Stereotaxis Q1 2023 Earnings Call Transcript

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May 9, 2023

There are 8 speakers on the call.

Operator

Good morning. Thank you for joining us for Stereotaxis First Quarter 2023 Earnings Conference Call. Certain statements during the conference call and question and answer period to follow may relate to future events, expectations and as such constitute forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the company in the future to be materially different from the statements that the company's executives may make today. Call.

Operator

These risks are described in detail in our public filings with the Securities and Exchange Commission, including our latest periodic report on Form 10 ks or 10 Q. Call, we assume no duty to update these statements. At this time, all participants have been placed in a listen only mode. Call will be opened for questions and comments following the presentation. As a reminder, today's call is being recorded.

Operator

It is now my pleasure to turn the floor over to your host, are David Fischel, Chairman and CEO of Stereotaxis.

Speaker 1

Thank you, operator, and good morning, everyone. Call. Our last call 2 months ago included a fairly comprehensive overview of Stereotaxis and our strategy. We will keep today's call more brief, call are focusing on a few commercial and innovation updates. Revenue in the Q1 was essentially identical to last year's Q1, call barring the royalty payments that we no longer receive from Johnson.

Speaker 1

System revenue in the quarter reflects partial revenue recognition call are on the shipment of 1 Genesis system that is completing installation as we speak. During the Q1 and subsequent to our last earnings call, call, we received a purchase order for a Genesis system from a U. S. Hospital. We received another Genesis system order from Europe so far this quarter.

Speaker 1

Call, the combination of the partial system revenue recognition out of our backlog and the additional order into our backlog slightly increased quarter end system backlog to just over $15,000,000 Hospital construction has remained relatively slow, call weighing on the speed with which backlog converts into revenue and then into installed active robots. That said, we have a fairly busy schedule of installs

Speaker 2

call are planned over the coming

Speaker 1

months and continue to expect the majority of our backlog to be recognized as revenue this year. Call, since the launch of Genesis 3 years ago, we have now received orders for 22 robotic systems. Call, building a capital sales capability, process and infrastructure has taken time and required significant effort, call are expected to be recorded in the Q1 of 2019. These 22 orders over 3 years is a dramatic turnaround from the period prior to Genesis when only one system was ordered over the same timeframe. Call, call are not yet installed or launched and 8 remain in backlog waiting to be shipped.

Speaker 1

Our orders have been broad based geographically with include just over 50% of orders from the United States and approximately 25% each from Europe and Asia. Call are also evenly split between greenfield robots and upgrades with 11 of each. We are continuing to improve and refine our commercial capabilities and expect as we do so to see increasing orders of Genesis. Our capital pipeline looks healthy and is seeing growth across our are in the range of 3 focused regions. We have a few dozen, approximately 50 unique opportunities in our near term pipeline where we see a possible order over the next 12 months.

Speaker 1

Call, the order flow remains lumpy, the macro environment remains pressured, and we have still not fully benefited from a normalized placement cycle, given the engagement we see from the bottom up, there's increasing confidence in a consistent flow of orders. Call are most important to the adoption of robotics is the enthusiastically positive experience of the physicians who are using Genesis call, along with the reliability and clinical value Genesis robots are demonstrating in the field. Engaged and happy customers call are able to provide great care to their patients and build successful practices are the best ambassadors through which to ultimately increase awareness, call change historical misperceptions and grow adoption. We are pleased with the procedure utilization we are seeing on Genesis robots, call, which is meaningfully higher than our average global utilization. This is playing out both at accounts with upgrades that upgraded to Genesis call and with those that establish entirely new robotic practices.

Speaker 1

Last month, I had the opportunity to meet physicians from 2 of our most recent greenfield Genasys launches, call are the following questions. We are pleased to announce that we have happy and excited users. Call are grateful for our technology and are using it to treat patients in ways that meaningfully improve the quality of care and access to care. Call, discussions like those reinforce the positive impact of our technology and the relevance and importance of robotics for the field. Call are available on our overall experience with Genesis serving as the spark to restart capital adoption and to support utilization call is a reminder of the significant impact innovation has on commercial results.

