Earnings call transcript: XVIVO sees strong Q1 2025 growth, stock surges

XVIVO Perfusion AB reported robust growth in its Q1 2025 earnings call, with net sales reaching SEK 218 million, reflecting a 14% organic growth. Despite a slight miss on revenue forecasts, the company’s stock surged 8.65% in pre-market trading, buoyed by strong operational performance and strategic initiatives. According to InvestingPro data, XVIVO maintains an impressive "GREAT" Financial Health score of 3.18 out of 5, with particularly strong marks in growth (3.94) and profitability (3.91).

Key Takeaways

• XVIVO achieved a 14% organic growth in Q1 2025.
• Stock price rose by 8.65% following earnings announcement.
• Strategic initiatives in the US and new product approvals are key drivers.
• Production constraints for XPS machines expected to ease by Q4.
• Liver technology gains FDA breakthrough device designation.

Company Performance

XVIVO demonstrated strong performance in Q1 2025 with a 14% organic growth in net sales, reaching SEK 218 million. The company saw significant growth in thoracic and abdominal sales, with respective increases of 16% and 28%. However, services sales saw a 6% decrease. The company’s gross margin remained stable at 73%, and adjusted EBIT increased by 50%, achieving a 14% margin. These results underscore the company’s strong operational capabilities despite minor revenue shortfalls.

Financial Highlights

• Revenue: SEK 218 million (14% organic growth)
• Overall gross margin: 73% (stable year-over-year)
• Adjusted EBIT: 50% increase, 14% margin
• EBITDA: 21% (1% improvement from last year)

Market Reaction

Following the earnings announcement, XVIVO’s stock price rose by 8.65%, closing 25.4 SEK higher. This positive market reaction reflects investor confidence in the company’s growth trajectory and strategic initiatives, despite the slight revenue miss. InvestingPro analysis shows analyst targets suggesting potential upside, with a consensus recommendation of 2.6 (between Buy and Hold). The stock trades at a P/E ratio of 58.4x, which appears high relative to peers, though the PEG ratio of 0.69 suggests reasonable valuation given the growth rate. Want deeper insights? InvestingPro offers 13 additional key tips about XVIVO’s valuation and growth prospects.

Outlook & Guidance

XVIVO expects a record year for its XPS programs in 2025, with production constraints anticipated to ease by Q4. The company is investing in its US operations, opening a new R&D and academy in Denver, and preparing for launches in Canada and Europe. The liver clinical trial, targeting 215 patients across 20 clinics, is expected to take 24-26 months. Forward guidance projects EPS and revenue growth through FY2026, with strategic investments targeting approximately a 1-year return.

Executive Commentary

CEO Christopher Rosenblatt emphasized the company’s commitment to innovation and growth: "Machine perfusion and our service model have proven to increase the number of organs to be used for transplantation." He also highlighted the high interest in starting an XVIVO EVLP program, underscoring the company’s leadership in organ preservation technology.

Risks and Challenges

• Production constraints for XPS machines may impact short-term sales.
• The decrease in services sales could affect overall revenue growth.
• Global economic conditions and supply chain issues may pose challenges.
• Competition in the organ preservation market remains intense.

XVIVO’s strategic initiatives and robust growth in key segments position it well for continued success, despite minor revenue shortfalls and operational challenges. With an Altman Z-Score of 15.88 indicating strong financial health and a Piotroski Score of 7 suggesting good operational efficiency, the company appears well-positioned for future growth. Discover more detailed insights and metrics with InvestingPro’s comprehensive research tools and expert analysis.

Full transcript - Xvivo Perfusion AB (XVIVO) Q1 2025:

Conference Moderator: Now I will hand the conference over to CEO, Christopher Rosenblatt and CFO, Christopher Nordstrom. Please go ahead.

Christopher Rosenblatt, CEO, XVIVO: Good morning and good afternoon, and welcome to XVIVO’s earnings call for the first quarter of twenty twenty five. As stated earlier, the presenters today are me, Christoph Rosenblatt, CEO for Xvivo and Christoph Nordstrom, CFO. And with that, we can go over to the second slide, the Q1 financial at a glance. And I’m proud and happy to report that Q1 shows improvement on top line as well as EBITDA compared to the same quarter last year. Q1 shows again that Exviva has a scalable business model with improving margins with scale.

Even though we have continued to invest heavily into the organization for future growth. The quarter was very strong from a North American regulatory perspective with many milestones passed. For example, the liver ID was approved, and we can now start our trial in The United States. The heart cap was approved and the heart trial clinics now have access to the life changing heart technology in The U. S.

For limited amount of patients. And lastly, Health Canada approved our liver and kidney technology, which opened up that market for our abdominal portfolio. If you look at the slide, sales came in at $219,000,000. The gross margin are continuing to show strength, and we have a scale of production set up. We plan to improve the abdominal gross margin to 70% at the latest in 2027 or earlier when we reach economies of scale in production.

The EBITDA shows an improvement to 21%. And Christoph Nordstrom, our CFO, will later get into the details on sales, gross margin and EBITDA. The growth showed a mixed picture during the quarter. In thorax, we see the highest ever interest to start an EBV program, but sales growth came in lower than we expected. Of course, the lack of heart cell, both in The U.

S. Trial and from the European, hampered the growth. The good heart news is that besides that the cap is now approved in The U. S, we also see that heart in Australia is growing very fast with Australian growth of 60% Q1. The penetration last year was approximately 30% for Australia Heart, and we saw a slight increase during Q1.

The high interest and the Australian experience once again show that the heart technology has the potential to change the paradigm of heart transplantation, and we get more and more customer testimonial that, that is the case. The abdominal sales showed strength during the quarter. In The U. S, cat disposables grew 100%, albeit from low levels. And in Europe, both liver and kidney showed strong growth based on excellent clinical and hospital economic data.

We are not pleased with the progress in our U. S. Service business. We have initiated a strategic review of our service efforts that will be finished in June. At a first glance, the Italian model with perfusionist works very well, and we will spearhead a perfusionist model initiative in The U.

S. Already in Q2 this year. We acknowledge that the service business is crucial for the heart launch. And when the strategic review is finished, we will come back with a plan forward for The U. S.

