Q2 2024 Edwards Lifesciences Corp Earnings Call

Operator: Greetings, and welcome to the Edwards Lifesciences second quarter 2024 results. At this time, all participants are in a listen-only mode.

Greetings and welcome to the Edwards Lifesciences second quarter 2024 results at this time all participants are in a listen only mode.

Operator: A brief question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. You may be placed into the question queue at any time by pressing star 1 on your telephone keypad.

A brief question and answer session will follow the formal presentation.

Speaker Change: If anyone should require operator assistance during the conference. Please press star zero on your telephone keypad you may be placed into question queue at any time by pressing star one on your telephone keypad. As a reminder, this conference is being recorded.

Operator: As a reminder, this conference is being recorded. It's now my pleasure to introduce your host, Mark Wilterding, Senior Vice President, Investor Relations. Thank you. You may begin.

Speaker Change: It's now my pleasure to introduce your host Mark Walter Tang Senior Vice President of Investor Relations. Thank you you may begin.

Mark Wilterding: Thank you very much, Kevin. Good afternoon, and thank you all for joining us. With me on today's call is our CEO, Bernard Zovighian, and our CFO, Scott Ullem. Also joining us for the Q&A portion of the call will be Larry Wood, our Global President of TAVR and Surgical Structural Heart, Daveen Chopra, our Global Leader of TMTT, Wayne Markowitz, our Global Leader of Surgical Structural Heart, and Katie Szyman, our Global Leader of Critical Just after the close of regular trading, Edwards Lifesciences released its second quarter 2024 financial results.

Speaker Change: Thank you very much Kevin and good afternoon, and thank you all for joining US with me on today's call is our CEO Bernard will begin and our CFO Scott all of them also joining us for the Q&A portion of the call will be Larry Wood, our global President of tower in surgical structural heart Devine Chopra, our global leader of T. M T T Wayne Markowitz our glow.

Mark Wilterding: During today's call, management will discuss those results included in the press release and accompanying financial schedules and then use the remaining time for Q&A. Please note that management will be making forward-looking statements that are based on estimates, assumptions, and projections. These statements include, but are not limited to, financial guidance and expectations for growth opportunities, strategy, leverage, and integration of acquisitions, regulatory approvals, clinical trials, litigation reimbursement, competitive matters, and foreign currency fluctuation.

Speaker Change: The leader of surgical structural heart and kidneys Zyman, our global leader of critical care just after the close of regular trading Edwards Lifesciences released second quarter 2024 financial results. During today's call management will discuss those results included in the press release and accompanying financial schedules and then use the remaining time for Q&A.

Mark Wilterding: Statements speak only as of the date on which they are made, and Edwards does not undertake any obligation to update them afterward. Additionally, the statements involve risks and uncertainties that could cause actual results to differ materially; information concerning factors that could cause these differences and important safety information can be found in the press release, our 2023 annual report on Form 10-K, and Edwards' other SEC filings, all of which are available on the company's website, at www.edwards.com.

Speaker Change: Please note that management will be making forward looking statements that are based on estimates assumptions and projections. These statements include but are not limited to financial guidance and expectations for growth opportunities strategy leverage and integration of acquisitions regulatory approvals clinical trials litigation reimbursement competitive matters.

Speaker Change: And foreign currency fluctuations. These statements speak only as of the date on which they are made and Edwards does not undertake any obligation to update them. After today. Additionally, the statements involve risks and uncertainties that could cause actual results to differ materially information concerning factors that could cause these differences and important safety information can be five.

Speaker Change: And in the press release, our 2023 annual report on Form 10-K, and Edwards' other SEC filings all of which are available on the company's website.

Speaker Change: And Edwards Dot com unless otherwise noted our commentary on sales growth refers to constant currency sales growth, which is defined in our quarterly press release issued earlier today.

Mark Wilterding: Unless otherwise noted, our commentary on sales growth refers to constant currency sales growth, which is defined in the quarterly press release issued earlier today. Reconciliations between GAAP and non-GAAP numbers mentioned during the call are also included in the company's press release.

Speaker Change: Conciliations between GAAP and non-GAAP numbers mentioned during the call are also included in the company's press release with that I'd like to turn the call over to Bernard for his comments.

Mark Wilterding: With that, I'd like to turn the call over to Bernard for his comments. Thank you, Mark, and thank you all for joining us. This afternoon, we issued two press releases, which the team and I will review in more detail with you now. The first, outlining our Q2 results, and the second, highlighting our acquisition of Yenavalve, a pioneer in the transcancer treatment of aortic rehabilitation, or AR, and Endotronix, a leader in heart failure management solutions. I will start with our second quarter performance.

Bernard: You Mark and thank you all for joining us.

Speaker Change: This afternoon, we issued two press releases, which should have a team and I will review in more detail with you know.

Speaker Change: The theft outlining our Q2 results.

Speaker Change: And the second highlighting our acquisition of <unk>, a pioneer in the trust to get at the treatment of aortic regurgitation or at all and it looks funny.

Speaker Change: Read Huck video management solutions.

Bernard J. Zovighian: The total company sales of $1.6 billion increased 8%, on a constant currency basis, versus the year-ago period. In addition, we made important advancements in our clinical research, new product introductions, and efforts by Edwards employees to address the unmet needs of many more patients around the world. Tavern growth in the second quarter was lower than expected.

Speaker Change: I would stop with our second quarter performance.

Speaker Change: Total company sales of $1 $6 billion increased 8% on a constant currency basis versus the year ago period.

Speaker Change: In addition, we made important advancements in our clinical research new product introductions and if false by at all its employees to address the unmet needs of many more patients around the world.

Speaker Change: How does that roll off in the second quarter was lower than expected yet we are pleased with the increasingly significant contribution from TNT T.

Bernard J. Zovighian: Yet, we are pleased with the increasingly significant contribution from TMT. Our vision for TMT is becoming a reality, and our strategic commitment has developed into a growth portfolio of differentiated technologies. Overall, Edwards has been well positioned to deliver strong, sustainable growth. We also announced this afternoon two acquisitions: Yenaval and Endotronic. We have known this company for many years. Discussions with the company have been ongoing for some time, and the timing of these acquisitions coincided with earnings. We are pleased to expand into new areas. Two New Structural Heart Therapeutic Areas, AR, and Heart Failure.

Speaker Change: Our vision for T MTT is becoming a reality.

Speaker Change: Our strategic commitment is developed into our growth portfolio of differentiated technology.

Speaker Change: Overall, it also have been and well positioned to deliver strong sustainable growth.

Speaker Change: We also announced this afternoon two acquisition yen evolve that and look funny, we have known this company for many years discussions with the companies have been ongoing for some time and the timing of these acquisitions coincide with earnings.

Speaker Change: We are pleased to expand into news.

Speaker Change: Two new structural heart therapeutic areas.

Bernard J. Zovighian: And we will leverage our innovation capability, with world-class science and clinical evidence, to ensure accelerated access to life-saving technologies for patients around the world. Now, I will provide some additional details on Q2 results by Product Group in Tavern. Second quarter global sales of $1.04 billion increased 6% year-over-year, lower than we planned.

Speaker Change: <unk> and heart failure, and we leverage our innovation capabilities with a world class science and clinical evidence to ensure accelerated access to life saving technologies for patients around the world.

Speaker Change: Now I will provide some additional details on Q2 results by product group.

Speaker Change: In tablet.

Speaker Change: Second quarter global sales of one 4 billion.

Speaker Change: <unk>, 6% year over year lower than we planned.

Bernard J. Zovighian: Edwards' competitive position did not meaningfully change globally, although we experienced some regional pressure and maintained prices. We are confident in our differentiated technology, high-quality evidence, and the value we continue to demonstrate to patients, clinicians, and the healthcare system. We remain focused on continuing our deep commitment to advancing evidence for AS patients. At the New York Valve meeting in June, we presented additional analyses from the Parler trial, which demonstrated excellent clinical outcomes up to five years in women and patients with small anilines.

Speaker Change: It was competitive position did not meaningfully change globally, although we experienced some regional pressure and we maintain pricing.

Speaker Change: We are confident in our differentiated technology high quality evidence and the value we continue to demonstrate the patients clinicians and the healthcare system.

Speaker Change: We remain focused on continuing our deep commitment to advancing evidence for E S patient.

Speaker Change: At the New York valve meeting in June we presented additional analyses from the powering of trials, which demonstrated excellent clinical outcome at two five yale's in women and patient with small annualized.

Bernard J. Zovighian: Adding to the global body of evidence on the platform, we also anticipate additional data from the RIA study, a prospective randomized study in more than 400 patients across 35 sites in Europe, comparing the safety and efficacy of TAVR versus surgery in women with severe symptomatic aortic stenosis.

Speaker Change: Adding to the global body of evidence on the platform. We also anticipate additional data from the study to be presented at the upcoming U S. C meeting in London.

Speaker Change: Korea is a prospective randomized study in more than 400 patients across 35 sites in Europe, comparing the safety and efficacy of Teva versus sell jewelry in women with severe symptomatic aortic stenosis.

Bernard J. Zovighian: We are actively pursuing significant opportunities to grow TAVR globally over the long term and are proud to continue our deep commitment to advancing science for aortic stenosis patients through the progress and early TAVR trials, which could fundamentally change how AS patients are treated. Early Tavern Trial results will be presented at TCTV. And we believe, if the data are compelling, it could have a meaningful impact on the timing of patient treatment, while also streamlining referral and patient care for all severe AS patients. In the U.S., our year-over-year second-quarter TAVR sales growth was slightly below our global constant currency growth, but we believe our U.S. competitive position was largely unchanged. In the second quarter, U.S. Taver sales grew slower than expected.

Speaker Change: We are actively pursuing significant opportunity to grow globally or they have a long tail and are proud to continue our deep commitment to advancing science for aortic stenosis patients for all the progress and early testing of fryers, which could fundamentally change how a S. P.

Speaker Change: They're treated.

Speaker Change: Let me tell you a trial results will be presented at TCT. This year and we believe if the data compelling it could have a meaningful impact on the timing for patient treatment.

Speaker Change: While also seem like anything or I felt I didnt patient care for all C V. A S patient.

Speaker Change: In the U S. Our year over year second quarter sales growth was slightly below our global constant currency growth rate, we believe our U S competitive position was largely unchanged.

Speaker Change: Second quarter U S sales grew slower than expected.

Bernard J. Zovighian: The continued growth and expansion of structural heart therapies, including newly-approved tricuspid therapies and other fast-growing structural heart therapies, put pressure on hospital workflows, Wish Impacted Tavern. These pressures were also observed in the recent spike in emergent TAVR cases as reflected in claims data. As centers adopt these new therapies, and they become part of their standard processes, we expect this will stabilize. We know from experience that hospitals have historically demonstrated the ability to scale to support trans-catheter procedure growth over time. However, we believe significant under-treatment of severe AS persists.

Speaker Change: The continued growth and expansion.

Speaker Change: Talk to you in hot therapies, including newly approved tricuspid therapies and all the fast growing structural heart therapies put pressure on hospital work flows we shouldn't bhakti tougher.

Speaker Change: These pressures were also observed in the recent spike in Belgium, caveat cases as reflected in claims data.

Speaker Change: Centel's adopt to these new therapies and they become part of it.

Speaker Change: Offices, we expect this will stabilize.

Speaker Change: We know from experience that the hospital have Easter equally demonstrated the ability to scan to support probably scarcity of procedure growth all the time.

Speaker Change: We believe significant under treatment of C V. A S persist evidence demonstrates that are larger than they are in system patients currently go untreated.

