Q1 2024 Cerus Corp Earnings Call

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Good day, ladies and gentlemen, thank you for standing by and welcome to the serious Corporation first quarter 2024 earnings conference call. After the speaker's presentation there'll be a question and answer session to ask a question. During this session. Please press star one one on your telephone and wait for your name to be announced.

Operator: Good day, ladies and gentlemen. Thank you for standing by, and welcome to the Cerus Corporation first quarter 2024 earnings conference call. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, please press star 11 on your telephone and wait for your name to be announced. To withdraw your question, please press star 11 again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to Jessica Hanover, Cerus Vice President of Corporate Affairs. Dr. Hanover.

Operator: Draw. Your question. Please press Star one again, please be advised that today's conference is being recorded I would now like to hand, the conference over to Jessica Hanover serious Vice President of corporate Affairs Doctor Hangover.

Jessica Hanover: You may begin.

Jessica Hanover: Thank you and good afternoon.

Jessica Hanover: Thank you and good afternoon. I'd like to thank everyone for joining us today.

Speaker Change: And thank everyone for joining us today as part of today's webcast. We are simultaneously displaying slides that you can follow you can access the slides from the Investor Relations website at IR Dot dot.

Jessica Hanover: As part of today's webcast, we are simultaneously displaying slides that you can follow. You can access the slides from the Investor Relations website at ir.cerus.com. With me on the call are O.B. Greenman, Sirius' president and chief executive officer; and Vake Jayor Rahman, Sirius' Chief Operating Officer.

Jessica Hanover: Dot com.

Jessica Hanover: With me on the call are Obi, Greenman, Cerus, President and Chief Executive Officer.

Jessica Hanover: Rahman cirrhosis, Chief operating Officer, Kevin Green, <unk>, Chief Financial Officer, and Carol Moore, Cirrus as senior Vice President of regulatory affairs and quality.

Jessica Hanover: Cerus issued a press release today announcing our financial results for the first quarter ended March 31, 2024, and describing the company's recent business highlights.

Jessica Hanover: Kevin Green, Siris' Chief Financial Officer, and Carol Moore, Sears' Senior Vice President of Regulatory Affairs and Quality. Cerus issued a press release today announcing its financial results for the first quarter ended March 31, 2024 and describing the company's recent business highlights. You can access a copy of this announcement on the company website at www.cerus.com. I'd like to remind you that some of the statements we will make on this call relate to future events and performance, rather than historical facts and our forward-looking statements.

Jessica Hanover: You can access a copy of this announcement on the company website at Www Dot <unk> Dot com.

Jessica Hanover: I'd like to remind you that some of the statements we will make on this call related to future events and performance rather than historical facts and are forward looking statements.

Jessica Hanover: Examples of forward-looking statements include those related to our future financial and operating results, including our 2024 product revenue guidance, our expectations for operating cash flows and non-gap adjusted EBITDA performance, and our expected expense levels, expected future growth, and our growth trajectory, the availability and related timing of data from clinical trials, planned regulatory submissions and product launches, product expansion prospects, and other statements that are not historical facts. These forward-looking statements involve risks and uncertainties that could cause actual events, performance, and results to differ materially.

Jessica Hanover: The forward looking statements include those related to our future financial and operating results, including our 2020 for product revenue guidance, our expectations for operating cash flows and non-GAAP adjusted EBITDA performance and our expected expense levels expected future growth and our growth trajectory.

Jessica Hanover: Availability and related timing of data from clinical trials.

Jessica Hanover: Regulatory submissions and product launches product expansion prospects and other statements that are not historical facts.

Jessica Hanover: These forward looking statements involve risks and uncertainties that could cause actual events performance and results to differ materially. They are identified and described in today's press release, and our slide presentation and under risk factors in our Form 10-Q for the quarter ended March 31, 2020 for which we will file shortly.

Jessica Hanover: They are identified and described in today's press release, in our slide presentation, and under risk factors in our Form 10-Q for the quarter ended March 31, 2024, which we will file shortly. We undertake no duty or obligation to update this forward-looking statement. On today's call, we will also be discussing non-GAAP financial measures, including non-GAAP-adjusted EBITDA. These non-GAAP measures should be considered a supplement to, and not a replacement for, measures presented in accordance with GAAP.

Jessica Hanover: Undertakes no duty or obligation to update our forward looking statements.

Jessica Hanover: On today's call. We will also be discussing non-GAAP financial measures, including non-GAAP adjusted EBITA.

Jessica Hanover: These non-GAAP measures should be considered a supplement to and not a replacement for measures presented in accordance with GAAP.

Jessica Hanover: For a reconciliation of non-GAAP financial measures to the most comparable GAAP financial measures. Please refer to today's press release and the slide presentation available on our website.

Jessica Hanover: We will begin today with opening remarks from Obi.

Jessica Hanover: For a reconciliation of non-GAAP financial measures to the most comparable GAAP financial measures, please refer to today's press release and the slide presentation available on our website. We'll begin today with opening remarks from Obie, followed by Vivek to discuss recent business highlights, and then Kevin to review our financial results and expectations for the rest of 2024. And lastly, closing remarks from OB. Now, it's my pleasure to introduce Obie Greenman, Cerus' president and chief executive officer.

William M. Greenman: I would like to discuss recent business highlights then Kevin to review, our financial results and expectations for the rest of 2024, and lastly closing remarks from Obi.

William M. Greenman: And now it's my pleasure to introduce Obi Greenman, <unk>, President and Chief Executive Officer.

William M. Greenman: Thank you, Jessica, and good afternoon everyone. I'd like to open the call by spending a few minutes reviewing our recent positive performance..., as well as looking ahead at the key milestones on TAP. The first quarter of 24 was an important one in the history of the company, as we reported positive top-line results from the Phase 3 RISK-B clinical trial, the first of our two U.S. BARDA-funded trials for intercept red blood cells, or RBCs. We are thrilled that Recipe met its primary efficacy endpoint of non-inferiority of intercept RBCs compared to conventional RBCs and Complex Cardiovascular Surgery. And while Recipe was powered specifically for this primary endpoint,

William M. Greenman: Thank you Jessica and good afternoon, everyone I'd like to open the call by spending a few minutes reviewing our recent positive performance as well as looking ahead the key milestones on path for the company.

William M. Greenman: The first quarter of 2024 was an important one in the history of the company as we reported positive topline results from the phase III recipe clinical trial the.

William M. Greenman: The first of our two U S. BARDA funded trials for intercept red blood cells or rbcs.

William M. Greenman: We are thrilled that recipe met its primary efficacy endpoint of non inferiority of intercept rbcs compared to conventional rbcs and complex cardiovascular surgery patients.

William M. Greenman: And all recipe was power specifically for this primary efficacy endpoint. We are nonetheless also very pleased by the outcomes for the safety end points that we reported in March.

William M. Greenman: We're nonetheless also very pleased by the outcomes for the safety endpoints that we reported in March. We recognize that there's great interest in the details of the recipe results, and we look forward to being able to share more by way of media presentations and journal publications targeted for later this year, once the publications have been accepted. As we continue to enroll the REDIS study, our second U.S. part of the Funded Phase III trial for Intercept RBCs, we view the recipe readout as meaningful for the overall RBC program and supportive of our planned launch in Europe.

William M. Greenman: We recognize that there is great interest in the details of the recipe results and we look forward to being able to share more by way of media presentations and journal publications targeted for later this year once the publications have been accepted.

William M. Greenman: As we continue to enroll the <unk> study our second U S. Part of funded phase III trial for intercept Rbcs, we view the recipe readout is meaningful for the overall RBC program and supportive of our planned launch in Europe.

William M. Greenman: We are looking forward to meeting with the recipe trial investigators next month to review the findings from the study and to gain their insights into the opportunities for how to position this important data set with the transfusion medicine community. In summary, at this stage, the recipe data give us confidence in our Intercept RBC program.

William M. Greenman: We're looking forward to meeting with the recipe trial investigators next month to review the findings from this study and to gain their insights into the opportunities for how to position. This important dataset with the transfusion medicine community.

William M. Greenman: In summary at this stage the recipe data give us confidence in RF intercept RBC program and we look forward to sharing more with you in 2024.

