Q3 2025 Beyond Air Inc Earnings Call
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Speaker Change: Good afternoon and welcome everyone to the BeyondAIR financial results call for the fiscal quarter ended December 31st, 2024.
Speaker Change: At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation.
Speaker Change: And now I'd like to turn the call over to Corey Davis, Lifestyle Advisors. Thank you. You may begin.
Corey Davis: Thank you, operator. Good afternoon, everyone. Thank you for joining us.
Speaker Change: Today, after the market closed, we issued a press release announcing the operational highlights and financial results for Beyond Air's third quarter of fiscal 2025, ended December 31st, 2024. A copy of this press release can be found on our website, beyondair.net, under the News and Events section.
Speaker Change: Beyond Air cautions that these forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those indicated.
Speaker Change: We encourage everyone to review the company's filings with the Securities and Exchange Commission, including, without limitation, the company's most recent Form 10-K and Form 10-Q, which identify specific factors that may cause actual results or events to differ materially from those described in the forward-looking statements.
Speaker Change: Additionally, this conference call is being recorded and will be available for audio rebroadcast on our website www.beyondair.net.
Speaker Change: Furthermore, the content of this conference call contains time-sensitive information and is accurate only as of the date of this live broadcast, February 10th, 2025. Beyond Air undertakes no obligation to revise or update any statements to reflect events or circumstances after the date of this call.
Speaker Change: With that, let me turn the call over to Steve Lisi, Chairman and Chief Executive Officer of Beyond Air. Go ahead, Steve.
Speaker Change: Thanks, Corey. Good afternoon to everyone joining us. With me here today is Doug Larson, our Chief Financial Officer.
Speaker Change: Let's start today's call by stating how pleased we are with the sequential quarterly revenue growth we are seeing as our commercial team continues to make significant progress.
Speaker Change: This has been driven by a steady stream of new hospital signings and going through the onboarding process to begin using our LungFitPH system in their institutions.
Speaker Change: During the quarter, we saw six new hospital starts and two hospitals renew their contracts, one of them for three years.
Speaker Change: There's only been about nine months since our upgraded LungFit PH began shipping and seven months since our new Chief Commercial Officer joined us, which has brought new energy to the entire Beyond Air team. We expect this momentum will continue and drive sequential quarterly revenue growth throughout this year.
Speaker Change: A key factor of our ongoing success is that the BeyondAir team has done a tremendous job of strengthening each stage of the customer engagement process.
Speaker Change: to ensure we are offering the best possible experience for hospital administrators, nurses, physicians, staff, and of course, respiratory therapists.
Speaker Change: Most importantly, our existing customers are providing overwhelmingly positive feedback on the LungFit VH device, which translates to great references for potential new engagements.
Building on our robust customer engagement pipeline.
We now have several partnerships in place.
Speaker Change: supplementing our direct sales team, including Healthcare Links, a renowned healthcare advisory and contracting firm that works with GPOs and IDNs, and Trillimed to help us engage with and distribute to the military and Veterans Administration hospitals.
Speaker Change: Additionally, our marketing efforts have been upgraded significantly, which has provided a meaningful boost to our sales efforts. In addition, our presence and activities at all respiratory conferences are much improved, which you can see if you take a look at all of our social media postings.
Speaker Change: Turning to the PMA supplement for the LungFit pH Label Expansion to include cardiac surgery. The interactive discussion with FDA continues.
Speaker Change: We will continue to provide FDA with the information that they request and provide updates to investors each quarter. As a reminder, no nitric oxide products are currently approved for cardiac surgery in the United States.
Speaker Change: One last point about the U.S. market. We expect our PMA supplement for our next-generation lung-fit pH transport capable system to be ready shortly for submission to FDA.
Speaker Change: Recall that in November, we demonstrated this next generation system at the AARC annual meeting, and the feedback was quite strong, with the most common question being, when can I get this version of lung fit pH in my hospital? We will provide further details on this system on next quarter's earnings call.
