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Thank you for standing by, and welcome to the ResApp Health quarterly results investor call. [Operator Instructions]I would now like to hand the conference over to Mr. Tony Keating, Chief Executive Officer and Managing Director. Please go ahead.
Thank you, Alberta. Good morning, everybody, and thank you for joining our quarterly results conference call, the last for the 2021 financial year. I'd like to welcome our shareholders, employees and members of the Board of Directors to the call.In my last quarterly update, I talked through our strategy for the commercialization of our products. Our focus for the last quarter has been on executing on that strategy and getting ResApp's products more widely available to doctors and patients globally.Telehealth is our main focus. It's in telehealth where we offer the only scalable way for telehealth clinicians to accurately evaluate the respiratory health of their patients.During the quarter, we continued to work closely with Medgate in Europe and expanded our Australian presence with the signing of a commercial agreement with Doctors on Demand. These are 2 well-respected telehealth providers, and we are pleased that they have chosen to work with us to use our technology in their day-to-day clinical operations.In June, based on strong results from the pilot, Medgate extended that pilot program for 2 months to gather additional real-world data and further optimize integration into Medgate's clinical workflows. We are now coming to the conclusion of that extension and are confident that we will move forward with commercial agreement with Medgate shortly.This will be a significant milestone for us. Not only will it allow us to deploy ResAppDx commercially into the well-developed European telehealth markets with a leading telehealth provider, but it will also demonstrate to telehealth providers and clinicians globally that we can provide the tools needed to diagnose and manage respiratory disease in a remote setting.Our agreement with Doctors on Demand further expands our Australian footprint, building on our existing partnerships with Coviu and Phenix Health. Doctors on Demand are a leading Australian telehealth company, and importantly, have several large Australian corporates as customers. One goal here is to increase the use of ResAppDx by doctors and patients, but the partnership will also allow us to gather valuable real-world used data.An important step in the commercialization of medical devices in many markets is obtaining reimbursement. Obtaining reimbursement is an important part of our strategy to accelerate adoption of ResAppDx in countries where reimbursement is the primary method of health care payments. Australia is one of those countries. Obtaining reimbursement often requires real-world data to demonstrate the health and economic benefits of using our products in practice. The agreement with Doctors on Demand will provide this real-world data, which will build our evidence based for future reimbursements and submissions, an important step towards obtaining reimbursement for our products in the Australian market.I'll also add that our agreement with Doctors on Demand will see them promote SleepCheck to 125,000 patients as part of their virtual sleep care offering. We've reduced our direct-to-consumer SleepCheck marketing over the last few quarters as we focus more on our partner and growth strategy for SleepCheck and have a number of discussions active here. To further expand the availability of SleepCheck, we expect to file a 510(k) submission of a prescription-only version of SleepCheck to the U.S. FDA in August.The other strategic focus for ResApp is in emerging markets where there is a strong clinical need as doctors there lack access to the diagnostic services that doctors in developed worlds take for granted. After successfully completing our evaluation with Ilara Health during the quarter, we cemented our relationship by [ fully ] appointing Ilara to promote market and sell ResAppDx in Kenya.Ilara is a great partner, and they've partnered with over 250 clinics across the 4 largest cities in Kenya. ResAppDx is now being used in a number of Ilara's partner clinics, and we expect that number to increase over the coming months. We've seen great feedback from both clinicians and patients in the field, and we are excited about how this is rolling out.COVID-19 is still a major challenge for governments, for health care providers and for everybody across the world. We see multiple opportunities for our technology to play an important role both during this pandemic and also after the pandemic has subsided. Our COVID-19 strategy is balanced around 3 areas: screening for COVID, managing patients with COVID and helping identify and managing long COVID. We see our technology having a major impact in all 3 of these areas.Collecting cough data with correlating high-quality clinical data is a key to moving forward here. We're currently recruiting patients in the U.S. COVID-19 study. The study allows patients to enroll and collect their cough sounds using an iPhone app and then obtain a real-time PCR test to confirm COVID-19 stats.We are in advanced discussions for a number of