Cerus Corporation

Good day, ladies and gentlemen. Thank you for standing by, and welcome to the Sears Corporation's second quarter 2023 earnings conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 11 on your telephone. You will then hear an automated message advising that your hand is raised. To withdraw your question, please press star 11 again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to Jessica Hanover, Cirrus's Vice President of Corporate Affairs.

Dr. Hanover, you may begin. Thank you and good afternoon.

I'd like to thank everyone for joining us today. As part of today's webcast, we are simultaneously displaying slides that you can follow. You can access the slides from the Investor Relations website at ir.cirrus.com. With me on the call are Obi Greenman, Cirrus's President and Chief Executive Officer, Vivek Jayaraman, Cirrus's Chief Operating Officer, Kevin Green, Cirrus's Chief Financial Officer, Dr. Nina Musti, Cirrus' Vice President of Development and Red Blood Cell Program Leader, Dr. Richard Benjamin, Cirrus' Chief Medical Officer, Dr. Lawrence Korash, Cirrus' Chief Scientific Officer, and Carol Moore, Cirrus' Senior Vice President of Regulatory Affairs and Quality. Cirrus issued a press release today announcing our financial results for the second quarter ended June 30, 2023, and describing the company's recent business highlights. You can access a copy of this announcement on the company website at www.siris.com. I'd like to remind you that some of the statements we will make on this call related to future events and performance rather than historical facts and our forward-looking statements. Examples of forward-looking statements include those related to our future financial and operating results, including our updated 2023 product revenue guidance, expected operating expense savings, our adjusted EBITDA goal, and future operating expenses, as well as our commercial development efforts, expected future growth and our growth strategy, future product sales, potential product launches, ongoing and future clinical trials, ongoing and future product development, and our regulatory plans and initiatives and related expectations, including the timing of these events and activities. These forward-looking statements involve risks and uncertainties that could cause actual events, performance, and results to differ materially. They are identified and described in today's press release and under risk factors in our Form 10-Q for the quarter ended June 30, 2023, which we will file shortly. We undertake no duty or obligation to update our forward-looking statements. On today's call, we will also be discussing non-GAAP financial measures, including non-GAAP adjusted EBITDA. These non-GAAP measures should be considered a supplement to and not a replacement for measures presented in accordance with GAAP. For reconciliation of non-GAAP financial measures to the most comparable GAAP financial measures, please refer to today's press release. We'll begin today with opening remarks from Obie, followed by Vivek to discuss recent business highlights, and Kevin to review our financial results and expectations for 2023. And now, it's my pleasure to introduce Obie Greenman, Cirrus's President and Chief Executive Officer.

