Pulse Biosciences - Q4 2023

Transcript

Operator (participant)

Greetings and welcome to the Pulse Biosciences fourth quarter 2023 earnings conference call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Trip Taylor, Investor Relations. Thank you, sir. You may begin.

Trip Taylor (Principal)

Thank you, operator. Before we begin, I would like to inform you that comments and responses to your questions during today's call reflect management's views as of today, March 28, 2024 only, and will include forward-looking statements and opinion statements, including predictions, estimates, plans, expectations, and other similar information. Actual results may differ materially from those expressed or implied as a result of certain risks and uncertainties. These risks and uncertainties are more fully described in our press release issued earlier today and in our filings with the U.S. Securities and Exchange Commission. Our SEC filings can be found on our website or on the SEC's website. Investors are cautioned not to place undue reliance on forward-looking statements. We disclaim any obligation to update or revise these forward-looking statements. We will also discuss certain non-GAAP financial measures.

Disclosures regarding these non-GAAP financial measures, including reconciliations with the most comparable GAAP measures, can be found in the press release. Please note that this conference call will be available for audio replay on our website at pulsebiosciences.com in the news and events section on our Investor Relations page. With that, I would now like to turn the call over to President and Chief Executive Officer Kevin Danahy.

Kevin Danahy (President and CEO)

Thank you, Trip. Good afternoon, everyone, and thank you all for joining us on this call. I am excited to be here today with our team, including Darrin Uecker, Chief Technology Officer and Director, Mitch Levinson, Chief Strategy Officer, and Mike Kaufler, Vice President of Finance. Our accomplishments in 2023 and early this year have been focused on our proprietary, designed, and engineered CellFX nsPFA energy delivery system and the three novel end-effector devices designed to deliver our CellFX nsPFA energy to different tissues in the body. We are pleased with our success. Today, I will highlight each of the three surgical opportunities we are currently focused on at Pulse Biosciences: the CellFX nsPFA percutaneous electrode, the nsPFA surgical clamp, and the nsPFA 360-degree cardiac catheter.

I will then hand the call over to Darrin to provide a detailed product update on our cardiac device programs, and then Mitch will provide specific non-cardiac development progress. Finally, Mike will review our fourth quarter and end-of-year 2023 financial results before I conclude and open the call for a question-and-answer session. First, I want to focus on the CellFX nsPFA percutaneous electrode. The percutaneous electrode, or Perc electrode, is designed for the surgical soft tissue ablation leveraging our proprietary, designed, and engineered CellFX nsPFA energy delivery system. The CellFX nsPFA energy creates potential patient benefit and surgeon value in the treatment of soft tissue nodules. We believe CellFX nsPFA has the potential to provide hospitals and treating physicians with a new and exciting alternative for patients with a broad range of soft tissue nodules in need of therapy.

In November 2023, Dr. Stefano Spiezia, leading thyroid surgeon and Chief of Endocrine Surgery Division at Ospedale del Mare in Naples, Italy, completed our initial trial of 30 patients on the application of CellFX nsPFA percutaneous electrode for the treatment of benign thyroid nodules. He presented his excellent results in February at the 2024 NASIT annual meeting. Additionally, the percutaneous thyroid nodule study will be shared in detail via the podium presentation later this year, demonstrating extremely promising feasibility results. In November 2023, Pulse Biosciences concluded its preclinical studies and submitted a pre-market notification, 510(k), with the U.S. FDA for clearance to commercialize the CellFX nsPFA percutaneous electrode. In March 2024, we received FDA 510(k) clearance for our CellFX nsPFA percutaneous electrode system with a soft tissue ablation indication.

Regarding the CellFX nsPFA surgical clamp, the nsPFA surgical clamp is specifically designed for general ablation of cardiac soft tissue, leveraging our proprietary, designed, and engineered CellFX nsPFA energy delivery system to be used by cardiothoracic surgeons during open or minimally invasive cardiac procedures. Our Chief Medical Officer, Dr. Gan Dunnington, and Chief Science Officer, Dr. Niv Ad, have been instrumental in driving our progress in cardiac device development, preclinical work design, and the FDA application process. In December 2023, we filed a pre-market notification, 510(k), for our CellFX nsPFA cardiac clamp. We believe CellFX nsPFA offers significant potential advantages over current energy modalities in the cardiac surgical space. Lastly, I want to discuss the CellFX nsPFA 360-degree cardiac catheter. The catheter is designed for the use by electrophysiologists to isolate and ablate the pulmonary veins of the left atrium.

