Q4 2024 Stereotaxis Inc Earnings Call
Good morning, Thank you for joining us for Stereotaxis fourth quarter and full year 2024 earnings conference call.
Operator: Thank you for joining us for Stereotaxis' fourth quarter and full year 2024 earnings conference call.
Operator: Certain statements during the conference call and question and answer period to follow may relate to future events, expectations, and as such, constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.
Speaker Change: Certain statements during the conference call and question and actually you forget.
Speaker Change: To follow May relate to future events expectations and as such constitute forward looking statements within the meaning of the private Securities Litigation Reform Act of 90 95.
Operator: Such statements involve known and unknown risks, uncertainties, and other factors which may cause the actual results, performance, or achievements of the company in the future to be materially different from the statements that the company's executives may make today.
Speaker Change: Such statements involve known and unknown risks uncertainties and other factors, which may cause the actual results performance or achievements of the company in the future to be materially different from the statements that the company's executives may make today.
Operator: These risks are described in detail in our public filings with the Securities and Exchange Commission, including our latest periodic report on Form 10-K or 10-Q.
Speaker Change: These risks are described in detail in our public filings with the Securities and Exchange Commission, including our latest periodic report on Form 10-K or 10-Q.
Operator: We assume no duty to update the state.
Speaker Change: We assume no duty to update these statements.
Operator: At this time, all participants have been placed on listen-only mode.
Speaker Change: This time, all participants have been placed on listen only mode. The.
Operator: The floor will be open for questions and comments following the presentation.
Speaker Change: The floor will be opened for questions and comments following the presentation.
Operator: As a reminder, today's call is being recorded.
Speaker Change: As a reminder, today's call is being recorded.
David Fischel: It is now my pleasure to turn the floor over to your host, David Fischel, Chairman and CEO of Stereotaxis. Thank you, operator, and good morning, everyone. It's an exciting time at Stereotaxis. We are making significant, broad-based progress in establishing the attractive foundations on which to grow a substantial company. In tandem with our quarterly results, this morning we announced in separate press releases two significant milestones with FDA submissions made for key catheter innovation.
Speaker Change: It is now my pleasure to turn the floor over to your host David Fisher, Chairman and CEO of spirit taxes.
Speaker Change: Thank you operator, and good morning, everyone.
Speaker Change: It's an exciting time at stereo taxes, we are making significant broad based progress establishing attracted foundation on which to grow at substantial company.
Speaker Change: In tandem with our quarterly results. This morning, we announced in separate press releases two significant milestones with FDA submissions made for key catheter innovations.
David Fischel: Stereotaxis is in the midst of a major strategic transformation. I'll discuss our progress in greater detail in a moment, but this being our annual call, I want to first step back and briefly provide context for our mission, path, and strategy. Stereotaxis' overarching mission is to improve endovascular surgery with robotics. become the intuitive surgical of minimally invasive endovascular intervention. It's a huge field of medicine with tens of millions of procedures performed annually, but with essentially no robotic adoption. Unlike robots in other fields, a robot in the endovascular space must control highly flexible devices navigating through tiny, delicate blood vessels.
Speaker Change: Sir your taxes is in the midst of a major strategic transformation.
Speaker Change: Discuss our progress in greater detail in a moment.
Speaker Change: But just being our annual call I want to first step back and briefly provide context for our mission and.
Speaker Change: <unk> strategy.
Speaker Change: Sir your taxes overarching mission is to improve endovascular surgery with robotics to become the intuitive surgical minimally invasive endovascular interventions.
Speaker Change: Huge field of medicine with tens of millions of procedures performed annually, but with essentially no robotic adoption.
Speaker Change: Unlike robots in other fields, a robot in the Endovascular space, let's control highly flexible devices navigating through tiny delicate blood vessels.
David Fischel: This is particularly challenging and has led to a graveyard of failed attempts to address the field, with Stereotaxis left standing as the battle-tested flag bearer for this mission. It's an important mission, and there's significant room to improve patient care with the precision, safety, and unique mechanistic and digital capabilities of robotics. Stereotaxis approached the technical challenge of navigating the tortuous, delicate, and vascular anatomy with a unique mechanism of action, using precise, computer-controlled magnetic fields to allow for direct control of the distal tip of specialized interventional devices. Over the years, we refined the technology and demonstrated its clinical relevance and value in robust real-world use at over 100 hospitals that have treated over 150,000 patients.
Speaker Change: This is particularly challenging and has led to a graveyard of failed attempts to address the field with stereo, Texas left standing as the battle tested flag bearer for this mission.
Speaker Change: An important mission.
Speaker Change: And there is significant room to improve patient care with the precision safety and unique mechanistic and digital capabilities of robotics.
Speaker Change: So your taxes approached the technical challenge of navigating tortuous.
Speaker Change: In vascular anatomy with a unique mechanism of action using precise computer controlled magnetic fields to allow for direct control of the distal tip of specialized intervention devices.
Speaker Change: Over the years, we refined the technology and demonstrated its clinical relevance and value a robust real world use and over 100 hospitals that have treated over 150000 patients.
Speaker Change: While our technology was advanced and differentiated we suffered from key structural and strategic limitations.
David Fischel: While our technology was advanced and differentiated, we suffered from key structural and strategic limitations. We didn't develop or sell the catheters needed in a robotic procedure, creating unhealthy dependencies, commercial and operational stress, limited innovation and a poor razor without the razor blade business model. A robot was never advanced to the point where it could be easily adopted, limiting access to the hospitals interested in its benefits and making rapid scaling essentially impossible.
Speaker Change: We didn't develop or sell the catheter is needed in a robotic procedure, creating unhealthy dependencies commercial and operational stress limited innovation and a poor razor without the razor blade business model.
Speaker Change: A robot was never advanced to the point, where it could be easily adopted limiting access to the hospitals interested in its benefits and making rapid scaling essentially impossible.
David Fischel: We remain focused on one specific clinical application, minimizing the platform potential of our technology to help patients with a variety of clear eyed and intellectually honest on these issues, a comprehensive and elegant strategy was developed to address them. It was creative and required significant innovation, but was realistic for us to accomplish while controlling technological and financial risk. It's attractive as it addresses each of our core structural issues, establishes a solid foundation for a healthy business. provides strict independence. For Commercial Purpose. Most importantly, for the patients and physicians that rely on us, our innovation to improve and broaden our positive impact.
Speaker Change: We remain focused on one specific clinical application minimizing the platform potential of our technology to help patients with a variety of diseases.
Speaker Change: Your IDE and intellectually honest on these issues are comprehensive and elegant strategy was developed to address them.
Speaker Change: It was creative and required significant innovation.
Is it realistic for us to accomplish but controlling logical and potential risk.
Speaker Change: These attractive as it addresses each of our core structural issues.
Speaker Change: The solid foundation for a healthy business.
Speaker Change: Strict strict independence.
Speaker Change: Okay.
Speaker Change: Commercial break out.
Speaker Change: Most importantly for the patients and physicians that rely on us our innovation to improve and broaden our positive impact.
Speaker Change: Our strategy rescue four primary pillars.
David Fischel: Our strategy rests on four primary First, making our robot widely available by innovating it such that it doesn't require construction and can be rapidly installed in the majority of labs. Second, building an ecosystem of catheters and integrations in our core EP ablation market so physicians have greater choice in technologies while we reduce our dependencies and build an attractive razor blade business. Third, developing the right interventional devices so that our robot becomes a platform for endovascular surgery more broadly, providing value in several new clinical indications. and FORCE, establishing a digital backbone that introduces connectivity and AI to our robots and the broader CAF Lab environment.
Speaker Change: First.
Speaker Change: You cannot robot widely available by innovating it such that it doesn't require construction and can be rapidly installed and the majority of labs.
Second building, an ecosystem of catheters and integrations in our core EP oblation market. So physicians have greater choice and technologies, while we reduce our dependencies and building attractive razorblade business.
Speaker Change: Third developing the right intervention devices, so that our robot becomes a platform for endovascular surgery, more broadly providing value and several new clinical indications.
Speaker Change: And Floris establishment of digital backbone that introduces connectivity and AI to irobot and the broader Cath lab environment.
Speaker Change: River affected we've invested significant effort in many tens of millions of dollars advancing these four pillars.
