Welcome to Sedana Q4 report 2022. For the first part of the conference call, the participants will be in listen only mode. During the questions and answer session, participants are able to ask questions by dialing star five on their telephone keypad. I will hand the conference over to CEO and President Johannes Doll. Please go ahead. Good afternoon. Welcome everybody to Sedana Medical's Q4 and full year report 2022. With me, I have Peter Sackhäll Let's start on page three, please, with the quarterly highlights. It is no secret at all that we are looking back on a year that has posed a number of challenges when it comes to the intensive care landscape coming out of the global COVID-19 pandemic with much less ventilated patients in ICUs, staff shortages in hospitals around the globe, and some remaining access restrictions in hospitals around the world. As in previous quarters, the impact of the sharp decline of patients compared to the extraordinary years 2020 and 2021 is also visible in our numbers in Q4. We have landed on 36 million SEK, a decline of 23% in Swedish krona. Of course, that kind of decline is not what you want to see from a growth company, it's worth highlighting that Q4 was actually our strongest quarter in 2022, and we feel that it's a very solid performance given the context. This is a result that makes me look very optimistically into 2023, when we will start comparing to less inflated sales levels. Gross margins has further improved to 72%, we still have a robust balance sheet with more than SEK 600 million in the bank, so we can execute on our plan without having to ask for new money, which in the current market environment is of course worth a lot. From an operational perspective, we have made some good progress in both Europe and the US. Sedaconda isoflurane, our pharmaceutical, is now approved in 17 out of 18 countries. We also see some progress on the pricing and reimbursement side that I will come back to. Fantastic news in the U.S., where FDA has granted us Fast Track designation, which we are obviously very excited about as it shows that FDA agrees with us that we are bringing an important therapy that should be accessible to patients sooner rather than later. In other news, we have completed the recruiting of our pediatric trial in Europe, which is an important milestone. We've also had the honor of ringing the opening bell at Nasdaq Stockholm, we are now officially a main market company. Let's look at page four, please, which helps put the 2022 sales performance into context. You see the sales development over the last couple of years. You see a steady growth on a lower level before COVID-19, sales doubled in 2020 and increased even further in 2021. Why was that? Of course, because ICUs were flooded with COVID-19 patients that needed to be ventilated. You see the reset in 2022 with sales that were, as I said, 23% lower than 2021. Still 71% higher than the last normal year, if you like, before COVID, 2019. It always helps to keep this through cycle view in mind to understand our performance. On page five, you see our 2022 sales split by quarter. You see that the winter quarters tend to be higher than the warmer summer quarters. That's normal and just a reflection of more patients with respiratory infections being in intensive care in the winter. Q1 2022 was still a little bit helped by COVID-19. We will see that in a second as the tail of the last real COVID-19 wave went into Q1 as well, but to a much lesser extent than the two previous years. Nevertheless, Q4 was our strongest quarter in the year, which I'm very happy about. On page six, you can see our regional breakdown. In all of our regions, we are comparing a very, very strong COVID-19 quarter, Q4 2021, with a quarter that in comparison had much less patients. For Germany, that meant a year-over-year decline of 30% in local currencies. Direct markets have reached the same level again despite the difficult comparator, which shows the good momentum we have, for example, in Spain. In the distributor markets, we still see what we've seen for a while, that we have high stock levels both at the distributor level and in the hospitals, especially in some countries in South America. Mexico, for example, that was one of our strongest contributors to our 2021 performance and has caused the, that decline now. On page seven, there are two big priorities for the company. One is to capitalize on our approval in Europe and double down on our commercial execution, so we work towards making in inhalation the standard of care. At the same time, the second priority, already preparing for hopefully our largest market of the future, the United States, where we're planning to launch in 2025 if all goes as planned. Let's start on the European side. On page eight, we see in graphs what I have already touched upon. Throughout the year, we saw much less ventilated patients in the ICU. These are numbers for Germany, as Germany is our largest market, but we saw similar developments across the board. If you have followed us for a while, you know that exact data on our addressable market, so ventilated and sedated patients in intensive care, are not publicly available. We do have though is the number of patients in high care and ECMO ICU beds. That's what you see on the left. These numbers are not perfect because all it shows is how many patients we had in ICU beds that would typically have a ventilator available. Of course, it doesn't tell us whether these patients were actually intubated and ventilated or not. On the right side, you see the number of ventilated COVID-19 patients. These are ventilated patients, but it does not show the full truth either, as we cannot see ventilated patients with diagnosis other than COVID-19. What you do see, however, is that the number of COVID-19 patients has declined a lot. You can see that the last real wave of COVID-19 was hitting the ICUs