Good day and thank you for standing by. Welcome to the C-Star Medical Report second quarter 2026 financial results. At this time, all participants are in a listen-only mode. Please be advised that today's conference is being recorded. After the speaker's presentation, there will be a question and answer session. To ask a question, please press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star 1-1 again. I would now like to hand the conference over to your speaker today, Jackie Kosman.

Thank you, Josh. Good afternoon, and thank you for joining the C-Star Medical Second Quarter 2026 Financial Results Conference Call. I'm Jackie Kosman with Wheelhouse Life Science Advisors. Joining me from C-Star Medical today are Eric Schlorf, Chief Executive Officer, Tim Veracek, Senior Vice President of Commercial and Business Operations, Dr. Kevin Chung, Chief Medical Officer, and Mike Messinger, Chief Financial Officer. I would like to remind listeners that comments made during this call by management will include forward-looking statements within the meaning of federal securities laws. These forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from any anticipated results. For our list and description of these risks and uncertainties, please review C-Star Medical's filings with the Securities and Exchange Commission. Furthermore, the content of this conference call contains information that is accurate only as of the date of the live broadcast, August 12, 2026. Be Star Medical undertakes no obligation to revise or update any statements to reflect events or circumstances, except as required by law. And now, I'd like to turn the call over to Eric. Eric?

Thank you, Jackie, and thank you all for joining us today. We are very pleased with our progress this quarter. Our pediatric AKI market penetration and continued strong Quell Immune revenue growth bodes well for our future potential opportunity in the adult AKI market that is 50 times larger than the pediatric market in the United States. Successful treatment of pediatric AKI with Quell Immune therapy by patient care teams is driving greater clinical confidence from the tight-knit critical care pediatric community, which we believe will only strengthen in the future potential launch of this therapy in the adult AKI market. Tim will speak further on our plans for our continued adoption of Quelamune in the pediatric AKI market and also discuss how we are strategically planning for a potential launch of this therapy in the adult AKI market. And Kevin will describe our progress in our neutralized AKI pivotal clinical trial and our regulatory strategy for the adult AKI indication. Before I turn the call over to Tim, if you are new to C-Star Medical Story, I'd like to clarify that the same foundational therapy in Quellimmune, known as the Selective Cytophenic Device, or SCD, is the same therapeutic device that we are evaluating in our pivotal study for the adult AKI indication. The adult version is simply a larger device to accommodate larger blood volumes. Also, I'd like to emphasize that our STD therapy is first in class. It is the only immunomodulatory therapy that targets and neutralizes hyperactive leukocytes and monocytes and immune cells, the immune cells primarily responsible for causing the cytokine storm that shuts down organs and takes the lives of far too many patients with AKI requiring renal replacement therapy given the unique unique mechanism of our std therapy and the significant value of finding a potential solution to this continuing unmet need i would note that we anticipate our current pharmacological or pharmaceutical like gross margins to continue for quelamune and to extend to our adult therapies if approved furthermore we believe that the fda understands the importance of bringing innovative treatments advancements to critically ill patients with AKI. The FDA approved Quellamune for pediatric AKI under humanitarian device exemption and also awarded us breakthrough device designation for the SCD therapy for adult patients with AKI on continuous renal replacement therapy, which should support a more collaborative and rapid approval process. We also have received breakthrough device designations for our other pipeline indications, including systemic inflammation from cardiac surgery and chronic inflammation in end-stage renal disease among others i provide this context today to reiterate our strong belief that our opportunity is significant we remain keenly focused on achieving our near-term goals and understand the importance of driving new customer adoption for quell immune and enrolling patients in our neutralized aki trial by the same token we are not losing sight of our long-term opportunities and what c-star medical can achieve for all our stakeholders. With that, I'll turn it over to Tim. Tim.

