Greetings, and welcome to the InspireMD Third Quarter 2019 Earnings Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] Please note this call is also being recorded. I would now turn the conference over to your host, Mr. [Indiscernible], Investor Relations. You may begin.

Thank you, Leslie. Good morning, everyone, and thank you for joining us for the InspireMD third quarter 2019 business update conference call. On the line with us today are Jim Barry, Chief Executive Officer of InspireMD; and Craig Shore, Chief Financial Officer. We will start with an overview of the Company results and our recent highlights, and we will then open up the call up for your questions. Before we begin, let me take a minute to note that this conference call may contain forward-looking statements. Forward-looking statements address future events and conditions and therefore involve inherent risks and uncertainties. Actual results may differ materially from those currently anticipated in such statements. Such information is subject to known and unknown risks, uncertainties, and other factors that can influence actual results or events and cause actual results or events to differ materially from those stated, anticipated, or implied in the forward-looking information. Listeners are cautioned not to place undue reliance on forward-looking information as no assurance can be given after the future results, levels of activities, or achievements. Having said that, it's my pleasure to turn the call over to Jim Barry. Please go ahead, Jim Barry.

Thank you, Glen. And thank you all for joining us on the call and the webcast today. While Craig will review our financial results in detail in a few minutes, I want to begin by commenting on revenue. Third quarter was very strong for our company with revenue of approximately $939,000 which is up 22% year-over-year. This was driven by the largest number of CGuard EPS orders received and shipped in a single quarter since launching the product. This resulted in CGuard revenue growth of 41% year-over-year which is particularly noteworthy since the third quarter is typically seasonally soft. We believe this growth reflects an increasing awareness on the part of physicians of the clinical advantages of CGuard relative to both conventional carotid stents as well as surgery or carotid endarterectomy. These strong results give us a high degree of conviction that our commercial activities such as the Centers of Excellence training program and our strong clinical data is having a positive impact on physicians treating carotid artery disease. While the strong third quarter results were driven by our continued commercial focus on CGuard in our key territories, we continue working to introduce it into new markets which provides significant opportunity. As we have noted in the past, most of these potential new markets have higher regulatory requirements that need to be addressed including South Korea, Taiwan, China and Japan. In addition, we continue to anticipate that on visa the regulatory body in Brazil will approve CGuard EPS by the end of the year or early next year. This is significant as Brazil is currently the fifth largest market in the world that treats carotid artery disease and has attractive pricing for carotid devices. A major component of our long-term multifaceted growth strategy is our Centers of Excellence or COE…

Thanks Jim. For the three months ended September 30th, 2019, revenue increased by a $170,000 or 22% to $939,000 from $769,000 during the same period last in 2018. This increase was predominantly driven by a 41% increase in sales volume of CGuard EPS from $604,000 during the three months ended September 30, 2018, to $852,000 during the three months ended September 30, 2019, mainly due to our continued focus on expanding existing markets such as Italy and Russia. As a side note, as Jim previously mentioned, during the quarter we had the highest numbers of CGuard orders since launching the product. This increase in sales of CGuard EPS was partially offset by a 47% decrease in sales of MGuard Prime EPS from $165,000 during the three months ended September 30, 2018, to $87,000 during the three months ended September 30, 2019, largely driven by the predominant industry preferences favoring drug-eluting stents rather than bare metal stents, such as MGuard Prime EPS, in ST-Elevation. The company's gross profit for the quarter ended September 30, 2019 was $128,000, compared to a gross profit of $198,000 for the same period in 2018. Gross margin decreased to 13.6% in the third quarter of 2019 from 25.7% for the same period in 2018. This decrease in gross profit resulted from a $65,000 increase in write-offs predominantly driven by a non-recurring component supply issue. Total operating expenses for the quarter ended September 30, 2019 were $2,125,000, a decrease of 2% compared to $2,177,000 for the same period in 2018. This decrease was primarily due to a non-recurring marketing consulting expense associated with CGuard EPS in 2018. Financial expenses for the quarter ended September 30, 2019 were $73,000 compared to financial expenses of $32,000 for the same period in 2018. This increase in financial expenses of $41,000 was predominately due to changes in exchange rates. Net loss for the third quarter of 2019 totaled $2,070,000 or $1.26 per basic and diluted share, compared to a net loss of $2,011,000, or $2.47 per basic and diluted share, for the same period in 2018. As of September 30, 2019, cash and cash equivalents were $7,154,000, included in this number is the additional $5 million gross we raised in September to an underwritten public officer. At this point, we'll turn the call over to the operator for questions. Operator?

[Operator Instructions] Our first question comes from Vernon Bernardino with H.C. Wainwright & Co. Please go ahead.

Good morning, everyone. And thank you for taking my question. Congrats on the really good results with the CGuard EPS, strong growth there. And now Congrats also on the presentations of publications that continue to show CGuard's safety. Just have a few questions. So MGuard continues to I guess show a lower level because of the changes in STEMI. Do you anticipate that this is now press around the steady state because the results here perhaps similar to the first quarter this year?

So, Hi, Vernon, it's Jim. I will let Craig comment on this too, but I will just tell you MGuard has sort of been lumpy I think through the quarters. It's challenged by its lack of a drug, but it still has some very loyal users that use it not only in STEMI patients but also saphenous vein graft patients. So it's still an important tool out there and we want to keep it out there for those folks who like to use it, but I don't know I'll let you comment on, Craig, what do you think about the numbers.

I think Jim is correct. It is lumpy and that's predominantly due to the fact that it's very heavily driven by tenders. So you could see up spikes here and there in the countries where it's actually being used today.

Perfect and the other question I have is regarding the gross profit and perhaps the inventory concerns that you had before. Are all the inventory concerns not behind?

I assume you are referring to the sterilization issues that we had in the first quarter?

Yes.

Yes. All good in fact I think this quarter actually sends a really positive sign that we got through that. So we got through it in the second quarter, no problem and obviously a pretty good third quarter actually somewhat of a record third quarter for us. So, yes, all behind us. As we said, one-time event and I think we've shown that.

Mr. Bernardino, there are no further questions. So you may continue.

Perfect. So regarding the pathway for the FDA, what kind of discussions do you currently have? I mean let's say like how frequently what information is needed by them that you need to provide?

Yes. So actually it's probably a monthly cycle right now I would say in discussions with them. And it's all been mechanical bench testing data that they've been looking for some clarifications on. So we get those clarifications. We provide them additional data and we sort of a wait their responses. And I will tell you again it's been pretty productive. We've been asked some questions; ask for additional data, a lot of it has been resolved. There are still a few more pieces that are still outstanding. We're trying to get clarification on. So but it's been good and actually all things considered I would say more frequent than I would have expected.

Monthly is definitely a rather frequent. You mentioned bench testing but you also provide them data that comes from outside the United States as far as real-life experience?

Yes. We do. Of course, we have to do that. It can't be used, it can only be used as informational data for their review. So I think it's probably helpful and comforting. They can't really use it in their approval of the IDE.

Thank you. We have reached the end of the question-and-answer session. I'll now turn the call back over to Mr. Jim Barry for closing remarks.

Okay. So that concludes today's call. Thank you everybody for taking the time to join us this morning. And I look forward to speaking with you again on our next quarterly update call in November.

Thank you. This concludes today's conference. And you may now disconnect your line. Thank you for your participation.