Onward Medical N.V. (ONWD) Earnings Call Transcript & Summary

Welcome to ONWARD's 2024 Full Year Results Webinar. I'm Anna Gigante, Strategic Project Lead at ONWARD. A reminder that today's event will contain forward-looking statements which often differ from actual results. Any forward-looking statements communicated today reflect the company's current views and are subject to risks and uncertainties. Our CEO Dave Marver will lead today's call. I will now hand over to Dave.

Thank you, Ann. Just confirming, could you hear Ann? She was some distance from the microphone. Yes?

Just a little.

All right. Amori, could you hear her?

Quietly. But, yes, it was a bit soft.

She just went through the forward-looking statement slide, said that what we present today may differ from what actually happens, sort of standard stuff. You can refer back to the slide if you have any questions about it. And then she introduced me. So, it's a pleasure for me to be here with you. I am joined, as usual, by Amori Fraser, our Senior Finance Director. And we have 2 special guests today from NextSteps Chicago, one of the first clinics in the world to purchase and now be using our ARC-EX system that was approved by the FDA in December of 2024. So, we have Mary Jones, who's a thought-leading physical therapist and one of her clients, Dan Spencer. And so, after my remarks, the business stuff, they're going to share their early experience with the ARC-EX system with you, and they'll also be available to answer questions that you may have when we enter the Q&A session. So, with that, let me get started. As usual, some of you are new to the company, new to the story. So, I just have a few slides to serve as introduction to tell you a bit about the company. So, we were founded about 10 years ago. We have 100 people or so. We're headquartered in the Netherlands. We have a Science and Engineering Center in Switzerland, and we have a growing field sales and service organization based in the United States. We are a listed company. We're listed on 3 exchanges, Euronext Brussels, Amsterdam and Paris, and we enjoy research coverage from 5 banks currently, all of whom maintain a buy rating. As a company, we have 3 neuromodulation platforms, all of which stimulate the spinal cord to restore movement and other critical functions after spinal cord injury. We're a very innovative company. In fact, we have 10 FDA breakthrough device designation awards and over 150 issued patents. That's a lower number than you're used to hearing from me because we have taken out the country validations. With country validations, we now are approaching 300. We have also exhibited a lot of clinical traction. So, we've already established the safety and effectiveness of ARC therapy using the ARC-EX system for hand strength and sensation that was highlighted in our Up-LIFT pivotal study that was published in Nature Medicine last year. We've also published positive interim results for ARC-IM therapy. We're launching into a large total available market and limited competition. And indeed, we're here to talk about the fact that we finally have a commercial product out there helping people. The ARC-EX system received FDA De Novo classification and U.S. market authorization in December. We're in the middle of a limited launch, which we concluded really in the first quarter. And now that we're in the second quarter, we're expanding the launch, and we are increasing production and field presence and everything else. So more to come on that. Our vision is that empowered by independence, people with spinal cord injury will enjoy life in the ways that matter to them. And we are pursuing that vision with these 3 technology platforms that I briefly referenced a few moments ago. First is the ARC-EX system. This is an external stimulator. The first approved indication is hand strength and sensation after spinal cord injury. The results were published in Nature Medicine last year, and we're currently exploring additional indications via investigator-initiated research projects in both spinal cord injury and stroke. We also have an implanted device called ARC-IM. Here, the first indication we're pursuing is blood pressure instability after SCI. We are expecting IDE approval from FDA, so we can start that global pivotal study sometime in the first half of this year. And in the meantime, we're using this technology to conduct clinical feasibility studies for mobility and blood pressure in SCI and Parkinson's disease, and we expect to start a study using the ARC-IM system to address urinary incontinence this year after spinal cord injury, which is a big issue. We've been pairing the ARC-IM system with an implanted brain computer interface. We call that platform, our ARC-BCI platform. We're looking at both upper limb and lower limb movement, and we have clinical feasibility studies ongoing. And later, we could look at whether this has any application in Parkinson's disease and stroke. So, a lot going on here using the 3 technology platforms that we have developed or are developing and each in a different stage. One is approved in commercial. The other is in clinical feasibility studies, soon to start Phase III or pivotal studies and then ARC-BCI is in clinical feasibility study stage. Okay. So, I'll take a breath because last year, we got a lot done. You can see there were 20 major achievements that we announced, and I am going to walk through those. The ones that are highlighted in light shading, we'll go into more detail. They'll each have their own slide. So, starting in Q1, we announced expansion of our ARC-IM clinical feasibility study for blood pressure instability to the Netherlands. So that's now a multisite study that helps us learn as we prepare for Empower BP, which is a multicenter study and a global study. Again, we hope to start that later this year. We were also awarded our 10th FDA breakthrough device designation award, this one for our ARC-BCI, Brain-Computer Interface platform. KBC Securities initiated research coverage with a buy rating in February, and we raised EUR 20 million back in March. In second quarter of last year, we submitted our De Novo application to the FDA for the ARC-EX System. Stifel, which is a global investment bank based in the U.S., also initiated research coverage also with a buy rating. We obtained debt financing of up to EUR 52.5 million from Runway Growth Capital, which is a U.S.