We believe our unique and intended design of the CellFX nsPFA cardiac catheter allows physicians the versatility and flexibility in one single design to perform pulmonary vein isolation as well as enable important posterior wall isolation. Multiple key opinion leaders, KOLs, are creating increasing awareness of the benefits of our novel CellFX nsPFA cardiac catheter throughout the clinical community and presenting its potential at prominent medical meetings. Podium presentations and addition of new key opinion leaders are helping us build momentum as we execute on KOL development and clinical plans. Recently, on the podium at the AF Symposium on February 2nd, Dr. Vivek Reddy featured the CellFX nsPFA 360-degree cardiac catheter and showcased the first-in-human cases in a presentation that was well received by Dr. Reddy's colleagues in the audience.

We expect to have a strong presence at the Heart Rhythm Society, HRS, May 16th to May 19th in Boston. We are pleased to report that we have completed 60-day post-procedure evaluations in February 2024, generated from the first in human catheter feasibility study. The very good news is that the remaps look almost identical to the immediate post-procedure maps, which demonstrates the early on-durability of high-quality lesions that our CellFX nsPFA 360-degree cardiac catheters are able to produce. These positive results were well received by all involved, including patients, physicians, and supporting staff. We plan to complete enrollment of our initial first-in-human feasibility study of 30 subjects in the coming months. We also plan to initiate a study to support CE mark filing, which will complement our KOL development in the European markets.

Each of the CellFX nsPFA devices we have discussed has the potential to revolutionize current standards of care in comparison to speed, efficacy, adverse events, and overall treatment outcomes. I will now hand the call off to Darrin to provide updates on our cardiac device development, including progress made in the lab and clinic.

Darrin Uecker (CTO and Director)

Thank you, Kevin. In the fourth quarter and in recent months, we are continuing to make significant progress advancing our cardiac catheter and clamp programs. Data generated from our recent studies have continued to validate our expectations that the differentiated benefits of our CellFX platform and proprietary devices that leverage the novel characteristics of nsPFA technology and the CellFX system positions us to be the next-generation standard of care for the treatment of AF as well as other indications. Let me highlight again the important differences between our nanosecond PFA and existing microsecond PFA technologies.

The higher amplitude and shorter duration of nsPFA energy pulses are uniquely able to penetrate the cell membrane and alter the function of cellular organelles, leading to regulated cell death, rather than immediately destroying cells like most other energy modalities such as standard PFA and thermal modalities like cryo, which uses extreme cold, or radiofrequency ablation, which uses extreme heat. nsPFA delivers about 20 times less energy over time to tissue than standard PFA. Because microsecond PFA delivers so much relative overall energy, these devices tend to operate close to the threshold of time-based thermal injury. So it is necessary to trade off speed, depth of penetration, and the amount of tissue that can be treated at once to ensure safety.

Our early data show that the CellFX nsPFA non-thermal mechanism of action can lead to beneficial outcomes in the clinical setting where physicians do not need to trade efficacy to ensure safety. We are developing CellFX nsPFA cardiac ablation solutions for use in open surgery by cardiothoracic surgeons and for use in the electrophysiology labs by electrophysiologists, making us the only company we're aware of developing nanosecond pulsed field products for both applications. I will first provide progress on our initial cardiac ablation catheter, the CellFX nsPFA 360-degree catheter. This catheter is named 360-degree because it is uniquely engineered to harness nsPFA energy and to perform a 360-degree circumferential ablation in as few as a single nsPFA cycle within as little as five seconds.

In our opinion, the large footprint and unique versatility of this catheter provides a highly differentiated and beneficial solution for EPs performing cardiac ablation for the treatment of atrial fibrillation. As Kevin noted, we are pleased to report that we are currently validating the use of the system and its unique capabilities in our ongoing first-in-human feasibility study. In December, we began enrolling patients in this study, and as of today, we have treated 19 patients of 30 potential patients that the protocol is currently approved for. And in present time, we are encouraged with the performance of the device and the safety profile that is emerging as we treat and follow these patients. Dr. Vivek Reddy, one of the PIs in this study, reported some of the initial data during a presentation in February at the 29th annual AF Symposium 2024 meeting in Boston.

