Q4 2024 Humacyte Inc Earnings Call

Speaker Change: [music].

Yeah.

Operator: Good morning, ladies and gentlemen, and welcome to the Humacyte fourth quarter results conference call. Currently, all participants are in listen only mode. Later, we'll conduct a question and answer session and instructions will follow at that time. Just a reminder, this conference call is being recorded.

Speaker Change: Good morning, ladies and gentlemen, and welcome to the Hemocyte fourth quarter results Conference call.

Speaker Change: Currently all participants are in a listen only mode.

Speaker Change: Later, we will conduct a question and answer session and instructions will follow at that time.

Speaker Change: As a reminder, this conference call is being recorded.

Tom Johnson: I'll now turn the call over to Tom Johnson with Lifestyle Advisors. Please go ahead, sir. Thank you, operator.

Speaker Change: I'll now turn the call over to Tom Johnson lifestyle Advisors. Please go ahead Sir.

Speaker Change: Thank you operator before we proceed with today's call I would like to remind everyone that certain statements made during the call are forward looking statements under U S. Federal Securities laws. These statements are subject to risks and uncertainties that could cause actual results to differ materially from historical experience or present expectations additional information concerning <unk>.

Tom Johnson: Before we proceed with today's call, I would like to remind everyone that certain statements made during the call are forward looking statements under U.S. federal securities laws. These statements are subject to risks and uncertainties that could cause actual results to differ materially from historic experience or present expectations. Additional information concerning factors that could cause actual results to differ from statements made on this call are contained in our periodic reports filed with the SEC.

Speaker Change: So that could cause actual results to differ from statements made on this call are contained in our periodic reports filed with the SEC.

Unknown Attendee: For more information visit www.fema.gov Unknown Attendee, Heather Prichard, Lauren Marek, Michael Curi, Tom Johnson, William Scheessele, Information presented on this call continue to the press release we issued this morning and in our Form 10-K, which after filing may be accessed from the investor page of the Humacyte website.

Speaker Change: Forward looking statements made during this call speak only as of date of hereof, and the company undertakes no obligation to update or revise forward looking statements except required by law.

Speaker Change: Information presented on this call contained in the press release, we issued this morning and in our Form 10-K, which after filing may be accessed from the investor page of the human psyche website.

Tom Johnson: Joining me on today's call from Humacyte are Dr. Laura Niklason, President and Chief Executive Officer, and Dale Sander, Chief Financial Officer and Chief Corporate Development Officer.

Speaker Change: Joining me on today's call from Hemocyte are Dr. Laura Nicholson, President and Chief Executive Officer, and Bill Sander, Chief Financial Officer, and Chief Corporate Development Officer.

Tom Johnson: Dr. Niklason will provide a summary of the company's major events for the fourth quarter in recent weeks, and Dale will review the company's financial results for the year ended December 31, 2024. Following their prepared remarks, we will open the call to questions from covering analysts.

Speaker Change: Ducker Nicholson will provide a summary of the companys major events for the fourth quarter and recent weeks and Joe will review the Companys financial results for the year ended December 31 2024.

Speaker Change: Following their prepared remarks, we will open the call to questions from covering analysts with that I will now turn the call over to Dr. Nicholas Laura.

Laura Niklason: With that, I will now turn the call over to Dr. Niklason. Thank you, Tom. Good morning, everyone. And thanks for joining us for our fourth quarter and full year 2024 Financial Results and Business Update call. 2024 has been a landmark year for Humacyte, highlighted by the FDA's full approval of SimVest for the treatment of extremity vascular trauma. SimVis is a biological product that went through more than 20 years of research and development. And we believe that this first-in-class approval marks an important new era in vascular surgery. We're thrilled to deliver this transformative innovation to surgeons and to patients in need of a new option.

Speaker Change: Thank you Tom Good morning, everyone and thanks for joining us for our fourth quarter and full year 2024 financial results and business update call.

Nicholas Laura: 2024 has been a landmark year for human site I highlighted by the Fda's full approval of Sim deaths for the treatment of extremity vascular trauma soon.

Nicholas Laura: <unk> is a biological product that went through more than 20 years of research and development and we believe that this first in class approval marks an important new era in vascular surgery.

Nicholas Laura: We're thrilled to deliver this transformative innovation to surgeons and to patients in need of a new option to save limbs and lives.

Laura Niklason: to save limbs and lives. Results from our preclinical studies and our clinical studies suggest that there are patients walking around on their own legs today who would not be doing so if SimVests were not available. Our commercial launch of SimVest is proceeding at full speed and we're excited with the response to date from hospitals and health care providers. So far, the market has responded well, with 34 hospitals already having initiated their Value Analysis Committee, or VAC, approval process. These hospitals are a mix of leading trauma centers that were participants in Humacyte's clinical studies and are combined with institutions that have been newly introduced to SimVet.

Nicholas Laura: Results from our preclinical studies and our clinical studies suggest that there are patients walking around on their own legs today, who would not be doing so if that were not available.

Nicholas Laura: Our commercial launch of synthesis proceeding at full speed and we're excited with the response to date from hospitals and health care providers. So far the market has responded well with 34 hospitals already having initiated their value analysis committee or V. A C approval process.

Nicholas Laura: These hospitals are a mix of leading trauma centers that were participants in humans sites clinical studies and our combined with institutions that have been newly introduced the synthesis.

Laura Niklason: Bye. VACs have been engaged in individual institutions and in centers from much larger networks, meaning that individual VAC approvals could apply to multiple hospitals. Although the VAC process often takes three to six months to complete, three hospitals have already approved the purchase of SimVac. We're also excited that just 16 days after having the commercial inventory availability, we made our first shipments of CIMVES. These first commercial shipments were made last week to several Level 1 trauma. The potential health benefits of CIMVAS are also supported by our budget impact model that was just published in the Journal of Medical Economics.

Nicholas Laura: [noise].

Nicholas Laura: That's had been engaged in individual institutions and it centers from much larger networks, meaning that individuals' vac approvals could apply to multiple hospitals.

Nicholas Laura: Although the vac process, often take three to six months to complete three hospitals have already approved the purchase of sandbox.

Nicholas Laura: We're also excited that just 16 days after having the commercial.

Nicholas Laura: Inventory availability.

Nicholas Laura: We made our first shipments of synthesis.

Nicholas Laura: First commercial shipments were made last week to several level one trauma centers.

Nicholas Laura: The potential health benefits of him ups and Beth are also supported by our budget impact model that was just published in the journal of medical Economics.

Laura Niklason: This paper concludes that the avoidance of vascular infections and amputations drive the cost reductions that are associated with the use of SymVeS in traumatic injury. Based on the model, the per-patient cost of treating SIMVAS patients with SIMVAS is estimated to be less than the cost of treating trauma patients with either synthetic grafts, cryopreserved allografts, or xenografts. On a related note, in October 2024, we submitted a new technology add-on payment, or NTAP application for CIMBAS, to the Centers for Medicare and Medicaid Services, or CMS. And we presented the CIMBAS data at a public town hall with CMS in December of 2024.

Nicholas Laura: This paper concludes that the avoidance of vascular infections in amputations drive the cost reductions that are associated with the use of <unk> and traumatic injury.

Nicholas Laura: Based on the model the per patient cost of treating <unk> patients with thin Beth is estimated to be less than the cost of treating trauma patients with either synthetic grass cryo preserved allografts, whereas in the graph.

Nicholas Laura: On a related note in October 2024, we submitted a new technology add on payment or N tap application for send that to the centers for Medicare and Medicaid services or CMS and we presented this invest data at a public town Hall with CMS in December of 2024.

Laura Niklason: There are really two important criteria for getting an NTAP. First is that the technology is new, for which we clearly qualify. The second is that the technology provides an important clinical benefit above and beyond what's currently available. We believe that we checked both of these boxes and that we have a strong case for getting NTAP reimbursed. If successful, NTAP reimbursement will begin on October 1st, 2025, offering hospitals additional payment to cover the cost associated with purchasing FinVET.

Nicholas Laura: There are really two important criteria for getting in and tap first is that the technology is new for which we clearly qualify.

Nicholas Laura: The second is that the technology provides an important clinical benefit above and beyond what's currently available.

Nicholas Laura: We believe that we checked both of these boxes and then we have a strong case for getting and tap reimbursement.

