A few highlights from the CC 1) Over 500 systems now in place, an increase of over 25% 2) An 18% increase in kit utilization over the 1st quarter 3) 4 saelsmen added to staff for Pinpoint with expenses for the 2nd of $250,000. They expect to add 5 additional salesmen in the 3rd quarter and expect over time to have a salesforce of 80 salesmen. reaction of surgeons to Pinpoint has been excellent. 4) They expect Pinpoint sales could occur as early as 1st quarter of 2013. 5) Not overly concerned with competition because of growing patent estate and are in bed with the top players such as ISRG. 6) Market penetration related to breast cancer is currently at 10%. They feel they will continue to increase this to the point when it reaches 20%. At that point utilization will increase substantially beyond 20%. 7) long term pipeline is looking good related to nerves and the identification of additional molocules related to cancer. existing systems are capable of handling the new molocules. 8) The existing trial rleated to Pinpoint has excellent Centers involved such as Cleveland Clinic and the Mayo Clinic. 9) In the long run revenue will be driven by the kit sales as system placements will level off. The real revenue growth will be from additional applications. regards endo
end - It was good to hear them clarify the path to "mass adoption", as it currently relates to breast reconstruction and will in the future relate to other indications. The idea is that in the early adoption stage, as doctors are testing the system, comparing notes, waiting for clinical data, etc., you move along incrementally and slowly grow up to the 20% range, where all the adoption factors converge and "mass adoption" takes over generating exponential revenue growth as the system rapidly becomes the standard of care. So, while it is nice to see kit sale revenues ratcheting up from $1.8 in Q4'11 to $2.1M in Q1'12 to $2.5M in Q2'12, these absolute numbers don't get you anywhere if you extrapolate them out. In the mass adoption stage, you will see sequential quarterly kit sale growth in the multi-$millions, so when you start to extrapolate it out you can rationally get to annual revenues in the hundreds of millions.