Stereotaxis Inc

AMEX:STXS

Earnings Call Transcript 2024-Q3

[Operator]

Good afternoon, and thank you for joining us for Stereotaxis Third Quarter 2024 Earnings Conference Call. Certain statements during the conference call and question-and-answer session period to follow may relate to future 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 risks, uncertainties and other factors, which may cause the actual results, performance or achievements of the company in the future to be materially different from the statements that the company executives may make today.

These risks are described in detail in our public filings with the Securities and Exchange Commission, including our latest periodic report on Form 10-K or 10-Q. We assume no duty to update these statements. [Operator Instructions] As a reminder, today's call is being recorded.

It is now my pleasure to turn the floor over to your host, David Fischel, Chairman and CEO of Stereotaxis. David?

[David Fischel, executive]

Thank you, operator, and good afternoon, everyone. I'm pleased with our performance this quarter. We demonstrated solid commercial execution, successfully closed and integrated the APT acquisition and are advancing in parallel a broad range of innovation and regulatory efforts that are strategically transformational. On our last call, I provided significant commentary on our innovation strategy and APT.

I'll keep today's remarks relatively brief with just to focus on the key updates. Kim will then share our financial results, and we'll open the call to Q&A. Our revenue growth in the third quarter was predominantly driven by partial revenue recognition of 3 Genesis systems that were delivered to customers late in the quarter.

All 3 were delivered to European hospitals, 2 of which are upgrading their existing robotic labs to Genesis and one of which is establishing an entirely new robotic program. As has been our custom, we will announce Genesis launches in coordination with each hospital as they treat their first patients. Our pipeline of Genesis customers remains robust, and we received orders for 2 additional Genesis systems in the third quarter.

The combination of these incremental orders and system revenue left us with a capital backlog of $15.5 million at the end of the third quarter. We continue to see an active pipeline of interested customers in Genesis and expect to continue to receive orders in this and coming quarters. The recent CE mark for GenesisX has allowed us to start to build a pipeline of GenesisX customers that incrementally adds to our robotic opportunity. This GenesisX pipeline will ultimately dwarf our Genesis pipeline.

While we have not yet received CE Mark approval for the MAGIC catheter, which is key to the launch of GenesisX, we expect it in the near term. at around a similar time as that milestone, we expect to receive our first GenesisX system order. We are very excited to start to see the impact GenesisX will have on patients, physicians, hospitals and on our overall growth trajectory.

Our capital results have been predominantly driven by Europe, where we have the most advanced product ecosystem coming into fruition. With regulatory approvals in the United States and China slightly behind Europe, we look forward to those geographies increasingly contributing to our capital orders and revenue. Our robotic system orders have also historically remained fully driven by the electrophysiology specialty.

In the coming year, as we introduced the first vascular catheters and guidewires, we look forward to starting to receive orders driven by a broader array of specialties. Recurring revenue in the third quarter benefited from the partial quarter contribution of catheter revenue from the acquisition of APT.

This contribution was approximately $0.5 million in the third quarter and will be larger in the fourth quarter. We are excited by the positive reception to APT's catheters from our customers in the community of robotic electrophysiologists. We expect meaningful sequential revenue growth from these catheters in the fourth and subsequent quarters.

I described on our last call, the clinical and commercial synergy as well as the commercial strategy with these differentiated catheters. I'm pleased that the early months following the acquisition continue to validate the synergy and strategy. While the addition of APT is supporting a return to growth in recurring revenue, our largest recurring revenue opportunity remains ahead of us with regulatory approvals and commercial launches of robotically navigated ablation and mapping catheters and vascular guidance catheters and wires. That segways well into updates on our innovation strategy.

We are aggressively driving broad-based progress across the late stages of a comprehensive innovation strategy. The MAGIC catheter, our proprietary robotically navigated cardiac ablation catheter is close to receiving European CE Mark approval. During the third quarter, following our earnings call, we received questions on the last outstanding area of review, microbiology. We responded to those questions, received a second round of brief clarification questions, and are awaiting final confirmation that our microbiology review has been completed.

