Hello, and welcome to the Orexo Q3 report for 2021. Throughout the call, all participants will be in listening only mode, and afterwards there will be a question and answer session. Today, I am pleased to present our first speaker, CEO Nikolaj Sørensen. Please begin your meeting.
Thank you very much, and welcome to this third quarter presentation for Orexo. Some of you will notice who have been following us for a while, we have chosen a new format for our presentation, and I hope it's something that you will appreciate. I will start on page number two with the agenda. I will talk a little about the key achievements during the third quarter. Then I will continue talking about the U.S. pharma progress. But I know based on the number of questions we have received prior to the call, during the morning that there's a lot of focus on digital therapeutics. We have invited Dennis Urbaniak, who will join us from Chicago, where we have a kickoff meeting with part of our workforce for the sales of MODIA.
Dennis, as you know, is responsible for our digital therapeutics, new business franchise. Dennis will join us and talk more about that. I will then talk about our pipeline and, Joe DeFeo will take over talking about the financial situation of the company before I will, finish up with some legal updates and our future value drivers. Moving into the key achievements for the quarter on page five. I actually think that this quarter on the foundational element for Orexo is a really strong quarter. We have a Zubsolv development where we have seen, for quite some time, a kind of sliding or continuous decline in revenues.
While we did get a little help from some one-time effects this quarter, we actually see a development where it's basically flat for Zubsolv and overall in net revenues, we have +8% this quarter. In addition to that, we also have an EBIT margin from Zubsolv, which is now actually higher than it was one year ago. This is really important for us because the Zubsolv revenues and EBIT is what is fueling our investment into digital therapies and to the pipeline. When it comes to digital therapy, we are making some good progress with the signing of new partners. Just in this quarter, we have three partners that we have announced and we're making good progress in discussions with other partners.
One of them is Benefis Health System, a Montana-based health system of similar size as Trinity Health. We have Just Mind, which is a more virtual caregiver in the Chicago region. Then we have Sober Grid, which is the world's largest online community for people with substance abuse issues. The two first in their first steps, Sober Grid is making some really good progress, and we have seen some of the first patients coming through the Sober Grid partnership. We will now in our digital therapies we have basically been forced since we started with MODIA in the autumn of 2020 and late spring with deprexis this year we've focused on the direct to consumer promotion.
Partly because the lack of reimbursement pathways to caregivers and to insurance companies, and partly because we saw an opportunity in our very targeted direct to consumer promotions using social media. As some of you will recall from our Q2 call, we have faced some challenges doing the targeted media approach for our product. We've during the summer decided now to focus on the B2B segment. That would mean that we are now reducing our activity level in direct to consumers to focus much more on caregivers. What we're also seeing during the last 1.5 year is, like everyone else, we have had a severe issue of getting to the customers due to the COVID-19 restrictions. We see much better selling process when we're able to meet the customers face-to-face.
That's what we see in the healthcare providers right now, that we can actually meet them, and that accelerates the process significantly compared to before when we have more Teams and Zoom meetings. OX124 is basically in pivotal trial right now. We're expecting the results quite shortly. We are now expecting the launch in 2023, probably during the summer if you look at the current timeline. That product is quite exciting because the technology all the way from the formulation to the use of a device is something that we have gained a lot of insight and we will continue to see new opportunities springing out of that technology platform, something we will talk more about later in the quarter, which is this new R&D technology platform.
Please be aware that we think that there are a lot of new, quite exciting opportunities coming out of the technology that we're invested in behind OX124. Going into the U.S. pharma presentation, and then I'm moving to page seven. We've seen quite stable overall development in Zubsolv. We got reimbursed by Kentucky in July first, in the beginning of the quarter. That resulted in 85% increase in the Kentucky number of prescriptions in the quarter, admittedly from a relatively low level, but it is a quite good start. We also see some good growth in other Medicaid accounts like Ohio, is another very large state where we've seen good development in the quarter.
On a year-over-year basis, we've seen some of the largest PBMs like CVS, Caremark, and Express Scripts also showing some decent development. However, that of course is counterweighted by some more negative development on other accounts. We still see some decline in UnitedHealth Group and Humana, even though it's on an absolute basis, it's the lowest decline that we have seen since we lost reimbursement in the first half of 2019. What you will recall probably from previous meetings also, we've had a situation where the field force literally right after the COVID-19 in April, May of 2020, we saw a decline in our field force activities with more than 80%.
That has continuously improved, but we still see that the access to prescribers is less than we saw in the pre-COVID level. For that reason, we have actually decided to consolidate some of our sales districts, for starting now in Q4. You will see an effect on the cost basis from that, a little in Q4, but predominantly from next year. If you look at the overall market, moving to page number eight, we've seen the market growth has slowed down a little compared to what we have been used to where we've seen double-digit growth. But when you look at, all data in the U.S. show that the issue with opioid use disorder is on the rise, a quite dramatic rise when it comes to overdoses.