-based growth lender, and we published the Up-LIFT pivotal study results in the prestigious journal, Nature Medicine in May. In Q3, we announced a publication in the Journal of Neuromodulation, highlighting evidence-based programming for RTX therapy. So, this gives clinicians like Mary, who you'll hear from, an initial set of programming parameters to get people started on the therapy. We announced the publication of our annual sustainability summary for the full year 2023, and we expanded our listing coverage from Brussels and Amsterdam to Harris. We were also awarded a grant to further study our BCI system, ARC-BCI, for upper limb function from the Christopher & Dana Reeve Foundation, and we announced our third implant of ARC-BCI to restore movement after spinal cord injury. And then Q4 was even busier. We secured rights to the WIMAGINE BCI platform from the French Atomic Energy Agency. We raised EUR 50 million additional capital, including a strategic investment from Ottobock, which is the world's leading manufacturer of advanced prosthetic limbs. We welcomed a new Board Chair, Rob 10 Hoedt. He was the retired President of Medtronic International, a long-time Executive Committee member of Medtronic and also a long-time Chairman of MedTech Europe, the MedTech Industry Association in Europe. The ARC-EX System was named one of Time Magazine's Best Inventions of 2024. That's nice recognition. We were awarded a European Innovation Council grant to further study ARC-BCI therapy to address upper limb movement after stroke. We were ranked in the top 15% globally for our sustainability efforts. And then the exclamation point, we received FDA authorization to begin marketing the ARC-EX System in the United States. So, more detail. So, these are the results that we published in Nature Medicine from the Up-LIFT pivotal study for ARC-EX therapy. We met all primary and secondary endpoints. And here are some of the highlights, let's say, on the left. So, 90% of participants, 9 out of 10, improved strength or function. 87% reported improvements in quality of life. Notably, we observed improvements up to 34 years after an injury. Today, if you're injured or at least prior to our device being approved, if you're injured, you have emergency surgery, you're normally in rehabilitation for 3 months, and you're sent home. And you're told really nothing else can be done to help you recover function. Here, we saw responders 34 years after an injury. On the right side, you see some qualitative or other comments here. No serious device-related adverse events. Participants also reported reduced spasm, improved sleep and improved upper body sensation, including the sense of touch. And the progress was meaningful. They regained enough function to lift filled cups, push a button on a remote control, pick up an object with a fork. So, introducing independence or enabling independence in activities of daily life. Also, very important for us strategically, we brought in-house. We now have exclusive rights to develop and commercialize the WIMAGINE Brain-Computer Interface technology. We in-licensed this from a leading research institution funded by the French government. This enables us to be first to market with a BCI-enabled system to restore movement after paralysis. It gives us full control now. We have our spinal cord stimulation system, ARC-IM and now the VCI, so we can develop an integrated system under our quality system that's the best fit for our therapies. And we now have the ability to advance this technology with existing pending and potential grant funding. So, this was, for us, again, very important strategically. The Head of the Neurotechnology Biomedical Research Institute at CEA, which is that institute from whom we licensed the technology, [ Guillaume Chuard ], he said the early clinical feasibility -- it's covered up by my Zoom. So, I don't know what it says -- demonstrates the remarkable potential of the ARC-BCI system to restore thought-driven movement and function after paralysis. We are pleased to partner with ONWARD Medical. In addition, I mentioned in our October financing we brought aboard a strategic cornerstone, a strategic investor, Ottobock. This is a global leader in the fields of prosthetic orthotics and exoskeleton technology, bigger than you might think. Many of you perhaps haven't heard of them. They operate in 60 countries, more than 9,000 employees and more than 400 patient care centers, big company, EUR 1.5 billion in revenue and EUR 300 million in adjusted EBITDA. And they're now our largest shareholder. They own 10% of the company. So, we are working with them to explore opportunities for development-related and commercial collaboration. From their CEO and owner, Professor Hans Georg Nader, ONWARD Medical has the potential to become a game changer in the therapy of spinal cord injuries with its innovative solutions. Our investment in ONWARD is an investment in the future of medical technology. We also recruited a new Board Chair, whom I've known for about 25 years, Rob 10 Hoedt, former Medtronic President and Executive Committee member, 3 decades of experience in medtech, successful track record in technology development, commercialization and business model innovation, very creative person and also former Chairman of MedTech Europe, the industry association, so quite well networked. He's now presided over at least 1 meeting. He's been attended at 2 meetings and making a significant impact. Very, very pleased to have him here and have the opportunity to partner with Rob. Nice recognition again. ARC-EX was named one of Time Magazine's best inventions last year and then the most important development that ARC-EX received FDA approval, formerly FDA De Novo classification and U.S. market authorization. For those of you who don't know what De Novo classification is, this is a truly novel device, a Class II device for which there is no predicate. There's never been a device like it before. And this is a quote from the Chief Scientific Officer of the Christopher and Dana Reeve Foundation, calling ARC-EX the first-ever therapeutic option for SCI shatters decades of belief that these injuries were untreatable. The impossible is now possible. Okay. Now I'd like to turn things over to Amori, who will walk you through our full year financial results.

