Q2 2025 Humacyte Inc Earnings Call
Speaker #4: Good morning, ladies and gentlemen, and welcome to the Humacyte second quarter 2025 results conference call. Currently, all participants are in listen-only mode. Later, we will conduct a question-and-answer session, and instructions will follow at that time.
Speaker #4: As a reminder, this conference is being recorded. I would now like to turn the call over to Tom Johnson with Lifesight Advisors. Please go ahead.
Speaker #5: Thank you, operator. Before we proceed with the call, I'd like to remind everyone that certain statements during this call are forward-looking statements under U.S. federal securities laws.
Speaker #5: 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 factors that could cause actual results to differ from statements made on this call is contained in our periodic reports filed with the SEC.
Speaker #5: Before we look at statements made during this call, please note that the date hereof and the company undertakes no obligation to update or revise the forward-looking statements, except as required by law.
Speaker #5: Information presented on this call is contained in the press release we issued this morning and in our Form 10-Q, which, after the filing, may be accessed from the investor page of the Humacyte website.
Speaker #5: Joining me today on today's call from Humacyte are Dr. Laura Niklason, President and Chief Executive Officer; Dale Sander, Chief Financial Officer; and Chief Corporate Development Officer; and BJ Shesley, Chief Commercial Officer.
Speaker #5: Dr. Niklason will provide a summary of the company's progress for the quarter in recent weeks, and Dale will review the company's financial results for the quarter ended June 30, 2025.
Speaker #5: Following their prepared remarks, BJ will join Laura and Dale for the Q&A session. I'll turn the call over to Dr. Laura Niklason. Go ahead, Laura.
Speaker #6: Thank you, Tom. Good morning, everyone, and thank you for joining us for our second quarter 2025 financial results and business update call. Following the landmark success of obtaining FDA approval of SIMVEST for the treatment of extremity vascular trauma last year, we continue to execute on the commercial launch of this groundbreaking product.
Speaker #6: Progress during our second quarter and recent weeks was marked by continued expansion of our Value Analysis Committee, or VAC, approvals. This has led to a major expansion of the number of approvals that are now able to purchase SIMVEST.
Speaker #6: Recently, we also announced that the U.S. Defense Logistics Agency granted electronic catalog, or ECAT, listing approval to SIMVEST. Along with this, we have recorded our first sale to the U.S. to a U.S. military facility.
Speaker #6: We did encounter some headwinds during April and May due to unsubstantiated public attacks by certain detractors. However, we've seen an acceleration in VAC approval activity and commercial sales in June and July.
Speaker #6: Coupled with the continued advancement of our acellular tissue engineered vessel, or ATEV, in our pipeline programs, we believe that we’re positioned for growth and value generation in 2025 and beyond.
Speaker #6: During today's call, I'll review these developments in more detail before turning the call over to Dale Sander for a review of our financial results. BJ Shesley, our Chief Commercial Officer, will then join us to help answer your questions.
Speaker #6: We begin with our commercial launch of SIMVEST. We are pleased by the traction that we've continued to gain in our interactions with civilian hospitals. To date, a total of 13 organizations have completed the VAC process and have approved the purchase of SIMVEST.
Speaker #6: Because some of these VAC approvals include multi-hospital networks, a total of 82 civilian hospitals are now eligible to purchase SIMVEST. This is an enormous increase from the five civilian hospitals that were eligible to purchase SIMVEST at our last quarterly earnings call.
Speaker #6: Furthermore, an additional 40 VAC sites are currently conducting reviews of SIMVEST, and we expect that the number of hospitals eligible to purchase SIMVEST will continue to grow.
Speaker #6: After VAC approval, contracting and negotiations with each individual hospital are completed before sales and shipment to that hospital can commence. Currently, our sales team is actively targeting high-volume centers having VAC approval for contracting negotiations.
Speaker #6: July product sales of approximately 0.3 million exceeded the total sales recorded for the first half of the year. Additionally, in July, we announced that SIMVEST was awarded the electronic catalog (ECAT) listing approval from the U.S. Defense Logistics Agency.
