Q4 2020 VolitionRX Ltd Earnings & Business Update Conference Call
Good morning, ladies and gentlemen, thank you for standing by welcome to Volition, and Orix Limited's fourth quarter and full year 2020 earnings conference call.
During todays presentation, all parties will be on listen only mode.
Following the presentation on the conference call will be opened for questions. If you have a question. Please press the star key followed by the number one on your Touchtone telephone.
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This conference is being recorded today March eight March 18th 23rd 2021, I'd now like to turn the conference call over to Mr. Scott Powell. Please go ahead Scott.
Thank you and.
And welcome everyone to todays earnings conference call for bullish on Rx limited.
This call will cover Volitions financial and operating results for the fourth quarter and full year of 2020.
Along with a discussion of our recent activities and key upcoming milestones.
Following our prepared remarks, we will open the conference call to a question and answer session.
Also on our call today on.
Mr Cameron Reynolds, President and Chief Executive Officer.
Mr. Terry queues.
And we appointed Chief Financial Officer.
And Dr. Jane Mcauliffe, our Chief Scientific officer.
Before we begin I'd like to remind everyone that some of the information discussed on this conference call will include forward looking statements are covered under the safe Harbor provisions of the private Securities Litigation Reform Act of 1995.
These statements are based on our beliefs as well as assumptions we have used based upon information currently available to us.
Because these statements reflect our current views concerning future events. These statements involve risks uncertainties and assumptions.
Actual future results may vary significantly based on a number of factors that may cause the actual results or events to be materially different from future results performance.
Or achievements expressed or implied by these statements.
We have identified various risk factors associated with our operations and on.
Most recent annual report on form 10-K.
Quarterly reports on form 10-Q and.
And other filings with the Securities and Exchange Commission.
We do not undertake any obligation to update any forward looking statements made during the course of this call.
I'd now like to turn the call over to our President and Chief Executive Officer, Mr. Cameron Reynolds Kevin.
Thank you everyone for joining Volitions conference call Tonight.
We appreciate it and given the busy earnings season.
I would like to stop yet again by recognizing the amazing commitment and hard work site and by all of our team over the past year. During these difficult times I could not be prouder of their efforts.
Despite the Lockdowns, we have managed to keep on main lab and the more operational and opened a new silver one production facility and indeed have made such varied and significant progress and so many areas of the business throughout 2020 and ended the first quarter 2021 and.
And now that we have such a stable reliable reproducible platform technology that we think can and will be highly disruptive and influential worldwide and a wide range of areas.
Before passing over to Terry who will cover the financials and then moving on to our product launches just bringing our annual coal I will start today by briefly discussing our 2020 highlights as a reminder of all the progress we have made and the last year. We book ended this year strongly, especially by closing our acquisition of Optima and January and then by launching off for us.
<unk> products and <unk> cancer screening test in December and.
Lots of exciting milestones in between.
As a reminder, the strategic acquisition of Optima helps secure the supply of one of the key components about and you test it.
The company and <unk>, which we use as the caliber and the.
The transfer of Knowhow is now complete and we now have the capability to manufacture a wide range of these key components in house.
2020 was a pivotal year for <unk>.
It is truly remarkable to reflect that we only reported the proof of concept data in April of last year.
And yet by the Veterinary Cancer Society Conference in October of 2020, we published <unk> study results.
Hosted a key opinion leader roundtable event and by yearend and Youtube that cancer screening test with Texas and this is all I truly fantastic team effort and refocusing on near term product launch opportunities. During the pandemic showed the amazing flexibility about platform and team.
Flexibility is a key aspect of our success.
Throughout the year, we always continuing to strengthen our large intellectual property portfolio with additional patents being granted and new patent applications submitted including in relation to the use of your technology and the ptosis COVID-19, and other diseases and we now hold 64 patents worldwide with a fed that night.
And your patents pending.
We also published and presented at a number of conferences.
Notably and scope.
And <unk> with Baird Abstracts, featuring performance data on our <unk> technology with respect to lung cancer and lung cancer as well as performance data on Youku capture and our virtual markets day, and I'll tell you, Bob we announced our commitment to two blood cancer studies to be conducted in the U S. The first of these studies is a large scale up to one.
<unk> thousand and 500 subjects regulatory study into the five most common types of non Hodgkin's lymphoma.
And secondly, as a proof of concept study for the monitoring of frequent response for the most aggressive NHL cancer.
E L B C O <unk>.
Both studies and now underway with results from the treatment response study expected later in the first half of this year.
And likely the first readout from the NHL regulatory for five 10-K study within the next year.
So we have had an action packed 2020 and have a lot to review from the start of 2021.
Before I go into more details. Please allow me introduce our new Chief Financial Officer, Eric Hughes, who will take you through the key financial results for 2020.
And provide an update on the recent financing transactions that have significantly strengthened our cash position.
Great to have you on board over to you. Thanks.
Thanks, very much Cameron and thank you everyone for joining our earnings call today I look forward to meeting many of you in person when possible.
I'll now provide a summary of the key financial results for the year ended December 31, and 2020, we reported a net loss of $24 million as compared to a net loss of $16 $1 million in the prior year.
This result was predominantly driven by higher research and development spending which increased by $4 $2 million over the prior year period for <unk>.
$14 $5 million and 2020, reflecting the investments, we made and expanding our employee team and securing the supply and manufacturing of key components through the Optimer acquisition as well as higher reset spending directed at COVID-19, and net ptosis.
Despite this higher level of spending we closed out 2020 with cash and cash equivalents of $19 4 million compared with.
Approximately $17 million at the end of 2019.
And to Amp for this during the first quarter of 2021 to date, we have significantly strengthened our balance sheet by adding and aggregates of approximately $25 million and cash through an underwritten public offering of our common stock in February as well as through our aftermarket equity distribution program.
