Stereotaxis Earnings Call Nuggets: Procedure Side Dynamics
Stereotaxis (NASDAQ:STXS) recently reported its first quarter earnings and discussed the following topics in its earnings conference call.
Procedure Side Dynamics
Stephen Lichtman – Oppenheimer and Company: Bill, if you could talk to the dynamics on the procedure side a little bit more, so you lost a few sales people, so did those accounts completely go away from you, did they slowdown, maybe a little bit more on the dynamic on the utilization side?
William C. Mills III – Chairman and Interim CEO: Well, it was at least a few of these folks that we were missing during at least a portion of the period. In certain accounts and the accounts vary across a spectrum of dependence on this type of system. Some accounts are fully independent and more or less indifferent to the support presence that they may or may not receive, but in the accounts that are dependent or at least partially dependent on that type of support, we do see a softening, not necessarily a complete cessation, but a softening of utilization, because it’s not just the intraprocedural benefits that some of them may enjoy. It’s keeping the procedure top of mind and keeping this tool top of mind when the physicians approach these patients who might be candidates for these sorts of tools and approaches. So, it varies across the spectrum. We’ve learned through experience that when our territories are not covered adequately, then our procedures will soften, and we’ve also learned that those are reversible phenomenon when we repopulate those territories. So, we’re trying to put a little bit of a – more effective presence out there by making sure we have the right resources at the right level, and that means not over specifying them, just as well as it means not under specifying those resources in the field.
Stephen Lichtman – Oppenheimer and Company: And on that point, in terms of the people that you’ve brought on, help us think about the ramp back up in some of these accounts. Are they senior enough, people sort of hit the ground running you think and these accounts will kind of ramp back up their utilization pretty quickly should we be more measured in terms of thinking about the overall procedure number coming back over the next couple of quarters.
William C. Mills III – Chairman and Interim CEO: I think that there is a relatively quick snap back, it’s not a square wave, but I think it’s a relatively quick snap back. I think the folks that are there in the field now are trained placements that they are interacting with have used the system before. So it’s not a cold start, it’s sort of a process of bringing this tool back to top of mind in procedures where it is applicable. So, there really shouldn’t be a prolonged downstroke, if you will, to the cycle. I think we can look forward to being able to measure their impact in the immediate quarter and hopefully beyond that as well. So it should not be a long induction period…
Stephen Lichtman – Oppenheimer and Company: And then just turning on to systems you talked during your prepared remarks about physician champions maybe talk a little bit about your interaction with C-suite and the hospital. Beyond getting the physician by and what are you hearing from the CEOs and CFOs both about their willingness right now due to spend the capital or what else they may be looking for to sort of flip them in terms of Epoch being a must-have in their hospital.
William C. Mills III – Chairman and Interim CEO: Well that’s — it’s a good question, but it’s part of our other complex web of issues because of course the CEO and CFO and the C-suite generally is a very important part of the buying decision, but there are a variety of other inputs that are crucial to this process as well. So, we certainly want to make it easy for the CEO and the CFO to make an affirmative decision, but very typically it’s going to be driven very heavily as well by the physician champion. The person who is going to be using this tool is going to have to be lobbying for this and all of the stars have to align in order to complete a sale of this magnitude. So, when we can – I expect in the C-suite, we will benefit from additional resources in our Company. When these folks look out over the next 10 years, they want to be able to count on the ongoing support for a complex system that we’re going to be needing to offer to them. They are also going to want to account on the ongoing enhancement and upgrade for these systems. As you know we can make a big difference with our periodic software upgrades. So they are going to take a long-term view. These are systems that last on the order of a decade and they are going to want to be sure that they understand not just today’s dynamic, but how the system will evolve over the course of that period. So it’s a multipart decision locus. We need to be able to target effectively and persuade all of these involved parties.
Stephen Lichtman – Oppenheimer and Company: And then just lastly, for me. Japan, can you remind us to what the distributions going to look like there and when reimbursement does turn on how quickly we could start generating revenue there?
William C. Mills III – Chairman and Interim CEO: Well, there’s a parallel track of activity there. So you are right, I mean, it will turn on after the reimbursement piece is in place, but we will need partners on the ground. We will need distributors to work with us in that geography, we’re not going to be able to do that ourselves. We will absolutely need partners differently than what we do on in the U.S. or in Europe. And we are working the distribution and distributor selection and involvement part of that equation in parallel with the not serially, but in parallel with the reimbursement activities. So, we’re hopeful that come year end, we’ll have the pieces in place that we need to, as we said in prepared remarks to begin to generate customer traction in that market, which we’re very much looking forward to.
William C. Mills III – Chairman and Interim CEO: Well, thank you operator. Everyone, again, thank you for your attention this afternoon. We appreciate your being with us and we look very much forward to being with you again on our next call. Have a good evening.