Bernard J. Zovighian: Evidence demonstrates that a large number of in-system patients currently go untreated. We are accelerating our efforts to improve referrals and treatment rates for patients already in the hospital system who are suffering from severe symptomatic aortic stenosis. We recently launched the Edwards-ENACT patient activation program, which leverages a comprehensive cardiovascular AI platform and world-class support to bring real-time insights to TAVR programs and improve the quality of care for patients. This first-of-its-kind program is focused on streamlining the identification, evaluation, and treatment of severe aortic stenosis patients within the hospital system. Outside of the US, in the second quarter, our constant currency TAFIR sales growth was slightly above our global TAFIR growth. In Japan, we generated double-digit self-growth driven by sapient-free ultra-resilience.

Speaker Change: We are accelerating our false to improve I felt and put them in the right for patient already in the hospital system, well suffering from severe symptomatic aortic stenosis.

Speaker Change: We recently launched the EDA world enact patient activation program, which leverage our comprehensive cardiovascular our AI platform and world class support to bring real time insights to tidy up programs and improve our quality of care for patients.

Speaker Change: This first of its kind program is focused on streamlining, but yet you don't see vacation evaluation and treatment of severe aortic stenosis patients within the hospital system.

Speaker Change: Outside of the U S. In the second quarter, Oh, Oh constant currency sales growth was slightly above our global type of outgrowth in Japan, we generated double digit sales growth driven by SAPIEN three ultra resilience, we continue to focus on expanding the ability of these.

Bernard J. Zovighian: We continue to focus on expanding the ability of this therapy and believe AS remains a significant under-treated disease among the substantial elderly population in Japan and in Europe. While share is down slightly on an annualized basis, we were pleased with the momentum driven by the launch of Sapien III Ultra Resilient. We are pleased with the high procedure success rate and exceptional patient outcomes. We expect the momentum to continue to build as more centers have experience with the first-choice valve for lifetime management.

Therapy, and believe and remain a significant and dealt with the disease.

Speaker Change: The substantial Italy population in Japan.

Speaker Change: In Europe.

Speaker Change: Why is share is down slightly on an annualized basis. We are pleased with our momentum driven by the launch of SAPIEN three ultra resilient we.

Speaker Change: We are pleased with high procedural success rate and exceptional patient outcome.

Speaker Change: We expect the momentum to continue to build as more centers I have experience with the first choice vials for life than management, Inc.

Bernard J. Zovighian: In closing, we now anticipate second-half TAVR sales growth similar to the first-half year-over-year growth rate, a 5-7% full-year growth rate versus previously guidance of 8-10%. These equate to full-year global traversals of $4 billion to $4.2 billion.

Speaker Change: In closing, we now anticipate second half sales growth similar to the first half year over year growth rate of 5% to 7% full year growth rate.

Speaker Change: As previously guidance of 8% to 10%.

Speaker Change: This equates to 40 year global sales of $4 billion to four 2 billion.

Bernard J. Zovighian: We believe hospitals are motivated to continue scaling to accommodate an increasing volume of trans-catheter procedures, which will bring tremendous value to patients and the healthcare system. We remain confident that Edwards' position for healthy and sustainable growth is driven by our differentiated TAVR portfolio, our Deep Commitment to Advancing Patient Care for High-Quality Clinical Evidence and New Indications and our investment in Patient Activation Initiatives. Turning to TNTT, Our deep structural heart expertise has enabled us to significantly advance our portfolio of differentiated technologies, including the Pasquale repair system, the EVOC tracker speed replacement, and the Sapien End Free Mitral Replacement.

Speaker Change: We believe hospital all motivated to continue scaling to accommodate inquiries zinc volume of trying to get at your pro cereals, which would bring three amend its value to patient.

Speaker Change: And the health care system.

Speaker Change: We remain confident that it was his position for healthy and sustainable type of growth driven by our differentiated portfolio.

Speaker Change: Our deep commitment to advancing patient care through high quality clean clinical evidence and new indications and our investment in patient activation initiatives.

Speaker Change: Turning to T N T T O.

Speaker Change: Oh deep structural heart expertise enable us to significantly advance our portfolio of differentiated technology, including the Pascal repair system, the evoke tricuspid replacement system, and the CPA and free mitral replacement system.

Bernard J. Zovighian: Our exciting pipeline of innovations is addressing the large unmet needs for patients with mitral and tracheal speed disease. In Q2, we achieved positive results with sales of $83 million, representing a 75% increase versus the prior year. Q2 sales were led by Pascal Globally, an early commercial introduction of eVogue in the US and Europe.

Speaker Change: Our exciting pipeline of innovations is addressing the large unmet needs for patients with mitral and tricuspid disease.

Speaker Change: In Q2, we achieved positive results with sales of 83 million, representing a 75% increase versus the prior year on year.

Speaker Change: Q2 sales were led by Pascal globally, and early kind of shut in production of evoke and the U S and Europe.

Bernard J. Zovighian: Pascal Adoption is growing, reflecting its premium differentiation and the value it brings to physicians and patients. We believe the micro tier market continues to grow double-digitally in both the U.S. and Europe. We are excited to bring this therapy to more geographies, more physicians, and more patients. We evoke commercial launch, and continue to progress well. Our discipline strategy is focused on outstanding patient outcomes in centers investing resources required to grow a successful tricuspid program.

Speaker Change: Pascal adoption is growing.

Speaker Change: I think it's premium differentiation and the value it brings to physician and patient.

Speaker Change: We believe a mitral tier market continues to grow double digit in both the U S and Europe.

Speaker Change: We are excited to bring this therapy to more geographies more physicians and more patient.

Speaker Change: The evoke commercial launch continues to progress well Oh discipline strategy is focused on outstanding patient outcome incentives investing resources required to grow our successful practice feed program.

Bernard J. Zovighian: We are now opening new centers, both in Europe and the U.S., after having started with a clinical trial site. We continue to see strong interest in the therapy, which reflects the significant unmet need in this population of patients who have few options for treatment. Our early real-world commercial experience has demonstrated excellent clinical results, consistent with those from the TRICEN2 trial.

Speaker Change: We are now opening new centers, both in Europe, and the U S. After having started with our clinical trial sites. We continue to see strong interest in the therapy, which reflects the significant unmet need in this population of patient who have few options for treatment.

Speaker Change: Well early real World commercial experience has demonstrated excellent clinical results.

Speaker Change: Consistence with volt weight from the pricing to try and win.

Bernard J. Zovighian: We look forward to presenting the full cohort of TraceM2 data at the TCT conference in October. Last month, CMS announced the opening of a national coverage analysis for transcatheter tricuspid valve replacement. Since Evoque was granted FDA breakthrough status and is utilizing the CMS Parallel Review process, we believe. CMS can move quickly to finalize national coverage. SAPIEN M3 remains on track to be our first Transcatheter Mitral Valve Replacement Therapy to gain regulatory approval and launch around the world.

Speaker Change: We look forward to presenting the full cost of placing two data at the TCT conference in October.

Speaker Change: Last month.

Speaker Change: <unk> announced the opening of a national coverage analysis for Transcatheter tricuspid valve replacement.

Since evoke was granted FDA breakthrough status and is utilizing the CMS parallel review process. We believe CMS can move quickly to finalized national coverage.

Speaker Change: Sipping in free rent.

Speaker Change: I mean, some frac to be a first trust get to tell mitral valve replacement therapy to get regulatory approval and launch around the world.

Bernard J. Zovighian: We are also pleased to have received a breakthrough designation from the FDA, and we completed enrollment in the Mitral Analyst Classification, or MAC, arm of our Encircled Study. We now expect SAPIEN M3 to receive CMARC earlier than previously expected by mid-2025, with FDA approval in the U.S. to follow in 2026.

Speaker Change: We are also pleased to have received breakthrough designation from the FDA and we completed enrollment in <unk>.

Speaker Change: Mitral annulus calcification of Mac.

Speaker Change: And the second study.

Eddie: We now expect SAPIEN in Frito received FEMA, Eddie how are you.

Eddie: Rather than previously expected by mid 2025 with FDA approval in the U S to follow in 2026.

Bernard J. Zovighian: Earlier this month, we announced the acquisition of Innoval. Innovative early-stage technology will add to our growing pipeline of innovative therapy in TNT, and we expect to close the acquisition later this year. We further expect that innovative technology, combined with Edwards' expertise in mitral disease, will enhance the company's TMVR technologies to address large, unmet structural heart patient needs and support sustainable long-term growth. Based on the first half 2024 momentum and the ongoing global adoption of our differentiated technology, PASCAL and EVOC, we are increasing full-year sales guidance for TMT to the higher end of our previous guidance of 320 to 340 million euros We remain confident that our unique portfolio strategy, with repair and replacement therapies for both mitral and tricuspid disease, will offer clinicians the broadest set of options needed to treat this complex underserved patient.

Speaker Change: But what are you all these balls, we announced the acquisition of you know valve you know a lot of early stage technology will add to our growing pipeline of innovative therapies and TNT T and we expect to close the acquisition later this year.

Speaker Change: We felt that I expect that you know about a technology combined with <unk> expertise in mitral disease will enhance the company T. N V of technologies to address large unmet structural heart patient needs and support sustainable long term golf.

Speaker Change: Based on the first half 'twenty 'twenty four momentum and the ongoing global adoption of our differentiated technology Pascal evoke we are increasing full year sales guidance for TNT tea to the higher end of our previous.

Speaker Change: 322 $440 million range.

Speaker Change: We remain confident that our unique portfolio strategy with repair and replacement therapies for both mitral and tricuspid disease with tradition, a boarder set of options needed to treat with complex and you'll see a patient.

Bernard J. Zovighian: The advancement of our long-term TMTT strategy has positioned us for strong... sustainable growth over many years, driven by a growing portfolio of innovative therapies. For Surgical Structural Heart, second quarter sales of $264 million increased 5% over the prior year.

Speaker Change: That's been sort of a long term TMT strategy has positioned us for strong sustainable growth over many years driven by our growing portfolio of innovative therapies.

Speaker Change: In surgical structural heart.

Speaker Change: Second quarter sales of $264 million increase 5% per year.

Bernard J. Zovighian: Growth was driven by strong global adoption of Edwards' premium surgical technologies in SPIRIS, MITRESS, and CONNECT. We continue to see positive procedure growth globally for the many patients best treated surgically, including those undergoing complex procedures. We continue to expand the overall body of Resilient Evidence and have completed enrollment in the U.S. and Canada for a momentous critical trial studying Resilient Performance in the Michael position. My Swiss adoption in Europe is ramping up, and we are pleased to have been granted reimbursement for the device in France earlier than expected.

Speaker Change: Growth was driven by strong global adoption of Nols premiums surgical technologies in spirits, My friends and connect.

We continue to see positive procedural growth globally for the many patients best twitching surgically and Craig volt, and they'll go and complex for cereals.

Speaker Change: We continue to expand the overall body of reasonably evidence and have completed enrollment in the U S and Canada for a moment as critical trial studying resilient performance in the mitral position.

Speaker Change: Swiss adoption in Europe is ramping up and we are pleased to have been granted reimbursement for the device in France earlier than expected.

Bernard J. Zovighian: In summary, we remain confident that our full year 2024 surgical sales will be 6 to 8%, driven by continued adoption of our Resilia portfolio and growth in overall heart valve surgery in critical care. Second quarter sales were $246 million, which increased 7% versus the prior year.

Speaker Change: In summary, we remain confident that our 40 year 'twenty 'twenty four surgical centers would it be 6% to 8% driven by continued adoption of our resilient portfolio and growth in overall heart valve surgery.

Speaker Change: In critical care second quarter sales were 246 million.

Speaker Change: Which increased 7% versus the prior year.

