Clinuvel Pharmaceutical Stock

Hello, everyone. Thank you for joining CLINUVEL's Investor webinar today. I'm Stella of Monsoon Communications. In today's webinar, CLINUVEL will share the results and operational highlights for the financial year ended on the 30th June 2026.

I will now hand over to Malcolm Bull, Head of Australian Operations and Investor Relations, to conduct the proceedings.

Thank you, Stella, and thank you to monsoon for hosting yet another CLINUVEL results webinar. Welcome, everybody, on the line. There should be 130 of you very attentive to the news that we're going to provide to you. I have CFO, Peter Vaughan, on the line; as well as our Director of Global Clinical Affairs, Emilie Rodenburger on the line; and Managing Director, Philippe Wolgen. Welcome, executives.

Thank you.

Good morning.

Good morning.

The agenda today is to discuss our results for the financial year ending 30 June 2026. And we're going to have Philippe and Peter and Emilie involved in various aspects of the performance and operations of the business. We also announced some other news today, the consideration of listing all of our ordinary shares on the NASDAQ and delisting from the ASX, and we'll certainly get Philippe to talk to that. We have several analysts on the line who cover CLINUVEL, and we certainly appreciate their coverage, and we welcome their participation in this webinar. They will ask some questions of our executives. And then finally, time permitting, we will address a few shareholder questions that our discussion hasn't quite covered.

So I should share a particular screen with you on our forward-looking statement. We will be talking about intentions and plans, and you should be aware that there's a range of risks that can materialize that affect those plans from coming to fruition. But we will try our best as an executive team and work with the Board to deliver the results that we're advising you. So I want to move into a discussion of the results and strategy.

But Peter, I thought you could set the scene to cover this year's results by providing an overview of how you manage quite definitely the finances of CLINUVEL, which enable us to build the strong foundation we have for the future.

Of course, no problem at all. Thanks, Malcolm. Good afternoon and good morning. Welcome to the webinar from wherever you're dialing in from. It's great to have you here with us. I guess, as Malcolm outlined, I will start with a strategic financial overview as to how we operate at CLINUVEL and the way we go about things.

The financial and strategic overview that we have in finance and what my team and I focus on are 4 key or core objectives. The first is to maintain profitability. We do this by ensuring our year-on-year profits continue, but also that we can dial up and dial down our expenditure and particularly our discretionary expenditure to ensure that we can match the revenues as we see them come through. The second area we focus on is building positive net cash flows. This is why the profit margin protection is so important. And then that positive net cash flow helps to build the cash reserves that we use as our protection for the organization.

Next, we invest in our strategic priorities. Our R&D programs, in particular, our vitiligo program at the moment, but also our capital and infrastructure expansions. You would have seen announcements around our Singaporean facility and expanding our laboratories over there, where we're doubling the footprint. Fourth and final is putting our surplus funds to work. We don't just leave them sitting in the bank. We know that we've been entrusted these funds by our shareholders, and it's really important to us that we put these to work. And this is where we put them in term deposits that at the moment is attracting a 6.23% return. Overall, this financial strategy is designed to build a financial moat for the organization to shield and protect our shareholders. What are we protecting them from? We're protecting them from market forces, and we've seen those affect our industry significantly over the last 2 to 3 years. Investment has really pulled back out of biotech and life science companies.

We also protect our shareholders from dilution using these cash reserves. We've been entrusted those shareholder funds, and we want to make sure we put them to good use. It -- our reserves also provide us with optionality. This optionality is for us to focus on opportunities and take initiatives that we see in front of us, whether they be organic or inorganic. This strength comes from that 10 years of consecutive profit growth, the 10th year being this year. We've established a pristine and strong balance sheet with no debt. This has been our strategy to help absorb shocks in the market or from results if they don't go our way or from delays that might be experienced in programs. It's built our independence from having to rely on the capital markets and the peaks and troughs and volatilities that come with it.

I thought I'd share a quote that we recently received from one U.S. investment banker that we've been talking to as part of our U.S. expansion. And he said, and I can quote him here, he very seldomly sees a life science company with the financial strength that CLINUVEL has managed to build from one product in the market. We're often critiqued internally or mainly externally from shareholders or other investors or people looking in at CLINUVEL that we're too slow or stagnated. We see this as being part of our strategy because if we were to increase the pace of the organization faster than it can handle, it increases risk.

If we were to expand faster than we're capable of sustainably doing it, it increases risk. If we diversify through M&A and then spread our focus of the organization, it increases risk. And if we were to throw more dollars into programs, it doesn't necessarily amount to outcome improvement, in which case that increases risk. So all of these areas is why we have built a sustainably globally marketed product in SCENESSE. We initially focused on one indication in EPP in one market in Europe and then moved to America and spread into the second market. And now through our vitiligo program, we'll expand into a second indication that offers even considerably more market potential than what we have with EPP. I hope welcome and that's a good overview.

I'm happy with that overview because I can now ask you to summarize the financial results, which I'll put on screen for you.

Excellent. Yes. Look, again, this is our disciplined and financial strategy at work, where we've delivered our 10th year of consecutive profits. There aren't too many in the life sciences space that can lay claim to that. Shareholders reading our annual report today would have noticed that the presentation layout of our P&L has changed, and I thought I'd speak to that for a second. The reason being we've now moved from a by nature reporting layout to a by function reporting layout. This now aligns our presentation layout with our U.S. GAAP financials, which is required by the U.S. market. So therefore, we now have more of a standard or traditional P&L layout of revenue, cost of goods sold, gross profit and expenses.

In looking at our revenue specifically at the moment, we've exceeded $100 million of total revenue for the second year running. This was able to then be used to return a ninth consecutive dividend to our shareholders this year, and we basically returned 9% of our net free cash flow from the financial period in the form of those dividends. Expenditure was slightly lower than was forecast, but this is a good thing because we were still able to expand our R&D programs and other capital infrastructure projects that we've discussed.

Our EBIT actually would have been the same as prior year had it not been for the strengthening of the Australian dollar. The reason that this had an impact was we have a significant amount of U.S. dollar term deposits. So translating those back to Australian dollars actually amounts to a financial loss because the Australian dollar has appreciated. We have to translate everything back into Australian dollars. Just for reporting functionality, it's not an actual economic loss because all of our financials in Australia in our ASX reports are presented in U.S. dollars. So this $4 million unrealized translation loss is represented in our P&L, but it's not actually a bottom line economic loss.

Our cash reserves for the period increased by $28 million to $252 million. The other aspect of this is that it would have been even larger. We would have had a $40 million increase. However, during the period, the Australian Taxation Office required us to start making installment payments towards our year-end tax bill, which we ended up having to pay $12 million during the year. Normally, our tax payment goes out in one bulk lump sum in December. So during this current financial period, our reserves increased by $28 million, but we actually also paid nearly 2 years' worth of income tax payments because we paid our FY '25 in full in the first half of this year. And then we also paid the installments throughout the year of $12 million. That's where we would have had a $40 million increase in our cash reserves. The silver lining in this is that now in the first half of next financial year, we won't have this bulk outlay of income tax being paid that we usually have in the first week of December every year. So therefore, our cash reserves will increase in the first half of the year because it's now smoothed throughout the year.

Okay. Thanks, Peter. I wanted to turn to long-term profitability. And I say that the picture tells a thousand words, but I don't want you to use a thousand words because we don't have enough time. But please summarize that profitability trend and the expenses and particularly the revenues, please.

Of course. So as I've touched on before, we're proud that we've achieved $100 million worth of revenue for the second year in a row. And this really came from the treatment volumes that we saw this year. So our SCENESSE treatment program globally had its largest number of treatments ever that we've experienced. That was up 6% on the prior year. We did see some moderation of the U.S. sales and treatment numbers. And we feel that this is because there were other competitors out there that were offering free product through the clinical trial programs that they were offering.

The good news is that whilst these other entrants came into the market with free product, we still saw people return to SCENESSE after those treatments, but it also meant the market was able to sustain not only one player in the market being us, but also 3 entrants without it having a significant effect on our revenues. The flip side to the U.S. moderation of revenue was the European strength. We saw European treatment volumes increased by 13% during the financial period, which boosted our revenue by 9% on the prior year in Europe.

We see the market entrance in the U.S. as being a temporary competitive effect rather than a product structural change for the market. As I said, the EPP population and the EPP market in the U.S. sustained these 4 competitors all in there. Our disciplined financial management in these types of situations, though, this is why it's important to come back to this, enabled us to dial up and dial down our discretionary expenditure as we started to see that U.S. impact of sales. So therefore, we can match -- we can match our expenditures to our revenues while still continuing to invest in our strategic priorities. With all that said, our gross profit margin was 83%, and our net profit margin was still 36%. These are the margins that we're guiding the business by to ensure that we can protect those reserves continuing to build. These sorts of results in a life science company are truly exceptional.

Indeed. Well, let's move to the expenses side and just go into a bit more detail on what was happening there.

Of course. So at the end of last financial year, everyone on the webinar may recall that we came out and said that on average, over the next 5 years, we'll be expending about AUD 55 million. That was on average for every year for the next 5 years. We actually came in at $53.5 million. So we're $1.5 million under that $55 million number. But it's important to note the $55 million actually excluded CBM activities because we see that as some of the discretionary spend that we can ramp up and ramp down. But our $53.5 million actually included our CBM activities. So our true underlying, if you like, expenditure was about $45 million when you exclude that CBM activity of about $8 million.

Across the CBM, we did see it relatively steady or stable from the prior year. We still delivered our major program for the year, which is our AAD in Denver, which was in March earlier this year. Again, building company brand and presence in the market so that people know what we are and what we do. Our general admin was $1.5 million higher than prior year, but -- sorry, was higher than prior year, but the $1.5 million of that actually related to one-off costs in relation to our NASDAQ uplifting. So that amounts to legal fees, audit fees and other aspects directly affected by that NASDAQ uplift.

Our U.S. dollars, that funding investment into our vitiligo program, our NEURACTHEL program, but then also our new controlled release injectable peptide platform that we're running from our Singaporean RD&I facility. The minor reduction in R&D just purely reflects the CUV105 study starting to wind down to completion. It's not actually a pullback of that program. And really, we'll start to see that starting to increase again as our CUV105 program in vitiligo starts to come online later this year that I'm sure Philippe and Emilie will talk about in a moment.

Our R&D expenditure in total was 35% of our total expenditure, and we directly reinvested 20% of our revenues into R&D. Our first decade of commercialization has really built a self-funding sustainable business model and built those cash reserves that help to cement the business and its balance sheet. 10 years of profitability that's consistent year-on-year, it's really unheard of in life science.

Indeed, it is. And staying with you, Peter, since you just mentioned the strong balance sheet, what comments would you like to make with regard to the state of the balance sheet?

Well, I guess the first thing that I would say, Mal, is I think our balance sheet strength is actually one of the most underappreciated aspects of CLINUVEL's investment proposal. And touching on that comment made by the U.S. institution recently in the last couple of months, I think that really supports that. So our cash reserves that I touched on before, increased by $28 million to $252 million. Our total assets increased to $295 million, so just a touch under $300 million in total. I did touch on the fact that, that $28 million increase would have been larger in cash reserves had we not prepaid the $12 million of income tax, but that will obviously have a back-end effect and improvement for our first half of 2027 financial period.

Apart from investing in our R&D programs for our revenues of tomorrow, we're also investing in a number of other initiatives and capital improvement projects. The first one being the doubling of our Singaporean RD&I facility that I mentioned before. So that is increasing the laboratory footprint, which gives it more capability and more capacity for those exploratory R&D activities. We are refurbishing our European office, which is really the head of our European area of our business. And that's a substantial asset on our balance sheet already because we own that premises. So we're really improving that asset for the future. And then the final one is we're also establishing an integrated manufacturing and supply chain now. So we're looking at those avenues to in-house more of that activity and bring it closer to us.

We hold about $231 million in term deposits at the moment across multiple different currencies. And as I mentioned before, that's returning 6.23% yield. So we really don't have a lazy balance sheet, even though we have this surplus of cash, we're deploying it for return for our shareholders. And we remain debt-free for that 20th consecutive year, and it's been 10 years since our last capital raise. Our balance sheet has really been built through profitable operations that we've run and internally generated net cash flows instead of the typical life sciences R&D type process of repeated equity raisings and shareholder dilution. We really entrust and protect our shareholder reserves.

It's important not to underestimate the strength in our balance sheet. It's really underappreciated because it significantly is the fundamental solid base that we can build from. It protects us through these market cycles that can affect other organizations. It gives us capital and optionality to invest, but it also provides us with opportunities without being forced back into the market to fund it. It allows our strategic initiatives to continue and us to continue investing in those without having to consider any shareholder dilution. I would say as an overarching comment in relation to the balance sheet in total, that this -- the first year of our disciplined financial business model, really, we were able to build it and show how it works from a commercial standpoint. And our next decade, we will use that strength to now build our infrastructure, our science and our commercial capabilities for future revenues of tomorrow in the pursuit of shareholder value.

Well, Peter, you've covered a lot of ground in a pretty succinct amount of time, the profitability of the company, how we've established that, your role, the finance team in helping to manage that, the strong balance sheet and the optionality we effectively have. So thanks for that.

I'm going to switch now to Philippe because today, we announced a major strategic intention, and I'm simply going to ask you, Philippe, to talk to that announcement.

Yes. Thank you, Malcolm. It's been a long time coming. As most shareholders know, we've talked publicly about the option to list one day on NASDAQ. And we've taken the moment when we believe that the company is sufficiently mature to make that transition. And in essence, we need to be there with the current and the future economic activities will take place. Unfortunately, we've never had a commercial footprint in Australia and North America will be our largest future market. So we will need to have a feet on the ground. And for this, we expand our U.S. market access team, commercial team and clinical teams, and we'll make it our headquarters on January 1.

Now if you add to it the makeup of our registry, the ownership of this company has always historically been in foreign hands, 70% North Americans, Asians, Europeans and only 30% Australian. And that shift has never really taken place in favor of the Australian owners. So we've long prepared the company for a U.S. listing. We made that public, so there can't be any surprise. The depth of the U.S. market is well known in life sciences. And I also need to devote a few words to the Australian analysts because it pains me to see how much time they've spent on CLINUVEL, the hours, the number of reports since 2019. But we believe that the company is now mature enough to have a place on the NASDAQ Global Select market.

Important and questions that we received, what happens to the IP. Well, most of the intellectual property resides outside Australia, in the U.S., in Europe, in Singapore, where our research center has been located. Then vitiligo, of course, is a global disease. However, vitiligo is most prominently treated in North America, in the United States. So this is an additional reason why we need to be there as of January 27. A comment was received as why CIL is seeking a single listing and not a dual listing. And the answer is for companies that have a considerably larger size than, it would make sense to split the liquidity and volume traded. But in our size at the moment, it makes sense to have one single listing on a U.S. exchange where we devote all our resources, compliance and personnel to it.

If you look numerically for the reasons why we opted to do that now, in 2020, we traded a value of $1.7 billion annually, and that has receded to about $320 million in 2026. So we've seen a decline in traded value and therefore, volume in the CUV stock. So in essence, we base ourselves where the chance of value creation is the highest and where one commands a valuation multiple, which is higher than normally in Australia but closer to the intrinsic value of the company. So these are the reasons, Malcolm, in a nutshell.

Okay, Philippe, thanks. I'd like to turn to our pipeline. But first, just speak to our strategy, which has been to build and apply our expertise in melanocortin-based treatments for unmet needs. And we've certainly achieved that with SCENESSE EPP. And I think as the participants of the call know, we're working on other indications. We've made a leap forward on delivery methods, particularly on how we administer peptides, arriving at controlled release formulations. And this has been a keen interest of many shareholders and some analysts as well, not just in questions submitted to this webinar, but questions over recent months since we announced the progress of the liquid formulation peptide platform.

And we can tell you that we started this development, this in-house development many years ago, attracting talent, progressing the development, and we now have sufficient comfort to proceed to small-scale manufacturing dependent on progress, large-scale manufacturing is a potential. So these are all calculated risks, but we believe they hold more value than anything else we've ever done in-house. However, and pipeline is on screen for people to see, the immediate lead program is vitiligo. Now dependent on the results, and we will know that those results over time, that will determine the pathway to file for marketing authorization. But I wanted to bring Emilie in to talk more about vitiligo.

So Emilie, I thought you may have dropped off. Are you here?

Yes. I'm here, Malcolm.

I'm so relieved because I want to hear you talk about vitiligo. Please go ahead.

