CERS - Earnings call transcript Q3 2020

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Operator

Ladies and gentlemen, thank you for standing by and welcome to the Cerus Corporation’s Third Quarter Financial Results Conference Call. At this time, all participants are in a listen-only mode. After the speakers’ presentation, there will be a question and answer session. [Operator Instructions] It is now my pleasure to introduce Investor Relations Director, Tim Lee. Please go ahead.

Tim Lee

operator. you, Thank Good afternoon. for everyone us thank today. joining to like I'd

are part that slides today's we of webcast simultaneously you displaying As can follow.

September You on Obi from www.cerus.com/ir. Chief Chief can the Investor Green, Officer; Jayaraman, Financial Vivek Relations slides access Cerus' announcing and XX, Cerus' third issued a Cerus website Affairs Executive Chief and Officer; With Carol Quality. the the the describing Cerus' Moore, Cerus’ and Greenman, me for release XXXX Senior our are call today Company's Vice President and Officer; Kevin quarter highlights. results President ended of Regulatory business financial the press recent Operating at

release XXXX efforts, trials, our margins, development commercial and product clinical we goals, this as www.cerus.com. related call make ongoing cash future to anticipated Risk and review On future statements in can the activities, growth well as forward-looking introduce a shortly. and for or these expenses, ended our development remind from We uncertainties forward-looking involve launches, operating operations on President event file now, some to to remarks. by for to duty our XXXX, today's a and and You related And September followed than rather pipeline and identified pleasure of of and and Form with Examples closing with are the include activities. Kevin XX-K statements operating growth we'll described future which Company by and will it's results used followed our our events product gross will that and commercial Vivek, differ under remarks and the quarter provide announcement who that materially. Obi future obligation strategy, September results Executive the forward-looking sales, guidance events, update Factors press product those are begin my and regulatory call, I’d copy Obi including historical XX, to our we ongoing will Cerus' could ended and like results, XX, future statements. financial including no financial website Chief from facts update, at performance Form the of to this undertake Officer. development year you in access today's risk and Greenman, and performance, the XXXX They in on future XX-Q our statements. opening actual cause of Obi timing update financial to These forward-looking and

Obi Greenman

Tim, Thank afternoon good you, and everyone.

to particular, we pleased call, preparation awaiting pre-launch PR-Cryo fronts. could FDA fibrinogen PR-Cryo. are think the cryoprecipitated and share We our In both product record complemented anticipated in continued approval decision are top-line commercial performance report happen for EMEA with complex in or execution activities markets. for the which anticipated America million, on month. development Later approval eagerly next your our the all in progress another quarter programs reduced in quarter on with by strong revenue, I’ll the by pathogen Robust gains of we in the $XX.X totaling was driven North

customers we With both blood the platelets by close and technology for in an on of coming compliance our U.S. document are the of to five safety guidance the adoption the bacterial in period a increasing months, center FDA hospital seeing

the comply hospitals think single-step previously Delayed LVDS centers or most gravitate U.S. guidance. and inactivation will to either methods, with have Large we Sampling we noted, blood As Volume towards pathogen

us CMD now, in the to gives think you his availability. advantages standard-of-care. U.S. serology, which remarks. and INTERCEPT comparing offers of blood conviction our market GAMMA third platelet have as our Vivek Our By the When such details discussions that indicate centers our INTERCEPTs additional belief during Testing, provides we on LVDS, replacement hospitals prepared become several results. and with single-step benefits ease rather hopefully than our to the two-step radiation, and quarter that method will the option, Virus of Babesia operational detailing release Testing will had provide the Zika chance press review a technology

navigating blood pandemic on need of the had in how COVID-XX their While increasing customers of Cerus has business, I to team support to with the impact the safety be our supply. an continue our and impressed the challenges is secure these

could the of donor the quarter for solid surge product and As million as Therefore, $XX COVID-XX represent a implicit million. of heading centers. growth into we are of substantial and surge product where and narrowing to the and light XX% rise guidance the $XX operations. the abroad. months, from and are XXXX Vivek XXXX. cases daily U.S. the let will when a range peak, winter QX we into donors revenue million hospitalizations availability here the commercial our In COVID-XX blood the to range over fourth more me detailed full seeing in sales $XX review call With revenue we will in and at impact This $XX XX% uncertainty to between million to head for year both to that, momentum year-over-year guidance turn our staffing