We should receive CE Mark for MAGIC shortly afterwards. We are very much looking forward to approval and expect significant commercial adoption of MAGIC given our clinical experience in the ongoing European study and the positive feedback we received from our community of robotic customers. In the U.S., FDA is continuing its review of the MAGIC PMA submission, and we continue to have collaborative and thoughtful dialogue. We have aligned on an expected indication for MAGIC and the data that should support that indication.

The ongoing dialogue supports our expectation of achieving an initial regulatory approval, leveraging the data being generated in the ongoing European MAGIC study with a clear plan for subsequent post-approval studies in the U.S. We appreciate the collaborative nature of these discussions and believe they are reflective of a shared appreciation for the importance of ensuring MAGIC becomes available patients and physicians who depend on it.

Beyond MAGIC, we made significant progress with what will be the first-ever robotic high-density mapping catheter and vascular guidance catheter. Both of these catheters were being advanced with APT over the last couple of years and completed development around the time of the acquisition. During the third quarter, we manufactured the hundreds of catheters needed for formal regulatory testing and expect to complete all testing within a couple of months, setting us up for regulatory submissions next quarter in early 2025.

Both catheters provide significant value clinically, commercially and strategically. Some very recent anecdotal color on the interest in these 2 catheters may be helpful. I have the opportunity to meet with dozens of our customers at the Society for Cardiac Robotic Navigation annual conference 2 weeks ago in Portugal.

Immediately after that, I visited physicians at one of the most prestigious and globally well-respected EP centers in France. At both the conference and at this prestigious hospital, there was significant focus on the importance of mapping and how our robotic mapping catheter addresses a primary barrier to physician interest and use of robotics. The French hospital viewed our emerging comprehensive product ecosystem and the mapping catheter in particular as highlights warranting reassessing the impact robotics can have on the field.

Following the meeting in France, I visited London, where I had the opportunity to meet amongst other activities with nonelectrophysiologists to explore initial uses of our robotic guide catheter and guidewire. We identified several new indications with unmet medical need for our overall approach and guide catheter specifically can improve care and add value. We are excited by how the mapping and guide catheter can boost adoption of robotics in EP and initiate adoption in the broader endovascular field.

I want to highlight the contributions of our new teammates from APT who work diligently and efficiently on the development and manufacturing of these catheters. The unique expertise of APT is highly complementary and additive to Stereotaxis strategy as we increasingly focus on a broad family of robotically-stared endovascular devices.

Beyond catheters, we have several other significant regulatory and development efforts ongoing. The primary milestone in the last quarter was attaining CE Mark for GenesisX in Europe and submitting GenesisX to the FDA for U.S. 510(k) clearance. FDA reviewed our submission and sent us a first round of questions in October. We have begun preparing our answers and expect to respond in the coming weeks. In China, we have been working with our partner, MicroPort, to gain regulatory approval for the Genesis robot, mapping integration and a novel ablation catheter. The Chinese NMPA regulatory body recently completed an on-site audit of our quality systems and the Genesis system in St. Louis.

The success of that audit with very positive feedback shared by the reviewers is a testament to our team and the high-quality operations they established. The successful audit portends well for near-term approvals in China. There's much more going on, but we are keeping today's call focused on the primary milestones and we'll provide a more comprehensive review on our next call.

Our broad-based progress on a new foundational product ecosystem across 3 key geographies is transformational. We are in a particularly exciting period. I'll hand the call over to Kim to discuss our financial results, and then I'll make a few financial comments as well before we open the line to Q&A. Kim?

[Kimberly Peery, executive]

Thank you, David, and good afternoon, everyone. Revenue for the third quarter of 2024 totaled $9.2 million, an 18% year-over-year increase compared to $7.8 million in the prior year third quarter.

System revenue for the third quarter was $4.4 million, driven by partial revenue recognition on delivery of 3 Genesis systems. This compares to system revenue of $3.5 million in the prior year third quarter. Recurring revenue of $4.8 million compares to $4.3 million in the prior year third quarter and reflects the 2-month contribution of our previously announced acquisition of APT.

