Q2 2021 Myomo Inc Earnings Call
Good day and welcome to the my Elmo second quarter 2021 financial results conference call. All participants will be in listen only mode should you need assistance. Please signal a conference specialist by pressing Star then zero on your telephone keypad.
After todays presentation, there will be an opportunity to ask questions to ask a question you May Press Star then 1 on your telephone keypad to withdraw your question. Please press Star then 2 please note. This event is being recorded I would now like to turn the conference over to Kim called that's with Alisha.
Please go ahead.
Thank you operator, and good afternoon, everyone welcome to the Myanmar second quarter 2021 financial results conference call earlier today, My Yamana issued a news release announcing financial results for the 3 months ended June 30th 'twenty 'twenty..1 if you would like to be added to the company's email distribution list to receive future announced.
<unk>. Please register on the company's website at my on my Dot Com or call LH day in New York at 21283837, and 77 and speak with Carolyn Curran.
With me on today's call from my Yamamah, Prague, Adonis, Chief Executive Officer, and Dave Henry Chief Financial Officer.
Before we begin I'd like to caution listeners that statements made during this conference call by management other than historical facts are forward looking statements. The words anticipate believe estimate expect intend guidance outlook confidence target project and other similar expressions are typically used to identify such for.
<unk> looking statements.
These forward looking statements are not guarantees of future performance and may involve and are subject to certain risks and uncertainties and other factors may affect on Myanmar business financial condition and operating results, including the impact of the ongoing COVID-19 pandemic.
These and additional risks center uncertainties and other factors are discussed in the risk factors and other qualifications contained in my almost filings with the Securities and Exchange Commission, including the form 10-Q for the quarter ended June 30th 2021 which was filed earlier this afternoon.
Actual outcomes and results may differ materially from what is expressed in or implied by these forward looking statements except as required by law my them. All undertakes no obligation to revise or update any forward looking statements to reflect events or circumstances. After the date of this call.
It is now my pleasure to turn the call over to Paul Good on Us C E O with my Amo Paul. Please go ahead.
Thank you Kim and good afternoon, everyone and thank you for joining us today. After I provide a business update David will review, our second quarter financial results and discuss our financial outlook and following the financial update I'll give some closing remarks, and then we'll take your questions.
As the second quarter began it was heartening to see the large number of vaccinations and the significant drop in the number of COVID-19 cases in the U S and unlike a year ago. Our operations have returned to a more normal pre pandemic environment price deliveries are up significantly from this time, a year ago and our staff is able to gather.
In person once again to work in our new offices in Boston, while others continue to work remotely for in a hybrid mode. We're hopeful that the recent surge in cases will soon be under control and we expect that our business will continue to operate without disruption.
Our overarching goal as a company is to improve the lives of people with upper limb paralysis.
Same time, our focus is on increasing mile bioprocess sales and benefiting from operating leverage as we scale the business towards cash flow breakeven.
We recognized revenue on 80 units during the second quarter up 233% from the pandemic constrained period, a year ago and up 23% sequentially from Q1.
More importantly, the number of authorizations in orders were a record 138 mile pros, which is more than double the number in Q1 and represented nearly $5 million in potential revenue, which will be recorded as these orders are delivered and insurance payments are received.
As a result of the growth in these key metrics, we reported revenues for the quarter of $3.1 million more than Triple last year's Q2 and up 33% sequentially.
The factors driving this growth include the following.
A large number of patient candidates in our pipeline as we started the year with more than 700 patients from the insurance authorization process.
Increased direct to patient marketing, which led to a record number of interested candidates in Q1 and over 650 in total on the first 6 months of the year.
Greater success in obtaining insurance authorizations for patients with approvals from a growing number of Payors and revenue growth in our international operations, especially Germany, where more statutory health insurance payers are covering the cost of the mile per hour.
Our channel strategy is 3 pronged first it consists of our own direct billing operations, where we bill insurers directly in provision on the myopia or with our own clinical staff.
