Shield Therapeutics (LSE:STX) — Business Update for Q1 2024 and Confirmation of Key Financials for FY 2023

0:01 Good afternoon, and welcome to the SHIELD THERAPEUTICS PLC investor 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 received during the meeting itself. Have the company can review all the questions submitted today, and they'll publish responses where it is appropriate to do so. Before we begin, I'd like to submit the following poll. And I'd now like to hand you over to CEO, Greg Madison. Good afternoon to you, sir. Great, and good afternoon, everybody. Thank you for taking the time to join us. I'm joined here today by, my chief financial officer, Santos Schoenberg, who joins us and will, take part in the presentation along with the q and a. And our colleagues from, Walbrook will be managing the q and a today.

0:47 We'll do our best to get to all the questions that are being submitted across the board, and I look forward to receiving those and going forward from there. So, thank you for taking the time today. I think it's really it's a very it's it's a very good time for us to

1:01 kinda have a discussion overall and a reminder for what we're trying to do here at SHIELD THERAPEUTICS with our product, ACREFER. Right? And it's put on the title right here where we are really focused on changing the way that patients with iron deficiency with without anemia are being treated today, both in The US and globally. And that is our mission. It's like, how do we make Aquifer the oral iron treatment of choice for patients suffering from iron deficiency with or without anemia. That is our mission. We remain steadfast in that mission across the board, and we're very focused on accomplishing that goal, both ourselves and our current partners across the globe, and we'll go through that across throughout the presentation today. So we'll be making forward looking statements, so make sure that you read appropriately all of the disclaimers here as well.

1:49 So what are we doing here at SHIELD? Right? So on the left hand side, we've got our product, Aquifer and Ferrocrew. We've got a significant market opportunity that we can kinda compete against these OTC irons that are just, you know, very challenging for patients and physicians alike. You get an experienced team here in The US that has extensive commercial experience and knows how to launch drugs and build brands, we got exactly exciting, compelling ex US partnerships, you know, across the globe that are really starting to see see some important milestones that we'll talk about here as well. One of the things that was really nice is that I recently returned from a national sales meeting here in The US with all the SHIELD organization as well as all the VIATRIS sales organization. So our 100 person sales team, our 12 frontline managers, all the associated people that go alongside that, it was an amazing meeting. One of the things that really caught me, you know, or maybe two or three points here is, one, just the energy, the enthusiasm, and the motivation to make this work and really achieve that goal that I outlined before, which is we see patients, we see physicians day after day struggling to get these patients treated with iron deficiencymia.

3:00 We believe we have an excellent product and the focus and the goal on how to achieve that. It was palpable during that meeting as well. Number two is the collaboration between the two organizations was just outstanding across the board. And last but not least, we actually had the benefit of having a couple of physicians come in and speak to the sales organization. One was an OBGYN, the other was a primary care nurse practitioner, and it just reinforced just over and over again how clinically important it is for what Acrevor can do for these patients as compared to these OTCs. It just really struck home just how big the opportunity is, how challenging it is for patients, how good our drug is, and how much it can fill a need, but it also emphasized just how much more work we need to do to drive that awareness and really start to build that. So we've made tremendous progress. We're gonna keep working at it. We firmly believe that we achieved this goal. It can provide tremendous shareholder value, and we're excited about the work that we're doing day in and day out.

4:02 So let's just dive into a little bit as I reflected on the physicians and some of the comments that they made here. So iron deficiency with or without anemia, it is super prevalent disease. We've commented before that there's up to twenty million, US, Americans that suffer from both iron deficiency with or without anemia. You know, it's caused by malnutrition, malabsorption, bleeding, very prevalent, especially across women's health, IBD, and CKD, the three main areas that we tend to focus on within our target audiences. This disease is actively diagnosed, and it's actively treated. The challenge that we get into here is just the options that they have to treat this disease are fairly limited. So what that looks like, and this is consistent that we see across the globe here, physicians really had two choices. One is oral iron replacement therapy, and the second is IV iron. So the vast, vast majority of guidelines out there recommend first line treatment as oral iron replacement therapy for obvious reasons. IV iron has to be done in a hospital infusion center or hematology clinic often here in The US. It's just not a first line option for the vast majority of patients. So if we focus our attention on the left hand side here, when physicians reach for an oral iron, it has predominantly been OTC irons or the counter irons, mostly ferrous salts. Right? So ferrous fumarate, ferrous gluconate, ferrous sulfate are the common ones you can see here overall. Ninety three percent of the prescriptions that flow through on that side are from these ferrous salts. Right? That has

5:34 been decades and decades in the making. It's just habit. It's reflective. That's what they have. They know they're not great, but that's all the only option they really have across the board here. So what is the challenge? What is the need that's out there in the marketplace? And you hear this over and over again from both physicians and patients that the universal problem is that patients are struggling to treat this disease because they cannot tolerate the GI side effects of these oral iron salts. Right? They dissociate in the stomach. They irritate the lining of the gastric mucosa. They create reactive oxygen species, and this whole cascade of GI related events ensues. Up to sixty percent of patients are gonna discontinue their treatment with ferrous salts. And if it's left untreated, which physicians do not wanna do, ultimately, the patients may have to end up on IV iron, but there's a big, big gap that sits there between both of those areas.

6:26 So this is what happens. Patients get put on an oral or placed in therapy. These ferrous alts, You get this kinda, you know, period of switches and discontinuations while they're still suffering from the disease. You got untreated iron deficiency anemia, which is documented side effects that if the treatments if iron deficiency is not treated, bad things will happen down the road, and ultimately, patients may get put on an IV iron. So this is exactly where we are positioning Acrevor. Right? Acrevor is finally it's a terrible oral iron that normalizes both the hemoglobin, ferritins, T cell levels, and also voids the patient's need and requirement for IV iron. So the prevalence of people that get started and discontinue OTC irons is very, very significant. Aquafer occupies a very, very unique spot, and we got a formulation we think that can solve this need.

