Xvivo Perfusion AB (publ) (XVIVO) Earnings Call Transcript & Summary

Good afternoon, and welcome to Gothenburg, for those who braved the elements and came here inside. And a big welcome to those of you who are listening in on the live broadcast. This is a very special day. It's the inaugural Capital Markets Day for XVIVO. Today, you will learn about operations, gain clinical insights and also learn about the strategic road map for XVIVO during the coming years. My name is Lars Frick. I'm a journalist at Tidningen Börsveckan, and I will be a moderator here today. The Capital Markets Day will be hosted by management from XVIVO as well as clinical partners who will participate. It will be broadcast live. And for those of us who join on the Internet, you can ask questions, too. Just use the Q&A field, which is below the screen on your browser, and then I will forward this during the Q&A sessions. So on a practical note, today is divided into 3 main areas. First of all, it's the economic side of operations with markets trends, strategy and health economics. After that, there will be a Q&A session. And for those of you who are present here, just raise your hand, say your name and your organization, and then we will pick it up with the mic. After the Q&A session, there's a 15-minute break, and then we move into the middle part of the CMD, where we will hear more about heart and abdominal, the new areas here for XVIVO. There's another Q&A session, break. And in the final part, we will focus on the current core business, the lung business, and also gain some insights into the future of transplantation. With that, I would like to introduce the CEO of XVIVO, Dag Andersson. Welcome.

So thank you very much, Lars, for an excellent introduction, and welcome all to GoCo arena, which is a location where we are at right now, and this is going to be the leading life science cluster in Sweden in the coming years. So why did we organize our Capital Markets Day, where Lars touched upon it? First of all, I would like, of course, to introduce the management to you all. Secondly, I would like to tell our story and why XVIVO is the company to invest in. And thirdly, but not least, our strategic road map, which will be presented during the afternoon. So starting by introducing the management team. I will start with Johan Holmstrom, Chief Commercial Officer. He is accountable for ensuring that we sell enough products at the right price, to make it very simple. He has a background from Mölnlycke and from Permobil. Charlotte Walldal, Global Head of R&D, accountable for our exciting R&D portfolio. Background from leading positions within R&D at Essity. Katrin Gisselfalt, Global Head of RA QA, has worked a couple of years at XVIVO and previous experience from QA RA at Abigo Medical and at R&D at Artimplant. Andreas Wallinder, Chief Medical Officer. Started in his position approximately at the same time as I joined the company in May-June last year. Previously, cardiothoracic surgeon at Sahlgrenska and Alfred Health in Melbourne. Christoffer Rosenblad, Chief Operating Officer and Head of Biz Dev, been with the company 9 years and served as a CFO until end of last year. And the young person on the block, so to say, Kristoffer Nordström, CFO. Also worked a couple of years at XVIVO and CFO since end of last year. Then we have Rodney Jones, General Manager, North America, who has traveled all the way to participate in today's Capital Markets Day. And we also have Arjan van der Plaats, Global Head of R&D Abdominal, meaning kidney and liver, who has joined us from -- traveling up from Groningen, Netherlands to be here today. So welcome all, and I will start off by talking a little bit about the need for transplantation. So only 10% of the total need of organs are transplanted in a year, 160,000 versus 1.6 million needed. Why is it like this? Well, there are 2 reasons. Number one is that the number of organs donated is far too low. By the way, hand of heart -- on heart, how many of you are registered as organ donors or live in a country where the [ old stuff ] model is applied. I'm not going to ask you to raise their hands but ask yourself that question. Second question is -- second reason for the low unmet need, so to say, is the organ utilization. It's very low. Many organs are wasted, and we will talk about this later on and explain what we can do to solve this problem. So in the U.S. alone, 150,000 people are waiting for a new organ, and even worse, 25% die while they are waiting for a new lung or heart. Every 10 minutes, a person is added to the waiting list. Just to give you a perspective of what it means to be on the waiting list, the median waiting time for an individual's first kidney transplant is 3.6 years. The good thing with kidneys is that once you reach what is referred to as the end-stage renal disease, there is the option of dialysis, but it's costly and does not make your life very easy. The average wait for lung transplant in the U.K. is 18 months, 18 months of suffering, of anxiety. So now it is time for you to meet the patient and not just any patient, but the patient we know. [ Bea ], this is your story. [Presentation]

Every time I watch this movie, I'm very touched actually. [ Bea ] is 23 years old. She lives in Lund, South Sweden. 3 years ago, she received her first pair of new lungs. Unfortunately, they are no longer working, and she is on the waiting list for the new pair of lungs. [ Bea ], a young person who just wants to live a normal life and who deserves to be given the opportunity to do so. At XVIVO, we believe in an extended life of organs. Nobody should die waiting for a new organ. This is our purpose. This is XVIVO. XVIVO was founded 23 years ago here in Gothenburg where the head office is, listed on mid-cap NASDAQ since 2016. 6,627 shareholders -- lost count, including several pension funds. I dare to say that our large shareholders, many of them present here today, have a long-term perspective on their shareholding, which somehow shows the faith they have in the company and in our future. XVIVO is a so-called all-organ company, and we address all major organs with the exception of pancreas. We became an all-organ company October 1 last year when we acquired the Dutch company, Organ Assist, providing unique technologies for kidney and liver transplant. Addressing all organs means that we provide advanced machines and solutions for the preservation and/or evaluation of these organs. As you can see from the picture here, kidney is the most transplanted organ in the world. One reason for this is that end-stage renal disease has become an incredibly critical chronic disease as more and more patients around the world end up on dialysis if they are not successful in receiving a new kidney. There are today more than 4 million people on dialysis. So you can imagine the unmet need for a new kidney. Liver is the second most transplanted organ, and lung and heart make up together 10% of all organs transplanted. Our technology saves organs so that others can save lives. This is a strong statement. And what it actually says is that it takes lives to save lives. So what is it that XVIVO does to actually save lives? We increase the availability of organs with our technology. We improve the preservation of organs once they have been removed from donor body and during transportation to the transplant hospital. Our unique technology improves organ functionality and, consequently, the survival of organs. The key is to ensure that new organs function for as long as possible in the recipient body. As an example, the transplanted kidney lasts, on average, 10 to 12 years, but you can do, of course, several kidney transplants during your life. So this was the introduction. I will now talk a little bit about the markets and the key trends on the market. I mentioned in my introduction that only 10% of the need of organs is transplanted and that the reason for this is lack of enough organ donors and poor utilization of organs. Starting with lungs. How many donated lungs do you actually believe are today successfully transplanted? Not many, 20%, 1 in 5. 80% are wasted. The utilization rate for heart is not much better. 30%, 1 in -- less than 1 in 3. Kidney. Yes, better, but 1/3 of all kidneys wasted. And liver approximately the same, 1/3 of all livers also wasted. Today, most organs are donated by patients whose death has been confirmed using neurological criteria, also known as brain death or DBD. There is low or no use of organs donated by patients whose death is diagnosed and confirmed using cardiorespiratory criteria, referred to as DCD. It is, of course, more challenging to identify suitable DCD donors, hence, the very low use of DCD organs, particularly in thoracic transplantation. Organs do deteriorate after re-treated for both DBD and DCD patients. But for natural reasons, organs are easier to assess for DBD donors, since this is a slower death process than DCD. Sounds a little bit brutal, but that's how it is. So when it comes to the world and the future, we forecast that, by 2030, equal amount of organs will be donated by patients whose death has been confirmed using cardiorespiratory criteria, DCD. This will lead to more organs available for transplantation provided that the organs can be transplanted, and this is where machine perfusion once again is so critical. The more DCD organs, the more needs for machine perfusion to evaluate the organs. Just as a side note, I'm sure that some of you are thinking here, "Why does it say 39,000 donors when there are 160,000 transplants around the world?" Well, one donor can do a lot, You can actually save 8 lives. You have 2 kidneys. The liver can be split into 2. You have 2 lungs. You have a pancreas and you have a heart. You can save 8 lives. When it comes to XVIVO and the product range and assortment, we have a unique product range to preserve and perfuse organs. And this product range will be explained and described later on when we talk about the strategic focus areas but just to show you the full range of products that we market today. So when it comes to the key takeaways from market and trends, I would just like you to remember the following. Remember, the shortage, demand is 10x higher than supply. Remember also that utilization of organs is incredibly critical. Only 1 in 5 lungs and less than 1 in 3 hearts today can be transplanted. Machine perfusion is proven to increase utilization, and we have the widest and, I must say, also the best machine perfusion offering in the world. So this was market and trends. So moving into the next section, strategy. There have been some publications today related to XVIVO in [indiscernible] the latest one that came this morning -- not the latest, the second latest actually. It's stated in the press release that strategy, it's about making choices and about deliberately daring to be different and always, for us, considering our overall vision that nobody should die waiting for a new organ. So talk a little bit about strategy for the coming 5 years. I just want to give you a little bit of feeling for how we reason when we had our strategy workshop here in Gothenburg in August. One of the very few management books which has really inspired me is a book called from Good To Great. It was written by Jim Collins in 2001. Fantastic reading. If you haven't read it, read it. In this book, Collins examines the performance over 40 years of 1,435 U.S. companies. And out of these 1,435 companies, only 11 were classified as great companies based on certain criteria. Hence, the title of the book, from Good To Great. These 11 companies managed to take complexities and boil them down into simple yet profound ideas, and this was done by asking 3 very simple questions. One, what shall and can we be best in the world at? Second question, what are we actually passionate about. And third question, what is the economic denominator that best describes our economic engine. So when we, as a management team and some other members of the organization met in August to set the direction of our company, we concluded the following. Number one, what we can be best in the world at is machine perfusion. Perfusing organs enables more organs to be successfully transplanted. Number two, our passion is to extend the horizons in transplantation. Remember, [ Bea ] and the short movie we showed earlier. And three, economic engine. Our economic engine is revenue per installed machine. The machines are installed to ensure that they are utilized to perfuse organs as often as possible. This is how we make money, and we'll make even more money in the future. So summarizing our strategy on one single page, which can sometimes be a little bit difficult. Just to give you an overall view picture, our purpose, as earlier mentioned, is that we believe in an extended life of organs. Nobody should die waiting for a new organ. Our strategic objective is to develop our position as a global leading own organ company. Our economic engine, which I mentioned, as a global leader in machine perfusion, is to maximize revenue per install machine. And I will now very briefly touch upon the strategic focus areas, and they will be repeated by my colleagues and people invited here later on during the afternoon. But just to give you, let's say, your first feeling for the strategic sort of focus areas. So I will start with becoming a global leader abdominal with initial focus on the U.S. Today, the U.S. is the largest transplant market in the world. We are a global leader in lung transplantation, meaning that we sell machines, consumables and solutions for the preservation and valuation of lungs. Strong position in the U.S., and we will now embark on the same journey for the abdominal organs, kidney and liver. Starting with the unique Kidney Assist transport, which will be launched end of this year once we have received the 510(k) clearance from FDA in the coming weeks. You will hear more about these exciting products and the go-to-market plans later today by Arjan van der Plaats and Johan Holmstrom. We have strengthened the commercial organization to make as much impact with this product from day 1 as possible. Just remember what I said earlier, 4 million dialysis patients around the world; in the U.S., between 700,000 and 800,000. The need for kidneys is consequently very high, and our transplant device is absolutely unique and provides the best outcome for transplanted kidneys. We also have a liver perfusion device, which will be launched once we have achieved FDA registration, a process which has commenced but focuses now on kidney. Second one. Second strategic focus area. We have a game-changing heart preservation technology, which will be commercialized 2024 in Europe. Our technology will transform heart transplantation. Clinical trials, ongoing in Europe where close to 45 patients have been included, and new sites are being added as the interest in participation in this study is very high. U.S. trials will start first half next year. One of the challenges with heart transplantation today is that ischemic time is limited to 4 hours or less, meaning the time a heart can be outside the body. This makes it impossible for many hearts to be transplanted, and that is why only 30% of donated hearts are transplanted. So this is one strategic focus area, and you will hear much more about this during the afternoon. Third one. We have -- we are focusing on increasing the penetration of the machine perfusion. Remember the economic engine of XVIVO, revenue per machine installed. Clinically, nobody is arguing that against the very clear benefits of machine perfusion. The challenge with machine perfusion is that it adds time to the transplantation process rather than simply moving an organ from donor to recipients with highly uncertain outcome. Machine perfusion provides the opportunity to evaluate and also restore organs, but it takes time and adds cost. Therefore, we are working with organizations such as Lung Bioengineering in the U.S., which you will hear about later. We have a person participating digitally from Lung Bioengineering, talking about the hub concept for perfusion. Digitalization is another area we are working with to predict the outcome of organ transplantation better, and we have a pilot ongoing in the Netherlands in the new University Medical Hospital in Groningen, and we will also soon launch a U.S. pilot. Number four, health economics, all inclusive reimbursement. Health economics is incredibly important to prove the cost benefit in order to secure the good reimbursement rates, and we are now actually making health economics part of our research projects. More and more countries are adding and/or increasing reimbursement for transplantation and, particularly, so far, machine perfusion initiatives. You will hear more about this from Johan Holmstrom after the short strategy introduction. For an organ such as kidney, health economics is very easy, actually. The patient on dialysis in the U.S. costs approximately $80,000 per year, $80,000. The kidney transplant in the U.S. costs approximately $140,000. Payback can be quite easily calculated. So last but not least, China. China is today the second largest transplant market in the world after the U.S. With 1.4 billion people in the country and rapidly growing need of new organs, China will eventually overtake the U.S. How long this will take? Hard to predict. In China today, there is no reimbursement for transplantation at all. A kidney transplant at China international hospital in Shanghai costs $62,000; liver, $98,000; lung, $170,000; and a new heart, $160,000. Not too many patients can afford this. Reimbursement will come. Our focus today is on securing regulatory approval for the key products we want to launch in China. We have a sales manager recruited, and we continue to reinforce the organization in China. This is the only strategic focus area which will not be further explored today, but this is a strategic focus area for us, and China will grow in importance. So I would now like to hand over to Kristoffer. Are you ready to talk about financial targets and commit ourselves in front of this audience?

I'm more than ready, Dag. Thank you.

Great.

