IceCure Medical, the developer of minimally invasive cryoablation technology, has reported a 20% year-over-year sales growth for its ProSense system and disposable probes in the financial results for the six months ended June 30, 2024. Despite CEO Eyal Shamir's absence due to communication issues, the VP of North American Sales, Shad Good, provided a positive update during the conference call. The company expects significant regulatory events in the near future, including an interim analysis of the ICESECRET kidney cancer trial and an FDA advisory panel meeting for ProSense's use in early-stage breast cancer. With a consistent gross profit of 46% and a narrowed net loss of $6.7 million, IceCure is optimistic about the potential of its technology in the US and Japan through its partnership with Terumo.
Key Takeaways
- IceCure Medical reported a 20% increase in sales of ProSense systems and disposable probes.
- Gross profit remained stable at 46%, and net loss improved to $6.7 million.
- An interim analysis of the ICESECRET kidney cancer trial is anticipated in December.
- An FDA advisory panel for ProSense in early-stage breast cancer is expected in early 2025.
- The company has cash and cash equivalents of approximately $10.5 million as of July 31, 2024.
- IceCure raised $5.035 million in gross proceeds from the sale of ordinary shares in the first half of 2024.
- Upcoming investment conferences in New York will include IceCure's participation in September.
Company Outlook
- IceCure is preparing for major catalysts, including an FDA advisory panel in Q4 2024 and an FDA marketing clearance decision in Q1 2025.
- The company is focusing on breast cancer treatment in the US and is working towards approval in Japan with Terumo.
- Independent studies on breast cancer and other indications are ongoing, with more data expected in the rest of 2024 and early 2025.
Bearish Highlights
- CEO Eyal Shamir was unable to participate in the earnings call due to communication issues.
- Net loss, although narrowed, was reported at $6.7 million.
Bullish Highlights
- Sales growth of 20% demonstrates increased demand for IceCure's products.
- The company is optimistic about the potential of its cryoablation technology, with key opinion leaders choosing their systems for studies.
- IceCure is actively participating in investment conferences, indicating a proactive approach to investor relations.
Misses
- There are no specific misses reported from the earnings call.
Q&A Highlights
- IceCure will issue a press release with details once the date for the FDA advisory committee meeting is announced.
- The advisory committee is expected to include a diverse panel of experts, such as breast surgeons, breast radiologists, oncologists, and regulatory experts.
- Additional clinical data will support IceCure's efforts during the FDA advisory committee meeting.
IceCure Medical, trading under the ticker symbol (specific ticker not provided), continues to make strides in its sector with promising developments on the horizon. The company's focus on breast cancer treatment in the US, along with its international ambitions in Japan, positions it for potential growth pending regulatory approvals. IceCure's participation in upcoming investment conferences in New York this September will further provide opportunities to engage with investors and stakeholders. The medical community and investors alike await further updates, particularly regarding independent studies and the anticipated FDA advisory panel meeting.
InvestingPro Insights
IceCure Medical (ICCM) has demonstrated resilience with a 20% year-over-year sales growth, as noted in the article. To complement this narrative, it's worth highlighting some key financial metrics and expert insights from InvestingPro that could influence investors' perspectives.
InvestingPro Data shows that IceCure Medical has a market capitalization of $30.61 million, indicating its size within the medical device sector. Despite the company's recent sales growth, it has a negative Price to Earnings (P/E) ratio of -2.42, reflecting that it is not currently generating net income. This aligns with the adjusted Operating Income Margin, which stands at a significant negative of -468.09% for the last twelve months as of Q1 2024, reiterating the company's challenges in achieving profitability.
On the optimistic side, the Gross Profit Margin is recorded at 38.29%, which is consistent with the company's reported stable gross profit of 46% in the article. This suggests that while IceCure is facing bottom-line pressures, it is maintaining a relatively healthy margin on its products.
InvestingPro Tips for IceCure Medical reveal that analysts are anticipating sales growth in the current year, which could be a signal for potential investors looking for growth opportunities. However, it's also noted that the company is quickly burning through cash and is not expected to be profitable this year. This information could be crucial for investors considering the risks associated with the company's cash flow and profitability outlook.
For those interested in delving deeper into the company's financial health and future prospects, there are additional InvestingPro Tips available at https://www.investing.com/pro/ICCM. For instance, the platform lists that IceCure holds more cash than debt on its balance sheet, which is a positive indicator of financial stability, and that liquid assets exceed short-term obligations, suggesting the company has a cushion for its near-term financial commitments. These insights can be particularly valuable given the company's upcoming regulatory events and anticipated FDA advisory panel meeting.
Investors may find it beneficial to consider both the opportunities and challenges presented by IceCure Medical's financial situation as they assess the company's potential in the evolving medical device market.
