PROCEPT BioRobotics Corporation (PRCT) Earnings Call Transcript & Summary

Good morning, everyone. Welcome to PROCEPT BioRobotics Investor Event. Please review our safe harbor statement. My name is Reza Zadno. I'm President and CEO at PROCEPT BioRobotics, we have a great agenda for you today. Kevin Waters, our Chief Financial Officer; Hisham Shiblaq, our Chief Commercial Officer, and I will provide an overview on the company, talk about our Q1 results and 2024 guidance and provide a commercial update. Barry Templin, our EVP of Technology and Clinical Development, will talk about prostate cancer and also conduct a fireside chat on the same topic. But we are very thrilled to have three very experienced surgeons here today who will talk about our correlation that is currently used in BPH and its potential to be used in prostate cancer. Dr. Kriteman, from Georgia Urology, Dr. Helfand from NorthShore, Chicago and Dr. Gill from USC. Thank you. Before we start the meeting and talk about numbers, I think it's important that I talk about PROCEPT and what our strategy is. Our vision at PROCEPT is to become a leading global urology company. And this is not just a statement. It's our guidepost that guides us through all our decisions throughout this journey. Because patients are at the center of everything we do at PROCEPT, we believe through working with surgeons, listening to them, we can introduce innovative therapies that is backed by high-quality clinical data. You have seen the progress that we have made in the last 3 years with the installed base, our robot utilization that shows how we are, where we are on that journey to become standard of care and our revenue growth. We will remain focused on that, and we have made great progress. We have been very focused and very clear that our objective is to become BPH standard of care in the treatment in the receptive market in BPH. And we will continue that focus. In the last few years, our KOL surgeons have been asking us about to study the Aquablation for the treatment of prostate cancer. We believe this is a very logical second indication for us, and that is why we have started the studies that we're going to talk about today, PRCT001 and PRCT002. If you look at these two applications, you will realize that it makes perfect sense because there are very similarities that in both patient groups, men about 50 years old, treated by urologists. And current treatment, there are challenges with them, whether it is for treatment of BPH, whether it's for the treatment of cancer. And patients are faced with making compromise decisions for treating there with a condition. And similar to BPH that we have shown how we are installing our robots, and we are making progress and increased adoption, we believe by studying Aquablation in prostate cancer, we have the opportunity to bring a therapy that's a better option for patients. We believe with our vision, we are laying down the strong foundation for continued growth. And that is, as I mentioned, is listening to and partnering with urologists and obtain best-in-class Net Promoter Score, deliver innovative technologies that's supported by high-quality clinical data, grow our brand awareness and increase shareholder value by overall financial discipline, ensure path to profitability. And all of this continue on this large and underpenetrated BPH market while we are expanding into the adjacent prostate cancer. So with that, I'm going to let Kevin come and talk about the financials.

Thanks, Reza. Good morning to everybody on the web. Good morning to everybody in the room, to our customers. Thank you for being here. We greatly appreciate your participation. Really excited to share and review our Q1 results with you today. We reported results about 48 hours ago. This is a recap of our first quarter revenue. And you could really see here that all of our metrics around system sales utilization, international sales really were firing on all cylinders in the first quarter. We're really pleased with the performance. We reported $44.5 million of revenue. That's 83% growth on a year-over-year basis, and that was strength across the board, and I'll start giving a bit of color on our systems. We sold 38 AquaBeam Robotic Systems in the first quarter of 2024. We also placed our first unit, which is not included in that 38 at an ambulatory surgery center on the East Coast. Hisham talked a lot about that on our call, that's our early entry into the ASC market, and it was good to see that. We also saw average selling prices in the first quarter north of $370,000, which again is trending in a positive direction. And we now have a U.S. installed base that's north of 350 units, at 354. When I switch to utilization, which is defined as a number of procedures and account does in any given month, we've experienced 7% growth year-over-year from Q1 '24 to Q1 of '23. And that's impressive. And it's impressive because our installed base has grown so significantly over that same period of time. And as our installed base continues to grow, the new accounts are having less and less of a dilutive effect on our overall utilization and all metrics that we're tracking around these new accounts are trending in the right direction. And a few of those, we keep a definite close eye on internally. We look at new surgeons per account, how many surgeons are now performing Aquablation when a system is installed. That number, when I first started 5 years ago was typically one surgeon per account. We're now launching accounts with multiple surgeons doing multiple cases in a given day, and that's leading to increased utilization, which is good to see. And then as Reza mentioned, having our high Net Promoter Score has led to a great surgeon retention rate. So in any new technology, you need to be careful of, what's known as the leaky bucket, where you have new surgeons coming into the funnel, but you also have an equal number falling out. We're not seeing that. We're seeing over 90% of our surgeons that do an aquablation procedure in 1 quarter, continue doing cases the following quarter, which is great. Means that technology is sticky. It means clinicians and patients are happy with their results and it's fabulous to see. And then lastly, our international business is quietly really coming into its own in 2024. You can see the revenue here is 65% growth. We're seeing great momentum in the U.K. And I really analogize the U.K. market as to what we experienced in the U.S. early on 5 years ago, where we're leading with data, we're leading with good results. We're going slow initially to go fast later. And this is going to be a market for us that we think is going to be a tremendous opportunity over time. Revenue is important. But as Reza mentioned, we're also now as a company highly focused on the path to profitability and make sure we can not only have a great product, great results, but building a great business, and a great business at the end of the day, needs to make a profit. And that really starts for us with gross margins. You could -- our reported gross margins in the first quarter were 56.2%. That's compared to 49% in the fourth quarter. And this is primarily due to two things. One, it's leveraging our fixed cost infrastructure now with a greater revenue base. The cost profile of our product today is already in a good spot for us to expand margins. So now it's just growing into this base that we've created to support not a $200 million business, but a $1 billion business. And that takes time to grow into and that manifests itself with improved margins over time. We moved into our new headquarters in the third quarter of last year. We're now firmly in this facility. We've seen already improved efficiencies in this new facility around things as scrap, yield and production and really pleased with margins. I think 2024 is a transitional year for this company where we're going to exit the year at north of 60% margins, and I think we'll demonstrate a very clear path to profitability in 2024. So how does that look for our guidance and how did we update this a few days ago. We've now raised our revenue guidance to $213.5 million, which represents 57% growth over prior year. Our gross margins now are forecasted to be 58% to 59%. And operating expenses, if you look at our operating expenses, that 2x that's denoted on this slide means that we're growing our revenues at a the rate we're growing operating expenses, which is already demonstrating tremendous leverage for an early stage medical device company. And I think, again, when I look at the fourth quarter, that year-over-year growth in OpEx is going to be in the low 20%. And it's going to be, I think, demonstrated a very clear pathway to show a path to profitability in the not-so-distant future. So with that, I'm going to turn it over to Hisham Shiblaq to give an update on the commercial team.

