STRONG PERFORMANCE AND INVESTMENTS FOR THE FUTURE
2020 has been a challenging year, but it is with both delight and pride I can look back on the year and the progress we have made within both our business areas. Nanologica’s strong growth continued and we reached record net sales for the Company so far, at the same time as we made large investments to be able to create value over time. We passed a large milestone when achieving approved material from the upscaling to large-scale production of silica, which creates totally new opportunities for the Company. Our work on forming and focusing the Company to position it for accelerated growth, and eventually profitability, leave us well prepared for reaching new success in 2021.
The net sales for the full year 2020 increased by 75 percent to TSEK 16 135, with the fourth quarter accounting for TSEK 6 071, which are records for Nanologica for both the full year and a quarter. The growth mainly derives from the business area of Drug Development and our partner project with Vicore Pharma.
The largest milestone of the year was passed in December when we received this first test material from large-scale production of silica from our contract manufacturer Sterling Pharma Solutions in the UK. The quality of the material is identical to what we have produced in Södertälje, which means all the data that we and customers have generated on the material is applicable also on the material from large-scale production. This gives us great confidence when accelerating production of silica into ton scale. Next step is to deliver test material for continued evaluation to customers in requested quantities, which will progress the dialogue with the customers.
The development of the Chromatography business area is however two-folded. The pandemic has affected sales in analytical chromatography in a severe way, and we have not been able to conduct sales of our analytical columns according to plan on any of our markets. For preparative chromatography, we have managed to limit the effects of the pandemic to moderate delays; we had hoped to receive test material during the fall, which instead was delivered in December.
In the business area of Chromatography, it is within the preparative branch we see the largest potential with future large contracts and high growth rate, while we see the analytical branch eventually developing into a supporting business. Having achieved a successful upscaling of production, the main targets for 2021 are to deliver commercial products, and to close further customer contracts for the delivery of media for preparative chromatography. To be able to achieve the latter, we have strengthened the sales organization with Dr. PK Dutta as SVP Sales and Senior Advisor. Dr. Dutta has a vast experience from the chromatography industry, with for example 16 years at AkzoNobel, and most recently as President for YMC Americas.
Within the business area of Drug Development, the Corona pandemic has put obstacles in the way for the clinical trial with the drug candidate NIC-001, that we intended to perform in Australia during 2020. The work with the project is therefore currently on hold and we will make an update regarding the plan for the project during the second quarter.
Instead, full focus has been put on our inhalation platform NLAB Spiro™, which is developing in a promising way. The work with toxicity studies on the platform, including two potentially interesting molecules, is ongoing and we assess that we will have the first data from the study during the second quarter this year. Once the platform’s safety regarding toxicity has been validated, we believe there will be opportunities to start further formulation projects, with partners as well as inhouse. The underlying need for development within the respiratory field and the delivery of drugs to the lung is large. Here we believe NLAB Spiro™ has the potential of becoming the next generation drug carrier for inhaled formulations, and that we through the platform potentially will be able to significantly improve current treatments and create totally new treatment options for respiratory diseases.
During the year, our partner projects have continued to develop in a positive way. Vicore Pharma is advancing the VP02 program, based on the NLAB Spiro™ platform, towards clinical trials and we continued to produced material for the upcoming study during the fourth quarter. Also, the collaboration with AstraZeneca continued, in which they evaluate our platform for the purpose of improving the formulation of one of their APIs.
In the partner project within crop protection that was initiated in 2017, the collaboration has been extended to include one further molecule. The aim of the project is to increase the efficiency and improve the release profile for the active ingredient, with the purpose of decreasing waste and environmental impact.
After the year ended, we have also signed a collaboration agreement with the Czech pharmaceutical company Zentiva. The agreement gives them the right to use our NLAB platforms for various drug delivery projects, and the purpose of the agreement is to facilitate the process for future product specific agreements.
During the year we have strengthened the Company’s owner base, with for example Swedbank Robur Medica as the second largest shareholder. We believe that a larger proportion of institutional ownership is advantageous for all shareholders of Nanologica. To position the Company for the future and make the Company available to more, we have started preparatory work for eventually listing the company on Nasdaq main market. An increased institutional and international interest in the Company demands being listed on a regulated marketplace. We have also strengthened the Company’s organization by employing new competencies, and by engaging senior advisors within both preparative chromatography and inhalation.
With high ambitions for both our business areas and for the Company as a whole, I look forward to an eventful 2021 with confidence!
Andreas Bhagwani, CEO