Cerus Corp
NASDAQ:CERS
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Cerus Corp
Earnings Call Analysis
Summary
Q2-2024
Cerus Corporation reported significant improvements in the second quarter of 2024. Revenue grew 16% year-over-year, reaching $45.1 million. Net loss narrowed by 56% to $5.8 million. Adjusted EBITDA turned positive at just under $1 million, a substantial improvement from the prior year. The company increased its annual product revenue guidance to $175-$178 million from $172-$175 million. Notably, INTERCEPT-treated platelets led U.S. revenue growth, and Cerus expects 2024 IFC revenue to remain in the $8-$10 million range. Cerus ended Q2 with $71.2 million in cash and short-term investments, reflecting strong financial health and a positive outlook for the rest of the year.
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Good day, ladies and gentlemen. Thank you for standing by, and welcome to the Cerus Corporation Second Quarter 2024 Earnings Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded.
I would now like to hand the conference over to Jessica Hanover, Cerus' Vice President of Corporate Affairs. Dr. Hanover, you may begin.
Thank you, and good afternoon. I'd like to thank everyone for joining us today. As part of today's webcast, we are simultaneously displaying slides that you can follow. You can access the slides from the Investor Relations website at ir.cerus.com.
With me on the call are Obi Greenman, Cerus' President and Chief Executive Officer; Vivek Jayaraman, Cerus' Chief Operating Officer; and Kevin Green, Cerus' Chief Financial Officer.
Cerus issued a press release today announcing our financial results for the second quarter ended June 30, 2024, and describing the company's recent business highlights. You can access a copy of this announcement on the company website at www.cerus.com.
I'd like to remind you that some of the statements we will make on this call related to future events and performance rather than historical facts and are forward-looking statements. Examples of forward-looking statements include those related to our future financial and operating results, including our 2024 product revenue guidance, our expectations for operating cash flows and non-GAAP adjusted EBITDA performance and our expected expense levels.
Expected future growth and our growth trajectory, the availability and related timing of data from clinical trials, planned regulatory submissions and product launches, product expansion prospects and other statements that are not historical facts. These forward-looking statements involve risks and uncertainties that could cause actual events, performance and results to differ materially.
They are identified and described in today's press release and our slide presentation and under Risk Factors in our Form 10-Q for the quarter ended June 30, 2024, which we will file shortly. We undertake no duty or obligation to update our forward-looking statements.
On today's call, we will also be discussing non-GAAP financial measures, including non-GAAP adjusted EBITDA. These non-GAAP measures should be considered a supplement to and not a replacement for measures presented in accordance with GAAP. For a reconciliation of non-GAAP financial measures to the most comparable GAAP financial measures, please refer to today's press release and the slide presentation available on our website.
We'll begin today with opening remarks from Obi, followed by the Vivek to discuss recent business highlights, then Kevin to review our financial results and expectations for the rest of 2024 and lastly, closing remarks from Obi.
And now it's my pleasure to introduce Obi Greenman, Cerus' President and Chief Executive Officer.
Thank you, Jessica, and good afternoon, everyone. I'd like to open the call with a review of the highlights from a strong second quarter as well as our positive outlook for the duration of the year.
Given the trends we have seen over the first half of this year, we are increasingly confident in our ability to meet and exceed our product revenue expectations. So we are raising our annual product revenue guidance range for the full year to $175 million to $178 million from our previous range of $172 million to $175 million.
Our confidence stems from the growing number of blood centers and hospitals that are using INTERCEPT in the increasingly important role of pathogen inactivation across the globe. Most recently, in Barcelona at the International Society of Blood Transfusion or ISBT Congress, we were delighted to see key opinion leaders present on a broad range of topics relevant to the INTERCEPT Blood System from platelets and plasma to INTERCEPT Fibrinogen Complex and red blood cells.
Pathogen inactivation has become a foundational part of blood safety strategies in addition to testing and donor deferrals. We are seeing more and more members of the global transfusion medicine community recognize this and the need in the context of pandemic preparedness.
One clear example is the growing threat from Dengue, a transfusion-transmitted arbovirus carried by the mosquito. Earlier this summer, both the U.S. Centers for Disease Control and Prevention and the European Center for Disease Prevention and Control have issued warnings about the risk -- rising risk of dengue transmission.
