Stereotaxis, Inc. (NYSE: STXS) Second Quarter 2022 Earnings Conference Call August 9, 2022 10:00 a. m. m. ET
company representatives
David Fischel – President and Chief Executive Officer
Kim Peery – Chief Financial Officer
Conference Call Participants
Josh Jennings as Cowen
Adam Maeder – Piper Sandler
Neil Chatterji – B. Riley
Alex Nowak – Craig-Hallum Capital Group
Frank Takkinen – Lake Street Capital Markets
Nathan Weinstein – Aegis Capital
Javier Fonseca – Spartan Capital
Operator
Hello! Thank you for joining us in convening stereotaxis’ 2022 quarter earnings convention.
Certain statements from the convention call and the question-and-answer era may relate to long-term events, expectations and, as such, constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.
Such statements involve known and unknown hazards, uncertainties and other points that would possibly cause the Company’s actual long-term results, functionality or achievements to differ materially from the statements that company officials would possibly make today. These dangers are described in detail in our public filings with the Securities and Exchange Commission, adding our recent maximum periodic report on Form 10-K or 10-Q. We assume no legal responsibility to update those statements.
At this point, all participants were put into listen-only mode. The call will be open for questions and comments after the presentation. As a reminder, today’s call is being recorded.
I am now very pleased with your host, David Fischel, President and CEO of Stereotaxis.
fisherman david
Thank you, operator and hello everyone. With me is Kim Peery, our chief financial officer.
We operate in an environment that is still very similar to the one I described on our last call in May. This is a challenging and exciting time for Stereotaxis. The macroeconomic environment continues to be plagued by a multitude of supply chain, regulatory, worker body and similar economic disruptions. to the pandemic.
We saw nearly 70% relief in procedure volumes in China in the current quarter, we continued to see delays in hospital purchasing decisions and structure projects, we have yet to see any progress in supply chain reliability, and we saw inflationary pressures on various expenses. The outlook for our monetary effects for the quarter reflects those challenges, namely delays in hospital structure, with negligible formula gain identified in the quarter, contributing to a decline in profit compared to the current quarter last year.
Despite those pressures and the poor outlook for our monetary results, Stereotaxis is making significant progress in business and technology. I am satisfied with our progress and confident in myself about our position and the way forward. technology; we are advancing in a line of transformative innovation. We assemble a leading sales team and do all of this while maintaining stability and monetary strength.
Let me first tell you about our retrospective advertising performance. During the current quarter, we got 3 orders for Genesis systems, adding two since the last call. Two orders are upgrade cycle systems where Genesis will update outdated Niobes in existing hospitals.
The third order is exclusive and exciting. A visitor to the existing hospital already operating a successful robot PE program to identify a robot lab at the moment in the same hospital. This is a prestigious hospital run by a key ideas leader in the field, and will be the first PE program in the United States with two of our robot systems.
Our continued genesis order speed bodes well for long-term monetary results, as we now have over $12 million in back orders for shipping, installation, and conversion into profit. Although the timing of earnings popularity is beyond our control and depends on the structure of hospitals, orders in our order eBook are necessarily guaranteed with a conversion rate of over 99% and giant non-refundable down payments, giving confidence in their realization.
Our efforts to increase capital sales are accompanied by an ongoing commitment to the good fortune of existing robotic practices and the progression of the holistic business infrastructure that is that good fortune. Two highlights of the current quarter come with the start of an additional cohort of fellows in our Robotic EP Fellows program and the publication of the special factor robots in the Journal of Atrial.
11 electrophysiology fellows graduated from our fellows program in the last quarter. We expect to graduate 19 this year and in total, 65 fellows have graduated from our international program since its launch. These fellows constitute the long-term fund and contribute our generation with appreciation and confidence, which bodes well for us in the long run.
The clinical literature framework supporting the clinical price of robotics and PE has also grown particularly with 16 peer-reviewed publications included in a special factor of the Journal of Atrial in June. The publications covered a wide diversity of topics, adding the use of our generation across the arrhythmia spectrum and in several other cutting-edge tactics throughout preoperative imaging and interoptive mapping, without the use of X-rays and remotely over long distances. We continue to see the quantity and quality of clinical knowledge in our generation as a foundation for long-term adoption.