Yes. Absolutely. I apologize for the coming off and on the screen. We've been this by a storm in the U.K., and I think it's distracted and disturb my Internet. So the sky is blue almost now. So I'm ready to talk about vitiligo. So vitiligo is a unique program, whereby the efficacy of the treatment is visible. So we do not rely on blood analysis or biomarker or x-rays in our trials, the efficacy of the treatment is visible, and we document this with light photography. When we started the program with the hypothesis that afamelanotide with narrowband UVB agent would dig on vitiligo, we saw the efficacy in the hands of 3 leading vitiligo experts in the world.

We are focusing our efforts on the patient population with the highest need for treatment, patients of darker skin color, [indiscernible] skin type 456 for whom the impact of the disease is the greatest. So as a reminder, afamelanotide alone doesn't work since melanocytes and receptors are not yet present and expressed in the vitiligo lesions. So we will always need light therapy, narrowband phototherapy to be adjunct to the drug. And light therapy at narrowband UVB is the standard of care for vitiligo and the [indiscernible] are available in many of U.S. centers.

The competitive landscape has much evolved from the time we signed up this first proof-of-concept study back in the Melbourne office and where we were the only company in the world developing a treatment for vitiligo. You've seen that company now have started to reposition their drugs for atopic dermatitis or other autoimmune diseases, the JAK inhibitors in vitiligo. A couple of years ago, a topical version approved and very recently, last month, the first oral systemic JAK inhibitors by an American company approved by the European Commission and likely later in the U.S. by the FDA. So rise of the competitors and this opening of the vitiligo market is helping us enormously since the regulators are now becoming more and more familiar with the disease and the trial. So they do not -- they no longer have to look at afamelanotide with our narrowband UVB agent as a third dossier. They are precedent and benchmark. So -- and this is what we experienced at the time of scientific advice in Amsterdam with the EMA. So unlike EPP where we were first, there are advantages of not being first.

Another advantage and the big difference of afamelanotide versus JAK inhibitor is that we do not suppress the immune system acts as a natural ligand to the cell that produce the pigment. We mimic a physiological process. And in our trial, we need to demonstrate that afamelanotide with going to adjunct is providing faster and a deeper repigmentation. If I may use an image with afamelanotide, we have the foot on the pigment accelerator while the JAK inhibitors are taking the foot of the brake immune. Of note, JAK more and more are open JAK inhibitors are open to take too long for treatment effect and do not really work that well, and we expect to talk about that and about the results in conferences. And you may have noticed it yourself looking at the late Phase III trial results and top line results presented. The trials evaluating JAK inhibitors against placebo despite reaching statistical significance have quite a modest effect on repigmentation.

That's good. Now Emilie, we're going to move to catalysts. And since you're talking about vitiligo, that is to the fore of our catalysts. So can you please talk the vitiligo catalysts?

I will start with 2 significant milestones for our Phase III vitiligo clinical program. First, the top line results for the CV105 study and then the start of the CV107 study, both expected in Q4. A few words about top line results in CV105. We've been working internally and externally to retrieve and monitor all study data, generate queries, undertake cleaning activities as well as reviewing and assessing digital photographs. The study, the CV105 study has generated 110,000 photographs. The photography review undertakes 3 stages: first, a local review by the sites and physicians, then a central review by our clinical team. And lastly, an independent review by an expert panel, the central Photography Review Committee.

In overview, we look at both the extent of repigmentation, how much the patients are repigmenting, but also the quality of the repigmentation. And as we presented in -- at the AAD earlier this year in Denver, repigmentation follows a temporal sequence, first from the follicular response when you see little inside the lesion, brown islands, meaning that the patient is responding to the treatment to a conference where these small cones and islands become bigger and merge towards homogeneity. Homogeneity is when the vitiligo lesion is fully repigmented and the color is homogeneous with the constitutive skin. We call it color matching and it's very, very important from a patient satisfaction point of view. A brief note on AI. In parallel, our internal AI model that we presented at the AAD as well is ongoing training to support these activities in the near future.

Okay. Philippe, anything to add on vitiligo or the catalysts?

No, I think Emilie summarized it pretty well. There's not much to add. We are watching the market evolve. We witnessed the commentary on JAK inhibitors and the length it takes to see some effect. We also are looking of how these oral JAK inhibitors are going to be priced in Europe first and perhaps in North America. But in the meantime, we continue by training and accrediting centers and our target 490 trained accredited centers by 2027 is on track. So we are watching lead ins.

Very good. Look, thank you, Philippe, Emilie and Peter in reverse order of which you spoke, much appreciated.

It's now time to turn the call over to the analysts that are on the line. Now analysts, our briefing has been quite extensive. So please keep your questions seat. And we're going to start with David Stanton from Jefferies. So David, please ask your question.

I've got 2. Firstly, can you give us an update on your best guess as to when the CUV107 trial will read out, please?

Emilie, please?

I'm taking this question, David. Thank you. So CV107 from the start of recruitment in November 2026 to completion of the study, last patient last visit, the CV107 study is planned to run for approximately 2 years and readout will follow data cleaning and analysis, so expect 2029.

Understood. And second question about price. Should SCENESSE be approved in vitiligo, how would the differential pricing for SCENESSE be between the disease indications? And how would that be managed, please?

Yes. Philippe?

Well, there's no real surprise. I think let's take a step back for the general shareholders on the line. We are pricing SCENESSE and EPP on a bimonthly basis perpetually. So patients are on this product for life every year. And that gives you a value per patient per annum that is calculated and borne by insurance companies and state payers. In vitiligo, our assessment, depending on the biological variability that you see in patients, not everyone responds in the same manner at the same intensity -- it depends on the number of treatments that you're going to provide, but we assess that it's going to range between 7 and 12 implants per patient as a one-off treatment. So that's a one-off treatment in vitiligo versus annual repetitive treatment cycles. We also believe that vitiligo patients will benefit from 1 to 2 injections per year as maintenance treatment. And so the answer is that the value per patient in vitiligo is going to approximate the value per patient per year in EPP. So we don't believe that there will be too much price erosion. It will be more or less in the same ballpark.

Thank you, David. We'll now move on to Melissa Benson from Barrenjoey.

I had a question just on interactions with the FDA. I know with the vitiligo program, you've had EMA scientific advice. I'm just wondering like interactions with the FDA you've had, if you intend on having any meetings post the kind of CUV105 data at the end of this year or sooner? And also, I guess, understanding how much FDA input has gone into the CUV107 protocol?

Thanks, Melissa. I take your question. So yes, that's correct. We meet with the FDA following the top line results of CV105, which is after we commence CV107. Unlike any other vitiligo program, we are focusing on the use of a drug device combination, afamelanotide with narrowband UVB adjunct for vitiligo. And while the EMA interaction during scientific advice appeared supportive and then we agreed on many points for the program and protocol, we believe that the FDA will need to be presented more data during this Type C meeting. However, and in addition, the CV107 design aligns with many of the FDA requirements featured in the recent late-phase protocol for vitiligo that been which results have been presented or are in review by the FDA. So the design of this study is very much that we are mirroring the design of other systemic drugs setting up similar endpoints, [indiscernible]. With the FDA, we've come quite a long way from when they believe that narrowband UVB was dangerous and carcinogenic. Now they've learned that narrowband UVB is safe and doesn't increase the risk of cancer and vitiligo. So we are still in an education mode and need to present more data.

Could I fit in the second question?

All right. Quick.

It was just on the NEURACTHEL ACTH. We noted that you're ready for a filing with EMA in the second half of this calendar year. I guess, again, another question on potential plans for filing there with the U.S. FDA for that program.

Okay. Philippe?

Yes, it's correct what Melissa said. The sequence is Europe first, filing NEURACTHEL, the ACTH is a generic dossier. And then once we understand the questions that will invariably come from the European Medicines Agency, we will file in the European in the FDA. But we are filing the generic version of ACTH on a country-by-country basis, so not through a centralized procedure. But the FDA will follow after that.

Thanks, Melissa. So we have an analyst who's dialing in from a long way away, Frankfurt, Germany. We appreciate Thomas Schiessle dialing in. Thomas, please ask your question.

Could you hear me?

Yes, Thomas.

I have 2 questions. Indeed, the first one is on NEURACTHEL. Could you share with us your go-to-market strategy concerning the time line and the commercial effects in the new business year in '28? The second question is on PhotoCosmetics. I guess it's more -- it's a strategic importance to deliver the cosmetic line for patients. So what are your plans concerning the PhotoCosmetics, please?

Well, NEURACTHEL, I just spoke about. So it's a regulatory pathway through the mutual recognition principle. And then we choose the -- we have chosen a number of first-tier countries, then the second-tier countries and then FDA. And we know most of the prescribers for these hormones in the European Union. We know the centers, we know the indications. So we intend to distribute it directly to hospitals first.

I think your question on PhotoCosmetics is related more or less to the vitiligo program and why it's sequenced like this. First of all, I need to explain what our intention is and has been. We see vitiligo and many of the medical practitioners as the natural way of using a hormone to bring back pigmentation. In late terms, vitiligo is really -- and repigmenting in vitiligo is really the same as medical panning. Now if you are able to provoke, induce the pigmentation in infliction that needs that repigmentation, then the 5 decades-long quest from many cosmetic companies and was to use these melanocortins in a transdermal formulation in a topical formulation, a cream, a lotion and emulsion to make sure that these peptides could penetrate the skin and be retained in the epidermis and provoke a self-broonzing effect.

Now we've been working on this for almost a decade, like many other cosmetic companies. We've seen results that stand up, but we are not totally confident that the results we have seen in these formulations are commercial yet. So we are not ready yet to launch these products. And I believe that it is worthwhile pursuing the quest to eventually arrive at a transdermal formulation that can be applied twice a day over a number of weeks that would provoke the tanning. But we're not there yet, but that is the research effort that we put in. Does that answer your question, Thomas?

Yes. Thank you very much.

Thanks, Thomas. And it's a good question to ask because at least half a dozen questions from shareholders have been on PhotoCosmetics. So thanks for that also, Philippe. Moving to Madeleine Williams of Canaccord.

Just maybe off the back of Thomas' question. Vitiligo is clearly a big opportunity. In the next couple of years, what do you see happening in regards to the EPP business? Like what are your expectations for growth there, cognizant that there is some competition. But then also on ACTH and sort of other opportunities, I mean, what's your thoughts on what that growth profile looks like in the lead up to then the vitiligo reading out and being -- becoming commercial?

Philippe, can you address that issue of competition in EPP and how we will fare head-to-head with them?

Yes. Thank you, Madeleine. That word competition is so charged and loaded in the Australian market. We seldom asked that question overseas. Let's give a historical account. The first time that competition in EPP was mentioned was in November 2021. And we never had doubt internally that one day a competitor would enter the market. Well, since November '21, no one has yet entered the market. But it's logical in the cycle of developing and finding new diseases that you will not remain the first one.

The market of EPP patients, the pool of EPP patients worldwide is well known by us, by patient advocacy groups, by companies are developing new products for it. And by and large, you can say that every year, there is a percentage of new patients reporting their disease to general practitioners, dermatologists. And we see that in the growth numbers in the new patients added to our pool of treated patients in Europe and U.S. If you look at a finite number of patients, then we, as a company, calculated what is our penetration, what is the number of patients that are on treatment and remain on treatment and how many of these new patients are actually enrolled in other clinical trials. So in 2025, '26, we saw 3 companies running clinical trials, Phase II and Phase III, ranging from 50 to 175 patients each. And while these trials were conducted, [indiscernible] was growing its number of patients.

And so in spite of what Peter reported over the financial year '26 ending June 30, we are privy to information firsthand from our market access team. And if I look at the pool of patients, the number of treatments supplied between January 1, 2026, and 31st of July '26, we are growing the number of patients and number of treatments in Europe and in the U.S. in spite of 3 other companies running the clinical trials. So mathematically, you understand that there is space for 3, 4 players without actually eroding yourself. And then there are many other diseases that are treated by pharmaceutical companies and products that see the same pattern. So I understand the anxiety of many.

But so far, there is, from our point of view, no reason to share that kind of angst. The treatments are growing. The number of patients are growing, the number of patients remaining on treatment growing. But yes, we saw a slight retreat where competitors were giving free drug free of charge patients. But at the same time, we also see some of these patients coming back. So we believe that the EPP market will continue to grow and probably not double digit, but single digit. And I think Madeleine asked a question about the size of the market of vitiligo in Europe and U.S. that correct?

Certainly, some shareholders have. Can we reserve that to the shareholder questions?

Yes, but I want to answer Madeleine's question. Madeleine, can you repeat the vitiligo part?

Just as it relates to the question that I asked with vitiligo was just kind of what was the expectation around the growth between now and then. So it wasn't directly about vitiligo, but I'm more than happy to hear the answer.

The conundrum is always that when you present a business case, everyone emphasizes the first-mover advantage and being the first as the -- in our case, actually, it's really good to be the second. We've been the first in EPP, but being the second vitiligo means that others need to do the work with regulators and insurance companies, and we will benefit from it. I think I've said publicly and some of our officers have said I think publicly is that vitiligo, in our view, will follow a pattern that you've seen in oncology. It will be a combination therapy and maybe a double or a triple therapy where you need end the light and the JAK inhibitors and the ultimate pigmentation agent afamelanotide. So the oral JAK inhibitors are for now the only thing there is that we understand from the medical community, it's not the panacea. It's not the drug they hoped for. It takes too long. Compliance is an issue. The suppressing of the immune system is an issue. So we continue to develop that market, and we're pretty hopeful to reach it.

If I could also suggest, I think more competitors in the market also helps to bring the prevalence of the disease to the floor as well. So other sufferers out there learn about the disease that they might be suffering from that they haven't been diagnosed with. So I think that also helps to build a base of population as well.

Okay. Sarah May has been waiting patiently. Sarah from [indiscernible]. Please ask your question, Sarah.

Can you hear me?

Yes, indeed.

So my question is just on the controlled release injectable liquid peptide platform. As you kind of do more work there and develop the product, can you just talk us through where you see the ideal initial applications being and what the steps are between now and bringing that to market?

Good question. Philippe, please.

Well, that's a difficult one. So Sarah goes I would say, first, the handicap of a research-oriented company, certainly a public one is that it cannot reveal everything it does. You do that because you want to shave yourself from competitors. You don't want the information to be out too fast. You want to have certainty on the data and the competitive results, but you also want to gain and keep an advantage over future competitors. So I will share with you a rationale for most shareholders to follow a thought process, and then I will let you fill out the blank dots. A company that spends a decade or more on understanding the behavior of peptides in human biology, how peptides are optimized in terms of side effect profile, in terms of release, in terms of pharmacokinetics, dynamics, attracts a team and that team stays together and the team gets better at it. Most experiments fail. But from the failed experiments, you hope to incrementally learn and progress. So it's 2 steps forward and one step back. And that is the nature of our industry. And every time you as management and as Board, how we continue to invest and fund these kind of research projects and experiments, yes and no, and what is the ultimate market.

From the knowledge of peptides, our team started to understand the optimum way to deliver these peptides in human body. And you can do it by injection, you can do it orally, you can do it by cream. You can do it rectally. We found through our work and through the afamelanotide product that we mostly developed with a contract manufacturer that sustained release, controlled release gave significant advantages over any other formulation. So naturally, from peptide knowledge, we went to delivery knowledge. And we said many times in public that technology is important, but most important is to find the talent that can do something with it and to retain the talent. And so we found some key people in the world, built labs around them in Singapore, and they started to expand their teams and become experts in platform delivery.

So from a single product peptide, you learn the skills how to optimize the delivery of this peptide and other peptides. And we are coming to a stage where we have sufficient confidence to understand that there is a commercial market for us. And so what we are doing is we are building new facilities in Singapore with upscale capacity, so to experiment and manufacture at larger scale with the assistance of the Singaporean government that clearly has seen the prospect and the market size that we're trying to target. And so I understand that Sarah wants to hear which peptides and how. It's a bit premature to say it, but it suffices to say that we believe that, that business will be bigger than anything else we have ever done, and that justifies the funding. And that is the excitement that we all have. And probably the single reason why the CSO and continue in this business is we see the data, we see the readouts. We see the teams getting better at it. And we also see that there's very little competition in the world. So from peptides to delivery platforms is probably the most exciting part I've seen in this company, notwithstanding the vitiligo opportunity, but we understand what we're capable of and what this would lead to.

Well, something exciting to continue to track Sarah. Was Peter, were you going to add something or not? Okay. We'll move to Thomas Wakim from Bell Potter. Thanks for being patient and waiting Thomas.