David Fischel: For the last decade, we've invested significant effort and many tens of millions of dollars advancing these four pillars. have progressed in parallel, and we are in the late stages of bringing this strategy through key regulatory and commercial models.
Speaker Change: It progressed in parallel and we are in the late stages of bringing the strategy through key regulatory and commercial milestones.
Speaker Change: While most of this progress was done organically, we made a significant leap forward last year with the strategic acquisition of ADT, which brought us in house advanced catheter development and manufacturing capabilities to complement our internal robotic expertise.
David Fischel: While most of this progress was done organically, we made a significant leap forward last year with the strategic acquisition of APT, which brought us in-house advanced catheter development and manufacturing capabilities to complement our internal robotic expertise. There being so many moving parts to our innovation strategy, I'll touch upon each key technology and the recent milestones and near-term regulatory and commercial expectations. The Genesis X robot received CE mark in Europe and was submitted for U.S. regulatory approval in the third quarter of last year. Initial commercial launch in Europe required availability of a compatible catheter, and so with receipt of MAGIC catheter approval in Europe in January, we announced the first firm order for a Genesis X robot.
Speaker Change: There being so many moving parts to our innovation strategy I'll touch upon each key technology and the recent milestones and near term regulatory and commercial expectations.
Speaker Change: To Genesis X robot received CE Mark in Europe, and was submitted for U S regulatory approval in the third quarter of last year.
Speaker Change: Initial commercial launch in Europe required availability of a compatible catheter.
Speaker Change: Each of Magic catheter approval in Europe in January we announced the first firm order for Jonathan sacks robot.
David Fischel: We expect installation and first use of Genesys X at that European hospital this summer. It will be an important milestone to demonstrate that we're working reliably in the rigorous environment of daily clinical use. In the U.S., we received questions from the FDA in October, the majority of which were very technical and focused on cybersecurity. We've decided to make software updates to enhance technology cyber security, have completed the development and testing of those updates, and plan to imminently submit our full response to all of FDA's questions. In tandem, we've been working to enhance compatibility of the robot with various x-rays and preparing our supply chain manufacturing, installation, and commercial properties processes for a full launch.
We expect installation and first use of jennison.
Speaker Change: That European Hospital this summer.
Speaker Change: It will be an important milestone to demonstrate the working reliably in the rigorous environment of daily clinical use.
Speaker Change: In the U S. We received questions from the FDA in October the majority of which will very technical and focused on cyber security.
Speaker Change: We've got.
Speaker Change: Software updates and technology cyber security have completed the development and testing of those updates and claim to imminently submit our full response to all of the Fda's questions.
Speaker Change: In tandem we've been.
Speaker Change: Working to enhance compatibility of the robot with fur X rays, and preparing our supply chain manufacturing installation and commercial properties.
Speaker Change: For a full launch.
Speaker Change: And then the revolutionary ease with which we can now install a robot.
David Fischel: Given the revolutionary ease with which we can now install a robot, we are bringing fully functional Genesys X robots to the two most important electrophysiology conferences in our field. The European Heart Rhythm Association conference at the end of this month in Vienna, and the Heart Rhythm Society conference in April in San Diego. Having Genesys X at our booth and being able to navigate a portfolio of EP and vascular catheters with it is a very tangible demonstration of the dramatic technological transformation taking place. With market visibility of Genesis X at these conferences and first commercial use in summer, we're setting the stage for successful full launch of Genesis X in both Europe and the U.S.
Speaker Change: Felipe.
Felipe: Sure Dennis This X robot to the two most important electrophysiology conferences in our field European Heart Rhythm Association conference at the end of this month in Vienna.
Felipe: Rhythm Society Conference in April in San Diego.
Felipe: And Jamie <unk> at our booth and being able to navigate a portfolio of EP and vascular catheters with it is a very tangible demonstration of the dramatic technological transformation taking place.
Felipe: With market visibility of attendance at these conferences and first commercial use in summer we're setting the stage for successful full launch of Gen. <unk> in both Europe and the U S. In the second half of this year.
David Fischel: in the second half of this year. We believe it's reasonable to expect a few Genesys X system sales this year, scaling to double-digit number of systems next.
Felipe: We believe it's reasonable to expect a few Genesis X system sales this year scaling to debit double digit number of systems next year.
Felipe: Okay.
Felipe: Shifting to the portfolio of catheters.
David Fischel: Shifting to the Portfolio of Cap. A few weeks ago, we were excited to announce European CE Mark approval of the Magic Ablation Capsule. Regulatory approval caps a significant multi-year development, clinical and regulatory effort. I mentioned in that announcement, we're grateful for all of those who contributed to advancing the catheter and look forward to the substantial impact MAGIC will have. Since the approval, we've been busy working through initial administrative efforts across our EU hospitals and the necessary manufacturing and supply chain activities. We expect first sales of MAGIC at multiple hospitals in March and for that to scale to approximately a million dollars of MAGIC revenue per quarter in Europe by the end of this year.
Felipe: Few weeks ago, we were excited to announce European CE, Mark approval of the Magic ablation catheter.
Felipe: Regulatory approval capped a significant multiyear development clinical and regulatory officer.
Felipe: I mentioned in that announcement, we have.
Felipe: So for all of those who contributed to advancing the catheter and look forward to the substantial impact magic wheelhouse.
Felipe: To start approval, we've been busy working through initial administrative efforts across our EU hospitals, and the necessary manufacturing and supply chain activities.
Felipe: We expect first sales of magic at multiple hospitals in March and for that to scale to approximately $1 million of magic revenue per quarter in Europe by the end of this year.
In the U S. We continue working closely with FDA on the PMA regulatory submission.
David Fischel: In the U.S., we continue working closely with FDA on the PMA regulatory submission. appreciate FDA's constructive dialogue and a continued thorough review of our submission. In parallel, we continue to enroll patients in the ongoing study in Europe to support the specific label discussed with FDA. We believe U.S. MAGIC approval in the second half of this year to be a reasonable time.
Felipe: We appreciate fda's constructive dialogue and a continued thorough review of our submission.
Felipe: In parallel we continue to enroll patients in the ongoing study in Europe to support the specific label discussed with FDA.
Felipe: We believe U S magic approval in the second half of this year to be a reasonable timeline.
Felipe: Our pipeline of robotic EP catheter innovations goes far beyond magic with high density mapping and pulsed field ablation being the most exciting and impactful efforts in our nearer term pipeline.
David Fischel: Our pipeline of robotic EP catheter innovations goes far beyond magic, with high-density mapping and pulse field ablation being the most exciting and impactful efforts in our nearer-term pipeline.
Felipe: We were delighted this morning to be able to announce regulatory submission of magics week.
David Fischel: We're delighted this morning to be able to announce regulatory submission of MagicSuite. first ever robotically navigated high-density mapping cap. High-density mapping has transformed the EP field, and the availability of a robotic high-density mapping catheter offers new clinical benefits to our EP users, expands the value proposition of robotics as a whole, and provides for significant incremental commercial opportunities.
Felipe: First ever Robotically navigated high density mapping catheter.
Felipe: Items mapping has transformed VP field and the availability of our robotics high density mapping catheter offers new clinical benefits to RVP users expands the value proposition of robotics as a whole and provides for significant incremental commercial opportunity.
Speaker Change: A highly prominent EP kols, while who used us regularly but it is not currently inactive user was quoted in today's press release, describing the importance of the catheter and how the lack of a mapping catheter has held back overall adoption of robotics.
David Fischel: A highly prominent EPKOL, one who used us regularly but is not currently an active user, was quoted in today's press release describing the importance of the catheter and how the lack of a mapping catheter has held back overall adoption of robotics. Magic Sweep promises rapid and detailed electroanatomical mapping with the precision and inherent safety of our technology, the ability to map otherwise difficult-to-reach areas of the heart, and more anatomically accurate maps by avoiding distension caused by rigid caps. There's a substantial body of VPs who think similarly to that KOL and are excited to use the CAP.
Speaker Change: Magic sweep promises rapid and detailed electronic chemical mapping with the precision and inherent safety of our technology.
Speaker Change: Ability to map otherwise difficult to reach areas of the heart.
Speaker Change: And Laura anatomically accurate maps by avoiding distension caused by Richard catheters.
Speaker Change: There is a substantial body of vps, who think similarly to that Kols and are excited to use the catheter.
