Artrya Limited (AYA) Earnings Call Transcript & Summary

Good morning, ladies and gentlemen. [Audio Gap] from KPMG are here, so welcome John and Francis. Just going through the format of today's meeting. Firstly, I present my Chairman's address. This will be followed by a joint presentation and software demonstration by Mat and John, which would be pretty interesting. We'll then open the meeting and attend to the formal business of the meeting, including a poll of all resolutions. The meeting will be closed once the formal business is concluded. So there are a number of people attending virtually, and welcome. It has been another tough year for Artrya, but I can say in confidence that we have laid solid foundations for the growth ahead. Mat Regan, as the company's CEO, had much work to do when he joined in April last year. His main priorities were to get things back on track with the FDA, including employing U.S.-based competent and experienced experts with a proven track record tin dealing with the FDA; and increase the capability of the product development team and commercialize the software. In relation to the first priority, a Q-Sub meeting was held with the FDA in June 2023 where the roadmap of work to be undertaken by Artrya was agreed. The right people to undertake this work we employed, and changes were made at senior levels within the company as well as with the product development team. At last year's Annual General Meeting, Dr. Girish Dwivedi and Abdul Ihdayhid demonstrated a software, which is close to having a product for commercial use. I'm pleased to say that with further development, we have a commercial product that clinicians can use, subject to having the necessary regulatory approvals, and we intend to do a presentation shortly in the current version of the software as a clinician would use it. In parallel with further development of the product to FDA application status, Artrya has also concluded pre-FDA agreements with Northeast Georgia Health System, Tanner Health and Cone Health in the U.S. The purpose behind these agreements is to generate income for these health systems as soon as possible post FDA clearance. In total, these health systems conduct approximately 15,000 to 20,000 Coronary Computed Tomography Angiography or in other way CCTA scans per year. We are in advanced discussions with much larger U.S. healthcare systems, and we'll continue to work with them to execute contracts during the course of calendar '25. One of the key benefits of the Artrya software is the real-time point-of-care approach. Clinicians can treat the patient shortly after CCTA scan is taken, retaining control over the reporting and their patient. This is becoming important as U.S. hospital systems increasingly adopt a value-based care approach to patient care. Our competitors do not offer a cloud-based point of solution -- point-of-care solutions, sorry, which is a key differentiator for Artrya and a clear market advantage. John and Mat will cover this in more detail in the presentation and product demonstration shortly. Closer to home, we are generating small revenue from our first commercial client in Australia, the Cardiac Center of New South Wales based in Wollongong. We are dealing with much larger Australia-wide radiology groups and are confident of entering into commercial arrangements with them in the coming months. Having said that, I want to be clear that our primary focus is very much on the U.S. market where substantial reimbursement codes already exist for the use of AI-assisted CCTA scan interpretation for coronary artery disease detection. The U.S. is a large market where approximately 4.4 million CCTA scans are conducted every year and growing at over 6% per annum. This growth will be further fueled by a recent decision by the Centers for Medicare and Medicaid Services, CMS, to more than double the Medicare reimbursement rate for CCTA scans, raising payments from USD 175 to USD 357 per scan. Upon UFDA clearance of our current 510(k) application, Artrya will be well positioned to access this reimbursement. The payment rate for Automated Plaque Analysis remains at USD 950 per scan, while Fractional Flow Reserve reimbursement has increased from USD 997 to USD 1,017. So Artrya is targeting FDA approvals for Salix Coronary Plaque and Salix Coronary Flow by the end of calendar '25, giving us access to a combined reimbursement of approximately $2,000 for both procedures. The American College of Cardiology and the Society for Cardiovascular Computed Tomography are recommending CCTA as the first-line test for patients with chest pain rather than other traditional modalities. The tailwinds for Artrya are clear and favorable. The staff are all aligned and incentivized around achieving FDA approval for the SCA, SCP and SCF products during calendar '25. It goes without saying that a growth company such as Artrya cannot deliver on the opportunities available if the company isn't well funded. To that end, we completed a successful $5 million raise earlier this month. The Board decided that we needed to extend the runway before running cash too low and reduce the risks associated with the state of capital markets. Dilution was minimized, and we brought on a number of new institutional shareholders as well as Healthliant Ventures, the venture arm of U.S. hospital system, Tanner Health, enhancing and widening our investor base. In closing, I'd like to thank our long-standing shareholders for your patience and offer a big welcome to our new shareholders who have joined us for what we consider to be an exciting journey ahead. I'd also like to pay a big thank you to my fellow Board members in Kate and Jacque, to Mat and JK and the whole Artrya team who have worked tirelessly over the last 12 months to get us to this point and provide a great springboard for the year ahead. Thank you, and I'll now hand you over to Mat and John for their presentation.