Good morning. Thanks, Kevin. I'm going to spend a few minutes talking a little bit about the commercial strategy on insight on how we think about building this business and growing for years to come. And I think the first thing we start with is looking at this large BPH market and the fact that even though we've had some great momentum in the early years, we're getting a lot of stickiness, like Kevin said, we remain really under-penetrated in this opportunity, and that's very exciting about what's going on here. With as much excitement as we have in our installed base of getting the 350 installs, one of the fastest-growing robotic companies ever. We still have a long way to go. There's over 2,700 hospitals in the U.S. that do BPH surgery, hyper-focused on that area, and we think we've got a lot of momentum to get way beyond the 350, which is just 30% of the market. When you look at the utilization of a high-volume BPH hospital, they do over 200 resective procedures a year at 17.5 cases a month, and we've now just begun to penetrate the first couple of surgeons, as Kevin talked about in these hospitals. Our average utilization, and we look at the estimates for 2024 is about 7 procedures a month, which, once again, in those installs that we currently have, we still have a lot of opportunity, and we'll continue to work on that, and I'll talk about that here in a minute. And when you look at the surgical market in the U.S. and about 300,000 resective procedures a year, once again, 2024. Our estimates are about 33,000 procedures. Still a lot of room to go, and we're in a great place as we exit the year, 11% of a ton of momentum. Developing a wining culture. So when you think about PROCEPT we think about all the things that we've accomplished, our primary goal is whether sent start this talk is to become the standard of care and BPH. Sounds great. A lot of companies have said that. But the reality is disrupting a market, which is large in size and BPH, taking out a market leader in service for 100 years as people have tried and nobody's ever had success doing that. Some technologies have made a dent, but not sustainable. We believe we can change all of that, and we're on a pathway to do that. Clearly disrupting the standard of care requires unbelievable technology. We think we've got something that's really special on the technology side, but you have to have a culture a winning culture in order to really get to that point where you disrupt the standard of care. And that's what we believe we built at PROCEPT. When we think about talent acquisition is where it begins in our field sales team, we've hired the best of the best. We have folks that have been with the most successful disruptive companies in the space. They've been the top of the class, and they've joined our company and are part of what we're building, everything from the capital team to our team that drives utilization of clinical outcomes. They've been with great elective procedure companies. So we have this hodgepodge of experiences that we put together at PROCEPT and working actively together and shows in our patient surveys and we get it back to put the customer experience. When you bring all this talent on board, it doesn't stop there. We've invested significantly in the onboarding, onboarding and training and development of those individuals to make sure that because we also bring on talent, but that we've got them ready to go so that we have great clinical outcomes. And when you think about PROCEPT. When we think about commercial execution, really what we're talking about there is our ability to deliver what our customers want. And our ability to do that starts with clinical excellence. One thing we've said from the day 1 is that the priority of this company is to ensure an outstanding patient experience. Patient experience means they feel good after the procedure and the procedure works. We can only do so much with that experience. And we do everything we can within our control to train our surgeons properly and to make sure everything that happens within that operating room goes as smoothly as possible. And I think, once again, our results are showing it's working. On sales excellence, what I would say is that we've always been a data-driven organization. We can have great salespeople. But if they're all doing different things, if they're all running to the wrong places, you have an organization that's not being efficient and effective. We don't have that with PROCEPT. We have been a data-driven organization. Everybody is really clear as to where we go and where we focus, and our strategy matches that so that every single individual organization who has a playbook, understands their role, and does the same thing so that you have a footprint across this country that everybody doing the same thing, and that's how you build momentum. And then last but not least, I would say that the discipline that we show on the clinical side and the sales side needs to carry on as this organization now in order to disrupt the standard of care. All of that being said, we have three surgeons here that I think hopefully can speak to and testify to the fact that strong partnerships are the key. Launching a program is one thing, having continued success is a whole another thing. And as Kevin and Reza both mentioned, we're extremely proud of our ongoing Net Promoter Score being world class year after year. We take a lot of pride in that, and we do everything we can to make sure our customers have a great experience. So I'm just going to spend a minute on utilization and on capital, and then we'll wrap this section up and get it over to the surgeons. But when we think about our ability to maintain the strong momentum and increase utilization, we have our largest and most tenured utilization team right now in the field. The retention rates are outstanding. The consistent and repeatable clinical outcomes are the foundation of our success. But something that's very unique that's not really discussed a lot in the world of BPH is that historically, for a urologist to be seen as taking the best care of their patient. They've had to offer 3, 4, 5, 6 different BPH options to their patients in order to tailor that treatment for that patient. That's what good care has always looked like in the field of urology. For the first time ever, we're getting to a point with Aquablation where you don't need to do that anymore. And our ability to standardize treatment options in an office is what our ultimate success will be led to. And with that, there's kind of three phases of our utilization approach. The first thing we do is educate our surgeons. We have significant opportunities for our surgeons to find out more about the technology via hands-on experiences, virtual experiences, and then when we get those experiences, we obviously accelerate utilization by adding more and more surgeons, there are over 10 surgeons that do BPH surgery in a high-volume hospital. So we're just getting started with that acceleration as well. And then targeting. So we've now begun the process of getting a footprint in a local community or local hospitals. We work very closely with our hospitals to educate the community and drive patient awareness. And you'll see that through press releases, online marketing, all being driven by our local hospitals, a lot of great support from our customers. On the capital side, I mean we're in a great position to continue the momentum we have what you'll see on the left-hand side is 2023 first quarter compared to the first quarter of 2024. As you work your way down from top to bottom, obviously, we've increased the number of sales reps. We've talked about that. But really, the tenure is the most important thing here because building a capital pipeline requires time and energy. And as the longer you have people on seats, the more effective you can be in selling capital to hospitals. And you can see not only have we grown our capital team by over 30% but the tenure has increased by 9 months. So we are in a great position, which also talks about employee retention, if you do those metrics together. We've added a junior capital rep team. What I'll say about this in a kind of a simple format is we have a pipeline, we track very clearly. We have great data on our pipeline. We watch our customers move through the capital phase. We start tracking them in what we call Phase 1 all the way through the sales process. We have something we call Phase 0. And historically, our senior capital reps we spent a lot of time and energy building momentum in the Phase 0 to get them into the sales process. We've now brought on a junior team and their primary responsibility is to build that Phase 0, come to Phase 1 and pass it off to the senior team. So we're excited about their opportunity to be impactful this year. Strategic account team we've talked about. What's the goal of that team is a lot of support from the ground up with our surgeons and our local customers, now getting the IDN support from the top down, understanding every IDN is different, understand the strategy of those IDNs and matching it at a local level to be really important for our long-term success. Capital environment, I think it speaks for itself for a stable to hopefully improving environment, but last year was a whole different story. On the IDN contract side, we've signed almost every major IDN. So once again, it's not only just a license to hunt, but the speed to sale improves significantly when you have a contract that's signed. And on the reimbursement side, we now sit here with almost 100% coverage greater than 95% of lives are covered in the U.S. And last thing on the tailwinds. When you start with the improving hospital CapEx environment. This is going to continue to kind of to be our engine here, driving more hospitals to other technology, great tenure in our sales force in all aspects. The pipelines continue to grow significantly. As Kevin mentioned, we're launching these hospitals with multiple surgeons, which gets them up to that ramp real quick. And then the last thing on international. The opportunity is vast internationally. We've been very, very thoughtful and deliberate in where we spend our time and energy. And we've talked about this market development that we do in these markets, and that's really what we're doing, working with KOLs, doing some local clinical work to show the ability to reproduce results in local areas. And we will continue to do that to impact reimbursement in certain markets. and then you'll see us start to accelerate significantly once we get to that point where reimbursement becomes an area where we believe we can win in a big way. That's happening in U.K. in '24. I'm excited to share with you all what's going to happen in '25 with a few other markets. And with that, I'll pass it over to Dr. Kriteman.

