Myomo, Inc. Q1 FY2024 Earnings Call

Good day, and welcome to the Myomo First Quarter 2024 Earnings Conference Call. Please note this event is being recorded. I would now like to turn the conference over to Kim Golodetz. Please go ahead.

Thank you, operator, and good afternoon, everyone. This is Kim Golodetz with LHA. Welcome to the Myomo First Quarter 2024 Conference Call. Earlier this afternoon, Myomo issued a news release announcing financial results for the 3 months ended March 31, 2024. If you would like to be added to the company's email distribution list to receive future announcements, please register on the company's website at myomo.com, or call LHA at (212) 838-3777 and speak with Carolyn Curran. With me on today's call from Myomo are Paul Gudonis, Chief Executive Officer; and Dave Henry, Chief Financial Officer. Before we begin, I'd like to caution listeners that statements made during this conference call by management, other than historical facts, are forward-looking statements. The words anticipate, believe, estimate, expect, intend, guidance, outlook, confidence, target, project, and other similar expressions are typically used to identify such forward-looking statements. These forward-looking statements are not guarantees of future performance and may involve certain risks and uncertainties and other factors that may affect Myomo's business, financial condition, and operating results. These additional risks, uncertainties, and other factors are discussed in Myomo's filings with the Securities and Exchange Commission, including the Form 10-K for the year ended December 31, 2023, and subsequent filings. Actual outcomes and results may differ materially from what's expressed in or implied by these forward-looking statements. Except as required by law, Myomo undertakes no obligation to revise or update any forward-looking statements to reflect events or circumstances after the date of this call. It is now my pleasure to turn the call over to Myomo's CEO, Paul Gudonis. Paul, please go ahead.

Thanks, Kim. Good afternoon, everyone. Thank you for joining us today. Since the beginning of the year, we've benefited from two major developments at the Centers for Medicare and Medicaid Services, or CMS, that have created a significant inflection point for our business. I'll briefly review these policy and pricing actions, discuss how we capitalized on them during the first quarter, and most importantly, how this expanding opportunity to serve individuals with paralyzed arms is unfolding. On January 1, 2024, the MyoPro was reclassified into the brace category rather than durable medical equipment or DME, which means that our powered arm braces would be covered for medically qualified patients and would be reimbursed on a lump-sum basis rather than a 13-month rental in the DME category. This is consistent with the payment policies for other custom fabricated orthotics and prosthetics devices designed for long-term use in the home. Then on April 1, the new pricing determined by CMS went into effect with reimbursement for the MyoPro Motion-G at $65,872 and the MyoPro Motion-W at $33,481. These decisions by CMS opened a new world for stroke survivors and others with neurological injury or disease by increasing access to the MyoPro for the many patients enrolled in standard fee-for-service Medicare, or Part B. Prior to this clarity on reimbursement, we were unable to provide a MyoPro to traditional Medicare patients, and approximately half of seniors in the United States are covered by standard Part B Medicare. Most of the others are enrolled in a Medicare Advantage plan where we've had mixed results with the payers. So here's how we are operating our business based on this new Medicare access. To begin with, for the first time ever, we do not have to turn away prospects who have Part B insurance, as we've had to do for the last 10 years. Instead, we worked with our physicians and therapists to evaluate their medical suitability for the MyoPro and obtain the necessary medical documentation so we could provide a MyoPro to them and submit these claims to Medicare for reimbursement. Second, because the new CMS fee schedule did not go into effect until April 1, we were able to build a backlog of these Part B patients during the first quarter and qualify them. As a result, we had a total of 83 qualified patients in the backlog as of March 31. We expect to be delivering MyoPros to a large number of these patients in the second quarter. Third, as we recently reported, we've had a quick turnaround on some claims filed since April 1, but we've been informed that a number have already been authorized for payments. All four DME MAC regions have approved MyoPro claims and are processing them on a lump-sum basis per the published pricing. We're also pleased to learn that one of our O&P channel partners has also been reimbursed at these rates for their first MyoPro delivered to a Medicare Part B patient. And fourth, with the addition of these Part B patients to our addressable market, we've also begun to expand our capacity to serve this larger pool of candidates. As I mentioned during our last quarterly call, we intend to hire 50 or 60 people this year to increase our clinical reimbursement and manufacturing capacity. We've hired approximately 20 professionals through March 31 and are working very hard to achieve this target, so we can be in a position to double our MyoPro output in the second half of the year. Now that CMS is finalizing and publishing their reimbursement fees for the MyoPro, our revenue grew 9% over Q1 2023 to $3.8 million. Our expectation was for a slightly higher revenue number, and a couple of factors affected our results. First, for some Medicare units that were delivered in Q1, the timing of payments was not as expected. Second, DME MACs paid less than the CMS proposed fee on lump-sum deliveries made between January 1, 2024, and March 31, 2024, which lowered our average selling price or ASP. And finally, several patient fittings got pushed out into April, and many of these items are expected to self-correct in the second quarter. Overall, the first quarter can be best described as a transition quarter. The DME MAC contractors switched from the rental billing model to lump-sum payments, and then the finalization of the new fees occurred at the end of the quarter. While that was happening, we set the stage for strong growth in the second quarter and the rest of the year. We obtained 180 authorizations and orders during the quarter, up 48% from the same period a year ago. Our backlog at the end of the quarter was a record 275 units, which represents MyoPros that are awaiting delivery to patients or receipt of claim payment. This backlog includes these Part B patients, and the overall backlog is up by 56% year-over-year. We also added a record 493 patients into the pipeline in the quarter and we ended with over 1,100 candidates in the process of obtaining a MyoPro, up 30% from a year ago. These pipeline and backlog metrics are important leading indicators of revenue growth, and both are up sharply since we can now serve these Medicare Part B patients. I'll now turn the call over to our CFO, Dave Henry, for a deeper dive into the quarterly financials and our recent capital raise, and then I'll return with comments on our business plans for the rest of the year.