William M. Greenman: And we look forward to sharing more with you in 2024. On the commercial front, we are increasingly confident in our expectations for 2024 and are reiterating our overall product revenue guidance of $172 to $175 million, inclusive of our intercept by bridging complex guidance of $8 to $10 million. Vivek will provide color into the continued traction we see across our portfolio and geography. Importantly, we also remain committed to Justice Ibbett Dobb's break-even for the full year 2024.

William M. Greenman: On the commercial front, we are increasingly confident in our expectations for 2024 and are reiterating our overall product revenue guidance of $172 million to $175 million.

William M. Greenman: <unk> of our intercept by bridge and complex guidance of $8 million to $10 million.

William M. Greenman: Vivek will provide color into the continued traction we see across our portfolio and geographies.

William M. Greenman: Importantly, we also remain committed adjusted EBITDA breakeven for the full year 2024.

William M. Greenman: Kevin will provide more insight into our pathway for continued improvement in this metric over time. I would now like to turn the call over to Vivek to discuss our commercial results and progress for the first quarter of 2024, as well as our outlook for the rest of the year.

William M. Greenman: Kevin will provide more insight into our pathway for continued improvement in this metric over time.

Vivek: I would like now to turn the call over to Blake to discuss our commercial results and progress for the first quarter of 2024 as well as our outlook for the rest of the year.

Vivek K. Jayaraman: Thank you, Obi, and good afternoon to everyone. We will continue our return to growth in Q1 2020. Across both product lines and geographic regions, we delivered strong performance in the quarter, and I am pleased with the collaboration and execution of the global commercial organization. In the U.S., our core platelet franchise is stabilizing, and we witnessed a return to growth in our base U.S. business. Anecdotally, we are hearing from blood center customers that collections are slowly starting to recover, and that platelet demand from their hospital customers remains strong.

Vivek: Thank you Obi and good afternoon to everyone.

Vivek K. Jayaraman: We continued our return to growth in Q1 2024.

Vivek K. Jayaraman: Both product lines and geographic regions, we delivered strong performance in the quarter.

Vivek K. Jayaraman: Pleased with the collaboration and execution of the global commercial team.

Vivek K. Jayaraman: In the U S. Our core platelet franchise is stabilizing and we witnessed a return to growth in our base U S business.

Vivek K. Jayaraman: Anecdotally, we are hearing from blood center customers that collections are slowly starting to recover and the platelet demand from their hospital customers remained strong.

Vivek K. Jayaraman: Furthermore, as we announced earlier, we received positive news from the FDA regarding our ability to increase platelet processing that shelf life.

Vivek K. Jayaraman: Furthermore, as we announced earlier, we received positive news from the FDA regarding our ability to increase platelet processing set shelf life. While our current forecast does not assume a major rebuilding of inventory at blood centers, the extended shelf life relieves a meaningful amount of pressure from our supply chain. As we work to further increase shelf life on a going forward basis, we would expect to see the benefits across both inventory and services.

Vivek K. Jayaraman: Our current forecast does not assume the major rebuilding of inventory of blood centers, the extended shelf life relieve the meaningful amount of pressure from our supply chain.

Vivek K. Jayaraman: And we work to further increase shelf life on a going forward basis, we would expect to see the benefit across both inventory and service levels.

Vivek K. Jayaraman: Turning to our efforts internationally, our commercial team delivered a strong performance in the quarter.

Vivek K. Jayaraman: Turning to our efforts internationally, our commercial team delivered a strong performance in the Meeting the Way was our continued progress in Canada in partnership with Canadian Blood Services or CVS. CVS is nearing full implementation of intercept platelets across their network, and pathogen reduction is now the standard of care for platelet safety. The validation efforts at Hammock Quebec are also going on. As a reminder, the Canadian market is split roughly 80-20 between CVS and Amazon.

Vivek K. Jayaraman: Leading the way with our continued progress in Canada in partnership with Canadian Blood services or CBS.

Vivek K. Jayaraman: Cbs's nearing full implementation of intercept platelets across their network and pathogen reduction is now the standard of care for platelet safety in Canada.

Vivek K. Jayaraman: Validation efforts at a handful of that are also going well as a reminder, the Canadian market is split roughly 80 20 between CBS and hemoglobin.

Vivek K. Jayaraman: Earlier in the quarter I had the opportunity to attend the annual Med Lab Congress in Dubai.

Vivek K. Jayaraman: Earlier in the quarter, I had the opportunity to attend the annual Med Lab Congress. Of note, I was pleased to see the strong interest in intercept across the Middle East. This region is a targeted growth area for our friends. With a significant increase in health care investment in countries such as Saudi Arabia and a clinical focus on blood safety, we believe the Gulf region is an ideal area for markets. Intercept is the only pathogen reduction system to be FDA approved and MDR cleared.

Vivek K. Jayaraman: Note I was pleased to see the strong interest in intercept across the middle East.

Vivek K. Jayaraman: The region is a targeted growth area for our franchise with a significant increase in health care investments in countries, such as Saudi Arabia, and a clinical focus on blood safety, we believe the Gulf region as an ideal area for market expansion.

Vivek K. Jayaraman: Intercept is the only pathogen reduction system to be FDA approved and MBR cleared we believe this regulatory distinction as a clear marker of advantage and really resonated with customers in the region.

Vivek K. Jayaraman: We believe this regulatory distinction is a clear marker of advantage and really resonates with customers in the region. I'm encouraged by the ongoing cultivation of expansion prospects that will ensure growth for years. Our U.S. Intercept Fibrinogen Complex, or IFC, delivered another strong quarter of growth during the period, and we feel confident in our ability to meet or exceed our full-year revenue guidance for IFC. During the quarter, we hosted a Scientific Advisory Board meeting for IFC, and we noticed an uptick in customer experience with and enthusiasm for the product.

Vivek K. Jayaraman: Courage by the ongoing cultivation of expansion prospects that will ensure growth for years to come.

Vivek K. Jayaraman: Our U S intercept fibrinogen complex for IFC delivered another strong quarter of growth in the period and we feel confident in our ability to meet or exceed our full year revenue guidance for IFC.

Vivek K. Jayaraman: During the quarter, we hosted a scientific advisory board meeting for IFC and the uptick in customer experience with an enthusiasm for the product with notable we.

Vivek K. Jayaraman: We are beginning to see clear examples of peer-to-peer marketing at ISC, which is an effective tool for new product marketing. During the quarter, we continued our strong push at clinical conferences and saw an increase in lead generation and physician attendance at our symposiums. As noted in prior calls, we are actively partnering with several large blood centers to enable them to offer IFE directly to their hospital customers, and we experienced a noted step-up in orders via blood.

Vivek K. Jayaraman: We are beginning to see are clear examples of peer to peer marketing on IFC, which is an effective tool for new product adoption.

Vivek K. Jayaraman: During the quarter, we continued our strong push at clinical conferences and saw an increase in lead generation and physician attendance at our symposia.

Vivek K. Jayaraman: As noted in prior calls we are actively partnering with several large blood centers to enable them to offer IFC directly to their hospital customers and we experienced the noted step up in order to be at the Blood Center channel.

Vivek K. Jayaraman: This is serving as a strong complement to our direct sales team, who are now fully trained and are starting to see their hospital targets convert into ordering. Most importantly, we continue to receive strong clinical support for the utility of IFC and for the patient benefit associated with earlier access to fibrinogen. I look forward to providing more updates on our progress with ISC, as well as our global commercial progress overall, during pre-trial. I will now turn the call over to Kevin to review our financials.

Vivek K. Jayaraman: This is serving as a strong complement to our direct sales team who are now fully trained and are starting to see their hospital targets convert into ordering customers.

Kevin: Most importantly, we continue to receive strong clinical support for the utility biopsy and for the patient benefit associated with earlier access to fibrinogen.

Kevin: Look forward to providing more updates on our progress with IFC as long as our global commercial progress overall during future calls.

Vivek K. Jayaraman: I will now turn the call over to Kevin to review our financial results.

Kevin: Thanks Avi.

Kevin D. Green: Vivek, good afternoon, and thank you all for joining us today. On today's call, I'll be discussing our financial results for the first quarter of 2024, highlighting the progress we made on the top line, the bottom line, and the balance. I'll also be providing some commentary on our positive financial outlook for the rest of the year. To start, we posted product revenue of $38.4 million for the first quarter of 2025. This represents year-over-year growth of 24 percent, demonstrative of strong underlying growth in the business and ahead of our Q1 guidance provided back in January.