Even when we look at people who are basically overusing opioids, that one has increased quite significantly. We're for the first time in quite a few years seeing an increase also in prescriptions of opioid painkillers. Some of that probably because people have had to wait longer time for surgery, so they have been forced to use painkillers while they've been waiting for surgery. Unfortunately, we know that quite a few people when they're exposed to opioids over a longer period of time will grow into an addicted situation. What we see now. Why do we believe that there will be some good effect on the market moving forward?
As I said, the COVID-19 is something that has led to a quite steep increase in the number of people overdosing and suffering from opioid use disorder. We know that there are a lot of focus on both the federal and state levels to increase access to treatment all the way from quite strong lobbying groups who find that this limitation called DATA 2000 should be removed completely, which would mean that buprenorphine and naloxone products would be like any other medication and could be prescribed by all doctors in the U.S. Too, basically there are others who would just like to make it much more easy. That's already been done by President Biden. It's become more easy now to get that DATA 2000 certification compared to previously. We do see from a more Zubsolv perspective that our market access overall is improving.
We have had much less market access in the public sector compared to commercial, where in public we have now gone from 34% to 42% of the patients having unrestricted access to Zubsolv. We have seen a very little decline in commercial access by a few Blue Cross Blue Shield of Massachusetts plan that decided to put Zubsolv out of their preferred list. In the final part is what Dennis is preparing today in Chicago is the launch of MODIA, which is our digital therapy for opioid use disorder. We know already now from the first group of sales reps, we have basically been due to COVID-19, where you can't have too many people in the same room. We have started the education of field force last week.
Have the next group today and that final group next week. We've seen already now that adding MODIA into the calls is improving the length and quality of the call, the reps that have been out just a few days now with MODIA. With that, I will invite Dennis to give you an update on our digital therapies and what we are doing in digital therapies. Dennis, the word is yours. Right now I'm on page nine, so please take us through the presentation.
Thank you, Nikolaj, and good morning or good afternoon to everyone who's joining us today. As Nikolaj pointed out, the promise of digital health today is one of the most exciting areas in life sciences. Our segment of digital therapeutics is particularly exciting because it's highly relevant for the areas we work in, mental health and substance abuse. The opportunity to bring not only peer-reviewed clinical evidence in the form of trials, but also to demonstrate that evidence in the real world around the impact of the therapies is quite significant. Most importantly, digital therapies offer a way to truly focus on the patient and address those real gaps in the patient journey, particularly that we see in the businesses that we work in.
If you can move to slide number 10, this is not just Orexo recognizing this. I think if you consider the amount of investment that's been placed into the market in broader digital health year to date 2021, we see $21.3 billion. This represents massive enthusiasm for this trend that's coming forward. I think these two quotes here are a great descriptor of the current market dynamics. You see from McKinsey this opportunity that suggests that, you know, digital whether it be digital health or digital therapeutics, will absolutely become foundational in terms of care delivery as we go forward. There's no question about that.
However, today in 2021, there's significant opportunities in the infrastructure and the systems and processes that deliver care in the traditional format that need to be adapted to really enable digital therapy broadly to take hold and grow. That's the focus of the business right now is aligning to the significant enthusiasm and need, but also working aggressively to bring those systems forward where we can really drive these opportunities at scale. If you could go to slide 11, some reasons to believe and some confidence if you look at the actual market dynamics, and I'll talk about kind of two key areas on this slide. The first is from a provider and system point of view.
The fact of the matter is we're simply experiencing a level of demand and cost that's never been seen before. Certainly a lot of that's related to COVID, but on top of that, you've got an aging population. The traditional methods of care have been stressed at levels that they've never seen, and it's forcing institutions and providers of all types to consider different approaches and will be a foundational shift towards more value. Value-based care is perfect for digital therapy because of the way that evidence can be gathered, analyzed and collected to demonstrate true outcomes. We can align these new payment pathways and access models around value in ways that you simply can't with more traditional approaches. You have the system payer value effect.
The other dynamic here is with the individuals. We have people who are moving from this kind of passive patient mindset following the doctor's orders to being truly active consumers of healthcare. COVID has just driven an adoption of technology that is quite diverse. There's hardly a demographic at the moment that hasn't experienced some uptick in technology and has gained a comfort level. We've moved away from this idea of small groups of digital nomads that are power users to broad acceptance. These two underlying trends, system to value and the person to active consumer of healthcare, demanding more, are significant and will be real drivers of growth in digital therapy across the board. If you could go to slide 12.
