The ISX this morning. From the company today, we have the Founder and Managing Director, Steve Wedan, the company's Chief Financial Officer, Jon Gut, and the company's VP of Corporate Strategy, Nick Corkill. Before I hand it over to Steve to go through the presentation, I'll just remind you that you can submit a question through the Q&A button at the bottom of your Zoom screen, or alternatively, for analysts, you can raise your hand and allow you to talk your question. Steve, I'll hand it over to you now. Thank you.
All right. Thanks, Simon. Hello, everyone. Thank you for joining us today to discuss Imricor's full year results for 2024. For those new to our story, Imricor is the global leader in designing and manufacturing MRI-compatible interventional tools and equipment that enable physicians to harness the superior imaging capabilities of MRI during and throughout interventional procedures. Our initial focus has been on electrophysiology, specifically cardiac ablation, which is a rapidly growing market approaching $10 billion annually. When we started, the development of MRI-compatible devices for cardiac ablation presented a significant technical challenge, requiring unique insights that only Imricor was able to provide, which is why we are the only company in the world now to succeed in making MRI-compatible ablation catheters and other devices that are needed for these MRI-guided procedures.
Our goal to move cardiac ablations away from X-ray and into MRI also requires the development and approval of many different devices, essentially every device you need to perform one of these ablation procedures. We had to develop all of them from scratch to be uniquely MRI-compatible based on our platform, technology, and our expertise. This is something many companies, large and small, have tried to do over the years, but only Imricor has succeeded. Many companies tried because the promise of MRI-guided cardiac ablations has always been to deliver faster, more successful procedures at lower cost and with improved safety. Now, keeping in mind that securing regulatory clearance for a single medical device is a major milestone for any company, consider that for Imricor, the task of that milestone and of approval is even greater.
That's because our approvals encompass an entire platform of devices, including multiple consumable devices, capital equipment, and soon the world's only MRI-native interventional mapping and guidance system we call Northstar. We've successfully received approval for our platform in Europe and in the Middle East, adding Northstar to the roster of approved devices in those places pretty soon, and we are progressing the approval process with the FDA in the US right now. Each approval reflects years of rigorous development and extensive regulatory documentation involving thousands of pages, and I want to take a moment to commend our regulatory and quality teams whose exceptional work continues to drive progress, and I look forward to celebrating new approval milestones with them, the broader team, and our shareholders throughout 2025. The most exciting news is that the technology is fully developed, proven safe, and delivering outstanding performance.
We are now in the early stages of global commercialization, expanding our footprint and unlocking value for patients and physicians worldwide. Those of you who have been following us for a while will know that we are not stopping at cardiac ablation. As more doctors gain experience using the technology, the applications continue to expand. An MRI-guided biopsy tool is one example that is often requested and is in our product roadmap. Beyond this, there are potential applications for renal denervation, which is a treatment of hypertension, and further potential applications in structural heart, oncology, neurology, and on and on. On the software side, Northstar is emerging as the central guidance system for MRI-based interventions with potential diagnostic applications that can open an entirely new market of significant scale.
The first 19 slides of our deck today provide background information that is just really for reference purposes because today I'll focus on our key achievements in 2024, starting from slide 20, before handing it over to John to discuss our financials. I will provide an update on the significance of what we're doing, of doing the first VT case, growing our pipeline, Northstar and its approval pathway, as well as outline the major milestones ahead of us for 2025. We'll leave ample time for Q&A after the presentation. This slide summarizes some of our major accomplishments in 2024. In short, we've made significant regulatory progress in both Europe and in the U.S. Notably, we received CE mark approval for our Diagnostic Catheter under the new, more stringent European medical device regulations.
Just a short while ago, we followed that up with the CE mark of our second-generation ablation catheter. We have submitted Northstar, our 3D mapping and guidance system, for CE mark approval, and we expect to commercialize Northstar in Europe in the second half of this year, 2025. In the U.S., we are making excellent progress with FDA's modular review process. Our regulatory team is overseeing the approval pathways for more than a dozen products, and I want to again extend my appreciation to Jen Wise and her team for their exceptional work. In Europe, we are preparing for one of the most significant milestones in Imricor's history, the first-ever MRI-guided VT ablation procedure, a transformative step for the field and something I will touch on more later. Beyond regulatory processes, we continue to establish Imricor as a truly global healthcare company dedicated to revolutionizing cardiac arrhythmia treatments.
