Shield Therapeutics (LSE:STX) — Q2 trading update

0:02 Good afternoon, and welcome to the SHIELD THERAPEUTICS PLC Q2 Trading Update. Throughout this recorded presentation, investors will be in listen only mode. Questions are encouraged, and they can be submitted at any time using the Q and A tab situated on the right hand corner of your screen. Simply type in your questions and press send. Company may not be in a position to answer every question it receives during the meeting itself. However, the company can review your questions submitted today and publish responses, which is appropriate to do so. Before we begin, I would like to submit the following poll. And I

0:32 would now like to hand you over to the management team of SHIELD THERAPEUTICS, Anders Santosh. Good afternoon. Good afternoon, Alex, and thank you for the introduction, and good afternoon, everybody. And if you happen to be on The U. S. Continent, good morning. So my name is Anders Lonsam. I'm the CEO of SHIELD THERAPEUTICS. And together with me this morning is Santos Schrambach, who is our CFO, and we together will walk you through the quarter two presentation and also the q and a following the actual presentation. Here's the disclaimer, and I'm not gonna give you much time to read it, but there it was, and we'll jump straight into it. So I will start by describing the company SHIELD THERAPEUTICS, our product, and the market. So iron deficiency is a is a very large market. And in The US alone, there's about fifteen million individuals every year that has iron deficiency with or without anemia.

1:34 The typical treatment for iron deficiency is a ferrous salt as an oral treatment. And the challenge here is that about forty to sixty percent of patients cannot tolerate that that treatment. Acrefer, is the brand name in The US and Feracru typically the brand name outside The US is a different type of formulation and will and I will describe it better in a couple of slides. But in short, it does not have the same tolerability profile as the oral ferrous salt has, and thereby the treatment is better tolerated and better has a better efficacy. It's approved here in The US, in Europe, in The UK, in Switzerland, and in Canada.

2:23 And I'll also come back to where what the status is for the other markets across the world where we have partnerships.

2:34 Our peak revenue of Acrefer is estimated to be around $415,000,000 yearly, and we have very strong IP through 2035. The over the big goal for us this year is to turn cash flow positive towards the end of of the year. We have a very experienced, executive team with extensive US commercialization expertise across all disciplines needed to be able to launch a product and and sustain a product in The US and across the world. David and Jackie are located in our New Castle head offices, and the rest of us are in our office just outside Boston.

3:16 So as I started to explain, you know, a couple of slides ago, the typical treatment for iron deficiency is an oral oral ferrous salt. The the challenge with these type of products is that it dissociates in the stomach, and the iron by itself cause cause irritation. And that this irritation can in turn then turn into gastrointestinal relate related side effects like bloating, dark stool, nausea, and so forth. And up to seven out of ten patients can experience these these side effects. And almost sixty percent of those patients, so about half of the patients in total, will discontinue treatment and due to the side effects. And then, of course, if you discontinue treatment, you will not have any effect of your treatment.

4:13 Aquifer is different. It's different in salt. We're not salt. We have a maltol shield covering the actual iron molecule, and it does not, dissociate in the stomach. It actually dissociates in the upper intestine where it's absorbed. And by that, we actually avoid many of those gastrointestinal side effects, giving, the patient a better experience because we have a better tolerability profile, and thereby they can stay on therapy as long as it is needed. So typically, about 90% of oral irons are salts. And before Aquifer, there was sort of no other way of getting iron.

5:02 If you couldn't tolerate the salt, you needed iron, you needed an IV infusion. So Aquifer fills a very important place in this market where we can then now be the oral alternative to patients that they do not tolerate an oral oral ferrous salt. And and this is where we are. This is where our position is, and this is why why we see the increase in prescriptions and so forth continuously because of we have so many patients that need iron. So changing gears here. So talk about our partnership across across the world. At your left, in The US, we have a collaboration with Viatris. It's a fifty fifty collaboration where they have 40 SED strips each, so a total of 80.

5:51 And we'll I'll come back to The US in a little bit. In Europe, Noregene is our partner, and the update here is we just received a milestone from them when we had, the acceptance of our pediatric file that was filed a couple of months ago. We got that milestone half of that milestone now. In Canada, Canada, CAIA has launched, and they are in the process of securing coverage with their, payers. So we'll we'll see more and more from from Canada towards the second half of of this year. In Korea, we are expecting an approval, sometime, probably in the second half of this year.

6:40 And in China, as we communicated earlier, our Phase III study is completed, and we expect them to file, during this quarter. The news here is that Japan we find a partner in Japan. We signed a deal in April, and that was also, we also got a small milestone for that. That lot of came to us during this quarter.

7:04 So back to The US. So in The US, there's about fifteen million adults with iron deficiency or iron deficiency with with anemia. The the smallest circle, the orange smaller circle is where we have have our sales force. They cover about 10,000 prescribers. Our focus is primary care and women's health. This is a market opportunity about two hundred and fifty thousand patients because that's half of the half a million patients that take an oral iron. And as I said earlier, about fifty percent of those cannot tolerate the ferrous salts. The lighter blue circle is what we initiated last year. We initiated, marketing different forms of digital market, and I'll describe them them in a couple of slides, both to health care professionals and direct to consumers' patients.

