Good day, and welcome to the Sedana Medical second quarter 2022 earnings call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing Star then zero on your telephone keypad. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press Star then one on your telephone keypad. To withdraw your question, please press Star then two. Please note, this event is being recorded. I would now like to turn the conference over to Johannes Doll, CEO. Please go ahead. Thank you. Good afternoon, everyone, and good early morning to those of you dialing in from the U.S. Welcome to Sedana Medical's Q2 and half-year report 2022. I will start by giving an update on the business, then Peter will talk about the progress in the United States and some of the medical activities going on in Europe. Then Johan, our CFO, will take you through the financial update before I will close, and we'll open it up for questions as usual. On page two, as always, we will be talking about the future in this presentation, and I therefore recommend that you give a quick read to our disclaimer. Let's turn to page three, please. These days, there's so much going on, both in the world in general, Ukraine, inflation, energy crisis, recession fears, as well as in our market, specifically a significant drop of ventilated patients in the ICU, staff shortage in hospital, a mild flu season, uncertainty around COVID, that it's sometimes easy to lose sight of the essentials. Before getting into the quarter performance, I would like to take a step back and remind ourselves what Sedana Medical is about. What has always been true, and is, of course, still true, is that we have products with nice gross margins. This quarter at 70%, which can translate into a very profitable business if we reach scale. We already have proof of concept for that within our company. In Germany, even in spite of the recent sales decline, we are already to date generating very attractive EBITDA margins, which, by the way, on a local level, are even above the number that we have guided for in the long term. The key question here is: Will we reach sufficient scale? Do we believe in inhaled sedation as a concept? Do we believe we can convince enough hospitals, enough ICUs to use inhaled sedation as a new standard of care? Here I believe we have a very strong foundation. We have shown clear clinical benefits over intravenous sedation. Less opioid use, more spontaneous breathing, faster wake-up. We have shown that our patients leave the ICU four days earlier than a propofol patient. We've also shown health economic benefits, which were even confirmed by NICE in the U.K. We have everything that it takes to play an important role in the world of ICU sedation. Yes, sales are down and they're down quite significantly in the quarter. If you look one level deeper, you can see some very positive indicators. That's not just that we have sold 70% more than pre-COVID. We have also run an analysis in our main market in Germany and found that we have declined less in sales than the patients have declined, suggesting that the penetration is still pointing in the right direction. Plus, we continue to open new accounts, approximately three new accounts on average every week, and at the same time are successful in keeping our existing customers, and I'll get back to that. All of that is showing that the underlying performance is solid, and once we return to a normal state in the ICUs, this should also show in the numbers. Lastly, but very importantly, we have enough money in the bank to execute our plans, so we have our destiny in our own hands and don't need to ask the market for new money, which in these days is of course super important. Let's move to page four please, which shows a summary of the quarter. Net sales were SEK 27.6 million in a market that has significantly declined. We've been able to increase our gross margin year-over-year from 66%- 70% as a result of product mix, some price adjustment we have implemented in Q2, and also our efforts to reduce freight costs. On the operational side, we have launched our drug now in Sweden, Norway, and the Netherlands on top of Germany, where we already launched back in February, and are making progress with the local pricing and reimbursements processes. The goal, as we have stated before, is still to launch in all major direct markets and actually also a few distributor markets in the next six months if the authorities are sticking to the timeline. We can also expect Sedaconda to be approved in more countries in the second half year. Our U.S. trial, which Peter will talk about, is up and running. We are opening new sites and recruiting patients according to our plan and continue to believe that we can submit to FDA in 2024. Given the importance of the U.S. markets for us as a company, this will be, of course, very, very exciting to follow. What we have also initiated is a cost-saving program. We are clearly a growth company and cannot save ourselves to success. We have to grow, but we have identified some potential to streamline overhead and admin functions and improve overall spend effectiveness. At the same time, of course, we will, of course, not compromise our investments into making inhaled sedation the new standard of care. On the next slide, page five, a quick recap of the market dynamics we are facing in intensive care units right now. In short, we still have an unprecedented drop of ventilated patients versus the previous year. In