Second we also support orthotics and prosthetics providers in the U S and international markets, who source their own <unk> standards and are responsible for provisioning and billing and third we're focused on VA medical centers for veterans and their care.
During the second quarter revenue from the direct billing channel represented 74 percentage of total revenue compared with 49% a year ago.
Most margin has also improved with this emphasis on the direct billing approach as Dave Henry will describe in a moment.
Backlog is defined as my approach that had been authorized by Payors, but are either in the process of being delivered to users or are awaiting payment to us.
Backlog increased to 160 units at quarter end. This is up from 118 units at the end of Q1, reflecting the large number of insurance authorizations received during the quarter and representing patients who are in the queue to receive their my approach.
After the very strong growth in the patient pipeline in Q1, we added 277, new candidates in Q2 and had an ending pipeline of 898 patients as of June 30th.
We use social media platforms and search engine marketing informed paralyzed individuals and their families about the benefits of the my approach.
At the beginning of the quarter, we did feel the impact of the Apple versus Facebook privacy War on our lead generation as you may be aware Apple implemented new software features and its iPhone operating system to reduce the amount of web tracking that is conducted by Facebook and other platforms. Facebook for example relies on data about where users are going on the internet.
For medical information et cetera to enable advertisers like my elbow to better target their intended audience.
So we adjusted our marketing strategies to this change working with our advertising agency to develop other means on reaching potential candidates and also increasing our AD spending to expand our reach as a result of these changes our weekly regeneration is back up to where it was in the first quarter. When we had very strong growth in new candidates.
We work with patients in the pipeline to obtain a <unk> prescription and supporting clinical documentation from their physician.
It takes several months for these candidates to work their way through the insurance process to an authorization and eventual delivery and payments also expect that between 10 and 20% of pipeline patients drop out each quarter due to personal patient issues and or a lack of insurance approval and so we take this into account in our planning.
Since hick picks codes for the <unk> were issued in 2019, we've seen an increase in patient access to our devices with more payers covering the bio probe on a case by case basis for their beneficiaries and in particular, we experienced strong growth among Medicare advantage plans covering the myocardial.
The huge increase in insurance authorizations in the quarter. It was also due to our chief medical officers outreach to physicians and Payors, including online clinical education program about the micro since Dr. Goldman joined US last fall many more physicians are documenting the medical necessity for their patients in the past few months we've had.
Over 20 insurance plans cover their first myocardial, including state Medicaid plans in Arizona, and Nevada, Utah, and New Jersey, Bluecross Blueshield plans in Maryland, New York State, Rhode Island, multiple Medicare advantage plans, such as care, plus, Florida, and Stanford health care and commercial plans, including balance.
Elect for.
For patients covered by part B standard Medicare we applied for benefit category changed from Jimmy rental to custom fabricated or it's <unk> or brace based on a new rulemaking process that was underway at the centers for Medicare and Medicaid services at the beginning of the year. However.
However, with the change in administration the delay in appointing a new CMS said and a continued focus on COVID-19 inside the agency nothing has happened with this proposed rule. So far so we withdrew our code change amendment and we will follow up with CMS, if and when new rules about correcting devices benefit category are implemented the <unk>.
We continue engage with private and government insurance plans with increasing success as I described earlier.
More recent weeks, we announced that we'd received word that the health care quality Association on accreditation or HQ, a a certifying that my yamal meets the accreditation requirements under the Social Security Act and federal regulations.
This is credit it provider status as an important step following on to our receiving the <unk> codes that was required by the centers for Medicare and Medicaid services as the condition of our Medicare provider authorization. This important step to bringing the mild proto patients whose quality of life can benefit from its use.
Lately, we've been receiving some questions about our supply chain. So I'd like to mention that we are like many other companies that rely on technology components the manufacturer our devices.
While we have been able to source all the necessary items. So far this year, we're spending experiencing some extended lead times in some cases and some cost increases as alternate parts. Our source. We're closely monitoring our supply chain. So that orders are fulfilled on time and there is no impact on our patient deliveries.
