Profound Medical Corp. (PRN) Earnings Call Transcript & Summary

Before we kick off our program today, let us start by pointing out that this event will include forward-looking statements within the meaning of applicable securities laws in the United States and Canada. All forward-looking statements are based on ProFound's current beliefs, assumptions and expectations and relate to, among other things, expectations regarding the efficacy of the company's treatment technologies, results of future clinical trials, anticipated financial performance, business prospects, strategies, regulatory developments, market acceptance and future commitments. Such statements involve known and unknown risks, uncertainties and other factors that may cause actual results, performance or achievements to be materially different from those implied by such statements. No forward-looking statement can be guaranteed. Listeners are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this Analyst and Investor Day event. Profound undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise, other than as required by law.

Good afternoon, and thank you for joining us. My name is Derek Bower, and I'm the Vice President of Marketing here at Profound Medical. It is our pleasure to welcome you to our 2023 Analyst and Investor Day. This program will feature presentations on TULSA-PRO and its unrivaled flexibility to treat a wide variety of prostate disease patients. You will hear from key opinion leaders in the United States who have gained first-hand experience with the technology. You will also hear testimonials from several prostate disease patients that have undergone the TULSA procedure. Lastly, members of Profound's management team will provide financial, commercial, clinical and corporate updates with a focus on the future of TULSA-PRO. All questions will be held to the end of the program. We encourage you to enter your name and institution into the Q&A area so that you can be called upon to ask your question directly. To kick off our event, we are very excited to share with you in our global audience a short message that demonstrates the impact that our company is making on not only this disease state, but in patients' lives around the world. This video showcases a leap forward, an evolution that patients have demanded. We heard them and we responded. Profound Medical is defining a new category, incision-free surgery. [Presentation]

Derek, thank you. It does really make you think about it from a man's perspective. Good afternoon. My name is Adam Milligan. I'm the Vice President of Business Development. So let's switch gears a bit to the other side of the equation. We have 3 U.S.-based physicians presenting 3 different perspectives regarding their experience with the disease state and with the technology. First, I would like to introduce Dr. Mark Hong. Dr. Hong is a board-certified urologist with integrated urology. He trained at Stanford University School of Medicine, Brigman Women's Hospital and Harvard Medical School. He has fellowship trained in robotic prostatectomy. Dr. Hong, thank you for being here.

Thank you for having me. My name is Dr. Mark Hong. I'm a urologist in Phoenix, Arizona with integrated urology. And today, we're talking about the contemporary management of prostate cancer. If you actually think about prostate cancer as an evolution of therapies, we, of course, have the 2 major treatments for prostate cancer, which have been around for decades. That's namely that or surgery or removal of the prostate, also called prostatectomy and radiation therapy. Radiation of course, involves a different kind of treatment altogether, that's nonsurgical and there's been an evolution on both sides, certainly for us as surgeons. So we started taking out the whole prostate through incision, then we moved to the laparoscopic era and now the robotic era where we take out the prostate through small incisions, but you're still taking out the whole prostate. On the radiation side, there's been some evolution of brachytherapy seats, MRI guidance. But there's a recognition that both of these treatments, while good at curing cancer can cause significant side effects impacts on your quality of life. Therefore, a third option called active surveillance has really become very popular because of the perceived harms of these treatments, surgery or radiation. And let's just be honest, I will say that most guys who are choosing these treatments are not excited about having these treatments done, meaning that nobody that I know in my practice, wants to have a prostatectomy, okay, or even wants to undergo radiation. It's just that they're -- they feel like they're forced to do so because of the nature of their cancer. That's also why they chose active surveillance as they're fearing the complications or the problems that can occur from these treatments. So what you would ideally want to have is a treatment that actually cures the cancer without causing side effects. Really, that would be the holy grail. Well, I can tell you that such a thing actually exists and that's called the TULSA-PRO, which is actually a customizable treatment for prostate cancer. That's also incision-free, but it's also surgical. So it's sort of a one and done and then you move on with your life. We're going to go into specifics. In the robotic era though, I think if we really look honestly at our data and what we've done, we have clearly been good at curing prostate cancer. And this is well published in our literature, the urological literature of what the outcomes are after prostatectomy. On a long-term basis, prostatectomy quite good at curing cancer, but not so good at preserving your continence and erection. So what I mean is being able to not leak urine that's continence and, of course, have an erection enough to perform and that's erectile dysfunction. Well, if you look at the slide here at the -- 2 curves that you'll see, the first one on the left and the one on the right, the one on the left is for incontinence leakage offered, the one on the right is for erections. And of course, if you start on the left side of the graph, you'll see that people start off pretty good, obviously, before surgery. Immediately after surgery, you see a very dramatic worsening of both the continence, the leakage of urine and erections. Now over time, you do see that the function comes back slowly, but you'll see that those curves never get back to where they were before the surgery, both for incontinence and for erectile dysfunction. And by the way, this is the same whether you had it done open or robotically. So I think it's just fair to say from our published literature that the clinical outcomes of prostatectomy surgery have not really improved significantly in the last 30 years. Certainly, in the robotic era, we've achieved significant improvement in blood loss and length of stay in the hospital. But in terms of the things that really matter to patients long term, which is tiering of cancer, but also not wearing a diaper or being able to perform sexually, it's a debate that robotics has really changed that nature. Of course, you should also know that in the robotic era, there have been some safety issues in terms of equipment malfunctioning that have actually led to injury or death. This, of course, it happened to any equipment, but it's also the complexity of the equipment. I personally trained on the very first da vinci robot, and I can personally attest or troubleshoot a piece of equipment, sometimes having lengthy delays in the operating room because of that. So I think it's just fair to say that as a surgeon, you always have to be carefully monitoring the safety of the device in this case, the arching of instruments electrically that can actually lead to a serious internal burn. There's just a lot of things that have to be considered and really the sophistication on the simplicity of the advice really matters. So therefore, what you'd like to have is a surgical treatment that cures cancer but also is quite safe and is reliable and it does not cause the collateral damage that leads to incontinence, erectile dysfunction and other side effects of surgery. Well, that actually is why the TULSA-PRO is emerging as a significant alternative option to those standard surgery or radiation. And that's because it is safe, it's incision-free, there's virtually no blood loss. There's no hospital stay. The actual recovery is fairly minimal because you made no incisions. Therefore, people are back to work fairly quickly. But also, you're able to customize treatment to where the cancer is. You could choose to treat just a small part of the prostate or choose to treat all of it if the cancer requires that. And also, we can treat the entire gland without causing significant side effects of surgery, incontinence or erectile dysfunction. Finally, the MRI guidance of the treatment is quite important. It gives you very accurate information as you treat it. So therefore, you know when you're damaging collateral structures, and therefore, leading to a worse outcome. The MRI thermography, therefore, really matters when it comes to the TULSA-PRO. By the way, you should also know that there's just an advancing pathway of how we diagnose prostate cancer and how we treat it as technology gets better and namely that of we're really using MRI much more than we ever did before. And MRI has incorporated into the diagnostic pathway so that we can actually target biopsies and know what's going on in a much more targeted fashion. By the way, also, you should just know that what happens if cancer is now fully treated with the current methods. For example, with radiation, well-publicized rates of 20% to 40% recurrence after radiation therapy. Well, what do you do in those guys? It actually can be quite dangerous to try to take out of prostate after radiation. Therefore, actually, the TULSA-PRO is a safe and effective way to treat guys who have failed after radiation. Again, on this cancer pathway, you should know that in the past, we, of course, diagnosed prostate cancer through the PSA blood test, which in and of itself is controversial, but getting a PSA, doing a proper [prostate] exam to check for cancer on that. And then, of course, that leads to a biopsy. Even a biopsy in the old pathway is just a bit of a buckshot approach where you're taking multiple samples from all over, but not particularly in a targeted way, therefore, potentially missing cancers. Nowadays, we're, of course, still using PSA blood test and the prostate exam, but we've incorporated multiparametric MRI into that pathway that allows us to see the [prostate]. And if you can see the prostate very well. And if you can see the cancer, you can actually biopsy it and prove what's going on. And there that can then lead to more targeted therapies such as the TULSA-PRO. And this is all backed up with clinical trial data. I want to tell you about one of my patients, a 76-year-old male with a PSA of 14, just so you know, that is definitely not normal. It is quite elevated. But he had already come to me with a diagnosis of what we call clinically insignificant cancer, meaning that it was a tiny spot of cancer found on just one sample on the biopsy. And that's the kind of cancer that likely will never cause a problem in the future. Therefore, rightfully, he was told to be on active surveillance, watch the cancer and not try to do any radical treatment. However, his urination was definitely getting worse, and he had been on medication for that, but he was also trapping quite a year and behind after [EP] because of this BPH or benign prostate enlargement issue. Because of that, we actually treated that, which we did that with a standard BPH treatment, the Greenlight laser and he was quite happy with that. However, we didn't want to lose track of his cancer. So while on Active Surveillance, I actually felt the nodule, again, a potential worsening of the cancer. His PSA, while it had gone down after the laser procedure as we would expect, I ended up getting an MRI and clearly showed something of major concern really on the top portion of the prostate that probably was not going to get sampled very easily with a standard biopsy. Also his PSA density is well elevated. That means that per unit volume of this prostate, it was pumping out more PSA, that was also of concern. So we did an MRI fusion biopsy that called -- it's a targeted biopsy of the areas of concern. And we could clearly see that in the targeted samples in that area that lit up on MRI, as cancer was more aggressive than what we found if we adjusted the standard biopsies from all over the prostate. Now at this point, the patient still had significant concerns about his future continence. Of course, why wouldn't you, I don't want to wear pads in the future and also his erections. Therefore, the traditional methods of treating this, he wasn't that interested in therefore, he underwent a TULSA-PRO procedure. And of course, in this situation, we were fairly aggressive with the area that we could see on the MRI, but we also ended up treating his entire prostate as well. On the slide then, you can see the actual treatment images from this patient, images from the top line are the before images. And then during the treatment are the second and third lines. And then the after images are on the fourth line. And you can kind of just take it from me that there's a big gaping hole in prostate where you see the black space on that fourth line. That means that even before he has woken up from anesthesia, I already know that I treated is cancer. Well, guess what, afterwards, zero incontinence, not wearing pads even from the beginning. He even had erections preserved from the beginning and his first PSA after the TULSA-PRO procedure was at 0.3. Keep in mind, it was 12 before that. Well, I can tell you, over 1.5 years later, I just saw I'm back in my office. He's still doing great, super happy with his results. And in a way, very grateful because his other options had you gone to another urologist would have been prostatectomy or radiation, both options that he did not want to have. By the way, this is another patient in mind, just to kind of illustrate that cancer can grow outside the prostate. And when you start having something suspicious for what we call extraprostatic extension. That means that cancer is creeping and trying to get its way out. Well, by the way, that probably accounts for the publicized rates of about 20% recurrence after prostatectomy. That means that think about this. If you take the whole prostate out, about 1 in 5 guys still have prostate cancer coming back. Well, why would that ever happen if you took the whole thing out. Well, listen, if you have microscopic cancer outside of the prostate beyond where you cut, that's going to grow back over time. Well, you can always imagine that on a TULSA-PRO, we already can see that on the imaging, then we go aggressively in the area and let that be of energy really destroy even the microscopic stuff that's beyond the prostate. So in that kind of situation, you can almost imagine that curates of the TULSA-PRO might actually exceed that of the prostatectomy because you already know that you need to treat aggressively in that area beyond the prostate and by the way, there's new features with the TULSA-PRO for thermal boost that actually will help us treat way beyond the current zone that allows us to get into areas that we want to get into beyond the prostate. I also will illustrate on this particular patient that he had multiple challenges from a hip implant they had placed and some other anatomical issues, we were able to overcome those and cure his cancer without causing him significant side effects. So in conclusion, I can tell you that there's just a sea change happening right now in the field of prostate cancer, both in terms of diagnosis, incorporating MRI, but also then allowing MRI-guided surgical treatments like TULSA-PRO to really become quite prominent. So the paradigm clearly is shifting then. If you're just being told that you should take it out or get radiation or watch it, really, you're not having proper informed consent. You actually should be aware that there actually is a treatment available for you surgically that can cure your cancer without the side effects and actually, that's been well published. We'll also, of course, get results of the CAPTAIN trial. Very exciting to see head-to-head comparison of prostatectomy and TULSA-PRO, but I can already tell you from my own practice what the results are going to be. You're going to see very good results on the cancer side, but much superior results on the incontinence, sexual dysfunction and side effect side. So I thank you for your attention, and I look forward to your questions in the question-and-answer session.

