Immunovia AB (publ) (IMMVF) Q3 2025 Earnings Call Transcript

2025-11-26 12:23:27 ET

Immunovia AB (publ) (IMMVF) Q3 2025 Earnings Call November 26, 2025 9:00 AM EST

Company Participants

Jeff Borcherding - Global Chief Executive Officer & President

Conference Call Participants

Niklas Elmhammer - Carlsquare AB, Research Division

Presentation

Jeff Borcherding
Global Chief Executive Officer & President ...

Good afternoon, good morning, and welcome to the Q3 interim report for Immunovia. I'm excited to speak with you today about the milestones we've achieved and the progress that we've made in our mission to save lives through early detection of pancreatic cancer. This is a really important quarter for us as it marked the transition from being a development stage company to being a commercial stage company, where we brought our PancreaSure test to the market and saw the initial response to that.

We have been very excited about the responses that we've received. Throughout this presentation, I'll try to share a little bit of perspective from some of our customers about the PancreaSure test. And here, you can see one of those comments from Dr. Raj Keswani, who works at Northwestern University, who is excited about offering this screening option to his patients. He calls out the fact that the test has a high sensitivity and a high specificity. And so it's a valuable option for their high-risk patients at Northwestern Medicine.

On today's call, we'll talk about the launch of PancreaSure and share some initial results. We'll also talk about reimbursement milestones that we've achieved and what lies ahead. We'll briefly cover the Q3 financial results and our cash position. And then I'd like to share a little bit more information about the AFFIRM clinical study that we announced results for a while back.

Just as a reminder, before we talk about the results of the PancreaSure launch, I thought it would be helpful to go back and make sure that we talked a little bit about the strategy that we're pursuing for the test. So one of the things we want to do is really build advocacy, build use among key opinion leaders who practice at the top high-risk surveillance centers across the United States.

One of the other things we want to do is make sure that we're smart about how we spend our money. We want to execute a very targeted low-cost launch that leverages our existing resources as much as possible so that our investment doesn't get ahead of our ability to generate revenue. As we think about expanding over time, that's where we want to bring in a partner. And so a lot of what we're doing in these early stages is demonstrating the potential of the PancreaSure test so that as we think about what the potential volume is for the test and the reimbursement potential, that potential is obvious to a potential partner for us.

And then finally, it's going to be critical that we continue to run lean, that we operate very efficiently and that we limit our expenses, looking for ways to automate so that we can scale without our expenses increasing at the same time. There's a quote from one of our customers, Ray Wadlow, who is a gastrointestinal oncologist at Inova Schar Cancer just outside of Washington, D.C. And it speaks to the fact that we are making a transition from the development stage to the commercial stage.

And as we do that, the fact that we've engaged so many key opinion leaders in our clinical program really sets the stage for us to succeed commercially. Dr. Wadlow was involved in our CLARITI clinical study. And in addition, his patients participated. He said that they're very excited now to use the test that is available in the market. And this is something that we've seen from multiple physicians who were involved in our clinical studies.

As we've shared previously, we will launch PancreaSure in 3 phases. And as I mentioned earlier, we want to increase our commercial investment as we start to approach and achieve reimbursement, so that when we start to generate significant volume, we're getting paid for that volume, and we're not investing money in generating too much volume that doesn't generate a lot of revenue. We'll go through 3 phases: Targeted advocacy, which will last until around the middle of 2026, a volume building phase that will comprise the end of 2026.

And then as we move into 2027, we will really focus on revenue growth as both the volume builds and we start to get reimbursement from payers. As we think about the first stage that we're in right now, just as a reminder, our objective is to build targeted advocacy. In this phase, we are targeting those key opinion leaders who practice and who screen for pancreatic cancer at top high-risk surveillance centers across the United States.

Our sales effort has been very, very limited at this point. We have not yet hired any salespeople. The sales effort has been completely done by members of the management team and I, reaching out to prospects, including both those who participated in our clinical studies, those who used our prior IMMray PanCan-d test and then others that we have met over the years.

A really important thing during the 3 phases of this launch is that the metrics that we use to evaluate our progress will change over time. So when we're in this targeted advocacy phase, our primary metric is going to be the number of high-risk surveillance centers that order PancreaSure. That's our key metric of success. Are we getting more and more of those top physicians, those experts in the field to raise their hand and say, "I want to use the PancreaSure test with my patients." That's a really critical metric for us, more important than volume, more important even than revenue.

