Profound Medical Corp.

Good day, and thank you for standing by. Welcome to the Profound Medical First Quarter 2022 Financial Results Conference Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 1 on your telephone. Please be advised that today's conference is being recorded. If you require any further assistance, please press star 0. I would now like to hand the conference over to your speaker today, Stephen Kilmer of Investor Relations. Please go ahead.

Thank you. Good afternoon, everyone.

Let me start by pointing out that this conference call will include forward-looking statements within the meaning of applicable securities laws in the United States and Canada. All forward-looking statements are based on Profound's current beliefs, assumptions, and expectations and relate to, among other things, expectations regarding the efficacy of the company's treatment technologies, results of future clinical trials, the ability to obtain coding and or reimbursement from third-party payers, anticipated financial performance, business prospects, strategies, regulatory developments, market acceptance, and future commitments. Such statements invoke known and unknown risks and uncertainties and other factors that may cause actual results, performance, or achievements to be materially different from those implied by such statements. No forward-looking statement can be guaranteed. Listeners are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this conference call. Profound undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise, other than as required by law. For the benefit of those who are new to the Profound story, I would also like to take a moment to summarize our business. Profound develops and markets customizable incision-free therapies for the ablation of diseased tissue. We are currently commercializing TELSA Pro, a technology that combines real-time MRI, robotically-driven transurethral ultrasound, and closed-loop temperature feedback control. The technology is designed to provide customizable and predictable radiation-free ablation of a surgeon-defined prostate volume while actively protecting the urethra and rectum to help preserve the patient's natural functional abilities. Tulsa Pro is CE marked, Health Canada approved, and 510K cleared by the FDA. In the U.S., we employ a pure recurring revenue model for Tulsa Pro, whereby we charge customers around $8,000 on a per-procedure basis for Tulsa Pro consumables, lease of medical devices, and services associated with extended warranties. Outside of the United States, we also primarily deploy a pay-per-procedure model, but we also sell capital and consumables separately if the situation warrants that. We are also commercially utilizing Sondaleaf, an innovative therapeutic platform that is CE-marked for the treatment of uterine fibroids and palliative pain treatment of bone metastases. Sondaleaf is also being approved by the China National Medical Products Administration for the non-invasive treatment of uterine fibroids and has recently obtained FDA approval under a humanitarian device exemption for the treatment of osteoid osteoma. The business model for Sondaleaf Systems is currently a one-time sale of capital equipment. On the call today representing the company are Dr. Arun Manawat, Profound's Chief Executive Officer, and Rashed Dhawan, the company's Chief Financial Officer. With that said, I'll now turn the call over to Rashed.

Good afternoon, everyone, and welcome to our first quarter 2022 conference call. On behalf of the management team and everyone at Profound, I would like to thank you for your ongoing interest in our company. For those of you who are shareholders, We appreciate your continued interest and support. I will turn the call over to Arun in a moment for an update on our commercial activities. However, before I do, I would like to provide a brief update on our first quarter 2022 financial results. To streamline things, all of the numbers we will refer to have been rounded, so they are approximate. For the three-month period ended March 31, 2022, the company recorded revenue of $1.4 million, up 92% from $711,000 in the first quarter of 2021. Recurring revenues increased 115% from $477,000 in Q1 2021, while one-time equipment sales increased 45% compared to the $234,000 recorded in Q1 2021. Total operating expenses in the 2022 first quarter, which consists of R&D, G&A, and selling and distribution expenses were $7.7 million, an increase of 13% compared with approximately $6.8 million in the first quarter of 2021. Breaking that down further, expenditures for R&D increased 2% on a year-over-year basis to $3.2 million. This was primarily driven by captain trial enrollment, traveling for off-site MRI testing and site installation, and additional headcount. G&A expenses increased by 10%. to $2.3 million due to additional headcount, increased legal, accounting, and recruitment fees, increased travel as restrictions continue to be lifted, increased license costs of our enterprise resource planning and customer relationship management software. Finally, selling and distribution expenses increased by 39%, to approximately $2.2 million. Overall, the company recorded a first quarter 2022 net loss of $8.2 million or 40 cents per common share, compared with a net loss of 7.5 million or 37 cents per common share for the same three-month period in 2021. As of March 31, 2022, Profound had cash of $60.1 million. With that, I will now turn the call over to Arun.

