Hello, and welcome to the Life Sciences Investor Forum. On behalf of OTC Markets and our co-host, Zacks Small Cap Research, we're very pleased you joined us for the first presentation of the day from SeaStar Medical. Their session will be moderated by David Bautz, Senior Biotech Analyst with Zacks Small Cap Research. Please note you may submit questions for the presenter, and you may view a company's availability for one-on-one meetings by clicking Book a Meeting. At this point, I'm very pleased to welcome Eric Schlorff. He's the Chief Executive Officer of SeaStar Medical, which trades on Nasdaq under the symbol ICU. Welcome, Eric and David. Thank you very much. Thanks, John. Thanks for joining us today. You ready to dive in? Thank you for having me. Let's do it. All right. Your company, I think, takes kind of a unique approach to treating hyperinflammation in critical care. For those that are in the audience who may not be as familiar with the story, why don't we start with a high-level overview and maybe the clinical problems that you're trying to solve? Yeah. You know, SeaStar Medical is focused on treating these critically ill patients that face basically organ failure or potential loss of life due to this destructive hyperinflammation. You know, whether this is Acute Kidney Injury, cardiovascular disease, or surgical trauma, patients today have no FDA options to stop the destruction from the body's own out-of-control immune system. You know, SeaStar Medical, we have an FDA-approved product, which we can talk about, which is QUELIMMUNE for Children, and a pipeline of other potential products that the FDA has awarded Breakthrough Device designation for, which for the audience will help us speed up the potential path to approval for these therapies that treat these life-threatening conditions when no alternative treatments exist. Our opportunity is significant. The market opportunity is significant. The Selective Cytopheretic Device, or SCD, which we'll talk about, is a first-in-class therapy that has broad applications for patients suffering from acute kidney as well as chronic kidney diseases, as well as the serious cardiovascular diseases, as well as others, things around liver, as well as lung. You know, we estimate that there's approximately 1 million patients annually that are affected by conditions that SeaStar's SCD could address. Even capturing a modest percentage of this market would generate a significant revenue stream. You had asked a little bit about some of the clinical data, maybe how it works. You know, really what this is it's a disease-modifying therapy, and we call it really a therapeutic medical device because it's not a mechanical process. It's more of a therapeutic, much like a biologic or much like a drug. You know, what we've been able to show is that the SCD can actually neutralize overactive immune cells, specifically the most activated neutrophils and monocytes, which are the first responders and really are producing these inflammatory cytokines that wreak havoc in the bodies, the patients' bodies. We've been able to show through various clinical studies throughout the years of reducing mortality and decreasing dialysis dependency compared to historical measures. It really has been able to show that not only conceptually, you know, how the therapy works, conceptually works, but it also practically we've been able to show that through clinical studies. Yeah. Just a quick follow-up there. How do leukocytes have the potential to change outcomes in these critical illnesses? Say that again. I'm sorry. Specifically talking about how does targeting the activated leukocytes, which the SCD does, how does that have the potential to change outcomes in these illnesses? Let's maybe talk a little bit how we actually deliver the therapy today. If you think about a dialysis circuit, right? We're using a continuous one that's done in the intensive care units where the machines are already at. What happens is that we are a simple addition to an existing circuit that's already, you know, on the patient. The way that this works is through using an anticoagulant, which is called Regional Citrate Anticoagulation or RCA. The way that it actually does this is actually reduces calcium levels. Let's fast-forward. How is it that we do what we do? As the whole blood passes through, goes into the Selective Cytopheretic Device. The most activated neutrophil, the monocytes actually present themselves with more protein. The more angry or more activated they are, which are also the ones that are causing the cytokine storm, they actually have more proteins. Those proteins stick inside on the filter or on our SCD, and they inside that SCD in a low calcium environment, they're driven into apoptosis or cell death. They then shed their proteins and then go back into the body as a, like signaling that the storm is over. If you think about this, what we're really doing is we're telling the body that the storm is over, but doing it through a very much a feedback mechanism, much like, you know, any other drug works and, you know, those types of things. That's essentially how this is doing it, is that we're quelling the immune system very gently over time to allow the body to go back