Q1 2023 Inari Medical Inc Earnings Call

Speaker 2: conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star, then one on a touch tone phone. To withdraw your question, please press star, then two. Please note this event is being recorded.

Speaker 2: I would now like to turn the conference over to Caroline Corner, Investor Relations. Please go ahead.

Speaker 3: Thank you, operator. Welcome to Inari's first quarter of 2023 earnings call. Joining me on today's call are Drew Hykes, President and Chief Executive Officer, and Mitch Hill, Chief Financial Officer. This call will include forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements made on this call that do not relate to matters of historical facts should be considered forward-looking statements.

Speaker 3: nor guarantees an involved known and unknown risks and uncertainties that could cause actual results, performance, or achievements to differ materially from any results, performance, or achievements expressed or implied by the forward-looking statement.

Speaker 3: Please review NARA's most recent filings with the SEC, particularly the risk factors described in the NARA's annual report on Form 10-K for the year ended December 31, 2022 for additional information.

Speaker 3: Any forward-looking statements provided during this call, including projections for future performance, are based on management's expectations as of today. Inari undertakes no obligation to update these statements except as required by applicable law. Inari's press release with first quarter 2023 results is available on Inari's website.

Speaker 3: www.inarimedical.com under the Investor Section and include additional details about Inari's financial results.

Speaker 3: Inari's website also has the latest SEC filings which you are encouraged to review. A recording of today's call will be available on Inari's website by 5 p.m. Pacific time today. Now I would like to turn the call over to Drew for his comments and first quarter 2023 business highlights. Thank you.

Speaker 4: Thank you, Caroline, and thank you everyone for joining us today. Our first quarter was successful and highly productive. Revenue growth was strong, and we executed crisply across all our growth drivers. We presented what we expect to be guideline changing new data from the largest prospective from back to me study ever conducted in high risk PE.

Speaker 4: We received FCA approval for two new products and important FDA label expansions for two additional products.

Speaker 4: all while continuing our work to drive market expansion and uptake of our devices.

Speaker 4: I will share additional detail about all of this shortly, but we'd like to start now, as we always do, with a patient story. This quarter, we highlight a story which underscores the impact of a Nari's commitment to generating high-quality clinical evidence.

Speaker 4: Last month, a 78-year-old grandmother in New England developed back pain and difficulty breathing. She was seen in an emergency room in Diagnose where they high-risk pulmonary embolism. This is the most serious manifestation of PE with a predicted mortality of 25-50% despite existing treatments.

Speaker 4: Thankfully, due to the impact of an RISBT excellence program, the hospital network where she presented had developed a system for rapid triage and she was transferred to a sister institution with the expertise to use flow-treater.

Speaker 4: Her physician had recently been informed of the flame study results, which showed that interventional flow treaver and high-risk PE patients dramatically reduces in hospital mortality.

Speaker 4: Based upon the flame data, her position had the confidence to perform thrombectomy as opposed to treating her with systemic thrombolysis, which is associated with a significant risk of light threatening bleeding.

Speaker 4: Long I see you in hospital stays and poor outcomes.

Speaker 4: At the start of the procedure, her skin was ash and in sweaty. She was near death with a blood pressure of 60 and her heart beating 130 times a minute.

Speaker 4: In a short 45-minute procedure, her doctor was able to remove all of the thrombus, and thanks to floor saver, was able to do so with minimal blood loss.

Speaker 4: While still on the table, her vital signs returned to normal and she remarked to the team about how much better she felt. Most importantly, after a short hospital say, the patient was able to return home to see her grandchildren. This case shows how high quality clinical evidence can change the standard of care in VTE.

Speaker 4: We have never been more committed to generating this evidence. It also shows how our systemic approach to market development is driving a paradigm change in the treatment of VTE.

Speaker 4: Now we'd like to provide a brief summary of our Q1 financial performance. Our revenue in Q1 was 116.2 million, up 34% year over year and 8% sequentially from Q4 2022.

Speaker 4: The performance was driven by strong underlying procedure growth across both the clotsreaver and flow-truver product lines.

Speaker 4: that operating loss in Q1 2023 was $5.3 million.

Speaker 4: As a management team, we're committed to our journey to not only invest strategically in the business, but also drive operating leverage.

Speaker 4: Our Q1 operating loss was a positive step forward.

Speaker 4: Throughout 2023, we will continue to see some fluctuation in quarter to quarter, but as we move into 2024, we remain committed to achieving sustained operating profitability in the first half of the year. We are pleased with our business performing Q1, and we are encouraged by the study progress we're making across all five of our growth drivers.