Just want to follow up on EPP. So you mentioned in the U.S. is a bit of impact from some of these alternative products. I just want to, I guess, understand a bit better, firstly, why some of the patients who are on SCENESSE seem to be switching and trying some of these alternative therapies. And secondly, if any of them do eventually get formal approval, do you expect those pressures to continue to intensify?

Philippe?

Again, Okay. I don't have the crystal ball, but I don't think the pressures will intensify. It is what it is now. Some patients will prefer to stop at the petrol station every 2 months rather than refilling every day. I mean I'm very skeptical about using anti-schizophrenic drugs in EPP because it gives central nervous effect. I'm very skeptical in synthetic compounds that haven't been used and tested for a long time as opposed to a drug that is administered every 2 months and has been used for 4 decades. But God knows what the market -- how the market will evolve. But in general, as I said before, I think there is too much emphasis on the competitive pressure. And it is true what Peter says, not only in our case, but in orphan diseases, more attention to patients means that more patients will come out and seek diagnosis. And normally, it increases the pool of patients available. So we're pretty calm about this.

Thanks, Thomas. Mark Pachacz from Bioshare. Would you like to ask a few questions, Mark? Well, has Mark had depart?

Can you hear me now? I think...

Mark, yes. Yes.

Two questions. One for Emilie is reasonably straightforward. In vitiligo, so I'm just getting some feedback here. In vitiligo, the duration of effect, how important will that be to measure?

Yes. Sure. So Mark, by the duration of effect is duration of effect or what I call maintenance of repigmentation achieved. So indeed, that's an extremely important consideration. And at present, while treatments on the market or narrowband UVB or some JAK can provide some repigmentation, the effect doesn't last and patients lose their pigment after they stop the treatment. So in our studies, we are comparing treatment effect and maintenance of repigmentation against narrowband UVB as a monotherapy. And we have also interesting observation from the 105 study that we presented in our case studies where we see patients continuing to repigment after stopping the treatment with afamelanotide. So there are positive signs towards sustained repigmentation with afamelanotide and narrow will be adjunct. And as Philippe mentioned earlier, when addressing pricing, the way we see treatment in the future will be as a course of treatment and then afamelanotide being given ad hoc as a boost at [indiscernible] to maintain and to keep the treatment effect.

Okay. Philippe, I have a question about NEURACTHEL. So how many competitors are there in the market at the moment? And when can meaningful revenues be expected from Europe?

I would say that there are about 4 competitors in the market in ACTH, a larger one serving the North American markets and small ones in Europe. We can only give guidance on meaningful revenues the moment we know the turnaround time by the EMA and the national competent authorities. So we don't have color on that yet. We know that the average turnaround time should be 12 to 16 months after filing a dossier, but there are a number of clock stops in it where they ask questions and answers are provided within 4 weeks. But that's a bit too early. The moment we know how we sail through the review process, we will provide guidance on when we expect the first revenues for ACTH.

Just a follow-up there, Philippe. Are you -- on approval, are you accepting reasonably rapid penetration into that market?

Yes, I would say so. Because as you probably know, ACTH is a drug with a label for 19 different diseases. That means that the drug can be used for 19 different therapeutic indications, but it's also used as a diagnostic. The majority of these diseases are not yet being treated by ACTH. But it's a compound that has a diversity of therapeutic effects and that appeal to us.

Thanks, Mark, and thanks to all the analysts. I think we are a bit over time, but I do want to cover a few shareholder questions. Fortunately, as we've gone through competition in EPP, NEURACTHEL, PhotoCosmetics, what am I forgetting many questions on vitiligo. We've answered them, and that's satisfying, I hope, a number of shareholders. But I want to round out the webinar with a few questions, one from Mr. Kefler and Mr. Singer on vitiligo TAM in Europe. one from Mr. Waller on Board and management market buying of shares and total insider ownership of the company. And whilst it's not a typical area of our commentary, there are many interested in Philippe's views on the share price. So Philippe, why have we not yet scoped vitiligo TAM and presentation in Europe since that is a regulatory market we're destined for as well as well as the U.S.?

When you talk about TAM, the total addressable market. Yes, sorry. Vitiligo in Europe is treated mainly by expert centers by not by every single dermatologist. The treatment guidance for vitiligo in Europe is slightly different than it is in the U.S. And the population is more diverse, I would say, in the various 27 European member states. So from the market research, there is such diversity in the size of the vitiligo market that we don't dare to put it out there because the range is too large. We have an idea what the addressable market of vitiligo can be in Europe. But we try to stick with the lowest number. It's very different than in the North American market. So it is sizable, but the range of patients reported with vitiligo in European Union is so vast that we don't want to give a number to our shareholders.

Okay. Moving on to that second question. Yes, go ahead, [indiscernible].

Apart from your substantial ownership, Philippe, some of observed members of the Board have low to no ownership of CLINUVEL. So whilst it's their own personal prerogative to determine their own investment strategy and what they invest in. Could you comment on insider ownership? Is that adequate? Do you think it needs to be higher as some shareholders sometimes suggest?

I understand the question and the ownership of this -- of insiders, including officers, managers, executives is about 11%. I own just under 7% of this company. Directors come and go. Some of them buy on market, some do not. I generally see that as a sign of confidence, but we don't ask them proactively to do so. I think it's, as you said, the prerogative of every director to make that decision. And it's been higher in the past and it's also been lower. So it will evolve. I'm pretty certain that as the company evolves and moves into new territories, the directors will seize opportunity.

Okay. And your views, even though as I said, it's not something we typically do, your view on the share price. It's been quite volatile. There has been a declining trend. There has been some improvement in recent months. I know in 2026, the decline over the year was minor. Your views there, please.

Well, first of all, I've spoken at 2 AGMs about share price. I find it unusual for managing directors to talk about the share price of their own company because by and large, every CEO will think that it's too low. If you look at objective metrics, and that's the only comment I will make, and then I really wish that we didn't talk about share price of this company anymore, at least not me. If you look at objective metrics, price to book value, price earnings, forward price earnings, we can -- and I leave the analysts to do that, take a view of whether it's fairly priced or underpriced. If you benchmark it in various markets and you look at the valuation multiple of CLINUVEL to other companies, you can also form a view whether we are fairly priced or punching above our weight or underpriced.

What I do know is that sentiment also drives markets. And for that, I point shareholders to past events in the company where it was leading up to a regulatory outcome, EMA or FDA and then you see slowly the share price moving up as people are taking the bet a binary bet whether you get an approval or not. But as soon as that binary bet is taken and the outcome is effective, you also see the share price drifting. So that kind of volatility is probably specific to Life Sciences where you have these important catalysts. You will have it probably more in the smaller markets and the larger markets than in the U.S. market. But I am -- in generally, I am confident that when a company diversifies, when it provides data that instill confidence in the market, when the gap between what we know and the knowledge that shareholders are able to know at a given point in time when that gap is closed, that the share price will be higher than it is now.

Thank you, Philippe. I'm now going to close the webinar. I want to thank Philippe and Peter and Emilie for your enthusiastic participation, all analysts for their questions, much appreciated and all participants for hanging in there and listening to every bit of what we can impart on the company and its outlook. The link to this webinar will be announced to the ASX. And I think we had a few technical issues where maybe a slide wasn't put up early, and we'll try and fix that. It will also be on CLINUVEL website as soon as possible. So thank you.

We take many things for granted in life. And in good health, I think it's important to get up with appreciation. I very much express my appreciation to the analysts on the line who voluntarily follow the issuing the report. And we don't take that for granted. Thank you.

Yes. Thank you Philippe. Thank you, everybody. Best wishes to all.

Hello, everyone. Thank you for joining CLINUVEL's Investor Webinar. I'm Stella of Monsoon Communications. In today's webinar, CLINUVEL will share their half year results and operational highlights for the 6 months ended on 31st December, 2025.

I will now hand over to Malcolm Bull, Head of Australian Operations and Investor Relations, to conduct the proceedings.

Thank you, Stella, for the introduction. I'd first like to welcome members of CLINUVEL's management team to the webinar. Not surprisingly, reflecting the focus of the webinar on the financial results for the half year to December '25, we have Chief Financial Officer, Peter Vaughan. We are joined by 2 executives who are leading the business in key operational areas: Director of Clinical Affairs, Dr. Emilie Rodenburger; and Director of North American Operations, Dr. Linda Teng. We're also joined by our Managing Director, Philippe Wolgen.

I'd like to acknowledge there are several analysts on the line who cover CLINUVEL and we'll ask some questions in the webinar. It would be remiss of me if I didn't say on behalf of management and the Board that we appreciate your work on CLINUVEL, your role in telling our story to a wider audience than we could reach ourselves and your involvement in this webinar.

It's pleasing also that there are over 175 participants to the webinar, reflecting increasing interest in CLINUVEL. So welcome, one and all.

Before going further, I think it's appropriate to highlight why we have 5 executives in today's webinar. So you frequently see Philippe; our Chief Operations Officer, Lachlan Hay; Peter Vaughan; and Investor Relations presenting the company to a range of stakeholders.

We have received feedback that it would be good to have greater access and the opportunity to hear from other executives. So for today's webinar, noting this is not the forum for a strategic review, but as a courtesy to you all, we include Dr. Rodenburger and Dr. Teng to answer questions and provide their insights direct to you.

Today's webinar will be in 2 parts. First, a discussion of the half year results; and second, the analysts online will be called upon to ask questions of the CFO and management.

We will be talking today about plans and intended outcomes. So I'll draw your attention to the forward-looking statement or safe harbor statement on screen that identifies a range of risks that can materialize and impact their achievement. So I think 10 seconds to review that is enough, and that is on our website and on all of our announcements.

I now kindly invite the CFO to summarize the results. Peter?

Thanks, Malcolm. Good evening, and good morning, everyone, from wherever you're calling in from. It's another set of very consistent results at CLINUVEL, I'm pleased to announce, with our revenues up 4% on the prior year, maintaining a steady growth pattern.

Our expenses were up 22% for the period, and this really was part of the supporting the expansion initiatives that we'd foreshadowed previously that we were going to be undertaking during this period.

We continued our strong positive net operating cash flows, and this saw our cash reserves over the 6 months increase by $9 million to $233 million. We're closely monitoring all of our expenditures and any discretionary spending is being scrutinized really closely. And the good news is that our profitability for this period, whilst lower, continues to be maintained despite the increasing level of expenditure during this expansionary phase.

Thanks, Peter. I'll now ask Philippe to comment on the results.

Thanks, Malcolm. Welcome to all the analysts and shareholders. Well, in a nutshell, we follow a plan, a strategy, which is gradual and with purpose. And for this strategy to play out, we need to manage our finances tightly in a very controlled manner. In the past 12 months, we intentionally increased our expenses. And therefore, naturally, one expects to see the net profit decrease. These expenses towards R&D, the clinical trial in vitiligo and regulatory filings.

We are very much in line with our own forecast, so we're content with the results, and we will proceed on this basis. And with positive cash flows, we can expand the activities of the company, the group.

We gave expense guidance from 2021 to 2025. And for the financial year, we expect to spend about $55 million to $58 million, excluding the capital expenditures. So in summary, the business model we chose is playing out really well.

I agree. So let's delve into the results and call on Peter to look at in turn revenues, expenses, profit and indeed the balance sheet.

Thanks, Malcolm. So our revenues for the period continue to grow year-on-year. And this period, I'm pleased to say we saw our highest ever sales revenue result.

This period marks the 20th consecutive profit for CLINUVEL since the commencement of our commercial operations. And our expenditure, as I touched on before, whilst increasing, is very focused, controlled and targeted around the specific areas of the business that we're focusing on.

Our expansion saw key developments in our R&D activities across our ACTH-NEURACTHEL program; our vitiligo study, CUV105; and of course, our peptide drug platform that we developed at our Singapore Research Development and Innovation Center that we recently announced we'll be undertaking a large expansion of.

Now all of this expenditure and all of this growth has been achieved without sacrificing our overall profitability, which is really a fantastic result for the organization. Only 4% of biotechs deliver a profit and even fewer are able to sustain a profit for an extended period of time. So where CLINUVEL has done this for over a decade, it's truly a remarkable outcome.

In turning forward to our revenues, specifically, we saw our revenues from sales increased by 4% from the prior period to just under $37 million. As I mentioned before, this is our highest first half year sales results we've ever seen.

This reflects the increasing and continued demand for SCENESSE right across our sales regions. In particular, we saw strong growth in volume of sales across Europe. And as we announced in September 2025, the approval by the EMA, lifting the number of maximum implants per year from 4 to 6, has already seen some of the patients take up that extra initiative, and we expect other patients to follow suit as well.

In the U.S., our team and -- led by Linda has able to increase the number of sites to meet the target that we had for December, which was 120 sites across North America. The patient demand has been consistent throughout the period, and our U.S. team operates extremely well given the evolving U.S. medical reimbursement landscape that is constantly changing at the moment.

Perhaps at this point, Linda, as our Head of -- Director of North American Operations, I might ask you, could you provide some insight to the people listening in around the U.S. reimbursement process and in particular, the prior authorization scheme that enables us to have such a high success rate of reimbursement?

Sure, Peter. So first off, please excuse me for my raspy voice, as I'm still recovering from the flu. But thankfully, the technology allows me to share the insight without spreading the flu.

Linda, we can't hear you well. Linda, we can't hear you.

Can you hear me now?

No. It's very muffled.

Go off the headphones if you can.

Is that better?

No.

Not really.

Is that better? Can you hear me now?

Yes. Much better. Okay, let's move on.

Yes.

Can you now hear me?

Yes. Okay.

Can you hear me now?

Yes. Please proceed, Linda.

Yes?

Yes.

Okay. So all right. So we're going to continue with what Peter said about prior authorization. So in short, basically prior authorization is a way for health insurance companies to control their cost, by making sure that they are only paying for treatments that are medically necessary for their patients.

And so because SCENESSE is the only FDA-approved treatment for EPP, and it has a strong and also a long-standing safety records. We haven't seen any prior authorization denials for the EPP patient.

And we also have a dedicated in-house team that works very closely with the physicians to really streamline the submissions and also speed up the approvals. And for SCENESSE, most of our PAs that are already approved, they are only renewed annually. There really is minimal paperwork for the physician, and so they don't have to get approval for every single treatment visit.

And for those who are familiar with the U.S. healthcare system, you might notice that our approach is very unique. Most high-cost drugs, they go through the middleman or the pharmacy benefit managers or we call them the PBM. And they usually drive up prices up even more. So we made that deliberate decision to avoid the PBMs.

And I think that is moving like a smart moves, especially now because the government is increasingly the scrutiny of them. And we said the 2026 Consolidated Appropriations Act, which has really signed into law a few weeks ago, including the provisions aimed at the PBM industry.

And as for the patients, the feedback has been consistently positive. And I think the reason for the continued treatment year-after-year is because they are seeing real clinical benefit. And we even saw some patients are increasing their treatment dose within the year because of the clinical benefit.

And I do want to be clear that we don't pay physicians or patients for any testimonials. Everything is completely organic. The feedback from the patients are voluntary and genuine. And usually, they can share more within -- happily within their patient communities or directly with my team.

So I hope this gives you some insight into our prior auth process. Peter, handing back to you.

You're on silent, Peter.

Thank you, Linda. As we look forward to the other areas of revenue for the period, our interest income was up to $5.3 million this period, which was a 14% increase on the prior year. And this was really the result of a larger cash reserves balance that we continue to maintain.

We generally take our surplus funds that we have at the time and invest them into term deposits to help to build and grow on that balance. And at the moment, we're extending the length of our term deposits to be able to take longer-term maturities at higher yields. So we're seeing our average term deposit for about 300 days at the moment, and we're receiving an average yield of about 4.5% across the portfolio.

Our other income, now this number has swung the other way from the prior period, and it's a difference of about $4.6 million. Now just to explain, this is an unrealized foreign currency translation that occurs each balance date, so each reporting date.

It's really a non-cash transaction that's effective at balance date for accounting purposes. And it takes the process of taking all of our foreign currency balances and bringing them back to account at balance date into Australian dollars. So it's not a real loss. It's an unrealized loss just purely to be able to balance the books at balance date.

So if we look at our revenues overall, I would mark them as being stable, growing and also consistent. Historically, our second half of our financial period generally tends to be proportionately higher from a revenue perspective, with the EU and U.S. summers coming into effect through that second half of the year. So we're really excited to see how the second half of the year plays out given we've still got that maintaining growth.

Perhaps moving to expenses, Mel, now more specifically.

Yes.

