Infant Bacterial Therapeutics AB
Annual Report 2022
1!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
We aim to satisfy unmet medical needs in the
premature infant
SIGNIFICANT EVENTS 2022
On January 19, IBT announced that The Connection Study continues after the Data
Monitoring Committee (DMC) had completed its pre-scheduled safety analysis without
any concerns. At the same time a futility analysis was performed. Based on DMC
recommendations and futility outcome, IBT is continuing the recruitment to the study as
planned.
On September 23, the FDA approved IBT’s request for a new Orphan Drug Designation
for retinopathy of prematurity (ROP).
IBT published in the British Journal of Gastroenterology in October an article based on
IBT's “Connection Study” which demonstrates that sustained feeding tolerance (SFT)
is linked to serious disease progression including sepsis and bronchopulmonary
dysplasia, validating the study design. It also highlights the potential to reduce
healthcare costs with fewer treatment days in the hospital.
The company negotiated during 2022 the acquisition of a drug platform that can
prevent antibiotic-resistant hospital infections.
2!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
Infant Bacterial Therapeutics AB (publ)
Annual Report January 1 – December 31, 2022
Table of Contents
IBT IN BRIEF 3
IBT’S HISTORY 5
MESSAGE FROM THE CEO 8
IBT’S PIPELINE 10
DIRECTORS REPORT 19
OPERATIONS 19
SIGNIFICANT EVENTS DURING 2022 19
SIGNIFICANT EVENTS AFTER THE FISCAL YEAR 20
SELECTED FINANCIAL DATA 21
FINANCIAL DEVELOPMENT 21
RISKS AND UNCERTAINTIES 23
ENVIRONMENTAL RESPONSIBILITIES 26
SUSTAINABILITY 26
LEGAL PROCEEDINGS 26
CORPORATE GOVERNANCE 26
PUBLICATION 26
CALENDAR 26
ANNUAL GENERAL MEETING 27
BOARD OF DIRECTORS RECOMMENDATION OF APPROPRIATION OF PROFITS 27
INCOME STATEMENT 28
BALANCE SHEET 29
STATEMENT OF CHANGES IN EQUITY 30
STATEMENT OF CASH FLOWS 31
NOTES 32
AUDITOR´R REPORT 52
CORPORATES GOVERNANCE REPORT IBT AB 56
DEDUCTION OF CERTAIN KEY FIGURES 67
SHARES 67
MANAGEMENT 69
BOARD OF DIRECTORS 70
!
The annual report is published on the company’s homepage, www.ibtherapeutics.com
and is distributed in printed form when ordered. Orders may be placed via
info@ibtherapeutics.com. The annual report is also published in Swedish.
3!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
IBT IN BRIEF
Infant Bacterial Therapeutics AB (“IBT”) is a public company domiciled in Stockholm. The
company’s Class B shares are since September 10, 2018, listed on Nasdaq Stockholm (IBT B).
Infant Bacterial Therapeutics AB (publ) (“IBT”) is a pharmaceutical company with a product in
clinical phase III with a vision to develop drugs influencing the infant microbiome, and thereby
prevent or treat rare diseases affecting infants.
IBT is currently developing the drug candidate IBP-9414. The ambition for IBP-9414 is to
become the world’s first approved probiotical drug with the goal to prevent life threatening
diseases in premature infants including Necrotizing Enterocolitis (NEC) and sepsis by conducting
sound stomach-and bowel development in premature infants. IBP-9414 contains the active
compound Lactobacillus reuteri, which is a human bacterial strain naturally present in breast
milk.
The product portfolio also includes another project, IBP-1016, for the treatment of gastroschisis,
a severe and rare disease affecting infants, IBP-1118 to prevent ROP (retinopathy of prematurity),
a growing and serious condition that often leads to blindness among prematurely born babies
and IBP-1122 for the prevention of antibiotic resistant hospital acquired infections. By
developing these drugs, IBT has the potential to fulfill unmet needs for diseases where there are
currently no prevention or treatment therapies available.
Vision
Premature infants are the most vulnerable beings on the planet and for them to survive, grow
and thrive they need intensive and specialized care. Although advances in medical care and
handling over the last 30 years have improved survival and well-being of these sensitive infants,
both in the immediate post-natal period and in their subsequent lives, current drugs and
therapies are mostly designed for adults and are not adapted to this specific and vulnerable
patient population. Specific treatment and prophylactic therapy are thus underdeveloped and
there is an urgent demand for drugs designed for the unique needs of the premature baby. IBT:s
vision is to become an internationally recognized and leading company in the development of
pharmaceuticals in the areas of premature babies, gastrointestinal diseases and probiotics.
Mission
IBT develops, and intends to market and sell, effective, safe and effective medicines that can
prevent or treat rare diseases. The company is focused around three areas of developed
competence:
● Gastroenterology - Enabling a healthy gut microbiome extends to multiple treatment
options, especially in combination with advanced gene modification possibilities.
● Premature babies - The need for premature treatment solutions is substantial, where IBT
has established a comprehensive global network of KOLs and institutions.
4!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
● Pharma Grade Probiotics - IBT is a global leader in the development of pharma grade
probiotics, meeting the rigorous quality standards required by authorities such as the FDA
and EMA
Partners
Clinical trials are conducted through collaborations with CRO’s or leading academic research
groups chosen based on their experience and specialist knowledge in conducting clinical trials.
Suitable sites are selected in cooperation with IBT to conduct clinical trials and to initiate the
recruiting process for patients.
5!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
IBT’S HISTORY
2013
● IBT is founded as a subsidiary to BioGaia and commences the development of a
preventive therapy (IBP-9414) against NEC using Lactobacillus reuteri
● IBT is granted Orphan Drug Designation by the FDA for Lactobacillus reuteri for the
prevention of NEC in premature infants
● FDA provides scientific input to IBT development plans
2014
● Pharmaceutical development defining the manufacturing process of IBP-9414
● EMA provides scientific input to IBT development plans
2015
● IBT is granted Orphan Drug Designation by the European Commission for IBP-9414
including Lactobacillus reuteri for the prevention of NEC in premature infants
● Production of drug candidate IBP-9414 according to all applicable pharmaceutical
chemistry-manufacture-control regulations for the safety and tolerability study
● Active IND obtained from FDA for start of Safety and Tolerability clinical trial in 2016
● IBT received approval from the MPA to conduct a clinical trial in Sweden
2016
● Separation of IBT from BioGaia
● Listing on Nasdaq First North
● IBT receives Rare Pediatric Disease Designation from FDA for IBP-9414
● IBT adds new indication for Gastroschisis IBP-1016
2017
● IBT’s share of series B is traded on First North Premier
● IBT completes IBP-9414 safety and tolerability trial and announces that top line data
demonstrate similar safety and tolerability profile in the active and placebo groups
● EMA adopts a positive opinion on the Pediatric Investigational Plan proposed by IBT for
the development of IBP-9414 for the prevention of NEC
2018
● The EGM on January 8 decided on a new share issue amounting to SEK 439.1m and as
of January 31the share issue was fully subscribed. The share issue in combination with
6!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
the directed share issue in November of 2017 generated approximately SEK 543.6m
prior to transaction costs
● In June 2018, IBT contracted Premier Research International LLC, the company’s CRO
during the Phase II clinical trial, to also conduct the company’s Phase III clinical trial
● IBT series B shares are from September 10 traded on Nasdaq Stockholm, Mid Cap (IBT
B)
● At IBT’s FDA meeting following the conclusion of the phase II study, the FDA
recommended that sustained feeding tolerance (SFT) should be measured as a second
primary endpoint in the upcoming phase III study.
2019
● IBT signed its first distribution agreement on March 5, 2019, for its product IBP-9414,
with MegaPharm Ltd. for the Israeli market and the Palestinian Authority’s territories
● On May 19, IBT communicated that an agreement with the FDA had been reached for
how to measure sustained feeding tolerance (SFT) in the phase III study. This definition
was added into the study design.
● During 2019 IBT’s application for clinical trial was also approved in the UK, France,
Hungary and Spain
● IBT announced on July 4, 2019 that the first patient had been recruited in the company’s
pivotal clinical Phase III study, The Connection Study
2020
● The COVID-19 pandemic affects the company’s development work, for example,
activation of hospitals, which has not occurred at the desired rate. As of the date of the
2020 annual report, more than half of the planned hospitals have been activated. IBT's
cash position is sufficient to carry out the ongoing Phase III study, even if recruitment in
the study currently does not take place at the desired rate
● IBT’s clinical study application was approved in Israel in January, in Poland in October
and in Bulgaria in November
2021
● IBT validated sustained feeding tolerance (SFT), according to previous agreement with
the FDA. This implies that the phase III study has two validated primary endpoints.
● Recruitment of patients in IBT’s phase lll-study is strongly affected by the pandemic. A
likely scenario, assuming that the current recruitment level can be maintained, is that the
study can be concluded at the end of 2023. Should the pandemic situation once again
get worse, recruitment may require additional time. However, the pandemic does not
affect the quality in our data or the possibility to conclude the study. Costs are primarily
related to the number of patients in the trial, which means that IBT’s liquidity is
continuously deemed sufficient to conclude the study.
7!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
2022
● On January 19, IBT announced that The Connection Study continues after the Data
Monitoring Committee (DMC) had completed its pre-scheduled safety analysis without
any concerns. At the same time a futility analysis was performed. Based on DMC
recommendations and futility outcome, IBT is continuing the recruitment to the study as
planned.
● On September 23, the FDA approved IBT’s request for a new orphan drug designation
forROP (retinopathy of prematurity).
● IBT published in the British Journal of Gastroenterology in October an article based on
IBT's “Connection Study” which demonstrates that sustained feeding tolerance (SFT) is
linked to serious disease progression including sepsis and bronchopulmonary dysplasia,
validating the study design. It also highlights the potential to reduce healthcare costs with
fewer treatment days in the hospital.
● IBT negotiated during 2022 the exclusive access to a probiotic drug platform that can
prevent antibiotic-resistant hospital acquired infections.
8!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
MESSAGE FROM THE CEO
IBT is working to develop the world's first probiotic medicine for premature babies. Drug
development began in 2013 within the framework of a project that we today call IBP-9414. We
have successfully anchored the development program with the regulatory authorities. IBP-
9414 was the first drug project to obtain Orphan Drug status in the United States for a
preventive treatment against NEC. In addition, IBT is the only company that has succeeded in
obtaining the authorities' permission to administer live bacteria to premature babies. Today,
we have not only succeeded in obtaining clinical trial authorization in the USA, but also eight
more European countries and Israel.
Our clinical development program consists of two studies, a phase II study that we
successfully completed in 2017 which highlights the safety of administering our product to
premature infants. The second study in the program is a phase III study which is now
underway at nearly 1,000 hospitals across 10 countries. The recruitment rate in the phase III
study has increased during 2022 with an average intake of around 50 children per month.
When the 1,400th child has been recruited, per our study protocol, the study will open up to
also include children with a birth weight from 1,001 grams to 1500 grams to participate. It is
therefore reasonable that the last patient of the planned 2,158 prematurely born children is
recruited into the study during the latter part of 2023.
During 2022 we succeeded in validating our second primary endpoint in the study, Sustained
Feeding Tolerance (SFT), in accordance with the manner discussed with the FDA. The
validation demonstrates two things, first that SFT correlates to several serious disease
progressions among those born prematurely and secondly a reduction in healthcare costs as
children reach SFT earlier in life. The results are published in "The British Journal of
Gastroenterology''. The validation confirms that we have chosen an appropriate design for our
clinical development program in which we have two independent primary endpoints, SFT and
the prevention of NEC.
Our work continues to be noticed. "The American Association of Pediatrics' has expressed
that premature children should not receive products that are not approved by the FDA and
mentions our development program as the only development program that intends to seek a
marketing authorization from the FDA. IBT's intention is to give European and other children
the same level of access to medicine as American children.
We have also prepared for the launch of IBP-9414, and in the latter part of 2022 work began
to secure an increased production capacity to be able to carry out a launch. Work on
commercial preparations is progressing in parallel and planned to accelerate in 2023.
While we maintain focus on IBP-9414, it is our intention to broaden our company's
development portfolio. As you know, we are working on a related project in gastroschisis, IBP-
1116, for the treatment of gastroschisis, a serious and rare disease that affects infants. During
the fourth quarter, IBT received Orphan Drug Designation from the FDA for our ROP
9!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
(retinopathy of prematurity IBP-1118) project. We are developing IBP-1118 together with the
University of Florida. ROP can lead to blindness among premature babies. In addition, IBT has
signed a license agreement for a treatment against antibiotic-resistant bacteria including
hospital-acquired infections caused by vancomycin-resistant enterococci (VRE IBP-1122).
VRE infections have become a serious public health challenge linked to antibiotic resistance,
which in the United States annually results in 54,000 cases of VRE infections, leading to an
estimated 5,000 deaths among hospitalized patients and healthcare costs of $539 million.
In conclusion, I would like to take the opportunity to thank all colleagues who, with great
commitment, drive the work forward with a product that may play a major role for premature
babies in the near future.
Stockholm March 22, 2023
Staffan Strömberg
CEO
10!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
IBT’S PIPELINE
IBP-9414
IBP-9414 contains the active substance Lactobacillus reuteri, which is a co-evolved human
bacterial strain naturally present in breast milk. Lactobacillus reuteri is a live bacteria known to
be anti-inflammatory, anti-pathogenic and beneficial to gut motility. IBP-9414 is specifically
formulated with the consideration of the extremely sensitive target population of premature
infants.
IBT was granted Orphan Drug Designation by the FDA for Lactobacillus reuteri for the
prevention of NEC in premature infants in 2013 and by the European Commission in 2015. IBT
also received Rare Pediatric Disease Designation from the FDA for IBP-9414 in 2016.
In June 2016, IBT commenced a Safety and Tolerability study. At the end of 2017 the completed
study results demonstrated a similar safety and tolerability profile both in the active group and
placebo group.