in Q4 of 2021, which is now the quarter we are comparing to in this report. You see that the tail of that wave ranges into Q1 2022, but then we had quite low COVID-19 levels in ICUs throughout the rest of the year. Okay. From what we know from previous quarters, the left side underestimates the decline in ventilated patients, and the right side overestimates the decline. The truth is between the 18 and the 61% decline that you see here. Based on our own studies we've run in previous quarters, probably somewhere in the range of 40%+ in terms of decline. On the next page, on page nine, we see the same data for Q4 in isolation. What you will see immediately is that the difference in COVID-19 patients is even more dramatic than the average for the year, minus 75% on an average day, which again shows the wave that we saw in 2021 but not in 2022. On page ten, you may have seen these statistics before. Again, a Germany example. German ICUs are reporting on a daily basis whether they operate under regular conditions or whether they have constraints, which in almost all cases means personnel shortages. In Q4, 70% of all ICUs reported restricted or partly restricted operations, showing how much of an issue this still is in the hospitals. Again, this is a German example, but we see the same problem across our markets. In the UK, for example, 40,000 nurses have left the NHS in 2022, that is from a situation that was already stretched to start with. Some estimates show a nurse gap of more than 100,000 nurses in the UK. On page 11, we have summarized what these trends mean for us. Less patients, the effect is quite obvious. Even though our penetration is going in the right direction, less patients means less devices sold, means less sales. The staff shortages also contribute to the lower number of patients as ICUs are running at a lower capacity, surgeries have to be postponed, et cetera. The staff shortages also mean that we have to fight a little harder to get customers to focus on a new therapy, because the human instinct when things are stretched is to stick with what you're used to and not necessarily switch to a new way of doing things. In many hospitals, this issue is not just about the number of nurses, but also about the quality. Since ICUs are desperately trying to fill the vacancies, there are quite a few nurses from normal wards working in intensive care now, who maybe don't have the proper education. A lot of nurses come from abroad with maybe different educational backgrounds, and also quite a few temp workers that are switching in between hospitals quite frequently. What that means for us is that we need to ensure even more training so the ICU teams feel fully comfortable using our therapy and also realize that it actually does make a nurse's life easier in a lot of cases to use our therapy. Not an easy environment to operate in, but I have to say, so far I feel that our teams are managing that situation very well. Just as an example, more training can also be a very good thing because it's much, much more time you get to spend with the full ICU team compared to a normal sales visit where you spend a few minutes with maybe only a few people. How will this market environment develop? We're staying consistent with what we have said before. We listen to our customers and continue to expect a gradual normalization in the number of patients in the ICU over the course of this year. While specifically the staff shortages are more tricky to resolve and will be with us for a little bit more time. Q1, as I said, last year, we still saw the tail of this last COVID wave. Just to illustrate yesterday, that's public data, in Germany, we had 242 COVID patients that needed to be ventilated. In all of Germany a year ago, that was still almost 1,200, so a factor of four or almost five. In general, looking at the year ahead, we will be up against much fairer comparators when it comes to our sales. On page 13, some good news on the regulatory side. We now have received 17 national approvals out of the 18 countries where we have applied. Poland and Italy were the two latest additions to this list. The one that we have now been waiting for for two years is the U.K. That is still outstanding. Here we see further delays. MHRA has now promised us an update in March. Let's hope that this time this is true. The delay is not because of us, but because of MHRA's continued excess workloads, but that at the end of the day, doesn't really help us. We are eagerly awaiting the approval because we are hoping to be able to capitalize even more on the great NICE guidance that we received more than a year ago in the UK, which recommends our products and shows a health economic saving for the hospital versus the previous standard of care. On page 14, as most of you know, regulatory approval is one step, but then there's also some pricing and reimbursement processes to go through that are quite different by country and quite different by length also in the different places. Here we've reached an important milestone in Germany, where we have now have finalized the so-called AMNOG process, meaning that we are done negotiating with the German payer association, the so called GKV-Spitzenverband. After one year of free pricing, we will now have a list price that is giving us the certainty that we can continue to operate in the same way in Germany. I won't disclose that list price because it's confidential, but I can say that I'm quite pleased with it, as it allows us to keep the same net price level to what our customers are paying today also going forward. In Spain, things are taking a bit longer. We had hoped for pricing and reimbursement approval in December but did not get it. We are now in active negotiations with the Ministry of Health. We're getting great support from some of the leading Spanish key opinion leaders that really push for inhaled sedation. We are also