Sedana Medical AB (publ)

Hi and welcome to Sedana Medical's third quarter report. With us to present we have CEO Johannes Dahl, CFO Michael Haag and CMO Peter Zake. After the presentation there will be a quick Q&A. For those calling in you can raise your hand by pressing star 9 and unmute yourself by pressing star 6. And with that said I give the word over to you Johannes.

Thank you for the introduction. A warm welcome to our Q3 Report 2026. I'm sitting here with our CFO, Michael Haag, who will take you through our financials in a few minutes, and our CMO, Peter Sacchi, who will give you an update on our progress in the US. Two things stand out for me this quarter. First, of course, the FDA has accepted our new drug application for review, and has set up a DUFA date on April 16th, 2027. So our biggest growth opportunity, the U.S. has moved another important step closer. And second, we are back to growth after a flat first half of the year. Group sales grew seven percent at constant exchange rates in the third quarter, with Germany improving considerably and all of our other businesses continuing to grow. And at the same time, our cash burn came down quite significantly now that the intensive submission phase is behind us. So let's jump right in on page three, structured Here you see the highlights structured around our three priorities, growing sales in our ex-US business, reaching profitability on a company level, and our US journey. So Q3 net sales were 44 million sick, up 7% from last year at constant exchange rates. That actually makes it the best third quarter we've ever had. But keep in mind that Q3 is seasonally typically our weakest quarter with fewer respiratory patients in the ICUs and also summer vacation affecting the results. The biggest swing came from Germany after a decline of 18% in the first half of the year. We are now at minus two in Q3, so very close to last year's levels. I'll go into what's behind all of that in a moment. and all of our other businesses continued to grow. Other direct markets were up 11%, our distributor business is up 27% and contract manufacturing was up 47%. The latter, the contract manufacturing was helped by a shipment that was delayed from June to July, which I mentioned last quarter. So that is a timing effect and simply the flip side of the softer contract manufacturing number we showed you in Q2. On profitability, year-to-date Group EBITDA improved to minus 7 from minus 10 million SEC last year, and our ex-US EBITDA remains positive year-to-date with around 3 million SEC. In the quarter itself, Group EBITDA was minus 7 million SEC compared to minus 6 last year, but that comparison is influenced by some one-time effects, the biggest one being a one-time adjustment that lowered our selling expense in Q3 last year. And if we adjust for those, our underlying EBITDA in the quarter was actually improved. Cash burn, as I said, came down significantly. Cash flow was around 14 million second Q3 compared to around 30 in Q2. The second quarter was, as you know, the final intensive period towards our NDA submission and responding to the FDA's questions during review, what we're doing now. has so far required considerably less cash. We ended the quarter with 40 million in cash on the bank. And on top of that, we have the 50 million credit facility with a local bank that we put in place in July, which we have not drawn on. And then, of course, on the US, the big one in August, the FDA accepted our NDA for review. That confirms that our application is sufficiently complete for a substantive review and the FDA has set the BDUFA date. So that is the target date by which the agency will complete its review and take a decision on April 16th next year. So now review is underway. Every FDA review involves some uncertainties and approval is not a given, but so far we've had a constructive dialogue with the agency and we are responding to their questions as the review progresses and in parallel our FDA authorized early access programs underway with a few US hospitals already treating patients today. If we then move to the next page, slide four, please, you see the same picture we've shown you before of our multi-year turnaround efforts now updated with the first nine months of 2026. Just to recap, coming out of COVID, we made it a big priority to reach profitability outside the US before launching there. We ran a disciplined turnaround program, cutting significantly into everything that is non-customer facing. So our Swedish headquarter today runs with less than half of the people it used to. While we then reinvested part of that freed up cash into the front line, we've become a much more customer-centric and commercially execution-driven company and are much more disciplined and differentiated in how we invest across our markets, doubling down where we see profitable growth momentum and also pulling back where we don't. We also acquired our main supplier in Malaysia, which has reduced the cost of goods of our main device quite a bit. You can see the results of all of this on this slide. Sales have grown from 123 million in 2022 to above 200 last year, and now we stand at 147 after nine months. At the same time, Group EBITDA has improved from minus 68% in 2022 to minus five, and