A key milestone for me personally in 2024 was the first MRI-guided procedure performed in the U.S. at Johns Hopkins University, where the concept of MRI-guided interventions was first conceived over 20 years ago. Additionally, we have commenced procedures in Switzerland and Croatia, with Hungary set to begin shortly, and in the Middle East, following recent approvals, we received our first purchase order from Qatar. I have to say that I'm particularly pleased with the caliber of talent we have attracted to our sales team, and their efforts have significantly expanded our pipeline, both in terms of new site engagement and progress towards new hospital adoption. With that, I'll now hand it over to John to walk through the financials.
Thank you, Steve. And hello, everyone. As a reminder, all numbers are in US dollars. As set out on slide 22, we generated total revenues of $959,000 for the year, which was up 56% compared with the prior corresponding period. The increase was driven by double-digit growth in both equipment and consumable revenues, including the first sale of consumable devices in the Middle East. The initial Middle East order also included equipment, but that revenue is expected to be recognized in 2025 following installation at the site. Equipment revenues of $306,000 were up 109% compared to the prior corresponding period. For consumable product sales, revenue of $461,000 was up 59% compared to the prior corresponding period and benefited from the Middle East order received during Q4.
While we experienced strong top-line growth during the year in percentage terms, this is just the beginning of our re-commercialization efforts, and we are excited about the significant potential for continued growth moving forward. It is worth noting that some of our European sites are exclusively enrolling patients in the Visible AFL trial to support FDA approval, and these have not been revenue-generating procedures. Additionally, several Philips hospitals are expected to commence procedures later in 2025 following the release of their R12.3 software update. This is the update that will support the rollout of our Northstar mapping system on the Philips platform once the Northstar system is approved under MDR, which is expected to be received in the second half of this year. Costs and non-R&D expenses continue to be well-contained in 2024 and decreased by $502,000 or 5% compared to the prior year.
This reduction was primarily the result of continued decreases in D&O insurance premiums and charges for new inventory reserves. R&D spend for the year increased by $247,000 or 3% in comparison to the prior year, primarily due to targeted investments in staffing and an increase in product development costs related to the FDA approval process. These increases were partially offset by a decline in the regulatory compliance costs as our second-generation products progressed through the final stages of MDR approval in Europe. The fair value change recognized in the current year is primarily related to the convertible notes and warrants issued during 2022 and 2023. The change in the fair value of these liabilities correlates with the movement in our stock price, and the larger charge recorded in 2024 parallels the increase in our stock price that occurred during the year.
This accounting adjustment does not have a direct impact on future cash flow. The net loss for the period was $29.7 million, an increase of 31% from the prior year, which was driven by the fair value change. Adjusted for this, our underlying net loss for the period would have been $15.6 million, a decrease of 7% compared to the prior year's adjusted net loss of $16.6 million. Our balance sheet is provided on slide 23. Regarding significant changes in the balance sheet, the decrease in accounts payable reflects the payment of the non-recurring invoices for third-party equipment inventory and regulatory compliance costs that were received during the fourth quarter of 2023. The decrease in other current assets is primarily due to the lower D&O insurance premiums, which are prepaid during the third quarter with funds obtained from a financing obligation.
Contract liabilities represent deferred revenue where Imricor has at least one future obligation to be met before the revenue can be recognized. The outstanding convertible notes at the end of the period are recorded at their estimated fair value of approximately $19.9 million. It is important to note that this valuation does not represent the amount to be paid if the notes were settled in cash on their maturity dates. The outstanding principal and accrued interest at December 31 totaled $6 million. The option and warrant liabilities relate to securities issued as part of the financing activities completed in the second half of 2023 and are also recorded at their estimated fair value in accordance with US GAAP. Moving to cash flow on slide 24. Our operating cash outflow for the year amounted to approximately $15.6 million, showing an increase of $2.6 million compared to the prior year.
This increase is primarily driven by the decrease in the accounts payable balance at December 31, which increased our cash flows during the period. During the year, we completed two equity placements and a rights offering, which resulted in gross proceeds of approximately $32.9 million. At the conclusion of the period, our cash balance stood at $15.7 million. Now, I'll turn it over to Steve to continue with the rest of the presentation.
Thanks, John. I'd now like to discuss some of the upcoming value drivers for 2025. Let's talk for a moment about ventricular tachycardia, or VT ablations. VT ablations have some of the poorest outcomes when used in conventional X-ray-based guidance, and physicians consistently tell us that MRI has great potential to add value to this procedure, both in terms of the duration and the effectiveness, given its superior ability to visualize the tissue characteristics that cause the arrhythmia. We believe the upcoming Visible VT clinical trial could provide the data necessary to redefine the standard of care and drive widespread adoption of ICMR labs globally. An interesting study published in a cardiac medical journal called Circulation, Arrhythmia, and Electrophysiology demonstrated the benefits of MR imaging for VT procedures a while back.