Good morning, and thank you, Bernie. Thank you for that, and thank you all for joining us for the Annual General Meeting this year. For those who don't know, my name is Mat Regan, and I'm the CEO at Artrya. As Bernie mentioned, my primary focus over the past year has been to refine our Salix product to meet the high performance standards expected of the commercial product in this medical sector. If I start with the presentation on Slide 3, you'll see I've listed out some of the key achievements over the last 12 months. A key priority has been reengaging with the FDA to prepare for our entry to the U.S. market, all while carefully trying to manage our financial runway. Our goal is to secure an FDA clearance for our Salix Coronary Anatomy product, which we will anticipate to be cleared in the first quarter of calendar year '25. We took a cautious yet strategic approach by scheduling a second Q-Sub meeting with the FDA in August this year to ensure we were on track, and we submitted our 510(k) application at the end of September this year with a high level of confidence. On the commercial front, we secured strategic partnerships with 3 U.S. hospital groups. These partners serve 3 critical purposes: One, testing our software into hospital imaging workplace systems; further validating our software by clinicians; and streamlining the sales cycle to generate revenue as soon as possible once SCA has achieved FDA clearance. Closer to home, we successfully launched Salix in Australia and have begun generating revenue. The feedback from clinicians has been positive, particularly regarding the benefits plaque assessment and our unique point-of-care approach. Our collaboration with The Cardiac Center in New South Wales has been -- has increased awareness and interest, and we are in active discussions with top-tier imaging groups across Australia. The rigorous process of preparing our 510(k) submission has also strengthened our ability to navigate further applications with greater assurance. Looking at our product road map on Slide 4, just wait for that to come through. On Slide 4, across the bottom of the slide, you'll see our SCA product, which is the subject of our current 510(k) application with the FDA. Our intention is to file this 510(k) application for Salix Coronary Plaque, SCP, which is on the left-hand side there, in the first half of calendar year '25, building on top of the other one. And then that will be followed by our Salix Primary Flow, our SCF product, that's our blood flow product, mid-next year. The goal is to have both SCP and SCF approved by the end of calendar '25. Slide 5, please. This sets out our current -- the current approach to CCTA reporting and the approach that our main U.S. competitors take. The current system, which is the top line, is very manual, time consuming and generally does not report the high-risk plaque because it's very time consuming and difficult to see -- difficult to see with the human eye. The middle line depicts our main competitors being HeartFlow, Cleerly and Elucid. The CCTA scans get sent off-site to their premises where a manual work up with the images, a fixed report is generated and sent back to the clinician. This process is time-consuming, expensive, and the clinician cannot amend the report if they disagree with the findings and has to request a subsequent additional report at extra cost. The bottom line shows the Salix process, which is fully cloud-based with no human in the loop, and it is currently only point-of-care approach, which takes approximately 10 minutes to generate the report for the clinician. The clinician can review, amend where necessary and approve the report and provide a treatment regime for the patient in the same visit. Slide 6 sets out why we have focused on the U.S. market. There are 4.4 million scans per annum and growing at a rate of better than 6% per year. The Centers for Medicare and Medicaid, CMS, has recently increased the reimbursement for CCTA to encourage clinicians to use this pathway, and we expect further CCTA growth because of this. Slide 7. This drills down into how Artrya fits into the reimbursement regime. Post our FDA clearances, Artrya will charge a monthly subscription for the use of our SCA product. When SCP is approved, we can charge a fee per scan where the reimbursement is established currently at USD 950 per scan. Approximately 70% of patients who have had a scan will require plaque analysis. About 50% of those patients who have had a plaque assessment will have potentially obstructive lesions and will be sent for noninvasive blood flow assessment. That's our SCF product. Once SCF is cleared by Artrya, while the FDA and Artrya can access the reimbursement of $1,017 per scan. On Slide 8. There are significant tailwinds and drivers of growth in the U.S. market. The American College of Cardiology and the American Heart Association are recommending CCTA as the first-line evaluation for patients with chest pain. And as mentioned earlier, attractive reimbursement exists for AI-enabled CCTA. This is a tremendous advantage as many health care businesses trying to penetrate the U.S. market spend years but gaining access to reimbursement codes. Additionally, there are newly published studies and pathways for the treatment of patients that have non-calcified and high-risk plaques. JK, if you don't mind, we might pass to JK and we'll get the demo of the current software up for us all to have a bit of a look in that. Thank you, shareholders, for joining this.

So when John is demonstrating the software, this is the software that a clinician would use in their practice. So if there are any questions during the course of this demo, then let's have a chat about it.

Yes. Please ask if any....

And make it interactive and so on so that we can get the most out of it. But it's pretty impressive stuff. Now the issue won't be the software, the issue will be John because he only just got in the U.S. yesterday.