This is implications for blood safety risks and can lead to regional donor deferral requirements, which are burdensome and limited availability. The INTERCEPT Blood System proactively protects blood supply against this virus, along with many others and can be an important safeguard for the locally sustainable blood supplies.
In Florida, at the moment, many platelets can still be collected locally and distributed for transfusion when treated with INTERCEPT Blood System in the areas at risk for Dengue transmission.
To realize the benefits of a full pathogen inactivation portfolio for all transfused blood components, we continue to advance INTERCEPT red blood cell program. Since our last earnings call, we've had a number of meetings with our clinical investigators and scientific advisory board members about the ReCePI Phase III clinical trial data and next steps.
Later this fall, data from the ReCePI study will be presented at major medical meetings, including the American Society of Anesthesiology's Annual Meeting and the AABB Annual Meeting.
We continue to be encouraged by the reception with which these data have been received by cardiovascular surgery, anesthesiology and transfusion medicine experts. We are also in the process of finalizing the ReCePI clinical trial report for submission to the FDA.
RedeS, our second U.S. Phase III clinical trial continues to enroll. As mentioned previously, we recently opened a few more RedeS sites within the U.S. as well as an important thalassemia site in Turkey with a goal to finalize study enrollment by mid-2025, coincident with the initiation of the PMA modular process for an FDA approval.
Moving on to our new LED illuminator that we plan to submit for CE Mark approval later this year, we had the opportunity to showcase the new device in our booth at the ISBT Congress in Barcelona in June. This foundational platform for future growth of the INTERCEPT business has been well received by our blood center customers and the opportunity to demo the device to the same operators whose input helped design the instrument was indeed a rare gift. It was most satisfying to register their approval around their operational benefits realized, and we look forward to providing an update on our regulatory submission later this year.
With respect to the solid financial foundation of our business, we remain committed to reaching adjusted EBITDA breakeven for the full year 2024. Kevin will provide more insight into our pathway for continued improvement in this metric over time.
I would like now to turn the call over to Vivek to discuss our commercial results and progress for the second quarter of 2024 as well as our outlook for the second half of this year.
Thank you, Obi, and good afternoon, everyone. As Obi mentioned, with now more than half of the year behind us, we are increasingly confident in our sales trajectory for the full year. This is fueled primarily by continued growth in our U.S. platelet business as we have continued to increase INTERCEPT market share in this geography.
As we mentioned this time last year, a key focus for our global commercial team was to return to compelling growth and ensure that we are expanding access to INTERCEPT. I am pleased to see so many geographies contributing to our strong first half 2024 growth.
Of note, our Q2 performance was led by our U.S. platelet franchise as the fundamentals of that business strengthened. INTERCEPT treated platelets remain the standard of care for platelet safety in the U.S. During the quarter, we saw steady growth across all customer segments.
From an overall market perspective, based on our channel check, there was a slight increase in platelet collections and underlying hospital demand for platelets. Most importantly, with each passing quarter, the volume of real-world experience with INTERCEPT grows larger and both blood centers and hospitals realize the benefits of INTERCEPT that extend well beyond mitigating bacterial risk.
Moving to the international business. We are thrilled to report that, as expected, Canadian Blood Services or CBS, completed implementation of INTERCEPT across its entire platelet production operation and is now at 100% pathogen inactivation. With our platelet implementation now complete, CBS' focus is turning to their intention to validate INTERCEPT for plasma. Simultaneously, the validation efforts at Hema Quebec continue to advance towards completion.
Beyond Canada, we saw solid growth in many international regions. As Obi referenced, we recently attended the ISBT Congress. At that meeting, the strength of our international franchise was on full display. We continue to cultivate meaningful growth opportunities in the Middle East, Latin America and Asia-Pacific, while leveraging our 100% geographies like France and Switzerland to drive peer-to-peer educational efforts by sharing their long positive experience with pathogen reduction.
We hosted a standing room only symposium at ISBT and it is incredibly encouraging to see long-standing customer partners actively recruit new customers into the INTERCEPT rank. With new technologies such as the LED illuminator and INTERCEPT red cells on the horizon, our international markets will serve as the initial proven grounds for commercialization and customer uptake. I look forward to updating you on exciting international commercial progress in the quarters to come.