Those things will come. But the first thing that we have to do is build that advocacy, because if we build that advocacy, that sets the foundation for us to grow the business going forward from here. I'm very excited to share our progress so far on that key metric. As of the end of the third quarter, we had 10 leading pancreatic cancer centers who had implemented PancreaSure, and that's just in the first month. If you remember, we launched the test on September 2. So in just those 4 weeks, we were able to get 10 centers registered and up and running ordering the test.

You can see some of the names here on the right-hand side of the screen. We can't disclose all of them. Some of these centers have a prohibition against using their names and sharing them commercially, but we are very excited by the fact that we've got a range of systems represented here. Some of them like Northwestern and Penn Medicine are top academic institutions.

Others like Hackensack Meridian and HonorHealth are community health systems that are not affiliated with an academic center, but do have a high-risk surveillance program. This represents the range that we want to pursue. And you can also see here a good geographic range. So we've got everything from the Northeast with Penn to the West with University of Colorado Health. HonorHealth is in Arizona and Hackensack Meridian, New Jersey.

So we've got a good geographic representation across the country. Again, that's important because we want to build advocacy overall, but also in specific regions within the country. I mentioned that our metrics will evolve as we move through the 3 phases of the launch. When we get into the volume building phase later on in 2026, that's when our primary metric will really become PancreaSure volume, and we'll start looking at revenue as we get into 2027.

It's not that we aren't focused on how to generate revenue. It's just that the most important thing that we can do in the near term to ultimately generate the revenue that we need is to focus on building that targeted advocacy. One of the things I think is important to understand is how does our testing process work? And what does that mean in terms of when a test order becomes a completed test and ultimately leads to a patient paying for that test.

So here, we have a simple flow chart that shows the fact that once a physician orders the test in our online portal, we immediately contact the patient to schedule their blood draw. That can happen the same day in some cases. In other cases, it may take us up to a week to reach that patient. Once we reach them, we schedule that appointment to have their blood drawn so that we can collect the sample. Sometimes that happens as soon as the next day. In other cases, because of that patient schedule, it may take a few weeks to get that appointment scheduled. Once the blood is collected, it's shipped overnight to our lab in North Carolina. And from there, it takes us somewhere between 2 and 10 days to run the test.

Running the test is actually quite quick, but we want to batch tests together so that we're not doing a small number because that increases our cost per test. By batching them together in larger batches, we reduce the cost per test, and we deliver the results in a reasonable time to our customers. As you see here, once we deliver the results to the provider, we send out the bill within a day to the patient.

And then from there, as you can imagine, it may take some time to collect the revenue from that patient -- to collect that payment. It can be as quick as the next day if they use their credit card to pay online. For some people, we need to send them a couple of reminders before they pay. So in total, what you can see is that we can, in some cases, go from a test order to cash collection in an ideal scenario as quick as about a week, and that's about as quick as we could do it.

But there may be other situations where it takes a few months or even longer. So that's just something to be aware of that we know this is a dynamic in this market, and we're planning accordingly. One of the other things that will impact how quickly an order turns into revenue is the fact that we give our physicians what we call future order functionality. What that means is that if a patient is in the physician's office, maybe they're having an MRI or they're having an endoscopic ultrasound. That physician may want to use the PancreaSure test. But in many cases, many of our physicians tell us how they want to use the test is at 6-month intervals in between that imaging that's done with an MRI or an endoscopic ultrasound.

So what we do is we give the physician the opportunity to place a future order while that patient is in their office, while that patient is right in front of them. That order gets captured in our system. And then we know once it's time for that order to happen, we go through the normal process where we contact the patient and schedule the blood draw. In some cases, that might lead to waiting to reach out to that patient for 6 months, which is probably most common.

But we've seen some future orders placed as far out as 9 months. So we know that this is something that ultimately will really bolster our results. It's essentially building a pipeline of future tests. While we're in the early days following launch, some of these orders are just going to take quite a while to work their way through the system.

Again, as we think about this targeted advocacy idea, I just wanted to share one last quote from one of our key opinion leaders. He works at New York University. He leads the pancreatic cancer surveillance screening program there. And Dr. [ Ganda ] talked about the fact that NYU is a major network of hospitals with different levels of access to cancer screening across their system. In fact, one of their sites is actually down in Florida and treats New York residents who are in Florida at different parts of the year.