Speaker 1

This segues well into a few are strategic value. Apart from the minority of our users who have been able to upgrade to Genesis, most existing robotic electrophysiologists call have remained limited to using essentially the same ecosystem of robot, catheter and mapping technology for over a decade. Call, Stereotaxis' proprietary robotically navigated ablation catheter, MAGIC, is set to positively address it. Call, since our last call, we have made significant progress on both the EU and U. S.

Speaker 1

Regulatory path for Magic. Call, in Europe, we have been awaiting receipt of the full spectrum of technical, clinical and microbiology questions from the EU regulator. Call, we have now received questions across all three of those categories and have fully responded to all the questions in what we believe to be a comprehensive and thoughtful manner call are in support of CE Mark. It would not be surprising to receive follow-up questions to our responses, call, we believe our previously communicated timeline is reasonable and still see receipt of CE Mark as most likely to occur late in Q2 or in the summertime. Call, in the U.

Speaker 1

S, submission of an IDE application to the FDA has been dependent on successfully completing a dozen preclinical studies. Call, as of our call 2 months ago, we had established a GLP level institutional animal care and use program and run a few pilot cases, call are not yet performed those on the record studies. We completed all the required studies since that call and will complete all the required follow-up periods within the next 2 weeks. Call, the results we have seen and physician feedback we received is very supportive of our confidence that the catheter performs well call will be enthusiastically adopted by the community of robotic users. Given this progress, we expect to make an ID submission to the FDA in the Q3.

Speaker 1

Call are other major innovation efforts, including a smaller self shielding robot that frees us from the extensive planning and construction currently necessary to adopt robotics a family of interventional guide wires and guide catheters call that expand the benefits of our robot into new endovascular indications, a digital surgery, hardware and software offering enabling broad operating room connectivity call and a full electrophysiology product ecosystem being built in collaboration with Micropor. There is a significant amount of work and progress being made on each of these in parallel. Call, as we provided much more color on each of these during our last call, I'll just reiterate that the timelines communicated on that call stand. Call, we have line of sight to reaching multiple significant regulatory and commercial milestones this year with growing commercial impact from each of these technologies next year. Call.

Speaker 1

As these technologies come to market, we will host focused innovation days to present these technologies in greater detail. Call are subject to the financial results. While the optics of Stereotaxis' financial results are unexciting, we see ourselves as being on the cusp of a strategic transformation. Call, we have clear line of sight to a future with strategic independence and attractive revenue model, broad robot accessibility and platform indication call, this core product ecosystem serves as a foundation for a high growth, high value medtech company pioneering Endovascular Robotics. Call.

Speaker 1

Kim will now provide some commentary on our financial results, and then I will make a few financial comments as well before opening the call to Q and A.

Speaker 3

Call. Thank you, David, and good morning, everyone. Revenue for the Q1 of 2023 totaled 6,500,000 call were down from $7,000,000 in the prior year Q1, primarily due to discontinued royalties from Johnson and Johnson. Call. System revenue of $1,800,000 reflects revenue recognition on the delivery of 1 Genesis System.

Speaker 3

Call. Recurring revenue for the quarter of $4,700,000 was predominantly impacted by the absence of the J and J royalty, call, along with the smaller impact caused by J and J catheter production shortages, which pressured procedure volume. Call are recorded. Gross margin for the Q1 of 2023 was 59% of revenue. Recurring revenue gross margin of 79% call remain similar with recent quarters with the loss of royalty impacting otherwise operational improvement.

Speaker 3

System gross margin of 7% continues to reflect call are significant allocation of overhead expenses over low manufacturing volumes. Operating expenses in the quarter of 9,500,000 call included $2,600,000 in non cash stock compensation expense. Excluding stock compensation expense, Adjusted operating expenses were $6,900,000 compared to the prior year adjusted operating expenses of 6,500,000 call reflect increased spending in R and D. Operating loss and net loss in the Q1 were $5,600,000 $5,300,000 call compared to $4,100,000 for both in the previous year. Adjusted operating loss and net loss for the Q1, call, excluding non cash stock compensation expense, were $3,000,000 $2,700,000 Negative free cash flow for the Q1 was $3,200,000 call at March 31, we had cash and investments of $26,800,000 I will now hand the call back to David.

