Ascelia Pharma (Stockholm:ACE) Q2 2026 Earnings Call

0:00 Welcome to Ascelia Pharma Q2 twenty twenty six Report Presentation. For the first part of the conference, participants will be in listen only mode. During the questions and answer session, participants are able to ask questions by dialing pound key

0:16 Now I will hand the conference over to CEO, Magnus Korfetzen CFO, Anton Hansen and CSO, Andreas Norlin. Please go ahead. Thank you, and welcome everyone to the webcast for Ascelia Pharma's Q2 report for 2027. On this call, we will be making forward looking statements. On today's call, will start with an overview of Ascelia Pharma and recent key events, and then head into our portfolio update with an emphasis on the recent complete response letter for Orbiglans before moving to financials and priorities ahead. After the presentation, we will open up for questions. At Ascelia Pharma, we identify, develop, commercialize novel drugs that address unmet medical needs within rare cancer conditions.

1:03 We're based in Malmo in Sweden, and we're listed on nastax.com. We have two drugs in our pipeline. OrbiGlance is a diagnostic not diagnostic drug, and we have submitted a new drug application to the FDA to obtain approval in The US. We received a complete response letter in early July, and we'll meet with the FDA on September 9 to find the the path to approval. Oncoral is a patented tablet formulation of ibenzotikin with encouraging results in phase one and potential to treat a range of solid tumors. In April, we raised 20,000,000 Swedish krona in a directed share issue, and in May, we had our annual general meeting as usual. In June, all the cleanse data was presented at the ESCA conference, the major European conference for gastrointestinal and abdominal radiology.

1:57 At the end of the quarter, we filed a patent application regarding packaging and manufacturing and thus further strengthened the IP position of Overglance. After the end of the second quarter, we received a complete response letter from the FDA regarding our new drug application submission for Orbitlance. This was unexpected and we'll talk more about it later on this call. We also announced that our Chief Financial Officer, Anton Hansen, will be leaving Ascelia Pharma and that we have implemented cost reduction actions to improve our financial flexibility. I'd like to thank Anton for his contributions at Ascelia and wish him best of luck going forward. We will start the portfolio section of our presentation with Despite the setback with the complete response letter, we continue to be excited by Orbiglance and here is why.

2:52 Orbiglance is addressing a well defined unmet medical need for a subgroup of people living with cancer. This is an 800,000,000 global addressable market opportunity with Orbiglans as a first in class product to target this, and the product has orphan drug designation from the FDA. We have not we have commercial scale manufacturing in place, and we have strong data from nine clinical studies, including compelling phase three data. As mentioned, the the Orbitlance new drug application has been submitted to the FDA and undergone the review process. Unfortunately, FDA sent a complete response letter with some specific issues, but many areas of the new drug application were reviewed that didn't result in issues being

3:33 raised. Our focus is on agreeing with the FDA on what is required to obtain approval for Organize. Organize is an attractive asset, and we will work with our partner who will drive the commercialization once the product is approved. Based on the NDA submission and the data, the unmet medical need that Orbitrans addresses, the, progress of the review process including the audits conducted, we were expecting an approval of Orbitrans in July. In the complete response letter, the FDA raised some issues that we will discuss with them at the type a meeting in September and aligned so we can find an efficient way path forward, for Orbiglans. We continue to be confident that the OrbeGlass new drug application is supported by substantial evidence of efficacy and safety for its intended patient population, which we think should support approval and are committed to bringing OrbeGlass to patients.

4:28 We'll now go into more details on the regulatory process and I'd like to hand over to Andreas. Thank you, Magnus. Yeah, as Magnus just mentioned, receiving the complete response letter was not the outcome we expected given the interactions we had with FDA throughout the development and the review process. The questions in the response letter relate primarily to aspects of the image read methodology including the justification of the reread and interpretation of the results together with comments on the product quality. Importantly, this gives us a focused set of issues to work through rather than a broad challenge to the overall program. Our team has moved quickly to analyze the FDA feedback and evaluate the most appropriate path forward, which we have outlined in the Type A meeting briefing package submitted to the FDA.

5:20 And we continue to believe strongly in the clinical value of the product and are fully committed to addressing the agency's questions in a collaborative manner.

5:32 So let me now briefly explain how we view these topics. First, I want to acknowledge that the FDA's conclusion differs from our own assessment of the data. The agency has requested additional clinical evidence and we take that conclusion very seriously. At the same time, after extensive internal review and consultation with external experts, we continue to believe that there is a strong scientific rationale supporting the decisions that were made in the NDA application originally. Specifically, we believe that image reread was justified by systematic bias of the image scoring that was identified. We also believe that the training of the new readers was appropriate and that assessment of t one weighted images represents a clinically relevant measure of efficacy for a t one enhancing contrast agent such as OragLance.

6:26 The discussion around t one can sound highly technical, but the principle is actually quite simple. Liver MRI relies on multiple imaging sequences, each contributing different and complementary information.