Thank you, Jessica, and good afternoon, everyone. Today, I would like to begin the call with a commentary about the progress we have made in Q2 across our full Intercept portfolio, combined with the ongoing expansion of our commercial business. Most significantly, during the second quarter, we gained new visibility into the European and U.S. timelines for our Intercept red blood cell program. In the EU, as you will recall, we previously received questions from our competent authority, CBG MEB, or MEB as part of our overall MBR process for our EU submission for CE mark approval. Due to the workload for regulatory authorities associated with the new MBR process for device approvals in the EU, it was late June when we were able to have a clarification meeting with MEB to review our strategy for addressing their questions. The meeting was very positive and confirmed our approach for addressing MEB's questions as sound and on point. Based on the discussion of this meeting, we expect the MEB will accept our comprehensive responses to their questions in Q4 of this year. Assuming no further issues are identified by MEB, we expect them to prepare a positive opinion, which they will provide to our notified body, TEV, in the first half of next year. From the MDR process, because the TEV has already completed its initial review of all modules of our submission, we would then expect a CMARC approval decision in the second half of 2024, which, if approved, would enable the rollout of the product associated with a requisite hemovigilance program at multiple sites across Europe. Also in June, we held a scientific advisory board meeting for intercept red blood cells with leaders in the field of transfusion medicine. During this meeting, we gained valuable insights into existing unmet needs for anemia patients requiring chronic red cell transfusions and the value proposition of pathogen-reduced red blood cells. Coming out of this meeting, we continue to believe in the product profile and the immediate clinical need for patients receiving chronic red cell transfusions. The ability to replace gamma radiation and its associated deleterious impact on red blood cell function is a key attribute of the intercept process. Turning to the U.S. RBC program, our two U.S. BARDA-funded Phase III trials, RECIPE and REDIS, continue to enroll patients at a good rate. With 309 patients now enrolled in transfusion RECIPE, we expect to complete enrollment this year. With patients remaining on study for 90 days after their transfusion event, We are planning on a database block and an initial top-line data readout from this trial in Q1 of 2024. Based on the ongoing enrollment in our second U.S. Phase III trial, REDIS, we now plan to begin the modular PMA submission in H2 2025, culminating in the last module being the clinical one planned for H2 2026. With respect to our earlier stage pipeline, As we announced in June, we received additional funding of more than $8 million from the U.S. Department of Defense to support the ongoing development of lyophilized intercept fibrinogen complex, or LYO-IFC. Since receiving the initial DOD funding award in November 2022, we have successfully scaled up the lyophilization process, provided prototype materials for evaluation to the DOD, and met with the FDA to define the regulatory pathway for LYO-IFC to include additional manufacturing steps, and design of preclinical and clinical studies. The additional contract we have now been awarded is anticipated to support the implementation of manufacturing processes required by the FDA, continued scale-up of manufacturing technology for the Lyo-IFC products, and development of data to support a submission to the FDA designed to enable initiation of preclinical and clinical studies. We've also continued to work on our LED-based next-generation illuminator. During the International Society of Blood Transfusion, or ISBT, Congress in Gothenburg, Sweden, held in person in June for the first time since 2019, we hosted customer-focused group meetings with over 30 blood bankers from more than a dozen centers. We were pleased with the excitement from the group during the hands-on demonstration of the new device and grateful for the important feedback that our customers have provided over the last several years to guide development. In addition, our EFS research collaborators in France gave an independent oral presentation at the ISBT Congress, demonstrated the comparability of the LED illuminator with the current INT100 illuminator. This new illuminator will serve as a platform for our future product iterations over the coming decade, and the intellectual property position and improved customer operating experience furthers our leadership role in the transfusion medicine field. With respect to our commercial business, we emerged from a challenging first half to expectations of growth for the rest of the year and into 2024. The lake will provide more insights in its commentary following mine. We expect Intercept Fibrogen Complex, or ISC, to play an increasingly important role as we make strong progress with our newest production partner, OneBlood, and advance discussions with even larger U.S. blood centers for this product. We are encouraged by the recent addition of pathogen-reduced cryoprecipitate, to the World Health Organization, or WHO, essential medicines list because it provides additional global validation for the utility of our IFC product. We look forward to providing updates on our continued progress for our pipeline and commercial business in future calls. I would now like to turn the call over to Vivek to discuss the second quarter commercial highlights and the outlook for the remainder of the year.