Thank you. I'll check this first. Make sure I'm good. Sham, thank you very much, Reza, thank you very much for inviting me today to come in and talk to you all about my adoption of PROCEPT Aquablation and sort of how it all happened. This is interesting for me because I sat on the other side, 25-30 years ago as an investment banker on Wall Street in health care and biotechnology. And so full circle for me to come and do this now as a urologist. So disclosures up there, my consulting disclosures, you can see, I'm a partner and an Executive Vice President with Georgia Urology. Georgia Urology is the largest privately held physician, privately held large group, [indiscernible] in the United States. We have our owned by ourselves, which is unusual. We are in Atlanta and around Atlanta. And over the past 6, 7 years, we have installed 7 Aquablation systems that me and my partners use around the city of Atlanta. I have 27 partners as of yesterday, who have been trained and who have done at least 10 cases on Aquablation. Many of us have done hundreds of cases of Aquablation. And last year, we had 960 cases that we did in my group. So those 27 and fewer urologists at that time. We almost did 1,000 cases last year. This year, we hope to top that. So one of the issues that I've seen in my practice is mainly avoiding dysfunction in both males and females, but lots and lots of BPH. And I have done pretty much every BPH procedure that's out there. I teach other BPH procedures as well. And one of the problems that we see with the group of resective procedures out there, are manyfold. Sometimes it's difficult for surgeons to learn the technology, and it can take 50 and 100 cases to learn a more complex way to take care of BPH. So the learning curve really can be very, very steep. And having taught some of those procedures, it can be very frustrating for me to see urologists that aren't able to master these procedures. When we get those patients to the operating room, it's critical that we know basically, how long is it going to take me to do this case? How many cases can I do in a session? Because I have other things that I need to do. I have other patients that need my attention. And so knowing how long a case can take and how many cases I can stack in a morning session in the operating room or the afternoon actually has become very critical as our time gets really crunched. Many procedures, resective procedures out there really have lacked innovation over the years. And we see -- they hit the market 15, 20 years ago and nothing's really changed. And Sham mentioned doing a TURP, which really hasn't changed very much over the past 50, 75 years. We've added bipolar, previously were just monopolar, but there's been very little innovation in the resective arena that would lead to better cases. And then lastly, the failure to preserve sexual function. When we started doing this, we urologists, and if I look at Brian and Inde here, I'm sure we would all agree that 25 years ago, we didn't even talk about sexual function when we were doing a resective on a patient. It was a given that they were going to lose their ejaculatory function and erectile function plus/minus. And now this really is being talked about and patients are coming to us and there's a heightened awareness and less of a taboo to discuss this in the office setting. So it's easy for me as a surgeon to sell this procedure to patients. Patients want this. It's a customized treatment. Every patient is going to have an individualized treatment. So when you're in there and I have a probe that's looking at your prostate, I'm going to draw out your prostate at that time. So it's real-time individual customized procedure. The outcomes, the 5-year data that we presented last year for both Water I and Water II was exceptional. And when we compare it to a lot of the other procedures that we do, it really leads the pack as far as the results are concerned. Patients know that. They're really tuned into these types of things nowadays. The sexual preservation is huge. There are other companies at this meeting that have sort of led the way in talking about sexual preservation, ejaculatory preservation. And we've been lucky enough at PROCEPT and those of us who do these procedures to piggyback on that information and really patients, they're talking about this. They're bringing this to our attention when we're having the consults. And then the postoperative recovery period for most of our patients because we're essentially just using room temperature saline to do the procedure, their postoperative period tends to be a little bit cleaner, a little bit better than some of the other procedures where we're really delivering a lot of energy into the prostatic fossa. I teach a lot of Aquablation. I have surgeons that come through my operating room, many surgeons every month. And so for me to sell it to the surgeons, I think, is also a very easy thing to do. The outcomes are consistent, so they know what's going to happen to their patients. They know what kind of phone calls the surgeons are going to get from their patients. It really can be a procedure that you can apply to most prostate, so it's all of size and shape. And that's a little bit different. So again, Sham mentioned having 5 or 6 different quivers in my pack. Now I really can have one that I can push on the vast majority of my patients, and it will give the same result for all of those patients for the most part. We are able, as surgeons, if you have a PROCEPT AquaBeam system in your hospital to retain patients that are in your area and not have those patients go elsewhere. And that's a big deal since I'm a big referral center in Atlanta. I have patients from all over the country and the world come to me. Thankfully, I'm seeing that less and less as other systems are being installed, and the physicians are able to retain those patients in their encatchment areas. And then the learning curve, compared to everything else I've ever taught, this learning curve really is the flattest learning curve. I tell most of my surgeons that they will feel comfortable doing this procedure in 5 to 8 cases. And there are nuances, obviously, and there are things that they're going to learn, and tips and tricks, but it is a very straightforward procedure to do and the surgeons really like that. Lastly, this is an easy sell to the hospitals. When we first came out of the hospitals love this because of the reimbursement. I think the ROI for the hospitals is very, very quick. And compared to some of the other robotic systems that are out there that they may have to purchase, they're really able to recoup their investment very quickly, and they like that. The efficiencies in the operating room I already discussed, the hospitals like that, too, because now I can get an extra case on every session, and we're doing more cases, which obviously is good for the hospitals. If we're able to get this in our market, and we're the first to market, there's obviously advantages to that as well from the hospital standpoint. Just real quickly, the shorter length of stay. We're seeing this getting faster and faster as far as the way we're able to get patients out of the hospital. Brian has championed that in the past. Doing same-day surgeries. And if there was ever silver lining in COVID, and there aren't very many of them, it really did allow us to push the envelope in how quickly we can get patients out of the hospital safely in doing this procedure. So just a few more slides, and I'll hand it over. But in the Atlanta market specifically, we have seen improved patient outcomes. And the patients know that and that's been marketed and we're seeing more patients come, not only to me but to my other 27 partners that are doing these procedures. The standardization that we see really has borne out over the past 4, 5 years of doing this, and we're seeing the same results, again, regardless of size and shape. The brand awareness, and I applaud the marketing team from PROCEPT that's really helped us and help the hospital get the message out about aquablation and about how aquablation is standard of care right now for this type of patient. The local marketing initiatives, the low-volume BPH patients or hospitals that are outside of Atlanta have started to pick this up, and I'll show you a slide in a second where they are installing and adopting, because again, they don't want all their patients having to come up to the big city, and that leads to the market expansion. So in 2019, there were the two hospitals. Those are my [ Northside Main and my Northside Forsyth ] hospitals right there in Atlanta [indiscernible] systems because they really did see the benefit for all the reasons that we mentioned. And then today, we have 15 total clustered around Atlanta, but we're starting to spread out through the rural areas in those smaller hospitals in Georgia itself. So for me, when I just look at my practice specifically, and this isn't my group, this is just me. In 2019, I had 19 procedures. 2023 last year, we did -- I did 180 procedures, and that's almost a tenfold increase in the number of Aquablations that I did. I'm averaging about 15 per month in 2023 and where I see that growth, where I see that -- those cases coming from isn't so much my other resective procedures, but interestingly enough from my minimally invasive procedures. And so what I can tell a patient that I can get them a result that's going to be double that, which they would have if they had a minimally invasive procedure as far as their AUA symptom score is concerned, but still have a very, very good chance of sparing their ejaculatory, their sexual function. That's a win-win for the patients. They really like that. And that's been the big push for the MIS. The minimally invasive procedures over the past 10 years is the sexual function preservation, I think we've been able to capture that. I know we've been able to capture that with this procedure. Lastly, doing educational events. I'm one of the proctors who does teach quite a bit. I've hosted over 1,000 surgeons through my operating room, both live, they come in both virtually. We beam that out. And I'm kind of proud of preaching the gospel of this procedure and allowing all these surgeons to learn the procedure and then go out and do it. learning curve, I think I mentioned, incredibly low, and I have surgeons come back to me after their 10 cases, we sort of round up and see how they're doing. Very, very pleased with how easy it is to do this procedure. And then the predictable outcomes. I don't think I can capitalize on this enough. It really is a procedure where we're getting the expected results at the 5 years we just saw it, and for those of us who have done them a little bit longer for that period of time as well. With that, I'm going to hand it off to my good friend and colleague, Brian Helfand.

