Heartbeam Inc (BEAT) 2025 Q1 法說會逐字稿

Greetings and welcome to the HeartBeam First Quarter 2025 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 call 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 are cautioned not to place undue reliance on these forward-looking statements which reflect our opinions only as of the date of the presentation.

Please keep in mind that we are not obligating ourselves to revise or publicly release the results of any revision of 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 10K and Form 10Q for a more complete discussion of these factors and other risks, particularly under the heading risk factors.

A press release detailing these results crossed the wire this afternoon and is available in the investor relations section of our company's website, Heartbeam.com.

Your hosts today, Robert Eno, Chief Executive Officer, and Timothy Cruickshank, Chief Financial Officer, will present results of operations for the First Quarter ended March 30, 2025.

At this time I will turn the call over to HeartBeam Chief Executive Officer, Mr. Rob Eno.

Thank you, operator. The topics we'll cover on today's call are listed on the slide. We'll provide a brief reminder of the HeartBeam system and its status, followed by our progress to 2025 milestones. We'll then provide more details on the valid ECG data and the recently announced collaboration with AccurKardia.

Next, we'll touch on our commercial readiness efforts and our long-term vision, followed by financial results before turning it over to Q&A.

Before we dive into updates from the last quarter, I wanted to remind everyone about our initial product, the HeartBeam System. HeartBeam is developing the first ever personal cable-free ECG that can synthesize a 12-lead ECG. Our unique IP protected approach captures the heart's electrical signals in 3 dimensions or 3 non-coplanar directions side to side, top to bottom, and into the body. We believe bringing this 12-lead capability directly into the hands of patients is extremely disruptive to how cardiac conditions are currently managed. The system is designed to be easy to carry and easy for patients to use wherever and whenever they have symptoms.

We also believe this has the potential to be the highest resolution ambulatory ECG monitor, and that adding artificial intelligence to these high resolution signals acquired by patients longitudinally over time can result in unsurpassed algorithms providing personalized cardiac insights.

In December of last year, we received our foundational FDA 510k clearance. This is for the system as a whole for rhythmia assessment, the credit card signal collection device, the patient application, a physician portal, and signal quality algorithms. The system outputs three ECG waveforms representing the three non-coplanar directions captured by our technology.

In January we submitted our second FDA 510k application. This is for the software that synthesizes the 12 lead ECG from our 3D signals for a rhythmia assessment. This is important because it takes the high resolution signals collected by the HeartBeam system and synthesizes them into a familiar 12 lead ECG, something that physicians are used to reviewing on a daily basis. This application is currently being reviewed by the FDA. We continue to expect clearance for the software by the end of the year. These two clearances together will form the product with which we'll start our initial commercialization.

We've achieved a number of important milestones since our last call at the Heart Rhythm Society meeting last month, Dr. Tom Deering from the Piedmont Heart Institute presented the results of our valid ECG study. He announced that we met the end points for the study, which formed the basis of our FDA submission for the 12-lead synthesis software for a rhythmia assessment.

We've also made progress on the regulatory front. We're in positive and productive discussions with the FDA on the 12-lead synthesis software submission. We're in the substantive review portion of the process, and we continue to anticipate clearance by the end of the year. FDA staff have been very engaged and responsive, and we've not experienced any delays or issues related to the recent events of the FDA.

In addition, we started our interactions with the FDA on expanding our indication to include ischemia, which is inadequate blood flow to the heart. ECGs can detect electrical changes that occur during ischemic events such as heart attacks. We're engaging with the FDA to discuss our rationale and clinical study plans.

While we make progress with the FDA on the regulatory side, we're executing on our plans to become commercial ready. We're working to have the processes and systems in place to launch commercially after receiving FDA clearance on the 12-lead synthesis software.

The collaboration we recently announced with AccurKardia will add to our commercial efforts, and we'll describe that collaboration in more detail today.

