Sedana Medical AB (publ)

Hello and welcome to today's Finwire broadcast presentation with Sedana Medical. After the presentation, there will be a question and answer session. So if you have any questions, you can submit them in English using the form on the right. With that said, I'll hand the floor to you. Please go ahead.

Thank you for the introduction and a warm welcome to our Q1 report 2026. Sometimes the development of a company is shown best in quarters where you're facing some headwinds or adverse conditions. We have been through such a quarter in Q1 with significantly less patients and intensive care units in several of our main markets and also a nationwide strike that is affecting our operations in Spain. So for the first time since the year after COVID-19, we're seeing a slight sales decline. But despite all of these factors, we have delivered a positive EBITDA on the group level and double digit EBITDA even in our XUS business. And of course, I prefer quarters where things go a bit more in our favor or the market environment is at least neutral. But this Q1 really demonstrates that all the work we have done in transforming Sedana Medical into a fully customer focused company with a very lean backbone and cost structure is now really paying off. So let's jump right in on page three with the highlights of the quarter and the progress against our three priorities, sales growth, profitability and our US journey. Starting with sales. Last year we reached a new all time high with 200 million SEC net sales for the full year 2025. That was a good result, but also a very unusual pattern that we saw during the year with two very different halves of the year. In the first half, we sold for 107 million SEC, and in the second half, we sold for 93 million SEC. So the first half was 15% higher than the second half. This followed the pattern we have seen in ICU occupancy last year with a very long and severe flu season with a lot of ICU patients in the first part of 2025. but then low levels from May on all the way to the end of the year. So for this year, this means that we are up against an unusually strong comparator in Q1 and Q2, while the comparator in the second half of this year will be lower. And against that comparator, we had sales of 53 million SEC in Q1, which is an improvement compared to Q4 2025 and still the second best quarter we've ever had, but a slight decline there. of 2% at constant exchange rates compared to Q1 2025. Despite that sales decline, we are looking at a profitability situation that I am very pleased with. Group EBITDA was positive with 3% in reported numbers, would have been 5% without the FX headwinds in the quarter. And our ex-US EBITDA was even double digit with 10% in reported numbers or 11% at constant exchange rates. And again, this really shows that we are capable of delivering good bottom line even when the market is going against us and reversely once we are looking at a more favorable market conditions again and we will be back to growth our profitability has the potential to scale very nicely thanks to our healthy gross margins Gross margins were at 71% in the quarter, which is flat compared to last year. But this is also masking the full truth here because both our lower margin businesses, so distributor markets and our contract manufacturing represented a higher share of sales this time, which had a negative gross margin effect. But in reality, we are now enjoying significantly lower cost of goods for our main device following the acquisition of Innovative Secal. And that has a very positive effect on our gross margin. And we had 81 million SEC on the bank account at the end of the quarter, which will be enough to get us to the US. Speaking about the US, there should be Actually, our last quarterly report before our US submission. Everything is on track. We're still aiming to submit the dossier mid-year. And with our two successful clinical trials, with our fast track designation and a positive pre-NDA meeting, we're very much looking forward to taking the next steps towards approval. During the quarter, we also kicked off our early access program with the first US patients now being treated at Vanderbilt University before the actual market authorization. If we move to page four, please, you see all the work that we have done over the last years condensed in one picture, starting with the year 2022, the year after COVID-19, when we incurred the biggest loss in the company's history. That was the time when we made it a priority to reach profitability outside the US before launching in the US. And we started a turnaround program in which we fundamentally changed how we invest our money. So we made significant cuts in everything that is non-customer facing and administrative in nature. Our Swedish headquarter, for example, operates now with less than half of the number of people. And part of that freed up cash, we have then reinvested into strengthening the sales teams. So we are much more focused on commercial execution today. We're much more customer centric as a company and we have more people in the field overall but also here we've applied a very disciplined and differentiated investment approach where we increase spend in countries that are meeting our profitability targets and show good momentum but we also cut back rigorously where that is not the case yet and now you can see the results on this slide we saw a consistent improvement of our bottom line and actually a bottom line that improved faster than sales group. So every year so far we've been able to do more with less. We reached EBITDA profitability for the full year 2025 outside the US and now we're looking at double digit ex-US EBITDA margin and a positive group EBITDA in Q1, which makes this Q1 the best quarter from a profitability perspective that we've ever had. As you will see on page 5, this puts us very well on track to deliver on our financial targets for the year. We guided for mid to high single-digit full-year ex-US EBITDA and now we started the year with 10 or 11 at constant exchange rates. And we also said that we would aim to approach even group level EBITDA break even this year. And now we stood at positive 3% after Q1 or 5% at constant exchange rates. And as every year, we are likely to see some seasonality around these numbers, but we are very confident to meet our guidance for the full year. Then let's look at the performance per region. Let's start with Germany on page six. When you have a 15% sales decline in a country where your ambition is to grow sales, you obviously have to analyze very, very closely to what extent this performance is explained by external market factors, but then also very quickly focus back on what you can actually control and what you can change to turn around the trend the short answer here is that this quarter was heavily influenced by a very different situation in the icu's during this quarter in germany compared to last year with significantly less patients being treated i will show you show you the data around this on the next page so you can more easily calibrate our performance but internally we have not spent much time at all complaining about the adverse market conditions but instead focused on things within our control that will accelerate growth and make us more immune against quarters with low ICU occupancy. So, for example, we have strengthened our leadership team with a new colleague who comes with a very impressive track record in growing sales, who will be working across all of our countries, actually, so not just Germany. We are working on a territory realignment in Germany to allow for even better focus on high potential accounts, which are typically those who are already customers but don't use our products as much yet as their patient demographics would suggest. We know that our customers in Germany cover around 70% of ventilator beds in Germany. So this is where most of the gross potential sits. We're also investing more in sales trainings since many of our field force colleagues are former ICU nurses. They are excellent clinically and probably better than most field forces actually when it comes to clinical skills that are active in intensive care. But there's more we can do in optimizing sales techniques to complement those clinical capabilities. With all of this going on, we will hopefully see the impact, especially in the second