Thank you, Obi, and good afternoon to everyone joining on today's call. As reported in our press release earlier today, our total product revenues for the second quarter of 2023 was up significantly from the first quarter, showing sequential growth of 25%. Within the quarter, we experienced an impact on our U.S. customer ordering patterns associated with a temporary reduction in the FDA-approved shelf life for intercept platelet kits. Due to a recent component change, the FDA required six-month shelf life for the kits, which led to customers rebalancing their inventory levels in order to minimize obsolescence. We did not see any reduction in share during the period, but the efforts to right-size inventory levels did affect ordering patterns. This shelf life issue is unique to the U.S. market because the other regulatory bodies in Europe and elsewhere did not see the need for real-time stability studies for this component change to the kit. We are actively pursuing a regulatory filing plan to be submitted to the FDA later this year designed to extend the kit shelf life to nine months within the first quarter of 2024, and then follow with further improvements in shelf life dating quarterly throughout the remainder of next year. We believe this will alleviate the impact on customers and allow normal ordering patterns to resume, supporting our expected return to growth. Looking at the overall U.S. market, Intercept Tree, the platelets continue to be a leading choice for patient transfusion safety, and we have many strong blood center partners who are, or are on the way to becoming 100% patch and reduce platelet producers. The recent FDA guidance on production of cold storage platelets for patients with active bleeding includes an option for preparation with Intercept, providing added manufacturing flexibility to our customers with extension to 14-day shelf life. This new development will improve the availability of Intercept platelets to help alleviate recent constraints in the U.S. platelet supply. We continue to see increased intercept adoption at leading hospitals across the country as awareness of the clinical benefits of patch and reduction bills. Beyond simply the FDA bacterial safety guidance compliance, patch and reduced platelets offer unmatched protection against a wide range of potential infectious threats. We remain committed to ongoing partnership with our U.S. blood center customers to ensure that they can provide their hospital customers with the best possible product. Outside of the U.S., we continue to be pleased with the ongoing rollout of intercept platelets by Canadian Blood Services, or CBS. More than 25% of all CBS platelets are currently intercept treated, with four of their eight manufacturing sites now live with intercept, and activities are on track to complete the rollout in the first half of next year. Our ongoing validation work with Hammock, Quebec is going well, and we are excited to broaden access to estrogen-reduced platelets to our neighbors to the north. In Europe, we experienced some acute headwinds in France and Belgium due to a reduction in platelet collections related to donor availability. As you will likely recall, these countries utilized pass-through reduction to save credit 100% of their platelet supply, so we saw no impact on intercept share in these regions. Also during the quarter, new sanctions in Russia impacted our EMEA franchise. We are in the process of applying for a license to account for these sanctions and continue to monitor the situation closely to ensure that we can help patients gain access to our technology. We continue to see strong interest in ISD. We are now fully staffed on the sales side and are able to access many more hospitals to drive awareness and demand. In parallel, we are working closely with our blood center production partners to ensure that supply is available and demand increases. Most recently, our partnership with OneBlood has been particularly productive, as their commitment to making IFC accessible to hospital customers has been strong. We look to replicate this experience with other partnerships, and to this end, we are in discussions with other large U.S. blood centers for IFC. On the hospital provider side, the level of clinical interest in IFC is encouraging, and we continue to see major medical centers onboard the process. During the quarter, as Obi noted, we enjoyed a very strong showing at the recent ISBT Congress in Gothenburg, Sweden. At the Congress, we were able to engage with many of our customers, clinical trial partners, and industry collaborators and gain substantial positive feedback with respect to the complete Intercept product portfolio. During the scientific sessions, there were several Intercept-focused talks in which users presented compelling data focused both on their routine use experiences with Intercept as well as developmental programs such as the LED Illuminator and Intercept RBCs. Dr. Graham Scher, CEO of Canadian Blood Services, provided positive feedback about their journey to date in deploying Intercept platelets across their service area. Taking a step back, it is clear that we continue to make meaningful strides across the globe and are accruing meaningful wins as we push to ensure access to safe blood products. While we saw strong sequential growth in Q2, we still faced some headwinds in our commercial franchise. That said, we remain optimistic about the outlook for the second half of 2023 and for the resumption of meaningful growth in the years to come. With each passing order, we can see more real-world validation of the clinical benefits of patch reduction for platelets. And while we would love for things to move faster, we are experiencing real momentum in our US IFC franchise. I look forward to providing updates on our progress in the coming quarters. I will now turn it over to Kevin to discuss our results and outlook in more detail.

