PROF - Earnings call transcript Q1 2021

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Operator

Thank you for standing by and welcome to the Profound Medical First Quarter 2021 Conference Call. At this time all participants are in a listen-only mode. [Operator instructions] I will now like to turn the conference over to your speaker today Stephen Kilmer with Investor Relations.

Stephen Kilmer

Thank you. Good afternoon everyone.

to, pointing regarding this which the Profound but not by include call may treatment start efficacy pain is statements the and BPH, forward-looking and limited and of me prostate out technology uterine conference that will include, of cancer, Let Profound’s regarding fibroids in palliative expectations its osteoma. business, osteoid anticipates, words can believes, such negative such always, or not certain might, by be identified taken, would, but scheduled, including be intends, or will, actions, could, forward-looking expects, proposes occur statements or contemplates, plans, variations variations as words achieved. use or Often, as and events expected, of states be may, the of results phrases that of management. Such are statements expectations based on current the in differ regarding including materially risk growth a and factors, and the events call specified factors affecting equity circumstances risks conference markets and certain generally by known company, device forward-looking may with as could or risks occur and at and uncertainties and the economic unknown dates associated medical discussed this industry, result competition. of all not The the

required No differ Profound statement forward-looking from events to has factors to important could applicable those forward-looking guaranteed, actual to differ laws. that by results as Although or securities estimated actions, be results intended. or can described anticipated, identify cause in other may or statements, events actions, there that factors attempted materially cause except those from be

new or than whether by as undertakes on any statements, or obligation result update they required Forward-looking of to revise only statements are made, the speak no as information, and otherwise, Profound of which law. as events date forward-looking other future a publicly

Profound of tissue. to to ablation and story, disease who the of develops those would business. markets to moment the benefit like Profound summarize incision-free customizable for new our the therapies For take a I are

rectum a surgeon-defined technology is ultrasound control. closed-loop preserve are We prostate and MRI, temperature volume patient’s robotically the while a trans-urethral real-time The CE technology and ablation is functional XXX-K provide TULSA-PRO of predictable customizable commercializing Canada combines cleared and designed FDA. driven actively and natural the radiation-free Healthcare approved TULSA-PRO currently marked, to to feedback help urethra by that the protecting abilities.

We an that treatment for powder of innovative are Sonalleve also CE mesothesis. pain commercializing marked platform fibroids of is therapeutic uterine bone the treatment and

obtained by has the Products China exemption humanitarian Medical uterine for also under device a of of Administration osteoma. the treatment approved for recently been the osteoid FDA National Sonalleve fibroids and non-invasive approval has treatment

in not impact to we have and HDE expect making our it company are in for material this approval on XXXX. While term later do is a U.S. its significant commercial we launch for FDA revenues the a preparations near milestone

Aaron Financial Executive With that I and the over On call Profound’s are Dr. Davidson, turn the representing Officer the today call Chief Vice Arun said Senior of will to the President Officer; company’s and Chief Aaron. Menawat, company Corporate Development. now

Aaron Davidson

you welcome behalf afternoon, team for call. would like your of management to our at conference and thank Profound, quarter interest and first company. everyone, of On to XXXX Good our ongoing in everyone I the

are commercial in Arun on shareholders, continued a update I of moment call an we those who your will over turn For and you our the to interest for support. appreciate activities.

to will quick However, the currency quarter, reminder first provide things to dollar I presentation to of all financial we U.S. so or dollar rounded from we’ve on to been XXXX before numbers refer I’d our our approximate. do, streamline update the brief Canadian changed a have like the that A results.

in January our in significantly decline and the resolving Our months first by quarter, COVID-XX was February XXXX. since particularly XXXX sales affected revenue negatively first of QX performance impacts,

first down quarter XX% March month $XXX,XXX in the recorded revenue ended three $X.X of of XX, the period XXXX. company the XXXX, million For from

general not in already recent uptick potential fees for due G&A, have and the X% cautious sites in prior partially which near-term expenses believe to management mentioned by the to and salaries in about what has selling be timing first the and in additional $X.X quarter adoption press consists and quarterly continued an we by year increase higher XXXX. continue remainder during at existing the benefits restrictions. to first of in differences the an spending $X.X head due increases quarter of the G&A rebound for procedures increase and we decreased partially were of decreased down make of scope expenditures primarily on release systems in today’s the $X.X expenses We for the that compared result shortfall guidance to increased the $X.X in by was by into in factoring quarter, positive expenses we to with XX% pace and operating COVID-XX lower up as a bonuses commercial revenue agreement that U.S. overall our TULSA do and annual of approximately the that so Breaking formal to Total current and began to initiatives the TULSA-PRO while million. offset QX we the momentum business offset expenses year-over-year have we associated share-based pipeline. million March awarded by driven As travel and employees, million to provide with in far pandemic million, R&D or R&D, to financial projects XXXX. count compensation. basis, This expenses opt-ins of the accruals consulting XXXX to and earned to further distribution XX% R&D