So we saw a 16% increase in our personnel expenditure. And I'd probably -- I'd just like to provide some context around that for everyone to understand. This is a strategic part of our expansionary team and increasing the in-house capability of CLINUVEL.

It provides greater control and oversight of our activities. But at the same time, we're upgrading the skill and expertise within our organization.

Now as everyone will know, skill and expertise within the life sciences sector is really important. And recently, we've seen regulatory challenges and hurdles that some other life sciences and biotech companies have faced in just recent times. So this highlights the need to really develop and create the skill and expertise within that team and make sure we've got the right people around the decision-making process.

And when we look at CLINUVEL, CLINUVEL's never had a market authorization knock back in over 20 years of being active in the pharmaceutical sector.

Now if that was to occur in some shape or form, a regulatory rejection of some sort can really have a significant effect on an organization. It erodes shareholder and market confidence in the company. It raises doubts around management's decision-making and assessment of processes and events. It can push commercialization time frames back up to 3 years as seen in some of our peers where another study or more data may need to be gathered before a resubmission can take place.

And clinical trial designs and endpoints around the quality of data may suit one region, which brings in revenue, but not always both revenues -- both regions to bring in revenue across the globe. And this can really affect the total revenue pie that's available from the advancement and the approval.

Our people are really critical to the process. And in plotting the path forward, we're really confident that they'll be able to obtain the right outcome around our clinical programs.

In turning specifically to our clinical and non-clinical expenditure, the expansion of our CUV105 expenditures was somewhat offset by the orderly wind down of some of our earlier phase programs. We've reallocated and focused our resources towards our later stage and strategically significant programs aimed at achieving the nearest-term commercial results and prospects we can.

Preparation for CUV107 has already commenced and is well underway, and we'll start to see those expenditures flow through in the second half of the year also.

Commercial distribution, if we look at that area, that was up 42%, but this is predominantly off the back of increased volumes of shipments, particularly in Europe, as I touched on before. So it's all increased proportionately. There has been some temporary one-off costs that have been associated with some transitions that we've made in our supply chain to some of our warehouse providers to ensure the long-term stability of that supply chain as well as being able to scale with us for the future.

The other area that is somewhat affecting the commercial distribution area is also some of our regulatory fees. Previously we used to sit under an SME discounted scheme in some of those regions for the FDA and EMA annual fees. And now that our revenues have increased to the point that they are, we're no longer eligible for some of those discounts, so we're having to pay full annual service fees now to those organizations, which is also increasing the expenditure in that area.

The next area to touch on is really finance, corporate, and legal. Now this did increase proportionately from the prior year to up 47%. And really, this is the direct cost of a lot of it is being our ADR program uplift from Level 1 to Level 2 that I'm sure you're all aware of as we uplift that program for the U.S. to list on NASDAQ.

There's been a substantial amount of work undertaken across that area by the finance team, but also in conjunction with our accountants, auditors and legal firms, both here in Australia and in the U.S. And this process we had to go through undertook a 3-year reaudit of all of our financials into U.S. GAAP -- converted into U.S. GAAP financial presentation, and then that was submitted to the SEC for review.

Our other expenses, that's up 191%, and it's predominantly driven by the increase in our R&D programs and all the consumable materials that we use within those programs, whether it be ACTH, PRENUMBRA or NEURACTHEL, any of those developments.

Our non-cash expenditure was down for the period. This is usually a change in our inventories in our balance sheet differences from period to period, that's really what reflects quite a bit of that expenditure. This period, that's a lower number than it was previously because we've actually increased our manufacturing during the period, so therefore, there hasn't been as low a drop in our inventories. It stayed more on par.

Our share-based payments have also been much lower this period than in previous years, and we recently changed our share plan at the start of 2025, which meant the expenditures will now appear differently, but also it's now a 1-year plan instead of a 3-year plan.

Now I've spoken fairly at length around all of the expansionary activities that we're undertaking and some of the critical advancements to our program. But this expanding expenditure should really be seen as an investment in the organization rather than just being pure expenditure.

So from a financial perspective, it does take time to build up these resources internally, but it is cheaper than outsourcing to a CRO. CROs can add 25% or more costs to the bottom lines of a clinical trial program. But by having that skill and expertise in-house, it's critically important for us to maintain that control and oversight of the program.

We've got Emilie Rodenburger on the call, who's our Director of Global Clinical Affairs. Emilie, in speaking around our expansionary activities and what's been undertaken, I guess, would you be able to provide some insight into why that was necessary? And what are the specific advantages of doing them in-house?

Yes, absolutely, Peter. I can give some additional context to the numbers. So first of all, good morning, good afternoon, good evening, everyone. It's good to be here.

In my capacity as Director of Clinical Affairs, I really think more on the deliverable and how to achieve them, but it certainly ultimately impacts the numbers we report.

So clinical expansionary activities are twofold. It's talent growth and building the infrastructure into which the talents operate. As Peter mentioned, the company has taken a conscious decision to build our capabilities in-house, which is not the norm in our industry. Where most are relying on outsourcing their studies, we have chosen not to rely on these models and not to work with CROs. It increases cost and can result in loss of control and oversight over studies and data.

In order to deliver the CUV105 study, we had to invest in new talent and these professionals will be retained through the CUV107 and beyond. Currently, the clinical affair department that I lead is the largest department in the company spread across U.K. and U.S. with a great range of expertise, operations, data science with data management and statistics, and medical affairs and clinical quality.

In addition to bringing new talents in, we have also trained and upskilled existing talent. So building and retaining the expertise in-house. And again, I repeat what Peter said, it's really critical for the health of our business.

In terms of infrastructure, it's really the processes and the systems, and we've also been investing in this. This investment will continue further for us to be able to manage a significant data set that are coming from the vitiligo studies and deliver efficiently on the studies.

So when we build in-house, we both supporting the present and investing for the future. I mentioned the talents, the expertise, the ownership, processes and systems. They can be seen as a platform assets that is transferable to any studies and programs that we will be conducting in the future. So in a way, we're building a CRO in-house.

Excellent. Thank you, Emilie. In turning to our balance sheet, Malcolm.

If we look at our balance sheet, it keeps going year-by-year from strength to strength. As I touched on, our cash reserves increased by $9 million to just under $233 million, and it's the highest cash balance we've had in the company's history.

Our net assets have also increased by $8.2 million to just under $250 million, which again is the strongest point in the company's history. And we remain debt-free for the 21st consecutive year with no equity dilution since my March of 2016.

A strong balance sheet with positive net cash flows is really a strategic priority for CLINUVEL as it enables us to see clinical programs through to commercialization without any additional funding required. It also provides resilience for any unforeseen events or economic uncertainty, particularly in the current geopolitical times.

It provides flexibility to ensure expansionary opportunities, acquisitions or investments that align with our objectives, can be taken advantage of, which many peers in the industry aren't able to consider without having to raise additional capital.

It also enables strategic objectives to be delivered such as the expansion of our Singapore research and development facility, which we've slated for over the next 5 years to provide vertical integration of ongoing peptide and formula development and innovation.

A number of our peers have recently announced capital raisings, some as much as at a 45% discount to market to fund these sorts of activities that we can take on and that we can develop without having to raise any further capital.

Some of these peers are raising for clinical program developments, for raw material supplier scale-up or for product rollout into a new jurisdiction. As already touched on, CUV is funded for our full clinical trial program for vitiligo.

Thanks, Peter. I mean that was a comprehensive overview, I must say, but I'd like now to move to strategy. I mention and shared with you that a number of institutions, particularly in the U.S. have asked us why CLINUVEL stands out in its strategy. They even ask, are we a bit dogmatic and a bit rigid in our strategic focus and execution. Philippe, can you comment on this?

Well, I'll pick up the 2 words: dogmatic and rigid. The contrary, we've built in the flexibility and optionality in this business model, and that allows us to navigate markets and cycles in pharma.

But the objectives are really clear, they're fivefold. We need to expand the EPP commercial market, advance the vitiligo programs as a focal point of the company, advance the NEURACTHEL dossier, which is a large opportunity in the use of ACTH in a number of indications, advanced PhotoCosmetics, and bring in-house the manufacturing of the new and next formulation.

So in any given business model, there are a number of options. We can serially raise funds like most of our peers. We can change the business strategy altogether, step away from melanocortin and do something totally different. We can self-fund the program starting gradually as we've done.

And the fourth option is, we can cease operations and say, ladies and gentlemen, it's too difficult, it's too hard, and let's give the cash back to the shareholders. And we haven't chosen that because we believe that there are a number of opportunities that we worked on for decades that are worthwhile pursuing.

And there are a number of underlying assumptions that the Board and management take into account that we are privy to and no one else is. And first of all is, are we conducting an honest genuine business, no one indicated in further activities. Do we keep the teams in check? Do we have technologies that are safe and work? And third of all, do the patients -- do the investors have the patience to see out the strategies?

But the most important underlying assumption is whether there is perpetual funds available for this company. And we've come to the conclusion that this model is very appropriate for the way we need to reach the vitiligo and the ACTH markets.

So in summary, Malcolm, we needed to accumulate these funds to execute a program, which we all believe will lead to a sustainable multi-dollar a billion-dollar enterprise. But we also need to be conscious of the realistic risks that evolve around clinical, regulatory and execution. And for that, you need to have optionality and optionality is cash. And that will eventually lead to a diversified company. So that's how the company stands out.

Thanks, Philippe. So moving to another area where we've had numerous questions, and this is on the readout of vitiligo. And Emilie, it's good to have you here, and this is where you come in. What can you tell us about the regulatory process and path to market on vitiligo?

Thank you, Malcolm. I will address your question by providing a number of specific observations that support the regulatory process and path to market for SCENESSE in vitiligo. Some of these observations are unique to SCENESSE and some you might also be familiar with, but allow me to go through them.

The first one is SCENESSE is already on the market for another indication, EPP. It's a product for which we have accumulated 2.5 decades of safety data and a safety profile that has been maintained over time. The regulatory agencies know the product well from the Annual Report or regulatory and pharmacovigilance teams are and have submitted for 1 decade now.

In regards to vitiligo, vitiligo is a condition with visible symptomatology and the treatment effect -- skip that one. And the treatment effect that we desire, repigmentation, is visible. So from the cases we received and cases published by physician, one can gain much confidence that the effect of the treatment are visible.

From an operational point of view, the trials can't be blinded. The work -- the drug either works or not and physician and patient can see the effect very quickly, the visible efficacy. So what I'm trying to say here is that in vitiligo, the photographs do not lie. And part of the analysis is to have centrally assessed photographs up to 32 per patient, which is up to 6,000 assessments. Very importantly as well is the patient experience and how they appreciate the return of their pigments.

JAK inhibitors, some currently in Phase III, one recently submitted to the EMA and FDA for marketing approval, they take a long time to work, thereby suppressing the immune system. And last but not least, we are living in a very dynamic regulatory landscape where the concept of generating clinical evidence is evolving.

EMA speaks about totality of evidence for drug approval, while as I'm sure you've seen the FDA recently announced that single trial will now be the default for drug approval.

So what I really wanted to convey by all of this is that, these are positive considerations for SCENESSE to come to market for vitiligo, as we are continuing on the same trajectory. I can't tell you exactly when. But for sure, vitiligo is the natural home for afamelanotide, a pigment activating peptide, which is an analog of hormone that's naturally produced by our own body. Thanks, Malcolm.

Thanks, Emilie. So before we go to analyst questions, all stakeholders want to know what's next. Philippe, can you summarize that for us, please?

Sure. So there are a number of catalysts that we're approaching over the next 2 years. The most immediate ones are the top line results from vitiligo CUV105 in the second half of 2026, the start of the vitiligo CUV107 study, and the preclinical results on the peptide formulation in the latter half of this year and the listing of the ADRs on NASDAQ that we await the SEC answers for.

So the catalyst will naturally change the complexion of the company, and this is exciting, and we've navigated the waters over time to arrive at this point. And so we all need to get patients and see what the impacts are from these results. So there's much to look forward to, yes.

Indeed. Thank you, Philippe. So let's go to analyst questions. But thank you, Peter, Emilie, Linda, Philippe for the discussion. Some good insightful comments there, and I hope those on the line also have got some insights and appreciate that.

The first analyst to ask a question is Dr. David Stanton of Jefferies. Hello, David, are you there?

I am. Can you hear me?

Yes, David. Please go ahead.

So my question is, do you have to wait until you have the results of CUV105 -- sorry, CUV105 and CUV107 before you file for approval in vitiligo? And in which geography would you file in first and why, please?

I'm going to take this question, Malcolm.

Okay.

It's a -- yes, it's a good follow-up and from what I was mentioning a couple of minutes ago. So thank you, Dr. Stanton for this question, question that's relevant and often asked.

Our intention is to complete CUV105 and CUV107 before going to the EMA and FDA. And the recent announcement on single trial for drug approval from the FDA doesn't change this strategy. So based on the ongoing interactions we have with both agencies, EMA and FDA on the specificity of our work that we are conducting, we will need the CUV107 study to complete our program.

For the second part of the question, we opt to file with the EMA first and then FDA second. And this really -- this strategy really much follows the approach we had with EPP back in 2012.

I want to say more. I think it's important for me when we speak about regulatory agencies, I want to give a bit more color. An agency, as you know, it's a conglomerate of thousands of people, so at the EMA in Amsterdam, there are more than 1,000 permanent staff and more than 4,000 part-timers and experts. We are dealing with 2 European reporters that are representing the National Competent Authorities, which are Lithuania and Poland, with a scientific adviser representing the Scientific Advice Working Party, a very knowledgeable German physician.

At the FDA in Silver Spring, there are more than 8,000 permanent staff and another 6,000 elsewhere consultant part-timers. We interact with the Division of Dermatology and Dentistry now led by Dr. Jill Lindstrom in the Center of Drug Evaluation and Research. And we have a new Commissioner, as you know, Dr. Martin Makary, who has reshuffled the agency, bringing new procedures and new approach.

In our EMA reporters, we find willing listeners and may I say more supportive of our regulatory and market strategy. We are the only company focusing on patients of darker skin color and this point resonated very well in our recent discussions with the EMA.

The approach we have on vitiligo is so novel that we deem the European regulators to be the first protocol, and then it will make it easier for the FDA to assess similar data.

Okay. Thanks, Emilie. The next question is for -- from Dr. Melissa Benson of Barrenjoey. Hi, Melissa.

So I had a question in regards to the ACTH program, so NEURACTHEL. Just to help us understand, you've mentioned there later this year, you expect to file with EMA. A similar question to the lining of vitiligo, but understand like how does filing with Europe first and then the FDA, how does that kind of expedite the U.S. opportunity?

And then secondly, any color you can kind of provide on the differences, I guess, between the commercial landscape for a product like this in Europe versus the U.S.? Because I understand one market is quite a synthetic peptide-based and the other is a natural hormone based. So that would be great.

Philippe, for you.

Thanks, Melissa. Yes, we've talked about this in the past. NEURACTHEL will first be filed in Europe through the route of mutual recognition. And as you know, the analogues of ACTH, in our case, NEURACTHEL are used by many institutions, both as a therapeutic and as a diagnostic. And so we opted to go to Europe first and U.S. second.

Once you've filed through the mutual recognition procedure, you can file shortly in the U.S. after. ACTH products are mostly distributed to specialty centers in Europe. They prescribed by internal specialists, endocrinologists. And we believe that it's possible to make the first inroads directly to these centers in Europe.

Reimbursement in Europe is albeit lower than in the U.S. So both markets are sizable and are attractive, but we have experience in leveraging the European regulators and the resonance there is high. So it's a slightly different strategy than most of our competitors, but so far it worked.

Okay. Thanks, Philippe. We've just lost you on camera. So if you can try and get back to us, we'd like to continue to see you.

Let's move to Dr. Thomas Schiessle of Parmantier in Germany. Thomas, you're a long way away, but let's hope you're connected.

I would like to ask a question, what does the recent FDA decision on Disc Medicine's Bitopertin mean for your business and growth outlook, please?

Okay. Peter?

Sure. Yes. No problem. I can answer that one. So I guess thank you doctor for your question. From a finance perspective, I'm happy to answer that. So I see it from a way of increasing our monopoly in the market with the other player, obviously, not being able to enter that market yet as we're really the only approved drug treatment for EPP with a proven safety and efficacy record in the U.S.

So it could take them, I would estimate about 1 to 2 years to come back or even longer to enter the European market. So it could be quite an extended period of time that we still maintain a monopoly within that market. So I guess that's how I see it, doctor.

I'll come back to you, Thomas, to ask another question because we've covered that fairly succinctly. But I'd like Linda to make some comment because some shareholders have asked what's our reaction to the FDA's decision on this. So can you make some comment on that, please, Linda?

