Genincode (LSE:GENI) — Final results presentation

0:00 Good afternoon, and welcome to the GENINCODE PLC final results presentation. Throughout this recorded presentation, investors will be in listen only mode. Questions are encouraged and can be submitted at any time by the Q and A tab situated in the right hand corner of your screen. Just simply type in your questions and press send. The company may not be in a position to answer every question it receives in the meeting itself. However, the company will review all questions submitted today and publish responses where it is appropriate to do so. Before we begin, I'd like to submit the following poll.

0:27 I'd now like to hand you over to Matthew Walls, CEO. Good afternoon, sir. Thank you, Alessandro. Good afternoon, everyone, and welcome to the prelim report and accounts results for 2022 for GENINCODE. Paul Fulger is accompanying me here. We're in the center of London at King William Street for those of you familiar with roughly where we are. And we'll start to move through with some pace over the first few slides and then start to get into the meat of the presentation, and we'll try and give ourselves plenty of time towards the end to take some questions and answers from investors and those people on the call. So moving forward, I'll start with a quick review of a board. We'll talk through the highlights.

1:15 We'll have a review of where we are in terms of product portfolio, The US strategy, which is key to the company moving forward, what's happening in The UK and EU, and then a little update on on Roka, the acquisition we made through the past year, and then we'll finish on a financial summary and outlook. Board, no changes to report here, and we don't expect any. The board has been in place now for over the last year or two post the IPO. We brought in Felix through more recently. He's based on the West Coast. Felix got a good background with the FDA, and he's been helpful in terms of supporting the work we've done on the five ten k, which we'll talk through. And those perhaps who are less familiar with Hugh and Gray who joined us who headed up the cardiovascular side of the NHS here in The UK.

2:03 Sergio Oliveiro, one of the initial investors to the company, and Bill Rhodes is the chair. And I think the the group are hopefully familiar with the executive team too.

2:23 Okay. So moving on just in terms of a quick introduction. So GENINCODE, we're a clinical genetic diagnostic company focused in and around polygenics. So that's the use of multiple genes, to identify, risk assess, and diagnose patients with cardiovascular disease. To do that effectively, the more complex it gets in terms of multiple genes, we have to use bioinformatics to do that. And, increasingly, as we move forward at the algorithmic side of what we do in the risk scoring, we use an AI content too. So there are three effective parts of the way that we run through, report, and produce our results for our testing. We're revenue generating, albeit at the early stages of that process, but we'll talk through that in some detail through the presentation.

3:09 We've got good regulatory positioning and increasingly now moving into The US. That's growing too. Solid investment in terms of the history of the growth of the company, and that goes back to the initial investment that was made by Ferra Grupo, the pharmaceutical company based out of Spain. Strong evidence base, and that's growing significantly and will do so over the coming months from the work that we're doing with Kaiser Kaiser Permanente on the West Coast in The US. Got good IP protection around the core and the four products that we're now taking into the market. And that multiple product position means that we have a strong portfolio from which we grow, and we're growing out what we're doing in cardiovascular disease. The market is a significant market, and it's a big opportunity for the company. The reason for that is that at the moment in terms of clinical risk assessment and the risk assessment of primarily globally at present, the way that a patient is assessed for the onset of heart disease and cardiovascular, risk is by what we call clinical risk factors, whether you smoke, your weight, whether you undertake physical activity, and so on.

4:15 Most I think most people on the call will be somewhat familiar with that. The piece that's missing from that is the genetic risk. And over the last twenty years, the one thing that's happened is that we've become now very clear that the genetics of the individual, the inherited genetics, is a key part and a significant factor. As a single factor, it's the most important factor outside of the age and gender of the individual that gives rise to the onset of heart disease. So to have to not include that, it's a a suboptimal test process. So to include it is a key part, and that's what we do as a company. We bring the genetic risk assessment for cardiovascular disease to the patient population. So moving on to the report of the the prelims. These went out on Tuesday morning.

5:04 I won't cover them all in line for line detail, but just to give you a headline because we'll be talking about these in more more detail as we move through. We're now starting to launch our products into The US market. I'm pleased to say we've opened up our early access programs, and we'll talk more about that in a moment. We received our clear approval for setting up our new lab in Irvine on the West Coast Of The US. We received our PLA coding, so that's the forerunner to then receiving reimbursement. We've still got to go through that process, but we're well placed to move that through too. Final preparations for the filing of the five ten k are in place, and we expect to file that over the coming weeks. We've been in the position of considering filing this for quite some time, but in discussions with the FDA, they wanted to see more detail in volume across multiple labs. So it's taken us longer than we expected, but we're happy about the progress and good communications with the FDA.

6:00 So when we do file, we expect it to be right first time. So we're in a good position there, but it has taken us certainly longer than we expected to move forward. And just just so the the group are aware, this is on a kit format. It's not stopping us selling our product as a lab diagnostic test in The US, but it's the kit accompaniment to that. So it allows us to sell it much more broadly and in higher volumes as we start to move through the market in The US. We've also now had NHS adoption of Lippin and Coats. I'm pleased about that too. The last update, I'd explained that there were budget issues with the NHS. Well, they're starting to move a little bit in our favor. So we've now not only started to receive budget for payment of Lipton code testing, but things are moving quite quickly on that on that front too. So we're pleased about that. We also talked about the launch of our first pilot for CardioEncode in Extramedura in Spain, so that's the rollout of the primary care process in Spain too.

