With significant expertise in the field of inhalation, Iconovo has created four inhalation platforms, which are used to develop complete inhalation products in collaboration with international pharmaceutical companies. The company's business model consists of three pillars: CDMO (contract development), licensing agreements and product sales.
Several agreements concluded during the year
During the year, Iconovo has focused more on contract development to generate cash-positive revenue streams that will reduce capital requirements and bring the company closer to its financial goals. The company aims to achieve profitability in a single quarter in both 2024 and 2025 and full-year profitability from 2026 – read more about the strategy here.
In 2023, Iconovo has entered into three agreements within contract development with Kiox Pharma, Affilogic and ENA Respiratory, and the company has been working with Arcade and Monash University.
Strengthened finances and ownership base
During the year, Iconovo has carried out two directed new share issues of approximately SEK 55 million and SEK 19,2 million each. Existing institutional investors as well as private investors participated, including Gerald Engstrom which the company was able to welcome as a new main owner. Read more here.
Strengthened by the capital raisings, the company continues to drive operations forward with a strengthened focus on cost efficiency.
CEO comments on the year
BioStock contacted the company's CEO Johan Waborg to learn more about the past year and the goals for 2024.
First of all, how do you view the past year?
– It has been a tough 2023 for companies that are not yet profitable. Despite this, we have taken important steps towards reducing our burn rate by laying the foundation for our CDMO business through new agreements and expectations of 3-5 new agreements in 2024. The projects are structured so that they usually become more profitable in the second year. We have also made significant progress in the ICOpre project where we now have an attractive project to offer the large generic companies, and an ongoing partner process where we have been in discussions with basically all large generic companies.
What were the most important events in 2023 according to you?
– We signed three new agreements for contract development and now have a total of five agreements where we help companies develop an inhalation product based on one of our inhaler platforms. A good foundation to build on. In parallel, we have initiated a structured out-licensing process for the ICOpre project with the established investment bank Stifel. We have come a long way in the development and it is time for a partner to come in to take responsibility for production and clinical development.
How are you working to strengthen your cost efficiency and achieve profitability?
– Starting in mid-2023, we have continuously seen an improvement in the KPI we have for our progress towards profitability – rolling six-month average EBITDA has now turned upward after a period of large development costs for ICOpre.
– In 2023, we have optimized the organization, and for example reduced the number of consultants. For comparison, we were up to 38 full-time equivalents for a period at the end of 2022. At the beginning of 2024, we will be around 29 people and have good conditions to take on increased ambitions with 3-5 new projects during the year. Each of these projects contributes around 20-40 percent to profitability. Entering into agreements for ICOpre, entering into an additional 3-5 agreements and taking our existing customer agreements forward will bring good revenues and are good steps towards profitability.
Finally, what goals have you set for 2024?
– In 2024, we will take several important steps towards achieving full-year profitability in 2026. In 2024, we aim to enter into a licensing agreement for our ICOpre portfolio. It is a generic interchangeable variant of GSK’s Ellipta inhaler that we have developed together with associated drug formulations. It represents a major opportunity in asthma and COPD, with a global market worth over USD 5 billion that we can tap into by entering into a partnership and licensing agreement with a pharmaceutical company.
»In 2024, we will take several important steps towards achieving full-year profitability in 2026. In 2024, we aim to enter into a licensing agreement for our ICOpre portfolio.«
– We have also indicated that we aim for an individual quarter in 2024 to be profitable. Otherwise, it is important for us to take the important ICOres-Symbicort project forward in the study program. We have a well-filled sales pipeline and discussions with many companies that are interested in inhalation for their projects. The goal is to sign agreements for 3-5 of these during the year. I believe that a brightening macroeconomic situation will benefit us as the willingness to invest among our customers will likely increase – this could lead to more closures in our sales process.