Dr. Reddy presented a video recorded procedure from one of the initial five procedures to the audience at the AF Symposium meeting. A clip from Dr. Reddy's presentation can be viewed on the Pulse Biosciences homepage. The study protocol includes an EP remapping procedure to evaluate the durability of the ablations as compared to the acute map performed at the time of the procedure, and we recently reported on the positive results from the first four patients that have had these remaps. We are looking forward to the presentation of updated data from this study at the prestigious Heart Rhythm Society meeting in Boston in May. The results from this study will inform subsequent trials. In parallel with completing enrollment of our feasibility study, we are also planning future trials in Europe for the CE mark and in the U.S. for FDA approval.

We will provide details of these studies on a timely basis. We believe the strength of our results is attributable to our novel catheter design and the highly differentiated properties of nsPFA. The benefit of our circumferential treatments is that EPs don't need to repeatedly reposition and retreat to connect the dots like they do with other PFA and thermal technologies. In our opinion, the greater depth of our electric field creates reliable transmural lesions, even in thick tissue, further differentiating Pulse Biosciences cardiac catheter products in regard to patient therapeutic value and surgeon ease of use. The clinicians performing the procedures have been impressed with the maneuverability and versatility of the catheter. They have been able to treat the atrial wall in addition to the pulmonary veins.

The fact that they are able to use our catheter to map the atrium has reduced patient procedure time and improved surgeon ease of use. The all-in-one nature of the catheter is an additional differentiating feature that resonates well among the EP community. We intend and believe this procedure will be easier to perform with significantly reduced procedure times, all of which will improve patient safety and overall therapeutic efficacy. As we have described previously, our 360-degree catheter is engineered to integrate with current mapping and navigation systems used in EP labs. The initial first-in-human procedures have validated this capability, and we are continuing to explore the use of these and other systems to demonstrate our system flexibility. We are working with approximately 90% of the installed base for mapping and navigation systems.

Aside from the initial system we used, we have also used the CARTO system from J&J, and we are planning to also use the EnSite system from Abbott. Going forward, we continue to evaluate multiple possibilities and will do what is best for patients and physicians. The awareness of nsPFA continues to grow as presentations by our lead investigator, Dr. Vivek Reddy, are garnering significant interest from the clinical community. Four abstracts were accepted on our catheter technology for the Heart Rhythm Society 2024 meeting in Boston, May 16th through the 19th. We're pleased to see the acceptance of our proprietary design and engineered CellFX nsPFA energy delivery system and for our partners to be given the opportunity to present data from preclinical and clinical studies using our novel devices at this important scientific meeting. Now I will provide an update on our novel proprietary cardiac surgical clamp.

We believe our CellFX nsPFA surgical clamp has the potential to significantly change the way cardiac surgical ablation is done in cardiac surgery. Our preclinical data demonstrate the potential for the clamp to improve safety, effectiveness, ease of use, and treatment speed. The data demonstrate the nsPFA clamp can produce continuous transmural durable lesions in 1.25 seconds, independent of tissue thickness or type, as compared to 15-30 seconds for thermal ablation modalities, which are highly dependent on tissue thickness, type, and vasculature. Due to the non-thermal mechanism of action, the CellFX nsPFA clamp has no risk of thermal damage to collateral tissue, which is a known risk with current thermal technologies. Importantly, shorter treatment times could eliminate the need for on-pump treatments, making it a much more acceptable procedure for cardiac surgeons.

The CellFX nsPFA clamp is designed in a familiar form factor to what is currently being used by cardiac surgeons using radiofrequency ablation, and we expect this familiarity will enable a seamless transition from current radiofrequency ablation devices to our CellFX nsPFA clamp. We are currently planning our first-in-human feasibility clinical study for the CellFX nsPFA surgical clamp and expect to enroll our first trial patients in the middle of the year. Pre-clinical data on the CellFX nsPFA clamp will be presented at two important upcoming scientific meetings. Two abstracts have been accepted for presentation at the American Association for Thoracic Surgery 104th annual meeting in Toronto, April 27th through the 30th.