Nicholas Laura: If successful and tap reimbursement will begin on October one 2025, offering hospitals additional payments to cover the cost associated with purchasing synthesis.

Laura Niklason: In January of 2025, Humacyte was issued a new U.S. patent covering key aspects of the manufacturing system for CIMVAS and other bioengineered human tissue. The newly issued patent provides protection into 2040. The new patent complements a family of existing patents and patent applications, encompassing the design and the composition of matter of SimVest and our other product candidates, as well as their methods of manufacturing.

Nicholas Laura: In January of 2025, humus like was issued a new U S patents covering key aspects of the manufacturing system for service and other bio engineered human tissues.

Nicholas Laura: The newly issued patent provides protection into 2040.

Nicholas Laura: The new patent complements our family of existing patents and patent applications encompassing the design and the composition of matter of Sim Beth and our other product candidates as well as their methods of manufacture.

Laura Niklason: Before moving into development elsewhere in our pipeline, I'd like to take a moment to acknowledge our exceptional commercial team, which is led by B.J. Scheessele, our Chief Commercial Officer, which has been crucial in the early success of this launch. To drive adoption, we recruited and trained a highly experienced sales team for the commercial launch of Simba. All sales team members are multi-year President's Club winners, representing the top 10% of achievers in their prior sales organization. Team members also have experience in vascular and trauma surgery, prior experience selling regenerative therapies, and are expert at selling clinically differentiated and disruptive technologies and premium price portfolios.

Nicholas Laura: Before moving into development elsewhere in our pipeline I'd like to take a moment to acknowledge our exceptional commercial team, which is led by BJ Chesley ours, Chief commercial officer, and which has been crucial in the early success of this launch.

Nicholas Laura: To drive adoption, we recruited and trained a highly experienced sales team for the commercial launch of synthesis. All sales team members are multiyear President's club winners representing the top 10% of achievers in their prior sales organizations.

Nicholas Laura: Team members also have experience in vascular and trauma surgery prior experience selling regenerative therapies, and our expert at selling clinically differentiated and disruptive technologies and premium priced portfolios.

Laura Niklason: This is a highly experienced and a highly motivated group that is deeply committed to ensuring that CIMVAS reaches hospitals and vascular surgeons, both civilian and military. We have complete confidence in their ability to execute our commercial strategy and drive adoption, and their expertise has been invaluable in these early stages of commercial law. This team will continue to work closely with healthcare providers to make SimVests available to patients in need nationwide.

Nicholas Laura: This is a highly experienced and highly motivated group that is deeply committed to ensuring that seem beth reaches hospitals and vascular surgeons, both civilian and military.

Nicholas Laura: We have complete confidence in their ability to execute our commercial strategy and drive adoption and their expertise has been invaluable in these early stages of commercial launch this.

Nicholas Laura: This team will continue to work closely with health care providers to make sense, that's available to patients in need nationwide.

Laura Niklason: Going beyond the trauma indication, we're also very excited about the ATEV program right behind it, which is in Dialysis Action. As you'll recall, in last October, our VO7 Phase 3 clinical trial of the ATAV and AV-AXIS for patients with end-stage renal disease were presented at the American Society of Nephrology Kidney. The Phase III study met its co-primary endpoints, and the ATF was observed to have superior function and patency at 6 and 12 months as compared to AV fistula, which is the current standard of care for hemodialysis. The ATEP was also observed to have superior function in female, obese, and diabetic patients.

Nicholas Laura: Going beyond the trauma indication. We're also very excited about the eighth have.

Nicholas Laura: Program right behind it which is in dialysis access.

Nicholas Laura: As you'll recall in last October our V O seven phase III clinical trial of the <unk> and a V access for patients with end stage renal disease were presented at the American Society of Nephrology kidney week.

Nicholas Laura: The phase III study met its co primary endpoints and the ATF was observed to have superior function in patency at six and 12 months as compared to Avi Fischer <unk>, which is the current standard of care for hemodialysis patients.

Nicholas Laura: The <unk> was also observed to have superior function in female obese and diabetic patients each of which is a high risk subgroup, having historically poor outcomes with a b fischler.

Laura Niklason: each of which is a high-risk subgroup having historically poor outcomes with A.B.

Laura Niklason: Fisher. In addition, we've already enrolled 76 patients. in our VO-12 phase 3 clinical study, which is a trial designed to assess the usability of the ATEM for dialysis as compared to fistulas in female patients. This is the first study of its kind that's been done in females. An interim analysis is planned when the first 80 female patients reach one year of follow-up. And we're very close to this 80-patient interim enrollment target. Subject to these interim results, our plan is to submit a supplemental BLA in the second half of 2026 that includes data from the VO-12 study and the VO-7 study in order to add AV access for hemodialysis as an indication for the ATI.

Nicholas Laura: In addition, we've already enrolled 76 patients.

Nicholas Laura: And our V O 12 phase III clinical study, which is a trial designed to assess the usability of the a tab for dialysis as compared to Fistulas in female patients. This is the first study of its kind that's been done in females.

Nicholas Laura: An interim analysis is planned when the first 80 female patients reached one year of follow up and we're very close to this 80 patients interim enrollment target.

Nicholas Laura: Subject to these interim results our plan is to submit a supplemental BLA in the second half of 2026 that includes data from the V. O 12 study and the V. O seven study in order in order to add Avi access for hemodialysis as an indication for the ACF.

Laura Niklason: And finally...

Nicholas Laura: And finally.

Laura Niklason: I'll briefly discuss one of our earlier stage programs that we're also very excited about, our Small Diameter ATAB for the Treatment of Coronary Artery Bypass Grafting, or CABG. In January, we announced our plans to file an IND application with the FDA to allow a first-in-human clinical testing of our small-diameter, 3.5-millimeter ATEV in coronary artery bypass. Our plans are based on the outcome of a recent meeting held with the FDA, including agreements that were reached with the agency on the filing of an IND.

Nicholas Laura: I'll briefly discuss one of our earlier stage programs that we're also very excited about our small diameter, a tab for the treatment of coronary artery bypass grafting or cabbage and.

Nicholas Laura: In January we announced our plans to file an IND application with the FDA to allow our first in human clinical testing of our small diameter 3.5 millimeter a tab in coronary artery bypass.

Nicholas Laura: Our plans are based on the outcome of a recent meeting held with the FDA, including agreements that were reached with the agency on the filing of an I M D.

Laura Niklason: The planned IND filing is supported in part by the results of a six-month preclinical study of the small diameter ATEV in primates, which was presented in November 2024 at the American Heart Association. In the preclinical cabbage model, our small-diameter ATAV was observed to sustain patency. It recellularized with the host animal's cells, and it also remodeled so as to match the size of the animal's native coronary artery.

Nicholas Laura: The planned Diane D filing is supported in part by the result of a six month preclinical study of the small diameter eight have in primates, which was presented in November 2024 at the American Heart Association.

Nicholas Laura: In the preclinical cabbage model, our small diameter, a tab was observed to sustained patency and recellular rise with the animal host animal cells and it also remodeled so as to match the size of the animals native coronary arteries.

Laura Niklason: We're very pleased to be moving closer to human clinical studies of the ATAB in CABG, and we believe our IMD filing and initiation of first in human study after the FDA clearance of the IMD will be another major milestone for human. So 2025 will be an exciting year for all of us, and we look forward to sharing our progress with all of you as the year unfolds.

Nicholas Laura: We're very pleased to be moving closer to human clinical studies with the H turbine cabbage, and we believe our I M. D filing an initiation of first in human study after the FDA clearance of the I N V will be another major milestone for human site.

Nicholas Laura: So 2025 will be an exciting year for all of us and we look forward to sharing our progress with all of you as the year unfolds and with that I'll now turn it over to Dale for a review of our financial results and other business development.

Dale Sander: And with that, I'll now turn it over to Dale for a review of our financial results and other business developments. Thank you, Laura, and good morning to everyone.

Nicholas Laura: Okay.

Dale: Thank you Laura and good morning to everyone there.

Dale Sander: There was no revenue for the fourth quarter of 2024 or 2023, and there was no revenue for the years ended December 31st, 24 and 23. Obviously with the commencement of launch in the last several weeks, we have obviously started booking commercial revenues for the first time in the company's history within the last several weeks. Research and development expenses were $20.7 million for the fourth quarter of 2024, less than the $22.9 million incurred for the third quarter of 2024. The decrease in expenses compared to the prior quarter was primarily attributed to a reduction in materials expenses due to the timing of manufacturing runs.

