From the CEO

Although this report is supposed to reflect and comment on events during the three first months of the year, it will be rather forward looking given to the big news of the day in Peptonic.

No one has avoided to be affected by the Covid-19 pandemic during the first months of the year. This relates to both our private lifes and businesses. Strong recommendations by the Public Health Agency in Sweden to stay home, only to travel if really necessary, avoid meeting people etc. has clearly decreased the number of pharmacy visits.  This, in turn, has decreased sales in retail pharmacy shops, which also can be seen in the sales of VagiVital. After having reached sales records in January and February, retail sales in March dropped markedly. On-line sales didn’t decrease by the same magnitude. On a positive note, Lloydsapotek will start selling VagiVital in all of their 80 retail shop from mid May.

Försäljningen via nätbutikerna i Norge och Danmark har utvecklats väl. Ännu är volymerna små, men trenden är klart positiv.

Sales of VagiVital via the webshops in Norway and Denmark has increased month by month. Although volumes are still small, the trend is clearly positive.

The order to China of 53,000 unis will be shipped this month, which is good news. The products will be used for introducing the product and the brand to gynaecologists and prescribers. Users of the product will be asked to participate in a survey to collect ’real life experience’ data, which will be used to support the registration application in China.    

Recently, we have submitted two patent applications. One relates to the use of VagiVital to treat symptoms associated with vestibulodynia. The other relates to an intimate wash formulation based on VagiVital in combination with an oil. We now investigate the prerequisites for expanding the indication of VagiVital to also include vestibulodynia. It may require a small clinical study. The intimate wash is an in-house development project. The product is planned to be launched during Q1 2021.

The recruitment to the clincal study on breast cancer patients has stopped due to the Covid-19 epidemic. The patients already enrolled will complete the study, but some measurement cannot be performed because the study subject are not allowed to visit the clinic. The last patients are due to exit the study in June. Results of the study are expected during Q3 2020.

Financial loss for the period was -5,807 Mkr. Sales were 1,781 Mkr. Marketing, manuractruring, transportation, distribution and business development costs were 4,4 Mkr. 

Under årets första månader har mycket arbetet lagts ner på granskningen (så kallad ’due diligence’) av Lune Group Oy Ltd. inför ett eventuellt förvärv. Vi har grundligt tittat på bolagets hela verksamhet, men framför allt på försäljningen i olika länder – både fysiskt och on-line. Vi har gjort djupare analyser av den finansiella delen av verksamheten, samt av den fysiska och digitala försäljningen.

During the first three months of the year much time and effort has been invested in the due diligence project related to the contemplated acquisition of Lune Group Oy Ltd. (Finland). We have thoroughly looked at the entire business of the company, in particular, at its global sales – both retail and on-line. We have performed deep analysis of the financials of the business, and of the physical and digital sales activities.

An important part of the mission of Peptonic is to grow and expand the product portfolio within women’s health i.e. through in-house product development, distribution collaborations or acquisitions. Through the acquisition of the Lune Group Oy, Peptonic takes a big and important leap in building its business for the future. The acquisition enables the merger of two strong brands within women’s health and selfcare with several synergies already identified. Through the acquisition of Lune, Peptonic gets access to a global distribution network that is already up and running, also in the USA. This allows VagiVital to be launched sooner than previously planned. With the two brands Lunetteâ and VagiVitalâ the Company’s customer base is broadened to cover women of all ages. – from the teens to post menopause. This provides the possibility to grow sales of current and future products through smart product positioning, in-house product development and new collaborations. Peptonic also becomes more attractive as a collaboration partner, both in new markets and for companies looking for partners for the Nordic markets. Through this acquisition Peptonic’s view on the importance of a sound use of pharmaceuticals and evidence based and sustainable selfcare.

Lunette (www.lunette.com) was founded in 2005 by Heli Kurjanen and has earned its place as a top global menstrual cup company through its continued focus on quality, safety, sustainability and inclusivity. Lunette has experienced year-over-year double digit growth since its inception resulting from its tireless commitment to reproductive rights and global sustainability. Lunette employs 15 people of which 2 in US through its subsidiary Lune North America. All of Lunette’s products are made in its home country of Finland. Lunette products are sold in approx. 40 countries via retail and in approx. 100 countries on-line. Sales in 2019 were 3.7 MEUR and EBITDA 9 TEUR.

Now we are looking forward to an exciting future in Peptonic.

Stockholm, May 14^th,  2020

Johan Inborr

CEO

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