Thank you, Rashed. Before I talk about our Q1 2022 achievement and outlook for the rest of the year, I'd like to provide a little more color on Rashed's financial discussion. Our installed base in U.S. has grown to 24 Tulsa Pro systems just shy of our goal of 25. And while we said on our last call that we thought some international one-time capital sales would start to trickle in the second half of this year, I'm pleased to report that those sales have already begun with approximately 340,000 worth of equipment sales recorded in Q1 2022. Our worldwide install base is now 30. We believe that the direct impact of COVID-19 has subsided with respect to our ability to access new US sites to install TELSA Pro systems. But we still see some lingering effects in the supply chain, primarily in the form of delayed deliveries of new MR units to the sites where we have TELSA agreements. The good news is that we expect this to eventually correct itself, and we are seeing the trend to increase utilization in our install base. Accordingly, independent of future installs, we continue to believe that the pace of utilization will accelerate meaningfully in the second half of this year as the newly installed sites get up their learning curves and increase utilization. While we are a medical device company, As you already know, we have chosen to charge on a per-patient basis in the United States for bundled services that include the use of our device, the one-time disposable, and the genius services that we provide to support cases. Because we deploy this unique business model in the U.S., we also want to clarify how we recognize revenues. We recognize no revenue upon installation of the Telstra Post system. We recognize part of the revenues upon shipment of the disposable and defer about 24% of the per patient revenue until the actual usage of the disposables or the treatment of the patient. We believe that this is a winning model as it creates a true partnership between us and the healthcare provider. In the first quarter of 2022, we continue to see that our physicians are using TELSA for whole-grain, partial-grain, or focal therapy and salvage cases. Two sets of significant data sets were announced. One was a publication on use of TELSA in patients who have had producial marker seeds in their prostate due to prior SBRT radiation treatment. The authors concluded that TELSA ablation was possible in these patients as long as certain precautions were taken.

The publication continues to enhance the proposition that TELSA is a safe modality for salvage patients. In addition, Dr. Ming recently reported

on 50 patients at UT Southwestern that received focal rather than whole-grain treatment with a variety of treatment plans, including partial-grain ablation of intermediate risk lesions, concurrent treatment of BPH along with lesions for men with BPH or lower urinary tract symptoms, near whole-grain treatment for men with multifocal disease and partial gland ablation of localized radial recurrent prostate cancer. Early outcomes show that at 12 months following treatment, PSA declines an average of 63% and prostates shrink an average of 19%. In terms of quality of life outcomes, Only six to eight percent of patients reported worsening voiding and erectile dysfunction, respectively, at six months post-treatment.

Notably, no recurrence of cancer has been reported.

Overall, UT Southwestern reported minimal adverse events with high rates of potency and continence preservation and again, the ability to treat a wide variety of prostate disease patients. These include those I just mentioned, as well as very large prostates, up to 260 cc, organ-confined high-risk cancer, and palliative cases to improve quality of life.

UT Southwestern's experience affirms that TELSAL

is the best way to implement focal therapy and can be used to treat malignancies anywhere within the prostate, which is just one of the ways that Tulsa helps customize treatment of the whole or the partial gland. UT Southwestern is one of the seven top opinion-leading US hospitals that are currently using the TELSA Pro system, and the study that they presented is an example of how we expect opinion-leading sites to adopt TELSA. They started first by cautiously analyzing the outcomes and feedback of their own patients, and now that they see promising results, they are on track to expand usage. Another significant development during the quarter was the confirmation of TELSA Pro's compatibility with GE, making the system compatible with the big three medical technology companies in the global MRI space, which comprise more than 90% of the installed base of MRIs in the U.S. This is an important achievement as it significantly increased are available opportunities. In addition to the agreement that we announced at Brigham and Women's Hospital, we now have two additional agreements for GEMR sites to be installed in Q3 this year. I would now like to turn to our sponsored CAPTN trial, which stands for a comparison of TALSA procedure versus radical prostatectomy, or RP, which treated its first patient in January and continues to progress. To date, seven sites have been activated and are currently recruiting patients with an expected total of eight or more sites in the United States and two sites in Canada. We remain on track to be able to finish enrollment in the second half of 2023 and anticipate the first readout of early data in Q4 2023. We remain on track to be able to finish enrollment in the second half of 2023 and anticipate the first readout of early data in Q4 2023. We also continue to await full data on the FARP trial whose robotic RP arm is similar to that of our CAPTEN trial. FARP is a single site level one study conducted at Oslo University Hospital that compared old-land RP to focal therapy using either HIFU or TELSA. Should the RP outcome in CAPTEN match what was seen in SARP, we believe there is potential to demonstrate clear superiority even though the CAPTEN trial has been designed with a non-inferiority endpoint.

