Quarterly Report • Nov 4, 2022
Quarterly Report
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January – September
■ Leadership team expanded to seven members to prepare for expected growth.
Successful final results from Orviglance Hepatic impairment study marks the completion of the second study in the ongoing clinical program for registration." "
| Q3 (Jul-Sep) 9M (Jan-Sep) |
|||
|---|---|---|---|
| 2022 | 2021 | 2022 | 2021 |
| OPERATING RESULTS (SEKm) | |||
| -29.6 | -32.7 | -94.8 | -98.8 |
| EARNINGS PER SHARE (SEK) | |||
| -0.77 | -0.82 | -2.25 | -2.80 |
| CASH FLOW FROM OPERATIONS (SEKm) | |||
| -32.5 | -30.7 | -96.6 | -84.3 |
| LIQUID ASSETS INCL. MARKETABLE SECURITIES (SEKm) | |||
| 179.8 | 291.0 | 179.8 | 291.0 |
Ascelia Pharma continued to make strong progress on our clinical projects in Q3 2022, particularly the important Phase 3 program with our investigational magnetic resonance imaging (MRI) contrast agent Orviglance®. We have successfully completed two clinical studies – Hepatic Impairment Study and Food Effect Study – that have run in parallel with the pivotal clinical study SPARKLE, which is a solid step forward in our preparations for regulatory submission and approval of Orviglance.
Orviglance Phase 3 program. In September, we announced the successful final results of the Hepatic Impairment Study confirming that Orviglance is well tolerated in patients with hepatic impairment. These results mark the completion of the second of three studies in the ongoing Phase 3 clinical program for registration of Orviglance. Data from the Hepatic Impairment Study will be included in the marketing authorization application to health authorities, including the U.S. Food and Drug Administration (FDA) and European Medicines Agency (EMA). The previously announced Food Effect study successfully concluded that Orviglance image enhancement was not impacted by a light meal. The ongoing Phase 3 study SPARKLE, which is required for a subsequent regulatory submission, is expected to complete patient enrollment by the end of this year. We continue to provide support to study investigators at all active hospitals to enroll patients.
Continued strong scientific interest in Orviglance. Results from the Food Effect Study were accepted as an oral presentation at the world's largest radiology conference, RSNA, which will be held November 27 – December 1 in Chicago. We are very pleased that the study has been selected for presentation. The results further support our previous findings on the ability to provide image enhancement to MRI scans with Orviglance.
We remain committed to Oncoral. We continue to plan for a Phase 2 study of our other candidate drug Oncoral, which is a novel daily irinotecan chemotherapy. Our clinical development team is now fully focused on Orviglance and we will start patient enrollment in the Oncoral study once we are certain this will have no impact on Orviglance devlopment.
Expanded leadership team and management changes. After the Q3 reporting period, the Ascelia Pharma leadership team was expanded to seven members who are responsible for all the important line functions. The expansion of our leadership team is an important step in our preparations to successfully transform Ascelia Pharma into a commercial stage company. In September, Déspina Georgiadou Hedin joined us as our new Chief Financial Officer (CFO), and I am confident that she will contribute strongly to our growth journey ahead. Our Chief Medical Officer (CMO) Carl Bjartmar has decided to retire by the end of 2022. I want to thank Carl for his invaluable contributions to Ascelia Pharma over these years and wish him all the best.
Solid financial position. Our progress requires access to liquidity. We have a solid balance sheet and closed the third quarter with 180 MSEK in cash, which will take us into Q4 2023. The liquidity position will primarily be used for the ongoing Phase 3 program with Orviglance regulatory submission and market launch preparations.
Looking ahead. Our prime focus in 2022 is unchanged – to complete the clinical Phase 3 program for Orviglance and continue preparations for NDA filing and commercialization. I look forward to updating you on our achievements as we bring Ascelia Pharma successfully forward.
CEO
To be a leader in identifying, developing and commercializing novel drugs that address unmet needs of people with rare cancer conditions.
Our headquarter is in Malmö, Sweden, and our US base is in New Jersey. The shares in the company are listed on NASDAQ Stockholm (ticker: ACE).
