Petvivo Holdings Inc

Good afternoon, everyone. Thank you for joining us today to discuss the results for the first quarter of our fiscal year ended June 30th, 2026. Sorry, it's for our fiscal quarter ended June 30th, 2026. Hosting the call today is our Chief Executive Officer, John Lai, and our Chief Financial Officer, Garry Lowenthal, as well as myself, John Dolan, PetVivo's Chief Business Development Officer, and General Counsel. Following our remarks, we'll open the call for your questions. Then before we conclude today's call, I will provide some important cautions regarding the forward-looking statements made during the call, such as regarding our company's plans, expectations, objectives and anticipated results. If you are connected to the call via your browser, please also review our State of Harbor statements that are on the screen right now. I will give you a few seconds to take a look at these statements. I would also like to remind everyone that the call is being recorded in order to make it available for replay later today. The replay link will be available to the investor relations section on our website at petvivo.com. Now turning to our results for the quarter. Our first quarter of fiscal 2027 was another period of strong business development and commercial success on several fronts, with key advancements that we believe have greatly enhanced shareholder value and laid the groundwork for strong growth ahead. This has included further development of our IP and technology platforms, further product commercialization, meaningful international expansion, and strategic M&A, as well as the strengthening of our national sales team who have been improving the sales results of the company. All of this has demonstrated our continued intense focus on the many fantastic opportunities we enjoy, several of which come into play only over the last several months. Their pursuit has required extraordinary attention and capital attraction to support their successful development and commercialization. Our primary objective has been and will continue to be the pursuit of high-margin reoccurring revenue streams, which we expect to support the highest valuation of our company for the benefit of our stakeholders. The strengthening clinical validation and market adoption of our flagship product, Spring, with Osseo Christian Technology, continues to serve as our foundation. Upon it, we are working to launch several new products and services for both animal and humans, which have great potential. Many of the activities have included the formation and advancement of new strategic alliances and collaborations with key partners and potential customers. Naturally, the most recent exciting announcement is our entry of an agreement for the acquisition of piezobiomembrane, or PDM, a leading developer of functional biomaterials and piezoelectric technologies which were invented at the University of Connecticut. These biomaterials and technologies have been shown to have uniquely powerful regenerative, restructuring, and or restorative therapeutic applications for both humans and animals. While PBM has been our R&D partner for some time, their acquisition represents a transformative step in our long-term growth strategy. Our merger will more closely combine PBM's great strength in scientific innovation and patented IP portfolio with our own great strengths that include complementary technologies, product development capabilities, commercialization experience, regulatory expertise, and Public Company Infrastructure. We expect our combination to accelerate the advancement of unique, high-value technologies that will serve as the foundation for numerous future products and strategic opportunities. In fact, it has already created new opportunities for securing government and private development grants, research collaborations and R&D tax credits, with the pursuit of many of these opportunities already underway. Meanwhile, we are currently progressing through completing the customary closing conditions and related financing, and we expect to announce the official closing very soon. Meanwhile, we have been working closely with PBM in completing nearly all of the objectives that we set forth in Stage B of our joint three-phase R&D program. This program was created to advance revolutionary functional biomaterials that are designed to promote regeneration, restoration, and or remodeling of damaged or injured tissue and bone in both animals and humans. Stage A determined that our respective products could be combined into a single offering that demonstrates piezoelectric activity with this providing potential therapeutic benefits. Stage B has now determined Our combined offering could be produced at scale and it has provided preliminary indication of safety for administration in animals with a final safety study for this stage to be completed in the near future. Stage C, now underway concurrently, will determine definitive safety and efficacy based on the protocols we've established. After completing Stage C, we plan to pursue FDA clearance of products for human applications that incorporate PBM's piezoelectric substances in biomaterials, including our flagship product Spring, which mimics the extracellular matrix in animals and humans. We recently filed for a federal government grant in collaboration with PBM and the University of Connecticut. The grant is intended to fund the advancement of at least five unique high-value technologies A number of these technologies are expected to serve as a foundation for future products and strategic opportunities. We expect the government's decision on the grant to come before the end of the year. We also recently announced the successful conclusion of our commercial partnership with Vestel that included a license and supply agreement for its Precise PRP product line. While veterinarians may continue to use Precise PRP in conjunction with spring if they choose to do so, Gary Lowenthal