quite pleased to see that there are some new treatment recommendations by the Intensive Care Association for sedation of ventilated patients that now have inhaled sedation as a first-line recommendation for moderate and for severe sedation on the same level as propofol. That's very good news. We are hoping that all of this together will help to tick the pricing and reimbursement box reasonably soon. I should also mention that we are seeing very good momentum in the sales growth in Spain, even without that reimbursement approval. Of course, we'd like to get that stamp as well. In Italy, we actually had a quite unusual situation because we actually finalized the reimbursement discussions before we got the regulatory approvals. Now we have both already as our distributor that we've worked with for a number of years in Italy, quite successfully, will be able to launch as soon as we have the drug supply in place. With this, I will hand over to Peter, our Chief Medical Officer, who can take us through some of the great news from across the pond in the United States. Thank you. Yes. At the turn of the year, we received feedback from the FDA and were granted the Fast Track designation. That means that the FDA will give special attention to our clinical development program and confirms their view that inhaled sedation may potentially meet an unmet need when it comes to sedation of critically ill ICU patients. The implications of this are that the FDA will make themselves more available for frequent communication throughout the development process. Potentially, there may be a room for accelerated approval prior to review and/or a rolling review, and this is yet to be agreed with the FDA. If we move to the next slide 16. The two clinical trials that are... form the base for our FDA NDA application are two phase three studies, assessor-blinded studies, to confirm the efficacy and safety of inhaled sedation delivered via Sedaconda ACD and compared with propofol. These two studies include 235 patients each in approximately 25 sites. The primary endpoint is similar to our European study and the portion of time in sedation target range of RASS minus one to minus four. Key secondary endpoints include opioid use, wake up time, cognitive recovery at the end of treatment, and spontaneous breathing. These studies, we go to slide 17. These studies were initiated with first patients in April and in June respectively, and anticipated to be ended by the end of this year. We currently have almost 20 study sites up and running and a few more pending. Given that we can keep this timeline, we would be able to submit our NDA application early next year with an approval at the end of the year and a US launch in 2025. If we move to slide 18. Looking at the major investigator-initiated trials where we have some degree of involvement. We have the INNOSED study in France. That's a study comparing isoflurane with propofol for up to two weeks, comparing acute cognitive dysfunction and long-term cognitive function in 250 patients in total. To date, 136 patients have been enrolled in this trial. We have the CESAR study, sufentanil in ARDS. This is a study of 700 patients randomized to sufentanil or propofol, one to one, in patients with ARDS, also in France. This study is moving closer to full enrollment. Currently, they have 616 patients enrolled. They anticipate to have enrolled all patients by the end of this year. Finally, we have the ISCA study, the inhaled sedation COVID ARDS study. That was a retrospective study of almost 200 patients with COVID ARDS. This study was completed and was recently published in the Journal of Clinical Medicine. The findings in this study were that use of inhaled sedation for 24 hours or longer in these patients was not associated with any difference in clinical outcomes compared to IV sedation. The authors did conclude that inhaled sedation was feasible and safe, while reducing requirements for other sensitive agents. Let's move to slide 19. As Johannes mentioned, we completed our pediatric study, IsoConfort study, also at the end of or the beginning of this year, actually, it was. This is a study that we have been required to perform to secure data exclusivity and market protection for our orphan indication. That's one of the reasons why the study is being done. Secondly, and maybe more importantly, I would say in the short term, is that if the study is successful, we'll be able to get a market authorization for pediatric use. We expect to be able to present the high-level results from the IsoConfort study in Q2 of this year. Assuming positive results, we anticipate to get an approval in Europe in Q1 2024. The data exclusivity that I mentioned is until 2031. That's independent of whether or not we meet our primary endpoint in the trial. The prerequisite for that is that we fulfill our commitment to perform the clinical trial in children. Moving to slide 20. We have increased our activity out there, not only among customers, but also on various congresses across the globe. We've been present in four continents with both symposia, webinars, our own organized meetings and face to face meetings with our booths in numerous congresses with high attendance generally. Okay, higher than pre-COVID. We move over to slide 21, and I pass the floor over to you, Johan Spetz, CFO. Thank you, Peter. If we turn to our financial results in Q4 2022 in a bit more detail. As Johannes already mentioned, we report net sales for the quarter of SEK 36 million. That's down from SEK 46 million in Q4 of 2021. Constituting a decline of 23%, or 28% in fixed currencies. Johannes has already discussed the main drivers behind this. It's mainly decline in Germany and due to fewer ventilated ICU patients where we saw Q4 of 2021 being one of the last quarters where we had significant numbers of ventilated COVID-19 patients in ICUs in Germany and in most of our major