Our History

MELA Sciences was incorporated in 1989 as Electro-Optical Sciences, Inc. The Company’s initial projects involved research and development of advanced technologies for remote sensing and image analysis methods for targets of interest to the Department of Defense. Support for this work came from the Office of Naval Research, the Ballistic Missile Defense Organization and the Defense Advanced Research Projects Agency (DARPA). Then, during the mid-1990s, by the suggestion of Dr. Alfred Kopf, the Company collaborated with melanoma experts from New York University, Harvard Medical School, Massachusetts General Hospital, Washington Cancer Institute and others to apply its expertise in signal processing “machine vision” technology to medicine and develop new methods to differentiate early melanomas from histologically benign, yet atypical, pigmented skin lesions.

The Company also engaged in several other machine vision development efforts, including DIFOTI, a system for detecting dental cavities without x-rays, developed with support from the National Institute of Dental Research (NIH/NDR), as well as SkinSurf , a patented non-contact device designed to help researchers measure skin wrinkles.

Grants from the US Air Force Phillips Laboratory and the National Cancer Institute (NIH/NCI) supported the development of a multi-spectral lesion imaging (SLIM) instrument, the predecessor of MelaFind®, designed to help identify clinically atypical pigmented skin lesions to be considered for biopsy to rule out melanoma.

The Company began doing business as MELA Sciences in February 2010 and formally changed its name to MELA Sciences, Inc. in May 2010.

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So I think we're ready to begin. So I'd like to invite everyone here for our Analyst Briefing, Melanoma Monday. Melanoma Monday is a huge day for us and we've invited two dermatologists with us, Doctors Mark Nestor and Doctor Gary Goldenberg, and they're here to present about the disease and how they incorporate MelaFind in their practice and answer your questions.

Before we start, however, I'll just give a little bit of the most important material, especially recent items that I actually reviewed last week.

So the first thing is that I will be making forward-looking statements and therefore I refer you to our publicly available documents.

The most important thing to remember about MelaFind is how it is to be used. Typical patient, middle age Caucasian male, like myself, walks into a dermatologist's office. There's 60, if you will, brown spots on my body, 56 of them look like that. Dermatologists need no help with that. From the doorway, Doctors Nestor and Goldenberg know there's nothing wrong with those. God forbid one of them looks like that. Again, from the doorway, wild horses wouldn't and shouldn't stop them from taking that off the body. And then two or three or one or four or five look like that. And it's in that presentation of these, yes, they're asymmetric, they're a little border irregular, all the ABCDs, but maybe one of them to Doctor Goldenberg has risen to the level it should be taken off, a different one to Doctor Nestor, maybe they both agree on another. Whatever. The point is it's in those three, looking like that, where there's a question and we know from data that these very, very early stage melanomas, which when taken off, are curable. To a typical dermatologist to sense their ability to detect that is only about 70-80%, MelaFind is 98.3%. So MelaFind, we call it, basically it's another letter. It's the way dermatologists practice now. They do a whole body exam and what they're going to have next to them, in the form of MelaFind, is another letter in the alphabet soup of melanoma detection of asymmetry, border irregularity, color variation, diameter, evolving, all these things. We have the most rigorously validated letter of them all basically and I've asked the gentlemen to go over the letters about that. So MelaFind is an input into the dermatologist's thinking. It does not replace dermatologists.

The way it works is there's two components to MelaFind, the hardware and the software. The hardware allows dermatologists to now see below the surface 2.5mm deep. They couldn't do that with their naked eye. And the magnification of MelaFind, in 10 different wavelengths, okay, the different depths, is 20 microns. Twenty microns means 3 melanocytes. So MelaFind can see in clusters of 3 melanocytes and that's enough for MelaFind to be able to come up with an assessment of the way the lesion is arranged. Now we're trying to coin a phrase in this disease. We don't want to compete with the literature on pathology or a clinical, so we've come up with the term disorganization. So MelaFind gives the doctor, the M – the letter M of MelaFind – gives the doctors an assessment of the lesion's organization, level of disorganization, high or low and they incorporate that. So the hardware lets them see below and 20 microns, the size, and then the software, which has been trained, developed, and tested on 10,000 biopsied-pigmented skin lesions including 600 melanomas. It has very sophisticated algorithms for calibration, feature extraction, quality control, and most importantly the classification. Okay. So hardware and software input into dermatologists' decisions.

Okay. So most recently, where we ended the quarter, we had 138 signed user agreements, 126 installations. Those data are weeks old now. And we had over 140 dermatologists either with a contract that they're reviewing indicating they want a MelaFind or what we consider high probability, high interest. And the more we get out there the more we get incoming interest and the more dermatologists continue to talk to us and in time move forward the way we want to move forward with them.

The most important thing in the first 12 months on the market, the thing I'm the most proud of because it was absolutely critical, is that we now have a MelaFind in 21 of the 25 most populated U.S. metro areas such that MelaFind – there is a MelaFind practice within 75 miles of 63% of the U.S. population. That was critical for us to achieve because now we can do the kind of patient mobilization, public awareness effort to really impact this disease. We don't want to frustrate the patients and be talking about this in a public relations point of view, an advertising point of view if they can't get a MelaFind. So now we're throughout the country and we can really do that. And dermatologists tell us that's what really helps when patients are already aware of something that could help them when patients come in and perhaps even ask about it.

We are beginning to see with the medical increased drumbeat and medical utility and stories of melanomas that are being detected as dermatologists tell us because of MelaFind and other great examples of its clinical utility. We're organically starting to see a number of practices increase their usage and that's what year two, which we just started, is all about now that we have a national footprint, now get the systems really used. That'll do a few things that will help change the disease. The more people use it the more opportunity for good clinical outcome and that's what our business basically is predicated on and that's what practice success is predicated on as well.

The other thing I'm very proud of is we've been very responsive to the customer needs and feedback. We know when you launch a breakthrough product the market research can take you just so far. The reasons, one of the main reasons we went deliberately, cautiously, methodically was so that we could incorporate the feedback from doctors like Goldenberg and Nestor who did incorporate, who did tell us things that we did incorporate in a couple of the user interface upgrades that we've come up with. We're now on a major PR and advertising campaign, which I'll get into in a second. And we are – another big part of this year in turning our business into a successful business is lowering the manufacturing and placement cost for MelaFind. And we have a next generation prototype in development and we're on track in lowering the price – excuse me, the cost significantly.

