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Pulse Biosciences, Inc. beats earnings expectations. Reported EPS is $-0.17, expectations were $-0.24.

Operator: Thank you for standing by. My name is Louella, and I will be your conference operator today. At this time, I would like to welcome everyone to the Pulse Biosciences’ Fourth Quarter 2024 Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers’ remarks, there will be a question-and-answer session. [Operator Instructions] Thank you. Please be advised that today’s conference is being recorded. I would now like to turn the conference over to Trip Taylor, Investor Relations. Please go ahead, sir.

Philip Trip Taylor: Thank you, operator. Before we begin, I’d like to inform you that comments and responses to your questions during today’s call reflect management’s views as of today, March 27, 2025, only and will include forward-looking statements and opinion statements, including predictions, estimates, plans, expectations and other similar information. Actual results may differ materially from those expressed or implied as a result of certain risks and uncertainties. These risks and uncertainties are more fully described in our press release issued earlier today and in our filings with the U.S. Securities and Exchange Commission. Our SEC filings can be found on our website or on the SEC’s website. Investors are cautioned not to place undue reliance on forward-looking statements.

We disclaim any obligation to update or revise these forward-looking statements. We will also discuss certain non-GAAP financial measures. Disclosures regarding these non-GAAP financial measures, including reconciliations with the most comparable GAAP measures, can be found in the press release. Please note that this conference call will be available for audio replay on our website at pulsebiosciences.com in the News and Events section on our Investor Relations page. With that, I would now like to turn the call over to Co-Chair of the Board and Chief Executive Officer, Paul LaViolette.

Paul LaViolette: Thank you, and good afternoon. Thank you all for joining. I’m Paul LaViolette, and I’m very pleased to be hosting my first earnings call as Pulse Biosciences’ CEO. I’ll start by introducing myself and providing updates on our progress with each of our market programs before introducing our new CFO, Jon Skinner, who will review the fourth quarter 2024 financial results. We will then be joined by Bob Duggan, Co-Chair of the Board for a question-and-answer session. I’d like to begin with my reasons for accepting the role as CEO at Pulse Biosciences and in this context, frame for investors the incredible opportunities ahead for the company. I have been a builder and operator and investor in the MedTech space for the past 45 years and have had the rare opportunity to work directly on a long list of exciting technologies, new therapies and large market opportunities.

More recently, as a venture capitalist in MedTech, I have led investments and participated as a Director or Board Chairman of numerous innovative MedTech portfolio companies. Prior to my decade and a half as a venture investor, I was Chief Operating Officer of Boston Scientific and committed 15 years to helping build that market-leading company. As I became aware of Pulse Biosciences and its unique nanosecond PFA technology, I quickly concluded that I rarely, if ever, seen such a strong combination of proprietary technology, clinical potential and market opportunities converging into a single-focused MedTech company. As a result of this assessment, my decision to join the Board was natural, and when the Board asked me to become CEO, I found the opportunity irresistible.

I feel my decades of highly relevant experience and my passion for building great teams and important new therapies will help propel Pulse in its current mission as a clinical development stage company and its next mission as a scaling commercial growth company. I am now 2.5 months into the CEO role and my impressions of Pulse have been reinforced as my conviction in the value proposition and business opportunity has deepened. The novelty of nanosecond PFA, the strength of our team and Board, the pre-clinical and developing clinical data, large and growing market opportunities and our strong balance sheet combined to create a genuine and energized excitement that I know I share with every member of the Pulse Biosciences team. More specifically, I am pleased with our progress in the early commercialization steps of our Percutaneous Electrode to deliver soft tissue ablation for benign thyroid diseases.

We are also executing on two clinical feasibility studies with the surgical clamp to treat atrial fibrillation in cardiac surgery and our 360 Catheter to treat atrial fibrillation in the dynamic EP Catheter market. For me, Pulse Biosciences is the next generation pulsed field ablation company. Pulse Biosciences is committed to the therapeutic innovation with the intention and potential to improve the quality of life for millions of patients by developing and commercializing our novel nanosecond PFA therapies. Our clinical stage feasibility studies and initial commercialization suggest to me that nanosecond PFA will be a disruptive and transformative technology in multiple clinical applications and in large markets. Nanosecond PFA offers all the benefits of microsecond PFA, which for example is performing incredibly well in its initial launch in Electrophysiology.

