InMode Ltd. (INMD) Earnings Call Transcript & Summary

Hi. Thanks for joining us. This is Matt Taylor, UBS' U.S. medical supplies and devices analyst. And I'm really pleased to be joined for our second session here in the MedTech Innovations Virtual Summit by the management team from InMode. And so we're going to talk today about InMode's technology, their differentiation, all of the things that they do differently to really stand out from the pack in MIS aesthetic surgery. With me on the call is Moshe Mizrahy, the Chairman and CEO of InMode. We also have Spero Theodorou, the Chief Medical Officer; Dr. Michael Kreindel, Co-Founder and the Chief Technical Officer (sic) [ Chief Technology Officer ] of the company; Shakil Lakhani, the President of the North American Sales Organization; and Yair Malca, the CFO. So thanks to the whole team for joining and really looking forward to a deep-dive discussion on the technology today, guys. So let me get us started. I want to focus everybody on the technology and the company. Maybe you could just give us a little bit of background to start, talk about a brief history of the company and your vision for the company at a high level.

Okay. Thank you, Matt. This is Moshe. Well, the company was established in 2008 by Dr. Michael Kreindel and myself. I will tell you a little bit about the experience of both of us. We know each other from 2004 when ESC Medical, one of the first company in medical aesthetic, was established in Israel. We've been working together for -- ever since, more than 25 years. We were the co-founder of Syneron Medical, which we founded in 2000 with Dr. Shimon Eckhouse. And in 2008, we established InMode. The company was registered in 2008. We started operation -- R&D operation in 2009. It took us about a year, 1.5 years to come up with the first technology that we have developed, which is the radio-frequency-assisted lipolysis. So what was the idea behind this technology? When we left Syneron, Dr. Michael Kreindel and myself, 2008, 2009, the laser industry was saturated. What does it mean saturated? If everybody know, the laser industry started in late '70s, beginning of the '80s. There were about, I would say, 10 big companies and 20 others competing on every deal. The IP of the laser was in the last stage before expiring. Laser is something that everybody know how to do. Laser can treat topically, hair removal, all kind of pigmented lesion, vascular lesion. At that time, from a technology point of view, Dr. Michael Kreindel and myself said, "Why can't we found a technology that can do body and face reshaping?" What does it mean? It mean not replacing plastic surgery, but doing something like a plastic surgery for patients who wants to get the results of a surgical procedure without going under the knife, without going under a full anesthesia and a full surgical procedure. And therefore, the technology that we selected were bipolar RF. RF, it's not an optical energy. So it can go almost as deep as we want. It's an actually blind energy and we will discuss the technology further, bipolar versus monopolar. But the mission statement of the company at that stage was to create the new, I would say, gold standard for the aesthetic surgery, meaning enabling many patients who do not want to go through a full surgery using our technology in order to do it in the doctor clinics, outpatient treatment without all the shortcomings of a full surgery. That was the mission when we started. Today, when we look long-term, and we do have a plan for 5 years and a plan for 10 years, we see this company going and expanding operation and R&D and develop technology in the minimally invasive surgery, not just in aesthetic. We are expanding to wellness. We are expanding to gynecology. We are expanding to ENTs. We're expanding to ophthalmology. Soon, we will expand into our urology and other area that we believe that minimally invasive with our technology can be applied. I believe that right now, we are just searching the, I would say, the little bit of the potential of this technology can achieve in the future. This is, in a nutshell, the mission statement. We are growing very fast, about $50 million every year. Except this year, when we lost a full quarter because of the coronavirus. But even in this year, we will do better than last year, a little bit, but better than last year. Hopefully, in 2021, we will continue the momentum like we had in the last 3 years before the COVID-19 crisis. And we will go and reignite the momentum and grow with the same, I would say, speed at the same level that we had before. Did I answer your question, Matt?

Yes, that's a great start, Moshe. Thank you for that. Maybe I'll have you go 1 level deeper and just stay on the market opportunity for a minute. You mentioned some of the unmet needs that your technology was designed to address. Could you talk a little bit more about that and this concept that you have introduced about the treatment gap that exists in the plastic surgery and aesthetics world. And so how do you size this?