Our international business, primarily in Europe, as an important avenue for growth during the second quarter International sales represented approximately 10% of our revenue we have a growing pipeline in Germany. The U K and Italy were also able to have our joint venture formation documents certified by U S and Chinese government agencies during.
The second quarter, thus, enabling wiser medical our JV partner in China to proceed with the filings necessary to establish the business entity in China, we expect that process to be completed during the third quarter.
As a reminder, myoma will hold on to 19, 9% equity interest in the joint venture will also receive an upfront license fee and annual license payments for the next 10 years. The joint venture launch preparations are ongoing and will take some time over the course of this year.
I'd also like to highlight some recent changes to our corporate governance I am pleased to welcome Dr. Milton Morris <unk> Board of directors shareholders elected Dr. Morris in June he is an experienced medical device executive an entrepreneur, who has developed and launched new medical technologies and scaled up operations and we look forward for his contributions.
For our company strategy and growth plans.
I also wanted to mention at the end of the second quarter. We were delighted that my almost stock was added to the Russell Microcap Index. The addition, because it reflects the work that we've been doing to grow the company's valuation to a size that permits inclusion. This group of smaller emerging growth stocks membership in the index will be in place for 1 year.
Now I will turn the call over to Dave Henry Our CFO to review our financial results in more detail I will then come back and provide some additional updates and comments on our plans for the rest of the year Dave.
Thank you Paul.
Turning now to our Q2 financial results revenue in the second quarter of 2021 was $3.1 million and this is up 262% over the prior year second quarter, which of course was adversely impacted by the COVID-19 pandemic I'd like to point out that along with a larger number of mile Pro revenue units. We also had a.
Higher average selling price both year over year and on a sequential quarter basis.
For our Asps contributed to the revenue growth and also reflects the success, we're having with our direct selling channel and our marketing efforts.
More specifically you recognized revenue on 80 mile Pro units in the second quarter of 2021, an increase of 233 per cent compared with the second quarter of 2020, we benefited from a record number of fill units in the second quarter, which are revenue units for which the authorizations and orders were received in the same quarter of the.
80 revenue units 38, we're filling units led by the strength in VA and international channels.
Of those nearly half were direct billing units recall that for certain insurers. Our collection history has been established we're taking revenue at delivery. This is an example of how we are able now to accelerate the revenue cycle and the direct billing channel.
Our backlog of units consist of insurance authorization is received but not yet converted to revenue as of June 32021, our backlog was 160 units ending backlog reflects 138 authorizations in orders on the second quarter, and 16 patients who exited the backlog without converting to revenue.
Approximately 88% of the quarter end backlog is comprised of direct billing candidates compared with 92% at the end of the first quarter.
As Paul mentioned the reimbursement pipeline at June 30 was 898 mile per units, which reflects 277 additions to the pipeline during the quarter and 181 drops which was 19% of the pipeline entering the second quarter.
As a result of our marketing efforts and continued and continued success in obtaining authorizations from new insurers more than 80% of the patients in the pipeline at the end of the second quarter are covered by insurers that are previously reimbursed or agreed to reimburse for the mild growth.
Gross margin for the second quarter of 2021 was 71%. This is up from 51% in the year ago quarter.
The year over year increase primarily reflects a higher average selling price again, reflecting the shift towards direct selling channel.
There were 86 mile Pro use my approach delivered to patients in the second quarter for which we reported cost of goods sold compared to 80 revenue units.
This combined with higher warranty reserves and material price increases on certain constraint components impacted gross margin in the quarter.
As Paul mentioned, we're experiencing longer lead times on certain materials, but we currently believe that we have access to a continuous supply of materials and components.
Operating expenses for the second quarter of 2021 were $4.8 million. This is up 46% compared with the same quarter, a year ago, and primarily reflects higher compensation and advertising costs.