Good morning. And can you guys hear me okay? Awesome. So my name is Brian Helfand, and I thank you for the invitation to speak to you guys this morning. I'm the -- always have considered myself to be a little bit of the odd duck in this room because I'm Society of Urologic Oncology trained, urologic oncologist. My focus for the past 15 years has really been on prostate cancer. And I've always kept a little bit of BPH, about 10% historically of my practice. Devoted to urinary symptoms and that treatment really more because I do tons of research and they were great controls for a lot of the studies. My research has historically been focused in on the genetics of prostate cancer, which has really helped personalize that space, and we are increasingly using that information to make better and more informed decisions to offer the right treatment to the right prostate cancer patient at the right time. I would not have thought that, that has now transitioned over to BPH. So when I started at my institution, which is the affiliate of University of Chicago, I was brought on to really help personalize medicine. And now about 6 or 7 years ago, Barry Templin looked at me and said, "I have a one-size-fits-all personalized type treatment for BPH." I kind of laughed at him. I said there was no such thing existed. But here I am many years later, still preaching that same message. Again, here are my disclosures. I do a lot of also research in not only the genetic space but also now within the BPH space as well. I have the privilege of heading up a large urologic group where we're all subspecialized. So there are 5 urologists in our group that specifically focus in on the treatment of BPH and the -- again, the ad val that overlaps there. Since it's the introduction of the PROCEPT Aquablation program in 2018. Our program has also grown like Georgia Urology. We actually have two robots at a single site. So we were one of the first to actually say the volumes at a single hospital are so great that they demand having two, just so that we don't overlap and surgeons and patients aren't waiting. There -- in the hospital, there are 8 AquaBeam users. So again, this continues to expand. Even our holdup, guys. Those are the ones who use the laser surgery, when they joined our practice, they say, we don't need Aquablation and when you look at how they have changed that has become their primary focus. While myself, I have done over 390 cases in the institution, we have done more than thousands. So we, I guess, are considered to be one of the pioneers of the same-day discharge which again was instituted because of COVID because we've got this cool system, and we wanted to get patients on the same day. But now, of course, using those techniques, we -- the country has started to take advantage of this and get people home the same day. So how has this really changed my practice? I actually think that this has actually added to my practice. This is now, and I'll talk slightly about this, is that, this is the first technology that is now really bridging the gap. I've always, again, had that bias toward prostate cancer patients, understanding urinary symptoms among those men has always kind of been put to the side because they had cancer, and we had to treat them. But their urinary symptoms themselves actually drove a lot of people to see the urologists in the first place and may have actually led to their diagnosis of cancer. So I always thought that it had an advantage to treating those patients in understanding urinary symptoms. This is really now combining it. So now that we have, and it's a routine part of the practice, we've standardized the treatment for urinary symptoms for men with BPH and now we're looking at this in men with prostate cancer. Again, we do over 130 procedures, myself annually, and we have many systems. We're now looking at multiple, the acquisition of multiple systems in our hospital. I did just touch upon what was one of the highlights of Aquablation and its evolution. When I started using the AquaBeam system, there really was no protocol. It was just the Water I and Water II pivotal trials, we're finishing, and we still didn't really have a protocol to say, hey, can we get these patients home, are we worried about transfusion. In those initial studies, it was about a 6% transfusion rate, so that was unacceptable and not comparable to kind of other technologies out there. We worked with other people and other collaborators and investigators. We developed a focal bladder neck cautery technique. This is a technique that really made it possible for improved hemostasis. It adds about 10 minutes on to the procedure. But more importantly is a decrease that concern that there was going to be significant bleeding concern. And now when we fast forward, that bleeding risk, when you look at the published literature is less than 1% of transfusion rate, less than 1% takeback rate. And again, that's better than kind of TURP or a lot of the other, even laser procedures. When we look at the large data set of over 20,000 patients that transfusion risk is really now about 0.6% to 0.8%. So really kind of low risk, and that continues to improve. And so much so that, again, we can get patients home that same day because their urine color, which is been the concern is to say, hey, if there's a lot of blood in that urine, they may clot off the catheter, they may require a transfusion, have issues in the hospital that has virtually been eliminated. And yes, we started our same-day surgery protocol during COVID. And again, that was a necessity because we were not allowed to admit patients overnight to the hospital. Again, we just got at that time, the first AquaBeam system in our institution, and we started using it. We're so excited. And then all of a sudden, we said, well, we have to get patients home the same day. That wasn't what we were trained to do. But again, out of that COVID necessity, we use a focal bladder neck cautery, and we're able to get patients home. During COVID, we did over 40 patients. They had large glands. Again, I guess, in Chicago, we have a lot of good Italian beef and a lot of good food, but then also breeds large prostates. And the average prostate size that we were getting home that same day was about 110 grams. So again, that really kind of said, hey, we can handle some of the bloodiest prostates that we know of and safely get them home the same day. None of these patients came back to the emergency room or had subsequent issues. And then again, certainly, that has now fast forward when we look at urologists in this country, but also in -- around the world, Canada, et cetera, that they are regularly getting patients home the same day. Again, what is really become my focus is understanding that BPH and prostate cancer patients overlap. Yes, it really -- for a lot of this originates from the same organ like prostate cancer forms in the prostate and BPH is a benign enlargement of the prostate. And I always tell patients that for the most part, these cohorts are generally separate. Most men are either predisposed, either prostate cancer or BPH. And there's about 15%, 20% of them that are overlapped that are unfortunate that they get both urinary symptoms but also diagnosed with prostate cancer. This is more than a screening effect, and there's a lot of genetic basis for this. But on the other hand, it's easy to think about those population separately. And so what we really started to realize is that there's an era of kind of focal therapy that a lot of times now, we can identify where we believe to be the prostate cancer is based on MRI and other kind of next-generation imaging techniques. And we could use the waterjet to potentially not only resect the benign tissue around, but also use it to get to the capsule where the prostate tumors most likely form. Again, when we think about using the Aquablation, it really