Simris Alg

QUARTER 1, JANUARY – MARCH 2024

• Net revenue increased by 6% to SEK 519k (488k).
• EBITDA improved by 11% to SEK -5 325k (-5 999k).
• EBIT/Operating result improved by 6% to SEK –9 037k (–9 595k).

KEY EVENTS DURING THE QUATER

• Simris signed a Head of Terms for an offtake agreement valued at minimum €2M.
• Simris confirmed that it will temporarily pause production at its facility in Hammenhög to complete efficiency study.
• Simris appointed Dr Alexis Roberts-McIntosh to CEO with immediate effect.
• The Board of Simris resolved placement of a directed issue of convertible notes of €1.15M subject to approval at the Extraordinary General Meeting.

KEY EVENTS AFTER THE END OF THE QUARTER

• Simris confirmed that its proposed directed issue of convertible debentures of €1.15M was approved by the EGM on April 5, 2024. The directed issue of convertible debentures was fully subscribed.
• Simris confirmed it had extended maturity to 31 March 2025 for the flexible funding facility.
• Simris published its Annual Report for 2023.
• Simris Board resolved to move the Annual General Meeting to June 28, 2024.

CEO UPDATE
Simris Biologics holds an extremely strong, defensible, position in the ADC payload space with its patented toxins derived from cyanobacteria. It is also sitting on the world’s largest strain library of cyanobacteria. Combined, this gives the company a sustainable competitive advantage that is unmatched in the ADC space. For this reason, I am excited at the real prospect of unlocking and adding value, both at Simris Biologics level as well to the broader Group. The prospect of continuing to build a substantial business around key products that do good for people is a privilege, and I am honored to join the Team.

Within a month in this role, it is clear Simris Group’s vision can readily be achieved by focusing on bioconjugate science innovation and delivery, specifically of ADC payloads, to meet the growing need to fight a number of target cancers and improve treatment outcomes for patients globally.

In the last 22 months considerable work has been completed by the Simris Team to redefine the corporate objectives and activities. The transformation from the low-margin and highly competitive dietary supplement space to the high-margin ADC biopharma and biosimilars space is where the company now has a sustainable competitive advantage with its highly novel IP protected bioconjugate platform.

The sales of Simris Omega 3 supplements via distributors and our own website are not in our core focus and are not profitable, and we have therefore decided to sell out the remaining stock and not refill stock.

As communicated previously, production in Hammenhög is paused whilst a full feasibility on this facility is conducted. Whilst a Heads of Terms covering a 3yr takeoff agreement valued at more than €2m has been signed, committing to a contract would require significant up-front capital expenditure to secure profitability. This is not the best use of Simris capital, and hence other options, including collaborating with others, is under review. The contract negotiation for the take-off agreement with a value up to €2M is paused until further decisions are made.

Almost to the day, the Board's 3 year turnaround plan is on track: the repositioned and repurposed Simris Group now has a dominant biotech pathway, with a clear purpose and capability to commercialise its proprietary ADC payload platform. Including potential to expand into other non-cancer therapeutic areas. My vision for our Simris Group is to build a flexible and agile “hub and spoke” business model pivoting around our patented Simris Bioconjugate Platform. This model will retain and grow our deep technical expertise while building individual license opportunities with successive biopharma partners with specific payload needs. Inherent in this approach is the ability to keep pace with ADC novel scientific innovation requirements. This will also enable Simris Group to form meaningful, value-creating opportunities with collaborators and commercial biopharma partners.

Over the next 3- 6 months we plan to continue to grow our expert Simris Team in the development and commercialization of bioconjugates for the biotech space. In partnership with other key external teams build our novel platform further and secure appropriate license opportunities and wider collaborations.

These license agreements with pharmaceutical companies are expected to bring significant revenue, with each license agreement for a single payload typically worth around $100m, including milestone payments, and additionally in the longer term through sales of payloads/toxins as well as royalties of any ADC drugs approved & delivered to market. Tapping into my 27 years in the pharma space, I am currently progressing several key collaborations and partnerships, each of which will drive us closer to our first license agreement.

Our mission is to treat cancer with greater precision than chemotherapy or radiotherapy. We will do this using our ground-breaking ADC payload technology, through strategic alliances with drug developers. Every day we move closer towards this goal.

The report is published on Simris Groups website:
https://simrisgroup.com/financial-information/financial-reports/