Q4 2020 ICAD Inc Earnings Call
Greetings and welcome to Ikat incorporated fourth quarter and full year 'twenty 'twenty earnings call. At this time, all participants are in a listen only mode.
On answer session will follow the formal presentation, if anyone should require operator assistance during the conference. Please press star zero on your telephone keypad. Please note. This conference is being recorded I would now turn the call over to your host Jeremy Feffer, you may begin.
Thank you Stacy and good afternoon, everyone. Thank you for participating on today's call.
Joining me for my Cat for Michael Klein, Chairman, and Chief Executive Officer, Stacey Stevens, President and Scott <unk> Chief Financial Officer.
Earlier this afternoon, I cut announced financial results for the three and 12 months ended December 31 2020.
Before we begin I would like to caution that comments made during this conference call by management contain forward looking statements involve risks and uncertainties regarding the operations and future results of <unk>.
I would also note that management may refer to certain non-GAAP financial measures.
<unk> believes that these measures provide meaningful information for investors and reflects the way that they view the operating performance for the company you.
You can find a reconciliation of our GAAP to non-GAAP measures at the end of this earnings release.
I encourage you to review the company's filings with the Securities and Exchange Commission, including without limitation forms 10-Q, and 10-K, which identify specific risk factors that may cause actual results or events to differ materially from those described in the forward looking statements. Furthermore, the content of this conference call contains time sensitive information that is accurate only as of the date of.
This live broadcast February 24th 2021, I cant undertakes no obligation to revise or update any statements to reflect events or circumstances. After the date of this conference call with that said, it's my pleasure to turn over turn the call over to Michael Klein Mike.
Thank you Jeremy and good afternoon, everyone I'd like to begin by highlighting a few financial highlights with a particular focus on high cash topline revenue momentum.
I can't it's fourth quarter total revenue of $10 5 million represents a 47% sequential growth over third quarter. We are pleased to report that revenue revenue growth as our flagship high margin profound AI offering grew by 70% over our third quarter revenues to further punctuate that.
Performance of profound AI in the U S. On most profitable market total sales of AI and services collectively grew on a sequential quarterly basis on an even greater amount, 72% from Q3 to Q4. It is also noteworthy that this substantial quarterly growth also represents a 21%.
Increase in detection product revenue over the fourth quarter of 2019, which was the prior high watermark for profound AI sales.
In our detection business, we recently achieved a critical milestone on the installation of our 1000th profound AI system since our product launch in early 2019, we believe it is particularly noteworthy that nearly 40% of these 1000 installs have been installed during the course of this pandemic.
We see ourselves currently an enhanced position to offer a steady flow of new AI offerings product offerings that we anticipate bringing to market with an accelerating cadence I cash newest offering profound AI for risk assessment is a product that looks into the future and provides us unique and personalized profit.
Ability score for potential future breast cancers profound risk assessment can find cancers that are not visible or discernible today, yeah may still exist in a sub visual range, our cutting edge AI risk algorithm could see these cancers two years before they enter a physician's visual appeal and in doing so.
Provides a unique future risk score for patients examination in the future.
With our new risk products. This would be in addition, which would be in addition to a score for breast cancer. Today. We result, we wind up with two products two scores versus once a day one for the future and what exact that examines risks today I'm sorry that sandwich.
<unk> today.
We now have a total of 70 502 day in three D installations, we see this along with our unique ability to integrate with all of Mammographic systems workstations, and pets provide us as a significant barrier to entry.
As I've said in the past they are over 1800 different combinations of technologies. When all put together that we've had to solve over many years to be able to apply our solutions into the market. In addition in the area of risk assessment. We believe that we are years ahead of foreseeable competition our risk assessments.
Software it took eight years of intense effort and literally hundreds of thousands of images is for.
Launch into the U S and O U S breast cancer screening market could not have occurred at a more opportune moment, we are now well positioned with a novel product offering optimally suited for a pandemic, where it can assist with scheduling and prioritizing patient screening for breast cancer.
Now moving in parallel with the growth of our AI offerings. We also experienced significant quarterly growth in our therapy business, which soft new product sales and installations in Q4, 2020, zoster, new equipment revenues and the installation of new systems X sites are lead indicators for follow on recurring revenue sales.
Post install SaaS tied to procedure volume represents the majority of Azores quarterly sales volume recurring disposable sales for X Ray source Youtube usage volume also have a significantly better profit margin profile than the initial equipment sales, we deploy a classic razor razorblade.
Model.
As a total business I can't achieve the above mentioned sequential revenue growth of 47% Q3 Q4 over Q3 I can't also grew 11% over Q4 2020 simultaneous with this we decreased our operating expenses in Q4 by 3%.
From prior year Q4, thus, we have realized both leverage and a surge in productivity, while our development teams have achieved growth.
On the products and release of products at an accelerated pace sales growth combined with cost controls and the bulk productivity gains allowed us to reduce I catched pre tax losses to $1 5 million in Q4, 16% lower than Q for Q3 losses and 50%.
Lower than Q4 2019, we also ended the year with cash and cash equivalents of $27 2 million. These numbers are the result of a very deliberate effort and planned trajectory to achieve positive cash flow and EBITDA in our core detection and therapy businesses. It is also.
Worth, noting that we are achieving our goal and I would like to refer to as frictionless procurement. This is a dynamic where sites can access I can't technology.
For a choice of either an OEM mammographic system their local distributor, mostly O U S. Two packs providers or through our own direct sales force. In addition, we have also introduced what I'll refer to as frictionless pricing. This will increasingly characterized our go to market approach as customers are now.
<unk> to purchased via one upfront licenses with recurring annual service fees or two monthly subscription pricing or three purchasing on a SaaS basis, which is fundamentally a payments for each patient analyzed.
We are excited about the continuing emergence of subscription and SaaS pricing, though still in the nascent yet growing stage of adoption profound AI system secured through these vehicles will increasingly generate recurring and predictable revenues revenues that will move our already high margin products. So on.
Even more attractive level, we anticipate that overtime predictable recurring revenues will also mitigate seasonal fluctuations and screening for sea as screening procedures flow more evenly than health care procurement cycles.
As we reflect on 2020, we effectively lost a full quarter of selling even when customer doors were open we experienced distracted clinical and administrative decision, making it took almost four and a half months till mid summer before sites return to full screening with 100% of sites.
Active screening has sustained throughout the fall and winter months and now well into 2021 as you may recall Q3 detection AI product sales grew 44% over Q2 and as stated above Q for detection product sales grew sequentially 70 per se.
Over Q3 with this is an overview of our recent performance and sales momentum. Let me provide some brief commentary about our new risk assessment offering I catch new profound AI risk offering us now is there for for the large two D mammography Mark as we've said on earlier calls in many parts of the world.
On the two D market is larger than the <unk> market in the coming months, our risk offering will be available for Ford for three D mammography systems as well.
This means that we will shortly have not one but two breakthrough novel first mover AI offerings for both two D and three D. Mammography, both will be offered in the us and O U S and both will be sold through all channels and utilize the aforementioned range of pricing vehicles through the use of frictionless customer.
