Significant events during the quarter
Enzymatica continued its international expansion. Sanofi launched ColdZyme® in France and Italy under its established cold remedy brands Physiomer® Stop Virus and Zerinol® Virus Defence.
Enzymatica signed an agreement with MS Pharma for MENA – the Middle East and North Africa, and also expanded the agreement with STADA for Russia, Poland, Ukraine and the CIS countries (Commonwealth of Independent States – formerly Soviet republics), as well as for the Nordic region, excluding Sweden. In total, Enzymatica has entered agreements for ColdZyme in about 50 markets.
Significant events after the quarter
Enzymatica made two strategic new hires, including Malin Richter as Director Operations and Kristoffer Ahlerup as Director Commercial – both with extensive experience from the international pharmaceutical industry.
Impact of the coronavirus pandemic
Key figures for group
|(SEK million)||Oct–Dec |
|Full year |
|Full year |
|Gross margin, %||61||77||68||73|
|Cash flow from operating activities||-8.2||-0.1||-10.7||-37.6|
|Average number of employees||20||17||18||19|
From the chairman: Strong ending to a very successful year
2020 was a highly successful year for Enzymatica. We increased sales by over 80% during the year and for the fourth quarter, we almost doubled sales and showed a positive operating result. Our international expansion gained momentum through many distributor agreements and the launch of ColdZyme in new markets. ColdZyme also strengthened its market position on the Swedish market. We achieved a milestone in that ColdZyme was recertified and was approved under class III for medical devices in the EU. In addition, an EU patent was granted for one of the key components for ColdZyme, which provides patent protection for the product until 2035. Finally, we completed several studies with ColdZyme, including a clinical trial with elite athletes in the UK and, importantly, an in vitro study with ColdZyme and SARS-CoV-2 – the virus that causes COVID-19.
In 2020, we increased our sales by 81%, from about SEK 61 million to SEK 111 million. It was mainly sales in new markets, primarily in Europe, that contributed to the growth, as well as sales in the UK which rose sharply during the first quarter. The company’s strong growth was generated despite a decline in established and more mature markets, especially during the fourth quarter because of the pandemic, which also had a negative impact on our sales in these countries. Both cash flow from operating activities and the operating result (EBIT) for 2020 improved sharply, from just over SEK -37 million to just over SEK -10 million, and from just under SEK -42 million to SEK -12 million, respectively, mainly related to the strong sales growth and effective cost controls.
The operating result for 2020, which was SEK -12.1 million, was negatively impacted by social security costs of SEK 10.3 million for employee warrants due to rising share prices.
During the year we delivered according to our growth strategy, with strengthened market position in existing markets, as well as expansion to new markets together with strong partners. At the beginning of the year we entered into an agreement with Keyuan Trade, a subsidiary of one of China’s largest pharmaceutical companies, Shanghai Pharma. During the year we expanded our distribution agreement with STADA. First with 19 markets in Europe, primarily in Eastern Europe, and then with 14 markets covering Russia, Poland, Ukraine and the CIS countries (former Soviet republics), and finally four Nordic countries. In all, our agreement with STADA currently covers about 40 markets. In the fall French Sanofi, one of the world’s largest pharmaceutical companies in consumer health care, launched ColdZyme in France and Italy under its own well-established brands, which we believe will accelerate market penetration. Enzymatica also signed an agreement for MENA – the Middle East and North Africa – with MS Pharma. In all, we now cover over 50 markets with ColdZyme and the product has been launched to consumers in about 30 of these markets. Our partners plan to launch ColdZyme in the remaining markets in 2021 and 2022. Exact launch dates depend on regulatory approval. After Enzymatica has entered a distribution agreement for a new market a registration process begins, which is relatively time consuming for a medical device product. Even if about 12-18 months for countries outside the EU could be a bench-mark it can vary inbetween different markets.
Sales on more mature ColdZyme markets such as Sweden and Denmark were negatively impacted by the coronavirus pandemic because of measures such as social distancing and a focus on hand hygiene. In addition, the number of visits to shops declined. These measures resulted in fewer and milder colds. For example, the total Swedish cold remedy market declined by almost 20 percent in value in 2020, while ColdZyme’s sales to consumers dropped by about 12 percent. Our product thereby strengthened its position and increased its market share from 6.5% to 7.1% for the full year.