fact, the patient gap has actually widened further versus what we have seen in Q1. The good news is that the reasons behind this decline are temporary. Yes, there are of course less COVID-19 patients, but that was expected. That's not a surprise. What is happening at the same time, though, is that non-COVID-19 patients in ICUs have dropped a lot as well. This is because ICUs are still suffering from staff shortages, leading to less elective surgeries and lower overall capacity. At the same time, we have seen much less community-acquired infections and, for example, a much milder flu season as you have probably heard from other companies operating in the same space. The big question is how long will this continue and when will we get back to a more normal state? Of course, we don't have a crystal ball either, but our expectation, which seems to match pretty well the consensus among both our customers and most of the other relevant companies like the ventilator manufacturers, appears to be that we will gradually recover in the second half year, and we'll look at a more normal situation in 2023. Again, even if this is not true and we're looking at an even longer period with less patients, our cash balance would be sufficient to get us through that as well. If we then move to the next page six, please. If we break down the sales performance by region, we see that the majority of the sales gap is explained by Germany and to a less extent also the distributor market, while we had a 31% growth in our other direct markets. According to our analysis, and I will get back to that, this 36% sales decline in Germany compares to a contraction of the addressable market, meaning ventilated ICU patients by 40%-50%. Which means that the underlying momentum of gaining market share is still intact. We had some of the same market headwinds in our other direct markets as well, but the growth, especially in Spain, France and the United Kingdom was strong enough to still show 31% sales growth. Of course, that is from a much slower base than in Germany, but I'm quite pleased of course with that development. The decline in distributor markets is still influenced by an extraordinary year 2021 as we have discussed before. You might remember that we got a lot of artificial sales in Latin America, for example, due to the propofol shortage in that region at the time. Having said that, Latin America continues to be one of our absolutely prioritized distributor markets with great potential, especially with our partner, Goba, who we are working with in Mexico, Ecuador, Colombia and now also in Brazil. We've now actually hired a Sedana Medical key account manager in São Paulo, specifically working with our partners in Latin America and giving even more support in that region. If we then turn to the next page seven, please. With all the turmoil around the COVID-19 years, it sometimes helps to take a through-cycle perspective. What you see on this slide is that we have sold 72% more in the first half of the year than pre-COVID. That's good, but of course we are aiming at further accelerating that growth when the market comes back to normal and we can fully play out the advantage of having the only approved therapy for inhaled sedation of ventilated ICU patients in Europe and having both the device and the drug on the market. If you then move to the next slide, please, page eight. I would like to show you some of the indicators that are a little hidden by the pure sales numbers. One issue we've always had is that publicly available data are not available for the number of ventilated patients in ICUs. We can get the numbers of ICU beds. We can get the numbers of ICU patients, ventilated COVID patients even on a daily basis. We did not know how many of the total number of patients were intubated. That's why we struggled a bit to show penetration numbers, for example. What we have done in the second quarter is our own little research. In the second quarter for one week in May our key account managers in Germany recorded the numbers for all ICUs that they visited that week. How many ventilator beds do they have? How many patients do they have? And importantly, how many of those were intubated? Also how many COVID-19 patients they still had left. Not a perfect research, but that way we could cover more than 1,000 ventilator beds in one week. Those findings we could triangulate with publicly available numbers, and we found that we had 40%-50% less patients than last year. It's only a snapshot of course, so we'll have to do this more often. What it shows is that we can now be quite certain that the market has declined more than our sales have declined. That's a very important finding as it implies that the penetration of inhaled sedation is still pointing in the right direction. You can also look at new customers during the first half of this year. We have opened approximately three new accounts every week. Now you could, of course, expect that we have also lost a lot of customers and that explains the sales decline, but no, we have sold actually to more customers overall in the first half of 2022 than a year before. For Germany we've made an additional analysis. We've looked at our top 100 customers from last year, and it's quite nice to see that we have not lost a single one. All of them also bought from us this year as well. All of this is at least good evidence I would say that we are heading in the right direction and the sales decline