Shield Therapeutics (LSE:STX) — Interim results

0:00 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 could be submitted at any time via the q and a tab situated on the right hand corner of your screen. Simply type in your questions and press send. The company may not be in a position to answer every question it receives during the meeting itself. However, the company can review all questions submitted today and publish responses where it's 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 the management team from SHIELD THERAPEUTICS PLC. Anders, good afternoon, sir.

0:33 Thank you so much. Thank you so much, and, a warm welcome to all of you to our presentation of the first half twenty twenty four interim financials. So my name is, Anders Dunstrom. I'm the interim CEO since end of July of this year. By way of background, I've been in this pharmaceutical industry for over thirty five years, half of the time in Europe and the last eighteen years here in The US. Important to note is that I've been on the board for SHIELD THERAPEUTICS for over three and a half years, so since the setup of the commercial operations here in The US and our initiation of the collaboration with Viatris about, you know, five quarters ago. My role on the board is to be the commercialization expert. Although, this also have been the c's CEO for a public trading company before. With me today is Santosh Schambag, our CFO, and I will let Santosh introduce himself.

1:22 Thank you, Andres. Hello, everyone. As you as you as Andy said, my name is Santoshanbag. I'm the CFO. I've been with the company since the start of the year, and I'm excited about the growth that we're seeing today as well as potential growth in the future.

1:36 Been in the in the industry for about a couple of decades right now prior to coming into SHIELD. I was the CFO of a public company here in The US. We took them public here. We were a leading digital therapeutic company. And prior to that, I spent about a decade at Vertex Pharmaceuticals, both here in The US, leading their finance teams as well as the CFO of the international business, out of Europe, based out of UK, responsible for Europe, Australia, Latin America. Looking forward to this discussion today. Thank you, Santos. Here are the here's the disclaimer. So now when everybody read that, let's just move into today's presentation. So today's presentation is divided in two parts before we come to your questions. So I will start by presenting, the opportunity in the iron deficiency with or without anemia market, and Satosh will follow-up with our first half financials.

2:30 And then as I said, then we will take, your presubmitted questions.

2:38 Oh, sorry. Sorry. No. My bad, guys. Sorry. No. I'm too quick. So let me then just introduce you to SHIELD THERAPEUTICS. So SHIELD, we operate, as I said, in the iron deficiency market. It's a very big market, and I'll come back and show you some numbers so you can get the feel for the size of the market here in The US. Our reason for being is that most traditional oral iron salts often leads to discontinuation because they irritate your stomach. You do get, actually, problem and and stomach side effects, and thereby they stop taking the therapy and also leading to insufficient efficacy. So Acrofir as the brand name here is here in The US or Feracru as it is ex years in in Europe, is the only well, it's FDA approved. It's approved in Europe, and now by Health Canada has a very broad indication for use in adults suffering from iron deficiency with or without anemia.

3:38 We are lucky to have a very experienced executive team with extensive US commercialization expertise, but also extensive expertise because of manufacturing, regulatory, r and d, and so forth. And I I have a slide describing that for you as well. As I said, we are co commercializing in The US with Viatris, and that has really catalyzed our commercial expansion and and growth for Aquifer in The US. And we're lucky to have such a established company as our partner when we are on the journey and in here in the on The US market. We estimate the peak revenue potential of AgriFare to be around $450,000,000, and I'll show you some numbers later on, you know, in the presentation so you see how we come to such such a large number. And very importantly, we have very strong intellectual properties through 2035.

4:35 So this is the management team where so so Santoshana, myself, Lucy, and Andy are are stationed here in The US, and and David and and Jackie are in our Newcastle office. So we we spread across both countries, and then we we cover different things as you see. And we're very as I said, we're very fortunate to have such a strong experience and capable management team to to lead our efforts. And as we are a small company, many of us wear wear many different hats. So iron deficiency is it's it's a very common and and can be serious condition. It's and that has a significant impact on on patient's quality of life. So as you can see, symptoms can be that you feel very tired, you have headache, you're dizzy, and can you can even suffer from cognitive impairment.