Dale: There was no revenue for the fourth quarter of 2024 or 22023, and there was no revenue for the years ended December 31, 24, and 23, obviously with the commencement of launch in the last several weeks. We have obviously started booking commercial revenues for the first time in the company's history within the last.

Dale: Several weeks.

Dale: Research and development expenses were $20 7 million for the fourth quarter of 2024.

Dale: Less than the $22 9 million incurred for the third quarter of 2024.

Dale: The decrease in expenses compared to the prior quarter was primarily attributed to a reduction in materials expenses due to the timing of manufacturing runs.

Dale Sander: Research and development expenses for the fourth quarter of 2024 were $20.7 million, a slight increase compared to the $20.2 million incurred in the fourth quarter of 2023. Research and development expenses were $88.6 million for the year ended December 31, 2024, compared to $76.6 million for the year ended December 31, 2023. The increase in expenses during the full year ended December 31, 2024, resulted primarily from increased material expenses associated with manufacturing runs and personnel expenses. These increases supported expanded research and development initiatives and clinical trials. including the expansion of manufacturing activities in support of the FDA review of the BLA in extremity vascular trauma.

Dale: Research and development expenses for the fourth quarter of 2024 were.

Dale: 27 million, a slight increase compared to the $20 2 million incurred in the fourth quarter of 2023.

Dale: Research and development expenses were $88 6 million for the year ended December 31, 2024, compared to 76 6 million for the year ended December 31 2023.

Dale: The increase in expenses during the full year ended December 31, 2024 resulted primarily from increased material expenses associated with manufacturing runs and personnel expenses.

Dale: These increases supported expanded research and development initiatives and clinical trials.

Dale: Including the expansion.

Dale: Are you factoring in activities in support of the FDA review of the BLA and extremity vascular trauma.

Dale Sander: General and administrative expenses were $7.4 million for the fourth quarter of 2024, consistent with the $7.3 million incurred for the third quarter of 2024. General and administrative expenses were $7.4 million for the fourth quarter of 2024, compared to $6 million for the fourth quarter of 2023, and were $25.8 million for the year ended December 31, 2024, compared to $23.5 million for the year ended December 31, 2023. The increases during 2024 resulted primarily from preparation for the planned commercial launch of CIMBES, including increases in personnel expenses and professional fees. These increases were partially offset by a decrease in non-cash stock compensation expense during 2024.

Dale: General and administrative expenses were $7 4 million for the fourth quarter of 2024, consistent with the $7 3 million incurred for the third quarter of 2024.

Dale: General and administrative expenses were $7 4 million for the fourth quarter of 2024.

Dale: <unk> 6 million for the fourth quarter of 2023 and.

Dale: And were $25 8 million for the year ended December 31, 2024, compared to $23 5 million for the year ended December 31 2023.

Dale: The increase was during 2024 resulted primarily from preparation for the planned commercial launch of <unk>, including increases in personnel expenses and professional fees.

Dale: These increases were partially offset by a decrease in noncash stock compensation expense during 2024.

Dale Sander: Other Net Income or Expense. was net income of $7.1 million for the fourth quarter of 2024, compared to net expense of $9 million for the third quarter of 2024. The increase in other net income compared to the prior quarter was due to the non-cash remeasurement of the contingent earn-out liability associated with the company's 2021 merger with Alpha Healthcare Acquisition Corp. Other net income for the fourth quarter of 2024 of $7.1 million compared to other net income of $1.1 million for the fourth quarter of 2023 and other net expense of $34.3 million for the year ended December 31st, 2024 compared to net expense of $10.7 million for the year ended December 31st, 2023.

Dale: Other net income or expense was net income of $7 1 million for the fourth quarter of 2024.

Dale: Third a net expense of $9 million for the third quarter of 2024.

Dale: The increase in other net income compared to the prior quarter.

Dale: Due to the noncash remeasurement of the <unk>.

Dale: Tension earn out liability associated with the company's 2021 merger with Alpha Healthcare acquisition Corp.

Dale: Other net income for the fourth quarter of 2024 of $7 1 million compared to other net income of $1 1 million for the fourth quarter of 2023 and the other net expense of $34 3 million for the year ended December 31, 2024, compared to net expense of $10 7 million for the year ended.

Dale: Remember 31 2023.

Dale Sander: The increase in other net income during the fourth quarter of 2024 compared to 2023 and the increase in other net expense during the year ended December 31st, 2024 compared to 2023 resulted primarily from non-cash remeasurement of the contingent burnout liability mentioned earlier. Net loss was $20.9 million for the fourth quarter of 2024 compared to $39.2 million for the third quarter of 2024. and to $25.1 million for the fourth quarter of 2023. The decrease in net loss for the fourth quarter of 2024 compared to the prior quarter and to the prior year resulted from the non-cash remeasurement of the contingent earn out liability described earlier.

Dale: The increase in other net income during the fourth quarter of 2024 compared to 2023 and the <unk>.

Dale: Kris and other net expense during the year ended December 31, 2024, compared to 2023 solid primarily from noncash remeasurement of the contingent earn out liability mentioned earlier.

Dale: Net loss was $20 9 million for the fourth quarter of 2024 compared to $39 2 million for the third quarter of 2024.

Dale: And to $25 1 million for the fourth quarter of 2023, the decrease in net loss for the fourth quarter of 2024 compared to the prior quarter into the prior year.

Dale: From the noncash remeasurement of the contingent earn out liability described earlier.

Dale Sander: Net loss was $148.7 million for the year ended December 31, 2024, compared to $110.8 million for the year ended December 31, 2023. The year-over-year increase in net loss in 2024 compared to 2023 resulted again from the non-cash remeasurement of the contingent earn out liability.

Dale: Net loss was $148 7 million for the year ended December 31, 2024, compared to $110 8 million for the year ended December 31 2023.

Dale: The year over year increase in net loss in 2024 compared to 2023 solid again from the noncash remeasurement of a contingent earn out liability.

Dale Sander: We had cash, cash equivalents, and restricted cash of $95.3 million as of December 31st, 2024. Subsequent to December 31st, 2024, this week, we completed an underwritten public offering of common stock that provided approximately 46.6 million in additional net proceeds, with the potential for another 7.1 million in net proceeds, subject to an underwriter option.

Dale: We had cash cash equivalents and restricted cash of $95 3 million as of December 31, 2024 sub.

Dale: Subsequent to December 31, 2024.

Dale: This week, we completed an underwritten public offering of common stock that provided approximately 46 6 million in additional net proceeds with the potential for another $7 1 million in net proceeds subject to an underwriter option.

Dale Sander: Total net cash provided. was $14.5 million for the year ended December 31st, 2024 compared to total cash used of $69.0 million for the year ended December 31st, 2023. The increase in net cash provided resulted primarily from the receipt of proceeds from public offerings in a direct registered offerings of stock completed throughout 2024 and proceeds from an additional draw under our funding agreement with Oberlin Capital Management.

Dale: Total net cash provided.

Dale: Well it was $14 5 million for the year ended December 31 2024.

Dale: Total cash cash use of 69 point.

Dale: Zero million for the year ended December 31 2023.

Dale: The increase in net cash provided resulted primarily from the receipt of proceeds from public offerings in a direct.

Dale: Registered offerings of stock completed throughout 2024.

Dale: And proceeds from an additional draw under.

Dale: Our funding agreement with Oberland capital management.

Laura Niklason: With that, I will turn the call back to Laura. Thank you Dale. The approval and launch of Symbeth is a powerful example of our commitment to delivering truly transformative regenerative medicine solutions that improve patient outcomes. With our strong commercial execution and our promising pipeline programs and our dedicated team, we are confident that Humacyte will have positive impacts in the care of vascular patients in the years to come.

Laura Nicholson: With that I will turn the call back to Laura.

Laura Nicholson: Thank you Dale the approval and launch of <unk> is a powerful example of our commitment to delivering truly transformative regenerative medicine solutions that improve patient outcomes.

Laura Nicholson: With our strong commercial execution and a promising pipeline programs and our dedicated team. We are confident that human site will have positive impacts in the care of vascular patients in the years to come.

Operator: Thank you all for joining today, and operator, we're ready to take questions. Thank you.

Laura Nicholson: Thank you all for joining today and operator, we're ready to take questions.

Speaker Change: Thank you at this time, we'll now be conducting a question and answer session.

