Creo Medical Group (LSE:CREO) — Full Year Results

0:01 Good afternoon, and welcome to the CREO MEDICAL GROUP PLC investor presentation. Throughout this recorded meeting, which is scheduled for forty five minutes, investors will be in listen only mode. Questions are encouraged and can be submitted at any time by the Q and A tab situated in the right corner of your screen. Simply type in your questions and press send. The company may not be your position to answer every question it receives in the meeting itself. However, the company can view all questions submitted today and publish written responses where it's appropriate to do so. Before we begin, I'd like to submit the following poll. I'd now like to hand you over to Craig Culliford, CEO. Good afternoon to you, sir. Good afternoon, everybody. Welcome to the call. So just jumping straight in. Financial highlights. So core revenue is up two and a half times over the previous year, which is a strong result on track for the guidance that we had in the market.

0:47 Total group revenue just under 31,000,000. Again, broadly on track with analyst guy guidance. First revenues of our SPEEDICAL UltraSlim device, which is, you know, the device at the long road of a development process of miniaturizing the device to the point where it can be used in every single

1:03 endoscope that might be used in the GI tract from the esophagus to the to the rectum, basically. Underlying operating loss is reduced, which is the first year we're seeing reducing losses, which was as expected, and gross margins are up. So all the indications that we we needed to see, we are seeing the first release of UltraSlim was a little bit later in the year than we expected. We had a few challenges in q two, but we still hit the number. But more importantly, the underlying administrative costs as well have come down slightly. That's just a sort of natural process of some of the heavy end of the engineering process development process, resources kind of dropping off as we reallocate some resources towards some of the front end design work on this spider blade product that we're working with our robotics partners with.

1:49 In terms of final this first quarter of this year, trading has been in line with expectations, strong initial orders, growing sales, and everything can get in on track with what we're looking for in budget for this year. And I think we did the same revenue in the first quarter this year as we did in the first half of last year pretty much. So the doubling of the revenue is is where we we need to sit, which is which is all very encouraging. But I think the key highlight for me is, you know, a number of years ago, beginning of twenty seventeen, we went public with us with a tiny, small, early stage medical device company with an ambition to take, you know, these product brands, Speedboat, Microblade, Spiderblade brands into the market, get clinical data, monetize those brands. And that right now, we can sit here confident that, a, we're delivering revenues on the Speedboat LARDA products with sales of the ultra slim device. We don't need to do any further work on on that foundational technology.

2:41 We brought forward the EU launch of that with the complex MDR rules that the European community brought in for us a few years ago, and that looks likely to flow through into our other range of devices as well, but but we'll see. And that's obviously delivering revenues, and we see strong growth in all the indicators that we need to see for that. On the MicroBlake product, this is the ablation product range. We're obviously working on the the lung ablation program. There's been a lot of press and some exciting news over the last few months about the first ever robotically stabilized and inserted ablation of lung tumor tissue within with the first in man with that that procedure, with the robotically guided procedure. I had the pleasure of watching the second of those procedures back in December, and it's a terrific example of how two great technologies, one from intuitive, one from CREO, delivering stable, absolute perfect stable and precision with the robot with the precision and control of our energy delivered for ablation in the lung. So we'll talk about that a little bit later on.

3:44 And we expect that that's gonna drive an appetite to see some potential early revenues during the course of this year and into next year as the strong performance that we've had with the initial cases with those combined use is looking to there's a lot of excitement in the program. Also, the Microblade range, we have the Microblade Fine product where we've got early cases with clinical use of the device for pancreatic cancer. We're tracking those cases. And in both of those, we're essentially at the post the the sort of post market data perspective stage one of commercialization with initial revenues from both of those expected towards the end of this year and into next. So those those products will be at the beginning of that commercialization and revenue stage. And with Spider Blade, similarly, we are both progressing that with a connector program under the licensing arrangement with our big robotics partners. So with CMR, we delivered a big noncash milestone in December, November, December, and that drives a nonexclusive license arrangement with with CMR.