Furthermore, in January we were delighted to announce the award of approximately $4 million and non diluted funding from the Walloon region and the more invest.
We have a long history of support from the agency that they will do and region hearing to date of award installation approximately $13 million and non diluted funding, including this most recent award.
We would like to publicly thank amongst sure Whitney Bourses, Vice President that will live and government and will do and minister for economy, as well as Nicola and Paolo Hay and Rhino <unk> from Nomura and best for the financial assistance and their continued support.
So just to recap before taking into accounts the expense since we have incurred thus far and 2021, our cash and cash equivalents totaled approximately $14 million, which is by far the strongest cash position, we have ever had and the company's history.
Nevertheless, we continue to manage our expenditures carefully.
Our burn rate through the final quarter of 2020 with on average approximately one 5 million per month.
Overall, we would expect this to increase slightly as we make additional investments towards our product launches and expansion of our platform and that.
We'll provide periodic updates on our future earnings calls.
In summary, we're and our strong financial position, providing us both a great runway to achieve our many milestones and continuing flexibility to weather the pandemic and we've.
And I will pass back to Cambrian for further operational and product updates.
Thanks, Derek and I am absolutely delighted to have the strongest balance sheet, we've ever had and great to have you on board and.
In fact, while stroking a new team members and I'd also like to publicly welcome go for it there.
Our new Chief commercial officer to our executive management team as well as congratulate Tom and Michelle break promotion to Chief operating officer, and Dr. Mark Ecclestone and one of our founding scientists.
His promotion to the newly created role of Chief Technology Officer.
And we are transitioning from a research and development company to a commercial company where it's on.
And to strengthen the leadership team with key appointments all for.
For bringing strong global expertise and experience to their respective roles and these appointments aimed to provide a very strong product focus for our management team.
Also from an expansion point of view, we're absolutely thrilled to have opened silver one the production hub for our products and components for close to a lab and Belgium.
Very happy to announce today that we are now producing several of our key competitors and plan to achieve full ISO certification later this year as with our previous real estate transactions. The vast majority of the purchase and fit out costs were supported through non dilutive grants and loans from the EMEA region, again, and helping to keep operating rights relative.
Currently low.
And we're well into the process of reducing at large scale raw materials, such as recovery and nucleus arms, which act as the caliber and on <unk>. In addition to antibodies that are key elements to our branded products.
And indeed will manufacture our food diagnostic kits once finalized we expect to offer all elements for both commercial and Seo and for clinical trial purposes, and CE Mark products for sale in Europe and beyond we're also installing a service lab and the new silver one facility.
Which will undertake sample processing for external parties, including sample processing for nuc event, and Europe more of which I'll discuss later.
The opening of a new silver one facility and he brings the manufacturer of key components in house, thereby securing our supply chain.
But it also should significantly reduce the cost of production of any of these elements and assured and to reduce the cost of future assay development.
It really is an exciting time and I could not be happier that we could find a suitable site. So closely situated to our current lab plus it's another great step forward on our roads for a diverse revenue stream.
Speaking of revenue I was delighted to have appointed our first sales manager and Europe and menu all day milk home, who started with us in December.
And then you roll brings over 25 years of sales experience in the diagnostic field, having worked for companies such as Roche Sanofi and most recently Villa.
He has already proven to be an excellent addition to our team with these folks to help drive revenue for mass silver one facility and.
<unk> has been hard at work generating initial revenues for our products in Europe, and we will update you with the results of is X and work and our next quarterly earnings call in May.
And finally with regards to organizational expansion, we opened a small share of laboratory and California State University and Michaels in the fourth quarter.
This lab is led by Dr. Terry Kelly, Chief Scientific Officer, Volition America, Inc. And focuses on Blue Sky innovation and discovery research.
We hope will help us leap forward on some of our cutting edge research projects.
And so.
Our first products and revenue.
Any of you have followed and support of volition for many many years and know that it has been a long and winding road and so the whole team was especially July to launch our first commercial product and Youtube cancer screening test shortly after a 10 year company anniversary in the fourth quarter of last year.
This was an extremely important milestone for the company as this first launch that we expect to be the first of many demonstrates that our platform has reached a level of reliability and reproducibility and to be launched in a completely independent laboratory.
The test is positioned for use in both the annual health check for older adults those for the seven years and older and for cases, where there's a high suspicious for cancer.
Be a complementary test for younger dogs, a break at high risk for developing cancer and their lifetimes such as Golden Retrievers for test is currently available only from the Texas A&M University with the beta launch focusing on veterinarians across Texas. So what does the beta launch exactly the beta launch is to facilitate real.
Would learning from actual customers and paying for the test to.
To help shape, the marketing mix before we launched nationally across the U S as expected and the next few months.
It also gives us a chance to showcase their products for the large multinational companies. We are in very active discussions with which it concluded successfully would help greatly accelerate launches and sales worldwide.
Given this is our very first commercial launch we are using Texas as the test market to make sure all aspects of our products.
Properly tested what we launched and the U S nationally and worldwide.
And to help us address beforehand and issues with companies, who may end up distributing or licensing our vet products.
We are gaining extremely valuable feedback on key factors such as the logistics of a veterinarian. Taking example shipping processing reporting and interpretation of the results levels of customer service required.
And the feedback and of course, the optimal pricing at all levels.
The team has also done a fantastic job and starting to educate the kols or key opinion leaders the oncology.
Specialists, and GP veterinarians and Texas.
And about nucleoside mix and raising the general awareness of and Youtube cancer screening test in terms of the commercial opportunity and the addressable market. Katherine dogs is widespread it is the leading cause of death in dogs over the age of 10 and there are over 6 million new dog cancer diagnosis in the U S alone each year.