Speaker 4: Our end markets are large and remain highly underpenetrated, and we continue to see strong momentum in underlying core VTE market dynamics. Despite some ongoing competitive trialling, we remain confident in our ability to protect and extend our position as the clear market leader in VTE for years to come.

Speaker 4: Most importantly, we remain laser focused on the work of developing the VT market for the benefit of patients and continue to view competition as potentially additive to those efforts.

Speaker 4: With that, I'll now turn to our growth drivers. Our first growth driver is the expansion of our sales organization.

Speaker 4: Similar to our most recent quarters, in Q1 we deliberately moderated the pace of our new sales tour additions, exiting the core of just over 290 territories.

Speaker 4: We are pleased with the resulting sales force operating leverage and productivity gains we are beginning to recognize.

Speaker 4: Consistent with this approach, for the remainder of 2023 we expect to continue adding sales professionals each quarter at this more measured cadence and anticipate ending the year with at least 310 territories.

Speaker 4: Continue expansion of our sales organization results in smaller and smaller territories.

Speaker 4: This in turn positions us well to successfully introduce new products to the market and to execute on our second growth driver which is increasing penetration and existing accounts.

Speaker 4: Despite our commercial success and rapid procedural growth, our markets remain highly underpenetrated.

Speaker 4: Still today, the vast majority of VTE patients continue to be treated with anticoagulation alone and never even see a physician who specializes in the treatment of VTE.

Speaker 4: Our VT excellence program is a highly differentiated, comprehensive and repeatable approach to help hospitals establish systems and processes similar to stroke and MI that ensure patients are consistently identified, screened, and evaluated by a VT expert. Although we continue to refine and iterate the program.

Speaker 4: We're making solid progress moving customers through to the most advanced phases of the VTS ones, where tam penetration is 3 to 4 times higher than in the earlier phases.

Speaker 4: To date, most of our efforts with VT excellence have been focused at the local account level. However, building on success we've seen across individual hospitals, recently we have also begun to work with several large IDNs and GPOs at their invitation to replicate VT excellence on a system-wide basis.

Speaker 4: This is another encouraging sign our strategy is working. We believe VT excellence is an important initiative for us for at least two reasons. First and foremost, VT excellence is focused on developing the VT market and changing the standard of care. Secondarily.

Speaker 4: We believe it also clearly differentiates us from both existing and future competition.

Speaker 4: Our third growth driver is to build upon our base of clinical evidence.

Speaker 4: The past several months have been highly productive on this front. The Flame Study was presented as a late-breaking trial at the American College of Cardiology Conference in early March. Flame is the largest ever prospective device study in high-risk PE.

Speaker 4: These are the sickest 10% of PE patients who are in active hemodynamic collapse and historically experienced mortality rate of 25 to 50%.

Speaker 4: The composite primary endpoint and the flow-true or ARMA flame was met and was driven predominantly by an exceedingly low mortality rate of 1.9%.

Speaker 4: This represents a 90% reduction compared to the 29.5% mortality rate seen in patients treated with other therapies in the context arm. The magnitude of this spectacular mortality reduction with flow trooper in a very sick patient population cannot be emphasized enough.

Speaker 4: We believe FLAME will change the standard of care in high-risk PE and, over time, help usher in a new era in PE treatment guidelines.

Speaker 4: We are pleased to see physicians taking notice of the flame data and already beginning to change practice patterns as reflected in our patient story. We envision a day when mechanical intervention with flow trooper and high risk patients is the first line therapy.

Speaker 4: Importantly, we also believe the highly positive results of flame in extremely sick patients

Speaker 4: will be powerful enough to also increase physician confidence in intervening unless sick intermediate risk patients. Keep in mind the intermediate risk PE patient population is 5 times larger than the high risk PE patient population.

Speaker 4: Turning to our randomized control trials, we are pleased to report enrollment in our PIRLIS RCT, comparing flow-triever to catheter-directed litig therapy, has surpassed a half-way mark and enrollment trajectory remains strong. If successful, we believe PIRLIS will end the use of litig-based interventions in intermediate risk PE.

Speaker 4: In DVT, we continue to work through site activations for our defiance RCT comparing clots to revert to any regulation alone.

Speaker 4: The study is designed to establish clot-trever as the standard of care for DBT treatment. Given its importance, we are committed to the hard work ahead to enroll this study. As in pastful as we believe the peerless and defined studies will be to the treatment of VTE, we also envision a third potential RCT over the immediate horizon.

Speaker 4: We will have more to share on this topic soon.

