Q4 2022 CVRx Inc Earnings Call

January 26, 2023

Speaker 1: You you F.

Speaker 2: company's SEC filings, including the upcoming Form 10-K that will be filed with the SEC.

Speaker 3: I would now like to turn the call over to CBRX's President and Chief Executive Officer, Nadine Yared.

Speaker 4: Thank you, Mike, and thanks everyone for joining us today.

Speaker 5: I'll begin today's call by providing an overview of our fourth quarter and full year performance, followed by an operational update, a review of our financial results by our CFO Jared O'Sheim, and then I will conclude with our thoughts on 2023 before turning to questions and answers.

Speaker 6: We are very proud of everything that our team accomplished in 2022.

Speaker 7: It has been a great year for CVRX.

Speaker 8: We made progress towards all our strategic initiatives, resulting in the increased adoption and utilization of Peristem, despite several macro disruptions throughout the year.

Speaker 9: This is demonstrated by the fact that our worldwide revenue increased by 72% over 2021, primarily driven by our U.S. heart failure business' 108% annual growth.

Speaker 10: And the year was capped by a strong fourth quarter.

Speaker 11: Our worldwide revenue for the fourth quarter was $7.2 million.

Speaker 12: an increase of 96% over the fourth quarter of 2021.

Speaker 13: Performance in the quarter was driven by the continued expansion of our U.S. sales force and contributions from our marketing initiatives, which led to an increase in U.S. active implanting centers.

Speaker 14: In the US, our heart failure business generated $6.0 million, an increase of more than 121% over the fourth quarter of 2021.

Speaker 15: The increase was primarily driven by continued growth and expansion into new sales territories, new accounts, and increased physician and patient awareness.

Speaker 16: When we went public in the summer of 2021,

Speaker 17: We were in the very early stages of our commercial launch in the US.

Speaker 18: At the time, we expected to consistently grow this business in line with the investment in our commercial organization.

Speaker 19: We are very pleased with how this has played out, with the fourth quarter being our 10th consecutive quarter of increasing US heart failure revenue, with average quarterly sequential growth in excess of 20% since the IPO. Thanks for watching, and please subscribe to our channel for updates on our future videos.

Speaker 20: Starting with the continued expansion of our commercial infrastructure.

Speaker 21: During the quarter, we added three new territories, bringing the total to 26.

Speaker 22: We are excited with the quality of sales talent we have been able to attract and look forward to continue to build upon that quality in 2023.

Speaker 23: During the year, we generated momentum with several of our marketing programs, including our direct-to-consumer or DTC pilot program, our new branding campaign, and patient irrigation programs.

Speaker 24: The DTC pilot program has been successful to date and has had a positive impact on our U.S. business.

Speaker 25: To date, we have made minimal investments in localized DTC campaigns

Speaker 26: And we have seen more than 100 patients undergo a barosteum implant and have a robust pipeline of potential patients with interest in learning whether they are candidates for the therapy.

Speaker 27: We plan to continue to optimize these campaigns to make them more cost effective as we evaluate whether to roll them out more broadly.

Speaker 28: Our second area of focus is innovation of our product portfolio.

Speaker 29: During the second half of 2022, we launched better still Neo2 IPG, the second generation device, which reduces the size of the IPG by 10% and extends battery life by 20%, reducing the frequency of device replacements for patients and their providers.

Speaker 30: It is remarkable how the Neo2 extends longevity while employing a smaller footprint and allows for a streamlining of the implantation procedure.

Speaker 31: Our third focus of area is the expansion of our clinical body of evidence.

Speaker 32: The BHF clinical trial was designed to demonstrate that Verastem provides a mortality and morbidity benefit in addition to a reduction of symptoms of heart failure in patients with reduced ejection fraction.

As previously announced, we accrued the required 320th event in the trial and are working to collect and monitor all the data.

As a reminder, the primary endpoint is a mortality and morbidity composite endpoint.

And we have pre-specified a few potentially meaningful secondary and ancillary endpoints and analysis.

These include a hierarchical win ratio analysis, few COVID sensitivity analysis, and ways to account for the severity of hospitalization.

While we in the steering committee are still blinded to the results.

but also based on how the data collection is progressing.

We now believe that we will be in a position to unblind and share the data before the end of the first quarter of 2023.

Our goal for this post-market trial is to broaden better STEMs labeling.

We plan to submit the totality of the evidence and our corresponding analysis to FDA when we unwind the data.

Please note that FDA is the ultimate decision maker on whether to allow additional claims and new labeling for better stem based on its own evaluation of all the available data.

FDA also seek advice from a panel of independent experts.

At this point, it is difficult to plan for a specific scenario.

The results may produce a conclusion that is more complex and nuanced than a straightforward binary answer.

In addition, we continue to make progress with Batwire, our ultrasound guided implant with CAT

In 2022, we added more sites and more patients into the clinical trial. As a reminder, we expect to complete the trial in 2024.

We announced in late September that we added a veteran medical device executive, Kevin Hykes to our board of directors.

Kevin brings his business acumen and his decades long experience in the field of cardiovascular implantable devices.

Additionally, with the promotion of four leaders to the executive team, we now have eight out of ten of our executives promoted internally.

showcasing the strength and depth of our Talent Bench at CVRx.

In summary, we had a fantastic 2022 as we considerably expanded the adoption and application of Peristim, as seen by 10 consecutive quarters of strong growth in our US heart failure business.

The year was topped off with a successful fourth quarter, during which we continued to push the growth of active and planting facilities in the United States, highlighting once more the benefits that Berrestim can provide to both healthcare professionals and patients with cardiovascular disease.

I'll now turn the call over to Jared to review our financials. Jared?

Thanks, Nnedi. Total revenue generated in the fourth quarter was $7.2 million, which is an increase of $3.5 million, or 96%, when compared to the same period last year. Revenue generated in the U.S. was $6 million for the fourth quarter, which is an increase of 109% over the same period last year.

This increase was primarily driven by continued growth in the US heart failure business as a result of the expansion into new sales territories, new accounts, and increased physician and patient awareness of Barostim.

At the end of the fourth quarter, we had a total of 106 active implanting centers as compared to 46 at the end of Q4 2021 and 91 at the end of Q3 2022. At the end of the fourth quarter, we had a total of 26 territories in the US compared to 14 at the end of Q4 2021.

23 at the end of Q3 2022.

Revenue generated in Europe was $1.2 million in the fourth quarter, which is an increase of 49% when compared to the same period last year.