markets. More flattish sales development in other direct markets despite similar market headwinds. Again, as Johannes mentioned, Spain is one country where we see good growth momentum compensating for some of those market headwinds. If we turn to gross profit, we report for the fourth quarter 2022, a gross profit of SEK 26 million, which equates to a gross margin of 72%. That's up from 71% in the same quarter in 2021. The improved gross margin is mainly an effect of price adjustments that we've done during the year and also lower freight costs. EBITDA for the quarter, we report minus SEK 18 million. That can be compared to minus SEK 13 million in Q4 2021. If we look at OpEx, so total OpEx, combining selling, admin, R&D, and other, that came in at SEK 49 million in Q4 2022, which is lower than the same period of 2021. We can also point out that in Q4 of 2022, we had some costs related to our Nasdaq uplisting project, which is then of non-recurring nature, which accounted for SEK 4 million out of those 49 million in total for the quarter. We are seeing that the cost efficiency measures that we have put in place and are continuing to put in place also going forward are starting to have an effect. Some of the things that we've done already is that we've worked on streamlining some administrative functions such as HR, investor relations, accounting, controlling. We've also tried to reduce external spending on consultants, other external vendors, and also conference sponsorships. We are taking measures to reduce our underlying cost base, in particular, at the headquarter. Of course, we want to continue to invest in growth and spend money on growing. We are seeing that we have additional streamlining initiatives that we can pursue during 2023. If we look at the number of staff at Sedana Medical today, we are 95 people, and that is down from 107 at the end of 2021. That's including both employees and consultants. If we move to the next slide, to look at our cash flow and cash balance. Cash flow from operations in the fourth quarter was minus SEK 23 million, of which cash flow from working capital accounted for minus SEK 14 million, and that's mainly related to negative cash flow from short-term liabilities or accrued expenses, to be precise. A reversal effect from what we saw in Q3 of 2022. Cash flow from investments during the quarter, minus SEK 27 million, it's related to our clinical studies and registration work in the United States as well as the pediatric study in Europe. For total cash flow for the period of -51 million SEK, taking us to a cash balance at year-end of 608 million SEK. That's compared to 676 at the beginning of the quarter. That change in the cash balance, of course, also includes an FX effect. We still have an ample cash position at Sedana Medical. We are, of course, managing this liquidity in various ways, both when it comes to the currency exposure. We have converted roughly half of our cash into US dollars. Of course, going forward, a lot of our expenses will be in US dollars. We've also placed approximately half of our cash, total cash position in longer term deposits for better interest rates, both SEK and USD cash holdings that we've placed in those type of longer term deposits. As Johannes mentioned already, we expect with this cash position that we have to be fully financed until breakeven and to be able to execute on our strategic plans that we have. As a reminder, we have no long term debts in the company. As a final note on this slide, in January, we successfully moved to the Nasdaq main list here in Stockholm. Just want to take this opportunity as well to thank the whole team that was involved in achieving this milestone for Sedana Medical. If we turn to the next slide 23, and this is our current largest shareholder or largest shareholders as of December 31, 2022. Not that much in terms of movements during the fourth quarter. But of course, we want to thank our shareholders for the trust and continued support as we move into 2023. So with that, I will hand the call back to Johannes. Yes. Thank you very much, Peter and Johan. Let's move to our last slide, page 24. Please, I hope we could bring across that we've made some progress in the quarter and have made a solid step forward in our journey. Before we close, let's take a quick step back from all the information that we have thrown at you and remind ourselves what Sedana Medical is about from an investment perspective. We continue to see good growth margins of 70% and up. By definition, we can become quite profitable as a business when we reach scale. We already have proof of concept for that in our main market in Germany, where the majority of intensive care units are already our customers today, and where the local team is generating attractive EBITDA margins on a local level. It can be done. The question is really can we reach enough scale? Here we have convincing clinical data on our side showing that patients really benefit from enhanced sedation, which is important as only good medicine will turn into a good business eventually. That is what it should be, at least. Equally important in today's healthcare systems, we can also show that hospitals save money with enhanced sedation versus the previous standard of care. We have lots of places to grow and to create new Germanies, if you like. Again, regulatory approval in 17 countries in Europe, hopefully soon 18 when the U.S., when the U.K. comes around. The largest commercial opportunity in the U.S. is still untapped with FDA giving us an extra motivational boost, as we have heard with the Fast Track designation. Let's not forget, very important these days, a strong balance sheet and the commitment to keep working on the OpEx side so to get closer and closer to profitability outside the U.S. That concludes our presentation. Thank you very much for listening, and we will be very happy to take your questions. If