Q2 2021 Penumbra Inc Earnings Call
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I would like to introduce Mr. Qi Hamlyn Harris Investor Relations for Penumbra, Ms. Hamlyn Harris you May begin your conference.
Thank you operator, and thank you all for joining us on today's call to discuss the numbers earnings release from the second quarter of 2021 copy of the press release and financial tables, which includes a GAAP to non-GAAP reconciliation can be viewed under the investors tab on our company website at Www Dot Penumbra, Inc. Dot com.
During the course of this conference call. The company will make forward looking statements pursuant to the Safe Harbor provisions of the private Securities Litigation Reform Act of 1995, including statements regarding our financial performance commercialization clinical trials regulatory status quality compliance and business trends.
Actual results could differ materially from those stated or implied by our forward looking statements you should certain risks and uncertainties, including those referenced in our 10-K for the year ended December 31, 2020 filed with the SEC.
As a result, we caution you against placing undue reliance on these forward looking statements and we encourage you to review on a periodic filings with the SEC, including the 10-K previously mentioned from a complete review of these factors and other risks that may affect our future results or the market price of our stock, including but not limited to the impact of the COVID-19 pandemic on our business results of.
Operations and financial condition.
Remember disclaims any duty to update or revise our forward looking statements as a result of new information future events developments or otherwise.
On this call certain financial measures are presented on a non-GAAP basis, a reconciliation of GAAP to non-GAAP financial measures is provided in on posted press release.
We anticipate the prepared comments on today's call will run approximately 18 minutes, Adam Elsesser Penumbra, as chairman and CEO will provide a business update Maggie Yuen, our Chief Financial Officer will then discuss our financial results for the second quarter and Jason Mills are executive Vice President of strategy will discuss our updated 2021 guidance with that I would like to turn it over to.
Call to Adam Elsesser.
Yeah.
Thank you cheap and welcome back from your maternity leave.
Good afternoon, everybody. Thank you for joining <unk> second quarter 2021 conference call.
Our total revenues for the second quarter were $184.3 million a year over year increase of 75, 3% as reported and 72, 7% in constant currency and.
On a 9% sequential increase from the prior quarter for.
For the second quarter of 2021, we recorded operating income of $10.3 million or 6% of revenue compared to an operating loss of $18 million during the same period last year.
Both our vascular and neuro businesses performed well in the quarter driven by the breadth and robustness of our product portfolios and diligent work by our outstanding sales teams as well as an uptick in elective procedures likely cause both by the fact that COVID-19 vaccination rates increased.
Some locations and the backlog of elective cases, we obviously are paying close attention to the current news about the spread of the Delta Varian. However, we are not seeing a negative impact on our overall business and believe any future impact will not be different than any of our peers in this industry.
Overall, notwithstanding the news we are optimistic about our ability to help more and more patients and continue to see a lot of opportunities in our target markets to drive strong durable growth over the coming years.
And we continue to see a strong symbiosis between our thrombectomy and embolization franchises in both neuro and vascular through which purposeful innovation in 1 area augments our presence in both.
We also are adding great new people to the penumbra team both on our commercial organization as well as in our senior leadership team.
Starting first with our vascular business, we reported growth of 117, 6% year over year to $107 million in the second quarter.
We are doing important work in 4 large areas of patient need.
Arterial venous coronary and embolization our growth is a function of strong adoption of our products in each of these areas as more physicians begin to learn the benefits of our advanced therapies to treat their patients.
Our recent launch of Lightning 7.
Targeting the arterial anatomy has gone extremely well following on the success, we are having with lightning 12 for the Venus anatomy since its launch last year, we saw strong growth in both existing and new physician customers using our catheters for arterial thrombectomy in large part due to the.
The early success of Lightning 7.
In total there is still a huge opportunity to expand our presence in both arterial and venous going forward.
The Lightning technology, which is now a critical component to both arterial and venous is being very well received by physicians and increasing number of whom are adopting single session therapy, owing to the benefits that accrue in patient outcomes as well as lower cost to the healthcare system.
As many of you know we are running clinical trials and P E. The venous and arterial vascular true with lightning to further learn and help educate our customers on its benefit.
We still have a lot of work in front of us to bring lightning to all the patients who could benefit.