Speaker #6: ECAT is an internet system that provides the Department of Defense and other federal agencies with access to manufacturers and, I'm sorry, distributors' products. The ECAT approval makes SIMVEST available to healthcare professionals treating military service members, veterans, and other patients receiving care at approximately 35 military treatment facilities and approximately 160 U.S. Department of Veterans Affairs hospitals.
Speaker #6: With ECAT approval in place, it's not generally necessary to also obtain VAC approval at the military treatment facilities or VA sites. Instead, purchases are facilitated directly through the ECAT system.
Speaker #6: Since obtaining ECAT approval just a few weeks ago, we've already recorded our first commercial sale to a U.S. military facility. This facility is a state-of-the-art medical complex.
Speaker #6: Located on a major U.S. military base, it provides healthcare to approximately 200,000 active-duty service personnel, retirees, and their family members. Subsequent to the initial shipment, this facility has also reordered SIMVEST.
Speaker #6: We have great interest in improving the medical options that are available to healthcare professionals who are treating military personnel and their families. And we're actively advancing our discussions with additional military treatment facilities.
Speaker #6: In August, we were notified that the Centers for Medicare and Medicaid Services, or CMS, declined to approve our application for the New Technology Add-On Payment, or NTAP, for SIMVEST.
Speaker #6: Our application was submitted in October of 2024. Along with the majority of applications that were submitted to CMS this cycle, our application was also denied.
Speaker #6: The reason provided by CMS was that SIMVEST does not have a unique mechanism of action as compared to veins or synthetic grafts, and therefore, it does not qualify for their newness criterion.
Speaker #6: This conclusion was extremely surprising to us. We believe that the potential impact of the NTAP on our commercial success is fairly limited because only about 4.3% of vascular trauma patients who fall within our approved indication are covered under Medicare reimbursement.
Speaker #6: Because private pay insurers are the most common source of reimbursement for vascular trauma patients that are falling within our indication, we're engaging in discussions with private payers about supplemental reimbursement for SIMVEST in the trauma indication.
Speaker #6: We believe that the results of our GET Impact model, or BIM, which we published several months ago, along with our published clinical trial results, will encourage supplemental reimbursement from private payers.
Speaker #6: I'll now turn to the ATEV program, which is our next priority: dialysis access for patients with end-stage kidney failure. We're pleased to see results from our V07 Phase III trial were presented in a plenary session at the Society of Vascular Surgery annual meeting in June.
Speaker #6: The V07 results presentation, which focused on patients at high risk of fistula non-maturation, was one of only three selected for special mention by the society in their own announcement.
Speaker #6: The V07 clinical trial enrolled a total of 242 patients, of which 110 were considered to be at high risk of fistula non-maturation. Among this high-risk cohort, functional patency at six months and secondary patency at 12 months were significantly higher in ATEV recipients as compared with fistula.
Speaker #6: The duration of access usability over the first year was also significantly higher in the ATEV group, at eight months, versus only four and a half months for arteriovenous fistula, with a P-value of 0.00002.
Speaker #6: Results of the V07 trial have also been accepted for presentation at the annual Kidney Week meeting for 2025 later this year. Women and men with diabetes and obesity make up more than half of the dialysis access market.
Speaker #6: Patients with a high risk of fistula non-maturation have historically been underserved by the current standard of care. Since waiting for fistula maturation can result in prolonged catheter exposure, increased risk of infection, and additional procedures performed to assist in the maturation of the non-functioning fistula.
Speaker #6: Because of these risks, patients with fistula non-maturation have a high unmet medical need. We believe the efficacy and safety results of the V07 subgroup, combined with the approximately 50% fistula failure rate in this high-risk group, mean that this is an excellent population for us to target in the market.
Speaker #6: We look forward to the publication of the results from the V07 Phase III trial in a major peer-reviewed medical journal later this year. After discussions with the FDA about a supplemental BLA filing in dialysis access, we're planning to target the general subgroup of patients at high risk of fistula non-maturation.