Bernard J. Zovighian: Growth was led by our pressure monitoring devices using the ICU, with strong contribution from our smart recovery technologies, including the Acumen IQ sensor. Demand was also strong for Swansgan's category. Critical Care remains focused on driving growth through smart recovery and smart expansion, which are designed to help clinicians make more informed decisions and get patients home to their families fast. Since announcing the sale of Critical Care to Becton Dickinson in June, our team has made significant progress, and we plan to close by late Q3. I want to thank all of them for their hard work and dedication.

Speaker Change: Growth was led by our pressure monitoring devices used in the ICU with strong contribution from our smart recovery technologies, including the accumulate your sensor the.

Speaker Change: <unk> was also strong for our fronts gun Scottsdale Cree.

Speaker Change: Critical care remains focused on driving growth through smart recovery and smart expansion, which are designed to add conditions.

Speaker Change: More informed decision.

Speaker Change: And get patients home to their family faster.

Speaker Change: Since announcing the sales of quick you've gotta kept becton Dickinson in June.

Speaker Change: Team has made significant progress and we plan to close by led by late Q free eye.

Speaker Change: I want to thank all of them for their hard work and dedication.

Bernard J. Zovighian: Turning now to the Strategic Acquisition of Yen HaVar Venen. These acquisitions provide an expanded product portfolio in new therapeutic areas to address the unmet needs of AR and heart failure patients around the world. Furthermore, the acquisitions reflect our deep commitment to advancing patient care through our unique strategy and reinforce our confidence in Edwards' sustainable long-term success. Starting with Yelavalv, a pioneer in the transcatheter treatment of RA, a deadly disease that impacts more than 100,000 patients in the U.S. alone and is largely untweeted today. Edwards anticipates U.S. FDA approval of the Jena valve trilogy heart valve system in late 2025, which will represent the first approved therapy for patients suffering from RA.

Speaker Change: Turning down Superstar does your acquisition of yet I've only been in those fronts.

Speaker Change: These acquisitions provide an expanded opportunity in new therapeutic areas to address the unmet needs of E R and heart failure patients around the world.

Speaker Change: How about more the acquisition to reflect our deep commitment to advancing patient care through our unique strategy and reinforce our confidence in Edward sustainable long term growth.

Speaker Change: Starting with others.

Speaker Change: Pioneer in the Transcatheter treatment of a all but deadly disease that impacts more than 100000 patients in the U S alone.

Speaker Change: And it's largely and treated today.

Speaker Change: And all of the anticipated U S. FDA approval of a yellow valve prelude heart valve system in late 2025.

Speaker Change: Which will represent the first approved therapy for patients who.

Speaker Change: Suffering from Yale.

Bernard J. Zovighian: Edward will invest to accelerate the development of this novel technology to enable earlier patient access. As the pioneers in valve innovation, we believe we are best positioned to lead this next frontier of aortic valve disease treatment. We expect this to be the beginning of a long-term iterative strategy. Similar to Tavern, Turning to endotronics.

Speaker Change: And while we invest to accelerate development of this novel technology to enable patient access.

Speaker Change: Pioneers involve innovation, we believe we are best positioned to leave to lead. This next frontier of aortic valve disease treatment.

Speaker Change: We expect this to be the beginning of a long term iterative strategy similar to tap them.

Speaker Change: Turning to Endotronics. It was amazed made its first investment in the company in 2016.

Bernard J. Zovighian: Edwards made its first investment in the company in 2016, so we are very familiar with the technology, the opportunity, and the employees. Many structural heart patients and what serves today also suffer from heart failure with limited options. This acquisition will expand Edwards' structural heart portfolio into a new therapeutic area to address the large, unmet needs of patients suffering from heart failure, which we believe has a significant long-term growth opportunity. Last month, Endotronics received FDA approval for Cordella, an implantable pulmonary artery pressure sensor that directly measures the leading indicator of congestion following the publication of the successful U.S. pivotal trial.

Speaker Change: So we are very familiar with the technology the opportunity and the employees more.

Speaker Change: Many structural heart patients and wealth sales today also suffer from heart failure with limited options VSAT.

Speaker Change: This acquisition will expand and do all sorts of in house portfolio into a new therapeutic area to address large unmet needs of patients suffering suffering from heart failure.

Speaker Change: Which we believe is a significant long term growth opportunity.

Speaker Change: Last month, Endotronics received FDA approval for Castilla and implantable preliminary pressure sensor that directly measure.

Speaker Change: The leading indicator of congestion following the publication of the successful U S pivotal trial.

Bernard J. Zovighian: We are pleased to announce that you have been elected President of the United States of America, and we look forward to entering the structural heart therapeutic area with innovation, world-class science, and clinical evidence to provide access to life-saving technologies for patients around the world.

Speaker Change: We are pleased to until he has talked to you and heartfelt teak area with innovation World Class Science and clinical evidence to provide access to life saving technologies for patients around the world.

Bernard J. Zovighian: We anticipate this investment will strengthen its leadership in structural health innovation and represent long-term growth opportunities. Minimum Revenue Contribution from Yenavar Venture Neutronics is expected to begin late in 2021. As you know, we have a lot of positive momentum and many catalysts across our core businesses, TAVR, CMTT, and Surgical, combined with opportunities to reach new patient populations. And now, I will turn the call over to you, on quarter total company sales performance, where Calvert sales growth came in below our expectations. However, it's important to understand the broader context. We are pleased that TMTT continues to outperform our expectations. And overall underlying sales growth, including critical care, was nearly 8%. Adjusted EPS was 76%.

Speaker Change: We anticipate this investment will friend fan, it's its leadership in sort of in house vision and present long term growth opportunity.

Speaker Change: Minimal revenue contribution from you and I have ever been with products is expected to begin late in 2025.

Speaker Change: As you can tell we have a lot of positive momentum and many catalyst across our core businesses Teva She had.

Speaker Change: T T cells you could.

Speaker Change: Combined with opportunities to reach new patient population and now I would tell the call over to Scott.

[noise] quarter total company sales performance, where caliber sales growth came in below our expectations How's.

Scott: However, it's important to understand in broader context, we were pleased that T. M. D. T continues to outperform our expectations and overall underlying sales growth, including critical care was nearly 8% adjusted EPS was <unk> 70 cents.

Scott B. Ullem: GAAP earnings per share of $0.61 included one-time separation expenses related to the sale of critical care. A full reconciliation between our GAAP and Adjusted Earnings-for-Share is included with today's results. Now I'll cover additional details of our P&L, which reflect total company results, including critical care. Note that critical care will be presented as a discontinued operation. As we noted in the press release, we'll provide Q4 2024 information reflecting the sale of critical care and the acquisitions announced this month when we report the third quarter. For the second quarter, our adjusted gross profit margin was 77.1% compared to 77.7% in the same period last year.

Speaker Change: GAAP earnings per share of <unk> 61 cents included one time separation expenses related to the sale of critical care.

Speaker Change: A full reconciliation between our GAAP and adjusted earnings per share is included with today's release. So now I'll cover additional details of our P&L, which reflect total company results, including critical care.

Speaker Change: Note the critical care will be presented as a discontinued operation and the 10-Q, we will file next week.

Speaker Change: As we noted in the press release, we will provide Q4 'twenty 'twenty four information, reflecting the sale of critical care and the acquisitions announced this month when we report third quarter results.

Speaker Change: For the second quarter, our adjusted gross profit margin was 77, 1% compared to 77.7% in the same period last year.

Scott B. Ullem: Last year's second quarter gross profit margin benefited from a more favorable impact from foreign exchange. We expect Edwards' Q3 Adjusted Gross Profit Margin, including critical, to be in line with Q2, driven by high value technologies that yield strong gross profit.

Speaker Change: Last year's second quarter gross profit margin benefited from a more favorable impact from foreign exchange rates.

Speaker Change: We expect Edwards Q3, adjusted gross profit margin, including critical care to be in line with Q2, driven by high value technologies that yield strong gross profit margins.

Scott B. Ullem: Suggested selling, general, and administrative expenses in the quarter were $509 million, or 31.2% of sales compared to $469 million in the prior. This increase was driven by an expansion of field-based We support growth of our transcatheter therapy, including the launch and rollout of Pascal and Evoque. Adjusted research and development expenses in the second quarter grew 12% over the prior year to $303 million, or $18.6. This increase was primarily the result of continued investments in our Transcather valve, including increased clinical trial.

Speaker Change: Adjusted selling general and administrative expenses in the quarter were $509 million or 31.2% of sales compared to $469 million in the prior year.

Speaker Change: This increase was driven by an expansion of field based personnel to support growth of our transcatheter therapies, including the launch and rollout of Pascal in evoke.

Speaker Change: Adjusted Research and development expenses in the second quarter grew 12% over the prior year to $303 million or 18, 6% of sales.

Speaker Change: This increase was primarily the result of continued investments in our transcatheter valve innovations, including increased clinical trial activity.

Scott B. Ullem: Turning to taxes, our reported tax rate this quarter was 5.2%, or adjusted to 8.4%. Our unusually favorable non-GAAP rate in the second quarter reflects several positive one-time items. This unexpected favorability in our tax rate benefited earnings per share by four cents; foreign exchange rates decreased second quarter adjusted sales growth by 120 basis points, $17.6 million compared to the prior year. FX rates negatively impacted our second quarter adjusted gross profit margin by 60% compared to last year. Free cash flow for the second quarter was reduced $47 million for payments associated with special activities relating to the separation. Excluding the impact of these items, adjusted free cash flow was $333 million.

Speaker Change: Turning to taxes, our reported tax rate this quarter was 5.2% or adjusted eight 4%.

Speaker Change: Our unusually favorable non-GAAP rate in the second quarter reflects several positive one time items that were recorded during the quarter. This.

Speaker Change: Expected favorability in our tax rate benefited earnings per share by four cents in the second quarter.

Speaker Change: Foreign exchange rates decreased second quarter, adjusted sales growth by 120 basis points or $17.6 million compared to the prior year.

Speaker Change: FX rates negatively impacted our second quarter adjusted gross profit margin by 60 basis points compared to last year's second quarter.

Speaker Change: Free cash flow for the second quarter was reduced $47 million for payments associated with special activities relating to the separation of critical care.

Speaker Change: Excluding the impact of these items adjusted free cash flow was $333 million.

Scott B. Ullem: First half adjusted free cash flow was $539,000. We expect to receive cash from the sale of critical care in the, Turning to the balance. We continue to maintain a strong and flexible balance sheet with approximately $2 billion in cash, cash equivalents, and short-term investments as of, Now I'll finish this update with comments about our previously announced sale of critical care as well as guidance relating to our, We announced on June 3rd that Edwards entered into an agreement to sell critical care to BD, and we are planning to close the sale late in the third During the second quarter, we recorded $80 million of one-time costs associated, Additional one-time costs will be incurred throughout.

Speaker Change: First half adjusted free cash flow was $539 million, we expect to receive cash from the sale of critical care in the third quarter.

Speaker Change: Turning to the balance sheet, we continue to maintain a strong and flexible balance sheet with approximately $2 billion in cash cash equivalents and short term investments as of June 30.

Speaker Change: And now I'll finish this update with comments about our previously announced sale of critical care as well as guidance relating to our acquisition announcements.

Speaker Change: We announced on June 3rd that Edwards entered into an agreement to sell critical care to be D.

Speaker Change: And we are planning to close the sale late in the third quarter.

Speaker Change: During the second quarter, we recorded $80 million of one time costs associated with the sale.

Speaker Change: Additional one time costs will be incurred throughout 2024.