Sure. First, can you hear me okay?

Yes.

Okay. Right. So first, I definitely can comment. However, I do prefer not to comment on the setbacks of other companies or their management. And I will just leave that to the external observers.

And while competitors may have made critical remarks about our work, I don't consider it to be elegant to respond in kind. However, what I will say is that it is not easy to get a regulatory approval in one go. Our team have done this by working thoroughly and diligently. And at the end of the day, it is really all about the patients, making sure that the drug is safe and that it shows significant clinical improvement in their quality of life.

And the FDA really raised questions regarding the bioavailability and efficacy of Bitopertin, which, by the way, I'm sure most of you already know. This was actually originally developed for an antipsychotic drug for schizophrenia before it was abandoned by Roche.

And so for EPP, the company had then had to increase the dose from 20 milligrams to 60 milligrams to achieve a statistically significant reduction on the biomarker of the protoporphyrin level. But higher doses also mean that there's going to be extra stress on the patient's liver or kidneys. And this is very concerning, especially for EPP patients because they are already at a higher risk of liver disease.

And on top of that, oral pill higher dose also increased side effects, complications and drug-drug interactions with other medications. So as the pharmacist, I really cannot see how this is a benefit for the EPP patients.

And the other point that the FDA also raised, a very valid concern, was its primary endpoint. And this was based on the change in the biomarker protoporphyrin IX. So in case -- I don't know how much you guys know about biomarkers. Well, biomarkers are a very helpful tool for scientists, for physicians to really understand what's happening in our body, but it does not always reflect real-world meaningful clinical benefit.

And an example that comes to mind is there was a drug that was received an accelerated FDA approval back in 2016 for an advanced soft tissue sarcoma, and this was approved based on a biomarker endpoint. But once they came to real life, the real-world clinical outcomes did not show any survival benefit. And so at the end of the day, the FDA had to pull the approval soon after.

And from a bigger picture pharmacological perspective, it also seems very unusual to me to prescribe a lifelong oral pill that affects the central nervous system to lower the protoporphyrin IX marker -- biomarker levels. So I guess, I suppose, we'll really have to wait to see the results of their future trials to see whether this drug can really show both the efficacy and the meaningful clinical benefits for the patients.

Right. Very insightful. Coming back to you, Thomas, do you have a follow-up -- a quick follow-up question?

Yes, indeed. Thank you, Malcolm. Absolutely another issue. The FDA -- no, no, no, no. That's a second one. What impact does NASDAQ listing have on CLINUVEL's future regular reporting concerning frequency and content, please?

Okay. Peter, for you.

Sure. I can answer that one, Malcolm. So we'll be listing on the NASDAQ or uplisting our ADR program and listing over there as a foreign private issuer. So what that basically means is that we'll continue to lodge half year and full year financials.

In the U.S., we'll be reporting in U.S. dollars and also in U.S. GAAP accounting. But I guess, in short, Thomas, it's -- it will be exactly the same as what we currently do every 6 months and then every 12 months for the half year in the annual reporting. So no real change to the frequency.

Thanks for dialing in Thomas. I just mentioned that several shareholders have asked for an update on our listing application. So Peter, give us an update, please.

Sure. No problem. So we lodged our initial filing, which was a 20-F document to the SEC in mid-December or 18th of December to be specific. And we did foreshadow that there may be some delay in the turnaround time because it was also -- it was Christmas period, but also the government was -- had come out of shutdown mode and the SEC that obviously affected them. So they needed to catch up and clear the backload of filings and other documentation they had.

But we have had some further correspondence back and forward with the SEC, and we're refiling our response to them. So we're hoping to be able to receive clearance from them in the very near future and then move quickly to implement the ADR program uplift. So watch this space.

Okay. We sure will. Let's now call on Sarah Mann from Moelis. Sarah, please.

My first question is just on the EPP market. Could you provide us any details around what percent of your patients are covered under Medicaid? And just curious how you anticipate some of the cuts to Medicaid potentially impacting your ability to reach those patients?

Linda, for you.

Sure. I'll take this one. Sarah, thank you for your question. So we're actually seeing less than 5% of our U.S. EPP patients on Medicaid benefits. So in short, we don't really have a noticeable impact. And in fact, like you mentioned the One Big Beautiful Bill, it actually broadens the orphan drug exclusion. It now allows orphan drugs to -- with more than one rare diseases to remain exempt from Medicare price negotiations and potentially so far looking like it's indefinite unless the drug is later approved for a non-orphan indication.

So one can theoretically say that the TAM would increase through curing the federal programs. But given that most of our patients are commercial insurance patients, we don't really see a worthwhile impact in the U.S. market at this time.

Okay. Sarah, a follow-up question.

Just on a separate topic. Just curious if you could provide more color around the cosmeceutical strategy. Obviously, it's been in market for a couple of years in, I suppose, prototyping or early stage testing. Yes, just curious how you expect it to ramp up this year and any learnings that you've had over the past couple of years as well, please?

Philippe, can I call on you?

Sure. First of all, good to see you back, Sarah. It's been a long time. On numerous occasions, we mentioned that the PhotoCosmetics are in development, and they accompany a complement our pharmaceutical program. That's quite an unusual strategy to have both pharmaceuticals and the PhotoCosmetic franchise, not many pharmaceutical companies do that.

And so the first was the P line, the photoprotection lines, providing polychromatic photoprotection in population of the highest risk and extreme conditions. And then that will be followed by the M line, the melanocortin containing peptides. And they intend to provide assisted DNA repair and self-bronzing or the so-called sunless tanning.

And in all these properties, the endeavors goes really to launch products with a substantial marketing effort. And that needs to provide visibility to our products. And we started to gradually increase our marketing spending online to focus groups, advocates, target populations and channels. And so we are in the prelaunch phase where we get feedback on these products.

But ideally -- and nothing is ideal, but that was the anticipation and the model, when the vitiligo trials start to yield results, we then see a parallel large-scale effort to promote the M lines, because the concept was that the medical tanning that you see in vitiligo follows a parallel path to the PhotoCosmetic self-bronzing properties. So in short, we advance, but we're not really ready to launch these products, not from a scientific point of view and not from a marketing.

But what we aim to see is lotions and serums applied a number of times a day that assist the self-bronzing in the epidermis. And we're not quite there yet, but we're advancing.

The other part is in order to make this a commercial success, the company needs to differentiate itself in all aspects. The retail experience needs to be changed or disrupted, if you wish. The primary packaging, the secondary packaging, the way we distribute it, the retail store concept and all that at a reasonable large scale.

But thereby we are conscious of the spending and the budgets we put aside for this exercise while keeping the company profitable. So it's a balancing act that we do need to navigate all the obstacles, but to decrease the risk of failure and that we do that in a very gradual and deliberate manner.

Okay. So let's move to Madeleine Williams of Canaccord. Please, Madeleine.

So I think, firstly, I was just wanting to know, you've got a few things happening at the moment. Obviously, last year, Europe allowed the increased number of doses and then also in the U.S. as the Disc Medicine trial completes this year, I assume there's sort of going to be more patients available. Just thinking about how you're thinking about the growth in those jurisdictions and sort of the splits going forward.

Well, Peter, do you want to comment initially on...

For me? Yes, sure. No problem, I can comment on that. So I would say that there's a segment revenue note that we've included within the half year report that does show the breakdown. But I guess a quick summary would be the U.S. revenues have increased year-on-year.

And this period, we saw a rise more predominantly in the European volumes, partly spurred on by some patients taking up that increase from 4 implants being a maximum during the year up to 6 that was announced in September 2025. I guess at the moment, the current revenue split is about 53% U.S., 47% for the rest of the world. So that kind of -- that's the insight that I can provide there. I guess on the peptides side, that's probably more Philippe perhaps might be able to answer that one.

No, we'll park that. I think we'll move on to Mark Pachacz, because I think he's got to leave pretty soon. So Mark, if you're still there, can you ask your question?

Malcolm, looks like Mark is no longer here.

Okay. That's all right. Well, fortunately, we have another analyst, Thomas -- Thomas Wakim of Bell Potter. Do you want to ask a question please, Thomas?

Yes. It's a bit of a follow-on from the previous one actually. So in that revenue segment, the split between U.S. and non-U.S. sales for the period just gone, where we saw a decline in the U.S. and a significant increase outside the U.S. So can you just kind of explain in a bit more detail what those factors were that were at play there leading to that? And how does that look moving forward?

Sure. So there was some effect on the U.S. side from the government shutdown. So the government shutdown met delays in Medicare processing as well as also the processing of reimbursements. So in some instances, some of the smaller centers didn't want that longer-term delay on their payment cycles and things like that. So that did cause some headwind there for them. And then we also passed on a CPI increase in 2025 and some of those have caused some negative reimbursement pressure on some of the centers.

But overall, we anticipate that the U.S. is still stable and still growing across that, and that's where we've continued increasing the number of centers across North America. So we're seeing new centers come online and start to bring patients to the floor as well. So there is that difference between prior year and this year, but I think it's really explained by the U.S. government shutdown predominantly.

Okay, Peter, thanks. And as I was talking with Madeleine before and also with Mark Pachacz, there was a fair bit of interest in peptides. So let's come back to peptides and ask Philippe to comment on the potential of that new area of development.

Well, we spoke for a long time in public about the skill set of the company and how it was expanding concentrically. So we started off as a company focused on clinical affairs. We understood the melanocortin peptides really well. Then we focused on the delivery methods, the best way to deliver and administer a drug into a human body. And from that, we built our Singapore labs and progressed fundamental research into new formulations. We call it formulations of the next generation using liquid injectable peptide platforms.

And so naturally, once we mastered these technologies, it opened up the realm of fantasies of what other peptides could you use to deliver a product in a sustained or controlled manner. And that's where we are. So you're going to expect much more from that team and our activities in Singapore.

Thanks, Philippe. Very exciting. It's about time that we wrap up, but I didn't want to conclude without addressing a couple of shareholders who asked me about the company's dividend policy and whether we have one, and I can say we certainly do.

It's available on the CUV website, but I can tell you that it is the Board's intention to pay a dividend subject to the sufficiency of our funds and the operating and investment needs of the business and indeed future growth and needs to fund that growth. So the Board will determine that, and you can investigate, as I say, the dividend policy online.

So I want to say thank you to all the analysts online for asking their questions. Peter, Emilie, Linda, Philippe for their contributions, good insights and all attendees, thank you very much.

A link to the webinar will be posted to the CLINUVEL News website as soon as possible for other stakeholders to review. So I'll now close the webinar, wishing you all good health and fortune. Thank you.

Good morning, ladies and gentlemen. My name is Professor Jeffrey Rosenfeld, and I have the privilege of being the Chair of CLINUVEL Pharmaceuticals Limited.

As Chair of today's meeting, it is my pleasure to welcome you to CLINUVEL's 2025 AGM. I note that we have complied with the relevant requirements for convening this meeting and that a quorum is present. As the time is now 10:00 a.m. in Melbourne, just after, I formally declare the meeting open.

Before the formal business of the meeting, I'd like to acknowledge the traditional owners of the land on which we meet today. I would also like to pay respects to elders, past, present and emerging and celebrate the diversity of Aboriginal peoples and their ongoing cultures and connections to the lands and waters of Australia.

I also draw your attention to our legal notice which highlights that there are risks which can impact the plans and initiatives we will be discussing today.

I'm joined today by my fellow non-executive directors. 3 non-executive directors are here in person, Mr. Susan Smith, Mr. Matthew Pringle, Mr. Guy van Dievoet, Dr. Pearl Grimes and Dr. Karen Agersborg join us online from the United States of America.

I would also like to welcome our Managing Director and CEO, Dr. Philippe Wolgen; our Chief Operating Officer, Mr. Lachlan Hay, who's on the screen; in Singapore; our Chief Financial Officer, Mr. Peter Vaughan; who's at the back there. Our Head of Investor Relations, Mr. Malcolm Bull; and our Company Secretary, Ms. Claire Newstead-Sinclair at the end there.

The company's auditors, Grant Thornton, are represented here today by partner, Mr. Brock Mackenzie. The auditors will be available to answer questions during Item 1 on the agenda or at the end of the presentations regarding the conduct of the audit and the audit report for the year ended 30th of June 2025.

I would also like to welcome our Corporate Counsel, Arnold Bloch Leibler, who kindly offered to host the meeting today in their offices. I'd like to specifically acknowledge Mr. Jeremy Leibler in the front row there.

Finally, I would like to welcome representatives from our share registry, Computershare, who are present today, and I welcome all of you, shareholders and interested parties as well.

The notice of meeting has been given in accordance with the company's constitution and copies are available for you on the company's website, the ASX announcements platform and at the share registry's registration desk. I will take the notice of meeting and explanatory statement as read.

The format of the meeting will be a brief Chair address from myself, a formal consideration of the business on today's agenda with an opportunity to ask questions on the formal business, completion of the poll on the formal items of business and close of the formal part of today's meeting. Then there will be the Managing Director's update, and then there will be general questions from the floor. Shareholders will be able to ask questions and cast votes at the appropriate times while the meeting is in progress.

So before we commence with the formal part of the meeting, I would now like to provide my opening Chair's address. To open, this session is being recorded and will be made publicly available on CLINUVEL's website, ensuring full transparency and equal access to information for all shareholders.

Our successful financial position has been well covered recently and will be further presented at this AGM. Today, I will give you the Board's perspective on how our strategic planning translates directly into your financial returns. Our CEO will address the future following the formal business, and I will address the foundation upon which it has been built.

In the pharmaceutical industry, intent is cheap. Execution is everything. This brings me to a concept we treat as a core financial metric, longevity. It is not merely a measure of time but a quantifiable competitive advantage, a disciplined, capital-efficient execution of a long-term plan against relentless headwinds. You should not underestimate its value.

Allow me to crystallize this with 3 financial case studies briefly. Case study 1, the EMA, that's the European Medical Regulatory Authority approval is a lesson in strategic capital allocation. In biopharma, regulatory bodies hold ultimate veto power. For 3 consecutive years and despite robust evidence, the European Medicines Agency rejected our data for expanding the use of SCENESSE and aligning it with the U.S. FDA-approved label.

The Board faced a clear capital allocation decision, continue dedicating 7-figure resources to this pursuit or cut our losses and deploy that capital elsewhere. The opportunity cost was significant.

We analyzed the risk. Our team's conviction backed by irrefutable data versus the irrationality of the initial regulatory stance. We committed to our data and our team, and that commitment paid off. Last month, the EMA approved the expanded label and admitted errors and misjudgment in its assessment.

The result? An expanded revenue stream secured for the European business. This is not a story of perseverance. It is a case study in a Board making a disciplined, high-conviction investment in the face of uncertainty and winning.

Case study 2, the Singapore venture and owning the technology. 4 years ago, our internal R&D on sustained release formulations showed unconvincing data. We had a choice, shut down internal development and outsource this activity at a premium, surrendering future IP or continue funding our own laboratories.

External advisers rightly noted the low probability of success. But our CSO and CEO argued that success, however slim, would create an unassailable position. We, the Board, backed them.

The result? In January 2025, we saw that our faith and patients were being rewarded. We learned about breakthrough data emerging, leading to the bold decision to advance new liquid injectables formulations to the preclinical stage, the final step before manufacturing for human trials. We now own the foundational IP for next-generation liquid injectables. We own the asset outright. This disciplined internal capital allocation over a decade has created optionality and value that outsourcing never could.

Case study 3, financial discipline, the dividend versus growth calculus. We operate a singular model in biotech, profitable, dividend paying and fully self-funded. This is a deliberate capital strategy, not coincidence or luck.

We made a conscious decision to reinvest $175 million over 5 years into our pipeline, vitiligo, porphyrias, ACTH and new formulations. The market was informed. The discipline was absolute. We came in 3.1% under budget whilst advancing all programs over a 5-year period, financial year '21 to '25, 3.1% under budget.

The financial logic is simple. We chose to conserve profits, avoid capital raises, forgo a marginal increase in dividend payments and place share buybacks on hold. This is all in order to fund R&D that we believe will generate significant returns. We are building high-value assets inside a profitable company without diluting you, the shareholder. This financial stewardship is your structural advantage.

I'd now like to present a retrospective on execution. At last year's AGM, I committed to exploring acquisitions. From the 10 viable ideas our teams generate or receive annually, we commit to deeper diligence in a number of these. Our teams made 2 disciplined nonbinding offers for North American assets. Both were abandoned as we could not guarantee the levels of return that we seek from such opportunities.