Speaker #6: Before we file a supplemental BLA, which we anticipate later in 2026, our plan is to complete the interim analysis of the currently ongoing V12 Phase III trial that is being conducted only in women and compares the ATEV to fistula for hemodialysis access.
Speaker #6: To date, a total of 100 patients have been enrolled in the V12 Phase III trial, out of a target of approximately 150 patients. An interim analysis is planned when the first 80 patients reach one year of follow-up.
Speaker #6: And this enrollment threshold was achieved in April of 2025. Subject to these interim results, Humacyte's plan is to submit a supplemental BLA in the second half of 2026.
Speaker #6: Including data from V12 and the V07 Phase III pivotal studies to expand the SIMVEST label and add AV access for hemodialysis as an indication.
Speaker #6: We're pleased with the progress that we're making in 2025, and we look forward to sharing our progress with all of you as the rest of the year unfolds.
Speaker #6: With that, I'll now turn it over to Dale for a view of our financial results and other business developments.
Speaker #7: Thank you, Laura. We reported $0.3 million in revenue for the second quarter of 2025, of which $0.1 million related to U.S. sales of SIMVEST.
Speaker #7: The remaining $0.2 million resulted from a research collaboration with a large medical technology company to evaluate the potential use of our bioengineered human tissue in specific cardiovascular and vascular applications.
Speaker #7: Revenue for the six months ended June 30, 2025, was $0.8 million, of which $0.2 million related to U.S. sales of SIMVEST and $0.6 million resulted from the research collaboration.
Speaker #7: There was no revenue for either the second quarter or the six months ended June 30, 2024. Cost of goods sold was $0.2 million for the second quarter of 2025 and $0.4 million for the six months ended June 30, 2025.
Speaker #7: Included was overhead related to unused production capacity, which was recorded as an expense in the period. There was no cost of goods sold for either the second quarter of 2024 or the six months ended June 30, 2024.
Speaker #7: As previously discussed, during the second quarter of 2025, we implemented a plan to reduce our workforce by 30 employees to further facilitate additional new hires and reduce other operating expenses.
Speaker #7: These cost reductions were made to extend our cash runway and to better align our organizational structure with our top business objectives. These reductions were made thoughtfully, and we retained key personnel resources and initiatives to meet our key corporate goals and milestones.
Speaker #7: These key objectives include the commercial launch of SIMVEST, including sales, marketing, and manufacturing; completion of the V12 Phase III pivotal study of the ATEV in dialysis; and the planned filing of a supplemental BLA with the FDA in the dialysis indication.
Speaker #7: And also the filing of an Investigational Device Exemption (I&D) to commence human study of the small diameter ATEV in CABG. We estimate that we have incurred and will incur aggregate charges representing one-time cash expenditures for severance and other employee termination benefits of approximately $0.7 million.
Speaker #7: The majority of which was incurred during the second quarter of 2025. We estimate net savings due to workforce reductions, operating cost reductions, and reduced capital expenditures, net of this termination severance and benefits, totaling approximately $3.8 million in 2025.
Speaker #7: Net savings are estimated to be up to approximately $38 million in 2026, for a total estimated savings of over $50 million in 2025 and 2026 relative to the original budget forecast.
Speaker #7: Due to the timing of the cost reduction plan, any anticipated savings are expected to occur after June 30, 2025. Research and development expenses were $22.0 million for the second quarter of 2025.
Speaker #7: Compared to 23.8 million for the second quarter of 2024, and 37.4 million for the six months ended June 30, 2025, compared to 45.0 million for the six months ended June 30, 2024.
Speaker #7: The decrease in R&D expenses for the second quarter of 2025 compared to 2024 primarily related to the capitalization of overhead costs associated with the commercial manufacturing of SIMVEST.
Speaker #7: Offset by higher non-commercial production runs, the decrease in R&D expenses for the six months ended June 30, 2025, compared to 2024, resulted primarily from decreased material costs as the company began capitalizing expenditures for inventory following the commercial launch of SIMVEST.
Speaker #7: As well as the capitalization of overhead costs associated with this commercial manufacturing. Selling, general, and administrative expenses were $7.8 million for the second quarter of 2025.