Turning to INTERCEPT Fibrinogen Complex or IFC, we are pleased with the progress made over the quarter. Based on new account activation, both in our direct-to-hospital business as well as via our large blood center partners, we remain confident in our annual IFC revenue guidance of $8 million to $10 million.
We made great progress in our education and awareness efforts during the quarter. We are now starting to really see the benefits of our fully staffed and trained sales team. Our clinical education efforts also are bearing fruit as we are now able to share published data from hospitals that have implemented and benefited from IFC.
The Stanford Group's recent paper in the American Journal of Clinical Pathology described significant improvements with IFC, including a 78% reduction in overall weight and a 58% reduction in order to product issue time.
Separately, in a retrospective review also published last month in transfusion, Kaiser Permanente Los Angeles Medical Center reported on its own IFC implementation in response to cryo shortages due to the pandemic.
The Kaiser Group observed a 74% reduction in weight and a 70% reduction in order to issue time with IFC. As with any innovative technology, peer-to-peer education on direct experiences invaluable. The list of hospitals using IFC is a virtual who's who of leading institutions across several clinical departments. At this point, it is clear to us that demand for IFC is real and growing and that our hypothesis about the clinical utility and differentiation of IFC is valid.
Our sales and marketing organizations continue to gain favorable attention at targeted scientific meetings, and we are seeing a marked increase in inbound inquiries about IFC. In parallel to driving increased IFC demand, we continue to push hard to ensure growth in product supply. To that end, we are happy to announce that during the quarter, another one of our contract manufacturing blood center partners received FDA approval for its Biologics License Application or BLA.
At this time, we have 2 additional manufacturing partners with BLA still under review by the FDA, which, upon approval, will increase IFC capacity even further. Furthermore, as more hospitals express interest in IFC, we are starting to field requests from new blood centers on how to produce the IFC.
Our progress in Q2 deepens our confidence in the IFC franchise, and most importantly, we are hearing directly from physicians that we are providing a product that materially improves their ability to care for their patients. I look forward to providing more updates on our progress with IFC in future quarters.
I will now turn the call over to Kevin to review our financial results.
Thanks, Vivek. Good afternoon, and thank you all for joining us. On today's call, I'll be discussing our financial results for the second quarter of 2024, along with commentary on how those results and our financial outlook for the remainder of 2024 compared to the plan we communicated earlier this year.
To start, we posted product revenue of $45.1 million for the second quarter of 2024. This represents year-over-year growth of 16% and brings the first half revenue to $83.4 million, up 20% from the first half of last year.
North American platelet sales were the major contributor to our product revenue growth during the quarter. In the U.S., second quarter 2024 product revenues exceeded prior year levels by 19%. As we anticipated, sales to Canadian Blood Services were also extremely strong and reached 100% across their entire platelet production operation during the quarter.
In EMEA, second quarter product revenues were up slightly year-over-year and up 8% compared to the first quarter of 2024. Year-over-year, FX rates were a slight headwind for the EMEA business of around 1%.
Also for Q2, we posted IFC product revenue of $2 million, up from $1.4 million in the prior year period, driven by both the addition of new hospital users as well as increased adoption at existing hospitals. As Vivek mentioned in his comments, expanding clinician experience with the utility of IFC in massive hemorrhage has been and will continue to be key to IFC's growth trajectory.
In addition to our product revenue, and not included in our guidance, government contract revenue totaled $5.4 million in Q2 compared to $8.9 million for the prior year period. The completion of our U.S. Phase III ReCePI clinical trial was the primary driver for the decline. We now expect our Turkish site to begin enrolling patients in the next few months. As that happens, we expect a modest uptick in government contract revenue.
As a reminder, included in our government contracts are the revenues recognized as reimbursement under our contract with BARDA, our agreement with the FDA to further hold blood pathogen reductions and our milestone-based agreement with the U.S. Department of Defense for lyophilized IFC.