We estimate approximately 90% of applicable patients who have venous and arterial clots are not that are still not being treated with single session therapy. We continue to invest in therapy development initiatives and clinical evidence to expand the reach of these important products.
Staying on the vascular franchise, both our coronary thrombectomy and peripheral embolization franchises also had record quarters in Q2.
With Cat Rx, we are growing our presence within the coronary thrombectomy market and we continue to invest in important clinical work to expand the use of this unique product.
For instance, new data was presented at ACC 2021, and May highlighting the safety and efficacy of cat Rx in patients with high thrombus burden in the coronary.
This work is helping us increase momentum with cat Rx in both academic and high volume institutions on the embolization side, we saw an increase on elective procedures during the second quarter as COVID-19 vaccination to increase in the U S. During the spring and likely enabled hospitals to ramp up.
Procedure volumes.
Given the current state of vaccinations in the spread of new variants of the virus. It is possible that this increase in elective cases normalizes a bit in the third quarter that said, we expect growth trends to continue in this business not just in the United States, but within international markets as well over.
The long term.
In sum all 4 of our vascular franchises are contributing to strong growth in our vascular business guided bard portfolio breadth and purposeful innovation.
We continue to see many attractive opportunities for continued growth and investment in our people products clinical studies and markets going forward.
Let me turn to our neuro business, which also performed well in the second quarter, we reported neuro revenue of $83.6 million worldwide up 42% year over year I am so proud of our neuro team for the great work they've done in recent quarters in the face of a product recall.
And competitive market dynamics.
But now we can look forward to a very exciting future for our stroke axis embolization and neurosurgical franchises there.
The early cases with our new Red 62, distal stroke catheter have gone very well.
Being able to more easily track our robust catheter into the distal anatomy is being well received by our physician customers.
As we continue to expand Red 60, twos presence over the coming months. We are excited to also introduce Red 68, catheter, which recently received FDA clearance in the third catheter in the Red series for which we expect clearance later this quarter.
We look forward to having all 3 of these new products for our physician customers to treat their stroke patients.
Further the.
Ladies and gentlemen, this is <unk>.
Peter I apologize, but there will be a slight a day.
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I know on portfolios, where it kind of.
On page 5.
Thank you for your patience, who will now resume the call.
Alright, sorry, guys I really apologize we had a.
With our phone here and I apologize.
I I'm going to start where I think we left off which is further the breath of our neuro portfolio shine through again this quarter, both our embolization and neuro access portfolios had record quarters.
Ex 96, which launched late last year continues to see increased adoption and utilization across the new interventional field and some our neuro business continues to build back significant momentum. Thanks to the same foundational elements that have made this team and franchise.
The best of its kind in the world for many years, our focus on innovation that delivers better outcomes for patients and a broad portfolio of unique products that help our physician customers treat more patients successfully our neuro team is energized engaged and prepared to deliver.
And our innovation engine is running strawberry well.
In the near future, we look forward to discussing our new paradigm in stroke intervention Thunderbolt.
Moving to our virtual reality business, we have made enormous progress with our real VR platform and are increasingly optimistic. This proprietary platform can help millions of patients across many different clinical and cognitive health care conditions in order to help many distinct patient groups throughout the verge.
Alrighty of health care settings, a few things are very important first proprietary VR technology that can deliver a fully immersive mobile experience for patients.
Second a platform that is adaptable thus.
Thus applicable to many distinct health care settings.
Third a VR experience that can be customized for the needs of patients within each setting and fourth a purposeful engaging rich content library that meets the needs of patients in different settings with different health care needs with this in mind, we will be offering 3 hardware.
Durations and the real system. The I series the T series and the Y series the Y series being a subsequent model of our current product we will be showing.
On the ice series publicly for the first time at the.
HIMSS meeting this week.
We are very excited about the progress we've made across each of these areas, particularly with the help of our extraordinary partner <unk> and we're looking forward to working closely with our robust VR community and therapeutic healthcare to leverage the <unk> platform to help many patients.
Over the coming months and years, we plan to host an investor meeting at Penumbra as campus in Alameda, California on Tuesday September 21 focused exclusively on our <unk> franchise specific details will follow shortly and we will of course be subject to local rules that may.