Speaker Change: The indications covered under CE mark certification are the treatment of infants with greater than 34 weeks gestation with hypoxic respiratory failure, and the treatment of peri and postoperative pulmonary hypertension in adults and children in conjunction with heart surgery.
Speaker Change: Receiving CE Mark triggered a $1 million milestone payment from Getz Healthcare, our Asia-Pacific distribution partner, which we will receive in the March quarter. Along with royalty payments, we will receive based on lumped PHS.
Speaker Change: Guest is already ahead of schedule securing market authorization in Australia less than two months after receiving CE mark.
Speaker Change: To accelerate XUS sales, we have teamed up with BusinessAsia consultants to provide LungFitPH to hospitals throughout Europe, South America, the Asia-Pacific region, and the Middle East.
Speaker Change: We've already seen progress with extremely high distributor interest, and in fact, we already have two new contracts signed in the Middle East.
Speaker Change: As a reminder, the fact that lung thick pH generates nitric oxide from room air opens up enormous opportunity in areas around the world where hospitals are unable to obtain nitric oxide supply, or do not use nitric oxide due to logistical difficulties associated with cumbersome cylinder based systems.
Overall, we believe that the updated lung fit pH.
Speaker Change: on the U.S. market since the spring of 2024 is poised to start taking significant market share in the U.S. and globally.
Speaker Change: The inflection point is happening now in the U.S. thanks to the system performance and our new and improved commercial infrastructure.
Speaker Change: Globally, we expect to see shipments starting in the next few months which will make an impact on our revenues in the back half of fiscal 2026 and beyond. We will be providing revenue guidance for fiscal 2026 on our fiscal 2025 year end conference call which will be held in June.
Speaker Change: Turning to Beyond Cancer, as Pierce reported, they received regulatory approval to begin a Phase 1b trial for low-volume, ultra-high-concentration nitric oxide, or UNO.
Speaker Change: in combination with anti-PD-1 therapy in late-stage cancer patients who have failed anti-PD-1 therapy, which remains an area of high unmet patient need.
Speaker Change: Top line data from this Phase 1b study are anticipated around the end of calendar 2025.
Speaker Change: The UNO dose will be 25,000 parts per million. We call it low volume now because our original human study utilized one liter of gas, while this phase 1B study will utilize less than 100 milliliters of gas, a reduction of over 90%.
Speaker Change: As everyone knows, the global anti-PD-1 therapy market is in the tens of billions of dollars. I encourage all of you to visit the Beyond Cancer website for more information, as we believe this year should be transformational for this potentially groundbreaking therapy for those suffering from solid tumors.
Speaker Change: I am also pleased with the advances that Neuronauts, a subsidiary focused on therapies for autism spectrum disorders, is making.
Speaker Change: During the December quarter, NeuroNOS announced the appointment of Professor Roger Kornberg to its Scientific Advisory Board. Dr. Kornberg is a renowned leader in the field of eukaryotic gene transcription and was awarded the Nobel Prize in Chemistry in 2006 for his groundbreaking work in molecular biology.
Speaker Change: Neuronauts will meet with FDA later this year to get an idea of the path to human studies, which we expect to begin in calendar 2026. The Neuronauts website offers a more complete understanding of what is to come over the next few years, including first in human data anticipated later in 2026.
Speaker Change: I hope you all see the great progress made recently and how these leading indicators paint a bright future for lung FIPPH and for nitric oxide as a revolutionary therapy across multiple indications.
Doug Larson: beyond their team will continue to be diligent on this path to profitability and improving the lives of patients in the need of the benefits of nitric oxide now I will turn it over to our CFO Doug Larson
Doug Larson: Thanks, Steve, and good afternoon, everyone. Our financial results for the third quarter of fiscal 2025, which ended December 31st, 2024, are as follows.
