IceCure Medical Ltd.

Welcome to IceCure's conference call on the financial results for the first half of 2022. Management will provide an overview of IceCure's financial results as well as clinical, commercial, and operational highlights. Participating on the call today are IceCure's CEO, Eyal Shamir, and CFO, Ronen Zimmerman. They are joined by Dr. Kenneth Tomkovic, the co-primary investigator for IceCure's ICE3 ProSense clinical trial on cryovolation of small low-risk breast cancers. Following the presentation, IceCure's management and Dr. Tomkovic will be available for a question and answer session. 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 it 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, ISECURE is using forward-looking statements in this presentation when it discusses pursuit of regulatory approval in various jurisdictions strategic plans, commercial growth, expansion of clinical applications, and potential market adoption of its minimally invasive cryo-relation technology, advancing regulatory and commercial strategies, and expected quarter-over-quarter revenue variations and other key business highlights for future periods. 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 ice cure differ materially from those described in or implied by the statements in this presentation. The forward-looking statements contained or implied in this presentation are subject to other risks and uncertainties, many of which are beyond control of the company, including those set forth in the risk factors section of the company's annual report on Form 20-S, for the year ended December 31, 2021, filed with the SEC on April 1, 2022, which is available on the SEC's website, www.sec.gov. The company undertakes no obligation to update these statements for revisions or changes after the date of this release, except as required by law. I will now turn the call over to IceCure CEO Eyal Shamir.

Hello, everyone, and thanks for joining us today. We'll start with a review of our significant business development for the first half of 2022, followed by an overview of the financial results. We'll then hear from Dr. Tomkovic, who will share his thoughts on breast cancer cryoablation from the radiologist's perspective before opening the call for Q&A. During the first half of 2022, through our only own subsidiary, SQ Shanghai, we signed an exclusive distribution agreement in mainland China for iSensory, which is ProSense's brand name in China. We signed this agreement with Shanghai Medtronic Zicang Medical Devices Company, NTD, an affiliate of Medtronic PLC. and Beijing Turing Medical Technology Company, MTD. This high-value commercial agreement with the division of Medtronic, the world's largest medical devices company, is a key strategic milestone for IT in one of the most important healthcare markets in the world. Tanhai Medtronic Zicang Medical Devices Company, NTD, has expertise in market power to facilitate rapid market penetration for ISIN3 in China. We believe China is a market in which cryoablation technology Currently, as minimal market penetration, an immense potential driven by the country accelerated adoption of a new technology that improved outcomes. The government of China is investing heavily in healthcare infrastructure. By 2030, the size of the healthcare market in China is expected to reach $2.3 trillion. According to McKinsey report, This is more than double its size in 2020, according to statistics. Shanghai Medtronic Zicang Medical Devices Company, LTD, will be the exclusive distributor for the ISOM-3 system and its disposable crops in mainland China and for an initial period of three years. Minimum purchase target for the first three years of the agreement is $3.5 million. We expect to deliver and book revenues for the first ISM-3 systems under this agreement in the second half of 2022. ISM-3 has already been approved by the China Health Regulatory Body National Medical Product Administration. We have submitted an amendment application to the registration certificate for approval of the disposable probe, which, if approved, will allow us to sell disposable ISM3 cryoprops for commercial use. We expect to receive such approval for the props by the end of 2022. In addition to this major deal with Shanghai Medtronic Zicang Medical Devices Company in China, in the second quarter of 2022, we sold and installed our POSON system in several clinics worldwide. This includes clinics in the U.S., the Manna Breast Center in Arkansas, and Georgia Breast Care in Georgia. ProSense was also installed at other healthcare facilities in Turkey and Poland, where the first breast fibroadenoma treatment was conducted with the ProSense in those countries. We have also sold and installed our ProSense system in France. The Nate Zeon Medical Center in Israel conducted its first breast cancer treatment with ProSense. Based on the level of commercial interest during and after the second quarter, we expect the number of these kinds of installations and cells may potentially increase. We continue to expand our regulatory landscape During the second quarter, regulatory applications were signed in Brazil and Canada. In addition, the one signed in China for the ISIN3 disposable probes at the end of 2021. In Brazil, regulatory applications were signed for the crossing system for indications including breast, and other cancers, benign tumors, and palliative intervention. We have been approached by a number of Canadian healthcare providers interested in ProSense as a key seek to offer minimally invasive treatment for breast and other tumors. Regulatory application was filed in Canada for the process system for numerous indications, including the ablation of benign and malignant breast tumors. We are very active presenting, demonstrating, and training physicians in the use of process, which is consistently very well received. During the second quarter of 2022, we participated in 10 conferences and events. We presented the course of a cryoablation breast cancer tumor at the Society of Interventional Radiology annual meeting in Boston. At the 23rd annual meeting of the American Society of Breast Surgeons, our publication regarding our I3 breast cancer cryoablation study internal results was chosen as one of the best papers of 2021 from thousands of breast cancer articles published annually. We did hands-on demos of process at the European Conference of Interventional Oncology, moreover at the Society of Breast Imaging, American College of Radiology Conference, First tumor ablation course was presented by two ProSense users. Clearly, ProSense is gaining traction in the U.S. and with the global medical community, including breast surgeons, interventional radiologists, and interventional oncologists. As we work to expand our regulatory landscape and commercial reach, we believe that this activity will be reflected in our revenue in the future. I will now turn the call over to Raman for financials.