Speaker #7: Compared to 5.7 million for the second quarter of 2024, revenues were 15.9 million for the six months ended June 30, 2025, compared to 11.1 million for the six months ended June 30, 2024.
Speaker #7: The increase in 2025 expenses compared to the prior year resulted primarily from the U.S. commercial launch of SIMVEST and the vascular trauma indication, which included increased personnel expenses.
Speaker #7: Other net income or expense for the second quarter of 2025 was a net expense of $7.9 million, compared to a net expense of $27.2 million for the second quarter of 2024. Additionally, other net income for the six months ended June 30, 2025, was $54.4 million, compared to other net expense of $32.5 million for the six months ended June 30, 2024.
Speaker #7: The decrease in other net expense for the second quarter of 2025 and the increase in other net income for the six months ended June 30, 2025, compared to the prior year results, resulted primarily from the non-cash remeasurement of the contingent earnout liability associated with our August 2021 merger without the healthcare acquisition core.
Speaker #7: That loss was $37.7 million for the second quarter of 2025 compared to a net loss of $56.7 million for the second quarter of 2024. Net income was $1.5 million for the six months ended June 30, 2025, compared to a net loss of $88.6 million for the six months ended June 30, 2024.
Speaker #7: The decrease in net loss for the second quarter of 2025 and the increase in net income for the six months ended June 30, 2025, compared to the prior year periods, was primarily due to the non-cash remeasurement of the contingent earnout liability described above.
Speaker #7: We had cash, cash equivalents, and restricted cash of $88.4 million as of June 30, 2025. Total cash use was $6.9 million for the six months of 2025.
Speaker #7: Compared to net cash provided of $13.1 million for the first six months of 2024, the net cash used for the first six months of 2025 included $46.7 million in net proceeds from a public offering completed in March 2025.
Speaker #7: The total cash provided for the first six months of 2024 included $43.0 million in net proceeds from a public offering completed in March 2024.
Speaker #7: And the receipt of $20 million in proceeds from a draw under a loan arrangement that did not occur in 2025. With that, I will turn it over to Laura for some closing remarks.
Speaker #1: Thank you, Dale. The approval and launch of SIMVEST is a powerful example of our commitment to delivering truly transformative regenerative medicine solutions to improve patient outcomes.
Speaker #1: With our strong commercial execution, our promising pipelines, and our dedicated team, we're confident in our ability to continue making a positive impact. Thank you for joining our call today.
Speaker #1: And operator, we're now ready to take questions.
Speaker #3: Thank you. If you'd like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue.
Speaker #3: You may press star two if you'd like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset.
Speaker #3: Before pressing the star keys, our first question comes from the line of Ryan Zimmerman with BTIG. Please proceed with your question.
Speaker #8: Good morning. Thanks for taking our questions, Laura and Dale. We appreciate it. Maybe just to start on, you know, some of the dynamics commercially, Laura, you know, if you think about the second quarter volume versus what's taken place in July, and, you know, you noted that uptick.
Speaker #8: Is anything changed in your view that, you know, you think you can identify in July that, you know, now becomes kind of more part of your commercial strategy?
Speaker #8: In terms of, you know, launching SIMVEST.
Speaker #6: Thank you for that, Ryan. You know, a lot of it is just the passage of time. We really embarked on the VAC process in late February, early March.
Speaker #6: And many of these committees just take months and months. So, so part of it was that. part of it, part of the, uptick in, in hospitals eligible to purchase SIMVEST was the fact that we did have several, you ow, hospital systems approve, approve of the product in their VAC processes.
Speaker #6: But I would also say, you know, we've looked at decreasing the price of SIMVEST from $29,500 to $24,250. This decrease in price still allows us to have good margins on the product.
Speaker #6: But by coming in below $25,000, this has increased the ease with which VAC committees can review our product and agree to bring it onto the shelf.
Speaker #8: Yeah, you actually, that my next question around pricing strategy. Looking at kind of the unit volumes versus the revenue, and is that, you know, now something that you're, you know, making standard across all facilities?
