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Thank you for standing by, and welcome to the ImpediMed Quarterly Investor Conference Call. [Operator Instructions] I would now like to hand the conference over to Mr. Richard Carreon, Managing Director and CEO. Please go ahead.
Welcome, everyone, and thank you for joining us today. We're hosting this conference call to discuss our 4C for the third fiscal year quarter ending 31 March 2019. Our CFO, Morten Vigeland, is with me on the line as well. And during today's call, I'll be referencing the 4C we lodged this morning, Australia time as well as the U.S. investor slide presentation lodged on the ASX on the 18th of April, less than 2 weeks ago. I would recommend you have a copy of the slide presentation available as I move through my remarks. Now as we normally do, we'll take questions following my comments. The financial results for the period ending 31 March were as follows. Our contracted revenue pipeline increased to $7.7 million, up 10% from the previous quarter, and the gross margin for the future contracted revenue remained at plus 90%.Our total contracted value for the quarter came in at $1.3 million, down from $2.7 million the previous quarter, but an increase from the same period last year of $0.4 million or 44%. Today, we have signed contracts for more than 250 SOZO devices globally. Our annual recurring revenue for SOZO contracts increased to $2.8 million, up 12% from previous quarter, and an increase from the same period last year of $1.9 million or 211%. Net operating cash outflow for the quarter was $4.8 million, and this was consistent with the $4.9 million in Q2, but down $1.3 million from the same period last year. Cash receipts from customers for the quarter were $1 million, and cash on hand as of 31 March 2019 was $17.1 million. Our recognized revenue for SOZO contracts for the quarter was $0.6 million, up 20% on $0.5 million last quarter and an increase from the same period last year of $0.4 million or 200%.Now the adoption of our technology remains strong. Churn through the first 6 quarters has been less than 0.5%, and total patient tests conducted with SOZO since launch have surpassed 33,000, with more than 11,000 conducted just last quarter alone. Please see Slide 4 of the latest investor deck for a more detailed look at the growth of our quarterly patient testing since launch. Now overall, we feel that this is a very good quarter, especially after last quarter where I noted the very strong calendar year-end sales that the institutions used their year-end OpEx budget to purchase our technology. Also of note, we announced a significant software release coming in April as well as the embargo of the initial PREVENT trial data and the upcoming presentation of that data at the Annual Meeting of the American Society of Breast Surgeons, or ASBS, in early May. Last quarter, we announced a purchasing agreement with Ascension Health. As you recall, Ascension Health is the largest nonprofit health care system in United States with 151 hospitals. This agreement sets the pricing and IT integration process on a national basis and keeps us from having to negotiate separate contracts for each opportunity. We see this as a positive endorsement of our technology and an opportunity to accelerate sales into this organization. At the end of the quarter, we had sold 3 SOZOs -- we had sold SOZO to 3 hospitals in the Ascension system. Today, we officially launched the third generation of our SOZO software. I cannot begin to describe the significance of this milestone. First of all, this version of the software and all the back office work done over the last year allows us now to collect and analyze patient-specific data. As you know, up until today, we only could collect de-identified patient information. The analysis of this data will allow us to continually evolve our algorithms, improve our software and increase the clinical utility of the technology in hospitals. Now we believe this is a transformational step for the company. Secondly, we significantly improved the installation experience for our customers. Because we are now certified to handle patient-specific data, we no longer have to require a hospital to add a dedicated server to process our data along with the associated ongoing maintenance and security cost. We can now collect all the data directly into our own secure cloud and return the test results back to the clinicians. Finally, we're able to use the real-world data for submissions to the FDA for additional clearance. You will note that we've already begun this process with 3 FDA submissions, as outlined on Slide 30 of the recent investor deck.Now let me provide you with a quick update on heart failure. This remains a key initiative for the company and is looking extremely promising. It should be noted, however, that pending the release of the PREVENT trial, our focus is clearly on the successful commercialization of SOZO for lymphoedema. It is a critical initiative for us. Now for heart failure. During the quarter, we announced the full manuscript of the previously announced abstract on the Correlation of Limb Bioimpedance to Echocardiographic Indicators