EDAP TMS S.A.

Good day, everyone, and welcome to today's EDAP second quarter 2025 earnings conference call. At this time, all participants are in a listen-only mode. Later, you will have the opportunity to ask questions during the question and answer session. You may register to ask a question at any time by pressing star 1 on your telephone keypad. Please note this call is being recorded. I will be standing by if you should need any assistance. It is now my pleasure to turn the conference over to John Francis with LifeSci Advisors. Please go ahead.

Good morning. Thank you for joining us for the EDAP TMS Second Quarter 2025 Financial and Operating Results Conference Call. Joining me on today's call are Ryan Rhodes, Chief Executive Officer, Ken Movick, Chief Financial Officer, and Francois Dietsch, Chief Accounting Officer. Before we begin, I would like to remind everyone that management's remarks may contain forward-looking statements. which include statements regarding the company's growth and expansion plans. Such statements are based on management's current expectations and are subject to a number of risks and uncertainties that could cause actual results to differ materially from those described in such forward-looking statements. Factors that may cause such a difference include, but are not limited to, those described in the company's filings with the Securities and Exchange Commission. I would now like to turn the call over to EDAP's Chief Executive Officer, Ryan Rhodes. Ryan?

Thank you, John, and good morning, everyone. As we will review today, ADAPT Focal 1 HIFU remains instrumental in driving the execution of our defined growth strategy. In Q2, we experienced strong and accelerating demand for Focal 1 robotic HIFU. We reported global HIFU revenues of $9.7 million U.S. dollars, up 89% on a year-over-year basis. This increase was driven by the net placement of 12 focal one systems representing a year-over-year growth of 140% as compared to the second quarter of 2024. The 12 system placements comprised of nine capital sales, including one conversion of an operating lease to a capital sale at Kaiser Permanente, as well as operating leases at four large hospital systems. We are encouraged to see hospital networks from our current installed base such as Hackensack Meridian Health, Baptist Health, and New York Presbyterian Health purchase a second focal one system to support the expansion of their focal therapy program across multiple locations. Additionally, we are also proud to report that we now have a total of four focal one placements in Cleveland Clinic facilities worldwide. These include Cleveland Clinic Ohio, Cleveland Clinic Abu Dhabi in the United Arab Emirates, Cleveland Clinic London in the United Kingdom, and Cleveland Clinic Indian River in eastern Florida. We believe our strong second quarter HIFU performance represents a significant inflection point of accelerating growth of FOCAL1 and signals the potential of a broader adoption of focal therapy by community-based urology practices. Based on our most recent assessment of the market, we believe this accelerating growth is driven by three main factors. First and foremost, increased demand for FOC1 is being driven by new, rigorous scientific clinical data supporting HIFU and focal therapy in the treatment of prostate cancer. The groundbreaking HIFI study, which was recently published in European Urology, coupled with level one data from the randomized controlled FARP, or F-A-R-P study, presented at this year's American Urological Association annual meeting, are both helping to build an increased awareness around focal one robotic HIFU. Secondly, our reputation as the premier technology leader in focal therapy continues to grow. First introduced at this year's EAU and AUA meetings, the new focal one eye has been actively embraced by more and more urologists. The groundbreaking new features and design of the Focal One Eye are based directly on feedback from our customers, as well as anticipating the future needs of physicians performing focal therapy. We've incorporated the latest diagnostic imaging modalities and intelligent algorithms, enabling us to further personalize Focal One robotic HIFU procedures. In addition, we believe Focal One Eye's digital interface and fully robotic HIFU energy deliveries designed as uniquely suited to enable remote proctoring and remote collaborative procedures, as demonstrated by a recent collaborative activity across multiple Cleveland Clinic sites. As adoption of focal therapy continues to grow, we believe urologists are looking for the most advanced and capable technology to support their practice. The Focal-1i provides clear and compelling strategic value, not only within the urology suite, but also for hospitals that seek to offer the most advanced cancer treatment approaches to their patients. We are proud to announce that the first Focal-1i system has already been delivered in the U.S. during the second quarter and has successfully performed several procedures to date. Finally, we see an increasing number of patients becoming aware of the benefits of Focal-1. and are weighing their treatment decisions accordingly with further dry urologist interest in adopting our FOCA-1 HIFU platform. It is clear that patients want to access a non-invasive treatment option that can safely target their cancer while also enabling them to maintain their sexual function and urinary continence as compared to whole-gland radical treatment options such as surgery and radiation. During the second quarter, U.S. procedures grew approximately 4.8% over the second quarter of 2024. As noted on our first quarter call, our industry has been facing intermittent challenges across certain healthcare plan providers as it pertains to Medicare Advantage plans. This has impacted growth in certain markets in the adoption of HIFU. To mitigate this issue, we are working diligently with our market access partners to help accelerate preauthorizations for Focal-1 procedures. We are beginning to see ongoing improvements in individual procedure approvals, and we believe the compelling clinical evidence generated from both the large Hi-Fi and FARP studies will be instrumental in gathering expanded coverage while accelerating continued procedure growth. I will now provide a more detailed update on FOCAL 1 reimbursement in the US. In July, the Center for Medicare and Medicaid Services, CMS, announced its annual proposed rule for the hospital payment