Thanks, Eric, and thanks everyone for joining us today. We are making great progress in our efforts to establish Quellimmune as an important therapy in the critical care of pediatric patients with AKI and sepsis. Currently, 20 of the 50 premier children's hospitals in the U.S. have purchased and used our Quellimmune therapy. Recall that our goal for 2026 is to increase the number of hospitals to 25 by the end of the year from 10 at the beginning. So, we have already doubled our customer base this year and we are well on our way to achieving that goal. And as Eric indicated, the use of Qualamune therapy is broadly resonating in the pediatric critical care community. Let me describe how. We discussed in our first quarter call the considerable interest in Quellimmune at the AKI and CRRT meeting in San Diego. Adding to the buzz we observed there, we sponsored and participated in this year's Kidney Bee Summit a few weeks ago. The summit occurs annually and brings together a highly specialized interdisciplinary team, including nurses, advanced practice providers, nephrologists and critical care physicians from across the country. Its core importance stems from tackling the exact systemic failures that leave pediatric kidney failure under-recognized. And just yesterday, we assembled leading experts in the treatment of pediatric AKI to speak at a C-STAR medical educational webinar. The webinar was entitled Rethinking pediatric sepsis-associated AKI what clinicians should know about Qualimmune. We brought together practicing pediatric nephrologists, critical care physicians, advanced practice providers, and nurses to learn more about pediatric sepsis-associated AKI, the use of Qualimmune therapy through case reviews, and how to navigate Qualimmune adoption within hospitals. Both events were very well attended and provided an opportunity for the pediatric community to get answers to key operational questions, gain exposure to the rich content from cutting-edge scientific and clinical data in sepsis-associated pediatric AKI, and how to apply that knowledge to employ our quail immune therapy at the hospitals in which they practice. As previously stated, this is an ultra-rare population with a very high unmet need, and as the first and only therapy available to treat children with AKI and sepsis, Qualimmune is helping to drive new thinking in the pediatric AKI community. Now, turning to our revenue targets and future opportunities in this ultra-rare pediatric market, we reported Qualimmune net revenues of $615,000 in the second quarter, a strong 82% increase over last year's second quarter. And with six-month net revenue at $1.1 million, momentum remains strong as we advance toward our 2026 net revenue target of $2 million. In short, we are very encouraged by the current rate of Qualimmune adoption, and we continue to focus on adding new customers as quickly as possible. We have great expectations of helping more patients by bringing our Qualimmune therapy to more pediatric hospitals. And as we look to 2027 and beyond, we believe we can expand our overall market opportunity beyond the top 50 pediatric medical centers. We announced in June that the Centers for Medicare and Medicaid Services, also known as CMS, assigned ICD-10 PCS codes for our SCD therapy, allowing hospitals to efficiently bill for qualimmune therapy when used in treating sepsis-associated pediatric AKI. And we believe all future potential indications from our SCD therapy will use the same PCS code. The implementation of the new ICD-10 PCS code initiates on October 1st of this year. This is an important administrative development as it removes another potential barrier to qualamine adoption. In addition, we have completed the 50-patient SAVE registry that was required by the FDA to further evaluate the safety of our qualamine therapy. Our preliminary report was submitted, and we are now preparing the final report for FDA review. Our results from the first 21 patients were reported in the prestigious peer-reviewed journal, Pediatric Nephrology, and that alone has driven continued interest in adopting Qualimmune. So in summary, the future for our Quell immune therapy looks bright as we continue to expand into the pediatric market and work in parallel on pre-commercialization efforts focused on the adult AKI population, which is estimated to be 50 times larger than the sepsis-associated pediatric AKI population in the U.S. Thank you for your attention. And with that, I'll turn the presentation over to our Chief Medical Officer, Kevin Chums. Kevin?

