IceCure Medical Ltd ($ICCM)

Good morning, and thank you for standing by. [Operator Instructions] Please be advised that today's conference call is being recorded. I would now like to turn the conference over to Michael Polyviou. Please go ahead.

Thank you, Ella, and welcome to IceCure Medical's conference call to review the financial results as of and for the 12 months ended December 31, 2025, and provide an update on recent operational highlights. You may refer to the earnings press release that we issued earlier this morning. Participating on today's call is IceCure Medical's CEO, Eyal Shamir. The company's VP in sales North America, Shad Good is not able to join due to connectivity issues, so I will read his prepared statement. Shay Levav, the company's COO, will be available during the Q&A portion of the call. Before we begin, I'll now take a moment to read a statement about forward-looking statements. The call and the question-and-answer session that follows it contain forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and other federal securities laws. Words such as expects, anticipates, intends, plans, believes, seeks, estimates and similar expressions or variations of such words are intended to identify forward-looking statements. For example, we are using forward-looking statements in this presentation when we discussed the FDA's marketing authorization for ProSense will drive meaningful growth for us. The post-marketing study for ProSense, growth in the interest installation of ProSense systems in a growing pipeline of customers, including medical clinics and hospitals, potential increases to CPT code reimbursement and rising level of interest or ProSense from breast radiologists and surgeons. The forward-looking statements contained or implied during this call are subject to other risks and uncertainties, many of which are beyond the control of the company, including those set forth in the Risk Factors section of the company's annual report on Form 20-F the year ended December 31, 2025 which will be filed with the SEC on March 17, 2026 and is available on the SEC's website at www.sec.gov. The company disclaims any intention or obligation, except as required by law, to update or revise any forward-looking statements whether because of new information, future events or otherwise. This conference call contains time-sensitive information and speaks only as of the live broadcast today, March 17, 2026. I will now turn the call over to IceCure Medical's CEO, Eyal Shamir. Eyal, please go ahead.