Scott B. Ullem: We expect Q3 sales, including the assumption that we own Critical Care for the full quarter, 1.5 to $1.64 billion. Q3 Earnings Per Share of $67 to $78, We do not expect the recently announced acquisitions to contribute to Edwards' sales. We intend to provide fourth-quarter guidance reflecting the sale of Critical Care and the acquisitions announced.

Speaker Change: We expect Q3 sales, including the assumption that we own critical care for the full quarter of $1.56 billion to $1.64 billion and Q3 earnings per share of <unk> 67 to 71 cents.

Speaker Change: We do not expect the recently announced acquisitions to contribute to Edward's sales in 2024.

Speaker Change: We intend to provide fourth quarter guidance, reflecting the sale of critical care and the acquisitions announced this month when third quarter results are reported in October.

Scott B. Ullem: Third quarter results are reported on. We will also provide 2025 guidance at our Investor Conference in New York in December. In the meantime, I'll share a few early expectations for 2025. Next year we expect minimal revenue from acquisitions.

Speaker Change: We will also provide 2025 guidance at our Investor Conference in New York on December 4th.

Speaker Change: In the meantime, I'll share a few early expectations for 2025.

Speaker Change: Next year, we expect minimal revenue from acquisitions, while we were planning on incremental operating expenses from these early stage companies, partially offset by operational efficiencies we plan to realize following the sale of critical care.

Scott B. Ullem: While we are planning on incremental operating profits from these early stage companies, partially offset by operational efficiencies we plan to realize following the sale of critical care, we do not expect increased operating profits. We are planning healthy, long-term profits from the sale of critical care in 2025. In addition, we plan to maintain a strong balance sheet.

Speaker Change: We do not expect increased operating efficiencies to completely offset the loss of profits from the sale of critical care in 2025, but we are planning healthy long term profit growth.

Speaker Change: In addition, we plan to maintain a strong balance sheet to support continued internal and external investments as well as opportunistic share repurchase.

Scott B. Ullem: Continued Internal and External Investments, as well as Opportunistic Share, Most importantly, we are confident in the moves we have made to reshape our portfolio of technologies to focus specifically on structure. The sale of critical care provides extra management bandwidth, as well as additional liquidity to fund external growth. At the same time, our original vision for TMTT is becoming a reality. The early-stage investments we made in companies like Innovalve and Endotronics positioned us to acquire high-quality and high-potential businesses with talented employees.

Speaker Change: Most importantly, we are confident in the moves we've made to reshape our portfolio of technologies to focus specifically on structural heart.

Speaker Change: The sale of critical care provides extra management bandwidth as well as additional liquidity to fund external growth investments.

Speaker Change: And at the same time, our original vision for T. M. G. T is becoming a reality in the early stage investments we made in companies like in a valve in endotronics position us to acquire high quality and high potential businesses with talented employees.

Scott B. Ullem: We have other jewels in our portfolio of internal and external investments that will benefit Edwards in the years ahead. For the long term, I see an exciting future with expanded opportunities and large and growing markets, which we believe will result in sustainable, double-digit revenue and earnings. So with that, I'll pass it back.

We have other jewels in our portfolio of internal and external investments that will benefit Edwards in the years ahead.

Speaker Change: Over the long term, we see an exciting future with expanded opportunities in large and growing markets, which we believe will result in sustainable double digit revenue and earnings per share growth.

Speaker Change: So with that I'll pass it back to Bernard Thank you Scott So let me share a few closing thoughts.

Bernard J. Zovighian: Thank you, Scott. So let me share a few closing thoughts in Taver. We have significant opportunities, and we are committed. Growing Globally by Advancing Science over Voluntary.

Bernard: And in Teva.

Bernard: We have significant opportunities and we are committed to growing globally.

Speaker Change: Advancing science saga, along to progress and early Teva fryers could fundamentally change how a S patient off with it.

Bernard J. Zovighian: Progress and early TAVR trials could fundamentally change our AS patient outcomes in TNTT. Our deep expertise has enabled us to significantly advance our exciting portfolio of innovation and our long-term TNTT strategy as positioners for strong... Sustainable Growth Over Many Years in the Surgical Structural Heart

Speaker Change: In T N T T O.

<unk> deep expertise enable us to significantly advance our exciting portfolio of innovation.

Speaker Change: And our long term TMT TMT strategy is positioning us for strong sustainable growth over many years.

Speaker Change: It sounds like I, just talked to like the heart, we continue to see stronger adoption of our premium surgical technologies.

Bernard J. Zovighian: We continue to see strong global adoption of our premium surgical technology, and the Indotronics Acquisition provides an extended opportunity in the New Therapeutic Area. They both represent significant long-term opportunities... We remain confident that our innovative therapy will allow adults to treat more patients around the world and continue to drive strong organic growth in the years to come. As patients and clinicians increasingly recognize the significant benefit of Transcantiter-based technology, we remain as optimistic as ever about the long-term growth of our Thank you, Bernard.

Speaker Change: Oh, well, yeah, when endotronics acquisitions provide an expanded opportunity in new therapeutic areas. The Baltimore presents significant long term opportunities.

Speaker Change: We remain confident that our innovative therapy will allow edibles to treat more patients around the world and continue to drive strong organic growth in the years to come.

Speaker Change: Ah patients and clinicians increasingly recognize the significant benefits.

Speaker Change: Off.

Speaker Change: Transcatheter based technology, we remain we remain as optimistic as ever about the long term growth opportunity.

Speaker Change: With that I'll turn it back to Mark.

Mark Wilterding: We're ready to take questions now. In order to allow for broad participation, we ask that you please limit the number of questions to one plus one follow-up. If you have additional questions, please re-enter the queue, and management will answer as many participants as possible during the remainder of the call. Kevin, please go ahead with additional details on accessing the Q&A portion of the call. Certainly, if you'd like to be placed in the question queue, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two if you'd like to remove your question from the queue.

Mark: Thank you Bernard ready to take questions now in order to allow for broad participation. We ask that you. Please limit the number of questions to one plus one follow up if you have additional questions. Please reenter the queue and management will answer as many participants as possible during the remainder of the call. Kevin. Please go ahead with additional details on accessing the Q&A portion of the call.

Speaker Change: Certainly if you'd like to be placed in the question queue. Please press star one on your telephone keypad, a confirmation tone will indicate your line is in the question queue.

Speaker Change: Press Star two if you like to move or questions from the queue.

Operator: For participants using speaker equipment, it may be necessary to pick up your handset before pressing star 1. One moment, please, while we pull for questions. And, as a reminder, please ask one question and one follow-up. Our first question is coming from Larry Biegelsen from Wells Fargo. Your line is now live. Hey guys, good afternoon. Thanks for taking the questions. Two for me.

Speaker Change: For participants using speaker equipment, it may be necessary to pick up your handset before pressing star one one moment. Please while we poll for questions. As a reminder, please ask one question and one follow up our first question is coming from Larry Nicholson from Wells Fargo. Your line is our lives.

Lawrence H. Biegelsen: Let me start with early TAVR, and then I had a follow-up for Scott in 2025. So, for early TAVR, what would be compelling to you, you know? Do you need to show a mortality benefit to be more compelling? And how should we think about the impact on your TAVR growth? If the study is positive, do you expect it to accelerate the TAVR growth in 2025, above the five to 7% you expect this year? Sure. Hey, Larry. This is Larry.

Larry Nicholson: Hey, guys. Good afternoon, thanks for taking the question.

Larry Nicholson: Two for me, let me, let me start with the early <unk> and then I had a follow up for Scott on 2025.

Speaker Change: So what would be for our early type of what would be compelling to you you know do you need to show a mortality benefit.

Speaker Change: Even more compelling in and how should we think about the impact on your tablet growth. If the study is positive do you expect it to accelerate the type of growth in 2025 above the 5% to 7% you expect this year and I had one follow up.

Larry L. Wood: Thanks for your question. I think at a very high level, there needs to be a compelling story for why early intervention is better and basically make the case against watchful waiting. And, you know, we did a lot of work when we were driving the trial, and, you know, we obviously had a lot of belief in it. The primary endpoint is death, stroke, and re-hospitalization. And so it's really the composite of all those. And winning that trial, and obviously, the more you would win it by, makes a more compelling case.

Speaker Change: Sure Hey, Larry This is Larry Thanks for your question I think the and at a very high level there.

Needs to be a compelling story for why early intervention is better and basically make the case against watchful waiting and you know when we've done a lot of work and we're powering the trial and you know, we obviously had a lot of belief in it.

Speaker Change: The primary endpoint is death stroke and re hospitalization and so it's really the composite of all those and you know the winning that trial and and you know obviously the more you would win it by it makes them more compelling case in terms of the individual components will have to look at those but when you think about it from a patient journey.

Larry L. Wood: In terms of the individual components, we'll have to look at those. But when you think about it from the patient journey, if they're waiting and... [inaudible] Maybe, you know, let me add, you know, something to what Larry said, you know, for sure, you know, asymptomatic is very important to us, and to the community and to patients, but it is one, of you know all of the many things you know we are doing and we are confident in growing you know the Stavero, So asymptomatic is one, you know, patient activation, you know, we see some, you know, impact already, but also moderate.

Speaker Change: Waiting and and.

Speaker Change: No bad things are happening to them why their rating is resulting an unplanned re hospitalization north resulting in stroke, where it's resulting in mortality all of those are very meaningful things and that's why they're all composites and the endpoint. So you know we'll have to wait and see the data and we'll have to see the story, but death stroke and re hospitalization has kind of become almost a standard now for most of these trials because there.

Speaker Change: Clinical community believe these are all important considerations in imports.

Speaker Change: Maybe let me add something to what Larry said, you know for sure you know asymptomatic is very important to us and to the community and to patients like it is one thing off you know all of the many things we are doing and we are confident in growing at a steady about volatility. So asymptomatic is one patient activation.

Speaker Change: We see some impact already but also moderate so if you think about you know what we have in that.

Larry L. Wood: So if you think about, you know, over the next, you know, few years, we see, you know, many catalysts. This is why we are confident in this, you know, Taverop. Granted, you know, we know that, you know, Q2 was lower than expected, and I guess we are going to talk about that, but, you know, in front of us, we see that this opportunity is a big one, like we saw it a few years ago. We still see it, we are still confident, and we are doing all of the things to realize that. That's helpful. And Scott, thanks for the initial color on 2025.

Speaker Change: You know a few years, we see many catalyst. It is why we are confident.

Speaker Change: Teva about 40 D. T granted you know we know that you know Q2 was lower than expected and I guess, we are going to talk about it but you know in front of US we see that visa policies. He has a big one like we saw a few years ago to do we see do we are confident and we are doing all of the things to realize this opportunity.

Scott B. Ullem: You know, I'm sure you know, that's important. Everyone on this call right now should try to understand China, try as best as we can to model that. So a couple pieces, follow-ups on that. The press release says, you know, strong, sustainable growth. It doesn't say 10% operational growth for the remaining remaining business in 2025. I just want to confirm that the 10% from the analyst meeting last year in December is not if you're not reiterating that today.

Speaker Change: That's helpful and Scott Thanks for the the initial color on 20th twenty-five I you know I'm sure you know that's important to everyone. On this call right now to try to understand try to try to as best we can to model that so a couple of pieces follow ups on that the press release says you know strong sustainable growth it doesn't say 10 per.

Speaker Change: <unk> operational growth for the remainder remaining business in 2025, I just want to confirm that that 10% from the analyst meeting last year. In December is not is you're not reiterating that today and second you know on the dilution. We estimate I think most of US estimate about 40 cents dilution from critical care spin.

Scott B. Ullem: And second, you know, on the dilution, we estimate, I think most of us estimate about 40 cents of dilution from critical care spend, any reaction to that and the incremental spending you talked about from the acquisitions, any additional color on that. And just lastly, the use of the proceeds, should we just assume a share buyback or additional M&A?