The data for one of the abstracts generated by Pulse Biosciences will be presented by Dr Gan Dunnington, our Chief Medical Officer, Cardiac Surgery, and the other by the Cardiothoracic Surgery Research Team at Washington University, a research partner of ours led by Dr. Ralph Damiano. Two abstracts have also been accepted to the Heart Rhythm Society 2024 meeting in Boston, both presented by Pulse Biosciences. On the regulatory front, we submitted a 510(k) for the CellFX nsPFA clamp at the end of December.

We recently received an additional information letter from the FDA regarding the submission and had an initial meeting to discuss the letter with the FDA. The meeting was productive, and we expect a follow-up meeting with the FDA to discuss whether additional data will be required. At this point in time, we remain in the 510(k) process and look forward to working through the regulatory process with the FDA in a collaborative manner.

The performance of both our cardiac ablation clamp and catheter have strengthened our confidence that our proprietary designed and engineered CellFX nsPFA energy delivery system is the next generation in PFA technology with the potential to transform the treatment of atrial fibrillation. As Mitch will describe, we believe the CellFX platform has the potential to transform general surgical ablation via the use of our recently cleared percutaneous electrode. Mitch.

Mitch Levinson (Chief Strategy Officer)

Thanks, Darrin. We continue to believe that CellFX nsPFA energy will broaden treatment horizons for many applications with its unique and effective mechanism of action, as Darrin outlined. As Kevin mentioned, we recently received FDA 510(k) clearance for our proprietary CellFX nsPFA percutaneous electrode system for use in the ablation of soft tissue in percutaneous and intraoperative surgical procedures. This clearance represents our entrance into a new set of clinical applications where our technology can improve the standard of care. The CellFX nsPFA percutaneous electrode system consists of a percutaneous needle electrode powered by our proprietary designed and engineered CellFX nsPFA energy delivery system. This percutaneous electrode is intentionally designed for non-cardiac tissue ablation applications. As we have mentioned, we have numerous soft tissue ablation targets in the process of evaluation, one of which is benign soft tissue nodules.

As we previously discussed, the standard of care for benign thyroid nodules is thyroidectomy, removal of part or all of the thyroid gland, which comes with surgical risks, visible scarring, and often lifelong hormone replacement therapy. Thermal ablation using radiofrequency or microwave are other treatment options but carry with them the risks of collateral thermal damage to nerves, vessels, the esophagus, trachea, and skin. For these reasons, many patients with unwanted benign soft tissue nodules forgo surgery or thermal ablation and simply choose to live with the condition. We believe Pulse Biosciences nsPFA technology can potentially bridge the watchful waiting gap and potentially service these unmet needs. We've completed enrollment of 30 patients in our Italian study of patients with benign thyroid tumors with our nsPFA percutaneous electrode using ultrasound guidance. The procedures we performed appear to be comfortable for patients with little or no reported post-procedural pain or swelling.

We are continuing to conduct patient follow-ups at 90, 180, and 360-day time points following the procedure. Initial procedure results are extremely encouraging. Treated tissue was rapidly resorbed in just weeks after treatment with no evidence of thermal damage or residual scar in the treated areas at 30 days and all the way out to 180 days post-treatment. As noted, our principal investigator, Dr. Stefano Spiezia, plans to provide a readout of the latest data at an upcoming scientific meeting later this year. The increasing evidence indicates CellFX nsPFA energy is an extremely promising alternative to surgery or thermal ablation modalities like RF or microwave. At the 2024 NASIT annual meeting in February, Dr. Spiezia presented groundbreaking early data from our thyroid nodule study offering a new horizon in the non-thermal, minimally invasive treatment of thyroid nodules, which was well received by his physician peers.

We're pleased that awareness and understanding of Pulse Biosciences technology continues to grow among the clinical community. As we pave the way into non-cardiac applications with a current physician focus on the treatment of benign thyroid nodules, we are pleased to be guided by experienced medical professionals. Dr. Ralph Tufano, a world-renowned pioneer in head and neck surgery, has accepted a role as Senior Advisor and Scientific Advisory Board Chair, Head and Neck Surgery. Dr. Tufano currently holds the positions of Clinical Professor of Surgery at the Florida State University College of Medicine and Medical Director, Head and Endocrine Surgery for the Sarasota Memorial Health Care System in Sarasota, Florida, and brings extensive expertise in novel treatment techniques for thyroid and parathyroid surgery.