Purchasing we are increasingly using the best demonstrated practices, leading software companies practices that have successfully been pioneered to achieve dramatic growth and value creation with that let me highlight two large deals we closed in Q4, so all of us mammography and wake radiology or a five year deal.
So with Solas represents the single largest deal in I can't history. It includes both profound AI for detection and profound AI for risk assessment and it covers 160 mammography systems sold US operates in more than 80 branded centers in 11 states as well as seven offices in the D C.
Capital the Sydney further Solus has stated its intention to triple its installations and market size and reach over the course of this agreement.
<unk> is uniquely skilled debt raising patient awareness of their unique mammographic capabilities. This approach of tracks and increases patient flow in their 80 served markets, we see disagreement accelerating the adoption of profound AI, but other screening centers adopting within these 80 catchment areas.
It is our belief that a deal of this magnitude with a clear industry leader validates our cash broad based clinical utility workflow capability and economic value proposition. The fact that solus was a flagship site for Hologic <unk> mammography system now vastly expands <unk> footprint as a provider.
<unk> of AI for all mammography vendors and health care systems now our agreement with wake Radiology, North Carolina is the largest provider of three D. Mammographic services in North Carolina and it covers 22 systems in many new and important markets is another example of the cascading impact.
<unk>, a profound in essential markets and key catchment areas and where we see the adoption at one notable site influencing or prompting the sale and adoption in other sites or at other sites in multiple markets.
To use a profound.
Detection AI provides us with a significant differentiator against market competitors.
Delighted for found AI in their own self generated media campaign in press release launched about a month ago. This is yet another hologic mammography side and further expands our well balanced sales reach across all available mammography systems. Finally, I'd like to review, some developments and intraoperative radiation therapy or I O R. T.
Related to the treatment of Glioblastoma us on a recurrent basis also referred to as GBM as we've discussed at our well attended innovation day in the fourth quarter and in our last earnings call. The updated data on Glioblastoma showed continued and in fact, rather dramatic improvement compared to the <unk>.
Charles.
In the end point areas of overall cancer survival as well as progression free survival time dramatic results were seen our new study is now enrolling and designed to further validate these outcomes. After a seizure sites in both the U S and in Europe.
Dr. Santosh case for a nationally prominent neuro oncologist at the John Wayne Cancer Center will serve as the principal investigator of our trial and in the trials also IOR tea will be used to treat current gbm's following surgical excision of the malignancy it will be compared to the current radiation therapy.
Standard of care and the trial is now underway and sites are now recruiting for patients. The trial design and details can be found at clinical trials Gov.
The primary outcome of this 80 to 100 patient trial will be an assessment of overall patient survival secondary endpoints would be to assess the pattern of disease progression and potential adverse events and quality of life. This is not an overly long or expenses trial since most sites already have access to <unk>.
FDA cleared technology, we anticipate the first patient treatments in the weeks ahead. We also anticipate that preliminary data will be submitted for presentation by the end of this year 2021, Saar therapy can be delivered real time at the same time as the surgery and offers an important advantage, especially during COVID-19.
Other forms of radiation therapy, typically require the need to wait for to five weeks post surgery before commencing treatment lop off us real time on demand treatment for a disease that typically growth as rapidly as one per cent per day, our technology, obviously unique clinical advantage and the channel impact.
Disease progression that typically moves quickly and do so at a significant and earlier stage. So in summary, we are now we now see ourselves operating with high momentum and a vastly improve clinical and economic environment. In spite of COVID-19, and perhaps in some ways because of it we are making significant progress and.
Making important leaps forward throughout our business, both our detection and therapy segments are on a clear and palpable inflection point with continued growth rates anticipated. We have an increasingly strong balance sheet and continue and we will continue our steady march towards positive EBITDA and cash flow and with that I'd like to turn the call over to Carlos.
Two our Chief Financial Officer, Dr Arrow collateral Scott.
Good afternoon, everyone and thank you Mike on.
I'll now summarize our financial results for the fourth quarter ended December 31 2020.
As I have mentioned previously we believe it is useful to compare our sequential revenue from the prior quarter. In addition to our year over year comparisons.
Fourth quarter 2020, total revenues were $10 5 million, representing a sequential increase of $3 4 million or 47% as compared to $7 1 million in the third quarter of 2020.
Detection revenues were $8 1 million in the fourth quarter of 2020, an increase of 53% driven by a 70% increase in detection product revenue.
Looking at our Q4 revenue on a year over year basis.
Total revenues for the fourth quarter of 2020 increased $1 1 million or 11% with detection revenues increased from $1 3 million or 18%.
Moving on to gross profit.
On a percentage basis gross profit was 71 per cent for the fourth quarter of 2020 compared to 76 per cent for the fourth quarter of 2019.
On a pure dollar basis gross profit for the fourth quarter of 2020 was $7 5 million as compared to $7 2 million in the fourth quarter of 2019.
Total operating expenses for the fourth quarter of 2020 were $8 9 million, a point $2 million or 3% decrease from $9 1 million in the fourth quarter of 2019 importantly.
Our expense management resulted in a net loss of $1 6 million or seven cents per share as compared to a Q4 19 loss of $3 4 million or <unk> 17 per share.
We remain committed to managing expenses, while strategically investing in our ongoing initiatives to drive growth.
Moving on to profit metrics GAAP net loss for the fourth quarter of 2020 reflected an improvement of $1 8 million to a loss of $1 5 million or <unk> <unk> per diluted share compared with a GAAP net loss of $3 3 million or 17 cents per diluted share for the fourth quarter of 2019.
Non-GAAP adjusted EBITDA for the fourth quarter of 2020 was a loss of $9 million, which represented an improvement of <unk> 5 million compared to the fourth quarter 2019, non-GAAP adjusted EBITDA loss of one point for me.
Non-GAAP adjusted net loss for the fourth quarter of 2020 was $1 4 million or six cents per diluted share as compared to a non-GAAP adjusted net loss of $1 9 million or 10 cents per diluted share for the fourth quarter of 2019.
Moving on to the balance sheet as of December 31, 2020, the company had cash and cash equivalents of $27 2 million compared to cash and equivalents of $22 6 million at September 32020.
During the fourth quarter of 2020, the company received $6 1 million in net proceeds from the sale of common stock to select institutional investors.
In addition, as of December 31st the company achieved the revenue milestone as set forth in the Western Alliance on agreement and as a result, we have deferred repayment of the note from September to March 2022.
This concludes the financial highlights of our presentation and I would now like to turn the call over to Stacy.
Casey.
Thank you Scott and good afternoon, everyone. Although COVID-19 continues to impact many companies in Q4, including US we continue to be encouraged by the overall performance of our company. Despite unforeseen challenges brought on by the pandemic in 2020 I can continue to advance our innovative solutions.
A rapidly evolving marketplace, we believe our dedication to providing precise powerful health care for patients that are expertly engineered to optimize operational efficiency clinician confidence on patient outcomes will continue to enhance our competitive position on both segments of our business.
