InspireMD Inc.

Ladies and gentlemen, good day and welcome to the INSPIRE MD second quarter 2020 financial results and corporate update conference call. At this time, all participants are in a listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on your telephone keypad. To withdraw your question, please press star then two. Participants of this call are advised that the audio of this conference call is being broadcast live over the internet and is also being recorded for playback purposes. A webcast replay of the call will be available approximately one hour after the end of the call through November 4th, 2020. I would now like to turn the call over to Scott Gordon, president of CoreIR, the company's investor relations firm. Please go ahead, sir.

Thank you, Stanford. Good morning, everyone, and thank you for joining us for the InspireMD second quarter 2020 financial results and corporate update conference call. Joining us today from InspireMD are Marvin Slosman, chief executive officer of InspireMD, and Craig Shore, chief financial officer. During this call, management will be making forward-looking statements, including statements that address InspireMD's expectations for future performance or operational results, particularly in light of the COVID-19 pandemic. Forward-looking statements involve risks and other factors that may cause actual results to differ materially from those statements. For more information about these risks, please refer to the risk factors described in InspireMD's most recently filed Periodic Reports on Form 10-K and Form 10-Q, the Form 8-K filed with the SEC today, and InspireMD's press release that accompanies this call, particularly the cautionary statements in it. The content of this call contains time-sensitive information that is accurate only as of today, August 5, 2020. Except as required by law, InspireMD disclaims any obligation to publicly update or revise any information to reflect events or circumstances that occur after this call. It is now my pleasure to turn the call over to Marvin Slosman, Chief Executive Officer. Marvin.