David Fischel: Magic Sweep is a 510K submission, and we expect regulatory approvals in both Europe and the U.S. in the third quarter. The revenue opportunity for Magic Sweep is similar in scale to the Magic Ablation Capital. We expect MAGIC and MAGICSweep to increase our disposable revenue per procedure approximately fivefold.
Speaker Change: <unk> suite is a five 10-K submission and we expect regulatory approvals in both Europe and the U S in the third quarter.
Speaker Change: The revenue opportunity for magic sweep similar in scale to the magical ablation catheter.
Speaker Change: We expect magic and magic week to increase our disposable revenue per procedure approximately fivefold.
David Fischel: Having MagicSuite available shall also expand the pipeline of users of robots. In PFA, we have continued to make progress with several partners in robotic PFA catheter solutions. We've done extensive preclinical tests with three such partners now, each an independent shot to bring a good solution to mark. We expect at least one of these solutions to enter first in human testing this year and believe one could be available commercially in Europe within a year. While PFA is dramatically impacting the overall cardiac ablation market, Stereotaxis' clinical use has predominantly focused on complex VT, PVC, and congenital arrhythmias in which robotics enables procedures that would otherwise be very difficult to be done successfully, safely, or at all.
Speaker Change: Having magic suite available to also expand the pipeline.
Speaker Change: Users of robotics.
Speaker Change: In <unk>, we have continued to make progress with several partners in robotic PFA catheter solutions.
Speaker Change: We've done extensive preclinical tests with three such partners know each independent shot to bring a good solution to market.
Speaker Change: We expect at least one of these solutions center first in human testing this year and believe one could be available commercially in Europe within a year from now.
Speaker Change: While <unk> dramatically impacting the overall cardiac ablation market.
Speaker Change: Texas is clinical use is predominantly focused on complex VT pvt, and congenital arrhythmias, and which robotics enables procedures that would otherwise be very difficult to be done successfully safely at all.
David Fischel: This focus largely shields us from the competitive dynamics currently playing out in the field. Those dynamics are distracting for our customers. Having a PFA solution further advanced in our pipeline will be beneficial in addressing the longer term aspirations of our customers.
Speaker Change: This focus largely shields us from the competitive dynamics currently playing out in the field. So those dynamics are distracting for our customers.
Speaker Change: Having a PFA solution further advanced in our pipeline will be beneficial in addressing the longer term aspirations of our customers.
Speaker Change: In an additional press release. This morning, we shared our second regulatory milestone with FDA submission of imagine our first ever vascular catheter.
David Fischel: In an additional press release this morning, we shared a second regulatory milestone with FDA's submission of IMAGINE, our first-ever vascular catalog. Development of a family of interventional guide wires and catheters expands the benefits of our robots into multiple new endovascular indications by enabling efficient and safe navigation to otherwise difficult-to-reach vascular anatomy. Imagine 5S is a robotically steered 5 wrench catheter and the first catheter in this portfolio.
Development of our family of Interventional guide wires and catheters expands the benefits of our robots into multiple new endovascular indications by enabling efficient and safe navigation to otherwise difficult to reach vascular anatomy.
Speaker Change: Imagine buybacks is a robotically steered five French catheter and the first catheter in this portfolio.
David Fischel: There are several large medical devices. within neurointerventions, interventional cardiology, and interventional radiology, where we believe IMAGINE can be helpful. The catheter was a 510K submission and we expect regulatory approvals in both Europe and the U.S. in the third quarter. while the short-term revenue contribution of Imagine will likely be modest. Strategic value is substantial. Our near-term focus following approval will be to demonstrate the clinical utility of our robot in the treatment of stroke, cancer, and several cardiovascular diseases. As that clinical value is substantiated, it significantly expands the value proposition of our robots to hospitals and multiplies our addressable market.
Speaker Change: There are several large medical device markets within neuro intervention, interventional cardiology and interventional radiology, we believe imagine can be helpful.
Speaker Change: The catheter was a five 10-K submission and we expect regulatory approvals in both Europe and the U S in the third quarter.
Speaker Change: While the short term revenue contribution of imagine will likely be modest strategic value is substantial.
Speaker Change: Our near term focus following approval will be to demonstrate the clinical utility of a robot in the treatment of stroke cancer and several cardiovascular diseases.
Speaker Change: As a clinical value is substantiated it significantly expands the value proposition of our robots to hospitals and multiplies our addressable market.
Speaker Change: So this has already been a long set of updates there are two other material innovations to discuss.
David Fischel: So this has all already been a long set of updates. There are two other material innovations to discuss.
Speaker Change: In China, our <unk>.
David Fischel: In China, our partner, Microport, recently received regulatory approval for the Genesis robot, Magbot catheter, and integrated Columbus mapping. Approval of this product ecosystem allows Microport to begin commercial efforts in China, where we see significant opportunity for our technology, given the EP market size, the interest in our technology, and the alignment with a large local partner with an existing EP sales force.
Speaker Change: Partner, Mike Report recently received regulatory approval for the Genesis robot <unk> catheter and integrated Columbus mapping systems.
Speaker Change: Approval of this product ecosystem allows micro part to begin commercial efforts in China, where we see significant opportunity for our technology given the EP market size the interest in our technology and the alignment with a large local partner with an existing EP salesforce.
Speaker Change: I wasn't China, two weeks ago, visiting our partners there.
David Fischel: I was in China two weeks ago visiting our partners. with good engagement and there's excitement about our opportunity, though it's difficult to estimate near-term commercial results. of a pipeline of over a dozen hospitals with demonstrated interest and engagement in the sales process, though the macroeconomic environment and anti-corruption campaigns are significant headwinds. Microport is also still working on nearer term structural items that will help adoption such as pursuing regional reimbursements for the Magbot catheter and submitting genesis for various provincial probes.
Speaker Change: With good engagement and there is excitement about our opportunity.
Speaker Change: <unk> estimate near term commercial results.
Speaker Change: With a pipeline of over a dozen hospitals.
Speaker Change: Demonstrated interest and engagement in our sales process.
Speaker Change: So the macroeconomic environment and the corruption campaigns are significant headwinds.
Speaker Change: Great report was also still working a nearer term structural items that will help adoption such as pursuing regional reimbursements for the <unk> catheter and submitting genesis for various provincial programs.
Speaker Change: The final significant innovation effort nearing regulatory milestones is our digital surgery platform enables operating room connectivity and smart AI capabilities in the Cath lab.
David Fischel: The final significant innovation effort nearing regulatory milestones is our digital surgery platform that enables operating room connectivity and smart AI capabilities in the cath lab. Cognizant Syncs digitize the various disparate systems in a cath lab, allow for seamless control of all of those systems from a consolidated cockpit, offer modern cloud-based connectivity between the lab and the external world, and provide attractive opportunities for smart AI features to be integrated into the operating system. The technology was originally intended for use alongside a robot and has been designed also as a very attractive independent offering across non-robotic cats.
Speaker Change: Ian sinks.
Speaker Change: <unk> the various disparate systems and accounts lab allows for seamless role of all of those systems from a consolidated cockpit.
Speaker Change: For modern cloud based connectivity between the lab and external world and provide attractive opportunities for smart AI features to be integrated into the operating room.
Speaker Change: The technology was originally intended for use alongside robot has been designed also has a very attractive independent offerings across non robotic cath labs.
David Fischel: We've been working through formal regulatory testing and software refinements to Synchrony and Sync, with plans to unveil the system at HRS in April, with regulatory approvals first in Europe and then in the U.S. mid-year.
Speaker Change: We've been working through formal regulatory testing and software refinements to synchrony in sync with plans to build a system at HRS in April with regulatory approvals first in Europe, and then in the U S mid year.
David Fischel: Incorporating Hardware will provide an incremental upfront capital sales opportunity, while Think will be available with a freemium SaaS business model. The commercial impact of this technology will likely be modest this year, with expectations of approximately $1 million in revenue, but we believe this will grow significantly in 2026 and beyond.
Speaker Change: Well.
Speaker Change: Hardware will providing an incremental upfront capital sales opportunity, while sync will be available with a freemium SaaS business model.
Speaker Change: The commercial impact of this technology will likely be modest this year with with expectations of approximately $1 million in revenue, but we believe this will grow significantly in 2026 and beyond.