Operator: At this time, we'll now be conducting a question and answer session. If you would like to ask a question today, you may press star one from your telephone keypad and a confirmation tone will indicate your line is in the question queue. If you'd like to withdraw your question from the queue, you may press star 2. For participants that are using speaker equipment, it may be necessary to pick up the handset before pressing the star key. We'll pause a moment to assemble the queue and once again it's star 1 to ask questions. Thank you.

Speaker Change: If you'd like to ask a question today you May press star one from your telephone keypad and a confirmation tone will indicate your line is in the question queue.

Speaker Change: If you'd like to withdraw your question from the queue you May press star two.

Speaker Change: Participants are using speaker equipment, it may be necessary to pick up the handset before pressing the star keys.

Speaker Change: We'll pause a moment to assemble the queue and once again it is star one to ask questions. Thank you.

Speaker Change: Thank you. Our first question today is coming from the line of Josh Jennings with TD Cowen.

Josh Jennings: Our first question today is coming from the line of Josh Jennings with T.D. Cowan. Please receive your questions.

Speaker Change: Proceed with your questions.

Josh Jennings: Hi, good morning. Thanks, Laura and Dale, and congratulations on the first commercial shipments of SimVest. I was hoping to just ask a couple of questions on the U.S. launch.

Josh Jennings: Hi, Good morning, Thanks, Laura deal and congratulations on the first commercial shipments of some of this.

Speaker Change: I was hoping to just ask a couple of questions on the U S launch.

Laura Niklason: We have had three hospitals that have approved CIMVAS for use, and I wanted to just better understand the characteristics of those three hospitals and what drove that really fast approval timeline, and then do you expect more of the same as you move through some of these other 31 VAC processes that are in play? Well, I think the what speeds the VAC process, thanks for the question, Joss, you know, what speeds the VAC process is either a VAC that's committed to improving patient care and getting the best products on their shelf, or and or, you know, having one or two surgeon champions at the institution who very much want to bring it into the hospital.

Josh Jennings: Three hospitals that have.

Speaker Change: Approved sympathy for Houston.

Speaker Change: Wanted to just better understand the characteristics of those three hospitals on what drove that.

Speaker Change: Really fast approval time line.

Speaker Change: And then just do you expect more of the same as you as you move through some of these other 31 vac processes that are in play.

Speaker Change: Well I think the.

Josh Jennings: What speeds the vac process. Thanks for the question Josh.

Speaker Change: What speeds the vac process is either.

Josh Jennings: That's committed to improving patient care and getting the best products on their shelf.

Josh Jennings: Or and or you know, having one or two surgeon champions at the institution, who very much want to bring it into the hospital. So you know this is a small N, but I can tell you that our vac approvals or at let me think about this.

Laura Niklason: So, you know, this is a small N, but I can tell you that our VAC approvals are at, let me think about this, at two hospitals that, no, actually one hospital that participated in our clinical trials, in our trauma trial, one hospital that did not participate in our trials, but where there was a compassionate use case, where the vascular surgeon felt strongly that that his patient retained her limb because of our vessel. And so that was actually our first VAC approval. And then there was another VAC approval in an institution where actually CINVAS has not been used before, but where one of the senior vascular surgeons had seen the data and was really found it very compelling and moved quickly to get it on the shelf.

Josh Jennings: At two hospitals that.

Josh Jennings: No actually one hospital that participated in our clinical trials in our trauma trial, one hospital that did not participate in our trials, but where there was a compassionate use case, where the vascular surgeon and felt strongly that that his patient retained her limb because of our vessel and so that.

Josh Jennings: It was actually our first step back approval and then there was another vac approval in an institution, where actually since this has not been used before but we're one of the seniors vascular surgeons had seen the data and was really founded very compelling and moved quickly to get it on the shelf. So so it's it's different it's different scenarios.

Laura Niklason: So it's different scenarios, but in general, what we're finding is that our investigators and also our compassionate use investigators, of which there are many, you know, we've done 30 compassionate use cases all over the country. And also, just as surgeons who are paying attention to the literature, I think there's a lot of enthusiasm across those three groups, and I'm hoping that that will continue to drive rapid VAC approval.

Josh Jennings: But in general what we're finding is that our our investigators.

Josh Jennings: And also our compassionate use investigators of which there are many you know we've we've done 30 compassionate use cases, all over the country.

Josh Jennings: And also just just at the surgeons, who are who are paying attention to the literature I think there's a lot of enthusiasm across those three groups and I'm, hoping that that will continue to drive rapid vac approvals.

Laura Niklason: Great. And I don't know if you're willing to share. Sorry, Josh. I was also going to point out that one of the first two hospitals ordering has still has the VAC process underway, but elected to order anyway to be able to treat cases while the VAC review was ongoing.

Josh Jennings: Great and I don't know if youre willing to share with you Josh I'm sorry, Jeff.

Speaker Change: Sorry, Josh I was also going to point out that one of the first two hospitals ordering tests still has the vac process underway, but elected to order any way to to be able to treat cases as well, but the back review was ongoing.

Josh Jennings: Excellent.

Laura Niklason: And I don't know if you're willing to share maybe some high level kind of colors of the goals for the launch this year 2025 in terms of just how many trauma centers do you expect to have your all-star sales team kind of engage and then get a VAC process initiated or even achieve VAC approval. I know it's a concentrated market. You guys were already off to a pretty strong start with 34. Well, I hesitate to give guidance on this topic because as soon as I say it, I know that it will be wrong, Josh. But I will give you estimates with the statement that this is not intended to be guidance.

Josh Jennings: Excellent.

Speaker Change: You'll note, we're willing to share maybe some high level kind of closure.

Speaker Change: Goals for our launch this year 2025 in terms of just how many trauma centers do you expect to have your all star sales team kind of engage and get it back process initiated or even a few vac approvals.

Speaker Change: It's in traded market. When you guys were already off to a pretty strong start with 34.

Josh Jennings: Well I hesitant to give guidance on this topic because it ensures that as soon as I say it I know that it will be wrong, Josh, but I will give you estimates.

Josh Jennings: Hum at with the with the statement that this is not intended to be guidance. What I can tell you is that over the last several weeks, we've added two or three or four vac processes.

Laura Niklason: What I can tell you is that over the last several weeks, we've added two or three or four VAC processes to our initiation pile every week. So if that rate were to continue, then by doing the math, many or the majority of level one trauma centers, we would have had at least initiated the VAC process by the end of the year. As far as number of conversions and how long those will take, it's very difficult to say because, you know, we only have three acceptances so far, although I think we're hearing about a couple more next week.

Josh Jennings: Two our initiation pile every week.

Josh Jennings: So if if that if that rate were to continue then by doing the math, many or the majority of level one trauma centers, where we would have had at least initiated the vac process by the end of the year.

Josh Jennings: As far as number of conversions and how long those will take it it's very difficult to say because you know.

Josh Jennings: Now we only have three acceptances, so far although I think we're hearing about a couple of more next week.

Laura Niklason: So far, the response, though, has been pretty good, so I would expect, I think this is a conservative expectation, that the majority of VACs would agree to bring the product onto the shelves. So, again, as we've messaged the market, this is a process that takes time. I think that the consensus among the analysts is that we will sell anywhere between, I think, $7 million and $13 million worth of product this year. You know, that's probably not too far off. I would also say that most of those sales are going to occur in the second half of the year just because of the realities of the time it takes to get through VAC meetings and approvals and then ordering.

Josh Jennings: So far they the response, though has been pretty good so I would expect.

Josh Jennings: I think this is a conservative expectation that the majority of Vacs would would agree to bring the product onto the shelves. So again as we've as we've messaged to the market are they said this is a process that takes time.

Josh Jennings: I think that the kids the consensus among the analysts is that we won't sell anywhere between I think seven and $13 million worth of product. This year, you know, that's probably not too far off.

Josh Jennings: I would also say that most of those sales are going to occur in the second half of the year just because of the realities of the time it takes to get through a vac meetings and approvals and then and then ordering.

Josh Jennings: So, we are clearly having a trickling of sales now. It'll be slightly more than a trickle in the second quarter, but the majority of it will be in the second half.

Josh Jennings: So we are clearly having a trickling of sales now it'll be slightly more than a trickle in the second quarter and but the majority of it will be in the second half.