Broadly speaking, we are conducting the CAPTEN trial to increase awareness and adoption of TELSA Pro as well as to support coverage by peers.

To further support the first part of this goal, Profound will be very much front and center at the American Neurological Association meeting in a few days. Indeed, as many of you know, a semi-live TELSA case will be presented during the plenary session. We are limited in what we can say ahead of that, but you should expect us to provide more details closer to the event. As for our ongoing reimbursement strategy, our TELSA systematic review paper that was published online in March by the Journal of Endourology completed the clinical requirements to qualify to file a CPP-1 application. It also provides the highest level of evidence available in support of TELSA. In this case, level 2a demonstrating that TELSA is safe and effective for treating primary prostate cancer, recurrent prostate cancer, and locally advanced prostate cancer, as well as the simultaneous treatment of prostate cancer and the lower urinary tract symptoms normally caused by BPH. Having met the clinical requirements for filing for a CPT code, we remain on track to file the application by end of June, which is fast approaching. This application will be up for consideration at the AMA's fall 2022 meeting, and if approved, the CPT-1 code

would be effective in January 2024.

To summarize, to date, well over 2,000 TELSA procedures have been performed by more than 100 physicians, and we anticipate that this number will continue to increase as the new install base begins to ramp treatment. We also see more activity in the international market as the year progresses as a few one-time capital sale projects are revived.

As a result, we anticipate higher recurring and total revenue growth for the remainder of the year. We are pleased to see the clinical data presented recently

by UT Southwestern as it established that Tulsa is the best way to perform focal therapy. Tulsa continues to be unrivaled in its flexibility to provide whole gland, partial gland or focal, or salvage ablative treatments in any size or region of the prostate. We are seeing early indication that Tulsa's compatibility with all three major manufacturers of MR scammers, GE, Siemens, and Philips is increasing our market access. And we continue to be on track for filing our CPT-1 application for Tulsa Pro this June. This ends our prepared remarks for today. With that, Rashed and I are happy to take any questions you might have. Operator.

Thank you. We will now be conducting a question and answer session. As a reminder, to ask a question, you will need to press star one on your telephone. To withdraw your question, press the pound key. Please stand by while we compile the Q&A roster. This question comes from Raul Sargazer with Raymond James. Your line is open.

Good afternoon, Arun and Roshad. Thanks so much for taking our questions. So looking at first at the revenue, recognizing that about a million of it was recurring and we saw about a million dollars last quarter of recurring. And given that you're now at 24 installed devices, you're very close to your target. Could you give us a sense for how the utilization rates are balancing the provide for that sort of essentially similar recurring revenue quarter over quarter, and how should we be thinking about those utilization rates hopefully increasing to drive that number upward?

Sure, Raul. Good afternoon. Yeah, so the recurring revenue in Q1 is primarily on the original install base. The impact of the recurring revenue or the number of patients treated in the new install base is still relatively limited. And as I mentioned in the prepared remarks, we defer a good bit of even if we have shipped disposables, we still defer a good bit of revenue until the patients have been treated. So it is higher, actually about 5-10% higher than last quarter and I know in rounding off it may not show up as much, which is fine. But the way I see this, as I've mentioned in prior calls, we are building opinion-leading sites, and I think that UT Southwestern is an example where these sites start cautiously, we're still a new technology, and then they will grow over time. And so I think To answer your question, first question, the revenue is primarily coming from the original install base. And number two, I think, as I said in the last call, I think you should expect at least doubling of those by end of this year or maybe sooner because this install base will now produce revenue. And you will see impact in Q2 also, but you'll definitely see significant improvement in the second quarter. as these sites, you know, do their first cases in a very cautious way, and then they start to expand usage over time.

Perfect. That's very helpful. Thank you very much, Arun. And so you started referring to the installed base growing through the remainder of the year. So could you please give us a sense for how the funnel looks for the remainder of 2022? Yeah.

