Genedrive (LSE:GDR) — Investor Presentation

0:02 And the Given the significant number of investors on the call today, the company may not be in a position to answer every question it receives during the meeting itself. However, the company will review all questions submitted today and publish responses where it is appropriate to do so. These will be available via your Investor Meet company dashboard, and we will notify you by email when they are ready for you to review. I would also like to remind you that this presentation is being recorded.

0:48 Before we begin, we would like to submit the following poll. And if I could encourage you to give that your attention, that would be, most kind. Thank you very much indeed. And I'd now like to hand over to Matthew Fowler, CFO and David Budd, CEO of GENEDRIVE PLC.

1:04 Good morning. Good morning, Mark. Thank you for the introduction, and, good morning, everyone, and welcome to GENEDRIVE's Interim Results Presentation to December 2020. The presentation covers the first half of our fiscal year and updates since the period end, covering a time of tremendous change in the company during which new significant and exciting opportunities opened up to us, while some of our traditional activities experienced some development headwinds from the pandemic. During the period, we made significant advances in our assay menu, in our instrument and software capabilities, our commercial partnerships, and consequently, our ability to serve significant markets, all aiding our goal in advancing diagnostics to the point of care.

1:54 The presentation begins with a standard investment disclaimer. But as normal, we choose to point out the key aspects of paragraph five there. Presentation is a review, but it does include statements that are forward looking statements. And by their very nature, they do involve risks and uncertainties because they relate to future activities that depend on circumstances that the company may not be in full control of. So we do communicate milestones to you based on the information that we have and that we believe to be true at the point in time. Presentation itself is posted in its entirety on Investor Meets Company website as well as the GENEDRIVE PLC website. So you don't need to do screen captures or anything. You can download it there following the presentation.

2:44 So as Mark mentioned, my name is Dave Budd. I'm the Chief Executive Officer here at GENEDRIVE. My professional experience is aligned in all respects to the goal of the company with international experience in both molecular diagnostics and point of care diagnostics. I'm joined today by our Chief Financial Officer, Matthew Fowler, who has a strong background in health care and related manufacturing industries. Matthew and I will share presentation responsibilities today. I'll take you through an overview of our development and commercial progress, and Matthew will review our midyear financials and relevant developments since then. Our strategy as company has been really quite consistent as we leverage our point of care molecular diagnostic instrument into discrete opportunities that benefit from immediacy of testing or by the availability of an affordable molecular testing solution outside of the traditional hospital testing lab.

3:43 For those of you that have not previously seen one, you can see here on the slide a picture of the GENEDRIVE instrument. It's a small, easily transported device that can serve as a much better alternative to larger benchtop instruments in many focused assay areas. Historically, the company's focus was almost exclusively in low and middle income markets. But over the past three years, we have broadened our focus to include more so called global market products, where we now have a range of unique products, including our high throughput ninety six SARS CoV-two test, a range of products for the U. S. Military called BioPlex and the world's first point of care antibiotic induced hearing loss assay, which we're in the process of introducing this year.

4:33 So existing investors will be familiar since our last presentation around our test portfolio. We currently have four different tests on market and a further two in development. With the products on market, the GENEDRIVE 96TARS COG2 kit is distinct in that it doesn't run on the actual GENEDRIVE instrument platform. It's a stand alone, fully formulated freeze dried PCR test in a 96 well plate format, compatible with three and soon to be four third party PCR instruments. Much of the company's focus was on the development of this product over the course of last year and bringing it to market in conjunction with its distribution partners. The pathogen detection products are a suite of tests, which I mentioned we call BioPlex, which has been designed and manufactured for military use by the United States Department of Defense.

5:27 We had expected at this time to enter into a new supply contract with the government, but that has been delayed, we think, just because of COVID and the DoD's focus on that. The company recently announced a new distribution agreement with U. S.-based Mountain Horse Solutions. The purpose of this distribution agreement really is to expedite the procurement processes for the BioPlex with the DoD and to return orders and revenue back to GENEDRIVE as quickly as possible this year. The third test is our antibiotic induced hearing loss kit, a test we're extremely proud of and represents the world's first rapid molecular point of care test for a neonatal intensive care setting.

6:13 Test is used to screen babies for a genetic mutation that can cause deafness when they're administered antibiotics. And then the fourth area is the GENEDRIVE hepatitis C ID kit, which is used for the qualitative assessment of HCV infected patients. It's targeted at low and middle income markets. It's CE marked and it's distributed via SISMX and ArcRay into India, Asia Pacific and Africa. I think in 2020, the product experienced significant headwinds as the world health care systems focused almost exclusively on combating coronavirus. And then in development remains two kits, which run on the GENEDRIVE platform.

6:58 The first is our point of care version of SARS CoV-two, which we'll be updating you on during the presentation. And the second is the GENEDRIVE point of care test for molecular diagnosis of tuberculosis infection. And development of that product has effectively been paused during this reporting period due to the focus of our resources on GENEDRIVE COVID-nineteen products.