6:58 We also have talked about the launch of our programs now with Lipid Encode in Germany as well. So all of these pieces that are coming in now are revenue accretive, so building on the existing business that we already have. And whilst the numbers that we're reporting this year are not particularly high in terms of 1,400,000, we expect that through the the deals we're now putting in place and announcing, this year, we expect the revenues to double or some certainly move in that direction. And next year, we're expecting to see them double up perhaps again. So significant revenue growth starting to come through now, and we expect to see some of that coming through in the interims as we report that will be in September of this year. Kaiser is is working very closely with us, and some of you may have seen some of the announcements we've made recently. We've got some big publications coming from them.

7:49 Working with a big group like Kaiser, we have to because this is a population based testing we're dealing with. We have over 60,000 patients in the clinical studies that we're doing with them, and they'll be presenting this at the ESC annual meeting in the next couple of months. I will also be filing our first major publications with, Journal of American, Cardiology in the next, few months too. So big studies coming, big publications which show that, the products that we're leading, especially cardio encode, are very well placed for polygenic risk assessment of cardiovascular disease. They will be authoritative in the space. They'll be be perhaps some of the biggest papers, to be announced. They're based around a fifteen year follow-up of patients on the West Coast within that population.

8:37 So it it's an exciting phase as the company moves forward. We also made, as I mentioned, a small and a very attractive deal for us as a company of the Roku algorithm. This is for the onset and early staging of ovarian cancer in women. The the importance of that that work is that and we announced this through the ALDO paper earlier in the year. This gives this is the first product of its type to be able to see early staging and onset of ovarian cancer in women. As I mentioned, revenue's up marginally, but but still coming through in terms of this at the early stages of our revenue growth cycle. And, obviously, we had a pretty solid cash position that we've measured over the last two years since we came to market. We've been very, you know, prudent around the amount that we invest. So we finished the year in 2020 with strong cash reserves. At the moment, we have around about 6,000,000 of cash, and, obviously, we're we're keen to see the revenues growing now with a view to chasing down the losses and moving to a breakeven based business model.

9:49 Next slide. This is really around the regulatory position of each of the products within the portfolio. So on the right hand side and moving from right to left, you can see we have regulatory approval across the Europe European business. UK CE CA mark, we're still using the CE mark, which is accepted and will be until the CA process is set up properly in The UK. So we have lipid encode and cardio encode covered there. We expect into next year that thrombo encode and sub encode will also be part of the portfolio for The UK. In The US, CardioENCODE now and LipidENCODE are coming on stream, and we obviously have our filing with the FDA coming over the coming weeks, and ThromboINCODE and SUDENCODE into next year as well.

10:32 This is just a quick schematic for those of you not maybe familiar. We collect samples, either whole blood, buccal swab, or saliva from the patient. They go off to our lab. We process those on a molecular basis. They then go through our bioinformatics and AI algorithmic assessment risk scoring, and we then produce those re reports online to the physicians. So we've been operating in this way for the past four, five years as an independent company since we acquired since GENINCODE was acquired and put together. And, importantly, to do this effectively, you need a backbone system infrastructure to do that, which is what the SitApp system is. And internationally, as we roll out our products, we're rolling out the SitApp system with it. It's a very effective system, and it allows us to not only work through, the products on a molecular basis, but also to provide the algorithmic AI and reporting online to physicians.

11:27 So this is the market, slide nine, for The US. It's a significant market, not only in terms of numbers of Americans who suffer with cardiovascular disease, but the fact that it represents the biggest disease area in terms of mortality in The US. It's also a significant toll and cost burden and is set to to run out of it's certainly almost run out of control over the coming years with the with the growth in costs associated with maintaining and and handling cardiovascular disease. So this is when we talk about cardiovascular disease, I'm talking about heart attack and stroke. And roughly speaking, that's eighty percent heart attack in terms of mortality and twenty percent stroke.

12:18 Moving to The US, this is the we're leading into The US with the two core products, Cardio Encode and Lipid Encode. We've recruited our own GENINCODE sales team now. So our partner, Eversana, who we've been working closely with to complement that team, we've now got our own in house executives. We recruited that team from the invite VITI Group on the West Coast who are a fairly large diagnostic group there. The team has joined us at the back end of the year. They've been working very closely with us, and you'll see as we move through the presentation, we're now making good progress in terms of the team supporting the introduction of the products into The US market. In the first wave, that's the first quarter we've now brought in 18 new accounts. So these are accounts that are starting to take our products, both Cardio Encode and Lipid Encode.

13:11 And the early access program allows us to give them access to the product on a free of charge basis and then in return for feedback and moving then on to adoption of the products moving forward. So we started this program at the beginning of the year. There are 18 in the first quarter, just to give the the the group some insight. In the second quarter, we expect to double that. So there's a further, group coming in in the second quarter. And the likelihood is over the next year or two, we will continue. These are all tier one based groups, big institutions up and down, The US, and I'll come to those in more detail in a moment. I mentioned on the regulatory side, we now have our CLEAR certification in California state licensing that allows us to collect samples from around The US, bring them back to our labs, process them, and provide the reporting online.

14:01 And, also, the filing of the five ten k is now preparing a near final in terms of submission over the coming weeks. We received our CPT PLA coding from the American Medical Association, and I'm also gonna be presenting to the CMS in the next few weeks around our pricing for cardio encode, which is the forerunner to our MoLDIX submission for reimbursement in The US market. Bear in mind, again, for the group, just so you're aware, reimbursement represents about 20% of the revenue forecast that we have in our models. The other 80% is based on private payer based insurance coverage. And it's important to get that reimbursement, but at the same time, start the discussions with private payers. So we've started the process with the CMS.