7:18 We've talked before about Aquifer's ability and its unique MOA. So Aquifer is a ferric iron surrounded by a maltol structure, which basically creates a complex which shields the iron, which allows the iron to get down to the duodenum where iron is absorbed by the body. Right? So it bypasses that dissociation of the stomach. It doesn't break down. It doesn't oxidize. It gets delivered to where the iron is absorbed. And in our clinical trials, very profound increases in hemoglobin and very profound and, low discontinuation rate in average reactions. So we heard from physicians that presented to us at the national sales meeting that this profile and their clinical experience mirrors exactly what we saw in these phase three studies. So we've got a product here that we believe really fits a nice, nice need. It's very effective, very tolerable, and We're super excited about the work that we continue to do here.

8:15 Important to recognize as we step back, it's a big, big market. As I mentioned before, twenty million patients, here in The US suffer from iron deficiency whether or anemia. There's over 13,000,000 prescriptions written every single year, again, for most of these OTC irons. We know where those irons probably those prescriptions are written. Vast majority comes out of general practitioners and OBGYNs, which exactly where we have our Salesforce deployed. It's a very unsatisfied market. And then lastly, there's been little to no innovation for many, many years. So, you know, in one hand is you got this really big market. You got a clear unmet need. On the other hand, you've got, you know, no real innovation, and we gotta kinda raise awareness and get this work done. And this is, you know, what kinda gets us out of bed, every single day is to drive that awareness, get in front of physicians, talk to them about our product, Aquifer, and really ultimately help benefit, patients on the back end.

9:11 So, clearly, as we undertook this mission starting last year, we identified a really great partner in Viatris. I commented before about just the energy and enthusiasm that I saw from both teams at the national sales meeting, both the SHIELD team and the Viatris team. Honestly, from most of the work there, you couldn't tell who was SHIELD and who was Viatris. You just had a very, very focused group there on accomplishing what we need to do. I can't speak highly enough about the partnership that we have with our our core team there as well. So before we dive into details on the first quarter update and some of the financing opportunities that we undertook, I wanna talk about our ex US partnerships and our global partnerships continue to progress. We've got some really important partnerships. What's really nice is in 2024, some really important milestones are gonna be start to achieve here as well. So starting with Neurogene, our partner in Europe, they sold over 90,000 packs last year in 2023.

10:06 That's a year over year increase of 10%. The Neurogene continues to perform, over year over year on a very consistent basis. And, obviously, we issue capture royalties, milestones associated with that as well. The three remaining are our three development partners in Canada, Korea, and China. CHI has submitted their application for approval, to Health Canada. We do expect an approval on that sometime in 2024. And with that, we get an approval milestone and double digit royalties on net sales, and we'd be very, very excited to get, you know, a partner to the to the north as I sit here in Boston to get the approval there and get that out in the hands of patients as well. In Korea, we made nice progress. We've completed our pharmacokinetic or PK study. As a reminder, that was the sole study that was needed in order to file for approval. That study has been completed. We expect our partner in Canada, KP, to, file for approval here in mid two thousand and twenty four with timeline for potential approval and launch in that marketplace sometime in 2025.

11:09 And then last but certainly not least, China, their phase three study continues to progress. We expect that the last patient into that study should be accomplished here in 2024, and the timeline for approval on that is second half of two thousand twenty six. We have a nice milestone there of $11,400,000, upon approval there. So that's certainly when we keep a a close eye on here as well. So net net across the board, all of our global partnerships continue to progress, We'll and certainly keep an eye out for other opportunities to expand the opportunity for patients to get access to ferric maltol, whether it be Acrefer or Ferrocru across selected geographies. Alright. So one of the things we highlighted in the results today was kinda trying to close the book on 2023 and some of the the the numbers there.

11:58 Let me turn it over to Santoshambag, SHIELD CFO, to walk through this slide.

12:04 Perfect. Thanks, Greg. Hello, everyone. Let me briefly go through the financial highlights for 2023. Now these are consistent with the trading update we had previously provided on the February 21. We are reporting 17,500,000 in total revenue and other income. Now this includes 11,600,000 of AccraFit revenues. That's a three x increase over 2022. It also includes the 1,500,000 in royalty revenues from product sales in Europe. That's by our partner, Norgeen. And also the 4,400,000 from other income including the recognition of the Beatrice initial milestone payment. You'll see in the middle of the slide, we have reduced our operating loss from 49.8 in 2022 down to 31,100,000 in 2023.

12:53 Last but not least, we ended the year with 13,900,000 of cash on hand. And, again, reiterating our guidance that we will be able to return cash flow positive in the second half of twenty twenty five with our current resources.

13:09 I will get more I'll get into more details on this in the upcoming slides. A very quick note about our year end audited financials. Our year end audit is almost complete, and these numbers that I just talked about will remain unchanged. We are working with our auditors, Mazars, to finalize the translation of the group's presentational currency from GBP to USD. Now this is the first year we will be using USD as our presentation currency in our audited financials and, hence, expect to issue our fully audited results for full year 2023 before May 10. That is end of next week. With that, I'll hand it back to Greg and take questions at the end. Thanks, Santosh. Appreciate that. Alright. So let's shift into our current business and how we look at things going forward here. So our 2024 business priorities are listed in the the colored circles on the top here. So across the board, we're focused on really three things. Right? One, grow AccraFire prescriptions and improve our gross to net particularly here in The US. That's more of a US focused goal.