Thanks, Tim, and thank you to everyone for listening to our call. I want to echo Tim's enthusiasm about our growing presence in the pediatric critical care community. It is rewarding to hear how these nephrology and critical care teams are adopting Necoil Immune Therapy and understanding that it is truly the first of its kind. These kids have days, if not hours to live, and we have heard many stories about first-time use of Quell-Immune with life-saving outcomes. These stories are truly remarkable, and they continue to validate and reinforce why getting this therapy to a broader patient population is so important. And to be clear, we believe that Quell-Immune for pediatric AKI indication is just the first of a broad range of indications for SCD therapy. To our knowledge, no other pharmaceutical therapy or medical device on the market today is able to identify, target, and neutralize the specific immune cells that cause hyperinflammation. That means the SCD's unique immunomodulatory mechanism positions us to potentially reshape treatment paradigms across a range of serious inflammatory conditions, not only for AKI, but cardiorenal syndrome, systemic inflammation from cardiac surgery, chronic inflammation and end-stage renal disease, and other states of pathologic immune activation where dysregulated cytokine release drives organ failure and death. Which brings me to the discussion highlighting our efforts to bring our SAD therapy to critically ill adult patients with AKI requiring CRT. We are currently conducting the neutralized AKI trial and have plans to file a modular pre-market approval, or PMA, with the FDA to potentially speed the overall approval process for this important indication. The modular PMA enables the FDA to review and potentially comment on portions of our application prior to submitting all modules, the last of which would be the submission of the Neutralize AKI clinical trial results. I would also note that we have been awarded breakthrough device designation for this indication, which should support expedited regulatory review. As a reminder, our Neutralize AKI pivotal trial is a randomized control trial designed to assess the SED therapy in critically ill adult patients with AKI requiring CRT. The primary endpoint is a composite of mortality or dialysis dependence at 90 days. We now have enrolled 223 of our total anticipated 339 patients in the trial and have stepped up our site recruitment to accelerate the pace of enrollment as we move forward. We recently onboarded two additional clinical sites who have already recruited patients. We have four additional sites that we anticipate will be screening patients shortly, and at least eight more sites that have committed to participating in the trial. Our sites are extremely motivated and are continuously screening patients. When they identify potentially eligible patients, our sites are typically able to successfully consent and enroll those patients into our trial. This reflects highly on the site investigators and incredibly professional research staff who are tactfully approaching family members during a patient's most desperate hour in the ICU. We must emphasize that we continue to be focused on enrolling the right type of patients. This careful selection of patients is essential to demonstrating therapeutic effect in avoiding the limitations that have confounded prior AKI and sepsis trials. One of our enrichment criteria is a C-reactive protein, or CRP level, greater than 3.5 milligrams per deciliter. Patients who do not have a CRP greater than 3.5 are excluded. Why? CRP is a very sensitive marker of inflammation, and those patients with a low CRP are unlikely to benefit from our therapeutic device. In past interventional sepsis or AKI trials directed at inflammation, many of these types of patients were included, and those trials ultimately failed. Beyond CRP, we are also applying our carefully considered exclusion criteria to remove patients whose pre-existing conditions could obscure the true treatment effect, patients who might not survive regardless of whether the SCD works. This is the same discipline approach we took in our pediatric trials, and it is the right way to design a study that can demonstrate therapeutic benefit. It is worth emphasizing that clinical trial populations are by design more narrowly defined than real-world practice. We are seeing in the commercial setting physicians who are already applying Qualimune to our much broader unlabeled population of pediatric patients than those enrolled in our trials, including patients with complex comorbidities who would not have met trial eligibility criteria. That broader real-world use reflects clinical confidence in the therapy and suggests the addressable patient population is larger than what our trial enrollment numbers alone might imply. We're making meaningful progress in Neutralize AKI. In our confidence in the trial design, incite execution has never been higher. As we discussed, enrolling the right patients takes precedence over enrolling quickly, and our sites are delivering on that standard. While we expect to complete enrollment around year-end or in the first quarter of 2027, our PMA submission timeline in late 2027 remains unchanged. changed. The breakthrough device designation we hold for this indication means that when we submit, the FDA is positioned to move quickly. A PMA approval of the SED therapy for adult patients with AKI on CRT would enable commercialization with ICD-10 PCS codes in place, significantly simplifying hospital adoption. Also, given the foundation we are establishing in the pediatric critical care community with Quellimmune, we believe it would support more rapid adoption among nephrology and critical care experts in the adult AKI community. We are passionate about our ability to improve and potentially save lives of these critically ill patients and look forward to reporting our progress. And with that, I'll hand it over to our CFO, Mike Messinger.