14:47 And then towards the end of this year, we'll make the submission from all the X. But at the same time, running in parallel with that, we'll be talking with the private payers too. As I mentioned, we've expanded the we're expanding the early access programs and the sales team. We've also appointed what we call a revenue cycle manager. Revenue cycle manager, for those of you familiar, allows us to the complexity of selling in The US, you're selling to clinical institutions, hospitals, consultants, insurance groups. There are a number of different pockets of sales and groups that we'll be moving product to. And in doing that, we do a lot of benefits investigation, prior approval checks, and so on. And to do that, we're working with a revenue cycle manager is a effective way of doing that in a complex selling process.

15:38 So we adopted Synergy, and a few months ago, they've been working closely with us. They will be dealing with The US billing across those billing platforms, both in terms of CMS reimbursement as well as the private paying network. And publications, as I mentioned, just to finish off on this slide, strong positioning from Kaiser. We've also been asked, and I will be now sitting on the European Society of Cardiology's regulatory board, the cardiogenic genomics board around the introduction of polygenic risk setting for Europe. We've also been asked as a company to put together a roundtable for the American College of Cardiologists, again, for the introduction of polygenic testing in The US. Just so the group are aware, polygenic testing is a very difficult thing to do with. Very often, one of the issues is there isn't a lot of evidence base.

16:29 We have perhaps some of the biggest evidence base in this area globally. When we announced the Kaiser paper for a fifteen year follow-up, we'll probably move. If not, we're already towards the front of that to being at the forefront of change both in terms of the introduction of our products, polygenic risk products, into the health care systems in Europe and The US, but we'll also be leading that with our products moving into market. Okay. So these are the the cornerstone groups we're working with. So in Indiana Indiana School of Medicine, they head up our calcium scoring study. So this is a combination of using polygenics with calcium scoring. We we know from the the CT imaging calcium scoring that's undertaken, it's a point in time reference point. But coupled with polygenics at risk of the individual in the genetic terms brings another layer of insight and value to the physician in terms of risk assessing the patient for, heart attack, heart disease, and stroke.

17:31 Kaiser, as I've mentioned, they've done a lot of work with us over the last ten years in preparing and running with Cardio Encode in building it out, and they'll be presenting on that in in much more detail later this year. There are actually three papers that we have, but the main paper, the first paper, is likely to be submitted a little bit about August, September of this year. MedStar, we haven't talked a lot about them, but they're going to be key and instrumental to what we're doing on the clinical utility for the filing of our MolDX program. They're based out of Georgetown, Washington. And NYP, perhaps the biggest of the health care groups in in The US. So that's New York State, Columbia, and Cornell. And we're working with our primary care network in terms of introduction of Cardio and Co to that group. So some really solid cornerstone groups who are now starting to take our product.

18:18 And, you know, importantly, as we move through this process, they're also starting to use the same structures and systems that we've operated here in Europe and also with the NHS. So we're building out a system here that's common on an international footing.

18:33 So these here are the 18 sites that that are the first tier one group that we're we're moving to, and you can see them. The interesting thing is in the second quarter, we're gonna double on the on this again. So this is gonna get quite a busy chart, but I quite like the idea of that getting very busy and and lots happening. We're gonna continue with this. It's a very mechanical process. So if I move to the the next slide, you'll start to see how we operate it. So on the left hand side, you have the list at the top, the the first 18 in tier one. We start with what we call a physician engagement or an education process. So we present our products to them, explain how they work, go through the reporting. Then sign up to an early access program so they get chance to use the the the products, test them through, get comfortable with them, and then they move on to clinical adoption.

19:23 They're not working with us because it it's a nice free of charge item to have. They're working with us because they believe these products will move the needle in terms of improving risk assessment in cardiovascular disease.

19:36 All of these groups and most of the 18 that we we work with, we've worked with them, and they're knowledgeable about the products coming for the past few years now. So I'm pleased to say our expectation is that once they've been through the early access program, they've set up internally to start sending samples to us, that this program will continue to grow on an adopted commercial basis as we move forward. So it's an exciting time for us because that's just representing the first quarter. If you move on to add another 18 on the left hand side, this program will continue to roll out in that fashion at least for the next twelve to eighteen months as far as we can see with the tier one status groups. And then within each one of those, groups, they have their own individual network too. So that cascade process should start to then unveil and bring polygenic, testing at a cardiovascular level to most of the tier one groups. The tier two tend to be community based, more diffuse clinic clinic based groups within states, and that that requires a a much broader bandwidth in terms of both cost and coverage.

20:38 And at this stage, for what we're doing in terms of investment, we're keeping it very focused on tier one, and we're using our setup system on a digital basis to move that that system into position with these tier one accounts. So we're minimizing the amount of people and feed on the ground to to keep the bandwidth tight, keep our cost base low with a view to, as I said earlier, moving the company through to a breakeven footing over the coming years. And we can see our from the forecast side of where we are, we can see a pathway there forward to delivering that program. So, again, I've put this in I'd presented it previously in this format. I think it's a good way to keep coming back for continuity. We started the and the the upper half of this of this slide is regulatory timeline.

21:27 The lower level is the reimbursement pathway. So on the regulatory timeline, cardio obviously is is earlier than lipid encode. Lipid encode is more advanced than cardio in regulatory terms. But in cardio, we've now launched the the product into The US market. We started the reimbursement process through the CPT PLA. We expect to file our regulatory submission for cardio encode. I'll be presenting to the CMS around pricing in the next couple of weeks. Towards the end of this year, we'll make our submission. And then into the beginning of next year, we expect to then see what we call the expanded launch. That's when we we would expect to see the approval come through from the FDA, and that will then open up the kit based process on top of our lab based processes for cardio and code. On the reimbursement side, again, in line with what I've just said, the CPT PLA coding is now in place. Pricing is coming through. That then supports the MoldeX submission.