14:15 Santos just alluded to, we firmly wanna get on that cash pardon me, that pathway to cash flow pause in the second half of two thousand twenty five. We'll speak more about some of the the strengthening of our financials through the work that Santosh and team have done during the first quarter here. And then last but certainly not least, going back to the previous slide, is expanding our global patient access to ferricmaltol. That's working alongside our partners across the globe to expand that, but also completing our pediatric study, which is ongoing right now. So going left to right as we kind of talk about some of the highlights of the first quarter, then we'll dive into details on each one of these areas. During the first quarter, we had 4,000,000 in net revenues for US Aquifer. We achieved just about 28,800 prescriptions. We had a 140 net sales per prescription across the board, and we saw an increase in our prior authorization prior pardon me. Prior authorization submission rates. So we'll go through each one of those in detail. I think from a macro perspective, we observed, you know, several really encouraging growth

15:16 signals during the quarter. You know, some of these or many of these were dampened by the issue that we encountered in Texas, which we'll cover off in detail, but we feel very good about some of the underlying things that we're seeing there. And we'll walk through each one of those here as well. Santos, you wanna just give a highlight on the pathway to cash flow positive, a couple of pieces there as well?

15:35 Yeah. Sure. You know, as I've mentioned before, we are reiterating our guidance that we will be able to turn cash flow positive in the second half of twenty twenty five with our current resources. Now this is supported by a new 10,000,000 accounts receivable financing that we secured in q one, and a really tight cash burn. We are exiting q one with about 10,400,000 cash on hand. And, additionally, we have also favorably revised our revenue covenant, associated with the SWK loan. I'll get into more details on an upcoming slide, but those were the key highlights from a q one perspective in terms of, strengthening our balance sheet and our cash projections. Excellent. And as I noted, we got some really exciting global partnerships of our third priority. Only I didn't touch on is the pediatric study.

16:25 That's an ongoing study that we're running both for the FDA and the EMA. That pediatric study, We should complete enrollment in that study mid part of this year and, hopefully, have top run results in the second half of this year. So that would, in essence, you know, if approved and get an expanded indication, open up an additional growth opportunity both in The US and in The UK pardon me, the the EU. And so a very exciting, you know, ongoing study here, and we look forward to getting those results out the second half of two thousand and twenty four. Alright. So let's dive into a little bit of details here. Right? So as noted in the release today, you can see our overall AcreFer prescriptions and what we accomplished during the first quarter. Since the partnership with Viatris back in the q two of two thousand twenty three, we continue to see a very nice acceleration in our growth. Q one came in at 28,800 prescriptions.

17:19 Now there's a growth of 1% versus q four. You know, obviously, over year growth of a 174%. As noted, we saw some really encouraging growth signals here that, unfortunately, a bit offset by a decline in Texas what we'll go through. But, you know, to point out here, really strong growth in two key states that we had highlighted back in September of last year once we got Medicaid access in both California and New York, which, by the way, are the number one and number two populous states in The US and also the two largest state Medicaid programs. We focused on those as a potential growth opportunity. We're seeing those deliver, which is great. Now that was offset by a 28 decline in Texas due to a change in the Medicaid pharmacy benefit manager. We're gonna talk about that right now. So, you know, certainly encouraging signs that we'll walk through right now, but certainly faced a a challenge here with with Texas. Let's walk through this.

18:14 So on this slide, there's a lot of, you know, numbers and graphs and things like that. So we'll kinda walk through this in a little bit of detail. So this gets in a little bit of a Zoom look to Texas, which is a bit unusual for us, but there was a, you know, enough that warrants here kinda going to a bit more detail. So first and foremost, folks should recognize Texas as a state for us represented about 35% of all AcroFire prescriptions written in the second half two thousand twenty three. So it is a very big and very important state for us. Also, as you'll see growing, pardon me, on the graph, the left hand side, over the past four quarters, and if I actually extended this back all the way to the launch, Texas has been on a very, very big growth trajectory. So you can see by the graph, we've been averaging about 20 almost 25% quarter over quarter growth in Texas driven both by Medicaid business highlighted in blue and non Medicaid business or commercial business for the most part, highlighted in orange. So physicians very early on started writing the drug, see the clinical benefits of the drug, patients have been benefiting as well. It's been a really important growth state for us across the board.

19:22 So Medicaid, you can see, on average, has been running roughly about 40% of a quarter business. So Texas is 35% of our business as a whole. Medicaid's been running at about 40% of that overall business. So what happened? So the PBM or pharmacy benefit manager, which basically oversees Texas Medicaid to ensure you've got, you know, kinda consistency in approach. You've got, you know, an you've got consistency in terms of the way the PAs are kinda submitted and approved across the board. The PBM that was in place all through 2023 left at the end of the year. So as of December, they exited. The new PBM did not start until April 1. So during this quarter period of both transition and a gap, what happened across the board was all of a sudden PAs that were being submitted by physicians for Acrofor to get approved, we started or they started getting back a lot of inconsistencies on extra data that's being required, right, where they had never seen that before. So if physician offices, in essence, started to get flooded with requests around PA submissions, different data points folks wanted to see, and there was no consistency whatsoever.

20:36 So we at SHIELD started to hear about that very quickly from our physicians across the across the, the state of Texas. Our challenge was there was no PBM in place during the first quarter in order to engage with them. So we're a bit firefighting on the fly here, and our teams in Texas did a very, very good job of trying to stay close to the issue, work with their physicians, and realize what was happening across the board. But as folks can imagine, you know, you start getting inundated with requests. It's putting a burden on the office staff or putting a burden on physicians. They, in essence, said, you know what? You know, for now, we like the drug. Until we get this kinda clarified, we're basically gonna, you know, diminish or stop writing for Medicaid patients, and we'll focus on other areas of business. So we saw a 28% decline just in the state of Texas during that first quarter across the board. So frustrating for us, you know, candidly, because you had patients that were already on the drug, even refills get caught up in this effect in new prescriptions. So it had a very large effect on our overall business, you can imagine.