Laura Niklason: I'll just take this opportunity, though, to speak more broadly to some projections that are in the market now from some analysts about our 2026 sales. I think that there was some earlier modeling that incorporated an expectation that we would be on the market with AV grafting in dialysis sometime in 2026. We now know that that's no longer true because our plan now is to file our supplemental BLA in dialysis in the second half of 2026, which would mean sales wouldn't hit until 2027. So I'd be happy to discuss with analysts and kind of recalibrate where we think these approvals are going to march out and then in that way recalibrate anticipated revenues in the out years.

Josh Jennings: You know I do think there I'll just take this this opportunity though to speak more broadly to some projections that are that are in the market now from some analysts about our 'twenty 'twenty six sales and and I think that there was some earlier modeling that incorporated an expectation that we would.

Josh Jennings: Beyond the market with it with AZ grafting and dialysis sometime in 2026, we now know that that's no longer true you know because we are our plan now is to file our supplemental BLA in dialysis in the second half of 2026, which would mean sales wouldn't hit until 2027, so I I'd be happy to discuss with analysts.

Josh Jennings: You know when kind of recalibrate, where we think these approvals are going to are going to March out and then in that way recalibrate, our anticipated revenues in the out years.

Josh Jennings: Understood. Thanks for that.

Josh Jennings: Understood Thanks for that.

Laura Niklason: And lastly, there was a controversial article published earlier this week, Humacyte issued a response yesterday. I was hoping maybe you could share, Laura, just some of the surgeon feedback you received this week, either from the investigators or from some of these surgeon champions that are trying to get CMS approved at their hospitals through the VAC process. Thanks for taking all the questions. Yeah, Josh, thanks for that question. So, you know, I will say that several of our surgeons who participated in our trauma trials were incensed. I think that's probably the right word at the article which they felt was biased.

Josh Jennings: And lastly, there was a controversial article published.

Speaker Change: This week she was site.

Speaker Change: Good response yesterday I was hoping maybe you can share or just some of the <unk>.

Speaker Change: Surgeon feedback you received this week.

Speaker Change: From the investigators or from from some of these surgeon champion Center.

Speaker Change: So must approve it or hospitals through the vac process. Thanks for taking all the questions.

Speaker Change: Yeah, Josh Thanks for that question. So you know I will say.

Speaker Change: At several of our surgeons, who participated in our trauma trials, where.

Speaker Change: Incensed I think that's probably the right word at the article which they felt was biased.

Laura Niklason: and Inaccurate. Several very prominent surgeons, who I'm not going to name here, drafted a rebuttal letter to the New York Times that was sent the next day on Tuesday. The New York Times did not publish this. We've waited several days and have prompted them, but my anticipation is that they will not publish the rebuttal from the surgeons who have actually used the product in trauma patients. So our plan is to issue this letter into the public domain in some form that the surgeons are comfortable with. You know, again, this is a letter coming from the surgeons at major medical centers that treat a lot of trauma, and this is really their call.

Speaker Change: And inaccurate.

Speaker Change: Several very prominent surgeon, so I'm not going to name here drafted a rebuttal letter to the New York Times that was sent the next day on Tuesday.

Speaker Change: The New York Times did not publish this.

Speaker Change: We've waited several days and have prompted them, but I my anticipation is that they will not publish the rebuttal from the surgeons, who have actually use the product in trauma patients.

Speaker Change: So our plan is to issue. This issue this letter into the public domain in some form that that the surgeons are comfortable with you know again. This is this is a letter coming from these surgeons at major medical centers that treat a lot of trauma.

Speaker Change: And this is really their call, but I wouldn't say I would say incensed is it's a really good word to him.

Laura Niklason: But I would say incensed is a really good word to characterize their response.

Speaker Change: <unk> characterized their responses.

Josh Jennings: Great, thanks you guys.

Heiko: Alright, Thanks Heiko.

Speaker Change: Thank you.

Ryan Zimmerman: The next questions are from the line of Ryan Zimmerman with BTIG. Good morning, Laura, Dale. Thanks for taking our questions, and congrats on this early progress, commercially. It's exciting to see. I want to follow up on some of Josh's questions here, but I want to actually focus on the V012 trial first, and you have an interim analysis potentially coming pretty quickly, just based on the enrollment pace. And so remind us what we're looking for there, what you'd consider success on that interim analysis, and then the timing for the combined VLA supplement and V012 and V007.

Speaker Change: The next question is from the line of Ryan Zimmerman with BTG. Please proceed with your questions.

Speaker Change: Good morning, Laura Dale Thanks for taking our questions.

Speaker Change: Congrats on this early progress.

Speaker Change: Progress commercially it's exciting to see.

Josh Jennings: Wanted to follow up on southern Josh is questions here.

Speaker Change: But I wanted to actually focus on.

Speaker Change: The V O 12 trial first and you have an interim analysis potentially come in.

Speaker Change: Pretty quickly just based on the enrollment pace and so remind us what we're looking for there.

Speaker Change: What you would consider success on that interim analysis.

Speaker Change: And then the timing for that.

Speaker Change: The combined.

Speaker Change: All a supplement and V O 12 and V O seven thank you.

Laura Niklason: Thank you. Yeah, Ryan, thanks for that question. Um, so, so the VO-12 trial, we started about a year, year and a half ago, because even at that time, it had become clear to us that our vessel might offer real benefits for women in particular. Um, and, uh, and The number of patients that were women that were enrolled in our VO7 trial was actually pretty small. So, you know, as you and I have discussed before, women have smaller veins than men do. And when you sew an artery and a vein together to make a fistula, that vein has to dilate up to 6 or 7 millimeters.

Speaker Change: Yeah, Ryan Thanks for that question. So so the V. O 12 trial, we started about a year year and a half ago.

Speaker Change: Because even at that time, it had become clear to us.

Speaker Change: Or vessel might offer real benefits for women in particular and Ah and.

Speaker Change: The the number of patients that more women that were enrolled and in RVO seven trial was actually pretty small. So you know as you and I have discussed before.

Speaker Change: Women have smaller veins than men do and when you're selling the artery and a vein together to make officials that vein has to die laid up to six or seven centimeter millimeters.

Laura Niklason: If you're a woman with small veins of 2 millimeters, that's pretty hard. It's a lot harder than if you're a man with a vein of 4 or 5 millimeters. So, you know, historically, surgeons have always known that women have a hard time with fistula maturation. But still, many fistulas are put into women because it's the standard of care. They believe that if the fistula does mature, that the patient will do well. But the fact is, many don't, and these women are stuck on catheters for long periods of time, and that's dangerous and costly. So we initiated this trial, again, more than a year ago, and the end point is.

Speaker Change: If you're a woman with small veins of two millimeters, that's pretty hard it's a lot harder than if you're a man with a vein of four or five millimeters.

Speaker Change: So you know historically surgeons have always known that women have a hard time with fischler maturation, but still many officials are put into women because it's the standard of care and that they believe that if the official it does mature that are that the patient will do well, but the fact is many don't and these these women are stuck on catheters for long.

Speaker Change: It's a time and that's a dangerous and costly.

Speaker Change: So we initiated this trial again more than a year ago and the endpoint is.

Laura Niklason: actually catheter-free days during the first year. So, the goal is to establish dialysis access as quickly as possible and to maintain it so that these women can get catheters out of their necks and can avoid septic episodes and hospitalizations. So, that's our endpoint. It's a clinically very meaningful endpoint. It's the endpoint that nephrologists are thinking about most closely right now. And it also pertains to how reimbursement works in dialysis access centers right now because dialysis centers are graded by CMS by how many catheter patients they have. And the fewer catheter patients, the better the reimbursement for dialysis because CMS understands that getting catheters out of patients is really important.

Speaker Change: Actually catheter free days during the first year. So the goal is to establish a dialysis access as quickly as possible and to maintain it. So that these women can get catheters out of their next and can avoid septic episodes and hospitalizations. So that's our endpoint, it's a clinically very.

Speaker Change: Meaningful endpoint, it's the endpoint that nephrologist start thinking about most closely right now.

Speaker Change: And it also pertains to how reimbursement works.

Speaker Change: In dialysis access centers right now because dialysis centers are graded by CMS by how many catheter patients they have and the fewer catheter patients the better the reimbursement for dialysis, because CMS understands that getting catheters out of patients is really important.