Nanosecond PFA improves upon the stated benefits of microsecond PFA being non-thermal and delivering faster treatment times, while staying within the same workflow. At the same time, the proprietary elements that comprise nsPFA make it a totally unique form of pulsed electric field. nsPFA delivers a significantly shorter pulse duration, given that nanosecond is in the range of billionths of a second. This allows delivery of high amplitude or voltage pulses that can create deeper lesions in shorter delivery times with lower total energy delivered without the risk of thermal damage. At the cellular level, the mechanism of action of nanosecond PFA is unique and differentiated from microsecond PFA. Nanosecond PFA creates electroporation within the cells internal engines of life, the organelles, which stimulates the cell to initiate regulated cell death.

The body then responds with its normal process to remove damaged cells. This is a special clinical benefit of nanosecond PFA. Altogether, this translates to nanosecond PFA’s potential to improve patient outcomes for a diverse array of medical conditions. Our significantly shorter energy pulses also enable unique and more flexible product designs and potentially a better ablation methods. We are seeing the preliminary results of unique nanosecond PFA therapy in our first use cases of atrial fibrillation and benign thyroid disease. It is extremely rare for one energy modality to concurrently achieve distinct therapy goals in Electrophysiology with pulmonary vein isolation with our 360 Catheter and for ablating benign thyroid nodules with our Percutaneous Electrode.

This is why nanosecond PFA is so clearly a platform technology. Our single CellFX nanosecond generator system connects to each of our organ specific applicators to produce unique PFA therapy for a myriad of anatomical targets and diseases. Pulse Biosciences is principally clinical and launch stage, while already having received seven FDA clearances, treated 6,000 patients, earned FDA breakthrough device designation for its cardiac surgical clamp and is commercializing our first treatment within the soft tissue ablation clearance. This considerable list of technology validating achievements represents a mature platform that can be leveraged across multiple clinical and regulatory initiatives. Our differentiated technology is protected by a portfolio of over 180 issued patents to-date, covering an array of systems, methods and devices to generate and deliver nanosecond pulse therapies.

Pulse Biosciences possesses a unique therapeutic platform, enabling multiple clinical programs. So let’s turn our attention to our recent progress across the business and our fourth quarter update. We have had a productive period for Pulse Biosciences since our last quarterly update, and I’m proud of the team’s accomplishments. We are set up to deliver on a number of important milestones that position the company favorably for an exciting 2025. Here are a few highlights of our progress since the start of Q4. Clinical data on the catheter based treatment of AF with our nsPFA 360 Catheter was presented at the AF Symposium along with a live telecast and demonstrated unprecedented procedure efficiency based on the treatment capacity of nanosecond PFA.

Clinical data was presented at the American Thyroid Association and the North American Society of Interventional Thyroidology on benign thyroid nodule ablation using nanosecond PFA delivered with the Percutaneous Electrode. We appointed our new Chief Financial Officer, Jon Skinner. We also added our first direct commercial resources to commence account development and the launch of our soft tissue ablation product in the U.S. Additionally, we added Dr. David Kenigsberg as Chief Medical Officer for our Electrophysiology program, a thought leader in this space in addition to several new leaders in our clinical department to prepare Pulse for the execution of IDE clinical trials to be initiated later this year. Finally, we again strengthened the balance sheet through the exercise of warrants from the rights offering last year.

These accomplishments are foundational for advancing our 2025 goals. Our top priorities for the year are to advance commercialization of our soft tissue ablation device in the thyroid market and to initiate IDE pivotal studies for our Cardiac 360 Catheter and cardiac surgical clamp. Now, I will provide updates on each of our individual products. Starting with our soft tissue ablation device, the Percutaneous Electrode. We see tremendous market potential for our nsPFA Percutaneous Electrode system, which has a broad market clearance for the ablation of soft tissue, such as unwanted tumors and nodules in the thyroid, liver and breast. As the first clinical use case, our product seems particularly well-suited as a possible treatment for benign thyroid disease, such as benign thyroid nodules.

