Streamex Corp. (STEX) Earnings Call Transcript & Summary

Our next presenter is Westport, Connecticut-based BioSig Technologies, a medical technology company commercializing a proprietary biomedical signal processing platform designed to improve signal fidelity and uncover the full range of ECG and intracardiac signals. Please join me in welcoming BioSig Technologies.

Good morning, everyone, and thank you for attending our presentation. It's an honor to present at the LD Virtual Conference. We've been an LD presenter for many years, surviving fires in Los Angeles, COVID and many other challenges. But it's great to have you all, and thank you. We are going to highlight our disclaimer to everybody. You can read it and make note of it. BioSig Technologies is a medical device company. We're based in Westport, Connecticut. Our company is developing -- or has developed a medical technology platform that serves the multibillion-dollar electrophysiology market. That market is a double-digit secular growth market growing quite rapidly, 13% a year, based on the growth of atrial fibrillation or irregular heartbeats. It's one of the largest disease states in the United States and around the world. We have a very differentiated value proposition in our technology, taken us many years to develop. We are currently rolling that technology out to early adopters, and we'll talk about that in a minute. Back in March of this year, as many of you know, we jumped into the antiviral therapeutic area and bringing a medication forward to treat COVID-19. Our FDA-cleared technology has a bright commercial future ahead of it, we'll talk about that. And BioSig has fully protected our medical technology as well as our ViralClear pharmaceutical assets. The team that we have at BioSig, albeit small, we're less than 50 professionals, are very expert in their respective fields. Our management team comes from some of the biggest companies in the medical world, from Celgene to Johnson & Johnson, Medtronic to Boston Scientific. So we have a lot of expert leaders in the organization working at a very high level. We are doing daily patient cases with our PURE EP technology at 2 high-volume centers, and soon to be more, which we'll talk about. We have a robust U.S.-based supply chain. We manufacture our medical technology in Saint Paul, Minnesota. We've seen little to no disruption in terms of production of units and the building of product. We are very active in presenting our technology to our industry. We're presenting in 2020 at 5 leading medical conferences. That's the way medical technology is marketed. And we have been invited to a live showcase which will be taking place in Austin, Texas in the fourth quarter. It would be about 300 customers showing up for that, hopefully. And we announced this morning very important news, that we are unblinding our first human randomized clinical trial on September 15. We will host a conference call at 11:00 and taking any interested parties through the clinical data we've been able to produce. And we will discuss its implications and how it will support our future. Year to date, we've had decent performance as an equity. Our stock is up 27.2%. We've outperformed many of the indexes. Our company has been able to build its balance sheet intelligently by raising $38.3 million of capital to invest in our future growth, both on the device and on the drug side. In terms of our history and the product, many of you are familiar with our product, PURE EP. This is a computerized system that helps electrophysiology surgeons see more information so they can do better procedures. This is what our clinical trial is getting after, differentiating our new technology from what's out there and how it works better. It's a product that the early adopters in the field have spoken very highly about. We're getting some excellent feedback from the users. We have 9 users in Austin, Texas. We have 3 users in Jacksonville, Florida. And I'm happy to say that we have almost uniform acceptance and liability for the product, which is very important in the early days. We're very excited by that, and we expect to have more and more between now and the end of the year. Historically, it's taken us quite a bit of time to develop the technology. We started in Austin, Texas in 2011 with our first prototype, moved the prototype through UCLA and into Mayo Clinic. As many of you know, we signed a partnership with Mayo Clinic in 2017, which we've been able to expand and build off of. Mayo Clinic is leading our ViralClear Phase II clinical trial, which has really been excellent, a great relationship. And it's great to have these medical leaders behind you because it's really impossible to commercialize new medical technology without the support of the leading medical centers in our country. In terms of awareness, there's a lot of good content on our website. For those of you that are new to our story, biosig.com is our website, and we have some excellent videos up on the website of physicians talking about our technology and how they're using it. So you can get an initial understanding from a user perspective. And you'll see more and more from us on this. Almost like -- I hate to put it like golf clubs. If you have the top golfers using your system, or in