into normal homeostasis. All these diseases, you know, that we're- Okay, great. Next slide great. Next slide over. Yeah. All these diseases that we're targeting are where neutrophils and monocytes are a little bit out of whack. That's what's causing the cytokine storm. Okay. Let's kind of switch gears and talk a little bit about the clinical aspect here. We'll start with the pediatric indication. You guys have put out news recently on your pediatric registry along with publishing some results in pediatric patients. I was wondering if you could cover that area and kind of the key takeaways maybe that clinicians and investors should understand from that data. Yeah. Let's start with the registration study that we had done. That was a 22-patient study. We showed that normal historical control, these patients, it's a coin flip whether they live or die, unfortunately. These are children. What we were able to show in our clinical results is that not only did we improve survival by 50% to around 77%, but we also then had no patients on dialysis long term. Day 60, no patients were on dialysis. A huge win for patients, for families, for clinicians, but also for the overall healthcare system. Fast-forward to September of this last year, we announced the initial 21 patients on the SAVE Registry. SAVE is our post-market. It's basically a post-approval study that was mandated by the FDA as this falls under a Humanitarian Device Exemption due to the small patient population. What we showed in there, in that data was the same thing, which was confirming that the mortality as well as dialysis dependency was very consistent with what we saw in the registration study. That's a big win that really shows in the real world we're seeing the similar results of what we had showed in a clinical study to get the registration, the approval. This is really obviously important because actually these patients that these physicians and hospitals have been treating have been very sick. We've actually had numerous patients that have had oncology, you know, cancer. We've had others where they've literally had two or three transplant or kidney transplants already, and we're able to then help them bridge them back into no more dialysis. Then fast-forward, we had announced that in December of this last year that we were successful in negotiating with the FDA to reduce the number of patients required for the SAVE Registry, which was from 300 down to 50. At the time, we had announced that we were around 32 patients. We have announced here recently that we have achieved that 50-patient mark in the SAVE Registry, and so now it really comes down to waiting for a 28-day safety, and then we'll be submitting data to the FDA, you know, subsequently after that as we've finished collecting the data. It's really important to note that, you know, one of the things as you think about the cycle, the sales cycle, which is probably where a lot of, you know, the SAVE Registry is kinda hung up, because it's taken around eight months for us to actually get a site fully on or a customer fully on. We, you know, we hope and anticipate that this will actually cut that time down, assuming that, you know, that maybe the registry itself is optional or is taken away, and we'll have to see what the discussions are with the FDA. Okay. On the commercial side for the pediatric indication, you mentioned now that the SAVE Registry is kinda complete. Is that gonna be making onboarding at other pediatric centers easier? Maybe walk us through that. Yeah. We believe that there's an opportunity for that to be an easier process, a slower process. We go through the institutional review boards or institutional review boards, right, at each of the hospitals. They approve the HDE or the humanitarian device, and then they also approve the registry. Those are two different approvals within the hospital system. The HDE usually takes less time. You know, that's one that's on the path, right? You get that approved, and then the registry takes a little bit longer. We believe that there may be that opportunity definitely to be able to onboard customers much more quickly, and then obviously getting them to use the product in a much more effective manner as well. You know, that's really to be seen, but that really is of some of our hope is that we'll be able to actually cut down on the time needed to be able to bring these customers on and then for them to be able to use it in a much, you know, in the way that they wanna be able to use it. Okay. How many pediatric centers do you currently have the device in? What are your plans for expansion there? Yeah. Yeah. At the end of 2024, we had announced we had around two active customers. At the end of 2025, we had around 10 customers. That's what we've publicly disclosed. Our goal is to double that base by the end of this year. By the end of 2026 is to have that be doubled of where we were at. You know, it's also important for the audience to know that when you think about the market itself, there's only around 220 children's hospitals that are in the United States today where you know that are out there. Our real target is the top 50. If you think about this from a concentration standpoint, you know, 10 sites is really 