Speaker #8: I guess, you know, how do you think about kind of your pricing strategy over time? And, and if this is kind of the new price point that we should think about going forward?
Speaker #6: You know, I think this is the new price point that we should consider. This was a price point that we put into place on July 1st.
Speaker #6: so that's certainly correspond, you know, that had some overlap with the uptick in sales. I don't think that was the entire thing though. But because we clearly had centers that were buying before the decrease price, but, but the decrease in price, you know, will, will now be standard for next year.
Speaker #6: And then, just as with any other medical products, we will consider annual price increases on a yearly basis.
Speaker #8: Okay. All right. Thanks for taking my questions. I'll hop back in the queue.
Speaker #3: Thank you. Our next question comes from the line of Josh Jennings with TD Cowen. Please proceed with your question.
Speaker #9: Hi, good morning, Laura and Dale. Thanks. For the questions, I wanted to just ask, I know you talked about some of the headwinds early in the year from substantiated taxpayer factors.
Speaker #9: And I was just, wanted to review just the, the accrual of, of real-world evidence. And any registry data that, that would build over the, the coming quarters, years that, that would, more significant, significantly bury any detractor noise.
Speaker #6: Well, I think, you know, as we've mentioned to the market, we do have some post-approval commitments with the FDA to essentially create a registry of trauma patients and follow at least 100 patients for a year.
Speaker #6: we're still working on that protocol with the FDA. So that registry hasn't officially kicked off yet, but we're still, we're on time, you know, we're, we're meeting our timelines, and our milestones for that.
Speaker #6: But, but I, I actually think that the real-world evidence is going to continue to accrue in different hospitals that are using the product.
Speaker #6: You know, multiple hospitals have reordered the product. and, and there are people who are using it, and with, with a tremendous amount success. So I think that that word of mouth, but also publications, from real, real-world use of the product, will definitely help to, help to solidify our commercial position.
Speaker #10: And Josh. DJ
Speaker #9: Excellent.
Speaker #10: Here. I can, yeah. Thanks. Real quick. Oh, Josh, it's BJ here. I was just going to jump in and add to what Laura was saying.
Speaker #10: Obviously, we had published our budget impact model, but we continue to publish our trauma data, both civilian and military, be it the U.S. and, you know, work in Ukraine. You know, first it was, you know, 30-year data.
Speaker #10: We have upcoming one-year data that will continue to show the durability of our product. I think that's, you know, important. And just to round out around the public attacks, you know, how that has played out, and it was somewhat to Ryan's point too, is that it's just really slowed the approval process.
Speaker #10: You know, the majority of the effect is just now taking longer to get through hospitals, but we have been able to overcome that. And, you know, I think that's also, you know, the tough economy has made it tougher for any new products. If you talk to other companies that have launched new products recently.
Speaker #10: And it's just, in general, a longer process. But, you know, given our full funnel and working through this process, and the success that we had at the end of June and beginning of July, I feel that we're turning the corner.
Speaker #10: Thanks for that. I want to touch on the inclusion in the electronic catalog and the opening up of access to the 190 military treatment facilities.
Speaker #10: Can you help me think through the commercial effort in this VA hospital channel to drive increased traction? I know you've had your first order, but I wanted to kind of get help thinking about the back half of the year in this channel and then in 2026.
Speaker #10: And, and how you guys can go on offense more fully here.
Speaker #9: Yeah. Kind of how, you know, I look at it is, you know, there's both the individual hospital work and then, obviously, a collection of hospitals or some type of larger purchase.
Speaker #9: And, you know, in the near term with the ECAT, again, it opens up the military treatment facilities. I'd say a good number of them are targets of ours.
Speaker #9: And then a much larger number of VAs. But it'll be more selective targets within the VAs where they obviously perform trauma procedures. So, you know, a minority of them, we've had, you know, the initial order reorder. We've been able to meet with some of the other major facilities, some that were involved in our clinical work.
Speaker #9: Others that we've had peer-to-peer discussions with, you know, those that have used it in the military introducing us to other hospital insurgents. And so I think through the rest of this year, we'll be penetrating, you know, those hospitals—those hospitals that are targets of ours.
