Hello everybody, and welcome to this webcast. We are going to spend some time to talk about the license deal which we have entered with Biogen concerning our Xcimzane program. It's a brief presentation of 15 minutes or so to be followed by Q&A. My name is Martin. I'm the CEO of Xbrane Biopharma, and with me I have also Siavash Bashiri, who is heading up our biosimilar programs. Okay. Xcimzane is a biosimilar candidate to a drug called Cimzia. Cimzia is a TNF alpha inhibitor used in treatment mainly of rheumatoid arthritis and also psoriasis. It is differentiated product in that market. We're talking about a market of some EUR 40 billion looking at TNF alpha inhibitors. Cimzia has some 5% of that market, EUR 1.8 billion of annual sales. It's a differentiated product which has allowed the product to take that position and also grow continuously throughout the years. It is the only product in this market that has been clinically proven to be safe for pregnant and breastfeeding women. The reason for that is that it's a so-called pegylated molecule which makes it not able to find its way into the fetus. It's safe for pregnant and breastfeeding women, which is a substantial part of this market and making that differentiation. As you can see on the right-hand side here, it's a product which generated some EUR 1.8 billion sales in 2020, mainly coming from the indication of rheumatoid arthritis. Xcimzane, then, that is, a biosimilar candidate to Cimzia. As many of you know, it's our second biosimilar candidate. First biosimilar candidate we have under development is Ximluci, which is under registration process with EMA. It's the second program and the biosimilar candidate to Cimzia. First a few words where we are in the development process. We have spent quite some time last couple of years to establish the production process in pilot scale, which we do here internally in our lab in Solna. We signed a deal with AGC Biologics in September last year to scale up the process at their facility to commercial scale and to be able to supply material to the upcoming clinical trials. That process is ongoing. To our knowledge, this program is the only biosimilar candidate under development globally referencing Cimzia. It's a quite unique development program actually. The reason I believe why we have been able to do what no one else has been able to do globally is our platform technology. We've been talking a lot about this platform technology in the past, but I think this is really a program where we're able to show what we can do with it. Really enables us to develop a biosimilar candidate in a situation where no one else has been able to do it. Our platform technology gives us essentially higher, so-called yield compared to standard system, in expression of the target protein. What is then yield? You all know that, producing these biological drugs is a fermentation process. We gene modify host cell to express or produce the protein we're interested in, put it into a large fermentation tank, and then we talk about yield, which is essentially the grams of protein we get out per liter of fermentation media. That is important because, in production, more or less, you have a fixed, cost for occupying a fermentation tank at a certain scale. If we can get 10 instead of 1 g/L fermentation media, it has a massive impact on the unit cost per syringe or vial or whatever is the final format. That is particularly important in a situation like this where production cost constitutes a rather high share of the pricing of the product. It becomes very important to have high yield, low cost to be able to have a commercially viable biosimilar candidate. I think that is what we've been able to do, whereas others have failed. That's that with regards to the program. Now we have since a year or so been in a process of trying to tie up a commercialization partner. For this program, we are very happy to now announce that we partner up with Biogen to take this program further in its development and later commercialization. Biogen, many of you probably know about the company, one of the pioneers in the biotech business, and focused mainly on novel drug development in the neurological space, but also having a substantial biosimilar business, and particularly in the field of TNF alpha inhibitors. That's where I think that Biogen fits very well. They really have the experience with regards to development and commercialization of TNF alpha inhibitors. A big company, of course, with some $13 billion of annual sales in 2020 and some 9,000 employees. I think it's a very good partner for us for this program from kind of a competence complementary perspective. I think also this is a deal which fits us very well given where we are in the company's development. Just to walk through the key terms here. We have outlicensed in this agreement the global rights to Xcimzane to Biogen. We are going to be responsible for the preclinical development, and then Biogen is going to take on the development and assume responsibility for the clinical development and the regulatory development globally, and also fund all those activities. The economics are the following that we'll get an upfront payment of $8 million upon signing, and then there are $80 million in milestones, and then royalties on the eventual net sales of the product. I think this is a particularly good deal for us since if you think about it from a return on investment perspective, we focus on what we really do best, the preclinical development. We get leverage for our platform technology and our competencies within the preclinical development. We can