Speaker Change: Any reaction to that and the incremental spending you talked about from the acquisitions any additional color on that and just lastly, the use of the proceeds should we just assume share buyback or additional M&A. Thank you.

Scott B. Ullem: Thank you. Alright, well, it's a multi-part follow-up question. Let me try to hit a couple of the things you asked about. First of all, on the 10% long-term top-line growth, we're just not commenting on guide... It doesn't mean we're increasing it or decreasing it or changing it. It's just the kind of thing where we don't update that during the course of the year.

Speaker Change: Alright, what a multipart follow up question, let me try to hit a couple of the things you asked about Larry first of all on the 10% long term top line growth. We're just not we're just not commenting on guidance at this point it doesn't mean, we're increasing it or or decreasing it or changing it is just the kind of thing where we don't update that during the course.

Scott B. Ullem: So we're not providing an update today. We will definitely provide an update, as we always do, at our December meeting. For dilution from critical care, a lot of this depends upon how we end up prioritizing, Transcription by https://otter.ai call it Remainco X Critical Care at this point. And it does tie to your question about incremental operating expenses that we're absorbing with these acquisitions. And those depend upon a couple of things. One is when we actually close the acquisition. Edwards Lifesciences Corp.

Speaker Change: For the year, so we're not providing an update today, we will definitely provide an update as we always do at our December Investor Conference.

For dilution from critical care, Yeah, you know a lot of it depends upon how.

Speaker Change: How we end up prioritizing investments in the company as we separate critical care and as you can imagine there are a lot of different moving pieces as we do that so we're not gonna be able either specific figure on.

Call. It remain co ex critical care at this point and it does tie to your question about incremental operating expenses that were absorbing with these acquisitions and those depend upon a couple of things one is when we actually close the acquisitions in and start to realize that.

Speaker Change: That spending to how we end up integrating them inside of Edwards and as you can imagine we just announced them today. So those plans are not completely.

Speaker Change: <unk> finally in terms of use of proceeds from critical care. Yeah. As you know we're always we're always interested in buying back stock, we're always looking for buying opportunities.

Scott B. Ullem: Finally, in terms of the use of proceeds from critical care, as you know, we're always interested in buying back stock, we're always looking for buying opportunities, but the first call on cash hasn't changed one bit, which is that we're going to continue to invest in the company, and we're going to continue to invest in the capacity that we need to support the growth of the company. We'll certainly be looking at other external investments. Finally, we'll look at allocating capital to the share buyback. So there's a little bit of color, and we'll obviously give you a lot more as we go. All right, thanks so much. Yes, please.

Speaker Change: But the first call on cash hasn't changed one bit which is we're going to continue to invest in the company, we're going to continue to invest in.

Speaker Change: The capacity that we need to support the growth of the company will certainly be looking at other external investments and then finally, we will look at capital and allocating capital to share buyback. So there's a little bit of color and we'll obviously give you a lot more as we get towards the end of the year.

Speaker Change: Maybe.

Larry L. Wood: Maybe something about Larry here, you know, on the guidance. I agree with what Scott said about we are not planning to communicate the guidance. If you look at the quarter, TAVR grew about 6, and the company about 8. We see a bigger contribution from TMTT, and we see that contribution to get bigger as we go. Right now, we are just at the beginning of Pascal expansion, just at the beginning of EVORC expansion. We have M3 coming, and in TAVR, we have asymptomatic end of the year. Are we confident about sustainable growth over the long term?

Larry Nicholson: Maybe if somebody like Larry here on the guidance you know I agree with what Scott said about where we are not planning to communicate the guidance on 'twenty 'twenty five, but if you look at the quality of it.

Speaker Change: Teva grew about six the company about eight so you'll see it even bigger.

Speaker Change: A bigger contribution from TNT, and we see that contribution to it to get bigger as we go because right. Now we are just at the beginning of Pascal expansion. You know just a busy beginning beginning of evoke expansion, we have aimed freak out being in to have ever known we have asymptomatic end of the year. So are we confident about you know is sustainable.

Speaker Change: Oh, you have a long term yes.

Bernard J. Zovighian: We are going to talk about guidance in December. Thank you. The next question today is coming from Robbie Marcus from J.P. Morgan. Your line is now live.

Speaker Change: We are going to talk about guidance in December.

Speaker Change: Thank you.

Speaker Change: Thank you next question today is coming from Robbie Marcus from JP Morgan Your line is that a lot.

Robert Justin Marcus: Oh, great. Thanks for taking the questions. Two for me.

Robert Justin Marcus: Oh, great. Thanks for taking the questions two for me.

Robert Justin Marcus: Maybe first you know you talked about it in the script, but I was hoping you could give a little more you know.

Robert Justin Marcus: Tampa has clearly come in below your initial expectations for the year at the guidance has moved down the U S is slowing or U S is facing pressure we saw at two of your smaller competitors, but still competitors see pretty nice growth sequentially and year over year.

Speaker Change: So their tankers, taking more in Europe and outside the U S. Japan.

Speaker Change: How are you thinking just about the underlying growth rate of the tanker market and I am I. Appreciate it's a huge opportunity and it's still a lot to conquer in the future, but in let's call. It the short to medium term how are you thinking about the overall market growth and is there anything you can do to help.

Speaker Change: Accelerated.

Robert Justin Marcus: Maybe first, you know, you talked about it in the script, but I was hoping you could give a little more. You know, TAVR has clearly come in below your initial expectations for the year. The guidance has moved down. The U.S. is slowing, and the O.U.S. is facing pressure.

Speaker Change: Yeah, Thanks, Robbie well, obviously, we expected growth rate to be higher in Q2 than it was you know we had had a slow start in Q1, but we were exiting March and we felt good about about where we were so so this didn't come as a surprise I think when we reflect back on it and we look more deeply at it yeah.

Robert Justin Marcus: We saw two of your smaller competitors, but still competitors, see pretty nice growth sequentially and year over year. So there are taverns taking more in Europe and outside the U.S., in Japan. How are you thinking just about the underlying growth rate of the tavern market? And I appreciate it's a huge opportunity, and there's still a lot to conquer in the future. But in what's called the short to medium term, how are you thinking about overall market growth? And is there anything you can do to help accelerate it?

Speaker Change: Have to think about all the things that have shown up that are going through the same structural heart team and all of these hospitals you know what.

Speaker Change: We're seeing rapid growth in <unk>.

Speaker Change: Mitral repair, we're seeing a lot of growth in other procedures and we had two new therapy approvals recently in the tricuspid space.

Larry L. Wood: Yeah, thanks, Robbie. Well, obviously, we expected the growth rate to be higher in Q2 than it was, you know, we'd had a slow start in Q1, but we were exiting March, and we felt good about where we were. So this did come as a surprise.

Speaker Change: A little bit we looked at the procedure volumes and you know the hospitals are shown a pretty good job of being able to handle these things we probably underestimated.

Larry L. Wood: I think when we reflect back on it, and we look more deeply at it, you have to think about all the things that have shown up that are going to the same structural heart team and all of these hospitals. You know, we're seeing rapid growth in mitral repair. We're seeing a lot of growth in other procedures, and we had two new therapy approvals recently in the tricuspid space. And I think a little bit. We looked at the procedure volumes, and you know, the hospitals have shown a pretty good job of being able to handle these things.

Larry L. Wood: We probably underestimated the burden of even starting these new programs, even preparing to start these new programs, because you have to screen the patients early on, there's a lot of learning, screen failures, all of those things. And I think it's just taxing the teams.

Speaker Change: The the burden and even starting these no programs even preparing to start these new programs.

Speaker Change: You have to screen the patients early on there's a lot of learning screen failures all of those things and I think it's just it's just happening the teams now in terms of things. We can do to help there are certainly things. We can do to help we can do a lot of imaging work up and take some of the load off the team. We can do device, perhaps we can come in with our benchmark program and teach them.

Larry L. Wood: Now, in terms of things we can do to help, there are certainly things we can do to help. We can do a lot of imaging workups and take some of the load off the team. We can do device preparation; we can come in with our benchmark program and teach them efficiencies and do those things. But once a program's been optimized, then it really does come down to the hospital to add another team or add additional days and do those sorts of things. So, there are some things we can do, but we can't do everything.

Speaker Change: <unk> fees and do those things, but once the program spanned optimized but it really does come down to the hospital to add another team or add additional bays and do those sorts of things. So theres. Some things we can do or we can't do everything I think the other thing is I think highlighting this for the for the clinicians and.

Larry L. Wood: I think the other thing is, I think highlighting this for the clinicians. And, you know, we're very confident this isn't some slowdown because there's a lack of patience. You know, we didn't see any of the fundamentals change in terms of new data that was concerning or any of these things.

Speaker Change: You know, we're very confident this isn't some slow down because there's a lack of patients we didn't see any of the fundamental change in terms of new data that was concerning or any of these things I think it's just a matter of the workflow right now and we.

Larry L. Wood: I think it's just a matter of the workflow right now. We need to be able to engage with hospitals, but two important things we saw is that we saw an increase in time from CT to procedure, which indicates patients are waiting longer. And the other thing that we saw was a sharp increase in the number of cases being coded as emergent versus routine. And I think that speaks to these patients waiting in the queue as these workflow issues sort themselves out.

Speaker Change: We need to be able to engage with hospitals, but you know two important things. We saw is we saw an increase in time from C. T. Two procedure, which indicates patients are waiting longer and the other thing that we saw was a sharp increase in the number of cases being coded as emergent versus routine and I think that speaks to these patients waiting in the queue.

Larry Nicholson: As he has worked for US you sort out so I think hospitals will certainly do that in time. These patients don't wait well and we know that theres a lot of them, but you know we're gonna have to continue to work through that with the hospitals. So let me add you know on what Larry said to be fair, we are contributing a little bit.

Larry L. Wood: So I think hospitals will certainly do that in time. These patients don't wait well, and we know that there are a lot of them. But we're going to have to continue to work through that with the hospitals. So let me add to what Larry said. To be fair, we are contributing a little bit to this pressure.

Speaker Change: This pressure at the same time you know we are benefiting if you look at TNT T Girls you know within the quarter. So we are contributing and benefiting at the same time now you know big picture. What we have seen you know vis a picture in the past that you think we are seeing you know hospital.

Bernard J. Zovighian: At the same time, we are benefiting. If you look at the TNTT growth in the quarter, we are contributing and benefiting at the same time. Now, the big picture. We have seen this picture before, don't we think?

Bernard J. Zovighian: We have seen hospitals facing more to do, more technology to adopt, and to be trained on new technologies. And they are very good at scaling. They are very good at learning.

Speaker Change: Facing like you know more to do more technology to adopt to be threatened on new technologies and we are very good at scaling a little.

Bernard J. Zovighian: They are very good at adapting their workflows in the cat lab, so we believe this is temporary. And we are, the viewers, with this team are, with Larry, partnering on this one. So we are fully focusing on this one, helping in the hospital. But we have faith the hospitals are going to do that like they did it in the last 10 years. Great, and maybe a follow-up to that guidance implies roughly stable TAVR first half into the second half.

Speaker Change: We are very good at adapting you've got workflows in the Cath lab. So we believe it is temporary.

Speaker Change: And we are you know davita, so any with Tmall and with.

Speaker Change: Partnering on this one so we are you know fully you know focusing on this one helping us in the hospital, but we have faith that the hospitals are going to do that like we did it in the last 10 years.

Speaker Change: Thanks.

Bernard J. Zovighian: You know, I appreciate the need to be conservative, but it sounds like some of the learnings you saw in the second quarter could possibly help in the back half of the year. Maybe just walk through the thought process of the five to 7% TAVR guide and kind of what you're baking into that. Thanks a lot.