XUS from minus 65% to positive territory. and keep in mind that the year-to-date number so the 26 number include our seasonally weaker quarters Q2 and Q3 but not yet the fourth quarter which is typically our strongest or one of our two strongest ones. So a consistent multi-year improvement in the bottom line that has also outpaced the sales growth so meaning we keep doing more with less. If we then turn to page five Let's talk about Germany, where we have seen a significant improvement in the performance, even though we're not fully there yet, where we want to be. After a decline of 18% in local currency in the first half of the year, Q3 came in at minus 2%, so very close to last year's levels. A year to date, we're still down 40% in local currencies, which is of course not where we want to be, but the trend is clearly moving in the right direction now. There are two things behind that improvement, and I think it's important to be clear about both. So first, the market headwinds have eased a bit. Robert Koch Institute data show that ICU admissions with severe acute respiratory infections were significantly lower than last year in the first half. In the third quarter, they were still lower than last year, but at least came closer to last year's levels. So a little less headwinds there. And second, and this is what we can control, the acceleration program we've put in place under our new sales leadership earlier this year, the majority of German ICU hospitals are already our customers, representing more than two-thirds of the addressable market. So our biggest opportunity is really to deepen penetration within existing high potential accounts. And there we've done a lot of work. Every key account manager now has clarity on the high priority accounts in their territory. Activities have shifted markedly with the majority of customer interactions now directed at prioritized top accounts. And looking at our priority accounts in isolation, sales to these high potential accounts have actually already shown robust growth in Q3 so they have already performed better than the national average and I take that as an evidence that the approach is working and we will successfully return to growth still early days and we have more work ahead of us to bring Germany back to growth but the direction is definitely right. You then go to page six. This puts it into a slightly longer-term perspective. What you see here is our order intake in Germany, and that's the blue line, and the ICU admissions with severe acute respiratory infections from the Robert Koch Institute in purple. Both are indexed to January 2024, so we can have a good comparison. Also shown as a trailing 12 months. So we take out some of the noise in the data that comes with the high volatility during the year. So every data point here in this graph represents the last 12 months. And now you can have three observations here. First, our sales in Germany have directionally followed the ICU caseload, and that's not surprising. Respiratory patients represent a big share of your typical ICU population, and when there are fewer patients in the ICUs, then customers reorder later and in smaller volumes, and that's what we've seen for as long as we've had lower patient volumes. Second observation is that the sales lag a little bit behind the ICU caseload a bit. So that also makes sense. As you can see, the peak in our sales comes a bit later mid last year than the ICU patients numbers have peaked. And thirdly, since the peak in mid 2025, the ICU caseload has declined more than our order intake, our revenue have declined. Next page, please. Page 7. This is our other direct markets, so mostly Spain, France, and the UK. These markets grew 11% at constant exchange rates in the quarter, 19% year-to-date. In Spain, we continue to grow at a little bit of a softer level than the prior quarters. This is seasonally our weakest quarter. During summer, many ICUs in Spain reduced their capacity, so they operated at reduced capacity. with fewer patients, and you also have a bit of a hierarchy in who gets to take the summer off. So in the summer months, you see a lot of more senior staff on vacation, and ICUs are sometimes run by more junior doctors and nurses that are sometimes a bit less familiar with our therapy. We've seen a little bit of that effect during the quarter. But year to date, Spain is still going strong. Strategically, our focus in Spain remains the same. So we're trying to establish inhaled sedation with isoprene as a standard in as many hospitals as possible and driving penetration specifically in neurological units following the positive neuroconda study. France was the fastest-growing market in the quarter, driven again by the continued uptake in the APHP network. So those are 38 university hospitals in and around Paris where our sedaconda isoflurane had been blocked until earlier this year. And we've made some good progress also in other high-potential accounts, for example, in the Lyon area. We also had the listing of our drug renewed in the tender with Uniarchat. That is actually the largest French public hospital purchasing group. So a series of good news here and also the restructuring that we've been going through is nearing completion with a new country