Yes. I will ask Spero to get into detail, and maybe Shakil will complement him. Spero, please.

Thank you very much for the question, and it's always a good hearing from you. The treatment gap, it's a quite simple concept because it reflects what's really happening on the ground in the world of plastic surgery. So especially as it relates not just to skin tightening, but the type of patient that's been currently addressed mostly by injectables and ineffective treatments as far as medical devices are concerned, energy-based devices. So on one hand, you have fully invasive plastic surgery requiring hospitalization. But the results do last a long time, but there's a lot of downtime involved. On the other hand, you have all the large industry of lasers, which gives you a noninvasive modalities, which gives you results, of course, but they're minimal results because it's not invasive by nature and a lot of the spas are also carrying that kind of technology. There's a in-between group of people, usually -- so the ages between 35 to 55, that are just not ready for a big operation and are frustrated by the lack of other modalities that would help them get what they want in the meanwhile. And this reflects a big gap in our current treatment up to now, which they want something that can be done in the office under local anesthesia. At the same time, they want a long-term result. So people are just tired of going back and forth to the office every 3 months and doing these sort of treatments in the past that have not been effective. And at the end of the day, financially, it's also something that doesn't really help. So they want to be able to go in the office, have a treatment of 45 minutes, even up to 2 hours max, and then that result will last 8 years. So that's where the minimally invasive nature of our technology comes in. Gives a long-term surgical result equivalent to a normal fully invasive plastic surgery. And -- but it's delivered in the office, away from the hospital and this is the type of patients we need. Now it also addresses, in this treatment gap, the patients that would never consider something like this because it was just not available. So the ability to tighten skin without scars is the holy grail of plastic surgery. And I'm not saying that we've gotten to that point yet, but we're further along than anyone else, and that's sort of the core philosophy and addresses also -- the total addressable market, as you can imagine, is quite big. So just to summarize, 3 very basic concepts, right? If a patient comes into your office, as you know, Matt, I'm a practicing plastic surgeon, so they ask for BOTOX to paralyze their muscles, and then they ask for some sort of filler to fill up certain wrinkles. But they're missing the third part of the element is skin tightening. And up to now, it wasn't really as effective. And this is where we come in to disrupt everything and provide it and package it in a minimally invasive way with a long-term result. So this is having a lot of resonance, especially right now during COVID when everyone's afraid of the hospitals and afraid of anesthesia, we fall right into the sweet spot. We saw this happening in '08, but now we got the technology to back it up.

Yes. And Matt, just to chime in. It's Shakil here. So I guess looking at the competitive landscape and the overall market opportunity, Spero touched on the TAM. But based on the training programs that we've developed, we are putting this technology in the right hands but there's a lot of physicians who have a surgical background that also want to do something a little bit different just to so -- due to what's going on with managed care right now. Reimbursements are going down, their costs are going up. So we've seen that for the last few years now, but there's never really been any competitor that's been able to successfully make it in this particular space. And over the last 3 years, I think we've done a good job implementing this, but really locking out anyone else based on some of the proprietary aspects of the technology itself.

Right. Right. And well, you guys brought up a couple of interesting things that I wanted to discuss. And so maybe I'll talk about the COVID trends first. Because part of this innovations day, we wanted to focus on things that have a bit of COVID theme. And so I think there's kind of a 2-part theme here for your business. One that Spero mentioned was there's some hospital avoidance, and people don't want to have big surgeries. And so that could steer people to more minimally invasive options. And the other one, I read an article on Bloomberg yesterday, is that COVID, with people at home, and they have more time to convalesce. They may have some more money actually because they're not going out and spending money. And they're also on Zoom calls all day long. So they want to look good. So they were saying that, that's caused a little bit of a mini-boom in plastic surgery. And I know that you guys talked about a record month in July. So I was hoping maybe you could just expand on those 2 themes, the office space, minimally invasive, and the impact of COVID on plastic surgery.

