Good day, ladies and gentlemen. Thank you for standing by. And welcome to the Cerus Corporation First Quarter 2022 Earnings Conference Call. At this time all participants are in listen-only mode. After the speakers’ presentation, there will be a question-and-answer session. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker host today, Mr. Matt Notarianni, Senior Director of Investor Relations. Mr. Notarianni, you may begin.

Thank you, and good afternoon. I'd like to thank everyone for joining us today. As part of today's webcast, we are simultaneously displaying slides that you can follow. You can access the slides from the Investor Relations website at ir.cerus.com. With me on the call are Obi Greenman, Cerus' President and Chief Executive Officer; Kevin Green, Cerus' Chief Financial Officer; Vivek Jayaraman, Cerus' Chief Operating Officer; Carol Moore, Cerus' Senior Vice President of Regulatory Affairs and Quality; and Jessica Hanover, Cerus' Vice President of Corporate Affairs. Cerus issued a press release today announcing our financial results for the first quarter ended March 31, 2022 and describing the Company's recent business highlights. You can access a copy of this announcement on the Company website at www.cerus.com. I'd like to remind you that some of the statements we will make on this call relate to future events and performance rather than historical facts and are forward-looking statements. Examples of forward-looking statements include those related to our future financial and operating results, including our 2022 product revenue guidance and goals, operating expenses, anticipated cash use from operations, gross profits and gross margins, as well as commercial development efforts, future growth and growth strategy, future product sales, product launches, ongoing and future clinical trials, ongoing and future product development and our regulatory initiatives, including the timing of these events and activities. These forward-looking statements involve risks and uncertainties that can cause actual events, performance, and results to differ materially. They are identified and described in today's press release and under Risk Factors in our Form 10-K for the year ended December 31, 2021, and our Form 10-Q for the quarter ended March 31, 2022 which we will file shortly. We undertake no duty or obligation to update our forward-looking statements. On today's call, we will begin with some opening remarks from Obi, followed by Vivek to discuss some recent business highlights and Kevin to review our financial results. We will conclude with commentary from Obi with an update on our pipeline and closing remarks. On today's call, we will also be discussing non-GAAP financial measures, including non-GAAP adjusted EBITDA. These non-GAAP measures should be considered a supplement to and not a replacement for measures presented in accordance with GAAP. For a reconciliation of non-GAAP financial measures to comparable GAAP financial measures, please refer to today's press release. And now it's my pleasure to introduce Obi Greenman, Cerus’ President and Chief Executive Officer.

Thank you, Matt. And good afternoon, everyone. Our first quarter of 2022 continued the momentum we have seen over the past few years as INTERCEPT adoption, particularly in the U.S., is ramping. Our work is focused on establishing a new safety standard in transfusion medicine so blood centers and transfusion services can protect patients and ensure availability of blood components. In the context of the current pandemic and the prospect for future risk to the blood supply, the Cerus mission is as relevant as it has ever been throughout the company's history. I am pleased that growing our top line means expanding access to INTERCEPT treated platelets and plasma for patients around the world. After I discuss our quarterly results, Vivek will spend some time today discussing recent significant announcements associated with long-term contract extensions with both the American Red Cross and Fresenius Kabi. But first, let's review the first quarter revenue highlights. Product revenues for the first quarter of 2022 are the highest for any first quarter in our history, as we report year-over-year growth in all major geographic regions to start 2022. With our 20th consecutive quarter of year-over-year revenue growth, we are demonstrating an enduring ability to expand access to INTERCEPT treated blood components, even in the face of geopolitical and economic uncertainty. Our results were once again led by strong growth for platelets in the U.S., which was up over 130% on a year-over-year basis. Blood centers and hospitals are choosing the INTERCEPT blood system for platelets as a means to comply with the FDA bacterial safety guidance because it provides proactive broad-spectrum protection against pathogens beyond just bacteria, while also offsetting costs and generating operational benefits. As we look to diversify the ongoing growth of the INTERCEPT platelet business in the U.S. and globally, we are making solid progress with our nationwide launch of INTERCEPT Fibrinogen Complex, or IFC, across the U.S. We have a robust funnel of accounts we look forward to bringing online through 2022 and into 2023. We are just beginning to realize the leverage of our combined direct-to-hospital and blood center sales channels. As we know well from our prior product launches, bringing a new product into hospital transfusion services and changing clinical practice is a significant undertaking, but we are benefiting from the strong clinical interest around the opportunity to improve the patient treatment paradigm through early administration of a Fibrinogen enriched product without delay, while also reducing frequent conventional blood product wastage. Hospitals that have adopted IFC are quickly seeing numerous benefits compared to conventional cryoprecipitate. Perhaps the most compelling example is at the University of Florida Shands Hospital where IFC has now been included in the first round of the institution's massive transfusion protocol, and wasted rates have been reduced from over 20% to less than 0.5%. With an estimated demand for Fibrinogen expected to grow in the mid-teens over the next five years, we are excited to be rolling out IFC across the country at a time when the awareness around early Fibrinogen delivery is growing, both as a function of improved coagulation monitoring and lower transfusion thresholds. I would now like to hand the call over to Vivek to provide some updates about two of our partners, the American Red Cross and Fresenius Kabi.