As cancer screening is not as commonplace in the animal health as it is and the human health, we believe blood test like the <unk> screening test could help transform how veterinarians manage cash in companion animals.
Early diagnosis of cancer has the potential to help improve the treatment and quality of life as well as providing valuable additional information to inform the clinical decision making process on <unk>.
You bet cash the screening test is a simple low cost easy to use Elisa based blood test, which we believe will help streamline the screening process for up to one third of bigger agencies and dogs, including common malignancies, such as lymphoma and imaginary sarcoma.
We recognize the desire to receive revenue guidance now that we have had our first commercial product and <unk>.
And to provide this later in the year when the mix of our own launches and licensing of our technology to third parties and both the veterinary and human spaces become clearer.
And suffice to say, we are very happy with how the beta launch is going.
It is providing us with absolutely and valuable information and our very first ever product revenue.
We received the first order for our kits from the GI lab late last year and since then they have reorder kits twice already this year.
In addition to the Texas Beta launch day.
Leverage our global team I'm delighted to say that we are finalizing beta launch planning in both Asia and Europe for a bit because of screening tests and expect a lot of news on these and the next few months.
We're also continuing significant licensing discussions with a well known major players in the vet space around the world.
Look forward to updating you on our progress in the coming months.
We're at the very beginning but we believe that is a fantastic opportunity and we are truly excited to start commercial operations.
Moving on from the vet business to human cancers, where in parallel we're also continuing to make progress.
In January at the world's largest dedicated lung cancer conference Pwc LC and abstract was presented by one of the members of the National Taiwan University team.
The key message from this presentation is that based on an interim analysis of a subset of subjects and their ongoing study.
<unk> could help identify non cancerous nodules, Paul and the scan.
And by reducing unnecessary biopsies by as much as 32%. These results on this subset of the 1200 subject study are very promising and.
No low dose computed tomography E. L. D. C. T is the widely accepted standard for screening of individuals at high risk of lung cancer.
L. D C. T has several limitations, including for specificity, which means high false positives.
Results for this study suggests that neutral zone and his day and Pgm's may discriminate well between non characters benign nodules vs battery at least I'd lung cancers.
Zero stage, one stage two.
In non for many of lung cancer history patients.
The ability to distinguish between cancerous and non cancerous nodules could reduce both unnecessary biopsies and the frequency of radiation exposure from repeated L. D. C T scanning.
Professor Chen the study's principal investigator set at the time of the conference.
To accomplish this result through a noninvasive blood test would be an important step forward in lung cancer screening.
Lung cancer remains the deadliest of all the Kansas and there is a high unmet clinical need for improved diagnosis. We are hopeful that on Youku assays can hope and the likelihood that a world renowned collaborators presented this data and such a prestigious conference.
We share our collaborators and excitement to complete this study and report the findings at scientific conferences later this year and if it continues to go well both for 500 10-K regulatory study in the U S. Like we have in the blood cancers.
We have also made great progress on the research program for the use of our new <unk> technology in the doses and in particular and monitoring disease progression of COVID-19, and sepsis and as announced earlier this week as a potential companion diagnostic for treatment of sepsis and are looking to broaden this further into influenza and <unk>.
The other diseases associated with net ptosis.
On a bit more pallets of this discussion as this is a new and very exciting use if I need new platform and to provide some of the science behind it.
To introduce Dr. Jack Mccarthy, our Chief Scientific Officer.
Thanks, Cameron and good morning, everyone, it's great to be here.
Well on cancer remains on our core disease focus given the relatively recent understanding of the prominent role and with both net and nuclear designs in the pathology of COVID-19, sepsis and many other diseases. We are all set resection and the use of our proprietary technology and diseases with particular regard to net.
<unk>.
In terms of background science white blood cells help protect the body against infection by and golfing invading viruses and bacteria and producing antibodies against them. In addition, why sales and also eject chromatin material out of the sales force neutrophil extra cellular traps on.
Next which cash trap invading viruses.
And our respiratory infections like COVID-19, what cells migrate to the loans, where they produce snacks to track and kill the virus.
This protects the lungs and prevent the virus from spreading to the rest of reported net.
And so therefore, a crucial part of the immune system.
However, overprotection of net fees pathological and.
Weighted levels of net are critical complications of COVID-19, leading to poor patient outcomes and can actually be fatal.
Net for similarly, a complicating factor and a wide variety of other diseases, including respiratory infections.
And pneumonia as well as metabolic diseases autoimmune conditions inflammatory conditions cancer thrombosis strength and sepsis.
P. J could net material is made up of nucleoside.
And Felicia and spent 10 years developing antibodies and assays for new plays and so we are well placed to take a leading role and much of this research and we can detect myths and my new quantities using relations and Q2.
And the same assays and.
Indeed.
I believe our assays for the only analytically validated and quantitative nuclear Xyrem assay is currently available.
We are investigating the use of the new platform to monitor and intense disease progression and treatment response across a wide range for diseases that involve the army for production of banks.
Last year, we shouldnt decrease and level strongly correlated with disease severity and the first wave of COVID-19 patients patients admitted to hospitals and higher levels in patients with moderate disease patients requiring intensive medical support and intensive care units and higher levels of knee presents and patients admitted to regular hospital.
Woods.
And patients who died at even higher levels of nuclear events and patients in intensive care who survived.
We have now conducted studies of serial testing and individual country and 19 patients submitted during the second wave.
And to determine how predictive are tested.
This has taken longer than we expected for hospitals. We are working we have understandably been focused on caring for the very high numbers of patients submitted during the second wave and provide us.
We will announce data from human Covid, 19, and sepsis studies over the coming quarters.