We received 2 orders in the quarter, and we maintained system backlog of $15.5 million as of the end of the third quarter. Gross margin for the third quarter of 2024 was 45% of revenue. Recurring revenue gross margin was 70% and system gross margin was 16%. Recurring revenue gross margin was impacted by accounting related to the acquisition of APT.

As part of GAAP acquisition accounting, we are required to value finished goods inventory at market giving us minimal accounting gross margin on the subsequent sales of that inventory. This is a temporary margin reduction with no economic impact.

Once this inventory is sold in the next few months, we expect recurring revenue gross margin, including the APT products to return to historical levels. System gross margin continues to reflect the allocation of significant overhead expenses on low production volume. Operating expenses in the quarter of $10.4 million included $2.5 million in noncash stock compensation expense and a $0.7 million noncash mark-to-market adjustment for acquisition-related contingent earnout consideration.

Excluding these noncash charges, adjusted operating expenses were $7.2 million, comparable to prior year adjusted operating expenses of $7.1 million. Operating expenses in the current year third quarter include 2 months of APT operating expenses following closing of the acquisition. Operating loss and net loss in the third quarter were $6.3 million and $6.2 million compared with $5.6 million and $5.4 million in the prior year third quarter.

Adjusted operating loss and adjusted net loss for the quarter, excluding noncash stock compensation expense and the mark-to-market adjustment were $3.1 million and $3 million compared with $3 million and $2.8 million in the previous year. Negative free cash flow for the third quarter was $4.2 million.

At September 30, Stereotaxis had cash and cash equivalents, including restricted cash of $11 million and no debt. Significant cash receipts in October increased Stereotaxis' balance of cash and cash equivalents including restricted cash to $13.3 million at the end of October.

I will now hand the call back to David.

[David Fischel, executive]

Thank you, Kim. We're maintaining the revenue guidance provided on our last call and are glad that our third quarter performance exceeded expectations. This year's revenue is expected to be approximately equal to 2023 without incorporating potential revenue from the launch of GenesisX and MAGIC. We expect year-over-year growth in both system revenue and recurring revenue in the upcoming quarters.

We are cognizant of the importance of protecting our balance sheet, protecting shareholders from unnecessary dilution and managing Stereotaxis in a financially prudent fashion. The maintenance of operating expenses at essentially a flat level as last year, despite the acquisition and inclusion of APT is reflective of our focus on prudent financial management. This posture is balanced with continued investment in the technologies, team and infrastructure that supports growth and success with investments still being made from which we will only reap the fruits of in several years.

We expect to end this year with approximately $12 million cash and no debt. We view our existing balance sheet is allowing us to reach key milestones, commercialize our new innovations and profitably grow our business. We have no intention of diluting shareholders at current valuation levels, and we'll be thoughtful in how we manage our financial position and protect shareholder value. Operator, can you please open the line to Q&A?

[Operator]

[Operator Instructions]

And your first question comes from the line of Frank Takkinen with Lake Street Capital Markets.

[Frank Takkinen, analyst]

Great. Congrats on all the progress, David. Maybe just starting with some clarifying questions on MAGIC just to make sure I understand. So it feels like MAGIC in Q4, still before year-end and CE mark still seems pretty reasonable given where you're at with that process. One, can you confirm that? And two, the U.S. time line, how does the interaction influence that time line? Is it feeling like it's a first half 2025 event? Or is it maybe a little bit too early to call?

[David Fischel, executive]

Sure. Frank, thanks for the good questions. So in Europe, as we kind of described in the prepared remarks, we're at the last, last stages of the review. It is tough sometimes sitting patiently as even very minor things get turned around on the other side of the Atlantic. Overall, we feel very good with how the -- our responses to the original microbiology questions.

And then the, as I mentioned, a couple of clarification questions that came after that. Those were very benign. And so I think that we are in an overall very good fundamental place, and we are sitting patiently on our hands awaiting a certificate. So yes, I think that, that is in the very short term. But again, there's no statutory requirement for the regulator -- so we will sit here patiently until we receive it.

