HeartBeam, Inc. (BEAT) on Q3 2022 Results - Earnings Call Transcript
Operator: Greetings, and welcome to the HeartBeam Third Quarter 2022 Financial Results Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. As a reminder, this conference is being recorded. Before we begin the formal presentation, I would like to remind everyone that statements made on the call and webcast may include predictions, estimates, or other information that might be considered forward-looking. While these forward-looking statements represent our current judgment on what the future holds, they are subject to risks and uncertainties that could cause actual results to differ materially. You are cautioned not to place undue reliance on these forward-looking statements, which reflect our opinions only as of the date of this presentation. Please keep in mind that we are not obligating ourselves to revise or publicly release the results of any revision to these forward-looking statements in light of new information or future events. Throughout todayâs discussion, we will attempt to present some important factors relating to our business that may affect our predictions. You should also review our most recent Form 10-K and Form 10-Q for a more complete discussion of these factors and other risks, particularly under the heading Risk Factors. A press release detailing these results crossed the wires this afternoon at 4:01 p.m. Eastern Time and is available in the Investor Relations section of our companyâs website, heartbeam.com. Your host today Branislav Vajdic, Chief Executive Officer and Founder; Jon Hunt, Chief Business Officer; and Rick Brounstein, Chief Financial Officer, will present results of operations for the third quarter ended September 30, 2022. At this time, I will turn the call over to HeartBeam Chief Executive Officer, Branislav Vajdic. Please go ahead.
Branislav Vajdic: Thank you, operator, and good afternoon, everyone. Iâm pleased to welcome you to todayâs third quarter 2022 financial results conference call. I could not be more enthusiastic about the future of HeartBeam, the rapid pace of our product timeline and our teamâs ability to scale our commercialization path. For those of you joining us for the first time, Iâd like to take a moment to introduce HeartBeam and our opportunity in a short video introduction. The video explores the HeartBeam AIMIGo technology need market opportunity and use in heart attack detection. AIMIGo is the first and only credit card sized 12-lead ECG device for remote heart detection with a 510(k) regulatory pathway. While weâre playing the video for our dial-in participants unfortunately, itâll be about three minutes of silence, but Iâd like to remind you that the video is available on our website heartbeam.com. Today, there are many ECG technologies offered to consumers and patients outside of a medical facility. What they all have in common is that they do not offer a standard of care 12-lead ECG. That means that they are not capable of detecting a heart attack. In the great majority of cases, it is a single lead ECG that may be adequate for some arrhythmias but is certainly not capable of detecting a heart attack. So shown in this slide is the actual message from Apple Watch warning the user of its inability to detect the heart attack. Similarly, a live core with their cardiac products prominently feature on their website the same disclaimer about the inability to detect the heart attack. Our technology we believe has solved the problem of heart attack detection outside of a medical institution. The HeartBeam technology is intended to quickly and accurately help clinicians identify a heart attack. This could reduce the critical time to intervention for heart attack patients, saving lives and reducing healthcare costs by ruling out a heart attack and reducing the number of emergency room visits. Our third quarter was highlighted by progression on our commercialization pathway toward the series of important milestones including the 510(k) application submitted for HeartBeam AIMI product. As we look forward, FDA clearance for HeartBeam AIMI, we are also making significant progress with our core product, the AIMIGo 3D VECG collection device as we prepare for FDA submission in late Q4 of this year. During the â this quarter, we broaden the product portfolio to enable smart watch connectivity to HeartBeamâs platform in future products as an option of monitoring solution for the clinician and their patient. We further advanced intellectual property protection during this quarter with two new patents, a patent for a 12-lead ECG patch monitor intended to â for detection of heart attacks and complex cardiac arrhythmias opens a pathway to offering ischemia and arrhythmia detection via an ECG patch. This innovation builds on our growing intellectual property portfolio enabling 12-lead ECG diagnostics outside of a medical setting. The technology offers the potential to bring a level of agnostic accuracy consistent with the current 12-lead ECG standard of care and could have a disruptive effect on the established multi-billion dollar ECG patch market with its ischemia detection capability. A second patent that enabled