Speaker 4: In summary, we continue to commit significant resources to production of high quality clinical data. Although our efforts are designed to change the standard of care in VTE,

Speaker 4: While not the goal, they also serve to further differentiate and distance in our area from both current and future competition. Our fourth-stroke drivers to expand our product portfolio.

Speaker 4: We have several updates to share here as well.

Speaker 4: First, RevCore received the first-ever FDA clearance for the treatment of instant thrombosis in the Venus Anatomy.

Speaker 4: As is our standard practice, we've recently initiated a limited market release.

Speaker 4: Revcore has been designed to mechanically clear chronic wall adherent clot from inside and occluded venous stem. We estimate there are approximately 90,000 venous stem and planted annually in the U.S. and as many as 10 to 20% occlude within the first two years. Previously, there have been no dedicated tools to address this on that patient.

Speaker 4: Taken together, RevCore represents an important incremental revenue opportunity.

Speaker 4: We'll have more share on the pricing and positioning of breathcore upon full market release.

Speaker 4: Patients with instant thrombosis represent a subset of the broader chronic venous disease patient population, the largest of our new target addressable markets.

Speaker 4: RevCore is the most recent addition to a purpose-built toolkit we are developing for the treatment of CBD. Turning to ProTreef, we continue to be pleased with how the launch is progressing.

Speaker 4: Procterary was a device designed to provide protection to the heart and lungs during complex DBT procedures involving extensive clot, which we estimate is approximately 10 to 15% of all DBT procedures.

Speaker 4: Position feedback isn't positive and we believe there's still a significant runway ahead of us to continue to access new accounts.

Speaker 4: The recent indication expansion for pro-treeb as a sheath for IVC filter removal will add additional momentum to our launch efforts.

Speaker 4: As a reminder, Pro3V is generally sold outside of our Pro Procedure pricing at an ASP of $4,000. Enthrill is also progressing well in full market release. Enthrill is a Tremectomy system designed for small vessels, including AB5 chulas and veins in the upper extremities below the knee.

Speaker 4: The combined total addressable market is 250 to 300,000 procedures per year in the U.S. alone.

Speaker 4: We are encouraged by the positive early clinical results within Thrill and the unmet needs of addresses. The recent indication expansion for Thrill to include the specific treatment of baby fistula and baby graft rhombosis will add additional momentum to our launch efforts.

Speaker 4: At an ASP of $4,000, INSRO represents an incremental $1 billion market opportunity. In summary, our innovation pipeline is as robust as it has ever been, and we anticipate several additional products initiating LMRs during Q2 alone. Our last growth driver is expansion into international markets.

Speaker 4: Q1 marked another quarter of record case and revenue production for international business.

Speaker 4: Our international business generated revenue of 4.3 million in Q1 2023 up 154% over Q1 of 2022 and 30% sequentially from Q4 2022.

Speaker 4: Our performance was primarily driven by continued adoption Europe , where we were pleased to have received MDR approval for plot treaver and flow saver during the quarter. Beyond Europe , during the quarter we also saw solid case growth in our existing markets in Latin America, Canada, and Asia Pacific.

Speaker 4: In China and Japan, we are making progress on our pursuit of regulatory approvals while also developing our go-to-market strategies.

Speaker 4: We have invested heavily in the build-out of our international operations. Given the spectacular unmet need internationally, we believe it's reasonable for this business to represent greater than 20% of total company revenue over time. In closing, the year is off to a strong start. We believe we're making solid progress across all of our growth drivers.

Speaker 4: We have made deliberate investments which are designed to help us treat more patients. These investments will continue to differentiate us from competition, now and into the future.

Speaker 4: Our markets are large and highly under-penetrated, and the unmet needs are significant. Most importantly, our commitment to patients, our people, and solving big problems is unwavering. I cannot be more enthusiastic about the health of our business and believe we can and will grow sustainably for many years to come.

Speaker 4: With that, I'd like to turn things over to Mitch. Thank you, Drew, and good afternoon, everyone. And Nari's revenues for the first quarter of 2023 were 116.2 million, up 29.4 million or 34 percent from 86.8 million for the same period of the prior year, and up 8 percent or 8.4 million sequentially.

Speaker 4: over the fourth quarter of 2022.

Speaker 4: Compared to Q1 of 2022, our revenue growth was due to our continued efforts to open new customer accounts, expand ourselves for us and deepen our relationship with existing customers.

Speaker 4: In 2022, we significantly expanded both the flow treaver and clot treaver product lines and now we begin commercializing the pro-trees and in-thrill products.