Kevin: Good afternoon, and thank you all for joining us today.

Kevin D. Green: On today's call I'll be discussing our financial results for the first quarter of 2024.

Kevin D. Green: The progress we made on the topline.

Kevin D. Green: Bottom line in the balance sheet.

Kevin D. Green: I'll also be providing some commentary on our positive financial outlook for the rest of the year.

Kevin D. Green: To start we posted product revenue of $38 4 million for the first quarter of 2024.

Kevin D. Green: This represents year over year growth of 24%.

Kevin D. Green: Demonstrative of strong underlying growth in the business and ahead of our Q1 guidance provided back in January.

Kevin D. Green: North American platelet sales were the major contributor to our product revenue growth during the quarter.

Kevin D. Green: North American platelet sales were the major contributor to our product revenue growth during the quarter. In the U.S., first quarter 2024 product revenues exceeded prior year levels by more than 40%. As we anticipated, sales in Canada to Canadian Blood Services were also extremely strong and are now approaching nearly 100% adoption across their entire platelet production operation.

Kevin D. Green: In the U S first quarter 2020 for product revenues exceeded prior year levels by more than 40%.

Kevin D. Green: As we anticipated sales in Canada to Canadian Blood services were also extremely strong.

Kevin D. Green: Now approaching nearly 100% adoption across their entire fleet with production operation.

Kevin D. Green: In EMEA first quarter product revenues were down 9% year over year, and 8% compared to the fourth quarter of 2023.

Kevin D. Green: In Amia, first quarter product revenues were down 9% year over year and 8% compared to the fourth quarter of 2023. Certain delays in timing of order fulfillment primarily drove this, which is expected to reverse itself over the succeeding quarter. Year over year, FX rates provided a benefit for the EMEA business of around 1.1%. On a consolidated basis, FX provided a benefit of around 50 basis points when comparing Q1, 2024, to that of the prior year period.

Kevin D. Green: Certain delays in timing of order fulfillment, primarily drove the decline which is expected to reverse itself over the succeeding quarters.

Kevin D. Green: Year over year FX rates provided a benefit for the EMEA business of around one 1%.

Kevin D. Green: On a consolidated basis FX provided a benefit of around 50 basis points, when comparing Q1 2024 to that of the prior year period.

Kevin D. Green: As we mentioned on our last quarterly call, we are providing a quarterly breakout of IFC product revenue.

Kevin D. Green: As we mentioned on our last quarterly call, we are providing a quarterly break-out of IFC product. For Q1, we posted IFC revenue of $1.9 million, driven by increasing contributions from our national sales agreements with large U.S. blood center partners. As mentioned by Vivek, we believe the expanding recognition of IFC's clinical and operational utility will continue to drive growth going forward. In addition to our product revenue, and not included in our guidance, government contract revenue totaled $5 million in Q1, compared to $7.5 million for the prior year. The completion of our U.S.

Kevin D. Green: For Q1, we posted IFC revenue of $1 9 million driven by increasing contributions from our national sales agreements with large U S Blood Center partners.

Kevin D. Green: As mentioned by the way, we believe the expanding recognition the ifc's clinical and operational utility will continue to drive the growth going forward.

Kevin D. Green: In addition to our product revenue and not included in our guidance government contract revenue totaled $5 billion in Q1 compared to $7 5 million for the prior year period.

Kevin D. Green: The phase III recipe clinical trial was the primary driver for the decline. We expect this factor will result in government contract revenue remaining near Q1 levels until such time as our Turkish site begins enrollment for the Redis trial. To remind you, included in our government contract revenue are revenues recognized as reimbursement under our contract with BARDA, our agreement with the FDA to further whole blood pathogen reduction, and our milestone-based agreement with the U.S. Department of Defense for liothilized IFC.

Kevin D. Green: The completion of our U S phase III recipe clinical trial was the primary driver for the decline.

Kevin D. Green: We expect this factor will result in government contract revenue remaining near Q1 levels until such time as our Turkish site begins enrollment for the <unk> trial.

Kevin D. Green: To remind you included in our government contract revenue or the revenue is recognized as reimbursement under our contract with BARDA.

Kevin D. Green: Our agreement with the FDA to further whole blood pathogen reduction and there are milestone based agreement with the U S Department of defense for Lyophilize IFC.

Kevin D. Green: Let's now turn to our product gross profit and gross margins.

Kevin D. Green: Let's now turn to our Product Gross Profit and Gross Margin. Our first quarter product gross profit was $21.3 million compared to $17.3 million during the prior year period, an increase of 23% year-over-year. Product List Margins for the first quarter were 55.4%, relatively stable when compared to the prior year in Q4 2023. These results were consistent with our previously announced expectations, and we continue to believe that we will achieve relative consistency in our gross margin.

Kevin D. Green: For first quarter product gross profit was $21 3 million.

Kevin D. Green: Compared to $17 3 million during the prior year period.

Kevin D. Green: An increase of 23% year over year.

Kevin D. Green: Product gross margins for the first quarter were 55, 4%.

Kevin D. Green: Relatively stable when compared to the prior year in Q4 2023.

Kevin D. Green: These results were consistent with our previously announced expectations and we continue to believe that we will achieve relative consistency in our gross margins this year.

Kevin D. Green: Moving on our first quarter operating expenses, which totaled $34 $3 million were $4 $6 million lower than the prior year period of $38 9 million a year over year decline to 12%.

Kevin D. Green: Moving on, our first quarter operating expenses, which totaled $34.3 million, were $4.6 million lower than the prior year period of $38.9 million, a year-over-year decline of 12%. Q1 2024 operating expenses included $5.9 million in non-cash, stock-based compensation. By specific expense type, first quarter R&D expenses totaled $14.5 million compared to $17.4 million during the prior year period. The 17% decline was driven primarily by the completion of the recipe clinical trial and the effects of the restructuring implemented in June of last year.

Kevin D. Green: Q1, 2024 operating expenses included $5 9 million in noncash stock based compensation.

Kevin D. Green: By specific expense targets first.

Kevin D. Green: First quarter R&D expenses totaled $14 $5 million.

Kevin D. Green: <unk> to $17 4 million during the prior year period.

Kevin D. Green: The 17% decline was driven primarily by the completion of the recipe clinical trial and the effects of the restructuring implemented in June of last year.

Kevin D. Green: First quarter SG&A expenses were $19 8 million <unk>.

Kevin D. Green: First quarter SG&A expenses were $19.8 million compared to $21.6 million during the prior year period, the decline, again, driven by last year's restructuring. We believe this level of SG&A expense is sustainable for the remainder of 2024 and will allow us to drive our expected growth and to deliver against our revenue expectations. Let's now focus on the bottom line and non-gap adjusted EBITDA. On the bottom line, the reported net loss attributable to Cerus for the three months ended March 31st, 2024, improved significantly when compared to the same period in the prior year.

Kevin D. Green: Compared to $21 6 million during the prior year period.

Kevin D. Green: The decline again, driven by last year's restructuring.

Kevin D. Green: We believe this level of SG&A expense is sustainable for the remainder of 2024 and will allow us to drive our expected growth and to deliver against our revenue expectations.

Kevin D. Green: Let's now focus on the bottom line non-GAAP adjusted EBITDA results.

Kevin D. Green: On the bottom line reported net loss attributable to <unk> for the three months ended March 31, 2024 improved significantly when compared to the same period in the prior year.

Kevin D. Green: Net loss attributable to <unk> for Q1 narrowed by 38% to $90 7 million or <unk> <unk> per diluted share compared to $15 $6 million were <unk> <unk> per diluted share for the prior year period.

Kevin D. Green: Net loss attributable to Cerus for Q1 narrowed by 38% to $9.7 million or $0.05 per diluted share compared to $15.6 million or $0.09 per diluted share for the prior year period, on a non-gap adjusted EBITDA basis. Q1 2024 generated a much narrower loss of $2.7 million compared to a loss of $9.8 million for the prior year period, as we look ahead to the We expect that as we deliver the top-line growth in our guidance and maintain stable gross margins and operating expenses.

Kevin D. Green: On a non-GAAP adjusted EBITDA basis, Q1, 2024 generated a much narrower loss of $2 $7 million.

Kevin D. Green: Impaired to a loss of $9 8 million for the prior year period.

Kevin D. Green: As we look ahead to the balance of the year.