Orviglance is our novel non-gadolinium diagnostic drug (contrast agent) to be used in MRI-scans of the liver. Orviglance is developed to improve the visualization of focal liver lesions (liver metastases and primary liver cancer) in patients with impaired kidneys at risk of severe side-effects from the gadolinium contrast agents currently on the market. Orviglance characteristics:
Oncoral is our novel oral chemotherapy tablet developed initially for the treatment of gastric cancer. Irinotecan chemotherapy has an established potent anti-tumor effect. Oncoral characteristics:
Liver MRI contrast agent in the final clinical Phase
Ascelia Pharma's lead drug candidate, Orviglance, is a contrast agent used in Magnetic Resonance Imaging (MRI) to improve the visualization of focal liver lesions (liver metastases and primary tumors). The liver is the second most common organ for metastasis after the lymph nodes. Detecting liver metastases at an early stage is crucial for determining the right treatment method and the patient's chances of survival. Studies show that the five-year survival rate can increase from 6% to 46% if liver metastases can be removed surgically. An accurate MR scan using contrast agents is therefore critical to evaluate the possibility for surgical resection, but also for monitoring of treatment effect and surveillance for recurrence of the disease.
Orviglance is an orally administrated contrast agent used in MRI of the liver. It is based on the chemical element manganese, which is a natural trace element in the body. Orviglance also contains L-Alanine and Vitamin D3 to increase the absorption of manganese from the small intestine into the portal liver vein. From there the manganese is transported to the liver where it is taken up by and retained in the normal liver cells, also known as the hepatocytes. The high manganese uptake causes the liver parenchyma to appear bright on MR images. As liver metastases are not liver cells, they do not take up manganese and consequently metastases appear dark on MR images. With Orviglance, liver metastases are consequently easier to identify due to this contrast effect.
In November 2022, final results from the Orviglance Food Effect Study will be presented at the RSNA annual meeting in Chicago, Illinois. The conference will be held November 27 – December 1.
In September 2022, the successful final results of the Orviglance Hepatic Impairment Study was announced marking the completion of the second of three studies in the ongoing Phase 3 clinical program.
During Q2 2022, results from the Food Effect Study was announced. The results showed intake of a light meal prior to Orviglance administration provides similar liver MRI enhancement compared to a fasting condition. Further, results from an independent market research with 270 healthcare professionals in the US was announced. The results showed, among other things, that 84% of healthcare professionals will likely use Orviglance for MRI scans of patients with cancer in the liver and reduced kidney function.
The target group for Orviglance is patients with severely impaired kidney function. This patient group is at risk of serious, and potentially fatal, side effects from using the currently available contrast agents. These contrast agents, which all are based on the heavy-metal gadolinium, carry Black Box warnings for patients with severely reduced kidney function.
The conducted clinical trials show that Orviglance is a safe and effective contrast agent and offers a significantly better alternative than unenhanced MRI (i.e. MRI without contrast agent). Consequently, Orviglance fills a significant unmet medical need to improve the diagnosis, and subsequently, the treatment of liver metastases and primary liver cancer.
The immediate addressable market for Orviglance is estimated at \$500-600 million yearly and Orviglance is expected to be the only gadolinium-free product on the market for this patient segment.
Orviglance has received Orphan Drug Designation from the FDA. One major advantage of orphan drug status is, among other things, that orphan drugs can obtain market exclusivity for a number of years after market approval (seven years in the US and ten years in the EU/EEA). For orphan drugs in general, the time to approval is also usually shorter and the proportion of orphan drugs that are approved is higher than for non-orphan drugs.
The ongoing pivotal Phase 3 study SPARKLE is a global multicentre study in up to 200 patients. The strong results in the Phase 1 and Phase 2, both in terms of safety and efficacy, studies provide a solid foundation for the ongoing Phase 3 program. This is underpinned by the high degree of similarity between the primary endpoints in Phase 2 and Phase 3, and since the Phase 3 study comparator for Orviglance is MRI with no contrast agent. In addition, the follow-up time is less than a week, compared to months or years for the typical Phase 3 oncology study.
| NUMBER OF PATIENTS | Global ongoing study in up to 200 patients | |
|---|---|---|
| ENDPOINT | Lesion visualisation • Lesions border delineation (border sharpness of lesions) • Conspicuity (lesion contrast compared to liver background) |
|
| COMPARATOR | Unenhanced MRI + Orviglance MRI vs. Unenhanced MRI | |
| EVALUATION | Centralised evaluation by 3 radiologists | |
| RANDOMISATION | No – each patient at his/her own control | |
| FOLLOW-UP | Less than a week |
The completed Phase 1 and Phase 2 studies have shown strong efficacy results regarding the endpoints that will be evaluated in the Phase 3 study. The completed studies, involving 178 persons in total1, have showed a highly significant improvement compared to unenhanced MRI in:
Results from both variables underpin that Orviglance significantly improves MRI performance.