half of the year when the comparators, as I said, will become more normalized again. On the next page, you see a comparison of how the flu season 2024-25 and the flu season 2025-26 have translated into ICU admissions. It would be obviously wrong to say that there was no flu season this year. There absolutely was, even one with quite high incidence. But what is relevant for us is how many of these patients are becoming so severely sick that they need ICU care and need to be mechanically ventilated. There are different data sources for hospital admissions, ICU occupancy and so forth. We have analyzed all of them and we know that the best correlation with our sales is the data you see here. This is Robert Koch Institute reporting weekly numbers of ICU admissions with severe acute respiratory infections. And here you see those data for this flu season in dark blue compared to the previous flu season in light blue. And what you can clearly see, that on average, there were less ICU admissions in Q4 2025 and in Q1 2026 than the year before. around the turn of the year there was a brief period when it looked like this season could become worse than the previous one and there was also a lot of press coverage around this as you might have seen but eventually we never reached the peak from last year and the decline started much earlier Bottom line was that we had 22% lower level in Q4 and 15% lower level in Q1. Now our Q1 sales in Germany were affected a bit by a mix of both of these because we typically see a few weeks lag until higher or lower ICU occupancy translates into higher or lower orders. And when the ICUs are more empty, then ICUs tend to order less and also later, which is exactly what happened in Q1. And what came on top here is that this, I would say, mini peak in the end of 2025. During that period, we had some larger orders come in just before year end in anticipation of a really bad season, which then didn't. materialize and affected reorders in Q1. So that explains why we had a 15% lower sales in Q1. But again, quarters like this will happen. There will also be quarters that go the other way. But in both cases, our focus must be on what we can control. There's nothing we can do about ICU occupancy. So we need to become as independent from this as we possibly can through strong execution and beating the market through some of the initiatives I've been talking about. On page eight, you see the performance of our other direct markets. We grew 7%, which is less than the numbers that you're used to. A major factor here is that the country where we typically see most of our growth come from, so Spain, was affected by nationwide doctor strikes. Since January, doctors across specialties actually went on strike for one week every month, protesting for better working conditions and also better pay. And from what we can see, a resolution of this conflict does not seem very likely in the short term, as the demands are quite a bit beyond what the government will be able to accept. And the strike weeks have actually already been scheduled into the summer. And during these strike weeks, what happens is that ICUs operate at minimum capacity. For us, it is then very difficult to get access to customers. We cannot schedule trainings. We cannot follow up. So that's what's been affecting us in the first quarter. What's very, very positive in all of this is that we still saw growth in Spain during the quarter. Not maybe as much as previously, but still solid double digit growth, which shows the strength of the business we've really built here and the resilient demand, even with reduced sales pressure during those strike periods. France and UK were not fully able to compensate for the Spanish shortfall in UK because the numbers are overall still quite small and in France because we are currently going through a planned restructuring, which has resulted in reduced field presence. The restructuring has the goal to accelerate our growth in France and ideally turn the country into the next Spain and the measures are progressing well. What's worth mentioning also in France is an important win with APHP. APHP is a network of 38 university hospitals in and around Paris. where our pharmaceuticals had so far been blocked. So until now, these hospitals, and again, we're talking about 38 university hospitals, a big potential, could either not use inhaled sedation at all, that was actually most of them, or only with Sivoflurane. And as you probably remember, since the CESA trial, we've seen a decline in Sivoflurane accounts, especially in France, and generally a shift away from Sivoflurane to Isoflurane. So now these hospitals are open for business for us, which is a tremendous growth opportunity for our French team. With Germany being a bit weak in Q1, these countries now represented more than 40% of our core business, so excluding the contract manufacturing business, which is a huge shift compared to the situation only a few years ago where we essentially had Germany and nothing else. So even with a slower growth quarter like this one, the development in our other direct markets remains a great success story. Positive development also in our distributor business on page nine with 23% growth. We've laid a lot of groundwork last year with a much stronger focus on key partners and also a cleanup, I would say, among low-performing partners. This is now showing results. Our prioritized partners are performing well, and we also see good growth in Saudi Arabia, where we have been awarded a tender last year. You know that the sales in that business are a bit more volatile than in our direct markets. But with these achievements, I'm expecting solid growth for the full year as well. Then let's go to the next page and switch gears to the United States. As you know, the US is our largest growth opportunity that becomes very, very visible when you compare the addressable market in the direct markets where we operate today with the addressable market in the US. We have estimated the US market potential for our products to be around 10 to 12 billion sec, which is three times the European potential of our direct markets today. So in other words, the day we will hopefully receive approval in the US, our addressable market would instantly quadruple. The higher potential in the US is because of a high number of ventilator beds, a different medical practice that favors intubation and mechanical ventilation more than in Europe. and also an overall higher price level, even though we have not yet built in higher prices into that addressable markets number here. So that may represent additional upside. Let's go to page 12, please. It goes without saying that we are very convinced of the benefits of inhaled sedation that we have seen over many years in hundreds of thousands of patients. So it will be very, very exciting to bring this therapy to the US when it comes out. to the right launch approach, we continue to believe that we can create the most value if we launch ourselves in the US, capture more of the upside, generate proof that this therapy can be successful in the US and make money in the US while maybe over time keeping the option open to complement our presence with a partnership if we deem that to create even more value. This strategy will create the most value because the large addressable market that I've been talking about is quite concentrated with less than 5000 hospitals in the US that have intensive care units and the number of high potential hospitals is much smaller than that so we can go for a relatively targeted launch approach. building around the great network of KOLs and supporters that we already have in place, thanks to our clinical trials. We also see a very good product market fit, for example, of the proven opioid reduction that our therapy has shown to provide in all of our studies so far. For example, because a reduction in the ICU length of stay is generally an effective driver of adoption in the US. And also, for example, because the guiding thoughts behind existing treatment guidelines that they have in the US of things like fast wake up, early mobilization, early ICU discharge are quite in line with some of the characteristics of inhaled sedation with isoflurane. So lots of excitement about the US with the submission coming up very soon. So let me hand over to Peter, to take us through our progress in the US.