Thanks Vivek and good afternoon everyone. Today I will be discussing our financial results for the second quarter, our product revenue guidance for the year, and our progress on the levers we have and will continue to utilize as we work towards reaching adjusted EBITDA breakeven by the end of this year. We posted second quarter 2023 product revenue of $38.9 million, representing a year-over-year decrease of 5%, primarily due to the factors noted by Vivek earlier. In the U.S., product revenues were slightly down by 5% year-over-year, but sequentially we saw a significant step up from Q1 of 45%, confirming our earlier expectations that the business would begin to see a rebound to more historical levels of growth. In EMEA, Product revenues were down 9% year-over-year and 4% sequentially. Year-over-year, FX rates provided a slight benefit of around 800 basis points. In addition to our product revenue and not included in our guidance, government contract revenue totaled $8.9 million in Q2 compared to $6.6 million for the prior year period. Included in our government contract revenue are the revenues recognized as reimbursement under our contract with BARDA, our agreement with the FDA to further whole blood pathogen reduction, and our agreement with the U.S. Department of Defense for LIO-IFC. As noted in our earnings release, we are pleased that during Q2, the DoD has agreed to increase the funding and scope of this program and awarded us with an additional $8.7 million bringing the total contract value to $17.8 million. Turning now to our product gross profit and gross margins. Our second quarter product gross profit was $21.3 million, consistent with the prior year period. Product gross margins for the quarter were 54.9%, a 300 basis point increase versus the prior year period, and generally stable from Q1. Moving on, our second quarter operating expenses, which totaled $41.9 million, were $7.1 million higher than the prior year period and included $5.7 million in non-cash stock-based compensation. By specific expense type, second quarter R&D expense totaled $19.2 million, compared to $15.2 million during the prior year period. We had increased R&D activity for the development of our Next Generation Illuminator, along with increased government reimbursed activity associated with our BARDA, FDA, and DOD agreements. In addition, we recorded increased costs associated with developing data and answering questions from regulatory agencies, namely the FDA, surrounding our existing products. Second quarter SG&A expense was $20.5 million. compared to $19.5 million during the prior year period. The increase in SG&A expense was primarily driven by hires of sales personnel to drive acceleration of our IFC business and, to a lesser extent, general inflationary impacts. Also included in our operating expenses for the second quarter was a one-time restructuring charge of $2.1 million related to a modest reorganization of resources during the quarter. providing us with additional operating flexibility to bolster our drive towards adjusted EBITDA breakeven. We expect to take another restructuring charge in Q3 as we cease use of certain leased real estate as part of the comprehensive restructuring plan. Going forward, we estimate that the cumulative effect of these initiatives will generate approximately $10 million in operating expense savings on an annualized basis. On the bottom line, REPORTED NET LOSS ATTRIBUTABLE TO CIRRUS FOR THE THREE MONTHS ENDED JUNE 30, 2023 WAS NOTABLY HIGHER WHEN COMPARED TO THE SAME PERIOD IN 2022. NET LOSS ATTRIBUTABLE TO CIRRUS FOR Q2 TOTALED $13.3 MILLION OR 7 CENTS PER DILUTED SHARE COMPARED TO $8.4 MILLION OR 5 CENTS PER DILUTED SHARE FOR THE PRIOR YEAR PERIOD. HIGHER OPERATING EXPENSES including the impact of the restructuring charge, were largely responsible for the increased net loss. We expect this trend to reverse itself as we move forward with anticipated higher revenue comps, improving gross margins, and moderated operating expenses. Moving on to our adjusted EBITDA metric, second quarter non-GAAP adjusted EBITDA totaled negative $4.7 million, compared to a negative $2.4 million during the second quarter of 2022, and negative $9.8 million during the first quarter of this year. On a year-to-date basis, our non-GAAP adjusted EBITDA decreased in the first half of 2023 to a negative $14.5 million, compared to a negative $6.1 million in the first half of 2022. As we look to the second half of the year and beyond, We are reaffirming our efforts to achieve adjusted EBITDA breakeven this year. We expect the second half will provide a return to year-over-year growth on our top line, and we expect fairly stable gross margins. As I noted earlier, we undertook a restructuring effort during the second quarter with an eye on our key commercial priorities and development initiatives. We expect this restructuring will provide some relief to our operating expenses and cash flows. and taken in combination, we believe the aforementioned are foundational components to meeting our adjusted EBITDA goal. Turning to the balance sheet and cash flows, we ended the second quarter with a strong cash position of $84.5 million in cash, cash equivalents, and short-term investments on the balance sheet. In terms of cash utilization, our cash use from operations was $7.6 million for the second quarter, compared to approximately $350,000 during the prior year period. Clearly, the first half provided some operational challenges we expect will reverse in the second half of the year. From a cash flow perspective, a byproduct of those challenges was an overproduction of inventory, as you can see on our balance sheet. We are moderating production in the second half of the year and expect that with the anticipated growth in sales, we will reverse this cash flow trend by monetizing the first half over production. Given the changes in US customer ordering patterns related to the temporary impact of the platelet kit reduced shelf life, coupled with market dynamics in France, Belgium, and Russia, we are adjusting down our full year 2023 product revenue guidance to a range of $160 million to $165 million. We want to point out that we have not lost market share and continue to see strong demand for intercept platelets in the U.S. and EMEA, and we believe that we remain on a trajectory to return to growth in the back half of the year and into next. Furthermore, as I previously mentioned, we remain committed to achieving adjusted EBITDA break-even by year-end 2023, and in light of lowered product revenue guidance and continued macroeconomic conditions, we have been and will continue to be very focused on aligning our operating expenses with our key priorities. which include ongoing capacity expansion and supply chain security, global regulatory submissions for our next-generation LED illuminator, and potential red blood cell licensure in EMEA, along with government-reimbursed activities, and last but not least, support of our commercial infrastructure. With that, let me turn the call back over to the operator for Q&A.