The maximum effect on our advertising functionality in the medium and long term continues to be the implementation of Stereotaxis’ strategic innovation plan. As a reminder, our innovation strategy is based on five key pillars; a cellular formula that allows a wide accessibility of robotics; our own independent portfolio of ablation catheters; gadgets that bring our generation closer to new endovascular indications; China-specific product ecoformula; and a virtual platform for extensive operating room connectivity. Each of them will serve separately as really extensive expansion engines that will eclipse our existing business, however, the five efforts are also synergistic and together serve as a commodity ecoformula in our project to reshape endovascular surgery with robotics.
A month ago, we were pleased to announce the CE mark presentation of our patented MAGiC robotic navigation ablation catheter. MaGiC’s presentation reflects the culmination of abundant design, development, production and testing efforts, and I would like to congratulate the many other people who have contributed to this effort.
The submission was made on time with the schedule we provided earlier this year and complies with the strictest recent MDR regulations in Europe. Although the timing of catheter approval is not known at this time, we are preparing for advertising by receiving ce marking at the end of the year. The catheter design is based on nearly 20 years of experience and learning from the progression of the existing Biosense magnetic catheter and we are very pleased with the clinical, advertising and strategic benefits that MAGiC will bring.
Beyond the significant milestone with MAGiC, we are methodically advancing the other technology pillars of our innovation strategy. These are making progress in opposition to supply chain challenges, the COVID quarantine in China, disruptions and regulatory distractions caused by MDR in Europe. Despite this, they are still making plans for an initial launch of the cellular robot at this time next year, as it is realistic and the electronic hardware and software facet of the formula is progressing well.
The collaboration between MicroPort and Stereotaxis continues to progress well and we envision a full ecosystem of products in China, which will meet in the current part of 2023. The acceleration of the production of consulting cables for the required regulatory testing has been slower than expected in our subcontractor, and we now expect regulatory approvals and an initial launch in the first part of 2023, than at the beginning of the year.
Finally, the submission of an application to the FDA to release a possible IDE runway for the MAGiC catheter is lately finalizing for some animal trials that we hope to complete by the end of the year. Development progress is inherently non-linear, especially in this environment, yet we are satisfied with the scale and quality of the impactful advances being advanced.
Methodical progress on several fronts of our innovation strategy brings us closer to advertising advancement and steady long-term earnings growth. As our generation line becomes less risky and closer to market, we are paying greater attention to the position of the right sales team. infrastructure and processes to drive truly broad earnings growth.
I am very pleased to be able to announce last week that two very fun and successful business leaders are joining Stereotaxis. Frank Van Hyfte and Tim Glynn bring decades of significant and highly applicable experience to Stereotaxis. They have developed corporations like ours by an order of magnitude and have reveled in the complexity and immediate speed of new pioneering markets.
Their skills and geographic concentration are complementary and complement and complement our business leaders Michael Tropea and Casey Payne. The fact that we have been able to place leaders of this caliber to enthusiastically subscribe to us is a testament to the opportunity and corporate commitment we have. we are building. I am personally grateful to have those business leaders as partners on our journey, and I am encouraged by the fact that their leadership will advise our business activities.
The pieces of the puzzle are beginning to combine in the tech ecosystem and in commercial organizations. Our progress on both fronts supports a truly extensive long-term expansion in the structure of the electrical body and, more broadly, in endovascular interaction.
Kim will now provide some feedback on our monetary results, and then I will also make some monetary comments before opening the call for questions and answers.
kim peery
Thank you David and good morning everyone. Revenue for the current quarter of 2022 totaled $6. 2 million. This figure is down from $9. 1 million in the current quarter last year, basically due to the popularity of revenue in a partial robot formula this quarter, compared to two formulas last year.
Recurring revenue for the quarter was $5. 6 million, to $6. 1 million in the current quarter of last year, reflecting headwinds and procedure volumes and some relief in revenue from services such as hospital technique replacement cycles.
Gross margin for the current quarter of 2022 was 76% of earnings, with a formula gross margin of 16% and a recurring gross profit margin of 83%. Expenses consistent with the quarter’s of $9. 8 million included $2. 7 million of non-cash inventory reimbursement. expenses, inventory repayment expenses. Expenses adjusted or consistent with current expenses were $7. 2 million, according to the same quarter last year.
Operating loss and net loss for the current quarter of 2022 were $5. 2 million, compared to $3. 4 million and $1. 2 million a year earlier. compared to a negative of $0. 6 million and a positive of $1. 6 million in the prior-year quarter.