generation of a synthesized 12-lead ECG by our AIMIGo credit card size device opens a pathway for a patient to record a set of signals using AIMIGo outside of a medical setting with the agnostic synthesized 12-lead ECG immediately transmitted to a clinician for review and diagnosis. This ECG format is one that clinicians are trained to interpret with the added benefit that by including a second recording of a patientâs baseline ECG, it is personalized to that individual and we expect that weâll provide added data to assist a clinician in the diagnosis. We expanded the availability of patient population for our HeartBeam AIMI software platform to include unstable angina is a diagnosis actually for analysis and provide access to a broader patient population for technology once cleared by the FDA. Most recently, we announced the appointment of Dr. Peter Fitzgerald, a Chief Medical Officer. Peter is a renowned Stanford University Cardiologist who brings deep clinical research and industry experience to our executive team and is one of the most preeminent opinion leaders in cardiology and digital health. We expect that he will play a major role in defining best paths to adoption, clinical strategies and partnerships to advance our products and markets. We are also privileged to welcome Ken Persen to the role of Chief Technology Officer to lead overall Technology Strategy and Development of the HeartBeam AIMI and AIMIGo platforms. Ken has over 25 years experience in the Digital Health Care and Cardiac Devices Industries. Most recently, he founded the Digital Health Company a little more where he served as Chief Technology Officer. I would now like to turn the call over to Jon Hunt, our Chief Business Officer to further discuss our products and commercialization paths. Jon?
Jon Hunt: Thank you, Branislav. Turning to our product timelines and updates, we had several key developments related to our HeartBeam AIMI and AIMIGo platforms. As Branislav mentioned, we announced the 510(k) submission of our HeartBeam AIMI platform to the FDA, we received questions from the FDA within the statutory 30-day review deadline, discuss the questions by a teleconference with the FDA review team and provided written responses addressing the questions to the primary reviewer. The substantive review is in progress and we expect to receive FDA clearance in the fourth quarter followed by a limited market release in Q1 of 2023 and full commercial rollout in Q2 of 2023. We expanded the addressable patient population for the HeartBeam AIMI software platform to include unstable angina as a diagnosis for analysis and provide access to a broader patient population for technology once cleared by the FDA. It is important to include unstable angina as a diagnosis for analysis, as it is a frequent occurrence in patients presenting with chest pain. Patients with unstable angina may have subtle electrical changes brought on by ischemia without definitive injury to the cardiac tissue. We engage multiple partner health systems and they provided the needed ECG data to complete our clinical trial that was part of the FDA submission of our HeartBeam AIMI software product. After this, we have plans for additional pilot studies for our end-to-end prescription only AIMIGo system for remote heart attack detection in at risk patients, as well as other future scientific and commercial collaborations with these health systems. HeartBeam AIMI is software as a medical device solution for use in acute care settings with market clearance via the 510(k) regulatory pathway and our first target will be emergency departments, where this will be a software licensing business model on a subscription basis of an average cost of $100,000 per year per emergency department. In high volume emergency departments, weâve discussed this with this turns out to be about 85 patients per day that go through the emergency department requiring a 12-lead ECG, so it works out at an amortized cost of between $3 to $4 per use. There are 5,000 emergency departments in the U.S. with a total addressable market of about $500 million. The HeartBeam AIMI solution is a web browser that slots into the existing workflow of an emergency department leverages existing 12-lead ECG hardware and provides the attending physician a diagnostic suggestion with an instant comparison of the patientâs baseline and symptomatic ECGs for their consideration in the patientâs diagnosis. Quickly determining if a patient needs intervention or needs to be held in the ER for further observation or can be discharged helps the EDS manage throughput. To-date, HeartBeam has completed three key Harvard design studies in Europe. The study shown in this slide demonstrates the accuracy of the HeartBeam algorithm. It outperformed the panel of cardiologists in detecting a heart attack. The data showed the HeartBeam algorithm was agnostic to the physical location of the occluded vessel compared to cardiologist whose performance declined in occlusions in both lateral and posterior vessels. Briefly, the total addressable market for the AIMI software solution, as I just said, is approximately $500 million and compare that to the AIMIGo Technology