of Congestion in patients with Class II and Class III heart failure, and that was published in the Cardiology and Vascular Research journal. We continue to enroll patients on our heart failure study, and we expect additional publications on the use of our technology with heart failure patients to be published later this year. Now let me turn your attention to the upcoming release of our interim PREVENT data and our reimbursement plans. The American Society of Breast Surgeons' annual meeting will be the launch vehicle for the broad dissemination of the trial results. As background, the principal investigator, Dr. Ridner, submitted an abstract of the interim results of the PREVENT trial to the ASBrS for consideration of a poster for thorough presentation late last year. This was for their upcoming meeting in May. Of the hundreds of medical abstracts submitted to the ASBS for presentations during the meeting, the PREVENT trial was selected as 1 of only 11 to be given during their scientific sessions. Of the 11 presentations, only 4 were chosen to meet with the national press ahead of their presentations. Dr. Ridner will be meeting with the national press in United States on Thursday, the 2nd of May. Her podium presentation is scheduled for the following day. The PREVENT trial manuscript is scheduled to be available online shortly following her presentation. On Saturday, the keynote address to the entire ASBS will be presented by the Academy-award winning actress, Kathy Bates, who is a two-time cancer survivor and developed lymphedema in both arms following a double mastectomy. So you can see the entire meeting is focused on lymphedema. We have already begun our social media campaign to ensure clinicians and patients are aware of these upcoming events. During the meeting, we will be posting real-time updates to key events as well. And once the PREVENT trial manuscript is made available online, we will publish the link to the ASX. Beginning Monday, May 6, we will accelerate our request for reimbursement to private payers as they no longer are required to sign a nondisclosure agreement to review the embargoed manuscript. As noted in our press release, we have already met with a number of private payers and presented our case for reimbursement for our test. With these payers, we are currently awaiting the decision providing additional information they requested for scheduling face-to-face meetings. Now this is a very exciting time for the company. Let me remind you all of the data we have available to make our case to private insurance companies. If you'll refer to Slide 12 of the investor deck, the annual cost of treating cancer-related lymphedema in the U.S. alone is approximately $7 billion. Now what's exciting for us is that the top line of the PREVENT trial results show that we can reduce the incidence of cancer-related lymphoedema of the limb by 95%.Slide 16, the left-hand table of the Kilgore data show that if you detect and treat lymphedema at Stage 0, the disease was resolved 100% of the time and did not progress any further. As you know, we're the only technology that can detect lymphedema at the subclinical stage.Slide 17 shows 6 studies lasting anywhere from 8 months to 26 months and reducing lymphedema by 73% to 100%. This is real-world outcome, and single practices up to major cancer institution are in alignment -- and are in alignment with our own PREVENT data. So this is becoming very, very powerful information. It also will allow us to do a full meta-analysis of the data. Now what does this mean? If you recall, meta-analysis of multiple studies is considered level 1A evidence, and randomized clinical studies are considered level 1B, so the clinical data that we've been collecting is turning out to be exceedingly strong.Slide 18, you will note the addition of eviCore. This is the clinical guideline for physical and occupational therapy services. And they've stated that this, bioimpedance spectroscopy, our technology, is a validated clinical tool for diagnosing lymphedema. Now this is an important publication that private payers consider when making coverage and payment determinations.Slide 19 shows the cost to the health care system in the U.S. for treating just complicated lymphedema patients. This data was compiled from a systematic review of more than 56,000 insurance claims. The data shows, over a 2-year period, breast cancer patients with lymphedema incurred approximately $120,000 more in health care cost than breast cancer patients that did not have lymphedema. Now we believe that we can reduce this staggering cost by as much as 70% with the use of our technology. We believe we have built a compelling case for obtaining private payer payments for lymphedema testing, both in the fee-for-service setting as well as the at-risk insurance claims. We will certainly keep the market up to date on any positive coverage for payment decisions.And finally, you will note Slide 31 lays out the updated Expected Milestones and Upcoming News Flow covered all the updated [ lines ] during this call.So Izzy, please open up the lines for questions.
[Operator Instructions] Your first question comes from Shane Storey with Wilsons.