Sure, Matt. So essentially, COVID happened during high season for plastic surgery, which traditionally is between January and July, where most -- at least for the bodywork, a lot of the bodywork is done, too, but just people in a better mood. That's always been the high season for plastic surgery, majority of the revenue comes in during that time. So you take away those 2 months, the demand is still there. So what you're seeing in July, what we're seeing in August all the way to September, is part of that compression that took place and the increased demand that came out of it. You add the psychological factor, which is huge, right? This is disposable income, and this is about people being locked up and finding a way out. And normally, finding a way out would be jump on a plane, jump on a boat, go somewhere. So they can't do that. So spending time on themselves makes complete sense, adding the element of Zoom, of course, Instagram, all of these are very, very positive things and have a huge effect. However, what's managed to happen is that the U.S. population, especially, got to learn what a ventilator means. They knew that anesthesia is scary. But now numbers coming out that say 80% of people that go on a ventilator have a really hard time getting off and the mortality associated with that. So you went from what -- went from a healthy fear of plastic surgery as far as anesthesia is concerned to a complete paranoia. So unless you're offering something under local, awake and, of course, the noninvasive component, which we've also offering right now with the Evoke and Evolve, which is basically a hands-free, which fits in perfectly into social distancing, those 2 elements have really, really helped our doctors do very well. Now Matt, I talk to doctors all over the country all the time for a thousand different reasons, and it's been very hard -- the ones I'm able to get on the phone -- it's pretty hard to get them on the phone because of this huge demand that's sort of happened now. We expect this to continue just healthy, like before. Maybe it's not going to be as huge as you see right now because of the compression that took place. But I think there's a fundamental change happening right now in plastic surgery, where there's more people coming on board because of the technology associated with the Zoom calls, because of the psychological aspect. People just want to take care of themselves, are looking healthy. You'll see the elements that play into luxury. You hear about glamping. Your team got healthy. You hear about increase in gym memberships, which are virtual. People are taking care of themselves because they rethought about how they look at life. And part of that element is you only live once, let's look good and that's what's different from the financial crisis in '08. In '08, you said you got to look young to get a better job, et cetera. This time is different. This is more of a splurge that happens because of a reconsideration of how people look at things. And they're falling right into the luxury market. This is not just us. If you look at the top-end luxury brands for fashion and consumer, they're doing okay. And even though our patients are not necessarily the 1%, there are middle-class patients as well, and the fact is we've been able to offer for these treatments because of [indiscernible] available to a lot of people because you have 3 elements. And I'm sorry, I'm dragging on here, but I'll just sum up, Matt. You have anesthesia fee, you have a hospital fee and you have a treatment fee, a surgeon's fee. The patient only has 1 number in their pocket to be able to spend. And here is where it goes. They don't care if you have to spend at the hospital or the anesthesia fee. For them, it's just 1 number. If you eliminate those 2 elements, which we are, and you're just paying the surgeon, now you're getting a really good-quality-type surgeon because it tends to be surgeon who's got more experience, tends to charge more. You're getting the same surgeon and that with the same amount of money. So that element comes in. Because of our technology and the way we're offering it allows people to have procedures they could not afford previously. So all those sort of -- all these things tie in, Matt. Sorry for the lengthy answer but I want to give you a comprehensive answer.

Yes. No, really good perspective there and makes total sense that you're seeing a little bit of that splurge happen, which has given you the short-term benefit. So given we have a technology focus today, I wanted to kind of double-click on the differentiation of some of your key products. And Moshe mentioned, in the beginning, a little bit about how the technology was founded and developed differently. But maybe we could spend another minute on just hammering down on how the bipolar technology is really differentiated and better. And also wanted you to highlight maybe some of the new platforms, the noninvasive. And lucky for us, today, you announced that you're introducing the Morpheus8 and the Morpheus8 Body fractional technology. So probably worth a minute on that. Yes, I don't know who we should go to. There's probably a lot of perspective here.

Michael. Michael Kreindel will answer. Michael Kreindel will cover.

Yes, Dr. Kreindel, why don't you cover the bipolar aspect and then I'll jump in and talk about the platforms?