[indiscernible] clinical way. But I appreciate the time, and I think if you look -- if you remember the -- one of the slides that Mat mentioned that show the green line with the scanner in the front and the green line across, effectively, that is the standard procedure, which clinicians use to access -- access the CCTA scan. The scan is taken. And once the scan is taken, it takes about a 10-minute period from our perspective to process the results, which you see on the screen over here. And in a normal reporting instance from the center of the screen left is effectively what the clinician is seeing. So it's very hard for them to assess the severity of the patient and where to actually focus whether the patient is healthy or requires further treatment. What we really provide is a full assessment on a quick dashboard so that they can triage a patient pretty quickly. And that's important not only in standard imaging centers, but in the emergency room and in emergency settings where patients are going with chest pain and need to either moved into the system pretty quickly or moved out of the system because that's something else. So what you see here is within that same 10-minute period, we process the calcium score. We look at the severity of narrowing that the AI finds, and we categorize that into different categories based on how severe that is. There's a risk score that's associated to that, 1 being very low risk and 5 being very high risk. And then there's all the high-risk plaque features that the AI is able to find within a specific patient. So you can quickly see that it's an easy way for clinician to test. And I'd like to show this scan here because I think it's quite an easy one. If you all remember in the Boxing Day test last year when the Shane Warne Foundation said everybody go for calcium score, that was great. But if you look at this patient had a zero calcium score, if that patient only went for calcium score, they would have missed severe narrowing high-risk and high-risk plaque features of the patient. So it's -- the calcium score, while it's good, is not a full -- it doesn't give the patient or the clinician full story. So clicking on to this patient, and this is what the doctors normally have access to. You quickly see a few things. And the first thing is a 3D model, which is a true representation of your coronary arteries. So it's effectively removing the heart from the arteries and showing those arteries on their own. And then what happens is we overlay the coronary -- the findings of the AI on this coronary artery so that the clinician can actually see and use this as a road map to treat the patient. And where it's important, this coronary artery tree over here, they call this the widowmaker. It delivers more than 50% of your blood to your heart. If there's a blockage or severe disease there, that's usually very crucial and critical. The doctor wants to treat that pretty quickly. The second thing is for clinicians, they're able to use this as a mechanism and how they treat the patient more effectively as well by the patient knowing where the disease is, they're able to follow treatment plan a lot more precisely as well. So that's the first part. The second part is similar to what you saw in the dashboard, but then also additional risk scores. The diagnostic side, and this is where a lot of the AI plays a real value add is I'll shift this marker down to this lesion over here, and I'll remove the annotations. This is what a clinician would normally see within that part of the coronary artery. So this white piece here is a cross-section through this coronary artery. And it's really hard to justify or assess whether there's high-risk plaque, there's non-calcified plaque and what component and what burden of that is. So they make an assessment quickly and they move on. But if I turn this on here and I turn the plaque mask on, you can quickly see that there is a lot of high-risk plaque within this primary feature here, cross-section here, which means that just knowing that the doctor can give them a specific type of medication to try to address that or try and transform that plaque into something different. So just knowing the type of plaque it is, they've got a clear view on how to treat the patient. And that, as Mat mentioned some of the tailwinds, there's new studies now that show with these type of plaques, these are the type of medications you should be taking. The second part is what we provide is not only the composition of plaque, but the clinician can now use how much of that plaque is there to track the treatment plan over time for that patient. So you can see the volumes and burdens on the screen that effectively tells the clinician that we need to see less of this as we treat this patient. So it gives them a true view on the treatment process for that specific patient. Again, on the working and the workflow side of things, we really try to make it easy for the clinician. If they disagree with findings, they've got the ability to change at any one point. So you can see that makes changes to the coronary arteries and then propagates to the report, which improves workflow and makes a lot of efficient in our workflow. There's key features which supports the product road map. They can now add stents to the product. So you can see it's added stents to the specific lesion and that improves the reporting. They can add bypass grafts. And that all sets the foundation for future products that Mat mentioned. And that also then finally moves to the raw scans, which they can assess, but ultimately, the digital report, which is automatically written within that same 10-minute period, and they can make changes accordingly. But what they don't get currently is a full view of plaque and the type of plaque and how much of it is. And just having the composition and the volumes gives us access to the USD 950 that Mat mentioned earlier within the U.S. So I'll stop there. It's quite a lot. But then this is the software is used currently in practice here in Australia. It's getting a lot of interest in the U.S. because not only the ability to assess plaque at the point of care, but to optimize workflow. As Bernie mentioned, I got back from U.S. yesterday, some of the key health systems that I've been speaking to have waitlist of up to about 6 weeks before clinicians -- before patients can get a scan. Having a system like this allows them to expedite that as well. So you get the diagnostics side, but then you get the productivity side as well.

So you see here that the SAP or the product, a lot of the development work is already done for that. So that's the next 510(k) application that will happen in the first half of next year. Yes. Questions? Yes, Chris?

Other than the [indiscernible] two, three opportunities till the end of the [indiscernible]

It's a good question. I mean the speed of delivery is a big one because of the timeliness of care. We've also worked heavily around our plaque assessment, being able to show that in the same delivery period. There's a piece of work that's been worked heavily together with Dr. Girish Dwivedi out of Harry Perkins Institute, which is for plaque dispersion, which means it's not only looking at whether plaque is localized or spread across the vessel, it then basically looks at how much of that spread influences treatment regimes. And that's very, very novel to anybody else in the world. There's nobody else doing that. So that allows us to not only give the patient ability to -- the clinician ability to treat the patient, but then scale up treatment or dial down treatment based on that. I do want to maybe not underpin how important the speed of this is because it underpins the whole product road map. If you look at some of our competitors that do a plaque assessment in, let's say, 2 to 24 hours, we run everything in parallel and which means that once our blood flow assessment comes on, we get the same result in the same time of period. So it's not waiting 24 hours for plaque and then another 24 hours for FFR, you get everything.

I'd just also add the feedback we're getting from clinicians is it's the control they like. They can change things. It's their report. It's not somebody else's report that we tend to often receive that. They have that control after that 10 minutes and they can modify it and change it wherever they like.

[indiscernible] Will the clinician get a similar report back just in 24, 48 hours. Is that your report is actually...

Yes. So that -- correct me if I'm wrong JK. But they will get essentially this report, but it's something that they can't question or query or analyze themselves. So they would get something similar to our report, but if somebody else has done it for them. And if they disagree with that, they have to go back and ask for another report.

[indiscernible]

Yes, so they can generate multiple reports from here. They could change it and do another report.

[indiscernible]

Yes, it is yes. [indiscernible]

I mean that's one of the big negatives of the competition. The feedback we're getting from clinicians in the states is that they don't have control over the reporting. So they've got to accept the report as it's delivered to them by our competition. And the other issue is the cost of delivery because they have a human in loop because the scan is sent off to their premises and it's worked up, AI apply into it, sent back to the clinician. There's a cost associated with that. So one of our competitors is actually charging more than the reimbursement. So it's actually costing the hospital system or the health care system to use it, whereas we're fully cloud-based, and we can share in that reimbursement with the health system.

