Okay. Hey, welcome everyone to Modulight's Q3 webinar. My name is Seppo Orsila. I'm a founder and CEO of the company, and with me, I have our CFO, Mrs. Anca Guina. First, we will kind of walk you through about the agenda and tell us a little bit about what we a re doing as a company to fight cancer. There are actually quite a few things beside the normal operational things that we are sharing today as have been covered already in our release. Towards the end of this presentation, we hope to bring more in-depth insights into the things that we are doing here today, yesterday, and tomorrow. As usual, we will start with the Q3 summary. We will give an update on our U.S. launch, discuss a little bit of the fundamental technology of our cloud and our platform. Anca will walk through the financial highlights. Then I will continue more about the pipeline and progress there, discuss the customer base and events in a usual manner. Take a reminder about the revenue model, and there also touch upon the kind of economic modeling that we have been doing extensively for about a year, and shared already preliminary insights to that during the last quarter webinar, but now we will be able to give much more detail. Modulight is still not issuing outlook as the company is at the early phase, but we'll give a reminder of that before summarizing. Obviously, we're happy to then answer all the questions that you might have. In Q3, obviously, we are not satisfied with the progress that we made, and there were delays related to the implementation of our business model pay-per-treatment, as well as customer projects. As I will outline later in the presentation, the delays were primarily related to operational things of customers' other activities and not directly related to us. This does not make us satisfied about the progress in Q3, but we also want to be clear that we progressed in all of our activities across the entire pipeline. We particularly worked on our SaaS business model and related customer audits. Many of the healthcare providers, including some very significant hospitals and insurance companies in the United States, are now at advanced stages doing the related kind of information security audits that are required always before deploying the products into use. We also have been doing activities to improve our productivity, and these are mostly related to applying our new technology and our new capabilities for the benefit of future productivity, and we have been seeing some first signs of those. We expect more to be visible also on the top-line numbers next year. Our EBITDA was EUR -2.2 million, and we continue with R&D pipeline at the same number of projects as last quarter. In all the projects, there was some progress, but not as much as we expected. We view that the commercial potential in the project is at least as high as we have estimated earlier. The EBITDA is obviously low because of our investment into the activities and our continued investment into the new technologies and platforms that we are developing. One quite significant progress step that we had over the quarter was that one of our U.S. publicly listed companies reached a phase III clinical trial. This is significant to us because they are a customer who have been working with our product since the very first phases, even from the preclinical phases, now close to 10 years. Also, later on, we'll share more details about this. Finally, on the brief, we listed our science publication, and we're gonna talk more about that and its relevance in the coming slides. First, about the U.S. launch update. As you know, we received PMA approval from U.S. FDA in January. PMA approval is the highest class of approval you can receive from FDA. As far as we know, it's only us and one Turku-based large company who have a PMA approval in Finland. Our approval, together with Bausch, is related to AMD, age-related macular degeneration. The project planning and deployment and go-to-market is progressing with our pharmaceutical partner. We continue to drive customer visits, and we are also happy to announce that we have hired a very senior person as a Sales Director of North America. That person will start at the beginning of January. Customer information security audits have been at the core of our activity with the customers, and this is something that all the hospitals and insurance companies require for us to connect to their back end and them to treat patients with our cloud. This has obviously been taking more time than we expected, but we are working concurrently with multiple of those and seeing good progress, even if not as fast as we were expecting. Project planning with the pharmaceutical partners are progressing, as I said earlier. A little bit about our technology. As I said in our summary, we have now used our technology and laser platform in a very unique way. It is used across multiple indications, across multiple drugs, and across multiple customers. Some of them are using the technology even in the competing fields with respect to their competitors. Meaning that two pharmaceutical companies are using unique proprietary technology from us concurrently. One thing that we feel that is a further great evidence of our platform's uniqueness and attractiveness is what we are reporting today. One of our customers, with whom we have been working since 2014, and started really from the preclinical phase, from the in vitro tests, has now progressed to phase III and is actively treating phase III patients. This trial will have more than 100 patients for an ultra-orphan indication. This can be considered a large population. What is quite significant here, that they have worked solely and exclusively from the beginning with our technology. They did try a competing technology, which is missing several of the things that we have. Competitor is not even having the cloud platform or the network connectivity, et