Thank you, Johannes. So our preparations for the submission are on track. We have our two US pivotal studies that showed that the primary endpoint was met and we did not see any new, there were no new safety signals in any of these trials. And based on the findings of the study, we expect a good level of differentiation with our primary and key segment points and also the pharmacokinetic and pharmacodynamic profile of Isofren. As you know, we have a fast track designation with the FDA and we had a successful pre-NDA meeting with the FDA in the end of 2025. We have the early access program that is ongoing and we are expecting to submit our NDA to the FDA in the middle of this year. And the standard review time after two-month validation is 10 months. In the case of a prior review, it's six months. There are also medical affairs activities ongoing in the US where some are driven by investigators. For example, we have Only this spring, we have three inhaled sedation reviews published by two trial investigators and one by an institution that was not part of our trial with a positive view on inhaled sedation and sort of preparing the market. And this is completely independent from us. We also have investigators from the U.S. trials presenting at major congresses, both in Europe, at the AC Chem Congress in Brussels, Jeremy Beichler presented in hesitation on the U.S. preliminary data. And we have also investigators presenting at the Society of Critical Care Anesthesiologists in Montreal early May and at the American Thoracic Society in mid-May in Orlando. We're planning to organize a clinical scientific advisory board in Q3, and this will be focusing on the target population, patient categories, where inhalation is considered to provide most value. We'll also be looking at the science, available science, the current data, and discussing with advisors about them. what's available and what might be additional research that they consider to be relevant. And we'll also be discussing implementation and training, such as education curriculums and continuing medication activities to include when EnhanceDation is launched in the US. If we move to the next slide, slide 13. So looking at the trial results, our secondary endpoints showed some benefits. And the most important one is our first key secondary endpoint, where we found that there was a greater opiate reduction with isofrene in both our trials. And this was also confirmed in our European trials. Both the esalaconda study and the isocompost study showed the same pattern of opiate reduction. There is a pharmacological difference. explanation to this. The consequence of reduced opioids is that dose-dependent side effects can be expected to be reduced. Side effects such as constipation, respiratory depression, iatrogenic withdrawal syndrome, delirium. Also, interestingly, a large US cohort study has demonstrated that the opioid dose during mechanical ventilation the very measure we showed reduction with isofrene, that dose correlates with the likelihood of development of persistent opioid use in the year after ICU discharge in non-surgical patients. So that makes an opioid reduction even more attractive in the U.S. The studies demonstrated also fast return to wakefulness. Almost 80% of patients receiving ice cream were awake within 60 minutes after the end of treatment. And we know that with IV sedation, especially after deep and prolonged IV sedation, long and unpredictable wake up times are common. And this implies, impedes the workflow in the ICU, a long time to wait to be able to do neurological assessments or to extubate patients. It leads to patients having to go for CT scans to investigate if there's anything else than sedation that lies behind poor wakefulness. And so this is also a unique aspect of isofrene, which is rapidly eliminated by the airways. We did see some non-statistical trends that are reassuring and potentially beneficial for uptake in the US. So for example, numerically lower mortality in both the two US studies, despite this being a novel potent therapy. Investigators use this and in both studies, we're talking about four to 5% lower mortality, 30-day mortality in the two trials. And then we have some other potential benefits. And all of these things that are non-statistically significant will be subject to discussion with the FDA if they merit placement in the label. But we saw on average one ICU-free day more with isofrene in the U.S. trials together with our European trial and also the U.S. trials alone. And this, of course, is... ICU-free day more means a lot for patients, for families and also for healthcare in terms of work and cost. The pharmacological features of isoprene imply that there's minimal metabolism, that elimination is via the airways and completely independent of renal and hepatic function. And those are functions that are impaired in somewhere between one third and 50 percent of mechanically ventilated ICU patients. So the features alone of the therapy explain a lot of the benefits that we are seeing in our trials and that will be unique the day we launch. And on the next slide, slide 14, we can see the US map where you see the trial sites from the INSPIRE ICU studies. We have interacted with many of these investigators still. Some are in the expanded access program and some are advisors or part of advisory boards ahead. and there is interest and they're looking forward to the time that inhaled sedation will be launched. Many of them clearly want to speak about inhaled sedation and that of course will be possible the day we launch. If we move to the next slide, slide 15. As Johannes mentioned, our early access program has started and the early access program is FDA has granted us the possibility to give away our products to hospitals that are struggling with difficult sedate patients when intravenous sedation fails or when there are significant risks with IV sedation for the patient. And this EAP is open to all interested hospitals in the US. And besides helping these patients that are struggling and that's at risk of adverse events, the Early Access Program brings value because it includes the use in a broad range of conditions, including such that were not studied in our trial. For example, patients on a heart-lung machine on ECMO, just one example. It implies that inhaled sedation, the practice, the experience that has been gained in the trial sites will not be lost. And that is, of course, an advantage the day the therapy will be launched. There will be units that have proficiency and expertise that we can leverage at launch. And for us, it's also an opportunity to practice all the aspects of implementing the therapy in a US hospital. And currently, we have nine hospitals that are interested in the AP. So we're adding on new hospitals. Currently, we have Vanderbilt University Hospital that has treated the first patients. And we have two more hospitals that are going live as we speak. We move over to the next slide from there. So that's slide 16. And here I hand over to Johan.