Speaker Change: As you can see it's a particularly busy and exciting period full of meaningful regulatory and initial commercial efforts for several technologies across three key geographies.
David Fischel: As you can see, it's a particularly busy and exciting period full of meaningful regulatory and initial commercial efforts for several technologies across three key geographies. It will be the year in which we demonstrate the tangible reality of our overall strategic transformation into a company with an easily-adopted robot that can navigate a proprietary set of catheters in E.P. and broadly across endovascular pathways. These milestones will increasingly contribute to commercial results as we progress through the year and sets us up for breakout growth as we look towards 2020.
Speaker Change: It will be the year in which we demonstrate the tangible reality of our overall strategic transformation to a company and easily adopted robot now.
Speaker Change: I'll get a proprietary set of catheters.
Speaker Change: Our broadened across Endovascular procedures.
Speaker Change: These milestones will increasingly contribute to commercial results as we progress through the year and sets us up for breakout growth as we look towards 2026.
Speaker Change: Jim will now provide additional commentary on our financial results and then I'll make a few financial comments as well before opening the call up to Q&A.
Kimberly Peery: Kim will now provide additional commentary on our financial results, and then I'll make a few financial comments as well before opening the call to Q&A.
Jim: Thank you David and good morning, everyone.
Kimberly Peery: Thank you, David, and good morning, everyone. Revenue for the fourth quarter of 2024 totaled $6.3 million, a 39% year-over-year increase compared to $4.6 million in the prior year fourth quarter. System revenue for the fourth quarter was $1.4 million, compared to system revenue of $0.1 million in the prior year fourth quarter. Recurring revenue of $4.9 million reflects a full quarter's contribution from our recent acquisition of APT, and compares to $4.5 million in the prior year fourth quarter.
Speaker Change: Revenue for the fourth quarter of 2024 totaled $6 3, million% to 39% year over year increase compared to $4 6 million in the prior year fourth quarter.
Speaker Change: System revenue for the fourth quarter was $9 4 million compared to system revenue of $1 million in the prior year fourth quarter.
Speaker Change: <unk> revenue of $4 9 million reflects a full quarter contribution from our recent acquisition of ADT and compares to $4 5 million in the prior year fourth quarter revenue for the full year 2024 totaled $26 9 million compared to $26 8 million in 2023.
Kimberly Peery: Revenue for the full year 2024 totaled $26.9 million, compared to $26.8 million in 2023. Full year system revenue was $8.6 million, compared to $8.7 million in the prior year, and we start at 2025 with system backlogs of $15.2 million. Full year recurring revenue was $18.3 million, compared to $18 million, with continued capital shortages by Johnson & Johnson offset by the contribution of ATT. Chris, margin for the fourth quarter and full year 2024 were approximately 51% and 54% of revenue. For the full year, recurring revenue gross margin was 70% and system gross margin was 20%. Recurring margins remain negatively impacted by the accounting related to the acquisition of APT, which causes minimal accounting gross margin on the sale of acquired inventory.
Speaker Change: Full year system revenue was $8 6 million compared to $8 7 million in the prior year and we started 2025 with system backlog of $15 2 million.
Speaker Change: Full year recurring revenue was $18 3 million compared to $18 million with continued catheter shortages by Carrington and Johnson offset by the contribution of ATT.
Speaker Change: Margin for the fourth quarter, and full year, 2024, or approximately 59% and 54% of revenue.
Speaker Change: During the full year recurring revenue gross margin was 70% and system gross margin was 20% recurring margins remained negatively impacted by the accounting related to the acquisition of ADT, which causes minimal accounting gross margin on the sale of acquired inventory.
Kimberly Peery: We expect to work through this inventory by the middle of this year and recurring margins to benefit accordingly. System gross margin continues to reflect the allocation of significant overhead expenses on low production volumes. Operating expenses in the quarter of $10.8 million included $2.5 million in non-cash stock compensation expense and a $1.1 million non-cash mark-to-market adjustment for acquisition-related contingent earnings considerations. Excluding these non-cash charges, adjusted operating expenses were $7.2 million. Adjusted operating expenses for the full year 2024 were $27.4 million, compared with $26.2 million in the prior year. Operating expenses in the fourth quarter and full year include the addition of APT operating expenses following closing of the acquisition.
Speaker Change: Do you expect to work through this inventory by the middle of this year and recurring margins to benefit accordingly.
Speaker Change: System gross margin continues to reflect the allocation of significant overhead expenses and lower production volume.
Speaker Change: Operating expenses in the quarter at $10 8 million, including $2 5 million in noncash stock compensation expense and a $1 1 million noncash mark to market adjustment for acquisition related contingent earn out consideration.
Speaker Change: Excluding these non cash charges.
Speaker Change: Operating expenses were $7 2 million adjusted operating expenses for the full year 2024 were $27 4 million compared with $26 2 million in the prior year.
Speaker Change: Operating expenses in the fourth quarter and full year include. The addition of ADT operating expenses following closing of the acquisition.
Speaker Change: Operating loss and net loss in the fourth quarter of 2024 of our seven 6 million and $7 5 million compared with $5 3 million and $5 million in the previous year.
Kimberly Peery: Operating loss and net loss in the fourth quarter of 2024 were $7.6 million and $7.5 million compared with $5.3 million and $5 million in the previous year. Adjusted Operating Loss and Adjusted Net Loss for the quarter, excluding non-cash stock compensation expense and the mark-to-market adjustment, were $4 million and $3.8 million, compared with $2.7 million and $2.4 million in the previous year. For the full year 2024, adjusted operating loss of $12.8 million and adjusted net loss of $12.1 million compared to an adjusted operating loss of $11.3 million and an adjusted net loss of $10.2 million in the prior year.
Speaker Change: Adjusted operating loss and adjusted net loss for the quarter, excluding noncash stock compensation expense and the mark to market adjustment of $4 million and $3 8 million compared with $2 7 million and $2 4 million in the previous year.
Speaker Change: For the full year 2024, adjusted operating loss of $12 8 million and adjusted net loss of $12 1 million compared to an adjusted operating loss in Atlanta.
Speaker Change: $3 million and an adjusted net loss of $10 2 million in the prior year.
Kimberly Peery: Positive free cash flow of $1.3 million for the fourth quarter reflected cash receipts on previous system revenue. Negative free cash flow for the full year was $8.5 million compared to $9.5 million for the full year 2023.
Speaker Change: Positive free cash flow of one 3 million for the fourth quarter reflected cash receipts on previous system revenue.
Speaker Change: Free cash flow for the full year was $8 5 million compared to $9 5 million for the full year 2023.
Kimberly Peery: At December 31, Stereotaxis had cash and cash equivalents, including restricted cash of $12.4 million and no debt.
Speaker Change: At December 31st stereo taxes had cash and cash equivalent including restricted cash at $12 4 million and no debt.
David Fischel: I will now hand the call back to David. Thank you, Kim. I'll add a few comments on how we're looking at both revenue and cash use over the coming year.
David Fisher: I'll now hand, the call back to David.
Thank you Kim I'll add a few comments on how we're looking at both revenue and cash use over the coming year.
David Fischel: With many moving parts and product launches, equitably guiding revenue. Throughout the prepared remarks, I provided color on how various individual product launches can impact revenue. For capital in 2025, it is prudent to expect revenue to remain approximately flat with 2024, with system revenue in any given quarter of $2 to $3 million. This does not assume significant sales in China and reflects modest Genesis X assumptions as a full launch in the second half of this year will more significantly contribute to 2020 sales. Recurring revenue should steadily grow throughout the year with increasing contribution from an expanded portfolio of capital.
David Fisher: With many moving parts and product launches accurately guiding revenue is changing.
Throughout the prepared remarks, I provided color on how various in the vet individual product launches can impact revenue.
David Fisher: For capital in 2025, it is prudent to expect revenue to remain approximately flat with 2024 with system revenue in any given quarter of $2 million to $3 million.
David Fisher: This does not assume significant sales in China and reflects modest Genesis acts assumptions as a full launch in the second half of this year will more significantly contribute to 2026.
David Fisher: Our recurring revenue steadily growth throughout the year with increasing contribution from an expanded portfolio of catheters.