So the other thing we did as part of requests from customers is we're now offering three different models of use of MelaFind. The per session use where you can have up to five analysis uses, another five camera uses of MelaFind, the 10 depth, the 10 wavelengths or 10 clinical camera uses for $50. Now we – that's still there. Now we've offered a per lesion model. A lot of dermatologists told us this would be very, very helpful, so we now offering a per lesion model at $12.50 per lesion. And also some of the dermatologists that practice in large health plans have asked us for a flat monthly fee, so we're offering that as well. We don't have any customers on the third model yet.

So who are these doctors? All right. So doctor per session has a group of patients that are very comfortable in paying for value-added goods and services. They're happy with the price and the doctors like the simplicity of one price. Doctor per lesion has patients that have been – where they're looking to get more value for the price, and the value to price ratio for the per lesion model is significant and it really now opens the door for many patients principally, as the doctors tell us, because now we're talking in the range of a typical copay. That discussion is much different than the discussion the doctor per session has. And doctor monthly practices in a situation where they can't bill – she cannot bill for discrete services typically in a large health plan. So we now have three different models that will – as we now push with the PR campaign, advertising campaign, we now have three ways to make MelaFind more accessible.

So we ended the first quarter, it was our best quarter ever, with 144,000 in recognized revenue, another 392,000 in cumulative deferred revenue. As a reminder, the way this compared to the fourth quarter of 122 and 303. Now the way it works is when we place a system not all of the upfront fee of the $10,000 goes to recognized revenues, only 2,000 goes. The other 8,000 goes into cumulative deferred and over the next 24 months at $333 a month the cumulative deferred revenues get put into recognized. The most important element of recognized revenue, of course, is usage and usage is not something we focused on in the first year. It's something we are now focusing on in this year. And you can see that in the first quarter as compared to fourth quarter of last year of usage, the percent of recognized revenue that was attributed to usage grew from 24% – 25% to 36%, okay, and we look for that to keep increasing steadily.

So as we really focus on usage this year, where are we at across the whole system? Across every MelaFind that we have data on we have to examine the usage statistics. On average MelaFind is being used seven times per month. There's 20 possible days per month, so seven day per month on average, at two per active day. In our higher end, higher volume users, about 15% of the doctors using MelaFind, it's about – excuse me, it's averaging three per day, 13 days per month. So what we look to happen, as we now focus on usage, we look to see step function increases in this because the whole group up to a certain level gets a high volume users up to another level. And the way – the best way to explain how important usage is to our business is tremendous leverage. So to be break-even over two years at the current cost of MelaFind, we're significantly reducing that, at just three patients per day, 20 days a month, or six lesions on the lesion model or two patients on the session model, that's break-even. Break-even in one year would be six patients per day on the per lesion model assuming two lesions per patient and three patients per day on the per session model. And break-even within eight months of placement, for instance, you could see if you got that up to nine patients per day, again two lesions, or just four patients on the per session model. All right. And we have actually a few practices that are using MelaFind at levels similar to this and so we're very hopeful and confident as we now rollout these efforts to really get patients going.

So we timed this so that we did it in concert with Melanomas and Cancer Awareness. We're executing a vast 360-degree media campaign. We're really getting this message out to consumers. We have a number of spokes, if you will, in the strategy and you can see the number of patients that we are touching through the various tactics. We're about to start a WebMD campaign as well. WebMD is basically the source on the Internet where patients go for information about decisions that affect their wellness.

So we're very, very excited about what we've been doing, and I'll show you a little bit of this. But things come out now over the next few weeks you're going to see at least probably weekly more things. So we've already been in these consumer magazines, in placements and editorials, on the side column of an article about skin cancer and things like that.

We've been already on these national and regional TV shows and more happening. In fact just this morning we were again on Fox – excuse me, we were on Fox & Friends this morning _____ weekday.

We have greatly expanded our web presence. In the last year a typical month, I think we have maybe a couple hundred visits to our website, in the last month we had 4800 visits to our website. So the word is getting out. We're increasing the drumbeat to crescendo and now we're aiming to really make that more impactful, especially with the WebMD campaign coming up.

We're not forgetting the doctors. Can't do that. So in addition to the peer review papers that we continue to put out as we generate more and more compelling data, we also have articles in the everyday journals, newsletters, and things that dermatologists look at.

Okay. So we had a – not to get in the way of Melanoma Monday, which is really the American Academy of Dermatology's event, our colors are blue, but we're wearing orange here. We held our own event. We offered our customers to sign up for a program where we would offer MelaFind use for free and we had 60 – over 60 apparently – over 60 of our practices sign up to do this. Every practice at least had 20 patients on that day. We've heard of practices, 50-60 patients. The thing that I'm – and, of course, the media that's already come out in some key markets. There will be more media rolling out over the next few weeks all filmed in and around this. One of the greatest stories we had was of a patient was in for a cosmetic procedure and the doctor on the West Coast, very well-known doctor, dermatologist, spotted something in the middle of the cosmetic procedure and decided to use MelaFind on it. Used MelaFind and it turned out to be a melanoma. And it was very interesting to hear that the patient was – I'm sure the patient was happy that it meant it was a cure. But apparently the patient was equally happy that the cure was a small scar because it's very important to patients, not only the medical outcome, but the cosmetic outcome, and it's another compelling reason for early detection. So we will have taken surveys from all the patients. We will publish the results, if you will, of these surveys. But the most important thing to me about that event is that the practices were inundated. So they're going to see firsthand, up close how best to incorporate MelaFind for high volume use and they'll see firsthand the level of patient satisfaction at that volume. So we're very excited about that.

Okay. So we're now ready for what you all came here for, which is to hear two very, very well-known – I'm honored that they took time out of their schedule to come here – doctors, dermatologists who are using MelaFind to come up and talk about their perspective on the disease and how MelaFind fits in. First, Doctor Mark Nestor.

Dr. Nestor:

Thank you. Good morning. Just been an exciting day. Real excited to be here. Let's see, can we get my slides? How does this work? Okay. There we go. Okay.

So I'm going to talk a little bit about some of the aspects that Joe talked about here in a little bit different vein, in our clinical model, in our practice, but more talk about this in a whole in terms of the changing healthcare environment because I think MELA is at a very, very key time in terms of this whole evolution of healthcare and maybe really incredibly placed to be able to help the aspect of better care at lower cost, and I'll talk about that.

So I'm really talking about Clinical Excellence and Practice Enhancement because as a dermatologist I actually run a 51-member dermatology practice in Florida. We're actually looking at all aspects. We want, by far, the best care for our patients, but we also look at this as a business. So we have to actually look at both of these things and I'll talk about both of these things at once.