Speaker 1

Call are available. Thank you, Kim. As detailed in today's press release, we are reiterating our expectation of double digit revenue growth for the year given our existing call system backlog and the view we have into our near term system pipeline and installation schedule. System orders are also call to increase in 2023 compared to 2022. Genesis System revenue remains the primary driver of overall revenue growth until we start to see more meaningful commercial contribution from our innovation strategy in 2024.

Speaker 1

Our core recurring revenue business remains relatively sticky and stable, call, we expect will be boosted significantly as we bring the Magic catheter and vascular interventional devices to market. Call. That said, procedures and disposable revenue in the Q1 were slightly pressured by catheter shortages J and J experienced call are due to supply chain and production challenges. These challenges have continued into April, but we are told by J and J that they will be addressed by the end of the quarter. Call may be recorded in the low 100 of 1,000 of dollars during the Q2.

Speaker 1

Situations like these further reinforce the call the strategic, operational and financial value of the Magic Catheter and having control over our own destiny. Call will be recorded. As we advance our innovation strategy to market, we maintain a balanced financial posture. We are investing in the organizational infrastructure and capabilities that will allow us to drive significant revenue growth from those innovations. At the same time, we remain financially prudent call to ensure that our existing balance sheet can comfortably fund all our innovation efforts and commercial launches without the need for additional financing.

Speaker 1

We look forward to now taking your questions. Operator, can you please open the lines for Q and A? Thank

Operator

you. We'll take our first question from Joshua Jennings with could be Cowen. Your line is now open.

Speaker 4

Hi, good morning. Thanks a lot for taking the questions. Call. Good morning. Thanks.

Speaker 4

I wanted to ask about just the replacement cycle channel. And are you seeing any cracks In terms of that opening up and what do you think needs to happen for that replacement cycle opportunity call will start to kick in more fully.

Speaker 1

Sure. So it's been interesting because when we started this with the launch of Jester around 3 years ago, we were always are talking about the typical traditional 10 year cycle by which capital equipment gets replaced and by capital equipment we mean mainly x rays are out there in the field. And I think in the past, I've mentioned that it's unclear how much of that extension of the life of X rays call is due to cyclical nature, just the macroeconomic environment and the financial pressures that call have been under versus a secular change due to perhaps the reduced use of X-ray overall and so the longer life that they can exist Before needing to be replaced, probably the truth is a mix of both. Either way, we have not seen that a contraction in that age where people are now are starting to replace x rays earlier. So it seems like the average age of an x-ray is definitely extending in most settings beyond 10 years.

Speaker 1

We are starting to see as some of these sites become very old, we are starting to see obviously much more of a contribution from the replacement cycle of the two orders that we just mentioned, 1 was a replacement order, 1 was a greenfield order. But I would expect are probably in the mid single digits, and so we probably still have a little bit of room to go to get to a more normalized level.

Speaker 4

Understood. Wanted to ask a question about potential just your drive for an open ecosystem within the EP world. And Are there any potential advancements with, say, in the Abbott for to integrate Eurobiotic Magnetic Navigation Technology into the InsightX Mapping platform or any other mapping system integrations that we should have on our radar for this year?

Speaker 1

Sure. So we won't obviously, we can't comment on any type of collaborative activities that we would be doing prior to them being announced, I'd say that we've talked obviously about the importance of open ecosystems call more generally for progress of the medical field and for patient care and for physician choice and then more specifically also for Stereotaxis in being able to pair the benefits of robotics broadly with a range of diagnostic and therapeutic technologies. And so that concept of an open EP ecosystem call is an important one. I think we've made quite a lot of progress on it over the last few years, and there's obviously more progress to be made. And so I'd say stay comes and we look forward to sharing updates as we're able to.

