Procept BioRobotics at 45th Annual William Blair Growth Stock Conference: Aquablation Advances

On Wednesday, 04 June 2025, Procept BioRobotics (NASDAQ:PRCT) presented at the 45th Annual William Blair Growth Stock Conference. The company highlighted its innovative aquablation therapy, aimed at addressing the significant unmet needs in Benign Prostatic Hyperplasia (BPH) treatment. While the firm reported robust financial growth, it also faces challenges in expanding its market share and convincing urologists to adopt its technology.

Key Takeaways

• Procept BioRobotics reported a 55% year-over-year revenue increase in the first quarter, reaching $69.2 million.
• The company’s HydroS robotic system aims to streamline procedures with AI-powered planning and advanced image guidance.
• The transition from a Category III to a Category I code for aquablation is expected to enhance pre-authorization processes.
• Procept is investing in clinical research to explore aquablation’s application in prostate cancer treatment.
• The firm aims to address market expansion hurdles, including surgeon retention and reimbursement processes.

Financial Results

• First-quarter revenue reached $69.2 million, a 55% year-over-year growth.
• Procept placed 43 new systems in the U.S., increasing the total installed base to 547.
• International revenue surged over 100%, driven by strong performance in the UK and Japan.
• The company reaffirmed its 2025 revenue guidance of $323 million.
• Facility payment for aquablation stands at just over $9,200.

Operational Updates

• The HydroS robotic system, launched in late Q3 of the previous year, features AI-powered treatment planning and advanced image guidance.
• Over 30,000 aquablation cases were performed in the U.S. last year, indicating rapid adoption.
• Aquablation enjoys full Medicare coverage and is covered by almost all private payers, reaching about 95% of eligible patients.
• The water jet resection has been approved to move from a Category III to a Category I code.

Future Outlook

• Procept is actively investing in clinical studies to evaluate aquablation for localized prostate cancer treatment.
• The Waterford study, the first FDA randomized study against prostatectomy, has begun enrollment with 280 patients.
• The Category I code transition is anticipated to be finalized later this year and effective from January 2026, with no impact on facility payment.
• The company seeks to expand its market to patients hesitant about traditional prostate cancer treatments due to side effects.

Q&A Highlights

• Procept aims to standardize robotic procedures with the HydroS system, focusing on clinical outcomes and efficiency.
• The company is gaining market share from traditional TURP and Greenlight procedures for BPH.
• Key hurdles include surgeon retention, clinical outcomes, and removing reimbursement obstacles.
• The Category I code is expected to streamline pre-authorization without affecting facility payments.

Readers are encouraged to refer to the full transcript for a detailed account of the conference call.

Full transcript - 45th Annual William Blair Growth Stock Conference:

Brandon Vasquez, Analyst, William Blair: Hello? Sorry. Hi, everyone. My name is Brandon Vasquez. I am the analyst here at William Blair that covers Procept biorobotics.

I am required to tell you and inform you to go to our website at williamblair.com a complete list of disclosures and conflicts of interests. With that said, happy to have president and CEO Reza Zadno with us. He’s gonna run us through a company presentation before we go to our breakout. So with that, I’ll turn it over to Reza.

Reza Zadno, President and CEO, Procept BioRobotics: Yeah. Thanks, Brandon. Good morning, everyone. Very excited to be here and talk about our company, Reza Zadno, President and CEO at Procept. We are a surgical robotic company with the vision to become a global leader in urology.

These slides advance. Okay. Please review our safe harbor statement, use of non GAAP financial information. So BPH is enlargement of prostate that presses on urethra and ultimately results in various symptoms, urinary symptoms. And it’s the number one reason men see a urologist.

It’s a significant man’s health in The US and international. One in two men above the age of between 50 and 60 suffer from this condition. In fact, this incident increases for men between 60 and 70 and 70 and 80. 90 nine percent of men with BPH complain about the impact of this disease on their quality of life. In The United States, there are forty million men suffering from BPH and I will get more into detail of the population, and the population of men above 65 years old is anticipated to increase double by 2030 I’m sorry, by 02/1960, and that would increase the number of men with BPH.

