MBOT — Microbot Medical Inc.

Summary of Microbot Medical Q2 2017 Earnings Call

1. Key Financial Results and Metrics

• Cash Position: Microbot Medical reported $13 million in cash, sufficient to fund operations for the next 24 to 30 months.
• Expenses: R&D expenses for the first half of 2017 were approximately $561,000, up from $263,000 in the previous year. General and administrative expenses rose to $1.9 million from $140,000, primarily due to costs associated with being a public company.
• Financial Expenses: Total financial expenses for the six-month period were approximately $2.3 million, largely due to non-cash accounting transactions related to convertible notes.

2. Strategic Updates and Business Highlights

• Product Development: The company is advancing its Self-Cleaning Shunt and TipCAT technologies. Two studies are underway: an animal study at Washington University and an in vitro study at Wayne State University.
• Market Opportunity: The minimally invasive surgical procedures market is projected to grow significantly, with Microbot aiming to leverage its technologies to capture a share of this expanding market.
• IP Portfolio: The company has strengthened its intellectual property portfolio, enhancing its competitive position in the medical device space.

3. Forward Guidance and Outlook

• Upcoming Milestones: Microbot plans to complete its studies on the Self-Cleaning Shunt and present initial data at the International Society for Hydrocephalus conference in September 2017.
• FDA Submission: The company is targeting a submission for FDA approval for the Self-Cleaning Shunt in late 2018.
• Growth Strategy: Management is exploring partnerships and potential mergers and acquisitions to expand market opportunities.

4. Bad News, Challenges, or Points of Concern

• High Burn Rate: The company faces pressure to reduce its burn rate, which was noted to be over $4 million annually, necessitating careful management of expenses.
• Regulatory Risks: The unpredictability of the FDA approval process poses a risk to timelines and product launches.
• Competitive Landscape: While Microbot claims a first-mover advantage, the presence of existing shunt products and potential competitors in the market remains a concern.

5. Notable Q&A Insights

• Operational Expenses: CFO David Naim indicated that the company expects a burn rate of approximately $1 million per year, with a more favorable split between R&D and G&A expenses moving forward.
• Partnership Opportunities: CEO Harel Gadot confirmed that the company is actively exploring partnerships with larger companies to leverage their resources while maintaining its core capabilities.
• Design Development: The design for the Self-Cleaning Shunt is still in progress, with ongoing adjustments based on study results.
• Government Grants: Microbot has received grants from the Israeli government, which are non-dilutive and support ongoing development.

Overall, Microbot Medical is making strides in its product development and financial positioning, but it faces challenges related to operational expenses and regulatory timelines.