Q1 2023 HeartBeam Inc Earnings Call
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Greetings and welcome to the Heartbeat first quarter 2023 financial results conference call.
At this time all participants are in a listen only mode. A question and answer session will follow the formal presentation. As a reminder, this conference is being recorded.
Before we begin the formal presentation I would like to remind everyone that statements made on the call and webcast may include predictions estimates or other information that might be considered forward looking.
While these forward looking statements represent our current judgment on what the future holds they are subject to risks and uncertainties that could cause actual results to differ materially you were cautioned not to place undue reliance on these forward looking statements, which reflect our opinions only as of the date of this presentation.
Please keep in mind that we are not obligating ourselves to revise or publicly release the results of any revision to these forward looking statements in light of new information or future events.
Throughout today's discussion we will attempt to present some important factors relating to our business that may affect our predictions you should also review our most recent Form 10-K and Form 10-Q for a more complete discussion of these factors and other risks, particularly under the heading risk.
Factors eight.
A press release detailing these results crossed the wires. This afternoon at four <unk> P. M. Eastern time and is available in the Investor Relations section of our company's website Hearts beam Dot com.
Your host today.
Renaissance Bowditch, Chief Executive Officer and founder.
Rob you know president.
And Rick Brownstein, Chief Financial Officer will present results of operations for the first quarter ended March 31st 40 23.
If you require operator assistance. Please press Star then zero.
At this time I will turn the call over to Heartbeat, Chief Executive Officer.
Brenda love, but itch.
Thank you operator, and good afternoon, everyone.
Pleased to welcome you to today's first quarter 2023 financial results Conference call.
Today's call, we will be speaking with you about some very important updates concerning to our recent fund raising efforts and adjustments to our strategic goals.
Recently, we completed a $25 million.
Secondary offering.
And a $1 5 million registered direct offering.
This $26 five maybe.
Real enable us to execute on upcoming product development clinical and regulatory milestones.
And extends our cash runway into late 2024.
With the addition of this funding.
We took the opportunity to adjust our strategic focus to enable timely delivery.
Ambulatory factor anecdote cardiogram for BCG drawbacks, our key future value drivers.
Going forward, our immediate focus is on a daily and FDA five 10-K.
Clearance for the Heartbeat NGO credit card sized BCG device, followed by a second FDA clearance on the system's ability to synthesize broadly Alex is that deals ever ECG.
Rob we'll focus on the topic and discuss in more detail, our strategic focus and product timelines in a moment.
Recently, we announced the acquisition of substantially all assets from LIBOR <unk> Health solution company.
LIBOR cable plus a few detection system.
Well first FDA cleared description of the Apple.
Our continuous cardiac safety monitoring.
This acquisition extends our reach in remote monitoring and detection.
I mean, who ownership.
EBITDA clearance product.
On may 13th.
Of this year, we closed a secondary offering of 45 million.
Followed by our registered direct offering of one 5 million $1 for a total of $26 5 billion.
Most of the public's benches, the offering was oversubscribed from the initial 15 million on EPS.
Even though the $25 million level, we did not meet.
The demand.
I believe this speaks to the quality of our company.
Public venture communities.
Understanding.
Our future.
So who is public ventures.
One on subsidiary of F&B Capital Holdings.
And Publix ventures.
<unk> proven to be a tremendous strategic part to hobby Opex ventures is a member driven investor community with a mission of backing visionary public companies.
The potential to become market leaders in the <unk>.
Our <unk> category.
We are pleased that after extensive due diligence mtvs publix branches strongly support the economy and himself actually investing in our financing.
We believe that.
The leader in the mobile BCG space.
We are encouraged.
This public ventures built their investment thesis.
His position.
I would like now to turn the call over to our President Rob Elon.
Further discuss our strategic focus and provide broader.
Update drop.
Thank you Brenda and thanks to everyone joining us today.
Expanding on Brent as Bob has mentioned of our strategic focus we're now primarily focused on obtaining an initial five 10-K clearance from FDA for the heart beam Amy go the ECG device, followed by a second clearance on the system's ability to synthesize a 12 lead ECG.