David Fischel: We currently expect $5 million of recurring revenue in the first quarter, going sequentially over the course of the year to $7 million in the fourth quarter. Accumulative result of both our capital and recurring revenue expectations to double-digit annual growth in 2025.
David Fisher: We currently expect $5 million of recurring revenue in the first quarter <unk> sequentially over the course of the year $11 million in the fourth quarter.
David Fisher: The cumulative result of both our capital and recurring revenue expectations.
David Fisher: Double digit annual growth in 2025.
David Fischel: Regulatory milestones and early commercial efforts this year set us up for more substantial growth in 2026. From an expense and task perspective, we expect to keep adjusted operating expenses flat over the next few quarters as our existing commercial team is well-suited to manage the initial commercial rollout of our technology. As we progress through commercial launches, we plan to continue investing in our commercial capabilities with this investment funded by the incremental profit from those new products.
David Fisher: Regulatory milestones and early commercial efforts this year set us up for more substantial growth in 2026.
David Fisher: Certainly an expansion asper effective we expect to keep adjusted operating expenses flat over the next few quarters at our existing commercial team is well suited to manage the initial commercial rollout of our technologies.
David Fisher: As we progressed throughout two commercial launches we plan to continue investing in our commercial capabilities, which is investments funded by the incremental profit from those new product launches.
David Fischel: In 2024, we used about $8 million in cash. Our burn rate in 2024 was lower than 2023, despite significant costs related to the acquisition and integration of APT. With growing recurring revenue and stable operating expenses, we expect reduced cash use in 2025. We view our existing balance sheet as allowing us to reach key milestones, commercialize our innovations, and profitably grow.
David Fisher: In 2024, we used about $8 million in cash.
David Fisher: Our burn rate in 2024 was lower than 2023, despite significant costs related to the acquisition and integration of <unk>.
David Fisher: With growing recurring revenue and stable operating expenses, we expect <unk> cash use in 2025.
David Fisher: We view our existing balance sheet is allowing us to reach key milestones commercialize our innovations and profitably grow.
David Fisher: We will now take your questions. Operator can you. Please open the lines for Q&A.
Operator: We'll now take your questions.
Operator: Operator, can you please open the line to Q&A? We will now begin a question and answer session. If you have dialed in and would like to ask a question, please press star 1 on your telephone keypad to raise your hand and join the queue. If you would like to withdraw your question, simply press star 1 again.
Speaker Change: We will now begin the question and answer session dial in and we'd like to ask a question. Please press star one on your telephone keypad to raise your hand and joined the Q2 I would like to withdraw your question simply press Star one again.
Frank <unk>: Our first question comes from the line of Frank <unk> from Lake Street capital markets.
Frank Takkinen: Our first question comes from the line of Frank Takkinen from Blake Street Capital Markets. Great. Thanks for taking the questions. Congrats on all the progress.
Frank <unk>: Great. Thanks for the questions. Congrats on all the progress David I was hoping I could start with just a little bit more color around magic in the U S market I know you said likely a second half approval, but you can kind of walk us through where we are today and what needs to occur between then and now to be on time with the second half approval of magic.
David Fischel: David, I was hoping I could start with just a little bit more color around Magic in the U.S. market. I know you said likely a second half approval, but kind of walk us through where we are today and what needs to occur between then and now to be on time with the second half approval of Magic. Sure. Hi. Good morning, Frank. So, we mentioned in the prepared remarks a few things. We're enrolling patients in Europe, continuing to enroll patients in Europe with specific indications that meet the unmet medical need criteria that FDA wanted for our label.
Frank <unk>: Sure Hi, good morning, Frank.
Frank <unk>: So we mentioned in the prepared remarks, a few things we are enrolling patients in Europe, continuing to enroll patients in Europe.
Frank <unk>: Specific indications that meet the unmet medical need criteria that FDA wanted for our label and so that's kind of ongoing and.
David Fischel: And so, that's kind of ongoing, and there's not a definitive number that we need to reach. So, I don't think that's going to be a gatekeeper to regulatory approval, though that is helpful for the approval process the more patients we enroll in that. And so, that's ongoing in Europe. In the meantime, the FDA has been doing a very detailed review of the PMA submission. We receive questions during that process, and then we kind of respond, and we respond to those questions and kind of refine the submission based on those questions. And so, that's kind of ongoing in parallel.
Frank <unk>: And there is not.
Frank <unk>: Definitive number that we need to reach so I don't think thats going to be a gatekeeper to regulatory approval, but that is helpful. For the approval process. The more patients we enroll in that and so that's ongoing in Europe in the meantime, the FDA has been doing a very detailed review of the PMA submission we received questions Ed during that process.
Frank <unk>: And then and then we kind of respond in kind of then and we respond to those questions and kind of refine the submission based on those questions and so that's kind of ongoing in parallel.
David Fischel: And those are kind of the two main bodies of effort that are ongoing. Obviously, a regulatory review has many different sections. It's not split up the same way as it is in Europe where you have kind of those three sections, and you're given questions in each one, and you have to respond to each one. It's a more comprehensive review of the entire submission, but those are each. There is the opportunity also for an audit of the manufacturing facility in Germany, though it's not clear that that's going to be necessary. But that's something that could take place close to approval.
Frank <unk>: Those are kind of the two main bodies of efforts that are ongoing.
Frank <unk>: We see a regulatory review has many different section it's not split out the same way as it is in Europe, where you have kind of those three sections, and then and Youre getting questions in each one and you have to respond to each one is more comprehensive review of the entire submission, but those are each there is the opportunity also for an audit of the manufacturing facility in Germany and.
Frank <unk>: That said, it's not clear that that's going to be necessary, but EM, but that's that's kind of that's something that could take place at close to approval and so those are the things that are going on in parallel and it is a substantial amount of our effort internally is to is to make sure we're able to respond to FDA and two to kind of run that progress forward.
David Fischel: And so, those are the things that kind of are going on in parallel, and it is a substantial amount of our effort internally is to make sure we're able to respond to FDA and to kind of run that progress forward. FDA is aware of some of the challenges in the field given our dependencies on Johnson & Johnson and how those have harmed some of our users and the patients that they want to treat. And so, FDA is working on this in a very collaborative fashion to try to make sure it could do a thorough review in a timely fashion.
Frank <unk>: FDA is aware of kind of.
Some of the challenges in the field given our dependencies.
Frank <unk>: Johnson and Johnson and how those have harm that as some of our users in the patient that they want to treat and so the FDA is working on this in a very collaborative fashion to try to make sure. We could do a thorough review in in a timely fashion.
Speaker Change: Got it that's helpful. And then maybe moving over to sweep can you just talk a little bit about how this is going to fit into the broader ecosystem and how it may or may not impact your relationship with Abbott and that mapping collaboration.
David Fischel: Got a couple.
David Fischel: And then maybe moving over to Sweep, can you just talk a little bit about how this is going to fit into the broader ecosystem and how it may or may not impact your relationship with Abbott and that mapping collaboration? Sure. So, Magic Sweep is a high-density mapping catheter. In the majority of robotic procedures now, as it is in the majority of manual procedures, a physician will use a high-density mapping catheter prior to the ablation portion of the procedure. So they'll, you know, while they're standing, even in a robotic procedure, while they're standing at the bedside, gaining access to the patient, introducing sheets, they'll, typically in a robotic procedure up until now, they will introduce a high-density mapping catheter, whether it's a pentarray or an HD grid or something similar, and they'll start to move it around manually, build out a high-density map of the heart chamber, and then once they have a high-density map, they will pull it out, insert a robotic ablation catheter, unscrub, go sit behind the computer, and perform the ablation portion of the procedure robotically.
Speaker Change: Sure So and magic sweep is a high density mapping catheter in the majority of robotic procedures now as it is in the majority of manual procedures, a physician will use the high density mapping catheter.
Speaker Change: Prior to the ablation portion of the procedure.
Speaker Change: While they are standing even in a robotic procedure, while they are standing at the bedside.
Speaker Change: Gaining access to the patient introducing sheet.
Speaker Change: Dale.
Speaker Change: Typically in a robotic procedure up until now they will introduce high density mapping catheter, whether it's a pent array or an HD grade or something similar and.
Speaker Change: <unk>.
Speaker Change: Start to move it around manually build out high density map of the heart Chamber and then once they have a high density map they will.