Total revenue units in Europe increased from 39 in Q4 2021 to 68 in Q4 2022. The revenue increase was primarily due to the lessening impact of the COVID-19 pandemic in Europe . The number of sales territories in Europe remained consistent at 6 during Q4 2022.

Gross profit was $5.7 million for the fourth quarter, an increase of $3 million when compared to the same period last year. Gross margin increased to 79% for the fourth quarter, compared to 73% for the same period last year. Gross margin for the three months ended December 31, 2022, was higher due to a decrease in the cost of the year.

period last year. This change was primarily driven by increases in compensation expenses due to increased headcount. SG&A expenses were $14.1 million for the fourth quarter, which is an increase of 46% when compared to the same period last year. This was primarily driven by an increase in marketing and advertising costs associated with the increase in the

share for the same period last year. Net loss per share was based on approximately 20.6 million weighted average shares outstanding for the fourth quarter and approximately 20.4 million weighted average shares outstanding for the same period last year.

At the end of the fourth quarter, cash and cash equivalents were $106.2 million. Net cash used in operating and investing activities was $10.9 million for the fourth quarter, compared to $7.6 million for the same period last year. We continue to believe we have enough cash on hand to reach cash flow break-even, without needing to raise cash flow break-even.

between $76 and $80 million.

For the first quarter of 2023, we expect to report total revenue between $7.1 and $7.5 million dollars.

I would now like to turn the call back over to Nadim.

Thanks Jared. Before opening the line for questions, I would like to discuss our key areas of focus for 2023 as we seek to drive the increased adoption and utilization of Peristim.

First, the continued expansion of our commercial infrastructure, especially our direct sales force in the United States, remains a top priority. We expect to continue hiring top talent throughout the year and are targeting a total of approximately 38 U.S. territories by the end of 2023.

or on average adding three new territories per quarter.

In addition, we will continue to invest in marketing efforts to help drive increased awareness of Parastem.

Outside of the US, we have added additional talent to our direct sales organization in Germany, and we continue to expect to add incremental headcount in 2023 to support our commercial strategy in that region.

Our second focus area is the expansion of our clinical body of evidence.

Both our post-market study of BTHF and Batfire remain on track with our previous updates.

In regard to Beta chefs

We have been conducting this trial since early 2016 and here we are seven years later. We are looking forward to potentially unblinding the data and sharing the results with you before the end of this quarter.

Looking ahead to 2023, we are very eager to accelerate the development of Peristim by utilizing the positive momentum we have built over the previous two years.

While we are still very early in the commercial ramp in the market penetration, we are totally focused on the significant potential to provide treatment to as many patients as possible.

And now I would like to open the line for questions. Operator.

As a reminder, to ask a question, please press star 11 on your telephone and wait for your name to be announced. To withdraw your question, please press star 11 again. One moment while we compile the Q&A roster.

Our first question will come from the line of Robbie Marcus with JP Morgan. Your line is open. You have cut.

Oh great.

Thanks for taking the questions.

Maybe first, the cash burn is going to be, it looks maybe a bit higher than last year based on the sales and optics guidance.

You talk about a pathway to profitability without further capital raises. How important is a positive readout from Beach AF to getting to that target and any time frames in terms of revenue or years out that we could be thinking about cash flow profitability? Thanks.

Hey, Robbie, thanks for the question. So one thing that we've been consistent on is the model that we built is under the assumption that we get a neutral readout from the morbidity mortality trial. And that's not based on us being pessimistic about the results. It's just us taking a conservative approach. And so —

When we say that we think we still have enough cash on hand to reach cash flow breakeven, it comes with that assumption that morbidity mortality is neutral.

We haven't yet drawn a line in the sand for when, publicly, when we're going to reach that cash flow breakeven point from a run rate perspective. But we do expect this to be the year where we see that cash burn start to flatline to be similar to the burn that we saw in 2022.

And then from there, starting to see the overall burn start to drop on a quarterly basis.

Great. If I just want to dream big and say it is a positive trial, how important has, or how big a barrier has not having a mortality benefit been to driving physician adoption? And if it does...

have a positive. Do you think we should be thinking more like a rapid improvement in adoption following or is there still...

you know, would it have to wait for FDA labeling? So maybe a little time afterwards.

Hey, I'll be here. So thanks for the question. By the way listen when we started this trial in 2016, beginning it in 2016 started enrolling it.

we powered it to win it, right? So we're still hopeful that the data will be clear cut, simple yes answer to all of the questions below. That said,

The real certainty here is the time it takes to get the word out.

First, we'll probably, if there is a meeting, we'll do the announcement of the results during the medical meeting. That if there isn't one, we'll do the announcement of the results during the medical meeting.

close by in terms of time. We don't have to sit on the data for too long, so we'd like to get it out as soon as possible.

So we may end up doing

And basically the next event where we'll invite you and other people who wants to listen in and we'll present ourselves the data.

But that doesn't get it to the conclusion. So we'll have to wait for that medical meeting and do the presentation there via symposium on Ladybreaker.

After that, you've also heard of this. One is the FDA labeling that would allow us to market the data. And the second is the publication of the manuscript. Surprisingly,...

FDA has been faster than most journals.

the median time to publish a manuscript is then given month.

So those are the uncertain elements that would make me hesitate to say yes we will see a pickup in 2023 but the backup in sales will happen in 2024.

But based on your previous question, if the data is positive...

we may decide

So paradoxically we may burn cash a little bit faster earlier.

to follow that, give a little bit of that thought.

Got it. Okay. Just last quick one for me. Is this something you're gonna try and submit for a late breaker at ACC, or do you think you'll miss the date there? Thanks a lot.

Thanks for the question, we don't know yet.

Got it. Okay. Appreciate you taking the questions.

Thank you. If you're still listening, the ACC deadline for Lake breaker has passed.

And that's why we don't know. We don't know if the data will be ready by the end. We're blinded, number one, and if we are, if they would accept us even after the deadline.

Thank you all.

One moment for our next question.

And that will come from the line of Matthew O'Brien with Piper Sandler. Your line is open. Afternoon. Thanks for taking the question. I don't know, Nadim or Jared, which one of you this is for, but I don't want to overstate this too much, but when I look at the...

the unit number in Q4 versus the number of active centers that you had in Q3 and even in Q2, that productivity rate is down somewhat here in Q4. Can you just talk a little bit about why that's the case? message?

the confidence in why those metrics improve so steadily, especially even in Q1 and all the way throughout 2023.

Hi, Matt. This is Jared. I can take that one. So as we look to the productivity for the accounts that we saw throughout 2022, part of this was driven by the success on the addition of new accounts, driving the overall average productivity down. We said early on that

Right when an account starts, we see them treat one or two patients and then they push pause for a period of three, four, five or six months.