7:57 This this lighter blue circle is about 50,000 health care professionals, and here we go broader than primary care and women's health. We also target nephrology, hematology, and gastroenterology. This is about one point three million patients that have side effects from the oral iron salts. This year, we broadened this even further. As you can see, the darker blue circle, we do direct to consumer, direct to patient marketing, of course, within, you know, in our indication. And but we've gone broader. Now we we target people, the patients are seeking oral iron treatment online. And as I said, I described some of those activities in in in the subsequent slide. So this is why we have focused our digital marketing efforts. So on the physician side or prescriber side, we have we have a sampling program, so prescribers can order sample directly online.

8:56 We have something that is called electronic health record banner marketing. So if a prescriber is about to prescribe an oral iron, there's a banner served to that to that prescriber, describing Acrefer. And we also do a lot of digital advertising in diff through different channels. And as you can see, there are big numbers when it comes to impressions. The banner marketing is over 9,000,000. There's 14,000,000, impressions on digital advertising. So a lot of eyes, on the, on Acrefer, and we're doing this to drive awareness. On the patient side, we have influencers, Instagram influencers. We have three of them, and we are in the process of increasing that to eight. And also with a lot of social media advertising here as well. And as you can see, again, we we get a lot of impressions, a lot of eyes on our preference. But what does it really mean? Does it have an impact?

9:53 We can measure that by looking at how many new prescribers can we see every month. So this graph shows the impression in the bars and the number of new writers on the lines. So the the dark the blue part of the bar is what the Salesforce is doing. That's a number of visits. The purplish is the number of impressions that prescriber can have that, we have seen, and and the yellow is the number of impressions for for consumers or patients. And as you can see from the lines, well, what we why we measure new writers is because that's the purest way for us to see that that when a physician writes for the first time.

10:42 So the blue line describes that we have about 500 new writers in June if you take the month of June as an example. In addition to that, thanks to our digital marketing efforts, we get an additional 300 new writers. So, yes, it works. It works really well to to via digital marketing even though, of course, our main source of getting new writers is still from from the field force. And it could very well be that we could get as many new writers from digital marketing as we get from the field force. The good thing with that is, of course, when we get a new writer, that information is passed on to the field force so they can continue to detail that customer.

11:28 So what have the key initiatives been that sort of built the momentum and and the results we've seen in the second quarter? Well, I asked just described to you our increased awareness of Acrefour. These were the marketing initiatives that we have increased this year. The other part that's very important for this year is we optimize the Salesforce territories where we focus on territories where we historically have had had the highest aquifer sales, the best coverage from insurance, and the best access to see these physicians. And we have 80 now fully staffed territories, which was not the case in the beginning of the year, but we're fully staffed. Now it's a rather concentrated market, which is kind of interesting to see. We have six states.

12:18 That stands for about two thirds of all prescriptions. The last piece, is very important, which we were sort of is more downswing work, is to increase the number of prior authorization, which means for a physician to be able to prescribe and be for the patient to be able to receive Aquifer, you would need to fill in a form to show that they cannot tolerate an oral iron salt.

12:44 So, typically, with that, we would be approved by the payer, and the patient can get the product. So we work on getting the number of submissions up, the approval rate up so we can get the the covered fill rate up. And here we work with pharmacies that can help the offices, the the prescribers to deal with the prior approval process.

13:08 So, the last piece here, which is also important, is to leverage case managers to actually contact patients to pick up unfilled prescriptions because surprisingly, quite a few patients where everything is approved, they don't answer it on the phone, they don't ask the text messages, and you keep the reminder over and over again that Xelaxia can go and pick up their prescription, which is, of course, very important as well for everybody involved. So by that, I will leave over to Santosh. Please, Santosh. Thank you, Anders. Hello, everyone. Excited to report our q two update. As many of you have seen, the business priorities for 2025, growing at for, net revenues, especially in The United States, turning cash flow positive by the end of twenty twenty five, and expanding globally, whether it's Canada, Korea, China, the pediatric population, or recently in Japan, like Anders mentioned.

14:11 We are excited that we are making significant progress on all of these key priorities. As you can see, in q two twenty twenty five, we reported $12,800,000 in aquifer net revenues. That is double what we did in q one twenty twenty five of 6,400,000. This is obviously through both prescription growth as well as revenue pricing growth. We reported approximately 47,000 prescriptions, which is the highest quarter we have ever had since launch. That's a 30% growth over

14:44 q one twenty twenty five. And with strong net selling price as well, $231 net selling price in q two twenty twenty five, compared to a $187 in q one twenty twenty five. So across these three key metrics, we are excited about the momentum that we are continuing to see build in q two, and we believe this translates really nicely into helping us execute second half of twenty twenty five as well. Turning to cash and cash flow positive.