1 The above mentioned results stem from of a blinded-read study, which comprised all imaging data including Phase 1 and Phase 2 data. The blinded-read results have been presented at major radiology conferences
■ Other markets, e.g., China ■ Annual growth of 4-5%
Imaging experts RadMD, NY
4 3 2
Clinics/ Hospitals
| US team |
Around 40 FTEs at launch |
|---|---|
| Clinics/ | Around 400 clinics and hospitals serve 75% of the target patient population1 |
Sources:
1: Ascelia Pharma market research with Decision Resources Group, 2020
2: Ascelia Pharma market research and analyses with Revenue Reimbursement Solutions and Charles River Associates, 2020
Oncoral is a novel daily irinotecan chemotherapy in development. Irinotecan chemotherapy has an established potent anti-tumor effect. Oncoral is a daily irinotecan tablet with the potential to offer better efficacy with improved safety following the daily dosing at home compared to intravenous high-dose infusions at the hospital.
The active pharmaceutical ingredient (API) in Oncoral is irinotecan, which has an established and proven effect in killing cancer cells. Irinotecan is so-called antineoplastic agent that after metabolic activation inhibits the enzyme topoisomerase 1, thereby inducing cancer cell death via the prevention of their DNA replication. Irinotecan is converted by carboxylesterases, primarily in the liver, to the active metabolite SN-38 which is 100–1,000 more potent than irinotecan in killing tumor cells.
Oncoral is a new patented oral tablet formulation of irinotecan. Oncoral enables a secure and efficient release and absorption of irinotecan from the gastro-intestinal tract after oral administration with a high conversion rate of irinotecan to the active metabolite SN-38, which has a high anti-tumor activity. Oncoral has the potential to be combined with other chemotherapies and targeted cancer drugs and enable an all oral chemo combination.
We remain committed to Oncoral. We still plan for a Phase 2 study of Oncoral. However, as our clinical development team is now fully focused on SPARKLE, we will start patient enrollment in study when we are able to do this without impacting SPARKLE.
Following an initial dose-finding part, the Phase 2 study will be a randomized controlled multicenter study. In the study, Oncoral will be added to LONSURF (trifluridine and tipiracil) film-coated tablets for oral use compared to LONSURF alone. The objectives of the planned Phase 2 study are several. First of all, to establish a clinical proof of concept in metastatic gastric cancer. There is a potential for Orphan Drug Designation in gastric cancer and also the clinical guidelines and clinical data support efficacy of irinotecan in gastric cancer. Then there is potential for subsequent label expansion into other solid tumor indications. Another objective is to generate, compelling Phase 2 data for further development and design a Phase 3 study.
| TYPE OF STUDY | Randomized controlled, multicentre, multinational study: Oncoral + LONSURF vs. LONSURF |
|---|---|
| ENDPOINTS | Primary: Progression Free Survival Secondary: Response rate, PK, Safety and Overall Survival data in a follow up analysis |
| NUMBER OF PATIENTS | Approximately 100 patients |
10 Ascelia Pharma Interim Report 9M 2022 (Jan-Sep 2022)
The Group's net sales in Q3 (Jul-Sep 2022) amounted to SEK 0 (SEK 0). Ascelia Pharma does not expect to recognize revenue before products have been launched on the market. Other operating income totaled SEK 352 thousand (SEK 67 thousand). The income refers to exchange rate gains.
R&D costs for the Group in Q3 were SEK 23.0 million (SEK 24.7 million). The cost decrease of SEK 1.7 million primarily reflects lower costs for Oncoral Phase 2 preparations in current quarter.
During Q3, costs related to commercial preparations for Orviglance amounted to SEK 3.2 million (SEK 4.1 million). This reflects further investments in market launch preparations.
Administration costs for the Group in Q3 amounted to SEK 3.7 million (SEK 4.1 million). The cost decrease in the current quarter compared with Q3-2021 primarily reflects a decrease in recognized costs for employee incentive programs.
The operating result in Q3 amounted to SEK -29.6 million (SEK -32.7 million). The decreased loss primarily reflects the reduced costs of incentive programs for employees.
The Group's net loss in Q3 amounted to SEK -26.0 million (SEK -28.5 million). In the current quarter, net financial income of SEK 3.5 million was recognized due to primarily strengthening of USD against SEK, which translated into an increase in the value of bank deposits (a significant part of bank deposit is held in USD to match upcoming cash outflow in this currency). The net loss corresponds to a loss per share, before and after dilution, of SEK -0.77(SEK -0.82).
Cash flow from operating activities before changes in working capital in Q3 amounted to SEK -30.8 million (SEK -31.3 million). The outflow when compared to the same quarter previous year are at the same level. This reflects the continuously high levels of R&D activities and commercial preparations in current quarter. Changes in working capital in the current quarter totaled an outflow of SEK -1.7 million (inflow of SEK 0.5 million). The outflow in the current quarter primarily reflects the decrease in accounts payable and other liabilities.