Hi, everyone. As Dag mentioned in his introduction, I have been with the company for a couple of years now, 4 years. And for me, and I think I speak for all of my colleagues as well, becoming an all-organ company in 2020 was a true paradigm shift. It was the beginning of a journey, and I think that is a mindset that we should continue to have during this presentation and also during the day, that we are now taking steps on a very interesting journey. For the last 20 years, we have developed an expertise within lung transplantation, and we have actually created the market of lung preservation and lung evaluation. So what we will do now is that we will take the experiences and the knowledge that we have from lung and transfer that into other organs as well. For example, it's about delivering a profitable business model to other organs. It's about establishing a global market presence for other organs. And also, very important, it's also to navigate in a strictly and pretty complex regulatory environment that we have experience in. So what is our business model then? As Dag has mentioned earlier, we have an economic engine very strong, strong focus on machine perfusion. The leading KPI for us will be revenue per machine because that is what it all boils down to for us. It's about to drive volumes, volumes of solutions, volumes of disposables, which we have the so-called razor blade revenue model, meaning that we don't necessarily need to make money on our machines, but we need to get the machines out there and build a solid installed base. So we should offer flexible financing solutions for our customers. If we take a little look to -- at the historics of XVIVO, in terms of sales growth, we have had a 21% sales growth up until 2029. That only includes lung sales, as you all know. That is driven by machine perfusion, 42% annual growth rate of machine perfusion, which is very strong coming from us, introducing a new product to the market. Static preservation, meaning Perfadex, has more or less grown with the market, 6% to 7% per year, steady growth. So how big is the transplant market? Well, that define -- that depends on how you define transplant market. Is it pre care, after care? Is it senior transplantation, et cetera? That's not really easy. What we focus on here today is the potential of -- potential market value of machine perfusion. By that we mean, if all transplants today came from machine perfusion, if that was used on deceased donors, it would have been approximately USD 1.3 billion. That does not include machine sales. It's only sales per procedure. The potential is huge because, today, only 15% of that total potential market value is realized, and we all know that the market -- total market will grow with a number of transplants, and machine perfusion will grow as the technique is adopted, more usage of DCD, et cetera. It's also interesting to look at the value split per organ of the market potential. Liver and heart, around 30% each. Lung and kidney, around 20% each. If we look forward a bit, in terms of XVIVO sales, our ambition and our strong belief is that our thoracic sales will equal the size of -- our abdominal sales will equal the size of our thoracic sales in the end of the strategy period. That will be driven by our introductions of our new techniques on new markets. Sales by region will not differ that much compared to what we see today, but in monetary terms, we believe, as we have said, that Asia, and China in specific, will come. So my final slide on financials today. Profitability. We think it's important to send a message that we will have a -- focusing very much on topline, of course, of sales, but we will do it in a conscious way, also focusing about our profitability. So EBIT, 20%, end of the strategy period; EBITDA, 30% at the end of the strategy period. And we will achieve that by delivering on our 5 strategic focus areas and also keep a very high focus on pricing and our work with our gross margins. That will be very important, all this while we will continue to reinvest strongly in our R&D portfolio because that is what really will bring us to a very, very bright future. So it's time to wrap up the strategy session and the financial ambitions, and I would like to invite Dag Andersson once again to do this. Here you go, Dag.

Thank you, Kristoffer. Now we have truly committed ourselves to deliver. So just to conclude, key takeaways. You have seen the 5 strategic focus areas which will make us a leading all-organ company. We talked about machine perfusion. We'll talk more about that this afternoon. The revenue model for lungs will be applied to kidney, liver and heart as well, I mean revenue per installed machine, and we have our profitability targets. So this was the end of the strategy session.

Thank you very much, Dag and thank you, Kristoffer, for your excellent presentation on markets and strategy. Now it's time to move into health economics and questions of reimbursement, where Johan Holmstrom, Chief Commercial Officer, will guide you. Welcome, Johan.

Thank you. Thank you, Dag. Dear audience, in this section, I will give you an overview of the activities which XVIVO is involved in when it comes to reimbursement and health economics. As you heard during Dag's introduction, the global organ shortage is a major challenge for health care today. Only 10% of the need for transplants are met in this today. So obviously, the health benefit from solving this is obviously very, very large. The waiting list situation is one indicator that we often talk about and that is visible, but it actually fails to capture the true magnitude of organ shortage. There was a study a couple of years ago that was published showing this. And if you look on the graph to the right, you can see that there are more than 14 times people dying from end-stage organ disease than who are assigned to the waiting list every year, and this is U.S. only. So when you translate this, and it was the same conclusion from this study, the possibility to replace organs and tissues on demand, so meeting supply with demand, will leave a health benefit on par with curing cancer. Quite fantastic and says something about the magnitude of the market that we are operating within. So obviously, health benefits is the driver to reimbursement. So new technologies, products, et cetera. When you can show the health benefit versus the cost are the same, it's the driver to secure reimbursement. Clinical evidence is the foundation for this, something that XVIVO obviously have in our background for our products. What's also interesting is that all reimbursement today is on a national level. So very often, individual countries, particularly in Europe, once they do their own clinical investigations to make sure that they get the right clinical guidance for clinical practice and, in the next turn, being able to give the financial guidance that can conclude what kind of reimbursement level there is for this is, of course, extremely important for us as a company. So XVIVO is directly or indirectly involved in a number of initiatives that will open up reimbursement in Europe for machine perfusion in particular. We'll talk more about Europe, but just a few comments about the U.S., which you will hear more about later today is that it's basically covered through what's called CMS, the Center for Medicare and Medicaid, in combination with private insurance. These also follow each other. So the metrics which private insurance offsetting or sort of defined or very similar to the metrics which are defined by Medicare and Medicaid. In Asia and China, there is hardly any reimbursement today. It's out of pocket, most of it. In Europe, which is obviously a well-reimbursed market in general when it comes to health care, the intervention of transplantation as such is reimbursed. But when it comes to utilizing new technologies like machine perfusion, it's only reimbursed in very few countries today. So the market is about to open up against this. We see a very positive development today through the different initiatives which are ongoing today. France is one. You will hear more about that. Belgium, Netherlands, Germany, and U.K. But even more so, we had the opportunity to participate, in end of August, in Milan in a Congress for the European Society of Organ Transplantation. And what was very clear takeaway from that meeting is that the debate is not so much about the clinical value and the health benefit from using machine perfusion, which it probably was a few years ago. Today, the debate is about how do we secure funding for this, how do we make sure that money is fueled into this in Europe. In the U.K., a very positive announcement was made in May where NICE -- and NICE is the National institute for Health Care and Excellence. They issued their recommendation when it comes to using XVIVO lung perfusion, EVLP for preservation of lungs. You heard from Dag, waiting list, up to 18 months in the U.K. This was the kickstart for initiating the reimbursement process for EVLP in the U.K., where now in September-October, there will be a start of a national EVLP program in the U.K., which will be driven in a hub model. XVIVO is very much involved in this, and it will be our machine, XPS, and products that will be used for this. This will commence over a 12-month period, from which then the financial guidance will be met and the expected reimbursement to be defined in early 2023 latest. Most likely, it will happen earlier than that. France is a very progressive case. It's one of the countries in Europe that has come the longest when it comes to machine perfusion. Both EVLP and machine perfusion for kidney is granted reimbursement already in France. When it comes to lungs, it was granted in 2019; and kidney, a little bit earlier. What's interesting here as well is that -- and this was also demonstrated at European Society of Organ Transplantation in Milan earlier in this year, was that they have shown significant increase in available organs and improved transplant outcomes from this. Very, very positive. And they were also showing very clearly how these have made savings to health care, particularly for kidney, and where post-transplant dialysis costs have gone down and overall cost for renal services has gone down whilst increasing number of transplants. So it's a very good case for how reimbursement can be made in the area of machine perfusion. When it comes to liver, in France, it is also, they say, on its way. XVIVO is well involved in this, in close collaboration, where Liver Assist, our machine perfusion, machine for liver, is used in what's called a HOPExt trial. It's a multicenter with 8 different centers today running this. Time line for when is not known yet, but it's -- it will come. Netherlands, we have some very positive news at the latest. Kidney machine perfusion was reimbursed successfully a couple of years ago. But what we have learned also from our meeting in ESOT is that EVLP will now be granted reimbursement -- full reimbursement from January 2022. And secondly, also liver machine perfusion will be granted full reimbursement from January 2022. So France, the Netherlands are probably the most leading countries today in Europe when it comes to developing reimbursements. So to wrap up and leave you with some takeaways from this session. I think the health economic benefit from increasing number of transplantations is very clear today, and it's something that will continue to increase. XVIVO, as a company, we are supporting and participating in a number of initiatives to drive reimbursement and funding to this field. Clinical evidence, which is one of our strong points, is a key driver. And last but not least, which is something we think is very interesting, is that the clinical acceptance of machine perfusion is there. The debate is rather how do we secure more funding in Europe and European countries against this technology. Thank you.

Thank you very much, Johan. With this presentation on health economics, the first segment of the Capital Markets Day has been concluded. And now there is time for questions and answers. [Operator Instructions] And for those of you present here today, just raise your hand and you will get a mic and then state your name, organization, and we will take your question, too. So Dag, at the core of the sort of financial side in XVIVO, you mentioned revenue per machine as a key metric. Could you say something about what characterizes a good question or a profitable -- a good customer or a profitable customer? Is it mature centers, centers with high volume or maybe there's a regional difference?

No, no. But I mean there are certain centers, taking U.S. as an example, where hospitals such as Cleveland, for example, is using our XVIVO lung perfusion technology on a very frequent basis. And that is, of course, an ideal customer. I mean we want customers to use our products as much as possible. And if we take the case of Cleveland, they actually have a success rate using our technology of 70% of the lungs actually transplanted comparing with the 20% who don't use this technology. It's a very proven technology, and they love it. So they use it a lot. Sometimes you have an organ or a lung which you can see from the beginning that we don't need to produce it. It's in perfect condition. Then you don't have to apply the technology. But ideally, whenever there is some kind of uncertainty, you should use our technology. So the answer is quite simple, Lars. I mean we want our customers to use our machine perfusion technology as much as possible.

Yes. And can you see a sort of a maturity thing there that perhaps customers who get the first systems installed and when they -- that there is a learning curve, they learned to use it and appreciate it, and maybe that will, over time, extend into more cases per machine?

Yes, absolutely. And I think it has also to do with, at the end of the day, leadership and how hospitals are organized. I mean taking Cleveland as an example, again, I mean, they have a specialized recovery team who flies out to collect the organs. They have a special perfusion team who uses our XVIVO lung perfusion technology, and they have the transplantation team. So if you are well organized, you know how to do things, you will, of course, do it also really well. Not all customers are like that, unfortunately. I mean there are many hospitals in the world, which we all know that don't function that way. So you need to have a certain organization and structure in place to make it to reap the full benefit of machine perfusion.

So you need the sort of infrastructure around it?

Absolutely.

Kristoffer, we have a question from our online audience, which I think will be perfect for you. Peter Östling at Pareto Securities wants to know why you don't have a goal for sales. And perhaps, you could expand a bit on your view on top line growth during the strategy period, '22, '26.

Thank you. Yes, I know Peter, and he always has good questions. So my first answer is that we -- I mean this is the first time we provide some guidance on our financial ambitions, and the strategy period is not over yet, so that might come. But we are at the stage in the company now, as I said, build on a journey where there are some very important milestones ahead of us as well that we are not fully in control of. We are in a very, very regulated environment, and it -- for those reasons, we do not give any forecast on sales at this moment, but it might come.

Right. Peter Östling has a follow-up question as well regarding the revenue per machine KPI. And he wonder is this something that you will share with the market in forthcoming quarterly reports. Or...

Yes. Initially, that is an internal KPI for us that we need to work and we'll focus very hard on internally. And if we can also, of course -- we will, of course, discuss that with -- when we get answers. But to have that externally in our reporting, we're not there yet, but we're very clear that, that is a key metric for us.

We have a question from the audience. Please, name and organization.

Great. Ulrik Trattner, Carnegie. Just going back to the fundamentals, looking at the U.S. market, obviously, the most established ones in terms of number of transplants and reimbursement. Just give us your highlights on what's holding back the adoption and utilization. Looking at what you have done so far, obviously, a good relationship with Cleveland, United Therapeutics, with Lung Bioengineering. Do you believe that everything is in place right now to increase utilization and we're now approaching a sort of tipping point? Or what's holding back the adoption?

Right. So I'll just repeat the question, so it's clear for the [ large show ] as well. So the question is what's holding you back in the U.S. Are there any factors that are limiting penetration? Or do you see us coming closer to a tipping point where efforts such as in Cleveland could perhaps be an inflection point and a boost for sales and revenues there going forward?

But it's a very good question, actually, Ulrik. If you look at XVIVO lung perfusion penetration globally, I mean, it is in the U.S. that we have the highest penetration of lung perfusion, whereas, Europe is still far behind U.S. In the U.S., we have some very large customers, that's correct. I mean we have Cleveland. We have Lung Bioengineering, which we'll listen to later on. We have a number of machines installed in the U.S., and we are talking about, I think, around 30 machines, around that. So the potential is there to do much more than we do today, and I think somehow we just have to work closer with the hospitals. I mean every hospital knows the benefits of this technology. That's not an issue to -- trying to explain that. We don't need to. Financials, reimbursement is there. And in the U.S., you get more money if you are successful with transplantation than if you fail with transplantation. So all -- everything is there to make it work, Ulrik, and we are increasing penetration. If you look at, historically, the way we have grown, Kristoffer, with XVIVO lung perfusion in the U.S., we have talked about very high growth rates.

Sure, yes.

So penetration is increasing, and we will just continue to do more work with all hospitals where we have machines installed today, yes.

I think there's a follow-up question from Ulrik.

Yes, please. Two questions, actually, one to Kristoffer and one to Johan. Can you perhaps start off, do you believe that your pricing model for the XPS system is sufficient or sort of cheap enough to penetrate the sort of small markets or the small transplantation center markets? Or is there a way around this to simplify these procedures or to sort look at the leasing segment of this business? And to Kristoffer, as you're not guiding on top line, but you're guiding on your margin profile, give us some clarification on what type of products are included and then what type of research products that should be been concluded by 2026. Is this to be assumed at pure transplantation, i.e., yes, you might sort of realize that -- I'm alluding to the PrimECC research program. Is that to have been concluded in 2026 in order to realize your margin targets?

All right. So 2 questions here. Pricing in the U.S. and then a little bit of flavor on your targets here. So perhaps, Kristoffer...

I think I'll start answering, Ulrik, that it's -- right, start from the back. In terms of PrimECC, we definitely believe that there will be a launch in -- within the strategy period. That is our ambition. Regarding -- it's not -- so to say, it's not taken in consideration, though, in the guidance on the profitability that we have guided on because we haven't really decided upon the price point, et cetera. So that is beyond that. What was the...

So -- and what's -- yes, the pricing question was...

Pricing question on XPS.

Yes, XPS.

XPS system and...

The [ expensive ] -- yes.

I think that is a question that Johan might answer.