Turning now to our product gross profit and gross margins. Our second quarter product gross profit was $24.7 million compared to $21.3 million during the prior year period, an increase of 16% year-over-year. Product gross margins for the second quarter were 54.7%, relatively stable when compared to both the prior year and Q1 2024. Absent any unanticipated factor, we continue to expect that gross margins will remain close to Q2 levels for the balance of the year.
Moving on. Our second quarter operating expenses, which totaled $33.9 million were $8 million lower than the $41.9 million the prior year, a year-over-year decline of 19%. Without the impact of the $2.1 million June 2023 restructuring charge, operating expenses were $5.8 million lower or 15% when comparing the June 2024 quarter to the prior year.
Q2 2024 operating expenses included $5.8 million in noncash stock-based compensation. By specific expense type, second quarter R&D expenses totaled $15 million compared to $19.2 million during the prior year period. Similar to our Q1 results, this 22% decline was driven primarily by the completion of the ReCePI clinical trial and the effects of the restructuring implemented in June of last year.
Second quarter SG&A expenses were $19 million compared to $20.5 million during the prior year period. The decline again driven by last year's restructuring. We do not anticipate significant swings in SG&A for the remainder of 2024 and anticipate continued leverage from our SG&A investments.
Let's now focus on the bottom line and non-GAAP adjusted EBITDA results. On the bottom line, reported net loss attributable to Cerus for the 3 months ended June 30, 2024, improved significantly when compared to the same period in the prior year. Net loss attributable to Cerus for Q2 narrowed by 56% to $5.8 million or $0.03 per diluted share compared to $13.3 million or $0.07 per diluted share for the prior year period. The net loss for Q2 of this year approximates our noncash stock-based compensation mentioned previously.
On a non-GAAP adjusted EBITDA basis, Q2 2024 generated positive adjusted EBITDA of just under $1 million compared to a loss of $4.7 million for the prior year period. We're pleased with the adjusted EBITDA result and remain steadfast in our commitment to deliver a positive adjusted EBITDA result for 2024 as a whole.
As we look ahead, the second half growth contemplated in our revised guidance, a continued focus on generating leverage from our operating expenses and stable gross margins are all expected to contribute to the anticipated achievement of our goal.
On the balance sheet and associated cash flows. We ended the second quarter with a cash position of $71.2 million of cash, cash equivalents and short-term investments on the balance sheet. It's important to note that the amount drawn on our revolving letter credit declined from Q1 levels by $1.2 million, suggesting that our reported cash balance at June 30th could have been even stronger.
At the beginning of the year, we foreshadowed that not only was achieving a positive adjusted EBITDA goal, but that we could possibly generate positive operating cash flows. Here too, we delivered a positive operating cash flow of $0.4 million in the second quarter compared to cash used from operations of $7.6 million during the prior year period.
While we aren't providing formal guidance on cash flows for 2024, we are keenly focused on continued improvement of our bottom line results and tight management of working capital, which combined could provide us with the components necessary to report positive operating cash flows in subsequent periods.
Turning now to our guidance. As both Obi and Vivek described, we are increasingly confident in our growth expectations. And as such, we are raising our full year 2024 product revenue guidance to the range of $175 million to $178 million from our prior guidance range of $172 million to $175 million. We are reiterating our full year 2024 revenue guidance for IFC, which we continue to expect to be in the range of $8 million to $10 million.
With that, I'd now like to turn the call back over to Obi for closing remarks.
Thank you, Kevin. The Cerus team continues to advance the INTERCEPT Blood System in many markets and is looking forward to the potential product approvals in the year ahead. The focused geographic expansion of our commercial effort, combined with the growing IFC business is providing for increased confidence in how we continue to ramp penetration and increase revenue.
Particularly in the case of IFC, the many positive case studies of routine use now coming from hospitals across the U.S. are validating the target product profile that we developed for IFC to address an unmet clinical need. Our safe and readily available fibrinogen complex product that is easy to use by the hospital transfusion service staff has found its place within hospitals and their anesthesiology and surgery teams.
Our leadership team recently sat down to review where we have been, where we are and where we're going. There's so much detail and complexity in our history, but it's often easy to overlook the key achievements and what Cerus has evolved to from where it began.
