Ann: Appendix 4C and Activities Report - March 2023 Quarter, page-42

Unknown Executive

00:53:42

Okay. I got the first question from [ Jing La ]. Is there any update on the 177Lu or 225Ac, TLX591 in global or China?

David Cade

Chief Executive Officer of Asia Pacific

00:54:01

I'll just repeat the question. I think the question was, is there any update for lutetium TLX591, was it TLX250 or TLX591? I heard TLX591.

Christian Behrenbruch

Co-Founder, MD, Group CEO & Executive Director

00:54:15

Okay.

David Cade

Chief Executive Officer of Asia Pacific

00:54:15

Yes.

Christian Behrenbruch

Co-Founder, MD, Group CEO & Executive Director

00:54:16

Yes. So we are expecting that in the next -- roughly within the next quarter, so roughly in the next 3 months that the ProstACT GLOBAL and the ability to start a study in China will align. Our strategy so far has been to take an IND package from the U.S. and bring that to the NMPA. And so that's really the trigger point that's the catalyst for that. So it's a very high priority for the partnership this year and to really start to be able to get some preliminary clinical experience in China in a timely way, so that we can include Chinese patients in the ProstACT GLOBAL study as well. So the team is certainly working towards that objective, and we'll be able to provide updates on that in the coming months. It's a good question. Thank you for asking it. Next question?

Unknown Executive

00:55:24

If you have any question, you can just try to DM me or chat in the chat box?

Christian Behrenbruch

Co-Founder, MD, Group CEO & Executive Director

00:55:30

Yeah, I see, what is the expected ASP? Well, we haven't given guidance yet on drug pricing in China. But Frank, do you want to -- or Weikun, do you want to make any comments on nuclear medicine value proposition in China in terms of drug pricing?

Chao Zhou

CEO, Executive Deputy Officer & Executive Director

00:55:48

Drug pricing? So...

Christian Behrenbruch

Co-Founder, MD, Group CEO & Executive Director

00:55:48

Yes. We haven't really given guidance yet.

Chao Zhou

CEO, Executive Deputy Officer & Executive Director

00:55:51

Yes, yes, no, no guidance for this. Yes. But it's a -- thanks for the question. It's a big question. You want to ask that as a price policy and reimbursement policy in China, I kind of keep talking for lot of hours for this question. So it's a special market as I mentioned before. So that's why I think Telix and other partners try to find a local partner to move in China. What I can say is, currently, the economic is keeping going up in China, and the GDP is keeping rising. So the expenses in medical areas is keeping rising. So the patients have a lot of demand for these products. So I think this is first point. Second point is on pricing, it's a complete question. We need to consider the economic -- medical economics and to consider the capability of the patients to pay the price. So it's hard to give you a very clear or rough guide for this, but we need to balance to make sure most of the people could get this product and to make sure we also will keep some profit for this. Yes.

Christian Behrenbruch

Co-Founder, MD, Group CEO & Executive Director

00:57:26

And it's really a two payment market. There's the eventual prospect of reimbursement, but that's a long journey, and then there's an out-of-pocket component, which is actually quite the mistake to think of China as a low-cost country because it's not, but it is a very high volume country. And David mentioned before the United Imaging micro EXPLORER PET scanner. This is an example of how Chinese innovation is actually leading the world and building high-throughput nuclear medicine. So this is the market that we're dealing, it's not a low-cost market, it's a reasonably priced market, but the bifurcation between private pay and or private pay and insured versus government pay is much more -- it's a much brighter line than it is in the rest of the world, I think that's fair to say.

Weikun Tang

Executive Chairman

00:58:13

Yes. And I -- Chris, and I want to add some comments about this question. I think it's really a very, very good question for -- especially for China market. I think for TLX591-CDx product, we need to know that in the past almost 10 to 20 years, there is no, like this kind product approved in China, and there is no competitor in China even in the clinical stage, we need to know this. And also, we can see that from the U.S. market, this product shows very good -- very, very good clinical benefit for the patients. So in -- if this product could be approved in China, I think it's a good product, and we have a very huge market in China. Yes.