platform we anticipate this to be about a $10 billion market and these are estimated numbers for the U.S. market alone. Turning to our AIMIGo product, we expanded our product portfolio pipeline to serve the growing cardiac device wearable technology market by bringing clinically relevant diagnostic information to patients and clinicians with smart watch connectivity enablement supporting a daily multi-hour heart monitoring solution. In September, we were granted a patent that provides additional intellectual property protection for our AIMIGo Technology offering, 12-lead ECG capability in the form of a credit card size device with the same footprint as the single lead products currently in the market today. This was quickly followed by the granting of a patent for a 12-lead electrogram patch monitor intended for detection of heart attacks and complex cardiac arrhythmias, building upon HeartBeamâs intellectual property portfolio, enabling 12-lead ECG diagnostics outside of a medical setting. We engage Silicon Valley based Triple Ring Technologies, a co-development engineering company to assist in the design and development of our AIMIGo complete solution 3D vector ECG collection device for remote heart attack monitoring. Triple Ring has a long history of successfully designing a wide variety of innovative medical devices and underlying technologies and weâre now working closely with its medical device team to rapidly build and test our 3D ECG device. This joint partnership is a five phase expedited device development project scheduled to be completed in the fourth quarter of 2022 in time for our 510(k) submission to the FDA. The AIMIGo product incorporates the hardware design and development efforts of Triple Ring and our software firmware and remote patient monitoring platform development efforts. Engaging Triple Ring for the hardware development of the AIMIGo 3D ECG device to plug into our RPM platform, allows the company to provide an end-to-end telehealth solution for patients and physicians. An added benefit of the partnership with Triple Ring is that they have an established relationship with an OEM manufacturer who is able to manufacture the AIMIGo 3D ECG device at scale. In addition, the OEM manufacturer is capable of handling logistics and distribution for their customers. By engaging experience development partners like Triple Ring HeartBeam management is confident, weâll meet our project timelines for late Q4 2022 FDA submission and are in active discussions with Triple Ringâs manufacturing partner to support a limited market release of the AIMIGo product in Q2 of 2023. HeartBeamâs AIMIGo product is a 510(k) regulatory pathway. We have already identified a predicate device to demonstrate substantial equivalence with a simple validation study. Importantly, the clearance of the Gen 1 device allows HeartBeam to collect 3D vector cardiogram data and use these data for developing advanced features for a Gen 2 product. HeartBeam AIMIGo has a clear reimbursement pathway with existing CPT Codes and these are highlighted on this slide. Weâre planning on using a subscription model, where HeartBeam builds a practice on a per patient per month basis. And the discussions my commercial team have had with the cardiology practices indicate this is an attractive business model, because they can use existing codes and it provides an enhanced level of care for high risk patients that they currently do not monitor. Looking at the average monthly reimbursement per practice per patient is approximately $1,300 per year per patient or about $110 per month based on average reimbursement cost in the U.S. And HeartBeam will build a practice a technical fee of $50 per month per patient or $600 per year. Again, this is to monitor a currently underserved high risk patient population that until now weâre not able to be easily monitored outside of a medical facility. This is also expected to provide a new revenue stream for a cardiology practice. We estimate that our share of this revenue stream, i.e., the technical fee is about $10 billion a year in the U.S. market alone. This slide shows several companies in the cardiac monitoring market that you are very familiar with. While each product offers some of the capabilities of the HeartBeam telehealth product, the 12-lead ECG capability, integration of patient history and symptoms, and the presentation of comparative ECGs, providing a baseline and symptomatic ECG to the physician, differentiate the AIMIGo device significantly from other products in the market. We believe HeartBeam AIMI and HeartBeam AIMIGo by leveraging our patented 3D vector ECG technology offer substantial capabilities beyond existing offerings and we continue to engage with potential customers and partners in anticipation of FDA clearance and commercial launch for our products. It is important to note while a live course credit card sized cardio mobile product recently introduced and shown on this slide is only a single lead ECG recording and does not contain the vector information recorded by the AIMIGo device. I will now turn the call over to Rick Brounstein, Chief Financial Officer to discuss operational updates and financials.
