Beyond Air (XAIR) Piper Sandler 36th Annual Healthcare Conference summary

Financial and operational updates

• Debt was restructured, deferring $12 million in payments for two years and raising equity to strengthen the balance sheet; future debt payments will be based on royalties from net sales, starting in late 2026.

• Achieved CE Mark approval, triggering a $1 million milestone from a Southeast Asian partner, with initial shipments expected in the first half of next year.

• Signed a global device distributor to manage international partnerships, aiming to expand into several dozen countries over the next 6–12 months, with significant progress expected by 2025.

• Revenue recognition will vary by partnership structure, with current models based on royalties and future deals likely to include upfront distribution sales.

• No formal guidance is currently provided, but updates are expected in June for fiscal 2026.

Commercial strategy and leadership

• New Chief Commercial Officer, David Webster, has improved execution, brought in experienced team members, and enhanced marketing and GPO strategies.

• Commercial organization is described as “10x better” than six months ago, with improved hospital and government relationships, including a key partnership with Trilomed for VA and DoD access.

• Vizient partnership is being optimized under new leadership, with expected impact in calendar 2025.

• Marketing efforts now target younger respiratory therapists through social media and conferences, increasing product awareness.

• Negotiations with hospitals have accelerated as product reliability and reputation have improved, leading to a broader customer base.

Product development and market dynamics

• Upgrades to the first-generation system have resolved earlier issues, boosting confidence for international expansion.

• The next-generation system, featuring transport capabilities, is seen as a potential “game changer” and will be submitted to the FDA in the March quarter; approval and launch are expected to impact fiscal 2027.

• Upgrade process for current customers will be simple, with minimal training required and priority access to the new system.

• Market pricing for nitric oxide systems has declined by about 50% since the monopoly era, stabilizing the market at around $350 million, with some hospitals switching from Treprostinil to nitric oxide systems.

• The next-generation system is expected to improve contract win rates and gross margins, with U.S. launch prioritized before international expansion due to manufacturing constraints.