Thanks, Michael. As we previously disclosed in early January, we had a record fourth quarter sales of approximately $1.3 million leading to a record revenue from sales of $3.4 million for the full year ended December 31, 2025. Our growth were driven by a record U.S. sales reflecting the positive effect of the U.S. FDA clearance in low risk early-stage breast cancer and continued growth adoption of ProSense in key markets. In the interest of time and since Shad and I have several exciting topics to discuss, I ask that you refer to the press release we issued this morning for the full financial results. This morning, we will focus on IPO's strong global commercial momentum driven by regulatory approval, new medical society guidance recommending cryoablation for low risk early-stage cancer and the growing body of independent studies demonstrating growth and efficiency and safety and a market increase in awareness and the importance among those doctors and patients in the U.S. and abroad. Following the U.S. FDA clearance of ProSense in October 2025 for the treatment of low risk breast cancer in women aged 70 and over as well as patients who are not suitable for surgery, we believe that most notable recent catalyst for adoption of ProSense in the American Society of Breast Surgeons, the ASBrS 2026 statement. As we announced last week, the ASBrS now recommends cryoablation as an option for selected patients with biological low-risk early stage breast cancer. We are very pleased to see cryoablation receive deep recognition from a leading professional society, representing our targeted end user and believe it could represent a significant catalyst while further validation, validating ProSense's role in modern breast cancer care as an option that prioritized outcomes, cosmetic results and patient choice. This recommendation supports patients and doctors in their decision-making to all cryoablation, it also supports further expansion for reimbursement. As a reminder, ProSense is the first and the only FDA-cleared medical device for the treatment of breast cancer. We don't anticipate other companies to enter breast cancer cryoablation devices into the market in the U.S. anytime soon as the FDA market in authorization established that any other company wishing to file 510(k) marketing authorization for different cryoablation systems to treat breast cancer, will be required to submit full [indiscernible] for follow-up data from its clinical study. As you have seen in our recent announcements, in the U.S., our growing pipeline of customers, including medical clinic and hospitals are converting to signed contracts, deliveries and installation of ProSense. In addition to those like [indiscernible], [ imaging ] and Thomas Hospital, which we announced there are prominent hospitals increasing their ProSense installation and procedures that [ can't be named ]. One of this is a large university hospital in the Southeast. Another is considered among the world's most highly regarded medical institutions, and it now has a ProSense system at two of its largest facilities. We believe there's an opportunity to install additional systems with this prestige hospital network. I also want to point out that the last two2 customer announcements has been clearly commercially focused. They are not part of the post-marketing [ study ] process. We do expect momentum to grow driven by both patients and doctor demand as each new installation and the flywheel effect. For example, in the recent ProSense installation at Thomas Hospital in Alabama, which we announced in February, led by a very engaging media segment on a local news. The segment was broadcast on February 25 on WKRG as a CBS affiliate in Fairhope, Alabama. We invite you to view the community story and the need it provided in our earnings release, which was issued earlier today. One of the doctors at the hospitals describe cryoablation with ProSense as the live-giving life-extended technology that successfully cured a 90-year old breast cancer patients in 30 minutes. To really make this point, the doctor goes on and that you cannot even get a pizza in that amount of time. We believe organically [ driven new ] similar to this in local markets with right patient demand. As for our medical conferences, we have 231 in the U.S. in April The Society of Breast Imaging Symposium and American Society of Breast Surgeons' annual meeting where we will engage directly with our target audience. While we have consistently attended and exhibit, at best, two major new conferences in the past to educate the medical community, we expect that with the FDA clearance and the ASBrS recommendation creating a sense of urgency and doctor will be able to immediately act upon the interim importance. As a reminder, this will be the first time ever we will be able to promote ProSense for breast cancer. As expected, the level of interest from radiologists and surgeons is rising with about half of our customer pipeline stemming from each of the specialties. I will turn now the call to Mike and team who will provide more details on the U.S. commercial activity. However, first, I want to comment further on global sales momentum for ProSense. Our assumption that the FDA clearance will drive demand in other markets were ProSense already had approval for breast cancer is being proven. Regulatory validation in the U.S. has increased confidence and adoption internationally especially in Europe, reflecting strong demand and expanded market presence. In markets where IceCure already had activity, we have seen expanded business to include new clinical applications particularly, breast cancer and other interventional oncology indication. Yesterday, we submitted a Class III amended application to Health Canada seeking to expand our current regulatory approval to include use of the ProSense cryoablation system for the treatment of early stage low-risk invasive breast cancer in patients age 60 years old in August. The applications supported by the data from our ICE3 study and the U.S. FDA marketing clearance of ProSense in the treatment of low risk breast cancer. Under the proposed indication in Canada, up to approximately 7,130 women diagnosed with low risk breast cancer would be eligible for cryoablation. We expect that a decision from Health Canada on our applications during the second half of 2026, subject to the agency standards with new procedures and potential follow-up questions. Globally, evidence-based data and peer-reviewed presentation and abstracts are enhancing ProSense's agitation and the independent studies are currently underway will further increase global exposure to ProSense. For example, the SIX study led by Dr. Vanessa Sanvido and renewed breast surgeons in Brazil and the PRECICE study in Italy led by Professor Franco Orsi, an interventional radiologist and key opinion leader are expected to contribute meaningful clinical evidence. Additionally, the trials are being heavily promoted on social media to recruit patients rating exposure and awareness of ProSense among patient community and advocacy. In 2025, we had a record number of peer-reviewed publications in ProSense presentations and we have had several more in early 2026. In 2025, [ 63 ] principal investigator presented data at 10 conferences across the world from the U.S., Europe and Asia. We are encouraged to see a growing number of international conferences that are now adding new breast cryoablation [indiscernible] to educate doctors about our minimally invasive options. [ Best ] presentation, combined with independent study and publication significantly increased global exposure and drive growing demand for adoption of IceCure systems for breast tumors and breast cancer care as well as other indication of which ProSense is approved. I will now hand the call over to Michael for more insight on the U.S. American markets. Michael?