is distinct because it's a resective procedure that gets rid of all of that tissue that's kind of not only obstructing for the benign side but also gets rid of that tissue, ablates it from the cancer side, which is very distinct from a lot of the other type of focal technologies that are out there where you either electrocute if you will, a tissue or you use ultrasound waves and you destroy a tissue. This is truly a resective type technique, which is distinguishes it. And I think this is kind of confidential information, but this is -- there goes out of the box. This is one of the first patients that were enrolled in the PRCT002 study. So these are men with lower risk and intermediate risk prostate cancer, either Grade Group 1 or Grade group 2, for those of you who are familiar that we -- our third cancer is really confined to an MRI-visible lesion, a target that we can see. And so this was a 60-year-old Latino American gentleman who had a strong family history of prostate cancer. I actually have treated his brother, et cetera, and his other brother has an enlarged prostate. So he was the lucky one to really inherit both of those characteristics. His prostate volume was 96 grams. Again, we'll talk about that in a second, but that's large. Again, we've grown big in Chicago. He had significant urinary symptoms. His kind of main motivating factor was that he was going to the bathroom very frequently. On business trips, he was the guy who was always getting up for meetings and using the washroom. He or they impaired kind of euro flow at the beginning of a very slow stream. He was initially diagnosed with prostate cancer, a low risk -- or lower risk, really low volume, [indiscernible] cancer back in 2022, his PSA at that time was 5.8%. We have followed him over the past several years, and this PSA has continued to rise. And his MRI has that lesion that we could see also was actually growing in volume as well. And the actual amount of cancer in that area also still remain low volume. But certainly increase in their percentage of involvement in every individual snippet that we were taking. So we talked about various options for this patient. Specifically because of his urinary symptoms and a cancer, he was very motivated to enroll in the study. Again, he had a large prostate, 96 grams. Again, in comparison in New York City, the average prostate size published by Memorial Sloan Kettering is about 50. So this is about double the size. And there was concern saying, well, Brian, this AquaBeam, can it actually get to that capsule. It's a large capsule. Can it actually reach there. And the answer is yes. And certainly, I've had the privilege of doing a lot of -- before there's a lot of cadaver labs and seeing what the power and the extent of the AquaBeam system actually is. And I am convinced it can get anywhere you wanted to reach. So that has really been encouraging. And certainly, in this patient, it was easily able to reach. So this patient had that lower risk Grade Group 2, lower volume type tumor that was really at the right side of his prostate toward the apex. Here is a kind of 3D reconstruction imaging of the MRI. You can see kind of where that is. And what we did was we used the AquaBeam system to plan accordingly to that lesion. So we did actually a total of 3 passes. Again, when we're doing the standard kind of BPH treatment separate from this, we always recommend 2 passes and that's because the data support that 2 was more efficacious than 1. So when we do the cancer standpoint, we do these kind of 2 passes. We do that first pass for BPH, which is really getting as high as we can and angulating up 225-degree span of the waterjet. The second path we're actually going for depth. So we're actually taking that BPH tissue, and we're actually getting as much of that bulk, especially in the 96-gram prostate that we can get. And the third path was really devoted to getting the and removing resecting where that tumor was located from the mid-gland of that prostate to the apex. And again, these are just kind of the real-time imaging of what we actually did. Here, you can see that the prostate on the ultrasound is there. The blue dots are highlighted for the initial resection. We did the second pass, again, getting as deep as we can here. And again, we're doing that whole gland. So we're really resecting the bulk of that prostate. And finally, our third pass is really devoted to the cancer area itself. And again, we're going even wider to really encompass what we call the penumbra or the kind of surrounding tissue, which may contain cancer as well. And at the end of it, like we don't have that picture, you can actually see that the cut on ultrasound actually goes to where we want it to go. So again, it's using real-time technology to visualize our cuts and actually see that where we're resecting where we are. So again, this involves all of that real-time imaging takes advantage of the system. I have confidence in what I did unlike a lot of the other technologies that I'm not really seeing this actually allows me to see in real time. And the post-op recovery, as Dr. Kriteman, said, is really no different. If we wanted to, we could get these patients home the same day, there was absolutely no difference in the patients that we've done so far. And again, from the patient experience, this is attractive, because not only is it potentially treating their cancer, delaying kind of this active surveillance if they ever would progress. But certainly, it's helping with their urinary symptoms as well. So they kind of get the double bang for their buck there. And so again, this has really changed in our view of prostate cancer has been evolving. My mentor was kind of considered one of the godfathers of prostate cancer. And he would always say that, Brian, if there's cancer, we just got to treat it, and we got to do radical surgery or we got to do radiation. We've really got to eliminate that. That has really evolved over the past decade, really thanks to leaders, Dr. Gill et cetera, who have recognized that not all cancer is the same, and about 40% of them that we can really continue to watch, safely monitor on active surveillance. There has been this gray zone, this 3 plus 4 higher volume, 3 plus 3 that are these patients who are at risk of developing worse tumors over time. And certainly, in this space, focal therapies have really put their mark there. And again, the goal of that is still a little bit unclear of saying, are we delaying active surveillance? Are we totally curing them, et cetera. I would say that the worst case scenario, we're still going to monitor you on active surveillance. So the worst-case scenario is will watch you over time. And if you progress, which hopefully the focal therapy will decrease that risk that we'll treat you at that time. But the best case scenario is that you're totally cured from your cancer. And so ultimately, focal therapy, about 35% of patients will still have untreated disease. That's not that different than if you were just going to monitor them on active surveillance. But certainly, there is over the decade period decreased progression, if you will, on monitoring these patients after focal therapy. Radical treatment itself, which has been the historic has been different, but we have to recognize that even if we treat patients with for prostate cancer, there's always a chance it could come back, okay? So a lot of these patients, even with definitive treatment still have failures. So what we're really trying to do and compete in this space is to say, if we use the AquaBeam system, we can not only resect, do that. We're getting rid of a lot of kind of at-risk, genetically at-risk tissue there. But hopefully, these patients are either completely treated or certainly delay in their inevitable definitive treatment. So thank you so much. And I'm going to pass this over to [indiscernible].