So first of all, we -- in contrast to a laser, which each device gets single wavelength, single power duration and it's locked with some parameters but not very versatile, we are do whatever is better for patients and product. RF is very versatile technology. It allow us to design electrode penetrating in different depths. It can be ablative, calculative, just heating. We can create any profile of the -- thermal profile on the tissue. So we not look only RF and not look only by bipolar, even it's -- most of our products based on this technology, but we're doing whatever is better for patients. And if you look even on the market and there is maybe a business of laser, it's about $5 billion in the world, while RF business is $200 billion. And it's not occasionally such a good company like Medtronics, Boston Scientific is either focused on RF. And of course, there is element of cost of energy, but also it's versatility because most important, it must work for the patients and it must developed for the doctors, to be reliable, versatile and address different individual features of each patients. So I also wanted to add what Moshe discussed at the beginning. When we found the company, it was 2008. It was a globe financial crisis. We saw very obviously that professional market, a market of plastic surgeons of dermatologists and professional doctors are much more stable than spa and they overcome this crisis much easier. So because we built our company like you build your investment portfolio, we want something that is very stable, versatile, address the -- split the risks and -- between different technologies, applications and overcome the -- and able to overcome the crisis. So -- and our strategy from the beginning was address the most professional segments of the aesthetics and the well-being market. And it's not only decision. Products must to justify this decision. So if you go to plastic surgeon, results of the treatment must to be surgical grade. So it's not like what some companies do in -- like focusing on spa market, doing like 10 treatment with some minor improvement. So we need 1, maximum 3, treatment and obvious results. So -- and technology we develop mostly prioritize the category of electrosurgical. So it's a surgical minimally invasive devices. And we try to cover all range of applications, and the latest one approved by FDA is Morpheus. Morpheus is only one of products based on our RF fractional, RF technologies. And recently, we was cleared to market devices with treatment up to 7-millimeter depth. It's twice deeper than anyone else in the market. Also, there was approved this new body tip, which is the biggest in the market. It's about 7 square centimeter, the spot. So it allows us to treat a body fast and efficiently. And having this combination of large area and large and versatile depths will allow us to remodel -- deeply modeling of the tissue. It can address quite a deep fat, papillary, reticular dermis and also to do skin resurfacing, improving skin texture, resurfacing the epidermis. So we cover all the stage. But when we develop technology, we -- technology is a little bit different from application. We developed this deep subdermal fractional RF technology and it address multiple applications. So when we think where to put our money and how efficient to spend money in R&D., we always try to see depths of the product. And this fractional technology, of course, we started from, most of this, for facial remodeling. But then we move to the neck. Then we are going -- now we are going to the body. It creates some opportunity in labiaplasty. It creates some potential applications in intravaginal area for gynecologists. So also, we are thinking about applying this technology in intraoral area. So when we develop technology and we invest our money in this development, we always think how to get from that more than 1 product. But when we have technology after that, Spero and our clinical team involved already to develop specific applications because the development of applications, it take a lot of time. It's work with third parties, with doctor, it's less dependent on you. It need much longer follow-ups. So clinical development is very significant part of our business.