Dr. Hong, Wow, thank you for sharing the true benefits of TULSA-PRO and how it fits into the contemporary treatment of prostate disease. Next, it's my pleasure to introduce my good friend, Dr. Joe Busch. Dr. Busch is a Board-certified radiologist at the Busch center. He trained at the University of Tennessee, U.S. PHS Hospital and Baptist Memorial Hospital. Dr. Busch has over 50 years in diagnostic radiology, has performed over 20,000 prostate MRI scans, over 2,000 MRI in-bore biopsies and is one of the earliest adopters of TULSA-PRO. Dr. Busch, we're so glad you're here with us today.

Hi, I am Dr. Joe Busch, talking to you from the Busch Center, which, as you can see, is a new paradigm in screening, diagnosing and treating prostate cancer using strictly an MRI and incision-free treatment with TULSA-PRO. In our approach with screening, we screen with a noncontrast bio-parametric MRI, relying heavily on the diffusion-weighted imaging, which can actually tell you -- indicate which level of prostate cancer we're dealing with. And then we follow that up with the targeted diagnostic biopsy, which I believe in the future will become more important as genomics enter the scene of the Gleason score. And then this is followed if it's an appropriate case, we'll treat the patient with MRI-guided ablation or with the TULSA-PRO and of course, part of this is IV contrast injection to evaluate the ablation zone. In our experience, this has been our patient distribution, the fact that we are doing what I call near whole gland or prostatectomy type studies and 67% of our cases have been whole gland, 20% less than whole gland but still greater than hemi and then the 13% goes along with maybe 25% to 30% of ablation of the prostate gland. I really feel that that physicians that are doing this for the first time we'll notice a couple of things. They'll notice that there'll be a very interesting increase in accuracy and what they're looking at. So they'll be able to pick up the prostate gland very easily on the first cases. There are differences in the MRIs that are used, but still you're going to see the prostate and the disease and the structure is better with MR than you do with ultrasound. And as you gain experience with this technology, as we have here at the Busch Center, we've optimized our treatment plan to the point that we started branching out with instead of just doing the whole-gland therapy or the neuro gland therapy, we started to attack the apical sphincter. We treated glands that are greater than 90 cc and we've actually done now at least 7 patients who have salvaged radiation therapy failures and also laser failures. We've seen any high [food] failures we've retreated. And it's very exciting. One thing about Profound. I like the idea that we're moving into third-generation robot technology, and they continue to improve the technology. As a physician who first saw TULSA back in 2018, I tell some of my people that it's really changed dramatically, in my opinion, with increasing accuracy and precision. Going back to this Apex, which I'm really interested in is that because no matter what technology you choose to treatment with apical lesions, you have the problem of incontinence because you're down there on the pelvic floor, you're on the external sphincter, you're on the 4 muscles that form pelvic floor and so there's a big problem with urinary incontinence, erectile dysfunction and of course, complications of the procedure, which is usually be a urethral stricture. And at least 1/3 of the patient's usually the cancers are in the Apex. And I think that TULSA-PRO is uniquely suited for this because you can precisely plan around those structures and then you can precisely treat with the high-frequency ultrasound ablator. And at the same time, we're cooling the urethra, and we're cooling the rectum at the same time. And you have very good immediate feedback of exactly where you're treating the patient. Again, at the apex this is a nice example of how I draw out the apical lesion, looking at all the structures around the apex here's the cancer right here. We're one of the first ones in the world to use the ADC mapping and the DWI mapping simultaneously with the traditional T2 mapping of the cancer and then you can see how we treated this cancer with very tight margins and very -- a lot of precision avoiding ablation of the muscular structures and avoiding ablation of the majority of the sphincter. In my opinion, there's no other technology that can do at this time. Again, at the Apex, we have a paper which has been accepted for presentation at the international meeting coming up in Chicago in November of 2023. This is going to be the paper that is presented. As you can see, there's a lot of data on this. But the bottom line is, in my opinion, I've got nobody on diapers and nobody on pads. We're maintaining 82% erection sufficiency and again, 4.8% required intervention for urinary retention. That's 2 patients. And of course, excellent results with only 2 patients requiring retreatment. It's very interesting about this retreatment business. I've now retreated 8 TULSA patients. They're not all my patients, only 4 of them are my patients. But they all demanded to be retreated with TULSA. They didn't want anything else. They thought that the first TULSA treatment was so smooth, so fast. They were all still dry. They were still getting erections, they wanted to repeat the process, all the more reason for the insurance industry to start taking a hard look at this technology because it's going to play a bigger role than just the initial treatment. I think it's going to be a very key technology for retreatment of disease from other procedures. BPH, we attempted to start doing this -- these large glands [indiscernible] glands of 90 ccs. We have done this. You can see 34 patients with BPH, all the glands were 90 ccs. A normal gland is 30 to 40. So these glands are all twice normal. And of course, we even treated a beautiful case that was at 275 that gentleman got excellent results. I'm very proud of the fact in this group, plus 2 additional patients have now gotten 7 patients off of catheters. In other words, they came to me wearing a catheter from anywhere from 2 months to 6 months. I actually have one patient that was a BPH patient that was catheterizing himself for 7 years. He is now 5 months post TULSA and he's peeing normally. He's not had to use any catheters whatsoever. And as you can see on this treatment that we're showing here on these BPH patients, we have the ability to spare the ejaculatory duct. In cancer patients, I feel a little bit differently there's too much of a chance if the cancer is that close to the ejaculatory duct, I don't believe that should be spared. So in conclusion, I see this technology as excellent oncological control similar to surgery, similar to radiation only with a lot less complications, a lot less pain and discomfort and morbidity for the patient. I think that the MRI to begin with is the accurate way to stage. I think most good physicians will not operate or radiate without having an excellent MR to see where they're going and what they're doing so that you can accurately see where the sphincter is, where the the nerves, the bladder neck and the capsule are. And what is the relationship? In other words, when you're dealing with cancer of the prostate, it is location, location, location. What structures is it near that [indiscernible] on the patient. TULSA can save these structures. And I think we've clearly shown that in our practice. I think all patients seeking treatment for organ-confined disease regardless of the grade and I plan on publishing what I've done with the Gleason 8 and the Gleason 9 should consider TULSA therapy because I think you're going to get the same results, you will not have to deal with hormone deprivation and all of the complications of other procedures. So I think TULSA is going to end of the mainstream. It just takes time for people to see this. In my experience, my urologists that have worked with me really see the difference in this technology. And it's all because we're using the MRI, which is -- has a lot of advantages for temperature control and also accuracy in the anatomy and the physiology of what's going on in the gland and the structures around the gland. And I guess with more and more experience is what's happened with us, you can broaden your uses of TULSA technology I look forward to even advancing the field even more with the new improvements that the Profound Corporation has made with this technology. I thank you for this time, and I look forward to answering any questions in the future, if necessary. Thank you.