cetera. To our understanding, they have abandoned that technology already years ago. What is also quite significant in our view is the fact that this customer, who we believe understands our technology, its strengths and weaknesses, has chosen to continue with us for now almost 10 years and shows even more expanding commitment to work with us. What is quite concrete is that during the past few years, including this year, they have started completely new clinical trials to other indications with us, and this we regard as a great recognition for our platform device. Same technology is being used by several other pharmaceutical companies, including their competitors. More to the technology. Last month, we published together with University of Maryland, a very prestigious science group, many details about our platform device in a Science Advances journal. Science is considered by many as the world's top-notch scientific article. Modulight's devices and technology is already covered multiple times in Nature, which is the other leading scientific journal in the world. This article in Science Advances validates many of the key arguments that we discussed also prior to the initial public offering. Essentially, all of these have been validated in published literature already. What is significant here that a Science type of magazine very rarely, if ever, to our knowledge, they have never published anything on a certain company's product, whereas our product is even in the headline of the paper. This is a said joint work with us and the University of Maryland. Our name and people are not just mentioned in the article, but are co-authors of the paper. We encourage everyone who is interested in our technology to take a look at this article. Some of the key things from the business point of view, what this means, are two. One is the ability to use the platform for treating patients and the novel approaches and techniques that our platform offers, and those are discussed in the article. What we have not been discussing that much, but was also part of the IPO prospectus, was prolonging the drug lifespan. Pharmaceutical companies are investing about 20%-30% of their R&D budget to so-called life cycle management activities. What this mean in practice are two things: You are expanding the use of your already existing approved drugs or pharmaceuticals. Expanding their lifetime. This is highly profitable for pharmaceutical companies. In general, these activities are viewed as lower risk, higher ROI, and shorter time to market, as you already have an approved drug, so the risk of a failure, which is very high in biotech industry, is significantly lower, as well as the time to market, as the drug is already approved, and you only need to show that it can be used for other indications. Thirdly, the market size can expand significantly. We have copied here a chart that was part of the company pre-IPO analysis about some of the very well-known examples of expanding the drug lifetime potential, and which, for example, in the case, can be sometimes even half or more. You should understand that the total costs during this life cycle management activities are reducing, whereas your potential is increasing. This is quite important. Thirdly, we want to highlight here, even if that is not the topic of this science paper, is that our collaboration with University of Maryland, including many, many other prestigious institutions, is continuing and is expected to expand. We will tell about the future steps with them and other leading institutions in the United States in the future, as we reach a concrete results. Just to mention that UMD was earlier awarded a contract by FDA, where Modulight device ML8500 is being used for quality assurance of photoactivated drugs and their research. This we view as also a very exciting step, even if it has not raised that much attention in the public media, but has been extensively covered in the scientific conferences by the leading experts in our field, not just from UMD, but also many other prestigious institutes around the world, and namely in the United States. Anca, please. Yes, for the period July-September this year, the revenue was 67% lower than in Q3 last year. As Seppo already mentioned earlier, some of the projects progressed slower than expected, so obviously, we had delays in revenue realization. EBITDA was decreasing by EUR 1.2 million from last year, mainly due to the decrease in the revenues by EUR 800,000 and also continued investments in developing our operations. EBIT was -EUR 3.07 million compared to -EUR 1.8 million in Q3 last year. As for the first three quarters of the year, the revenue amounted to EUR 3 million compared to EUR 3.3 million last year. The change of EUR -9.8 million is due to delays with the project in commercialization phase. As an example, we can say that the audits performed on information security process by our customers relate the pay-per-treatment-based projects. EBITDA amounted to EUR -5.5 million while a year ago, the corresponding figure was EUR -3.9 million. EBIT was EUR -7.07 million versus EUR -5.3 million in 2002. The costs increased due to investment in developing of our operations, which is shown, for example, in the increased number of the personnel, installations of and process validations of new product production equipment, which we discussed many times before. As mentioned earlier, the profitability was burdened by the planned investments in developing and growing the company's operations. The acquisition of fixed assets and intangible assets decreased by EUR 1.6 million in Q3 this year, compared to same period last year. Free cash from operating activities improved from last year. Cash at the end of the period was EUR 28 million, and the full equivalent time headcount was 70. Yeah. Thank you, Anca. The company's R&D pipeline remains at 27 projects. As said, all the projects progressed, even if not