They check out the results from a reimbursement perspective, but then also as to how the therapy is going with or doing with their patients.

After they see that, then they start to pick up the pace on their own productivity. So the longer they are with us on average, the more patients they're treating. So we still have confidence that the longer these accounts stay with CBRX, they're going to treat more and more patients based on the data that we've seen collected over the last three years.

But I think the challenge we're facing over the last couple of quarters is that we've exceeded expectations on the number of accounts we were expecting to add, which just drives that overall productivity rate down because of the newness of those new accounts.

Got it makes sense so just to put a finer point on it just because you're up 15 and 20.

Active centers in Q2 and Q3 respectively. That's the reason why that metric is down a little bit and you're not seeing any change from trend line as far as utilization among those accounts as we're kind of exiting that 6 month window.

Yeah, that's correct. Yeah, we're still seeing the centers that have been with us for a couple of years doing more than the centers that have been with us between 1 and 2 years and they're doing more than the centers that have been with us less than 12 months.

Got it. Okay. And then we can get into margins and all the other stuff, which are positive updates, I guess, later. But the other question I did have was really on the DTC campaign. It seems like there's a lot of patients out there and I know it's just a pilot study, but what are you seeing as far as

running some of those studies, getting in front of patients that could be good candidates for this, and then transitioning them all the way through to potentially getting an implant. I app rodline the

care of anyST

Matt, thanks for the question. We have not met our DTC pilot and why we kept it as a pilot for a little bit longer is to understand exactly those questions that you're asking.

They have no idea what form of heart failure they have.

If they have an ICD or a CRT they think they have a pacemaker and I'm over general

It's a disease that's harder to characterize. And when you look at our incidence rate that we calculated, you might have a thousand new patients every year.

That's about four to five percent of the heart failure patients overall. So it's a small percent of the patients It's a game of numbers and we track every single click every single patient when they provide us the information We try to get as much as possible In medical condition as much as we are allowed to know

And if they are seeing their own physician versus seeing how they're going to stop it, to pass diverge.

on a site where we are already activated as well there is a diverse version of the app and it will go much faster on the other hand much slower.

So it's all of those uncertainties that keep this for the time being as a very sensitive part of the society.

Thanks so much.

Got it. Thanks so much. Thank you.

One moment for our next question.

William Blair. Your line is open.

Hey, good afternoon everyone. Thanks for taking the questions. Just because VHS obviously is a short-term catalyst, I was just curious if you can walk us through any commercial marketing changes that you would make based on, let's call it three scenarios where...

You know, the first is positive on morbidity, mortality, or on all events. You know, maybe a more gray area, but numerical improvement in mortality, but not on events, you know, a third of maybe a less good morbidity outcome, or whatever gray area, you know, that would be less good that you would look at. How would that change your behavior, I guess, relative to the guidance that you have?

Thank you, Marguerite. Thanks for the question. Listen, of the three scenarios that you mentioned, let's start from the most negative to the most positive.

The most negative, the data is neutral, there is no benefit to what we are doing. Our plan is built on that scenario. As Jared just mentioned earlier, it's not that we don't believe that we will win, it's just that you know what's by no means representative and would like to establish a baseline that is conservative and consider all of the parts of news as hub sites.

If it's, you know, days.

positive trending positive but not meeting the endpoint itself Then probably there'll be no change in our marketing in the sales strategy. Now if it's a clear-cut part of where we met the most accurate endpoint and that is

that FDA will give us the labeling that this device improves heart failure's outcome.

then it is possible that Jared and I with the approval of our board we may decide to accelerate the

in our sales and marketing effort in the United States. When that would happen, it would take time. You don't feel like adding territories. You have to identify the talent, hire them, train them, and so forth. That ramp will accelerate, but you will not see it overnight.

That answers your question.

That was great. And then, you know, I guess parroting further on that, right? So, the existing accounts who already have, you know, a good sense of training and patient use and history with their own STEM, have you talked to them about what their expectations are for the trial and how they might change their eatles?

Salesforce to be super careful and stick with the FDA approved labeling so that's why they do not engage in speculative discussions regarding outcome.

However, I could do this, explore that, getting feedback's perspective.

With that said, there is one area where our time will increase.

If we hit the endpoint.

when we negotiated the current labeling with FDA back in 2019.

FDA was very clear that we have not met yet the Mottasimor Vasey because it was not what we are blind for.

and TRT devices when they are a class 1 indicated. So QRIs above 150 and the presence of a left dung and right block.

they have a mortality-morbidity benefit.

FDA did not want physicians to prescribe up to 40% of the capacity in those situations. So that's why in our calculation of the total addressable market we excluded patients who are eligible.

This is actually indicated.

for a CRT treatment.

I believe that if we hit the mortality rate endpoint...

I know that we will ask FDA to remove that exclusion and I believe that FDA will accept the exclusion because we should then let the physician decide what therapy is more appropriate for their patients. And labeling would allow us then to position the LSSCP for those patients who are indicated for a CRT device.

So that will increase the total addressable market. It's a little bit to expand on how much Margaz, but at the right time, probably during the discussion about the results, we.

I'm speculating here, but I believe we'll be ready with the updated numbers of the total addressable market at the same time

Thank you, Juan. Great, thanks.

That'd be fantastic. Thanks, guys.

Thank you.

Thank you. One moment for our next question.

That will come from the line of William Plovanik with Canaccord. Your line is open. during the meeting.

Great, thanks. Good evening. Thanks for taking my questions. A lot of them have already been answered, so I think I'll stick with some guidance and P&L stuff. You know, as you talked, you gave us the rep cadence you expect in terms of the new account cadence. Would you expect that to stay the same, or are you shifting more to a go deep strategy?

Hey, Bill, this is Jared. I can handle that one. So from an account perspective, last year we were talking about adding high single digits on a quarterly basis throughout 2022. This year, we're expecting that to be in the range of about 10 to 12 new active implanting centers added on a quarterly basis as we march through 2023. So from an account perspective, last year we were expecting that to be in the range of 12 to 12 new active implanting centers added on a quarterly basis as we march through 2023. From an account perspective, last year we were expecting that to be in the range of

And then there is going to be a bit of work done by the account managers to really start digging a little bit deeper and work in the referral pathway for those centers that are already active. So, the centers that have been around for 12 or 24 months trying to go a little bit deeper reach out to more of the referral cardiologists along the way.