Doug Larson: Revenue for the fiscal third quarter of 2025 were $1.1 million as compared with $0.4 million a year ago.
Doug Larson: We're showing a $0.2 million loss in gross profit for the fiscal third quarter of 2025 compared to a $0.4 million loss for the same period last year.
Doug Larson: Cost of revenue in the current fiscal year exceeded revenue primarily due to 0.3 million dollars of one-time costs required to upgrade our existing fleet of devices plus 0.5 million dollars of non-cash headwinds, mainly the depreciation of devices purchased but not yet deployed.
Doug Larson: Research and development expenses were $3 million as compared to $6.8 million for the three months ended December 31st, 2023.
Doug Larson: The decrease of $3.8 million was primarily attributed to a decrease in salaries and stock-based compensation.
Doug Larson: SG&A expenses for the three months ended December 31st, 2024 and December 31st, 2023 were $7.7 million and $9.8 million, respectively.
Doug Larson: The decrease of 2.1 million dollars was attributed primarily to a decrease in salaries and stock-based compensation cost.
Doug Larson: Other expense was $2.4 million, compared to $0.3 million in the previous year. The increase of $2.1 million was mostly non-cash and attributed primarily to the extinguishment of the Avenue loan.
Doug Larson: Net loss attributed to common stockholders of Beyond Air, Inc. was $13 million or a loss of 15 cents per share basic and diluted. Our net loss for the three months and the December 31st, 2023 was $16.2 million or a loss of 50 cents per share basic and diluted.
Doug Larson: Net cash for in the quarter was $7.6 billion, which was more than 30% lower than the prior quarter ended September 30th, 2024.
Doug Larson: This decrease is mostly attributable to cost reductions implemented during the first half of fiscal year 2025, which included us closing two offices, 30% reduction in staff, putting our VCAP study on hold, and adjusting our production forecasts.
Doug Larson: We anticipate cash burn to continue the trend lower in the March quarter, but not to the same magnitude as we saw in this quarter due to the one-time costs required to complete the submission of our Next Generation Lung Fit pH to FDA.
Doug Larson: As of December 31st, 2024, the company had cash, cash equivalents, and marketable securities of $10.9 million.
Doug Larson: We believe that our cash, cash equivalents and marketable securities will be sufficient to allow us to support our current operating plans through the spring of 2026, provided we continue to hit our internal revenue estimates and control costs at BeyondAir. With that, I'll hand the call back to Steve.
Thanks, Doug. We will now take questions.
Speaker Change: Great, thank you. At this time, we will be conducting a question and answer session. If you'd like to ask a question, please press star one and your telephone keypad.
Doug Larson: A confirmation tone will indicate your line is in the question queue. You may press star 2 to remove yourself from the queue.
Speaker Change: Participants using speaker equipment, it may be necessary to pick up your handset before pricing the star keys.
One moment please while we wait for questions.
Speaker Change: First question is from Jason Witts from Roth Partners. Please go ahead.
Jason Witts: Thanks for taking the questions. Looks like nice progression this quarter. In terms of the CE mark, what should we think about in terms of timing, in terms of how that might start impacting revenues going forward?
Unknown Attendee
Speaker Change: much more after that. So it'll take a little bit to get going, but we're gonna be shipping in the first half of this calendar year for sure.
Speaker Change: Okay, that's good to know. And then in terms of expenses, from what you said, it sounds like for for op expenses, specifically
Speaker Change: I guess everything except R&D, that should be coming down additionally this next quarter, right? I think you said there's an incrementally, it'll come down incrementally the next quarter, although it sounds like R&D is going out specifically because the PMA, did I understand that correctly in terms of how the fourth quarter looks and kind of what the trend might be and all these expenses?
Speaker Change: Yeah, exactly. I mean the June quarter will be a much steeper drop than March quarter will be because we're getting this second-generation long-fit pH submitted.