is explained by all of these ICUs simply seeing much less patients, but the overall dynamic is still there. This gives us confidence, but I also want to make very, very clear that this is not a reason for us to get complacent and just wait for the patients come back and everything will be fine. It is still very, very important and probably now even more important to pull through all the growth initiatives we have started, the work on our people's effectiveness, our selling model, et cetera. The goal here is a standard of care, and that will of course not just happen. It's a lot of hard work. If we turn to page nine, quick update on Europe. Sedaconda isoflurane is now available in Germany, Sweden, Norway and the Netherlands. We'll have more launches in the second half in France, for instance. We are now listed in the Journal officiel, meaning that our product can be reimbursed. There are still a few hoops to jump through to fulfill all the French regulation when it comes to quality systems, personnel qualification and such. At the next report, we will certainly talk about the actual launch and plans as well. Spain is a longer pricing and reimbursement process, as you probably know, but that's also ongoing, and if there's no delays from the authority side, the target remains to have the product on the Spanish market in the next two quarters as well. We have a couple of approvals coming up that we are expecting in the second half. Poland, you might remember, is the last outstanding one from the initial 15 countries included in the decentralized procedure. The excuse for the delay is that the authorities are overworked and have personnel shortages, but honestly, we have been almost a year after the European approval, so we'll hopefully get that Polish approval soon as well. In Italy, we had very good news during the quarter. They reached end of procedure, which is typically the biggest hurdle to get through, and so they've now entered the national phase back in April. That phase typically takes three months. With the summer, it might take a month or two more, so hopefully not too far away either, that approval. In the U.K., we unfortunately still don't have news from MHRA. They continue to be overburdened after Brexit and COVID. Usually, the process requires them to give companies a timeline. In our case, they told us that they cannot give us a timeline, so we continue to wait, and of course, follow up regularly. I find that a bit annoying, to be honest, because we had a fantastic NICE guidance in the U.K. back in January recommending inhaled sedation and also showing health economic benefits. We can't really fire on all cylinders in the U.K. yet, as the therapy is not yet approved. All we can say for now is that, of course, we continue to expect approval this year, hopefully sooner rather than later. Switzerland, as you might expect, is a bit more reliable. Swissmedic is expected to approve the product in the third quarter. Now with that, I'd like to hand it over to Peter to take us through the progress in the U.S. and some medical activities in Europe. Page 10, please. Thank you, Johannes. Thank you. If we are now on slide 10, please. In the U.S., we're on track with recruitment starting in both clinical trials. Throughout the end of the summer, the full list of study sites will be activated. As previously communicated, the two trials will randomize a total of 470 patients. For each study site, 300-500 patients will be enrolled and treated with isoflurane in an open-label design before the randomization phase. The primary endpoint is the proportion of time in target sedation range in absence of rescue sedation. Key second endpoints in the trials are changes in opioid requirements, time to wake up at end of treatment, cognitive recovery one hour after end of study sedation, and spontaneous breathing efforts. The primary endpoint and the clinical key second endpoints will be evaluated by blinded assessors. We move over to slide 11, please. This timeline shows the adult clinical studies that will be running until the second half of 2023, NDA submission in the first half of 2024, and ultimately U.S. launch in early 2025. Let's move over to next slide number 12. As part of the initiation of the trials, we had a well-visited INSPiRE-ICU Investigator meeting in San Francisco in May, and almost all study institutions were represented in person, and the remainder joined remotely. We had good interactions with the PIs, study coordinators, and with the contract research organization. We also had two European long-term users invited and were present to present their positive experiences of and the scientific rationale for inhaled sedation. Meetings also include hands-on demonstrations and sharing of first impressions, which were very positive from the first study sites. Overall, there's a lot of interest and willingness for these clinical researchers and key opinion leaders in the U.S. to get inhaled sedation approved and available for U.S. patients. With that, we move over to slide 13. The COVID situation has improved, has allowed for real meetings and congresses, which has allowed us to increase our presence and activities to convey our messages. We've had several face-to-face presentations with meetings in our direct markets, with more attending physicians and other healthcare professionals than we saw pre-COVID, which shows an increasing awareness and interest in inhaled sedation. Additionally, there's a growing interest in Latin America, which was illustrated by the attendance of over 600 unique individuals at an inhaled sedation webinar that Sedana Medical organized together with the Pan American and Iberian Federation of Critical Medicine and Intensive Care in May. Our autumn calendar is also very busy with planned live events in four continents. With that, I'd like to hand over to our CFO, I think, Johan Spetz. Slide 14. Yes. Thank you, Peter. Yes. Turning to slide 14, to take a look at our financial results for the second quarter. 