Cytosorbents Corporation (CTSO) Earnings Call Transcript & Summary

Good afternoon. Thank you for coming to the 2021 Virtual UBS Global Healthcare Conference. My name is Tim. I'm happy to be your host for this session. Our next presenter will be Dr. Phillip Chan from CytoSorbents. Q&A session will follow immediately after the presentation. [Operator Instructions] We now turn it over to Dr. Chan. Thank you.

Thank you very much, Tim, and thank you very much for the invitation to be here today. It's a pleasure to introduce the CytoSorbents story to new investors. If you can follow along with the presentation, let's go Slide 2. As a publicly traded company, please let me remind you of our safe harbor statement for forward-looking statements. On Slide 3. CytoSorbents is leading the prevention or treatment of life-threatening inflammation, cytokine storm and other deadly conditions in the ICU and cardiac surgery using our CytoSorb blood purification technology. On the next slide. CytoSorbents is a rapidly growing, international, NASDAQ-traded medical device company with approximately 200 employees, $41.3 million in trailing 12-month sales and $68.5 million in cash as of the end of the first quarter. CytoSorb is EU approved and commercialized in 68 countries around the world as an extracorporeal cytokine adsorber to help treat deadly inflammation where cytokines are elevated, often called a cytokine storm. Overall, we've shipped more than 131,000 devices to date. We've also treated more than 5,750 COVID-19 patients across 30 countries, including in the U.S. under FDA Emergency Use Authorization for use in critically ill COVID-19 patients with respiratory failure. CytoSorb is also EU approved to remove bilirubin in liver dialysis; myoglobin in trauma; and blood thinners, such as Brilinta, also called ticagrelor, and Xarelto, also called rivaroxaban during cardiothoracic surgery. CytoSorb is on a dual path to potential U.S. FDA approval with our main program called the STAR-T pivotal study that has now begun under FDA breakthrough designation. That study is designed to remove the blood thinner, Brilinta, during emerging or urgent cardiothoracic surgery, targeting an up to $500 million total addressable market opportunity in the United States. The first patient is expected to be enrolled in the next couple of months. We have a second path to U.S. approval, called the U.S. REFRESH 2-AKI Trial, a 400-patient pivotal study using CytoSorb intraoperatively during high-risk cardiac surgery in patients that are undergoing high-risk surgery. And last but not least, we are partnered with some of the leading players in the medical device industry, including Fresenius Medical Care, the largest dialysis company in the world; B. Braun, the third largest dialysis company in the world; Terumo Cardiovascular, one of the largest cardiac surgery companies in the world; as well as Biocon, the largest biotechnology company in India. On the next slide shows our products and our product pipeline. Through internal development, supplemented with nearly $39.5 million in government contracts and other nondilutive funding, we currently have 3 products that are approved and on the market. The first is our flagship product CytoSorb, which is designed to treat sepsis, critical care and high-risk surgery. The second product is the ECOS-300CY cartridge design to be -- fit into ex vivo organ perfusion systems for the organ transplant market. And then the third product that we have is the VetResQ blood purification technology designed to treat critical illnesses in animals. And this is now being commercialized in the United States. On the right-hand side are things in our pipeline. Of special note is HemoDefend-BGA. This is a filter that can turn plasma of any blood type into a universal plasma product by removing anti-A, anti-B antibodies. Last year alone, we received $8.6 million in contracts from the U.S. Army to help develop this product. And CytoSorb-XL is the successor of CytoSorb, and that is undergoing advanced testing. On the next slide, what does CytoSorb do? And how does it work? Then moving to Slide 7. CytoSorb is targeting deadly conditions that afflict millions of people. As I mentioned previously, we are treating patients in 2 verticals: in critical care as well as in cardiothoracic surgery. Now in critical care, CytoSorb is helping to control deadly, uncontrolled inflammation that can spiral out of control, leading to the failure of vital organs and ultimately multi-organ failure and death. And this happens in many different illnesses, common everyday things that are seen in the ICU, including life-threatening infection and sepsis, which is the overzealous immune response to an infection; influenza; COVID-19; lung injury; trauma; surgical complications; complications of burn injury; cytokine release syndrome in CAR-T cell immunotherapy; liver failure; pancreatitis and many others. On the