Q2 2023 Establishment Labs Holdings Inc Earnings Call
Good afternoon, welcome to establishment Labs' second quarter 2023 earnings call.
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I'll now turn the call over to Raj gently Chief Financial Officer. Please go ahead.
Thank you operator, and thank you everyone for joining US with me today is the one that's H come curious our chief Executive Officer.
Following our prepared remarks, we'll take your questions before we begin I would like to remind you that comments made by management. During this call will include forward looking statements and the meetings of the federal Securities laws.
These include statements on established large financial outlook, and the company's plans and timing for product development and sales.
These forward looking statements are based on management's current expectations and involve risks and uncertainties for a discussion of the principal risk factors and uncertainties that may affect our performance or cause actual results to differ materially from these statements I encourage you to review our most recent annual and quarterly reports on Form 10-K, and Form 10-Q as well as the other etsy should filings, which are available on our web.
Right at establish a lapsed dot com.
Please also note that establish a last received an investigational device exemption from the FDA from a T V implants and is undergoing clinical trials to support regulatory approval in the United States.
We continually seek to expand the geographies in which our products are regulatory approved.
Please check your local authorities for specific product availability.
Content of this conference call contains time sensitive information accurate only as of date of this live broadcast August eight 2023.
Except as required by law establish a lab undertakes no obligation to revise or otherwise update any statements to reflect or events or circumstances.
After the date of this call.
It is my pleasure to turn the call over to our CEO Juan Jose.
Thank you Raj and good afternoon, everyone revenue in the second quarter of 2023 totaled $48 $6 million, an 18% increase over the second quarter of 2022 and a new quarterly records for our company.
We are growing well in excess of our underlying markets and there are a number of positive catalysts, we expect over the coming months all of which is providing a strong foundation on which to build for 'twenty 'twenty four and beyond.
Raj will provide additional details on our second quarter performance and our outlook in a moment.
On July 19, the five year anniversary of our listing as a public company, we held the Grand opening of our Xu Lei them innovation campus.
We're 400 people attended the event, including Representatives of the Costa Rican government plastic surgeons distributors from around the world suppliers and other business partners.
The new campus supports our strategic plans with additional capacity and capabilities in R&D manufacturing digital media training and medical education. This year, we will bring online approximately 35000 square feet of new manufacturing and warehouse space.
More than doubles, our manufacturing capacity to over one 5 million units a year, which is about half the current global demand.
We also have the ability to add an additional 45000 square feet of manufacturing as our growth requires.
The new facilities include advanced R&D labs, and a global learning center that allows us to produce content that we can stream around the world.
The onsite surgical theater and procedure rooms allow for medical education, and training that can scale to a global business and help us expand the market include brought demand for our product.
The state of the art facility was designed to be carbon neutral and use of sustainable materials and other green design elements and standards throughout.
Our goal was to build a center for creation and innovation, where our employees health care professionals and partners come over the world can Usher new standards for the future of plastic surgery and with the opening of the Sudan. We are certain we have succeeded.
We are better positioned than we have ever been to create and expand in new markets and to make a minimal change in the lives of women around the world.
One of the most exciting near term opportunities for us cause me F. M Tech with the recent approval in Europe of the tools needed. The global rollout of this new category in breast aesthetics is picking up pace. Our launch activities are centered on creating these new category with a growing list of certified partner clinics, we are strengthening.
Our pipeline of partner clinics with new centers in Japan, Spain, Switzerland, Sweden, Germany, England, Costa Rica in France with more request every week to join we have created branding and marketing programs localized for each market that are directed at creating and capturing consumer.
Demand in Spain, where we launched our first campaign in July the first week saw us generate over 175 leads 30 of which resulted in patients seeking appointments. Most importantly, 47% of these patients were not seeking a breast augmentation prior to learning about meal.
As a reminder, as part of the media experience a plastic surgeon can shape depressed.
15 minutes minimally invasive procedure without the need for general anesthesia.
Result is natural and discrete with a one to two comp proportionate result.
See you requires minimal downtime with women returning to most activities the same day.
By providing a solution that overcomes many of the obstacles of traditional breast augmentation. We are opening up a whole new group of women to breast aesthetics.
It is still early in the launch of meal and we remain focused on bringing women into this new category of breakfast statics as plastic surgeons see improved efficiency with our partner clinics benefiting from better economics. We are seeing early proof points that we can scale. This new category with me into a multibillion dollar opportunity.