2022, we have net sales, as Johannes has described, of SEK 27 million for the quarter, down from SEK 40 million in the same quarter of last year. Johannes has described the drivers behind that sales decline. If we turn to the gross profit, we report a gross profit of SEK 19 million for the quarter. That's down from SEK 26 million in the same quarter of last year. If we look at the gross margin, that comes in at 70%. That's up from 66% in the same period of last year. The improved margin, as Johannes also mentioned earlier, it's mainly driven by a positive product mix and price adjustments and also some initiatives to reduce freight costs that have been undertaken. We report EBITDA for the quarter of SEK -24 million. That's compared to SEK -14 million in the same period of 2021. If we look at OpEx, so that's selling, admin, and R&D costs, that amounts to SEK 46 million for the quarter. That's slightly higher than the first quarter this year and also the second quarter of last year. That slight increase is generally driven by a higher activity level in Q2 relative to earlier in the year. We are now, or as of the end of the second quarter, 98 colleagues at Sedana Medical. That's down from 107 at the start of the year. Next slide, please. Move to slide 15 for a look at our cash flow and cash balance. Cash flow from operations during the second quarter was SEK -39 million. Of this, 14 million is related to working capital, and that's primarily driven by increased inventory levels during the period. Cash flow from investments during the second quarter, also SEK -39 million. And if you have followed us, you know that that's investments related to our clinical studies and registration work in the U.S. and also the pediatric studies in Europe. Combined, we report cash flow for the period second quarter 2022 of SEK -75 million. Again, we have a strong cash balance of SEK 722 million at the end of Q2, and that's compared to SEK 779 million going into the quarter. Again, we expect to be fully financed until breakeven and through the U.S. launch phase based on the cash balance that we have today. Of course, the sales development so far this year has led us to look at our cost levels, and we have initiated a cost savings program, as Johannes also mentioned earlier. We are reviewing and reducing spending levels across mainly overhead and admin functions. Of course, we want to continue to invest in profitable growth initiatives, but we are looking at resetting the cost base going into 2023. As a reminder, we have no long-term debts in the company. Just a quick update also on our project to move the share from First North to the Nasdaq Main Market. This project is progressing according to plan. We are working towards having the up-listing completed before the end of the year. Turning to the next slide 16, for a quick look at our largest shareholders. This table shows the top 15 shareholders as of the end of Q2. It is nice to see that many of our top 15 shareholders have increased their holdings during the second quarter. Thank you for your continued support and for sharing the vision for Sedana Medical going forward. With that, I will turn the call back over to Johannes. Yeah. Thank you, Johan. That brings us to the end of our presentation already. The one thing I would like to leave you with, if we turn to page 17, the next slide, is a slide that I use quite a lot. I said in the very beginning that Sedana Medical is a very, very exciting case once we reach scale. In practice what that means is that we will have to become standard of care in as many intensive care units as possible. If you turn things around and imagine for a second that inhaled sedation was already the standard of care, so every hospital has used it for decades, all physicians and nurses are super comfortable with it, and then a new entrant comes to the market called propofol. What they can say is that propofol is not a better sedative. If you use it, your patients will need more opioids. You will see that they don't breathe spontaneously as much. They take longer to wake up, and the wake-up is less predictable. By the way, they will stay in your intensive care units for four days longer. Then how concerned would we be about propofol becoming the standard of care? That's our mission here. We are convinced inhaled sedation is the better option for ICU patients, and therefore also deserves to become standard of care. With that, I would like to thank you for spending the time with us on a very nice summer day, at least here in Stockholm. We'll open it up for questions. Thank you. We will now begin the question and answer session. To ask a question, you may press star then one on your telephone keypad. If you are using a speakerphone, please pick up your handset before pressing the keys. If at any time your question has been addressed and you would like to withdraw your question, please press star then two. At