So, you know, we have, you know, still have at least another 10 agreements that we have not installed in addition to what we have done. And as I mentioned in the prepared remarks, some of these delays relate to the fact that the sites where MRIs already existed and the hospitals were bottlenecked, those are behind us and we're able to place the systems in their but there are at least four sites where they had ordered new MRIs, and typical delivery of these MRIs are running about six months behind schedule. So I think that as those MRIs come in, we should be able to continue to see an increase in the rest of this year, and we'll see at least another 10 or so this year.

Great. That's very helpful. And then if you don't mind, I'll just ask one more question. Recognizing that the FARC trial should hopefully read out sometime this summer, and we're looking forward to those results, do you have a sense for whether on the CAPTN trial we may be able to anticipate some interim readouts before the 4Q23 readout that you outlined? And that's all for me, and I'll get back into you after this.

Sure. Yeah, Raul, most certainly I think the FAR trial should read out in July, August this year. And I think that the capping trial is not blinded to us. It is randomized, but because it's a device, it is not blinded, given that one patient will undergo A prostatectomy, the other one, we're going to go test that. It's hard to, you know, blind. It's impossible to blind it. So if we were to stay completely loyal to the level one concept, we would have to wait until all patients are treated. However, you know, and I think we will certainly defer to the trial coordinators and the lead authors ultimately. But I do think that Given that this is more about adoption and about coverage, if the opportunity presents itself, we will certainly look to do that. The worst case is Q4 of 2023. But I hear your point, and I think certainly we will discuss it with the investigators who are conducting the trials.

Okay, great. Thank you very much, and best of luck for the next quarter.

Thank you, Rune.

Our next question comes from Frank Takanan with Lake Street Capital. Your line is open.

Hey, Rune. Hey, Rashad. Thanks for taking my questions. Just a couple from me today. I wanted to start with the commentary around capital equipment sales, and how should we be thinking about that sequence? I know I heard your comments about some came into the model. And then it sounds like there's a good chance of a ramp in capital equipment sales in the back half of 2022. So any color there would be greatly appreciated.

Yeah. You know, I think a year or two ago, people used to go, you know, you have a pipeline and you're going to come back. and are you losing that pipeline, we are seeing that the pipeline did not really disappear and that it is actually coming back. So with the exception of China and to some extent Japan, the pipeline that is Europe and U.S., we are selling some systems of sonolive in U.S. as well because of the research work that is going on in a number of areas, I think that pipeline does look very good. And so I think that certainly our primary business is still going to be with building the recurring revenue, and our UF team is 100% focused on that part of the business. But I am hesitant to give you a specific number, but I can tell you that I'm more optimistic today than I have been in the prior quarters, I think you will see, for example, more capital revenue even in Q2 as compared to Q1. And I think what we'll do is try to give you color of the following quarters instead of giving you the long-term yet. So I certainly think that Q2 is going to be better even on that side of the equation compared to Q1.

Got it. Okay. That's helpful. And wanted to swing back to utilization and ask a little bit more specific on that. I think we got a lot of the elements, but wanted to ask a little bit more directly. If I remember, there was kind of a 40, 60, 100 concept, maybe 40 procedures annualized in the first six to 12 months, some power users doing 60. And then at scale, there was a potential and thought that you could maybe hit 100 procedures once fully folded into the organization. Is that still an accurate way to think about that? And how have you been seeing that trending with your initial placements in 2022 so far?

I think generally speaking, Frank, the way you described it is still the accurate way of looking at it. And I know everybody is anxious to see how quickly we ramp, and I think that will happen. And again, as I described the UT Southwestern on purpose as a case example, where they were very slow in the very beginning, and then they started to see the feedback from their patients, and they started to see that cancer was not coming back. And now I think they will expand to that run rate, the 100 run rate, certainly by second half of this year, I think they will expand to that revenue run rate. So that original kind of hypothesis is generally intact. You know, it might be off by 5 or 10%, but I think generally it is intact.

Okay, perfect. And then if I could just squeeze one last one in here. Of the 24 systems that you have installed to date, what's the mix of those that are just standalone Tulsa versus introduced alongside a broader prostate cancer treatment program, whether that's DaVinci or... radiation specifically, just trying to get a feel if there's some stand-alones or if they're mostly an add-on to broaden the offering at a specific clinic?

I would say pretty much the majority of them are in hospital systems where they are adding on. And probably 80% of them are in hospital systems. That's a very good question. And we are, as you know, also evaluating how the feedback from patients and how many patients are actually asking for TELSA by name. And we are also continuing to see significant increase in that number. number of patients were asking for TELSA. So the number of hospitals are certainly getting the message that they need to be able to offer TELSA in addition to what they offer today.

