Lumos Diagnostics Holdings Limited (LDX) Earnings Call Transcript

Welcome to the Lumos Diagnostics Quarter 1 FY '27 Investor Briefing. One is George Kopsiaftis. I'll be your moderator this morning. Joining us on the call today, we have Chair of Lumos, Sam Lanyon; I've got Doug Ward, Managing Director and CEO; Barrie Lambert, Chief Financial Officer; and Paul Kase, Chief Commercial Officer. Good morning to you all.

Good morning, George.

Okay. So the team's got quite a bit to cover this morning. We'll aim to keep the presentation to around 30 to 40 minutes, leaving plenty of time for questions at the end. We are targeting it finishing at approximately 12:00. [Operator Instructions] And today's presentation was lodged with the ASX this morning and a recording of the briefing will be made available on the Lumos website once available. And with that, I'd now like to hand over to Sam Lanyon to get us underway.

Hi, everyone, and welcome to the update this morning. Really looking forward to this with you all. The last quarter has been a time of spending a lot of time in planning preparing and building towards the North American flu season, which is coming up. And of course, the team here is going to expand on why we're actually so excited about where we're heading. The thing that I'd like to also say is there was a recent announcement regarding changes at the Board level, and I'd like to thank formally Larry Marron's contribution to the business at the Board level, and obviously, he's going to have us going into the future from the commercial perspective working alongside Paul Kase and his team. And I'd also like to thank guys for joining us from Tenmile. I think that's going to be a good addition to the Board as well going forward. So happy to take questions on that at the end. But otherwise, I'll hand over to Doug to go through the update alongside Paul and Barrie. Thanks, Doug.

Yes. Thank you very much, Sam. And yes, I look forward to having us on board and do appreciate everything that Larry did for the company. So thanks again for that. So slide and the one after that, please, Barrie. Okay. Listen, I'm only actually going to talk about -- for a few slides here to start, and then we're going to turn it over to Paul because I think that the most important thing that we can talk about is the commercial traction that we continue to move forward here in the U.S. I'm feeling very, very bullish about where the business is right now. And I would say we're on a very, very good track exactly what our plan was in terms of getting accounts online, getting them to actually evaluate the product, our strategy to go after the top 100 and also, I would say, relative to the overall plan as a business, we're tracking exactly how we'd hope we would in this -- in the first quarter of this year. So let me go through some of the highlights of some of the numbers here. So since the last time we've talked, right? We've added 50 new live accounts to those using FebriDx. So that in about a 4-week time frame is great. addition to those accounts that are live. Paul is going to speak more about those specifically of those that have gone live. And again, right now, we're seeing really good momentum of moving from that validation stage and evaluations age into that go-live stage. But you got to continue to feed that funnel. And that's what Paul and Crystal and Tommy as well as the phase team are doing all together in driving what we call the evaluations out there. We're validating both the clinical as well as the economic merits of bringing the test online. Great news, 80 new sites. So now we're up to 485 sites that are in evaluation with us. So we continue to build this momentum. I've been in this field of diagnostics for over 35 years. And without a doubt, the hardest thing to do is to introduce a brand-new product that, quite frankly, what you are replacing does exist right? There is no test that does what we need it to do with FebriDx. So getting people aware of that getting it brought in and then getting it paid for it. Those -- that first amount of time to get that undergoing is really, really hard. But boy, I can't tell you how thrilled I am with these results right now with this number of live sites and a number of evaluations that we have going on right now. And then Paul will talk more about the 13 of the top 100 now that are either live or in evaluation for us. So moving quite nicely in that part of our strategy, right? That's the, if you will, the well strategy. These are very, very large accounts. they account for something like, I could say, 40% of all the volume out there in the market, and we already have 13% of these 100 -- top 100 in valuation or line. So great outcome so far in that regard. And then lastly, I'll just say, "Hey, you know what? We're sitting here in a great position from a financial standpoint." One of the critical things that we did when we secured CLIA waiver was to also do the capital raise. And at that time, I think there were people who was on, hey, do you need to do a capital raise at this time. And I would say given what it takes to launch a new product into the U.S. health care system and knowing that it's a seasonal product as well, right? Most of our sales aren't going to happen until January through to April. So that does take cash in order to implement our plan. And what I would just say is right now, we are marching along exactly in sync with the plan that we put forward, and we're feeling very, very good about where we are. Next slide. So again, I would just say there is a total method to this madness, if you will. It's very, very methodical. It's about building that awareness, getting people to validate this test and then getting them to go live. And really, it's -- I would say it's that first part is the hardest part with a great that's like FebriDx. It's just getting people to understand this thing exists, and it's available to them. Once people start to evaluate this product, the feedback coming in has been overwhelmingly positive from how easy it is to use, how easy it is to read what it is to use it and get a result from the patient and then to get reimbursed as well. So we're feeling very, very good about once people are aware of it. They are -- they quickly validate it and then they tend to go live pretty quickly here. So feel good about our path here. Next slide. And then again, this just kind of puts it on one slide with our announcements that we've given over the last few months here about where we've gone. Remember, this product didn't even hit the shelves as a clear way product until April, right? We secured at the end of March and we already see this kind of traction in the marketplace today. So I think this is terrific news. I would also have you on this slide look over on the right-hand side about the number of ARI visits that these sites are -- have the potential to deliver with FebriDx. And this is the type of volume that certainly, if we can get a vast majority of these people using it for the majority of their patients with ARI, we will certainly, I think, exceed the expectations that I have relative to our revenue going forward with the product in year 1. So with that, I believe, next slide, we're going to pass that over to Paul, who can give you some really nice detail in what's going on out there in the field.