5:30 It's most common in in women of childbearing age, and also in patients with inflammatory conditions such as Crohn's disease or ulcerative colitis. And it could be caused, as you can see on the slide, by malnutrition, malabsorption, or bleeding. To describe the problem for you a little bit is that that most oral iron salts, as I said initially, they they dissociate, in the stomach, and that leads to that they irritate the the stomach lining, and that is where the gastrointestinal sort of side effects appear. What happens then is that a quite large portion of the patient patients cannot tolerate this, and they stop therapy.

6:23 So, of course, if they stop therapy, the therapy wouldn't do what it's supposed to do. So so that is where we come into play. So our solution is a very elegant solution on how to avoid these gastrointestinal side effects by having the actual iron protected by a maltor shield so it can pass through the stomach and be released and absorbed in the small intestine instead. That gives us a very nice place segment in the market. So many of these patients have tried and or or, you know, tried other oral iron salts before either of you know, typically many are available as OTC products.

7:09 And and and since they don't work, they try them again, and they don't work. They try them again. And before everything get it can get very serious, and then you would need an an IV infusion. But we are sort of smack in the middle there. And and as I said, our our reason to be is that our

7:44 describe The US market opportunity for you. But let's let's before we get there, let me let me share with you where where do we, have our global partnerships and, how do we continue to progress. I'd come back to Viatris, and I mentioned it already. We have since a year a 100% Salesforce here in The US. And and what we do here, here we have a revenue sharing agreement, and we also have some milestone at at some, at revenue levels that we, can collect in in the future as well. So that's The US market, and I'll come back to that more in a little bit. In Europe, we have Nourgene as our partner. And as you will see soon from the number, they continue to do well. They've done really well the first half of this year.

8:33 Here, get royalties, and and we have a milestone payment up on the approval of the pediatric label in Europe as well. In Canada, we have Kai Pharmaceuticals. They just got approved, which we're really, really happy about. And Canada is a significant market. I I used to say that if Canada compared to US is, of course, very small. But if you compare Canada to the top markets in US in Europe, I mean, sorry, it would typically be ranked six or seven. So it is a significant market opportunity. Here again, we have revenue revenue based milestones and payments, and, milestone payments and double digit royalties on net sales. In Korea, we filed an application. We know it's being reviewed.

9:18 And if everything goes well, which we, of course, hope it will do, we anticipate an approval next year in 2025. Same setup here. We have royalties in the mid teens on on net sales. And then in China, finally, we have a phase three study ongoing. We hope the study concludes late this year or very, very early next year. We can file we can file then in 2025 and and expect an approval in the second half of twenty twenty six. Again, the same setup with a Chinese partner. We have approval milestones. We have double digit royalties on on net sales. And now then to the to The US. So, we are co commercializing in The US with Viatris, and and ask to give you a sense of the size of the market here. So there are estimates about twenty million individuals have iron deficiency.

10:14 It's a large and well defined market, and and we see about twelve million prescriptions per year. And the great majority of these prescriptions are then prescribed by either, ELL practitioner or by OBGYN specialists. So at this moment in time, we are in the dark blue circle we call current. So we call on about 12,500 HCPs, and they represent about 1,800,000 prescriptions. So as you can see there, we have about 3% market share in that market segment. So there's a lot more we can achieve already where we are sort of focusing right now.

11:06 What we call the expanded market is the market where we seek that we could go into in the future. This is you can see that half of the addressable market are in the expanded market with 6,000,000 yearly prescription out of the 12,000,000 in total. And this segment has about 50,000 HCPs, and that is something we could reach when we expand the business further the future. And this is the rationale and background how we can get to our sales potential, is around 450,000,000 a year. So by that, let us continue with the first half year financials with Santos. Thank you, Anders. I'll I'll I'll I'll go through the details of the press release from this morning. As you can see on this slide, we have got three key big priorities. The first one, obviously, is growing AcreFer here in The US on all three fronts, revenues, prescriptions, and gross to net, making sure that we have a strong balance sheet and back financially to support our near term and long growth. And then, obviously, making sure that is available to patients across the globe, especially through the partnerships that we have in different geographies.

