Mentice AB (publ) (MNTC) Earnings Call Transcript & Summary

Hi, and welcome, everyone. It's my pleasure to introduce Mentice's first Capital Markets Day. I'm Christian Binder, an analyst at Redeye that covers Mentice, but this is not about me. Today, we'll hear from a number of speakers, including Mentice's CEO, Göran Malmberg; the VP of Marketing and Sales, Martin Harris; CFO, Ulrika Voksepp; the COO, Jonatan Sjöström. We will also have 2 guest speakers starting with Demetrius Lopes, giving a clinical perspective and Michael Lee, Director at EBR Systems giving an industry perspective. Further, we'll hear from the company's CTO, Henrik Storm and we'll round off with a Q&A session. And without further ado, I want to welcome the first speaker, CEO, Göran Malmberg.

Thanks, Christian. So I will start by just introducing myself. My name is Göran Malmberg. And I'm being -- thank you. I've been CEO at Mentice since 2008. Joined in the Board a year earlier. My background is really in high-tech business to business. I've been working with global commercialization of high-tech products for the last basically 35 years. So it's great to see you all here, and we are really excited to be able to present Mentice and the company and backing on the company for the next couple of hours. So we're going to start with a brief video introduction to just give you a feel for the passion behind what we do. [Presentation]

Good. So thank you for that. So I'm going to go through a bit of introduction here. So this is the first Capital Markets Day for Mentice. We joined NASDAQ First North in 2019. So it's 5 years, since our public offer. And the purpose when we prepared for this or planned for this, they really have 3 main things we want to accomplish. And the first one is to deepen understanding for what we do. I mean going to the products, the purpose, the market, just to give a better understanding for what Mentice does. We also will talk about the strategy -- the updated strategy and what that means really. And then we communicated this morning, which is linked to the strategy, our financial targets. So really great to have you all here, and we will run into the presentation. So first, a quick background on Mentice. We have really been a global innovator and an initiator of the circles in the Asian market since the start of 1999. What we did then back in 2009 was that we made a decision, a conscious decision to focus on just the vascular part of the market. So we talk about -- more about that later. I will talk about a little bit, Martin, Jonatan and Henrik will explain more what this is and why we have made that focus decision. We have a fantastic technology and a portfolio of products. We say we have spent over 400 man years. It's 7 acquisitions really over time that built this platform. I think one of the most important thing is also the purpose. I mean, we have a very clear purpose, and I think that's also comes across in the video that you've also seen, that this is very clear that what we do here is really to health care experts to improve their skills and technique to ultimately provide better patient outcomes. We are a market leader with a great brand. I mean, I think most experts in this field would know about Mentice. So really as a summary, I mean, it's really the team, employees, the technology and the client on networks. Those 3 corner points are what we will talk about today. I'm not going to go into a lot of the details. But just briefly, I mean, we are about 120 people, half of that in Sweden. And since we follow our clients really throughout the world, we -- I think we are selling products in 58 countries or so. U.S. and North America is the largest market, more than 50%. So there, we have a large presence, obviously, but we also have sales and support teams in Japan, China, Singapore, India, UAE, different places across Europe and also South America. Development we have in Sweden, France and Spain and the U.S. We have -- we did present last year or just beginning this early Q4 and 2023, where we presented a result of SEK 274 million in net sales. That's a doubling of size since 2020 and a tripling of size since 2017. So I'm not going to go through any of the details here, but this is sort of a timeline of key events and milestones. But I just say one thing on this slide is that the -- you see how our technology and our position have developed over these years. We look at what we did maybe 20 years ago. We provided a simulation solutions for pretty basic skill set, basic skills, you can say, for residents and fellows in Sweden, 18 doctors basically. And we have moved from that to today, where we work with the most advanced procedures, most advanced clinical devices and we provide solutions for the most experienced physicians. We're going to see Dr. Lopes, here later talking about how he's using our tools. Dr. Lopes is one of the most recognized physicians in the entire world, and he's using our tools. I think that's important to understand. From a market position, we made a decision to focus on this space in 2009. At that time, we have probably about 30% market share, and we probably competed with 4 or 5 other companies with similar size. Today, we are 5x larger. We have over 50% market share, and we are about 3x larger than the nearest kind of competitor. So I've been asked to introduce a bit of what endovascular is, the environment you work on. This would be reiterated by my colleagues later on as well. So from a treatment point of view, we work with everything from head to toes basically. So we have something like 50 different techniques and procedures that we support in our platform. And I would say it's 5 to 7 different specialties, but the main ones are kind of the brain or vascular, everything around the heart and then basically the rest of the body. So we talk more about that. So then again, what is endovascular. We're also using the term IGIT or image-guided international therapies. So it's really the transition from open surgery to minimally invasive surgery. So open surgery, as you know, is where you have an open wound or open incision where you open up around the heart to do a treatment directly on that -- in that place. While the image-guided therapy is really navigating the human vessel system. You go -- you enter in to the wrists or you enter into the groin and then you navigate using basically X-ray up to the target point. So the advantage here is that you have less pain, less anesthesia. Also the procedure time is typically much kind of shorter, which means that the patient can ambulate and move from the operation room much, much faster. So this is really attractive for all of the stakeholders, it's attractive for the patient, obviously, but it's also attracting for the caregiver. So we also will talk about today and I think the ones that have followed us also see that we use the term cath lab. So what is the cath lab? Cath lab is the treatment room, where the treatment you need to have to make one of these procedures. There are something like 40,000 to 60,000 of these around the world. And this is really the X-ray environment where if you place the patient on the table, did physician move the table and you have a X-ray camera on this kind of C-arm. You can see this C shaped part of this environment that you move around. And the physician needs to learn how to look at the screen. So everything he use as a guidance is what's on this actual screen and you need to learn how to not look at your hands. So this is really the ultimate client for us. Everyone that have one of these cath labs is a potential Mentice client. So if we look at the market, there is a rapid transition from open surgery modalities to these kind of modalities and most experts believes that the large majority, 85%, 90% or more of -- on these -- of these kind of therapies will be performed through using endovascular surgery. And this obviously creates a continuous demand for what we do. And we believe that there is accessible market here around basically USD 0.5 billion for this kind of different techniques. So that's the market that we are looking for. So what do we do then? We have a set of products. We're not going to detail explained. I think we will do that later today as well. Our main product is the one to the left, which is the immersive VR simulators. That's our legacy product that we have from start. It's really a combination of an advanced hardware in a software platform and then specific software applications for each kind of clinical procedure. And this is really a way for us to replicate the actual real patient and provide this environment for a physician to practice safely away from patients. Moving on to the right, we talk a bit about the flow simulators, which is really an environment to use for conceptual design, early stage processes in the medical device process, but it's also used for advanced training and really specific unique cases. What we do there is that we have a method to 3D print an actual part of human body and then allow for physicians to deploy or implant actual clinical devices. You can do that under X-ray, but you can also do separately. And then to the right, to the right most here is really a growing area where we see a lot of demand for cloud-based application, mobile applications, also clinical decision to those applications. So that's clearly an area that we want to go into. From a customer point of view or a business area point of view, we really approached the market to 3 main channels. The middle one here is our largest one, medical device, where we really provide solution to help them bring products out to the market in a safe way. So here, we work with I would say, all of the 10 largest medical advice companies in the world. These are companies in $5 billion, $10 billion, up to $25 - $30 billion in size. And then this is a critical part of how they bring products out to the market. And so we have probably a large majority of the 50 largest companies in this world. That is today about 70% of our business. Our ultimate market is the one to the left, which is the hospital market. I talked about the 40,000 to 60,000 cath labs. That's what we talk about there. So far, we have delivered to about 600 or so hospitals in the world, typically teaching institutes. So we just basically scratched the surface there. And then to the right, these are the companies that actually manufacture and deliver those X-ray or cath labs. So that here, we see a large opportunity to really team up them, integrate our products and really work together with these companies to get out to the different cath labs. The 2 business areas to the left and right. Hospital systems right now, it's about 15%, 20% and then the remaining 10% or so is on the partner side. So we will talk about the updated strategic positioning here. Jonatan will talk more about that in a bit. But the 30,000 feet level of this is really that we have talked about this for a number of years since our public offer in 2019 that our focus is this image-guided therapy area and we are continuing really expanding -- vertically expand in this area by adding more technologies, more solutions to really open up that market, the $0.5 billion market that I talked about. So that's the core cornerstone of what we talk about. We are -- in order for us to get to the practice and physician, the more experienced physician, we need to continue to develop our core technology. So Henrik and Jonatan will talk about that more, both from the platform point of view, but also from the kind of application point of view. So that's a really important part. That work needs to continue. And then from a business development, there's really 2 main points here. One is the channel where we see an opportunity. We are still a small company. So we need to work with partners to open up the channel out at hospitals. So here, we see an opportunity to work with companies like Siemens and Philips and others, but also potentially medical device companies. The second part of this business development side is that we really see an opportunity to work more globally and more strategic together with our largest customer, probably a lot is 4 or 5 clients. These are the mega medical device companies I'm talking about. Where we think that the global approach and for us to really become a partner, the ambition is to become a partner for them to really see us as a partner for these kind of technologies. We have a great position with those companies already, but we just think that we can expand our business for them in a much, much better way. And then we will continue to look at strategic acquisitions like we have done. We said we have acquired 7 companies over the last 25 years. But we will continue that, obviously. And I think we have demonstrated the ability to really complement what we have with new technologies. Typically, so far, companies that doesn't have access to the market, doesn't have their own sales organization, don't have the clients network that Mentice have. So the idea is that we can do that. We can add more products to our sales and distribution but also use our existing kind of client network. So this leads us to clarify our financial targets. The previous one was presented back in 2019. But what we want to be clear on here is that we are a growth company. We have the ambition to continue to grow with kind of profitable growth. And we are gradually improving the profitability. We've seen that over the last 1.5 years, Henrik will talk about that, how we have improved the productivity, the revenue per employees, one of the KPIs that we are using. So that's important for us to continue that. And we also say that we are able to fund our own growth. So that's also an important corner stone. So that really, I mean, boils down to the main factor is 20% to 30% of growth on top line net sales. And we also say now given the investment needed in our growth, both from a sales and distribution point of view, from a technology point of view, we believe that it's more realistic to say 20% EBITDA margin for the 3 years period of time. And then we still keep the 30% markets -- EBITDA target, sorry, for longer term. So really my last slide here, in summary, I think what you should remember. I mean, from a capability point of view, I believe and we believe we are uniquely positioned to really take the company to the next level. But really 3 main areas: the technology, the team and the know-how we have and the customer network together with the market share. That's really the capabilities, the unique capabilities we have. And that also presents a significant barriers to entry for other players to -- for their aim to get into this market. We also see that the market is a fast growing. There's some general CAGR between 10% and 15% for any of these disciplines, but there's also a lot of new, completely new areas opening up. So that really continues to open up new opportunities for us. I also think one of the important parts when we made a decision back in 2009 is that we see a clear commercial value for what we do and our products provide a clear value. The underlying solutions have a value, but also the products we provide. So really, it's a great opportunity and I still believe we can capitalize on the success we have so far and the position we have. But obviously, of course, we need to continue to invest in our technology and our next level here. So that's my final slide. I want to hand over to Martin Harris, our VP of Marketing.