Change regarding in person events.
We hope you all can join us.
Turning to on update on our international business. We are pleased with continued growth on several fronts. During the second quarter, we made solid progress in China, Japan, Europe, and Canada and continue to see additional opportunities to grow our business in these and other geographies, including Latin America and Asia.
Pacific over the next several years, we plan to expand our product offerings in both neuro and vascular within many international markets, while real VR represents a longer term attractive opportunity for future growth outside the U S as well.
I'll now turn the call over to Maggie to go over our financial results for the quarter.
Thank you Adam good afternoon, everyone today, I will discuss the financial results for the second quarter of 2021 additional details will be contained within our quarterly report on form 10-Q.
For the second quarter ended June 32021, our total revenues were $184.3 million, an increase of 75, 3% reported and 72, 7% in constant currency compared to the second quarter of 2020.
As your graphic mix of sales in the quarter were 69, 7% U S and 33% international.
And international.
Product growth of 64, 5% and 106, 4%, respectively compared to the same period in 2020.
Moving to revenue by franchise.
Revenue from our vascular business grew to $100.7 million in the second quarter of 2021, an increase of 117, 6% reported and 115, 8% in constant currency compared to the same period last year.
Compared to prior quarter revenue from our vascular business grew by 12, 9% driven by strong performance in peripheral thrombectomy and increases in embolization procedure volume in the U S.
Revenue from our neuro business was $83.6 million in the second quarter of 2021, an increase of 42% reported and 38, 8% in constant currency compared to the same period a year ago.
Compared to our performance in this period last year with the COVID-19 impact, we see material growth across neuro access embolization and narrow from back to meat businesses and growth in all regions.
I'm pleased to report all international regions grew sequentially compared to the prior quarter.
Gross margin in the second quarter was 64, 4% compared to 61, 8% in the same quarter last year due to volume leverage and we continue to investing resources to meet demand and new product launches in the second half of 2021.
Looking forward to the balance of this year, we expect our gross margin will normalize at around the same levels as the first 6 months of the year.
Total operating expense for the quarter was $108.4 million or 59% of revenue compared to $82.6 million on <unk>, 79% of revenue for the same quarter last year.
Our research and development expenses for Q2, 2021 were $17.7 million compared to $22.7 million for Q2.2020.
We expect R&D investment to accelerate in the second half of 2021 for new product launches and Thunderbolt.
SG&A expenses for Q2, 2021 were $90.6 million compared to $59.9 million for Q2.2020.
We had temporary cost reduction measures during this quarter in the prior year, such as executive salary reduction, while we continue to invest in commercial resources to support increasing demand for our products.
In addition, modest domestic travel and other in person activities are returning to 2019 levels.
The second quarter of 2021, we recorded operating income of $10.3 million on 6% of revenue.
<unk> to an operating loss of $17.6 million for the same period last year.
We ended the second quarter with a cash cash equivalents and marketable security balance of $239 million at steady working capital.
And now I'd like to turn the call over to Jason to discuss our 2021 guidance.
You Maggie and good afternoon, everybody with the update of our second quarter results. We are formally increasing our 2020, 1 revenue guidance range to $720 million to $730 million, which would represent 28% to 30% growth over 2020 revenue of 564.
<unk> million dollars.
This updated guidance compares to our previous 2021 guidance range of $695 million to $705 million given on our first quarter call in May we see multiple drivers of growth going forward and thus expect our total revenue to increase in the second half of the year as compared to the first.
Half.
We anticipate strong growth in the third quarter compared to the year ago period during which we had 1 of our best product launches ever enlightening 12 on a sequential basis, we expect our revenue in the third quarter to approach our strong second quarter results as we account for the mixed dynamics of the current environment.
Thinking further ahead to the fourth quarter, we expect solid sequential growth via continued strong trends within our vascular business as well as increasing contribution from new products in neuro, namely the Red series of catheters for stroke intervention overall, consistent with our approach to setting guidance in the past.
Our updated 2021 revenue guidance represents our current views on our markets timing of new product launches and other relevant inputs I will now turn the call back to Adam for closing remarks.
Thank you, Jason and Maggie and Chief.
This past year and a half has brought a huge challenges.