cardiothoracic surgery side, we are dealing with highly invasive surgery with the major risks of bleeding, shock, severe inflammation, infection, sepsis and others. And the 3 key indications here are: one, the removal of blood thinners, that we'll talk more about in a moment; infective endocarditis; and then high-risk cardiac surgery procedures, such as valve replacement or aortic reconstructive surgery, for example. On the next slide, CytoSorb has been used and well-tolerated in more than 131,000 cumulative treatments as a way to treat cytokine storm and reduce the fuel to the fire of inflammation making it a very powerful new approach to controlling inflammation. And unlike anti-inflammatory drugs that are often too weak or immunosuppressive drugs that are often too strong and can lead to secondary bacterial infections, CytoSorb is right in the middle, helping to control inflammation by, again, reducing the fuel to the fire of inflammation with the goals of improving patient outcomes and survival, while improving -- while decreasing the overall cost of ICU care. On the next slide, Slide 9. The technology is based on a highly biocompatible porous polymer bead roughly the size of a grain of salt. Each of these beads has millions of pores and channels in them that allow them to act like sponges to be able to remove toxic substances from blood through pore capture, surface adsorption and concentration. This is a patented technology that has 16 issued U.S. patents and multiple patents issued and pending worldwide. So this hooks up to standard blood pumps found in a hospital. Blood goes into the cartridge, and big things like cells and antibodies are too big for the pores. They go around the bead and are unaffected. Very small things, like electrolytes, go straight through the bead and are unaffected. But appropriately sized molecules, these inflammatory toxins will get caught up in these beads, all without the need for antibodies, no drugs, no biologics, no cells of any kind. It's all solid-state porous polymer chemistry, making it very efficient at removing these things from blood. And we manufactured this at our ISO 13485-certified facility in New Jersey. On the next slide, Slide 10. As I mentioned, CytoSorb is plug-and-play compatible with the existing blood pump infrastructure that exists in a hospital today. That means we do not need to get into the hospitals' budget or CapEx cycle, right? We are used on the machines that they already have there today, and we are plug-and-play, whether or not it's a dialysis or continuous renal replacement therapy machine in the ICU, an extracorporeal membrane oxygenation machine in the ICU or cardiopulmonary bypass machine in the operating room, for example. And you can see how CytoSorb is up in each of these cases. On the next slide, what is the company's business model and our financial performance? Slide 12. CytoSorbents has a very strong hybrid sales model where we are selling currently in 68 countries worldwide. We just added Singapore recently. And we now have, again, shipped more than 131,000 treatments worldwide, again, split between critical care and cardiac surgery. Now on the direct sales side, we sell direct in 10 countries, the main ones being Germany, Austria and Switzerland and Poland. And then on the distributor partner side, we sell the product in 58 countries around the world: all of Europe, for example; Russia; India; Malaysia; Vietnam; South Korea; most recently, Singapore; Australia; New Zealand; South Africa; all of Latin America, for example; Middle East; Israel. And then from a commercialization focus, roughly 2/3 of our overall unit volume are due to our treating critically ill patients, and about 1/3 are treating patients in the -- that are related to cardiac surgery. Roughly half of all of our patients are actually treated for sepsis. And sepsis is one of the leading killers worldwide every year. It accounts for 1 out of every 5 deaths worldwide every single year. It's a big unmet medical need even with antibiotics. Mortality is unacceptable, and CytoSorbents helping to save these people. By geography, roughly 68% of our overall revenue are due to direct sales and 32% are due to distributor and partner sales. And on the next slide, this slide highlights our very attractive business model. So again, we are a high-margin razor blade that is fully compatible with the existing installed base of machines out there. We have blended gross margins of 81% in the last quarter. That excludes certain onetime items. But even without those items, the quarter before was 82%. We have a direct average selling price of about $1,000 per cartridge. We have 1 to 5 cartridges -- 1- 5 cartridges are typically used on patients depending on the application that we're using. Open heart surgery uses 1 to 2 cartridges. Sepsis uses 3 to 5 cartridges, which is roughly the cost of a day in the intensive care unit. And patients on