Thank you, Scott, and thank you all for joining the call and webcast today. As I reflect back on our first quarter earnings call, I talked about uncertainty in the world amid the COVID-19 pandemic and the global challenges it's created. I'm happy to report that even as the pandemic persists, Our team continues to respond and deliver with great poise and commitment to fulfilling our customers' needs. Despite the continued rise in COVID-19 cases placing pressure on healthcare operations globally, specifically with regard to volume of elective procedures, including carotid stent placement, we're still providing critical and life-saving products that are proven superior in safety and producing effective outcomes, although at a slower pace than pre-pandemic. However, these lower volumes are tempered by the gradual reopening of facilities and practices throughout Europe, as well as expanded territories, which I will discuss shortly. To be sure, our Q2 financial results were adversely impacted as a result of the healthcare system, diverting attention and resources to fighting COVID-19. Governments implemented restrictions on elective procedures and people avoided seeking treatments, even for emergency conditions. We are, however, seeing a resurgence of elective procedures in our key markets and expect we will continue to see gradual resumption as the impact of the pandemic is better managed and controlled. We've also taken proactive measures to implement policies and procedures that will ensure that we emerge from this crisis as strong as possible, including continuing to look at ways to operate more efficiently and lower our operating costs. were encouraged by the fact that prior to COVID, our 2020 trajectory was very positive and shaping up to be a meaningful year, which we hope to reemerge after the recovery. I would like to now share three significant achievements for our company, milestones we've anticipated for some time and are proud to have achieved in Q2 as levers of growth and further value creation. In June, we announced the completion of an equity financing raise of $11.5 million. The offering included $1.5 million from the underwriters full exercise with over allotment option for the offering. The additional cash on our balance sheet will go a long way to help ensure the health of our business and advancement of programs and commercial focus even during these challenging times. We perceive the success of this offering as a proxy for confirming our value proposition in the marketplace even under extraordinary circumstances which the pandemic has created. One that provides us with a crucial runway to continue accomplishing on our expansive growth plans and important drivers and milestones. Despite the challenges imposed by the pandemic, we accomplished a critical milestone for our continued international expansion in the second quarter as well, with the announcement of our approval by the Brazilian Registration Authority to distribute our Seaguard Micronet covered stent In Brazil, which is the largest healthcare consuming market in South America and is expected to reach 1.8 billion with a growing CAGR of 9% throughout the forecasted period of 2023. This is a critical development for us as it represents an opportunity to serve a major emerging healthcare system. Brazil ranks as the sixth largest populous country in the world, and we have partnered with Supri, one of the largest medical supply distributors headquartered in Sao Paulo, to reach and serve this critical market with our advanced technology. This approval is an important milestone for us and supports our global and continued expansion in South America, particularly in adjacent markets such as Argentina and Colombia. Also during the second quarter, we announced the results of the Siberia clinical trial, which evaluated C-Guard versus Abbott Labs AccuLink. The Siberia trial evaluated 100 patients who qualified for carotid Re-vascularization with high-risk surgery and were randomized one-to-one with either C-Guard or AccuLink. The study evaluated 30-day silent brain infarcts associated with the use of AccuLink conventional open-celled nitinol stent versus the C-Guard Micronet covered stent. In this head-to-head evaluation, our product showed a three-fold decrease in silent brain infarct versus AccuLink with zero post-procedural death Thank you for joining us today. consecutive real-life patients treated with C-Guard Micronet for carotid stenosis and the 12-month prevention of post-procedural neurological events. Without going too deep into the data, 12 months after the carotid intervention, the C-Guard EPS Micronet covered stent delivered sustained protection against post-procedural neurological events. At 30 days, only one adverse event occurred, a minor transient stroke, with no other strokes, myocardial infarcts, or death. No strokes occurred between 30 days and 12 months. This study has continued to follow patients up to five years from the initial implant, and the results have been very promising. As perceived safety concerns are a major obstacle to more widespread stenting versus carotid endarterectomy surgery, this data is critical to our ongoing efforts to convert not only the conventional stent market but also vascular surgeons who perform more than 80% of carotid artery revascularization procedures. Finally, on June 25th, 2020, the US FDA granted conditional approval for our investigational device exemption or IDE application to initiate a pivotal study of C-Guard EPS. The conditional approval is contingent upon InspireMD addressing the stent embolic protection device, EPD, We have already completed this testing of additional stents according to the FDA specification and have employed alternative visualization modalities that we believe will ultimately allow us to gain full approval. Having an approved IDE is an extremely significant step toward enabling us to initiate a pivotal trial in the United States. We previously indicated that the FDA had concurred with our clinical study design and data requirements to support the market approval of the device. Accordingly, we believe that we are well positioned from a regulatory perspective in terms of our ability to initiate the trial. I would like to turn now to our second quarter and first half results. Recall that last year we experienced an issue with our sterilization partner that essentially prohibited us from shipping product during the first quarter of last year. The impact was to shift $592,000 of sales from the first quarter into the second. That, together with the impact of COVID-19, makes a year-over-year comparison more difficult than otherwise would be the case. With that said, for the three months ended June 30, 2020, we generated total revenue of $313,000 as compared to $1.354 million for the same period a year ago. For the six months ended June 30, 2020, We generated a total revenue of $1.347 million as compared to $1.769 million for the same period in 2019. We did anticipate and realize softness in Q2 procedural volumes as hospitals and physicians pivoted to treat COVID-19 patients. As a reminder, carotid stenting procedures are elective in nature, at least in terms of timing. But I'm pleased to report that we're seeing signs of rebound in elective procedures in several of our key European territories, notably Italy, Spain, and Germany. And our initiatives to regain share in those markets are progressing. And in addition to our US IDE activities, we continue to execute on our planned expansion into growth markets in South America and the Asia Pacific region. As I stated last quarter, I also see numerous opportunities to expand our pipeline, leveraging new indications for use of C-Guard and Micronet, along with our research into a periprocedural protection device, which is advancing in development. So notwithstanding the enormous challenges proposed by the pandemic, I am as optimistic as ever that our technology represents a true advancement in the treatment of carotid artery disease and potentially other vascular I would like to credit the entire InspireMD team for quickly adapting to the new work culture, new normal necessitated by the pandemic and driving us forward as a company to continue to progress toward our shared long-term goals. To prepare for the anticipated rebound, we worked during the second quarter to ensure that both our support organization as well as our ability to supply product remain firmly intact. These initiatives are already paying dividends as we see demand revert back to pre-pandemic levels. At the same time, we continue to take a close look at our operating expenses. And while I believe we're running a lean and efficient organization, we're always on the lookout for additional ways to extend our cash runway. As we've discussed before, the backbone of our go-to-market strategy is ongoing conversion of vascular surgeons who, as I've said, performed a vast number of carotid revascularization procedures, more than 80%, through carotid endarterectomy. We view carotid artery disease as the next significant vascular condition to evolve toward an endovascular standard of care, much the same way that cerebral aneurysms, coronary artery disease, thoracic and abdominal aortic aneurysms, and peripheral artery disease have already done. This is why the vascular surgery community remains an important priority. Part of this strategy includes exploring additional periprocedural protection devices to our portfolio. We look forward to advancing our efforts in this initiative and working with leading vascular surgeons on our strategic pathway. With C-Guard EPS, we have what we believe is a superior technology platform in a market segment that is poised for rapid expansion in the coming years. Turning now to new market developments. As we indicated last quarter, COVID-19 has extended certain timelines associated with product registration and distribution contracts with channel partners that we've been pursuing in other countries in Europe, Asia, and Latin America. But besides these challenges, we've been continuing our internal work to achieve these approvals and key milestones for growth. In addition to expanding our reach in Brazil, the French market remains a pillar of growth in our European strategy. We're pleased to report that despite being particularly hard hit by the pandemic, thus delaying our discussions with the French health authorities, we're now advancing the approval for C-Guard EPS under the standard reimbursement option with additional consideration to special reimbursement. This bifurcated strategy allows us to faster access the French market and in addition puts in place a pillar of our direct sales model. In terms of Asia Pacific, both China and Japan represent more than double our current addressable market, And as such, these markets are another high priority for our business. Thus, we continue discussions with potential distributor partners in both regions to expand in these highly valuable Asian markets. And with that, I'll turn the call over to Craig for review of the second quarter financials. Craig.