Good day, and thank you for standing by. Welcome to the Helius Medical Technologies Fourth Quarter and Year-End 2022 Earnings Conference Call. As a reminder, today's conference may be recorded. I'd now like to hand the call over to your speaker, Michelle Bilski, Investor Relations. Please go ahead.

Thank you, operator. Welcome to the fourth quarter and year-end 2022 Earnings Conference Call for Helius Medical Technologies. This is Michelle Bilski of In-Site Communications, Investor Relations for Helius. With me on today's call are Dane Andreeff, Helius Medical's President and Chief Executive Officer; and Jeff Mathiesen, Chief Financial Officer. Also on the call today is Dr. Antonella Favit-Van Pelt, Helius Medical's Chief Medical Officer, who will be available as needed during Q&A. At this time, all participants have been placed in a listen-only mode. Please note that this call is being recorded, and access to the webcast can be obtained through the Investors section of Helius website at www.heliusmedical.com. Before we begin, I would like to remind everyone that our remarks and responses to your questions today may contain forward-looking statements that are based on the current expectations of management. These forward-looking statements involve inherent risks and uncertainties that could cause actual results to differ materially from those indicated, including those identified in the Risk Factors section of our most recent annual report on Form 10-K and quarterly reports on Form 10-Q. Such factors may be updated from time to time in our other filings with the SEC, which are available on our website. All statements made during this call are as of March 9, 2023. We undertake no obligation to publicly update or revise our forward-looking statements as a result of new information, future events or otherwise, except as required by law. I would now like to turn the call over to Dane Andreeff, President and Chief Executive Officer of Helius.