this time, we will pause momentarily to assemble our roster. The first question comes from Peter Östling with Pareto Securities. Please go ahead. Yes, thank you. I must say congrats on a very solid quarter especially. I'm once again very positively surprised about the strong gross margin and agree with you, Johannes, completely about what will happen when you get scale in the business. First off, just a humble request, it would be good if you could post the presentation ahead of the conference call because it's always significant lag from financial year-ends when it comes to flipping the slides. It would be very preferable and good if you could post the presentation ahead of the actual call. Thank you. Just then, looking at what you said. I have a couple of questions. I'll take them one by one. Spain, France, and U.K. performed well in the quarter, I guess, since you are still in negotiations regarding the drug that this was mainly the device that was sold in those markets. Can you just elaborate a little bit on what kind of feedback you get if they are extremely excited about this and just wait until the drug is approved to use the whole package, so to speak? That's my first question. Yes, sure. Thank you first of all for the hint with the presentation. We can of course do that going forward as we don't have a lag in the presentation. Thanks for letting us know. On Spain, France, U.K., the dynamics. First of all, you're exactly right. It's not just mostly the device, it's only the device that has been sold so far. We are seeing a very good momentum in actually all of these markets. It's almost a little bit of a buzz now that inhalation got approved in Europe and it's talked about at conferences much more. That of course for us is very good to see. What we're seeing in Spain specifically, which is one of the markets that is performing best these days, is indeed that we're making very good progress opening new accounts. We are working with accounts to increase the penetration. We have a very good team in place in Spain driving that. What gives me more hope is that we hear from quite a few customers that they're waiting a little bit until the pricing and reimbursement process is done to initiate inhalation in the hospital. We have a little bit of a queue of potential customers that are convinced of the concept, but for different reasons, like, hospital internal policies and formularies wanna wait for the final pricing reimbursement approval before going ahead. Even without those accounts, we've already seen a very nice growth versus last year, which in Spain was already a good year last year. I'm hoping with them getting the pricing and reimbursement approved in Spain towards probably the end of the year, and the launch maybe in the beginning of 2023, then we should see a further acceleration. That's a market I'm very happy about. Same goes for France, which is, compared to Spain, one where we've been around a little bit longer. We have a very good experienced team. A very active team also that continues to open a lot of new accounts. What's going to be very interesting in France is two things. One is this is where a lot of our investigator trial activities are ongoing. So they, the French customers are a little bit closer to the action from that perspective, and indeed inhalation is a good topic. The other interesting dynamic is now that we are almost ready to launch the drug Sedaconda isoflurane. France has historically been a sevoflurane market, so most of our customers have used sevoflurane with the device, which will be very interesting to see how that develops. It's a little bit of an advantage for us almost because sevoflurane has higher cost than isoflurane, quite significantly higher cost. So customers are a little less price sensitive when it comes to the gas, which should of course help us move more customers from sevo to iso. Then the U.K., we are also seeing very good growth. We could see even more growth, I'm convinced, if we finally got the MHRA approval, and we've discussed this a lot. Of course, that after Brexit, the U.K. Has decided to not be part of EMA anymore, follow their own process. What that has resulted in, unfortunately, is that these processes take much longer. Now, we are almost, I think after a year, we're still without approval. That's especially in the context as we said, having this fantastic NICE guidance and actually being ready to really fire from all cylinders, as you would say, in the U.K. That of course is a big milestone for us. If we get the approval, then of course that NICE guidance will help us even more. A good momentum in all of these three markets that you mentioned, and potential to further accelerate. Great. Then just two more questions before I get back into the queue. Can you talk a little bit more about what kind of price adjustments that you have made, the magnitude of them? Also when you say product mix, is it more the Sedaconda ACD and less accessories and or what is that entailing? Yes. The price adjustments, of course, I cannot give you kind of specific prices by country because, of course, they're also different by country and they're different by account. But what we have tried to do is to adjust prices upwards in the first half. That is of course one to compensate for raw material prices, but at least, as a general trend are going up. So far we've been able to fend that off a little bit. At the same time also, we've taken as a company