ECMO, for example, with acute respiratory distress syndrome such as in COVID-19, are often using 5 cartridges or more. To take Germany as a microcosm of our overall opportunity, Germany, as many of you are aware, is the largest medical device market by far in the European Union, the third largest in the world. And in Germany, they have 2,100 acute care hospitals. But 400 are of the size of a Columbia-Presbyterian or a UCSF or a Rush Medical, for example, with more than 400 beds. And each of these 400 hospitals typically sees 300 to 600 sepsis patients a year. At 3 to 5 cartridges at $1,000 a cartridge, that's a revenue per patient of $3,000 to $5,000 and a potential revenue per hospital of $1 million to $3 million for sepsis alone, for example. We had already previously described 1 German hospital having sales of more than $1 million of CytoSorb that has broadly adopted CytoSorb for use in both cardiac surgery as well as in critical care helping to validate this revenue model. And we have many other hospitals tracking along these same lines, giving us very good visibility on our future growth. Speaking of growth, here is our trailing 12-month history of annual -- of 12-month sales. And you can see here that last year was a very strong year for us, where we had $41.4 million in trailing 12-month sales as -- well, actually as of the end of the first quarter. But you can see that it has been a very steady march higher. And we believe that we can -- the opportunity is even much greater than what we're seeing even now. Again, our blended product gross margins have been rising over time. Next slide. So what are the catalysts for growth? Next slide. So one of the keys to our growth is -- are many levers that we can pull to grow. So one of them is global expansion. As I've already said, we're already in 68 countries around the world; direct sales, which again accounts for 68% of our revenue last year; new clinical data, which we are actively working on; new and existing applications; and scaled manufacturing. Next slide, Slide 18. So COVID has been a very interesting animal for us. As you know, it's been -- it's dominated the headlines for more than a year now. And COVID, on one hand, has hurt our business because it has prevented our sales reps from getting into hospitals. It has neutralized the effectiveness of conferences, particularly large trade conferences because these were held virtually and did not draw the kinds of numbers that had been seen before. But on the other hand, COVID has highlighted our business. Because COVID, it is -- people have come to realize that severe cases of COVID are driven by excessive inflammation. Those with excessive inflammation -- uncontrolled inflammation, often have the worst disease and are often the ones on mechanical ventilation, and are on ECMO, and are often the ones that die. And the term cytokine storm has become very popular over the past year, but we've been talking about treating cytokine storm for years. And this is one of the reasons why agencies, like the New York Times, Bloomberg Radio, Fox Business and TheStreet.com have featured CytoSorb on their shows, on their programs during the pandemic. Now CytoSorb has been used to treat more than 5,750 critically ill COVID-19 patients across 30 countries, and we routinely see that there's been a reduction in inflammation and cytokine storm. There has been an improvement in respiratory function, often helping to get these patients off of mechanical ventilation and off of ECMO, and then also stabilizing their hemodynamics. And then some early studies here in the United States, the mortality of patients, particularly those treated with ECMO and CytoSorb, has actually been lower than what is being reported by the international registry for ECMO patients. CytoSorb received U.S. FDA Emergency Use Authorization back in April of last year, enabling us to sell CytoSorb commercially to all hospitals in the United States. And in the United States, it continues to be active despite the rates of COVID-19 going down significantly based upon vaccination rates and decreased new infections. And then finally, CytoSorb is distributed in 68 countries around the world. And in places that we just opened, like Latin America, for example, COVID has been an accelerator of our business. It has actually driven the business faster to the point where we think that in Latin America, we're probably 2 years ahead of where we would have been had it not been for COVID. And we're seeing that accounts that have been using it for COVID are starting to use it for other applications as well, which is very heartening to see given that CytoSorb can be used in a wide range of life-threatening illnesses. Now globally, CytoSorb has been used in many, many countries, and has been incorporated into the treatment guidelines for COVID in many countries. And has been specifically authorized for use in countries like