Thank you, Göran. Hi, everyone in the room and everyone at home. Sorry -- thank you for joining us at home as well. So I want to complement a little bit about what Göran has been saying, going through a bit more details with regards to what our market looks like. What problems are we solving, what clinical challenges exist out in the community that our solutions help solve. So I've been with Mentice now for around 16 years. And I've been very fortunate to travel the world, and be a part of being in the room where surgery is in high-income countries and also countries where it's a little bit less served countries. It's very -- it's such an inspiring experience. When you see a patient just lying on the table, they've got a family waiting outside. They have loved ones. They're hoping that this patient will be treated to the best of the capability. It's one of the real aspects that drives, I would say, a lot of people at Mentice. One of the points I would like to highlight as well is thank you to the Mentice colleagues and, of course, the external partners for setting up today as well. So as Göran showed with regards to the corporate video that we showed earlier, we're often shown or compared to the airline industry. And most people are aware that pilots, they train on simulators, they practice complications, standard procedures. I just want to take a step back with this message. Imagine that there were only 2 airlines in the world. One airline where the pilots train to proficiency. They trained on new aircraft equipment and new controls, complication management step by step by step until they were proficient. And then there was another airline where the pilots didn't train on simulation. They trained on just as a aircraft went up in the air. I just want to plant that seat because most people would put their family, their loved ones, they would fly on the airline that performs at training. Now of course, there's a lot more details to this subject as well. So I'm going to go through a little bit of the background, a little bit of what the market looks like right now, and I'm going to segment into the medical device industry and then into the hospital side, the health care side of our business. So this is some data from the American Hub Association. They do a factsheet every year that talks about the size of this market. Göran alluded to, he talked about the procedures that we do. Ultimately, it's everything to do with inside the blood vessel. Optimizing oxygenated blood you could say, to travel around the body to the organs to make sure that the human, the organ and the body can work as it should work. Whether it's opening up blood vessels, whether it's taking away clots inside blood vessels, whether it's [ including ] a tumor, let's say, there's a tumor in the liver. These are all the areas that Mentice works towards and supports the physicians in their mission to save more lives. So as we can see here, it's a challenge. There is a clinical challenge out there that Mentice helps off. Göran talked about open surgery with the large incision in the chest and the benefits of doing endovascular minimally invasive. And this is why this market will continue to grow. And Dr. Lopes will talk a little bit about what this world looks like as well from his sight. So the megatrends. And I think most people are aware of the challenges that are occurring within health care. We work with insurance-based health systems such as Dr. Lopes. We'll talk a little bit about later and also when it comes to social system, hospitals and health systems. Part of the challenge is, it's a part of this comment that you need to keep learning, whether it's driving a car, whatever the subject is the aspect is that if you keep learning to proficiency, if you learn the right way, if you have senior physicians, you have experts around you supporting you and they're using a safe environment using technology. This will always -- such as Mentice, this will always help you improve. The chart that we see on the screen on the right-hand side, this highlights some data sets from Illinois in the U.S. that when you have low volume hospitals, maybe health systems that don't treat so many patients. Maybe they don't have that level of high complications versus a large health system, a large university teaching hospital that has more and more and more complicated patients. Of course, the more experience you get usually the better you are. So depending on where you're based, sometimes our solutions can help support those physicians be more proficient. There's a large market Göran talked about the operating room aspect. This is growing. We see data from Asia, from the United States, from Europe when it comes to these procedures are growing more and more. You can see the data on the screen right now. So what affects the aspect of the outcome, whether it's surgery and those aspects. Of course, it's a collaboration. It's working with partners. It's working with technology, improving technology companies such as Mentice. And we have Michael Lee on the call where they will be speaking a bit later from the medical device industry. All these partnerships, all with the end goal to make sure that the patient gets the optimal treatment. So that's a little bit about the background. Now I want to go into the medical device industry and the health systems and how they're connected. So we'll start with the medical device industry. As you see on the screen, the medical device industry is developing medical devices, of course, whether it's metal tube stents that go inside the heart, whether they are catheters and devices that help pull clots out of the brain or prosthetic valves in the heart to help the heart optimize the blood flow around the body. Mentice solutions are being used by the medical device industry all around the world to help train the physicians to proficiency. Make sure that every patient gets the same opportunity. And then, of course, as we see, we have the hospitals. That's where the physicians are. Of course, that's where the procedures are being performed. So using our technology when it comes to training the physicians or supporting the physicians supporting trainees, we're fully aware that it's much safer to train on a Mentice solution than it is on a real patient. And then, of course, at the end of the line, it's always the patient. It's always making sure that the patient has the best treatment possible. So medical device industry. We often talk about the life cycle aspect. So we have one of the largest -- I use an example, one of the largest medical device companies in the world. They will conceptualize a device. They'll identify the clinical challenges that are happening in the community. Something that will help human beings live longer. They will solve clinical issues, typical challenges that are going on. They will use our technologies to help with the clinical testing, they're making sure that this device is FDA cleared or CE marked. They will go through to launching the products and training the physicians to proficiency. Making sure that physicians can use their medical device that's been developed over years and millions of dollars of investment into it to make sure and support that the physicians are using the device, the procedure, patient selection to make sure that this is all optimized throughout the journey. And part of the acquisitions, as Göran mentioned before as well, the 7 acquisitions we've done over time has helped us provide an offering that covers each one of these steps, and that's part of the message behind it. This is an example I'm going to give. One of the world's top 3 global medical device companies, a story recently that came from Alaska. And the reason I'm explaining to give an example of how our customers would use our technologies. There was a patient in Alaska that needed a pacemaker. I think most of us are aware in the room and at home, of course, pacemakers to control the rhythm of the heart basically. This patient was going to be decided to have a certain treatment protocol. This device industry customer approached the physician about the latest technology, whether the pacemaker would have a longer battery, whether it would have a better synchronization. The physician isn't too comfortable. Assure that's plastic models, explain a step by step how you should do. The physician is not content. And then they bring the project, the development project with Mentice and our immersive virtual reality technology. Where we take that real medical device, our engineers will model that specific device, how it moves, how it pulsates, how it's implanted into the body. Our engineers will put that into our immersive virtual reality. Then the company, they would take that to the physician, and they would do these trainings time and time and time again, and so the physician feels efficient. And because of this, the specific patient in question, and it's similar across all of our device industry customers. That patient got the best possible treatment. I'm not saying it's obviously Mentice has a key part to play in this, but it's a device industry. It's the physicians, it's to drive the growth in the market and everyone is all aiming for the same perspective, to make sure the patient gets the best possible treatment. I'm going to touch on health systems now. We've often talked in investor presentations, meetings. We talk about the before, during and after a procedure. When it comes to trainees and physicians that are just learning a new procedure, a new device, Mentice is used quite regularly. The angle of acquiring solutions using more solutions are CE marked, FDA cleared and the work that we've done in that space to go into the department. And Dr. Lopes, will talk a little bit more about this, about senior physicians, and I'll touch on this shortly as well. So the before aspect is planning. It's learning a procedure, learning a device, making sure that you feel proficient sorry, being aware, maybe planning for the unexpected. Communication, talking with the team, everything around that part of the procedure to make sure that patient gets the best possible care. And then during the procedure, the acquisition of Ankyras and the work that we recently did to get the solution FDA cleared. Ankyras, Henrik will talk a little bit more about that. But when it comes to aneurysms in the brain, this software helps physicians place a device inside the brain that will optimize blood flow and help the patient survive in that sense. And this is a solution that we used during the procedure. Can be used before but it can be used during and after. And then after the procedures, our solutions are being used maybe for debrief. The procedures 99% of the time go fine, but there are sometimes where the procedures maybe don't go as expected. You can take that patient anatomy. You could take a scan of that human anatomy, the vessels in the brain or in the body, of course, and then you can put them into our -- one of our flow models with the silicon vessels. You can put that on the operating table, and you can run that again. Time and time again, and you can do an evaluation. Did we use the right device? Was it the correct patient selection. And it helps the physicians and the team and the industry make a more informed decision and obviously evaluate. This is an example from Sahlgrenska in Gothenburg, Sweden. So this is a team training scenario. So this is a partnership with one of our imaging company partnerships as well. Our technology is integrated into the cath lab as Göran said before, the image that we saw with the X-ray equipment and the monitor so the physicians can see into the body. So what we see on the screen is a video recording of Mentice technology on the table in one of the operating rooms, the cardiology operating rooms in Sahlgrenska University, where it's all about complication management. It's all about team training. It's all about making sure that the team know exactly the step by step when it comes to complication. It's a super empowering part to be a part of this where you've got senior physicians educating junior physicians. Then we have one of many, many stories. And the reason why I bring this one up, Dr. David Fiorella from Stony Brook University in New York. He's one of our advisers as well. There's a story where there was a child that had 4 aneurysms in the brain. Imagine this first well, just let's take another step back. You've got a child that has aneurysms in the brain. What do you do? You go to a healthcare provider, you speak to a specialist, they help you. In this specific case, the family traveled to physicians to physician to physician, to health system to health system to health system. No one wanted to touch this child. No one wanted to treat this child because it was too complicated. Dr. Fiorella and the team, they used the technology, the vessels. They took the child's anatomy. They put the model into one of the Mentice flow model platforms and then they tested step by step by step, which part of the anatomy to be treated first. What's the risk analysis of this part of the procedure, step by step by step. And this kind of -- these kind of use cases are being used everywhere. And I mentioned Dr. Lopes a few times, and I'm looking forward to his presentation, which I'll talk a little bit more about this. So my final slide. We saw in the corporate video, there are a few comments about changing the landscape of healthcare and really coming back to the airline industry aspect, there is another way for training, learning, preparing rehearsal to be done. And Mentice solutions are being used by physicians around the world. And a part of this story, I would say we've only just started. So I look forward to the next 50 years or so. Let's put it that way. Thank you. So I would just like to introduce Ulrika Drotz, if you would like to come to the stage.