Yes, so Matt, just chiming in. Thank you, Mishka. So Matt, basically, I know you had asked a question about our other technologies. So obviously, we launched our noninvasive, which we've talked about before, but what makes it a little different in the competitive landscape, going to your question, is basically, we're able to -- we have one of the devices or the applicators like Mishka was talking about, we make different applicators for different device or different applications, of course. And basically, in this, we have the only platform in the market that can tighten the skin, that can trim fat and basically, that can tone the muscle with the Tite, Trim and Tone, as you know. So from a competitive landscape, why is that different? Well, there's no other technology that's able to do all 3 in 1. So the actual value proposition for the end user becomes significantly stronger. And we've seen that over the last few quarters since we launched. We're starting to dominate a lot of the market share. As you all know, from the -- in the past, companies like Zeltiq with Coolsculpting, we've seen them slow down dramatically after they were purchased by Allergan and then AbbVie. And on our front, we've actually seen some tremendous opportunity there. Now on the other side, with Evoke, which, again, going to you asking about some of the newer devices, with Evoke, it's the only platform that can actually -- is used for subdermal remodeling for that lower 1/3 of the face, which is a huge, huge, huge market. And going back to what you were saying about COVID, many of our offices are actually using both of these treatments as hands-free treatments but also COVID friendly. So we have things all over social media with different physicians strapping it on the face, leaving the patient in the room, coming back in 25 minutes later, even calling it a 2-touch treatment, which is actually pretty unique, and we kind of helped design that and address that. But we're starting to see in the, I guess, you could call it the new world, at least for now, we're starting to see that be a big deal. As to the launch for today, Mishka explained to you, we will be the only company -- others like to tout that they're deeper and it's better and yada, yada, yada, but we'll be the only company that's able -- again, like Mishka said, we started off with RF fractional technology on the face and we're looking at different applications. But for today, what's most important is the actual body side of things, being able to do full-body microneedling is not something that anyone has ever done before. So we are getting 7 millimeters deep, right to the depth that we need to go, and we know this from our other technology, of course, and that's going to be a huge lockout spec versus any other microneedling device in the marketplace simply because we have the technologies. We have them all [ on 1 ball ] [indiscernible] [ have actually been thirsty ].

Super. Yes. Maybe I'll... Yes, go ahead.

And Matt, maybe one last thing for you to help you out with the doctor perspective. When you look at liposuction under local anesthesia, and I hate to bring in these terms, but from a financial perspective, you have 11 areas on the female body, which is 85% of your patients, that actually you can treat and bill for, and it was -- always been in the domain of plastic surgeons, more so than anyone else. Now you have a dermatologist whose biggest operation or biggest procedure would be a full facial resurfacing procedure for $5,000. Now you're seeing the same dermatologists can actually tighten 11 areas on the body with full-body fractional. So you can imagine what this does for a dermatology practice in this respect. It allows them in some way to actually [indiscernible] is their area where they can treat. So when it comes through financials and return on investment for your machine you're buying, they're looking at this and they're saying, wow, now if I billed for $2,000, $3,000 an area, I'm falling into plastic-surgery-equivalent revenue per doctor under local and in the office, not even local anesthesia. So full-body fractional has a -- is a big deal.

Interesting. Interesting. Yes. So circling back on the Evoke and Evolve. So one of the interesting things I read was about the Zoom chin, I guess. So it's unflattering to have your computer looking up at you at a 30-degree angle, and that seems like a perfect space for Evoke. And we know from your results the last 2 quarters that Evoke and Evolve are really coming strong out of the gate. And I was hoping maybe you could talk about that momentum and how you launch new products as part of your innovation strategy. You've got this new launch coming out. So how does your sales force manage that and pivot to launch multiple new products at the same time?

Sure. Matt, there's a reason I'm not on video right now. It's because of that same little Zoom chin that you're talking about. So when we're launching any type of product, the biggest thing that we think about -- before we even launch it, the way that it works is basically, I find out what's going on in the market. I then take it to Mishka. Mishka does his genius, figures on how to make it, which we're very lucky to have. Once Mishka makes it, it goes over to Spero. He makes sure that it works. It's clinically safe, it's effective. So by the time we roll out our launch, we know that it works. We know that it's safe. Many other companies, rush to market, which we've seen with a number of different technologies. And when they do that, unfortunately, I think what ends up happening is that they try to figure out along the way if the thing works or it doesn't work. So for us, by the time we launch it, the sales force is ready to go. They know that it's going to work. We did our Evoke launch at our national sales meeting in February, and that created a lot of hype for the sales force. But even for something like the Morpheus8 platform, the big thing here is that the -- again, sales reps, they love new technology coming out. It's more money in their pockets, but at the same time, if it's something that's really different, like Evoke, like Evolve, like the Morpheus8, it provides them with kind of, like I said earlier, a lockout spec. So when they're going up against competitors, the idea isn't to make it easy for them. The idea is for them to actually walk in with confidence, to go in and be able to tout a product that they know is going to work, that they know is going to be safe. And more importantly, that they know that they can go back in and sell them another product in a little while, right? So basically, we saw that with Evolve, with Evoke and we'll see it with Morpheus8. Not only are we going to our existing customers who are purchasing because they've done well with their first device, but they're also obviously going after a totally new TAM, right? So I think that's really important to also note because we've had a tremendous amount of success with existing customers buying second units from us because the first or second ones that they buy work and they're making money with them and their patients are happy. If they don't -- if any one of those are missing from the recipe, no one is going to be eating.

Got it. Great.

Hey, Shak, can I just add to what you just said? And Matt, this is important. The reason our stuff worked is not because we have a bunch of geniuses figuring it out, other than maybe Mishka. But the thing is we use a crowdsourcing sort of way element to see what the problems are out there, what our doctors are asking and we take that input. Shak's sales force is so attuned to that, right? They're really involved with their customers, and they're coming back and saying, man, I wish I had this or man, I wish that. And taking all that information and bringing it back, yes, more minds at ease and sort of figuring things out really helps. And that's why our -- the products are really targeted by the time they come out. And that's, I think, one of our biggest advantages.

Right. Right. So that's helpful to understand the process. I mean I think that's one thing that really stands out about the company is how lean and nimble you are and still able to have a very strong cadence of all these products. So I want to pivot a little bit. You brought up an interesting topic that I thought you could expand on, and that's the involvement of nontraditional surgeons with your products for economic reasons. We've certainly seen that. And I know through our diligence, we've seen how much money the practices can make on these products. So it's really attractive from a doctor's perspective. I guess I was hoping you could offer some thoughts on how far you've gone into some of these nontraditional spaces so far and where you think you could take that over time versus other companies that have tried to do that.

That's an excellent question, Matt. So when you look at any other company, the first place they go, at least in the traditional laser or medical aesthetics world, the first place they go is the dermatologists and plastic surgeons. They tend to leave out some of the others. For us, it was actually a little bit similar. However, it was similar for the reason of safety and efficacy. When we -- with the flagship technology that Moshe talked about earlier with BodyTite and FaceTite are minimally invasive, what we didn't want to do because we've seen some other companies in the past launch project -- or products and put the devices in the hands of people that were not necessarily -- or not necessarily should be using it, right? I mean what -- you don't want a pediatrician using a liposuction device. Unfortunately, that was done in the past. Ridiculously, right? So we obviously -- I know it sounds funny, but it's true. So what we would do on our end is basically we got BodyTite, FaceTite, AccuTite into the right hands. We started off with board-certified plastics throughout the other country. We didn't necessarily want to -- we didn't want to limit it, but we had to limit it. So as we limited it and we saw what's safe, what's not, how do we get a proper training program in place, so on and so forth, we slowly started to roll it out. So for the first 1.5 years, we just stuck with plastic surgeons, building our base, and we have probably, by far, the strongest plastic surgery customers out there, no question, with some of the top names. But when it comes to the other technology, going back to TAM, if you're looking at the minimally -- or sorry, the noninvasive market plus the minimally invasive, which we're slowly working into, the minimally invasive now we have our training programs down. We can teach anyone with a surgical background how to do this stuff, which is what we prefer to stick to. But then you have the noninvasive. So with products like Evolve and Evoke, you are definitely seeing an easier entryway into the nontraditional markets, simply because they're now able to do this. And most of the time, they're delegating this. So like, as I said, if it's a 2-touch procedure, put on a headpiece, walk off, take off the headpiece, it makes it really, really easy to do. So the penetration for that market, I still think we have a huge runway, and we haven't even scratched the surface yet. But going to Evolve, going to Evoke, going to Morpheus8, I think that we are going to see a lot more growth. Now going to Morpheus8 and talking about that, what we are going to do is initially, right off the bat, we're going to have certain restrictions as to who can go how deep for a certain period of time. And the main reason for that is, again, we're going to do it just like we did with our minimally invasive. We've done it before. We know we'll do it again. What we don't want -- because negative word travels twice as fast as positive, right? So what we don't want is a couple of people that shouldn't be using it to use it and all of a sudden, they create an issue for us. That's not going to happen. We've kept it so that we're limiting ranges until they're comfortable enough, then we get a sign-off for them and we move on from there. So I think that's important to touch on as well. But that's kind of the strategy.