Cash flow from investing activities in Q3 totaled to SEK -1 thousand (SEK 0 thousand). Cash flow from financing activities amounted to an outflow of SEK -0.3 million (outflow of SEK -0.3 million).
On the closing date, equity amounted to SEK 230.3 million, compared with SEK 307.8 million per 31 December 2021 and SEK 341.3 million per 30 September 2021. The decrease since 31 December 2021 and 30 September 2021 reflects the net losses incurred.
Liquid assets on the closing date amounted to SEK 179.8 million, compared to SEK 261.6 million per 31 December 2021 and SEK 291.0 million per 30 September 2021. The decrease since 31 December 2021 and 30 September 2021 reflects the net losses incurred.
| Financials key ratios for the Group | Q3 (July-September) | |
|---|---|---|
| 2022 | 2021 | |
| Operating result (SEK 000') | -29,619 | -32,736 |
| Net result (SEK 000') | -25,959 | -28,521 |
| Earnings per share (SEK) | -0.77 | -0.82 |
| Weighted avg. number of shares | 33,668,262 | 34,576,448 |
| R&D costs/operating costs (%) | 77% | 75% |
| Cash flow used in operating activities (SEK 000') | -32,492 | -30,729 |
| Equity (SEK 000') | 230,295 | 341,251 |
| Liquid assets incl. marketable securities (SEK 000') | 179,811 | 291,029 |
The Group's net sales in 9M (Jan-Sep 2022) amounted to SEK 0 (SEK 0). Ascelia Pharma does not expect to recognize revenue before products have been launched on the market. Other operating income totaled SEK 747 thousand (SEK 194 thousand). The income refers to exchange rate gains.
R&D costs for the Group in 9M were SEK 74.4 million (SEK 79.7 million). The cost decrease of SEK 5.3 million primarily reflects timing of milestone payments for Orviglance Phase 3 study, which caused higher cost recognition in first quarter last year compared to the first quarter this year.
During 9M, costs related to commercial preparations for Orviglance amounted to SEK 11.1 million (SEK 7.1 million). The cost increase compared with 9M 2021 reflects a step-up in market launch preparations.
Administration costs for the Group in 9M amounted to SEK 9.9 million (SEK 11.8 million). The cost decrease primarily reflects a decrease in recognized costs for employee incentive programs.
The operating result in 9M amounted to SEK -94.8 million (SEK -98.8 million). The reduced loss reflects the timing effect with lower R&D costs in Q1-2022, which was partly counterbalanced by higher commercial preparation costs.
The Group's net loss in 9M amounted to SEK -77.8 million (SEK -90.8 million). In the current period, net financial income of SEK 14.9 million was recognized due to primarily strengthening of USD against SEK, which translated into an increase in the value of bank deposits (a significant part of bank deposit is held in USD to match upcoming cash outflow in this currency). The net loss corresponds to a loss per share, before and after dilution, of SEK -2.25 (SEK -2.80).
Cash flow from operating activities before changes in working capital in 9M amounted to SEK -96.5 million (SEK -94.5 million). The increased outflow y/y primarily reflects the higher level of commercial preparation in the current period. Changes in working capital in the current quarter totaled an outflow of SEK -16 thousand (inflow of SEK 10.2 million). The outflow in the current period primarily reflects the decrease in accounts payable.
Cash flow from investing activities in 9M totaled an outflow of SEK -65 thousand (SEK -38 thousand), which reflects a value loss indivestment of a leasing car. Cash flow from financing activities amounted to an outflow of SEK -0.9 million (inflow of SEK 185.1 million), which mainly reflects amortization of lease liabilities.
On the closing date, equity amounted to SEK 230.3 million, compared with SEK 307.8 million per 31 December 2021 and SEK 341.3 million per 30 September 2021. The decrease since 31 December 2021 and 30 September 2021 reflects the net losses incurred.
Liquid assets on the closing date amounted to SEK 179.8 million, compared to SEK 261.6 million per 31 December 2021 and SEK 291.0 million per 30 September 2021. The decrease since 31 December 2021 and 30 September 2021 reflects the net losses incurred.
| Financials key ratios for the Group | 9M (January-September) | |
|---|---|---|
| 2022 | 2021 | |
| Operating result (SEK 000') | -94,840 | -98,788 |
| Net result (SEK 000') | -77,841 | -90,830 |
| Earnings per share (SEK) | -2.25 | -2.80 |
| Weighted avg. number of shares | 34,576,448 | 32,412,069 |
| R&D costs/operating costs (%) | 78% | 80% |
| Cash flow used in operating activities (SEK 000') | -96,549 | -84,313 |
| Equity (SEK 000') | 230,295 | 341,251 |
| Liquid assets incl. marketable securities (SEK 000') | 179,811 | 291,029 |
Ascelia Pharma has one outstanding employee option program as well as share saving programs. If the terms of the option program are met at the time for utilization, the management team has the right to purchase shares at a pre-determined price. For the share-saving program, employees are entitled to receive matching and performance shares according to terms of the program.