Okay, and that ties into the DTC question, and I think you kind of alluded to the fact, and I want to make sure I heard that right, is this more of an efficiency in terms of spend that you're trying to titrate and find out what is the most efficient?

in terms of getting a patient and converting them all, or getting a lead and converting it through a patient, is that where a lot of the focus on the DTC is today?

Bill, this is Arim, by the way. Thank you for this question. It's an excellent question.

Yeah.

You know...

Direct-to-consumer awareness campaigns that medical device companies did 20 years ago are very different from what we are doing today.

Think about it, what they did back then, putting TV ads with an open loop system. What we're doing is a closed system.

We favor channels where we have traceability of every single click and every single patient.

And everything was just saw the ad and converted. So we know all of those metrics at every single stage of the game.

and the visible tip of the iceberg.

is the marketing campaign itself.

90% of the work is what happened behind the scenes.

consumers who saw the ad all the way to becoming candidates or not becoming to identifying if they are candidates for to

basically offer them possibilities and contacts of sites that are doing the procedure.

Thank you,

for every single one of those campaigns is very closely tracked and monitored almost on a daily basis.

and the project optimize.

We're not in the business right now of throwing money and creating awareness. This is not what you're doing.

We're paying money where we believe that those money would lead to X number of patients. And that equation should be profitable for us from this point. That's what we're trying to explore. As an example, we added a new channel two days ago.

and we'll be testing it for a few weeks, different iteration and see if it's as profitable, more profitable or less profitable than other channels we're using. And that's mainly what we're trying to do here, trying to figure out different geographies, different type of sites, different type of advertisement, different channels between solar and wind.

Okay, good. And then quick, Jared, the 1.136 gain in the other, that's a little... It's kind of a big number. Just curious what that was. And then just... Yeah, we do.

you know, you've kind of went through it with Margaret, but in like, as simply as possible, what would you define as positive? What would you define as neutral? And what would you define as negative for the B2HF outcomes? And I know that's hard to do, but I think for investors.

if you could sum it up, like where are those kind of break points and how should we think about it? Thanks.

Hey, Bill. Just on the first piece of it, I mean, the biggest chunk that's fallen into that other expense net bucket is the interest income that we're seeing from the cash balance that we have at this point in time. So, that's kind of the biggest number there. Nadeem, I'll let you cover the second piece.

Yeah, regarding the.

You know in statistics, well, there is a p-value that you've identified to ensure that the

probably run out as a type one error less than a certain percentage, right? So what FDA wants to know is whether you achieve those results by chance or whether the observation is at the end of reality.

What I consider to be positive is if the primary endpoint met.

the statistical relevance that FDA is looking for.

I would then say it will be in between, you know, the common use of Margaret.

then say it will be in between you know regarding this dirty

either the mortality mobility is trending close to that point but not reaching it or other pre-specified prioritized endpoints that we have previously agreed with FDA to analyze with development.

Why do I say so? Usually, when you're designing a trial for approval, you select an endpoint, after you approve the endpoint, and if you meet the endpoint, you win. If you don't meet the endpoint, you lose. And that's the end of the game.

What we have seen over the past 20 years is medical devices, it's a little bit more complicated than this and FDA has to rely on the totality of evidence.

before they issue a judgment on whether it's unapproved or not.

In our case, our device is already approved.

The benefit outweighs the risk.

according to FDA. So what you're looking for here is what does the device do in other elements that FDA would allow us to tell physicians that yes, they do the right thing.

And that's why it's a little bit more complicated than the usual situation. Even if we don't meet the primary endpoint per se, but we're trying to meet another.

secondary or ancillary endpoint, we still believe that there is a net net positive, not as positive as meaning the primary endpoint, but as net net positive above our base case rate.

Thank you.

Thank you. One moment for our next question.

That will come from the line of Alex Nowak with Craig Hallam. Your line is open. Now I cannot hold your tun Louie slogans are done out by the

Okay, great. Good afternoon, everyone. And perhaps I missed this, but can you expand on what is happening in the background, collecting all the morbidity data to move the readout from the first half to first quarter? You must be seeing something or hearing something to give you that confidence. It's going to come this quarter rather than more in the first half of the year. Welcome.

Hey Alex, this is the rate of monitoring of the data.

So we were just identifying the trend of monitoring of sites.

To ensure that we will have all of the data monitored as required by FDA before we unblank the data.

and based on this trajectory we see we are able and were able to narrow the timeline for the unblinding to now it's a very strong likelihood that this will happen in q1 not in q2

Okay understood, we wouldn'have P a long reopenened matter as a been.

Okay, understood that makes sense.

You're all good. What do you think about the rate of new center ads in 2023? You more than doubled that number in 2022. I'm just going to throw it out that you doubled the number again in 2023. What are you thinking about what the ramping sales team can do this year?

Yeah, Alex, maybe I'll just kind of baseline on that guidance again. So for the US hard-sell your business, the midpoint of the range, the expectation is that we'll be seeing ads of around 10 to 12 active implanting centers on a quarterly basis going forward. Looking to see those longer-term accounts continue to ramp up the price of the market.

there at this point. And so, our base case, the middle of the road of the guidance, is that it would stay consistent at around that million dollars or so per quarter. We saw a bit of an uptick there in the fourth quarter, but some of that was distributors stocking up some shelf units there.

for the first half of 2023. So we don't expect that to be repeated here in the first quarter. So overall, the vast majority of that growth coming from the U.S. hard-tailure business, but most of that revenue is coming from those centers that have already signed up, have already been activated in 2022. And then adding that 10 to 12 per quarter going forward.

Okay, understood. That makes sense. And maybe on that last point, what do you need to happen for Europe to really ramp? Is it just you need to put a little bit more focus on it? You're just focusing too much on the US, probably for good reason. Is it a reimbursement dynamic? How are you thinking about Europe ?

Alex, this is all of the above.

We're here, not in Europe , we're in Germany and a couple of others.

In regard to Germany we have a ZE code from a reimbursement perspective. ZE code is kind of the middle layer. It's not as low as you knew it. It's not as good as DRG.

One of the constraints about the e-code is that the health system has to preach new procedures at the beginning of the year with debt payers.

But even if they pre-negotiated it, they could do the procedure they can still be having after by an entity called the MDS that is made of medical auditors who would come and audit sites. And that kind of scared us of engaging in procedures that are not yet at GRG or are not yet in the guidelines. You can try the whole lab.

And we are neither. And because of this, we are not happy in Germany right now, waiting until we have more data and do more advocacy and education in regard to getting the guidelines in Europe . And it's a chicken and egg.