And unspeakable loss throughout the world.
However, it has also shown how resilient we all are.
Especially with the continuous wave of changing news it.
It is with these ideas in mind that the extraordinary team at penumbra.
Tenuously year after year looks at areas, where people are suffering from medical conditions and works to find new solutions to make them better.
This drive has been has not been more visible there has been more visible during this past year and a half.
Than ever before.
And it is the reason we are so well positioned to help more and more people in the months and years ahead I.
I want to thank everyone on the penumbra team for doing so much to help so many.
Thank you for your attention and now we would like to open the call to questions. Operator. Please go ahead.
Thank you at this time I would like to remind everyone in order to ask a question Press Star then the number 1 on your telephone keypad.
For just a moment to compile the Q&A roster.
Your first question comes from the line of Bob Hopkins with Bank of America. Your line is open.
Oh great.
Congratulations on a fantastic quarter I just have 2 quick questions first on the.
On the pipeline side and those are some nice updates. Thank you for that just curious on Thunderbolt. Just can you give us a sense as when we will learn more about that product.
And then on real.
Great that its being shown in a meeting this week.
But maybe you can give us a sense for when that will be this latest version will be in full launch. Thank you.
Yeah, Bob Great questions and.
Thanks for your comment as it relates to Thunderbolt I promise you. We will tell you as soon as we can obviously, we don't always control.
The full side of that timing, but we will as soon as we can and obviously.
No.
<unk> to share what I can with you when it's possible so state.
Stay tuned.
We will let you guys know as soon as possible.
As it relates to real.
On.
We're getting it out there in the earliest stages and showing it at this obviously important conference the HIMSS conference with.
The health care community.
We'll update you all at the Investor Day on September 21st with much more detail on on timing and sort of what does that whole look business look like and I think it will make a lot more sense on after the Investor day.
Okay. So stay tuned basically.
On the but I said it nicely.
You did you always do.
So on the on the vascular.
Side of things specifically on mechanical thrombectomy.
Just wondering if you could give us just on.
Little more detail on the phenomenal results here, so you've got arterial venous and coronary here.
Can you just give us a sense as arterial still over 50% of that business and are all these different indications.
Growing at a higher rate or is there a real divergence in the growth rates among those 3.
Then I'll get back on queue. Thank you.
Yes.
Great question.
The growth rates are all strong.
Do they change a little bit based on our product launch of course they do.
We obviously saw.
Lightning 12 have a significant.
Trajectory when we launched it lightning 7 has done well, but all of the franchises are doing well.
And I am very very optimistic.
About how they will all contribute to our growth as we continue on.
As arterial still over 50%.
I don't.
Think we've broken down those numbers, but.
Yeah, Bob it's Jason.
Not broke down those numbers, specifically, what we've said.
In the past is that.
The the Venus mix is obviously increased significantly since we launched lightning 12.
And you know that.
That continues to.
On the venous and arterial.
Besides a business are now both growing quite well so we're not going to break it out specifically the numbers I will talk to you, though that are very similar with those 2 genres are.
The penetration rates, obviously, we have we think somewhere around 90% of the applicable patient populations that can be helped by both our products and both Jan Rose to go here with single session therapy, I know you've heard us say that in the past, but I think it's worth reminding everybody.
Thank you.
Thanks, Bob.
<unk>.
Your next question comes from the line of Larry <unk> with Wells Fargo. Your line is open.
Good afternoon, Thanks for taking the question and I'll Echo Bob Congratulation.
1 just Adam on the on the Covid trends in the second half guidance and 1 on vascular embolization, which was quite strong this quarter. So first on on the recovery.
I heard your prepared remarks, it sounds like so far so good Adam in terms of trends through July and August and.
When I look at the second half guidance, you know third quarter sales approaching Q2.
That's a little bit lower than we've seen sequentially and even looking at the guidance what it implies for Q4, it's a little bit lower than what we saw in Q in 2018 and 19. So my question is is there some conservatism built into the guidance from a.
Potential impact from Covid and I had 1 follow up.
Yes, let me sort of just give a quick general.
The third trend answer and then Jason maybe can pick up there on the specific guidance question.
And why.
What are sort of quarter by quarter implication was versus the actual guidance number.