Yes. I mean I'll just add maybe to answer some of Chris' questions as well. The top gray line that was on the Mat's chart, that line has to be done independently of a plaque assessment. They still have to do a CCTA report because it looks at everything in the coronary arteries. The second line, which is where the competitors play, that does only give a plaque report; that doesn't give a CCTA report. So effectively, the doctor has 2 systems right now, one to do a CCTA report and one to do a plaque report, one to do FFR report. We have combined everything into a single platform. So effectively it combines the 2 lines into one. So it's a major differentiator for clinician that they don't have to have multiple screens open and there's obviously extra costs associated to having multiple systems open as well. So to answer the question, Kim, this report here is not only the plaque report, it's also the CCTA report in one. And all these changes coming the change here, as an example, I want to add a bypass graft. I can add a graft to that or just say whatever. This isn't available in -- you can see it's added to bypass graft now. This isn't available in our competing solutions because we're trying to make sure that we're keeping the clinician reporting for a single platform throughout the entire process instead of having multiple systems.

And we will just add more modules into that platform as we go. I think just for everybody and also online, just to fully understand, I mean, so JK is running this through the WiFi, through a Zoom call, through a Teams call, and it's performing the way it is. So that's what we talk about. We've spent a fair bit of energy and effort getting a commercial ready product for the medical industry, and that's where we're up to.

So John, are you able to pull up the final slide just to give people a bit more into that.

And while we're doing that, we have a couple of questions, I think, Danny. But we don't -- we might have to try and get some volume on here to get those questions. That could create a [indiscernible] unless you want to type them on the chat, Danny.

I'm happy to ask them, if you like so.

We can't hear, Danny.

You can try to unmute.

Can you hear me now?

One second, Danny.

Can you hear me?

Danny, can you hear me?

I can hear you, JK. Can you hear me?

Yes.

Okay. I'm getting some echo. So Mr. Chairperson, we do have some questions. The first one is from shareholder, Nick Huntley. Based on the new slide deck uploaded today, forecast first revenues calendar year '25, do you need to raise capital again to get you there?

[indiscernible]

Sorry, Mr. Chairperson, I'm getting some echo.

Go ahead, Danny.

Okay. Do you want me to repeat the first question?

No, no, we got that.

Second question.

And the second question is also from shareholder, Nick Huntley. How many scans have been completed at the cardiac center over a quarter and the revenue. What is the scan mix currently SCP, SCF, SSA and SPP?

So I can answer part of that. As of the end of the last quarter, we'd -- correct me if I'm wrong, Mark, around about 547 scans. We can't give the revenue on that openly, but it's -- because they were start, they were the first customer we had, we discounted that heavily to work closely with them. The scan mix has predominantly been through one single scanner, and we've been processing those on an ongoing basis. We've also only used SCA effectively with the cardiac center because in Australia, the understanding of plaque volumes isn't as well -- is not as mature as it is in the U.S. So clinicians report very much on plaque composition and less on the burdens and volumes.

I think I can add to that by saying that -- and we've always maintained this position [Audio Gap] situation for the industry here. And we'll never make any money out of doing deals here in Australia. That's why we're fairly focused on the U.S. where there are -- where there is an attractive reimbursement regime.

Thank you. The next question is also from shareholder, Nick Huntley. The question is, are the reimbursement payments one-off for patients? Or every scan, including follow-up scans as part of management treatment?

Yes. It's a good question. And Jacque -- Dr. Sokolov can also jump in. If there's a CCTA scan that's done, we will charge for every patient that goes for CCTA scan for the Salix Coronary Anatomy product. For the Salix Coronary Plaque, ideally, in an ideal scenario, every patient should be getting that because it also forms a better assessment on what the disease profile is for that patient is going forward. But we've been conservative in making the assumption that 70% of patients that go for a scan will have the Salix Coronary Plaque assessment and get that reimbursement for Salix Coronary Plaque. If the clinician wants to assess the patient further, let's say, in 2 or 3 months, and they do another plaque assessment, they will be charged for that same patient and another reimbursement for that specific patient.

This is Jacque Sokolov. So what JK has mentioned is absolutely correct. And what is, I think, going to become more common is you're going to see serial scans for progressive reasons. So the patient population gets sub segmented into a lesion that is significant enough to then get a flow analysis after a characterization of the lesion that lesion may even be -- you may even see an intervention, such as a stent for instance. You'll see a pre and post-procedure scan over some period of time. So it is very much related to the number of scans, and that patient may have numerous scans over a 3-month period of time.

Thank you. The next question is also from Andrew Wilkinson. And the question is, can clinicians overlay earlier scans to easily compare scans taken over time so to see how a condition is progressing or improving due to treatment.

Yes, it's a good question. And that sort of follows on from, I think, the question Nick Huntley asked. As part of our road map, we do have what we call delta assessment, which means a patient will go for scan on day zero. And 3 months or 6 months later, if they come for a second scan, we'll be able to show whether disease has progressed or regressed. And that's important from a monitoring and a treatment pathway. So currently, we don't have that, but it is definitely part of our road map for something that we need to bring in.

Okay. And the final question is also from Andrew Wilkinson. Are the competitors you mentioned working on upgrading their platforms to remove humans from the loop and allow clinicians to edit their report?

Why don't you let me answer that one because at least in the United States, the FDA has to certify what's called the Class III certification for automatic reading, and the FDA has been absolutely reluctant to remove the clinician, whether it's a radiologist or cardiologist from an automatic read. There are a whole variety of reasons for that. But at the end of the day, there's no question that the AI technology can read the scan most likely, in many instances, better than the human, but the human has got the judgment. And we glossed over one thing a little more quickly than maybe we should have, and that's the inflammation piece. That hot and cold plaque that JK went over, that's transformational. This is the only technology of all the different -- of all the different companies that are out there that can look at what's [Audio Gap] an inflammatory plaque is at the heart of what causes strokes and heart attacks, and that's not going to be determined by an AI judgment at this point. And really what we're doing is we're really giving the clinician, cardiologist or radiologist and eventually the patient, the ability to really look at the disease process much more effectively than they can without the technology. So no, you're not replacing the doctor.