This is a large market, unmet clinical need. Twelve million of those forty million are under medical management. As you can see, vast majority of them start with medications, six point seven million men are using medication, three point eight million washable waiters in fact, they sit on the sidelines, one point one million have failed the medication and in 2019, about 400,000 procedures were conducted, three hundred thousand of them roughly were receptive and one hundred thousand of them were nonresective. And the reason, one of the biggest reasons that vast majority of men sit on the sidelines and avoid surgical is the side effects of these care and treatments, and I will get into more detail about that. Acrobulation was designed to address this unmet clinical need, which is a treatment that can be used on all prostate sizes and all prostate shapes.

As you can see, prostate come in sizes anywhere from below 30 grams all the way above 150 grams, a different shape and current treatment, whether it is resective or non resective, work for either small prostate or large prostate. There is no treatment that would work for all prostate sizes and patients prioritize. If they are interested in efficacy, they select resective procedure, but the disadvantage of resective procedure is the side effects, incontinence and sexual dysfunction. And if they want to prioritize sexual function and safety, they go for non resective procedure. What aquablation was designed is the procedure that works on all these prosthesis sizes and shape and provide safety and efficacy.

The information on safety for resective procedure, this is published data on resective procedures. As you can see, for smaller prostate, TURP and PVP are conducted for prostate below 80 gram. These side effects, incontinence, erectile dysfunction, for small prostate incontinence in the two percent range, erectile dysfunction in the high single digits, and ejaculatory dysfunction way above fifty percent. And for larger prostate, these ejaculatory dysfunction numbers are even larger for these larger prostates. And incontinence for these larger prostate with current treatment is anywhere between eight percent to thirty three percent.

In contrast to that, in the randomized study, I will get in more detail, when in water, acrobulation was compared to TURP, incontinence and erectile dysfunction with zero percent for small prostate and similar numbers were obtained when this was used on larger prostate in the water two study and open water which was for prostate anywhere between 27 gram to two fifty two gram. Similar results were obtained for these larger prostates. Multiple factors position aquablation therapy to become the BPH standard of care and that starts with the technology, which is an automated water jet, not using heat. When you this is to avoid unnecessary damage to surrounding tissue and visualization with ultrasound. Efficacy is supported by compelling clinical data.

I will get into FDA trial results, and there is market access reimbursement. I will talk about it. Full Medicare coverage for patients and many private payers covering 95 of the target patients have access to this therapy. And the combination of well defined customer base and sales experienced sales force enable us to increase adoption and utilization of our system with last quarter, we announced with more than five forty installed base in The United States. Within a few years of launch of our first generation AquaBeam, we launched HYDRO’s robotic system, which is the next generation system for coagulation therapy with AI powered treatment planning, advanced image guidance, robotic resection and streamlined workflow, which allows the setup time and start up the procedure faster than the first generation Aquabeam.

This was launched in the end of last third quarter of last year. The safety and efficacy of aquablation have been studied in multiple clinical studies. The first one was water, which was one hundred and eighty one patients, a randomized study between an FDA randomized study first and only against TURP in The United States that shows superior safety outcomes on all prostate size, But even with a subset of sizes above fifty milligrams showed better even efficacy, which TURP is a standard of care for efficacy for in receptive markets. Even in some subset of those sizes, there were better efficacy results. For larger prostate than between eighty and one hundred and fifty milligram, it was a single arm multicenter study and showed similar outcomes for larger prostate and recently in a water three that was presented at EAU, this was a randomized study for prostate between eighty and one hundred and eighty milligram.