4:47 Non exclusive because we don't want to take that off the table for obviously working with Intuitive and their da Vinci program, which would be a terrific exercise for us. But Spider Blade is the harmonic scalpel at the end of the flexible endoscope. It's technology that we and, essentially, we are uniquely in a position to deliver that capability in flexible devices and beyond the wrist of the robot, which is the key requirement of robotic surgeons worldwide. We also announced the Califa University collaboration. That's really an exercise in licensing our technology into the university with the specific objective of out licensing that and out licensing that to the Abu Dhabi environment with Khalifa owned by Mubadala Fund with the potential for a joint venture opportunity to to leverage the IP, which would be cash generative for the company and also exploit some of the other IP that we don't have in our development program at the moment.

5:43 On the consumable business, for those that you remember, we acquired a distribution business in Europe, CREO MEDICAL Europe, as it's now called, ex ALBIN MEDICAL. We're growing that business steadily. We are approaching 10% growth this year with that business. We've now done the hard work of rebranding and integrating those products so that 80% plus of those products are now branded and shipped as CREO branded box products. And that also gives us the right to distribute and sell those products in The US, The Americas, and soon to be in the Asia Pacific region as well. So that complements both the advanced energy devices of speedboats by the blade, but it also adds revenue to that business, which is steadily growing. So we acquired that business for a valuation of just under €30,000,000 four years ago. And at today's valuation, that comes in at about $6,570,000,000 euros based on the the valuation that we're looking at. So that is a terrific asset for us to leverage with our partners, which which offers some strategic opportunities in the future.

6:44 We also had our first successful on-site FDA inspection. So the FDA can come and inspect the business even in Europe at any time. It's unannounced, although we do get some some forewarning when we're outside The US. That took some pretty careful time and attention and was a resounding success essentially, which is a significant gotcha for some of the other companies that we've seen in the past here in the Europe in The UK who've been caught out by import bans and so on as associated with an unannounced FDA inspection. So I think that underpins the the the quality and the integrity that we have in our registry and QA affairs, which leaves us in a position where we've got terrific clearance for almost all of our products worldwide now. In with regard to the recent announcement this week of the board evolution. So we announced that at the AGM last year. Kevin Crofton is a chap that I've known for a few years, well known to some of the other team as well. Got a long history and track record as CEO and executive within growth tech businesses, delivered multiple exits for and valuation value for shareholders.

7:53 He'll be replacing Charles as chair after the AGM this year and will be, you know, a real operator and executive within businesses who'd be a great asset to me in running the business moving forward. As an example, he was aware of certain situations with our partners through his board seat at Virginia Tech in The US, for example, which even some members of our partners weren't aware of. So he's deeply connected into that tech and licensing partnership world. Brent Bucher is a seasoned big MEDIC executive running large and small businesses in The US. He's deeply involved in the domain that we are both in pulmonary pulmonary applications, so akin to the ion program that we have, as well as working with ablation devices, surgical devices, has worked as as an executive at NASDAQ listed companies and has routinely taken NASDAQ fund managers out to see cases with tech with medical devices as well as interacting personally with the FDA. So he's deeply entrenched in this industry, understands the challenges and the outlook that we have.

9:00 And we're really looking forward to welcoming these guys onto the board and working with us with that kind of real company executive experience, which we we didn't have with Charles, but Charles has done a terrific job for us. And I'll be eternally grateful for his support since we went public because I had absolutely no idea what it was to run a public company a few years ago before you did the IPO. So I'm not gonna go through the detail of this slide, but we keep this in because this was the the slide that was essentially we used at the beginning of our IPO process in the public journey. The devices at the top you see there with the blue sticks there, the devices that we always had a vision to bring to the market and monetize and bring into clinical practice. And across all of those devices now, we are generating revenues or will be generating revenues associated with that technology this year. And we're also doing that in partnership with some of the biggest robotic companies and brands on the planet, which is a huge endorsement, but it's also now coming through and demonstrating revenue as we look at our pipeline moving forward.

