Icecure Medical Ltd (ICCM) 2024 Q4 法說會逐字稿

Good morning and thank you for standing by. (Operator Instructions) Please be advised that today's conference call is being recorded.

I would now like to turn the call over to Michael Polyviou. Please go ahead.

Thank you, Joni, and welcome to IceCure Medical's conference call to review the financial results as of and for the 12 months ended December 31, 2024, and provide an update on recent operational highlights. You may refer to the earnings press release that we issued earlier this morning.

Participating on today's call are IceCure Medical's CEO, Eyal Shamir; and company's CFO and Chief Operating Officer, Ronen Tsimerman.

Before we begin, I will now take a moment to read a statement about forward-looking statements. This call and the question-and-answer session that follows contain forward-looking statements within the meaning of the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995 and other federal securities laws.

Words such as expects, anticipates, intends, plans, believes, seeks, estimates and similar expressions or variations of such words are intended to identify forward-looking statements. For example, we are using forward-looking statements in this presentation when we discuss prospective US FDA De Novo marketing authorization for ProSense in early-stage low-risk breast cancer with endocrine therapy, the belief that sales data from North America, Europe, and Japan may show that a positive marketing clearance outcome in the US may lead to higher adoption of ProSense and drive further sales momentum in global market.

The expected filing by Terumo Corporation for regulatory approval for ProSense for breast cancer in Japan. That regulatory approval for XSense is expected in Israel and that additional third-party data on ProSense are expected to be published in medical journals and presented at prestigious medical conferences throughout 2025. Because such statements deal with future events and are based on IceCure's current expectations, they are subject to various risks and uncertainties and actual results, performance or achievements of IceCure could differ materially from those described in or implied by the statements during this call.

The forward-looking statements contained or implied during this call are subject to other risks and uncertainties, many of which are beyond the control of the company, including those set forth in the Risk Factors section of the company's annual report on Form 20-F for the year ended December 31, 2024, filed with the Securities and Exchange Commission on March 27, 2025, which is available on the SEC's website, www.sec.gov.

The company disclaims any intention or obligation, except as required by law, to update or revise any forward-looking statements, whether because of new information, future events or otherwise. This conference call contains time-sensitive information and speaks only as of the live broadcast today, March 27, 2025.

In addition, during the course of this call, we will discuss certain metrics that are non-GAAP measures, and we refer you to the reconciliation tables and other information about these non-GAAP measures included in the earnings press release that we issued earlier this morning.

I will now turn the call over to IceCure Medical's CEO, Eyal Shamir. Eyal, please go ahead.

Thanks, Michael. Hello, everyone, and thank you for joining us today to review our full year 2024 results. We are encouraged by the 42% increase in product sales in North America as well as sales momentum in Europe, Japan, and other parts of Asia. We continue to see adoption of ProSense cryoablation in numerous indication across the globe as evidenced by 33 investigator initiative studies presented and published during 2024, the majority of which were with respect of breast cancer. Other indications included kidney, lung, bone and soft tissue cancers.

Early this month, we participated for the first time at the St. Gallen Breast Cancer Conference in Austria. The event was mostly geared towards breast surgeons and oncologists, and we received a good deal of interest at the IceCure booth. We had six abstracts of ProSense cryoablation at the St. Gallen, including data of ICE3 illustrating a growing interest of breast cancer cryoablation in the European market where the treatment already has regulatory clearance.

We believe the increased sales and investigator-initiated studies demonstrate rising interest for ProSense that may gain further momentum if the FDA responds favorably to our De Novo marketing authorization request for early-stage low-risk breast cancer with endocrine therapy. Additionally, we will be supporting a breast cryoablation course at the 2025 Society of Breast Imaging Conference and a preconference breast ultrasound course at the 2025 American Society of Breast Surgeons Conference next month.

As we continue to wait the FDA decision, we believe several factors are leading to a longer-than-expected timeline. This includes the novelty of ProSense as a medical device that destroys breast cancer tumors. If approved, ProSense will be the first medical device for the treatment of breast cancer. Other factors include the inclusion of many important stakeholders in their decision-making process and the evolving situation at the FDA.