Thank you, Michelle, and welcome, everyone. It was another strong quarter for Helius and our Portable Neuromodulation Stimulator or PoNS device, which is indicated in North America for treatment of gait deficit due to mild-to-moderate symptoms of MS when used in conjunction with a supervised therapeutic exercise program. PoNS is also authorized in Canada for the treatment of chronic balance deficit due to mild-to-moderate traumatic brain injury or TBI and just announced this morning for stroke. In the U.S., PoNS also has an FDA breakthrough designation for stroke in addition to the breakthrough designation for MS, which we believe will be a significant benefit as we seek reimbursement in the United States. During the fourth quarter, the benefits of PoNS therapy continued to resonate with health care providers, physical therapists and patients in the U.S., as we add prescribers and train PTs because PoNS is the only available portable and readily accessible neurostimulation therapy with the potential to generate neuroplasticity, essentially rewiring parts of the brain. It is a potential game changer for people suffering from gait and balance in MS. Our mission is to make this important and innovative technology available to as many qualified patients as possible and we are working to improve the access on multiple fronts. Physical therapists play a key role in PoNS treatment and training them quickly enough to meet demand was a bottleneck we faced early in the U.S. To standardize the process and reduce training time, we introduced an online training module, which allows practitioners who wish to treat MS-related balance and gait deficits to learn remotely at their own pace in 3 hours or less, instead of through an in-person multi-day course. It has quickly become the primary means for training therapists, which means faster relief for patients. Another way we've improved access is through our recent partnership with UpScript, a leading telehealth company focused on providing medications and devices direct to the consumer. Through ponstherapy.com, Americans with gait and balance deficits can now access online health evaluations to fill PoNS therapy prescriptions through a network of fully licensed providers with e-prescribing capabilities and obtain PoNS through home delivery. The initial response has been overwhelmingly positive, and the first devices were shipped in January 2023. Patients who are motivated to improve their walking are now taking the fight against MS into their own hands. Sales of PoNS devices are currently on a cash pay basis, but we don't want costs to be an impediment to use. In June 2022, we launched our Patient Therapy Access Program, or PTAP, which provides patients access to on-label PoNS therapy at an early 85% discount to list price. PTAP was scheduled to expire at the end of 2022, but we're pleased to announce that we're extending this program through June of 2023. The vast majority of U.S. PoNS device prescriptions in the fourth quarter were through the PTAP program. The Neurology Center of New England has been an important contributor to our PTAP program, and we were thrilled to add the institution to our PoNS therapeutic experience program. PoNSTEP, an open-label observational trial that allows us to partner with some of the nation's premier academic medical centers to observe PoNS therapy in a real-world study while enabling key opinion leaders in MS management to build their knowledge and advise the broader medical community. During the fourth quarter, we also added MGH Institute of Health Professions and Oregon Health & Science University to the program, bringing the total number of PoNSTEP centers of excellence to 5 as of today. To most effectively help those suffering from balance and gait impairment, it's critical that we engage not only the patients but also the two other PoNS therapy stakeholders, the neurologists, who prescribe PoNS and the physical therapists who oversee the treatment. You've already heard how we've improved and streamlined the training process for physical therapists, and we continue to maintain an active dialogue with them in order to best serve them and their patients. We just returned from the American Physical Therapy Association Conference for physical therapists, national, regional, PT clinics, and neuro rehab specialists and have well over 200 leads to follow up on. Interacting with the broader neurology community, as we have with PoNSTEP, is another key to properly educating patients and providers about the mechanism of action and benefits of PoNS. In April, we will be attending the American Academy of Neurology Annual Meeting in Boston. And at the end of May, we'll be at the consortium of multiple sclerosis centers, annual meeting in Denver, which is attended by the MS Centers of Excellence focused on MS neurologists. Turning to our Canadian activities. At the end of 2022, PoNS was authorized for sale in Canada for chronic balance deficit due to mild-to-moderate traumatic brain injury, as well as mild-to-moderate symptoms of MS. Yesterday, we learned that Health Canada extended PoNS indications to include use as a short-term treatment of gait deficit due to mild-to-moderate symptoms from stroke. An estimated 878,000 Canadians are currently living with stroke, with more than 89,000 new strokes occurring every year, and gait impairment is a major source of post-stroke disability. A real-world evidence database analysis showed that mild and moderate stroke patients using PoNS therapy experienced an average 6.7 point improvement in their functional gait assessment score over the 14-week treatment period, which far exceeds the 4.2 minimal detectable change usually seen in stroke patients. Before starting treatment, most patients were considered at risk of falling. But after 14 weeks on PoNS therapy, 28% of the patients were no longer at risk of falling. Routine rehabilitation and physical therapy does not usually provide a meaningful reduction in this risk, typically in the 1% to 3% range. So this is a significant improvement. PoNS has been commercially available in Canada since 2019 for MS and TBI, and we're happy that Health Canada authorized PoNS for stroke, enabling Helius to deliver clinically meaningful benefits for stroke patients as well. This was a huge win for Helius and for Canadians suffering from balance and gait impairment as it's become evident that PoNS therapy employs a shared mechanism of action and provides a significant and clinically meaningful improvement in balance and gait regardless of the underlying medical conditions. We also recently extended our partnership agreement with Canada's HealthTech Connect, a leading health technology company specialized in neurotechnology innovations. This agreement grants HTC the exclusive right to purchase, market, sell, and distribute PoNS through the Metropolitan Vancouver area subject to certain minimums. The initial term is for 5 years with the possibility to extend it to 10 years. HTC has been an instrumental partner for Helius, and we're excited to strengthen our relationship and expand our presence across Vancouver through HTC's network of leading-edge neuro rehabilitation clinics. Other exciting developments are underway in Canada, and we hope to share them very soon. Though it is currently a smaller market for us, we believe Canada's growth potential parallels the U.S. market in the near term due to the mobile indications, in particular, TBI and now stroke. With that, let me turn the call over to Jeff to discuss our fourth quarter financial results in detail.

Thanks, Dane. It is a pleasure to be with you today. Total revenue was $282,000 for the fourth quarter of 2022 compared to $258,000 in the fourth quarter of last year, an increase of 9% comprised primarily of product sales in both periods. Full year 2022 revenue was $787,000, an increase of 51% over 2021, reflecting the impact of the U.S. commercial launch of PoNS for MS in April 2022, partially offset by a small decrease in revenue in Canada that resulted from exchange rate changes. For the fourth quarter of 2022, our gross profit was $132,000 compared to $129,000 in the prior year. Operating expenses for the fourth quarter of 2022 were $2.8 million compared to $4.2 million in the fourth quarter of 2021, a decrease of $1.4 million. The decrease was primarily the result of lower product development and clinical trial activity following the U.S. commercial launch of PoNS. Operating loss for the fourth quarter of 2022 was $2.7 million compared to a loss of $4.1 million for the prior year period. The public warrants we issued in connection with the August 2022 financing are accounted for as a derivative liability instrument on the balance sheet. The increase in the valuation of these derivative instruments from the date of the offering to the quarter or year-end resulted in an expense of $2.5 million during the quarter. The warrants will require revaluation in future quarters tied to our share price, resulting in non-cash income or expense for each reporting period. We reported a net loss for the fourth quarter of 2022 of $4.9 million or a loss of $0.17 per share compared to a net loss of $4.1 million or a loss of $1.31 per share for the same period last year. Our cash burn from operations for the fourth quarter of 2022 was $2.1 million, a significant decrease from the average quarterly run rate of approximately $4.1 million over the previous three quarters of 2022. This reflects the results of our focus on reducing cash burn and extending our cash runway beyond 2023. As of December 31, 2022, we had $14.5 million of cash and no debt. Turning now to our outlook. We currently expect 2023 revenues to exceed prior year levels and to increase throughout the year as the U.S. commercialization of PoNS continues to develop, but we may experience quarterly fluctuations as we make refinements to our U.S. commercial rollout of PoNS. We believe broad third-party payer reimbursement will be needed to achieve our full revenue potential. Our 2023 quarterly cash burn is also expected to be below comparable quarters in 2022, reflecting the results of our actions in 2022 while recognizing that the first quarter cash burn is typically the higher quarter as a result of the concentration of cash payments for such things as bonus payments, audit fees, and public company-related expenses. With the projected increase in sales of PoNS in the U.S. and Canada and the $14.5 million of cash on hand at year-end, along with our reduced cash burn, we believe we have the cash runway to take us through 2023. With that, operator, let's now open the call for questions.