manager that will start now in just two weeks in November. In the UK, sales are up, but only modestly in the quarter. Penetration is still lower than in other countries and we still see a lot of growth potential. We are changing our geographical footprint a bit to bring our key account managers location better in line with the growth opportunities. And going forward, we'll have a stronger presence in London and the Southeast where many of the high potential hospitals are concentrated. Page 8 shows our distributor markets, which continued their solid growth trajectory, growing 27% at constant exchange rate this quarter, 23% year-to-date. And once again, growth was driven by positive development in both South America and the Kingdom of Saudi Arabia. This builds on the groundwork we laid last year, providing very targeted support to prioritize partners and at the same time also terminating several distributors that weren't contributing as meaningfully. Then let's switch gears on page nine and look at the US. As you know, this is our largest growth opportunity. Comparing it with our current direct markets makes that very clear. In the U.S., more than 2 million adult ICU patients are mechanically ventilated each year, and we estimate the U.S. market potential for our products to at least $1 billion, or 10 to 12 billion SEC, as you see it here, roughly three times the potential in our current direct markets. So the day we receive U.S. approval, our addressable markets would essentially quadruple, which is very, very exciting. That higher potential comes from a larger number of ventilator beds, a medical practice that favors intubation and mechanical ventilation more than we have it in Europe. and also a generally higher price level, although we haven't built in any price premium into that estimate yet, so there could be additional upsides there. And just to illustrate, if we were to reach a penetration level close to where we are in Germany today, we would be looking at sales of around 1.5 billion SEK in the US, which would change the trajectory of the company completely. Page 10. Just a brief reminder of our launch strategy. We continue to believe we will create the most value by launching in the US ourselves through our own commercial subsidiary. That way, we keep control of our asset and capture more of the upside. And by achieving proof of concept in the US, we increase the value of the company further. And at the same time, we keep the option open to add complementary partnerships at a later stage if we were to create even more value that way. That approach, we believe, works despite the market size in the US because the US is fairly concentrated, less than 5,000 hospitals with ICU care, roughly 2,800 with more than 10 beds, which for US standards is still very, very small units. So we can pursue a very targeted launch built around the network of key opinion leaders and the roughly 30 clinical trial sites we've already established, which are very supportive of the therapy. During the review period, we are also working on launch preparations already. We've just completed pricing research and further fine-tuning our go-to-market model. But of course, all of that depends on approval. So let's look at where we stand in the FDA review on the next page, page 11. That shows where we stand right now. The foundation, as you know, is our two successful PIVOTL Phase 3 trials, INSPIRE ICU 1 and 2. Both met their primary endpoint of non-inferiority to propofol with no new safety findings, and we expect meaningful differentiation from the secondary endpoints and PK data, which Peter will go through just in a moment. On the regulatory side, We have fast-track designation and early access program is underway, and we continue to see good interest there. And then we submitted the NDA in June, which in August got accepted for review by the FDA. And we now have a PDUFA date that we're working against, which is in April 2027. So now we are in what's called the substantive review phase, responding to the FDA's questions, and we are also preparing for the inspections that are part of any review, building on the mock audits we've already done with former FDA inspectors. And as I said earlier, every FDA review has some uncertainties, but so far, I have to say the dialogue has been really good and constructive. On the right side, you see why we believe our therapy would fit very well into the US market if we get approved. First, the reimbursement mechanism under the DRG system. Hospitals receive a fixed payment per hospital stay, so they benefit financially if patients come off the ventilator earlier and leave the ICU faster. An ICU day in the US can cost up to $11,000. Second, there's much higher awareness of the opioid risks in the US because of the opioid epidemic. So opioid sparing therapies, therapies reducing the need for opioids are seen as a clear positive. And third, it fits really well with existing treatment recommendations already, such as the CDC's Wake Up and Breathe Collaborative, which aims to get patients, again, off the ventilator sooner and speed up recovery. With that, let me hand over to Peter, who will take you through our clinical data and the medical activities we have underway in the US. Thank you, Johannes.

