Thank you for standing by. Welcome to the Xbrane Biopharma Q1 2022 report conference call. At this time, all participants are in a listen-only mode. If you wish to ask a question via the webcast, please use the Q&A box available on the webcast link at any time during the conference. Please be advised that this conference is being recorded today, the fifth of May 2022. If you require any further assistance, please press star zero. I would now like to hand the conference over to your speaker today, Martin Åmark. Please go ahead.
Thank you very much. Welcome everybody to this call where we're going to present the Q1 report of Xbrane Biopharma. Start to apologize a little bit for my voice today. Maybe sounds like I had a heavy night yesterday, but that's not the case. It's a pollen allergic reaction. Apologies for that. We'll try to do the best out of this call anyway. Can just start here with reminder on our portfolio biosimilar candidates we're working on. We have Ximluci, our Lucentis biosimilar candidate, which is currently in registration phase. We submitted the file to EMA in September last year and to FDA in March this year.
We're currently going through the regulatory processes to try to get towards an approval in Europe during the latter part of this year and then in U.S., most likely Q1 next year. We have Xcimzane, our biosimilar candidate which we partner up with Biogen earlier this year. We're happy with that arrangement and having Biogen as a partner. We're currently going through tech transfer and preparation really for scale up together with drug substance contract manufacturer AGC. We have our oncology portfolio, which is more early stage. More early pre-clinical development of biosimilar candidates, Opdivo and Darzalex respectively. This portfolio together addresses roughly EUR 32 billion of reference product sales if we look at 2021.
This is a slide that we presented early this year when we went through the Q4 report. It's kind of the focus for this year on our different programs. We can just walk this through and talk a little bit about what we have achieved during the first quarter and what we intend to do during the remainder of the year. We start with Xlucane then as I said, the BLA or the marketing authorization application to FDA was submitted in March. We're currently waiting for acceptance by the agency of the application, and we will communicate when and if that happens, most likely during the course of this month, during May. The formal process starts.
We will also be able to communicate then the date when the agency is targeting to make a decision with regards to the application. That's most likely going to be in March next year. With regards to Europe, we are going through the regulatory process as we speak. We received questions as per the process on day 120. That was January. These questions were responded to EMA in April. We are expecting according to the process questions on day 180, which is then in June. If all goes well, we're able to answer these questions. I think that we're looking forward towards an opinion by CHMP, the committee in September, followed by, if that is positive, of course, an approval by the commission towards November.
That's roughly speaking the timeline. We are then of course working very closely with our contract manufacturers and preparing for producing large volume for Ximluci. That is really going to start you know late summer post patent expiry of the main patent of the originator in Europe. It's a lot of preparatory work ongoing of course to make sure that the supply chain is fully prepared. Then there are preparations ongoing of course by STADA and Bausch + Lomb for a launch dependent on approval of course. I think overall Ximluci is moving along according to plan.
We're very excited, of course to go through this very important year for this product and looking forward toward finally being able to see the product on the market. Xcimzane, as I said, we're happy with having been able to conclude the deal with Biogen, and now it's really about we kind of set the production process pilot scale, but we're working with tech transfer to an agency and preparing for scale up really for the process. Of course, more intense preparation for clinical trials are going to be done during the year and hopefully being able to initiate trials during next year.
As you recall, under the terms of the deal with Biogen, initiating and conducting the clinical trials is really Biogen's responsibility. On the oncology programs, Xdivane, our Opdivo biosimilar candidate, we have concluded cell line development, and we are developing the process at pilot scale, which we do here internally in our lab here in Solna. That's going to be concluded during this year, after which we can start the process as we're going through now with Xcimzane to tech transfer and scale up at a selected contract manufacturer. It's also work to be done during the year, of course, to select a suitable contract manufacturer for this product candidate.
Our Keytruda and Darzalex biosimilar candidates we introduced late last year, and they're really in early stage. Cell line development stage currently, and we're going to initiate process development during the course of this year, but we're really not there yet. I guess that's a brief update on you know what we're trying to accomplish across our portfolio during the year and what we've done so far. We continue to grow from a staff perspective or team perspective. We're now 64 team members. And we're happy to see that still it's rather easy for us to attract talent to the company. We see a lot of talent coming becoming available in the market due to reductions at other companies.
Also we see that there's great interest in actually coming to Xbrane to work due to an increasingly good reputation in the market, which we're happy about, of course. With regards to upcoming capital markets events, we're going to participate at ABG Life Science Summit in May and then Pareto Capital Markets Day in September. We intend to hold our own capital markets day in Q4 this year. I mean, as you remember, we held a capital markets day in May last year, but we really wanted to await, you know, hopefully approval of Ximluci, to be able to hold this capital markets day and then being able to focus more on the launch efforts of Ximluci. We wanted to hold that capital markets day in Q4 and focus it on that.
We'll get back on more details, around that, internal event. With that said, I hand over to Anette.
Thank you very much, Martin. This is Annette Lindqvist speaking. I'm the CFO of Xbrane. I will take you through a couple of short updates on the financials before we move to the Q&A session. First of all, the total company expenses, we actually saw a decrease of approximately 20% during the first quarter in 2022. This is true and not true because those of you who have been with us for a while, you would remember that in June or from July last year, we capitalized our development cost for Xlucane on the balance sheet. This is obviously the net of cost. That explains kind of the overall decrease.
I should also point out that the G&A cost stays on a nice and fairly low level in comparison with the previous quarters. We then look at the next slide, which is a like-for-like and year-on-year comparison. We see that the total operating costs have actually increased with 38%, which is obviously very natural as we move into the next stage with Ximluci. The efforts with Xcimzane are the activities there are increasing. We also do some exploratory work for the new immuno-oncology portfolio. What you see here that what's on the balance sheet in terms of Ximluci is the red bar. In the Q1 we capitalized close to SEK 30 million. Lastly, some cash update.