Nevertheless, we remain engaged with the FDA, and we are hopeful for a favorable decision especially in light of the favorable recommendation from the FDA Medical Device Advisory Committee panel meeting last November. The advisory panel, which includes breast surgeons, interventional radiologists, breast oncologists and representatives from the patients, consumer and regulatory communities voted in favor of the ProSense benefit-risk profile in early-stage low-risk breast cancer.

We also believe the advisory panel has a public forum that (inaudible) deeply into our ICE3 data and evaluated ProSense potential impact on women health, which a large number of doctors and patients who have not been previously aware of our minimally invasive cryoablation treatment as an alternative to standard of care lumpectomy. We believe this public forum as well as growing body of investigator-initiative study around the world is and will generate rising interest in the ProSense in the US. As a result, our US sales and distribution team is ready to support the doctors and patients upon the FDA decision.

As a leader in liquid nitrogen breast cryoablation, we continue to innovate and patent new technology, including our next-generation cryoablation system, XSense, it is already FDA cleared in the US and for the same indication that ProSense currently has, and we will seek to get it approved in other global jurisdictions.

Now I will turn the call over to Ronen to go over the numbers.

Thank you, Eyal. As Eyal mentioned earlier, growth momentum continues for ProSense sales and we're particularly pleased with the 42% year-over-year sales increase in North America. For the 12 months ended December 31, 2024, product sales increased by 8% to $3.19 million compared to $2.96 million for the 12 months ended December 31, 2023, driven primarily by the increase in sales in North America as well as in Europe, Japan and other territories in Asia.

Total revenue when including revenue recognition and other services from Terumo Corporation agreement in Japan was up slightly to $3.29 million for the 12 months ended December 31, 2024, as compared to $3.23 million for the 12 months ended December 31, 2023, due to the increase in product sales, which was partially offset by a decrease in revenue recognition and other services in Japan of $100,000 and $274,000 in the 12 months of 2024 and 2023, respectively.

Gross profit increased by 12% for the 12 months ended December 31, 2024, to $1.45 million from $1.3 million for the 12 months ended December 31, 2023. Gross margin increased to 44% for the 12 months ended December 31, 2024, compared to 40% in the 12 months ended December 31, 2023. Non-GAAP gross profit, which represents gross profit from sales of our products, not including revenue recognition from Japan, increased by 32% to $1.35 million for the 12 months ended December 31, 2024, compared to $1.03 million for the 12 months ended December 31, 2023.

Non-GAAP gross margin for the 12 months ended December 31, 2024, increased to 42% from 35% for the 12 months ended December 31, 2023. Reconciliations of these non-GAAP figures are included in the earnings press release that we issued earlier today. Total operating expenses for the 12 months ended December 31, 2024, was $17.15 million compared to $16.89 million for the 12 months ended December 31, 2023. The slight 2% increase was due to an increase in sales and marketing expenses partially offset by a reduction in research and development and general and administrative expenses.

Net loss increased slightly by 5% to $15.32 million or $0.30 per share during the 12 months ended December 31, 2024, compared to a net loss of $14.65 million or $0.32 per share for the same period last year. As of December 31, 2024, the company had cash and cash equivalents of approximately $7.6 million. As of March 24, 2025, the company has cash and cash equivalents of approximately $6 million.

Between January 13, 2025, and March 24, 2025, the company raised $2.6 million in net proceeds from the sales of 2,047,277 ordinary share under its at-the-market offering facility. We continue to be very diligent in our cost management, while prioritizing investment in marketing and sales as well as research and development for our next-generation technologies.

Our stable and growing gross profit margins on sales of products, combined with increases in sales, position us well as we await FDA's decision which, if favorable, is expected to have a positive impact on future financial results.

Operator, we will now open the call for Q&A.

(Operator Instructions) Kemp Dolliver, Brookline Capital Markets.

Great. So I've noticed recently that you had a cryoablation procedure done at Emory Hospital in the US. And I'm curious how much other similar activity is going on right now as you await FDA approval and what investments you've made so far in a US commercial effort?