20% of, you know, this target market of the top 50, which we believe is where half of the patients are residing today that would be eligible. All right. Sounds good. Let's turn to the adult program right now. You got the ongoing NEUTRALIZE-AKI trial. Why don't you just walk us through that, where that study stands right now, like what endpoints you're gonna be looking at, those type of things. Yeah. That is a randomized controlled study. It is a registration study. It's 339 patients. In December, I think we had announced we were around 40% enrolled, and we'll give some updates on our next quarterly call or next annual when we announce our year-end financials. We'll be giving the market an update on where we're at with that. This is a very important study as well. This is again looking at mortality rates. You know, again, historical controls have been around 50% mortality, so very, very much similar to for children. Then also dialysis dependency. This is a composite endpoint which will take both of those two components to show, you know, that the product is working as anticipated. That's what the basis of the study is. It's a 90-day look, so 90-day mortality and freedom from dialysis dependency. The other thing to note, that's really, you know, once we get fully enrolled, we get the final treatment in, we wait 90 days, and then at that point we can, you know, collate the rest of the data and then be able to get that data out from a top line probably within 45, 60 days after, you know, after that 90-day period. We have other endpoints within it as well as other subsets. You know, that's also really important to note, which is one of the subsets is sepsis. Septic population, obviously, sepsis is, you know, something that is eluded people for, you know, since the beginning of time as to how to actually address it. It turns out that, you know, we had anticipated about 50%-60% of the patients will be septic or have septic condition. I think that's gonna probably hold true through this study. We are also looking at another pre-specified around ARDS or acute respiratory distress syndrome. Obviously, when you think about the organs, the kidneys as well as the lung, as well as the heart are all kind of tied, right? They're kind of the triad of sorts. We're looking at that as well as one year basically readout of mortality as well, and other things. That's not part of it. It's not a requirement of getting it registered. What we wanted to be able to show is that it's durable, right? We already actually know that by definition, 90 days, if your kidneys have recovered, then you don't have CKD or Chronic Kidney Disease. That's actually the definition of Chronic Kidney Disease is 90 days. If they are dialysis independent, meaning they do not require it, then we know that there is no, it's not coming back, meaning, you know, there's no. It's because. Remember, this is not a lifelong therapy that people are taking. This is done over a usually 5-1 0-day period. That's why it's disease modifying. It really does fit the problem. At one year, we'll look at, you know, mortality rates, we'll look at subpopulations, et cetera. That really is the basis of the study. You know, the goal really is to have this study enrolled fully by the end of this year, by the end of 2026, which would then put top line sometime in, you know, the end of the first half of this next year. Okay. Assuming the trial is successful, what does the regulatory pathway look like to get approval in adults? Yeah. It's a medical device regulatory platform or pathway that we actually use what is called a PMA or Premarket Approval. You know, we're actually overseen by the Biologics Division of the FDA, which is a really important distinction, even though it's they have to follow the guidance of regulatory approval process. The goal is to be able to then submit the final kind of clinical data over the next year as we're finishing this enrollment and waiting for data readout. We'll be filing also what they call modular pieces. You can do these in modules. There's about four different modules with each of these PMAs. There's some things that you can get in beforehand for them, the FDA to review so that when we do get to the final data, it's not the entire voluminous, you know, amount of data, but it's actually a much smaller piece of data for the actual FDA to actually analyze and to move forward with. Okay. Before leaving the Acute Kidney Injury indication, we have a question from the audience. What other treatments or devices are hospitals using today for AKI? Basically, how is the SCD better for patients and for payers? Yeah. This is a great question. If you think about the standard of care today is what's known as continuous renal replacement therapy or CRRT. That is the way, and the way it works is just much like dialysis. You're trying to help the kidneys. It's a supportive care, so it's not disease modifying. It's literally trying to take toxins out to allow the kidneys to function, and you're hoping that the kidneys will kick back into gear and get that. Unfortunately, that the success rate is still been about 50%, right? 