With INTERCEPT increasingly becoming the standard of care in multiple countries across the globe, we are committed to achieving our adjusted EBITDA targets to enable the self-funding of our product portfolio and continued geographic expansion that will allow us to realize our important mission as a company.
Thank you for your continued interest in Cerus. I will now turn the call over to the operator for questions.
[Operator Instructions] Our first question comes from Ross Osborn with Cantor Bridge.
So starting off, I would be curious to hear if you saw any rebuilding of inventory following your extended shelf life. As a follow up, where do you stand on further extending platelet shelf life?
Thanks, Ross. Vivek, would you mind taking this?
Sure. No problem. We in terms of extending shelf life, we anticipate filing later this year for the 18-month shelf life, so to get back to where we were prior to the dating issues. And in the quarter, we didn't see any significant rebuilding of inventories, but we continue to see driving underlying growth was really just [indiscernible] products. So there was not any material inventory rebuild at the customer level in the second quarter.
Okay. Got it. And then looking at Hema Quebec, could you provide some more color on exactly where they stand in the validation process and when we could start to see some incremental revenue from them?
Sure. So their validation is effectively complete. They are going to follow a path that's similar to what happened with Canadian Blood Services where they'll have a small portion of their overall inventory that's pathogen reduced and then upon sort of successful completion of that trial phase move towards full implementation. So we're anticipating that initial piece of their inventory to be pathogen reduced in calendar year 2025 with '26 being the year where we go towards full implementation.
Great. Congrats again on the results.
Our next question comes from Jacob Johnson with Stephens.
And I'll add my congrats on the quarter. And maybe starting with the highlight of the quarter, just the positive EBITDA we saw in the quarter. Kevin, as we think about the back half of the year, I know you're talking about breakeven for the fiscal year. But presumably, we should see revenues up in the back half of this year. Is there any way or any reason why we wouldn't see better revenue in the back half continue this trend of positive EBITDA that you saw in 2Q.
Yes. Thanks. You're absolutely right. As our guidance suggests, we do expect pretty strong growth in the back half of the year. In addition, and as stated in our prepared remarks, we do expect fairly stable gross margins for the balance of the year and continue to expect that we'll get increasing leverage from our operating expenses. So all 3 of those suggest strength on the non-GAAP adjusted EBITDA results for the back half of the year and give us a lot of confidence in our statements that we'll achieve our goal.
Got it. And then maybe for Vivek. On IFC, I heard you mention a couple of things. Just as we think about the growth outlook for that product line, I'm curious about how much of an opportunity there is from expanding within your current hospital customers that you're in today and doing more with them, how impactful could new hospital wins be?
And then I'm just curious, too, on the capacity side, it sounds like some more blood centers to come online. Is that something that's maybe constraining you in particular geographies? If you could kind of unpack some of those dynamics?
Yes, sure. I'd be happy to. And certainly, please follow up if you require more clarification. So starting with kind of growth from depth with existing customers as opposed to growth with new sort of de novo customers. There's significant opportunity in both. We're just starting to get our first handful of customers that are fully 100% converted to IFC. So same-store sales. I can express it that way. It provides meaningful opportunity for growth.
But we're really early days in terms of customer acquisition. So the fact is the vast majority is candidate hospitals to use IFC that haven't started yet is larger than our current user base. So we're -- it's really both and approach in terms of maintaining sustained growth.
We are seeing a marked increase in demand. And as we've talked about in prior calls, we're always looking to make sure that supply stays ahead of demand, not too far up front of it, but such sufficient supply so that we don't have to worry about constraining customers.
And we now have 4 blood center production partners who received BLAs, so they can transport product across state lines. We're anticipating 2 more BLAs here in the very near future. And that combined production capacity supported by the BLAs, we believe provides sufficient volume to support our growth expectations, both through the balance of the year and through 2025. We'll continue to monitor and track that closely.
The other thing that's encouraging, and I think I mentioned it earlier, is that we're seeing blood centers -- we're receiving inbound inquiries from blood centers, who are hearing from their key hospital customers they want to try and see, and they're keen to be the producers who provide them that product. So I anticipate over the near and midterm, we're going to see a pretty significant step-up in terms of the number of production partners.