Yes. Thank you, Kemp. This is Eyal. We have other activities. We have not published some of the names, if they are not allowing us to do it, but Emory started to work, we saw publication on UCLA, Mayo Clinic and other important sites in the US participating to treat breast tumors as well as other private and mid clinics. And all of the sales that we had in 2024 was related to breast tumors.

That's great. And how many people do you have in the US, now?

I think that we mentioned it in the past. At the moment, we have our small, very focused team, 2 sales rep, VP -- Mr. Shad Good, Vice President sales for North America, who is bringing with him over 20 years of experience in the breast field mainly from Johnson & Johnson, Mammotome and others. And we have one clinical support lady so the team is very focused, four of them. And as soon as we will get the FDA, we have a plan, of course, to increase them in order to support the growth that we are planning based on the approved indication.

Anthony Vendetti, Maxim Group.

Yes. So I just -- Eyal, just wondering if you could just give a little more color. The FDA seems to be taking their time. I'm wondering if that's just because it's such a -- it's a new application? Or is there anything that you can elaborate on in terms of staffing over at the FDA or your conversations with them?

And then a follow-up to that is, have you delayed any sales hiring? Or are you still moving forward with the expectation that this isn't that far off?

Thank you, Anthony. So I think that it's a combination that everyone heard and we saw in some of even the big players' early reports that they are facing some delay due to the evolving situation with the FDA, which, of course, affected to some way on a different team in the FDA. And due -- again, due to the really important of this indication to the health public and to the medical community, many stakeholders of the FDA is part of it.

I think that one of the teams that really affected by the President Trump administration decision and efficiency is the team that's mainly dealing with the post-marketing study but we have a continuous discussion and we are fully engaged, like the core team of the FDA, they are bringing the rest of the team in order to fast forward for a decision and we all believe that we will get the clearance of that.

Okay. But in terms of timing, it's hard to say other than, obviously, it's not going to happen before the end of March. But in terms of how soon in, let's say, the second quarter, it's -- is it too difficult to say at this point?

Yes. We cannot point on a specific date as of now, but we have a continuous discussion full engagement from our side, from their side in order to finalize it.

Okay. And then just in terms of Japan, can you provide an update on the timing of your expectation for submitting a regulatory filing in Japan?

Yes. I think that as we published and announced Terumo Corporation, our partner in Japan is planning to do the submission on the second semester of this year.

(Operator Instructions) Yi Chen, H.C. Wainwright.

This is [Eduardo] on for Yi. I had a question regarding XSense and how you kind of envision that dynamic playing out in the presence of ProSense as that gets approved in a couple of jurisdictions. Do you see it as a direct competitor? Do you see it kind of targeting different markets or users?

Thank you very much. The first market, as I mentioned earlier, we got the FDA clearance on the XSense. We are planning to do a soft launching early next year for the long run, this will be the product in the future, which will upgrade and replace. ProSense is our current flagship product, we are planning to do a submission in other markets and under the MDR, so this is our future platform technology, which in some point will upgrade and will replace the ProSense, but we have the system in order to fulfill all the market mix. This is our next generation.

I see. I see. So I guess I'm curious, so the ProSense, if it's approved this year, would you imagine it kind of only operating -- generating revenue for 2025 and then a slow transition towards XSense in the future?

The ProSense is approved product now globally. Now we are seeking in the US to get the specific indication of treating low-risk early-stage breast cancer, which we are treating breast tumors even last year or the year before, the ProSense is the flagship product that creates all the sales globally and in the US. We will start in 2026 with a soft launching in the US, and we will continue after we will get all the regulatory approvals in other markets, but it will not stop any sales.

(Operator Instructions) There are no further questions at this time. I will now turn the call back to Eyal Shamir for a concluding statement. Eyal, please go ahead.

Thanks for participating on today's call. We look forward to the FDA decision on marketing authorization of ProSense in early-stage breast cancer. Other potential catalysts this year include interim data from our ICESECRET Kidney Cancer study, Terumo application for approval of ProSense in Japan for breast cancer, regulatory approval for ProSense in China as well as more data from third-party studies of ProSense. Have a good day, everyone.

Thank you. This concludes the IceCure 2024 year-end results conference call. Thank you for your participation. You may go ahead and disconnect.