So, as Johannes mentioned, we met the primary endpoint in We also had a greater opioid reduction in both trials, similar to our European study. This is of significant significance when it comes to the clinical practice and APPLICATION OF THIS THERAPY. OPIOIDS CAUSE A LOT OF SHORT-TERM AND LONG-TERM ISSUES IN ICU PATIENTS, INCLUDING CONSTIPATION, WHICH ALMOST ALL PATIENTS RECEIVE THE TREATMENT FOR, RESPIRE TO DEPRESSION, WHICH CAN DELAY BREATHING TESTS, DELAY EXTURBATION. AND OPIOIDS ARE ALSO ASSOCIATED WITH DELERIUM, WHICH IS DOSE-DELOSE RELATED. There are also indications that opioid doses during mechanical ventilation are associated with a higher risk of persistent opioid use in the year after ICU discharge, so this is of course very favorable to have a therapy that's opioid sparing. Fast return to wakefulness was found in our studies, similar to all the studies that have looked at this endpoint when it comes to isofrene, and this is related to the pharmacokinetics of isofrene. Elimination is completely independent of renal lymphatic function and means that all patients will eliminate the drug within minutes to an hour, similar to the operating room. And this means in turn that the patients can be assessed neurologically with greater certainty can reduce the number of CT scans. Wake-up time is short when you want to extubate a patient, which also is a clinical benefit. I believe that this can be leveraged once this is approved in the US. Also in the trials, we found a numerically lower mortality with isofrene compared to propofol, which of course is maybe one of the most important safety points in a clinical trial of critically ill ICU patients. Moreover, we did find one more ICU-free day across our trials, which could translate into substantial cost-saving. And as mentioned, the elimination of ice cream is almost exclusively by the lungs, but there's minimum metabolism that means the patients with organ dysfunctions, which are very common in ICU patients, eliminate this drug in a reliable manner. So this all fits very well together. If we move to the next slide, please. As many of you may know, the trials, the INSPIRE-CU1 and 2, took place in 31 academic sites across the U.S., matching fairly well the population density in the U.S. Many of these sites are very interested to see this approved and to start treatment with this on a daily basis. We'll move over to the next slide. And some of these sites have also engaged in the Early Access Program. And the Early Access Program is an FDA pathway to make investigational medical products available for vulnerable patient groups before full market approval. And in our case, this relates to the difficult to date patient population. The EAP is open for all hospitals who wish to initiate it, but of course this is also with the start-up phase with contracting, investigational IRB approval and and so on. The benefits of the EAP is, of course, primarily for the patients and for caregivers, but for us as a company, it's also valuable because this means that we are able to continue gaining experience of inhalation in the US. Some of our study sites also are able to keep up their practice with this therapy and become more proficient. And we can also develop everything from supply chain to training and implementation. We have 10 hospitals that have expressed interest and are still interested. We have three up and running and three additional sites initiating in Q4. And then we have a few early 2027. Move to the next slide, please. When it comes to our medical affairs activities in the U.S., Preparing for launch, we have a few different activities. We had an advisory board in August 2026 with a mix of healthcare professionals, experts in the field of mechanical ventilation, sedation and also pharmacy. We discussed, among others, different patient categories and outside Inspire ICU patient population, which is a broad mix of general ICU patients. There was also significant interest in ECMO patients and neurocritical care patients. And these are patient groups that often require deep sedation, often require wake-ups, very difficult to transport for a CT scan, for example. So a reliable, safe drug that is rapidly eliminated and allows for neuro examinations is a perfect fit for these patient groups. There are a number of clinical trials in Europe on these patients, and they're also mentioned in different sedation guidelines, including the