Thank you, Peter. Yes, so if we switch focus to our financial results for the quarter, starting with net sales, and Johanna has already discussed these aspects here, but just to reiterate the main points. So our net sales for the quarter was 53.4 million SEK. That's 7% down relative to the same period last year or 2% lower if we look at it in constant exchange rates. And as Johannes described, sales decreased in Germany, 15% excluding exchange rates, largely driven by the low ICU occupancy rates that we saw during the period. Other direct markets saw some growth, 7% at constant exchange rate, which is good, but we've seen high growth rates in recent quarters. Johannes described the dynamics there as well. Despite the strikes in Spain, there is still a good growth contribution from that market in these numbers. On the distributor market side, sales increased by 23% at constant exchange rates. And we saw contract manufacturing sales of 2.7 million SEC for the quarter, which is quite an increase compared to the same period of last year. That's mainly due to timing effects in the comparator period of last year, facing effects during the year 2025, essentially. If we look at gross profit, we report 37.8 million SEK for the quarter. That's down slightly from 40.7 million in the same period last year. But importantly, as Johannes also pointed out already, the gross margin remains stable at 71% for the quarter. What we see here is still that we have a positive effect from the reduced cost of goods for our main product, the Setaconda ACD. That's a result of the acquisition and was essentially one of the key rationales behind the acquisition of our supplier in Malaysia. But in Q1 this year this was offset by the mix effect of having a relatively large share of contract manufacturing sales and also to some extent distributor sales in the overall sales mix for us. So, for example, the contract manufacturing part of sales was 5% in Q1 of this year compared to only 3% in the comparator period. EBITDA for Q1, 2026, 1.8 million SEC. So positive group EBITDA, 3% group EBITDA. Margin, ex-US EBITDA for the same period, 5.1 million SEC. Also an improvement to 10% margin EBITDA ex-US. What we see is that we are able to continue to reduce our OPEX. So in this period, Q1 2026, it came in at 43 million SEC, which is down from 46 million in the same period of 2025. And this is really a proof that we are able to continue to find efficiencies in the organization and really limit cost increases that you would that you would be expecting, given the fact that we are growing sales, but we're able to really contain costs in a good way, which enable us to show this improving EBITDA while having these market headwinds that Johannes has described in the first quarter of this year. At the bottom of this slide, you can see how our organization has developed. So at the end of Q1 2026, we had 130 colleagues in the Sedona Medical Group compared to 126 at the end of Q1. So this includes both regular employees, part-time factory operators in Malaysia and also consultants. So I think what's also important to note when we think about the cost savings that we're able to do in the organization is if we exclude innovative Cicals or contract manufacturing or our manufacturing site in Malaysia and look just at the organization excluding those colleagues we see that the number of employees and consultants at the end of Q1 2026 was 80 compared to 86 at the end of the same quarter of last year so there you can see the way that we've further streamlined the organization in particular in the sense of Alinor headquarter over the past year. On the next slide we have our cash flow and available funds. So cash at the end of the quarter was 81 million SEK compared to 91 million at the start of the year. And the change in cash here as you can see is negative 10 million. And that's really mainly driven by investments in intangible assets of 13 million SEK, which is in turn mainly US-related as we prepare for the NDA submission at mid-year. Cash flow from operations during the quarter, positive 3 million SEK compared to positive 6 million in the same quarter of last year. So I continue to see a positive cash flow from operations. The reason why it's slightly lower than the comparator period is mainly due to increased inventory. Cash flow from investing activities in Q1 2026 of minus 14 million SEC, down slightly from minus 17 in the same period of last year. And again, this is driven by US CapEx related to the NDA submission preparations. So total cash flow for the quarter, of minus 12 million sec, same level as the first quarter of last year. And we expect CapEx to remain at the new and lower level over the coming year. And really, once we're through the FDA review period, we expect really quite limited R&D related CapEx beyond that period. So we expect to be sufficiently financed to achieve US approval. And just to point you to the charts briefly on the right hand side of this slide, where you can really see how the reduced cash burn that we've seen in recent quarters have contributed to shoring up the cash position as we now also have reported 81 million SEC for the end of Q1 2026. On the next slide, as usual, you can see our main shareholders at the end of the period. We remain thankful for the support that you provide and we've also noted an increased holding by a few of the largest shareholders in recent months, which is of course very appreciated. And also, I'd just like to add, this is my last quarterly earnings call as CFO of Sedona Medicals. I would like to take this opportunity to thank all our investors and analysts for great conversations and interactions over these past several years. So thank you and look forward to staying in touch in the future. And with that, I will hand the word back to Johannes.

