Sera Prognostics, Inc.

Good afternoon, ladies and gentlemen, and welcome to the Sarah Prognostics fourth quarter 2025 financial results conference call. At this time, all lines are in a listen-no-we mode. Following the presentation, we will conduct a question and answer session. If at any time during this call we require immediate assistance, please press star zero for the operator. This call is being recorded on Wednesday, March 18, 2026. I would now like to turn the conference over to Jennifer Zibuda. Please go ahead.

Thank you, operator. Welcome to Sarah Prognostics' fourth quarter and full fiscal year 2025 earnings conference call. At the close of market today, Sarah Prognostics released its financial results for the quarter ended December 31st, 2025. Presenting for the company today will be Eugenia Lingard, President and CEO, Lee Anderson, Chief Commercial Officer, Dr. Tiffany Inglis, Chief Medical Officer, and Austin Ertz, our CFO. During the call, we will review the financial results we released today, after which we will host a question and answer session. If you've not had a chance to review our quarterly earnings release, it can be found on our website at sarah.com. This call can be heard live via webcast at sarah.com, and your recording will be archived in the investor section of our website. Please note that some of the information presented today may contain projections or other forward-looking statements about events and circumstances that have not yet occurred, including plans and projections for our business, future financial results, and market trends and opportunities. These statements are based on management's current expectations and the actual events or results may differ materially and adversely from these expectations for a variety of reasons. We refer you to the documents the company files from time to time with the Securities and Exchange Commission, specifically the company's annual report on Form 10-K, its quarterly reports on Form 10-Q, and its current reports on Form 8-K. These documents identify important risk factors that could cause actual results to differ materially from those contained in our projections and other forward-looking statements. I will now turn the call over to Zhenya. Thank you, Jennifer, and good afternoon, everyone.

I will start with an overview of our 2025 progress, and Lee and Tiffany will speak about our commercial and medical affairs efforts, and Austin will provide a recap of our financial results. As we shared last year, to support Sarah's next phase of commercialization, we strengthen our leadership team, with Lee Anderson joining us as Chief Commercial Officer and Dr. Tiffany Inglis as our Chief Medical Officer, enhancing our commercial and clinical depth And I wanted to use this opportunity to introduce them to all of you in today's call and have them discuss our progress with you. 2025 was a critical year for SARA, finalizing our prime publication to advance our evidence portfolio, setting up for commercial push in 2026, building our organization, ensuring we have capital to deploy in our commercialization efforts, and laying groundwork for potential international expansion. Our goal was simple. to build the evidence, access, and commercial infrastructure required to drive preterm adoption at scale. Across all of these dimensions, we made meaningful progress. We began 2025 focused on strengthening the clinical and scientific foundation supporting our commercialization strategy, the presentation of prime study at society for maternal and fetal medicine meeting in Q1. A major milestone followed as expected late in the year when our pivotal prime study was accepted for publication in December with a full manuscript published in January, 2026. The publication reported important new data showing that the prime study resulted in an easing 56% and 32% fewer babies born before 32 and 35 weeks of gestation respectively. The full peer-reviewed publication of PRIME in the pregnancy journal of Society of Maternal and Fetal Medicine, like studies before it, namely AVERT, reinforces what we've long believed, that biomarker-based identification of women at higher risk of preterm birth, paired with a preventive treatment protocol, can deliver meaningful reductions in preterm birth rates and drive improved health outcomes for babies. As we move into 2026, We plan to extend this momentum through a thoughtful further analysis, publication, and real-world evidence for generation strategy designed to communicate and replicate prime outcomes across diverse populations, geographies, and care models. These data will be essential as we engage payers and broaden awareness across the clinical community. I will ask Dr. Inglis to speak more about our scientific and guideline engagement shortly. Post-publication, we're making meaningful strides in advancing payer coverage and access as our top priority. A central part of the strategy has been launching targeted programs, particularly in Medicaid in high preterm birth burden states, to generate outcomes data that support both clinical adoption and reimbursement expansion. Historically, we referred to these efforts as Medicaid pilot programs. However, with additional real-world experience, It is clear that these programs take many forms, and our discussions involve both Medicaid and commercial payers. As a result, we believe partner programs more accurately reflect the breadth of our commercialization efforts, so we'll speak about those. Last year, we set out to engage with our first wave of six target states and to launch partner programs. We exceeded our state engagement goals in 2025, expanding discussions 13 states, and met our goal of engaging in now two live partner programs. We expect these partner programs to play a critical role in shaping policy, validating economics, and informing future contracting discussions. We're maintaining our disciplines, geographic-focused approach, targeting expansion of up to 15 to 17 states by year-end, representing 58 to 60 percent of U.S. birth This strategy allows us to deepen our traction in our existing target states while thoughtfully adding new ones. With a focused growth plan, we are on track to be running five to seven partner programs by the end of 2026. Lee will detail our execution, 2026 KPIs for states in active discussions and partner programs, as well as how we expect to convert engagements into coverage pathways. In Europe, We continue to make steady progress towards unlocking a significant, largely unaddressed obstetric care opportunity. Over the last two years, we have advanced our regulatory pathway for the preterm global test and are working towards CE marking approval. We remain on track to submit our European dossiers in the coming months. Importantly, recent European expert commentary published in the Journal of Maternal, Fetal, and Neonatal Medicine reinforces that current prevention strategies miss most women who deliver preterm and highlights our prime study approach as well aligned with European healthcare systems. Alongside ongoing engagement with regulators, clinical leaders, and patient advocacy groups, we're building the foundation needed for successful market entry following regulatory clearance. We continue to expect revenue growth to build gradually as partner programs mature and real-world evidence results are generated and disseminated. will remain disciplined, investing in market access, commercial infrastructure, and state expansion in a measured way. With that, I'll hand it over to Lee to discuss our commercial execution. Lee?

Thank you, Shinya, and hello, everyone. In 2025, we refined a region-first approach pairing payer engagement with OBGYN and maternal-fetal medicine education, health system outreach, and patient awareness to build local market density. That integrated model now guides our early commercialization across all target states. Following Prime's publication, we saw strong interest across the payer landscape. Our team engaged broadly with Medicaid agencies, commercial plans, and related organizations nationwide, leading to a meaningful cohort of payers reengaging to begin or advance internal reviews. These interactions reinforced the value of our partner program approach. a flexible model that adapts to each state, payer, and population. As Jinya mentioned, in 2025, we were in active discussions with 10 payers across 13 states. Looking towards 2026, we expect to expand our efforts to be in active discussions with 15 to 17 states, and we will double the number of payers we are engaged with. As these discussions mature, Our goal is to convert these engagements into positive coverage decisions or formal partner programs that support broader access and utilization. For partner programs, we expect to be running five to seven active programs by the end of the year. We expanded provider education and awareness via peer-to-peer programs, medical center and service sessions, and digital education through leading clinical platforms. building clinical champions and strengthening relationships across OBGYN and MSM practices while supporting early health systems conversations. Operationally, we refined the ordering experience, expanded field education, enhanced onboarding, and are progressing integrations and collaborations so that preterm can be incorporated more seamlessly into the everyday clinical workflows. To illustrate how the model comes together, consider a representative region, We align with the payer on a partner program to evaluate outcomes and economics. We brief the leading hospital system and its OB-MFM department on prime and the care pathway. We also provide targeted onboarding and practice-level tools, so ordering is simple. And we activate a localized awareness effort so that patients and providers understand the why and the how. Over time, we focus on repeat ordering within early adopters. then widen access as results occur and the payer's review process advances. While each region is different, this playbook helps us drive consistent execution without overextending resources. Our near-term commercial priorities are to convert payer discussions and partner programs into contracted coverage pathways using outcomes and economic data. scale repeat ordering within our current early adopter providers and health systems by driving workflow reliability and clinical habit formation, and to expand provider awareness and educational efforts. Before I turn the call over to Tiffany, please join me in welcoming Ms. Adrienne Lugo as the new Head of Sales and Strategic Accounts for SARA. Adrienne brings more than 20 years of leadership experience in women's health and molecular diagnostics, along with a strong track record of building high-performing teams, expanding market access, and partnering with health systems to drive adoption of innovative testing solutions. Her strategic expertise will be instrumental as we scale commercial execution and accelerate adoption of our technology to advance improved outcomes in maternal health. With that, Tiffany will provide a clinical and evidence update.

Thank you, Lee, and good afternoon. Our medical affairs work in 2026 is focused on ensuring PRIME acts as a catalyst for consistent evidence-based practice. We're emphasizing three themes. One is identify risk early in the second trimester before symptoms are present. Second, we deploy a standardized test and treat pathway consistent with PRIME. And lastly, we support improved neonatal outcomes with the potential to reduce avoidable neonatal hospital utilization. We're partnering closely with clinicians on patient selection, timing and care pathway deployment, while expanding our clinical champion network and peer partnerships. In practical terms, Preterm is designed to provide early, individualized risk information from a routine blood draw, information that clinicians can act on through a standardized care pathway. The goal is straightforward. Know who is at elevated risk early, before symptoms begin, intervene with measures that are already familiar to providers and safer patients, and do so in a consistent way that has been proven to support both quality and affordability across populations. The complement prime, we're generating real-world evidence results across diverse populations, care settings, and payer environments. This includes outcomes tracking within partner programs, health economic and outcomes research, assessment of budget impact, population-level analyses for state and payer decision-making, and collaborations with academic centers to broaden the evidence base beyond the prime cohort. These efforts are foundational to guideline inclusion, payer policy updates, and thoughtful adoption. We continue to partner with Society for Maternal Fetal Medicine and ACOG and other payer guideline committees, providing evidence-based packages that include clinical outcomes, safety considerations, implementation data, and economic modeling aligned to each group's evaluation framework. Our goal is to demonstrate how incorporating preterm into care pathways supports early proactive identification of need, complements existing risk tools, improves episodes care quality metrics, and addresses affordability by leveraging a major driver of maternity costs. In addition to these education initiatives, we've also launched a campaign to assist providers in requesting coverage for the preterm test. This campaign is available broadly, with multiple providers confirming submission of requests in four states, and an additional 10-plus providers across all of our focus states in the process of submitting additional requests. Beyond our efforts, several state Medicaid agencies and state legislatures have begun exploring policy approaches to address the significant clinical and economic burden of preterm birth. This could come in the form of a bill, budget appropriation, or coverage from the Medicaid Department mandating that payers cover the preterm test. While we have been engaged when asked to provide education and perspective, these discussions have largely been driven by the state's recognition of the unmet need, their focus on health equity, the impact preterm birth has on their communities, and the financial burden it places on Medicaid budgets. I'll now hand it to Austin for the financials and our capital allocation approach.

Thanks, Tiffany, and good afternoon, everyone. I'll start with our financial results and then discuss our cash runway and capital allocation philosophy. Starting with the fourth quarter, revenue for the quarter was $10,000 compared to $24,000 in the fourth quarter of 2024. As a reminder, revenue remains modest and can fluctuate from period to period in this early commercial stage. We continue to expect revenue expansion as we move towards broader commercialization following the prime publication. Operating expenses for the quarter were $9 million, down from $9.4 million for the prior year period, reflecting our continued disciplined expense management. Research and development expenses were $3.2 million compared to $3.1 million in 2024. With the completion of the prime study, R&D expenses will likely decrease as we focus resources on activities that support commercialization and awareness building. Selling general and administrative expenses were $5.7 million versus $6.3 million in the prior year, reflecting our prudent allocation to targeted commercial initiatives and strategic headcount. Net loss for the quarter was $7.9 million compared to a net loss of $8.6 million in the fourth quarter of 2024. Turning to the full year, total revenue for 2025 was $81,000, up slightly from $77,000 in 2024. Total expenses were $36.6 million compared to $36.7 million last year as we began our strategy of capital reallocation from R&D to commercial activities in advance of time publication. Research and development expenses for the full year were $13.2 million, down from $14.7 million in 2024 and driven by lower clinical study costs following prime completion. Selling general and administrative expenses were $23.3 million compared to $21.9 million last year due to targeted commercial readiness investments. Net loss for the year was $31.9 million compared to $32.9 million in 2024, again, demonstrating our disciplined approach to capital deployment. We ended December 31, 2025, with $95.8 million in cash, cash equivalents, and available for sale securities. Based on our current operating plan and commercialization strategy, we believe this capital will fund the company across significant adoption and commercial milestones through 2028. In summary, 2025 was a year of important financial and operational progress. We maintained tight expense controls, strengthened the balance sheet, and position the company to execute effectively as we move into a transformative year with the publication of Prime and our expected commercial expansion. Before we open the call for questions, I will provide a brief overview of our capital allocation philosophy for the near term. Our approach is anchored in disciplined deployment toward milestones that de-risk the commercial model while maintaining the strength of our balance sheet. One, we'll prioritize market access. making investments that accelerate coverage decisions such as partner programs that include quality of care and health economic outcomes research. Two, focus on commercial scale-up, concentrating resources where we see the greatest adoption potential like regions with payer engagement, clinical champions, and health system readiness. Three, fund additional evidence-generating programs such as RWE and targeted clinical collaborations that could support guideline inclusion and payer policy updates. And four, maintain financial discipline and flexibility. facing spending in line with key milestones and emerging adoption or reimbursement tailwinds. As sales volumes build following payer decisions and broader access, we will sequence certain commercial and infrastructure investments when appropriate. This ensures our ability to preserve runway while supporting a healthy, sustainable ramp from early adoption to repeat ordering. Regarding this last point, concurrent with today's 10-K filing, we reestablished our at-the-market or ATM facility. While we have no immediate plans to issue shares, Maintaining an ATM is a best practice in corporate hygiene for companies at our stage. It provides the optionality of an efficient and low-cost tool to maintain financial flexibility and provide a sustainable ramp as we advance payer coverage, commercial adoption, and key milestones for preterm. With our current cash position providing runway through 2028, this does not reflect any change in the capital allocation priorities I discussed or any near-term funding needs. It simply renews our access to our existing shelf registration and maintains financial preparedness. With that, let's open the line for questions. Operator?

Thank you. Ladies and gentlemen, we will now begin the question and answer session. Should you have a question, please press star followed by the one on your telephone keypad. You will hear a prompt that your hand has been raised. Should you wish to cancel your request, please press the star followed by the two. I would like to advise everyone to have a limit of one question and one follow-up. If you are using speakerphone, please lift up the handset before pressing any keys. Your first question comes from the line of Andrew Brackman with William Blair. Please go ahead.

Hi. Good afternoon. Thanks for taking the question. I want to go back to something Lee said in his remarks, sort of a bit around sort of converting payer discussions and programs by using sort of outcomes and some economic data. Can you maybe just expand on that a little bit, just sort of in practical terms? How does that work with each of these partners? And then typically, what do you expect that these partners will look for in these results to sort of move forward with some of those contracts that you might expect? Thank you.

Sure. Thank you for the question. I'm also going to list Tiffany on this as well. But by these partner program approach, excuse me, you know, you take an entity that's interested and they look at the clinical outcomes. They're also going to look at their books and their numbers and their patient population and equate that to the economic benefit that if they adopted preterm and the treatment regimen as standard of care, what could that do for their patient base, so to speak? So as we have these discussions, we are not only highlighting the clinical outcome improvement, but also the health economic outcome improvement. And that's, as you can imagine, very important for state Medicaid agencies or providers throughout the country.

Yeah, I think they would agree completely is, you know, as we look at the results of Prime, And that 20% reduction in NICU admissions, NICU utilization is a huge driver of spend and trend for those who are paying the bill on the backside, whether that's our government or whether that's employer groups or whether that's payers. And so as we think about our partnerships with each of those entities, they've really struggled with how to control that spend and trend. And this is really an avenue for them to have a significant impact on something that drives a large cost driver for many of them, as well as something that drives things like high-cost claimants and things like that in their books. So as we continue to do sub-analyses and evidence generation post-prime, the health economic model and the impact to what that looks like will be something that we'll be able to speak even more deeply about from a publication perspective, but we're able to share with our partners now what that 20% NICU reduction really looks like.

That's really, really helpful. And then I want to go back to the comment made around sort of, you know, SMFM when it was earlier in the year. It's been a couple months now. Can you maybe just sort of talk about some of the feedback that you received at the conference and then since then, you know, how the conversations maybe changed now that Prime is published, you've gone through that conference and sort of where we're at today? Thank you.

Yeah, no, it's a great question. So, the SMFM conference, the national conference was in February of this year. It was shortly after we obviously had our publication go live in the Pregnancy Journal, which is the SMFM Journal. And it was a great conference, a ton of engagement with providers, but also with the leadership at SMFM and really understanding next steps and how we work together and how we make this test more accessible to women. And so we're continuing on those next steps with our partners there, many of whom are investigators on our study have been integrally working tightly with SMSM from day one, including the company itself as well. So really looking at all the next steps, what does that look like, and then opportunities for rapid response or other things like that with those partners so that we can understand what that guidelines and what the changes will look like and how we get to that end point, which, again, is just about access for patients to this test and for providers for this test to be able to change those outcomes for moms and babies.

And I will add, Andrew, that the team has seen a marked improvement in engagement across providers, payers, state legislators, key opinion leaders, societies, employers. The study really proved and gave us credibility. We've long believed can be supported by an RCT-level evidence, and indeed, it's coming to fruition. It's been only about 10 weeks since the publication took place, but we're incredibly excited about the signal we're seeing from all of these audiences. And we'll keep reporting on engagement specifically with the guideline-setting bodies and the signals that we can send to the market about where the standards of care are evolving to.

Again, if you would like to ask a question, please press star 1 on your telephone keypad. Your next question comes from the line of Pedro Peterson with Jefferies. Please go ahead.

Hi, team. This is Lauren on for Tycho. My first question, I guess, is around the cash runway into 2028. How are you guys planning to balance investments in kind of successful U.S. states versus the capital requirements of the global EU launch? And do you kind of expect to accelerate SG&A spend into this year? Thanks.

Yeah, hi, Lauren. Thanks for the question. Yeah, I think we said this in the last quarter, but I'll reiterate some of the basics, and then I'll get into the question. Last year, cash OPEX was in the low 30s. We have budgeted roughly the same cash OPEX this year, and that's with reallocating a significant amount of our spending from our clinical and R&D activities more towards our commercial activities, which does include the work we're doing in the EU, a pretty significant spend that we're doing in the EU to explore the opportunities there as well. Certainly, as the commercial opportunities, domestic or EU, continue to develop, will continue to shift, reallocate more capital from other areas to the commercial side of business.

Great. Thank you. And I guess one more going back to the second active partnership program. Could you elaborate a bit more on kind of the profile of this new partner, whether it's a regional health system, national commercial carrier, and whether or not and how their model differs from your first partnership? Thanks.

Yes. Great question. Multiple partners, multiple partnerships, all of them a little similar, but all of them different. You hit the nail on the head. Yes, we have large health systems, IDNs that we're negotiating with. We have provider payers we're negotiating with. We have large, large group practices. And then we can't forget the prime sites themselves. you know, how do you take this study site from a great study site with Prime and now implement this into their clinical workflow for their entire organization so that it's truly standard of care for any woman that comes in and appears to be low risk for preterm birth, they get a preterm test. So there is a very similar aspects of the model, but each payer partner or each partnership is going to be a bit different. Our goal is to fill the needs of that partner. What works best for them and what are they looking to achieve?

And I will just add that the second partner is an example of an employer collaborative that is multi-state, and we're entering with them in the first state, and there's a great opportunity for expansion. As Lee said, there is a lot of flavors here. We're partnering far and wide from the legislative bodies at the state level to midwife associations to innovative providers of telehealth services in pregnancy. We want to make sure that we capture all of those adopters that are ready to go. Does this help?

There are no further questions. I'll hand the call back over to Xenia for closing remarks.

That's great. Thanks, Vincent. Before we close, I wanted to leave you with how we see the year ahead. With PRIME now published, a growing base of peer and state-level engagement and an expanded leadership team in place, we're entering 2026 with strong momentum. This year is about disciplined execution, advancing all of the partner programs we've talked about, expanding real-world data, and supporting clinicians as they integrate preterm into their workflows. While adoption will be gradual, the foundation we've built gives us confidence in the path forward. We believe the combination of compelling clinical evidence Increasing payer engagement and thoughtful commercial scale-up positions us to unlock meaningful value in a large underserved market. Thank all of you so much for your continued support as we work to improve outcomes for mothers and babies and deliver long-term value for our shareholders. Over to you, operator, to close the call.

Ladies and gentlemen, this concludes today's conference call. Thank you for your participation. You may now disconnect.