allow for our partner to assume and fund the other activities. As you know from what we're discussing before, it's a limited investment that goes into the preclinical development. The majority of a development budget really comes in the clinical phase. If you would look at this from a return on investment perspective, it's an astonishingly good deal. It's extraordinary good, I would say. We pay off the investment multiple times throughout the development from the upfront and the milestone payments, and then multiple times yearly, most likely, when the product is on the market. It's a very good deal, and it then allows us to focus our resources into expanding our pipeline and doing same kind of deals with the future products. Very good terms, I would say. Just to finish off with our broader pipeline, as you know, of course, you are familiar with our Ximluci program, Lucentis biosimilar, which we have partnered up with STADA and Bausch + Lomb and is in the regulatory phase with EMA, and BLA soon to be submitted. The Xcimzane program is our second program. We announced this the latter part of last year, we introduced two new biosimilars in combination with our previous biosimilar candidate, Xdivane. We now have an oncology portfolio constituted of biosimilar candidates Opdivo, Keytruda, and Darzalex. Three very interesting products here. This deal with Biogen now allows us to gradually focus more on this oncology pipeline, which is addressing a very significant market, and products which goes off patent in 2028 and onwards. It also allows us now to, as we've said, introduce at least one new biosimilar development program annually. Again, I think this is a great deal for us. It really is a type of deal we would like to do with future products as well to really allow us to focus on doing what we believe we're best at, the preclinical development and applying our platform technology to get to the highest possible yield and lowest possible cost of our biosimilar candidates. I think that kind of concludes this brief presentation about this license deal with Biogen, and I think we can open up for potential questions. Thank you. Ladies and gentlemen, if you wish to ask a question for the speakers, please press zero-one on your telephone keypad. You may also submit your questions by writing. We have a first question from Mattias Häggblom, from Handelsbanken. Please go ahead. Good morning. Mattias Häggblom, Handelsbanken. Two questions please. Firstly, can you talk about the process a bit more in detail? Maybe how many interested parties did you have? Did you have multiple term sheets out, or was this an exclusive dialogue with Biogen? I have a follow-up. No, it was a process where we had a couple of interested parties. Not more than a handful, but a couple of interested parties. We conducted a dialogue with a few of them in parallel, but then we felt that this proposed arrangement with Biogen was the best one for us and proceeded with that. Good. In terms of the tiered royalties, can you talk about whether it starts at high single digit and peaks at low double digit or any way to help us think about this structure? Yeah, no, I cannot reveal anything further with regards to the royalties and this is due to agreement what we have with Biogen, what we shall and shall not reveal with regards to the terms. There are royalties. I cannot state the exact figures, but I would be saying that they are customary to what one could expect in out-licensing of a preclinical program. I don't know if that helps, but that's probably as much as I can say right now. Perfect. Thank you so much. Okay. Thank you. Thank you. We have a following question from Dan Akschuti from Pareto Securities. Please go ahead. Hello, Mr. Dan Akschuti, your line is open for the Q&A. Hello, can you hear me? Yes. Please go ahead. Dan Akschuti here from Pareto Securities. Congratulations, Martin, and to the whole Xbrane team for this great deal. Just a few questions from my side. If you could shed some more light on how the Biogen discussions were going, how long they took and if Biogen in the process showed interest in your platform technology or were they always very specifically interested only in Xcimzane? Sure. It was a process which lasted for approximately 12 months, which is in our experience roughly the time it takes to conclude such a deal. We were then running commercial discussions in parallel with due diligence activities where of course Biogen looked into the development and what we've been doing so far and making sure that it held the required quality. Yeah, roughly 12 months period I would say it took and yeah. Thank you. Did Biogen show any interest in the platform technology or were they mainly focused on Xcimzane? Yeah. No. This was the discussion exclusively regarding Xcimzane. But I do think and I do hope that we can be working with Biogen going forward also on some of our pipeline products. I think we've had a very good discussion with them and I think that the teams got along very well. I hope that we could be doing more things together in the future. Okay. Thank you. The last question, where is the drug substance manufacturing occurring? Is that at the Lithuania site? No. We signed the deal with AGC Biologics for scaling up the drug substance manufacturing. It's done in their site in Seattle. Okay. Thank you very much. Thank you. That was all from my side. Thank you. We have a new question from Christophe Beghin from Kempen. Please go ahead. Hello. Good morning. Indeed, Martin and team, congrats. A question from my end, I might have missed it, but can you maybe elaborate a bit more