Together these two heart PMA Amigo FDA clearance is the hardware and the system's ability to synthesize a 12 liter ECG will enable physicians to remotely monitor patients and immediately interpret any concerning cardiac events, where you see this as an important value creation path.
In addition, we'll be undertaking clinical trials in 2023 and beyond to demonstrate the performance of the heart team Amy go platform, which we believe is the most advanced ambulatory cardiac detection platform available. These.
These initial studies will focus on the 12 week synthesis and on the performance of the system as a whole. We believe these studies will be key to driving clinical and patient adoption.
We also plan to add world, leading key opinion leaders to our medical Advisory Board. These.
These kols will help guide, our clinical and regulatory development will be announced in the near future.
Our our initial commercial launch activities will be for the second version of Heartbeat. Amy go after we obtain the FDA clearance for the 12, we had equivalent we are not currently emphasizing commercial activities for either the heartbeat, Amy software product or the heart team Amy go V. One system.
This year, we will be take undertaking an aggressive pre commercial effort will be defining the initial market segments for the Heartbeat May me go system and identifying potential business partners. Both for Heartbeat may be go and other technologies in our portfolio.
And finally, we will continue aggressive development of our intellectual property through our partnership with patent first a unified technology development and patent law firm focus on creating IP leadership for development stage technology companies. The partnership is focused on the goal of creating clear leadership in the area of ambulatory <unk> cardiac.
Detection.
Now turning to our product timelines and updates we expect to file for FDA five 10-K clearance for version one of the heart being Amy go V ECG device in the coming days.
Mission is focused on the Heartbeat, Amy go hardware as a three lead collection device. Our current estimate is for clearance by the fourth quarter of 2023.
Following this first clearance we're planning a second FDA submission for version two which includes generation of synthesize 12 <unk> from the same device.
Once we have both clearances in hand, we will focus on a limited market release in pursuit of initial commercialization.
I'll now turn the call over to Rick Brownstein, Chief Financial officer to discuss operational updates and financials.
Thank you Rob.
Turning to our financials I'll now give a brief review of our financial results.
Full breakdown is available in our regulatory filings.
And in the press release that crossed the wire after market close today.
General and administrative expenses for the first quarter of 2023 were $2 5 million compared to $1 4 million for the first quarter of 2022.
This reflects the growth in our team and other costs in support of being a public company.
Research and development expenses for the first quarter of 2023 were $1 7 million compared to $1 7 million for the first quarter of 2022.
Our focus on R&D consisted largely of product development and regulatory cost for both of our products.
Pacific Me for Hurricane Amy go hardware or we have utilized our professional services agreement with Triple ring technologies.
Triple ring represented about 30% of our investment.
R&D this quarter.
Additionally, on the regulatory side or the cost of supporting our current and upcoming FDA submissions of our products.
Also invest in research costs and support our future product pipeline coming from our patented <unk> platform technology.
As the basis for our patent portfolio, which now includes 10 issued patents.
Net loss for the first quarter of 2023 was $4 1 million compared to $2 1 million for the first quarter of 2022.
We ended the first quarter of 2023 was just under $1 million in cash and cash equivalents compared to 3.6 million as of December 31 2002.
Having invested the proceeds from the November IPO and 19 in 2021 to accelerate our product development path.
Cash balance does not include the net proceeds of approximately 24 6 million.
From the common stock financing that we recently completed.
Of importance and the recent financings is the fact that the $17 7 million shares offered did not include any warrants and our balance sheet as a result, because of very simple and straightforward capital structure.
With approximately 20 million shares now standing.
Regarding our capital raise we intend to use these proceeds to achieve several important upcoming milestones.
As a result of our new strategic goals and our commercialization plan, we've reduced our budgeted cash expenses to approximately $16 million for the next 12 months.
Our focus on clinical and product development and FDA clearances.
We will not undertake commercial efforts during this period.
The balance of proceeds is expected to fund operations into late 2024 provide us our cash runway as we develop our <unk> products and as we prepare for commercialization.
We expect no material commercial revenue for 2023, but believe we've raised sufficient funds to get us to this important inflection point.
D H clearance of the second version of hard for me to go.
To reemphasize this important point with the capital raise we believe we have sufficient capital through late 2024.