Speaker 4

Great. And just last question, sorry to sneak one more in, but This postcode ablation rates in terms of getting a commercial catheter in the United States is on call, the major cardiac ablation catheter players kind of teed up to get approvals over the coming 12, 18, 24 plus months. I guess, how would you have investors think about the role that robotic magnetic navigation system like the Genesis or mobile could play and could potentially enhance one of these larger players' platforms and help them win this race, call is PFA raise. Thanks for taking all the questions, David.

Speaker 1

Sure. So we obviously see what's going on in the field and overall We view actually robotics as particularly well suited to be paired with PFA. We've had some experience. We've discussed in the past as some of the preclinical studies that we've done with different PSA generators and some of the ongoing work that we are doing there and given the constant and consistent contact that a robotically navigated catheter has with the call, we've done the preclinical work and like I've mentioned, and we're trying to kind of advance things in a way where we can reach a first in man study And provide kind of more clarity on our clinical commercial timeline. And I'd say kind of Overall, I would look though when I step back and think about PFA and how it's entering the EP field, when you look at kind of call, all the cardiac ablation procedures more generally and really kind of PFA is right now being targeted at paroxysmal AF and there's some thoughts in calls of persistent AF.

Speaker 1

And we have vast We have a majority of our procedures and kind of in the ventricle and certain SVT style procedures where probably will take still 5 to 10 years to know the role of PFA in those settings under certain procedures where PFA will likely never be conference, particularly applicable or beneficial or safe, given kind of the type of arrhythmias that you would be dealing with in certain focal arrhythmias. Call and even in AF, as you have probably noticed, the original view of PFA being a Panacea has evolved into a more nuanced understanding of its role and its partial role in the field. And call. So I think again, we might not be the 1st mover in the PFA space, but I think we're doing all the right things on call on the backside to make sure that we have a nice offering there. And that's where again this Open EP ecosystem does provide a lot of value in allowing us compare the benefits of robotics with a range of other technologies that are being developed.

Speaker 4

Excellent. Appreciate it. Thanks, David.

Speaker 1

Call. Thank you.

Operator

Next, we'll go to Frank Tekinen with Lake Street. Your line is now open.

Speaker 5

Great. Thanks for taking the questions and good morning. I wanted to start with 1 on the construction timelines. You briefly commented call in the prepared remarks, but I was hoping you could take us a little bit deeper into how the construction timelines have been call are trending year to date and if there's any sign of those starting to be a little bit more predictable as we look at the back half of twenty twenty three.

Speaker 1

Hey, Frank. Good morning. So when I look now at kind of our guest history of these 22 orders received since we launched Genesis. And it seems kind of call almost kind of a there's a lot of variability around these averages, but almost kind of 1 year from an order till roughly, till most sites get kind of revenue recognized and installed and around 2 years until they go revenue recognized that they get shipped and then kind of around 2 years until they get kind of installed and are starting to do procedures. There's obviously wide variability around that.

Speaker 1

We've had orders that get shipped and installed and starting doing procedures within 6, 9 months, and we've had things where it takes 2 years and you still call recognize revenue by shipping the system. And so there's kind of a wide band around that, but that seems to be kind of what the average has ended up being. We are seeing more definitely more scheduled installations over the next, call, let's say, 9 months or the remainder of this year with a fairly busy schedule of things, some of those are things that have been backed up for long periods of time and other of those are from fairly recent orders where the sites seem to be on track call for meeting the timelines that they want to have for installation, we still see many anecdotes, many cases of call have a plan and that plan gets significantly delayed due to whatever construction issues or permitting issues they have. Call, I still am very much looking forward to the day where we do not have the complexity and the pain of the call, architectural and construction time lines, but at least we're seeing some movement kind of call seem to be that is real, real new for the next several months.

Speaker 5

Okay, that's helpful. And then for my second one, call may

Operator

be speak to some of

Speaker 5

the usage patterns you've noticed from the new Genesis installs over the last call are a couple of years and what I'm hoping you can touch on is maybe where are these physicians typically starting to use the technology with call and what's their usage patterns look like at different milestones, say 3 months, 6 months, 12 months. I'm just trying to get a better understanding of how the new Genesis users are ramping and how their usage is expanding within their patient populations.

