Significant events during the second quarter

• Biovica signed an agreement with US Biotech company in clinical phase
• Biovica received a significant order for TKa testing services
• Biovica published the outcome of exercise of warrants from series TO3B.
• Biovica signed a master service agreement (MSA) with UK biotech company

Significant events after the end of the period

• New DiviTum® TKa data that significantly increases the market potential to be presented at SABCS
• Biovica signed an agreement with US healthcare and insurance giant
• Biovicas CLIA lab has obtained a permit from New York, which opens up the entire US market

Webcast:
When: 12/12 2024 kl. 15.00 CET
Where: registration via: Biovica Q2 Earnings Call, Thu, Dec 12, 2024 at 3 PM CET
Broadcast language: in English

CEO’s comments

Clinical use of DiviTum TKa in the USA continued to rise and sales during the quarter in the USA increased by 10% compared to the previous quarter. Although we are pleased with the increase in sales, some commercial activities have taken longer than expected, which has dampened our planned growth in 2024.

However, a major integrated delivery network (IDN) has started using DiviTum TKa, which is an important milestone for accelerating sales in the USA. The organization was evaluating DiviTum on a trial basis in 2024. Subsequent to the end of the quarter however, we signed a Client Billing agreement with them that enables us to reach a large number of policyholders. The IDN with whom we have an agreement has 10 million policyholders in the USA.

There are enormous benefits with DiviTum TKa as an effective tool for individualized treatment that can improve the outcome for patients and generate significant savings by lowering the costs associated with side effects and ineffective treatments.

The initial tests with DiviTum TKa have made a difference for patients involved during this trial phase, while contributing to a more effective use of resources for this customer. If continued use proves to be equally successful, the goal is for DiviTum TKa to become a standard test for patients undergoing breast cancer treatment who are policyholders of this customer. 

We have discussions underway in the USA with similar IDNs, where we have presented them with attractive offers and strong arguments about the significant economic benefits associated with widespread use of DiviTum TKa. Our recent agreement with this IDN serves as a very important reference.

One of the cornerstones for commercialization of DiviTum TKa is strong scientific support. It is thus very positive that 7 abstracts based on trials using DiviTum TKa were presented at the world’s largest, most important breast cancer conference, SABCS, in early December. There were more than 11,000 participants this year at the conference. The trial results reinforce how DiviTum TKa has value as a response indicator and predictor for patients with both metastatic and early breast cancer treated with CDK4/6 inhibitors, the most prescribed drug class for this patient population.

We are particularly happy about the strong results from the use of DiviTum TKa on patients with early breast cancer and the significant benefits it also offers for monitoring adjuvant treatment. This increases the total addressable market for DiviTum TKa in the area of breast cancer by a factor of 6, compared to its application solely for metastatic breast cancer. The new application is already covered by the code we have been assigned in the US payment system.

These research results with DiviTum TKa align with the FDA’s approval of the CDK4/6 inhibitor Ribociclib, which, since October 2024 is included in the guidelines for adjuvant treatment. It fuels the need for a product such as DiviTum TKa, which can more easily be tailored to patient needs also for adjuvant and early stage breast cancer. This is where DiviTum TKa has an important role to play by ensuring that the patient obtains the best possible treatment, while society and payers obtain the most efficient use of their resources.

We also made important progress in our business with pharmaceutical companies and sales in Europe during the quarter. We signed two Master Service Agreements and received our largest work order to date, for SEK 2.2 million. It is with a US-based biotech company focused on the next generation of CDK inhibitors.

Our portfolio for Pharma Services is growing each quarter, so we anticipate positive sales growth in this area over time. However, sales in this area decreased because the start of some planned trials has been delayed until 2025. We are striving to develop both our value proposition and business model so that we can more easily capitalize on the enormous potential of drug development, while minimizing the volatility of future income.

Efforts are underway in Europe to establish DiviTum TKa in the nine markets where we have agreements in place with partners. We sold DiviTum Kits to Italy during the period and are anticipating sales in additional markets soon. Our goal is to sign additional commercial partnership agreements in several more European countries.

Our cash flow improved by SEK 7 million in the quarter compared to the same period last year, which is attributable to the cost-saving measures that were implemented during spring 2024. We have achieved many important milestones, the most important of which is our recent agreement with the US insurance giant. But, all of it has taken longer than planned, so we are a bit behind on our forecast for becoming cash flow positive. We are thus in the process of revising our business plan.

The directed issue that we executed during summer 2024 resulted in a capital injection of SEK 16 million. Existing shareholders also demonstrated their continued trust in us by exercising warrants from the TO3B series. This generated funds of approximately SEK 20 million. We are also reviewing the best ways of funding operations in order to realized Biovica’s full potential. Thanks to all the progress we have made, there are many options and the contracts we already have with customers will increase the rate of sales growth in 2025.

It has been an intensive quarter, where my faith in the business potential of DiviTum TKa has grown even stronger. The new research results on early breast cancer, along with our new direct client contract with a US giant in healthcare and insurance are major steps towards realizing the potential. DiviTum TKa is enormously beneficial to patients, so our efforts to make it available to as many of them as possible, thereby maximizing value to all of our stakeholders, are accelerating.

Anders Rylander, CEO