Good day and thank you for standing by. Welcome to the Helius Medical Technologies First Quarter 2024 Earnings Conference Call. [Operator Instructions] Please be advised today's conference is being recorded. I would now like to hand the conference to your speaker today, Michelle Bilski with In-Site Communications. Please go ahead.

Thank you, Kevin. Welcome to the First Quarter 2024 Earnings Conference Call for Helius Medical Technologies. This is Michelle Bilski an In-Site Communications Investor Relations for Helius. With me on today's call are Dane Andreeff, Helius Medical's President and Chief Executive Officer; and Jeff Mathiesen, Chief Financial Officer. [Operator Instructions] Please note that this call is being recorded, and access to the webcast can be obtained through the Investors section of the Helius website at, www.heliusmedical.com. Before we begin, I would like to remind everyone that our remarks and responses to your questions today may contain forward-looking statements that are based on the current expectations of management. These forward-looking statements, including statements regarding potential reimbursement pricing involve inherent risks and uncertainties that could cause actual results to differ materially from those indicated, including those identified in the Risk Factors section of our most recent annual report on Form 10-K. Such factors may be updated from time to time in our other filings with the SEC, which are available on our website. All statements made during this call are as of May 13, 2024. We undertake no obligation to publicly update or revise our forward-looking statements as a result of new information, future events or otherwise, except as required by law. I would now like to turn the call over to Dane Andreeff, President and Chief Executive Officer of Helius.

Great. Thanks, Michelle, and thank you to everyone joining us today on Helius Medical's First Quarter 2024 Conference Call. In 2024, our focus remains on two things: securing widespread reimbursement for PoNS and achieving FDA approval for stroke. We made progress on both fronts and are confident that these milestones are just around the corner. The $6.4 million financing we just announced last week, which extends our cash runway into 2025 will help get us there. I'll start with our pursuit of widespread reimbursement for PoNS. We are pleased that CMS Medicare understood the benefits of this innovative treatment and establish HCPCS codes for both the PoNS mouthpiece and controller, which went into effect on April 1. This was a critical reimbursement and access milestones and the unique HCPCS codes give us the ability to begin negotiating reimbursement with third-party payers. As a reminder, the list price for the PoNS device in North America where it's indicated is $25,700 comprised of $17,800 for the controller and $7,900 for the mouthpiece. Earlier this month, we were pleased to learn that CMS had released its preliminary Medicare payment determinations for the PoNS controller and mouthpiece and placed Helius on the agenda for the public meeting with CMS on May 29. As the preliminary payment determination is subject to change, we are looking forward to presenting arguments at the meeting on the 29th to support higher reimbursement rates. PoNS is different from any neuromuscular peripheral stimulation therapy and so for the controller will advocate using the gap-filling methodology based on our list price versus mapping it out to other noncomparable neuromuscular stimulation devices. For the mouthpiece, we will argue that it's actually a supply that is applied to an individual's tongue. And therefore, the lump sum payment structure is more appropriate than the…

Thanks, Dane. It is a pleasure to be with you today. Total revenue for the first quarter of 2024 was $135,000, an increase of $24,000 compared to $111,000 in the first quarter of 2023, reflecting increased product sales in both the U.S. and Canada. For the first quarter of 2024, cost of revenue was $123,000 compared to $122,000 and for the prior year period, remaining relatively flat due to fixed overhead costs. Selling, general and administrative expenses for the first quarter of 2024 decreased to $2.6 million compared to $2.9 million in the first quarter of 2023 due primarily to a decrease in professional fees and payroll-related expenses partially offset by an increase in contract manufacturer expense associated with the transition to the new contract manufacturer during the current year period. Research and development expense for the first quarter of 2024 decreased to $0.8 million compared to $0.9 million in the first quarter of 2023, driven primarily by a decrease in product development expenses and clinical trial activities as we transition our focus to U.S. commercialization activities. Operating loss for the first quarter of 2024 was $3.4 million compared to a loss of $3.8 million in the prior year period. We reported a net loss for the first quarter of 2024 of $2.5 million or a loss of $3.08 per basic and diluted common share. We also had a net loss of $2.5 million in the prior year period or a loss of $4.42 per basic and diluted common share. Our cash burn from operations for the first quarter of 2024 decreased to $3 million compared to $3.2 million in the first quarter of 2023. As of March 30, 2024, we had $3.6 million in cash and no debt. Last Thursday, we closed on a $6.4 million public offering and…

[Operator Instructions] Our first question comes from Nicholas Sherwood with Maxim Group.