So on balance, it's still early days, but we're really encouraged principally by the clinical value and utility of IFC and the fact that physicians are, in fact, validating our value proposition.
Our next question comes from Josh Jennings with TD Cowen.
This is Eric on for Josh. As a follow-up on IFC there, congratulations on the progress. If I could, I was just wondering if you could lay out sort of a road about of how you're thinking about growth for IFC in '25. I think the Street has total Cerus sales at, I think in the 190 to 200 ballpark. Could IFC be 10% of sales next year? Is that you think a good starting point? Just curious with all the growth here.
Kevin, I'll be -- maybe I'll defer to you in terms of quantifying the number. I certainly know the expectations down the year.
Well, I mean, clearly, we're not providing guidance for 2025 here. But Vivek, I think you can speak to sort of the growth opportunity that's in front of us and sort of calibrate our range. Obviously, we're guiding, Eric, as you know, $8 million to $10 million for this year. And there is, as we just discussed, a lot of white space in front of us. Anything else you would add, Vivek?
No. I mean, once we get to 2025 numbers here in future quarters, I think that's kind of a rough rule of thumb, I think that percentage is probably in range. We've got -- the key focus for us has been, as we support demand with increased supply and capacity, really working closely with our blood center production partners to ensure that they can produce sufficient volume that allows us to really push on the demand piece and grow unconstrained. And we feel confident that we're putting the building blocks in place to be able to do that.
The peer-to-peer interaction has really ramped up in the last quarter, and we anticipate as we get through the summer and into the fall conference season, we're going to have many more opportunities to share the single center and then the developing clinical evidence. We're getting and we anticipate that we'll start to drive more demand as well. And now we're -- we have a fully trained and staffed sales organization who cultivated existing customers.
So a lot of the investments, a lot of the things that we have put into place are really now starting to bear fruit. And so we anticipate that IFC not just for '25, but really for the next few years will be a meaningful contributor to allowing us to continue to grow, to drive compelling growth on the top line.
And just if I could, I'd be remiss if I didn't say that, we expect that growth to be largely leverageable, right? So not a lot of incremental investments as Vivek just mentioned that we've made those in the past and they're now bearing fruit. So I think that holds -- bodes well to the bottom line impact as well.
Understood. That makes sense. And for the INTERCEPT red blood cell program, I was hoping to hear an update on your progress in the EU there. Just what are the remaining steps between where we stand now and a potential clearance? I think last quarter, you mentioned that you guys had completed a complete response with the notified body. I was just wondering what the update is there.
Yes, Eric. So just to remind you and others about the process. So we have -- we still have to hear back from our competent authority, which is the CBG-MEB based out of the Netherlands. We still have not heard back from them yet, and it may be due to the summer holidays. So we do expect to hear something after the European holidays are over, so possibly before the end of the quarter.
And then once they get back to us with sort of their definitive opinion, then it goes back to our notified body, which is TUV and then that moves on to an approval decision. So I think at this point in time, it's -- we're still waiting for the CBG-MEB response. But as you mentioned, we did feel like we provided a complete response to their questions earlier in the year.
[Operator Instructions] Our next question comes from Mark Massaro with BTIG.
This is Vidyun on for Mark. So I understand that the business is stabilizing hereof of 2023 and sort of returning to growth. Just how you're thinking about sources of upside to the '24 guide, just any additional variables to consider like restocking inventory or recovery of platelet donors.
Thanks, Vidyun. Vivek, would you like to handle this one as well?
Sure, I'd be happy to. So in terms of how our outlook for the full year and our confidence sort of underpinning the raise in full year guidance. So we are not currently forecasting any rebuild of customer level inventory to be a driver of the revenue upside. We want to make sure that we can maintain healthy safety stock at our customers, but we're not anticipating an inventory rebuild at this time as kind of a onetime revenue driver.
We are seeing signals of a stabilizing collection and utilization markets, so increased hospital demand for platelets and then some stabilization that blood center level in terms of collections. But what's really driving the growth is sort of continued enthusiasm for an adoption of the INTERCEPT platelets and our ability to see those products produced and ultimately distribute it to hospitals.