Thank you, Obi. And good afternoon. It is great to be able to share these results with you all today. In addition to the strong start of the year, I want to spend a few moments talking about a couple of recent developments that position us well for the long-term, both commercially and operationally. First, last week, we made an exciting announcement regarding our relationship with the American Red Cross. We are honored to have announced a five-year contract extension for INTERCEPT platelets with the American Red Cross. As you know, the Red Cross is responsible for supplying the U.S. with about 40% of its blood products. Their leadership in areas of transfusion medicine, like blood safety, serves as a model for other blood centers and national transfusion services globally. Because of Red Cross' focus on patient safety and timely compliance with the FDA guidance on platelet bacterial risk mitigation, Red Cross has become the largest producer of INTERCEPT components and is now our largest customer. The INTERCEPT Blood System for Platelets is in routine use at each of the Red Cross' 22 platelet production sites across the U.S. This contract extension will help them realize their stated goal to transition towards a full pathogen reduced platelet supply and represents yet another validation of the INTERCEPT blood system and its ability to improve platelet availability, while affording operational benefits when standardizing with an INTERCEPT treated platelet inventory. Moving on to another recent announcement, we have also assigned a 10-year contract extension with Fresenius Kabi for the production of INTERCEPT kits. We are very excited about this agreement as well. The Fresenius Kabi team has been a key partner to Cerus for more than 20 years. With this new agreement, we are able to ensure that additional capacity, as well as redundancy in our manufacturing facilities are in place for the next decade. In anticipation of ever-increasing production volume, this agreement will allow us to both utilize additional economies of scale and also improve the cost profile for the INTERCEPT kit portfolio. On a related note, our manufacturing capacity efforts that we highlighted in our last quarterly call continue to track the plan. We look forward to completing the rest of this work, including obtaining the necessary regulatory approvals, which will help bring this capacity online. I will now turn it over to Kevin to discuss our results in more detail.