Vivek Jayaraman

afternoon. and good Thanks, Obi,

report XX% the pleasure commercial kit platelet strong and execution America year-over-year echo to increased demand XX% by to resilience, I approximately and platelets another North as quarter as our the of adoption it comments led of American function both teams’ almost is record EMEA in sequentially continues Obi’s North INTERCEPT region. my First, increase.

product and produced blood INTERCEPT out stated INTERCEPT INTERCEPT networks gains were increases U.S. facility We Red Earlier These have the in Red in XXX% four to in five center Tulsa, American of Cross’ of led goal platelets. by supporter first American the Oklahoma strong a to month, this be getting QX their their are XXXX. treated adoption the manufacturing by which Cross, to continues sales largest report to of the year-over-year happy meaningful our

are platelets. of reduced With American Cross now the Tulsa XX sites pathogen online, out facility Red making the XX

conferred guidance challenges increasingly are at relevance this blood FDA value hospitals, its highlighted the nears close reduced being that pathogen recent pandemics. action U.S. compared as economic AABB blood March use understood reduction for earlier of considered ease supply of compliance by XXXX, the COVID-XX added LVDS platelets. toward and the believe the period The we the month of and of when the end blood learned and Meeting virtual by relative their to centers lessons Annual added the protecting overall future As centers experience and integrity of operational

compared plan life the components COVID-XX days even sites. day it like, we over beyond over seeking five period life platelets even has continue a We the expect to critical U.S. shelf time. trial for stronger for the to at final day made seven the clinical when pandemic kits lower beyond end are LVDS. conducting current next FDA an at and advantage we’d eventually of Extending pace standard-of-care enroll platelet now months platelet to that better the The becoming for study increase demand potential and study the trays. those to slope the has guidance INTERCEPT for the seven revenue app challenging our management be will in in likely The inventory the shelf stages create we in waste of of XX the of are INTERCEPT the U.S. determinant compliance

a of with bacterial planning contributors. safety We the as to a FDA Increasing year-over-year deal the that organization PMA the France product submission reported commercial first of XX% adds the basis. quarter region, in guidance. We transfusing expansion approval third key solid possible up in indication label quarter with from believe these on product with learn particularly quarter another XXXX XXXX. center revenues manufacturers were revenue that substantial Portugal the FDA for and stakeholders EMEA the are value perspective In now and a this delivered blood hospitals,

were Germany we We pathogen based or year-over-year the blood are has sales COVID-XX kit establish due we inactivated the taken earlier had has the demand quarter COVID-XX helped translated pathogen to for quarter. doses has improved team number pandemic in kit sales EMEA centers year again platelets quarter. calculated in project Plasma contributing this regional in compared of part in decline incremental the world sales once this in the to Plasma the see CCP. growth centers treatable now XX Cerus growth momentum the for around partnered experienced on to into with INTERCEPT for driver the Since described that sales the second for a also CCP. total risk, Convalescent new continued to of to and pleased manufacture The activation

INTERCEPT that course users. the recent spotlight that of center call into do. While transitory, hospital a convert Kevin the and on CCP is as pandemic thing the preparedness third customers long-term these continue right contributions over believe will see and review need for the the customers for to help sales blood their that turn CCP manufacture the of we a that, of efforts With this supporting to financials. to are partners quarter we we I from will our Fundamentally, believe