Thank you. We will now conduct the question and answer session.

As a reminder, to ask a question, please press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one one again.

Please stand by while we compile the Q&A roster. Our first question comes from the line of Jacob Johnson of Stevens. Your line is now open. Our first question comes from the line of Jacob Johnson of Stevens.

Jacob, your line is now open.

Hey, sorry, I was on mute. Good afternoon, everybody. Apologies. Maybe first, just on the 5 million reduction in guidance, can you just talk through how much of that is related to the inventory and how much of that's related to Europe? Can you hear me, guys? Yeah, we can hang out. Thanks. Yeah, I'm sorry about that. Yeah, sorry. Just the $5 million change in guidance, can you just flesh that out in terms of how much of that's related to U.S. inventories and then how much of that's related to Europe, et cetera?

Yeah, thanks. Vivek, do you want to handle that?

Sure, I'd be happy to. You know, the The main component of that is related to the readjustment of inventories in the U.S. associated with the reduced shelf life. I'm not sure whether we break out specifically by Europe versus the U.S., but that certainly was the main headwind we faced in the first half of the year, which now that we've seen normalized ordering patterns, you know, what leads to our confidence to realize growth in the back half of the year, but that's kind of where the majority of it comes from.

Okay, that's helpful. Thanks, Vivek. And then, Kevin, just on the 10 million of cost savings you expect to realize, can you kind of help us understand how much of that's maybe coming out of COGS versus SG&A as we think about modeling that?

Yeah, firstly, I'll answer that directly, but I wanted to correct something in the prepared remarks. The FX impact that we realized was 80 basis points. rather than 800. So I apologize for that. We had a typo. But to answer your question specifically, we don't expect that the savings is going to come from COGS. It's going to come from operating expenses. And it's going to come from both R&D and SG&A. So, you know, on an annualized basis, after we cease use of some of our real estate funds, we do expect that we'll see at least $10 million in annualized savings.

Okay, great. Thanks, Kevin. I'll leave it there.

All right. Thank you. Thanks.

Thank you. Please stand by for our next question. Our next question comes from the line of Matt Blackman of Stifle. Your line is now open.