In 2020 ColdZyme was recertified as a class III product according to the EU’s medical device directive (MDD). The notified body EuroFins reviewed Enzymatica’s procedures and the complete documentation for the product regarding safety, efficacy and product claims and found that it had achieved a level that meets the requirements for the highest classification of medical devices in the EU. It is truly an indicator of quality and helps to make the product even more attractive in discussions with highly reputable international distributors.
Additional patent approvals also strengthened confidence in our cold spray and the company. First, an EU patent for one of the key components was approved, providing the product with protection until 2035, and then additional patents for indications other than colds were granted in Japan, Russia and Australia.
In 2020 we also conducted several successful studies with ColdZyme. The one that drew the greatest attention showed that in an in vitro study, ColdZyme reduced the presence of the SARS-CoV-2 virus by over 98% in 20 minutes.
In the fourth quarter, Enzymatica’s sales almost doubled, from about SEK 22 million to over SEK 42 million – an increase of 91% compared with the corresponding period in 2019. The increase was mainly attributable to sales in the new markets, such as France, Italy, Portugal, Switzerland, Romania, Czech Republic, Hungary and the Baltic States. We also achieved a positive operating result for the quarter, SEK 1.8 million, compared with SEK -7.0 million for Q4 2019, driven mainly by the surge in sales. Social security costs of SEK 1.6 million related to employee warrants had a negative impact on earnings. Cash flow from operating activities was SEK -8.2 million, compared with SEK -0.1 million for the corresponding period the previous year. The decrease is attributable to an increase in accounts receivable as a result of higher sales.
Enzymatica has also had a strong start for 2021. In January, Enzymatica made two strategic new hires, Malin Richter as Director Operations and Kristoffer Ahlerup as Director Commercial. Both have extensive experience from the international pharmaceutical industry, which will be valuable for our continued expansion. The expanded agreement with our contract manufacturer Recipharm, which ensures a significantly increased production capacity at two of their facilities in Spain and Italy, is also incredibly important for our growth. This is also the case for the investments we have made and will make in the production facility on Iceland, as well as the purchase and deployment of a new ERP system.
With a strengthened organization, expanded production capacity, MDD class III recertification, further strengthened patent protection, and broader collaborations with our partners, I continue to be optimistic about the coming quarters. The sales trend will likely be uneven on a quarterly basis since it will be dependent on launches in new markets and because of the uncertainty related to the effects of the pandemic on the more established markets. But the foundation that we laid in 2020 bodes well for the continued exciting development of Enzymatica.
Bengt Baron, Executive Chairman of the Board
For questions about this report, please contact:
Bengt Baron, Executive Chairman of the Board, Enzymatica AB
Tel: +46 (0)70859 30 09 | Email: email@example.com
Therese Filmersson, CFO, acting CEO, Enzymatica AB
Tel: +46 (0)708- 40 72 24 | Email: firstname.lastname@example.org
This information is information that Enzymatica is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact person set out above, at 8:30 a.m. CET on Thursday, February 18, 2021.
Enzymatica AB (publ) Corporate identity no.: 556719-9244
Mailing address: Ideon Science Park, 223 70 LUND
Street address: Scheelevägen 19, Ideon, Lund
Tel: +46 (0)46- 286 31 00 | email@example.com | www.enzymatica.se
Enzymatica is listed on the Nasdaq First North Growth Market. The Company is traded under the ticker symbol ENZY and ISIN code SE0003943620.
Enzymatica’s certified advisor is Erik Penser Bank. Tel: +46 (0)8463 83 00, Email: firstname.lastname@example.org
ABOUT ENZYMATICA AB
Enzymatica AB is a Swedish life science company that develops and sells health care products for primarily conditions of the ear-nose-and-throat region. The products are based on a barrier technology that includes marine enzymes. The company’s first product is the medical device ColdZyme®, a mouth spray against common cold. The product has been launched in about 30 markets on 3 continents. The strategy is to continue to grow by developing more health care products and strengthening the company’s position in existing markets and expanding into new geographic markets through established partners. The company has its headquarters in Lund and is listed on Nasdaq First North Growth Market. For more information, visit: www.enzymatica.com and www.enzymatica.se/en/section/media/press-releases