Thank you, Dave. I'm happy to walk you through our 2024 financial performance. So, we closed the year with a total revenue and other income of approximately EUR 1.7 million compared to the EUR 0.5 million in 2023. This increase was primarily driven by grant income recognized from the reverse paralysis program following successful funding negotiations with the Swiss State agency as well as our first commercial sales of 2 RTX systems after we received FDA clearance in December. And one that I can probably mention, as Dave also alluded to, was sold to Mary, our guest on the call today. When we go down to operating expenses for 2024, it amounted to EUR 36.6 million. That is slightly higher than 2023 that came in at EUR 36 million. R&D and clinical -- R&D expenses, including our clinical activities, decreased by about 8% to EUR 17.2 million as we streamlined our external costs. Our main focus for 2024 was advancing the FDA submission for RTX and preparing for the next pivotal study Empower BP. This category of costs still represents approximately 50% of our operating expenses. Moving to marketing and market access expenses. This category rose by 14% to EUR 3.4 million, and this was driven by our commercialization efforts. This included expanding our sales team and increasing engagement within the [ SCI ] community through active participation in key industry events. Also to note, included in the patent fees and related expenses is the cost of securing the exclusive right to Clinatec's brain computer interface technology, as also mentioned previously. And finally, general and administrative expenses rose by 11% to EUR 12.6 million, and this is largely due to the scaling of our manufacturing operations and expanding our commercial infrastructure. Overall, the net loss for 2024 was EUR 35.7 million compared to EUR 36.2 million in 2023. The 2024 result is in line with expectations and reflects our continued investment to bring RTX to market. And if we then turn to cash flow, please. We maintained a disciplined approach to managing our liquidity. Our cash burn for 2024 relating to operations amounted to around EUR 36 million. Our financing activities provided a significant boost with net proceeds from equity fundraising totaling EUR 64 million. And as mentioned, we also repaid and replaced the Dutch innovation loan with a structured facility from runway growth. At year-end, we had a strong cash position of EUR 60 million, almost doubling from the EUR 29.8 million in 2023. This provides us with financial flexibility to execute our strategic initiatives and to support commercialization. 2024 was a pivotal year for ONWARD. We made significant progress towards commercialization while maintaining strong financial discipline and with a good cash position, regulatory milestones achieved and a clear path forward, we are well-positioned to advance our mission and to bring our therapies to market. Back to you, Dave.

Thank you, Amori. Nice job. All right. So, 2024 was very active, and we're out of the gate in 2025 with that same level of activity. Here are the meaningful milestones thus far. In January, we announced the first commercial sales that occurred in late December over the holidays. We also announced that the ARC-EX System was available on U.S. Veterans Affairs online procurement platforms. More detail on that to follow. We further announced publication of a really interesting study out of the U.K. showing the benefits of sustained access to ARC-EX therapy of at least one year. In March, we announced we were awarded grants from the Michael J. Fox Foundation for Parkinson's Research and the U.S. Department of Defense to advance our Parkinson's disease pipeline. We also announced enrollment of the first participant in the early feasibility study to address mobility challenges in Parkinson's using our ARC-IM System. And in March, we announced first-in-human use of our ARC-IM lumbar lead, which is designed for placement in the lumbar region of the spinal cord designed to restore standing, stepping and lower limb mobility. So, more detail on these. So, RTX System is now available for U.S. government and other health care facilities to purchase. It's on the FSS, so federal supply schedule and the GSA advantage catalog as well. So, this enables the VA and other government agencies to immediately purchase the system through online federal procurement systems. This is the first meaningful benefit that we have accrued from our partnership with Lovell. Lovell is a service-disabled veteran-owned small business that serves as our VA contracting and logistics partner. Also, this study came out earlier this year called Pathfinder2, and it was conducted out of Neurokinex in London, sponsored by Spinal Research. The big takeaway here is that there appears to be sustained benefit from lasting access to RTX therapy. They had 10 participants who used RTX therapy for at least one year, and they showed continued and ongoing improvements. Indeed, 4 of the 10 improved their neurological level of injury, 3 improved their AIS classification and 1 switched from complete to incomplete classification. So quite promising, and we appreciate Spinal Research and their sponsorship of this important work. This is from the Chair of Spinal Research, Tara Stewart. It's now time to stop talking about spinal cord injury as being incurable and start talking about it as improvable. And we certainly agree, and that's a nice segue to our session with Mary and Dan. And we're going to -- I'm going to stop sharing here just so you can see them a bit better. Okay. Let me just move there. Okay. That better? Good, good, good. So we're going to conduct this like an interview format. So it's just a bit more engaging for people. And Mary, I'd like to start with you. If you could perhaps share your professional background as well as some background on NextSteps Chicago, the facility where you work.