Our first question comes from Jonathan Aschoff with ROTH MKM.

Congrats on the progress. And I'm curious, the PTAP extension, is that driven overwhelmingly by the price, the cash price being prohibitive, let's say?

Yes, first and foremost, since this is cash pay and we are implementing our reimbursement strategy. We also want to share the adoption and increase awareness among the physical therapists that we are training in relation to the neurologists, so that everyone becomes increasingly experienced with PoNS therapy.

Okay. And how about the TEP traction? What can you tell me about people in TEP?

So currently, we are enrolling into our 5 sites at the moment. So we're pleased with the 5 sites that have signed up so far. We're looking to hopefully get to the 10 to 12 level by year-end.

Okay. And how's about trial enrollment for stroke?

At this time, we have not rolled into our stroke trial.

Okay. Lastly, when do you think you might have data ready to submit or discuss that would support insurance reimbursement?

We are approaching our reimbursement strategy in the United States for MS and gait deficits through two main avenues. Firstly, we are currently engaging with CMS and plan to meet with them in the next three to six months to discuss our coding. Secondly, the TCET program for emerging technology is set to launch. According to our information, the law and rulemaking will be released in April, followed by a 60-day period for questions regarding the TCET program. It's already scheduled for discussion at the White House in September. To support our reimbursement efforts, we are implementing programs to generate evidence for insurance, such as our PoNSTEP program and our current registry focused on MS, where we are gathering data and medical records. Antonella, would you like to add anything to this?

Yes, thank you, Dane. Currently, we are working on the concept program, which aims to provide data on the real-world utilization of PoNS and its effectiveness under various adherence conditions to physical therapy. Additionally, we have the registry program that focuses on collecting information about the therapeutic outcomes of PoNS, particularly concerning the management of MS patients. We intend to gather and present soft outcomes to both CMS and insurance partners to demonstrate cost effectiveness in managing MS patients.

Okay. And PTAP is still $3,895 and the cash is still around $17,000, $18,000?

This is Jeff. The PTAP is $3,895. The cash pay pricing is around $14,500.

Our next question comes from Jeffrey Cohen with Ladenburg Thalmann.

This is Destiny on for Jeff. I just have a couple of questions about the topics you discussed. Can we start with how many physical therapists you've trained so far through your online training program?

We haven't announced that, but it's well over 100 right now. And if you look at just the follow-ups, which we have well over 200 follow-ups with PTs, with neuro PT centers and some of the bigger national chains like ATI, like PT solutions and also physical balance centers.

Got it. Okay. And I'm wondering around PTAP. You said it was extended until June 2023. So what kind of access strategy are you thinking about implementing or leveraging beyond June 2023? Is there the opportunity for it to be extended again? Or would you have something a little different? Just high level, what are you thinking in terms of that?

At the moment, we have, okay. Go ahead, Jeff.

Yes, sorry. Yes. So I think at the end of the day, we're going to be focused on making sure that there's access to PoNS therapy. We're also very much interested in making sure that we're gathering data that will allow us for reimbursement. And so I think that we will continue to look at ways to make sure that there's access to PoNS, but also pushing towards getting reimbursement because ultimately, reimbursement is going to be key. So I think we've announced until June 30, and as June 30 approaches, we will evaluate what makes sense on a go-forward basis at that point.

