Welcome to the Q-linea Q2 Report 2024. For the first part of the conference call, the participants will be in listen-only mode. During the questions and answer session, participants are able to ask questions by dialing pound key five on their telephone keypad. Now, I will hand the conference over to CEO, Stuart Gander, and CFO, Christer Samuelsson. Please go ahead. Hello, and good afternoon, everyone. This is Stuart Gander here, CEO of Q-linea. I'm joined by my CFO, Christer Samuelsson, for Q-linea's Q2 report. So thank you for taking the time to join us. We'll do this, similar to previous. I will make some opening comments, give you a general sense of where we are in the business, some of the highlights from the last quarter, and then I'll turn it over to Christer, who will walk us through the financials for the quarter. So with that, just a quick flash of our regular disclaimer here. So you've read that with respect to any forward-looking statements. A few of the key messages wanted to make sure that you hear during our discussion today. Number one, following the FDA approval at the end of April, we're now in full commercial push mode in the US. I'll speak to it more in detail, but obviously, this is a very large market with a large opportunity for Rapid AST. So we're being very thoughtful in terms of how we approach it and segment it. So we utilize our relatively small commercial team on the ground where we have the most opportunity for early-stage traction. So I'll talk a little bit about that. Second piece related to our commercial expansion is on the geographic side. We've had a presence now in Western Europe for some time, and with expansion into the U.S., our focus is now shifting to a global and steady expansion of the ASTar opportunity around the world. Obviously, you know, there are a great number of geographies and potential partners, so we're being thoughtful in terms of, again, how we deploy resources and which markets we enter at what time, so that we don't get too far over our skis, but at the same time, open up new opportunities for ASTar to reach patients. Thirdly, we've talked about this before, but the cost-saving program that was initiated at the beginning of this year has completed. Christer will speak more to the details, but all of those changes have been done as planned and on time. And in fact, on the cost side, we're slightly above the cost project projection that we anticipated, or that is to say, slightly more savings than we anticipated. So we will see those coming through the back end of this year. And then finally, again, as communicated previously, we're very pleased that we've had an extended financing arrangement with Nexttobe, our largest shareholder, and that will carry us through into the back part of this year. So some of the key messages, and with that, I'll get into the next level of detail here. So four areas of focus for me since joining and stepping into role roughly four months ago. Number one, that commercial acceleration, right? So we have now shipped our first instruments to the US with dedicated US software and specifications. So with the FDA approval, we now have a US-approved menu, and those instruments that go in now can essentially stay on site, when customers sign the contract. So previously, customers have had opportunity to use the ASTar platform under early access programs and for our clinical work, but these are now commercial instruments going to the US for evaluations. The second main point here is we continue to receive endorsement from the CMS with respect to the NTAP reimbursement funding. We've not yet got final approval from CMS on this, but they have communicated their recommendation for reimbursement coverage at $97.50 per patient. So this would be applicable for any Medicare patients that have a Rapid AST test done on the ASTar platform, and this will help labs and hospitals defray the costs of Rapid AST. And we expect, therefore, to not only accelerate the adoption of Rapid AST, but specifically to encourage the consideration of ASTar by hospitals and labs. We have continued to make commercial traction in our other core markets as well. We've shipped an additional unit to Italy. We did communicate another tender, which we are participating in, in Belgium. And then there are several other markets that continue to progress in terms of customers evaluating and contracting on ASTar. So hopefully more to communicate on those soon. And then, as I mentioned previously, considering our geographic expansion thoughtfully here into new markets. On the customer engagement side and scientific engagement, we... I mentioned in last quarter's report, our presentations at ECCMID, which were very well-received. We have interim results for our health economics and outcome research study that continues in Italy. We shared some of those highlights as well at the ASM conference in the US, and continued to get strong customer interest for those publications. Also happy to see that the broader industry continues to invest in publications for the benefits of Rapid AST, which we now see is both a hot topic and increasingly getting a body of evidence and support of the practical and clinical advantages for hospitals in going that route. So my second area of priority after the customer acceleration has been really around innovation and product development. The aforementioned FDA approval was a very nice culmination of the huge amount of effort from the team to secure access to the U.S. market. Our work doesn't stop there. Immediately after getting that approval, we have submitted for version two of our menu, which will provide more drug- bug combinations to our U.S. customers, further strengthening our offer there. I would note that, you know, throughout this period of restructuring, which