Kevin D. Green: We expect that as we deliver the top line growth in our guidance.

Kevin D. Green: And maintain stable gross margins and operating expenses, we expect to achieve at least breakeven non-GAAP adjusted EBITDA for 2024 as a whole.

Kevin D. Green: We expect to achieve at least break-even non-gap adjusted EBITDA for 2024 as a whole, on the balance sheet and associated cash flows. We ended the first quarter with a cash position of $72.2 million of cash, cash equivalents, and short-term investments on the balance sheet. Importantly, as we previously announced, was a possibility, we generated positive operating cash flows of $2 million for the first quarter, compared to cash used from operations of $8.5 million during the prior year.

Kevin D. Green: On the balance sheet and associated cash flows.

Kevin D. Green: We ended the first quarter with a cash position of $72 2 million of cash cash equivalents and short term investments on the balance sheet.

Kevin D. Green: Importantly, as we previously announced was a possibility we generated positive operating cash flows of $2 million for the first quarter.

Kevin D. Green: Compared to cash used from operations of $8 5 million during the prior year period.

Kevin D. Green: With our expected top line growth and anticipated declining inventory levels for the remainder of 2024, we continue to believe that with some possible quarterly fluctuations, we can potentially generate positive operating cash flows for 2024 as a whole.

Kevin D. Green: With our expected top line growth and anticipated declining inventory levels for the remainder of 2024, we continue to believe that with some possible quarterly, we can potentially generate positive operating cash flows for 2024 as a whole. Turning now to our guidance. As Obi mentioned, we are increasingly confident in our growth expectations, and as such, we are reiterating our full-year 2024 product revenue guidance in the range of $172 million to $175 million, reflecting double-digit growth from last, As we stated previously, We anticipate this growth to be fueled by the continued expansion of the Intercept platelet business, both in North America and in Europe, as well as continued uptake of IFC in the U.S. We are also reiterating our full year 2024 revenue guidance for IFC, which we continue to expect to be in the range of $8 to $10 million, representing growth of roughly 25 to 50% for 2023 IFCS, I'd now like to turn the call back over to Obi for some closing remarks.

Obi: Turning now to our guidance.

Kevin D. Green: As Obi mentioned, we are increasingly confident in our growth expectations and as such we are reiterating our full year 2020 for product revenue guidance in the range of 172 million to $175 million.

Obi: Reflecting double digit growth from last year.

Obi: As we stated previously.

Obi: We anticipate this growth to be fueled by the continued expansion of the intercept platelet business, both in North America and in Europe.

Obi: As well as continued uptake of IFC and the U S.

Obi: We are also reiterating our full year 2020 for revenue guidance for IFC, which we continue to expect to be in the range of $8 million to $10 million representing growth of roughly 25% to 50% for 2023 IFC sales.

Kevin D. Green: I would now like to turn the call back over to Obi for some closing remarks.

Obi: Thank you Kevin we are pleased with our momentum from the start of 2024, and we would expect to see is carried through the rest of the year.

William M. Greenman: Thank you, Kevin. We are pleased with our momentum from the start of 2024, and we expect to see it carried through the rest of the year. The company is making strong progress towards its commercial, pipeline, and financial goals, allowing us to expand the access to and applicability of the Intercept LED system on a global basis. Thank you for your continued interest in Sirius. I will now turn the call over to the operator for questions.

William M. Greenman: The company is making strong progress towards our commercial pipeline and financial goals, allowing us to expand the access to and applicability of the intercept blood system on a global basis. Thank.

William M. Greenman: Thank you for your continued interest in serious I will now turn the call over to the operator for questions.

Speaker Change: Thank you as a reminder to ask a question. Please press star one on your telephone and wait for your name to be announced to withdraw. Your question. Please press star one again, one moment for questions.

Operator: Thank you. As a reminder, to ask a question, please press star 1-1 on your telephone and wait for your name to be announced. To withdraw your question, please press star 1-1 again. One moment for questions. Our first question comes from Joshua Jennings with TD Common. You may proceed.

Operator: Yes.

Operator: Our first question comes from Joshua Jennings with TD Cowen You May proceed.

Operator: Hi, This is Eric on for Josh Thanks for taking the question.

Joshua Thomas Jennings: Hi, this is Eric on behalf of Josh. Thanks for taking the question. Wanted to just start with guidance. Appreciate the commentary that you provided there for 2024. I was hoping to just hear a little bit more about the cadence of revenue growth that you expect to deliver through the remainder of this year.

Joshua Thomas Jennings: I wanted to just start with guidance appreciate the commentary that you provided there for 2024.

Joshua Thomas Jennings: I was hoping to just hear a little bit more about the cadence of revenue growth that you expect to deliver through the remainder of this year.

Speaker Change: Yes, Thanks, a lot Eric.

Vivek K. Jayaraman: Yeah, thanks a lot, Eric. Vivek, would you like to take that question?

Vivek: Would you like to take that question.

Vivek: Sure I'd be happy to.

Vivek K. Jayaraman: Sure, I'd be happy to. You know, we were pleased with the performance in Q1. As you'll note, you probably recall, Q1 of 2023 was sort of artificially low given some one-time issues that we were dealing with with respect to dating and then also some issues internationally. So, we anticipated a fairly solid bounce back in Q1, but as our full year guidance suggests, we fully believe in our ability to deliver double-digit growth throughout the balance of the year.

Vivek K. Jayaraman: We were pleased with the performance in Q1 as you'll note, you'll probably recall Q1 of 2023 sort of artificially low given some one time issues that we were dealing with with respect to dating and then also some issues internationally. So we anticipated a fairly solid bounce back in Q1, but as our full year guidance.

Vivek K. Jayaraman: Yes.

Vivek K. Jayaraman: Fully in our ability to deliver double digit growth throughout the balance of the year and so Q1 build from.

Vivek K. Jayaraman: And so, Q1, both from a core product line standpoint, as well as from our ISP franchise, were solid results, and we anticipate continuing to deliver that sort of growth, at least in the double-digit percentage range throughout the balance of 2024. So, that's currently our outlook for the year.

Vivek K. Jayaraman: Core product line 10 standpoint, as well as our Iot franchise for solid results and we anticipate continuing to deliver that sort of growth at.

Vivek K. Jayaraman: At least in the double digit percentage throughout the balance of 2024 so.

Vivek K. Jayaraman: That's currently are out for the year.

Speaker Change: That's great. Thank you and then on the shelf life extension I know it was only March that you received the 12 month shelf life approval.

Joshua Thomas Jennings: That's great, thank you. And then on the shelf life extension, I know it was only March that you received that 12 month shelf life approval, but have you and your customers already started to see some of the benefits of that extended life? Or is that something that might take a few quarters to have a real impact here?

Joshua Thomas Jennings: But have you and your customers already starting to see some of the benefits of the extended life or is that something that might take a few quarters to have a real impact here.

Vivek K. Jayaraman: Thanks again for the question, Eric, and Vivek, I think it's right up your alley to take as well.

Speaker Change: Yes, Thanks, Ken for the question Eric.

Speaker Change: I think that's right up your alley to take as well.

Vivek K. Jayaraman: Sure. Yeah, I'd be happy to.

Vivek: Yes, I'd be happy to.

Vivek: There as you probably are aware there is a little bit of time involved in terms of being able to flow those changes through our manufacturing process and get that new product out we are able to.

Vivek K. Jayaraman: You know, there's a little bit of time involved in terms of being able to flow those changes through our manufacturing process and get that new product out. But we are able to utilize that dating for products that are already in the field, so that relieves some of the pressure on our supply chain, mitigates some of the risks of product obsolescence on customer shelves, so that's certainly a benefit.

Vivek K. Jayaraman: We utilize that data for product that's already in the field. So that relieves some of the pressure on our supply chain and mitigate some of the risks the risk of product obsoleting on customer shelves. So that's certainly a benefit but as I indicated earlier.

Vivek K. Jayaraman: But as I indicated earlier, you know, our current forecast doesn't assume a material rebuild of inventory at a customer level. Certainly, as customers get accustomed to longer shelf life, they may feel like they want to rebuild their inventory levels and hold more product at their location. But I think the relief on the supply chain and sort of avoidance of any acute obsolescence issues is something that certainly benefits customers, and we've heard positive feedback about that.

Vivek K. Jayaraman: Our current forecast doesn't assume a material a rebuild of inventory at the customer level certainly.

