Q3 2025 Theralase Technologies Inc Earnings Call

Speaker #1: Welcome to Zoom. Enter your meeting ID followed by pound. Enter your participant ID followed. You have joined the meeting as an attendee and will be muted throughout the meeting.

Speaker #2: It's getting to the 90th patient. In the fourth quarter of 2025, signifying the completion of patient enrollment. This will allow us to have a complete data set of 15-month patient follow-up in the first quarter of 2027.

Speaker #2: After data log, THERALASE plans to file a new drug application for marketing approval with Health Canada and the FDA in the beginning of 2027. Assuming the FDA grants us priority review for this NDA and we meet all regulatory requirements, we'd be granted marketing approval for Canada and the United States in the third quarter of 2027.

Speaker #2: Completion of enrollment in this phase two clinical study affords the company a number of clear advantages. One, the opportunity to turn its focus on development of radiation-activated Ritherin for numerous cancers.

Speaker #2: Including glioblastoma multiform, a deadly form of brain cancer, non-small cell lung cancer, pancreatic cancer, colorectal cancer, muscle invasive bladder cancer, leukemia, lymphoma, and multiple myeloma.

Speaker #2: Opportunity to commence development of Ruvitar Two, the topical treatment of herpes simplex one, more commonly known as cold sores. Regulatory approval of this Phase Two clinical study affords the company a number of clear advantages.

Speaker #2: One, the ability to generate significant revenues in Canada and the United States from the sale of this technology to healthcare practitioners, hospitals, and institutions focused on the treatment of patients diagnosed with bladder cancer.

Speaker #2: Two, the opportunity to generate significant capital from the licensing or acquisition of this technology by larger pharmaceutical companies for various geographic reasons. THERALASE plans to complete the preclinical research and clinical development required to commercialize its patented light and radiation-activated small molecules to safely and effectively treat patients diagnosed with these conditions in a non-invasive, minimally invasive format.

Speaker #2: Thus, helping to preserve their quality of life. THERALASE is thus in the transformational phase of its development, financially, clinically, and strategically. Today's call will provide insights into our third quarter 2025 financial performance and current capital position.

Speaker #2: Interim clinical data from study two for BCG unresponsive non-muscle invasive bladder cancer. Expansion of our pipeline into nine high-value indications. Our strategic vision and objectives.

Speaker #2: We believe that the progress that we made over the last few quarters and the steps we are taking in the quarters ahead will allow THERALASE the ability to become a fully operational pharmaceutical company.

Speaker #2: Now that we've covered the required disclosures and overview, I would like to introduce our Chief Financial Officer, Ms. Christina.

Speaker #3: Thank you, Matthew. Before we review the numbers, please note that all financial amounts I will be presenting today are rounded to the nearest thousand Canadian dollars for clarity and simplicity.

Speaker #3: For financial amounts accurate to the dollar, please refer to the third quarter financial statements available on Cedar Plus or on our website. Overall, THERALASE continues to demonstrate strong financial discipline advancing our clinical platforms with a limited balance sheet while continuing to invest in preclinical research and unlock future shareholder value.

Speaker #3: Due to the fact that all of our oncological programs are pre-revenue, total revenue for the nine-month period ending September 30th, totaling $590,000, was derived from the business-to-business sales and service of our cool laser therapy systems.

Speaker #3: In Canada, revenue increased 11% to $550,000 from $497,000. In the US, revenue decreased 64% to $38,000 from $105,000. International sales decreased 89% to $2,000 from $22,000.

Speaker #3: Now that our bladder cancer clinical study is completing enrollment, THERALASE plans to reinvest in both the drug and device divisions. With this investment, revenues in the device division are expected to grow, while investment in the drug division will allow the commencement of clinical development for a number of new clinical study indications.

Speaker #3: Gross margin remains stable at $291,000 year over year. Operating expenses for the nine-month period ending September 30th compared to the nine months of the prior year were comprised of selling expenses of $212,000, which decreased 18%.

Speaker #3: Administrative expenses of $1,445,000, which increased by 12%. Research and development expenses of $2.1 million, which increased by 1%, reflect the ongoing costs of the bladder cancer study.

Speaker #3: The net loss for the first nine months of the year was $3.4 million, which included $700,000 in non-cash charges. Such as amortization and stock-based compensation.

