Q2 2024 MediWound Ltd Earnings Call
Good day, and welcome to MediWound's second quarter of 2024 earnings call. Today's conference is being recorded. If you require operator assistance, please signal for an operator by pressing the star key, then zero on your telephone keypad.
Ernie Schaul: 24th, Ernie Schaul Today's conference is being recorded. If you require operator assistance... Please signal for an operator by pressing the start key then zero on your telephone.
Gaia Shin: [inaudible] At this time, I would like to turn the conference over to Gaia Shin, of Lifesci Advisors. Please go ahead. Thank you, Chris, and welcome, everyone. Today, before the market opened, Mediwound issued a press release announcing financial results for the second quarter ended June 30, 2024. You may access that release on the company's website under the Investors tab. With us today are Ofer Gonen, Chief Executive Officer of Mediwound, Hani Luxenburg, Chief Financial Officer, and Barry Wolfenson, Executive Vice President of Strategy and Corporate Development.
At this time, I would like to turn the conference over to Gaia Chamis of Lifesci Advisors. Please go ahead.
Gaia Chamis: Thank you, Chris, and welcome, everyone. Today, before the market opened, Medibond issued a press release announcing financial results for the second quarter and then June 30th, 2024. You may access that release on the company's website under the Investors tab.
Speaker Change: With us today are Ofer Gonen, Chief Executive Officer of Medibund, Hani Luxenburg, Chief Financial Officer, and Barry Wolfenson, Executive Vice President of Strategy and Corporate Development.
Gaia Shin: Following our prepared remarks, we will open the call for Q&A. Before we begin, I would like to remind everyone that statements made during this call, including the Q&A session, relating to Mediwound's expected future performance, future business prospects, or future events or plans are forward-looking statements, as defined under the Private Securities Litigation Reform Act of 1995. Although the company believes that expectations reflected in such forward-looking statements are based upon reasonable assumptions, actual outcomes and results are subject to risks and uncertainties and could differ materially from those forecast due to the impact of many factors beyond the control of MediWound.
Speaker Change: Following our prepared remarks, we will open the call for Q&A.
Gaia Shin: The company assumes no obligation to update or supplement any forward-looking statements, whether as a result of new information, future events, or otherwise. Participants are directed to cautionary notes set forth in today's press release, as well as the risk factors set forth in Mediwound's annual report filed with the FCC, for factors that could cause actual results to differ materially from those anticipated in the forward-looking statement. The conference call is the property of Mediwound, and any recording or rebroadcast is expressly prohibited without the written consent of Mediwound. Now, I would like to turn the call over to Ofer Gonen, Chief Executive Officer of MediWound. Ofer?
Speaker Change: Before we begin, I would like to remind everyone that statements made during this call
Speaker Change: including the Q&A session relating to Mediwound's expected future performance, future business prospects, or future events or plans or forward-looking statements as defined under the Private Securities Litigation Reform Act of 1995.
Speaker Change: Although the company believes that expectations reflected in such forward-looking statements are based upon reasonable assumptions, actual outcomes and results are subject to risks and uncertainties and could differ materially from those forecast due to the impact of many factors beyond the control of Mediwound.
Speaker Change: The company assumes no obligation to update or supplement any forward-looking statements, whether as a result of new information, future events, or otherwise.
Speaker Change: Participants are directed to cautionary notes set forth in today's press release, as well as the risk factors set forth in Medellin's annual report filed with the SEC for factors that could cause actual results to differ materially from those anticipated in the forward-looking statement.
Speaker Change: The conference call is the property of MediWound and any recording or rebroadcast is expressly prohibited without the written consent of MediWound.
Speaker Change: Now, I would like to turn the call over to Ofer Gonen, Chief Executive Officer of Monday Mornings. Ofer?
Ofer Gonen: Thank you, Gaia. And good morning, everyone. We appreciate you joining us today as we are excited to share the results of another strong quarter. The second quarter has been pivotal for our company as we continue to execute our strategic plan to become a global leader in tissue repair. At the beginning of the year, we set three key goals.
Ofer Gonen: Thank you, Gaia, and good morning, everyone. We appreciate you joining us today as we are excited to share the results of another strong quarter.
Speaker Change: The second quarter has been pivotal for our company as we continue to execute our strategic plan to become a global leader in tissue repair.
Speaker Change: At the beginning of the year, we set three key goals. First, to complete the construction of our new manufacturing facility.
Ofer Gonen: First, to complete the construction of our new manufacturing facility. Second, to accelerate the revenue growth of next- and 3rd, to initiate the Phase Reclinical Trial of F. I am pleased to report that we have successfully completed the first goal, and we are well on track to achieving the remaining objectives. Moreover, we awarded 15.25 million euros in funding for the expansion of escarolex's indication to include diabetic foot ulcers. Significantly increasing the product's total addressable marks [inaudible] We also raised $25 million in financing, led by industry leader Molnike, reflecting strong confidence in our technology and significantly enhancing our financial. Let me begin with an update on ExoBrid, our drug for Efter removal for Sivirberg. As mentioned, we have completed the construction of our new, state-of-the-art, GMP-compliant manufacturing facility.
Speaker Change: Second, to accelerate the revenue growth of NexoBrid.
Speaker Change: and third, to initiate the Phase III clinical trial of S-Correx.
Speaker Change: I am pleased to report that we have successfully completed the first goal and we are well on track to achieving the remaining two.
Speaker Change: Moreover, we awarded...
Speaker Change: 16.25 million euros in funding for the expansion of S-Correct's indication to include diabetic foot alters, significantly increasing the product's total addressable market.