10:06 So we're at significant growth inflection point. We see the growth coming. We see the traction that we have with our current products. This is the guidance that we have in the market in terms of revenue growth and underlying operating loss. So we see the op losses coming down. We see that kind of inflection point during the course of the next couple of years. We've got globally approved site suite of minimally invasive advanced products, which we've talked about, the large and attractive markets, which we we know we're dealing with in terms of lung cancer and the the markets is driving quite a lot of consolidation, a huge investment by the likes of people like Intuitive. The uniqueness of our IP is continually reminded in my reminded by that uniqueness in so many ways as I do my job and travel around and see different companies and see different procedures.

10:54 Many, many companies have tried to use bipolar radio frequency energy to safely cut, reset, and dissect through tissue as well as sealing vessels. And we have got pretty almost unique technology in that, but certainly unique capability to deliver into flexible spaces, which we are with Speedboat and the the device range and also beyond the rest of the robot. So it's significant benefits to patients. You've seen the, announcements recently where we've demonstrated through analysis that NHS supply chain did of our data to show that we're saving £5,000 plus cash per patient episode, almost a 100% reduction in critical care costs, huge reductions in accommodation costs per patient. And that is now being used by some of our customers who are submitting a business case to start the service as opposed to a clinical case, which is obviously great for us here in the NHS and health care systems worldwide where you've got growing waiting lists and, you know, spiraling costs. Anything that delivers clinical benefit and a saving is is working well.

12:02 This slide really shows on the top left just the progression of users. So we're up to about a 195 users as of today. We see that growth continuing. We've got a breakdown of the the the the way that that usage that that user profile breaks down across the estate. We've got no reason to suggest that that isn't gonna continue down that progression that we see there. You'll see on the top right how our costs have increased as we got to the end of the heavy weight, heavy lifting in terms of the development, regulatory clearances, and so on for our devices. And now some of that resource is tailing off. We've held on to some of that resource. We're investing quite heavily in the the robotics pieces at work, so CMR and Intuitive with ION. And, obviously, we're with Endeavor to work with Intuitive and the da Vinci platform.

12:50 But if that investment doesn't succeed on some of the things where we're expected to be investing that, then we've got plenty of room to to to cut more costs out to that if we need to in the event that we don't succeed. But we've got no reason to think that that isn't going to happen at this point in time. So we're very confident with the cash situation in terms of continuing through this curve over the next few months. Bottom left, we track, you know, revenue per customer on an annual basis. This is a punitive measure that we use. We take the total number of users at the end of the year, and that's averaged across all of the revenue for the year. At the end of the year, we have a lot of new users with very low volumes before they uptick, but we're tracking that number, and we're seeing the the trends again in the right direction. So the prerequisites for our business and that inflection are in place. We've got the clearances that we need across the the range. We're into the revenue curve with Speedboat, the range of products.

13:47 We're about to start that revenue curve with Spider Blade Flex both in the GI when we launched that this year, but also through the rendition of that into the robotics space. And with MicroBlade Fine, through that robotics program, we're already generating some revenues, and we see that continuing with the success of the program so far with MicroBlade five also at that stage one of post market cases that we'll be moving into more commercial use of that product over the next eighteen months. So all of these underpin the the projections that we've got, which are in the hands of, obviously, the analyst projections. So in terms of the savings, this is another summary of the NHS supply chain. So total cost savings of about £5,000 per procedure.

14:33 Stays in hospital. The number of days is dramatically reduced. Typically, just over one day. Occasionally, pay patients stay overnight. The time for the total procedure is is down dramatically. Theater costs are almost in half, and the critical care costs are almost completely eradicated. And that shows not just the financial benefit, but the the clinical benefit because after that series of only a 130 patients, nobody needed critical care because the clinical outcomes are so strong in comparison to the alternatives. This is terrific validation that supply chain have done. They selected us as only 12 companies out of their entire supply chain purview. They they manage the procurement of over a third of the the medical devices in the NHS.