Speaker 1

Call. Sure. So I don't have all the data in front of me to answer you in kind of in a comprehensive way with 3 months, 6 months, 12 months data. But I'll kind of let me think and kind of provide kind of a rough answer for that. And call, that's where the mechanistic benefits of our robots are particularly pronounced.

Speaker 1

And so about half of our volume is in ventricular tachycardia, premature ventricular contractions, congenital patients and those types of patients, and that's also a patient population, which is are generally underserved, under treated, many of them don't have an option for good therapy without the use are about robot and so that's where we provide particular clinical value. That said, there is benefits obviously across the spectrum of ablation procedures And so there are even procedures that might be considered typically as simple procedures call where we are being used because of the safety profile and the precision of robotics and the clinical benefits that provides. And so there is kind of a full spectrum. When I think about kind of our Genesis installed base, I generally would say that the types of procedures they perform follows that spectrum of our overall installed base. And so we definitely have a pronounced use In the complex cases and that is oftentimes the motivating driver for why, let's say, a greenfield account would adopt a robot, call, we do see usage across the spectrum of procedures, not just in the most complex ones, at least Across many of the sites, there are certain sites which might limit us only to the most more complex cases, but we definitely do see across installed base across the Genasys installed base and across greenfield Genasys installs mostly usage kind of across the spectrum.

Speaker 1

And call, does that kind of partially answer you?

Speaker 5

Yes. No, that's perfect. Appreciate the color and thanks for taking the questions.

Speaker 1

Thank you very much, Mike.

Operator

Next, we'll go to Alex Nowak with Craig Hallum Capital Group. Your line is now open.

Speaker 2

Okay, great. Good morning, everyone. Maybe just expand on the J and J royalty going away. Just remind us the dynamics around that and if the royalty didn't go away, what were going to be the consumable sales in this quarter just so we can figure out

Speaker 1

So We've had obviously a very long term relationship with Johnson and Johnson. Several years ago, that relationship was turned from an exclusive relationship into a nonexclusive relationship. And then there was the timeframe where it would remain a nonexclusive relationship And then where there would be a tail supply period, where still for several years J and J would have to continue supplying catheters to the market and that transition from the nonexclusive relationship to the tail supply period has started at the beginning of this year call and J and J stopped paying us royalties at that time. We missed out on something like about $500,000 in the quarter due to the lack of the royalties.

Speaker 2

Okay, that's helpful. And then how long does that tail supply agreement last till?

Speaker 1

Call are a 3 year period.

Speaker 2

It's 3 years. And then after the 3 years, there's basically no assumption that they will continue to supply catheters. Is that right? That will be a time frame you

Speaker 1

need to have Magic online by. There is no legal requirement, contractual requirement. Call, I think it's still open to interpretation of how things will play out there, but and open to kind of to seeing how things will play out. But if we do our job well, there shouldn't be any reason for them to continue supply.

Speaker 2

Okay, understood. And then any discussion with the FDA around the Gen 3 self shielded robot, just what needs to be done internally before submitting that 510? And What could influence the timelines? What could pull us forward? What could drag it out?

Speaker 1

So we have made an initial we've informed FDA that this is kind of coming. So there's some awareness there as though we've not kind of submitted any documentation in a material way. And there is a lot of very recent experience call with FDA on a robotic magnetic navigation system. We received Genesis FDA approval just 3 years ago, call and so we went and that was a fairly extensive process. For those of you that were on the calls at the time, call, you may remember we had some catch up 510 that had to be done.

Speaker 1

So there were multiple steps in the process of that approval call, given the long period that Stereotaxis had not been in regular dialogue with FDA. And since that time, we have been in relative dialogue, I think kind of we keep them up to date on our progress. And so overall, I think we have a fairly clear call are not necessarily the same. We are not seeing any further progress on the regulatory expectations evolve also over time. So let's say, call, we're aware of the fact that there's generally more of a focus on things like human factors testing and on cybersecurity.