Vivek K. Jayaraman: Customers.

Vivek K. Jayaraman: On a constant longer shelf life, they may feel like they want to rebuild their inventory levels and hold more product.

Vivek K. Jayaraman: Their locations, but.

Vivek K. Jayaraman: I think the relief on the supply chain and sort of went into many acute obsolescence issue is that something thats certainly benefited customers and we've heard positive feedback about that.

Speaker Change: That's great that makes sense. Thank you for the questions.

Joshua Thomas Jennings: That's great. That makes sense. Thank you for the question.

Speaker Change: Okay. Thanks, a lot.

Speaker Change: Thank you.

Operator: One moment for questions. Our next question comes from Matt Blackman with Stiefel. You may proceed.

Joshua Thomas Jennings: One moment for questions.

Operator: Our next question comes from Matt Blackman with Stifel. You May proceed.

Mathew Justin Blackman: Hi, this is Emily. I'm for Matt.

Operator: Hi, This is Emily on for Matt.

Emily: Just a couple of questions from me on the international business. The weakness there just if you could give any additional color. If it was certain markets or related to any of the geopolitical things that are happening just a little bit more color. There if you could.

Emily: Yes, Thanks, a lot I think.

Mathew Justin Blackman: Just a couple of questions for me on international business, the weakness there. Just if you could give any additional color, if it was certain markets or related to any of the geopolitical things that are happening, just a little bit more color there, if you could.

Speaker Change: Kevin has some thoughts on that.

Mathew Justin Blackman: I think.

Speaker Change: It really is as we mentioned in the prepared remarks more of a timing issue than anything I don't think theres any fundamental weakness in the overseas market in fact.

Mathew Justin Blackman: As we indicated in the prepared remarks, we expect that it will rebound.

Mathew Justin Blackman: Do you go after these timing issues in order patterns for the balance of the year, we expect growth coming out of EMEA as well as the U S.

Mathew Justin Blackman: So.

Speaker Change: It sometimes happens with distributor orders or other factors, where there is a timing issue and I think that's what was at play here.

Mathew Justin Blackman: Yes.

Speaker Change: Okay, great. Thanks.

Mathew Justin Blackman: And then if you could just give us an update on the regulatory progress in China at this time.

Kevin D. Green: Yeah, thanks a lot, Emily. I think Kevin has some thoughts on that.

Speaker Change: Yes, thanks, Emily So we have the planet file under review by the MTA.

Kevin D. Green: Yeah, I think, you know, it really is, as we mentioned in the prepared remarks, more of a timing issue than anything. I don't think there's any fundamental weakness in the overseas market. In fact, as we indicated in the prepared remarks, we expect that it will rebound after these timing issues and order patterns for the balance of the year, and we expect growth coming out of EMEA as well. So, you know, it sometimes happens with distributor orders or other factors where there's a timing issue, and I think that's what goes into play here.

Kevin D. Green: There are obviously a lot of Chinese holidays over the last couple of months. So we're still awaiting any additional questions that they may have we expect those questions.

Kevin D. Green: The second quarter here.

Kevin D. Green: And then with those questions will be able to provide a lot more clarity around the likely timing for an approval.

Speaker Change: Okay, great. Thank you very much.

Mathew Justin Blackman: Okay, great. Thanks. And then, if you could just give us an update on the regulatory progress in China at this time, yeah.

Mathew Justin Blackman: Yeah, thanks, Emily. So we have the planet file under review by the NPA. There have obviously been a lot of Chinese holidays over the last couple of months, so we're still awaiting any additional questions that they may have. We expect those questions in the second quarter here. And then with those questions, we'll be able to provide a lot more clarity around the likely timing for an approval.

Speaker Change: Thanks very much.

Speaker Change: Thank you.

Mathew Justin Blackman: One moment for questions.

Mathew Justin Blackman: Our next question comes from Jacob Johnson with Stephens You May proceed.

Speaker Change: Hey, thanks good.

Mathew Justin Blackman: Okay, great. Thank you very much. Yeah, thanks very much.

Speaker Change: Good afternoon everybody.

Mathew Justin Blackman: Yeah, thanks very much, Emily.

Mathew Justin Blackman: Maybe for <unk> or for.

Mathew Justin Blackman: Kevin on guidance I heard you.

Mathew Justin Blackman: Just say kind of double digit growth for the balance of the year run.

Operator: One moment for questions. Our next question comes from Jacob Johnson.

Speaker Change: And that is true my excel spreadsheet I get something towards the higher end of the guidance you said in the release increased increasingly confident in the guidance. This year I understand we're just a quarter end, but fair to say kind of expectations now versus the beginning of the year youre trending maybe towards the higher end of the guidance.

Jacob K. Johnson: Hey, thanks. Good afternoon, everybody.

Jacob K. Johnson: I don't know, maybe for Obi or for Kevin on guidance. I heard Vivek just say kind of double-digit growth for the balance of the year. If I run that through my Excel spreadsheet, I get something towards the higher end of the guidance. Obi, you said in the release, are increasingly confident in the guidance this year. I understand we're just a quarter in, but fair to say what kind of expectations now versus the beginning of the year; you're trending maybe towards the higher end of the guidance.

Jacob K. Johnson: And Kevin maybe any words of caution from from our CFO.

Jacob K. Johnson: And Kevin, maybe any words of caution from a CFO? You gave me a little kick in the table, but yeah, I think we're very optimistic about the growth trajectory for the year. We'd like to sort of get Q2 under our belts just to see, you know, how things play out. As Vivek mentioned as well, there's really not a lot factored in at the moment for the extension of the shelf life and any kind of restocking opportunities. So, that's sort of the logic behind maintaining guidance at this time.

Jacob K. Johnson: On the table, but I think we're very optimistic about the growth trajectory for the year.

Jacob K. Johnson: We'd like to sort of get Q2 under our belt just to see how things play out.

Jacob K. Johnson: I've mentioned as well there is really not a lot factored in at the moment for the extension of the shelf life and any kind of restocking opportunities.

Jacob K. Johnson: So that's sort of the logic behind maintenance of guidance at this time.

William M. Greenman: Yeah, I mean, from my perspective, Jacob, I think that's absolutely right. We don't know what effects rates are going to have, so there's potential downside from that. But I think fundamentally, we are more confident as we sit here today than we were in January when we provided the initial guidance, and as things unfold, we'll be in a better position to provide updates.

Kevin: Yes, I mean from my perspective, I think that's absolutely right.

William M. Greenman: Don't know what FX rates are going to do so theres potential downside from that but I think fundamentally.

William M. Greenman: We are more confident as we sit here today than we were in January when we provided initial guidance and as things unfold, we'll be in a better position to provide up to hcl.

Speaker Change: Got it.

Kevin D. Green: Yeah, I just figured I had to try. Thanks guys. And then maybe for Vivek, just on the IFC growth, it sounds like maybe some traction with some of the blood, larger blood centers you've partnered with, but I'm just kind of curious on the IFC side of things, kind of trends.

Speaker Change: Sorry, I had to try thanks, guys and then maybe.

Speaker Change: Just on the ISP growth.

Vivek: It sounds like maybe some traction with some of the blood larger blood centers, you've partnered with I am just kind of curious on the IFC.

Vivek: Side of things kind of trends on those blood centers, you've partnered with nurses.

Vivek: Some of the manufacturing partners you have on the ISG side of things.

Jacob K. Johnson: Yeah, happy to address that. Thanks for the question.

Vivek: Yes, you did address that thanks for the question, if I think about our ISP business.

Vivek: And I think as we stated earlier coming out of Q1, we feel even more confident about our ability to deliver against the annual guidance and see strong growth in that franchise and they are really a few reasons.

Vivek K. Jayaraman: You know, if I think about our ISB business... And I think, as we stated earlier, coming out of Q1, we feel even more confident about our ability to deliver against the annual guidance and see strong growth in that franchise. And there are really a few reasons for our sort of increased. The first, we announced late last year that we had formed partnerships with large blood centers for them to distribute IFC directly to their hospital customers.

Vivek K. Jayaraman: For our sort of increased confidence.

Vivek K. Jayaraman: First we announced late last year that we had formed partnerships with large blood centers for them to distribute IFC directly to.

Vivek K. Jayaraman: Their hospital customers and in Q1, we saw a material step up in terms of blood center customers, who are ordering IFC directly to that channel.