Services business. Lastly and most important to mention is that the projects are progressing according to plan. The heart project is still on time and budget, albeit we didn’t expect a long review from the EMA and the Swedish Medical Agency due to high workload at the two European agencies. The production capacity project, where we invest to scale up volumes times 10 up to date volumes for disposables, are running in line with communicated time lines. The full scale production of disposables for heart, liver and kidney will be extremely important to capture the future growth potential for all three product groups.

And with that, we can go to Slide three, which is the highlights of Q1. The picture in front of us remind us all why we’re here, and that is to make sure that no one dies waiting for an organ. Alex, on this picture, is one of the 400 patients that got the opportunity to heart transplant, thanks to our innovative heart technology. We start with regulatory highlights. So we can quickly go actually to Slide five and the progress on The U.

S. Heart Preserve trial. We are pleased that the continuous access protocol now is approved and that we can give access to the heart technology to the limited number of patients in the trial sites. Besides that, the continuous access protocol will strengthen the clinical file with more patient data in The U. S.

The heart technology so far has surprised us positively every time it has been used and more data will be key to build a solid clinical file. And again, I want to remind us all that the thirteen month enrollment was a record time for a clinical trial, five months ahead of schedule. And it showed the enthusiasm seen in Australia and Europe has also been seen in The United States. With that, we can go over to Slide six and our liver trial, the DELIVER trial. The IDE or Investigational Device Exemption was approved during the quarter for liver.

Key takeaways are that, one, the liver technology is the market leader in Europe and more than 20 clinical papers just during the last twelve months showed superiority in graft survival for both short and long term. Hospital economics, the liver assist saves more than 25,000 per transplant due to lower cost of aftercare. And lastly, by using the liver assist, surgical teams now can not only see better patient survival and hospital economics, but also improved work life balance with morning surgery. The liver growth in Europe is partly driven by the 2024 Cochrane review and 1,200 patient real world data. The Cochrane Review supports the implementation of HOPE with Liver Assist as a routine practice for liver transplantation.

Two) With the IDE approved, we can now start a clinical trial in The US that will form the basis for our PMA application with the FDA. The trial will enroll two fifteen patients at a maximum of 20 clinics. The inclusion criteria for the trial is extended criteria levers, I. E. Very similar to the heart trial we just concluded in terms of patient inclusion.

The work with CMS for site reimbursement and the hospital for both ethical approval and site contract is underway. We know from experience that this work takes some time and the plan for first patient is during Q3 this year. In conclusion, we are very excited that delivery technology has changed the life for many patients in Europe now can be accessible for American transplant clinics under the trial. And with that, we can go over to the last regulatory highlight, and it’s on Slide seven, which is the regulatory highlight from Canada. We during the quarter, we got MD SAP approval and sequentially Health Canada approval for our liver and kidney products.

And we have hired our first employee to facilitate our launch there in Canada. We have a full abdominal team in The U. S. That will support the launch of Kidney Assist Transport and Liver Assist. Canada is an interesting market due to the similar geography to Australia in terms of large distances between hospitals.

Canada is also interesting from a US perspective where surgeons very corporated very often cooperate over the Canadian border, which will be helpful also for the later US launch. So we know that learnings in Canada can be deployed from a surgeon to surgeon basis into The US as well. Lastly, the the heart launch in Canada will depend upon that we first get a CE Mark. And based on the CE Mark, Health Canada will make their own judgment based on on the file and the CE mark. So we have to wait for HEART in Canada.

But we are very pleased that we now can start working with the abdominal products in Canada, where we know there has been an ask for getting our products approved. And with that, we go to Slide eight, which is the overview of where we have regulatory status. And the status is that we are yet are working for approvals for heart in all core markets and liver in The U. S. With the recent good news in Canada, it will be considered core market as of now.

But this slide hasn’t yet been updated to reflect that. And with that, we can go to Slide nine, which is the timeline and the progress of regulatory processes. We see a constant progress, as I think Q1 is a testament to that there is progress in each process, but the key message is the same as last time we met. So I would partly repeat what I said in January 2025. The HEART trial is, as you know, fully included in record time.

Next milestone is the twelve month patient follow-up. In parallel, we will prepare the technical and preclinical file for submission as well as building the clinical file larger with the help of CAP data or continuous access protocol data. After the twelve months follow-up time and some time for database lock, we can start preparing the clinical file for submission as well. As mentioned before, in Europe, we have handed in our technical documentation for review according to our time plan. In dialogue with our notified body, we understood that the heart box is already approved.

This enables us to talk to clinics about the heart box. The insecurity we still face is how fast EMA, which is the European Medical Agency, and the Swedish MPA can handle their review time. They are under a lot of stress due to MDR. So we have not yet full insight into their timelines today. However, we are ready to launch when the product is approved.

So the launch plan is ready, staff is recruited and interest from clinics in Europe is very, very high for the heart product. As I stated earlier in in earlier on this call, in Australia and New Zealand, we have seen high usage of the product. The regulatory approval will be pending the CE Mark in Europe, and the same will apply for Canada. We have initiated DCD data collection in United States as part of the trial in Europe as part of a 40 patient trial, and we will initiate the same type of data data application and trial in Australia as well to get DCD data in Australia to have full usage of the hot box once approved. Lastly, the liver.

We have gone over that one, but we have been granted breakthrough device designation by the FDA. And with an approved ID, we are working hard to get the trial started in Q3 this year. So with that, we can go to the next slide, which is the ISHAT twenty twenty five and the expected highlights, which the ISHAT would be next week in Boston. It’s a key event for lung and heart transplant, surgeons during the year. We will have five days of meetings and, excellent presentation of new data.

The most important speech during conference we deem will be the one year follow-up of the EU trial data. Last year, professor Rege presented a seventy six percent risk reduction of severe PDD, which is the leading cause of early late mortality after heart transplant. This year, he will present how well the patients are doing after one year. So we are all eagerly looking forward to that presentation. We are also looking forward to the NOVEL trial presentation by doctor Sanchez and to our two industry symposia.