Sure. Yes. For the U.S. specifically and in general, it's -- I would say, we are working with not just direct purchase of machines to the customers, so alternative models, like you mentioned, leasing options, price for intervention, et cetera, is something we have full flexibility for. When it comes to pricing, where there is no reimbursement, of course, the investment of a machine becomes a big investment, particularly in Europe. In the U.S., I think the game is completely different. We know and we see something very different, where lung transplant on its own is the most profitable intervention that a hospital can do in terms of reimbursement for it. So in light of that and the investment of buying the machine and buying the consumables is not really the biggest hurdle that we see today. And as Dag also said, I mean, we are increasing our prices again now from first quarter 4 in the U.S. So they buy into the concept when it's there. The cost hurdle is not the issue necessarily. There is a balance to that, of course.

Right. Were there any more questions from the audience? Yes. We have one on the right side. Mic is on the way.

Mattias Häggblom, Handelsbanken. So 2 questions, please. DCD donors is expected to accelerate to 12% per year going forward from today's low level or no use at all. So it wasn't clear to me what's driving that and to what extent that's even more beneficial for you as a company. And secondly, on the 5 strategic pillars, which 1 of the 5 do you feel most comfortable in reaching? And which one is most out of your control, so to say?

Right. So with regards to the 5 pillars, which one is -- do you feel most comfortable with? And which is perhaps the most stretched target?

I mean it's also a very good question. I would say, all strategic focus areas have to be ambitious. That's why we make a strategy. We believe that we can manage all of them. Some -- we are already doing a lot with today. For example, machine perfusion, we are in machine perfusions. It's about developing that further. We are working with the head of economics, but we will also do that in a different way. I would say the one which is probably the most challenging short term is China because China doesn't have reimbursement today for organ transplant. And that, of course, makes it challenging to sell in China. We are selling, and we have employed our first person. We have an office in China. And I'm pretty certain that reimbursement will come in China. As an example, reimbursement for dialysis was gained not long ago, and now they are sort of paying quite well for dialysis. And that's why suddenly there is 1 million dialysis patients in China. So it will come. But I would say that out of these 5, it's probably China where we have to work with sort of new models, which we haven't sort of done too much in the past. So that's my question or my answer back to you. So machine perfusion, we are doing it now. So it's evolution. China is new, even if we have taken a few initial steps.

Right. And then there was a question from Mattias Häggblom regarding DCD, how come going from virtually 0 to...

No, no. It's also a very good question because if you take a DBD patient, I mean, the DBD patients, when you die from brain death, it is a controlled process. You are in the hospital for quite a long time, typically. So you slowly disappear. During that time, your organs can be monitored. That is why it has traditionally been so much easier to use organs coming from patients dying brain death. Some countries in Europe, strangely enough, Finland, our neighbor, and Germany, they are still forbidding DCD organs, which I find absolutely ridiculous, sorry to say that, but it's -- that makes it hard to achieve your transplant targets. So in the future, there will be more organs coming from patients dying circulatory death because there are more of those patients dying circulatory death. And with our technology, evaluating the organs, you can assess them, you can evaluate them and you can use them. With traditional technology, it has been very difficult, and that is why it has been forbidden in a number of countries but it's opening up. Many countries have opened up to DCD organs. Did that answer your question?

I think Johan has a comment here as well.

Yes. Just to build on that, I mean, this is also what we see in France. We see it at the Netherlands, and we see it in the U.S., as the recent numbers we had on kidney, for example, where the growth of the transplant from DCD organs was up 15% year-to-date in August in the U.S. So...

And following up a bit on that, Johan. I mean looking at European reimbursement landscape, it's very heterogeneous with some countries, obviously, in the lead like Netherlands and France where some are lagging. Do you think that when one country in the EU moves towards reimbursements, that it's -- puts pressure or at least give some incentive for other nations to follow the lead? Or is it completely sort of independent variables?

I mean, European countries, they look at each other, what's going on. And if you take the issue of NICE guidelines in U.K., for example, all countries are looking at NICE recommendations in the end as one example. So of course, there is positive contamination cross-border when it comes to reimbursement trends in this area, and they learn from each other. And you see that also in our congresses like ESOT, where we were participating, right? There's a lot of cross-border exchange. Decision on reimbursement is national, but of course...

Yes. Peter Östling from Pareto Securities would like to know more about the reimbursement situation in Germany. Can you comment on that, Johan?

I can comment. I mean Germany is a little bit more behind many European countries. I actually was in Germany last week and met with one of the bigger hospitals in there. And the quote, of course, it will come. It will take some time, that's what they say, but it will come. We have to because we can't manage our situation without it, and we also need to manage DCD organs over time. It will take some time. It's a different political situation in Germany as well in this area. But yes, the hospital we were talking to, a very prominent, say this will happen. It will take a little bit longer time.

Right. And Kristoffer, even though you don't have a stated or formal revenue target, but could you say something about the revenue split during the coming sort of the strategic -- the 5-year plan in terms of organic sales versus inorganic? Do you foresee any acquisitions? Is that part of the plan?

I mean, this strategy we have presented now does only contain our organic growth ambitions. So I think it's a short answer to that.

Right. There is a question from the -- yes, we have more questions from the audience, please.

Caroline Banér at Danske Bank. So I was just wondering if you could share some color on the hub setup you're looking to launch in the U.K.? And is this an opportunistic approach? Or is it also something that you would have seen -- would have liked to see regardless?

Could you please tell us some more about the hub?

Absolutely. It's something we definitely want to see. It's something actually part of our strategy to encourage as well. And you will hear more from Lung Bioengineering later on. That's -- you can say it's a hub model, where they are perfusing lungs for other hospitals. And in the case of the U.K., it was actually on the initiative in that, I believe it's [indiscernible], who will be the lead and where they will do become the hub for perfusing lungs for a set of different hospital. I will not go into each, but it's a group of 3 or 4 hospitals during this first 12-month period, where they will do their clinical evaluation of it. So in the end, when you look at EVLP and lung perfusion, it's something we believe is a very good setup to go for because you also get the critical volumes of lungs into it and that learning curve that needs to be from both our side as a company as well as the clinical side of it. So U.S., it's been proven very successful. So yes, hope that answers. We see it very positively.

Another question that I'm interested in. In the presentation, you talk about forward integration as part of the plan within machine perfusion. So could you say some more about what that entails? Is it sort of moving into services related to the machines?

Or -- I mean, there are many aspects of that. I mean, we believe that we need to make life easier for our customers in many cases. And as I said during the presentation, there is an -- it adds extra work for hospitals to perfuse organs compared with the traditional old, call it, ice-box technology. So if there are ways whether we can cooperate with companies, logistics companies, service providers, team up with them to maybe in the future, then create an offering which will make it easier for our customers to perfuse more organs. So forward integration in terms of cooperation with other entities, definitely, and we are looking at that all the time to see what are these opportunities, especially on the U.S. market right now, but it will, of course, even also impact other countries around the globe.

Right. Thank you very much, Dag. Thank you, Kristoffer, and thank you, Johan. Unfortunately, that's all the time we have for this Q&A session. So now there is a short break. Please join us again in 15 minutes. Thank you. [Break]

Back to XVIVO Capital Markets Day 2021. Now it's time for the second segment of today's presentations, where the heart and abdominal therapeutic areas will be presented. So starting off with heart, Chief Medical Officer, Andreas Wallinder, will guide you now. So welcome, Andreas.

Thank you. So dear audience, dear listeners, in the next 30 minutes, we're going to spend talking about heart transplantation, XVIVO's heart preservation technology and the early experiences from users of this technology. First, some key facts. The annual global number of heart transplantation that's being performed is around 8,600. And we have about 350 centers globally performing heart transplantation. The organ utilization rate, as been mentioned now a couple of times, is low. 3 out of 10 donor hearts are eventually being used for transplantation. The main market challenges are a growing need for heart transplantation, and that will require use of DCD hearts. And also that the transport time, meaning the time that a donor heart can be without circulation, is limited today. And that puts restrictions on how many and how far you can go with a donor heart. Before we get into the heart transplantations as such, I want to spend a slide talking about the underlying disease of heart failure. So heart failure is describing the condition when the heart is not doing its job properly, meaning not pumping enough blood to supply the organs with oxygen and nutrients. So heart failure is a chronic illness. And once diagnosed, the medium survival expected is often around 2 years. So when a heart failure progresses into the final stages, the patients, they have an extremely poor quality of life. And actually, the median survival at that stage is comparable to many of the most aggressive cancers, between 6 and 12 months. So heart disease is a leading cause of death globally. So around 25% of deaths are attributed to heart disease. And as an example, me, a white male in the mid-40s, my life risk of being diagnosed with heart failure is around 30%. So at the final stages of heart failure, transplantation is a life-saving and prolonging treatment. But it's just available for a very small minority of all people or patients that have developed heart failure. Looking at heart transplantation today. So this is data presented by the ISHLT, the International Society of Heart Lung Transplantation (sic) [ International Society for Heart & Lung Transplantation ]. And as you can see, the number here is different from the 8,600 that I just mentioned. But this is the largest organization that collects and reports data from heart transplantation. So this and the following slides will be based on data from this organization. So the last couple of years, an increase in the number of heart transplantation is performed. And as you can see, that increase mainly consists of increased activity in the U.S. Heart transplantation relies on the [ adversity ] gift of someone, the gift of an organ, in this case, the heart. The heart donor and the heart recipient, they are located most often on different hospitals, in different cities and different regions or even in different countries. And the transport of the donor heart between the donor and the recipient side is critical. The time is critical for the result of the outcome of the heart transplantation. So today, before explanted, the donor heart needs to be flushed with a cold solution that arrests the activity of the heart, cools it down and allow for low metabolic activity during transport. Today, as during the last 50 years, which is actually the full history of heart transplantation, hearts have been transported in cold solution, in plastic bags on ice. So -- but once the heart is arrested and the absence of circulation, nutritions and oxygen, that induces a progressive degradation of the tissue of the heart, and we call this ischemic injury. When the heart is restarted in the recipient, the extent of that ischemic injury will be reflected in the performance of the heart and eventually, the outcome for the recipient. So the impact of this is ischemic time. So on the X axis here, we have the ischemic time, and on the Y axis, the risk or hazard ratio of mortality at 1 year. So what you can see here, when we move from 3 hours to 5 hours, we actually increase the risk of death at 1 year with almost 50%. And this graph looks very similar to the first one. But here, instead of ischemic time, we have age on the X axis. This corresponding risk increase, about 50%, you achieved by moving from a donor age of 35 to about 50. So taken together, each hour of ischemic time we add to the donor heart adds 15 -- or sorry, 10 years of age to the donor heart. So this is a critical thing. This also restricts how far you can travel to collect or to -- a donor heart. So here displayed as Sweden or Gothenburg being the center of the picture. So for a transplant center in Gothenburg, the area of uptick or the potential travel time restricts us to use donors from Northern Europe or Middle Europe. Just an extension, let's say, for extension [ up to ] 6-hour would allow us to go much further for collecting donor hearts. This will allow for optimal allocation and matching between donors and recipients but also extend the number of available donor hearts for people on the waiting list. But already, short ischemic times have impact on outcome. So failure of the transplanted heart is actually the leading cause of death during the first 30 days of the transplant. And this injury is caused again by the time the heart has been preserved on ice during transport. So to summarize the challenges in donor heart preservation, as the ischemic injury to the donor hearts during transport of ice is causing, and that translates into poor function of the transplantation. And it is the limited ischemic time allowed, ideally below 4 hours. This is one of the reasons why surgical team still turn down about 70% of available donor hearts. And a better preservation technology could improve post-transplant outcome but also increase the use of donor hearts from further distances. Professor Stig Steen learned. He recognized this problem almost 30 years ago, and he started to develop something else. He wanted to move away from the ice box or even the ice age into something new. So piece by piece, he developed a new technology that eventually become -- became a continuous perfusion of the donor heart during transport, with a tailored or special solution for this purpose and the continuous supply of oxygen. And this is what now -- what we now call a nonischemic heart preservation. A large number of preclinical publications have proven the benefit of this technology. It's demonstrated that the reduced ischemic injury during transport translates into better organ quality after transplant. In a very extreme experiment a couple of years ago, this technology provided evidence that hearts can be preserved up to 24 hours outside of the body and then successfully transplanted. This technology also, for the first time, allowed successful transplantation and long-term survival in xenotransplantation, meaning transplantation between species. And we will hear more about this later during this afternoon. So this is the sort of the prototype that came out of the research at Igelösa on the left-hand side, needless to say. And this is, on the right-hand side, what the product looks like today. So the technology, again, creates an optimal environment by continuously providing substances -- critical substances and oxygen to the heart during the transport. It's got 3 components, device or the machine, a portable device that is used for the preservation. It's got the solution, a especially tailored solution for this purpose. It's then again [ oxinated ]. And then it's disposable, a single-use set is installed and connected to the heart machine. So offer a long preclinical phase exploring and refining this technology, the first-in-human experience was published in 2020. This came from the Skåne University Hospital in Lund and described the first 9 patients that were transplanted with hearts using this technology. A control group from the same center and the same time period was used. What you can see here is during the first 6 months of observation, that we had a full 100% survival in the group transplanted with hearts from this technology and then no major outcome related to graft failure. The recruitment is still ongoing for this study. In parallel, a group in Melbourne, in Australia have started to look into the extended ischemic times. So remember the graph I showed you a couple of slides ago, the risk increasing when you move above 3 hours. So this group already now have started to explore the effect of using hearts preserved with this technology for between 6 and 8 hours. The first hearts with ischemic time have been transplanted successfully in this trial, and we will definitely hear more about that. Over to the XVIVO-sponsored studies. So the 2 previously mentioned studies from Lund and from Australia, they use this XVIVO technology, although they are run by investigators. XVIVO-sponsored studies, currently, we have a multicenter trial in the EU ongoing. We will hear more about that. And we are currently recruiting at 6 sites, and we are investigating hearts within the normal sort of transport span up to 6 hours. In the U.S., we are in ongoing discussions with the FDA and in preparations for an IDE submission later this year. We do additional preclinical testing. And actually today, we perform a transplant studies at Igelösa in the South of Sweden. We aim to have this submission to the FDA end of this year and to start the study during the next year. So to sum up, the key takeaways from heart is that XVIVO's technology have absolute potential to change how we see a heart preservation today. We think we can improve the outcome of the heart transplantation by replacing what we have today, heart in an ice box, with a technical solution giving perfusion to the heart during transport with an [ oxinated ] solution. We can safely extend the time a donor heart can be outside of the body. And with that, allow for long-distance transport; for better allocation of donor hearts; and very importantly, for surgeons, remove some of the pressure that is always there with the time limitation that they work against. Also increase the utilization of donor hearts by moving into the extended criteria hearts and also with longer distances. And with this slide, I'll introduce the next speaker, and that is Professor Filip Rega from University Hospital in Leuven. Filip is a cardiac surgeon and also the principal investigator of XVIVO's EU trial. Over to you, Filip.