first compared $X.X million and or common by expenses the million same period approximately XXXX month net or in of Overall, loss share $X.X increased share loss per $X.X a three the a million. quarter XX% for per $X.XX selling, to company $X.XX common distribution XXXX. net recorded of Finally, with

the turn Arun. over that, now XX, As XXXX, I’ll to of cash million. call at $XX.X December Profound had With

Arun Menawat

start in Thanks, the Aaron. like to would I by QX. revenues addressing

you lower translated were not as they for but will discussed, the expected, has that our see, Aaron year. into less bullish being than As

the Let highlight reasons me key why.

is earnings the the saw late pattern first and in established analysts March resurgence. season impact space January a First, similar We pattern. noted February most even as across COVID the similar various sell-side by followed company with quarter a seeing in this emerged have medtech

the recovery March However, the TULSA. a since of we of are wasn’t while requires make in that two shortfall. full game the procedure a are MR treating changing robust commercial quarter declined noticeable the up and for was U.S. early training in little and the to months Suite technology in rollout the enough steeper in likely first All relatively

in installed U.S. gain starting traction building a we’re Second, quality high to base.

in play reminder, a are three alternative which imaging end hospitals. users; strategy Each types entry one, U.S. our adoption. As leading market short-term for treatment; adopters, and urologists targets specializing to early includes of two, independent in these center disease both prostate and supporting expected different cutting-edge teaching companies; three, TULSA-PRO roles of opinion long-term

XXX or be the run being operational, XX of believe XXXX those we will procedures first to XXXX, and were year, exceeded an that Our by Angeles significantly targets have as variety about XX% early of early to is and quarter, their procedures achieving restrictions adopter after first patients. in related by Los rate imaging six RadNet’s to not sites average Pacific XX would continue XX the West more COVID Today, per the respect Liberty while At average eventually increasing months treat increase the now number travel growing recovery of continues. the slowed initially as in center impacted and company of they patients center run treating rate still Hills by centers a to group, With we that. the procedures run after COVID-XX. second delays after rate using COVID estimated in per an to these TULSA year, to experiencing TULSA-PRO growing actively beginning XXXX continue that

you announced total agreement network know, U.S. a States. Acumen XXX and across operating also sites of a seven As XX has most of in Acumen multi-center last we in week. Florida currently clinics its TULSA-PRO with

over will and of Acumen relationship of men’s installs a the next ten investment impressively TULSA-PRO are on initial to I’m health. their geographic TULSA-PRO or Texas be to be. to based operational centers. follow, to Acumen The of future men’s We Pennsylvania include highlight group are install first our focus expect upon with fourth making the up where Acumen that targeting. to will outfit first XXXX. in anticipated to first year to so health significant focus Florida, that we the new pleased centers be part they’re expected as additional in the expand of the we third success the to the men’s in at centers install health these quarter site is to XX systems centers hope

the as listed We prostate at expected with the to hospitals are Cancer yet. mentioned would San be Prostate all U.S. while I perspective the the couple Methodist with Rochester. quarter Florida, signing leading in Antonio. QX, the before, Harmon Stanford, these Jacksonville, or that A Southwestern, first first Yale become they University same once the like All Rochester was have Acumen point Mayo, Center up patient’s live added $X,XXX new Mayo, the Advanced markets active our Cancer to higher our yet. Texas, From the renowned largest go agreements around live in we Johns tulsaprocedure.com of site agreements Memorial with UCLA, price end of top geographic agreements, remains have and will that country. in per In In the year. locations Rochester summer the of patient. in commercial and WellSpan exception site I TULSA-PRO on timeframe running. mentioned agreements and of the Texas of go are and But Hopkins, the have and are And is tier of they best the for hospitals institutions California, represent Center, Northeast, we care

believe, hospitals presenting relatively seen at to long-term medical journals. urologists publishing adoption conferences, by we volume to COVID-XX. best to the positioned lower first. have continue generation and drive of of are these we expect still being be While at TULSA-PRO next institutions in impacted papers We relevant particularly training And they by teaching

operating starting of sites To impact remainder the We we are of March, to adoption have summarize United the and of Urology. XXXX States, the of are featured TULSA-PRO XX looking to on Journal the XXXX of in see increase status usage they cover and the with in beyond. already that the TULSA be