12:18 On the very first bubble there, the growth in AccraFit, we reported this morning 11,000,000 aquifer net revenues in the first half of this year. Now that represents about a three and a half times growth compared to the first half of last year. Obviously, aquifer is the growth in revenues is driven by two elements, the demand as well as the pricing. On the demand side, we we reported 65,200 prescriptions for the first half. Now that represents about a 25% quarterly growth

12:48 since the launch of the product with the with Beatrice earlier last year, the first half of last year where we had a 100 reps in the field. On the pricing side, we reported first half of a $158 net price realized per prescription. Now that's a 33% growth versus the first half of last year, and that continues to grow steadily on a quarterly basis. As an example, there you can see, in q two of twenty four, it was a $171, compared to the 158 that you saw, for the full first half. From a balance sheet perspective, we exited the quarter, q two, with 8,100,000 cash and cash equivalent on hand. We have implemented an accounts receivable financing that's already in place.

13:35 That was implemented in April. And then since the close of the quarter or the close of the half, we added another 5,700,000 in cash that we got from the monetization of the Chinese milestone. This was done with our largest shareholder, AOP. This was done in

13:52 q three twenty twenty four. So to be clear, the 5,700,000 is not included in the 8,100,000 that we reported in cash. And on the on last but not least, from a global perspective, as as Anders mentioned, CHI Pharmaceuticals received the Health Canada approval in August. So we just reported on that recently. We are excited about that. Earlier this year, KP Pharma, our partner in Korea, filed a new drug application in Korea.

14:19 Pending successful review, we expect an approval of that in 2025. And we are also anticipating the data from our pediatric study later in 2024. We are expecting that pretty soon, actually.

14:35 Digging a little deeper into the details of the financials. From a revenues perspective, we reported 12,100,000 for the first half of this year. As I mentioned earlier, 11,000,000 of the 12.1 was from Acrefer, and you can see on the slide the two key drivers there, prescription and pricing. The remaining 1,100,000 was revenues driven primarily from our global partners. These are for product sales in Europe, and these are royalties that we receive on those product sales. The 1.1 compares to 600,000 that we saw in the first half of last year. So we are excited about the growth both in aquifer as well as ex US revenues. Operating loss, we reported 15,500,000 in operating loss. The components of those loss are you can see gross profit increased to 5,500,000 compared to 1,700,000 in the first half of last year. The growth in profit was driven primarily by the increase in AgriFER revenues.

15:35 Selling, general, and administrative expenses was 18,800,000 compared to 17.1 in the first half of last year. The increase was primarily driven by the US sales force expansion, obviously, the launch and scale of AgriFER. R and d was 800,000 for the first half of this year compared to 400,000 for the first half of last year. From a balance sheet and cash perspective, cash and cash equivalents, like I said, was 8,100,000. The year end number competitively was 13,900,000. So you can see we are looking to manage our burn on a quarterly basis over here. We have added a $10,000,000 accounts receivable financing with Sally Port. That was basically a receivable of that can fund the $10,000,000 line of credit that we have with them.

16:21 This was put in place in on 04/30/2024. In the first half, we also amended the $20,000,000 debt facility that we have with SWP. This was amended to make the terms more favorable, the covenant terms more favorable towards the towards the company. And then, like I said, post period, we also added the 5,700,000 monetization of the Chinese milestone with AOB held, one of our large one of our largest shareholders. Here, double clicking a little bit further into the prescriptions on a quarterly basis, you can see we have a a good q two twenty twenty four with 36,400 prescriptions. This is a 26% growth over q one, so we like the fact that we have rebound there from q one.