Thank you, Andreas, and welcome, everyone. My time -- my relation with Stig Steen goes back 20 years ago. I was a research fellow in Leuven in the laboratory, working on how to extend the preservation interval during lung transplantation. And I had to find, I had to fly to Lund in order to find out what Stig was doing and to bring it back and made research on it. It ended in my PhD presentation in 2003. And you see here on your right-hand side, the acknowledgments. I owe a lot of credit to the knowledge that I learned from Stig Steen. Leuven, Leuven is a small town, a small medieval town, quite close to Brussels, 20-minute drive; only 100,000 inhabitants, but a 2,200-bed hospital. And we do about 30 transplants, heart transplants a year. And on your left-hand side, you see a diagram of the International Society for Heart & Lung Transplantation depicting the number of transplants performed per center. And then you see that actually most centers only perform between 10 and 19 transplants per year. Once you go above 20, you reach a lower number of transplants. We reconnected with Stig Steen's research group in 2018. Also, in Belgium, we have this problem of an important donor organ shortage, and we wanted to extend to the so-called donors of the circulatory death, DCD donors. And here, you see 2 of our research fellows, [ Vincent Franzela and Kathrine von Andriza ]. The main reason to go in communication with Steen was how to evaluate heart function in these new type of donors. It resulted in the onset of the initiation of a successful clinical program. And earlier this year, we were able to publish our first few cases. Going back to nonischemic heart preservation. But of course, when we arrived in 2018 in Sweden, we learned about how far they were with machine perfusion and heart preservation. Standard cold storage was the standard method, as Andreas alluded to, for more than 50 years. We flush the heart and store it on ice and never thought about it whether it was a good way or a bad way. But there are important limitations to this preservation. And this, again, is a slide from the International Society for Heart & Lung Transplantation depicting the outcome, survival at 1 year in relation to ischemic time. And you see it starts to hinge up somewhere between 180 and 210 minutes. And these are data from 2007. Did we change something over the past decade? Well, on your right lower-hand side, the data from 2018. But also here, survival comes down. The risk to die increases once you arrive at 3.5 hours. We didn't change anything. By storing a heart on ice, there's absolutely no possibility to assess the heart function. And of course, since it's a static procedure, there is no opportunity for organ repair. So we were in need in the clinical field to extend the possibilities of our preservation protocol. And over the past 20 years, Professor Stig Steen came out with always small pieces of the puzzle on how to preserve the heart in the ideal way. There was the reason behind the temperature. There's an optimal low temperature to preserve the heart, which is probably somewhere between 8 and 10 degrees. And secondly, there is the reperfusion solution, which is basically an extra cellular type of solution with a high oncotic pressure based upon albumin and a low hematocrit. And as Andreas alluded to, it eventually led to a publication where Steen able, in animals, to preserve hearts and successfully transplant them afterwards with a preservation interval of 24 hours. This led to the onset of the first-in-human trial by the Lund people and now initiated in 2020 -- the end of 2020, the EU CE Mark trial. This is an open-label trial, randomized, and we plan to include 202 patients, 101 standard cold storage preservations and 101 machine-perfused hearts. The primary endpoint is outcome at 30 days. It's a composite endpoint consisting of death, the use of ECMO, primary graft dysfunction and acute rejection. The secondary endpoint is more or less a similar composite endpoint, but then looking at 1 year. If you look to the milestones of our own center, we submitted the research file, the clinical trial file in June 2019, and we finished all of our administration by June 2020. 20 June, the first patient signed the first informed consent document. But also in Belgium, our clinical activity was importantly impacts by COVID-19. So our transplant activity only restarted in September 2020, being able to include our first patient on November 25. And these are some pictures reflecting the emotions in the night of the 25. You'll recognize on the left-hand side how we mounted the heart on the cannula and on the machine. On the pictures with the persons, you might recognize me, in the middle is Karlien Degezelle, the Chief of our perfusion; and Michiel Marynissen, our Senior Resident. On the picture, probably a bit too small for you, but you can recognize Kathrine von Andriza, our research fellow, assisting Stig Steen in Igelösa, Lund, Sweden. You can start video #1. This is what happens when you come off bypass, cardiopulmonary bypass. And normally, the video starts, video #1, then you see a very enthusiastic heart. On your right-hand side, this is the echo. And I can assure you, both ventricles did perfectly fine. If you're able to start video #3 now, then you see the heart function. This is the left-hand picture of the heart at 1 month, perhaps a bit of pericardial fluid, patient, by the way, being at home. And then the right-hand side is an echo with myocardial function, video #4 at 3 months. And you cannot recognize the difference between this heart and the normal heart. Where are we now? Well, we included 14 patients, 6 of them were randomized in the machine perfusion group, 7 are randomized to control. In 1 patient, we only found out during the [ pre-elevation ] with people being on site that the donor was operated in the chest as a child. And this is an exclusion criteria to be included in the trial. I mentioned here, actually, we only have 1 refusal of a patient. And actually, we were still in communication that didn't sign the informed consent. So that means that all of the patients on the waiting list, eligible for a heart transplant, did sign their informed consent. In Europe now, 6 centers are actively, including patients. The 3 first were Leuven, Gothenburg and Paris. And later on, Munich, Madrid and Berlin followed. And actually, if I'm informed well, Bad Oeynhausen is actually finished all of the administration. Heidelberg, almost the same. Newcastle, Birmingham, Bordeaux and Padua will follow soon. By now, we have close to a bit more than 40 patients included. That means that in September, we reached officially our 20% milestone, and we plan to conclude the trial. The last inclusion is expected to be in December [ '22 ]. What are the potential benefits? And of course, we have no access to the trial data. This is simply an emotional expression of what we observe. What you see here is a text, the [ works app ], written by Steffen Rex, which is one of our most senior cardiac anesthesiologists, who was on call last Friday to Saturday. And I received it, as you can see, 9:00 in the morning. And you probably do not all understand Dutch, but this is the translation. XVIVO heart was again terrific, even with severe pulmonary hypertension in recipient novel problems. I leave open between brackets, but this is what he said, also thanks to top anesthesia, of course. What are other long-term benefits? Well, you see them summarized over here going from graft outcome to expanding the type of donors we use. Looking at graft outcome. And this is on your right upper hand slide, you see one of the molecular or biochemical data from the first-in-man trial, looking at enzymes that are released when myocardial cells die. And they were much lower in the machine perfusion group versus the standard cold storage, and this with only a low number of included patients. It's probably not really on its place here, but sometimes patients with end-stage heart disease are helped out with a mechanical support device. And now we're almost at reimplanting so-called third-generation devices. So a result of research going on for more than 30 years. And I can assure you that neither the life quality or the life expectancy comes close to the quality of life and the survival after transplantation. What about logistics? Imagine that we can preserve a heart for 24 hours. Imagine we can even do it longer. It means a lot of opportunities to optimally match the donor versus the recipient. It means that the atmosphere in our OR and with our transplant coordinators will really slow down to a much nicer and workable pace. But also much more difficult patients can be enlisted for heart transplantation, patients that are on a mechanical support device. We expect that the number of patients with congenital heart disease, that have been operated 2, 3, 4, even 5 to 6 times, where you expect a very long explantation time, well, with machine perfusion, we think we have an option for them, too. What about other types of donors? Well, this opens the door to use donors from so-called marginal donors, marginal quality, but also -- and it has been mentioned previously, so-called donors after circulatory death, where you take out the heart and you can place it on the machine. With this, I hope I can conclude my slide, and I conclude my presentation. Thank you for your attention.

Thank you very much for an enlightening section here on heart, where Professor Filip Rega gave us some real insights on some films as well. Now it's time to move on in the schedule in the body. So we're happy to welcome Arjan van der Plaats, who is Region R&D Director, who will talk about the abdominal product line and the U.S. go-to-market. Welcome, Arjan.

Thank you, Lars. Dear audience, now I think it's time that, indeed, we continue with our journey, and we leave the thorax for what it is right now. And we move our focus towards the abdominal area, where we can find our liver and our 2 kidneys. But before, let me first summarize some of the key facts that we already presented to you earlier this day. In contrast, basically to the heart, we see -- we have a fairly high amount of transplantations in the abdominal area, with 62,000 livers -- or kidneys and 28,000 livers transplanted worldwide each year. And even though, as Dag mentioned before, the utilization rate is quite high. It's more than 60%. But still, we have the challenge that the -- there's a big gap between the demand and supply of donor organs. And that forces basically the surgeons to use more and more the lower-quality DCD organs. To support that, XVIVO, especially since the acquisition of Organ Assist last year, we have now placed in new markets devices for liver and for kidney transplantation, and even a second-generation device is already underway. So focusing on that abdominal product line. What we then have is for kidney, we have the Kidney Assist Transport to optimally preserve the kidney during transport. We do that by cold oxygenated perfusion. And basically, as I said, all the entire period between taking the organ out of the donor during transport, all the way towards the recipient. On the other side, for liver, we have the Liver Assist, which is a platform that can also provide cold oxygenated perfusion. But on the other hand, also can do warm perfusion for evaluation of the liver. In contrast to the Kidney Assist, the Liver Assist is basically a stationary device that is used in the recipient hospital and not during transport. Zooming in then further into the Kidney Assist Transport, what we then basically see is that the concept is not that different than the concept of the heart system, as was just now presented by Andreas. We also have a device with a single-use perfusion set. And with that, we pump solution through the organ, in this case, a kidney. We cool the machine by ice. And by that way, we have cold perfusion. Additional benefit, too, of our systems is the oxygenation. Same as in the heart, we really believe that it is beneficial also in the cold to have full and active oxygenation of the solution. And by that, we have made now a machine that can preserve kidneys better during the transportation phase. Literature tells us that cold perfusion, even without oxygen, is already beneficial compared to cold storage for all donor types. We see that in a less injury of the kidney, but also an improved graft survival. If we then add the oxygen, what is our specific feature, we see that these results are even better than without oxygen. We have a better function, we have a higher survival rate, and we have less complications. And these conclusions, we can take from a very nice multinational clinical trial that was led by Professor [ Plukh ] from Oxford, and that was published in the prestigious Lancet at the end of last year. What we did in that study is we compared standard machine perfusion, so cold machine perfusion without oxygen, with cold machine perfusion with oxygen. So we could really study the effects of the oxygen. Both groups were perfused in the Kidney Assist Transport first generation. A nice feature of this study is that it was completely blinded. So for the perfusionist, the person operating the device, but also the surgeon, the donor surgeon, but also the recipient surgeon, were completely unaware if the oxygen tank was filled or not. So it was completely blinded for the whole team involved. So we included for that 106 kidney pairs, originating from donation after circulatory death donors with age 50 or higher, which basically is about 80% of the DCD population. And that gives us another nice element of the study. As you see, we have a paired design, meaning that since we have the 2 kidneys in 1 donor, we could have 1 kidney randomized to nonoxygenated perfusion and the other kidney to oxygenate perfusion. And that paired design was all the way through the analysis. So that gives us -- gave us a very nice insight in the effect of oxygen. So what we saw is that we improved kidney function, but more importantly, we drastically reduced the graft failure by more than 70%, and that's an enormous result. And that was mainly due, we think, by the fact that we have a major reduction in rejection of the kidney. So that's a rejection of the kidney after transplantation purely by the oxygen. So in conclusion, we can say there that our machine, our Kidney Assist Transport machine, providing cold oxygenated perfusion is really beneficial for the kidney during transport. And it brings us more towards our mission to have an extended life of kidneys. And in this case, DCD kidneys. Same concept we have developed for liver, where we have the Liver Assist in cold oxygenated perfusion but only, as I said, in the hospital, in the recipient hospital itself. What we see here from literature is that, indeed, this process gives us a lower injury of the liver. And that leads, again, to patient benefits like reduced length of stay in hospital after transplantation, but also an increased graft survival and even an increased patient survival. So very, very nice clinical data there gathered by the team of Professor Porte in Groningen in a multinational study, again, using -- comparing statical storage. So that's the standard of care in liver preservation. And we compare that to statical storage, but then followed by a short period of only 2 hours of cold oxygenated machine perfusion prior to transplantation. For that, we included 156 livers, also originating from the DCD donor. And what we then saw is that we, not only indeed prevented injury of the liver, but we had a tremendous decrease in biliary stricture. And that is exactly the Achilles' heel in DCD liver transportation. So that gives a lot of biliary injury, and that leads to large interventions, therapy and even retransplantation. So also here, what we see is that a short period, only 2 hours of cold with oxygenated machine perfusion already gives us a better preservation. And we need that indeed to lead towards an extended life of organs. But we can do more. As I told you, the Liver Assist is a platform that can also do warm perfusion. We do that with blot or blot-like solution. And that allows us to evaluate the function of the liver because it is fully functioning, hopefully. And this is a protocol that is implemented in the University Hospital in Groningen, again, Robert Porte's group. And what they have seen, if they evaluate livers that were declined by all the 3 liver transplant centers in the Netherlands, and they evaluate it and they comply to their viability criteria, that those livers are perfectly well to transplant. And it's safe to transplant, and they function pretty good. And by implementing this protocol, they have now seen that in their program, they have increased their liver transplantation by 20% already. And as of today, that number is growing every week as they are using it more and more. So what we see here is that, that 1 perfusion increases the utilization of livers already in the donor pool. And that brings us closer to our second mission: nobody has to die waiting for a new organ. Then zooming out a little bit again. And we can ask ourselves the questions, do we really need to pump all livers? Probably not. So if you can imagine, a healthy DBD donor; sportive guy, well, maybe Andreas; no smoking; no drinking, probably that liver will not benefit from machine perfusion. But we also saw that if we have the lesser-quality DCD livers, that those really benefit from cold oxygenated perfusion, even though it's a short period after cold storage. But our true potential lies in the high risk of the owners. So the donors of which the quality of the donor livers of which the quality is now unknown. And there, we see that if you apply the cold oxygenated perfusion to improve the quality of that organ and then evaluate it with warm evaluation machine, then you can still decide, based on the variability criteria, to transplant deliver or discard it after all, but then at least it is an informed decision to discard the liver. So in summary, what we -- I have shown hopefully is that cold oxygenated machine perfusion is a better preservation method than cold storage for both DCD kidneys and livers. And that the underlying clinical data is very solid and even published in the 2 top-ranked journals in our field. Last but not least, what we also saw is that warm perfusion allows us to evaluate the liver. And by that, we can increase the utilization rate. We, at XVIVO, we are very proud that these technologies are now more and more introduced in clinical practice in Europe. But of course, we want more. We want to expand it. And one of the expenses is going to the United States. And for that, I would like to welcome Johan Holmstrom again, to tell us all about it. Johan?

