Earnings Call Transcript - RNXT Q2 2025

Operator, Operator

Good afternoon. I'll be your conference call operator today. Please note that today's call is being recorded and all participants other than the management are in a listen-only mode. There will be a Q&A session following management's presentation. I will now turn the call over to Valter Pinto, Managing Director of KCSA Strategic Communications. Please go ahead.

Valter Pinto, Managing Director

Thank you, operator, and good afternoon. Welcome, everyone, to the RenovoRx Second Quarter 2025 Conference Call. I'm joined today by RenovoRx's leadership team, including Dr. Ramtin Agah, Chairman, Founder, and Chief Medical Officer, Shaun Bagai, Chief Executive Officer, Lisa Gentry, Chief Clinical Officer, and Ronald Kocak, VP Controller and Principal Accounting Officer. Before we begin, I'd like to remind everyone that statements made during today's conference call may be deemed forward-looking statements within the meaning of the Safe Harbor of the Private Securities Litigation Reform Act of 1995 and applicable federal securities laws. Actual results may differ materially and adversely from what is contemplated by such forward-looking statements due to a variety of risks, uncertainties, and other factors. The company's forward-looking statements are based on management's current plans and assumptions and are subject to the risks and uncertainties more fully described in the company's filings with the SEC. These statements reflect management's view of current and future market conditions, including, but not limited to, statements regarding the company's clinical trials and other research studies, timing for potential additional interim data readouts in full patient enrollment for RenovoRx's ongoing Phase III TIGR PACT clinical trial studying intra-arterial gemcitabine, also known as IAG, in locally advanced pancreatic cancer. The potential of the RenovoCath device as a standalone commercial product or the transarterial microperfusion therapy platform, also known as TAMP, as a mechanism of action, the anticipated timing for and levels of revenue generation from RenovoCath sales, the company's commercialization plans in general, the potential for IAG to treat or provide clinically meaningful outcomes for certain medical conditions or diseases, and RenovoRx's efforts to explore commercialization strategies utilizing the TAMP therapy platform. For a detailed discussion of material risks and uncertainties facing RenovoRx, I refer you to the company's annual report on Form 10-K for the year ended 12/31/2024, as well as the company's investor presentation and other reports filed periodically with the SEC, including the Form 10-Q for 2025, which we just filed with the SEC. Except as required by law, RenovoRx disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. With that, it's my pleasure to turn the call over to Dr. Ramtin Agah, Chairman, Founder, and Chief Medical Officer of RenovoRx. Ramtin, please go ahead.