number of leading believe indicator sites, have which opinion is also an of We we early future adoption. a significant

in yet in primary remain for These base. COVID-XX installed Finally, our spite a have the our hands administrations contracts quarter our more now we in why result, are on TULSA-PRO the still momentum new functioning. we QX QX of best of hospital as system current installations were our revenue. was regaining agreements signed in And than terms as our confident reasons effect

we that strategy cautious, TULSA application filed continue full our what supported remain bill hospitals pleased by hospitals getting to be until is C-Code procedure. are and are to Medical TULSA interim continues CPT-X the hearing Association. Although, again, we generally the leading we paid. And that are for can utilizing also the if for This to be the be American that

would provide Next, application. on CPT-X plant like an to the I update the of status

sufficient societies, the feedback, clinical We we initiated qualify that on the that anticipate adoption In upon believe the CPT-X relevant requirements get with later the year, XXXX. we their initial usage our for for feedback in will to Society support to the including that TULSA to we as to the publications likely and file continues procedure have publications to application Radiology of short, be the continue Based American increase, intact. TULSA may and the the on American Neurological of meet the anticipate, this get CPT College of application. we if this remains need end strategy dialogue to year by we requirements

provide conjunction the This not is one exists, is filing application year, of likely specifically with data full the one study combination describe the coverage continue clinical additional if requirement the treatment a not support be The procedure will by over that study, developed with has two is clinical our in to end trial trial prostate the application radical designed To TULSA this prostatectomies. including recruitment equals also year. of will but called and and was study in Captain run design may and States data payers parallel central include CPT-X safety procedures trial anticipate be only this measurements non-inferior, TULSA the insurance pursue efficacy, QX but obtain versus that of support begin board, Our XXX and to already against run and study published prostatectomy that to the that to already be of with been code, to it further also as the radical for effects cancer. level support the is will to will N approved by significant The will we of strategy briefly progression-free will clinical endpoints in United one with primarily CPT-X XXX level XX adoption. survival and randomized to the side compare by advisory be primary a The the IRB. in time. patient

include to targeting well of are both sites XX will We sites that part about sites. TACT, and were XX as as sites they new

majority that is along anticipate the basis. patient informed to on recruitment periodic continue time, by will meantime we on published that later X.X the the coming initial patients will the anticipate three-year recruitment from recruitment will a you completed data be year. of be will will trial keep In TACT and trial this also this well clinicaltrials.gov in We The patient The of we begins. end about U.S., be year. be TACT

aware one be will that submitted level XA for addition, XB two additional of this level later In study year. studies additional and publication we’re

the a impact. up echo to the to our comments our with We of in QX macro near remainder experienced spite the revenue we uncertainty the would as COVID-XX team while mainly that to executing the that remains due rate the year, throughout term to event, believe In there we make has shortfall, Aaron’s like summarize, procedures So have to impact remain very potential in bullish adoption COVID-XX the respect I of well. been and about business. of TULSA

over TULSA-PRO signing XXXX. pace We have been additional at side increased agreements an

and adoption, see of to strategy treated TULSA-PRO in procedure COVID-XX continuing both reimbursement TULSA-PRO’s happy in reimbursement by we’re specific questions impacted a and code have. any terms by as patients progressing are that, not and conducting Operator? for We today. might you apply CPT centers, ultimately to to types for volumes, broader This With studies our we’re additional remarks ends a determination. prepared take of

Operator

Instructions] Thank you. [Operator

Aaron Davidson

million. As you have was comment our December do I million. March was that XXXX XX, that $XX.X I Thank XX, said I cash said XXXX you. $XX.X operator, should should at

Operator

from Thank you, Anthony sir. And of Jefferies. line we question do have Petrone a the with

question please. Your

Brianna O'Toole

Yes. a Brianna for Hi, couple. questions. Thank for I have Anthony. this you is on taking our

be you when these expect delays to and of So follow-up last backlog And the given would five up then in newly targeting by first regarding year running? sites roughly and the that contracted question my as in – quarter, be XX quarter, you do sites installed still to end? are the one quarter

Arun Menawat

afternoon. Brianna, Yes. good

So, this described slated are the be most that to sites summer. I operational of

in that anticipate latest most would operational of July, at end sites, the the by be will June I are the of So, end of two sites that there QX. by