Speaker #3: A $2.9% increase over the prior year. This reflects our continued investment in the bladder cancer clinical study, which will allow enrollment to be completed in the early fourth quarter of 2025.

Speaker #3: In terms of capital, we successfully closed private placements and short-term loans of approximately $2.4 million year to date. We've raised approximately $7.5 million over the past 24 months through non-brokered private placements and short-term loans with significant participation from insiders and long-term shareholders.

Speaker #3: This capital has been strategically deployed to complete enrollment in our bladder cancer clinical study. Looking forward, we are planning to invest in both the drug and device divisions to increase current and future revenue.

Speaker #3: To this end, we are exploring both equity and debt financing, both private and

Speaker #3: institutional. Thank you,

Speaker #1: Christina, for THERALASE's third quarter 2025 financial update. Now I will provide an update on our bladder cancer clinical study. As could be expected, study two remains our top strategic objective.

Speaker #1: This multi-center single-arm phase two registrational clinical study is being used to evaluate the efficacy and safety of Rubidarb, our light-activated small molecule, in patients with BCG unresponsive non-muscle invasive bladder cancer carcinoma in situ.

Speaker #1: To date, we have enrolled and successfully treated 88 out of a total of 90 patients, representing 97.8% of our target enrollment. As previously mentioned, we are on track to complete enrollment in the fourth quarter of 2025.

Speaker #1: Seventy-two patients have completed this clinical study assessment, leaving sixteen of the eighty-eight patients currently undergoing assessment. Study two has achieved a 64.3% complete response at any time, with patients demonstrating no detectable cancer.

Speaker #1: 72.6% total response, which includes patients who achieved a complete response as well as patients who still exhibit positive or suspicious urocytology, suggesting upper tract disease.

Speaker #1: Which is outside the design of our clinical study. In other words, 72.6% of patients demonstrated no disease detected in their bladder. 40% of patients who achieved a complete response continue to show durability of that response at 15 months and beyond.

Speaker #1: Treatment emergent adverse events were noted but did not meet the serious adverse event criteria. These include urinary frequency, 65%. Hematuria, 62.5%. Urinary urgency, 53.8%.

Speaker #1: Which usually resolves within one month of treatment. There were 21 reported serious adverse events, specifically one times grade one, three times grade two, 12 times grade three, three times grade four, which all resolved from between one and 82 days.

Speaker #1: And two times grade five, most of which were not treatment emergent. As a result, there have been no serious adverse events directly related to Rubidarb or to the TLC 3200 medical laser system.

Speaker #1: Used to its activated, confirming an exceptionally high safety and tolerability profile. In assessing patients outside of the defined endpoints of the study, the company has demonstrated a duration of complete response of 22.2% at two years, 20% at three years, and 2.2% at seven years, with additional clinical data still being collected.

Speaker #1: The level of safety efficacy and durability particularly from a single intravesical treatment known as one and done in the industry places Rubidarb in a coveted position as one of the most promising emerging therapies in bladder cancer.

Speaker #1: Our next milestones include enrolling and treating the remaining two patients by the end of 2025, and completing follow-up on all patients until study completion, expected in the first quarter of 2027.

Speaker #1: Completing soft and hard data lock by first quarter 2027. Submitting a new drug application to Health Canada and the FDA FDA for marketing approval in early 2027, expected in six months if prior to review is obtained and if not, then in 10 months.

Speaker #1: With strong interim clinical results, a growing shareholder base, interest from larger pharmaceutical companies for partnerships, and new clinical indications in oncology and virology on the horizon, the company is undertaking a number of strategic initiatives for long-term growth as a publicly listed pharmaceutical company.

Speaker #1: Specifically, separate profit and loss reporting and funding for the drug and device divisions. Potential institutional raise in Canada. Potential US initial public offering subject to financing.

Speaker #1: Capitalizing on expanding and partnering on new clinical indications, these strategic initiatives should help position Theralase for breakout growth in Q4 2025 and beyond.

Speaker #1: As we approach late-stage development in bladder cancer, we are simultaneously advancing a robust pipeline across oncology and infectious disease indications. Including glioblastoma multiform, a deadly former brain cancer.

Speaker #1: Non-small cell lung cancer. The leading cause of deaths worldwide. Pancreatic cancer. A cancer which is often diagnosed late in stage leading to low survival rates.