I'll now turn the call back over to Brian for his closing thoughts.
Thank you Lee.
We are incredibly optimistic for the future of Hanmi.
These capital.
We are highly focused on executing on our product development clinical and regulatory.
Are there any milestones and our cash runway is now extended into late 2024.
We also adjusted our strategic focus to enable timely delivery, while Harbin breakthrough ambulatory BCD products, the company's key future value drivers.
The key element of this focus is the heartbeat, Amy go Cogs side, the EEG device beyond that.
The product pipeline, we think that.
Vacation of our official intelligence methods will be of great value to us.
We'll have a unique data set for patients who have actually reported that ECG monitoring our deep basin.
Monthly weekly or even more recently.
That will be truly loved the APAC our patient.
This relationship will be of tremendous value.
Blindness visual intelligence. This dataset. This is extremely data at each Alicia did the standards around the BTG via yield we strongly believe additional insight into cardiovascular disease and further to help cardiovascular patients.
On the right hand side of this slide.
So it's about lead patch.
As we reported last quarter, we have received a patent on that technology, which is disruptive and has the potential to make a significant impact on the battery industry projected to be eight.
$8 billion by 2000.
Yes, currently evaluating how and when.
Take advantage of this.
Yes.
Looking ahead, we remain confident in our progress milestones our next milestone or the commercialization path equaled five 10-K submission for the high beam Amy go the ECG version one rather.
Road might be FDA clearance.
I'd like to share one final thought.
We are all very excited about our partnership.
<unk> ventures.
Our refined strategic focus we believe we are closer to our goal, while making our BCD technology, a new standard of care, which in turn will help millions of cardiovascular patients around the world.
I look forward to providing our shareholders with further.
There are updates in the near term.
Great. Thank you all for your attention and would likely at this point to answer any questions that you have operator.
We will now begin the question and answer session.
To ask a question you May press Star then one on your telephone keypad.
If youre using a speakerphone please pick up your handset before pressing the keys.
If any time your question has been addressed and you would like to withdraw your question.
Please press Star then two.
Again. It is star then one if you wish to ask good audio question.
At this time, we will pause momentarily to assemble our roster.
Okay seeing that there are no audio questions.
I'd like to mention that we will now take.
Questions from webcast.
Webcast viewers.
Okay.
Okay.
First question.
Or webcast viewers.
You described an adjustment to your strategic focus.
What exactly has changed from your previous strategy now.
With the new strategy focus.
And what are you not doing.
Rob would you like to comment sure I'll take this one.
So as we mentioned the primary focus now is the heartbeat, Amy go device and in particular, obtaining the two FDA clearances that we need the first for the device and the second for the 12 week synthesis. The biggest change in this strategy is deemphasizing the commercialization of the heartbeat, mainly software products as well as.
Urgent one of heartburn, mainly go which is the three lead device before we add the 12 lead synthesis.
In other words, the first product that will be commercializing his heart being made me go V. Two system. However, this year, we will be preparing for our commercial efforts by defining the initial market segments for heartburn, mainly go and identifying potential business partners. Both for Amy go and other technologies in that portfolio.
Our next question to ask.
What is patent paas.
How will you work with them and what does this say about your IP position.
Let me answer that question.
As we described in the call patents bass.
Absolutely subsidiary <unk> MTBE is a unified technology development.
Now he has a patented law firm.
Focus on creating IP leadership for.
For companies like ours.
The partnership with patents that is focused on.
The goal of creating clear leadership.
In the area of ambulatory ECG.
Detection and we believe that we have a very strong.
Okay.
Growing actually IP position.
And it's we are Doug leaders in this emerging field ambulatory.
The ECG.
Uh huh.
It actually did.
Due diligence is MTBE and public branches, we know that they will.
Fully subscribe to that view and shared our view as well.
Pat This is Matt he's one of the attractive elements public ventures.
Yeah.
We believe we will add significant value to our IP portfolio.
And.
At this point we are confident.
They are strategic contributions to our IP.
The strategy.
Activities.
And our IP position significantly.
Our next question to ask.
Is the decision to deemphasize the amey product related to any difficulties with the FDA.