Thank you, Eyal. For the six months ended June 30, 2022, revenue decreased by 27% to $1.5 million and compared to $2.1 million in the first half of last year. The decrease is due to decreased revenue recognition of approximately $400,000 from distribution agreements with the rumor for the commercialization of procents to treat malignant breast tumors in Japan, Singapore, and Thailand, and a decrease in sales in Asia which continued to be impacted by COVID surges and associated restrictions on commercial activity. These decreases were partially offset by an increase in sales in the U.S. and Europe. Gross profit was approximately $800,000 from the six months end of June 30, 2022, compared to approximately $1.2 million for the same period in 2021. Gross margin was approximately 54% for the six months period end of June 30, 2022, compared to approximately 58% for the first six months of 2021. The slight decrease in gross margin is mostly attributable to the decrease in sales and in revenue recognition from the Terumo distribution agreements. Research and development expenses for the six months and the June 30, 2022 were $4.6 million, compared to $2.7 million for the same period last year. The increase is attributed to the acceleration in development of iSQ's next-generation single-probe system and clinical and regulatory activities, mostly in the U.S., China, Brazil, and Canada. Selling, marketing, general and administrative expenses in aggregate for the six months and the June 30, 2022 were $4.9 million compared to approximately $2.2 million for the first six months of 2021. The increase is attributed to the company's expanding commercialization efforts, increasing our participation in conventions and conferences, and to increase NASDAQ listing-related expenses. Total operating expenses for the six months ended June 30, 2022 were approximately $9.5 million compared to $4.9 million for the same period last year. The increase in operating expenses is attributable to increased development, commercialization, and NASDAQ listing-related activities. As a result of lower revenue and increased operation activities, net loss reported for the six-month period ended June 30, 2022, increased to approximately $9 million, or $0.24 per share, compared with a net loss of approximately $3.8 million, or $0.16 per share, for the same period last year. As of June 30, 2022, the company had cash and cash equivalents of approximately $17.7 million, compared with approximately $25.6 million as of December 31, 2021. I will now turn the call over to Dr. Kenneth Tomkovic. Dr. Tomkovic is a co-primary investigator for our I3 clinical trial on cryoablation of small, low-risk breast cancer. Dr. Tomkovic is a diagnostic and interventional radiologist with Princeton Radiology and director of breast imaging and interventions at Center State Medical Center, New Jersey. A prolific researcher, Dr. Tomkovic has authored or co-authored articles in several medical journals, including Respiratory, Medicine Academic Radiology, Emergency Radiology, and the American Journal of Archaeology.