IBT has, resulting from discussions with the FDA on November 20, 2018, chosen to modify its
Phase III study in premature infants for the prevention of necrotizing enterocolitis (NEC).
Following the guidance from the FDA, IBT amended the protocol to allow additional areas of
treatment such as reduced time to good digestion, called “Sustained Feeding Tolerance” (SFT).
The pivotal Phase III study, The Connection study, commenced in 2019 and the first patient was
recruited on July 4, 2019. A blinded evaluation presented in December 2021 showed that a
reduction of time to SFT correlates with fewer complications such as blood poisoning and
bronchopulmenary dysplasia, a chronic lungdisease affecting premature infants.
This means that "The Connection Study" has the opportunity to evaluate two primary endpoints
instead of one.
11!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
NEC
NEC is a leading cause of death among premature infants in neonatal intensive care units
(NICU). NEC annually kills approximately 3,700 and 1,500 infants in Europe and in the US,
respectively. NEC has an unpredictable, spontaneous, and acute onset and major surgery is
today the only available treatment. NEC is a serious inflammatory disease of the newborn bowel
in which portions of the bowel undergo tissue death (necrosis).
NEC primarily affects premature infants and the risk to contrive NEC increases the lower the
birth weight and lower gestational age. Gestational age is defined as the duration from the first
day of the last menstruation cycle until birth.
Occurrence of NEC by estimated gestational age is as set forth in Figure 1.
Figure 1. Occurrence of NEC by gestational age (Clark et al, 2012)
The disease has a higher rate of mortality in the younger and less mature infants. Mortality in
infants who had a diagnosis of NEC by estimated gestational age is as set forth in Figure 2.
12!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
Figure 2. Mortality in infants who had a diagnosis of NEC by estimated gestational age (Clark et al,
2012). The number listed outside parentheses in the table above is estimated gestational age in weeks.
The number listed within parentheses represents the number of patients with NEC within each
gestational age group.
The long-term clinical consequences for infants who survive NEC are variable and include short
bowel syndrome, parenteral nutrition-associated cholestasis, abnormal growth, and adverse
neurodevelopmental outcomes, including cerebral palsy, cognitive impairment, visual
impairment, and hearing impairment.
Sustained Feeding Tolerance
The first weeks of nutrition have important implications for the development of preterm infants.
The goal of achieving early and adequate enteral nutrition (tube feeding) in these infants is to
facilitate recovery or catch up growth, to achieve normal body composition, whilst minimizing
undesirable effects of nutritional imbalances (e.g. hyperglycemia, insulin resistance, etc.).
Evidence-based guidelines for nutrition of VLBW-infants (infants with a birthweight of under
1,500 grams) recommend supplementing nutrition (intravenous) within the first hours. When
nutrition cannot be given enterally, the children are given nutrition parenterally. However,
prolonged parenteral nutrition is associated with complications (intrahepatic cholestasis,
increased risk of bronchopulmonary dysplasia, worsening of pulmonary vascular resistance, IV
line-mediated infections and sepsis.
The enteral route of nutrition is the most physiological and natural way of administering nutrients
to the neonate. The introduction of enteral feeding is therefore recommended as soon as
possible, and ideally on day 1. This eliminates the need for parenteral nutrition and the
associated risks of complications. Establishing sustained enteral feeding, associated with the
discontinuation of parenteral nutrition is thus an important goal, especially in VLBW and ELBW-
infants (extremely low birth weight <1000g). Reducing the number of days to reach complete
enteral nutrition is considered to be clinically relevant and important in the treatment of the
preterm infant. A blinded evaluation of IBT’s Connection Study data published in the British
13!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
Journal of Gastroenterology in October 2022 shows that even a one day reduction in time to
SFT correlates to several clinically meaningful outcomes including a 7.65% reduction in
confirmed Necrotizing Colitis (NEC) events, 6.71% reduction in late onset sepsis, 2.75%
reduction in bronchopulmonary dysplasia (BPD) and a 5.85% reduction in days with antibiotic
use.
L. reuteri
Lactobacillus reuteri is a co-evolved human bacterial strain naturally present in breast milk. L.
reuteri is a live bacteria known to be anti-inflammatory, anti-pathogenic and beneficial to gut
motility.
Clinical Experience
Since 2012, thirteen published clinical trials that have enrolled more than 4,000 infants have
indicated proof-of-concept of the clinical potential of Lactobacillus reuteri in the prevention of
NEC.
Since 2012, nine published clinical studies that have enrolled more than 3,100 infants have
indicated proof-of-concept of the clinical potential of Lactobacillus reuteri for the reduction in
episodes of feeding intolerance or reduction in time to full enteral feeding.
The table below shows a summary of studies using Lactobacillus reuteri showing clear clinical
signal for the reduction in NEC incidence and clear clinical signal for reduction in episodes of
feeding intolerance or reduction in time to full enteral feeding.
14!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
Development Plan
The development plan for IBP-9414 consists of two clinical trials: the completed safety and
tolerability study followed by the ongoing pivotal Phase III study, The Connection Study. The
safety and tolerability study, was been completed on time in Q4 2017. The Connection Study
was initiated in the second half of 2019 and is ongoing.
The first study was a randomized, double blind, parallel-group, dose escalation placebo-
controlled multicenter study to investigate the safety and tolerability of IBP-9414 in premature
infants (ClinicalTrials.gov identifier: NTC02472769). The study included 120 premature infants,
defined as a gestational age ≤ 32 weeks and birth-weight ranging from 500 to 2,000 grams,
recruited and randomized to receive either IBP-9414 or placebo. The first dose of study drug was
administered within 48 hours of birth and continued daily for a period of 14 days. Follow-up
assessments were occasionally made up to six months after the last dose of the study drug. The
primary outcome in this trial was safety and tolerability. This Safety and Tolerability study has
been completed on time in Q4 2017. The safety and tolerability study concluded that IBP-9414
was safe and well-tolerated in premature infants with birth weights between 500–2,000 grams,
with high compliance to treatment with the study drug and that there was no evidence of cross-
contamination with IBP-9414 in placebo treated infants.
The ongoing pivotal Phase III study is designed to demonstrate and document efficacy of IBP-
9414 over placebo in two primary “endpoints”, prevention of NEC and improvement of so called
“Sustained Feeding Tolerance” in premature infants with a birth weight ≤ 1,500 grams. This study
will also include safety evaluation.
Given the urgency to provide an effective preventative therapy to this unmet medical need, IBT
plans to utilize the available FDA and EMA expedited programs to reach the market as soon as
possible.
15!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
Medical Need and market
There has been little or no progress in recent years in improving outcomes for infants that are
affected by NEC once the disease is underway. Nor is there definitive treatment that modifies the
underlying risk factors for the disease. Approximately 20 to 40 percent of patients with NEC will
require surgery. Thus, NEC prevention strategies are vital and urgently needed but to date none
have been successful or generally adopted as the standard of care. Subsequently, a preventive
treatment against NEC remains an unmet medical need.
NEC patients require medical care and in many cases also surgical interventions that increase
hospital expenditures and prolong length of stay. The economic burden of NEC has been
evaluated to be almost 20 percent of the total cost of the initial care of all newborns in the US,
and represents approximately USD 5 billion spent annually on NEC. Moreover, those infants who
survive NEC may face serious lifelong sequelae, which eventually decrease their quality of life
and generate further costs to the patient and society. In the light of this, a preventive therapy for
NEC would therefore be expected to both directly and indirectly reduce these healthcare
expenses. IBT intends to demonstrate these benefits to support reimbursement for IBP-9414 in
the prevention of NEC from caregivers, insurance companies and pharmaceutical authorities, in
order to gain compensation and reimbursement for IBP-9414 for prevention of NEC and SFT.
In 2021 an independent consultant company, ClearView Healthcare Partners LLC (“ClearView”),
was commissioned by IBT to evaluate the market need for the preventative drug IBP-9414 for
NEC (the “ClearView Report”). ClearView completed 30 interviews with neonatologists and
hospital Pharmacy and Therapeutics (“P&T”) committee members in the US.
The Clearview report established that neonatologists perceive NEC to represent a key priority
despite its low incidence. In addition, the need to improve digestion (SFT) in premature infants
is of decisive importance. The neonatologists nearly unanimously stated a need for improved
prevention of NEC and SFT to relieve both the clinical and economic burdens.
Clearview also reported an increasing interest by neonatologists to prescribe food supplements
to prevent NEC and SFT but that the majority of neonatologists do not recommend food
supplements to any great extent due to their opinion that FDA-regulation is key to guarantee
the required quality control. The ClearView Report estimated that the number of premature
16!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
infants eligible to receive prophylaxis for NEC and SFT is over 56,000 infants per annum in the
US.
A target product profile (“TPP”) was presented to interviewees in the interviews conducted by
Clearview. The TPP defined among other things the safety profile, method of administration,
and expected efficacy in the prevention of NEC of 33% and a statistically significant reduction
in time to SFT.
The ClearView Report has shown that when presented with the TPP of IBP-9414, neonatologists
reacted positively and expressed a strong willingness to use IBP-9414 in their clinical practice
(90 percent of Physician Preference Share), and according to a hospital template a majority of
P&T (Pharmacy and therapeutics) members expressed willingness to adopt the product. An
adapted price range was tested in the ClearView report, depending on gestation age. At a price
of USD 5,000 per week until the infant reaches 34 weeks as a baseline, ClearView estimates
sales amounting to USD 630m per annum in the USA. The analysis considered the number of
addressable patients, physician preference scores, formulary inclusion and protocol access.
With the results from the analysis for the USA with IBP-9414:s two primary endpoints, ClearView
made an assessment of what the corresponding results would be for the European market and
the rest of the world (ROW), illustrated as follows in the table below. This shows that the potential
for Europe corresponds to what we see for the USA, and ROW is estimated at approximately
half of the USA, resulting in a “megabrand” potential of USD 1.5bn.
Clearview market research assessment 2021.
17!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
Intellectual property
IBP-9414 is protected by already approved patents on Lactobacillus reuteri, held by BioGaia.
IBT has been granted from BioGaia an exclusive royalty-free license to use Lactobacillus reuteri
in IBT’s areas of interest. The license is valid for the duration of the patent term.
IBT has and intends to apply for patent protection for innovations for the purpose of securing a
sufficient and efficient protection of IBT’s current and future commercial position and interests.
Patent applications regularly cover the US, the EU, Japan and China, but also other markets
where it is commercially justified.
The patent protection granted in the US is valid until 2026 and in Europe, China and Japan until
2027. Thereafter patent term extensions are possible in certain areas of the world which could
provide additional patent protection of the innovation via patent term extensions.
IBT has filed for further patent protection for IBP-9414 which aims to protect patents until 2036.
On February 9 IBT announced that the Japan Patent Office has issued a decision to grant a
patent entitled: “A method of activating lactic acid bacteria”, which protects the formulation
of Lactobacillus reuteri including IBP-9414, and the same was also announced January 10th for
Australia. The Japanese patent is valid until 2036. The same was announced in 2021 from the
patent authorities of China, Mexico, Brazil and Hong Kong.
IBP-1016
Gastroschisis is a rare, life-threatening and debilitating birth abnormality in infants where the
infant is born with externalized intestines.
After the initial surgical repair, gastroschisis represents an area of significant unmet medical
need with no definitive treatment available. Post-operative management of gastroschisis is
largely aimed at overcoming the significant morbidity related to the reduction in gut motility and
consequent feeding intolerance necessitating the prolonged requirement for parenteral
nutrition. Infants suffering from gastroschisis have a greatly increased risk of sepsis and liver
cholestasis. It is common for neonates born with gastroschisis to have typically an extended
hospital stay of 1-5 months thereby causing significant burden to the healthcare system.
The active bacteria used in IBP-1016 is known to enhance gut motility and function in infants
with feeding intolerance.
IBP-1118
Retinopathy of prematurity (ROP) affects 50-70% of preterm infants weighing less than 1,500
grams at birth, which in several cases leads to blindness. Current treatments do not sufficiently
address the medical need as serious cases have increased significantly from 1,7 to 14,8 per
1,000 premature infants between 1990 and 2021.
IBT is at an early stage of investigating the possibilities of developing a drug to prevent ROP, a
growing and serious condition that often leads to blindness among prematurely born babies.
The FDA granted orphan drug designation for IBT’s product on Sep 20th, 2022.
18!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
The drug candidate, IBP-1118, is a dipeptide developed under the direction of Dr. Josef Neu,
professor at the University of Florida Health, Department of Pediatrics, Division of Neonatology,
and Dr. Maria Grant, professor at the University of Florida Health, Department of Endocrinology,
Diabetes, and Metabolism.
IBP-1122
Antibiotic resistance is rising to dangerous levels across the world. Hospital acquired
infections caused by vancomycin-resistant enterococci (VRE) have become a serious public
health challenge linked with the complexities of antibiotic resistance, resulting in 54,000 cases
and 5,000 deaths among hospitalized patients in the United States every year. VRE infections
are estimated to cause direct annual U.S. healthcare costs of $539M.
IBP-1122 is a bacterial strain engineered to eliminate VRE developed by Drs. Nita Salzman,
Chris Kristich, and Sushma Kommineni in the departments of Pediatrics and Microbiology &
Immunology at the Medical College of Wisconsin (MCW).
IBT has secured an exclusive global license from MCW for the platform consisting of
genetically modified bacteria. Leveraging MCW’s commitment to innovative patient care and
IBT’s expertise in developing pharma grade probiotics is a crucial step toward alleviating the
pressure placed on hospitals by vancomycin-resistant enterococci.
19!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
DIRECTORS REPORT
The Board of Directors and CEO of Infant Bacterial Therapeutics AB (publ) (”IBT”), reg. no.
556873-8586 hereby presents the Annual Report for the financial year January 1, 2020 to
December 31, 2021.
This financial report is prepared in accordance with RFR 2, Reporting for legal entities and
“Årsredovisningslagen”.