as we earlier expected. It's quite important to note that the potential in the short term and next year is viewed to be significant. We filed more inventions and have identified more things to add to our IPR portfolio. What is quite important to understand, even if it's not visible in this chart, is that in number of projects, a significant technical work, as well as quality and regulatory work, was conducted. This, unfortunately, is not yet visible in the numbers, but we are quite pleased in some areas of the technical work, even if we are obviously not at all satisfied with our overall performance. Our customer base continues to be flat, and the revenue base has been gearing towards larger companies, larger, more mature companies, and publicly listed companies over this year and last year. This is something that is in accordance to our strategy to piggyback large companies and their existing commercial muscle and vehicles. Thus, the revenue figures are now unsatisfactorily low, but most of the work now is carried over with large companies, which is quite important to us also on the future. [Garbled text/Artifacts]-> 250. *Wait, "29":* "twenty-nine" -> 29. *Wait, "July":* "July". *Wait, "Tampere":* "Tampere". *Wait, "Harvard":* "Harvard". *Wait, "University of Texas":* "University of Texas". *Wait, "photodynamic therapy":* "photodynamic therapy". *Wait, "photoimmunotherapy":* "photoimmunotherapy". *Wait, "IPA":* "IPA". *Wait, "long-term":* "long-term". *Wait, "quarter release":* "quarter release". *Wait, "IPA conference":* There were a number of parallel sessions and invited talks, and our devices were praised and presented in a special workshop, especially the future researchers and doctors. This was quite unique, as it has never been before allowed for a company to organize this high-grade scientific conference. Just a recap on our revenue model. As our projects mature and as we make progress in our pipeline, we expect predictability of the revenue to improve. As is shown by the Q3, the predictability is still very low, and this is not satisfactory to us, and we work very hard to change that. Now some of the projects, as reported also last time, are progressing towards more mature state. We were not aware of some of the things that hindered the progress on the customer side. I want to emphasize, however, that those delays were mostly not related to us, our product, or project with us, but due to their other operational activities. Those companies remain committed to those projects, as far as we understand, and their future looks solid. Pay-per-treatment is obviously the key enablement or key differentiator that our platform can offer. We have patented the remote-controlled medical device twice in the United States, and we continue convergence to the SaaS-based business model. As reported last time, the initial costs for per patient treatment are ranging roughly from EUR 1 thousand-EUR 10 thousand, but can be even more. This typically represents a cost of 1%-10% of the total cancer treatment cost, sometimes even significantly less, and I would say that the average is very much geared towards the lower end of the cost range. We are currently developing information security processes, or I should rather say, doing validation and audits with several customers, which are both hospitals, as well as insurance companies in the United States. This is a normal practice when you are taking a medical device, and especially a cloud-based product, in use in hospitals. So far, all the technical feedback is good, and some customers have also been urging their quality assurance and IT security people to hasten the projects, but this is obviously taking more time than we expected. We will give updates on the development of this activity as we progress and make material progress. Implementation of the pricing model is expected to have a financial visible impact in the short term, basically meaning next year. Some summary of the U.S. healthcare market economics related to some of the indications that we are working with. I want to emphasize that this study that we have been conducting in multiple phases with the help of KPMG strategy consultants now covers 11 indications in oncology and ophthalmology. Our laser is being actively used in more by several customers, but these are some of the studies that we have conducted so far and are able to summarize. The reason we have not covered all of them yet is that it takes quite a lot of time to go into the detail. This means interviewing key opinion leaders, interviewing key physicians, analyzing the data from multiple sources, et cetera. This is based on, I would say, a rather extensive work, and it's also quite costly. As a kind of highlight, the current scope, we conclude, co ntains many of the significant diseases, but not all which we cover. 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In summary, our focus has been on building the SaaS business model, working with the customers, namely insurance companies and hospitals, to start the deployment and proper level of treatment with the FDA-approved laser, as well as worked on improving productivity. A sizable portion of our spending is still going into R&D. While there is no significant financial outcome, we feel that most of the spending has been well spent in technology and products and our platforms. Our revenue was at disappointing level of EUR 1,406 thousand, and this was mostly due to delay in the projects and the PPT model implementation. EBITDA, as Anca discussed, was -EUR 2.2 million, and mostly impacted by the fact that we have been accelerating the deployment of our investments and taking more out of them, as explained and discussed earlier. Our operating costs have been higher, but we expect the lower cost base to be visible next year, based on the fact that this ramp-up of the investments and taking use of the new processes is starting to be complete. We