And when it comes to the U.S., I think it's still a little bit early to know. And FDA is definitely reviewing the spectrum of the submission, the various components of it, the various aspects of it. There is -- there are some activities like manufacturing facility audit, which will probably be part of the review process, and that has not taken place yet. So I think there's still several things there.

But I would think that kind of over the next couple of quarters or so, that would be a reasonable time frame. But again, that is something that we're working very collaboratively with FDA. We appreciate the way that they've been working with us. and kind of we'll see how that kind of review goes in terms of the exact time line. I think what has been kind of very nice is how we've reached alignment on an indication the type of data that should be supportive of that indication and how also we can expand our indications after the original approval kind of with post-approval studies in the U.S.

[Frank Takkinen, analyst]

Got it. Okay. That's helpful. And then maybe just turning to system sales. I wanted to understand how the U.S. market is feeling today. It sounds like Europe is strong. I don't know if that's just a current quarter dynamic or if there's more to understand there between Europe and the U.S. market.

And then is there any weighting in the U.S. market for maybe the mobile robot and the MAGIC catheter to come down the pike? Or is it still -- there's still full speed ahead on Genesis, but it's maybe just a little bit of a softer macro.

[David Fischel, executive]

Sure. It's a great question. I think kind of -- I've spoken obviously for many, many, not just quarters, but even a few years about this whole concept of product ecosystems and how you can't really think about a specific product on its own. You have to think about the ecosystem that it works within. And that's why we've been advancing this comprehensive innovation strategy, which really address -- addresses the ecosystem and create attractive ecosystem that can scale significantly.

In Europe, we have the most advanced ecosystem. When you think about the robot, the associated disposables that are either on market or very near market and the integration with x-ray with mapping systems, it is just the most attractive and advance to the ecosystem, given the regulatory approvals that have been reached. And I think you can start to see then once we start to have a good ecosystem in place, the commercial impact that we start to see in the marketplace.

And this is obviously without yet MAGIC on the market without the vascular devices on the market and without actually GenesisX truly on the market because we can't really launch GenesisX without MAGIC being approved in a full sense. And so -- but just having a Genesis with an attractive x-ray integrated with it, with MAGIC being viewed in the marketplace as very near term and with kind of the integration of Abbott kind of the way that, that starts to create a positive dynamic for our sales team kind of with our customers. And so I think that's what you're seeing in Europe.

In U.S. -- and in the U.S. and in China, we're a little bit kind of further behind in terms of bringing that ecosystem together. And so it's just kind of been more challenging. I kind of -- I spoke in the call about kind of how in China, I think we're very close also to couple regulatory approvals that will be very helpful for that ecosystem. In the U.S. also, we're working towards bringing that ecosystem together.

And I think kind of that's also something over the next couple of quarters or a few quarters that we're looking at. But I think kind of the results in Europe are really a reflection of how the ecosystem effect ultimately drives commercialization and why having a good ecosystem is so valuable.

[Operator]

Your next question comes from the line of Josh Jennings with TD Cowen.

[Joshua Jennings, analyst]

And great to see all the progress here. But David, I was hoping to just follow up on Frank's question on the MAGIC catheter and just the trial design. Can you help us understand how it has evolved after kind of hammering out negotiations with FDA and can you divulge what the initial indication is that's been agreed upon? And what the requirements are to have the FDA look positively around the trial design and ultimately the results and make an approval decision.

[David Fischel, executive]

Sure, let me try to touch upon your question. Generally, I think it's best to kind of on regulatory matters, it's best not to be too specific. It's -- I think that's kind of both the norm and what's expected by the regulator, but let me provide some color. The study in Europe has enrolled a broad range of arrhythmia patients -- and so kind of that's an ongoing study. So we continue to enroll patients there overall with very good results and very happy physician users.

And in the -- we can use the totality of that data to some extent, to address overall safety, overall performance of the catheter. There are some sets of patients that are -- have a higher unmet medical need that is not well addressed by manual catheters. And that would be a natural place for us to first gain an indication in the U.S. because that is really an area where there is unmet clinical need with patients and with physicians, where MAGIC provides kind of its most dramatic benefits.