Thank you. So I'm Ulrika Drotz Voksepp. I'm the CFO of Mentice, and I joined second of January this year. I've been CFO, CEO actually also in different kind of companies in Sweden, and it's always been some kind of growth journey. And to start with telling you why did I choose to join Mentice and really, it's the purpose. It's a very clear purpose really to be able to affect the daily life of a physician to improve patient care and the outcome of treatments. I mean at the end of the day, it could be someone I know where it could actually even be me who will have a better or longer life, thanks to the simulation training or the decision support tools that we are providing. The second reason is also, as both Göran and Martin mentioned this comparison with the flight industry. And the -- by law required training for pilots and to see that is not really required for the physicians and to be able actually to take part in the journey to give that training possibility to physicians. That's really the reason I joined. And what have I seen after 3 months, really strong competence, a global, very dedicated team really being driven by creating impact together with a strong network of different customers, all the way from very large multinational big companies down to the small hospitals in Americas, in the EMEA and APAC, really an established technical solution trademark and a good attractive price point, high gross margin and a scalable business model. So I'm really happy with the 3 months so far. So -- and I'm going to give you the view on why Mentice from a financial perspective. And starting with our performance, what we've done -- I mean we're really dedicated to growing. And over the past years, we've been growing -- last year with 25.5%, obviously to take that question out, yes, we are a global company. So we are affected by FX currency. Last year, it was about 5%. We deal with euros and U.S. dollars when it comes to our revenues and when it comes to the costs, we're talking about Swedish krone. So as many other companies, we are hedging the net inflow in these currencies to have predictability. The attractive price point, a high gross margin in all different product categories, customer segments, together with an increased productivity is really the background to why we have improved performance over the last years. We tend to look at our productivity by looking at the revenue per employee. And last year, we improved this with 30%, which we think is quite good. And to look at order intake, we think it's very important for us to look at rolling 12 months. To us, it doesn't make very much sense to look at a year-over-year comparison for a month or a quarter. We need to look at the rolling 12 months or the full year? And why is that actually, we have big orders coming in, and we cannot really say when they are coming or how big they are. So -- and we also have customers who have a budget here to relate to, maybe they have to spend money to keep the budget for the next year or they have to wait for the new budget. So therefore, we have really not a seasonality or we can say that we have a seasonality that is constantly changing. Looking at last year, we have a strong growth in the order intake. We ended up the year with SEK 304 million, which corresponds to almost 50% increase. And as Göran has been talking about, there is a strong growth in the MDI segment, the medical device industry and a somewhat slower increase in the healthcare systems. If we look at the revenues from a different perspective and looking at the regions, we can see that we have customers all over the globe. The Americas is strong. It has been strong for quite some time. It was a very strong increase last year and obviously, within the medical device industry and a somewhat weaker performance in the health care system. In EMEA, we had a good growth of almost 28% last year, where we still have the good growth in the medical device industry and a somewhat performance in the healthcare system in line with 2022. APAC is the region with the weakest growth last year. It started off very weak, and it was nice to see the improvement during the fourth quarter. And this is somehow also a bit related to the weak performance in China. So when we look at the different kind of revenues we're having, we are selling systems, and software and also professional services and other. And that is mostly development for customers, customer-specific development. And the customer can choose a couple of different ways of how to buy this. Either they make an investment and pay for everything upfront or it's a recurring payment that they are doing. And this can be chosen both for the systems -- and for the software, we are selling something that we call perpetual, which means that you're buying a life-long license to use the software. And then if you want to add on functions and those things, then you have to buy a new license. The other version is to have this bought as a recurring cost for the customer, a SaaS solution. And we also have services like hosting and SLAs and what is then actually affecting the net sales because we are having so much focus on driving the order intake. So the net sales is actually depending on what is the customer buying, how is the customer buying it? And when does the customer want to have it delivered. So therefore, it's very -- obviously very important for us to track the order intake to see the revenue. But again, it's really a year-over-year or a rolling 12 perspective we are having. And talking about recurring revenues. This could be either a system rentals or software rentals, and obviously, the software is the biggest part -- and this is also where we are focusing and Jonatan will come back with some strategic initiatives to describe how we are going to increase this going forward. And as you can see from this slide, we had a good increase of 10% last year. And then there has been a somewhat flattened growth. And most customers buying the software in a recurring revenue perspective, is the healthcare systems, meaning the hospitals. And as Jonatan has explained, we have had a somewhat weaker development within that segment. So that is the explanation to why it looks like this. The order book is really the future revenues for us. So as you know, from our interim report of 2023, you can see that we had a very, very good order book leaving 2024. It was over SEK 150 million. Of those SEK 110 million are scheduled for 2024, which already here indicates that we have in the order book actually orders for 2025 and so on. In this order book, we have the majority of the orders, obviously, related to systems and the subscriptions. So we have a clear target to grow and a clear target to grow with increased profitability. And as Göran mentioned, with the financing done by our own cash flow. And as you learned this morning, we have revised our financial targets to reflect the strategic path and the strategic initiatives that we're going to do. So again, as Göran mentioned before, a growth in net sales of around 20%, 30% on an annual basis. And I cannot stress this enough. We're looking at our revenues from a year-to-year rolling 12 perspective. The profitability to reach 20% over the next 3 years with the possibility of reaching a long-term target of 30% and having this financed again by our own cash flow. So the ambition to grow it requires cash to grow. Again, we are having the aim of financing this with our own cash flow. We will keep the attractive price point with a high gross margin and this together with really the strategic initiatives to increase the share of software sales together with the developing of the OEM channels, as Göran mentioned before. And moving from project to product, Jonatan is going to talk more about this in a while that will increase the efficiency and the internal efficiency on developing, and there are potential of really increasing efficiency in our own operations. And that is going to lead to economies of scale and operations. And as you can see, Göran mentioned it before, and I mentioned as well that we have increased the revenue -- the sales per employee during the last year to 30%, and that is a very important target for us, a very important KPI. And as you can see, we've had a good increase during the next year, and that is 1 of the KPIs that we will continue to track. So thank you very much, and I want to hand over to Jonatan.