Last year, they were packed to the brink of the room and people had to stand up lining the walls. The general view was also that the symposia we led had a higher scientific level than most of the ordinary program, which is a great testament to our marketing team and clinical team who prepared those two symposia. We aim to repeat that 2024 success also in 2025 in Boston. So we will you will hear more of this when we meet next time in July. And with that, we can go over to the business operation on Slide 11, and we can go straight into Slide 12, where we start with the surrounding world.

And the key message is that we will continue to invest to make sure that no one dies waiting for an organ. If we start with trade policies, we see a constantly changing environment, and we have plans for each scenario. In Today, we have production in The United States for the XPS and part of the lung kit, while we produce heart, liver and kidney products as well as disposable and sterile products in Europe. We know, for example, for Perfodex that account for somewhere between 0.20.3% of the total cost for lung transplant in The U. S, that a price increase will not affect the number of heart transplants in The U.

S. But it would be important to keep patient safety always first. And it’s better for for the patient if we have a stable production, or sterile product with good goods that make sure that they will survive lung transplants than if the price is 10% higher than it was today. For machines that are not sterile, we aim to set up dual production. In other words, we have we we will in the future have one production site in The United States and one in Europe.

In terms of investment into the organization, we will continue to invest heavily into The US organization, and we soon open a new r and d and academy in Denver, Colorado. In parallel, we continue to invest in commercial, R and D and regulatory capabilities in The United States. If we turn to the next slide, we go in more to segment updates. And Notion will give you more of the details, and I will give more an overview of where we are and what actions we will take. As stated earlier, Harte is performing very well where we’re allowed to sell the product, which now is Australia.

We are preparing for a new launch. For Lungs, we have seen a very good last year, a softer Q1, with an extremely high interest to start an EVP program. The new commercial force we put in place in q four twenty twenty three have now been up and running for approximately a year, and the key learnings are that, one, we will invest in more clinical reps closer to customer. Two, many customer need on-site support with perfusionist. And hence, we will trial the Italian model, which has been working very well in in Italy with on-site perfusion.

And three, we know the hub models works. We have to encourage more clinics in The US to do what they do in Paris, which is that one clinic or one OPO evaluate lungs for more clinics. The good example we see is that we see a lot higher usage of EBLP lungs around the two lung bioengineering hubs in The United States, which is a testament that HubModus works. I also want to highlight that during the quarter, two great publications were released around EBLP and lungs. One showing that lungs on EBLP showed good patient survival for high risk patients and high risk recipients.

Also, Exviva came out significantly better than a competing product during that trial. The second publication is very encouraged in showing that an EVLP program is economically beneficial for clinics if they perform more than three EVLP lung transplants per year. If we go into the abdominal business, it’s showing good progress in Europe. Liver is a growth driver, but interest for kidney is picking up. Key for The U.

S. Market is to run the liver trial and to develop the kidney product, including acquired clinical data to have true success for our abdominal portfolio. So now we are hitting clinical doors in in or hospital doors in The US, while the majority of kidney profusions are done in the opioids. But that will will take another couple of of of four to six quarters before we have the right product and the right clinical data to really see good performance on CAT in The US. And we can go to the slide 14, which is the last before we go before our CFO takes over, and we look at The US Organ Recovery service.

In short, it can be said there is a large need for organ recovery services in The United States, especially if they’re paired with perfusionist services. So the combined service of an organ recovery service and perfusion is also strategically important for the heart loss in The United States. The other thing that we can conclude is that we are not pleased with the current performance and are currently conducting a full strategic review of our U. S. Services business.

We will come back when that one is finished in June. We are continuing to invest into Flowhawk. So there are in few clinics in The US, but where the Flowhawk software is, it’s very well appreciated and adds value to the clinics. So we will continue to invest into that integration. And with that, I say thank you for this part of the presentation, and we can turn over to slide 15.

And, actually, you will take over, Christopher, from here.

Christopher Nordstrom, CFO, XVIVO: I will, Christopher. Thank you. Yes. So let’s move on to the financial section here. I’m starting with the net sales and key ratios for the quarter.

This was a quarter where sales performance varied a bit amongst our three business areas, and I will shed some light on each area later on. Overall, the underlying trends for our for our current businesses are positive for both thoracic and abdominal as we see as we increase our customer base, and we continue to see a growing demand for technologies. On the services side, as Christophe mentioned, we we we have work to do in order to accelerate these businesses. Worth highlighting is that this was a quarter where we lacked some revenue that we had last year. So, for example, revenue from trials in The US.

And as a comparison, last year, we had 7,000,000 SEK in revenue from our heart trial. We expect revenue from the CABP trial to start gradually here in q one already, followed by additional revenue from our liver trial in q But so to the numbers, net sales were SEK 218,000,000 and organic growth was 14%. If we look at the rolling twelve months as we prefer to do, the organic growth was 33%. Overall gross margin was in line with last year, 73%. Adjusted EBIT increased 50%, that’s that’s a lot, in in in SIC and reached a margin of 14%, strengthened from 11 last year.

And finally, EBITDA was 21%, an improvement over the 20% last year. We did not see any major effects on our p and l from the weakened US dollar in q one. As you know, we have a high portion of our business in The US. And I will provide some comment on this topic in a few slides when we dig down a little bit on the EBITDA. Moving over to the thoracic business area, total sales in q one amounted to 142,000,000 SEK, which is an organic growth of 16%.

The rolling twelve months organic growth is 39%. After a strong sales quarter in q four, from a pure sales number perspective, this quarter was weaker. But a, EVP is not always a a quarterly stable business. We need to live with that as we grow bigger, but and longer trends provide better understanding of the trajectory we’re on. And b, I would provide some useful insight by digging into some details here.

So for lungs, sales grew 18% in local currencies. That’s softer growth than the previous quarters. However, we we we truly wanna emphasize that the underlying health of our e d p business is stronger than this number suggests. Last year’s comparative numbers were to some extent inflated by some research sales. And and this q one, we could not onboard our new XPS customers until the very last weeks of the quarter, which led to some reduced growth to our own forecasts.