7:27 So I'll now take you through our programs for the development period up to December and any significant advances that we've had since that point in time. So the first product to review is the GENEDRIVE 96 SARS CoV-two kit, which, as you know, consumed much of our time and energy in 2020. While frankly, utterly simple in concept, in reality, it is a very complicated product for the company to bring to market and develop. The product uses a combination of GENEDRIVE and CITIVA intellectual property and know how to produce a ready to go PCR formulation in a 96 well plate. It comprises three distinct part numbers for different PCR platforms and require the development of an interpretive software package, extensive clinical and performance validation of all these various combinations in order to CE certify it.

8:29 Very positively, we demonstrate excellent performance for this product, whether used manually or used in automated RNA extraction instruments. We have some performance data in the presentation to share with you, but it's fair to say that the product is performing as we expect in many independent evaluations. What has frustrated our commercial progress are much slower regulatory processes than we would have anticipated when the product was launched. Globally, the regulatory agencies have been overwhelmed, frankly, by suppliers trying to get their product into market. And 99% of these are sort of me too reagent kits of liquid components that require formulation by the labs on-site. And they don't possess any of the finesse, ease of use or the ingenuity presented through the GENEDRIVE solution.

9:18 But regulatory agencies have been unable to keep to their own timelines and consequently aren't delivering time commitment to companies in which their submissions will be reviewed. We do regularly try to prod and push regulatory agencies along to try to advance our application. And it's fair to say, while they are overdue, we are being very diligent in pursuing them. The reality is, is that we have an excellent product poised to go into markets with distribution companies eager to serve customers, but we do remain paused in many regions.

9:54 India has been a slightly separate case, and we have had constant back and forth with regulators to the point that we have even created an India specific product for that market with its own distinct labeling packaging, fully aligned to the documented requirements of that country's needs. However, we are continually countered with new requirements or objections from different individuals or different offices for some additional test requirement or data. And although I think it's not in our benefit to go into huge detail here, but if we don't feel that this can be positively concluded, and if we don't believe, frankly, that regulators are interested in approving products that bring innovation, at some point in the near future, we'll devote our time elsewhere.

10:48 I mean, just in the past few weeks, we received regulatory clearance in Thailand off the back of rapid and successful independent performance assessments in that country and consequently have appointed a new distributor to begin commercial activities there. So clearly, in market approvals can be performed and can be achieved. On the commercial front, because of the delays in regulatory approval in major markets, we haven't got to where we want it to be. However, the company has significant opportunities in the funnel, which we're working to realize. In December, we communicated an opportunity with a European Ministry of Health, which although we would have thought should have concluded months ago, can report that it remains absolutely viable opportunity for the company. And we are still hopeful that it will come our way in due course.

11:41 The second large opportunity that we're working on in the company now is managing our new distribution arrangement with Beckman Coulter Life Sciences. And although, undoubtedly, we will experience similar regulatory headwinds in The USA as we don't have emergency use authorization yet, the FDA does allow you to import and sell products while your application is pending. So we'll need to focus on the segment of end users that don't require EUAs and are interested in the validation data that GENEDRIVE and Beckman have developed together and the possibility to automate these solutions on a laboratory robotic system. So Beckman's rolled out sales responsibility for our products to their sales teams, selling RNA extraction chemistry as well as their sales teams selling Biomec automation.

12:33 And they're conducting an aggressive marketing and lead generation campaign at this early stage of our agreement.

12:45 This is just a selected overview of some of the external studies that have been done with our kits. These include labs in The United States, in Spain, Italy, and within Africa as well. They're all independent labs, and none of this data is reflective of data that was generated for regulatory submissions. If you look through them, you can see there is some small variation in results, which you would expect because labs collect samples by different methods, and they perform tests in slightly different ways. And in each of these studies, we're actually compared to a different test that, in its own right, has got variable performance. But performance wise, whether it's in our own hands or it's in independent hands, the test is working well, and we demonstrate that. A simple review of online literature will quickly show you that this data, as we said when we launched it, remains in a top tier of real world performance.

13:46 Now our distribution with Beckman Coulter Life Sciences represents a very significant opportunity for the company. I don't think it should be understated how important a relationship with a company of Beckman Coulter's size could ultimately be for GENEDRIVE. Beckman has the financial capabilities, distribution and sales reach, market knowledge, and end user contacts that we simply do not. It also has the capability to focus its organization on this as a priority, and that generally gives us the confidence that this could build into something very meaningful. Our relationship began through a development and cooperation agreement in the summer of twenty twenty, evolved into a distribution agreement at the end of January twenty twenty one based on the generation of good performance data and, frankly, just a really good positive experience in working together.