Doug, thank you. And I appreciate everyone's attention and very excited to speak with you and walk through some slides. I'm going to -- if you can go to the next slide for me, Barrie, first to start, with marketing and some of the updates and kind of our build surge expand, and then I'll get into more detail as Doug has explained around the accounts that are validating and go live. First, on this slide, you all potentially seen before, but it bears repeating, this ecosystem is working. It is accelerating adoption. PHASE Scientific, obviously, our exclusive distributor are doing a great job with us in the field. Acuity is all about claims data and intelligence around there as well as targeting high-volume accounts. Prospectus as we move left to right here, a great partner to us as far as reimbursement support. They're still holding the hands of our new customers helping out with site onboarding and billing setup for those customers and demonstrating cases that the dossier for medical necessity to the payers. So great job. And then CG Life which we've discussed briefly, that is our marketing partner from a standpoint of PR and brand and lead generation. So just to touch on that ecosystem, but I'll go into the next slide now, Barrie. So from a standpoint of marketing, it's about building and then jumping in with the surge around respiratory season and then expanding. So this plan is obviously aligned to our respiratory season. On the left side, from a standpoint of build, we are very pleased with the outcome of how we position the product over the last quarter, the awareness, the education and the messaging that occurred, multiple LinkedIn campaigns. I'll get into some of those analytics in a future slide, Barrie, please, with the outcomes. And obviously, media going into market now around CLIA waiver, which obviously is now targeting the top 100 and really giving us a much more expanded footprint for FebriDx to target. We then -- so we -- I feel like we've completed the build, you're always still building, but in this case, from a standpoint of positioning and messaging, we're there. Now we go to surge. And surge, in my opinion, is pretty much now through the end of December as we -- as this respiratory season campaigns kick off. We are very busy with conferences with trade shows -- we have -- so we're in front of customers as well as the actual marketing campaigns that we've commenced. And then initial customer case studies. Some initial VOC, if you will, for those folks that have come on board and are experiencing positive outcomes from FebriDx. And finally, the expand and expand is basically taking those accounts from -- that are in network rollout to make sure it's in standard adoption, right? But so making sure that all sites have been accounted for with a particular urgent care organization that has come on board. We also are able to go back during expansion and use reference accounts and revisit and retarget some leads that may not have pulled the trigger at the time during our surge, if you will. And then we're employing all of our sales, the tools that we've created, the marketing resources we put through and take advantage of that entire toolkit. And I think the UCA Conference in April is going to be extremely robust based on the activity that we're already experiencing. So all in all, the awareness is building before the season, it peaks and then we carry that demand into 2027 in January. The awareness engine is important. And so we're talking about paid media, earned media and endemic media. And so as I talked about with LinkedIn and the next slide, give those analytics, I'm very proud of the fact we created a ton of awareness before the search even begins for interested physicians and providers. Then we move into a paid search. We've already embarked on this with Google Ads already seeing decent traction there. account-based media. That's also called account-based marketing. That's where we are basically guaranteed leads from named target accounts. So we're sticking with our top 100 but we're doing a very focused campaign on FebriDx within those executives, providers, nurse practitioners, all of them within a very, I said, a very focused approach. And so that just kicked off. We're very excited to see those leads come in and certainly keep the market posted. And then endemic media, endemic is really putting FebriDx from a native standpoint in an environment that supports it. And in this case, Becker Healthcare would like to work with us on a webinar that might leak into January of next year. but we'll put our key opinion leaders on there and basically build on the channel virgin care that already is trusting. So we're excited about that, too. Earned media is organic, right? And I'm excited to have additional slide on it, but we have a customer already that's put FebriDx on a TV news segment, more to come on an additional slide. But the pathologist article, I ran -- I did a podcast with diagnosing DS -- Dx. And we're also looking at other independent authorities like Sidrap that they're interested in helping with creating awareness and education around FEBRADEX. So all of them running together through this season is basically handing us qualified sales leads in the urgent care space. Next slide. So as I said, LinkedIn and our analytics around it. An example on the left side is one of the campaigns, and this was the clinical ad. And at the top there, when we say 2 campaigns, same