But, however, the the quarter finished strongly, and four XPS devices were sold in the last weeks. Right? So two in The US and two in Europe, to France and to UK, by the way. And the the XPS interest remains very high, and we we we truly believe that 2025, it it can really be a record year for us in terms of XPS programs started. As we mentioned in in the report, we will still face some limitations on the XPS production capacity in the next two quarters, and we forecast that we can be able to produce around three XPS machines per year quarter for the year.

But still, I mean, if we if we manage to do that and sell those, it will it will be a record year. Gross margin, I mean, stable, 82%, one percentage unit better than last year. When it when it comes to hearts, it’s interesting and exciting. So sales were 8,000,000 SEK this quarter versus 12 last year. However, we had around 7,000,000 SEK worth of US heart trial last year.

So it means that, you know, set aside The US heart trial, we we we grow quite nicely here. What sticks out and what we’re extremely proud of is the development we see in Australia. So this quarter, they we they brought in 6,000,000 SEK of revenue with a growth of 61% as Christofra mentioned. And it really demonstrates the huge enthusiasm that they have for our technology in that region. So to conclude, thoracic, I mean, heart shows an improved momentum in Australia and also Europe, some compassionate use cases there as well, and we’re awaiting the CE Mark as you know.

Lung had a little bit of a softer quarter, but the underlying health is good, and we will remain being the partner of choice based on the order books that we see for the XPS devices globally for for all the customers who wants to set up an EVP program in 2025. Abdominal. Net sales q one came in at 57,000,000, and the organic growth was 28%, very much in line with the the rolling 12 growth that we see on on on 31%. So I would say it’s, yeah, a business of you business as usual quarter, but in a positive way because we continue to grow in Europe on our main market. Liver stood for 75% of abdominal sales and kidney, 25.

Liver sales grew 25% in local currencies, and kidney sales grew 51%. So here we start to see now some some some growth on in both in The US, but also in Europe on the kidney’s transport, although still from from small numbers. We know that, but we’re getting there. As an example, in The US, the disposable sales of Kinesis transport grew 108%. We doubled the sales there.

Gross margin disposables decreased from 68% last year to 63. I think we need to live with some fluctuations here on abdominal in the next, you know, one, two years until we get some economics of scale. But the primary reason this year was a higher portion of distribution sales and and some higher research sales from last year with higher margins. But but a solid quarter for abdominal in my opinion. Last business area, moving over to services.

Sales amounted to 20,000,000 organically. Sales from organ recovery decreased by 19% due to a lower activity volume, while the acquisition of FlowHawk contributed positively with an acquired growth of 13%. So all in all, negative 6% decrease versus last year. On a positive note, we signed a new recovery service agreements with three clinics in q one, and we look forward to start receive serving these clinics here in q two. Gross margin increased 38% versus 36.

This margin is expected to to strengthen gradually as the recovery volumes increased, but but most notably when sales of FlowHawk increased, which is a SaaS product with marginals with margins similar to a lung portfolio, actually, if not even better. In q one, we had integration costs here, and we continue to build this offering right and and integrate. So we had integration costs of 3,000,000 SEK as we continue to further build and integrate Flowhawk into the service offering. In order to further develop and define our service offering, a strategic review, as Christophe mentioned, will take place here in in the next few months. A project we have also started to work on is to look at how Flowhawk could be connected also with our various perfusion devices over time here in the future.

Two more slides before I’ll hand over to Christopher again. EBITDA profitability. EBITDA came in at 21 in q one, a 1% unit better than last year. And at rolling twelve months, we’re at 22%. Yeah.

Something like a broker record, but we’ve stated before, our ambition is to continue improve EBITDA year on year, but we want to do that in a controlled way so we maintain a healthy relationship between sales growth and a sustainable profitability development. As I stated in my in as I stated in my introduction here, q one was not negatively impacted by the weakened US dollar against SEK in the p and l. Most likely, we will see a fairly large impact in our numbers during the rest of the year, though. And to provide some guidance, we could look in the past. Right?

So if we look at last year’s numbers, in terms of sales, approximately 60% of our sales were in US dollars, and we have most of our COGS in euros and SEK. And if the USD against the SEK in 2024 was 10.5, roughly, a decrease to 9.5 as we see now in 2024 would have led to a decrease in SEK net sales last year of 45,000,000 SEK. And that in turn would result in a decrease of EBITDA of approximately SEK 20,000,000 or 1% unit on the EBITDA margin last year. So I hope that provides some guidance here on what we can expect for the future. Final slide, cash flow and financial position.

Q one operating cash flow was minus 15,000,000 SEK. No concerns there on my side, primarily due to a payment of our annual employee bonuses for 2024. If we wouldn’t have that, we would have been positive on the operating cash flow. We continue to invest. Investments amounted to 59,000,000 SEK.

As always, that’s primarily spent on The US clinical trials, but also the production project, BILI. We ended the year with a solid cash position of 316,000,000 after exchange rate effects on cash of SEK 22,000,000. And finally, as we announced in the last call, we have entered into a revolving credit facility of €20,000,000 here in January, which currently remains unutilized. And with that, I will give the word over to you again, Christopher, for the outlook. Thank you.

Christopher Rosenblatt, CEO, XVIVO: Thank you so much. Yes, we will look into, as usual, first what to expect during the year. And I think the the first thing is that we see a very high interest on starting an XDIVO ULP program, and we will invest to capture that one both in terms of headcounts and possible perfusion in services. We have stated that we have a scarcity of XPS machines right now, and we do see that we have more XPS machine in the second half of year than the first. So we will come back when we see that production picking up.

For heart, we will continue to prepare for the launch in Europe and Australia. We will continue to build The US regulatory and clinical file for heart. For liver, the excellent clinical data published, we will invest in commercial capabilities in Europe to capture the growth opportunity we see here. And we aim to start our clinical PMA trial during q three this year. So those are the milestones from regulatory viewpoint.

Lastly, I also want to stress that we see great investment potential during 2025 with a return on investment of approximately one year, and we will invest into those opportunities. Key commercial investments are the EU Heart launch, strengthening The kidney US launch, strengthening The US lung business as well as the abdominal launch in Canada. We will continue to invest in supply chain and quality department, regulatory department to capture the increasing customer demand for our products. And I also want to stress that we are building up our inventory levers. We have taken a revolver credit to do that, so we will see increasing, inventory lever during this year.