Thank you, Arjan, and thanks for having me up here again. I'm not sure I would tell everything about our go-to-market plan for U.S., but the purpose is to give an overview of what our plan is about. U.S. market is obviously the single largest uniform market today when it comes to kidney and liver transplants. You heard from Kristoffer and Dag about one of our strategic imperatives to become a leading position for abdominal in the U.S. And clearly, that's a priority that we are now planning towards and investing towards as well. U.S. market is not just the single largest market in absolute terms, it's also the fastest growing today when it comes to kidney and liver. There is a perfect, as we see it, market opportunity for our technology to meet this development. U.S. transplants are expected to reach 50,000 by 2026. And a big part of that, obviously, will come from a disproportionate growth of utilization of DCD organs. And this is where our technology fits well into this. Our estimate is that we can address at least 75% of that market with our technology that this will be needed for. What's interesting, and I think I said that in one of the questions earlier when it comes to the development of transplants in the U.S. for kidney and liver, but we have seen this year, in 2021, and where that growth is coming from DCD, that kidney is increased 15% already and 8% for liver. This should both then be compared to only using DBD organs, which is at a relatively flat level of 2% to 3%. The initiative to increase number of transplants to 50,000 by 2026 is a commitment and an endorsement by AOPO, which is the Association of Organ Procurement Organizations in the U.S. And what we think is really interesting here is when you look at some of the initiatives that they talk about to make this real, and particularly #3 and #4 here, maximize organ utilization, that means that they will start to utilize much more of DCD organs than ever before. And now before, and perhaps that's where we also come into the picture, the use of innovation. So new technologies like machine perfusions, for example, is going to be very important to realize this objective. Whilst this is true for kidney and liver, it's also relevant for EVLP and our lung perfusion business in the U.S. So a very positive development. When it comes to launch the first product, we will launch in the U.S. will be Kidney Assist Transport. You heard Arjan van der Plaats talk about this product. And we announced in May, when we did our filing for 510(k) for this product in the U.S., but we now are waiting for the final FDA approval. And since then, we've been in a launch planning phase, really starting to plan our commercial activities for the market release and starting to build the rate capabilities behind the launch. Our objective is to get the market clearance during quarter 4 this year. Go-to-market model and value proposition. Kidney Assist will be positioned as a premium product, with a value proposition that improves both the clinical outcomes that you have heard from Arjan. But also we want to make sure that we also can support the performance metrics that the surgical centers and the AOPOs are set against when it comes to reimbursement and the levels they need to stay at to be -- to keep their license. So in the U.S., the Centers for Medicare & Medicaid Services, CMS, is -- as I think we said earlier, is the single largest payer for health care in general and for transplantation in particular. And most commercial payers, also those insurance, et cetera, they follow the same sort of lead metrics that CMS is placing on AOPOs and surgical centers. So that's important for us because with our products, we know then that we can help AOPOs and surgical centers to both improve and stay within those defined metrics, securing reimbursement, securing the right quality whilst, at the same time, increasing the availability of transplantable organs. So it's a very strong story with a very strong clinical evidence behind it. When it comes to the go-to-market model as such, it's something we will have a variable model for. We will -- we realized that one of the things that is very important is to build an installed base as quickly as possible. And in some cases, different customers are in different cycles when it comes to how they make their investments. So we will have a blend of placing machines as well as a direct sales of machines, of course. But back to our economic engine, revenue per machine is what we will drive. So building an installed base, taking market share in that way is going to be one of the methods we will do, of course. There will be a dedicated commercial team for abdominal. We have a team for the thoracic area today. And we have now started to invest also into abdominal, both when it comes to marketing capabilities as well as sales capabilities. And this will continue slightly ahead of the curve, but also in pace with our development, of course. And in the end, making sure that this will enable that we have a strong pull-and-push strategy to create demand from transplant centers, but also to make sure that the AOPOs can keep on that level where they need to be. Target launch dates for Kidney Assist Transport, I said we expect clearance during quarter 4, which will enable us to start doing prelaunch activities, and then to have more of a, let's call it, full force launch in January 2022. When it comes to liver and Liver Assist, which will then be our second product, we're right now in a process for FDA application and the definite time line for when we will actually enter the market, but that is too early to say today. So Kidney Assist Transport is #1. And before I close, some of the key takeaways that I want to leave you with is that, first of all, there is a very clear ambition within the U.S. to increase number of transplants. DCD organs will be one of the key drivers behind that, the utilization of DCD organs. And with our technology of machine perfusion, it fits extremely well to that ambition. And 2022 will be our focus for kidney, and liver will follow after that. Thank you.

Thank you very much, Johan. That concludes our second segment of the Capital Markets Day here, and we're moving into the Q&A session. So for you who are viewing us online, remember post your question in the Q&A field below the screen. And for those of you who have joined us here inside, please raise your hand. I see, we have a question already from the audience. So let's start there.

Ulrik Trattner from Carnegie. If I'll just start off with a question for Professor Rega and in terms of you mentioning the utilization of marginal organs. Just your perception among you and your colleagues, how big of a difference does Xvivo's heart machine does do in terms of increasing the utilization? And where do you see this progressing over the next few years?

Thank you for your question. It's pretty interesting. I think it can -- the answer consists of 2 elements. First of all, what you see on the waiting list, the number of patients does not reflect the real need because we know we do not have enough hearts to transplant. And one of the reasons is because we are much too strict when it comes to accepting an organ. Very often in a small donor hospital, you do not have all capabilities like -- to make an angiography of the coronary arteries or a reliable echocardiography. And once you start to doubt, you reject the heart, in fact. So yes, you mentioned that you can use the non-ischemic heart preservation machine and assess in a way biochemically or in another way, the heart function, then that will open an enormous amount of opportunities to assess those hearts and eventually accept those hearts. To give you a number on how much that will, in reality, give us. Imagine, so we are doing 30 transplants a year. This is half of our annual Belgian transplant activity. Imagine that you add 5 to 10 hearts per year for an 11 million population, then we jump that year with 10%. And then you make for these 10 patients, the life completely different. So we still have to prove that scientifically. But at least now, we have a tool to do that. So we look forward to the future on that.

Right. I would like to continue to expand on this direction, because it seems like 2 opposing forces. On the one hand, you have this great unmet need, which sort of forces you to explore perhaps less ideal donors like circulatory death, obviously. But I guess in the specific situation, when you're a surgeon and you're in the decision process, should I go forward or not? I guess I would be a bit afraid as a clinician to go into this DCD and organs that were previously rejected. So do you think this fear could mean that it will be sort of a slow adoption among clinicians or perhaps concentrated to a few centers where they have the abilities you discussed before?

Yes, I think you need to concentrate that activity definitely in the early phase of the introduction. I think in Belgium, we are doing this. We only have 7 transplant centers, which is actually already perhaps even a bit too much for an 11 million population. I must contradict you on the DCD.

Right.

Because in DCD, there is the opportunity. You can do it both ways. Either you take out the heart and preserve it on a machine or either you go to this new process of normal thermic regional perfusion, where you assess the organ function in the donor. So there are 2 ways to deal with DCDs. And in the second phase, you truly have a very good idea on the organ function. And so what we observed is that DCD donors, over the past 3 years, really did increase the amount of donors. So it did work.

I stand corrected. Thank you, Filip.

Yes.

Do we have any further questions from the audience? We have a couple of here. Let's start perhaps with Mattias, and then move forward to you, sir, with the red tie.

Mattias Häggblom from Handelsbanken. So 2 questions, please. Dr. Rega, you showed data that most clinics does 10 to 19 heart transplants per year, while you're cited 30. What's the correlation between long-term outcome for the transplanted heart and number of transplants per year hospital do? And then maybe for Johan. How many of the transplant clinics do lung, heart, kidney and liver transplants? Or to what extent are they focused on one of these? I'm trying to understand cross synergies here between the different organs.

I'll repeat the question. So the first is about the correlation between the number of transplants and outcome, if I get it, and then overlap between different transplant areas.

That's a dangerous question to answer. And we're not allowed to answer that in Belgium, because centers are afraid that if we look to their outcome and really compare them, you might find a correlation. But intuitively, you're right, and there is a correlation between activity and outcome. The more you do it, the better your outcome is. So -- but I cannot give you numbers on that.

All right. And then we had one more question, please. Step forward from Mattias.

Yes. So just 2 questions, Professor Rega. First on maybe your perspective on the TransMedic OCS device and maybe some of the reservations that have emerged from the Adcom, your perspective would be very much valued. And the second question would be on maybe how the pathophysiology of patients changing with cardiovascular disease, hypertension? These kinds of things interplay with warm and cold perfusion and oxygenation, that being important with these patients being on health care going forward.

Right. So 2 sections. A comment on TransMedics; and second, the demographic change with sort of decreasing physical status among the population affects perhaps the supply of possible donor organs.

In our center, we never implemented the OCS technology. If you read carefully the editorial on the famous Lancet paper, one of the observations we made was that they described that 5 patients were not taken into account into the final analysis because something, I'm not going to say went wrong, but did happen in the process of putting the heart on the OCS device. If you take them into account, then actually, I'm not sure that in that trial, non-inferiority was proven. So -- and that made us a bit skeptic. And actually, for heart, I think cold perfusion -- conditioned cold perfusion is for us the way to go. The second question was?

Demographics among donors.

Yes. Demographics. So they are changing these demographics. Patients indeed become older, become more diabetic and medication improves. Yes, we see the number of patients in end-stage heart failure increasing. And probably also there, this will extend the limits we implement now. For example, age. Up to now, there is an age limit that comes close to 70 years for -- to be listed on the heart transplant list. But sometimes, there is the 72-year-old person that 4 weeks ago did climb the Mont Ventoux in the South of France, yes? So a very healthy person. Do you not put some -- such a person on the waiting list? So these questions become reality. So we will push the limits in the future.

Great. I'd like that you pulled in some cycling references here in the Q&A as well. There are several questions from the online audience regarding TransMedics. So perhaps some other from the panel could add a little bit of flavor on the competitive landscape. Do you see them as a direct competitor? Or is it more like a difference in procedure and efficiency that -- so I don't know if anyone else could pick up on the TransMedics issue.

Maybe I can give it a try. I think it's, for many reasons, 2 different technologies. It's 1 technology relying on a warm and beating heart during transport, and the other one is with a cold heart but being perfused with oxygen during the transport. And yes, the evaluation and possibilities with a resting heart might be smaller, but it's also another layer of safety. So imagine that you have something happening during the transport with a beating heart. You have ischemia and it's injury to the heart from the first to second. So -- and with the cold heart, you have a layer of safety in the worst case scenario, perfusion stops, for example. You just revert to what we have today, cold state storage on ice. So that, I think, it's a big difference between the 2 technologies.

That sounds very -- like a very significant aspect of it because, obviously, risk minimization must be top of mind in this area. Johan, [ Onijeros ] from Redeye has a question as well, and it regards the time horizon for liver and FDA submission. And he wonders what's holding you back from setting this now. Perhaps, Johan, would you care to pick up on that?

The only thing, I mean, I can give a very brief answer is that we are in the preparation phase for submission. So until then, it's difficult to give an exact answer or expectation. So it's not -- we are not being held up ourselves. We're working on this.

We have another question from the online audience, which is interesting for as a layman. I mean, given the very nice clinical results you've shown with -- for instance, almost the graft rejection was almost halved in the liver right study or was -- yes. So [ Joe Wang ] from [ Duforth ] Investment Partners would like to know if you could elaborate on the potential use of warm perfusion and cold oxygenated perfusion in terms of treatment and repair of organs as opposed to only to storage and evaluation. Is that sort of a possible application that you could treat an organ before transplant?

Yes, of course. So what the situation now is that we come from 50, 60 years of statical storage. And we are now changing that into an improved preservation with our cold oxygenated machine perfusion. Now that we have proven that we can do that, the next step was the evaluation. So we increased the temperature. And by that, we could evaluate the organ to see if it's suitable or not suitable to be transplanted. And then indeed, the next step is, of course, well, if we don't say that it's not suitable for transplantation, can we do something about it? And then you come in the area of treatment. And yes, that's not yet clinically applicable, I tell you. But that is, of course, a very interesting research topic for the future. Yes.

Yes. So maybe a future development. Please raise your hand if you have any questions, and we will take them. We have 2 minutes more. Professor Rega -- Filip, sorry. You sounded quite optimistic when in terms of the possibility to prolong the viability of an organ to the 24-hour range or perhaps even beyond. Is there like a cutoff point in -- when you do this evaluation? I mean we saw the ischemic curves with the hazard ratio, how it changes or also with regards to the donor qualities. So what's sort of an acceptable range? Is 7, 8 hours, for instance, would that fall within the tolerances? Do you think -- still awaiting clinical data, of course, but your feeling for this.

To be honest, at this point, we cannot give you that number because within the EU trial, actually, we will be dealing with standard preservation intervals. So we know those data from experimental data, but also from the -- what the Australian centers are doing with these long-term preservations up to 7 hours. And what I recall mentioning these colleagues is that, look, these hearts come off cardiopulmonary bypass without important inotropic heart-stimulating medication. And that to me is extremely promising when it comes to long-term preservation and the outcome. But I cannot give you a number at this point.

Yes. Yes. No, no, I understand. But I suppose there is like a cutoff. But because we saw the regional map, 4 hours, you cover a certain region. If you go bump it up to 6 hours, it's a considerably larger area. So I suppose you don't need perhaps to go to 24 hours to capture a very large portion of the benefits. Because if you go to 6, 8 hours, maybe the coverage is so big that you have a very efficient matching of donor and recipient even at that number.

I can only answer in a sort of emotional way. So what happens now is that you cannot imagine how much phone calls there are between the transplant coordinator in the donor center and the recipient team to optimally match the timing and to keep the preservation interval as short as possible. By simply doubling the current preservation intervals, you relax that whole process. And probably, we will allow everyone to -- allow the hearts to perform better after transplantation.

Right. Thank you very much, Filip. Unfortunately, that's all the time we have for this Q&A section. So it's time for a short break. Please join us again in 15 minutes. Thank you. [Break]

Welcome back to Gothenburg and the final section of XVIVO's Capital Markets Day 2021. In this section, we will look a little bit in depth at the current core business, which is in lungs. And then we will have a glimpse into the future of transplantations. And to make it even more exciting, we will have 2 presenters with us on Link. But first off is Sales Director for North America, Rodney Jones, welcome.