Thank you, Paul, and good afternoon, everyone. Let me start my remarks with a review of our first quarter financial results. Revenue for the first quarter of 2024 was $3.8 million. This consisted entirely of product revenue and was up 9% over the prior year quarter. This growth was driven by a higher number of revenue units, which were up 14% over the 2023 first quarter, offset by a lower average selling price or ASP. Revenue came in somewhat lower than our guidance due to pushouts of some deliveries, payments that had been forecasted, which did not come in, and other payments from CMS on pre-April claims that were lower than the published fees. The payments that pushed out are expected during the second quarter. Revenue in the first quarter includes payments received on 17 Medicare lump-sum Part B claims from deliveries after January 1, 2024. All of these paid claims were underpayments compared to the final fees posted by CMS, which became effective as of April 1, 2024. These payments lowered the ASP in the first quarter to approximately $41,300, which was down 5% versus the prior year quarter. As we announced earlier in the week, we received remittances from all four DME MAC regions for payments for MyoPro deliveries made after April 1, 2024, that are in line with the published fee schedule. Of the 91 revenue units in the first quarter, approximately 29% resulted from fill, which is our term for authorizations and orders received and converted to revenue in the same quarter. 59% of our revenue in the first quarter came from the direct billing channel compared with 69% in the same quarter a year ago. Of note, a record 25% of first quarter revenue came from international locations, primarily Germany. In the first quarter, we were more reliant on payments from insurers to record revenue than in prior quarters. Of our direct billing revenue, 54% was from patients with payers where we were able to recognize revenue at delivery compared with 70% in the year-ago quarter. That equates to a 29% year-over-year decrease in revenue from these payers which were primarily from Medicare Advantage plans in the first quarter of 2024 compared to the first quarter of 2023. We're seeing a slowing in growth of authorizations for Medicare Advantage plans. Some of this is due to reorienting our clinical capacity for Medicare Part B patients, which began in the fourth quarter of 2023, and some may be due to utilization management efforts of Medicare Advantage payers as reported by other payees across the healthcare spectrum. We'll be watching closely in the coming quarters to see if the newly published fees by CMS increases Medicare Advantage authorizations since these plans are now required to cover the MyoPro as long as medical necessity can be established. In the first quarter of 2024, we continued efforts to fill the pipeline and backlog of Medicare Part B patients as the published fees are now effective. Reported backlog now represents insurance authorizations that have already been received but not yet converted to revenue. And in the case of Medicare patients, those patients from whom we have collected medical records and are being qualified for delivery based on our inclusion criteria. To summarize Paul's comments, our backlog at the end of the first quarter of 2024 was a record 275 patients, which was up 56% from our backlog at the end of the first quarter of 2023. Ascending first quarter backlog includes 83 Medicare Part B patients that have either been qualified for delivery with appropriate medical documentation or received a MyoPro and claims have been filed, but payment has not yet been received. These additional Part B patients added to the backlog contributed to 180 authorizations, orders, and other additions to the backlog in the first quarter, which was up 48% over the prior year quarter. Our patient pipeline increased to 1,112 candidates as of March 31, 2024, up 30% from a year ago. A record 493 patients were added to our pipeline during the first quarter, an increase of 12% over the prior year. Our pipeline of Medicare patients increased to approximately 230 at the end of the first quarter. Gross margin for the first quarter of 2024 was 61.2% compared with 67% for the prior year quarter. The decrease was driven primarily by lower ASP and some cost increases, including materials, offset by lower royalty expense as the MIT license expired in November 2023. Operating expenses for the first quarter of 2024 were $6.2 million, an increase of 24% compared with the first quarter of 2023. This increase was driven primarily by higher headcount as we are adding clinical and reimbursement capacity to grow revenue in the second half of the year, higher engineering headcount, outside development spending to accelerate completion of certain sustaining engineering projects, and higher advertising expense. Our cost per pipeline add was $1,597, which is up 1% compared with the prior year quarter and down 29% sequentially. The operating loss for the first quarter of 2024 was $3.9 million compared with an operating loss of $2.7 million for the first quarter of 2023. Net loss for the first quarter of 2024 was $3.8 million or $0.10 per share. This compares with a net loss of $2.6 million or $0.11 per share for the first quarter of 2023. Operating and net losses increased year-over-year due primarily to added headcount to increase clinical reimbursement and manufacturing capacity in advance of the revenue growth we expect later in 2024. Note that the $8.5 million prefunded warrants outstanding from our offerings in 2023 and January 2024 are considered common stock equivalents under GAAP and are included in our weighted average shares outstanding. Adjusted EBITDA for the first quarter of 2024 was a negative $3.5 million compared with a negative $2.5 million for the first quarter of 2023. Turning now to our cash position. Cash, cash equivalents, and short-term investments as of March 31, 2024, were $11 million. Cash used in operating activities was $3.2 million for the first quarter of 2024 compared with $1.8 million for the first quarter of 2023. We completed a registered direct offering in January 2024, generating net proceeds to Myomo of approximately $5.4 million. We believe our cash is sufficient to fund our operations for at least the next 12 months from today. I'll close my comments with a review of our financial guidance. Given our backlog, we believe we're positioned to generate in excess of $5 million of revenue in the second quarter. We call that in the near term, Medicare patient revenues will be recorded at the time of payment until sufficient collection history is established. We continue to expect gross margin pressure in the second quarter of 2024 as we ramp up deliveries to Medicare patients, recording cost of goods sold at that time while recording revenue and payment. Cash used for operations is expected to be higher in the second quarter due to 2023 incentive compensation payments that are expected to be lower in the second half of 2024. We continue to believe that both full year 2024 revenue of $28 million to $30 million, and our targeted cash flow breakeven on a quarterly basis by the fourth quarter of 2024 are achievable assuming we have the required clinical reimbursement and manufacturing capacity by the end of the second quarter, and there are no supply chain disruptions or other unusual events. With that financial overview, I'll turn the call back to Paul.