That is a planned action we do for making sure that we can always delivering products to the customers. And if we look into the little bit longer term outlook, which is the important one and and the reason why we were here, We see that the demand for transplant is still 10 times higher than the supply according to WHO. The sales value of machine perfusion is approximately times 10 versus static cold perfusion, which is typically a beer cooler type of box with ice and the solution. Machine perfusion and our service model have proven to increase the number of organs to be used for transplantation, especially in the fast growing DCD organ pool. The main growth drivers are superior clinical results from machine perfusion and the fact that service model reduce complexity and time for the TrePLAN clinic.

Hence, machine perfusion and service model on normal and DCD grafts will continue to drive growth in the near future and long future. Exviva has a unique and proven product platform to one day accomplish that no one will die waiting for an organ. And with that, I turn to the next page, four. Thank you for listening today. And with that, we open up the lines for questions.

Conference Moderator: The next question comes from Ulrich Trotter from Carnegie. Please go ahead.

Ulrich Trotter, Analyst, Carnegie: Thank you very much. Hi, Christopher. And a few questions on my end. Starting off with this Canada opportunity that have emerged and you already at States have long on the market in Canada. But now expanding that into the cat product as well as for the liver product.

And just if you can give us kind of a scope of how many sort of addressable organs there are and how the dynamic looks like? And are you facing the same type of competition in Canada as you do in The U. S, I. E. That TransMedics is the leading product provider for liver and more legacy products for kidney?

As well as the follow-up question to that is, do they experience the same type of limitation on the cat product in Canada in terms of the dual oxygenation ducts to the arteries as well as being larger kidneys that needs to be tweaked in terms of the consumable? That would be my first question.

Christopher Rosenblatt, CEO, XVIVO: Okay. Thank you, Rick. To start off with your first part of the question, Canada is size in terms of market opportunity compared to a big European market like France, etcetera. So it’s definitely a core market for us. Canada is also could also act as a bridge into United States due to close relationship between surges between Canada and The US across the border.

So that’s why it’s important. The market dynamics is more similar to Europe than The United States in terms of competition, and and and need. In terms of the the kidney product, we we have to see how some some of the needs are similar, like the dual or or triple artery patch holder. That that is, will be the same in The US and Canada. So but but the system with a clinician going out recovering is more similar to Europe than than The United States where the majority is pumped in opioids.

So it’s a it will be a mix of US and Canada, and we hope we can learn a lot from Canada both in terms of of meeting key opinion leaders, learning from them, learning more, getting acquiring more clinical data that will be not totally applicable to The US, but still reasonably applicable. What was the second part of your question? I forgot that when I answered the first part.

Ulrich Trotter, Analyst, Carnegie: I think you answered most of it. It was just more on how big of the market is as well, yes, similarities to that of The U. S. I think you answered all of it. But and sort of a follow-up question on that would be, what is sort of the planned ramp up here?

I did note that you mentioned that you have hired your first sort of rep into that market. How should we view the sort of step up here throughout 2025?

Christopher Rosenblatt, CEO, XVIVO: Sorry, your line is a bit broken. Can you try to repeat?

Christopher Nordstrom, CFO, XVIVO: We have hired

Ulrich Trotter, Analyst, Carnegie: our

Philipp Weiberg, Analyst, Pareto Securities: We’ll start.

Christopher Nordstrom, CFO, XVIVO: Yeah. First employee, Christopher. So how do you plan to expand the organization timeline for that in Canada?

Christopher Rosenblatt, CEO, XVIVO: Okay. Great. Yeah. We we have hired our first employee, and we will in the beginning, we will support from the US abdominal team. And we will come back somewhere during q four with a ramp up plan depending on on how it’s going.

But it’s geographically, it’s a big market, absolutely. But in number of clinics, it’s it’s it’s smaller, so to say. So, we we are we don’t foresee having a huge sales force in Canada, if that answers the question.

Ulrich Trotter, Analyst, Carnegie: Okay. Yeah. Sure. And if we were if we were to stick to to the cat prod product and and sort of tweaking and updating of the product as well as acquiring clinical data, it sounds like for your statement that we should expect that to be resolved closer to into 2026 rather than end of this year, which sounds like a bit of a delay from previous statement. Is that a fair assumption?

Christopher Rosenblatt, CEO, XVIVO: Yes, that is a fair assumption. Part of it will be solved during the year when it comes to to dual patch holders insights. The larger reservoir will probably go into ’26. Clinical data will be acquired gradually through this year and next year. But as we know, it takes time to get a clinical data and also publish it so that that we probably have to think more four to six quarters, than anything else before we can go full head into the OPOs.

Ulrich Trotter, Analyst, Carnegie: Yes. Great. As well as you mentioned, and I’m not sure if I got this right, that you’re expanding your service offering similar to that of Italy from Q2. If you could just remind me what you said and potentially clarify on how that is planned to be expanded throughout 2025?

Christopher Rosenblatt, CEO, XVIVO: Yes. We will trial it during Q2. We have always believed, but not being very successful so far in the Italian model in The U. S. So we will now spearhead a project in one to three locations depending on how long time it takes to get through in the hospital administration where we pair an EBILP service with the perfusionist.

We know that the need I would say that probably the biggest hurdle for EVP growth now is resources. That’s my judgment. And this would be one way of reducing that hurdle and getting more of your piece done in The United States.

Ulrich Trotter, Analyst, Carnegie: Great. And one sort of broader question related to NRP. And we’re seeing I guess, we’re all seeing the same type of publications coming out and news that NRP is gradually gaining traction, mainly in heart and liver. But can you remind us how it fits into your product portfolio? And correct me if I’m wrong, my understanding is that it’s mainly used as a complementary method to to your product portfolio.

Christopher Rosenblatt, CEO, XVIVO: Yeah. Yeah. That is correct. I mean, to to start with, we we are are really we we welcome NRP. It’s an it’s an additional to the to the transplant world, and it adds more organs from the DCD donor pool.