15:21 So we were one of only 12 selected, and we've demonstrated some of the most impressive savings that they've seen. So we're very pleased with that, and that is already now helping with traction with our customers here in The UK and alongside the NICE selection for routing and guidance for NICE guideline guidance, then it gives us a lot of confidence about how that outlook looks. So Speedboat was designed for lower GI cases. This slide talks about some of the upper GI. So anything to do with the esophagus, the stomach, the co and the duodenum where the scope is accessing the body through the mouth. On the left, we've got the disease sorry, the procedures that are currently undertaken or being undertaken, and SPEPO is proving to be very effective for those.

16:10 And it's called per oral esophageal myotomy. Most of these procedures relate to cutting into muscle tissue or the the surrounding tissue of the esophagus or the stomach to manage swallowing disorders or manage defamation of the organ and the disease states on the right really describe the diseases that cause these malformations of that part of the body It's very difficult to reset. It's very difficult to replace. Therefore, things have to be taken out. And interesting, the POEM procedure here in The US recently, about eighteen months ago, was awarded the CPT code, a reimbursement code for private health care. So we've seen an uptick in demand for doctors who want to be trained to do POEM because they can now see how they can make more money by doing this kind of procedure as opposed to diagnostic endoscopy.

17:04 Procedures like the FPOEM is f standing for fundoplication. Fundoplication is a procedure often referred to as a toupee or a wrap where oak surgeons will open up the body, access the top of the the stomach where there's a relaxation of the muscle and wrap and cut into that and wrap the muscle around the top of the esophagus to tighten that junction up. It's a very invasive procedure typically delivered for the bariatric obese population of patients. And one of the first patients that I saw SPIVO Ultra done do during December of last year was one of the earliest endoscopic fund applications, an FPOEM. That is a huge procedure volume. Are we gonna take over all fund applications? It won't be anytime soon, but this is the general trend towards moving surgery again from the point of care from the operating third to the general anesthetic to an endoscopy setting where patients are sedated and go home largely with their organ completely intact, and the evidence from supply chain demonstrates that.

18:07 These are the KPIs that we kinda live and die by at the company. So users, where are our users? We're on track with developing our users current as at the end of March, one hundred ninety five. On the left, we manage that pipeline. These are KPIs that run through the Salesforce from new opportunities, assessing our triaging our customers, make sure they got the right practice, they've got the right indications, and they've got the right patients. Going through the value analysis committees and the trial approval process, which is the procurement side of things. So people buy the equipment before they go then into the training. Mentoring phase, which we don't count as users, and and then then they become users once they've gone through that mentoring and didactic training with shoulder to shoulder peer group training with other physicians.

18:54 Something that other top you know, some of the other best companies surgically do, and we are doing a very similar thing. We get more efficient as we as we do that all of the time as we have more people who can train around the world. So travel costs are lower, easier to access, easier to book because we've got more training assets. So all of those indications are helping us accelerate the growth of what we're doing. Just a sort of snapshot of who we are. We are 280 odd people. That's come down from over 300 as that number of the heads with tight tight on costs. We've got offices dotted around through partly through the acquisition and the our US presence. We ship 5,000,000 products worldwide every year through the distribution business. 80% of those are branded box CREO products.

19:41 5,000 customers, 3,000 procedures, 250 users if we as we include those it's more than that now, include those that are in mentoring. And we've got major partners in the form of CMR, Intuitive, Calif at the bottom, as well as some of the top brand, yeah, public sorry, private health care systems in The US, Mayo, Cleveland Clinic, Kaiser, Brigham Health, and so on. So we're we're in all the right places, and we're expanding in and this is where the dots on the map look. So if you look at where we have Chroma systems, we've got a good cluster of products centered around Europe and The UK, which is where we essentially got most of our traction earliest because we couldn't travel during the pandemic two or three years ago.