Thank you very much for that introduction. My name is Dr. Kenneth Tomkovic. I am a radiologist with Princeton Radiology in Princeton, New Jersey, in the United States. I'm also one of the lead investigators in the ICE-3 trial for breast cancer cryoablation. My experience with cryoablation has And over 14 years, I've been practicing as a radiologist and interventional radiologist for 23 years. But my interest in breast cancer cryoablation really peaked somewhere around 2008 when I was doing other interventional procedures and other ablation procedures for other organs such as the liver and lung and kidney. And I posed the question, why are we not doing more breast cancer cryoablation? So I started to research the topic and published some articles in different journals and in a textbook chapter on breast interventions, hypothesizing the possibility of doing breast cancer cryoablation as a primary treatment for breast cancer. From that point, we developed the I3 trial and attempted to study patients who were low risk patients having low risk breast cancers, low grade, small primary cancers, 1.5 centimeters or less. And we included patients who were 50 years and older in the trial. And after developmental phase, started enrolling patients in that trial in 2014 with the goal of following all those patients for five years with mammography only. This is the first trial in humans in the world that included this patient population but did not follow the ablation procedure with any type of surgical resection. So we've been following those patients, accumulating data. And the last patients were enrolled in 2019 in the trial. And we continue to follow those patients and follow the results with hopefully the final results coming at the end of 2023 or early 2024 for the I3 trial. Personally and professionally, it's been a very rewarding year with continued expansion and acceptance of this theory and this concept of performing cryoablation for patients with breast cancer. Only five or six years ago, most of my colleagues would have thought that this was not a possibility or maybe not even a good idea. because surgical empectomy is the state of care. But today, in 2022, I can honestly say that the acceptance of this procedure and the way we perform this procedure using the ProSense system and the ice cure medical technology has really become increasingly accepted and adopted amongst many subspecialties, including breast surgeons, interventional oncologists, breast radiologists, general radiologists, and interventional radiologists. Personally, I've had a very successful and rewarding year. I've been honored to have a publication accepted for scientific presentation, an abstract accepted for scientific publication and presentation at this year's very prestigious RSNA meeting in Chicago, that was in the fall of 2021. There was a presentation there on results, six-year FOP results from the ICE-3 trial, as well as a poster that presented the imaging findings post-crioblation, which are very important to radiologists because there is no data set of these imaging findings except for that in the ICE-3 trial because there's been no long-term studies on this prior to ICE 3 showing the specific imaging findings of patients who were followed with prior ablation without resection. Following that, I've had invitations and spoke at the Society of Intermittent Radiology meeting in India, in Goa, India. I presented remotely for that conference. I've also presented this year at the Chinese Society in the past year, the Chinese Society of Interventional Radiology Conference on the topic of breast cancer cryoablation, in which we actually had a symposium and a whole course was offered for that meeting, which I was honored to be asked to participate in that. And that was a great presentation as well. Continuing on in 2022, I presented at the European Society of Interventional Oncology, ECIO meeting, European Congress of Interventional Oncology in Vienna. That was in the spring, and not only did we present the research on ICE-3 that was accepted for presentation at the meeting, but also there was a hands-on session with several members of Congress participating in the hands-on training with what I felt personally was great interest in this procedure and this technology going forward. After that, I attended the ARRS, the American Microwave Society meeting in New Orleans, where I was a moderator for an interventional radiology session and attended a session presented by my colleague, Dr. Ward from Brown, on trial ablation for breast cancer at that meeting. And then the culmination probably of the year and several years of this research and work that I've done was the acceptance and the presentation of a full categorical course at this year's Society of Endometriobiology meeting in Boston, Massachusetts, June. That was a full 90-minute categorical course. whereby several of my colleagues participated and to give a sense of, again, the increasing global acceptance of this procedure, which I've personally trained physicians throughout the United States on how to perform this, as well as had training sessions with physicians in Israel, in South Africa, in China, in Singapore. throughout Europe. But this particular meeting, we were able to present not only in person, but via remote access to physicians throughout the world, along with my colleagues from Jefferson, Dr. Alexander Severkov and James Seamus. My colleague, Dr. Monica Wang from MD Anderson in Houston participated in this session. And again, to emphasize the global reach and impact of this procedure, Dr. Asuki Fukuma from Japan and my colleague from China, Dr. Gaojun Tang, also presented their experience of breast cancer cryoblation at the SIR conference in Boston. So it was a very comprehensive course. It was very well received by the Society of Inertia Radiology. And after that, I was asked to give a follow-up virtual presentation, which was recorded for a few on the outcomes of the SIR meeting, give a presentation so that people can view this procedure and what we presented at the SIR online as well. So going forward, I see this technology continuing to be adapted more broadly, not only throughout the United States, but throughout the world. There are registries forming to study the outcomes of breast cancer correlation in patients outside of the research trials. And looking forward, I think that there's going to be a wider adaptation of this technology and this procedure. Personally, I find it most rewarding when I see patients back who have treated now five and six years post-ablation that are cancer free. They have no cosmetic effects from this procedure. They have no visible scarring or you would never know that this was done. And they have been cancer free now for Some of my patients are five and six years post-ablation, and I'm very satisfied and very happy for those patients that they've had those outcomes. So that concludes my remarks regarding where we're at with breast cancer trial ablation and my personal experience over the past year. Thank you.