14:40 And I can genuinely say that Beckman has taken the opportunity very seriously. It placed its first order with us approximately four weeks ago for around USD 400,000, which it's using for evaluations and to fill up its sales funnel. Now, we do recognize there is a sales cycle required for new customers or to convert customers already using someone else's kit as well as a lead time for the supply, delivery and installation of BioMex systems. So in my mind, it's still very early days, but it's apparent that Beckman is absolutely engaged and focused on delivering sales. We are very pleased to have them partner as our first entry point selling GENEDRIVE products into The United States.

15:35 Moving on to point of care, we have made a lot of very positive progress in the development of a point of care diagnostic test for SARS CoV-two over the past month. Now ultimately, type of test that we're trying to develop is complicated. It's multifaceted. It involves the development of a new reagent system, potentially new hardware components, certainly new software. And because our tests are freeze dried, an additional work stream, so to speak, of working with an external company in developing a robust manufacturer around these new reagent combinations. Now we believe that a point of care COVID market will be here for a long period of time.

16:25 The market's currently being supplied, as you see as an example here in The UK, with inexpensive but quite inexact lateral flow tests designed for mass population screening. And these types of tests really to be used for a diagnosis purpose often requires confirmatory PCR testing because PCR is much more accurate. But, you know, proper molecular point of care testing offers the possibility for rapid, highly accurate testing, whether that's in a focused health care setting or for confirmation of less precise tests in environments like schools or or office or occupational settings. But tests need to be rapid, need to be accurate, need to be sensitive, and and they also need to be reasonably priced.

17:12 Right? Now the product that we have is still in development. And we're following actually two parallel paths. So in December, we announced a direct from saliva test method that generates positive results in around fifteen minutes and negative results in twenty minutes. So that would compare to in lab PCR tests, which are typically between an hour and a half and two hours. Subsequent, we've also moved on to a swab based workflow that promises in some way to be even more impressive.

17:46 A key driver in the saliva test development is ensuring biosafety, which means not exposing the operator to any potential infection, which is a significant hurdle in most tests available either on market currently or in development because you need to open up a sample container in order to get at the sample to test. But in order to overcome this, we are using an inactivated or inactivating CO2 COB2, reagent during the virus collection process. So our assay is a two gene assay, unlike those provided by Abbott or Lumira or Optogene. And the reagents can be lyophilized or freeze dried for room temperature storage. So our initial rapid progress was slowed a bit, frankly, by differing performance of the assay in saliva, depending on which available model virus we use to test the assay. So when you're developing tests, you're typically doing it against synthetic virus strains rather than real virus strains, really just through availability of samples and also safety for the people doing the development. But this isn't an unknown phenomenon, but it's critical that we have to have a rigid and repeatable framework or benchmark, not only which to drive development against, but ultimately against which to manufacture.

19:08 So work here continues with probably a three month delay or so. But as we say, we believe that the point of care COVID testing market is growing, it's evolving, and it'll continue to do so for the foreseeable future. This is a market that's here to stay. The second development path that we're following is based on swab testing. And it's similar to the workflow that we use in our antibiotic induced hearing loss test. So we've demonstrated a rapid molecular test that can achieve high sensitivity, higher than we can achieve in saliva, and analytical time to result in circa ten minutes, just faster than competitive systems, all while maintaining biosafety and multigene targeting, which really is really important as we see and we hear about the emergence of viral strains and viral mutations.

20:04 We will, of course, keep you updated as development progresses. But in either case, we're focused on a Q2 twenty twenty one release for first product availability of one of these solutions and then moving on to a subsequent version that will allow us to use CITIVA B technology because that allows us to do things very inexpensively and also rapidly scale production capability. So in summary, for our two GENEDRIVE COVID-nineteen projects, we do recognize the frustration and delays related to commercialization because, frankly, we share the same frustrations. Delays have, in the main, chiefly been related to registrations, of which we have a limited control. But we have developed a unique product with very compelling features.

20:53 We can demonstrate and have demonstrated excellent performance in the field, And we've aligned ourselves now with blue companies such as Sysmex and Beck and Coulter to take us to market. Our product to date has been shown to be unaffected by the major variants that have been detected around the globe. And these variants will affect the efficacy of vaccines, and they will affect how the virus spreads around the globe. We have an active, significant funnel of opportunities at hand, which we hope we won't have to wait much longer to realize. And our point of care test is being developed to retain a set of really competitive advantages, principally in terms of speed and biosafety, which I think will hold the company in really good stead moving forward.