Full transcript - Icecure Medical Ltd (NASDAQ:ICCM) Q2 2024:
Operator: Good morning, and thank you for standing by. Currently, all participants are in a listen-only mode. After management's discussion, there will be a question-and-answer session. Please be advised that today's conference will be recorded. I would now like to turn the conference over to Michael Polyviou. Please go ahead.
Michael Polyviou: Thank you, Joni, and welcome to IceCure Medical's conference call to review the financial results as of and for the six months ended June 30, 2024, and provide an update on recent operational highlights. You may refer to the earnings release that we issued earlier this morning. Eyal Shamir, the company's CEO, is traveling and due to a last minute poor communication network in his location, is unable to dial in and participate Therefore, joining today are IceCure Medical's VP of North American Sales, Shad Good; and the company's CFO and COO, Ronen Tsimerman. Before we begin, I'll now take a moment to read the statement about forward-looking statements. The call and the question-and-answer session that follows that 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 upcoming regulatory review process by the FDA in its medical device advisory panel, the expected time line for reporting interim analysis of ICESECRET kidney cancer trail, in the pursuit of regulatory approvals in various jurisdictions, including with respect to reimbursement codes for physician expenses and potential demand for a market adoption of IceCure's minimal invasive cryoablation technology, advancing the regulatory marketing and commercial strategies in our belief that we have resources to execute our clinical, regulatory and commercial objectives till the end of 2024 and into 2025. Because such statements yield 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, 2023, filed with the SEC on April 3, 2024, which is available on the SEC's website at 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, August 20, 2024. 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 VP of North American Sales. Shad Good. Shad, please go ahead.
Shad Good: Thanks, Michael. Hello, everyone, and thank you for joining us today. As Michael mentioned, Eyal is unable to get on the call due to last minute network difficulties, so I will provide his business overview. During the first half of 2024, we continued to experience increased demand for ProSense as evidenced in the 20% year-over-year sales growth for ProSense systems and disposable probes sales as reported in our press release earlier today. While the growth is a positive indicator, we believe the level of enthusiasm, physician engagement and conversations at medical conferences specific to breast cancer and other indications along with upcoming catalysts over the rest of 2024 and early 2025 may have magnitude of greater positive impact on IceCure. Moreover, in December, we anticipate reporting an interim analysis of ICESECRET kidney cancer trial. During the second quarter, the FDA informed us that it will convene a public medical device advisory panel. Later this year to obtain independent expert advice on scientific, technical and policy matters related to ProSense to help the FDA make a sound decision on regulatory approvals of ProSense in the early stage breast cancer. It's important to note that the current standard of care lumpectomy is a surgical procedure and it's not regulated by the FDA. We believe the FDA's decision to convene the advisory panel demonstrates the extreme public health importance and specifically women's health importance of making a minimally invasive alternative to surgery available for women with early-stage low-risk breast cancer in the United States. As a reminder, ProSense is already available and approved to treat breast cancer and other global jurisdictions, and our objective is to ensure women in the US have the same access to the same care and realize similar benefits. Our team received numerous calls from women in the US and around the world who have recently been diagnosed with breast cancer, and they often ask for the nearest physician or hospital that uses ProSense. They are willing to travel, and in many instances, travel by plane, because they have -- because they want to have the choice of a minimally-invasive treatment to avoid surgical excision. The wealth of evidence that has accumulated, including our ICE3 study and the growing number of independent studies, we believe, make the advantage of ProSense, crystal clear for people participating in and watching the advisory panel discussion. The data from our study and a third-party investigator-initiated studies have been consistently and overwhelmingly positive. In fact, we believe that the transparent and public forum will raise awareness of ProSense as a nonsurgical option and therefore support its rapid adoption in the United States, should the advisory panel recommend marketing authorization followed by FDA granting such authorization. Our US commercial sales team is prepared for the initial push. As a reminder, a reimbursement code for facility expense of $3,600 is already in place with more reimbursement, including the physician expense expected to be applied for following marketing authorization. In our ICE3 study, the patient and doctor satisfaction rates were both 100%. Per the analysis at a five-year follow-up evaluation, 96.3% of the subgroup of patients treated with ProSense cryoablation, followed by hormone therapy were estimated to be free from local recurrence. This recurrence rate is similar -- is very similar to that of surgery, the current standard of care. We are confident that there will be a strong demand for cryoablation to treat early-stage low-risk breast cancer. In Europe, we continue to see excellent clinical results from independent studies investigating cryoablation of breast cancer among varying patient populations, including a more advanced and metastatic breast cancer, and publications such as the British Journal of Radiology and the highly influential Medical Journal of Cancer. Promising clinical results were presented at a 32nd Annual Meeting of the Japanese Breast Cancer Society with the demand of minimally invasive breast cancer treatment with an overarching theme. Our team attended, and we were very pleased with the high level of interest in ProSense. Terumo, our distribution partner in Japan and also the largest medical device company in that country, plans to file for regulatory approval of ProSense's early-stage low-risk breast cancer with endocrine therapy in the first quarter of 2025. All of this data, as well as the data from clinical cases conducted from around the world, will be submitted to the FDA advisory committee panel. We believe that it will be a very positive factor in the panel's decision making process. We believe our activities over the next several months will enhance our performance post FDA clearance. We are planning to be very visible at numerous medical conferences in the United States and in Europe, where we will be engaging with our target audience, including interventional radiologists, breast radiologists and breast surgeons. Now I'm going to turn it over to Ronen to go over the numbers. Thank you.
