Hansen Medical, Inc.
President and CEO: Cary Vance
WSA: Good day from Wall Street. This is Juan Costello, Senior Analyst at the Wall Street Analyzer. Joining us today is Cary Vance, President and CEO of Hansen Medical Incorporated. The company trades on NASDAQ ticker symbol HNSN. Thanks for joining us today there, Cary.
Cary Vance: Thank you. Great to be with you Juan.
WSA: Great. Now, starting off, please give us a history and overview there of Hansen for some of our listeners that are new to your story.
Cary Vance: Sure, Juan. We were founded in 2002 and we’ve been publicly traded since 2006. We’re based in Mountain View, California. And essentially, we’re the global leader in intravascular robotics. So, we develop products and technology that are designed to enable accurate positioning, manipulation, and control of catheters and catheter-based technologies. We were originally established as a robotic platform for electrophysiology for the treatment of atrial fibrillation. And over those years, we’ve done over 15,000 robotic procedures in that area.
Our second robotic platform is the Magellan Robotic System which was CE marked and 510(k) cleared a few years ago, along with our 9 French Magellan Robotic Catheter. Now, over the past several months, the Magellan 6 French Robotic Catheter was CE marked and 510(k) cleared, and we also anticipate a 10 French catheter to gain approval in the next few months. So, the system, the catheters, and related accessories are intended to facilitate navigation to anatomical targets in the peripheral vasculature. And subsequently, they provide a conduit for manual placement of therapeutic devices. And overall, our company’s mission is to enable cardiac arrhythmia and endovascular procedures to improve patient outcomes through the use of these intravascular robotics.
WSA: Great. And so, can you talk about the — you know, the exciting news that you put out last week regarding the first intravascular robot-assisted IVC filter retrieval?
Cary Vance: Yeah, I mean, the IVC filter retrieval is just a part of the many vascular procedures that our Magellan system and associated catheters are able to accomplish because essentially, the robot along with the guided catheters provides both predictability control, and control, as well as catheter stability as the physician is trying to navigate. And in the case of IVC filter, that type of retrieval is a complex procedure that requires navigation and stability within some petty torturous anatomy to be able to retrieve those filters, and that’s a procedure that’s very difficult to do, if not impossible to do at times manually. And so, it really is a kind of breakthrough for patients who have embolization issues and physicians who struggle with helping them.
WSA: Right, right. Well, yeah, what are some of the other key trends that you’re focusing on right now in the sector and how is the company positioned there to capitalize?
Cary Vance: Well, you know, I believe our technology and our company is able to address a lot of the key trends and the key issues that hospitals are facing these days. First and foremost, the economics, most hospitals are challenged these days with kind of the economics of their facility or their system, and our technology really helps them in both revenue-generation and cost containment.
From a revenue generation perspective, our technology allows for new procedures and a disruption or referral patterns, an increase in referral patterns to their facility. From a cost containment standpoint, many of our customers have told us that our technology is able to decrease length of stay, decrease complications, decrease fluoro times, decrease contrast usage, and allows them to have predictable procedure times and lab scheduling which really in the key process center for them in their facility is crucial for both cost containment and revenue generation.
From a clinical standpoint, I think we talked about the IVC filter but there are many, many procedures that can be done with the Magellan System and our Magellan Robotic Catheters that they weren’t able to do before, weren’t able to do it effectively before. So, clinically, physicians are discovering new things that can be done, and as a result, the patients are benefiting by both safer and more effective procedures.
And, you know, speaking of safety both for the patient and the clinician, you know, physicians are more and more concerned with — interventional physicians are more and more concerned with both orthopedic and radiation safety issues. So, this — a lot of these procedures, they are standing in the room quite often in awkward positions if they’re performing these procedures manually sometimes for hours.
Cary Vance: And over time, they complain of back and neck issues, and they have radiation concerns because they’re in that radiation field for long periods of time, and our technology allows them to sit at a console outside the radiation field, sit comfortably, and drive the catheters through the vasculature in a comfortable and safe fashion.
And then, competitively, you know, hospitals are looking for ways to compete in their markets to be able to draw patients from other facilities, and this technology allows them to offer something that quite often other hospitals cannot.
WSA: Certainly. And anything else you feel makes the company unique and your product from some of the other players in the sector?
Cary Vance: Well, I mean, truly, we are the only intravascular robotic catheter and robot system company in the sector. So, we compete more often than not with other ways of dealing with disease states such as surgical procedures or medication. We also compete with currently, physicians performing procedures manually.
And so, for us, our competition is the way things are currently being done or the way things have always been done. And we assert that our company and our product is unique and is a game changer in so many areas of the body, whether it’s brought into embolization procedures and various vascular procedures, atrial fibrillation, we believe that we’re the most innovative company in the space and that we have extremely strong IP, and not only on our technology but to operate within the peripheral vasculature.