6:40 T one is the sequence where Orabounce is designed to work. T two and diffusion weighted imaging remain important parts of the examination, but they provide different types of diagnostic information. So based on this, we believe there is a strong scientific rationale for evaluating lesion visualization using t one weighted images when assessing the effect of a t one enhancing contrast agent. At the same time, we recognize that the FDA has taken a different view and we remain committed to maintaining an open and constructive dialogue with the agency as we work toward the most appropriate path forward. Regarding product quality, we have aligned with the FDA's recommendations and implemented the requested actions related to product specifications.

7:31 So let me conclude by putting this into perspective. The FDA inspections carried out during the review were completed without critical findings for the NDA and the product quality observations have been addressed in alignment with the agency's recommendations. This is highly reassuring and for the continued dialogue with FDA. The remaining discussion is centered on the interpretation of the clinical imaging data and the upcoming Type A meeting provides an important opportunity to align with FDA on the path forward.

8:03 While we are disappointed by the outcome of the review, our confidence in OrbeGlans remains unchanged and we continue to believe that the totality of the imaging efficacy and safety data supports approval and we remain fully committed to bringing Orbiglance to patients. So Magnus? Yeah. Thank you, Andreas. So I'd like to to run off the Origlance part of the presentation, with some important milestones ahead. As just described, we have the Type A meeting with the FDA on September 9, and minutes from this meeting will be available no later than thirty days after the meeting. We will provide an update once we get the minutes. Commercial opportunity for Overglance is attractive with a global addressable opportunity of $800,000,000 and almost half of that in The US.

8:51 We have market exclusivity through the orphan drug designation and has expanded the IP position through several patent filings. The potential partners for Orbiglance have confirmed continued interest in Orbiglance after they received of of the complete response letter, and getting clarity on the path ahead is important for getting the partnership agreement in place. The complete response letter was unexpected. We think the Overglance data package should support approval and are committed to working with the FDA to obtain approval as well as securing a partnership with a larger company to drive commercialization and ensure patients with who will benefit from OrbeGlass.

9:32 Now we move to Oncrol. And please go ahead, Andreas. Yes. Thank you again. So while our primary focus right now is of course on securing a successful approval and partnering for Oragans, we also have Oncrol in our portfolio. And that program remains an important asset and we're looking forward to reinitiation when the timing is right. But let's just spend a few minutes on Oncoral now. Oncoral is designed to transform the delivery of irinotecan, a well established chemotherapy that today is administered intravenously at a relatively high dose every week every few weeks. By enabling daily oral dosing, Ongrol has the potential to provide more sustained drug exposure, improving both efficacy and tolerability while offering a more convenient treatment option for patients.

10:26 What makes Ongrol particularly interesting is that it's not simply an oral version of irinotecan. The oral formulation enables a fundamentally different treatment paradigm. Conventional irinotecan is administered as an intermittent high dose therapy resulting in high peak drug concentrations followed by extended periods with little or no exposure. In contrast, Oncrol is designed for daily low dose administration providing

10:55 profile over time. Importantly, this sustained exposure may do more than simply kill tumor cells directly. A growing body of evidence suggests that metronomic chemotherapy, so daily dosing, can also influence the tumor microenvironment through mechanisms such as angiogenic activity and immune modulation. As a result, Oncoral has the potential to combine the well established antitumor activity of irinotecan with additional biological effects that are difficult to

11:26 achieve using conventional high dose intermittent treatment. So taken together, we believe Oncoral represents an opportunity not just to improve the delivery of irinotecan, but potentially to expand the therapeutic potential of the drug.

11:44 We increasingly view Oncoral as more than an oral irinotecan formulation. It is a platform for optimizing how irinotecan is dosed. The emergence of FDA's Project Optimus reflects a broader shift in oncology from pursuing the highest tolerable dose toward identifying the dose that delivers the best balance of efficacy, safety and long term treatment benefit. Oncoral is inherently designed around that concept. By developing sustained daily dosing by Oncoral, we aim to unlock the therapeutic potential of our Urena tekin in a way that may improve tolerability while maintaining or potentially enhancing efficacy. Our phase one data provides early validation of this approach, demonstrating a pharmacokinetic profile suitable for metronomic dosing together with encouraging safety observations.

12:41 Our current plan is to bring Oncoral into clinical phase two in gastric cancer. Animal data has demonstrated a synergistic effect of Irinotecan when combined with Lonsurf, another oral cancer treatment already approved for gastric cancer, which makes this all oral combination very interesting.

13:03 As we look ahead, it is important to remember that Oncoral is built on Arinotecan, a well established and widely used drug in oncology. Gastric cancer is our lead indication and represent a significant commercial opportunity in its own right. But the real strategic value lies in the potential applicability of the onchoroid dosing concept across multiple tumor types where areinotecan is already clinically validated. We are actively evaluating these opportunities as part of our development strategy and believe we have only begun to explore the full potential of the program. In short, we are not just developing a new formulation of Irinotecan, we are developing a new way of using Irinotecan with the potential to create value across multiple cancer indications.