In addition, we are releasing data from an animal study of sepsis. This week and a presentation by Doctor and dress Suwannee, a consultant and critical care on a ccs at one of London's leading teaching hospitals.
This small initial study and looks at the use of <unk> <unk> net staffing to monitor treatment response to a novel therapy to remove <unk> from circulation and a pig model of sepsis.
Resulting in improved physiological and biochemical wellbeing indicators orthopedics and <unk>.
Results showed that the treatment was successful and.
And <unk> assay was the best and most practical way to measure and the next response.
Studies and are progressing through investigate further animal models and the first human trial is already being recruited.
Following the success, we are investigating two for the therapeutic antibody and anti <unk> drugs, both in relation to treatment monitoring and for use as a companion diagnostic for patient selection.
While on the Texas is still a relatively new field population given positive early results. This is shaping up to be potentially a significant new opportunity to utilize our new <unk> platform.
We have formed a new Q next team to provide increased focus and drive to the product development program.
This once again underlines the strong breakfast and Youtube platform technology, which is supported by our broad intellectual property portfolio.
So I think times for sure with further data due to be presented at upcoming conferences and.
And with that I'll hand back for Cameron.
Thanks, a lot and exciting times and date.
And so to the future I.
I would like to reiterate our vision and what makes us so excited with the progress and our space.
Volition is an epigenetics company focusing on advancing the science of epigenetics and exploiting these advances and human and animal health.
This has been on a mission since our founding and and just coming to fruition with on Youtube platform at the very hot debate for genetics.
We believe the lost decade of work out of position with our ever expanding team and epigenetics puts us in an extremely strong position with our expansive odd people fall here to be a significant player in this key field.
Overall on so many fronts with our ever growing team and IP I'm delighted with the progress we are making and I'm excited by the momentum we have developed in the epigenetics failed.
Indeed, our whole team is incredibly excited about the company's future opportunities.
We aim to report throughout 2021 and be on numerous key milestones now that we're in full swing and training our platform into a range of products worldwide. We will focus on driving revenue in the coming quarters, where possible during the pandemic in four key areas.
One <unk> products.
Two disease monitoring tests, such as and Covid and sepsis.
Three using our new production facility to drive reagent sales.
And for licensing of our technology for others to commercialized worldwide in both for human and bit sites.
We also aim to publish data on multiple fronts, including Youtube capture which I have not discussed at length today, but it is also making very strong progress.
I along with the rest of the board.
And indeed, the whole company moving forward to sharing the results of case studies over the coming months and years with our optimized platform.
Despite the pandemic 2020 proved to be on most exciting year, yet thanks to our fantastic hardworking team.
And we hope for 2021 Ken topic.
Thanks again for joining the call today I very much appreciate it given the busy earnings call season.
We're happy to take questions.
Operator.
Thank you.
At this time, we'll be conducting a question and answer session.
And if you'd like to ask a question. Please press star one on your telephone keypad and a confirmation tone will indicate your line is and the question queue.
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One of them please poll for questions.
Thank you and our first question is from the line of Kyle mixing with Cantor Fitzgerald. Please proceed with your question.
Hey, guys. Thanks for taking the questions and congrats on all the progress achieved this year and trade. The same just regarding the on intelligence trial that you are still negotiating and signed a few questions around that so first is the intention to conduct the trial and that kind of looks at all or maybe for some of those diseases like COVID-19 to pull and sepsis.
And just one be examined and the trial and then second is it possible that the trial could assess.
Treating monitoring and intelligence based therapeutic antibody drug and Sino Jake mentioned this on and there's a few that you guys are looking at I was wondering if that's a simple application in the trial and then finally when you say on like a large trial I noticed that and that in the press release does that mean and what the size of the blood cancer study and the U S.
Yes.
Hi, and thanks, Thanks for your support and some very good questions I'll answer those briefly myself and then see if Jay has anything to add.
So yeah of course.
The first question and really I guess pertains to whether we do a separate and the ptosis trial for Covid for influenza and sepsis.
We have been and discussions on one for influenza and Covid.
I think given where we are we're probably more focus now on having one for <unk> because it's a very very and I think as you know, it's what most people and hospitals, obviously would be applicable if it works and sepsis, it and will almost certainly work and the others.
But influenza and Covid the numbers, obviously, you got up and down and that sort of overwhelmed hospitals at the moment. So we are in the U S. We're looking to do a large trial, which is the third question.
It would be about the same cost, we'd expect and as the other 510, guys, but when you're doing longitudinal samples, which this would probably be you have a probably a similar number of samples, but less patients if that makes sense.
Because you're looking to get for a five samples from each patient so.
It would be a very similar scale of trial and the exact numbers you need for longitudinal study.
Still working on but I think we'll end up with a product for them and <unk>, which will work in Texas, We expect and hope we'll see how it goes but that's all the things we've seen now are extremely encouraging.
So and that would be useful for all three so we're just debating at the moment.
Whether the first capital for rank if you will we'd go for a one on on.
For influenza and Covid or whether we would look to do one and sepsis, but substances are probably the big market. That's obviously going to continue for a long long time, given it's such an endemic issue.
And as far as the drugs we can.
So we're looking at several therapies I believe I can confirm this but the the trial for the drugs would be a separate one because obviously that's.
It's not diagnostic low prognostic or disease progression. This would actually be the companion diagnostic. So as you are as you saw we had fantastic data with Suntrust has our assays worked spectacularly well and by far the best and of course, our assays are always routine and low cost easy to use so I think we have tremendous advantage.
Are there any options.
And the trials would be different from the other ones for sepsis and COVID-19 because that would be the diagnostic ones, but I think we would look to certainly the proof of concept studies on the you are correct that the sand.