Yes, thank you, Johan. So on that last point, we will have Johan around until approximately mid-June. His successor is already gearing up to take office around that same period of time. And of course, before that, we will ensure a smooth and successful handover. But now to wrap up this presentation before we open it up for questions. and we look at the last page, I see three big reasons to believe in Sedana Medical's success. Number one, and the foundation of it all, is a therapy that makes a difference for critically ill patients every single day. We help them wake up faster, recover faster, communicate with their families earlier, and leave the intensive care unit earlier eventually. And with several hundred thousand of patients in more than a thousand hospitals around the world treated, and more than a million sedation days under our belt we can safely say with some confidence that we are living up to our purpose of improving life during and beyond sedation and every ICU patient has a life that is worth getting back to and no one should be in the ICU longer than necessary so true patient benefit and cost saving for the hospital as well number two we have a growing and profitable core business in Europe and now even showed positive EBITDA on a group level in Q1 and This provides proof of concept that we can make money with this therapy and of course a stable platform for the US launch as we had aimed for all along. And number three, we're now getting closer and closer to the US, which one day should become our largest market as we would quadruple our addressable market upon US approval. And with two successful US studies that Peter has talked about, the FAST-TRACK designation from FDA, the early access program that is underway, there's a lot of positive indicators. So we are hoping that inhaled sedation with isoflurane will benefit also US patients as an approved therapy in the very near future. With that, thank you very much for listening. And we will now open it up for your questions.