Vivek K. Jayaraman: And in Q1, we saw a material step up in terms of blood center customers who are ordering IFC directly through that channel. Good initial validation of the strength of that channel and our ability to broaden access to IFC. The second area of encouragement for us was the account that we opened up in late 2023. We saw a pretty significant increase in youth ad accounts, the sort of same-store sales. You know, we may have entered initially and through one clinical department, perhaps it was high-risk OB or trauma. And what we saw was a broadening out across that institution of the availability of IFC as the clinicians started to engage with one another. And they sort of saw firsthand the benefit of having that product available.

Vivek K. Jayaraman: Good initial validation of the strength of that channel and our ability to broaden access to IFC.

Vivek K. Jayaraman: For the area.

Vivek K. Jayaraman: <unk> for US was in the account that we had opened up in late 2023, we saw a pretty significant increase in used and accounts and sort of same store sales. We may have entered initially in through one clinical department, perhaps it was high risk of ear trauma and with what we saw was a broadening out across that.

Vivek K. Jayaraman: Institution.

Vivek K. Jayaraman: Availability of IFC as the clinicians start to engage with one another and they sort of saw firsthand the benefit of having that product available. So that that's encouraging because it shows that not only can we get access to more hospitals, but once we get in we have the ability to go deeper within those accounts and then and then lastly with our.

Vivek K. Jayaraman: So that's actually encouraging, too, because it shows us not only can we get access to more hospitals, but once we get in, we have the ability to go deeper within those accounts. And then, and then lastly, with our reference, we have sufficient manufacturing capacity in 2024 to meet or exceed our guidance. So what we're doing is we're working actively to increase capacity because we want to make sure that as we generate demand, we have supply available to meet it.

Vivek K. Jayaraman: <unk> partners with you referenced we.

Vivek K. Jayaraman: Have sufficient manufacturing capacity in 2024 to meet or exceed our guidance that we're doing is we're working actively to increase capacity because we want to make sure that as we generate demand we have.

Vivek K. Jayaraman: Supply available to meet it so.

Vivek K. Jayaraman: So, you know, similar to what Kevin said about overall product guidance for 2024, specifically the ISC guidance for the calendar year, we feel much better about things here in early May than we did back in January when we issued that guidance. So that's certainly progress.

Vivek K. Jayaraman: Similar to what Kevin said about overall product guidance for 2024, specifically to the guidance for the calendar year.

Vivek K. Jayaraman: We feel much better about things here in early May and we did back in January when we issued that guidance and so that's certainly a positive progress.

Speaker Change: Got it that's helpful and if I could just sneak in one more.

Jacob K. Johnson: Got it, that's helpful. And if I could just sneak in one more, sorry to keep you on the hot seat, Vivek, but on the Middle East opportunity, it sounds like there's an opportunity in that region. I'm just kind of curious, um, are there any areas you need to invest in, or are there any kind of hoops you need to jump through to kind of better realize that opportunity as we start thinking about that?

Vivek K. Jayaraman: Yeah, a great question. Thanks.

Vivek K. Jayaraman: Sorry to keep you on the hot seat Vivek, but just on the middle East opportunity.

Vivek: It sounds like there is an opportunity in that region I'm just kind of curious.

Vivek K. Jayaraman: Are there any areas you need to invest or are there any kind of hoops, you need to john's periods to kind of better better realize that opportunity as we start thinking about that.

Vivek K. Jayaraman: But, you know, as I mentioned, I had the opportunity to spend some time in the region at the annual Med Lab conference, which is held in Dubai. And, you know, candidly, the most challenging hoops to jump through are ones that we've already cleared, and that's getting both FDA approval and MDR clearance. I'm sure you hear a lot about the onerous nature of the MDD to MDR transition and the fact that we have, you know, achieved that milestone in addition to the fact that we're the only path to reduce technology that has FBA approval.

Vivek: Yes, great question. Thanks, as I mentioned on the opportunity to spend some time in the region at the annual <unk> Conference, which was held in Dubai and.

Vivek K. Jayaraman: Candidly the.

Vivek K. Jayaraman: Most challenging hoops to jump through are ones that we've already cleared in that.

Vivek K. Jayaraman: Receiving both FDA approval and MBR clearance I'm sure you hear a lot about the.

Vivek K. Jayaraman: Under its nature of the <unk> MBR transition and the fact that we have.

Vivek K. Jayaraman: Achieved that milestone in addition to the fact that we're the only a pathogen reduced technology that had an FDA approval that really resonates with customers.

Vivek K. Jayaraman: That really resonates with customers in that region. They tend to take their cues from the AABB and look to the U.S. in terms of technology adoption. So that's sort of the major driver of the community and market interest there. It also is tied to an overall, you know, as you're probably aware of, investment strategy in Saudi Arabia in particular, sort of a defined runway in terms of their economy driven by being driven by natural resources.

Vivek K. Jayaraman: In that region, they tend to take their cues from the ABB and look to the U S. In terms of technology adoption. So thats.

Vivek K. Jayaraman: The major driver of.

Vivek K. Jayaraman: The community and market interest there and also tied to an overall.

Vivek K. Jayaraman: As Youre, probably aware of investment strategy in Saudi in particular, where they recognize there is a.

Vivek K. Jayaraman: Sort of a defined runway in terms of their economy, driven by being Vin by natural resources. So they are investing in healthcare they are investing in entertainment and in the rest. So theres a big pushed invest in health care and there is a view to what technologies are approved in the U S and MBR cleared as things that they want to bring in locally and so those are some of the facts.

Vivek K. Jayaraman: So they're investing in health care, they're investing in entertainment, and the rest. So there's a big push to invest in health care, and there's a view to what technologies are approved in the U.S., and NBR is clear to think that they want to bring in locally. And so those are some of the factors that accrue to our benefit when we think about growth in that region.

Vivek K. Jayaraman: Does that accrue to our benefit when we think about growth in that region.

Speaker Change: Got it I'll leave it there thanks for taking the questions.

Jacob K. Johnson: Got it. I'll leave it there.

Operator: Thanks for taking the questions. Thanks a lot, Jacob. Thank you. One moment for questions.

Speaker Change: Thanks, a lot Jacob.

Speaker Change: Thank you.

Operator: Thank you. One moment for questions. Our next question comes from Ross Osborn with Cantor Fitzgerald. You may proceed.

Speaker Change: One moment for questions.

Operator: Our next question comes from Ross Osborne with Cantor Fitzgerald you May proceed.

Ross Osborn: Thanks, Ross. I think your voice sort of broke up a little bit on our end, so I think your question was around reimbursement for IFC and the evolution there linked to the NTAP. Is that correct? Yes, that's correct. Okay, great. Thanks, Ross. Vivek, sorry to put you on the hot seat again, but could you...

Speaker Change: Hey, guys congrats on the progress and thanks for taking my questions.

Ross Osborn: So starting off with can you discuss how reimbursement has gone with IFC in terms of accounts being able to receive it.

Speaker Change: Thanks, Ross So I think Youre your voice broke up a little bit at least on our end. So I think your question was around reimbursement for IFC and the evolution there linked to the zero correct, Yes, Thats correct, okay, great. Thanks Ross.

Vivek: Sorry to see it again, but could you address that.

Ross Osborn: Sorry, I can't hear the question. He broke up a little bit.

Speaker Change: Sorry I.

Speaker Change: I can take the question that he broke up a little.

Vivek K. Jayaraman: Yeah, it's basically around how the reimbursement evolution for IFC has occurred and in the context of the NTAP. So, really, how does IFC reimbursement take place at the hospital level? [inaudible] It is a really good analysis, and the reason it's really true is because of the fact that it's a work in progress. It did initially allow us to get the NTEP designation as it created more awareness and interest from clinicians. But fundamentally, you know, it's the way in which products are paid for is through the, depending upon the case, is through the associated DRG.

Vivek: It was basically around how the reimbursement evolution for ISC has.

Vivek K. Jayaraman: Occurred in the context of the untapped so really how does IFC reimbursement take place at the hospital level.

Vivek K. Jayaraman: Okay.

Vivek K. Jayaraman: Yes.

Vivek K. Jayaraman: Yes.

Vivek K. Jayaraman: Okay.

Vivek K. Jayaraman: Im going.

Vivek K. Jayaraman: Is it really.