Negative loose money for the current quarter was $1. 8 million, compared to $0. 1 million in the current quarter of last year and $1. 2 million in the current quarter of 2020. As of June 30, we had money and money equivalents of $35. 1 million and no debt.
Now I’m going to call David.
fisherman david
Thank you, Kim. Je sought to raise a few more comments on two key issues, the earnings forecast for the rest of this year and our balance sheet and monetary stability.
On the first issue, we reported earnings this quarter as a vessel in our performance. Our formula ordering speed and existing formula buildup of over $12 million help our previous guidance for formula earnings and overall earnings expansion for the year.
If we could install all the formulas in our order book, we would expect around $15 million in formula sales for this year. .
We have noticed significant variability in those schedules, with hospital projects delayed much longer than our clients had originally anticipated. These delays in the structure of the hospital have brought the threat that a sufficient component of the order book will not be identified this year and instead next year. introduce caution in these guidelines.
Since all orders in our order book will be delivered eventually, such delays will lead to an expansion of profits in the coming year. Significant delays related to capital purchases and hospital structure make our strategy important to making robotics widely appropriate through logistical and structural complexities. Discussed above, based on our current progress, we expect the availability of advertising from our cellular robot until the middle of next year.
With regard to monetary stability, we are fully aware of the evolution of macroeconomic considerations and the option of prolonged periods of economic and capital market pressure. Our commitment to managing stereotaxis in a disciplined and prudent manner in monetary terms has been very useful to us in this environment.
Recent inflationary pressures have begun at various prices of supply, services and transport. We try to mitigate price buildup and generally remain confident in our monetary position and our ability to manage the business with a controlled and smooth entry as we invest. for growth.
While we had above-normal use of money in the early part of this year, this was largely due to higher stock expenses and one-time prices similar to those of building our new headquarters. We expect continued investment in inventories in the current part. of the year, but I expect to end the year with about $32 million in money and debt-free. Our activities normalized or consistent with the current ones to have a money inflow rate of approximately $1 million consistent with the quarter. This monetary prudence combined with our strong balance sheet puts us in a comfortable position to continue advancing our strategy autonomously without the need for additional funding.
I have said the poor symbol of our economic performance, but I see this along with confidence that our basic progress is significant and that our position is strong. We have a constant demand for our technology. We are advancing a portfolio of transformative and multi-impact inventions for launches in 2023 and beyond. We assemble a leading sales team and we must do so while maintaining stability and monetary strength.
We look forward to answering your question. Operator, can you open the line for Q?
Q&A session
Operator
Surely. [Operator Instructions]. And now let’s take Josh Jennings’ first with Cowen. Please continue.
jose jennings
Hello! Thank you for answering David’s questions. It’s wonderful to see new formula orders this quarter and our controls suggest that the demand for robotic navigation is increasing. I was wondering if it could help us think about the sales funnel, the replacement. channel and the Greenfield channel when we are here today and compared to the beginning of the year.
fisherman david
Hi Josh!Hello! So we continue to advance the infrastructure to manage a sales channel. I think on the last call, we talked a little bit more about this new infrastructure that was being built and is now operational in the U. S. It is operated outdoors. TO US.
Overall, the sales funnel looks smart. I don’t think there’s much difference to the kind of feedback we gave earlier this year, where we said we had a few dozen, a few dozen, more than a few dozen systems in the works. But we have more, there’s higher data quality now that we have the advanced capital sales pipeline infrastructure and overall we still see an intelligent diversity of replacement cycles and Greenfield systems in that pipeline globally and we’ve worked on them.
I think, as you say, the speed of orders that we’ve had is broadly in line with a direction that would drive expansion this year and drive it in the years to come, but we can also increase that speed at any time. time.
jose jennings
Merci. I only think of the controls attached to. . . well, right now the robotics lab in one of their visitor centers. I mean, our feeling is that the center is a component of a giant hospital network. And I know we’ve talked about that before, a little bit of the last earnings call as well. But alone, could you remind us how you and your sales position yourself, your sales team attacks IBM and any other main point you can percentage on the resolution of this EP lab to build a moment?robotics laboratory
fisherman david
Of course. So you’re right. It’s a good guess that it’s the hospital that has an intelligent old experience with our system. This is part of the big concept and in the United States and decided, based on this experience, to buy an instant robot.