Speaker Change: We also raised $25 million in financing, led by industry leader Molneke, reflecting strong confidence in our technology and significantly enhancing our financial position.
Speaker Change: Let me begin with an update on Exobrid, our drug for eschar removal for severe burns.
Speaker Change: As mentioned, we have completed the construction of our new, state-of-the-art, GMP-compliant manufacturing facility, ExoBrid.
Ofer Gonen: The commissioning process will begin soon, and we aim to achieve full operational capacity in 2021. The new facility will allow us to support the growing global demand for Nexobreed by increasing our manufacturing capacity 6-fold. In the United States, the launch of Nexobreed by VeriCell continues to build strong momentum. Approximately 70 burns and...
Speaker Change: The commissioning process will begin soon and we aim to achieve full operational capacity in 2025.
Speaker Change: The new facility will allow us to support the growing global demand for Nexobreed by increasing our manufacturing capacity six fold.
Speaker Change: In the United States, the launch of NexoBridge by VeriCell continues to build strong momentum.
Ofer Gonen: Completed submission to their PNT committees with over 40 centers already obtaining approval and nearly all of them placing initial product orders. VASIL reported a notable increase in hospital orders and the number of patients treated, driving a revenue growth of 76% over the prior quarter. Additionally, when FBA approval of the Pediatric Indication for Nexobrid Varys, which would provide a crucial treatment option for pediatric patients with severe thermal burns.
Speaker Change: Approximately 70 burn centers have completed submission to their P&T committees with over 40 centers already obtaining approval and nearly all of them placing initial product orders.
Speaker Change: Beresel reported a notable increase in hospital orders and the number of patients treated, driving a revenue growth of 76% over the prior quarter.
Speaker Change: Additionally, we anticipate FDA approval of the pediatric indication for Nexobrid very soon, which would provide a crucial treatment option for pediatric patients with severe thermal burns.
Ofer Gonen: We also had positive results from the United States Nexobrid Expanded Access Protocol, the NEXT program. Introduced in 2019, NEXT ensured the continuous availability of Nexobreed in burn centers prior to its commercialization. This program successfully maintained physician expertise, provided burn victims with ongoing access to this life-saving treatment, and facilitated the accumulation of real-world safety clinical data for next. The study was conducted at 29 burn centers across the United States and enrolled 239 patients, including 215 adults and 24 children, with severe thermal burns covering up to 30% of total body surface area.
Speaker Change: We also had positive results from the United States Nexobrid Expanded Access Protocol, the NEXT program.
Speaker Change: Initiated in 2019, NEXT ensured the continuous availability of Nexobreed in burn centers prior to its commercialization.
Speaker Change: This program successfully maintained physician expertise, provided burn victims with ongoing access to this life-saving treatment, and facilitated the accumulation of real-world safety clinical data for Nexobrid.
Speaker Change: The study was conducted at 29 burn centers across the United States.
Speaker Change: and enrolled 239 patients, including
Speaker Change: 215 adults and 24 children with severe thermal burns covering up to 30% of total body surface area.
Ofer Gonen: The findings from NEXT are consistent with the data from DETECT and the KID Phase 3 trials, reinforcing the clinical role, the critical role, that NexoBridge should play in standard burn care protocols. Nexobrid is reaffirmed as a safe and effective eschar removal enzymatic agent that successfully reduces the need for surgical procedures in burn patients.
Speaker Change: The findings from the NEXT are consistent with the data from the DETECT and the KID phase 3 trials, reinforcing the critical role that NexoBridge should play in standard burn care protocols.
Speaker Change: Nexobreed was reaffirmed as a safe and effective eschar removal enzymatic agent that successfully reduces the need for surgical procedures in burn patients.
Ofer Gonen: Regarding the development of a room temperature stable for the population of Nexobrid, our partnership with the United States government remains very strong. During a recent PIPE meeting, the FDA provided comprehensive guidance on our CMC plan, non-clinical development plan, and regulatory strategy. We also received initial feedback on our clinical trial design, indicating that we will be able to initiate the clinical trial in 2020. The DoD has awarded us an additional $1.5 million to support our ongoing research and development. Now, turning to S-Corrects, our innovative therapy for debriding chronic wounds.
Speaker Change: Regarding the development of a room temperature stable formulation of Nexobrid, our partnership with the United States government remains very strong.
Speaker Change: During a recent type meeting, the FDA provided comprehensive guidance on our CMC plan, non-clinical development plan, and regulatory strategy.
Speaker Change: We also received initial feedback on our clinical trial design, indicating that we will be able to initiate a clinical trial in 2026.
Speaker Change: The DoD has awarded us an additional $1.5 million to support our ongoing research and development activities.
Speaker Change: Turning now to S-Corrects, our innovative therapy for debriding chronic wounds.
Ofer Gonen: There have been several exciting developments. We received 16.25 million euros in funding from the European Commission under a prestigious and highly competitive program. This funding will facilitate the expansion of SCAREX's indications to include diabetic foot ulcers or DFUs, a substantial and underserved market. Notably, this will expedite our associated revenue projections by four years. Preparations for the DFU Phase 2-3 study are currently underway. Proper treatment of diabetic foot ulcers is critical to preventing serious complications, including Amputations, Infections, and even Death.
Speaker Change: There have been several exciting developments.
Speaker Change: We received 16.25 million euros in funding from the European Commission through a prestigious and highly competitive program.
Speaker Change: This funding will facilitate the expansion of SCAREX's indications to include diabetic foot alters, or DFUs, a substantial and underserved market.
Speaker Change: Notably, this will expedite our associated revenue projections by four years.