Vivek K. Jayaraman: Sure.

Vivek K. Jayaraman: Magnus did allow us to do initially getting the NSF designation as it created more awareness and interest from clinicians but fundamentally.

Vivek K. Jayaraman: The way in which products paid for us through the depending upon the case through the associated DRG. So.

Vivek K. Jayaraman: So we've been able to see, which has been encouraging, is that initially, we thought we'd get quite a bit of pushback on price and cost. And once we get through the value added, you know, the value analysis committees, or in the case of leveraging the blood center relationships with the hospital and going through that channel, we've actually seen much less pushback on price than we'd anticipated. So, you know, we're going to have to track that on an ongoing basis, continue to improve the clinical utility, but that hasn't been a problem.

Vivek K. Jayaraman: What we've been able to see which has been encouraging as initially we thought we'd get quite a bit of pushback.

Vivek K. Jayaraman: Pushback on price and cost and once we get through the value add that.

Vivek K. Jayaraman: The value analysis committees or in the case of leveraging the blood center relationship with the hospital and selling through that channel.

Vivek K. Jayaraman: We've actually seen much less pushback on price than we had anticipated. So we're going to have to track down at an on an ongoing basis. So we have to continue to improve the clinical utility but.

Vivek K. Jayaraman: That hasnt been a governor in terms of getting new.

Vivek K. Jayaraman: Accounts on board, it's really been just getting through the process of getting new products into an institution that we're selling directly and then getting the blood center channel up and trained for going through that.

Vivek K. Jayaraman: If we are going through that channel partner.

Vivek K. Jayaraman: Yeah, I'd add that the value proposition around the timely availability of the product to the patient really seems to resonate over time, as does the dramatic reduction in wastage that we're seeing at the hospitals that have taken on IFC. Great, thank you.

Vivek K. Jayaraman: Yes.

Vivek K. Jayaraman: The value proposition around the timely availability of the product to the patient really seems to resonate overtime as does the dramatic reduction in ways that were seeing the hospitals are taking on IFC.

Speaker Change: Great. Thank you and then lastly in looking at the smaller geographies, but those that could provide some upside but you can you discuss the state of the UK and Germany.

Vivek K. Jayaraman: And then lastly, and looking at smaller geographies, for those that could provide some upside, would you discuss the state of the UK and Germany? Yeah, I'll start there, and maybe I'll take the UK, and Vivek can take Germany. So the UK, you know, has been, you know, a long story as, you know, a lot of these accounts that are sort of deferring the decision around improving the safety and availability of the blood supply.

Vivek: Yeah, I'll start there and maybe I'll take U K and they can take Germany. So the UK has been a long story.

Vivek K. Jayaraman: A lot of these accounts that are sort of deferring the decision around improving the safety and availability of the blood supply.

Vivek K. Jayaraman: That's an increasingly challenging position to take when so many other countries have established pathogen activation and intercepts specifically as the standard of care and the results that they're seeing from real world experience with the product. The UK is about ready to release a report on blood safety coming from HIV and hepatitis. The epidemics of the 80s and 90s. It's called the Infected Blood Inquiry. That's supposed to be published on May 20th in the UK, and it's estimated that there'll be multi-billion dollar restitutions to the victims.

Vivek K. Jayaraman: It's an increasingly.

Vivek K. Jayaraman: Sort of challenging position to take when so many other countries has established pathogen activation and intercept specifically as the standard of care and the results that they're seeing from real world experience with the product.

Vivek K. Jayaraman: The UK is about ready to release.

Vivek K. Jayaraman: <unk>.

Vivek K. Jayaraman: On.

Vivek K. Jayaraman: Blood safety coming in from the HIV and hepatitis.

Vivek K. Jayaraman: <unk> of the 80 to 90 is called the infected blood inquiry.

Vivek K. Jayaraman: Supposed to be published on May 20th in the U K and it's estimated that there'll be multibillion dollar restitution to the victims.

Vivek K. Jayaraman: So I think that will have some impact on sort of how the UK looks at blood safety and availability going forward. That being said, it's a single-payer system, as you know, and so the National Health Service Blood and Tissue has a fairly formal process for how they would take on pathogenesis.

Vivek K. Jayaraman: So I think that we will have some impact on sort of how is the UK it looks at blood safety and availability going forward.

Vivek K. Jayaraman: That being said, it's a single payer system as you know.

Vivek K. Jayaraman: The National Health service blood and tissue.

Vivek K. Jayaraman: Has a fairly formal process for how they would take on pathogen activation.

Vivek K. Jayaraman: We're optimistic that at some point in time that market will convert it's just hard to predict when.

Vivek K. Jayaraman: Do you mind covering on Germany.

Speaker Change: Sure I'd be happy to.

Vivek K. Jayaraman: Sure, I'd be happy to. For Germany, if you think about the market more similar to the U.S. as opposed to a situation in France where you have a single decision-maker, and once they decide to go, it really becomes about partnering with them from an operations standpoint or on implementation. So we are actively involved in the community in Germany, getting accounts online, working with them to get their MA and ML marketing license approvals, and you know what's been most encouraging is we're starting to get some institutions to start in Berlin.

Vivek K. Jayaraman: For Germany, if you think about the market dynamics that more similar to the U S. As opposed to situation in France, where you have a single decision maker and once they decided to go it really becomes about partnering with them from an operation standpoint around implementation. So we are actively involved in gaming in Germany with.

Vivek K. Jayaraman: Getting accounts online and working with them to get their MAA and ml marketing license approvals.

Vivek K. Jayaraman: What's been most encouraging is we're starting to get some institutions to start brilinta slip up Berlin share their hospital, beginning with pathogen reduction that's one of the top 10, leading hospitals in the world until you get these luminary institution onboard and Thats.

Vivek K. Jayaraman: We spoke about Berlin Charité Hospital beginning with fast reduction. It's one of the top 10 leading hospitals in the world, and so you get these luminary institutions on board, and that's, you know, kind of where we see progress. So the German Red Cross DRK is also one of our other area customers where we're working towards getting them up on fast reduction. One of the things that we'll need to work through is getting an extended day label claim, like a six day claim in the marketplace. But in terms of where we stand now, Germany.

Vivek K. Jayaraman: Where we see progress driving so the German Red Cross drk as all the other customers, where we're working towards getting them up.

Vivek K. Jayaraman: Upon that through.

Vivek K. Jayaraman: The reduction one of the things that we'll need to.

Vivek K. Jayaraman: Through is getting extended day label claim like a six day claim in the marketplace, but.

Vivek K. Jayaraman: In terms of where we stand now Germany continues to be a growth opportunity for us in EMEA, We've got a direct team on the ground there and we're starting to see product adoption. So it's a slower process than some geographies, where you have a single decision maker, but on balance we feel good about our growth prospects for Germany through the balance of the decade.

Speaker Change: Thank you.

Speaker Change: Thanks, very much Ross.

Vivek K. Jayaraman: Thank you and as a reminder to ask a question. Please press star one on your telephone one moment for questions.

Operator: Thank you. And as a reminder, to ask a question, please press star one one on your telephone. One moment for questions. Our next question comes from William Bunnell with Craig Hallam Capital Group. You may proceed.

William M. Greenman: Our next question comes from William <unk> with Craig Hallum Capital Group You May proceed.

William M. Greenman: Good afternoon, guys. Thanks for taking the call.

William M. Greenman: Hey, good afternoon, guys. Thanks for taking the call.

William M. Greenman: <unk>.

William M. Greenman: Obviously, great recovery.

William M. Greenman: You know, obviously, great recovery in North America. Just trying to understand a little bit more about EMEA, you know, outside North America. I understand the quarter and what you said there, but just more generally, I mean, it's been sort of a, you know, a several-year trend of sort of declining revenue. What's the underlying dynamic that's happening there, and how does that change? Do we think that only changes with more countries coming on board? Are you, you know..., pretty much not expecting growth where you already are? Or how do we think about that?

William M. Greenman: In North America, just trying to understand a little bit more about EMEA.

William M. Greenman: Outside North America.

William M. Greenman: I get the quarter and what you said there, but just more generally I mean, it's been sort of.

William M. Greenman: A several year trend of sort of declining revenue.

William M. Greenman: The underlying dynamic that's happening there and how does that change does it only change by by more.

William M. Greenman: Countries coming onboard or are you are you.