Speaker Change: Great and.

Speaker Change: Maybe a follow up to that guidance implies roughly stable tap her first half into second half.

Speaker Change: You know I appreciate the need to be conservative, but it sounds like some of the learnings you saw in second quarter could possibly help in the back half of the year, maybe just walk through the thought process of the 5% to 7% Tavern guide and kind of what you're baking into that thanks a lot.

Larry L. Wood: Yeah, we're I mean, it's pretty straightforward, which is we're baking into it similar market conditions. You know, the year over year calculation is pretty similar, but fourth quarter comp gets a little bit tougher. But we think that, all things considered, that 5% of the low end and 7% on the high end captures the likely scenario for the second half combined with the first half that we've already reported. We believe, you know, to add to that one, we believe, you know, early tether at TCT, you know, it will already be almost, you know, almost the end of a quarter, Robbie. So TCT is in late October. So we believe it will have, you know, a very minimal impact in Q4. So that is why we didn't want, you know, to take, you know, too much risk.

I mean, it's pretty straightforward, which is we're baking into it similar market conditions, you know the year over year, our calculation is pretty similar.

Speaker Change: Quarter comp gets a little bit tougher, but we think that all things considered that 5% of the low end and 7% on the high end captures the likely scenario for the.

Speaker Change: The second half combined with the first half that we've already reported.

Speaker Change: Thanks.

Speaker Change: We believe that's what we believe are early Teva at TCT, we it would be already almost you know the end of a quarter of Robbie So tcp's in late October. So we believe it will have very minimal impact in Q4, So which is why we didn't want to take too much risk here.

Bernard J. Zovighian: Thank you. The next question today is coming from David Roman from Goldman Sachs. Your line is now live. Thank you. Good afternoon.

Speaker Change: Thank you next question today is coming from David Roman from Goldman Sachs. Your line is now live.

David Harrison Roman: I wanted just to come back actually on some of Larry's comments there regarding, maybe you're characterizing it as capacity. And as you think about the myriad of therapies going into structural heart right now, whether that is some of the new valve therapies, whether it's Watchmen, to what extent do you think hospital economics factor into the decision and prioritization making here? And how does that, if it does in any way impact your kind of pricing decision around, or a vote? That's a good question and I'll defer to Daveen on a vote, but I'll start with the TAVR side of it. It doesn't really change the pricing, and we don't think this is an economically driven thing.

David Roman: Thank you and good afternoon, I wanted just to come back actually and so Larry's comments are regarding I, maybe youre characterizing it as as capacity and as you think about the myriad of therapies going into structural heart right now whether that is some of the new valve therapies, whether it's watchman to what extent do you think.

Hassel economics factor into the decision and prioritization, making here and how does that if it does in any way impact your kind of pricing decision around cover or or evoke.

Speaker Change: Yeah, that's a good question and I'll defer to being on a boat, but I'll start with the with the tavern side, but it doesn't really change the pricing and we don't think this is an economically driven thing I think when new therapies come forward. You know hospitals are competitive they want to be able to offer all of the therapies and that means they want to aggressively start these newer programs in and make sure of it.

Larry L. Wood: I think when new therapies come forward, hospitals are competitive. They want to be able to offer all of the therapies, and that means, you know, they want to aggressively start these new programs and make sure that they can offer all of the options for their patients. And so I think that's what's driving some of this more than other things. And, you know, I think all companies, before they're willing to bring new technology in, they want to see the center demonstrate competence, right? They have to demonstrate they have the ability to screen.

David Roman: Can offer all of the options for their patients and so I think that's where it's driving some of this more than other than other things and you know I think all companies before they were able to bring a new technology and they wanted the center has to demonstrate competence right. They have to demonstrate they have the ability to screen out patients during Q and all those things that I think it becomes a big thing, but I don't think this.

Larry L. Wood: They have to have patients in queues and all those things, and I think it will become a big thing. But I don't think this is an economically driven thing.

Devine: And economically driven thing I think it is just the result of all the new things that are coming to the Cath lab and again I think that does get corrected with pine. Yeah. I'll. Just this is devine I'll jump in for a second here. So we're seeing as we bring a new therapy like evoke right raw procedure times are very relatively efficient and they are there, but an hour long procedures. It takes up a lot of energy effort thoughts process.

Larry L. Wood: I think it is just the result of all the new things that are coming into the cath lab. And again, I think that does get corrected with time. Yeah, I'll just, this is Daveen. I'll just jump in for a second here.

Daveen Chopra: So we're seeing as we bring new therapies like Evoque, right? While procedure times are relatively efficient, and they are, they're about an hour-long procedures, it takes up a lot of energy, effort, thoughts, processes to start a new therapy, right? It takes up a lot of bandwidth for people in terms of trying to find patients. Where are the referrals coming from? How does it kind of work through the system?

Speaker Change: To start a new therapy right. It takes all the bandwidth for people in terms of trying to find the patients where the referrals coming from how does it kind of worked through the system. How do we pre case plan and these are often the same groups of people valve clinic coordinators visit interventional cardiologist et cetera that are working on tavern says, you're bringing a new therapy and start building it up it takes a.

Daveen Chopra: How do we pre-case plan? And these are often the same groups of people, valve clinic coordinators, interventional cardiologists, et cetera, that are working on TAVR. So as you bring in just a new therapy and start building it up, it takes a while, a lot of bandwidth, and a lot of energy to get it going. But then, over time, like we've seen for every other therapy, you create efficiency, and it gets faster. And we're going to help them do that.

Speaker Change: While a lot of bandwidth and a lot of energy to get it going but then over time like we've seen for every other therapy you create efficiency gets faster and we're going to help them do that but hospitals and figure out. Okay. Now. This is how the therapy is going to work its way through the system and it becomes more efficient and becomes better. So that there is more capacity to do more procedures overall.

Daveen Chopra: But hospitals then figure out, okay, now this is how the therapy is going to work its way through the system. And it becomes more efficient and better so that there is more capacity to do more procedures overall. That's very helpful. And maybe just a related follow-up to that. Can you maybe unpack the $83 million in the TMTT line for us in a little bit more detail? It sounds like minimal evoke contribution with Pascal accelerating.

Speaker Change: That's that's very helpful and maybe just a related follow up to that can you maybe unpack the $83 million in the TMT tea line for us and a little bit more detail.

Daveen Chopra: But maybe if you could sort of delineate a little bit the different product drivers within there, and then maybe some of the different geographic drivers. And then maybe if I could sneak a follow-up into the response there, how long do you think Larry it takes to dislodge this sort of capacity constraint or sort of digestion of multiple therapies going forward? Now, this is Daveen.

Speaker Change: It sounds like minimal evoke contribution, but with Pascal accelerating but I mean, maybe.

Speaker Change: If you could sort of delineate a little bit the different product drivers within there and then maybe some of the different geographic drivers and then maybe if I could sneak a follow up into the response there how long do you think Larry it takes too.

Larry Nicholson: Dislodge this sort of a capacity constraint or sort of died digestion of multiple therapies going through the system.

Daveen Chopra: I'll start off a little bit with TMPT. I mean, first, just at a higher level, we were actually super excited to see that in quarter two, our vision of, you know, becoming more and more reality, we made a strategic commitment that we need a portfolio of repair and replacement technologies for the many different mitral and tricuspid patients. And it was nice to see that step forward in Q2. Ultimately, when you break it down on the level, Q2 sales were led by Pascal, right?

Larry Nicholson: No. This is David and I'll start off a little bit with T. M. P. T. I mean first just at a higher level, we were actually super excited to see that in quarter two our vision of.

Speaker Change: Becoming more and more of a reality, we've made a strategic commitment that we need a portfolio of repair and replacement technologies for the many different mitral and tricuspid patients and it was nice to see that step forward in Q2 I'm also when you break it down to the level of Q2 sales were led by led by Pascal right. Pascal is the larger pool it continues to.

Daveen Chopra: Pascal is a larger pool, it continues to grow and adopt, we believe in this differentiated premium technology, and it was our largest growth driver. We also did see the early commercial introduction in the US and Europe of Evoque, right?

Speaker Change: Growing adoption, we believe in this differentiated premium technology and it was our largest growth driver. We also did see the early commercial introduction in the U S and Europe I've evoke right a vote got approved in Europe late last year in the U S. Earlier. This year. So we're beginning that important process of training centers getting up to speed being too.

Speaker Change: Our own internal people and start that kind of case cadence. So those were kind of the two and in terms of size and scale just because in Europe. We've been in Europe. Since 2019, now that's a much larger base since when you have a larger base you have kind of a stronger growth coming off that but the U. S is a is growing up quickly now and will continue to expand our technologies around.

Daveen Chopra: Evoque got approved in Europe late last year, and in the US earlier this year. So we're beginning that important process of training centers, getting up to speed, training our own internal people and starting that kind of case cadence. So those were kind of the two.

Speaker Change: The world beyond just the U S and Europe.

Daveen Chopra: And in terms of size and scale, just because we've been in Europe since 2019, that's a much larger base. And so when you have a larger base, you have kind of stronger growth coming off that. But the US is growing up quickly now. And we're continuing to expand our technologies around the world beyond just the US and Europe. Yeah, and just to follow up, how long does it take to dislodge?

Speaker Change: And just a follow up how long does it take to dislodge you know it's hard for us to be exacting. We you know I think we tried to account for that in our guidance, but it's not a light switch, but the best analogy I can say is when we brought tavern. All these hospitals, we heard repeatedly that there was impact on our coronary procedures and other things that were going on in the Cath lab, and we were kind of taking up a little bit of that mindshare.

Larry L. Wood: You know, it's hard for us to be exact, and we, you know, I think we try to account for that in our guidance, that it's not a light switch, but the best analogy I can say is when we brought TAVR into all these hospitals, you know, we heard repeatedly that there was an impact on coronary procedures and other things that were going on in the cath lab, and we were kind of, you know, taking up You can't just park your coronary patients forever, and you can't park AS patients forever.

Speaker Change: And a little bit of that workflow space, but it wasn't sustainable you can't just park your coronary patients forever and you can't Park I ask patients forever. So I think once centers have certainty of the added work loaded certainty of the volume I think they had the resource when they do the things necessary, but nobody's going to go hire a bunch of people in advance of the new therapy show up they always are.

Larry L. Wood: So I think once centers have certainty of the added workload and certainty of the volume, I think they add the resources, and they do the things necessary, but nobody's going to go hire a bunch of people in advance of the new therapy showing up. They always are kind of, you know, recovering as the workload gets high, and I think to agree that's just how hospital systems operate. Yeah, we are confident, you know, from experience that the hospital is going to learn fast.

Speaker Change: Kind of you know recovering as the workload gets high and I think to a degree that's just how hospital systems operate yeah. We are confident about your experience with a long way to learn fast.

Speaker Change: Just you know they don't work for all of our processes.

Bernard J. Zovighian: Adjusting their workflow, their processes, and you know it is why we are seeing it is temporary obviously, you know this patient when they stay home, they have a terrible quality of life, and many of them are dying so I don't believe it is sustainable. You know, everybody is committed. The hospital is committed. We are committed. So when you have a full commitment behind it, we know it is going to be resolved. Thank you for taking the time to answer the question.

Speaker Change: And you know this is why you know we are seeing it as you know temporary are obviously.

Speaker Change: Obviously, you're gonna be space shouldn't whether they stay home you have to have a terrible quality of life and many of them. All day. So I don't believe it is sustainable you know to and everybody's committed committed we are committed so when you have you do a full commitment behind it we know it is going to be resolved.

Speaker Change: Got it thank you for taking the questions.