To get a DRG, we need a certain number of units per year. It's about 1,500 procedures. We have a device that's a high-priced, low number of units, as I've mentioned.

And because of that, it's harder to get 1,500 units in Germany to get into that DRG examination mode.

and all of the above that we have not yet decided to invest heavily in Europe .

Just in the comparison, we have more in our market-stating team than we have of our entire team in Europe right now.

It takes, you know, from an education perspective, physician education, patient education, direct to consumer marketing, the physician-directed marketing team, and so forth. It's a large effort that we provide in the U.S. and the resources right now to duplicate that.

just for Germany in Germany and we don't have the volume to justify being able to do it. And again, it's a chicken and egg one thing you have to decide to do it and break that loop, but right now our focus is in the US. Have I answered your question Alex? Yes, you have. That makes total sense. Really appreciate the update. Thank you.

Thank you so much. Thank you.

Thank you. oppose server archives.

I'm showing no further questions in the queue at this time. I would like to turn the call back over to you Mr. Yard for any closing remarks.

Excellent. Thank you so much, operator. And thanks everyone again for joining us for ourivas as thescenes went Ridley TONEY.

We appreciate it and we look forward to updating you on our progress during our next update. Goodnight

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Good afternoon. Thank you for joining us today for CBRX's fourth quarter and full year 2022 Earnings Conference call. Good afternoon.

Joining me on today's call are the company's President and Chief Executive Officer Nadim Khared and his Chief Financial Officer Jared O'Sheim.

The remarks today will contain forward-looking statements, including statements about financial guidance.

The statements are based on plans and expectations as of today, which may change over time.

In addition, actual results can differ materially due to a number of risks and uncertainties, including those identified in the earnings release issued prior to this call and in the Cas HB see filings.

including the upcoming Form 10-K that will be filed with the SEC.

I would now like to turn the call over to CBRX's President and Chief Executive Officer, Nadine Yared.

Thank you, Mike, and thanks everyone for joining us today.

I'll begin today's call by providing an overview of our fourth quarter and full year performance, followed by an operational update, a review of our financial results by our CFO Jared O'Sheim, and then I will conclude with our thoughts on 2023 before turning to questions and answers.

We are very proud of everything that our team accomplished in 2022.

It has been a great year for CVRX.

We made progress towards all our strategic initiatives, resulting in the increased adoption and utilization of Peristem, despite several macro disruptions throughout the year.

This is demonstrated by the fact that our worldwide revenue increased by 72% over 2021, primarily driven by our U.S. heart failure business' 108% annual growth.

And the year was capped by a strong fourth quarter.

Our worldwide revenue for the fourth quarter was $7.2 million.

an increase of 96% over the fourth quarter of 2021.

Performance in the quarter was driven by the continued expansion of our U.S. sales force and contributions from our marketing initiatives, which led to an increase in U.S. active implanting centers.

In the US, our heart failure business generated $6.0 million, an increase of more than 121% over the fourth quarter of 2021. The increase was primarily driven by continued growth and expansion into new sales territories with 1. mummy and $ in

new accounts, and increase physician and patient awareness.

When we went public in the summer of 2021

We were in the very early stages of our commercial launch in the US.

At the time, we expected to consistently grow this business in line with the investment in our commercial organization.

We are very pleased with how this has played out, with the fourth quarter being our tenth consecutive quarter of increasing US heart failure revenue, with average quarterly sequential growth in excess of 20% since the IPO.

Now for our update on operational developments during the 4th quarter to support greater adoption and use of peristim.

Our focus areas were, one, the continued expansion of commercial infrastructure, two, innovation of our product portfolio, and three, the expansion of the clinical body of evidence.

Starting with a continued expansion of our commercial infrastructure.

During the quarter, we added three new territories, bringing the total to 26.

We are excited with the quality of sales talent we have been able to attract and look forward to continue to build upon that quality in 2023.

During the year, we generated momentum with several of our marketing programs, including our direct-to-consumer or DTC pilot program, our new branding campaign, and patient irrigation programs.

The DTC pilot program has been successful to date and has had a positive impact on our US business.

To date, we have made minimal investments in localized DTC campaigns and we have seen more than 100 patients undergo a barosteum implant and have a robust pipeline of potential patients with interest in learning whether they are candidates for the therapy.

We plan to continue to optimize these campaigns to make them more cost effective as we evaluate whether to roll them out more broadly. Our second area of focus is innovation of our product portfolio.

During the second half of 2022, we launched better still Neo2 IPG, the second generation device, which reduces the size of the IPG by 10% and extends battery life by 20%, reducing the frequency of device replacements for patients and their providers. It is remarkable how the Neo2 extends longevity to the lives of more than 200 people.

that Verustine provides a mortality and morbidity benefit in addition to a reduction of symptoms of heart failure in patients with reduced ejection fraction.

As previously announced, we accrued the required 320th event in the trial and are working to collect and monitor all the data.

As a reminder, the primary endpoint is a mortality and morbidity composite endpoint.

And we have pre-specified a few potentially meaningful secondary and ancillary endpoints and analysis. These include a hierarchical win ratio analysis, few COVID sensitivity analysis, and ways to account for the severity of hospitalization. While we in the steering committee are still blinded to the results, we are still looking for a solution to the

is to broaden better stims labeling.

We plan to submit the totality of the evidence and our corresponding analysis to FDA when we unwind the data.

Please note that the FDA is the ultimate decision-maker on whether to allow additional claims and new labeling for better stem based on its own evaluation of all the available data.

FDM also seek advice from a panel of independent experts.

At this point, it is difficult to plan for a specific scenario.

The results may produce a conclusion that is more complex and nuanced than a straightforward binary answer.

In addition, we continue to make progress with Batwire, our ultrasound guided implant toolkit. In 2022, we added more sites and more patients into the clinical trial. As a reminder, we expect to complete the trial in 2024. We announced, in late September…

that we added the veteran medical device executive, Kevin Hikes, to our board of directors.

Kevin brings his business acumen and his decades-long experience in the field of cardiovascular implantable devices.

Additionally, with the promotion of four leaders to the executive team, we now have eight out of ten of our executives promoted internally, showcasing the strength and depth of our talent bench at CVRX.

In summary, we had a fantastic 2022 as we considerably expanded the adoption and application of Peristim, as seen by 10 consecutive quarters of strong growth in our US heart failure business.

The year was topped off with a successful fourth quarter, during which we continued to push the growth of active and planting facilities in the United States, highlighting once more the benefits that Beresten can provide to both healthcare professionals and patients with cardiovascular disease.

I'll now turn the call over to Jared to review our financials. Jared?