The operating loss for the second quarter of 2021 was $2.6 million and this continued to narrow from $2.8 million a year ago and $2.9 million in the first quarter of this year.
Net loss for the second quarter of 2021 was $2.6 million or <unk> 46 per share compared with a net loss of $3.3 million or $1.12 per share for the second quarter of 2020, and $3 million or <unk> 57, a share for the first quarter of this year.
Adjusted EBITDA for the second quarter of 2021 improved to a negative $2.2 million, which compares with a negative $2.7 million for both the second quarter of 2020, and the first quarter of 2021.
Cash and cash equivalents as of June 32021 were $13.8 million cash.
Cash used by operations was $3.4 million in the second quarter and includes the payment of 2020 incentive compensation.
Turning briefly to our year to date financial results revenue for the 6 months ended June 32021 was $5.4 million up 191% over the prior year period.
The year to date operating loss at net loss attributable to common stockholders were $5.5 million and $5.6 million, respectively, compared with an operating loss of $6.3 million and a net loss attributable to common stockholders of $7.8 million for the 6 months ended June 32020, respectively.
Net loss attributable to common stockholders for the first 6 months.
2020 includes a charge of 500000 related to partial extinguishment of the company's convertible note and approximately 700000 for a deemed dividend on the price reset of certain warrants.
Year to date, adjusted EBITDA improved to a negative for $9 million compared with a negative $6 million on the same period a year ago.
Now I will now address our near term expectations cash.
Cash used in operating activities is expected to decrease sequentially in the third quarter of 2021 due to a lower working capital requirements. We continue to believe our existing cash is sufficient to fund operations well into the second half of 2022.
We continue to expect lower cash utilization in the second half of 2021 compared with the first half with the goal of full year 2021 cash usage usage to be below full year 2020 cash usage.
With our first half results, we're nicely on track to achieve this goal.
Also with a record number of insurance authorizations on orders during the second quarter and a robust backlog for a 160 units as of June 30th along with a growing list of insurance companies reliable you're playing for the mile Pro we expect to be able to deliver solid year over year growth once again in the third quarter.
With that overview I'll turn the call back to Paul.
Thanks, Dave well to reiterate the pillars of our growth strategy are to increase our marketing activity to generate additional patient candidates for the <unk> to increase the number of insurance authorizations by working with payers and physicians to expand access to the <unk> to emphasize our direct to builder channel in the U S.
For greater revenue and margin per unit and to expand its international markets to tap into additional patient demand.
Adding to these growth initiatives is our investment in product development as well as our investment in clinical research.
Demonstrates a positive health outcomes of using a mile from several independent studies are pending publication. This year a new studies are underway that are expected to support our marketing and reimbursement efforts, including an outcomes registry and additional rct's, which we expect to be key components of our body of scientific evidence.
We also look forward to number of near term catalysts, including an upcoming announcement about the adult version of the <unk> and resuming development and launch of the mild Pal orthosis for children.
This concludes the formal part of our presentation operator, we're now ready to open up the call to questions.
We will now begin the question and answer session to ask a question you May Press Star then 1 on your telephone keypad.
If you are using a speaker phone please.
Please pickup your handset before pressing the keys.
At any time. Your question has been addressed and you would like to withdraw your question. Please press Star then 2.
At this time, we will pause momentarily to assemble our roster.
Before we take the first question I wanted to mention that we are available for virtual and a return to in person investor meetings. So please contact <unk> investor relations to set up a time their contact information is on today's news release will also be participating in several virtual and in person conferences during the second.
Half of the year, including H C. Wainwright 20, <unk> annual Global investment Conference Colliers International and the Microcap Rodeo in Austin, Texas in October some of these will be a hybrid conference both in person and virtual and we're very excited that our plans call for in person participation in New York City.
Okay, operator, we're ready for the first question whenever you are.
Thank you for first question comes from Scott Henry with Roth Capital. Please go ahead.
Thank you and good afternoon, I just had a couple questions.
As I look at the model strong second quarter.