Mike. Thank you, Kevin, and thanks, everyone, for joining our call today. I'll provide a brief overview of our financial results for the second quarter of 2026. Please note that our Form 10-Q will be filed with the SEC within the next 24 hours, and it will include a lengthier discussion of the company's financial results for the three months ended June 30, 2026. You will find the 10Q at sec.gov or through our website at cstarmedical.com. We recorded net revenue for the second quarter of $615,000, reflecting increased demand for Quelamute. This represents an 82% increase compared to net revenue of approximately $338,000 for the second quarter of 2025. And this is an increase in the rate of growth from the 69% growth we had in the first quarter. And we continue to maintain our gross profit percentage of over 90% in the second quarter of 2026, consistent with the prior four quarters. Turning now to our operating expenses. In the second quarter of 2026, we reported $4.4 million in operating expenses compared to $2.1 million in the second quarter of 2025. Our research and development expenses increased primarily to the additional clinical sites and increased patient enrollment compared to the same period in 2025. And our general administrative expenses increased compared to the second quarter of 2025, primarily to an increase in compensation costs, legal and professional fees, and certain SEC-related expenses. As we indicated in our first quarter call, we expected our sequential quarterly research and development costs to increase based on adding additional clinical sites and our focused recruitment efforts. We did see a roughly mid-single-digit increase over our first quarter and we continue to expect the same for the rest of 2026 as we anticipate meeting our enrollment goals. Net loss for the second quarter of 2026 was approximately $3.7 million or 91 cents per share based on weighted average shares outstanding of approximately 4.1 million shares. This compares with a net loss of approximately $2 million or $1.77 per share in the second quarter of 2025 based on approximately 1.1 million weighted average shares outstanding. We had approximately $7 million of cash on our balance sheet at June 30th, 2026, compared to $12 million at December 31st, 2025. And with that, I'll turn it back to Eric.

Thanks, Mike. Our goal today was to share with you our second quarter achievements, but also express how keenly focused we are on the key value drivers, both short and long term for our stakeholders. We have a small but passionate team at C-Star Medical, yet we believe we are reshaping the possibility for kids and in the future, potentially adults that often face organ failure or death without new therapies to modulate the cytokine storm in acute kidney injury. Our goal is to set a higher standard for the treatment of all patients that face the trauma of AKI. We believe that the opportunities that lie ahead for C-Star Medical are significant, and we look forward to reporting our future progress. With that, I'll ask the operator to open the call for questions.

Operator? Thank you. As a reminder, to ask a question, please press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one one again. One moment for questions. Our first question comes from David Bouts with Zach's Small Cap Research. You may proceed.

Hey, good afternoon, everyone. I appreciate you taking the questions. First of all, I was wondering if you could comment on what the current monthly enrollment rate is for the Neutralized AKA study, and if you're seeing any type of acceleration of enrollment at the newer high-volume sites. And then lastly, can you quantify your confidence for hitting that 339 patients either by year-end or the first quarter of 27?

Yeah, so thanks for the question. So, you know, let me tackle the second one. You know, what we've basically kind of guided the market is really our timeline is around year-end or, you know, into Q1. Obviously, it's going to depend on, you know, Kevin and his team bringing on additional sites, et cetera, from an enrollment standpoint. But, you know, I'm really proud of what Kevin and his team are doing on bringing those, you know, kind of on pace. But, you know, if I think about this, David, before he kind of talks about maybe enrollment, You know, we still believe that we're really on track at the end of the day to have end of 2027 submission for the final PMA module, which, you know, obviously really not impacting the timeline. But maybe, Kevin, you could talk a little bit about enrollment of various sites.

Right. Thank you, Eric. So, on average, over the last few months, we've averaged somewhere around 8 to 10 to 12 patients in each of those months. and that's relatively slower than what I would like. However, I have to emphasize we have to get the right patients and by right patients, I mean those with modifiable disease. What's the point in getting finished with enrollment if we enroll a bunch of patients out of haste to try to just get our number and we're not enrolling the right patients? That would be a flawed strategy. For me, the focus is on getting the right patients enrolled so that we optimize our chance for success. That's number one. Number two, as we discussed in the report, in our update, we're very busy right now activating in the process of activating numerous sites. As I said, there are four that are so close to getting activated, just some residual signatures and et cetera, those kinds of things, and we're ready to activate them. And so we're going to be very soon seeing some reinforcements come in with an additional four sites ready to go, already trained. SIV has already performed site initiation visits. So we're ready to go with those sites. There are an additional eight sites, half of whom contacted us because they wanted in on the trial. And so they've committed. Now, whether or not we're going to be able to activate all eight sites is still debatable, but we're going to try to get as many sites activated as possible because that's going to get us to 15 to 20 subjects per month, which is more at the pace that I would like. Again, though, focused on the right patients. We have to get the right patients. We have to get that right to have a chance for a positive trial. Okay, great.