result, clinical messaging as we ran 2 campaigns was the clear winner, especially well over almost double LinkedIn's benchmark of click-through rates. And so as you can see, with both campaigns are averaging almost 7,000 impressions. The click-through rate is what 0.75 and 0.7, which is well over LinkedIn's benchmark. But those were the tire campaigns. The clinical ad itself really resonated. And so that was right around 1% for just that ad. So the takeaway is we're very pleased this was an education awareness. It did actually produce leads. But the idea was to get clinical leaders to respond and then lead with that creative -- and so that's what occurred. So next slide. So in the midst of LinkedIn campaigns and Google ads, as I said, an account-based and marketing, we're also still meeting customers face-to-face. And so the -- this was an EDM that came out about Texas Nurse Practitioners Conference, the Northeast Regional Urgent Care Association. And where I am right now, it's been a good long day, we're at the urgent care center Congress in Orlando, myself and my Director of U.S. sales, Tommy Hall, had a fantastic day to day, much more of a networking event with executives in urgent care. So we're actually here right now. And in the middle there, we decided to have a little fun with it. I know it looks a little cartoonish, but we're at these shows. And in this case, it was a Texas Nurse Practitioner show and the clinicians wanted to be part of it. It was -- we're putting FebriDx in their hands and they were having a lot of fun with that and some swag. And so we've been showcasing some of the pictures of customers who are involved in the protocol process and the approval process. And so we just try to make it a bit fun at the same time. So very successful 3 shows. Next slide.. So we talked about earned media, and this is a perfect example. And this -- and I want everyone to listen to me here. This is just a start. Okay. This is just the start of making a huge difference. And so Ohio State University health system was extremely interested in the product at the Urgent Care Association meeting earlier this year. they decided we're going to implement in all of our sites immediately, and we're trained. Now the initial first 2 days, I got an e-mail and said, this is unbelievable. Our patients are so pleased. We already feeling like our Yelp ratings and the physician ratings are going to be increased. So we'd like to go to the local news and run a segment. And so they did it on their own, which is interesting. I found out about it by seeing it. And so it's an excellent clip that we ran through the local news right around 6:00, and this was a couple of weeks ago. Dr. [ Dela Torre ], who is very interested in doing more for us from a standpoint of consultant had a nice part of the clip. And what does it mean? Well, that coverage did quite a bit for Lumos and FebriDx. One, it was validation from a very large university health system. It helped to showcase the novel solution that FebriDx is. Everybody -- our value proposition is to meet an unmet need, and that's exactly what this click did. And one of the best parts too is it create awareness and interest from other health care organizations. Ohio State Universal system got a bunch of calls saying, "Hey, we've been looking into this, tell us more about it." So they became a reference account. And it's almost like an organic now a key opinion leader with Dr. Dela Torre. So it's very exciting. It says to in Ohio as of today, that's now and we've almost created a competition for differentiation in using FebriDx just in the state of Ohio. And the plan is to take that recipe and bottle it and get to the other new centers where we have other larger accounts in different states and do the same thing. And so we're really excited about it. Next slide. So if my passion is not coming out enough. It's going to come up -- sorry for now. That's okay, Barrie. So we've provided experiences in the past and some of these anecdotes and success stories, but this one is big. So things like number one, where we prompted further evaluation where a patient tested negative for COVID flu and STREP and since they were going to send that patient I'm thinking it was viral, but in running parallel FebriDx, they got a positive result. They then said, well, they couldn't figure out source. So they brought in x-ray and the patient had a pretty severe case of pneumonia. That's just a a wonderful story of FebriDx helping out. The next same thing, 2 days into a sinus symptom, if they hadn't run back FebriDx, they would have sent the patient home thinking viral. Instead, they ran it pretty nasty case of sinusitis got the patient on an antibiotic, a proper right use of the antibiotic and avoided a return visit. And number three, it's bolted on purpose, and that is back to my point about the Ohio state coverage. In Ohio and urgent care, a large burden care, so patients are coming in and asking to be FebriDx. Now what's really interesting about that, right, is that means, one, they saw the news clip, obviously, but this is consumers. And this is a groundswell. When you have awareness reaching a patient and then going into demand the test. That is a perfect scenario. And to achieve that, in my opinion, after 6 months is incredible. So we're really pleased about that. Next slide, please. Okay. So let's talk about accounts validate going live. I'm going to head back, go over some of what Doug had