Thank you very much. That completes the questions.

Thanks, Daniel. I'll just quickly show one slide just so that our shareholders have a clear view on what Salix Coronary Flow looks like. I'm going to find my reader here now. There we go. So the second product -- the third product, which we're working on is Salix Coronary Flow, which is a noninvasive assessment of looking at the blood flow through a specific lesion. And there's only a real -- there's only a certain band where patients will go for this test, and it's usually when there's -- the doctor is uncertain on whether the lesion is obstructive or not. And what the current process is that if the clinician is uncertain, they'll send that patient on for an invasive procedure where you put a catheter in the patient's leg or arm and that they use a wire to go assess that severity of that lesion. As part of what we've built is of the same CCTA scan, we're able to do that same blood flow assessment in a 10-minute period. And what you can see here is a mockup of the screen I showed a demo live. But this now overlays the blood flow on the coronary artery and it really gives the clinician a quick view at any one point at any lesion what the blood flow drop, the pressure drop is across the lesion, so they can make a better informed decision on whether that patient should go for a further invasive procedure, whether it's a coronary angiogram or a stent or anything else. So we've said it so many times that over 40% of patients that go for an invasive coronary angiogram have never needed it. And this is now that effectively that gatekeeper to make sure that if they are going for it, they really need it.

The other important thing here is that once we fully develop the part and the FFO -- FFR for the blood flow assessment, all that work is done upfront in the same 10 minutes of the same CT scan. So when a clinician wants to access that have got the patient and they've done the scan, they click on the plaque assessment, get there, that initiates a reimbursement of USD 950. And then they'll click on the FFR assessment and want that, and that's another $1,017 reimbursement. So there's no extra work for Artrya in that. It's all done upfront in the same 10 minutes. So the cost of actually generating a further reimbursement is very, very small. [Audio Gap]

Basically satisfied by the time we get approvals, so that when we do get the necessary approvals, then we can generate revenue fairly quickly post that. So we're trying to get in front of that, Chris. And that reimbursement person is highly experienced in this exact area. Yes.

Thanks, JK. And clearly, for those that are in the room, after which we can show you a bit more on the mix in the boardroom. But here on Slide 10, just for me to sort of round out, it's pretty clear what our priorities are for calendar year '25. So we're very clearly focused on the U.S. market, obviously, an attractive reimbursement landscape. access that market, we'll continue to engage with the FDA to approve our current application, which is SCA, followed on by our SCP, which you've seen a lot of the development is done. It's now really around clinical trials and building on the FDA and that sort of thing. So -- and then, of course, we'll follow up on with the SCF. That's quite a tight time frame, but we're working hard to get that done. We'll also look to secure our U.S. revenues as soon as we can post the FDA clearance of our SCA product. And we'll continue to expand our client base in Australia as a good corporate citizen in Australia and to validate Salix that helps us as well with the U.S. as we validate our group and use our U.S. pipeline with our strategic hospital groups. In closing, I'd just like to say -- extend my thanks to our team for their dedication and hard work and also to our partners for their invaluable support. And finally, to you, the shareholders, I'd like to thank you for your support over my first 15 months to get us to where we are today, and we really are standing on the precipice here, I think. So we look to the forward energized as ever and ready to drive our progress forward.

