TRLS Trellus Health Plc

Trellus Health plc

("Trellus Health", the "Company" or the "Group")

Interim results

Excellent early outcomes from B2B2C agreement with large US health plan, expansion of business verticals

LONDON, U.K. AND NEW YORK, U.S. (26 September 2024). Trellus Health plc (AIM: TRLS), a healthcare company delivering innovative, scientifically validated programs and technologies designed to facilitate the management of chronic conditions, improve health outcomes and lower the costs of care, announces its unaudited interim results for the six months ended 30 June 2024.

Operational highlights (including post-period end)

·   Business-to-business-to-consumer ("B2B2C") agreement signed with a large US national health plan, focused on inflammatory bowel disease ("IBD") condition management, intended to run for up to 21 months, during which time members of the health plan with IBD receiving care in two US states will be eligible to participate in the Trellus Elevate™ IBD program.

-    Whilst the early outcomes of enrolled members are strong and supports the value proposition of Trellus Elevate™, to date enrolment has been slower than expected with small numbers of enrolled members and subsequently the enrolment phase has been extended to allow continued emphasis on enrolling new members.

·    Signed content licensing agreements with two large pharmaceutical companies, highlighting the diversification and applicability of Trellus Health's proprietary resilience-based methodology. Increased commercial focus on agreements with pharmaceutical companies and clinical trial research organizations, where Trellus Elevate™ and resilience-based assessments can provide value for partners.

·    In June 2024, Kevin Murphy appointed as an independent Non-executive Director and Chair, and in September, Brian Griffin appointed as an independent Non-executive Director; both adding significant experience of the US healthcare industry as the Company accelerates its commercial strategy.

·    In February 2024, Christopher Mills stepped down as Non-executive Director.

Financial highlights                                                   

·    Net cash of $8.0m at 30 June 2024 (30 June 2023: $15.8m), with the Company's cash runway further extended into late Q3 2025.

·    Adjusted EBITDA* loss of $3.62m, in line with management expectations (30 June 2023: $3.16m loss) with revenue in the period of $50k (30 June 2023: $14k).

* Earnings before interest, tax, depreciation and amortisation adjusted for share-based payments

Dr. Marla Dubinsky, Chief Executive Officer of Trellus Health, said:

"Following the completion of our early pilot programs, in the first half we signed a B2B2C contract with a large US health plan, which has made Trellus Elevate™ more accessible to IBD patients. We continue to work closely with the health plan and are collaborating to enrol as many eligible members as possible onto the platform.

"Our content licensing agreements with two large pharmaceutical companies have also shown the value of our solution and a new revenue source. Trellus Elevate™ and our proprietary resilience-based assessments can provide significant value to pharmaceutical companies and within clinical trials, by enhancing medication adherence and reducing participant trial attrition and screening failures, and we intend on pursuing further agreements in these spaces in future.

"We remain focused on cash management with our disciplined approach extending our cash runway into late Q3 2025."

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About Trellus Health plc (www.trellushealth.com)

Trellus Health (AIM: TRLS) is a healthcare company providing value-based innovative solutions and services for chronic condition management that prioritises improved outcomes and member experiences while managing costs of care.

Trellus Health® integrates its proprietary resilience-based methodology with the technology, tools, and expert coaching and educator team to deliver Trellus Elevate™, a whole-person technology-enhanced experience that meets each individual's unique needs and empowers them to master their physical and emotional health. Trellus Elevate's™ clinically proven solutions result in relieving disease burden, building self-management skills and promoting positive health behaviours that improve outcomes and enables thriving in the face of a chronic condition.

The Company's proven whole person approach recognises the interconnectedness of various aspects of a person's life and aims to address the whole spectrum of factors that influence behaviour, to promote comprehensive well-being and human flourishing in a way that aligns with value-based care. Trellus Health's approach enables better health outcomes in a member-centric, personalised and comprehensive holistic solution.

The Company was founded by Mount Sinai faculty members Marla C. Dubinsky, MD and Laurie Keefer, PhD, both experts at treating and healing both the physical and emotional impacts of IBD and have been innovators for whole-person healthcare for a combined 50 years.

The Company is initially focusing on chronic costly GI conditions that have high mental health burden, such as inflammatory bowel disease ("IBD") which includes the chronic incurable conditions of Crohn's Disease and ulcerative colitis. Given the common emotional and mental health struggles often experienced by individuals suffering from a variety of chronic conditions, Trellus Health considers its approach to have potential utility and demand across many conditions.