Speaker 4: The revenue split between product aligns with similar year over year with 34% of our revenue derived from the sale of Quadtrever and other systems during the first quarter of 2023.

Speaker 4: versus 32% in 2022, and 66% derived from the sale of flow-tree of systems compared to 68% in 2022.

Speaker 4: First margin was 88.2% for the first quarter of 2023 compared with 88.5% in the first quarter of 2022. The decline was primarily due to additions of new products. This adds additional cost of goods sold due to our per procedure pricing model.

Speaker 4: Operating expenses were 107.8 million in the first quarter of 2023 compared with 79.9 million for the same period of the prior year.

Speaker 4: R&D expense was 22.1 million in the first quarter of 2023, compared with 16.1 million for the same period of 2022.

Speaker 4: The 6 million at increase in R&D expense was primarily driven by an increase in headcount.

Speaker 4: SGNA expense was 85.7 million in the first quarter of 2023, compared with 63.7 million for the same period of the prior year. The 22 million increase was primarily due to personnel-related expenses as we increased our headcount and secondarily due to higher travel expenses.

Speaker 4: Net loss for the first quarter of 2023 was 2.2 million compared to a net loss of 3.1 million for the same period of the prior year.

Speaker 4: The basic and fully deluded net loss per share for the first quarter of 2023 was 4 cents based on weighted average basic and fully deluded share count of 54.8 million.

Speaker 4: These compare with a basic and fully diluted net loss per share of 6 cents based on its weighted average basic and fully diluted share count of 51 million for the same period of the prior year.

Speaker 4: As you heard earlier from Drew, we remain committed to our journey towards operating profitability and continue to feel confident in reaching our goal of sustained operating profitability in the first half of 2024.

Speaker 4: Moving to the balance sheet, our cash and investments at the end of Q1 totaled 328.4 million, consisting of 56.6 million of cash and 271.9 million of short-term investments.

Speaker 4: By way of reference, our cash and investments as of the end of Q4 of 2022 were 326.4 million.

Speaker 4: Our cash flows used in operating activities were 2 million for the first quarter of 2023, compared to cash flows.

Speaker 4: used in operating activities of 9.1 million first quarter of 2022.

Speaker 4: Lastly, I'd like to address the NARIS Financial Guidance. For the full year 2023, we are increasing our revenue guidance to 478 to 488 million, up from 470 to 480 million. With that, I'll turn the call back to the Moderate for questions.

Speaker 4: For the Q&A segment, Ju and I will be joined by Dr. Tom Tew and Norey's Chief Medical Officer.

Speaker 2: We will now begin the question and answer session to ask a question you may press star then one on your touch tone phone. If you are using a speaker phone please pick up your handset before pressing the keys. To withdraw your question please press star then two. At this time we will pause momentarily to assemble our roster. The first question comes from Travis.

Speaker 2: Steed with Bank of America. Please go ahead.

Speaker 5: Everybody congrats on the good quarter and thanks for taking the questions. Maybe I'll start with any color you can provide on kind of March, April , what you're seeing, confidence to raise the guide by more than the beat this quarter. And then also anything any additional color on like price versus mix in the uniform volume color you could provide as well. Well, um.

Speaker 4: at this point that would be helpful. Sure, Travis, thanks for those questions. I can take the first one. I think Mitch can comment on the second set of questions. So, during the quarter, you know, we saw strengths and growth throughout each month of the quarter. And the performance was really driven primarily by strong procedural growth across both of the core businesses, flowtreiver and clotreiver. And that was despite...

Speaker 4: you know, the consistent competitive trialing we saw during the quarter. ASPs were stable to modestly up, so that wasn't a big contributor in that 34% revenue growth. New products and new TAMs contributed revenue, certainly, but on a relative basis still relatively modest. And as a percent of revenue,

Speaker 4: Stocking revenue was the lowest in the quarter that had ever been at any time as a public company. So again, I think all that points to strength primarily across the procedures. I think it also points to the health of the market and the payoff of the investments we've been making in.

Speaker 4: market development, program development, high quality evidence, innovation. I think clearly there's a very healthy market backdrop that you see there as you look at the Q1 results. So maybe with that I'll turn things over to Mitch for the mix in the unit comment. Yeah, and Travis, maybe I think you asked about the monthly sort of...

Speaker 2: performance, you know, we're not really commenting on the inter-quarter trends. We did provide some feedback at the time of the February call, just commenting on the strength of the business in January February . The business continued strong during the month of March and I think Q2 is off actually to a very good start.