OPERATIONS
IBT is a clinical stage pharmaceutical company with a vision to develop drugs influencing the
infant microbiome, and thereby prevent or treat rare diseases affecting premature infants. IBT
is currently developing its drug candidate IBP-9414 to prevent necrotizing enterocolitis (NEC),
and improve so called “feeding tolerance” affecting premature infants. IBP-9414 contains the
active ingredient Lactobacillus reuteri, which is a human strain of bacteria found in breast milk.
The portfolio also contains a IBP-1016, for the treatment of gastroschisis, a rare and severe
disease in infants, IBP-1118 for the prevention of ROP (retinopathy of prematurity), a growing
and serious condition that can lead to blindness among prematurely born children, and IBP-
1122 to prevent antibiotic resistant hospital acquired infections. By developing these drugs, IBT
has the potential to fulfill medical needs where there are currently no treatment therapies
available.
The FDA and the European Commission have granted IBT Orphan Drug Designation, and the
FDA has granted “Rare Pediatric Disease” Designation for IBP-9414 for the prevention of NEC.
SIGNIFICANT EVENTS DURING 2022
● It was announced on January 10 that the patent office in Australia had issued an
approval for the patent: "A method of activating lactic acid bacteria".
● On January 19, IBT announced that The Connection Study continues after the Data
Monitoring Committee (DMC) had completed its pre-scheduled safety analysis
without any concerns. At the same time a futility analysis was performed. Based on
DMC recommendations and futility outcome, IBT is continuing the recruitment to the
study as planned.
● Maria Ekdahl assumed the role of CFO on September 19.
● On September 23, the FDA approved IBT’s request for a new orphan drug
designation forROP (retinopathy of prematurity).
● The British Journal of Gastroenterology published in October an article based on
IBT's “Connection Study” demonstrating that SFT is linked to serious disease
progression including sepsis and bronchopulmonary dysplasia.
20!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
SIGNIFICANT EVENTS AFTER THE FISCAL YEAR
● On January 12, 2023 IBT announced it secured a probiotic drug platform that can
prevent antibiotic-resistant hospital acquired infections.
● The British Journal of Gastroenterology published in January new results that
validate "Sustained Feeding Tolerance" (SFT) as a relevant primary endpoint in "The
Connection Study".
21!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
SELECTED FINANCIAL DATA
ooo's
2022
Jan-Dec
2021
Jan-Dec
Net sales
-
-
Other income
12
94
Operating profit/loss
-65 808
-44 578
Result after tax
-65 451
-44 991
Total assets
349 619
408 478
Cash flow for the period
-83 911
-55 532
Cash flow per share for the period (SEK)
-7.47
-4.95
Cash
335 840
386 752
Earnings per share before and after dilution (SEK)
-5.83
-4.01
Equity per share (SEK)
29.55
35.21
Equity ratio (%)
95%
97%
FINANCIAL DEVELOPMENT
Amounts are reported in KSEK (SEK in thousands). Amounts in parenthesis refer to the same
period in the previous year unless stated otherwise.
Result
Operational result amounted to KSEK -65,808 (-44,578) and result after financial items
amounted to KSEK -65,451 (-44,991).
Result after tax amounted to KSEK -65,451 (-44,991).
Result per share prior and after dilution amounted to SEK -5.83 (-4.01).
Costs
Costs for the ongoing IBP-9414 clinical trial are reported net of exchange rate effects on
foreign currency deposits. Exchange rate effects during the reporting period amounted to
KSEK 33,000 (18,846), (Note 1, 2).
Operational costs amounted to KSEK 98,819 (63,518) prior to exchange rate effects on foreign
currency deposits, and after exchange rate gains to KSEK 65,818 (44,672).
Costs for the ongoing IBP-9414 clinical trial amounted to KSEK 74,218 (42,196) prior to
exchange rate gains.
Personnel costs amounted to KSEK 18,933 (15,789).
Other external costs amounted to KSEK 5,668 (5,533).
Operational costs in total prior to exchange rate gains increased during the reporting period
compared to the previous year.
22!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
Costs for the ongoing clinical study increased regarding production of clinical trial material,
trial insurance coverage, patient recruitment and dosing in the ongoing phase III study which
was initiated in 2019.
Personnel costs are higher in the reporting period compared to the corresponding period last
year due to a bonus in connection with the introduction of a new share-based incentive
program. Bonus salaries amounted to approximately KSEK 4,600.
On a rolling twelve-month period, the company had 7 (8) full time equivalent employees. The
company had 8 (8) employees on the balance sheet date.
Other external costs are at the same level as the corresponding period last year.
Cash flow
Cash flow for the period amounted to KSEK -83,911 (-55,532). Cash flow per share amounted
to SEK-7.47 (-4.95).
Financial position
Prepaid expenses amounted to approximately KSEK 1,716 (9,140) and refers mainly to rents
and insurance.
Accrued expenses amounted to approximately KSEK 8,667 (7,648) and mainly refer to
research and development and personnel costs.
The Company’s cash balance on December 31, 2022, amounted to KSEK 335,840 compared
to KSEK 386,752 on December 31, 2021.
The Company’s shareholder’s equity on December 31, 2022, amounted to KSEK 331,705
compared to KSEK 395,254 on December 31, 2021. Shareholder’s equity per share on
December 31, 2022, amounted to SEK 29.55 compared to SEK 35.21 on December 31, 2021.
The Company’s equity ratio on December 31, 2022, amounted to 95% compared to 97% on
December 31, 2021.
IBT’s liquidity and capital is deemed sufficient to conduct the ongoing Phase III clinical study,
as well as to fund the company's activities until application for market approval.
Prospects for 2023
The development plan for IBP-9414 is comprised of a clinical program consisting of two
clinical trials: the completed safety and tolerability study and the ongoing pivotal Phase III
study, “The Connection Study”. The Safety and Tolerability Study was completed on schedule
during the fourth quarter of 2017. The following pivotal study, ”The Connection Study”,
commenced on July 4, 2019.
The primary goal in the first trial was to evaluate safety and tolerability. This study was
completed on time in Q4 2017 and concluded that IBP-9414 was safe and well-tolerated in
premature infants with birth weights between 500–2,000 grams, with high compliance to
treatment with the study drug and that there was no evidence of cross-contamination with
IBP-9414 in placebo treated infants.
23!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
The ongoing pivotal Phase III study is designed to demonstrate and document efficacy of IBP-
9414 over placebo in the prevention of NEC and the reduced time to Sustained Feeding
Tolearance in premature infants with a birth weight ≤ 1,500 grams. This study will also include
safety evaluation. A blinded analysis of IBT:s clinical phase lll-study in 2021 showed that
reduced time to SFT significantly reduces the risk of serious complications such as blood
poisoning. The validation of SFT as an endpoint was based on a procedure agreed with the
FDA. The validation conducted in 2021 means that the effect of IBP-9414 is documented for
two goals rather than one: to prevent NEC and also to reduce the time until SFT. Thus, the
study has two validated endpoints.
As a consequence of the COVID-19 pandemic the study is delayed and is as previously
communicated currently expected to be concluded in beginning of 2024.
RISKS AND UNCERTAINTIES
Risk management and control
The Company’s Board of Directors work continually and systematically with risk assessment
to identify risks and take the necessary actions to cope with them. The internal control
environment as described in the Company code of conduct report comprises mainly the
following components: control environment, risk assessment, control activities, information
and communication, as well as monitoring. For every identified significant risk, risk mitigation
actions are formulated.
Dependent on development of one product
The value of the Company is largely dependent on success in the Company’s development of
IBP-9414 and the successful completion of clinical trials and the grant of a marketing
authorization by the US Food and Drug Administration (“FDA”) and/or the European Medicines
Agency (“EMA”). IBT’s clinical development is at development stage and there is a risk that
IBP-9414 will not demonstrate the required effect. If the development on IBP-9414 is
unsuccessful, IBT may try to focus on other projects but there is a risk that such projects will
not be successful.
Patents and trademarks
BioGaia has a patent on Lactobacillus reuteri DSM 17938. BioGaia has granted IBT an
exclusive license to use Lactobacillus reuteri DSM 17938 for the development of a medical
treatment for premature infants. No royalties will be paid to BioGaia upon commercialization of
IBT's drug candidates.
The main patent protection for IBP-9414 is the product claim for the use of Lactobacillus
reuteri DSM 17938. This form of protection is often referred to as "full product protection",
similar to that used by the pharmaceutical industry for new chemical substances in the small
molecule product segment. Patents that include a product claim for the bacterial strain have
been issued in most major markets. The patent protection granted in the United States is valid
until June 2026 and in Europe, China and Japan until May 2027. Thereafter, the patent term
24!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
may be extended in certain areas of the world, which may give the innovation additional
patent protection.
● IBT has also applied for additional patent protection for IBP-9414 aimed at providing
extended protection for IBP-9414 until 2036.
● On February 12, 2021, the Japanese Patent Office issued the patent: "A method of
activating lactic acid bacteria", which covers formulations of IBP-9414. The Japanese
patent runs until 2036.
● On April 13, 2021, the Chinese Patent Office issued the patent: "A method of activating
lactic acid bacteria", which covers formulations of IBP-9414. The Chinese patent
extends to 2036 and IBP-9414 is intended to be marketed in China once market
approval is obtained.
● On September 7, 2021, the Mexican Patent Office issued the patent: "A method of
activating lactic acid bacteria", which covers formulations of Lactobacillus reuteri
including IBP-9414.
● On December 23, 2021, Australia issued the patent: "A method of activating lactic acid
bacteria", which covers formulations of Lactobacillus reuteri including IBP-9414.
● On February 1, 2022, the Brazilian Patent Office issued a patent for Lactobacillus
reuteri covering IBP-9414. The patent expires in 2036.
● On January 14, 2022, the Hong Kong Patent Office issued a patent covering
formulations of Lactobacillus reuteri DSM 17938. The patent runs until 2036.
In addition to its patent protection, IBP-9414 will also be protected as a biologic product and
be provided exclusivity as an orphan drug. Presently, the protection for orphan drugs and
biologics in the US is 7 and 12 years respectively from time of market approval. Similar
frameworks exist in Europe.
In the type of business conducted by IBT, there is always the risk that the company's licenses,
patents, trademarks or other intellectual property rights do not provide sufficient protection or
that the company's rights cannot be maintained. Furthermore, patents may be infringed, which
may lead to costly litigation. The outcome of such disputes cannot be guaranteed in advance.
Negative outcomes of intellectual property disputes may result in the losing party losing
protection, being prohibited from continuing to use the relevant right or being required to pay
damages.
Regulatory risk
IBT develops medicinal products and is dependent on assessments and decisions by applicable
authorities. Such assessments are preceded by decisions, among other, regarding permission
to conduct clinical studies, permission to market and sell pharmaceuticals, prerequisites for
prescribing pharmaceuticals, pricing of pharmaceuticals subject to reimbursement systems,
25!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
and discounts on pharmaceuticals. It cannot be guaranteed that IBT will obtain the authoritative
decisions necessary to conduct clinical studies and receive market approval.
It cannot be excluded that national authorities may take a contrary view or act to stop the
product being sold in the applicable country, which could lead to delays or withdrawal of market
approval.
To mitigate the regulatory risks IBT involves world-leading external expertise in relation to, for
example, regulatory matters or the design of clinical studies.
Production
IBT utilizes contract manufacturers for production of IBP-9414 which makes the Company
dependent on external deliveries meeting agreed requirements for example for quality, quantity
and time of delivery. There is no guarantee that IBT will not be impacted by delayed or failed
deliveries, which could impact the progress of the clinical studies. To minimize this risk, IBT
has evaluated a number of contract manufacturers that are able to produce IBP-9414.
Product liability and insurance
IBT conducts development of pharmaceutical products and conducts clinical studies which
causes risks related to product liability. To mitigate such risk, IBT carries insurance coverage
for products under development. There is however no guarantee that the insurance coverage
provides sufficient protection against claims for damages for eventual damages caused by the
company’s products or product candidates.
The Company’s insurance policies include coverage for patients who participate in clinical trials
and product liability insurance for products under development and in the market. The insurance
coverage is subject to continuous review. The Company deems that the Company’s insurance
coverage is appropriate for the current scope of the business.
Dependence on key persons
IBT is, to a high degree, dependent on a few key persons, both employees as well as directors.
The Company’s future earnings are affected by its ability to attract and retain qualified key
persons. In cases where one or more key persons leave the Company and the Company is not
successful in replacing such persons, this might have a negative effect on the Company’s
business, financial position and earnings.
Financial Risks
A predominant share of IBT’s development costs are commitments in foreign currencies. Should
the SEK depreciate versus the specific currency, it could have a significant impact on the
Company’s financial position and results. The currency against which IBT has the greatest
exposure is USD.
26!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
IBT’s balance sheet item “cash and cash equivalents” in the balance sheet represents cash
deposits at Danske Bank and SEB. The Company’s assessment is that the counterpart risk at
Danske Bank and SEB is very low. See note 18 for further information about financial risks.
The general macroeconomic situation regarding inflation and cost increases contributes to
some uncertainty and it cannot be excluded that IBT will be affected by this in the future. So far,
IBT has countered cost increases by purchasing USD and EUR in the past when the exchange
rate was more favorable.
Further information on risks and uncertainties is available in IBT’s Rights Issue Prospectus dated
January 10, 2018 on the Company’s homepage www.ibtherapeutics.com.
ENVIRONMENTAL RESPONSIBILITIES
The Company’s operations do not have any specific environmental risks and is not subject to
notification obligations under the Swedish Environmental Code. The Board of Directors of the
Company is of the opinion that the Company is in compliance with applicable rules and
regulations and offers its employees a sound and safe working environment.
SUSTAINABILITY
IBT should be perceived as an innovative and creative Company that represents quality, health
and provides a function in society. It is important for IBT to work actively with sustainability
issues. Respect for human rights, environment and anti-corruption shall reflect the company’s
operations with regard to business strategies, financing, investments and purchasing
processes. The Company is not legally required to publish a sustainability report.
LEGAL PROCEEDINGS
IBT is not and has never been involved in any legal proceedings.