additional studies, both to increase the size of our data set, but also deepen the data set by collecting additional clinical data as well as longitudinal data from patients. We are confident that with the right data, we have a great opportunity to deliver algorithms to make a real difference in the clinical management of patients with COVID-19.We were pleased to recently see AstraZeneca Japan publicly announce their iDETECT study, which uses our cough counting technology as part of a larger effort to use machine learning for interstitial lung disease detection in lung cancer patients. From discussions with the majority of the large pharmaceutical companies, we know that cough frequency is an important outcome measure in clinical trials as well as for disease management. Cough frequency is not just important in respiratory disease, but applicable across a wide range of disease indications. Partnering with pharmas to provide our cough counting technology into trials like this is an important part of our strategy for driving near-term revenue, and we have a number of advanced discussions underway. In May, we also welcomed Brian Leedman back to the Board of Directors. Brian was instrumental in the founding of ResApp and has many years of experience in Investor Relations as well as a deep understanding of health care investment requirements. Brian is passionate about ResApp and it's always great to have someone so passionate involved in helping us achieve our goals. Finally, we are grateful to both our existing and new shareholders who participated in our capital raise in April, as you can see from our quarterly cash flow report, this additional capital puts us in a great position as we continue to execute on our commercial strategy, which we strongly believe will deliver strong returns to our shareholders. Thank you for listening to the call this morning. I'd now like to open the line for questions.
[Operator Instructions] Your first question comes from [ Danny Billings ], private investor.
Just if you could give us an update why the uptake isn't being used by the telehealth company that we've signed up in Australia?
So Danny, if you're talking about Coviu and Phenix, so the deal that we have done with Coviu and Phenix, so I think there are 2 reasons there. So one, with Coviu, as we've explained previously, all GPs in Australia that are using the Coviu platform are actually using the healthdirect platform, which is a white-labeled version of Coviu's platform. And at the moment, there are no plug-ins available on that platform, so ResAppDx is not available on the healthdirect platform. We're working closely with Coviu to try to make that happen and to talk to healthdirect and to make all plug-ins that are available on Coviu available on the healthdirect platform. But unfortunately, at this point in time, that's not -- that hasn't eventuated.With Phenix, yes, telehealth volumes in Phenix' platform are low. We're working with them, but there's also some structural challenges just generally in direct-to-consumer telehealth that Phenix has, which is basically seeing very low volumes through Phenix as well.
Your next question comes from [ Jim Baker ], private investor.
I wonder, is Ilara paying us for the work that they're doing currently? Or is it still in sort of pilot?
Ilara are paying. So each test that is being performed is paid.
Okay. And the other question I had was ResAppDx and FDA approval. I haven't heard anything about that. I might have missed it at the beginning, but...
Yes. So ResAppDx, we've filed a pre-submission request to follow our discussions with the FDA, follow on our existing discussions with the FDA. We are currently waiting to schedule a meeting with the FDA. With the COVID-19 pandemic, the FDA is quite busy, and we still expect that meeting there to happen in the second half of this calendar year.
Your next question comes from [ Mark Rowley ], private investor.
So a question about Medgate. When -- assuming that it's a successful contract, are you going to provide any details on the trials around how many doctors were using it, number of users per day. "I guess market's not going to view this as it's going to be another sign-on. And assuming it will be something like Phenix and Coviu, there's no revenue that comes along with it. But you could give some confidence to the market if you could actually prove it's being used. So is there going to be more information when something's announced?
Look, in general, the use and the number of telehealth consultations, the number of tests and things are confidential to Medgate. And so we're not able to disclose those numbers. I can be -- I can confidently say that, yes, it's being used. And that what we found from the trial to date has been that the use has delivered performance similar to what we've seen in our clinical trials. So we're very happy that the use is performing well, and the clinicians are using the tests in the right way and getting good results. So unfortunately, we're not able to provide breakdown of number of tests, and we're not really prepared at this point to provide any guidance around a number of tests and revenue until we're in a more stable position once we've seen how uptake has occurred.
