Welcome to our webcast in relation to our quarterly report for the third quarter of 2025. My name is Martin. I'm the CEO of Xbrane Biopharma, and I have with me today also our CFO, Jane. We will, as we usually do, start to go through the operational highlights of the quarter, and then Jane will go through the financial highlights, and then we will have some minutes for Q&A towards the end. You can ask questions either via the audio function if you've called in or via the chat. We will star``t with Ximluci, our Lucentis biosimilar, which we have partnered up with STADA , currently launched in 24 countries, out of which 20 in Europe and 4 in Asia/Middle East. It's quite a straightforward collaboration where we are essentially sharing the profit contribution 50/50 from the sales and marketing of this product.
Just to have a look at the market situation to start with, this is a biosimilar to Lucentis, an active ingredient, ranibizumab, and we have beyond Ximluci three other biosimilars to Lucentis on the market. You can see that there's a dark blue part on the bottom. That's Lucentis, the originator, as well as the Lucentis biosimilars on the market. If we consider the broader class of drugs, retinal anti-VEGFs, we also have the originator product Eylea, as well as Vabysmo, and then we have a certain off-label usage of the cancer drug Avastin. All in all, this is a market of about EUR 5 billion across Europe, and it has been growing with some 7% per year in volume and 5.5% in value. We're seeing quite a lot of developments in this market.
It's a sizable market and it is growing, but it is also so that Vabysmo, the new product launched by Roche, is taking market share in the overall market. In the Eylea space, we're going to see biosimilars coming into the market starting from the end of this year and onwards. If we look at Ximluci and the performance of Ximluci, we had more or less a constant volume Q3 versus Q2, and that is volume that STADA sold to end customers. Market share from a volume perspective was also retained at about 8%. That is the market share within the ranibizumab market, so versus Lucentis and the Lucentis biosimilars. Ximluci is the market leader amongst the biosimilars in Italy and Germany, and we are having quite interesting dialogues with our partner STADA right now. I think there are good opportunities for continued growth during next year.
There are a couple of exciting tenders where STADA is going to participate. We do believe that the growth is going to be resumed during next year. We also resumed the shipments of product to STADA this quarter, and that will continue in the coming quarters, coming five, six quarters as far as we have had that forecast, if you will. Total profit generation accumulated so far about SEK 115 million, and we also do have an inventory of drug substance mainly when it comes to Ximluci of about SEK 170 million, which now, as shipments to STADA are being resumed, is being converted into cash continuously. Switching over to the U.S., as most of you probably know, we unfortunately faced a delay with regards to FDA approval.
We received a so-called Complete Response Letter to our application from the FDA, and that was quite generic in terms of stated reasons for not being able to approve the application. It mentioned that it was due to unresolved observations at one of the manufacturing sites. What then happens is that the site, which is a contract manufacturer, we don't have our own manufacturing site, so this is a contract manufacturer. Therefore, also, FDA is conscious about keeping confidentiality, not revealing information to us that is not permitted by the contract manufacturer to reveal to us. The site will receive more information soon. They haven't received it yet. Last time, we saw such information coming five days post-CRL, so we do expect that information to come these days, essentially.
There, it will be more information from the FDA, what specific observations from the inspection they did at the end of August that they felt were unresolved by the responses the production site submitted. We really need that information in order to be able to put down the foot with regards to timing of resubmission of the BLA. We do believe, though, that we are looking towards a resubmission first quarter of next year. That is based on, essentially, the corrective actions which are ongoing at the production site following a few of the observations from the recent inspection by FDA are going to be finalized in the beginning of next year. We do believe that that is going to be able to trigger a resubmission. We really need this information from FDA to be able to confirm that timeline.
It is then a six-month review timeline expected from a resubmission until the BsUFA date, and hopefully, this time around, an approval. We understand, of course, that many of you are disappointed about this, and we are, as well, very disappointed about this outcome. It is absolutely not what we expected or had hoped for. We really now have to wait for further information from the FDA, fully understand the issues they see, and then work together with our contract manufacturer for swiftly resolving these issues and go towards a resubmission. Switching gear to our Xdivane program, biosimilar candidate to Opdivo. Still, as far as we can tell, this is one out of four biosimilars to Opdivo currently in clinic. We do believe we have a timeline which is going to permit a launch in the U.S. on day one, so to say, so immediately post-patent expiration.
That is December 2028. We can note here, we can go to the next slide, that the clinical trial is initiated by our partner Intas . We are, on our end, going through our development responsibilities of doing the process characterization and validation, which is a key element, of course, of an application. I think if there's one big lesson to draw from our issues with regards to Ximluci and the FDA, it is that you should really make sure to work with manufacturing sites and contract manufacturers with a long history of successful FDA inspections and a long-time supply of product to the U.S. market. We made sure to do that for this program. We're working with one of the largest contract manufacturers globally and sites with a long history of successful FDA inspections and currently supplying product to the U.S. market.
We're making all we can together with our partner Intas to carry this development through so that we can make a submission to the FDA fourth quarter of 2027 to allow for an approval end of 2028 by the time of loss of exclusivity by the originator. This is a very sizable opportunity for us, we do believe. We do believe it could generate SEK 1 billion annually to Xbrane based on how historical oncology biosimilars have performed in the U.S. and based on the profit split we have agreed with our partner. A very sizable opportunity for us. It hinges a lot upon a timely approval first in the U.S. That's what we're fully focused on. I do believe that we have a timeline and a setup now which allows for that. Quite excited about this program, actually.
With that said, I'm going to hand over to Jane to go through the financials.
Yes. The revenue for the quarter was picked up again with shipping to STADA , and the total revenue of shipped products amounted to SEK 10.7 million, and the received profit sharing amounted to SEK 9 million. However, there was an adjustment made to expected profit sharing with SEK - 10 million, which made the total net revenue amount to SEK 10 million for the total quarter. We expect to pick up more shipments during the coming quarters, and some of the shipments have been delayed in the third quarter, which is the reason also that the revenue from the shipment was a little bit lower than expected. We have some ongoing reductions on measurements to reduce our production costs together with our partner STADA , and those will be materialized during the coming years.
The expenses of the new Xbrane, so to speak, have been reduced as we had anticipated. The administration expenses amounted to SEK 8 million for the third quarter, and the research and development expenses amounted to SEK 10 million, whereof SEK 2.8 million are referring to amortization of our intangible assets. All in all, we have the fixed cost amounting to approximately SEK 11 million on a quarterly basis. We also wanted to visualize the cash position as of the end of the third quarter. We concluded a directed share issue in July, which provided SEK 240 million prior to transaction cost of SEK 19 million. We also repaid the short-term loan of SEK 22 million, as well as our accumulated accounts payables that had been built up during the end of 2024 and the beginning of 2025. The amount of that accumulated accounts payables was SEK 91 million.
We had some production costs related to the FDA inspections as well, amounting to SEK 4 million, and also the profit sharing, as I mentioned, amounting to SEK 9 million+ . The fixed cost amounts to SEK 11 million and consists, all in all, of salaries, consultant costs, IT, basically everything that keeps the show going, so to speak. The development costs of our current program amounted to SEK 27 million, and we have some other cash flow items of non-recurring kind amounting to SEK 5 million, which gave us a closing cash balance of SEK 94 million. Basically, the operating cash flow amounted to SEK 49 million, and the cash at the end of the period amounted to SEK 94 million.
