CEO comments

2024 has been a year where customers continued to show interest in our services, but also a year characterized by slow decisions on our offers and where many customers continued to have challenges in financing their development projects. Something we experienced throughout the year, resulting in lower turnover and sales. Our assessment for 2025 is that the customers' situation has improved but will continue to require intensive sales work on our part to ensure increased conversion of our outstanding quote pipeline of approximately SEK 45 million. We have a continuous and close dialog with our customers about our technology and our unique 
Services.

At the end of April 2025, the FDA approved the publication of the study report of our joint study for our In-Vitro module DissolvIt®. We are very pleased with the results of this comprehensive and groundbreaking study, which met both our primary and secondary study objectives and confirms both our development hypothesis and previous results from our proprietary studies with DissolvIt®. For ISAB, this has a potentially very high commercial value and is considered a breakthrough for our DissolvIt® technology.

We also plan to launch an upgraded version of the XposeAli module for In Vitro, now with Microperfusion. This is something that biological customers lack today and has been requested for a long time. The combination of DissolvIt for mainly generic customers and XposeAli Microperfusion for biological customers makes ISAB a unique provider of In Vitro services with the same platform technology. Furthermore, in combination with our well-established modules on the In Vivo side, we are able to secure a leading position in delivering high quality services in the field of In Vitro-In Vivo Correlation (IVIVC).

Given the market and customer challenges in 2024, we have reduced operating expenses proportionally and in line with our revenues and have ended the year with a stable cash position. As of the end of December 2024, the company's cash and cash equivalents amounted to SEK 4.4 million. As announced, we will carry out a rights issue of approximately SEK 15 million to be able to accelerate market initiatives with the aim of increasing sales and to have the necessary resources to capitalize on the built-up stock of offers.

We are also in continued dialog with potential partners for the clinical application of PreciseInhale.
Management and the Board are working on a 2025 plan to ensure that our services and technology will generate new customer projects, the publication of FDA data, new growth areas and evaluate several strategic opportunities for the company.

Huddinge, May 27, 2025 

Manoush Masarrat

CEO

Selected financial data in summary

Financing

Following the Board's decision on April 7, 2025, an Extraordinary General Meeting was held on May 8, 2025 to carry out a new issue of units with preferential rights for existing shareholders of approximately SEK 15.2 million. Through this issue, the Board of Directors and the CEO assess that the company will have sufficient capital to finance the business going forward based on the currently decided plan.

Total investments in R&D expenditure are shown in the table below:

Significant events during the financial year

• On January 22, the company announced that it has entered into a strategic partnership with the German company Actarmo Medical GmbH. This is in line with the company's stated strategy to expand its portfolio of inhalation research services. Actarmo has an established customer base and expertise in formulation development, analytical testing under full good manufacturing practice (GMP) and consulting services for all aspects of inhaler delivery devices. With this collaboration, ISAB's potential market (TAM) is expanded by 30% to a total of approximately EUR 630 million.
• On March 11, the company announced the publication of its feasibility study for clinical use of the PreciseInhale platform in the prestigious European Journal of Pharmaceutical Sciences. This enables in-depth collaboration discussions with companies active in the clinical market that ISAB did not have access to before and a market with an estimated value of SEK 5 billion.
• On April 10, the company announced that it had been invited by the FDA to present the company's technology during the FDA's public workshop GDUFA (generic Drug User Fee Amendments) on May 20, 2024. This workshop will be open to the public and aims to inform about the ongoing research that can contribute and improve the development of generic drugs.
• On May 21, the company announced a product order with a value of approximately 700 KSEK. This order is from a recurring customer who is among the top 5 in the world in generics and has ISAB's PreciseInhale instrument and DissolvIt module installed for several years.
• On June 13, the company announced an IRS order with a value of approximately 600 KSEK. This order is from a recurring customer that is one of the top 10 pharmaceutical companies in the world.
• On August 12, the company announced its intention to call an Extraordinary General Meeting to elect Ulf Ericsson as a new board member. Ulf Ericsson, born in 1966, has 28 years of experience in life science and specializes in pharmaceuticals, inhalers and inhalation formulations. He has worked at Astra Zeneca for 17 years, mostly in senior positions with global responsibility. He is currently an independent consultant in business development and strategy in life sciences.
• On August 15, the company announced several orders with a total value of approximately SEK 600 thousand. These mostly concern service assignments (IRS) from ISAB's regular customers.
• On October 10, the company announced the publication of the successful study with the company's In Vitro module, XposeALI® together with Karolinska Institutet. The publication was made in Frontiers in Medicine (Pulmonary Medicine Section).
• On October 16, the company informed about the latest status of the ongoing DissolvIt study together with the US Food and Drug Administration (FDA), which is one of the most important decision-making bodies for how drug development should be conducted.
• On December 17, the company announced two new sales orders from repeat customers. These orders were for product service with a total value of EUR 33,900.