What Orexo is doing now to position ourselves in helping to build that infrastructure as well as helping to demonstrate that impact is we're working closely in these two key areas. Establishing reimbursement is a high priority of ours, and we do that through our advocacy work as members of the Digital Therapeutics Alliance, as well as working with many other key influencers around identifying existing pathways that can be leveraged and also advocating for new approaches. I'll talk a little bit more about that in just a minute. Also as we're working to put those access pathways in place, you have to gain trust and confidence on the consumer side and on the provider side.
While we're building the reimbursement pathways, we're working closely with providers and with patients, so that they can develop trust in what Orexo is offering. They can get confidence by using the therapies with patients in real-world settings. Because of the data opportunities we have to demonstrate the impact of that, not only in clinical ways, but also when you look at cost outcomes and, most importantly, satisfaction, that will enable that acceleration, that real-world experience, and that's a big focus of our commercialization as we go forward. If you could go to the next slide, please. In order to deliver on this, you have to have good products.
It sounds kind of obvious, but with a lot of the new technologies that are out there's a lot of skepticism and a lot of question around what really are these products, these digital therapies, how do they work, and how will people like them? I can say with great confidence, our partnership with GAIA, a world leader with literal decades of developing high quality, highly effective digital therapies, puts us in a very unique position, a very positive position. We have this broad portfolio of assets from MODIA, taking on what Nikolaj described in his opening of the significant issue of opioid dependence in the U.S. following this prescription digital path with a big randomized trial underway at the moment, and then also an opportunity to drive early experience through the FDA Emergency Use Authorization.
MODIA will be truly integrated with treatment in that it's part of MAT driven by the doctor, medication-assisted treatment, so bundled with drug therapy, which is the standard approach for opioid use disorder. To vorvida, which is a very unique product, a terrific trial showing its effect, particularly in the area of binge drinking, which is a huge issue. This is a category that people don't really engage a lot with the healthcare system, but there's a growing problem in terms of alcohol misuse. The discreet nature and the opportunity to bring vorvida again under the emergency use authorization is a significant one. Finally, deprexis, which remains one of the most studied digital therapies in the world today.
Significant amount of peer-reviewed trials, and most importantly, in a number of different use cases and settings that demonstrate consistent effectiveness of the therapy, both as a standalone as well as a complement to core approaches. deprexis has already been cleared under the enforcement discretion pathway. On the product side, our CBT-based artificial intelligence therapies really stand out, and that's an area that we have great confidence in, and that's being backed up as people begin to use the therapies. The next slide. You have the products, but you also wanna make sure you're focusing in areas where there's true unmet need. If you look at each of our three areas of focus for each of the three therapies, both have this dynamic of significant and growing unmet need.
You can see very large population sizes in terms of those that qualify within our instructions for use areas, but also relatively low rates of treatment, meaning there's certain barriers that exist from the current traditional offerings. What that represents for digital therapy and for MODIA, vorvida, and deprexis are a true opportunity to help a lot of patients with some very serious conditions and really make improvements in people's lives in a very significant way while we also create that next growth engine for Orexo at a corporate level. You can see there's material sales opportunities here when you look at the size of the market and the opportunity to get more people into various forms of treatment and care using our digital therapies.
On slide 16, the next slide, we talk about how we're delivering that and how we're taking this promise, which you can see is so significant and now getting into, okay, now we have to execute. It's more than just telling people about the therapies and expecting them to start using them immediately. You need to deliver a full service platform that can adapt to the customer experience, whether that's a doctor or healthcare system, whether that's the patient or whether that's the payer. There's, you know, thousands of different types of payers in the U.S.
The system needs to be able to demonstrate and integrate your therapies into their current areas of work, needs to support the therapies through pull-through content, customer relationship management, and also needs to have data and activity and analytics to track the impact, everything from basic utilization all the way through those outcome measures that I had referenced earlier, clinical, economic, and patient satisfaction. We've been building this platform. We've been adding different segments. This is powered by leading technology organizations such as Accenture through the Google Cloud platform. We're attracting new innovators. Evidation Health, which is an exciting one of the world-leading real-world evidence organizations in the market today, has just joined with Orexo on a really unique opioid use disorder project as an example.
This is one of the reasons why, despite the huge need and enthusiasm, you don't see necessarily massive revenue uptake early, is you need to develop and deploy a platform like we've been doing. Back to that, customer experience, you need to earn the trust with your customers, get the confidence that they can see this works, and then you'll start to see the scale. On slide 17, the next slide, kind of like our therapies, while the technology is exciting, the technology does not matter if it's not delivering a relevant patient-focused customer experience.
One of the things we've also been able to do since the time that we launched in market with vorvida and deprexis is we have experience now in developing a number of different content assets and communication assets that align to the channels that most resonate with our customers. This is important because as we gain true access and reimbursement pathways, we can use our platform and our content to drive and accelerate pull-through. We can target these content assets very specifically to the channels that our customers prefer and the channels that our customers respond to. Our team, our marketing team and analytics team has done a great job of trying different formats, understanding what works, and creating a digital asset content library that allows us to deploy these quickly and customize these against those customer opportunities.
