Although the company had no long-term debt as of December 31, 2023, $6.1 million in convertible note financing has been secured with $1.5 million funded as of March 31, 2023. Lastly, the company filed a current report on Form 8-K today regarding the restatement of the company’s financial statements as of and for the three and nine-month period then at September 30th, 2023. It will be included in the company’s annual report on Form 10-K as of and for the year ended December 31, 2023. The restatement will result, among other things, in a $3.7 million increase in the company’s net loss and a $3.7 million increase to additional paid capital as of and for the three and nine month periods ended September 30th, 2023 and it’s unrelated to revenues or cash expenses.
The company’s cash position as of September 30th, 2023 did not change as a result of this misstatement. And with that, let me turn the call back over to Brian.
Brian Carrico: Thank you, Tim. Let me conclude with where I started. The consistent execution has led to the milestones we achieved in 2023 and set NeurAxis up to achieve accelerated growth in the second half of 2024 and into 2025. We remain focused on leveraging the strong data from our studies, which will lead us to wide insurance acceptance from the 16 million lives we have under cover today to an exponentially higher number by the end of 2024. Furthermore, we remain excited about our opportunity with RED, which we expect to become commercial in 2024 and has the potential to be our largest revenue driver in the 12 months. With that, operator, we’d be happy to take any questions.
Operator: [Operator Instructions] We have a couple of questions that were sent in by some investors. Firstly, how do you plan to allocate capital to drive revenue in ‘24 and into ‘25?
Brian Carrico: Good question. First, we want to ensure we don’t build a commercial machine in areas where we do not have policy coverage. So we’re currently placing reps in areas with positive PENFS policy coverage. Second, we’re spending some capital to educate families and drive market awareness where new insurance coverage has begun. Additionally, and equally as important, we’re putting time and money toward the RED technology via the FDA process and commercialization. Those three points are critical to the question.
Operator: Okay, great. Thank you. Can you speak about your path to profitability?
Brian Carrico: Yeah, profitability is extremely important to us and we believe we do have a clear path. As we mentioned on the call, we already have enough patients coming to NeurAxis each month, each quarter to be profitable And this is from only a fraction of the children’s hospitals nationally. Second, we have accounts with decent policy coverage at best who are on pace to do well over $500,000 this calendar year, which speaks to proof of concept. The system is working. The answer to the question is that written policy coverage to meet the demand is the key to profitability. We believe we’re on track for that.
Operator: Okay, thank you. A questioner asked, what is the biggest challenge at this point to gaining written policy coverage?
Brian Carrico: Speed. The answer is, how fast can we do this? The data is now published in place. So the key to gaining — the key is gaining the attention of payers who are being pulled in so many directions. The good news is that we used to be told we need more data, and we very rarely have ever heard that now. The process is now about getting meetings and expediting the policy coverage. For example, we gained one large Blue Cross Blue Shield plan last May, but it was not announced until November. It did not take effect until January 1st of this year. This means that we are often aware of policy covers that cannot be announced until a payer announces it.
Operator: Okay, thank you. We have a question. Do you expect any IPO related charges to affect financial results going forward in 2024?
Tim Henrichs: No, we do not. The IPO was completed in 2023, and any direct costs related to the IPO per GAAP were included in our additional paid-in capital. And so therefore, even within 2023, you don’t see them reflected because they were deferred and pushed into the equity section of the balance sheet. There are no draggling costs, if you will, that we would expect to be incurred in 2024. 2024 should be a pure operational year for us.