So, with the enrollment expected by the end of this year, early 2027, and the PMA submission target for the end of 2027, I was wondering if you just walk through what are the major activities for the PMA that need to happen, say, after enrollment or after database lock before you can, you know, fully submit it?

Yeah. So, your question is what are some of the – well, once we lock the database, obviously, then we'll give out top line uh results you know once it's locked we can analyze etc and then really it's just submitting the clinical section um it's really essentially because uh all the other previous sections will have been submitted um by that time and that's really what the goal is so that uh when the fda then has their time you know they can then focus just merely on the clinical sections and not have to go through things like device and description etc so that's really what the strategy is.

Okay, sounds good. And then last one, talking about the increase in revenue, I was wondering if you could quantify, say, the contribution from existing customers, which is the new hospitals that you added during the quarter.

Yeah, thanks. Tim, you want to tackle that one?

Sure. Yeah, so it's a combination of new hospital systems as well as existing hospital systems that delivered that revenue. And we have a very high repurchase rate with the existing sites. And then obviously the new sites that come on board, they want to stock the product as soon as they can so that they're ready to treat patients. So it was a group effort by all of the customers that were out there.

Okay, great. Appreciate you taking the questions.

Thank you. Our next question comes from Anthony Venditti with Maxim Group. You may proceed.

Yes. Hi. Thanks. Can you talk about the milestones between completing enrollment and then the final PMA submission?

I think you mentioned you submitted the preliminary, right? no we're we're submitting preliminary yeah so we're submitting no well so uh you're talking about the pma right for adults yeah yeah yeah yeah so yeah for for that i mean obviously you know what we're doing right now it's a modular pma so there's various sections where you talk about the device uh you talk about you know sterilization talk about all sorts of you know kind of the technical things that go into it uh but then you get into you know that what the goal really is Anthony, is to have those sections already submitted to the FDA, already have had the discussions with the FDA on those sections. And so, really what you're waiting for at the end is once you have data lock and then you can show top line and, you know, do the analysis, then you're really just submitting the clinical section of it.

Okay. And you see, so you've submitted already the certain sections and? No, we're in the process. So, yeah, we're in the process. yeah we're in the process of doing that yeah got it okay and then you you have right now about 20 pediatric hospitals right correct so is there is there a process or what what do you what do you have to do to make sure they're not just sort of like okay they're they're a hospital that uses this, but how do you get them to be more meaningful, recurring customers or just, hey, you just need the patients to come in and they're already on board and there's nothing really left to do with those particular hospitals?

Yeah, maybe, Tim, you could kind of address it and then, Kevin, if you would like to add any additional comments on top of it. It is really a multidisciplinary approach that we take to these hospital systems. Okay.

Yeah, it absolutely is. Just to give you insight, so let's say a hospital just came into the fold today. They've adopted Quellimmune formally. There was a whole process that took place in terms of IRB approval, becoming a qualified vendor, all the associated things you have to do to basically be a customer to the hospital system. Then a patient actually shows up in the emergency room, gets moved to the ICU, and Qualimune becomes something that's top of mind. We have then the clinical team that'll come over. They'll actually help the setup of that first patient to ensure everything goes smoothly. Now, in terms of what happens after that, there's a lot of work to do. because every hospital system is large. They have a lot of different staff. They have different shifts. And so there really needs to be an educational approach to that hospital system that never ends, because there's turnover like in any other business. And our goal is to continually increase not just the breadth, but the depth that we get to within all of our customer base and the new ones that we'll add so that Qualimune is something that's top of mind for the patient care teams because we believe that while Qualimune is a super effective therapy, if you don't know about it and a patient comes in and there's not one of your advocates there, they may not realize that they could use Qualimmune to treat that patient. So it's a continual effort from a commercial standpoint and from a clinical standpoint to ensure that we really ingrain the brand into these hospital systems and they understand the clinical value of it so that they recognize patients when they come in and they can choose to use Qualimmune therapy as an option, you know, when it's there and it's available.