We're ready to drive pull-through using the marketing capabilities that we've built on the platform. Again, that goes back to ensuring that we optimize that patient experience. On slide 18, the focus for Orexo today and as we go into 2022 is going to be on partnering and demonstration. Here you see at the top examples of some of the partnerships that Nicolaj shared with you in the past in earlier earnings calls. Trinity Health in North Dakota continues to be a true foundational partner for Orexo in our commercialization efforts. It's a great example of what I talked about from a market dynamic. You heard from Nicolaj about Trinity much earlier in the year.
I'm sure many of you are wondering when we're gonna see the revenue impact from Trinity. With Trinity, we've worked through a process where first we've understood, after the initial kind of consideration phase and clinical presentation, how we could help their employees with our therapies to gain some of that initial trust that I referenced is the first phase. We've then over time, as they've gained confidence in therapies, been working with each of their care delivery departments, to set up the proper processes to make these billable services within their medical service delivery. That takes time.
You need to really understand how care is delivered from department to department, the nuances from primary care to behavioral health, for example, and the connection to the local payer environment, the setup of the right financial processes, and the demonstration of proper reimbursement and patient experience. We've also had to respect their schedules as the pandemic has evolved, as demands spike at different levels and things come up that you typically wouldn't expect, in a normal course of business. But what gives me great confidence is the feedback and response from the team at Trinity has been so positive. For me, the strongest example I can share with you is one of the new partnerships in Q3, Benefis.
Trinity, based on our experience with them, has begun to share with other systems the experience with Orexo and has actually been referring other like systems to us based on how positive they are about how we've supported them and how we're setting them up to ultimately be an innovator with digital therapy. Benefis is a new system, a neighboring system in Montana, similar size to Trinity, and we've already gone through the clinical presentation and already started an employee program in a significantly faster period of time on the back of that referral. We expect that to continue. This to me is another sign of confidence that I have that we have the right therapies, and when we can get the demonstration to market, we'll see the growth.
I'm also very excited about our partnership with Sober Grid, the largest recovery community in the U.S., very active across many areas. What we've seen so far, we just announced this partnership over the summer, but this combination of the peer coaching that Sober Grid brings along with Orexo's digital therapies is one that people are really starting to respond to. We're starting to see great introduction by the peer coaches to our therapies. Also though, we're starting to build a joint pursuit pipeline with the Sober Grid team because we've seen some examples of customer opportunities where our combined offerings create an even stronger value proposition. I think that that's gonna continue and grow and you'll see nice developments in terms of some new customers that we're winning together with Sober Grid. Also Just Mind.
We announced this one just a few weeks ago. This is another example of a partnership that I'm very excited about. This is a company that owns a very large primary care practice here in Chicago, a large brick-and-mortar practice. What's great about Just Mind is they take their platform, which is a broad digital delivery platform, which we are now integrating Orexo's digital therapies within that platform. They demonstrate the effectiveness of all their offerings within their real-world brick-and-mortar practice. Then once they show that, they then offer that nationally, in their business which they're scaling to employers. We're just getting started with Just Mind. We're just starting the work with deprexis and vorvida, in the Chicago practice. We look forward to watching that partnership grow.
Lastly, EBS, Employer Benefis Solutions. You know, that $21.3 billion brings a lot of companies and a lot of new offerings, and a lot of people decided they wanted to bring everything to employers. It's become quite a crowded market on the employer side. We have taken this partnership with EBS, who is a solutions broker. Their business is working with employers to bring novel health solutions to their employee base in value formats. As they're already there representing the best interest of the employer with a broad range of offerings, we're testing this broker model to see if that can help build our employer pipeline.
Again, I'm incredibly encouraged by the rapid development of the pipeline that they've put together and gives me great confidence that we'll see quite soon tangible opportunities coming from that. We have partnerships we've been building and we have new ones that we're putting forward, and you'll continue to see new partners from Orexo and digital therapy. For the last slide and to summarize, you know, what to expect from digital therapeutics in general and what to expect from Orexo as we go forward. There's no question that we're on the forefront of the next standard of care.
Our focus will be on new partnerships, specifically putting ourselves in position to gain that trust from customers, to gain that confidence through experience, to demonstrate the impact, and then to put the processes in place to enable broad access to large catchment areas, large patient bases. You'll see this through our work with Sober Grid as we expand that offering and that pipeline. You will see additional partners coming in at a faster pace as we can build this momentum of referrals and experience. The other thing though that's critically important for us is access is important. However, what builds a business is demand. We will be equally focused on as we gain tangible access in the market using our platform and our content assets to drive sustainable demand where we have access.