It’s also very complementary to our product portfolio. If you look at it’s it’s obvious for heart, liver, and and kidney where the kidney and and heart are transported, so you would still need to transport them after NRP. And the liver is back to base where you do, let’s say, you you pump the organ before transplantation to re oxygenate the organ. So if you do NRP or not, it doesn’t change the equation, so to say, if it’s not a very short transport. For lungs and EVLP, it is the WATS guidelines is that when you do abdominal NRP, which is the liver mainly and or and or kidney, then there is no problem taking the lungs because there there would be no damage done to the lungs.

When you perform a t r TANRP, which is a a thoracic, abdominal NRP, and you include the lung and the heart, you do it for the purpose of evaluating and recovering the heart. The risk is that you damage the lungs. So we see that EVLP is actually a tool to increase the number of lungs taken care of after TENRP, where you do today, you do it for the heart, and you very often have to discard the lung because of insecurity when you perfuse the lung on on too high pressure. So the the WA test guideline is that you should be careful using lungs from TANRP, but we believe that with EVLP, you can use those lungs as well. So that’s why we view it as a great complement to both the transplant world and to our product portfolio.

Ulrich Trotter, Analyst, Carnegie: Great. Thank you. Two more short questions. Bart Australia Q1 sales looks to be really strong momentum. I remember it must have been one, two years ago when we had a similar situation in Australia and that follow-up by a few weaker quarter where there was some inventory buildup.

Is this the case now? Or is there something different?

Christopher Rosenblatt, CEO, XVIVO: We see higher penetration this quarter versus last year, full year. We it could could always be quarter by quarter, let’s say, stocking, destocking because there there are few clinics. And if they have one, two or three kids on the shelf, will affect our growth rate. So I think we should look when we look at growth, we should rather look at twelve months rolling. It’s just very encouraging to see that there is a

Johan Unnurys, Analyst, Redeye: high

Christopher Rosenblatt, CEO, XVIVO: interest. It is an increasing penetration, and we do see that we need better proof on DCD hearts, both with or without NRP. I mean, you can do TNRP, which was included in our heart trial. You can do direct procurement, which we’re now trialing in Europe on 40 patients in Benelux. And we will we will also trial in in Australia soon.

We are right now conducting preclinical trials on on DCDRs in Australia. So we do see to to really get the usage up, we have to be able to use both DVD and DCD in Australia, Europe and United States.

Ulrich Trotter, Analyst, Carnegie: Great. And last question, and it’s a short one for Nordstrom. Net financials, minus SEK 41,000,000 in Q1. What’s the explanation behind this?

Christopher Nordstrom, CFO, XVIVO: It’s that’s nonoperational. So it’s primarily the the weakened US dollar and the effect on not only cash, but also our, you know, other other balance items.

Ulrich Trotter, Analyst, Carnegie: Okay. So mainly sort of revaluation of receivables.

Christopher Nordstrom, CFO, XVIVO: Yeah. And and since the biggest kind of well, we don’t know, of course, but I think we had a we had a big hit in q one because there was a big devaluation of the US dollar. And if that stabilizes, I think that effect should be less on on the financial item side in in the next quarters. But that’s who am I to judge?

Ulrich Trotter, Analyst, Carnegie: Okay. Great. That was all the questions on my end, and I’ll get back into the queue. Thank you.

Christopher Rosenblatt, CEO, XVIVO: Thank you.

Conference Moderator: The next question comes from Philipp Weiberg from Pareto Securities.

Philipp Weiberg, Analyst, Pareto Securities: I’ve got a couple of questions here on the XPS. So you delivered four new XPSs now in the end of the quarter. So I was just wondering if you could give some more details around the type of customers those are like high volume, low volume? What should you say about them?

Christopher Rosenblatt, CEO, XVIVO: Thank you, Filip. Very good question. We are definitely excited. There are high volume customers. They are the ones that show integrated in interest of starting an EVP program.

You need a you need to do a certain amount of of lungs per year in order to sustain an EVP program. And one of them is a very reputable type top 10 customer in The United States that was included this quarter.

Philipp Weiberg, Analyst, Pareto Securities: Okay. Okay. Good to hear. And I guess they are up and running like immediate or is it any delay before they are I guess they have to ramp up utilization, but is it how long time does it take?

Christopher Rosenblatt, CEO, XVIVO: Yeah. That that’s a great question. This is something we’re working on. It it takes too long time today, and we we are working on shortening that time frame. The so once you deliver an XPS, you then have a training, and then you have a couple of cases trial runs, and and and then you go live.

We have seen historically that from somebody sends a PO until the up and running, it could be six to nine months. But we are working actively to reduce that time to two to three months. But but today, it is unfortunately, it takes some time. Sometimes very practical reasons that you need a a training lung, you don’t know when there is a discarded human training lung that you can actually perform a training on. But we are running a project to reduce this, let’s say, startup time, dramatically from where it is today to to where it should be in the future.

Philipp Weiberg, Analyst, Pareto Securities: Okay. Thanks. Very clear. So gradual ramp up takes takes some time, but it’s going to increase right away after they have done this trial on them.

Christopher Rosenblatt, CEO, XVIVO: Yeah. So so typically, they are once they are fully trained, fully certified, then then they ramp up pretty pretty quickly, but it it takes too long time to get them fully trained until ramp up today.

Philipp Weiberg, Analyst, Pareto Securities: Yes. Okay. And the other one on the XPS here is around the production. I was just wondering if this is is there any new problem here around the production constraint on the XPS machine? Or is it have you had the same production capacity for long and it’s just that the demand has increased now?

Like how do you explain this?

Christopher Rosenblatt, CEO, XVIVO: Yes. It’s a combination. What happened was that last year, we had a couple of obsolete products in the XPS that we needed to change. That change took longer than we expected to get the both get the right products in and and get it approved so we could sell the XPS again. That one is that work is now finalized, and we are are slowly wrapping up.

The other thing that happened is that there is a higher interest than we expected. So those those two in combination is is not great, of course, when you have a six months nondelivery and then a greater interest than we ever seen before. So it’s a combination of the two.