21:39 Now the new PBM stepped into place as

21:41 of April 1. We are already engaging with them, and our goal here is basically to get back where we were before, which is we need consistency. We need consistency that when a physician submits a PA, we know exactly what is gonna be required of them, and you don't get, you know, multiple requests back and forth and reduce the burden on the staff, but also ensure that patients have access to the drug. So that's what we're focused on right now. But in that first quarter, this had a very, very big effect on our overall business just considering the importance and size of, Texas overall. So flipping on the other side, I mentioned, you know, we're seeing some encouraging signals. So what do those look like? I highlighted New York and California primarily because back in September, when we got access to these two very big states, we highlighted them as potential growth opportunities that we're gonna continue to accelerate our growth across the board. And bottom line, they're delivering. So on the left hand side, you can see California, New York prescription volume since we got access to the Medicaid programs there is really starting to take off. Right? We're seeing average quarterly

22:45 growth of 40% in each one of those states. And I put Texas up on the right hand side just as a reminder of, in a similar situation, what did Texas and what were they able to do. We fully expect that the quarterly growth we see both in New York and California portends very, very nicely to continue our growth acceleration. We'll work through the Texas issue, but, really, we're very, very encouraged by some of these big states. And the more physicians that now write the product, get clinical experience with it, we can start to drive depth across each of those areas. So I think this portends very well for our business as we continue to move through thousand two thousand twenty four. On the access side, our access is excellent both on the commercial plans and the PBMs as well as state Medicaid programs across The US. In fact, you could see there's only really two states in The US that don't have the aquifer available in some way, shape, or form across their state Medicaid programs.

23:40 And then we also offer a very comprehensive patient access program available for commercial patients where if the PA submitted and it's not approved, we'll still get the patient on the medicine for $25 per month on Acrofor. So, you know, a bit of a safety net underneath. And our goal from our sales team perspective is let's educate the physicians on the benefits of Acrefer. Let's walk them through the clinical profile, why it's different than these OTC irons out there, and write the drug, and we're gonna do our very best to get them on the medicine. Right? Whether or it's a paid prescription optimally for us through commercial or Medicaid. And if not, we'll get them on the medicine through our patient access program to really start to build that clinical experience. So we've got, you know, virtually a kind of a best in class type of setup here across the board, which is very encouraging for us.

24:30 So let me shift now to the second priority. We talked about prescriptions, and then it's how do we improve our net selling price or improve our gross to net. And this is our, where we landed in q one in terms of the net selling price that you see listed in the chart here. So as a reminder, back in the first half of twenty three, we're roughly roughly about $119, net revenue per prescription. Second half of last year, that accelerated to a 145. We're coming in the first quarter at a $140 per prescription. And, again, this is heavily impacted by Texas, unfortunately. So I'm gonna walk you through improvements that we see in key indicators, like PA submission rates are moving very nicely. We renegotiated some very aggressive contracts last year on the payer side to kinda reset our Medicaid best price.

25:19 Both of those portend very, very well to achieving our goal where we wanna be in 2025 on our gross to net. Unfortunately, those are dampened right now with the loss in Texas. Right? And the Texas issue hits where we lost a lot of paid prescriptions that really kinda mitigated the effect that we wanna see, underneath on improvements in the gross to net side during the first quarter, but we're very encouraged with some of these underlying signals that will actually start to, be more apparent as we move throughout the year. Speaking first of the PA submission rates, again, back in September, in addition to highlighting opportunities in California and New York, we're very deliberate to say we need to improve our net selling price. And one of the key key key things for us is how do we improve our prior authorization submission rates by physicians. Right? So, you know, physicians will help them with the form, but they ultimately need to submit this PA into the, plans.

26:14 We made a very specific change to our patient access program where physicians

26:18 had to submit a prioritization before patients can actually qualify for that $25 cash price. You can see some of the effects listed on the graph here, as well. We jumped from, just under forty percent in the third quarter of last year. We're up to almost the mid fifties at this point in the first quarter two thousand twenty four. That's a very significant decrease in a very short period of time, all tied to that deliberate change in our, patient access program. In addition to that, what we're very, very excited about is in September, we also highlighted that we plan to to hire and deploy a field access team. That team is now hired. They're deployed as of April 1. And the goal of this group is they are not salespeople. Their primary goal is to help educate and support office staff on prioritization submissions.

27:07 Right? So oftentimes, there may be confusion or they may be not be filling the form out correctly. This team is out there to provide support education with the explicit goal to increase that PA submission rate across the board. So between changes to our patient access program, the deployment of the field access team that's been out there for now a couple of weeks, we feel very confident that we're gonna continue to see the growth in this area that, again, you know, displays very well for our achievement of our improvement of our gross to net or improvement on our net selling price. So very, very excited about some of the underlying issues that probably underlying leading indicators that we see there. And, obviously, we'll we'll work through the Texas piece to mitigate that as well. So I'm gonna turn it over to Santosh. I think there was a lot of work done by he and his team here to get to strengthen our, you know, financial situation, to improve our flexibility, and let him walk you through some of the accomplishments that were achieved during the first quarter. Santosh, I'll turn it to you. Cool.

28:06 Thank you, Greg. As I've mentioned a few times before now, we expect to turn cash flow positive in the second half of twenty twenty five with our current and existing resources.

28:16 A tight control on cash burn has enabled us to exit q one with about 10,400,000 cash on hand. Now our ability to turn cash flow positive is also now supported by a new 10,000,000 accounts receivable receivable financing that we secured in April with Sally Port commercial finance. It is a non dilutive working cap financing and actually helps us to proactively manage our working capital by accelerating cash collection on accu AccuFair sales in The United States. The facility is securitized by AccuFair accounts receivable, and has pretty business friendly terms. Interest rate is at prime plus 3%, and the facility is available for a minimum of twelve months, and it can actually be extended at current terms for an additional twelve months.

29:05 In the middle of the slide, you can see we have also favorably amended the financial covenant of a rolling twelve month minimum revenue target that is associated with the existing $20,000,000 debt that we have with SWK. The details of the change of the minimum revenue targets have been provided in the release this morning. The amendment also came with a small change to the final payment fees. The fee changed from 6% to six and a half percent. All other financial terms remain the same. So in summary on this slide, you can see we have strengthened our balance sheet to the accounts receivable financing. Number two, we have favorably amended our existing debt facility agreement with STM UK. And number three, we expect to turn cash flow positive in the second half of twenty twenty five with our current and existing resources.

