Procter & Gamble Q2 2024 Earnings Call Transcript

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August 20, 2024

There are 7 speakers on the call.

Operator

Good morning and thank you for standing by. Currently, all participants are in a listen only mode. After management's discussion, there will be a question and answer session. Please be advised that today's conference will be recorded. I would now like to turn the conference over to Michael Polivu.

Operator

Please go ahead.

Speaker 1

Thank you, Yoni, and welcome to Icetare Medical's conference call to review the financial results as of and for the 6 months ended June 30, 2024, and provide an update on recent operational highlights. You may refer to the earnings release that we issued earlier this morning. Eyal Shamir, the company's CEO, is traveling and due to a last minute core communication network at its location, is unable to dial in and participate. Therefore, joining today are iSecure Medical's VP of North American Sales, Chad Good and the company's CFO and COO, Ronen Zimmerman. Before we begin, I will now take a moment to read a statement about forward looking statements.

Speaker 1

The call and the question and answer section that follows that contain forward looking statements within the meaning of the stated forward provisions of the Private Securities Litigation Reform Act of 1995 and other federal securities laws. Words such as expects, anticipates, intends, plans, believes, seeks, estimates, and similar expressions or variations of such words are intended to identify forward looking statements. For example, we were using forward looking statements in this presentation when we discuss upcoming regulatory review process by the FDA and its Medical Device Advisory Panel, the expected timeline for reporting interim analysis of iCEPRET kidney cancer trial, the pursuit of regulatory approvals in various jurisdictions, including with respect to reimbursement codes for physician expenses, potential demand for market adoption of iSecure's newly invasive cryoablation technology advancing regulatory, marketing and commercial strategies and our belief that we have resources to execute our clinical, regulatory and commercial objectives through the end of 2024 and into 2025. Because such statements deal with future events that are based on iSecure's current expectations, they are subject to various risks and uncertainties and actual results, performance or achievements of ICE CURE to differ materially from those described in or implied by the statements during this call.

Speaker 1

The forward looking statements contained or implied during this call are subject to other risks and uncertainties, control of the company, including those set forth in the Risk Factors section of the company's Annual Report on Form 20 F for the year ended December 31, 2023, filed with the SEC on April 3, 2024, which is available on the SEC's website at www.sec.gov. The company disclaims any intention or obligation, except as required by law, to update or revise any forward looking statements whether because of new information, future events or otherwise. This conference call contains time sensitive information and speaks only as of the live broadcast today, August 20, 2024. In addition, during the course of this call, we will discuss certain metrics that are non GAAP measures and we refer you to the reconciliation tables and other information about these non GAAP measures included in the earnings press release that we issued earlier this morning. I will now turn the call over to ICER Medical's VP of North American Sales, Chad Good.

Speaker 1

Chad, please go ahead.

Speaker 2

Thanks, Michael. Hello, everyone. Thank you for joining us today. As Michael mentioned, AL is unable to get on the call due to last minute network difficulties. So I will provide his business overview.

Speaker 2

During the first half of twenty twenty four, we continue to experience increased demand for ProSense as evidenced in the 20% year over year sales growth for ProSense systems and disposable probe sales as reported in our press release earlier today. While the growth is a positive indicator, we believe the level of enthusiasm, physician engagement and conversations at medical conferences specific to breast cancer and other indications along with upcoming catalysts over the rest of 2024 and early 2025 may have magnitude of greater positive impact on ICURE. Moreover, in December, we anticipate reporting interim analysis of ICGREID kidney cancer trial. During the Q2, the FDA informed us that it will convene a public medical device advisory panel later this year to obtain independent expert advice on scientific, technical and policy matters related to ProSense to help the FDA make a sound decision on regulatory approval of ProSense in the early stage breast cancer. It's important to note that the current standard of care lumpectomy is a surgical procedure and is not regulated by the FDA.

Speaker 2

We believe the FDA's decision to convene the advisory panel demonstrates the extreme public health importance and specifically women's health importance of making a minimally invasive alternative to surgery available for women with early stage low risk breast cancer in the United States. As a reminder, ProSense is already available and approved to treat breast cancer and other global jurisdictions and our objective is to ensure women in the U. S. Have the same access to the same care and realize similar benefits. Our team receives numerous calls from women in the U.

Speaker 2

S. And around the world who have recently been diagnosed with breast cancer and they often ask for the nearest physician or hospital that uses ProSense. They are willing to travel and in many instances travel by plane because they want to have the choice of a minimally invasive treatment to avoid surgical excision. The wealth of evidence that has accumulated including our I3 study and the growing number of independent studies, we believe make the advantage of ProSense crystal clear for people participating in and watching the advisory panel discussion. The data from our study and the 3rd party investigator initiated studies have been consistently and overwhelmingly positive.

Speaker 2

In fact, we believe that this transparent and public forum will raise awareness of Prosim as a non surgical option and therefore support its rapid adoption in the United States, should the advisory panel recommend marketing authorization followed by FDA granting such authorization. Our U. S. Commercial sales team is prepared for the initial push. As a reminder, a reimbursement code for facility expense of $3,600 is already in place with more reimbursement including the physician expense expected to be applied for following marketing authorization.