CORPORATE GOVERNANCE
The company’s Corporate Governance Report for 2022 is included in this annual report and
published on the Company’s webpage www.ibtherapeutics.com
PUBLICATION
IBT strives to have good communication with the Company’s shareholders. The Company’s
publication of information should be correct, pertinent, and timely. The Company’s
communication will also be characterized by openness and the Company will publish periodic
interim reports and annual reports in Swedish and English. Events which are determined to
have potential impact on the share price will be distributed as press release.
CALENDAR
Interim report January – March 2023 May 8, 2023
Interim report January – June 2023 August 25, 2023
Interim report January – September 2023 November 10, 2023
27!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
ANNUAL GENERAL MEETING
The Annual General Meeting for IBT will be held on May 8, 2023 in Stockholm.
BOARD OF DIRECTORS RECOMMENDATION OF APPROPRIATION OF PROFITS
SEK
2022
Recommendation of appropriation of profits or loss
The Board of directors propose that the following surplus:
Income carried forward
-276 828 919
Surplus reserve
670 925 576
Result for the period
-65 450 864
Total
328 645 793
Be appropriated as follows:
Income carried forward
328 645 793
Total
328 645 793
Regarding results and financial position in general please refer to the following income
statements and balance sheets with accompanying notes.
28!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
INCOME STATEMENT
2022
Jan-Dec
2021
Jan-Dec
-
-
12
94
-65 820
-44 672
-65 808
-44 578
650
-
-293
-413
-65 451
-44 991
-65 451
-44 991
-5.83
-4.01
11 226 184
11 226 184
11 226 184
11 226 184
* No dilution effects exist
**On December 31, 2022, allocation of emitted shares amounted to 377,736 A-shares carrying 10 votes
per share and 10,848,448 B-shares carrying 1 vote per share
29!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
BALANCE SHEET
SEK 000
Note
2022-12-31
2021-12-31
ASSETS
Non-current assets
Intangible non-current assets
Activated development costs
6
10 518
11 334
Shares in subsidiary
7
70
50
Total non-current assets
10 588
11 384
Current assets
Current receivables
Accounts receivable
-
-
Other receivables
8
1 474
1 202
Prepaid expenses and accrued income 9
1 716
9 140
Total current assets
3 191
10 342
Cash and cash equivalents
10
335 840
386 752
Total current assets
339 031
397 094
TOTAL ASSETS
349 619
408 478
EQUITY AND LIABILITIES
Equity
Restricted equity
Share capital
3 060
3 060
Unrestricted equity
Share premium reserve
670 926
669 022
Accumulated losses
-276 829
-231 837
Net loss for the year
-65 451
-44 991
Total equity
331 705
395 254
Liabilities
Current liabilities
Accounts payable
8 746
4 797
Other current liabilities
500
779
Accrued expenses and prepaid income
11
8 667
7 648
Total current liabilities
17 913
13 224
TOTAL EQUITY AND LIABILITIES
349 619
408 478
30!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
STATEMENT OF CHANGES IN EQUITY
SEK 000
Restricted equity
Unrestricted equity
Share capital
Share premium
reserve
Accumulate
d losses incl.
loss for the
period
Total
equity
Opening equity on Jan 1,
2021
3 060
668 9317
-231 837
440 154
Net loss for the year
-44 991
-44 991
Total comprehensive income
-44 991
-44 991
Shareholder transactions
Warrants
91
91
Closing equity on Dec 31,
2021
3 060
669 022
-276 828
395 254
Opening equity on Jan 1,
2022
3 060
669 022
-276 828
395 254
Net income for the period
-65 451
-65 451
Total comprehensive income
-65 451
-65 451
Shareholder transactions
Warrants
1 904
1 904
Closing equity on Dec 31,
2022
3 060
670 926
-342 279
331 705
31!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
STATEMENT OF CASH FLOWS
SEK 000
2022
Jan-Dec
2021
Jan-Dec
Operating activities
Operating profit/loss
-65 808
-44 578
Interest income received
650
-
Paid interest costs
-293
-413
Adjustment for non - cash flow affecting items:
Depreciation production process
816
816
Value variance currency accounts
-33 000
-18 846
Cash flow from operating activities before changes in
working capital
-97 635
-63 021
Cash flow from changes in working capital
Increase (-)/Decrease (+) in operating receivables
7 151
4 338
Increase (+)/Decrease (-) in operating liabilities
4 689
3 060
Cash flow from operating activities
-85 795
-55 623
Financing activities
Sharholder contributions IBT Baby AB
-20
-
Warrants
1 904
91
Cash flow from financing activities
1 884
91
Cash flow for the period
-83 911
-55 532
Unrealized exchange rate difference in cash
33 000
18 846
Cash and cash equivalents at the beginning of the period
386 752
423 438
CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR
335 840
386 752
32!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
NOTES
Note 1 Accounting principles
This financial report is prepared in accordance with the Annual Accounts Act,
“Årsredovisningslagen” and as stipulated by RFR 2 Reporting for legal entities. Adoption of RFR
2 means that IBT applies all IFRS and statements as adopted by the EU to the extent possible
subject to the Annual Accounts Act, “Tryggandelagen” and considerations of the relation of
reporting and taxation. Preparation of financial reports in agreement with RFR 2 requires
application of some significant estimates regarding various evaluations and assessments of
principles of items for accounting purposes.
IBT has no transactions to report under total comprehensive income and a statement to that
effect is provided under the income statement.
The subsidiary, IBT Baby AB, was established in May 2017. During the second quarter of 2017
and third quarter of 2020 IBT Baby AB received warrants at no cost from the parent company,
which during the second quarter have been sold to personnel employed by IBT at market price.
Other transactions have not occurred. As the company was established with a share capital
amounting to 50 KSEK and only incurred marginal establishment costs, consolidated income
statement and balance sheet, in all material aspects, equal those of the parent company and
therefore no consolidation has been made, supported by the Annual Accounts act,
“Årsredovisningslagen 7 kap. 3a §”.
IFRS 16 'Leases'. The standard requires assets and liabilities related to all leases, with some
exceptions, to be recognized in the balance sheet. Early adoption is permitted. IBT only
prepares financial statements for legal entities and has thus chosen not to apply the rules in
IFRS 16. IBT instead applies paragraphs 2-12 of RFR 2 and thus lease payments continue to be
recognized as an expense on a straight-line basis over the lease term.
The changes that have entered into force and that apply from January 1, 2022 have not had any
significant impact on IBT's financial statements.
For financial years beginning on or after January 1, 2023, the amendment to IAS 1 on disclosure
of accounting policies is applied. By applying the amendments, an entity discloses its essential
accounting policies, rather than its significant accounting policies. Further amendments to IAS
1 are to explain how an entity can identify a significant accounting policy. To support the
amendments, the IASB has also developed guidance and examples to explain and identify a
significant accounting policy. Management believes that this amendment may impact
disclosures about accounting policies applied but has not yet fully evaluated these impacts.
Other amendments within IFRS/RFR 2 that are not yet effective are not expected to have a
material impact on IBT's financial statements.
Functional currency and reporting currency
IBTs functional currency is SEK. The financial statements are presented in SEK rounded to the
nearest thousand unless otherwise stated. Rounding to thousands may result in incorrect
amounts when summarized.
33!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
Recalculation from foreign currency
Transactions in foreign currencies are converted into the functional currency at the exchange
rates on the transaction date. Monetary assets and liabilities in foreign currencies are converted
into the functional currency at the exchange rates on the balance sheet date. Exchange rate
differences resulting from the conversion are reported in the financial items section in the
income statement. Non-monetary assets and liabilities are normally reported at historical cost
and converted to exchange rate at date of transaction.
Financial instruments, IFRS 9
Financial instruments are reported at cost. Financial assets are deleted from the balance sheet
when the right to receive cash flows from the instrument has ceased or been transferred and
the Company has transferred in principle all risks and benefits associated with possession.
Financial liabilities are deleted from the balance sheet when the liability in the agreement has
been fulfilled or otherwise revoked.
Classification and valuation
Financial assets are classifies based on the business model in which the asset is placed and
the cash flow character of the asset. If the financial asset is held within the framework of a
business model with the objective to collect contractual cash flows (hold to collect) and the
contractual terms relating to the financial asset at predetermined periods generates cash flows
solely comprised of capital and interest on the capital amount outstanding the asset will be
reported at accumulated cost.
If on the other hand the business model goal is met by both collecting contractual cash flows
and selling financial assets (hold to collect and sell), and the contractual terms of the financial
asset at determined periods generates cash flows solely comprised of payments of capital and
interest on the capital amount outstanding the asset will be reported at fair value under other
comprehensive income.
All other business models (other) where the purpose is speculation, carry for sale or where the
cash flow character eliminates other business models are consequently reported at fair value in
the income statement.
Financial assets are comprised of cash. Cash is comprised of immediately available cash held
by Swedish banks. The company applies the business model hold to collect regarding cash.
Financial liabilities are valued at fair value in the income statement provided they have a
determined price upon which IFRS 3 applies, carry for trade or if initially identified as liabilities
at fair value in the income statement. Other financial liabilities are valued at accumulated cost.
34!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
Write downs
The company reports loss reserves for expected credit losses on financial assets valued at
accumulated cost. On each balance sheet date the company reports changes in expected credit
losses since initial reporting in the result.
The company values the credit losses for all financial assets amounting to 12 months expected
losses. For financial assets with significant increase in risk since the initial reporting a reserve is
reported based on credit losses over the entire duration of the asset (the general model).
The company reports expected credit losses for the remaining duration of all financial
instruments with significant increase in risk since the initial reporting, either estimated
individually or collectively, considering all reasonable and verifiable information, including
forward looking. The company evaluates expected credit losses from financial instruments in
such manner that reflects objectively and by likelihood amounts ascertained by assessing an
interval of possible outcomes, discounted value of money and reasonable and verifiable
information regarding present conditions and forecasts regarding future economic conditions.
Cash is subject to the general model for write downs. The exemption for limited credit risk on
the balance sheet date applies to cash.
The company defines default as if it is deemed unlikely that the counterparty will meet its
obligations due to indications of financial difficulty and passed due payments. Default is
regardless deemed to be the case when payment is 90 days past due. The company will delete
a receivable when no further possible cash flows are deemed to exist.
Accounts payable
Accounts payable are commitments to pay for goods or services acquired in operations from
suppliers. Amounts are unhedged and normally payable within 30 days. Accounts payable are
classified as current liabilities when due within one year or sooner (or a normal cycle of operation
if longer). If not, they are reported as long-term debt. Liabilities are initially disclosed at Fair value
and thereafter at accrued cost applying the effective interest method.
Other liabilities
Expected duration for other liabilities is short, and therefore the liability is disclosed at nominal
amount without using the discounting method for accrued cost.
Accounts receivable and other receivables
Accounts receivable are reported at nominal value. Other receivables are reported at nominal
value. Fair value of accounts receivable and other receivables equals reported value as the
discounting effect is not material.
35!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
Non-current fixed assets
IBTs development of internally generated non-current fixed assets are separated in a research
phase and a development phase. All costs related to the research phase are reported as costs
as they are incurred. All costs related to development are reported as assets according to IAS
38 if all the following criteria are met:
● the technical and commercial feasibility of the product or process has been
established so it may be used or sold
● the Company intends and is able to complete the intangible asset and either use it or
sell it
● there are prevailing conditions to use or sell the intangible asset
● It should be probable that the future economic benefits attributable to the asset will
flow to the Company
● There are necessary and adequate technical, financial and other resources to complete
the development and to use or sell the intangible asset.
● The expenditure attributable to the intangible asset during its development can be
reliably estimated.
Costs related to the project are charged to income in the development phase should the above
criteria not be met.
IBT’s assessment is that development of the production process for the pharmaceutical
candidate IBP-9414 meets the above criteria. Costs generated by the project have been
activated as of the point in time the criteria were met. The production process has been
assessed as completed for accounting purposes. The intangible asset “production process” is
therefore depreciated over its estimated time of use and has caused depreciation costs in 2016.
Estimated useful life is 20 years. Depreciation is reported in the R&D function in the income
statement.
The currently ongoing development project, IBP-9414, is not deemed to meet the above criteria
in IAS 38 to be activated as development in the balance sheet. The development costs are
therefore charged to income as incurred.
Impairment of non-financial assets
Non-financial assets with uncertain periods of use or non-financial assets not ready for use, are
not depreciated but tested annually, or upon indication of impairment, for possible impairment.
Assets which are depreciated are evaluated regarding impairment any time events or changes
in circumstances indicate that the reported value may not be recovered. Write downs are made
by such amounts that reported value exceeds recoverable value. Recoverable value is the higher
of the assets Fair value reduced by sales costs and its useful value. Estimated impairment
requirements are grouped for assets at lowest possible levels where most significant
independent cash flow exists (cash generating groups). For assets (other than goodwill)
previously impaired a test is made at each balance sheet date if recovery should be made.
36!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
Liquid assets
Liquid assets in the balance sheet are comprised of cash and bank deposits.
Employee compensation
Employee compensation in the form of salaries, bonuses, paid vacation, paid sick leave, and
pension benefits are reported as earned. No pension commitments exist in the Company in
addition to pension premiums paid annually. All pension plans are fee based.
Cash flow statement
The cash flow is prepared according to the so called indirect method.
Income
Income is reported at Fair value received or to be received. The company had no income as of
the balance sheet date.
Leasing
Leasing where a significant part of risk and benefits with ownership are retained by the seller
are classified as operational leasing. Payments made during the term of lease are charged to
income in the income statement on a linear basis over the term of lease.
Segment reporting
Operational segments are reported in a method consistent with internal reporting provided to
the highest executive decision maker. The Board of Directors are the Company’s highest
executive decision maker. The Company’s operations are comprised of only one branch of
operation – to develop pharmaceutical products. The Company’s report of total comprehensive
income and financial position is solely one operating segment.
Taxes
The Company’s reported tax costs or tax income refers to current tax and changes in deferred
taxes. Current tax is calculated based on taxable income for the period in accordance with
prevailing tax laws. Current tax also includes adjustments from prior years.