Just wanted to get.
Into some other drivers there for.
For starters pipeline adds I think it was 386 in Q1.277 in Q2.
Both good numbers, but obviously Q1 on stronger than Q2.
I think you mentioned that that was that will be bouncing back. So I guess the question is should I think Q3 will look a lot more like Q1 or Q2.
I think Q3 will look closer to Q1, Scott we've already had to this point in the quarter over 100, new patient candidates enter the pipeline.
They came in as a lead they've been on medically evaluated and now they're in the insurance process. So I think we will see an upswing above the Q2 numbers.
Okay.
Do you think and I'm talking about the pipeline pipeline adds.
Closer to the first quarter or do you think maybe you can get all the way into the 3 hundreds for pipeline assets.
In Q3.
We're just over 100 about 1 third of the way through the quarter. So I think we'll do better than Q2 and somewhere in that range between Q2 and Q3, but we'll see how that goes over the next 2 months.
Okay, great. Thank you for that color.
And then the other number that moves around a little bit.
The pipeline that is lost to erosion, sometimes it's 13%, 12%, sometimes its 20% I typically think of that being around 15% with volatility in either direction.
Is that a safe assumption or should I be thinking of that number higher the last couple of quarters or lower.
Hey, Scott.
Yeah the.
On the drops for about 19% of the beginning pipeline so.
I still think.
Somewhere between 15% and 20% is a good number I think.
Whats.
1 thing I will say just to reiterate that of the pipeline.
At the end of the second quarter more than 80% represents pace.
Patients with insurers, who have authorized for the device.
So it's a.
It's a pretty high quality pipeline and we just.
Hopefully.
We will see the drops moderate as we as we go but it's.
The process is still long end and.
On the top reason for patients dropping out because we can't get a hold of me yet so.
Okay. All right that's fair enough. That's helpful. I appreciate the color day. Our final question is just.
On the pricing.
You moved back up I believe kind of seen that that number before but then it dropped down do you think the <unk> pricing is indicative of going forward or might we see it pulled back a little bit just just any color you can provide I would just I would al I would continue to assume that that's the for.
Modeling standpoint that the average selling prices around 35000.
<unk>.
Reimbursements can vary from anywhere from the <unk>.
<unk>.
If it's on LNP provider.
We up all the way up to $90000, which we've had before for.
For for some of the direct billing reimbursement. So it's it's a wide range there.
So given that I would just continue to assume like a mid thirties kind of ASP.
Okay, great. Thank you for taking the question Scott sure.
The next question comes from Jim Sidoti of Sidoti and company. Please go ahead.
Hi, good afternoon call a.
Thanks for taking the question. So a lot has happened with CMS over the past couple of years.
Finally at the bottom line provider.
Got you.
Fixed co you've received accreditation.
But you know that.
When you pulled back the application as Youre waiting on the CMS to make up their final regulations and get their house in order.
Do we think about this going forward how much how many more steps do you think there'll be.
Before you get that code quantified.
Well on our discussions with CMS with shipping on calling ever since we got the <unk> codes.
As you may recall last year towards the end of last year.
Put out a proposed rulemaking, which would enable companies who feel like they are devices on the raw category apply for benefit category changed installed.
And so that's what we did however that rulemaking was never finally approved I think once the administration changed in January everything just stalled over there and it wasn't until recently that a new administrator was appointed.
So what we understand is that CMS will propose that we were making again in the next.
For the 6 weeks and if that and then it takes a while to get comments into decided on it. So if that happens then we will certainly look to us as an opening there to correct that benefit category. So that part b patients get to get access to this in the meantime ever since we got those <unk> codes back in January.
We have 2019, we've been able to address these needs of a large and growing population Medicare advantage plans in fact I saw some recent data.
And that showed that Medicare advantage plans in the last couple of years have gone from 35% to 39% of seniors. So that means 1 hundreds of thousands of additional Medicare eligible patients have opted for Medicare advantage plans and we're getting a number of those to reimburse for the device. So that's a positive trend even if this.