Philipp Weiberg, Analyst, Pareto Securities: Okay. But it also sounds like you’re talking about how much you’re going to produce for the remainder of the year, but you sound highly confident that you’re going to be able to sell all of those. Is that a correct assumption

Conference Moderator: or

Christopher Rosenblatt, CEO, XVIVO: That is correct.

Johan Unnurys, Analyst, Redeye: Well, that

Conference Moderator: The next question comes from Maria Vara from Bayern, Garnier and Company. Please go ahead.

Maria Vara, Analyst, Bayern, Garnier and Company: Good afternoon. Thank you for taking my questions. I was wanted to first follow-up on the previous questions on the time that it takes to train the proficient as I’m using the machine, but more in relation to the hard technology. If I recall from your report, you said that all of them basically initial interest are well trained. But I was wondering how long it takes to actually get trained for heart technology.

Is it similar to to the lung technology? And how you foresee any other educational programs ahead of the launch in Europe?

Christopher Rosenblatt, CEO, XVIVO: That’s actually a great question. We we have seen that the the heart is a lot easier. So again and again, we’ve seen that a clinic can is can be up and running very fast. We’re talking about one to three months for the heart technology, and they are more or less fully sufficient using the heart technology after running only three, let’s say, real cases. So there is a learning curve for heart, but it’s very, very steep compared to the learning curve for lung, which is evaluating a lung is a little bit more complicated than than just perfusing a heart, so to say.

So we don’t foresee the same problem, but we have to be very humble for the fact that there is a training period needed for the heart, and we know that they need to do three real cases before they’re fully up and running. In Europe, we have 15 centers who are already up and running, So we don’t foresee a a great training phase here in Europe. But that is because we did we run the trial before.

Maria Vara, Analyst, Bayern, Garnier and Company: Okay. That’s that’s very helpful. And then I wanted to get a bit of color on the liver trial. It’s great news that you get the approval to start enrollment. I was wondering if you could share some details on the expected time for enrollment considering you’re going to enroll about 200 patients, if we could consider a similar rate of enrollment compared to The U.

S. Trial to get a sense a bit of when will the enrollment will be finalized and then potential approval more towards 2028 or a bit earlier?

Christopher Rosenblatt, CEO, XVIVO: Thank you. Yeah. We if you have similar enrollment rate as in the heart trial, it will since it’s more patients, it will take somewhere between twenty four to twenty six months. And that is also what we’re aiming. I would like to come back when we seen, let’s say, the few centers in to talk to test that if we see a faster enrollment or or slower.

We know the interest is very high, so we hope for for a little bit faster. But if we do a one to one comparison, it’s a rather twenty four months, let’s say, timeline we’re looking to than than anything else.

Maria Vara, Analyst, Bayern, Garnier and Company: Okay. That’s helpful. And in terms of sales that we could expect from The US trial and deliver, is it gonna be charged or at least you aim to charge a similar price to The US heart trial?

Christopher Rosenblatt, CEO, XVIVO: It will be similar, but slightly lower was the last I I heard. So we we’re still in negotiations. We don’t know the final price. It will be slightly lower if I’m still correct from from the last correspondence with CMS.

Maria Vara, Analyst, Bayern, Garnier and Company: Alright. And then maybe a last question. It’s great news that you got the continued access protocol for heart. However, I was wondering if this six months allowance for up to 60 patients means that you will only be able to do it for the upcoming six months and then discontinued access protocol will stop or does it mean that it reinitiate again meaning that could continue with the protocol until you get approval?

Christopher Rosenblatt, CEO, XVIVO: The the the correspondence we got from the FDA was that we it will be renewed based on on safety data. So they they will have a quick review next time and look at the safety data to renew it until approval. That’s the last thing we heard from the FDA.

Conference Moderator: The next question comes from Johan Unnurys from Redeye.

Johan Unnurys, Analyst, Redeye: Some of them have actually been answered already. Yes, to go back to some impact on tariffs, just a clarification. It seems to be rather modest impact on your part. You operate with high margins, especially on the consumable side, and you operate through U. S.

Subsidiary, and presumably, the tariffs will be based on price level closer to COGS. And also historically, you have also been in a very good position to be able to review your prices and your prices are still relatively modest compared to some of the competition. Is that a fair picture?

Christopher Rosenblatt, CEO, XVIVO: Yes. No, that is a fair picture. So we are lower compared to competition. We have also unique products, which are, in in many cases, a fraction of the total cost of transplant for per organ. So we we believe that there will be an ability to to recover the the tariffs by price increases for for for those products.

That being said, where we’re running a trial and and there is a CMS set reimbursement or cost recovery, we can’t change the prices because it’s set by the CMS. So for example, the heart trial, we can’t change prices, or the future cost recovery for for liver will be fixed prices. So so to be clear, there there we can. But that’s a limited number of patients and limited, let’s say, amount. And we don’t foresee that, that will be have a huge impact on our profitability.

Johan Unnurys, Analyst, Redeye: Thank you. That’s useful. And also the Express has been explained. You had some review of earlier products together with higher demand than expected, and it will take some time for you to match the demand level, which is structurally positive, of course. And what about on the lung side, on the supply?

There have been some glitches on that side as well. But what can we expect? When will you be fully operational? Or this is a small thing?

Christopher Rosenblatt, CEO, XVIVO: No. We believe that in terms of Expresses, we will be hopefully fully up and running and meet customer demand in Q4. We are certainly working very hard towards that. So we will do our utmost. Regarding the the the disposables, we don’t foresee any any shortages there.

We have enough production capacity for for the the next two years. Over time, we will increase production capacity of disposables for lungs. But for the next two years, we believe we can meet the map.

Johan Unnurys, Analyst, Redeye: Thank you. That’s also useful. And also regarding the continuous well, the compassionate use or continuous protocol, You’ve got the clearance, the first patients expected by during this quarter, you will be able to sort of activate some of these sick patients during the first six month period and then they will follow then the safety review and then another six month. But what this is, of course, very important and interesting in terms of gaining clinical experience and activate continue to activate clinics and centers, but limited impact on sales. But what can we how long will it take to activate all six?