Speaker Change: Preparations for the DFU Phase 2-3 study are currently underway.
Speaker Change: Proper treatment of diabetic foot ulcers is critical to preventing serious complications, including amputations, infections, and even death.
Ofer Gonen: Among the 38 million diabetic patients in the United States, approximately 30% will develop DFUs in their lifetime. 70% of these patients, and we are speaking about 1.6 million patients every year, will require debridement, either with a painful surgical procedure or with an ineffective alternative treatment.
Speaker Change: Let's look at the numbers.
Speaker Change: Among the 38 million diabetic patients in the United States,
Speaker Change: Approximately 30% will develop DFUs in their lifetime.
Speaker Change: Seventy percent of these patients, and we are speaking about 1.6 million patients every year, will require debridement, either with a painful surgical procedure or with an ineffective alternative treatment.
Ofer Gonen: Our program has the potential to have a significant impact on the treatment of diabetic foot ulcers, transforming the current standard of care into a very simple, quick, and safe solution. Dramatic Benefit to the Millions of Dr. Prado, Dr. Prado, Dr. Prado, Dr. Prado, Dr. Prado, Dr. Prado, We are also finalizing the preparations for our Phase III study for treating venous leg ulcers, VLU. Following this success of our face to try, The results of one of these Phase II trials were recently published in the Lancet eClinical Medicine Journal, demonstrating SRX's superiority over the non-surgical standard of care in debridement and in the promotion of healthy granulation, and the upcoming Phase III study will replicate the successful design of our Phase II trials and will be structured as a multi-center, prospective, randomized, and placebo-controlled global trial.
Speaker Change: Our program has the potential to have a significant impact on the treatment of diabetic foot ulcers, transforming the current standard of care to a very simple, quick, and safe solution. A dramatic benefit to the millions of patients.
Speaker Change: We are also finalizing the preparations for our Phase III study for treating venous leg ulcers, VLUs.
Speaker Change: following the success of our Phase II tribes.
Speaker Change: The results of one of these Phase II trials were recently published at the Lancet eClinical Medicine Journal, demonstrating Escarex's superiority over the non-surgical standard of care in debridement and in the promotion of healthy granulation tissue.
Speaker Change: The upcoming Phase III study will replicate the successful design of our Phase II trials and will be structured as a multicenter, prospective, randomized, and placebo-controlled global trial.
Ofer Gonen: We aim to enroll 216 patients across over 40 sites. An interim assessment will be conducted after 67% of the participants have completed the trial, providing early insights into the efficacy of FTP. The study is scheduled to start in the second half of 2024 as planned. Our ability to consistently execute on multi-year plans, as reflected in the significant progress of our NexoBreed and Escor-X programs, has attracted strategic interest from prominent industry players.
Speaker Change: We aim to enroll 216 patients across over 40 sites. An interim assessment will be conducted after 67% of the participants have completed the trial and providing early insights into the efficacy of S-Corrects.
Speaker Change: The study is scheduled to start in the second half of 2024 as planned.
Speaker Change: Our ability to consistently execute on multi-year plans, as reflected in the significant progress of our NEXO-BREED and ESCOREX programs, has attracted strategic interest from prominent industry players.
Ofer Gonen: Just recently, we raised $25 million in private investment led by Malniki Healthcare, a global leader in the wound care sector. This investment demonstrates confidence in our technology and significantly strengthens our financial position. In addition, we have signed a strategic collaboration agreement with them. The agreement provides us with access to Monique's commercial insights and Critical Clinical and Regulatory Expertise.
Speaker Change: Just recently, we raised $25 million private investment led by Malniki Healthcare, a global leader in the wound care solutions.
Speaker Change: This investment demonstrates confidence in our technology and significantly strengthens our financial position.
Speaker Change: In addition, we have signed a strategic collaboration agreement with them.
Speaker Change: The agreement provides us with access to Monique's common insights, its clinical and regulatory expertise.
Hani Luxenburg: Chenel Reed, It also includes Monique's participation in certain potential strategic partnership discussions and M&A processes. Collaboration aims to enhance our strategic plans and create substantial long-term value for our stake. Now, I will hand it over to Hani to briefly review our finances. Thank you, Ofer.
Speaker Change: and Educational Resources.
Monique Kosse: This also includes Monique's participation in certain potential strategic partnership discussions and M&A processes.
Monique Kosse: This collaboration aims to enhance our strategic plans and create substantial long-term value for our stakeholders.
Monique Kosse: Now I will hand it over to Hani to briefly review our financials. Thank you, Ofer.
Hani Luxenburg: Let me begin with our revenue for the second quarter. Our revenue for the second quarter of 2024 was $5.1 million compared to $4.8 million in the same period of 2023. This increase is primarily attributed to revenue from VeriCell. Gross profit in the second quarter of 2024 was $0.4 million, representing 9% of total revenue, compared to $1.1 million, representing 24% of total revenue in the second quarter of 2023. The decrease in gross margin is mainly due to changes in the revenue mix and non-recurrent production costs.
Hani: Let me begin with our revenue for the second quarter.
Hani: Revenue for the second quarter of 2024 was $5.1 million, compared to $4.8 million in the same period of 2023. This increase is primarily attributed to revenue from VeriCell.
Hani: Gross profit in the second quarter of 2024 was $0.4 million, representing 9% of total revenue, compared to $1.1 million, representing 24% of total revenue in the second quarter of 2023.
Hani: The decrease in gross margin is mainly due to changes in the revenue mix and non-recurrent production costs.