Canada, India, Israel and here in the United States. On the next slide, Slide 20, another major catalyst is expanding our manufacturing capacity to $300 million to $400 million in sales capacity. Our current manufacturing facility has sales capacity of about $80 million in sales. And so we're already at $40 million and -- $40-plus million in sales. And so in order to get a new facility up and running, it takes about 1.5 years to 2 years to build it, qualify it, validate it and get it up and running. So we recently leased our new Princeton, New Jersey headquarters, which will house our new manufacturing capacity. That is expected to quintuple our sales production capacity to about $300 million to $400 million in annual sales. Capital expenditures to build out this facility are a modest $7 million, making it a great ROI. And because, in addition to larger reactors and using the same amount of labor to make 5x the amount of polymer, for example, we're planning increased efficiency through many other modalities, including improved automation. The new facility is expected to significantly drive down COGS and improve our operating margins well beyond -- our gross margins well beyond 85% due to volume manufacturing, leading to well above-average operating margins for our industry. And in fact, we think that we can be in the top tier of operating margins in the medical device industry. So another major catalyst on the next slide is that we had doubled our workforce over the past 2.5 years to more than 200 people. And they are heavily focused on commercialization and manufacturing. And on the next slide, I wanted to take a step back and talk a little bit about Germany, which accounts for about 50% of our revenue. Now Germany, as I mentioned, is a very -- is the largest market in the European Union and represents about a $1 billion to $1.5 billion total addressable market for CytoSorb. CytoSorb has a very strong foundation of growth in Germany. We have an outstanding sales team here with the complement of technical, application, clinical support. We have very strong key opinion leader support throughout the country. We now have dedicated reimbursement. This has been the case for the past several years. That has been supported by major societies, like the German cardiothoracic surgery society, the German Sepsis Society and the Society of Nephrology. And we are penetrated into the vast majority of major hospitals and mid-tier hospitals throughout the country. Here you can see where we were when we first launched in Germany in 2013 on the lower left, and where we are in 2021 on the right-hand side. These are just the big accounts, but we're literally in hundreds and hundreds of accounts throughout Germany. And so we also are helping to drive new volumes through promising new therapeutic applications. Now on the next slide, this is highlighting our -- the productivity of our sales reps and why we think going from 8 to 18 reps will help to drive significant growth in the future. Germany accounts for about 50% of our sales, as I mentioned. And at the beginning of 2020, we had doubled -- more than doubled the number of sales reps and specialists that were selling CytoSorb from 8 to 18. However, as I mentioned, because of COVID-19 restrictions, most of these reps were not even allowed into hospitals for the majority of last year. And here below is -- our slide of -- on the left-hand side is German revenue. On the right-hand side, y-axis is the productivity per rep. On the bar graph are -- overlaid on the bar graph are the numbers of representatives, sales reps we've had in that year. And on the green line is the productivity per rep. So what you can see here is that in 2020, we had 18 reps. They did more than $20 million in sales in Germany. And despite more than doubling the number of reps, the productivity dropped a little bit, but certainly not more than half. And so we went from a productivity of about $1.8 million per rep, which is extremely respectable, down to about $1.2 million a rep when our sales reps couldn't even get into hospitals. So you can imagine that post-COVID, we think that this will translate into even greater growth going forward as these reps become more productive. Now on the next slide, one of the major new applications that we have is the removal of blood thinners or antithrombotic agents during cardiothoracic surgery. In 2020, we received EU approval to remove ticagrelor or Brilinta as well as Xarelto or rivaroxaban during emergent or urgent cardiothoracic surgery in all of Europe. And this approval extends to all of our countries around the world. Now these blood thinners are often used to try to reduce the risk of heart attack and stroke. They're often given to patients with atrial fibrillation. They're often given to patients who've had a heart attack or stroke in the past to prevent future heart attacks and strokes. But the problem is that when they get into