Q4 2021 Gbs Inc Earnings Call
Reading them and welcome to the GBS incorporated fourth quarter 2021 earnings conference call.
Currently all participants are on the listen only mode. A question and answer session will follow the formal presentation.
If anyone should require operator assistance during the conference. Please press star zero on your telephone keypad as a reminder of this conference is being recorded.
It is now my pleasure to ensure introduce your host Alex Argento Investor Relations for GBS. Thank you you may begin.
Thank you and good afternoon, joining us today from the company are Harry So many of this president and CEO and Spiro <unk> Chief Financial Officer, a press release announcing the results on the update was issued this afternoon and is available now on the GBS website.
I will now read the Companys Safe Harbor statement. Some other statements on this conference call are forward looking statements within the meaning of section 27 day of the Securities Act of 1933 section 21 E.
Of the Securities Exchange Act of 1934, and private Securities Litigation Reform Act of 1995, which involves risks and uncertainties forward looking statements. On this call include without limitation <unk> ability to develop and commercialize the diagnostic test realized commercial benefit from its partnerships and collaborations and secure.
Vitoria approvals among others, although GBS believes that the expectations reflected in such forward looking statements are reasonable as of the day made expectations may prove to have been materially different from the results expressed or implied by such forward looking statements.
GBS has attempted to identify forward looking statements by terminology, including believes estimates anticipates expects plans projects intends potential may could might well should approximately or other words that convey uncertainty of future events or outcomes to identify the.
Forward looking statements.
These statements are only predictions and involve known and unknown risks uncertainties and other factors, including the Companys public filings filed with the Securities and Exchange Commission.
Any forward looking statements contained in the press release speak only as of its day, we undertake no obligation to update any forward looking statements contained in this release to reflect the events or circumstances occurring after the state or to reflect the occurrence of unanticipated events.
During this conference call of the company may refer to EBITDA, a non-GAAP measure EBITDA is not and should not be considered an alternative to net income loss income loss from operations or any other measure for determining the operating performance EBITDA is normally calculated by adding back income tax depreciation and amortization to net income loss I would like to now turn the floor over the hair.
President and CEO of GBS Harry Please go ahead.
Thank you Alex good afternoon, and thank you for joining us all of them have reportedly business and financial update call today.
We issued our fourth quarter and full year 2021 financial and operating results after the close of market today.
And I hope you've been able to review the.
GBS is focused on developing and commercializing innovative bison shuffle of point of care monitoring and diagnostic tests.
We leveraged the priority technologies, which allow saliva based testing approaches to be as accurate and all of the food based methods such as serum blood or urine.
We believe offering patients a convenient low cost and disposable Pitt Street.
It's more of the piece of garden, well low compliance and frequency of testing to reach new levels in the developed economies.
GBS, whose goal is to have our technology readily available to both patients and physicians at an affordable price.
That will be comparable to what is on the market today.
We have identified the Hamlin 30 additional diagnostic tests in due time, we anticipate on technology will have broad applications of course different diagnostic modalities, enabling diagnostic tests, such as clinical chemistry immunology Chin the market allergens.
And endocrinology.
The bus into the technology was developed at the University of Newcastle Australia.
And was acquired by life Sciences boyfriend diagnostic proprietary limited the.
The technology was then the license to GBS for the Asia Pacific region.
And that has been on the continuous development with J D S.
So the news.
The bias into ease of platform technology, which uses proprietary organic the on trade.
Transistor technology.
Which is patent protected to the.
The 2033.
Currently we are advancing two lead product candidates towards commercialization.
The flagship product candidate is a novel the library of glucose policies and cash.
Indian point of care tests.
Expect it to substitute in the basin.
Get perky blood glucose monitoring for patients living with diabetes.
And second of July the Sars Covid, two antibody candidate, which will provide real time want to pay the detection of sounds kind of the two borrowers antibodies.
With respect to out of glucose by since the technology for patients living with diabetes. We believe that this will have the ability to make blood based testing.
Testing obsolete.