are already seeing many technical results, which have been achieved after certain quite basic process development was done and is not expected to be needed to be repeated in future. R&D pipeline remained at a solid 27 project, and some are close to commercialization, but as said, progressed slower than we expected earlier. Potential of Modulight's technology has been reconfirmed through multiple ways, and we shared today example about customer progressing to phase III. Same customer deploying our technology after using it almost 10 years in new projects. Also, some starting early this year, even if those are completely independent. There was scientific evidence at the world's leading scientific publication and obviously the kind of all the peer reviews and commitments from customers is supporting this fact. We continue to develop our service-based business model and pay-per-treatment to drive the treatment-based pricing model. We will focus on implementing actions in line with our strategy and continue to reiterate those targets and resume to strong growth and profitability, as discussed earlier. Thank you very much. We are very happy to take any questions that you might have, and perhaps as customary, we start with the analysts on the line. Yes, we have our analysts for online. Lars Herrem from Danske, Kimmo Stenvall from OP, and Antti Siltanen from Inderes. Kimmo, do you wanna go first as you were first on the line? Yes, we can do that if that's okay. Couple of questions. First, on the CapEx side, I think you have mentioned that the CapEx should come down in later part of the year. It's still EUR 2 million in Q3. Of course, it is little bit down, but what kind of levels do we expect for the full year and maybe on 2024 also? That would be my first question. We cannot give guidance for the year-end CapEx investment. We mentioned that we basically finalized our investment plan already last year, but obviously some of the orders were delivered this year, and there are not many installations left to be done and many deliveries of the equipment. Basically, for the next year, we don't expect to have heavy investments in CapEx, so that will definitely be much lower. Maybe we can take this other way, that, as far as I recall, and this is not fully exact, but I would say that I would remember if we were expecting still some very significant new equipment. I'm not expecting to receive any significant new equipment this year or certainly early next year. We have not placed any long-term commitments to CapEx manufacturers even beyond that. Maybe that will at least partially answer the question without giving any guidance. Is this a question? * "Also little bit curious about to hear some thoughts on that, how many millions or what kind of figures we are talking about?" * Yes, it's a question. * Wait, "Then you said that the cost base will be lower next year." * Is this a question? * "Then you said that the cost base will be lower next year." * It's a statement o Yeah. Maybe Anca can give something on that, but my kind of thoughts are based on two things. Already pre-IPO, we explained that when you are buying new process equipment, which is the CapEx spending that we just discussed, then ramping up the process can easily take half a year or even more than a year. During that time, you are consuming very large amounts of expensive materials, such as substrates, metals, specialty gases, gold, platinum, all these kind of things. The total amount needed when you're using it for production or R&D purposes is significantly lower. Ramping up of these things has been largely done. Obviously, it will continue also in future, and we continue to develop new processes, but as we said already last winter, we expect that to start coming down, and we are already now seeing some of those effects. I discussed during the context of the pipeline some of the technical achievements that we have made, and those are direct results of the new processes that we have developed with heavy cost. Now, while unfortunately, they are not visible on the financial statements yet, we have created some new technologies, some new offerings, some new differentiation through use of this technology. In that sense, I'm able to say that we have, to partially at least, already confirmed this what we said last winter, that once we have done certain process development, then it can be used in multiple different technical developments. Anca, you have the more fact-based answer. Yeah, maybe one addition to this is that basically with acquiring all this equipment, we increased internal capabilities, so obviously, the outsourcing would decrease. Yeah, that's a good point, and I also would want to reiterate that while we continue hiring, it obviously increases cost levels. We will do some hiring also next year, but you should see much less kind of that during the next year. This is largely because we are now very much focusing on the productivity, and in our line of technology, which is very difficult, which is world-class technology. This kind of, let's say, onboarding new people is very costly. Thus, by simply not hiring anybody, you are, I would say, quite rapidly increasing your productivity. As people can use more of their time with the technology needed by the customers, rather than onboarding new people, which easily takes six months or a year or even more. Okay, thanks. That's all for me. Lars, want to go next? Yeah, thanks. Can I just tell a bit more about this? You mentioned this phase III project, and you called it an ultra-orphan indication, but still you have more than 100 participants or so in the phase III trial. Is that gonna mean some significant revenues for you? I mean, the involvement in this trial. Obviously, as you know very well, the phase III trial is still some amount away from an approval. Even the approval doesn't immediately turn into big commercial sales for the pharmaceutical