Ramtin Agah, Chairman, Founder, and Chief Medical Officer

Thank you, Valter, and good afternoon, everyone. 2025 thus far has marked the most transformational period in our company's history. As everyone knows, late last year, we launched the commercialization of the RenovoCath device as a standalone product within its FDA-cleared indications for use. While we continue to make progress with our Phase III TIGR PACT trial, our clinical and commercial team have executed well, and I could not be more excited about our future. Our proprietary transarterial microperfusion therapy platform, or TAMP, is designed for targeted therapeutic delivery across the arterial wall near the tumor site to deliver the target tumor. By localizing and targeting delivery of therapeutic agents via the peripheral vascular system, TAMP is designed to optimize drug concentration precisely where it is needed. This targeted approach can minimize systemic exposure and toxicities related to chemotherapy and addresses the long-standing challenge in cancer care of full blood supply to tumor sites. We believe that TAMP, by using the body's existing microvascular tear pathway called the VISTA VESERO, represents a significant advancement in the way cancer treatment can be approached. We began commercializing RenovoCath in 2024 and without a sales and marketing team in place, we are proud to have achieved over $400,000 in sales in the second quarter, a significant accomplishment in a short period of time. These initial sales prior to installing the sales and marketing infrastructure highlight the strong clinical need and market demand for our patented RenovoCath device as a standalone targeted drug delivery product among both new and existing customers. Equally important is our Phase III TIGR PACT trial. The fifty-second event in our trial occurred in Q2, triggering the pre-planned second interim analysis and review by the independent data monitoring committee, known as the DMC, which happened recently. As a reminder, the DMC reviews the trial data and makes recommendations to our company, mainly whether the data was compelling enough from their perspective to move forward with the trial or not. We're excited to report that the DMC recently completed the review of our second planned interim analysis and has recommended that we continue the study. This is great news, as we believe DMC's recommendation is an expression of confidence in the potential for a positive outcome in the trial overall. With a view towards preserving the integrity of the TIGR PACT trial for FDA purposes, and following our review of general FDA guidance, discussions with the DMC, and consultation with regulatory advisers, we have decided to defer publishing our second interim data. Outside of myself, who has been speaking directly with the DMC, our entire team will remain blinded to the interim data. We will revisit publishing the actual second interim data most likely upon completion of this study, as is common for pivotal Phase III trials. Meanwhile, the TIGR PACT trial is continuing as planned. As of August 12, 2025, ninety-five patients have been randomized, and sixty-one events have occurred, putting us on target to complete enrollment later this year or early next year. At RenovoRx, our mission remains clear: transform patient outcomes through safer, more effective targeted therapy, especially for those battling difficult-to-treat cancers like locally advanced pancreatic cancer. Thank you all for your continued support. With that, I will turn the call over to our CEO, Shaun Bagai. Thank you, Ramtin.

Shaun Bagai, Chief Executive Officer

As Ramtin mentioned, 2025 has been a breakthrough year for our company, and during the second quarter, we made meaningful progress commercially and in the clinic. The second quarter showcased the early impact of our commercial strategy, and we are pleased to report second quarter 2025 revenue of over $400,000. We are proud of the initial organic revenue growth over the first two full quarters since the launch of RenovoCath commercial sales, especially since this was achieved without a dedicated sales and marketing team. With the recent hiring of Phil Stockton as our Senior Director of Sales and Market Development, our goal is to stay lean while also continuing to build commercialization momentum. We will continue to gather important data about our market, such as sales cycles, activation times, individual customer preferences, and other commercial matters, as we seek to grow our customer base, fulfill repeat RenovoCath orders, and position ourselves for commercial growth over the long term. We believe RenovoCath is positioned to address a significant unmet need in oncology, supported by a compelling market opportunity as an innovative approach to drug delivery. Our commercial vision and internal market analysis continue to indicate an initial U.S. total addressable market for RenovoCath as a standalone device, with an estimated initial $400 million peak annual U.S. sales opportunity. Beyond historical RenovoCath usage, we are already beginning to see interest in the adoption of our technology for the treatment of other solid tumors through our commercial efforts. This broad interest serves as the basis for our belief in the potential for a several billion dollar total addressable market for the RenovoCath device alone as we expand into additional cancer applications. On the clinical front, as Ramtin mentioned, we received a positive independent DMC recommendation to continue our Phase III TIGR PACT trial based on interim data review. We are very excited about this development and what it means for the future prospects of our Phase III trial. I would now like to turn the call over to Lisa Gentry, our Chief Clinical Officer, who will elaborate on our clinical programs. Lisa?

Lisa Gentry, Chief Clinical Officer

Thank you, Shaun. To reiterate, the DMC has recommended that RenovoRx continue the TIGR PACT trial following their review of the pre-planned second interim analysis, which was triggered at the fifty-second event. As Ramtin mentioned, as of August 12, 2025, we have randomized ninety-five patients and sixty-one events have occurred, keeping us on track to complete enrollment later this year or early next year. The trial design calls for one hundred and fourteen patients to be randomized, and the final TIGR PACT analysis will be triggered upon the eighty-sixth event. We are also advancing our research pipeline. Last week, we announced the launch of our multicenter post-marketing registry study called Panther, to follow patients undergoing cancer treatment delivered by RenovoCath to solid tumors. The Panther study is an important initiative aimed at evaluating the safety and effectiveness of RenovoCath in a real-world clinical setting. This study is designed to assess long-term safety and survival in patients with solid tumors who receive targeted drug delivery via RenovoCath. By collecting real-world data on the use of RenovoCath across a broader range of tumor types, the Panther study aims to provide valuable insights into patient outcomes and support the generation of additional safety data. Panther marks a significant step forward in our commitment to better understand and demonstrate the long-term safety and therapeutic potential of our RenovoCath device. And now I will turn it back to Shaun.