Kevin Green

doses year. reported $XX.X quarter during quarter. number increase during of XXXX Vivek INTERCEPT $XX.X year-over-year XX% increased to the Thank calculated million of Global platelet prior third and everyone. three at product XX% compared demand product first Today, up through of represents reported over increased million, during revenue recorded third $XX XXXX, platelet last $XX.X for the the treatable The In XX%. totaled number growth you, million increase year and the of worldwide treatable from afternoon, QX good we revenue calculated the months XX% period. quarters, nine million, the continued which first doses of a to looking the

sales, CCP. XX%, of platelet as of driven was of pathogen terms compared to remaining on XX% plasma This kit the noted call largely approximately demand for by QX when sales the XX%. accounted higher the for mix, anticipated accounted while QX plasma proportion accounted approximately for In inactivated for kits kits product platelets total

contract our million and ended month government XX, the year $XX.X corresponding In not included Comparatively, government $XX.X revenue product in nine addition and and three prior $X.X our revenues XXXX million guidance, $X.X totaled million for totaled revenue the respectively. period. period and September contract for to million

Going FDA. to initiative on and expect as enrolling our forward, BARDA whole working the as increase began blood we trial returned continue to revenue we patients by will contract government funded clinical activities have reimbursed

margins margins components $XXX,XXX Gross to impacted our compared a Now, percentage certain margins. gross standards. increased our for exchange manufacturing a to points of XX% of charge for volumes consistent lower charge unit that due levels per Gross period. the period gross On during offset quarter result the reported a meet first year-to-date to And were let’s rates. quality by the partially basis, of failed revenue year of inventory reported approximately nine as company’s and during the XX% the XX%, to was X.X that XXXX. and were move by the months were foreign scale, economies non-routine period or the benefit margins quarter and the prior negatively discussion with costs of of

to operating operating expenses, to expenses, in discuss be of prior continue SG&A expenses the year. largely I’d accounted period. now for gross flat were which quarter approximately and totaled compared during the the year year. million We $XX.X Of relatively prior the compared to to the and margins balance expect million unchanged mid-XXs the the QX like were will for $XX.X total

our expenses the three expenses $XX a well nine $XX.X decline the programs our ended to business. and XXXX, $XX.X to share $XX loss million to U.S. increase primarily prior per The period. On over million was the net SG&A label diluted loss during losses claims three during of Cell XXXX intended program, same of or for Reported and year-to-date spending expand $X.XX flat basis, in COVID-XX and considerably expenses and lower Research to expenses result three net period relatively platelet the or the the loss travel million down million for narrowed year. nine per as a million, marketing-related reported year Reported slight month product months XXXX. first R&D to totaled share the was and prior year-to-date $XX.X totaled initiatives $XX.X compared XX, the period. as QX XXXX Blood for first for totaled million a diluted during the September share enhancement net in as The tied share, quarter pandemic. compared in On during XXXX. the expenses remained to period. share, net diluted was $X.XX million to $X.XX compared due per the $X.XX or $XX.X per the development $XX.X a per or year to SG&A for quarters of diluted loss for of period $XX.X quarters For $XX.X compared million, and compared R&D basis, totaled prior million Red million

In cash with third on of the steady the spends. turn expected short-term million to to Cash position our $XXX.X previously ended equivalents to driven gross our margins, narrower from back is $XX With strong we The terms that, approximately be the call full improvement leverage has increased revenues, and let investments by operations in used balance million from compared comments. quarter for to sheet, a Obi hand. been of cash, for the year, SG&A range. million closing me $XX anticipated is over some and and

Obi Greenman

Kevin. you, Thank

supplement, of anticipated their pipeline late like remain Based for open an questions, on November. FDA would I update. PR- decision we with Cryo minutes FDA review conversations PMA during a approval call Before favorable we for spend ongoing providing the to our our a optimistic few the in

the stages building hospitals therapeutic level centers target X We team of regularly bleeding out preparing our and which life them late in threatening events. and are trauma to level at sales manage

anticipated rooms to and and in need ready a a to thaw reminder, fibrinogen transfuse departments blood factors. patients allowing administration shelf with operating five As post in coagulation life, in form emergency be day hospital for can banks, of PR-Cryo other stocked liquid immediate critically bleeding an

product blood began validations center prior partners and sales first distributing Therefore, could the PR-Cryo manufacturing half must in XXXX. completed commercial our approval PR-Cryo that be the hospitals. control necessary we analyses FDA including to anticipated can quality expect Following of began manufacturing performing to the