This was three study comparing at population against enucleation showed similar symptom relief efficacy and enucleation, but zero percent transfusion and significantly lower side effects than enucleation. So as you can see, this technology anywhere from thirty gram to one hundred and eighty gram, the safety and efficacy supported by these clinical studies. And these have resulted in multiple publications. Thanks to the robotic execution, this is a very predictable and consistent outcomes provided to the patients and because of this predictability and consistency, many hospitals are standardizing the procedure. In this graph, what we are showing is the resection time of TURP that was during the FDA trial, the graph on top.

These are some of the top TURP surgeons who have done thousands of TURP. As you can imagine, there is a high scatter for the time of the resection for TURP versus in the FDA trial against TURP, fourteen out of seventeen of those surgeons, that was the first time they were using ACpopulation and yet you see how consistent their results were. And in the water too, which was the prostate between 8,150 gram, Majority of these doctors had less than one procedure of aquablation when they started this procedure. Because of this consistency, this makes the practice more efficient and more predictable when they perform aquablation therapy. And these outcomes are seen across all prostate sizes, so this is not just for small prostate or large prostate.

These are actual prostates that were treated with aquablation since January 2021 until the end of last quarter. As you can see, it’s a bell curve that simulates what actual men’s prostate sizes are. And as you can see, the top of the bell curve is 60 to 80 gram and majority of them, seventy percent, are below one hundred milligrams. So this is not done just for large prostate or small prostate. They are using them across all range of prostate sizes and shapes.

Acrobulation is covered on Medicare full Medicare coverage with almost all private payers, including United, Aetna, Cigna, Anthem, Humana and many more. That allows about ninety five percent of eligible patients who have access to this treatment. Just the information about fifty percent of the hospital based resective procedures are Medicare patients. Under coding, the water jet resection recently was approved to move to the Category one, and the facility payment for aquablation is just over $9,200 Changing gears to prostate cancer. We are very excited about the opportunity of using Agpopulation for the treatment of prostate cancer.

This is a massive opportunity, unmet clinical need. There are more than three million men in The United States with prostate cancer. The incidence are about three hundred thousand cases per year. The vast majority of these patients sit on the sidelines, and the reason for that is the side effects, incontinence and sexual dysfunction, erectile dysfunction, so they forgo treatment because of these side effects. To break down those three hundred thousand new cases, about two hundred and ten thousand of them are focal localized disease and the balance, the non localized.

And when you look at those localized, you break them down, about half of them are intermediate risk. The risk of prostate cancer are divided into great group one, two, three and above. So half of them are intermediate risk, and the other half of twenty five percent, twenty five percent in low risk and high risk. Again, this is a massive opportunity and the unmet clinical need here is a technology that provides treatment for these patients, but without the side effects of incontinence and sexual function. We have been actively investing in prostate cancer clinical research.

We started our journey for cancer, prostate cancer, was first to show that we are not spreading cancer. That was the first question that we had to answer. We started that a few years ago and ran clinical studies outside The United States and submitted all of that to the FDA because when we received FDA approval in 2017, cancer was a contraindication in patients who had BPH. So when we submitted that data, FDA removed cancer contraindication and then we started the first two studies, PRCD001 and PRCD002. PRCD001 are for grade group one, two and three.

These are patients who have BPH and cancer. NPRCD002 that enrollment is complete is 22 patients. These are grade group one and two. These are patients with prostate cancer that may or may not have BPH. At AUA, there was a surgeon panel discussion, Investor Day.

The purpose of that was to show that one, when we treat, when we cut a prostate that has cancer, we do not spread. There was a cancer specialist who talked about that, so that was the first information that was shared in that meeting. The second one was we can reach cancer lesions in the peripheral zone, that was also shown. The third one was cancer is a focal disease is not a focal disease, it’s a diffuse disease, a multifocal, that’s why you need to remove as much of prostate as you can without having the side effects of damaging the ejaculatory ducts. And the fourth one was the cavity that we create for cancer is very different.