20:29 And the clusters of of sites that we have in The US are sort of largely on the East Coast with with some tight density around the population, high density areas on the West Coast. And then dotted around where we have distribution elsewhere in the world, either strategic sites for key opinion leaders, but we get some strong usage in and around India where we have there's a lot of global centers of excellence for endoscopy where they do a lot of these advanced work. So that's quite a strategic target for us. I think we've probably talked about these brands. Again, each one of these products now is at or will be at the stage of crystallizing revenues or has already started that process this year, and that's giving us a lot of confidence with our results.

21:18 So I'll skip this because this is the video. This is the PDF, isn't it? Yeah. This is an example of a customer in The UK. For those of you who made it to the Capital Markets Day back in November, you would have probably met Sal and some of the team. They acquired a system to go into every one of their endoscopy units rather than trying one before they acquired further systems. They rapidly got through a good caseload of cases, and they immediately saw reduction waiting list both in endoscopy and surgery. So they've seen the benefits. They've since been scaling the operation so the the number of cases they're getting through today is significantly more than where they were. And on the back of some of the supply chain data that we're getting from NHS, customers are able to bulk buy an order through the supply chain, which is, again, giving us a lot of confidence for what comes next.

22:12 This was presented at the Capital Markets Day. It's the subject of a publication at DGW, which is one of the world's largest conferences this this yearly globally in Washington this weekend. At the top, you'll see images of a patient's esophagus where when you get disease states that wrap around the esophagus, quite often the surgeons have to remove the lining of the esophagus. When that happens with current technology, it causes damage to the underlying outer jacket of the esophagus layman's terms. And as that heals, it scars and tightens up. And you can see the image third from the left. That's how tight this patient's esophagus came because of the scarring left by the surgical tool that was used.

23:01 And the only way to solve that is the patient has to come back for repeated balloon dilations to stretch that back up, to open up the esophagus so they can eat properly and digest. So this patient had 30 over the course of three years. So that's once a month. The patient is coming in for at least an hour's endoscopy, sedation, another endoscopy procedure, another device to dilate their esophagus. And even after three years, the esophagus is still not completely open and it's scarred. As As soon as this physician started using the advanced technology that we have with SPIPO Ultra, at twelve weeks, the organ is almost completely healed and completely open and back to normal, and that required no balloon dilations at all. So that was in two endoscopic sessions, one to treat and one to follow-up as opposed to over 30 endoscopy procedures for the other patients. So the pay the patient benefits stand out and, obviously, the cost benefits in this other indication stack up.

24:00 So, again, the indications are all in the right position for us. But it's not just about speedboats. Spider Blade will be launching in the GI this year, but it's also what underpins technology with our robotics partners where we can deliver what we would refer to as harmonic scalpel capability at the end of of the endoscope and beyond the wrist of the robot. And that truly is quite unique technology that we have able to to deliver into the market. And that will generate initial revenues during the course of this year and into next, and is the subject of negotiations for significant partnership deals on the back of some milestones that we have to deliver in the next the next two or three months.

24:51 Think, again, this is another video, but this shows the yellow instrument that you can see there is one side of the spider blade technology that's been integrated into a a trial version of a robotic instrument. We've got some further trials to do, as I said, in the next two or three months, at which point we'll be looking at licensing this technology with a significant partner. And then also quite exciting at the moment is the first lung cases that we've been doing. So we announced the clinical study last year for the a clinical trial looking at the the safety of delivering microwave ablation at the frequencies that we utilize for very targeted, very precise ablations, pulmonary, using flexible endoscope access.