Yes. First, thank you very much, Dave, for that introduction and for having me to share our experience. So, my name is Mary Jones, and I'm a physical therapist. I've been a physical therapist for over 25 years now, hard to believe. And I am a neuro -- board-certified neuro therapist specializing in spinal cord injury, but also recovery from paralysis across the spectrum of neurological conditions. At NextSteps, we were founded by a person who -- John O'Connor, who had a C4 spinal cord injury, and that he had his spinal cord injury about 20 years ago. And at that time, I actually was one of the therapists who treated John. And back 20 years ago, we simply said, okay, this is what you can do at a wheelchair level, go home and live your life in a wheelchair [indiscernible]. And thankfully, John refused to accept that and said there has to be something out there. We have to really think about curing a spinal cord injury and treating it and not just accepting status quo. And very early on, he established a community-based spinal cord injury specialty clinic for wellness, keeping wellness in the forefront of persons who had experienced paralysis. And through his philanthropy and his never-ending quest for innovation in treating spinal cord injury, he was very up on all the research that was being done for spinal cord injury and made it a mission of NextSteps Chicago to make innovative technologies for spinal cord injury accessible at a community level to persons, whatever their background. And fast forward to 2024, sadly, John is no longer with us. He did succumb to secondary complications of his spinal cord injury, but the mission continues to be strong. And so ARC-EX completely is interwoven into our mission to provide innovative technology to the community and continue that ONWARD quest curing and treating spinal cord injury and improving quality of life for individuals.

I like that ONWARD quest. By the way, thank you for that. So you already answered what was going to be my next question, which is why you chose to be an early adopter. Maybe you can comment on what interested you about RTX therapy and what has been your experience so far?

So actually, I have been using a variety of platforms, you can say, for different devices for transcutaneous spinal cord stimulation since about 2017. And so as a physical therapist, but also I'm academic professor at Governor State University. And so I do have a line of -- my academic research agenda does include transcutaneous spinal cord stimulation. And so keeping up-to-date with what is available and to me to use for this, a couple of things why ONWARD? Well -- and not to get too scientific and because I can totally geek out on all the amazing stuff there. But there are some components that allow me as a therapist to really tailor the type of stimulation that I am pairing with my -- the person that I'm working with, to achieve their task-specific goals. And so there's a lot of adaptability and nuances that align for my ability to treat my patient, very patient-centric, but individually. I always think about a spinal cord injury as being as unique as the fingerprint of the person that I'm treating. And ARC-EX allows me to dial in to each little ridge on the fingerprint. And because everybody presents differently. And so that's the beauty of the system.

And when I visited you in February, I think you had put 20 of your clients on the therapy. I don't know how many you're up to now, but what has been your general experience? Could you share some observations?

Yes. So first of all, I would say that our response rate to -- first of all, I think it's important to align that when I see if somebody is appropriate for ONWARD ARC-EX, we are following through the recommendations, just like the pivotal study, a safe criteria. So making sure that this is safe and the Up-LIFT study did a beautiful job of showing the safety and the efficacy of this device. So following through with that background and parameters, we continue to implement that. And so I do a baseline evaluation to see where is this person just without any stimulation or without any treatment, where are they at? And then we thoughtfully -- based on my evaluation, conduct the trial with the ONWARD ARC-EX and then see what the response is. And as you said, back in February, now we're up to over 30 people being -- having tried it. And I have over a 95% positive response rate with motor return. So the movement. So can I elicit a volitional movement, meaning the person is unable to move their limb or their fingers, their hand, primary -- the upper extremity without any -- with their thoughts. So I want to move my arm, they're moving their arm upon command. So it's volitional, not involuntary that might be attributed to a spasm or something like that or a reflux. This is volitional movement that I'm eliciting from the baseline of no stimulation to a stimulation as well as sensation. So can they feel that part of their body again. So we're looking at motor as well as sensory and seeing any changes with and without stimulation. And again, over a 95% response rate.