you wish to ask a question, please dial star five on your telephone keypad to enter the queue. If you wish to withdraw your question, please dial star five again on your telephone keypad. The next question comes from Mattias Vadsten from SEB. Please go ahead. Hi. A few questions from me today. I mean, it's reassuring to see the growth rate is, you know, putting it into perspective to the quarters in 2019 coming up here in Q4 versus prior in the year. You also show quite impressive development quarter-over-quarter, in my opinion. Also here, while comparing the sort of sequential development into Q4 we have seen in the past in the company. Could you describe what improved into Q4 other than sort of seasonal patterns? It looks like the majority of improvements come from Germany, so maybe start there. Yes. Thank you, Matthias. Well, let me first say, of course, that throughout 2022, a lot of things have happened that were a little on the executional side, that were a little bit hidden under the relatively negative sales development, which in turn was driven by the external market factors. For the last, yeah, almost 18 months, we have put a lot more focus on commercial execution. We have run field force effectiveness, programs. We've looked into how can we spend even more time with our customers, how can we use that time in the most efficient way, how can we make sure we spend our time where the potential sits in large potential accounts and so forth, and try to be as impactful as we can be with our, with our troops out there, our key account managers out there, to convince as many clinics as possible to use enhanced sedation more than intravenous sedation. The most important indicator here is basically the penetration of the whole market. That has been going up throughout the year. We are seeing impact of our work here. Yes, in Germany we see good developments, but also in some of our other direct markets. Spain is one that I've highlighted a few times in the presentation, but also in Spain and UK things are going in the right direction. What we're seeing and what we hopefully will be seeing more of when the market headwinds become a bit lighter and eventually we enter a new normal is the impact of the very execution-focused work that we have done and the increasing customer focus and commercial orientation of the whole company. Very good flavor. Would you say that, you know, the new customer inflow that you have reported previously, has that come up or to the same level still, or how do you- We've seen a reasonably stable level throughout the year. We've communicated a number previously of three new accounts per week in Sedaconda. It's a little different by country. In Germany, the majority of ICUs use our products already. We are still opening new accounts. Of course, proportionately, more growth has to come from making sure the penetration in existing accounts goes up. They use inhaled sedation, ideally as the standard of care, or at least in as many patients as possible. In other markets where we are still getting started on a lower level, still sales wise, of course, the importance of opening new accounts and opening the right new accounts in accounts where we see good potential is of course proportionately more important still. That's why, that's why the, this number of 3 new accounts a week is one that we're quite happy with. It's also worth mentioning that there's a lot of work that goes into opening an account. We don't sell a therapy where we hand over a user manual, and then the customers will just start using. There's a lot of training involved, training with the full ICU staff. You need to get the doctors involved. You need to make sure the processes work in the ICU. All nurses need to be trained and so forth. It's a lot of work going into this. We see a huge difference in the later pickup, depending on how much work we have put up front. If you don't put that time up front, you will maybe see a little bit of sporadic use. The accounts where we are really successful, those are the ones where from the start we've really invested in working hand in hand very closely with the ICU teams. Sounds good. The next one would be on a 2025 target, if I may. I mean, let's say you grow 25% per year in Germany and make some SEK 50 million in distributor markets by 2025. It seems you know, you need to more than double sales in other direct markets each year. You know, how to think about this year, I mean, in terms of Q on Q improvement in other direct markets, you are now, you know, the therapy is approved in more important countries, of course, with hopefully UK coming on soon as well. We know this, but could you just help us understand sort of the path here if you will be back-end loaded or, you know, how should we think about that? Yes. I mean, of course, you're exactly right in saying it's a steep mountain we have to climb, especially, and the mountain looks even steeper now that we've gone a little bit into a valley in 2022 coming out of COVID-19. Of course, what that year has hidden a little bit is the underlying momentum, which is looking positive. Hopefully that will become more visible as we move forward. We also have to accelerate further. That's very clear. What we will need to see in more markets is inflection points in the sales curve. In Germany, if you look back in history, at some point, helped by the treatment guidelines and helped by enough customers using the therapy, all of a sudden the growth accelerates when it becomes a topic at conferences, when physicians speak peer to peer, when all nurses kind of get used to it, then all of a sudden you see a faster growth. We are, I think, pretty much there in Spain. We see very good growth in Spain. We are hopefully close to seeing an inflection point like this also in France and in the UK, as I've mentioned, once we get the MHRA approval, I'm hoping for some acceleration