Quickly, my background. I'm from New York. I earned my bachelor degree upstate New York and I have a Ph.D. and an M.D. from UCLA School of Medicine. Did my internship out there and came back here for residency at NYU.

I direct the Center for Cosmetic Enhancement and Clinical and Cosmetic Research in Aventura and I teach part time at the University of Miami, Miller School of Medicine. I also, as I said, run – I'm the co-chairman of this large practice. I'll talk about that in a minute. And I've done a lot, both with the Florida Society and the past president of American Academy of Dermatology. I publish and I talk a lot at different CME events. I run a conference for about 500 or 600 dermatologists once a year for the last 12 years, the South Beach Symposium that just occurred.

I do a lot for skin cancer diagnosis and treatment; epidemiology, laser surgery, photodynamic therapy, as well as a lot of cosmetic in my practice. I do a lot of FDA trials and I work a lot with different companies around the world developing products and devices for them.

My practice. I've been practicing for 22 years in Aventura, Florida. With me I have physician extenders: two PAs, two MAs, and two Fellows. About 40% is clinical and surgical dermatology, skin cancer diagnosis and treatment. I'm in Florida, the skin cancer capitol of the world. We do a lot of – also we've been looking at radiation therapy in our practice, cosmetic dermatology, about 30%, I have about 42 lasers in my practice, toxins and fillers. And then we do a lot of clinical research, both clinical and aesthetic.

As I was talking about my practice, so we have 51 dermatologists and Fellows, 32 offices, 45 physician assistants, and a nurse practitioner, and we have a management team that runs this.

These are just some of the dermatologists in our practice in Florida.

So now let's talk a little bit about the meat of what's going on. You're all aware of the changing clinical and economic landscape of medical practices, and the key pusher of this is the Affordable Care Act; as always talked about, Obamacare. And it's the turning point a lot for both patients and physicians and how they're insured and pay for medical care. And I think this is very important because it goes to some of the things that Joe talked about and some of the vision for what's happening in the future. More patients will be insured, but patients will also have more responsibility. The model for Obamacare actually is 60/40: 60% for the insurance and 40% for the patients. There's also new payment methods for physicians. The model, theoretically, is that nothing will be done anymore on fee-for-service basis. It'll all be _____ for patients. So if you think back a little bit of what Joe was talking about, about this model of maybe monthly, the idea is to be able to do the best care, diagnose things, because not only is it better for the patient, but it's more cost effective to diagnose melanoma early. So in all the plans everybody wants melanoma to be detected early. The question is how do you do this while limiting what you don't need to spend money on, which is unneeded biopsies. Well, in this kind of model, just as Joe said, MELA is an ideal tool because it will allow us to not only catch things earlier, but also, as I'll talk about in the model, not have to biopsy things that don't need to be biopsied. And if you think about it, this is an ideal placement for the future of healthcare and I think that's very, very important. And I think that we're all looking to look at optimizing the best healthcare in a cost effective way.

Now skin cancer, as you're hearing from Melanoma Monday, is epidemic in the U.S. We just published a paper, about a year ago, looking at non-melanoma skin cancer showing in South Florida it's the highest in the world. And you're seeing melanoma – there was an article that was just published, yesterday actually, looking at melanoma rates in young teenagers and it actually showed a tremendously increased rate from 12 years old to 17. I'm sitting here with my daughter in front of me knowing that she does not go in the sun and she does not get tanned, but because of tanning booths and things like that, there is a dramatic increase in melanoma in teenagers, and this is very scary. And actually young women are becoming more common than young men for this. And this is very, very new data. And if you think about it, when you're thinking about kids that don't like anything done to them, the idea of having a tool to be able to evaluate these lesions in kids is just amazing. So that's something very, very important. And the problem for the future of healthcare is how to best deal with skin cancer epidemic in a way that's most clinically beneficial and cost effective. Well, the solution, as I said, is to detect early and minimize unwanted procedures.

And we're meeting these challenges for this, as well as skin cancer epidemic by doing things as follows. You heard it this morning, we're pushing for earlier detection. This is key and this is key for what Joseph said. Melanoma Monday, skin cancer screenings, and technology. We've had dermoscopy for a while. It's technically difficult to do. There's a lot of learning curve. It does help. And now MelaFind. We also have to deal with the issue of patient responsibility. Patients come in. They have higher deductibles. They're saying, you know what, I really don't want things done. And we're saying well for those that have to be done you really need to because it can save your life. And the idea is to minimize unnecessary procedures and that's where MELA comes in. And finally, for physicians, if we're going to get cut in terms of what we're doing in our practice, we need additional revenue and here MELA steps in also.

So dermatologists are the experts in detecting skin cancer and treating melanoma and detecting it. And there really are two different types of dermatology practices. And this is, of course, a gray zone. It's not X and Y, but there's really two general types. I'll say the first one is conservative. Biopsies, those lesions that are only most likely to appear atypical. And there are dermatologists out there that just say this is very atypical, the other ones I can watch. And they can miss melanomas that may appear clinically mildly atypical. And I think MelaFind can help in this case by identifying these clinically marginal lesions, just like Joe was showing you, that are histologically melanoma because it gives you that extra tool. The second type is what I'll call aggressive. Aggressive dermatologists biopsy all clinically atypical lesions, including those that may be mildly atypical because they don't want to miss anything. And they biopsy more benign lesions. And I think it's because this, MelaFind, can help identify benign lesions that may not be needed to be biopsied. And again, it goes to the point of trying to do things that help (?) care (?) evolve to be cost effective.

Now I'm an aggressive dermatologist and I tend to biopsy things that are suspicious and I have a low threshold. I look at it as the beauty is we can see everything. It's not like something in the body. It's not that invasive to do a biopsy for the most part, so that's the way I've looked at it. So in general, marginal lesions I'll usually biopsy so I don't miss anything. But MelaFind gives me a unique tool. It gives me a tool to be comfortable not to biopsy a marginal lesion if the disorganization is read by MELA is low. And I can watch these lesions over time because what we did in addition to Joe's data, when we started doing this we looked at hundreds of lesions that we were going to biopsy one way or another for MELA and what we found is that we were really convinced that if the disorganization is low we really aren't going to miss melanomas, and really that was the key. So once we had a lot of data from that and we felt comfortable, we were able to really utilize this in our practice. I charge, as Joe talked about the model, about $150 for up to five lesions, and it usually spares about one to three biopsies in those patients that do it. I can see up to 10 patients with MELA on a clinical day and it provides us with $1,000 extra revenue net in my practice on a day and that's always good for the bottom line in a practice, especially when it does a service to our patients.