That's really impressive. And again, that's just one clinic's experience and Mary is very, very good and good at her job. So I don't want to set that expectation for everyone, but it's certainly a very promising result from one of these 2 early clinics. And we are lucky to have Dan Spencer here with us, who's one of the 30 people whom you've given the therapy. Dan, could you share your professional background and maybe a bit about your -- what you did before your injury?

Sure. Again, I'm Dan Spencer, and I was an orthopedic sales rep for 40 years. And so I retired 5 years ago and had every thought of just traveling and enjoying life. And I was in -- I went to ski with my wife and a group, went to ski in Switzerland. And when I was there, I was on a pretty steep area. And due to my own fault, I fell and immediately knew I was paralyzed. And so I was taken to the hospital in Bern. And when I was there, they put in 2 plates, 4 screws and a cage where my fracture was, which was at C34. And the -- everyone everywhere has told me that the surgery was very, very successful and had been done incredibly well. So I had that going for me. The thing that always surprises you and you don't expect to hear because being kind of a positive person, it's kind of like, okay, what do I got to do? How do I get out of this? And I was told basically by 3 surgeons in 2 countries that I would never move again, not just walk again, I'd never move again. Well, obviously, you don't want to accept that and you want to prove people wrong. So I started rehab pretty much as soon as I got back into the states and in Chicago. And after several months, found my way to NextSteps. And Mary has provided me with an opportunity to try ARC-EX. And it has, I would hope to say from everything everybody is telling me and the way I feel myself, is basically a game changer. What I have -- as a quadriplegic -- oh and just to let everybody know, I have been a quadriplegic for just over a year. So I'm really kind of early in this entire process. And so the way it has worked for me is that you need to be able to learn how to identify the muscle that you want to activate because naturally, in the beginning, what happens is you want to activate -- you just want to get moving. So you end up activating everything and you get nothing. It's specific muscles do specific things. And so that's what you need to have your brain be able to try to help you identify. Well, for me right now, the circuits are pretty haywire. They want to go to the right place, but they don't know how to get there. And so they go everywhere. And so what happens is with ARC-EX, they attach a couple of electrodes to the back of my neck. They put the out electrodes on my iliac crest, which is where my hips are and then are able to then turn up the stimulation. When they do that, and I go to activate the muscles or the muscle that I want, I can actually feel it better. I can identify and basically isolate that particular muscle so that I can focus on that particular movement on what it does and what it's supposed to do. And it just helps me do that much quicker than I could without it. And that's very important because that's the only way that I know of to be able to get better is to be able to work the right muscles to do the correct activity.

Well, thank you, Dan, for sharing that. And it's still early for you. You haven't been on the therapy for that long, but is there anything in your daily life that you can point to where you've experienced an improvement or it's had an impact?

Absolutely. One thing for sure is in my hands and in my fingers. I can move all my fingers in my hand. I can also move my wrist and I can bend my elbow 90 degrees from a straight position. Everybody is working me at NextSteps in order to be able to get me to get my hand to my mouth so that I can feed myself. And so I like to say I'm kind of halfway there at 90 degrees, but I need the rest. And I'm also weak as far as being able to raise my hand. So I need to use like -- what they have is like a Saebo, which kind of keeps my arm up -- elevated so that I can then -- they can help me kind of bring my hand to my mouth. It will be a slower process, but I'm getting there, and I'm getting a little stronger all the time.

Has it affected your, let's say, social life engagement in any way? Are you doing things that you wouldn't have done before?

Yes. I actually had some friends over a few weeks ago, and they brought a board game over and where you throw the dice. And I was able to pick up -- I couldn't pick up both dice at the same time without it taking too much time. So I picked up one dice and through it and then through the other dice. So that was probably the first activity I've done since the fall. It was nice to be able to do that.

I saw you looked over to your right. So I'm wondering if your wife, Christine, is there, and I don't want to put her on the spot, but I'm hoping Christine can maybe comment on the impact ARC-EX therapy has had on you, Dan, and what she's observed.