Laura Niklason: So we are going to, again, we're four patients away from our 80 patient enrollment for the interim analysis. Of course, we're gonna continue enrolling. We're not gonna stop enrolling, but we are gonna make a cut at 80. And then one year after that, we'll get the top line data. We expect those data to be positive based on data in women that we've already seen in our other trials. So we expect this to be positive. And if it is, then it would support a supplemental BLA along with VO7.

Speaker Change: <unk>.

Speaker Change: So we're going to again, we're a four patients away from our 80 patient enrollment for the interim analysis of course, we're going to continue enrolling we're not going to stop enrolling, but we are going to make a cut at 80 and then one year after that we will get the topline data.

Speaker Change: We expect those data to be positive based on our data and women that we've already seen in our other trials. So we expect this to be positive and if it is then it would support a supplemental BLA along with V O seven.

Speaker Change: Right.

Laura Niklason: Okay, very, very helpful. And then, you know, On the article, and again, not to harp on it, I thought the response last night was important. One of the things I was curious if you could talk about is just your supplement for the BLA with CIMBAS. And is it the same review team that looked at it for vascular trauma, their familiarity with it, their comfort with it? It would seem to suggest that they're very aware of kind of the first trial as you pursue additional indication. Well, I think there is some overlap with With the clinical review teams, I'm sure that they're not identical.

Speaker Change: Okay very helpful and then.

Speaker Change: On the article.

Speaker Change: Again not to harp on it.

Speaker Change: I thought the response last name was imported one of the things I was curious if you could talk about is just your supplement for the BLA with symbols and.

Speaker Change: Is it the same review team.

Speaker Change: That looked at it for vascular trauma.

Speaker Change: Their familiarity with it they are comfort with it.

Speaker Change: It would seem to suggest that they are very aware of kind of the first trial as you pursue additional indications.

Speaker Change: Well I think there is some overlap with.

Speaker Change: With the clinical review teams I I'm sure that they're not identical. So for example, there are several nephrologist on the clinical review team right now at Seeber.

Laura Niklason: So, for example, there are several nephrologists on the clinical review team right now at CBER. And I would expect that those clinical nephrologists would take a larger role in review of our supplement and dialysis than they did in the review of our trauma application. I don't know this, but I'm assuming that that will be the case. So, but many of these folks were present. You know on on many of our meetings and obviously we're part of the deliberations with CIMVAS. You know, I think it's important, you know, with respect to the article and the dissent by Dr. Lee, who is not in the Center for Biologics, he's retired now, but he was in the Center for Devices, and he was just a consultant.

Speaker Change: And I would expect that those clinical nephrologist would take a larger role in review of our supplement in dialysis than they did in the review of our of our trauma application I don't know this but I'm assuming that that will be the case.

Speaker Change: So but many of these many of these folks were present.

Speaker Change: You know on on many of our meetings and obviously, we're part of the deliberations and with <unk>.

Speaker Change: I think it's important you know with respect to the article and the defense by Doctor Lee who is not in the center for biologic seats. He's retired now but he wasn't the center for devices and he was just a consultant.

Laura Niklason: You know, it's important to note that that during the four and a half months that his comments were being weighed and considered and evaluated and discussed. Where CBER came out at the end in December was that the label and the indication and the warnings were identical verbatim. to what we had negotiated with them back in August before our PDUFA date. Not one word was changed in our label. So there was a four-and-a-half-month delay, but it did not change the final conclusions of the review team at all.

Speaker Change: It is important to note that during the four and a half months that his comments were being weighed and considered and evaluated and discussed.

Speaker Change: Where were see Berke came out at the end in December was that the label and the indication and the warnings were identical verbatim.

Speaker Change: To what we have negotiated with them back in August before our <unk> date.

Speaker Change: Not one word what's changed in our label. So there was a four and a half months delay, but it did not change the final the final conclusions of the of the review team at all.

Ryan Zimmerman: Yeah, that's an important point, Laura. I appreciate you calling that out.

Speaker Change: Yes.

Speaker Change: It's an important point Laurie I appreciate you, calling that out and then if I could sneak one more in for Dale.

Dale Sander: And then if I could sneak one more in for Dale. Costs stepped down just a hair on the R&D line, Dale, this quarter. Any comments or, you know, thoughts around expense guidance for 2025? Maybe not even guidance, but just kind of, you know, with the clinical trials that are ongoing, kind of how to think about maybe some of your R&D costs in 2025? Yeah, I think it's a fair point. Ryan, as you as you point out, we haven't given guidance. But you know, we've, I think, indicated directionally where R&D can and should go during the year.

Speaker Change: It costs stepped down just a hair on the R&D line sale this quarter.

Speaker Change: Any comments or.

Speaker Change: Costs around expense guidance for.

Speaker Change: For 2025, maybe not even guidance, but just kind of.

Speaker Change: With the clinical trials that are ongoing and kind of how to thinking about maybe some of your R&D costs and 25.

Speaker Change: Yeah, I think it's a fair point Ryan as you pointed out we haven't given guidance, but I.

Speaker Change: And I think you indicated directionally, where R&D can and should go during the year.

Dale Sander: In general, there'll be somewhat of a ramp down in R&D expenses really driven by two items. One is, you know, we have a pretty significant wind down of trauma, clinical trial expenses, there's some long term follow up. But you know, those Trials are on their tail end. The costs are reduced compared to prior years. VO7 will be winding down also. And so that leaves VO12 as kind of the principal, still-enrolling trial that drives the majority of clinical costs. So to kind of wind down the trials brings down the R&D costs. The other factor that brings down the R&D costs is that, you know, historically through the end of 2024, anything related to manufacturing flowed through into R&D.

Speaker Change: In general there'll be somewhat of a ramp down in R&D expenses really really driven by two items one is.

Speaker Change: We have a pretty significant wind down of trauma clinical trial expenses. There. There's some long term follow up but those.

Speaker Change: Those trials are on the tail end and.

Speaker Change: The costs are reduced compared to prior years.

Speaker Change: D O seven will be winding down also.

Speaker Change: And so that leaves 12 is kind of the principle still enrolling trial that drives the majority of clinical costs. So as we kind of wind down the trials brings down the R&D costs.

Speaker Change: The other factor that brings down the R&D cost is that.

Speaker Change: Historically through the end of 2024.

Speaker Change: Anything related to manufacturing.

Speaker Change: Flow through into R&D.

Dale Sander: And, you know, as you know, Our manufacturing system, it's biologic manufacturing. It's living organism. It's not just, you know, equipment and facilities, but it's people. And to have a manufacturing system, it has to be out there producing. And so all those costs historically have flowed into R&D, where sales ramp up, you know, those costs that previously were expenses, R&D, will start flowing into inventory and cost of sales that will further reduce the R&D spend.

Speaker Change: And.

Speaker Change: And as you know.

Speaker Change: Our manufacturing system its biologic manufacturing, it's a living organism, it's not just.

Speaker Change: Equipment and facilities, but its people in and to have a manufacturing system. It has to be out there producing.

Speaker Change: And so all those costs historically have flown into R&D, where.

Speaker Change: Sales ramp up those.

Speaker Change: Those costs that previously were expenses R&D will start flowing into inventory and cost of sales that will further reduce the debt.

Unknown Attendee: For more information, visit www.FEMA.gov Okay.

Speaker Change: R&D spend.

Unknown Attendee: Appreciate that.

Speaker Change: Okay I appreciate it.

Unknown Attendee: Thanks for taking the question.

Speaker Change: Thanks for taking the questions.

Unknown Attendee: Thank you.

Kristen Kluska: The next questions are from the line of Kristen Kluska with Kander Fitzgerald. Hi, and good morning. This is Ayaan on Kristen's line. Our question is on the PAD program. Any thoughts on the timeline for the Phase 3 trial? And you previously mentioned needing to improve your cash position to proceed with this trial. So I guess we're wondering how much investment is required here to expand the ATA label to the PAD indication. Thank you for taking our question. So, yeah, thank you. Thank you for that question.

Speaker Change: Thank you. The next questions are from the line of Kristen Cuzco with Cantor Fitzgerald. Please proceed with your questions.

Speaker Change: Hi, Good morning. This is Ian I'm questions line of question is on the pod program any thoughts on the timeline for the phase three trial in <unk>.

Speaker Change: You previously mentioned needing to improve your cash position to proceed with this trial. So I guess, what I'm wondering how much investment is required here to expand that <unk> label to the pod indication. Thank you for taking our question.