Bernard J. Zovighian: Thank you. The next question today is coming from Josh Jennings from TD Cowen. Your line is now live. Hi, good afternoon. Thanks for taking the questions. Wanted to just start off with the TABR outlook and kind of longer term.

Speaker Change: Thank you next question today is coming from Josh Jennings from Cowen Your line is that lives.

Joshua Thomas Jennings: You guys have put a $10 billion TAM forecast by 2028 in the past. Should investors still be thinking about that TAM and that opportunity being in place, but maybe pushed out a little bit, or maybe the aortic regurgitation indication gets you there by 2028? But I know you may not be repeating today, but it sounds like you're confident in the TAVR market and that $10 billion TAM, but I'm not sure if you're repeating that now.

Joshua Thomas Jennings: Hi, good afternoon. Thanks for taking the questions wanted to just start off with the tower.

Joshua Thomas Jennings: However, the outlook and a kind of longer term you guys have put a $10 billion Tam forecast by 2028 in the past.

Is that should we choose the best should still be thinking about that Tim.

Speaker Change: Truly being in place, but maybe pushed out a little bit or maybe the aortic.

Speaker Change: Career education indication gets you there by 2028, but I know that you may not be reiterating today, but it sounds like you're confident in the Tampa market to Africa and that in that $10 billion Tam, but I'm not sure if youre reiterating it now.

Joshua Thomas Jennings: Yeah, I think you said it in your question, you know, we are confident we are not updating the guidance for next year for 2028 here on the market, but we are confident we will do so in December at the investor conference in New York. Thank you. Thank you. The next question is coming from Travis Steed from Bank of America. Your line is now live.

Speaker Change: Yeah, I think you said it in your question you know we are confident we are not updating the guidance for next year for 2020, a tier on the market, but we are confident we will do so in December.

Speaker Change: The Investor Conference in New York.

Speaker Change: Thank you.

Speaker Change: Great.

Speaker Change: Yeah.

Speaker Change: Thank you next question is coming from Travis Steed from Bank of America. Your line is that life.

Travis Lee Steed: Hey, thanks for taking the question. I wanted to go back and circle back on Ravi's question on TAVR. It feels like there's a little bit more of a change here. You know, just three months ago, you thought TAVR was going to accelerate over the course of the year. I thought the 8 to 10, the beginning of the year, was supposed to be a conservative guide.

Hey, Thanks for taking the question.

Speaker Change #100: I wanted to go back and circle back on Robin's question on on top of it.

Speaker Change #101: It feels like there's a little bit more of a change here.

Travis Lee Steed: So just want to understand, like, I hear what you're saying on TMTT, but that's a small number of fractions versus the overall TAVR centers. So I don't know if there's anything else that you'd kind of call out, or kind of what surprised you on the TAVR line. I know there was some of the European stuff and competition there that you called out last quarter.

Speaker Change #102: It was just three months ago, you thought it was going to accelerate over the course of the year I thought the eight to 10 at the beginning of the year was supposed to be a conservative guy. So I just want to understand like the euro.

Speaker Change #103: What you're saying on T M T T.

Speaker Change #104: But it's that's a small number of fractions versus the overall power centers.

Speaker Change #105: So I wonder if there's anything else that you'd kind of call out of kind of what surprised you on the top line I know there was some of the European stuff and competition. There that you called out last quarter, just just understanding kind of the full change and you know why you got the initial type of guy wrong start to this year.

Larry L. Wood: Just understanding kind of the full change and, you know, why you got the initial TAVR guide wrong at the start of this year. Yeah, thanks, Travis. Yeah, you know, when we exited Q1, we felt we were on a good ramp, and we felt we were on a good pace. And that's why we reiterated guidance. We felt good about it, and, you know, we just didn't see that play out in Q2 the way that we anticipated. And by no means do I mean to say this is all Daveen's fault, and it's all a vote because that's not accurate or fair.

Speaker Change #104: Yeah.

Speaker Change #106: Yeah, you know when we exited Q1, we felt we were on a good ramp and we thought we were on a good pace and that's why I reiterated guidance and we felt good about it and we just didn't see that play out in Q2, the way that we anticipated and.

Larry L. Wood: When you look at the number of procedures, I think it's the cumulative impact of all the things that have hit the structural heart teams over the last year. And, you know, it's one of those things you can always increase a little capacity, work a little harder, increase a little capacity, work a little bit harder. But then, at some point, you reach a break point when it's simply too much. And the heaviest lift for centers is starting a program.

Speaker Change #106: By no means do I mean to say this is all the beans fault and it's all about.

Speaker Change #106: That's not accurate or fair when you look at the number of procedures I think its the cumulative impact of all the things that have hit the structural heart teams over the last year and you know it's one of those things you know you can always increase the lower capacity work a little harder increase overcapacity work a little bit harder, but then at some point you reach a breakpoint when it is simply too much and.

Larry L. Wood: And it's not just the procedure volume. It's all that screening and all of the case reviews and all the interaction that just consumes a lot of resources and a lot of time. And, you know, the training. They have to go to training and observe cases in many cases and all of those sorts of things.

Speaker Change #106: The heaviest lift for centers is starting a program and it's not just the procedure of arguments all that screening and all of the case reviews and all the interaction. They just consumes a lot of resources and a lot of time and you know the training you know they have to go to training and observed cases in many cases in all of those sorts of things and so I think it's just that the cumulative impact.

Speaker Change #106: All of those things that happen overtime, and we did see the slowdown more acutely in large centers and small centers, which fits a little bit of the model as well in terms of the centers that are most likely to be looking to start these new programs and our competitive about that and.

Larry L. Wood: And so I think it's just the cumulative impact of those things that happen over time. And we did see the slowdown more acutely in large centers than in small centers. Which fits a little bit of the model as well in terms of the centers that are most likely to be looking to start these new programs and are competitive about that. And, you know, again, I said it earlier, but we did see a spike in emergent cases over routine cases. And I think that fits, you know, fits what we're saying as well. But that's not going to be sustainable for people.

Speaker Change #106: I said it earlier, but we did see a spike in AR and emergent cases over routine cases, and I think that that's you know that.

Speaker Change #106: That's why we're saying as well.

Larry L. Wood: Emergent cases have more complications, and they don't have as good patient outcomes. And, you know, people will have longer lengths of stays, and that's going to adversely impact patients and the hospitals themselves. So I think people will have to adjust to that over time. And, you know, we're going to have to work closely with them to help them do that. All right. That's helpful. Any color on Q3, Taver, and kind of where that's settling out versus the full year guide?

Speaker Change #106: But that's not going to be sustainable for people are emergent cases have more complications if they don't have as good a patient outcomes.

Speaker Change #106: And you know people will have longer length of stay and that's gonna adversely impact patients in the hospitals themselves. So I think people will have to adjust that over time and you know we're gonna have to work closely with them to help them do that.

Speaker Change #106: Alright.

Travis Lee Steed: I think you guys had extra selling days in Q3. And then on the dilution from the acquisitions, I know there's a range of outcomes, like it's going to be, we all have a pretty good sense of critical care and the dilution there. But just to give a sense of the kind of range of outcomes for some of the dill dilutions that you've got, like I was thinking 10 cents is kind of the ballpark, but I don't know if you'd react to that at all.

Speaker Change #107: That's helpful. Any any color on Q3 tower and kind of where that settling out first before you got I think you guys had extra selling days in Q3, and then on the dilution from the acquisitions.

Speaker Change #108: There's like a range of outcomes like that's going to be but we all have a pretty good sense of critical care and the dilution there, but just to give a sense of kind of a range of outcomes on on some of the dilution that you've got like I've always thinking 10 census is kind of a ballpark, but I don't know if you react to that at all.

Scott B. Ullem: Yeah, thanks for the question, Travis. You know, for Q3, you're right, we do have a little help from extra selling days in the third quarter. So and that's factored into our guidance, you know, it's in the guidance that we've provided. In terms of dilution from acquisitions, again, we've got to first close the acquisitions, then work on integrating them. Obviously, we spent a lot of time with the plan, but it takes some time before we actually get businesses in house and start recording what kind of financial implications there are. Before we can report out on those, we'll know a lot more by the end of next quarter when we've actually gotten further down the path. And we'll talk about it then.

Speaker Change #109: Yeah. Thanks for the question Travis you know on Q3, you're right. We do have a little help from extra selling days in the in the third quarter, So and that's factored into our guidance.

Speaker Change #110: It's in the guide that we've provided in terms of dilution from acquisitions again, we've got a first close the acquisitions then work on integrating them. Obviously, we spent a lot of time with the plan, but it takes some time, we actually before we actually get businesses in house and start a recording what kind of financial implications there before we can report.

Speaker Change #110: I don't know if we'll know a lot more by the end of next quarter. When we've actually gotten further down the path and we'll talk about it then and of course, we'll give full guidance for EPS in 2025 at our Investor Conference.

Scott B. Ullem: And, of course, we'll get full guidance for EPS in 2025 at our invitation. Very great. Thanks a lot.

Speaker Change #111: Okay, great. Thanks, a lot.

Speaker Change #110: Yeah.

Matthew Charles Taylor: Thank you. The next question today is coming from Matt Taylor from Jeffries. Your line is now live.

Speaker Change #112: Thank you. Your next question today is coming from Matt Taylor from Jefferies. Your line is now live.

Matthew Charles Taylor: Hi, thanks for taking the question. I guess I wanted to follow up on some of your U.S. commentary or commentary and the workflow angle. I guess I'd like to understand better why you think it's showing up so acutely now, given you're still in a limited rollout of EVOKE. Is this an issue that's been arising for a while, and we're just seeing it more now?

Matthew Charles Taylor: Hi, Thanks for taking the question I guess I wanted to follow up on some of your U S tavern commentary and the workflow.

Matthew Charles Taylor: Bangle, because I'd like to understand better why why do you think it's showing up so acutely now.

Speaker Change #114: Now I guess, given you're still in a limited rollout of evoke has it.

Speaker Change #114: And the issue that's been matriculating for awhile and we're just seeing it more now and could you help us understand in your.

Matthew Charles Taylor: And could you help us understand? In your history there, you talked about the impact on coronaries. How long do you think it'll take for the hospital to adjust? Is this a one-quarter or three-quarter issue? Does it take years?

Speaker Change #115: History, there you talked about the impact on coronary so how long do you think it'll take for the hospital to adjust this a one quarter or three quarter issue as it take years, what kind of timeframe would you put on them and adjusting to accommodate the additional workflows.

Larry L. Wood: What kind of timeframe would you put on them to adjust to accommodate the additional workload? Yeah, thanks, Matt. You know, the thing that I would say is, you know, I guess I would draw an analogy. If you had a factory and you saw demand for your product going up, you can always add a little more hours, and you always have a little bit of excess capacity, and you can adjust to those things. But I think there is just a point in time where you hit a wall, and it's harder to do those things.

Larry L. Wood: And I think that's a little bit of what we saw here. It's the cumulative effect of all of these things that have played out over time. If you look at total cath lab procedures for the structural heart team in the last three years, it's probably close to doubled during that period of time, which is a lot of growth that these teams are having to absorb, and they're having to adapt to. And I think it will take time. And again, you know, when you're starting these new programs, these new therapies, that's the heaviest lifting part of it.

Matthew Charles Taylor: Yeah. Thanks, Matt.

Speaker Change #116: You know the thing that I would say is you know I guess, if I were to draw an analogy you know if you had a factory and you saw demand for your product going up you know you can always go out a little more hours and you always have a little bit of excess capacity and you can adjust to those things I think there is just a point in time, where you you hit a wall and it's harder to do those things and I think that's a little bit of what we saw here, it's the cumulative effect.