Thank you, John, and good afternoon, everyone. Thank you for joining us today to discuss the results of our first quarter of the fiscal 2027 that ended June 30, 2026. Revenues for the period increased 13% to $330,000 compared to the same year-ago period and also grew 33% revenue compared to the previous quarter. The growth reflected the success of our efforts to strengthen our sales and marketing teams and focus our efforts 100% on selling our proprietary flagship spring product and no longer including our previously licensed Precise PRP FetStem product, which we now no longer sell. Revenues for the period were derived from sales through our distributor network totaling $276,000 with direct sales to veterinary clinics totaling $62,000. This compares to the year-ago quarter where sales consisted entirely of spring and our distributor sales were $198,000 and our direct veterinary clinic was $56,000. We see the significant improvement in sales also reflecting our renewed effort to better educate our customers on the benefits for flagship spring product with the expansion of our sales force over recent months and especially with new sales force members who have greater experience and abilities. We expect this improvement in sales to continue over future quarters. Gross profit for the quarter totaled $223,000, or 66% of revenues, improving from $187,000, or 63% of revenues, in the same year-ago quarter. We anticipate greater revenue margins going forward as we will be selling more of our flagship spring products. with significantly higher gross margins than the discontinued precise PRP product line. Total operating expenses for the quarter decreased 10% to $1.8 million with a decrease largely due to 31% decrease in R&D expense and 9% decrease in general and administrative expense with this offset by a 2% increase in sales and marketing expense. Given the decrease in these expenses, Our operating loss decreased 13% to $1.6 million per quarter. This resulted in the net loss of the quarter totaling $1.7 million, or $0.05 per share, and this improved about 30% from a net loss at $2.3 million, or $0.10 per share, the same year ago quarter. Also contributing to our improved bottom line was a large decrease in interest expense, totaling only $5,000 per quarter. Thank you for joining us. of $668,000 compared to the same period a year ago, as we better utilize our cash. This decrease in cash used in operating activities was primarily due to the decrease of 203,000 accounts payable and accrued expenses compared to the decrease of $80,000 a year ago. Now let's turn to the balance sheet. Cash at the end of the quarter was $123,000, which compared to the $201,000 at the end of the previous year. We expect our cash position to increase as an investor who's subscribed to an equity law firm completes their remaining subscription commitment that totaled $1,350,000 at the end of last quarter. Now, this completes our financial review for the quarter. John?

Thank you, Gary. Now, in addition to our recent activities with PDM, Another key relationship we've been advancing is our partnership with Digitalandia, a pioneer in agentic AI solutions with whom we've secured an exclusive white label licensing agreement for the breakthrough agentic pet technology. This unique and innovative technology features specialized diagnostic AI agents that are protected by proprietary IP and five patents pending. Among this technology's multiple capabilities It addresses many of the critical challenges facing today's veterinarian practices. This includes skyrocketing client acquisition costs and the challenges in capturing the fast-growing demographic of Gen Z pet parents. Veterinarians today are also challenged by what comes after a new client is acquired. That is being able to proactively diagnose their pet's afflictions or diseases and provide best treatment options and to do so cost effectively and efficiently for both the client and the practice. To address these challenges straight on, earlier this year, we data launched our new Petvivo.ai veterinary practice platform. This AI-powered software as a service platform is powered exclusively by Digitalandia's powerful agenic pet technology. We believe it is the first of its kind on the market and its unique benefits and capabilities will provide us a clear first mover advantage. During the first quarter, we advance its commercial rollout with the engagement of an additional select group of prominent veterinarian clinics under our ongoing beta launch development programs. Their inputs of expert knowledge have been further training the platform's AI agents in their main functions of pet owner customer acquisition, and Pet Healthcare. Furthermore, the beta launch has also stimulated a number of incredibly beneficial improvements that are currently being tested and evaluated by the veterinary clinics. Petvivo AI employs automated AI-powered customer engagement that intelligently converts the leads it generates into paying veterinary customers at a tremendous cost savings. The beta program has demonstrated that Petvivo AI can provide a 50 to 90% reduction in veterinary customer