients as we grow our IMMray PanCan-d brand in the U.S. Now, key for our success is the excellence and passion of our team.
I have to say, after my initial three months as the CEO of this company, on a daily basis, I continue to be highly impressed by the caliber and by the drive of our employees in both Sweden and the U.S. During Q1, we have further added considerable expertise to our management team that is crucial for this next phase of the company's evolution. With Karin as the CFO, Jeff as the CEO of our U.S. subsidiary, Tobias on the IR side, as well as myself coming on board, we've added sector-focused corporate strategic experience, capital market expertise, commercial expertise in launching and successfully scaling diagnostic brands in the U.S., and considerable experience in global finance and investor relations work.
Together, our team can draw on a wealth of experience that will enable Immunovia to strive and be extremely successful in this new chapter as a commercial growth company and leader in its space. With that, I would like to give the word to Jeff, who, as you know, joined us recently from Myriad to briefly introduce himself. Jeff will play an absolutely critical role in leading the scale-up of our U.S. business and making our tests broadly available in that market. Over to you, Jeff.
Thanks, Philipp. I am incredibly excited about this opportunity for a number of reasons, but two really stand out. First, you know clinically, it's an opportunity to make an impact for at-risk patients in an area of cancer that has not seen the same survival rate advances as many others. You know, too many are diagnosed late, too many die, and we can change that with IMMray PanCan-d. On the commercial side, it's an opportunity to build a great commercial stage company building on the incredible technical achievements by Carl, our founder, and the talented team in Lund to achieve similar greatness in the commercial space. This role really enables me to leverage more than two decades of experience building businesses and building teams, and it's a natural next step following the work that I've done before.
You know, most recently I was at Myriad Genetics as the CMO, leading marketing and product launches in oncology, women's health and mental health. Prior to that was the general manager and commercial leader for the mental health business. That was the Assurex Health business that was acquired by Myriad, where I led the growth of the GeneSight test, one of the fastest-growing molecular diagnostics in U.S. history. Those experiences really flowed from a foundation of commercial leadership, starting with P&G Pharmaceuticals and roles in other early-stage technology companies. As I come on board at Immunovia, I've really got three focus areas.
The first is working on making sure that we've got an effective and scalable sales and marketing model that looks at things like our targets, our message, and our tactical plan to make sure that we have refined that model and we are ready to scale it up for growth across the country. The second piece is reimbursement, not surprisingly. Continuing to refine our strategy there. We will build out our capabilities, hiring a reimbursement leader, and we'll continue to have additional conversations with payers to refine our message and make progress on reimbursement. Finally, I'm focused on building on this small but tiny talent and small but talented team in Marlborough that has put us in a position to succeed. I'll build on that foundation.
We'll bring in specialists in areas like reimbursement and add additional capabilities like medical affairs, so that we can really bolster our commercial presence and drive the volume that we need to make an impact in this market, both clinically and commercially. I'm incredibly excited about the opportunity here. The path is very clear, and I'm very grateful to have been brought on board to lead this effort in the U.S. With that, I'll hand it back over to Philipp.
Thank you, Jeff. I'm really thrilled to have you on board, and I'm very much looking forward to work successfully together with you in what will be a world-class team in the U.S.
In summary, as of today, we are fully focused and set to capitalize on the tremendous opportunity the company has with pancreatic cancer. Already today, the company has established itself as the leader in innovative early detection of pancreatic cancer. In my view, that is a very strong base from which we will build. We have all it needs to succeed, and succeeding for us means saving patient life as well as rapidly commercially scaling our unique test in the U.S. With that, I would like to lead over to the Q&A part of the call and invite for questions.
Thank you, Philipp. With that, we conclude the presentation and move over to the Q&A session. Operator, please go ahead.
We will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on the touch tone telephone. You will hear a tone to confirm that you have entered the queue. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use only handsets when asking a question. Anyone who has a question may press star and one at this time. Our first question comes from the line of Peter Sellei with Erik Penser Bank. Please go ahead. Mr. Sellei, your line is open. You may ask your question.
Peter?
Peter Sellei from Erik Penser Bank, your line is open.
You might need to move on, and we come back to Peter later.
Thank you. I remind participants once again to ask a question, please press star and one on your touch tone telephone. Star followed by one. Trying once again with Mr. Peter Sellei with Erik Penser Bank. Mr. Sellei, your line is open. Mr. Sellei, your line is open.
Hello, Philipp. Peter Sellei with Erik Penser Bank. Really enjoyed your presentation, and it looks really good from my horizon. Could you just please outline what is the commercial potential for these tests? Basically, what are the potential market size for your test? Thanks.
