Earnings call transcript: Philogen’s Q4 2024 revenues triple, stock steady

Philogen SpA reported a significant increase in its full-year 2024 revenues, reaching €77.5 million, a threefold rise compared to the previous year. Despite the impressive financial performance, the company’s stock remained relatively stable, with a slight increase of 0.25% to €19.90. The company highlighted substantial progress in its product pipeline and strategic partnerships, which are expected to drive future growth. According to InvestingPro data, Philogen maintains a moderate debt level and strong liquidity position, with liquid assets exceeding short-term obligations. The stock typically trades with low price volatility, as indicated by its beta of -88.97.

Key Takeaways

• Full-year 2024 revenues surged to €77.5 million, primarily driven by third-party contracts.
• Operating expenses rose by 20% year-over-year, totaling €36 million.
• Philogen’s cash position remains strong at €113.7 million, with no bank loans.
• The company is advancing its oncology and dermatology drug pipeline, with several trials nearing completion.
• Strategic partnerships, notably with Sun Pharma, bolster its market position.

Company Performance

Philogen’s performance in 2024 was marked by substantial revenue growth, largely attributed to €74 million in third-party contracts. The company managed to triple its revenue from the previous year, showcasing its strong market presence and effective business strategies. Operating expenses increased by 20%, reflecting the company’s investment in research and development and clinical trials. Despite these expenses, Philogen maintained a robust cash position, underscoring its financial health.

Financial Highlights

• Revenue: €77.5 million, a threefold increase from the previous year.
• Operating Expenses: €36 million, up 20% year-over-year.
• EBITDA: Over €40 million.
• Net Profit: €45 million.
• Cash Position: €113.7 million, with no bank loans.

Outlook & Guidance

Philogen anticipates 2025 to be a pivotal year with critical trial readouts expected, with the next earnings report scheduled for May 21, 2025. The company is optimistic about potential market entries in various oncology segments, driven by its innovative drug pipeline. Philogen is also exploring additional partnership opportunities to enhance its market reach and maintain financial flexibility. InvestingPro analysts project sales growth for the current year, suggesting continued momentum in the company’s expansion strategy. For deeper insights into Philogen’s growth prospects and detailed financial analysis, investors can access the comprehensive Pro Research Report, available exclusively to InvestingPro subscribers.

Executive Commentary

CEO Dario Neri emphasized the company’s potential to achieve blockbuster status, stating, "We can reach blockbuster status if we can treat 10,000 patients per year." He also highlighted the promising prospects of the ACP3 program, noting, "The ACP3 program has the potential to do better than PSMA." Neri assured stakeholders of the company’s commitment to expediting patient access to its treatments: "We are working full speed to make sure that this reaches patients as soon as possible."

Risks and Challenges

• Regulatory Approvals: Obtaining necessary approvals for new drugs remains a significant hurdle.
• Market Competition: Intense competition in the oncology and dermatology sectors could impact market share.
• Clinical Trial Success: The outcome of ongoing trials will significantly influence future growth prospects.
• Partnership Dependencies: Reliance on strategic partners like Sun Pharma may pose risks if collaborations face challenges.
• Economic Conditions: Broader economic factors could affect investment and spending in healthcare.

Philogen’s strategic focus on innovation and partnerships positions it well for future growth, despite the challenges ahead. The company’s robust financial performance and promising pipeline offer a solid foundation for continued success in the competitive pharmaceutical landscape.

Full transcript - Philogen SpA (PHIL) Q4 2024:

Emanuele, Chief Operating Officer, Filogen Group: So welcome, everybody, to our new webinar. Today, professor Darroneri, our CEO, doctor Lara Baldi, our CFO, and myself will provide an update on our latest financial and scientific results. We’ll have a presentation which will last about forty minutes, which is being recorded. And as always, we’ll be followed by a q and a session, which is not recorded. To ask questions later, please remember to either write the question on the chat or raise your hand, and we will unmute you.

So with this, we go directly to the presentation with the latest exciting results, and I hand over the stage to Darioneri.

Dario Neri, CEO, Filogen Group: Thanks a lot, Emanuele. Together with Emanuele, as always, we’ll give the presentation, and these are exciting times after good results for the year 2024, which have just been published last week in a dedicated press release. So as always, we start with a forward looking statement, and then we a few slides of introduction. I’ll be very brief, especially for those who have seen this presentation before. The Filogen Group is a Swiss Italian company, and it has two souls, so to say.

The Filogen Group deals mainly with antibody therapeutics. So each time you see green in the presentation, this is antibody drugs. The Filochem unit, which is a fully owned subsidiary of the Filogen Group, focuses on small molecule therapeutics. So blue is small molecules. Green is antibodies.

Now everything we do within the company follows a simple but very powerful principle. We use payloads of proven therapeutic activity. They can be drugs, radionuclides, or cytokines. And we make them better because we deliver them to the site of disease. So whenever the payload is small, like a drug or a radionuclide you see indicated in blue, we will use small ligands for pharmacodelivery, typically isolated from DNA encoded chemical lipids.

Whenever the payload is a protein like a cytokine, then the ligand, the delivery vehicle will be an antibody fragment. And you will see that basically the the blue part of the pipeline coincides with phyllochem, and the green part of the cytokine pipeline coincides with phyllogen. Now the need for targeted delivery, so for this ligand based pharmaco delivery, is clearly indicated in this slide. You look at four patients with cancer, and they received four different types of drugs. The drugs were radiolabeled.