I've got a couple. The first is just following on your last comments there about the private payers. The cash, if we start to think about the form that, that private payer coverage might take, I mean, when it comes through, should we think of payment coverage in terms of price per test. I guess this currently sort of happens on the Medicare code, or should we think about some kind of direct support, like a monthly amount as sort of we see in the other areas of health care, like heart failure or even sleep apnea, for that instance.
Yes, that's a great distinction. So let me tell you, the current strategy and the discussions we have is that the private payers will follow the current CPT code that we have, 93702. Now that code states that it will be at the agreed-upon rate of what Medicare has, $145 as a national average. And that they would cover a set number of tests over a period of time. All of that yet to be determined. Now what we've talked to them about is the current -- the protocols that are currently out there. You have the Kansas City protocol. You've got several protocols that have been mentioned in a number of publications. You'll recall that we had a protocol that was published by Dr. Stan Rockson in the New England Journal of Medicine, and then we have our own PREVENT protocol. So I think what they would do is really look to see a protocol and offer that many tests to the at-risk patients. I don't see us going to a monthly fee with the insurance companies at this point just because they would have to resubmit the CPT code to the American Medical Association, and that would have to go through a rough process, everything else that we did 5 years ago to get the current code. So at this point, I don't see us changing how this is paid in the short term.
Okay. My second question is just about the PREVENT study. I mean we're -- obviously everyone's looking forward to, I guess, the event over the weekend. But when should we expect the next release of data from the study specifically, the 2-year follow-up? So I guess that 500 patients whose 1-year data, the world will sort of get to see in great detail this weekend. But that was sort of last April. So I'm just conscious that a year has passed and looking forward to seeing the next slide.
So the latest update on that is I met with the principal investigator, Dr. Ridner, at Vanderbilt just a couple of weeks ago. Flew in there and had a meeting with her. And at that point, she told me that the 2-year data on the first 500 patients would be closed out at the end of April or early May, depending on when those last couple of patients come in and do their final test to close out the 2-year data. At which point, they will close it, they will spread that data and then they will plan on publishing shortly thereafter. So what delayed it last time is 10 authors, all great authors within their own right on the PREVENT study, and also going back and cleaning up that data, one, making sure they have all the right gender, the right date of birth data that there was no discrepancy so on and so forth. Because as you know, when you lock data, even if you discover a mistake later, you cannot go back and change that data. So the base numbers, the first year data, have all been locked. And with these original patients, they have been following them not only very closely but trying to keep up with the review of the data on a constant basis. So I was told that they will be coming up shortly. I don't know what shortly means. I would suspect that it would be submitted for publication sometime this year and probably published shortly thereafter. And I would suspect all of that will happen this calendar year, Shane.
My final question is just to help with the model. I think you called out about $600,000 worth of SOZO-related revenue in the period. Could you just comment on just to what the SaaS component of that was?
Yes, Shane, the SaaS component of that was roughly $0.4 million, so $400,000.
Your next question comes from Matthijs Smith with Canaccord Genuity.
Okay. I just want to follow up on one of the questions that Shane had about the private payers, and I understand this all being linked to CPT code. Has there been any discussion about private payers potentially also covering at-home monitoring? And I understand Sheila is doing a study around that, that would be quite relevant as well.
Yes. Right now, they have not discussed covering payments at a patient's home at this point. There are codes already for doing that. The challenge they have with that, it wouldn't cover the cost of the device at this point. I can tell you we have placed a couple of devices based on prescriptions that have been written, but I don't see widespread payments for a while. I think what's going to have to happen is we're going to have to see more data come out for that. But I would suspect, after we start to see that second round of data, they'll be able to explore those possibilities, i.e., are there very high-risk patients that need to be tested more than quarterly and would it be worth it and the cost? I mean, you can see from the study, if you are a very high-risk patient who gets complex lymphedema, that's $60,000 a year of treatment. If you could eliminate that or significantly reduce it, doesn't matter what you're paying for SOZO in the patient's home. So I think there's obviously some possibilities with that.
But initially, it's most likely be an out-of-pocket if anyone wants to go down that route?