Thank you, Dr. Tomkovic, for sharing your insights. I'm sure our shareholders appreciate your perspective as a clinician who has been using ProSense. Operator, we would like to now open the calls for the analysts.

Thank you. Ladies and gentlemen, at this time, we will begin the question and answer session. If you have a question, please press star 1. If you wish to cancel your request, please press star 2. If you are using speaker equipment, kindly lift the handset before pressing the numbers. Your questions will be polled in the order they are received. Please stand by while we poll for your questions. The first question is from Ben Hainer of Alias Global Partners. Please go ahead.

Good afternoon, gentlemen. Thanks for taking the questions. First off, for me, Dr. Tomskovich, I wanted to kind of explore, I guess, your history. You were fairly early in 2008 kind of looking at that, at cryoablation in breast. My recollection around that time was you had kind of quite a soap opera going on with EndoCare and Galeel Medical, the CEO of EndoCare going to jail, and then the the aborted merger between the two companies there. You know, I guess what attracted you to cryoablation at the time, and then, you know, it seems like there's been quite the resurgence in attention to it, you know, kind of with ice carrying the torch, it seems. Any additional color there would be helpful.

Yeah, you know, I personally don't really know anything so much about that issue that you mentioned between Galil and EndoCare, but I will speak to your question regarding prior ablation and my focus on it. There are several ablation technologies that are available. As you may or may not know, there's microwave ablation, there's RF ablation, there's laser ablation, there's irreversible electroporation, Those are kind of like heat-based modalities. And when you administer those modalities, you kind of have to ground the patients. A lot of times they need general anesthesia or at least heavy conscious sedation. Some of them use several probes. And for the breast, when I was trying to develop this, protocol for ACE3 and seeing which might be best suited for my patients. The ice ball is extremely well seen by ultrasound, which will be used for guidance for this procedure. And it doesn't require any type of anesthesia. All we do is administer local anesthetic. I typically use 10 mLs, 1% lidocaine. The patients are awake and alert. The ice ball, when it forms itself, is, again, highly visible. And you can see very clearly the ablation. The breast parenchyma is really left intact. There's no burning. There's no significant thermal reaction or scarring. You know, what I tell people often, imagine like a piece of bacon. If you fry that piece of bacon, what does it look like? It shrivels up. But if you take that piece of bacon and you burn it in the freezer... And you take that out a week later, it still looks like that same piece of bacon. So that's kind of what I put in people's brains when they think of a prior ablation versus heat-based ablation. And then in addition, you know, the patient's at this procedure, we take out the probe, we burn a Band-Aid, and they walk out with their family members and go to have lunch about an hour after the procedure started. So that's my summary of why I've chosen prior ablation. And... And, you know, why I went with the ICE-3, with the ProSense technology and IceCure Medical, I think the probe is well-suited. It's a single-probe insertion. The ice ball form is very highly visible and forms quickly, and the safety profile so far has been excellent with my patients.