So wherever you see black in the body of a patient, this is where the drug went. And the need for targeting is very clear. You start at the very left, a patient with mesothelioma. So the the tumor is in the pleura around the lungs. The patient received conventional chemotherapy.

And basically, you see that there is no preferential accumulation in the tumor. If anything, you have excretion via the liver, spleen, a feces, urine, but no preferential accumulation in the tumor. With large antibodies, IgG molecules, Y shaped, these are molecules which extravasate very slowly. They get out of blood vessels very slowly. They target tumors very slowly.

It may take several days until you see a preferential accumulation in the tumor. With our antibody fragments and especially with antibody cytokine fusions, this is what phyllogen does. The selectivity is much better. This is one of our patients imaged only one day after IV administration of the product. You see good tumor to organ ratios and probably and you will see many examples.

The world record of tumor targeting happens when we have small ligands of exceptionally high affinity that bind to a target with antibody like affinity. But being small, they get to the target much more rapidly. See a patient with metastatic breast cancer, see at just sixty minutes, the primary tumor in one breast, many bone mets, liver mets, and nothing else. So as a patient, I prefer to receive this type of selective therapy rather than nonselective chemotherapy. Now we will go together with Emanuele Puka, our Chief Operating Officer, slowly through the pipeline.

We will look at Nidlegy with me, our dermatology drug. Emmanuel will guide us through the progress with fibromon, where we completed recruitment in a number of trials with registration potential. And then I will finish with the chemistry pipeline. You see it’s a phase one pipeline, but results are really, really good. And I think they hold a lot of promise even if molecules are still at the phase one level.

But you will judge for yourself. So let’s start with Nidlage. Nidlage is an immunocytopen product that we initially developed in melanoma, but later we have seen that it works very well also in non melanoma skin cancer. You see that there are three main types of cells in the skin, melanocytes, basal cells, squamous cells, and the corresponding tumors are called melanoma, basal cell carcinoma, and squamous cell carcinoma of the skin. They have high in sedation incidents, not only melanoma, ninety seven thousand new cases per year in The United States, but even BCC and SCC have greater incidents.

And you will see really with pictures what the medical problem is. Let’s start with melanoma. Needlegy is a combination of two proprietary active principles. We give this product intraditionally because we deal with superficial tumors, and you will see we are active both in melanoma and in non melanoma skin cancers. We have already presented the fact that last year, we announced the results of our first Phase III clinical trials in locally advanced melanoma, two fifty six patients randomized in two arms.

In one arm, they received surgery within four weeks, if appropriate, followed by adjuvant treatment. In the treatment group, the surgery is preceded by four weekly injections of the product. And we look at recurrence free survival, in other words, how long the patients stay without a recurrence of the disease. And basically, these are the data that Axel Hausscheld presented at ASCO on behalf of the investigators. You see that the control group in yellow has median recurrence free survival of six point eight months, whereas there is a substantial prolongation of RFS for the Nidlage group, more than doubling of a time dependent endpoint in oncology.

A good result, we go from six point eight to sixteen point seven months. This has been the basis for the marketing authorization application that was filed with EMA on June, and it’s in the process of being evaluated. In summary, in Europe, we have completed Phase III. We have filed the marketing authorization application, and we expect a decision around summer. We are running a parallel study in The United States, One Hundred And Nineteen out of the one hundred and eighty six patients have been enrolled.

And we are in dialogue with regulatory authorities in The United States, both in melanoma and in non melanoma. In particular, we are curious to learn whether the European data are sufficient for a marketing authorization application also in The U. S. Or we need to complete the EU study first. And we have a distribution agreement with Sun Pharma.

So we have all duties until registration. Sun Pharma is already active for early access programs for this drug, specifically in France and in Germany. And if the product is approved, Sun Pharma will commercialize it in Europe, Australia and New Zealand. I want to share with you some exciting data in non melanoma skin cancer. We start with this picture that you have seen before.

It has now been published. It corresponds to four patients in the Duncan study. Actually, we had ninety four patients in the Duncan study which were treated, and the study is complete. It’s one of the two phase two studies that we had promised to complete. The other one is called INTRINSIC.

And whenever we see patients like this who are candidate for disfiguring surgery, in this case amputation of the nose, and you see such a good outcome, then of course we are very happy. I want to give you some really pictorial impression of the benefit that we believe actually the product is giving already now. And they look at somewhat less advanced cases of BCC, but still advanced enough to require this figure in surgery. You see, these are data from the collaboration with University of Tubingen. You look at a patient with something that looks very innocent in the nose of this patient.

But this is a basal cell carcinoma, which is growing deep. And so even though the lesion looks small, the surgery is quite extensive. And I’m showing you the nicest of the pictures because the other ones are much warts. And you can see that these patients can really have disfiguration surgery to get rid of the tumor. So what can we do?

This is an interesting example, and I’m extremely grateful to the collaboration with Lucas Flats, Theresa Maral, and collaborators in Tubingen. Because, basically, this is the experience of a patient in 2023 who had a small lesion and required a skin flap, which is ugly. This skin flap will be with the patient for the rest of her life. In 2024, a new lesion similar lesion was coming up, and you see that the cosmetic outcome is completely different with Nidlej. And I want to show you two extreme examples.