Speaker Change: Pull it out in sort of robotic ablation catheter S. On scrubbed go sit behind the computer and performed.
Speaker Change: <unk> portion of the procedure Robotically, because that's kind of a very typical workflow and I'd say the majority of our cases.
David Fischel: So that's kind of a very typical workflow, I'd say, in the majority of our cases. There's different schools of thought in electrophysiology. There's a lot of heterogeneity in procedures, though, so it isn't, there's no kind of one workflow fits all, but that is a very common one, and there are, there's a large body of EPs that view the mapping portion of the procedure as the most important part of the procedure, and they'll spend the majority of the time of a procedure mapping rather than ablating. And so for those physicians... doing the majority of the procedure manually, and then unscrubbing and putting in a robotic ablation catheter to do a short portion of the procedure, never felt worth it.
Speaker Change: <unk>.
Speaker Change: Is different schools of thought intellectual physiology, and Theres a lot of headroom in the Navy and procedures, though so it is in them. There is no kind of one one workflow fits all but that is a very common one and there are.
Speaker Change: Large body of E&ps that view of the mapping portion of the procedure as the most important part of the procedure now spend the majority of the time of a procedure mapping rather than in <unk> and for those physicians.
Speaker Change: Doing the majority of the procedure manually and then on scrubbing and putting in a robotic ablation catheter to do a short portion of the procedure never felt worth it and so they are kind of over the years and this has played out over a really over almost 10 years already and.
David Fischel: And so they have kind of over the years, and this has played out over, really over almost 10 years already, they kind of stopped using the robot. And so having a high-density mapping catheter that is robotically driven and that provides those same kind of core benefits of safety, of being able to reach any area you want, of being able to go to places with precision, those are core value propositions of our robotic mechanism, which also have a lot of pull in the mapping portion of the procedure. And so that's kind of where we see significant value.
Speaker Change: Okay, and what has stopped using the robot.
Speaker Change: And so having a high density mapping catheter that is robotically driven and that provides those same kind of core benefits of safety of being able to reach any area, you're one of being able to go to places with precision.
Speaker Change: Our core value propositions of our robotic mechanism of action, which also have a lot of them a lot of pull in.
Speaker Change: In the mapping portion of procedure and so so that's kind of where we see significant value. This has been something asked by us for years and years and years and this is actually how we were first introduced with ADT and why the relationship with ADT. Originally started long before we ever imagine doing an acquisition and so that.
David Fischel: This has been something asked by us for years and years and years, and this is actually how we were first introduced with APT and why the relationship with APT originally started long before we ever imagined doing an acquisition. And so that's there. We have kind of, you know, our partners are fully aware of this development. It is part of a broader strategy, which includes other catheters we've not yet discussed. And so I think there's no concern or harm about how this comes out with our partners. They're well aware of everything we're doing. Got it. That's helpful.
Speaker Change: That's there.
We have the.
Speaker Change: Kind of.
Speaker Change: Our partners are fully aware of this development.
Speaker Change: It is part of a broader strategy, which includes other catheters, we have not yet discussed.
Speaker Change: And so I think theres no theres, no concern or harm to validate how this comes out with our partners others, they're well aware of everything we're doing.
Speaker Change: Got it that's helpful. Thanks for all the color thanks for taking the questions.
Frank Takkinen: Thanks for the color. Thanks for taking the questions. Thanks a lot.
Speaker Change: Thanks, a lot.
Speaker Change: Our next question comes from the line of Adam made from Piper Sandler.
Adam Maeder: Our next question comes from the line of Adam Maeder from Piper's Ambler. Hi, good morning. Thank you for taking the questions and congrats on the Imagine Vascular and EP mapping submissions.
Speaker Change: Hi, Good morning, Thank you for taking the questions and congrats on the imagine vascular and EP mapping and submissions.
Adam Maeder: Maybe just to start on the system, the guidance, David, I just wanted to kind of unpack that. I think you said $2 to $3 million per quarter for 2025 for system revenue, a little bit below the street. So, just maybe help us better understand that because it does feel like you have tailwinds for this segment with the Genesis X launch in Europe. You have Genesis in China. Perhaps that's more back and loaded. And then you have the system, you know, backlog, which is 15 million plus heading into 2025. So, you know, I guess the question is kind of how much of this is conservatism?
Speaker Change: Maybe just to start on the system the guidance David.
Speaker Change: Just wanted to kind of unpack that I think you said $2 million to $3 million per quarter for.
Speaker Change: For 2025 for system revenue, a little bit below the.
Speaker Change: Street so.
Speaker Change: Maybe help us better understand that because it does feel like you have tailwind for this segment with the Genesis X.
Speaker Change: Launch in Europe, you have Genesis and China, perhaps that's more back end loaded.
Speaker Change: Loaded.
Speaker Change: And then you have the system backlog, which is $15 million plus heading into 2025. So.
Speaker Change: The question is kind of how much of this is conservatism.
David Fischel: You know, is it a revenue recognition kind of dynamic and streetless modeling? Or is there something that's kind of, um, Is there a headwind here that emerged that we're not contemplating? So, maybe just, again, kind of walk us through all of that.
Speaker Change: Is it a revenue recognition kind of dynamic in the street is modeling in or is there something thats kind of.
Speaker Change: Yeah.
Speaker Change: There is there are headwinds here that's emerged that were not contemplated so maybe just again kind of walk us through all that and then sorry, one clarification would just be on Genesis ex commercial timing.
Adam Maeder: And then, sorry, one clarification would just be on Genesis X commercial timing in the US. Did you give an update there? Thank you.
Speaker Change: In the U S did you give an update there. Thank you.
Speaker Change: Sure. Thanks, a lot for those questions.
David Fischel: So when we look at system guidance, I think we want to put in things, as you've seen over previous quarters, there is huge volatility in any given quarter and difficulty in estimating correct timing of revenue recognition in any quarter. And so we wanted to give guidance that's based on, first, our backlog and the backlog that we are very confident of transitioning into revenue recognition, given kind of construction that's ongoing or kind of timing where we already have timing alignments with the hospital of when we're shipping a system. And so that is obviously the majority of the expectation for this year, is a transition of some of our genesis backlog into revenue based on kind of what we know actually is being constructed and being shipped.
Speaker Change: And so when we look at system guidance I think we want to be.
To put in things as you've seen over previous quarters. There is huge volatility in any given quarter any kind of.
Speaker Change: Difficulty in estimating correct timing of revenue recognition.
Speaker Change: Kind of in any quarter and so we wanted to give kind of guidance. That's based on first our backlog and the backlog that we are very cognizant of it.
Speaker Change: Transitioning into revenue recognition.
Speaker Change: Any kind of construction thats ongoing or kind of timing, where we already have timing alignment with the hospital when we're shipping it system and so that that is obviously the majority of the expectation for this year is a transition of some of our genesis backlog into recur into revenue.
Speaker Change: Based on kind of based on kind of what we know actually is being constructed and being gas ships and then we have them obviously, our Genesis X order that we just received in and that will also become revenue recognition as soon upon shipment and otherwise we're being very.
David Fischel: And then we have, obviously, our Genesis X order that we just received, and that will also become revenue recognition soon upon shipment. And otherwise, we're being very conservative.
Speaker Change: <unk> like I mentioned.
David Fischel: Like I mentioned in the prepared remarks, I was in China two weeks ago. I was spending a lot of time with our partners. We have a pipeline of interested physician and hospital customers. There is actual engagement on sales processes, but it is tough to estimate. Should we have one or two system sales in China this year? Should we have five system sales in China this year? It is very, very hard to estimate that. And so it feels better not to estimate that and to let that play out however it does. And if we have opportunities to increase guidance in the future to beat our guidance, that sounds like a better way to play things than trying to estimate a best guess at this point.
Speaker Change: In the prepared remarks I was in China, two weeks ago I was spending a lot of time with our partners and we have a pipeline of interested physician and hospital customers. There is actual engagement on sales processes, but it is tough to estimate should we have one or two system sales in China. This year should we.
Speaker Change: Five system sales in China. This year. It is very very hard to estimate that and so it feels better not to estimate that and to let that play out. However, it does and if we have opportunities to increase guidance in the future.
Speaker Change: Our guidance that sounds like a better way to play things and trying to estimate a best guess at this point and so those are those are kind of some of the some of the color I guess going on in our minds as we think about the guidance.