this case, golf clubs, there's a likelihood that people be interested in the larger markets. So we're building opinion leadership at the top, this is how it's done in our sector. And then we will push down to all the other centers as we roll this technology out. And you can see some of this collateral on our website. In terms of the market size itself. As we said, it's a multibillion dollar market growing at 13.5%, projected to reach $7.4 billion in 2022. In 2017, it was $4.5 billion. The industry is characterized by giants and a few innovators. In fact, one of the innovators went public 2 weeks ago, a company called Acutus Medical, ticker symbol AFIB. I think the stock came public at $16 and is now trading at $32 and has a market cap roughly 4x the size of ours. And we're very comparable to them. So we're happy to see Wall Street making more investments into AFIB and more visibility on the sector. There's a lot of good research now circulating on what the AFIB market looks like. If anybody is interested in seeing any of that, please get in touch with Andy Ballou, who's our Head of Investor Relations. So the U.S. is a very robust growth market. Obviously, COVID has disrupted the U.S. and every industrial sector. With regard to hospitals, believe it or not, AFib happens to be one of the top reimbursement categories in all elective procedures. And the reimbursement rates for AFib for the hospitals have continued to rise at a dramatic rate. So the average reimbursement, if you look on the left-hand side of Slide 9, you see that the reimbursement for inpatient cardiac ablations can be up to $55,000 with commercial insurance, Medicare/Medicaid is paying roughly $23,000. So the hospitals are making real profits on these cases, which means the administrators are basically bringing the AFib market back first over many other elective categories. So there's a lot of money flowing through the hospitals now because of the CARES Act that the federal government pushed through. A lot of our top hospital clients have gotten hundreds of millions of dollars of federal assistance to help them recover financially. And we're seeing a lot of uptick in activity in our sector, which we're working hard to capitalize on. In terms of ViralClear, our drug asset. Many of you are paying careful attention. We started a drug trial approximately 9 weeks ago studying an antiviral drug that ultimately was built by Vertex Pharmaceuticals and licensed by us through Trek Pharma. We are going to be talking quite a bit about ViralClear in the weeks to come. Today, I'm not going to get into specifics, but pay very careful attention in the next days and weeks to come. And you'll start to see us communicating different things to the investment community with regard to the asset. We are looking forward to talking with the FDA about what we're seeing in the Phase II study. And when there's information to share, we will share the top line data with everybody at the same time. The gentleman leading this program is Dr. Jerry Zeldis. Many of you know him as the former Chief Medical Officer of Celgene. Jerry is an extraordinary talent in drug development. He's brought some of the largest drugs in the United States and the world to market, including REVLIMID, which I think is doing about $15 billion of revenues right now for Bristol-Myers. Celgene was one of the most successful drug development companies in history. And we are privileged to watch him in action here at BioSig. And the amount of progress that they've been able to make from a standing start when we started in late March, it's just been remarkable. We've only owned this asset for 5 months, and we're very close to a data readout. And there's a lot of preparatory work inside the company, assuming we're going to go beyond the Phase II. And we'll have more to talk about as far as that goes. I want to remind everybody listening that in vitro, meaning in the preclinical setting, in combination with remdesivir -- our drug asset, merimepodib, in combination with remdesivir was completely effective against COVID-19. So remdesivir, as many of you know, is the only antiviral drug approved for the treatment of COVID-19. And so we're combining with the most widely used therapeutic right now, the only therapeutic that's available in the marketplace. And we think that's a potentially great advantage for us. So there will be more to come on ViralClear in near term. As far as Mayo Clinic goes, Mayo continues to grow with us across the enterprise. Thanks to Dr. Andrew Badley, who's the Head of Infectious Disease and the Head of the Coronavirus Task Force at the Mayo Clinic. We've gotten a lot of benefits that are not visible to those on this call today with regard to our relationship with the FDA, our ability to communicate with certain federal agencies on an active basis. And everybody, including all of you on the call, are waiting for Phase II visibility. If we just optimistically assume Phase II will be good, there's going to be a lot of activity going on with our company, and it will all happen at once. And we have a lot of strength at the leadership level and also on the clinical side. So we're delighted that Mayo Clinic jumped in with us on this drug trial months ago. It served to our benefit. On the drug -- on the