This is a young patient who had a lesion in in the lip, but the surgery would have been extensive and really would have disfigured the the the lip for the rest of her life. When I looked at the results, this is the one year result. I I said, wow. Because, of course, you don’t see anything, and the outcome is very good. Now I’m showing you a young patient, and I want to show you at the other extreme, a 94 year old female in this case with the squamous cell carcinoma of the cheek.

She was candidate for amputation of the cheek, which she didn’t want to receive. And you can see a complete response at day three sixty five, again suggesting that the product can be active in younger and in older patients and the treatment can be tolerated. So it’s work in progress that can be summarized with the DUNCAN and the INTRINSIK studies, which are ongoing. So the DUNCAN has been completed, and the results will be presented at major congresses this summer. INTRINSIK is still ongoing with thirty nine out of seventy patients treated, but we have made all preparations to launch three trials with registration potential that will complement the data that we have already accumulated.

And you see ninety two, ninety two and up to 180 patients. This will be global studies, so Europe and United States. So with this, I hand over to Emanuele just mentioning that the commercial potential is attractive both in melanoma and in non melanoma skin cancer. If I give you the number of addressable patients for locally advanced melanoma, it’s about twenty three thousand new cases, Europe and United States. For BCC as one of the non melanoma skin cancer, you see that the number is possibly even greater.

And the expected pricing is in this range, at least based on the price at which competitor drugs are sold. So we continue to be very excited about the product and even see more opportunities for helping patients at the stage that maybe at the beginning, was difficult to get patients because they would go directly to the surgeon, but now it’s the surgeon that sends the patients to the trials because they have seen that the benefit can be tangible. With this, I hand over to Emmanuel Epuca who will tell us about the second most advanced program, fibromon, on which he has been directly active for a number of years.

Emanuele, Chief Operating Officer, Filogen Group: Thank you, Adario. So you remember that, Fibromun is now also partnered with Sun Pharma since last year. We have expanded the collaboration. It is going very well from Nidelegi in Europe to Fibromun, which is now a global partnership for all oncology indications. So we have three trials in sarcoma with Tabuta Potential, two of which have completed enrollment, and we have also three trials with TABUTA potential in glioblastoma for which I will provide an update.

You remember that glioblastoma is a deadly disease. We have at least fifteen thousand new cases every year only in The US. In Europe, it’s even more. So in total, we have more than thirty thousand new cases every year to that are addressable by potentially, fibromun. And you see, unfortunately, today, there is no curative treatments.

Patients that have a recurrence of a median overall survival of eight months, so it’s very fast, unfortunately. And the situation in sarcoma is not better because we’re speaking about thirteen thousand six hundred cases every year in The US, about fifteen thousand in Europe. And, unfortunately, most of them become metastatic, and when they become metastatic, they’re also incurable to date. Here, the median overall survival is also similar to the one of glioblastoma. So what is febrile wound?

Just as a quick reminder for the new people that are attending this webinar, it’s an immunosidocaine, so antibody, cytokine fusion protein. The Lantin antibody targets the tumor and delivers TNF, the anticancer payload selectively at the site of disease. The drug is given this time systemically by intravenous infusion. We have orphan drug status both in Europe and in US for both indications, and we have showed several times that the product goes through the tumor sparing healthy tissues, which is the basis for targeted therapies. Quick update on glioblastoma, which are progressing at record speed.

In for Gliosan, the trial in newly diagnosed patients were have completed the phase one part. We’re cleaning the data, which will be presented to the next webinar as soon as the data have been cleaned up. In Gliostar, and we’re discussing with Sun Pharma transition to phase two and to the phase two b part. For Gliostar, we have completed the last in this in June 2023, the phase one. And the phase two part has progressed very rapidly, and you see that we have enrolled a 56 patients out of 58.

We’re missing only two patients to complete enrollment. Then we will have to wait the for the overall survival events, so meaning death, to mature, to read out the study, and we expect that to happen by the end of this year or beginning of next year. In parallel, we’re also conducting a US based study that was agreed with FDA, which also is the enrollment rate is progressing faster than we expected. We are already at fifty two patients out of the 90 to be enrolled. And here, the strategy is pretty clear.

Use Gluestar if we meet the primary endpoint to get full approval in Europe, and we use both Gluestar and Gluestella to get approval in The US, of course, always if we meet the primary endpoint. In soft ear sarcoma, we have also completed enrollment of two out of three, and we have completed enrollment of two out of three pivotal studies that you see here below. The first one is in phase three, a phase three trial in combination with dox in first line patients. We have completed enrollment. We are enrolled a bit more than the protocol for so.

This is allowed, by the protocol, and we’re missing only one event. In that case, a event means progression free survival, so progression or death. And, basically, we’ll communicate the outcome of the study when we meet the event and when we have cleaned up the data, which will happen in the next few in in the short term future. The same similar consideration also for the third line trial in so patients with last line soft eu sarcoma. This time, the combination partner is dacarbasin, the standard of care for these patients.

We’ve completed enrollment. We’re missing six events. So, also, here, an event is progression or death as the primary endpoint is progression free survival. So for both trials, we should expect to communicate the results in a short term future and to basically tell you how it went. And if we meet the primary endpoint, we will submit the marketing authorization application to EMA and also start a dialogue with FDA to use European data to get approval in The US.