Thanks, Nadim. Total revenue generated in the fourth quarter was $7.2 million, which is an increase of $3.5 million, or 96%, when compared to the same period last year. Revenue generated in the U.S. was $6 million for the fourth quarter, which is an increase of 109% over the same period last year.

Heart failure revenue in the U.S. totaled $6 million in the fourth quarter on a total of 193 revenue units, up 121% as compared to $2.7 million in the same period last year on 95 revenue units.

The increase was primarily driven by continued growth in the U.S. heart failure business as a result of the expansion into new sales territories, new accounts, and increased physician and patient awareness of beryl stem.

in 23 at the end of Q3 2022. Revenue generated in Europe was $1.2 million in the fourth quarter, which is an increase of 49% when compared to the same period last year.

partially offset by a larger percentage of our revenue units coming from full systems versus battery replacements.

Research and development expenses were $3 million for the fourth quarter, which is an increase of 70% when compared to the same period last year. This change was primarily driven by increases in compensation expenses due to increased headcount. SG&A expenses were $14.1 million for the fourth quarter, which is an increase of 46% when compared to the same period last year.

loss of $10.6 million, or 52 cents per share, for the same period last year. Net loss per share was based on approximately 20.6 million weighted average shares outstanding for the fourth quarter and approximately 20.4 million weighted average shares outstanding for the same period last year.

Now turning to guidance. As announced in early January , for the full year of 2023, we expect total revenue between $35 and $38 million.

Gross margin between 78% and 79%. And operating expenses between $76 and $80 million. For the first quarter of 2023, we expect to report total revenue between $7.1 and $7.5 million.

I would now like to turn the call back over to Nadim.

Thanks Jared. Before opening the line for questions, I would like to discuss our key areas of focus for 2023 as we seek to drive the increased adoption and utilization of Peristim.

or, on average, adding three new territories per quarter. In addition, we will continue to invest in marketing efforts to help drive increased awareness of recommendations.

Our second focus area is the expansion of our clinical body of evidence. Both our post-market study of BTHF and bat fire remain on track with our previous updates.

In regard to B2SHAFs, we have been conducting this trial since early 2016. And here we are, seven years later, we are looking forward to potentially unblinding the data and sharing the results with you before the end of this quarter.

Looking ahead to 2023, we are very eager to accelerate the development of Peristim by utilizing the positive momentum we have built over the previous two years.

While we are still very early in the commercial ramp in the market penetration, we are totally focused on the significant potential to provide treatment to as many patients as possible.

And now I would like to open the line for questions.

Operator. Thank you. As a reminder, to ask a question, please press star 1 1 on your telephone and wait for your name to be announced. To withdraw your question, please press star 1 1 again. One moment while we compile the Q&A roster. If the population of your question has a Q&A, please press star 1 1 again. To withdraw your question, press star 2 1 again. As a reminder, to ask a question, please press star 1 1 again. To withdraw your question, please press star 2 1 again.

Our first question will come from the line of Robbie Marcus with JP Morgan. Your line is open.

Our first question will come from the line of Robbie Marcus with JP Morgan. Your line is open. Oh, great. Okay.

Thanks for taking the questions.

Maybe first, the cash burn is going to be, it looks maybe a bit higher than last year based on the sales and optics guidance.

Hey, Robbie, thanks for the question. So one thing that we've been consistent on is the model that we've built is under the assumption that we get a neutral readout from the morbidity mortality trial. And that's not based on us being pessimistic about the results. It's just us taking a conservative approach. And so when we say that we think we still have enough cash on hand to reach cash flow break evening.

comes with that assumption that morbidity mortality is neutral. We haven't yet drawn a line in the sand for when, publicly, when we're going to reach that cash flow breakeven point from a run rate perspective. But we do expect this to be the year where we see that cash burn start to flatline, to be similar to the burn that we saw in 2022.

And then from there, starting to see the overall burn start to drop on a quarterly basis. Great. If I just want to dream big and say it is a positive trial, how important has, or how big a barrier has not having a mortality benefit?

been to driving physician adoption? And if it does have a positive, do you think we should be thinking more like a rapid improvement in adoption following, or is there still?

you know, would it have to wait for FDA labeling? So maybe a little time afterwards. Hey, Nadine here. So thanks for the question, by the way. Listen, when we started this trial in 2015, in 2016, started enrolling it.

would it have to wait for FDA labeling? So maybe a little time afterwards. Hey, Nadine here. So thanks for the question, by the way. Listen, when we started this trial in 2016, beginning it in 2016, started enrolling it, we powered it to win it.

Right, so we're still hopeful that the data will be clear cut simple. Yes answer to all of the questions below. That said,

The real certainty here is the time it takes to get the word out.

close by in terms of time. We don't want to sit on the data for too long, so we'd like to get it out as soon as possible.

So we may end up doing

basically the next event where we'll invite you and other people who want to listen in and we'll present ourselves the data. But that doesn't get it out to us. So we'll have to wait for that medical meeting and do the presentation there, be a symposium on Lady Baker.

After that, you also heard those. One is the FDA labeling that would allow us to market the data. And the second is the publication of the manuscript. Surprisingly, the FDA has allowed us to market the data.

FDA has been faster than most journals.

the median time to publish a manuscript is 10 to 15 months.

So those are the uncertain elements that would make me hesitate to say yes we will see a pickup in 2023 but the pickup in sales will happen in 2024.

But based on your previous question, if the data is positive...

previous question, if the data is positive, we may decide.

So paradoxically we may burn cash a little bit faster earlier.

to follow that, give a little bit of that thought.

Got it. Okay. Just last quick one for me. Is this something you're going to try and submit for a late breaker at ACC or do you think you'll miss the date there? Thanks a lot.

Yeah, thanks for the question. We don't know yet. Got it. Okay. Appreciate you taking the questions.

Thank you. If you're still listening, the deadline for late breaker was has passed. And that's why we don't know we don't know if the data will be ready by the end of the 1 and if we are. If they would accept us even after the deadline.

the If you're still listening the ACC deadline for Lake breaker was has passed and that's why we don't know We don't know if the data will be ready We're blinded number one and if we are if they would accept us even after the deadline you

One moment for our next question.

And that will come from the line of Matthew O'Brien with Piper Sandler. Your line is open. Afternoon. Thanks for taking the questions. I don't know, Nadim or Jared, which one of you this is for, but I don't want to overstate this too much. But when I look at the…

the confidence in why those metrics improve so steadily, especially even in Q1 and all the way throughout 2023.