Regarding intended hospitals. additional application reimbursement Services PR-Cryo, are for the to earlier and an the submitted help for Technology we incremental hospital to to New to Medicaid month Medicare Add-on Payment reimbursement a this cost MTAP. Center offset for provide MTAPs or

in MTAP additional anticipated of year the the XXXX. with reimbursement QX decision allowing We decision an begin on submission expect our next favorable to

filed of for second that of component byproduct note supplement pathogen-reduced we Lastly, will plasma also called a while the a focus This manufacturing our be process. on blood a reduced. PR-Cryo second important cryoprecipitate is is simultaneously launch to PR-Cryo, it’s PMA the that component

may for excited post to our is Thrombocytopenic view with unmet clinical indication We volume explore associated patients possibly in both pathogen-reduced Overall, therapeutic of Purpura utility we proposed have therapeutic change about therapeutic needs and adding or which with or to use transfusion approval. Thrombotic resuscitation, TTP. in plasmic new product Our further apheresis other this we plasma products are find portfolio. areas

the development advancing. Moving modules process. our planned submission two the the part on second are U.S., to first in Red Blood two submitted The X two of in XXXX. quarter the Cell for program, Europe, our In studies Mark review as planned Phase as final we CE modules of are

the the enrollment site pandemic pace we trial anticipate While regard uncertainty clinical COVID-XX to of ongoing and continues, with new activations.

the Cell regulatory documentation to X believe of will benefit the Red PMA that scale future prepared trials is as from U.S. it the submission, Blood We the a PMA completing previously work. program process CMC the submission all for As gating significantly consequence, Phase commercial the European in especially a manufacturing relates the item and for for timeline. the submission

ensuring been the Cerus can the on blood role In provision role Alongside Red the BARDA a COVID-XX of FDA’s earlier sales and back the clear future advocacy commitment focus this the the for month, received nation. a program, execute positioned another to foundational challenges to the Q&A strong an healthcare. record the top-line, of over operator critical the beneficiary supply the and for funding inactivation safety and blood threats. has our the million believe for Finally, quarters pathogen support its have enable to We from in that for development funding given as blood. work let as turn call as this availability, indication the the in to as even against our a Blood of over through is INTERCEPT we me of we pandemic $XX strategy play government team novel that, the we the company the whole blood pathogen coming technology the pandemics of yet With inactivation goals prepare our closing, resilience Cell for U.S. the for safeguard of all technologies FDA U.S. relevance bottom-line pipeline to

Operator

comes of [Operator Instructions] line And Matthew our first the Blackman from question with Stifel.

Matthew Blackman

want around COVID it to follow-on Maybe guidance, the that Is in called if that an the the from impact that full comment coming I I year Kevin see would and is look to And even second you the start or with at third fair? the to performance sort that out, on growth U.S. narrower I that quarter potential inflection, U.S. understand than quarter. for more range geographic just particular steep the really here much is, in you you seem Europe sense the headwind of first of the

maybe part pause? potentially what in the wondering you of So, bit of that year little on gives a the going latter here

Kevin Green

Thanks, I’ll chime that Yes. in then ask latter to and question. the with part start Vivek of Matt.

I going coming think what magnitude. concern we the cases hearing we But to really that or see for spike a to growth you we quarter want of are bit here with to long be hit and in we continue COVID expect out and really conservative quite that of how the right beyond. strong sure in news U.S. are or and will are the largely, and Europe fourth not where continue and that’s at

guidance. you of I to it’s on part narrow question. in ask prudent range if to the And the chime we Matt’s last And felt of can so, then, Vivek,