One of Rochester. them is Mayo,

are one second signed sites To other about operational. with The site have the I mentioned, we we XX your is that for Acumen. that question first the agreement as

already agreements hands. in more our We have

And do be to make good have think, this see because better of to we problem able XX we so a do that We getting already frankly, that one why able And QX. we the to XX fact we the should be believe reasons than agreements will not these do this we at a with up that. quite of the is year. moment,

Brianna O'Toole

installed systems in then That’s the potential And across the Acumen what how any States? Texas, very ahead, the centers and Pennsylvania. Florida, deal, Illinois to other Delaware, regarding XX be then expand many helpful. is will And across just initial looking

Arun Menawat

in focus States focusing an are the Yes, of is systems most at then it would of be, and likely impressive then first are will to one Acumen on. we The a certainly And think later to be Florida. half say important or systems few towards that idea on and Florida, I or of ours, so on it’s majority the least we of slated another than systems there the they Pennsylvania. would disease States, we pretty the five are Texas happen strategy And Arizona two – And I prostate we as is be majority be other the Texas, just other the strategy California, remaining the but the and patients. And let is and me strategy. I patients that The more an strategy has will cancer the Northeast. that Florida quickly strategy. mentioned, about that prostate think in talk

And So treated. are will those as of one it next. on become numbers, have as can by sort state focusing we that go think mimic supply so the think strategies these then that people States, to they that and higher awareness will state want and large get higher we make increases, in the of I availability, to we grows sure able the centers awareness TULSA-PRO the be aware and from to we sufficient

is So rather we’re our scatter and your in the that than around putting them question the resources. Does try idea in, of beginning States these whole country, to, Brianna? key that answer all the leveraging

Brianna O'Toole

Yes. very I the one procedure helpful. more That’s on mix. question have And

done the through of then are what into XQ and cancer moving have procedures prostate you with So, – been and high-risk prostate even then into that intermediate the mix off-label and BPH cancer? low-risk is XQ,

Arun Menawat

Yes.

but increasing are now we it’s in treating XX% are patients Brianna, So the perfect that patients are think of I I BPH of numbers, the that about general very my treated the think is that guess in these best category. that general a being number BPH comment not right is

to the in done. teaching that the think institutions, the low institution, patients. question, we’re QX, are very in maybe they think XX% that I in is were Europe which in we probably number prostate I Europe, patients undoubtedly trials are higher, what the been teaching looking are little clinical seeing That’s what is interesting cancer because follow that seeing have think in that I of a but an

capsular that which as to be for the X, they leave a combination mid-grade sticking patients, a might they another early a are as activity are cancer where extra patients patients or there They then, combination. treatment. patients they’re high think is treating adopters, they’re even slightly with Gleason that which much rest for as the are continuing the looking and are, relatively where, need actually to risk patients, increase bulk more So TULSA that well. be have may a upgrade And they to may

physician he actually was a largest BPH, treated So, been seeing And we variety. CC patient they TULSA. even started me, telling has was a we And before today, a are a the treated today. good pretty XX I with talking minutes in prostate, XXX just with prostate with that

they that So, that confidence be the is believe this are technology flexibility reason of majority definitely the another And a testing the I the can patients TULSA. with treated certainly that, limits. that versatility we and large the for do think of is

Brianna O'Toole

Thank so Great. you much.

Aaron Davidson

Brianna, I is off-label. BPH comment, to Aaron. just is That want this not

tissue, prostate for specific approved or ablation of We’re not whether to malignant the benign. it’s

Brianna O'Toole

Right. Thank you for the clarification.

Aaron Davidson

Okay.

Operator

you. Thank

with Our from James. question Sarugaser Rahul comes next Raymond

Your question please.

Rahul Sarugaser

so Arun our afternoon, for much Good and questions Steve, thanks taking today.

revenue thanks that helpful. isn’t for addressing the even upfront So,

expect currently many like? QX, would goal QX figure would to be operating going a of, our to and in what it to recognizing of math own revenue the don’t out, hopefully or able installed guidance talked of end the that can give about provide install-based to and by us the sort little year. XX from as rep visibility do more result, Are then that we So you be we in look and we’ve a the you terms then beating XX how that

Arun Menawat

Yes.

in April things. talked was January, prepared So We open, our March. and been we think March hospitals the say than remarks. better where saw better I has is would two are, are about as Rahul, February we than I One

and able to are go to now hospitals start installing. We

I the we do we So, be, agreements enough do – you mean, have I to enough math, have agreements double-digits already. to if think

expectation. little two bit isn’t my a a XX, we’ll would you activity I best least would would next but quarter it month, – in Again, we to it’s a reasonable can. bit installing four will So, of one see is installing, here be system quite probably to say September, I still the to a at unpredictable, say, from be