And so I think that's kind of where you should expect our focus to be on and kind of the initial effort and then there will be, again, opportunities to expand indications over time. But obviously, we're most focused on making sure that magic is available for the patients and physicians that benefit from it the most.

[Joshua Jennings, analyst]

Understood. Understood. And I wanted to ask about the APT catheter portfolio. Can -- a great update on the positive reception and your expectations for meaningful sequential revenue growth. Would love to just hear about the cases where APT catheters are being utilized and which catheters. And on how you see this ramp? Is it really just a matter of getting the catheter out into more accounts in the United States and internationally to secure that sequential revenue growth and just maybe help us think through the drivers of and what meaningful growth means?

[David Fischel, executive]

Sure. So maybe stepping back again, APT developed and commercialized family of specialty diagnostic EP catheters that are used in cardiac ablation procedures. These are typically catheters that provide physicians with better electrogram data so that they can better determine where they want to ablate to treat the patient. And there are catheters are very synergistic with us because we have a sales force that is in cardiac ablation procedures on a daily basis on basis supporting those cases and to these types of catheters can be used in those procedures.

They're also synergistic from a messaging perspective. And if you look at some of the main catheters that drive the revenue of APT. There are catheters that are used in more complex ventricular tachycardia procedures, or in a pediatric and congenital patients. And so there are kind of -- there are things that are used in these more complex patient populations we're having good diagnostic information is particularly valuable.

And that obviously aligns also very much from our -- from a messaging perspective, from a values perspective, right? The value of robotics has been at least one of the key values of robotics is enabling and improving the treatment of complex arrhythmias. And so these catheters align very nicely with that, and so it's kind of similar styles of physicians who want to use our robot and want to use the APT catheters and a similar value proposition overall for our sales team when they're presenting the catheters.

And so that's in terms of kind of the products themselves and how they align with our focus. We have been, over the last few months now educating our entire commercial team on the portfolio of APT in turn, educating our physician customers on the portfolio of APT, the vast, vast majority of them had never heard of 90-plus percent, 95% of our acquisition customers had never heard of APT, never heard of the catheters. So really, while these are attractive products, which some KOLs in the field who really love to use these catheters, the vast majority of the field did we didn't know they existed.

And then we've been working in the U.S., if I focus predominantly on the U.S. for now. We've been focusing largely on getting these catheters on contract at various hospitals. So you have to go through value and value assessment committees at most hospitals to get kind of on contract to be able to have kind of the license for the physician to be able to order them from you. And so we've been kind of working through many, many of those VAC committees and we've started to receive orders from multiple hospitals that previously never had the catheter.

And so that's really the process we're going through now is creating broader awareness, working through some of the logistics at hospitals and making sure that the initial use of the catheters by physicians is very good and positive. And then getting reorders and that's why we started to see the benefit of that in the third quarter. as you kind of work more hospitals through that process, you've got more of a benefit in the fourth quarter.

And I think that's going to continue for several quarters, this should be something that has a fairly significant tailwind to it as we work through that process. Generally, I would view these catheters as having opportunities in the high single-digit millions or double-digit millions. These aren't catheters that we're trying to create into [ $100 ] million-plus portfolios with. But you've seen how some companies kind of thinking, let's say, of a company like Bayliss that was acquired by Boston a year or something to go, right? They had often times devices that also were more kind of replacements for other products.

And ultimately, you can build fairly substantial businesses off of catheters that are a little bit better and slightly differentiated and provide value. And so I think kind of this will definitely help our team. And again, strategically, I mentioned this on the call 3 months ago. There's a great benefit to being able to sell these synergistic catheters in the primary goal of expanding robotic adoption because it does increase our touch points with more physicians in EP.