The Group recognizes share-based remuneration, which personnel may receive. A personnel cost is recognized, together with a corresponding increase in equity, distributed over the vesting period. Social security costs are revalued at fair value. Further information about the incentive programs can be found in the Annual Report 2021 on pages 67-68.
In case all outstanding incentive programs per 30 September 2022 (incl. a new share-saving program approved by the AGM in May 2022) are exercised in full, a total of 2.2 million common shares will be issued (including hedge for future payment of social security charges). This corresponds to an aggregate maximum dilution of approximately 6.2% of Ascelia Pharma's share capital after full dilution (calculated on the number of common shares that will be added upon full exercise of all incentive programs).
Ascelia Pharma's activities and markets are exposed to a number of risks and uncertainties which impact, or could impact, the company's business, financial position and result. The risks and uncertainties, which Ascelia Pharma considers to have the largest impact on its results are clinical drug development, regulatory conditions, commercialization and licensing, intellectual property rights and other forms of protection, financing conditions, macroeconomic conditions including impact from pandemics, geopolitical effects, inflation and foreign exchange exposure.
The Group's overall strategy for risk management is to limit undesirable impact on its result and financial position, to the extent it is possible. The Group's risks and uncertainties are described in more detail in the Annual Report 2021 on pages 34-36.
On 5 October 2022, it was annonced that Ascelia Pharma expands its leadership team to seven members.
This interim report has not been reviewed by the company´s auditor.
This interim report has been prepared in both Swedish and English versions. In the event of any differences between the translations and the Swedish original, the Swedish version shall prevail.
Malmö, 4 November 2022 Ascelia Pharma AB (publ)
CEO
| Q3 (Jul-Sep) | 9M (Jan-Sep) | |||
|---|---|---|---|---|
| SEK in thousands (unless otherwise stated)* | 2022 | 2021 | 2022 | 2021 |
| Net sales | – | – | – | – |
| Gross profit/loss | – | – | – | – |
| Administrative costs | -3,736 | -4,050 | -9,868 | -11,794 |
| Research and development costs | -22,993 | -24,686 | -74,439 | -79,674 |
| Commercial preparation costs | -3,233 | -4,066 | -11,149 | -7,146 |
| Other operating income | 352 | 67 | 747 | 194 |
| Other operating costs | -9 | -1 | -131 | -368 |
| Operating result | -29,619 | -32,736 | -94,840 | -98,788 |
| Finance income | 3,572 | 2,946 | 14,992 | 7,388 |
| Finance costs | -43 | -27 | -69 | -1,990 |
| Net financial items | 3,529 | 2,919 | 14,923 | 5,398 |
| Loss before tax | -26,090 | -29,817 | -79,917 | -93,390 |
| Tax | 131 | 1,296 | 2,076 | 2,560 |
| Loss for the period | -25,959 | -28,521 | -77,841 | -90,830 |
| Attributable to: | ||||
| Owners of the Parent Company | -25,959 | -28,521 | -77,841 | -90,830 |
| Non-controlling interest | – | – | – | – |
| Earnings per share | ||||
| Before and after dilution (SEK) | -0.77 | -0.82 | -2.25 | -2.80 |
| Q3 (Jul-Sep) | 9M (Jan-Sep) | |||
|---|---|---|---|---|
| SEK in thousands (unless otherwise stated)* | 2022 | 2021 | 2022 | 2021 |
| Profit/loss for the period | -25,959 | -28,521 | -77,841 | -90,830 |
| Other comprehensive income | ||||
| Currency translation of subsidiaries** | 124 | 61 | 381 | 69 |
| Other comprehensive income for the period | 124 | 61 | 381 | 69 |
| Total comprehensive income for the period | -25,835 | -28,460 | -77,460 | -90,761 |
* Some figures are rounded, so amounts might not always appear to match when added up.