When you look at patient preference as we have done extensively throughout a patient's day, but that's the London based glucose Bisons zone that is pain free non in basin.
On to use and convenient is the.
It would make the when compared to the current blood testing mechanism.
The book Tonight.
Unfortunately, they have been little to no recent advancement of orientation for people living with diabetes.
And this is where we see the very attractive opportunity.
Yeah.
Diabetes is a global epidemic and the disease is growing rapidly with the market estimated to exceed 465 million people and we expect to grow to 700 million by the year 'twenty 45.
Our commercial license applies to the world's largest on any of these population the Asia Pacific region.
This is the market the GBS will be of dressing to bringing on board noninvasive real time point of care of diagnostic tests to people living with diabetes.
Rapidly rising rates of diabetes are being seen in the APAC region and according to the latest startup more than 100 of 70 million people living with diabetes representing the.
Right.
All of the world's total population of people living with diabetes.
Given what we believe of the superior analytical characteristics of the bison technology on the current development stage. It was important the GBS with its global license agreement joined the international effort.
But the COVID-19 pandemic with its first class technology.
In 2020 as the.
The emergence of COVID-19 infections began to sky rocket exponentially.
GBS decided to expedite our collaboration with the waste Institute of biologically in spite of engineering at Harvard University.
In order to develop a more accurate and real time Sars Covid antibody testing the support both the international explanation of ethics and testing.
Yeah.
This past quarter and indeed the year.
One of the challenges and opportunities as COVID-19 has become a focal point across the global healthcare industry.
And the good part, although the daily lives.
Today as we learn more about the developed on variance we must all recognized the COVID-19 is not going to be around the kind of as easily and we must remain vigilant.
The recent reports from the World Health organization and CDC indicate this new strength is more contagious and can allow people already vaccinated to transmit the virus.
Well these developments are unfortunate on.
On so many levels. It is important but we as a society now on the standard the importance of Covid testing and how we can implement these tools in that lives. So we can better prepared well in the future pandemics that the rights.
GBS, we are proud to be joining the efforts to enhance health care diagnostics, but providing convenient and accurate antibody testing.
The long term efficacy.
Next the nations have yet to be demonstrated clinically.
Turning to the GBS is fourth quarter and full year financial results, which I'll see if I sort of secures will discuss in greater detail shortly.
[noise] represented another solid period for a NASDAQ listed company is creating the awareness of course of medical and then basically communities.
Briefly I just like the highlight a couple of financial reports the stop.
In December 2020, we went public my initial public offering and raised $21.6 million and gross proceedings and listed on the NASDAQ Global stock markets.
Proceeds from the sort of night and see what can be utilized to obtain regulatory approvals pipeline advancements.
Marketing and establishing a distribution network in addition to working capital.
And most recently GBS was awarded the grant of $4.7 million from the Australian government. The fund the Buildout of our high take by center of manufacturing facility.
This recognition goes beyond just the value of the grant.
As by sense of platform technology was identified by the Australian government as one of the on the.
National manufacturing priorities under the H modern manufacturing strategy.
The facility will be solely focused on advancing GBS just products.
Yes.
We continue to be fiscally responsible and have multiple tools and strategies to extend our cash runway through sublicensee and collaborations which have been provided as a diverse set of financial and the opportunities to the company.
Now, let's review some of our rich and key highlights.
Our core focus remains on the product development on both of US a lot of glucose.
It's a lot of the Sars COVID-19 two antibody tests.
In February of this year, we announced the execution of a sponsored research agreement with Johns Hopkins Bloomberg School of public health to accelerate the development of this of lie the collection protocols.
The London based diagnostic test.
This collaboration close together resources from John Hopkins, and bar of mental health and engineering as well as at the school of public health and the labs, the library of Biomarkers and the pixel disease programs.
In February of GBS also announced its collaboration with the waste Institute of biologically Inspite of engineering at how the University to develop a COVID-19 antibody test.
Subsequently to integrate the waste Institute the rapid eight technology with GBS is proprietary trend just a sense of technology.
Later in the spring we received approval from Harbin Longwood Campus Institute the board should commence the validation study to test clinical samples from the COVID-19.