You'll start to see this with some first commercial patients coming through from some of those early partners that we're putting together. Finally, as Nikolaj mentioned, MODIA is just another incredibly exciting opportunity, tremendous area of unmet need. Medication-assisted treatment is the standard of care. However, there are real significant barriers, and the supply and demand here unfortunately is completely in the wrong balance. MODIA offers a patient-developed therapy through a sales force that knows opioid use disorder better than anyone in the market. We're very excited about getting the education out there, getting the initial trial, and we expect revenues from MODIA to start in H1 of 2022. Interesting market dynamics, a lot of great opportunity, enthusiasm, and a focus here on partnering and execution as we go forward.
With that, I'll turn it back to Nikolaj to cover the pipeline and headquarters.
Thank you very much, Dennis, and thank you for good presentation, BJ. I will go quite quickly through some of the next slides, so we'll catch up some time. I understand that the slides are coming a little slow on the webcast. If some of you are interested, the slides are now available on our homepage also. You can download them and control the pace yourself. Coming into our headquarters pipeline, the main asset is OX124. As you know, we developed them, that product as a response to the fast increase in overdose of fentanyl. Unfortunately, we've been a little ahead of the curve.
Moving on to page, and here I'll jump a few pages to page number 23, you will see the number of people overdosing in the U.S. have gone from bad to much worse. We've seen an increase during the pandemic of more than 30%. The most recent numbers here from, in fact the coming numbers just last week, I think for a period later, and it's just continued to increase in the U.S. What's really driving the overdose is the fentanyl crisis. We are right now doing our pivotal trial on OX124, and we expect to announce those results a little later in Q4. We see basically when we look at the market for OX124, it's today dominated by a product called NARCAN.
What is interesting to see that there are today only four states where there's what's called mandatory co-prescription of these products. With the overdose of opioids continuing to escalate, there's a lot of push to make mandatory co-prescriptions of these rescue medications across the nation. If that happens, this market is likely to grow quite significantly. We have seen in the states where mandatory co-prescription is mandated today that the sales is nearly 4x the average on the U.S. market. We have reasons to talk about OX124 much more later and particularly when we start to get the clinical results and get closer to filing in the U.S. With that, I will hand over to Joe to talk us through some of the financial results. Joe, please, start on page 25.
Good afternoon. I'll go over the financial section for the company. If you go to slide 26. On slide 26, if you look at the right side, you can see that we continue to have a very strong base business in the U.S. pharma. Sales have stabilized, as you'll see. Our profit is very strong, and we have an ever-increasing EBIT margin. That provides a strong base which will continue for our overall business, and it gives us the ability to invest in the businesses. We talked about the DTx business and OX124 in our pipeline. You could also see from that aspect, we have a very good cash position for the company, which gives us the ability to invest in these new business opportunities. Slide 27. This is our sales.
At the top you can see Q3 this year versus last year. There's a slight decrease in Zubsolv, which is at less than 3%. That decline has slowed dramatically. Most of this decline is due to those previous exclusive plans that were no longer exclusive in second half of 2019. When you look at the bottom, you could see Q3 versus Q2, we had a strong 8.2% growth. Now most of this is due to additional selling days and also some positive FX. You can see on the left side, the three bars, the decline in demand is very small. It's actually less than 2%.
Once again, we've been able to stabilize the U.S. pharma business, grow the sales in Q3, and deliver, as you'll see on the next slide 28, a good profit margin and a good EBIT overall. Focus on the bottom part, you can see that our EBIT margin continues to grow quarter-over-quarter, and now it is a high 57%. Also when you look at the EBIT bar, you could see that now we're growing that EBIT again. That EBIT has stayed up at a very strong level for many quarters. Like I said, we have a very strong U.S. pharma base and profitable base. Next slide, 29. This is our overall P&L. We talked about the revenues. Cost of goods sold higher than last year. This is mostly due to production variances.
It'll vary quarter to quarter. In Q3, our manufacturer was down for maintenance most of the quarter. The production buying was lower. The fixed cost over that lower production makes that cost higher, makes the cost of goods higher during the quarter. However, in Q4, that production will get ramped up, so we expect that to be offsetting in Q4 and have a lower COGS when we get to Q4. When you look at operating expenses, we do have higher legal expenses for the two cases that Nikolaj will talk about in a little bit. Obviously we're investing in our OX124 and also into our DTx business. What you can see when you look at the selling expenses, the DTx business launch of MODIA and what we've done so far, there's been a lot of synergies with the U.S. pharma business.
We've continued to look at expenses in our US pharma business and optimize those. You can actually see selling expenses down for the quarter versus last year. We continue to focus on our OpEx. We will invest where the opportunities are, but we will also look at our base spending to make sure it's efficient and we're not wasting money, so we can optimize where our operating expense is and also minimize our EBIT loss that we have currently. If you go to slide 30, this shows our cash flow. We have sufficient cash position. As you can see, liquid funds of almost 600 million SEK. Still strong, very strong cash position. This gives us the ability to continue and invest in DTx and OX124.