Speaker 1

And we know that those are things that perhaps we want to do to at least document in a more extensive fashion versus previously. But overall, I think we feel very comfortable about the regulatory path and what needs to be done on our side, and we have the very recent experience, which guides our path.

Speaker 2

Excellent. Thanks for the update. Appreciate it.

Speaker 1

Thank you. Next,

Operator

we'll go to Neil Chatterjee with B. Riley. Your line is open.

Speaker 6

Hey, guys. Good morning. Thanks for taking the questions. Maybe just on the sales funnel, just curious how Things are shaping up with the current capital spending environment and kind of ongoing hospital headwinds. It sounded like you still kind of see a pipeline of about 50.

Speaker 6

So just kind of curious to get an update there.

Speaker 1

Yes. So when we look at kind of the pipeline, I've kind of mentioned in the past that we have a call are more organized way to now review the pipeline and its status in each region, And there's approximately 2 dozen, a little over 2 dozen in the U. S, about a dozen in Europe and about a dozen in Asia that have kind of accumulated on this pipeline where call, the sites are talking about potentially getting an order over the next year. And what I've seen generally is that There's obviously a subset of those that will get delayed, but kind of that's how our pipeline looks at this point. And I kind of so I pair, I guess, this bottom up relative kind of healthy call, a growing pipeline, I think as our team matures, as kind of their efforts in the field mature, as the general market plays, I think, sees our overall progress as a company.

Speaker 1

That helps. And so I see that kind of bottom up pipeline as it's growing. I pair that with kind of the top down assessment that it still remains a relatively pressured environment. Call, the macro environment is not is what I've called in the past, that's still a headwind environment, not a tailwind environment. I think with the balance of those 2, we're able to do kind of some progress obviously, call and we feel confident in the guidance that we've given this year.

Speaker 1

And so I guess kind of that's the balanced viewpoint given this bottom and top down call are data.

Speaker 6

Got it. Thanks for that. And then just maybe on China and Micropore, call, the ecosystem there that's being developed, didn't sound like any huge updates on there versus last quarter or last call, just curious how things are tracking there? You obviously had Genesis submitted for approval and the broader platform being developed, so just curious on an update.

Speaker 1

Sure. So yes, so MicroPorts submitted Genasys call at the end of last year and over the last couple of months has been submitting some supplemental information to the regulator there, to that MPA, and they were and has been also working on its submission for the catheter, it has to wait until we get the e mark for MAGIC before it can submit MAGIC, given the pathway that we want to go through, but it's also working on the submission for its own variant of a magnetically driven ablation catheter. And from a mapping and integration perspective, we've already done very well. And so that's something that won't be a long pole in the tent at all. And so as we look at kind of all of that and what MicroPort feels is a reasonable timeline given its discussions with NMPA, will come earlier, but I'd say that kind of that feels like the right timeline overall.

Speaker 1

And really, it is that ecosystem of Robot capsid or mapping that should come together well in order to allow for the full launch and taking advantage of the full commercial team.

Speaker 6

Got it. Maybe just one last quick one. I don't know if I missed it, but just any update on just how you're tracking for the mobile RMN Clearance in Europe in the second half?

Speaker 1

Yes. So we've referred to you talked about kind of in the Q3. And so I'd say We are working feverishly on multiple fronts there to be ready for kind of an approval at that point call will be end of Q3. Great.

Speaker 6

Thanks. That's it for me.

Speaker 1

Thank you. Okay.

Operator

Call. Next, we'll go to Adam Maynard with Piper Sandler. Your line is now open.

Speaker 7

Hi, David. Hi, Ken. Thank you for taking the questions. 2 from me. The first one is on the Magic RF catheter.

Speaker 7

And I think I heard timelines for Europe still call. Can you talk just a little bit about kind of commercial strategy there call, will you look to bolster or add sales reps prior to launching that? Just maybe flush out the commercial strategy a little bit. And then I had a follow-up. Thanks.