obviously has its, you know, demands on the organization, we have managed to keep all of the internal milestones for our development projects. So I think that speaks to the commitment of the team, and the capabilities in our development team. So we continue to make progress in terms of expanding the capabilities of ASTar for our next generation software and further menu expansions down the road. Third area of focus for me has been around the organization. So as I've mentioned, we've now completed that restructuring process and are settling into the new organization now going forward. You know, we continued to make targeted investments, including in the U.S. market, where we've added a couple team members really to help turbocharge our U.S. launch, giving us more commercial firepower in that market. You know, and then the other area of focus for us is really strengthening that end-to-end customer care and service support experience. We anticipate placing, you know, a number of ASTar instruments around the world, going forward, and this will place more demands on the service team. So this is one of the key areas of a focus for the team in the months ahead. And then finally, on the financial side, overall, tracking ahead of the budget that was set, we see those costs coming down slightly faster than anticipated, which is good news. Christer will speak to that, more in detail. You know, my focus and that of the team really remains on driving the top-line growth, keeping in mind that in many of the markets, we will expect to see reagent rental models, which means when instruments go out, it does take a little bit of time for the revenues to come in as usage of those, you know, grows over time and customers buy and use kits for their patients. So with that, maybe I'll just jump into some further comments for those that are new to Q-linea, new to the... to Rapid AST. You know, it's worth reiterating our core proposition, which is in our view, a market-leading one. The ASTar platform promises a less than 6-hour turnaround time for critical blood infection diagnosis, which both in terms of clinical impact has a clear benefit in reducing the impact of sepsis and saving lives. It also saves time and money, and critically, lab time in managing patient workflow. The actual workflow on the instrument is second to none. It's less than two minutes of hands-on time, very simple interface, and critically, is a continuous access and random access platform with very minimal training need for a user, making it very easy to plug into any microbiology lab around the world. And then finally, with respect to that menu, very comprehensive menu, and continues to demonstrate very strong performance in the field with respect to consistency, reproducibility of the test results. So here's a quick view of our U.S. cleared ASTar panel. We received that clearance on April 26th. So we're very proud of that. This panel, it will continue to be strengthened, as I mentioned earlier, with the version two. We will leverage the clinical data that's been gathered over the last months for that resubmission, and we'll expect to see that in the quarters ahead. So with respect to the U.S. market, you know, as I mentioned, there's... It's a very significant size market, geographically at large and relatively complex in terms of the makeup of different types of hospitals, labs, configurations, et cetera. So, the first order of business for us is to be very thoughtful and structured. The team has done a great job segmenting the roughly 1,600 or so labs that we think are relevant for the ASTar platform and really focusing on the top 50 to around 100 of those centers. These are the labs both that have the volumes that make it very interesting to start there, but also crucially are ones that have proven themselves to be earlier adopters of technologies. They often have what we call key opinion leaders, thought leaders in the field, the types of decision-makers that can move quickly with their lab to bring new and beneficial technologies to their patients. So we're having active engagement with several dozen of these and are now setting up evaluations over the coming months. So we'll expect to see the contracting periods for those commence after the evaluations. You know, the main thing here for us is to really demonstrate the performance of ASTar by getting the instrument into the hands of the lab techs and the lab managers who use it day-to-day. We see consistently very strong feedback once the instrument is in the lab that you know folks see the benefits and the usability advantages of the ASTar approach. And this we think is going to lead to a very strong reception both the evaluations that we're now setting up. So attention will eventually you know shift from getting those values to patients going to the conversion and contracting over the coming months. In support of that customer engagement I had the privilege of joining the team in Atlanta in June for the ASM conference which is the largest U.S.