So exactly similar situation as we’re now facing in melanoma. Here, the market potential is pretty attractive first because those are high unmet medical needs for which you can expect a high pricing, even higher than a hundred thousand hundred 60,000. This price is based on what oloratumab got in The US that was conditionally approved for soft tissue sarcoma. Plus, there is very little competition. Well, unfortunately, most of these conventional drugs failed in the both glioblastoma and soft tissue sarcoma.

And, also, we’re speaking about medium sized indications in sarcoma. At least this is a worst case scenario of twenty one thousand patients. In glioblastoma, it’s more than thirty thousand. So and for me, the primary endpoint, we have a a good avenue to get a good market penetration and to turn this product in a really also blockbuster if everything goes well. With this, I hand over the stage to Dario again for the chemistry.

Dario Neri, CEO, Filogen Group: As I told you, we go from phyllogen to phyllogen, and this blue pipeline is progressing very rapidly. You will like the data because I think they’re really sensational. The quest, as mentioned before, is really to further improve targeting selectivity. And the hope is, of course, that if we have such a good selective uptake of the drug at the site of disease, hopefully, we will have more potency and fewer side effects. These are two patients with malignancies positive for so called fibroblast activation protein, FAP.

The patient to the left The patient to the right was imaged with one of our small molecule drugs called OncoFAP. I think it’s fair to say that the small molecule wins, at least at the level of nuclear medicine. So what we do is we use our proprietary DNA encoded chemical libraries to discover high affinity ligands. I repeat, high affinity ligands because high affinity is essential in order to win in the clinic.

And then we can decide to put different payloads onto this vehicle. Today, I will focus only on radionuclides and drug conjugates, but we have additional programs which are in development. And maybe in one of the next webinars, we will cover them as well. So let’s start with targets for which we have validated nuclear medicine data. We go from FAPA to carbonic anhydrase nine for which we have now a second ongoing Phase one clinical trial, which has started PSMA, somatostatin receptor two and especially ACP three, and I’ll focus on FAP briefly, but mainly on ACP III to give you a good update of what’s happening within the company.

Let’s start with FAP. In this case, I first focus on programs with adenyclides. For imaging, we have collaboration with the Braco Group. We have licensed the rights to Blue Earth Diagnostic, which is a company of the Braco Group. We have completed successfully a Phase I clinical trial with dosimetry run by Filogen as a sponsor.

And we have actually, with our collaborators, now imaged more than 300 patients even. And here you see five representative patients, but the, you know, the selectivity of these black spots, which is the accumulation of OncoFap in the lesion, is pretty sensational, and it helps patients already at the diagnostic level. Of course, many patients want therapy, which means that once they see an uptake of OncoFab with a diagnostic radionuclide, they want lutetium-one hundred seventy seven, which is a therapeutic radionuclide. The Phase I trial has started. The first three patients have received our agent.

It’s work in progress, and we are excited to see the development of this trial. Now, we can also decide to equip ANCOFAP with a non radioactive payload, in this case, with a link drug conjugate. And the molecule looks like this. FAP is not only a target, but it’s also an enzyme that cleaves after glycine and proline. So it came natural to us to develop our product with OncoFAP, this blue moiety, which is the part that goes to the tumor.

GliPro here indicated in green is the part which is cleaved by FAP at the site of disease. And monomethylaurestatin E is a very potent there is a typo here. It’s a tubulin inhibitor, but it’s a very potent drug that is conventionally used for cancer therapy. Now this is something we have shown already, but it’s a very nice result. We decided to go into a phase one trial in animal patients with cancer.

This was the first dog that entered the study. Coco, the dog had, you see, a sarcoma. You can see it in the in the CT scan. You can see it with caliper measurement. The first dose that was given was three point five mgs per meter square, which is the lowest dose we consider.

By protocol, we could only give four injections once a week. So after four weeks, you could see that the tumor had shrunk, was still present, but was much smaller. But by protocol, we couldn’t continue treatment, which actually we would have liked to do. So we had to wait. And several months later, actually, the tumor grew back and grew very large.

You can see a diameter of 15 centimeters. This time, we could give a higher dose, ten milligrams per meter square. And again, with only four injections, you see how the tumor was shrinking and how also the CT scan shows that a big portion of this mass had disappeared. So this and other data suggested that we were observing potent activity with extremely tolerated, you know, performance. And now this product is moving towards clinical trials in humans.

And the last topic, last but not least, that I want to mention is a wonderful collaboration with colleagues at University Hospital in Munster, Professor Michael Scheffers and Professor Phillip Bachaus that I would like to honor with this slide. I will show five slides, which are the fruit of their research. The data also coming out in the literature with Francesca Milarini and Tony Georgiev as first orders and Sebastian Ehler and Samone Katzamali are senior orders. The target is ACP three. So what is the story?

The story is that we can do better than PSMA in the field of radiopharmaceuticals for prostate cancer. It’s a huge field. I show here three products which are on the market, two for imaging and one for therapy. ILU6 is for imaging with gallium sixty eight. Pillarify is for imaging with Fluorine eighteen, and they sold last year, respectively, USD 500,000,000 and USD 1,000,000,000 plus.