So I'll talk a little bit about some clinical vignettes because I think what this can do is give you an idea of the type of patient that this is applicable for. So a 46-year-old male with many moles that comes to me with a changing mole, has a long history of sun exposure, and says some of these moles are changing. On exam I see actinic damage – I see it almost in all my patients in South Florida – greater than 50 moles, two that look very significantly atypical, I biopsy no matter what, and five borderline. So the plan was two biopsy, five MELA. So what MELA showed me here is high, high, high, high, high in all of them for this case, from about 1.3 to about 2.8 and I biopsied all these lesions because they were all high and they all showed various levels of dysplastic nevi. No melanomas for these, dysplastic nevi. The patient paid a copay of $150 for MELA and they were very grateful that they felt comfortable that these needed to be biopsied.

The second is a male, a 33-year-old male, with a history of dysplastic nevi with new lesions that are changing and becoming more irregular. They had about 10-plus lesions, one significant, and five borderline. Biopsied one significant, we did five borderline in MELA, and what this showed was that three of them showed low disorganization, two high. I biopsied the two high, I left the other ones alone to watch them. The pathology in this was again different types of dysplastic nevi. And dysplastic nevi are looked at in general as the spectrum before melanoma. So they're not necessarily absolutely normal. They're not melanoma. It's part of this atypical spectrum. The patient paid deducible, $150 for MELA, but because this patient had a high deductible, the patient saved about $500 and they were thrilled because they wanted me to biopsy everything that I needed to biopsy and because of this we were comfortable together. They came away with pictures of the lesions. That's one of the things that MELA does. MELA gives a printout with pictures that patients could look at. They feel comfortable that they could watch it, as do I, and they feel comfortable because they saved $150.

Finally, I had a 69-year-old female with a history of melanoma with new lesions that are changing and becoming all irregular. This 69-year-old female cares about her appearance. She wears low-cut gowns. She does not want more scars. When I examined this patient she had some scars, melanocytic nevi, one significant atypical and four borderline. So I did the MELA on the four borderline. What we found was one high and the rest low. So I biopsied the one and I watched the other three. The patient was thrilled. The one showed a highly dysplastic nevi. We took that off. Patient paid $150 and was so grateful because she had less scars, and yet she felt comfortable that she did not have another melanoma.

Finally – I should say one more – a 25-year-old female with many moles, some have changed. She had removed a number in the past and she has thickened keloid or hypertrophic scars. She had no insurance. She had greater than 20 lesions; one significant, four borderline, and a lot of hypertropic scars. I did MELA on this patient and what I found was one high, the rest low. The patient had two biopsies. Remember the one that I was really very convinced of. She paid 150 for MELA. She saved a lot of money because she didn't have insurance. She was extremely happy because of lower cost and less scarring.

So these are kind of examples of my real patients, but different smatterings of examples to give you ideas where MELA works.

So in conclusion, what I want to talk about here is that economics and medicine are changing, they're evolving, and we're looking very, very importantly at optimizing care in a cost effective way. Skin cancer, including melanoma, must be detected early and it is epidemic so it is very, very important. And the reasons for detecting early are twofold. Number one, to save a patient. That is the most important thing to me. The early detection saves the patient. But number two; it is incredibly cost effective to catch things early. It is much, much more expensive to catch things late for healthcare, for healthcare costs. Patients are paying more for healthcare and they want to limit procedures, not just because of the fact that they don't want to get cut on, because they want to save money. And dermatologists, whether they are the aggressive type or conservative type, can benefit using MELA to either help detect melanomas or prevent unnecessary biopsies. And I think the key thing that I've seen and I will see is that two things are going to happen. Number one, patients are going to become more aware very quickly of MELA's existence. But number two, if you really understand the dynamics and changing healthcare as times goes on, this device is absolutely ideal to do two things; to improve healthcare, but more than that, to save the system a tremendous amount of money. When you have these _____ healthcare organizations where there's a fixed amount of money here, they want to be able to, in a very, very positive way for the patient, limit cost. That's where it would be incredibly beneficial for everyone of these to take MELAs and put it in all their practices because overall it will decrease the cost of healthcare yet improve the outcome for the patients. And I think that's really what the system is shooting for, and certainly for our patients what dermatologists are looking for.

So I thank you for attention. I'll turn it over to Gary.


Good morning, everybody. I want to thank Joe for inviting me here today. I really appreciate everyone coming and everyone that's tuning in. And I was listening to Mark's remarks and I was thinking to myself how similar we think about things of this nature, but how different our practices are, and I'll talk a little bit about that.

So this is my bio. I did all of my training in Philadelphia, which is my hometown, and except for residency and fellowship, I'm double-boarded in dermatology and dermatopathology, so when I look at a patient with dysplastic nevi, with skin cancer, I not only think as a dermatologist, I also think as a pathologist because part of my job is looking at the biopsies that Mark and other dermatologists take to actually diagnose the skin cancers and dysplastic nevi. So I think of patients as sort of – lesions not only from a clinical point of view, but also from a histologic point of view.

I have over 100 publications, 50 national and international lectures, and one of the things that I think is applicable to this forum is that I'm part of this global consensus on skin cancer, which is a global group of dermatologists trying to come up with sort of an algorithm of taking care of patients that have melanoma and nonmelanoma skin cancer.

Okay, so a little bit about my practice. I practice full time at Mount Sinai School of Medicine. I'm sorry, now it's called the Icahn School of Medicine at Mount Sinai. And if you can't find my picture there, I'm the young, good-looking one in the – just kidding.

This is also my practice. This is my website. I was interested in hearing about the MELA Sciences website. My website gets about 600 to 700 visits a month and a lot of it is for skin cancer.

So why are we here talking about MELA? Well, the thing about dermatology is about 90% of the time we practice what's called doorway dermatology where the patient is sitting there, if you can see whatever it is that their issue is, about 90% of the time you can make the diagnosis from the doorway. It's just basically like seeing a red Corvette. A lot of times when you see, you know it.

So when you see a normal nevi or moles and they look like this and you say these are not really worrisome. It takes less than a second to look at something like this and say this is totally fine. You can keep it. Forget about it.

And then there are lesions that are melanomas from the doorway. And you see these and you say well, this is definitely not going to be good. We're going to have to really focus on this lesion, take if off, make sure we get a histologic diagnosis. So this is a minority of our patients.

This is – sorry – this is the ABCDE criteria that we talked about earlier.