17:07 Obviously, this is a testament to the SHIELD and the interest field sales teams that have done a great job in trying to bring this back back on track. Our average quarterly growth right now, like I said, is about 25% following the field sales expansion with VHS in q two twenty twenty three. And the growth has come primarily driven in three in in the large states such as California, Florida, New York, and Texas. Obviously, this translates then into revenues and pricing. You can see on the left hand side 69% quarter over quarter growth in revenues. So q two twenty twenty four was 6,900,000 in aquifer revenues. This excludes the global revenues from a global perspective. And then on the right hand side, you can see the pricing.

17:54 It continues to remain, you know, a bit volatile, but it's going in the right direction. You can see a $171 per net realized price per prescription, which is a 23% growth quarter over quarter. And then last but not least, we talked about the 8,100,000. Wanted to make sure that everyone had a view into the different components of how we are strengthening our balance sheet. We have a $20,000,000 term loan with SWK. You can see the details on the slide. We added another $10,000,000 of account receivable factoring. You can see the details on the slide. This was done, as I said, in April. Think of it as a line of credit that we can use the active for receivables to fund that line. And and last but not least, the AOP

18:39 health deal that we just announced, which is the $5,700,000 milestone monetization that we added after the close of the period. So with that, I'll hand it back to Anders.

18:58 To take the questions. And, Santosh, thank you very much for your presentation this afternoon. Ladies and gentlemen, please do continue to submit your questions just by using the q and a tab situated on the top right hand corner of your screen. Just while the company take a few moments to review 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. Guys, as you can see, we have received a number questions. And, Alice, at this point, if I could hand over to you to share the q and a with the team, and I'll pick up from you at the end. Great. Thanks very much, Lily. So we'll start working through the presubmitted questions first. So first question is when do you aim to break even? Yeah. Maybe I can take that. What we have said what we have said in the past is we we're looking at the growth of Acrefer, and based on our internal assumptions and based on the internal forecast, we do expect to breakeven in the second half of twenty twenty five. And what I mean by that is we expect to be cash flow positive in the second half of twenty twenty six.

20:01 Thanks, Santosh. And second question, does management have any internal forecast or expectations for three to five year forward revenues?

20:10 What plans do you have for additional products and time frame?

20:14 And as I can maybe take the first half and then forecast. Yeah. Yeah. We obviously have our internal forecast and expectations. We manage ourselves and the board manages us through those forecast and expectations. We have not made that public, and we have not provided guidance on in terms of near term forecast. What we have said, though, is we do look at this as a peak revenue opportunity of $450,000,000, and we we stand focused on trying to get there as quickly as we can.

20:43 And on additional products, so I think it's it's worth reminding everybody. We're one year into the launch with here in The US where we together with the others have a hundred hundred people's Salesforce. So, yes, we would, at the at the right time, add add another product. I mean, it is also worth mentioning that that we're only scraping the surface of the potential of this market where we, you know, we are active in right now. The right product that would fit into our core targets, which would be primary care physicians or general practitioners or with OBGYNs, yeah, that would be, of course, be be be something we would be interested in in adding at the right time. But as Santo said already, you know, a couple of times, what we're focusing on right now is the aquifer in the iron deficiency market.

21:36 Thank you. Next question is, why did none of the directors buy shares, especially when the share price was quite low? So first of all, mean, none of us can really comment on what each director, how they invest their their their their money. So that's that's number one. Number two is that we've been we've been in the in the closed period for for quite some time. That period ends today, so that that that's where we are at.

22:07 Thank you. What progress is being made in The UK? Is Aquifer available on the NHS?