Dr. Tufano will perform the first commercial cases using the CellFX nsPFA percutaneous electrode system and will help in selecting and training our first set of early users throughout the balance of the year. We have been preparing internally for this 510(k) milestone. Our launch program will partner members of our team with key opinion leaders who are experts in ultrasound-guided ablation. We expect initial training to be straightforward as the system and procedure are intuitive and similar to existing RF ablation procedures. We expect to leverage the expertise of early users to create a reproducible process in clinics to ensure optimal clinical outcomes. Later this year, we plan to initiate a U.S. IDE post-market study in benign thyroid treatments and a European study to support a CE mark, opening the opportunity to commercialize in Europe.

Now I'll pass the call over to Mike Kaufler for an update on our financial results.

Mike Kaufler (VP of Finance)

Thank you, Mitch. Moving down the income statement, I'll focus my comments on our non-GAAP results. I encourage you to review today's earnings release for a detailed reconciliation of non-GAAP measures to the most comparable GAAP measures. In the fourth quarter of 2023, non-GAAP total costs and expenses increased by $1.2 million to $8.9 million compared to $7.7 million in the prior year period. The increase in total costs and expenses was primarily driven by an increase in research and development expenses to support the advancement of our CellFX nsPFA devices. Non-GAAP net loss in the fourth quarter of 2023 was $8.3 million compared to $8.1 million in the prior year period. Cash and cash equivalents totaled $44.4 million as of December 31st, 2023, compared to $50.4 million as of September 30th, 2023.

Cash used in the fourth quarter of 2023 totaled $6.9 million and was reduced compared to $8 million used in the same period in the prior year and $8.7 million used in the third quarter of 2023. Earlier today, the company filed a Universal Shelf Registration with the SEC. We believe maintaining a shelf is consistent with good corporate practices for a public company. I will now turn the call back over to Kevin.

Kevin Danahy (President and CEO)

Thank you, Mike. I will now provide some closing remarks. As we continue in 2024, our focus as a company is to continue building on the momentum of 2023. With the recent 510(k) FDA clearance for the percutaneous electrode, it is our intention to further create the internal and external architecture and support amongst KOLs to ensure and enhance our adoption campaign. To fund our future operations, as detailed in a press release, the company has filed a preliminary registration statement with the U.S. Securities and Exchange Commission, the SEC, to establish a universal shelf pursuant to which, once it is effective, the company may, from time to time, sell an aggregate of $50 million worth of its common stock, preferred stock, depository shares, warrants, debt securities, or units.

Additionally, early today, the company announced that the board of directors has approved a rights offering of up to $60 million worth of units available to all holders of record of the company's common stock as of the close of the market on the record date in April to be announced as soon as practicable. Each unit will consist of one share of common stock and warrants to purchase a total of one share of common stock. The subscription price per unit shall be equal to the lesser of A, $10 per unit, which we will refer to as the initial price, or B, the 10-day VWAP of the company's common stock immediately prior to the expiration date of the offering. VWAP is the volume-weighted average price.

The subscription price will determine the final number of units issuable and subsequently the pro-rata number of units to which a stockholder can subscribe. Each warrant will have a per-share exercise price equal to 110% of the subscription price for the unit. The company intends to distribute to all holders of common stock as of the record date a non-transferable subscription right to purchase units at the price provided. Assuming that the rights offering is fully subscribed at the initial price, the company will receive gross proceeds of up to $60 million, less expenses related to the rights offering, and upon exercise of all the warrants would receive additional proceeds up to $66 million. The rights offering will include an oversubscription right to permit each rights holder that exercises its basic subscription rights in full to purchase additional units that remain unsubscribed at the expiration of the offering.

The availability of the oversubscription right will be subject to certain terms and conditions to be set forth in the offering documents. Bob Duggan, our Executive Chairman and majority stockholder, has indicated that he is in support of the rights offering and expects to participate. The company intends to register the rights offering with the SEC by filing a prospectus on a Form S-3. When available, a copy of the prospectus may be obtained at the website maintained by the SEC at www.sec.gov. The rights offering will be made pursuant to the registration statement on the Form S-3 containing the detailed terms of the rights offering to be filed with the SEC. Any offer will be made only by means of the prospectus forming part of the registration statement. We look forward to providing additional updates on our next call.

