Q&A - Q4 2023 Quarterly Call

1. 4 reps to be hired in Q1FY24 (currently 6 reps); How many sales reps to get to full US coverage?
2. Estimating 20 to 25 range for sales team. Team will need to be built out across other areas such as support.
3. Now that you have critical mass in Alabama and Michigan how many sites does that equate to in terms of near-term targets?
4. Michigan is 500 to 1000, this is a really strong target market for IPD. One of the largest health systems in Michigan has approached us in relation to a Master Services Agreement for a broader roll out of SOZO over time.
5. Alabama is 300 to 400; 10 to 20m dollar TAM.
6. Rate of growth anticipated; will there be a delay in the demand of the devices?
7. Need more data to be able to accurately forecast the rate of growth that we expect for our system sales to achieve. We think it's going to take a couple of quarters at least to have a direct impact as it s a combination of things. The first national payer got a number of markets to 41,44,50,61,70, 64 and 74% coverage, but it takes getting that market to critical mass (Above 80%) before its a market you can go in and see the complete ROI model.2025 should see 100% private payer coverage and critical mass in most markets, once this occurs, growth should be at its greatest. In the meantime we need to prep for the scale that coming.
8. Do you foresee any issues with being able to make the devices available to to meet the manufacturing and clinical support demand? And do you expect a delay as a site transitions from a standard of care to this new device?
9. We are looking to hire a Chief Medical Officer, Chief Commercial Officer, head of customer success and build out the teams underneath these lead roles; So that we are ready when the demand really starts to increase. Once we learned of the upcoming NCCN guideline update we ensured we were able to manufacture 500 systems on a quarterly basis. We have already ramped up beyond that at this point so from a manufacturing standpoint we are staying well ahed of short term forecasts for systems. Longer term we will use some of the funding secured from the capital raise to secure long lead time parts in order to stay far enough ahead of these so we can manufacture devices quickly.
10. Pricing - What is the pricing per scan for the payers?
11. Medicare rate is $145 nationally; 30-50% of covered lives in a given US state.
12. Private payer between $200 to $220 (USD) per measurement.
13. Policies to date are in excess of this figure, however smaller markets like Alabama are below $200 whilst some payments are over $300.
14. Has there been an increase in the run rate of the scans per month?
15. Last Q there was 56000 total measurements, prior to this there was in excess of 50,000 total measurements per Q for the last three Qs. So no significant increase in the number of patients tested, however, we did not expect this to occur yet. We will be building out the customer success team who will be focused on building out the patient testing as per protocols and getting patients back in for repeat testing to ensure a ROI. Once this occurs the rate of scans per month should increase.
16. The proportion of the sales - any customers upgrading the SOZO to the PRO?
17. SOZO Pro is yet to be commercially launched. 15 new customers in the period this was one of our strongest in terms of quantity of new accounts. One third of NCCN centres transacted with us last Q; 1 new account and the other 10 were a combination of renewing their contracts or expanding their accounts.
18. Implications of silent coverage and what the pathway is?
19. We want positive medical policy that clearly states reimbursement for our technology, however, silent coverage still means reimbursement. It just means the site has chosen not to create a policy. No that we have the first national payor the policies will be coming.
20. How do you reach the 1.1 million people each year who have already had cancer treatments that are susceptible to lymphedema?
21. Our customers will be recommending SOZO to monitor lymphedema for all cancer patients not just the newly diagnosed cancer patients.
22. Customer success teams role in getting the doctors and nurse practitioners to be advocates of SOZO?
23. Whilst we can have an early adopter who's passionate about the technology and wants to put it to use, the challenge is the finance part of the organisation. So regardless even if the doctors and nurse practitioners are advocates unless there is a private payor ROI then the patients themselves may have to be charged. The great news is that with the customer list we already have, we have these evangelists placed in lots and lots of organisations that will sing our praises to the finance department to administration to help us now that we have got a full blown ROI model to sell.
24. The customer success team is going to be part of our commercial organisation so they will report up to our Chief commercial officer (CCO) and will be incentivised to ensure utilisation is increased, and that we continue to expand our footprint in each account. 
25. There is a bit of a disconnect from utilisation at our customer site and our subscription fee because they are separate from one another and they don't pay us on a per test basis. There is lots of reasons for this, and for the time being we will stick with this model but it can cause us to lose sight of the fact that we might have customers that are low utilisers and may not stick around or may not expand if we don't get them utilising more. The new CCO's role is to ensure we are tracking and sharing best practices with our customers to avoid any disconnect.
26. You sold apparently 20 systems outside the US, which countries are the main focus over the next 2 to 3 years?
27. A strong distributor network exists in the Asia Pacific Market, however the average license fee is bout one tenth the amount that we get in the US. This is based on the reimbursement in the US and the lack of reimbursement in the asia-pacific market. The opportunity in the US will continue to be our main focus fur to the sheer size of the market.