Other recent developments include two new issued US patents, bringing the total to 20 issued patents worldwide. Intellectual property is very important to Heartbeam and we will continue to invest in protecting our unique technology. Also, I was appointed to the Board of Directors. I'm excited to join the board and to continue to work closely with our existing board members as we drive toward commercialization of the HeartBeam system.

Another expansion was to the membership of our scientific advisory board, adding Dr. Vivek Reddy from Mount Sinai. Dr. Reddy is a world leading electrophysiologist, and his appointment further enhances this group of preeminent cardiology advisors both in interventional cardiology and electrophysiology.

At our call in November, we laid out this framework demonstrating the key milestones for the end of 2024 and all of 2025. I'm pleased to say that we continue to make great progress in achieving these milestones. The 3 milestones in the circle are the ones we achieved since the call two months ago, announcing a strategic collaboration with AccurKardia on the arrhythmia classification algorithm, initiating discussions with the FDA on our ischemia indication, and the presentation of the valid ECG data.

On the arrhythmia classifications, I mentioned on the last call that we made a decision to prioritize a collaboration for the arrhythmia detection algorithm, pivoting from the earlier plan of conducting a clinical clinical study on the algorithm that we developed internally. We anticipate that the collaboration will result in significant savings both in time and money. I'll describe the AccurKardia collaboration in more detail in a minute.

On the ischemia indication, we have strong proof of concept data on our system's ability to detect ECG changes that are related to heart attacks and other acute coronary changes. We're excited to be engaging with the FDA to determine the regulatory and clinical plan to expand into this new indication. We continue to anticipate that later this year we'll initiate a pilot clinical study on the use of our system in patients with ischemia.

On the valid ECG data, the results of the pivotal study were presented last month at the Heart Rhythm Society, and I'll provide more details on the next slide. Before moving on, I wanted to add that one of the main objectives that Tim and I had when we started on a new position late last year was communicating and then executing on these important milestones. Since creating this list and showing it at the Earnings call in November, the team has done an exceptional job to achieve the milestones we said we were going to achieve.

The main focus for the company for the remainder of 2025 is working with FDA on the review of our 510K application and on our commercial readiness efforts. Completing these milestones will put us in a great position for a successful commercial launch.

Next, I'd like to spend a little time providing more details on two of the recent milestones the valid ECG study and the AccurKardia collaboration, as well as on our commercial readiness efforts.

So I wanted to dive deeper into the clinical results of the valid ECG pivotal study which formed the basis of our submission to the FDA on the 12 week synthesis software for arrhythmia assessment. Dr. Tom Deering from Piedmont Heart Institute in Atlanta and the former President of the Heart Rhythm Society presented the results. The study enrolled 198 patients at 5 US centers. These patients were in arrhythmia clinics and included patients with sinus rhythm and a variety of arrhythmias. They had simultaneously recorded standard 12 lead ECGs and our device. Our system then synthesized the 12-lead ECG from our signals, and these were compared to the standard 12 VDCGs.

The HeartBeam system is designed to be used by patients at home. So, this is a very important study to determine how similar our synthesized 12-lead ECGs are compared to standard 12 lead ECGs for a rhythmia assessment.

The study compared the ECG signals quantitatively. You can see an example from one of the patients here and how similar the waveforms are. The study looked at a series of ECG intervals. Those are the time between different points of the signals and amplitudes. That's the height of specific points of the signals. We reported mean differences between the standard 12 lead ECGs and our synthesized 12 lead ECGs for several intervals in amplitudes. For each of these, the were less than the margin of error you would normally see when a person measures an ECG. As you can see on the graph, the standard ECG paper is made up of large boxes and small boxes. The differences between the synthesized and standard 12 ECGs in the study were tiny, all less than 1/5 of the size of a small box.

In addition, physicians reviewed all of the ECGs and classified them as normal sinus rhythm or one of a series of arrhythmias. The physicians looked at the ECGs independently and in a blinded manner. A total of 93.4% of the time, the classification was the same between the standard 12 lead and the HeartBeam 12 lead. This is a high level of agreement similar to what you would expect when two physicians reviewed the same ECG.

