ClearPoint Neuro Inc.

Greetings and welcome to the ClearPoint Neuro, Inc. First Quarter 2024 Financial Results Conference Call. At this time, all participants are in a listen-only mode. A brief question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. Comments made on this call may include statements that are forward-looking within the meaning of securities laws. These forward-looking statements may include, without limitation, statements related to anticipated industry trends, the company's plans, prospects, and strategies, both preliminary and projected, the size of total addressable markets, or the market opportunity for the company's products and services, and management's expectations, beliefs, estimates, or projections regarding future revenue, results of operations, or the adequacy of CAS, and cash equivalent balances to support operations and meet future obligations. Actual results or trends could differ materially. The company undertakes no obligation to revise forward-looking statements for new information or future events. For more information, please refer to the company's annual report on Form 10-K for the year ended December 31, 2023, which has been filed with the Securities and Exchange Commission in the company's quarterly report on Form 10-Q for the three months ended March 31st, 2024, which the company intends to file within the Securities and Exchange Commission on or before May 15th, 2024. All the company's filings may be obtained from the SEC or the company's website at www.clearpointneuro.com. It is now my pleasure to introduce your host, Joe Burnett, Chief Executive Officer. Thank you, Joe. You may begin.

Thank you. And thank you to all of the investors and analysts on today's call for being a part of the ClearPoint vision and journey. Our mission and our priority is to help restore quality of life to patients and their families who are suffering from some of the most debilitating neurological disorders imaginable. In the first quarter of 2024, we have continued to make progress across our four pillar growth strategy, including biologics and drug delivery, functional neurosurgery navigation, therapy and access products, and in achieving global scale. In 2024, we expect meaningful contributions from not just one, but from all four of these growth pillars as we launch new products and services throughout the year. These new products will allow us to expand into the operating room, expand into laser therapy, expand internationally, and expand into more comprehensive preclinical and clinical trial services as many of our biologics and drug delivery partners progress through the regulatory process and begin first in human clinical trials for their therapies. I will now turn the call over to Danilo, our CFO, to review our financial performance in the quarter, after which I will add some detail to our four-pillar growth strategy. Danilo?

Thank you, Joe, and thank you all for joining us today. Looking at the first quarter of 2024 results, Total revenue was $7.6 million for the three months ended March 31st, 2024, and $5.4 million for the three months ended March 31st, 2023, which represents 41% growth versus the first quarter of 2023. Our revenue is made up of three components, biologics and drug delivery, functional neurosurgery navigation and therapy, and capital equipment and software. Biologics and drug delivery revenue include sales of disposable products and services related to customer-sponsored preclinical and clinical trials utilizing our products. Biologics and drug delivery revenue increased 61% to 4.3 million in the first quarter, up from 2.7 million in 2023. This increase was fueled by our expanded biologics and drug delivery offering. Functional neurosurgery navigation therapy revenue consists of commercial sales of disposable products and services related to cases utilizing the ClearPoint system to deliver medical device therapy to the proper target and the ClearPoint NeuroPrism laser applicators. This revenue segment declined 18% to 1.9 million for the first quarter of 2024. The decline in this segment was fully due to lower service revenue of 0.5 million. Capital equipment and software revenue consisting of sales of ClearPoint reusable hardware and software and of related services increased 255% to $1.4 million in the quarter. from $0.4 million for the same period in 2023, as a result of multiple placements of ClearPoint Capital and Software and ClearPoint NeuroPrism Laser Systems. Gross margin for the first quarter of 2024 was 59%, in line with gross margin of 59% for the three months ended March 31st, 2023. Research and development costs were $2.6 million for the three months ended March 31st, 2024, compared to $3 million for the same period in 2023, a decrease of $0.4 million or 13%. In line with prior quarters, the decrease was due primarily to lower product development costs as a result of reprioritization of certain research and development initiatives. Sales and marketing expenses were $3.3 million for the first quarter of 2024, compared to $2.9 million for the same period in 2023, an increase of $0.4 million or 12%. This increase was due primarily to additional personnel costs, including share-based compensation, resulting from increases in headcount as well as increases in travel costs as we expanded our product and service offering. General administrative expenses were $2.8 million for the first quarter, a slight decrease of 0.1 million, or 4%, compared to $3 million for the same period in 2023. Overall, our operating expenses for the first quarter of 2024 were $8.8 million compared to $8.9 million for the first quarter of 2023. We continue to show operating leverage as OPEX was essentially flat while we grew our revenue 41% compared to Q1 2023. Net interest income was 0.1 million for each of the three months ended March 31, 2024 and 2023 as a result of interest rates remaining relatively consistent. As of March 31st, 2024, we had cash and cash equivalents totaling $35.4 million as compared to $23.1 million at December 31st, 2023, with the increase resulting primarily from the completion of a public offering of the company's common stock in March 2024, which resulted in net proceeds of $16.2 million. Our cash burn in Q1 2024 was $3.8 million, down 32% from the prior year's first quarter. We continue to maintain our focus on appropriate resource allocation and cash management, and we'll continue to focus on demonstrating operating leverage as we grow our revenue. I'd like to turn the call back to Joe.