Release Date: May 02, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Cerus Corp reported a strong first quarter with a 24% year-over-year growth in product revenue, totaling $38.4 million.
- The company successfully met the primary efficacy endpoint in the Phase III ReCePI clinical trial for INTERCEPT red blood cells, supporting future product expansion.
- Cerus Corp is reiterating its 2024 product revenue guidance of $172 million to $175 million, indicating confidence in continued growth.
- The company achieved a significant improvement in non-GAAP adjusted EBITDA, with a much narrower loss of $2.7 million compared to a loss of $9.8 million in the prior year period.
- Cerus Corp generated positive operating cash flows of $2 million for the first quarter, a notable improvement from the $8.5 million used in the prior year period.
Negative Points
- EMEA first quarter product revenues were down 9% year-over-year due to delays and timing of order fulfillment.
- Government contract revenue decreased to $5 million in Q1 from $7.5 million in the prior year period, primarily due to the completion of the U.S. Phase III ReCePI clinical trial.
- The company's net loss, although narrowed, still amounted to $9.7 million for the first quarter.
- Cerus Corp faces uncertainties with foreign exchange rates, which could potentially impact future financial results.
- Regulatory progress, particularly under the MDR process for CE Mark, remains uncertain with ongoing reviews and pending feedback that could affect timelines.
Q & A Highlights
Q: Can you provide more details on the expected revenue growth cadence for the remainder of the year?
A: Vivek K. Jayaraman, COO of Cerus, expressed confidence in achieving double-digit growth throughout 2024, emphasizing the solid performance in both core product lines and the IFC franchise in Q1.
Q: How soon do you expect to see the benefits from the 12-month shelf life extension for platelets?
A: William M. Greenman, President and CEO, explained that while immediate benefits include alleviating supply chain pressure and reducing product obsolescence risks, significant inventory rebuilding by customers is not anticipated in the short term.
Q: What caused the weakness in the international business, and can you provide more details?
A: Kevin D. Green, CFO, attributed the decline in EMEA revenues to timing issues with order fulfillment, which are expected to reverse in subsequent quarters. He reassured that there is no fundamental weakness in the overseas markets.
Q: Can you update us on the regulatory progress in China?
A: William M. Greenman mentioned that the application is under review by the NMPA, and they are awaiting further questions which are expected in the second quarter, which will provide more clarity on the approval timeline.
Q: Are there any updates on the CE Mark under the MDR process for red blood cells?
A: Carol M. Moore, SVP of Regulatory Affairs, Quality & Clinical, stated that they are in active discussions with their competent authority and notified body, working towards completing the application. They are awaiting feedback on their responses to finalize the next steps.
Q: How has the reimbursement for IFC evolved, particularly concerning NTAP?
A: Vivek K. Jayaraman explained that reimbursement primarily occurs through associated DRG cases, and they have encountered less resistance to pricing than anticipated. The NTAP designation has increased clinical interest and awareness, aiding in the adoption of IFC.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