WSA: Yeah it’s a pretty niche market right now–and so what are some of the key goals, milestones, and initiatives that you’re hoping to accomplish here over the course of the next six to 12 months?
Cary Vance: Well, as I mentioned, we expect in the next two or three months to have a new 10 French Magellan Robotic Catheter to allow new procedures in our vascular space, and it adds to a family of catheters that we intend to continue to add to over time which allows physicians to go to different parts in the vasculature and deliver different types of therapies.
We also, in our electrophysiology business, are in the process of concluding an IV study that we’ll be submitting to the FDA in the coming months that will give us, we believe, a strong indication for the treatment of atrial fibrillation in the US which we already have outside the US, and we believe that that will be important for us as we market our EP business, but more than anything, what we expect is a ramp up of system sales globally.
We have a global expansion strategy, which we continue to grow in global markets. We continue to expand to new global markets and we expect that with all the systems that we currently have out there that we will sell in the current year, we expect greater utilization because we’ll have more systems out there but also because within a hospital that has a system, we will have more physicians using it, we will have each physician using it for more and different procedures. And again, we expect to ramp up in terms of our revenue growth and in terms of our expansion not only globally but to build a group of customer advocates that will help us get to a tipping point in the business in the coming few years.
WSA: And perhaps, you can walk us through your background and experience, Cary, and talk about some of the key management.
Cary Vance: Sure. I’ll address my team first that we have an outstanding management team here. All have between 25 and 30 years of experience, almost all in healthcare and med device. They’ve worked for both small and large companies so they understand what it’s like to build a business but they also understand what it’s like to navigate within large business. They’ve worked for companies like Abbott, Intuitive Surgical, Guidant, Medtronic, Data Skill Bard, St. Jude, Boston Scientific, and Johnson & Johnson, all outstanding companies that allow us as a management team to build this company here and knowing what great looks like.
As far as my own background, I spent the better part of my career in healthcare, and for the last nearly 20 years prior to Hansen, I was with–I had executive leadership positions at Teleflex, Covidien, and GE Healthcare, all of which have prepared me for this type of a process where I understand capital equipment, capital equipment commercial activities, and the process, and rigor that are needed to build this company to where it needs to be.
We spent the last eight months that I’ve been here taking a hard look at every part of the company from personnel, to inventory, to our cost structure, to our cost allocation, to our spend, and appraising models, and R&D, and clinical functions really across the board, and I think we’re in a much, much better place than we were a year ago.
WSA: And the stock have been doing pretty well as of late so as you continue to speak with investors in the financial community, do you believe that the story is becoming better understood and also, what are some of the things you still wish investors better understood about the company?
Cary Vance: Well, many investors have been following the company either closely or loosely over the years. And more than anything, I would want them to know that it’s a new day here at Hansen both from a spend discipline perspective, as well as a very clear, and direct strategic focus, and tactical focus on execution quarter after quarter, and great alignment between our technology, between our procedure focus and our clinical studies which will allow us to ramp here fairly quickly.
I mean, we’re essentially a tale of two product lines where we have an electrophysiology business that’s been around for years that is very well established, and that we expect to continue to grow. And we have a fairly new business in our endovascular side of the company with our Magellan System that really has only been around for two or three years which really only had one catheter until this past year, and which in a matter of a couple of months, we’ll have three catheters doing a couple dozen different types of procedures and really ramping up not only in the US but globally.
And I think, as I mentioned before, there is a disruptive year coming, and whether that’s sometime in 2016 or into ’17 even, we believe that we will have exponential growth at this company in the next few years.
WSA: Great. And so, once again, joining us today is Cary Vance, President and CEO of Hansen Medical Incorporated. Company trades on NASDAQ, ticker symbol HNSN, currently trading at 91 cents a share, and market cap is over 100 million. And before we conclude here, Cary, to recap some of your key points, why do you believe investors should consider the company a good investment opportunity today?
Cary Vance: Yeah, I mean, again, I think there is a time and a place for everything and every decision. And frankly, the reason why I came to Hansen is the best reason I can give to investors to jump in to Hansen right now is an investment. I invested my career and invested–I bought stocks myself not too recently with some college tuition savings that I had for one of my kids, and you know, I got to tell you that this company is poised to take off. We’re doing a lot of things to make that happen, and I believe now is the time–we’re at a tipping point in this business where we’re going to make a difference.
WSA: Well, we certainly look forward to continuing to track the company’s growth and report on your upcoming progress. And we’d like to thank you for taking the time to join us today, Cary, and update our investor audience on Hansen Medical. It’s great to have you on.
Cary Vance: Great to be with you, Juan. Thank you.