29:57 I'll pass it back to you, Greg. Great. Thanks, Santosh. Alright. So in summary, as we look at our key milestones in 2024, to reiterate, our key focus areas for us, internally, We're focused on growing Agrofur prescriptions and improving our gross to net. We're focused on that achieving that pathway to cash flow positive in the second half of two thousand twenty five. And last, and certainly but not least, expand our global patient access to ferricmaltol. We've got a lot of exciting milestones here. We have growing active prescriptions here in The US along with the revenues, continued improvement in the gross to net driven

30:34 primarily by that increase in PA submission rates. Santosh has walked you through a lot of the accomplishments we did in the first quarter to strengthen and give ourselves flexibility on the financial side in order to hit that cash flow positive by second half of two thousand twenty five. Now we've noted a lot of the milestones that are coming up, you know, in 2024 alone between, you know, our partners in Korea, Canada, China, and we expect to complete enrollment of that pediatric study, which would lead to potential filing for approval in both, The US and, and, in Europe as well. So prior to taking any questions here, I think in summary, as we look at the quarter, you know, to reiterate, we saw some very encouraging growth signals across the board. You know, New York can apartment, New York and California primarily, Excellent growth that we see there as well following the expansion of the Medicaid access.

31:24 Good indicators on our gross to net improvement, particularly with the PA submission rates. We're really happy with the results we saw following the change in the patient access program. We're excited to get the field access team out there as well and start providing that support to physician offices. Our ex US business continues to progress along here as well. Obviously, we had an issue in Texas, which we're on top of. We need to get that rectified. And rest assured, the team is very much hard at work here in trying to get that turned around and addressed primarily for the benefit of our patients and our eye health care providers as well. So we remain very, very focused on our long term goal of what we're trying to accomplish here in changing the way that these patients are treated for iron deficiency with an anemia. We think we have an excellent product, and

32:11 gonna stay focused on execution of what we need to do and how we can control that. And with that, we believe we can drive ultimately a very, very successful product and ultimate shareholder value here as well. So with that, let me pause. I think we've got a number of questions. I'm gonna ask my team at Walbrook here to help Santosh and I out and, you know, read off the questions, and we'll, again, we'll take as many questions as we possibly can with the time we have allotted here as well. So thank you for submitting those and Walbert, let's take that away. Perfect, Greg, Santos. Thanks very much for your presentation. Ladies and gentlemen, 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. As you can see we have received a number of questions throughout today's presentation and at this point if I can hand up to the team at Warbrook who are going to manage the Q and A, I'll pick up from you at the end.

33:00 Thank you. So we've had a number of questions,

33:04 a few of them along similar themes. So trying to group these as best we can. First one is on sales. How will you guarantee that your sales targets are met this year? U. S. Was missed. Is there any risk assessment and risk mitigation for the coming years? Yeah. I'll take that one. Look. So coming off the national sales meeting, like I said, couple of weeks ago, we spent a lot of time with our teams, overall just to think the the things we wanna do to be able to control what's in our control is, like, let's make sure that, you know, clinically, we're up to up to speed on what we need to clinically, how do we differentiate our drug, how is it different than some of these OTC irons as well. Let's focus on calling in the right physicians with the right amount of frequency and the right message. So some very, you know, kind

33:55 of basic blocking and tackling, that's how you can execute here as well. Compliment that with, you know, some of the additional marketing resources we brought to the team. We updated the new sales aid for them, which makes this whole, you know, messaging, you know, much more clear, much more specific, and ideally should result in more impactful presentations across the board. But I think for us, it's really just good, strong focus and execution of right customer, right message, right frequency, and then follow through, follow through, follow through. As we heard from physicians at the national sales meeting, we've got a great product. You know, I think all of us fully believe that. There is a need out there, and a lot of this is just really good solid execution. I will say awareness is still lower than we'd like to see it, so we gotta continue to find ways to increase that across the board through not just sales efforts, but with marketing efforts as well. But we remain confident in the product, the market, the opportunity, and in order to achieve our goals, we just have to really dig down and execute as best that we possibly can. And that's what I walked away from that national sales team with is very everyone very much locked in on what needs to be done and the opportunity that really sits here in front of us.

35:06 Great. Thanks, Greg. While we're on sales, just moving to ex US, can you provide any update on Noregene sales figures and perhaps give a flavor if it's already in the market and expectation around ex US income for the rest of the year?

35:25 Yeah. I'm not going to comment on ex US income for the rest of the year, but I will say as noted in the presentation that Nordgene increased their pack sales 10% 10.5 year over year. So continued good steady growth. We continue to work with them on, you know, making sure that, you know, calling on the right audience. It's not dissimilar what I just stated. It's we got a great product. There's a great opportunity. It's right customer, right message, and, right frequency. Right? So similar kinda blocking and tackling on sales execution, marry that with, you know, some good, marketing strategies to try to provide both air support to your sales team, but also how do we expand that, that, that reach and that awareness level as well.

36:11 Great. Thank you. You're welcome. While we're on ex US, a few questions around where you're at with China,

36:21 also what's happening with Canadian approval?

36:24 And do you have any other targets target markets on your road map, maybe India? There's a few questions there. India. Yeah. Interesting. So as you noted in the presentation, so China, they continue to enroll their phase three study. That's picked up nicely over the past, you'll call it, several months versus where it was before. Probably according to our partner, they're expected to finish last at least last patient into the study before the end of this year, which would be great.

36:53 The timeline for approval there would be the second half of two thousand and twenty six. So encouraged by some of the progress that we're seeing there. And as noted, that's a a pretty important marketplace for us, with the approval milestone sitting out there. Canada, you know, been in active dialogue with our partner, CHI Pharmaceuticals. As folks remember, CHI last year submitted to Health Canada. At first, were told it might be midyear, then by the end of the year, and here we are in '24, we still don't have any decision just yet. What I can share is that we've got no clinical questions or CMC questions, so there doesn't appear to be any, you know, underlying issues in terms of the data package. CHI is engaged with Health Canada. What we've been told is that we should expect the decision here in 2024, which right now is relatively broad. But until I narrow that timeline based on feedback from Kai, we'll stick with the decision in '24.