Speaker Change: But the other expenses sound like there's still some additional incremental down on those expenses. I guess that's what I was asking as well. Yes, correct. Okay. And then maybe one last question, I'll jump back in queue. In terms of the PMA submission,
Speaker Change: and this may be an easy answer but a sense of how long you expect that may take to run through the process is that I understand that it's always hard to get visibility on the FDA.
Speaker Change: Especially now. I don't know how many people are going to be quitting the FDA or taking retirement or what. We really just don't know.
I guess we'll have a better idea once we.
Speaker Change: Submit, and as you know, there's usually a FDA acknowledges that receipt and send you out some questions and some thoughts and comments on your, your submission. So, I think we kind of need to wait for that to get an idea of of where FDA stands and what kind of resources they have to devote to this application.
Jason Witts: I don't even know if they know what their staff will look like, you know, in the next 60 days. So, I really don't have an answer for you, Jason. I wish I did, but.
Jason Witts: You know, I just don't I don't know how to handicap it at this moment. I think things are still in flux over there Got it. That's very fair. I will jump back in queue. Thank you very much Thanks, Jason
Speaker Change: Next question is from Marie Thibault from BTIG. Please go ahead.
Speaker Change: Hey, good afternoon. This is Sam on for Marie appreciate everyone taking the questions today.
Speaker Change: Maybe I could start here on the changes to the commercial organization. You know, it's been about seven months since...
Speaker Change: You know, I think it's more of a cultural shift. I think David, who's our new chief commercial officer, I don't want to call him new anymore. He's no longer new. But so I think David's driven a new.
Speaker Change: I think the culture was not good when we launched the product. I think it was for various reasons, and that culture needed to be changed. And I think Davey came in and created a new culture here.
Speaker Change: It's just a more positive attitude and I think our customer service is always strong. I think it's gotten better.
Speaker Change: We have even new leadership on our customer service side. Very excited about the gentleman who's running that now. And that makes a lot of difference when you're taking care of your customers, making sure that everything's running smoothly for them.
And right now, the machine's performing.
Speaker Change: beautifully and our customer service team actually has a lot more time on their hands to to work with our customers and potential new customers because they're not
You know
Unknown Attendee
Speaker Change: Again, what wasn't expected is how long it would take us to get all those upgrades through FDA. But now that they're through, it's running as we expected. So, I think the most important thing is the culture shift and our ability to have
superior customer service than to what one might expect.
Speaker Change: Yeah, yeah, it makes a lot of sense. And maybe just following up on the transport PMA submission.
Speaker Change: Douglas Goldstein, CFP®, is the director of Profile Investment Services and the host
Douglas Larson, Steven Lison, Unknown Attendee
Yeah, I got to be careful.
Speaker Change: How I answer this question for you. But yes, I think it comes up quite a bit about our next generation product. You know, we showed it back in November. People have seen it. People are excited about it. They want it.
Speaker Change: And I do think it's it's going to make all the difference. It's not just transport capable, but there are other upgrades that have been made and it's, it's a lot smaller and lighter. So, that will help a lot as well. So.
Speaker Change: People definitely want it and they're waiting for it, but I'm not going to go so far as to say we have a waiting list. I won't say that.
Speaker Change: Okay, okay, very good. And maybe I can just squeeze in one final one in terms of annualized contract revenue. I think it was about three and a half million as of October. Any update on that metric or is that something you're still providing?
All right.
looking at Doug right now, was it that high?
We probably aren't going to comment on that.
Speaker Change: I guess the comment will be that I guess the streets around 4 million for a fiscal year of 25.
Speaker Change: and I think that's certainly a good a good place to be. As for what the run rate will be...
Speaker Change: I'll leave that to you. You saw what we put up this quarter. It's going to grow next quarter, when the March quarter will be higher than the December quarter for sure. So you can kind of guess what that run rate will be.
Yeah, makes sense. Thanks for taking the questions.
Yep, thanks.
Speaker Change: Next question is from Jason Bednar from Piper Sandler. Please go ahead.