We did have negative contribution from operating activities, which is right around SEK 80 million. We continue to focus, as I said, on making sure we spend our money wisely and focus on the things that are gonna drive future revenue. With that, I will turn it back to Nikolaj for the legal update. Thank you.
Thank you very much, Joe. I will also underline that we are very diligent in the way we expense. We are aiming internally at having what you're calling recurring revenues should cover our recurring costs. We do investments, for example, in pivotal trial. Right now we have some extraordinary investments and legal expenses which are outside that. Looking at an overall company basis, we are actually in a quite solid position with a balanced P&L. We are doing some additional investments right now in clinical trials both for MODIA, OX124, and we have some legal expenses which are extraordinary.
When it comes to the legal update on page 31, on this patent dispute with Sun Pharmaceutical, that one is following the normal route. There's not that much to say except that we continue to strengthen our patent in the Orange Book. We actually started the process with five, and now I believe we have nine patents listed in the Orange Book. I think we have a very strong case. It's very difficult for us to go into any details of the case because all of the information that's in there is under what's called protective order. We can't really comment on that. I have said it before, but Sun Pharmaceutical is one of the most active ANDA, that means generic filers in the U.S.
They're basically filing a generic for nearly every product that is in the market. So that they decide to go on Zubsolv, I don't think it's based on a lot of analysis of the market. It's simply their strategy is to go quite broad in when they challenge these patents. Most of their cases are settled, but we'll see where this case will end up. So far this is definitely not keeping me awake at night. I feel that we have a very strong case in this patent dispute. When it comes to the subpoena, we haven't heard anything back from the giving us more insight into the background to the subpoena from the court.
We have had our own legal teams, actually two different law firms, who consist of former prosecutors who have gone through all of the material we have handed over to the U.S. government. So far there's no what you can say, red flags or concerns that have come up in that material. I know that we have been extremely diligent in the way that we promote Zubsolv since the beginning. I would be surprised if that come. I also realize in the U.S., just looking at the number of trials for companies working in the opioid space, then I think we're probably the last firm out which have not been subject to subpoena in this space. Looking into the data we have submitted, we have no reason to or concern.
At the same time, there is of course some kind of reason why they issued the subpoena, which we so far have no insight into. That one has not moved either since basically July 2014 or 14th of July when we received the subpoena. Our financial outlook, we've just done some small adjustments on the financial outlook. The key market development where we expected a double-digit growth when we started, we're now downgrading that to 5%-8% growth, also in Q4. We can basically as we are already nearly halfway through, I think that's a pretty good estimate, probably in the higher range of this, but that's where the market is headed. Zubsolv sales, we expect Q4 to be in line with Q3.
As you saw, there were some one-time positive effects on Zubsolv for Q3, but we believe that we can compensate for that through other build-ups during the quarter. When it comes to OpEx, we do expect that, again, the OpEx to be in line. We expect to see a more focused investment in both Zubsolv and in DTx during the quarter. But we have the pivotal trial, for example, for OX124, which is now getting finalized and that will come in as a cost on overall group OpEx. Finally, revise that a little upwards. Before it was 50%, now we expect it to exceed 50%. As you can see in the numbers and Joe's presentation, we are in good shape there.
Finally, on page 34, our strong value drivers in the future as you hear and saw on Dennis numbers are this. The issue with mental health and overdose and substance abuse is something that unfortunately has accelerated during the COVID-19 crisis. I was reminded of that just this morning when I drove to work. That was actually on the radio where people were talking about how many more people who are suffering now from depression. It's really something that is a major issue. We have an established infrastructure in the U.S. which will help us a lot, in particular when it comes to MODIA. As Dennis said, I don't think there's any field force or sales organizations out there who have a better relationship broadly within the opioid-dependent space as we have.
We have a pharma pipeline, which includes OX124, and I would say equally exciting, the technology and inventions behind OX124, the way that we can apply that to new spaces with significant unmet need is going to be very exciting to follow. We do that from a position of strong cash position, where we feel that we have the cash that's needed to invest into the establishment of DTx onto profitability and also into advancing our pipeline. There will be periods where we will invest more in clinical trials, but on the basis we have, right now an economy which is quite balanced in the sense that we have recurring income and costs are in balance. We have a completely new frontier.
It's not a sprint, this is a marathon for us to develop the digital therapy market. Just looking at how it's advancing, and particularly now we can see when COVID-19 restrictions are easing, our access to customers is improving significantly. We simply see that every meeting we have face-to-face has much better traction than what we could accomplish over Teams meeting. I think that's a very important trigger for us to get more momentum in our digital therapy business. With that, I will open up for some questions and answers. Thank you for your patience and attention to our presentation. Thank you.