22:19 I mean, Norgene is our partner in in Europe and also in in UK. I they we've had some struggles with reimbursement in The UK. I know they are working hard to sort of improve the situation. The label we have in in Europe is the same label we have have in The US. So it's it's really up to them to make that comment what, you know, what efforts they are, you know, deploying in The UK to get to improve the situation. But we we we are in constant

22:51 talks to them, and we will every year, we have an approved plan that that that then they they later execute on. So that's that's what I can and, Santosh, anything to add there? No. I think I think you covered it. Okay. Yeah. Thank you. Please, can you state the exact reason for Greg Madison's departure from the CEO? Was this influenced by institutional shareholders? And I'll also follow that up with a second part from another question, which is,

23:18 where are you in the process of hiring a full time CEO, or what's the trajectory for that? Mhmm. So when it comes to, Greg Nelson's departure, also mutual decision between himself and the board. That's what we that's that is the what we stated, and and that's our comment on on that.

23:40 The search for a new CEO, no. We have not initiated any research as of yet, so I'll be here, until we do that. Great. You've previously mentioned challenges in Texas, and the q two statement mentioned a rebound. Today, Texas is quoted as one of the large states behind the growth. Can you tell us a bit more about profile of recovery in Texas and how trading is there now? Do you want me to take that, Anders? And then Yeah. Yeah. Yeah. Let me start by saying, so what happened in Texas early and you can come into the what happened in Texas early this year is actually that the plan that paid for Medicaid prescriptions, the the the so that they provided, you could say, actually went away. So that that's what happened, which is kind of sounds like an odd thing if especially, if we have a European perspective that all of a sudden your product is not available any longer if you have the certain plan.

24:32 So that is really what happened. It is odd. It's back again. It's back since April of

24:37 this year, and that's why we see a rebound in the you know, why we can see a rebound in the second quarter. But that disrupted for us and for the patients the availability of Aquifer to to medicate, patients. Thank you. Now there's a little water under the bridge in regards to the third party data provision. How is your conviction in the prescription data evolved? Are you back to full conviction in it?

25:04 Yes. Yes. Yes. We are. Yeah. It it was another yes. No. No. That was last year where one of the providers that then sort of did not provide the data to IQVIA first and then did provide the data to IQVIA, so it was double reporting for a while. That's all over. I mean, that that's happened in the third and fourth quarter of of last year. So the the data we have today is is very solid, and there's no doubt that what you see is what it is. Great. Is it possible to extend the patent, and what would you need to do for this? Well, one thing that is happening actually is when we get the pediatric approval in Europe, for instance, and as Santos mentioned, we we, hope to see the study concluded, you know, before the end of this year is what we will get the six month patent extension in in Europe.

26:12 We're constantly sort of reviewing intellectual property because that's the most important thing you have protecting your product, of course. Now we have a very we I mean, our IP doesn't expire till 2035. So but we would, you know, have a you know, not every day, but a yearly review to see what could potentially be done to further strengthen the the our intellectual property. Thank you. When talking about net selling price, does the average drift up gradually over time, or is it stepwise on the back of targeted discussions with formulary networks and payers, And if the latter, how much scope is there to continue driving this with existing customers given the improvements already achieved?

27:02 Do you wanna take with the start centers? Or Sure. Sure. Sure. I can start with I can start with that. So Yeah. Sure. Obviously, it's a concerted effort to make sure that we continue to increase that net selling price. The it it is it is not it's not a very straightforward pricing model here in The United States. There are different payers, and you have to negotiate with each one of them to ensure that the patients get access, and then the and then the insurance companies cover those patients. So we we work with each one of them on a on a regular basis and try and maximize as much coverage as we can. So it's really a it's really a function of how much coverage we can achieve as of and how fast we can do that. Over the last twelve twelve months since our partnership with Beatrice really began, we have had good success and good progress on those on that front, which is why you have started to see that the pricing is steadily increasing.