Part B drags on for Awhile.
Yes that was my next observation you tripled revenue in the quarter.
I think I heard you say that you've got 20, new insurance providers.
For your first the device in the quarter so.
How critical is it to get these codes quantified or can you continue to grow without.
I think what you've got strong growth prospects in front of us just.
Just based on what we're doing on a case by case basis, our Chief Medical Officer.
Is now actively engaging with these commercial payers and some of the state Medicaid plans, where we've gotten successful payments over time.
Once there is a large on a bolus of patients that have been approved and as others in the queue and you get the attention of the medical directors of these payers. It takes a while to get those meetings and we expect to have the first several of those meetings in the fall and then you present your case for coverage you've got support from local loss positions.
And other clinical specialists in the area and then pending the medical directors coverage decision and then you go over to the business side of the house to negotiated contracts. So.
It's not a quick process, but it's 1 that we're making steady progress on and hopefully.
Next year. Some time, we would have some of these commercial contracts in place in the meantime, we continue to get repeat orders as Dave mentioned over 80% of our pipeline are without payers that are already paid for myopia.
Or have agreed to under on like on a single case agreement so yes.
We expect that we will continue to focus on that large number of patients that have those insurance plans and keep expanding the number ones that are covering us.
Okay and then the last question for me is on on <unk>.
Analogy.
In the medical device space some of the more mature companies typically.
A slowdown in December quarter, and as folks go on vacation, but you guys moving.
We are growing so fast that hasn't been done.
A factor for you up until now I mean, do you think you're at a point where.
You'll start to see the typical seasonality trends that some of the other companies see.
Well, we are we do believe our guidance is for a strong revenue year over year revenue growth.
In the in the third quarter and we've got a we have a backlog comparable.
Comparable to fourth quarter of last year and recall fourth quarter of last year. We had our we had record revenues. So I think we have a we.
We have the opportunity here.
For a for a very good quarter in third quarter as well.
Okay. Thank you.
The next question comes from Benjamin Hanger.
With Alliance Global Partners. Please go ahead.
Good afternoon, gentlemen, thanks for taking the questions.
First off for me just I know that the.
On the backlog on the revenue units on authorizations.
<unk> had a really solid performance here during the quarter.
And I also realize how pipeline kind of gets the attention just because it's the you know.
The quote unquote top of the funnel did I hear you correctly that now more than 80 per some of the pipeline is with insurers that are reimbursed.
Device previously.
That's right.
And can you give us a sense of what that look like you know a year ago.
I'd have to get back to you on that I don't have that number handy.
A ballpark would be helpful as well I mean it was.
I would assume volume prudently.
I'd say qualitatively, it's better because we have been undertaking a.
Our marketing strategy over the past.
Several quarters now is to try to.
Through the targeting on social media try to target those payers with insurers.
That would reimburse for the device that includes.
Medicare advantage plans and other commercial plans on the past so.
As a purposeful and this is on.
Our purpose for result.
All of the.
Things that we've been doing over the past several quarters. So a number on the exact number I don't have but I'm going to venture to guess, it's higher than what it was a year ago, while the other thing too Ben It's Paul.
As I mentioned, we've been continuing to get more and more payers become first time, micropro reimburses and so that number of payors.
Reimbursing for the device continues to grow quarter after quarter.
Okay.
That makes sense. So every everything should have kind of a virtuous cycle, where the pipeline continues to improve if if you keep executing like you have that.
Yeah, that's right more patients for the pipeline and more of these patients with payers that are covering the device.
It makes sense and then.
38 of the 80 revenue units being ones, where the orders and authorizations occurred in.
During the quarter.
And you mentioned Thats a record is a record bolt on on absolute basis of 38 units, but also on a percentage based on so you don't mean, what about for 48 per cent or so.
On the revenue units were ordered and authorized during the quarter.
What's the right way.