Jason Bednar: Hey guys, congrats on the quarter here and the progress. Yes, Steve, I'll start with one. I'm not sure you're going to.
Speaker Change: You'll be able to answer it or not, but I'll try.
You know, you say you're going to be reintroducing.
Douglas Larson, Steven Lison, Unknown Attendee
Speaker Change: And we can all see where the streets at, I guess, just as you try to maybe prep the street investors.
Speaker Change: Do you like where the street is currently sitting for fiscal 26? We're all kind of already modeling.
Speaker Change: pretty strong double-digit sequential growth quarter-on-quarter throughout the year. So would you say it's too strong? Would you like things to be more conservatively set? Any kind of thoughts or early thoughts there on the setup for the year?
Jason Witts: Well, thanks for bringing a smile to my face, Jason. You know, we're definitely not going to comment. We'll give guidance in June for the fiscal year and I am not going to give you any, any.
Jason Witts: hints on what you should do with your numbers. You know, you'll see what we report in June, and I'll give you that guidance. So,
Jason Witts: In general, you know, we as a company internally, we feel really good about what we're doing right now. We feel really good about the progress we've made and the momentum we have, so I'll leave it at that.
Speaker Change: Okay, as we get closer and approach that point, do you think you'll be in a position to talk about the contribution you expect from U.S. versus international partnerships, or are you just thinking about, hey, here's our total worldwide revenue guidance and we'll leave it at that?
Speaker Change: I think it's going to be total because I think it's too early for us to...
Speaker Change: To gauge, you know, that that ratio, you know, international could.
Speaker Change: You know it could move faster than we think you know it could take a little longer than we think where we we have lots of countries to go through The regulatory process you know outside of the European Union and as you know inside the European Union You know even though we have CE mark this some countries are quicker than others in terms of getting your product to the market so
Speaker Change: Those are some of the things that are out of our control. So we just don't know how quickly it will happen. And again, even in the US, you know, things can be a little chunky in terms of, you know, timing of when contracts start. So to really nail down that
Speaker Change: ratio between the two I think that's going to be tough when we give guidance maybe maybe after a year of experience under our belt we might be able to do a little bit better but
Speaker Change: You know, I think that's that's going to be tough, but the total number will will be will be able to
Speaker Change: Give ourselves some room on our total number with guidance so that You know if there's movement between those two up or down in terms of expectations We'll we'll be perfectly fine to hit our our guidance that we're going to give
Okay.
Speaker Change: As you get maybe a bit more rhythm in the business too, and a bit more experience now that you've been at the hospital contracting for a while, any...
Speaker Change: Seasonality that you're noticing on the contracting piece on, you know, when some of these contracts are coming up for bid, when hospitals are moving forward with decision making, or is it, or you're not seeing any kind of, you know, notable seasonality to the, to the business in the process?
Speaker Change: I don't really think there's much seasonality to it. You know,
Speaker Change: I don't really think there is. And again, it's, it's, it's depends on some hospitals are, you know, larger than others. So.
Speaker Change: You could get two or three hospitals in one quarter and have one big one and get seven the next quarter and Those seven might not equal the big one. So it's just it's pretty chunky at this point and and
You know, I think
What we've seen is hospitals are starting...
Speaker Change: or every month of the year. We haven't really seen a.
Speaker Change: a major time point. And a lot of them, you know, they
I don't want to give too much, but.
Speaker Change: They don't have, they can start, some of the contracts they can start when they want, right? They don't have to wait till the end of the contract, right? There are ways to move out of certain contracts.
Speaker Change: So if they want to move, you know, they just say, hey, we want to move and they just go. So it just depends on the type of contract that they have.
Speaker Change: I think it's very variable. I think it's it's it's when they make up their mind. They want to move they'll move
Speaker Change: Okay, that's all helpful. One last one to squeeze in. And sorry if I missed it. Did you, I know you were, there's a prior question around the PMA submission for the next gen device.