Speaker 5: to be up to virtually versus Q1. And then maybe a little more color as well as the new product that's on FDA approval just this week on Clotch River XL. And there was the Arctic's AX last week to die what you're assuming on that for the full year God in rolling that out as well as some of the initial feedback in the limited market release products. Yeah, so Travis relative to Q2 and how we're thinking about that, obviously a real...

Speaker 4: and as a result.

Speaker 4: We're anticipating a relatively flatish Q2. Keep in mind even a flatish Q2 would set up about a 25% year on your growth relative to last year. So and then as we look ahead, you know, to the end of the year, the second half of the year, you know, we've got a series of new products coming. You mentioned ARDICS.

Speaker 4: We've got a rev core that is currently working through LMR. We've got a second product working through LMR. We've got three additional products that will be initiating LMR here in Q2 that we're probably not quite ready to talk about yet. But all of that, I think from a product standpoint, really exciting as you look into the second half of the year, continued productivity gains.

Speaker 4: from the field organization as we work through the rest of the year. You know, more progress on BTSO and additional data coming. And then certainly continue traction OUS as well. So I think all that is reflected in the confidence we feel, you know, looking ahead to the end of the year.

Speaker 4: and the corresponding increase in the guides that you heard.

Speaker 4: the corresponding increase in the guidance that you heard. Great, thanks a lot.

Speaker 4: that you heard. Great, thanks a lot. Thank you.

Speaker 2: The next question comes from Cecilia Furlong with Morgan Stanley . Please go ahead. Great. Good afternoon and thank you for taking the questions. I thought for the next six months or so if we were going to get through the whole process

Speaker 6: One of you could comment on what you've seen post-flame, one awareness of the clinical data specifically, but then two, I was talking about the potential both in high risk, but then the slow over impact into how centers are thinking about treating intermediate risk patients. Just would love any color. I know it's early days, but any color on feedback would be helpful.

Speaker 4: Great, Cecilia. I'm happy to take the question. So of course we were very pleased and proud to present the flame study results. I would say that the anticipation of this trial as well as the reception it's received has been...

Speaker 4: Quite fantastic, in fact, we know that at national meeting later on this year it's going to be featured as the most important Venus trial of the year. And I think given the jaw-dropping results in terms of reduction in mortality as well as the safety signal of doing...

Speaker 4: flow-trever in the most challenging, high-risk patients I think can't be understated. Now, you know, we talk a little bit about guidelines and hey, when is this going to be standard of care? I think we're already seeing traction, you know. I can't tell you how many sites have expressed interest in broadening their treatments,

Speaker 4: algorithm to include these high-risk patients, much like the patient's story that we led to call off with. But I think the more important signal here is that spillover effect that you described. High-risk patients are really only 5% of PE presentations, whereas the intermediate risk patient population is at least 5 times or more greater than that population.

Speaker 4: And it stands to reason that if we can get such fantastic results in the high-risk patients, it doesn't at bolster confidence in applying this therapy to the intermediate risk patient population. And of course we'll see that play out over time, but this logic seems to be a lot getting hold for sure.

Speaker 6: Great. And if I could follow up Mitch just on OPEX, how would you think about the cadence to the balance of this year and specifically what you're expecting both from OUS expansion efforts and then on a relative basis versus 22, you're outlook for a more moderated increase to your US sales force?

Speaker 2: Sure. As we look at the OPEX and Q1 and think about where that might go for the balance of the year, we're definitely on the R&D side. The Q1 spend I think is going to be increasing in a very slight fashion as we think about Q2, Q3, Q4.

Speaker 2: From an SGNA point of view, the S side of that is going to continue to increase. As you heard in the prepare remarks, Drew talked about the growth in this commercial sales team from the current level of about 290 up to at least 310 by the end of the year. So that piece continues to grow. And the international side of the business is an area of more aggressive investment.

Speaker 2: We're excited as Drew mentioned talking about the second half of the year with some of their growth opportunities internationally. For example, we'll be fully direct in growing in the Australian Disneyland market in that time frame and that's what we think is a real nice opportunity for us. I'm just using that as an example. So the S-GNA side, I think we can see some potentially say a five.

Speaker 2: 5% or so uptick from Q1 to Q2. And then I think it would be a very modest increase after that for the bounce of the year. Taking all together, the up-ex spend in the company, we see growing at a slower pace than the top line. I think that's a good thing, right? As we move on this path of profitability, and we are still committed as...

Speaker 2: Both Drew and I mentioned in the prepared remarks to this sustained and consistent operating profitability as we get into the first half of 2024.