as well because we had this very, very positive NICE guidance a little more than a year ago, and we are still in this slightly absurd situation where NICE is recommending a treatment that is not MHRA approved, which is quite rare, I guess, to happen. Once the full therapy is approved, we can actively promote it and hospitals can feel more secure about using something that is on label approved and so forth. Then that should accelerate the pickup as well. In terms of what the shape of the curve looks like, you're probably right, that, and the, it's a little bit back-end heavy, because some of these inflection points will come over time. Good. The last one, you know, with the FDA Fast Track designation in the U.S., as you mentioned, the expected timeline until approval and so on is left unchanged. We know that. My question is really, are there any other sort of readouts or potential news flow, like early data that we can expect over the year? Yeah, in the U.S., do we have to wait until the end of the year for the next sort of news relating to the U.S.? Okay. So to speak. That's- Maybe a difficult question, but anyway. Sounds like it's difficult for you to be patient on this one. Yes, so when it comes to the Fast Track, generally, my recommendation is always to have an extremely humble approach towards FDA. Because, of course, we can be self-confident, and we have a great therapy that we're bringing, that's bringing a lot of value to patients. At the end of the day, it's the FDA that decides. And the possibilities for a company to influence the decision-making is limited, I would say. Of course, you have to bring forward the best arguments. At the end, it's the FDA that decides. That's why we've been a bit cautious in now creating too many hopes of what the Fast Track designation would mean because the FDA is very careful in not making any commitments. There are a number of things that Peter has talked about, like the rolling review, potential closer interaction, potential accelerated review, priority review, and so forth that could mean an acceleration, but none of this is guaranteed. That's why we have not changed the guidance on the timeline because it's not certain that it will result in an acceleration. In terms of milestones, we will continue to report on progress, whether we're on track or not on track, with the recruiting, because that's, of course, a big driver of the timeline as well, if we manage to recruit our patients on time. The next big milestone is indeed going to be the completion of patient recruitment. After that, we will of course submit to the FDA, which will be communicated around. Also, there's probably going to be a communication around top-line data as we have had it for the European trial as well. But in the meantime, you'll have to be a little bit patient on more news on the U.S. Perfectly clear. Thank you very much for today. Thank you. The next question comes from Peter Östling from Pareto Securities AB. Please go ahead. Can you hear me okay? Yes, loud and clear. Yes. Great. First, congrats for a very solid ending to 2022. It's always very interesting to see the market reactions when the news agencies put out the initial headline, "Sales down 30%, increased loss." I congrat to all the investors that bought when the share was down 5%. They have now made about 15% return so far today. With that statement, I have a quite a number of questions, and I think I will start at the end of your presentation with some financial questions. Can you say anything about if you see the... If you adjust for the SEK 4 million that was considered one off and take the total OpEx for Q4, is that a good proxy to use when forecasting OpEx in 2023? Should we expect that you start to maybe build some more traction in the U.S. that will increase OpEx a bit in 2023? That's my first question. I can take that one. I think for the countries that we have in the company today, that is a reasonable level of OpEx. As you point out, we have the U.S. coming up, and we will, of course, build our own, as we've communicated in the past. We will build our own organization in the U.S. That will start to happen slowly and gradually during 2023. You will see some of that coming in. On the other hand, we have some other cost efficiency initiatives that we intend to pursue during the year. That will have an offsetting effect there. As you know, we're not guiding firmly on any OpEx numbers for the full year. Hopefully, that gives you some indication. Yeah, great. Thank you. Can you say anything about cost increases in general, wages, et cetera, during 2023? If your efficiency measures will mitigate some of that. That is definitely our ambition. Of course, we are seeing the inflationary trends that all companies see these days. So far, as you can see, both in our gross margin and also our OpEx, we've been able to mitigate that in a number of different ways. Of course, foreign ambition to continue to do that. Hopefully we'll be able to keep those pressures under control during 2023. Great. Just, alluding a little bit on gross margins, do you expect them to stabilize around 71%, 72% for 2023? Will they fluctuate, with maybe with volumes during the year? Yeah, there we have our standard guidance of 70% gross margin. Of course, we are on a good trend now, but as you pointed out, there are inflationary pressures around us and out in the world. That's probably reasonable to stick to that guidance. Hopefully, we will aim to beat it and continue on the current trend. That remains to be seen how it plays out here macroeconomically in 2023. Okay. Moving over to, maybe Peter Sackhäll. In the U.S. trials, can you say anything on how many patients that you have recruited? Maybe if you can say anything about how many clinics are now past the run-in patient level and actually recruiting real patients. If that's all of those 20 clinics that are up and running, Are they