50% survivals or 50% mortality rate. That hasn't changed in like 20-30 years. You know, many of the academics have gone out and talked about do you do this earlier or later, all this. At the end of the day, it doesn't make a difference, meaning, you know, whether and when you do certain these types of therapies, the CRRT hasn't changed in 20-30 years. There's not been any step change. There isn't anything else that's out there today. You know, nothing that we see that's even, you know, kind of on the horizon, et cetera. That's really, you know, that from a payer standpoint in a hospital system, if you look at some of the healthcare economics data that we have for QUELIMMUNE for children, I think that probably illustrates what the value driver is within the hospital system. They go through a disease-related group, which is a DRG, which is about $400,000, right? When the hospital uses these, the QUELIMMUNE for six days at the price points, various price points, the hospitals actually make money. They're actually making between $40 thousand and $50 thousand per patient. How is that done? Well, it's done because we actually have shown that we can reduce through this analysis that we can reduce length of stay in the ICU by a few days, like three days, as well as reducing the mortality. All of those things contribute to the cost to the system. Now, I will tell you this doesn't even include the cost, the long-term cost to CMS and our healthcare system of not being on long-term dialysis, which we all know that that's, you know, an annuity stream of around $70,000-$100,000 a year. If you can eliminate the need for somebody to be on long-term dialysis, the cost savings to the system is huge. It's huge. Not, you know, and not just that, it's also that, you know, the kids and the adults are going home, and they don't require to go to a dialysis center every three days a week. Yeah, absolutely. Follow-up for the study, the NEUTRALIZE-AKI study is what results are you gonna consider a success? How is the trial going to be determined to be a success based on those primary endpoints that you got? Yeah. I mean, we, you know, we have a primary. The primary endpoint is improvement in survival, you know, and it's this composite of survival as well as dialysis dependency. That's what we have agreed with the FDA as to, you know, what does that need to look like, you know, from a pre-specified kind of going into it. Again, we need to be able to show that we can reduce mortality rate as well as the improvement in dialysis dependency. That's what success looks like. We may see success in subpopulations like sepsis or others. It'll be up really for when we get to that data analysis to really be able to show, you know, the broad nature of it. All right. Sounds good. Let's turn to future potential opportunities for the SCD. One of them I know you talked about is cardiorenal syndrome. What makes the SCD particularly well suited for that indication? Well, it's fascinating. What makes it really is neutrophils and monocytes in cardiorenal syndrome bridging to LVAD or transplant, guess what? A lot of problems that people have in that they're unable to be bridged to either LVAD or left ventricular assist devices or transplant is that they're too sick. They have too much inflammation. And so that's really what this is that what if you can actually reduce the amount of inflammation and let the body kind of go back into that reparative homeostasis to allow the patient the opportunity now and the providers in the healthcare system to be able to bridge that patient into an LVAD or to a transplant. I can tell you that we have a case study which we had done at the University of Michigan, which I think illustrates the point. It is that there was a 71-year-old male that at the time was trying to bridge to a transplant. They were too sick. They had too much inflammation. They tried to bridge him to an LVAD, same thing. We treated the patient for six days, for six hours a day. When they poured the elution out, so if you think about the device, right, the SCD, and they poured it out, it poured out like milk because there was so much inflammation in the patient. We successfully bridged that patient to an LVAD, and, you know, that's what success looks like for us, right, is to be able to do that. We are also conducting with one of our partners, a clinical study, which is a pilot study, which we believe could be a potential regulatory, study for another HDE in adults. This one is actually paid for by NIH, which is called NEUTRALIZE-CRS. All right. Sounds good. I do want to talk a little bit about financing for a couple of minutes. When you think about advancing the AKI program, commercializing in pediatrics, though, how should investors think about the company's capital needs and your financing strategy? Yeah. Let's start with what we have shared with the market. We shared that, you know, we will, in 2025, deliver a little over $1 million in revenue for QUELIMMUNE, right? This is really our first full year where that it's actually we'll be at north of 90% gross margin, right? The goal and what we've kind of told the market is that our goal really is to double that, this coming 2026. So think around, you know, doubling of the $1 million. So obviously that's one of the things we're pushing very hard on to be able to generate