Thanks, Obi, and good afternoon, everyone. I’m pleased to provide the following update to you all today, recapping our first quarter and also spending some time discussing our non-GAAP adjusted EBITDA measure, which we are reporting alongside our GAAP results today. Our first quarter 2022 product revenue is up $37.4 million, reflecting year-over-year growth of 60%, and importantly, all of our major regions North America, EMEA and rest of world posted positive growth during the quarter. As anticipated, the growth in sales we saw in North America continues to lead the way, up 130% versus the prior year period. As of that context, our first quarter revenue in North America, up $22.2 million, is nearly as large as our total global product revenue was during the first quarter of 2021. Within North America, our sales to the top five U.S. blood centers and the sales to the group of blood centers outside of the top five grew by more than 100% year-over-year. Turning to EMEA, the region returned to strong growth in the first quarter of 2022, up 11% year-over-year and up 19% excluding the negative impact of foreign currency. Growth in the region was broad-based during the quarter, despite the turmoil that has been capturing headlines in Eastern Europe, in particular. Moving on to our calculated platelet dose metrics, our first quarter growth in the calculated number of treatable platelet doses reflects a 141% year-over-year increase in the U.S. and a 28% increase internationally. In terms of product mix for the quarter, sales of INTERCEPT disposable kits represented nearly 98% of our Q1 product revenue. In addition to our product revenue and not included in our guidance, government contract revenue totaled $5.6 million in Q1 versus $6.2 million for the prior year period. Turning now to our gross profit and gross margins. Our first quarter gross profit was $19.4 million, compared to $12.3 million during the prior year period, an increase of 58% year-over-year. The increase in gross profit was primarily driven by the higher product sales. Product gross margins for the quarter were 51.7%, which increased 60 basis points when compared to our Q4 2021 product gross margin. As we noted throughout 2021, our product gross margins were negatively impacted by higher sales volume of single-dose kits to U.S. customers, but had leveled out over the course of the year on a sequential basis. We expect to return to gross margin expansion on a full-year basis in 2022, as ongoing headwinds associated with elevated freight costs are expected to be offset by a more favorable product mix, as well as the beneficial COGS impact resulting from the recent decline in the Euro. Moving on, our first quarter operating expenses, which totaled $34.8 million, were fairly flat versus the prior year period and included $6.4 million in non-cash stock-based compensation. As you’ve heard me say over the years, we believe our business is structured to be able to generate significant operating leverage. I’m pleased that once again, we are demonstrating our financial discipline in real time. By specific expense type, first quarter research and development expense totaled $14.1 million, compared to $15.7 million during the prior year. As we’ve seen projects reach completion and the associated spend roll off, we continue to invest in new R&D projects in support of our pipeline, including the new LED-based illuminator. First quarter SG&A expense was $20.7 million, up 8% versus the prior year period. With our existing commercial infrastructure, we have strong conviction that we will continue to see operating leverage as our product sales grow. On the bottom line, reported net loss attributable to Cerus for the three months ended March 31, 2022, decreased when compared to the same period in 2021. Net loss attributable to Cerus for Q1 totaled $12.3 million or $0.07 per diluted share compared to $17.5 million or $0.10 per diluted share for the prior year period. I would now like to take a few moments to discuss our non-GAAP adjusted EBITDA measure, which we have broken out for you for the first time this quarter. You’ll recall this measure is intended to provide you with a view on how efficiently our commercial business is tracking to cash flow breakeven, which has been and continues to be a critical focus of the entire organization. As you can see on the current slide, we have prepared the calculation of this measure for the last five quarters. For the first quarter of 2022, our non-GAAP adjusted EBITDA was a negative $3.7 million, compared to a negative $11.5 million during the first quarter of 2021. To help everyone with historical modeling, we’ve provided the remaining quarterly reconciliations for 2021 and plan to continue to report this metric in future quarters as well. Over the last five quarters, we have seen a continued sequential improvement in our non-GAAP adjusted EBITDA. Turning to the balance sheet and cash flows, the first quarter of each year is typically our largest cash burn quarter due to a variety of seasonal items such as the payment of certain accrued liabilities. With that said, we ended the first quarter in a strong cash position with $108.6 million of cash and cash equivalents on the balance sheet. In terms of cash flows, cash used from operations was $21.5 million for the first quarter, compared to $17.5 million in the prior year period. Wrapping up my prepared remarks with one full quarter behind us and the continued strong demand in the market today, we are raising our 2022 product revenue guidance range from $157 million to $164 million to a new range of $160 million to $165 million, which now reflects year-over-year growth in a range of 22% to 26%. As we indicated on our fourth quarter call a few months ago, we continued to closely manage the strong global customer demand we are seeing against our existing manufacturing capacity and inventory on hand. Additionally, the recent change in foreign currency rates, in particular, the U.S. dollar to Euro, results in a modest pressure on our top line versus our expectations earlier this year but is also offset further down the P&L resulting in a neutral impact to the bottom line. Taken together, 2022 is shaping up to be another strong year of growth for Cerus, as we make solid progress on our key initiatives for the year, including facilitating further adoption of INTERCEPT in Europe and the U.S., increasing our manufacturing capacity to meet the growing demand, launching our IFC product nationwide, executing on our targeted R&D portfolio and moving toward our non-GAAP adjusted EBITDA breakeven goal. With that, let me turn the call back over to Obi to provide an update on our pipeline as well as a few closing comments.