The COVID-19 pandemic introduced practice changing challenges on many facets of health care, including cancer detection and treatment. There has never been a greater need for our cancer detection and therapy suddenly sense.
The World Health organization recently announced that breast cancer has overtaken lung cancer is the number one diagnose cancer globally. This is compounded by the fact that medical care, which severely disrupted many areas at the height of the pandemic, resulting in an enormous backlog of mammograms, which is now estimated to be as high as a percentage.
$10 million as a result of decreased cancer screening last year.
Given these circumstances, we firmly believe that our technologies offer a unique value proposition that is exceptionally timely and positioned the company and our technologies for success book ahead in 2021 and beyond.
Let's begin by highlighting the success of our company for latest advancement profound AI right.
This for some time technology uniquely combines age breast density and settle mammographic patterns, including those that may not be apparent to the human eye to yield a highly accurate and personalized to your risk assessment.
We're excited about the benefit for the software I can offer to both clinicians on most importantly patient and we are continuing to drive forward several key initiatives relative to expanding our clinical validation on a global basis, including developing Kols research sites on clinical centers of excellence with multi ethnic multi.
Geographic data diversity, all aimed at driving adoption globally on ensuring product efficacy across a diverse range of pace that.
We are working to finalize the risk algorithm for three D. Breast tomo synthesis. This process requires a collection of three D cases for both training and validation we have made significant progress in collecting the cases needed for each of the D. B T systems to be supported and the preliminary performance results with the three D images.
Very promising.
Profound AI risk will be particularly well positioned for success in the years ahead US mammography begins to transition from what is an age based screening paradigm to day to a risk adjusted singing paradigm. This technology offers a practical felicia that empowers physicians to offer more personalized screening truly India.
Digital life for each one that we believe this technology may ultimately lead to supplemental screening being applied to a smaller correctly targeted percentage of women and for lowering total cost per patient spend overtime.
And in the body of clinical evidence supporting our technologies for high impact clinical studies remains an important focus area for us profound AI rescues already supported by a recent study published in radiology and in Q4, we continued efforts to initiate a multicenter European initiative to conduct it below.
<unk> retrospective analysis of TD risk, we are continuing to work with a number of highly influential thought leaders from Italy, France, Spain, and Germany tourists refine the steady credit par and it's for multi geographic day that diversity.
We have previously stated our U S retrospective analysis study of rescue D and three D. Well also be led by Dr. Emily Conant Professor of radiology at the hospital of the University of Pennsylvania.
Data also reflects an ethnically diverse group of women with a special focus on genetically predisposed to women at high risk such as younger African American women. We are currently identifying additional sites for inclusion of other ethnic groups, including South East Asian American and women of Hispanic origin. It is our hope for.
This research will contribute to the growing body of evidence supporting our technology and potentially pave the way towards smart personalized screening recommendations in national clinical guideline organizations, such as National Cancer Institute and the National comprehensive cancer Network High impact clinical studies also habits.
Potential to feed health care economics and per relations studies, which could validate economic benefits for the model improved savings to the health system.
In summary, we continue to see tremendous interest for risk in the market and remain very positive about the impact on innovative resolution will have on our business moving forward I look for to providing further updates on per pound risks in the coming months.
In addition to our focus on profound risk we are continuing to advance profound AI for DVT I've flagship breast cancer detection algorithm in late 2020, we finalized the development of the third generation relief, which demonstrates improved clinical performance, especially related to specificity are false cause.
<unk> of the algorithm versus the current commercial product. The new version was submitted to the FDA and our notified body in Europe for CE, Mark and it's currently under review by both bodies, and we anticipate receiving clearance to market and sell in the us and Europe in the coming weeks.
The new profound AI release will also be accompanied by an updated platform release, which will further reduce the time it takes to process images as well as introduce the profound AI index card, which will provide our customers with a simplified summary of all I can result in a single view.
Italy, there are at least for offer enhancements to how Oh I integrate for parts and mammography workstations to further improve reading workflow and efficiency for our customers.
And now I'd like to review our strong overall performance internationally, our total ex U S revenues of $2 8 million for full year 2020 represented a 20% increase over full year 2019, and a year significantly impacted by COVID-19, we are extremely pleased with these results. Let me review some recent inner.
National Achievement during Q4, we sold our first profound AI system into Israel and shipped two evaluation system to the largest medical group in that country, where 70% of Israelis are treated for the first time, we participated in the Israeli radiology Congress with our own Kols speakers provide.
That's the opportunity to introduce our suite of products to this large target market.
France continues to be a key market for us we completed our first installation in the south of France, which generated extensive TV radio and print coverage as well as an installation at one of Frances that's known hospitals in Paris lot PK Salpetriere.
In addition, we signed an exclusive commercial contract with a leading private clinic group our sales channel investments in 2019, and 2020 are generating results and we expect continued growth in this geography from 2021.
Now, let's quickly switch gears and discuss arthroscopy business, which has demonstrated important progress in multiple areas during a period of uncertainty due to COVID-19.
As stated on our last earnings call. We have brought in new senior leadership and Jeff for it and the business has seen some significant changes from an operational and strategic standpoint, we have implemented a two tiered strategy to drive revenue is around the current applications, while developing the new indications narrow and erectile through.
Our clinical trial registry pale off sites and pre commercial effort, which we will talk a lot more about in a future innovation day.
In Q4, there were seven systems sold worldwide, including our first neuro commercial site in Germany to South hospital, which will be using the system for multiple applications.
The skin business once a week started in Q4 do you see some favorable reimbursement changes and we received an order for several system.
These purchases for Kols users.
For him up on multiple Chromatology sites in both the western and South Eastern U S areas.
On the O us business and cleaning China, we have seen consistency with controller placements and sourcing usage, we have two milestone wins in China in Q4, including Union Hospital in Beijing, one of the most influential hospitals in China, and they will be trading multiple applications.
Moving on to the new clinical applications. The protocol for treating recurrent GBM has been approved and now resides on the clinical trials Dot Gov website as Mike mentioned this is a milestone and its vital as we finalize the first treatment sites and gained IRB approval from individual hospitals.
For you we are focused effort and hospitals identified to join our trial and begin treating GBM patients. Some of these sites are current users and others are completely new health care systems that we are targeting we expect to be treated in GBM patients from two to three sites in the second quarter.
So in summary, we are excited about the progress and accomplishments, we have driven across both sides of our business and we look forward to providing you with further updates as we continue to advance our business for it in 'twenty and 'twenty, one drive sustained leadership and create additional shareholder value now.
Now we will open the call for questions operator.
Thank you at this time, we will be conducting a question and answer session. If you would like to ask a question. Please press star one on your telephone keypad, a confirmation tone will indicate your line is in the question queue. You May Press Star two if you would like to remove your question from the queue for participants using speaker equipment. It may be that.
Necessary to pick up your handset before pressing the star keys.
Our first question comes from Kai on Nixon with Cantor Fitzgerald. Please go ahead.
Hi, guys. Thanks for taking my questions Congrats on a great quarter here.