David Fischel: And so those are kind of some of the color, I guess, going on in our minds as we think about the guidance. That's really helpful, David.
David Fisher: That's really helpful David and just.
David Fischel: And just the timing for Genesys X commercial approval in the U.S., do you have an update there? And then I had one follow up. Sure. So we mentioned kind of for approval of Genesis X in the U.S., we're going to be responding very, very soon to the questions that were sent to us by FDA. I don't see any real concern in those questions or in kind of the approval process for Genesis X. We went through kind of similar approval just a few years ago with Genesis. So I kind of, I see that as a low-risk regulatory process.
David Fisher: The timing for Genesis X commercial approval in the U S. Do you have an update there and then I had one follow up thanks.
David Fisher: Sure so.
David Fisher: We mentioned for approval of <unk> in the U S. We're going to be responding very very soon to the questions that were sent to us by FDA I don't see it.
David Fisher: Any real concern in those questions or in in kind of the approval process for <unk>. We went through kind of similar approval in just a few years ago with Genesis. So I kind of I see that as a low risk regulatory process. I think we're going to have <unk> approved before we have either of the compatible catheters that could be.
David Fischel: I think we're going to have Genesis X approved before we have either of the compatible catheters that could be used with it. And now the portfolio of compatible catheters that could be used with it kind of in order to make Genesis X useful in the U.S. would be obviously the Magic Ablation Catheter, but also Magic Sweep or the Magic 5S. Any of those three would could be the first one to get approved, would be compatible with Genesis X, and would allow for initial use of Genesis X in the U.S. And so hopefully we'll get one of those approved in the third quarter is our expectation, and at least more than one of those approved in the third quarter is our expectation.
David Fisher: He used with it and now with the portfolio compatible catheters that could be used with it.
David Fisher: In order to make sense next useful in the U S would be obviously, the magical ablation catheter, but also magic sweep or their margin ties out any of those three catheters would could be the first one to get approved would be compatible with Genesee Saxon would allow for initial use of tax in the U S and so and <unk>.
David Fisher: We will get one of those approved in the third quarter is our expectation and at least for more than one of those approved in the third quarter is our expectation and then and so that that would kind of allow us to start the commercial launch.
Adam Maeder: And so that would kind of allow us to start the commercial launch then. Okay, perfect. Very helpful.
Speaker Change: Okay, perfect very helpful and for the follow up wanted to ask about the.
Adam Maeder: And for the follow-up, I wanted to ask about the vascular guidance catheter imagined. So maybe just help us understand kind of what's assumed in the guidance. It doesn't sound like there's much there, but wanted to see if you could... In terms of the indications and pecking order, I saw neurovascular, RDN, complex PCI, oncology kind of all listed in the chart. you know, in the press release. So just kind of help us think through kind of How are you going to prioritize that and how do you monetize those opportunities? Thanks for taking the questions. So, you're right that there is not any real expectation of revenue from the Imagine 5F catheter in our guidance.
David Fisher: The vascular guidance catheter.
David Fisher: And so maybe just help us understand kind of what's assumed in our guidance. It doesn't sound like there's much there but wanted to see if you could.
Speaker Change: Give us a little bit more color and then in terms of the indications and pecking order I saw neuro vascular I saw RDM Eisai complex PCI oncology kind of all listed in the.
Speaker Change: In the press release, so just kind of help us think through kind of how.
Speaker Change: How are you going to prioritize that and how do you monetize those opportunities.
Speaker Change: Thanks for taking the questions.
Speaker Change: Sure.
Speaker Change: So you're right.
Speaker Change: Right that there is not any real expectation of revenue from you imagine <unk> catheter in our guidance and I think that even if you sell that you have a few hundred or a few hundred.
David Fischel: I think that, you know, even if you sell, you know, you have a few, a hundred or a few hundred catheters sold, that's, at the end of the day, you know, it's in the low six figures. So, it's not something that's worth putting into guidance at this point, given also the uncertainty on regulatory, when we're going to get regulatory approval exactly.
Speaker Change: Catheter. So that's an end of the day.
Speaker Change: It's in the.
Speaker Change: The low six figure so it's it's not something that's worth putting into guidance at this point given also the uncertainty on regulatory widened we're going to get regulatory approval exactly but that is.
David Fischel: But that is, getting Imagine out in the real world is one of the most exciting things for me, and I think one of the biggest strategic value drivers for Stereotaxis. And we have always been a single specialty robot that is not doing justice to the potential of this technology to really become a platform broadly in endovascular surgery. And the beauty of the Imagine portfolio of catheters and wires, and how those can enable our robot to become a multi-specialty platform robot, is that we are not building the therapeutic devices themselves. We're building guidance devices, and that fits into our core value proposition of navigating tortuosity efficiently and safely.
Speaker Change: Adding Manhattan out in the in <unk>.
Speaker Change: Real World is one of the most exciting things for me and I think one of the biggest strategic value drivers for stereo taxes.
Speaker Change: We have always been a single specialty robot that is not doing justice to the potential of this technology to really become a platform broadly in endovascular surgery and the beauty of the.
Speaker Change: Managing portfolio of catheters, and wires and how those can enable our robot to become a multi specialty platform robot is that we are not building to therapeutic devices themselves. We're building guidance devices and that fits into our core value proposition of navigating tortuosity efficiently and safely.
David Fischel: And so, that kind of, our Imagine catheter can enable a host, a whole range of procedures, like the ones you mentioned. And you can still use whichever therapeutic device, which the physician prefers to use. And still, there's kind of enough value added, as you saw from some of the quotes in our press release. There is kind of a lot of expected value to be added in those procedures. And so, it will be, I think, very, very exciting as we're able to start to demonstrate the first 10, 20 procedures done in, you know, in this specific industry, you know, treating ischemic stroke, or in treating renal denervation, or in treating complex coronary cases, or lower limb peripheral cases, or triple A graft cases.
Speaker Change: And then and so that kind of are.
Sure.
Speaker Change: Imagine catheter can enable a host a whole range of procedures like the ones you mentioned and and you can still use whichever therapeutic device.
Speaker Change: The physician prefers to use.
And still there is kind of enough value added as you saw from some of the some of the quotes in our press release and there is kind of a lot of expected value to be added in those procedures and so it will be I think very very exciting as we're able to start to demonstrate the first 10000 procedures done in specific <unk>.
Speaker Change: The stream treating ischemic stroke.
Speaker Change: Or in treating renal denervation or in treating complex coronary cases are lower than peripheral cases are AAA graft cases, theres a series of <unk>.
David Fischel: There's a series of each one of them being substantial medical device markets, where we think we can add meaningful clinical value. And being able to start to demonstrate that, and transitioning the image of stereotaxis out there in the world from not just being an EP robot, but being a platform endovascular robot. I think that is one of the biggest value drivers for the company possible. And I think we're going to do very nicely there over the next couple of years.
Speaker Change: Each one of them being substantial medical device market, where we think we can add meaningful clinical value and being able to start to demonstrate that and transitioning.
Speaker Change: The image of stereo taxes out there in the world from not just being an EP robot, but being a platform Endovascular robot I think that is one of the biggest value drivers for the company possible and I think we're going to do very nicely there over the next the next couple of years.
Speaker Change: Thank you for the color.
Adam Maeder: Thank you for the color. Thank you.
Speaker Change: Thank you.
Speaker Change: Our next question comes from Jason Wittes from Roth Capital Partners.
Jason Wittes: Our next question comes from Jason Wittes from Block Capital Park. Hi, thanks for taking the questions.
Jason Wittes: Hi, Thanks for taking my questions.
Jason Wittes: I guess, you know, kind of a follow up to the guidance, what's in the guidance, am I right to assume there's only roughly three to $4 million related to magic launch in Europe and nothing related to the US launch, potential US launch in the second half for magic and guidance right now? Hey Jason, good morning. Yeah, we didn't put anything for US Magic Revenue in the guidance. We don't know exactly when the timeline of approval is, so it felt safer to focus on the disposables where we do have kind of much more confidence and visibility in their timelines, which is obviously Magic in Europe, and kind of a little bit for Magic Suite in Europe and the US in the back half of the year.
Speaker Change: Guess kind.
Speaker Change: Kind of a follow up to the guidance what's in the guidance.