Yes. Yes. It would.
Just a second one following up from Shane as well. I want to be -- just clarify, the 2-year data which, as you say, will be closed out sometime soon-ish, will we have to wait until publication to see what that 2-year data looks like? Or will the market be advised if some of the headline numbers that have come out of that?
No, Shane, I don't -- excuse me, Matthijs, I'm sorry, I don't know if that's going to -- if they're going to do a top line results this time. I think they're probably going to try to move to publication as soon as possible. That was the impression that I had. And they were very upbeat. We spent time with the statistician, we spent time with their clinical staff. I think they want to move to publication as soon as possible. So to do top line results and then go to publication, I'm not sure they're going to do that. I can certainly ask. Obviously, in a day or 2, I'll be with Sheila for 3 days during the ASBS, so I will certainly pose that question.
Okay. And another one to tuck into your Sheila question. While it would be also -- when could we maybe hope to see the 1-year data from the full study, so the full 100 -- 1,100 patients?
No, I don't know how long it's going to take them to take -- to get the other 600 patients locked on the 1-year data, that's probably going to be a longer cycle. I can certainly ask her that. But if you think about it only for us, for us, in the short to medium term, it's the 2-year data that's going to -- what I think insurance companies are going to see on the 2-year data is, one, were we able to continue to see the high rates of reductions in lymphedema and did that last for 2 years and did they see an increase in tape measure because as you know, tape measure can't pick up subclinically. So I think the 2-year data on 500 patients would be very compelling and probably more compelling in the short term than the 1-year data on 1,100. But I certainly will talk to Sheila this week about both of those questions.
Yes. I'm always skeptical of insurance companies and think if they can find a reason to sit it out and say, "Ah, but we need to see if it continues with the full cohort and the like."
Let me back up for a minute on that. I think that's an important distinction. So the reason we put those 6 data points in the roadshow deck was to show that it didn't matter if it was a short-term duration of less than a year or greater than 2 years. The data is compelling no matter what. And I think when you do a meta-analysis of that data, it's going to be right up there with the PREVENT trial in the 90%-plus of reduction of lymphedema, whether, again, short duration or more than 2-year follow-up. So I think it would be hard for them to say, well, I'd like to see the 2-year data because we say you have 2-year data already. And again, the reason we're excited about all of this data coming together is the fact that when you have independent clinical studies that show that you're getting same results as the highly controlled randomized study, it really starts to prove out the technology. So again, as we've assembled our team to pull together this data and to really start to look at, and the information we've already presented to insurance companies, it's becoming apparent that we have a -- we do have a compelling case. And we're very excited about this new information that we're starting to uncover as we start going to these insurance companies.
Also, just while we're talking about data, when can we expect to see the data from the CHF trial? You were saying, again, publication by the end of the year. Is that going to be, once again, contingent on publication? Or will the company be able to release data prior to that?
That -- we haven't gone down that road yet with the principal investigators. I can tell you that later this year, we have a meeting with the advisory board, so we're pooling together our very prestigious Advisory Board where we're going to be reviewing all of the data, all of their recommendations and bringing up the factors, the top line results that we could present, things like that. So let me hold off on that until we have our principal investigator meeting and our Advisory Board meeting later this year.
Okay. And just 2 closely related questions. In terms of, obviously, this weekend's massive of -- for getting the first publication out and the implications for that for marketing, do you have any feeling for, given the meetings that you've had, when we might hear about the first private payers formally covering L-Dex? And I guess, on the basis of that data being released this weekend, what are the plans around submitting them and trying to secure technology-specific recommendations in the NCCN?