And overall, I would say that, obviously, the explanation for why they followed a formula for the time being is that they have reveled in the clinical price of our generation and with the economic price of the hospital of our generation, allowing them to treat patients who in a different way may simply not treat and improve the potency of the formula. It was very good before this year to do a stopover at the hospital and the head of the cardiovascular facilities line was talking very well about how, when you look at all this data, how our formula has made complex oblations much more effective and reduced the variability and delays of those procedures. so this guy was actually a vote of confidence, not only from the doctor, but also from the directors there.
From IDM’s perspective, we have enough experience in the field, from a clinical knowledge and hospital economic price perspective, to have meaningful conversations with larger IDNs; to have a dating that further disseminates robotics through an IDN and shows that there is price and not only when you follow robotics from back to top, but also from the most sensitive down.
These discussions are noticeably broader, strategic for selling discussions, and therefore it is difficult to know when or how they will evolve. But in fact, we have those discussions and we think at some point it makes a lot of sense for an IDN. So I hope that at some point we can update you more.
jose jennings
Thank you very much David. I’m grateful to you for that.
fisherman david
Thank you Josh.
Operator
And the next one comes from Adam Maeder with Piper Sandler. Continue.
Adam Maeder
Hello David!Hello Kim! Good morning and thank you for responding to inquiries. Maybe just to get started, an explanation query about the cellular MRI system. I think I heard they were expecting a release through the U. S. In the U. S. and the OUS, I just wanted to explain that. And then just communicate where we are from a design perspective. We design a lock and a point of trust just to meet deadlines, and then I have one or two follow-ups. Thank you.
fisherman david
Of course. Hello adam!Hello!So, you answered your question a little bit. I think I understood well kindly, but if I am wrong, kindly. We talked about where we are lately in the progression process, feeling confident that we deserve to be able to have a release right now next year. I would say it would be in one of those two main geographical spaces, at least Europe or the United States, so I guess the two geographical spaces would be relatively close. each other, so in a few months, a few months apart, at least one of them deserves to have a release in the middle of next year.
And in general, from the point of view of progression, again, there is the mechanical aspect, the electrical aspects, the software, the user interface software, so there are other parts that want to join. There have been all sorts of demanding situations along the way, especially in the aspect of the source chain, in the electronic aspect and also in the aspect of mechanical hardware. But, in general, the pieces fit together.
We haven’t started testing a formula yet, but we’ve made a lot of progress and overall we feel very smart where we are and we’ll start VNV[ph] testing before the end of the year and we’ll have been. to submit for regulatory approval at that time, and that will be a kind of timeline that we’ve reported from a mid-year launch.
Adam Maeder
It’s a very useful color David, thank you for that. And then for the next consultation, only on the MAGiC RF ablation catheter. You know, I heard the message about the planned deadlines for Europe and the launch there, but I wanted to ask. a query about how far away it is in the U. S. market. Do you know precisely when you think the U. S. IDE test can begin?USA? Everything you can share about the test design right now and ultimately what we think about a possible approval of this technology in the U. S. USA? Thank you.
A-David Fischel
Of course. So the European presentation required a massive corpus of tests, these kinds of bench tests, lab tests and it required total diversity: I mean dozens of animal studies and it didn’t require human studies. This will require a post-approval examination in the EU. In the United States we have all those same needs and the vast majority of the CE marking dorcei [ph] will be the same or almost the same for the presentation of American FDI and so everything is explained and ready.
We have a few, a dozen additional animal studies that have been requested through the FDA, plus a few dozen studies that we’ve submitted for European submission and those animal studies require some kind of follow-up period, relatively short, but it’s still a follow-up era, so we built: to conduct those studies, we’ve developed our own animal testing capability and that’s really, it’s the only thing that’s known to be able to complete those studies and send the IDE to the FDA. Therefore, we plan to complete those studies before the end of the year and be able to file the FDI type without delay after that.
We’ve had several conversations with the FDA so far, so we have a pretty transparent understanding of what the trial design deserves to be and I would expect, say, about 150 patient studies in an express clinical indication, an express type of arrhythmia with short follow-up, maximum follow-up of 3 months.
And since this is a very common arrhythmia, given that we have an installed base of users and the catheter can only be used with the Niobes or Genesis system, so we can literally take advantage of our fully installed base there. I think this is an essay that deserves to go in very temporarily once we get the IDE approval and we can start the study, the registration and follow-up deserve to be done very temporarily.