Really great stuff, Dr. Busch. Thank you for sharing your experience with TULSA-PRO and how you've integrated it into your practice. Now it is my pleasure to introduce Dr. Kelly Stratton. Dr. Stratton is a fellowship trained urologist in the University of Oklahoma Health System. He trained at Oklahoma University, Vanderbilt and Memorial Sloan Kettering. Dr. Stratton has experience in robotic prostatectomy, MR-fusion biopsy, HIFU and cryoablation. Dr. Stratton, it's so good to have you here.

Thank you for that introduction. I am Kelly Stratton and I'm a urologist as mentioned, and I'll be talking about a urologist administered TULSA-PRO program, my adoption and then also my learning curve. I treat patients here at the University of Oklahoma, where I'm an Assistant Professor of Urologic Oncology, and I work at the Stephenson Cancer Center. So just to give a little bit of background of my personal experience, I really started by trying to move into focal therapy as a way to offer patients a minimally invasive treatment for their prostate cancer. And thankfully, I have had this opportunity to expand my practice into TULSA-PRO. There are many reasons for this, and it can be thought of as a shift to incision-free surgery because as a urologist, I am a surgeon, and one of the things that I've offered many patients would be prostate removal. The problem with prostate removal is the impact on quality of life and this is very detrimental to men who experience urinary incontinence or changes in erection. The benefits to TULSA is that we can offer a treatment that's ablative in nature and focal in the ability to provide treatment, but it's to a much broader spectrum of patients. So in reality, TULSA is not a focal-only procedure, and that's a huge advantage. So in my practice, I treat patients, as I mentioned, with prostatectomy, but also with things like cryotherapy or HIFU. And typically, we think of cryotherapy or HIFU as just focal treatments where we see an MRI lesion and we're going to target them with either destructive thermal injury like cryotherapy or an ablative treatment like HIFU. But there are many patients who don't really have just one area or they have areas on both sides or they have areas next to critical structures like the neurovascular bundles. And that's the real advantage to TULSA is that we can customize that treatment to the patient disease and not try and fit this ablative treatment on to what the patient has. In particular, my enthusiasm for TULSA was really led by patients who came to me asking and wanting incision-free surgery that maintain quality of life. And so really, the patients really push me into this as something that I can expand as an option for them. When you think of TULSA-PRO and you compare it to other treatments in particular radical prostatectomy, TULSA-PRO has a much less risk of urinary or sexual complications. Again, it has that broader ability to treat than HIFU or cryotherapy. You can really tailor the treatment to the entire prostate and not have to focus on just one area or an index lesion. The other nice thing is that during the treatment, you have continuous monitoring of your treatment delivery and also the impact of the treatment, which is completely unique to the ablative approaches. With HIFU and cryotherapy, there's really nothing that tells you that you've achieved a successful treatment until the patient has recovered and you've seen them [later] down the road. So when we think of our learning curve, if you consider robotic surgery is kind of the historical learning curve surgery, it really takes many, many cases to develop competency. Some people even say hundreds of cases. And it's true that many residents get those number of cases, but when you think of transitioning from robotic training to a robotic practice, it does take a high volume of surgeries in order to maintain that competency and really have expertise in doing robotic prostatectomy. There's also limitations to access to the robot. And so something like TULSA-PRO may provide a new opportunity for urologists in that the delivery of the treatment can be achieved at a very proficient level with much less experience. The confidence in your delivery is really indicated by the imaging and the thermometry, which happens in real time. You can certainly start in the sweet spot of patients. We would consider those with low intermediate like Gleason group 2 disease or even those with high-volume Gleason grade group 1 disease and then expand as you become more experienced with TULSA-PRO treatments and you gain more experience with other patients. But again, this thought that you would have to have a large volume of patients in order to gain proficiency is just as not as consistent in the ablative treatment. You can get very good, very quickly. And here's one of our treatments. In fact, I believe this is my first patient and really looking through the treatment planning, each individual imaging slice, you're able to create an individualized and specified treatment region for that area of the prostate. This really helps us control the treatment and allows us to customize the plan. The way that we're looking at the prostate here is very intuitive to anyone who's doing MRI-guided fusion biopsies or monitoring patients who have prostate cancer using MRI. So this is a very familiar workflow to the general urologist who may be doing fusion biopsies or those who are following patients who have prostate cancer with MRI imaging. So really, we're taking what is familiar to the urologist and moving it into treatment planning, ablative treatment like TULSA. Here's a framework for patient selection, looking at that sweet spot of patients. Histologically, those with low intermediate risk disease like grade Group 2 disease, also those with high-volume grade group 1 disease. And then the treatment planning, looking at subtotal versus whole gland. I feel like one of the benefits to TULSA is that I can treat the patient bilaterally and not worry about a decline in quality of life. When you think of patients who undergo focal therapy, really focal therapy is trying to not treat as much of the prostate as possible to prevent the side effects like an impact on quality of life such as erectile dysfunction or urinary control. That really leads untreated gland that can later cause rises in PSA or harbor cancer themselves. So we are now seeing with focal therapy, the limitations over time that men have a great ablation in a small area, but then subsequently have a rise in the PSA or a new area in the contralateral gland and we didn't treat that area. We strategically avoided it to try to avoid side effects. That's really the long-term durability issue with focal therapy. TULSA overcomes that by providing men with a greater degree of treatment and yet still controlling the treatment in a way that prevents the side effect. So we can treat sub total or even whole gland maintain continence, maintain potency. Also, there's a wide spectrum of prostate volume. So whereas some of the ablative treatments have limited prostate volume range, with TULSA, we can expand that to even larger prostates. Obviously, when we're first starting, it's nice to have that middle ground 30 to 50 gram. But as you continue to increase -- increase your experience, you can increase the size of the treatment volume as well. So in conclusion, TULSA-PRO has had some important advantage over prostatectomy. It's incision-free, minimally invasive, is an ablative treatment that preserves quality of life. And it's able to ablate enough of the prostate that we're achieving PSA response levels that are much like having a prostatectomy. The patients who come back to me, their PSA levels are almost 0. In fact, sometimes they're hard to detect. That's very different than our experience with other ablative treatments. And finally, TULSA-PRO, we can customize that treatment to the patient specific anatomy. In fact, we can change it throughout the prostate so that we're ablating exactly the areas that we want to. Many urologists, even general urologists, routinely perform fusion biopsies. So the technology of TULSA-PRO meshes with and is familiar to these urologists who are [indiscernible] times looking at MRIs and doing targeted biopsies. The operative experience is the same as the clinic experience with an MRI. And so the need to create this long training program is not as concerning when patients -- when surgeons are undergoing TULSA training because we do this routinely for many different patients. The procedure time is also comparable to having a prostatectomy and in some cases, it's even faster. So in my experience, we were able to get it under 3 hours within my first 5 cases. And then the learning time is short, I see patients every day who have prostate MRI. TULSA-PRO works off of that same imaging in the same way. And so the familiarity with that anatomy in that view and tailoring the treatment and what I see in clinic is a great way to really expedite the training for Tulsa. So literally, I can sit in clinic, show patients, their MRI and describe to them exactly where we're going to ablate their prostate, and I can take that directly into the operating room, do that for patients with MRI guidance, continuous monitoring of the treatment and assurance at the end of the surgery, that, hey, we ablated exactly what we had discussed in clinic. The treatment was a success. We expect your PSA to go down, and we expect you won't need any other treatment in the future. So in conclusion, I think that TULSA is going to be a bridge in the gap between focal therapy and radical prostatectomy. That's going to take urologist to the next level as far as offering whole gland or nearly whole gland treatment that's ablative that offers complete cancer control and offers preservation of urinary and sexual function. Thank you for the opportunity to talk to you about my experience with TULSA-PRO. That was awesome.