IBTs taxable losses amount to approximately 371 (305) MSEK. Deferred taxes are reported for
all temporary differences generated between the taxable value of assets and liabilities and their
reported values. Deferred tax receivables are reported to the extent that it is likely that future
taxable profits will be available, against which temporary differences may be offset. Deferred
tax receivables in the company’s financial statements will be activated only when it is certain
37!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
that taxable income will occur. No deferred tax receivable is reported in the company’s financial
statements.
Significant assessments and estimates
Assessments and estimates are appraised continuously and are based on historical experience
and other factors, including expectations of future events considered to be reasonable under
current circumstances. The Company makes assessments and estimates regarding the future.
The resulting estimates for accounting purposes will, by definition, seldom equal the actual
results. Assessments are also made regarding the Company’s accounting principles.
The currently ongoing development project, IBP-9414, is not deemed to meet the above criteria
in IAS 38 to be activated as development in the balance sheet. The development costs are
therefore charged to income as incurred.
Amounts are reported in KSEK (SEK in thousands). Amounts in parenthesis refer to the same
period in the previous year unless stated otherwise.
Note 2 Financial instruments
Fair value of other receivables, cash, accounts payable and other liabilities are estimated to
equal book value (accumulated cost) due to the short duration.
The effects on earnings are reported in the income statement against research and development
costs.
Note 3 Leasing
IBT carries no financial leasing agreements. Leasing costs related to operational leasing are
charged at cost over the leasing period. No non-terminable leases exist after a duration of five
years.
Total future leasing costs regarding leasing agreements on the balance sheet date are as
follows:
38!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
Operational leasing
2022-12-31
2021-12-31
000's
Due for payment within one year
971
986
Due for payment within one and five years
876
1 763
Total
1 847
2 749
Operational leasing costs during the year
2022
2021
000's
Rent
666
816
Parking
51
62
Automobiles
300
237
Total
1 017
1 115
Note 4 Personnel
Average number of employees
Average number of employees
2022
2021
Female
Male
Total
Female
Male
Total
Sweden
3
4
7
3
5
8
Total
3
4
7
3
5
8
2022 Actual
on Dec, 31
2021
Actual on
Dec, 31
Female
Male
Total
Female
Male
Total
Board of
Directors
3
2
5
3
3
6
Other
management
1
4*
5
0
4
4
Total
4
6
10
3
7
10
*One other management does not receive salary but invoices fees
39!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
Total salaries, pension- and social costs, 000's
2022
2021
Salaries and other compensation
13 643
11 491
Invoice fees other
management
2 304
-
Pensions
1 509
1 720
Social costs
2 280
2 201
Other costs
409
283
Total
20 145
15 695
Variable compensation to management amounted to SEK 3 810 (953) k.
Board of Directors and committees
Fees are paid in accordance with the decision taken at the annual general meeting.
Chief executive officer
Base salary for the CEO, Mr. Staffan Strömberg, during 2022 amounted to SEK 2 815k plus SEK
2 402k in variable compensation.
The CEO has fee based pension compensation and the company has therefore no other pension
commitments other than stated here. Pension premiums in 2022 amounted to SEK 894k.
The CEO and the company have a mutual notice period of six months. In addition, the company
has a commitment of severance pay equal to nine months salary upon termination by the
company.
Other management
Compensation to other management is comprised of base salary, performance compensation,
other compensation and pension premiums. Other management in the company refers to four
persons who along with the CEO comprise the management group (Note 7).
The management group was in 2022 comprised of CEO Mr. Staffan Strömberg, COO Mr. Anders
Kronström, CSO, CMO Mr. Jonas Rastad and CFO, Mr. Michael Owens until June, CFO Mrs
Maria Ekdahl from September, CCO Mr Robert Molander from May.
40!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
Management compensation 2022
000's
Base
salaries/
fees
Variable
compensation
Other
benefits
Pension
costs
Total
Peter Rothschild, Chairman of the Board
670*
-
-
-
670
Margareta Hagman, Board member
138**
-
-
-
138
Eva Idén, Board member
138
-
-
-
138
Anthon Jahreskog, Board member
178
-
-
-
178
Robert Molander, Board member
63
-
-
-
63
Kristina Sjöblom Nygren, Board member
138
-
-
-
138
Staffan Strömberg, CEO
2 815
2 402
173
894
6 285
Other management (4)
5 235
1 408
80
435
7 661
Total
9 373
3 810
253
1 329
14 765
*Of which 400k as working Chairman, of wich 25k is paid out 2023
** Of which 63k is paid out 2023
In order to meet IBT's long-term interests and ensure that the CEO has a market-based and
competitive remuneration package, the Board of Directors has decided to deviate from the
guidelines for remuneration to senior executives regarding variable remuneration for 2022. The
variable remuneration for the CEO for 2022 mainly consists of long-term share-based
remuneration
41!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
The management group was in 2021 comprised of CEO Mr. Staffan Strömberg, COO
Mr. Anders Kronström, CMO Mr. Jonas Rastad and CFO, Mr. Michael Owens.
Management compensation
2021
Base
salaries/fee
s
Performance
compensation
Other
benefits
Pension
costs
Total
000's
Peter Rothschild, Chairman of the
Board
670*
-
-
-
670
Margareta Hagman, Board
member
125
-
-
-
125
Anthon Jahreskog, Board member
165
-
-
-
165
Eva Idén, Board member
125
-
-
-
125
Robert Molander, Board member
125
-
-
-
125
Kristina Sjöblom Nygren, Board
member
125
-
-
-
125
Staffan Strömberg, CEO
2 739
878
166
823
4 606
Other management (3)
3 415
75
35
672
4 197
Total
7 489
953
202
1 495
10 139
*Of which 400k as working Chairman
42!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
Note 5 Audit fees
Deloitte AB, 000's
2022
2021
Auditing
270
353
Totalt
270
353
Auditing refers to compensation for review of the company’s internal controls, accounting,
annual report and administration by the Board of Directors and CEO.
Note 6 Intangible non-current assets
Activated development costs, 000's
2022
2021
Opening accumulated costs
16 225
16 225
Activated costs
-
-
Total cost
16 225
16 225
Opening accumulated depreciation
-4 891
-4 075
Depreciation
-816
-816
Total accumulated depreciation
-5 707
-4 891
Carrying amount at end of the period
10 518
11 334
Activated development costs refer to the production process of the pharmaceutical candidate
IBP-9414. Period of use is based on the underlying useful life of the patent of 20 years.
Depreciation is linear from 2016 and is reported in the R&D-function in the income statement
Impairment test
The criteria according to IAS 38 and IAS 36, respectively, require testing the immaterial fixed
assets for impairment whenever events or changed circumstances indicate that the reported
value may not be recovered.
Activated costs referring to the production process have been assessed. The company has at
the time of disclosure of this financial report utilized the pharmaceutical candidate produced by
the production process in a clinical Phase II study in which 120 patients were dosed.
Technology transfer possibility of the manufacturing method has been verified by third parties.
The production process will be applied in the production of the drug upon potential market
approval.
Two independent companies, Apex Healthcare Consulting Ltd., and Clearview Healthcare
Partners have evaluated the market potential in 2014 and 2016, respectively, for IBP-9414 in
the USA.
Their assessment of the market potential amounted to an interval of 200 MUSD to 360 MUSD
per annum.
43!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
The total assessment is that the criteria in IAS 38 are met.
Note 7 Shares in subsidiary
Name
Reg. No.
Domicile,
country
No.
Shares
Ownership
Book value
2022
Book value
2021
IBT Baby AB
559110-7353
Stockholm,
Sweden
50 000
100%
70 000
50 000
Total, SEK
50 000
50 000
IBT Baby AB manages incentive programs for key personnel employed by IBT AB.
IBT issues warrants which are sold by IBT Baby AB to employees of IBT AB eligible to participate
in the parent company’s incentive program as follows:
Share based incentive programs
WARRANTS 2020/2024
On June 16, 2020, the Annual General Meeting decided on an incentive program by designated
issue of warrants to the subsidiary IBT Baby AB. The maximum number of warrants to be issued
are 375 000.
In September 2020, 185 027 warrants were allotted at market terms at a price determined by
calculating market price at the time of issue using the Black & Scholes method of valuation.
During the first quarter of 2021, 49 046 warrants were allotted. Total market price for the allotted
49 046 warrants during the first quarter of 2021 amounted to 88 KSEK.
During the third quarter of 2021, 10 000 warrants were allotted. Total market price for the allotted
10 000 warrants during the third quarter of 2021 amounted to 3 KSEK.
The holder of warrants may during the period from July 1, 2024 through September 20, 2024,
for each warrant subscribe for one point one (1) new class B share in the company at a
subscription price per share amounting to SEK 400. On the balance sheet date December 31,
2021, a total of 244 073 (185 027) warrants had been allotted. The remaining 130 927 warrants
are reserved for future employees.
The warrants are subject to first right of refusal stipulating that the warrants shall be sold back
to IBT Baby AB should the employee, from the date of signing, terminate employment within
one year by 100%, within two years by 75%, within three years by 50%.
The warrants carry no dividend rights. The warrants are issued at market value and have thus
have not resulted in any benefits which require accruals for social costs in the parent company.
The subscription price per share exceeds the market price of IBT’s share on the balance sheet
date which means that the warrants do not cause any dilution when calculating result per share.
44!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
Based on the existing number of shares the dilution resulting from the adopted incentive
program, provided that all warrants are utilized for subscription of class B-shares, amounts to
approximately 2.13 percent of shares, and 1.69 percent of votes.
Ownership of warrants
2020/2024
Number allotted
2022-12-31
Number issued
2022-12-31
Number allotted
2021-12-31
Number issued
2021-12-31
Staffan Strömberg, CEO
50 000
50 000
50 000
50 000
Anders Kronström, COO
40 000
40 000
40 000
40 000
Other
154 073
154 073
154 073
154 073
Total
244 073
244 073
244 073
244 073
WARRANTS 2022/2025
The Annual General Meeting on May 4, 2022 decided to introduce an incentive program,
Warrants 2022/2025 through a directed issue of warrants to the subsidiary IBT Baby AB. The
number of warrants amounts to a maximum of 304,500.
During the month of June 2022, 272,000 warrants have been transferred on market terms at a
price determined based on a calculated market value at the time of the transfer using the
Black & Scholes valuation model.
During the period from June 1, 2025 up to and including September 30, 2025, warrant holders
are entitled to subscribe for one (1) new Class B share in the company at a subscription price
per share corresponding to SEK 129.56. As of December 31, 2022, 272,000 warrants had
been issued. The remaining 32,500 warrants have not been allocated.
The warrants are subject to pre-emption, which stipulates that the warrants shall be sold back
to IBT Baby AB if the employee from the subscription date terminates his/her employment
within one year with 100%, within two years with 75%, and within three years with 50%. After
three years, the holder is entitled to keep the warrants.
Based on the existing number of shares in the company, the dilution as a result of the
implemented incentive program, assuming that all warrants are exercised for new subscription
of B shares, is approximately 2.37 percent of the shares and approximately 1.83 percent of
the votes.
The warrants carry no right to dividends. The options have been issued at market value and
have therefore not entailed any benefit that gives rise to a provision for social security
contributions in the parent company.
The subscription price per share exceeds the market price of the IBT share on the balance
sheet date, so the options do not entail any dilution when calculating earnings per share.
The total market price for 272,000 warrants issued during the second quarter of 2022
amounted to SEK 1,904 thousand, which was recognized directly against equity in IBT.
45!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
Ownership of warrants
2022/2025
Number allotted
2022-12-31
Number issued
2022-12-31
Number allotted
2021-12-31
Number issued
2021-12-31
Staffan Strömberg, CEO
120 000
120 000
0
0
Anders Kronström, COO
75 000
75 000
0
0
Robert Molander, CCO
20 000
20 000
Other
57 000
57 000
0
0
Total
272 000
272 0003
0
0
Total number of allotted warrants in existing incentive programs
Allotted
warrants, year
Issued
warrants
Strike
price*
Value per
allotted
warrant
Volatility,
%*
Risk-free
interest, %
Value
per
share
Expiry,
year
2020 (2020/2024)
87 543
400
14.24
40
-0,3
170
2024
2020 (2020/2024)
97 484
400
4.86
40
-0,3
125
2024
2021 (2020/2024)
49 096
400
1.78
40
-0,3
105
2024
2021 (2020/2024)
10 000
400
0.29
40
-0,3
81
2024
2022 (2022/2025)
272 000
129,56
7
40
1,32
66,90
2025
Total
516 073
-
-
-
-
-
-
*Expected future volatility is ascertained by comparison of historical average and median values for
comparable listed companies in the same sector as IBT based on analysis in S&P Capital IQ.
Note 8 Other receivables
000's
2022
2021
Taxes
1 179
831
Other receivables
295
371
Total cost
1 474
1 202
46!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
Note 9 Prepaid expenses and accrued income
000's
2022
2021
Accrued interest income
304
-
Prepaid rent
185
165
Prepaid insurance
612
294
Prepaid CRO costs
610
8 599
Other prepaid expenses
6
82
Total cost
1 716
9 140
The maximum credit risk exposure on the balance sheet date equals reported value.
Note 10 Cash and bank deposits
000's
2022
2021
Bank deposits at Danske Bank and SEB
335 840
386 752
Total cost
335 840
386 752
The Company’s liquidity consists solely of cash deposits held at Danske Bank and SEB. Total
liquidity on the balance sheet date December 31, 2022, amounted to SEK 335.8 (386.8m) of
which USD amounted to SEK 180.9m (200.4m) and EUR amounted to SEK 35.8m (45.2m).
Note 11 Accrued expenses and prepaid income
000's
2022
2021
R&D costs
6 159
4 700
Social costs and special salary taxes
709
1 153
Vacation pay
1 473
1 427
Salaries
-1
81
Board fees
63
78
Other accrued expenses
263
209
Total
8 667
7 648
All accrued expenses are due for payment within twelve months.