Yes. Okay. Good. Two very, very good questions. But first of all, typically, an insurance company will give you an answer within 90 days of your discussions. Now that can be extended if they want additional information or they want a follow-up meeting. But all of those are positive. So if you get a -- if you get something within 90 days, great. If you get a follow-up meeting or asked for additional information, that means you -- that they're very interested, they just want to take a look at it. So I would say, over the next several months, we should start to get the indications of coverage and payment policies that are starting to come through. So I'm feeling very, very good about that. And as I said in my comments, that we will start to accelerate our efforts when we no longer have to have an entire third-party process for getting an NDA to look at data that I can't see and that only they can see and we can't discuss. So I would say, give us a couple of months into the process and we'll start to see that. The second one on the NCCN. So we've already made 1 submission to the NCCN. They are currently in discussions about a second application that would go in with the clinical sites, not necessarily supplied by the company for the NCCN but the clinical sites. And that meeting takes place this week at the NCC -- excuse me, at the ASBS when the number of the principal investigators would be at that meeting in person. So that takes place, and I think that's a more powerful submission for a second submission when you have large cancer centers now requesting a formal technology be written up in the NCCN.
And if we're being positive and optimistic, if that was to be embraced, is there any chance that, that could be put in the NCCN guidelines before the end of the year? Or would that be too optimistic?
No. I would say that it could hit this calendar year yet. Remember, so there's 2 times -- or you can apply to the NCCN on 2 different occasions. One, they have their annual submission, and that date changes every year and that date changes by tumor type. And that's your formal policy. That's not with anything that's earth-shattering, these are just typical updates and so forth. Any time you have new clinical evidence, you can apply to the NCCN in realtime and provide them that information and request a review. And then, they will conduct a review of your data. And it's not -- I mean, I can tell you, a couple of years ago, breast -- the NCCN breast cancer update, they only did a couple. And I think it was last year, they did 5 -- 4 or 5 different updates in their guidelines. So again, it just depends on the data. It depends on how practice changing that data tends to be and what the impact will be for patients. And so I would say we've got a good case [ on -- on it . ] I think from the impact to patients, we can reduce by 95% the incidence of lymphedema. I think, from a cost basis, you could see they're -- just rough numbers would tell you that for every $1 you invest in lymphedema prevention, you can save another $4-plus on health care cost. Again -- and also, I think that's another compelling indication is you can use our technology, whether you're a single facility practice or single physician practice or you're a major cancer institution. So when we start to take a look at what's important to the NCCN, I think we hit all 3 of those with a compelling argument. So right now, that's going to be the critical wellness, make sure that we have all of this data available and that we make that compelling case. And like I said earlier, if it's made by the institution versus a company, I think we stand even a better chance of getting it through.
The next question comes from Scott Power with Morgans Financial.
Actually, Matthijs sort of capped it off on a couple of questions, but I just might follow on, you called out 11,000 tests conducted in that last quarter. Is that the sort of information that you're going to keep continuing to give because I think just getting back to Shane's question on cost per test and all that, that's sort of pretty key for the modeling of the company going forward. Just the number of tests that are being conducted. Just some sort of maybe guidance or update on how you're going to present that information.
Yes. I think we've been pretty regular on updating. Again, if you go to the slide deck, you'll see that we've now taken it out to cover through this quarter. And we're going to continue to provide that information. I think it's critical from an adoption stage, Scott, that it doesn't matter what's happening in the marketplace and if people are on budget or off budget from a standpoint of purchasing the technology. I think as long as we have a growing test base and that continues to grow, I think it speaks to the health of the business. And as I said earlier, too, our churn rate is extraordinarily low. And so I think, from an operational standpoint, we've been able to fix a number of issues, especially the 20- to 30-minute test down to the less than 30 seconds. But we'll continue to report on those patient tests. We believe that is an indicator of the future health of our business.
Yes. Great. And just finally, you haven't mentioned much about the other applications for the test, and I know the focus is still lymphedema and heart failure. But just some general comments on how you're sort of thinking about some of the other applications.