Yes, if you don't mind, Matt, the last thing is, just to be a little bit more specific because on the technical aspects of this meeting, you have elements, for example, FaceTite, BodyTite, AccuTite, the biggest advantage is block heating that we're creating to cause this tightening. So we took those elements, and we said, how we can transfer some part of this over to noninvasive. And we were up at night for 2 years trying to figure this out because we have such a good reputation in the minimally invasive space to transfer this over to noninvasive, took a lot of thought and a lot of trials. So bringing -- Evoke causes block heatings. So taking those elements from FaceTite and bringing them over to noninvasive, where it's not -- like you're not going to get necessarily equivalent result. But over time, you can get really impressive results, way higher than the traditional 25% change people see in noninvasive, is sort of an element that comes like that. In other words, if you say, FaceTite and AccuTite is a racing car that's only track-ready, how do you bring this out to Ford and the street, make it street-legal. And essentially, that is what we've done. And it's easy to have something powerful. But dialing it down for all the noncore specialties and making it palatable so that they can do it safe and predictable is something that we spent a lot of time on.

Right, right. That makes sense, Spero. And I wanted to use that -- yes, well, I was just going to say, I wanted to use that kind of leader into a dovetail question about expanding into some of these other new markets. Moshe gave us a teaser in the beginning, and you talked about this on your last call. But you have some offerings that you're going to use to move into ophthalmology, to move into ENT, urology, some of these other spaces where RF could be a good solution. So I know you don't want to let the cat fully out of the bag, but I was hoping maybe you could touch on some of those opportunities and the timing as you have a full slate for the next 2 years planned.

Yes. This is Moshe, of course. Actually, we have 2 tracks of expansion. One, Shakil discussed it and also Spero mentioned it on the product level. We just introduced -- we're introducing this week the Morpheus8, which is we consider it as a surgical minimally invasive platforms, mainly for aesthetic and some wellness, whole body. But at the same time, what another track of expanding is to serve other medical communities. And we started with the gynecologist. We came up with the first system, which called Votiva. Everybody remember that in the middle of 2018, the entire industry received a letter from the FDA asking questions about vaginal contraction, vaginal rejuvenation and all this kind of stuff. And if you remember, Matt, we discussed it several times, we decided to not to leave the category, but rather to invest even more than what we did before we received the letter, since we knew that we have a noninvasive, nonablative treatment of women, especially the vagina. We continue with that to sell the Votiva. And right now, we're in the process to develop other applicators to the same platforms, and relaunch it under a new design which is something that we will do, hopefully, at the end of this year or beginning of next year. On the R&D pipeline, we have 3 new categories of medical community that we want to serve. The ophthalmologist with the -- and we discussed it before with a dry eye treatment product, which also will enable the ophthalmology to do upper and lower lid minimally invasive procedure, surgical procedure. ENTs with the mainly snoring but also other apical-type treatment inside mouth. And also, we are now exploring another category, which is on urology, mainly erectile dysfunction and things like that. So this is like a matrix. On one side of the matrix, we are developing more products and more technologies. On the other side of the matrix, we are developing additional medical communities that we want to set -- that we want to sell. Altogether, when you count those 4 or 5 medical communities, the potential in North America is 100,000 doctors and worldwide, more than 200,000 doctors. Now one of the questions that relate to technology that I'm sure you will ask is how we protect the technology. How do we protect the technology? And we have 4 levels of protection. One level is on the science space. We have a very strong IP patent on the science space. One, to protect the RFAL, the other one to protect the fractional RF. By the way, just 3 days ago, we got another notice of a launch for another patent, which we filed on -- to protect the Morpheus8, the fractional RF, which is very important. We just received the launch just on time, 2 days before the launching. So this is 1 level. The second level is patent on the engineering, how we measure temperature. How we measure the amount of energy that we deliver. How do we measure and controlling temperature inside and outside on a minimally invasive when you need to get 70 degrees inside to melt the fat and only 43, 44 degrees outside to contract the collagen and the skin. And the third level is on the trademarks and the design of the product. But the most important, there was another level that we need to mention here, and this is the regulation level. It took us 5 years to convince the FDA that our bipolar RF technology is safe for minimally invasive and other treatment. And I'm sure that any other company who will try to enter this market will have the same situation with the FDA. They ask for many years of follow-up to make sure that there was no adverse effect. They ask for multicenter studies. If it took us 5 years, I believe any other company will need to spend the same time. So those 4 levels of protection on the technology and, of course, on the indication and the application are very important to keep us ahead of the market.