Hani Luxenburg: Turn it to our Operating Expense [inaudible] RMD expenses for the second quarter of 2024 were 1.9 million compared to 2 million in the same period of 2023. S-GNA expenses for the second quarter of 2024 were 3 million compared to 3.1 million in the second quarter of 2023. Operating loss for the second quarter of 2024 was $4.5 million, compared to an operating loss of $4 million in the second quarter of 2021. Net loss for the second quarter of 2024 was $6.3 million or $0.68 per share, compared to a net profit of $0.9 million or $0.10 per share in the second quarter of 2023.
Speaker Change: Turning to our operating expenses.
Speaker Change: RMD expenses for the second quarter of 2024 were $1.9 million compared to $2 million in the same period of 2023.
Speaker Change: SG&A expenses for the second quarter of 2024 were $3 million compared to $3.1 million in the second quarter of 2023.
Speaker Change: Operating loss for the second quarter of 2024 was $4.5 million compared to an operating loss of $4 million in the second quarter of 2023.
Speaker Change: Net loss for the quarter of 2024 was $6.3 million or $0.68 per share, compared to a net profit of $0.9 million or $0.10 per share in the second quarter of 2023.
Hani Luxenburg: This chance is primarily due to financial expenses driven by the revaluation of warrants. Non-gap adjusted EBITDA for the second quarter of 2024 was a loss of $3.4 million, compared to a loss of $3 million in the same period of 2023.
Speaker Change: This change is primarily due to financial expenses driven by the revaluation of warrants.
Speaker Change: Non-gap adjusted EBITDA for the second quarter of 2024 was a loss of $3.4 million, compared to a loss of $3 million in the same period of 2023.
Hani Luxenburg: Moving on to our up-to-date financial highlights, total revenue for the first half of 2024 was $10 million, up from $8.6 million in the first half of 2023. The increase is mainly attributed to revenue from Verisel, a new contract with the U.S. Department of Defense. Gross profit for the first half of 2024 was $1.1 million, or 11% of total revenue, compared to $2 million, or 23% of total revenue in the first half of 2024.
Speaker Change: Moving on to our E-to-Date financial highlights.
Hani Luxenburg: R&D expenses for the first half of 2024 were $3.4 million compared to $4.1 million in the first half of 2021. This decrease is primarily due to the completion of the S-Corex Phase II study. SG&A expenses for the first half of 2024 were $5.9 million, down from the $6.2 million in the first half of 2024. Operating loss for the first half of 2024 was $8.2 million compared to an operating loss of $8.4 million in the same period of 2026.
Speaker Change: Total revenue for the first half of 2024 was $10 million, up from $8.6 million in the first half of 2023.
Speaker Change: The increase is mainly attributed to revenue from Verisel, a new contract with the US Department of Defense.
Speaker Change: Gross profit for the first half of 2024 was 1.1 million or 11% of total revenue compared to 2 million or 23% of total revenue in the first half of 2023.
Speaker Change: R&D expenses for the first half of 2024 were $3.4 million compared to $4.1 million in the first half of 2023.
Speaker Change: This decrease is primarily due to the completion of the escrow phase 2 study.
Speaker Change: SG&A expenses for the first half of 2024 were $5.9 million, down from the $6.2 million in the first half of 2023.
Speaker Change: Operating loss for the first half of 2024 was $8.2 million compared to an operating loss of $8.4 million in the same period of 2023.
Hani Luxenburg: The net loss for the first quarter of 2024 was $16 million or $1.73 per share, compared to a net loss of $2.8 million or $32 cents per share in the first half of 2020. The increase in net loss is primarily due to financial expenses.
Speaker Change: Net loss for the first half of 2024 was $16,000,000 or $1.73 per share, compared to a net loss of $2.8 million or $0.32 per share in the first half of 2023.
Speaker Change: The increase in net loss is primarily due to the financial expenses.
Hani Luxenburg: These expenses are from the revaluation of warrants amounting to $8 million, driven by a 53% increase in our share price. Adjusted EBITDA for the first half of 2024 was a loss of $6.2 million compared to a loss of $6.4 million in the first half of 2021. Balance Sheet Highlight. As of June 30, 2024, the company had cash and cash equivalents, restricted cash, and deposits totaling $29.7 million, compared to $42.1 million as of December 31, 2026.
Speaker Change: These expenses are from revaluation of warrants amounting to $8 million, driven by a 53% increase in our share price.
Speaker Change: Adjusted EBITDA for the first half of 2024 was a loss of $6.2 million compared to a loss of $6.4 million in the first half of 2023.
Speaker Change: Balance Sheet Highlights
Speaker Change: As of June 30, 2024, the company had cash and cash equivalent, restricted cash and deposits totaling $29.7 million, compared to $42.1 million as of December 31, 2023.
Hani Luxenburg: In the first half of 2024, the company received $0.6 million from the sale of Sirius A. Warren. The company utilized $12.9 million to fund its activities in the first half of 2024. This included $4.3 million allocated to CAPEX, primarily for our facility scale-up. On July 15, the company successfully raised $25 million through a pipe offering.
Speaker Change: In the first half of 2024, the company received $0.6 million from the exercise of Series A warrants.
Speaker Change: The company utilized $12.9 million to fund its activities in the first half of 2024. This included $4.3 million allocated to CAPEX primarily for our facility scale-up.
Speaker Change: On July 15, the company successfully raised $25 million through a PIPE offering.
Ofer Gonen: This concludes the financial review. I will now turn the call back to Ofer. Ofer?
Speaker Change: This concludes the financial review. I will now turn the call back to Ofer.