So, in short, the goal of the study was to demonstrate for physicians and for the FDA that synthesized 12 lead ECGs produced from RECG taken by patients closely approximate the signals from a standard 12-wee ECG for rhythmia assessment. The study met these performance goals.

Thank you to Dr. Geering and all the investigators, collaborators, and the patients in the study for helping us achieve this very positive result.

Next, we're very excited to have recently announced a strategic collaboration with AccurKardia based in New York, AccurKardia is an ECG-led diagnostics software company. They're developing a suite of ECG algorithms, both classification and detection algorithms. The collaboration is focused on adding to the HeartBeam system AccurKardia's FDA cleared accurate ECG algorithm which automatically classifies the rhythm from the ECG signals. The HeartBeam system is designed to have two workflows. When a patient is experiencing symptoms, the ECG will be sent to a cardiologist to review and to provide the interpretation back to the. Patient. However, we want to encourage our users to take as many readings as they like to practice and to build up their data. Over time, the patient's prescribing physician can review the ECGs and notice any underlying trends. For this asymptomatic use case, we'd like our patients to receive an automated assessment of the rhythm. This is where achycardius accur ECG comes in.

We've reported previously that HeartBeam has developed a deep learning-based algorithm to classify arrhythmias. We determined that the time and expense required to bring our own solution to market would be prohibitive right now. We're excited that we can combine AccurKardia's FDA cleared solution with the FDA cleared HeartBeam solution. We're currently working with AccurKardia to determine the steps to clear this joint solution, and we'll have more details in an upcoming call.

In addition, the agreement with AccurKardia has an economic framework that will be finalizing as we move to the commercial stage. At a high level, there's no upfront payment, but we will be paying a reasonable per user fee for integrating our algorithm.

Finally, while the scope of the collaboration is currently limited to the Accur ECG algorithm, AccurKardia has an exciting pipeline of technology, and there's a potential for expanded collaborations in the future.

The two major efforts for HeartBeam this year are securing the FDA clearance for a 12-lead synthesis software and undertaking the necessary steps to become commercial ready in advance of our commercial launch, which is expected by the end of the year. We've started our early access program in which we're testing the product with concierge accounts and patients. This program is giving us incredibly valuable feedback on all aspects of our offering, including the onboarding workflow and physician and patient training while generating additional data on real world use of the HeartBeam system.

Other aspects of commercial readiness that are underway include building out the infrastructure to support the end-to-end workflow from the physician's office to the patient's home and implementing the customer support function. We're also establishing inventory and logistics support and have selected a contract manufacturer, all of which will allow us to scale the business.

Meanwhile, we're developing a comprehensive launch plan, and we'll share more details of launch approaches.

In summary, our preparations for initial commercial launch are progressing well. Before Tim discusses the financials, I wanted to step back and articulate what we see as the value we're creating here at Heartbeat.

Everything starts with our strong IP position. We now have 20 issued patents worldwide. The core of the technology enables us to create the smallest, easy to use, and first cable-free ECG device that synthesizes a 12-lead ECG. We've significantly de-risked the business through our foundational FDA clearance and significant clinical data showing similarity to a standard 12-lead ECG for arrhythmia assessment.

Next, the upcoming market introduction holds significant promise, as we described previously. Our target market segment of patients who are members of concierge in preventive cardiology practices is a $500 million dollars serviceable market in the US with a high margin recurring revenue model. Market research indicates that there's extremely strong demand from our target patients and physicians. We believe the concept is compelling and it's resonating. The unique combination of a cable-free ECG that produces a 12-lead read by cardiologists. We're exploring a number of wraparound features and services to add additional value and to drive adoption and stickiness.

Beyond our initial indication of arrhythmia, the potential to expand into ischemia and heart attack detection opens up a huge opportunity. The coronary artery disease market is larger than the atrial fibrillation market, with 20 million patients in the US who have had a prior heart attack or who are at elevated risk for one.