given to you already, but at the same time going to a little more detail. So next slide, Barrie. So we still have our 4-stage framework. And if you wonder why the qualified opportunities as kind of graded out is because it's a very, very significant number. I'll say that again. It's a huge number. But we're not counting folks who call us, want to learn more, want to talk to us. I think that's great. And those are all in that section and the number is gigantic. But let's zoom in on those accounts, though, that have called us we've gotten into conversations, and they have embarked on a valuation. And that evaluation is both click and economic. And I will tell you, it's a little more economical than clinical okay, at this stage, but it's now up to 485 sites in active valuation. Again, I'm not talking about large urgent carriers that are kicking tires right now and considering I'm talking about ones that have actually put a product in their site. And if there's, say, a 50-site urgent care, and they've put it in 4 or 5 of them in 5 different states, that does occur because they want to look at the economic validation of it. But very pleased that 8 of our top 100 are in part of that 485 sites that are evaluating FebriDx right now. So we then move forward to Doug's Doug mentioned 265, very proud of that number, 29 states now, 5 of those are in the top 100, and that's not 5 overlapping. That's 8 plus 5, okay? So on the evaluation, 5 going live, and we're adding more to it with each month. And so we'll keep everyone posted on the framework so all of our investors here can follow this commercial traction, but really pleased at where we are right now after 6 months. Next slide. So of the 1,300, we're talking about evaluations right now. I'll just give you insight into these 3 groups that are new since the last update I supplied you all. And the reason why I want to do that is because it's not just about the urgent cares, we're staying very focused on urgent cares. But if you look at Group 1 in the Southern U.S., a nonprofit health system with 25 hospitals in 400 locations, okay? So when you look at that size, it doesn't mean they're going to stop with urgent cares, right? It means there's a bigger opportunity there when it comes to the cell systems. The same with Group 2 in the Midwest, 65,000 caregivers, 170 locations. And again, they're in the top 100 because they have 30-plus urgent cares. And then finally, with Group 3 in the Northeast, huge physician-led multi-specialty group, very high-volume locations, 50 plus. And so if you see at the bottom, basically, those 120-plus urgent care sites, 50 of those are evaluating and equates to approximately 300,000 ARI patients a year at just those 50 sites that are evaluating. So really happy to share that with you. Next slide. So we talked about evaluation. Now we're going to talk about the latest and greatest since my last update around standardized adoption. So a Midwest academic health system has gone fully standardized adoption in 20-plus outpatient settings. The network, though, is over 100 locations, and that network that sees over 2.5 million outpatient visits. So we're excited to see where that's going to continue to grow. In the middle, under full network deployment, where it says Northeast primary care network, this is a primary care account. The reason I want to bring it to everyone's attention is to make sure everyone realizes, yes, a very, very strong focus, which will remain on urgent care. But primary care is gaining some traction, everybody. It just -- It is. And so we have a a 12-plus site primary care group in the Northeast with 300-plus providers, just primary care providers. They saw FebriDx. They immediately -- they've already been trained. They immediately have deployed it. They're looking at right around 100,000 ARI visits in those 12 sites. And it just shows where primary care shouldn't be forgotten, right? It is, and that's what I was talking about health systems, too. You have urgent care and may easily complete into the primary care side as well. Now we get to Wellstreet, and I'm going to save some of the questions and I'm sure you are waiting for me around Wellstreet. We have -- I personally have very positive conversations with WellStreet on a very consistent basis. In fact, I even talked to Wellstreet today. And what I'd like to basically tell you is our target for Wellstreet to expand in all the remaining locations by flu season is still intact. I'm still extremely confident that the relationship is very positive and nothing has changed from that standpoint of target and what we plan to accomplish. Next slide, please. Just to -- you guys have probably seen this before, I believe, but just to remind you from a standpoint of U.S. respiratory season -- as we've said, it's the surge in a buildup and everything is going to plan. Everything is going to plan, all right? And so we're anticipating with we have inventory. We have 750 now sites that are live or evaluating -- and as I said, our surge at Phase 2 of marketing is already reaping benefits. And so we expect a very robust season that is -- starts in the U.S. pretty much after Thanksgiving and extends through March, sometimes even later March, we'll see where this one goes. So I just wanted to touch base again on respiratory demand and how it arrives and where it's going. Okay. I believe, Barrie, I'm going to send it over to you for our financial results. Thank you, everybody.