Thank you, Kevin. Before we open up to questions, I wanted to touch on a few quick updates about our R&D pipeline that continues to make good progress to start 2022. First, in China, we continue to work with our joint venture partner ZBK to bring INTERCEPT platelets to the sizeable market. While the recent COVID-imposed lockdowns have continued to create challenges associated with regular meetings and other interactions in country, our teams have been working together virtually on the plan to submit INTERCEPT platelets to the Chinese regulatory authorities with a goal of making this filing by the end of 2022. As a reminder, the need for an additional in-country clinical study, beyond our previously completed Hong Kong study, will be determined by the NMPA regulators after our filing. Finally, with regard to INTERCEPT red cells, our European submission continues through the CE mark process as a Class III medical device, but the timeline has been impacted by bandwidth constraints by the Competent Authority CBG, which like all others across Europe have fallen behind schedule due to the MDD to MDR transition for medical devices. In the U.S., BARDA continues to fund and support our Phase 3 clinical studies, where we are seeing an uptick in enrollment as a function of the COVID impact waning a bit across the U.S. sites. That said, we still see some regional differences in hospital engagement, and there remains an effort across the country to minimize blood component transfusions as a function of the national blood availability crisis during the pandemic. In summary, the entire Cerus team continues to execute to make INTERCEPT available to more patients across the globe each day. We expect this to continue in the near-term with our current portfolio of INTERCEPT platelets, plasma, and IFC. Over the long-term, we are optimistic about the addition of INTERCEPT for red cells and continued geographic expansion to large markets like China. As we scale the business, I’m pleased with our progress towards cash flow breakeven, which will provide us with the flexibility to self-fund our growth initiatives and our strong R&D pipeline. We believe our currently approved INTERCEPT products and future iterations position Cerus as a leader in the field of transfusion medicine for many years to come. With that, let me turn it back over to the operator for Q&A.

Thank you, sir. Our first question comes from Brandon Folkes. Your line is open.

Thanks for taking my question. Just two for me to start, maybe Kevin, just a housekeeping one. Just want to see if I’m doing the math right. If I heard you correctly, the FX impact in the first quarter, was that roughly $1 million? That’s number one. And then you sort of touched on this, I was hoping to get a little bit more granularity. But in the new guidance, what’s in there for FX versus maybe how we started the year, clearly you’re absorbing it without performance. Just curious what the Delta is in the new guidance versus where we started. And then just one follow-up after that.

Yes, you’re – Matt, you’re right. FX for the quarter was about $1 million or roughly 4% year-over-year impact. On the bottom line, it’s almost a wash, given that we source most of our product in Euro or selling that to U.S. customers. So as we begin to sell products that we procured at lower FX rates, we’ll see some benefit from that as the U.S. continues to grow. As far as what’s in our guidance, I think we felt confident raising guidance both lower end and top end. But with that said, we do feel like there is some headwind potentially relative to Q1 and for sure, where we started the year. We had originally anticipated the year with roughly 1.15 rate and adjusted that down a bit. Who knows where it ends up, but we feel like we’ve factored that into the new guidance range.

