They are in far more than one hospital in Germany. In the Q4 call Dr. Chan mentioned that one hospital in Germany was the first to surpass one million in annual sales. That is 1000 cartridges sold to a single institution. To me, 1000 says it is way more than an few physicians evaluating a new product. It is wide adoption across the hospital. Specifically, he stated "we are able to publicly disclose that we have a number of large accounts that are moving towards this milestone and have already now achieved one of those customers that have had more than $1 million"
This was to support his frequently stated potential annual sales in Germany of 400 million to 1.2 billion for critical care applications. That comes from 400 German hospitals that have 400+ beds buying 1-3 million worth of Cytosorb cartilages annually. The fact that one hospital already hit the one million dollar mark and that other accounts are also nearing that number lends credibility to his estimate.
The timing of the offering is curious, but there is just no way for us outsiders to know what is going on. I am hoping that it is a sign that talks with the FDA have already happened and a clinical trial strategy has been determined. 510k vs. PMA. There could still be a partner for REFRESH 2 on the horizon but maybe the partner wanted Cytosorbents to have more skin in the game for the trial? Or perhaps any potential partners wanted more than their fair share of fruit from the tree, so Cytosobents is showing them they are willing and able to go it alone if needed?
Would 9 million even be enough for the PMA route? They stated the capital raise was to fund the trial, working capital, R&D and acquisitions. So maybe they did get the go ahead for the cheaper, faster 510K route, which would be good for us investors. But then again, maybe a partner is splitting the cost of the PMA route?
The are just so many unknowns for us outsiders, that we just have to wait and see how things play out. Personally, I take comfort in the fact that company now considers this a de-risked investment. I think there are two things that lead to them classifying themselves as de-risked. First is accelerating uptake in Germany and the fact that the groundwork has been laid for 30+ other countries follow Germany's lead. Second is REFRESH 1 results and the fact that it has provided them with data that will allow them to design REFRESH 2 to target a patient profile with the highest chance obtaining clinically significant results.
In my opinion REFRESH 1 is far too small to expect a demonstration of clinical efficacy. We already know a portion of the procedures included in the trial did not even lead to highly elevated plasma free hemoglobin, so they will not help show efficacy. However, they will help them design REFRESH 2 to excluded those types of procedures, so there was still value to them having been included in REFRESH 1.