Thank you, Lars. And thank you for this opportunity to present here today. I want to apologize in advance. All the eloquent speakers have already given you their stories and now at the end of the day, you're forced to listen to me. But nonetheless, I'll do my best. Some of the key highlights that I want to make sure that we cover and when I say we, it'll be myself and my colleague in the U.S., Brandi Zofkie, to talk about trends and innovation in lung transplant and where we're going for that. So just some highlights to start to frame this picture. Globally, there's about 6,700 lung transplants. And you've already heard multiple times today that's only 20% utilization rate. Globally, again, there's about 250 lung transplant centers. And those challenges are how to grow their programs, how to eliminate deaths on the waiting list and how to optimize the use of suboptimal organs. And through that, we'll talk a little bit about our products, what we're using or what the industry is using Perfadex and specifically for cold static storage and then for EVLP of course, is the XPS platform with STEEN Solution. So again, when there were some really good questions about the use of DCD donors and brain-dead donors and how that happens and why we see growth in 1 particular area versus another area. And so right now, the standard of care has been since 1969 when the Harvard brain death criteria came out and organ donation moved from -- it's actually we're going back to the future, moved from donation after circulatory death to brain death. That's been the standard. And so through that, all of the injuries that happen to the thoracic organs, especially during brain death and herniation have led to this 20% utilization rate. When we go back and look now at donation after cardiac death or circulatory death, we believe that by taking advantage of this with our technology that we can move up to 40% for the number of lungs transplanted. And when you think about that, especially for me, when I think about it in the U.S., where I'm from, going from 2,700 lung transplants to almost 5,000 -- a little over -- close to 6,000 transplants, that's pretty significant. And when you think about our purpose at XVIVO that nobody should die waiting for a new organ, I think we have a good chance of achieving that, being able to bump that up. And so that's fantastic for me that we would have that opportunity to eliminate deaths on the waiting list. So XPS, the XVIVO Perfusion System for warm machine perfusion with lungs and STEEN. That was started in a clinical trial in the United States in 2014. And in April of 2019, we received our FDA approval for that. We were the first company to receive FDA approval for warm machine perfusion for marginal criteria lungs. And so that's how we're expanding the donor pool now. One of the earlier questions, it was behind me, I didn't see who asked it was about the -- how about the penetration, EVLP penetration and actually the questionnaire used a term that I have been using that are we close to the tipping point and what would that tipping point look like? And I do think we're close to that. I think COVID pushed us back a little bit, but now we're getting closer to that as we move forward. And I'm going to give you some examples of how that penetration is growing and how we -- I believe that we are getting closer to that tipping point. As I go through the next -- just a few slides here. So again, this is information you've seen several times today. We're talking about steady but predictable growth of lungs transplanted. But then if we look at the opportunity within the DCD community, what does that really look like and the potential of expanding the donor pool through that. And I just have a couple of slides that I want to share some really novel examples of how that's happening. So this first slide, this is 1 of our key partners. This is from Toronto. They're a key partner for us in North America. Professor Shaf Keshavjee that runs the Toronto Group, is really along with Professor Steen, another pioneer in EVLP. And so they took a look at a population of donors called controlled donation after cardiac deaths, and these are donors that have a terminal illness, right? And that donor, along with their family and their caregivers have elected to move toward end-of-life care. And so they evaluated those patients to see if they would be potential lung donors with consent of the donor and/or the family. And at the time of death when these patients died, 14 of those candidates were put on EVLP. So 14 sets of lungs you can see from this paper that 5 of those 14 ended up going to transplant. Now it's worth noting when this paper was published, then we were talking about prolonged ischemic times. But 1 of these patients was up to 13 hours, right, ischemic time. So we're talking about a completely different population of patients, adding those to the donor pools and then thereby also increasing the number of transplants that can happen. And you can see these were marginal lungs. These have never been pursued before. And now with these 5 transplants in this small feasibility study, there was 0 PGD at 72 hours. There was no 30-day mortality, and there was an 80% survival rate at 1 year. So this is just fantastic. Another indication that we're getting close to the tipping point is the number of articles that have been published over the recent years. Specifically, in 2019, there were 2 really key articles, 1 out of Toronto, but another 1 out of Japan. That article out of Japan was a metadata analysis that looked at EVLPs around the world. I think close to 800 cases. And those -- it was found that this is 10 years out now that these patients who have received transplants from marginal criteria lungs that otherwise would not have been transplanted, underwent EVLP had outcomes that were not statistically different than a standard criteria lung transplant. Again, this is really great data. These papers that keep coming out this way are really good indications that we're getting very close to this becoming a standard of care. And then something more recently that's taking place right now is something we're all familiar with, that we've been living through for the past 18 months, is COVID. You heard a little bit earlier, Dag talked about 1 of our partner sites, the Cleveland Clinic. When they started using our technology in 2016, 1% of their transplants came through EVLP. During COVID, they were actually able to use our technology to increase their numbers. Now this is only 1 of 4 centers that does over 100 transplants a year. So they're a high-performing center and 25% of their transplants now are coming through EVLP. And 1 point of this conclusion in this article that I just want to draw your attention to was the last sentence in here, where they conclude in the future these newer EVLP indications may be applicable beyond COVID-19. So this is great. These are forward-looking thinkers, high utilization, high impact centers that are going to help drive EVLP forward. And then when we talk about innovation, this absolutely has nothing directly to do with transplant. And these 2 examples, I'm talking about our lung platform, but actually preclinical drug discovery is a fantastic opportunity for all of our platforms for our kidney platform and our liver platform as well. And when we look at the preclinical drug discovery market, the CRO market, it's projected to be -- have a growth rate of anywhere between $6 billion and $8 billion. And so if you can think about this, taking a new compound and testing it on an organ to determine its safety and efficacy before giving it to a patient and actually potentially harming them in a Phase I clinical trial, that is a big deal. And so that's just another opportunity for us to look at as we go forward. It's not our key area, obviously, transplantation is what we're all about, but this is just another opportunity to leverage our platform for the good of humanity. And so my last takeaways before I introduce Brandi are the following 3 points: EVLP is safe and efficacious way to increase the number of life-saving transplants; the pandemic has demonstrated that there are potential new indications for EVLP; and EVLP growth is trending upward and is a standard of practice in high-performing transplant centers. And as we talk about high-performing centers, it's a perfect segue into our next speaker, Brandi Zofkie. It's my pleasure to introduce Brandi. She's the Director of Lung Bioengineering. And Brandi and her team are truly transforming the way traditional EVLP has been practiced. And so I'm excited to hear Brandi's story.

Good morning.

Great. Yes, go ahead, Brandi.

Excellent. Well, thank you for the very kind introduction. Rodney. It's good to be here. As Rodney mentioned, I'm the Director of Lung Bioengineering here in the United States, and we'll be talking to you today about our model in which we utilize XVIVO lung perfusion. So a little bit about Lung Bioengineering and how we came to be. United Therapeutics is actually the parent company, and it was founded by our President, Martine Rothblatt. And at the time, Martine was actually the founder of what is now SiriusXM Radio. So you may be wondering how someone from the satellite community ended up in biotech. While unfortunately, at a very young age, her daughter was diagnosed with pulmonary arterial hypertension. And after creating a foundation to try to find a cure the researchers came back and said, listen, there's a drug sitting on a shelf that no 1 wants to develop because the cost is too high and the patient population is too small. So being [indiscernible], not taking no for an answer, she basically went back at her PhD and started United Therapeutics. But she didn't really stop there. So now we have 4 FDA-approved drugs on the market specific to pulmonary arterial hypertension. But that still wasn't a cure for these patients. So that's when Martine created Lung Biotechnology, which is the United States' first public benefit corporation of a biotech company. So something we're really proud of. And their mission is to create an endless supply of organs, 1 way or another. So we have multiple different modalities in which we're exploring being able to bring an endless supply of organs to patients. But then after a conversation about XVIVO lung perfusion, Martine partnered together to bring XVIVO lung perfusion to American transplant centers in a different way than it was being done before. One of the frustrations that was being related to Martine at the time was the resources that it took to do this within your own program and the expertise of evaluating a lung outside of body. So that's when she actually built our first facility in Silver Spring, Maryland at our headquarters, and we launched Lung Bioengineering to be able to provide an XVIVO lung perfusion service to multiple transplant centers. And everything that I'll be describing today is only available in the United States. So I just want to make sure everyone is aware of that. So Lung Bioengineering was founded as a way to be a service provider. So we actually have the devices in our facilities. We provide all of the staff and the resources to be able to bring that to the transplant center, knowing that it continued to be a challenge with the organ shortage as Rodney was describing to you. So Lung Bioengineering is using the XVIVO Perfusion system to fill the void between the number of organs available and being able to provide data and information back to the transplant team in order to make good decisions for their recipients. And the way that we do that is through our centralized service model. And that consists really of 4 main pillars: our facilities; our team of excellence; our FDA-approved device through the XVIVO platform; and the case management exchange that we use for data sharing and repository. So unlike most EVLP modalities, typically, you see these devices in a transplant center. But our process is a little bit different, where the organ has actually recovered at the donor hospital, cooled down, put on ice, on to 1 of our Lung Bioengineering facilities where it is put on EVLP. And then after the organ is accepted for transplant, is cooled back down, put back on ice, back on a plane to go back to the recipient hospital. So really, there are 7 benefits that we want to highlight in terms of what the centralized EVLP service looks like. Our robust experience, our flexibility that we can provide to our transplant center partners, the trustworthy data that we're able to obtain and share, the expansion of the donor pool, overall resource savings and risk management and our continuous logistical assistance. So in terms of our experience, we do have a lot of experience compared to some of the centers that are doing these smaller quantities per year because we are serving multiple transplant center partners. So as of this month, and actually, this number has already changed because we just did another 1 this morning in our Maryland facility, but we had 291 donor lungs coming into 1 of our 2 facilities, with 188 of those being accepted to transplant and translated into 191 patients. So the discrepancy there is that some of the doubles were split and went into 2 single recipients. But our experience of our team is really unmatched. We come with a lot of backgrounds in donation and transplantation and EVLP. And we do collaborate -- Rodney was mentioning the team in Toronto. And we do -- our training program is in collaboration with our Toronto fellows and we utilize their expertise and being able to train our heart team. Well another unique thing about us is, besides just our experience is that we're a 24/7 operations. So any day or a week, any holiday, middle of the night, we are available to our transplant center partners. On top of that, we have a different level of quality assurance that comes with having standard procedures and oversight from a regulatory perspective. Our service allows for optimized decision-making as well for our transplant center partners. If 1 of my colleagues actually coined the phrase of turning a no into a maybe. So now transplant surgeons, when they're assessing these organs, now have a way to be able to get more information and make better decisions for their recipients. The XPS platform allows for single or double lung EVLP, which is unique compared to some of the other devices on the market. EVLP allows for essentially scheduling of some of these transplant type procedures that are normally being done in the middle of the night because of the time the extended preservation comes with it, physicians are finding that they're able to plan appropriately and not have to do some of their procedures in the middle of the night. And even better, it results in some reduced travel because typically, thoracic teams would never have allowed another team to procure organs for them because if there was a mistake and they're not able to use it, that would be significantly impactful for the recipient. But now because of the EVLP technology, if they're allowing other teams to do the organ recovery, the longest sent to 1 of our facilities, they can be reassured by the data that we provide them and by our assessment that the lung is suitable to go into a patient. My slides kind of a stuck there. In terms of the data that we provide, not only are we providing the data, but we also have everything integrated to be able to view all of the data from their mobile device. So they could be at dinner with their families are lying in bed at night in preparation for a transplant and be able to see everything, including being able to remote into the actual procedure and discuss live in real time with our clinical team. On top of that, we have -- all of our facilities are outfitted with really amazing AV capabilities, and we also have medical consultants available that have expertise using STEEN-based EVLP technologies to be able to allow for peer-to-peer discussions that transplant centers new to the technology have definitely valued in their onboarding with our program. This is a little example of what our charting system looks like. So we collect a ton of data. On top of that, we're also collecting video feeds of bronchoscopies and overhead video, and we're collecting X-ray images, et cetera. And like I said, all of that is available to our customer at their fingertips. We also believe that working with Lung Bioengineering in a centralized model helps expand the donor pool. Now lungs that may not have been used before are able to be reassessed, gather data and consider organs from distant hospitals that may not have been considered before. Even better than that is that because our facilities have multiple EVLP procedure room, so we now have 2 centers with 4 XPS devices. It really ensures that business continuity that we will always be able to say yes when a customer calls a meeting, ex vivo lung perfusion services. And one of the things that I feel Lung Bioengineering is really tasked with is to change the culture of transplant programs. Before an intraoperative decline would not have been used. And with EVLP and with Lung Bioengineering being able to help facilitate additional time for data, these lungs can now be considered. DCDs, as you heard already multiple times today, very high potential to be able to use those organs. A double-lung perfusion where you're intending to perfuse the lungs for one patient and then find out that there's an issue with one, and only one can be transplanted and having to switch recipients. And then as I mentioned previously, utilizing other procurement teams for the recovery of that organ. As I mentioned, we have 2 facilities. Our flagship facility has 6 operating rooms and is located in Silver Spring, Maryland, and our second facility is where I'm calling you from today, down in Jacksonville, Florida, where we have 3 operating rooms. Our centralized model also results in reduced resource burden. So onboarding a device isn't just buying a device and using it. There's the cost of the personnel to run the device, all of the training and capital investment, the technical issues and the learning curve that comes with evaluating a lung outside of the body, the OR time, the consumables, et cetera. We feel that being able to provide all of this allows for the customers to not have to manage all of that themselves. In addition, we also feel that the increase that may result in the lungs reduces the overall burden to the transplant center by getting patients transplanted sooner. And then just overall and risk management, allowing physicians to have information that they didn't have before, especially when it comes to DCDs, especially when it comes to those organs being procured by another team when they actually don't have their hands on it, especially those organs where they're given very little notice, especially in the time of COVID, the American donor hospitals are -- some of them are really, really stressed. And they need to get the organs out so the ICU bed can be used again, unfortunately. So being able to facilitate the recovery of those organs and evaluate after their -- outside of the donor. And then even more importantly, and something I haven't touched on yet is the ability to reallocate organs. So a lot of times that these lungs go to a single transplant center. And for some reason, something would change with the recipient or -- so maybe the double lung recipient isn't available or can't be transplanted today. Typically, the way that works in the United States is just identifying another recipient within that transplant program. But with our services, we are able to help the organ procurement organization identify a transplant recipient that's next on the list that may actually be at another transplant program. And then continuous logistical assistance. So I touched on the facts that we have additional flights to get the organ from the donor hospital to Lung Bioengineering and from Lung Bioengineering back to the transplant center. Lung Bioengineering can actually assist the programs in facilitating all of those activities. So if somebody is not able to get a plane or ground transportation, Lung Bioengineering actually facilitates that as well. But more importantly is what we're doing we consider to be really just a platform for what the future looks like. Lung Bioengineering's goal is to fill the void and to provide a 360-degree service to transplant center partners. And whether that means an expansion of organ perfusion services, increasing the number of our facilities to be able to provide these services to transplant centers all across the United States, transport innovation and streamlining procurement services. We do feel that Lung Bioengineering is going to be the answer for all of the in between of getting the organ from the donor and into recipients. And with that, thank you so much for having me today. Looking forward...

Informative and interesting presentation. And we look forward to hear more from you during the Q&A session later on. However, now we move on to the future of transplantation, where the Chief Operating Officer, Christoffer Rosenblad, will present more about this. Welcome.