Speaker #9: But then in parallel, there is obviously the procurement process for some type of bulk purchase, stockpiling that we are working in parallel. And I believe, you know, as we have more successful military experience, it, that in concert with working the procurement process, as we, you know, end the year and roll into next year, that's, the, larger purchase becomes more viable for us.
Speaker #10: Thank you for that as well. And then just lastly, on the AV access indication, if we secured the 80 patients enrolled for that back in April and have 100 today.
Speaker #10: It sounds, is it okay to kind of forecast enrollment completion for the trial for the 150 patients by year-end 2025? And, maybe just kind of review the timelines for interim analysis, once you get the last patient follow-up, 12-month follow-up in April 2026.
Speaker #10: And how that could play out next year. Thanks for taking all the questions.
Speaker #6: Yeah, Josh. So we're going to aim to complete 150 patients by the end of the year. It's always hard to know, you know, it's very hard to predict trial enrollment.
Speaker #6: So it could be before the end of the year; it could be a little after the end of the year. Hard to know. But regardless, the interim analysis is now fixed, as you mentioned, in April of 2026.
Speaker #6: So I would imagine we will have top-line results from that, you know, certainly by May or June for that interim analysis.
Speaker #6: And then we would be able to share those results, with the market. as far as the, as far as the way the trial is designed, the way was originally written is that if we are successful on the interim analysis, and if our vessel is, is superior to fistula, with those 80 patients, then, then we're done.
Speaker #6: You know, if the trial is successful and we move on, in that situation, we would then, as we've said, anticipate filing a supplemental BLA in the second half of 2026.
Speaker #6: If we don't hit that interim analysis, then we just continue following the 150 patients, and we would feel pretty confident that we're going to hit the analysis at 150.
Speaker #6: And since all of those patients would already have been enrolled, the additional time lag there would be, I don't know, six or eight months, something like that.
Speaker #10: Thanks for reviewing that, Laura. I appreciate it.
Speaker #3: Thank you. Our next question comes from the line of RK with HC Wainwright. Please proceed with your question.
Speaker #11: Thank you. You know, good morning. Laura and Dale. A couple of quick questions for me. The first question is, looking back, at the first quarter press release, you know, you were stating fortified hospitals had initiated the VAC process.
Speaker #11: So, how many of those have actually ordered at this point? And also, any insight into what the timeline is in general for getting through the VAC to the ordering process itself?
Speaker #10: Laura, I can, I can jump on in on this.
Speaker #6: Yeah. Why don't you take that, BJ? You'll be better. Yeah.
Speaker #10: Problem. Feel free add. so it's, is a mix of, you know, hospitals that we started early and then hospitals that we've approached more recently.
Speaker #10: that, you ow, a mix of them that have worked through the process to then have the approval to then be able to sell into.
Speaker #10: But as we stated in the press release, we've had 12 hospitals to date order SIMVEST. A number of them have already reordered.
Speaker #10: so our, you know, success rate with VAC, is strong. You know, as I mentioned before, you know, in, in Q2, some of the public attacks, you know, did slow us down.
Speaker #10: with value analysis committees and, and that's where I was, you know, mentioning that, in kind of from my commercial experience, you know, you could think three to six months to get through a value analysis committee.
Speaker #10: And then obviously contracting on the back end, you ow, we view that as six to nine plus months now. one in general because of the economy, but then also some of, you know, the, the attacks on us, but as I also mentioned, you know, we have a full sales funnel and not all of them take the upper end and not all of them the lower end.
Speaker #10: So if you have a full funnel, you always have something coming through on the back end to, with approval and then be able to sell into.
Speaker #10: But that, you know, that's something that we've accounted for, and as I mentioned, we believe we're turning the corner on.
Speaker #11: Thank you for that. The second question is, you know, regarding the negative decision by the CMS. What sort of an impact, you know, if any, would it have on the private payers' reimbursement decisions?
Speaker #10: Yeah, Laura, I can jump in on that one too and, and feel free.
Speaker #6: Sure. ure.