acquisition costs, lowering it from the typical $80 to $400 spent per customer target to less than $43. The platform expertly trained AI agents can also analyze a range of inputs, including pet behavior, medical records, diagnostic lab results, and medical imagery such as x-rays, MRIs, ultrasounds and CT scans as well as other patient medical information. It then uses this analysis to assist veterinarians in proactively diagnosing afflictions and diseases such as osteoarthritis and lameness. It also suggests treatment options among which could include spring or future products we currently have under development. Petvivo AI's AI-powered diagnosis has demonstrated an amazing 97% accuracy, with this alone representing a paradigm shift in the medical treatment of companion animals. Recently, our Petvivo AI development team achieved several important technology milestones that we believe strengthens its foundation for future market adoption. We now deployed a highly resilient AI infrastructure with persistent patient memory and introduce smartphone-based diagnostic capabilities that have the potential to significantly expand access to veterinary care. We also launched a data monetization framework for PetVivo AI, creating the opportunity for veterinary professionals to participate in the value generated from anonymized health data while integrating it seamlessly into their existing practice management systems. At the regulatory landscape for digital health data continues to evolve, we see PetVivo AI becoming an important data infrastructure platform that serves the entire industry, from veterinarians and pharmaceutical companies to research and government organizations. And we are now focused on scaling the platform and expanding its adoption with our beta users. This AI-powered solution greatly complements our existing medical device offerings that we market to our existing network of thousands of veterinary clinics across North America and Europe. PetVivo AI also creates a new recurring revenue stream, one with high 80% to 90% gross margins, along with low CapEx global scalability. In all, it provides us with our veterinarian clients multiple ways to win. The final training of the PetVivo AI engine is currently underway using real-world scenarios. A select group of veterinarians practices that we have engaged under our beta program have been providing us valuable feedback and impressive results. We expect to announce its official commercial launch within the next few months. Veterinarians new to the solution can request a free demo of our PetVivo AI website and experienced firsthand how the power of this technology can transform their practice. In support of our launch of PetVivo AI, earlier this year, Digitalandia published a technical white paper documenting the agentic pet AI framework that underpins this technology. The paper validates its technical foundation and provides veterinary professionals, investors, and industry stakeholders with detailed insights into the multi-agent artificial intelligence architecture that enables its transformative clinical and economic benefits. Based on this report, we expect our pet vivo AI solution to rival the adoption of other mainstream AI applications. We see it creating greater visibility for our existing brands, particularly spring with Osseo Christian Technology and the several new solutions in our product pipelines. Earlier this year, we launched on our Pet Vivo AI website an online video explainer which walks you through the two-part ecosystem of Pet Vivo AI. If you haven't seen it yet, we very much encourage you to do so as it will explain why we and others are so excited about this offering. In addition to the work we've been doing with PBM and Digitalandia, We have continued to advance our new partnership with Austin, Texas-based Veterinary Growth Partners. VGP is a management services organization that helps veterinary practices improve their efficiency and profitability by providing management, business development, and marketing tools, and making introductions to new vendor relationships, such as us. VGP has committed to actively promote our Spring with OsteoCushion technology to their member network of more than 7,300 veterinary clinic members across the U.S. We've been focused on product training of the veterinarians in their network, and we're planning to introduce our new PetVivo AI practice management platform to their clinic membership upon its official commercial launch. During the first quarter, our spring lead product also continued to receive favorable reports from veterinarians, especially regarding It's ease of use and effectiveness in the management of osteoarthritis in horses and companion animals. Earlier this year, we announced that Health Canada, the federal agency responsible for regulating health products and protecting public health, officially recognized our Spring with Osseocushion technology as a veterinary medical device authorized for commercialization in Canada. This official acknowledgement will help make Spring available in Canada as a veterinarian-administered intraarticular injectable veterinary medical device that is designed to support joint health and aid in the management of lameness and other joint-related affliction in animals. As the first such recognition by an international regulatory body, this action represents a major milestone in our global commercialization strategy. We are now in the process of developing a new distributor network for Canada We see a great opportunity in Canada where the animal health