Thanks, Matt. So that concludes the informal part of the meeting. So we'll now get on to the more formal part. But -- and we'll open the meeting. I've been advised that we have a quorum present, and I declare the meeting open. So schedule of proxies eligible to vote at this meeting is now tabled, and I draw your attention to the screen showing a summary of proxies. The company has received valid proxies from 75-odd shareholders holding a total of approximately 36 million shares, representing 40% of the issued capital of the company. The specific voting preferences indicated by proxies who have either directed their voting preferences or have left their voting preferences open to be cast by the nominated representative or the Chairman are available for inspection. Where a proxy vote has been given to the Chairman with the instructions to vote in favor of the resolution in accordance with the directions on the proxy form, I intend to vote in favor of the resolution. Any undirected proxies will be voted in favor of the resolution. So a copy of the notice of meeting convening this meeting has previously been made available to all shareholders and sets out in detail the nature and purpose of the resolutions to be considered at today's meeting. I propose to take the notice as read. I do not propose reading every resolution for or refer to the resolution as set out in the Notice of Meeting. After each resolution is displayed on the screen, I will invite questions from the floor, and I will be limiting questions to the motion being considered. I would ask that you state your name for the record when you address the meeting. If a question is asked, which, in my opinion, does not relate to the motion which is before the meeting, I will rule that question as in this. In my capacity as Chair and in accordance with ASX governance guidelines, I will today request that a poll is taken on each of the resolutions being considered. We will conduct the poll at the end of the meeting and after we have put each of the resolutions to shareholders. So agenda item #1 is receiving the financial statements. The first item on the agenda is to receive and consider the financial statements for the year ended 30th of June 2024, consisting of the directors' report, the financial report, the directors' declaration and the auditor's report. We have both John Ward and [ Frank ] from the company's auditors, as I mentioned earlier, and John and Frank are available to answer any questions specific to the conduct of the audit. Are there any questions or comments in relation to the reports under consideration? There's no requirement for a vote on this item, so we shall proceed to the second item of business, which is Resolution 1, the adoption of the remuneration report. The Corporations Act requires that a resolution be put to members to adopt the remuneration report as disclosed in the directors' report section of the 2024 annual financial report. In accordance with the legislation, the vote on the resolution is advisory only and does not bind the directors of the company. However, the Board will take the outcome of the vote into consideration when reviewing the remuneration practices and policies of the company. I now refer shareholders to the screen displaying the resolution in full and the valid proxy results. So I now formally move the motion that Resolution 1 be put to the meeting in the form set out in the notice of meeting. Is there any discussion on this resolution? In my capacity as Chairman, I call for a poll on this resolution to be held at the end of the meeting. Moving on to Resolution 2, the reelection of Dr. Jacque Sokolov as a director. The second resolution seeks the approval of shareholders for the reelection of Dr. Jacque Sokolov as a Director of the company. I now refer shareholders to the screen displaying the resolution in full and the valid proxy results. I now formally move the motion that resolution 2 be put to the meeting in the form set out in the notice of meeting. Is there any discussion on this resolution? Well, welcome back, Jacque. But I'll call for a poll anyway on the resolution to be held at the end of the meeting. The next 2 resolutions deal with the ratification of prior issues of performance options to strategic partners. So Resolution 3 is actually the ratification of prior issue of performance rights -- performance options, I should say, to Cone Health. This seeks shareholder approval ratification for the issue of 1.18 million performance options to Cone Health Ventures. I now refer shareholders to the screen displaying the resolution report and valid proxy results. I now formally move the motion of resolution 3 to be put to the meeting in the form set out in the Notice of Meeting. Is there any discussion on this resolution? I'll call for a poll on this resolution to be held at the end of the meeting. So Resolution 4 is concerned with the ratification of prior issue of performance options to Tanner Health and seek ratification from shareholders for the issue of 1.18 million performance options to Healthliant Ventures, an affiliate of the Tanner Health System. And people might recall that Tanner Health have actually invested in the recent placement. So that's good validation that they're using our -- well integrated the software into their system and they're prepared to back the company as well. So that's a great confidence in what we're doing. I now refer shareholders to the screen displaying the resolution in full and the valid proxy results. I now formally move the motion that resolution 4 be put to the meeting in the form set out in the notice of meeting. Is there any discussion on this resolution? I call for a poll on this resolution to be held at the end of the meeting. Resolution 5, approval of 7.1A mandate. The fifth resolution is a special resolution and seeks the approval of shareholders for additional capacity of up to 10% of the issued capital. I now refer shareholders to the screen displaying the resolution in full and the valid proxy results. I now formally move the motion that Resolution 5 be put to the meeting in the form set out in the notice of meeting. Is there any discussion on this resolution? I call for a poll on this resolution to be held at the end of the meeting. The sixth and seventh resolution seeks shareholder approval for the issue of options in lieu of cash consideration for services rendered. And Resolution 6 is for issue of options to services rendered by Beith Capital Advisory. This resolution seeks shareholder approval for the issue of 231,000 options to Beith Capital Advisory as consideration for services rendered. I now refer shareholders to the screen displaying the resolution in full and the proxy results. I now formally move the motion that Resolution 6 be put to the meeting in the form set out in the notice of meeting. Is there any discussion on this resolution? I call for a poll on this resolution to be held at the end of the meeting. And the other person we're working with is [indiscernible], which is known here is L Davinci. And the resolution seeks shareholder approval for the issue of 231,000 options to L Davinci LLC as consideration for services rendered. I now refer shareholders to the screen displaying the resolution in full and the valid proxy results. I now formally move the motion that Resolution 7 be put to the meeting in the form set out in the notice of meeting. Is there any discussion on this resolution? Just for the benefit of shareholders, [indiscernible] and Carsten, Carsten Beith, Beith Capital and [indiscernible], they have been really critical in us. You might remember that during the course of my address, I mentioned that we're dealing with a number of large -- much larger health systems in the U.S. They've introduced those health systems to us. And John's visit to the U.S. just this last week or so, he met with all of those different health systems. And in some cases, it's the second and third meeting we've had with them. And if we just focused on those alone, then we don't have to have a major sales force in the U.S. going forward because they've introduced us to health systems that will keep us busy for the next few years. So it's a good investment that we've got these guys working with us. So I'll call for a poll on this resolution to be held at the end of the meeting. The final resolution seeks shareholder approval to increase the maximum number of securities that may be issued under the company's performance rights and option plan to a maximum of 7,875,000 securities. I now refer shareholders to the screen displaying the resolution in full and the valid proxy results. I now formally move the motion that Resolution 8 be put to the meeting in the form set out in the notice of meeting. Is there any discussion on this resolution? I will say as Chair that it is very important that we have the ability to incentivize staff and particularly with the top talent that we have in this company, both in the U.S. and here. And everyone in the company from Mat down now is incentivized around delivering those outcomes for calendar '25, which Mat outlined in his address. So we're all aligned from the Board down. So I call for a poll on this resolution to be held at the end of the meeting. So a little bit info. I've got to run through this as a formality, the poll on the resolutions. As advised, all resolutions for consideration at today's meeting will now be decided by a poll of shareholder votes. I will ask Jonathan Lamb from our Share Registry or Automic to act as returning officer. Recent changes to the Corporations Act have changed the law in relation to the obligations of proxies to vote where a poll is called on any resolution. If the proxy is the Chair of the meeting at which the resolution is voted on, the proxy must vote on a poll and the vote must be as directed. If the proxy is not the Chair of the meeting, the proxy need not vote on the poll. But if the proxy does so, the proxy must be voted as directed, if you can follow that. If you are a proxy holder with open votes, you may vote as you wish. You've been handed a ballot paper for the poll on registration this morning, and the resolution upon which the poll has been taken is to be set out on the ballot paper by you. That is resolutions 1 to 8. You should record your vote now by placing cross in either the for or against square on the paper. You should also print on the ballot paper your name. If you are a shareholder or the name of the shareholder is proxy representative or attorney you are. If you hold multiple proxies, please state this, and we will complete the information from the proxies. So we'll just take a little while people cast their votes. [Voting]

Yes, has everyone cast their votes? Very good. I therefore declare the poll closed, and the results of the poll will be announced to the ASX later today. Shareholders are entitled to ask questions or make comments on the management of the company. Do any shareholders wish to avail themselves of this opportunity, we're more than happy to take questions. Yes?