Okay. Perfect. Yes, I know you guys have been very diligent in trying to make this accessible. So awesome. Last one for us. You mentioned about 200 leads that you're going to follow up with. Can you just walk us through what that follow-up process looks like? And can you assign any timing to any of those leads? Or is it still a bit too early to tell?

We've actually had a number of PTs access our PoNS therapy online training already. Before the conference, we actually did a teach-in; our Director of Physical Therapy at Helius, Whitney, did a great job. So she actually trained PTs live right there and then at our booth after hours. So we're getting actually a great response. But really definitely a bigger movement would be going after the super regional PT clinics like ATI, like PT solutions and a few others that we would like to be able to just roll it out at a national or a corporate level. The PoNS training is so easy; it's free to the PT and to the clinic. They could do it in 3 hours or less at their own time. They could break it up, and it's actually a wonderful resource for them, but also for the patient.

Our next question comes from Anthony Vendetti with Maxim Group. After hours, we’re seeing a great response. However, we are truly looking to make a more significant impact by targeting larger super regional physical therapy clinics like ATI and PT Solutions, among others. We hope to implement our approach nationwide or at a corporate level. The training for PoNS is very straightforward and free for both the physical therapist and the clinic. They can complete it in three hours or less at their convenience, even in segments. It serves as a valuable resource for both the clinics and the patients.

Good to see you, Dane, out at the PT conference in San Diego.

No. That was a wonderful meeting. Thank you, Anthony, for spending time with me.

Absolutely. Most of my questions were answered, but can you talk a little bit about your operations in Australia? I know it's approved; they're authorized for sale for short-term use. Is that still early stages? Or just an update on the status there?

Well, sure. So again, just to remind everyone on this call, our investor base, the TGA, which is the regulatory body, approved Helius for balance and gait deficit with no indication. So if you think about that, it really puts the PoNS device and PoNS therapy back into the practitioner's hand. So if they have a stroke patient in one corner with gait deficit or an MS patient with gait deficit or a TBI across the room who has a sound deficit, they're able to treat the patients. So that is a very exciting potential for us. We are talking to consultants and looking at distribution partners for Australia, but no news yet at the moment.

Okay. Okay. But that broad sort of indication seems like a significant market opportunity potentially in Australia?

Very much so. Even though it's a smaller country than Canada’s 40 million people, I think Australia has 26 million. Like you said, PoNS therapy or PoNS device can be treated for any of their balance and gait deficits across any neurological indication or traumatic brain injury.

Okay. Great. Great. Just remind us, you mentioned that there's another conference upcoming, a neurology conference you're going to be attending. When is that? What's the goal when you attend that?

Yes. In April, there's a conference in Boston hosted by the American Academy of Neurology, which is aimed at general neurologists. It's important to note that all neurologists and prescribers can offer treatments for gait deficits caused by multiple sclerosis. We plan to have a booth there to showcase our clinical and real-world data on MS, and to discuss how accessible our platform is for rehab hospitals and clinics in the U.S. We want to educate them on how easily their physical therapists can be trained to recognize PoNS as an effective treatment for gait deficits due to MS. Additionally, there's an event in Denver focused on MS neurology, specifically for the MS Centers of Excellence. Our education efforts will target three key groups: patients, general neurologists and MS specialists, and physical therapists or rehab hospitals.

Okay. Great. And then maybe more for Jeff. I guess the guidance is that revenues will exceed what they were in 2022 in 2023. At this stage, there could be a lot of quarterly fluctuation. Should we expect that fluctuation to be similar to or trend according to the pattern seen in 2021 and 2022? Or could it actually vary significantly each quarter due to the stage of growth you're in?

I think it's more about the latter. We're implementing several initiatives for the rollout in the U.S., so there will be fluctuations in the uptake here. That said, the third quarter has always been a weaker period in Canada due to seasonal vacations. This typically results in lower performance during that quarter. However, the main issue for us is that we lack historical data to truly understand the emerging trends. Therefore, I prefer not to make commitments until we observe how things develop over time.

There are no further questions at this time. I'd like to turn the call back over to Dane Andreeff for closing remarks.

Great. Thank you, everyone. We, at Helius, continue to be gratified by the marketplace's reception to PoNS and are very proud of the foundation we've built. PoNS is an important therapy that has the potential to improve the lives of millions, and we remain committed to bringing this innovative technology to all those who can benefit. Thank you for your time and interest in Helius Medical Technologies, and we'll speak again next quarter. Thank you.

This concludes today's conference. Thank you for participating. You may now disconnect. Everyone, have a great day.