Adam Maeder
Okay, great, it’s a very useful color, and if you don’t mind, I’ll see if I add one more. You know, I saw it in the — I think in the press release, there were comments about you knowing about the industry trying the infrastructure and the progress that’s being made in it and laying the groundwork and you know, traditionally it’s been very judicious and conservative with spending.
But I also think in the afterlife he talked about the launch of the MAGiC catheter as an incentive to “not go on the offensive anymore,” and you know, I know we’re not there yet, but you know you’re wondering what’s next. the plans are for advertising infrastructure and team building. Any additional color you can provide will be greatly appreciated. Thanks back, David.
A-David Fischel
Of course. So, yes, I think we’re surely right: we take seriously our commitment to running the business in a financially sound way and I think that kind of: this field generates a lot of price for Stereotaxis and ensures that we don’t waste shareholder price and capital, and so, however, now this eco-formula of products is starting to come in combination and, Obviously, the catheter, but also the cellular formula and the diversity of technologies that come in combination, this clearly justifies that we focus more on the sales team and how to make sure they have a wonderful sales organization. And so, with this kind of evidence, Europe is going to be a domain of specific interest given the launch next year.
Establishing the right leadership is the first step in this direction, and as we begin the launch and complete it, I would expect a fairly extensive build of our European sales team. Again, I think given the construction in profits consistent with the procedure that the MAGiC catheter provides, it will be enough: from a monetary standpoint for the company, a very low-risk equipment structure, because you can do that very goes hand in hand with the adoption of the MAGiC catheter for Express, so you can do some kind of laser-directed and laser-directed contracting, where there’s a maximum return on investment for every rental, so I think you’ll probably see us over the next year doing pretty extensive construction. , consistent with perhaps even a doubling of the European team.
Adam Maeder
Thanks for the color David.
A-David Fischel
Gracias.
Operator
And the next one comes from Neil Chatterji of B. Riley. Continue.
Neil Chatterji
Hello! Thank you for answering the questions. Maybe I’m just going back to the surroundings of the hospital structure, I’m just curious that you know that we are aware of about a month in the new trimester. I’m a little curious about whether you see symptoms of improvement here in July and now in August, and then also if it’s a way to potentially characterize the barriers to conversion that you would see for overdue systems, you know, for example, or some projects similar to larger hospital structures.
fisherman david
Of course. So hello Neil! So overall, the feedback we’ve given today is updated, so we keep seeing delays in construction hospitals where even you know that some of the orders we won expired last year, is where we would have expected to install systems around. now. We still don’t know if we’re going to deliver the systems in a few months, a few months or if it’s going to take longer. So, there’s a kind of. . . a lot of uncertainty and just one kind of delay in terms of our hospital consumers and their own laboratory construction processes, to organize themselves to be in a position to be installed.
So, I would say it’s still a pretty messy world, and next to it, your query at the moment that asked about the uncertainty with conversion, and since I didn’t know if it was a bit in terms of the timeline of when an order or an e-book of orders would be changed to profit or the threat in general terms, it would be changed to profits. Could you explain that exactly?
Neil Chatterji
Yes, I mean only in relation to the environment of the structure, so just in terms of: are some of them similar to larger structure projects where you already know?Because it is a larger project, it delays it even more than if it were just the reconversion of the EP laboratory.
fisherman david
Yes, it’s a combine and there are some where you have full or full wings, you know, full eruptions of a hospital floor. So, those are kind of a component of a much larger task and others may be just this lab. But what do you see is that there may be 8 labs in some kind of cardiovascular wing of the hospital and the hospital will just go from lab to lab. So they make the first lab. When lab one finishes, they go on to do lab two, when lab two ends, they go to lab 3 and we can be lab anything along that lines, and just as it has, any delay it has starts having an effect like a domino effect, labs after them and that’s right, it’s a pretty common scenario.
Neil Chatterji
Understood, understood. Maybe if I can upload some other query here. So, I’m just curious to shift gears for the possible launch of MAGiC in Europe, I’m just curious to know what your expectations are as far as how sites can make a temporary transition to MAGiC, adding any regional nuances you want. I could see there.
A-David Fischel
Of course. So, there is an obvious range. I think there will be a kind of purely logistical and legal capability to launch. Once the CE mark is in some countries, it can be introduced almost without delay. We will have to have a hospital contract to buy the product, however, it deserves to take place very, very temporarily and we can be the first to conclude those agreements almost without delay after ce marking, so it is simple from a logistical point of view.