Patients diagnosed with benign thyroid disease have nodules growing on their thyroid gland that can cause discomfort given the location and surrounding anatomy in the throat. The nodule commonly continue to grow and become increasingly uncomfortable and symptomatic. Patients are faced with a difficult decision to either remove the thyroid in a surgical procedure called a thyroidectomy or avoid surgery and continue to experience the discomfort and risk having the nozzle turn malignant. Permanent removal of this important gland, which controls blood pressure, body temperature and heart rate would limit hormone production and lead to lifelong hormone replacement therapy along with a visible surgical scar. Each year in the United States 250,000 patients are diagnosed with benign thyroid nodules.

Out of this annual incident population, approximately 150,000 patients elect to undergo a thyroidectomy. The remaining 100,000 patients choose to live with their condition and wait for an alternative treatment. At this point, we estimate the prevalence of watchful waiting patients with benign thyroid disease to be approximately 2 million patients. As such, the risks of surgical thyroidectomy leave this patient population severely underserved and with high interest in a safe, non-surgical alternative. Clinicians now have the opportunity with nanosecond PFA therapy to treat benign thyroid nodules less invasively while preserving the thyroid gland and its function. Pulse Biosciences expects to see nanosecond PFA become a principal alternative and eventually first-line therapy for benign thyroid nodules.

The unique properties of nanosecond PFA enable a non-surgical safe, scarless, thyroid preserving treatment for patients, delivering nanosecond PFA energy via the Percutaneous Electrode allows physicians to treat only the irregular nodule without impacting the greater thyroid or the surrounding clinical critical anatomy. The non-thermal ablation therapy delivered by nanosecond PFA can be safely delivered within the sensitive surrounding structures of the thyroid with no risk of thermal damage. We believe nsPFA can replace thyroidectomies and attract patients from the watchful waiting pool to seek non-surgical treatment. We are very pleased by the quality of the preliminary data from our First-In-Human Feasibility Study conducted in Italy and presented at the American Thyroid Association 2024 Annual Meeting.

The data presented on 30 patients in three distinct cohorts demonstrated our system’s effectiveness in reducing nodule size. In Cohort 3, three patients received complete nodule treatment and achieved on average 83% volume reduction at one year and significant reductions in symptoms just one month after treatment without evidence of residual fibrosis or scarring that would routinely accompany radiofrequency ablation. Our Italian study, along with data from our ongoing U.S. pilot program, will inform the design of additional market expanding clinical trials to commence later this year to seek regulatory clearance for the device specifically as a treatment for benign thyroid nodules. Looking further out into the future, we intend to explore other clinical indications for the use of our novel percutaneous electrode ablation device in soft tissues beyond the thyroid.

Additionally, at the North American Society for Interventional Thyroidology Annual Meeting in January of this year, one of our KOLs presented encouraging early data from our pilot program that continue to demonstrate the safety and effectiveness of our nanosecond percutaneous electrode system in benign nodules. Our nsPFA system is currently being used in eight centers in the United States as part of a pilot program generating data that will allow us to scale our new therapy consistently. These clinicians are refining procedural techniques and optimizing therapy delivery for our novel procedure. We expect most of these clinical users will convert to using our nanosecond PFA percutaneous electrode on a commercial basis over the next several months.

We are now hiring our first commercial resources, including capital equipment system sales and therapy adoption managers. We have identified a pipeline of target sites based on thyroidectomy volume and interventional ultrasound guided procedure capabilities. The sales process will consist of a capital sale of the console, training on device usage and then treatment of an initial cohort of patients with some follow-up and finally, regular commercial use within the practice. Given the absence of therapeutic alternatives in the category, our product launch will not face entrenched competitive resistance. Our initial interactions with qualifying accounts indicates strong interest for pulses nsPFA advanced therapy. Given the strong clinical outcomes with nanosecond PFA, there is a pathway to favorable procedure reimbursement and economics.