Okay. Appreciate it. And then the follow-up maybe first for Vivek and maybe Kevin too to follow. But just a little bit more color on the Red Cross contract Vivek and how does that improve your visibility, your ability to forecast, and I guess, part your ability to serve the broader U.S. market. And then I’ll just layer in the question for Kevin. So how do we think about if at all the impact on the P&L from this? So I assume there are price volume tiers in there. I guess, the question really asking, should we be thinking about anything incremental that would somehow impact the top line or margins just given the size of Red Cross as a customer. Thanks.

Sure. Happy to. Thanks for the question, Matt. I think starting off just moralizing the contract extension with the American Red Cross is critically important. In large part because we – they had stated explicitly that they want to get to 100% PR; this puts the contractual relationship in place. I think it enables us from a demand management forecasting, operations planning standpoint to step into the next few years very confident that demand will be there and we can sort of prompt the manufacturing machinery accordingly. Both the ARC and the FK agreements really kind of go hand in glove. In terms of progress, visibility, forecasting, all of those have materially improved in large part, as they’ve brought all of their manufacturing centers online. An interesting thing to note, and I think that works well for us moving forward, we are starting to see some underlying market growth in the platelet marketplace and some increase in the ARC percentage of that market. Obviously that goes to PR; both of those factors accrue to our benefit. It’s still early days to be very definitive about that, but certainly the initial trends are encouraging. I’ll defer to Kevin for a discussion around potential P&L impact and margins. But I have to say, for us, just it increases our level of confidence and conviction as we step forward in terms of the ARC continuing to be a major growth driver for our overall business.

I don’t have a whole lot to add there. I think it certainly gives us confidence and coupled with the new manufacturing agreement with Fresenius Kabi to expand geographically and return to economies of scale, which admittedly in 2021, we didn’t benefit from. I think those two combined are fairly seminal contracts for the company.

All right. Thanks again, everybody. Congrats.

Our next question comes from Brandon Folkes with Cantor Fitzgerald. Your line is open.

Hi, thanks for taking my questions and congratulations on the quarter. So maybe just following on in the Red Cross contract, how should we think about that contract being memorialized then maybe driving others to follow the Red Cross’ lead there towards higher PR levels? Is there any precedent in terms of how we should think about how long that could take or how impactful that may be towards others?

Yes, thanks for the question, Brandon. I’ll take a shot at that and maybe Vivek will add some more perspective as well. Fundamentally, the American Red Cross is a leader in the field as it relates to blood safety policy, and things that the Red Cross does either operationally or for blood safety reasons carry over to other institutions, both in the U.S. and globally. What we’ve been able to accomplish with the Red Cross, thanks to their early advocacy for pathogen reduction, is to demonstrate the operational benefits of early release of products, and so a better shelf life combined with the fact that INTERCEPT platelets have a single SKU if you will in the sense that it, albeit it needs to do CMV testing or gamma irradiation. You have a single product code that can be moved around hospitals more efficiently. Vivek, do you have any other thoughts on that?

What I would add is that the leadership that the American Red Cross has shown even prior to the contract extension with respect to the open letter they wrote to the industry and their move towards ensuring that blood products are distributed and recognized for the value they deliver, as opposed to being viewed as commodities. All of those efforts are already impacting the market. Oftentimes hospital customers in the U.S. have multiple blood product suppliers, yet they want to standardize on a particular platform. So as their platelets from the Red Cross are pathogen reduced, that's creating a push on their other suppliers to harmonize across the pathogen reduced standard. We are starting to see that take place, and as Obi indicated, this is a multibillion-dollar industry, but it's really a cottage industry. There are a small number of customers, and they interact with each other as Congresses start to resume in-person activity, and even in a virtual setting the American Red Cross story in terms of their adoption of pathogen reduction and the benefits that provides not only them internally but also their hospital customers and their patients, that messaging is getting out there. Predicting the exact timing of how it influences others is not an exact science, but we're certainly seeing the impact and the influence they have, not just in the U.S., but globally in terms of blood safety.