Overall, we feel extraordinarily comfortable and confident about.
The business obviously the guidance the number itself is not an insignificant reyes.
And that gives us a lot of confidence the news and we put that in in the prepared remarks, that's going on on what is happening is you do have to sort of just catch your breath for a second.
There are a few other specifics adjacent can cover but.
But I would look at the full range of the back half of the year.
As the relevant question in that we feel incredibly strongly about but Jason do you want to add a few things yeah just.
A few things.
Find out the guidance increase obviously.
We feel obviously feel good about and the increases.
A healthy step above the.
Above the number in the quarter relative to that.
The expectations and so I think as you look at sort of the preponderance of the year.
What's transpired is fairly positive.
Across our business.
In both neuro and vascular driving stronger growth than expected.
As it relates to the sequential.
Comments or questions that you had we made comment in the prepared remarks, obviously about elective procedures in.
In the second quarter Thankfully.
We saw during the quarter vaccinations increase throughout the country that obviously gave.
On the ability for hospitals to do more elective cases, and we think that that probably helped.
Get into the elective cases or the volume on the amortization side, specifically in peripheral embolization.
Around $3.5 million to $4 million. So we benefited from that during the quarter in and we're hoping that continues but we have to be cognizant of the current environment with respect to the Delta variant.
That's very helpful. Thank you and on the peripheral embolization, even taking into account I guess, the $3 million to $4 million, maybe catch up Jason if thats, what youre, referring to a second ago still had quite a good quarter.
Adam So I'm just curious.
Our math over $40 million in the quarter.
Our new high.
So how do you see that playing out and what are the growth drivers because you know that's probably the least understood of your businesses. Thanks guys.
Okay.
Yes.
Thank you Larry for that question.
We are continually.
Pleased and thrilled to watch.
And be part of that business, we have continued to innovate in the amortization on the peripheral side for a while we've added a number of new products over the past couple of years and including the Ruby LP line last year.
And the benefit of that technology is is really extraordinary and we've seen it over and over again as people start to try it they migrate to it.
The success, we're having it it's not the field is not us.
Sort of established if you will as 1 might have thought and there's a lot of room for innovation and a lot of.
Sort of conditions that can use coil technology that might not be in using other things that they can now move to coils.
Because of the sort of unique nature of our coil technology, which as you know they tend to be bigger softer.
These year to deploy in many cases.
And we're really finding net.
It is starting to to continue to win over new convert so I think there's a lot of continued room to grow that business.
On both here in the U S. As we said, but also internationally.
<unk> ahead.
Thank you.
Thanks.
Your next question comes from Bill <unk> with Canaccord. Your line is open.
Great. Thanks, Good evening, thanks for taking my questions.
Firstly I'd just like to start off with the neurovascular business I mean, that's a number that we havent seen since 2019 year, almost reaching new highs and I'm just kind of curious the impact of the jet 7 Xtra flex recall I hate to bring up the past, but just making sure where are we in terms of moving through that.
How many accounts do you think you lost or ended up coming back in.
Yes.
<unk> done seeing any impact from that and it's kind of base move forward from here.
Okay.
Bill that's a really good question I think where debt the.
The impact of that obviously.
There was a lot of competitive.
On a trialing and and as people were looking to find a replacement for the Xtra flex catheter.
I think we think you know on our commentary supports this with the new Red series. Both this really great success, we're seeing right out of the box with Red 62, but also with Red 6 day coming in the subsequent red catheter coming.
Later in the quarter I think we look at the back half, particularly the fourth quarter as an opportunity to really re establish ourselves in the stroke field.
<unk>.
We're looking forward to it so.
There is a real need.
For continued innovation in this field that obvious talking to customers. We just had a really successful SaaS.
Meeting as versed in person medical meeting I've been to on a long time.
Since the pandemic and the the the support we heard from physicians the excitement around the fact that we are continually innovating notwithstanding the the.
The recall and everything.
It was as strong as I've heard it in a long long time and it gave me a huge.
Amount of confidence that we're doing the right thing we're on the right track.
And we're getting a lot of encouragement from our physician customers. So.
I'm pretty excited about how our stroke business will unfold over the next.