Thank you, Dr. Stratton, for providing your insight and experience into what it's like for a new user to adopt TULSA-PRO and we look forward to the continued partnership. Truly great perspectives from each of the physicians that presented today. The work, the hours, the commitment is all about our patients. At Profound, we are not only dedicated to commercializing the best product and treatment, but we are dedicated to the positive impact this has on patients around the world. Please join us over the next few minutes to hear from 3 patients as they share their story from diagnosis through treatment and recovery and the impact it has made on their lives. [Presentation]

Wow, just such very impactful stories. We want to thank you, Bob, Don, Tommy and Autumn as well as your families for courageously sharing your stories with us truly a moment to pause and realize the impact that TULSA-PRO is having to bring that impact to more men, it is important to have partners that drive the mission forward. So we will now hear from a few of our partners in this endeavor. Sally from Philips, Elisa from Siemens and lastly, Dr. Robert Princenthal, AKA MRI Bob from RadNet. Of special note, GE is also a valued partner and represents approximately 25% of our installed base as they're a publicly traded company and in a quiet period, they are unable to join us today.

Hello, everyone. This is Sally Ling. Head of Product Management for systems and solutions of MR businesses in Philips. Today, I'm very happy to be here and talk about how Philips team up with Profound to improve the lives of prostate cancer patients. First, it's important for us to recognize that the purpose of Philips is to improve people's health and well-being through meaningful innovation, and we have set an ambitious target to improve the lives of 2.5 billion people per year by 2030. When it comes to prostate cancer, it is one of the top strategic clinical program that we focus on with 1 in 6 men in U.S. and Europe are diagnosed with prostate cancer and about 1 million more new cases each year, the demand to have proper prostate cancer diagnosis, treatment and palliative care is becoming ever more pressing. Of course, with the technology advancements in place, the picture is [indiscernible]. About 70% of prostate cancer cases were diagnosed at a localized stage where MR guided ultrasound ablation treatment can really bring value. And the majority of patients have more than 80% survival rate after 5 years of diagnosis. With the higher occurrence and growth rate in mind that what I just mentioned, the prostate cancer care is bringing heavy financial burden to the U.S. health systems. In the Philips, we take a holistic approach towards prostate cancer care to address this problem. Here, you can see that from prevention, screening to diagnosis and staging to therapy and treatment follow-up, Philips has a wide range of solutions to address the need of prostate cancer care. To give you a few examples, we have DynaCAD that provides events visualization for prostate MI analysis, digital pathology to better understand the prostate cancer type, needless to say for MR, the business I'm part of, can be utilized for screening, diagnosis, provide image guidance for therapy and for response assessment and follow-up. And specifically for therapy, we team up with companies like Profound to provide incision-free MR-guided ultrasound ablation for localized prostate cancer, which enables rapid patient recovery and reduce side effect. Philips together with Profound, we team up to deliver a high-quality and high clinical impact solution to prostate cancer care and to improve the lives of our patients. Thank you.

Hi, everyone. My name is Elisa Roccia, I'm the global clinical marketing manager for MR Oncology at Siemens Healthineers. First of all, thank you to Profound for inviting us to participate in this event. Prostate cancer is a topic we all care a lot about. Thinking that one in 8 men will develop this disease in their lifetime is really sad and impressive. But there is a lot of work that we have been doing and that we can do to address this very important health care channels, especially developing MRI technology that can support prostate cancer care from screening to diagnosis, therapy and follow-up. Because there is clear evidence that MRI in the prostate cancer patient pathway can really bring clinical value. At Siemens Healthineers, we offer a comprehensive portfolio of MRI systems that can really serve a global market, starting from first-time users up to advanced researchers and we have prostates covered at every field strength. Now with the increased availability of MR systems and we've increased request for prostate MR exams, there are some challenges that we need to address. For example, the need for shorter scans lots and increased throughput. Here, artificial intelligence can help solutions like deep learning, inventory construction can really help to deliver high-quality MR images with a greatly reduced acquisition time. For example, what we see now on the slide, it's our standard multi-parametric prostate MR exam that takes about 15 minutes. Now if we use deep learning reconstruction for this case, the scan time goes down to 8 minutes. What this means is that we can have a full multi-parametric prostate MR exams that fits into a 15-minute slot, which can be seamlessly integrated into routine workflow. Now with the increased number of MRI scans, this comes hand-in-hand with also an increased workload in reading and interpretation of these exams. And again, here, artificial intelligence can come and help. Solutions for AI-based lesion detection and classification can help to speed up the reading times, but also reducing the variability between readers. And the modalities can use this information coming from these tools to communicate with clinicians and support diagnosis and therapy decisions. Indeed, we know that for prostate cancer, there are a number of treatment options that are available and is extremely important to find the right solutions, the right treatment for each patient. And here again, MRI plays a pivotal role. For example, in radiation therapy, in radiation therapy, MRI can play a very important role in planning, but also to add valuable information about the tissue and the tumor biology. And in the recent years, there have been several success stories that have shown how MRI can be integrated into the MRI radiotherapy planning workshop. For example, in radiation therapy. MRI can play a very important all in planning the therapy but also to add valuable information about the tumor biology. In the past years, there have been several success stories that have shown how MRI can be integrated into the radiotherapy workflow. But let's take ablative therapy now. Profound TULSA-PRO solution brought ablation therapy to a whole new level. Indeed, it delivers very specific advantages for certain patient groups. For example, for those patients who are not eligible for radiation therapy and Profound TULSA-PRO solution and MR [indiscernible] control can really individualize the therapy delivery for each individual patient, which greatly improves treatment outcomes. We are very proud to have been partners with Profound since 2016 and and that this great partnership continues strong to constantly deliver advanced therapy for prostate cancer patients. Thank you very.