And obviously, we all want the approval in the U.S. If things don't work out, is there a plan B?

There's always plans B, C and D. But I think on this particular occurrence, it's more a matter of time rather than if we will get this approval. We have plenty of opportunity elsewhere in the world, but nothing is as lucrative as the U.S. market. So that is our primary focus. We put in so much rigor and effort into this current FDA application there. If we were to be rejected, we would have already heard that news, I think. We haven't heard from the FDA yet, but we're expecting to work through the process with them, and it's really just a matter of time, I think. But there is always a plan B, C and D and other markets in the world we would approach and that sort of thing, but that isn't in our current workflow consideration.

I think to add to that, and Jacque, you might say a few words on this as well. But the FDA want to approve things, but they want to approve things that are safe. So they've got to work through a process with companies like us, but they're not the big go. I mean that's why we've had the Q-Sub meetings is to agree the road map that needed to be satisfied to get approval. So it's really engagement with the FDA, working through the process, which is what we're doing. And we expect to -- on the latest application, we expect to hear back within the next couple of days just what the next step is. But it won't be a no. So as Mat said, we would have already heard that.

So just...

Jacque, any thoughts on your side?

Sure. Thank you, Bernie. Having gone through multiple, multiple FDA processes and sitting on several boards that are going through FDA processes, Bernie's comments and Mat's comments could not be more accurate. The FDA has gone from several years ago approving multiple indications with one application to really approving very singular -- with very singular focus, certain aspects of a software as medicine, et cetera. So when you look at Artrya and the AI-enabled CCTA capabilities that we talked about and the 3 or 4 different products that we are moving forward, you just have to take them in a sequential way so that you don't bite off more than you can chew and the FDA feels comfortable that you basically train these large language models effectively and that ultimately, you're not going to harm the patient. The AI piece of this as it relates to the FDA is very scary to them because as someone who asked very appropriately, could this replace doctors? Could this replace humans? Could this actually do things that could harm people? And the answer is unchecked, you can do anything. So there's a lot of checks and balances here. Our technology involves hundreds and hundreds and hundreds, sometimes thousands of scans in training these models so that what we conclude is absolutely accurate. What we conclude is very much focused and not over-expansive. And when we look at 2 or 3 or 4 applications, we have the data to support those 2 or 3 or 4 applications, and we'll do it sequentially, not all at one time. So to make a long story short, I think Artrya and all of us have learned the FDA has a very deliberate way of doing things. I think Mat's totally in touch with all this. Our team is very good. The Board is absolutely preoccupied with providing as much guidance as we can. And I agree with Mat. It's only a matter of when, not if. But that when could be a little more protracted given the complexity of AI, especially in the cardiac area. So make a long, long story short, we will get there. I think we'll have a superior product, and we have to basically support our clinical studies long enough so that we basically can generate the revenue that we know we can achieve.

This FDA application is the first in a series of FDA applications. So it's very important to us. And Mat and the team have been rebuilding credibility with the FDA after the first go around didn't work, and there are obvious reasons for that. But in this case here, we're establishing a very good relationship with the FDA where we've had very professional people involved on our side and so on. But this is only the first application. So as we pointed out, with that product road map, we've got to get plaque approved, we're going to get the flow product approved and so on. So this is -- it's a pretty intense process, and we've set some pretty tight guidelines in terms of -- or milestones in terms of getting approvals through the FDA during calendar '25. And the reason we've done that is because -- and I think Andrew Wilkinson asked the question around the competition and so on. We've got to assume that the competition is working hard and so on to do things in a point-of-care type approach, but they're going to have to go through the similar approvals that we're going through. But to be first to market and largely the U.S. is -- it is a greenfield market because HeartFlow clearly have very little market penetration in that country. So it's an amazing opportunity. I've never seen anything like it, but it's an amazing opportunity, and that's why we're going hard during the course of calendar '25 and why we've set those really tight deadlines. Mat, the team are going to be working their backsides off to achieve those milestones, but it really is important that if we slow down our cash burn and take longer to get there, then we might not be first to market with that point-of-care product. So really important that we have that strategy and so on. So long-winded answer to your question, Jerry, but does that help -- any other questions? Yes.

Chair, I am investor. I've got a couple of questions here. First one is, has the company made any inquiries or any steps to do some environmental scanning given the political change in America and how those changes in nominations of various random may affect how the FDA works after January 6. And as a subset of that question, I know American is my last job. I know the American economy hates our sites. and wants to put as much [indiscernible] that is possible. And is the company -- has the company made any [indiscernible] U.S.-based entity to represent investment?

Yes. So Jacque...