Shaun Bagai, Chief Executive Officer

Thanks, Lisa. You and your team have done a wonderful job with our Phase III trial. We are excited about the continued validation of our platform, progress of our commercial strategy, and strong execution by our team. Additionally, each cancer center participating in the registry study will purchase RenovoCath devices from RenovoRx for use in the study. With that, I will turn the call over to Ronald Kocak, our VP Controller and Principal Accounting Officer, to review the financials before Q&A. Ron?

Ronald Kocak, VP Controller and Principal Accounting Officer

Thank you, Shaun. For the 2025 ending June 30, RenovoRx reported revenues of approximately $422,000 from commercial sales of RenovoCath, driven by new customer purchase orders and early repeat orders from our initial sites. Research and development expenses were $1.4 million for the second quarter, reflecting a $100,000 decrease from the same quarter year over year. The decrease is primarily due to other clinical and regulatory expenses, including an allocation of selling, general, and administrative expenses of $200,000. This decrease was offset by an increase in non-engineering costs on our RenovoCath device of $100,000. Selling, general, and administrative expenses were approximately $1.5 million, remaining unchanged from the same quarter last year. We ended the quarter with $12.3 million in cash and cash equivalents on hand. We anticipate revenues from RenovoCath sales orders to reduce our burn rate over time. We believe that cash as of June 30, 2025, will fully fund both ongoing RenovoCath commercial scale-up efforts and additional progress towards the completion of the Phase III TIGR PACT trial. Common shares outstanding as of August 11, 2025, totaled 36,645,884. With that, I will turn the call back to the operator for Q&A.

Valter Pinto, Managing Director

Operator, please open the line for questions.

Operator, Operator

Thank you. We will now be conducting a question and answer session. If you would like to ask a question, please press 1 on your telephone keypad. A confirmation tone will indicate that your line is in the question queue. You may press 1 2 if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset and press the star key. One moment, while we poll for questions. Our first question comes from Scott Henry with AGP. Please proceed with your question.

Scott Henry, Analyst

Thank you. Good afternoon. Certainly a lot to talk about. I guess, just for clarification, the decision was to maintain the trial at the same number of patients. I know sometimes they can add patients. It sounds like they did not. But just want to clarify that.

Shaun Bagai, Chief Executive Officer

Hey, Scott. Thanks for the question. Yeah. The thing that's a good thing to point out is the DMC feedback we got seemed very positive. And maintaining the same sample size, the same number of patients. So we did not add patients to the trial.

Scott Henry, Analyst

Okay. Great. And I know after the first analysis, you did comment on a lot of the data but not the second analysis. Is that because it's closer to the end? Is there any kind of reason why, you know, it was okay the first time, but not the second time? I certainly understand. That's the way a lot of these things work, but I just wanted to hear your thoughts.

Shaun Bagai, Chief Executive Officer

Yeah. Scott, you nailed it. As a reminder, we had significant positive results from our Phase I/II trials showing a potential for increasing the lifespan of pancreatic cancer patients and really reducing the side effects and toxicities. This allowed us the confidence to jump straight into a Phase III randomized trial, which should be pivotal. The FDA agreed based on our preliminary data from the Phase I/II trials, we could jump to a Phase III trial. In most circumstances, you would conduct a prospective Phase II trial to help inform design. With that confidence, we went to Phase III. Not having done the Phase II, taking a very early look, i.e., 30% of the data would give us confidence that we are on the right path, almost in lieu of a Phase II trial. And being that early in the study, we didn't feel like it would bias or jeopardize the study in any way. And you nailed it. Now that we're nearing the end of the trial, and already there's enthusiasm for the potential positivity, we didn't want to introduce any bias at this late stage in the game, how close you are to the finish line. The DMC's confidence to move forward to completion and to protect the integrity of the trial made it sensible to keep this with the highest chance of success with the FDA at the end.