Vivek Jayaraman

dialing for I’d in. question for Hey be to. happy thanks Sure. thanks Yes. the and Matt,

and will In out, continue are in expect as I and we accurately to growth both strong expressed an a of experiencing beyond. room growth ongoing think grow. quarter of fourth Kevin still that to we sites the room pointed Right, that – think dynamic strong there U.S., U.S. so be the you the and of amount it I Part head is the function the well. is in

that’s little to the those where Western just earlier a will Europe and we procedures of a at or of saw and these elective are anticipate procedures all postponed procedures. coming function total will a we bit. similar of platelet cancelled cautious being number overall year either change bit decline there in a a in end-markets have our off this are bit utilization where We we share And XXX% share the more is platelets what usage hospitals pushing little down

is this heard France and on into need there that lockdown for donor to recruitment, coming it really week of that You off also there going because then back some drop seems focusing terms donors in. a in blood note centers

to are you our to play. point at But right growth U.S. continue be dynamic an strong. So, international it’s will principally

Matthew Blackman

saw the they’ve And progress do five is And Red What the as growth I I big said you Okay. has mandates four heard major you feel the conversations get called of outside similar that that to I drawn. utilization guess, bit how color the Cross more mentioned publicly feedback? in – – of align you banks. confident those U.S. the Cross, you going? in rates But I’ll maybe of four they little that blood very outside Red - are think out increasingly just getting on the more a

those how an us are on conversations going? give update Just

Vivek Jayaraman

happy be Sure. I’d to. Yes.

past the families. towards across distribution as to on we’ve concerted of receiving talked five PR the those is that really their of families things made been which feedback that’s the consistent we’ve big of nationwide center that in intention focus center we’ve blood represent effort And of platelets blood is standard-of-care. north to move about is, all and XX% One a been that the

also really function of where part to around. the offer to on increasing a the on is, things I hospital value they and PR of that is moving understanding the incorporating they their which growth optimization opportunity that of board rate measures in getting improve hospitals and profiles for platelets. differs, platelets But their those timeline can with age clinical margin of Now, think across their an product are towards and PR terms the – platelets what’s them there on been with limit house significant what of contracts getting production is historically those side for we’ve there operational highest and really margin seen that’s the

- time address from So, centers, they channel is five ARC it their make think terms them safety. really over big feedback in how an of is of there, ability cycles explicit checks we go there whether and our platelet PR and it’s to to

Matthew Blackman

Okay. on on to that to enrollment the quick one just then, day about? that base label, that’s that’s that’s last entirely something the push need seven concerned confirm slight one, And out we be going want I given

Vivek Jayaraman

Sorry, go Obi. ahead,

Obi Greenman

final are subjects we a wrapping function QX think, I well we mentioned. underway that’s Yes, targeting and XX in as submission that’s largely those of

submission we FDA are that half year. next XXX in the the assuming a I forward think second we’ll have through claim moves label So, the and that of timeframe optimistic with review day

into will important play a that So, come at very time.

Matthew Blackman

you Thank guys. much very Alright.

Obi Greenman

Matt. Thanks,

Operator

of Thank Josh from the line question you. comes Cowen. And with our Jennings next

Unidentified Analyst

Hi This for you positive curious opportunity Eric technology. was Kong to there has markets. still Josh. I and is was a further while the progress if the on is you. we delivered for Asia, update any summer Hong heard just just I the guys Thank over on China about joint wondering on in the note partner been in those reviewing two potential Japan the guys. in

Obi Greenman

Kong to are something Cross as want in APAC. Hong just happened Red you then doing off And do as what Vivek, getting I’ll what’s on and be far the elaborate we Kong cover going? back in Hong

Vivek Jayaraman

deployed and Sure, we our platelets I’d in past get Kong now those INTERCEPT Kong. Hong What are and Hong be encouraging quarter installed were they producing to. services in this get is in happy able technical team; to illuminators with was

defer sort significant And encouraging for over influential I’ll updates. I specific a China that and view you Japan to that’s think very Asia sway network. a a, that’s us. terms So, of do Pacific and blood there region, really the of then And who check progress in as the customer Obi, an V we has