Rahul Sarugaser

over kind excellent And adopter seems rates then When sites, the high referenced per That’s relatively that. when there you with year of XX look Thank now Terrific. much utilization – an the annualized. very reconcile of there. for a this to the we level visibility. the revenue early you – bit that operating asymmetry at moving number, we at it’s

then none. because rest for back if the essentially teams – calculate So, installed base then of they’re that to we the few doing

how them average? So, as of rate rate an about base, and average install the attenuated across trained thinking up? that be be you installed How devices that, thinking course, we recognizing an should should get we utilization we as about

Arun Menawat

Yes.

just you’re more going Rahul, understand And let start me the with where time. So question. I that one

I have we in have after contracts think enough part confidence what coming it this is that, go part the of rate growth of to to systems. fact the already that do that the returning from reason able install COVID, said we we be

So, installed can get think we to we we the base. know,

systems And up is more than very, older the then which systems, so I new going soon along year with a old. say, more those lines, very to we’re would end

So, those that, second want in what also types very, of I I after to months very, going the we entry rate going every get do that XX to them to It’s XX the the channels to is open strategy have take run systems about emphasize of market there. away. be of point year initially three And is that going very continue per a I is before differently. that customers. that want think rate these looks to And that call to thing to or disciplined is behave do very one clear new right I and be we not six

XX think to early overall, first going year better think than they’ll that. the than the with actually they’re I I do adopters, this Even so better that. plus And they’re do quarter,

to to Gleason more going five hospitals to X relatively, even or or a spite at, higher before go going I the to to think patient ramp the might of say, up, I different I’m look I see. do I be own Those outcomes of train going channels on physicians want are really XX I in that to couple I’m or data three or my risk, a actually before going four disciplined. clinical a are

we realistic to respect rate So, I be, run that should with do the teaching at think large the hospitals.

another, example, I late any is said we, delayed, one started again, year. signed belittle Now March. we give did WellSpan the can of hospitals Again, you their they that patient got last first again, the we that in having contract they that

the put LinkedIn of second they thing on like all treatment the The all own physician. patient, did physician images by whole the, itself, patient and his information the the the the with the the whole, and whole website done it’s

than the So the I’m see, liking see, with they patients And the way increase imaging but they’re confidence good Acumen, but to the very what I think we’re with saying, not even treat. to I really in look, until of I And same think what they center going time, to start that at types on we RadNet I me it I, I’m, very QX. are be delays. start but should like better a still the off they’re that, measured I side, do gives going

you we realized about it remain and details why about share the rates And of quarter every the I want on. and this things? minuses open more and why very to [ph] and so with more pluses I is little but clear cautious midterm we’ll bit on volition, that this a short-term is be adoption So, and here, and reasons again,

helps. hope I that So,

Rahul Sarugaser

that more Thank excellent. around reimbursement. for And you’ll question you one clarity. Yes, indulge, if that’s just

Arun Menawat

Sure.

Rahul Sarugaser

but how bit C-Code is bit talked are initial? of Last that and And to on hear also as maybe this adopted quarter, a hopefully the of of C-Code. always around little Are you give you part, other great a code about the between Can you of on C-Code a end talked able the is at bit more more by of just give application? also in and speaking clarity jurisdictions an you for CPT very us be it’s whether looking then this to us the course, second you’re you, little rollout around this year, terms to little XXXX cautious CPT towards update some starting submission the end than that the year clarity strategy, of that about bit a given the, distinguishing XXXX. the application that broader

Arun Menawat

I’m Yes, to. happy very

comfortable where insurance strategy, with clinical payer they can soft and get I becoming continue strategy, reimbursement to in And who get that we the are continue through – Medicare seeing they’re cases to So and Rahul, C-Code who more majority insurances, The patients patients in not to sense being present are paid. the new data likely are that add terms clear and a need the would hospitals be that the work. hospitals something. in, it’s say patients, honest, fairly pay. treated are same patients work at there’s those is to becoming, the who new to strategy to of outcomes they the to who the of have again, comfortable paid with measure, I billing in technology that with this agreements hospitals are getting for signed to private are The applying lot see

that we happen. continuing comfortable. all think to And continue I is to remain pretty

way honest, to On be fairly side, with we’re the CPT-X pretty again, it’s good, happy the progressing.