So thank you, Ulrika. My name is Jonatan Sjostrom. I joined Mentice during the fall, after spending around 10 years within the Volvo Group. So from a little bit bigger company. So I come to Mentice to bring my experience from a large organization such as Volvo and from my consulting days within -- when I was working for Accenture before the Volvo time. When I was working for Volvo, I had the opportunity to work very closely with the executive management team during the growth journey and the improvement journey under Martin Lundstedt's leadership that has been very interesting. And for the last 6 years, I was VP of Strategy and Analytics in an organization within Volvo called Volvo Group Connected Solutions that was working with connecting vehicles and machines and retrieving data from those machines and building digital services around that. And now I'm at Mentice. And this has been a very interesting, intense first 6 months to go out, meet our customers, understand more from them and what value Mentice can bring, work with our -- understand our products, work with our fantastic global team and working together with the management team on sharpening the strategic agenda going forward, and also detailing those plans that may -- that we will adhere to in order to drive in this strategic direction. I wanted to start off talking about our mission. Göran touched upon it. Ulrika and Martin touched upon it, but this is definitely 1 of the things that made me very interested in joining Mentice. It was the fact that we want to improve patient outcome. We want to be part of saving lives, improving the outcome from patients so that they can have a good quality of life and continue to live together with their loved ones. And this is, as Ulrika said, this is -- you can really feel this in the Mentice culture, which I love. And we do this then by having solutions within the endovascular area that helps physicians to train, rehearse and plan interventional procedures. Göran mentioned that we are working with 3 business areas. So we're working with the healthcare systems, which is mainly hospitals and clinics. Here, mostly we sell solutions that are then part of the training of junior physicians. So before they are doing actual procedures on patients, that's when they utilize our solutions. We work with the medical device industry so that they use our solutions as part of their R&D when they are marketing and launching and marketing new devices that they have -- are introducing to the market and also in the initial training of those devices to practicing physicians that will use them in the patients. And the third area, strategic alliances where we work with these companies to get more value to the physicians out in the operating rooms, in the cath labs. So we're integrating with their equipment. And we're also helping those companies to showcase their new features on, for example, a new cath lab where they can showcase their features on our virtual patient. We have three main or cornerstones towards driving profitable growth. One is product and platform development. The other 1 is that we -- and that we do to improve our margins of our products and of course, to drive volume of our products and solutions and business development where we do investments in order to drive volume. And we do this with a scalable business model. So when it comes to product and platform development, as we're into, today, our solutions are mostly used by junior physicians before they touch a patient. But if you look beyond that, there is so big opportunity to help more senior physicians outside these teaching hospitals. And to put it into perspective, I think you mentioned it in the beginning. So far for the healthcare industry, we have sold 600 systems and put that into perspective of the 40,000 to 60,000 cath labs that are actually out there. And we have senior physicians using -- such as Dr. Lopes, using our products today. But when we talk to physicians out there, the feedback is that we could provide them with so much more value if we took the platform to the next level. And that is very much what our investment in the product and platform will be about to meet the needs of the practicing physician. And what is that then? It's about providing them with a close to life or life-like environment where they can train, rehearse and plan for procedures. And this will require, and Henrik will talk more about this in the technology part of things, but it will be about driving further realism or even more realistic simulation. It will be about provide more complexity and variety of cases. It will be about being able to do its patient-specifically, as Göran was saying too in the beginning, every patient is unique. The anatomy of that patient is unique, and the aneurysm or whatever kind of vascular or heart disease you have is very unique for that patient. And to be able to import data on that specific patient and train on a specific patient, like with the case that you presented with -- in Stony Brook we can train before doing the actual procedure. And in order to be attractive for a practicing physician, it needs to be easy to use because they have a lot of other things that they need to work with as well, and it needs to be accessible, preferably inside the cath lab or even at your -- just a finger click away on mobile solutions, where you can look at your cases, when you get some time off and browse through what will I do with this patient. And while we will work and invest with -- into our platform and mainly very much about the software platform behind this, we will work to modernize the platform, use new technologies. Henrik will mention a little bit about this as well. We want to -- or we will when we do this investment, also make more of a common base between the solutions that we use towards the healthcare systems and the medical device industry. And by doing that, we will also be able to invite the medical device industry to also buy our services and solutions on a recurring basis as well. So that will support that [indiscernible]. And another part that we are investing in is to leverage the capability that we have with our 3 different areas with virtual simulation, with the physical simulation and the decision support tools with Ankyras, to leverage them and put them together to create even more value for the physicians. When it comes to business development, we are putting efforts on our investments in our sales capability. So we are adding salespeople towards all these business areas and around the world. We are implementing now for the bigger clients that Göran mentioned, the bigger MDI clients. We are implementing more of a strategic account management approach, which will allow us to go broader to other areas at that medical device company and also deeper by -- and more of a strategic global account approach. And we have tried this -- or worked with this for a couple of years for 1 of our major clients with very, very good results. And now we're taking this in the next level and adding the same approach for the other big clients. And in the middle part here, the -- another very important area for us is the channel aspect because reaching the senior physicians. One thing is the product. But to reach out there, we think that -- it's very important to work with these strategic alliance partners that we have, like Philips, like Siemens, to integrate deeper with them so that you can really access the simulation solutions directly in the cath labs. And we are working and continuously expanding our network of key opinion leaders out there in order to also get out to further closer to the hospital industry. When it comes to market focus, we are mainly focusing on the U.S., Europe, Japan and China. And as you showed, Ulrika, we are, of course, very, very happy with the positive development in the U.S., and the U.S. will continue to be an extremely important area for us also going forward. And a scalable business model. This started -- is starting to show in the numbers that we really get leverage from our growth. And we want to grow the software part of our things. So the Orange share, we want to grow that with more software solutions and a bigger portion of our solutions being software and developing also add-ons to already sold systems because software in its nature is scalable, and it's also easy to put a recurring revenue attached to that and to have customers have subscriptions on software. And the technology investments that I mentioned before, these will also support our efficiency journey and make our business model even more scalable. So we will have a more modern platform utilizing more off-the-shelf opportunities or capabilities of software. We're increasing the common platform between MDI and healthcare systems, moving away from where we today work with the MDIs on quite specific requirements from them when it comes to the cases that we work on and their specific devices in those cases, so moving away from too much projects dedicated for MDI to more of, as you mentioned, Ulrika, to more of a product approach, where a more common base is used will also support efficiency. And then, of course, as all companies starting to use more of artificial intelligence, both in terms of supporting our software developers with, for example, GitHub Copilot, and those kind of development efficiency tools, but also bringing AI into our products with machine learning algorithms that makes our products better. We're into this as well. We are in the, as we call it, IGIT or the endovascular area. And this is a good area for us to be in because we have a very deep expertise in our employees. We have a sales organization, global sales organization that we can leverage and a strong network of clients, global clients. So we started off with the virtual simulation. We built it out with a physical simulation and then later on with Ankyras and the decision port solutions. And where we go from here into new specialty areas such as structured heart or tools, other tools that are supporting the senior physicians in their clinical workflow or supporting the automation journey that you will mention a little bit more about, Henrik. And I just wanted to touch upon it as well. Acquisitions has and will continue to be an important part of our future. We are continuously monitoring opportunities where we can expand the business of Mentice or the technologies of Mentice to provide more value to our customers, and expand in this vertical that I referred to. It was mentioned before as well, we have reached the FDA clearance with Ankyras, which opens the door to the U.S. market. So we are very pleased with that. And we are also then seeing that we have closed -- we are closing down or we see Ankyras as integrated into the Mentice. And late in 2023, we bought the company, Biomodex, so we have an ongoing integration with that. Now -- and the future focus will continue to be within the vertical of image-guided interventional therapies, where we can leverage our strong technology competence and build that even more through acquisitions. But it's important to mention, we're not buying technology for the sake of technology. There need to be a rather short-term business gain for us to be interested in acquisitions in specific companies. And we believe that finding opportunities where we can continue to leverage our global sales force and client network is a very important part as well. Finally, I want to mention a super important part of the work that we do is to collaborate with what we call key opinion leaders, like Dr. Lopes and his colleagues out there to make sure that we have a sounding board to see that we do setting up the right product strategies, that we are pursuing the right business opportunities to pressure test things. Like, is the solution real enough? What is real enough, et cetera, work very close with these guys. And we are working with -- in all areas from peripheral, cardiovascular and neurovascular as Göran explained in the beginning. So that concludes my part.

So thank you to the audience at home. I'd like to introduce Dr. Lopes, if you would like to come forward, Dr. Lopes. Dr. Lopes is a global voice presence. He is invited to all the top meetings. He's an innovator. Dr. Lopes has utilized a lot of our solutions, but the speech he is about to give and the presentation, it's inspiring to all of us at Mentice and we're very proud to have you here. And he also works with 1 of the U.S.' largest health systems as well. So I'll hand over to Dr. Lopes.