Yes. I mean here's the interesting thing, so I told you earlier that we believe that this software release 3.0 which, in U.S. parlance, really makes us business associate compliant, which means we can now handle patient-specific data. So we're in some very, very good company with all the major players, and I'm talking major, major players having this designation. It's rare for a company of our size to be able to obtain that. We're now able to process that information. And when we get requests from the FDA, we're able to provide them with real-world information. So real-world information that we've already provided them and have submitted for are 3 specific ones that are outlined on Slide 30 of the slide deck. One is malnutrition. Malnutrition is a huge problem. It's a $51 billion issue in the United States, and increases hospitalization, readmission, extensions in hospital, so on and so forth. It's something that we've been asked for, for a while. We were not going to invest money into that, but because we can now pull real-world data, we can submit for it. It's relatively inexpensive, and we're moving through the process with the FDA. Bone density. We talked about that in the past. We provided real-world information, significant amount of information on this. We started this back with [ Lantera ] if you'll recall, past 5 years ago, just getting a reading on it, and we continue to compile data and we're able to use real-world data and submit to the FDA for that. And our bone density for that is on a DEXA scan, our correlation is 0.92 or better. So very powerful. Dehydration, we're being asked from dehydration standpoint. So we've been able to submit data to the FDA on dehydration. I mean, what's interesting about all of this, we collect all of this information, so that 33,000 patient records that we currently have, we can go back and look for anybody who has multiple tests that if they're falling into malnutrition, if they're losing bone density because of their cancer treatment, which is a big, big risk for cancer survivors, and for anybody in dehydration that's having an issue with it. Typically, you'd see that with cancers of the throat or head and neck cancers and so forth. So all of these have been submitted. We would expect by the end of the year to have this part of the increased suite of products that are available for sale to various institutions.
[Operator Instructions] Your next question comes from [ Ian Hyde ], private investor.
With the new devices that you are selling, is that mainly a takeup of existing hospitals changing from the old box to the SOZO? Or is there a sudden increase in new hospitals coming online with the device as such?
Yes. [ Ian, ] listen, that's a good observation. So I would break it down into 3. One, it's a replacement of existing devices. Two, it's new customers. And probably the most exciting for us is those customers were using our old technology and may only have had 1 or 2 devices who are now putting in multiple devices. Probably the best example I always give of that is that Kansas City University Cancer Center, so big, big hospital, more than 4,000 new cancer patients a year, would use only 2 of our older devices just because it took so long to do the test and they limited the test to only the highest risk patients. And today, they have 14 of our devices and they're testing 2,000 of those 4,000 patients today, and they're looking to expand that to all of their cancer patients. In fact, they're doing that currently right now. So again, I would say -- and I don't have the numbers in front of me, but I can tell you that we've converted about half of our older customers to the new platform, of which I would say, a large percentage of those have taken on multiple devices. And then we've added obviously a significant number of new customers, around 350-plus devices that we've already placed in the market.
Okay. And just with the number of hospitals, there are 350 devices out there, but how many hospitals or clinics are they in as a total?
We haven't published that particular data. I think we need to consider doing that, but it's just something we haven't focused on. We've really focused over the years on the number of devices we placed, old ones and this new device. So I think that's something we should consider and we'll make a note of that.
Sure. Well, as an investor, it'd be handy to know because we can see how many devices you've got. But then there's something like 9,000 hospitals or so in the U.S. and then you can start doing numbers as to the size of somewhere down the track where the company can get to as a number of devices, et cetera, et cetera. And I guess following on from that then, with the release of the data from the clinical trial, what changes, or actually I believe you said you've got programs regarding sales and marketing with the data. Do you have dedicated, for lack of a better term, sales reps, that will actually go out and try to actually get contracts with the hospitals? Or how is that all going to flow now once we get this data up?
Yes. I will tell you that once we get the data out, we will -- we're going to be making a major, major marketing effort with major centers in the United States. We currently have a dedicated force of about 10 sales reps in United States, and we have approximately 4 dedicated nurses for in-servicing and training those accounts. And we think, right now, that, that is sufficient until we start to see a move on private payment, and then we would see moving that up because we think that will start to see a breakthrough for us across the country. But right now, we're pretty satisfied with what we have.
Sure. And just on that as well, with the Ascension group because they're more of a group as opposed to just individual hospitals, now the data is out, do you see that as a potential leg up in how you can actually get them to set standard protocols through their 151 hospitals to incorporate SOZO? Or that still really is going to be a hospital-by-hospital situation?