So together, USD 1,500,000,000.0, more than USD 1,500,000,000.0. The therapy product, Pluvicto, has lutetium-one hundred seventy seven as radionuclide, and it sold last year more than USD 1,500,000,000.0. So together, the market of PSMA pharmaceuticals in prostate cancer is more than $3,000,000,000 However, the target has liabilities because you can see that PSMA ligands also go to salivary glands. They go to lacrimal glands. They go to the kidney, and this undesired uptake in normal organs precludes a suitable dose escalation.

So the dose of radioactivity which is given is suboptimal. You see that patients who receive the lutetium product, they benefit because time to progression gets longer. But eventually, after eighteen to twenty months, basically, all patients progress. So our proposition was to do better than PSMA also because we would spare normal organs. We have chosen to go for a different target, which is called ACP3, acetic phosphatase three, and you see a comparison with PSMA by immunohistochemistry.

So what you see here are tissue sections stained if the target is present. You see it in brown. And let me focus, for example, on kidney. You see that no surprise that the PSMA pharmaceuticals go to kidney because there is the target, the PSMA target in the kidney. You see how clean ACP3 is in normal organs.

If we look at tumors, and these are serial sections from the same patient, always pairs, you see that for some patients, both PSMA and ACP3 are both good. You see a lot of brown staining. But for example, in this patient, there is a lot of ACP3, but there is not a lot of PSMA. And this is quite a frequent situation. So at least based in immunohistochemistry, we expected to do better.

Thanks to Dell technology, we discovered and patented very potent ACP3 targeting agents. And of course, when we use nuclear medicine, we can choose to use, for example, gamma meters or beta plus meters for imaging. That would be PET or SPECT, but we can also choose to use electron or alpha particles for therapy. And respectively, the payloads would be lutetium 177 or actinium two twenty five. So different radionuclides for different indications.

Let’s start with imaging. I’ll show you a few examples of metastatic cancer and also patients at early biochemical recurrence, and you will see the benefit that the colleagues in Munster could show for this type of patients. This is a first patient. All examples will show really sequential imaging with PSMA and ACP3, so you can really compare the two situations well. This is a patient who had unfortunately very extensive metastatic disease.

So you see the bone metastasis, like all these black dots. They’re very easily visible with ACP three. At one hour, the kidneys, you can barely see them. Okay? So it’s extremely clean background.

And with PSMA, I would argue that the uptake in the tumor is lower and the liabilities in the organs, in the normal organs are clearly visible. Another patient was originally planned for radiation therapy. They thought of this solitary lesion in the thorax. You see the accumulation of the PSMA ligand in normal organs, which is undesired. Actually, with ACP3, we discovered that actually there are more lesions.

You can easily see four very strongly absorbing lesions, and the background is much cleaner. In the early biochemical recurrence, this is an interesting case. A patient who was treated for the primary tumor in the prostate, still had prostate. The PSA levels went up. If you do a PSMA scan, you see the normal organs, but you don’t see anything strange in the prostate.

With ACP3, a recurrence was clearly visible, which immediately changed the management of the patient. This was a patient with prostatectomy, so had the surgical removal of this prostate. And then the PSA levels after some times were rising again. And by PSMA, you couldn’t really tell anything strange happening. But with ACP III, we immediately see this small but very intense uptake in the pelvis.

And in the transaxial scan, this yellow spot confirms this is a bone metastasis. And when irradiated, the PSA levels dropped, again confirming that we could reveal a bone metastasis, which again changed the management of the patient by simply knowing where the tumor was growing back. And maybe a last case in which you see a single osteos metastasis coming back. So this is an extremely intense uptake. You see with PSMA, SUV of 105 is almost a record.

If you have SUV, so standardized uptake value more than 10, usually, there is a therapeutic benefit. But you see that there is also an uptake in normal organs that would receive radiation in a therapy setting, lacrimal glands, salivary glands, liver, kidney. You see the ACP3, the uptake is now two ten, and this is record high with an extremely clean background. So we think we have a very good molecule, and we are active discussion for how to best develop this product alone or in partnership. And with this, I hand over to our chief financial officer, Laura Baldi, who will discuss the last two slides with the financial review for the full year 2024.

Laura Baldi, CFO, Filogen Group: Thank you, Dario. So the first the first slide is an an overview on financial of the full year 2024. The Filogen Group closed the full year in very good shape. Strong increase in revenues, which came at €77,500,000, so three times more compared to the previous year and driven mainly by revenues on contract of third parties. The value of that type of contract is €74,000,000, and the remaining part is related to other, other income.

We remember we remind that the for the moment, the group, doesn’t have a stable stream of revenues since, it doesn’t have product on the market, but it records, on the income statement, the amount of upfront payments, milestone, and revenues from services rendered based on contract in place. Before we move on the operating expenditure, this line is still under control and well balanced considering the substantial progress of the key ongoing clinical trial. OpEx stood at €36,000,000 plus 20% compared to the previous year. And costs are mainly related to cost of goods, preclinical and clinical activities, personnel costs, and other operating costs. Number shows that there is a fifty fifty amount of personnel cost.

It’s more or less half part of the OpEx, and the remaining part is the core business activities. So consequently, the EBITDA and the EBITDA are well above the breakeven. We closed the year with an EBITDA over €40,000,000, and the group closed with a record net profit of €45,000,000 benefit from a positive tax impact linked to previous losses forwarded. Also, the net financial position is is very good. Liquidity is over a hundred and €10,000,000.