Okay. Can you provide any more insight into the number of clinics in Keyna using it? Are we talking single figures? Double? Dozens? Anything along those lines?
Yes. Look, I mean again, this is confidential information to Ilara Health in this particular instance. Look, we're talking in the 10 to 20 range at this point in time, and we're seeing that grow fairly substantially on a week-to-week basis.
Yes. Okay. I guess the thing that we don't see as an investor is actual demand from doctors. We don't see revenue coming through. We don't see doctors using it. I'm not saying that they're not. But I guess what evidence is there that doctors actually want this product?
So I think the key is that the clinicians are driving people like Medgate to talk to us. I mean Medgate are looking at implementing this -- or have implemented into their clinical operations. They're not going to do that unless doctors are comfortable that it is doing the right thing clinically and add value clinically. And so from our perspective, the use of ResApp in Medgate, the use and the feedback that we're receiving from Ilara in Kenya, for example, gives us good confidence that clinicians see value in using ResAppDx.
Okay. Yes. Because I just think, unless there's some evidence, it's going to be very difficult to raise capital next time. So I'm really hoping that in the next 6 months, we can see something in black and white?
Look, I think we're in a fortunate position, as we said. We raised capital earlier this year. We agree that our focus is now on getting use of the technology by clinicians, driving adoption. I think we've got some good foundation deals with Medgate, with Doctors on Demand, with Ilara, that over the next 6 months, we will drive use of ResAppDx in those partnerships, and that's our main focus.
Looking forward to seeing for next quarterly, Hopefully, there's some evidence there to [ sustain it ].
[Operator Instructions] Your next question comes from David Morris from Morris Superannuation Fund.
Previously, you guys announced a number of hospital evaluations both in Germany and in London and Cambridge. Obviously, COVID-19 came along and put them on the back burner. But can you give us any indication that those evaluations are continuing or haven't been forgotten?
Yes. So it definitely haven't been forgotten. Those evaluations -- all those evaluations were to be carried out in emergency departments. And as we've said before, with COVID-19, clinical research and emergency departments has basically stopped, as well as emergency departments have dealt with the COVID-19 pandemic. We are at a position now where we are starting to restart those studies and looking at potentially starting those this winter in the Northern Hemisphere. But obviously, that's dependent on COVID-19 and dependent on the emergency departments, especially in the U.K. But absolutely not forgotten, definitely on our road map and has a potential to start this winter as well.
Okay, Tony. May I also just ask a question regarding the phosphorus study. The first participant was announced on May 17, and now, we're at the end of July. And you were aiming to collect about 1,500 participants' coughs or breathing. How are we going with that number? Are we coming close to the ramping up of the study itself?
Look, I think that we are in a position -- so we're not providing a full update on that COVID study at this point in time. I think recruitment is slightly slower than we expected, primarily because of the low incidents of COVID in the U.S. that we've seen. We've seen that incidents in the U.S. pick up and increase fairly significantly over the last few weeks. And so we're seeing increased recruitment because of that. But we'll provide an update next month or so, providing an update on where we are with that study.
Okay. Would you consider -- let's hope you don't have to, but would you consider maybe doing a similar study in Australia? As you know, Sydney is getting in lockdown and so forth, so there might be some right cases that you would at least test. Is that a consideration with you guys?
We're certainly considering Australian locations. Again, the challenge is the positive test rate in Australia is so low. I think we're very fortunate that the test rate is not even a percentage, while somewhere like the U.S. is up to 4% -- 5% or 6% in some locations. We're looking at other options as well, other countries, other study locations, as I said, in the talk to both increase the number of patients that we've got in our data set, but also to broaden that data set. So to get more clinical data as well as get longitudinal data from patients, which may tell us about disease progression. So it's definitely not -- the end game is not just the U.S. clinical study. We're looking at other options. But Australia still has very, very low test rates of COVID.