trouble, they have to come in for emergency surgery or they get into a car accident or they have a massive GI bleed, these blood thinners will make -- will cause them to bleed in the extreme to the point where that could even be life-threatening and, in fact, cause death. The nice thing about CytoSorb is that CytoSorb is capable of being installed into the heart-lung machine during open heart surgery. And all the while the patient is undergoing surgery and with the risk of bleeding from all the surfaces of the wound, CytoSorb is removing the drug so that postoperatively, they don't have that same bleeding tendency. And I'll share with you some data on that in a moment. But this represents a major application for us. It has nothing to do with inflammation, by the way. It's just the fact that we can remove these drugs. But this is a big unmet medical need that does -- particularly for ticagrelor and Brilinta, there is no reversal agent today. We are the only one, right? And so this is a market that we feel that we can capture at a high penetrance rate. Now another area is in endocarditis. There is a 250-patient randomized controlled trial, called REMOVE, that is planned to read out soon. We're hoping that it is sometime during this quarter. But this was a -- endocarditis is an infection of the heart valve. This happens often when the blood is seeded with bacteria, either through dental procedures or through dirty needles and IV drug abuse. And the instance of endocarditis is rising rapidly in the United States due to the opioid crisis. So the problem is that these patients have to undergo open heart valve replacement surgery in order to fix this problem because they have to get rid of the infection. And these patients are at high risk of having bad outcomes. 15% mortality compared to less than 5% for a traditional valve, non-infected valve replacement and lots of postoperative complications, particularly hemodynamic instability and shock. CytoSorb has been seen to help stabilize patients through the surgery and also after the surgery. And that's one of the reasons why the German government has funded the 250-patient, 15-center, randomized, controlled, GCP-level REMOVE trial. And that trial is done and will hopefully read out soon, and we'll let you know when we have results of that. But if that is positive, one, that could be very good news for a new application in Europe. But importantly, it would then open the door to potential approval in the United States, given that the opioid crisis is really driving the incidence of endocarditis. Now on the next slide is another major opportunity for us in liver disease. It turns out that 1 in 11 people around the world have chronic liver disease due to alcoholism, viral hepatitis and also obesity causing fatty liver. And this leads to about 1 million deaths from chronic liver disease every single year and another 1 million from hepatic cancer. Millions of patients are hospitalized every year for acute exacerbations of their chronic liver disease, and they present often in a hepatic coma. They're often bloated. They're bleeding often. They often have organ injury or organ failure, and it's often the result of some type of insult, like an infection. And so what CytoSorb is able to do is that it is capable of removing liver toxins that a normal liver can neutralize and eliminate them from the blood. So we've been able to wake people up from hepatic encephalopathy. We've been able to stop this intractable itching that they have. And we've been able to stabilize them while they've been in the hospital using our CytoSorb therapy. Bilirubin, one of the toxins that the liver normally detoxifies, is yellow. And you can see -- if you've ever heard of the term jaundice. You can see the patient's eye, down at the bottom here, the whites of their eyes being very yellow because of the buildup of bilirubin in the tissues. But what you can see, if a picture is worth a thousand words, CytoSorb which is normally white. And then after a therapy, it flushed out the blood and you can see what's left: these yellow green beads which shows how much CytoSorb is able to remove. CytoSorb has the surface area of 7 football fields in a single cartridge, massive capacity on which to be able to help with these inflammatory and liver toxins. Now another major application for us is in use with ECMO. ECMO is extracorporeal membrane oxygenation. It is a machine that can oxygenate blood outside of the body when the lungs get so diseased that mechanical ventilation fails. Normally, those patients would die of refractory respiratory failure, but we can salvage them now with ECMO. And it was actually pioneered -- it was actually developed and invented by Dr. Robert Bartlett, our former Chief Medical Officer for 10 years. And CytoSorb is designed to work with ECMO, so while ECMO takes gas exchange offline and helps rest the lungs from a very dangerous mechanical