Sort of 2 to 3 to 4 quarters.
Okay, and then if I could follow up with.
Your SG&A spend was up about $10 million on about $15 million on revenue. So it seems like you're investing forward pretty significantly.
Is that in people.
Is that U S O U S any any color would be greatly appreciated things.
Yeah.
Previously we did continue to investing commercial resources in terms of human resources.
But at the same time on a lot of the domestic travel and in person activities. We also see it rapidly come back to pretty much a pre COVID-19 level and then on at the Lake will be will continue to invest in G&A infrastructure to prepare us to scale.
Great. Thanks for taking my question.
Thanks Bill.
Your next question comes from the line of Robbie Marcus with Jpmorgan. Your line is open.
Oh great.
Congrats on a great quarter.
Thank you Amit.
Maybe another financial question here.
Yeah, theres not much to pick out the quarter.
But 1 thing gross margin came in a little bit below where the street was thinking.
Anything.
1 time in nature or anything we should know and how should we think about maybe the.
The balance of third and fourth quarter.
Yes. Thanks for the question Ravi There is no major.
1 time.
On cost charges in the gross margin I think in the last quarter. We did mentioned that the gross margin can often slightly fluctuate with product and makes and this quarter. It just slightly slight fluctuation on some product mix.
Have no plan to remove any of the Covid safety measure and cost structure that we have put in place given the current.
Delta very unconscious that we we have but meanwhile, we continue to maintain strong productivity and we continue to invest in our capacity as well. So we do expect the second half of 2021 day gross margin will be continuous similar lateral at the first half of the year.
Okay, great maybe.
Maybe just a quick follow up real VR.
And it looks like.
4.
3.3 versions you're spreading out.
Can you give us any sense of what each are tailored for what the market receptivity has been like so far and.
What you think the demand is in the field now that there is a better reimbursement that allows for remote.
You said Jay this thanks.
Yes, it's a great question.
And without solely saying.
Please.
Come to our Investor day on September 21.
I I'll try to just give it a little bit of very general color, because I really don't want to steal the thunder of the team.
Presenting really in great detail. The key here is you know we initially worked on a product solely tailored for a very specific.
On a group of patients. So those were folks who had some form of neurological.
Damage in the brain typically from ischemic stroke could have been a different type of.
Damage and they needed to recover some physical movement.
And the real system was in the first application, which all solder.
First Investor Day was called happy Valley that focused on debt.
We are clearly aware of the huge just extraordinary sort of body of clinical data that supports the use of b or in a host of other conditions and we will go through this again at the Investor day, but.
Not just that relatively obvious use case, but in the mental health and a memory and.
Depression anxiety and a number of other things that people.
It really suffered from in the benefits of BR. So the hardware configurations are really.
Geared toward being appropriate for the variety of settings and types of.
Needs.
Net debt we are we're tackling.
And we'll go through that in greater detail, we're not yet sort of commercializing all of these.
As I said the ice series is simply being shown this week at the HIMSS meeting.
We'll go through the timetable of and the plan around commercializing at the Investor day in a month.
As well.
Great. Thanks, a lot.
Yes, Thanks, Ravi Thanks Robyn.
Your next question comes from the line of Joe on Lynch with Citibank. Your line is open.
Thank you for taking the question and nice quarter.
2 things I want to talk about or ask about 1 was if you used the word clubs symbiosis at the beginning of this call.
And I'd like you to expand on that a little bit and maybe it's on portfolio management term, but that would be helpful. And then my second question has to do with the red serious I'd like to get a better understanding of which are what is the difference between each 1 of these aspiration catheters and momentum.
Look forward to in the third.
The series Thank you.
Yeah.
Yeah.
Great question, the worth I like the word symbiosis.
It is really how the 2 distinct at least how we're interpreting the meaning and if we got it wrong I apologize, but really the 2 distinct parts of our business.
In both neuro and vascular the coil business in the thrombectomy business, which are treating different diseases, how those franchises those product lines.
Have worked sort of in the field with with our customers how one's success in 1 area has sort of opened up opportunities in the other how innovation and 1 has been led.
On to sort of an interest in the rest of our portfolio from physicians.
And it's it's really been remarkable.
And in something that debt to me is is kind of as pure as it can be which is the U S.