I As College reimbursement Urological it’s deliver strategy chapters believe available that need American that believe chapters, we that prepared we going be we to we’ve that can we’re which remarks Society said, we and to looking RSMA. of a can, from to if of the like very us. various in we And getting the with the societies the positive and that would terms in the picked support Radiology, the they top what feedback of engage is are chapter were the American the societies

by But And so year. our where we sense that that little more do bit the society. maybe qualification get also think to by be to believe of be, or where we was to was we’ll get we more supported a that want point bit more, to in the we we that be little able comfortable, we qualify to that will this months not it’s a I get goal positive four honest, are point end Then, we ago. only the will

the is Medical what will XXXX, means and so all end once Association. application the early American And some them, ruling process kind XXXX. the we administration have that we of should that of from And qualify start by in

So anything, remain process. I said, comfortable direction the I as hard of not pretty these overall, that’s are kind we or with. that the numbers think And but

Rahul Sarugaser

back my Great, much so the get in for thanks queue. taking I’ll questions,

Arun Menawat

you, Thank Rahul.

Operator

you. Thank

is from Josh question Our next with Jennings Cowen.

Your question, please.

Josh Jennings

ask I the here, to the record, just about that funnel first channels Thank an was in the and new sits us status the funnel I that hoping earlier? on you. Good talked congratulations sales Arun sales today could where just of update in those hoping three with was and about you each the agreements give success, TULSA-PRO you Aaron. quarter. afternoon on

Arun Menawat

I Josh, know we in Sure. so system over XX domain the that there agreement Acumen has started been that Then think XX QX months. public over prepared are remarks. the

there agreements hospitals then call we four are be early our we year. at are are at – leading in the have And I adopter think would I I think, least that hand another that installing that channel. agreements another on this what couple that of that the in described from least we summer

and not looking then, you’re contracts quarter prior installed. of terms at have that have So, in we contracts been

So over honest, already be you’re at, XX, our in to looking hands.

Josh Jennings

for hope There’s pre-contract was completing that your you’re understand, thank not I – but sales information, wanted lectured my funnel that sure have continues isn’t but just in that you started, sales to where continue mean, making that efforts the just but still, kind it’s question to that, I be and where it’s that I days, that being success. It it still as And funnel early still flush. are such leads also to is been, clear super it’s our depleted that I of still funnel assumption to, pre-contract added full. excellent. That’s your in

Arun Menawat

patients Yes, the from feedback is. I anything Yes, urologists. don’t terms Yes see changing or in also of [indiscernible], see, Josh from don’t it the absolutely. I feedback

site fact, increase In is looking every utilization. to

Josh Jennings

the on I think build than updates other cadence and just hoping or agreement we into repertoire how center was imaging could and centers those focus on just to there’s their contracts that in board then should two. And over running or RadNet center imaging imposed with the more that up any couple that already coming I the could of And Acumen to And first on was or another there’s one congrats Acumen any Excellent. think the where companies centers RadNet TULSA-PRO are potential regions, on a these now. said to RadNet about you quarters. add having the agreement, on other center you on XXXX, come channel share

Arun Menawat

Yes, absolutely.

I think I attending weeks and I ago. site and first And are case now had group, and refereeing educating center physicians So of site treating imaging RadNet in up is think the talk patients urology the the then few of a the running the one and pleasure our process in that whole channels, we whole they their physicians. their infrastructure, referring of about

educating referring RadNet the So groups. is and is first site that running now their now

happen slow to and anything, going but steady. in obviously not one quarter So it’s or

I should the I are, over the we really and we in as those soon have assigned. I unfortunately the like as mentioned Southern they as was to hard before. the they overall going we RedNet COVID, those, are in to But California be they so the say on region, think generally or other even are two XX have, months some did be, sites the that sites believe infrastructure installing but come think needs that ramp. And are include not them hits numbers I of MRIs a other identified will to think things continue and And we I next stream. new being less. on know And I sites dates, particularly the I will, then we would that there because

So, prostate I look at your and covers question, United about States belt XX% of to it when but answer I the warm basically of think the other that, cases.

is, Texas, the next our So setting priority Northeast place. Florida, California, is and Arizona, then

us focus belt on we see So, little Southern forward for bit I the continue go a as more think will new agreements. to you

Josh Jennings

about sales, questions. and think the in and centers over on wondering weeks? TULSA-PRO correction just the about for how Great. lot. taking a last those Thanks Thanks should new Europe And any two then question, Japan updates TULSA-PRO we

Arun Menawat

capital selling we But important, things no important a for because we basically question and can a revenues also see quarter in the of believe particular United the the revenues for very which important good as had that just number. really normally get, the Japan, affected are interesting, particular we also. because Yes, them to we of we us. revenues sort of Josh, quarter, in new in be those that’s but capital which we this market as is and do strategically top-line very also was And outside revenue, States one Japan in that revenues, see very not is those

getting number you and And sites has Japan been in give us. little more shutdown a also that to establishing important mode. going So color is beachhead bit of to a

been We able to have not travel.