Thank you. If you do wish to ask a question, please press zero-one on your telephone keypad. If you wish to withdraw your question, you may do so by pressing zero-two to cancel. There will be a brief pause until questions are being registered. Our first question comes from Gergana Almquist with Redeye. Please go ahead.
Hello, everyone. I have mainly questions for Dennis. The first one is on deprexis. Could you elaborate a little bit more about the marketing strategy for this therapy?
Absolutely. For deprexis, we lead from a messaging point of view underlying the significant evidence base. What's important is in that range of clinical trials that I mentioned, there are a number of highly applicable use cases, where deprexis either a standalone or as guided therapy has demonstrated benefit. Initially, we had a focus to educate consumers directly about deprexis, about depression and new options. As we move to this path with partnering more closely with systems, we'll be more closely working with providers, to position deprexis as a complement. In depression, it's a very crowded market in terms of the number and range of available therapies, including both digital health and digital therapeutics.
In particular, we've seen some of the providers, particularly counselors, are a bit more skeptical because they see some of these products as possibly competitive. We are taking the time to work with the providers to emphasize that we're here to help complement their practice and then outline with them where it can be best used, where it best fits in their toolbox, if you will, in terms of delivering care and addressing some of the barriers that they have. That'll be the focus with deprexis. It'll move to an even more provider and system focus as we go forward, and similarly, doing those demonstrations in market as I talked about.
If I can just compliment Dennis here, I would also just highlight that again, that it is—if you sit as a consumer, there are endless number of apps on App Store and similar, which are giving quite a similar promise of digital therapy with the cognitive behavioral therapy, where very few of them, really none, have any clinical evidence of effect. But they do come in. I would say a lot of them are like a PowerPoint presentation with a voice-over. From the surface, they come out as much cheaper than deprexis. Of course, based on all of the investments that's made in deprexis and our focus on payers, that's both large healthcare providers and insurance companies, we have priced deprexis in a B2B pricing more than a B2C pricing.
The list price of deprexis is $399. We right now have some campaigns that could bring down the price. If you look at App Store, several of these other tools maybe cost you $10 per month. We have priced it based on where we see the value and based on all the clinical evidence that's behind deprexis, where some of the competitors who are more focused on direct to consumers have a lower price. I would say that we do know that FDA is quite concerned about some of these unvalidated claims that a lot of these PDT providers give right now. I guess this market will get more regulated in the future, which would benefit us because we have probably the strongest evidence base of any in depression.
Thank you. The next question is on MODIA. You mentioned that there will be synergies with Zubsolv, which will open new market niche. Which niches are those?
Dennis?
With MODIA, the great thing about MODIA is it's been developed the standard of care as where MAT is being delivered. For medication-assisted treatment, that means all buprenorphine naloxone products, of course, Zubsolv, but all the others that are available. It can also be used in MAT, for example, in methadone clinics or even with Vivitrol.
Some of those other approaches, where we may not be there directly for Zubsolv at the moment because those are not open channels for us, MODIA, you know, offers an opportunity to expand, but still maintain that focus on medication-assisted treatment and how MODIA can uniquely help support the assisted treatment, the counseling aspect.
Thank you. My last question is on the European distribution of Zubsolv. Do you have any updates on that?
Yeah. As we have announced before, we have a packaging site in Romania that have been faced with some regulatory challenges because they need to have a license to handle buprenorphine. Due to COVID-19, the audit that was planned already in March 2021 happened now during the late spring of 2021. Then it took time for the documents are there. Right now everything seems to be moving quite well according to plan. We are now expecting to see the launch during Q1 of next year. It has taken time. I will also highlight that the packaging of Zubsolv for Europe is more complex because we need to package relatively small volumes with different languages.
Whereas in the U.S. you have one package, one line that could go through to the entire market. In Europe, you basically need to have much smaller batches and be able to manage the different languages, that is for each country. That limits the number of possible suppliers who could do it at a reasonable price. You would probably also recall that when we got the product back from Mundipharma, we saw that their cost of goods was simply too high to be competitive in the European market. That was driven a lot by packaging. The Romanian packaging side is unfortunately where we are right now. I think they are a good partner but have been facing some regulatory challenges that were unexpected.
Okay. Thank you very much.
Thank you.
As a reminder, if you do want to ask a question, please press zero one on your telephone keypad. Our next question comes from Samir Devani with RX Securities. Please go ahead.
Hi, everyone. Thanks for taking my questions. I've got three. I guess just sticking on the DTx theme for a moment. Our discussion with payers seemed to highlight that 510(k) is sort of a critical requirement. I'm just wondering, it's obviously encouraging that you're talking about MODIA applying for 510(k). I'm just wondering in your discussions on vorvida and deprexis®, has that not pushed you to think about getting 510(k) for those products? That's the first question. Perhaps you wanna deal with that, and then I'll come back with DTx for Joseph. Thanks.