Our static breast we can franchise the rollout apartments, you left flora tissue Expander continues we developed Florida to provide surgeons into women, who we see these devices better options. Despite one in eight women developing breast cancer tissue Expanders before Florida have seen little meaningful innovation in decades among the.
In Florida, our first of its kind RFID enabled court, which allows for MRI imaging without artifacts during the time and expand their use after a mastectomy.
Non magnetic Florida also opens new options for radiation oncology treatment floor out also features our patented self friendly smooth silk surface technology, which can offer improved patient comfort and healthy capsule formation.
The market feedback is very positive and we are seeing an increasing number of clinical publications confirming the benefits of Florida.
A recent publication out of Switzerland was the first in human study to confirm that Florida does not expect the image quality of artifact prone image sequences doing MRI a fundamental improvement in the standard of care for women undergoing breast reconstruction with tissue Expanders.
Recent publication out of South Korea demonstrated that in radiotherapy planning the Motiva, Florida, we did non metallic RFID enabled port showed superior to see metric results to the heart and lungs versus traditional metallic ports potentially reducing side effects to this audience.
If I eat board materials also would use artifacts on seafood imaging compared to the metals used in conventional expanders.
In another recently published paper.
<unk> just at the medical University of Innsbruck in Austria, we're able to confirm in a head to head study that floor provides much improved patient comfort and satisfaction in their breast reconstruction journey compared to when the FDA approve expander.
Global Medical device company focused on womens health establishment labs has the opportunity and the responsibility to improve breast reconstruction, Florida is only the first step in our aesthetic breast Recon initiative, where establishment labs will offer tools and techniques that allow women to receive reconstructive surgeries that are cheap.
Static ideals to which they aspire.
On China, we are actively preparing for the launch of my team up with our distribution partner.
Continue to make progress in the regulatory process and expect to launch months even in this market later this year.
We have been an active communication with our partners in China to close to final questions remaining before regulatory approval.
In the U S. The final module of our PMA was submitted to the FDA in the first quarter and the full PMA has now been accepted it is under review by the agency.
The pace of activity in our interactions with the agency remain positive clinical sites around the country have now undergone there by more inspections, bringing us closer in this process of approval it is difficult to predict regulatory timelines, but nothing in the process. Thus far has diminished our confidence that when people buy implants will be available soon.
Two women in the United States.
I will now turn the call over to Raj.
Thank you Juan Jose.
Total revenue for the second quarter was $48 $6 million, which was growth of 18% from.
From a regional perspective sales in Europe Middle East Africa were approximately 42% of the global total Asia Pacific, 24% in Latin American made up the balance.
Direct sales were approximately 37% of implant sales, while distributors made up the balance.
Brazil, which is our single largest market globally accounted for approximately 14% of total quarterly my chief of sales our gross profit for the second quarter was $33 million or 62, 3% of revenue compared to $27 5 million or 66, 7% of revenue for the same period in 2022.
Our gross profit in the second quarter was negatively impacted by higher overhead and labor costs direct labor costs were higher in part from changes in foreign exchange rates between the U S dollar and a co street in Cologne.
As you report in U S dollars, a significant revaluation of the Clos and over the last year resulted in higher costs in the period.
We're also absorbing the early startup costs for the training and certification EMEA clinics, which is reflected in cost of goods.
Average selling prices in the second quarter up from the first quarter of 2023 and year over year, which confirms that we are providing increased value even while we continue to take market share.
SG&A expenses for the second quarter increased approximately $4 million to $37 million compared with $33 million in the second quarter of 2022.
The increase in SG&A in the second quarter resulted in part from our investments in new growth initiatives like me our preparations for launch in the United States and the underlying growth in our business.
R&D expenses for the second quarter increased approximately $2 million from the same quarter, a year ago to $6 $9 million.
Higher personnel costs and increased activity related to the U S clinical trial contributors to higher spending this period.
Total operating expenses for the second quarter were $44 million, an increase of approximately $6 $1 million from the year ago period.
Yeah.
Net loss from operations for the second quarter was $13 $7 million compared to a net loss of $10 $4 million in the same period in 2022.
Cash position as of June 30 was $90 2 million compared.
Compared to $66 $4 million at the end of 2022.
Our cash position reflects the one point to six 5 million share offering a complete in late April as well as cash use in the second quarter that included approximately $9 million of investment in capex, including for our new manufacturing facility.
Well as a planned increase in inventory as we prepare for the launches of Motiva and Chinese United States had further growth we expect in the near future.
As a reminder, we have two remaining tranches on our debt facility, which totaled $50 million and become available and the achievements of sales and regulatory milestones.