Hello. I'm Dr. Robert Princenthal. I'm a board-certified radiologist who's been in practice for more than 30 years and I'm currently the Medical Director for RadNet's prostate imaging program. I attended medical school at Penn State College of Medicine in Hershey, Pennsylvania. I did my internship at Hartford Hospital in Connecticut. I did a full diagnostic radiology residency at Yale University and did a fellowship in body imaging and interventional radiology at the University of California, San Diego. I'm proud to be part of RadNet, leading radiology forward RadNet is one of the largest outpatient operators of imaging centers with over 290 centers across the country. I'm happy to talk about men's health and how imaging can really assist men for appropriate detection of prostate cancer. There's a lot of controversy about the role of PSA screening. And because of that, the United States Preventative Task Force guidelines in 2008 recommended that PSA screening shouldn't be done. And the challenge was prostate was the only organ in the body where targeted biopsies didn't exist. So any time a man had a PSA of greater than 4, the urologists would stick 12 needles into the gland with poor guidance and they would either miss a cancer, which would be up here they would find an incidental baby cancer that didn't need to be treated and missed the killer cancer or they would get a low-grade cancer and miss grade the higher Gleason score or the more significant cancer. So now how can we improve PSA screening. Radiogenomics, which is integrating liquid biomarkers, imaging tools and cancer genetic profiling as the future precision care for prostate cancer. We need to do better. And now with the role of MRI, we can triage men who would benefit from a biopsy and we can reduce a significant number of men to avoid a biopsy and reduce the harms. So there was a false negative biopsy rate with the standard old way of 26%. MR only has an 11% false negative rate, but now we can really improve the benefit of biopsy find more clinically significant cancers with fewer needles and fewer harms. Where we're going with this is we want to utilize faster MR techniques, and RadNet is leading the field and creating a mammogram, which is a low-cost 10-minute screening exam without IV contrast in conjunction with RadNet's artificial intelligence program with Quantum to allow us to most accurately identify men at risk for prostate cancer. This allows men to have targeted biopsy and accurate pathology correlation, which then opens the role for incision-free treatment with TULSA-PRO and we need to use genomics to figure out which men may have a higher risk factor. Women have been a much greater advocate for their own health care. In the 50s and 60s, there is no mammography and a woman would present to their surgeon with a big breast mass and they would have a radical mastectomy without image guidance, there was complications of lymphedema, but finally, as women pushed imaging and doctors to evolve, we have mammography, we have needle biopsies, and now we have breast conservation. We can do the same benefit for men at risk for prostate cancer. The pathway should be PSA screening, prostate MR, targeted biopsy. And then for about 1/3 of men, they would be candidates for less invasive treatment rather than surgery or radiation. And this opens the door for targeted therapy with TULSA-PRO, which allows men to be treated and ablate their cancer with very minimum side effects of erectile function and bladder control. So RadNet is proud to be working with our partner, TULSA. We want to have a comprehensive radiology solution. We want to have multiple TULSA centers to provide this at all of our locations with our urology partners and we believe that radiology and urology working together will allow a greater access of this exciting technology to men moving forward. So we're very excited and pleased to be working with TULSA. We feel they're the leader in ablative energies. And in our experience, we've had excellent results and excellent outcomes. Thank you very much.

To all of our partners, thank you. It is now our privilege to introduce the rest of our management team. Today, you will hear from our Chief Financial Officer, Rashed Dewan, Chief Commercial Officer, Abbey Goodman; Senior Vice President, Product Leader, Matthew Burtnyk; and our Chief Executive Officer, Arun Menawat. Rashed, the floor is yours.

Good afternoon. I'm Rashed Dewan, CFO of Profound Medical. Over the next few minutes, I'll provide you with a business update from the finance perspective. To start with, I want to provide you with the opportunity side for Profound Medical. As you have heard from the physicians with the flexibility of the technology and a variety of patients that could be treated with TULSA-PRO, we believe TULSA-PRO could be used to treat 600,000 patients per year who are diagnosed with prostate cancer and hybrid BPH in the U.S. With the ASP up [ $8000 ], the total addressable market for Profound in the U.S. is $4.8 billion. So how are we addressing this market? In the U.S., we have deployed a very efficient business model. . We do not charge any upfront capital cost to our customer. We place our capital equipment at the customer site for free, we charge the customer $8,000 approximately par patient procedure. The price includes the treatment kit, the right to use the capital equipment, Genius services, treatment support, hardware warranty and software upgrade. The model is very efficient for both the customer and profile. From customer side, they do not have to invest a significant capital upfront, which also reduces their per patient cost. From Profound side, it reduces the entry barrier, but at the same time, with our engagement through the Genius Support Services to deliver the best outcome for our patients. Our cost of the capital is about $50,000 to $60,000. We recovered the cost over the 12 to 15 procedures. We only place to the customer side, the capital equipment who has visibility of that kind of volume. In fact, we have recovered or on the way to recover most of our capital placement cost in the near-term. Even though the customer does not have to pay any upfront capital cost for TULSA, they do have some cost commitment to implement the TULSA program. The MRI compatible anesthesia machine is a requirement. Most hospitals has it. But if they don't, the cost of acquiring some machine is about $75,000. There could be a possible MRI software upgrade that will be required. Most of the hospitals have service agreement with their MRI vendors, which includes the software upgrade, but if they don't, the cost could be upward of $50,000. There needs to be a minor modification to MRI cage which allows the TULSA-PRO to connect to the MRI. The cost is between $5,000 to $10,000. With this kind of a cost commitment, it gives us the comfort that the customers are as committed to the TULSA-PRO program as we are. In this slide, we are showing you what we have done so far and the progress we made. As you can see from the bar graph on the left, we have continuously added more and more sites to the TULSA program, and we are working hard to achieve the 50 sites by end of the year. Our recurring revenue is also progressing well. As you can see over the last 3 quarters, consecutively, on average, we have grown over 15%. Most of our revenues are going to be tilting towards recurring revenue in the future as the OUS market is also implementing the recurring revenue model. Over time, we expect the majority of our revenue will be recurring revenue. With a lot of focus on the cost containment and the cost down, along with the manufacturing efficiency, we have stabilized our gross margin above 60%, which is visible in the gross margin chart. As you can see, also with all the increased focus in our operation, we have built in additional capacity and also stabilized our inventory level at around $8 million. We expect, as the volume increases over the near-term, we are confident we should be able to use existing capacity and the inventory to fulfill those without a significant investment. In my last slide, I want to show you how we are utilizing the cash part. As you can see from the G&A slide that we have been continuously cutting the cost and stabilized around $2 million in the last 3 quarters. We are and we'll continuously invest in selling and distribution and strategically invest in R&D. Profound Medical is committed to innovation and we will continue to invest in R&D and clinical to add new features and enhance our offering. Some of them, you'll hear about it today, and some of them will come in the future. With that, I will turn the podium over to Abbey Goodman, Chief Commercial Officer, to discuss our commercial activities. Thank you.

Thank you, Rashed. And it's nice to be here. So I'm going to talk to you guys about our commercial strategy and what we're doing to see and believe why TULSA is the next mainstream technology. The evolution is here. We are demonstrating our recurring revenue business model, our strategy within the sales channels. including our Genius Services strategy, our reimbursement strategy and our marketing strategy. We've achieved many milestones to date, and we're looking forward to many more. The momentum is continuing to create significant value for our partners and our patients that are demanding access to TULSA-PRO. Our initial approach was to focus on leading hospitals. And today, we have some of the most impactful cancer programs as TULSA Partners. With the clinical benefits and results, our partners are choosing to reinvest in TULSA by adding more locations within the U.S. The corporate partnerships that we have like RadNet, like Mayo, will allow the continued adoption and growth of TULSA-PRO across North America. TULSA is giving our partners the confidence they need to treat a variety of prostate diseases, with precision, flexibility and durability. No other established or emerging technology can safely and effectively prescribe treatment plans and treat the disease like we do. So our business model you heard about earlier. We are a pay per procedure, we place the capital equipment, but with that is so much more, we include our clinical Genius Services that provide continuous clinical support and feedback to ensure efficiencies and that we have the best workflow possible at each one of our programs. Additionally, we provide software and hardware updates because we believe every patient and every program should have the latest and greatest. Reimbursement. Today, most patients are cash pay. And a temporary C-code is available to hospitals, C9734. The medicare national average for that payment is a little over $13,000. That C-code reimbursement is 3.6% higher than last year and about 20% higher than any other prostate surgical procedure. But what's coming is our permanent CPT codes. Those were established in June of 2023, and they'll be effective in January 2025. So today, when that C-code is used, our physicians are billing an unlisted C-code. But with this dedicated CPT codes, we will be able to recognize every participant within that procedure. So what are the catalysts, right? People, our organizational design has evolved to focus on driving utilization. And as a result, we recognized the specific skill sets needed to propel the organization forward. We've grown our account management team and our account executive team. The account management team was built to support the growth of our existing partners through continuing education and market access activities. This role has resulted in procedural volume increase, which is reflected in the recurring revenue growth. Our account executive team is growing also with a strong focus on new programs and additionally, the expansion of our corporate partners. We continue to overcome hurdles, find solutions, build out pathways so that we can ensure our partners have a program of the highest quality. Our clinical Genius team, they are a step above and beyond what you would consider clinical support today. Our PhDs, scientists, experts work with every program to ensure that they are the best that they can be. They continue to educate on patient eligibility. They expand disease states, they lead launches of our AI modules, Thermal Boost being the first of those modules, I'm sure some of you know about, and they perform clinical reviews to drive workflow efficiencies. Our channel strategy. Our imaging centers and hospitals have been a focus. Imaging centers have been successful with the cash pay model being supported by independent urologists and [indiscernible], where MR time can more readily be available. Hospitals have been successful with the C-code. Our early adopters started slow and controlled. In the last 6 months, the feedback that we've received is that the results have shown patients are satisfied. They're happy. And the clinical outcomes are as good as, if not better, than our results from our TACT clinical trial. Thereby, the learning curve is established. And as the C-code becomes effective, these sites will be able to come online quicker. Marketing. What we've got here today, what a team. We've seen exponential growth year-over-year in our website presence and average of over 16,000 new users every month and a 295% increase in users visiting find a center. What a great job. So what's changed? What's changed that's going to impact 2024 and into 2025? Well, our CPT codes are one, effective January 2025, targeted with our first publication of our CAPTAIN trial early that year as well. But what we've seen is urology is adopting the contemporary care pathway for prostate disease from screening to diagnosis to treatment and to follow up with MRI. But the patient has also evolved, which means they're demanding a treatment that has also evolved. We've gone from open to minimally invasive to now incision-free. With the Level 1 evidence along with patient demand and quality of life expectations, this will drive more adoption. We'll continue to support the change in that paradigm and focus on our hospitals, which will include top cancer centers, teaching hospitals and community hospitals, along with ASP [indiscernible] and imaging centers. We believe that TULSA is the emerging technology with the potential to become the next mainstream alternative to current treatment options. So where can TULSA be used? Everywhere, because our CPT code will be applicable in all of these locations. There is no other technology that can be used in all of these places of service. We have experience using TULSA within a mobile MRI unit, which can be placed at any of these locations to increase capacity and provide TULSA as a new point of service. So what about the patients? You've heard that it's versatile, but what does that mean? It means 98% of the patients that we've treated today are prostate cancer patients. And of those 15% of those patients have low grade prostate cancer, and BPH, that hybrid patient. About 60% of the ablations are whole gland, providing flexibility to treat subtotal or focal. Prostates treated as small as 20 ccs all the way to 250 ccs. You heard me correctly, 250. There is no other technology that can do that. All grades of disease treated, including high-risk grade group 5 and even palliative patients have been treated. So in conclusion, the evolution is here. We have unstoppable growth in our sales team, number of sites, patient awareness and the patients being treated. The permanent codes are on the horizon. TULSA can be used in all of these locations of services, a variety of patients can be treated aligning with the message that you heard earlier regarding our total addressable market. Our corporate partnerships are strong and aligned. So join us, get on the bus, join us for the evolution. Thank you for the opportunity to be here, and I'm going to turn it over to my peer and my friend, Mathieu Burtnyk, Senior VP.