Scott Henry, Analyst

Okay. Makes sense. Certainly. And then, you know, it looks like you need to enroll 19 more patients. You know, the pace of the past few months would seem to indicate that that could, you know, reach till mid-2026. But it sounds like you think it could be a little bit earlier. Are you expecting kind of a ramp-up? Is it kind of the fall? Maybe it's slow in the summer. But it seems like the enrollment pace is expected to increase near term.

Shaun Bagai, Chief Executive Officer

Yeah, Scott. Thanks for the question. A couple of things to keep in mind regarding enrollment: we enroll treatment-naive patients. We then go through an induction phase to weed out patients who might have micrometastasis. Then we randomize patients who are truly locally advanced pancreatic cancer. So there is kind of a fallout in that middle phase. We've randomized 95 to date. We need to randomize 114 to stop the study or complete enrollment. So enrollment completion is what we're aiming for, and we anticipate being towards the end of the year or first quarter of next year. Also, you're 100% correct. We've added some larger volume, more well-known cancer centers in the last several months, including the University of Nebraska, Northwell, and Johns Hopkins. We anticipate that with these larger cancer centers, we should start seeing a ramp-up coming out of summer. So it's a combination of getting enrollment done and these new centers coming on board that help accelerate enrollment towards the end of the year, if not the beginning of next year.

Scott Henry, Analyst

Okay. Great. Just a final question, then I'll jump into the queue. On the Panther trial, when should we see data coming out of that?

Shaun Bagai, Chief Executive Officer

It's interesting. It's a broad-based post-market device registry. There’s not a prespecified endpoint with data. As investigators and the company see interesting findings, we can publish and present data along the way. One exciting aspect of the Panther study is it is a solid tumor registry. While their experience to date has primarily been in pancreatic cancer, it allows us to collect, capture, and then present data outside of pancreatic cancer. As we start to see either trends in usage or trends in results, we can begin to publish and present data along the way. So not a great answer in terms of timing, but it is imminent. We look forward to exploring the use of RenovoCath beyond where we've seen it to date. Another interesting aspect about the Panther trial is that these centers will be purchasing devices to explore further uses of the RenovoCath, which could help with revenue as well.

Scott Henry, Analyst

Okay. Great. Thank you for taking the questions and congratulations on a lot of progress in the past few months.

Shaun Bagai, Chief Executive Officer

Thank you, Scott.

Operator, Operator

Our next question comes from Edward Wu with Ascendiant Capital Markets. Please proceed with your question.

Rafay Khalid, Analyst

Hi. It's Rafay for Ed Wu, Ascendiant Capital Markets. Can you give an update on your previously mentioned partnering with the top 200 cancer centers?

Shaun Bagai, Chief Executive Officer

Yeah. Thanks for the question. Great to talk to you. Thanks for calling in. So there are about 200 cancer centers across the U.S. that treat the majority of nonmetastatic GI solid tumors. So it's a good example market for us for pancreatic cancer. The way I've characterized these 200 centers is it wouldn't take a large sales force to penetrate them. We operate in this commercial environment very leanly without needing a large expensive salesforce, allowing us to have deep penetration targeting some of these top centers. We've already announced that we're in 13 hospitals with VAC approvals, indicating that the hospitals are approved to purchase the device. Four of these have started using the device and treating patients and generating reorders as well. As for public use of their names, we mentioned Hackensack Medical Center in New Jersey, and as we get permission to use names, we'll start making more announcements about exact centers involved. We are also on the verge of launching a RenovoCath website where patients can find which centers are offering the technology. So in the near future, you'll be able to see which centers are involved as we gain permission to use their names.