Ofer Gonen: Thank you, Hani. This was another very strong quarter.
Ofer Gonen: We successfully raised capital, collaborated with one of the largest wound care companies in the world.
Ofer Gonen: Significantly expanded our target market for SRX and completed the construction of our next-of-breed manufacturing facility as planned.
Ofer Gonen: We are now well positioned with all the resources we need to achieve our goals and look forward to an exciting second half of the year.
Ofer Gonen: Thank you, Hani. This was another very, strong quote. We successfully raised capital, collaborated with one of the largest one-care companies in the world, significantly expanded our target market for SRX, and completed the construction of our next-of-breed manufacturing facility as planned. We are now well positioned with all the resources we need to achieve our goals and look forward to an exciting second half. With this said, I'd like now to turn back to the operator for any questions you may have. Operator?
Ofer Gonen: With this said, I'd like now to turn back to the operator for any questions you may have. Operator?
Operator: Thank you. We will now begin the question and answer session. To ask a question, you may press a star and then one on your telephone keypad. If you're using a speakerphone, please pick up your handset before pressing the keys.
Speaker Change: Thank you. We will now begin the question and answer session. To ask a question, you may press a star, then one on your telephone keypad. If you are using a speakerphone, please pick up your handset before pressing the keys.
Operator: If at any time your question has been addressed, and you would like to withdraw it, please press star then two. At this time, we will pause momentarily to assemble our roster. And today's first question comes from Josh Jennings with PD Cowlin. Please proceed. Hi, good morning.
Speaker Change: If at any time your question has been addressed and you would like to withdraw it, please press star then 2. At this time, we will pause momentarily to assemble our roster.
Speaker Change: [inaudible]
Speaker Change: And today's first question comes from Josh Jennings with TD Cowen. Please proceed.
Josh Jennings: Thanks for taking the questions, and it's great to see all the progress in 2Q. I wanted to start on Nexabrid, and congratulations on getting that facility buildout completed. I just wanted to better understand the next steps to increasing Nexabrid capacity and whether that kind of unlocking or eliminating capacity constraints could occur in early 2025 or mid-2025. And just how are you managing expectations from your distributor partners in India and Japan and polymers for Europe?
Josh Jennings: Good morning. Thanks for taking the questions.
Speaker Change: It's great to see all the progress in 2Q.
Josh Jennings: I wanted to start on Nexibrid and congratulations on getting that facility buildout completed.
Speaker Change: Unknown Attendee, Barry Wolfenson, Monique Kosse, Unknown Attendee, Barry Wolfenson,
Speaker Change: could occur in early 2025 or mid 2025, just how are you managing expectations from your distributed partners in India, and Japan, and Polymedics for Europe?
Ofer Gonen: Thank you for the question, Josh. Thank you for joining the call. So considering the dynamics around Nexobrid, as you know, we have had major market launches recently in the United States, Japan, India, expansions of indications, including the pediatric population that we were awarded in Europe, and we are waiting for it to be in the United States very shortly. And also, we are working on military use. And there is also a growing governmental interest.
Speaker Change: Thank you for the question, Josh. Thank you for joining the call.
Speaker Change: So, considering the dynamics around NexoBridge, as you know, we have...
Speaker Change: Major market launches recently, United States, Japan, India, expansions of indications including the pediatric population that we were awarded in Europe and we are waiting for it to be in the United States very shortly.
Speaker Change: and also we are working on the military use. And there is also a growing governmental interest. So our assumption is that the demand for Nexobrid will escalate rapidly.
Ofer Gonen: So our assumption is that the demand for Nexobrid will escalate rapidly. This is the reason why we have put a lot of effort into making sure that we complete the construction of the new state-of-the-art manufacturing facility as planned. We are starting the commissioning very soon. It can be; it is a one year process.
Speaker Change: This is the reason why we spent a lot of effort in making sure that we complete the construction of the new state-of-the-art manufacturing facility as planned.
Speaker Change: We are starting the commissioning very soon.
Speaker Change: It can be, it is a one year process.
Ofer Gonen: It includes six months of stability, so you can't expect... We will be earlier. Having said that, as I stated in previous calls, we expect European approval to be earlier in May 2025, and in the United States, we expect it to be in the end of 2025, and our forecast is to reflect this... Excellent. Thank you. You did, thank you. And just, big, big deal, this EIC funding for the DFU trial, and I was hoping to get a better understanding of the mechanics of it, and will this funding come in tranches? Is it a one-time thing? David Morgan, Michael Okenewitch, Swayampakula Ramakanth, Daniel Ferry, Monique Kosse, Ofer Gonen, Hani Luxenburg, Barry Wolfenson, Gaia Vasiliver, Mediwound, Um...
Speaker Change: It includes six months of stability, so you can't expect...
Speaker Change: to be earlier. Having said that, as I stated in previous calls,
Speaker Change: We expect the European approval to be earlier in 2025 and in the United States we expect it to be at the end of 2025 and our forecast reflects this execution.
Speaker Change: Did I answer your question?
Speaker Change: You did, thank you.
Speaker Change: Big, big deal, this EIC funding for the DFU trial. I was hoping to get a better understanding of the mechanics of it, and will this funding come in tranches? Is it a one-time...
Speaker Change: Download of capital to find the trial, how do you access the capital? And just should we be thinking that the VFP trial could kick off the face 2-3 could kick off in 2025?
Ofer Gonen: So thank you for this question as well. So we were just notified about this funding a few weeks ago, and those were final assumptions regarding the initiation and the structure of the trial, which will, of course, be based on the feedback that we are going to get from the FDA and the EM. We anticipated it to be along this line.