21:41 So having said the majority of the presentation now on COVID, we have three more slides covering our antibiotic induced hearing loss test, our military application, and briefly, we'll touch on our hepatitis C test as well. But for those of you that have had the opportunity to listen to discussions about this previously, you'll know that the team at the company and myself personally are very passionate about the opportunities in our antibiotic induced hearing loss test. Not only is this test unique to GENEDRIVE at the point of care, but it's professionally very rewarding to see

22:16 the impact our efforts can make in the life opportunities of so many young children. The product works by taking a swab of cells from the baby's inner cheek, adding that sample to the GENEDRIVE MT RNR1 cartridge, and then analyzing it in the GENEDRIVE instrument. The mutation affects around one in five hundred babies. So in practice, this is a screening assay where all babies get tested, looking for the few that carry the mutation. Those that can be given an alternative antibiotic are once a mutation is found. There is around eighty thousand babies a year born in The UK that are given antibiotics shortly after birth. So it'll give you a proxy value of the market in Europe and The US of around GBP 35,000,000 to GBP 50,000,000, depending on price and route to market.

23:08 Now our NHS partners in Manchester and Liverpool worked really diligently in 2020 to complete a large performance evaluation of this product, which sought to determine if this type of technology could be implemented in a neonatal health effectively. And I think it really was heroic work on the part of the clinicians and the nurses to get even close to the endpoint of one thousand admissions during the study period when most health care resources were being rediverted to COVID, in fact, even visiting hospitals by companies such as ours was banned. So the study itself was hugely beneficial for us, delivering a lot of very valuable feedback on our product design.

23:55 On the slide, you'll see an image, a small image on the bottom left of a new version of GENEDRIVE, which incorporates some of the changes that we picked up as a result of the study and we're now designing in for future release. So this includes an integrated touchscreen, a lock in cartridge position port, electronic results, excuse me, transmission, and the provision of independent positive and negative standards for training and assessment of users. And this fully integrated version ultimately will be the product that we commercialize globally. We continue to work actively with Inspiration Healthcare, who's our distributor in The UK and Ireland for our AIHL product. We're working with them and their network of key opinion leaders to establish some early adopter accounts, which we're planning for summer twenty twenty one.

24:47 As I mentioned previously, we will take the product to Europe on the back of our CE marking work. But ultimately, we'd like to be able to take this product to The U. S. As well because we believe that that market has not only the clinical and financial drivers, but the legal and litigious drivers that make the adoption of this type of product in the market very attractive.

25:12 GENEDRIVE's pathogen detection products. The BioFlex was developed in conjunction with the US military over a period of approximately five years and generated around US10 million dollars of income for the company. BioPlex tests are able to rapidly detect multiple pathogens that could be used in a bioterrorist attack, basically at the site where the testing is required. So no other portable systems currently approved for the same targets set by the US DoD. The development project was successful. We've developed a highly specialized and specific tactical unit for the DoD that offers GENEDRIVE a high margin product in a potentially large marketplace. Post development, we spoke about a potential new customer opportunity within the DoD, and it was anticipated that by this point, we would have a new commercial contract in place with the military.

26:08 But again, COVID headwinds have not been in our favor. We didn't have the feet on the ground to make a meaningful impact on their buying behaviors. So post period end, we established a new commercial distribution agreement with Mountain Horse Solutions, who are out of Colorado. Mountain Horse is a specialist U. S. Military supplier with existing established contracts in in the procurement processes of the DoD. So the original potential buyer that we talked about is still very much in the frame. They've continued to test and trial our system, and we're hopeful that Mountain Horse will help

26:44 us close this opportunity faster. Basically, way it should work is the military would contact a company such as Mountain Horse, for example, could specify them to assemble a certain number of field deployable kits, as they call them, or packages under an existing contract framework. So they might call up and say, look, I need, I'm just making these numbers up, 55 kits containing two gene drives, 400 cartridges, a water purification system, 200 environmental testing filters, etcetera. And Mountain Horse, in turn, would then be responsible for assembling all of that, procuring all of those things, packing them into deployable kits and delivering those products for the U. S. Military wherever they happen to be around the world.

27:33 And they have an existing contract framework in order to do that. And that's really essentially how it can ultimately benefit us. Mountain Horse with stock product, that avoids protracted contract framework negotiations. And they have the DoD decision making contacts to expedite the business opportunity. So their business model really is to take a small margin off both the buyer and a little bit from the seller as well. And to be fair, we're not giving much margin away for what I would consider to be really significant benefit. So we're very pleased to be in this new arrangement with Mount Forest.

28:10 And we're hopeful that, obviously, that will lead to a faster procurement cycle of GENEDRIVE within the U. S. Military and also by their commercial capabilities allow us to promote and sell more broadly within the military organization.

28:28 And my last slide for the moment before I hand it over to Matthew is on our hepatitis C ID kit. This is designed to detect and diagnose individuals that are infected with hepatitis C, and determine if they're eligible for treatment with direct acting antiviral drugs. The product was the first to market qualitative point of care test, and it is pre qualified by the World Health Organization. And as we previously communicated, our progress in this product last year was very much hampered by COVID. And I think it's not really possible to overemphasize as a health care company how many existing work streams, existing rates to market were impacted by COVID last year.