Significant events after the reporting period

• On January 10, the company announced a new IRS order with a value of SEK 212,000 from a repeat customer who is a leader in generics and biosimilars.
• On January 13, the company announced its launch plan for the upgraded version of the XposeAli module, now with Microperfusion. This module is intended for the biologics market with a potential of approximately USD 4 billion.
• On April 7, the company announced plans to carry out a rights issue of approximately SEK 15.2 million if fully subscribed. The aim of the issue is to accelerate commercialization activities and increased sales.
• On April 15, the company announced a new instrument order with a value of EUR 41,000 from a large pharmaceutical company that is a returning customer to ISAB.
• On April 24, the company informed the market that the US FDA has approved the publication of study results from the company's joint study with the FDA regarding the company's In-Vitro module DissolvIt.

Expected future developments

ISAB is steadily expanding its commercialization activities. In collaboration with leading pharmaceutical and CRO companies, modules are being developed for PreciseInhale and the company's service portfolio (IRS), which entails increased functionality and thus also a broader range of both products and services.

As of December 31, 2024, the company's cash and cash equivalents amounted to SEK 4.44 million.

Operating income

ISAB's revenues consist of sales of PreciseInhale systems, the DissolvIt module and contract research services (IRS). Contract research services through the Inhalation Sciences Research Services (IRS) business area amounted to approximately 41% (66%) of operating income during the reporting period.

Operating expenses

Amounts are stated in SEK thousands. Figures in brackets refer to the corresponding period last year unless otherwise stated.

Results and financial position - the reporting period (Jan-Dec)

Operating income relating to goods and services amounted to SEK 11 047 (17 504) thousand.

Operating expenses amounted to SEK 15 702 (18 199) thousand.

Selling and marketing expenses

Sales and marketing expenses during the reporting period amounted to SEK 4 917 (6 164) thousand.

Business development and administration costs

Business development and administration costs during the reporting period amounted to SEK 4 041 (4 920) thousand.

Research and development costs

Research and development costs during the reporting period amounted to SEK 6 744 (7 115) thousand. The costs relate to consumables and consultancy fees through development activities relating to the PreciseInhale systems and its modules.

Personnel costs amounted to SEK 7,214 (9,220) thousand, which have been allocated to the cost items R&D, sales and business development costs according to the allocation key with 40%, 40% and 20% respectively.

Depreciation amounted to SEK 1 126 (1 117) thousand and is included in R&D costs.

Other operating income and other operating expenses

Other operating income amounted to 516 (642)

Other operating expenses amounted to 0 (162)

The operating result amounted to SEK -5 076 (-3 756) thousand.

Profit after financial items amounted to SEK -5 147 (-4 744) thousand.

Profit after tax amounted to SEK -5 147 (-4 744) thousand.

Earnings per share before and after dilution amounted to SEK -0.34 (-0.36). Cash flow during the period amounted to SEK -3 380 (5 986) thousand.
Cash flow per share amounted to SEK -0.22 (0.45).

Cash flow per share before capital contributions amounted to SEK -0.22 (-0.31).

Cash and cash equivalents as of December 31, 2024 amounted to SEK 4,445 thousand compared to SEK 7,825 thousand on December 31, 2023.

The company's equity as of December 31, 2024 amounted to SEK 7,807 thousand compared to SEK 12,954 thousand on December 31, 2023.

Equity per share as of December 31, 2024 amounted to SEK 0.51 compared to SEK 0.85 on December 31, 2023.

The company's equity ratio as of December 31, 2024 amounted to 74.15% compared to 71.30% on December 31, 2023.

The earnings trend is in line with the forecast and expectations established by management during the year.

Multi-year overview

Order intake during the period 3 583 tkr (15 543) 

Order backlog at the end of the period 617 tkr (8 966)

For more information, please contact:
Manoush Masarrat, CEO
E-mail: manoush.masarrat@inhalation.se
Mobile: +46 (0)73 628 9153 

About Inhalation Sciences Sweden AB (publ)
Inhalation Sciences Sweden AB (publ) develops and commercializes world-leading instruments and services for research into inhalation. The company’s patented lab instruments PreciseInhale® and DissolvIt® enable researchers in the pharma industry to make drug pipeline decisions at an early stage, saving time and resources for R&D departments, and enables researchers in academic institutions to define how aerosols and small particles impact our lungs, and so our health, when being inhaled.