We walk away from deals that do not meet our strict risk-adjusted return criteria. Instead, we redeployed that capital into our own higher-conviction pipeline. This is capital restraint in action. However, we continue to pursue further options for business acquisition in North America, particularly that would add value and pose low risk to our existing business. Furthermore, we have stress tested our operational resilience. At the time the CEO recovered from illness, our team delivered a ninth consecutive year of growth and profitability.

On PhotoCosmetics, we often get asked about this. As I reported in my recent Chairman's letter, we continue to refine our PhotoCosmetic formulations, which is a complex undertaking, I might say, in our Singapore laboratories. The time lines to regulatory approval and marketing will be presented by Dr. Wolgen. The Board's view is that PhotoCosmetics may well become an important revenue stream for CLINUVEL. And they, the PhotoCosmetic should be pursued with prudence, but also with vigor.

The road ahead. We are building a diversified portfolio of melanocortin-based assets designed to withstand the test of time and market cycles, developing a suite of drugs and PhotoCosmetics based on platform technologies. Looking after both patients and those who desire advanced skin care through the PhotoCosmetics is the driving force for the company. Providing long-term care and constructing close relationships with physicians and their patients as an integral part of our culture, so is our commitment to add value for our shareholders.

The Board carefully considers the chances of product development for the future where highest needs exist. We shut down development programs when we lose the conviction of commercial reality and end up with cash to be used for projects where returns are expected. The pipeline is being de-risked. Finances are secure and talent is retained. Are there further dangers left? Absolutely. But any sophisticated investor who has done their diligence understands that our premium valuation is not for hope. It is for a proven executable plan and a team that delivers on its capital commitments.

I stated when I became Chair that major changes would be made under my guidance, and we have made them. We attracted 3 new directors, and we have a Board challenging each other on major issues and taking well-analyzed and considered decisions, unafraid to speak their mind on critical topics to drive the company forward.

I spoke last year about the development of the business and the value created against a flat share price. Under threat of tariffs, major challenges in pharma, investors' fear of competition, we have delivered another year with significant progress on SCENESSE, ACTH, new formulations and vitiligo trials over recruitment of the trial to name a few.

More important to you, we retained talent and added new staff. We also presented ourselves in a memorable way to an American audience at the American Academy of Dermatology Meeting in Orlando in March '25. We will do so again in Denver in March '26.

In this address, I've given you many reasons to continue to support the Board, me as Chair and the management team. Can it all go wrong as we diversify the pipeline? Of course, it can. There are no certainties in our sector, but anyone who has done thorough research has silently assigned a percentage of value to our team executing their lifetime investment.

Lastly, some of you have asked me about the status of succession planning for our CEO, and I intend to share more with you about that in the new year.

I hope you perceive the same positive direction the company has been taking as I do. CLINUVEL is on track to deliver, perhaps taking longer than some would like, but we are certainly navigating the path and overcoming substantial challenges. I have no doubt that a bright future lies ahead for CLINUVEL, perhaps brighter than you can imagine. Thank you.

And now to the business of the meeting for the formal business. There are 4 items of business today, 3 of which require a formal resolution. This includes 1 nonbinding ordinary resolution and 2 binding ordinary resolutions. In order to ascertain the true intention of shareholders and to reflect our focus on transparent governance in accordance with the company's constitution as Chair, I have determined to call a poll on all resolutions to be considered at today's meeting.

The voting procedure is as follows: All valid proxies received have been recorded, and the votes for each resolution will be displayed on the screen behind me. And as such, I won't read out the numbers as we deal with each resolution.

As advised in the notice of meeting, where proxies have been properly nominated to be at the Chair's discretion, these proxy votes will be cast in favor of resolution 1 to 3. With regard to voting on resolutions, all shareholders, proxy holders and authorized corporate representatives who are entitled to vote should have been issued with a blue voting cards, as you can see on the screens. A voting card also entitles you to comment and ask questions in this meeting. If anyone present is entitled to vote and does not have a voting card, please see one of the Computershare staff at the registration table at the entrance door. They will assist you.

Nonvoting shareholders were issued with a yellow shareholder attendance admission card upon entering, as you can see on the screens. A shareholder attendance card will not allow you to vote. However, you may still comment and ask questions.

White cards are visitor cards and indicate a visitor. Visitors and media are reminded that whilst we welcome you at this meeting, it is a shareholder meeting, and you may not make comments or ask questions.

If I call on you, please raise your voting or nonvoting attendance card prior to speaking to identify yourself as a shareholder. If you are acting as a proxy, please state clearly who you are appointed to represent when introducing yourself to the meeting. We will provide the opportunity at the end of the formal items of business for shareholders to ask questions. Voting on all resolutions is allowed up until the time the poll is closed. A representative from our share registry, Mr. Peter Renda of Computershare will now provide details on the poll process. Peter?

Thank you, Mr. Chairman. Good morning, ladies and gentlemen. We'll now go through the process for the poll. We'll be conducting a poll on resolutions 1 through 3 on the reverse of your voting card of the 3 items of business. Please mark the box next to each item to find how you wish to cast your vote. I'll be bringing around a poll box. Please ensure you lodge your card in the poll box to make your votes counted. Thank you.

Thanks, Peter. When Computershare tallied the poll results, we will announce the results following conclusion of today's meeting on the ASX Market Announcements platform.

With regard to proxies, we have engaged the services of our share registry to compile and report on the proxy voting. Computershare has provided its formal report disclosing the proxy votes received.

Before opening the poll, I wish to remind shareholders that the poll will remain open for an additional minute after we have considered all resolutions. If you have any questions on the formal part of today's agenda, please follow the questions process as previously advised. I now declare the poll open.

I will move to the items of business to be considered today. Item 1, the first item of financial statements and reports of directors and auditors. The first item is to receive and consider the financial statements and reports of the directors and auditors for the financial year ended 30th of June '25. These items are contained in the annual report, so I will ask that they be taken as read. The annual report is available on the ASX announcement platform or on the company's website.

The Corporations Act requires the accounts and reports to be laid before shareholders at the Annual General Meeting. However, except as set out in resolution 1 to be considered later, there is no requirement for a vote of members to be taken on them. No written questions to the auditor were received by the cutoff date, 5 business days before this meeting.

The questions may be directed through myself to the auditor in relation to the conduct of the audit, the audit report, the company's accounting policies or the independence of the auditor. Does any shareholder have any questions or comments on the financial statements and reports? There being no questions, we will proceed with the agenda.

We will move to the formal resolutions that need to be considered. Proxies received in relation to the formal resolutions will be set out in the slides displayed on the screen behind me. Item 2 is resolution 1, which is the adoption of the remuneration report forming part of the directors' report for the financial year ended 30th of June 2025. The vote on this resolution is advisory only and does not bind the directors or the company.

I now invite Mrs. Susan Smith, Chair of the Remuneration Committee, to say a few words and chair the meeting for resolution 1 and 2. Thank you, Susan.

Thank you, Jeffrey, and good morning, shareholders. I have seen the proxy votes lodged, which are shown on the screen. Voting will shortly be finalized, and the record will show the will of this meeting. My purpose today is not to change that record, but to ensure its implications are understood with absolute clarity.

I also send -- I also seek to lend perspective to the thinking of an international Board of an Australian listed entity, an entity which generates all of its revenues and employs most of its teams outside of this country and my own views as a former CEO of large complex health care organizations.

From this latter vantage point, I have lived what an organization expects of their executive leadership and see how this needs to be considered by all stakeholders. The remuneration report is not an invoice. It is a strategic blueprint. It is the mechanism by which this Board secures and retains the leadership required to navigate a sector where failure is the norm and success is the exception.

As Board members, we are privy to complex and often critical existential decisions taken by the CEO and his team. Those decisions which have taken the right turn for our shareholders and those decisions which have prevented us from facing the wrong terms.

At the end of fiscal year '25, the result of those decisions is a company which is performing very well in a challenging environment of price cutting of pharmaceutical drugs, restrictions by health care insurers and competitors running scaremongering campaigns on SCENESSE and CLINUVEL. The committee pays for good decisions and the avoidance of really bad ones as well as the risks anticipated and communicated to us as a Board.

To those who voted against the remuneration report, you have registered a protest, but let us be precise about what you have protested against. You have voted against a structure where the majority of the CEO's compensation is contingent on delivering the long-term value you demand. You have voted against a structure which needs to be competitive on a global level to retain the current leadership while sufficient to attract new talent to steer CLINUVEL in the future. The business requires us to think and operate globally and structure our approach accordingly.

You have voted against the principle of paying for proven multifaceted performance, not just profitability, but the cultivation of talent, the stewardship of a robust pipeline and the strategic foresight that has consistently shielded this company from existential risk.

Let me just explain the committee's perspective on pay for performance. Performance is running a viable enterprise in each of the past 20 years, meeting the criteria of appointed auditors, performance as in investing and training people, retaining them and building the next generation of leaders. Performance as in making sure the highest likelihood of success comes out of research and development pipelines. Performance as in anticipating policy, legal and regulatory changes. Most of all, performance is being responsible for complex decisions that could easily have failed, leading to disastrous outcomes.

In simpler words, the company pays for the assessment and management of risk by its CEO. You have voted against the market reality because to attract and retain the caliber of leadership capable of building one of only two profitable melanocortin companies on the planet requires investment. The alternative is not a saving. It is a discount on mediocrity. Most critically, you have voted against stability in an industry defined by volatility.

The medium biotech CEO tenure is 4.7 years, a time line synonymous with abandoned strategies and vaporized value. Philippe's 20-year tenure is not a cost. It is your single greatest insurance policy against the cycle of decline that has consumed our peers.

Look at the landscape. According to Bioshares Research, 57% of Australian listed life science companies are now seeking funding as they have less than 1 year of cash reserves left. Global firms are seeking to offload assets or staff to stay afloat as they fail to execute on clinical or commercial objectives. We are not among them. We are profitable, dividend-paying and in control of our destiny. This is not an accident. It is the direct result of the leadership you have chosen to challenge. All shareholders have benefited from this leadership.

The conclusion this Board has reached based on data, analysis and the stark evidence of competitors who faltered is undeniable. The preservation of shareholder wealth is the direct byproduct of executive stability and quality.

Let me reiterate our 6 collective objectives for a CEO. Number one, establish and maintain a going concern. Two, strive for long-termism in executive decisions. Three, lay the foundation for a pharmaceutical group able to execute all research, development and innovation in-house. Four, adhere to prudent risk management of research and development and clinical programs. Five, commercialize products and services, which provide meaningful benefit. And six, establish a company which owns all or most parts of the supply and value chain.

Having executed as a CEO myself for nearly 3 decades, coached CEOs in large and small firms across a breadth of industries and as Chair of CLINUVEL's Remuneration Committee, I adopt the following in determining value of an executive and CEO.

There is no one-size-fits-all in pharmaceuticals. A CEO and their team are essential, particularly in innovative R&D companies. Stability of company and progress are inherently connected to each other. Not anticipating future changes in environment is often catastrophic in life sciences. One may hold different views on a remuneration package, but shareholders at a distance underestimate the impact of leadership.

Your vote against the remuneration report has the potential to undermine the leadership of CLINUVEL. History shows that companies whose leadership is undermined ultimately pay a far higher price than any remuneration package. They pay in lost opportunity in eroded value and in a long difficult climb back to credibility.

The Board is confident in its judgment to endorse a framework that pays for the performance that secures your future. The record will show your vote. The future will show the wisdom of the Board's approach to remuneration and ensuring continuity under the right leadership. Thank you.

I now draw your attention to the proxies received prior to the meeting as displayed on the screen behind me. I now move that shareholders consider and if thought fit, pass the ordinary resolution.

I now move to resolution 2. Item 3. We are going to take questions at the end, sir, not before. After I've gone through the resolutions.

Resolution 2 is reelection of Director, Professor Jeffrey Rosenfeld. The next item of business related to the reelection of Professor Jeffrey Rosenfeld as a Director of the company. I confirm that all directors other than Professor Rosenfeld recommend that shareholders vote in favor of his reelection.

I invite Jeffrey to come forward and speak to his background and election.

Thanks, Susan. I joined the Board of CLINUVEL in 2019. I was elected Chair at the end of 2023. And so I've been in place as Chair since then. I sit on the Remuneration Committee, the Audit and Risk Committee, and I am Chair of the Nominations Committee. I am strongly committed to CLINUVEL and its success. I have the expertise and experience to be Chair of a public company Board and a global pharmaceutical company.

I have had over 30 years' experience in leadership in the health and university sectors and in the Australian Defence Force, attaining the rank of Major General and Surgeon General of Australia. I have deep experience in organizational governance, culture, ethical behavior and practice and in strategic decision-making. I have a deep understanding of the business, of our business and medical science that CLINUVEL is engaged in. I have been an investigator on some very large international clinical trials in the health sector for many years.

CLINUVEL is now in a transition phase. I'm engaged in succession planning and the further development of our pharmaceutical products, pivotal clinical trials and our PhotoCosmetic development. It is, therefore, important to maintain continuity at Board level and for me to remain Chair.

Lastly, I am determined to get the best outcome for you, our shareholders, even if it takes longer than you would like. Thank you.

Thank you, Jeffrey. I move that Professor Jeffrey Rosenfeld be reelected as a director on the basis set out in the notice of Annual General Meeting. I refer you to the proxies received prior to the meeting as displayed on the screen.

I now move that shareholders consider and if thought fit, pass the ordinary resolution. I now pass back to Jeffrey, who will move to resolution 3.

Thank you, Sue. The reelection of Director Mr. Matthew Pringle as a director of the company. I confirm that all directors other than Mr. Pringle recommend that shareholders vote in favor of his election.

I invite Matthew to come forward and speak to his background and election.

Thanks very much, Jeffrey, and good morning, everybody, and thanks for the opportunity to speak in support of my reelection. Over the last 40 years, I've had the privilege of working across a range of industries, guiding organizations through growth, regulatory change and strategic opportunities. My experience includes leading IPOs, managing capital raisings and M&A transactions, driving governance reform and overseeing financial reporting risk and capital management. These are skills I've brought directly to my various roles as Chair of Audit and Risk Committees and as a Non-Executive Director, including here at CLINUVEL.

CLINUVEL truly is a remarkable business, one that combines scientific ambition with disciplined financial management. I've been particularly impressed by the company's balanced approach, maintaining strong cash reserves, funding growth from its own resources and delivering consistent fully franked dividends. These are qualities that set CLINUVEL apart in the biotech sector.

If reelected, my focus will remain on ambitious growth with disciplined financial and fiscal management and long-term value creation for all shareholders. I remain deeply committed to this company and really believe we have a very positive future. Thank you for your consideration and support.

Thanks very much, Matthew. I move that Mr. Matthew Pringle be reelected as director on the basis set out in the notice of Annual General Meeting. I refer you to the proxies received prior to the meeting as displayed on the screen. I now move that shareholders consider and, if thought fit, pass the ordinary resolution.

Do any shareholders have any questions or comments in relation to the resolutions today? If yes, please raise your hand. And if I call on you, raise your voting or nonvoting attendance card prior to speaking to identify yourself as a shareholder. Please state your name and the number of shares that you hold. If you are acting as a proxy, please state clearly who you are appointed to represent when introducing yourself to the meeting and the number of shares that you are representing. Please proceed. I proceed now to take questions and -- if you wish. Are there any questions on the resolutions? There will be time for open questioning at the end as well. Yes, sir.

My name is Harry [indiscernible]. A number of shares I've got -- I can't remember exactly, but you'll have to forgive me on that one. But I have roughly 15,000 held across various entities. Question I've got, in the resolutions, there's only 50 million-odd shares on issue, and it strikes me -- are you able to tell us how many people are voting against, not who they are, but what is the number?

Malcolm, would you like to?

And the reason why I asked...

Did you hear that question?

I'm not trying to be devious here. It's just a question, is it one block of some institution that's got themselves in a twist? Or is it multiple, multiple shareholders? It strikes me given that you only have 50 million shares on issue that it's a couple of big ins those who are sitting on the fence as were causing trouble.

Malcolm?

No. The number of voters, including registered voters and beneficial holders is well over 400 out of over 7,000 registered shareholders, which doesn't include beneficial holders. So there's a range of votes for and against from institutions, family offices, high net worth individuals and people -- other people.

So are you able to say what is their objection? Because if we go to the -- is it whatever the remuneration report is where there's a 63% of the votes already passed. Is that right? So what's that primary problem?

With the remuneration [ resolution ].

I'm not trying to be devious. I'm actually just -- I'm a huge supporter by the way.