Thank you, everyone. Thank you for the invitation to be here. It's really a pleasure, but I would like to start by saying that the comparison with simulation from the flight industry is actually not fair. I think that, that's actually -- if you look at the complexity of the things we do it's opposed to it's much harder to simulate a case surgery you're about to do than to train into pilot machine that is going to perform the same way all the time. But at the times when you have a complication of flight the simulation, yes, will make a difference on your training. For us, I think the key is specificity and the importance of being prepared for that and how not so much from the physician side, but also the ability to create an environment that reproduces that accurately. This is really difficult to do. So my journey on this was that for 20 years, I was part of a university system and during that journey, I was in Chicago, we were working already with companies that were doing development. This is before Mentice acquired Ankyras. So I had already experienced working with a software company that could actually tell me which device to pick, you have many choices to do a treatment and you have to -- a very important point here, too, is depending on the choice you make, there's a significant cost difference between the devices you're using and the performance difference, too. So I say the cost difference not so much because of how the cost of your treatment, but actually the cost of a waste. If you pick the wrong device, -- and this could be devices that are going from $10,000 to $50,000 a piece, so like this is a huge problem for us if you get a more -- the wrong device selected. This software allows us to have imaging done of the patient and then develop a, a plan. And here, you can see the validation of this process, how you know the length of the device, the size of the device, so you don't pick the wrong sizing and have to lose the device. It's not about the even complication, it's about saving. We have a [indiscernible] website. We actually were using the simulation way before Mentice acquired Ankyras, which is very important. This is how it looks like. I don't want to go in a lot of details, but this is how these devices are fit into the aneurysm area. This is the defect in the artery. So you can see this bubble is the 1 we want to protect and placing the device here has to be done in an exact sizing so that you don't have problems with not covering the aneurysm or also having the ability to have a more successful navigation. So the time of the procedure gets shortened if you pick the device that will fit properly, it goes much smoother. Just to give you an idea of how -- when we -- training -- I'm a neurosurgeon by training. So I training to open neurosurgery, to do a craniotomy, open brain surgery, to do this procedure will take about 2 to 4 hours to get a procedure. Today, with an endovascular approach going through the blood vessels, arm or leg, you can do this procedure less than an hour. So that's the impact of this field. So I think that is extremely important for us to look at this as not only the device simulation, but also imagine that physically, you can do the procedure using the real device into a model. So this is the other company Biomodex that we used to work with them all the time prior to the Mentice acquisition, too. And this is actually when you get the real anatomy of the patient placing a flow model, you actually can do the surgery, deploying the real device here. And this is important in the concept of flight simulator is give you almost like a video game experience of what is to pilot the machine that airplane. Here is you have to deal with other factors. The anatomy is one. So that's why the physical simulation is important, but how the device deployment functions, that is important to do a real deployment of the device that you're about to use. Now a digital simulation is a different type of -- it points out to us, trains us in other aspects of that simulation. So I guess what I'm trying to say is that you need to have a combination of all these different inputs and sources of -- to really simulate the case. And that's what I think, for me, it was really important to see when we got into having in 1 company, Mentice able to provide all the different functions that come together to, actually provide the most real simulation of a case, that is the impact that this had to us. And we were very fortunate to see this early on. So I'll show you a case. This is 1 of the most severe types of brain aneurysms that exist. This artery here controls your balance, controls your ability to wake up and sleep, controls your ability to -- it's the brain stem, it's the connection between your brain, your spinal cord. This artery supplies the blood flow to that. These balloon like structure here, is the aneurysm, but the whole artery is you can see there's a narrowing here. There are a lot of complex issues in there. How do you manage this. This is a patient that comes to you with tremendous difficulties walking and basically, there is about a 30% complication rate to do any procedure to fix these aneurysm, and if you don't do anything, it's a patient that will probably pass from the disease within 6 months to a year from this. So it's a very deadly problem. You have 1 shot to fix this thing. So this is what we're going to talk about is basically the process we went through and what now we do for all my colleagues is to go through the acquisition of the imaging. And then from there, you start doing the planning of this procedure. So I'll show you here some of these steps on this. So the first step for us is to get -- go to the AngioSuite, and we start doing the imaging, which is this spin. You see this is an X-ray, a 3-dimensional imaging. And this data set can easily then be imported from your machine, this is the real case here we're doing the picture, and then you actually import this into the environment. This is in the AngioSuite, and this is another difference that I think over time, what we felt was better was to bring the Mentice System into the clinical workflow. So this is not being done in a separate place. This is actually done while the procedure is happening. So we literally have the system in the room, and now we're going to do the first step of this, which is create a digital model of what that anatomy is. So with that, imagine that the same data set can be used now for a virtual simulation, but also can be used to create a simulation of which device is going to fit better than that, which is the next step. And I'm kind of showing you here, this is a real-time stitching that anatomy into a predesigned body anatomy. So you have these templates that allow us to optimize this and make this much faster. So this is actually very doable in your room today. This exists -- this is happening, okay? And you can see here, all of a sudden, you build a whole blood vessel structure of this patient. But the top part is the real anatomy there. Everything else makes us much faster just to get to that. Now what I think is really crucial is that the same data set allows us then to have also a good idea of what we can import Ankyras and have a data generated of the device that we're going to place. I'm going to move forward here. So imagine, if we're practicing using the digital simulation, and we're doing this with real devices. So right here in the bottom, you can see that there are real devices that we're going to be using, so you're feeling that, and the haptics tells us how this device is going to perform in the case. Now this is Ankyras, which is now telling us using the same data set, you can pick which device on all globally available devices. So this is not FDA approved, only American, you can actually look into everywhere in the world, any physician can see what [ other ] devices are better. You can ask for device exemption to approve that in your country if you find that one device that's not available to you, potentially can have a better result. And you see how beautiful this is. You're literally studying this case in a way that you would not do otherwise if you didn't have these data sets. So this is really important information for us. And it allows us to do the case many times in a digital way as well as in -- actually have real device-specific data. Now I told you that we felt the device in our hands using the digital model, now we decide also which device to use. And here, you can see color map of this allows you to see how the device supports against the wall or the artery. You can -- also, the results of this will depend on how well you can bypass this aneurysm. You're creating an endovascular bypass, you are creating a new artery inside of this patient's head. And to do this, really have one shot to place this bridge over there, and you have to actually connect many bridges. So for you to know how this will fit, you've got to simulate this thing. And so this surgery could not be done like this in the past, and that's why I think the complication rate was so high in this case. And then the last step we do is to actually create a physical model. This is a 3D-printed model. And this is so exciting when we received this on the mail, it is so cool because you really have this -- the model of the patient's anatomy, and you connect that to the different type of flow models we have. This is the process of how this is developed and the 3D print is done. This is the 3D printing process. And then here, you can see us using our machine, and this is our model. And you can see the artificial heart is here. You circulate, you can have the blood flow just like you do. And here is the other component that the [ artificial ] simulation doesn't have is that we have to deal with blood. We have to deal with this causative law, they have to do things that is different than just the device, the anatomy. Now we're dealing with a liquid blood that has been going, and this is what it gives us that idea. So I think that the synergy here is that we're not going to look at only one approach. That was, I think, what created maybe initial resistance for most physicians to use this technology. I think what is brilliant right now is that we are able to get much closer to a real simulation because of the synergy of the different inputs and the different things we're trying to use right now. That is really key to the future of this. I wanted to say to you that part of my journey was that I went from university hospital into a network of hospice, where about now I think the fifth, going to the third, largest health care network in the United States. This is about almost 70 hospices within Carolinas, Illinois and the Wisconsin area. And we have over 18 [ neurointerventionalists ] in my team. To standardize the practice and the ability to do this surgery at this level, imagine that the idea in the past of having everybody coming downtown for the university hospital, it was how we had to manage. We just didn't have the manpower to take care of patients locally. But when you go to a time-sensitive disease, acute stroke for example, you don't have time sometimes to fly someone in -- weather in Chicago is not necessarily the easiest one to deal with to. So many times, we -- the reason for me to go into a health care network was that I saw technologies like what you just saw here with the possibility that we could then standardize the treatment across our hospitals. And so when you look at the deficiency industry -- device industry being the first one to buy into this, and we grow up throughout residency training doing simulations and learning procedures to -- brought by the industry to us. But hospital systems now are going to have to do this as a form to standardized care on all their hospices and all their physicians. So it's almost like when you discuss with your colleagues, "Okay, what is your performance this year? How many cases you've done of brain aneurysm in this location?" Now I can tell to my team basically "I need you to be doing 20 a year of this carotid stenting. I need you to do 50 of these aneurysm in this location." This is very possible to do when you can actually have your own library of challenging cases and then offer to advanced physicians to be able to then perform at that level and be actually a credit to that and be able to continue on their credentialing using this method. So I think that is a huge part of the future where this is going to go. And that's why I think you will see more hospital systems joining this and using this type of technology. Now it's clear to me that we -- to get to this level that we showed to you here, it took us a lot of work to get this together, but this is now packaging. And I think the more integration we see happening is what's going to be this next phase. Our input has been extremely well accepted, and I really have to thank for this collaboration because we really believe the future of this field will depend on us having a seamless connection and integration of all these different modalities to be able to do these cases and become part of our workflow. I think that to finalize, I just want to share with you that 40% of the global population suffers from a neurological condition. And the conditions, stroke and dementia are probably top ones. As we age the population, you're seeing the numbers being very much involved in these 2 diseases. It's interesting that the next phase of -- everything that I learned in residency, I'm not doing today. I had to relearn the whole procedure. I learned open surgeries that I'm not doing anymore. Now I'm doing a lot of endovascular procedures that didn't exist the time I was trained. My birthday was this week, so I don't want to age myself on this, but it's true that it's really sad and amazing and fantastic. I could never predict where we would be today [ in the ] field. And the most amazing thing is that if I had to guess the next 5 to 10 years with brain computer interface and robotics coming to our field and the AI on identification of each device inside of the body, you mentioned that all these thee things, the AI, the robotics and the brain-computer interfaces, we're going to have to train these teams. And everything is new, and we are able to do that using technologies that have this simulation and the ability to attack one of the most, today, disease that affect our population. We've seen a decrease in morbidity and mortality for stroke because of these advancements. So we were [ in part ], in our lifetime, we're able to see that diseases that were killing the population now are not, but we are still having to deal with the diseases that are going to be very problematic as we age in our population. And the only way to change that will be through having lower complication rates, having more automatic standardized procedures either by humans, robotics, is going to be important; and learning from each procedure. And I think the AI integration, that will be key, too. So I hope this is helpful to you. Thank you so much for your attention.

Thank you, Dr. Lopes. We're shortly going to go to a break. But I just want to thank Dr. Lopes and really, the story you mentioned in the beginning about using all of the technologies that we've also acquired over time and then [ messaging ] behind how endovascular procedures have developed and will continue to develop over time. I think it's an honor to be a part of this, and thank you for making the effort of being here.

[indiscernible] one more slide forward. One more. There you go. So that's the patient, let's click on that. So this is a patient that could not walk. And this is now him in our office, and he's going to be showing off a little bit there. [Presentation]

Dr. Lopes, I think that this really highlights about what we've been saying and the passion, I think, you've heard from the other speakers, is that there is a patient at the end of this. And it will affect some -- either ourselves, hopefully not, or someone we know. And I think that's the journey we're a part of. [ It's meant for us ] to help this, to support this. So thank you for the messaging, again. Everyone at home, thank you for joining us, for continuing to joining us. We're going to take a break here now. And then after the break, we're going to have Michael Lee, a Senior Training Education Director from EBR Systems from the medical device industry, who's going to be talking about how they have been launching devices, bring them to market. And he's going to go into details about how the success is or the -- how they've been using Mentice afterwards. Then we'll be having Henrik Storm, the Head of R&D, who will be talking about the technology, the roadmap and what the future looks like. So we're Central European Time here in Stockholm. We'll be reconvening at 3:00 p.m., yes, and hopefully, see you soon. [Break]

Hello, and welcome back to Mentice's Capital Markets Day in Stockholm. So this is the second part of the session. We'll -- we've got Michael Lee online from EBR Systems, a medical device company. Michael is the Director of Global Education for EBR Systems, and he will be taking over from this discussion. Nice to see you, Michael. Thank you for joining us online.