Good afternoon, everybody. Can you hear me okay? Yeah, we can hear you. Can you hear us? I can hear you. Okay. Yeah, just checking. I know. Well, thanks for taking the question or questions. Maybe to start, and Vivek, I just was hoping you could maybe expand a little bit more on on your reply to that question. I think you commented about seeing a return to normalized ordering patterns, I think, at maybe the back half of the quarter, maybe early here in the third quarter. Could you just sort of expand on that a little bit and sort of, again, why that gives you confidence that the issues that you saw here in the second quarter are sort of largely behind you? And then I've got a couple of follow-ups.

Yeah, sure. I'd be happy to and certainly welcome you know, Obi and Kevin DeWayne as well. The thing that the single largest reason for confidence has to do with the fact that we saw no degradation of share. And so really the impact of the short shelf life was a function of just rebalancing inventories. And I think, as you know, you know, just given the nature of our business, our deployment organization, we work very closely with our blood center partners. You know, we have a good insight into their operations, how they produce product, how they distribute product. And so, as we come to appreciate that they sort of reached a normalized level of inventory where they're able to feel good about their ability to meet platelet demand and also manage inventory, we've seen that return of normal ordering patterns, which again gives us confidence in terms of our outlook for growth in the year. But the single largest driver of my confidence in all of this is we saw no reduction in share and passenger reduction continues to be the standard of the care in terms of how platelet safety is maintained in the U.S.

Okay, and then can I just follow up and ask, you know, in the first quarter, we had the Red Cross inventory drawdown. Did that play out here in the second quarter as expected, and Is that largely behind you? And I do have one follow-up after that. I just want to make sure on the Red Cross where we stand on that front.

Yeah, sure, absolutely. So to answer the first part of the question, yes, you know, we had talked about that I think back in April. That's played out largely as we anticipated. You know, the Red Cross continues to be a very strong strategic partner. They've indicated that they're moving towards harmonizing their entire platelet franchise around passenger reductions. They're nearly there at this point in time, and we're seeing continued strong partnership for them. So I think the way you described it is accurate.

Okay, and then my last one. I appreciate you taking all my questions. But as we move past this, let's call it, inventory realignment period here in the first half of 23, how would you have us think about, just in general, a normalized growth trajectory for the business until we get red cell contribution, I guess, in Europe, in 2025, U.S. in the 2027 timeline, just anything to help frame how the business should grow here over the next, you know, period as we're waiting for the expanded indications, you know, expanded approvals and such. Thanks.

Yeah, sure. Happy to. And again, you know, maybe I'll ask Gobi and Kevin to jump in to cover up any, to add any thoughts here when I finish. You know, in advance of Red Cells, if you think about growth opportunities kind of stepping back and on a global basis, there continue to be significant markets where we're either just initiating introduction of platelets or that has yet to start. We've talked about in the past our joint venture partnership in China with CBK. There are certainly major markets in Western Europe and Latin America that as of yet are untapped. There still has room in the U.S., Play the market so while we're standard of care and. You know, we're sort of settling into the post to guidance compliance period. There's still opportunities for growth in the U. S. play that market. And then. I think about an independent driver that's going to that's been a significant area of focus and we. see real reasons for enthusiasm and momentum that's in the US ISC franchise where we fully staffed our hospital facing sales team. We're finding access to hospitals to be increasingly something that's growing increasingly. We're getting a lot of clinical feedback and we're onboarding really influential hospitals in terms of utilizing the ISC product. So those would be the areas in advance of Red Cells where I see us being a little over top line growth, and again, why we feel confident that we're in a position where we're seeing a normalization of ordering patterns and a return to growth for the overall franchise.

Yeah, thanks, Vivek. I think you covered it. One other thing I'd add is just in Vivek's prepared comments, you talked about the relationship with OneBlood, our new production partner, and what that unlocks with regard to a channel. And they have existing, obviously, hospital contracts around blood components that they can insert IFC directly into, so we don't have to worry about hospital contracting in that context. And so we're really excited about the progress that they're making, as well as progress across a lot of academic hospitals across the U.S.

Appreciate it. Thank you. I'll get back to you.