This method of therapies and we're also looking at some potential drugs and proteins.
And that can also be useful so we could probably package those together and you know a proof of concept study, where we're testing several of those at the same time.
But I'd imagine the actual therapy trial would have to be something separate because it's a companion diagnostic to the therapy, but I think.
And Jay can confirm all of this but it's incredibly exciting to be at the heart of all of this as well as cancer and the vet space Jack did I get that right anything like to win.
No I think I think you've got it pretty much all of it.
Net.
Background is Scott.
The way the next behave.
And is similar and all of these diseases.
So you could in principle has.
Diagnostic for net in the beginning we are looking at for diseases, all of that piece going very well.
And probably as Kevin and shows at the beginning it will be.
Sepsis for Covid.
Later on we might be able to book actually.
And Tennessee.
And indication itself.
And I think it's important to just reiterate it has taken some time, we were hoping for some day late last year, but as we said a few times its very understandable that.
Some of the trials longitudinal studies have been tough during the when I went on.
Emergency Ward is overwhelmed taking 10 samples from one patient is not their top priority.
And quite rightly, but I Couldnt express strongly.
Two strongly how happy you are with the results and how our collaborators are really appreciating not just how well the data is coming out but also how well our assets perform all the work we've done and now means we can ship kits to a range of places where that can be run and they are just working tremendously well and doing what they should be doing.
And also just being robust and reproducible and reliable. So I think we put ourselves in a really good position and we will have a lot more updates on this throughout the next month or two and through the quarters, but.
And I think there's going to be a big part and what about for key pillars of the company going forward because and.
Net is oney recently understood, but I think we can be really at the heart of the treatment as well as did our diagnostic prognostic and and disease progression and metastasis as well.
Okay that was great. Thanks, so much Cameron and <unk> that was an excellent and really comprehensive answer there.
And I just wanted to switch to that.
And in fact cancer screening product on the beta launch and Asia, and Europe really encouraging.
And to hear you guys kind of wondering on turning to those markets, obviously pretty large I know, it's still pretty early on obviously, what's the general plan with Viacom with marketing and distribution and you already have relationships with some that's I guess in Asia and Europe, maybe similar to what you have in the U S with Texas A&M and then again another difficult question to kind of answer at this time.
But one can and launch maybe occurred is that more a 2022 event or could that possibly happen and the back end of this year.
Yes.
Very good question. So yes, we've actually obviously you got a strong footprint in Europe and in Asia.
And we're very hopeful it'll be this year and actually it could be reasonably soon because where we were doing a lot of work on this we'd like to debate on the same lessons, we're learning and the U S. We can use a lot of them, obviously and different markets, but every market is a bit different.
And quite advanced discussions and either and restarting and Singapore, because thats, where we are and you can learn a lot of lessons and a place like this.
Singapore, and then use that for other markets.
So I would expect that and in the short to medium term.
In Europe, we're actually very active active as well and looking perhaps for slightly different model, we've been shipping kits to Texas Gi lab, but we actually have our own lab in Belgium, now I assume for one.
Mr <unk>.
So one option, we're exploring very seriously is actually that becoming the equivalent of the lab.
And in Texas. So then we could be running the samples as well and Thats for that way. We can also because it's right in and out of Europe, It's easy place to ship to obviously bedrooms.
Well located and we are the best and running the test ourselves. So I think that the three main ways of generating revenue from the vet space. We're actively looking at after this year.
Kit sales like we are with Texas and currently.
And then running it as a service I think there's a very strong chance, we'll have that running and kind of the medium term.
This year in Belgium, and we're looking and and in Singapore as well, having a lab, where we we run the tests the contracted out when we set up ourselves.
And also I think we really should emphasize.
What what the beta launch has also given us apart from all the learnings is very much the attention of the big companies as well you've taken much more seriously when you run the product yourself you show it works.
We're not testing the product and product is what absolutely perfectly we're testing new marketing and logistics and all of those lessons are very hopeful for the bigger companies as well.
And what I mentioned the names on the Covid, but then there are two big companies and were in very active discussions with both for different reasons and that could really turbocharged. The revenue. If we ended up doing something we could accept with them and they each have hundreds and hundreds of salespeople throughout the U S and worldwide.
I think it's very fair to say I'd be I'd be upset if we didn't you say is it possible for this year I'd be very upset if they both werent launched this year and perhaps sort of most sooner rather than later for at least one of them and that will be a mix of all three.
And what our platform really allows us to do is all three we can sell kits. We can do it as a service and we can license just direct out but still selling out key components and I would expect we'll try to have a strong component worldwide. So yes.
This has been happening below the surface and obviously, we can't say anything until beyond that until it actually happens, but I would expect to see a lot of progress on all these fronts. This year and the debate of testing has been that the beta launch and all the testing and we've been doing has been completely and valuable.
And so we still.
And what we've said before it's a market that could absolutely.
Change the way volition is seen and then generate a lot of revenue. So we're taking it very seriously and you'll see a lot more news on that and the coming months and quarters.
Did that answer your question from it.
Yes, I think on this great. Thanks, a lot for that Cameron.
Just one last question for me similar line of thought maybe on the expansion and the U S within that test.
So I.
And I guess, how are you evaluating some of the markets that you want to expand into and like what you are evaluating marketing mix I guess right so what and.
And what have you seen so far with respect to how different marketing channels are.
And how they're responding or what the feedback has been to.
Your efforts, thus far and.
And yet just how are you thinking about the fashion and from the U S and what I don't know what can we expect maybe over the next few months or so just on just broad high level and kind of comments would be awesome. Thank you.