No bank loan. So the net financial position is impacted only by notional lease liabilities. So we have a very ample cash position. And in the second slide, we show in a bridge, in a graph, the the cash burn. So the cash and cash equivalent at the beginning of the year was €75,300,000.

We increased this cash with more or less the same amount, 72.1 cash in from r and d proceeds. The operating expenditure is €33,500,000, more or less €3,000,000 for mount, so very, very controlled spending, 3.2 in CapEx. We just leave the line of buyback to remember that we have start again our payback program, but in December, the amount was not significant. And we had holes in the year, a positive contribution on the financial items, so €2,900,000. And we closed the the year with the cash and cash equivalent of a hundred and €13,700,000.

The debt position, as I said, we the group has no bank loan. So the difference is only related. The $11.912.00 euros are only related to the notional, lease liabilities, so it’s accounting representation. And, we want to highlight that, we have also more than €10,000,000 of tax credit that we hope in the future could help to, to contribute to our cash burn. So this is just, impills our, financial of the 02/2024, and I thank you and over to our chief executive officer, Dario Neri.

Dario Neri, CEO, Filogen Group: Thanks a lot, Laura. And, again, the last slide is only a summary. You have seen that the program with Nidalegi is really on track. But, the non melanoma skin cancer data, I would say, are even nicer. And they continue, you know, to surprise us every month.

So we are very fond both of the potential melanoma and non melanoma skin cancer. I think we have delivered everything we had promised in terms of completing the sarcoma trials in the expected timelines. We have gone faster faster than planned in glioblastoma. Twenty twenty five would be a very important year for us because there will be readout in a number of trials with registration potential. You have seen for FAP.

So this is the filochem part of the pipeline. Good progress with radioactivity both for imaging and for therapy, but also at the level of nonradioactive drug conjugates. And while we have many activities, more than the ones that you have seen, I really would like to single out the ACP three program because this has the potential to do better than PSMA, which is an established target in the field of radiopharmaceuticals, and we are working full speed to to make sure that this reaches patients as soon as possible. And with this, I hand over again to to Emmanuel. I think the recorded part of the presentation finishes now.

If there are discussions, we will be delighted to brainstorm.

Emanuele, Chief Operating Officer, Filogen Group: Exactly. We opened the stage for discussions, and I see Rajan. Please go ahead.

Rajan, Analyst/Investor: Hey. Thanks for taking the question. So one question on OncoFab. So I know that, as you said, the current payload is MMAE. Just wondering if it’s possible with the technology to use alternative payloads.

So if there’s any kind of issues with the linker that we should be we should be mindful of that. And then I don’t know. I I had a quick one on the financials, but maybe you wanna take the first one first, and I’ll follow-up.

Dario Neri, CEO, Filogen Group: With pleasure. Actually, I’ve only shown a small portion of a lot of work that we have done with OncoFab targeted delivery. We have published several linkers for the delivery of monomethyloristatin e, so MMAE. And GliPro was the winner. And this was not only based on, you know, theoretical consideration.

This happens to be the substrate of FAP, but also, you know, we really ran different linkers, including the conventional linker one against the other. We can get good therapy also with the linker, but the Grip Pro linker is is better. We have other classes of payloads which are not yet disclosed, but we could get curative results also for those payloads, At least the, you know, the irinotecan analogs, these are described in the literature by now. But we have also immunomodulators which are not yet out, but for which we have good results, and they will be So, really, the OncoFab platform is a platform which is well validated at the level of nuclear medicine, and it enjoys the benefit of having a companion diagnostic so that you could select patients and then give the therapeutic.

So a lot of work, and you you can imagine that we are now very fond of this first step of testing for clinical activity in animal patients. So dogs with spontaneous tumors that have failed all therapy, including chemotherapy. So when we see activity in this setting, not only we provide the benefit to the dogs, to the owner, but also we have a very strong rationale to move to the clinic with clinical trials. I’ll I’ll pause here. I don’t know if you have follow on questions of scientific nature before going to the numbers.

Rajan, Analyst/Investor: Can you can you still hear me?

Dario Neri, CEO, Filogen Group: Yes.

Rajan, Analyst/Investor: Okay. Perfect. Yeah. Just on the on the on the numbers, Laura, I guess kind of conscious as you mentioned that there’s not a consistent revenue line. So it would just be helpful to get some context about how you’re thinking about revenues evolving into 25%.

Do you expect growth? And then similarly on OpEx, just thinking about particularly on the R and D side of things given that potentially some of the larger trials could be rolling off this year. And then it’s kind of the earlier stage pipeline that’s coming through. How should we think about those two pieces?

Dario Neri, CEO, Filogen Group: I’m also happy to to take at least part of the question because I think, you know, the question is a pertinent one. It says, you know, if we are so ambitious about clinical programs, you know, will the spending explode? There has been a modest increase in spending, which is justified if you think how many patients we study every year. However, I think that this is one of the virtues of the company. There are small and medium sized enterprises that contract out everything, and then clinical trials get very expensive.

I think when you tend to manage trials, you know, within the company like we do, then clinical spending is much more reasonable. And I give you a few numbers. So a typical cancer patient in a company sponsored trial in Europe will cost you around €30,000. In The United States, maybe anything between 50,000 and maybe hundred $20,000 depending on the complexity of the trial. So if you if you take it to an extreme, hundred patients studied in Europe in one year, they would be something like €3,000,000 direct clinical costs.