Thank you for your question. Please stand by for our last question. Our last question comes from the line of Joshua Jennings of TD Cohen. Your line is now open.

All right, great. Thanks. Good afternoon. I was hoping to just get an update on the build-out of the U.S. Salesforce, the hospitals facing reps, and I know it's still very early, but anything you can share just on the impacts of that build-out in 2Q, both in terms of drumming up IFC demand and adoption, and also just the potential early impacts of driving hospital demand for intercept platelets and that trickling up, creeping up to the blood centers of their customers' increased demand.

Yeah, thanks, Josh. As we had the U.S. commercial team out here a couple weeks ago, I guess I'll turn it back over to the bank since he was in the midst of all those meetings, but it was really a great discussion and interaction with the various hospital customers that they're engaged with. Do you want to give a little more context around that?

Yeah, sure. I'd be happy to. I guess kind of taking a step back, one of the things, Josh, that's very encouraging was just the volume of compelling CVs and resumes that we received when we posted those roles. Selling IFC, as you know, is a more of a classic physician preference sale. While there are multiple stakeholders in the decision-making process, one of the key starting points is a strong clinical champion who sees benefit in her or his practice in terms of being able to impact patients. And so we were able to get reps from a variety of different specialties to come in who have relationships with CV surgery, trauma, high-risk OB. And so that was encouraging in and of itself. We're already seeing an impact in terms of really an order of magnitude step up with respect to hospital visits, engagements, and as we get clinicians on board, we're seeing a lot of peer-to-peer marketing, which is pretty meaningfully impactful. As Obi indicated, we brought the fully hired sales team together out in California about a month ago now, and we did cross-training on both And we certainly see opportunities when they're in hospitals to have discussions about platelets as well to further drive demand there. We're seeing a lot of our heavy platelet user hospitals being the ones who are raising their hands at IFC. So there are a lot of cross-pollination opportunities there, and we're trying to take full advantage of that. So it's early days still, as you pointed out. know we know that demand generation and clinical awareness falls upon us in terms of responsibility and the sales team is a huge asset in terms of being able to deliver against that great and i just wanted to follow thanks for that i'm going to follow up on um i know you're not giving out kind of hard metrics on the ifc launch and this is a foundation building year but

Maybe you could just help us think through the first half of the year, think you're ahead of internal expectations for 2023, and then any update on any clinical studies or use case action that's going on. I think you called out an academic medical center in New York City that's running something, and when those use case or clinical studies happen. could be more impactful to the ramp of adoption of IFC in the United States. Thanks.

Thanks, Josh. So I think as the rollout this year has unfolded, we are seeing the type of interest from academic centers that we were expecting. And that seems to be ramping. There's a real momentum behind peer-to-peer interactions and we're obviously trying to facilitate those. So I think that seeing major academic centers like UCSF and Ohio State and others really adopt the technology and then roll it out much more broadly within their institutions is really, compelling. And then the other thing I mentioned previously around OneBlood was just that that channel combined with our existing sales team really opens up the market. It's not just the hospital contracts that exist, but also their internal teams. And as we expand those types of partnerships to even larger blood center institutions than OneBlood, that really gives us access across the entire country to major hospital institutions. Larry, did you want to provide a little bit of color around the study that we're doing in New York and sort of what the initial observations are?

Yeah, we have a study which is running at New York Cornell Medical Center. And what we're seeing is that IFC can be delivered from time of order to patient on average in 16 minutes. So we've dramatically changed the pattern of transfusion use for this product, and it's being well received in that setting. And we're rapidly accumulating data that we'll have later this year or early next year.

Great. Thanks so much. Thanks a lot, Josh.

Thank you. This now concludes the question and answer portion of our call. I'd now like to pass the call back over to Obi Greenman, the CEO of Cirrus, for closing remarks.

Well, thank you again for joining us today and for your interest in Cirrus. We look forward to updating you on our continued progress through the rest of the year. Thanks a lot for joining us today.

This concludes today's conference call. Thank you for participating. You may now disconnect.