No. I actually believe that there's a couple of things that the PREVENT trial is going to offer. One, it'll show the standard protocol. I also think with the Kilgore data, and I pointed some of that data out earlier, that if you can detect it at subclinical, you can stop 100% of its progression. And then if you combine that with the financial data, I think we have a very compelling case not only for the insurance company but as we pull this information to the insurance company. And I have met with several hospitals and showed this, they are very compelled to start considering very large programs in their hospitals even if they don't have reimbursement. And the reason they're considering that, the cost of treatment of lymphedema, so for instance, the study that I pointed out earlier shows that $120,000 cost of lymphedema for complicated lymphedema. Well, the challenge you have with that, if their patient population of 2,000 to 3,000 cancer patients, if 2% to 3% of them go into a complex one, it is extraordinarily expensive. And what they're considering doing this that they already know that those patients have a 2.5x greater rate of getting infections that require hospitalization. So that's the case. Those aren't profitable. When a patient comes in for IV, well, they typically go to the ICU. In the ICU, they're laying in the bed, they get an IV solution of antibiotics and they sit there and are monitored for 4 days. That bed is highly, highly -- one, that's disruptive. And two, it's highly unprofitable for those hospitals. So if they can reduce or eliminate that and put from other patients in the bed that they can make a profit on, that's critically important. So I think what's been exciting for us is as we've started to put together these presentations, and then as we sat down with these insurance executives, and we have -- you have to have and ask when you go into these companies, and then we're asking for coverage, you're getting into these very rich discussions. And our information has only gotten better as we've spoken with them. So I think what you're going to see is the insurance companies are going to start to be compelled. The hospitals will be compelled on their own. And I think, together, we'll find a way to get this -- we'll get this paid for, and we'll start to see these adopted protocols because as you know, they'll just the place in and do no protocols. I'll tell hospitals all the time as I am out there working with them, that if you're not going to do a protocol, you shouldn't take on our device because you're just giving false hope to patients. Every study proves that if you do at least quarterly testing, you can significantly reduce lymphedema. If you don't do regular testing, then you're just fooling yourself that you're going to randomly catch it at some point. And I believe the data, the PREVENT trial, over time, will show that even for high-risk patients, quarterly may not be enough. So protocol is critically important.
Sure. Okay. And back to the slide deck from the presentation the other week, there was a list [ from then, we have read ] about 12 or so different types of cancer treatment that lymphedema comes from. I understand your focus is clearly on BCR, breast cancer-related lymphedema. But melanoma, I think, has got a higher incident rate with lymphedema than breast cancer and then a whole bunch ones that go underneath that. So is it something that you're seeing in talking to hospitals that they are already starting to focus on moving expansion of testing into these cancers as well? Because I know that University of Kansas said that they were starting to cover pelvic cancers as well back in the announcement with the AGM in October. So is that something that's just automatically going to flow before you're even focused on it? Or what can you put around that?
I can tell you that for the average account today, they're focused on breast cancer. But as we bring this new information around, and everybody would agree, these surgeons, whether I'm doing gynecological cancers or melanoma cancers, they're realizing that lymphedema is lymphedema. And it's caused by damage to the lymphatics. And then, as we can detect it in early stage, they can reduce it. So we're starting to get traction from more than just KU. There's a lot of interest in moving to the pelvic cancers where the rates that you see on that chart and slide on 13 is significant. I mean melanoma alone with radiation, there's a 50% chance of developing lymphedema. So I would say this, I would say, in the end, one, the PREVENT trial will show that we can detect and reduce the rate of lymphedema, and we're the only ones who can detect it at Stage 0. And therefore, I think these cancer centers are going to start paying more and more attention. I can tell you we're bringing this information to them and talking to them about it. In the last couple of presentations I've been on, they're very interested in moving into at least the gynecological cancers and melanoma just because the rates not only are high for those cancers but the population of those are very high as well.
There are no further questions at this time. I'll now hand back to Mr. Carreon for closing remarks.
Izzy, thank you very much. Folks, listen, we appreciate it. I know there was a lot of information we covered today. We're very excited about this coming week. I mean everybody is about to get on their planes and head to the ASBS. We'll certainly keep the market up to date on the progress, but this is a very, very exciting time for the company. So again, thank you for your patience and thank you for joining us today. Have a good day.