and physician fees for 2026. The proposed hospital payment for the FOCAL-1 HIFU procedure in 2026 is set at $9,765, which represents an increase of $518, or 5.6%, compared to the current payment in 2025. We view this as positive for our FOCAL-1 business, and more importantly, allows increased patient access to FOCAL-1 robotic HIFU. With respect to the physician reimbursement, CMS has proposed 26.43 total relative value units, or RVUs, for 2026. This translates to a Medicare payment of $888 based on the current proposed conversion factor for qualifying alternative payment model participants. It is important to note that the new codes created in the prostate ablation space for irreversible electroporation, or IRE, and water jet resection received total proposed RVUs that were significantly lower than the one allocated for HIFU prostate ablation, with IRE coming in at 19.76 total RVUs, or $664, and water jet resection at 16.14 total RVUs, or $542. Looking across the landscape for new reimbursement rules for 2026, we remain very well positioned in targeted prostate ablation with HIFU physician fees that are valued measurably higher than those for other competitive procedures such as cryoablation, TULSA, or IRE. Additionally, a new CPT code, Category 3, has been established to report the treatment of benign prostatic hyperplasia, BPH, with the use of HIFU. This new code became effective on July 1, 2025, and CMS has assigned it to the Urology APC Level 6 with an established payment rate similar to the one defined for HIFU in the treatment of prostate cancer. While we do not expect any meaningful revenue for BPH in the short term, we are pleased to see positive reimbursement news for HIFU for the BPH indication. which represents an area of strong interest in our development pipeline. It is important to note that a CPT Category 3 code would enable facilities to be reimbursed for a FOCAL 1 procedure as it would be performed as part of an investigational study in BPH, which maps directly into our current procedure development plans. Before turning the call over to Ken to review our financial results, I would like to provide an update on our corporate strategy. We are pleased to report meaningful progress in the development of our focal one endometriosis application. In March, we received CE marking for use of HIFU in the treatment of rectal endometriosis, an important regulatory milestone that validates the safety and performance of our technology in this new indication. In parallel, clinical evidence supporting this approach continues to grow, highlighted by the recent publication of the multicenter retrospective comparative trial by DuBernard and colleagues in the International Journal of Gynecology and Obstetrics. This study compared HIFU with surgery for rectal endometriosis. Results show that use of Focal-1 HIFU for the noninvasive ablation of endometriosis nodules achieves similar pain relief and quality of life improvements as compared to surgery. However, Focal-1 importantly showed reduced rates of complications while avoiding the typical morbidity associated with major pelvic surgery. Additionally, patients treated with HIFU also experience shorter recovery times and a lower risk of functional side effects. With CE marking now in place, we have initiated the first steps of commercialization in Europe. Beyond the immediate clinical benefit, this represents a significant commercial milestone for EDAP as it positions FOCAL-1 not only as a leading technology in focal therapy for prostate cancer, but as a true multi-application robotic therapeutic ultrasound platform. By expanding into endometriosis, we open the door to a new and very large patient population, which we believe has the potential to accelerate adoption and drive meaningful incremental sales growth for our installed base, including future placements. Now turning attention to development activities within our core therapeutic ultrasound technologies. Based on four decades of experience as a pioneer and market leader in the development and commercialization of extracorporeal shockwave lithotripsy, as well as our ongoing effort in high intensity focused ultrasound, we continue to invest in the research and development of ultrasound energy-based technologies. As a reminder, in November 2024, EDAP announced the achievement of a technical milestone demonstrating the feasibility of non-thermal, non-invasive histotripsy energy delivery using the Focal-1 robotic HIFU system to generate histotripsy lesions in biological tissues ex vivo. As noted, these results were presented at the 187th Acoustical Society of America meeting in November of 2024. marking an important step in the potential expansion of our ultrasound energy-based therapy platform. Building on this foundation, we continue to invest in future development and collaborations to advance the safety, precision, and efficacy of acoustic-based treatment modalities to include histotripsy. We look forward to providing additional updates as we continue to make progress on this front. As announced recently, we have entered into a letter of intent for a strategic financing facility with the European Investment Bank for 36 million euros, or approximately 42 million U.S. dollars. The capital raised through this financing is expected to enhance our balance sheet, offering a substantial source of low-interest funding that will support the continued expansion of Focal-1 robotic HIFU and focal therapy, while accelerating the development of new clinical indications. We also recently announced a transition from being a foreign private issuer to a U.S. domestic filer. Beginning on January 1, 2026, EDAP will begin complying to the U.S. Securities and Exchange Commission reporting rules, as well as NASDAQ listing requirements applicable to U.S. domestic filers. We believe this transition marks an important corporate milestone in our evolution as a public company and underscores our long-term commitment to regulatory best practices, transparency and expanding our presence within the U.S. investor community. We believe this move will benefit our shareholders while positioning the company to attract new institutional investors. Our intention to become a U.S. domestic filer is also consistent with our long-term strategic growth plan as we continue to position the company towards leveraging multiple high-growth opportunities for focal therapy. I will now turn the call over to Ken, who will review our second quarter 2025 results.