** Will be classified to profit and loss when specific conditions are met
| 30 Sep | 30 Sep | 31 Dec | |
|---|---|---|---|
| SEK in thousands* | 2022 | 2021 | 2021 |
| ASSETS | |||
| Non-current assets | |||
| Intangible assets | 57,072 | 57,063 | 57,063 |
| Tangible assets - Equipment | 182 | 256 | 238 |
| Right-of-use assets | 688 | 1,851 | 1,581 |
| Total non-current assets | 57,942 | 59,170 | 58,882 |
| Current assets | |||
| Advance payments to suppliers | 5,131 | 7,419 | 6,175 |
| Current receivables | |||
| Income tax receivables | 7,436 | 4,878 | 4,395 |
| Receivables from shareholders | – | – | – |
| Other receivables | 1,369 | 1,706 | 1,165 |
| Prepaid expenses and accrued income | 2,402 | 842 | 1,277 |
| Cash and bank balances | 179,811 | 291,029 | 261,599 |
| Total current assets | 196,148 | 305,874 | 274,611 |
| Total assets | 254,090 | 365,044 | 333,493 |
| EQUITY | |||
| Share capital | 34,871 | 34,576 | 34,576 |
| Other paid-in capital | 678,747 | 678,831 | 678,831 |
| Reserve of exchange differences on translation | 381 | 188 | 254 |
| Loss brought forward (incl. net profit/loss for the period) | -483,705 | -372,344 | -405,827 |
| Equity attributable to Parent Company shareholders | 230,295 | 341,251 | 307,834 |
| Total equity | 230,295 | 341,251 | 307,834 |
| LIABILITIES | |||
| Long-term liabilities | |||
| Leasing | 240 | 822 | 553 |
| Total long-term liabilities | 240 | 822 | 553 |
| Current liabilities | |||
| Accounts payable | 3,858 | 8,264 | 6,147 |
| Tax payable | – | – | 5 |
| Other liabilities | 2,448 | 1,406 | 1,509 |
| Current lease liabilities | 483 | 1,106 | 1,102 |
| Accrued expenses and deferred income | 16,767 | 12,195 | 16,343 |
| Total current liabilities | 23,556 | 22,971 | 25,106 |
| Total liabilities | 23,796 | 23,793 | 25,659 |
| Total equity and liabilities | 254,090 | 365,044 | 333,493 |
* Some figures are rounded, so amounts might not always appear to match when added up.
15 Ascelia Pharma Interim Report 9M 2022 (Jan-Sep 2022)
| 9M (Jan-Sep) | FY (Jan-Dec) | ||
|---|---|---|---|
| SEK in thousands* | 2022 | 2021 | 2021 |
| Equity at start of the period | 307,834 | 236,056 | 236,056 |
| Comprehensive income | |||
| Profit/loss for the period | -77,841 | -90,830 | -125,903 |
| Other comprehensive income | 381 | 69 | 135 |
| Total comprehensive income | -77,460 | -90,761 | -125,768 |
| Transactions with shareholders | |||
| New issue of C-shares | 295 | 398 | 397 |
| Repurchase of own shares C-shares | -295 | -398 | -397 |
| New issue of common shares | – | 200,000 | 200,000 |
| Issuance expenses | -84 | -13,271 | -13,271 |
| Redemption of warrants | – | 3,852 | 3,853 |
| Share based remuneration to employees | 5 | 3,545 | 6,964 |
| Total transactions with shareholders | -79 | 194,127 | 197,546 |
| Equity at end of the period | 230,295 | 339,422 | 307,834 |
| Q3 (Jul-Sep) | 9M (Jan-Sep) | |||
|---|---|---|---|---|
| SEK in thousands* | 2022 | 2021 | 2022 | 2021 |
| Operating activities | ||||
| Operating result | -29,619 | -32,736 | -94,840 | -98,788 |
| Expensed share based remuneration | -1,247 | 1,398 | -1,867 | 4,129 |
| Adjustment for items not included in cash flow | 253 | 286 | 853 | 724 |
| Interest received | 5 | – | 5 | – |
| Interest paid | -12 | -22 | -38 | -58 |
| Income tax paid/received | -207 | -200 | -644 | -539 |
| Cash flow from operating activities before changes in working capital | -30,829 | -31,274 | -96,533 | -94,532 |
| Cash flow from changes in working capital | ||||
| Increase (-)/Decrease (+) of advance payments | 550 | -1,883 | 1,069 | 870 |
| Increase (-)/Decrease (+) of operating receivables | -642 | -220 | -1,987 | -981 |
| Increase (+)/Decrease (-) of accounts payable | -5,041 | -822 | -2,323 | 4,377 |
| Increase (+)/Decrease (-) of other liabilities | 3,469 | 3,470 | 3,224 | 5,953 |
| Change in working capital | -1,663 | 545 | -16 | 10,219 |
| Cash flow used in operating activities | -32,492 | -30,729 | -96,549 | -84,313 |
| Investing activities | ||||
| Investment in equipment | – | – | – | -38 |
| Divestment of right-of-use assets | -1 | – | -65 | – |