Speaker Change: So, thank you for this question as well. So, we were just notified about this funding a few weeks ago.
Speaker Change: And that we're.
Speaker Change: Final assumptions regarding the initiation and the structure of the trial, of course, will be based on the feedback that we are going to get from the FDA and the EMA.
Ofer Gonen: We think that the first year will be dedicated to negotiating with the regulatory authorities, MNFDA, and to do all kinds of setup activities for the trial. After that, we plan to have a trial which is very similar to our face-to-face trial with the winner's leg alters, and we also anticipate that it will take two years, but we need to get clarification on that. As for the funding, it's a mechanism where you will never see those 16.25 in our balance sheet. We will just, we'll just get reimbursed.
Speaker Change: We anticipate it to be along this line. We think that the first year will be dedicated to negotiate with the regulatory authorities, EMA and FDA, and to do all kinds of setup activities.
Speaker Change: for the trial. After that, we plan to have a trial which is very similar to our phase 3 trial with the diabetic, with the venous leg alters. And it also, we anticipate that it will take two years, but we need to get clarity for that.
Honey: As for the funding, it's a mechanism of, you will never see those 16.25 in our balance sheet. We will just get reimbursement, I think quarterly, Hani, is it quarterly, we will get quarterly reimbursement on expenses, but basically it should fund these activities.
Ofer Gonen: I think Quarterly, Hani is it Quarterly, we'll get Quarterly Reimbursement on Expenses, but basically, it should find this. Upstanding, and then just one last one on the ESGREX BLU, the Pivot Study. Sorry if I missed this in your prepared remarks, but just has the protocol been submitted and then approved by the FDA? Maybe just kind of help us think about it.
Speaker Change: Outstanding. And then just one last one on the VS Greggs VLU Pivotless Study.
Speaker Change: Sorry if I missed this in your prepared remarks, but just, has the protocol been submitted and then approved by the FDA? Maybe just kind of help us think about...
Ofer Gonen: I know you've answered this question multiple times in the past, but just the timing in terms of getting to that kind of two-thirds enrollment for the interim analysis when investors should be anticipating that initial potential catalyst for this VLU development program. Thanks a lot. So, as for the phase 3 study, we are on track to initiate the trial in the second half of 2020 or 2024.
Speaker Change: I know you've answered this question multiple times in the past, but just the timing, in terms of getting to that kind of two-thirds enrollment for their interim analysis.
Speaker Change: when the investor should be anticipating that initial.
Speaker Change: potential catalysts for for this VLU development program. Thanks a lot.
Speaker Change: So as for the face we started, we had a contract to initiate the trial in the second half of 2020.
Ofer Gonen: We are about to submit the protocol for final approval to the FDA. You can look at the presentation that we have on our website showing that this task is about to be done very shortly. We are working on the set-up activities, which means signing contracts with all the medical centers. We have 40 of those, but current expectations are that we will start the trial in the second half of this year. The study itself should be around 18 months of recruitment with a six months of start-up activity.
Speaker Change: 2024. We are about to submit the protocol for final approval for the FDA. You can look at the presentation that we have in our website showing that this
Speaker Change: This task is about to be done very shortly. We are working on the setup activities, which means signing contracts with all the medical centers. We have 40 of those.
Speaker Change: But...
Speaker Change: The current expectation is that we will start the trial in the second half of this year. The study itself should be around 18 months of recruitment with 6 months of start-up activities.
Ofer Gonen: In between, after one year, or after recording six... 66% of the patients, we should have an interim look and get an early insight into the efficacy of the drug. Thanks for reviewing that and probably other answers. Thank you. The next question is from R.K. with H.C. Wainwright.
Speaker Change: In between, after one year or after recruiting 66% of the patients, we should have an interim look and getting an early insight about the efficacy of S-Corrects.
Speaker Change: Thanks for reviewing that and for all the other answers.
Speaker Change: Thank you.
Speaker Change: The next question is from R.K. with H.C. Wainwright. Please proceed.
R.K.: Please proceed. Thank you. So, good morning, I mean good afternoon, Ofer and Hani. I have a couple of quick questions.
R.K.: On getting the facility commissioned for expanding manufacturing capacity. So, what else is needed for you folks at this point so that you can get this facility into manufacturing mode? That's question number one.
Speaker Change: on getting the facility commissioned for expanding manufacturing capacity.
Speaker Change: So, what else is needed for you folks at this point?
Speaker Change: so that you can get this.
R.K.: And question number two is on Escalix for the DFU. I know you're looking to start a phase two, three study on that. For that indication. Thank you. What do you need to achieve before trying to start writing a protocol for that clinical study? Hi Okun.
Speaker Change: What do you need to achieve before trying to start writing a protocol for that clinical study?
Ofer Gonen: Thank you for your question. So, let me start with the manufacturing scale up. So, as we just said that the construction is completed as planned, now we need to start manufacturing. You know, it's a process that takes a few months to make sure that everything that you are able to do in 1x scale, you can do it in 5x scale.
Ofer Gonen: Ofer Gonen.
Speaker Change: Hi Arkin, thank you for your question.
Ofer Gonen: So let me start with the manufacturing scale-up. So as we just said, the construction is completed as planned.
Speaker Change: Now we need to start manufacturing. You start manufacturing, it's a process that takes a few months, making sure that everything that you were able to do in 1x scale, you can do it in 5x scale. After that, you need to...
Speaker Change: to manufacture a few batches of NexoGrid and go through six months of stability. So it will be practically waiting time to see that.