Okay. That's very helpful, Colin.

And I guess...

Maybe this requires some speculation on your part, but at the time you mentioned that your colleagues, you know, maybe thought, you know, well, this isn't that great of an idea or what have you. I mean, was that just, you know, kind of inertia to the status quo at the time for mastectomy? Or, you know, what was your sense of their thinking back then?

Well, the thought was that this has been tried before, and if you look at the past literature since 99, or even 98, 99, there's been articles published about ablation for breast cancer with varying results, and not to go through all the minutiae, which took me about four or five years to figure out kind of the Rubik's Cube of why these other things did not work. You know, the... The reasoning behind why my colleagues were hesitant was because they saw failures and they knew that surgical lumpectomy is pretty much the standard of care. Now that we've shown results five years, six years post-ablation, and when I go to present at meetings and I present the concept and the research behind ICE-3, this is now you know, that a lot of people are saying they're having this aha moment where they say, ah, yeah, you kind of figured it out. Now we see where you're going with this. We certainly see the potential. And I think, you know, from what I mentioned earlier, multiple countries are now interested in participating. Multiple sites throughout the U.S. are participating. Colleagues from major centers are now interested. So it's nice to have everybody kind of jump on board, you know, and agree with what I thought of, you know, several years ago one other thing I wanted to mention about you know the current system that I'm using it's liquid nitrogen based which is nice for outpatient procedures because it's small it's a small subunit it's self contained you don't need a lot of times when you use argon gas which is like the galil system I think and some other out there it requires either a hookup to a wall or these large tanks that have to be in the room. You don't have that with the ProSense system. You just fill up a dewar with liquid nitrogen, and you insert that into this machine, and it's portable. You can take it from room to room, and that's another plus with this procedure that I failed to mention.

Okay, that makes sense. And then one, maybe I'm misremembering this, but... You mentioned the imaging findings post-cryoablation. I think that historically there may have been some confusion on potentially how to interpret those. Has that kind of been overcome and now people know what they're looking at when they see imaging post-cryoablation, whether it's shortly after the procedure or six months after the procedure or what have you?

Well, for myself and my colleagues who have participated in the trial, it's been 19 sites throughout the United States, and then I mentioned some other earlier adopters. We know what to look for on the imaging, and I've continued to present these findings like I presented at RSNA now back in 2021, and I guess I can mention that Coming up for RSNA 2022, I've also had a public paper presentation on this very topic, on breast cancer, cryoblation, and the imaging findings that I'll be presenting, along with Dr. Wang and her colleagues from MD Anderson at RSNA 2022. So we're also in the process of finalizing some publications. Hopefully, they'll be available shortly to be published in the literature, again, answering that question of what is the new normal. It's a very important topic because we want to prevent unnecessary biopsies, and at the same time, we want to recognize, you know, those cases where there are patients with a residual or recurrent tumor that we have to address in patients who are post-bioblation. Although those cases so far... have not been common. But, yeah, we have a really nice subset of those images through I3, and we're starting to share those with the community of physicians throughout the world.

Okay, so something to stay tuned for. And then, you know, just thinking about the procedure you mentioned, you know, they're walking out, going to lunch with their family an hour after the procedure is Plus, you've got a better aesthetic outcome in almost all cases, I guess. I would imagine the aesthetic angle is pretty big for most patients. Is there a reason why patients would choose not to have cryoablation, assuming that the tumor size is appropriate and all those considerations? over a lumpectomy or a mastectomy. I assume mastectomy if they're really worried about the cancer spreading. Just any color on how your patients look at this.