Yeah, hi, Matt. This is Jared. I can take that one. So as we look to the productivity for the accounts that we saw throughout 2022, part of this was driven by the success on the addition of new accounts driving the overall average productivity down. We've said early on that right when an account starts, we see them treat one or two patients and then they push pause for a period of three.

We still have confidence that the longer these accounts stay with CBRX, they're going to treat more and more patients based on the data that we've seen and collected over the last three years. But I think the challenge we're facing over the last couple of quarters is that we've exceeded expectations on the number of accounts we were expecting to add, which

Just drives that overall productivity rate down because of the newness of those new accounts. Got it makes sense. So just to put a finer point on it, just because you're up 15 and 20.

Yeah, that's correct. Yeah, we're still seeing the centers that have been with us for a couple of years doing more than the centers that have been with us between 1 and 2 years. And they're doing more than the centers that have been with us less than 12 months. Got it. Okay. And then, you know, we can get into margins and all the other, the other stuff, which are positive updates, I guess later. But the other question I did have was really on the DTC campaign.

It seems like there's a lot of patients out there and I know it's just a pilot study, but what are you seeing as far as running some of those studies, getting in front of patients that could be good candidates for this, and then transitioning them all the way through to potentially getting an implant? headlines in 10 minutes.

there's a lot of patients out there and I know it's just a pilot study but what what are you seeing as far as running some of those studies getting in front of patients that could be good candidates for this and then transitioning them all the way through to potentially getting an implant.

Matt, thanks for the question. We don't have our DTC pilot and why we kept it as a pilot still for a little bit longer is to understand exactly those questions that you're asking.

They certainly have no idea what form of heart failure they have.

If they have an ICD or a CRT, they think they have a pacemaker and I'm over generalizing it It's a it's a disease that's harder to characterize and when you look at our incidence rate that we calculated There's about 5,000 new patients every year.

That's about four to five percent of the heart failure patients overall. So it's a small percent of the patients It's a game of numbers and we track every single click every single patient when they provide us the information We try to get as much as possible Medical condition as much as we are allowed to know and If they are seeing their own physician versus seeing how to pass that

nationwide across all centers.

Thanks so much.

Thank you very much. Thank you.

Thank you. One moment for our next question.

And that will come from the line of Margaret Kaysor with William Blair. Your line is open. Hey, good afternoon, everyone. Thanks for taking the questions. You know, just because BHF obviously is one of the short-term catalysts, I was just curious if you can walk us through any commercial marketing changes that you would make based on, you know, let's call it three scenarios. Thanks for Xavier. You know, you called a name of RR, Ellis, and S 159 candidates, maybe. And actually, regardless of who's a

Thank you, Margaret. Thanks for the question. Of the three scenarios that you mentioned, let's start from the most negative to the most positive.

As the most negative, the data is neutral, there is no benefit to what we are doing. Our plan is built on that scenario. As Jared just mentioned earlier, it's not that we don't believe that we will win, it's just that you know what's going on, it's very conservative, and would like to establish a baseline that is conservative and consider all of the positive news as upside.

If it's, you know, day positive, trending positive, but not meeting the endpoint itself, then probably there'll be no change in our marketing and the sales strategy. Now if it's a clear-cut positive where we met the Moitasi Moravita endpoint and that could be higher, then we will have to look back and see what happened, whatever happened

that FDA will give us the labeling that this device improves heart failure's outcome.

then it is possible that Jared and I with the approval of our board we may decide to accelerate the In our sales and marketing efforts in the United States and when that would happen it will take time, you know a you don't

So, the existing accounts who already have, you know, a good sense of training and patient use and history with VeriStim, have you talked to them about what their expectations are for the trial and how they might change their utilization once the data is announced?

I'll also make one more and walk us through how they would view their TAM opportunity changing should one of those more positive scenarios come up.

It is a question and now I wonder if I should have spoken with some positions about this. Number one, we instruct our Salesforce to be super careful and stick with the FDA approved labeling. So that's why they do not engage in speculative discussions regarding outcome.

However, I could do this, explore that from a feedback perspective. That said, there is one area where our time will increase.

If we hit the endpoint.

When we negotiated the current labeling with FDA back in 2019, FDA was very clear that we have not met yet the metasimabrasion because it was not what we are blinded for.... TRT devices when they are a class 1 indicated.

So QRIs above 150 and the presence of a left dumbbell bread block, they have a mortality morbidity benefit.

FDA did not want physicians to prescribe other devices in those situations. So that's why in our calculation of the total addressable market we excluded patients who are eligible.

did not want physicians to prescribe other devices in those situations. So that's why in our calculation of the total addressable market we excluded patients who are eligible to't alright and, we hi accepted that.

for a CRT treatment. I believe that if we hit the mortality rate end point

I know that we will ask FDA to remove that exclusion and I believe that FDA will accept the exclusion because we should then let the physician decide what therapy is more appropriate for their patients and the labeling would allow us then for those patients who are indicated for a CRT device.

So that will increase the total addressable market. It's a little bit, we have to expand on how much, Margaz, but at the right time, probably during the discussion about the results, we.

I'm speculating here, but I believe we'll be ready with the updated numbers of the total addressable market at the same time.

here but I believe we'll be ready with the updated numbers of the total addressable market at the same time. Thank you Juan. Great, thanks.

That'd be fantastic. Thanks, guys. Thank you.

Thank you. One moment for our next question. That will come from the line of William Plovanik with Canaccord. Your line is open.

Great, thanks. Good evening. Thanks for taking my questions. A lot of them have already been answered, so I think I'll stick with some guidance and P&L stuff. You know, as you talked, you gave us the rep cadence you expect. In terms of the new account cadence, would you expect that to stay the same or are you shifting more to a go deep strategy?

Hey Bill, this is Jared, I can handle that one. So from an account perspective, last year we were talking about adding high single digits on a quarterly basis throughout 2022. This year we're expecting that to be in the range of about 10 to 12 new active implanting centers added on a quarterly basis as we march through 2023.

And then there is going to be a bit of work done by the account managers to really start digging a little bit deeper and working the referral pathway for those centers that are already active. So the centers that have been around for 12 or 24 months trying to go a little bit deeper, reach out to more of the referral cardiologists along the way.

Okay, and that ties into the DTC question, and I think you kind of alluded to the fact, and I wanna make sure I heard that right, is this more of a efficiency in terms of spend that you're trying to titrate and find out what is the most efficient?

in terms of getting a patient and converting them all or getting a lead and converting it through a patient is that we're allowed to focus on the DTC is today. Bill, the same, by the way, thank you for this question. It's an excellent question. Yes. You know.