Christian Behrenbruch

Co-Founder, MD, Group CEO & Executive Director

00:59:21

So just in the question around the royalty agreement, we haven't disclosed any details around our royalty agreement with Grand Pharma for either the diagnostic or the therapeutic programs. But what I will -- what I am comfortable saying is, is that the -- and I think David mentioned it and is transparent with respect to our public disclosures, the relationship around the imaging is a rather more of a distributor relationship with the sort of typical economics that you would expect for distributor partnerships, I describe it more as a profit sharing arrangement. And that's because these programs are pretty late-stage in development, and it's a small amount of clinical effort that's required to really make that last step. But for the therapeutic programs, it's more of a royalty bearing sort of standard pharma out-licensing, again, very typical industry standard sort of ranges for what you'd expect to see.

Christian Behrenbruch

Co-Founder, MD, Group CEO & Executive Director

01:00:16

So I think the most important thing is to understand that the economics are very different between the imaging and the therapy, and I think that's about the extent to which we can all disclose. Yes. Thank you. It's a reasonable question to ask. And obviously, product economics will become more of a focus as we start to launch. There are another -- maybe we have time for one more. I know we've gone over the hour. I know it's fairly generic, do we have any plans to raise capital? I think that question is out of the scope of both companies, what do you think?

Chao Zhou

CEO, Executive Deputy Officer & Executive Director

01:00:57

I think for you this question...

Christian Behrenbruch

Co-Founder, MD, Group CEO & Executive Director

01:01:04

I think both companies are in financially in good shape, we're both earnings-driven businesses now. One of the nice things about working with Grand Pharma is we really have a lot of similarities in our size and scale, a little bit bigger than we are. But Grand Pharma is not a Chinese company. It's a global company. And that's what makes it very easy to work together. So I think that we're both public companies. So anything is possible.

Chao Zhou

CEO, Executive Deputy Officer & Executive Director

01:01:33

Yes.

Christian Behrenbruch

Co-Founder, MD, Group CEO & Executive Director

01:01:34

I think let's just -- one other concluding question. Maybe, Frank, this is a good one for you or for Weikun, what is the value for Grand Pharma products sold to date?

Chao Zhou

CEO, Executive Deputy Officer & Executive Director

01:01:49

In China, China Grand Pharma has a globally radiopharmaceutical business like Sirtex and also the sales in China. So the sales volume wise, maybe around RMB 1.5 billion globally.

Christian Behrenbruch

Co-Founder, MD, Group CEO & Executive Director

01:02:18

And growing.

Chao Zhou

CEO, Executive Deputy Officer & Executive Director

01:02:19

Yes. And growing, yes.

Christian Behrenbruch

Co-Founder, MD, Group CEO & Executive Director

01:02:21

Growing. We will wrap it up.

Chao Zhou

CEO, Executive Deputy Officer & Executive Director

01:02:25

Yes, please.

David Cade

Chief Executive Officer of Asia Pacific

01:02:26

Well, thank you to the audience for dialing in, both from the China side. I know there's been a lot of interest from Grand Pharma's shareholders and also from the Telix side is I can say there's quite a number of folks that have dialed in from Australia and also outside of Australia. So thank you for diligently listening to what we had to convey to you today. I think it really does demonstrate that we have a tight partnership that's been extraordinarily fertile and that's only going to grow over the coming years. Would Frank or Wei would like to make any closing remarks?

Chao Zhou

CEO, Executive Deputy Officer & Executive Director

01:03:05

Yes. Thank you again for the investors and analysts to join this meeting. And again, very pleasure to have this opportunity together with Telix to do this. And I think this is our very strong partnership with both parties. And lastly, I want to say with the core product and the strong team and the very strong medical need, I think we need to speak up to, as Chris mentioned, to the first priority for both to bring the product into clinical as well as possible because patients are waiting for us. Let's wrap. Yes.

Christian Behrenbruch

Co-Founder, MD, Group CEO & Executive Director

01:03:48

Thank you.

Weikun Tang

Executive Chairman

01:03:50

Thank you.