The commercial potential for our test is the same we communicated in the past. We're still targeting, as I said, three risk groups. The one we're already commercial in, the familial risk group, inherited risk group, and also the new onset diabetes risk group and the symptomatic risk group. With all that together, our assumptions for the U.S. market as the first market we are commercial in still stands at the previously communicated numbers.
Okay, great. A bit on the potential in other geographical areas. I'm fully aware that you're very much focused, and should be focused on the U.S. market. For the investment community, I think it's also important to know the full commercial potential for the test.
Absolutely. Thank you for that question, Peter. As you know, commercially, our absolute laser sharp focus for the foreseeable future will be the U.S.
That doesn't mean we neglect other markets, and as I communicated during the Q4 call, we are currently undergoing work to prioritize those markets where we see potential. There are various markets where we see potential. Now we're weighing the market size and the prospect in those markets for our tests against return on investment, and we'll later this year communicate what we prioritize in those areas.
Okay, great. Thanks.
The next question comes from the line of Michael Löfman . Please go ahead, sir.
Hi. Two questions really. Regarding the experience program for physicians, can you guide us on what that actually means in practice and what you expect to get out of it going forward? Also, regarding the cash position, you have enough for the foreseeable future, but in the future, I guess you'll have to raise cash, perhaps, given your plans. Would that include perhaps the U.S.? Thank you so much.
Thank you, Michael, for your questions. The goals of the pioneer program are the following. First of all, we wanna drive adoption of our test in the U.S. We wanna build a brand. That starts with increasing familiarity of providers and doctors being comfortable ordering the IMMray PanCan-d test and interpreting the results. This will drive adoption for further clinical understanding of IMMray PanCan-d and also make doctors comfortable using it in the future. It's very much, as I said, about building a brand, and all of that together will enable us to broadly roll out our test in the U.S. during the course of attaining reimbursement later this year and beyond. The KOL development is another area.
The surveillance centers we're targeting with our tests are not only high volume surveillance centers with a lot of patients enrolled, but also surveillance centers where there are KOLs or key opinion leaders, as we say, who are running those surveillance centers. I think those key opinion leaders will be a critical part as we aggregate additional clinical evidence and build our case with reimbursement and payers throughout this year and next year. On the cash position, Michael, on your second question, yes. We feel very well capitalized, as Karin said, to pursue both our near and mid-term plans, including the U.S. We continue to be opportunistic as we look for financing options that might include equity financing and other things, but that will be decided at the right point in time and depending on market conditions.
As a reminder, if you wish to register for a question, please press star and one on your telephone. Star followed by one. There are no more questions from the telephone at the moment. Mr. Bülow, back to you for the webcast questions.
Yes. We have received some questions through the web interface. Starting with Lars Hevreng, Equity Analyst at Danske Bank. Please comment on the scale-up of the commercial organization this year and next year.
Thank you, Lars, for submitting that question. Yes, as I said, U.S. scaling and equipping our U.S. organization with the right talent is a key focus for Immunovia. There are certain functions which we continue to build, obviously on the sales and marketing side, but also on the reimbursement side as we increase our focus to the U.S. and increase our scope also of our relationship networking with payers. There, there's a lot of capital investment which will go towards the U.S. over the next two years. Jeff being on board now for two months will be a key part in designing that strategy going forward.
Thank you. We continue with the question from Lars. What is your current view on the U.S. target population for the first indication?
The U.S. target population hasn't changed. Of course, things like the physician experience program, things like our work with patient advocacy groups, things like discussions on guidelines might lead to a renewed view or updated view in the future. As of today, we have to say we substantiate what we've discussed and announced in the past around the market size for the initial familial hereditary group at $500 million in the U.S.
Okay, we continue. When can you capitalize on the Panzem trial, particularly in the U.K., where a large portion of the trial has been done?
On the Panzem, on the Panzem trial, as I said, we are currently in advanced discussions with key opinion leaders. How we follow up on that concluded Panzem-I trial and how we exploit the symptomatic risk group, which we see as a substantial future market for the company, and we'll come back later this year on exact plans to tackle that risk groups on a clinical pathway.
Regarding what portion of your initial target market can be covered by the 30 early experience program?
The pioneer experience program is less about market coverage. It is about adoption and brand awareness for our test. That's, I think, the context in which you have to see it.
Final question from Lars. Any cost savings related to the mentioned deprioritized areas?
Of course, as for the pancreatic cancer, some of our R&D programs have concluded. On the discovery side, there are some cost savings which will materialize. To what extent those will materialize in numbers, we have to see. The one thing to note is we will not dedicate additional resources. Overall, over the last year, the capital outlay for the discovery programs was marginal.
Okay, thank you, Philipp. As there seems to be no questions left, we will now conclude the call. Thanks for joining us today, and welcome back next quarter.