Rob. Please go ahead, great. Thank you and it looks like we had a couple of other similar questions on this so hopefully this addresses it. So so no no difficulties in the FDA process and in fact, if the regulatory process for heartburn, mainly is well underway and we've had very positive discussions with FDA.
We are still pursuing the heartbeat Amy clearance for a couple of reasons first the amey algorithm is a key part of our future Amy go product roadmap.
It uses the <unk> technology to provide additional information on top of the 12 lead for patients with potential heart attacks and thats going to be an important differentiator for us.
In addition, while our current focus is clearly on the development and regulatory clearances for Heartbeat made me go we do continue to think that the amey product can make a big impact in the hospital and the emergency room environment. So we're going to be exploring various options around its commercialization both in terms of timing and approach.
Our next question to ask.
What are you doing with the other products you've discussed in the presentation, such as the watch and AI.
Let me just say that the priority is very much with the Amy go system.
In the upcoming FDA clearances.
At the same time, we continue to have advanced development efforts on these other products in particular.
We are developing our fiduciary intelligence.
<unk>.
And we continue to believe.
This is <unk>.
Very compelling area.
Yes sort of.
<unk>.
Differentiation in the future.
This is all driven by the amount of rich data our system produces.
The same goes for the watch.
I believe.
In the future this will make for a very compelling product offering.
Our next question asks can.
You outlined the next upcoming milestones that we should look forward to track your new direction.
Yeah.
Yes in full alignment with our refined focus here.
We remain full.
Focused on the major.
<unk> event.
The submission and clearance for our <unk> product.
We will submit the initial FDA.
The implication for the first time.
This product.
The coming days.
The other upcoming milestones.
Five 10-K clearance of the first version of the day.
Advice and submission.
The second version of the device.
This will clear.
Well Lee.
<unk>.
We will continue of course to update you on our plans.
I would like to conclude by saying that you plan to announce a new key members.
The management team.
As well as the medical Advisory Board.
Our next question asks.
If you were approached by a company interested in licensing your technology would you consider it.
Thank you for that.
Rob.
I can take that and feel free to add on as.
As we've talked about business development is a really important part of our focus we realize that we have we're a small company with a lot of great technologies and IP in our portfolio. So we.
We will be certainly open to talking with all potential partners about involvement throughout the portfolio.
It's too early to say specifically about licensing for any particular technology, but wanted to emphasize that business development discussions with a range of partners is a really key part of our strategy going forward.
And our last webcast questions asked.
Our dependence do you expect the second product will be on the commercial success of the first products.
Hi, Rob.
Yeah, and I, just have to say im not 100% sure under the definitions in this product over the first and second product. So I apologize if I don't answer this question correctly.
As intended when it was asked.
The first product that we've discussed in the past as the Amy software product. We are planning to go through as we say with the FDA clearance for that which is underway and we do not have current plans to commercialize that as I mentioned, we will be focusing on.
Pushing that atwood, placing that algorithm into our <unk>.
Amy go platform going forward as well as looking at all options.
Commercializing that either directly or through partners et cetera.
And then the other products that we've talked about is the <unk>, one which we are.
<unk> to submitting that FDA application as we've said and that one again, we will not be commercialized items. So that is the hardware three we'd device and we're going to use that as the basis of our second clearance, where we do the 12 lead synthesis on top of that that same eco V to which we will be commercial.
<unk>. So <unk> was the first product, we're commercializing Amy and Amy go V. One are still key parts of the strategy is building blocks.
Okay, and now I would like to.
Just.
Ask again, if anyone has an audio question.
You May press Star then one on a touchtone phone.
Again. It is star then one if you have an audio question.
Yeah, and if you have a question on the audio side Press Star.
Then one.
Seeing no audio questions I would now like to turn the call back over to Dr. <unk> for his closing remarks.
Thank you operator.
I would like to thank each of you for joining our earnings conference call today, and look forward to continuing to update you on our ongoing progress and growth.
If we were unable to asset any of your questions. Please reach out to our IR firm MZ group, who we.
We'll be more than happy to assist.
Thank you and have a good day.
The conference has now concluded. Thank you for attending today's presentation you may now disconnect.
Okay.
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