Matt, Spero here. I think the core philosophy, when you're looking at other specialties is very straightforward. Other specialties have not necessarily trained in aesthetic surgery or it's not part of their element and training. That's why they're called noncore. So when we go to them, and you're telling them, look, buy a machine and you're going to get all these patients and there'll be cash. There's -- no insurance can be involved. Immediately, they are scared, right? This is not something they've ever done. They've never invested so much money into something like that. So we find the one thing which they can treat medically, which they have an existing captive population within their practice with an unsolved problem. And that is sort of the way we introduced the aesthetics after that based on that platform. For example, like the ophthalmologist like Moshe mentioned, they have a population already has dried eyes. So they're not going to have to go out there and look for those patients. And then you teach them how to do the smaller things that we discussed, the blepharoplasties and the same thing with gynecologists. So you come in with Votiva, which is more of a medical indication, more of a medical problem. That's our approach to all the noncore specialties, and that's how we're looking at things. I just want to kind of sum up what Moshe said.

But it's not exactly -- Spero, it's not exactly noncore. These guys, these doctors are surgeon. They know how they are core. They're core in their field. But I believe what Matt asking about noncore are people who never did surgery. Is that correct? Or am I wrong?

Well, I guess I was using it in that way but also thinking about just folks outside of the plastic surgery and aesthetics. So all those new fields you're going into.

I mean the definition of noncore is the specialties that do not have aesthetics as part of their core training. So that's how we look at it.

And Matt, maybe I can add a view that's from R&D point of view. Our [indiscernible] started from the skin. And then everyone went to dermatologists and doctors thereon. And it's took for industry about 10 years to launch how the skin react on different way to different type of heat created by laser, by RF and there's so many companies now in this space. In 2007, 2008, people start to work on fat. It's started from Smartlipo then this RFAL. Now we added this fractional subdermal tissue remodeling. And all this area more and more people understand how the adipose tissue react on heat, how to create an optimal way of lipolysis and contract the issue. And I think we are now experts in beating company in this regard. Now recently, we start to look on other tissue, it's mucosal tissue that we have in vaginal area, in mouth, in intraoral and nasal. And this create like the same space like was created with skin and with fat. And we -- I don't know about other work, we're working on basic science just to see what possible to do with mucosal issue, how if it's needed to do some reduced volume, just ablate it or really need to contract it, to shrink it. So we are doing this basic science. And the next step, it's just to create some technology that can do what this clinical effect that we want. And last stage, it will be development of specific application because mucosal issue like treatment in vaginal area, in intraoral, it's completely different goals, completely different applications and really working with leading doctors in different areas such as to develop application, and this work is led by Dr. Theodorou.

Got it. Got it. Thanks, guys. Well, we went a couple of minutes over, but I think we covered a lot of good ground today and really delved into all of these big opportunities that you have. It's an exciting time for the company. And it's been great to watch your success so far, and it looks like you got a really bright future with the strong pipeline and the 5- and 10-year vision. So I think we have to wrap up. I just want to thank you all for joining us today and for everybody on the line for listening. I hope it was helpful and helped further your understanding of this great little company, InMode.

Thank you very much.

Thank you, Matt.

Thanks, Matt.

Thanks, guys. Take care. Have a great day.

Bye-bye.

Bye-bye.