Obi Greenman

an the Okay. think APAC, in is clearly China awareness and availability. need largest across safety around components supply blood broadly, Yes, more for securing there for globally. be market will time both pandemic I preparedness transfuse the over

are in platelets availability theoretically we’ll there meet China rates to increase platelets overall availability. for in And And strong to overall ultimate is from change also in the see are Most is China. China aphaeresis do the pathogen transformational continuing We ability blood increase there of blood and they safety today current double-digit really of realization a over to the platelet that’s that And growth inactivation pooled demand whole and can’t time, the derived demand. in will required. derived availability. platelets

that’s a point So selling strong us. for

We have other markets, in and continued to major other there. to still China Cross partner the before this the end discussions And are the – hope joint then, a of market hope announce venture Red in year. there something is with

they look Red think specifically what to do across I really with what’s the Cross. American the happens happening globe and

there in out what on rolled United we as increased States FDA time see States. back for the and the awareness I over of United safety think INTERCEPT platelet to should in the so, And the how guidance has on

Unidentified Analyst

And more seven label claim. you. Thank just Great. then, one the in day maybe

experience far? think And the experience so to line the in What So, in claim it’s cause differ? instance at there this anything the for used currently, being countries consider of of the some with that U.S. in some then, that market the is to news I might there. has

Obi Greenman

France We’ve that’s logistics the say, overall at and It’s hospitals. but claim only last, question. in seven with the Eric. also wastage reduces the that Switzerland good experience five Thanks, years over had improves at and the great a something day a center not blood clearly the and Yes. label

inventories, a an increased that INTERCEPT two flexibility. three. to that the but LVDS have the got gives them the with – hard claim that you and going platelet one-step States, earlier day you’ve the time in day centers, the can their have released we remarks, prepared if LVDS In be a United hospitals really at So managing days has potentially blood a remote this referred after seven that still with five has with currently release claim, then option

life as So as isn’t the you’d shelf expect. effective long

seven it life So, get the component. platelet this in the and label claim of effective earlier assuming the longest shelf that U.S. we has day really release

the to customers So, specifically. in we U.S. think it also point and be and for we’ve will Switzerland strong U.S. selling France that a seen benefits confer will hospitals

Unidentified Analyst

you for questions. Thank taking Great. the

Obi Greenman

Thanks, Eric.

Operator

the our of BTIG. line Mark Thank with Massaro you. from And comes next question

Mark Massaro

quarter on and for guys. Congratulations My Hey around is taking my really COVID-XX. question questions. first thanks the

So, of recognizing pandemic at that United you was studies AABB the are inactivation demonstrated INTERCEPT. guidance Or COVID-XX are question, largely of of I signs we are guess, lowering COVID-XX human obviously, clarify of then, certainly and second in that to in Can completely your demonstrated taking a the with I still – also just in Europe? the that that the the wave. that plasma in you at are maybe some seeing conservatism part COVID-XX recognizing in we of the And there that is second States? is we or related one a headwind. know that top-end

am is with business? curious make there inactivation any if exploring to INTERCEPT are COVID-XX I So I was curious opportunity if And actually platelets? your benefit you a for potential to

Obi Greenman

thanks Mark much the for very Well, questions.

am but or sure I the part. not your So, I’ll not. And got then, clearly I’ll me cover it I’ve first understood second if I correct give shot. question, a right

families. the we sort with of COVID And Vivek where specifically, are relates Europe. just mentioned, here relates the QX, in as In prudent So, throughout growth specifically States, and XX% the that’s – resurgence growth we into strong United it effective And of effective to it QX guidance already the that It of we really of that that going the is compliance continue COVID-XX markets to is and as at your the in for just nearing it strong still year-over-year super as know coronavirus look availability to the and in the penetrated shows as like in believe regards period, is seen into a procedures strong we extent clearly to INTERCEPT With to growth. last XXX% a pushed demand was that’s very there allow XXXX. represents out variability inactivating to momentum platelet very either XX% supply or to function question, what pandemic. thought against we getting of does mentioned going elective range. we’ve

threats, as So, for with certainly spectrum really respiratory we’ve as guess, with getting it’s that virus last this your of and because not But COVID. pandemic in part the of affords. the benefit I – as Middle the we what now – technology the inactivation part broad our historically you a question – future MERS it see of done East far the