Speaker 1

Sure. Hi, Adam. Good morning. So yes, so the time line, obviously, it still remains somewhat of a black box. Call, you respond to questions and you kind of sit and wait, but everything is now kind of back on their court.

Speaker 1

We are very pleased that we got at least The first set of questions from them across all three categories and that we were able to respond in a timely fashion. And When we look at kind of the commercial and so assuming we get approval at some point this summer, The overall commercial strategy is we have invested somewhat in our team in Europe. Call. So we have kind of 2 people more than what we have had historically, and that was done in anticipation conference call of kind of Magic coming to market and the opportunity that would present itself. And we are we have call, kind of done fairly detailed reviews of every one of our 30 some hospitals in Europe that have a robot and in each one understanding both logistics of bringing the catheter call.

Speaker 1

Market, is there a tender? Is there not? What hospital application needs to be filled in? Call just on the logistics side, on the financial side, what should pricing look like on the

Speaker 4

comes to adoption, which I think we have

Speaker 1

a fair we have a good clarity. The team there has worked kind of now for a fairly long time. They've had to work on these business plans and we have a fairly good plan site by site what we want to do. We have designated a few sites, A handful of sites as those that will participate in a limited market release phase. Call, while the catheter has kind of shown itself to be robust and working well conference call across kind of many of the many studies now.

Speaker 1

And we there is a type of also art call to cardiac ablation procedures. And so you do want good physicians who are interested in being the pioneers, who are interested in doing the early procedures to have a first shot at things, to learn some of the tips and tricks that can only really be learned in that setting and then to be available to share their experience call and help also train others. And so I would think about an LMR period of probably kind of call several weeks, a few number of months, a couple of months perhaps, and we're really focused on those sites and making sure that they use the catheter across a range of cases and can kind of document call and refine best practices, at which point then we would move into a full launch across all the 30 accounts in Europe. And so I think about it as a relatively with that kind of limited market release period post that being a relatively quick adoption across our installed base. I've talked in the past that there are certain countries in Europe where you do have tenders call are other kind of administrative hurdles, which don't allow you to fully kind of convert an account and just based off call are commercial agreements and just based on kind of the physicians' desire.

Speaker 1

So there are some of those places that countries like France, some of the Scandinavian ones call where you do have kind of other logistical barriers, which will just take kind of that over the course of probably a year or so, you can overcome the vast majority of those, but there are some of those that will slow adoption at certain accounts as we work through them. Call are being recorded.

Speaker 7

Okay, great. Very helpful color, David. Thank you for that. And for the follow-up, just I wanted to ask about HRS, which is scheduled for later this month. And I saw in the press release call, something about the potential to share meaningful updates on the innovation strategy at that conference.

Speaker 7

I was hoping you could Just expand on that a little bit. What do you have planned, either from a clinician standpoint or Wall Street perspective? Just any more details on call would be great. Thanks for taking the questions.

Speaker 1

Thanks, Adam. Stay tuned. Call, we at this point won't share much more, but as kind of it's appropriate and as we're able to share more, call, we look forward to sharing some news at HRS that we think will be impactful for the EP community and also impactful call obviously for the company and for the investor base. And so we look forward to sharing it there. Call and more generally at HRS, and we're excited for our showing there.

Speaker 1

There is a special session, a joint session of the call, Society for Cardiac Robotic Navigation and HRS at the conference. And so that will be a nice session in which robotics call is obviously kind of front and center. And again, apologies, I can't share much more at this point, but we look forward to sharing news call in less than 2 weeks.

Speaker 7

Okay, perfect. We'll stay tuned there. Thank you.

Speaker 1

Thanks, Adam.

Operator

There are no further questions at this time. I'll now turn the call back over to David Fischel, Chairman and CEO of Stereotaxis for any additional or closing remarks.

Speaker 1

Call. Okay. Thank you very much for all your questions. We look forward to sharing the updates at the Heart Rhythm Society meeting next week call and working hard on your behalf in the coming months and we'll speak again in a quarter. Thank you.

Operator

Call. This concludes today's conference call. You may now disconnect.

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