15:13 We reported 10,800,000 q two ending cash and cash equivalents. As you can see, that's a that's a growth compared to q one, which where we reported 10 and a half million. Now keep in mind, these are one off events that took place in q two. As Anders mentioned, we did receive $665,000 from VitalNet in support of the Japanese licensing agreement, as well as €500,000 from Norgee supporting the EMA regulatory process.

15:46 But we are on track, and we are excited to report that we are continuing to reiterate our guidance of turning cash flow positive by the end of twenty twenty five. And last but not least, from a global perspective, like, and I said, and I just mentioned, we did file our pediatric label expansion, both with the EMA and FDA. In support of the EMA filing, we did receive a 500,000 in milestone payments from Norgeen. And and we did expand our global presence through our partnership with RetalNet in Japan. Again, $665,000 payment.

16:25 That was an upfront. Plus, we expect regulatory and sales milestones with double digit royalties on net sales. So strong quarter. Digging in a little bit deeper, the this slide represents the weekly prescriptions for Aquifer in The United States. You can see the clear growth. There are ups and downs, as you can imagine, in any launch. However, the direction of travel is important here. And you can see there is significant growth since, the early days of launch and, especially after we established the, partnership with Beatrice in, early twenty twenty three.

17:06 We did end the quarter in q two with the highest prescription for a given week. You can see it was close to north of 4,000 prescriptions per week. So, you know, the performance here is strong. The momentum here is strong, and we feel pretty excited about what this means for the second half of twenty twenty five. Digging into some of these key metrics, like I said, active for net revenue is 12,800,000. Again, growth is strong, and we expect that to continue to grow into the second half of twenty five. Net price per script, we've always seen ups and downs, through this, but as long as it's moving to the top and right, that's what that's what matters. And we reported $231, net price per script here in q two twenty twenty five. And total prescriptions, 47,000 prescriptions, of which about 36,000 were actually retail, and the remaining were consignment.

18:02 And keep in mind, consignment is business that

18:07 is being delivered to the patients free of cost or at a significantly subsidized price while we wait for reimbursement by payers. The idea here is to keep that gray bar, which represents consignment as small as possible. However, we do believe that is an important part of the business driver because those gray bars typically convert into blue bars in the following quarters. Moving on to some of the details. As Anders mentioned, six states typically drive, the growth of Acrefour. We are excited about that because it does bring some diversity as people who have followed SHIELD in the past. We were concentrated on one or two states. It is good to see that we are now across multiple states, and multiple states are driving the business.

18:58 On the left hand side of this chart, can see the prescriptions by channel. Clearly, commercial is the largest portion of our business. 44% of our business comes from the commercial channel. 28% comes from Medicaid. As you can as I've said in the past, 25% comes from consignment. The idea would be to continue to make that part of the pie chart smaller while we grow the orange and the dark blue parts. And then there's 3% other. Within Medicaid, about 85% of our prescriptions comes through Texas, New York, Florida, Georgia, California, North Carolina. And so a large portion of our business comes from those six states within Medicaid. Very similar story in commercial as well. About 65% comes from those six states.

19:46 So overall, a healthy business. Revenue is growing. Prescriptions are growing. Price is growing, and we continue to diversify into the large states within The United States. And with that, I'll hand it back to, Anders, and then we move to questions. Yeah. If I unmute, we will also hear. So So thank you, Santosh. So, yes, in summary, I mean, the the iron deficiency market globally is a is a huge significant opportunity for us in in The US specifically, of course, as we have described. Our partnership with Viatris continues to

20:31 drive growth for aquifer and as Santos just described. And we I mean, still, we are only two years in, if you actually look carefully on Santos that only have two years with full sales force, and it's really only this year we actually stepped up our digital marketing efforts to prescribers and to consumers or patients.

20:55 As also described, our global partnerships continue to progress, as anticipated almost, and we have more to receive there when it comes to milestone and double digit royalties. And just for clarity's sake, with nor gene on the slide my slide said it was $05,000,000. Was 1,000,000 total euros for the pediatric filing. Half is when the file was accepted, and the other half will come when the actual indication is approved. Our our goal is to to to be cash flow positive by the end of this year. And and in addition, we're also looking for partnership opportunities so we can continue to expand our portfolio and continue to grow this business.

21:40 So that concludes the formal part of the presentation, and we can move into questions and answers. Fantastic, Anders, Santosh. Thank you very much indeed for your presentation. Ladies and gentlemen, please do continue to submit your questions using the Q and A tab situated on the top right corner of your screen. While the company take a few moments to review those questions submitted today, I would like to remind you that a recording of this presentation, along with a copy of the slides and the published Q and A, can be accessed via your investor dashboard. Anders Santosh, as you can see, we have received a number of questions throughout today's presentation. And Stephanie, if I may now hand back to you to chair the Q and A, and I'll pick up from you at the end. Thank you. Thank you. And thank you, Anders, and thank you, Santosh. First question, you talked about social media. How much does the company rely on patients independently telling their friends that works for them and using portions like social media and self help groups to inform others?