Speaker #10: as Laura had mentioned, obviously, you know, a disappointment for us, you ow, newness, I ink we can kind of all agree that our product, you ow, new and, you know, a one of one, type, but, but we us, e, you know, we were, you know, denied, that was disappointing.
Speaker #10: You know, there are pathways that we think you can refile. That's something that we will, you know, look at and consider.
Speaker #10: But when it rolls to, and, and again, private payers are the ones that pay the majority for these vascular trauma repair-type procedures and these patients, hey, we believe that our product is new.
Speaker #10: but more importantly, how private payers view, in essence, being able to pay for a product and writing, you know, writing, procedures, you ow, behind that is really based on your clinical and health economic data.
Speaker #10: And so, not only of what we've gathered, but published peer-reviewed, both on the clinical side and following these patients over time, and our budget impact model that's also published of reducing costly complications like infections and amputations versus products that are used today, that private insurers will see this as a value, you know, a strong value proposition, and work with them to get them to incrementally pay for our product.
Speaker #11: Thanks. Thanks for taking my questions.
Speaker #6: I, I guess I would add to that, RK, that, you know, the our success rate with VACs has been pretty good and we've, we've gotten into it an enormous number of hospitals just in the last couple months, you know, up to 84, which is very exciting for us.
Speaker #6: but, you ow, when hospitals look at the financial prospects for a product, they're ally just looking at the, the puts and takes on that initial hospitalization because this is a DRG process.
Speaker #6: And so hospitals are focused on the cost to take care of that patient just during the hospitalization. Payers, on the other hand, are on the hook for longer-term complications.
Speaker #6: So, particularly with infection and amputation, which drive a lot of costs in the initial hospitalization, but which continue to drive costs after discharge because of readmissions, because of physical therapy, because of, you know, repeated procedures.
Speaker #6: Insurance companies are on the hook for all of that. And, so I believe that our, that our financial case, for, providing a supplemental payment for SIMVEST and trauma, is going be even stronger with private payers.
Speaker #6: So we've got, you know, we've got our ducks in a row. We're lining up private payers, and we're going to go out and start having those conversations very soon.
Speaker #11: Thanks. Thank you both.
Speaker #3: Thank you. Our next question comes from the line of Bruce Jackson with The Benchmark Company. Please proceed with your question.
Speaker #12: Hi. Good morning and thank you for taking my question. I was wondering if we could get an update on the coronary artery bypass graft program.
Speaker #6: Yes, absolutely. We have a paper that's been accepted for publication about our primate results in coronary artery bypass that we expect to publish in the near future.
Speaker #6: And we'll put out a press release with that when that happens. we're also making excellent headway on our I&D filing. With the FDA, so we are, you know, we're in the process of pulling that filing together and we expect to have that in later in 2025 as we've messaged the market previously.
Speaker #6: After we submit the I&D, you know, we anticipate that the FDA will spend some time looking at it. You know, we're a best-in-class product, and we're going into the human coronary system.
Speaker #6: So, we expect that there will be some review time, but once they approve that—and I certainly anticipate that they will—then we would start our clinical trial sometime in 2026.
Speaker #6: So, everything is on track with what we've messaged the market previously.
Speaker #12: Okay, great. Thank you. That's it for me.
Speaker #3: Thank you. Ladies and gentlemen, that concludes our question-and-answer session. I'll turn the floor back to Dr. Laura Niklason for any final comments.
Speaker #6: Thank you, everyone, for joining us this morning. Our fantastic commercial team has continued to execute during this exciting time. I personally am very excited by the fact that so many hospitals, both civilian and military treatment facilities and VAs, are now eligible to purchase our product.
Speaker #6: You know, more than 200 facilities. If we compare that to the five facilities that were on tap to purchase our product just three months ago, I think this is huge progress.
Speaker #6: So, you know, we're going to continue working on the contract negotiations and continue shipping and selling product. You know, it's make product, sell product.
Speaker #6: And that's where our ocus is. And I'm so glad that we're getting traction here. So I appreciate your time. And I look forward to sharing more results with you later this year.