All right. Thanks, Paul. Lots going on. That's exciting stuff in sales and marketing. Thanks, mate. Just a couple of slides on the financials, one on revenue and one on cash flow. So first one, just an overview of revenue for Q1. So just to remind everyone, all these numbers are in U.S. dollars. And please make sure you have a read of the quarterly report, it's got a lot more information around revenue and the cash flow as well. So just Q1 revenue on the chart on the left here, we've got the quarterly revenue going back to Q1 FY '26. And on the right, just a breakdown of the revenue for the quarter. On a like-for-like basis, you can see product revenue was up 224% on the prior corresponding period, and that's excluding the onetime exclusivity fee paid by phase in July last year. So on a like-for-like basis, up 224%. And within that number, FebriDx sales was up 351% over the first quarter last year. On the services side, revenue was $1.5 million. That was about $0.5 million less than the prior period in Q1 last year. And the main reason for that was less IP revenue we recorded on the contract with Hologic. It was about $0.5 million lower than the prior period. And as you'll see in the quarterly report, there are some comments on the project with Hologic. It was a little bit less work in Q1 and we have sent them a proposal and just waiting for them to respond on that proposal for additional work on that project. Across the quarter, we added about 12 projects during the quarter, including Hologic, MicroPak and work for TeleMedVet and Apatek as well. And so as Sam and Paul said as well, and Doug, obviously, the company is seasonal business with Q1 and Q2 being the quiet month and Q3 and perhaps the first part of Q4 will be the higher sales months with the U.S. flu season. So just a couple of comments on the cash flow. So I moved over to the waterfall approach here just to show the movements in the cash flow. And please read the quarterly report, which has a lot more description. So opening cash of $15.4 million and then closing cash at $11.8 million at the end of September. Cash receipts here, you can see from customers $1.5 million versus the $2 million revenue we reported. And the difference there is just the prepayment from PHASE. So as everyone remember, after the CLIA waiver in April, there was a $5 million prepayment from PHASE. So as we ship the product, we record the revenue, but the cash has already been received in Q4 of FY '26. Payments to employees and suppliers was 6.1%. And as I mentioned in the quarterly, the investments in there, there's $1 million investment in inventory as we build ahead of the U.S. flu season with investments in sales and marketing, as Paul outlined today, investments in the pediatric study and also this invest in the build-out of the Vicidity at our new facility in Carlsbad in California. Just a couple of other comments on the cash flow. Included in financing is the exercise of options by rider capital. They exercised 26.1 million options at $0.07 on the 15th of September. And yes, we just think writer capital for their continued support. That's included in the financing number there. And then closing cash of $11.8 million at the end of the quarter. I think that's it, Doug, I'll take -- happy to take questions at the end, but I'll pass it back to you.