Dennis.
Yep, sure. Thanks, Samir. Yes, for the PDT route, 510(k) is at this point essentially mandatory to be classified as a prescription digital therapeutic. With vorvida® and deprexis®, as these are seen as more digitized counseling, they better align to the medical benefit side of the house as a medical service. More of our focus has been with identifying the proper medical billing pathways that exist for counseling and confirming that they can be covered under those pathways. We've seen that's not been us pushing that direction. That's in deep discussions with different payers, the strategy that they're taking as they try to divide, you know, prescription versus medical services.
Right now we think that both Vivitrol and deprexis® have a proper regulatory position that can be supported with a different reimbursement approach than the PDT route.
Okay. Thanks very much for that. Just a couple of questions for Joseph. I know that there's quite a significant provision taken in the quarter. Could you just talk a little bit about that? Just on the net financial items, there was, you know, a positive gain of SEK 13.5 million in the quarter. You had a SEK 2.8 million bond charge, but what was the rest that got you to a negative SEK 0.1 million net financials? Thanks very much.
Well, on that question, the exchange rate, we have most of our cash in U.S. dollars, so the stronger dollar during the quarter resulted in the gain. I'm sorry, your first question on the provision? Okay.
Sorry. Just before you go, continue. I understand you had a SEK 13.5 million FX gain in the P&L, but you put net financials at -SEK 0.1 million. What was the negative component of that that offset the FX gain?
The negative component relates to, obviously, interest expense on our bond.
Right. Which is SEK 2.8 million.
Right. Also, because we have a loss, there's some impact right there as well.
Okay. Maybe we can handle that offline, Joseph, but that doesn't seem to add up to me.
Okay. Let me. I'll get that for you.
We can pick that up offline. Perhaps you could just talk a little bit about the provisions.
I'm sorry. When you say provisions, what provisions are you speaking of?
I think there's a SEK 32 million charge on the cash flow for a change in provisions in the quarter.
On the cash flow, so we
Yes. The change in provisions SEK -34.4.
Okay, the change in provisions. We have investments which we mentioned on the slide we talked about, but we also have movement in our working capital as well. We also have investments in DTX that we're amortizing, starting to amortize some of those as well.
Okay. Thanks very much.
We have no further questions. I hand back to our two speakers.
Okay. Thank you, thank you so much. I have received some questions over the Internet, so I will try to address some of them. We've talked about the DTX and our rollout, how we proceed for the next one to three years. I think we're making very good progress with some of the partnerships, but then as also the question here is around reimbursement and how would that proceed. I think when we look at some of the work that Trinity Health have actually taken the lead on is to work with this medical benefit route and to get that validated with their payers, which of course is taking some time. I'm quite pleased to see that we are there right now.
Now we just need to get the final FMS two processes moving, and I think that will serve as a very good benchmark and learning for other payers who like to follow the same. There is a question, where do we have the reported revenues from? And admittedly, the reported revenues are all from direct to consumer sales. It is basically patients who have been on our homepage and bought it, using their credit card, either on a monthly installment or on a one-time payment. We haven't seen any institutional sales right now, and that's basically because we have to establish these reimbursement pathways and find ways to set it up also within these larger organizations. There is a question around the plan for MODIA in Europe.
Now when we are finalizing in the U.S., we have started a process in Europe where we are actually planning to talk, or we already set up meetings with different European organizations who could work with us in Europe to roll it out. We are starting to assess what are the right regulatory pathways, how the reimbursement landscape looking, which is right now very, very fragmented in Europe. There's a question about Zubsolv EU. I think I have addressed those already. Then there are some questions around legal and where we are with both the subpoena and the fund Opiate Education. I also believe I have addressed those questions in the presentation.
With that, I would thank all of you for your time and asking, and hope that all of you will have a great day. I hope you get the impression that we feel that we are on a very strong pathway with Zubsolv, where we are now starting to see that we have started to very stabilize sales both from the ones that drove us negative the last two years, UnitedHealth Group and Humana. We actually this quarter had a quite good development on the sales of Zubsolv. When it comes to DTx, there's a lot of stuff moving. It's something that some of it will take time, but I think we are really on the right pathway. We're also in the right business.
This is something that I'm a strong believer together with many others, that this will become a very important element of healthcare in the future. Finally, on our pipeline, I think there's a lot of exciting stuff coming both with the OX124, but also on other technical opportunities or product opportunities coming out of that platform in the future. I hope you will stay tuned and focus and follow us and also in the next quarter, because I think there's a lot of exciting opportunities.
Thank you so much.