I think the problem is that some shareholders and proxy advisers believe that the CEO's remuneration is beyond what it ought to be in the Australian context.

And note, I say the Australian context because that's the problem. We're dealing with here a global company with a global CEO. Most of our business is in U.S. and Europe. It's not here. Most of our staff are overseas. Our CEO is working mostly from overseas. Yes, we have an office in Melbourne. Yes, we're listed on the ASX, but our main business is elsewhere.

We are a global entity. And we need to attract a high functioning, high-performing CEO in the marketplace, we can't do that if we obey the -- particularly proxy advisers who are saying we should have a judge our CEO salary or remuneration based on Australian company standards. And we've done our analysis on Australian companies. And like overseas companies, particularly in the U.S., we know what the going rate is, and it's not the Australian rate. If we had the Australian rate, we would be doing exactly what Susan said and lowering ourselves to mediocrity, and the company would be in a worse position than what we are now with a successful well-performing company. And Philippe, being our CEO, we believe as a Board rightly deserves the salary that he's receiving.

Here. Here.

Any other questions? Yes, sir.

I don't know if I get this order right. Chris Williams. Bought and paid for more shares than are sitting in front of me. My question is to -- on the remuneration report. And I thank you for the lecture.

It's not a lecture. It's answering the previous question.

Not yours. The lecture that we got in relation to the defensive part of oh, I've got the vote, which is against me on the resolution. I've already voted. If I had to vote again, I wouldn't be changing the vote.

My question is and I've put my glasses on, you're currently accruing money in relation to the retention payment, which is to "facilitate and complete the company's strategic transition to a diversified biopharma," which has an end date of 30th of June 2026, 9 months or so. Does the accrual still stand? And are you accruing? And if so, what are the conditions that is needed to be satisfied? And I welcome that Philippe is here and in good health and that he gets to whatever the end dates are. But there must be something that has to be achieved in that time, specifically, which is mentioned also.

Beg your pardon. The plan is still in place, and therefore, the accruals will still be made.

It's to achieve something not a plan.

Ask your question. Now we'll let Susan answer the question. Thank you.

The requirement that is -- what we require is that the strategic plan is furthered and completed and that all of the items that are on the table at the moment that we've asked the MD to execute with his team, they all need to be completed. And that is what we are requiring. We also require that he actually remains in service until the end of June '26. That is obviously critical from what I'm saying.

And I would just add, I wasn't giving a lecture. I was actually trying to explain to shareholders that the Remuneration Committee really, really considers what is the best outcome for this company. And we believe that, that is to retain the fine leadership that we have enjoyed for the past 20 years and that it is critical that we continue to do that. So it wasn't a lecture, but it really was in response to people asking, well, what is it that the Remuneration Committee does? I have told you today what the Remuneration Committee does. Thank you.

Right. Are there any other questions? Thank you, Susan. Yes, sir. Can you pass the microphone, please, Caroline?

[indiscernible] Not sure there is the right question, this...

Tell us how many shares you hold before you asked the question.

10,000 to 15,000. Just if it is not the right context, please bear with me. I'm just trying to understand the vision from the management for the next 1 to 3 years and trying to understand maybe just the top risk and opportunities the company sees.

Okay. Good question. And that's exactly what our CEO is going to address for you shortly. So I won't preempt what he's going to say, but he'll cover vision and our objectives for the company over the next few years, yes. Are there any other questions? As I say, there will be open questions from the floor later on. Yes, sir.

Me again. 25,000 in case you're asking. Mine is to Mr. Pringle seeking reelection. You've been on the Board now for 18 months. Yes. So you had a good chance to see what the company has, the intellectual property it has. Have you come to a conclusion that PhotoCosmetics are feasible, exist and can be launched in the time frames that the company has been announcing?

Well, I'd have to say PhotoCosmetics feasibility isn't my area of expertise, but mine is more on a financial. I was in Singapore with the Board earlier this year, getting a presentation from the team on the PhotoCosmetics. And to be honest, some elements the Board was very happy with and some not, as you would expect in a normal organization. And Philippe might go into this a bit more in his presentation in terms of the direction we're heading in PhotoCosmetics.

So I focus more on not so much the technical aspects, but the financial, as you'd appreciate from my background in terms of their marketability and their commerciality and whether we're going to make a profit out of them. And at the moment, the product line, in my view -- I mean, cosmetics is a tough sector. But assuming the products meet our expectations, I think the future looks pretty good for them and for the company. It's pretty hard to go into much more detail than that, I'm sorry.

I think you'll hear more detail on this from our CEO report shortly. Are there any other questions? We probably should move on. We've got a fair bit to cover. There will be an opportunity to ask further questions later. But if there are no further questions or comments, that concludes the formal resolutions to be considered.

If you require further time to complete the poll, please indicate by raising your hand. I'm just pausing while the voting is concluded.

[Voting]

Thank you. I now declare the poll closed. Now on to other business. As the company has not received notice of any other business, I will now move to close the formal part of the meeting.

I now hand over to Dr. Wolgen to provide his Managing Director's address. I might just say that Philippe is a bit under the weather with the virus. So please bear that in mind. Philippe?

First of all, I need to acknowledge our auditors and ideal partner, ABL for hosting it, Bioshares for following us 20 years. We are going to do this slightly different today. This is my 20th AGM. And I'm not going to provide you glossy slides of financial projections. I'm going to tell you the story how it is in 4 chapters. And we'll talk about the value of time in science, and how that relates to CLINUVEL.

As MD, I see it as my primary task to figure out the durability of a business concept, but also to build moats around the science and making sure that every dollar that we spend has the highest probability of returns. And that is in an industry where the house wins in 87% of the time. Now that's not the investment that is gambling. And from that moment on, you ask yourself, well, if we're playing against odds that against us, why would that not occur to us? That's risk management.

As a Board, and I've been part of a number of boards in the last 20 years, I asked the Board at a number of times, but as our cash reserves grow, I asked them the irrevocable question, a very uncomfortable question, should we give it back to you all, every single penny of it? And at the moment, we're standing at $230 million. Or should we do something totally different? And the third option, should we continue what we do.

And that every of these 6 to 8 Board meetings a year, the answer is unequivocally that we should continue what we do. So I'm going to speak to you first on $4.90. $4.90 is the value of the cash in the company, non-diluted per share. And that doesn't take in account the premium, the pipeline or the fantasy. Ask yourself, well, if that is the bottom of the company, it's not what we're trading 2 or 3x the value of cash. What's wrong? Is it the norm in our industry? Well, cash serves a number of functions, certainly in our industry. It gives you a 3-year runway. And don't forget that in this business, time is option price on a breakthrough, a scientific breakthrough.

You also have the exclusivity and sovereignty, the ability to look your credit to suppliers and you in the eye and say, well, we can meet our obligations. It gives us a shock absorption. That means that in the industry where governments come to a standstill, public offices, FDA shutdown, turnaround is long with the ability to navigate these periods. And fourth, it gives us the privilege to fail. Many people and certainly my peers don't like that. But the privilege to fail means that a rejection, an obstacle is not an existential threat to the company when it carries its resources.

The second number that I want to share with you and on my way through this meeting, I reread what I call the bible that every investor in life sciences should read. That's a paper by the Massachusetts Institute of Health 2019 by Wang Xiao and everyone who touches biotech or MedTech ought to read that paper. And I'm going to speak very slowly. It's recorded so you could read it back in the transcripts, I hope.

MIT over 16 years, analyzed 406,000 clinical trials with 21,000 compounds and compounders drug products. Out of those 406,000 trials, only 13.8% met their objectives, and that is from Phase I to regulatory approval. I really recommend you to have that as bedside literature.

These are not favorable odds, as you understand. And we ask a question, are we belonging to that pool of 13.8% and how do we prolong that? Now if you take the graveyard of oncology out of it, which has a probability of success of 3.4%, you arrive at 20.9% overall success rate. If you then discount the 80% of companies that bring these products to market, there's a very small pool that actually generate revenues or come to a breakeven point. And I've seen that the last 20 years as my principal task to navigate and make sure that we increase the odds of success.

The third number I was thinking of to share with you today is $410 million. $410 million is the amount we spent over 20 years to come to this point in time. That's $20 million average spend per year. In our sector, that is ridiculous. To develop drugs to market, to develop a pipeline and increase its chance with a $20 million spend is in the eyes of U.S. institutions when I speak to them, almost an impossibility. They often ask us whether we cut corners or whether we've made rounding errors or we have off-balance sheet transactions, but that is the number that we spent over 20 years.

If you then translate that to what we do at the moment, that's about $1 million per employee in revenues or in USD 700,000. The median in the U.S. is between $200,000 and $400,000 revenues per employee.

We posted the last financial year, $35 million in profit over $55 million in expenses. That means for every dollar that we spend, we get $0.65 in profit. In the industry, that's about half.

Another metric that I always look at is and in managing the company and establishing it is fixed versus variable cost and the contribution margin of 60% means that operating leverage is such that we can switch off the fixed cost when we need it.

These financial metrics are not a hazard. It's not a coincidence that we started off by putting that in our adviser and said this is what we want to achieve in order to belong and remain to the very small pool of companies in the world that navigate on profitability. And that's a challenge. It's a business model that is somewhat exotic in biotech.

If I speak to blue-chip institutions in the U.S. as part of our non-deal roadshows, they say, well, [indiscernible] black swan. We don't see profitable companies. But to fund your R&D from your profits is almost an impossibility in the eyes of U.S. investors. That's not something that we glow or boast about, but the reality is we chose this business model in order to be able to self-fund our R&D, and we are exactly at that point. So we talked about $410 million.

Now what is the future and what are the inflection points? And I think that comes to your point. Well, we are at the stage where we have the emergence of SCENESSE advancing it in vitiligo, arguably the biggest market. We're doing something totally novel. We're repigmenting patients that have lost their color. We're advancing ACTH. You will see the filing update in 2026. So we're entering a generic market. Often, the question is, well, if you got a branded product, why are you entering generics? And the answer is because we diversify, we lower the risk.

But then there is the pipeline, the research and unfiltered and centered without bias, I will share with you and that this goes on record how that goes. You open labs, you build your own teams. And for 9 years, we were in despair because the results were not the way we wanted to go, and we expected much more from the teams in Singapore. And there were many times where the CSO, Dr. Dennis Wright and I said, well, let's call it a day. That's it.

The first glimpse of hope came in November 2024, but the breakthrough came in January 2025 because producing data is one thing, but the art and the skill in our field is to produce reproducible data or repetitive data that can be, and that's a big word, validated.

And we had a vision, also a big word, an idea, an ambition. By being a specialized company on peptides, proteins, hormones and understanding exactly the biometrics that we needed for these to be successful and one is bioavailability or therapeutic window, which is an expensive word is dosing at the right concentration such that you don't provoke intolerability or comorbidity, you need to keep patients safe and you want the drug to be effective.

Now in peptides, the therapeutic window is very small. If you then have a half-life of minutes and a low bioavailability, then you've got 3 challenges to meet in R&D. And many, many years, we knew that it could be done. But if the teams can't deliver it, you come to a point where you want to throw the towel in.

But a year ago, we started to see results after repetitive attempts and efforts. And that led to not only hope but somewhat the conviction that the idea, the concept that we had 10 years ago could actually be realized. And what happens gradually, and you probably don't see that in annual reports or you don't fully realize it when you look at the company, a company that specialized in hormones now shifts to being an expert in drug delivery. Now that is a whole new business.

And what you've seen a couple of weeks ago is that we had the audacity or the courage to announce that we are going to put the next generation of drug delivery. And our aim is controlled release. Controlled release means injecting a drug that has a release curve over weeks or months. That is quite important because it means that the patient doesn't need to seek the doctor's attendance on a daily basis. That has an enormous advantage as you've seen with the implant that we deployed over 2 decades. So suddenly, the ambition came through, as I think Professor Rosenfeld said, not by sheer persistence, but by putting the right people together.

We had a number of teams in Singapore, and we invested considerable money in Singapore. But we knew that we wanted to have one specific talent. And I share you the anecdote how this goes in drug development. And that specific talent was contacted in 2018. But he was comfortable in his pharmaceutical job and was not looking for a new employment, but we knew that this man was one of the very few on the planet that could actually formulate the way we wanted.

It took 3 years to talk to him and convince him to join the ranks. That is persistence. It's keeping in contact with the people you've identified on the planet and understanding that they make the difference. Now attracting is one, but the retention is second. He formed the team around him, and that's the team that is at the moment delivering and realizing our ambition. That is how it goes. And that is the value of time in research and pharmaceuticals.

What does the future look like? What are the catalyst or the points that you look at? A house with a branded and a generic product, a house that now is developing its own release formulations. And what we did, we answered to the demand from the market. Every investment banker over the last 20 years had asked us, but could you deliver this peptide transdermally through the skin?

Well, I've told you last year, and that was also on record, all the big cosmetic conglomerates on the planet had filed patents for melanocortins as early as the '90s at the turn of the century, but all of them walked away because it was so complex. But there was another reason -- there were 2 reasons actually.

The business of a cosmetic company like the big French ones and the American ones is not to pigment patients because pigmentation brings out freckles. It brings out sunspots. Their business is to bring the next generation of products every season in order to beautify the skin.

Then there was the risk -- the perceived risk of melanoma. Oh my word, if you induce melanocytes, could it be masking or inducing melanomas? These were enough reasons for the cosmetic companies to walk away from melanocortins. Now our onus, our work was actually to prove over 2 decades that the supply, the administration of melanocortins was not inducing melanomas. On the contrary, it rather has a protective effect.

The longevity, the time value in pharma is actually pursuing that mission in order to show the medical and dermatology community that is not hazardous or dangerous. Now if you say that at the beginning of the journey in an investor. No one would invest. You would chase all the investors out of the room. So silently, we worked to prove and disprove the notion that the activation of melanocytes, pigment-producing cells would be dangerous. I can say hand on heart today after 2 decades that we have proved that.

When safety is therefore no longer in contention, you proceed and realize the ambition that the investment community wanted, that is to get these melanocortins to the skin in order to induce, activate, assist [ self-broadening. ] And that is what we believe the holy grail in cosmetics.

But the black swan doesn't stop there because now we are a pharmaceutical company adding a cosmetic component to the business, which is holy alien. There is no competitor in the world that translates its technology from pharmaceutical to cosmetic. For that, to be successful, you need one word, visibility. And where do you start? Well, you start where the prescribers are and those that profess to be the experts, and that's the North American dermatology community, 20,000, of which 8,000 have practices or multi-physician practices in the United States.

So in the staged approach, we understood that for our franchise to be successful, we need visibility and we need an outreach to those that are actually going to dispel and disseminate the notion of melanocortins. And we're in the middle of that. Our presence at the American Academy of Dermatology in 2025 was the first in '26, we'll do the same.

The other part that I need to stress is innovation, performing novelty or in patent terms, finding the inventive step is not only on the level of technology, your entire approach has to be novel. The way you communicate, the way you market, the way you package, the way you distribute. It is a red line that has to go through the company because putting a novel product on the table is not sufficient.

To give you an example, with the liquid formulation that we are developing was the need since it didn't exist to our liking or to our needs to develop a device. So we have an in-house engineering team that is developing devices. If we believe that we're innovative in vitiligo, it also means that we seek avenues to use AI in order to optimize the process. So innovation is multifaceted. It is not just the science of the technology. It needs to be, call it, a culture in the company not to be afraid to do something. So a branded generic product, a formulation delivery platform and product cosmetics.

In terms of business, I downplay and I do that consciously, the importance of cosmetics to the pharma business. For me, it was always -- and I say that on a personal basis, it was a nice to have. It is answering to the market once. But what I've learned in this industry and this industry is cosmetics is that the products can be very efficacious. But what matters is really the marketing, the branding, the distribution. That is 99% of the success. And that is how I see this venture progressing.

Is it at the same pace that you wish to see? Probably not. But what it does, it cuts the risks in bite sizes. So this year, this calendar year, we had a number of publications in the Financial Time in the fashion and cosmetics section. We had the Vogue. We had the wired, Condé Nast, one of the largest publishing houses in the world.

And we now see that there is a demand created where Tatler, Cosmopolitan come to us and what are you developing in-house? Can we write an article about it? In my view, that is the beginning of visibility. But don't forget, a pharmaceutical house developing cosmetics is something like a misnomer that doesn't exist. So that's novelty again. And that's going to take time.

But what I've learned in life, my professional life and my personal life is that if you got an ambitious task or journey, you map it out and you do it step by step. And the requisite to succeed is not technology, it's people. If you got the right team to make the ascent. And in my view, we're not bad.