Rick Brounstein: Thank you, Jon. I would like to briefly discuss our sample financial model at scale for our for our HeartBeam AIMI and our AIMIGo solutions, which shows that capturing even a modest percent of our total addressable market results in the significant reoccurring revenue base. The existing insurance codes that Jon just reviewed previously are going to drive the AIMIGo revenue. This telehealth is a much larger market, probably about 20 times or so our market opportunity compared to this side of the ED market and over time we expect that it will be the primary source of revenue. I would also like to highlight that our solutions also generate high gross margins under either base case assumptions with gross margins above 80%. And finally as the company scales, operating margins can be in excess of 30% even as we increase investments in R&D. As R&D opportunity is most evident by taking a look at our platform technology and what weâre doing with it today. Turning to our financials. I will now give us a sync review of our financial results. A full breakdown is available in our regulatory filings we just issued the 10-Q for the quarter and in the press release that just cross the wire after market closed today. Our third quarter 2022 financials are the last comparing HeartBeamâs results as a private company in 2021 to now a public company working on the commercialization of our first two products. Research and development expenses for the third quarter of 2022 were $1.6 million compared to $105,000 for the third quarter of 2021. Our focus on R&D consisted largely of product development costs for HeartBeam AIMI, which is now essentially done and also HeartBeam AIMIGo. This includes both software and hardware, the latter with our professional service agreement with Triple Ring Technologies to assist in the hardware for AIMIGo. Additionally, there are clinical costs and support of our FDA submissions for both our products this year as well as research costs and support of future product pipeline coming from our patented vector 3D ECG platform technology. General and administrative expenses for the third quarter of 2022 were $2.0 million, so 2 million even compared to $341,000 for the third quarter of 2021, reflecting the growth in our team and other costs in support of being a public company. Interest income during the three months ended September of 2022 of $28,000 is related to the cash balances from the last November IPO. In 2021, we had $608,000 of expense tied to the 2015 convertible notes that converted into and added to the common stock as of December 31 of 2021. Net loss for the quarter â third quarter was $3.6 million compared to a net loss of $1.2 million for the third quarter of 2021. We ended the third quarter of 2022 with $6.5 million in cash and cash equivalents compared to $13.2 million as of the end of December 31, 2021. We expect our cash position to provide a runway into 2023 and the expected FDA submission in Q4 of this year as well as the clearance of HeartBeam AIMIGo next year. Iâll now turn the call back over to Branislav for his closing thoughts.
Branislav Vajdic: Thank you, Rick. Indeed, our technology is a true platform technology. So far, we have developed two products that are going to the process of either already submitted to the FDA in the case of HeartBeam AIMI or soon to be submitted to the FDA for the HeartBeam AIMIGo product. During the third quarter, we continued to operate from a position of strength equipped with strategic partnerships to advance product development, near-term milestones and cash runway into 2023. Looking ahead, we are accelerating our commercialization path in remain confident in our anticipated upcoming product milestones. By the end of this year, we expect to receive FDA clearance for our HeartBeam AIMI platform and we expect to have our HeartBeam AIMIGo solution submitted to the FDA for clearance. We approach these milestones from a position of strength with an experienced team bolstered by recent appointment of Dr. Peter Fitzgerald as Chief Medical Officer, and Ken Persen is our Chief Technology Officer to support these goals. Beyond that, looking at the product pipeline, we think that the application of our artificial intelligence will be of great value to us. We will have very unique dataset of patients with actually have recorded ECG on a daily, weekly or monthly basis. That longitudinal data for our patient population will be of tremendous value. Applying artificial intelligence to these sets will be extremely valuable. It is extremely data reach set much richer than the standards 12-lead ECG. Additionally, insight that we will gain by applying artificial intelligence will help cardiovascular population with predictive and preventive value we believe. On the lower right portion of this slide, it shows the 12-lead patch. We have recently received a patent for that essential tool for the physicians and it is a unique patch in this category of a market thatâs growing and is projected to be at $4.8 billion by 2030. This is a disruptive technology that has the potential to have a significant influence on the patch industry as a whole. Iâd like to share one final thought. We are all very excited about the prospect of helping millions and millions of cardiovascular patients, initially heart attack patients, but we believe our technology will essentially address all cardiac patients and all disease, cardiac disease that are detectable by a 12-lead ECG. So thatâs very exciting prospect for all of us and a great motivator to be helping many, many millions of patients throughout the world. I look forward to providing our shareholders with further updates in the near-term as we move forward towards commercialization. I thank you all for attending and now the HeartBeam team would like to answer any questions. Operator?