recruiting real patients or are some of those still having run-in patients? Yeah. I can say there's a handful that are still on the run-in, but the majority are currently enrolling randomized patients. When it comes to the patient numbers, we normally will not communicate on that. But we are seeing some good momentum, I would say. Okay, great. Would you have to remind me about the 130 run-in patients, will they be included in the statistical analysis or not? The run-in patients will not be included in comparison. They are merely for training, but they are also contributing to our safety database 'cause they're being exposed to isoflurane. All of them are receiving isoflurane, and we are collecting all relevant safety study data on those patients. Okay. Can you say anything about if you have seen any kind of hiccups when using this new therapy for the U.S. market? Or if those potential hiccups has been taken care of with the run-in patients and when you start to recruit real patients, every... It gets more smoothly with the healthcare stuff. U.S., of course, is a new ICU environment for us as a company. I would say we've been very successful in the run-in phase in all our clinics. It's been a very good experience both for us as a company and also for our study sites. The PIs and the study teams have been not only able to learn how to master the therapy but also had the opportunity to see some of the benefits in an open label fashion. That's created a lot of enthusiasm and incentivized, I would say, the study sites. Okay. I noticed that you mentioned on one slide that the CESAR study has now recruited 616 patients. I was just wondering what happened to the interim analysis of the 350 that was announced about two years ago, I think. Yeah. Yeah. One and a half year. Yes. This was a process that has taken significantly longer time than anticipated, and it was actually meant to be a readout for futility. They are now very close to completing the study and have still not got the final data for that. Okay. That analysis could come any day now. I don't have any input on when it would come. I have the impression because this is not our study as you know. We communicate with the study, the lead investigator in the study. I have, sounds very vague, but I have the clear impression that they're not really hoping. They're not waiting for the interim analysis as such. They're just recruiting until the study will be over. If they were to find that this was, there was any safety issue, they would. They have this data safety monitoring board, there's been no issue there. It's very unlikely in my view that the study will be halted based on those results. What? I didn't get the last. Do you expect the study to be halted after the interim analysis? No. No. No, I don't expect it. Okay. Okay. Okay. I wouldn't expect it to be. I don't think the data itself expects it to be. Okay. Over to some reimbursement issues. Spain, firstly. Can you say anything or allude anything about what the main issues were behind the reason to postpone a decision in December? Do they need more information or what was their response? Yeah. The pricing reimbursement process in Spain is a little bit unique. There's a number of steps to go through, and it's as of course, you know, it's one of the ones in Europe that take the longest. I just saw a statistic that between submitting the pricing and reimbursement dossier and approval of the pricing and reimbursement status in Spain, the average is 400 days. Compared to that, we're still doing pretty well because of the past last summer. Now, as we have also communicated, we were hoping to get a positive approval already before Christmas. We were probably a bit too optimistic there. We didn't get that approval before Christmas. We didn't get a formal rejection either. It's not that. That's a step forward in the process. We're now, we have a contact person in the Ministry of Health that we can talk with and negotiate with. Part of that negotiation is around the price, of course, because then the objective for the system is to make sure that the new therapies that come to market are not too expensive and don't blow up the budget. There's also a discussion around how urgently is inhalation needed. This is one that I think we can bring very, very good arguments because from both of the big associations in Spain and the physiologists and intensivists being the more important one. We have very, very good key opinion leaders that are writing letters supporting the introduction of inhalation and providing good argument as to the clinical need for these two things, clinical need and the money. The process going forward is, we are fine-tuning our dossier, what value dossier that we've submitted, making a few adjustments to that, adding the opinion leader letters to that. At the end of the day, all the regions in Spain will vote whether or not they want that product reimbursed in their respective region, and it needs to be a unanimous vote. So you need all the regions to vote in favor. As you can already hear from my description, it's a slightly longer process, but we're hoping that these regions will vote somewhere in the second quarter. Hopefully we'll have that pricing and reimbursement approval. Of course, there's always some uncertainty as for all these processes, but I think the arguments that we can bring forward are. Well, not that I'm neutral, but I find them very convincing. As we said before, it's not been a true barrier to the success in the market in Spain. We do see very, very good adoption. It's the fastest-growing market right now. Of course, it would be nice to see that further accelerate as we get the pricing and reimbursements approved. Yeah. I mean, the fact that Spain is one of the fastest-growing markets, how is that input affecting the authorities? It's, well, it's helping in the sense that the clinical needs becomes a bit more