a conscious decision to not raise prices during COVID because our products were in such high demand during that time that we felt like it was not ethical to try and benefit off of that. We didn't even have regular price increases in these years. We just kept the price completely flat. We compensated for that now that we are hopefully soon getting into more normal waters and took a slightly larger price increase in most countries in the second quarter. When it comes to the product mix, you're exactly right. We have the main device, the Sedaconda ACD, but there's also a bunch of different accessories. There's syringes, you need, there's different adapters. There's the FlurAbsorb kit, so the scavenging system. Of course, these products have different gross margins. Your suspicion that we've sold more ACD is to some extent correct because some of these accessories that we are selling are less innovative than our main product. Syringes you can also buy from other manufacturers. There's a bit more price pressure and therefore lower gross margins. When you see a positive impact on the gross margin from a product mix, then it's typically a sign that we've sold more ACDs proportionately. Just a quick follow-up before I get back into the queue. The very good gross margin in the quarter, is that something that we could all things equal expect for the rest of the year? Well, I don't hope that all things will be equal, because the sales should of course grow. Growing sales would then mean that the fixed cost allocations you have in the cost of goods would proportionately play less of a role. Yes, we have a long-term target definitely to see gross margins around 70%. Maybe a quarter here and there where we are below, there might be a quarter where we're a little bit above, but this quarter should not be an exception. Okay, sounds good. Thank you. I get back into the queue. Again, if you have a question, please press star then one. The next question comes from Mattias Wådsten with SEB. Please go ahead. Yes. Hi. Thanks for taking my questions. First thing I wonder is the reimbursement process proceeding according to plan, so to speak, or has it been even slower than what you believed when you revised the financial target in Europe or sort of earlier this year? What kind of insight can you have in sort of the progress in each country? To that also, what we see here in Spain are that customers are waiting for reimbursement coming in place and that there is sort of a pent-up demand. Would that also be true for France and the U.K. and other bigger countries as well? Thanks, Mattias for those questions. From a re-pricing reimbursement perspective, you're right. That was one of the reasons why we changed the guidance in the last report because some of these processes take quite a while. Now moving from a medical device company to a pharma company, it's important also for the company of course to realize that the approval date is not the same date that you can start selling, but there's actually a process in between. Now, how can we see progress and how does that compare to our expectations? Yes, things are progressing according to plan, at least the milestones that should have happened so far. Like for example, in France, the listing in the Journal officiel, like for example, the AMNOG process in Germany, proceeding with the IQWiG assessment and G-BA resolution, all of these things that we thought would happen have happened, and they also happened on time. At the same time, of course, when we changed the guidance, we already anticipated these processes would take some time. Sometimes there's a difference between what's stated in the textbook in terms of what you can expect in terms of months versus then what the experience and the reality. Of course, there's always some level of uncertainty if you're dealing with state authorities and the timelines. So far things are moving according to plan and all the milestones that we did expect by now are actually also materialized. Then your second question, are we expecting an acceleration of sales once we have all the approvals in place? The very short answer is yes. that you would of course also expect, because it just makes life much easier both for us, being able to more aggressively promote our products because we've left the off-label world behind and can now promote what is the only enhanced sedation therapy for ICU patients, ventilated ICU patients. That of course allows us to be a bit more upfront about promoting the benefits of the product. At the same time, it also makes it easier for customers because they don't have to deal with the off-label consequences either. That you put together with the customer feedback that we're getting, like as I said, for example, in France, where some hospitals are kind of in the starting blocks to get started once the approval is there. Yes, of course there's always some uncertainty related to looking into the future, but of course, the whole point of getting the approval in place and getting the pricing and reimbursement in place was to accelerate sales. That's very much what we're expecting. Appreciate the flavor there. Also, can you describe a little on how the market environment have changed between, I mean, let's say beginning Q2 and Q1 compared to the recent weeks here in terms of the number of ventilated patients and the overall issue with staffing shortages? Maybe also comment a little bit on the access to sort of