25:40 And as part of that, we would then did our first few cases with the ION robots part of the work that we've been doing with Intuitive, and that's generated a lot of excitement with, you know, strong results so far. We can't say too much about the content and the the outcomes of the study because it is within a study, but we expect to have the first reporting point from that study over the course of the next few months, at which point we'll be able to really understand what the results of those, albeit we do have people in the room when a lot of these cases happen. So we are very confident that the initial safety profile is extremely good. But I had the pleasure of watching one of these cases with the robot. It's extremely precise. They're able to navigate the visualization to the site of a tumor.

26:26 They're able to then take a biopsy using a needle introduced via the robot. And then, again, using the robot, we were able to introduce the MicroBlake Flex product. And within three minutes on the back of that diagnostic procedure, we're able to deliver the ablation in a highly targeted way. So as the quote says at the bottom, the potential to combine diagnosis, staging and treatment, and in one procedure treatment of that ablation of that tumor is a game changer for the patients as well as the providers. The study that we're delivering at the moment really highlights the precision of those lesions and the vision will be that once screening for lung cancer starts to become more part of everyday life, which is starting to happen here in The UK as they accelerate screening for the first time in the last twelve months, more and more of these small lesions will be found, and that has always been our target indication that those small, very early precancerous or early stage cancers will be able to be treated as part of a see and treat algorithm.

27:29 Working with ION is obviously the most powerful partner for us to do that with because of the precision and the the commercial weight of that partner. So in summary, we're dealing with very large markets in the reception space. For those of you who followed us there, we don't we don't we're not short of cases. What we need to do is shape the market so that users reskill and and skill up to be able to do this, which we've got strong traction to do. The ablation market, particularly around the lung tumor ablation market, we don't need to look very far for the number of indications that that comes with and the consolidation and investment in that market both by companies like Intuitive, J and J, and others where billions of dollars are being spent in the process of improving diagnostic yields, improving the staging of the diagnostics so things can be treated earlier and patients can be treated earlier and reduce the the mortality rate of for those patients. That's the vision, and we're starting to do that now. And then the general robotics robotically supported laparoscopic surgery market is developing fast, and, we have a tool that every surgeon that we probably interact with, tells us repeatedly, including our large partners, that laparoscopic, and harmonic scalpel capable capability at the end of the robotic arm beyond the wrist is the technology that they want

29:00 to see. And that will become a a significant part of what is already a two million procedure market. That's two out of twenty million and growing soft tissue surgical procedures that are done laparoscopically. So over the next few years, it's it's it's it's obviously going to be an increasing space where of those twenty million cases increasingly more and more of that will be done robotically, and our technology will be an enabler to accelerate the number of cases that can be done robotically.

29:34 So this was the slide that we used last year of the fundraise. Obviously, cash is obviously number one on our mind. Getting to that breakeven point, that cash breakeven point. We are on track with our numbers. We're at the early stage of that growth curve, which is a blend of growth in our underlying consumable business, growth in the core products, growth in the the and the licensing products that we have. And we're not overly ambitious on that right that revenue from licensing at this stage because it's too it's too unknown. But what is known is some of the engineering fees that we can and are generating through the programs that we already have and expect to have in play over the course of the next eighteen months. So we sit here confident, a, that we can deliver that cash breakeven.

30:23 And I think I said to everybody at the fundraise back in February last year, you know, not only can we do this, we have a number of other opportunities within our gift over the course of the next few months where there's opportunities to strengthen collaboration with some of our other partners on the distribution side of the business that could could leverage non dilutive cash into the business as well as other opportunities from a licensing perspective that we're developing elsewhere, which both give us confidence to add a nondilutive cash to the balance sheet even if we need whether we need it or not because they make sense, but they balance out the the overall risk profile for delivering the the cash breakeven point over the next twelve to eighteen months. So we remain confident of where we are and what we need to do over the next couple of years.