And this number may grow a little bit if you do it in The United States. At the same time, while we are starting new trials, we are finishing old trials like the NIDLEGE trials. And this is the reason why we don’t really foresee an explosion of costs, again, as long as we are able to run these companies largely with operational capabilities within the company. I don’t know if I’ve answered your question, Rajan.

Rajan, Analyst/Investor: Yeah. No. That’s that’s very clear. Thank you.

Emanuele, Chief Operating Officer, Filogen Group: Ricardo Rommiotti.

Isaac, Analyst/Investor: It’s for

Ricardo Rommiotti, Investor: us? Can you hear me? Okay. Chaudario, Chauduca. Hi, Laura.

Have two questions. First of all, finally, we have seen a couple of slide stating very in a very easy way and very and very clear how could be the market potential on the two well, let’s say, the meter g m and on the other one. It’s very good. It’s very nice, but can you give an idea of the percentage of penetration that you suggest you can have in this market? Because if you get a % patient, okay, it’s a champagne problem, but I do think that there would be someone else that is, in any case, maintaining their position.

So what is what you think could be for a blockbuster medical treatment as it looks like being the the midlagy, a fair penetration, percentage penetration on the market?

Dario Neri, CEO, Filogen Group: Right. It’s very difficult to estimate this in advance, but I can give you some guidance. First of all, we are learning about the acceptance of the group from the early access programs. These programs are managed by our partner, Sun Pharma, and they are already operational. They are not remunerated in Germany.

They are remunerated in in France. So this is a question that you would have to ask Sun Pharma, but we are very pleased that the program started according to plan. We are learning about the appetite for the drug, and we are certainly happy to provide the drug before the marketing authorization. Now let me be precise on how many patients and what type of penetrance do we need for reaching blockbuster status. So if the pricing is confirmed at around a hundred thousand US dollars per patient, you reach blockbuster status if you can treat 10,000 patients per year.

And this is basically the the the mathematics. You know? Hundred thousand Yeah. Times ten thousand patients. So the incidence of the disease suggests that even if a portion of those patients were really treated, the economic benefit would be the one that I’ve mentioned.

So unfortunately, I cannot estimate whether the market penetration will be 10% or 90%. This we will learn experimentally. I can tell you that in oncology, anything has happened. And I give you the two extremes. Gleevec was a Novartis drug that, to my knowledge, had development stopped twice because analysts thought that it would sell at most 50,000,000 US dollars per year.

It ended up selling more than 2 billions per year. And the difference between the estimates and the real market data were because the the drug was so good that the market penetration was close to 100%. And second, the drug was effective over a long period of time, so patient would stay several years on on this drug before shifting to something else. So it’s difficult even for very large and successful companies to make a careful estimate of market penetration. But what I want to say, even with a fairly small market penetration, the product retains blockbuster potential.

And, you know, we will know soon one step at the time. First, we have to see if we win as we hope the marketing authorization. And then on, you know, three months by three months, we can see how well we do.

Ricardo Rommiotti, Investor: Second things that which I’ve already spoken about in these recent days. Can you clarify one point on your recent press release regarding the numbers the full year numbers where there is a small part where you mentioned that the board of director of directors could propose to the next general meeting the authorization to rise up to 20% of of the capital. So if you can clarify this point in a very precise way, we would appreciate.

Dario Neri, CEO, Filogen Group: No. With pleasure. I mean, this is an option which the company has always had, you know, ever since the first day of the IPO. So the company has the freedom to raise cash if and when the board feels that this is the good thing for the company. As you know, many biotech companies treat the follow on offerings almost as a, you know, going for cash when they need it.

If you look back, we have now been a listed company for four years, and we have never gone back to the market for a follow on offering. So we like to have the option to do it. In the future, as in the past, we have not done it in the past based on the numbers and the science that you have seen now. I would say there is no need to do it. But the company should always have the option to do it, and that’s what has been authorized now.

I don’t know if Laura wants to expand to be more precise, but this is an option that we had, and we always would want to have if the company works well. We obviously don’t need it.

Laura Baldi, CFO, Filogen Group: It’s perfect. It was part of our at the time of the IPO. So now we just renew it because it was expired. But the reason is the ones you have explained. It’s an option that the board have and can use in case some some opportunities will come.

But it’s an option. It’s a common provision in all listed company in all listed company. Our consultant illegal consultative suggest to have and it’s also part of the bylaw, not only a decision of the board.

Ricardo Rommiotti, Investor: Permit me, and then we close. Permit me that is not something that is not preview for every listed company, first. And second, I understand, Dario, when you said that it’s something that was written at the time of the IPO. And in my opinion, at that at that time was needed because, correctly, biotech company could have or would have the the the need to raise money for a scientific and for their proposed. But as correctly, today, we are in a very completely different situation.

So due to the fact that the the the the the liquidity situation on the market is not so clear, I would have thought something different to put something different on on on the on the press release.

Dario Neri, CEO, Filogen Group: I I understand that. Really, the company wants to have full freedom to react based on conditions, and I give you an example. I think you have seen a number of products in our presentation that I think are performing very well and could be very attractive for deals. If you look at the field of radiopharmaceuticals for therapy, for example, recent deals have worked have been worth anything between hundred million US dollars to more than 2,000,000,000. So you could say, I can make a deal.