Speaker Change: Our right to assume there's only.
Speaker Change: Roughly $3 million to $4 million related to.
Speaker Change: Magic launch in Europe, and nothing related to the U S launch potential U S launch in the second half for.
Speaker Change: <unk> in guidance right now.
Jason Wittes: Hey, Jason Good morning, Hey, Yes, we didn't put anything for U S. <unk> revenue in the guidance, we don't yet know exactly when the timeline of approval is so it felt that felt safer to focus on.
Jason Wittes: Disposables, where we do have kind of that much more confidence and visibility in their timelines, which is obviously magic in Europe and and.
Jason Wittes: And kind of a little bit for matrix suite.
Jason Wittes: In Europe, and the U S in the back half of the year.
David Fischel: Is there capacity constraints related to magic or are you ramping up manufacturing as we speak? Yep, we're ramping up manufacturing as we speak in Europe and so kind of the two big efforts are on the one side working with every hospital to get kind of through whatever administrative processes are required at each hospital. You have to submit your pricing, you have to usually various regulatory documentation to the hospital. Many of them have their own questionnaires that you have to fill out and you have to just walk, you know, work through that administrative process and then on the second side is the ramping of manufacturing and so those are kind of the two main efforts that are the, you know, they'll be ongoing throughout the year.
Jason Wittes: Got it and is there is there.
Jason Wittes: Capacity constraints related to magic or you're ramping up manufacturing as we speak.
Jason Wittes: One way to think about.
Jason Wittes: Yeah.
Jason Wittes: We're ramping up manufacturing as we speak in Europe, and so kind of the two the two big efforts are on.
Jason Wittes: On the one side.
Jason Wittes: And with every hospital to get kind of that through whatever administrative processes are required at each hospital you have to submit your pricing you have to use at least submit various regulatory documentation to the hospital. Many of them have their own questionnaires that you have to fill out and you have to just walk work through that administrative process.
Jason Wittes: And then on the second side is the ramping of manufacturing and so those are kind of the two main efforts that are.
There will be ongoing throughout the year. Some of those will fall very quickly and that's why we have some sales that we expect already now in the.
David Fischel: Some of those will fall very quickly and that's why we have, you know, some sales that we expect already now in the, you know, this month and then there's others that the administrative process at hospitals will take three months, six months, even, you know, nine months sometimes depending on if there's tenders required in those countries.
Jason Wittes: This month, and then there's others that that administrative process that hospitals will take three months six months nine months, sometimes depending on if theres tenders required in those in those countries.
Jason Wittes: Got it and then you mentioned.
David Fischel: And then you mentioned the mapping catheter, I'm just curious in terms of, well, two things related to this. One, what kind of frequency do you anticipate that being used with MAGIC or whatever other catheter they may use? And then secondly, I think you gave a number where you think that, I think those two catheters combined should increase catheter sales fivefold.
Jason Wittes: The mapping catheter.
Speaker Change: Just curious in terms of well two things related to this one what kind of frequency do you anticipate that being used.
Speaker Change: With with magic or whatever other captives. They may use and then secondly, I think you gave a number where you think that I think those two catheters combined should increase catheter sales fivefold.
Speaker Change: Is that the right I'm, just curious kind of what the math is behind behind those assumptions.
David Fischel: Is that the right, I'm just curious kind of what the math is behind all those assumptions. Sure, that's a great question, and it's interesting. I think that kind of in the majority of our procedures right now high density, a manually held high density mapping catheter is being used in the robotic procedure, and when I say a majority, it's, you know, it's not 55% and it's not 85%, probably somewhere in between there. So I guess, you know, roughly two-thirds of the procedures, 70-75% probably use a high-density mapping catheter. So it's a, you know, it's a good amount that use it.
Speaker Change: Sure. That's a great question and it's interesting I think that kind of in the majority of our procedures right now high density are manually.
Speaker Change: <unk> high density mapping catheter is being used in the robotic procedure and when I say majority it's.
Speaker Change: 55% and it's not 85%.
Speaker Change: Somewhere in between there so I guess roughly two thirds of the procedures.
Speaker Change: 70%, 75% probably use a high density mapping catheter.
Speaker Change: It is a good amount that use it I E. I believe that when a robotic user is doing a robotic case and there isn't available robotic high density mapping catheter I think that will be a very attractive solution for them and so I think youre going to see a good uptake there and we're obviously going to have to.
David Fischel: I believe that when a robotic user is doing a robotic case and there is an available robotic high-density mapping catheter, I think that will be a very attractive solution for them. And so I think you're going to see a good uptake there, and we're obviously going to have to prove, right, like in everything new, you're going to have to demonstrate it, and they're going to have to experience it, and then they're going to have to kind of gain their internal confidence to transition on their own. But I think that's going to be kind of an attractive offering.
Speaker Change: Prove right like in everything new Youre going to have to to demonstrate it and we're going to have to experience. It and then we're going to have to kind of gain their internal confidence to transition on their own, but I think that thats going to be kind of an attractive offering again, it's something that's been asked of us for years really years by many many physicians to do something like this so I think it will be.
David Fischel: Again, it's something that's been asked of us for years, really years by many, many physicians to do something like this. So I think it will be exciting, and I think there will be also new users who just have always kind of seen that, let's say even at hospitals that have a robot, that have seen the robot there, they know it exists, they just say, you know, if I'm already doing the majority of my procedure, the mapping portion, and manually, why should I use the robot? And I think this will allow us to engage with those physicians much better and to increase the pool of users of our robot in total.
Speaker Change: Will be exciting and I think there will be also new users, who just have always kind of been seen that let's say even at hospitals that have a robot that have seen the robot there. They know it exists they just say.
Speaker Change: If I'm already doing the majority of my procedure of the mapping portion and mentally why should I use the robot and I think this will allow us to engage with those physicians much better and to increase the pool of users of our Royal property total so.
David Fischel: So I don't know what exactly the capture rate will be in terms of our procedures, whether it will be, you know, 50% or 70%, or it could be even, you know, in some ways kind of one-to-one if you start to have some users who start to use MagicSuite, you know, who weren't using otherwise our robot for ablation. So it could be kind of somewhere in that range, probably in terms of the capture rate of a robotic mapping catheter. And then the ASPs are relatively similar between an ablation catheter and a high-density mapping catheter. There aren't substantial differences.
Speaker Change: I don't know what exactly the capture rate will be in terms of our procedures, whether it will be 50% or 70% or or it could be even.
Speaker Change: In some ways kind of one to one if you start to have some users who start to use magic suite.
Speaker Change: Who werent using otherwise a robot for ablation, so it could be kind of somewhere in that range and probably in terms of the capture rate of robotic mapping catheter and.
Speaker Change: And then the Asp's are relatively similar between an ablation catheter and high density mapping catheter that aren't dead.
Speaker Change: Substantial differences in different countries, it's slightly different but and but they are relatively similar and so when you look at our <unk>.
Jason Wittes: In different countries, it's slightly different, but they're relatively similar. And so when you look at our, you know, approximately global average ASP of $1,000 per procedure that we make currently on our one disposable, the QuickCast disposable, and you add on top of that expectations for Magic and MagicSuite, it does increase our revenue per procedure by more than fivefold. And so that's where that kind of those statements came from. Got it. Thanks for all the detail. I'll jump back.
Speaker Change: Approximately global average ASP of $1000 per procedure that we make currently on our one disposable for quick cash disposable and you add on top of that expectations for magic and magic sweep. It does increase our revenue per procedure by by more than fivefold and so that's that's where that kind of stuff.
Speaker Change: Those statements came from.
Speaker Change: Got it thanks for all the detail I will jump back in queue.
Speaker Change: There are no further questions at this time.
Operator: There are no further questions at this time.
David Fischel: I'll turn the call back over to you. Okay, thank you very much for the questions and for the continued support. We look forward to an exciting couple of months and speaking again in May. Thank you.
Speaker Change: The official I'll turn the call back over to you.
Speaker Change: Okay. Thank you very much for the questions and for the continued support we look forward to an exciting couple of months and speaking again in may. Thank you.
Speaker Change: Meeting is now concluded. Thank you for joining you may now disconnect.
Operator: Meeting is now concluded.
Operator: You may now disconnect.
Speaker Change: [music].
Operator: Thanks for watching!
Speaker Change: Okay.