Speaker 2: mentioned in the prepared remarks to this sustained and consistent operating profitability as we get into the first half of 2024. Great. Thanks for taking the questions.

Speaker 2: Our next question comes from Larry Bygelson with Wells Fargo. Please go ahead. Good afternoon. Thanks for taking the question. Okay. A couple for me here. I'd love to get your reaction to the number of last night. They said their US PE, DBT procedures grew.

Speaker 2: but over 30% quarter over quarter in Q1 and their US peripheral thrombectomy business grew 26% year over year in Q1. What's your reaction to those figures and how did your growth compare? And I have to follow up.

Speaker 4: Sure, thanks for that, Larry. So maybe just to level set, you know, from a market growth standpoint, I think you've heard us in the past forecast that the market growth, we believe, is easily north of 20%. If you define the market as mechanical from back to me for VTE, you know, Q1 regrouped 34%. Our growth in that market is being driven by the continued conversion of lidic-based on a bridge Project Group.

Speaker 4: intervention to flow-triever and clot-triever. We're continuing to put new patients on the table, clearly from conservative medical management to treatment of flow-triever and clot-triever. And we're continuing to protect and extend our market leadership position in the market. We did see consistent trialing.

Speaker 4: during the quarter and looking ahead we would anticipate that trialing continuing. But nothing we've seen to date diminishes our confidence and our ability to continue to extend our leadership. We've got hands down what we believe is the best team in the market.

Speaker 4: We've got a highly differentiated approach to market development, program development. We've got a mountain of clinical data growing bigger by the day.

Speaker 4: story around share loss on our side. And maybe the last comment I'd make on the competitive share dynamics, again, is just to remind everybody this is a $6 billion market that's 5 or 6% penetrated with our technologies. As a result, you know, a point of market growth worth 10X, a point of market share.

Speaker 2: I'm so just a follow up. Same theme. So Q2, you said earlier, Drew, you expected to be flat. And I think previously you expected each quarter to be kind of rateably up roughly 4 million or at least that's what the streets modeling. So it does seem like something has changed. And I guess, you know, I can just imagine, you know, after this call, you know, people are going to ask, you know, how do you know that the flash impact, you know, won't get worse. You know, can you maybe talk a little bit more about what you're seeing with the trialing and customers, you know, and, you know, how sticky things have been versus.

Speaker 2: customers coming back to you know hopefully you understand that yeah basically you know it seems like you're the cadence for Q2 changed a little bit so what changed and how do you you know what give you confidence things won't get worse going forward thanks yeah you know first of all I don't think anything has changed you know the consistent performance from cat 16 that has been has been very consistent throughout the quarter we continue to see and hear from our customers

Hi, good afternoon, everyone. Thank you for taking the questions and congrats on the nice start to the year. Actually, I wanted to circle back on Travis' question around the ClotTriever device approval from last week. Just, I think it's called ClotTriever XI, any color in terms of what that product entails. And then also I'll lump this in. I wanted to ask about RevCore, which I think is, as you mentioned, this is an LMR.

Just what's the feedback there? How do we think about any potential revenue contribution this year and how quickly could that progress to a full market launch? And then I'd follow up. Thanks.

For the second half of your question, I think we can say a little more. You know, RevCore is a novel device. It's a very exciting opportunity to treat a set of patients with really unmet needs that there's no good therapies for. These are patients with chronic venous disease with a clued sense, and there's really no good option for these patients. We now have a device called RevCore, which is able to in limited market release experience, dramatically improve the flow in their sense. We have seen numerous cases of patients suffering for decades with chronic swelling and venous ulcers essentially being healed.

with the use of this device. Some other numbers that we've shared previously, we think about 90,000 venous stems are placed each year, about 10 to 20% of those are occluded within the first two years. And that's just the incidence. There's of course a large prevalence pool of these patients that have accumulated over time. So we think this is going to be an incremental revenue opportunity.

We'll have a lot more to say once we've completed our limited market release experience and go to FMR, but we're very excited about this product. Thanks for the color there Tom, and if I could sneak in one more, I can't help myself and ask about the third potential randomized control trial, which I think you referred to as

being over the immediate horizon. So I guess first can just help us better interpret what immediate horizon means. Is it fair to assume that this could commence in 2023? And then any color on whether this would be for DVT or PE and kind of the purpose of the trial. Is this something to expand indications, change guidelines, you know head-to-head versus competition, etc. Does any

additional details would be much appreciated. Thank you. Sure, sure. I'll tackle that one too, Adam. So I think we have not really kept any great secrets here. We are interested in flexing our clinical muscle here. We have invested heavily in the ability.

we think we can run three simultaneous randomized clinical trials, the first of which being Peerless, the second of which being Defiance, and the third of which, I think I'm at liberty to announce that it's going to be a pulmonary embolism trial comparing flowtriever to anticoagulation, the largest population of patients being treated currently. As far as timing is concerned, you can expect a major announcement coming within weeks at a major meeting to outline the details of this study.