Along with the cash we have on hand at the end of two to provide us with access to approximately $140 million in capital.
Under our current forecasts to cash we currently have on hand, as well as the additional capital available to us under our credit facility will allow us to achieve cash flow profitability, while still funding our growth initiatives.
We are maintaining our revenue guidance for 2023, and a range of $200 million to $210 million.
So a couple of things to note in the cadence of revenue for the second half of the year.
We expect approval and launch them, which even China in the fourth quarter.
Also me launch in Europe in the summer months, which is a seasonally slower period, we expect to me of consultations to begin in earnest in the third quarter and procedures to contribute more meaningfully in the fourth quarter of the year.
Overall, we continue to see good momentum in the underlying business, we expect to have a very strong finish to the year.
We expect gross margin in 2023 to be approximately 100 basis points lower than 2022, which reflects higher overhead and labor costs. The cost of the global roll out of me, yet and the startup of manufacturing and even Chile on facility.
Continue to see regular fluctuations in gross margin. However, they are trained in our gross margin is expected to be positive over time.
The prices, we expect to realize for our products in the U S and China, which are the highest paying in the world.
A tailwind to our gross margins as we take share in these new markets.
We continue to expect operating expenses as a percentage of revenue in 2023 to be similar to 2022.
Operating spending over the near term is reflecting our investments in development to commercialization programs. However, expect expenses as a percentage of revenue will trend down as you move into these initiatives and begin to leverage our spending I will now turn the call back to Juan Jose.
Thank you Raj.
During the opening of display them campus, we held the discovery session as part of their program.
Session highlighted the scientific and clinical foundations that have been laid over the last two decades, and which have led to the products we've introduced to the market.
When do you buy implants, Joy Yep, amtech and floor, Oh, we're defining breast aesthetics and reconstruction and they're driving the strong growth we are seeing globally.
And fundamentally changing the current landscape the technologies behind them have provided platforms that we are now developing into new offerings with taking the minimally invasive platform develop wouldn't be attempted and they're leveraging it into a new minimally invasive aesthetic categories. The first of which is minimally invasive gluteal ergonomic model.
<unk>, which we call gem.
The market for gluteal augmentation in 2021 was estimated by ISS International Society of aesthetic plastic surgeons to be 523000 procedures globally.
She is a 41% increase from just four years ago.
Despite this strong demand the current options are lacking with high rates of morbidity and mortality.
We have an initial IRB approved study underway and are encourage by what we have seen so far we.
We are early in the development of this new product and procedure and will provide updates as we make progress.
Since 2014, our implants have been available within RFID sensor platform, we call QAD it.
Passive privacy proven sensor provides identification information about the device such as a serial number data manufacturing and others.
60% of our devices in the market now include the QAD technology and in many markets women are selecting devices with Q I D four to one or more over non QAD devices.
We will soon introduce the next version of our sensor platform, which we are calling that.
This new platform continues to be passive, but he's non metallic and will add additional capabilities such as the measurement of temperature. This feature in particular core temperature is a very useful biomarker and would then we have a device which can provide measurements in real time.
Temperature is only the first of what we hope will be a suite of Biomarkers enabled by the Sam platform.
German Zen are just two of the many exciting things we are working on and the expanded capabilities in our new suite of Yum campus research and development Medical education media and manufacturing will enable us to develop them to their full potential.
We remain confident that the target we offered earlier this year of $500 million in revenue in 2020 six will be proven conservative and with the continued contribution of our existing product portfolio and the growing contribution of new solutions like Jim and then we believe that we will continue to.
ROE at a healthy clip well beyond 2026.
I will now turn the call over to the operator for your questions.
Thank you well now be conducting a question and answer session.
If you'd like to ask a question today. Please press star one from your telephone keypad.
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Thank you and our first question comes from the line of Matt Taylor with Jefferies. Please proceed with your questions.
Hey, Great. This is actually young Li in for Matt Thanks for taking our questions.
Hum.
Our.
You know, Matt maybe on the China launch I think you mentioned in Q4.
So you're using the same distributor.
<unk> been using in South Korea.
And you're gonna be replicating a lot of the Korean strategy for the China launch I guess, you know since China. The D. C market I was wondering you know how you think about the the adoption curve.
How china might be different versus some of the other key markets.
Yes, Thank you and I think it's important to remind everyone that China is the fastest growing breast aesthetics market in the world and of course, we are super excited about this opportunity.