Thank you, Eyal. We've known for some time the level of interest in the U.S. for ProSense for breast cancer driven by IceCure's active participation at medical industry conferences in the 19 ICE3 clinical site. Also, the strong interim in the final ICE3 data has enabled interest in continued building along with each successful milestone submission for FDA clearance, the outcome of the FDA's advisory panel, then, of course, the FDA clearance itself. Today, I believe 3 factories have converged to accelerate adoption in the U.S. The first, ProSense's FDA cleared; second, we establish reimbursement; and three, the ASBrS' new guidelines recommending cryoablation for low risk breast cancer. We are experiencing a clear uptick in interest and engagement from patient facilities. Eyal has already shared some of the newest customers based on our increased activity in the fourth quarter of last year and the first quarter of 2026. We believe we will close an increasing number of system sales and installations during the second quarter, with continued growth in the subsequent quarters of 2026. We are increasing our U.S. commercial organization to address demand. Our core sales team is working hard on the ground at sites and priority territories that we are targeting. By the end of the year, we intend to triple our commercial team in alignment with growing momentum and demand with the aim of getting broader penetration across the U.S. Our customers are already performing ultrasounds and needle biopsies on a routine basis, a procedure that has many of same skill sets needed for cryoablation. Furthermore, ProSense is easy to implement and doesn't need to access the hospital's IT systems. From a hospital perspective, no additional infrastructure investment is needed. We believe the ultimate champion within the hospital and clinic are the surgeons and radiologists that are delivering care. Our desire and goal is to approach the departments that are directly delivering care. Depending upon the size of the customer, ranging from small privately owned clinics to the largest and most prestigious hospital networks in the U.S., the sales cycle process from lead to contract installation can take, on average, for a few months to 9 months. While interest has been very strong amongst potential customers who want to use ProSense commercially, we are also seeing a lot of interest from clinics and hospitals that want to join our recently FDA approved, post-marketing study and use ProSense commercially too. Many of the sites in our customer pipeline have been waiting for the post-marketing study [ to commence ] before they acquire a system. We expect that our post-marketing study will significantly accelerate the national rollout and availability of ProSense. The FDA's requirement to have 30 sites for the PMS. The majority of these 30 sites have been identified, and we expect to begin the onboarding process the next 3 to 6 months with all 30 to be opened by the end of next year. All of the PMS sites will commit to performing commercial procedures outside of the study patients. Patient enrollment is slated to commence in late summer with 20% enrollment by this time next year. As a reminder, the post-marketing study procedures are eligible for reimbursement. The CPT 3 code, which covers our facility cost, is about $4,000. However, following the FDA clearance for ProSense, the company has applied for transitional pass-through or TPP payment, which may result by early '27 an additional up to $900 per procedure. We have also been working with medical societies and associations to submit the CPT 1 reimbursement to cover the physicians costs in the second quarter of this year. We expect a response by early '27 with a CPT 1 going effective in early 2028. We are highly encouraged by what we are experiencing in the U.S. market and believe we can see similar trends in Canada that ProSense will approve there for breast center. Eyal has already shared with you about the strong momentum in growth markets in part due to the FDA's [ clearance ]. We are working hard on getting ProSense into more clinics and hospitals so that more women can have noninvasive options for breast cancer. I'll now turn the call over to Ella for Q&A. Thank you.

[Operator Instructions] The first question is from Kemp Dolliver of Brookline Capital Markets.

Great. Could you walk through a little more detail with regard to your plans to get reimbursement coverage beyond Medicare? I think you probably have to approach the Medicare Advantage plans possibly VA and maybe some other smaller segments to get coverage across the approved population?