medical device side, Mayo continues to help us innovate and push new software forward for PURE EP in new applications. There's a lot of exciting work going on, on artificial intelligence to be built into the PURE EP system. A lot of that work is emanating through our Rochester, Minnesota office, which is on the Mayo Clinic campus. So Mayo continues to be a big value driver for us and will help us create future shareholder value. For the balance of 2020, our goals will be to further expand and announce new installations for PURE EP. There are a whole number of contracts that we're close to announcing. So be patient with us, and you'll see in the near term new centers that are taking PURE EP system in. Those systems will be going in for evaluation, but we'll also have commercial traction as well. We're going to be talking and presenting unblinded clinical data on September 15. And we will be hopefully initiating the Phase III pivotal trial for COVID-19 in the late third or early fourth quarter. We will be developing more of a product pipeline that we'll be ready to share with investors towards the end of the year for PURE EP. We have a lot of software that's been in development for years that will go on top of the PURE EP system. So that's a recurring revenue stream for us. And we're always filing intellectual property. We're up to 27 patents protecting PURE EP and its software. In 2021, we're looking -- assuming COVID is not going to be a menace for the country, we don't know. But if it's not, we're looking to accelerate our commercial activity with PURE EP. We're currently ramping up our hiring of sales and marketing professionals to meet what we believe is the anticipated demand for the PURE EP system. We need more people. We're currently at 8 sales and marketing professionals strong. We'll see a notable increase in that number, and that's tied to fundamental demand in the marketplace. We're not hiring at risk hoping there will be demand. It's the other way around. We're hearing a lot of interest to take the system in, and we need people to be able to go make that happen in the field. We're hopeful to deliver Phase III trial results for the COVID therapy. We haven't yet set a date for that, but we're thinking first half of next year. And as we know more, we'll let you know. We'll be continuing to file IP, and we'll be running more clinical trials for PURE EP to bolster the evidence and the support for the commercialization of the system. The other thing that's moving forward finally, COVID slowed us down, is we're working very hard to get European approval for PURE EP. We haven't talked much about that lately, but we have a scheduled audit in January and February of 2021. Assuming that audit goes well, which we have every expectation it will, we're hopeful we can get CE Mark in 2021, which would set us up for PURE EP commercialization in late '21, early '22. And we're always talking to large companies about partnering opportunities on both sides of the business. And when we have something to report, we will share that with the investment community. Most of you know our management team. I mentioned a lot of these folks come from proven backgrounds in our field in different disciplines that we need. So this is a veteran team. And in summary, we feel we're in good position for the balance of the year. The company has plenty of capital. We recently put in an ATM facility for future use, but we don't have any short-term intended use of that facility. That's for future use. And we're looking forward to intelligently scaling up the organization and hoping 2021 is a breakout year for us. If COVID behaves itself, PURE EP will break out in 2021. if COVID misbehaves, we have COVID drugs that hopefully get through the FDA. So with that said, I'd like to open it up for questions.

Thank you for presenting with us. And our first question is, does the company have any peer reviewed studies?

The answer to that question is we will be discussing that on September 15 for PURE EP. And yes, we have peer review. We just haven't disclosed what it is, but it will -- that will all be disclosed on the 15th of September. Next question?

With so little money -- okay. With so little money into your antiviral, doesn't this equate to a much lower chance of success in trial? Why would someone have offered this for the next -- for next to nothing if there was not -- if it was not highly promising?

I'm not sure how to answer that question. The drug that we acquired, we acquired from a private pharma company. A private pharma company and a race to bring a COVID asset to market needed a public infrastructure with ready access to capital. And without that, that drug wouldn't have moved at all. So we took the drug in on March 25. And within a 5-month period of time, we will have a readout on a Phase II result. That's never been done in the pharma industry history. So that question doesn't make any sense to me. Next question.

Can you tell us any indications on how Phase II of the clinical trials are going?

The trial's progressed very nicely. We'll be communicating with the investment community in the next days and weeks to come. Today, I can't say much until we're ready to basically share the information that everybody's is looking for. Next question?