Part of the tree.
In order to advance these assets into commercialization phase as effectively as possible.
Management has preemptively executed certain priorities to ready the company post an approval.
In June GBS completed global voice of customer survey.
On people living with diabetes.
The verified the desirability discuss the applications in the daily life and review of the product features all makes a lot of the glucose box zone.
The findings were.
In all markets non out of 10 patients responded positively to our buyers since the platform.
Seven out of 10 patients were seriously interested in purchasing the product when it is released.
And three out of the Penn wanted to be placed on the pre order widening list ahead of the product the release.
Finally, more patients in the U S indicate the price on the pain free alternative to current glucose monitoring will play a role in determining the decision to purchase of new device patients in China indicated price wasn't all of an issue.
As long as of the product was accurate and reliable.
Most recently, we engaged with the L E K consulting to the.
The labor a shortlist of suitable commercial partners for distribution in China.
As we prepare for the initial discussion with potential collaborators in this region.
On behalf of GBS of senior management team I want to express our gratitude to all of our employees for their perseverance and dedication to the company in these challenging times.
Our continued grit and perseverance can bring of shifts to the point of care diagnostic industry.
As the affordable simple on the base testing, one day deliver a more accurate and convenient way to conduct accurate testing.
GBS is goal is to a lineup of tests to our patients' needs by providing an affordable non invasive tests at point of care.
And then easy and administered the test strip.
We can empower patients to test easily.
Safely the multiple indications.
Yeah.
We have made important advancements across the organization in 2021, and we are confident in both of our development and commercial approach.
As well as our ability to execute on the year ahead.
With these insights I would like to now turn and call ever outside of those thorough securities for a more detailed review of the 2021 financials.
Spirit.
Thanks, Harry as Harry mentioned 2021 was an impressive array of advancement and development of GBS is bias since the base point of care of tests, but all sorts of GBS is the granting of organization of the U N.
On the June 30, 2021 the company had a preliminary net loss of $8.5 million or 68 cents per share compared the net losses of $3.3 million of 37 cents per share of the same period last year.
This is predominantly due to the acceleration in the development of the commercialization expenditure.
In December of 'twenty 20 of the company closed since the IPO and generated approximately 19.7 million net cash of price age.
Government support income was 578000 for the three months ended June 32021, and zero for the same period in 2020, respectively.
The company said on the path from the RPI to utilize the K resources and commercial partners to advance the projects towards commercializing.
To achieve this acceleration of the expenditures as required with the major categories thing development and commercialization of the financial view of the three point million compared to the prior of 0.6 of them again and employee benefits expense of $1.7 million compared to.
The price of $1.1 billion.
As of June 30, 2021 of the company's cash cash.
Cash equivalents and marketable securities totaled approximately $12.7 million compared to approximately 430000 on June 32020.
As of June 30, 2021 the company had 12.4 million shares outstanding.
Management continues to be fiscally responsible and has multiple tools and strategies to extend its run away true sublicense of grain limbs and collaborations we should provide a diverse set of funding options to the company.
GBS is of the view that the current operating plan and financial resources, its cash cash equivalents and marketable securities as of June 30, 2021 will be sufficient to cover the expenses and capital requirements into the fourth calendar quarter of 'twenty 'twenty two.
I'll now turn it back the Harry for the closing remarks.
Thank you Spiro.
Spirit made it clear we are very proud of our accomplishments we have made this year.
Heading into fiscal year 2022, we anticipate benefiting from among others the.
Developing Sars COVID-19, two antibody by sensor or F. D. I E. You a submission.
Completing clinical protocols for FDA review, what's the lot of the glucose bio sensor.
Establishing the world's first validate it twice the boat.
So lot of glucose reference of method in collaboration with John Hopkins.
Progressing design transfer to manufacturing or asked a lot of the glucose by sensor.
Securing out licensing and sub licensing partnership opportunities for commercialization in the APEC region.
And finally conflating a build of a high take by since the facility.