22:41 So, I mean, it's happening to an an increased ex extent almost every day. So so this really bigger push directly to patients started in the beginning of this year is taking a few months, as as you saw on the slide, to get a get into good momentum. We continue to increase, for instance, the number of Instagram influencers. We are about to launch, patient stories as well, patient testimonies, and that we will actually share one with you as we conclude this call.

23:14 So it is an important part when it comes to drive new prescribers. It's also an important part where we also, as as shown, can go a little bit outside our core, target groups to have patients to go to those physicians and and ask for for AcreFer as well. So if if we, as of you, can get 300 out of 800 new prescribers directly from these type of activities,

23:43 we expect that to continue to increase. There's so many numbers to throw around them, and and, actually, it's kind of amazing on how in how many SHAD forums and and and other fora that is iron deficiency is actually discussed. And and what we've done with our latest push is to identify where these people actually are. And instead of, yes, going after those who had a bad experience with another oral, salt, as we said, we expanded that to people who are actively looking for treatment. And it it is quite a few. It's, you know, how far this can go, very, very hard to tell, but it it has a very it has a positive impact on on the prescribing of Aquifer for sure.

24:35 Thank you. Also, could you remind us about once a patient becomes a patient, is that patient then long term? Well, we actually have we didn't share data about that. We have followed cohorts of patients that has, started to use, Acrefer as a direct result of digital marketing. So the short answer is yes. They they continue to use it. But keep in mind, for most patients, aquifer is not a chronic therapy. They typically stay on therapy for somewhere between three to four months. But if they need it again, yes, we see that too. When we have that data a little bit clearer, it's something we plan to share at our next quarterly update. But the short answer is yes. We see that.

25:31 Thank you. How are we expecting prescription numbers to grow and to continue to grow into q three?

25:38 Santos, I think that's for you. You're the numbers guy here. Absolutely. Absolutely. I think our intent is for prescriptions to grow and align with pricing and revenue. So like Andy said, you know, we are we are still in the early days of launch, and you should expect to see growth over, you know, over the quarters. Now there may be some quarters, where it's the growth is not as high as the others, just because of the way the market dynamics work, but, you should expect to see growth, over the year over the quarters and years. And if I may add to that, is that I mean, as Santosh also earlier said, and if you I mean, now we we know we we show, you know, a slide if know, not not that long, but on the slide where you had the prescriptions, you see the momentum. Right? We said that already in the first quarter, yeah, we exited, you know, the first quarter with a very good momentum, meaning that the number of prescriptions per week as we measure it continues to go up. So we same thing here.

26:43 End of June, highest ever. So so that that's why we we can we expect to see continued growth. But to Santosh's point, I mean, what the number will be, it's it's very hard to tell. Right?

26:56 But it we have very good momentum in our business, and we've seen that since the since, actually, the beginning mid middle March of this year when we were almost fully staffed and when these digital activities started to kick in.

27:11 Thank you. What types of partnership opportunities are being targeted to expand the portfolio?

27:19 In short, I mean, we we're pretty agnostic, actually. And and the reason for saying that is that we we've almost soon shown that you can go, you know, start making money with the with the one being a one product company. It it's actually not not the ideal to have an or whole organization relying on one product.

27:44 Acrefor by itself, as described on on, you know, one of the slides, has quite a few of different types of prescribers. I mean, now we focus on primary care. We focus on women's health, but we also started to focus more on nephrology, hematology, oncology, gastroenterology. So we can look for products in very many different therapy areas that and that would be complementary to aquifer itself. That's number one. Number two, I would say, we could go to different areas as well. I mean, I think we we've shown that we are able to take a product, commercialize it. And and as we said, we we do believe still that we are able to go breakeven in the end of this year.

28:31 So so and then I mean, that the hard part really here is to set everything up, make sure everything works, get everything in place. What what I mean by that, having a Salesforce, having marketing, having commercial operations,

28:44 having commercial analytics, and all all other things, regulatory, manufacturing. All of these things you need to sort of medical to to be a sort of a a fully integrated company. You know, if you if you done it once, you can do it twice. You can do it three times. You can do it four times because we have this very strong, organization and very strong backbone. Anything you wanna add, Santosh, there? Sure, Anders. I mean, I I think I think this goes without saying, I guess, but our number one priority is Aquifer. Right? Aquifer is where we are going to spend all of our energy, time to make sure that it grows and continues to meet its of $450,000,000. Right? That that's that's the objective. I think number two is, to Anders' point, I think we've got an amazing infrastructure that can help commercialize the second product. What that also means is we will be looking for products that are commercial in nature. So we're not looking for phase twos, phase ones. You know, we we don't have the resources to be able to push that all the way through commercialization.

29:48 So we'd most likely look for something in a phase three or, or an FDA approved product to help support, to help leverage the infrastructure that we have that Anders just talked about. Yeah. Thank you. Are you still currently recruiting in your Salesforce, or is this now being completed? It is it is more or less complete. I think we may be I think we're almost complete. It it could be we need one more, but it is it's it's basically we're basically done, which is, of course, has a huge impact on the results we see, compared to the beginning of the year when we were looking for a number of of new positions, to to fill the Salesforce. But we're basically done. Unfortunately, as soon as you say done, you probably you would need somebody leaves. It's it's typically the nature, but we're more or less fully staffed.

30:45 Thank you. One question is how much further headroom do you think this still exists above the $231 net selling price? Yeah. I mean, I I think there is enough headroom if you look at the ups and downs of pricing. There there are so many factors that bleed into it. You know, what percent of our channels was commercial, what percent was Medicaid, what percent was consignment. As we have said before, we wanna reduce the consignment channel. That'll only help increase the price. However, when we get on the commercial side, the more contracts and rebates that we have, that can have an impact on price. But overall, I think, high level, I think there is more room to grow on the pricing. There is I I I think at some point in the past, we have said, you know, we we like we like to get to somewhere around the $2.50 range. I think that's a good marker for us. It's gonna be tough, I think, to get there quickly, but I think there is room to get there. Hopefully, that helps address that question.

31:49 Thank you. And somebody's also asked as well if you can expand on what the current market for iron is, oral iron and IV iron in The US and globally. I mean, the IV iron market, to be perfectly clear, we we don't follow that one. We there there's nothing we can really do there. If somebody needs an IV iron, we we cannot be the a substitute to that. We can be a follow on to an to a patient that's has received an IV iron to keep, for for to for that patients to continue to have a good level of of iron in the in the body. As as one of these these slides shows, I mean, still over 90% of of actually, of used iron used is still salts, oral iron salts.

32:47 Of the prescribed market, I for I should know, but I there's still a lot of room. I don't I mean, our our market share in the prescribed market is we still we're maybe we have a third. I don't think Sunshine, I might yep. Do you have the number of the prescribed market? I know we have a slide on that somewhere. Yeah. I mean, I what what was it? We have about 15,000,000 patients in The United States. Yeah. That's the overall market. I believe that that sounds it's about twenty, twenty five million in in total prescriptions. So, I mean and and The US is the largest driver of of the business in in the space specifically for us. We do have China that's pretty large. Just given the population there. Yeah. Course. US is the largest driver for us in terms of market opportunity.

33:39 It is. Thank you. How concerned are you regarding pending tariffs? You want me to take that, Andy? Yeah. Please do. Yeah. Yeah. I think short answer is not very concerned, but let me give you a slightly longer answer. Right? I I think as we have all been following the tariff situation, it is pretty volatile, and and trying to build out a strategy or a tactic given the volatility doesn't doesn't make sense right now. I think number two is we have built up a decent amount of inventory just to run the business, just running business operations.

34:25 So we are in a favorable position there where we don't really have to make quick decisions right now because we do have a decent amount of inventory sitting here in The United States. We'll continue to bring more product in to support the business, but it's not gonna be a significant impact to us. And and, obviously, number three, I, you know, I I think it is important to note that we bring our products in at cost. And so this really is not a revenue issue. It is more more of a gross margin issue. And given our cost, I'm not too concerned about what that means as an impact to our gross margins either. So we we'll keep a close eye on it. Right now, we are not doing anything as a company to address the tariff situation because, honestly, it does not really impact the business a lot. However, we'll keep a close eye on it. And if it starts to have a larger impact, then we will start taking action.

35:18 But right now, there's if the the issue is, not, not a big one for us right now. Thanks. I note that 10 new I'm sales staff joined in q one twenty five with another seven sales staff in q two twenty five. Are you now looking at increasing the sales staff beyond the stated limit now that sales are increasing? So we so just to be very clear, there's a there's 80 salespeople in total between us and the others. That's the number we should look at. No. That's what we that that's the number we'll keep at least for this year. If we continue to see growth, we might change that and go back to having a 100 people again.

36:09 But for now, we'll we'll stick with 80. 80 is the number. 40 per company. Thank you. You've also mentioned about the pediatric program. Can you share some more information on this program and the potential? So we're looking very closely into that. It's two parts, you can say, of the pediatric population. One is so patients over the age of 10 or basically anyone who could swallow a capsule, they would be they would use the current product. The younger people and and, I mean, from a from a baby from a newborn to a baby to a toddler, here we need to bring the suspension that to the market for them to be able to use the product.

37:03 We are starting to look into what the market opportunity is anecdotally. If you speak to pediatric nephrologists, they see a big need and other pediatric quest other subspecialties that deals with patients that has iron deficiency. Yeah. Yeah. We we believe there could be quite a big need there as well. For instance, instance, children with ADHD, a third of them have iron deficiency because they don't eat properly. So so there this might be a a bigger opportunity than we anticipated from the beginning. But then in The US, we are we're doing the, the market preparation work right now.

37:55 And in in Europe, Norwegian is doing the same thing. Thank you. And somebody just asked on the back of the sales questions was why can you remind us why we actually reduced the Salesforce from 100 to 80? So we did that looking at the all the territories we had last year. And then if we were to concentrate it, making them slightly larger and looking I mean, by the end of last year, as you've you've seen from from one of the slides, we had about eighteen months of data.

38:41 Before that, we didn't really have good background data about where Acrefour sales is where where was the best Acrefour sales? Where did we have the best best, payer coverage? And where will we have access to actually speak to our our customers? And then we came to the conclusion that in about 20 of those territories, we didn't make any money. We couldn't we didn't even make the salary of a salesperson. And with the financial situation we had towards the end of last year, this was a necessity to to go down to 80. Turns out, of course, with the with the with the $10,000,000 investment we got from AUP, we we could have gone back up to a 100.

39:28 But what we instead did, we we stick to get and this was a joint decision with the others. We stick to 80, which was 80 top performing territories and increase the investment in digital marketing instead. And as we've shown, we believe this is a better, mix of having the number of territories and the money we can now spend in digital marketing. But as I said, as we continue to grow and as we can can continue to get new prescribers, this is something we'll be revisiting by towards the end of this year. Then again, with even more data, other other places where we where we would benefit from having having more more territories. And here again, with digital marketing, this can lead us to to new territories back to, you know, a number again, whatever that number would be to get rid of the artist.

40:19 If you just look at market penetration, which we tried to answer earlier, we're still scraping the surface of this market. There's so much more we could do, but, of course, we we need the financial strength to be able to to invest even more behind sales and marketing. Thank you. What is the confidence level based on the current trajectory that SHIELD will be cash flow positive by the end of twenty twenty five? That's a that's a question for the CFO. Well, I I haven't got confidence interval. I haven't run any statistical analysis, but I think you should you should take away that we have a high level of confidence given that we just reiterated our guidance on turning cash flow positive by the end of twenty twenty five. Thank you.

41:08 Somebody's asking as well, would it be possible to understand the trends in repeat prescriptions? As I said, I I sorry. We can't sort of have a live conversation here. Depends on what you there's so many different ways to repeat prescriptions. So let me tackle it. I already described that one patient typically is on for three to four months. That that's one way. Then would if the question now is more, oh, but is that now this is that prescriber then keep prescribing the product for other patients? So so let me tackle that part then. Yes. We see that. So what we every territory, every salesperson have a top 25 list of customers that they focus more on than than the rest of of of their customers in that territory.

42:04 What we are driving towards, even though I showed the slide with new prescribers, we're driving towards that. Because if somebody starts to prescribing, they are very likely to continue to prescribing because we know the products works really the product works really, really well. So, yes, this is a very strong focus on getting our top prescribers to prescribe more. So and this top 25 list we have per territory is also it's updated every quarter. So we so we keep going after the top 25 highest prescribers. But when I say highest prescribers, we also take into account what the potential is for each of those top 25 prescribers.

42:51 So we so if that is the repeat prescription question angle, yes, we do that. If it is per patient, it's it's more it's very different. It's a different question. Actually, we now have data because we just purchased claims data. So we can see the history of a patient as well now. We are analyzing that type of data. So if a patient, we can see their their what was the journey? Where did they start? How did they continue and so forth? So we should be able to get get you a better answer on on per like, a per patient on per patient angle, when we have this call in in in in three months. Thank you. We've got one 47,000 prescriptions at $231 is 10,800,000.

43:42 We've reported 12,800,000. Is this adding inventory ahead of the July 4 holidays? This is a great question, and, it seems to come up, almost every quarter. So, keep in mind, there's a prescription, which is the prescriptions that we, know that patients picked up. So these are dispensed prescriptions. When we recognize revenue, we recognize it based on the sale of a title to our wholesalers. So the revenue is linked to the sale to the wholesalers or a shift of a title from SHIELD to the wholesalers, while the prescription is downstream from there, which is from the wholesalers to the pharmacy to the, to the patient. And so we report the prescription as a dispensed prescription to the patient, is why you would see the disconnect. I would not divide the prescription or or the revenue divided by the prescription to get the price because that's not the right math when we look at revenue.

44:40 To the question about specifically about inventory buildup, I there there is potentially a little bit of a buildup in ahead of July 4. Those who have followed us for a while, you you probably heard us say it's something similar last year as well. We see that trend pretty much all the time. It is it's not a significant amount, but a a decent amount because July 4 is a is a week where a lot of people take off and it's just planning for that week. And it just so happens that it's a cusp between q two and q three. So we saw a little bit of that. We may see an impact of that in q three. We'll we'll keep an eye on that, but it should not significantly change the trajectory of of the group. K. Thank you.

45:26 Can you also discuss what progress Norgein is making within Europe? Yeah. We absolutely. So so Norgein, the the focus focus focus markets, sorry for my bad English, for Norwegian in Europe is, first and foremost, Germany. They continue see to see growth in Germany. They also changed their business model slightly, so they also are now using the digital channels more than before. Of course, the big difference between US and and and Europe is that you cannot order it into patients, but they've been successful doing that that that with doing digital activities directly to to the prescribers. They The UK, see the same thing. It's, it's slightly smaller than Germany. We continue to see very, very, very strong growth in The UK as well.