Yeah, absolutely. So we're looking now obviously the OLED key lessons pertain to we wanted to get right before we go internationally and they sound boring and and things, but the logistics are very important whether adult we've had feedback that less fasting is best for us. We're doing tests now to see if we can bring that down from eight hours to four hours and it's not it doesn't have to be overnight.
Whether you can ship with testing and also just overnight on ice Robyn and freezing all these kind of things are big for us.
Our marketing mix looks like actually I think dependent on whether we do end up doing a deal with either or both of the major players.
Because if it were part.
Part of doing a deal with one of the major players, particularly in the west that would really leaning to the public awareness and the marketing so obviously.
Anything like that would be a much bigger market, we'd get a slightly smaller share of and of course or but.
And would you would do that because it would greatly.
The only reason we.
The only way we do it is if they are really leaning into the sales and marketing and as well so we're working through.
All of that ourselves and obviously, if we do not do a deal with a major player and the rest and we'll do a lot more marketing and and facilities and the process. If we do we'll end up doing less.
And that will become obvious and that mix as we.
Finish off the beta launch and then workout what licensing and all marketing, we're going to be doing for larger companies. So I would expect to have that sorted out and the next quarter or two and then that mix was how well going forward.
Okay. That's really helpful. Thanks, a lot and so on.
And I'll leave it there, but again guys. Congrats on all this progress looking forward to the updates coming out.
Thank you.
The next question is from the line of Jason Mccarthy with Maxim Group. Please proceed with your question.
Sorry about that I was on.
This is Michael and what's on the line. Thanks for taking the question.
And I would like to gauge.
Just on the.
On the size of those Texas, A&M or because you mentioned that there were three additional in 2021.
And where those based on the demand and they're seeing or were they more expected as <unk> scales up their supply for the launch.
Oh, it's completely based on demand. So they are you see from the accounts. It was just a little over $7000, which equates to four kits, which if they used every place.
And because they have to do some repeats and things, but that's about 161.
We're making the revenue from 160, <unk>, if that makes sense and actually you probably noticed and descriptive was too and then I said three because they just reordered a few days ago and there was some time between the recording so when they run out and they order more basically.
So that's I mean this is about the revenue of course, but it's about the learning from the from the beta launch as well, but it's very nice to have all these things being sorted out which we thought the best way to really literally things is to actually have real paying customers, there's dozens of vet subordinate and <unk>.
Texas, A&M and giving us great feedback just on the actual running of the test themselves and as I said the actual test is working absolutely perfectly. This is all the marketing and the packaging and all those kind of things, but yeah. So the audit and 7000, which is enough for 160 dogs and they've rewarded with two times last week and out three times.
And they just keep reordering on a batch once day I guess, you will adjust and so I'm wondering.
And as they as they finish the previous one so thats exactly in line with where we thought that would be we haven't obviously done a low to marketing where we.
And we've done a bits and pieces with the key opinion leaders and throughout Texas, but obviously nothing nationally.
So this is the kind of the level, we're expecting and it's been absolutely great from the feedback point of view and I think it's really.
Helped us sharpen our pencil for the.
International and National launch and also.
Again, I think it's really focus the mind on the big companies that.
And with the trains moving if they want to get a board everybody get aboard I think if we'd not.
And not launched I think that would be locked it wasn't the same level of interest before we launched it there is now.
Because at the moment, we have a monopoly and the space. There is absolutely nothing else out there and the cancer space and the vet market. So I think we're in an excellent position, but if we can work out a deal with one of the majors I think we'd be very good for us and good for them, but if for any reason we don't.
And we've shown the ability we can launch ourselves. So I think it's been on absolutely when we know and round.
Okay. Thank you and then I'd also like to ask about.
Net ptosis, specifically and the ptosis outside of COVID-19, because I mean, you really need a bit of a crystal ball to determine where the pandemic is going so and so what's the size of the opportunity for.
For other net associated diseases, and in terms of something like stepsister influenza or any of the other ones.
I'll, let Jack answer that for more technical point of view, but I think.
My non technical word would be absolutely massive bigger than cancer sepsis is the biggest killer and in hospitals and it tends to kill you because you don't know what's coming and also there's very few actual therapies for it.
So we're working with a range of groups, who have been working on therapy for a while and the.
Spotlight from that.
From Covid from the doses for certainly allowed them to really progress flex interest their therapies. So I think it's potentially.
And as big or bigger than the other things. We do why is that sepsis and said, it's very hard to actually know you measure the net and the advancement and disease progression, it's very hard to known prognostic and it's very hard to treat at the moment.
And part of the treatment issue is if there is nothing good as a companion diagnostic and then it's very hard to have a treatment because you can't monitor the first thing you brought on and I always have too many net because as Jay.
Points out a lot the net theyre actually very good for you and until they're not so you don't Wanna be removing someone's primary defense mechanism unless it's really in excess so I think for all those reasons, our assay has and the evidence we've shown recently and and a range of different studies.
Always works extremely well in the diagnostic disease monitoring and disease progression and were hopeful from what we've seen and also from prognostic.
So well.
Well, that's not a scientific term massive but we're working through that now but it could be.
Something which you would give a lot to everyone who comes into hospital because if it's as you said creeps up on you and you can kill you very quickly knowing that it's the net net to building up would be incredibly useful and I think we've certainly got a solution and it certainly low cost easy to use.
And so I think we could be big part of it Jay do you want to answer that slightly more scientifically perhaps.
Yes, Hi, Jason.
Well first of all net net is a huge area and it's not.
It's not just kind of income.
I think if you took.
Talking to people working and and think you can in Covid.
And then now completely.
And im talking about and that's all the time on net.
Explosion and subject.
And in medicine, and talking to people in and intensive care.
On the tree my conversations that we like.
If you talk to Cooper and I'll speak.
Got it nobody would've heard net clinicians and.