on how do you see the market for Cimzia and Ixekizumab, the potential in terms of market share at the time of course launching and commercializing when it comes off patent? Is it also Ixekizumab is still the only biosimilar candidate in the space as far as we know. So how do you see the potential on this $2 billion and even on the peak sales it's expected to reach $2.5 billion sales? Can you elaborate a bit more how you see that? Yeah. No, indeed, we're targeting an originator product with roughly EUR 2 billion of annual sales. ixekizumab is the only biosimilar candidate going for that product. Under those assumptions, I think again, we can look at what history tells us with regards to market share gain over time or the penetration curves where we've been seeing that the biosimilars can take, you know, 50% volume share in 12 months or so. At price discount of anything from 20%-40%. I do think that the price discount is mainly driven by the number of biosimilars on the market. I think that if it's only one biosimilar, it will probably be more like 20% down than 40% down. You can do the math, and this is just, let's call it the extrapolation from what we know historically speaking what typically happens. It could be a product with annual sales of some EUR 700 million if you use those assumptions. That is, it's kind of speculation from our end, but it's not, you know, unrealistic way of looking at the potential of the product. Okay, that's clear. I have a maybe out-of-the-box question, but can you tell us did you have a better negotiation position given there is only one biosimilar candidate to, let's say, parties like Biogen? Yes, I think so. I mean, it's the way it goes, right? How many sellers do you have, so to say, and how many interested buyers do you have, and that dictates the negotiation position that you have. Yes, the fact that we are alone definitely put us in a better situation in this out-licensing process than should it have been more competition. Yeah, definitely. One last question. Can you confirm there was a lot of interest from other parties as well in licensing this? You know, we conducted discussion with a handful of potential partners. One should remember a few things. We had an interest in doing a global deal. In terms of partners that can undertake a global program, you kind of limit the number of companies you could be working with. You should remember that this is a rather early stage deal, preclinical phase that also you know limits the number of partners who are willing to enter into deal at such a stage. I think full credit to the team over here in being able to actually strike a deal like this in a preclinical phase. It's not that common actually. That's what we wanted to do because I think it fits well into where we are from a company perspective. As I said, it really allows us to then, well, get some co-funding of the program early on, which of course is helpful, but also to be focusing on building our further pipeline. Okay. That's clear. Thank you, Martin. Thank you. We have no further questions over the phone for the moment. Ladies and gentlemen, once again, if you wish to ask a question over the phone, please dial zero one on your telephone keypad. We have a new question from Christophe Beghin from Kempen. Please go ahead, sir. Yes, maybe given there are no other questions on this deal, are we allowed to ask a question on other topics? Sure. Go ahead. Yes. Okay. I've simply a very short question. Can you, I've noted in the presentation that you still foresee the approval of Ximluci in both European Union and U.S. to be in H2. We haven't seen yet the submission at FDA. How do you look at that for the U.S. knowing that it is typically 10 months on average before- Yeah. Oh. Sure. With regards to filing for Xdivane in the U.S., we still stick to our previous communication that we're going to submit during the first quarter, so during this quarter. Now the regulatory process in the U.S. can be anything from 8-12 months. We hope that it can speed up the process so we can get it in place towards the end of the year. That's what we hope for. Yeah, you know, I fully agree, and I fully support the case. Of course, I think it does make sense, but of course, the longer it takes. There is always a first mover advantage in this market, so it's very crucial to have this finalized as soon as possible, I think. I think we are on the same line on this. No further questions from my end then. No, I agree with you. Thank you. We have a new question from Mattias Häggblom from Handelsbanken. Please go ahead. Thank you. Just a quick follow-up in terms of the milestones of SEK 80 million. Curious to hear if they're all regulatory or are there also part of it that is sales related milestones. When is the more material first milestone due? Is that first in man or any color on that would be helpful. These are both regulatory and commercial milestones, but the majority of it is regulatory-related. It is related to the continued development of the product. Scale up, a successful scale up, let's say. Initiation of two different clinical trials, phase I and phase III, and then regulatory approval across different important territories, let's say. Roughly speaking, along such important milestones over the course of the development. Perfect. Thank you. Thank you. No other questions for the moment. Excellent. Okay. If no further questions, we shall thank everybody who called in and listened, and we shall conclude the call. We are always available via phone or email, should you have further questions with regard to this or other things of our business.