Thanks, Dave. While looking ahead, we plan to increase the number of qualified patients entering our pipeline since we can now engage with Part B beneficiaries, which should lead to accelerated revenue growth as we obtain the necessary physician orders and supporting medical documentation. Since CMS published these new fees and one of our O&P partners has also received payments, we have seen a significant increase in interest from O&P clinics to provide the MyoPros to patients in their practices. Only 4% of our product revenue came from U.S. O&P channel partners in calendar year 2023, and we are building our program to recruit, train, certify, and support these clinicians. We already see a large number of stroke patients for other braces such as ankle-foot orthoses or AFO. With reimbursement clarity, we expect that these O&P providers will become a much larger percentage of our business even as we invest in expanding our own in-house direct provider and billing operations. We've also started to submit claims to those Medicare Advantage plans that have been reluctant to cover the MyoPro in the past since these payers are required to cover Medicare as long as medical necessity and inclusion/exclusion criteria are met. Many of these Medicare Advantage operators are under increasing scrutiny for refusing to preauthorize medical procedures, and we will be engaging with them to enact more favorable coverage policies for the MyoPro. We also expect continued growth in our international business as we expand our European team and the China joint venture begins production and sales. In fact, I'll be attending the influential OTWorld Conference in Germany this month to assist our team in recruiting additional O&P partners to our distribution network. So with that update and overview of our plans for the rest of 2024, we're now ready to take your questions. Operator?

Before we turn to your questions, I want to mention that we will be attending the Alliance Global Partners Virtual Healthcare showcase on May 21 and the Sidoti Small Cap Virtual Conference on June 12 and 13. We are also available for virtual and in-person investor meetings, so please contact LHA Investor Relations to set up a time. Now, we are ready for the questions.

Exciting time for you guys. I guess I'll start with the top of the funnel. 493 is a big number for pipeline adds in Q1. How should we think about that number going forward? Is that sustainable? I know sometimes you get a little stronger number in the Q1? Or do you think you'd expect it to grow near term?

Thanks, Scott. We expect that pipeline growth number to increase as we add more capacity. We're hiring intake coordinators and more people in our reimbursement and clinical staff. So we should see an increase in that pipeline additions over time because now we can actually engage with these Part B patients who in the past we had to turn away.

Yes. Spring makes it much more efficient and, as you mentioned, reduces the cost per pipeline addition. In the past...

Yes, we are not increasing our advertising spending because we are already generating enough leads. Since we set aside all those Medicare Part B patients, we can now start to engage with them. Therefore, I expect that the cost per pipeline addition to continue to decrease.

Okay. Thinking back to prior quarters, you used to have to turn away some patients due to their provider or classification. How many patients do you currently turn away compared to before, and how should we consider that?

Well, we always screen patients for their insurance coverage. And we've had to turn away people who had payers, such as most state Medicaid plans and certain Medicare Advantage plans, which were denying this coverage for their beneficiaries. So we can now engage with some of those plans. In addition, remember, half of the seniors are on Medicare Part B. Two-thirds of strokes happen in individuals aged 65 and older. So we've got a significant increase in our addressable market now that we can serve Part B patients.

Okay. Great. I have a couple of quick questions. When we examine the model transitioning from pipeline additions to backlog, there's the authorization percentage which you mentioned has decreased slightly in the previous quarter. Do you anticipate that this rate will increase over time due to more standardized or clearer reimbursement?

I would expect that as we move forward, the velocity of things moving through the pipeline into the backlog will increase. This could potentially hold down the pipeline at the ends of quarters due to a faster influx of patients, particularly Medicare patients. However, if these patients proceed to authorization, then the percentage you mentioned should continue to rise over time.

Okay. Great. And final question. The CMS rate for reimbursement was pretty strong relative to what you're currently realizing for price. Forgetting about the noise short term, long term, should we expect to see price increases given that reimbursement rates are perhaps higher than the current price out there?

Yes. The allowable amount for our highest selling product, the Motion-G, is almost $66,000, with Medicare covering 80% of that. For payments received in April on deliveries made that month, we adhered to the published fees, resulting in approximately $50,000 to $51,000 per unit, while our average selling price has been around $42,000. Medicare is expected to contribute a larger portion of our revenue in the future, leading to an increase in the average selling price. We anticipate that the average selling price will settle in the mid to high $40,000 range as our business mix between Medicare, Medicare Advantage, and other payers evolves.

Our next question comes from Anthony Vendetti with Maxim Group.

So some of the questions have been answered. But in terms of the capacity, as you ramp up now with the greater demand as the backlog grows, can you just remind us what your manufacturing capacity is? How many of these devices can you manufacture per year? And do you have the ability to increase that capacity at the current site? Or are you looking at additional manufacturing facilities? What would you consider using contract manufacturers outside the organization?

Yes. Hi Anthony, it's Paul. So we do the final assembly and inspection here, and we've been averaging about 40 to 50 units per month. Our plan is to double that to 80 to 100 units per month in the third and fourth quarters so that we can get to that $10 million revenue quarter. So for us, it's a very asset-light type of manufacturing. We subcontract out the robotic motor unit kits and the 3D printing of the orthotic shelves, and we do the hands-on assembly work here at our current facility. We've been using more space here in the building for manufacturing, and we are looking at other sites so that we can continue to expand that manufacturing. And along the way, too, we're also expanding the intake coordinators, reimbursement staff, and fitting staff.

And you saw some results from that capacity increase in terms of our pipeline as we exceeded that in the first quarter. We had a record number of pipeline adds last year, but we were capped in terms of our capacity to add patients in the pipeline, and those pipeline adds were in the range of 380 to 430 for most of 2023. So as Paul mentioned, we're looking to continue to add capacity to increase those adds to the pipeline in the coming quarters.

Okay. And so you're doing about 40 to 50 units per month now, and you're looking to get to 80 to 100. What's the time frame? Will you be at that run rate by the end of the year or sooner than that? And then in terms of looking to expand beyond that, are you having negotiations with other contract manufacturers or other ways to get to that number above and beyond 80 to 100 a month, if the demand is there for that?

Well, we're hiring people now, and we're training them so that by the fourth quarter, we're at that 80 to 100 unit run rate. Our contractors have engaged with our supply chain managers. They can handle the increased volume. We've placed orders for those long lead time components such as motors and so on. So we continue to plan to expand capacity and revenue going forward.

Okay. And then just lastly on the guidance, still $28 million to $30 million. So as you mentioned, some of the reasons first quarter was a little bit light. But it sounds like whatever that you were like in the first quarter got pushed into the second quarter, but you believe that revenue will materialize in the second quarter and continue to have confidence in the pipeline for the remainder of the year, correct?

Yes. I think a lot of that will eventually happen. I'm not sure how straightforward it will be to receive extra payments from CMS regarding some of the underpayments we experienced in the first quarter; it might be a bit challenging. However, aside from that, for the payments we anticipated that didn't come through, and for deliveries we planned to make but delayed until the second quarter, those should be realized.

Our next question comes from Sean Lee with H.C. Wainwright.

My first question is on the sales cycle. So as you mentioned in the prepared remarks, quite a few of the orders in the first quarter came in and were filled in the same quarter. I was wondering with additional Medicare patients coming in, do you expect that proportion to grow?

So we expect, again, more Medicare Part B patients to be a greater proportion of the pipeline. As Dave mentioned, there's a higher velocity with those patients because there's no need to go through a preauthorization process like we have to do with commercial and Medicare Advantage plans. This can add 30 to 180 days of delay before authorization. So if we can evaluate a Medicare patient today, who meets the criteria, they can go to their physician, and it takes them a month or two to get the medical documentation; they submit it to us. We review it. We can immediately place an order with our operations to develop and build a device for them and fulfill it. So that's where we're compressing that revenue cycle by having these Part B patients as part of our target.

Great. My second question is about the types of devices you're seeing from these Medicare patients. I think you previously mentioned that the mix was around 90 to 10 for Model-G compared to Model-W. Now that you have received a significant number of these orders, do you still observe the same proportion?

Yes. I mean, it really isn't that distinctive by Medicare or Medicare Advantage coverage; so yes, that's a pretty good mix of product line.

Yes. Overall, it's probably between 90% and 95% Motion-G.

Okay. Great. And my last question is about the gross margin. You mentioned that we expect some pressure this year due to production expansions. I was curious, looking a bit further ahead and with Medicare payments coming in more steadily, what do you anticipate the gross margin to be?

Yes, I mentioned that the second quarter gross margin could experience some pressure due to the fact that we are accelerating operations. There is a gap between when we record the cost of goods sold and when we recognize revenue, which is influenced by the time it takes to develop sufficient collection history with Medicare. We account for the cost of goods sold at the time of delivery, but we have to wait for payment to recognize revenue. It is possible that by the end of the second quarter, we will have delivered units for Medicare patients that remain unpaid, which will negatively impact the gross margin. However, I anticipate that this will resolve later in the year as we transition to recognizing revenue upon delivery for Medicare patients, which will address the issue. In the longer term, I expect that we should be able to achieve gross margins in the 70% range.

And our next question comes from Ben Haynor with Lake Street Capital Markets.

First off for me, on the increased velocity that you're going to see from pipeline to authorization to delivery, does that automatically kind of improve the pipeline quality in that there's less time or less opportunity for patients to drop out as well?

Yes, Ben, that's a very good point because the longer that cycle extends, there are more chances that a patient will change insurance or suffer another medical issue like a subsequent stroke. Also, with the pipeline quality being more Part Bs, we're not as dependent on these pre-authorizations because our success rate on the Medicare Advantage pre-authorization has ranged significantly in the 40% to 50% range for those pipeline adds. So having Part Bs, which are medically qualified, we'll have a much higher success rate of turning those into actual deliveries.

Got it. That's helpful. And then on the Part Bs that you've had to turn away historically, have you undertaken much activity to try and reactivate and add some of those folks in the pipeline that you have their contact information from previous leads?

Yes, these people are in our CRM system, and we're following Medicare regulations regarding how far back you can go out to reach out to them. I'm trying to reach out to them. I've got to add more people in my clinical and call center teams to be able to reach all those patients that may be eligible for the MyoPro. That's why we're hiring these people right now.

Under Medicare regulations, we have 15 months to reach back and contact those individuals again. So we have some time here.

Okay. So, is it correct to think of it as taking the portion of Medicare non-Part B patients entering the pipeline, doubling that number from the last 15 months, and that gives you an estimate of how many people we could potentially contact, if that makes sense?

Well, given that our addressable market has doubled because of these Part B patients, assuming we can evaluate all those patients and get them into the pipeline, yes, that pipeline should increase again over time.

Okay. Got it. And then lastly for me, just with the U.S. O&P channel being 4% last year, with this year being a bit of a transition year and getting people back engaged on that channel. What do you think that would ultimately look like over time, whether it's a year from now or even several years from now? Is that going to be a third of your business, half of your business, what does that look like in terms of U.S. revenues?

I think it could be a significant part of our business just because there are 3,000 of these O&P clinical offices around the country. Not all of those specialized in upper extremity or myoelectric devices, but there has been keen interest at the various O&P conferences we've attended. We're planning a schedule of classes to certify these CPOs later this year. I believe we'll see the O&P channel starting to kick in for the latter part of the year and then start to grow next year and in the years beyond. But it could eventually become the majority of our business over time.

And we don't think that the growth in the O&P channel will significantly degrade our operations as we pursue direct provider patients because when we do our advertising, we're primarily targeting individuals who had their stroke several years ago and are out of the healthcare system for their stroke. Meanwhile, the O&P channel sees patients who are more recent after having their stroke. So it's a different demographic. That's why we believe we can experience significant growth in both areas without one negatively impacting the other.

Okay. That makes sense. So you guys are going more after the prevalence group rather than the incidence group.

We have been, yes.

Congrats on the progress.

Our next question comes from Edward Woo with Ascendiant Capital.

Yes. Congratulations on the quarter and definitely congratulations on your international growth again. Can you talk about what you were doing that may be different or the same as in the U.S. to be able to have that momentum? And can you talk about the overall market opportunities on how much more growth can there be in this channel?

Sure. Well, I'll speak to Germany specifically because that's our best international market at this time. It has a significant population, over 80 million, a good economy. They prefer high-tech products. We have developed a network of O&P channel partners, over 100 different locations now. Our clinical team goes in there, trains them. These O&P providers see the patients, they work with the insurance companies that they are already contracted with. So that approach is working. We're also using social media there to generate demand. I see it as a good example of what we can achieve through an O&P channel. That's what's growing the business there in Germany. So we've said we're doubling down, putting more resources into Germany because it presents a significant untapped market opportunity. We may also enter into other selected markets based on the reimbursement environment there.

Great. So the population, almost of 20% of the U.S., do you think the market there can reach about 20% of the size that you expect in the U.S.?

Yes. It could very much do so. In fact, it was 25% of our revenue in this first quarter, but now we'll see accelerated U.S. revenue with the addition of the Part B patients.

Thank you. This concludes our question-and-answer session. I would like to turn the conference back over to Paul Gudonis for any closing remarks.

Thank you, operator. As you all know, we've had a long journey to establish these reimbursement policies and pricing for the standard Medicare Part B patient population. It's very gratifying to see these patients have the same equitable access as other patients with other health insurance plans. At a recent fitting of a MyoPro for a stroke survivor, her husband said, "Thank God for Medicare because a year ago, we just couldn't get this device for her." As we discussed today, we're investing in the resources necessary to serve this larger pool of potential MyoPro candidates, and we're also increasing our R&D investments to build upon our market-leading position. With growth in volume and revenues, we can achieve our target of cash flow breakeven on a quarterly basis by the end of the year, if we're able to add the expanded delivery capacity as we planned, and Medicare reimbursement continues on a timely basis. These actions will position us well as we head toward a much larger profitable company addressing this large unmet medical need and improving the lives of many more patients in selected markets worldwide. So thank you for your participation today, and have a good evening, everyone.

Thank you. The conference has concluded. Thank you for attending today's presentation.