Rafay Khalid, Analyst

Okay. Great. Can you also discuss any plans for the RenovoCath for international markets?

Shaun Bagai, Chief Executive Officer

Yeah. It's an interesting topic. Given the reimbursement tailwinds and the cost of doing business here in the U.S., and the large market and unmet need here, we're hyper-focused on the U.S. market first. We do anticipate down the road, once we establish the U.S. market, to explore internationally. There is a large volume of cancer patients without effective technologies or therapies across Europe and different Asian countries. We've begun dialogues with investigators there over the years and also potential partners. As we start to really get traction in the U.S., we'll further explore outside the U.S. markets either with a partner or on our own.

Rafay Khalid, Analyst

Great. Thank you very much.

Shaun Bagai, Chief Executive Officer

Thanks for the questions, Rafay.

Operator, Operator

As a reminder, if you'd like to ask a question, please press 1. Our next question comes from Swayam Pakula with H.C. Wainwright. Please proceed with your question.

Rafay Khalid, Analyst

Thank you. This is Rafay from H.C. Wainwright. Good afternoon, Shaun. So, looking at your revenues of $422,000, I'm just trying to figure out, is any of it any of the revenues coming from purchasing for the clinical studies itself, or is all of it really commercial dollars?

Shaun Bagai, Chief Executive Officer

Okay. This is a great question. I really appreciate you asking because it's a great delineation. This revenue is all non-TIGR PACT Phase III revenue. These are all brand new customers who were outside of the trial or outside usage of the trial. Any revenue, as we do charge for the catheter, is reimbursed within the Phase III TIGR PACT trial. But revenues from those are not recognized as revenue but considered an R&D offset, which you can see from our filings. It's important to note that the revenue stream is all external to TIGR PACT. As mentioned earlier in Scott's question, we aim to complete enrollment towards the end of this year, beginning of next year. After that, those 18 centers in the TIGR PACT trial can and most likely will convert to commercial paying customers, where they can start treating patients with various ailments using the device. Those purchases will be revenue towards the company in terms of revenue recognition. So the TIGR PACT sites using catheters does help our bottom line, but the $422,000 just announced does not include any of that revenue recognition. On the flip side, because the Panther study is a post-market device registry, revenue obtained for the Panther sites will count towards revenue recognition.

Rafay Khalid, Analyst

Okay. And then so on the Panther study, since it's a registered study, do you really have a specific number of centers or anything like that? Or it obviously depends on which center wants to utilize the device and want to be part of the registry. How does that work?

Shaun Bagai, Chief Executive Officer

It's relatively open. We don't have a small limited number of patients or centers. As we're discussing with centers, if there's academic interest in collecting data around certain patient populations, we'll partner with them. It is not limited. We're also looking at investigator-initiated trials. There are interesting research ideas outside what we've seen usage so far, that would most likely fall under the registry or an IIT, and those don't have to be mutually exclusive. We could also perform investigator-initiated studies within the registry and use those research ideas. That gives us a lot of leeway and optionality in terms of what patients might be studied and what data might be published and presented to show where the RenovoCath can really help patients and push the science behind this and help us capture additional hospitals with academic interest.

Rafay Khalid, Analyst

And then for the Panther study, I know you're not really started bringing in patients. But when you started talking with your advisers, what sort of solid tumors were they thinking could be a good possibility for the utility of RenovoCath?