And then in addition, as we talked about in some of the prior questions, the demand on the IFC side continues to grow and in parallel, our ability through our production partners to produce supply is growing as well. So we see continued growth in the IFC franchise in the second half of the year. So it's really the combination of those factors that give us confidence in our ability to continue to see top line progress.
Understood. And then I think I heard you guys briefly touch a little bit on the next-gen illuminator. So could you just help us think about some of the features and to help us sort of quantify the planned improvements there? And if you could also remind us what the thinking is in terms of timing of the regulatory submission.
Yes. Thanks, Vidyun. So one of the key things we were trying to achieve with the next-gen illuminator, what we call INT-200 is that this would increase the operational ease of use for blood center customers and also reduce the space that they needed because a lot of these blood centers are very space constrained. So right now, the current illuminator the INT-100 will take the space of 3 INT-200. So it really is a space saver for these blood centers, but it's also a lot easier to use with regard to sort of the graphical user interface and just for the reliability of the system.
So as I mentioned in the prepared remarks, we're really happy to see sort of the feedback from customers at ISBT in Barcelona. It was the customers who we engaged early on in the development of this device, and they were really happy with how their feedback led to this final result. We are looking to file for approval here in the relatively near term, and it's roughly going to be about a 180-day review cycle for CE Mark approval in Europe. So that product we expect to launch in 2025.
Our next question comes from William Bonello with Craig-Hallum Capital Group.
Just wondering if you can give an update on international and any sort of pending opportunities outside of North America?
Yes. Thanks, Will. Vivek, would you mind taking this as well?
Sure. Happy to. So we have -- and I think we've talked about this previously, but we continue to make good progress on our joint venture in China. We anticipate learning by the end of this year, whether or not there will be a need for a local clinical study. But the underlying clinical demand and interest in INTERCEPT remains quite high in that geography. So that will be -- that's a fantastic growth opportunity for us, really materializing towards the back part of this decade.
Similarly, the strong distributor partner in the Middle East, there's a significant push towards health care investment in the Kingdom of Saudi Arabia, and we're seeing strong growth there and a lot of practice patterns in the Middle East mirror what happens in the U.S. since they follow through the AABB FDA standards.
And then we continue the single largest unit opportunity in Western Europe, Germany, and what's encouraging there is the largest blood centers and hospitals are going through the marketing authorization and marketing and the regulatory process. So those are sort of 3 snapshot examples of geographies where we think can drive significant international growth.
We have a strong team on the ground in EMEA, and they really have been executing well through the first half of this year. So the international franchise certainly is a significant component of our future growth plans. It's also going to be the initial commercial geography for the products in our pipeline. So it's where we'll introduce the LED illuminator first as well as INTERCEPT red cells. So really continues to be a value for part of our franchise.
And when you think about some of those opportunities, and as you start to look at sort of to next year and you think about the magnitude, I mean, are these the kinds of things that could actually drive an accelerating growth rate for you? Or do you look at it as more no, we have to add some of these big non-North American clients to just sort of keep up with the growth that we got out of adding Canada and whatnot over the past couple of years?
It's a little bit of both, candidly, because part of it is a function of the size of the geographic opportunity and the potential ramp. If you look at our history, you have some geographies that are significantly sized, but they have more sort of vulcanized customer base, and so it takes a while to get folks on board.
Other countries that have significant volume have a single decision maker, and once they decide to go and then it really becomes about operations and partnering with our deployment organization.
And in those geographies, I mentioned, there's kind of a mix of both customer types. So part of it is who goes when and how quickly we can ramp up that's in parallel I mentioned -- I referenced it in the context of IFC, but also our platelet franchise. We're trying to make sure that we have sufficient supply to stay ahead of demand.
But I think you're going to see, certainly in the U.S., the IFC franchise is a significant growth opportunity. But internationally, some of these geographies that they come on, it's not merely sort of maintaining our growth rate. But if they go well, we could certainly see some upside there.
I would now like to turn the call back over to Obi Greenman for any closing remarks.
Well, thank you again for joining us today and for your interest in Cerus. We look forward to keeping you informed of our progress throughout the rest of 2024 through quarterly calls and upcoming investor conferences. Thanks very much.
Thank you. This concludes the conference. Thank you for your participation. You may now disconnect.