Your next question comes from [ Tyron Carroll ] from [ Gully Carroll ].
Tony, basically same as the COVID question before, so.
Okay. Great. Hopefully that answered your question. Thanks, [ Tyron ].
Your next question comes from [ Kevin Wong ], private investor.
Tony, this is Kevin. Just a quick one. Regarding the Medgate commercialization. So you're having that discussion right now with Medgate. I'm just wondering, are those discussion also -- and also, I guess the investor presentation, also being presented to all the big health insurance company because my understanding of the Switzerland health ecosystem, the way it works is that, pretty much it is compulsory and by legislation, that everyone has their health insurance at the very basic level. And part of that reimbursement is that the health insurance company actually direct them to go to Medgate or telehealth as their first triage or point of call. And then on the back of that, right, so if they got respiratory disease and whatever, they'd probably end up using our Dx app.So I guess it's very important when you're having those discussions, [indiscernible] getting Medgate on board and signing commercial deals, but you're not getting the reimbursement model coming through the health insurance company. So just wanted to get a bit more details around that because I think that's the gap at the moment, and that's why you're probably getting the same questions as that from the other guys previously.
Yes. So I think there's a couple of angles to this -- a couple of answers to this question. So first of all, our discussions with Medgate at the moment and our commercial discussions with Medgate are not dependent on reimbursement. And so therefore, that -- reimbursement is on our road map and we're reviewing reimbursement options for Switzerland, and we'll look at that post this first deal with Medgate.I think Medgate relationship at this point in time is looking very positive for a good long-term relationship with Medgate. Medgate obviously have strong relationships with all those insurance companies. They're the Medgate customers. And so therefore, we see that strong relationship. But I guess from general, the first deal with Medgate does not rely on reimbursement. And we will continue to work with Medgate to possibly enhance or increase the reimbursement option to us later down the track.
Okay. So does that mean that when we go live, say in next week, for Switzerland, for the guys to use it, they're actually paying out of pocket on top of their reimbursement from the health insurance company when they use Medgate?
So that's a Medgate decision, and that's a Medgate internal matter. That's not something that we are -- we're not forcing payments on patients. Medgate is -- it is essentially the payer in this situation.
So Medgate will be paying us per use?
I can't talk about the [indiscernible] deal. But the intention is that patients are not paying out of pocket.
Okay. So this could be just another offering that they tag on, another AI capabilities they have discussed and published quite a fair bit in the last few months. Okay. All right. No, that's good. And I just want to get some clarification around that, that's all.
[Operator Instructions] Your next question comes from [ Jeff Warring ] from [ Warring Super ].
Like you were all hanging out for the reimbursement to come through that -- I just had a question about the sales process. Two steps. One, the first one you're doing really well, which is signing up your corporate customers and channel partners. I guess the next step is the patients that come from those channel partners. What's the sales process for that? Is that something that ResApp can influence? Or is that something that's you're reliant on the corporate partner? Or is that something that -- where there's no sales process, it's just the offer it now kind of like -- can you give you me a little bit of insight into that?
Yes. So I think this -- it's a really good point. I think it's a very important point that it's not just these corporate deals with a Medgate or a Doctor on Demand or an Ilara Health even. There are multiple parties here involved in that sales process as such or the use process, that we need to get comfortable in the process. So you're right, patients are a big part of that. We've actually gotten a lot of positive feedback from patients very, very quickly. It's a very easy to use test, gives people a lot of confidence that their doctor is getting a lot of information. Patients have been quite smooth in adopting the technology.The other important factor, and probably the most important factor, is the clinicians themselves, and getting those clinicians up-to-speed to understand what the test is able to offer them from a clinical perspective. And that really is working closely with partners like Medgate, with Ilara, with Doctors on Demand to educate their clinicians and get their clinicians reading the peer-reviewed publications like the recent one on COPD exacerbation, the diagnostic errors paper that were also published recently. And really building that experience using the test and building their expertise in how to use the test and how the test adds value.Once we've had a chance to work closely with clinicians, what we found is clinicians really see the value and appreciate the value, especially in the telehealth setting and especially in the emerging market setting, where in both of those, they don't have the traditional tools that they would normally use.So it's a really important question, really good question. It's not just about Medgate. It's about Medgate, and then Medgate's clinicians, and then Medgate's patients. And so it is a very full sales process of connecting all of those people together and selling them on what ResApp can offer them individually. And we offer all of them different things as well.