Shaun Bagai, Chief Executive Officer

I really appreciate this question because given the success we've seen in pancreatic cancer, there is a vast interest beyond what we primarily studied, specifically in locally advanced pancreatic cancer. The biggest interests have been locally advanced pancreatic cancer following fulphirinox treatment. As most are aware, the Phase III trial design has a gemcitabine plus Abraxane induction phase. Many patients opt for fulphirinox, especially the younger healthier patients. Coupling local treatment with the fulphirinox induction is of interest. We’re also exploring the use of the technology beyond locally advanced pancreatic cancer, in resectable or borderline resectable pancreatic cancer patients. There’s interest in studying in metastatic pancreatic patients as well, where local control could be important, or could even have effects on the immune system with different agents. Beyond pancreatic cancer, the most common requests or discussions have been around cholangiocarcinoma or bile duct cancer. Given the similar nature of these tumors being hypovascular or having less blood supply, there's interest in studying them. Beyond that, there’s been interest in non-small cell lung cancer, sarcomas, and head and neck tumors. It’s great to see this level of interest across different specialties based on early success in pancreatic cancer.

Rafay Khalid, Analyst

So at one point we were talking about how outside of chemotherapy, additional drugs or drug categories could also be part of RenovoCath. Do you end research that sort of data in between this Panther study, or is it going to be purely the typical chemotherapy that you're currently using within the TIGR PACT study?

Shaun Bagai, Chief Executive Officer

Beyond other tumor types, that's exactly what we will be studying is other agents as well. Physicians have shown interest in moving beyond gemcitabine, either with multiple therapies or with drugs that might be more caustic or toxic. For example, platinum-based drugs are a big interest and one of the biggest limitations of systemic fulphirinox. Several classes of immunotherapeutics have been tried and tested in pancreatic cancer and other tumors. One of the reasons is the desmoplastic barrier, high pressure, and tumor resistance to immunotherapy. We can overcome that with TAMP and the RenovoCath. Delivering different agents that might help turn on the body's immune system to attack metastatic disease can open a large potential for patients. The registry, both in of itself and the IITs we’re discussing give us avenues to explore these areas and collect and present data beyond gemcitabine and beyond locally advanced pancreatic cancer.

Rafay Khalid, Analyst

Okay. The last question: bringing onboard Phil Stockton. So what should we expect now that you have your Senior Director of Sales? Should we expect that the trajectory of revenue to be much better in three or six months down the line? Or is it his responsibility more to get ready when you get through the TIGR PACT and get any additional FDA approvals?

Shaun Bagai, Chief Executive Officer

I appreciate the question, Rafay. It’s the former. Given the early traction we saw and we posted, I believe we've achieved two good quarters so far primarily through grassroots efforts from myself and a few team members without having a sales and marketing team. We can see the upside in market penetration and potential to drive revenues. Bringing on Phil and a small team to ramp up commercialization efforts now makes sense, rather than needing to wait for the drug-device combination in 2026 to start driving towards profitability or cash flow breakeven. As this team gets in place, we drive market penetration, and I see 2025 with Phil at the helm learning the sales cycle and gathering sales metrics on how we can optimize that. We plan for a more full penetration and launch in 2026 into some of those 200 accounts alluded to earlier.

Rafay Khalid, Analyst

Okay. Thank you. Thanks for taking all my questions, Shaun.

Shaun Bagai, Chief Executive Officer

Thanks, Rafay. I appreciate the questions.

Operator, Operator

Our next question comes from Jason McCarthy with Maxim Group. Please proceed with your question.

Rafay Khalid, Analyst

Hi, guys. This is Rafay on for Jason. Thanks for taking the questions. We're wondering, have you guys engaged or plan to engage with the FDA regarding a potential accelerated approval pathway?

Shaun Bagai, Chief Executive Officer

Thanks for the question, Rafay. So from the DMC readout, the goal is to complete the study as an overall survival study. The plan would be that as we prepare for an NDA, we'll engage with the FDA to see if there's a possibility for accelerated approval. Given the unmet need and failed treatments in pancreatic cancer, moving from trial completion to potential approval as fast as possible makes sense. So, short answer, yes. As we start narrowing final data, we will engage with the FDA to see if acceleration is a possibility.