All right. Thank you, Brian. Hopefully, we can laugh together now and so if you laughing at me with my crazy ideas. But no, it's a great overview of one of our early cases of prostate cancer. And as we get through this, it is a process. It is a learning process as we're developing a new indication. So what I'm going to talk about is kind of the view of the cancer market, specifically in the United States, we'll talk about today. And then I'm going to get into some of the early data that we have that we'll unveil for the first time and end with a fireside chat with Dr. Gill here. So according to the American Society of Cancer, there's a little over 3 million men living with cancer in the United States, with prostate cancer in the United States. While this is a serious disease, the way we've been able to manage it through today's era. It's a relatively low risk of mortality, which is a good thing. And the predominant kind of mode of action is active surveillance until along that journey, a treatment is needed to be taken place. When you dive a little bit deeper into this market, which could be which are applicable to the treatment that Brian talked about earlier, there's about 300,000 new cases diagnosed annually. Of those, about 3/4 are localized disease. What do we mean by localized, is that cancer is retained inside the prostate capsule. Disease that is spread beyond the capsule is not a target, a design target of AquaBeam technology. So localized disease. And then when you look at the risk profile there on the right, you can see that about a 1/4 on high risk, 1/4 on low risk and about 50% are intermediate risk. And so when we look at how this -- here we go, how this kind of spectrum and what the treatment landscape looks like across the top is Dr. Helfand mentioned the Grade Groups. So there's a series of Grade Group based on biopsy, 1 through 5, and that corresponds roughly to low-risk intermediate risk and high risk. Oops, so if you look at the NCCN guidelines across the spectrum here, active surveillance is a common approach when you talk about low and intermediate risk disease. And then you see a small overlap there of radiation and radical prostatectomy. They're in the middle of intermediate. And then when you get to high-risk disease, the radical approaches are typically the only options for those patients. However, if you look at what's done in contemporary practice, so things that are outside of guidelines, obviously, you see active surveillance as a predominant option there. This is where you start to see focal therapies come into play. While they're not in guidelines today, they are a treatment that's available around the country and around the world today. And then you start to see some of the radiation and radical surgeries, definitely lower and lower into the low and intermediate risk categories, and I'll be talking about this with Dr. Gill, here in a moment. So in the end, how are we going to design our technology and our clinical research program is our targets to begin with what will be Grade Group 1 through Grade Group 3. So this is where we're going to be studying in our protocols and the treatment profile. This is not a technology where we're going to aim after the high-risk population out of the gate here. Okay. So our first study, it's called PRCT001. We first conducted a small feasibility study of 5 patients, about 18 months ago. And our first entry point into this was a patient that both had BPH and prostate cancer. You could see the key inclusion on the lower left there. IPSS greater than or equal to 8, Grade Group 1 to 3, PI-RADS 3 to 4, which is a measurement of the MRI lesion that is noted, and PSA value of less than 20. We wanted some control of these patients. And here in a couple of slides, and I will talk about the data from that set of patients. We've subsequently modified this protocol to include up to 125 patients from across 15 global sites with a similar inclusion criteria you see there on the right as we want to gather more and more data. One thing as a backdrop that we want to look at for our first test was how does cancer progress. So when a patient comes in and is diagnosed with prostate cancer and they're put on active surveillance, what happens to this patient. And so generally, as the physicians here will own as there is an MR-visible lesion that is more severe than not have an MRI-visible lesion if that MR-visible lesion increases in its PI-RADS scoring going from 2 to 3 to 4, that increases severity. And then if you've got to go a Grade Group, which is diagnosis from the biopsy, as that number increases from Grade Group 1, 2, 3, 4 and 5, the severity increase there and pushes you more towards a radical treatment based on the location there. So based on a literature search, we looked at what happens to an active surveillance population if you did nothing and you looked at them 6 to 13 months after that. We see some of the MRI lesions actually go away. They're right on that fringe. They could go from a 3 to a 2 which, based on this clinical definition less is rather insignificant. And so about 10% will kind of go away at the 6-month mark. If you look at MRI progression, about 30% of the patients will increase or progress, meaning they're going from PI-RADS 2 to 3 or 3 to 4, et cetera. And then also on biopsy, the Grade Group will progress, 30% to 45% of the patients will go from 2 to 3, 3 to 4 on their Grade Group score. So there is a natural progression, even though it's a journey and they're being monitored by their physicians, the disease isn't stagnant. And now it's how quickly does it progress is what I don't think anybody knows up here, but that is what the world was looking at. When you look at our data from our first 5 patients, we did a 6-month follow-up with a biopsy and an MRI, 100% of the MR-visible lesions were gone. They were resected as Dr. Helfand, when you resect something, obviously, we intend for it to no longer be there, and we proved that with our MRI follow-up at 6 months. Well, so obviously, there was no MRI progression because there was no MRI-visible lesion left, and when we did the repeat biopsy, there was no Grade Group progression either from what they had at baseline. So very pleased with the results. We'll caveat it with it's only a sample size of 5, which is why we're now expanding research. We've increased the PRCT001 study to over 100 patients. And we've also kicked off the first FDA study, which we announced, I think, publicly last fall. This is a single-arm study, 20 patients, 5 sites, 2 of the centers are sitting here with me today. This is for localized prostate cancer only, Grade Group 1 and 2. Now a subtle difference with this one 1 is patients don't have to have obstructive disease or BPH. They can. That's not an exclusion similar to the first study that we've kicked off. So this is what I would say is kind of a cancer first protocol. And then if you have a co BPH that is allowable like the patient that was reviewed earlier today. So when we talk about treatment, the strategy of treatment categories, as Brian touched on, we believe we've created a new category, this receptive category. And you can see here, our strategy is a near to total resection of the prostate. We're not focal, we're not just aiming at the MRI-visible lesion. We are trying to deobstruct as much as we can in the prostate as possible. Our early results are re-reported here. I will say while we've had early results on the safety side of things, we've done tens of thousands of patients resecting the prostate with the waterjet today. And it's a very, very strong safety profile that's been documented. The part that we truly need to research is what we call this failure rate or how efficacious can the product be with minimizing or disrupting or stopping the progression of prostate cancer. So in closing, this is a near the whole [indiscernible] treatment that we are embarking on with our technology. There's approximately 3 million men in the United States living with prostate cancer. At this time, we have 2 active studies. Our technology and our treatment goals are to stop or delay the progression of cancer in low and intermediate risk patients, reduce the risk of unnecessary morbidity, and we're going to talk a little bit more about this with Dr. Gill here in a moment. And then overall, offer a safe and effective treatment for prostate cancer for the men that would be applicable to the disease state that we're talking about. So at this point, I'm going to turn it over. I think we're going to take a pause while we rearranged the room a little bit, and then Dr. Gill and I will start our chat. Thank you. [Break]