Ronen Tsimerman: Thank you, Shad. As Shad mentioned earlier, growth momentum continues for ProSense console and disposable cryoprobe sales. For the six months ended June 30, 2024, ProSense systems and disposable probes sales increased by 20% to $1.65 million compared to $1.37 million for the six months ended June 30, 2023. Driven primarily by higher sales in Europe, the US, Japan and other territories in Asia, partly offset by a decrease in sales in China. Total revenues, when including revenue recognition and other services from our Terumo agreement in Japan grew by 6.5% to $1.75 million for the six months ended June 30, 2024, as compared to $1.65 million for the six months ended June 30, 2023, due to the increase in the sales of ProSense systems and disposable which was partially offset by a decrease in revenue recognition and other services in Japan of $100,000 and $274,000 in the first six months of 2024 and 2023, respectively. Gross profit for the six months ended June 30, 2024, grew by $799,000, compared to $754,000 for the six months ended June 30, 2023. Gross margin remained consistent at 46% for the six months ended June 30, 2024, and the six months ended June 30, 2023. Non-GAAP gross profit, which represents gross profit from sales of our products, not including revenue recognition for distribution agreements, increased by 46% for the six months ended June 30 2024 to $699,000 compared to $480,000 for the six months ended June 30, 2023. The non-GAAP gross margin for the six months ended June 30, 2024, grew to 42% from 35% for the six months ended June 30, 2023. Reconciliation of these non-GAAP figures are included in the earnings press release that we issued earlier today. Total operating expenses for the six months ended June 30, 2024, decreased to $7.68 million compared to $8.8 million for the six months ended June 30, 2023. The decrease is attributable mostly to a reduction in research and development and general and administrative expenses. Net loss narrowed during the six months ended June 30, 2024, to $6.7 million or $0.14 per share compared to a net loss of $7.66 million or $0.17 per share for the same period last year. As of June 30, 2024, the company had cash and cash equivalents of approximately $10.5 million and as of July 31, 2024, the company had cash and cash equivalents of approximately $10.3 million. During the first half of 2024, we raised $5.035 million in gross proceeds from the sales of ordinary shares under our ATM facility. The prudent management of cash has positioned us to execute major upcoming catalysts in the coming quarters including the FDA advisory panel expected in Q4 2024 and the FDA subsequent marketing clearance decision anticipated in the first quarter of 2025. Finally, I'd like to note that Eyal will be participating at the H.C. Wainwright's Annual Global Investment Conference being held in New York from September 9 to 11. Additionally, Eyal will be participating at Lake Street's Annual Best Ideas Growth Conference also being held in New York on September 12, to provide an overview of the IceCure story and educate investors about the opportunities we are addressing with our novel ProSense technology. Operator, we will now open the call for Q&A.
Operator: [Operator Instructions] The first question is from Anthony Vendetti of Maxim Group. Please go ahead.
Anthony Vendetti: Thank you. Ronen, I was just wondering the pipeline, I know you have a sales force ready to go. If the advisory committee recommends that you get approval by the FDA in early 2025, can you just outline the planned rollout? Are you starting out with KOLs, physicians you're working with? And then how do you -- what's the commercialization plan beyond the KOLs in 2025?
Ronen Tsimerman: So thank you, Anthony, for joining us for the questions, and I will refer to Shad.
Shad Good: Yeah, hi, Anthony, hopefully, you can hear me okay. Yes post -- assuming we receive FDA approval authorization, we have a very detailed plan really kind of a strategy that we've developed for the next five years. And it's a combination of targeting -- or working with certain societies, KOL development, but also just key roles that we need to put into place here in the US to support the growth that we expect.
Anthony Vendetti: And then in Japan, I know you're working with Terumo. Can you talk about the plan there? And the expectations there?
Ronen Tsimerman: Yes. Yes, Anthony. So we are expecting that Terumo will file the request for PMDA approval in early 2025, in the first quarter. Of course, some of it will be based also on the ICE3 trial data that they have with them. So we're working very closely with them, our regulatory team with their regulatory and with KOLs over there in Japan.
Anthony Vendetti: Okay, great. Thanks so much. I’ll hop back in the queue. Appreciate it.