| Cash flow from investing activities | 1 | 0 | -65 | -38 |
| Financing activities | ||||
| Issuance proceeds | – | – | – | 200,000 |
| Issuance costs | – | – | -84 | -13,271 |
| Redemption of warrants net | – | – | – | -914 |
| Amortisation of loan (leasing) | -250 | -271 | -777 | -671 |
| Cash flow from financing activities | -250 | -271 | -861 | 185,144 |
| Cash flow for the period | -32,742 | -31,000 | -97,474 | 100,793 |
| Cash flow for the period | -32,742 | -31,000 | -97,474 | 100,793 |
| Cash and cash equivalents at start of period | 208,861 | 319,014 | 261,599 | 184,686 |
| Exchange rate differences in cash and cash equivalents | 3,692 | 3,015 | 15,686 | 5,550 |
| Cash and cash equivalents at end of period | 179,811 | 291,029 | 179,811 | 291,029 |
| Q3 (Jul-Sep) | 9M (Jan-Sep) | |||
|---|---|---|---|---|
| SEK in thousands* | 2022 | 2021 | 2022 | 2021 |
| Net sales | 60 | 1,817 | 1,050 | 4,298 |
| Gross profit/loss | 60 | 1,817 | 1,050 | 4,298 |
| Administrative costs | -3,687 | -3,996 | -9,711 | -11,712 |
| Research and development costs | -20,794 | -19,544 | -64,268 | -70,487 |
| Commercial preparation costs | -3,218 | -4,073 | -11,149 | -7,162 |
| Other operating income | – | 36 | 57 | 136 |
| Other operating costs | -9 | – | -131 | -344 |
| Operating result | -27,648 | -25,760 | -84,152 | -85,271 |
| Finance income | 3,171 | 2,657 | 13,930 | 7,099 |
| Finance costs | -69 | -6 | -69 | -1,936 |
| Result from other long-term receivables | 730 | 393 | 1,188 | 1,181 |
| Net financial costs | 3,832 | 3,044 | 15,049 | 6,344 |
| Loss before tax | -23,816 | -22,716 | -69,103 | -78,927 |
| Group contribution | – | – | – | – |
| Tax | – | – | – | – |
| Loss for the period | -23,816 | -22,716 | -69,103 | -78,927 |
| Q3 (Jul-Sep) | 9M (Jan-Sep) | |||
|---|---|---|---|---|
| SEK in thousands* | 2022 | 2021 | 2022 | 2021 |
| Loss for the period | -23,816 | -22,716 | -69,103 | -78,927 |
| Other comprehensive income | – | – | – | – |
| Other comprehensive income for the period | – | – | – | – |
| Total comprehensive income for the period | -23,816 | -22,716 | -69,103 | -78,927 |
| 30 Sep | 30 Sep | 31 Dec | |
|---|---|---|---|
| SEK in thousands* | 2022 | 2021 | 2021 |
| ASSETS | |||
| Non-current assets | |||
| Tangible assets | |||
| Equipment | 182 | 256 | 238 |
| Financial assets | |||
| Shares in affiliated companies | 58,068 | 58,068 | 58,068 |
| Other long-term receivables from group companies | 37,983 | 32,566 | 36,620 |
| Total non-current assets | 96,233 | 90,890 | 94,926 |
| Current assets | |||
| Advance payments to suppliers | 5,131 | 5,476 | 5,323 |
| Current receivables | |||
| Receivables from group companies | 8,000 | 5,740 | 6,971 |
| Income tax receivables | 1,375 | 1,161 | 739 |
| Other receivables | 1,315 | 1,596 | 656 |
| Prepaid expenses and accrued income | 2,303 | 842 | 1,183 |
| Cash and bank balances | 171,730 | 276,959 | 246,311 |
| Total current assets | 189,854 | 291,774 | 261,183 |
| Total assets | 286,087 | 382,664 | 356,109 |
| EQUITY | |||
| Restricted equity | |||
| Share capital | 34,871 | 34,576 | 34,576 |
| Non-restricted equity | |||
| Other paid-in capital | 678,747 | 678,831 | 678,831 |
| Loss brought forward | -380,875 | -272,884 | -271,295 |
| Loss for the period | -69,142 | -78,927 | -109,288 |
| Total equity | 263,601 | 361,596 | 332,824 |
| LIABILITIES | |||
| Current liabilities | |||
| Accounts payable | 3,296 | 7,938 | 5,700 |
| Other liabilities | 2,448 | 1,406 | 1,509 |
| Accrued expenses and deferred income | 16,742 | 11,724 | 16,076 |
| Total current liabilities | 22,486 | 21,068 | 23,285 |
| Total equity and liabilities | 286,087 | 382,664 | 356,109 |
This interim report for the Group has been prepared according to IAS 34 Interim Financial Reporting and applicable rules in the Swedish Annual Accounts Act (ÅRL). The interim report for the parent company has been prepared according to the Swedish Annual Accounts Act chapter 9, Interim Reporting. For the Group and the parent company, the same accounting principles and basis for calculations have been applied as in the recent Annual Report.