funds, obviously, to run the company. We had announced and shared with the market back in Q3, September, for September 30. In November, we had announced that we had around just over $13.5 million in cash. We're burning about $1 million - $1.3 million a month, which is kind of where you see that. We have access, you know, to things like ATM, which, you know, is uncommon for companies like us, as well as a $15 million equity line of credit that's out there that we can use as well. It's really a mix of things that we're using. One of the other things that's obviously out there is that we're in discussions with potential BD partners and all of those types of things to be able to also be able to bolster this. It's not just a need to raise money in more traditional ways, but what are the other ways that we can do this? Obviously, we've got plenty of opportunity. We've only focused on the United States today, but you could obviously see that there are opportunities outside of the United States, because inflammation doesn't have a boundary, right? They don't have boundaries. Geographic ones, that is. Right. Very true. A little bit about commercialization aspects. I got a question here. What education factor into the adoption of the device in different hospitals? What? Say that again. I was saying, how does physician education factor into the adoption of the device in Yeah In when you're going to new hospitals? Yeah. Yeah. I love this. That's a great question. There's a lot of education that comes in, but it's also there's a lot of peer education that comes in. Maybe I could walk people through, you know, how we have done this, which is the sites that we brought on, the customers that we brought on initially were customers. They really were the ones that had conducted the clinical study for children, right? They obviously became our first key opinion leaders that saw it firsthand. They became then obviously customers, right? If it works, they wanna become customers and make sure they have it in their hospital system. Our chief medical officer, Dr. Kevin Chung, every month holds a QUELIMMUNE users meeting. It's a user group, where, you know, it's really current customers as well as prospective customers. We have all of the folks, I think sometimes, you know, well over 80 to 90 people that are on some of these calls, where they're talking about current cases. Like what did they do? What was their criteria of why they put them on QUELIMMUNE? What was the outcome of it, and what did they learn? What that does is also builds a community, and that's really what the community has now embraced, is, "Hey, we can talk about these things, and this is maybe we should put them on earlier. Maybe that isn't a candidate." Maybe, you know, all of these types of things can then be discussed in a very open. We have peers that can talk about the processes like the IRB process within their own hospital in ways that they can also help others navigate within their own institutions. On top of that, with every site that we bring on, every new customer, we have a staff of ICU nurses that actually goes, trains the actual sites, the customers to get them up to speed. When the first patient is treated at that hospital, we fly that one of the nurses out and actually make sure, and they are there for that first patient. It becomes very important because we now are educating the customer on how the therapy is delivered, making sure I call it like a white glove service. You know, it's literally, we wanna make sure that they have the best first experience so that they understand exactly how to do the therapy, because if you don't do the therapy per the prescription, it's not going to have the same outcomes, clinical outcomes, which is that's just not acceptable. We have really put a lot around that piece of it to make sure that the customer has the most support that they ever feel like they have, they need. Yeah. Absolutely. That's good. I have time for another one here. What would you say are the top milestones that investors should look out for over the next, say, 12-24 months? Yeah. I mean, you know, it's for us, it's pretty clear, which is enrollment of NEUTRALIZE-AKI. So, you know, completing that enrollment, you know, kind of by the end of the year, this year. More customers within QUELIMMUNE. So, you know, doubling that customer base as well as, you know, tracking kind of the revenue as the revenue kind of moves from quarter- to- quarter, which you'll be able to see. We are also, you know, looking at enrolling and bringing on more sites for NEUTRALIZE-CRS, which is the other NIH kind of supported, think of this as non-dilutive. Then, you know, there's other things around regulatory, you know, for things, you know, where we maybe need to apply for things around, you know, for HDE type of application. Again, looking at ways to accelerate maybe potential approvals for indications that may not be large enough, but the patient population clearly has a huge need, and there's just no options out there for them today. All right. Sounds good. All right. Well, Eric, thank you for joining us today. This is a great overview. Well, thank you very much, David, and thank you for the conference for allowing us to kick this off.