-based microbiology conference. It sort of mirrors in some ways the ESCMID conference that happened earlier. We were able, obviously, to leverage some of those similar scientific findings for our poster presentations. It gives us an opportunity to interact with the more than 5,000 clinicians and scientists in the field across the U.S. It was interesting to note that as with ESCMID, rapid AST remains a focus area for research and scientific endeavor in the field. We're also not the only players talking about this space, so there, as I mentioned, are a number of studies and poster presentations coming out that really further, you know, support the clinical benefits of rapid AST. So speaking to that, you know, it's worth highlighting again, the interim results from our health economics and outcomes research in Italy. We've talked about this previously, but, you know, the numbers are worth highlighting again. That we see, you know, up to 34 hours improvement in time to result in using ASTar versus current standard of care. And the sepsis environment, where every hour counts, every hour leads to increased mortality, this has tremendous benefits for the outcome of the patient. We've noted in the interim results that almost half, just under half of patients had adjustments in therapy. That means that these patients are either receiving, in many cases, an escalation in therapy that would, you know, suggest that their clinical outcomes may have been worse had they not received a different and appropriate therapy. So that, and that's out to around a quarter of the patients. And the remainder of the patients are able to deescalate, which means that there's less toxicological impact on the patient, and also some savings for hospitals as well, and crucially, improved stewardship, and retaining the ability to use our most impactful drugs for patients truly when it matters, rather than driving that antimicrobial resistance challenge. So, you know, this is just some of the data that's coming out into the market and encouraging that shift towards rapid AST. So just to round off a little bit here, you know, we continue to focus very much in the immediate phase here on the commercialization of the ASTar platform, in the US, and now increasingly globally. Our development pipeline is focused on further strengthening the proposition of the ASTar with menu expansion. We've mentioned, for example, Gram-positive, which is another roughly 50% of the of patients with bloodstream infection. So that we would expect to expand that menu in the future. And then there are, down the road, further applications in terms of other test types and modalities going forward. So with that, I'll turn over the comments to Christer to highlight the financial developments for the quarter. Thank you, Stuart. Thank you, Stuart. I'll start off with some financial highlights for the quarter. As Stuart already mentioned, we have completed the cost savings program that was initiated earlier this year, and it's, it's has been a really good savings program, and we can see the full effect from the SEK 50 million savings in Q3 and onwards. We are happy about that one. We have also been offered an additional loan facility, as Stuart mentioned, and the total loan facility from our main owner, Nexttobe, now amounts to SEK 101.5 million. The unutilized part, as of thirtieth of June, is SEK 60 million. Looking at the cash and available loan facility as of thirtieth of June, the amount in total of SEK 80.9 million. Looking at the operating result for the quarter, for the second quarter, is that is -57 million SEK, if we exclude the restructuring cost of SEK 8.4 million. The restructuring cost refers to personnel costs, hundred percent. Then we will have a -19 million SEK result for the month in the second quarter, which is in line also with the first quarter this year. Switching to the equity side, I just want to highlight that the parent company equity amounts to 163 million SEK as of June 30, and the equity includes 70 million SEK from the valuation of the padlock technology. That only goes for the parent company equity. It doesn't affect the group equity. Switching to our consolidated statement of profit and loss for the second quarter. The top line was fairly low. As you can see, it's SEK 1.6 million as compared to last year, SEK 1.9 million. As Stuart mentioned, we have a reagent model in many of the markets, especially in Europe and in Italy, where we are very active right now. And that explains that we have a low top line. Even though we have delivered a couple of instruments, we don't see the income coming. It will come later. In short, if you don't know the reagent rental, we will get paid when we sell the consumables. So the consumable price will include everything from both the consumables and the instrument. The operating result, as I've stated before, was -SEK 65.4 million or -SEK 57 million when we take away the restructuring cost, thanks to this cost savings program. Earnings per share -0.56 for the quarter, which is a lot less than last year, which is explained by the rights issue we had last year, which increased the number of shares quite a lot, as you can see. Consolidated statement of financial position in the second quarter. As stated before, we have SEK 20.9 million in cash and cash equivalents, starting off the year with SEK 81.9 million. We have utilized SEK 41.5 million of the loan facility from the main owner. Looking at the average monthly burn rate, for the second quarter, it amounted to SEK 16.7 million, which was slightly lower than for the first half year, when it amounted to SEK 17.1 million. As stated before, we now have SEK 80.9 million, or as of thirtieth of June, we had SEK 80.9 million available funds. Inventories is going in the right direction. We—it's lower than last year, the SEK 40.4 million, and is also lower than the end of Q1, which is positive. And we still have a large number of instruments, which is positive, in the phase we are now in. I talked before about the parent company equity, and now I've switched to the group equity, which amounted to SEK 68.1 million end of second quarter. We have had SEK 18.9 million average monthly decrease on the equity side. I've covered already the parent company equity, so I'll skip that one. Switching to the last page on future financing, and I just will summarize a little bit on the financial side here. As stated before, we have SEK 80.9 million available funds. We have a total loan facility of SEK 101.5 million from our main owner, and is approved by the AGM, 30th of June. Our average monthly