I wanted to talk about the sequential detached from business growth. It was obviously stronger than it was in <unk> and that was kind of want to break it down to a couple of categories. So first of all which of the sales channels was the most successful during the fourth quarter, and then secondly, where a number of those installs on detection delay from previous quarters on.
Finally, what were the main types of customers that bought the software. Thank you.
So Kyle how are you doing Scott.
For most of the.
Both in the revenue was from the direct our direct channel versus OEM growth and it was primarily around three D and risk.
Okay, but was there anything pushed out from previous quarters or.
Anything like that because it was obviously a really impressive number.
So.
We had a big enterprise sales, we referred to on a couple of times you know those things take a while to develop.
So it's hard for us.
Okay.
It happened in the fourth quarter.
Okay got it thanks, Scott for Us and just want to also touch on the entrance of the new competitive product in the fourth quarter Israel on that would spend a few months, but just wanted to get an update there. So obviously, it's only going to affect customers with a certain type of camera, but just was curious if there was any changes on the competitive landscape and how that kind of <unk>.
That said the way your go to market or the customer response to new products and then of course, how did risk kind of play into that and us.
Yeah.
Have your strategy there.
Mike you want us.
Microstation I'll speak to that.
Yes, sure I'm not sure if one wants to make their yeah.
Uh huh.
Does that make.
Okay, we might have lost him yeah. So yeah, the new competitor in the space that you're referring to we really feel.
A lot of confidence in our ability to win deals and those accounts and we have a lot of evidence so far given that the large accounts that we have a mandate. Even in Q4 that were you know that that had that imaging equipment. Yeah. We we really have stronger clinical claims on the team.
Okay.
Claims from a sensitivity to specificity to reading time on.
These types of things.
Look at those altogether, our clinical claims are far superior.
Well.
Mike.
Yeah. Thanks can you hear me I think Mike Yeah. We can we can we can okay and then I'll kick off on I can tell you the standpoint, Kyle we feel very good about our ability to compete on the clinical performance elements and then I would say remember we're on a third generation of our product right. So as new.
For coming into the market or coming in with them. You know products that are on the first generation not only are we already on the third generation, which we expect to commodity FDA and in a matter of weeks it will have on.
Further improve clinical performance. We also are now increasingly including a risk as part of all of these deals and there's tremendous interest in risk and in fact, it's actually driving the customers' choice of profound AI in many cases, so the combination of superior superior clinical claims and are having.
Risks that nobody else has a short term risk algorithm at this point I think puts us in a very strong position competitively.
Okay.
Yeah, I don't know if on largely I'd say like us somehow by yeah. On my line was a code there for a moment, but I think those points are well established but I would just add that.
This is one of the.
Benefits are.
Just unanticipated consequences of Covid, it's very hard for launch into a market, especially for us.
For new players out of the market and I think we were we thought we were going to have that dynamic at some point this year, but.
The competitive dynamics, we anticipated seeing both from international and domestically, we just not seen emerge. We we can tell us to only see in the U S. A R. <unk> system solution for detection, that's certainly on the on.
On the risk side.
So that's the that sort of puts us at.
On what do we call the extra mile where we think there are a few runners so.
Yeah.
Thanks for the color thanks, Scott for that debt debt.
Definitely answers the question.
Just a couple of questions. So on that I've been thinking about the change obviously recently with the optimum acquisition.
It's our view that change is imaging business doesn't really fit into alternate sites main business areas and honestly on the United can be better off divesting the business. So I just wanted to ask kind of like that would be affected us.
If that were to happen in other words, if the imaging business was kind of separated from change would you be better off for worse off with one of the other pacs vendors kind of added the change assets and had that larger scale.
We're sort of agnostic on this guidance on that.
The the business will change as we have great expectations for that business as it continues to gain traction.
If they merge with another taxpayer that would be fine as well I mean, we're already working with.
The majority of them and I will say if there if they continue with the current constellation there that they're in.
With us.
As part of United We think that debt is actually very exciting because it provides data to a carrier and insurance carrier that can actually be used to make her positive determinations about the economics for care and sometimes it gets us in the door that were longing to get into and they will have data from from their own Oh.
From their own forces in terms of the efficacy of care the whereas.
Whereas disease was found on at what stage disease discounts. So we kind of like where it is now and we're fine if it happens to.
Attract itself for a tax itself to another packs for enterprise solutions either way, it's I feel like it's a it's a win win.
Got it thanks, Mike and just one last question hopefully it'll be quick.
So you actually mentioned repeatedly recently that both sides of the business should grow up really strong rates going forward over the next two years.
Last week or at least recently you mentioned I think 50% growth. So I know you're not providing long term guidance for can we maybe see that in 2021 or possibly.
Possibly in 'twenty two I'm, just trying to think about the roadmap in the near term as you kind of.
Drive motor success in <unk>.
Both segments.
Yes, we do see significant growth in and in fact collectively on on both sides of the business. The you may have heard me talk about this frictionless procurement, which means multiple channels. It can be purchased through as well as.
Frictionless purchasing which allows us to be acquired either as a.
From purchase with recurring revenue service.
Subscription or SaaS and because of that is going to be some undulations in terms of which channel as it comes in some of these channels actually Mike just as an example take a million dollar sale instead of getting it upfront with some service it might come in at 400000. This year for 1000 index and continue to give us for that.
So because of that we've been a little bit.
We've been a we felt a little bit premature to provide for a firm guidance because we our goal is to be able to meet the market where it is but in some ways. We know that if we take a million dollars off the board and do it in a SaaS model, it's going to help margins. It's gonna help recurring revenue would be predictable, but it could have some.
<unk> on the on this year's revenue.
For the extent that of course, there is no doubt that any deal. We take today will not only have an impact this year, but we'll have an even bigger impact for the year in the years to come so back to your point, we do think that the growth can accelerate in outer years. If he takes subscription deals were SaaS deals today.
Yeah.
Thank you. Our next question comes from Frank Talkative with Lake Street Capital markets. Please go ahead.
Yeah.
Hey, congrats on a good quarter and thanks for taking my questions Hi, Frank couple here on a couple here on sold us to start off obviously this is a giant win with it being a very very clear indicator of it being the most superior technology on the market, giving us a whole logic accounts. So I wanted to ask a couple more questions here and see if we can get some more color.
First can you give us any color on to the expected rollout ramp into solar locations to any color on whether or not these will be upfront purchases or subscriptions and then three as you spoke to tripling I believe you said tripling the installed base over the next five years whether.
On a profound would be almost a standard option.
<unk> rollout these new installs.
Yeah, so for us.
It's a perpetual license sales so.
We delivered a significant portion of the <unk>.
System, two sold us in 2019 and 2020.
And then the.
The rollout of the installation of that into sold this will happen on their timeline in 2021. So it's.
It's a five year agreement for a major we recognize a significant amount of revenue in 2020, and then the remainder will generally come in Ratably.
Over the remaining for years, just tied to the service and.
And some installation.
And then as they grow and as they add more profound locations.