Because PancreaSure is a simple blood test, NYU can use our test to expand the access within their system. Previous research within NYU shows that only 1 in 5 people who is eligible for pancreatic cancer screening is actually getting screened. A big part of the problem is access to the imaging approaches that have always been the standard of care for pancreatic cancer surveillance. By giving them a blood test, we give them a new option. And one of the things that's especially as exciting is that we've been working with Dr. Ganda on the initial setup, and that setup has been in the New York area.

We actually had one of the physicians down in Florida who practices with the New York University practice in Florida, reach out to us proactively, not even realizing yet that the New York group was starting to set up this program and said, we'd really like to take advantage of the PancreaSure test. How do we get set up to use it. So I think that speaks to the fact that there is a clear demand for the PancreaSure test.

Moving on then from our launch progress. Let's talk a little bit about reimbursement and the milestones that we've achieved and what lies ahead. If you think about getting reimbursed for a diagnostic test in the United States, there are really 4 elements that come into play, and we refer to them as the 4 Cs: Code, Cost, Coverage and Contracts. A Code is the billing code that's used to identify a test. This really facilitates the reimbursement and billing process when we send a claim to a reimbursement or an insurance company and ask them to reimburse us.

Cost refers to the price of the test, and that's really determined by the clinical lab fee schedule, which is set by Medicare, a government agency. Coverage is the payer's determination that the test is reasonable and it's medically necessary. Essentially, what they're saying with coverage is we believe that this test adds value for the patients who are covered by our insurance plan, and therefore, we're going to pay for our patients to have this test.

And then Contract is something that happens with commercial insurance companies where we enter into a contract, it really sets terms of payment and really ensures that the process runs smoothly. If you look at our progress across these 4 elements, what you see is we've made very good progress in 2025. Earlier this year, we received our code, and that code is effective as of October 1, 2025. I'm also very excited to share literally just late yesterday, we received notice from Medicare that they have set the final clinical lab fee schedule rate for the PancreaSure test. They've set the rate at $897, which means that when Medicare reimburses us in the future, that reimbursement will be $897.

We're excited about that rate. We think that it really fairly reflects the value of our test and reflects the clinical and economic impact that we can have and that Medicare expects us to have on the people who use the Medicare program. The next step is coverage, and we don't have coverage in place today.

And the key there is to complete and publish the clinical studies that show that medical necessity that prove to Medicare and prove to commercial insurers that this test is something that should be included in the physician's approach to early screening for pancreatic cancer.

Let's talk a little bit more about coverage. So to prove medical necessity and secure coverage, we've got to generate 3 types of evidence: analytical validation, clinical validation and clinical utility. Analytical validity means does the lab measure the biomarkers accurately? It's essentially a very lab-focused measure of are we for the 5 biomarkers in the PancreaSure test accurately measuring the level of that biomarker in the patient's blood.

You can see that we've completed our studies there, and we're actively pursuing publication of that study. Next is clinical validation. And clinical validation essentially means if you're given a blood sample and you run the test, can you accurately distinguish cancer from a sample that doesn't have cancer. So you're likely familiar with the results that we've announced previously from the CLARITI study and from the VERIFI study.

On today's call, I'm going to share with you results from a third study called AFFIRM. We have just had the CLARITI study published. It was published in the Journal of Gastroenterology, which is really considered the premier journal in gastrointestinal disease. And one of our key opinion leaders who publishes extensively said he was incredibly surprised that they selected a diagnostic test to publish an article in gastroenterology.

He said it really speaks to the quality of the CLARITI study and the promise of the PancreaSure test. So for analytical validity and clinical validity, we have excellent data, and we're largely ready to submit that to insurers. The key is just making sure that everything is published. Clinical utility is the final part of the clinical evidence package that we need to generate. We currently have 2 clinical utility studies underway. These are studies that are being funded by the National Institutes of Health of the U.S. government. So there's very minimal cost to us.

But we're looking to conduct additional studies in 2026 and beyond. Why additional studies? Well, there's a couple of reasons. One, the 2 studies that are underway will take a few years to complete. So we want to have some clinical utility studies that can be done more quickly. That's why we'll be doing survey studies that we can complete in the first part of 2026, so that we can submit them as evidence of clinical utility in 2026.

Another reason that we want to show or demonstrate clinical utility across multiple studies is that there are multiple ways that the study can -- or that our test can show value. Clinical utility basically means do you impact physician decisions and/or can you improve patient outcomes based on using the test?

And there are, as you can imagine, multiple ways to show that because the test is used different ways. So for example, if the test is used to evaluate pancreatic cysts for patients who are going to surgery, that's a different kind of clinical utility than if that test is used in someone who has a family history of pancreatic cancer and they're being monitored over time to identify cancer as quickly as we can.