Mark Massaro

fair. that’s to around also about approval. FDA I want ask No, your expectations the Yes.

that of are FDA? much lifting and forth without of sort around in terms the the heavy and labeling the and largely with late You comments are back innings in here

Obi Greenman

a We a discussion and back today. positive of been and very forth lot had that’s

yes, the ups I I for we is today. sort are can and say don’t month pine we But where cost ask optimism of we Carol the next can to guess, of on sees what have how out overall her that So, to-date. she maybe sort playing

Carol Moore

get of told complete a in are and respond we move they we process question. we like fashion. questions, they’d and point for which good thanks Obi FDA can get we the question we Yes, else are it correspondence we when submission. effective by whatever this information And making. the have very I to progress in have a do targeting to to the the to way is receive and about answer us the think they review opportunity, number email, you, quickly can and on in very at timely to that them an has Thank positive so quickly a that are be

of indication reasonable we very answers think the remain from we FDA concerns we’ll have optimistic So, shortly. and that a It’s complete questions and process set I any there. don’t any of

Mark Massaro

the – just is dipping you question, to I’d And the That’s centers, that this you recognizing great. then, penalty deadline do that of large adoption trying four it’s centers, is for going do am recognize And not my after if XXXX FDA blood centers you’ve of any increase of toe? be total. five I final from rate say to that Or March March? there these approaching. you are in other the other complying least mean, adoption to seeing to or commented at I other Can see for potential broader think speak an you their maybe the how blood is rapidly blood

Obi Greenman

of deadline but see in clearly continued sort time, standard-of-care being that. March adoption We March a in beyond as towards point the

I think, Red they the the Vivek they see how a on XXX%. are already of clearly American mentioned came that XXXX out which sort through looking Cross ramp targeting very

plan the they think be end I they of February. penetrated that mentioned to XX% by

you maybe see add want final So market that’s date. sort around more guidance how timeframe? few of past in comments advance you of a compliance to do the the just Vivek, the evolving March

Vivek Jayaraman

fairly and the contracting, taking the I ensure is when of things accelerating we view I the to terms know label we continue we are you point and centers adoption, in the can and progress. that that that of discussed the about now hospital think the think steps is to highlight certainly around that will I are make they would Red further blood that nature seven have we Cross claim Yes, seeing – the point impact make – other that day

will accelerated the and So, XXXX balance year while the sort XXst, of really beyond no the means rate of calendar you beyond. through fixed adoption guidance adoption compliance the that the what fact March expect in an and XXXX in is by of guidance be deadline we PR the to

be terms what will So, a reason big the this seven of frankly we been and push are and – further preparing that’s day claim in we’ve adoptions. for why big driving label

Mark Massaro

very Thanks much.

Obi Greenman

Mark. lot, a Thanks

Operator

comes Thank of you. And our Johnson line with Stephens. the Jacob from next question

Jacob Johnson

Maybe last comment follow-up the quick on a there. Thanks. just Hey.

platelet this the outlook on that slight near-term some think day prior the in realize doesn’t long-term for push expectations? customers at I all. given this for out change is But platelets, approval, the Just could key I just slow of approval seven in for that versus ramp the timeline the adoption

Obi Greenman

two mean, if I’ll here. I about month or you, are turn Vivek, this talking is that well. we as I Jacob, a think that

and think they in the we are we forward other much And thoughts? in that’s Vivek, what any customers timeframe to still that hearing talked very overall, so, that from looking is claim are about. that XXXX I

Vivek Jayaraman

centers the kits hospitals simply I our and don’t to in a it’s number prior No, near-term of any technology. to needs transacting question. anticipate slowing that to blood fair occur the adopt Yes. activities to for because a be it adoption, position

about measures Cross the and resource our we families are the center talked those needs seeing submission. the at the been making operations that investments with slow which center curve production delays contracting they blood Red at level. ongoing need adopted at the be has optimization of to in on do past to or blood the and and required occur not hospital – to are is the the That due fees are timing So, so activities all of date ahead to but this, also the There other that.

progress see completely So strong by of that lot and or serve primarily other I issues simply because addressed it continued a as that will further accelerant have then at time a what arrives, you’ll think the the either operational point. is you’ll

Jacob Johnson

then, Got for Kevin. it. That And question maybe makes a sense.