And now everybody is talking about mix and.
Okay Covid has really.
And one cannot and the world to connect and Brandon and then.
And all sorts of diseases, and Carlos and Jan.
So net.
Apart from.
Actually it's not it's not just on climate.
<unk> mentioned net.
And what drives the pathology and sepsis.
And perhaps this is the biggest.
Kimberly and hospitals worldwide and so these interest example.
These and all sorts of Andy and Disney.
Hi, Bob on <unk>, but the underlying slides and.
Factor.
And one of the main glad and factors.
Alright.
And.
Lot of people.
Excellent dark on basis.
On basis is what actually.
And in Q1 net.
Drives thrombosis and might come from basis.
And net drives and knock on wood.
Oh right right.
And London Blockages net strives.
A lot of the applications that occur.
Diabetes currencies.
And all sorts of varieties and pharma and diseases.
The actual very bad symptoms when and when these diseases.
And so whilst co greed highs.
And Sean on lines, if you like on that simple.
And everybody away.
Actually they have on tap a much wider low.
And how do you think is shown on line.
Cause.
Such a high mortality rate.
And India.
With net Sean.
On a lot on problem, which is much wider than that.
And we've opened a net on.
Net division.
Within the company.
Thank you for vantage and that situation.
And Turkey.
<unk>.
Hopefully temporary opportunity.
On the opportunity.
Okay.
Thank you Jack.
Got it.
Couldnt, possibly bigger and I'm sorry, thanks Jay.
I was just going to say I really appreciate the thorough and one more quick one if you don't mind, one and ask about the proof of concept study and <unk>, how does the trial design and compare to the to the larger regulatory study at least for that <unk> and cannot be used.
And our potentially as a read through for that first data readout and potential filing and blood cancers.
Yes, actually thats, probably a question for Jason Who's our expert on that could I could I have been calling.
And on the if we have a call afterwards.
He is an expert and normally they don't want to make any answers, which perhaps could be incorrect.
Unless you would know that J code should we leave that to Jason.
No I think it's better choice and answers that.
Sure Jason It's organized all these trials and he's been a huge amount of effort studying all the different types of and I joke. So it's probably better if I don't go on peace and try and answer it.
And if that's okay.
And there's no problem I'll talk to you on later, thank you for taking my questions.
Thank you.
Next question is coming from the line of Nathan Weinstein with Aegis capital. Please proceed with your questions.
Hey, good morning, and thanks, so much for taking my questions.
Maybe just flipping back to <unk>.
And every market and on the beta launch going on and <unk>.
You shared some of the feedback and obviously discuss some of the revenue opportunities, but maybe you could just I've been a little more on the color you are hearing from the veterinarians and certainly on any anecdotal feedback that youre getting.
Yes, I think obviously, there's a lot of things have been learning some of the feedback on the on the fasting going for smaller fasting is very helpful.
Shipping, we're looking to perhaps have provide packaging for them to make it easy for them also while we're also talking to the big partners. If they could just drop it into our envelope with all the other blood tests that would be easy for them and shipping it to a separate lab.
But.
I think as we've talked about there's absolutely nothing else out there.
So it's been a lot of education as well and there's a lot of discussion whether its a cancer test.
And you're sick dog or what I think is more likely and it's actually.
And the biggest marketable and its.
Were you testing partners at part of the wellness tests for dogs, I think you know a large percentage of dogs and U S. GAAP.
Our wellness tests every year and I think that's where we'll end up.
Positioning ourselves, but that's that's all and the protests now and.
And so there's been a lot of work also theres been a lot of interest in it.
Treatment monitoring I think you remember Heather presented a small amount of data showing that it worked very well for that as well and there are millions of cases of these cancers every year and the current methods of monitoring and treatment are a very average at best So there's been a lot of feedback that that would be very very useful.
We've also been working with.
And we said we've been in discussions with some of the bigger companies where it is.
<unk> pricing quite quite heavily to them.
And what would what would the discounting and price mean for extra South I mean, our ambition is to have millions of tests sold per year at what kind of price point, and obviously you don't want to sell it cheaper than we need to but also we'd like to have it was widely accepted as easy as possible. So we're just looking through that at the moment and trying to work with our own.
And in Texas, and our own feedback as well as with some other groups. If they were to work with us launching the.
The optimum pricing would be to really.
Our aim and all this has not to be made not to have a small number of tests at a high value, but try to make it really really widely adopted.
So yes, the price it would be the big discussion and all the logistics and also there's been a lot of feedback on the monitoring of treatment for these cancers would be very very useful. So that's probably the next product off the rank.
<unk> should be in the short to medium term as well and I think that would also be very very well accepted so it's a whole range of things and there's quite a lot of things and mixed there, but I'd like to reiterate when we say beta testing, it's not the actual product itself that has worked incredibly well it's doing exactly what it should be doing to vary all the feedback not just in the vet space.
But all the human space when we've shifted to a very wide range of groups. They're all incredibly impressed of the analytical validity, it's measuring and exactly what it should be doing its very reproducible and very robust. So the rest is all the product launch things we're learning.
And does that make sense.
Yes, that's great. Thank you camera and for covering that and Melissa and overall, it's been a really nice engine of innovation across all the areas and human bed and the work that Jake and the rest of your team is doing it's really quite exciting to watch and then I guess just sticking with the theme of net here and when we think about like on the learning that youre getting from from different beta.
Do you think you have and will build out the product portfolio and that and have some more products and adjacent areas within the animal health space.
Oh, absolutely undoubtedly so I think the easiest ones to launch next and with the feedback we've been listening is on the monitoring of disease treatment and monitoring.
And that's something which is quite easy to do with what we have and we've had some very encouraging data and not enough to luxury products.