Speaker Change: So yeah. Thank you. Thank you for that question I'm I'm gonna be Wishy washy on this because this is still something that we're trying to sort out based on our phase two studies in 80 or 90 patients. We believe strongly that there is a terrific market for our vessel in.

Laura Niklason: I'm going to be wishy-washy on this because this is still something that we're trying to sort out. Based on our phase two studies in 80 or 90 patients, we believe strongly that there is a terrific market for our vessel in PAD, particularly in patients with critical limb ischemia who have no vein and who need revascularization below the knee. There are tens of thousands of these patients every year in the U.S., many of whom go on to amputation. And I believe that real clinical benefits could be provided by our vessel. That said, we are continuing to design the phase three trial.

Speaker Change: P E D, particularly in patients with critical limb ischemia, who have no vein and who need revascularization below the knee. There are tens of thousands of these patients every year in the U S. Many of whom go onto amputation and I believe that real clinical benefits could be provided by our vessel.

Speaker Change: That said, we are continuing to design the phase III trial, we do not we do not plan an enormous trial. Our goal is to do a small trial with a very clearly defined endpoint.

Laura Niklason: We do not we do not plan an enormous trial. Our goal is to do a small trial with a very clearly defined endpoint. But that said, I think we do have to evaluate our cash position right now, you know, as is in the public domain. We did do a recent raise, which was terrific. But we're going to sit back and look at our priorities and timing. So, you know, we are fully committed to pursuing the PAD program. We think it's vitally important for patients and for the company, and surgeons have been clamoring for it for years.

Speaker Change: But that said I think we do have to evaluate our cash position right. Now you know as you know as as is in the public domain. We did do a recent raise which was terrific.

Speaker Change: But we're going to sit back and look at our priorities and timing. So you know we are fully committed to pursuing the P. E. D program. We think it's it's vitally important for patients and for the company and surgeons have been clamoring for it for years, but but we will continue to evaluate our cash position.

Laura Niklason: But we will continue to evaluate our cash position and our longer-term spend and decide on timing at that point. Thank you for that caller.

Speaker Change: And our longer term spend and and decide on timing at that time.

Speaker Change: Thank you for that color.

Unknown Attendee: Thank.

Speaker Change: Thank you.

Vernon Bernardino: Our next question comes from the line of Vernon Bernardino with H.C. Wainwright. Please receive your question. Hi, Laura and Dale. Thanks for taking my questions and congratulations again on the approval and the launch. 20 years is a long time. Great perseverance. Regarding the VAC process, again, visiting this, you mentioned that the hospitals in the process are a mix of leading trauma centers that were participants in the clinical trials, and then also individual institutions. Could you describe for us how those, I guess, different types of institutions are detailed by the Salesforce? What kind of education? process they may have, especially institutions that have been newly introduced to Symbeth.

Speaker Change: Next question comes from the line of Vernon Bernardino with H C. Wainwright. Please proceed with your question.

Speaker Change: Hi, Lauren.

Vernon Bernardino: Thanks for taking my questions.

Vernon Bernardino: Congratulations again on the approval and launch.

Vernon Bernardino: 20 years is a long time and.

Vernon Bernardino: That's great perseverance.

Vernon Bernardino: The regarding the <unk>.

Vernon Bernardino: That process again visiting this.

Vernon Bernardino: You mentioned that the hospitals.

Vernon Bernardino: In the process are a mix of leading trauma centers that were participants in our clinical trials and then also individuals institutions could you.

Vernon Bernardino: Describe for us.

Vernon Bernardino: How those.

Speaker Change: Okay different types of institutions are detailed by the sales force you know what kind of education.

Vernon Bernardino: Yeah.

Vernon Bernardino: Process, they may have especially.

Vernon Bernardino: Institutions have been newly introduced to <unk>.

Laura Niklason: Right. Yeah, that's, Vernon, that's a great question. So we don't have a huge sales force. It's 10 sales executives, plus a few managers and instructors who also build out the team. But you know, we have spent one of the few good things about the FDA delay last fall was that we brought on our sales team on August 12, because we fully believed we were getting approval on August 12. So we hired our people August 12. They came in. So they had a long time to get educated on the technology, on how the vessel is made, how it works, how it functions in the patient, the biological responses, the durability.

Brian: Right Yeah, that's Brian that's a great question. So we don't have a huge sales force. It's it's 10, our sales executives plus plus a few managers and instructors who who also built out the team, but you know we have spent one one.

Vernon Bernardino: The one of the few good things about the F D a delay.

Vernon Bernardino: Last fall was that we brought on our sales team on August 12th because we.

Vernon Bernardino: We believe we were getting approval on August 9th So we hired our people August 12th they.

Vernon Bernardino: They came in so they had a long time to get educated on the technology.

Vernon Bernardino: How the vessel has made how it works how it functions in the patient the biological responses. The durability. So they became very very.

Laura Niklason: So they became very, very steeped in the science and the surgery and the medicine of our product before they had to go out and approach surgeons about it. They also had, you know, a number, more than 1500 touchpoints during the fall, with both surgeons in their territories, at major medical centers, but also hospital personnel to sort of set the stage for when SimVest was eventually approved in December. So as far as the education, you know, I think that the education, obviously, you know, it's a combination of the sales force, which educates, you know, by law, with respect to the label.

Vernon Bernardino: Steeped in the science and the surgery and the medicine of our product before they had to go out and approach surgeons about it. They also had you know on a number more than 1500 touch points during the fall with both surgeons in their territories.

Vernon Bernardino: At major medical centers, but also a hospital personnel.

Vernon Bernardino: To sort of set up set the set the stage for win since that's what eventually approved in December.

Vernon Bernardino: So as far as the education, you know I think that the education. Obviously, you know it's a combination of the sales force, which educates you know by law with respect to the label.

Laura Niklason: So our sales executives can teach only to the label. But in addition, we have medical affairs specialists, many of whom are MDs and PhDs, all of whom are MDs and or PhDs. And they can also accompany our sales executives and teach surgeons who are unfamiliar with the product on the underlying biology, but also on our published clinical trial results. So, for the uninitiated surgeon, I think we have sort of a one-two punch. We have a two-pronged team to educate the surgeon on the technology and the label and also the published clinical results. And the last thing I'll add is that as we go through these VAC processes, especially since our budget impact model was just recently published a couple weeks ago in the Journal of Medical Economics.

Vernon Bernardino: So our sales executives can teach only to the label but in addition, we have our medical affairs specialists, many of whom are Mds and Phds all of whom are Mt's <unk> ph D. M and they can also accompanying our sales executives and teach.

Vernon Bernardino: Surgeons, who are unfamiliar with the product.

Vernon Bernardino: On on the the underlying biology, but also on our published clinical trial results.

Vernon Bernardino: So for the uninitiated surgeon I think we have a we have sort of a one two punch we have a we have a two pronged team to educate the surgeon on the on the technology and the label and also the published clinical results.

Vernon Bernardino: And the last thing I'll add is that as we as we go through these V. A C processes.

Vernon Bernardino: Especially since our budget impact model was just recently published a couple of weeks ago and the journal of medical Economics.

Laura Niklason: We now have excellent tools to educate surgeons and VAC committees on the financial impacts for the hospital of bringing SimVets into the mix for their trauma patients. And so we also take active roles in educating surgeons and VAC committee members on what the model means and what it can mean for hospitals in terms of cost savings. So it is a real education. I mean, everything about Humacyte has been an education. But the one area, I'll finish, the one area that actually doesn't need a lot of education is how to handle the vessel. The biggest part of educating on CIMVS is educating the surgeon on how to get it out of the bag.

Vernon Bernardino: We're now we now have excellent tools to educate surgeons and Vac committees.

Vernon Bernardino: On the the financial impacts for the hospital of bringing <unk> into the mix for their trauma patients.

Vernon Bernardino: And so we also take active roles in educating surgeons and Vac Committee members on what the model means and what it can mean for hospitals in terms of cost savings. So it is a real education I mean, everything about human side has been an education.

Vernon Bernardino: But I the one the one area I'll finish the one area that actually doesn't need a lot of education is how to handle the vessel you know once that the biggest part of educating on an inverse is educating the surgeons on how to get it out of the bag.

Vernon Bernardino: Because most surgeons, once they put a couple stitches in it they feel very comfortable and there's not a huge training process for the implantation. Thanks for that. It's a testament, I think, to your faith and your sales team. If I were on the team back in August, I might have started to worry as the approval took longer and longer.