37:44 Very, very excited about, as I sit here in Boston, you know, potentially getting our our partner to the north here approval for that product and really start letting patients benefit from the the benefits of AcroFer. And just a slight extension on that question. Someone asked with approvals in Canada and South Korea, how much would that add to expected sales market size? Are they actually of any relevance?

38:09 So I think, you know, when we look clearly, The US is the big focus. Right? That's where the vast majority of my time is being spent. That's where the vast majority of the team's time is being spent. That is not only one of the bigger markets, but with our partnership with Viatris, that's gonna really drive the revenues of the organization. Every other, you know, partnership we do is great, a, for the fact of we wanna get ferricmaltol out to as many patients and physicians as possible around the globe. So that's, you know, important from a strategic perspective to have that available overall. You know? But, you know, any of the milestones, royalties, and things, they all add to it, but it's not gonna overtake by any stretch imagination what we can do here in The US. That is gonna drive the vast, vast majority. There are some great, you know, milestones, royalties.

38:56 We wanna be able like, you know, take the benefit of those. But again, the real focus for us right now, while those continue to advance, is on The US to get that business up and running the way we expect it to be.

39:10 Great. Thanks, Greg. Just a quick question sort of extending on China and you might not be able to add anymore, but someone's asked why is the China study taking so long to complete with over a billion people to recruit from? I'm not sure if you can add anymore, closing it anyway. It's it's a great question. All I know is that that they definitely got caught up a little bit in terms of the COVID situation there, and I'm not gonna pretend to speak down to the the local level there. But, you know, things in China definitely lingered a lot longer than perhaps other parts of the world in terms of that overall impact. I do know that our team, is actively engaged with, ASK over there, in terms of, like, how they're progressing with that study and the timeline with that as well. As noted, we should be finishing enrollment in that study by the end of two thousand twenty four, which is great just to get to that milestone because then everything else after that is finalization, filing, etcetera. We can finally start to get on a clock where, you know, candidly, that enrollment has been definitely stretched out beyond what I would like to

40:12 see, but we have a a line of sight here to the light at the end of the tunnel, which is great. Right. Moving on to prescriptions. I've got a few questions here. How will you get on track with prescriptions and numbers as cited in research notes? I think someone on the research notes cited 65,000 for q one, 300 and 30,000 for the whole of 2024. Yeah. I can't really comment on the analyst notes, obviously. Right? The analysts will do their projections on the independent perspective, but what I can't comment on is just internally, like, what are we trying to accomplish. Right? And, obviously, we wanna continue to grow our prescriptions and get this product out to as many patients and turn this into the oral line of choice. Right? So as noted, if you look at q well, if I step back and where we were a year ago today versus where we are now, obviously, a magnitude jump. Right? We did the partnership with our partner, Viatris. We had,

41:11 I think, it was, a 3.1 increase over q one of last year in terms of prescription. So we've grown the marketplace. Now none of us internally sit here and say, alright. We're satisfied with what we've done. Right? There's just so much more that we can do. There's so many more physicians out there that still haven't written a product like Acrefer, so many patients that could benefit. So, you know, by no means of the imagination, we, satisfied. Right? We're pleased with the progress, but we're not satisfied. Q one, as noted, during the presentation today, some really good signals on offset by Texas. Right? The Texas is unforeseen issue that popped up, you know, on us all of a sudden in the January time frame where we're in a bit of

41:53 a firefight in our biggest state and a very big segment of the population. You know, there's a lot of frustration that we encountered here, particularly for pet patients. Right? We have patients that are on the medicine that even refills get kinda caught up in the wash of the the Texas issue here. So, you know, that that's kind of a isolated q one issue that we're obviously dealing with right now. But if I look underneath the hood, we're seeing good signs. Right? Texas, New York, we're seeing good signs of PA submission rates. Like, all those things will start to flow through, and it just we try our best to work on what's tackled in front of us. Sometimes obstacles come up. We gotta deal with it. We're working on that right now, but we're not losing sight of what our long term goal is. And if we can execute, and I expect we will based on the product, the opportunity, and our team, then we'll we'll we'll turn this product into the success we believe it can be. And with that, we'll bring along shareholder value, which is important to us as well.

42:47 Okay. Just extending on that. I I I don't think this is in the market, but correct me if I'm wrong. Someone's asked, what is the estimated US prescriptions for 2024? Again, I'm not sure if it's something you can answer or if it's out there. Yeah. We've not put out any official guidance to the marketplace in terms of prescriptions and things like that. Obviously, you know, we gotta as the as the as the year progresses, we'll consider if we, you know, choose to do that or not. As in as we just noted here in the first quarter, we got growth in certain areas. We got a Texas issue we need to, address. We are engaged with that, PBM. Physicians would like to write the drug to get their patients back to the medicine. That's our goal is to try to allow them to do that. The question is, like, how quick can we kinda fix this issue? How quickly does that business come back? So, you know, as we kinda go throughout the year, we'll consider if we provide official guidance. But right now, we're just focused on, you know, kinda solid execution day by day, week by week, and driving that growth that we need to see.

43:46 Great. Thanks, Greg. Staying on prescriptions, is the prescription data issue completely resolved? How can you assure this will not happen again? You you mentioned an enhanced multi source system in the RNS. What does this actually mean? Yeah. And let me speak to it from just a macro level, I'll say, Tosh, if you could comment on this as well since both of us have been, you know, joined at the hip across our organization. So, the short answer is yes. You know, we're very confident in the numbers we put out today of the the 28,000,800, prescriptions. We're working very closely, with our third party data provider. We get customized data from them on a monthly basis to make sure that, you know, whatever their projection methodology that they had identified is fully accurate.