Thanks for the color there Tom. The next question comes from Bill Plavanec with Can Accord. Please go ahead. Great thanks, good evening. Congratulations on a good quarter. My questions are, you know, is I look at the business just based on the mix? Thank you.

You know, really was the DVT business that grew sequentially. You saw some growth in the P. But I just want to understand, as we talk about the new products that you've launched in the first quarter, I would assume all of those are falling under the DVT bucket.

correct me if that's if that's not accurate and then you know just kind of curious as you look at those new products how much did they actually contribute to the growth so how much of it was your core business versus the incremental from new product

Yeah, though, I'll try to tackle that one. We saw actually nice growth from the core products if you will, the flow-triever product family. Typically, that's price, as you know, is a price for procedure for all nine tools in that toolkit. And then the clot-trever has also increasingly sort of migrated into a PPP model because we have multiple tools now that are used by the physician.

their higher rate of revenue growth there compared to the flow tree is because of the inclusion of those products. The products are off to a nice start. They are still going through the vac approval process with all of our hospital clients. So it's still early days, I would say. The revenue contribution in Q1, I would say, is modest for both the pro-tree and from the integral.

is that a recurring given your cash balance? How do we think of that going forward? And thanks for taking my questions. Sure, happy to help with that one. So obviously, from a Treasury management policy, we've elected to keep our investments in a very, very short term sort of category duration. And we actually saw some significant pickup.

the interest earnings of the business. Although we had a million something of such earnings in Q4 of last year, I think it went up to the 4 million range for Q1 of this year. So we're seeing some real nice returns there that's been helpful for us. We think we're in a great cash position as a business and that'll...

provide a lot of flexibility for us in terms of thinking about different growth opportunities and plans for the future. The next question comes from Marie Thybalt with BTIG. Please go ahead.

Hi, thank you for taking the questions and congrats on a great Q1. I wanted to revisit your comments here on GPOs and IDN signing up with you for the VTE Excellence program. I'd like to hear a little more detail on what that looks like. What it could mean for a doctor adoption within those healthcare systems. It's always a little short on that. Help master contrat home. Also to source for feedback,

Thanks for the question, Maria. I'll jump on that first, and Tom may want to add some color as well. I think as you heard us describe in the prepared remarks, we've seen some really exciting developments recently where the work we've been doing, primarily at the hospital level, has now been recognized at the GPO IDN system level. And they're seeing some of the progress that's being made with our program development efforts.

that effort not across those five or six but across our entire system and how can we approach this you know at that level at the system level. So we've had two or three instances of that kind of uptake now at major GPOs and IDNs and I think it gives us as you heard us say in the prepared remarks it gives us

some encouraging evidence that we're on the right track here and that VT excellence is indeed having the kind of impact and having the kind of market impact that it's designed to have and the fact that it's now being picked up at the system level I think is really encouraging and exciting to think how you could extrapolate from here and the kind of impact that that could have. You know anything to... Yeah, you know we've framed our market development work as this...

deceptively simple idea of simply pairing up motivated physicians who want to use our devices to treat patients with patients that are already diagnosed and in the hospital. Of course, it sounds very simple, but it requires quite a bit of work to achieve that kind of consistent identification of these patients. Up until recently, a lot of that work has been grassroots with...

our teams working with champion physicians from the bottom up. You know, you can imagine when the hospital administration, GPOs and IDNs take on this work, you now can meet in the middle with a top-down and bottom-up approach so that we can achieve this STEMI-like goal of consistent identification and triage of these patients to proper physicians.

Okay, very good, very helpful. Thank you. Maybe I can ask a follow up on some of the questions about competition and ask it from a more qualitative approach. I'd like to hear what you're seeing in the accounts when they do decide to use the competitive product or when they decide not to. What are some of the factors that are cited that you hear just on the ground from your sales?

French aspiration platform and PE as we know from our own treaver 16 experience is going to be underpowered and leave clop behind in PE in a similar fashion.

you know, a 16 French aspiration only approach in DVT for, you know, the majority of these patients that have chronic walled ear clot, you're also going to see a clot left behind. So, I think that's maybe one initial area of assessment that we hear feedback on.