But this is what most of our patients look like, and if Florida is the skin cancer capitol of the world, I think Manhattan is the dysplastic nevi capitol of the world because we have a young population and patients who get dysplastic nevi are not the farmer-types that get non-melanoma skin cancers. They're the ones who take four vacations a year and they go somewhere warm and sunny and they get a couple of sunburns. In fact, we know that if you get one blistering sunburn before the age of 18, you have a higher chance of having a melanoma than if you don't have a blistering sunburn before the age of 18. So think about yourself and everyone that you know. I am sure that everyone you know has had a blistering sunburn before the age of 18 and this is why melanoma is such an epidemic. This is data from Australia where about one in 30 patients gets or – actually people, one in 30 Australian citizens gets a melanoma in their lifetime. So the number in the U.S., about one in 50, one in 60. It is going up. But Australian data – from Australian data we know that if you get one blistering sunburn before 18, you're going to have a melanoma or you have a higher chance of having a melanoma.

So this is a perfect patient for MELA because you look at these lesions and you say, okay, well where do I start? Some of them are surely benign. Perhaps one or two may be borderline lesions and God forbid one is a melanoma and that you miss or a patient like this. And the thing about MELA that I really like, and this is how I utilize it in my practice, if a patient comes in and they look like this patient right here – go back – and you say, okay, there's some lesions that I'm going to look at and they're going to come off. I don't care what deductible the patient has, whether they have insurance or not. I don't need MELA to tell me that I'm worried about it. And the way it works for most dermatologists – and I use dermoscopy, and I think Mark alluded to this, dermoscopy is a tool that you need to learn. It is a steep learning curve, but I think most of us that use it really understand what look atypical and what doesn't. And there's some lesions I'm just going to take off the initial visit. I'm worried about them. I thought of myself as being a conservative dermatologist because I take a lot of things off, but I guess I'm aggressive. So I guess it depends on your definition. I'm conservative because I don't want to miss anything, but I'm aggressive because I biopsy a lot of lesions. So there are going to be some, they're just going to come off on the initial exam. And then what I usually tell patients like this is this: You have a lot of moles and we know for a fact that dermatologists miss moles – miss melanomas everyday. The best dermatologist in the world misses melanomas everyday because sometimes they're not clinically diagnostic. It could be just a cluster of cells that mutated(?) histologically that would make it say, okay, this is an early evolving melanoma and finding things early is really the name of the game. You want to find them before they have a chance to spread. That's really the best-case scenario. So I'll tell the patient, listen, you have so many moles it's impossible for me to tell you which ones are okay and which ones aren't, other than the ones that I just took off or told you that they're totally benign. So remember that kind of in between the gray area.

So there's this new device, it's a new technology. It's an algorithm that's another tool in my tool belt to make us feel comfortable or uncomfortable with certain moles. So I want you to come back for another visit. What we're going to is MELA. We're going to scan up to five moles. I also do up to five moles per session. And then if they're high, we're going to take them off on the spot. If they're not, we're going to watch them and we'll do it again next year. So I'll talk a little bit about workflow, but I want you to kind of get the picture of why it is useful and it's useful because there's so many different things that are in between. The gray area is really a very large area.

So this again is my website and you can see I have MelaFind prominently on my website and actually get about – last month I had about 50 to 60 hits on the MelaFind page on my website.

This is a blog that I keep and I update on my website about MelaFind.

And this is what it looks like in my office. This is a patient exam room in my office at Mount Sinai at 5 East 98th Street and you can see how nicely the MelaFind fits in the corner of the room. This is the room that we use for MelaFind whenever a patient comes in for MelaFind evaluation.

So how do I use MelaFind in my practice? I think I already talked a little bit about the fact that I reserve it for the patients that have a lot of lesions that are sort of in between, which is a lot of patients that we have with dysplastic nevi. The patients that benefit the most from MelaFind are the ones that have more than three or four or five moles because if somebody comes in and all they have is five moles, and this is a typical scenario -- a patient comes in, says my wife, my spouse, my girlfriend, whatever, is worried about some spots on my back. Can you please check them? And there are three lesions. Say it's easy enough for me to take off three lesions. It'll take five minutes. We'll get a histologic diagnosis and then we'll figure out what's going on from there. But what happens if they have 50? Well, you don't want to be a butcher. You don't want to take off 50 moles in every single patient. So for those patients, that's when I approach them to talk about MelaFind. And there's a lot of patients. Most patients have more than eight nevi. And a lot of patients have them to be dysplastic. So how do I discuss this with a patient? Now I charge a little bit more than Mark does, maybe because my overhead is probably more in Manhattan than it is in Florida, but my fee is between $300 and $350 a patient. And basically what I tell them is very simple. You just have to budget it once a year. You're going to spend $300 to $350 in MelaFind so there's got to be something that you are not going to buy in your budget for the year that you can budget $300. Maybe smoke one pack of cigarettes a day instead of two. Maybe get your nails done every 10 days as opposed to every seven days. Of course I'm joking about smoking. Get a Macallan 18 as opposed to a 25. There are certain things that patients can do because it's their healthcare. And I joke about this, but this is serious conversation with a patient. So what I tell them is not only can it decrease the number of biopsies, decrease the number of scars, most importantly it can save your life. And I'll tell you about some patient case scenarios for moles that I wasn't that worried about to take off initially, ended up being melanomas, and I have lots of patients like that, which is why I'm a believer in MELA, which is why I'm here presenting to you.

So about my workflow. So I have a very busy practice. I schedule between 8 and 10 patients an hour, and for me the most important thing is to have the rooms always with a patient. So I can't have the patients going in and out of rooms because that takes time to turn it over; that my nurses clean the room between every patient, so that takes time. So what I do is this. Patient comes in, has lots of nevi, we take off some initially who have a history of melanoma, say you have to come back and schedule specifically for a MelaFind appointment. And my appointment secretaries know exactly how much time I need for a MelaFind patient. They schedule me for 20 minutes. What I do when the patient comes in is we get them undressed and then we do a full skin check, only looking at melanocytic lesions because when somebody comes in for a regular full skin check, we may look at a rash they have on their face or on their back. We may look at some red spots or some scaly spots that may be non-melanoma skin cancer. They may have psoriasis. They may have acne. At this visit we're only focusing on brown spots, only on moles. And I look at every single one of their moles and we pick five that are the most borderline. They're not the ones that I was really worried about, so we'd already taken those off, and not the obvious ones that are benign. They're the ones that are in the middle and we pick the five most atypical ones. And then I actually do the MelaFind myself with my assistant in the room. I'll just say to my assistant, 6mm pigmented patch on the right chest. She puts it in the computer. It takes about 5 to 10 seconds. She hits a button for the MelaFind diagnostic tool. I apply the probe. Five seconds later we get a diagnosis, high or low. If it's low we move onto the next spot. If it's high right at this moment I numb up the lesion, we take if off, we send it off to pathology. So in 20 minutes, 15 to 20 minutes I can do a full skin check, scan up to five moles with MelaFind, and take off all of the ones that are high and leave behind the ones that are low for the next visit. And what I tell these patients is basically every year we're going to do MelaFind once a year for all the lesions that are marginal. And we watch the lesions every year because the ones that are obviously changing we're going to take off. The ones that are sort of in between we're going to MelaFind.