Okay, so just to understand, so obviously getting into the hospital is just the first step and trying to make sure all the trained healthcare professionals that could use it, A, know the benefit, know how to use it, and you stay engaged because, like you said, if there's new doctors, nurses, or so forth that are coming in, you want to make sure that they are aware of the treatment and of the application of the Quellamune, correct? 100%.

If I may add some color to the clinical perspective. So yesterday, we conducted a webinar that we'll make available very soon so that those of you who missed the webinar or had technical difficulties are able to dial in. During that discussion, it became it was it was it's this has been clear, but it became more clear to me that there's a big difference between new sites that have device and mature sites that have device. New sites, anytime there's a new technology, even if it's life saving, because of the natural skepticism that is very prevalent within the medical community, they have to see it work. And so, you know, generally, it's used as a rescue therapy. And what I mean by that is it's used for the new sites as a last resort, oftentimes with a bunch of other experimental therapies that are not even approved being applied prior to SED. So that's new sites. That's the approach that they take. And that's been true for almost every site that have been activated, because whenever therapy is new, that's what's going to happen. And I have to say and have to emphasize that even with those types of patients that have failed other therapies, we're talking about a 70 percent survival in that population, which I have to emphasize, that's remarkable. Um, but yesterday we were, we're starting to sort of notice a shift, especially with the mature, uh, centers, with the mature sites that have been doing this now for over a year. Uh, these sites, everybody's already educated. Everybody is already has seen what I call the index case, the aha moment, the case that converted them and, uh, in their mind, um, uh, made them think, oh my gosh, we need to do this. And this is occurring, and adoption, clinical adoption mentally is occurring pretty universally across our mature sites. And so right now, as we speak, those clinicians are scanning their ICU to see who may benefit from the therapy. And so it's no longer now a rescue therapy. They're not waiting until, you know, the bitter end. they're starting these patients early, and we're seeing even better outcomes, which is just really remarkable. So that was my takeaway from the webinar. Again, we will make this available very soon, and hopefully you'll be able to watch it and verify my statement.

Thanks. No, that's helpful, Kevin. Yeah. So I mean, we know the focus, as it should be, is on You know, the pediatric market and now the adult AKI, you know, with this trial enrollment, and you're at 223 up to 339, and we know adult AKI is 50 times larger than the pediatric market. But there's other markets that, you know, that your, you know, cytopheric device can treat, whether that be acute respiratory distress, hepatorenal syndrome, cardiorenal syndrome, and, of course, sepsis. So, I know you want to stay focused as, like I said, you should, but, you know, behind the scenes, you know, can you give us some insight into, you know, what kind of work is being done on these other indications?

Yeah. So, I can tackle that one. Yeah, I mean, yeah, so, you know, we do obviously evaluate all the other applications that we believe that, you know, obviously, you know, from our perspective, there's a pretty long laundry list of things that really would be on our wish list, but obviously, you know, we as a company have to be focused on, you know, certain things, and that's really been on Quell Immune for pediatric AKI and adult AKI and neutralized AKI. Obviously, we've got the neutralized CRS study that's actually been funded by NIH. And, you know, we, I would say, you know, we have various discussions with various parties looking at, you know, everything from non-dilutive to strategic discussions, you know, business development on all these types of things to be able to really advance this, you know, the other indications that we believe we have in our pipeline. But obviously, you know, it'll just take time for some of those things to mature and we'll just have to see how they pan out.

If I may just add really quickly, I should remind everyone that for Neutralize AKI, a priori, we identify patients with ARDS at the time of enrollment and sepsis at the time of enrollment. And we randomize via this technique called block randomization. What that does is it allows equal distribution of subjects to be assigned in the ARDS bucket and the sepsis bucket and the combined sepsis and ARDS bucket, we will be able to for sure make a statement about those specific populations who have concomitant AKI, of course.

No, that's very helpful. Thank you. Thanks, Eric, Kevin, everyone. Okay. I will hop back in the queue. Thanks.

Thank you. I would now like to turn the call back over to Jackie Kosman for any closing remarks.

Thank you, Josh, and thank you all for joining us today for the C-STAR Medical Second Quarter Financial Results Conference Call. If you have questions, please contact us at ir at cstarmed.com or visit our website at www.cstarmedical.com. Thank you and goodbye.

Thank you. This concludes the conference. Thank you for your participation. You may now disconnect.