Thank you, Abbey. The TULSA-PRO combines 3 powerful technologies to provide precision, flexibility and durability like none other. First, real-time MRI guidance for ablation that uses true intraoperative real-time MR images for the most accurate planning and thermometry. Second, transurethral directional thermal ultrasound for heating of the prostate from the inside out. Third, autonomous robotics, and this is really one of the main ingredients of the TULSA secret sauce. Using real-time MRI thermometry, the TULSA-PRO uses a proprietary closed-loop temperature feedback control algorithm to adjust the ultrasound delivery with unrivaled precision. These 3 combined powerful technologies mean the following: precision that matters for better outcomes with the MRI, flexibility from transurethral ultrasound to customize to nearly all patient anatomy and disease and durability from clinical evidence of treatment effects without significant adverse effects. Precision, flexibility and durability means incision-free surgery. Without cutting the skin, surgeons insert catheters into the patient and map out precisely the edges of what they want to ablate, what they want to treat and here in oncology, every millimeter matters. Every pixel matters. This is not just focal therapy. This is customized, targeted treatment tailored to each individual's anatomy and disease, overtreat by millimeter here at a safety margin with a few millimeters there. This is true incision-free customized surgery, in this case, ablating a 44 cc prostate in 38 minutes with no change in urinary or rectal function and prostatectomy like PSA response sustained for years. TULSA has the flexibility to treat all parts of the gland large or small. This is an important because no 2 patients are the same. Prostate cancer can grow in any zone of the prostate. More often, there are multiple areas of the prostate or actually cancer that is completely diffused throughout the prostate. This publication by [indiscernible] show that each posterior, anterior and apical targets were best suited by different technology. But the reality is, is that tumors are large, and can extend from posterolateral corners all the way to the interior or to the apex. And as presented by Dr. Busch, apical tumors pose a significant challenge for all other ablative devices. With TULSA, surgeons can focus on designing the best, most effective and safe treatment plan without having to worry about how to fit their patient's disease into their devices treatment box. The fact that TULSA has the unique customizability to tailor ablation for different types of patients is not just colorful images and diagrams. The TULSA-PRO has validated its flexibility and customizability through high-quality, peer-reviewed clinical publications across a spectrum of prostate disease states. Over the next few slides, I will briefly summarize some of the seminal studies and publications that demonstrate this flexibility. Let's start with what is considered the gold standard of Treat-and-Resect studies. TULSA has provided the most comprehensive set of acute and chronic Treat-and-Resect studies validating the technology. Nearly 40 preclinical canine subjects and 20 clinical patients first underwent treatment with TULSA, followed by radical prostatectomy, either on the same day or at a later time point as long as 3 weeks for clinical patients. This undoubtedly shows the temperature cell kill relationship between the MRI and histology and proves that what you see during the treatment actually happens to the patient at the cellular level. Finally, in the clinical Treat-and-Resect studies, it was demonstrated that the ablative temperatures are indiscriminate of tissue type, benign or malignant or grade of cancer. Complete ablation of all index tumors to the prostate capsule was not only measured on MRI, but was observed and validated on gold standard histology. Whole-gland ablation of prostate cancer in the TACT trial, this is certainly a seminal study with TULSA-PRO forming the FDA pivotal study of a single whole gland TULSA sparing the urethra and apical centre. The TACT pivotal study of TULSA has reached the end of the 5-year follow-up duration, making TACT the largest single study of TULSA reporting long-term outcomes. You've seen this data before, so I won't describe the outcomes in detail, but they demonstrate the durability and stability of efficacy and safety outcomes. Prostate cancer with concurrent BPH is, however, new and we are seeing this as our increasing number of patients in this category seeking treatment with TULSA. In this retrospective clinical service evaluation of lesion target TULSA, individualized ablation plans in prostate cancer patients with or without concurrent BPH are reported. What is impressive here is that in the real-world setting with individualized treatment plans, we actually see outcomes that are better than TACT. Salvage TULSA and men with radiorecurrent prostate cancer in this prospective Phase I/II study, which was expanded to include 40 patients. Here, the investigators perform vigorous screening of these patients using PSMA PET imaging and also use that same imaging technology after the procedure to verify complete eradication of the disease. This patient population with radiorecurrent prostate cancer is a particularly difficult disease state to treat. Surgeons hesitate to perform radical prostatectomies as it will undoubtedly leave the patient with permanent morbidity. With the TULSA-PRO with an inside-out approach to ablation of the prostate, we're able to treat these patients without that significant morbidity as we can see in these astounding results. Now this study I'm really excited about, TULSA for men with BPH and relief of [indiscernible]. This is the first prospective study treating BPH with TULSA, showing safety, effective and durable symptom relief. The study is nearly complete recruitment and has already one year outcomes from the first 16 patients. All measures of efficacy, uroflowmetry and patient quality of life have improved. Specifically, IPSS and IPSS quality of life have both reduced by over 75%. This is better or on par with all other modern BPH surgical procedures. There were no Grade 4 adverse events or higher, no hospital stay and no blood loss, including patients who did not have to discontinue their anticoagulant therapy. Stay tuned for updated outcomes as this study completes enrollment and follow-up on all patients. Finally, the CAPTAIN RCT, the first multicenter Level 1 trial comparing ablative treatment randomized to radical prostatectomy. Other randomized trials have failed to recruit patients, and I'm proud to say that we are successfully recruiting at multiple sites in the United States as well as 2 sites in Canada and 1 in Finland. The study is recruiting because of some very practical components that we've included by design, the 2:1 randomization, the inclusion of high-volume surgery centers, but I wanted to highlight one subtle yet important point. The inclusion criteria or organ-confined intermediate risk Grade Group II and III prostate cancer patients with no limits on prostate or cancer volume. These are real-life prostate cancer patients. Patients that are not only pure focal candidates with limited tumor volume, but real patients with real disease that is often multifocal, bilateral or diffused throughout the gland. Patients would otherwise be surgical candidates. With that, we look forward to expand our participating treatment centers and complete recruitment of the target enrollment. TULSA patient segmentation has been demonstrated by real-world usage of the product as we have heard from our distinguished surgeons today and also vigorously validated through peer-reviewed clinical publications, whether it's localized prostate cancer and intermediate-risk patients,select regroup 4 and 5 patient, select regroup 1 patients, who will likely fail active surveillance for concurrent BPH or even radio recurrent salvage patients. TULSA is becoming mainstream in these disease states due to its unrivaled precision planning and treatment for any prostate. The intraoperative MR imaging fundamentally without any registration errors provides the clearest and most precise view of the prostate, prostate disease, internal structures to the prostate as well as the detailed and intricate important anatomy surrounding the prostate. Real-time thermometry, a direct measure of the temperature [indiscernible] effect is visualized by the surgeon throughout the ablation and has adjusted via autonomous robotics to deliver the most accurate and precise ablation. These features are distinct and exclusive to the TULSA-PRO. Other ablative devices do not have this level of visualization and control of the therapy. These technologies can be appropriate in some patients, but given their technical device characteristics, limiting access to the prostate or volume of ablation, they are typically limited to patients with a particular disease subset, small, unifocal cancers exclusive to a single portion of the prostate. These other ablative devices are not just limited in prostate volume, disease location and tumor burden due to their technical characteristics, they are also limited by clinical evidence. This slide summarizes a review of all prostate ultrasound ablation publications originating from groups in the United States. In the case of whole-gland ablation, it is clear that HIFU has high morbidity. On the other hand, in the case of partial gland ablation in the U.S., real world and FDA studies, we can see that HIFU leaves too much clinically significant disease behind. With TULSA-PRO, I'm proud that we are investing in R&D. We are constantly innovating to expand patient eligibility. And these are innovations that we can provide to our customers in real time without having it to sell to them. Here, I'm showing you just 2 recent examples. The first is a hardware improvement, the [ PS plus ] which we just released this month. This new robotic arm has a number of features with one of them allows an extra degree of freedom of lateral motions where surgeons can use to further customize their ablative treatments. The second here is a software module, Thermal Boost, which Arun will speak to but is a feature which allows surgeons an additional degree of freedom to customize in real-time ablation temperature and more confidently achieve desired thermal margins. Thermal Boost was cleared by the FDA about one month ago, and we have already rolled it out to select centers in the United States with really amazing customer feedback. Here, I have included 2 notes from treating physicians, the first is from Dr. Ghanouni at Stanford. He mentions that Thermal Boost allowed them to obtain the desired treatment margin around the tumor more efficiently. And with this feature, they expect to expand their confidence in patient selection. The second is from Dr. Steiner from WellSpan York Hospital in Pennsylvania. He echoed similar feelings from Dr. Ghanouni and mentioned that this is actually what he calls SAFE technology; S for safety, improved prediction of disease ablation, A for anesthesia time reduction, estimated 30% decrease in procedure time, F for fractional tumor ablation coverage only boost tumor volume and avoid critical structures and finally, E, extended coverage for large brands, which means more patients qualify. In summary, the TULSA-PRO offers incision-free surgery with the unique flexibility to tailor ablation for different types of prostate patients. Through careful device design, combining 3 powerful technologies to first-hand surgeon experience, comprehensive clinical publications, ongoing clinical trials and product innovation that really matters, TULSA is used confidently in a variety of disease states. Surgeons can start with the sweet spot and with experience, expand their confidence and advanced precision to offer TULSA-PRO for very unique and challenging cases. The TULSA-PRO evolution is here. Thank you. Without further ado, I have the pleasure to pass the podium to Dr. Arun Menawat, CEO of Profound.