Thank you for asking me. I don't -- I do go to therapy with him sometimes, but sometimes I stay at home and just try to keep everything going along. But the thing that I have noticed the most is, as he said, with the stimulation, he has more control over his different muscles. And when he comes home, he feels like he's accomplished so much. And the one thing that we've learned about spinal cord injury is that it is a long and arduous road. And to give him hope and encouragement and to feel like he's making improvement helps his attitude so much. And that's probably for me, the biggest thing that I've seen with him. He's encouraged and he's happy.

Thank you so much. Thank you so much for sharing, Dan and Christine and Mary as well. Thank you for joining. Very generous of you. I know it's early your time as well. So I think let's conclude this portion and open it up for questions, and we'll give the question box a little bit of time to populate. Has anything come in from the -- Oh, sorry, I have more to do. I was reminded by my team here. So let me share again. This won't take long, I promise. I promise. Okay. Yes, you can see that. Fine. Okay. You saw their beautiful faces already. So this is the outlook for 2025, and I'll keep it simple here. Again, my Zoom screen is kind of covering it. But what do we expect going forward? This is a catalyst-rich year 2025. We're looking for home use authorization from the FDA. We're looking for CE mark so that we can commercialize this in Europe and other countries that respect CE mark. We're looking to also have first commercial sale outside the U.S. That's all for ARC-EX. For ARC-IM, we are looking to publish the results from the clinical feasibility study, the first 14 people to receive this therapy for blood pressure instability after spinal cord injury. If you want to talk more about that, we have an expert on the line in Mary. Also IDE approval from the FDA to start our EMPOWER-BP global pivotal study using the ARC-IM system and first participant enrollment in that study. And then also using ARC-IM to address bladder, so urinary incontinence. Currently, today, people with paralysis, many of them have to insert a catheter every time they urinate, which is difficult, but also can lead to frequent infection and so forth. And we expect to announce additional brain computer interface implants as they occur throughout the year. So again, a catalyst-rich year upcoming. And hopefully, now, Alex, I'm done. Yes, one more thing. We're going to do our first quarter update. This is a 2024 full year update. We're going to do our first quarter update on June 17, just because we wanted to create a bit of space between now and then so that there's time for some of these milestones to hit, and we've got a lot to talk about at that point. Okay. So now we can go to the Q&A.

I have a couple of questions. As well, let me know if anybody raises their hand, one of our analysts. Let me take it first from David Peppers. Okay. I'm going to take my glasses off. All right. Let me take David Peppers, and we'll go to Thomas from KBC. So David asks about the current indication for use and the scope of the FDA approval. Right now, it's for use in the clinic only, and we're submitting a 510(k) to get expansion of the labeling so it can be used in the home. These are the target population of people with tetraplegia, not so easy to get to the clinic frequently. So we really do want to make this technology available for use in the home where it can be used more frequently even on a daily basis to facilitate better recovery. All right. Thomas, let's turn on your line. Go ahead, Thomas. Thomas Vranken.

Yes. And of course, congrats on the big progress in 2024. Really exciting to hear also from the physician and the patient that the therapy is really working. A couple of questions from my side. Maybe first of all, could you share some sentiment on the ongoing commercialization where you stand there? We understand that now in Q2, you would be going to that next stage. What does that mean specifically? And also in terms of ramping the organization, how do you think about that going forward towards this year? And then as a second question, I maybe wanted to ask Mary Jones if she could provide a bit more detail on how the ordering process went. I assume you did that directly with ONWARDS, so not through Lovell, but it would be interesting to have some insights there. And also on the side of the patients, whether or not they are already able to get the therapy reimbursed, et cetera? And then maybe a final question for Amori with regards to the runway financing, if you could speak with regards to the requirements that are necessary to unlock the next tranche of financing there and whether you are on track there?

Thomas, you got your money's worth. I would have let you do a follow-up. It was a good thing I took notes. So -- this is a limited launch. That's what we said would happen. We're spooling our production. And as well, we hired our initial sales organization. We've got 6 territories. Those folks are hired, trained. They're out there now conducting evaluations and detailing the therapy. So everything is proceeding according to that plan. I don't want to comment too much on first quarter results because we have another call for that. This is a full year results call from last year. But I will say that, again, things are progressing as planned. The interest level is high. The activity level is high. And at this time, we have no reason to question analyst consensus. So the projections made by yourself, Thomas, and your 4 colleagues from the other banks. So that's about all I want to say on the -- in terms of sentiment and guidance is there's a lot of interest in this, and people are calling Mary and people are just really interested in how this thing is working. So now let's take the rest of your questions in order. I'll quarterback this a bit. Mary, what was the ordering process like for you?