ventilation, CytoSorb is actively eliminating the circulating inflammatory toxins that are causing ongoing lung injury, thereby helping the lungs rest. And we've seen this as a very effective strategy, particularly here in the United States, at helping patients get off of ECMO, get off mechanical ventilation and, in fact, survive. I'll skip the next couple of slides, and I'll go straight to unlocking the U.S. opportunity on Slide 30. Now on Slide 31, this is just a summary of the -- I had mentioned the dual path to U.S. approval. The first path is the U.S. REFRESH 2-AKI pivotal trial. This is using CytoSorb in high-risk open heart surgery patients undergoing high-risk procedures, like valve replacement and aortic reconstructive surgery with hypothermic cardiac arrest. And this is a 400-patient trial where we are trying to -- where we are using CytoSorb intraoperatively during open heart surgery to reduce inflammatory toxins so that they don't cause postoperative complications, like kidney injury that is a predictor of up to 5-year mortality after the surgery. So this study is ongoing now and has enrolled 154 patients. And is -- was delayed because of COVID-19 and some of the hospital restrictions that took place, but is now, again, actively enrolling amongst different centers. But the trial that I wanted to talk to you -- the application I wanted to talk to you about was coming back to the blood thinner application. So as I mentioned, we have approval to remove these blood thinners in Europe. And our goal is to drive approval of our technology to remove Brilinta or ticagrelor during open heart surgery here in the United States. What is the problem with Brilinta? So what happens in these patients is that if you've ever known someone who's gone into the hospital for signs and symptoms of having a heart attack, they'll go into the hospital to be evaluated. But immediately, they typically get loaded on to blood thinners. They call it dual antiplatelet therapy. They get loaded on aspirin and 1 of 3 super aspirins. You may have heard of Plavix. You may have heard of Effient, and then today, we're talking about Brilinta. Of the 3 super aspirins, Brilinta is the only technically reversible antiplatelet agent. It's the only one that does not bind irreversibly to the platelets. So technically, its effect at blood thinning can be reversed. But to date, there have been no therapies that could reverse it, except for CytoSorb in the European Union. These patients then go into the cath lab to get intervened on. But up to 5% to 10% of patients are not eligible for a stent. Because they have multivessel disease, they have left main coronary artery disease. They have intractable ischemia. They're in shock or when they've tried to put in the stent, they may have perforated the coronary artery and put a hole in it that they can't fix. And now these patients need to be -- go into emergent or urgent cardiothoracic surgery, where now they have to crack open the chest and do an open surgical procedure. The problem with this is that having just been loaded on these blood thinners, they bleed. And they bleed intraoperatively, and they bleed postoperatively to the point where it can be fatal and so that's why -- because there's no approved therapy, a reversal agent for ticagrelor or Brilinta in the United States. This is why in April of last year, the FDA granted us breakthrough designation for CytoSorb to remove Brilinta during cardiopulmonary bypass in these types of surgeries and represents a fast-track to potential -- through the regulatory process and to potential clearance or approval. Now last year, we met multiple times with the FDA to present data to support CytoSorb as a low-to-moderate risk device. And just recently, we received now conditional FDA approval of our IDE protocol to run a study called the STAR-T trial that is intended to be the pivotal study to support U.S. FDA clearance or approval. We have now started study initiation with all sites screened and identified, site contracting and IRB submissions in progress, study vendors selected and a data safety monitoring board and a clinical evaluation committee established. We expect our first patient to be enrolled in the third quarter of 2021, and we plan to have more detail on the study once we have full IDE approval, which we expect to get in the near term very soon. Now for those of you who have been involved in cardiothoracic trials or investing in companies that have done cardiothoracic or interventional cardiology trials, some of these names may be familiar. We are very honored to have 2 of the luminaries in cardiac surgery study -- in cardiac trials be the PIs of our study, and that is Dr. Michael Gibson and his credentials are below his name. And also Dr. Michael Mack, who is a very accomplished cardiac surgeon, who has been involved in many of the great innovations in interventional as well as cardiothoracic