Thank you, Lars. And I wish you all welcome to the last, but certainly not the least, session of the day. Now it's time to take a sneak preview into what's around the corner. And together, we will explore new horizons in transplantation. Today, we will present 4 trends in transplantation going forward. The 2 first ones are -- will simplify the process for the transplant team and you heard one of them from Brandi. The 2 -- second or 3 and 4 will change how we look on transplantation and will increase the number of organs. But if we start with number one, which is digitalization, it's a trend that affects not only our industry, but it will affect our industry a lot more in the next couple of years. We can see that more information sharing, taking data-based decision-making and support the clinicians with data-based decision-making will continue to increase. We have press released a pilot in Groningen. And as Dag mentioned, there will be more pilots within this field in the next couple of months and years coming up. The second part, new business models, there will be coming into the market more business models, such as, for example, LBE, where you help the transplant team to actually focus on what they're best at, which is the transplant procedure, that's their core business. It could be third-party services, et cetera. We probably will see this development start in the U.S. and then go to the rest of the world. It will be definitely fueled by the AOPA 50,000 transplants in 2026 that will demand more services to support transplant team. If we look into the third trend we will discuss today is xenotransplantation. I won't go into that today because you will hear more about that very soon. But xenotransplantation is transplantation between animal species. I mean, the end goal of this is that to use in this model pig lungs on humans. And after that, we see a trend of bioprinting. It is today certainly science fiction, but if successful, it could eliminate the need for both immunosuppressants and eliminate shortage of organs. So it's -- if come true, it would be fantastic. During bioprinting, there will be a step of [indiscernible] where you would need machine perfusion. So on that note, in the field of xenotransplantation, even though it feels like science fiction today, certainly, that's what I feel, it could be just around the corner. Our next guest speaker calling in from the U.S. has been involved in the field of xeno since in 1992. He has made several contributions to the field of transplantation and xenotransplantation with over 120 publications and over 100 abstracts as well as numerous presentations. His group holds the record of longest-surviving xenograft in a large animal model. I'm both excited and humble, I must say, to introduce Professor Muhammad Mohiuddin from University of Maryland. The stage is yours.

Thank you very much for this introduction, and thank you for inviting me here. I'm very honored to be part of this meeting. I would like to first give you an idea that what xenotransplantation is and why do we need it. As of now, there are about 150,000 people waiting for an organ transplantation for -- of various organs. And unfortunately, most of them will die waiting. And there are other solutions like artificial heart or the left ventricular or right ventricular assist devices, which provide some relief, but still, they are not the cure. So my goal will be today to let you know how the XVIVO has helped us in progressing this field, which we think is very close to clinical translation, which it appears like that it's a science fiction for now and for many years, and -- but I certainly believe, and my group certainly believe, that we are right at the corner, and we are embarking on some studies that will lead us to clinical translation. So what is xenotransplantation? So xenotransplantation is transplanting a heart. I will just talk about the heart. So transplanting a heart from, once, the specie of animal to either another specie, or in our future directions, transplanting that heart from animal into a human. So I mean, it seems easy that you take a heart out from an animal, and in our case, the pig that we have chosen pig because we can easily change their genetic makeup because we know their entire genome. We can breed them in captivity. They grow in size very quickly. So within months, their heart size is the same as that of a human. So we don't have to wait for a long time to get it. And we know about all the -- or at least trying to know about all the diseases that can be transmitted from an animal to human. And for now, we know of only one virus that can be transmitted to the living cells. But so far, it has not shown to cause any disease. And with genetic engineering, there is a possibility of completely knocking out the genome of that virus. So in other words, this process will be very safe. Okay. So I mean, it seems simple that you take out the heart from one animal and put it in another, and it will function. But what we encountered in our earlier days is that this is a heart that we transplanted from a pig into a baboon in the abdomen. His original heart was intact. So when this heart rejects, the baboon doesn't die only the heart rejects. So what happens is that within minutes, this heart turns into this. So -- and this is called hyperacute rejection. It's a phenomena you will not see in the allograft, means from human to human or from one -- the same specie to -- heart transfer from one, like baboon to baboon or pig to pig. This is only seen in xenotransplant, and it's because all humans and all baboons, which are old-world primates, they have certain antibodies that recognizes the carbohydrate antigen on the surface endothelium of the heart. And then attack it and immediately cause the heart vessels to clot like this. And this is the histology from the same heart. As you can see, the major vessels are completely clot. And this is why this heart rejects. This phenomenon is very different from the allograft rejection, which is mostly cell mediated. It progresses over a period of time, and you get rejection after a few days or months or years. But in this case, if you put an unmanipulated heart in a baboon or a human, it rejects immediately. And this is -- the other characteristic features are the loss of [indiscernible], intravascular hemorrhage and all that. So we have shown that in the abdominal model that I've just shown to you, we were able to prolong the graft for almost 3 years by acting on 2 fronts. First, we genetically modified the pig and took out all the antigens that were immunogenic to humans or the baboon. And then we are -- on the other hand, we used some target-specific immunosuppression, which is sparing the generalized immunosuppression and helping the recipient combat other infections also. So when we had this kind of survival for almost 3 years, there was a proof-of-concept that we can avoid xenograft rejection from minutes now to over 3 years. I should mention that the grafts after 3 years only rejected when we withdrew the immunosuppression, thinking that we have induced tolerance in these animals. So -- which we found out that we cannot do. So that therapy is based mostly on the use of costimulation blockade, which helps suppressing the B-cell response and also the T-cell response. So when we had this success, the natural transition was to do the heart transplantation in its original place, which is in the chest. So this is what we are doing for the last 4, 5 years before I was at the NIH and now at University of Maryland. And in this experiment, we are using these genetically-engineered pigs, and we are taking the heart out, and we are transplanting it into the baboon, which is being treated with the same immunosuppression that we used in the other model. So can I have the first video, please? So here, you see that a freshly transplanted heart that has been transplanted and is beating very well. So all the technical issues and everything, we have not faced, we were able to transplant it just like we do in humans. Next video, please? So in this slide, this is an echocardiogram that transesophageal echo that shows their heart when we transplanted. And it came off the bypass. It was functioning very well. But -- next video, please. But within 5 hours to 48 hours, this heart kind of give up, and it dies on us. When we looked at the histology of this graft, we saw that this heart did not go -- undergo rejection, but it simply failed somehow. And we were very confused at what's going on. But there comes the role of XVIVO and the STEEN Solution. So one of our collaborators from Germany, Dr. Bruno Reichart and his group demonstrated that when they use the old STEEN Box and the STEEN Solution, they can overcome this rejection, not rejection, the failure of heart within 48 hours. We have termed that phase as PCXD, that means perioperative cardiac transplant dysfunction. So that -- for our initial period, we lost several animals just because of that. But then we transitioned to this procedure, where we take the heart out, we perfuse it with the STEEN -- with the XVIVO Heart Solution and put it in the XVIVO Heart Box from 1 to 2 hours. Then we do the transplant, and then we monitor. So what we did was we compared 3 different methods of cardioplegia that is stopping the heart and also preservation. So in the first method, it was traditional cardioplegia that was used in our transplantation, and the same cardioplegia solutions were used. In the second method, we used the same cardioplegia but added blood to that cardioplegia solution. And in the third group, we used the XVIVO cardiac perfusion and using the XVIVO Heart Solution as the cardioplegic solution and with the addition of blood. So here are some of the agents that we had to use when we were struggling. We had to use inotropic support to support the heart. And also we had to use different vasopressors to help the heart get enough blood to pump out. And we graded them based on their use into their 5 different groups. And here, you see that we -- though there were like multiple genetic modifications done to the animal. And I don't want to go into the details, which will take over an hour to explain what all these genetics are. Basically, these genetics are to knock out all the immune targets that are immunogenic to humans and also to express some human molecules that will facilitate keeping the blood flowing in the vessels. So there were 3 groups. In the first group, as I explained, was crystalloid cardioplegia with preservation; the second one, we used -- added blood; and the third one was with the STEEN Solution, with the XVIVO Heart Solution. So here's the difference. So if you see that in the traditional one, we were not able to extubate any of these hearts. We lost them within 48 hours, and we had to give a lot of help, but -- and their lactate increased immediately. Their base deficit was abnormal. So we spent nights and days just trying to correct it, but ultimately, there was failure. With blood cardioplegia, we were able to survive them a little better. But again, not all of them survived. But finally, when we start using the nonischemic cardiac perfusion through XVIVO STEEN, XVIVO Box and XVIVO Heart Solution, we were able to survive all these hearts. Now since we have started using this box, we have not lost any animal to the PCXD within 48 hours. So here are some more results that you -- there are 3 groups, the same groups that I've described. As you can see that in the group that where we used the XVIVO Heart Box and the XVIVO Heart Solution, we were able to -- these are the animals that required minimal support, and there was very little inotropic support required and a very small amount of vasopressors that were required. And I'm happy to report in the recent transplants, we are not giving any of this. And these are hearts we are explanting, and they are not requiring any of this support. So that, I'll credit to the XVIVO Heart System. So here also, the -- as I mentioned, there were some acid-base derangements. We used to see, and we spent a long time fighting it. But as you see in the green ones that the lactate was very minimal. The base deficit also was very little. And the pH, that was more physiological in that case with the XVIVO Heart Solution. So here's the difference. So the right line shows that when we were struggling and we were not using the XVIVO Heart Solution and the Heart Box, we were having such a great difficulty. And since we have started using, we have been able to survive the graft on a consistent basis. These animals are lost. These are animals. We have to manage them blindly because they cannot tell you if they are feeling pain, if they are having infection, but we have learned how to manage them. And then -- and we hope that when we transition to human, we won't have this problem because our human patient will tell us what he's going through. So this is, again, some of our grafts. And until this presentation, the longest-surviving graft was 6 months using the old STEEN Box from Professor Bruno's group from Germany. And they taught us how to overcome this PCXD. And now we are getting consistent survival over 6 months, as you can see here. I mean, this animal died just because there were some infectious complications in our facility, not related to the heart transplantation. So -- and this animal is still going on for a long period of time, and it's gone beyond 6 months. So I mean, now we are very confident that we can keep these hearts alive for a significant period of time, thanks to the XVIVO system. So just to conclude, the graft survival was minimal without -- with the conventional metrics of cardioplegia and preservation, and the PCXD, the failure within 48 hours was the main culprit. So all the transplant performed with the XVIVO Heart Solution and Heart Box overcame PCXD, almost 100%. Heart xeno and allograft after the nonischemic cardiac perfusion did not require any inotropic support and had almost no complication after extubation. In fact, we used to wait for a long time for extubating. Now we are extubating almost immediately, and these animals are doing fine. Now all our long-term graft survival utilize XVIVO Heart Box. And we are looking forward to use this in our human transplants that we intended to do. So I mean, I would also mention to you that in our plans, we have -- when the xenotransplantation goes to clinic, the hearts will be procured from -- at one center, which will be a GLP, [ DPS ] facility, and these hearts will be transported to the centers throughout the United States. And in that case, the XVIVO heart -- XVIVO Heart Box will play a very crucial role in transporting these hearts. We are about to do some pilot studies by harvesting hearts at our Blacksburg facility, which is 6-hour drive from us and then taking -- and putting the heart in and bringing it in and showing that the function is preserved. So with that, I would like to thank the team that we have built, which is a village, basically, all this work requires a support from a lot of people and a huge amount of investment for which I'm thankful to United Therapeutics and Lung Biotechnology and also National Institute of Health, who have provided us with the funding to do this experiment. With that, I would like to thank the audience for listening, and I'd be happy to answer any questions you have. Thank you very much. You can take over, please.

Thank you so much, Professor Mohiuddin. It's always a pleasure to listen to you, and it was a really impressive result you showed there. And I will short summarize this session in about a minute, and then please stay for a Q&A session. I'm pretty sure there are questions for you from the audience here. So to summarize the future of transplantation and key takeaways, as we heard many times, there is a shortage of organs for transplantation, which is a factor 1 to 10. So the need is 10x higher than the supply today. Machine profusion has proven to increase the number of transplantable organs. That is in clinical use today. Kidney and liver are soon awaiting regulatory proven in the U.S., but most of our machines are used today. So it works. We, at XVIVO, believe in a new business model, in innovation. For example, xenotransplantation, as we've seen here from Professor Mohiuddin will play a vital role to 1 day accomplish our vision. And that is that nobody should die waiting for a new organ. So with that, thank you so very much for listening.

Thank you very much, Christoffer and Professor Mohiuddin for excellent presentations. Now it's time for the Q&A session.

We have a general question from our online audience, which perhaps Dag could answer. It's from Johan Unnerus in Redeye. And he wonders, can we expect XVIVO to engage in additional support networks like LBE? Do you see more of that type of partnership?

You mean with the Maryland...

I think it's Lung Bioengineering.

Sorry, Lung Bioengineering. Absolutely. I mean, this is definitely one way of making life easier for customers. I mean, if -- working with perfusion hubs, it's, of course, very attractive, and Brandi gave a lot of examples of why there is a strong benefit for doing so. So -- and as Johan mentioned earlier, we are doing the same thing in the U.K. with [indiscernible], which will also be like a mini hub for a number of other transplant centers. So I think this is definitely one way forward to work and promote sort of the hub concept when it comes to perfusion. Yes.

Right. Thank you, Dag. We have more questions about Lung Bioengineering. So Brandi, obviously, you made a strong impact here. Peter Östling, analyst at Pareto Securities has a question for you. And he would like to talk a bit about the study that you're conducting, how it proceeds as it is an open-label study? The main goal of the study and the main endpoint is what? And secondly, are you planning to open additional evaluation centers in the U.S.? Did you get that, Brandi?

Yes, I did. Thank you for the question. And yes, we do actually have 2 different ways of doing ex vivo lung perfusion at Lung Bioengineering, we are conducting a clinical trial. But for the sake of today's conversation, we're going to stick with the topic of our XPS services, which are FDA-approved in the United States. And in terms of your question about our expansion, we definitely will be expanding west at some point. Right now, we're able to serve transplant center partners, primarily east of the Mississippi in the United States, but want to be able to provide access for patients all over the United States. So definitely see at least another facility or 2 to be able to meet needs of patients across the States.

Right. You have another question, Brandi, and it comes from Jue Huang from Viewforth Investment Partners. And she wonders if you could talk a bit about the barriers to scale. What's the main hurdle for you? Is it the CapEx perhaps or something like that? And there's another TransMedic question here as well. They're building their national service program. Have you seen them making any progress?

Yes. So the first question was for scaling for being able to provide this service across the U.S., is that correct?

Yes.