Speaker Change: Unknown Attendee, Barry Wolfenson, Monique Kosse, Unknown Attendee, Barry Wolfenson, Unknown
Ofer Gonen: So this is what needs to be done. Mediwound did that a few times in the past, so I don't see any potential delays. As for the second question regarding DFU, we see the results that we see with diabetic foot ulcers and venous leg ulcers are practically similar. They show similar results.
Speaker Change: Here.
Speaker Change: As for the second question regarding the DFU,
Speaker Change: We see, the results that we see with diabetic foot ulcers and venous leg ulcers are practically, they show similar results, like we can't see, you know, we did three phase two studies.
Ofer Gonen: Like we can see, you know, we did three phase two studies, two of them included diabetic-foot-alpha patients. We don't see that it works better in this indication or the other.
Ofer Gonen: Having said that, we have more patients in Venus leg-alpha, so we had a lot of confidence to do a phase retrial with 216 patients, showing, knowing that we were going to hit the efficacy end point. With diabetic-foot-alpha, we have fewer patients, so our thought is, and we need to get clearance from the FDA and EMA. We will do a little bit of a larger clinical trial and look in the interim, let's say after again, after 50% of the patients, 40% of the patients, to see that what we see in diabetic-foot-alpha is very similar to what we see in Venus leg-alpha, and then we will know that we are on the right track.
Speaker Change: Two of them included diabetic foot ulcers patients.
Speaker Change: We don't see that it works better in this indication or the other.
Speaker Change: Having said that, we have more patients.
Speaker Change: Unknown Attendee, Barry Wolfenson, Monique Kosse, Dan Ferry, Hani Luxenburg, Unknown Attendee, Barry Wolfenson, Monique Kosse, Hani Luxenburg, Unknown Attendee, Barry Wolfenson, Monique Kosse, Danielle
Speaker Change: With diabetic foot cancers, we have fewer patients, so our thought is, and we need to get clearance from the FDA and EMA about that.
Speaker Change: that we will do a little bit of a larger clinical trial and look in an interim and to see in between, let's say after again, after.
Speaker Change: 50% of the patients, 40% of the patients to see that what we see in diabetic foot ulcers is very similar to what we see in venous leg ulcers, and then we know that we are on the right track.
Speaker Change: Having said that, we need to have an agreement with the regulatory agencies about that. As you know, in the past 30 years, no drug was approved for wound care, so it's not something that we know for sure that it will be accepted by the FDA.
R.K.: Very good. And then with the EAP results that you achieved, which is obviously good that it's similar to what we have seen before. But how can you utilize this data, either in the U.S. or elsewhere?
Speaker Change: Very good. And then, with the EAP results that you received, achieved,
Speaker Change: which is obviously good that, you know, it's...
Speaker Change: It's similar to what we have seen before.
R.K.: Are there ways that you can use that data for additional regulatory pathways or, you know, I'm just trying to... Um... Reads to commercialize the product? I'm not sure I understood your question, so, again... Basically, how are you utilizing the EAP data? That's what I'm trying to do.
Speaker Change: But how can you utilize this data?
Speaker Change: ways to commercialize the product.
Speaker Change: I'm not sure I understood your question, so again... Basically, how are you utilizing the EAP data? That's what I'm trying to...
Ofer Gonen: The EAC data, it's data, we're going to do a phase 3 trial, 40 centers, 240 patients. It will be a global trial. Half of the patients will probably be recruited in the United States. So it's a phase 3, like the phase 3 in venous leg ulcers. The only difference is timing.
Speaker Change: The DAC data it's a data we're going to do a phase 3 trial 40 centers 240 patients
Speaker Change: It will be a global trial. Half of the patients will probably be recruited in the United States. So it's a phase three, like the phase three in the venous leg ulcers. The only difference is timing. We will start it one year later.
Speaker Change: Okay, perfect, thank you.
Speaker Change: Thank you.
Speaker Change: As a reminder, if you do have a question, please press star, then 1 on your touch-tone phone.
Speaker Change: J.J.
Michael Okuocic: We will start it one year later. OK, perfect, thank you. Thank you. As a reminder, if you do have a question, please press star then one on your touchtone phone. And the next question comes from Michael Okuocic with Maxim Group. Please proceed. Hey guys, good afternoon. Thank you for taking my questions today. I guess to start... I guess to start off, could you just talk a little bit about how much you're expecting the EIC funding to cover for a potential DFU study? And then with that $25 million from Malnicki and the other investors?
Speaker Change: And the next question comes from Michael Okuocic with Maxim Group. Please proceed.
Michael Okuocic: Would that study be fully funded, essentially, given that you're expecting it to be similar to the VLU study? Hi, Michael, and thank you again. Thank you for the question. Our assumption is that the study is at zero cost to Mediwound.
Speaker Change: Hey guys, good afternoon. Thank you for taking my questions today.
Speaker Change: I guess he started.
Speaker Change: I guess to start off, could you just talk a little bit about how much you're expecting the EIC funding to cover on a potential DFU study and then with that $25 million from Monique and the other investors?
Speaker Change: Would that study be fully funded, essentially, given that you're expecting it to be similar to the VLU study?
Speaker Change: Hi Michael and thank you for the question. Our assumption is that the study is at zero cost for MediWound.
Ofer Gonen: It's a study that is based on all the infrastructure that we have here in Mediwound. Maybe we need to recruit another one or two people, three people in order to support that. So our assumption is that it will be fully covered. The capital raise we did, led by Monique, wasn't to cover that. The capital raise for Monique was... We get closer to such a giant in the film and make sure that we are able to financially support all the activities that we have here.