27:59 So I I think we should expect to continue to see that. In areas where insurance does not cover or or there are certain plans that do not cover the patient, SHIELD tries to help those patients by providing that medication, at a at a subsidy or, in some cases, free. And as that as that coverage continues to improve, we can start to see that by the work that is being done by both the Viatris team as well as SHIELD, you should expect to see that that price goes up. So that is really the without getting into the excruciating detail, that's at a high level how I would describe the pricing. And so we should expect to see that price go up as time progresses. Anything to add there, Anders? No. No. I think it it it that is very well said. I mean, the system is complicated. You know, as you said, Santos, and it's really people have have different insurances and different level of coverage, but it is something we can actively work on on on our side as well.

28:57 We can influence this. And that also that is what we have been doing, we are doing, and we will continue to do to the large extent ever possible. I there were all there will always be a portion that we would give away for free or give away heavily heavily subsidized. It's just the nature of the market here. Unfortunately, everybody does not have good coverage. But, typically, at the provider at at the physician's office, they they see people from all walks of life. So that is that is what you do as a pharmaceutical company in The US market. Thank you. Please, could you explain the delay in the pediatric study? Yeah. I mean, I I would say I you you should expect to see the data from the pediatric study soon. I think we just leave it at that.

29:49 Okay. Who are your main rivals in the iron deficiency market? Yeah. It's a good good question. It here in The US, it it would be any oral iron you can go to the pharmacy and buy. So the there's there's we we're unique in the sense with the label we have and and the approval we have. But as you probably are aware, there are oral iron salts that you can just go by without a prescription in the market. So that that is, I mean, that is what will be our biggest competitor at at the moment. Thank you. Is the strategy stretched too much and should focus remain on building The US market share rather than trying to expand into other markets?

30:38 Oh, so we really only focus on The US market from our you know, with our own on our own, having our own people. Every other market we are either are in or plan to be in, we do with partners. And, typically, when you have a partner doing it, then we can use Canada as a latest example or kind pharmaceuticals. They will do all the heavy lifting. They will do the investment in the local market. We provide guidance. We provide product, and we, of course, help them to get through the regulatory process and potentially a reimbursement process, but that is where it stops. So even if we were to expand into even more markets or when Korea or China becomes approved, it typically doesn't require many more resources on our side. So so our resources are focused on The US market.

31:41 Most everything of of the resources, people, money, whatever it is is focused on The US market. So we wouldn't we we are not, and we would not be that thin even if we continue to expand our geographical footprint. Thank you, Anders. We've had several questions along along the lines of this, but will there be any need for further cash from shareholders prior to breaking even? Yeah. I mean, I think maybe I can take that, Anders. Yep. As you've seen, we we we constantly are looking to strengthen our balance sheet, and and you've seen we have continued to do that. We do that by managing our expenses. We do that by managing our working capital, and we and accessing new capital. So having said that, you know, do we need more money?

32:30 If there is an opportunity to bring in additional capital into the company so that we can further invest in growing and scaling AcreFit, I think that would be a I would we would evaluate each of those opportunities on the benefit of the terms and and make sure that we can bring in the right money at the right value. So that's probably what we would wanna say on that. Anything to add there, Anders? No. I would agree with you to a 100%. Yep. Thank you, Santosh. Could you talk about churn and repeat orders? Sorry. Say that question again? Could you could you talk about repeat orders? Or you mean refills? Repeat prescriptions. Prescriptions. Yeah. I mean, what the way we do this so if every salesperson has, you know, roughly a 125 targets each, of those, what we do, we focus in on on, like, the top 25 or top top 30 physicians they have in each territory, and and those would typically be your largest prescribers.

33:41 So, yes, we we see a good amount of people prescribing again and again and again and again like you would like it to be. Very few are one offs. Right? So that is why we focus our effort. I don't have a number here to say, oh, you know, our average physician prescribed x amount of prescriptions per month per year or something like that. But our absolute focus is on those, health care professionals that prescribe has the most amount of patients. So that that is how we we run run our operations here. Thank you, Anders. Revenues from Norgeein seem to have grown solidly in h '1. Are they doing anything different, and do you think this will continue?