Yeah. The key takeaways from the quarter, Ximluci currently being present in 24 countries, constant volume growth versus Q2, but we do see opportunities which we are working together with STADA on for growth to resume coming into next year. Delay in the FDA approval of Ximluci, as we discussed, with a potential resubmission first quarter of next year and then a new BsUFA date Q3 next year. Xdivane ongoing clinical trial and development on track towards a day one launch and the directed share issue that we conducted, as Jane described. What we now are focused on, of course, is to work with our contract manufacturer on Ximluci and with the FDA to get towards a resubmission and eventually an approval of Ximluci in the U.S. Work together with STADA for continued penetration of the European market when it comes to Ximluci.
We are also working on several production cost reduction measures together with STADA so that we, over the coming years, are going to be able to bring down production cost. Our development responsibility in relation to Xdivane consists of process characterization and validation. These are our priorities for the remainder of this year and next. With that said, we can shift over to Q&A, and I guess we start with the potential questions from listeners calling in.
If you wish to ask a question, please dial pound key five on your telephone keypad to enter the queue. If you wish to withdraw your question, please dial pound key six on your telephone keypad. The next question comes from Filip Einarsson from Redeye. Please go ahead.
Hello, everyone. I just wanted to start on Ximluci volume growth. As you mentioned, there was no volume growth from Q2. Could you just expand a bit on this trend, on the decline?
Yeah. It was constant volume Q3 versus Q2. Yeah. Essentially, I think this depends on, on the one hand, competition from in the general market, the originator, and the other biosimilars. We do see an increased price pressure, if you will, in that market. That's one part of it. There's an element which goes to active work by STADA to participate in new tenders to be able to unlock new volume, something which takes time. According to the forecast we have together with them, we are looking towards 2026 with, yeah, a quite significant growth compared to 2025. I would read it as a temporary decline in the growth, if you will.
Good. On the profit split, can you again clarify what it was in Q3 and also the SEK 10 million adjustment just to make it a bit clearer?
Yeah. This goes back a little bit, probably to how we do revenue recognition. We shipped the product to STADA, and for that shipment, we expected SEK 10 million profit sharing. There was SEK 10 million also for kind of supply price, which is according to COGS. We also needed to do an adjustment of expected profit sharing to come from product already shipped to STADA. That resulted in a SEK -10 million. Am I describing that correctly, Jane?
Yes, that is correct.
Okay. Good. Also, just a clarification. As I understood it, there's been no news from the FDA. Has there been any new dialogue with the contract manufacturer that you could shed some light on?
We are keeping a continuous dialogue with the contract manufacturing site. However, they have not received any further information from the FDA. We do expect that to come these days, essentially. Last time, we had a five-day time period between a Complete Response Letter and the so-called PAR letter that is coming into the site following a Complete Response Letter.
Okay, next week then is a good guess?
Yes.
Okay. Trying to understand the cost base a little bit, would you say that Q3 is sort of a good picture of the fixed cost base moving forward?
I would say that it's quite representative in terms of the fixed cost. Yes, I would. However, one must also remember that we have the maintaining obligations in terms of the development. The cash outflow is not just consistent with the fixed cost, but also with the development obligations that we are currently working on.
Okay. Also, one last, if I may. Previously, we have been talking a lot about the pre-filled syringe, and it was viewed as a key element to increase market adoption. Can we just get an update on the current status? I mean, we haven't spoken a lot about it lately.
Yes. We still have it in development, but we need to clarify now if we need to revise the timeline somehow. We need to discuss that and get back with our partner STADA. It's going to be dependent on the remaining investments when we together are willing to take those. We need to get back on an expected timing of submission, approval, and launch of the pre-filled syringe.
Okay, that was all for me. Thanks.
As a reminder, if you wish to ask a question, please dial pound key five on your telephone keypad. There are no more questions at this time. I hand the conference back to the speakers for any closing comments.
Okay. We have some questions here in the chat. Let us try to work those through. First one, are shipments to STADA being resumed in Q4 2025? Yes, we made a shipment, although a limited one in Q3, and the shipments are going to be resumed in Q4 and throughout 2026 as well. Next question. Can you please clarify how much of the capitalized development cost as of Q3 relates specifically to the Xdivane project and what the remaining expected expenditure is to complete the ongoing collaboration with Intas ? Are you able to answer the first part of that, Jane, or?
Yeah. I think for the third quarter, about SEK 65 million were capitalized in relation to the Xdivane program.
Yeah. With regards to future expected expenditures to the program, as we've been discussing before, we estimate that to amount to about SEK 200 million net of commercial material coming out of that process. Our intention of financing that is via the inventory of Ximluci, which now gradually is being converted into cash as we resume product deliveries to STADA. Next question. Can you elaborate on main drivers behind negative operating cash flow in Q3, given that reported costs were around SEK 26 million- 27 million, but total cash outflow exceeded SEK 49 million? Is this something we will see in the coming quarters? Do you want to take this one, Jane?
I would say that the reported costs are not really SEK 26 million, SEK 27 million. The bridge that I have tried to visualize of the outflow is not categorized in terms of costs and what is capitalized. However, I think that we will see less and less of negative cash outflow, provided that we have now reached a status where the outflow of the operating expenses is more or less equal to the incoming revenue on a quarterly basis. I don't think that we will see more of that in the coming quarters. That is my expectation.
Can you explain why the shipments were delayed in Q3? I think this was due to some delay in one of the manufacturing steps, if you will, so that one or two batches, which we thought would be shipped in Q3, instead are going to be shipped in Q4. Next one. Given the current burn rate and the additional SEK 60 million loan facility, how long is the company operational runway under current assumption? As per our current cash flow forecast, which then, of course, contains the expected product shipments to STADA, our forecasted expected profit sharing from Ximluci and so on, it tells us that we're going to be able to sustain throughout 2026 with the current cash position and in addition to this loan facility. Next question.
What measures are being taken to stabilize cash flow going forward, for example, through improved payment terms with STADA, milestone payments from Intas, or cost control initiatives? I would be saying all of those, essentially. We are working on different angles, as we've done in the past with STADA. We are working with Intas and our suppliers as well with regards to different kinds of solutions to improve cash flow. It's mainly, I would say, going forward, important questions about timing of different in-and-out flows, which we need to balance out. Cost control initiatives, I think we've done what we could now with regards to our organization. Post the transaction we did with Alvotech, we're down to a fixed cost base, as we discussed, of about SEK 10 million a quarter, which is what we expected.
We are shifting out some consultants, but it's not that material in the whole context. I think we've done what we could there. It's more about balancing out development expenditures on different kinds of service providers, and particularly then in relation to the Xdivane program with inflow coming in then, as I discussed before, expected from Ximluci, not only the profit sharing, but also as the inventory we built up is being converted into cash. Next question. How about milestone from Intas? We received a milestone from Intas of about EUR 2 million last quarter. As per the agreement, it is a remaining EUR 1 million milestone to come. Then it's continued upon profit sharing to come post launch of the product. Goal of 20% market share in Europe changed. No, that remains. I think we have all possibilities with Ximluci and together with STADA to get towards 20% volume market share.
That ambition remains. Why is the pre-filled syringe taking so long? I think currently, we're making some trade-offs, mainly from a kind of cash flow perspective with regards to when we're making certain investments. I think that's why we're now delaying the timeline a little bit on the pre-filled syringe. Next question. Will you buy OTC to increase shares? Will you buy OTC to increase shares? Are you getting that question, Jane? I'm not getting that question.
No.
Okay. We'll leave that one. Anyway, those were the questions we received on the chat, and we are then going to conclude the call again. I do fully understand that many of you out there are disappointed about this news coming in from FDA. We are equally disappointed over here. However, it's not much more to do than to get back at it and work together with the agency and the contract manufacturer, in this case, to resolve the issues and submit the application again. We hope that we are going to be able to provide some more clarity around those timelines in the coming weeks. With that said, we thank you all for calling in and participating and wish you a good day.