More locations they would add profound into those locations and we would get additional incremental revenue when they add them.
Does that help.
Yes, absolutely.
Hum.
Well for that if I if.
If I can just add to that one piece on the going forward.
The reason there's a particular reason this was may five restructure is a five year agreement, which is also consistent with your point about tripling.
And they do indeed see per pound, both detection and and risk is a clear differentiator. So it is integral to the growth equation in markets as they are as they move forward in fact.
There there are some anticipated additions to the solas.
Universe that we expect to hear in Q2 and later this year and we believe will be will be part of those of those deals as per the agreement.
Yeah.
Got it helpful on the sole it's sorry on the profound Gen. Three that you spoke to Stacy is there potentially a commercialization strategy change as you're going to you're already installed users with gen. Three something along the lines of we're going to continuously rollout new.
Maybe there is an interest in converting over to a subscription model, where you can be a part of these updates without having to purchase new every year or am I overthinking, a little bit here.
No I mean, it's a great question and we already have customers today that or buying service plans that enable them access to you know all of the generations on software after that second launched in any given year. So we have some experience doing this.
So I don't think it's going to change our commercial model at all.
Are seeing at this point some customers who are expressing an interest from moving from a capital model to a SaaS type model or a subscription type model I, usually that's customers that may not have budget from 'twenty 'twenty, one and may not be getting budget until next year, but really urgently want too.
To acquire the technology. This year right. So I think we'll see a mix of models.
We're prepared to offer the customer the ability to purchase at any way they want whether it's a perpetual license or a subscription based model or you know a monthly fee of financing we have the ability to offer all of those different ways and that's what makes that are referred to as a.
Frictionless sales model and we can adapt to the customer's need from a budgeting standpoint, and we are seeing customers want to accelerate the acquisition of the technology, regardless of whether they have the budget today. So that's a dynamic that you.
You know that has caused us to be able to offer that flexibility for customers.
Yeah.
Thank you. Our next question comes from per Ostlund with Craig Hallum. Please go ahead.
Okay.
Thanks, Good afternoon everybody.
I wanted to come back to us.
On the notion of genius AI since it was introduced in cleared kind of around our SG&A there.
Given that your two big announcements commercially.
Commercially for the quarter were.
Sizable hologic sites.
Is it a reasonable conclusion to think that.
In a way Corelogic FDA clearance for sort of represents a bit of a a bit of a dam breaking if you will maybe the market was a little held hostage wow.
Well sites were sort of waiting to see what whole logic actually had and that now that it's sort of out there and would seem to be clearly inferior that sort of a drip.
Driven folks here direction.
Yes per this.
Very good question.
The there is no doubt.
Pretty typical for large market players to want to quote unquote free as the market, let's say.
We've got a solution, we're coming out with.
And we got to look at the solution ourselves in side by sides with other for some of these deals debt matured in the fourth quarter and two.
To get into too much granularity I would say, there's three things that sites need to see in a and.
On an AI solution. One is that you wanted to have you want to make sure. The detection is high you want to make sure. It doesn't come at the expense of false positives and you wanted to make sure. It comes that all of this happens without the expenses increasing reading time.
And we use the calculation, which is called AUC area under the curve, it's basically the miles per gallon for for AI and in the release, which is published you can't hide these things the FDA publishes them on the FDA side on whole logic sites the area under the curve, which is sort of a byproduct of sensitivity and false positive for Ya catchwords.
What do you call, but you shouldn't have.
We have a number that's double that of the competitive offering of our largest offering that further to the point is that you want to make sure one of the reasons for using that's one of the reasons people bought three day was that reduce false positives. So you don't want a product that actually increase as false positives, especially during the <unk>.
Pandemic the data on the whole are deciding together typically like to speak this way about competitors, but it's just on the site actually increases false positives and the third piece, which is probably one of the more challenging elements is that why you've gone from for images for three to 400, you wanted software that's a workflow productivity.
Debt reduces the amount of time, and we do that to the effect on 53% and almost 58 per cent for complex images and in the case of <unk>.
And for logic actually result, an increased.
Amount of time and that's all on the side. So I think you're correct people set a weighted took a look at that.
And then.
It's basically come back to us and we say here's the product and it's not only where it is today, but it's going to get it moved to this third generation in the weeks ahead and it has risk and I think given those dynamics.
It's created a very favorable set of circumstances for us.
Sure, Okay that makes sense.
Since our since GBM hasn't been brought up in the Q&A I think I'd.
I'd like to do that.
Far be it for me to.
Fast forward beyond the trial that you're you're just embarking upon now, but what let's let's stipulate that the.
The data that the trial that you have being led by Dr. K sorry.
More or less matches that of.
For the Caribbean shaft and.
Data out of Russia.
You've talked about potentially partnering with another player in this space potentially act as a bit of a selling arm for for you for I O. R. T is that is that still something that's on your radar or is it something is it something you would consider.
Sort of a bifurcated.
<unk> net for where you do some.
Direct through your existing channels and.
And partner with somebody else, how how could that look.
Well, it's it is interesting parents a really good question, how do we optimize the value of soft which sees us falling into a couple of buckets. One you just mentioned us off neuro. There's also is off we might say women's health.
Nocturne with Stacy Dermatology and then there was off in each of these areas its pretty clear to us that adding our own sales forces on each of these areas since they're all unique markets, maybe not optimized for technology and that this technology.
Given the pricing of the X Ray sources and the technologies on the reimbursement in these areas can allow for distribution partners that even if they took 2025% 30% revenue would still provide very very favorable returns from this business, perhaps even greater than the returns today because the re <unk>.
<unk> profile is hot so when you look at neuro clearly.
It makes sense well initially we'll have perhaps two or three reps that'll be working to seed the market. Because this product is for sale right now, but we're not positioning ourselves as competitive for any player, but we see ourselves as additive for jumped us and that sets up a framework for us to be able to partner with other players out there who may have 30 to 50 people out there.
And maybe on excellent debt to diffuse the technology and still provide very very handsome gross margin returns and by the way, we think that could be the case for not only neuro, but for other areas as well for us.
So many as you can see that we have sort of a hybrid we nursed the products along and then were to breakout opportunity, we might add some dedicated capability or rather some partner capability to diffuse it into appropriate channels and do more to technology.
Thank you next question did that day.
Yes.
But Dave <unk> with JMP Securities. Please go ahead.
Great, Thanks, and congrats Mike or.
And maybe even Scott if we look at debt.
$6 6 million detection product revenue.
And I don't think you broke out sort of the you.
You know the two D risks from the profound AI is but I'd love to get any color there that you might be able to give us.
And maybe on the.
Two D versions, even if it could be sort of a geographic split.
I know you mentioned the three ways, you're going to price. This I assume in this quarter, but most of it was licensing like the profound in the past would would that be a safe assumption and any color you could give us would be would be great.
Well, let me give us sort of macro picture and I'll, let Scott colored in with some with some numbers Peter.
Keep in mind that we launched it first in international.
And we train the distributors and we didn't launch it until.