operating result for the second quarter was -SEK 19 million, excluding the restructuring cost of SEK 8.4 million. As stated before by Stuart and myself, the cost savings programs will have full effect starting with Q3 and Q4, and we feel confident that that will happen. As some of you might have seen, we have reported that we do not have going concern on that topic, but we are still, just to summarize the thing, where we are. We're still in an early commercialization phase. US launch started, we went up funding, and our sales funnels are growing and maturing, but we have to be engaged in pursuing alternative financing options. So those include, as stated before, strategic partnerships, capitalization of existing assets with Q-linea, and negotiations with new and existing owners, investors, and financiers. It is the board of directors' assessment that the group successfully will be able to finance company operations going forward. Stuart? Great. Thank you, Christer. That concludes our forward comments here. Any questions from the audience, also in written form? If you wish to ask a question, please dial pound key five on your telephone keypad to enter the queue. If you wish to withdraw your question, please dial pound key six on your telephone keypad. The next question comes from Johan Unnerus from Redeye. Please go ahead. Thanks for taking- The next question comes from Johan Unnerus from Redeye. our questions. Please go ahead. I have a few. It, a second here. I have double sound. Yes, what about the prospect of a U.S. commercial partner? Obviously, the U.S. launch is very important during the early stage with approval, and the reimbursement is, seems to come along later this year. Any engagements with potential U.S. commercial partners? Yeah, thank you, Johan. Good to hear from you. So on the partnership side, we continue to explore partners around the world. We've chosen a partner-led model for most geographies outside Europe and the U.S. On the U.S. side, there are certainly benefits to that. We continue to engage with different potential partners in discussion at this point. You know, no decisions or nothing to specifically communicate on that one. I would comment that, you know, in these early days, right now, it's beneficial for us to be able to engage directly, both that we get immediate feedback from the market on ASTar and, you know, its benefits and how we might further develop that. And also, you know, the opportunity to shape the market growth directly with our message and our version of Rapid AST. That isn't to say that going forward, there wouldn't be, you know, clear benefit from engaging a commercial partner. But at this stage, we're very satisfied with the internal team that's opening the market. Yes, and to follow up on that, you're pointing out some 50-100 prioritized institutions, then, can you provide us with a feel for the process, even if it's early days? I mean, even if there is substantial interest from, from some of these institutions early on, presumably there is a process of engagement and decision-taking and implementation. Yeah, very great question. And this is the key thing that defines the shape of our funnel and the timing and so on, to getting to patient tests in the end. So typically, we would see a process in three or four stages, where the first stage is fairly open and vague. It's just around that initial assessment and two-way engagement. Basically, the dating process, if you will, of trying to figure out if we're the right solution for them, and they are the right customer for us. And that process is about understanding the current lab situation, you know, their volumes, the types of patients they have, and also what stage of their own financial economic cycle they're in. Are they in a capital buying cycle right now, or is, is this something they'll be—they'll be interested more in a reagent rental? So that, you know, can be, you know, as short as a couple of months, or, or it can take, you know, half a year or more, depending on, you know, how high the level of interest is here. I would say that, that right now, the types of customers we're engaging, that period is relatively short because, again, we've pre-screened for those that are, likely to be of, of most, most interest right now. And, and, you know, we, we have the luxury of, of picking and choosing a little bit here in the beginning, whom we engage with, and, and folks are coming up to us at the, at the conferences and so on. You know, moving on from that phase, you have one of evaluation. And typically, customers will wanna see the instrument working for a couple of months in their lab. It can take a little bit of time to set up that evaluation. Labs have different information systems and different requirements and space requirements in the lab. So, you know, it can take 2-3 months to set up and run that evaluation. And then there's a period, again, can vary from a few weeks to a couple of months, where they evaluate the results of that in-lab evaluation and present that to their peers and decision-makers. So again, 3-6 months at the longer end for an evaluation. And then from there, you move into commercial contracting and negotiation. Some of this legwork has already been done well in advance. The team will have given the customer some indicative quotes, but now post the evaluation and with further review of their volumes and more discussion, you can have more specific conversations on the pricing model and volume discounts and things like that. So that can be as short as one to two months if the site is already set up and keen to get going, or this phase can take quite some time for multi-site, you know, large reference lab groups with potentially dozens of labs. They will want to take some time here and think that through. But, you