31:18 So skip it through that. Perfect. Craig, thank you very much for the presentation. Ladies and gentlemen, please do continue to submit your questions just by using the Q and A tab, which is situated in the top right hand corner of your screen. But just for the company review those questions that have been submitted, I'd like to remind you that the recording of this presentation along with a copy of the slides and the published Q and A can be accessed via your investor dashboard. Craig, at this point, if I could just

31:40 hand back to you to read out the questions where appropriate to do so and give responses. I'll pick up from you at the end. Okay. So first question I've got here is, using the data from the study, the health economics data, how long would it be expected for NHS Trust to recover at sunk cost in speedboats? So they said the cash savings that have come out of that are £5,000 per procedure. So on a generator, an equipment cost, just the equipment is about £20,000 for at full price. So you're talking about five to six cases over which the time they would recoup that cash saving for the generator. There's obviously time investment for their surgeons to visit training and have people come and train them, but we're talking about a few weeks of a very small number of cases before they get that cash return on the investment for the equipment and the sunk cost.

32:32 Question two is what's the current progress with regard to the NICE assessment? So we announced last year that we've been selected for routing and guidance for NICE guidance. A key component of that there's two key components. One is the clinical data. So as we understand it, NICE are reviewing that clinical data. But the equivalent component to that is the health economics data that has to go alongside that, which NICE evaluate as well. So, obviously, with the announcement and the publication of the the health economic data from the NHS, then that will sit alongside that assessment. We do know that there's been some restructuring at NICE that is causing some delays, but we hope and expect that the economic data from NHS supply chain will help bump us up the list of priorities for NICE.

33:18 But we we are in the process with NICE for routing and guidance, and we don't see any reason why that might not come through, but we'll see how things pan out. Question three is looking at the the lung tumor ablation trials in the news. Obviously, it's generating a lot of excitement. Question is, is it possible to quantify the excitement and the the the positive results? How many patients have been treated, their current progress, and is there a clinical endpoint to judge whether it will be a success or not. So I can't disclose specifics about the patients or the outcomes other than that general it's a positive outlook based on seen, but we are not privy to the exact data. We're not privy to the results. But what I can say, which is public, is that the the primary endpoint for that study, and it's a relatively low number of patients, is for immediate safety first so that when we deliver ablation into lung tissue and tumor tissue, we do no harm because what we're doing is that we're ablating and denaturing the tissue, be it healthy tissue or tumor tumor tissue, and we we need to be able to ablate both because we need a healthy margin around them.

34:30 And what we need to know is that we can do that without causing any harm, which point we can start doing post market cases or extend additional studies to do do the the longer term follow-up that will show the effectiveness of reducing mortality, improving long term outcomes for this disease as part of an overall screening program. So that's something that we are excitedly talking to Intuitive about at the moment in with regard to the potential for extending that post market cases under strict audit control so that we can gather more and more data, but that's something we're we're negotiating with intuitive at the moment. Question four says you've referred to alternative forms of financing or similar words may be available if things get close with current cash way cash runway. Is it possible to expand on that?

35:23 The spectrum of an additional raise may be weighing on the price. We're obviously acutely aware of that ahead of the fundraise in February last year. We looked at a number of options to finance the business in the events that that the markets as they were a year and a half ago, which was difficult markets to say the least. We could fund that. And the outcomes of that are activities such as the CALIFA deal where we're working with, external partners specifically with a view to joint venturing and licensing technology, which would generate cash for the business. We've obviously been working with our partners, some of them significant on some of the programs to see whether or not there are cash payments that we could leverage in as part of those deals, which is ongoing, and we've got great progress with those.

36:10 And then some of the other partnerships that we have, the opportunity we've got in Europe is having got to the stage where we now ship 80% of our products boxed as our own own brand CREO products, and they're launched in key markets already. It's really important for us to secure that supply chain so that the manufacturers of those devices, which are complementary to the advanced product range, add revenue per case. But that doesn't get taken away from us so that the principals don't decide to go direct under their own steam or give distribution to somebody else. So we're in active discussion with those partners to see whether or not we can secure a a deeper relationship with those companies in order to secure our supply chain and also leverage greater access to most likely the Chinese market with a partner who can help take our products into China alongside their products.