29:19 That said, it is very good to see in recent months some green shoots around HCV with additional activity, mostly in Africa through Suspects, which again, it's really good to see and see their focus on that product. A very large independent external study was completed last year in Cameroon in Georgia, and that's expected to be published in the next few months. Results were very positive, showed excellent product performance in the overall situation. So we will, of course, make you aware when we see that ultimately being published and available for review. Okay. So at this point, I'd like to hand over presenting responsibilities to Matthew to go over the financial summary up to your mid year in December.

30:12 Thanks, David. Okay. So I just have a couple of slides here on the financials. I'm mainly going to focus on cash. But first of all, I'm going to run through the income statement and the balance sheet. So with regards to the income statement first, revenue slightly down on prior year, $3.55 versus 06/27. And the current year revenue or current period revenue mainly relates to the USDOD that David's already spoken about. Operating costs for the period were pretty much in line with the prior, giving us a loss of just under 3,000,000. Below operating costs, there's a large credit of GBP 3,600,000 in finance costs. This credit is related to the conversion of the BGF loan notes in autumn of twenty twenty.

30:59 This conversion, accounting wise, creates a large credit to the p and l of this 3.6, which when you add to the operating loss, gives us a profit before tax of nought 600,000. I then make an estimate of tax for the period, a tax credit of 370, giving a profit after tax of GBP $9.91. Moving down now to the balance sheet. The most notable movements are the inventory growth and trade payables decline since June 2020. And this is all related to our stock build in the summer of twenty twenty. So you remember that following our fundraise, we procured some key enzymes to guarantee our ability to supply. So this procurement was in inventory and creditors at June 20 and has moved across into full inventory at December 20 with payables being paid down.

31:49 The other notable balance sheet movement relates to the convertible I mentioned a moment ago. The GBP 11,600,000 liability at June 20 was extinguished on conversion with a £3,600,000 credit to the P and L and an £8,000,000 credit directly to equity reserves. The net accounting for the conversion, therefore, has helped push our balance sheet position from net liabilities of And And a past. The of six monthly run rates. So we've got the six month period to December 'nineteen, six months June 'twenty and six months December 'twenty to show comparable run rates.

32:39 You can see from this slide that the operating losses are pretty consistent, GBP $29,000,003,000,002,600,000. However, underneath the operating loss, you can see working capital has consumed GBP 1,200,000 in the six months of December 2020, which is a big change from prior periods. This working capital movement goes back to my comments on the balance sheet. It's related to the stock build and securing supplies for COVID over the summer. There have been a few questions on working capital, so I'd just like to expand on that stock position. So overall, I'd say we sit very comfortably with our inventory and have secured sufficient components or critical components for relatively high volumes of sales in the short to medium term. It's worth noting that given the relatively high margin of the product finished product, the working capital requirement here is not as large as it could be. And also worthy of saying that the enzymes have pretty long shelf lives and are used across almost the range of our products. So that makes it quite simple to manage, and we have good forecastability and good understanding of those supply lines.

33:45 Below working capital, not a huge amount of movements, but two items of note. So we submitted our R and D tax claim in November 20, and we're still awaiting our cash payment of £1,000,000 In the prior year, December 19, we received our cash in a much shorter time frame, hence, we received that $971,000,000 No concerns over collectability. It's just timing and admin process.

34:10 And on chasing, we hear the problems and issues of home working and COVID causing delays. And secondly, to note in the cash flow, the interest payable of GBP $370,000,000. This was related to the conversion of the loan notes, and this is interest owing on conversion that we'd previously been deferring. So our cash consumption for the period was GBP 4,400,000. And when added to opening cash, gives a closing position of GBP 3,800,000 at December 2020. To bring this cash number up to date, as of the March 15, so a little over a week ago, the cash position was GBP 2,800,000. And at that point, it still excludes the r and d tax credit of a million and our most recent sales. So which would add about another 400,000.

34:55 So the sort of quasi cash, where if I was to add that in, means that we're sort of sitting at around 4,200,000 fully collected. And in terms of burn rate, after high consumption over summer, again, back to that stock build, we're currently back down to a more normalized burn rate of about 400,000 per calendar month. So with that stated quasi cash number of 4.2 and a burn rate of 400,000, you can kind of gauge the cash runway, with the additional caveat that the summer stock world has left us in a very comfortable position to service any demand in the very short term, and we don't see cash flow issues arising from overtrading. Okay. So two brief slides on the financials, expanding on the impact of that low note conversion and hopefully bringing things right up to date in terms of cash and cash flows.

35:43 Okay. Thank you very much, Matthew. Last slide before we go on to question session is just news flow, what you expect to see us coming out from the company in the next sort of six months, mid midterm and longer term. And it really just covers the key elements that we've talked about today. We expect in the shorter term to be updating you on our European Ministry of Health opportunity registration updates, whether that's or significant registration updates, FDA, WHO, India. Launch planning for our GENEDRIVE SARS CoV-two point of care test in Q2. And then going into the summer, commercial launch of our AIHL and initial sales from that.