know, some customers can move fairly quickly through that. And then the final stage is just the setup and, you know, the final installation. So connecting that over to their, you know, regular standard of care and LIS, full LIS integration, and, you know, final checks internally before they flip the switch and go live with a new standard of care for their clinical protocol. That's usually fairly quick, you know, short as a month. It can take a little bit of time if they need to get some final approvals and whatnot, operationally. So that whole end-to-end cycle, you would typically expect 15-18 months. The initial phase, as I said, is very, you know, hard to determine, but once you're into that evaluation, we would expect to see, you know, 12-15 months type cycle times until, you know, full deployment and large patient volumes. Great, that's useful. In terms of providing an external feel for investors and the likes, can we expect you to present number of evaluations or any other feedback from this process going forward? Yeah, I think it's a fair question, and we've actively discussed this, right? What form of guidance to give. As Christer pointed out, financially, it's very difficult. Even if we place an instrument, exactly what the pull-through rate on that is up to the customer, and we're still the level we're in early stages and don't have that installed base that's generating a very predictable routine revenue. But you're right, the evaluation should be for indicators of contracting. I think it's a good point, and one we're thinking about. Should we make that information more available? Obviously, conscious about not mentioning specific customers and so on, and an evaluation is, you know, itself not necessarily indicative of commercial opportunity. We have evaluations with customers that have, you know, 500 or 1,000 patients a year, and we have evaluations with customers that are well in excess of 5,000 or whole systems that would represent tens of thousands of customers. So, these, some of the realities, let's say, in the U.S. as we try to be thoughtful on providing more visibility on the forward development of the business without also, you know, misleading one way or the other. So just- Yeah Just to understand our thinking there. That sounds reasonable, and it should be a good starting point in a way, without necessarily providing a narrow indication for sales prospects at that stage. Moving on to Europe then, what about the level of dynamics and readiness to engage in AST solution as perhaps a complementary system to begin with? You seem to have making progress in the markets of Italy and Belgium, for example. Yeah. So we see the processes moving along as expected. Tender-driven processes are always longer. In my experience, you know, then, for example, the U.S. tends not to have tenders, and they can run a little more dynamically. We see both an increase in the number of tenders that are coming in now, and also seeing those moving forward. In general, you know, I think I mentioned previously in my comments, I see Europe developing, you know, slower and longer just by the nature of those markets, than the U.S., which has already been primed for rapid AST previously. You know, there has been a competitor in that market with a previous generation for some time. And just the dynamics of the US market, and for example, our NTAP funding mechanism specifically encourage adopting novel technologies quickly. Whereas Europe is a fragmented market, takes different approaches, and the funding and reimbursement mechanisms for labs can be quite complex. So we continue to work through those questions, but we see progress across our core markets, and would expect to see that growth progressing again, slower than the US, but slow and steady. Yes, and finally, from our side, on the financial side, you have completed the restructuring process, which seems like we can expect you to expand the commercial U.S. team somewhat and the support side on that side. What about the run rate in terms of OpEx and cash burn once the restructuring is in place, towards the end, well, during Q3 and towards the end of the year? Is it possible to give feel for that? Christer, do you want to take that? Yeah, I'll take that one. It's a good, good question. Thank you, Johan. And we—I mean, we have given some guidance here, basically, that we have the run rate in Q1 and Q2, and we basically say that the SEK 50 million savings program will have full effect in Q3 and Q4, and that is annual savings. So, I mean, you can always divide that SEK 50 million by twelve, and I think you will be pretty close to- Right - where we will be in Q3 and Q4, on the- Yeah OpEx and the operating results side. That's the guidance we can give. And there is no reason to expect any difference in sort of cash flow and result impact of the SEK 50 million? I would say the risk is low, fairly low. There's always one in the ramp-up phase we are in, we have the working capital to handle and manage. I think we are on top of that. That means that we have to actually purchase and increase the purchases on the commercial side. So that will tie up some capital, but I think we are on top of that one. So no, I think the risk is fairly low, as I see it. Yeah. Okay. Thank you. That's all from us. Thank you, Johan. As a reminder, if you wish to ask a question, please dial pound key five on your telephone keypad. Any further- There are no more questions at this time, so I hand the conference back to the speakers for any written questions and closing comments. All right, I don't see any written questions, so- Me neither If there's nothing else, I think we can conclude for this quarter. So, thank you all for joining, and look forward to speaking with you again in roughly three months. Thank you. Great. Bye.