But that's something Heather is collecting now so we're hopeful we can really broaden that out and the kind of shortly and the next few quarters as well obviously there are other cancers.
And which we're working on and as we've discussed before the incredibly exciting and you think about what we do is the nucleus items and not just preserve between human and dogs, but every species. So.
The big companies that are trying to get a cat and notoriously quickly and coming and divert offices. So they're trying to find reasons to get cat owners and into.
And to the vet and as well and so I think there is potentially a big market in the cat market for and it's obviously from all the things we've seen that the nuclear side was and not just cancer and that can be a lot of other things as well. So I think this is the starting gun on the finishing line and the range of products. We can launch and I think also I mentioned it briefly but we're also looking.
Greatly strengthen the team and the vet side too we've been doing it with the bullish and team, but we really want and commercial focus from the vet space, So expect to see and the short term.
And some key hires to really drive that.
And as a separate and distinct within evolution, but as a separate entity and.
That would help us to really expand not only internationally I think the Asian and European launches and something we'll be doing and the short to medium term as well and I think we will not just go to dogs, but a range of other species and not this year, but in the coming years because it is exactly the same platform. It just comes down to some slot adaptations certainly between humans and dogs and.
We'd expect the same for cats and then he can go into veterinary animals and the larger animals.
So I think it's going to be a very big story.
Thanks, Kamran as a dog owner and I am glad you started with dogs and that with cats and I appreciate the color there.
[laughter].
Thank you and any other questions.
And yes. Our final question is coming from Bruce Jackson from Benchmark Company. Please proceed with your questions.
Thank you Hi, Kamran.
<unk> deeper and acute capture.
Touched on the <unk> capture program and I, just wondered if you could maybe give us some highlights and.
And next data reads can be on the circulating tumor cell program.
Yes actually go and thank you that was we didn't put it in this COVID-19 because obviously, it's a lot happening. So again, we were focusing on the product launches and and and everything else for doing so we've taken on a small team and the U S.
Why in California, and Thats, where the hub is a lot of epigenetics is so to get the best people.
We thought a small team they're doing a lot of it would be very helpful. So just a quick read.
A recap of where we are.
This is something also we have the full pillars, we always talk about the vet and pillar, one and pillar well one of the pillars, the human cancers and the doses on the three pillars apart from capture.
So we showed last year that we could separate long from short nuclear zones and what it is from just for everyone else's benefit is now that the antibodies are on a magnetic bead.
You can pull out the nuclear to be analyzed. So once you have the nucleoside and you also have the DNA and we showed we could separate and loan from the short DNA, who cares why is that interesting to short DNA has been shown to be with the cancer DNA and nuclear same zone, so and potentially a fantastic, enabling technology for everything and liquid biopsy space.
Once you also have the nucleosome you also can do mass spectrometry and actually that's gone very very well and we've been working with our collaborators and there's a paper and in the offering on and showing how all that works as well and that's also potentially at surface.
And a group that can actually dual list and domestic dromedary, so again and part of the revenue and looking to do is things through servicing from silver. One. This is another source of and so from the actual concentration of the nucleosome side.
We did it but like anything we've done before.
And sometimes it works better than others. So we realized we kind of principles on driving forward and we went through a re optimization process like we've done for the assays like we've done and everything we've done. So we went back and just pulled on a part to make sure everything was fully optimized from the coding and debates too.
Actually using the antibodies, which can actually be mass produced all the things that would need to be a product and the service. So that's gone very very well, we will have a lot more data on that coming to the the final stages of the price of that from the sequencing side. The mass spec is actually looking very good and that's already and publication and ready So I think.
That's something we'll have news on certainly this year and hopefully sooner rather than later this year.
On the key aspects of it which is and the three key aspects. There is the sequencing side, there's domestic geometry side and then there's the other transition transcription factors and I think the team has done an excellent job at optimizing low lows. It's one thing to have showing something works, it's quite another to have it ready for products. So that's what they've been doing.
And I think they've done an excellent job Jake is that Tim how are you Sir.
Yeah, Thanks for all of that or is that spot on and and.
Net.
And you guys and California.
Strides towards.
Changing it from being something that that's.
Clearly and Ken what to something that does what every time.
Does that answer your question Bruce.
It does congratulations on all the progress and thanks for taking my question.
Thank you anytime.
Thank you and gentlemen, I'm going to turn and briefly over to Scott He is from.
He and search.
From and answered his and answer for you go ahead Scott.
Oh, Hi, guys just regarding Michael's question earlier, I, just heard back from Jason Terrell.
About the blood cancer study.
From Michael.
Yes.
And Michael to answer your question from earlier I'm going to quote from Jason.
And the.
D C. Bcl POC study is a treatment response monitoring test, whereas the larger 1005 hundred study as an aid to diagnosis of the disease. So the readouts are not related.
We also hope to have the treatment response data in the coming months as the study has almost been completed.
And that answers your question Michael.
Thank you I'll turn the call back to Cameron for closing remarks.
Thanks, everyone.
And a lot going on it's been a very interesting year for everyone and I'm sure. We're all adapting to working from home, but I think from everything we've done and everything we have been we've had a fantastic year.
Not only and the capital raising side, but also the product side development side the team.
It's all worked out incredibly well and I think this is just going to be an absolutely fabulous year.
And a real pleasure of working with the team that we've managed to go to is done with and the next few quarters and I think we're just going to be picking up speed and we're going to be focused as much as recapped on making sure all.
The green shoots of revenue and all the different areas, we continue to grow and.
And we make the company or a low to very revenue streams and and also very exciting research and development at the heart of epigenetics.
Thank you for your time.
Thank you. This will conclude today's conference you may disconnect. Your lines at this time and we thank you for your participation.