surgery. Dr. Gibson has been involved in most of the blood thinner trials amongst many other studies. And Dr. Michael Mack is heavily involved on the medical device side. So we're very grateful to have their participation. Now to highlight the risk of having ticagrelor or Brilinta on board when you go into surgery is this slide. This is the registration trial that got Brilinta approved in the United States in the first place. And what they did in this study was compare the risk of perioperative bleeding compared to the -- another drug called Plavix or clopidogrel. And what you can see here in black is ticagrelor; the hatched bars are clopidogrel and under -- on the x-axis, you see days after being loaded on ticagrelor or Brilinta. So if you have to go to surgery within 1 day, you can see that your risk -- if you were loaded on Brilinta, is that you have a risk of 65% chance of having a major, fatal or life-threatening CABG-related bleed. And even clopidogrel or Plavix, there's almost a 60% risk of this life-threatening bleeding. Now the only known mechanism, outside of CytoSorb, to reverse ticagrelor is time. Let it wash out of the system. But you can see here, even after 4 days of washout, there's still a 50% risk of having a major, fatal or life-threatening bleed, right? And this is where the unmet medical need comes in. So on Slide 35. Slide 35 basically highlights a seminal study looking at the bleeding complications when CytoSorb was used or when it was not used. This was a retrospective, observational, single-center study. But what you can see on the left-hand side is that when Brilinta was used, if you had CytoSorb, versus in black, if you did not have CytoSorb, you had significantly shorter operating time because you're not spending all this time trying to stop bleeding. Far fewer platelet transfusions compared to the control group, and far less surgical -- postsurgical drainage out of the chest tube, 350 ml versus 890 ml in the control. And importantly, none of the patients had to go back for re-exploration surgery, often called rethoracotomy, where more than 1/3 of patients in the control arm had to actually go back and explore to see what was bleeding, right? That's the dilemma of the cardiac surgeon. They're, 3 days out, 4 days out of the surgery, they're still losing a lot of blood. So the cardiac surgeon is saying, is that the drug? Or did I nick something on the way out? And then -- so they often in these patients have to go back in to see whether or not there was a surgical error or was it just this drug that was on -- this antithrombotic agent was on board. But what you can see here that nobody required rethoracotomy versus, again, more than 1/3 requiring rethoracotomy in the non-CytoSorb treated group. That led to fewer days in the ICU, fewer stays in the hospital. And when health economists in the U.K., who advise NICE on the medical device side, evaluated this data, they projected that if this were used in the U.K., they would save roughly $5,000 a patient, including the cost of our device, right, which is -- goes to show you how expensive bleeding complications can be, not just expense, but the risk to the patient as well. Okay. So when we look at the overall market in the United States, there's 50,000 patients on ticagrelor today that need -- I mean, this year, there'll be 50,000 patients on ticagrelor that will need emergent or urgent open heart surgery. This is the exact patient population we're targeting. At $5,000 a device, that's a $250 million initial U.S. total addressable market and given that ticagrelor is now the only reversible super aspirin on the market. We believe it will displace the other products, both Plavix and Effient because it's safer. Why would you ever want to load your patient with an irreversible platelet inhibitor, like Plavix or Effient, when you know 5% to 10% of them are going to surgery and will have that bleeding risk. So we think that ticagrelor will gain market share, and it also goes off-patent in 2024, which will dramatically reduce the price, which is the only thing keeping it from having more than the 40% to 50% market share it has today. And with that, we believe that can drive a $500 million total addressable market opportunity. So when we look at the opportunity in cardiac surgery, today, it's $250 million, tomorrow could be $500 million as ticagrelor gains market share. If we can remove other anticoagulants, like the NOACs or DOACs, like Xarelto or Eliquis, which we can, by the way. The data that I showed you also shows the same trends when Xarelto was being used. But that would expand the market to $1 billion total addressable annual market. And then if we could be used in all surgeries, that could be a $2 billion overall market just in the United States alone. So we're now preparing for U.S. commercialization. We have hired Jim Komsa as our VP of Sales and Marketing in the United States. He was a former