Welcome to the IRadimed Corporation Second Quarter 2022 Financial Results Conference Call. Currently, all participants are in a listen-only mode. And at the end of the call, we will conduct a question-and-answer session. As a reminder, this call is being recorded today, July 29, 2022 and contains time-sensitive information that is accurate only as of today. Earlier, IRadimed released its financial results for the second quarter of 2022. A copy of this press release announcing the company's earnings is available under the heading news on their website at iradimed.com. A press release copy was also furnished to the Securities and Exchange Commission on Form 8-K and can be found at sec.gov. This call is being broadcast live over the Internet on the company's website at iradimed.com and a replay of the call will be available on the website for the next 90 days. Some of the information furnished in today's session will constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are those focused on the future performance results, plans, and events and may include the company's expected future results. IRadimed reminds you that future results may differ materially from these forward-looking statements due to several risk factors. For a description of the relevant risks and uncertainties that may affect the company's business, please see the risk factors section of the company's most recent reports filed with the Securities and Exchange Commission, which may be obtained for free from the SEC’s website at sec.gov. I would now like to turn the call over to Roger Susi, President and Chief Executive Officer of Iradimed Corporation. Mr. Susi?

Thank you operator. Good morning. And thank you for joining us on the call. I'm very happy to report that Iradimed has had yet another excellent quarter of revenue and earnings growth as reported in this morning's release, which unfortunately I must add, was earlier, only on the SEC site and not in the broader news sources until just minutes ago as there was as of yet unknown issue with the service used for disseminating our filings broadly. As mentioned in our earlier release this was our top revenue quarter ever, and the third and a string of our strongest growth quarters. And I'll add that the trend of strong demand for our products remains very much intact and thus, we feel very good about the coming quarters as well. As reported, our second quarter revenue was $12.7 million, nearly a 30% increase over the second quarter of last year. Non-GAAP earnings were $0.26 or 116% over Q2 2021. I'm very pleased with these results and the hard efforts of our team with a half year behind us and growing at the record levels. We look forward to achieving our guidance for the year. Those supply risks are very much with us on a near daily basis. The team has succeeded in finding ways to prevail and we feel that measures put in place these last months will continue to help us mitigate supply risks. Our sales team continues to perform well, increasingly driving customer demand for our products with total Q2 bookings continuing to reach record levels, once again, coming in higher than shipments for the quarter. Additionally, the strong backlog provides great visibility and affords us the ability to maneuver and reallocate resources as supply issues may arise. Sales are well balanced and strong from both the pump…

Thank you, Roger, and good morning, everyone. Before summarizing the financial results for the quarter, I would like to take a moment to introduce myself. My career as a CFO has spent over 25 years with most of that time spent in the medical device industry. IRadimed is my fifth public company as CFO and I am thankful and excited to work with Roger and the IRadimed team to drive future growth and success. Now onto the financial summary. As in the past, our results are reported on a GAAP basis and non-GAAP basis. You can find a description of our non-GAAP operating measures in this morning’s earnings release and a reconciliation of these non-GAAP measures to the GAAP measure on the last page of today’s release. As we reported earlier this morning, revenue in the second quarter of 2022 was $12.7 million an increase of 29.7%, compared to the second quarter of 2021. Revenue from domestic sales increased 34.5% to $10.8 million and revenue from international sales increased 7.8% to $1.9 million. Overall, domestic revenue accounted for 85% of total revenue for Q2 2022, compared to 82% for Q2 of 2021. Device revenue increased 50.4% to $8.8 million. This was driven by a 45.7% increase in monitor revenue resulting from continued strong execution by our sales team on the conversion of the sales opportunity pipeline. The average selling price of our MRI compatible IV infusion pump system during the second quarter of 2022 was approximately 37,400 compared to approximately 41,600 for the second quarter of 2021. This decrease relates to higher international unit sales and an unfavorable product sales mix compared to the same period in 2021. The average selling price of our MRI compatible patient vital signs monitoring system during the second quarter of 2022 was approximately 48,700,…

Thank you. [Operator Instructions] Our first question comes from Scott Henry with ROTH Capital Partners. You may proceed.