COVID, six We So continued we no able the that And strategy. with the the the the on in months have working to had over wave but our no QX. as, with regulatory is there. say to been you government we’re know, That had there pipeline year, that not there. last pipeline we not approval stale, first working also the capital fact last our travel flow, not so even of get that we to reimbursement to closure. is authorities are It and the is or

ago have will as Europe in term, should in guidelines I the think XX important. second is midterm, government ablative where again, I the moving therapies in the but think, out see came earlier I quarter. it that hopefully European near days some very come this see they’re accepted. think as So, not from just experimental back positive in And year, about impact. two you change international And We later early sales

travel that and countries the you see So, three other was QX nod revenues with well see did and we so think as these line, I do important restriction, China, of – will get well, that the I bottom Japan, Europe, Asia quarters but and on, was international represented, think not we as from and the perspective market this year us. for the not from

Josh Jennings

Thanks Great. again.

Operator

our you. with question Frank Takkinen Lake Capital. comes Thank from And next Street

question, please. Your

Frank Takkinen

understanding I work understand, hoping installed, that better process you significant the more first signed likely the long across a to customers trained, Hey, to patient through Arun, a the given with process from and a on little wanted want can variation then better total clarity on agreement, there’s clarity on average, to I takes questions. pre-signed customers. guys as funnel agreement looking taking conversion treated, get as little just time how better start for my give and thanks well. us

Arun Menawat

we XX on to the what to COVID I at talked too yes, receive patients Yes, then XX it’s sort this though, to market XX when and question. kind the about it’s the done. can the start days but so that is an days and another in did January, agreement, to our it’s before so get looking think in to I we’ve product a typically good obviously it’s And installation treating about the And that, time would introduction XX COVID the from on. typically of we that say started moment, before, days really What days retrospect, is – big. we would install here, prior gauge best way of we be of the

XXX of over a the days. hopefully it we So is further We diminish XX time then that And say, this will the days patient XX at first we I diminish would certainly maybe haul, think treated. to the will sign over by days. average contract XX from time probably to to to end long days a number to moment, year good think

TULSA Some of at distribution the took moment system. the looking perspective MRs the few that see will sites from of agreement that we new you a bi-modal to buy bit a a are little have place the

wait of to that are it same we and bit the labor been that get times MRs delays installed. things have But continue the time. to a to And a little bit the over finding harder. better till all related of there done will these have will the little all And because so things during get

go be So, little where bi-modal we can to to existing where you take closer It’s do have will installed. new three to months. we a ones MR of six it’s going MR a four distribution, bit to a to probably the the see months maybe

Frank Takkinen

That’s you going ruling how hearing the following what for your of the CPT-X the submitting end this the end Got up effect? but stay – by beginning is then around out looking around of the a little XXXX, conversation with on helpful. set CPT-X the it. of XXXX, And into you also that if and a far guidelines into future, – up understanding does

Arun Menawat

to the – say receive out, submit apply into let’s it you then know pretty next So that once for year by typically AMA it goes it before going will we’re it, the we to we receive not. if we If is AMA by or much the the it, XX if into of they start standard And process. effective with reimbursement as provide look associated associated target of the costs by in it. And goes the and following committee becomes the code year, to with the within then recommendations it January. it. months And application at the

once talked full these and assumptions usage C-Code. C-Code about just the and be well, before are working feel towards these we us that If is are to the as this January own payment what are onsite, societies will the so all point. assuming continued we’re pretty continue about of would far So at and which strategy, publications with is against mentioned, the beginning our other beliefs to done that this is I XXXX everything the respect good and also interim the example, that reimbursement we right? going as So effective we’ve give typically, thing have strategy, to confidence in again, moment happens theoretically. the C-Code the that’s at And

will XXXX then you that January have Those to meantime, supporting CPT-X well, us. are is, that’s is look to applying So, a want operational. supporting us you think milestones society goes the XXXX all for. I for if of And C-Code kinds the in what see code, full the then in

Frank Takkinen

capital a And Aaron, line? confirm on helpful. with you TULSA, Last that is in I broke I little we’re just associated each you from a included just page. of revenues but so one wanted procedure And we’re per pay sure assumption for could then a the That’s the Great. differently summary is me non-capital what’s to us recurring give and that. right have the you equipment out non-capital in My recurring. bit saw than past revenue to

Aaron Davidson

Yes.