All right. Well, thank you. Thank you, Dr. Gill. I'll give you a moment here to do a quick intro on yourself, and we'll bring up the disclosure side, and then we'll jump into our series of questions. So I'll have to share 30, 60 seconds about your background and how are we sitting here talking about prostate cancer.

Well, I mean, that's what I do for a living. I'm at the University of Southern California in Los Angeles. I have no financial disclosures, no conflict of interest with PROCEPT. But I'm passionate about prostate cancer. And till date, I guess we'll get into the specifics of things, but men need a treatment option that currently does not exist, and there is a need for it. And I'm excited that potential exists for PROCEPT to be able to address that.

Okay. Well, thank you. So let's jump into this. So kind of let's talk about your career, the surgical approaches you've taken and do you have the tools today to treat prostate cancer? Or what are some of the shortcomings or unmet need that you're experiencing?

Well, I mean, as already alluded to, prostate cancer is the commonest non-skin cancer in men the United States today. And we've been treating men for decades. So we do have the treatment options. However, they are suboptimal. When I started in my -- earlier on in my career, a cancer diagnosis is a death sentence. Basically, it's serious. Cancer equals a problem, cancer equals all hands on deck. It's a war and in war, there is collateral damage, which we accepted. But now with time, as things have gone on, not everything is a nail earlier it used to be. And we just bring out the hammer and his prostate cancer, and we just smashed into oblivion, really not worrying about the collateral damage. Now with time, things have improved very nicely. We are now able to prognosticate in a patient-specific manner such that not every prostate cancer patient is going to have a bad cancer outcome, yet the treatment would give a bad morbidity outcome just because it would [indiscernible] in the neighborhood. And the two principal advances have been: Number one, MRI Ultrasound-guided biopsies where we can now really specifically find the location of the cancer in a more targeted way; and number two, using genomics, et cetera, to be able to better risk ascribe individual patients. So these two put together have really allowed us to become more nuanced for the first time, we are not 100% there yet, but we're getting there, nuance in a more specific way for the individual patient to be able to ascribe the risk and, therefore, they tailor the treatment accordingly. So those advances are very welcome, but the fact remains that today, we just basically have 3 treatment options: active surveillance, radical prostatectomy, and radiation therapy.

No, understood. So why we've had advancements in call it diagnostics. How come the standards have it changed as we sit here today? Because you do hear about other technologies out there, other approaches.

Right. I mean, for things to change, we need high-quality data. We just can't do it -- this is in prostate cancer is a big deal. I mean if we eliminated prostate cancer, from the American Urologic Association meeting, this meeting could be cut down from 3 days to half an afternoon. That's it. I mean the rest of the time, we basically spend talking about prostate cancer. And so to change treatment, we need Level 1 data. Level 1 data being prospective, randomized comparisons. And in prostate cancer, it's notoriously difficult. I mean, there are not too many trials, if literally any that compare established surgical standard of care with a new technology. And so if we need Level 1 data to be able to get into guidelines, the NCCN guidelines, AUA guidelines, SUO guidelines, et cetera, et cetera. And until we get in guidelines, we are not going to have change in practice. It is not going to resonate with all the urologic surgeons and that is appropriate. That's what it should be. And so again, I want to just emphasize that, that Level 1 data is needed to be able to have the treatments catch up with the increased sophistication of our diagnosis that we have today.

Understood. So let's switch gears a little bit to patients. Which patient profiles do you struggle most with in determining their best course of action.

As you showed in a lovely slide, I mean, prostate cancer is basically a continuum. It goes from low risk to intermediate risk to high risk. So while it is a continuum, the treatment options we have are just binary, active surveillance or knock it out of the park, meaning surgery or radiation. While a significant population of patients exists in the middle, which are the gray zone. And for these gray zone folks, they have cancer. I'm quite confident that this cancer is not going to kill them. Yet I don't feel confident enough to do nothing about it. So active surveillance would be a stretch. And I don't really want to go to radical treatment. So this intermediate gray zone is where treatment needs -- attention needs to be focused. And the focal therapy, et cetera, has been one of the ways in which we are trying to address that.

Let's talk about active surveillance for a moment. So I'd say, when you're counseling a patient. How does that conversation go in that ahead of journey as we look at some of the data is 50% to 60% of those men end up with a radical procedure. How does that conversation go with the patient?

So active surveillance is obviously the treatment option of choice for men with low-risk prostate cancer. However, as shown already, active surveillance does not mean you're never going to have treatment. I just want to be crystal clear on that. Somebody who embarks on active surveillance today, we understand and we make sure the patient understands that over the next 5, 10, 15 years, 50% to 60% are going to progress to active treatment. And how do we decide that? We decide that by doing repeated biopsies or MRIs, et cetera, and just a switch from Grade group 1 to Grade Group 2, while it's a small change in the continuum of prostate cancer, yet from a treatment perspective, it's a paradigm shift. Going from active surveillance to radical therapy. And so active surveillance is good for the, and preferred for the low-risk prostate cancer. But as it progresses on to higher-grade risk disease, intermediate risk disease, then active surveillance typically is not optional. And when the switch occurs from active surveillance to radical therapy that's when the morbidities come in, the erectile dysfunction, 80%, I think I'm a pretty good robotic surgeon. We've done over 15,000, 18,000 of these now, yet, yet somebody is doing all those surgeries where men are having a erectile dysfunction. And I'm sure some, many of my patients do. And it's also in the nuanced patient expectation. Earlier it used to be, oh, 1 pad a day is not a big deal. No, it's a big deal. If you are the guy wearing the pad and if your erections are not as good, then it is a big deal.