Okay. So that makes it clear. So it's not a product where the patient comes and asks for it, where they have a need that they recognize. They need to be educated, and the doctors need to be educated, too, you're saying. And that part is what's making it so slow, I assume, since it's a customer education sales process.
Yes. The patient doesn't ask for the test. That definitely does not happen. So in all cases, in Medgate's case, in Coviu's case, in Phenix' case and in Doctor on Demand case, they -- in all telehealth -- in most telehealth settings, these days you're asked a few screening questions upfront about your condition, what's bothering you. And effectively, on those answers to those questions, if they indicate respiratory disease, then you pass through our test. So it's not really -- a patient doesn't have to make an active decision to use ResAppDx. It's just part of the workflow that they see when they sign up for telehealth consultation. And that's how it should be. We don't need to and we don't want to have to educate every patient to request for ResAppDx. It should just be part of the telehealth experience. And in the next stage, once the doctor gets the results, what do they do with it and how do they evaluate that result, and then how do they use that in their management and treatment of the patient.So it is a complex clinical workflow to make it very smooth for the patient. And again, so they don't have to make the decision and don't have to stick their hand up and say, "Hey, I need a ResAppDx test." That's not what we want. We want it to be get smoothly embedded into that telehealth workflow so that the patient gets to see doctor quickly, and that doctor has all the information that they need to make a decision about the treatment.
Okay. So that helps. So it's about customer's education and the clinicians, and how well the -- I guess the partners educate the clinicians in the value of this to themselves and their patients. Okay. Good job on signing up all these partners. You've got the big names.
Your next question comes from [ Alex Brown ], private investor.
Tony, my question is, you mentioned advanced conversations with some big pharma. In terms of the time lines, like do you have any sort of indication on sort of when those discussions will come to fruition, or any sort of outcome from those?
Yes. So look, it's always very difficult to time commercial discussions, especially with global players. But we are confident that over the next quarter, that we should see additional pharmaceutical deals. Obviously, AstraZeneca Japan is a very strong deal for us, and we're very pleased with that deal. And we're working hard with AstraZeneca, both on the cases that we work with AstraZeneca Japan but also broadly -- more broadly with AstraZeneca. But look, I think in our case, as we say, we think that the cough counting technology can be a short-term, near-term revenue driver for the company.
Okay. And just in regards to what you're discussing in terms of your customer journey just before, have you guys actually mapped that out and got a visual what the customer journey looks like? I mean different journeys that they might take in using ResApp. It's just a good thing to actually view and my takeaway from the question is about how it operates?
Yes. Look, telehealth workflows tend to be quite varied by customer. So Medgate's workflow is quite different, and that's actually quite confidential and valuable. And it's one of the reasons why Medgate is so successful, is they have mapped out these journeys over a number of years in the clinical decision pathway. It's a very different map to, say, Doctors on Demand or, say, Coviu. So yes, we have mapped them all out. But point well taken that perhaps we need to do a bit of a better job of educating the shareholder base, and I'm happy to try to put something together and include that going forward.
Your final question comes from [ Richard Black ], private investor.
My question is just the take-up of ResAppDx in Europe with telehealth providers. I mean we had seen approval now for 2 years. We've had a sales director over there for 1.5 years almost. But since, maybe we've signed up 1 deal. And I just would like you to comment on what the strategy is and what we need to do to pick that up?