Speaker Change #116: Of all of these things that have played out over time. If you look at total Cath lab procedures for the structural heart team in the last three years, it's probably close to doubled during that period of time, which is a lot of growth, but these teams are having to absorb and they're having to adapt to and I think it will take time and again you know when youre starting these new programs. These news.

Larry L. Wood: And, you know, again, I think this gets corrected over time, and we'll work closely with the hospitals to do that. But, you know, we reflected that in our guidance and just wanted to be realistic and not be tone deaf to what's happened. But the same thing I'll tell you is that none of us are happy with the growth rate.

Speaker Change #117: The piece, that's the heaviest lift part of it and you know again I think that gets corrected over time and we'll work closely with the hospitals to do that but you know we reflected that in our in our guidance and just wanted to be realistic and not be not be tone deaf to what's happened, but at the same thing I'll tell.

Speaker Change #117: None of US are happy with the growth rate none of us are happy adjusting guidance and we're gonna be working as hard as we can to do everything we can to restore the growth for where we think it should be and you know we are not that be as a company.

Larry L. Wood: None of us are happy with the guidance, and we're going to be working as hard as we can to do everything we can to restore the growth to where we think it should be. And, you know, we are not happy as a company. You know, the patients are not happy. The physicians are not happy.

Speaker Change #118: Patients I'm not happy, but physician I'm also happy to be honest, we tell them out that would be so we are already fully aligned about it as a problem and we need to solve it so when she's like Oh. So you know we are confidence here.

Bernard J. Zovighian: The hospitals are not happy. So we are all, you know, fully aligned about it being a problem and we need to solve it. So that is why also, you know, we are confident here. Thank you. Thank you. The next question today is coming from Vijay Kumar from Evercore ISI. Your line is now live.

Speaker Change #119: Okay. Thank you.

Speaker Change #119: Thank you next question say somebody from Vijay Kumar from Evercore ISI. Your line is now live.

Vijay Muniyappa Kumar: Hey guys, thanks for taking my question. I guess one on, you know, just based on what competition is saying, I know there's been noise about small and light trials, is, like, how do you respond to, you know, this is not comparative dynamics, what we're seeing in the US market? Sure, yeah, we presented our data at New York Valve, and I don't think we've seen the impact of that in any meaningful way. I know some of the smaller competitors have reported, but you have to take their growth rates in consideration of the base they're growing off of versus the base that we're growing off of globally.

Vijay Muniyappa Kumar: Oh, Hey, guys. Thanks for taking my question I guess that one on.

Vijay Muniyappa Kumar: You know just based on what competition is saying.

Vijay Muniyappa Kumar: There's been noise on a small and lifestyle is like how do you respond to.

This is not comparative dynamics, what we're seeing in the U S market.

Speaker Change #121: Sure. Yeah, you know we presented our data at New York valve in and I don't think we've seen reached any impact of that in any meaningful way I know some of the smaller competitors have reported but you have to take their growth rates and consideration of a base, they're growing off a versus the base that we're growing off a globally. Okay.

Larry L. Wood: And maybe, Scott, one for you on the guidance here, EPS. Think prior guidance, 270 to 280 inclusive critical care, right? Is that still intact? Or, you know, what's the new range? I just want to get an apples-to-apples sort of EPS baseline. Yeah, it's a fair question.

Scott: Understood and maybe Scott Scott one for you on the guidance here E. P. S think prior guidance to 70 to 80.

Speaker Change #122: Inclusive of our critical care right is that still intact or Hum you know whats the new range, but I just wanted to get an apples to apples.

Speaker Change #122: Sort of EPS at baseline.

Scott B. Ullem: We are not providing a new update. And the reason is that, you know, we know critical care is going to close sometime late in the third quarter. But as a result, the fourth quarter will not include critical care. And so we ran, you know, obviously, we've looked at a whole bunch of different pro forma scenarios, but it didn't make sense to try to provide some kind of a bridge to the original 270 to 280 guidance. So sorry, but we're not given an updated number for the full company. Just because it's not wouldn't be comparable with critical care coming out, you know, at the end.

Speaker Change #123: Yeah. That's a it's a fair question, we are not providing a new update and the reason is because we know critical care is going to close sometime late in the third quarter, but as a result fourth quarter will not include critical care and so we round you know obviously, we've looked at a whole bunch of different pro forma scenarios, but it didn't make.

Speaker Change #123: Sense to try to provide some kind of a bridge to the original 270 280 guidance, so sorry, but we're not giving an updated number for the full company just because it's not it wouldn't be comparable with critical care coming out.

Speaker Change #123: End of the third quarter.

Scott B. Ullem: Or is there a comparable, like with critical care for the full year, what the underlying number is? Well, the underlying number is actually pretty similar in terms of growth rate with and without critical care. Our guidance for the full company is eight to 10% underlying growth. That's similar whether it includes critical care for the full year or excludes critical care for the full year. We have not translated that down to EPS, which is understandable.

Speaker Change #124: Or is there a comparable like without critical care for the full year, what the what the underlying number is.

Speaker Change #125: Well the underlying number is actually pretty similar in terms of growth rate with and without critical care and our guidance for the full company is 8% to 10% underlying growth. That's similar whether it includes critical care for the full year or excludes critical care for the full year, we have not translate that translated.

Speaker Change #125: Down to EPS with or without.

Speaker Change #125: Understood.

Thanks, guys.

Vijay Muniyappa Kumar: Thanks, guys. Thank you. The next question is coming from Patrick Wood from Morgan Stanley. Your line is now live.

Speaker Change #125: Thank you next question is coming from Patrick Wood from Morgan Stanley. Your line is now live.

Patrick Andrew Robert Wood: Fabulous. Thank you so much. Just two quick ones.

Patrick Andrew Robert Wood: Fabulous. Thank you so much just two quick ones.

Patrick Andrew Robert Wood: I guess on the Evoque side and the initial rollout of the clinical feedback and success rate you guys have had, how's that been going? You know, there's been a little bit of volatility in the MAUD database, so I'm just curious how the clinician feedback has been. Hey, thanks so much, Patrick. This is Daveen.

Patrick Andrew Robert Wood: I guess on the evoke side and the initial rollout on the the clinical feedback and success, where you guys have had.

Patrick Andrew Robert Wood: How's that been going you know theres been a little bit of volatility in the more database. So I'm just curious how the clinician feedback has been.

Daveen Chopra: Overall, if you pull back, we've actually been very pleased with the initial rollout of Evoque in both the U.S. and Europe. We continue to see really strong physician demand, and it really, for us, reinforces the unmet need of these patient groups who are looking for better solutions. As I mentioned earlier, we're seeing those predictable outcome times.

Devine: Hey, Thanks, so much Patrick this is devine overall, if you pull back we've actually been very pleased with the initial rollout of evoke in both the U S and Europe, we continue to see really strong physician demand and it really for us reinforces the unmet need of these patient groups are looking for better solutions as.

Speaker Change #127: As I mentioned earlier, we're seeing those predictable outcome times, we're seeing it similar to the clinic trial and two five years, we're seeing very similar clinical result to what we saw in the clinical trials specifically from trice into so we've been seeing very similar rates there kind of clinical outcome. We've seen so far in the journey, especially in Europe, now where Pascal.

Daveen Chopra: We're seeing it similar to the clinical trials. And to follow up, we're seeing very similar clinical results to what we saw in the clinical trials, specifically from Tricin2. So we've been seeing very similar rates there of clinical outcomes.

Speaker Change #127: It was actually approved for evoke we see that it reinforces the need for both the repair and replacement technology to really treat the maximum number of evoke patients. So overall, we continue to be very excited and happy with where the evoke watches going.

Daveen Chopra: We've seen so far on the journey, especially in Europe now, where Pascal is actually approved for Evoque, we see that it reinforces the need for both a repair and a replacement technology to really treat the maximum number of Evoque patients. So overall, we continue to be very excited and happy with where the Evoque launch is going to be. Very helpful. And then maybe just quickly on endotronics. You know, I was with Harry and Ariel at THT, and the conical data on their side looks very interesting.

Very helpful. And then maybe just quickly on electronics.

Speaker Change #128: I was with <unk> T H T and like the clinical data on that slide looks very interesting how do you see this fitting into the to the business overall, because my understanding was that probably this would be initially used to.

Daveen Chopra: How do you see this fitting into the business overall? Because my understanding was that this would probably be initially used for fine-tuning medication management, right? Is this more about building a Rolodex of patients so that you know them a little bit better further downstream when it comes to the trans-catheter approach? How do you see a strategic... Now, thanks for the question.

Speaker Change #129: Fine shooting medication management right is this more about building the rolodex of patients. So that you know them a little bit better for the downstream when it comes to Transcatheter approach, how do you see as strategically fitting in.

Bernard J. Zovighian: So let me start with the big picture, you know, first, you know, the patients. We are, we decided, you know, to get into this field because we see, you know, a very large patient population in need. Heart Failure is... One-off is not the largest driver of healthcare spending in the U.S. We have known the company for a long time, we were an investor in the company, we believe that they have very unique technology, differentiated technology, and as a matter of fact, they received a broad label from FDA last month. In December, we will have a full deep dive on the strategy for endotronics.

Speaker Change #130: Yeah no. Thanks for the question.

Speaker Change #131: So let me start you know big picture, we fell short of our patients.

Speaker Change #130:

Speaker Change #130: We decided to get into this field because we see it very loud at a patient population he needs and heart failure is one off if not you'll have allowed just driving off any scale spending in the U S.

Speaker Change #130: We have not you know if a company for a long time, you know we were investing in the company.

Speaker Change #130: We believe that you know we have very unique technology, and a differentiated technology and as a matter of fact, they receive a broad labor from FDA last month.

Speaker Change #130: You know there is an NCD undergoing right now so we see that as a big opportunity and that's your whole progression for us if you're asking about you do them very clear. It is thought to G. About you know what we are going to do we're going to where we are going to staff. All of this it is a little bit you know again.

Speaker Change #130: We expect to close the transaction.

Speaker Change #130: The third quarter you are correct, you know Scott here and and in December we would have a full deep dive on the strategy you know four four endotronics.

Bernard J. Zovighian: We believe that many of these patients, our failure patients, are patients we are serving and treating today with our valve technologies, so it is in our space. So we are super excited about it, you know. We see this one as a great opportunity, a great long-term opportunity, you know, to expand our reach as a company.

Speaker Change #132: We believe that many of these patients out figure out patient a patient we are solving and tweeting today without valve technologies. So it is enough space.

Speaker Change #130: So we are still excited about it you know we see you sweat as a great opportunity a great long term opportunity to expand our reach as a company.

Bernard J. Zovighian: Thank you. Thank you. We've reached the end of our question and answer session. I'd like to turn the floor back over to Bernard for any further closing comments. You know, thank you everyone, you know, for your continued interest in Edwards. Scott, you know, Mark, Cine, and I are happy to answer any additional questions by telephone. Thank you so much. Have a great rest of your day. Thank you. That does conclude today's teleconference and webcast. You may disconnect your line at this time and have a wonderful day. We thank you for your participation today.

Speaker Change #130: Thank you we'll keep thank you we reach end of our question and answer session I'd like to turn the floor back over to Bernard for any further or closing comments.

Bernard: Thank you everyone for your continued interest that all of US you know Scott's remarks.

Speaker Change #134: Will it come into your additional question by telephone. Thank you so much of a great. The rest of you all day.

Speaker Change #133: Thank you that does conclude today's teleconference and webcast you may disconnect. Your line at this time and have a wonderful day, we thank you for your participation today.

Speaker Change #130: Yeah.

Speaker Change #130: Yes.

Speaker Change #130: Yeah.