Note 12 Significant events after the reporting period
● On January 12, IBT announced it secured a probiotic drug plattform that can prevent
antibiotic-resistant hospital acquired infections.
● The British Journal of Gastroenterology published in January new results that validate
“Sustained Feeding Tolerance” (SFT) as a relevant primary endpoint in “The
Connection Study”.
47!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
Note 13 Board of Directors recommendation of appropriation of profits
SEK
2022
Recommendation of appropriation of profits or loss
The Board of directors propose that the following surplus:
Income carried forward
-276 828 919
Surplus reserve
670 925 576
Result for the period
-65 450 864
Total
328 645 793
Be appropriated as follows:
Income carried forward
328 645 793
Total
392 645 793
Note 14 Related party transactions
Compensations to the Board of directors are paid in accordance with the annual general
meeting.
The Chairman of the Board, Mr. Peter Rothschild, receives Board fees amounting to KSEK 300
per annum, and KSEK 400 annually as operational Chairman.
Bonuses were paid during the second quarter to Staffan Strömberg amounting to KSEK 1 953
and to Anders Kronström KSEK 1 221, and to Robert Molander KSEK 187.
Bonus was paid during the fourth quarter to Staffan Strömberg amounting to KSEK 449 as
variable bonus as a percentage of gross salary.
Mr. Robert Molander invoiced consulting fees January to April amounting to KSEK 832, mainly
relating to commercialization of IBP-9414. From May Mr. Robert Molander invoiced KSEK 1
472 for his position as CCO at IBT. During 2022 Mrs Eva Idén invoiced KSEK 15, consultancy
fees related to assistance with various policies.
KSEK 1 904 has been transferred from IBT Baby to IBT AB:s equity for warrants. IBT AB has
made a shareholder contribution to IBT Baby of KSEK 20.
No other significant related party transactions have occurred.
Note 15 Pledged assets and contingent liabilities
2021
2020
Pledged assets and contingent liabilities
None
None
48!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
Note 16 Result per share
Calculations are in accordance with IAS 33 Earnings per share. Earnings per share are
calculated by dividing result for the period with the weighted average number of outstanding
shares during the period.
Result per share, SEK
2022
2022
Result for the period, 000's
-65 451
-44 991
Weighted average number of shares before and after dilution*
11 226 184
11 226 184
Result per share before and after dilution
-5.83
-4.01
Note 17 Share capital development (SEK)
Period
Transaction
Change
Series A
shares
Series B
shares
Share
capital
Quota
value
Subscription
price
Total
Invested
2011-11-22
Founding
50 000
50 000
1,00
1,00
50 000
2015-09-15
Share issue
40 000
90 000
1,00
1 320,00
52 800 000
2015-09-15
Bonus issue
90 000
500 000
5,56
-
52 850 000
2016-02-12
Split/reclass
-90 000
74 066
1 760 480
500 000
0,27
-
52 850 000
2016-05-30
Share issue
-
148 132
3 520 960
1 500 000
0,27
27,30
153 016 212
2017-11-30
Share issue
-
-
1 100 000
1 799 802
0,27
95,00
257 516 212
2018-02-05
Share issue
-
155 538
4 435 663
3 051 120
0,27
95
693 680 307
2018-02-13
Share issue
-
-
31 345
3 059 663
0,27
95
696 658 082
Totalt
0
377 736
10 848 448
3 059 663
0,27
-
696 658 082
Note 18 Financial risk management
General
The financial risks related to the Company’s operations are mainly liquidity, currency, and
counterparty risks.
Liquidity risks
Liquidity risks are such risks as not having access to liquidity to meets the Company’s
operational requirements. The Company has no financial liabilities with agreed duration. Other
liabilities are commitments to pay for goods or services obtained during operations from
suppliers. The amounts are unhedged and normally payable within 30 days. Capital needs are
monitored by budget review.
49!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
Financing strategy
The Company’s capital requirements have previously been met by capital injections from its
former parent company, BioGaia and share issue in connection with listing the Company on
Nasdaq First North in March 2016. To date, IBT has received 82 MSEK from BioGaia and 100
MSEK from other shareholders in connection with the May 2016 share issue.
IBT has during November 2017 generated SEK 104.5m in a directed share issue to institutional
investors and in January 2018, a preferred share issue generated SEK 439.1m. Capital
generated amounting to approximately SEK 543.6m prior to transaction costs and
approximately SEK 528m post transaction costs is deemed sufficient to conduct the planned
pivotal Phase III clinical study.
As the Company’s pharmaceutical candidate IBP-9414 reaches important milestones in its
pharmaceutical development, additional financing possibilities are available. As a listed
company in Sweden the Company can issue new shares with preemptive rights for its
shareholders. Other possible financing methods are licensing specific rights to the
pharmaceutical to pharmaceutical company partners and a share issue to new investors,
conditional upon being possible on terms acceptable to current shareholders.
Obtaining loans for financing is not deemed suitable other than as a temporary solution before
the Company reaches profitability and has positive cash flow. The company has only financial
liabilities with short duration which are due for payment within 12 months.
Access to capital may be limited at times when needed by the Company.
Counterparty risks
Only investments in instruments with low credit risk and high liquidity are allowed. The company
works with established and creditworthy counterparties and continuously evaluates receivables
to ensure a low exposure to bad debts. To reduce this risk, IBT places its excess liquidity in
accounts with Danske Bank and SEB. On the balance sheet date, the company had
approximately SEK 255 million invested in 3 (SEK 96 million) and 6 (SEK 159 million) month fixed
rate accounts.
Currency risk is the risk that the value of assets and liabilities will vary due to changes in
exchange rates. The majority of IBT's development costs consist of commitments in other
currencies. If the SEK decreases in value against the currency in question, it can have a
significant impact on the company's position and results. The currencies to which IBT has the
greatest exposure are USD and EUR.
50!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
FINANCIAL DEFINITIONS
Key ratios
Definition
Motive
Average number
of shares
Average number of shares during the
year
Relevant in calculating income and
cash flow per share
Net sales
Sales for the year
Sales of services
Reporting period
January 1 - December 31, 2022
Defines time period comprised by
this financial report
Result per share
Result for the year divided by average
number of shares
Result allocated per share
Cash flow per
share*
Cash flow for the year divided by
average number of shares
Measure to describe cash flow
allocated to one share during the
year
Number of
shares*
Number of shares at the end of the
year
Relevant for calculating
shareholders’ equity allocated to
one share
Shareholders
equity/share*
Total shareholders’ equity divided by
the number of shares at the end of the
year
Measure to describe shareholder’s
equity per share
Equity ratio*
Total shareholders’ equity as a
percentage of total assets
Measure to evaluate the company’s
ability to meet its financial
obligations
*The Company presents certain financial measures in the Year-end report not defined by IFRS. The
Company deems that these measures provide valuable additional information for investors and
management of the Company as they enable evaluation and benchmarking of the Company’s
performance. As all companies do not calculate financial measures the same way, these measures are
not always comparable to those used by other companies. These financial measures shall therefore not
be viewed as replacements for those defined by IFRS. The financial definitions are not defined by IFRS
unless otherwise stated.
51!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
BOARD’S ASSURANCE
The Board of Directors and CEO hereby certify that this report gives a true and fair
presentation of the Company’s operations, financial position and result of operations, and
describes material risks and uncertainties facing the Company.
The Annual Report was approved for issuance by the Board of Directors on March 22, 2023
and will be subject to approval at the annual general meeting on May 8, 2023.
Stockholm, March 2, 2023
Peter Rothschild
Chairman
Eva Idén
Director
Margareta Hagman
Director
Kristina Sjöblom Nygren
Director
Anthon Jahreskog
Director
Staffan Strömberg
CEO
Nb: This is a translation of the Swedish annual report. If any discrepancies exist, the Swedish
version shall prevail.
Our Auditor’s Report was submitted on March 22, 2023
Deloitte AB
Jenny Holmgren
Authorized public accountant
52!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
Auditor’s report
To the general meeting of the shareholders of Infant Bacterial Therapeutics AB
(publ)
corporate identity number 556873-8586
Report on the annual accounts
Opinions
We have audited the annual accounts of Infant Bacterial Therapeutics AB (publ) for the
financial year 2022-01-01 - 2022-12-31. The annual accounts of the company are
included on pages 23-53 in this document.
In our opinion, the annual accounts have been prepared in accordance with the Annual
Accounts Act and present fairly, in all material respects, the financial position of Infant
Bacterial Therapeutics AB (publ) as of 31 December 2022 and its financial performance
and cash flow for the year then ended in accordance with the Annual Accounts Act. The
statutory administration report is consistent with the other parts of the annual accounts.
We therefore recommend that the general meeting of shareholders adopts the income
statement and balance sheet.
Basis for Opinions
We conducted our audit in accordance with International Standards on Auditing (ISA)
and generally accepted auditing standards in Sweden. Our responsibilities under those
standards are further described in the Auditor’s Responsibilities section. We are
independent of Infant Bacterial Therapeutics AB (publ) in accordance with professional
ethics for accountants in Sweden and have otherwise fulfilled our ethical responsibilities
in accordance with these requirements.
We believe that the audit evidence we have obtained is sufficient and appropriate to
provide a basis for our opinions.
Key Audit Matters
Key audit matters of the audit are those matters that, in our professional judgment, were
of most significance in our audit of the annual accounts of the current period. These
matters were addressed in the context of our audit of, and in forming our opinion
thereon, the annual accounts and as a whole, but we do not provide a separate opinion
on these matters.
Research and development costs
The company’s costs for research and development as of December 31, 2022 amount to
TSEK 65 820 after exchange rate gains on foreign currency forward contracts and
53!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
currency deposits and is a significant amount in the income statement. It is
management’s assessment that the entire amount should be expensed instead of being
capitalized as intangible assets since the criteria in IAS 38 regarding capitalization are
not deemed to be fulfilled. The company describes its positions in the accounting
principles on page 36. Our audit procedures included, but were not limited to:
! Examination of a number of transactions to ensure correct classification
! Examination of the company’s analysis and assumptions that form the basis of the
company's position for the question
! Examination that the required disclosures are provided in the annual accounts
Other information than the annual accounts
This document also contains other information than the annual accounts and is found on
pages 1-22. The Board of Directors and the Managing Director are responsible for this
other information.
Our opinion on the annual accounts does not cover this other information and we do not
express any form of assurance conclusion regarding this other information.
In connection with our audit of the annual accounts and, our responsibility is to read the
information identified above and consider whether the information is materially
inconsistent with the annual accounts. In this procedure we also take into account our
knowledge otherwise obtained in the audit and assess whether the information otherwise
appears to be materially misstated.
If we, based on the work performed concerning this information, conclude that there is a
material misstatement of this other information, we are required to report that fact. We
have nothing to report in this regard
Responsibilities of the Board of Directors and the Managing Director
The Board of Directors and the Managing Director are responsible for the preparation of
the annual accounts and that they give a fair presentation in accordance with the Annual
Accounts Act. The Board of Directors and the Managing Director are also responsible for
such internal control as they determine is necessary to enable the preparation of annual
accounts that are free from material misstatement, whether due to fraud or error.
In preparing the annual accounts, The Board of Directors and the Managing Director are
responsible for the assessment of the company’s ability to continue as a going concern.
They disclose, as applicable, matters related to going concern and using the going
concern basis of accounting. The going concern basis of accounting is however not
applied if the Board of Directors and the Managing Director intends to liquidate the
company, to cease operations, or has no realistic alternative but to do so.
Auditor’s responsibility
Our objectives are to obtain reasonable assurance about whether the annual accounts
54!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
as a whole are free from material misstatement, whether due to fraud or error, and to
issue an auditor’s report that includes our opinions. Reasonable assurance is a high level
of assurance, but is not a guarantee that an audit conducted in accordance with ISAs
and generally accepted auditing standards in Sweden will always detect a material
misstatement when it exists. Misstatements can arise from fraud or error and are
considered material if, individually or in the aggregate, they could reasonably be
expected to influence the economic decisions of users taken on the basis of these
annual accounts.
A further description of our responsibilities for the audit of the management’s
administration is located at the Swedish Inspectorate of Auditors website:
www.revisorsinspektionen.se/revisornsansvar
http://www.revisorsinspektionen.se/ri/showdocument/documents/This description forms
part of the auditor´s report.
Opinions
In addition to our audit of the annual accounts, we have also audited the administration
of the Board of Directors and the Managing Director of Infant Bacterial Therapeutics AB
(publ) for the financial year 2022-01-01 - 2022-12-31 and the proposed appropriations of
the company’s profit or loss.
We recommend to the general meeting of shareholders that the profit to be appropriated
in accordance with the proposal in the statutory administration report and that the
members of the Board of Directors and the Managing Director be discharged from
liability for the financial year.
Basis for Opinions
We conducted the audit in accordance with generally accepted auditing standards in
Sweden. Our responsibilities under those standards are further described in the Auditor’s
Responsibilities section. We are independent of Infant Bacterial Therapeutics AB (publ) in
accordance with professional ethics for accountants in Sweden and have otherwise
fulfilled our ethical responsibilities in accordance with these requirements.
We believe that the audit evidence we have obtained is sufficient and appropriate to
provide a basis for our opinions.
Responsibilities of the Board of Directors and the Managing Director
The Board of Directors is responsible for the proposal for appropriations of the
company’s profit or loss. At the proposal of a dividend, this includes an assessment of
whether the dividend is justifiable considering the requirements which the company's
type of operations, size and risks place on the size of the company's equity,
consolidation requirements, liquidity and position in general.
The Board of Directors is responsible for the company’s organization and the
administration of the company’s affairs. This includes among other things continuous
assessment of the company’s financial situation and ensuring that the company's
55!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
organization is designed so that the accounting, management of assets and the
company’s financial affairs otherwise are controlled in a reassuring manner. The
Managing Director shall manage the ongoing administration according to the Board of
Directors’ guidelines and instructions and among other matters take measures that are
necessary to fulfill the company’s accounting in accordance with law and handle the
management of assets in a reassuring manner.