company. What I think is quite important from the commercial point of view is that while the studies was earlier only in the continental United States, it is now being expanded to become a global study. This tells maybe about the commitment of the customer into the investment. Secondly, it probably is generally understood in the pharmaceutical industry that they are much more confident on the project and its results in delivering better care for the patients and also its commercial potential. Because the phase III, as you probably know, is typically quite expensive compared to the earlier investments in the pipeline. Regarding its significance to our numbers, it's a bit difficult to comment without giving guidance. This remains a project that we work on, and we are very happy about that. We always take this project as rather, let's say, long-term view, as I believe anybody who is quite responsible in pharmaceutical industry will. Because some of these projects were originally planned to be ready during the past, in the previous decade already. I think also in this project, we have seen our fair share of delays in the past, but we are extremely happy to see that this project, which some prominent physicians have been calling to be potentially game-changing. We are definitely not there. There remains a lot of work, and there is risk related to the project, but it is, in my mind, good sign that they take it to the really, to the next level, as well as now pursuing in parallel new indications to new organs with us and with our platform technology. The relaunch by Bausch + Lomb on Visudyne, has that generated some revenues for you in the, I mean, in the Q3? It has had so far a negligible or no impact. What's the reason behind that? Any feedback on the launch? As we iterated some of these processes with the big companies, namely hospitals and insurance companies, is taking longer than expected by neither us or our pharmaceutical partner. But there have been no fundamental roadblocks or, I would say, roadblocks at all as far as we are aware today. The reviews and the audits are just quite time-consuming and quite a lot of work, and also the customers have also other urgent operational priorities. That work continues, and we are quite optimistic about the future progress. Maybe if some of you will visit American Academy of Ophthalmology conference in San Francisco in, is it two weeks or three weeks? It's starting third of November, so in two weeks. Yeah. There will probably be some prominent physicians who will give some comments about the pilots and their progress. In terms of guidance for this year, you've earlier said that your goal is to grow strongly in each calendar year during 2023-2025. Is that something you hold on to? We have not given any guidance. Our goal is to grow every single year during the strategy period and resume to strong profitability. What we have said in our release, that we see short-term potential. We see- we expect significant revenue next year, and overall positive about the projects. Yes, we are somewhat frustrated about the unexpected delays that we have seen this summer and the autumn time. Okay, thank you. Thank you, Lars. Antti, do you have any questions? Okay, maybe we take them from the chat board. Yeah. From our webcast audience, we have a question. You mentioned a significant number of installed medical laser systems in the U.S. When will this be reflected in an improvement of revenues? Many of them were already asked, but I just wanted to confirm. Maybe we take that from the chat board. Yeah. From our webcast audience, we have a question. Yeah. Yeah. We seem to have some delay on the line. Maybe I'll answer first the question Ulla raised from the chat as we didn't hear Antti's question. The question was, you mentioned a significant number of installed medical laser systems in the United States. When will this be reflected on improvement of revenues? I believe that I addressed this indirectly when I discussed about the pipeline, its progress, and the fact that several projects are close to the commercialization phase, and we estimate the revenue potential to be significant next year. Antti, do you wanna go have a question? Maybe we have a small lag, so let's give it a little bit of time. I think there's a delay in audio, but I'll ask anyway. First, if Inderes team can check what is the delay, because now it appears to be quite long. I just wanted to confirm about your phase III trial. Did you already receive revenue from that, or are you expecting revenue in the future? Also you previously guided EUR 2 million-EUR 30 million. Is that relevant in this case? Inderes team can check what is the delay. Thank you for the question. I'm not sure, or I don't think we have guided anything. Yes, we have already received revenue, small amounts, from the phase III. This is a part of the bigger contract we have with the customer. We have deployed and installed already lasers to that trial. Some of the patients are already being treated and they are being treated with the lasers that we have installed in the earlier small amounts from the phase III. This is a part of the earlier phases of the trial, and we continue to install more almost every week at the moment. I don't know if Inderes team can somehow reset the software or something, because now I start to hear my speech like 30 seconds ago, back coming from the line, so obviously we're starting to experience some technical problems. Okay, he said no further questions. Thank you, Antti. All right. We don't have any remaining questions from audience online. Okay. Thank you, everyone, and have a good weekend. Apologies for the technical issues at the end of the presentation. We will definitely look at those together with the Inderes team, and hope that those will not be repeated in the future webinars. Thank you very much, and have a good rest of the day and weekend. Thank you. Bye-bye. Bye.