Yes. Okay. Terrific. Next slide, please. So I just wanted to get 2 quick updates. One is on the pediatric study we are at about roughly 400 patients enrolled. And if you recall, where we wanted to be by year-end, that was more near the 700 to 800 number. So we are, I'd say, less than, right, the number we need from a total and that obviously directly impacts a number of bacterial positive as well. So we're doing a few things with BARDA to basically address this. Number one, we have brought online through 3 hospital emergency departments to be in the study before we were really just trying to use pediatric primary care offices to do the study. And unfortunately, we're just not getting the patients enrolled that we want. So by going to the ER, here in the U.S. where these will all be pediatric emergency departments. We think that, that will have a profound impact on then having more pediatric patients enrolled in the study. In addition to that, in in lockstep with BARDA, we have approached the FDA to talk them through where we are in the study and then steps that we believe take in order to improve this and try to get this back on track from a number and/or timing of when we can complete this study in collaboration with BARDA. So we'll have that meeting with the FDA and BARDA at the end of this calendar year, and certainly, we'll give everyone an update at that time. on that outcome. I would stress, okay, because I don't want people trying to read between the lines, if you will, of this. The performance of the test is excellent. And we're seeing very, very good performance in regard to people utilizing the test and getting the results that they would expect and so forth. Right now, it's just a volume gain for us. So I don't want to leave anybody with an interpretation here of, "Oh, there's any performance issues. The performance is great." As, quite frankly, as it always is, it's just a volume game, and we are putting in place with BARDA some things that hopefully can address that pretty quickly here. So that's the update on pediatric. Next, Barrie. Is just -- listen, you know that in the end of Q2, the very end of Q -- no, I'm sorry, the end of Q4 last year, we did prepay $2 million from the capital raise in terms of the renovation that we have on our manufacturing facility that will allow us to hit the minimums here in the contract. So that's going according to plan. It looks very positive that will be in that facility and operational by the end of this calendar year, which was the plan. after the capital raise. So a great job there. We'll continue to obviously need to spend some cash on that renovation -- we did spend some in Q1, and we'll spend a little bit more in Q2 on it, and then we'll be up and running in utilizing this facility here in the U.S. And then final slide, Barrie. Just to reiterate, listen, this is all about one thing, everyone. And we know it and we feel good about it. This is about driving revenue. It's about getting customers, okay? So building the awareness now I get it, a lot of people probably are like, "Hey, we don't necessarily always want to hear about all the marketing stuff we want to hear about final sales and so forth. But to be quite frank, without doing the marketing, you don't get to customers, you don't get the sales, and it's a pretty straightforward recipe for success. And I feel great about CG Life and a job that Paul and our new marketing staff have done in quickly driving awareness out there and again, getting that pipeline up and running. So having 485 sites under evaluation is I mean that's stellar, right, from a standpoint of the month that just product spend on market. Now we kind of have 2 paths on that. One is to get them live and the other, though, is to also, especially in the top 100 to get that utilization up as high as possible on all ARI patients. So the team is spending and investing time and resources in driving that hard. And then I would just say, right, a couple of things that you can expect to hear from us on. We have our AGM coming up in November here. peak season. It's still -- if you get on the CDC site, it's still in a pretty minimal category of where flu is here in the U.S., but getting all of these sites up and running and getting them prep ready for that peak is what we are focused on. End of year, I'll give you an update on the pediatric study as well as up and running and having our new facility totally validated and operational. So with that, like I said, listen, to me, things are going extraordinarily well, very positive and exactly according to the plan that actually we've laid out. So we feel great about that. And we look forward, George, to questions that people may have.