Well, those patients of mine who have undergone the procedure can't imagine having the other procedure, having the standard of care lumpectomy or mastectomy for breast cancer. So Um, that's their perspective. And, uh, from my perspective, I think it's just a matter of time before this becomes, you know, a more widely accepted again from where we were, uh, again, uh, from my colleagues saying, you know, don't know if this is going to work. Uh, not, not sure this is a good idea to now everybody's, you know, contacting me, uh, you know, how do we do this? What, what, what's involved, you know, uh, I think the fact that the SIR had us as a full categorical course this year speaks volumes to the interest. As a matter of fact, I didn't mention this, but a month after SIR, they have a quarterly publication where they featured our session as their lead article in their quarterly publication. There's increasing interest, and I think it's just a matter of, you know, people learning more about this procedure, greater acceptance by people throughout the medical community and by patients. And I think a lot of it's going to end up being patient-driven as well. When they start to hear about this as an alternative, the surgical infecting, I think a lot of people may use this over what currently is the standard of care.

Okay, that makes sense. You touched upon registries kind of coming together. I think Dr. Fine on last quarter's call mentioned that the ASPRS was looking at developing one, and maybe the Mayo Clinic and the University of Washington are also looking at stuff. But it sounds like there's quite a bit of interest in developing these registries. You know, what's your thoughts on those and, you know, how that could kind of help bring more folks to the procedure?

Yeah, I think that's a good point. You know, Dr. Fine is a colleague of mine and one of the lead investigators also on ICE-3 from the breast surgeon's standpoint. So working with the breast surgeons and working with breast radiologists and interventional radiologists and interventional oncologists specifically, people who specialize in the oncology field, it's important to share our data and to accumulate data so that we can see who's being treated, what's successful, what may not be successful. If certain people are pushing the envelope on this procedure, You know, we were very conservative or fairly conservative, I would say, but appropriate in the ACE3 patient selection. And, you know, but moving forward, I think there's multiple other areas to go, you know, through cancer research and multiple other patients might be included in the cohort of patients. And that's where registries will come in, helping to... to record and classify who was treated and what kind of outcomes that they had. So I think that'll be important going forward.

Okay, great. And then a couple quick ones for the ice care team. On the clinics that you signed up or that you had ProSense systems installed at here in Arkansas and Georgia, do you get the sense that they plan to use those for both fibroadenomas and breast cancer cases or just stick with fibroadenomas for the time being until the FDA clearance?

Thank you for the question. They are using both breast cancer based on our general 510 clearance. and also for fibroadenoma, and they are using it, they are doing it as a cash case. So the patients at the moment are paying out-of-pocket payment, and they are doing both breast cancer and benign breast tumors, fibroadenoma.

Okay, got it. And then just any updates that you have on the planned FDA submission, You know, any conversations with the FDA, and I apologize if I missed this earlier on a couple calls here. And then, you know, timeline for the submission, anything you can share there would be helpful.

Yeah, we have been talking with the FDA based on the breakthrough device designation we received, and the team are now extremely busy and working on the submission to the FDA, and we will update and announce as soon as we will submit it to the agency.

And you still expect that to be before the end of the year?

Yeah, absolutely.

Okay, great. And lastly for me, go ahead, sorry.

The submission will be before the end of the year.

Okay, great. And lastly for me, you know, ICES III you've got cleared in China. You know, is there any thought of getting process cleared there, or is the ICES III kind of the go-to-market product in that market?

The iSense 3 is the process brand in China, like I explained, you know, with my overview. And this will be, you know, the product that we will start with Metronic China, Zikang, and Puingmet. So the iSense 3 is our current brand name in China.