I the think of year should mid-XXs. you already be say, in gross margins the for balance the

aware ex you have they to we this takes thinking I be fair about XX% some how of? a quarter inventory need and towards the quarter. think look other charge, there that Are margins? we should Is if would gross be for proxy puts fourth been

Kevin Green

impact was Yes. There gross a about to our X.X% overall margins.

we We good that been product year and right. proxy. that’s last you So, the they have think do have expected are would with trading par that where abnormal were and mix would on

expect we be had we’d demand the I be with forward kits think platelets would numbers a as of that’s we In expect platelet plasma fairly in the the U.S., as that which the discussed historically speaking carry move We reversed we high continue to lower that we seeing QX, fairly to strong. consistent. are and concentration margin,

to course, Of with rates. what’s happen can’t tax predict our we going

wildcard, but a accurate. that’s your So assuming think normalcy, comments I are

Jacob Johnson

Thanks, the taking questions. sense. makes That thanks Kevin and for

Kevin Green

Yes. Jacob. Thanks,

Obi Greenman

Jacob. Thanks,

Operator

Cantor Thank comes from of Our Fitzgerald. Folkes next Brandon line you. Instructions] the question with [Operator

Brandon Folkes

an And situation COVID. deadline, at be we of a the past then, towards get we my with INTERCEPT once some COVID, you adopt else donation in in FDA in second the just Hi. operating deadline, you moving on advantages. quarter then, can to is, you. they with post Sentiss everything they Thank actually the just terms could of the we they question. but And position are given terms end? blood my taking standard in what volume question see a in question elaborate centers from dealing Thanks regarding its earlier are seeing just Maybe just change following where maybe given procedures, INTERCEPT for because where don’t reluctance Sentiss comply or maybe

Obi Greenman

Thanks maybe, a I add for will then can the lot, Brandon question. some and start Vivek comments.

to I that, form. seeing shape in or think, have is what are most They partners INTERCEPT optimize some we it. continue already adopted

are INTERCEPT their as requirements. all and meet they that time well fulfill maximize in hospitals as that have both for the be same have production of from they customers systems to to time, LVDS their even demand will able a to supply so products has of At accept to hospitals. platelets the Red platelets INTERCEPT be to the the treated they just providing So that to period their able can be the hospital communicated Cross seeing that to

pandemic extent. true transitions think So, about as the over that time COVID to question that’s your sort I something hopefully some think, I this of subsides, to is

down of that? platelet really comes I add anything you increase to think, you ability sort it large INTERCEPT Vivek, else just by have of would to to overall and production. optimization their want

Vivek Jayaraman

coming XXXX I you’ll them Cross external implies has think, I the continued market say deadline. what the March I’d in the to progression to stated the XXX% of see intend ample be to just keep captured alone that you think back think they is I explicitly which Red the I that it, but just beyond will that timeframe, XXXX at for

is things nature hospitals them and center blood the contracts and I think of families to think the preparing in key manage inventory, you’ll certainly that see that similar thing is, following a other to I messaging place path. for

Operator

Thank at no this time. And am showing I you. further questions

I’ll So for CEO, that, to with and the further President Greenman Obi turn call remarks. any back

Obi Greenman

again your you for and today Well, thank interest for joining in us Cerus.

in We to will we Virtual month, of you and with Healthcare connect Stephens Investment be Stifel hope Next Thanks the the Conference. Conference Virtual there. participating again. many

Operator

you and for conference. disconnect. Ladies you Thank and today's gentlemen, participating, now concludes may this

Cerus (CERS) 29 Oct 202020 Q3 Earnings call transcript