While in some countries, especially the Nordic countries and France say, and there are tenders, you know the national tenders or regional tenders that you must enter. So, you can sell a safe amount of an approved product outside of the RFP as new: under new generation clauses or other things, however, you can’t continue with full adoption, the full transition of a site until you approve that RFP. So, this logistical facet will mean that in some countries, some accounts that you know there will be, there will only be a partial adoption for the first option, until it triumphs over those tenders, which can take between six months and a year after the CE marking process.
But again, in other hospitals, let’s say especially in the Netherlands, Belgium, Germany, some other countries in Europe, there are actually no logistical obstacles once you have the CE mark. And the other kind of genuine effort that we’re going to have to succeed is that some doctors will be motivated and excited to be the first in the world to use it and will be kind of pioneers in this effort, while other hospitals, I’m sure other doctors will need to see that one of their peers first treated 10 instances of arrhythmia A or arrhythmia B and has smart effects and will need to be able to speak. with this doctor, then on the basis of who will be comfortable looking for it themselves. Therefore, it is a type of general variability in the dynamics of doctors.
I think we’re running our aspect as an organization to make sure there’s a business plan considered for each of our 30 hospital accounts in Europe, where we think about what the drivers of adoption are, how we design the method that, individual doctors, how we use the hospital as an account, if there are logistical aspects, how do we know exactly what application and what bureaucratic and logistical procedures we have to go through to enter the account, then I think we are moving to Be ready. That is, our role is to be ready, so that when we get approval, we can move forward with the greatest success and consideration imaginable in this whole process.
Neil Chatterji
Super! Thank you for that. I’m going to get in the queue.
A-David Fischel
Gracias.
Operator
And now let’s respond to the next one from Craig-Hallum Capital Group’s Alex Nowak. Continue.
alex noak
Super! Hello everyone. I hope to expand the structure factor around hospitals, but maybe communicate about the CapEx environment in hospitals. What is your willingness to go there and place orders right now, especially if you see those delays in structure projects?I know that some colleagues see a recovery, others not so much. So, just the current state of the CapEx for the capitalization lab.
A-David Fischel
Of course. Hello, Alex! Therefore, in general, we still receive orders at a relatively normal rate. We see a portfolio of interested hospital clients, so I would say he’s right. however, at some point they have to place an order and there may be delays even after that, beyond what they thought were the delays they expected.
So, I mean there have been delays in orders due to the dynamics of the structure in hospitals. But at the end of the day, the world is still working, hospitals are still functioning, they still want to modernize the labs, they still have to build new labs, so those delays have an effect on the planned order. But commands need to be executed and sadly infrequently run and there are still delays after that, and waits. on the sidelines to be able to deliver and install. But again, it’s actually some kind of programming problem, not an “if” problem, so we’re sitting here and doing our best given that environment.
alex noak
Yes, understood. And then maybe about maGiC’s real-world study in Europe. What will it look like, how many patients, the follow-up time and if there is an express number of other people chosen or will it necessarily depend on demand?
fisherman david
And so will be the post-market examination in Europe, this will be explained more clearly in our conversations with the notified framework in Europe over the next few months, I guess, as we get questions, so we have proposed to them a type of examination of the design. In general, again, I wouldn’t use it: it will be in a wider diversity of arrhythmias, probably in a few hundred patients overall. We will be able to do this across a wide diversity of our site in Europe and overall we believe it will be a smart test to build a relatively broad kind of knowledge about catheters in Europe given that it is a kind of subsequent approval. Obviously, there is a little less tension in that, however, it will obviously be vital for us. to be able to carry out this test and show that there is a price for a wide variety of arrhythmias through this test.
alex noak
Ok, I get it. And just to finish, just a clarification. What is the delay of the formula at this time?I think $12 million, $1. 5 million consistent with the formula more or less, just by the number.
fisherman david
George, that’s over $12 million in formula accumulation. It’s a little confusing to describe it as an accurate formula, because you’ve seen, let’s say in the current quarter, we reported earnings on some kind of component of the formula. we have both, the X-ray component, the robot component. There’s also a big-screen demo component, so we have hospitals where there’s a combination of that kind of thing at stake, but all in all, yes, it’s kind of. . . is an average of a number of single-digit formulas that come to that. Again, it’s based: there are component formulas where we ship one of the portions but not the other component and therefore it’s a kind of component shipping.
alex noak
I see, I understand. Fine thank you.