34:32 NordGen has done a good job in this in the first half of this year compared to last year. There are several different contributors to that, but at the at the highest level, I would say Germany seems to be doing doing well for them. They are expanding their focus areas, you know, into women's health in in Germany as well. And I'm sure the reimbursement landscape there is is slowly improving. So I think those would be the top drivers from our perspective. There are a lot more intricacies probably not worth getting into the call right now. Yeah. Thanks, Santosh. Given the degree of discounting and discounts that insurance companies require, should we model a higher price of net at, say, $200 or higher? I know today it's at $17.01.

35:22 Yeah. I think what we have guided previously, and we still believe in that, is we we do think that this can get north of 200. I think we may have said $2.20 is the is the number that we may be able to target. We see we definitely see lots of levers in the model right now that we can use and and hold to get get to that number. So $202.20 is a is a reasonable assumption to have over the next eight, twelve, eighteen months, I would say. Great. And just following on from that, could you talk about insurance coverage? Which states do not have coverage at the moment and why? Oh, yeah. It's a it's okay. Fine. The commercial side, we have about 60% of everybody covered. Right? On the Medicare side, we have zero, basically, coverage. And on the Medicaid side, we have very good coverage across all 50 states. So it depends on where the the patient is really where they are insured to sort of give you a full answer. It becomes a bit complicated, actually. I I don't have each channel, the percentage of each channel, and and so forth.

36:38 But what I can tell you is that a salesperson, they have that data available for them when they go see a provider or providers. They can see what the type what the mix of patients are, who's covered, who isn't covered, and so forth. So that is part of how you operationalize your territories, and and so forth. So and and the the the challenge is, of course, you cannot own oh, yeah. Only gonna go after patients are covered because in for one physician, they have a whole mix, bag of different, patients with different type of insurances. So if you, for instance, have Medicare where we, charge a cash price or or they can buy the product from us with because they don't have coverage, you cannot say, oh, he's gonna walk away.

37:32 You still have to be able to provide them with some type of help to get on the product. Because as I said, that that prescriber have all types of commercial Medicaid Medicare patients. So that that's why it it we I would need several slides to sort of answer that questions in a very precise way. Thanks, Anders. Yeah. Santosh, probably one for you. The corporate presentation outlines minimum revenue targets for the term loan. Are there every new targets cumulative? Yeah. So the the revenue targets are are a rolling twelve month revenue target. So every month that goes by, you you look at the last twelve months, and that's the rolling target that you're looking at. So it's cumulative from that perspective. Yes. Yeah.

38:21 Thank you. And then I think this is probably the last one unless we have some more come through. I think I saw in the performance slide increased sales and margins, but in the same period, a significantly increased operational loss. If that was correct, please, could you explain? Yeah. So you you can see that our gross margins increased on Acrefour, and that's primarily driven by the fact that Acrefour is growing. So gross margins for on the product continues to increase because of the revenue growth. We did see an increase in operating expenses same as a period over period. So first half twenty four versus first half twenty three. And that and that was driven primarily due by the fact that we have a full Salesforce right now. So keep in mind, we launched our Salesforce in in q two of last year. So the 100 people that are in our Salesforce came in really in the second part of the of last year in the first half of last year versus in the first half of this year, we had the full Salesforce for the entire six months. So there's a there's a driver there as well.

39:28 There are additional summary items that get added into the g and a, so the expenses related to the financings also get added within the general and administrative expenses. You should also expect to see that, you know, as we as we wrap down our pediatric trial, those costs will start to to go down as we see into the second half of this. Fantastic. And just following on from that, what would you what would need to happen to the size of the US Salesforce in order to address the expanded market size as opposed to just the current market size? Oh, well, we need to we would need a a larger Salesforce to do that, and that would probably the way we the way we view that, it would happen in increments. You wouldn't jump from covering 12,500 HCPs to 50,000 status. Like, it's a four four x jump, which which would technically mean you would have, like, a 400 person Salesforce.