Thank you so much, Mathieu. And I hope that everyone of you has enjoyed these presentations just as much as I have. So at this point, I feel like we have checked most of the boxes. And the first one, I talk about the unmet need. 5 years ago, when we began talking with urologists, the initial responses that we used to get was, well, when you talk about these side effects, that's some other guy. My outcomes are better, or we would hear, look, the patients just want the robot. The other responses that we would hear used to be, well, urology is never going to do or use an MR, we are surgeons. Well, now that we have produced a technology that has clearly demonstrated significant benefits with respect to side effects and recovery, that message has completely changed. They can actually hardly wait to tell you how many different issues that exist with today's technologies and how much improvement, in fact, TULSA has the potential to provide. And with respect to the MRI, today compared to 5 years ago, when MRI was barely used -- today, about 70% of the patients who are treated with prostate cancer undergo at least one MRI. So MRI is here. And TULSA is here, and that's why the evolution is here. So the second thing I wanted to discuss particularly is the robot. So TULSA-PRO is really autonomous robotics. And some people have framed it as the third-generation robotics. But really, it's not about the robotics. It's really about the value that robotics provides. And I think clearly, with autonomous robotics you have seen, we can now move to the next platform, the next wave where we can think about incision-free procedures, where we can think about no radiation when we can treat patients who may have comorbidities and cannot afford to have blood loss or we can treat patients who cannot be in a hospital, and we can reduce overall cost. So this is real value, and that is the value that Profound's autonomous robotics actually means. And one of the third questions that has come up frequently has been about imaging's role in interventions or surgical procedures. A number of questions have been related to, well, MR is used for diagnostics. What about its use in intervention? The reality is that when we think about reimbursement, the payment is based upon time and the effort or the risk involved with the procedure that is done. So if you look at universally, a payment for a diagnostic imaging versus similar imaging but move to an intervention or surgery, you would typically find significantly higher reimbursement for those procedures. So in fact, even if a hospital or a clinic would have limited MRI, it's better for them to move diagnostics to a lower cost center and really utilize their MR for the higher value technologies such as TULSA-PRO and so these have been some of the early adopter, early -- when you were talking about game-changing technologies, these are some of the things that we had to overcome, and we're really pleased to see that these things are now behind us. Today, as you heard from Mathieu, we have significant clinical data. You heard from Rashed, our TAM is far greater than what we thought when we started. And that's the nature of game-changing technologies, you learn as you go. And you heard from Abbey, we already have leading hospitals using our technology. And by the way, the patients love TULSA. They are already asking about TULSA. And as you know, AMA has already established the CPT codes that will be available as of January 2025. Most of the time, when you were talking about such game-changing technologies, it takes 7, maybe 10 years before a category 1 code is established. We were there in 5 years. And Abbey talked about that we are now building a world-class sales team, and we have already established gross margins and we have a very effective R&D team. This is just an example of the demand that patients are beginning to indicate. A year ago, compared to this last month, we can see a fivefold increase in the number of hits to our tulsaprocedure.com website, which is specifically designed for patients. So Dr. Hong talked about this publication that describes the state-of-the-art today, particularly in prostatectomies. And this publication is really credible because it uses about 1,000 patient population, half of them are robotically done prostatectomies. The other half is open surgeries. And the publication primarily talks about the benefits of robotic surgery, which is lower blood loss and less hospital stay, incrementally better in both of those. But TULSA really, using the same measure, moves to a discretely next level, no blood loss and no hospital stay. But then TULSA is going one step beyond, significantly reducing the risk of side effects and enabling the treatment of a wide variety of patient population. In fact, you can treat [indiscernible], patients with BPH and you can treat patients with cancer. There is no other technology that has such a wide variety. And you get a confirmatory analysis at the end of the procedure, which really helps with the communication with the patients. But the question that I asked our urology community, well, what is the difference between robotic surgery versus non-robotic surgery because when you really look at these charts, really, there is no difference. And from a scientific perspective, what that says is, we're kind of stuck. For the last 40 years, we have 20% redos of repeat surgeries, and we have about 20% incontinence and about 50% erectile dysfunction. So we really haven't changed anything in the last 40 years. Well, that's not good enough. And this is where this whole idea of an MR centric strategy makes a lot of sense. We can do far better screening using MRI. We can do far better diagnosis. We are already now mostly doing MR-guided biopsy and Profound is now completing that image by bringing an MR-guided treatment procedure with TULSA. And certainly, follow-ups can take place. And this is why our TULSA-AI initiative is really critical. And as time goes on, we will continue to describe more and more about why this is a very important initiative for Profound. We have already publicly talked about 2 of these, the contouring assistant, which is with the FDA at this point and in our clinical. And we still continue to expect by the second -- first half of next year that we are anticipating that we will get clearance for this. And then Thermal Boost, which we recently received approval -- clearance and that is already receiving some rave reviews from our early users. So Thermal Boost gives them the ability to really see the margins, guesstimate if they think that there is a problem and be able to really address the margins. Or in some cases, it just gives them confidence that if they see cancer, they can just take care of with some extra blast of energy, have some better assurance that they have actually taken care of the cancer. And when you look at the next one, which is the contouring assistant, which you may have already heard about also, is to be able to use the knowledge of the current procedures of successful patients and be able to use that information and thereby suggest a treatment plan which gives them a new urologists in particular confidence in the treatment designs. And at the same time, it helps them make adjustments to their own liking and thereby, they can get up the learning curve and have the customization, the way they see it the right way. But when you really look at what is our FDA clearance, it is for the ablation of prostate tissue. And in the description, benign and malignant. So we have a broad FDA clearance and we should be able to treat patients who have cancer disease or BPH disease, which is why we are also announcing today that we will have a TULSA for BPH. This will be a takeoff from our automatic contouring assistant. The idea is to be able to very quickly provide a BPA's design that will still be customized to the shape and size of each prostate and it will automatically then present the treatment plan and an ablation protocol and allow physicians to quickly treat patients who may only have BPH. And Mathieu went through some of that data with you and more data, more trials are already underway and more and more data will be coming in the next few months. But this is, again, a very small snippet of the comparison of a small data set for TULSA, but the initial data is actually quite impressive. The IPSS score, the lower the better, and really, TULSA brings the score down to a level of people who are in their mid-30s. And so we are quite excited to be able to expand the potential of TULSA and bring it to the patients who have BPH. And finally, I mentioned to you this idea of 20% redos or such high incontinence and so on is not good enough. And so we will be announcing initiatives where the TULSA-AI will continue to become a learning system, and we will be collecting the data, the databases that you get from all of these different procedures in the current -- in the new patient pathway, which will then allow us to really detect better and thereby ultimately break that barrier of the 20% redos that the industry is actually settled on at the moment. So this is my final presentation, I'm proud of the team. You've seen the team today. And I think you can expect continued involvement as we go forward. And my message to you as you know, what we are doing is really amazing for the patients. It is amazing new technology. It will ultimately help health care in terms of reducing cost of those redos, reducing cost of the total workflow at the same time. So get involved with us. Be part of the change. Thank you. So let's switch to question and answers at this point. And so I'm going to turn it over to our team. We're going to take a very short break and come back for Q&A. Thank you.