Joining me for a question-and-answer session today, our Executive Chairman of the Board, Robert Duggan, Chief Technology Officer and Director, Darrin Uecker, Chief Strategy Officer, Mitch Levinson, and Vice President of Finance, Mike Kaufler. Operator, please open the call for questions.

Trip Taylor (Principal)

Thank you, Kevin. Now we're going to address a few questions we've received over email. Then we'll open up the line for questions from the audience. The first question is, "What is the timeline for the commercialization of the percutaneous electrode? What are your revenue expectations for this year?

Mitch Levinson (Chief Strategy Officer)

Yeah, thanks. This is Mitch. I can take that one. So this percutaneous electrode, with its general ablation clearance, is going to be useful for a lot of soft tissue applications. But as I mentioned, the primary application we're going to start with is in benign thyroid nodule ablation. This technology is highly differentiated. It's brand new to the space. It's going to be disruptive. And so what we're going to be doing, first thing, is to be working with our key opinion leaders who are experts in ultrasound-guided percutaneous ablation. We're going to be optimizing the procedure. We're going to be working toward ideal outcomes. We're going to ensure that this procedure is reproducible. It's teachable. We're going to be building our internal, our external structures.

As soon as we understand all of those and have all those pieces in place and we've got our structure, we're going to be hitting the gas and we're going to be accelerating. We're very excited to get this product out as soon as we're ready to into as many patients as we can. We're looking forward to updating you on a quarter-over-quarter basis. We'll keep you posted.

Kevin Danahy (President and CEO)

Yeah. And Mitch, I'll just jump in just to add a little bit more. We have been working extensively on the internal and external architecture to support this 510(k) clearance. And we're excited to report that we have many surgeons that have reached out to us. We've been working with them. And again, we're just putting that architecture in place that we can show that it's reproducible and teachable. And we know it's better than existing technology to get it out there. And we will update on a quarterly basis on where we stand.

Trip Taylor (Principal)

All right. The next one is, "Can you provide more detail on the first-in-human study for the cardiac clamp?

Darrin Uecker (CTO and Director)

Yeah. This is Darrin. I'm happy to do that. Yeah, we announced today that we're going to be doing a first-in-human feasibility study starting in the middle of the year. And really, this is just in response to a couple of things. Number one, just the substantial interest that we've had from cardiac surgeons on this clamp and this new technology and their high interest in getting it into the clinic. And really, based on all the success we've had with our catheter feasibility study as well as the success with our percutaneous electrode and the feasibility study that we did with that, we just felt like the time was now to do a first-in-human feasibility study with our clamp. And so we're well on our way to doing that. We have to go through the regulatory bodies to get the study approved.

We expect to do that outside the U.S. Again, we're going to do that starting in the middle of the year. It's really just based on all the excitement around it and the success we've had running feasibility studies with some of our other devices.

Trip Taylor (Principal)

All right. The next question is, "You mentioned using the EnSite and CARTO systems with the catheter. Can you elaborate on the mapping integration strategy?

Darrin Uecker (CTO and Director)

Yeah. This is Darrin again. So I think with our catheter, the goal is to make sure that electrophysiologists have a well-integrated solution in their labs to be able to treat their patients effectively. And so we listen to those electrophysiologists and try to understand what kind of tools they need, what kind of tools they're using. And we want to be compatible with all those tools. So we started in our feasibility study with our catheter, integrated with mapping and navigation, and have seen what we think are very encouraging results. In conversation with a number of the EPs who have been involved with that, they requested that we work on integrating with other mapping and navigation systems to really create a system where we can be compatible with almost every EP lab that's in the world today. So there are several mapping and navigation systems out there.

There are a couple, which we've talked about, that sort of dominate this space, in particular, the CARTO system from J&J and the EnSite system from Abbott. And so it's incumbent on us to work to be compatible with those systems so that we can provide EPs with fully integrated solutions to treat their patients. So that's our current strategy.

Trip Taylor (Principal)

All right. Operator, let's now open the line for questions from our listeners.