While this study used pre-procedural MRI imaging uploaded to conventional mapping systems rather than using real-time MRI guidance like we're talking about, it still resulted in significant improved procedure times and outcomes. By implementing real-time MRI guidance, as we are pioneering, we expect even greater benefits. These advancements, along with growing physician support, reinforce our confidence in the transformative potential of MR-guided VT ablations. Northstar also represents a major step forward. This system has the potential to become the central hub of every ICMR lab, generating both upfront licensing revenue and annual recurring fees at a software-like margin. The inbound demand from physicians has been highly encouraging, leading to the acceleration of our CE mark and FDA submissions. We anticipate CE mark approval by mid-2025 and FDA clearance in Q3, positioning Imricor for its first US sale and expansion into new hospitals shortly after approval.
We're also excited about the recently announced licensing agreement we signed with ADAS 3, a Switzerland-based developer of cardiac-focused AI applications. We already had a joint technical development agreement in place with them to develop AI modules for integration with Northstar, and we believe that these and more AI capabilities will position Northstar to be the vehicle through which we increasingly harvest the benefits of MRI for patient treatment across many medical specialties, including, of course, cardiac ablation. A third area I want to highlight as we look ahead to 2025 is our pipeline of sites. We have strategically expanded our sales team, and the impact of that has been significant. Our pipeline in Europe has more than tripled since mid-2024, while our Middle Eastern pipeline has more than doubled. As hospitals, capital budgets recover, and awareness of Imricor's technology grows, again, we expect momentum to accelerate.
There is also an upcoming Philips software update that will allow Philips MRI systems to gain connectivity with Northstar. This will unlock existing hospital sites with Philips-based ICMR labs and also open the door for additional hospital adoption. I'd like to conclude our prepared remarks highlighting the overall outlook for 2025. On the regulatory front, we expect to have several major announcements as we complete various submissions and gain new regulatory approvals both in Europe and the US. As I mentioned earlier, this is an entire platform of technology with over a dozen products going through the process, so it is likely there will be many milestones to announce throughout the year. The biggest item in the very near term is the first-in-man ICMR-guided VT procedure to be performed at the Amsterdam University Medical Center. To start this program, it has taken significant partnership, development, approvals, and planning.
We are delighted with the engagement and excitement from the entire team at Amsterdam, and I genuinely believe that we will refer to Imricor's journey as the time before VT and the time after VT. It really is that significant, and the procedure is highly anticipated by both physicians and the industry globally. We expect to continue to add new customer sites across Europe and the Middle East throughout the year, and we will communicate those as they close as well. The second half should see a pickup in the cadence as Philips hospitals can finally connect to Northstar following the scheduled software upgrade from Philips. Finally, Imricor is making steady progress in starting our pulse field ablation, our PFA program. PFA is an exciting new energy source being used for ablation.
Our team has already ablated using PFA as an energy source in preclinical feasibility studies using our existing catheter, and we are excited to move this important project forward. Even as PFA grows in popularity with physicians, the technology's limitations are also coming better into focus, and we believe MRI will bring the same value to PFA ablations as it does to RF ablations. We believe that no matter what energy source doctors use, MRI can provide a procedural endpoint that tells the physician when enough ablation has been given, but not too much ablation. With that, I'd like to thank our dedicated team at Imricor for their hard work, our MRI partners at Siemens, Philips, and GE, and of course, our physicians and shareholders for their support in advancing this exciting new field.
Now I'll turn it back over to you, Simon, and we're happy to take any questions.
Great. Thanks very much, Steve. Just a reminder, if you did want to ask a question, please submit it through the Q&A button at the bottom of your screen. The first question is from Sarah Mann at Moelis. Sarah, please go ahead.
Morning, guys. Can you hear me okay?
Sure can.
Great. Thanks for the presentation. The first question from me is just on the Flutter trial in the U.S. Cognizant that obviously you can't comment directly on how the trial's progressing from a recruitment perspective, but can I firstly confirm that you're still tracking to, I guess, have approvals and kind of first sales in the second half of this calendar year? Secondly on that, can I confirm that there's three sites participating and just wondering if there's intentional interest from other hospitals to join the clinical program as well?
Yeah, how about this, Sarah? I'll answer those in reverse order. Good morning to you as well. A fourth site will start up in Amsterdam. We actually hoped that they would start a couple of weeks ago, but the approval from METC didn't come through quite in time. That will be our fourth site. That's a site that does commercial cases clinically on an ongoing basis. We'll just replace those commercial cases with Visible AFL cases. At the other three sites, the enrollment is accelerating. We never wanted the clinical trial to be the long pole in the regulatory process, and it still isn't. We're happy with how the trial is progressing and everything's still on track.