Thank you, and good morning. Just a couple questions. First on the FMD. It sounds like if, I heard correctly, there should be at least 12 units sold in Q3. Could you talk about – how much – how should we think about revenue per unit for that product?

Yes, Scott, this is Roger. Maybe I'll take that first. So, the initial ones, I suppose, are being sold with pricing that we're feeling our way through. These have been at the upper $20,000 area, $27,000, $28,000. So that's what you'll probably see for the initial couple of quarters as we get our toes in this water. Right? And from there, I hope as you've seen what we've done with the pumps and the monitors that we get a little bit of uplift in our ASPs, as time goes on and the market conditions show us that we're on track with the right product.

Okay, great. And then for clarity, I know you said, you would expect to hear from the FDA in kind of September, October on that next generation pump. I mean, would you, obviously, you would prefer final approval at that time, but do you think there's also potential for more correspondence or how should we think about what could happen in that timeframe?

Well, there's always a little more correspondence even when they're preparing the final release that generally takes a takes a whole month, just some back and forth finishing touches to the final letter. So that would be great. We don't know how much capacity the FDA has right at this moment in time though, we keep our eye on this group that does IV pumps and they are rather shorthanded. So that will probably impact, how fast they can work on anything in that IV pump group as well. We have no idea how to gauge that at this point. We'll see.

Okay. great. Thank you. It sounds like we'll just think about Q4 and then, hopefully it comes in at some point during Q4 that final approval. Shifting to the model spending was sort of down across all categories in Q2 versus Q1. I guess Q1 was a strong spending quarter. In general were there any trends there? Or would you just look at that is variation from quarter-to-quarter and any trends there?

Yes, Scott.

Do you want to take that one, Jack?

Yes. Sure. Sure. I would say Scott that, yes, there’s some variability between the quarters, but our spin is pretty much in line with what we’ve been forecasting. There has been an increase in – on the sales side, obviously, with there has been increase in our sales activities in our sales force, and then any of the increase in the spend on R&D will be tied to the efforts on the next generation pump that we’re working on.

Okay.

The G&A side is pretty stable. There was a little bit of a decline in some of our legal and professional expense.

Okay. And then the final question, just on gross margins, you talked a little bit about it on the prepared remark, but my takeaway was, and I want to see if I heard this correctly. Q2 was very strong and it sounds like going forward, gross margins are in fact getting stronger, but perhaps not quite as strong as Q2 would indicate, is that’s the way I should think about that?

Yes. I think that Q2 was, oh, go ahead. Roger. Sorry.

Go ahead, Jack.

No, sorry. I was just going to add to that, yes, I think there that Q2 kind of stood out a little bit, a little above the historical, but some of that was due with the product mix, as we mentioned. Our ASPs have been holding very steady. The other thing that to note would be, I think that as we, the higher sales volume, we’re absorbing more in our overhead and from the fixed overhead standpoint. So that certainly helps, but I think, in that historical range is kind of where we see it going forward.

Okay, great. Thank you for taking the questions.

Sure.

Thanks, Scott. Good to talk to you.

Thank you. [Operator Instructions] And I’m not showing any further questions at this time. I would not like to turn the call back over to Roger Susi for any further remarks.

Thank you. Again, with great pleasure that we report our record growth, especially in light of today’s economic upheavals. Your company is running very efficiently and its products are being adopted at an accelerating rate. Our sales force is growing and you will see that expansion plans to meet growth are being developed. And in fact, currently in initial stages of implementation. With that, I look forward to reporting our future success as the year progresses and thank you all.

Thank you. This concludes today’s conference call. Thank you for participating. You may now disconnect.