Speaker 2

In our ICE3 study, the patient and doctor satisfaction rates were both 100%. For the analysis at the 5 year follow-up evaluation, 96.3% of the subgroup of patients treating with protons cryoablation followed by hormone therapy were estimated to be free from local returns. This recurrence rate is similar, is very similar to that of surgery, the current standard of care. We are confident that there will be a strong demand for cryoablation to treat early stage low risk breast cancer. In Europe, we continue to see excellent clinical results from independent studies investigating cryoablation of breast cancer among varying patient populations, including in more advanced and metastatic breast cancer and publications such as the British Journal of Radiology and a highly influential medical journal of cancers.

Speaker 2

Promising clinical results represented at the 32nd annual meeting of the Japanese Breast Cancer Society where the demand of minimally invasive breast cancer treatment was an overarching theme. Our team attended and we were very pleased with the high level of interest in ProSense. Terumo, our distribution partner in

Speaker 3

Japan and also the largest

Speaker 2

medical device company in that country, plans to file for regulatory approval of ProSense's early stage low risk breast cancer with endocrine therapy in the Q1 of 2025. All of this data as well as the data from clinical cases conducted from around the world will be submitted to the FDA Advisory Committee panel. We believe that it will be a very positive factor in the panel's decision making process. We believe our activities over the next several months will enhance our performance post FDA clearance. We are planning to be very visible at numerous medical conferences in the United States and in Europe, where we will be engaging with our target audience, including interventional radiologists, breast radiologists and breast surgeons.

Speaker 2

Now I'm going to turn it over to Roden to go over the numbers. Thank you.

Speaker 4

Thank you, Shat. As Shat mentioned earlier, growth momentum continues for process console and disposable cryoprope sales. For the 6 months ended June 30, 2024, process systems and disposable probe sales $1,650,000 compared to $1,370,000 for the 6 months ended June 30, 2023, driven primarily by higher sales in Europe, the U. S, Japan and other territories in Asia, partially offset by a decrease in sales in China. Total revenues, when including revenue recognition and other services from our Terumo agreement in Japan, grew by 6.5 percent to 1 $750,000 for the 6 months ended June 30, 2024 as compared to $1,650,000 for the 6 months ended June 30, 2023 due to the increase in the sales of process systems and disposable, which was partially offset by a decrease in revenue recognition and other services in Japan of $100,000 $274,000 in the 1st 6 months of 2024 and 2023, respectively.

Speaker 4

Gross profit for the 6 months ended June 30, 2024 grew by to $799,000 compared to $754,000 for the 6 months ended June 30, 2023. Gross margin remained consistent and 46% for the 6 months ended June 30, 2024 and the 6 months ended June 30, 2023. Non GAAP gross profit, which represent gross profit from sales of our products, not including revenue recognition from distribution agreements increased by 46% for the 6 months ended June 30, 2024 to $699,000 compared to $480,000 for the 6 months ended June 30, 2023. The non GAAP gross margin for the 6 months ended June 30, 2024 grew to 42% from 35% for the 6 months ended June 30, 2023. Reconciliation of these non GAAP figures are included in the earnings press release that we issued earlier today.

Speaker 4

Total operating expenses for the 6 months ended June 30, 2024 decreased to $7,680,000 compared to $8,800,000 for the 6 months ended June 30, 2023. The decrease is attributable mostly to a reduction in research and development and general and administrative expenses. Net loss narrowed during the 6 months ended June 30, 2024 to $6,700,000 or $0.14 per share compared to a net loss of $7,660,000 or $0.17 per share for the same period last year. As of June 30, 2024, the company had cash and cash equivalents of approximately $10,500,000 and as of July 31, 2024, the company had cash and cash equivalents of approximately $10,300,000 During the first half of twenty twenty four, we raised $5,035,000 in gross proceeds from the sales of ordinary shares under our ATM facility. The prudent management of cash has positioned us to execute major upcoming catalysts in the coming quarters, including the FDA advisory panel expected in Q4, 2024 and the FDA's subsequent marketing clearance decision anticipated in the EIA will be participating at TechSuite's Annual Best Ideas Growth Conference also being held in New York on September 12 to provide an overview of the IQ story and educate investors about the opportunities we are addressing with our novel process technology.

Speaker 4

Operator, we will now open the call for Q and

Operator

A. Thank

Speaker 5

Ronen, I was just wondering the pipeline, I know you have a sales force ready to go. If the advisory committee recommends that you get approval by the FDA in early 2025, can you just outline the planned rollout? Are you starting out with KOLs, physicians you're working with? And then how do you what's the commercialization plan beyond the KOLs in 2025?

Speaker 4

So thank you,

Speaker 2

assuming we receive FDA approval authorization, we have a very detailed plan, really kind of a strategy that we've developed for the next 5 years. And it's a combination of working with certain societies, KOL development, but also just key roles that we need to put into place here in the U. S. To support the growth that we expect.

Speaker 5

And then in Japan, I know you're working with Terumo. Can you talk about the plan there and the expectations there?