When it comes to regulatory approval, you know there's things we can control and things we can't control, but we're still tracking toward second half of this year approval from FDA. Like I mentioned earlier, and I think we put in an announcement previously as well, we swapped the order a bit. Northstar, which is a 510K product, will be submitted first, and we pushed a couple of other things out just a little bit so the team could work on Northstar because we believe that when Northstar can get 510K approval well ahead of the rest of the technology, and there is a market with inbound interest for Northstar already. We're going to sort of step that up and put that in front.
Great. Thank you. That makes a lot of sense. The other question is just on the European FETA trial. I mean, you've kind of called out that it should happen pretty imminently. Is there anything that needs to happen before procedures can commence? Firstly, and then secondly, are you getting much inbound interest from other sites potentially looking to join FETA as well, given that it's, I guess, such a groundbreaking procedure?
We do. We are getting inbound interest, and we're working with all those sites to try to get them set up so they can participate in the trial. The answer to the first part of the question is, yeah, there is a lot of new stuff in a VT procedure. The first time of transseptal crossing, the Gen II catheter, the second-generation ablation catheter as opposed to the first-generation ablation catheter, and of course, an entirely different part of the heart to be working in with a sicker patient population. We have been working with Amsterdam to try to get as many of the new tools worked with and comfortable before taking the step over to VT. To that end, a whole team of them are coming for a whole week. Not practicing medicine, but taking that time off, that's how important it is. They're coming to Minnesota.
We're going to do a series of preclinical studies with all of the new tools to give them the repeated access and practice with these new devices, make sure everyone's super comfortable, and then we'll go back and two weeks later do a series of multiple days in a row of Flutter cases followed by the first VT case. It is planned. It is well planned, I should say, and we're executing right now to that plan. It is coming. More than anything, we want to make sure that it's successful and is the great procedure that it can be even though it will be the first-in-man study.
Great. Thank you. Final one from me. Nice to see that your European pipeline is growing. Can you give us a rough breakdown as to what % of the sites in that pipeline are Philips versus Siemens? Because presumably, if the Philips sites are still waiting for the software release to come through, once that comes through, potentially your pipeline could accelerate again, or is it currently like a reasonably even mix between two MR OEMs?
Yeah, the pipeline is growing actually with brand new sites. That is one thing. There is also an activation of sites. Talking about the activation sites, we have a lot of Philips sites. For a while with iSweet, that Philips had developed being the sort of front runner prior to Northstar existing, we were really kind of pushing for Philips adoption because that is the system that you could most quickly and easily move to complex ablations like participating in the VT trial. Once iSuite was pulled back and we developed Northstar to replace it, that sidelined all of those sites. We pushed for Philips sites for a while, and then they are all sort of sitting there waiting for the next software release from Philips to allow connectivity to Northstar. We will activate a bunch of sites as soon as that software is released.
Also, as we look at the pipeline, it's always a matter of whether a hospital or a site that's interested in doing this happens to be a Philips site or a GE site or a Siemens site. Having the Philips sites not be able to connect to Northstar kind of limits that pipeline. That will continue to grow as well.
Thank you very much.
Sarah, Nick here. I might just add that it's broadly represented by the market shares of both of those companies. As I look through the pipeline, it's pretty much a pretty even split as it is in the market.
Thanks, Nick. Thanks, guys. Appreciate the feedback.
Thanks, Sarah. Next question is from Scott Power at Morgans . Scott, please go ahead.
Thanks, Simon, and good morning, Steve and the rest of the team. I just want to keep trying to get your comments more on Northstar. You talk about it as the central hub. I just want to just double-check what you said in terms of the timing of approval. European by mid-year and US approval by Q3 Is that correct?
That's where we're shooting for.
That's where you're timing. Okay. Can you just sort of talk a little more about the revenue opportunities that you're seeing there? You spoke about licensing opportunities. Can you expand on that and just how we should think about that in terms of the use of the product in the cardiac setting, plus perhaps in alternative settings?
I don't want to tip our hands kind of too much to some of the really cool ideas we have about how Northstar can expand beyond just cardiac ablations. When I say a central hub, what I mean is it is the thing that it's the vehicle through which we're not just going to say we can do these procedures in MR. We're going to start to harvest the value of why we should do these procedures in MR. When you look at harvesting that value for cardiac ablations, for instance, or cardiac biopsies or structural heart delivery systems or renal denervation, that's one thing. There are also other, as we build AI into tissue assessment of diseased, I don't want to say heart because it's beyond the heart.