Spanish guidelines. So these are patient groups that we believe we will be able to target outside our study population. We also discussed workflow integration in the US ICU setting, which is slightly different from the European one. A few topics that were discussed were gas monitoring and humidification and how to streamline and make our therapy as easy as possible to integrate. And then we have had discussions also on having a hub-and-spoke principle center of excellence that would support implementation broader across other ICUs with less experience. We have a Clinical Pharmacist AB Board upcoming now in November. Pharmacists are key persons in the ICU when it comes to implementing new therapies, including sedation. They are a small group of people who stay in the ICU, which is slightly different from many of the doctors that come for shorter rotations. So their endorsement and their education is very important when implementing a therapy like ours. We'll be discussing everything from P&T committee support, how to manage sedatives and stewardship in the ICU and how pharmacists play a role there, how we can support ICU pharmacists when we launch and also other considerations related to institutional implementation. And besides the ad boards, we're also having scientific exchange with our trial sites and EAP network meetings with those that are up and running and the other sites that are very soon going to be starting. We will start a series of disease-awareness webinars targeting healthcare providers in the US and discussing pain, agitation, delirium management, and we have a number of top key opinion leaders that will be helping us drive these webinars. And finally we are working on the publication of the INSPIRE-ICU trials and we hope to see by the end of this year. We're also doing additional analysis of study data, post-hoc analysis that we believe will provide interesting and valuable data at the time of launch. Next slide, please. So finally, just to discuss a little bit about a recent study that was published in JAMA, the SABE-ICU trial, and it's related to last year's C-SER study, so that study was on ARDS. SAVE-ICU study is an investigator-initiated study without SEDAR's involvement, driven by investigators from Toronto and almost all sites were in Canada. One was in the US. It's the largest study to date on isofrain-based sedation versus IV station. And the target population in this trial were patients with acute hypoxic respiratory failure, which is the GAS EXCHANGE EQUIVALENT OF ARDS, SO WITHOUT A RADIOLOGICAL VALIDATION OF ARDS. THESE PATIENTS WERE SEDATED FOR AN AVERAGE OF SIX DAYS, AND THE PRIMARY END POINT IN THE TRIAL WAS MORTALITY, IN-HOSPITAL MORTALITY, AND THE RESULTS SHOWED 42.5 PERCENT HOSPITAL MORTALITY FOR ICE CREAM VERSUS 43.8 FOR IV, SO JUST 1 PERCENT LESS, LOWER MORTALITY. with isoprene, and at three months, the difference was 3.4% in favor of isoprene. So none of these results were statistically significant, but I'd still say that this is an important counterweight to the CSER study, and contrasts in that patients in this study survived more in the ISO group than in the IB group, and that was different in the CSER study. There was no sign of any renal injury from Isoferrin either, and this is consistent with what we've seen in our trials and what's been published previously. So there is a clear difference between Sivofrein and Isoferrin, and I think this study very well demonstrates that. And in weighting, for our main publication we are also doing to publish on the INSPIRE trials we've been looking at pool data from the INSPIRE studies and in that cohort of patients in those two studies 27% of all patients with acute heart pox and respiratory failure sorry 27% of all patients in the studies had AHRF so 75% of patients receiving isoprene and 50% receiving propofol and looking at the 30-day mortality in those two groups, it was 21.8% for isofrene and 28% for propofol, so a little bit more than 6% difference in mortality. This difference is not statistically significant, but it's still very reassuring. If we think back of the study last year on semaphorein, there's both our own data that's on file and the SaveICU study indicate clearly that isoprene is not something that one needs to worry about when it comes to acute hypoxic respiratory failure. And then we move over to the next slide, and I think it's time for me to hand over to you, Mikael.