13:55 Let's move on to the update of the financials, Anton. Thank you, Andreas. In q two, our operating results amounted to a loss of 12,000,000 Swedish kronor, and the costs are lower in the quarter compared to q two twenty twenty five due to completion of the NDA.

14:20 If we move to the liquidity, at the end of June, we had a cash cash position of 38,000,000. And in April, we completed a directed share issue, raising 20,000,000 kronas before costs. And following the complete response letter, we implemented cost saving measures and have now extended our cash runway into q two twenty twenty seven. I will now hand over to Magnus again. Yep. Thank you, Anton. We have some important milestones ahead. On September 9, we will meet with the FDA to align on the path forward for Overglens. The potential partners have confirmed continued interest in Overglens and getting clarity on the path ahead is important for getting a partnership agreement in place.

15:06 We manage our finances carefully as always and through cost reduction initiatives, we have extended the cash runway into Q2 twenty twenty seven. We are not where we hope to be at this point. We have a clear plan, clear inflection points, and there continues to be an attractive opportunity for Oragland's, and we are committed to bringing Oragland's to the patients who need it. Thank you for listening to our q two update. Operator, we'd like now like to open up for questions.

15:49 The next question comes from George Tigalunov Bjork from ABG Sundal Collier. Go ahead. Thank you. Hi, George here from ABG. Yes, so I'm wondering regarding this complete response letter, obviously, very important these days. To what extent

16:14 as a design of T1 versus T2 weighted MRI and the reason there has been significant topic in the discussions side of the complete response center. I'm also wondering if you're able to provide any flavor on what you're hearing from your industry contacts regarding this afterwards. Yes.

16:38 Maybe I can start on the partnering, and then Andreas can talk about the T1 and T2. So on on the partnering, as we said, we, you know, we we have, you know, an ongoing process. We have been having a lot of dialogue with, you know, number of companies. Everybody were expecting an approval, and and this kind of is a here's an engine, a bump on the road in in that dialogue. We are meeting with the FDA to get clarity on the path ahead, and that information is gonna be important for the partners. So, you know, there there's still a process, but but time timeline has obviously shifted a little bit because everybody wants to understand what is it, you know, how can we resolve these issues, which I think is is important. So I think it's it's a very natural process. I'm happy that, you know, know, the potential partners who have invested time and energy, resources into evaluating the asset, which you need to be interested.

17:41 Andreas, do you want to talk about G1, G2? Yes, absolutely. I think the question was if we have had any interactions around this with the agency through the development or the review. And as we have said, we are quite surprised by the response we received. So that indicates that we have not had any questions about that. When we talk to our advisers, key opinion leaders in the field of radiology, it's quite clear that that I tried to explain in in the presentation that the the different sequences are indeed complementary to each other. So that means that you you you need to you you need them all as a radiologist.

18:27 But when evaluating a t one enhancing agent,

18:31 it is the t one sequence that is the scientifically most relevant sequence to to to to look at or the only relevant sequence to look at. I hope that was an answer to your question. And just to clarify, sort of to provide some context, the gadolinium products on the market today, they also enhance t one. And like all the glands, they don't have effect on t two or diffusion weighted imaging. So it's it's not it's not an, you would say, an unusual thing. After dosing with all the glands, when you look at the t two and the diffusion weighted, that is those images are similar between unenhanced and organ glands. So it's not like we are making any changes to that. We're measuring where there's an expected difference based on the mechanism, and that's c t one.

19:22 Great. Thank you. The next question comes from Fredrik Thor from Redeye. Please go ahead. Yes, hello and thank you. So one question was if Tesla would accept a new real read, but with all images, would there be any difficulties in doing this from your perspective or pretty straightforward? For example, when it comes to statistical power and and so on. I in that scenario, I mean, it would be to to no. That would be it wouldn't be an issue. That's the short answer. Yeah. We we have the images. Everything is captured. Yeah. Yes. So it's straightforward. Got it. And and also a second point from that day was about the risk of bias in the training. And what is your interpretation of this? And and how can it be resolved? And and do you say that it pose any risks of, yes, they are not accepting a reread? Or, yeah, can it be dissolved in in a way?

20:29 Our our view is that we have full control over the reprocess, the training process, the blinding of the the readers in the reread where where appropriate. So and this is this is one of the questions we need to clarify with the agency. What exactly is it that they have a concern about? But but we are are we we we know that we have done and you should do to to prevent biases of all sorts. And I think that was also it's the need for reread in medical imaging is not unusual. It's also in the in the public space that, for instance, some of the gadolinium agents have been approved where a reread was important part of the, submission. Obviously, no two cases are alike, but it's not sort of something completely out of the ordinary.

21:20 Got it. Thank you. That's all for me. There are no more phone questions at this time. So I hand the conference back to the speakers for any written questions and closing comments. There are no written questions as of today. So thank you, everyone, for joining the Q2 report for 2026. We look forward to updating you once we receive the minutes or, if anything happens before then. So thank you, and have a great day.