Vernon Bernardino: Because most surgeons once they put a couple of stitches in it they feel very comfortable and there's not a huge training process for the implantation.

Vernon Bernardino: Okay.

Vernon Bernardino: Thanks for that.

Vernon Bernardino: Testament, I think to your face and your sales team.

Vernon Bernardino: If I were.

Vernon Bernardino: On the team back in August I might have started to worry as the approval took longer and longer.

Laura Niklason: A second question I had is with the supplemental DLA plan to submit for ATF or DAS second half 2026. If the supplemental DLA, would the approval take less time than it would have for the FDA's review for ATF and vascular trauma? Well, I certainly hope so. I mean, the time from our submission to approval was more than 12 months. It exceeded even a standard approval timeline. So I would certainly hope that it would be shorter. The standard, actually, the standard review time for a supplemental BLA, I believe, is nine months. We will apply for an accelerated review, a priority review.

Vernon Bernardino: Second question I had is with the supplemental BLA.

Vernon Bernardino: Our plan to submit.

Speaker Change: For a tougher second half 2026.

Vernon Bernardino: If the supplemental bill would.

Speaker Change: The approval will take less time than.

Vernon Bernardino: It would have four.

Vernon Bernardino: The Fda's review for.

Vernon Bernardino: Hey, Jonathan vascular trauma.

Speaker Change: Well I certainly hope so I mean, the time from our submission to approval with more than 12 months. It exceeded even our standard approval timeline. So I would certainly hope that it would be shorter the standard actually it's up to the standard review time for a supplemental BLA I believe it's nine months.

Speaker Change: We will apply for an accelerated review a priority review, we don't know if we'll get that and even if we do get it we don't know if those timelines will be followed so I I.

Laura Niklason: We don't know if we'll get that. And even if we do get it, we don't know if those timelines will be followed. So I long ago gave up predicting how long it's going to take the FDA to do something. I do know that they're very thorough and they take their own timelines. So I won't speculate further. Yeah, I just thought I'd ask.

Speaker Change: Long ago gave up predicting how long it's going to take the FDA to do something I do know that they are very thorough and they and they take their and they take their own timeline. So I won't speculate further.

Speaker Change: Yeah, I just thought I'd ask a last question I have.

Laura Niklason: Last question I have, and I apologize for so many follow-ups. Regarding the small diameter ATEV for a CABG, and I apologize for not having insight in this, will the manufacturer of that size ATEV be just about the same cost as a manufacturer of the size used for vascular trauma? That's a very good question. So in general, so there's a couple aspects to the answer. The first answer is that the large equipment that we use, the Luna 200s that we've built and installed are all, can all be converted over to cabbage grafts if we wanted to.

Speaker Change: Apologize for.

Speaker Change: So many follow ups regarding the small diameter itself for a cabbage.

Speaker Change: And I apologize for not having insight in this or the manufacturer of that size.

Speaker Change: B just about the same cost.

Speaker Change: Manufacturer.

Speaker Change: It's used for vascular trauma.

Speaker Change: That's a very good question.

Speaker Change: So in general.

Speaker Change: The the <unk>.

Speaker Change: So there's a couple of aspects to the answer that the first answer is that the large equipment that we use the lunar two hundreds that we've built and installed.

Speaker Change: Our all it can't all be converted over to to cabbage graph. If we wanted to we would never do that but my point is is that it's the same equipment. We don't have to build new equipment in order to make the smaller caliber and shorter graphs, we need smaller caliber and shorter plastic bags that are easy to make and then we installed them in these.

Laura Niklason: We would never do that, but my point is that it's the same equipment. We don't have to build new equipment. In order to make the smaller caliber and shorter grafts, we need smaller caliber and shorter plastic bags that are easy to make. And then we install them in these machines. So in general, the cost of It doesn't perfectly scale, but there's an approximate scale of the cost of production. with the mass of the tissue that's made. So, yes, to your point, we believe that the cost to us of producing a 3-millimeter vessel that's only 20 centimeters long will be less than the cost of producing a 6-millimeter vessel that's 40 centimeters long.

Speaker Change: Machines.

Speaker Change: So in general, but the cost of.

Speaker Change: It it doesn't perfectly scale, but there is an approximate scale of the cost of production.

Speaker Change: With the massive the tissue that's Nate so yes to your point, we believe that the cost or the cost to us of producing a three millimeter vessel. That's only twice to make 20 centimeters long will be less than the cost of producing a six millimeter vessel. That's 40 centimeters long I can't give you a number as far as how much less it will cost us I just.

Vernon Bernardino: I can't give you a number as far as how much less it will cost us. I just haven't done that math. But it will be less costly to produce. Appreciate the insight and thanks for taking my questions and congratulations again on this investment.

Speaker Change: Haven't done that math, but it will be less costly to produce.

Speaker Change: I appreciate the insight and thanks for taking my questions and congratulations again on the same best launch.

Unknown Attendee: Thank you.

Speaker Change: Thank you. The next question is from the line of Bruce Jackson with the Benchmark Company. Please proceed with your questions.

Bruce Jackson: The next question is from the line of Bruce Jackson with the Benchmark Company. I look forward to seeing you through questions. Hi, good morning and congratulations on all of the progress. Just one question for me on the pipeline. Can you give us a quick update on the biovascular pancreas project? Yes, so you have to be careful about what's in the public domain and what's not. So we are continuing primate work in the biovascular pancreas. We have shown most recently that islets survive not just for weeks but for months, and they continue to produce insulin that's detected in the bloodstream.

Bruce Jackson: Hi, good morning, and congratulations on all over the progress just one question for me on the pipeline.

Bruce Jackson: Could you give us a quick update on our bio vascular pancreas project.

Bruce Jackson: Yes, so have to be careful about what's in the public domain and what's not so we are continuing primate work in the bio vascular pancreas. We have shown most recently that I, let survive not just for weeks, but for months and they.

Bruce Jackson: Continue to produce insulin that's detected in the bloodstream and we've we've detected this insulin in the bloodstream even in diabetic primates. So we have one diabetic primate that's being treated with our BV P. Right now and we have seen some therapeutic impact of our implant where we're at a phase now where we're sort of tweaking.

Laura Niklason: And we've detected this insulin in the bloodstream even in diabetic primates. So we have one diabetic primate that's being treated with our BVP right now, and we have seen some therapeutic impact of our implant. We're at a phase now where we're sort of tweaking the composition. What I believe the data that we've shared so far has proven is that our BVP can keep islets alive for three or six months or longer. And if they can keep, if they stay alive for three or six months or longer, they're going to stay alive forever. I mean, if they live for three months, they're not going to die of hypoxia at month four.

Bruce Jackson: The competition.

Bruce Jackson:

Bruce Jackson: What I believe the data that we've shared so far has proven out is that our BV P can keep eyelets alive for three or six months or longer and if they can if they stay alive for three or six months or longer.

Bruce Jackson: Gonna stay alive Forever, I mean, they're not if they live for three months, they're not they're not gonna die of hypoxia at month for so so long term in grassman I believe we've shown.

Laura Niklason: So long-term engraftment, I believe we have shown. We've also shown long-term insulin production. And these were the two key sort of technological hurdles that we had to prove to ourselves. And I think that we've proven them. So we are now tweaking the design and the dosing. to ensure that we can get the maximal therapeutic effect. So I'm encouraged by the fundamentals of what we're seeing in the primate study.

Bruce Jackson: We've also shown long term insulin production.

Bruce Jackson: And these were the two key sort of technological hurdles that we had to prove to ourselves.

Bruce Jackson: And I think that we've proven those so we are now tweaking the design and the dosing.

Bruce Jackson: To ensure that we can get the maximum therapeutic effect. So I'm I'm encouraged by the fundamentals of what we're seeing in the primate studies.

Bruce Jackson: Yeah.

Bruce Jackson: Okay, great. Thank you very much. That's it for me. Thank you.

Speaker Change: Okay, great. Thank you very much that's it for me.

Speaker Change: Thank you at this time, we've reached the end of our question and answer session and I will also conclude today's teleconference.

Operator: At this time, we've reached the end of our question and answer session, and I will also conclude today's teleconference. We thank you for your participation. You may now disconnect your lines at this time and have a wonderful day.

Speaker Change: <unk> you for your participation you may now disconnect your lines at this time and have a wonderful day.