We introduce the company and our products to new physicians, who don't know us.
The performance of just the pure clinical performance and utility of our products on.
On 1 side is allowing interest and access to the rest of our business. So that's what we meant by that.
As it relates to the Red series Red.
<unk> 62, as we've talked about.
<unk> is a brand new catheter, particularly sized.
To to treat.
Typically more distal clots in area that we think can have more innovation need more innovation.
The reaction to that product has been really really strong so far.
First of all its track ability is really.
Doing really well we're also hearing some people using it in more.
Proximate locations like the M..1 which to me is a testament to attract ability and ability to hold that shape when your aspiration.
Through it.
Red 68, obviously the size of of Red 68 mirrors a day.
Workhorse product for many years the $8.68.
We've just improved the attract ability.
Of that catheter in a nice way and then the next 1 that's coming we.
We haven't really announced or talked about but we will certainly is clear.
Cleared in.
Look forward to having net on the market as well so really the goal of all of these catheter.
Is what it's always been as track ability first.
You can't do much until you can easily get it there and then its ability to hold its shape and effectively.
And safely aspirate out club.
Thank you.
Yes. Thank you thanks John.
Again, if you would like to ask a question Press Star then the number 1 on your telephone keypad.
Your next question comes from the line of from Margaret Kaczor with William Blair. Your line is open.
Hey, guys. Thanks for taking my question Adam.
And then just wanted to follow up on vascular bed.
Thank you guys had referenced physicians are increasingly adopting simple session therapy. So I was curious if you're sensing that that's on broader market trend and is that being driven by something that you're doing or specific to you all and I'm trying to get us on.
Question, just broadly, saying I get from I'm here I'm ready to go and so this is just share of market penetration or is it still kind of early stage, where they've got to see a few cases and increasingly more patients on.
Yes, I think it's.
I think it's a really really good question.
I I would still put us in the early stages.
It's starting to happen net term for example is out there.
A year ago.
Year, and a half ago no 1 would have talked about it is the goal is to do single session thrombectomy.
So the very fact that we use the term you used that term it's become very obvious debt that that is a is a purposeful goal that is not that is good.
And so that for me is a great sign to the field and I think you know.
There are lots of other companies pursuing this I think that's been.
Very very valuable to the field.
Unlike in some areas, where the field is crowded and competitive on a negative way in other.
Markets. This is.
It's so large and so under tapped I think it's been very beneficial to have companies all sort of in sync on the goal.
And then you know.
Doctors start to move in that direction. The best technology will ultimately win out and obviously, we feel very confident that between this current version and in future versions, we're going to stay in a really good spot, but I still think we're in the early stages, we're still the vast vast.
Majority of of applicable patients are eligible patients are still not getting single session therapy, they're getting multiple day dripping of Tpa and.
That means we have a lot of work in the years ahead, but it feels like the conversation from hearing what the field, saying.
You can now have it.
Some open mindedness at least in the beginning.
So I think there's the beginning of our momentum.
Long will it take.
How much effort, we will be I think we're looking at years of work not months of work.
But but it feels like we've turned a little bit of a corner here.
Okay. So maybe let's take that a little bit further in some of those existing balance where you guys ran on already.
Are you seeing coalition, maybe self selecting certain patients either by risk profile or indication on that Paul you're saying kind of adoption on the field.
Yeah.
I don't I don't know if I can be.
Answer that with the kind of specificity that debt question warrants.
There I'm sure there are physicians who are.
Who still do a little of each I don't know 1 of those people, but I don't want to say they are not it's not true.
That doesn't sound impossible to me.
Certainly the customers debt that are making up.
The bulk of our current business or are mostly people, who have sort of turn that corner.
And believe in it.
And believe in the benefits of the technology and so therefore.
Or using it in all or almost all of their cases.
Okay fantastic Thanks, guys.
Thank you thanks, Thanks Margaret.
Yeah.
There are no further questions at this time Ms Hamlyn Harris I turn the call back over to you.
Thank you operator on behalf of the amendments from <unk>. Thank you all again for joining us today and for your interest in Penumbra, we look forward to updating you on our third quarter call.
This concludes today's conference call you may now disconnect.
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Yes.
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