Profound(US:PROF)2024-03-08 04:35Financial Data and Key Metrics Changes - Total operating expenses in Q4 2023 were $9.8 million, a 5% increase from $9.4 million in Q4 2022 [51] - R&D expenditures increased by 28% year-over-year to $4 million, G&A expenses rose by 41% to $3 million, and selling and distribution expenses surged by 74% to $3 million [52] - Revenue for Q4 2023 was $2 million, a 60% increase from $1.3 million in the same period in 2022 [54] - The net loss for Q4 2023 was $8.9 million or $0.42 per share, compared to a net loss of $9.5 million or $0.46 per share in Q4 2022 [55] - Cash as of December 31, 2023, was $26.2 million, which increased to $45.4 million by January 31, 2024, after recent financings [56] Business Line Data and Key Metrics Changes - The company reported that TULSA is increasingly being used for a variety of prostate disease patients, with 67% treated for primary prostate cancer, 23% for hybrid patients, 7% for salvage treatments, and 3% for BPH only [32] - The installed base of TULSA-PRO systems reached 50, with expectations to grow to 75 by the end of 2024 [17][18] Market Data and Key Metrics Changes - TULSA usage is currently primarily cash pay, with a transition to a payer pay model expected to start in 2025 [18] - The American Medical Association established three new CPT Category 1 codes for TULSA in mid-2023, which is expected to facilitate reimbursement [18][37] Company Strategy and Development Direction - The company aims to position TULSA as one of the three mainstream treatments for prostate cancer, alongside radical prostatectomy and radiation therapy [15] - A collaboration with Siemens Healthineers aims to create a total diagnostic and interventional MR solution to streamline workflow and optimize costs [22][41] - The company is focused on building a high-quality installed base and executing a U.S. reimbursement strategy for TULSA [18][37] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the increasing adoption of TULSA, despite the current reliance on cash pay patients [61] - The company is confident in the upcoming reimbursement decisions from CMS, which are expected to positively impact utilization rates [89][102] - Management noted that the number of patients educated about TULSA is significant, indicating strong interest despite current treatment costs [25] Other Important Information - The CAPTAIN post-market study is ongoing, comparing TULSA to radical prostatectomy, with recruitment rates increasing [44] - The TULSA AI brand is being aggressively built, with the first AI module already in use for about 50% of patients treated [38] Q&A Session Summary Question: Can you talk about your pipeline and how it’s looking? - Management acknowledged the positive trajectory of the pipeline and the successful installations at various sites [10][12] Question: What is the status of the reimbursement strategy? - Management confirmed ongoing communication with CMS and expressed confidence in securing appropriate reimbursement amounts [89][102] Question: What are the expectations for revenue in 2024? - Management indicated a potential revenue range around $12 million, driven by an increasing installed base and service utilization [75] Question: Are hospitals concerned about transitioning to the payer model? - Management noted that hospitals might slow down in the second half of the year as they await clarity on reimbursement codes [90] Question: What is the expected impact of the Siemens collaboration? - Management highlighted that the collaboration could streamline the sales cycle and enhance the economic model for ASCs and hospitals [96][99] Question: How many systems are expected to be sold under the revised capital sales model? - Management estimated that at least half of the new systems could come from existing contracts, with the remainder from the pipeline [140][141]