We intend to demonstrate our system's ability to reduce the time from the onset of symptoms to the emergency room door. A technology that achieves this will have dramatic clinical and healthcare economic benefits and the potential for significant payment by the healthcare system.

And that ties to our next area. There are a number of ways which we can expand beyond patient pay and have our technology paid for by the healthcare system, as we discussed in our last call, there are new category 3 CPT codes that have the potential to cover our technology. In addition, there are several clinical use cases in which high risk patients can benefit from having an easy to use 12 lead ECG with them at home to drive more proactive and less expensive care. We intend to engage with Medicare Advantage plans, including the so-called special needs plans or SNIPs, who have an incentive to include technologies that improve clinical care and reduce costs.

Finally, one of the most exciting elements of our technology is the breadth of opportunities that the core technology can address. First, predicted algorithms on 12 lead ECGs can screen for or even predict the likelihood of developing a variety of medical conditions. Applying these algorithms could allow HeartBeam users to have valuable and proactive information about their heart health. Training algorithms on longitudinal data taken with the HeartBeam system could allow for trending data that has not been possible.

HeartBeam has issued patents on additional form factors. An on-demand 12-le patch could be a best in class offering in the multi-billion dollar extended wear patch market. Incorporating HeartBeam's technology into a watch form factor would seamlessly integrate with continuous monitors in a single device.

In all, we're excited about HeartBeam's IP protection, de-risking, and the immediate market opportunity, but we also see it as an open-ended opportunity with the ability to make a dramatic impact on a large number of patients and change the way that cardiac care is managed.

So now I'll turn to Tim to walk through the financials.

Thanks, Rob. Great updates. Our focus on cash management is directly in line with these updates Rob gave. We've got strong financial discipline in place as we continue to de-risk the business and execute on near-term milestones.

And we'll make the, make properly timed investments into commercial readiness to be prepared for launch on the back of this upcoming FDA clearance, all the while managing to keep an eye out on the future and opportunities for strategic collaborations for our technology.

Our Q1 cash flow is indicative of this approach. We had net cash used and operating activities of $4.5 million for the quarter, but let's dive into that number. Within that spend, $3.6 million related to the recurring baseline expenditure. This is predominantly our R&D spend for clinical, regulatory and product development initiatives and GNA directly aligned with our stated milestones. In addition to that, to the baseline spend, we invested $400,000. In the quarter into commercial readiness activities and manufacturing capabilities related to launch. Rob took you through a number of those initiatives on the previous slide, which included testing with concierge accounts and patients in the early access program, as well as on boarding a contract manufacturer designed for scale.

Initial feedback from concierge accounts remains extremely positive in our current and Anticipated throughput for manufacturing is in the thousands of devices per month with the ability to duplicate and stand-up production lines at a reasonable cost.

So, we're very confident in our investments that they're well timed and that they'll lead to tremendous gains for the company in time.

The remaining spend of $500,000 was for one-off for annual payments associated with Q1 of each year and included in that were employee expenses related to a handful of roles to be eliminated during the quarter. I mentioned this just to point out that even with an already lean organization, we continue to make the necessary decisions in the best interests of the company and shareholders to ensure spend is aligned with our primary objectives and our timeline for achieving milestones.

Within the deprioritization of a few long-term initiatives, we were able to reduce our recurring spend slightly. So, to give some context, the one specific example would be the raised ECG study for arrhythmia classifications that Rob took you through. We were able to construct the alternative plan of licensing an algorithm versus conducting a full-blown clinical trial this year, and in going this other route, we were able to eliminate the cost of the trial and some of the resources previously assigned to this area.

As I stated last quarter, baseline for 2025 the spend is 14 last year was $14.5 million for operating activities in 2024.

That's a good baseline for this year and on top of that will be some well-timed expenditure on commercial readiness activities. That spend ranges from $1.5 million to $3.5 million in 2025 depending on the number of factors, including the timing of when we bring those things on.

