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Monogram Orthopaedics (MGRM) - 2024 Q2 - Earnings Call Transcript
MGRMMonogram Orthopaedics (MGRM)2024-08-15 00:48
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Financial Data and Key Metrics Changes - The cash position at the end of June 30, 2024, is 7.3million,withanoperatingcashflowofapproximately7.3 million, with an operating cash flow of approximately 6.4 million for the six months ended June 30, 2024 [3] - The average monthly cash burn is a little over 1million,witheffortstomaintainthislevel[3][4]−Thecompanyhasnotraditionaldebtorwarrantobligationsatthistime[4]BusinessLineDataandKeyMetricsChanges−Thecompanysuccessfullysubmittedits510(k)applicationtotheFDAforthemBo^sTKASystemonJuly19,2024,whichhaspassedadministrativereviewandisnowintheprimarysubstantialreviewphase[5][6]−AstrategicclinicaltrialcollaborationwithShalbyhasbeenestablished,targetingapatientpopulationof102withathree−monthfollow−up[6][7]MarketDataandKeyMetricsChanges−Thecompanyanticipatesleveragingclinicaldatafrominternationaltrialsforpost−launchmarketingintheU.S.andforlaunchinginternationally[7]−TheprimaryaddressablemarketintheU.S.isestimatedat1 million, with efforts to maintain this level [3][4] - The company has no traditional debt or warrant obligations at this time [4] Business Line Data and Key Metrics Changes - The company successfully submitted its 510(k) application to the FDA for the mBôs TKA System on July 19, 2024, which has passed administrative review and is now in the primary substantial review phase [5][6] - A strategic clinical trial collaboration with Shalby has been established, targeting a patient population of 102 with a three-month follow-up [6][7] Market Data and Key Metrics Changes - The company anticipates leveraging clinical data from international trials for post-launch marketing in the U.S. and for launching internationally [7] - The primary addressable market in the U.S. is estimated at 20 billion, expanding to 30billionwhenincludingextremitiesandspine[26]CompanyStrategyandDevelopmentDirection−Thecompanyaimstoscalerapidlyininternationalmarketswithlessworkingcapitalconstraints,whilealsopreparingforameasuredgrowthtrajectoryintheU.S.[7][12]−Thefocusisonbuildingarobustclinicaltrialdatasettosupportmarketentryandtovalidatetheproduct′seffectiveness[17][18]Management′sCommentsonOperatingEnvironmentandFutureOutlook−ManagementexpressedconfidenceintheFDAapplicationprocessandthepotentialforafavorableoutcome,emphasizingtheimportanceoftheupcomingdecision[5][9]−ThecompanyisoptimisticabouttheIndianmarket,citingitsestablishedinfrastructureforclinicaltrialsandthepotentialforsignificantsalesgrowth[24][26]OtherImportantInformation−ThecompanyplanstocloseitscurrentofferinginearlySeptember,withsharesofferedat30 billion when including extremities and spine [26] Company Strategy and Development Direction - The company aims to scale rapidly in international markets with less working capital constraints, while also preparing for a measured growth trajectory in the U.S. [7][12] - The focus is on building a robust clinical trial data set to support market entry and to validate the product's effectiveness [17][18] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the FDA application process and the potential for a favorable outcome, emphasizing the importance of the upcoming decision [5][9] - The company is optimistic about the Indian market, citing its established infrastructure for clinical trials and the potential for significant sales growth [24][26] Other Important Information - The company plans to close its current offering in early September, with shares offered at 2.25 [15][21] - Management highlighted the competitive landscape, noting that Monogram's technology is unique compared to existing robotic systems in the market [29] Q&A Session Summary Question: Clarification on FDA submission timeframe expectations - Management clarified that the current substantial review period takes 60 days, and the FDA's average decision time is about 128 days [9] Question: Relationship with Shalby - Shalby is supporting the clinical trial and is seen as a strong partner in the Indian market, with ambitions for international growth [10][11] Question: Future cash needs and fundraising - Future cash needs will depend on the ability to execute milestones, with expectations of enhanced capital appetite as milestones are achieved [13] Question: Sales initiation post-FDA clearance - Sales ramp-up will depend on the market, with expectations for quicker market entry outside the U.S. compared to the U.S. [16] Question: Competitive landscape - Monogram's technology is positioned uniquely in the market, with a focus on active robotics, differentiating it from competitors like Mako [29]