Congrats on the quarter. Can you just go into a little bit more on the time line with the Lovell Government Services agreement that you signed? Kind of like where are you at with that agreement and get like build out a sales team with them? Or just kind of give some more color on it?

Nick, thanks for your question and your comment. So we're in the process right now of having our PoNS therapy be on contract with the FSS and the GSA contracts, the general service administration. This should go public very soon in the next days, weeks. And then by January 1, our team and their team will be all trained up internally, and we could start receiving prescriptions, invoices and training VA rehab experts on PoNS therapy so that they could start treating their patients.

So Dane, I think you misspoke. You said January 1...

Oh, I'm sorry. I mean June 1.

Okay. So June 1 you'll start -- you expect to start receiving prescriptions?

Sometime in, hopefully, early June. There's some training on both sides, but we do have a couple of the VAs looking at PoNS therapy for their MS patients right now. So it's very exciting. They've already targeted at least we know one VA of 25% of their MS population at that VA.

Understood. And then kind of...

I was just going to say, so there's a little bit of an order process. So as they are looking to write a prescription, they would need to make sure that they've got someone trained there before the order could get placed with us. So there's a little bit of an order process that plays out as we're developing these new relationships.

You mean the PT?

Correct. Yes. Physical therapists that would be the one to administer a help with the treatment.

And just to follow on that, yes. So if you remember, we modularize our PT training. So once they receive access to the modulized software, they could do it within 3 hours or less.

Okay. That kind of leads into my next question. How -- what demand have you seen from new physical therapists taking the training program for the PoNS therapy?

Yes. It's been steady and upwards, Nick, on both sides of the border. What we're seeing -- let's start in Canada. We're seeing this because the commercial payers want to see more of the map filled in. So we've really pushed into British Columbia because of what we're doing there. If you remember, the Pacific Blue Cross study and back to work for traumatic brain injury. We had a very successful study that was performed by Pacific Blue Cross, 8 out of the 9 had no longer an issue with balance and gait and returning back to work. And of course, we -- they closed out 5 of their long-term disability claims to save $1.6 million. So that is really an exciting time for us. The payers do want to see us fill in the map with registered PoNS trainers in Canada. And in the United States, we believe that is -- will be part of the process as well. And remember, most patients don't want to be driving more than 30 minutes to and from their PT because the first 2 weeks are -- PoNS is performed in clinic. So the closer we can get registered PoNS trainers to the patients, it makes it much easier for the patient to meet their PT...

Are you are you targeting specific like physical therapists to make sure that you have that geographic coverage in the United States if and when the CMS codes like that reimbursement is approved.

So actually, what we're seeing, Nick, is we're seeing a lot of patients wanting to file claims that are coming from existing registered PoNS trainers, which is a good thing. And these are one-off claims for MS for their gait deficit and we could be helpful there. We're excited to help them with the commercial payers and start their PoNS therapy as soon as possible. But our goal with reimbursement is also be able to sit down with some of the regional, super regional physical therapy chains. We'd like to partner with them to quickly fill in the map once reimbursement goes effective, hopefully, on October 1 of this year.

[Operator Instructions] And I'm not showing any further questions at this time. I'd like to turn the call back over to Dane for any closing remarks.

Great. Thanks, Kevin. Thank you, everyone, for following Helius Medical Technologies. Before we go, I just want to thank the team at Helius for their hard work and dedication to bringing PoNS therapy to the millions who need it. We're right on the cusp. We're excited about our upcoming milestones and look forward to keeping you updated as we pursue coverage and reimbursement and authorization and stroke. Thank you again.

Ladies and gentlemen, this does conclude today's presentation. You may now disconnect, and have a wonderful day.