44:33 So we're working extremely close with them, from that perspective. And then maybe, Santos, you can comment on some of the internal system we've put in place, from a a check as well. Yeah. Absolutely. Absolutely. And like Greg said, we have clearly, improved the proprietary and customized reporting that we have from a third party provider. Now in addition to that, we have implemented several internal controls as well. Some of them are automated and some of them are manual. We are working with our auditors and our audit committee to make sure that we enhance our controls. A couple of things that we have done is we've got different sources of data, whether it is a three p l provider, whether it is our warehouses, or if it or it's the supply chain in the in the market. So we take a look at all of this data, compare it to the data that we get from the third party provider, and and do a quality check of the numbers on a high frequency basis.

45:32 So given all of this, we feel pretty confident that not only has the third party supplier provided us with the prior proprietary and customized data, but our internal controls has also helped ensure that we have checks and balances to make sure that the data is accurate. Great. While we're with you, Santosh, a question around and I and I think you said it, but perhaps to reiterate. So with the new financing, cash in hand, expecting revenues, this gets you to cash flow positive in the second half of twenty twenty five. Is that without raising more capital? That that is absolutely right. So, you know, like I said in our prepared remarks here, we have truly strengthened our balance sheet and made our cash projections and and reliance on existing resources much more flexible. So by inclusion of the new working cap financing, where we're actually able to accelerate our cash collection on Accra for sales in United States, that's a $10,000,000 line, as well as the revenue projections.

46:40 And don't forget, we've also strengthened our cash burn in q one, and we'll continue to have a high hyperfocus on that. So all of that put together definitely puts us on a on a path to being cash flow positive in the second half of twenty twenty five with our current and existing resources. Okay. Great. And and does this include milestone payments? And in fact, are are you expecting milestone payments this financial year? Very minimal contributions from milestone payments. I think Greg alluded to the big milestone payment is actually from ASK in China. And that, you know, given the timelines and anticipations of the process with the PMDA in in China, I think think it'll it'll end up being in 2026.

47:29 So, you know, if that gets accelerated, then that only improves our chances of getting cash flow positive in the second half of twenty twenty five. Great. Moving on to Texas. We've got a few questions here. Did the Texas issue adversely impact other companies? If not, why not? How can one PBM create such issues? I'll park it there. There's a couple more, but I'll leave those two first. No. It's fine. I'm actually scrolling some of the questions here as well. Noted a few of those, so thanks for pulling those out here as well. So yeah. Look. The Texas issue, first and foremost, this was not a foreseeable issue. Right? So we knew that the PBM was gonna change. Right? So that that that much we had indication of. What we didn't know is, a, to be a gap between the new one coming in and the old one leaving, which, you know, obviously was news to us. The more important issue is even with the PBM leaving, our understanding based on communications was, you know, you wouldn't have a a change in the the overall criteria as it looked for managing prior authorizations. Right? So that was definitely a surprise both to us and to physicians.

48:41 So we had to react pretty quickly where all of sudden, every prescription going through, whether it be a refill or a new prescription, physicians are just getting flooded with requests. So you can imagine as we're trying to react, you know, real time here, you don't have a PBM in place to kinda get clarity across the board. So it create a lot of, you know, confusion, a lot of frustration, And, you know, that's really what the issue was in Texas, you know, for us overall. And you can imagine from a physician standpoint, we're trying to balance working with them, making sure the patients can get on the medicine they want them to get on. But at some point, it gets to a point where you're like, you know what? Let's just pause on the Medicaid side. We gotta get this figured out here as well. Let's think about focusing on not Medicaid, but a non Medicaid business.

49:27 We did actually see an increase in March of 6.5% in our Texas business that was non Medicaid as we kinda position physicians to say, you know what? We understand where you're at. We gotta get this thing figured out, but let's, you know, figure out what other patients can benefit from Macro for in the meantime if it's not your Medicaid patients. So we are absolutely kind of on top of that, a 100%, to see where it goes. As far as other products, I haven't had, you know, time to dig in to figure out how this may have affected other areas. I know what affected us, and that's where my focus has been across the board. So every product might get affected differently depending on exactly the product, the PA, whatever it may be. I know it hit us. We got caught up in the wash here. We intend to fix it. What I take note of is physicians. And this is a bit of a I guess, if it wasn't clear, there's a bit of a double whammy to us or a triple whammy, both in terms of you remember the chart I showed, prescription growth overall had been averaging very good strong growth in Texas. So not only in the first quarter did we not get that growth, but we had a decrease. So the magnitude of effect was actually pretty big across the board, both in terms of missing out on growth, but also having a decrease.

50:38 And as noted, it had a real effect on our average gross to net or net selling price, all driven by the state of Texas. So rest assured, our mission is they get patients there. They wanna get on the drug. Physicians wanted to write the drug. We've gotta get this logistical stuff kinda figured out and get the consistency back to where it was before that can allow that to happen. We're engaged on that. It's a big focus area for us, and we're doing everything we can to do that as quickly as possible. Thanks, Greg. Just a slight extension on that question. So so do you think Texas is a risk looking forward, and do you think it will come back to prior levels? Look. I mean, ultimately, I'd love to get it back to where we were before. Right? Physicians want the drug. Right? They like the drug. They've got tons of clinical experience. So, that part is great. It's not like they something happened where they don't like the drug anymore, all of sudden they stopped writing it.

51:33 That would be a whole different kettle of fish. This is a logistical issue that we gotta get figured out to make sure that for them, when they write it, they just wanna make sure they understand when I write it, what do I need to do, how do I get it approved, and just be consistent. Right? That'll make their their job easier, their staff's job easier. And as long as we know that, we can execute against that. Right now, we do not have that. That's the the biggest challenge right now. So, number one, you know, you see our Medicaid business already decreased pretty dramatically in Texas, if you will. As noted, we've pivoted them to writing for commercial patients in the meantime while we're engaging here. We're seeing some positive green shoots, you know, in the March time frame, on that. And, our ultimate goal would be to let them get back to where they were before, which is you wanna write it for patients, you know, that are suffering from iron deficiency with these OTC failures. We wanna get back to LOVIN to do that and, reaccelerate that growth.