Operator: The next question is from Kemp Dolliver of Brookline Capital Markets. Please go ahead.
Kemp Dolliver: Great. Thank you. First, with regard to the first half, China was zero in the first half. And I'm curious why if this is just a matter of the Shanghai Medtronic (NYSE:MDT) working through the inventory or just other factors behind the performance year-to-date?
Ronen Tsimerman: So, thank you, Kemp. China is a little bit different than other territories, and this has its own complications. So -- and sometimes, the sales are in 1 quarter, sometimes they are in different quarters. We can't really give any guidance regarding China. But we're optimistic, and we believe that we will be able to serve in China in the next quarters in the future.
Kemp Dolliver: Okay. Thank you. The next question relates to the ICESECRET data and your plans and ability to leverage that data in the US in particular?
Ronen Tsimerman: So currently, Kemp, we're focusing in the US mostly on breast and at least in the next year, this is what we're planning to focus on, but we're definitely utilizing this data for other territories in Europe, in Southeast Asia and also in South America. So it will definitely assist us.
Kemp Dolliver: Okay, great. Thank you.
Ronen Tsimerman: Thank you.
Operator: The next question is from Ben Haynor of Lake Street. Please go ahead.
Ben Haynor: Good day, gentlemen. Thank you for taking the questions. First one for me, just looking at some of these independent breast cancer studies, they are for slightly different patient populations and actually, it seems like in several cases, patients that are less well off than the ICE3 cohort was. Just kind of curious if you guys have any commentary on that? And what should investors take away from the potential for a broader applicability of ProSense?
Ronen Tsimerman: Hi, Ben, and again, thank you for joining. So I think the most important thing is to understand that KOLs see the potential in our cryoablation activity and they choose their own set of group in order to do independent studies. We look at it as a very good thing from our side. And we can see that the data is also very consistent and showing great promise. So we do encourage physicians to do their own studies and of course, we can see all the papers and all the abstracts, which are -- which provides us with very important data for our next steps.
Ben Haynor: Makes sense. That's helpful. And then maybe this is an unfair question. But I think you mentioned in the press release there is something like 15 ongoing independent studies being performed out there. Are there any specifically that you highlight for investors to take a look at? And I know it might not be necessarily your domain and with Eyal not on the call, but just curious if there are any that folks are paying attention to or should be?
Ronen Tsimerman: So most of the studies are for breast, mostly breast cancer, if I remember correctly, about eight of the 15 are breast cancer. And again, we are very optimistic regarding the studies. And we're happy that so many KOLs are choosing our systems in order to do the independent studies. We can't really provide more data than this because, again, it's an independent study we are not the sponsors. We do not decide when to submit a paper or when to submit an abstract to one of the conferences. But as soon as we have the data as soon as we see it, we, of course, release it to everyone. And, of course, as soon as the students themselves present it.
Ben Haynor: Got it. That’s all I had. Congrats on the progress gentlemen, and good luck at the advisory committee.
Ronen Tsimerman: Thank you very much.
Operator: The next question is from Yi Chen of H.C. Wainwright. Please go ahead.
Yi Chen: Thank you for taking my question. Would you be able to comment on whether the advisory committee meeting will take place in, kind of, early fourth quarter or towards the end of the year. And do you know how many members will be in the Ad Comm committee and whether they will only review material submitted to the FDA?
Ronen Tsimerman: Okay. Thank you, Yi. Thank you for joining and thank you for the questions. I'll refer the question to Shad.
Shad Good: Yeah. I'll have to have you repeat the second part of the question. But to answer your first part of the question, we expect to receive the date for the meeting shortly. And once we receive that notification, we'll issue a press release announcing the details. Also, the FDA will make the meeting available and we'll provide a webcast link for the event. And can you repeat the second part of the question?
Yi Chen: How many members will be in the Ad Comm committee and whether they will only review material submitted to the FDA?
Shad Good: So we're expecting -- right now, we don't know the exact number of -- we don't know exactly who the members will be on the committee yet, but we're expecting breast surgeons, breast radiologist, oncologists and also regulatory experts as well to participate in this event on behalf of the FDA. And a lot of the additional clinical data that's out there will be used to help support our efforts in that event.
Yi Chen: Okay. All right, thank you.
Operator: [Operator Instructions] There are no further questions at this time. I will now turn the call over to Ronen Tsimerman for his concluding statement. Please go ahead.
Ronen Tsimerman: So we want to thank everyone for participating on today's call. We have achieved our goals through the first half of 2024, and for the remainder of 2024 and into early '25, we expect more data from independent studies on breast cancer and other indication. As soon as we have the details on the date and the public link for the participation in the FDA advisory panel, we will share those with you through a press release. Thank you, everyone, for participating in our call today.
Operator: Thank you. This concludes the IceCure second quarter 2024 results conference call. Thank you for your participation. You may go ahead and disconnect.
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