Got it. Okay, that's helpful. I'll stop there. Thanks for taking my questions and congrats on all the progress. Thank you, Frank.

Thank you so much, Frank.

Our next question comes from Josh Jennings with Kaplan. Your line is open.

Hi. Good evening. Thanks for taking the questions. Good evening. Good evening. I was hoping to ask just about the sales funnel. I know you had some commentary and you're seeing some momentum, increased demand, but I was hoping that you may be able to give us a little bit of color on the different channels that your team is pursuing, the entrepreneurial urology channel, the imaging center channel, the academic medical center. Are you seeing a differentiated level of demand or success from your sales team in either of those channels? It seems to be broad-based, but I just wanted to check in on that and get some incremental intel.

Josh, that's a great question. First of all, I agree with you. At the high level, there's interest in all of the channels that we've talked about historically. The imaging center, I think, has been a little bit of a challenged space because they, you know, during this period, they've basically sort of stayed true to their core part of their business. But I do think that in the next three months to six months, you will actually see imaging center channel actually starting to produce quite nicely. and we do have at least three or four systems going into the imaging centers, but the ones that we've put in in the last quarter or two have been more heavy towards the hospital settings. And I think, I mean, one of the things that we are very confident of is patients want this product, and they are willing to pay for this product. And I think the imaging centers, because they are only cash pays, as compared to hospitals where they do use the C code. The imaging centers have been a little bit cautious during this time. But I think that word is pretty clear that patients are willing to pay. And so you will see our thesis with respect to those channels really starting to blossom by the second half of this year.

Excellent. Thank you. And just thinking about the per-procedure revenue that Profound is capturing, have there been any changes? I think you talked on the fourth quarter call about a little bit of a lift potentially, but where does that stand now, and how have your customers in each of those channels been responding to the current, I guess, per-procedure rate that Profound is charging?

Yeah. So we are a great venture. now are typically in the range of $8,300 to $8,500. So there's a little bit better than $8,000. And there is, I mean, first of all, we do not offer any other option. That is the only option. And we do not discount on any site, for any site. So there is a phenomenal consistency in our purchase agreement and our contracts. And that is one of the disciplines that we started with and we plan to stay with because we think that it is a hard way to build a business that we're doing, but it is working and it will, over the long haul, keep our business fairly, fairly simple. And that's one of the things we're looking for. And we are increasingly seeing that the hospitals and the imaging centers are not pushing back against this concept.

Excellent. And last question is just I know you announced way earlier in the year about the hiring of Ken Knudson as the chief commercial officer. But just wondering if you could help us understand he is a veteran in the med device space like yourself and Just wondering if you could share any kind of early impacts that he's having on the commercial operations at Profound. Appreciate you taking all the questions.

Thank you, Josh. I am very proud of Ken. I'm thrilled with the way he joined us in January, and he spent his first several weeks really getting to know our product and the team. He's already been able to bring A couple of other seasoned executives have already adjusted our sales team to really focus on utilization. And later this week, in fact, you will see the AUA meeting we have coming up. I think you will see a significant presence from our company. and it's related to the upgraded sales and marketing team. So you will definitely see significant impact of the team that we've brought in and particularly Ken.

Understood. Understood. Thank you so much.

Thank you. A reminder to ask a question at this time, please press star then one. Our next question comes from Scott McAuley with Paradigm Capital. Your line is open.

Hi, gentlemen. Thanks for taking the questions. I just wanted to kind of follow up again on the pipeline. I was looking at the recent deck that I think you presented at the Bloomberg conference. And you kind of specifically mentioned there's about 15 additional POs in place for new systems to go in. I think you just kind of mentioned that you have kind of signed contracts for about 10 new systems to kind of go in through the rest of the year. I just wanted to kind of dig into that delta, kind of how you define purchase order versus signed contract, and again, kind of what we should be expecting for the balance of 2022.

Sure, Scott. It's not a major issue. It's just that some of the agreements we have are for multiple sites. and not every one of those would be installed in 2022. You know, it's possible in Q4 that we would accelerate, but I think at this point we're kind of feeling like we could probably get to 10 more this year. But certainly in terms of the agreements, we have multi-sign agreements now in place, and so that's where that difference is.