Speaker Change: I don't think you commented on the the status of the
Speaker Change: The cardiac label expansion or indication in that in response to that question. Is there anything you can update on?
Speaker Change: The status with the FDA questions you're receiving just how that's looking as you as you move forward when trying to secure that that label.
Speaker Change: Yeah, it's kind of the same thing I said about the PMA for the next gen system.
Speaker Change: that we're certainly in contact with them about this, but it's.
Speaker Change: It's a little bit in flux at the moment, but we're just kind of waiting for things to settle down a little bit with FDA, and we'll keep working with them.
Speaker Change: That's all I can say right now. I don't really have much detail to give on this other than that we're working with them and we'll continue to do so and push forward with this. I mean, this is a...
Speaker Change: This is an indication that obviously is approved everywhere in the world, but the United States. So I think for patients, patient safety, this is something that should be laid.
Speaker Change: Absolutely. So we'll keep working with the FDA and get them what they need.
All right, excellent. Thanks very much, guys.
Unknown Speaker
Speaker Change: Next question is from Justin Walsh from Jones Trading. Please go ahead.
Speaker Change: Hi, thanks for taking the question. I'm wondering if you can remind us how you view the longer term relative importance of U.S. versus ex-U.S. geographies for lung fit, pH, and maybe the expected impact in different geographies of the next generation product as that gets out there.
Speaker Change: Yeah, I mean, you look out five years, I think actually we're awesome.
It would be much bigger than the U.S.
Speaker Change: You know, right now it's not, but with our product, the fact that, you know, we're making it from ambient air, it changes the game. It's, it's not easy for a lot of these.
Speaker Change: countries to deal with cylinders or they may just be cost prohibitive or it's geographically prohibitive and we solve that problem. I think that one example of that is
Speaker Change: The Naval Base in Guam, you know, I think we're the only ones that could support them
Bye.
Speaker Change: It's that simple. So that will occur in our opinion, you know, all over the world where it's difficult to get nitric oxide.
Speaker Change: So that's going to take time. It's not going to happen overnight. It's not going to happen next year But if you're looking out five years, I think XUS is going to be a lot bigger than the United States market
Speaker Change: In terms of money and total volume for sure. So we're very excited about the XUS opportunity
Speaker Change: But again, that will take some time to roll out so I don't see it impacting
Unknown Attendee
Massively fiscal 26 or 27 in a meaningful way.
Speaker Change: where it's larger than the US market. It'll impact us in a meaningful way as a company, but
Speaker Change: It won't look bigger than the U.S. market. I think that beyond that, starting in what's our fiscal 28, which would be mostly calendar 27, you'll start to see that trend moving. I think you'll start to realize, wow, you know, the volume is picking up, you know.
Speaker Change: Globally, this is going to be a much bigger product than anyone believes.
Speaker Change: Next question comes from Yael Chen from Leblon Company. Please go ahead.
Yael Chen: Good afternoon and thank you for taking the question. And Steve, you mentioned you've got six new hospitals and two renews in the U.S. for this quarter. Is that right?
That's correct.
Yael Chen: And last time you mentioned sort of that you got a previous quarter, you got 60% increase in terms of the hospital contract.
Yael Chen: Would you be able to give any colors of that front? And then maybe one more question here is that for the last quarter's contract, any actually being becoming paying customers of this quarter?
Unknown Attendee
Speaker Change: So I don't have the numbers in front of me about the percentage increase like I did last quarter. My apologies, I can get that for you and get it to you.
offline.
Speaker Change: But I didn't catch the last part of your question about paying customers, I'm sorry. What was that? I mean, last quarter, you have a certain number of contracts signed.
Speaker Change: Some of those contracts may not be paid immediately, in other words, purchased immediately. I'm just curious whether anything... Some of those contracts of this quarter already become purchased.
