Interim report 1 January – 30 September 2023
Interim report 1 January – 30 September 2023
Dialogue with the FDA intensifies
Third quarter: 1 July–30 September 2023
• Net sales amounted to SEK 3.0 million (2.9).
• The operating result totalled SEK -48.2 million (-58.5).
• The result for the period amounted to SEK -48.6 million (-59.0).
• Earnings per share before and after dilution amounted to SEK -0.56 (-2.02).
• Cash flow from operating activities totalled SEK -54.5 million (-53.7).
Period: 1 January–30 September 2023
• Net sales amounted to SEK 4.4 million (12.8).
• The operating result totalled SEK -175.1 million (-202.7).
• The result for the period amounted to SEK -175.1 million (-205.0).
• Earnings per share before and after dilution amounted to SEK -3.59 (-7.02).
• Cash flow from operating activities totalled SEK -180.3 million (-171.2).
• As of 30 September 2023, the Company had a total of SEK 134.9 million (72.9) in available funds and short-term investments with terms of less than three months.
In the third quarter of 2023
• Q-linea AB held an extraordinary general meeting at which the Board’s proposal regarding a new share issue with preferential rights for existing shareholders was approved. Prospectus was published as well as the outcome the rights issue, which raised approximately SEK 263 million for Q-linea AB before transaction costs. The number of shares and votes increased by a total of 87,628,425.
• The Company strengthened its commercial teams in Europe and the US through the appointment of Franco Pellegrini as Sales Director for Southern Europe and Jim Kathrein as VP US Commercial Operations.
• Q-linea AB completed its 510(k) application for US market approval.
• Q-linea AB received two orders for ASTar instruments and consumables from Eurobio Scientific in France.
• Jonas Jarvius announced that he plans to step down as CEO before summer 2024. Three of the largest shareholders in Q-linea (69% of shares) informed the Board that they intend to support the nomination of Jonas Jarvius as a new director in 2024.
After the end of the period
• The Company presented the results of the first commercial evaluation of ASTar in the UK at the IBMS congress in Birmingham and strengthened its presence in Finland and the Baltics through a contract with Labema Oy.
During the third quarter of the year, we carried out several activities to prepare for the market. At the time of writing, I have just returned home from an intense period of travel to prepare Q-linea for a US launch. This included activities to secure logistics chains, deciding on the location of our US head office and compiling candidates for early access. As soon as ASTar is approved, we want to allow hospitals and hospital chains to test the system. We now have a good list of early access customers that we plan to go ahead with as part of our pre-launch activities.
During the quarter, I also met with several major potential strategic partners. In short, the dialogue concerning potential future partnerships is going well. Our focus is on the US market, but major strategic partnerships could also include other regions.
The positive results of a commercial evaluation of ASTar in the UK were presented at the IBMS congress in Birmingham after the end of the quarter. The study investigated ASTar’s performance in a real environment and showed that ASTar not only supported optimisation of treatment for most patients, but also prevented a major outbreak of multidrug-resistant bacteria at the hospital. It is very encouraging to see this type of result, which shows that ASTar performs as expected in a real environment – especially considering that many hospitals have been under significant pressure during and after the pandemic and need tools and systems that provide patient value. It is my firm conviction that rapid susceptibility testing will eventually be implemented in all hospitals that carry out blood culture analyses.
During the quarter, we received two orders for ASTar in France from our French partner Eurobio Scientific. Eurobio Scientific is in active discussions with several potential customers in France and therefore decided in September to purchase a second instrument to support these activities, which bodes well for 2024. France has a widespread problem with antibiotic resistance, and we have immense confidence in Eurobio Scientific, which has a motivated team and a large installed base of more than 500 diagnostic instruments at its customers’ laboratories.
Per the FDA’s recommendation, we completed our 510(k) application for US market approval during the quarter, adding the results from supplementary analytical and clinical studies. The continuous dialogue that we have had with the FDA was likely helped by ASTar’s designation as a breakthrough device. The dialogue intensified during the quarter and our assessment is that the process is moving in a positive direction, but it is difficult to estimate how long it will take.
As we await US market approval, we are working on strengthening our commercial presence in the US, and in the beginning of the quarter we hired a Chief Commercial Officer, Jim Kathrein, to lead the local organisation and build up our commercial team in the US. We also carried out similar measures for the commercial team in Europe through the appointment of Franco Pellegrini as Sales Director for Southern Europe. Franco most recently worked at Thermo Fisher Scientific. It is incredibly gratifying to see that people in such senior roles want to come to Q-linea to work with ASTar. They are joining us because they see that ASTar can drastically change treatment and results for critically ill patients.
As I announced previously, in 2024 I will be stepping down as CEO to take over as CEO for a US-based life sciences company. It has truly been a privilege to work for Q-linea for over 15 years and I am pleased and honoured that the major owners would like me to continue to contribute to Q-linea’s development as a director. I am proud over what we have accomplished so far. We have built a strong commercial foundation and I hope to see ASTar in the US market before I leave. I look forward to seeing all of the good things Q-linea will accomplish for patients with serious infections and would like to take the opportunity to thank you for your confidence in the new share issue that raised SEK 263 million before issue costs.
Overall, the commercial initiative is proceeding according to plan. We dedicated 2023 to preparing for the market, with work and studies that laid the foundation for next year. We still believe that we will see commercial orders during the fourth quarter and expect a distinctly positive sales trend in 2024.
Uppsala, 1 November 2023, Jonas Jarvius, President
This report has been reviewed by the auditor of the Company. The report has been prepared in a Swedish original and an English translation. In the event of any discrepancies between the two, the Swedish version is to apply.
Q-linea invites investors, analysts and the media to an audiocast and teleconference (in English) today, 2 November, at 1:00 to 2:00 p.m. (CET). President Jonas Jarvius and CFO Christer Samuelsson will present Q-linea, comment on the interim report for the January to September 2023 period and respond to questions.
To participate via webcast, please visit the following link: https://ir.financialhearings.com/q-linea-q3-2023
There will be an opportunity to ask questions in writing at the webcast.
If you would like to ask questions verbally via conference call, please register at the following link:
You will receive a telephone number and a meeting ID to log into the conference call after registering. There will be an opportunity to ask questions verbally during the conference call.