Understood. Let's talk about where focal therapy fits in these grades on, and let's talk about low-risk, low-risk population than the intermediate-risk population with focal.

So focal therapy for low-risk disease is overtreatment. Because low-risk disease really ought to be just active surveillance monitored carefully. In the low-risk disease is GG1 disease, and focal therapy, some men want it. They are not comfortable with the diagnosis of cancer and then the surgeon saying we need to do nothing. The good news is for low-risk disease, if you do focal therapy, only about 10% of the men will recur, okay, 10%. But when we go to intermediate-risk disease at baseline, and we do focal therapy there, which we currently are doing, the chances of recurrence or progression is up to 50% in-field and out-of-field put together. So focal therapy for low-risk is not that appealing, yet is done. But for the real sweet spot, which is higher aspect of low-risk disease and the intermediate disease in totality is the sweet spot for focal therapy, but the problem there is, in these men, 50% of the cancer is going to stay untreated. I mean tomorrow, for example, there is an abstract being presented, where men who underwent -- who were candidates for focal therapy focus but radical prostatectomy, 53% of the cancers were outside the area that we would have treated with focal therapy. So we need for intermediate-risk disease more than just focal therapy, we need more of a near total therapy, hopefully, without the morbidity that comes with near total...

Yes. I think it's going to be a fascinating paper that's going to be presented tomorrow on the [indiscernible] of the prostatectomy. So let's get your opinions on Aquablation. So now we're kind of looking ahead as this new category, if you will, of a resective procedure with prostate cancer. So now that you've heard Brian talk about, in some cases they've done, USC, you guys have done some of your own prostate cancer cases in the study, share your perspective on where you think this can fit in the treatment paradigm?

So a little bit of a leading question, but I already said that I respect Brain tremendously and the entire PROCEPT team. And I respect them because of their commitment to try and get Level 1 data. But I'm happy to answer that question because I have no conflict of interest. So I think that for the past decade or more, we have been in front of the FDA with various focal therapies. It just has not worked. By that, I mean, approval from FDA, which is essential. So I think that literally for the first time, we have the possibility of being able to ablate or not even ablate but resect prostate cancer without really causing collateral damage. All focal therapies, you name it, all focal therapies are thermal-based, either heat or cold, going up to 90 degrees centigrade or going down minus 40. And any time you apply thermal energy, there is always collateral damage. I'm really excited about the fact that Aquablation is athermal. There is no energy, there's no thermal energy used. So therefore, the collateral damage ought to be lesser, number one. Number two, with ablation, we leave tissue behind. We "kill it" hoping that the technology did what it said it did, of bottom line, we ablate the tissue, we leave it there and let it die over time, and the body reabsorbs that issue. With Aquablation, we are not leaving it in there. It's gone, gone. We are physically removing it like we would with surgery. That's a big deal. And number three, we can now actually get beyond focal and get to near total because the sweet spot would be higher risk, higher volume, higher grade cancer. And we don't want to leave any of this tissue behind. So I think going through the urethra and being able to do it in a near total fashion to get it up to the capsule would be a remarkable capability, which we have not had with any other treatment option. If we were to do cryo, for example, or HIFU, for example, high-intensity focused ultrasound or irreversible electroporation or laser, whatever, to be able to not only ablate, but remove the entire tissue at risk is an impossibility. With Aquablation, we are excited that we can get in through the urethra, and do "radical prostatectomy" but from the inside, maintain it inside the capsule. The neurovascular bundle is just outside it. And since we're doing it a thermally, collateral damage ought to be minimal. And so I think if we can make this happen, guys, I think we will change the surgical treatment paradigm for low and intermediate risk prostate cancer and then see how that goes.

All right. Well, I appreciate the time. Dr. Gill, it's always a pleasure having a conversation with you. And we'll go back to our panel, and we'll start the Q&A session. So thank you.

Sure. Thank you so much.

All right. We'll turn it over to Matt Bacso with the mic.

All right. So we're going to prioritize those that are in the room first. And then I know that there's been a lot of questions that have come through the webcast. So we'll try to get to everybody. But. Okay.

Matt O'Brien, Piper Sandler. Thanks so much for the presentation this morning and the clinicians for your time. Maybe for starters, just on the label that you're going to be pursuing as far as cancer goes. Can you just talk a little bit about what that label might look like? And then do you think that there's an opportunity with these patients to get earlier into the disease cascade versus waiting because it is still an invasive surgery. So just think about that process in terms of talking to these patients into having some kind of intervention like this done.

So I'll take the labeling question, and then I'll turn it over to the surgeon colleagues to talk about the treatment paradigm. So from a labeling point of view, there's a pathway with FDA called the management of cancer or the kind of the treatment of cancer that they've kind of opened up on. So that is the path that we're going to head down with this technology. We'll take more research and trials of development. But the nice thing about this, as we sit here today, cryo is the only one that actually has the word cancer in its label. There are no other technologies out there that have a claim for treatment of cancer. They essentially have what's called a tool claim, meaning that they give the surgeon a tool that they can then use and treat at their own will for the -- for cancer. So we're embarking on what I call is a rather new process and new pathway with FDA. And so yes, it will take some time, but that's the current direction we're heading. And I'll turn it over to -- maybe Brian or Andy to comment on do you think Aquablation can be used in earlier instead of kind of waiting on active [indiscernible]. That's how I interpret the question.

So I think the possibility is definitely there. I think understanding how patients present with cancer is kind of key to that. So it's ironic that when you have men who have urinary, right, they're just kind of a delayed treatment. I'm living this way. It's a slow kind of thing. It's a bothersome, but I can't live like this. But when men hear that they have cancer, the big C word, they're always initially very motivated to go do something about it because it's cancer. And it's actually my job to usually talk these men off of ledge and say, you know what, you're fine, we're going to follow the risk of you going on to develop metastasis or die from this disease, especially low-risk disease is virtually 0. So those are patients who are motivated. Now if we find and have data that would support that if we use Aquablation, especially for men that we see a visible target, and we can certainly delay the outcomes that they would ever progress to definitive therapy. There's totally an opportunity to go there, because these are, again, a very different population motivated population to undergo therapy.

As far as label is concerned, I would just say, I think, logically, it could -- it would comprise low and intermediate risk disease. The entire population, they're low and intermediate, that's about 70% or more of the entire prostate cancer bucket. That does not mean that every guy with low-risk prostate cancer ought to be having Aquablation of course. But that does mean that the option exists and can be talked to with the patient in a responsible, thoughtful way not pushing Aquablation on low-risk folks, absolutely, but having that in reserve as needed. But the label, I think, would be low and intermediate risk disease.