Direct-to-consumer awareness campaigns that medical device companies did 20 years ago are very different from what we are doing today.

Think about it, what they did back then, putting TV ads with an open loop system, what we're doing is a closed loop system. We favor channels where we have traceability of every single click and every single patient.

And everything I saw the ad and convert it so we know all of those metrics at every single stage of the game

and the visible tip of the iceberg.

is the marketing campaign itself. 90% of the work is what happened behind the scenes.

consumers who saw the ad all the way to becoming candidates or not becoming to identifying if they are can just be corrected for to

who saw the ad all the way to becoming candidates or not becoming to identifying if they are candidates for to

basically offer them possibilities and contacts of sites that are doing the procedure.

for every single one of those campaigns is very closely tracked and monitored almost on a daily basis.

and we're perfect to optimize. We're not in the business right now of throwing money and creating awareness. This is not what we're doing.

we're paying money where we believe that those money would lead to X number of patients. And that equation should be profitable for us from day one. That's what we're trying to explore. As an example, we added a new channel two days ago.

The 1.136 gain in the other, that's a little, you know, it's kind of a big number. Just curious what that was. And then just, you know, you've kind of went through it with Margaret, but in like, as simply as possible, what would you define as positive, what would you define as neutral, what would you define as negative?

for the BDHF outcomes. And I know that's hard to do, but I think for investors, you know, if you could sum it up, like where are those kind of break points and how should we think about it? Thanks. Hey, Bill, just on the first piece of it, I mean, the biggest chunk that's fallen into that other expense net bucket is

is the interest income that we're seeing from the cash balance that we have at this point in time. So that's kind of the biggest number there, and the demo will let you cover the second piece.

Yeah, regarding the set of speed, you know, in statistics, Bill, there is a p-value that you've identified to ensure that the type one error is less than a certain percentage, right? So what FDA wants to know is whether you achieve those results as a fluke, by chance, or whether the optics are correct, especially if the result thus far may have no predictability to it.

and to use applied array.

if either the mortality mobility is trending close to that point but not reaching it or what if other pre-specified prioritized endpoints that we have previously agreed with FDA to analyze would be relevant.

Why do I say so? Usually, when you're designing a trial for approval, you select an endpoint, and if you approve the endpoint, and if you need the endpoint, you win. If you don't need the endpoint, you lose. And that's the end of the game.

What we have seen over the past 20 years is that in medical devices, it's a little bit more complicated than this. And FDA has to rely on the totality of evidence before they issue a judgment on whether it's approved or not.

In our case, our device is already approved.

In our case, our device is already approved. The benefits outweigh the risks.

according to FDA. So what you're looking for here is what does the device do in other elements that FDA would allow us to tell physicians that yes, the device is being used.

And that's why it's a little bit more complicated than the usual situation. And even if we don't meet the primary endpoint per se, but we're trending to this point, we meet another secondary or ancillary endpoint, we still believe that there is a net net positive, not as positive as meeting the primary endpoint, but as a net positive above our base case.

Thank you. Thank you. One moment for our next question. That will come from the line of Alex Nowak with Craig Hallam. Your line is open. Okay, great. Good afternoon, everyone. Perhaps I missed this, but can you expand on what is happening in the next two weeks? My question for you has been with product PrideRegister.

the data but the rate of collection of the data and the rate of monitoring of the data. So we're just verifying the trend of monitoring of sites to ensure that we will have all of the data monitored as required by FDA before we are blind in the day.

and based on this trajectory we see we are able and were able to narrow the timeline for the unblinding to now it's a very strong likelihood that this will happen in q1 not in q2

Okay understood ether, we would clear be long reopen MAT as a did.

Okay, understood that makes sense. You're all good. What do you think about the rate of new center ads in 2023? You more than doubled that number in 2022. I'm just gonna throw it out there, double the number again in 2023. Or what are you thinking about what the ramping sales team can do this year? Yeah, Alex, maybe I'll just kind of baseline on that guidance again. So for the US...

as I just looked to the hypertension business in the US, it's still flat, right? It's a set patient population. And then just one more piece on the European side of it. We still haven't necessarily cracked the code over there at this point. And so our base case, the middle of the road of the guidance is that it would stay consistent at around that million dollars or so per quarter. We saw a bit of a...

that revenue is coming from those centers that have already signed up, have already been activated in 2022, and then adding that 10 to 12 per quarter going forward.

Okay, understood. That makes sense. And maybe on that last point, what do you need to happen for Europe to really ramp? Is it just you need to put a little bit more focus on it? You're just focusing too much on the US for obviously good reason. Is it a reimbursement dynamic? How are you thinking about Europe ?

Alex, this is all of the above.

We're really not in Europe , put in Germany and a couple of other countries. In regard to Germany, we have a ZE code from a reimbursement perspective. ZE code is kind of the middle layer, it's not as low as you knew it, it's not as good as DRG. One of the constraints about ZE codes is that the health care has to preach the procedures at the beginning of the year with their payers.

But even if they have pre-negotiated it, they could do the procedure, they can still be panicked after by an entity called the MDS that is made of medical auditors who would come on our site. And that kind of gives us this hassle of engaging in procedures that are not yet at DRG or are not yet in the guidelines. For more tips on dermal food clean up or to specializedknown healthier videos go to.

And we are neither. And because of this, we are not entirely, in Germany right now, waiting until we have more data and do, you know, more advocacy and education in regard to getting the guidelines in Europe . And it's a chicken and egg. To get a DRG, we need a certain number of units per year.

It's about 1500 procedures. We have a device that's a high price, low number of units.

And because of that it's harder to get 1,500 units in Germany to get into that DRG examination mode.

and all of the above that we have not yet decided to invest heavily in...

Europe . Just in the comparison, we have more in our market-stating team than we have of our entire team in Europe right now.

Just for Germany in Germany and we don't have the volume to justify being able to do it And again, it's a chicken and the egg one They have to decide to do it and break that loop but right now our focus is in the u.s. Have I answered the question Alex?

Yes, you have. That makes total sense. Really appreciate the update. Thank you. Thank you so much.

makes total sense. Really appreciate the update. Thank you. Thank you so much.

I'm showing no further questions in the queue at this time. I would like to turn the call back over to you Mr. Yard for any closing remarks.

Excellent. Thank you so much, operator. And thanks everyone again for joining us for our fourth quarter earnings call.

We appreciate your support and we look forward to updating you on our progress during our next update. Good night

Thank you all for participating. This concludes today's program. You may now disconnect.

Q4 2022 CVRx Inc Earnings Call

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