This is Eyal. Thank you for your question. I will refer it to Shay Levav, our COO, who is also covering regulatory and reimbursement. Shay, please.

Thank you, Eyal. So regarding reimbursement, we currently operate under the CPT 3 code with very attractive payment of $4,000. And as we see post FDA approval, we see that reimbursement has been more consistent. We do have in place [ a payer ] outreach program, which we approach private peers. We are focusing on the Medicare advantage program because of the population that is on our own labeling that we got from the FDA. And in addition to that, we are continuing to work on increasing payments and, of course, transition into CPT 1.

Great. So one other question, as you proceed with getting CPT 1 code in place, do you see that as spurring additional demand, significant additional demand? Or is it really just a matter of getting better reimbursement given what you've seen so far in the market?

Yes. Kemp, thank you. As we all know, CPT 1 is part also a standard of care in the U.S., of course, we are planning to grow in '26 and in '27, but we believe that our next coming inflection point, which will be early '28 after we will get CPT 1. So of course, it will improve total reimbursement, but we believe that it will be an important point that IceCure will be able to grow much faster and higher.

The next question is from Anthony Vendetti of Maxim Group.

Just a couple of questions. So on the 30 hybrid commercial clinical sites, I know you mentioned that more than half have been identified. Can you get a little more specific? Have you identified at least 20 or 25? And then just talk a little bit about the ramp because I know you've been preparing for that. How quickly do you think you can ramp that up? And then I just had a question on Japan and then Canada.

Shay, please under your responsibility as the COO, you could answer firstly on the number of sites that will be part of our PMS and also on production and manufacturing ramp-up.

Yes. Thank you. So with regard to the post-market study, we are required to have 30 sites. We see very high interest from those sites, we already identified, although still in the early stages. The sites that are needed for the study. And now the team post FDA approval is working with the CRO to make sure that decides meet all the requirements, and we can convert them to both the PMS side and also being commercial at the same time.

So all 30 sites have been identified and each one of these sites, these clinical sites, one of their requirements for most, if not all, of those sites, is to also be a commercial site, which it sounds like most of them would want to be as well. They've been identified, and it's just a matter of your team to go through the requirements to officially become a clinical site. There's some people work associated with that and you have a CRO assisting in that. Correct?

Yes. I will just emphasize that we identified the sites. We have a high interest for sites across the U.S. We haven't signed all agreements related to the post-market study. This is still something that is in process. But based on the interest and the work that is being done, we have a lot of confidence that we will move forward fast with those sites.

Okay. And then you also announced that you filed in Canada for regulatory approval, hoping to get that before the end of this year. Can you talk about the opportunity there? Because I think the age there might be lower than here, right, because it's [ 70 ] and above here, in Canada is it 60 and above? And then what's the opportunity there? And then lastly, just an update on Japan. I think you're working with Terumo, which I believe is the largest medical device company there, to file in Japan. So maybe just address those two, that would be great.

Eyal, do you want me to address those?

Yes, please.

Okay. So with regards to the indication that was submitted in Canada, we submitted for the ICE3 indication, which is [ 60 ] and above. This represents around a little bit more than 10,000 new cases every year in Canada. In Japan as well, you mentioned, we are working with Terumo and post FDA, Terumo has already started the process with the PMDA. They already had their first general consultation with PMDA, they got positive outcomes with some comments to address. They are planning to have another discussion with the PMDA and immediately after to do the formal submission in Japan.

Thank you. We have reached the end of the call. I will now turn the call over to Eyal Shamir for concluding remarks.

Thank you all for joining us today on the call. IceCure is now at a clear turning point with the FDA clearance and Medical Society recommendation in the U.S., our commercial pipeline is growing, and we expect to convert this potential customer into ProSense installations so that women can have a minimally invasive option they deserve. Have a good day, everyone. Operator?

This concludes the IceCure Fourth Quarter and Full Year 2025 Results Conference Call. Thank you for your participation. You may go ahead and disconnect.