Exhibit 1.02
Cerus Corporation
Conflict Minerals Report
For The Year Ended December 31, 2013
This is the Conflict Minerals Report (the “Report”) of Cerus Corporation (“Cerus”, “we” or “us”) for calendar year 2013 in accordance with Rule 13p-1 (the “Rule”) under the Securities Exchange Act of 1934 (the “Exchange Act”). The Rule was adopted by the Securities and Exchange Commission (the “SEC”) to implement reporting and disclosure requirements related to conflict minerals as directed by the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010. The Rule imposes certain reporting obligations on SEC registrants who manufacture or contract to manufacture products containing conflict minerals which are necessary to the functionality or production of their products. Conflict minerals are defined as columbite-tantalite, cassiterite, gold, wolframite or their derivatives, which are limited to tin, tungsten, tantalum and/or gold for the purposes of this assessment (“Conflict Minerals”). The “Covered Countries” for the purposes of the Rule are the Democratic Republic of the Congo, the Republic of the Congo, the Central African Republic, South Sudan, Uganda, Rwanda, Burundi, Tanzania, Zambia and Angola. As described in this Report, Cerus contracts to manufacture products for which Conflict Minerals are necessary to the functionality or production of those products. Please refer to the Rule, Form SD and the Exchange Act Release No. 3467716 for definitions to the terms used in this Report, unless otherwise defined herein.
This Report has not been subject to an independent private sector audit as allowed under the Rule, which provides a temporary accommodation for the first two years following November 13, 2012.
| 1. | Company and Product Overview |
Cerus is a biomedical products company focused on the field of blood safety. Cerus currently markets and sells the INTERCEPT Blood System for both platelets and plasma (the “platelet system and plasma system”, respectively) in Europe, the Commonwealth of Independent States, the Middle East and selected countries in other regions around the world. In the United States, we are seeking regulatory approval of the INTERCEPT Blood System for plasma and platelets. Both our platelet system and plasma system employ the same technology. Platelet or plasma components collected from blood donors are transferred into plastic INTERCEPT disposable kits and are mixed with our proprietary compound, amotosalen, a small molecule compound which has an affinity for nucleic acid. The disposable kits are then placed in the INTERCEPT Illuminator, an illumination device (the “Illuminator”), where the mixture is exposed to ultra-violet A, or UVA, light. If pathogens such as viruses, bacteria or parasites are present in the platelet or plasma components, the energy from the UVA light causes the amotosalen to bond with the nucleic acid. Since platelets and plasma do not rely on nucleic acid for therapeutic efficacy, the INTERCEPT Blood System is designed to preserve the therapeutic function of the platelet and plasma components when used in human transfusions.
The Illuminator is manufactured by our supplier according Cerus-provided specifications and contains over 400 electronic components purchased from over 50 of our supplier’s upstream component manufacturers. The supply chain for the components of the Illuminator is complex and includes many third party suppliers between the ultimate manufacturer of the Illuminator and the original sources of the Conflict Minerals contained therein. We do not purchase any Conflict Minerals directly from mines, smelters or refiners and do not make any purchases in any of the Covered Countries. Therefore, we must rely on our direct supplier and its upstream component manufacturers to provide information on the origin of the Conflict Minerals contained in the components and materials used in the manufacture of the Illuminator.
| 2. | Due Diligence Effort |
Cerus conducted a good faith reasonable county of origin inquiry (the “RCOI”) regarding the Conflict Minerals contained in the components and materials used in the manufacture of the Illuminator that was reasonably designed to determine whether any of such Conflict Minerals originated in a Covered Country or were from recycled or scrap sources. As a result of such RCOI, we were unable to reliably determine that all of such Conflict Minerals did not originate in a Covered Country or were from recycled or scrap sources and thus conducted further diligence on the source and chain of custody of such Conflict Minerals. Our due diligence efforts were designed to conform to the framework in the OECD Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk Areas (OECD
2011), in a manner that is consistent with our position as a downstream company in the Conflict Minerals supply chain. Specifically, Cerus took the following steps in its due diligence effort:
| • | Determined which Conflict Minerals are necessary to the functionality or production of the Illuminator; |
| • | Partnered with our contract manufacturer to develop and execute a supply-chain survey for direct suppliers of components containing Conflict Minerals, which included the use of third party reporting software; and |
| • | Reviewed survey results, including EICC/GeSI Conflict Minerals Reporting templates completed by component suppliers. |
This due diligence process commenced in the third fiscal quarter of 2013 and continued through May 2014. Cerus’ manufacturing and legal departments were involved in the diligence process and engaged directly with the project team of the Illuminator’s supplier on a number of occasions to obtain information about the upstream supply of components containing Conflict Minerals. Due to the large number of suppliers upstream of the Illuminator supplier, as well as the relatively small percentage of the Illuminator supplier’s business that the manufacture of the Illuminator comprises, Cerus was unable to obtain complete information regarding the source and chain of custody for all of the Conflict Minerals contained in components of the Illuminator. The EICC templates that were completed by component suppliers and provided as part of our diligence effort included information only at the company level (ie: identifying smelters and refiners that process Conflict Minerals for all of the products of that supplier) and did not specify which smelters or refiners were the source of Conflict Minerals in the particular components furnished to the Illuminator supplier for use in the Illuminator. Similarly, the EICC templates did not specify the country of origin for Conflict Minerals in the particular components furnished to the Illuminator supplier. As a result, we determined that we did not have sufficient information to reasonably or reliably identify the particular smelter or refiner that processed the Conflict Minerals contained in the Illuminator or the country of origin of such Conflict Minerals, and thus did not list the smelters or refiners or countries of origin in this Report. To determine the mines or location of origin of the Conflict Minerals with the greatest possible specificity, Cerus performed the due diligence measures described above. Based on the foregoing, for calendar year 2013, Cerus has determined in good faith that Conflict Minerals used in components for manufacturing the Illuminator are “DRC conflict undeterminable”.
Cerus intends to take the following steps to improve its due diligence: (a) continue to maintain close contact with the Illuminator supplier to improve upon having a conflict free supply chain; (b) increase the transparency of our supply chain by determining and identifying the affected suppliers’ smelters and origins of Conflict Minerals; and (c) review supplier contracts to include a clause relating to sourcing of Conflict Minerals.