Already you know when the countries around China, we've been doing a lot of activities to create awareness about motiva implants and make them the implant of choice.
We are market leaders in Japan, and Taiwan, and South Korea, and Vietnam, and Thailand, which tells you a lot. How you know the Asian consumer has seen you know the opportunity with Motiva as the implant of choice before the pandemic you know we had around 25%.
Of consumers and South Korea, coming from China to get the Motiva implants, and when you look at the data coming from China would you see is that patients to request premium brands. The brand reputation is highly valued by hospitals in our market research shows that doors, you know a good reception.
And great image to the Motiva Brent. So we think that you know given the importance of this launch and everything that we are preparing with our partner we will be successful in gaining the same type of traction that we've gained in the rest of Asia.
Alright excellent my follow up is on the Oh, you know very early in the launch but wanted to hear a little bit about how you think the launch is going versus your expectation it.
Sounds like the AR the Spanish experience is very positive so far and confirms the market expanding opportunity How's the Japan launch going you know what are some of the positive or negative surprises that youre seeing so far.
Okay.
Yes, I mean, there is you know just exciting breast harmonization new category and you know what we are seeing is that this value preposition.
His opening breast aesthetics to a whole new group of women just to give you. An example, you know what we are seeing for instance in Spain.
When we launch our first campaign just.
Just last month, you know in one week, we had 175 leads.
And that led to 30 foot 30 patients seeking appointments with clinics, but more importantly, 47% of those patients were not seeking a breast augmentation and that's what's exciting to US is that we are talking about a true new category and market expansion.
You know we're strengthening the pipeline, we now have new clinics, taking you know D certification process in place.
In Germany.
In the United Kingdom, and also in even Japan now it's early on but it's very promising in Japan. It will go slower for one very simple reason compliance we have to comply with you know many rules in Japan that are restricted to us communicating directly.
To consumers, so it's going to take a little longer there's going to be more word of mouth, but you know when we see the results, especially the outcomes for patients and the response to the experience you know of course, we feel like it's going to get there in terms of the patient acceptance and the increase in awareness.
Satisfaction.
Alright, Thank you very much.
Our next question is from the line of Anthony Petrone with Mizuho Group. Please proceed with your questions.
Well congrats on a strong quarter here and as well as for the opening and in Costa Rica, and thanks for hosting it was a great event.
Maybe just pivoting to motiva.
U S clearance, obviously, the PMA submitted here.
Yeah, just wondering shorted the behind the scenes mechanics here you know how many how many rounds of questioning.
You know do you expect from F. D. A N I would assume that there's no panel.
Needed here, but I could be wrong is there any thoughts on the need for an advisory panel.
For clearance of Motiva in the U S. And then I'll I'll have a couple of follow ups.
Yes, Thank you Anthony and you.
It's important to know that we submitted.
The full PMA was accepted for review by the agency.
You know we are trying to be very careful to keeping to the propriety of the trial by not disclosing too many details, but I can tell you. Some things that you know will you know we'll give you. Some some comfort regarding your question about now all of our clinical sites around the country have now undergone to buy more inspections, which are.
Bringing us closer to you know do your approval also you know we had the hundred date meeting which was held in June of this year and we're still waiting for the you know.
Inspection of our manufacturing.
But you know all of our interactions with the agency have been very collaborative and the level of interaction is great. So nothing at this point makes us think that there will be a panel.
Okay. Okay, and then just a follow up sure one would be on an on Jim unveiled at a silly one campus opening you mentioned Juan Jose 523000 procedures globally.
I just wonder if there's any pricing data you can share on glue yolande plants relative to breast augmentation and then wanting there I'll just sneak in for Raj when we think of the new campus manufacturing as that expands.
But also as we layer in price from from China for instance, and possibly the U S. Yeah. How should we think about gross margin, let's say over the next two years from the <unk> level. Thanks, again and congrats on a good quarter.
Well first the.
Interest from consumers on contour statics and in particular, our glue chiller statics has been increasing over the last few years and when you look at that number you know more than half a million procedures per year of course, you know as a women's health company. We are looking to solve for the problems that we have.
In terms of safety and the quality of the outcomes. So you know what is the correct pricing for that procedure I think we will narrow as we you know we gather more data and you know we do more market research, but I think you know you know when you. When you look at EMEA is in premium procedure compared to traditional.
The breast aesthetics I think you can use a similar mindset do you think about you know what Jim could be compared to traditional diesel chill options.
