Baxter Renal Spinoff Notes

This commentary is from Spectral Medical (TSX: EDT) conference call on February 22, 2024:

Christopher Seto Spectral Medical Inc. – CEO & Director

Scott, so first of all, what I would say is, we’re very pleased with actually the spin-off of Vantive from Baxter and our partnership will be transferred to the Vantive business unit or a company upon completion of their spinoff. It’s still a part of a large entity. So it’s one that generates approximately USD 5 billion in sales annually. While legacy Baxter has been, I’d say, great to deal with and has been a very good partner. Spectral was somewhat of a smaller fish in a big pond. And sometimes, it felt like there were a lot of other projects and interest that we were competing with for Baxter resources. With Vantive and since they’ve announced the Vantive spin-off, we feel that Spectral has been positioned as a key strategic priority. We’ve seen this in Baxter’s investor presentations where both EA and PMX are key featured product launches for Vantive.

Also, when you look at the portfolio of products within Vantive, PMX definitely has significantly higher growth potential and significantly enhanced gross margins relative to their other products. And that’s the nature of our PMX product. It’s unique. It’s not a commodity. There’s no alternatives. And if we get this right, PMX will be the standard of care for ESS and the US ICU population. And I think these are the characteristics that really excite Vantive and ultimately drive the enthusiasm and support that we have witnessed to date. So overall, we feel we’re very important in — well — we feel we were very important in the legacy Baxter world. Our association with Vantive feels like that importance is certainly amplified, if you will.