We leave the quarter with a strong cash position of around SEK 300 million. Of course, that has been supported by the first upfront payment from Biogen that was received in March. We leave the quarter with a strong position, and also the shareholder equity is close to SEK 400 million. With that, I think that concludes the financial section. We move to Q&A. Over to you, Martin.
Okay. I am looking at the questions coming in here from the audience, but actually this seems to have been crystal clear because there are no questions as far as I can tell. Maybe we should wait a-
We should maybe-
Couple of seconds. In case anyone has a question, please enter it into the chat.
Yeah.
Okay, now there's one question. Can you please comment on the cash runway? Okay, yeah. It's a good question. I think we came out of the quarter with 300 million SEK in cash position. That will take us at least to approval of Ximluci. That's really what we're targeting as the next milestones. That's probably what we can say. Looking beyond that, it's going to be very much driven on the oncology portfolio and what we manage to do there from an out-licensing perspective before we go into scale up with a CMO of the first product candidate being our GLP-1 biosimilar. That's probably what we can say on that question now. Oh, no, there are a couple of other additional questions.
No, okay.
Okay, good.
We'll put the other there.
Next question. What are the sales of Ximluci in Europe, and can you please remind me of the economics of the deals you have around this biosimilar? The sales of Lucentis, the originator, is about EUR 3.2 billion globally. If you add Eylea to that, you're getting close to EUR 11.7 billion of total addressable market, so to say. The terms we have with regards to the deals with Stada and Boehringer Ingelheim are the following. With Stada, we are going to share profits generated from sales 50/50. That is really after subtracting production costs and sales and marketing costs on Stada's end from net sales. After that, we share the profit generated 50/50. With Boehringer Ingelheim, it is a profit share split agreed upon.
Boehringer Ingelheim is going to share a certain percentage of the gross profits with Stada and Xbrane. The exact percentage we haven't gone out with yet, but that's the mechanism. What we expect, this, I guess, is based on the overall, you know, forecast and expectations from our two partners, is that we shall be able to generate EUR 100 million of, you know, profit sharing to Xbrane third year post-launch. That's our. That is based on, you know, roughly speaking that on average that Ximluci captures a 25% volume share across the main territories, Europe and the US, at the price discount versus originator current pricing that could go up to 50% at year three.
That's kind of the fundamental assumptions getting to those EUR 100 million. Okay, next question. The board proposed authorization potential share issues. How do you view the current cash position regarding Ximluci potentially launching in H2 or second half of this year? Yeah, no, as I said, the current cash we have will take us to market approval of Ximluci. Post that, it's really going to be TBD-dependent what we do and how, that is to say, alone or with a partner around the oncology portfolio.
If I just may chip in, there's also a third moving target, and that's the achievement of the milestones for Xdivane in the Biogen agreement as well. Pending how that work is going and the achievement of those milestones will also be the third component, which is then obviously also a moving target.
Yeah. Along with the expected milestones of Ximluci with Boehringer Ingelheim.
Yeah.
Arrangement on FDA approval and launch in the U.S., which are then expected to come during 2023. Okay, next question. Can you shed some more light on BLA submissions since the end of March? Has there been any contact with FDA? Okay. The file was submitted end of March. We've had just one or two clarifying questions from the agency so far. We're really waiting now for the agency to accept the submitted file and start the process, and that could take anything from 30 to 60 days from submission. We really expect that to happen during the month of May. Okay, next question. Do you plan to start selling Ximluci in Europe right after marketing authorization has been granted? The answer to that is in some countries that is possible.
In others, you have to wait on approval for pricing and reimbursement. I think, for different countries, it could be immediately, up until six months post-marketing authorization. Could you tell about additional questions from EMA? Do you see answers will be accepted, not causing delays in the approval process? Well, this one is a little bit harder to comment on. We received close to 150 questions from the agency. I think we provided to our assessment good answers to all of them. But I cannot really comment more than that, I think, on this question. Next one. How does it look for new partners for Ximluci in Japan, China, Latin America? Yeah, that is a good question. We are working on this together with startups.
As you probably recall, Stada really has the commercialization rights globally ex-China. It's really Stada's responsibility to fill up the gaps, so to say, in relation to what they can do with their infrastructure. They're actively working to try to find partners in at least Latin America and select countries across Asia. We hope really that we're going to be able to update on this during the course of the year. Are you planning to seek an interchangeability designation for Exkadin in the U.S.? The answer to this is no. To our assessment, this was not really possible as per the guidance of interchangeability designation by the FDA.
Because what is required are really a switching study looking at comparative pharmacokinetics, which is something you cannot really do with a drug injected into the eye and with a very low systemic exposure and high variability in the pharmacokinetic pattern. It was not really possible to do as per the guidance. It is not done by any of the expected to be competing biosimilars either. I don't believe it would matter so much in this setting either, since it's not a product going primarily via the retail channel where the concept of interchangeability would be most important. Next question. Can you elaborate on your view on the future business development of oncology biosimilars, please? Okay. Well, we are initiating dialogues with potential commercialization partners already now.
We haven't put out a target. The ambition is clearly to try to do a deal with a suitable commercialization partner before we go to the clinic. I mean, that's our business model and what we're going to try to achieve. We haven't put a target to the external market when we plan to see that happen. We are already now, even though we are in an early stage of development as you've seen, we're starting to engage in dialogues with potentially suitable commercialization partners.
Mm-hmm.
Good. Okay. I think that was the last question. I'm glad that there finally came a couple of questions, good questions. Thanks a lot for that.
Mm-hmm.
We're always available should you have any follow-up questions. You can reach us via email or on the phone. With that said, I think we can conclude this call and thank you all for participating and listening.