Operator: Thank you. Weâll take our first question from the line of Jason Kolbert with Dawson James. Please go ahead. Your line is now open.
Jason Kolbert: Hi guys. Congratulations on all the progress. Iâd like to hear you talk a little bit more about the overall commercialization plans as approval becomes a reality and you start getting into raising physician awareness and really driving this product, both AIMIGo and the entire platform. Thanks.
Branislav Vajdic: Jon, please.
Jon Hunt: Hey, Jason. Yes, thank you. Well, obviously weâre already in the discussions now with some pilot sites for anticipating HeartBeam AIMI. One of the things the commercial team wants to do with a few pilot sites weâve already identified is to evaluate the product in terms of how it slots into the clinical workflow and gets some early feedback from those users. Weâve identified some very prominent physicians in the emergency medicine space to help us in that effort. And once weâve characterized that, then weâll expand the commercial footprint. But as Iâve said previously, initially with a small commercial team, weâre going to focus on accounts that are regionally based to the â where the folks are located in the HeartBeam team. And thatâs in these following metropolitan area, Charlotte, North Carolina; Atlanta, Georgia; Minneapolis, St. Paul; Denver, Colorado; and Seattle, Washington. So itâll be a small footprint initially to gain traction. And then as we get traction with the product, weâll expand the commercial team footprint. With AIMIGo, weâve already got a lot of interest from some of those same centers, because weâre finding in fact, I know one of my staff just had a discussion today with a major academic center in the Seattle region, where weâre bringing cardiology and emergency medicine together, because we think long-term thereâs a possibility that AIMIGo will get prescribed not just by cardiologists who follow these high risk patients, but also out of emergency departments by physicians that are often discharging up to 80% of patients that present with chest pain. They get diagnosed for a non-cardiac reason, and then theyâre cycled back into cardiology, because obviously it was chest pain that brought them into the center. And a lot of emergency physicians weâve spoken to, like, the idea of actually giving a device to a patient as they discharge them, because currently theyâre just discharge them with the promise that theyâre going to get a cardiology follow up call, which as you know based on scheduling can take anywhere from on average six to eight weeks. So doesnât necessarily make the patient feel well.
Jason Kolbert: Yes, it makes sense. Sounds like a veryâ¦
Jon Hunt: Thatâs important, right.
Jason Kolbert: Right. Sounds like a very pragmatic paced launch and a lot of planning sounds like itâs gone into it. Can you also Branislav talk a little bit about what the interaction was like with the FDA? You turned around the written response pretty quickly, did â were there questions kind of just â were there any real big surprises there or was it pretty routine and whatâs your confidence level given that interaction on where you stand now? It sounds like itâs pretty high.
Branislav Vajdic: Yes. Thank you Jason for the question. I will comment and also as Jon who has been very close to that process to comment as well. So far we have not seen any surprises. We have received a set of questions, we responded and actually spent half an hour with the FDA team, basically put in a little bit more detail around our response and that went well as far as we can tell. At this point, we are waiting for the next step here. We really donât know what the next step will be, but at this point, we are confident that the clearance will come this year. Exact timing is impossible to say, right. And the FDA has been under a lot of stress, in terms of tail end of COVID, et cetera. So we really donât know exact action â final action by the FDA, but the optimistic and we believe that thatâs going to be for sure this year. But Jon maybe additional light from you.