36:28 In the medium term, we hope we'll get to a point with Mountain Horse that we can confirm an order rate, overall size and the combination of number of assays used per device for the military BioPlex opportunity and then moving on to Version two of our GENEDRIVE point of care device, where we'll be able to leverage the Zytiva B technology. Overall, these things lead into our three year objectives. We expect that our SARS CoV-two point of care, it will continue to provide revenue into the company into the future. We don't think that this is a product area that will go away. Successful traction in AIHL and The U. K. And Ireland will lead us to expansion into other markets. And as we mentioned, The U. A. Is in scope.

37:16 And once the world calms down a little bit, we're able to get back to our tuberculosis product, get that out the door and launched and developing additional pipeline with additional markers as we try to drive GENEDRIVE product to the point of care. So, I'll stop at that point, and we'll go over to questions, some of which were submitted in advance and some of which which you have the opportunity to submit live. Matthew, David, thank you very much indeed for your presentation. Ladies and gentlemen, please do continue to submit your questions using the Q and A tab situated on the right hand corner of your screen. But just while the company take a few moments to review the investor questions submitted today, I would like to remind you that recording this presentation, along with a copy of the slide and the published Q and A, will be available on your investor Meet company dashboard, and we will send you an email to notify you when they are ready for your review.

38:17 Firstly, thank you to investors that took the time to pre submit questions and just given the number of questions that were pre submitted ahead of today's event. We're going to kind of put them into a couple of categories at the beginning, but the company has reviewed. And as I said, we will publish responses to those questions to everybody on this call this morning. On that basis, if I could perhaps, obviously, David as well and Matthew, obviously, during the live event, investors question. If you could say who it's from and give a response where it's appropriate to do so, that would be great.

39:05 Right. So without no further ado, and I am mindful of time and and using it as wise as we can. The first kind of theme was around working capital requirements. This question here, I guess, encapsulates most of the content and the others is what are the working capital requirements to scale production to meet demand from across lab based PCR coding tested, POC based COVID testing, AIHL rollout, and potential DOD and HCV orders as they land through in 2021. Perhaps I can hand that over to you, Matthew. Okay. So I Okay. Thank you. I think I covered a bit of this just just now when I talked about the the stock build, clearly highlighting that within finished goods and the very high margin or low components of raw materials in in working capital.

39:58 But perhaps if I just embellish a little on and go into the production side. So, obviously, GENEDRIVE, our sort of secret source or our IP is in the wet mix chemistry, and we outsource the the freeze drying to CITIVA. Saitiva freeze dry the product, but then also pack more often than not shipped direct to our customers. So what we have is a situation where the the supplier invoice is coming in almost the same time as the customer invoices are being sent out for shipment. So we have a kind of almost a natural hedge. So between that low raw material component and a sort of hedged customer receipts and supplier payment point of view, we're comfortable on working capital.

40:45 And if if the working capital grant was to ramp severely, I mean, we are debt free and factoring against that book or asset backed against that debt position would be would be relatively easy and quick given that we are in a debt free position. So in terms of working capital, we're we're pretty happy, pretty comfortable, and and we've got plans if things were to change. Thank you very much indeed. The second question was was generic around the PCR market. Reads, we are seeing more and more quality rapid antigen tests being validated and authorized. What impact do you think this is having or will have on the PCR market? I think that that one's probably for for me. I think this is a phenomenon that you see in most areas of diagnostic testing where things initially begin in a in a in a central lab, and then they, they become more broadly available throughout throughout the market.

41:48 You know, the the the advantage obviously of of antigen testing is it's it's very inexpensive. It has the promise to be very inexpensive, and it can be broadly distributed in the market, you know, in in the way that an instrument based assay can't, you know, and, you know, even even, obviously, my own, you know, my own my own kids come home and and and have, you know, lateral protesting now now from schools, and, you know, that was a phenomenon I think that no one, you know, really ever would have thought would have would have happened eighteen months ago. But so I think they certainly have a a role a role to play in in sort of community screening. I think where we are on a technology standpoint, though, is that they haven't haven't generally been shown to be of of an extremely high quality, but they're probably better than the alternative of of doing nothing sort of where we are.

42:47 So what how does it impact PCR testing? Well, it it probably, frankly, has a slightly negative effect on central lab testing. Right? If if people are testing the community, then they're less likely to to send the test in into into a central lab. I think that that would be fair to say. But but I I think it also, on the converse side, it drives the adoption and the knowledge and the acceptance of PCR based testing out at the point of care. Right? So in many ways, it it actually supports and leverages what it is that that we're that we're trying to do. Right? So I think that, you know, it's it's playing its role right now. It's probably the best alternative that we have right now. But going forward, there probably is room for better performing products and technologies as well. Yeah.