Yes. So I think, clearly, having a reference customer or a lighthouse customer in Europe will make a significant difference to the speed that the commercial pipeline is moving in Europe. So Medgate is obviously our #1 target, and we've focused a significant amount of resources to have a successful pilot, and then to have a successful commercial negotiations to a commercial deal. So that is a major part of our strategy in Europe. Medgate are also probably the most well-respected, most mature telehealth provider in Europe. So I think they're a very strong partner to be that reference customer. I think, unfortunately, we have been somewhat hamstrung by COVID-19 in Europe, which has seen telehealth companies focused heavily on scaling their business, which -- while it's been great for the telehealth industry, and clearly, is great for us long term, it's really, I guess meant that investment in technologies such as ours by telehealth providers have been on the back burner for the last 18 months. I think we've seen that change this year, over the last sort of 6 months, and I expect that to continue to change, and we should see that commercial pipeline running faster.So I think Medgate shows that not only can we do a deal, we can implement in Europe, we can deliver a solution in Europe, which I think will then -- will be able to leverage to get further things happening. So I would say 2 things. COVID-19 has probably made things hard, and I think we're seeing that easing off. And I think the second one is getting someone like Medgate, which we did focus and have focused substantially on because we know how important that is and we know what a great partner they will be. I think that's a great -- should be a great trigger to start kickstarting things to move through the pipeline.
Okay. So there's other players that you think are just sitting back, waiting to see how this goes before pulling the trigger on a deal?
I think -- we are in discussions with multiple other players at various levels of advancement in the pipeline. Medgate will help us push those through the pipeline further.
Yes, sure. And just with the COVID-19 detection, I mean the way I see it, if we can detect COVID given sort of accuracy, then going to sell this to a telehealth provider is going to be like shooting fish in a barrel. Is that the way you're looking at deploying the COVID-19 test if successful?
I think we're looking at COVID-19 across more than just screening. So obviously, screening of COVID-19 is a really important opportunity for us, and we're looking at that, whether it is screening for events, whether it's screening for transportation, schools, et cetera, places like that. I think there is an opportunity there for screening in telehealth, for sure. You can think of it like a flu test, which is what you potentially get going into an emergency department. And I think it's possibly a warning signal to people who are in a telehealth consultation, for the clinician to consider COVID in particular cases. I think PCR and rapid antigen test will still be the gold standard, but we play a very different role, a very scalable role where you have mass numbers of people that need to be tested.I think from our perspective, looking at what the long-term future here, the long-term future here is 2 factors. One is managing people with COVID. So we're probably looking at an environment in the future where COVID is just around like the flu, and being able to identify patients as they progress with the disease, whether they progress into pneumonia, for example. That's a very important factor to know whether the COVID is causing pneumonia, which is driving them towards hospitalization. So that management of patients is really important. That's why I talked about collecting longitudinal data. So collecting data from patients over time. So coughs every couple of days as the disease progresses. And then I think long COVID emerging really is a key issue as well. We don't know much about long COVID today, but we do know it significantly affects lung function, probably because of some fibrosis in the lungs and other factors. And so we also see opportunity to help those people manage that disease by being able to monitor it. So...
Is that maybe a wearable device?
Potentially. Look, I think the wearable device has applications in the clinical trial setting for things that we're talking about, the pharmaceutical companies as well. But potentially, whenever we start to talk about management and monitoring of disease, using a wearable device that's able to listen 24/7, has its benefits.
I will now hand back to Mr. Keating for closing remarks.
Thank you, operator. And thank you, everybody, for your questions. I'd like to close by thanking our shareholders and staff for their continued support. We've made a number of significant advancements over the last financial year, which I think sets ResApp up for a very strong year of growth for the next financial year. So thank you all for your time, and have a great day.
That does conclude our conference for today. Thank you for participating. You may now disconnect.