As we look at the tissue assessment capabilities and the AIs that we'll be building into this, we think that this can have real great application towards directing therapy across other things, even if there isn't an interventional product in that equation. It's a little obscure. I apologize, but again, I don't want to announce some really cool things that we're thinking about doing. What we do know in the really short term is there are a bunch of pediatric sites across the United States, for instance, who are trying to do simple diagnostic right heart catheterizations or left heart catheterizations. These are pressure measurements that they take on kids who need to have reconstructive congenital heart surgery. As they do these, they have to do a bunch of them. It's so important to minimize radiation that they're doing these in MR.
It's harder to do in MR than it is in X-ray. With Northstar, we can give them an interventional environment that will let them more easily do these procedures. As I mentioned earlier, we're getting a lot of inbound interest. Northstar has a way to kickstart itself pretty quickly. That's great for us as well because as a pediatric center starts adopting Northstar and using it for these procedures, there's always, of course, an associated adult hospital with that children's hospital. That's a great exposure for us to get for our sales team to get in front of the EPs and the adult hospital as well. It all should build on itself quite nicely.
Great. Okay. Just a final question for me, just in terms of the progress with the TGA in Australia.
We just got that. You saw the announcement recently that we got the second generation. You might recall that last year, it was taking so long to get the first-generation approval complete, and they were looking for a little bit more clinical data, so on and so forth. It didn't make any sense at that point because we were going to, the potential was to get approval of the first-generation catheter in Australia just as the second-generation catheter gets approved everywhere else in the world. That approval is just now happening. The second-generation catheter is the one that's under approval for FDA, and it's the one that just got approved in Europe. It's the one that's being used in the Visible VT trial. As we get indications for VT, that's the catheter that will have them, not the first-generation catheter.
We pulled that back, and we were told by our consultants with TGA that they value the new medical device regulations more than they value CE marks under the old medical device directive. Our first-generation catheter was cleared under the medical device directive. We think and thought and think now that a good strategy is to, now that we have an MDR cleared, medical device regulation cleared Gen II catheter, we can go back to TGA and try it again and streamline the process. That is the plan now. I can't put a timeline on it. Obviously, the timeline last time surprised us quite a bit, but we think we have a pretty good path forward.
Great. Thanks. That's all my questions.
Great. Thanks, Scott. Steve, the next question. What is the potential in entering the Asia-Pacific market, specifically mainland China? There are just over 20,000 MRI units installed throughout Chinese hospitals. Being mindful of IP protection, is there any vision or initiative to enter this ecosystem considering its enormous potential for Northstar and consumables alike?
Yeah, there's definitely vision, but I can't say that there's an initiative to do it right now. We've got our hands full with two global clinical trials and commercialization across the two largest markets that we have in front of us, being Europe and the US. Obviously, China in particular is a great place for us to direct our attention pretty soon.
Thanks, Steve. Just final question. Any early works done in ablation treatment of atrial fibrillation, potentially much larger market?
Yeah, that's what the PFA is all about. I've talked in the past about how we start with atrial flutter, and that establishes a platform and gets that approved. As we study and move to more complex ablations like VT or AFib, we're only studying the ablation catheter itself. We had this choice before, many years ago, actually, what do we do next? Do we go to AF, atrial fibrillation, or do we go to VT? We chose VT because, one, it's a miserable procedure conventionally, and we think that MR has just such tremendous value to add to that. The imaging is so straightforward, and it's just a really easy value proposition.
Doctor after doctor would say, "Yeah, I can really sell this to be great for VT." At the same time, I started the company really with AF in mind and utilizing MRI to detect whether we've got gaps and lesions and things like that. At that time, we also saw pulse field ablation coming. I thought, "This would be unfortunate if we got this whole RF ablation system through an AFib trial, which is a much larger trial with longer follow-up, hundreds of patients with 12-month follow-up." We do all that work, and then just to get sort of leapfrogged by pulse field ablation, which is, and AFib is where pulse field ablation is really focused. RF ablation is still going to be the thing for the ventricle for lots of technical reasons.
I think that was a good choice because now, as we drive forward our PFA program, that will be focused on AF.
Great. Thanks, Steve. That concludes the Q&A segment. I'll just hand it back to you for closing remarks.
Thanks. I just want to thank everybody for joining us today. Again, we really look forward to, I mean, last year was about setting ourselves up for success, and we did it. Now we're looking forward to a really, really exciting 2025. You can feel it in the air in here. You can feel it in the field as we talk to hospitals and doctors. We look forward to sharing it with all of you. Thanks so much.