Operator (participant)

Thank you. At this time, we will now be conducting a question-and-answer session. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate that your line is in the question queue. You may press star two if you would like to remove your question from the queue. We ask that you limit yourself to one question and a follow-up so that others may have an opportunity to ask questions. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment, please, while we pull for questions. Our first question comes from Anthony Petrone with Mizuho Securities. Please proceed with your question.

Brad Bowers (Equity Research Senior Associate)

Hey there, guys. How you doing? You have Brad Bowers on for Anthony today. Just wanted to kind of hear first off about the thyroid indication. It seems like you kind of have a pretty broad indication there with the recent approval. So wanted to kind of hear more about the strategy of going after the thyroid market first. Is it something about the size of the market, the opportunity versus incumbents, or something about ease of entering the market? Just wanted to hear about that. Thank you.

Mitch Levinson (Chief Strategy Officer)

Yeah. Hey, thanks, Brad. This is Mitch. Thanks for that question. Yeah, the benign thyroid nodules, in particular, represents a very large market that we believe is mostly untapped because the technology has not really been there to meet that unmet need. And it also is a nice benign tumor that is well performed by our technology with ultrasound guidance. And it's a really good step forward out into soft tissue ablation in a tumor. So that's why we've decided to start there. And then we expect that people in parallel with that and subsequently, after we have got some initial experience, will be using this in all sorts of soft tissue applications.

[crosstalk]

Trip Taylor (Principal)

Oh, sorry, please. Yeah.

Bob Duggan (Executive Chairman)

This is Bob Duggan. Let me make a comment here. We have clearance from the FDA with regard to soft tissue ablation. We do not have a specific label for thyroid. Thyroid falls under the umbrella of soft tissue ablation. So it is customary in this business for the treating physician to choose the soft tissue that they would like to approach. So everything else is, as Mitch laid it out, but we want to make very sure we're not claiming that we have a clearance for thyroid. But soft tissue includes thyroid. So we market this in the direction of soft tissue ablation clearance.

Brad Bowers (Equity Research Senior Associate)

Understood. Thank you for the clarifications there. And then one.

Bob Duggan (Executive Chairman)

You're welcome.

Brad Bowers (Equity Research Senior Associate)

Just on the clamp product, just wanted to kind of hear about some of the commercialization plans that you can kind of do here while the submission's underway. You talked about some of the advantages versus the incumbent technology. So just wanted to kind of hear about your view of the opportunity and how you think about taking advantage of that out of the gate here. Thank you.

Kevin Danahy (President and CEO)

Yeah. This is Kevin. Thank you for the question. Same with the percutaneous electrode. We continue to look at the internal and external requirements that are going to be needed to launch any of our products. And one of the things that we take very serious is just what is the architecture of support that is going to be needed in the operating room? And some of our predecessors might be there for all cases. We want to be in a place that we put a program in place that allows the account to absorb the information, is taught correctly, and that we can have a walk away that we've transferred the knowledge over to them to empower them to do the cases on their own.

So as we build out our architecture, we want to be very aware of what is needed in order for them to become really secure in the procedure and then what is going to be needed on an ongoing basis. So those are still in design as we work with the FDA for clearance with the clamp specifically, but the same type of philosophy that we're going to use with all indications that we bring.

Brad Bowers (Equity Research Senior Associate)

Thank you.

Kevin Danahy (President and CEO)

Yep.

Operator (participant)

As a reminder, if you'd like to ask a question, please press star one on your telephone keypad. It appears that there are no further questions at this time. I would now like to turn the floor back over to Kevin Danahy for closing comments.

Kevin Danahy (President and CEO)

Thank you, Operator. Thank you all for joining us today. As we reflect on 2023 and we look to 2024, we're extremely proud of the accomplishments that we've had and the milestones that we've achieved. We know that we're just at the beginning of this journey. We're excited that you've all decided to take this journey with us. Nanosecond pulse field ablation is a paradigm shift. We believe that this energy is going to change the way that surgery is done in multiple domains. We're excited to bring that update to you on a quarter-to-quarter basis. Please stay tuned. Stay on this journey with us. There's tremendous excitement coming. We're excited that you're all part of this. Thank you for joining on this call today. We look forward to talking to you soon.