Auditor’s responsibility
Our objective concerning the audit of the administration, and thereby our opinion about
discharge from liability, is to obtain audit evidence to assess with a reasonable degree of
assurance whether any member of the Board of Directors or the Managing Director in
any material respect:
! has undertaken any action or been guilty of any omission which can give rise to
liability to the company, or
! in any other way has acted in contravention of the Companies Act, the Annual
Accounts Act or the Articles of Association.
Our objective concerning the audit of the proposed appropriations of the company’s
profit or loss, and thereby our opinion about this, is to assess with reasonable degree of
assurance whether the proposal is in accordance with the Companies Act.
A further description of our responsibilities for the audit of the management’s
administration is located at the Swedish Inspectorate of Auditors website:
www.revisorsinspektionen.se/revisornsansvar
http://www.revisorsinspektionen.se/ri/showdocument/documents/This description forms
part of the auditor´s report.
Deloitte AB, was appointed auditor of Infant Bacterial Therapeutics AB (publ) by the
general meeting of the shareholders on the 2022-05-04 and has been the company’s
auditor since 2015-03-29.
Stockholm March 22, 2022
Deloitte AB
Jenny Holmgren
Authorized public accountant
56!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
CORPORATE GOVERNANCE REPORT IBT
IBT is a Swedish limited company whose B shares are listed on Nasdaq Stockholm. The
company is governed by the AGM, the Board of Directors, the President and the executive
management in accordance with the Companies Act, the Articles of Association, rules of
procedure for the Board and the CEO's instructions and the Swedish Code of Corporate
Governance. The Board is responsible for evaluating established goals and continuously
evaluating IBT's financial position and earnings and evaluating the operational management.
The share capital consists of 377,736 Class A shares with 10 voting rights per share and
10,848,448 Class B shares with one voting right per share.
Compliance with the Swedish Code of Corporate Governance (Svensk Kod för
Bolagsstyrning), common stock market code and applicable stock market rules
The purpose of the Code is to strengthen confidence in Swedish listed companies by promoting
a positive development of the company's corporate governance. The code is based on the
principle of "comply or explain" which means that a company can make deviations from the
code but these must then be explained.
IBT has not deviated from any of the rules specified in the Code.
IBT has not been subject to a decision by Nasdaq Stockholm's disciplinary committee or a
statement by the Swedish Securities Council (Arbetsmarknadsnämnden).
Environment and responsibility
IBT's operations do not pose any specific environmental risks and do not require any specific
environmental permits or decisions from authorities. The Board of Directors believes that the
company conducts its operations in accordance with applicable health and safety rules and
offers its employees a safe and healthy working environment.
Diversity and gender equality
IBT should be a workplace where diversity and gender equality are natural parts of the business.
A workplace characterized by diversity and gender equality is necessary for IBT to be an
attractive workplace and to achieve set goals. Recruitment shall be based on competence
requirements, diversity and gender equality.
Sustainability
IBT is to be perceived as an innovative and creative company, which stands for quality and
health and plays a role in society. It is important for IBT to work with sustainability. Respect for
human rights, the environment and anti-corruption must characterize our everyday lives through
business strategies, financing processes, investments and purchases.
According to the Swedish Annual Accounts Act (Årsredovisningslagen), there is no requirement
that the Company prepare a Sustainability Report.
57!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
Articles of Association
In accordance with IBT's articles of association, the Company will develop, manufacture, market
and sell pharmaceuticals directly or through subsidiaries or other forms of part-ownership or
partnerships and conduct related operations. The seat of the Board is Stockholm.
The Articles of Association do not contain any provisions on the appointment or dismissal of
directors or the amendment of the Articles of Association. Nor do the Articles of Association
contain any restrictions on the number of votes each shareholder can cast at a general meeting.
The Articles of Association can be found on IBT's website under the heading Investors /
Corporate Governance.
Annual General Meeting
In accordance with the Swedish Companies Act, the Annual General Meeting is IBT's highest
decision-making body and at the Annual General Meeting the shareholders exercise their voting
rights on key issues, for example establishing a report on comprehensive income and financial
position, disposition of IBT's results, granting discharge from the Board of Directors and the
Board of Directors, election of the Board of Directors and the CEO and remuneration to the
Board of Directors and auditors. In addition to the AGM, an Extraordinary General Meeting can
be called. In accordance with the Articles of Association, notice of the Annual General Meeting
and Extraordinary General Meeting are published in Post- och Inrikes Tidningar and on IBT's
website.
Annwall & Rothschild Investment AB, owns 9.09 percent of the capital and 29.31 percent of the
votes in the company.
Annual General Meeting 2022
At IBT's Annual General Meeting on May 4, 2022, The Annual General Meeting decided, inter
alia, the following:
● establishing of the income statement and balance sheet
● granted discharge for Board members and the CEO
● that no dividend is paid
● that the board shall consist of five members without deputies
● re-election of board members Margareta Hagman, Eva Idén, Anthon Jahreskog,
Kristina Sjöblom Nygren, Peter Rothschild. Noted that Robert Molander declined re-
election.
● re-election of Peter Rothschild as Chairman
● re-election of the registered accounting firm Deloitte AB
● that remuneration to be paid to the Chairman of the Board of SEK 300,000 and an
additional remuneration for the work of Chairman of the Board of SEK 400,000 and
to other members not employed by the company by SEK 150,000 each
● that audit fees should be paid according to approved invoice
● on the nomination committee in accordance with the nomination committee's
proposal
● on approval of the Board’s remuneration report
58!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
● on authorization for the Board to decide on issue of class B-shares in accordance
with the Board’s proposal
The Annual General Meeting 2023
The 2023 Annual General Meeting will be held on May 8, 2023 in Stockholm.
Notice of Annual General Meeting
Notice of Annual General Meeting shall be made through advertising in Post- och Inrikes
Tidningar and on the company's website. That notice should be announced in Svenska
Dagbladet and on the company's website.
Nomination Committee
The Annual General Meeting 2022 resolved that a Nomination Committee should be appointed
as follows: “The Chairman of the Board shall convene the three largest shareholders in the
company, who each nominate a representative to be a member of the Nomination Committee
together with the Chairman of the Board. At the composition of the nomination committee, the
ownership conditions as of June 30, 2022 will determine which are the largest shareholders in
terms of the number of votes. The representative of the largest shareholder in the nomination
committee at this time shall be the chairman of the nomination committee. If one of the three
largest shareholders waives their right to appoint a member to the nomination committee, the
next shareholder in size shall be given the opportunity to appoint a member to the nomination
committee. The names of the three members shall be published when appointed, however,
latest six months prior to the 2023 AGM. The period of mandate of the nomination committee
lasts until such time a new nomination committee has been appointed.”
If the shareholder who appointed the member no longer constitutes one of the three largest
shareholders in terms of voting rights, such member may, if the nomination committee deems
it appropriate, be dismissed and a member of the shareholder who is next in size in terms of
voting rights be given the opportunity to take his or her place. If an appointed member of the
nomination committee otherwise resigns from the nomination committee, the shareholder who
appointed the member in question shall have the right to appoint a new member of the
nomination committee. If the latter refrains from appointing a new member, the nomination
committee shall, if it finds it appropriate with regard to the remaining term of office, ask the
shareholder who is next in size in terms of voting rights whether he or she wishes to appoint a
member of the nomination committee.
The Nomination Committee shall prepare proposals on the following issues to be submitted to
the Annual General Meeting 2023 for resolution:
a) proposal for election of the Chairman of the Meeting
b) proposals of Board members
c) proposal for election of the Chairman of the Board
d) proposal for Board fees
e) proposals for election of the auditor
f) proposal for audit fees
59!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
g) proposal on reasonable costs for the nomination committee
h) proposals regarding nomination committee for the 2023 Annual General Meeting.
Mandate
The 2022 AGM decided on a mandate for the Board to, at one or more instances during the
period until the next AGM, decide to issue class B-shares. The Board may decide to issue
shares deviating from shareholders pre-emptive rights. Shares may be issued with or without
stipulation of contribution in kind, offset, or other conditions in accordance with 13 chapter 5 §
first section 6 of aktiebolagslagen.
With regard to the issue of shares with deviation from the shareholders' preferential rights
(directed issues), the board of directors shall not be able to make decisions that entail an
increase in the share capital by more than twenty percent in relation to the share capital that
exists when the authorization to issue shares is first used for a directed issue.
The issue in accordance with the authorization shall be made on market terms. The Board of
Directors shall be entitled to determine the other terms and conditions for issues under this
authorization and who shall be entitled to subscribe for the shares. The purpose of the
authorization is to give the board of directors flexibility in the work to ensure that the company
can appropriately raise capital for the financing of the company's continued clinical activities
and to enable a broadening of the ownership base in the company.
The Board
According to IBT's Articles of Association, the Board shall consist of a minimum of three and a
maximum of ten members and no deputies. The Board is elected annually at the AGM for the
period until the end of the next AGM. The Board of Directors has since the Annual General
Meeting 2022 consisted of five members elected by the AGM without deputies. Peter Rothschild
is indirect shareholder in IBT through Annwall & Rothschild Investment AB. Other members are
independent in relation to the company and company management.
The CEO is not a member of the Board but is adjunct to all Board meetings. Other officers in
the company participate in Board meetings as rapporteur. The Board of Directors has adopted
a rules of procedure, including the division of work between the Board and the CEO and the
structure of the Board's work during the year. In addition to the responsibilities of the Swedish
Companies Act and the Articles of Association is regulated following the Board's rules:
- Hold at least 4 board meetings, in addition to the statutory meeting
- Determine the overall objectives of the company's operations and decide on the
company's strategy and evaluate the operational management and risk assessment in
the company.
- Approve budget and corresponding long-term plans including investment budget
- Process matters relating to investments and the like in the amount of five hundred
thousand (500,000 SEK) or other commitments for the company, which entails a cost to
the company exceeding five hundred thousand (500,000 SEK)
- Decide on the purchase and sale of real estate, shares or acquisitions of another
company's operations in excess of five hundred thousand (500,000 SEK)
60!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
- Determine the annual report, the directors' report and the interim reports
- Borrowing
- Enter into an agreement with a term of more than three years
- Initial processes of large scope and settlement of disputes of significant importance
- Other issues of significant economic or other importance
The Board of Directors is responsible for monitoring the Company's financial position, for
monitoring the efficiency of the Company's internal control, internal audit and risk management,
being informed of the audit of the 2021 financial statements and for reviewing and monitoring
the auditor's impartiality and independence.
In addition, the Board of Directors has adopted the CEO's instruction, certificate instruction
including instructions regarding liquidity management and currency management policy. The
work order, CEO instruction and attestation instruction are tested at least once a year.
The Board of Directors presence in 2022
Independent in relation to
Name
Position
Member
since
Company and
senior
management
Major
shareholders
Attendance
2022
Peter Rothschild
Chairman of the
Board
3
2011
No
1
No
2
8/8
Margareta
Hagman
Board member
2015
Yes
Yes
7/8
Eva Idén
Board member
2017
Yes
Yes
8/8
Anthon Jahreskog
Board member
3
2017
Yes
Yes
8/8
Robert Molander
4
Board member
2020
Yes
Yes
4/4
Kristina Sjöblom
Nygren
Board member
2018
Yes
Yes
8/8
1
In his role as working chairman, Peter Rothschild is not considered independent in relation to company.
2
Peter Rothschild is a partner in Annwall & Rothschild Investments AB, the Company's largest
shareholder.
3
Member in Remuneration Committee. The Remuneration Committee has, besides ongoing contact, had
three meetings during 2022 with full attendance.
4
Robert Molander resigned the Board of Directors at AGM May 4, 2022
If a member has not been able to attend a board meeting, this member has had the opportunity
to present his / her views to the chairman before the meeting.
Board meeting agenda is as follows where appropriate:
61!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
- Business Plans
- Business follow-up
- Investments
- Strategy
- Performance reports
- Significant agreement
- Budget
- Financial statements
The Board continuously evaluates its work through open discussions and annually performs a
written evaluation of its work. The Nomination Committee is informed of the results of the
evaluation.
Remuneration of the Board
At the 2022 Annual General Meeting, it was decided to pay a fee of SEK 300,000 to the
Chairman of the Board, an additional fee of SEK 400,000 to the Chairman in his
assignmest to be working chairman of the board and SEK 150,000 to the other members,
as well as fees for committee work.
Chairman of the Board
The Chairman of the Board is responsible for leading the work of the Board and for the Board
to fulfill its obligations in accordance with the Companies Act and the Board's rules of
procedure. Through continuous contacts with the CEO, the Chairman of the Board shall monitor
the company's development and ensure that the Board receives the information required for the
Board to fulfill its commitment. In addition, the Chairman, as a working Chairman of the Board,
actively participates in financing issues, licensing issues and presentations to the market and
assists company management in business development. Peter Rothschild has been Chairman
of the Board since 2011.
The CEO
The CEO is responsible for the company's business development and manages and coordinates
day-to-day operations. The CEO has an instruction decided by the Board of Directors, which
regulates, among other things, his work with management and development of the company as
well as continuous reporting and decision-making to the Board. The Managing Director
prepares the necessary information and decision-making documentation such as reports
regarding, among other things, the company's finances, order situation, significant business
and strategic issues before Board meetings, and is a rapporteur and submits motivated
proposals for decisions. In addition, the President keeps the Chairman of the Board regularly
informed about the company's operations.
The Managing Director is solely responsible for external communication.
The Board annually evaluates the CEO's work. In this evaluation, no one from the company
management is present.
62!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
Management
The management of IBT consists of five people.
The management team is led by the CEO and is responsible for planning, directing and
monitoring the day-to-day operations. Minuted meetings are held every week. The powers and
responsibilities of the CEO, in addition to being regulated by the Companies Act, are defined in
the CEO instructions adopted by the Board. The powers and responsibilities of company
management are defined in job descriptions and attestation instructions.
Remuneration Committee
The Board has appointed a Remuneration Committee consisting of Chairman of the Board Peter
Rothschild and Board member Anthon Jahreskog. Anthon Jahreskog is Chairman of the
Remuneration Committee.
The Remuneration Committee shall prepare questions regarding remuneration and other terms
of employment for the CEO and other senior executives who together form the company
management. The Remuneration Committee has held three meetings. Peter Rothschild and
Anthon Jahreskog were present at all three meetings.
Principles for remuneration to senior executives are set at the Annual General Meeting. The
remuneration committee's task is to prepare proposals for senior executives in accordance with
these principles.
Auditors
IBT's auditors are normally elected for a period of one year at the AGM. At the 2022 Annual
General Meeting, re-election of Deloitte AB was resolved for the period up to the end of the
Annual General Meeting that will be held in 2023. The Auditing Company has appointed Jenny
Holmgren as the designated Auditor. Remuneration to the auditors is paid, in accordance with
the decision of the Meeting, on an ongoing basis.
The auditors review the Board of Directors and the CEO's management of the company and the
quality of the company's financial reporting. The auditors also carry out, on behalf of the Board,
an audit of the financial statements, an audit of the annual report, and a review of a quarterly
report.
The auditor’s report their audit to the shareholders through the audit report, which is presented
at the AGM. In addition, written and oral reports are submitted to the company management
and the board. At the board meeting in connection with the review of the third quarter, the
auditor participates in the reporting of comments from the ongoing review during the financial
year regarding the company's internal control and preparation for the annual accounts.
The auditors also submit an audit opinion on the corporate governance report and a report on
the review of remuneration to senior executives.
For information on remuneration to the auditors, see note 5 in the annual report.
63!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
The Board of Directors has decided that independent members of the Board possess
accounting expertise as well as the Board's ongoing review of the financial reporting and with
regard to the company's limited size and scope of transactions, to appoint no Audit Committee.
Furthermore, the entire Board meets with the auditor at least once a year without the presence
of the company's CEO or another of the company management.
The Board's description of internal control regarding the financial reporting
for the financial year 2022
Introduction
According to the Swedish Companies Act, the Swedish Annual Accounts Act and the Swedish
Code of Corporate Governance, the Board is responsible for the internal control. This
description has been prepared in accordance with these provisions and thus limited to internal
control over the financial reporting.
64!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
Internal control over financial reporting
The Board of Directors is responsible for ensuring that the company's organization is designed
so that the accounting, asset management and the company's financial conditions are
otherwise controlled in a satisfactory manner.
The Board of Directors adopts annually rules of procedure for the work of the Board and
instructions for the division of work between the Board and the CEO. The rules of procedure
specify which matters require the approval or confirmation of the board. At the board meetings,
the CEO prefers matters that require the board's treatment.
The Managing Director shall ensure that the Board receives a factual, detailed and relevant
information base for the Board to be able to make well-informed decisions and that the Board
is kept regularly informed of the development of the company's operations and financial
position.
Within IBT, internal control of financial reporting is focused, for example, on ensuring efficient
and reliable management and accounting of purchases and sales, other income accounting and
accounting of the company's financing. The internal control environment mainly comprises the
following five components: control environment, risk assessment, control activities, information
and communication and follow-up.
Control environment
In addition to the rules of procedure between the Board and the CEO, IBT's control structure is
based on the company's organization and ways of conducting operations where the roles and
responsibilities are defined and communicated in the organization. Employee awareness of
maintaining good control over financial reporting is satisfactory and analysis and follow-up of
financial progress is done monthly. Financial reports and compilations are made by IBT's
finance department and reported to the Board on a quarterly basis and to company
management on a monthly basis.
Risk assessment
The company works continuously with risk assessment and risk management to ensure that the
risks to which the company is exposed are managed within the framework that is ultimately
determined by the Board of Directors. The company management annually analyzes the
business processes of the business with regard to efficiency and risks. This work includes
identifying significant risks of errors in financial reporting and ensuring that there are appropriate
processes and controls within the business to manage these risks. Processes that are
considered to be of particular importance to IBT are research and development. A more detailed
description of the risk exposure can be found in the annual report.
Control activities
The risks identified in financial reporting are managed through a number of control measures in
the business processes. Processes, policies and controls are reviewed and updated annually.
The purpose is to detect, prevent and correct errors and deviations. The control structure also
includes, among other things, established powers (eg attestation), division of work, IT risks and
65!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
the management's monthly review of financial information. The company controls the
subcontractor's fulfillment of current services in accordance with agreements, including quality
aspects.
Information and communication
IBT has information and communication pathways aimed at promoting completeness and
accuracy in financial reporting. Certificate arrangements and communication policies are
distributed to all employees and kept available on the company's intranet. The entire company's
staff meet approx. once a month to increase knowledge of processes and objectives and to
exchange information and experience.
Evaluation
The company management annually evaluates internal control. The company's elected auditors,
Deloitte AB, also annually review a selection of IBT's routines and internal controls. The Board
then evaluates the information and ensures that measures are taken regarding the deficiencies
and proposals that have emerged.
The company has no special internal audit function (internal audit). The Board has made the
assessment that, given the company's size and scope of transactions, as well as the expertise
in the area that the Board possesses and the Board's meeting with the auditor, there is no
reason to establish a formal internal audit department.
The auditor’s examination of the corporate governance statement
To the general meeting of the shareholders in Infant Bacterial Therapeutics AB (publ)
corporate identity number 556873-8586
Engagement and responsibility
It is the board of directors who is responsible for the corporate governance statement for the
financial year 2022-01-01 - 2022-12-31 on pages 59-67 and that it has been prepared in
accordance with the Annual Accounts Act.
The scope of the audit
Our examination has been conducted in accordance with FAR’s standard RevR 16 The
auditor’s examination of the corporate governance statement. This means that our examination
of the corporate governance statement is different and substantially less in scope than an
audit conducted in accordance with International Standards on Auditing and generally
accepted auditing standards in Sweden. We believe that the examination has provided us with
sufficient basis for our opinions.
Opinions
A corporate governance statement has been prepared. Disclosures in accordance with
chapter 6 section 6 the second paragraph points 2-6 the Annual Accounts Act and chapter 7
section 31 the second paragraph the same law are consistent with the annual accounts and
the consolidated accounts and are in accordance with the Annual Accounts Act.
66!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
Stockholm 22 March 2023
Deloitte AB
Signature on Swedish original
Jenny Holmgren
Authorized Public Accountant
67!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
DEDUCTION OF CERTAIN KEY FIGURES
2022
Jan-Dec
2023
Jan-Dec
Cash flow per share
Cash flow for the period, 000's
-83 911
-55 532
Average number of shares
11 226 184
11 226 184
Cash flow per share (SEK)
-7.47
-4.95
Equity per share
Equity, 000's
331 705
395 254
Number of shares at end of period
11 226 184
11 226 184
Equity per share (SEK)
29.51
35.21
Equity ratio
Equity, 000's
331 705
395 254
Total equity and liabilities, 000's
349 619
408 478
Equity ratio %
95%
97%
SHARES
On January 1, 2022 and December 31, 2022, respectively, the total number of shares amounted
to 11 226 184 of which 377 736 class A-shares carrying ten votes and 10 848 448 class B-
shares carrying one vote.
IBT’s class B share was listed on Nasdaq Stockholm, Mid Cap, on September 10, 2018.
The number of shareholders amounted to 5 485 on December 31, 2022 according to Euroclear
Sweden compared to 5 790 on December 31, 2021.
Share price development
IBTs share price decreased from 66.80 SEK to 50 SEK during 2022. Market value as of
December 31, 2022 amounted to 561 MSEK.
Analysts covering IBT:
SEB: Christopher W. Uhde, PhD, Carl Mellerby, Mattias Vadsten
68!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
Ownership December 31, 2022
Name
Class
A-shares
Class
B-shares
Share
capital %
Votes
%
ANNWALL & ROTHSCHILD INVESTMENT AB
377,736
510,478
8.09
29.31
SIX SIS AG, W8IMY
-
1,194,861
10.64
8.17
FJÄRDE AP-FONDEN
-
1,120,000
9.98
7.66
SWEDBANK ROBUR FONDER
-
540,000
4,81
3.69
AMF AKTIEFOND
-
501,585
4.47
3.43
TREDJE AP-FONDEN
-
501,579
4.47
3.43
SKANDINAVISKA ENSKILDA BANKEN
-
347,673
3.10
2.38
ÅLANDSBANKEN
-
331,390
2.95
2.27
UNIONEN
-
322,196
2.87
2.20
DANGOOR, DAVID
-
306,421
2.73
2.10
Total 10 largest shareholders
377,736
5,676,183
54.11
64.64
Other shareholders
-
5,172,265
45.89
35.36
Total
377,736
10,848,448
100.00
100.00
Source: Euroclear Sweden
69!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
MANAGEMENT
Staffan Strömberg
CEO since 2013. Born 1967.
M.Sc. in chemical engineering and Ph.D. in organic chemistry from the Royal Institute of
Technology in Stockholm.
Staffan Strömberg has more than 20 years of experience in the pharmaceutical industry.
Besides his roles at Billerud Tenova Bioplastics and at the Swedish Medical Products Agency,
he has also been Vice President of NIcOx France, had various project management positions
in AstraZeneca and been Head of R&D of Swedish Orphan.
Member of the Board of Directors of Eteboxagu AB and BioGaia Pharma AB.
Former CEO of Billerud Tenova Bioplastics AB and Head of Medical Devices at the Swedish
Medical Products Agency.
Shareholding in the Company: 43 228 series B shares and 45,864 series B shares through the
wholly owned company Eteboxagu AB and 50 000 warrants 2020/2024 and 120 000 warrants
2022/2025.
Anders Kronström
Cheif Operating Officer since 2018. Born 1967.
M.Sc., M.B.A.
Anders Kronström has over 20 years of experience working in the pharmaceutical industry. His
experience spans across all stages of drug development in different disease segments. During
his career at AstraZeneca he has had senior leadership positions within Project Management
and Business Development. More recently, he was a CEO of Biosergen AS, a Norwegian
biotechnology company.
Shareholding in the Company: 8 170 shares of series B and 40 000 warrants 2020/2024 and
75 000 warrants 2022/2025.
Maria Ekdahl
Cheif Financial Officer since 2022. Born 1973.
Master of Business Administration.
Maria has several years of financial background in both accounting and business controlling.
She has experience in various organizations such as Coca-Cola, Telenor, Karolinska Hospital
and the Swedish Film Institute.
Shareholding in the company: 250 shares of series B.
70!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
Robert Molander
Cheif Commercial Officer since 2022. Born 1965.
Robert holds an MBA from Washington University and two bachelor's degrees from Miami
University in Economics and International Studies.
Robert has over 25 years of experience working in life science organizations launching and
commercializing drugs in the US at companies such as Pfizer and Novartis. He has also
served as an Executive Council Member at Harvard Medical School.
Shareholding in the company: 10 000 shares of series B and 20 000 warrants 2022/2025.
Professor Jonas Rastad, MD, Ph.D.
Chief Medical Officer since 2019. Born 1950.
Jonas has in excess of 20 years of experience as academic surgeon and has published 250
articles in peer review-magazines. He has held several leading positions at AstraZeneca in
Sweden, Japan, The UK and USA. In addition, he has 13 years of experience of public
leadership positions, among other head of the Kalmar regional hospital, Västerbottens county
council and CEO of Region Skåne.
Shareholding in the Company: None
BOARD OF DIRECTORS
IBT’s Board of Directors consists of five ordinary members, including the chairman of the
board, with no deputy board members, all of whom are elected for the period up until the end
of the annual shareholders’ meeting 2022.
Peter Rothschild
Chairman of the Board since 2011. Born 1950.
Master of Business Administration from Stockholm School of Economics.
Founder and Chairman of the Board of Directors of BioGaia AB, BioGaia Pharma AB and
Annwall & Rothschild Investments AB. Board member of Allbright.
Previously CEO of BioGaia (publ) and member of the Board of Directors of Moberg Pharma AB
(publ).
Shareholding in the Company: 377,736 series A shares and 510,478 series B shares through
Annwall & Rothschild Investments AB, a company co-owned with Jan Annwall.
71!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
Margareta Hagman
Board member since 2015. Born 1966.
Master of Business Administration, Örebro University.
Advisor and consultant in business, accounting and finance.
Previous positions: Deputy CEO and CFO of BioGaia AB (publ). Member of the Board of
Tagmaster AB.
Shareholding in the Company: 3,570 series B shares.
Eva Idén
Board member since 2017. Born 1966.
Civil engineer in chemistry, Chalmers tekniska högskola.
Chairman of the board of Better & Beyond AB.
Previously held management positions at AstraZeneca AB.
Shareholding in the company: 51 series B shares.
Anthon Jahreskog
Board member since 2017. Born 1980.
Candidate degree in Management and systems, City University, London. Bachelor of business
administration, Master of science in financial management at University of Cape Town.
Board member of BioGaia AB (publ) and Fast Track Holdings Ltd.
Until July, 2015 Chief Operating Officer, Fund Linked Products, Credit Suisse Investment
bank, London. Anthon is a business strategy consultant in several industries.
Shareholding in the company: 3 200 series B shares.
Kristina Sjöblom Nygren
Board member since 2018. Born1961.
Kristina has received a Doctor of Medical Sciences from Karolinska Institutet and is a licensed
physician.
She is Chief Medical Officer, Head of Clinical Development, since May 2021 at Egetis
Therapeutics AB (publ) in Stockholm. Kristina Sjöblom Nygren has extensive experience from
the pharmaceutical industry, where she has held among other positions Chief Medical Officer,
Head Development at Santhera Pharmaceuticals in Basel and Head of Clinical Development at
SOBI in Stockholm.
Shareholding in the company: 100 series B shares.
72!
Infant Bacterial Therapeutics AB
(publ)
Annual Report 2022
Contact Persons
Staffan Strömberg, CEO
Maria Ekdahl, CFO
Contact Information
Infant Bacterial Therapeutics AB (Reg. no. 556873-8586) Bryggargatan 10
111 21 Stockholm, Sweden
Email: info@ibtherapeutics.com
www.ibtherapeutics.com