Other percutaneous technologies that are not commonly used have reimbursement, boosting our confidence in achieving reimbursement commensurate with the clinical value provided by nsPFA. Our goal over the next quarter is to continuously expand our pipeline of interested accounts and our installed base of users. We will share details on our commercial progress in the coming quarters. That leads us to our surgical ablation clamp. Our first immune feasibility study for the surgical cardiac clamp to treat atrial fibrillation is underway in Europe. During the past quarter, we opened a third study site in The Netherlands and have now treated 30 patients. We are encouraged by the acute performance of our cardiac surgical ablation device. The procedures were completed efficiently, and we expect to share preliminary results of the trial in late 2025.

In December, the Journal of Thoracic and Cardiovascular Surgery published results of our preclinical study, which demonstrates the advantages of the nsPFA cardiac surgical system over radio frequency technology for the ablation of cardiac tissue. The study was designed to demonstrate the safety and effectiveness of the new nanosecond pulse field ablation parallel clamp in ablating different cardiac tissue locations. Results validated the expected benefits of nsPFA as all lesions produced by this novel technology were durable, contiguous and transmural, producing chronic exit block of pulmonary veins with no collateral damage to surrounding tissue. We are very proud to have had these data published in the leading scientific journal in the field and look forward to generating human clinical data on par with our positive preclinical outcomes.

As a reminder, the FDA awarded breakthrough device designation for our cardiac surgical clamp ablation device in July 2024, as well as inclusion in the FDA’s total product lifecycle advisory or CAP program. We are actively engaged with our FDA review team regarding the design of our IDE pivotal clinical study and plan to submit a formal IDE to the FDA for this study by mid-year, followed by commencement of a pivotal clinical trial. Now moving on to our 360 Catheter system for AF ablation. Our third product currently under development is also intended for the treatment of atrial fibrillation. Our 360 cardiac catheter system is designed to deliver nanosecond PFA technology in endocardial applications to treat AFib. Over 1.9 million patients are diagnosed with AF annually in United States, creating an estimated $3 billion annual U.S. market solely for ablation catheters.

The benefits of PFA are impactful and are driving significant change in the AF treatment landscape. It is estimated that in 2024, the first year of commercialization in the U.S, PFA was used in 20% of global AF cases, which will expand to 40% to 50% in 2025. PFA effectiveness has also disrupted the linkage between ablation and mapping navigation systems, allowing them to be used separately on a routine basis and further changing the competitive dynamics in the EP catheter space. From our observations, the benefits of nanosecond PFA represent another leap beyond current PFA. Our 360 holds the conferential catheter breaks current treatment paradigms. By delivering less energy than required by conventional PFA systems, we produce a more pliable electrode array that delivers a full ring shaped lesion in a single energy delivery of several seconds without needing to move or rotate the catheter.

Other competitors create focal ablation points, not complete rings, increasing the time, complexity, burden and the skill required to perform the procedure. Because of the extremely short duration pulses, there also appears to be much less neuromuscular stimulation with nsPFA. Unlike other PFA devices, nsPFA requires no cardiac synchronization and no need to use paralyzing drugs to keep the patients from abruptly moving on the table during the procedure. Also, we produce deeper electric fields that can result in fully transmural lesions, that is lesions that penetrate fully through the wall. Because of this much deeper electric field, our catheter is also much less sensitive to positioning requirements. For all these reasons, we believe our technology has the ability to deliver a faster, safer treatment with quicker recovery times and less anesthesia.

We believe we have a significantly differentiated technology that could again disrupt the AF treatment landscape in a similar fashion to what microsecond PFA is doing now. We also understand robust clinical evidence is required to validate our observations and drive clinical adoption. Our late breaking data from our first in human feasibility study presented by Doctor Vivek Reddy at the AF Symposium in January is the first step in that direction. Early results were exceptional. Over 80 patients have been treated by eight investigators, including Doctor Reddy and Professor [Neusel] (ph) in cases performed in Na Homolce Hospital in Prague and Doctor Johan Wiegand in Esi Hospital in Hasselt, Belgium. The initial cohort of this first 30 patients treated have been evaluated by remapping completed at three months following the ablation procedure with additional data to be presented at the Heart Rhythm Society meeting in Q2 of this year.