Then there's the question about share price. I hear more about share price here in Australia than elsewhere. I don't know if there is a disconnect between the value, the intrinsic value and share price. I talked about it at length last year. What I do know is that a number of factors don't aid, don't assist. But if you take a much wider view, in general, in innovative biotech, you see that these companies, certainly single platform companies go through an enormous appreciation when it leads up to an inflection point like an FDA approval or an EMA approval. But as soon as the balloon goes up, it also goes down after.

But earnings, revenues, generally, and I can't say that for all, but for most of the analysis, do not bring as much fantasy as the hope of a market that you can't yet model because once the model of the analysts is written, the reality kicks in. We have seen that in this company because at two occasions when we had any -- or hardly any assets where we hardly had any cash or revenues, the company ballooned up to $2.5 billion.

So I'm coming to the end of this dialogue with you. This is the 20th year, has been very good. It has been beyond my expectation with the melanocortin that already existed 25 years. But this team will continue because the science and the willingness or the eagerness to bring this forward is not abating.

But if you hold a thought that controlled release holds a promise in pharmaceuticals and medicine, not because I say so, but because it published and many of the large pharmaceutical companies write about the need to have one, then let your fantasy run riot and understand what kind of peptides and proteins and drugs you can put in a controlled release formulation. So I'm very privileged to see the beginning of that kind of work that took 10 years of funding actually to see progress. And I can assure you that every Christmas, I wanted to abandon the project, and I'm glad I didn't.

So on this note, I leave you and I'm sure you've got some questions.

Thank you very much, Philippe. Well, first, we will now come to the general questions. First, we will start with questions received prior to the meeting. We call on the Head of Investor Relations, Malcolm Bull, to read these out. And then I will -- actually, Malcolm will direct the question to the appropriate person for these. Thank you, Malcolm.

Thank you, Jeffrey. Good morning, everybody. There's a number of questions we have received as Jeffrey mentioned, and I've grouped them into several categories, and we'll go through them. Some of the questions may have been already answered or partly answered, so directors can add or ask me to move on.

First one is capital management. A frequent question focusing on the share buyback. Various questions such as, is the buyback still in play? Why have you not executed that to a significant extent? And can it -- if it's not in play, can it be restarted? So I think we'll ask Matthew Pringle to address that particular issue.

Yes. Thanks very much. Well, the share buyback expired last year and was automatically renewed for a further term. And its first tranche for reasons probably before my time, wasn't fully absorbed. And in the second term, we had some large blackout periods and also some periods where the Board made a conscious decision not to enact because of information we had, so we didn't act on market. So the buyback actually lapsed automatically through lack of use.

Now the mechanism we've got for a buyback, too, is that we just can't go on the market and buy $1 million worth of shares. Our capacity to buy and our timing is very restricted under the rules. We also felt that the impact that would have on the share price would be negligible because of those restrictions and the very low volumes we could actually enact at any point in time. And so we decided that a better course of action was to preserve the cash rather than use it through that buyback mechanism. It just wasn't an effective mechanism to really have an impact on share price or to benefit shareholders in our view.

Okay. Thank you. On the clinical pipeline and translation to commercial revenue streams, Philippe, this is for you. And I'll read it a little bit verbatim from the shareholder.

Given CLINUVEL is narrowing its clinical development focus to vitiligo, ACTH-related disorders and porphyrias, what are the key milestones or regulatory/reimbursement hurdles you anticipate in the next 12 to 24 months? And how will these milestones translate into materially diversified revenue streams beyond our existing business of SCENESSE for EPP.

Or ACTH -- there's a question to it?

Well, it's on how we will develop vitiligo, ACTH and porphyrias into commercial revenues and the milestones along the path, absolutely.

Well, let's start one by one. So vitiligo is advancing its trial. We completed the trial, the last patient last visit was last month. There's a 6-month follow-up, then there is 6 months for analysis. So that's going to be somewhere in the second half of '26.

We anticipate -- there are 2 agencies in the world. There's EMA and FDA. We slightly changed our tech because it's a very dynamic environment. From the interaction we've had with EMA, like in EPP, we believe that it's good to go to Europe first and U.S. second. We will have 2 interactions, one with European Medicines Agency and one with the Food and Drug Administration. Shortly after that, we will start the 107 study. We -- it's going to be quite a similar design as the 105. That takes you another year out plus analysis. And then it's to be seen whether the results stand up. I mean we're all assuming that the results are good. But if the results are good, as good as we've seen in the case report, then that leads to the submission.

ACTH is a bit close because we've completed the manufacturing. The drug master file is going to be incorporated in the submission. The submission is going to take place in the first country in 2026. And then it's about the regulatory turnaround. I don't know what it is at the moment. At the moment, everything in -- certainly in the U.S. is delayed because of the government shutdown. So I can't give you definitive time lines, but first is the submission in '26, the regulatory interactions and then the start of 107.

Okay. You may wish to stay there, Philippe, because we're going to move on to PhotoCosmetics. This is an interesting one because the shareholder is saying, is it possible that melanogenesis PhotoCosmetic product may be used in the future by a vitiligo patient when near total repigmentation is achieved through the vitiligo program treatment as an additional supplement on the face as an example.

It's a smart question. Smart question. It is. Melanogenesis is an expensive word for the natural tanning process. And what you do in vitiligo, what you try to do systemically with an injection is to bring back the pigmentation. That is medical tanning. So a transdermal that assists these patients is, of course, of value, and that was the idea. Because if you give vitiligo patients an additional transdermal, it gives credibility and trust to the consumer because you used it from medicine to consumerism. So the answer is yes.

Okay. On vitiligo, particular question on the vitiligo expert panel. Is it still active? And what is their assessment of CUV-105?

Yes, there are 2 panels. There's an expert panel and there's a scientific panel. They have 2 functions. An expert panel looks at the merit of a drug or new drug in a new disease. These are academics. They are head of a department. You form them around the table and once and twice a year, they convene and they issue an opinion.

The scientific expert panel in vitiligo has a different function. They have a say in the design of the protocols. And that's important because as a company, you want to rely on the medical community to have an input in the design of these protocols. And that has value when you go to a regulatory agency because every disease, whether it's cardiovascular or neurology or disease in neurology or vitiligo, there's a finite pool of experts in the world.

And these experts are either called as a witness by the regulatory authorities to provide an opinion or if they are on the side of the sponsor of the company, you take them along and you make your case. And so yes, that's still active, yes.

Okay. You can take a break, Philippe because the next few questions are to other directors. This shareholder is asking, and I think this is for you, Jeffrey, to clarify Philippe's actual intentions and time frame for departure.

I did address this in my own address to shareholders, but Dr. Wolgen's employment agreement does expire 30th of June '26, as has been said. The Board is overseeing his succession and will provide an update in 2026.

Last question relates to directors' ownership of CUV shares. And Sue we'll get you to answer this. So I was talking about the convictions of the directors to CUV, and we've heard statements from 2 directors seeking reelection where I think there's a lot of passion and commitment to the company. But they're saying, why has the Chair only over 3,000 shares? And why do none of the 3 newly appointed directors hold no shares?

Well, the investment in the company, of course, is up to personal judgement and of people's own financial stewardship. I think regardless of ownership of shares by the directors, it has nothing to do with their commitment and loyalty and the very hard work that they give for the success of the company regardless of any share ownership.

Right. We have a very professional Board who are committed regardless of share ownership. That concludes, Mr. Chair, the questions that have been pre-submitted.

Thank you, Malcolm. So we open the floor to questions from you, the shareholders. Who would like to ask a question? Yes. Could you -- again, I remind you to state your name, your shareholding?

Samantha Taylor. Can you hear me? 15,000 shares. My question is in regard to AI. And there's been a lot of change, a lot of change over the last couple of years and especially the last year. And how is that impacting on your ability to speed up the research process? Your analysis?

Yes. You're reading our minds as a Board because we discussed this at length yesterday, and I'm going to pass to Philippe to speak about AI in CLINUVEL's operations.

But just before you answer, so not only speeding up the research process and the analysis, but also those how you're going to implement AI for that process going forward. And I understand that's challenging, but I'm really interested in your response.

Okay. Thanks for that.

It's really -- I'm burning to tell you but I can't. The last 3 years I've been thinking how can we implement AI in our business. In pharmaceuticals, the first talk was can you do faster screening on molecules and peptides to speed up drug discovery. That's the very beginning. I didn't think the value would be there.

We -- without giving everything away because there is IP pending, but we are using AI in vitiligo, and that is enormously exciting because I see the results of the project. My estimate is that we will be the first company active in vitiligo that is presenting this to a regulatory agency, and that's all I can say. But it's not so much speeding up, but it's an assisting tool that adds value.

Yes. I mean I just -- in terms of machine learning, can you just give a bit more about what kind of AI you're using and in which part of the process, just to give us a bit more insight?

We hired 2 engineers that are programming and writing the annotations, but I can't tell you. I want to tell you but I can't. Yes.

It's in development. So any other questions? Yes.

Gavin Scott, 3,500 shares, recent shareholder. First, I've got 2 questions. First one really is around the capital allocation, and thank you, Professor Rosenfeld, for going on and explaining some of the capital allocation decisions. I understand we've now got $4.90 or thereabouts of cash in the company.

My question really, the first question is how much is enough? I understand we need a buffer in order to be able to progress our clinical development. As that figure keeps creeping higher, at what point do we say that this money is no longer required? I also understand the buyback is difficult. Have we -- has the Board considered an off-market buyback or another form of returning excess capital to shareholders? That's the first question.

Right. I might direct that to Philippe, the first part of your question, if I may.

I had a number of meetings this week in Melbourne, one with a larger investment bank and their analysts and the equity capital markets head said to me something that I've learned. He said there is no such as sufficient cash in the biotech, and that resonates with me.

You will see from us projections over 3 years in the new year like we've done in 2021 to '25, and we came under. Our estimate for the operational expenditure and capital expenditures, we just have enough, taking into account delays, objections, rejections that may or may not come in the future. We're getting to a point where we just have enough to execute all the plans.

The share buyback is really a contentious issue. The first principle to start off with, and I appreciate as a recent shareholder that you started, you're probably not privy to all the discussion we had in this room or elsewhere. But an R&D company in our life science -- in life sciences that does share buybacks is not staying really within their remit because the research money should be -- or the money should be replowed in research. So as a matter of principle, redistributing wealth at this stage is a bit bizarre. We're doing that now for 7 years, I think, Malcolm, in the forms of modest dividend.

This is not a lazy balance sheet. This is actively managed because we know what we want to achieve. And it gives you a runway that may be extended or out of your control factors that may affect the funding requirements. Now if you start buying back shares, a company of this size at this stage, there are really 2 assumptions that you make. The first assumption is that the company would have access to capital in the future. Well, there's no guarantee for that at all. If you look at the graveyard in the U.S. in biotech at the moment, funding is scarce.

The second assumption on doing a share buyback is that it will materially affect the share price. Well, Matt talked about this. Sometimes we have prior knowledge on who the sellers are or those that actually wish to exit. And it is a zero net exercise because you know that those were expressed to exit, are using the share buyback or the moment that you can trade, and it's about 20% per day that you can trade, are going to use that actually to exit. So you constrict your share capital, you, therefore, affect your liquidity adversely. If we use our millions and you don't see a significant rise in share price, then why are you doing it?

It's also a bad sign for two reasons, and I'm very sensitive to that because I'm at the call phase of this company. When you talk to insurers, and they are not stupid, they made a business in tracking pharmaceuticals and their products. And I remember sitting in Switzerland, where the counter side, the Swiss insurers at the annual report, the cash flow statement, the P&L in front of them, and they knew exactly how much profit we're making.

The moment you start issuing dividends and buying back shares, these insurers are going to lower the price. You're going to get the price pressure. So it's -- in this industry, unless you're Pfizer or Glaxo, that's a different matter altogether. But when you are at this end of the curve, I think a share buyback sends a very bad signal to those that actually matter, and that's the payers. So the totality is no, but it's not an absolute no because if the share price would drift to $2, $4, you'd be mad not to do it because you need to understand your intrinsic value. But at the moment.

Thanks very much, Philippe. Any other questions from the floor? You had the second one. Sorry, I thought the share buyback was the second one.

The other question is directed to Dr. Wolgen. Congratulations on a 20-year career building a remarkable company. And from my understanding and research, it's been done fairly unconventionally. You've taken a very different approach to many other people who may have taken on this company 20 years ago. My question is, what advice would you give to the Board about the characteristics that the next CEO ought to have in order to guide this company forward?

Well, the only advice I can give as the largest shareholder. I can't have any other capacity, but first of all, these are very kind words, but the word congratulations are never at place because the journey is not finished. So it's been good so far, but success is very frail. It can end the next day. And you've seen that in Enron and Parmalat and Lehman and that could happen to us. So I don't like celebrating. That's a principle.

But we succeeded thus far by default because every other avenue had been tried for 25 years because the story started in 1980. So there were only 1 or 2 avenues left. But the next girl or boy needs to be passionate and incessantly obsessed by bringing this forward and not see this as a job for 3 or 4 years, which is pretty standard in our industry. And he or she needs to have the capacity to keep the team together because that these are the assets. So it's going through the candidates and finding the right person.

Thank you, Philippe. Yes, sir.

Andrew Dixon, not sure why I need to reveal my shareholding, but a few thousand shares. Philippe, a question for you.

I actually direct the question.

Sorry.

I'm -- let's hear the question.

I asked a question to Philippe, I think it was 2 or 3 years ago. Time has flown by, whether CLINUVEL had developed afamelanotide as a cream to penetrate the skin. He wasn't able to answer for obviously, disclosure reasons. Does it still remain an idea? Or are we any closer to revealing some absolute certainty in that?

Okay. So...

One more after that too.

We'll ask Philippe that question about the penetration of afamelanotide through the skin.

I can't -- there has been overnight an article in the Financial Times where I was quoted. But he -- and I urge you to read it because that is answer. The assumption was that we would drive afamelanotide through the skin. We never said that. We said we would drive melanocortin through the skin. And that is our research efforts. And afamelanotide is a molecule of 1647 delta that will never go through the skin.

So our efforts as seeking the grail is to drive a melanocortin through the skin that then assist and activate the melanin, the melanogenesis. And that is ongoing and human testing is underway, but it's not as simple as you stated. It needs to have a lasting effect. You need to be able to apply it once or twice a day, not 6 times a day and so forth. So there are a number of kinetic challenges, but it's my life ambition to see that in some shape or form as CEO or shareholder, I don't mind, but it's technically possible.

Okay. And one follow-up. There seems some excitement about the breakthrough in January about the slow release liquid. Just in terms of the business value, again, I'm obviously not a biochemist. But in terms of comparing the slow release liquid to an implant, what's the sort of the wow factor which shareholders could potentially be excited about?

Again, I'll hand over to Philippe. But the advantage of the liquid or the gel is the variability in the dosage that you can put in the gel as opposed to a fixed dose in the implant. Would that be right, Philippe? I've answered the question. Does that answer it for you?

It's a bit sad because it happens at the very end, but my estimate is that this market could actually be bigger than vitiligo. So that's why I'm excited about it.

The flexibility is the key and what goes in the gel. Any other questions? Where -- yes, sir.

David Warren, I have 15,000 shares. I'm wondering, I think in CLINUVEL's recent history, a lot of time shareholders have been asking when the next revenue stream will come online. I know you're developing 3 different areas. Do you have any more visibility on when you expect the next -- which of the 3 areas you expect to produce revenue and your best estimate of when that might be?

Again, I might hand over to Philippe for the -- again, a question of time lines and which announcements we will come first. I would preface it by saying that whatever we do, it takes time. It takes patience. And sometimes the time lines stretch, and that's what happens in biopharma. But to give you more clarity on that, I'll hand over to Philippe.

The regulatory time lines are not in our control. And so to deviate a little bit, the expansion of the label took 1.5 years. Now if we would sit in this room and we would analyze what you needed to do to expand the label, it's very little work. On the basis of logic, you could do that in one afternoon, but it took 19 months.

These factors are not in my control or our control. But what I do know is you need sufficient -- have sufficient cash to navigate through it. My estimate where I am today, but don't hold me to it, but I would believe that the ACTH would be the first revenue stream as a generic. That is if the regulatory turnaround is fast enough.

All right. Thank you, Philippe. Any other questions? I think we've given everyone a good go. So I'd like to conclude this -- the Q&A, and we will announce the results later today on the ASX Market Announcements platform.

This concludes the meeting. I thank all those in attendance and wish you all good health and fortune. Thank you.