We accomplished a lot with a relatively modest investment this past quarter of $400,000 and we'll continue to be prudent in timing moving forward. So, to summarize, we've got strong financial discipline in place as we continue to de-risk the business, but also as we look to make timely investments into commercial readiness.

Also, of note during the quarter, we completed the $11.5 million common stock public offering with MDB Capital, and we'll continue to strategically fund the company as we execute on milestones all the while managing dilution.

We're really excited about the progress we've made so far this year and the road ahead. We're confident we're putting ourselves in a great position for inflection points throughout this year and that we have the partners and pieces in place to strategically capitalize the business as we prepare for commercialization. So, we're looking forward to updating you more along the way and executing on upcoming milestones.

Rob, back over to you.

Thanks, Tim. So, in summary, we've made significant progress in the 2 months since our last call. On the clinical and regulatory front, the results of the valid ECG study were presented, and the study successfully met the clinical endpoints for arrhythmia assessment. The study is the basis of the FDA submission on the 12-week synthesis software. We're in positive and productive discussions with the FDA on the 12-lead synthesis software submission.

We continue to anticipate clearance before the end of the year. We also began engaging with the FDA on expansion of our indication into ischemia, and we expect to start a pilot study later this year.

We're making solid progress with our early access program and in setting up our internal systems and processes. We also signed a strategic collaboration with AccurKardia, which will provide an important enhancement for our commercial product.

The main corporate priorities for 2025 remain unchanged, working with the FDA on our 12-week synthesis submission and preparing for commercialization. We will continue to report on progress towards these two priorities, as Tim mentioned, we raised $11.5 million earlier this year and are managing spending closely as we approach commercialization. We will continue to strategically fund the company in line with our near-term milestones.

I'm impressed with the amazing job our employees are doing and the team's dedication and success in hitting the milestones we previously described. I look forward to continuing to update you as we make additional progress in the coming quarters. We thank you all for attending and now I would like to open up to Q&A, operator.

Thank you, we will now begin the question-and-answer session.

(Operator Instructions)

The first question comes from Bill Sutherland with the Benchmark Company. Please go ahead.

Thanks operator.

Hey Rob, Tim, congrats on all the progress.

Wanted to Rob, would you, could you give us a little more colour on kind of the, in what you learned in the early access program, this currently I guess and last quarter, just some of the information that's helping you understand kind of the commercial opportunity.

Sure, the first thing is actually getting the device into real patients' hands. So, we did extensive what we called alpha testing, which was employees and investors and friends and family, but it's a whole other level when there's patients who don't know who we are and getting them engaged in training and onboarded and looking at. Ongoing readings. So that's been having to do onboardings in a real world setting of a clinic, a cardiology clinic or a concierge clinic, and then having the patients be trained well enough to continue on their own has been really helpful.

Then also the patients are providing great feedback from their perspective of features they'd like to add or how it's going. So that's the main thing we've learned I would say from the effort so far and then in parallel obviously there's a lot of things we're doing of the supporting system so we have some of the systems in place, building out as I mentioned, the customer service and the customer support we'll start to learn from as we spin those up, learn to how those work and the details of those things in practice. So, I hope that helps.

Are you, is it too early to kind of think about how pricing may develop?

It should go commercial.

Yeah, I think it's, we've done a fair amount of market research which is good on this, and it's, resonating with what we said before, which is, we believe it's, likely somewhere between, call it $50 to $100 per month on a recurring revenue basis if you include the device as well as the. Going service but we're also exploring lots of different things in terms of pricing levels, we think we might have, tiers where a higher tier gets you things like more cardiologist reads per time period, etc. So, we're going to get a lot more detail as we get closer, but that's kind of the general direction, Tim. I don't have anything else you want to add on that.

No, I think that's really helpful. The pricing will have optionality in terms of bundles versus upfront, but we're expecting most of it to be the within the range of $50 to $100 that Rob gave from a bundle perspective based on the data we have so far.