Speaker 4

Yes, Atarley. So we are expecting that Terumo will file the request for PMDA approval in early 2025, the Q1. Of course, some of it will be based also on the I3 trial data that they have with them. So we're working very closely with them, our regulatory team, with their regulatory team and with KOLs over there in Japan.

Speaker 5

Okay, great. Thanks so much. I'll hop back in the queue. Appreciate it.

Operator

The next question is from Kempe Dulliver of Brookline Capital Markets. Please go ahead.

Speaker 5

All right. Thank you.

Speaker 3

First, with regard to the first half, China was 0 in the first half. And I'm curious why if this is just a matter of their Shanghai Medtronic working through inventory or just other factors behind the performance year to date?

Speaker 4

So thank you, Cam. China is a little bit different than other territories and has its own complications. So and sometimes the sales are in 1 quarter, sometimes they are in different quarters. We can't really give any guidance regarding China, but we're optimistic and we believe that we'll be able to sell in China in the next quarters in the future.

Speaker 3

Okay. Thank you. The next question relates to the ICE secret data and your plans and ability to leverage that data in the U. S. In particular.

Speaker 4

So currently, CHAMP, we're focusing in the U. S. Mostly on breast and at least in the next year, this is what we're planning to focus on, but we're definitely utilizing this data for other territories in Europe, in Southeast Asia and also in South America. So it will definitely assist us.

Speaker 3

Okay, great. Thank you.

Operator

Thank you. The next question is from Ben Haynor of Lake Street. Please go ahead.

Speaker 6

Good day, gentlemen. Thanks for taking the questions. First off for me, just looking at some of these independent breast cancer studies, there

Speaker 2

were slightly

Speaker 6

different patient populations and that it seems like in several cases, patients that are less well off than the ICE3 cohort was. And I was just kind of curious if you guys have any commentary on that and what should investors take away from the potential for broader capability of GoSense?

Speaker 4

Hi, Ben. And again, thank for joining. So I think the most important thing is to understand that KOLs see the potential in our cryoablation activity and they choose their own set of group in order to do independent studies. We look at it as a very good thing from our side and we can see that the data is also very consistent and showing great promise. So we do encourage physicians to do their own studies.

Speaker 4

And of course, we can see all the papers and all the abstracts, which are which provides us with very important data for our next steps.

Speaker 6

Makes sense. That's helpful. And then maybe this is an unfair question, but I think you mentioned that in the press release there is something like 15 ongoing independent studies being performed out there. Are there any specifically that you highlight or investors to take a look at? And I know it might not be necessarily your domain

Speaker 2

and what I know I'm not on the call. But just curious if

Speaker 6

there are any that folks

Speaker 2

are really paying attention to or should be? So most of the

Speaker 4

studies are for breast, mostly breast cancer. If I remember correctly, about 8 of the 15 are breast cancer. And again, we are very optimistic regarding the studies and we're happy that so many KOLs are choosing our systems in order to do their independent studies. We can't really provide more data than this because again it's an independent study. We're not the sponsors.

Speaker 4

We do not decide when to submit a paper or when to submit an abstract to one of the conferences. But as soon as we have the data, as soon as we see it, we of course it to everyone and of

Speaker 2

course as soon as they

Speaker 4

themselves present it. Got it. Well, that's all I

Speaker 6

had. Congrats on the progress, gentlemen, and good luck at the advisory committee. Thank you. Thank you very much.

Operator

The next question much. The next question is from Yi Chen of H. C. Wainwright. Please go ahead.

Speaker 5

Thank you for taking my question. Would you be able to comment on whether the advisory committee will take place in kind of early Q4 or towards the end of the year? And do you know how many members will be in the adcom committee? And whether

Speaker 4

Okay. Thank you, Yi. Thank you for joining and thank you for the questions. I'll defer the question to Chad.

Speaker 2

Yes. And I'll have to have you repeat the second part of the question. But to answer your first part of the question, we expect to receive the date for the meeting shortly. And once we receive that notification, we'll issue a press release announcing the details. Also, the FDA will make the meeting available and we'll provide a webcast link for the event.

Speaker 2

And can you repeat the second part of the question?

Speaker 5

How many members will be in the ad con committee and whether they will only review materials submitted

Speaker 1

to the year?

Speaker 2

So we're expecting right now we don't know the exact number of we don't know exactly who the members will be on the committee yet, but we're expecting breast surgeons, breast radiologists, oncologists, also regulatory experts as well to participate in this event on behalf of the FDA. And a lot of the additional clinical data that's out there will be used to help support our efforts in that event.

Speaker 5

Okay. All right. Thank you.

Operator

There are no further questions at this time. I will now turn the call over to Ronen Zimmerman for his concluding statement. Please go ahead.

Speaker 4

So we want to thank everyone for participating on today's call. We have achieved our goals through the first half of twenty twenty four and for the remainder of 2024 and into early 2025, we expect more data from independent studies on breast cancer and other indication. As soon as we have the details on the date and the public link for the participation in the FDA advisory panel, we will share those with you through a press release. Thank you everyone for participating in our call today.

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Earnings Conference Call
Procter & Gamble Q2 2024
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