Speaker #1: Muscle invasive bladder cancer. A disease where the standard of care is bladder removal. Colorectal cancer. The second leading cause of cancer deaths in the United States.

Speaker #1: Hematologic cancers. Such as leukemia, lymphoma, and multiple myeloma. All deadly forms of blood cancers. Herpes simplex virus cold sores. A condition with no cure that affects more than 64% of the world's population under 50.

Speaker #1: Good laboratory practice or GLP toxicology studies for these indications are expected to be commenced at the beginning of 2026. Subject to capital funding. Pending completion of GLP toxicology studies the company anticipates initiating adaptive phase 012 clinical studies in 2026 for various indications.

Speaker #1: These studies will be designed to provide early validation of safety and efficacy providing THERALASE the opportunity to efficiently move from preclinical research to clinical development in high-need therapeutic areas.

Speaker #1: The strength of our technology platform lies in its versatility, target approach, minimally invasive administration, ultra-high safety profile, high efficacy, and broad therapeutic application. THERALASE is building a multifaceted pharmaceutical company capable of addressing major oncology and virology challenges.

Speaker #1: Now I'd like to transition us to the question and answer period of today's call. To answer your questions, I would like to now call upon our president and chief executive officer, Roger Dumoulin-White.

Speaker #1: Roger, welcome and thank you for joining us today.

Speaker #2: Thank you, Matthew. It's a pleasure to be here today.

Speaker #1: Hello, everyone, and thank you for joining us. We sincerely appreciate your time, questions, and continued support of THERALASE. As we enter an inflection point in the evolution of our company.

Speaker #1: We've received a number of questions in advance of today's call, and I've taken the liberty of combining them based on their theme. I would now like to take some time to address some of the most commonly asked questions from shareholders.

Speaker #1: Question one: When will study two be complete? Enrollment and delivery of the primary study procedure is expected to be completed by the end of fourth quarter 2025 in all 90 patients.

Speaker #1: This will allow us to complete our 15-month follow-up by early 2027 and be in a position to submit a marketing submission to Health Canada and the FDA in the first quarter of 2027.

Speaker #1: Health Canada and the FDA take a minimum of six months to render a decision. If priority review is granted, so if we meet all of their guidelines, then marketing approval would be granted in the third quarter of 2027.

Speaker #1: If not, and it was stretched out to 10 months, approval would be expected in the fourth quarter of 2027. Question two: What is the estimated cost to complete study two?

Speaker #1: We estimate approximately 5 to 10 million Canadian is needed to complete enrollment, follow-up, data lock, and regulatory submissions over the next 18 months. Question three: Is THERALASE still pursuing a US listing?

Speaker #1: Properly capitalizing the drug and device divisions is the company's priority in 2025. As such, a US IPO listing is being investigated for 2026. To further capitalize the company, to accelerate our clinical development of numerous cancer indications.

Speaker #1: Question four: How does Ruvidar compare to other bladder cancer therapies? Ruvidar delivers high complete response rates with an ultra-high safety profile using a single intravesical treatment.

Speaker #1: No direct related serious adverse events have been directly related to Ruvidar or the laser system that activates it. Which differentiates its significantly from other more expensive and complex multi-dose immunotherapeutic approaches.

Speaker #1: Question five: What non-dilutive funding sources are you pursuing? We're pursuing short-term loans, interest-free debt, and grant financing support from a number of Ontario and Canadian-based government programs to help reduce shareholder dilution.

Speaker #1: We will provide more guidance on these vehicles if and when they become material. Question six: What is the next step for the new indications to move into the clinic?

Speaker #1: Good laboratory practices or GLP toxicology is the next step. Which will allow phase zero, one, two, adaptive clinical studies to commence for multiple cancer and viral indications in 2026, subject to regulatory approvals.

Speaker #1: Question seven: Will Ruvidar be commercialized in-house or through partnerships? Various options are being discussed at the moment. As our discussions and negotiations continue, THERALASE will decide based on a number of factors such as cost and time to develop, potential revenue, geographic territories, and market penetration.

Speaker #1: What technologies would be best to partner and what technologies would be best to develop in-house? With the primary decision matrix based on what provides the greatest shareholder value in the most expedient time span.