It’s much larger because you need to remove maximum part of the prostate without those side effects. And the study that we started is Waterford, that’s the first and only FDA randomized study against the prostatectomy that has started the two eighty patient, three to one randomization on grade group one, two and three and that enrollment has started since January. On the financial, this is the recap of what we presented in the first quarter, ’60 ’9 point ’2 million, which was a growth of 55% year over year. And at the end of the first quarter, we had 43 new U. S.

Systems that brought us to about five forty seven U. S. Installed base. And we are very happy on the international side. We made good progress with 8,900,000.0 revenue.

That was 100 more than 100% year over year growth. Majority of that is from U. K. And Japan, and we are very happy with the progress that we are making on the international front. And we are on we have been on a very fast revenue growth with a guidance of $323,000,000 for 2025, ’60 ’3 percent to 64.5% and operating expense and adjusted EBITDA that we are presenting there.

And with that, I want to thank you for listening to our story. Thank you.

Brandon Vasquez, Analyst, William Blair: Great. Thank you, Reza. We have a couple minutes here, so maybe I’ll throw just some high level questions to you before we go out to the breakout session. What, you know, as you guys continue, you have a lot of great data, but part of what you want to do here is standardize. I think you’ve talked about this in the past before.

You want to standardize to robotics, to hydros and to aqua beam. Talk to us a little bit about what that means from a commercial perspective. I know you have some like Sham that came from Intuitive Surgical and you have that experience in standardizing to a platform. How do you achieve that now that you have the clinical data and the systems out there to do it?

Reza Zadno, President and CEO, Procept BioRobotics: So definitely everything starts with the clinical data that we have presented. Once hospitals purchase our system and they see that they can predict with the graph I showed, the resection time, when they see that these procedures are predictable, whether it was AquaBeam or our new system, HydroS, the predictability and clinical outcomes definitely clinical outcomes is very important to the surgeon, but for the practice that they can stack these cases and know how many cases per day they can do, And they do not need to have a specialist for large prostate, specialist for enucleation or same surgeon, any surgeon can do any prostate. This makes the practice more surgeon and the younger urologists who come on board and there was a in fact, I read the interview that you had done with surgeon they are very interested in newer technologies, robotics. So combination of efficiency, clinical outcome allows this to and many accounts have standardized this because they don’t need to know which doctor is today for which or what prostate size. So these are and with hydros, the setup time has become much easier because it’s integrated.

The footprint is smaller. All the initial connections of the ultrasound to the robot, those are already there. So the setup time is easier, makes the launch easier with hydros. These are all the factors that allow this, we believe, to gradually become we are still early in that journey, but we are seeing that in fact, when we talk to our accounts, many of them tell us that their BPH volumes have increased since in the last two years.

Brandon Vasquez, Analyst, William Blair: And you know, as you think about some of these accounts that have standardized, again, as background in this opening presentation first, what procedures are you mostly taking market share from and why do you see them often switching from those procedures specifically?

Reza Zadno, President and CEO, Procept BioRobotics: TURB still is the, I would say, standard of care in resective procedure. When we ask the question from surgeons if they didn’t do aqua ablation, what they would have done, a majority of them say they would have done a TURB or green light. So that is the one that we hear where it comes from. Of course, it’s hard to say patients who are on the sidelines because all of these patients, whether they want to do aquablation or TURP or other, they were on medication. They were all on medication.

But yes, there are patients who come in and ask for aquablation, so the awareness is increasing amongst patients, but majority of them are from TURP and Greenlight. For larger prostate, of course, there is only enucleation and prostate. For larger prostate, it’s obvious it’s prostatectomy and enucleation.

Brandon Vasquez, Analyst, William Blair: And you have a lot of good clinical data, you have reimbursement, you seem to check a lot of the boxes. What are the biggest hurdles that you guys are focused on on a daily basis to get that incremental procedure growth and the incremental urologist trained? Talk to us about what is left in terms of an execution standpoint now that the technology and the data is there.

Reza Zadno, President and CEO, Procept BioRobotics: Yeah. So from the initial launch of this product, for us it was very important to focus on definitely we have to place the robot, but surgeon retention was very important. It wasn’t just about increasing the procedure. Surgeon retention, clinical outcomes and net promoter score were very important to us. So those are the factors we have been focusing on initially rather than increasing.