Hey, Anthony so on the gross margin we are absorbing several things right now as we noted in the prepared remarks, you know their co street in Cologne in particular has revalued about 25% in the second quarter alone, So where we're up against that headwind right now, but as we move out of this and into next year, when we launched into rock.
Into China, and then hopefully in the U S. Very soon the tailwind at our gross margins is going to be pretty meaningful we know the pricing in those markets are the best in the world and so we expect youre going to see very nice improvement in our gross margin over the next couple of years.
Thanks again.
Our next question is from the line of Joanne Wuensch with Citi. Please proceed with your questions.
Hey, Good afternoon, guys. This is actually Anthony on for Joanne. Thank you for taking our questions.
My first just on guidance since then.
But some moving pieces with the U S. China. One is just can you just talk about what your.
Our at the low end of guidance versus the high end of guidance and I just had a quick follow up thank you.
Yeah. Thanks for the question you know it is if there were a lot of swing factors for us over the balance of the year, we're thinking about the contribution for me of course, the China approval, which we talked about we're expecting in the fourth quarter and there's a lot of different ways, if the year could unfold.
Generally we're comfortable with the entire range, we provided but but it's just very difficult to pinpoint exactly where it will fall given all these various dynamics at play.
Alright, that's helpful and then I thought.
The sort of information on Spain on the leads to a consultation conversion was interesting do you have any do you know how many of those I think it was 30 patients that sort out then the Appointment's do you know how many actually moved on to get a procedure.
Yes. Thank you what I can tell you is that because it is summer you know many of these potential patients are scheduling either the appointment or the procedure for after the summer break in in Europe and in particular in Spain, They take off the entire amount of.
Just so you know part of what Raj was referring to you know is indicating.
The way we are looking at you know when we think about MEO. We see just amazing initial response that could transform itself into many appointments and potentially procedures. So as that ramps up you know, we expect to see more and more clinics coming in and that's you know what we want to see what the with EMEA launch.
Great. Thank you.
Thank you. Our next question is from the line of Josh Jennings with Cowen and company. Please proceed with your questions.
Good afternoon. Thanks for taking my question just wanted to say and Raj I wanted to start just on onshore plus and.
Hum ergonomics to implant the premium pricing associated with that.
That program in and just.
So you get a better understanding of the momentum. This year in 2023 is there's new countries youre getting approval and launching joy plus.
And the pricing premium associated with that and how you see that ramping over the course of the next 612 24 months.
So as we launch new.
The new exciting experiences like the one we have with joy, which is.
Program.
To promote ergonomics two platform.
What we see is that once.
<unk> I understand the value proposition.
They understand that upgrading to these type of offerings is worth the price premium so you know more than.
10% after market in certain countries has been you know moving to joy for us and that's very important because it tells you that you know what we came into more than a decade ago, which was a commodity market no longer is and we've been able to shape that through technology and through you know the type of value of PREPA.
Patients that joy and bodies. So you know still many countries that we we need to go to with Joy, but I'm definitely Super pleased about it further to that I think it's important to recognize that although we are creating a lot of of you know potential awareness and interest.
With me are some of those patients.
Patients are not suitable for me yeah. So you know joy becomes like the alternative for them that is high quality and you know clothes in the type of experience.
Establishment labs with me I think it is quite positive development for the company. So either the expansion that we see in terms of new entrants to the category with Mia.
Alone or the ones that are you know.
Moving through the consideration face and end up in me, both very positive for us.
Make sure that if I could just sneak one more in <unk> effects impact in the corner of the top line and he can be quantification you provide will be great sorry about that thank you.
Yeah, No problem, Josh It was middle in the quarter, you know not really worth calling out.
Excellent I appreciate it.
Ah next questions from the line of Marie <unk> with P. T I G.
With your questions.
Hey, good afternoon, when I was an Raj this family blown from Marie Thanks for taking the questions. Maybe I can ask my first question here on the Cade into the back half of the year and Roger I. Appreciate your comments in the prepared remarks, but in terms of seasonality here. In Q3, you know is that something we should expect.
Relatively in line with you know 2021 and 2022.
We we do expect seasonality right and I think one thing or Saint probably in our numbers is that the amount of revenue collect your distributors is also increasing rate and so as our distributors start to experience at seasonality as well it becomes even more pronounced in our number. So so we are expecting it's going to show up here in the third.
For the rest of your scene and also.
So we expect you know the dip in the third quarter is probably a bit more for a bit more pronounced than we've seen you know relatively overall cadence of revenue for the year than we've seen in years past.