Got it. Tim, while you're on, what, how should we think about the timing of building out the commercial infrastructure as well as you can kind of do it at this point.

Yeah, great. Rob talks a lot about this. We've got two target markets which we haven't officially announced, but we, we're going to start with two specific markets. They have about 45,000 patients between the two markets. We believe we can cover that with the sales, two sales reps and two, I'll call them clinical specialists in terms of onboarding of patients and training the trainers. And so, the relatively modest cost of a few $100,000 between each of those geographies to kind of get them on boarded on an annualized basis covers about 45,000 patients in the early days. What we plan to do is continue to gain learnings from those two markets and as we get data that tells us to invest, we'll start to look to additional markets. In the US as a second phase and then the third part is there's a high number of concierges.

Practices the rub the forgot the term for the concierge practices that are more nationwide and so the third wave will be going after that.

Portion chains of concierge practices in other words, yeah.

So, the first stage could be Tim the first stage of the two target markets could be as soon as what quarter.

On the backside of the FDA clearance, which at this point we have in the second half of the year in Q4, so we begin commercializing at the end of the year with really Q1 of '26 being when you start to see.

Start to see it really come on.

Okay, great. Great.

Yeah Bill.

Let me just I that's a great overview I'll just add quickly that you know what we've been doing now is a lot of work on you know free commercialization our head of product Richard is amazing and does kind of covers that area as well and we have consultants etc. The first thing we'll do with the appropriate time, timing it is Tim's. Said the expenditure is bringing on a person to lead the sales effort and then that person will help us finalize the plan, including the initial sales folks to cover those two regions which will kick off once we, as I say, once we get the FDA clearance and finish our commercial readiness is when we start that commercialization in those two initial markets to prove the concept.

Right, okay. Well, let me jump back in Q2 and let other people ask questions. Thanks, guys.

Sure.

Thank you.

(Operator Instructions)

The next question comes from Leo Caprio with Joseph Gunner. Please go ahead.

Good afternoon, gentlemen. I have two quick questions. First, have you been able to have any updates and conversations with the FDA in terms of where the process is going for the approval, and have you seen any disruption from the FDA in terms of giving the whole staff attrition they've had lately? And I'll have a follow up question.

Great, I'll take that.

So, first on the disruption, the good news is we haven't seen any, we haven't seen and just speaking obviously from our experience with our group and our team, we really haven't seen any disruption, or any delays related to things that have happened at FDA. They continue to be very engaged and very responsive to us and hitting all of the deadlines, so that's great. As far as the other question, all I can say is we continue to be engaged in productive discussions with them. I believe through Debbie Castillo who runs our regulatory effort. We've got great relationships with FDA and really trying to be as collaborative as possible with them. So, we're in what's called the substantive. You phase we're going back and forth in terms of questions, etc.

I can't give any more, clarity beyond what we've said, which is, we believe things are still on track for what we've said, which is clearance by the end of the year. Obviously keep you posted as things are going, but we continue to be encouraged by all the interactions.

Okay, and then the second follow-up question is regarding your AccurKardia partnership, how does that bolster your competitive position against other potential competitors to the technologies and space, and does it make your proposition a bit more palatable toward the end markets that you're trying to address?

Yeah, it definitely does, I like I mentioned in the in the earlier in the call. I think of it in terms of workflow, and I think one of our, key elements of our workflow are that when patients have symptoms, so when patients, we expect the workflow will be patients will decide to use our device. There's a smartphone application and the first thing they get asked is, are you having symptoms or is this a routine recording? When they're having symptoms, they'll use one of their credits and it'll go to a cardiology reader service for them to Interpret and get back to the patient, but we want to encourage the patients to take readings as often as they like to train and to build up their data.