Rafay Khalid, Analyst

Okay. Got it. Thanks. And then how does the sixteen-month median OS from the first interim compare to outcomes from other trials in the setting that also used induction chemo?

Shaun Bagai, Chief Executive Officer

Rafay, I appreciate the question because it's important to see that we're aligning our expectations for this patient population. Previous large randomized studies have shown that locally advanced pancreatic cancer should yield an overall survival from diagnosis to death, with reports showing anywhere between twelve to eighteen months. The fifteen point five months estimated we saw in the control arm in our first interim analysis fits right in the middle of that range. Further validation can be seen with the previously completed Panova three NovoCure trial, which I believe showed fourteen point two months in their gemcitabine plus Abraxane control arm and about sixteen point two months in their Tumor Treating Fields plus gemcitabine plus Abraxane. So we're right in the middle of expected outcomes for locally advanced pancreatic cancer. Now, interestingly, the NovoCure study achieved local control with just a two-month survival benefit, which significantly increased market capitalization for them. This indicates both strong financial and physician interest that the bar is quite low for this population. We can imagine what we could accomplish with much better outcomes.

Rafay Khalid, Analyst

Okay. Great. Thanks for taking the questions again, and congrats on all the progress.

Shaun Bagai, Chief Executive Officer

Thanks, Rafay.

Operator, Operator

Our next question comes from Scott Henry with AGP. Please proceed with your question.

Scott Henry, Analyst

Thank you for the follow-up question. Shaun, I just wanted to ask a couple questions about the catheter business. Gross margins I believe they're 64% in the quarter, which is a pretty high number for this level of revenues. Is that a sustainable number? And, you know, where could gross margins get to? On the catheter sales? Thank you.

Shaun Bagai, Chief Executive Officer

Yeah. Scott, I appreciate the question, and that's one of the benefits and the reasons why we're deciding to commercialize because this looks like it could be extremely profitable for the organization. As for direct margins, in terms of the actual materials used to build the catheter, generally, new medical devices that start to achieve success hit the 70 to 90% range, and we're getting close to that. Additional expenses reported in the queue indicate these margins are likely to improve. We plan to push that higher towards that 70 to 90% range in the not so distant future. I see gross margins increasing over time as we scale. This is due to the reimbursement in place. This is part of the decision to commercialize at this stage in the company's development process.

Scott Henry, Analyst

It would seem with these numbers, and just looking at spending, how it compares to prior quarters, that it's already maybe not significantly, but it's already cash flow positive. And by the time you add these up, this team, it should probably still be accretive at that point. Would you agree with that statement?

Shaun Bagai, Chief Executive Officer

I do. Looking at device manufacturing itself, it is accretive. As mentioned, it doesn't take a big expensive salesforce. This is one of the big advantages we have as an emerging commercial medical device organization. That's usually a high burn rate, with low margins. We've been able to achieve a lot of momentum and value creation with very little expense. With this niche market, we could achieve high revenues with a handful of sales reps. It’s also important to note, with reimbursement in place, each patient receives multiple treatments. Once a patient is identified at a hospital, they often receive between five and ten treatments. So the numbers add up quickly in terms of revenue. Without needing a large sales force, our burn can stay low, but our revenues will continue to ramp through to the end of this year and into the next year as well.

Scott Henry, Analyst

Okay. Great. And I would be remiss not to give you an opportunity to talk about your thoughts for the rest of the year, the catheter revenue. I'm not trying to get guidance out of you, but would you expect sequential gains in Q3 and Q4? I know sometimes there's a lot of upfront bolus sales and then you have to wait for reorders, but it seems like reorders are moving. Would you expect sequential gains in the coming quarters?