September then we itself for any for for our reps and distributors in October. So we only had a couple of months, but it was a very meaningful couple of months and then in the US. We also launched it in a soft launch towards the middle of the fourth quarter and this was designed because our plan with risk is to also.
We've learned from from detection to try to get it out for the major sites that are going to publish the data and if we then have a hard launch with the data published in all these.
Luminary key opinion leader sites already out there it will strengthen the launch just a stronger lunch, although with may be preceded by a softer for us having said that the product was that unexpected outcomes for us in terms of it aligning very well with reimbursement dynamics outside the us and it actually was a key swing factor on some of the deals.
So Scott do you want to comment a little bit on.
Some of the elements in the mix with risks that we saw on the fourth quarter.
Yeah. So look it was primarily license sales as we've been selling historically here.
And at risk was a big part of the offering.
For our boat sold us and for a week. So we got some significant revenue on them you know, we're not breaking it out but just say that you know, it's an embedded piece of the overall sale and it was certainly a big value driver in and getting both of those sites.
Got it and I guess you mentioned the license.
It's a.
Or price point I guess my follow up question would be.
If you sold some profound AI to some of these accounts now and obviously through 'twenty 'twenty.
Ho Hum.
You know can.
Can we think about.
Adding.
Maybe risk to some of your already profound accounts and maybe putting some sort of a I don't know $30000 for whatever the license.
S P might be.
Looking ahead, even on some of the places that you've already put profound this year.
What do you think the propensity to upgrade isn't would it be a feel like that.
Yes.
I would say David that debt.
Certainly when you've got now north of a thousand installs into a market in the US that's you know in the <unk>.
High teens and worldwide could be on $35 million to $40 million and we have as I said 16th average to these sites on a thousand profound side, but first place you're going to go into your own sites for both Judy and.
<unk>, what I would say however is that in.
We're being intentionally vague on this point are by design about switching over to a model where at some point this year.
Closer to mid year, we're going to move from a licensing model for risk to a to a subscription only model and there's a reason for that and that is that this is an offering that's going to rapidly evolve.
New ways and rather than have to offer.
Offering you know six months 12 months with genomics with new risk factors, we wanted to get people, we're seeding the market and key accounts and act.
It's almost like the for people that put money down on their test right. So with key accounts moving the market along and then what we're hearing not to start a marvellous that sites are going to want to buy on a subscription basis, because the product is going to be such that it'll be smarter tomorrow than it is today.
We are indeed going to go after the low hanging fruit or existing accounts with certainly going after novel accounts gives us a big differentiator you saw that in Q4 with these deals.
And we do anticipate it moving towards a.
A model, where it would be on a subscription or a percentage basis, and obviously, we're going to work with folks that sort of present. These models. How do you see them laying out it's one of our obligations to help folks on vest until new models.
So we will give proper introduction as we start moving in that direction, but by design, we are being a little bit.
A little bit.
And on the quieter side between that cutover will happen.
No I appreciate that I mean, it's going to have a massive impact positive impact on.
You keep your P&L so.
Yeah, I think we're all excited about that I think lastly, you did get asked something about sort of sustainability or.
Given I know the first quarter, usually is a step down from fourth but.
On the momentum that you saw in <unk>.
Quarter that still had some impact.
I don't know US we look at next year and earn a destitute list for this year now.
In vaccines and everything kind of kicking in in some of those eight to 10 million backlogs coming through.
I mean.
And then they don't want to give guidance on just I'm trying to wrap my head I didn't have you're doing a $10 million quarter until fourth quarter of 'twenty. One so I mean, a bit of a quandary as debt.
How this is going to play out, but it would certainly seem that there could be.
Upside or said.
Said differently that you can sustain this momentum even maybe even in some of the earlier part for 'twenty one.
I would say you know what I mean.
There's no doubt this market is in a buying mood and adoption and our approach is to make it.
Frictionless.
So.
So as these sites progressing in for example, we're dealing today with.
Just call it well.
Well get into the account, but as an example, we're dealing with it account that could be a million dollar deal, but it could come in as for Lithia Allison. This year next year and for three years thereafter, right. So well it could be an amazing deal. It can also take a million dollars out of that of.
This year or this quarter put it into 400000 and spread out over the year, but yet you know we're gonna love that we did this deal and they don't have high remarks, so that makes it a little bit tricky.
But the important thing as you know our mantra is if people want to buy the product anyway anyhow anywhere they want to pay for it any channel we're gonna be there because we do feel like we have a not only first mover, but it kind of at the moment almost the sole mover advantage certainly that's the case with risk weighted to keep moving quickly.
You made the point that the.
This is one of the reasons, we like the subscription model is that there are episodes during the year when people do their buying just like people buy cars at the end of the year or the end of the month.
SaaS model allows us the smoothed that out over the course of procedures, but there is this hard coded pattern of when people buy and it typically is the end of the year on they typically kind of sticks to get ready in the early parts of the year. So that pad on we hope to smoothed out over time.
Got it thank you for that.
Next question comes from Yale Jen with Laidlaw <unk> Company. Please go ahead.
Good afternoon, and thanks for taking the questions as well my congrats on the very great quarters.
Happen Thanks Jill.
Yeah.
My first question is that given that you have two major accounts signed in the fourth quarter, you've been there on a fully.
Not all the sites on purchasing but is that do you.
Consider that a little bit lumpy type of events.
Events that make us a jump on the revenue and that should we think about you should think about that way for forecasting going forward or business and really a starting point for already.
Baseline moving forward.
Theres, a clear tilt debt a lot of this hit in Q4, but but not on it and.
And in fact, as Scott will say on the first things get chipped our hardware and so on software and that often can suppress the gross margins as they have been seen in the fourth quarter and then their sales that kind of still out over the next quarter or two and then of course, all service revenues hit 12 months or 12 months and well let's.
Let's say the first day of on 13, where the service revenue is kicking it should be noted that these sales outside of service agreements on them.
I think that there's going to be a certain degree of lumpiness and that when combined with a certain amount of.
Certain amount of seasonality in their procurement cycle and and.
And some of that is.
It leads us to the conclusion that.
That we want to move quickly and we're gonna take on sites that want to buy us even if it means that we have to take them in creative ways, such as fast ways because on the long run that's a great opportunity.
So we're still going to have a little bit of this lumpiness in the seasonality for for this year and it's going to get mitigated over time.
But it's clearly good news on the other big deals in the pipeline that are triggered by these other day, but it is important to note that all of these super tanker deals that the selling cycle, which is typically not only 90 to 120 days at most but for these larger sites theyre more of their close at a four to six months just so many more.
People that have to be involved so those deals tend to push out a little bit in <unk>.
Take a little bit longer.
Okay, Okay, I've been able to help here.
No. That's very helpful. And then maybe follow up a little bit on debt.
Debt both for this early in the week.
At least on the fourth quarter debt.
The sites actually make the purchase among others.
Under their management is that a very small portion of that I know, it's a five year deal for us solely but.
How should we think about at least on this particular oh.
Oh vendor.
I'd say in general you should take us out for.