Got it, got it. No, that definitely helps. And then on the reimbursement side, obviously, you know, upcoming potentially to filing that application and for consideration potentially in the fall. Do you know kind of when the results of that kind of AMA consideration would be made public kind of in advance of it potentially coming into effect kind of early 2024? Yeah.

Yes, Scott, we're very excited about that potential. We have had reviews with the society and we believe we will have support from them. So there are a number of milestones. The first one is we will file by end of June. And so at the next endless call, we will announce the status of that milestone. The AMA meeting is I believe on the 27th of September. And that meeting is a public meeting. Typically, you will be able to hear support and so on. And typically, if there's a major problem, you'll know on that day. But the official announcement is typically about six weeks after the meeting. So in any event, by middle of November, we will know if we have the code or we do not. So and then for after that, it's just a cookie cutter stuff that just goes on for the following six to nine months. And then by the following September, you will know what the RVUs are announced. And thereby we'll have an idea that if it is covered what the payment will be. So September, we'll know kind of unofficially if there's a problem. November, we'll know if it's approved. The following September, we'll know what the likely payments are likely to be associated with it. So that's the milestone. Scott, I wanted to take one more minute. As I said, I'm very excited about it. And I do think that we are actually one year ahead as compared to what we originally thought. But I also don't want to undermine the fact that what gives us this confidence and why we're being so disciplined in the way we are approaching this market is that patients are willing to pay. So we do continue to see increase in utilization, increase in recurring revenues, even during this period. And most certainly, we think, obviously, CPT-1 is a very, very big step for any company. But we do feel that even without that, we are going to show you increased utilization and increased number of sites.

Absolutely. That's great. Thanks for spelling that out. And just lastly, for me, in terms of costs, in terms of you know, increased sales and marketing costs as you're kind of retooling the team and R&D costs with Captain. Just kind of any color on how you expect kind of the cash burn to increase kind of in the coming quarters.

Yeah. So I think as you saw from Rashed's comments, Our R&D costs are fairly level at this point. There will be incremental increases because of capping, but not materially significant. Overhead costs are likely to be fairly stable also. The investment, as again, as Rishabh mentioned, we made into putting the electronic systems or ERPs and CRMs and so on is also pretty much behind us and we'll have maintenance cost for those things going forward. So the primary increase that you see in our cost side is all in the sales and marketing and we will grow that as the install base grows. And so I think mapping it kind of linearly to how the recurring revenue install base grows is probably fair to think about. and i i don't anticipate you know i i know our revenue total revenues are pretty low but as you get to the the you know a little bit higher revenue run rates which i do believe we will this year later this year i don't i think you will actually start to see the burn a little bit less than what it is at the moment so we are really conscious of the burn also and i don't think you should expect that our burn will continue to increase. I think it will be pretty much stabilized by the second half of this year. And then hopefully next year we'll start to see some improvement.

I think that's what we have said, Varun, so thank you for clarifying. As you can see, even for Q1, R&D was only 2% year over year, right? So we are not expecting R&D to increase significantly. And capital trial, as Warren has indicated before, is spread out over a longer period of time. So we'll see that the expense is not going to significantly increase for selling and distribution. It will be adjusted as we see fit based on the revenue ramp up. So overall, the barn rate we still expect to be similar to last year.

Fantastic. Thanks, gentlemen. Thanks for taking your questions.

Our next question comes from . Your line is open.

Very close. Can you guys hear me okay?

Yes, Brian, please.

It seems as if the number of new contract signings is continuing to outpace your installations. What are you guys doing to prepare for a higher level of installations throughout the balance of this year? and as you progress into 23? Yeah.

Brian, the number of contracts, certainly the bottleneck at the moment is in the new MR installation. That's really where the next bottleneck is for us. But with respect to our ability to install, we can really, we have the ability to do twice as much as what we're doing at the moment. We've done pretty well on that end. And our focus actually, to be honest, is right now, our primary focus is really on getting the new sites as fast as possible. So I don't think you will see a bottleneck from us on the installation side. I think it is more on the MR installs. I think where our sales team is really focused is on getting the utilization of the current sites going. I don't know if I answered your question completely or not. If I didn't, please ask me again. Brian, can you hear me?

And it looks like we've lost Brian. I would like to turn the call back over to Dr. Minowat for closing remarks.

Thank you so much, and we look forward to updating you at the Q2 call. And if any of you are at the AUA conference, please stop by at our booth. We have a lot to share at the booth. Thank you so much.

Thank you. Please stop participating even now. Disconnect.