Speaker Change: Unknown Attendee So, yeah, we can sign a contract. The majority of contracts when you sign them, the customer starting like within 30 to 45 days with you.
Speaker Change: Some of them within 15 days sometimes, but usually when they sign a contract, it's a start, I would say, within 60 days or less, usually.
Speaker Change: but every once in a while you have a hospital that assigns something you know three or six months in advance and say hey we're signing with you start us in five months so that does happen so we did have a hospital
Doug Larson: One or two, Doug. Two hospitals in the March quarter. No.
No, no, they didn't start in December.
Speaker Change: Right, we actually had two hospitals that were signed in the summer that are starting in the March quarter.
Speaker Change: But December was all signed and started right in December, in the December quarter. There were no longer term, nobody signed in the December quarter and didn't start in the December quarter.
Speaker Change: But we had people over the summer who started in the September quarter, and they're starting in the March quarter.
That is true.
Speaker Change: So, in other words, the turnaround time becomes shorter, and do you anticipate this sort of trend continues, or this could be lumpy, varying, depends on the contract?
Speaker Change: No, look, the two hospitals that signed six months in advance, that's rare. I mean, that's not normal, at least from what we've seen. Most of the hospitals are signing and starting up within
Speaker Change: you know, 30 days, 45 days mostly. So I think that was just a little
Speaker Change: Out of the ordinary, I'm not saying it's never going to happen, but it's it's rare at least from what we've seen so far
Perhaps other companies in the space see it differently, but...
Speaker Change: Like I said, when a hospital wants to switch, they wanna move, they move and they're done. So.
Speaker Change: I think, you know, honestly, I think sometimes hospital wants to go with us and they don't realize they can't get out of their contract. So they just sign with us and wait. I think that's what happened with these two hospitals. So.
You know, sometimes that happens
So I think it's more agreeable.
Speaker Change: Okay, great. I appreciate the colors on that. Maybe two quick questions. First one, in terms of balance sheet, as you look at it, you are totally out of the long-term debt. Is that correct?
No, no, we remember last quarter we.
Speaker Change: We swapped out the debt, so we have $11.5 million, but the payments on that don't begin until October of 2026.
Speaker Change: So it gives us time before we make any payments on that.
Speaker Change: So the interest is accruing and going on top of the principal until we start making payments and that's an 8% royalty on net sales that pays that. So we don't have any...
Speaker Change: schedule payments it's just at the end of the September quarter of 26 of calendar 26 that is we will make a payment it's 30 days later Doug or 45 days later
Speaker Change: Yeah, 30 days later, we make a payment. So we start making those payments based on our ability to pay based on net sales.
Speaker Change: So that's the structure of that debt structure is very company friendly, obviously.
Speaker Change: Absolutely. I mean, maybe their last question here is that you have this transport of a new next-gen device.
Speaker Change: Let's just assume if for any reason that you may have your both NICU and the cardiac PMA or supplement PMA approved, would you fire for the next-gen for both indications or you still start with the NICU immune?
Speaker Change: and maybe later for the cardiac surgery once you have the supplement for the regular system approved.
Speaker Change: That's a pretty good question, you know, I haven't really thought about that one. You know, I don't, I think this is a PMA supplement. Right. Our next generation is a PMA supplement for.
You know currently approved lung fit pH
Speaker Change: So, I think it would kind of just be automatic. I don't really know my regulatory mouth shut, but I think it's since it's a PMA supplement, our second generation for our first generation, we're just going to assume whatever the list for the first generation.
I got you.
Right, right, right. It's an improved version of it.
Douglas Larson, Steven Larson, Unknown Attendee
Great. Thanks, you.
Speaker Change: This concludes the question and answer session. I'd like to turn the floor back to management for any questions.
Speaker Change: Thanks everybody for joining us. We are definitely looking forward to speaking with you in June and providing guidance for you. Thank you.
Speaker Change: This concludes today's teleconference. You may disconnect your lines at this time. Thank you again for your participation.