Well on a percentage basis, probably not because we when we were when we were our primary channels for OSP and workday.
A lot of that was.
Turns business so.
But since we really started emphasizing direct billing.
A couple of years ago, it's a record in terms of both absolute number.
And certainly within that it's a record in terms of absolute number but in terms of percentages probably going back to when we.
We started doing direct billing more extensively it's a record for that time period as well.
And that is.
The reason we had so many.
Just to reiterate.
The 30 day, Phil units in the quarter half of those were direct billing and so that was that's the result of.
Being able to recognize revenue upon delivery for those insurers, where we have sufficient collection history. So we don't have to wait until payment to recognize revenue.
So if I'm understanding you correctly then.
If you if you take out.
For the 1 P units and call it let's call. It 60 units in 19, and 19 or so those were direct billing patients that were ordered in.
Authorized during the quarter. So it's like 19 of 60, so like roughly a third.
19 of the 60, where the other the other channels.
Okay.
<unk> and VA.
That's what those were yes.
Okay and then.
I guess last 1 for me and then I'll jump back in the queue.
What proportion of insurers.
Have you established a of like the quarterly revenue here have you established a track record in.
How do you expect that to grow I'm not sure if I'm just yet.
Yeah.
Those insurers that.
We have sufficient collection history on that represented about 40% or so on.
Our.
Our revenue.
And over time, we would look for that to grow as we expand the list of payers that we have sufficient collection history on.
Okay, that's exactly what I was looking for.
Thank you very much gentlemen, and congrats on the quarter.
Thank you thanks Ben.
Again, if you have a question. Please press Star then 1.
The next question comes from Edward Woo with Ascendant capital. Please go ahead.
Yes, congratulations on the quarter guys.
And also congratulations on the growth in Europe, you mentioned that it was 10% of revenue.
What do you think it could be long term, you think you'd get to 50%.
Well the U S market is growing very strong for us.
We've got strong growth in Europe, whether or not it can take more global market share of our revenue.
That will.
And over time.
Clearly with China coming on board more of our revenue will start to come from international.
And it will have to make investments and to open up other markets to really move that percentage up but we're satisfied right now thats in the range of 10% to 15% of our revenue because again overall, we've been growing north of 100% a year.
And Theres other Europe has been.
There are some markets in Europe that have been inaccessible up until now and we still have.
10% of our revenues coming from Europe. So.
As as.
Things with the pandemic start to wane, a bit and and more more countries open up like the UK or Italy.
And others that we have.
Established good relationships with.
I would hope that.
Hopefully that the international part of the revenues will continue to grow.
Would you be able to use the same game plan that you have in the U S focus on direct and also on largest social media marketing.
That would be applicable in Europe, as well as Asia.
While somewhat in.
In these other countries, we go through orthotics and prosthetics practices.
They are licensed in the country.
Have relationships with the various payers they speak for local language of course.
So it's much more difficult for us to establish our own clinical operations. These other countries, but we're very satisfied working with these <unk> partners. We do have now for example, the German website, we are taking some of the.
Marketing activities approach from the U S is starting to do that with social media in places like Germany. So as a result, we're going to take best practices from here to Europe, but we can't replicate exactly what we do here in the United States.
Great well. Thank you for answering my question on that good luck.
Alright, Thank you Edward.
This concludes our question and answer session I would like to turn the conference back over to Paul <unk> for any closing remarks.
Thank you operator, while in closing we are optimistic that the economy here and in other countries will continue to open up and that despite the current increase in cases due to the delta variance the pandemic will abate over the course of the year, assuming that's the case, we expect to accelerate the additions to our patient pipeline and to record strong annual revenue growth for.
Fifth year on a row, we're addressing a very large unmet need with a life changing solution, while contributing and continue along the path to our milestone of breakeven cash flow from operations. So once again, thanks for your time and for your interest in <unk> have a good evening.
The conference has now concluded. Thank you for attending today's presentation you may now disconnect.
Yeah.
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Okay.
Yes.
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