Speaker #1: Question eight: What is the shelf life and logistical advantage of Ruvidar? Ruvidar has demonstrated 10-year shelf life at room temperature which offers significant logistical and cost advantages for global distribution.

Speaker #1: Especially since the biologically proposed solutions of our competitors require complex drug preparation and administration. Along with expensive and time-consuming negative 80 degrees cold storage management.

Speaker #1: Question nine: How long do you expect complete response durability to last based on current data? We've seen complete response durability extend beyond 15 months in many cases.

Speaker #1: With 21% of patients who achieved a complete response still exhibiting this duration of response at three years and one patient demonstrating a duration of complete response for over seven years.

Speaker #1: Which is incredible. After only one treatment. As our clinical data continues to mature, these numbers are expected to rise. Question 10: Why expand into new indications now?

Speaker #1: Our small molecule platform has shown strong potential across numerous cancer lines. Diversifying the pipeline produces overall risk, expands our target markets, and hence increases our market revenue potential.

Speaker #1: Question 11: Are you in discussions with regulators? Yes. We continue to engage proactively with Health Canada and the FDA, as required, to ensure alignment as we move towards submission readiness.

Speaker #1: Question 12: What is your long-term strategic vision? To be a global leader in light and radioaction-activated therapeutics, delivering innovative, safe, accessible, oncology and antiviral solutions to patients worldwide.

Speaker #1: Which provide highly effective treatments and ultra-high quality of life. Are you in discussions with regulators? Yes. We continue to engage proactively with Health Canada and the FDA as required to ensure alignment as we move towards submission readiness.

Speaker #1: Question 12: What is your long-term strategic vision? To be a global leader in light and radioaction-activated therapeutics, delivering innovative, safe, accessible, oncology and antiviral solutions to patients worldwide.

Speaker #1: Which provide highly effective treatments and ultra-high quality of life. Question 13: Will FI Q3 require a shared consolidation to list in the US? No.

Speaker #1: We are pleased to confirm that we've identified a pathway to list in the US that does not require a shared consolidation. This removes a major hurdle and simplifies our roadmap to listing.

Speaker #1: It also reflects the strength of our current structure and supports shareholder continuity and confidence. Question 14: Are you pursuing any partnership opportunities? Yes. We are always pursuing potential partnership opportunities with some discussions—excuse me—more advanced than others.

Speaker #1: As outlined in previous communications, we are engaged in multiple ongoing partnership discussions, both for potential out-licensing opportunities and clinical collaborations. These span various geographic and therapeutic areas and reflect growing recognition of the value in our lead program and platform technologies.

Speaker #1: Question 15: Is there an update regarding bird flu? Yes. Based on our advances in bladder cancer and numerous other cancers, we have elected to move bird flu to the back burner at this time.

Speaker #1: We will continue to pursue this opportunity with a Canadian federal research institution in due course, but there's nothing material to report at this time.

Speaker #1: Question 16: Is there an update regarding your preclinical research at the University of Manitoba? Yes. FI Q3 has completed its research with Dr. Kevin Coombs at the University of Manitoba on the herpes simplex virus.

Speaker #1: And various other viruses resulting in a peer-reviewed publication which is available in a link posted in our September 24th press release. Titled, "Independent research demonstrates ruvidar effective in the destruction of herpes simplex virus." That seems to be all the questions the company has received to date.

Speaker #1: I look forward to answering additional questions in the future. Thank you. Thank you, Roger, for your detailed responses, and thank you to all the shareholders for your thoughtful questions, and continued engagement throughout today's discussion.

Speaker #1: We truly appreciate your interest and continued support at FI Q3's advances in clinical, financial, and strategic objectives. As we move through this pivotal phase of our development, the progress that we have achieved to date reflects the strong momentum achieved across our organization.

Speaker #1: This has reflected by our strengthening of our capital position, achievement of key milestones in our pivotal bladder cancer clinical study, and in the preclinical development of our new oncological conditions, which will all ultimately lead to increased shareholder value.

Speaker #1: With an expanded pipeline that now encompasses nine additional indications, FI Q3 is well positioned to become the next up-and-coming pharmaceutical company. The next steps we've taken over the past few quarters, and those that we are focused on in the quarters ahead, continue to differentiate FI Q3 within the biotech and pharmaceutical landscape.

Speaker #1: Thank you again for your time today, I replayed this call will be available in due course on our website. Have a great day.