hospital customers, how that has developed during the quarter. I'm guessing that's still tough in some parts of Germany or am I getting this wrong? Yeah. In terms of market dynamics, it's of course always difficult to see trends based on a few weeks. What we have seen in the first half overall, as I said, is a very significant decline of patients for different reasons that we have discussed. Very lately, so in the last couple of weeks, that has recovered a bit. You might have read in the news also with your question around the staff shortages in hospitals. That's, at least in Germany, hit the news quite a bit. That continues to be a problem. The capacity is still relatively low. That trend we continue to see. On the access question, it has gotten better. Compared to the waves that we've seen before, access is possible also in Germany. It is not what it used to be before COVID. Now you have to show a negative COVID test to get into an ICU, of course, from the same day. That has been the case throughout the whole pandemic. You are a little less likely to get in by just ringing the bell. At the same time, I feel like I know that several companies are still referring to access issues for explaining the performance. We are, I think, approaching a point where it's not really an excuse anymore. We do get to the customers that we need to get to, maybe not to the same level as before COVID, but we have to deal with it. It's very possible to work under the current circumstances. Perfect. That's leading a little bit into my next question. I mean, looking towards Q3, not expecting any precise prediction of course, but I mean, the market should not get worse at least, and you'll come even further in the launching key markets in Europe sequentially by then. Can you give some flavor around the potential to grow sort of organically in Q3 year-on-year? Or are there any particular sort of sequential seasonal effects that we should think of, in your view? That would be good to have some flavor. Yeah. That's, as you say yourself, it's of course a question that's a little bit impossible to give a definitive answer. That's I guess what everybody is tossing around that question, how will the world develop and when are we getting back to a new normal in ICUs. I'm a fan of being very focused on the things that we can control. And these are a little bit the things also that we presented today, some of these underlying indicators. So how many new accounts are we able to open? Are we able to grow penetration? So are we seeing a lesser decline versus last year than the patients have declined? Do we manage to keep our important customers on board? Do we grow penetration in these accounts? These are things that I can control and those of course, I'm very much expecting for us to make progress in the third quarter. Whether or not we will see organic growth versus this quarter or versus last year even, that very much depends on what you believe or how the market will develop. As I said, there's a little bit of a positive momentum now in early July from a just patient numbers perspective. Will that last? Who knows. I mean, the one thing about COVID is that it always surprised us. If you're asking us for our best bet, we're, I think, quite in line with most, what most companies have been saying that we see a recovery in the second half and then a more normal state in next year. That's also what most customers will tell you. But of course, that's something I cannot influence. We're really focused on what we can control. Perfect. Of course, I appreciate those underlying metrics that you showed with the penetration and so forth, but just the flavor was very appreciated. Thank you very much. Sure. We have a follow-up from Peter Östling from Pareto Securities. Please go ahead. Yes, thank you for taking my follow-ups. A couple of financial ones. Looking at cost, the selling expenses, for the first half, with all these conferences. I guess, with an anticipated busy second half, selling expenses will be approximately on the same level, and if you could talk a little bit about that. Also your cost-cutting program, I guess that admin expenses will probably trend down going forward. Thank you. Yes. Thank you, Peter. I can take that one. Yeah. On selling expenses, first off, yeah, we saw obviously in Q1 of this year, there was still quite a lot of pandemic restrictions around in Europe. Activity in terms of conferences and marketing events was slower than expected. Of course, that has changed recently. Of course, provided that we don't see another significant wave here after the summer for the pandemic, we expect sort of the Q1 level to be lower than the remainder of the year. In that sense, the activity level in Q2 is probably a better indication for the rest of the year than Q1 was. If we perhaps add a bit more flavor on what we're doing in terms of cost reduction. So far we have already spent less than budgeted this year. Some measures we have already taken, and you mentioned the admin costs as one area, and we were looking at other overhead costs as well. Now for the rest of the year, we are implementing further measures to reset the OpEx cost base to a new level going into 2023. There are some obvious examples here that we're looking at. We're looking at consultants and external vendors and things like that. Those are some of the things that are top of list. We are looking at admin costs more comprehensively as well, at the headquarters