Excellent. Well, yes, thanks for the introduction, and thank you for asking me to speak at this meeting. Firstly, I'd like to say that Mentice has been an excellent business partner to EBR Systems. And I can assure you that they haven't been paying me to say that. It's genuinely a pleasure to be able to speak to the value of the simulator technology, especially given how closely I've worked with it over the last 4 years. So as Martin said, I'm from EBR Systems, and we make the WiSE CRT System, which is the only wireless left ventricular endocardial pacing system in the world. Why does healthcare need the WiSE system? Unfortunately, there is a large global population of patients that suffer from heart failure. Many of those heart-failure patients fail conventional methods of cardiac resynchronization therapy for a number of well-documented reasons, and they have no other options for treatment. Subsequently, their quality of life deteriorates further, and they have a shortened life expectancy. So the WiSE device is designed to overcome the current limitations of conventional CRT, and that's via leadless left ventricular endocardial pacing, as I mentioned. There's a number of benefits to this. It avoids both acute and chronic lead complications. Many experts believe that endocardial pacing is more physiologic compared to epicardial pacing, and it provides the flexibility of endocardial pace in site selection. So essentially, the physician can pace the left ventricle from exactly where they want to. So the nature of our indication, all of our patients have a pre-existing device, as you can see from the image on the screen there, and we call that the [ co-implant ] device, which provides right ventricular pacing. The specific components of our system are an ultrasonic transmitter, and that's connected to a separate power supply in our battery. At the heart of the system is the receiving electrode, and it is approximately the size of a cooked grain of rice, and you'll have to take my word that it is very, very small. So the system is unique, in that we use ultrasound as our energy source to power a passive electrode, which in turn, converts ultrasonic energy into electrical energy and paces the left ventricle. So we do implant the transmitter and battery first. And then we move on to implant in the electrode. And that's the part of the procedure that I'm going to focus on for this presentation as it relates directly to our training and our subsequent partnership with Mentice. So our electrode is mounted onto an 8-French catheter, and it can be delivered -- and it's delivered through a 12-French steerable sheath. The sheath can be introduced, as you can see on the image on the left, by a retrograde aortic or a transseptal approach. Once the delivery system has been positioned at the target site on the endocardial wall for left ventricle, we do a series of electrical tests prior to anchoring the electrode, and that's the image that you can see on the top right there. The electrode is anchored into the endocardium using fluoroscopy and a contrast medium to ensure the proper fixation of the tines before being detached and released. The design of the electrode itself means that it's falling into field within 30 to 45 days. And consequently, the patient only has to take -- is only required to take dual antiplatelet therapy for 3 months. What I am going to do now is to show you a very short video of a recording of a live electrode implant performed by [ Prosoma ] at Bad Oeynhausen in Germany. I'm just going to hit play here. And what you'll see here is a live case, and it was approaching an electrode implant via a retroaortic approach. You can see that the [ delivery ] now in the left ventricle. We move that over to the left ventricular wall to ensure that we have a good seal of our balloon against the wall. What you can see there is the electrode being anchored and a series of evaluations to ensure that the tines of the electrode have actually been fully embedded within the endocardium. It's a very specific part of the procedure where we do that evaluation, and we further advance the electrode if it is required. Again, we take our time to assess in a number of different views to make sure that the electrode is anchored before moving on to touching our electrode and then moving on to releasing the electrode, which leaves the electrode deployed in the endocardium. And then we turn the system on, and that's where the patient starts to get the CRT therapy and hopefully a nice neuro biventricular paced complex. So we -- you can see that there are a few very specific steps that must be followed, and they're quite unique to our procedure, and they're different to most other implant techniques for cardiac devices. As such, as a company, we needed to ensure that our physicians are and were comfortable with both the tools and the best practice techniques to achieve consistent, safe and successful outcomes. And that's where our training program comes in and the evolution of that. So what was the evolution of the training program? And what were the challenges that we faced? Well, as part of our world-class training program, we had been successfully utilizing an animal lab training model. And I do still think there is a place for that, particularly in early stage of device development and in training the user on the correct interaction with a product. However, animal lab training comes with considerable logistical and technique-related challenges, plus there is the ethical consideration of using an animal model. For example, physicians have to take time away from their hospital and therefore, this time is limited. Complex imaging can require third-party vendors, which adds another logistical challenge. And there can be anatomical variations between animal hearts and humans, which can complicate already-complex training techniques and implant approaches. So when we looked at that, we considered whether our current training model was scalable for commercialization as we looked towards that. And we considered that it probably wasn't. So that was thinking, obviously, as a training department and as a company. And we came up with a list of user needs. So we knew that we required a simulator technology to address those limitations I just mentioned. We knew that we would need a custom-designed software because our implant technique is unique. We knew that we'd also need retrofitted hardware because we wanted to use our products with whatever simulator technology that we were going to use. We also knew that we wanted it to be transportable because, again, that was a key component of it being scalable. We knew that we also wanted customer support globally, particularly in Europe and the U.S. But the key point for us is that it had to be realistic. We didn't want to compromise on where we currently work with our physician training program. So we had heard of Mentice as a world leader in software and hardware simulation solutions for endovascular therapies. And it seemed the right place for us to start. So at the end of 2020, I reached out to Erica Adams, who is one of the Mentice sales directors in the U.S., and that was part of EBR's Phase I scoping based on our updated training needs. Kind of long story short, after a very effective and pleasing project execution with the team in Sweden I can't speak highly enough of, there were multiple ways of prototype testing and updates. And the final product certainly met our very-high expectations. We didn't kind of just accept that it would be acceptable to replace our animal lab training as it was. So we did conduct our own validation testing before moving away from the animal model. And the survey that we had from experience and inexperienced [indiscernible] with 100% of all physician surveyed said that the EIS, we call our electrode implant simulator, was an acceptable tool to include in our physician training. Subsequently, we have purchased 7 systems, placed globally, and all of those systems are covered by ongoing service agreements by the excellent customer team both in Sweden and in the U.S. Further to this, in November 2022, we commenced our Phase II EIS upgrade project. And what that sought to address was both the evolution of our implant technique over the last couple of years, from 2020 and the development of a physical transeptal handle and to update our best practice steps with new procedural warnings that are embedded into the training platform. Again, this was efficiently managed by the team, and the final product absolutely filled the brief, and we've been using it very successfully since. So the tool, as I mentioned, that we call the electrode implant simulator or EIS, as you might hear me refer to as we move through; so that's now embedded as part of our physician training for both new and experienced positions in the form of refresher training, as we term it. The EIS was developed with input from experienced WiSE implanters. So there was already a buy-in from our experienced users there. And the training session that we now offer has both a wet table component, where the physicians use our actual demo products, and also the dry table simulation, which is the simulator itself. And this allows the physician to walk through our best practice training steps for both retroaortic and transseptal approaches. And the features of the system [ are many ], so they include 2 modes of ultrasound imaging, so transesophageal echo and intracardiac echo imaging which are used per procedure like, and fluoro controls, the physician can move the controls for the fluoro-based system. Further to that, we have our custom-designed WiSE products that interact and go within the G7 unit. The system also allows us to perform septal implants. So basically, we can implant an electrode anywhere within the left ventricle in the simulation. And this is actually -- it's a part of cardiology which is quite exciting, and it's a growing area of device implantation, known as conduction system pacing. So we've kind of future-proofed our training platform without actually planning on doing so. So that was quite advantageous. So [ Paul ], I just kind of want to focus on -- just for a second, is the procedural rehearsal and how key simulation is and has been for us. So procedural rehearsal is certainly a key success factor to our clinical outcomes. And I'd say that's both true internally for our field team [ proctors ] and also externally for physicians performing the implant. We do prioritize clinical excellence at EBR Systems, and so we really needed a training tool that could deliver that where we needed to. Now initial implant training is critical, as I've mentioned previously. But what we have established to our journey with implanting the WiSE system is how equally important, what we call, our refresher training is in achieving those consistent, desirable outcomes. And that's really where the EIS has been revolutionary for us. So rather than bringing the physicians to the training, we wanted to bring training to the physician. And the reasons for that are probably obvious, based on kind of what I've already mentioned. But the logistical challenges are kind of one of the main reasons, and we get to -- we don't have to take the physicians out of the hospital, where their time is constrained. So therefore, it saves time for them. It also saves time for us taking the system to them. It saves costs, and it allows them to work in the comfort of familiar surroundings. So we can set the system up in an office or in a boardroom, where a physician is comfortable and they can learn in a nice kind of low-pressure environment. What we also did as a company because we recognize the importance of this refreshed training, is we mandated as a company ahead of every single electrode implant, our reps would bring the simulator to a site or hospital, and the physician would then spend 30 to 60 minutes performing implants with the team before performing a live implant. That repetition, which is ultimately key, ensure that any mistakes or deviations during best practices were picked up and corrected outside of the lab environment. The physician could prepare for a real-world situations that might happen in their case and do that kind of pre-case planning. Another thing that it also allowed is it allowed the rep [ proctor ] to develop a relationship with the physician outside of the pressure of the [ lab ], so a lot of benefits to using the simulator. What I'd like to just show you now is the electrode implant technique, again, showing you a simulated implant on the electrode implant simulator system. And what this is, this is a clip that we put together. And you can see it's the same retroaortic approach. We approach the wall with the balloon. We can use the same technique. We can assess the seal with the bloom before we move on to the anchoring process. We are now assessing for the tenting of the endocardium with electrode. We advance by 1 millimeter increments, as you saw in the previous video. And now we get to look to see whether there is any residual tenting of the endocardium on the electrode before deeming the electrode is fully anchored again, as in a real-life situation. Once we've confirmed the electrode is anchored in a second fluoroscopic view, we can then move on to the touch and leaving the electrode deployed in the endocardium, just as you saw in that real-life case a little bit earlier. So a little bit of fun. Obviously, [ spotless ] difference when it comes to the realism of the system. So what you can see on the image on the left is a live case of a deployed electrode. And on the right, you can see the simulation from the system. And I think you can agree that they're pretty close with how they look. And that was a huge part of why we have continued to develop our relationship with Mentice. Another point I'd just like to kind of highlight on the benefits of the simulator is the echo training platform. And really, in my opinion, and a number of my colleagues, it really is kind of best-in-class for teaching periprocedural echo techniques. So what you can see here on the screen, this is actually a slide taken from our training materials, where we have focused on the periprocedural imaging. In the middle of the screen, you can see the intracardiac echo ultrasound image that you get during the case on the simulator. And then the 2 images on the either side to the left and the right of that image, are those training features that can show the position of the products within the heart, but also delineate the various chambers that the devices are in. As I mentioned, it really is best-in-class for teaching the use of both intracardiac echo and transesophageal echo. And there's also a number of preset features that can be used during an [ implementation ] with a physician. So the proctor doesn't have to be an expert on echo to get the required views for the [indiscernible] to complete the simulation. So a huge part, again, of our -- of how we utilize the echo platform and the tool for our internal training. So nearly under the conclusion, so the simulator really has been a critical success factor for EBR and WiSE implantation. So the electrode implant simulator provides the right level of feedback and information to reinforce and train implanters on best practices, situational troubleshooting and avoiding potential adverse events. It enables repeated reproducible implant techniques, which helps provide additional comfort with the WiSE CRT system components and electric implant requirements. And that, in turn, reduces the risk of avoidable complications and maximizes procedural success. And here's kind of a statement that the Mentice simulator was a critical success factor in EBR meeting the endpoints in our pivotal IDE study required for FDA approval. So what we presented, our late-breaking clinical trial and our pivotal study, [ HRS ], in 2023. And what those results showed is the leadless left ventricular ultrasound-based endocardial pacing with WiSE was feasible, safe and clinically beneficial to our heart-failure study population. So that was a huge milestone. And the simulator was absolutely part of that journey and enabling us to get such positive outcomes from that pivotal study. Just finally for me because I couldn't leave without adding kind of an additional layer of benefits of the system, I focused heavily on why we've used it for -- from physician training and achieving safe and successful outcomes, but there's much more to the system than just that. So there is the field team training via -- as a virtual training platform. And what I mean by that is that anywhere that we have one of these systems, they can be set up in the counter of a rep's home or in an office. And what that allows us to do is a series of virtual field team trainings via Zoom or Teams. So we can plan and we can conduct training with groups or individuals anywhere globally, as long as they have at one of the EISs. What that allows us to do is it allows us to put an expert trainer in the room with those individuals to ensure that they are getting the correct advice and the correct training. So for example, this morning, I conducted implant training with two of my colleagues based in Australia, and it was a very positive training experience. And lastly, so the use as a pseudo marketing tool [ conference ] and events can't be understated in my opinion. The simulator, as you can see from the image there, it's fun. It's interesting. It's a nice thing to have on the booth. It certainly brings in thoughtful to interested parties on both our technology and the simulator. I think again, just another example for you is I recently attended the [ IRA ] advanced device course that was held in France. They had a number of simulators that were supporting a number of trainee doctors. And mainly kind of the enthusiasm for those junior doctors to see the simulators and get hands on to implant the technology, again, cannot be understated. And I really think it's an effective tool from that perspective as well. So thank you for permitting me to chat to you about our use with the simulator, and I hope you found that informative.