Very, very easy. We didn't make known our absolute interest in the device. And the ordering process is very simple. I let them know that I would like the device. We wrote a check and it was delivered. Now, that being said, we're here in the U.S. So if there's anything with customs or anything like that, we didn't experience any, but those would also be potential hiccups, I guess, I would just call them hiccup. But ours did not have any issues with that. And I had the device within, I think, 2 weeks of the whole process, start to finish.

Yes. And then Mary, you -- he also asked about reimbursement, which doesn't really apply because we don't have home use yet, but you're billing for the sessions and technology-assisted sessions and things of that nature. And so for you, it's a...

Yes. So from the U.S. standpoint, because we have a variety of different carriers for a reimbursement, there's many modes how that can happen. And essentially, there's a little bit of an art to negotiate or navigate, not negotiate, navigate how reimbursement looks. But essentially, as a therapist, I am billing any insurance, Medicare or commercial for the therapy that I'm doing. The -- yes, and I document that I am -- my parameters and what I am doing with the device, but I'm not necessarily billing for the ARC-EX. There isn't a true billing code that represents this. And so from a clinic decision, we have been billing for our therapy that we provide because -- and this is just my personal opinion, this is such groundbreaking revolutionary technology. I do not want to misrepresent that technology by using a general code that is similar to a [ unit per ] totally different. And so I -- that's just my opinion. And so that's why we, as a clinic, have chosen not to do that type of billing, the billing for our therapy services. So that's therapeutic exercise, therapeutic activities and neuromuscular reeducation, which is really what we're doing at this stage of the game. So that's what -- how we bill it on our side.

Thank you, Mary. And Amori, do you want to talk about Tranche 2?

Yes. So we did meet the milestone to unlock Tranche 2 when we received the FDA clearance in December. Tranche 2 is available to us to draw down until the end of 2025, and we will draw it down in the course of this year when required or when needed.

Yes, Thomas. So we've already qualified. We don't need it, why pull it down and incur interest expense. So we'll pull it down at the latest possible moment. Okay. So Thomas set the tone here. So I have to be fair to Maria and Ed. Maria, why don't we do ladies first. You can now ask 5 questions, if you wish.

Yes. Great. I would like to start with Mary Jones, and I would like to ask her a bit about her experience. Obviously, you're super experienced with 25 years in the clinic. And I was wondering what kind of technologies have you come across that could get close to RTX or not even? I mean, obviously, it's pretty groundbreaking technology, but any other things that you see on the market? And also how easy it was to get around the technology to use it for the first time. I believe you were not involved in the pivotal study. So how easy was the onboarding? And what was provided in that sense from Onward? Thank you.

So we received training. So Onward did send their clinical expert who I believe he was involved at some point, I don't know what center exactly during the study and so he came and he trained us and very generous with his time because we also did have a patient who met the inclusion criteria. And so we paired it very well with a live demo, and that really was unique to the experience. So it wasn't like the device was dropped off and said, okay, here you go. Good luck with things. The Onward personnel actually took time. We troubleshot with a live patient. And so everybody got a true authentic hands-on training experience with that. I -- in full disclosure, as I said, I have used transcutaneous spinal cord stimulation for a number of years. So I'm pretty averse in that, maybe not every clinician would have that experience. But -- so I have -- I'm pretty familiar with, but the device is very easily used. It's clear cut. It's after your training, you do know what parameters, what safety features to use. And it's -- they've done an excellent, excellent job of setting up the pad that pairs with the actual stimulation device to -- the clinician can walk through and there's a nice visual. So there's no confusion as to, oh, did I put the electrode here or there? It's -- and your leads are very clearly identified. So it is very -- even this can translate, I see to home use very easily because they've done such a nice job setting this up for any -- pretty much anybody to use.

Thank you. Yes. I wanted to follow up specifically on that on the home use. For now, obviously, only approved in the clinic, but once they get the home use approval, how do you see this transition and how you see it from patients that you're already training? And will you actually recommend this extended use in home use, let's say, for the majority of your patients or do you think it's more depending on the cases?

So as I kind of said earlier, yes, every spinal cord injury, I kind of think about it as a fingerprint, right? It's very unique and it's unique to that individual and each individual has their own goals. That being said, I think that the transition to using this at home is an essential but natural step because as with any therapy, I have somebody that I kind of think of myself as a coach. I'm that therapeutic coach that teaches them, empowers them to do this on their own. And sometimes that does involve a caregiver, so I'm instructing caregivers as well. But I may be only able to see somebody in the clinic 2 hours a week. If we know from just common wellness principles, we should be doing something every day as humans. We are -- we need to move every day for health. So this is a natural transition if this tool can get into the homes, that carryover, that's huge. It is going to be life changing, life-changing for people because they now have control for health and wellness to have control over your own health. I mean, what a restoration of a basic gift that could be for people. So I'm 100% supportive. I am fully -- there are safe ways we can implement the technology within the home so that people and their loved ones can continue their journey towards -- it's almost I really do believe that this can be limitless, taking away the barriers. So I don't have any concerns about safety and efficacy. I think we can program -- they meet with me, program it. I give them the exercise program. They go home and execute that. They come back periodically to check with me. I might be able to change parameters. We troubleshoot via telehealth. I think that this is a natural but essential partnership for continued recovery. I really do.