We are very happy with the progress we have made with the more than thirty thousand cases in The U. S. Last year. There’s been rapid growth. So initially when you go in a high volume center, in a high volume center, there could be up to twelve, fourteen surgeons.

So initially you start with the top two or three surgeons who do majority of those, let’s call it two hundred plus cases a year, you start with those and with time you expand into these other surgeons who do less than two or one per month, whether it is a coagulation or other procedures. But also as we improve when the reimbursement came, there was limitation although FDA, there was no limitation on prostate size, but some of the payers had limitations on the way you measure prostate, on the patient on retention or for large prostate. So as those obstacles are removed, this utilization will increase and the focus on these other surgeons in an account.

Brandon Vasquez, Analyst, William Blair: And since you were touching on reimbursement side there a little bit, ninety five percent of lives covered, but a question I often get is what are the milestones here as you transition from Category III code to a Category I code? What are the steps from here for us to keep an eye out over the next six plus months, something like that?

Reza Zadno, President and CEO, Procept BioRobotics: Yes, so initially, like any other procedure, when you come in, you have a temporary code and the good news is when we ran the FDA trial, the total time of the procedure at the time was measured during the procedure. It was equivalent to TURP. So during the Category III, it was paid similar to TURB, similar to other resective procedure. The advantage of moving to Category I is some payers still you need to get to preauthorization because by definition is a temporary code. So moving to Category one brings the advantage of this this is a permanent code, this pre authorization goes away.

The second point to make is moving from Category III to Category I has no implication on the facility payment. The facility payment is separate, and that was, as I mentioned, is just over $9,200 So we expect the payment for the physicians to be in line with other resective procedure, and that will be coming out in July.

Brandon Vasquez, Analyst, William Blair: Okay. So we’ll get the proposed in July. That will be finalized later in the year. I believe it’s usually around November. CMS loves to drop it on our holiday so we can talk about it.

Reza Zadno, President and CEO, Procept BioRobotics: Becomes effective from January of twenty twenty six.

Brandon Vasquez, Analyst, William Blair: Okay.

Reza Zadno, President and CEO, Procept BioRobotics: But we don’t expect this to be meaningfully different than other resective procedure. They are looking at all these resective procedure at the same time.

Brandon Vasquez, Analyst, William Blair: Okay. Maybe the last one here in this setting before we go to the breakout session. At a high level, like the logic makes a as we know in medicine just because it logically high level makes sense that doesn’t always mean it’s right. What are the things that you think need to be left to or need to be proven still within this space to start to convince the mass urologists that this is a good option, if not one of the best options for these prostate cancer patients?

Reza Zadno, President and CEO, Procept BioRobotics: I think clinical data. I think clinical data, that’s why we had to do these feasibility studies so that we were comfortable with the protocol. We have similar to BPH, we always lead with clinicals, these randomized studies whether we did BPH and here, and partnering with specialists, I mean, at AUA, you saw some of them, the KOLs in prostate cancer treatment. So we believe as we generate clinical data, as we show that this is possible to resect in the peripheral zone and hopefully have similar safety profile because it’s the same same anatomy, same doctor, same procedure. It’s just the treatment planning is different.

We believe if we can replicate the safety profile of our BPH patient in cancer and show efficacy because this will be definitely removing way more tissue than focal therapy would do, but not as big as what prostatectomy does. But the disadvantage of prostatectomy is you have these other side effects. I believe if we can replicate this, our goal is to expand this market to those patients who are sitting on the sidelines to have an option that they can use our treatment.

Brandon Vasquez, Analyst, William Blair: All right, great. Well, I’ll finish this a couple minutes early. Maybe some of us can read or beat the rest of the elevator and we’ll meet up stairs in Room Jenny A for breakout with Prosep. Thanks, everyone. Thank you.

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