The results of this study demonstrated that 100% of lesions were acutely successful in conduction block. We are continuing enrollment in multiple centers and are excited to add new centers in 2025. We are very pleased with the progress we’ve made on our first three devices and therapeutic applications. We are poised to enter three large and growing markets with differentiated technologies backed by strong clinical evidence. To ensure we efficiently make the maximum impact possible on these markets for the benefit of patients, we are implementing a hybrid business model. Our evaluation of the market entry requirements in each therapeutic category will determine whether we approach each directly or with the support of a commercial partner. For a less competitive and less complex market, we will build our own commercial team and go direct.

In others, with multiple established players and additional market complexity, we will partner with market leading companies in mutually beneficial arrangements. We believe this approach will be the most capital efficient path to market. We will accelerate the path of nsPFA to patients and will allow Pulse Biosciences to pursue multiple clinical opportunities without taking on overly challenging commercialization complexity. Before passing the call over to Jon to cover the financials, I’d like to provide a brief introduction. Jon is a very strong addition to our team with experience leading the FP&A, accounting, sales operations, strategy, partnerships and M&A functions at both growth stage private and diversified public MedTech companies.

His leadership has already proven to be extremely valuable in our efforts to advance our nanosecond PFA technology platform and Jon has already in under two months become an integral part of our team. Jon?

Jon Skinner: Thank you, Paul. I’m extremely excited to join Pulse Biosciences and contribute to the development and commercialization of our nanosecond PFA devices to advance the treatment of several disease states. It is clear the team and the technology are world class and the opportunity set ahead is quite unique. We are establishing the foundation from which we can drive disciplined growth and operational excellence as we scale this business. Now I will highlight our GAAP and non-GAAP financial results. I encourage listeners to review today’s earnings release for a detailed reconciliation of non-GAAP measures to the most comparable GAAP measures. In the fourth quarter of 2024, total GAAP costs and expenses increased by $7.7 million to $20.3 million compared to a $12.5 million in the prior year period.

The increase in GAAP costs and expenses was primarily driven by an increase in non-cash stock based compensation, which was $6.8 million in the fourth quarter of 2024, compared to $3.3 million in the prior year period, along with other compensation and administrative expenses to support the expanding organization and advancement of our nsPFA devices, along with severance and legal settlement expenses. To remind everyone, non-GAAP costs and expenses exclude stock based compensation, depreciation and amortization, restructuring, severance and legal settlement expenses. Total non-GAAP costs and expenses in the fourth quarter of 2024 increased by $2.4 million to $11.3 million compared with $8.9 million in the prior year period. GAAP net loss in the fourth quarter of 2024 was $19.4 million compared to $11.9 million in the prior year period.

Non-GAAP net loss in the fourth quarter of 2024 was $10.4 million compared to $8.3 million in the prior year period. In the fourth quarter, we strengthened our balance sheet considerably through the exercise of warrants related to the rights offering that was completed in July of 2024, raising an additional $47.9 million in net proceeds. Through the end of 2024, $49.4 million of warrants have been exercised. As of December 31, 2024, cash and cash equivalents totalled $118 million compared to $44.4 million as of December 31, 2023. Cash used in the fourth quarter of 2024, excluding net proceeds from financings, totalled $9.3 million compared to $6.9 million used in the prior year period and compared to $8.5 million used in the third quarter of 2024.

Now joining us for the question-and-answer session is Bob Duggan, Co-Chairman of the Board. Operator, please open the call for questions.

Operator: Seeing as we do not have any questions at this time, I will now turn the call back over to Paul LaViolette for closing remarks.

Paul LaViolette: Well, thank you all for joining. We’re proud of our accomplishments, and we look forward to providing you an update on our first quarter performance at a call to be scheduled in early May. Thank you very much.

Operator: Ladies and gentlemen, that concludes today’s call. Thank you all for joining. You may now disconnect.