The recognized value for other receivables, cash and cash equivalents, trade payables and other liabilities constitutes a reasonable approximation of fair value.
Oncoral Pharma ApS has an agreement with Solural Pharma ApS according to which, Solural Pharma ApS provides development and manufacturing of clinical study material. The owners of Solural Pharma ApS are the founders of Oncoral Pharma ApS and are, after the sale of Oncoral Pharma ApS to Ascelia Pharma AB in 2017, shareholders in Ascelia Pharma AB. Per 30 September 2022, the owners of Solural ApS collectively owned 1.9% of the shares in Ascelia Pharma AB. In addition to payment for services performed, Solural Pharma ApS has the right to receive a bonus of maximum SEK 10 million if commercialization occurs through a sale or a outlicensing and SEK 12 million if commercialization is carried out by Oncoral Pharma ApS or Ascelia Pharma AB itself.
Regardless the commercialization method, Oncoral Pharma ApS has the right to, at any time, finally settle Solural Pharma ApS right for remuneration by payment of SEK 10 million. In 9M 2022, services for a value of around SEK 483 thousand were acquired from Solural Pharma ApS.
Reference is made in this interim report to alternative performance measures that are not defined according to IFRS. Ascelia Pharma considers these performance measures to be an important complement since they enable a better evaluation of the company´s economic trends. The company believes that these alternative performance measures give a better understanding of the company´s financial development and that such key performance measures contain additional information to the investors to those performance measures already defined by IFRS. Furthermore, the key performance measures are widely used by the management in order to assess the financial development of the company. These financial key performance measures should not be viewed in isolation or be considered to substitute the key performance measures prepared by IFRS.
Furthermore, such key performance measures should not be compared to other key performance measures with similar names used by other companies. This is due to the fact that the above-mentioned key performance measures are not always defined identically by other companies. These alternative performance measures are described below.
The recognized research and development project in progress is subject for management's impairment test. The most critical assumption, subject to evaluation by management, is whether the recognized intangible asset will generate future economic benefits that at a minimum correspond to the intangible asset's carrying amount. Management's assessment is that the expected future cash flows will be sufficient to cover the intangible asset's carrying amount and accordingly no impairment loss has been recognized.
In 9M 2022, the criteria for classifying R&D costs as an asset according to IAS 38 has not been met (capitalization of development expenses is normally done in connection with final regulatory approval). Hence, all R&D costs related to the development of the product candidates have been expensed.
Ascelia Pharma has implemented two employee option programs with individual terms and conditions. The parameter, which have the largest impact on the value of the options, is the publicly traded share price.
In 2021, one program reached its exercise period and all options related to this program, 481,573 in total, were exercised into common shares.
For the outstanding option program, a gain of SEK 0.9 million including social security charges was recognized in 9M 2022. The gain primarily reflects the decline is Ascelia Pharma's share price during the period resulting in a lower liability for social security charges.
Ascelia Pharma has implemented four long-term incentive programs for employees in the form of performance-based share saving programs. The parameter, which have the largest impact on the value of the programs, is the publicly traded share price.
The total recognized costs for the share saving programs including social security charges in 9M 2022 were SEK 0.9 million.
| Alternative performance measures | Definition | Aim |
|---|---|---|
| Operating results (TSEK) | Profit before financial items and tax. | The performance measure shows the company´s operational performance. |
| Research and development costs/Operating costs (%) | The research and development expenses in relation to total operating costs (consisting of the sum of administrative expenses, R&D, costs for commercial prepara tions and other operating expenses). |
The performance measure is useful in order to understand how much of the operating costs that are related to research and development expenses. |
| Q3 (Jul-Sep) | 9M (Jan-Sep) | |||
|---|---|---|---|---|
| SEK in thousands* | 2022 | 2021 | 2022 | 2021 |
| R&D costs | -22,993 | -24,686 | -74,439 | -79,674 |
| Administration costs | -3,736 | -4,050 | -9,868 | -11,794 |
| Commercial preparation costs | -3,233 | -4,066 | -11,149 | -7,146 |
| Other operating costs | -9 | -1 | -131 | -368 |
| Total operating costs | -29,971 | -32,803 | -95,587 | -98,982 |
| R&D costs/Operating costs (%) | 77% | 75% | 78% | 80% |
ASCELIA PHARMA AB (publ) Hyllie Boulevard 34 SE-215 32 Malmö, Sweden
ascelia.com
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