46:18 Then in, also in the Nordic countries predominantly Sweden, and and and I believe it's Norway or Denmark, but Sweden is the main is the main market there. Those are the the main markets for for Nordgene. So that that's what they do. And but we continue to see growth. We con I mean, we we typically we haven't commented on the milestone revenue in this update that will come in when we give you an update on the first half's financials in a a few weeks, in a month. Santos, that's I don't know exactly when we're ready, but that will then we will share also what how they are performing and what our royalty revenues are from from Nordeus. So we give you more details. Yeah.

47:05 Thank you. Can you please explain as well how revenues and cost of sales are generated by the the actress team are reflected in SHIELD's accounts? Oh, yeah. Sure. I can take that. So it's it's pretty simple. The revenue that we recognize on our p and l reflects the revenue associated with Acrefer in total. So that's the total revenue that gets recognized. Whether it's VHS or SHIELD, it it gets recognized on our top line as revenue net revenue. The share, the 45% that we need to pay Beatrice, because that's the share of their revenue, gets gets booked as cost of revenue. It'll So hit your cost of cost of revenue, and you'll see that there.

47:53 So it's pretty straightforward. So total revenue on our top line and the cost of revenue is where Viatris takes their share. Thank you. Got one question here. Given the large population, are you considering expanding to India in the future? Well, that's been on the table. We we don't have any company that's shown really strong interest for India as of yet. We are looking into other geographies, though, Middle East or North South Africa, Latin America, where we do have quite a lot of interest to to take the product there.

48:40 It it all comes down to pricing, actually. And and but if we have a company that will be, you know, interested in bringing our product to India, there there's a business case that makes sense for them, yeah, we will, of course, be interested in doing that. Thank you. Please, can you provide some more information on the relationship that you have with Theatrice? You mentioned earlier that they were pleased with progress. So the the relationship is in the way that we have Salesforce that it's we we have 40 reps. They have 40 reps. Santos just described the overall economics. It's a fifty five forty five split.

49:29 We are responsible for marketing, medical training. They are helping us a lot with getting payer access. They have a very experienced and strong team to do that. That that's basically how it works. It's governed by the joint joint committee. We we meet every three months, and, of course, there's a many more meetings with on on the commercial sales and marketing side between the two companies as well because we it's a it's a true collaboration across every function even though we have some responsibilities and they have other responsibilities. It's still a true collaboration between the two companies. Thank you.

50:16 When can we expect pediatric approval to be received? Well, in the EU, with I would say sometimes early in sometime early next year. For sure, the first half of next year, US is a half step behind. We have submitted, but it will take us another six, seven, eight weeks before we know if the file is approved and confirmed. We passed that step in in Europe, and that's why we received the milestone.

51:03 Thank you. Q two showed some strong growth, how do we get from 40 to 50,000,000 of annual sales to 450,000,000 annual sales? By continuing to grow the product. So so it's a it's a great question. Right? So there's a couple of of things you can look at there. One is, of course, is how much time do we have in in the market. And as as we mentioned, initially, we have very strong IP through 2035, so which is another ten years. So knock on wood that we don't have any generic filers, which we don't have as of sitting here right now. That's one. Two is, as as we described before, it's it's a it's an enormous market. It's it's super big.

51:54 So if we can continue to grow as we do and continue to grow into other specialties as we do now on the on the marketing side and then, you know, steadily continue to build out the Salesforce, that's the way to get there. That is how we model it. We actually to get there, you probably would be rather surprised on the not so aggressive yearly growth you would need to see until the early twenty, thirty years to actually see that you actually can get to that number. So it's it's nothing that it's not a number we sort of pull out or have, and it sounds like a good number. There's some very robust model behind that.

52:42 And with the growth we've had historically over the last few years, that is how that is what we can would use, and that is how then 100% team will input from, of course, our other commercial people very close to the market, how we get to that number. I don't know you wanna add anything more precise methodology wise onto that. Oh. I think he's just frozen. Oh, frozen. Okay. Yes. Let me just bring him back in. Him rejoin. Yeah. He looks stunned, but I don't think the question stunned him. I don't know what happened. Here we go. Perfect. Santosh, you are back? Am I back? Oh, wow. I don't know what happened there. Sorry. I don't know either. I said that maybe the you were stunned by the question, but I don't think so. So I just asked you just to ask you, you know, if you could put some more light in how we get to the $4.50 for Yeah. Yeah. No. I mean, keep in mind, we are early days.

53:41 Our our penetration in the market is is low single digits, so it is really, really small. Our biggest challenge right now is awareness. Right? The our product is clean. I think the physicians who write it seem to like it a lot. Patients who use it, they seem to like it a lot. So our problem is awareness. And I think the, programs that Anders just alluded to earlier part of the presentation where where marketing is going to be an important lever to help us get there, I think that's that's gonna be the key driver. And, of course, our Salesforce being more efficient, but marketing is gonna be the key driver. And so I I I think it's I think that's what you want that's what we need to do to help get to the 450, awareness specifically for marketing. Yeah.