I finance the activity of the company for the next forty years. It’s also true that you open champagne once the deal is signed, if all the conditions are right. It can happen. It has happened to us in the past that we had opportunities to sign deals, but the conditions were not right. And so it’s very important for a biotech company that it always have the opportunity to develop the product internally if the company feels that this is the right thing to do.

If necessary, as we have shown for needlingen, for fibromole, all the way until completion of phase three. But of course, we think that there are different opportunities for different products. At this moment in time, I don’t think that it’s likely that we would make a raise because the company is doing well. But we certainly always want to have all the options available, and that’s the meaning of the approvals at regular time intervals. Thanks a lot.

Then we see Isaac, I think, also

Ricardo Rommiotti, Investor: wanted point.

Emanuele, Chief Operating Officer, Filogen Group: Is Isaac?

Isaac, Analyst/Investor: Good afternoon, everybody. Hope you can hear me. Two questions on my side. The first one is on melanoma trials. You mentioned these three registrational trials.

Can you give us a bit more color on the timing we should somehow think about for the recruitment phase? And then also if readout is faster or slower compared to melanoma? And then I will make the second question later on.

Dario Neri, CEO, Filogen Group: It’s a good question. It’s a question for which we would like to know the answer ourself because this will only emerge from the dialogue with regulatory authorities. We see two types of patients, and they will have to be handled differently. And we are in constant dialogue with the regulatory authorities. If you look at one situation, they would be the high risk locally advanced BCC and non melanoma and and SCC patients.

These are patients who typically would have failed alternatives. They would face disfiguring surgery, and they want to receive needledgy. We have asked for scientific advice both from EMA and FDA. We have received scientific advice from both authorities, and both authorities have been extremely clear that in this high risk setting, the straightforward avenue of development is in third line for BCC and in second line for SCC. What does it mean?

It means that the trials that are starting now for BCC in Europe and in The United States are in patients who no longer benefit or maybe have never benefited from hedgehog inhibitors and PD-one blockers. Whereas we are in second line for squamous cell carcinoma, which means patients who have not benefited from PD-one blockers. Now I’ve given the numbers. I’ve not given time lines. So what does it mean?

It means that ninety two patients are the number of patients that we have to study in these trials. We can only say how long did it take us, for example, to recruit these patients in the DANKAN trial, and that was between one and two years. But of course, each trial is different, and we will learn as we go. The other part of the question is how will authorities react. These are open label trials in which you record results on the fly, and you don’t have to wait for an unblinding.

So these are trials on which we can constantly go to the authorities. And especially if and when needlage is approved for melanoma, then it’s easier to go to the authorities with the new data and see if the new data set is sufficient. And I want to give you some numbers. If you sum the number of patients in Duncan, Ninety Four, plus the number of patients in Intrinsyc, seventy, plus the more than 200 patients that we will study with the new trials, we will have substantially higher number of patients in non melanoma skin cancer than those that were required for the registration of Erivedge, Odonso and Libtayo. So it’s many words only to tell you that I think that recruitment can be managed because we managed it in the past.

And also, we have the opportunity to have a constant dialogue with authority. Now where is the difficulty? The difficulty is really whether you only go for the extremely high risk patients with very extensive disease or you also care for those patients with smaller lesions where, however, the impact of surgery can be terrible. And this is again a very fine line because the high risk patients may be, I don’t know, zero point eight percent, one percent of the total cases. But you go to the patients like I showed in the slide, they can easily be more than five percent of the total population of BCC patients.

So, again, I apologize. Many words because we don’t know the answer, But the dialogue both with the MA and FDA is very good, and it continues at regular intervals.

Isaac, Analyst/Investor: Got it, Dario. Thanks. Second question is on the small molecule, say, side of the business. Considering your growing excitement on OncoACP three, very high level one, what’s the strategy for this? You go alone looking for a partner?

Yeah. What’s the plan?

Dario Neri, CEO, Filogen Group: It’s a very good question. And I have to say the field of radiopharmaceuticals is a booming field, and it requires very specific supply chain provisions because it’s not, you know, a non radioactive drug that you can store and maybe you can distribute later. If you think for imaging, you need to label and give the product to the patients within a couple of hours, and this requires huge complex logistic procedures. You typically do the radiolabeling at night. You fly the drug with helicopter, and it’s given to the patient in the early morning.

And for therapy, the logistics are less complicated because the half life of low tissue is about one week. But you still have to make central labeling, ship the radioactive product to different sites and then use it in the clinic. So many words only to say that we think that ACP3 is a perfect product for partnership with companies that have established supply chain and expertise in the field if the economics are appropriate. You have seen that the field has multi blockbuster potential. And then I think the short answer is if we are able to sign a good deal with a very strong partner, I think this could be a very good strategy and owner for the product.

But if this doesn’t happen, I think we have the skills and the resources to continue the development. But I would say the preferred strategy would be a good partnering and development agreement.

Isaac, Analyst/Investor: Makes sense. Thank you, Otavio.

Emanuele, Chief Operating Officer, Filogen Group: Thank you all. We have thank you also for your patience. We have run three minutes of our time. We remain, of course, at your disposal in case you have any questions or you want to have one to one meetings. If something, please send us a message to the to our email.

You have it. So we’re made at at your disposal, and I hope you enjoy the presentation.

Dario Neri, CEO, Filogen Group: Thank you. Bye bye. Bye bye.

Laura Baldi, CFO, Filogen Group: Thank you.

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