I'll be very happy to answer that question, Bernie. First of all, that's an excellent question. I was going to actually pose that question because I'm sure every investor is thinking about the same thing. And at the end of the day, there are several macro trends and then a couple of micro trends, and we pretty much addressed the micro trends, but I'll talk about the macro trends for a quick second. With President Trump being elected, he's very much a transactional President, always has been, whether that's good, bad or indifferent depends upon where you sit on the side of the transaction. But the bottom line is after he was elected, the capital markets substantially opened up, the ability to basically raise money became apparently much more likely. And the financial constipation that we've been experiencing largely since the pandemic, I think, will ease in the next 12, 24, even 36-month period of time for the capital markets in general. We've seen a significant bull market in the equities and in the bond market in the last -- even in the last 3 weeks. But having said all that, the things that are most important to us are really regulatory in environments, and that includes the HHS Secretary, which may be Robert F. Kennedy, which is an interesting choice on a number of levels. The Dr. Oz, who's Head of CMMS, which is the Centers for Medicare and Medicaid and then the head of the FDA, who is critical, and that's a fellow by name of Michael McCahey. I actually know the proposed individual for the FDA personally. So I can -- I basically think that's positive for us if actually just knowing him is actually a positive, and I think that is. As far as RFK and Dr. Oz, I can't make a comment that I don't think they're going to have an impact on what we're doing at the level that really is going to be material. I may live to eat those words later, but I'm much more focused on the financial markets, and I'm much more focused on the regulatory FDA piece. And I'm also more focused on the transactional nature of what we're dealing with in terms of the capital markets. So in general, a long-winded way of saying, I think the election of President Trump actually serves us better than the election of the Democrats. And I think that's largely because we will see if we are successful doing what we want to do, a more receptive market for our company in general. So I hope that answers your question. And if you want anything more detailed, I certainly can respond. But thank you.

In relation to doing business in the U.S. we have a subsidiary that's already established in the U.S. called Artrya USA Inc. John is moving to the U.S. next year as well. But the response that we've been getting out of demonstrating the software to the actual market in the U.S. has been outstanding. So we don't see any trouble in terms of people taking on the software because they're very excited by particularly the road map, which includes FFR. So to have a point-of-care market FFR analysis is what -- to use their words, that's a game changer and so on. So there's a lot of excitement. I mean, John, you can add to that because it's just been there. And we really haven't had a negative in terms of displaying the software to potential end users.

Yes, Andy, it's a good question. And the one thing I will say is the nervousness isn't around foreigners in the U.S. That's more about them thinking that we think we know what to do in the U.S. going from here to the U.S. So it's -- and that's partly how we're moving there. But the major thing is that starting to bring the right people in the US to actually help do work a lot effectively as well. And that's part of the 2 Dr. [indiscernible] from Harvard, who is one of the guys we've spoken about [indiscernible] this group domain that Bernie mentioned that's going to help with regards to reimbursement. So it's bringing the right people in the U.S. to help structure the business over there. As Bernie mentioned, the feedback we've gotten thus far is when is FDA clearance coming as opposed to why the software. It's more when as opposed to software is not going to work because they do see a massive benefit of point of care as opposed to point-of-care solutions.

If I can comment, I think 2 answers you've given are really from a clinician perspective, not from a big strategic perspective.

Not from what? Sorry.

Great strategic where from my experience in my last job, new American companies [indiscernible] American companies decision makers to actually hold back external competition. And so there is the possibility that may hold back this external market leader while the other ones catch up.

Well, that's not -- I understand your question. And I've run businesses in the U.S. previously as well. And we by having [ Enrico ] and Carsten on board, we're going at the CEO level and signing the organization, which I haven't named them, but they are large health systems there. And the door is wide open. Now I'm not going to sit here and say that there's not going to be any negativity or old boy network that gets in the way sometimes. I'm not going to say that. But the response has been overwhelmingly positive because we've got Jacque there, we've got Carsten and [ Enrico ] and John will be moving there. And we -- as we go forward, we'll beef up Artrya USA Inc. with U.S.-based people and so on. So we're not just this little company from West Perth that's going to try and take over the U.S. by fly-in, fly-out type approach. So the people on the ground, working with the customers and the clients there and so on. As I said, not to say we're not going to run into some negativity because of the ongoing growth and someone that does exist, which is very real.

Yes. Bernie, just add -- the one thing which is always ends up cleaning up. I think you mentioned again, those valid points is dollars. Dollars -- it's revenue and dollars of profit in the U.S. It's very much a payer-driven system, as you know. And when our competing solutions are cost centers to a lot of these systems as they're losing money and we're able to make them profit centers, that old voice club, as Bernie mentioned, tends to disappear because whilst they're trying to keep -- they may be trying to keep their friends in if it's at the risk of that modality being a cost center, but they're going to quickly run into an issue. And that's one of the biggest things we see. And then we've calculated basically on a system that's generating about 10,000 scans per year, that's roughly about a $3 million upside in profit for a center like that. So for any center, that's a lot of profit benefit by replacing a competing solution.

I just have one more local question. How the patients in Western Australia at the moment receive scan given that there's a service provider in New South Wales?

They -- 2 ways. One is they could go to Envision in [indiscernible]. And both Mat and I mentioned during our addresses that we're dealing with some large radiology providers here in Australia. Once we get commercial agreements with them, then people across Australia, including WA will be able to go for a scan. Once they work through, they'll put it into a single practice first and then they'll gradually roll it out across the network. So if you want to scan now, you go to Envision. But hopefully, within the next few months, you'll be able to go to a range of different radiology providers across Australia.

Just reassure you [indiscernible]

And just to reassure you, my scan is actually going through Envision right now. Okay. Any further questions? Okay. As there are no other formal business has been notified to be dealt with today, that concludes the formal business of the meeting. I thank you all for your attendance and formally declare the meeting closed. That's a wrap. Okay.

Done.

Thanks, guys.

Thank you, Mr. Chairman.

Thank you.