Okay, got it. That's all I have, gentlemen. Thanks for taking all the questions. Hopefully I didn't monopolize the whole call.

The next question is from Kemp Dooliver of Brookline Capital Markets. Please go ahead.

Great. Thank you. First question is this. Can you share updated patient follow-up data from the trial?

Thank you. If you could recall from our investor deck, the ICE3 study was 194 eligible patients, the multi-site study in 19 sites. And by June 2022, We had 82 patients that completed the trial, which means follow-up for full five years. We have, of course, many patients that the follow-up is even more than four years. And even the last patient that we enrolled on February 2019 now has like three and a half years follow-up. So most of the patients are over 40, 42 months, and some of them completed the trial with 60 months, five years follow-up.

Okay. And with the same trends with regard to recurrence and, you know, the other measures you're tracking?

The recurrence is, of course, our primary endpoint. And we are discussing it now with the FDA. The last publication or the last information that we had is what we published on April 2021. And by that time, we had four patients with recurrence, which was 2.06% local recurrence for breast cancer. So this is the information that we currently have. could share.

Okay. Thank you. Can you tell us the size of the installed base now?

You know, this is, you know, of course, commercial, confidential information, but we have the sites in the U.S. who are doing breast cancer. We have... sites all over Europe that mainly doing interventional oncology which mean soft tissue ablation, kidney cancer, lung cancer, liver, bone as a palliative and other organs as well as in Asia. We are not sharing the information. of a specific install base. We mentioned some of the top sites both in Europe and in the US. So this is the information that we could share. Like any of our competitors are not sharing any confidential information on install base.

OK. I understand. Thank you. And I think the last question before I ask anything of Dr. Tomkovic, but given your spending levels and plans through the first half of the year, is this a reasonable run rate to think about for the full year, or are there any changes that we should take into consideration?

Can you please repeat? It's Ronen. I can't hear the last part of your question.

Certainly. So we have six months of expense data now with R&D, marketing, G&A, and how representative would those spending rates be for the full year? Do you expect it would annualize at that level, or would there be any noticeable change?

So we don't think there will be any noticeable changes. So we believe that we will spend basically what we've, you know, on the same burn rate. our budget is quite flexible so we can make the necessary changes if we feel that we need to.

Okay, super. And for Dr. Tomkovic, are there any substantial differences in the breast cancer patients you see versus a breast surgeon that we should take into consideration when we think about adoption and use of the system?

The patients that I'm seeing are really the same patients that the breast surgeons are seeing. As I mentioned, we're working right along with the breast surgeons. There are several breast surgeons who are site investigators for ACE3 who are themselves performing breast cancer cryoblation. Again, Dr. Fukuma from Japan and Dr. Fine here in the U.S. are two of the leaders that are breast surgeons. And the patients that we're seeing, that really, you know, if you think about the patients that are the ones who were included in ACE3, That really comprises about 56% of all the breast cancer patients that I see on a daily basis in my clinical practice. So it's a pretty large number.

Okay, super. Thank you. And actually, one question back to the management team. The regulatory strategy is still a bifurcated filing based on high risk versus low risk?

You're talking about FDA?

Yes, FDA. Thank you.

Yeah. The first indication that we are planning to submit is the low-risk or what we call early stage T1 invasive breast cancer, which is more related to the low-risk early stage. And patients who are at the high risk to surgical alternatives, this will be based on the interim results.

Great. Thank you.

Thank you. There are no further questions at this time. Mr. Shamir, would you like to make your concluding statement?

I would like to thank Dr. Tonkovich and all the participants. Our ISQ is really working hard to offer our unique valuable position, which is the treatment for breast cancer. Side by side with the other organs that we are treating, we are seeing that we have more and more approach from users and patients. And we are happy to offer this treatment to any place that we approved from the regulatory point of view. So thank you very much, everyone.

Thank you. This concludes the IceCure Medical LTD Second Quarter 2022 Results Conference Call. Thank you for your participation. You may go ahead and disconnect.