Thank you for your presentation. Now we open up for questions. As a reminder, if you are following the report at the phone, you can ask a question by pushing star 9 to raise your hand and I will give you the word. But now we can start with you, Ioannis, Ioann and Peter and all the written questions that you received.

Okay, so let's go through those. So we got a question from Scott Wright. So Scott, thanks for submitting that question. It says, what are Sedana Medical's key growth drivers and strategic priorities for Q1 2026? I can see this question was submitted in the first minute of the of the call so i'm hoping that the call has answered answer those questions already but maybe in in very brief sales performance uh difficult quarter in germany with the sales decline because of less patients in the icu uh lower growth than usual in other direct markets due to the strike in Spain. And on the other hand, a strong quarter in both distributors and contract manufacturing overall, a 2% decline. But what's really standing out, I think, about this report is that nevertheless, we delivered the positive EBITDA on group level. And in terms of priorities, we are big believers of focus. So we are focused on three priorities always. One is safe growth. The second one is getting to profitability. And the third one is getting to the US. And so over the last years, as you've seen in the call, we've made very good progress across all these priorities. Then I will move to the questions from Matthias. Thanks Matthias for submitting those. The first one I'll hand over to Peter. Keen to hear any feedback from professionals at Vanderbilt University so far.

So we do not have any formal feedback in terms of protocol or results from the patients, but already before the Expand Access program, they were very enthusiastic about using inhalation in this very patient group. So the feedback has been positive.