Thank you, Michael. It was very informative. You touched on so many different areas that we've been talking about for the last 4 or 5 years, about the senior physicians, about adoption, mission rehearsal, about using simulation to support the physicians when maybe they aren't doing so many cases. So you touched on the sales aspect supporting internal training, remote proctoring, it was a fantastic success story. And of course, for the local teams based around the world as well, the impact to support you. I believe you'll be joining us for the Q&A afterwards. So I'd like to thank you again for the presentation and look forward to you being a part of the Q&A afterwards.

Great Thanks, Martin.

Thanks, Michael. So the next one, we'll hand over to Henrik Storm. We saw that advanced technology for pacemakers that Michael showed us, and Henrik will be showing us how it's done.

Yes. Thank you, Martin. Hello. I'm Henrik. I am the Chief Technology Officer at Mentice, I've been in this role for 10 years. Before I came to Mentice I worked with fingerprint sensors and mobile phones at Fingerprint Cards. So I'm going to talk about our technology today. I'm going to talk about the challenges we need to solve and how we have addressed them. So it's -- I guess you already know or understand that it is a really, really difficult problem that we are solving. And we're going to take a look at how we have done it here. We have put in -- the problem we need to solve here is to model what happens inside a human body during a complex medical procedure. That's really the main issue. And there's been a lot of hours, a lot of years going into this. We have over 20 years of continuous development. The development team is right now about 45 people worldwide, working both on software and hardware. So let's take a look at what problems we're really solving with our products here. We're not really simulating a single procedure. We're simulating a family of procedures. So we have or close to 50 different procedures that we are able to emulate. We heard a couple of times already today that every patient is unique, every simulated case is therefore very difficult to build. It's like the doctor needs to fly a new type of plane every day. Every new patient is unique. We need to replicate how the medical devices look and how they behave when they are inserted into the body. We talk about catheters, guidewires, but even also more complex devices like heart valves and pacemakers and things like that. And not at least, we need to be able to speak the language of the physicians. We need to be experts in a lot of different fields. We have project managers that dig very deeply into different specialty areas to understand how things are supposed to be done. A little bit of a repetition. You have seen this earlier. Looking at our products, we have three main technology areas, the Virtual SIM or the VIST, circle is our classical hardware and software, the virtual simulation system. That's where we can today simulate close to 50 different types of procedures. We also have the physical simulation, the ability to create blood vessels in tissue like material, and put them in a flow system to give another aspect of the realism. And to that, we can add our software solutions like planning solutions and cloud solutions, et cetera. These together, I think we are unique in the sense that we have all these three areas and how they interact is something that we can make use of. Let's look at how we're solving this problem. We need to replicate reality in some way. So I'm going to go through five dimensions of realism that we need to address in our system. First, these five dimensions will focus on -- mostly on the virtual system, the physical and the software connects to some of them, we'll get to them later. You've heard about image-guided therapies. Image is a key word. We need to be able to replicate the images. We have x-ray, the standard modality in some modules. We also need to have ultrasound emulation. The way we do this is not by replaying a prerecorded video. We are generating or rendering this material from scratch like an animation or a video game basically. To the left here, you can see another example of the real world versus the emulated world. The left picture is from a procedure done on -- this is a heart value repair procedure pretty complex, takes several hours to go through. And that picture is from the day the physician team trained on the simulator. And the second image is the day after when they actually performed it on a real procedure, saving much time in the procedure. But as you can see, they are pretty similar. A second level of realism that is very important is the anatomy. We need to have a model of the patient in 3D to be able to build our simulation. So we import. As you saw on some earlier slides, we can import anatomist from CT scans. We also have a library of hundreds of anatomies in our system that we can reuse. They need to be -- they are focusing, obviously, on the blood vessels and the heart, but because that's where the instruments are traveling. But other parts also need to be -- the skeleton, the organs and the full body needs to be there to be able to create this realistic experience. And third dimension here it becomes really difficult. This is the instrument and device realism. The devices we use must look good in our image and must look correct, and they must behave correct. That's what really makes it difficult. In this particular case, you have an artificial heart valve that is implanted in the anatomy of the heart. We not only need to simulate the end result. We need to create a video of how it behaves in real time when that artificial valve grabs onto the threads in the heart valve while being deployed. And the algorithm we use to describe this interaction between instrument and anatomy, is what we call the physics engine, and that is really the brain of our system. That's where we -- most of our invested time has landed. It's really the core of the system. It governs how all kinds of instruments interact with the model of the patient. But it not -- it doesn't -- it's not enough with it looking good. It needs to feel right, too. So we have this haptics unit that is not only measuring how the physician is using the instrument, there are sensors inside, they'll track rotation and translation of the instruments, but it can also apply a friction force to them. So you feel what you're doing, if you're doing the right thing or not. That's the fourth dimension of realism. And we will end with the fifth one, which I call the procedural realism. This is the knowledge that we need to have on the procedure. We need to be able to have an intelligent discussion with Dr. Lopes . We need to be able to talk to Michael at EBR about their specialty and understand -- fully understand their procedure and how it works to be able to build a simulation. All that combined, this is what we have to solve with our products. We take a little bit look at the second circle, and that is the physical simulation. We have an ability to manufacture blood vessels with three different methods. Two of them involved silicone. We can mold silicone and we can decode silicone. We can create large aortas and we can create smaller vessels in the brain. But we also have a third method and that is by using an advanced 3D printer with multi-material functionality. That means that we can add even another layer of realism to our vessels by making it softer or harder in different parts of the vessels. We can vary the stiffness in the vessels to replicate if a vessel is close to bone, maybe shouldn't move as much or if it's more in the most center of the patient, it's more flexible. So we can allow that degree of realism with our system. And then you can use sort of vessels, as you can see in the lower right individually, but just testing part of it, and maybe you want to try our stent clot retriever in that part of the anatomy or we can mount it in a complete flow system where we pump fluid through the system, connected to a bigger anatomy and allowing more complete training environment. These systems, I should say, probably delivers the very best haptic feeling. I don't think we need to talk too much about this. Dr. Lopes has already showed the use of the Ankyras tool. This is the first tool, the first planning tool that we have. This is the tool, a cloud-based tool that we can use to -- a physician can use to import a specific -- part of the anatomy of a specific patient evaluate different sizes, different brands of flow diverters, the device here is the flow diverter. And see how it fits. So you're more confident when you go to the real procedure day after. This is the project that was recently CE marked. It is a cloud solution. It runs on the phone or the laptop. And it's been validated in studies, 93%, 94% accuracy in its porosity and the length of the device. So I'm going to talk a little bit here about -- I'm going to show you a little bit about how the virtual simulation works. So we don't only build software in the virtual simulation actually has the physical component, too. And this is the device that you use to insert the heart valve that we looked at the earlier slides. The heart valve it's a pretty big device. This is the device that we will need to simulate. And if I click, you can see that the -- when the instrument has reached the heart, you verify the position that it is correct by using the ultrasound views on the right. And then you start rotating the different wheels on this control. And then the device appears it's compressed sitting at the top of the catheter. And finally, it will pop out, there it comes. That is -- what I mean with behavior. How does that -- how do you build that in a realistic way. We need to know not only how it looks but also how it behaves. And there's another one. The right video will show an implant of a pacemaker it's similar to -- it's not the same device as from EBR that we have looked at. This is a leadless pacemaker. It is a final little thing. It was sitting outside here. If you happen to see, it's just -- in the break. It is a device that is implanted inside the heart. It has a few hooks, so you need to make it grab the insight of the heart and then leave it there. And then it stays in there for 10 years. So this is the simulation of that one. We're navigated into the heart and now it's -- we are deploying it. You saw the hooks grab onto the tissue of the heart, and there is -- it's gone. Now it's attached like this to the inside of the heart. And it'll sit there for 10 years. It has a battery and some electronics and it'll give electric pulses to the heart. Then there is actually a tool to remove it also when you need to replace the battery in 10 years. Okay. I'm going to end with an attempt to predict the future. If you look at what we have done the -- last years and what I think we will do. I think the technology that we are developing, the whole market is moving to making things more and more automatic. If you compare this to the self-driving car, we have the GPS systems. We have the cruise controls. Some of you probably have cars that can steer themselves a little bit. In the end, it will be a self-driving car. We think it will be a similar development here with the physician getting more and more support. On the left-hand side, the fixed cases. Those are the regular training cases that we've been building for 20 years. You saw in some of the earlier presentations, the ability to import custom vessel to build new cases, new specific cases. Stage 1 and 2 is about importing new procedure of the patient or specific procedure of the custom patient. And that's where we have been spending a lot of time in the last years. We are right now in Stage 2, 3, 4 automating this and the Ankyras, the flow, the brain flow diverter planning tool is our first product in the Stage 4, the decision support planning tool. But there are a lot of more applications in that space. We want to help the doctors more and more, helping this treatment to become more automatic. And with that, I will say thank you.

Thanks, Henrik. So I hope you have found this afternoon and the presentation helpful to understand what we do. So I will just try to summarize what I believe we have talked about. So what we -- intention of the day is to demonstrate for you our business model, a proven business model, the fact that we are a market leader in a fast-growing market. The requirements for -- thank you. The requirements for our techniques is very clear. You heard Michael Lee and Dr. Lopes talk about a lot how they are using our technology. I think that's extremely interesting and relevant. We see we are moving to economy of scale. We talked about this for many years that we need to get to critical mass and economy scales. We are getting there. I think it's also important to -- when we say that we believe we can fund our own journey. So in terms of the capital needed for our operational growth that will be generated by our own business. I think that's very, very important. We have a clear strategy for the future. We are investing in the long-term growth of the company. It's not just a short time win that we're looking at here. So what Henrik just talked about, our ambition to really build the next-generation technology and really see the long-term requirements for what we do and the ability for us to continue to grow. A fantastic team of employees and colleagues but also working with our clients and partners like Dr. Lopes or Michael Lee or others, a fantastic passion and really a desire to take this to the next level. Our technology is core to what we do. I mean what we have done so far, how we have been able to combine these different technologies into a completely unique set of solutions. And with the team that Henrik and Jonatan manage, I mean, world-class engineers, we are absolutely confident that we can bring this even to the next level. And I think one of the things that I stressed in the beginning also very, very important and something we've built over 20 years or more, the client network and the interaction with the main key opinion leaders in the industry. It takes a long time to build up this relationship with these large companies. We are working with, if not all, a large majority of them. So this is really what we wanted you to get a feeling for this afternoon, and we want you to bring with you when you leave this meeting. So we have a disclaimer, forward-looking information. I'm not going to read that, but it's in the presentation. And with that, we will hand over to the Q&A. Mr. Binder will manage our Q&A. Thanks, Christian.