Operator
Now we’ll take the next one from Frank Takkinen of Lake Street Capital Markets.
Please continue.
franck takkinen
Hello David! Thank you for answering my questions. I sought to know a little more about the replacement combination compared to Greenfield. You provided color around the funnel and I think I heard dozens of them. Maybe it just communicates what the combination of a replacement looks like compared to Greenfield and then how do you expect that to evolve in the future?
fisherman david
Of course, hello Frank. So, overall, it’s a clever combination between the two; I think it’s a homogeneous combine, and when we look at the pipeline at a complex stage, I think there’s more and more: the replacement cycle we’ve talked about in the afterlife is becoming more and more real. in the effects of the last trimester. You’re probably expecting it in-kind effects for the coming quarters as well. In fact, there’s some sort of: some of those replacement projects are underway and so we’re seeing some of them come to fruition. .
Having said that, I would say that obviously, from a basic standpoint, the company that is driving Greenfield adoption is valuable, so we’re focusing more and more on that, and we still have a diversity of Greenfield hospitals in the pipeline. And so I think I see a mix, however, I would say that at least in the very complex pipe, it’s probably more oriented towards the replacement side.
franck takkinen
Well, that’s helpful. And then, maybe just an update on usage. I know that some of the newer sites trend higher than some of the legacy sites. So maybe any color you can provide about quarter usage and trend.
fisherman david
So if you exclude the Asian-type dynamics in the last quarter, overall the usage has been: I no longer have the precise figures for the Genesis services or the new Greenfield services that we just had since the beginning of this year. But overall, usage remained very smart and above average in the current quarter, so we’re very pleased with the way the Greenfield and Genesis System sites are being used.
I don’t know if anyone on the call had the chance. The new launch we had in Warsaw in the first quarter, at the end of the quarter of the moment, they held a convention in the hospital. Two of the live instances, two I Think of the 4 live instances of that convention that used our technology. They had a comment at this convention where they commented on how inspired they were with the system, how they used it in the total diversity of arrhythmias. And overall, I would say the delight on our existing sites, like the new releases on the Genesis sites, overall, was very enjoyable.
And so it is, and other than that, I would say that the overall usage is still relatively solid. it has obviously been a bright spot in the matter, a kind of solid general basis for the company to support itself.
franck takkinen
Well, that’s useful. I will prevent there. Thanks for answering my questions.
fisherman david
Thank you Franck.
Operator
And now let’s take Nathan Weinstein’s next one with Aegis Capital. Please continue.
nathan weinstein
Hello David! Good morning and thank you for answering my questions. These questions relate to the pillars of innovation. Basically, can you remind us from your point of view what are the main endovascular contiguities that could be the hottest for stereotaxy?And then secondly, any update on China’s specific product ecosystem and is this again a hot opportunity in your opinion?
fisherman david
Hello Nath! Hello. Of course, let me deal with both. So, from a finishovascular intervention and a type of contiguity to what we do in electrophysiology, this is clearly one of the great pillars of our growth. I believe our technology, robotic magnetic navigation, the concept of moving final vascular devices from their distal end and, in doing so, enables precision, safety, diversity and stability that is not otherwise imaginable with a manual catheter. I think it’s kind of inherently has a lot of benefits in a total diversity of finishovascular surgeries.
When We R
I think in situations like neurointervention, where you have a complex anatomy, a sensitive anatomy, there is a significant unmet medical need, with many patients not receiving any treatment or not receiving the treatment that would benefit them. These are: spaces where I think we can bring a lot of value.
But again, those were kind of five critical spaces in which we have our site. The others outside the doors of neurointervention are interventional cardiology, peripheral artery disease, AAA transplants, and cancer embolization. those five sites where we have our sites right now, and we’re bringing in the right set of equipment to handle it, I think I see, hopefully, in the first year or so, a diversity of clinical literature dealing with a lot of other clinical specialties.
On the China side, evidently, the disruptions and quarantines explained in the current quarter were not very important for overall growth, but it was very impressive. of this kind of ecosystem of products that we are creating in combination in China.