All right, and I'll move on to the next. How long does it take to reap the benefits of the initiatives you are taking in France and the UK? So we are making interventions at different levels. One is kind of across all of our countries with new sales leadership, intensified sales training, a refresher on how to ensure we focus our activities on high potential accounts and don't spend too much time on lower potential accounts and so forth. All of that is being implemented while at the same time, we're also making structural changes, for example, in France. And the beauty about sales is that you can see the effect of these things relatively quickly, meaning after a few months, you know whether things are working or they're not working. So I'm very optimistic about especially the second half of this year. Again, there's a bit of an imbalance in how last year's looked from a sales perspective with a very, very strong first half last year, which we're now up against as a comparator, and then a weaker second half. So in the second half, with all the things we put in place and a more realistic comparator, I think we'll see growth. numbers that are closer to what we're used to. Then there's another question from Matthias. Would you perceive the Q2 comparator quarter in Germany as even more difficult to face? I would guess that the high number of admissions in Q1 2025 helped sales for Sedana in Q2 with a lag. Yes, that is true. So there's a lag of a couple of weeks in between what we see in the ICU in terms of patient numbers and the orders. The quarter two last year in Germany was the strongest one from a sales growth perspective. So we grew 19% in that quarter. So we are again up against a tough comparator in Q2. But then similarly to what I said on the company level, we in the second half are facing an easier comparator. I would say the difference between the two halves of the year in Germany was even more pronounced than on a company level. So on a company level, first half was 15% higher than the second half in Germany. That same number was 19%. So 19% higher sales in Q1. sorry, in the first half than in the second half, which is a quite unusual pattern. So yes, Q2, tough comparator, but after that it's going to get better. And then there's an additional question from Matthias. One additional ICU free day shown as potential benefit. Why is that? Is it something you can do to prove to prove inhaled sedation is numerically favored by one day over standard of care. So if you talk to customers that have been using our therapy, I think what they will tell you is that all these benefits go hand in hand. So patients wake up faster, they're extubated faster, they recover better and faster, and that then eventually leads to them also leaving the ICU earlier. Based on our European trial, we had our post hoc analysis showing a three and a half day difference. Now in the US studies, we also saw a consistently better ICU-free days for isoflurane compared to propofol, but we found one day difference. The difference here that is important to note between the studies is in the German study, the European study, doctors were allowed to leave patients on isoflurane beyond the 48 hours of study duration. So we had patients that were on isoflurane for the full length of sedation and we had patients that were on propofol for the same period of time. So we were comparing apples with apples essentially and that gave us a three and a half day difference in the US. the way the study was agreed with the FDA, everybody was switched back to propofol after 48 hours. So essentially we're comparing one group that was on propofol throughout with a group that was on isoflurane for maximum 48 hours and then propofol afterwards. So that naturally leads to a smaller difference. But I still think intuitively it's quite impressive that with a change of the sedative for 48 hours maximum and everything else being equal, you still get these patients out of the ICU for a day earlier on average. So that I think is going to be a key change. element of how we will be commercializing this drug, not necessarily to the clinical stakeholders only, but also to the purchasing groups and the more administrative parts of the hospitals. Then there is a question From Johnny, what is the estimated total cost of the early access program? So we've not disclosed exactly what that would cost. The way to think about it is we are supplying the products free of charge. So these are not commercial sales, but we are providing them for free. Of course, the cost to us is, of course, much lower than it would be to a company. customer because we only book the cost of goods. So the more patience we have in the program, the more expensive it will become. But in the grand scheme of things, it's not going to move the needle too much. But at the same time, as Peter was describing, it's a very effective way for us to get hospitals up and running before the actual approval. It's a way for us to test our processes. It's a way for us to find our way around hospital internal processes and so forth. So it's a well-made investment from that perspective, I think, even though we don't disclose the exact amounts. Then there's another question from Pear Patterson. Thank you for that as well. How do you see your pricing possibilities in the US if approved? Nice to see the great savings with Sedana therapy, but not so conclusive in the trials. So there's kind of a general and a more specific answer to that. Generally, what you see in the US is that medical device prices are quite a bit higher than in Europe for different reasons. differences can be different in different segments of the market. But if you look at sedation therapies, for example, sometimes the US pays double or sometimes even triple of what is the case in Europe. That's no guarantee that we will see the same for our therapy, of course. But I think the way to think about it is if even if we can only talk about one, only in quotation marks, one day, one additional ICU-free day. An ICU day in the US costs between $5,000 and $11,000 depending on the exact care setting. So there is a significant saving by using our therapy. As a reminder, NICE, so National Institute for Health and Care Excellence in the UK, has confirmed a health economic benefit of 3,800 pounds compared to using intravenous sedation, and that is per patient. So also a quite significant saving. So quite in line with potentially an even higher saving in the US because everything is more expensive in the US. So that will be a very powerful argument, especially since in the US, hospitals are much more effective in understanding the PNL impact of introduction of a new therapy on their own PNL. So they're much more trained to look for differences in length of stay. Those were the questions that I have received through the chat here, but I also see that there's a hand raised on the phone as well.

Yes, there is a number ending with 771. Please introduce yourself.