Thank you so much for all these great presentations. Now we're going to proceed to the Q&A. So I would like all the panelists to come on stage. So Dr. Lopes, I think I have one question for you to start with. In theory, when you hear all the stuff about simulation, if you're kind of an outsider, you think, all right, everybody should do this right now, so to speak. Obviously, there can be some practical hurdles. So what do you think are the biggest practical hurdles? And how and when will they be overcome?

Well, it's a great question. I think that -- I think Mentice was ahead of its time for many years. I think now we are getting to a point that these hurdles are becoming less and less, and the benefits are much more clear. So I think this is already a reality now. And the only thing I would say is with the health care systems, how image is being processed, you're going to see even easier way how this information will get to us and we'll be able to then to apply this technology that was way ahead of its time when it started. But I think that you're getting to the sweet spot right now and it's going to be less and less of a barrier to entry in this.

Perfect. Anything to add?

I mean I think that -- I mean, what Dr. Lopes is very important, and we see a lot of announcement on the imaging technology. But also, as you say, I mean, more and more physicians really endorse and want to use this, and it's not only a training tool today, it is what you talked about. I think your presentation was really, really clear. This is the daily clinical practice. It's not just initial training. And I think what you said that what you learned when you were fellow resident, it's not relevant anymore. You need to constantly be on your toes and learn the new technologies, especially in this field where so much thing is happening so fast. So...

Yes. And I do see this in a global sense, a very easy entry level. Like the -- if you think about the cost of an investment having these type of platforms versus, having to learn case after case or not having the experience, I think it does make a huge difference to be able to have -- when you're -- we have the knowledge now to treat the disease that we couldn't treat before. Stroke is a great example of that. We have had a huge impact on that and is clearly now to go globally to treat this everywhere in the world will depend on technologies like this to be able to keep those physicians trained with the beginning of those programs.

Got it. Now I have a question for Michael to start with. From an industry perspective, I think what two opposing perspectives that I often hear from investors is that the companies which are leading, for example, in VR simulation today already have a large edge and it's just going to get larger over time. On the other hand, some people are arguing that one simulation is going to become big, at least the larger medtech companies will work on developing their own simulation. What's kind of your perspective? Do you think it's, worth it, and likely that some players will start developing their own simulation?

Again, I think it's another great question. I think the answer is kind of -- it depends if Mentice can continue to develop the technology like they have been doing, because for us and the other kind of big blue-chip companies. If they can come to Mentice with a unique device or proposition and with -- in most respects a complex set of user needs, and Mentice can quickly understand them, assimilate the kind of -- what the project looks like and deliver as they have been able to do with those [indiscernible] a relatively efficient time line. I would say that for the company, it's the need for them to develop their own simulated technology. I don't know how important that actually is. And so it's for kind of Mentice to continue to offer the service that they have with us to kind of lead the way on that. And just kind of to support the previous comment from Dr. Lopes as well. But you have expert physicians like Dr. Lopes, and they have multiple different devices. They are choosing to implant in a range of different patients. and they're experts in what they do. But they may not implant the device for a number of weeks or maybe even months. And I think that's where this simulation technology just comes into daily practice, as you said. But it's that kind of a refresher tool, to kind of muscle memory to get back into using that set device. I think it just the technology complements the expert nature of these physicians to be able to implant all of these different devices. But as an industry, we have to support them with that and simulators fit into that package.

Got it. Perfect. Jonatan, anything to add there?

I think, I mean we -- by using our solutions, we allow the medtech companies to focus on what they are really good at. So I hope that our investments in technology in staying in the forefront in this will both provide value for the medtech or for the medical device industry while keeping us -- having a continued growth in our business.

Perfect. We also got viewer question regarding the new financial targets. The question was basically about, you mentioned that you've done a number of acquisitions historically. What's approximately been the organic growth over time? And then in your new financial targets, is that all organic? Or do you, so to speak, calculates that some acquisitions will be made?

No, that's all organic in the plan we have today. And we're obviously including what we have acquired up to now, but for going forward it's based on our current portfolio of products and business.

Got it. Do we have any questions from the audience here? Yes.

Yes. Rikard Engberg, Carnegie. So my first question is, can you elaborate a bit about the revenue per employee, which has seen a great development during the year. Will this development continue in order for you to reach your new financial targets? Or is this so to say, a new plateau revenue per employee?

You want to try...

I think we are going to continue to see an increase in revenue per employee, partly because as Jonatan explained the focus on increasing the software sales. And as Jonatan also explained about the work that we're doing with the OEM channels. So we are assuming that's going to increase.

And my second question is regarding to the sales of cath labs. Do you see the current installed base as you -- your biggest source for new sales to cath lab or is it newly installed cath labs?

It's a combination of that, obviously. I mean, it's logical for us to combine our technology with the sales of cath lab or any suites from these companies Siemens and Philips and so forth. Then we're talking about new or replacement cath labs. That's a clear business idea to work with these companies doing that. But absolutely, and we can see with Dr. Lopes. I mean he has got the simulator integrated in your current cath lab and a lot of physicians and hospitals have that interest to actually have a simulator in their cath lab. And they will probably then in most cases, work directly with Mentice to buy the system and to integrate it in the current environment. So it would be a mix definitely.

I think on that note to interventional platforms, it's a new trend in the hospital, when you're building a hospital used to be the operating rooms for open surgery, conventional surgery would be very prime space. And now you actually have floors being dedicated to interventional platforms. They have these cath labs for cardiology, interventional rheology, neurosurgery all in the same platform. So there is a trend of increasing number of labs not only rebuilt or populate the ones that already exist, but also get new labs because the surgical procedures are going towards endovascular surgery more in every area. So I think that is going to be -- the other area that's growing tremendously is oncology, delivery of cancer treatments through cath lab which is a tremendous area of growth. So I think Siemens, Philips, Toshiba, they're all seeing the growth on their sales of labs.

So when we talk about the 4,000 or so cath labs sold every year. That's obviously a mix of a completely new one and also replacement one. So I think still is probably a large part of that is replacement or upgrades, but there's a lot of new -- completely new labs as well.

Yes. Yes.

Great. Another thing that I would like to discuss a little bit more in regard to your expansion, so to speak, from simulation to performance solutions. It's a huge market, but obviously, it consists of a lot of different small niches, so to speak. When you look at potential niches to enter. How do you determine which ones are most attractive? And then do you think it's possible to enter them organically? Or do you think because they usually dominated by some company or a couple of companies, it's pretty much for M&A that you will enter?

I might ask Henrik to help me. But no, but we -- I mean if we look at Ankyras, the Ankyras technology, is now implemented for the brain, but the technology could be used for other parts of the body. So that's one technology where we can leverage that for kind of peripheral aneurysm and other parts of the body. How do we target certain areas? I mean, we internally talk about following the money, which is sort of a cheeky way of saying it, maybe. But we're looking at where do we see growth, where do we see opportunity, where do we see value generated for the care provider, where we see value generated by the medical device company -- or for medical vice company, but obviously for the patient. So if you follow that, you can look at structural heart, it's clearly one area where it's a massive upside opportunity. I mean every valve in the heart is a $10 billion, $12 billion, $14 billion opportunity, which is now maybe less than $1 billion. So there's a massive growth, but it's also other parts of the body. You talked about cancer treatment, oncology, enormous growth area for treating direct in the endovascular treating cancer, in the liver around other parts of the [indiscernible]. So I think we can -- a lot of the technology we have could be repurposed. And I mean that's what we talked about is a barrier to entry. It's hard to copy what we have done. So sort of a long answer, but it's really a mix of organic, but clearly, we are looking at additional acquisitions in specific area. There's a lot of investment done in some of the specific areas where -- like with Ankyras, they spent more than 10 years developing that product before they made it commercially available. So I think for us, that's probably a much faster path in a specific area like that to look at an acquisition rather than developing yourself. So we're looking at all of that and looking where do we have a good platform in our current physics and technology, can we go faster on our own rather than acquiring. So we're always looking at that, obviously.

Perfect. Jonatan, anything to add?

No, I think it's -- as you say, it will be a mix. It will be -- I mean, when it makes sense and when we can apply what our knowledge different area. That's one thing. But certainly, in some cases, if we want to move in there, it's a better path to do acquisition.

Perfect. Any further questions from the audience? Otherwise, I think one interesting thing around endovascular simulation right now is that you already only had a few competitors to begin with. Now recently, one of the competitors, CAE sold their healthcare division. How do you think competitive dynamics will change?

It's an interesting question. I need to think about that answer. I mean we're really looking at this as a, call it, a blue ocean market. We're really creating the market. So I mean, we can still look at potential to take market share. And certainly, we're going to see more new players coming into this market. But I think for us, it's more focused on really expanding the market go vertical, as we talked about, to really open for new opportunities. So I think that's sort of our focus. We're not that concerned about competitors actually. Then again, I mean, we compete with different kind of companies now. I mean, it's not only competing head-to-head with a specific technology. We're also competing for funds. So I mean, there are situations where device companies like EBR or maybe not EBR, but other company would look at VR helmet solution or augmented reality solution or an online more of a gaming solution that could compete for same funds. So I think we see that more and more less, so the head-to-head direct competitor. I mean, I think it's several years since we had a direct competition on a new opportunity in the medical device side, but we compete for funds. So that's more the fact actually.

Perfect. Got it. I think that was unfortunately all the time that we had for the Q&A, but I want to once again thank all the speakers. Thank you for all of you who attended live, and thank you for all of you who watched online, and I hope you have a great rest of your day.