It allows us to afford a larger sales team, and it allows us to then gradually drip the benefits of robotics with many more physicians that we're engaging with anyways on a regular basis. So I think what you're going to see is that as we start to launch Genesis X with MAGIC in the future with the regulatory approvals in the U.S. we're going to have a much richer relationship with various physicians that have never used robotics in the past, and we're going to have a much more capable sales team to do that launch.

[Joshua Jennings, analyst]

Sounds exciting. And maybe just lastly on the robotic HD mapping catheter. Just -- I mean, did I hear that you could get approval potentially as early as the beginning of 2025. And I'd love to just -- I know you've done this before in the recurring revenue per case, would be exponentially higher as you build out this ecosystem of catheters.

But maybe just help us -- remind us current competitors, HD mapping catheters, what there ASPs are maybe the guide catheters sheets are running? And just remind us of the current recurring revenue per case that share taxes is bringing the registrant today versus once the full portfolio is built out, how big that should be per case.

[David Fischel, executive]

Sure. So I mentioned that in early 2025, in the first quarter, we'd expect to submit regulatory to do the regulatory submissions for the against the mapping catheter, the robotic wrapping catheter and the robotic vascular guidance catheter. So those would be the regulatory submissions. And in terms of -- these are obviously more 510(k).

These are 510(k) devices. So these aren't PMAs, the overall regulatory time line should be much simpler than what we've experienced, obviously, with MAGIC. And APT has good experience gaining regulatory approval for its diagnostic catheters around the world. So I think they overall come with a lot of expertise in that. And when it comes to the overall revenue impact I think kind of on the last call, I provided some more color on that.

And we're generally, if you think about our disposable revenue per procedure that we currently get for every robotic procedure, an ablation catheter would again, it depends a lot on the geography and -- but generally should, let's say, triple the revenue, the introduction of the ablation catheter to probably triple our disposable revenue per procedure, adding high-density mapping capital on top of that probably, again, doubles again the revenue there. So you're talking about something in the or so, what our current disposable revenue per procedure is as you introduce these 2, probably in the beginning in the non-EP space as we start to enter into the vascular field.

I'd expect generally the revenue per procedure to be lower, but there's also a multiyear strategy there for how that can increase over time. But I wouldn't expect in the beginning that we're pursuing the same level of disposable revenue per procedure. Our goal really in the beginning is to demonstrate the value of the robot across multiple clinical specialties, and then we'll build out the vascular portfolio over a few years after that.

[Operator]

And your next question comes from the line of Adam Maeder with Piper Sandler.

[Adam Maeder, analyst]

Congrats on the progress in the next quarter. Maybe to start from me, I wanted to ask about your MAGIC catheter. It sounds like CE Mark approval is approaching pretty quickly here. Just remind us kind of how you're feeling about the ability to kind of supply the market from an inventory standpoint? And then also just give us a refresher around the sales force? How many folks are in the European commercial organization? How many folks are in the U.S. as well? And then I have a follow-up.

[David Fischel, executive]

Sure. So when we look at MAGIC in Europe, we're confident that MAGIC is a good catheter and that kind of it can benefit our physician customers and kind of will be a nice improvement to their clinical experience. And so kind of I think given all of our human experience over the last year in the clinical trial, we feel confident with it as a good clinical solution. And we're working a lot with Osypka on ensuring that the manufacturing ramp-up goes well. And so they've been putting a lot of effort into building inventory into making sure they're more efficient in the manufacturing process.

And so that kind of overall has been a lot of engagement to make sure that we are prepared for the launch in a nice way and that, that won't be a big barrier. And then from a sales force perspective, we have about right at 30, 35 hospital customers in Europe. We have a sales force right now. If you include trainers and kind of the full team, it's kind of about a dozen or so sales team in Europe.

And so that team kind of overall works well with all the customers in Europe, you don't have the same dynamic of requiring a rep in every single procedure. But and -- but we do have a plan for how we can -- as we start to introduce the MAGIC catheter and [ gain ] adoption at individual accounts, how we will start to hire dedicated reps who will be focused on a specific hospital and that will allow us to grow our sales team over the next kind of -- over the coming quarters as we launch MAGIC in a nice, sustainable fashion. -- and kind of really kind of providing kind of that added level of service then for each individual hospital.