obvious. Now, of course, it's a number of regions in Spain, not all the regions see the same kind of pickups because, of course, we have a pretty focused approach and focusing on the larger cities. There are regions where inhalation does not play a big role. But overall it's a positive that there seems to be a market demand because of course also the health system, well, one aim is to save money, but the other aim is of course also to provide good care. You can't really withhold therapies where there's a clear need because it's better for patients. You cannot withhold that from patients. Without talking about absolute values, can you say anything about the relative or reimbursement levels between, for instance, Germany and Italy and the price that you're asking for in Spain? No, I can't really talk about it. Brief answer. Of course, I mean, every process is unique. The circumstances are unique also, how competitors are priced, how propofol is priced, how midazolam is priced, how off-label isoflurane or sevoflurane are priced. There's a number of factors playing into that. Since European countries have become more effective at looking at each other, in terms of reimbursement prices, of course, I will not make any statements around the relative or absolute values in specific countries. Okay, just a last question before I go back into the queue. I noticed that the number of ICU patients in Germany declined by 18%, but your sales in Germany declined by 30%, and still you say that you have good momentum behind the scenes, so to speak. How should we interpret the different values here? Yes. that's a good question. I was trying to explain that on that one slide. Yeah. You said that. Oh that the one underestimated and the overestimated. Exactly. The number of ICU patients, that number has declined 18%. Exactly right. Those patients are patients in the ICU, irrespective of whether they are intubated and ventilated or not. When we did our studies previously, usually more than half of these patients are not ventilated. Between these two values, -18% for the ICU patients overall, and -61% for ventilated COVID patients, which again, is not all patients because there's only COVID patients in there. The real decline of intubated and ventilated patients is usually somewhere in the middle. You remember we made the study, where we actually looked at that and made a survey among intensive care units in Germany, there we found a re-reduction between 40% and 50%. Right in between these two values. That's where, without having the hard data, that's where we estimate that the decline really hits. The decline in ICU patients is underestimating the decline in intubated patients. The reason behind that is, well, there's a number of reasons, but if you have low-- and of course, it shouldn't be that way, but it's still a fact in clinical practice. If you have low capacity utilization in an ICU, so you have a lot of empty beds, then you tend to get patients into the ICU that are less severe, and those are less likely to be ventilated. That's why these numbers don't fully correlate with our sales development. Okay. Understood. Thank you, guys. Once again, Congrats to a very strong quarter. Thank you very much, Peter. The next question comes from Joseph Hales from Rx Securities. Please go ahead. Good afternoon. Thanks for taking my questions. Can you hear me okay? Yes. Hi. I just wanted to ask one on the 2025 revenue guidance and some of the assumptions baked into that. It seems to me that a couple of the bigger challenges that's, that are persisting are access to hospitals to really push the product, as a hangover from COVID, and staff shortages. Unfortunately both issues which are beyond control. Beyond your control. I was just interested to know what kind of assumptions on relief of those two problems is baked into your 2025 revenue guidance, or is that guidance made on a kind of maintenance of the status quo as is at the moment? Yeah. There is, of course it's true that our addressable market is ventilated and sedated patients in the ICU. There's a number of factors that are affecting that number. There's a seasonality, there's whether or not flu seasons are mild or severe. There's the whole COVID issue and the implications from that. There's staff shortages, there's access to hospitals, et cetera. A lot of these things as you rightly say, is beyond our control. It's also in the long term, not going to be so important whether an individual flu season will be more severe or more mild, or whether in a particular quarter the access to a hospital was more or less, less difficult. It's true that over the last, yeah, probably 18 months or so, and especially also during COVID and then the following year, there's a number of very special effects in the market that have made our life easier, and we would need some of them to relieve a bit in order to see the full growth potential that we see that we have. From an executional perspective, we are of course very much focused on what we have under control. That is making sure that every patient that is ventilated in the ICU has an as high as possible chance of receiving inhaled sedation. As long as that indicator, so the penetration of all patients goes in the wrong direction, then we can live with kind of the fluctuation in the size of the market segment. Because over time, that will equal out. Of course, for the SEK 500 million target, it will help if things come a bit more to normal, both in the number of patients, and also in terms of staff shortages that they have in the hospital. Okay. That's great. Thanks very much. There are no more questions at this time. I hand the conference back to the speakers for any closing comments. Yes. Thank you very much. Thanks a lot for listening. Thanks a lot for the discussion and the good questions. I'm wishing you a nice afternoon. This concludes the call. You may now disconnect.