Shaun Bagai, Chief Executive Officer

Naturally, as you can imagine, with such a new effort, we can't give guidance currently. I really look at 2025 as a learning year, and I wouldn't measure success on a quarterly basis because there will be ups and downs and fluctuations early in the process, especially since there are multiple procedures per patient. A few patients can significantly change the dynamics, going from pretty much zero just over six months ago to where we've achieved so far with $420,000 plus this quarter is fantastic. I do see us driving hard, learning, and penetrating deeply, and bringing more of those 13 centers across the finish line to start ordering catheters and treating patients. We have a pipeline with around 20 or 30 hospitals behind them. I do see growth over the next half of the year but I really see that ramp starting more with these few new sales hires and working on infrastructure next year.

Scott Henry, Analyst

Okay. Great. Thank you for taking the questions.

Shaun Bagai, Chief Executive Officer

Thanks, Scott. I appreciate it.

Operator, Operator

Our next question comes from Steven Reed with Investments. Please proceed with your question.

Rafay Khalid, Analyst

Hey, guys. Great progress. I had a couple of questions. On the fulphirinox, are you gonna be moving to setting that in? Pigs? First? Or what's kind of your next steps?

Shaun Bagai, Chief Executive Officer

Thanks for the question, Rafay. Always great to catch up with you. As we look to gemcitabine, one reason we chose gemcitabine initially in the Phase III trial is it's well characterized and we did have a lot of early experience. As we look to other drugs, we will perform animal studies to ensure we're not causing any major damage. As we discussed, IITs and registry patients with physicians, as we look to other agents, we will ensure we perform preclinical studies to guarantee that as we move to human trials, we don't have issues. So yes, we have begun exploring what other drugs might do to the vessel wall, and like gemcitabine, it appears we have no issues.

Rafay Khalid, Analyst

Okay. So do you think a few of those studies you'll be sharing with us in the next quarters on which preclinical studies those might be? Three of the most interest.

Shaun Bagai, Chief Executive Officer

Oh, we haven't disclosed publicly where we are in the preclinical studies and which drugs. However, as we move into patients being treated, especially under the registry, we will publish data and updates as we have them.

Rafay Khalid, Analyst

It's great to see your in-house sales team coming together. Can you give us an update if you're simultaneously still working on some distribution partners? I saw in March and June that you might have issued some restricted stock in consideration for commercial contracts. Any color around that would be helpful as well.

Shaun Bagai, Chief Executive Officer

Yeah. Thanks for your question, Rafay. To clarify, we issued stock options or restricted stock to our contract manufacturer, Medical Murray, to ramp production to get us to where we are and take us to the next level in providing enough catheters. Regarding distribution, we've been talking to several potential strategic partners. As I previously mentioned, we’ll do the math to determine what makes the most economic sense. Given our achievement so far without a sales team, besides myself and a few team members, it's been financially prudent to capture all revenue versus a revenue share for this market entry. We did the math on it and will drive with our in-house team to capture the best value for our shareholders for now. We'll determine whether to scale or need to leverage distribution channels of a larger medical device company as we grow.

Rafay Khalid, Analyst

Thanks, Shaun. That’s all I have.

Shaun Bagai, Chief Executive Officer

Thanks for the question, Rafay.

Operator, Operator

It appears that there are no further questions. Today I would now like to pass the floor over to Shaun Bagai for closing comments.

Shaun Bagai, Chief Executive Officer

Thank you for the opportunity and for those dialing in and listening in. Thank you. I appreciate the questions from those who called in as well. I'm very happy and thrilled with the results we've had for our second quarter this year. Both in terms of the commercial success to date without a sales and marketing team, and the progress we’re making with the additional hire Phil Stockton as he builds out his team. Also, timing was excellent to have the DMC review the second interim analysis. We're proud that they will allow us to continue, giving us confidence towards successful clinical trial outcomes in our Phase III study in locally advanced pancreatic cancer. I'm also pleased with the prudent decision here to protect the integrity of the trial to give us the best chance of success for a potential NDA application down the road. Thank you again for everyone's participation, and I look forward to following up with individuals down the road. This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation.