Greetings and welcome to InspireMD First Quarter 2022 Earnings Call. At this time, I'd like to turn the call over to your host, Chuck Padala of LifeSci Advisors. Thank you, you may begin.

Thank you, operator, and good morning, everyone. Thank you for joining us for the InspireMD First Quarter 2022 Financial Results and Corporate Update Conference Call. Joining us today from InspireMD are Marvin Slosman, Chief Executive Officer; and Craig Shore, Chief Financial Officer. During this call, management will be making forward-looking statements, not historical facts that are based upon management's current expectations, beliefs and projections, many of which, by their nature, are inherently uncertain. They involve risks and uncertainties that may cause actual results to differ materially from those expressed in forward-looking statements. For more information about these risks, please refer to the risk factors described in InspireMD's most recently filed periodic reports on Form 10-K and Form 10-Q filed with the U.S. Securities and Exchange Commission and InspireMD's press release that accompanies this call, particularly the cautionary statements made in it. The call contains time-sensitive information that is accurate only as of today, May 10, 2022. Except as required by law, InspireMD disclaims any obligation to publicly update or revise any information to reflect events or circumstances that occur after this call. It is now my pleasure to turn the call over to Marvin Slosman, Chief Executive Officer. Go ahead, please, Marvin.

Q1 2022 proved to be a very busy and productive quarter at InspireMD with approximately 1,910 CGuard stent systems sold to our 31 served markets, representing revenue of $1.161 million. We accelerated enrollment in our C-Guardians FDA trial, including initiating our first European site, preparing for enrollment of the first randomized cases in the CREST-2 trial, received regulatory approval for our European logistics hub, enabling our direct sales in the U.K. and France, and prepared for expansion into more direct sales markets. We added 5 new members of our expanding global team, including seasoned sales and marketing professionals, as well as bolstering our world-class engineering department to keep pace with our expanding R&D programs and commercial growth. Our mission at InspireMD is to establish a new standard of care for addressing carotid artery disease and stroke prevention, which is foundationally different from any other company. The best patient outcomes, both short and long term, depend on a stent platform that delivers unmatched clinical results to this ever-expanding endovascular-focused market. The CGuard carotid stent system, through its unique design and proprietary MicroNet mesh protection, delivers and maintains superior vascular patency compared to all other stent devices and open surgery. In order to enable this change to better patient care and to make CGuard ubiquitous in this market, we're focusing on all specialties treating carotid artery disease. By approaching this market in this comprehensive stent-centric approach, we believe we can enable the conversion of this surgically dominated $5 billion global total addressable market to a less invasive endovascular standard of care with sustained results. Revenue for Q1 was $1.161 million, reflecting a 20% growth year-over-year in CGuard sales on 1,910 procedures and units sold. It is important to note that procedural volume is a more accurate indicator of the strength and size of our business as we currently share a proportion of the average sales price in the major markets with our distributor partners, further emphasizing our priority to convert more markets to a direct sales approach to fully capture top-line revenue recognition. Our European hub will facilitate and accelerate our planning for a more direct market conversion for distribution during 2022. Turning to our advancing enrollment in the C-Guardians FDA IDE trial. Our expanded site training and enrollment continues with 13 sites currently enrolling in the U.S., with plans for 3 more along with our first site in Europe, with plans to start 3 more there, all during the next 2 quarters. Patient enrollment continues to accelerate rapidly with more investigators gaining experience and confidence in CGuard. Our current outlook remains consistent, anticipating the completion of enrollment of the trial in Q1 2023. We continue talks in Japan with distributor partners interested in representing CGuard, which would complement our distribution agreement in China signed last year. We believe the Asian market offers an opportunity for CGuard as the existing standard of care for procedural intervention is predominantly endovascular-focused and less surgically dominated. As we announced in our previous reporting, our commercial pathway to business growth for CGuard will be facilitated by a new transfemoral delivery system, CGuard Prime, offering greater navigation and flexibility to address challenging patient anatomy as well as a broader set of evolving indications. CGuard Prime will be available in both standard and short shaft versions compatible with the development of our SwitchGuard TCAR accessory device, thus enabling a transcarotid option for our toolset designed for those clinical needs and conversion of greater surgical procedures to a stent platform with CGuard EPS. Both devices are planned to launch in early 2023, and we believe will foundationally change the landscape of CGuard utilization to the broadest group of specialists performing endovascular procedures. Thus far, the feedback from our KOL community has been enthusiastic and encouraging. As we chart a new course for how carotid stenosis is managed and how strokes are prevented with our clinically proven CGuard EPS system, our mission is to provide the best patient outcomes and a broader set of tools to unlock this tremendous potential in this rapidly growing and evolving market segment. With that, I'll turn the call over to Craig to review our first-quarter financials. Craig?

For the first quarter of 2022, revenue increased 18% to $1.183 million from $1.006 million during the first quarter of 2021. This increase was predominantly driven by a 20% increase in sales volume of CGuard EPS from $969,000 in the same period 1 year ago to $1.161 million for the first quarter of 2022. This sales increase was mainly due to growth in existing and new markets as well as the returning demand from hospitals in a post-COVID-19 environment. In addition, U.S. sales increased due to stents used in the C-Guardian FDA clinical trial. Due to the ongoing conflict in Russia, Belarus, and Ukraine and related currency restrictions, we did not sell to these 3 countries during Q1, limiting our reported growth. If we eliminate the impact of these countries, there would have been a 32% year-over-year growth in CGuard EPS versus the 20% reported number. Gross profit for the first quarter of 2022 increased by $16,000 to $122,000 compared to a gross profit of $106,000 for the first quarter of 2021. This increase in gross profit resulted from decreases in write-offs, which were driven mainly by component supply issues. Gross margin was 10.3% during the 3 months ended March 31, 2022, versus 10.5% during the prior year period. Total operating expenses for the first quarter of 2022 were $4.6 million, an increase of $1.2 million compared to $3.4 million for the first quarter of 2021. This increase was primarily due to increases in expenses related to the commencement of the C-Guardian FDA study and share-based compensation. Net loss for the first quarter of 2022 totaled $4.5 million or $0.57 per basic and diluted share compared to a net loss of $3.2 million or $0.53 per basic and diluted share for the same period in 2021. As of March 31, 2022, cash, cash equivalents, and short-term bank deposits were $29.9 million compared to $34 million as of December 31, 2021. I'd like to now turn the call over to the operator for questions.

Our first question comes from the line of Ben Haynor with Alliance Global Partners.

And congrats on the progress. It seems like things are moving along nicely. Now on the co-principal investigator that you have in Poland. I know he's been pretty prolific in doing CGuard cases in the past. I was wondering if you expect his case cadence to be similar to someone like Dr. Metzger or slightly slower?

Ben, thanks for the question. Professor Piotr Musialek is the person you're referring to, and he has been a KOL of ours for quite some time, probably has the most experience with CGuard of anyone in the world. And we certainly believe that his volume of procedures and contribution to the trial will be on par with any of the top carotid stenting physicians in the world. So we're incredibly enthusiastic about Professor Musialek being involved as a co-PI and also driving incremental enrollment in Europe in general; he'll be leading the effort with our investigators there.

Okay. Great. And then on the conversion to direct and the distribution hub agreement that you guys signed. What countries do you intend in Europe to go direct first? I know you're already direct in France, but what are the next ones on the list?

Yes. So Ben, we're direct in France and the U.K. both, and we're in the process of fine-tuning the details on the other countries. As you can imagine, it's a bit sensitive given the fact that we have distribution agreements in place in many of those areas. So we're working through the details now, but the first step was to put this logistics hub in, get it cleared from a regulatory perspective, and make sure that we're in a position to sell efficiently on a direct basis. There'll be much more information in subsequent calls.

Okay. So stay tuned there. And then did I hear you correctly in the prepared remarks that you're in the CREST-2 trial and have done the first cases? And if so, how many cases do you think might be available to you guys? I forget exactly where the enrollment stands on that trial in the stent side.

Yes. We're preparing for the first cases right now. Obviously, there's a considerable amount of paperwork to be done and logistics to be sorted out. We're thrilled to have been approved to participate in the stenting arm of the CREST-2 trial. That was a huge milestone for us, and we've been working diligently with the CREST-2 executive committee to get the right locations lined up, some of which are current C-Guardians sites. We will have much more detail on that and enrollments, hopefully during the quarter that we can share in detail. But right now, we're preparing those sites. We don't have a firm number for you at the moment, but we certainly think that CGuard is bringing a refreshed view of those operators being interested in contributing to the stenting arm, which we believe will help considerably in the effort with the CREST-2 enrollment.

Okay. That's helpful. And then I don't know if you guys have better information, but I thought I had heard that the stenting arm was a decent amount behind the other arm there. What do you guys have any sense of that? And any additional color that you have on how that trial is progressing?

We don't have any specific details to share at this time. We have certainly heard similar feedback, but we don't have a quantitative measure available right now. However, with CGuard now open for enrollment, we hope that it will enhance the stenting side of the enrollment and make it more robust. Unfortunately, I don't have a specific number for you at this point.

Okay. That's fair enough. And then just back on your KOL event, I think Dr. Metzger and Dr. Lyden both made statements suggesting that CMS was in the process of reviewing the national coverage determination for stenting and may be likely to expand coverage in the near term to match CA. Is there anything more on that front that you guys have heard?

We don't have any more details, except we're certainly supportive of the effort and encouraged by the trend here. We hope that CMS does begin to cover standard risk, and that would be a tremendous milestone for us, as well as for all those that contribute to the stenting side of the business and the endovascular approach. So we're, again, encouraged by the progress. We don't have any details other than we continue to support all of the efforts industry-wide that are going on to try to enable that change, which would be a huge uplift for us and the space in general.

A big deal for sure. And then lastly for me, just what activities remain on CGuard Prime and SwitchGuard regarding development and submission and all that fun stuff? And then what geographies do you plan on launching that in first? And is the decision to go direct partially driven by those products?

Yes, absolutely, Ben. I think you're right on there. Our direct effort in many of the countries is driven by the fact that we've got new products to launch, and we certainly want to take full advantage of that momentum. Right now, we're well into the R&D and what we call V&V stage of getting these products through the pipeline and obtaining all the clinical data required to get that into the regulatory pathway. Our hope is to continue that effort and to have all of those approvals take place in a timely manner. We're anticipating a Q1 launch of both products, and we're incredibly enthusiastic about both of those because they offer tremendous access to a much broader base of physicians interested in stenting. Most importantly, that's a comprehensive approach to both the interventionalists and vascular surgeons, which is fundamentally different from how we approach the business. We see this as a comprehensive approach, and the ultimate goal is to play CGuard stent, which is the basis of our business. From a patient quality of life and clinical outcomes perspective, the stent is really what matters. So we're really looking forward to having those delivery systems in the pipeline and available in 2023.

There are no further questions in the queue. I'd like to hand the call back over to Marvin Slosman for closing remarks.

Thank you. I'd like to thank everyone for taking the time today to join the call and for the ongoing support. We're extremely proud of the progress from the quarter and look forward to 2022 being a breakthrough year for InspireMD.

Ladies and gentlemen, this does conclude today's teleconference. Thank you for your participation. You may disconnect your lines at this time, and have a wonderful day.