37:05 Yeah. That comes at a price. We've got negotiations taking place with a number of those to see whether that could generate nondilutive cash and create a strategic growth opportunity for the business. Just to give you a flavor for that, the acquisition value of that business when we acquired it three or four years ago was around about €27,000,000. And on today's valuations, we're looking at a valuation of somewhere between 55 and €70,000,000. So we've generated a lot of growth in that asset, and that is a divestible asset if we ever needed to. It's not something that we see need to do at this point in time, but we these are all options immediately available to us. So the question six here is there's obviously great view, great news flow. We've got some great milestones.

38:00 We've got a lot of confidence looking forward. I'm a very early investor and intend to hold for the long term. However, I'm concerned that with low trading volumes and share price that we are vulnerable to a takeover. What protections are in place to prevent this?

38:13 Have we thought of listing on different market where volumes, liquidity, and ultimately share price might be more favorable? So we are obviously aware of that. The you know, we're focusing on delivering the goals for the company first and foremost. This is to increase revenue, utilization of the device, making sure the new devices that we expect revenues to come through this year go really well and start the revenue curve for each one of those that layers on success for the business. As for the funding question, as for the takeout opportunity, you know, the protections that we've got are fundamentally making sure that we've got the analysis the scenes so that we can defend a lowball offer with the board. And then that becomes a board decision as to whether we accept or present those offers to shareholders under the the as I understand it, under the rule rule four guidance.

39:03 So we've got lots of defense for the potential valuation. I mean, in reality, if you value the value of our technology, the opportunities we have with our partners, the the valuation is not difficult to arrive at a valuation that is significantly significantly higher than where we're trading at this point in time. So that gives us a good degree of defense when it comes to being vulnerable to a a lowball offer for the company because that that can't happen unless we choose to accept it. We We have to have the material behind the scenes and the analysis to demonstrate that we believe that's the right thing as a board to reject such a low ball offer if we choose to. Perfect, Craig. Thanks very much for answering those questions. And, of course, the company can review all the questions submitted today, and we can publish written responses to those on the investor meet company platform.

39:49 But just before redirecting investors to provide you their feedback, which is particularly important to the company, Craig, could I just ask you for a few closing comments? I think my closing comments are I go back to 2017 when we went public with this company. We had a vision to put all of these brands into patients, deliver care, deliver improvements, move the point of therapy from surgery to the endoscopy room. And it's just deeply rewarding for the rest of the company, and we are super excited because we are actually doing that. We're doing it on a regular basis. It's something we're seeing the revenues come through. We are monetizing each of those brands, and I can see how that is gonna happen and how that fits within the team. The fact that we've got the validation from working with some of the the biggest, most eminent device companies in the planet, let alone the the robotics partners that we have, just further vindication of quality the of the technology and the regulatory platform that we've built. So I think we really are at an inflection point.

40:47 This is hard work. We've gotta keep keep, you know, feet to the floor and keep our eyes on the knitting that we've gotta get done, but, yeah, we can see the trends that are developing. And, you know, in many ways, we've done what we said we've done. We had a two year gap with the pandemic, which we've overcome. We invested into the business that gave us a platform in Europe, that is generating real value that we could utilize to help fund the business if we ever need to and offer offer great opportunities with our partners. So I'm really happy with the way think where we are, and more importantly, we're just continuing to treat more patients and in in different forms with different indications. And we're we're starting to generate revenue for that, which is the rewarding part. So thanks for everybody's support so far, and looking forward to delivering more of that over the next few years.

41:36 Perfect, Craig. Thank you once again for updating investors today. Could I please ask investors not to close this session? They should now be automatically redirected to provide your feedback in order the management team can better understand your views and expectations. This will then take a few moments to complete, but some should be greatly valued by the company. On behalf of the management team of CREO MEDICAL GROUP PLC, we'd like to thank you for attending today's presentation, and good afternoon to you all.