So I think Mark alluded to this. There's some dermatologists that are watchers. I'm not a watcher. I like to know what something is at this minute. And a lot of people use photography. A lot of dermatologists use fully body imaging. The thing about full body imaging is sometimes you've been watching a melanoma for a while and feel it has the surface change that you can see that now is worrisome to you. And I know we have – the healthcare environment is changing, but we can't forget about the medical legal environment. So now you have this high resolution photography of something that's become a melanoma that somebody can blow up as an 8 by 10 poster and show to a jury and say you've been watching this melanoma for the past three years, doctor. Why didn't you cut it off three years ago? That's why I don't like to watch things. If I worry about something, I want to take it off. I want it in a jar. I want a histologic diagnosis. I want to know exactly what it is. The thing that I like about MelaFind, it's actually my favorite thing about MelaFind, is it gives me a diagnosis or it gives me something that helps me with a diagnosis on the spot. On the spot, five seconds later, I know if it's high or low. If it's low, I feel more comfortable watching it and seeing it again next year. If it's high, I know it's got to go. And most of these lesions come back as being dysplastic nevi, which is a whole grey area in dermatology.

So when I talk about price to the patient, I basically tell them, you're going to have to do this once a year. I don't give them an option. You have to do this because you have all these moles. And if I take your insurance plan, you're going to pay for the MelaFind out of pocket. You may have a copay. Everything else is going to be covered under your plan. If we don't participate in their plan, then they just get an itemized bill they send to their Blue Cross or whatever carrier and then they get reimbursed for whatever it is that their insurance would pay.

Some questions that – I talk about MelaFind to doctors all the time and not because I'm a paid consultant with MELA because I'm not, but basically because I believe in the technology and I really think it works. So can MelaFind replace dermatologists? I think that's the biggest fear that dermatologists have. The biggest fear dermatologists have is non-dermatologist, family doctors, internal medicine doctors buying this device and all of a sudden having a mole clinic. And we all know that with Botox and fillers and lasers, you could be a dentist or an anesthesiologist or a radiologist injecting Botox and fillers. Well, the good thing about MelaFind is that dermatologists still cannot be replaced because it's very important to pick the right spots to scan, because if you scan the ones that are obviously melanoma or obviously benign, what difference has it made? If you go see a dermatologist, they're going to know what they are. So you have to have a trained dermatologist that specializes in pigmented lesions to know exactly which lesions to scan and that's why dermatologists cannot and will not be replaced by MelaFind.

MelaFind is difficult to use: I'm a technophobe. I'm too old to learn something new. I love this one. I'm too old. I've been doing this for 30 years. I'm only going to practice another 10 or 15. I really don't want to learn anything new. There's a joke about this. The dermatologists don't retire, they die. There's really some truth to that because you can really practice until the older age. Anyway, it's not true because MelaFind is very easy to use. In fact, the part that doctors do is the easy part, which is technological, which is finding the mole. Medically it's difficult. But most of the technology is going to be done by your MA or your nurse or your technician, but mostly, young folks that are technology – they love technology. They're early adopters, so I think that's not true.

Does MelaFind miss melanomas? Well, it's very important to talk about false/positive and false/negative rates. Yes, MelaFind misses less than 2% of melanomas, but that's several-fold less than what dermatologists miss everyday. So everyday when I come home from work I know in my mind that there's a melanoma that I've missed, and every dermatologist does it. This happens everyday in practice. So MelaFind has a very low false negative rate. It does have a higher false positive rate, which is okay for cancer detection. So when you talk about cancer detection, you're going to pick up some things that are okay, they are not benign completely or they may not be cancerous or these dysplastic nevi category, but they're not going to be melanoma. And that's okay because we'd rather take more things off that are benign than leave one melanoma behind. And we talked about cost to the healthcare system, but what's really important is – and if you're a dermatologist and you've got patients that you've missed melanomas on die, I mean it really kind of hits home. And that's what it's all about; it's about saving a life and that's what this device really helps us to do. It helps us save the lives of our patients and helps us detect melanomas at the earliest stage of detection because if it's at the very early level, it's much easier to cure it really because if you think about melanoma, if you start talking about chemo, your chance of surviving is not very great, even with all these new chemotherapy drugs. Most of them extend your life by about a year. We're not talking about a cure. We're talking about extending your life by a year. But if you'd have found that lesion six months ago, a year ago, two years ago, it's possible that just with a surgical procedure that lesion gets cut out and your five-year survival rate is 98%, which is what it is for melanoma in situ. So that's why it's really important to detect these lesions early, to biopsy them early, to cut them out early, and that's really why we're here. We're here to save a patient's life.

I had another slide. I don't know why it didn't come up. It's a slide with my anecdotes or my patient cases. So I'll tell you a story. There's a patient I'm seeing today at 4:30 for an excision. He was in the – in your industry. He was a – he worked in finance and he's retired. He's had a good career. He's got a boat, some beach houses and he's had way too much sun. He's had a couple of melanomas and I've been seeing him for about a year and a half. We've taken off a lot of what's called high-grade dysplastic nevi which are basically – they're not melanoma, but they're not normal and they're closer to being melanomas than being benign and those usually need to be cut out because we've worried that they may become melanoma down the road. He's had a bunch of those. He's had a few melanomas and I saw him for MelaFind just three weeks ago and we scanned a mole on his body, it was on his shoulder that we've been kind of keeping an eye on it. I didn't think it was atypical enough to biopsy, but it wasn't exactly normal and it was perfect in that gray area where MelaFind is really helpful. And it turned out – and he swore to me that it's been there forever. He's had it since he was a kid. He's had it multiple years. He remembers it, this and that, which is a typical story from a patient. So what it turned out to be is a melanoma in situ, developing a congenital nevus, which is a nevus that you developed close to birth or at birth. So here's the mole that's been there for a long time and it's changed. Because he had some sun and it's change the biology of this thing that was going to develop into an invasive melanoma and perhaps have some problems for the patient later. And it wasn't atypical enough for me just to biopsy, but because of MELA I was able to diagnose it as high. We took it off on the spot, sent a biopsy to the lab, two days later had a diagnosis, just really dysplastic nevi with evolving melanoma in situ. So he's coming in today to have a definitive excision and his cure rate, because we found it early, is between 98% and 100% essentially. Once it's out it's going to be out. And I have lots of stories like this, and I'm sure Doctor Nestor does, where things that we weren't worried about or weren't worried enough to just biopsy from the get go end up being things that we should have taken off or if we had a pair of eyes that looked 2.5mm into the skin maybe we could have or had an algorithm built into our brain. And that's where MelaFind is really important. I think it's just another tool that dermatologists can use to diagnose melanoma at its earliest stage, at its infancy, and sort of cut it out before it has a chance to do – to have any trouble.