The Trellus Elevate™ program incorporates the GRITT™ methodology and learnings on resilience from clinical research and practice conducted at the Mount Sinai IBD Center for more than seven years. This proprietary, resilience-driven methodology has been scientifically validated to demonstrate meaningful improvements in patient outcomes, 71% reduction in Emergency Department (A&E) visits, and 94% reduction in unplanned hospitalisations, which the directors of the Company believe indicates the potential for significant cost savings for healthcare payers and health systems. Patients with IBD managed with the proprietary resilience methodology also experienced a 49% reduction in required opioid use and a 73% reduction in corticosteroid use 12 months following starting the program which is a major indicator of improved health outcomes^1.

Shares in Trellus Health were admitted to trading on AIM in May 2021, under the ticker TRLS. For more information on Trellus Health, visit: www.trellushealth.com

¹ Source: https://www.sciencedirect.com/science/article/pii/S1542356521012258

Forward-Looking Statements

Certain statements made in this announcement are forward-looking statements. These forward-looking statements are not historical facts but rather are based on the Company's current expectations, estimates, and projections about its industry; its beliefs; and assumptions. Words such as 'anticipates', 'expects', 'intends', 'plans', 'believes', 'seeks', 'estimates', and similar expressions are intended to identify forward-looking statements. These statements are not guarantees of future performance and are subject to known and unknown risks, uncertainties, and other factors, some of which are beyond the Company's control, are difficult to predict, and could cause actual results to differ materially from those expressed or forecasted in the forward-looking statements.

The Company cautions security holders and prospective security holders not to place undue reliance on these forward-looking statements, which reflect the view of the Company only as of the date of this announcement. The forward-looking statements made in this announcement relate only to events as of the date on which the statements are made. The Company will not undertake any obligation to release publicly any revisions or updates to these forward-looking statements to reflect events, circumstances, or unanticipated events occurring after the date of this announcement except as required by law or by any appropriate regulatory authority.

CEO STATEMENT

The Company has made substantive progress in the commercial delivery of its resilience-based methodology so far in 2024. In its core business-to-business-to-consumer ("B2B2C") model, Trellus Health™ signed a contract and established an active collaboration with a large US health plan; whilst also working to expand the value proposition of Trellus Elevate™ into areas such as pharmaceutical patient support programs ("PSPs") and clinical trials. Our continued focus on disciplined cash management has extended our cash runway further into late Q3 2025, and we have successfully added significant experience of the US managed care industry to our Board, positioning us strongly for further commercial traction.

Commercial progress

B2B2C

Our B2B2C model continues to focus on executing agreements with regional and national health plans, employers, health systems, gastrointestinal ("GI") provider networks and pharmaceutical manufacturers to make Trellus Elevate™ available to individuals diagnosed with inflammatory bowel disease ("IBD").

In February 2024, Trellus Health signed an agreement with a large US health plan, focused on IBD condition management, making Trellus Elevate™ more accessible to patients with IBD.  The agreement is intended to run for up to 21 months, during which time certain members of the health plan with IBD that are receiving care in two US states will be eligible for participation in the Trellus Elevate™ IBD program. In March 2024, the health plan sent out its first of multiple marketing materials to its providers and members, highlighting Trellus Elevate™ as a complimentary health benefit resource. Concurrently, we are directing our own digital marketing efforts towards the two states covered by the agreement, with engagement and other key milestones reviewed during joint  steering committee calls.

Despite the small enrollment number, the early key performance indicator outcomes directly linked to our program from the agreement have been highly positive, including:

·   90% of those members who complete the assessment and meet an Elevate Navigator enroll in the program.

·    89% of members improved their resilience scores after completing their Elevate program.

·    78% of members reported greater confidence in managing their condition, engaging with their physician. treatment plan and adhering to their medication plan within three months of starting their personalized program.

·   Members were active on the platform for an average of 10 weeks with 3.5x average weekly platform engagement.

Increasing the resilience and self-confidence of members, and consequently their adherence to treatment plans and ability to self-manage their condition, can significantly improve health outcomes and lower total costs of care through lower healthcare utilisation. These early outcomes, directly linked to our program, have therefore been greatly encouraging to see.

With our partner, we have expanded the enrolment phase of the agreement beyond the initial 6 months where we are prioritizing the onboarding of eligible members onto the platform while also fostering sustained engagement from enrolled members. I am confident that we will be able to demonstrate a clear and substantial return for our partner, and further validate the value of Trellus Elevate™ to prospective partners.

Expansion of verticals

Trellus Health also made significant progress during the period in working to expand the value of Trellus Elevate™ and its resilience-based methodology into the pharmaceutical sector.

For pharmaceutical companies, patients with higher resilience and greater self-efficacy have demonstrated improved medication adherence. Patient Support Programs (PSPs) are services provided by pharmaceutical companies designed to help patients manage their medical conditions more effectively in conjunction with prescription medications or therapies, to improve health outcomes by offering resources and support tailored to the needs of individual patients. By integrating our curated resilience and self-efficacy educational modules within the PSPs, or by integrating the full Trellus Elevate™ program with coaching and resilience curriculum into the PSP, pharmaceutical companies can enhance value by enabling better adherence to medication, increased and more consistent prescription refills.

In clinical trials, screening for resilience and delivering resilience training ahead of a trial can optimise the inclusion criteria, reducing clinical screen failures (and associated costs), reducing trial attrition attributed to low resilience, and potentially resulting in a faster trial completion. In addition, a resilience assessment could be used as part of a trial's patient-reported outcome measure, exploring whether Trellus Elevate™ resilience scores can impact trial outcomes.

During the period, we signed our first two licensing agreements with pharmaceutical industry partners for elements of our resilience-based methodology. One agreement is for the use of resilience-based assessments in the setting of a clinical trial and the other is for the use of customized self-efficacy educational content. Both agreements generated revenue during the period and show the increasing value that B2B2C partners are placing on our scientifically validated methodology to assess resilience, which can be applied to many areas beyond chronic condition management.

We are in discussions with other potential partners for further agreements utilising our methodology and whilst  no certainty can be given as to the timing or outcome from negotiations we will update the market as appropriate regarding these.

Enhancing the user and partner experience

We secured SOC 2 Type 2 designation for Trellus Elevate™, which is considered the gold standard accreditation for a service organisation in relation to its security, processing integrity and privacy controls and practices.

In 2024, we have enhanced our technological capabilities further, enabling us to scale more efficiently through structuring and tailoring our solution for specific populations. Given our previous investment in developing an agile platform, coupled with our flexible methodology that can be applied to many chronic indications, this can be done effectively at minimal spend, broadening our appeal to a wider range of potential B2B2C clients.

Board and Senior Management Team

In June, we announced the appointment of Kevin L. Murphy Jr. as our new Chair, following the resignation of Dr. Daniel Mahony after his acceptance of a new role which required him to relinquish his pre-existing Board roles. Kevin is an experienced healthcare executive, having worked in senior roles for both large and small organisations in the healthcare, insurance and pharmacy industries. Kevin recently retired from CVS Health Corporation, a Fortune 500 healthcare company providing advanced health care from pharmacy services and health plans to health and wellness.

In February, we announced that Christopher Mills had stepped down from his role on the Board as a Non-Executive Director. Following this, a key focus for us was to appoint a new director to the Board with significant experience of the US managed care industry.

Post-period end, we announced the appointment of Brian Griffin, as a Non-Executive Director. Brian's experience includes serving as Chairman and Chief Executive Officer at Diplomat Pharmacy Inc. (NYSE: DPLO), the largest independent specialty pharmacy and pharmacy benefit manager in the United States. Brian also spent over five years at Anthem, Inc. (now called Elevance Health), an American health insurance provider, where he led their $40bn+ revenue Commercial and Speciality businesses, including Anthem's 14 national Blue Cross and Blue Shield Plans.

Both Kevin and Brian have brought in a wealth of expertise across the US healthcare industry and the pharmaceutical sector, greatly expanding our connectivity within the US healthcare ecosystem, with their expertise in strategy, care delivery and managed care, already proving hugely valuable to the Company.

I would like to again thank Daniel and Christopher for their contributions to the Company and welcome Kevin and Brian to the Board.

Financial review

During the period, we continued our focus on cash discipline, without impeding upon our execution of commercial strategy. Our adjusted EBITDA loss for the period was $3.62m (30 June $3.16m loss), was in line with management expectations.  Administrative costs for the first half were $4.1m (30 June 23: $3.8m.)

As of 30 June 2024, the Company's net cash position was $8.0m (30 June 2023: $15.8m; 31 December 2023: $12.2m). We have extended our cash runway into late Q3 2025, assuming only current levels of revenue.

Outlook

Signing the B2B2C agreement with a large US health plan and establishing an active collaboration demonstrated positive commercial progress. The focus is now to enrol patients on the platform as the positive early outcomes from the small number of enrolled patients, have been encouraging to see. Our team and our partner will continue to work hard to ensure further success and the engagement and improvement in health outcomes for people with IBD.

Also encouraging has been the exploration of new ways to leverage our methodology and provide value for partners. This has been underlined by our first two licensing agreements with pharmaceutical companies, but securing further partnerships, by enhancing pharmaceutical PSPs, or incorporating resilience assessments within clinical trials, will also be a key focus for the business going forward. A key benefit for us that our methodology is condition-agnostic - whilst IBD is our initial use case, it can be utilised in management of many more chronic conditions, and we are able to adapt quickly to client specifications, and customizing programs at little-to-no additional spend, maximising the opportunity ahead of us.

Whilst no certainty can be given as to the timing or outcome from negotiations, we are in discussions with potential partners across all our commercial models, including two later-stage discussions and we look forward to updating the market as appropriate.

I would like to thank the entire Trellus Health® team for their hard work so far in 2024, and our shareholders for their continued support.