So in disposable we the that’s the bucket of procedure other same or pay in To of per called me, different parts all sales. called parts, recurrent. we world, non-capital

we So, like even different in it’s because the contracts use and service slightly that, of where world, different recurring, terminology. parts things

think, give piece people we is and of have a have when get sales do versus clean like nature tried what that have think we to, paper even we up I them really we procedure a capital recurring disposables service. a to it When what sale, one-time do So, sell to do know.

confusing and buckets, And so we clear bucketed recurring. our people product we into that different a parts those of it because to one-time so lots two up of create getting different terminology, this the was kept for capital questions tried just and to world about tried of clarity

Frank Takkinen

In being… that it. Got bucket of

Aaron Davidson

Makes sense?

Frank Takkinen

bucket for that doing my Thanks appreciative guys. in very of of Yes, taking absolutely. so. I’m being questions,

Aaron Davidson

Okay.

You’re welcome.

Operator

Thank you.

Ben Our next from question with Haynor Alliance Partners. Global is

please. question Your

Ben Haynor

the Good for taking afternoon, questions. Thanks gentlemen.

quick ones couple of for me. Just a

on point I say variability if contracts higher the go? correct? price the if or – Is can $X,XXX that an oral you newly signed that that heard That the is that higher higher. on to so, Aaron, if off, aspect how there’s First I much what’s think, and

Aaron Davidson

in of took see higher. reasons about increase expect don’t much We really too like So But sensitivity take price it. you’d end that talk it twice. about of took effect to to just the type like with March. And drugs little I a XXXX it’s typical assume a for on a is want the inflationary increase to customers,

Ben Haynor

XX% like these days? So

Aaron Davidson

No.

Ben Haynor

cc this and an opinion good I know have you something one, for pretty like or really guys about is question, some the folks of it a but them it than definitely into like where and not makes is something a XXX where pipeline, earlier clinical things, notice years anything. second up it pretty sounds so – What But do suppose, data visibility their you full a may kidding. think more just you and about guy that gal mentioned TULSA-PRO hearing or does prostate? it take Is more opens I’m more? it’s my

Arun Menawat

question. make Ben, the I me sure let understand

So, the on you’re agreements us? people with are asking, is signing what which criteria

Ben Haynor

it about a next thinking hear guys oh, people kind this of the you oh, makes being that are What journal TULSA-PRO and the is that about, for treated, wow? years with multiple maybe to identified you aware of that just of prostate stuff, customers the potential or them but treat, think that are unaware and and is already you all wow. cc, do if say, able that say, I’m a folks fashion treat in publication that, really being and that XXX

Arun Menawat

don’t it’s the I we Oh, I and I data. to think we clinical want we hey the I that, today, you more be to think see a when clinical what say question. to is lead would that it’s, see want mean. Yes. that go mean, data hospitals combination the things. people honest, to a ago of see And year

I think is clinical the people there. data understand

necessarily I that variety not can treat the you obvious. they patients the with something see that PowerPoint them technology definitely up, just think that of wider when perks this because a that’s is concept

be a create are go community training certainly we to we I where be and we will programs of forward. working that And driver. all Atlas do an actually special so proactively our as we presented these And urology to will the cases think believe good

one that that’s think I factor. certainly

The the thing be of and be and to patient to the is pain at that’s the is to inside in the nothing is the response, else, at home not only days within about you’re a anesthesia four second really home able five go grogginess you and about stuck TULSA all. few the catheter is from complaining no have for drive hours and factor continuing or and TULSA and go again, what I think

think that’s driving. other I one things that’s of the

I – to I honest, would, Ben, be you, to I you you look LinkedIn I WellSpan, so from And see, at think the encourage doctors… would will think side I mean

Ben Haynor

Yes. across run have Yes, I that.

Arun Menawat

It it. that’s like is driving – what

this they is going are they are I site a and and about then on. the treat, capability is think new when what you they physicians, that’s that this, excited leading this seeing see all

what’s driving. So, that’s, I think

Ben Haynor

Thanks appreciate That all sense. That lot makes I the makes a have. color That’s gentlemen. sense. I there.

Arun Menawat

you. Thank

Operator

Thank for remarks. final Menawat this session today. will back concludes you. I turn our And Q&A for to to the Arun call like

Arun Menawat

for later the coming much. Thank look you before again, so your I to we the And Thank thank that, support. And And you this report. that’s you month. so guess QX much. forward AGM up

Operator

you you participation and Thank you may everyone. conference concludes disconnect. your call. now today’s Thank This for

Profound Medical (PROF) 13 May 212021 Q1 Earnings call transcript