So we want to do multiple clinical utility studies so that we really build out that body of evidence. As we now switch to the Q3 financial results and the cash position, we are excited to share that this was a solid quarter for us from a cash flow and financial results standpoint. We had net sales of SEK 101,000. That was almost entirely royalty revenue.

As we discussed earlier, it will take quite a while for orders that were placed in September to actually generate revenue. So we don't expect to see that for a little while here. That revenue will come more in 2026 as we ramp up our volume and as we start to realize that revenue as patients work their way through the testing process.

Our operating loss for the third quarter was SEK 25.5 million. Importantly, as we approach the launch, we also look for any way possible to conserve cash. So our cash burn was reduced to SEK 5.4 million per month, and that's well below the guidance that we have had in place of SEK 8 million to SEK 10 million per month. I do want to highlight, as we move forward with the launch, we certainly expect to go back more to that previous guidance level of SEK 8 million to SEK 10 million, but we wanted to do everything we could to preserve cash prior to the launch.

At the end of the third quarter, our cash was SEK 26.6 million, and that was bolstered by a bridge loan that we had received during the quarter. As you recall, our cash position was bolstered by a successful rights issue. That rights issue actually completed after quarter end, but we were very excited with the way it played out. We were excited that guarantors were interested in guaranteeing the rights issue to 100%, even more grateful and excited that 87.9% of rights issues were subscribed.

That really, I think, speaks to the support that we've received from shareholders, and I want to express how much I appreciate that. I know that it's been a difficult ride as a shareholder and appreciate the continued trust that you have placed in us. Because of that trust, we were able to raise just over SEK 100 million which resulted in a net cash infusion of just under SEK 70 million when you account for the repayment of the bridge loan that I mentioned.

And that cash will take us into the third quarter of 2026. We'll use these funds to fund the commercial launch and also those clinical studies that I mentioned earlier in the clinical utility arena. Finally, before we wrap up and transition to questions, I want to share the results from the AFFIRM clinical validation that we recently completed. The AFFIRM study comes after 2 prior studies.

You'll remember that we did the CLARITI study and the VERIFI study. Those were both intended to show that we could accurately detect Stage I and II pancreatic cancer when you were looking at that cancer compared to high-risk controls. So control samples from people who have that familial or hereditary risk for cancer, people who have pancreatic cysts that put them at risk for cancer. And so can we distinguish in between those 2 groups? The CLARITI and the VERIFI results showed we absolutely could.

We had very strong sensitivity, meaning that we could detect cancer as well as specificity, meaning that we didn't have a lot of false positives where we returned to positive result when there really wasn't cancer there. One of the questions that we got from physicians after those 2 studies was, we understand the fact that you focused on Stage 1 and 2 for early detection. That's really important. But are you certain that if a patient has Stage III or IV cancer, you will detect it.

So that was one of the key questions we wanted to solve or wanted to answer. Another question was, how would the test perform in a normal patient population, meaning those people who are not at high risk. That's important because many of our competitors in the early detection space have historically used normal patient populations as controls. What happens is it's easier to avoid a false positive if you use those normal patients as your controls.

So we wanted to have the data that allowed an apples-to-apples comparison between our test and for example, some of the multi-cancer early detection tests that are out there. We were thrilled with the results. They turned out exactly how we would have hoped. So PancreaSure showed excellent sensitivity, 10 percentage points higher in Stage III and IV cancer compared to the sensitivity that we showed in Stage I and II. If you look at the VERIFI and the CLARITI studies, on average, we were able to detect about 78% of Stage I and II cancers.

And in the AFFIRM study, where we looked at Stage III and IV pancreatic cancers, we detected 88% of those cancers. So literally 10 percentage points more. Similarly, we saw excellent specificity even higher than what we had seen with the high-risk controls. We showed 98% specificity in those healthy controls in the AFFIRM study. So this data adds to the body of evidence that says PancreaSure is a very accurate test.

The fact that it becomes more accurate as a patient moves through the stages of disease shows that our 5 biomarkers really are detecting cancer and increasing or decreasing as cancer comes to be in a person's body and over time as that cancer grows and develops. So another excellent set of clinical data that really gives us confidence in the test itself.

With that, I'm excited to see if there are any questions. We can certainly take questions for the call in as well as you can ask questions using the chat feature as well.

Read the full article on Seeking Alpha

For further details see: