Welcome to today's Q2 interview from Inhalation Sciences, where I'm joined by the company's CEO, Manoush Masarrat, and the recently appointed Chief Commercial Officer, Ulf Wedenberg. Manoush, to start things off, the Q2 report was published on Friday. Can you summarize some of the highlights of this report, please?
Absolutely. Thank you. Our Q2 report included FDA's approval to publish the high-level data from our joint DissolvIt study, which we made through a webinar on May 28th, which is also available on our website. The announced rights issue, which was finalized during the Q2, as well as the changes in the company's board of directors and the management team, where we now have a new Chief Commercial Officer, Ulf Wedenberg, who is with us today. In terms of sales and revenue, there is still very high interest in our platform technology and in our inhalation research services, IRS. We have several ongoing dialogues with potential customers, resulting in a steady pipe of around SEK 30 million. We are also working closely with the market and our planned communication campaign.
The DissolvIt study is supported by FDA, as well as the new FDA guidelines to include dissolution testing for inhalation studies are some of the elements that should support turning this to our favor.
I now turn to Ulf. As new Chief Commercial Officer, can you make a short intro of yourself and then maybe give your view on ISAB and the potential in the market from your end?
Certainly. Thank you. Thank you very much. I have a background in sales and marketing across the pharma and med tech industries. I've always been passionate about representing companies with a strong capability and a meaningful innovation. That's what I saw in Inhalation Sciences, a very experienced and competent team, and a technology that truly make a difference. I'm excited to join the company and look forward to contributing to success going forward. About Inhalation Sciences, we offer services in the preclinical phase of inhaled drug development, whether it's for a new chemical entity, a generic, or a biologic drug. So does our competitors. However, all of them use conventional methods established long before our technology was available.
Our cutting-edge PreciseInhale system is setting a new standard in preclinical inhalation research by delivering an unmatched precision in aerosol dosing, which results in high-quality pharmacokinetic data with correlation to in-human results. This enables unprecedented clinical predictability. This significantly de-risk the inhaled drug development process. Furthermore, our system significantly reduces the use of animals and costly substance. We and our customers have known this for a long time and the value this brings. However, our customers own the data. We have been limited in what we could share publicly, until now. We have recently finalized and presented the high-level results of an FDA-funded study on our DissolvIt module. This study shows a correlation between the preclinical and clinical pharmacokinetic data. This represents a paradigm shift in inhaled drug development. It's a breakthrough for Inhalation Sciences and a huge opportunity for companies looking to reduce risk and accelerate timelines.
This will be part of our awareness campaign starting this autumn.
Talking about the awareness campaign, can you give us more details about what that is all about?
Please. In addition to the groundbreaking DissolvIt study, there are several macro trends and regulatory tailwind that further support our differentiation in the market. These trends will be key pillars in our upcoming awareness campaign and will be embedded across all our sales and marketing communication. There's a rising interest in inhalation as a route of administration, increasing interest in green propellants, growing focus on biologic drug development. There's a push to lower drug prices by accelerating approval processes for generic and biologic drugs. In the light of that, FDA has recently recommended dissolution testing for the development of inhaled drugs. Furthermore, FDA has announced a plan to phase out its animal testing requirements. Also, the European Medicines Agency revised their guidelines for inhalation products with recommendations of expanded spray characterization, for example.
While these do not exclusively point to Inhalation Sciences, our technology platform clearly differentiates from conventional methods across all of them by providing better predictive power. We will leverage these tailwinds and the DissolvIt study in the upcoming awareness campaign, positioning our services as not only superior, but strategically aligned with where the industry is heading.
Manoush, in terms of finances, you mentioned the closed rights issue before the summer in the report, one of the common questions that we are receiving from investors is, one, how long will the new cash injection last? Two, how do you plan to use them?
The recent rights issue brought around SEK 10 million to the company after all the related expenses. We really would like to see this as the last round of financing for Inhalation Sciences, but at the same time, it all depends on what we do and our activities. We plan to expand our commercial initiatives and increase the market awareness about our unique technology, attending several international conferences, as well as elevate our collaborations with our strategic partners. On the same note, we have continued to manage the cost, mainly on R&D side, resulting in a decrease of R&D expenses by more than 50% for the first half of 2025 versus the same period in 2024.
You mentioned the finalization of the FDA study. What are the next steps here?
We follow the usual publication process. The high-level data was presented in a webinar in May this year. It's currently being worked into our awareness campaign starting soon and will run till this campaign up to the Drug Delivery to the Lungs conference in Edinburgh in December. We use the high-level data in every customer interaction weekly and daily. It's being received with a great interest. An abstract has been submitted to DDL in December, hopefully we'll get an oral presentation as well since it has been co-authored together with FDA. Lastly, together with FDA as well, we will submit a full-length paper in a relevant peer-reviewed scientific journal for wider spread in the scientific community. That could take anything between 4 - 12 months to publication, depend on the choice of the journal.
Any update on the clinical application of the PreciseInhale, and can you give a brief background on this as well?
Sure. A little bit of background. We performed a clinical feasibility study with PreciseInhale for some years ago with 12 healthy volunteers. The main endpoint of the study was to show regional targeting, i.e., to dose exact amount of substance in different parts of the lung, which we know it's a huge challenge in the clinical market. We finalized this study successfully and published the data over two years ago. The next step is to CE mark the PreciseInhale instrument for clinical usage, as well as minor design changes to have the device suitable in clinic. That is exactly where we are. As previously mentioned, we would like to do this together in collaboration with partners and have had several ongoing discussions on the same. Some of these discussions are currently at the final stages, and we should inform the market as soon as finalized.
Finally, Manoush, what would you say are the most important takeaways from the Q2 report for investors?
One, we have secured the financing of the company. Two, we have streamlined organization with full focus on commercial activities and supportive functions in terms of in vitro, in vivo, and ex vivo studies and expertise in-house. Last but not least, we have a steady pipeline of the request and continuous dialogues with potential customers and partners. Some of these discussions and some of these partners can also be more of a strategic nature, resulting in eventual M&A discussions further ahead.
Thank you very much to both of you, good luck here going forward.
Thank you.