Q-Linea

Fourth quarter: 1 October–31 December 2023

• Net sales amounted to SEK 0.1 million (0).
• The operating result totalled SEK -55.4 million (-59.6).
• The result for the period amounted to SEK -54.2 million (-63.7).
• Earnings per share before and after dilution amounted to SEK -0.46 (-2.18).
• Cash flow from operating activities totalled SEK -48.2 million (-79.7).

Full year: 1 January–31 December 2023

• Net sales amounted to SEK 4.4 million (12.8).
• The operating result totalled SEK -230.6 million (-262.2).
• The result for the period amounted to SEK -229.4 million (-268.7).
• Earnings per share before and after dilution amounted to SEK -3.48 (-9.20).
• Cash flow from operating activities totalled SEK -228.5 million (-250.9).
• As of 31 December 2023, the Company had a total of SEK 81.9 million (72.9) in cash and cash equivalents.

Significant events
In the fourth quarter of 2023

• The Company presented strong ASTar results from the first commercial evaluation at a large biomedical congress, IBMS.
• Q-linea entered into two agreements for distribution of ASTar instrument and consumables in Finland/the Baltic states and Benelux.
• Q-linea installed its first two ASTar systems in the US pending market approval.

After the end of the period

• The Company was awarded a public tender for rapid AST instruments and consumables issued by Fondazione PTV in Italy.
• Q-linea successfully concluded the clinical trials required to add the drug Meropenem-Vaborbactam to its existing ASTar-panel.
• The Company announced that Stuart Gander will take over as CEO of Q-linea and that Anders Ljunggren will take office as Managing Director of Q-linea AB in Sweden on 1 March 2024.
• Q-linea initiated a cost-saving programme with the aim of focusing on its commercial operations.
• The Company received its first order from its distribution partner in Finland and the Baltic states and signs agreement with logistic partner for the American market.
• Q-linea creates separate subsidiary for Podler.

CEO comment
As we look back on 2023, I am proud to say that after starting the year with no partners, through methodical work we successfully built a strong network in all of our key geographic markets in the EU. By the end of 2023, we were able to add Finland, the Baltic states and Benelux to the list of markets where ASTar is now available through partners. We also established subsidiaries in Italy and the US.

During the year, several evaluation studies confirmed the value of rapid susceptibility testing and improved diagnostics for patients who have access to the technology. An example from the UK showed how ASTar effectively mitigated an outbreak of a highly resistant bacterium by enabling rapid intervention. These results are encouraging to see, especially given the burden faced by hospitals during and after the pandemic. Positive results from this commercial evaluation were presented at the IBMS congress in Birmingham during the quarter.

The largest comparative study of rapid susceptibility testing was carried out in Belgium during the year, with the results expected to be presented in the first half of 2024. I look forward to this and expect that ASTar performed as well in this study as in previous individual evaluations. Studies that highlight the performance of ASTar in real-world settings and its support for treatment optimisation are essential for promoting the uptake of ASTar.

After the end of the period, we also showed that ASTar is highly competitive. In our first tender in Italy, we beat out the competition despite having the highest tender price. We won by scoring significantly higher than our competitors on technical performance.

We can see that our intensive efforts to conduct customer evaluations for ASTar and rapid susceptibility testing are now starting to pay off, with over 15 tenders in the EU either announced or in preparation. Most of these are planned in Italy, which was the first European market we targeted. It is gratifying to see that our dedicated efforts to establish ourselves in the Italian market are now starting to yield results, and we have noted that also our distributors are quickly establishing themselves in their markets. It is my firm conviction that rapid susceptibility testing will eventually be implemented in all hospitals that carry out blood culture analyses.

To sum up, we made significant progress during the year, despite the market being significantly impacted by the pandemic. Customers have been forced to delay procurement, but rapid susceptibility testing is now becoming a priority in hospital budgets. We are hopeful that sales will increase in 2024 now that we are seeing the first signs of a positive turnaround in the EU. To further enable increased commercial focus, and as communicated earlier, we are now conducting a large restructuring program that will save some 50 MSEK on an annual basis with full effect second half of 2024.

In the US, our dialogue with the FDA has continued and intensified, and I believe that we will soon secure approval for the US market. As soon as ASTar is approved, we will allow hospitals and hospital chains to test the system, and in December – in preparation for launch in the US – we installed the first two ASTar systems for evaluation at two prominent labs. Discussions regarding possible partnerships for the US market are ongoing and are expected to intensify once approval is received.

We are continuing our efforts to obtain a unique New Technology Add-on Payment (NTAP) code for the US market. Our eligibility to apply for an NTAP is based on our breakthrough designation from the FDA. The aim of NTAP is to give new technologies a faster route to market. If we are successful in obtaining an NTAP code, ASTar customers will be able to receive extra reimbursement on top of the regular lump-sum diagnosis-related group (DRG) reimbursement that the hospital receives, which would be very positive.

As this is my last quarterly report, I would like to take this opportunity to thank all of our employees, directors and owners who have supported me over the years. Together, we have successfully built an outstanding company that will play an important role in improving care for patients with serious infections while contributing to the fight against antibiotic resistance.

It has been a pleasure, and I feel grateful to now be able to hand over the reins to Stuart Gander who will continue the work of commercialising ASTar and moving the Company in a positive direction.

Uppsala, 26 February 2024, Jonas Jarvius, CEO

This report has not 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.

Presentation
Q-linea invites investors, analysts and the media to an audiocast and teleconference (in English) today, 27 February 2024 at 1:00 to 2:00 p.m. (CET). CEO Jonas Jarvius and CFO Christer Samuelsson will present Q-linea, comment on the interim report for the January to December 2023 period and respond to questions.

To participate via webcast, please visit the following link: https://ir.financialhearings.com/q-linea-q4-report-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:
https://conference.financialhearings.com/teleconference/?id=50048290

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.