43:42 Last comment I I would make is is I do obviously, we we we feel lots of incoming inquiries and questions and things from, you know, customers, distributors, investors, etcetera. And and I think that this this idea that there should be one technology or one test or or one company that somehow has the best solution, and that will therefore, you know, sort of be the only solution that's used in the world is is is absolutely wrong. The reality is is that there's all, you know, not an incident, but there are so many different applications and areas for point of care testing. Right? And and every product I mean, I've even heard the DHSC guys and the NHS say that every product has its use case.

44:33 Right? Provided that a product performs well right now, there's probably a market segment where it would apply better than or would be applicable almost better than anything else. So I don't think we're going to evolve to a market where there's going to be one technology, one test, one company that somehow owns the globe. It will be a case of hundreds of companies with hundreds of different solutions occupying different end customers' targets, I think, is where it will it will all go. Thank you, David. Well well, look, I think, it it will probably just make sense, obviously, if I could hand back to you. As I said, if you just open the q and a tab, you'll see the investors' first name there. If you could ask you to read out perhaps the the question and who it's from and where appropriate, give an answer. There there are lots of questions and and there is absolutely we don't have the time to to address all of these. But perhaps, as I said earlier, you know, post this meeting, we'll be able to review every question that's coming and where appropriate, look at providing a response. So I'll hand back to you, David, if I may, and I'll pick up with you just before we close in in about fifteen minutes.

45:39 Okay. Alright. I'm just sort of glancing glancing through them. Actually, there there are not that many that are finance related. So I suspect I suspect I'll probably be answering most of these. But, obviously, Matthew, you wanna have a scroll through and see if there's something there that you wanna that you wanna address. There's one here from Jason that says, does our association expecting Coulter give us any advantage at all with the FDA? I think in in in theory, it it it it sounds like it should, but I think in practice, probably, it it doesn't. You know, the FDA, we are the applicant to the FDA, so we are the the the company of record.

46:25 And so their communication is is directly with us. We have had discussions with Beckman and their regulatory team around if they were able to support us, and that is sort of the the the theme that we get back from them because they are not an applicant to it, then then it's difficult for them. I think, you know, we might get ourselves to the position at some point, you know, that what let me just back back a sec. What fits with the FDA from our application standpoint is our instructions for use for the GENEDRIVE test. Right? So that includes our performance data. It includes, you know, all of the the methodology, the extraction kits that we use, and that's where the Beckman tie in comes. Right? The Beckman extraction kit is part of our instruction for use.

47:13 But what is not in our instructions for use yet is the use of the the Beckman Biomex system. Right? That dataset is not yet in there. And it is possible that we could get ourselves to the point where that submission is done in conjunction with Beckman, but we're but we're not there yet. And and if we were, then it it is possible, I guess, at that point that Beckman could Beckman could help us a little bit. Okay. So, Mark, the next this isn't well, there's there's there's four there's four questions here. So from different people that have the same theme, which given that there's four of them, I'll I'll just group them together. But I don't I have to confess, I don't exactly understand the the root the root cause of the question. So this one says, can we get confirmation, please, of exactly what kind of information is still currently restricted within nondisclosure agreements in place with Beckman, Coulter, Fiteva and your other suppliers? And what are the time lines or events that will lift these nondisclosures?

48:26 So I don't I confess I don't really recognize the driver for the question. We do have non disclosures in place with with our suppliers and and and partners just as part of our other contracts that we have with people, and they're no different than what you would find in any other any other contract with with anyone else. So I'm not sure why you know, what what the roots of the where the root of the questions are, what timelines or events will lift these NDAs, but just as long as the contracts are in existence. So, only answer it. I'm sorry, I don't really understand the purpose of the question, but I only answer it because it was asked several times.

49:16 This next question is from Michael. What steps have been taken to ensure adoption of point of care COVID testing within the health care and hospitality settings and other settings both in The UK and elsewhere. Well, at this at at this at this point, we don't have our product yet, right, obviously, to to to drive adoption in the market. Unlike our high throughput test, for for point of care, we are more focused on the on The UK market. And there is, you know, a known a known set of people, a known process to get product evaluated in The UK. So we are engaged with with those people. But, again, we don't have a final formulation of a of a product yet in which to engage people with. But, you know, clearly, the way to get engagement is to have product features and product performance that other companies or other other tests don't, or to have your product positioned at a specific you know, specific niche or a specific end user that other people can't get to. So one of the things that we've been trying to keep very strong in our point of care product definition is is biosafety.

50:27 So any right now, COVID testing is typically done within class two laboratories. Right? So people are wearing PPE, and they're working in in in vented vented conditions to prevent infection to the operator. When you move out of those environments and you move into a point of care setting, although you can certainly still wear PPE, some of the environmental and safety conditions aren't there anymore. And so it's very important for adoption that the operator be kept safe. Right? So a no no, for example, is is is if the operator has to open the specimen tube in order to access the sample. Right? And that's actually what most point of care devices do today. That that doesn't drive biosafety. So we're trying to move away from that and ensure that we're working with inactivated sample right from the from the collection point.