William M. Greenman: Pretty much not expecting growth, where you already are or how do we think about that.

Kevin D. Green: Well, I think last year was somewhat of an anomaly in that we traditionally see sort of single-digit or low single-digit organic growth in markets where we have a hundred percent penetration, for example, in France and Belgium, and last year, we don't know if it was a function of sort of COVID or just changing the change in transfusion practices around transfusion thresholds for playlets, but we saw a decline last year in the organic growth That figure has recovered this year, as we mentioned in our prepared remarks.

William M. Greenman: Well I think last year was somewhat of an anomaly in that we traditionally see sort of single digit or low single digit organic growth in markets, where we have 100% penetration for example, in France and Belgium.

Kevin D. Green: Last year, we don't know.

Kevin D. Green: So if it was a function of sort of COVID-19 or are just changing in change in transfusion practices around transfusion thresholds for platelets, but.

Kevin D. Green: But we saw a decline last year in the organic grower.

Kevin D. Green: And the overall platelet demand in those markets recover this year as we mentioned in our prepared remarks.

Kevin D. Green: I think as far as the longer-term growth trajectory is concerned, it really is about new geographies as well as ultimately having some growth in the plasma business, which has been lagging behind playlet adoption. So, yeah, I think we feel pretty confident about the geographic opportunities for us in Europe. And that being said, you know, it's really hard to predict exactly when these large accounts will come online. So I don't know if that answers your question, Bill.

Kevin D. Green: I think as far as longer term growth trajectory. It really is about new geographies as well as ultimately having some growth in the plasma business, which has been.

Kevin D. Green: Lagging the platelet adoption.

Kevin D. Green: I think we feel pretty confident about the geographic opportunities for us in Europe.

Kevin D. Green: And that being said, it's real hard to predict exactly when these large accounts will come online.

Kevin D. Green: Does that answer your question Bill.

William M. Greenman: Yeah, no, absolutely. That's really helpful. And then just on the CE mark, is there anything more you can tell us there? I think you've said, you know, hopeful, expected timing by the end of this year, but just what sort of has to happen between now and then, and any other color you can give us on timing would be great. On red blood cell, obviously.

Kevin D. Green: Absolutely.

William M. Greenman: Really helpful.

William M. Greenman: Then just on <unk>.

William M. Greenman: CE Mark is there anything more you can tell us there I think you've said.

William M. Greenman: Full expected timing by the end of this year, but just what sort of has to happen.

William M. Greenman: Between now and then.

William M. Greenman: And any other color you can give us on timing would be great on a red blood cell obviously.

William M. Greenman: Thanks a lot, Bill. So, your question is specific to CE mark timing under the MDR practice.

Speaker Change: Thanks, a lot, though so your questions.

William M. Greenman: Pacific to CE, Mark timing under the MBR processing.

William M. Greenman: Unfortunately, Carol Moore is on the call with us. I'll turn it over to Carol. She's our Senior Vice President of Regulatory Equality.

William M. Greenman: Should we care more is on the call with us I'll turn it over to Carol She is our senior vice president of regulatory quality. Thank.

Carol Moore: Thank you. Thanks for the question.

Carol M. Moore: Thank you thanks for the question.

Carol M. Moore: We are working closely with our competent authority, which is in the Netherlands to finish up.

Carol Moore: We are working closely with our competent authority, which is in the Netherlands, to finish up any questions they might have on the responses we provided earlier this year. We have not heard back from them, but we did provide a complete response. And between receiving some feedback from our competent authority, we will still go back and talk to our notified body, which is the TUV, and determine what the next steps are towards completing the application. So we'll be in a better position once we hear back from our competent authority about the responses that we provided earlier this year.

Carol Moore: Any questions they might have on the responses we provided earlier this year.

Carol Moore: I have not heard back from them, but we did provide a complete response and between receiving some feedback from our competent authority we still.

Carol Moore: Go back and talk to our notified body, which is the <unk>.

Carol Moore: Determine what the next steps are towards completing the application. So we'll be in a better position once we hear back from our competent authority about the.

Carol Moore: The responses that we provided earlier this year.

William M. Greenman: Okay, and based on what you know thus far, I mean, any change to your thinking and timing?

Speaker Change: Okay and based on what you know, thus far though I mean any change to your thinking on timing well I think we're just in active we're just in an active review process. So it's.

Carol Moore: Well, I think we're just in an active review process, so at times it's hard to predict what might come up next, but I think we're working hard to make sure that we fulfill any requests that we receive in the most timely way.

Carol Moore: At times, it's hard to predict what what might come up next but I think we're working hard to make sure that we fulfill any requests that we receive in the most timely way.

William M. Greenman: Okay, that's helpful, and then just one last question on cash flow. I'm happy to hear your thoughts about potentially being operating cash flow for the year and, obviously, seeing it for Q1. Anything particularly unusual? I think we had, you know, some unusual working capital movements, and Q4 probably hurt operating cash flow. Did we sort of see a reverse of that helping Q1? Or how do we sort of think about it, you know, in the future quarters?

Speaker Change: Okay. That's helpful. And then just one last question on cash flow.

William M. Greenman: Happy to hear your thoughts about potentially being operating cash flow for.

William M. Greenman: For the year, and obviously seeing it for Q1.

William M. Greenman:

William M. Greenman: Just just anything particularly unusual I think we had some unusual working capital moves.

William M. Greenman: Q4, probably that hurt operating cash flow do we sort of see a reverse of that helping Q1 or how do we sort of think about it.

William M. Greenman: In the.

William M. Greenman: In the future quarters.

Kevin D. Green: Yeah, Bill, I'll take that one. So you're right, Q4 actually 2023 at large. We saw kind of atypical working capital movements with increased inventory and rapidly declining payables. I think when we ended the year, we felt like we were in a position where we could reverse that. Q1 was really the first time.

Speaker Change: Yes, Bill I'll take that one.

Speaker Change: So youre right.

Kevin D. Green: Q4, actually 2023 of large.

Kevin D. Green: Kind of atypical working capital movements with increased inventory and rapidly declining payables I think when we ended the year. We felt like we were in a position where we could reverse that Q1 was really the first time I think you see the inventories coming down.

Kevin D. Green: I think that you see the inventories coming down. Obviously, our receivables have come down. For that matter, payables have come down. Um, as you know, I think we're cautiously optimistic for the balance of the year. Obviously, there could be a drop in any given quarter, but you think about our guidance and Q1 being kind of the low watermark for the year. I think we expect to see continued growth in the top

Kevin D. Green: Obviously, our receivables have come down for that amount of payables have come down.

Kevin D. Green: I think we're cautiously optimistic for the balance of the year, obviously, there could be chop in any given quarter, but do you think about our guidance.

Kevin D. Green: Q1 being durable.

Kevin D. Green: The low watermark for the year.

Kevin D. Green: We expect to see continued growth in the topline.

Kevin D. Green: We'll continue to work down inventory levels. And then really, it comes down to managing the payables and the receivables at the current DSO and DPO levels, which we think are manageable. So I think there are a lot of fundamental reasons to be confident that we can generate operating cash flow, and we'll manage toward that.

Kevin D. Green: We will continue to work down inventory levels.

Kevin D. Green: And really it comes down to managing the payables and the receivables at the current.

Kevin D. Green: <unk> and <unk> levels, which we think is manageable. So I think theres a lot of fundamental reasons to be confident that we can generate operating cash flow.

Kevin D. Green: Well manage towards that.

Speaker Change: That's awesome alright, guys. Thank you very much.

William M. Greenman: That's awesome. All right, you guys, thank you very much.

William M. Greenman: Thanks a lot, Bill, for the question.

Speaker Change: Thanks, a lot those are the questions.

William M. Greenman: Thank you I would now like to turn the call back over to Obi Greenman for any closing remarks.

William M. Greenman: Thank you. I would now like to turn the call back over to Obi Greenman for any closing remarks.

William M. Greenman: Well, thank you again for joining us today and for your interest in Cerus. We look forward to keeping you informed of our progress throughout the rest of 2024.

William M. Greenman: Well. Thank you again for joining us today and for your interest in Cerus, we look forward to keeping you informed of our progress throughout the rest of 2024. Thank you.

Operator: Thank you. This concludes the conference. Thank you for your participation. You may now disconnect.

William M. Greenman: Thank you. This concludes the conference. Thank you for your participation you may now disconnect.

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