Okay. That's helpful. I appreciate the comments and maybe just to follow up here on some of the questions out of the the initial span experience for me you know in the password typical breast augmentation, we've heard that it takes anywhere from months to a few years to you know for a patient to decide to go through the procedure, but it sounds like with me that's potentially accelerating.
Some of that conversion just wondering if that was something you think is a phenomenon that may be translatable to the broader market for for me.
Do you think it's one of them was interesting things because you know the consideration face in traditional breast augmentation tends to be around four to eight years. So you know when you look at the group that was not interested in a traditional breast augmentation.
That would signal that their cycle of decision, making is made a lot easier by the fact that you are removing all these obstacles from.
From the decision and I think that's that's absolutely logical and then when you look at the group that was considering a breast augmentation would you see is that you know me a again is getting them through the finish line by removing the obstacles that they were looking at.
My second question.
Thank you.
Our next question is from the line of Neil Chatter G with be rally. Please proceed with your questions.
Yeah, good afternoon, and thanks for taking our questions maybe just sticking with me.
You've touched on a.
Curious how that that kind of initial experience is maybe similar across the other.
European countries, where centers and if not if there's any other anecdotal feedback you've gotten from those centers.
Yeah, I think what we are seeing is that you know dis clinics that have moved from certification to actually launching are getting a lot of interest from potential consumers now do the summer months did get in the middle of.
You know of this but ER I think what we expect is that many of these potential.
Potential consumers once they go and get their consultations, we'll make a decision to go ahead with with me. So you know just to to let you know we have also added another chain of clinics in Japan, you know we've added too high.
Premium come.
Clinics in Germany, and you know we are adding more you know as a as a as the summer progresses. So I think that's really good for us because none.
Essentially filled that interest.
Great and then just just one follow up here for me.
You talked about the kind of <unk>, you know being up.
Commercially and year over year. She was curious you know if there's any any nuances are dynamics to think about you know for the various international regions.
Oh, and you know I think it's you know it's kind of a reflection of a number of things right. I mean, we are it's S. Earlier question noted we're seeing Joy you know start to get more utilization, that's a higher price product for us we've taken a little bit of price and a number of our markets is a reflection of the value.
Bringing with the products that were taken to market and.
So I'd say, it's you know really a combination to begin that mix and that makes your price. We're seeing an overall, we're pretty pleased with how things are progressing there.
Great.
<unk>. Thanks.
Thank you.
Or to ask a question today, you May press Star one.
Next question is from the line of George Sellers Stevens. Please proceed with your questions.
Hey, good afternoon, and thanks for taking my question I apologize if I missed this hopping from a few calls but I was just curious if you could give some color on maybe what you're expecting in terms of contribution that within the guidance from China I'm not sure if you've specifically quantify that.
Obviously that approval, it's been a little bit slower than we'd expected and just curious if that's potential headwind are a risk to the guidance at this point.
[laughter].
Oh, Hey, George you know, we were not going to provide specifics around the the number right to the amount of revenue would expect from China for competitive and other reasons.
Level of confidence in approval. This year was very high we continue to work with our partner in in China in ranch in the last few questions that we have received you know as I noted on earlier question. There's just a number of different ways of a year can play out with the contribution for me with China approval, and so Denver comfortable with the entire range, we've given and it's just really difficult.
To pinpoint where exactly were gonna fall within that.
Okay that that's totally understandable and then maybe switching to me, even though it's 14 partnerships. So far I'm. Just curious how you were thinking about that playing out the rest of this year, what your expectations are and if you're trying to sort of accelerate.
Those partnerships, maybe what gets that or it gets doctors to sign up faster or if this is maybe a a purposeful slower rollout in and sort of picking and choosing the the best partners at this stage.
Yeah.
Oh, absolutely I think what we're trying to do is accelerate the number of premium partner clinics that we bring on board in Europe , and I think you know there's still a lot of space for us to you know to acquire some of those premium partners and also more importantly, we need to.
To train them certify them and get them to launch so I think the importance is that as we move you know through this and month by month, we've been seeing it we learn more and more you know what works in terms of creating awareness and what is most efficient so.
Clinics had come later on will benefit from those learnings.
Okay, great. Thanks for the time again I appreciate it.
Thank you.
All the time, we have for questions today, I'll turn the call back over to one one.
121 Jose.
A squirrel puts as soon as you were calling closing comment.
Thank you for joining us on today's call. We look forward to providing our next quarterly update in November and we wish everyone continued good health and happiness.
Thank you. This will conclude today's conference may disconnect. Your lines at this time and thank you for your participation.