We as management and the board are working in the lock step to channel GBS is robust capabilities to benefit all the shareholders and ultimately enhance shareholder value.
Well now the Nicole for questions.
Operator, please open the floor to questions.
Thank you.
Ladies and gentlemen at this time, we'll be conducting a question and answer session. If you'd like to ask a question you May press star one on your telephone keypad.
The confirmation tone will indicate your line is in the question queue.
The press star two if you'd like to remove your question from the Q4.
Core of participants using speaker equipment, it may be necessary to pick up of your handset before pressing the star key one moment. Please while we poll for questions.
Our first question comes from Brian Vander most of them with Zacks SCR. Please proceed with your question.
Hey, Thank you and this is Jon Vander most of them are.
Good day to you guys Harry spirit of get too good to chat with you.
Question is on on.
On the the L E K consulting.
Hopefully that's coming along great what what are some of the characteristics you're looking for in the in the partners for distribution in the APAC region.
Hey, John Thank you for the question I'm really appreciate that and thank you for joining as well.
One of the characteristics in terms of any of the distributors dawn, which well on market.
Ensuring that the first of all hard the type of the ability to reach as many patients as possible. So they do require a plethora of footprint within the market.
The other key aspects of that they do require and the capabilities that we are looking for our partners is the ability to be very well connected both of the health care of industry, but also from a regulatory standpoint as it is very important the when we do when.
When we bring these production market that we enter the market very fast.
So those of the key aspects of it was obviously a lot more characteristics that we're looking for the ideal partner, but in summary, one they've got in the existing footprint. So we can get into the market very fast and secondary.
The strong relationships with health care.
Detroit problems.
Okay, great great that makes sense and one of the goals of you outlined for I think on the previous quarterly update was achieving.
Achieving the the clinical protocol and I think you guys have achieved that now where you're able to touch base with the EMA on the F. D. A to help develop that or is that something still that you're going to refine going forward and you know how how does it look in terms of talking to the agencies to get get their input before you finalize that.
Yeah, John again, Great question look it's always important to ensure that when we do hooked to the authorities. We've got all our ducks in the line as well.
On the other aspect, we continuously do talk to the FDA.
I'm showing that we have got the right and the process and methodology as we move forward well we are in.
On the cautious right now of doing a pre submission with the FDA. So we can actually ensure that all of our protocols are in place and they just simply expected to continue over the next quarter, we will send them. So as you as you explained yes, absolutely we are advancing our clinical protocols and when they are ready to finalize the names will be doing the submission.
Two of the SCR, which we expect.
The Hudson he decided this year.
Okay, great great and the last one for me is is there a timeline on the on the construction of that manufacturing facility is that something we expect on the I guess on the next months or the next quarters or what should we think about in terms of the timeline for having that online.
Yeah, John we have commenced straight away as soon as we got the grant, which we were one of only six companies.
Companies in Australia that was given the strength and we are very excited about this.
We started to try the way so we've actually Shortlisted a number of such as were speaking now.
And that will be accelerated in terms of once we get in there and they stop ordering the equipment on doing the manufacturing build out we expect that wanted to be.
We expect to have the sites identified and into the agreement by the end of this quarter and then the completion of the build depending on the timeline of sourcing the manufacturing and the equipment that we need all of the facility because the seams that very high tech facility.
On building, we anticipate that to be done on completed by the first half of all of next year.
Oh, great great. Thank you for the the detailed the timeline.
Time on there I appreciate it. Thank you Harry Thank you Spiro.
Thank you John always or the pleasure.
At this time there are no further questions I'd like to turn the floor back over to Mr. Simonette of for closing remarks.
Thank you operator.
Thank you everyone very muscle of joining our call Tonight.
We remain very excited for the future of GBS and its multiple product opportunities in both of the knee and long term.
Our bias into the technology has fueled our passion to develop of affordable morning by cheap real time pull on the Kid diagnostic tests for both patients and the primary health care providers.
We appreciate everyone's support and thank you again for joining of annual conference of update call.
Thank you for your participation you may disconnect. Your lines at this time and have a great rest of the day.