And if this is that number, even if you extend additional six month period?

Christopher Rosenblatt, CEO, XVIVO: Yes. That is a great question. I think in the beginning, we will go very try to be very sharp and talk to the ones who believe that they can’t live without the heart box. We have a few clinics in The US who said now during the down period that they have patient dying on the waiting list because they don’t have access to the heart box. And, we will target those first because there is still this is viewed as a new clinical trial from each hospital site.

So we have to renew IRB, and we have to renew the contract. So, of course, they look exactly the same as the old one. I still have to go through an RV and and a clinical trial in the in the hospital clinical trial process in the hospital. So it is a bit of administrative work. So we will target a few clinics in the beginning and then reset and see how much resources we have and if and or if we should target all of them or not.

That decision has not been taken yet.

Johan Unnurys, Analyst, Redeye: That’s also useful. And that touches on the services side. This is, of course, under review, and it’s sort of a mix where the current setup is more tailored towards hard, but which will be, of course, in use also during this clinical protocol stage. It’s too early to say any specific about these services, but of course, it’s a critical operation and it’s important that you have the support of this. But it’s also an issue of what sort of sales resources.

Should we review your services business as more of a supporting business in in this stage?

Christopher Rosenblatt, CEO, XVIVO: Yes. We heard from many heart transplant clinics that they say you have a fantastic product, but you need to pair it with a good organ recovery service business to capture all all heart transplants in The US. So there is a bit of of of work to be done there for sure. So it is very strategically important for heart. So what we hope hope to do is to get the ability of during the continuous access protocol, to get the ability to for our audio recovery service to train on on the heart box, together with clinics.

So we are fully up and running when we launch the heart. So that is part of the strategic review we are doing now together with third party to to make sure that we are ready when when we have approval of heart in in The United States.

Johan Unnurys, Analyst, Redeye: And what about benefiting from the services side on the lung business? Is that more of a challenge?

Christopher Rosenblatt, CEO, XVIVO: It is more of a challenge. The current organ recovery service we have is not 100% tailored towards the lung business. We we need more of the Italian model, which is we have shown great progress on on Libre, for example. And that model works very well. So we need to we need to have a a a two two phased approach here.

First, we have to make sure that we have an audio recovery service that will be second to none in when we launch heart. And secondly, we need to have a perfusionist slash organ recovery service for lung. The so we have have we can build that audio recovery service until heart loss, so to say. So we don’t have to start that work. As as long as the the only thorax product we have approved in The US, that would be perfect to have a have a have a great service around the two of them.

So we do see that we need to add more perfusionist to our service offering to be relevant in lung, which we do acknowledge. We we not fully relevant right now. We have surgeons out there who who recover hearts or lungs, and they very often recover hearts, they see those are really good lungs. So they if they would have a a place to send those lungs, that would be, with the perfusionist, that would be great to the so we use more lungs from the donor pool.

Johan Unnurys, Analyst, Redeye: Interesting. And presumably with the dynamics on the NRP side that that need may even increase?

Christopher Rosenblatt, CEO, XVIVO: Yes. We believe so. That if we could have access to a perfusionist close to an NRP site, so we could send the lungs directly to to UBLP. This is what they do in France. They have a special protocol where they actually take the lung and then then then they can do TINRP, without damaging the lung, with very good success rates.

So that’s something that that would be very good. But then we also need to pair our service offering with an NRP service. So that would be part of our review as well.

Johan Unnurys, Analyst, Redeye: Yeah. And this will take some time to both decide and implement, of course.

Christopher Rosenblatt, CEO, XVIVO: True. I mean, when once we implement, we will act swiftly, but we first have to make sure that we do our homework.

Conference Moderator: The next question comes from Jakob Lemke from SEB. Please go ahead.

Jakob Lemke, Analyst, SEB: Thank you. I know we’re probably running over time, but I’ll shoot in a quick question. On liver, it’s a bit of a better quarter than recently. And I know that or at least it seems like Italy, which is a key market for you in liver, in general, had sort of slower growth for liver last year.

Maria Vara, Analyst, Bayern, Garnier and Company: And

Ulrich Trotter, Analyst, Carnegie: just given

Jakob Lemke, Analyst, SEB: what you see now, do you see Italy improving? And just in general, the outlook for liver in Europe for 2025?

Christopher Rosenblatt, CEO, XVIVO: That’s a great question. Liver is one of those organs where we have all prerequisites to to become gold standards over time, especially in Europe because the all the clinical data shows that it’s it’s good for the liver. It’s good for the patient. It’s, also saves money to the hospital because you have, less aftercare. So, and lastly, they can actually start to plan, surgery.

What we have in Italy is that perfusionist model where we support them with pumping the organ as well. So we don’t put a restraint on the hospitals by having liver. So we definitely see that that model we need to spread into the rest of Europe. We see actually growth in more countries than Italy. So we see Italy is definitely back to a higher growth rate compared to last year.

But we have to look at it more again, twelve months rolling, looking forward twelve months. Quarter by quarter, it could be jumpy, but we do foresee a pretty good growth in liver due to the good clinical results. But also, we are nearing that phase in liver where it becomes almost like a general practice to have a have a liver device. Now we are between 14% to 25% market penetration country by country in Europe. And that is typically there, we go from being an investigational device to a market practice.

So we do see that we have all the prerequisites for growth. Now I think it’s up to that we have a large enough sales force to actually capture that growth.

Jakob Lemke, Analyst, SEB: Okay. That sounds very promising. And just shortly did I interpret it correctly that you have gotten confirmation that you can get reimbursed for the cases in the liver trial?

Christopher Rosenblatt, CEO, XVIVO: Then we have not confirmations. We are in negotiation with the CMS regarding cost recovery in The U. S. Trial, if that’s what you referred to. We have not yet got confirmed.

Jakob Lemke, Analyst, SEB: Okay. That’s all for me. Thank you very much.

Christopher Rosenblatt, CEO, XVIVO: Thank you. I think we are almost fifty minutes over time. So with that, it concludes the meeting. And I hope to meet all of you on July 11 when we’ll report the q two results. Thank you very much, and see you next time.

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