40:24 We would do that in increments. But that that is sort of the plan how we would grow Acrefer in The US. Yeah. Maybe I can add that too, Anders. I I think if you if you take a step back, you you you can think about the go to market in in in really two large buckets. There's the feet on the ground, which is a Salesforce, which is a fixed cost that, you know, companies can incur, or it could be marketing spend that you that you, you know, opportunistically take an advantage of certain times of the year and spend a little bit more in marketing, which is a little bit more variable, and we can control that cost on an ongoing basis. So to address that expanded market, you know, we don't have to put all of our chips in one basket, which would be the Salesforce expansion. We could leverage some of those investments in marketing. And so it's kind of a mixed mixed resource allocation and or capital allocation.

41:15 But to Anders' point, you know, if we really wanna go after the full 6,000,000 prescriptions of 50,000 physicians, you you would have to expand the Salesforce. But that would that would be massive, and we wouldn't wanna do that. It it it would be a it it would be a well thought through expansion into that space. Yeah. Yeah. Perfect. And then I've just actually had another follow-up to that question. Can you give us an idea of how an individual salesperson drives sales over time? I assume there's a settling in period, but a sales continuing to grow with the most long standing salespeople. It it does. And it's a matter of how breadth and and depth. Right? So how many do you call them? And then as I explained before, you typically have your, you know, your your whatever number of top prescribers you have in your territory, you work on those who have the largest accounts.

42:11 So that that's what you do, and you can see that, which we which we look at, for instance. So what does it look like from time point zero and and you move ahead into three or twelve months ahead? What what does that look like in that territory? What targets would they need to reach and so forth? And and it is something we measure very, very closely because we would expect to see growth. And and then as and then we would expect now to continue to see that grow growing as well since we we have only penetrated 3% into our our current market. But that is how we go about that, and it's measured very, very closely because we have very good data that that we can follow the the penetration into a territory because when it comes to breadth and depth in in calling on your targets.

43:08 Thank you. And then just one last question. How do you intend to improve shareholder value? Yeah. I mean, that that is what I think what we've seen now over the last I think, again, I think what what in the the perspective, sometimes we forget it ourselves, but we've only really been active for four quarters with the full strength here in The US, which is really the biggest driver of our revenues. Of course, other markets will help out as well, but US is the key market. And by continue to execute according to the plan we have in place, that is the gonna be the biggest driver for shareholder value going forward. Anything else, Santos, you wanna add to that?

43:53 No. I think you said it perfectly. I I I think we are as a company, we are focused on operational execution and growing Acrefer and and growth in Acrefer and the and the whether it's revenues, prescription, or pricing. That's that's what we are focused on, and we are seeing that happen over the last twelve months. We have seen that happen. We expect that that to happen going forward, and that should hopefully translate into shareholder value as we see in the future. Yeah. Thank you, Anders. Thank you, Santosh. Lily, I'll hand back to you now. Anders, Santosh, thank you for answering all those questions you from investors. And, of course, the company can review all questions submitted today, and we'll publish those responses on the investor meet company platform. Just before redirecting investors to provide you with their feedback, which I know is particularly important to the company, Anders, could I please just ask you for a few closing comments?

44:42 Yeah. Yeah. First of all, thank you for all the listen, and thank you for all your very mindful questions. We've had a great first half of of of this year. We're very excited to see the strong quarterly over quarter growth over the last four quarters, And this growth growth is seen since we launched our co commercialization effort with Viagra. So that that is what so to some truth, but that is what we focused on, continue to be very efficient with our commercial operations here in The US. And, Santosh, thanks for updating investors today. Can I please ask investors not to close this session as you'll now be automatically redirected to provide your feedback in order that the management team could better understand your views and expectations? This will only take a few moments to complete, and I'm sure will be greatly valued by the company. On behalf of the management team of SHIELD THERAPEUTICS PLC, we'd like to thank you for attending today's presentation, and good afternoon to you all.

45:38 Thank you all.