All right. Great. Thanks, Doug, and thanks all for here quite extensive update. We do have a few questions. So why don't I get started? Actually, firstly, there was quite a few questions on Wellstreet, but I think Paul's quite adequately answered that. So I won't pose that question again. Second question. sites came on board, but just have FebriDx sitting on the shelf to be used head and miss. So can you say the percentage of onboard at sites that have a standardized mandated workflow. Is it over 50%? Or is it under 50%?

I can take that. So each account is a little different, but I'd say it's over 50%. But let me just explain for Doug's point that utilization is key. And it's not necessarily mandated, right, because you can't necessarily always assume there's going to be a standing order of FebriDx within those accounts. The goal is to get them to a standing order right, and to increase that utilization, more ARI patients, the better. But as far as the accounts and the ones the top 100 accounts that we've identified, yes, it's more than 50%. And again, that utilization, though, hasn't really kicked off because we haven't had the flu season yet. So we'll continue to analyze that data and work with those customers to drive more patients and more ARI.

Great. Thanks, Paul. Next question, does the company have a long-standing contract with a timer to supply your kits? Or could the company change at any time to receive future supplies from U.S.A. or opposition? I think he probably meant competitors?

Yes, I'll take that one and feel free, Barrie, if you want to jump in as well. But -- so number one, we have a contract with them, and it is a lengthy contract. So we feel great about that. We're really, really pleased. And by the way, that contract also means that we're exclusive partner we've been relative to a FebriDx test, right? So that's exclusively with us. And we're, quite frankly, very, very pleased with that relationship that we have with them. And we're both trying, I think, to maximize the opportunity for both of us here, which is terrific. Now having said that, and I'm just going to be a direct. It's really important to understand that FebriDx is an FDA-cleared product, which to change that product meaning to not use, say, the cartridge from Atomo. If I were to do that for our existing label, in product, that would require a significant amount of data in work with the FDA and therefore, expense. That would make no sense to us that we would do that for the current label. Having said that, right, while we have an exclusive relationship to use our technology with a tomo, if we chose to go after a different label with FebriDx, say, the chemistry component and so forth. That would, one, require a new clinical trial and a new opportunity for us. And in that setting, we could theoretically choose to use it a different antibody, a different cartridge or other components or whatever. There's nothing that forces us that we must use that going forward. But let me tell you, we're extraordinarily pleased and we're seeing the results, right, with those customers that are going live today, which to me is the most important thing they're learning about something in the relatively future, if you will. So hopefully, that answers the question. I don't know, Barrie, if you want to add anything there.

I think you've covered it. Yes, we have a multiyear contract with Atomo the supply that I said. And as importantly, as you said, that contract gives us exclusivity over that cassette in our field. So in the bacteria versus viral field. So ensures we have the exclusive use of that cassette for our tests, which is important. So I think you've covered everything else.

All right. Thank you. The next question is the multipart question. So I'll ask it to the parts. How many FebriDx test we shipped in quarter 1? And what is the average test per live site per month?

Yes. Number one, I don't think we give the number of tests because right, that would India and then give away our price for the test, which we consider to be proprietary with PHASE at this point in time. So we actually do not provide that. We give a revenue number for the month.

Most of the product revenue for Q1, George. So product revenue was $564,000 for Q1. Most of that is FebriDx sales in the U.S. As I said, under our confidential out of the obligations with PHASE, we can't give away the transfer price would be a breach of contract.

All right. And you actually answered the second part of the question. Third part of the question was how much of what PHASE bought has actually been used by sites? And how much is sitting in phases or sub-distributors inventory?