Hi, yeah, this is Philip from Pareto. So just had a few questions today, but I'll take them one by one. So firstly, perhaps on the strikes in Spain, if you could elaborate a little bit, has that mainly affected like the usage of the device through, you talked about this minimum capacity. So I guess that means fewer patients during the quarter. So is it mainly that, or is it more the ability to further penetrate the market with safe activities that have been, like had the highest impact?

Yeah. Hi, Philip. Thanks for the question. It's a combination of both. So this is a nationwide strike across all specialties. So it's not ICU specific. It's doctors in Spain complaining about working conditions, 24 hour shifts, the pay, of course, and so forth. And I think if you follow the news a little bit, I think This must be probably the largest strike in healthcare that Spain has seen in a long time. And there's talk about, I think, one and a half million medical appointments that have not happened, that should have happened because of that strike and so forth. So overall, big impact on the country. The way it affects us in these weeks, so again, one week every month where they're out of business, of course, patients are still being treated in the ICU, but at a reduced capacity, so less patients overall. So unless it's totally necessary, people will not be in the ICU. And the impact for us is that our salespeople cannot do their daily job. So there's no doctors to talk to during that week. You cannot come for trainings because there's no time for that. If you're starting up accounts, there's no way to follow up and be with the teams to help them treat patients. Because overall, just the access is very, very limited. restricted. So it's both less patients, but also mostly the access that is the problem for us. But again, despite that, I mean, essentially, Spain was on strike for one in four weeks every month, right? So 25% or so of the time was not effective in that sense for us. And still we were able to deliver growth, which I think there's a very positive message in that as well. Now, of course, we're hoping that these strikes will be over quickly. The way it looks right now, it's more likely that it will take some time because the demands and what the government is ready to offer us is still very far apart.

Okay. Yeah, that makes very good sense. So the kind of limited ability to get back to growth in Q2 as well? Or do you see it could go into Q3, Q4 as well?

Well, now this is pure speculation. Q2, probably we will see a similar situation also because the weeks have already been scheduled. So the doctors already know when they will be on strike. So recommendation is not to get sick while on vacation in Spain. At some point, I guess one of the parties has to move, and the comments you get from people who are closer to this than I am, is that since doctors get less money during these strike weeks, at some point the demands will have to become higher. more realistic from a perspective of what the government can meet. So probably we will see the same in Q2 and then Q3 will hopefully be solution mode more than strike mode. But again, speculation, I can't look into the future.

I know, thanks for that. Then just a question on the gross margin, so 71% which is in line with last year and then back at levels that you had before the acquisition. You covered the reasons, you know, the product mix, but can you say what the gross margin would have been if you would have had the same mix as last year?

Well, we typically don't provide that type of granularity on the gross margin, but I think one One guidance that perhaps could be useful to you as an analyst would be to say that the contract manufacturing margin that we have is roughly half of what we have for our core business. So then of course, if we have one quarter such as Q1, 2026, where the contract manufacturing accounted for 5% of total sales instead of like last year, 3%, Of course, that has a bit of an overall headwind for the gross margin.

All right. Thanks. Then perhaps another question to you, Johan. I don't know if you want to answer this, but the increase in inventory, you talked about that a little bit and I saw it in the report as well. So are there any specific effects of this? Increasing the inventory ahead of the US launch, or is it to have some buffer for potential supply disruptions with everything that's going on at the moment?

Yes, so it's two things really. One thing is that, as you know, we are continuously working with trying to find improved efficiencies and lower prices in our supply chain. When you make changes there temporarily, you might need to increase your inventory to have a bit more buffer when, say, you you make changes to the supply chain essentially. So that's part of it. And then another part is actually that when we were in negotiations with our supplier in Malaysia leading up to the acquisition, uh we uh we draw down inventories uh that we are now replenishing to some extent uh at this point so it's not it's not yet any as any inventory build up ahead of the head of the us so it's more sort of temporary corrections great thanks um and then i think the last question that i have

around potential publications from the results, the US results. Are you expecting any sort of publications in the near term?

Yeah, I can answer that. So not in the near term, but they are in this process of being submitted for publication. That, of course, is a little bit unpredictable depending on sort of the impact level you aim for and review time, etc. But we do definitely expect to see them published well before launch.

All right. Good. Thanks. That was all from me.

So there are no more questions at this time. So I give the word to you for some closing remarks.

Yeah, thank you very much for listening. Thank you very much for the good questions and discussions. And I wish you a nice afternoon.