Jon Hunt: Yes. Well, one, I think Jason was the â we got questions back from the FDA. I think some of them as is typically in the experience Iâve had previously is that sometimes itâs just a misunderstanding on the reviewers part of the â review teamâs part, right. And I think we had a couple of those questions, which we dispositioned on the phone call. But then we wanted to provide written responses, which we turned around quickly, because thatâs just my preference in dealing with the FDA. You never sort of show indifference to responding to their question. I think the promising thing from my standpoint was that they were very responsive in hosting a conference call with us, and the reviewer pulled the entire team together. And we had interactive dialogue with them, said we were going to provide both minutes to the meeting, which obviously FDA reviews along with responses, and now itâs under substantive review. I think as youâre all aware, FDA is still working remotely. Itâs post COVID. Theyâve been hammered during COVID, obviously, itâs the fact that theyâve kept up with this and met their statutory timeline on the initial review was promising from my perspective. But as Branislav said, very difficult to try and pin them down to when theyâll get done with the substantive review or those getting close to year end. And I know they have a tendency that they want to close out. Submissions that are already in the queue and under review and Iâve experienced that previously as well. So very positive from my perspective.
Jason Kolbert: Yes, very helpful. I appreciate that color. And by the way, thank you for laying out the milestones so clearly as you did in the press release. Itâs refreshing to see that. Thank you so much.
Branislav Vajdic: Thank you for your questions, Jason.
Operator: Weâll take our next question from Bill Sutherland from The Benchmark Company. Please go ahead. Your line is now open.
Bill Sutherland: Thank you. Hello team. Great quarter. Branislav, I was curious on the intellectual property front. Are you anticipating any additional patents that you believe could be issued here in the roughly near future? And if so, would they â maybe the type of area that they would cover?
Branislav Vajdic: Yes. Apparently, intellectual property is sort of foundation of this company. Very rarely do you find in this device space, in this market cap if you want a range companies that have this strong of a IP portfolio and growing, right. So in general, I would say, this is â we are very proud of it. Itâs not very common at all. Secondly, we have a couple of significant patents that are being reviewed. Especially, one of them in my own mind is extremely meaningful in terms of its commercial impact, potential commercial impact. And theyâre under review and the FDA and the patent office are hard to predict in terms of exactly when they will act, but certainly a significant patent by the end of the year approval of a significant patent by the end of the year is very much possible. And secondly, we continue to generate new intellectual property filings, right. One is going out within a few days. And then we have two more in preparation as well. So the cadence of IP continues at a very rapid pace.
Bill Sutherland: Great. And the â as you look at the commercialization process next year, have you â as youâve expanded the two types of AIMIGos, in terms of the 12-lead. Do you expect to have that at all impact your â how you go-to-market? Or will it really be just two sets of solutions with the same real market focus?
Branislav Vajdic: Jon, please go ahead.
Jon Hunt: Yes. I think initially it will stick to our knitting as it were, and focus on the two products as we described them in this presentation HeartBeam AIMI and AIMIGo. I think one of the challenges always with commercial teams, especially sales people is keeping them focused. So I want to get the pilots established, get those running, see what the uptake is like the value we create for the clinicians, getting early feedback from those early adopters if you like making any tweaks if we see them getting input for the technical team, that sort of thing, or the user interface and all those things. And I think if we get too scattered, the message gets jumbled a little bit when you go-to-market if you have too many things in the hopper at once. So I want to get them established and I think then when we get them established also get some feedback from the market on what they think the key value points may be given, Iâve got an inventor whoâs my boss and CEO that keeps coming up with more and more ideas of how to leverage this platform. So and Iâm spoiled for choice, but I want to keep the commercial team focused out of the gate for sure.
Bill Sutherland: Got it. Well, look forward to see you all at our Discovery Conference, December 1 and great work. Thanks.
Branislav Vajdic: Thank you, Bill.
Operator: There are no further audio questions at this time. Weâll move over to the webcast.
Rick Brounstein: Our first webcast question asked, have you had discussions with insurance companies and can you comment on how easy or difficult it will be to get insurance companies to cover these devices?
Branislav Vajdic: Jon, please go ahead.