For sources current accounts, you should think of it as mostly almost all of us deals.
Where were captured.
In the fourth quarter to some extent in other words not every piece of revenue, but the supermajority of revenue in Q4, and certainly the hardware and software and a big deal and a good amount of the software.
Wake has more momentum.
It's not all of their sites will be up and running and that'll be something that will flow over the next six months.
You may have noticed that even when we did deals a year and a half ago with Simon net we announced the big million dollar deal that took three quarters for that to be fully implemented in the case of sell as much on that has already been captured in the fourth quarter with a certain amount that will roll through as stated in Q1 Q2 and also noticed that.
And we've not included net service revenues, which are significant that won't kick in on.
Until 12 months after installed.
Thank you our next question.
It comes from Jean Manheimer with Dougherty and company. Please go ahead.
Thanks, Good afternoon, and congrats on the strong finish to 2020.
You know on week, a nice agreement there I just wanted to clarify they committed to buying the risk product at this point although.
So when it comes to generally available or is that going to be a separate sales. Thanks.
I'm going to turn this on over to Stacey because she brought US deal. It was Scott because he knows all the details guys.
Hello. This is actually a team effort on the part of our sales team and many people on the company.
But to answer your question gene they are trialing, our risk product and making a decision on how much they would like to deploy that throughout their site. So this is a little bit of a set of past purchase path trial.
Scenario here and we got the first part of the purchase and now we have some products on trial and then they'll make a decision on acquiring the rest of the affiliation, but where we're very hopeful that they will see the value and risk.
Okay excellent thanks for that color.
Scott Your your Opex was down 3% in the quarter as he called out I'm. Just curious if that's representative of the go forward cost structure or.
No.
Do you expect expenses to tick up as travel and hiring kind of kick into gear. This year. Thank you yeah. Yeah. It looks you know clearly with a bigger revenue quarter Theres onetime expenses in the quarter. So I would say from <unk>.
Q4, Opex wouldn't be your opening run rate for 2021 for sure.
And as far as travel on the rest of Us stop gene.
We'll see how it goes you know obviously, there's not a lot of people traveling yet.
And we'll just we'll build those expenses in us as we start as it starts to unfold.
Yeah.
Okay.
Thank you Scott I'm, just going to add one piece of that team. It's been really really interesting I think all of US. We've always felt that we have to show up and do that because it was the norm right at the show up you have to when I say show up I mean, you got to be there to finalize deals on all of that certainly my 19th century Havlik supports that but we've been amazed on how much we can get done there.
Because of the enormous change.
Just fire all these zoom in on teams et cetera.
I would say that in this year.
We've looked at it and say that most of the conferences. This year are still going to be pushed out that we've converted to far more cost effective ways of using online tools.
<unk> <unk> three $400000 to attend the travel meals and all that stuff, we've been able to get the same kind of facetime through.
Through our internet tools on Webinars for things such as that so we'd be thinking carefully before we add back those those full expenses and the other thing I would just add to that is that in terms of productivity.
Yes.
One quick anecdote I said to one of our software engineers.
The whole software team set a very productively on I said, yeah. So you've got incredibly productive did like two years of work and like half a year for nine months and he being.
Thoroughbred sell for claims interpret said, Mike I'd been waiting my entire life for this moment.
Where it can just code code code and I have to go to business trade shows et cetera. So I think we're going to get the dual for.
Activity increase and cost savings for this year and I think we're going to have to figure out what the right blend will be going forward. For example, should we we're gonna be taking a look at downsizing facility sizes.
Travel all these things we're going to have a new reality of work and it's going to be more customers yeah.
Yeah, and I think Fortunately for us.
Stacy his team had the marketing team had the vision to be out in front of us before the pandemic hit. So we were really able to capitalize on that and and get through 2020 with some of the investments we had already made.
Okay very good thank you for that.
And last thing from me.
On the G. P M side, how far are you along in recruiting those 80 to 100 patients I'm just curious how difficult. It is to maybe identify the patients that are.
Best suited for this trial. Thank you.
Well the good thing is we have eight sites right and and each site will probably probably see five or six patients that are candidates.
And.
None of these 80 patients right and we think we can and where we expect to actually treated our first patients.
And at least two likely three of those sites for the next 30 to 45 days.
So once we get going on.
<unk> slowed things down a little bit, but not much because after all.
Single fraction radiation therapy, it's great appeal during Covid, you don't you're not going to get six to eight weeks duration of therapy. So we're recruiting will have three sites up to three sites actively.
Actively treating we believe.
Let's say late March April and then we'll have all sites.
In Q2.
I can't exactly say, how long it will take us to get to 80, but its not a big number if we can get all sites treating we could be.
It could be 12 months to 18 months and that's pretty useful because you know.
A lot of the survival time for patients can be measured during that time and one of the reasons, we say youll see inflammation towards the end of the year is that even if we have a dozen patient spend by mid year, well tracking at six months and by that point, we will have been beyond the control groups recurrence rates and we'll be able to see some meaningful data even the latter part of this year.
So we're super excited about this not really expensive trial.
And that they already have the equipment and its just the loan it's really what we're paying for us the imaging.
And people can also use a commercially so we hope to get some commercial sales since it is an FDA cleared product and we can't they can't use it commercially and get reimbursement. If we're also giving them the balloons.
Not very costly.
For the energy So I think we're going to see a lot of development since off this coming year, particularly as we get towards mid year on GBM.
Great. Thank you I appreciate it.
Next question, Andrew the silver with B Riley Securities. Please go ahead.
Hey, Thanks for taking my questions and sorry, I was hopping between calls so just let me know if you have answered any of these but.
I really wanted to delve a little bit deeper into the solas win.
Is it just fair to say that the overwhelming majority of the revenue.
Related to that contract was already recognized in the fourth quarter.
And if so could you kind of let us know how much of the fourth quarter year over year growth in detection would you say would be attributable to debt.
Well that's on the first part I would tell you that.
Cigna.
A very significant part of that hit us his.
His queued for.
And Scott you can give the breakdown of this.
21% because you heard the comment Andrew about 21 per cent a year over year Q for product sales.
Thats, what you are looking for us the subset of that that would show us right or how much sales representative that.
Yes.
Yeah, we're not I'm not going to break it out specifically here handy.
But it's a significant portion of the year over year growth.
Right.
But remember so just and us.
Just to put some color behind US right, we had a pretty significant Q4 kind of one time Q4 deal last year as well I know you weren't here.
So it is.
Fourth quarter is certainly at the time when we get.
On both years comparatively we've had some big deals, but this one was a bigger percentage of the quarter than it was last year.
Okay that gives us good context on kind of thinking about how to millennium sequentially and year over year. Let me, let me just stay on one thing Andrew.
And that is that if you look if you Google So let's touch on I'd say, you'll see that they did an acquisition even in Q1. After the steel 17 systems right. So we don't have the exact closure date of that and then maybe a lag between that and and when orders are placed but that's an example of this.
This is an account that's 160 sites that want to go to 60 cameras that wants to go to 500 and wants to go from 80 locations for 250 and get there with us so.