52:29 And do you have a timeline for Texas to come back? I it would be premature right now to comment on the timeline. Just note that we're actively engaged. We're working on it right now. And when and if that kinda gets clarified or when that gets clarified overall, we'll certainly update the market, but it'd be premature right now to comment on the timeline. Are you seeing other areas of sales slowing outside of Texas? No. I mean, as noted, I mean, particularly in, like, big volume states like California, New York and recognize, you know, in The US, you're never gonna have, like, even distribution across all states. Right? So California, New York are two of the biggest populations in the country. Texas, I think, is, like, number five. So you're always gonna have a larger proportion of of of your sales in your prescriptions coming from these larger kind of popular states. We're seeing really nice growth. Again, we saw on average 40% quarter over quarter growth coming out of California, New York. That portends very, very nicely for us, and we're just getting started there.

53:31 Right? So by no means are we done or satisfied with the progress. I think it's moving in the right direction, but, man, we're just getting started. That ball's just starting to roll here as well. And then certainly as we look across the country, you know, again, just focus on what I said before, good solid sales execution, drive awareness, you know, continue to expect to see growth in all parts of the country here. Okay. Moving on. We've only got a few minutes left. This has been a recurring theme in terms of share price and a question, do the directors plan to buy more shares in the company? I suspect it's probably a question you can't answer, but do you have any comments on that? No. I mean, the only thing I can say is, look. I mean, we're we're very look. We're cognizant of where things sit right now. We're not, you know, tone deaf at all on any of that. But what we focus on is our day to day business and how do we just continue to grow this market, grow Acre for all the things we talked about, prescriptions, gross to net. There's some really good things there. And just rest assured, the dedication, the focus, the motivation, the passion, it's all there. Right? We are very, very driven to do that.

54:39 We always wanna move faster than we're currently moving here as well, but we firmly, firmly believe based on everything we have seen, recent market research. I can't tell you just how enthused I was by hearing from these physicians at the national meeting about their perspectives and, like, how their journey was to, like, introduction of AcroFer to now adopting it fully. It just shows us over and over again how much this marketplace is needing a product like AcroFer and our desire to kinda fill that void. Right? So if we can execute on that, execute the way we expect to across the board, then with that, we'll come the shareholder value. But rest assured, the team is fully hard at work, fully engaged, and, we're very motivated to make a success and bring all of you shareholders along with us and get our shareholder value where it needs to be.

55:27 Great. That's good. I mean, the question think you just answered it. You know, investor confidence is low. What else can you do to improve this? If there's anything else you would add to that, but I think you you just answered the question, really. Yes. No. It's just it isn't. I mean, what our goal is to, you know, make sure that communication is strong, right, keep you updated on, you know, the different parts of the business, but rest assured again that the team is fully hard at work and fully motivated to make success. And, you know, all of us in the company are shareholders as well, so we share the interest to try to drive this and make the success that we expect it can be, and we're excited to do it. Great. Just a final question, I think, here. Is your sales team of a 100 enough? If you're asking a guy from a commercial side, right, you know, when I say it's a 100 enough, I'd love to have more than that, of course. Right? But, I think it's enough for now. Right? I think the the marketplace, the way it's set up right now, you could certainly always use more salespeople, than you currently have. I don't think the sales team I mean, the 100 is great.

56:32 We're focused on that 13,000 positions that we have out there. There's a lot more that we can and expect to do, and, yeah, we're starting to see some really positive signs, you know, underneath that. So, love, love, love the team. The area that, you know, would love to do more of is on the marketing side, right, just to provide that, you know, air support that I call air support for our kinda troops on the ground for lack of an expression. Just there's a lot more we can do on the marketing side, that I would love to be able to to accomplish here as we go forward. Just continue to drive that awareness, provide better support, you know, expand beyond that twelve to thirteen thousand. We've not this we're kinda dipping our toe in it a little bit here as we kinda, you know, manage all the moving parts of our business, but if there's an area that I would like to do a lot more of, it would probably be more on there, and then eventually if it warrants it at more than Salesforce in in in due time.

57:25 Perfect. Greg, I might just jump in there. I think you've we're coming up to the hour now, you have answered a lot of questions today. Thanks to to Wolbrook for sharing the q and a as well. But just before redirecting investors provide you with their feedback, which I know is particularly important to the company, Greg, could I just ask you maybe for a few closing comments? Yeah. Absolutely. First off, thank you for your time today. Thank you for all the questions that came in. Hopefully, we got a chance to address, I think, the the vast majority of those, as well. So really appreciate, folks' time, your interest, and the, questions you submitted here as well. We also appreciate you coming on this journey with us. Right? Again, I go back to where I started where we have a firm line of sight to our mission, which is to change the way these patients have been treated for decades for iron deficiency without anemia. We've got a great asset. We got a lot of, physicians out there that are looking for an asset like ours. We need to kinda connect those dots together to make this a success.

58:21 We're very, very encouraged by, again, some of the underlying things we see during the first quarter here that, you know, did just get dampened, unfortunately, by Texas. Texas. So we gotta deal with that, but we are encouraged by some of the underlying signals that we're seeing here that we talked about here as well today. And long term, look. Our goal is to make this product a success, get to be the oral line of choice. We got a great partner in The US of Beatrice, very exciting ex US progression as well. And if we execute on those, which we tend to do, the shareholder value will come as well. So we appreciate everybody's, you know, work with us, their patience. They're joining us on this mission, and, we're excited about the work that we are doing on a day to day basis. Perfect. Greg, Santosh, thank you once again for updating investors today. Could I please ask investors not to close this session? Should now be automatically redirected to provide your feedback in order that the management team can better understand your views and expectations.

59:16 This will only take a few moments to complete, but I'm sure it be greatly valued by the company. On behalf of the management team of SHIELD THERAPEUTICS PLC, we'd like to thank you all for attending today's presentation, and good afternoon. Thank you. Thank you.