22:21 Early part of next year, we're looking then at to some degree. We'd like to see the CMS look at closely where we are. We'll have already started to provide product on a lab diagnostic test into The US market. So the discussions around CMS coverage will start in the first half of twenty twenty four. At the same time, in parallel with that, we're running out with our commercial payers, so we've started those discussions, albeit only at the one or two level at this stage. But this is important to us in terms of moving the product forward in coverage terms and reimbursement. It's also worthwhile saying that in these early days, once we move the product into market, we're working through an out of pocket self pay process for the market. It's important that it's important for me and the company that we start to engage the product in the market.

23:08 So self pay and out of pocket, this this is the means by which we price the product at a point in which the an individual patient can pay for it themselves is an important part of this first phase. It will be complemented by reimbursement as that comes through, but we don't want to hold up. We want to move the product into market where physicians are prescribing it and offering it to their patients and providing it at a price point for patients so they can afford it is a key part of what we're looking at now as a strategy moving CardioCode into market.

23:43 In terms of the market, again, just to remind the group, the overall, there are 86,000,000 individuals in in The US who are suffering with cardiovascular disease, of which of those, twenty one million are identified within that group of what we call low or intermediate risk of an event of heart attack or stroke.

24:06 It's those that are currently in that twenty one who are currently u were using or they've used classic traditional measures to to risk assess those individuals, so they're not using genetics. When we did our market assessment with our partners of Asana, they identified that eight and a half million of those patients when talking with physicians, if their physicians if their patients had coverage, they would move them towards using CardiENCODE as a product. So there's a significant market for us to go to. The market itself is is currently in terms of the way that they're risk assessing that patient group. It's suboptimal. So that will be the first market, position we go to. As you can see, it's a significant market.

24:52 And and for us, as we move into market, we expect to to see that this is underpinning the growth of the product over the coming years. It's certainly not going to happen, you know, immediately at those levels, soon. It takes time to build out our network, and the providers into into the, into the market, but it's a very exciting, position. It's worthwhile saying there's three phases to that process. The first phase is introducing the the product to physicians so they can start to prescribe. The second phase is that it becomes part of the guidelines, and that's what I mentioned a little bit earlier and some of the early stage discussions we're now starting to have. And the third phase is because the genetics of the individual represents fifty percent of the risk of them having an a heart attack or event, then that will become the baseline. That will become the new key parameter that we're assessed by as we move forward in terms of risk assessment for cardiovascular disease.

25:46 So there are three phases to the the growth model that we're moving. Moving then on to lipid encode. So a little bit more established. Familial hypercholesterolemia is a little bit more advanced in terms of its position in The US market. But our product that we're bringing to The US market is more comprehensive and advanced than the current testing that's currently underway. So FH, as we call it, familiar hypercholesterolemia, this is inherited, an inherited inability of an individual to metabolize properly cholesterol, which gives rise to elevated levels of cholesterol circulating in the blood, which therefore gives rise to the onset of atherosclerosis clogging of the arteries over a over a lifetime.

26:33 For those individuals who are identified as suffering with FH, then they're at a much higher risk of a heart event, heart attack, or stroke than those who have got a better metabolism for cholesterol. Now the the good thing about that is once you identify the individuals, then it's a very effective mechanism for treating them. So it's a classic personalized medicine position, but we have to find them, and we have to then effectively treat them. And at the moment, we we, both in The UK as well as in The US, not very effective at identifying, these individuals. Last year, the CDC, recognized FH as a tier one issue, so they've put it right to the top of the public health issues in The US. It's now got state coverage in 14 states in The US and reimbursement coverage from the private payers as well. So this is a good opportunity for us to move our globally leading product position into into The US market.

27:31 And the reason it's leading over what's current current testing is underway in The US is for for three, well, three reasons. First of all, we do a broad panel of testing

27:41 on the FH side, which is roughly the same as what the the testing is in The US. But in addition to that, we then provide polygenic risk assessment, which is novel. And then on top of that, we also provide the coronary artery disease risk, coronary heart disease risk, which is in addition to that. That's the cardio encode piece, which is additive to that. So the physician gets a much more rounded view when he undertakes this test rather than undertaking a test which is largely binary at the moment and carries quite a cost with

28:12 it. So working on a binary yes or no and getting it wrong is an expensive process. So our our product provides them with a lot more insight and and positioning on the patient's risk for not only diagnosis, but then risk of heart disease in relation to FH and hypercholesterolemia. So we focused we originally started at the beginning of the year and back end of last year with focusing on the tier one targets. And what we found is as we had the discussions with them on FH and lipid ENCODE, that they were all equally interested in cardio ENCODE. So hence, we've accelerated cardio ENCODE. So both lipid ENCODE and cardio ENCODE are now going into those tier one targets.

28:58 The tier two targets, as we get into deeper into next year, given the the size and the the bandwidth required there, we'll be focused on the tier one targets for quite some time. As I mentioned, we're already into growing that out significantly into the first half of this year.

29:15 There are about one at least one and a half million patients in The US who suffer with FH. And the problem with that is whilst it doesn't, on the face of it, look like a high number compared to cardiovascular disease, it's very difficult to identify those individuals. So whilst the overall market is perhaps in just taking the number of individuals who suffer with FH and looking at the reimbursement of around about a thousand $1,400 a test, you come up with around about 2,000,000,000 as a market. Very often, they they it's based on a hit rate. So where, at the moment, individuals are being tested, Here in The UK, we've just started working with the with the UK NHS. And in the NHS, the hit rate is relatively low. It's not a high number of individuals who they're proposing for testing who then turn out to be FH positive.

30:08 So you end up doing a lot of testing where the individuals are not FH positive to find an individual who is. So the market size is actually significantly more than the

30:19 2,000,000,000 level that that we've mentioned here, but just to give the the group an idea of the size of the market and the offering we have. And this is the reimbursement for lipid encode. At the moment, on a CMS basis, it's about $1,400 a test. That's Medicare, Medicaid. But when you then mix with that the private paying process, the aggregate drops to around about $1,000 a test. It's our and we anticipate moving into market at a a lower price to that. Here in Europe, just so the group are aware, we sell the test for in Europe between 350, €400. Here in The UK, we sell it privately at £800 a test or to the NHS at £450 a test. And in The US, we anticipate making, price we expect to be a competitive advantage for us as we move into The US market with what we believe is a globally leading product in this space.

31:18 And, again, as I said, it's a little easier on the regulatory and reimbursement pathway. We have the coding pricing. We've now launched, lipid encode into The US market. Our billing will be, as I mentioned earlier, undertaken by Synergene, and it's really then into growth and adoption as we move through this year and then again into next year reviewing where we are in terms of an expanded launch. And, again, then below that, it's primarily then working with not only the tier one partners, but also commercial private payers as we push them through on reimbursement on that side. So those are the two products, cardio and lipid. If I then move to The UK strategy, so this is with the NHS. We've talked previously about the work we've done. So we did originally clinical studies with the NHS, which were positive.

32:07 We then moved into an implementation pilot implementation in the North Of England.

32:12 And then at the last update I gave, I explained that the NHS was struggling to find budget to to pay for the work that we were starting to do with them. Well, they've now found that, so we're pleased about that process, and we're starting to accelerate through the backlog of tests that they have in the North Of England. And just so that the group are aware, it's that that's the the process. So the on the left hand side here, these are the 15 AHSN groups that up and down NHS England. We've been working with the North Of England group. We've now implemented the process in the North Of England. And just so, again, the group are aware, we we've only done that in the past few months. The the budget process has started to kick in, but already we're making good inroads for the North Of England into that into that process.

33:00 In addition to that, the same process we're now starting to unfold into other areas across The UK, so we're working with UCL Partners and Barts here in London, and also starting the process of working with the West Midlands too. So, very exciting. The model's clear.

33:18 We're also providing a product that is superior to the test processes currently undertaken. We're doing that in fast turnaround times by comparison with what the NHS can do internally and also at a lower cost to the NHS. So it becomes very simple,

33:36 an easy decision to make that it's better in this instance for the the spend to be spent on the more other more interesting areas of the NHS rather than, you know, not doing it. I mean, it's it makes more sense for them to give the move the business closely towards us given we're providing a more comprehensive position, faster turnaround, and and lower cost. On the on the EU, a little bit different in the EU. Each nation is much smaller in terms of size and scope and and revenue, but we've got a good foothold and a good cornerstone out of the work that we've done in Spain, and that continues to be our key market in what we've done in Europe. Obviously, Italy is coming on on on board as well with that process through Spain. And recently, we've announced what we're doing in in Germany, which coupled with The UK, we're seeing a, an uptick in revenues in in Europe this year, so we're very pleased

34:30 about that, which coupled with the German expansion as well will mean Europe this year will have a a pretty strong revenue performance. And you'll see that in the interims when we get to September, October this year. We expect to see probably in the first half, the beginning of a 50% growth year on year in the first half. But by the end of the year, we're looking at something in the order of about a 100% growth in revenue terms, as I mentioned earlier.

35:01 And then just a quick update on the the Abcodia acquisition. The key point here is NICE guideline issues. So we're we're waiting for NICE to give a guideline update in this area. Ovarian cancer shares there's a lot of overlap with the way that we look at early staging and risk assessment in for cardiovascular disease. There's a of overlap with the way that the ROCA test performs for ovarian cancer. The interesting thing here is that we the NICE guidelines so this is for women who are suffering their their high risk of ovarian cancer, their BRCA carriers, and within the that process, they've decided not to undertake risk reducing surgery. For example, they've decided to continue with their family planning and not to have risk reducing surgery, which is is not a that that involves removal of the ovaries.

35:55 So it it's not a, as with breast cancer breast cancer and BRCA one and two, it's not something that is

36:05 a surgery that is is easily undertaken. And, therefore, a lot of women will put it off. They'll think about family planning. And as a result of that, they then put themselves at higher risk. And what the ROCA test does is provide them with a monitoring tool for those women who decide not to go ahead with that, whereby they can monitor the onset and potential staging of onset for ovarian cancer. The important thing about this test is it's also got very good economics. So from a NICE perspective, it fits very well. But we're waiting for their guidance development on this. It will remain as we are doing at the moment. It's a very attractive deal for us. We we didn't pay any large sums upfront or anything of that nature. But on the basis that we receive NICE guideline support, then this will not only move forward in the ROCA test, but we also have some interesting thoughts around earlier than the early stages of ovarian cancer looking at the polygenic risk for ovarian cancer as well. So it's a good step for us to move in at a low cost investment into ovarian cancer and to the cancer side with what we do in preventative thoughts.

37:09 But at this point, it's not one we're investing heavily yet because we want to see that NICE guideline development coming through.

37:18 Okay. I'll hand over to Paul, and he'll give us a quick update on the financials. Thank you, Matthew. Good afternoon to you all. Just to recap, first of all, the company structure. So we have Topco, which is is GENINCODE PLC. We have the main trading subsidiary, GENINCODE SLU, based over in Spain. We have GENINCO US Inc. Over in The US, and now we have the company underneath Topco together with its two subsidiaries. So we came to market in July 21, $2,017,000,000 gross, 15,300,000 net. So revenue is up 24% to 1,400,000, a modest increase, but we'll, importantly, proof of commercial transaction. Geographically, as you can imagine, most of that revenue came from Spain.

38:06 About 1,200,000 of that revenue came from Spain. The rest came from Italy, £150,000 or so. And for the first time, we had a small amount of UK revenue, about £36,000 of UK revenue. So far this year, in the first four months of twenty twenty three, we're around 30% ahead of where we were this time last year. So good solid growth, and that was helped by £40,000 worth of UK revenue in in April and hopefully at least £40,000 per subsequent month for the rest of the year. So Matthew discussed the the interim number there. We expect to be 50% ahead of where we were last year, and, hopefully, by the end of the year. With that solid UK growth, we should be double where we were last year and, potentially, and hopefully double next year as well.

38:58 Product wise, lipid encode, is up 30%. That that represents almost half of our revenues, so that's our biggest seller, followed by THWMBO, followed by SADINCODE, and, followed by CardioENCODE. Now lipid ENCODE and SADINCODE are the two sequencing tests rather than the genotyping tests on the other two. So they're the lower margin, so that's why the margins reduced down to 44% or so because of that product mix. Notoriously competitive in Europe. So we don't expect margins to be above the 50% level, really, medium to long term, and that will and that's really by improving the economies of scale from the increased testing in the in the future.

39:46 But products mix wise or geographic mix wise going forward, The UK margins will be much better. They're about 60% plus. And in The US, even better still at 70% plus. So we will see a blended improvement over the coming year and into the medium to long term as well. Operating loss increased to £5,900,000 The main reasons for that is two main reasons. Firstly, Edasana costs increased. Edasana, remember, is our US commercialization partner. So because we are close to commercialization, we've now geared up our staffing levels. So we've now got five full time staff in The US. We've now got five, more or less, five full time consultants in The US as well. So they're a combination of lab staff as well as commercial staff.

40:39 We've now got two labs, one in Hammersmith in London in The UK, and one in Irvine in California in The US. So the starting cost setup cost for kitting those out with utilities as well as equipment added a relatively significant cost base there. So we spent well over £1,200,000 just on the equipment. But that equipment is obviously investment for the future, and that should help us scale up and for the next two years, at least, in terms of our testing capacity. So all in line with budget. On just two notable points on the working capital. So payables increased. That was mainly because of the Avarsana deal we have last year to defer 50% of the costs.

41:29 But because we haven't spent so much with Avarsana, we as Matthew mentioned, we've got some of the Invitae staff who are now team now. So we have actually got our own some some salespeople ourselves. So we are saving significant amounts of money by Eversana not feeding us through those costs. So we're actually using some of those savings to pay down a little bit of the Evarsana deferred payables now. And, actually, the Evarsana deferred balance is a little bit lower than it was at the year end. We also have some equipment creditors at the year end and lease liabilities with changing IFRS 16 regulations, etcetera. Coming down to cash, we had we had £9,700,000 at the year end. So on average, last year, we had a monthly burn rate of about £400,000.

42:19 That has increased as you would expect this year up to more more like £700,000 per month. That's because we're closer to commercialization, so we've had to gear up our operating costs accordingly. But we're now around we still have a good amount of cash. We have at least £6,000,000, so that's expected to last as well into q one twenty twenty four. That's about it. I'll hand back over to Matthew. Thanks, Paul. Okay. So so just starting to round up a little bit, and then we'll move to some some q and a. This is the summary then of our our key events looking out and and news flow to come and just drawing the attention from a left to right process. So we've now got our ClearLab and California state licensing. We've now got our PLA.

43:06 We've implemented the the first NHS piece, and that's now started to grow in terms of revenue. Similarly, we've started to grow out what we're doing in Germany. That's also starting to generate revenues. These are the incremental pieces adding to the the interim profit or interim reporting position that will be coming back to the markets within the in the next few months. And we've now obviously started our early access programs in The US too. And then carrying on, we've got the filing. We've got updates from Kaiser coming, updates from MedStar. I'll be talking to the CMS, as I've mentioned. We expect cap accreditation probably into the third, fourth quarter. I've got, discussions ongoing next week with on that side. And the cap, just so know what cap accreditation is, of the forty, fifty two states in The US, some of the states, New York State being one, require us to have a higher level of, College of American Pathologist coverage accreditation as opposed to just the clear. So it's a a few additional states want us to have a higher level.

44:08 We should have that in the next few months that allows us to start bringing back rather than testing in those states, for the work that we do. We can bring those samples back to the Irvine Lab in the short, medium term. MoldeX submission towards the end of this year and then expansion again into 2024. So those items in red, dotted in red, if you can see those, are all part of the recurring revenue streams now that are coming on board. And importantly, a driving through have started now in the first half of this year, will impact the interim results and obviously push on into next year as they continue to grow out, The US and The UK and obviously Germany as well. So all of those are starting to come through, so we're we're we're pleased about that. And then as we move to just, again, finalizing rounding up, all of the guns now pointing out revenue growth. That's key. We want to start to turn the business now into a revenue generating machine on all of the products. We're now gaining regulatory approval so we can start to sell them in the key markets that we focused on.

45:08 We'll be pushing on with reimbursement, filing our five ten k kit, expanding what we're doing with the NHS, and moving forward, we're also looking at moving forward cardio encoding to the NHS as well. That will be important for primary care purposes so we can bring the NHS alongside lipid encode up to speed with what what cardio encode can offer as well. We'll expect expand the the German collaboration too and and ditto the same with our Spanish and Italian collaborations as well. Towards the end of this year, beginning of next year, we'll look at then the commercial marketing team because there will be whilst it's not, you know, significant headcount numbers, there will be some step up simply because the sheer numbers of clients we will have at that stage will be significant, and there will be some people who will need to have focused on the geography mainly in The US.

46:00 And as I said, we'll await then the NICE guideline feedback. And and all in all, this is the the final point just to to be clear. We're going to target, and this is partly as a result to to take more and more less and less reliance on investment and more and more reliance on driving the company into a profitable breakeven profit position. That's where we want to be in the medium term. So that's the strategy for the company moving forward. Whilst we raised back in twenty twenty one two years of funds, we're now making it move to three, stretching that, but at the same time, making sure we deliver the, you know, a formidable model from which investors can take comfort. So that's that's where we are. I think if I hand back to Paul have you got the questions there, Paul, or is it Alessandro who's got the questions? Yeah.

46:47 No. We we have a couple of questions up on the q and a. Alessandro, is there anything you wanted to say first before I move on? No. So, Matthew, Paul, thank you very much for your presentation. Ladies and gentlemen, please please do continue to submit your questions just by using the q and a tab, which is situated on the top right hand corner of your screen. We just saw Paul and Matthew take a few moments for you those questions submitted today. I'd like to remind you that recording of this presentation along with a copy of the slides and the published q and a can be accessed via your investor dashboard. But, Paul, at this point, if I may, if I could just hand over to you just to chair the q and a, and I'll pick up from you at the end. Yeah. We just have a couple of questions from Steve at this stage. Steve's first question is with the increased levels of investments in the commercial program, when do you anticipate this turning from investment to growth?

47:36 Well, let let me just try and understand. I think what he's probably saying is when does he expect it to be no no further investment requirement, maybe, in terms of growth. If we're talking about growth in revenue terms, then that started. So that's the first point. From the beginning of this year, whilst it's been a bit difficult for the past few years with COVID and other things, we're certainly seeing this year an uptick, which is is great in terms of the European business. Obviously, the the NHS coming online is additive to that. Germany is additive to that, and The N A and The U The US, which is the biggest piece. We're now starting our early access programs, which we've just talked about. So growth has started. In terms of then the second part of that, which I think was Steve's question about when would we see that we don't require any further investment.

48:23 Realistically, I think we're looking at forecasts that would turn us towards breakeven and profit in about two years from now, twenty four months. That's based on our internal forecast to give you an idea. So, yes, in the future, we'll be looking at investment, but this is likely to be the last round, this next round. That's our intention. I don't know whether that helps, Steve. And I guess in terms of investment, we don't mean development investment because that's everything has been developed. It's more about the clinical studies and the investment in the in the labs and the equipment and the people, which is what we have been investing in over the last couple of years. Steve's second question is The US opportunities look very good. How do you see this scaling within lipid encode, and what can we expect to see as a sign of market penetration?

49:14 So so the first let's go slightly in reverse then. The first sign of penetration is we want to see some good revenues coming through as quickly as we can, but we gotta be realistic as well. So we'll see The US generate revenues this year from lipid and code, and we expect cardio and code also to have revenues this year even though, you know, obviously, it hasn't got reimbursement in the same way that lipid and code does. So we've led with lipid and code. The pull through has come for cardio and code as well. So the two, to some extent, I quite like the idea that they can complement each other in terms of selling in the market. It's much easier to go with two products as an offering. So we will see that that revenue coming through. In terms of then the first half of your question in terms of how are we doing that mechanically, it's like I said that the first quarter of this year was driven by getting those beginning the tier one access programs, early access, and that started. So we've had a really good hit, and I know that in the second quarter, it's similar, and we'll continue to run that mechanical model out. I like the idea of talking to the the new clients, explaining to them what we do, and I'm, you know, I'm spending a a lot of time in this process with the clients.

50:21 And of those clients, just so you know, they're they're they're slightly different shapes and sizes. Some of them are we're looking at big contracts with them or bigger contracts to move to commercial commercial phase. Some of them are quite happy to order on the back of they're starting to use it, and they want to buy more of it. So there's a there's a little bit of value and benefit in that, but not everything has to have a big mechanical, you know, heavy contract wrapped around it. For us at the moment as we move product into market, so penetration, sales revenue, and growth year on year are the key measures, Steve. Next question is from Andrew. Andrew asks, do internal budgets and forecasts show that there is enough cash to get to a cost cash positive position, or is a further capital raise envisaged?

51:08 So maybe I'll kick start that one. And, Matthew, maybe you can add. So our current plans are that we would break even in two years' time, as Matthew mentioned, I think, a little bit earlier. And on our trajectory, we will need to do another raise between now and then. We could cut costs severely and change our strategic approach and probably could make that without a cash injection. But, I think the right way of doing it is to do a further raise between now and then. Did you want to add Yeah. No. No. I I think that I think that's fair. I mean, the other some point to say is that, you know, we we're also driven by not only running the business and driving it forward, but we have to keep an eye on where the financial markets are. And when we when we drew down the funding two years ago, we we we said we would raise money for two years. And at the moment, so the expectation expectation was was that that maybe the markets would be still open for business.

52:09 It's difficult. The markets are not. So we we obviously keep an eye on that that process. But at the moment, we're busy. We're busy finishing and delivering and moving our products into market, generating that upside on revenue, and positioning ourselves so we're in the best possible shape when we do decide to invest. But it would be, you know, as Paul said, we we gotta be realistic. We've gotta raise sufficient funds when it's when the time is right to make sure that the business gets the breakeven and profit position. But on the way there, there'll be plenty of indicators and performance measures that will show that the revenue and the top line is growing healthily and in the right direction. David has asked the question. With further fundraising probably in 2024, many small investors would be discouraged as equity fundraising will almost certainly be at a discount to the then share price.

52:57 So, again, maybe I'll kick start and Matthew can add. Maybe. Maybe not. We have some very, very positive news coming along. You know, Matthew mentioned the submission of the the FDA filing and, obviously, the results of the FDA filing. I think that is presents a couple of enormous opportunities for investors to get in at a price which we think is, you would expect us to say, very much undervalued at the moment. And all market indications are that that there is an awful lot of value to be had from GENINCODE. So, yes, maybe, but we we we expect not. So whether you want this word. Yeah. I mean, again, we we have to drive the business, generate against the plans we've set, make sure that we hit those revenue targets, and present the business in the best possible light given the conditions on the financial markets. But we can't do much about that. The sector, the industry, technology, and small cap stocks are not in favor, and therefore, we have to move with that, you know, rising and falling tide.

54:02 But, no. There is a lot of good good news and things happening in the company. I'd like to believe that that was commensurate with the share price movement upwards, but it doesn't always happen like that. So in the meantime, we keep very focused on what we need to do, and the intent is to continue to build and drive real value in the company offering so that from an investment perspective, whilst things are down, and we're we're obviously very aware of that, that it will recover significantly. And David has asked us a second question. Is there an alternative to equity fundraising at a discount such as finding a cornerstone investor? And, yes, the answer is, clearly, yes. We have a very supportive investor base at the moment, and we would fully expect those to continue supporting us and and and Cornerstone fundraise as and when we do that at the right price as well.

54:54 Yeah. I mean, as you might expect, we're we're considering and as we move closer to an event like that, we'll consider lots of different things. But, yeah, it it isn't only one way, one route, one back to the capital markets equity raise in the way that traditionally maybe that was a norm. We are thinking about things in a in a different way. There is a a good thing that there were a lot of what we're doing in activity is US based, so that's helpful too. So that kind of perhaps opens up other opportunities. And, yeah, we may have to think smartly about how we go about it, but one thing we're very fortunate to have is some very solid, supportive, strong investors. We stay very close to them. I try and keep them updated as fully as we can. We've obviously got a day job to do to run the business, but I think all of our investor groups that have been party to the the journey we've been on so far are fully aware of where we are, the delivery of the company, how we're operating. But yeah. So we will consider many of those channels and different opportunities as we get closer to a funding event.

55:56 And Roger has asked a question. If you run out of cash q q one twenty four, I assume you will have to come to the market q four q three or q four this year. That's what our current plan suggests, Roger. But, you know, as I mentioned earlier, we've our our cost base is is quite flexible. We don't have any big, big fixed costs that we cannot do anything about. So we can dial the cost expenditure downwards to extend the rush runway if we so wish, but wouldn't be exactly in line with our strategic plans. But that means that we have got a little bit of flexibility as to when when we want to do that. Yeah. I mean, you know, you you we run the business, and we run it really tightly and keep it really as you know, minimally in terms of the investment to keep our runway and cash position as as strong as we can.

56:54 But as you're starting to lift off, as you're starting to move and the revenues are starting to go in, what you don't want to do is start to go in reverse because you you've got, you know, thought process. At the same time, we have to keep an eye on that. So our preference is to continue to get air under our wings and move forward with the sensible rays when when the time is right. But we have quite a lot of things that we gotta deliver between now and then, and we're on with that at the moment. So, no, I think we're pretty well placed. But, yeah, it's a fair point in terms of thought process, but, know, being I don't think I wouldn't be too specific just yet as to the exact timing. Thank you. That's it as far as q and a. How about for you, Alessandro, for a wrap up? Yeah. Matthew, Paul, thank you very much for that. I think you've addressed all those questions from investors. And, of course, the company will review all the questions submitted today, and we'll publish those responses on the Investor Me company platform.

57:44 But just before redirecting investors to provide you with their feedback, which I know is particularly important to you both, Matthew, could I just ask you for a few closing comments? Yeah. Thanks, Alexander. I haven't prepared anything, but just to simply say to everyone who's followed and come on to the call, thank you. You're clearly interested in what we're doing. Please keep your your ear to the ground and follow us as we move forward. We're in a an exciting period. Doesn't necessarily, as I said, reflect that in the share price, but I think at the same time, you can be rest assured that there's a lot happening at at levels at which in terms of what we do as a company. Whilst we're very small, we work with big leavers in The US and the European market, and I expect us to see, significant growth over the coming years. So I hope we've given enough insight to that, and we've set out a plan that you understand and it's clear. If you're if it's not, then please reach out to us. I'm more than happy to follow-up with you individually.

58:39 But thank you for your time today, and and, yeah, please stay in touch if if you want to follow-up with us. Matthew, Paul, that's great. And thank you very much for updating investors today. Could I please ask investors not to close the session as you'll now be automatically redirected to provide your feedback in order that the management team can better understand your views and expectations? This will only take a few moments complete, but I'm sure we're greatly valued by the company. On behalf of the management team of GENINCODE PLC, we'd like to thank you for attending today's presentation, and good afternoon to you all.