high-level VP at Medtronic, leading their restorative therapy and pain groups and also was the former Head of Cardiac Surgery in the northeast region for Medtronic. Medicare, earlier this year, announced a 4-year automatic reimbursement for breakthrough designation medical devices, of which we are one of them. So that is something that we look forward to once we -- if and hopefully, when we get approved. And then we also hired David Cox, who is a veteran from Integra Life Sciences, as our Vice President of Global Regulatory Affairs. And his job is to help smooth any discussions with the FDA and get this product approved here in the United States as well as other regulatory functions. And our goal is to be prepared for a U.S. launch at the time of a potential FDA approval. So in summary, CytoSorbents has the potential to become a highly profitable, elite performer in the therapeutics space, comparable to biotech companies and probably far above medical device companies with industry-leading operating profit margins. We have a solid record of growth with a very profitable razor blade in someone else's razor business machine. We have a strong foundation and are well funded for potential future growth with a lot of new applications and existing applications. We are working to drive FDA approval through this dual path: one for blood thinner removal, and one through the REFRESH 2-AKI trial. And then last but not least, we have extensive validation from physicians around the world, leading strategic partners, U.S. government agencies and media. So with that, I will stop and if there's, Tim, if there's time for questions.

Dr. Chan, thank you. We have a few minutes left. So we'll just jump right to the top of the queue of the Q&A. So likely, I would mispronounce this one. But do you have an opinion on the CYCOV results from Freiburg, Germany?

Yes. So the CYCOV study was actually just released. It was a 17 by 17 randomized, controlled trial in non-selected COVID-19 patients on ECMO. And meaning that there were no -- there were very few selection criteria. CytoSorb is really designed for hyper-inflamed COVID-19 patients. They took all comers. In that study, they actually showed that there was a higher mortality in the CytoSorb-treated group and recommended against the use of CytoSorb -- early use of CytoSorb with ECMO in these -- in COVID-19 patients. However, what I can tell you is that when you look at the data, what you can see is that there's a -- despite it being a randomized -- small, randomized, controlled trial, there's a clear bias for sicker patients in the CytoSorb-treated group, particularly in factors that are known predictors of mortality. Particularly take a look at the D-dimer levels, which were 9,000. The median was 9,000, all the way up to 21,000. D-dimers are a reflection of clot burden, and clots cause major damage throughout the body and have been highly associated with mortality in these patients. It was -- the median was 9,000 versus 4,000 in the control, for example. That's just one indication that in a small study like this, they were not able to achieve this balance. So we think that this is one of the major explanations for those results. We are not seeing those results in the United States, for example. In fact, based on data from our U.S. CTC registry, the use of CytoSorb with ECMO is very safe. And in fact, the mortality is quite the opposite. It is, in fact, lower then the averages that are being reported by ELSO, which is the Extracorporeal Life Support Organization that monitors all ECMO activity around the world, and far lower than the mortality being reported by the single center. And the data are coming from multiple centers in the United States, major ECMO centers with far more patients. So we think that the data from the CYCOV study is really mainly a small study with a clear evidence of bias in terms of the randomization.

Thank you, Dr. Chan. We'll try to sneak one more here. What is your current outlook on the geographic impacts of COVID going forward?

So in the United States, I think COVID is hopefully in the tail end as we are hitting 50%, at least of the population with 1 vaccination. We're seeing that it's turned down in Europe where it was -- they weren't suffering from the third wave. And then India is still -- is coming down, but still 0.25 million new cases a day in India. So there's a lot of still opportunity for us there with our partner, Biocon, the largest biopharmaceutical company in India. And then where it's really out of control, though, is in Latin America, where, again, we have a very strong presence now and where usage of CytoSorb continues.

Great. Well, just at the end of our time here. So we'd like to thank Dr. Chan and CytoSorbents for presenting today and for you all for attending the 2021 Virtual UBS Global Healthcare Conference. You're now free to disconnect, and have a great day. Thank you.

Thank you.