level in particular. Okay. Just finally, I noticed that you had a quite significant positive translation difference in your cash flow statement. Do you have all your cash in U.S. dollars or what is that coming from? Yes. We are buying dollars on a regular basis. Every second week, we are buying $1 million. So that the USD denominated part of our total cash balance is increasing, and it's currently around $20 million. The translation effect on that part, of course, of the cash position becomes more significant when translated into SEK as we report the cash balance, of course. Okay, great. Thank you. This concludes our question and answer session. I would like to turn the conference back over to Johannes Doll for any closing remarks. Yes, thank you very much. We received a few questions through the webcast, which I will go through before closing. This is from Emilie Da Silva from Eiffel Investment Group in Paris. Three questions. What was the level of sales related to COVID in 2021? That's a very relevant question, which I'll have to disappoint you and can't and won't answer, because of course, we don't know exactly which patients received our therapy in the end. Of course, what we did see in last year is that the share of COVID patients and the share of ventilated COVID patients was much, much, much higher than is the case this year. The sales decline that we're seeing this year is driven by so many different factors. COVID-19 is one of them, but at the same time, as we discussed, you have the decline in capacity in hospitals due to the staff shortage. You have less surgeries. You have less flu, less pneumonia because in many markets, people are still wearing face masks and working from home and so forth. We're seeing so much more than just a COVID effect in this first half year that it's difficult to justify or to quantify exactly how much that COVID effect is. What we do see, which I will stress again, is that from all the evidence that we have, the underlying penetration of enhanced sedation seems to point in the right direction. Second question: Could you comment pricing in the different countries Sedaconda has been approved? I assume that refers to the drug pricing. As before, we don't communicate exact prices. Just to give a little bit of a guidance, of course, we have run a clinical trial. We have shown clinical benefits over standard of care. We're the only isoflurane that is approved in ICUs. That, of course, also reflects in our pricing. While isoflurane is, of course, available for the operating theater as a off-label option from different manufacturers, you will see that our prices have a decent premium over those products. Third and last question. Now that you are approved in several countries in Europe, what is the next step? What would drive growth? What do you need? More salespeople, more events? Could you elaborate and share with us your expectations? Yes, as we said before, of course, the approval is a very big milestone, and it's a little bit the hunting license for us because now we are, as I said, leaving off-label territory. We can promote the drug and the device and the therapy as a whole more aggressively. Yes, I'm expecting that, of course, to lead to more growth. What are the best ways of driving growth? Of course, our field force out there, our key account managers will always be a very important channel because these are probably the most highest number of customer touch points that we have and that has turned out to be the most effective way for us to reach scale and to drive penetration in individual accounts. Because this is a therapy that requires quite a bit of service, quite a bit of training initially, and a lot of presence and being helpful. This is really where our field force stands out to provide that best possible service. That's a lot of the success behind Sedana Medical. I'm expecting that to stay the way. We are sufficiently staffed for now. I'm a big believer to invest in countries where you see momentum towards profitable growth that I'm very happy to expect. I'm not a fan of trying to fix lack of growth with more people. The mantra in our company is a little bit nail it before you scale it. We're very happy to invest in profitable growth once we see it, at least the trend towards it. Of course, we could also consider expanding a few teams in one country or the other, and be a bit more careful on countries where we don't see that yet. At the same time, we are, of course, having a range of marketing activities, conferences, webinars, peer-to-peer events and so forth. We're getting a bit more professional in terms of following those up and understanding a bit the return on investment. What the return on investment we get from, let's say, being at a conference and having a big booth versus, let's say, having a peer-to-peer event where we have a speaker talk to some doctor colleagues and in a more intimate setting. That's something that we are still in the learning phase, but it helps us inform to make smart decisions when it comes to marketing expense because, of course, we're not a big pharma company, not a big medical device company. We have to be very smart about where to put the investment. Good. I hope that answered those questions as well. Thank you very much again for spending the time with us today, and looking forward to keeping you updated on the progress. Have a nice summer, everybody. The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.