care market is expected to exceed $4.4 billion by 2031. Moreover, we believe we have first mover advantage in this major market. to receive regulatory recognition from Health Canada, which permits commercialization in the country. We also continue to hear from veterinarians and distributors in Canada that there is substantial pent-up demand for such a product recognized by Health Canada. For this international launch, we believe we have a competitive advantage with our clinical studies, particularly our canine studies. Our clinical data has long demonstrated the advantages of our spring technology over competitive products, including a better long-term safety profile. We have continued to expand the awareness of the benefits of spring, among other key decision makers, including exhibiting at a number of major conferences so far this year. In April, we exhibited our lead products at the International Veterinary Academy of Pain Management Forum held in Dallas, Texas. More recently, we exhibited at the Texas Equine Veterinary Association 2026 Summer CE Symposium that was held in Horseshoe Bay, Texas at the end of July. The symposium brought together some of the nation's most respected equine veterinarians in the country. We were able to demonstrate the research-backed benefits of spring to leading surgeons, sports medicine rehabilitation experts in the veterinary industry. Such introductions are typically significant drivers of product adoption and new sales. We are planning to exhibit at several more conferences later this year, which we plan to announce on our website. Such conferences also present the opportunity to share the results of recent studies like our new canine elbow study, as well as other completed and published studies. Such published studies include a publication in the Veterinary Record, the official journal of the British Veterinary Association, which provided a peer-reviewed clinical study that evaluated our spring with osteo-cushion technology. This publication was the third such peer-reviewed study published so far this year. with this representing another important milestone in the continued expansion of scientific evidence supporting the effectiveness of spring. Over the last several weeks, we have also been advancing the development and publication of new canine and equine studies that address the tolerance and efficacy of spring. This includes the analysis of clinical data generated from our earlier analysis canine elbow pilot study conducted by Orthobiologic Innovations, a leader in R&D for regenerative and sports medicine. The study was led by prominent veterinarians Sherman and Deborah Knapp, who are currently working with our technical service veterinarians to incorporate the results into a white paper in preparation for submission to industry journals. We also have additional canine and equine studies for tolerance and efficacy of spring in the initial stages of development. We also continue to advance our pipeline of new products with this greatly expanded and strengthened with the entry into a definitive agreement related to the acquisition of PDM last month. These new products include new functional biomaterials as well as tissue and bone mimicking biomaterials that may be used to enhance the delivery of pharmacologically active agents and or promote the regeneration, restoration, and or remodeling of damaged or injured tissue and Bone in both animals and humans. Our collagen-alacin hydrogel particles, or what we call CEHM, when combined with PBM technology, can effectively create the structure or scaffolding that can assist in facilitating functional activity in the body to restore, restructure and or remodel its natural tissue. PBM technology enhanced CEHM integrates with the host tissue and assists in the remodeling, restructuring and restoring of that tissue to a more normal and healthier state. Also, animal and human applications could include using our functional biomaterial particle technology for physical and drug therapy treatments via the respiratory system using a nebulizer. We are also investigating potential topical treatments for eye afflictions such as ocular ulcers as well as wound treatment Thank you for joining us today. One which we believe will be transformative and not only for veterinarians and their precious patients they serve, but potentially for humans as well. Looking ahead, we expect to see continued sales momentum and market penetration for the duration of fiscal 2027 and beyond. In fact, we have never been in a better position to accelerate our growth and expand our high growth U.S. international markets. Industry analysts say that the U.S. animal health care alone will double by $11.3 billion by 2030. Such massive growth is unusual for such an already large market, so we see it providing us exceptionally strong tailwinds. As part of our strategy to seize the great market opportunity, we have continued to strengthen our business development and sales teams with key appointments. This includes the recent appointment of Jennifer Douglas as our new field business development manager for the Texas market. This followed by the appointment in May of a new inside sales representative for the Northwest US region. We are also planning to appoint two additional regional business development managers for the Midwest and Southwest regions, which is currently in progress. Thank you for joining us today. to provide some additional insights into the recent developments and then open the call to address any of your comments or questions. John?