Speaker Change: It's a study that is based on all the infrastructure that we have here in Mediwound. Maybe we need to recruit another one or two people.
Speaker Change: Three people in order to support that, so our assumption is it will be fully covered.
Speaker Change: The capital raise we did, led by Monique, wasn't to cover that. The capital raise for Monique was...
Speaker Change: To become closer to such a giant in the field, and to make sure that we are able to financially support all the activities that we have here. All the activities mean Nexobreed, it means the VLU study, it means the DFU study, we have...
Ofer Gonen: All the activities mean Nexobreed, it means the VLU study, it means the DFU study. We have now more than a cushion to support those strategic activities. So would you expect that you would go through a similar collaboration process for a DFU study like you have with, you know, Monique, obviously, but also memetics and solventum? And then if so, would those be the same components as you would need for VLUs?
Speaker Change: We have now more than a cushion to support those strategic activities.
Speaker Change: Amen.
Speaker Change: So, would you expect that you would go through a similar collaboration process for a DFU study like you have with, you know, Monique, obviously, but also Memetics and Silventam? And then, if so, would that be the same components as you would need for VLUs, and would you try to use the same partners?
Michael Okuocic: And would you try to use the same partners? This is a great question. I can tell you for sure, although we are not there yet, that we will collaborate with very large players around this study as well. The global wound care players are huge in escaroles. Eventually, we'll need to take a decision if we want the same players or others.
Speaker Change: This is a great question. I can tell you for sure, although we are not there yet, that we will collaborate with very large players around this study as well. Thank you.
Speaker Change: around the global wound care players is huge in SRX. Eventually, we'll need to take a decision if we want the same players or others. I can just tell you that the interest around participating in this trial is among all the players in the field.
Ofer Gonen: I can just tell you the interest around participating in this trial among all the players. [inaudible] And just one last one for me, kind of in the same vein of that interest in X-rays. So, I mean, you're working with three of the largest players in wound care on phase three. You had Malinky come on for equity and collaboration, and there were those unconfirmed acquisition rumors. So I wanted to ask just about how much inbound interest are you receiving on Esquirex for partnering or MIA?
Speaker Change: And just one last one for me, kind of in the same vein of that interest in X-Ray.
Speaker Change: So, I mean, you're working with three of the largest players in wound care on that phase three. You had Malinky come on for equity and collaboration, and there were those unconfirmed acquisition rumors. So I wanted to ask just about how much inbound interest are you receiving on Escorex?
Speaker Change: for partnering or MAA.
Ofer Gonen: So, it's an interesting question. I'm not sure I can comment; of course, the company cannot comment on all of this speculation. Having said that, I can tell you that it would be very difficult to find a party or a potential large advanced one-care company in the world that is not interested in collaborating or having access to S-corrects.
Speaker Change: So, it's an interesting question. I'm not sure I can comment. Of course, the company cannot comment on rumors and speculations.
Speaker Change: Having said that, I can tell you that it will be very difficult to find
Speaker Change: a party or a potential large advanced wound care company in the world that is not interested in collaborating or have access to S-Corrects. This is the maximum that I can say at this stage.
Michael Okuocic: This is the maximum that I can say. All right. Thank you. Very helpful. I understand that you can't say too much.
Speaker Change: All right. Thank you. Very helpful. I understand you can't say too much. Thank you for taking my questions today.
Operator: Thank you for taking my questions today. Thank you, Michael. And at this time, there are no further questioners in the queue, and this does conclude our question and answer session. I would now like to turn the call back over to Ofer Gonen for any closing remarks. So thank you everyone for joining us today. We look forward to updating you again on our next quarterly call. The conference is now concluded. Thank you for attending today's presentation, and you may now disconnect.
Michael Okuocic: Thank you, Michael.
Michael Okuocic: And at this time, there are no further questioners in the queue, and this does conclude our question and answer session. I would now like to turn the call back over to Ofer Gonen for any closing remarks.
Ofer Gonen: Thank you everyone for joining us today. We look forward to updating you again on our next quarterly call.
Ofer Gonen: Ferry, Ofer Gonen,
Speaker Change: The conference is now concluded. Thank you for attending today's presentation and you may now disconnect.
Operator: Swayampakula Ramakanth, Daniel Ferry, Monique Kosse, Ofer Gonen, Daniel Ferry, Mediwound, Colition on the face. Swayampakula Ramakanth Swayampakula Ramakanth, Swayampakula Ramakanth, Swayampakula Ramakanth Swayampakula Ramakanth, [inaudible] Kosse, Ofer Gonenburg, Ofer Gonenburg Kosse, Ofer Gonenburg, Dr. Prado, Dr. Prado, Dr. Prado, Dr. Prado, Dr. Prado, Kosse, Ofer Gonenburg, Kosse, Ofer Gonenburg, Swayampakula Ramakanth, [music] John Ferry, John Ferry, John Ferry John Ferry, John Ferry,
Speaker Change: Okay, welcome.
Speaker Change: Shilkole, Shilkole, Dr. Ferry,
Speaker Change: J.J.
Speaker Change: Reviewed by Encountering & Presented by pixelproject.com Encountering & Presented by Encountering & Presented by
Ofer Gonen: And after that, you need to... manufacture a few batches of NexoGrid and go through six months of stability. So it will be practically waiting time to see that NexoGrid is stable after this process of manufacturing. And then there is a submission time, which basically takes around six months as well.
Ofer Gonen: Having said that, we need to have an agreement with the regulatory agencies about that. As you know, in the past 30 years, no drug has been approved for Wound Care, so it's not something that we know for sure that it could be accepted by the FDA.