54:30 Thank you. In q one, you reported 27% consignment based prescriptions, and in q two, you've reported 23% consignment based prescriptions. Can you explain the impact on these consignment based prescriptions and what they have had on revenues announced so far? Yeah. Yeah. I mean, Go ahead. Go ahead. You you started explaining it before when the impact happens and so forth. Yeah. Yeah. So, I mean, you know, consignment is kind of a double edged sword for us. You know? There's a part of it which is because we give it for free or extremely low price, it either has a zero revenue impact or sometimes a negative revenue impact because the net revenue is actually lower than zero when it for cons some consignment channels.

55:16 What we have done internally and the commercial organization has done a great job with this along with the addresses, they have they have sliced and diced the consignment channel in multiple ways to figure out the the ones that are actually not profitable and not and will not generate business in the future. So we have looked at that, and we have tried to make that at least breakeven or make some amount of money on that one. Now we wanna be careful because some of these patients actually need the product but cannot afford it, and they don't have insurance. So we don't want to leave them high end. Right? So we're making it avail but available to them such that it doesn't create a loss for us. And then there is the other side of the sport, which is we do wanna give there's something going on. Our network is down, I guess. But we do wanna give, patients access to our product while they wait for their, peers to, work out the reimbursement aspect of it. Now we don't want them to wait for for weeks and months to while the payers get their reimbursement process underway. So while they wait for the reimbursement process to be underway, we give it to them for free. Now that's a that's a good channel for us because, basically, what that means is we do give it to them for free for a month. But to Anders' point, you know, most of these patients are on the product for four, five months.

56:40 So the first month is free, but the following three or four months will be paid for, by the payer, which is what the process should be. And so it is a double edged sword. We wanna keep it as small as possible, but the part of the consignment channel that we keep, we wanna make sure that it leads to business in the future. Hopefully, that's helpful. And if you wanna add anything No. That's it is. That's that's spot on. And and, I mean, to to the question the way it was asked, it was 27% in the first quarter, it's 23% in the second quarter. It goes in the right direction in in in our view. It's still an it is an important part to drive growth still even though it's very hard for us to sit here and just explain in in words what was the revenue impact because it's such a mixed bag of prices, from from as Santos said, from negative something to something something. So but it is an important part of growth.

57:36 Thank you. And I've got a last question here as well. With future trends, what are you seeing as being more profitable, digital marketing or the actual Salesforce? Great question. As of now, I think the baseline still is to have salespeople out there. Could this go one day so that you could only do do it digitally? Maybe. It's not it's not impossible. Could they be equal contributors? Possibly. Who it's it's really, really hard to know. There's so many things you can do in the digital side potentially, going forward.

58:23 I am still a firm believer that the Salesforce will be needed for pull through and and and other things to help and assist the different offices with whatever it may be, actually to to, in the end, to get the product to the patient. I think they they are it's a good thing they can do this hand in hand. I think that that is what I see. Santosh, I, you know, I invite you to your view as well. So, I mean, we we you know, there's so many things you can ask that answer this question, I believe. Yeah. No. I think I think you said it perfectly, Arun. I mean, the only thing to say is we we just truly just started marketing. You saw, Andrew, the slide, some of those initiatives were starting in June, some of them in March, April.

59:10 So I think it's a little too early to make a call on which one is more profitable. I think you do need both, but but we can we can decide how we spend the dollars and allocate capital in the right way as we see how effective marketing is. Not every marketing program is effective, and I think what is important is our marketing team cuts off those programs that are not effective quickly and trans translates those dollars into programs that work. So it's still early days. I I think it's too early to call that. Yeah. That's great, Anders, Santosh. If I may just jump back in there, and thank you for addressing all the questions from investors today. And, of course, the company can review your questions submitted today, and we will publish those responses on the investment company platform.

59:57 But, Anders, before before I I redirect investors to provide you with their feedback, which I know is particularly important to the company, could I please just ask you for a few closing comments? Sure. Absolutely. So I I we actually like to close with this. I think we we answered all the questions. Somebody I saw in the also in the q and a, somebody asked if we're using patient testimonials. Yes. We are using patient testimonials, and this is a very I will say this is a typical one in a way where you have a, you know, a young mother that couldn't tolerate an an oral iron salt. Infusions didn't work out for her either, and she was very happy that Aquifer was was the alternative. And and, typically, after five weeks, as as she states, my hemoglobin was finally in the twelfth, which is the which is the number you want to reach. It doesn't matter if you don't know what it means. It's the number you wanna reach. And she also says, I reached my doctor and known about Acrofor sooner. And that is really a key point and what Santos just stressed as well. It's awareness. We're working on awareness, but this is a very typical case from from for a patient. And, of course, this is we're very happy to to receive patient testimonies like this one. By that, I'd like to say thank you. I know we're one minute over. Sorry for that.

1:01:11 Because we also would like your feedback, and I will leave you know, I leave it as a thank you, but and have Alex conclude. You so much. Fantastic. And, Santosh, thank you once again for updating investors today. Could I please ask investors not to close this session as you will now be automatically redirected to provide your feedback in order that the Board can 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 would like to thank you for attending today's presentation, and good afternoon to you all. Thank you all.