There is this deal and then there will be and there is for <unk>.
Revenues that may follow.
As Scott said the majority of it is going to be in Q4, but some of it will hit us.
In the early part of this year on a more modest amount, but then there's the service revenue and then there is again.
Adding to the soulless mammography universe, which is a very aggressive private equity backed company.
No that's very useful context, thank you and us.
Just given so it is historic.
The equipment base.
And how about.
Kind of ties into the competitive landscape for Hologic.
Now that genius AI has released their data and you have a very notable win subsequent to that can you maybe talk about the sales and pipeline traction on what the cadence looks like subsequent to that have you have you seen a material.
Change.
Change in any sort of a at.
At least inbounds or just conversations that are starting or decision, making process and any color. There I think it would be very valuable given the.
The the equipment market dynamics that exist out there right now.
Whenever you're on a sales process and somebody says look I wanted to I wanted I.
I'm obligated to check out with.
My mammography dangerous, bringing it to market they feel a sense of having to do that.
In some ways the fact once the.
It's almost like a.
Yeah.
And it's something like the misery of uncertainty is worse than the certainty of Missouri well on this case, we have surgery and no certainty here allows our our situation to be actively compared so to answer your question is helping us and it's helping us.
And it does take away the obstacle.
<unk>.
Something and it turns into a known something that was unknown.
And that combined with any other competitive threats that we may have seen from abroad. That's put us in a situation that two years and we still have not seen a competitive system in the market and we don't for Cc. One for you now.
For the near future that could obviously change but it is this is one of the things about AI is that your results are published it's there for everybody to say, it's black and white.
So there's just there's no selling around that.
And that's all we ask for us and educate our whole approach here is educating customers.
And we sell through education and that we've done from day, one and as long as we're on that path I think we'll wind up in a strong position and to answer. Your question. This scenario does does in fact play to our advantage.
Okay.
Okay.
Highlighted as the cadence of the business has has materially.
Improved us as far as it relates to profound.
For foundry I traction subsequent to what happened in December.
I mean, if I were to highlight that as like a point that that makes sense.
It is fair to say that are for sale was taken 90 to 120 days and there was another clear they were considering they may have added another one or two months for that sales process, but if they look at the data and say, okay I've seen it or if they look at other flagship sites. I mean this is what's so emblematic about this you know some.
Some of these sites are converting that sort of like okay, I get it I've been watching them. So people watch other vendors, but they also see where the where the big movers. The big change has gone so as Simon Ned.
Is right behind Solus in size and with the and of course, Solus and then big groups like.
What we've seen in and wake and with MD Anderson, which was another big site, which we had at that point, we couldn't really talk a lot about when you start getting these supertanker sites converting.
It starts giving people an indication on where sort of the alpha product is.
Yeah.
Okay.
Very useful. Thank you again last couple of questions for me just can be related kid the glioblastoma opportunity.
So obviously youre doing a much more substantive trial right now, but you had earlier data that was very very favorable.
Can you talk about.
What your sales and marketing initiatives are at the early data stage, considering you can actually still sell the product as a DRG out there that seems to be.
Favorable when you utilizing your systems.
And then I would just be kind of curious if things related to the eight P. M.
Benefit or impact.
How that's perceived in the market right now.
Yeah.
Well, let me go in reverse order on the ATM side.
Cereal.
He knows very well.
On the Atms don't really affect breast cancer. They also affect earlier as radiation therapy. So if youre going from let's say $20000.
<unk>.
On reimbursement for external beam radiation therapy for for brain and now you're getting reduced from 20000 down for 12000, you are going to try to find a way to shorten the radiation therapy cycle for two to three weeks, which we expect will happen in all areas of their existing therapy, which by the way because we call it the <unk>.
Gideon model, because that's how they typically treat the hypo fractionated and they do that in Europe. The fact that you can deliver a significant portion of the dose if not all the dose during during surgery allows for a model where people can actually actually reduce external beam radiation therapy.
And do so in two weeks and the fact that were covered under DRG means that you can get the radiation oncology codes. After DRG, so that definitely benefits. This.
Oh I didn't know that last part that that's useful.
Okay and on just last thing.
As I think about the Glioblastoma opportunity.
Does your end market can be just overwhelmingly.
All right on the marine neurosurgeons or.
Some portion of that should we still think about it is it like a traditional <unk>.
I'm calling for market.
I think it's going to be it's going to be neurosurgeons, who are going to have to Paul it's gonna be book Neurosurgery I look at the neuro oncologists as for like the air traffic controller, He's gonna pull everybody together, it's going to be the medical oncologist stuff as well.
The neurosurgeon, that's going to do the cutting and radiation oncologists.
They treat radiation therapy, the radiation oncologists are super interested in this because the standard we're comparing to what's called <unk> 12 on five which is a six to eight week radiation therapy regimen. They use avastin to prevent a radio necrosis and basically what this study is designed to do using the people who are the <unk>.
Study lead us for that radiation therapy protocols that are in the study if can we be can we beat the established protocol in radiation therapy, which is patients with 13 14 months, if you treat with the with Sterling raising therapy and they go for five months between radiation between progress.
These are rough numbers. So this is where and so that is the control arm of our study. So the evaluation on them is can we be established protocols. So the radiation therapy community is very very excited to be able to say if this can be that control. This doesn't mean it replaces radiation therapy.
Nor did it replace him as overnight.
Or are on the opportune helmet from Novocure, but it may make them better revenue where that helmet for 20 hours a day may only need the word five hours a day you might get better results for Tim as I'll remind you make it better results mainly from therapy in a shorter period of time. So that's what we're looking for.
Very excited about and it's all because we're trading at denaturing, producing double strand DNA breaks real time at the time of surgery, you actually produce in immuno response, and we're doing it for six weeks and if you wait for six weeks after surgery and you're growing 1% a day, you're already trying to feedback disease.
That's regrown over the course of time.
Okay.
Thank you I would like to turn a floor over to Michael for closing comments.
Yeah.
Well I want to thank everybody for hanging in there with us and I'll quickly summarize and thank everybody for joining us and for those who have hung in there full time, which I believe is the largest and with people.
Is that are pledged share on full year 2020 earnings and again to summarize the highlights amount on card business and I'll just reiterate a couple of key points. One is the sales momentum, we're seeing driven by profound with significant growth in Q4 and on top of significant growth from Q3.
Significant near term commercial opportunity with the launch of profound AI risk.
That's a giant leap forward and gives us two shots on goal and a cash.
In a growing market of not only <unk>, but <unk> sites.
Technology, that's been validated with major deals that saw us mammography and wake radiology and finally, a very very significant opportunity in the high value indication of Glioblastoma with an FDA cleared product that can be used real time exhaust our tea and is one that's actually start treating.
Treating patients as we speak and can be found on clinical trials. So.
So we look forward to providing you with further updates on our progress on the coming months and we want to thank you for your continued interest in <unk> CAD and please enjoy the rest of the day and please stay safe.
This concludes today's conference you may disconnect your lines at this time and thank you for your participation.