Thanks, Maria. All right. So we have a couple of minutes. Let's go to Ed. He's had his hand up for quite some time.

Just first question would just be on EMPOWER BP. Any updated thoughts here along the clinical trial design, number of patients? Any updated thoughts here would be great. And then maybe second question, I have to ask it, just given the uncertainties around tariffs, the pass-through of anything that's sort of imported, is this a hit to your P&L? Or is the list price change? Any thoughts there would be great. And then maybe a question for Mary, on the number of traumatic cases you have in the SEI population. I think Dan mentioned the use of plates and screws. I mean, is there any efficacy here difference between someone with plates and screws inserted near the injury or not? I'd just be curious to find out.

All right. I'll take the first 2. First, for EMPOWER BP, Ed, we want to wait to talk -- to provide more detail about the study design, outcomes measures, things of that nature until we get IDE approval. And then there's absolute certainty what the design will look like, and we're getting close. So that's, again, something we've guided we'll receive, we believe, in the first half. And then we'll probably convene a webinar like this, a KOL webinar and go through the indication in detail, the need, but also the study design and how we intend to conduct it. So that's an upcoming event. As far as the tariffs are concerned, we don't believe we have exposure there. And indeed, we may be exempted from tariff exposure because there's something called the Nairobi protocol that exempts products that benefit people with long-term disabilities. So if indeed, tariffs are applied to this category, we're going to apply for an exemption under the Nairobi protocol, and we're hopeful that, that will be successful. So we're staying abreast of developments there, ever changing, like a lot of things in the world right now. And -- but at this point, we don't foresee that, that's a problem. And Mary, would you like to answer Ed's question about the impact of hardware on or around the injury site and how that impacts therapy delivery with ARC-EX.

So thank you for that question. Thus far, and actually, in all my experience with the transcutaneous over the years, I haven't ever really had any issue with the hardware being impacted. Once in a while, what will impact is the scar tissue formation over those incisions. So if the person had a surgery posteriorly to sometimes that scar tissue can be thickened and it may have a little bit of impedance with that, but there are some nuances that I found to work with that or somebody might have the shape of the scar might be more cavernous. So being that this is where being an older experienced seasoned therapist because back in the days when we used to use sponges for peripheral stim, you can do some adaptations to the electrodes to still deliver safely the electrical stim. So we haven't had any adverse and the same with the UPLIFT study, there were no adverse effects with that. So there are other -- there is a unique feature that is unlike any other transcutaneous device out there that ONWARD -- the ARC-EX has, and that is something called the carrier frequency. And the carrier frequency, in my experience, number one, makes the delivery of the stimulation very comfortable to the patient. There's no -- sometimes with other devices and other methods of doing transcutaneous spinal cord stimulation, without carrier frequency, it can be a little overwhelming to the nervous system and the person will get into a very co-contracted, meaning a very stiff position. So the whole -- the nervous system is excited and the person becomes very stiff and then you have to kind of modulate around that. The ARC-EX system has a carrier frequency, which was -- again, I can go down the rabbit hole with this technology. But the ARC-EX has this carrier frequency, and that makes it extremely unique and adaptable and malleable to the patient of a variety of levels. And we're learning every day with this. So this is stuff that my mind goes where with this specific, with ONWARD's technology, we are able to treat a variety of different presentations with spinal cord, again, safely, but with high efficacy with dialing in. And Dan, I'm going to borrow words from you when you had a panel. Could we get to recovery eventually? Yes. But what this device does, it makes it a lot quicker. I mean, immediate to within 3 sessions, I'm seeing stuff where before I might have 10, 12 sessions, but that I'm seeing exponentially faster. And I believe it is wholeheartedly due to some of this extraordinary scientific technology that, whoever is the magician in the back room has assembled and has put it into this beautiful package that I'm able to go ahead and use clinically. It really is remarkable.

Thank you very much. We're over time. I want to be respectful to Dan and Mary. So I'll conclude here. Thank you again so much, Dan and Mary, for sharing your time and your experience with us. Thank you, Christine, as well for your cameo there. And there are some additional questions. I'll try to answer those via e-mail. But again, thank you so much, everyone, for joining. Thank you.