Again, the product ecosystem notoriously includes regulatory approvals for our robot and X-ray system, and the integration of mapping with Microbot’s mapping system, and then a diversity of ablation and prospective diagnostic catheters also in China, bringing the MAGiC catheter there, the progression of various Microbot catheters, and a lot is happening in this collaboration.
And overall, we’re very pleased and very pleased to see how well this collaboration works in combination. The way we spread a diversity of advances in a diversity of technologies in combination there and I think this smart ecosystem comes in combination. As I said in the comments ready, it will be had at the time part of next year.
Probably other facets of this ecosystem will enter and be available at other times. But this kind of meeting, I think the moment we start to be closer to the end of next year, we start to see. this kind of thing comes into play and that’s actually when you can start to get advantages from organizing vital exposure microbots to drive some sort of wider adoption through a fairly large sales team.
nathan weinstein
Super! Thank you David.
Operator
The next one comes from Javier Fonseca of Spartan Capital. Continue.
Javier Fonseca
Hello! Thank you for taking my inquiry. I have a quick inquiry about capital sales. So, with the underlying demanding macro situations we’ve noticed so far in 2022, how has the overall business strategy of the newly installed formula changed?formula, there is demand. But you know, in the face of all those demanding situations, you know that there have been adjustments in the overall strategy.
fisherman david
Hello Javier! So no, I don’t think it’s a genuine replacement in the overall strategy. As the overall strategy is obviously, we have a generation that brings a lot of value. We still have a very small market place percentage, less than 1% market place percentage of marketplaceplace electrophysiology alone.
I think the clinical price and price of the healthcare formula we offer is that it’s a particularly high market percentage in electrophysiology, so we’re doing the right thing commercially to get a fair percentage of that market. And then, in tandem, obviously, make the strategic inventions that allow us to be followed much more fluidly in the existing configuration of the product, which requires structure because it provides us with our own exclusive disposable product, giving us the opportunity to build sales groups in another way, in a much more really extensive way and reaching the technological ecoformula, so that we can be used in clinical programs and not only in electrophysiology. So I think this strategy is very well established and we continue to promote it.
Javier Fonseca
Okay, thank you very much. No supplementary questions.
fisherman david
Thanks javier
Operator
And we have a follow-up of Josh Jennings with Cowen.
jose jennings
Okay, David. Thank you for following up, David and Kim, sorry.
I just wanted to make a query about the neurovascular indication. I mean, since Innovation Day in December, it’s been several months. I’m sure you’ve interacted with some neurovascular companies, some neurosurgeons and I just wanted to hear from you what kind of feedback you’ve received. Are there any main points about which doctors to use in the clinical pricing proposal, and then their internal teams, I guess, at the point of optimism. Sure, it went up over the seven months, but if you can just percentage that, that would be great And I think you’ve provided some components of the response already provided in one of the previous queries. I appreciate the follow-up.
fisherman david
Of course, in the quarter of the moment, we received two neurosurgeons from two other hospitals who came here to St. Louis and they were working with us, with the devices we developed, with [inaudible].
We’ll probably have a few more visits at the end of the third or fourth quarter, early in the fourth quarter and we’ve done that, we’ve been fortunate to have a pretty passionate organization of prestigious neurosurgeons who have helped us in this development, and overall, I think the kind of clinical cost of having to navigate a tortuous vascular formula is vital in neurointervention. whether you look at us from vasectomy cases, ischemic stroke aspiration cases or if you see liquidation cases for hemorrhagic attack.
There is a great diversity of patients who do not get any treatment or who, when the doctor tries to hit the place he wants the treatment, can fight for 20, 40, 60, 80, a hundred minutes looking to pass. The tortuous vascular system, and this will cause strokes in your brain, so there is a lot of clinical price if you can improve the potency of succeeding at the target site and you can do it safely.
And I think that’s really what motivates those doctors to see that with our tools, they can get results where they couldn’t succeed otherwise or they can get results much more efficiently, much faster, without employing the full diversity of tools. And that’s where the pricing proposition is and I think as we commercialize those tools, that will allow us to start demonstrating that in a clear way in the clinical literature.
jose jennings
Enjoy. Thank you.
Operator
And we have no additional questions for today’s call. I would like to refer the call to David Fischel for any additional or final comments.
fisherman david
Okay, thank you all very much for your questions and for your continued support. We look forward to directing your name in the coming months and speaking with you next quarter. Thanks a lot.
Operator
This concludes today’s appeal. Thank you for your participation. You can now log out.