This is my thank you slide. And I think we have some time for questions, so I'll turn it over to Joe again. Thank you.


Thank you. Just before questions, so Mark, MelaFind has a label for all ages. So on the pivotal trial there are 100-some odd pigmented lesions that were biopsied, seven melanomas in under 18-year-olds, so MelaFind detected pediatric melanomas. That came up at the panel meeting. And another answer for the docs – I'm sorry, is that it's labeled only for dermatologists, so it shouldn't be a worry about that.


And I just want to mention, just give you a brief clinical scenario. Just about a month ago, I saw a patient. I don't see kids. My practice is adults and geriatrics. And it was a patient of another dermatologist who happened not to be in the office. Came in and the Mom was convinced that the mole on this kid's back was atypical, but the kid was a teenager. Said there's no way I'm having this biopsied. I don't want needles. I'm really scared. I don't want it done. Came in for MelaFind and it turned out to have – to be MelaFind high and this kid would have never let his parents have this biopsied. So we had another level of evidence. I actually sent him to a plastic surgeon because he wanted to be put out basically. They made him unconscious. And they cut it out and it was severely dysplastic nevus. So this is a kid who is a teenager, had multiple sunburns. _____ to men – men go without our shirts on and things like that, especially when we're young. But had a sunburn. Could have developed to melanoma. I think that's where it's important that it even works on the younger patients.


All right. So questions for our docs?


Where you have colleagues that don't seem to be particularly excited about MelaFind, is that because they get – they're just so conditioned to do biopsies just right away and aren't receptive to sort of new technology? I guess I'm trying to understand. You've been out in the marketplace a year and a half, plus or minus, and you've only placed 140 roughly of these systems. I would think every single dermatologist in the country would want one of these, almost as a no-brainer.


I think the key issue, and Gary and I could talk about this, there are two or three types of physicians, actually people. There are the leaders that kind of do things first and they always look at new technology. It doesn't have to be in dermatology. It could be I want the smartphone first, etc. And then there are people who sit back and say I'm going to wait to make sure that this work. There is that next wave. And a great example is what happens with – and I was talking about – a little bit about Apple today. What happens with the issue of technology because what happens is you get these early adopters that look at that and then all of a sudden there's this passive (?) wave that comes up and people say, aha, wow. It actually is something that's incredibly valuable and works. And then all of a sudden it takes off. I think what's happening is that, that to the company's benefit, they did this the right way. They did not want to just have everybody willy-nilly use this out of the gate right away without having more and more and more clinical feedback to make sure they have it right, not necessarily from the technology, but in terms of how it's being used. And I think that's what's happened. And I think what happens is now the clinical – it's being presented, number one, at meetings, and this is part of the issue. Where do doctors learn about this? They learn about this, for the most part, not necessarily from reps, but from other physicians who are using it. So they go to CME meetings. They learn about it. They learn also about it from their patients. And I think this next wave, which it's not overnight as much as companies want that. It may take a year. It may take two years to really crescent. But what's happening is, and as I explained, along with that this wave in healthcare change is kind of meeting together. So I think what you're going to see is a tremendous change over the next period of time where you're going to get more and more adapting of this for the big wave of dermatologists beyond that.


I want to add to that as well. I agree with everything you said. I think there's several reasons and I think one of the reasons is some people just – they just don't want to change and it takes a while for them to realize that there are competing dermatologists across the street is doing it so they're going to have to do it as well. And I think that that's definitely a part of it. I think also dermatologists – and I would never say the dermatologists practice with financials in mind more than patient care, I think a lot of dermatologists are so used to the fact that we get paid for doing biopsies, say well if I get this MelaFind maybe it will decrease the number of biopsies that I'll do. What they don't realize is that the system is set up right now to decrease the number of biopsies we do anyway. So Doctor Nestor alluded to this. This is another revenue source because we're going to get paid less and less for doing biopsies. You're going to have to do less biopsies because at some point it's not going to be worth it to you financially to do so many. So I think that's going to help MelaFind as well because there's something called the multiple surgical reduction rule where for every single – for more than one biopsy, any biopsy, do more than one, gets cut by 50% by health insurance plans. So if you get, let's say, $100 for the first one, you get 50 for two, 25 for three, 12.50 for four, and at five you're basically – you're losing money actually at five. So once that becomes more and more into the system, I think they're going to realize that there's got to be another way that they can do it from a purely financial point of view. And I think that a lot of dermatologists just think that they do better than the machine and it takes a while for them to really understand this is just a tool in the tool belt. It's not going to replace them. It's going to help them to better take care of their patients. And I think that's the message that's got to get out to the dermatology community; that this is just something that's going to help you take better care of your patients. You're already taking good care of your patient. This is going to make it a little bit better. It's another something that you can do to not miss melanomas. And I think if we can sort of get that message across to the docs, I think a lot more of them are going to start using the device.


Just a follow up on that question. What will drive a change in sentiment? What will get these dermatologists that aren't as excited about it as you obviously – both of you are obviously believers in the merits of the technology and what it does for patients and for your practice? We have pivotal trial data. We have numerous reader studies. Do we need more clinical data or is it just a matter of time in terms of continued exposure and continued key opinion leaders like yourselves trumpeting the message of the benefits of this system?


I think it's a number of things. I think that, as I said, the evolution of healthcare is pushing it in that direction no matter what. I think part of it is just going to be time and more – it takes, like anything else, there's a key time. When you've heard things two, three, four times, it takes that fourth time for that aha, to say okay, fine. Now is the time I act on it. So again, nothing changes overnight no matter what. They're early adapters that constantly look to make things better and change. But the majority of us, in anything, take a little while to adapt to things. And again, I think part of it is, what really goes, is patients. When patients start hearing more and more about this and come in and say, I want this, that's one of the key things that pushes a lot of doctors over the edge, from that perspective.


I think it's all the things that you mentioned and I think it just takes time for things to happen. I'll give you an example. I don't know if any of you cover biologics and psoriasis, but biologics and psoriasis are now sort of standard care for severe psoriasis patients. And if you look at the percentage of docs that use biologics, about 90% of the prescriptions are written by 30% of the doctors. So you're going to have some practices that are running MelaFind all day long. You talked about sort of increasing the number of sessions per day. They're just going to have a room kind of like with photodynamic therapy and I think we can draw some parallel to that where patients just come in and somebody just – it's all they do is MelaFind all day on the patients. Then you have a group of physicians, 30% of physicians, they're going to say, okay, I'm going to do maybe one or two patients a week or four patients a week or 10 patients a week. And then there's still going to be some doctors say I'm close to retirement. I really don't like it. It costs too much money. We have patients who can't afford it. There's always going to be a group of doctors who are going to say, well, I'm just not going to use it. But I think what's going to happen is the patients are going to demand it because they're going to say, okay, I've had 20 biopsies, perhaps I could save three the next visit or my friend was diagnosed with a melanoma in situ that a dermatologist didn't think was that atypical. How do I know that I don't have any lesions that are like that? Can you do MelaFind for me? And I think that's going to drive more and more physicians to get the device because we know if you refer a patient to another doctor for a procedure, they might just stay with that doctor forever. And in some areas, like if you're in the middle of Texas or Oklahoma, there may not be dermatologists – another dermatologist for 100 miles. You may not care. But if you're like I am, in Manhattan, there are 800 dermatologists around this area, it is a little bit of competition, and everyone wants to get the patients with the best insurance plans or the ones that are out-of-network. And I'm – just from a purely business point of view, you want to retain those patients. You don't want to send them to somebody else. I wouldn't want to send a patient to Doctor Nestor because the patient may say, well, Doctor Nestor is so much nicer than you and he doesn't keep me waiting as long. Better looking. Taller. I'm going to do my Botox, fillers, lasers, and everything else with Doctor Nestor now, and I think that there's going to some of that, as well.


Just one more question. Can you just comment on the buzz that you're hearing amongst your colleagues in the dermatology community about MelaFind and where that's developed from early innings last year? And maybe, Doctor Nestor, you can just talk about the buzz of MelaFind in your recent Southeast Symposium. Thanks a lot.


Yes, certainly. The buzz is really important. I mean we had – at the Southeast Symposium we had a number of different talks on MELA. There was a tremendous amount of interest. Again, part of the issue is people learning. This is a learning curve like anything else. It's something new. And the nice thing about – I should say, the one good thing about MELA, believe it or not, in dermatology practice is it's not expensive. It's not a big investment. When you're talking about spending a couple hundred thousand dollars for a radiation device or 150 or now there's one that just came out at 300 for a laser, this is nothing. And the nice thing is it can help our clinical practice. So I think from an investment standpoint for dermatologists, what they're used to doing, this is not a big investment at all. And I think that it's something that as the information and learning becomes more prevalent – as Gary said, the understanding that this is only going to improve healthcare and the bottom line at the same time, that all those concerns and the fact that you're learning about it just go towards the evolution of people bringing it into their practice.


I think the nice thing about the MelaFind devices – I see it at meetings – and it's the fact that when its – people can come and touch it. It's not something that's abstract. It's not something that you buy and you kind of put somewhere in your office. They actually have it at the meetings and you always see the dermatologists come and sort of congregate and actually run the device at meetings a lot where if you want to have some of your moles that you weren't worried about, scans, it's just – it's going to take time for them to feel it, to look at it, to learn about it. And then I think – we can talk about bottom line as much as we want. Most doctors – I really believe that 99.99% of doctors are in this business to take care of patients and I think the more we learn about the fact that this can save a life, it can help you detect melanoma early, the more that's out there I think the more and more people are going to realize it and more doctors are going to use it and more patients are going to want us to do it.


I want to comment that I do think it's a little bit different than Gary because one of the nice things about MelaFind is it's very portable. So what I do is when I see a patient and talk to them and want to do MelaFind, I will circle the ones that I want and leave the room. And my MA will go get the device, bring it in the room, do it on that. I will come in when it's all ready. I'll go through the readings with the patient. It'll just take three or four minutes. And then what I have done and circled, my PAs do the biopsies. So we have a very, very efficient practice. It's different than – academics is built not to necessarily be that efficient because it's impossible, though Mount Sinai is one of the most efficient places in the world I must say for academic institutions. But in clinical practice, we try to do everything very efficiently. And the nice thing about MELA is you don't need a doctor to do it. You don't need a PA to do. An MA can utilize the device very easily. I can sit there and discuss with the patients, my PAs can do the biopsies, and we become a very efficient way of being able to get the best care and be cost effective.


All right. I'm sorry, another question?


At the current run rates you're spending something like $9 or $10 million a year in R&D. Could you give us some more granularity as to exactly what that is?


We're conducting a post-approval study from the FDA. We continue to conduct other studies. We have a number of efforts underway in the cost reduction of the manufacturing, which will come under development, basically developing not only the new system, but also the manufacturing methods for that. So there is significant R&D activity. We have cut them back. We have maintained our spend even throughout our launch, to the year prior launch, which is very important to keep costs down and spend efficiently. But no, we significantly – we continue to do a significant mass of R&D, for instance, the upgrades we made to the system with the user interface. I'm pointing to the doctors because it was doctor initiated. That's R&D. The initiation of the three new business models; that's R&D because it has to be programmed into the user interface, it has to be verified and validated and withstand quality scrutiny, both FDA and ISO. So all of – anything you hear me talking about that's different than you heard last time is R&D, actually if it affects the product. So it's not core R&D, about maybe a fundamental change to the product, but even subtle changes to the product go through the R&D process.

All right. Well, I very much appreciate everyone coming today, especially Doctors Nestor and Goldenberg. I very much appreciate it. And we hope to continue this push in May for Skin Cancer Awareness and Melanoma Detection, and we're just thrilled to be a part of that. So thank you, everyone, and thank you, Doctors Nestor and Goldenberg.



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Really Simple Syndication (RSS) is an XML-based format for distributing and aggregating Web content (such as news headlines). Using RSS, web content providers can easily create and disseminate news headlines and URLs. To find more information about common RSS Readers, enter the term “RSS Reader” into an internet search engine.