Yes. Just let's say, number one, we don't provide that. market information, that is information that is shared with us, both from our partner, PHASE, but also to phase from their distributors. So we do have look at what is shipping and where it is. So the great news here is that we have some great partnerships with great analytics that gives us visibility to what's going on out there. So we feel very strongly that, again, we're marching according to plan. Now what you should know is we are building inventory, right? We, within Lumos, we expect most volume to go through from January, February, March, right? So you can imagine that we're establishing significant inventory -- this past quarter, we'll continue to do it next quarter, and we'll continue to make it in Q3 as well. So I understand it that now that will peak and then come January, right? We want to see that volume start to really start to use up that inventory and that stuff being shipped out to PHASE. So that's kind of how that will end up working.

All right. Thank you, Doug. I mean just following on another question sort of in a similar vein. What's the low and the higher range for expected FebriDx sales for the flu season running October through to February '27?

Yes. We just don't provide guidance, guys, at this stage in the company, right? It's the first year, the launch of the product. And quite frankly, it's interesting because at most other companies that I've been at, whether it's the Roches of the world and others, they don't even budget for that brand-new product in that first year because it's such an unknown entity that you're like, "Hey, I'll take the upside when it comes, but I also don't want to be stuck signing up for a number that I can't deliver." Now we're different. We're a cash flow negative company everything in our mind is riding on our revenue numbers, and we're doing everything we can to drive that. It's hard as we possibly can to maximize revenues this year, but we just aren't going to give out a guidance number.

George, can I jump in, too? just want to reemphasize something that we said back after the clear waiver that we know that leading indicators are really important, not just for management, but also the Board and also for shareholders. As Doug has said, it is a new product in a new market. And we've said it's going to take at least 1 flu season potentially to before some of these numbers become relevant to them in decisions of them, right? So I still think it's a little bit ahead of where we are today.

Great. Thanks, Sam. Next question. You've said that commercialization is running ahead of schedule. Do you still see the minimum order quantities under the full PHASE agreement is achievable?

Yes, and no, no. Listen, we want to do better than that minimum -- let me just say I want to do better, right? I won't give guidance around it, but that is -- we're feeling good.

Yes. Great. Next question. What's the percentage of customers that are switching from potential trials to active sites? And also, what is the expected time for a company to start trials to full adoption?

Yes. Let me take the first one, Paul, and you take the first -- the second one, which might be the timing which I have an opinion on as well. But listen, here's this -- the deal is we're really the key one is the top 100, right? They're going to -- they're the most -- they're the largest customers, the ones that are going to swing and allow us to hit the numbers, I think, the best. And the -- it will be very, very lumpy. I think is what I want to say. You could have it where, okay, if someone goes live. And take Wellstreet, for example. Okay, they are huge, right? They're now -- I don't know if everybody knows this, they're well up over 200 urgent care sites because they keep buying other urgent cares. I think when we were talking to them, maybe, they were around 140. I could be wrong on that, Paul, but it was on 40. And okay, we got to the 44-or-so online. And now the next wave of is probably going to be a very significant bump in that number. So I just -- we're kind of in that law of small numbers here where, okay, we -- if you will, on one hand, I'm saying I'm pleased with 265 but it's also a small number and bringing in 100 accounts, okay, that's a huge percentage, right? And like I said, it's just lumpy. And I think it will stay that way through this entire flu season. I think what you're -- that will be a tough one to go, okay, can I look at the funnel and kind of extract when and how many will come online, I think that would be hard to do. Paul, second one there.

What -- can you read the second question?

Yes, it was -- what is the expected time for a company to start trials to full adoption. I think it's asking from start of trust full adoption, what's of lead time?

It does differ, but I will tell you, it's every bit of -- well, if they want to expedite, it could be in that 60 to 80-day range. And then -- you also have by the time you get the economics and prove those and you've put it into your what they call an EMO system or Epic. You've got -- there's a lot of there couldn't -- there can be potentially some delays there. So you could -- it's anything from 60 days to -- I'm going to argue 90-plus days from the standpoint of evaluating and going into standardized adoption. Does that answer your question, George?

I think so, yes.