51:20 We recognize cost is important. Right now, the market will bear reasonable costs for products. And it's not a price sensitive market in most of the world. But over time, pricing always becomes relevant. And so again, our goal, as we talked about in the presentation, is to get the formulation of our product into a scalable manufacturer with SITIVO, which dramatically reduces our manufacturing costs and our ability not only to scale, but to deliver something that's affordable. So I think biosafety and cost are something that's very important to keep in the product. And the last thing I mentioned in the presentation or another thing I mentioned in the presentation was gene targeting. Right now, from a diagnostic standpoint, it isn't really relevant to know what type of or what strain of virus someone's infected with.

52:15 It clearly is of interest from an epidemiological and a public health standpoint. But from an actual individual's infection standpoint, it's not it's not very important. Right? You don't you don't treat someone differently depending on the on the variant that they are infected with. So at this stage, from a diagnostic standpoint, detecting variant strain isn't important. What is important is ensuring that your test does does detect the various strains that are are out there. And that is where we are today. We have just five main variants of interest that have been identified. The GENEDRIVE test itself and the formulation of the test itself has been shown not to be affected by those different variants, primarily because we don't target the gene where all that variation or a lot of that variation stems from.

53:11 Right? So I think provided that we can maintain biosafety, we've got a test that works well against variants, We've got the right cost point. And and and we did mention in the presentation, you know, some of the sort of time to results, which are are are pretty fast. I think those are all the types of features that will hold our product in in in good form going forward. Okay. There's we've got several tests in here or sorry. Several questions in here about the public health England tender and and and where we stand on that. So public for the background, for those that don't know, Public Health England issued a tender a while ago for suppliers to contribute both to COVID and non COVID related things over a period of five years.

54:04 Public Health England have in their documentation right from the start been very clear that companies are not allowed to announce any results of those awards positively or negatively until they're informed directly by PHE. Right? And we not been as of yet. We did, however, I can confirm, we did submit all of our current CE marked products. So we we submitted our hepatitis c, our high throughput COVID test, and our antibiotic induced hearing loss test into the tender. We did not submit our point of care product because the tender required products to be CE marked.

54:49 So that that's where we are, but we're not we're not in a position to to announce anything. Okay? And then, Mark, just looking at the time here, we've got a couple of minutes left. There's a next question is, how long can GENEDRIVE continue selling COVID tests in The United States without an emergency use authorization? So clearly, use authorization is what we are aiming for. The ability to import and sell without an EUA sort of contained within the same regulations that EUA starts from anyway. So I don't think there's any different timelines associated with selling without one or selling with one.

55:39 EUA itself, of course, does have a by by its definition, it's supposed to be temporary. Right? It's supposed to be under an emergency. But I'm only I'm only aware of a handful of products that actually have formal full FDA review, I. E. They've been through a PMA or a five ten ks process. 99.9% of products that are being used in The United States are under EUA. So I think it's probably not in the cards that the FDA would withdraw those permissions anytime soon. David, I I I don't want to to cut across you, but I am mindful of time. Obviously, we're coming out to the hour. For every question you answer, there seems to be another two that come in. So I think what would make sense is, obviously, we we give you time to put measured responses where it's appropriate to do so. We so all the investors that submitted questions, thank you for doing so. And, obviously, we will present these to the company for their review. And like I said earlier, we will send you a link notifying you when they're available for you your review. And, David, investor feedback, I know it's important. What I would propose to do is if I could just ask you for a few closing remarks, and then what I'll do is I'll redirect investors so they can provide you their views and expectations.

56:55 Yeah. Okay. Thanks, Mark. I mean, Melissa, I we did try to sum up in the presentation. You know, we we we do recognize, obviously, the frustration around the COVID test and commercialization. And what I tried to do in the presentation is to highlight what the roadblocks are. They really are around registrations, which, to some extent, are out of our control. And although it might come across as an excuse, that's just the reality, right? That's where we are. I think we are in a position where we are poised in markets with very good distribution partners and a very well performing test. And we just need one of these things to land for us in the near future, right? And then we're off to the races. So again, recognize the frustration, but I would also ask people to look forward to what the opportunity looks like. And we feel confident that we'll get ourselves there.

57:48 David, Matthew, thank you once again very much indeed for your time today and for updating investors. Could I please ask investors not to close this session as you'll now be automatically redirected for the opportunity to provide your feedback. If you access this meeting from our website, then the feedback page will appear. But if you access this meeting via the link sent to you by email, then you'll simply be asked to log back in to submit your feedback. On behalf of the management team of GENEDRIVE, we'd like to thank you very much indeed for attending today's presentation. That now concludes today's session. Good afternoon or good morning, should I say, to you all.