I think the second area is around the blood loss. And as you increase the lumen from 12 to 16, you increase exponentially the risk of blood loss.

And I think we've seen lots of instances where, despite the attempted mitigations, there has been a lot of blood loss that's got important clinical implications and safety implications. So I think those are some of the common themes that we hear from a trialing perspective and why again we're seeing a lot of kind of one and done trialing.

While we continue to not have had a single account that has converted from PNUMBRA to an ARIA as a result of the trialing, I think all of that continues to inform our assessment that this is going to be primarily a cannibalization story from CAT-12 to CAT-16 as opposed to a significant change in the competitive landscape.

Cadence commentary they provided, I think you said 2Q would be roughly flat with 1Q. I'm just curious, does that mean, I mean historically 3Q is a seasonally weaker quarter, so is 1Q, does that mean that 2Q and 4Q are your seasonally strongest quarters this year?

I think, Rich, for us, looking back the past couple of years, I think we're still kind of formative in terms of truly understanding the seasonality trends of the business, but our Q2 has had some seasonality sort of impact, we believe.

Little hard to tell back in 2021 because of you know COVID and maybe a little bit of that as well carrying over to 2022. I don't know that we're necessarily sort of pointing at that but definitely as people are out and about and they're ambulating and they're active, you know, it seems to sort of cause a change in terms of the number of people who are experiencing COVID-19.

depending on the number of sort of an NARI interventionalists that are present in each account and when they're available to work and perform procedures. Okay. Thanks for that. And then just going back to Bill's question of new products?

contribution if you will, the clot fever and other, something to a product you're launching. I guess the, you know, the extent you can quantify that would be really helpful. And then also, how did it compare sequentially risk 4Q? Was it up versus 4Q? And then I had one follow-up.

Yeah, the contribution of the approach and the in-throw products was sequentially up, but the contribution in Q1 and for that matter Q4 was modest, I think we call it. I think the use of this product grows in the future and becomes more significant.

We're hoping to provide some more anecdotal feedback about those. But for right now, we're not specifically kind of breaking out the revenue contribution of those guys. We just bundled in with that Klotzrever and other category. usd.com permissions sees more information at kOTA.org.

Got it. And then just the sequential change, I guess clot-treater products were included in the clot-treater volume kind of consideration, but it looks like clot-treater obviously accelerated or increased more on a quarter over quarter basis than flow-treater. I'm just curious if that has any correlation to possibly where trialing of competitive products is getting done, and I'd be curious to hear if…

as trialing in DVT versus PE. I think we feel very good about how our products match up against CAT-16 in either case. We've got purpose-built tools both for PE and DVT. So I don't think we're particularly vulnerable in one or the other and I think we saw a pretty balanced

use and trialing in terms of both procedures as well as the cadence as we move through the quarter.

in terms of both procedures as well as the cadence as we move through the quarter. Thanks guys.

The next question comes from Mike Sarkone with Jeffries. Please go ahead. Good afternoon and thanks for taking my question.

So just a follow up to Rich's question just on, you know, what you need to see to start the disclosing the new product. Is it fair to think because you started to disclose international sales when they hit that high single digit millions mark, is that, you know, a good benchmark to use for when we could expect to see?

or get more quantitative disclosure about some of the newer products? I mean, Mike, that is certainly one possibility. We wanted to, that was one of the factors that kind of went into our thinking about disclosing the international revenue starting with the Q4 numbers for 2022. We also were frankly receiving so many questions about international growth and

I think as you heard earlier in the call, the international outreach of the business has been a significant investment for us now for multiple years running and will actually continue to be for the next few years. So we wanted to provide some visibility in terms of the progress that we're making internationally. And we're very excited about the growth of the business there. The progress that's making in Europe in the sort of North and South America regions as well as in the Asia Pacific region.

Okay, thanks for that. And just one more follow-up on the OUS business. I think you called out about $4.3 million in sales in the first quarter. Can you talk about how that stacked up to your internal expectations and also if you could, you know.

Does revised guidance incorporate any changes to your OUS growth outlook? Yeah, so the OUS business performed very strongly in Q1. I think it was in line, if not slightly above, where we had modeled it to be.

Most of that growth came out of Europe still, although we're seeing some nice traction and some of the other markets that we've started up as well. Certainly, the growth in OUS was contemplated in our guidance. And I think it's an important growth driver for us as we move through this year.

It's still a relatively small part of the overall commercial franchise, obviously, but a really important contributor to the growth, and I think as we move through the rest of this year, that will only increase. I think we're also going to see more balanced OUS.