[Adam Maeder, analyst]

That's helpful color. And for the follow-up, I just wanted just asked briefly about the PFA program. I think you gave an update on last quarter earnings call. It sounds like you have a couple of PFA initiatives in development, but I just wanted to ask her the latest and greatest there.

[David Fischel, executive]

Sure. Thanks a lot. So we have had quite a lot of preclinical animal studies with both actually of the robotic PFA programs that we mentioned on the last call. And we had one actually this past weekend. So we kind of had quite a lot. I think that there is, like I mentioned on the last call, I think that with one of those programs, with both of those programs, we probably can be in first in-human studies next year with one of those even probably having regulatory clearance in the European geography next year.

And so that's kind of -- those I'd say are the 2 main things that we're advancing. There are other at PFA companies that we are collaborating with that are not as advanced as those 2 primary robotic efforts. But those are kind of -- those 2, we've been had quite a bit a few months with preclinical studies, including high-quality survival studies where you kind of assess performance over a longer time period post the procedure.

[Operator]

So there's no further question at this time. I will now turn the call back over to Mr. Fischel for closing remarks.

[David Fischel, executive]

I see 1 more, Mark, if you want to open it up to the last question, it seems like.

[Operator]

Our next question comes from the line of [indiscernible] Fish Capital.

[Unknown Analyst]

I wanted to see if you could just touch a I guess, a little bit of color on the Guidewire on Synchrony and Sync. In particular, the last 2, I've seen on the website, but I've seen no product announcement.

[David Fischel, executive]

Sure. So the Guidewire and the guide catheter has been our 2 initial product that would allow us to expand the value of our robotic system beyond electrophysiology into the broader vascular navigation field. And so those are kind of 2 products that we've worked on for some time. The guidewire with a contract manufacturer that we've had a relationship with and the guide catheter was with APT even prior to the acquisition.

And the guide catheter has now advanced very smoothly, very nicely. And so that's where we plan to do a submission in the first quarter, and that would allow us not too long after that, to actually commercialize and start to use our robot in non-EP procedures and kind of start to expand the use case and the value proposition. And on the guidewire side, ramp-up of manufacturing has been fairly slow with all sorts of starts and stops.

We are making progress there. I still don't know what the right time line for that is given all the started stops that we've had historically. And so I haven't commented because I'd rather kind of comment when I know with confidence that we're going to meet a time line. And so I think kind of there's a decent chance that we get that also kind of in a good place in the coming months. but that's not certain. And so again, right now kind of our most focus on the guide catheter given the high level of confidence we have there. with that coming out. And again, when we visit customers like the ones that I mentioned in London, not customers but potential customers who are not an electrophysiologist. And like in London, there are definitely also a range of applications where the guide catheter by itself can be very beneficial.

And if I shift over to Synchrony Sync Release zinc, again, there was some kind of any reason not to talk about that other than the desire to focus more on the things where there have been kind of significant milestones near term. And Sync has been available on the App Store. We are using it internally with physicians whenever we do preclinical studies we've kind of used it in this kind of limited release setting.

Synchrony is entering formal regulatory verification validation testing very, very shortly. And that's a Class I device that will be a relatively benign regulatory process to it. And so overall, kind of we feel good about how that's coming together. When we have physicians and hospital administrators visit, it is -- it is very nice to see how excited they are by that technology, given that it is really ancillary to what we've been our core robotic offering, but we got very good feedback on it.

So I think that there is going to be a good opportunity with those products outside of just improving the robotic ecosystem. And when we start to launch a product, I think it will be great to do kind of a real tech demo for interested physicians and investor community.

[Operator]

So there's no further question at this time. And I will now turn the call back over to Mr. Fischel for closing remarks.

[David Fischel, executive]

Okay. Thank you very much. Thank you all for all your questions. We look forward to working hard on your behalf to close out the year strong, and I look forward to speaking again next year.

[Operator]

And that concludes today's call. Thank you all for joining. You may now disconnect.