[Operator Instructions] Our first question comes from Josh Jennings of TD Cowen. Go ahead and ask the question, Josh. Josh can you unmute and ask the question?

Okay. Josh seems to be having some technical issues. So he e-mailed me the question, so I am going to read it for him, if that's okay. TULSA-PRO appears to be extremely well positioned for the future of MR centric management of prostate disease. Can you talk about where the clinical community is today in terms of progressing to an MR centric approach. Are there centers who have moved forward already? And what steps are required to make an MR centric approach become mainstream?

I think that the concept of this MR centric strategy is definitely resonating everywhere. You heard from our partners that is a strategy for them. You heard from RadNet, our partner at RadNet. They are actually looking forward to this MR centric strategy. They have already started certain programs where they can do early detection with their screening applications and their own AI initiative. So I think that we are in the early innings, we are certainly starting to see that, I would say, a few of these centers have adopted it and are beginning to build these databases. The second point, I wanted to make is that the centric, I think, is definitely the longer-term strategy. But even today, using TULSA as part of the workflow is still going on. And so I think the idea is that the first step towards getting to the MR centric strategy is really getting TULSA to many, many sites. And I think once we get TULSA to many, many sites, then I think moving into these AI initiatives and these MR centric strategies is going to be actually the second step for us. But I would say, certainly, this year, by end of this year, you will begin to see a few of these centers adopting these strategies on a routine basis.

I would just even take that one step further to say we've seen MRI explode from a diagnosis perspective. We're using MRI to guide our biopsies and our evaluation of patients clinically, where the prostate cancer is, then we move that MRI into a focal form of treatment and then TULSA will allow us to move MRI into treating focally or whole gland much the way that we had used prostatectomy or radiation therapy as an option for patients who need a whole-gland strategy. So really, we see TULSA as a way to expand MRI even more into a treatment modality that could be used either focally or in a more broad application.

Thank you, Dr. Stratton. Excellent.

Yes. If I can add something there, just knowing what I see in my community, I think there's a wide variation where I still think we're in our infancy MRI itself has been around for a long time, but you're actually starting to see the rapid adoption in the urology community that I'm still kind of seeing, for example, urologists who are primarily oncology based that are not necessarily getting MRIs or MRI-guided biopsies, so I think we're actually relatively in our infancy and this certainly part of our awareness and guidelines now, but the actual adoption is still yet to come on a larger scale. And just to illustrate this point, I recently saw a patient who had been biopsy by a different urologists for a valuation of TULSA-PRO. And he had an MRI done after the biopsy, which normally is not useful because of the hemorrhage and other things that mask cancer to be seen. But I'm actually bringing up the point because I could actually see where the biopsies had been taking on the standard non-MRI approach. And I can tell you that where the biopsies actually were taken versus what the pathology results said they were taking from. I'm talking about anatomically within the prostate they were widely different. And so it kind of points to how we're still in our infancy. What we think we're biopsying when we do an ultrasound guided biopsy alone may wildly differ in terms of what the actual location of the cancer is. And therefore, that MRI piece is a very crucial part of the technology.

Thank you, Dr. Hong. Steve, let's move to the next.

Our next question comes from Rahul Sarugaser from Raymond James.

Can you hear me, okay?

Yes, Rahul. Go ahead.

Thanks, Arun. To everyone, thank you so much. It's been a great presentation today and excellent to see all the progress specifically in the prostate cancer. My question, however, is going to focus on your announcement today on moving into BPH specifically, which is great to hear because we've always thought that TULSA was very applicable in BPH given its label. So perhaps for the doctors on the call, Dr. Hong and then -- apologies, Kelly, I think your first name. I would be careful to hear your thoughts on the applicability of TULSA for just BPH only patients. And then Arun and team would be grateful to hear about how you plan to leverage the TULSA system in the near term for treatment of BPH-only -- the BPH-only patients?

Yes, I understand the question. My brief comment on that is I definitely see a future for that. As we all know, BPH is much more prevalent and therefore, a treatable state than even prostate cancer for men. The case to the technology will continue to be the same metrics that determine the success of any BPH procedure, whether it's TULSA or otherwise, that is namely that of symptomatic improvement and objective improvement which we know how to measure, Already Arun did show some of those results. I think they will be borne out as I've already seen that in my patients who have been treated for prostate cancer, but also had concurrent BPH. We've seen some pretty dramatic improvement in flow rates and other measures. Now in order for that to be widely adopted, we're going to get even more efficient. Therefore, the AI tools are important, also just being able to have very efficient processes set up so that if it's taking 3 hours to do one BPH patient that clearly doesn't compete with the existing technologies, yet I can definitely tell you that it is possible to use a TULSA to efficiently treat a BPH patient.

Thank you Dr. Hong. Rahul, let me sort of describe a little bit of this. So what we announced today is really the first step that we're taking towards BPH. And as Dr. Hong mentioned, the first idea is to use our AI capability that we have incorporated in the contouring assistant to be able to then design the treatment for BPH. And the value of this is clearly #1, we anticipate, and we've got a lot of work to do, but we anticipate that it will be a much faster way to design -- to do the treatment plan. But at the same time, it will be far more customized to each shape and size of the prostate. And so that capability that we have already built in our company, we're using it to expand as our first step. We're very aware of the fact that we cannot have a 3-hour procedure, even though, to be very honest, when we talk to some of the patients, the time is actually turning out to be less important to them as compared to the durability aspect of this because as you know, our prostates shrink over time. And so as they shrink, it actually theoretically would remove the symptoms for good. And so I think what you will see is sort of an evolution of our BPH strategy, where we're going to use our first AI-based treatment design, which will help us make it faster. And I think that there are certain things. If we do that, we anticipate we will be able to do also in the way we provide the ultrasound -- thermal ultrasound as the heating source. So all together, we think that using the same hardware, we should be able to provide a far more efficient and still maintain that customization capability to do so. And then we're not prepared to talk about beyond that today. But what we are saying is that we are quite serious about entering the BPH space over the long haul.

And sorry, let me just make one. I didn't mean to imply a BPH procedure will routinely take 3 hours with the TULSA-PRO. Actually, if you think about an apples-to-apples comparison, when we do a TURP or a laser TURP, we're not actually trying to remove all the prostate tissue endoscopically. Therefore, if we actually just look at the volume in tissue that we normally would remove with the standard [roto-rooter] TURP and do the same thing on the TULSA-PRO, I can pretty much tell you without a doubt that you can do it under an hour. So I think already the ability and technology exists to be able to do BPH at scale. but of course, the AI tools and other things would be even more helpful.

Thank you. Excellent. Next question, please.

And our next question comes from Frank Takkinen at Lake Street Capital Markets.