Great. Thank you. I appreciate all the color from both you and congratulations again.

Your next question is from Josh Jennings with Cowen. Your line is open.

Hi, this is Eric on for Josh. Thanks for taking the question. Just thinking about the O-U.S. INTERCEPT Platelet business, excuse me. Are there any international adoption decisions that could go Cerus' way in the near to medium term? I appreciate the update on your China submission that's set for later this year. But could we get an update on any other potential international market opportunities that could materialize in the next 12 months or so?

Yes. Thanks a lot, Eric. I'll start and again I'll turn to Vivek for additional perspective. We just have completed the submission for Canada and are happy to see that deployment evolve quickly. We’re hoping to see some real progress later this year and into 2023. It’s always difficult to speculate on when some of these key markets might act, given that there’s oftentimes just a single transfusion service running the business in these countries. But there are several opportunities that are in play. Germany is always a key question given the size of that market. Vivek, do you have any additional thoughts?

If you look at Canada and the progress we've made there, we anticipate the impact to start showing up later this year and into 2023. Similarly, we've talked about Germany, which is the single largest market in Western Europe. We're seeing good customer interest there, which we believe should start to materialize in the next couple of years. Also, the one watch out is just where we are with the pandemic and avoidance of any major waves going forward. A lot of the initial groundwork in these key geographies has been done, so it's a matter of continuing to push forward. There are some other markets where we have tender activity ongoing, but speculating on when a tender may come to fruition is always a bit risky. We haven't necessarily banked on those in terms of our underlying forecast, but our goal is to have sufficient arrows in our quiver, so when things materialize, we can continue to layer on meaningful growth over the course of what's been pretty compelling top line progress. The international geographies will continue to be critically important for us moving forward, and those will be complemented by continuing strength in our U.S. franchise.

Okay. Understood. And on the IFC launch, it's great to see you're making progress picking up BLA with your partners across the country. When should we be thinking about a potential inflection point for IFC and our models here? Is early 2023 kind of the right way to be thinking about that?

Yes, thanks, Eric. It's been great to see the progress we've made on the BLA, opening up a nationwide launch here in Q1. I think certainly, with some headwinds presented by COVID and just sort of access to hospitals, it’s hard to make the progress we'd like. At the same time, we're really excited about the clinician interest and the contracting that's underway. I think perhaps too, to give additional perspective, Vivek is closest to this; Vivek, do you have any additional thoughts?

Sure. I’d say that the progress with our production partners and their ability to ramp supply, coupled with what I think is a validation of the clinical unmet need and the unique utility that IFC brings to clinicians. We’ve made meaningful progress on all those fronts. Being a de novo product, we are required to go to new product committees of hospitals or group purchasing networks. Those new product committee meetings have been held less frequently during COVID than previously. If you think about all the work we did on the platelet side, that foundational work for getting on contract, incorporating into hospital IT systems, that occurred before the COVID crisis hit. When COVID hit, we were really driving same-store sales and going deeper. Now we’re trying to do a lot of that preparatory work in the midst of COVID. Access is starting to open up a bit more; our reps have been able to get into hospitals, get in front of C-Suite executives at key hospital networks, and we’re starting to generate those initial influencers and key customers as evidenced by what we’ve seen in parts of the U.S. So a lot of things are opening up, and I think we’re optimistic. That should lead to over the next couple of years, particularly 2023 and beyond, for the IFC business to be a strong driver in addition to our overall top line progress.

That's great. Thank you for the questions.

Thanks a lot, Eric.

I am showing no further questions at this time. I would now like to turn the conference back to our President and CEO, Obi Greenman.

Well, thanks very much for joining us today and for your continued interest in Cerus. We're looking forward to updating you on our progress throughout the remainder of the year and later in the summer on our Q2 results. Thanks very much.

Thank you so much, presenters. Ladies and gentlemen, this concludes today's conference. Thank you again for your participation and have a wonderful day. You may all disconnect.