Jon Hunt: Yes. We havenât had specific discussions with insurance companies. We have had discussions with some people that are very well connected to the large payers and large payers that have lots of covered lives under their span of control, spend an awful lot of money on the care of cardiovascular patients. So I think once we get established in the market, having that discussion with large payers will be very attractive. I know of some technologies that also manage high risk patients like diabetic patients, for example, where the reimbursement for helping to manage those patients from payers is much higher than corresponding codes for managing those patients or reimbursement for those patients. So thatâs a discussion weâre certainly got on the books to have. And I think in order to make a dent with an insurance company, one of my commercial team actually has been on the payer side and in a previous life has run the sorts of studies that will need to do a study to demonstrate to a payer the value that we provide in managing those patients. So thatâs definitely on our books and something we plan on doing is, I think it actually from a revenue standpoint is a very attractive option for us. And it removes us from the standard CPT Code sort of reimbursement mill. But yes, itâs definitely our mind. So want to get the products approved and then have those discussions.
Rick Brounstein: The next question asks, how many questions has the FDA asked regarding the current 510(k) submission? And are there any questions yet to be answered?
Branislav Vajdic: Well, we are not going to go into detailâ¦
Jon Hunt: Yes, Iâll take that Branislav.
Branislav Vajdic: â¦how many questions. But letâs just say that going into details, how many questions were asked, Iâm not sure that we accurately remember the number of questions that they were all answered very thoroughly. And indeed at this point, we are not aware of any questions that are not answered us. So the answer is, we have answered all questions and we are expecting action by the FDA by the end of theâ¦
Rick Brounstein: The next question asks, will you allow pharmacists in retail settings to use this technology to provide a life saving diagnosis?
Branislav Vajdic: Jon, maybe you should answer this one.
Jon Hunt: Well, Iâm assuming retail setting, youâre thinking of CVS and Walgreens and others Walmart that have these minute clinics or minute clinic equivalents. And certainly in the Charlotte region, I know CVS is our staff by a lot of mid-levels as well as pharmacists in their clinics. So itâs potential to have that discussion. And I think cardiologists may push back on as pharmacists are making a diagnosis regarding a cardiac condition. Iâm not sure, Iâd have to investigate that further. But clearly, one of the potential markets for us is interacting with the CVSâ of the world because of a lot of people in the country are closer to a CVS in many instances they are â than they are to a hospital. So I could see that being something of tremendous value. Itâs a matter of how do we go about proving that thatâs providing value one to the patient and also to the clinical community at large. So â but itâs a very interesting question. Again, something I think a CVS or Walmart or Walgreens would want to conduct a study to show that value before that even got into the realm of being â allowing a pharmacist to make those diagnoses in the field, so.
Rick Brounstein: I think we have time for one more webcast question and that question is, the first release of AIMIGo version one next spring is a commercial release, and if not, why not?
Branislav Vajdic: Again, I think Jon is the best equipped to answer that one.
Jon Hunt: Yes. So if you remember, weâd indicated previously that, that the version one of AIMIGo is sort of the stripped down basic version of AIMIGoâs recording a 3D orthogonal, 3D vector ECG at the heart. So it provides the core information for us to create a synthesized 12-lead. But version one has a very high cost structure at the moment. And at the moment, weâre building a limited number and weâre planning on because the cost of goods for version one, itâs not a scalable commercial product from our perspective, given the current reimbursement landscape. And so because we have V2 coming close behind, which is scalable, where we made a dramatic drop in the cost of goods for the entire packaged product labeled and everything and weâve reduced it by some 80% from the version one. So weâre going to use V1 at these centers that weâve identified to integrate it into a clinical practice and gather valuable clinical information from patients. Look at workflow, UI/UX, put BAS in place with those healthcare systems to facilitate the V2 launch, which will be a scalable product that we can then go after in a much more aggressive fashion and version one out of the gate from our perspective at the moment is going to sort of fill that very valuable role for us as this regulatory clinical work horse to set the stage for a full scale launch of the V2 product.
Operator: I would now like to turn the conference over to â back over to Mr. Vajdic for his closing remarks.
Branislav Vajdic: Thank you, operator. I would like to thank each one of you who joined us today for our earnings conference call and look forward to continuing to update you on our ongoing progress and growth. If you were unable to answer any of your questions, please reach out to our IR firm, MZ Group, who will be more than happy to assist. Thank you, again and have a good day.
Operator: This concludes todayâs call. Thank you for your participation. You may now disconnect.