So having this automated assessment is really important. Without that, we believe there's a bit of a hole in the product where either we'd have to have everything go to the reader service or they don't get a response back. So, we think it's a key part of the competitive offering to make sure that we can provide. For these routine recordings and automated assessment of basic rhythms and then actually they get that every time they do it whether it's asymptomatic or symptomatic, and then the symptomatic ones also get read by a cardiologist. So, in a sense it completes or really fills out the product pipeline and that when combined with the reader service and the synthesized 12-lead really, we think leads to a compelling. A compelling package and then as I mentioned, the collaboration is limited to that, but one of the exciting things about working with AccurKardia is they have a really exciting pipeline, including predictive algorithms. And so, getting to know them and working with them, there's always the possibility that there be things we can do to expand the partnership deeper in the future.

Okay, thank you.

To ask a question, you may press star, then one.

As we have no audio questions at the moment, I would like to turn the call over to Larry Holland for any web questions.

Our first webcast question asks, congratulations on the results of the pivotal study. You stated the study was the basis for your FDA submission, so can you expand on your takeaways from the study and what it means for clearance?

Sure, well, thank you. First of all, the goal of the study was to demonstrate that our synthesized 12-lead ECG, that that that's similar to a standard 12 lead ECG, and we did that, as I mentioned through simultaneously gathered ECGs and as I said, the study met the clinical endpoints and I think the key thing, the reason why this is important is 12 lead ECGs are the standard generally done in a healthcare setting with a healthcare practitioner, placing the ECG, and our systems designed to be used by patients outside of a healthcare facility. So, whenever they're feeling arrhythmia symptoms, they can take the reading at home instead of having to go in and have it taken by a professional. So, we have the core system cleared and working with FDA on the 12-lead synthesis software clearance, and this study supports that application because it showed the similarity between the ECGs. So, the point is if we can demonstrate that our synthesized 12 leads are very similar to a standard 12 lead, we think that really bolsters the case for FDA and also for physicians in terms of acceptance of our product.

Our next and last webcast question asks. What are your manufacturing capabilities and what is your exposure to tariffs?

Great, happy to take that one, Rob.

We mentioned on the call we signed a contract manufacturer this quarter for scaling, and we're also excited that these questions are becoming more relevant to us as we become commercial ready as we get through this year. So, a bunch of updates on this front. In addition to mentioning the tariffs, I'll give an update on our manufacturing capabilities.

So, our contract manufacturer is going to be manufacturing devices and doing final assembly at the facility at their US facilities. It's a US-based approach for this initial launch, which should help shield us from direct tariff impacts and keep our supply chain relatively stable. Most importantly, it's going to allow us to be intimately involved in the early manufacturing runs to ensure quality builds. Right now, US based components represent the majority of our parts, with the portion sourced from Europe, Japan, Taiwan. Less than 1% right now of our parts are sourced from China at present.

We're exploring opportunities to use automated manufacturing in the future as well, which we believe at a minimum should serve as a mitigation plan for unforeseen pricing impacts from tariffs and supplier costs as we start to scale.

Other areas related to manufacturing, we're actively monitoring, let's say part shortages and long lead time components. Obviously a very fluid environment, but our team and our contract manufacturer have a great handle on procurement. There are two components that we're aware of right now that we're strategizing on that will likely make advanced purchases on, but we're talking about a cost in the order of around $20,000 for those two parts to stay ahead of the issue. So, continues to be very manageable at present, but we obviously keep an open eye on this.

Our current anticipated throughput is in the thousands of devices per month, which I mentioned earlier, and we have the ability to duplicate and stand-up production lines at a reasonable cost. So, as we stand today, we're in a really good position to ramp up on a manufacturing capability.

Perspective and we'll continue to monitor componentry lead times and availability as the time comes.

That concludes our webcast Q&A.

Thank you. This concludes our question and answer session.

I would like to turn the conference back over to Rob Eno, Chief Executive Officer for any closing remarks.

Thank you, operator. I just like to thank each of you for joining the earnings conference call today. We look forward to continuing to update you on our ongoing progress and growth, and if we weren't able to answer any of your questions today, please reach out to our IR firm MC Group. We'd be more than happy to assist. Thanks.

The conference has now concluded.

Thank you for attending today's presentation. You may now disconnect.