Okay. Thank you for clarifying. So we do have some challenges ahead of us. And I think one of the biggest challenges is convincing and trying to change transplant center culture. So for the last 20 years, organs and lungs especially have been assessed in one way. And that is from a piece of paper, basically getting some data from the donor in the ICU on a ventilator with a closed chest with all other organ systems basically having to be monitored at the same time. So for those of you that may not be aware, one of the biggest battles in organ donation, when you're managing a donor patient is trying to find a balance to protecting the lungs, which want to be a dryer organ and also hydrating the abdominal organs with the kidneys needing a lot of fluid. So a lot of these patients end up fluid overloaded. And traditionally, when a patient has that fluid overload, or if there's any question whatsoever about the quality of the lungs, the transplant team historically would decline. So I think one of our biggest barriers as we scale up is really making sure that transplant surgeons, transplant pulmonologists understand what opportunities they have to now change their program's mindset. To take it -- to look at an organ and not make a decision about that organ, not decline that organ until you see it on the EVLP circuit. Get the information you need to confirm that, that organ maybe is that. We would much rather see an organ fail on EVLP than not have any chance of being transplanted. So I think that is definitely one of our biggest barriers.

Thank you, Brandi.

I'm sorry. The second question was TransMedics?

Yes. Now let's see.

Their service model.

Yes, it's about the service model. No, actually, it was about TransMedics competitor here in some way. And Jue Huang wonders, they're expanding their service program. Have you seen them making any progress? I mean, I don't know if that's a relevant question for you to answer. So you decide, Brandi.

Yes. I mean, we are aware of that. And -- but we feel that there's a different need for our services versus what they're trying to do.

Thank you. Obviously, you're very successful, Brandi. And Peter Östling at Pareto Securities has a question to XVIVO. Lung Bio managed to use 188 of 291 lungs, which is a 65% utilization rate. XVIVO is aiming for 20% to 40%. So why not aim higher if Lung Bio can do it? Can you?

So that's actually -- oh, sorry, Dag, did you want that?

No. I mean, I think it's an excellent performance Lung Bioengineering has. And as I mentioned, earlier, Brandi as well in the case of Cleveland, as I also mentioned, they have more or less a 70% success rate when utilizing EVLP technology. So the question is, why are we not promoting a higher percentage than, let's say, the 40% -- maybe 50% that we are promoting? We are a little bit modest. We know that proof lies in the pudding many times, and people who use our technology, like Brandi and Cleveland, they see the benefit of EVLP technology. To make statistical claims on exact percentages is, of course, not easy, not here. I don't know...

I just want to make sure that the questioner understands that 40% isn't the conversion rate from lungs on EVLP going to transplant, that 40% is from the donor pool, right? So that's a different statistic.

Yes. Absolutely.

Just to add to that, I actually feel that our conversion rate is too good because that means transplant centers aren't taking enough risk to evaluate organs. They should be pushing organs in that aren't going on to be transplanted because there's still that large pool.

Thank you, Brandi. Are there any questions from the audience? Yes, please wait for the microphone.

My name is [ Stephanie Tigerschiöld ]. I'm a private investor. And I wonder when you evaluate lungs, for example, bioengineering, how many of the evaluation aspects that you're looking at are objective and how many are subjective? Because that's a really important question whether the teams on the spot in the hospital are using mostly subjective analysis.

Right. Any one of you in the panel who feels an urge to answer this question?

So if we look at all the objective criteria for the XPS machine, for an example, I think it's close to 22 data points. And then the subjective would be a drop test where you disconnect the ventilator and you watch basically the symmetry of the lung as they collapse. But outside of that and how the lungs feel, what we've done to mitigate some of that, especially how the lungs feel is with the addition of weight scale, right? So we are working hard to make some changes -- to make it more objective, but there -- I would say -- and Brandi, correct me if I'm wrong, the drop test and the way the lungs feel are pretty much the subjective parts now. Everything else is fairly objective.

Any further questions from the audience? Yes, we have one here.

Ulrik Trattner, Carnegie. First one addressing you again, Brandi, and just probably curiosity, how many transplantations does your partnering clinics or centers do per annum? And as well, do you have any data on in terms of success rates on graft survival in comparison to sort of the general transplantation centers out there?

We actually have a wide variety of transplant center customers, some that are doing in the 20 numbers of transplants a year versus our big partners that are doing over 100. So we do have a lot of variability. And interestingly, the smaller customers have actually been the ones that have really owned the technology surprisingly to us because of the advantages that it provides to our program. And the second part of your question was about data and survival. So because we just launched our XPS program, it's still too early to say. We are definitely working with XVIVO to keep track of that about what our experience looks like in using the XPS device.

Thank you. We have a question for Professor Mohiuddin from our online viewers. Neal Beswick from Transplant Genomics has a question. And he would like to know what would be a major trigger to enable human clinical studies using a xeno organ? And how far out is this?

So thank you for your question. This is a valid question. So avoiding the xenograft rejection was the main thing that we have, I think, have achieved and we have survival up to like 6 months. So our next goal is to have survival enough to provide this technology as a bridge to transplantation. So for people who are waiting on xeno for -- waiting for a human organ, they have to wait maybe like 2 to 3 months before an organ is available. So the first step into clinic will be providing this technology as a bridge. They get this organ, which will not reject within 3 months, for sure. And once the human organ is available, then we will do it. But in future, we want to extend it and make it as a destination therapy, which means that using it as an organ forever. The advantages are with the genetic modifications, which you can customize this organ. But at this time, we are sticking to about like 10 genes that we have modified, and we think that this is enough to use in the human for the bridge transplantations.

Right. And a clarification, of course, human studies is the first step, and then it would be quite a long path, I assume, moving into a stage where it can be used on a sort of wider scale as part of the transplant health care services provided. It's a tough question, but do you have any idea how long that sort of regulatory journey would take?

So we are in a process of conversation with FDA. So the first step is for them to allow us to enter the human field, right? So they may -- the results that we have may not be enough, or they may require certain more pieces of information. Of course, the biggest concern our regulatory agencies have is the transmission of porcine diseases to human, even the ones that are dormant in the pigs but may infect humans. So far, there is no such study that demonstrates that. But still, once we do the transplants, we will have to monitor these patients for a long period of time and the tissue that's preserved over a period of time. So that's why the concern -- until we alleviate this concern, the human studies will be a little difficult to do. But I think that we have enough answers for the FDA for it to allow us to go forward.

Thank you. And Professor Mohiuddin, out of curiosity, we've seen impressive data on sort of graft survival and so forth. Have you measured performance as well? I mean compared to the baboon's original heart? Is it able to perform as a normal ape? Or is the pig heart in some way inferior or limiting to its way of life?

I mean for 6 months to 9 months that our baboons are living so far, they are doing very well. I mean they don't even -- I mean, I don't know how they feel because their heart is different. But otherwise, they are still behaving like baboons. I mean they are not doing oink oink because of the pig heart. But -- and their functions, yes, the pig blood pressure and heart rate is a little bit higher than the original baboon heart. So -- but over a period of time, there, we have seen that, that is not a factor in the survival of the heart, and it doesn't affect the animal that much. So -- but we believe that, that difference will not be there when we do the pig-to-human transplant.

Right. So perhaps it's not too far-fetched to assume that quality of life for a human recipient would be pretty good? Of course, it's...

Pretty good. Yes.

And another...

I would like to add that in xenotransplantation, you'll be transplanting a very healthy heart compared to the heart that we get in allotransplantation, which are from diseased donors, right? So they have their diseases to come with it. So these are bred pigs in a controlled environment with a very healthy heart. So this will provide an additive advantage to them.

All right. It's very interesting. Another question to you, Professor from Jue Huang from Viewforth. How do you determine the most appropriate recipient group to receive xeno versus a traditional transplant?

Yes. So there are several groups that we are targeting. So there are some diseases where the heart function, heart contractility is limited. And even the -- if you put that ventricular assist device, it's not able to contract that heart. So these are -- these will be our first candidates who will -- who don't have an alternative like LVAD or any other assist device. So -- and also kids, as you know, that in kids, there is a great need of heart transplantation. And we think that the they are -- when we transplant in kids, the immunity is still developing, and their immune system is still developing, and they can overcome the other barriers that we have left in transplant rejection. So we may be able to induce even longer-term survival in that case.

Thank you very much, Professor. Brandi, we have a question to you from our online audience. Johan Unnerus of Redeye wonders, is your experience that smaller centers are more ready to review the traditional attitudes and procedures? Or is it more evenly spread among clinics you work with?

There's definitely variability. It's really what the program wants. Does the program want to grow? Does the program want to change? Or are they looking to maintain their status quo? So when you've seen one transplant center in the United States, you've seen one transplant center. As Rodney said, we do have places like Cleveland clinic that are a partner that we have seen -- they do a huge amount, and we have seen them change even their practices. But we definitely know that with struggling resources, the transplant centers that are smaller definitely do have an advantage to utilize the technology to leverage, utilizing someone else to procure the organ for them and to take these organs that they may not have been able to go after themselves because of having to send someone to do that procurement and being able to leverage the technology. So there's definitely both ends of the spectrum when it comes to who is using it the most.

Thank you very much. Rodney, I believe, in one of your slides, you showed that utilization rate of one of your sensors for EVLP had risen from 1% to 25%, 2016 to 2020. So is there an upper limit, like 30%, 40%?

Yes. So there's -- the answer is there's not another limit. As an example, Toronto, the largest transplant center in the world, 200 lung transplants in 2019, 50% of their lung transplants were from EVLP, right? So it could -- I don't think there's another limit. Yes.

So I guess, it shows the potential because overall market utilization rate is considerably lower, right, than this?

Correct.

Maybe this is the question -- maybe Dag, earlier, we ran out of time. So I was just wondering, considering the COVID pandemic, has that, in any way, impacted patient recruitment? I mean the clinical studies are very important now. So do you think you can stay on your time line, even though we have these current problems?

You will always have -- I mean, there have been problems related to COVID and intensive care unit capacity. Typically, what we have seen is that it doesn't happen at the same time in all countries. I mean, when, for example, in 2020, it was U.S.A that sort of came -- ended in the pandemic a little bit before the European -- most of the European countries. So they sort of slowed down last year and then they picked up again, and we had a very strong first half in the U.S. this year. Then, of course, when you get variance, I mean you get weeks of issues in certain hospitals, in certain countries. But the need for transplants, you have seen it, and we've heard of -- we've talked about it all day, over time, the number of transplant has to go up. But we have to also accept and realize that not all countries will develop in the same strong way in parallel at all times. That's a fact.

It was inspiring to see Brandi's presentation on how Lung Bioengineering could sort of expand into new service layers continuously. And Christoffer, you talked about new business models earlier when you talked about the future. So can you see XVIVO doing the same journey or a similar one as to, let's say, Lung Bioengineering following that example, adding service layers to your [indiscernible]?

I mean, we were looking to adding service layers. I mean Lung Bioengineering is a partner, and we want to partner up with the best companies in the world because we share the same vision as Lung Bioengineering, and then we can together accomplish great things.

Right. Now this is about evaluation of lungs. So looking at, for instance, the abdominal area, it's a little bit more of a logistics solution. But can you see a similar opportunity there to sort of provide services as well in addition to the machines? Or perhaps that should be an external partner?

Yes. I mean there are opportunities already now in certain European countries. For example, in Italy, just to give you an example, we cooperate with a company called Avionord, who provides perfusion services, centralized perfusion services for certain organs there. So I'm sure that model will be developed. And I think it's a very, very good model because not all hospitals, not all centers are equipped and resourced. There is also a shortage of perfusionists in many countries around the world. So I think centralized services, when there is a center of excellence, I think that concept will grow and develop, definitely. I think what Lung Bioengineering has accomplished in the U.S., which is a fantastic journey they have had, there will be similar initiatives, I guess, also in Europe and other parts of the world. Yes.

Right. And then I suppose XVIVO will be part of that journey?

Absolutely. I can promise you that, Lars.

Do we have a final question from the audience? And if not, we're out of time. So I would like to say a big thank you to all the presenters. And also thank you to all of you who have been with us today online. And of course, those of you who are here. We've learned a lot. There are lots of market opportunities. Pigs have strong hearts, and I hope you can digest all of this information. And if there's anything you would like to know or delve into, remember that you can always look at the presentations later on as well. Having said that, thank you very much from me. And now Dag will wrap up today's lessons and summarize. Welcome, Dag.

So time to wrap up. Time flies when you're having fun. I hope you have all enjoyed this quite lengthy session. But since it is our first Capital Markets Day, we wanted to give you a lot of insight into the company. Before summarizing, I just wanted to conclude a little bit on what Christoffer Rosenblad just presented together with Dr. Mohiuddin on xeno. I mean there is a race between 2 sites in the world right now when it comes to xenotransplantation. I don't think he's listening right now. But anyway, there is one in Maryland, and there is one in Munich. The one in Munich is headed by Dr. Professor Reichart, who actually succeeded Dr. Christiaan Barnard, in Cape Town, who was the first person to perform a heart transplant. So Professor Reichart, Bruno Reichart, is doing the same thing, as you saw from Maryland. So the question is, who is going to win? And Professor Reichart believes that next year, there will be the first transplant from pig to human being. Let's see if that is right. And they are both using our technology, and they can't do the work without our technology. This is fantastic. So we are probably going to be part of something which is totally game-changing for the world. So just to summarize today's presentation, I mean, we live in a world with an extreme shortage of organs. I hope you're all signing up as donors after this Capital Markets Day. I mean, demographics, chronic diseases, lifestyle, all of these leads to an increasing need of organs. So the focus must be on increasing the number of organs available. In England, organ donation law has changed quite recently. Since 2020, all adults in England are now considered to have agreed to be a donor when they die unless they have recorded a decision not to donate or are in one of the excluded groups. Other countries with opt-out programs include Argentina, Chile, Colombia, Spain, Austria and Belgium. And looking to the example of Spain, which is actually the most successful transplant country in the world, more organs are donated and transplanted in Spain in relative terms than in any other country in the world. They have adopted a presumed consent donation system. So intensive care units in Spain must be equipped with enough doctors to maximize the recognition of potential donors and maintain organs while families are consulting for donation. So things are happening around the world, and this will lead to more organs available. On the supply side, the focus has to be on the utilization of organs. I think you've listened today and understood why there is an issue when it comes to utilization of organs. And we all know that machine perfusion is a great enabler to drive utilization. We have a unique product range, and we will be relentless in executing our strategic focus areas. And I will consistently chase my team members and organization to execute and deliver. That is something I have promised them. So at the end of the day, all of us go to work at XVIVO. Because of people like we are, nobody should die waiting for a new organ. And with these last words, I would also like to say thank you to Lars Frick for being an excellent moderator. And now I'm going to test you, Lars, and you can give me the answer later on tonight. Once upon a time, you said something which I found truly great. Maybe remember when, and in what context. [Foreign Language] Promise around and keep thin. This is something that we as a company will never do. What we focus on will be delivered, will be executed. You can all count on that. And thank you for participating in today's Capital Markets Day. Thank you all.