CVRx (CVRX) 27 Apr 232023 Q1 Earnings call transcript

Greetings, and welcome to the CVRx Q1 2023 Earnings Call. At this time, all participants are in a listen-only-mode. A brief question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, [Operator Instructions] As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Michael Vallie. you. Thank sir. ahead, go Please

afternoon. Thank first today CVRx’s joining you XXXX earnings for quarter us conference for Good call.

Jared and Joining me Chief Financial Yared; and company’s the Officer, Chief on today’s Executive call Officer, are Oasheim. President Nadim

The remarks including financial today, and The guidance. which plans forward-looking may are on time. as statements based about statements expectations will today contain statements, of change over

this including release differ that In due the to upcoming to uncertainties, results issued and earnings the could the materially and SEC. company’s those actual will the in addition, risks identified including with in SEC call prior several be filings, filed XX-Q Form

would Officer, I to Executive Nadim over Yared. call turn like now the Chief CBRx’s President and to

today’s performance, then providing Q&A. first conclude results call of thoughts our you our by review Jared followed to overview Oasheim; by and I XXXX before for Thank to thanks begin Mike, an quarter and operational our turning CFO, financial everyone for of of will update, an by the a rest our I’ll joining with us.

We performance, solid fronts. quarter multiple on which with are execution our demonstrated thrilled first

We heart quarter active from reporting at preliminary testament a patients the our many from failure. grow therapy ability continue Barostim increased capabilities accelerate on the organization data of U.S. physicians gain centers positive level, The commercial are efforts. is our high and This failure for our quality marketing and feedback adoption heart At business. their impact awareness and to continues Barostim to is suffering meaningful to traction. study during our life with implanting to through the able a share BeAT-HF the team’s of the to from of our extremely

was into XXXX. performance. business first first of quarter the million, the by of details the company’s the quarter $X top performance more far the increase highlighted of XXXX. quarter an The in than revenue worldwide Starting best line Now XXX% was failure in million U.S. the the with for of increase was over first our of of the dive month XX% let’s an quarter, revenue, our which $X.X review U.S. of the This single generated over accelerating March, history. heart by

revenue how the attributable is know announced is BeAT-HF much definitely unblinding the don’t March our over we of February study or the say we recent strategy performance can of in While our to commercial execution working. quarters, to in

We are trends strong these also seeing into adoption April. continue

operational Now expansion with turning quarter, progress the starting to continued an the update the infrastructure. during commercial our on first made we of

total added to XXXX. in territories, forward XX. build talent we We the quarter, attract to with upon that quality to the continuing remain new been X to bringing we look excited the and sales During have able quality of

programs. During and our education the quarter, significant progress initiatives, including patient first with direct-to-consumer marketing we our made

cost and We momentum will business. continue accelerating to campaigns to improve the evaluate optimize our in broader capitalize effectiveness rollout to these the on

data we to regarding Moving focus, the our the label post-market of with recently our on of to evidence, announced. an potential expansion of BeAT-HF interaction ongoing update body want expansion I our clinical our FDA provide following next area

label that from submission an the on review expansion. that started collected have process. for effective optimistic is far ensure data remain We will with so interactive most we their Based receive a committee, to FDA and is in that executive our way discussion guidance steering we designed our a

the showing coming expansion. positive any not our label growth significant However, a months. to impact reporting our assume in progress does mind XXXX over please look from forward guidance keep We that

bring relief in our impressive strong exceptionally business where growth, remain We performed help from first express in heart quarter revenue I to many quarter, failure. failure the had particularly up the thank and team want my to continued our patients support. We confident Wrapping gratitude everyone our their well. with U.S. to for heart suffering business to a

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

million, year. of XXX primarily the quarter, $X.X was in the the total generated year year. a heart about million revenue failure $X.X expansion failure generated quarter an to which business representing on U.S. on same of same continued of quarter, increase This increase last period last in XXX% Revenue period territories, the current first physicians Nadim. new XX $X.X accounts million awareness first in among compared the the $X.X was last million and compared increased current is patients revenue in the million and Thanks new of was over quarter totaled revenue driven In of $X total by an Barostim. to revenue the in or the Heart units. U.S. the into XX% sales units increase U.S.

At active XXX on December and end centers quarter, of of we the on had a the March implanting total current XX to compared XX, XXXX, XXX XXXX. XX,

current quarter QX the increase compared of period December year. end also of in same in XX at end XX the quarter, the X% was sales We in at had Revenue XXXX last million an XX to the $X the territories current on XX, of XXXX. the to generated U.S. and Europe compared

X of driven XX% the for in March current increase result revenue as XXXX. for of XX% unit XXXX had a decrease X ended XX, the the XXXX, of sales in increase – million This the a current Europe. Gross At period was volumes. gross current months year. increased per ended last same $X.X a XX, QX the compared the was XX% in quarter. of units the XX the the for Total March production increased million, And Europe of to cost months to from total quarter quarter, X profit $X.X compared to in in in territories to end we an margin primarily by increase

representing non-cash reflecting $XX.X expenses, million, stock-based for current compensation This current and same the compensation compared change of due expenses quarter due as expenses headcount to compared XX% stock-based the of marketing the of last well fees. mainly higher increase expenses for in were year. commercialization related development as period were expenses quarter last Barostim. advertising the to million, and XX% increases primarily This the to consulting non-cash Research increased same $X.X an increased was period year. increase was SG&A to to compensation an compensation travel and and expenses, driven by increase expenses expenses

account. Other was income net the interest to in compared of year. same in the of million $XX $XX,XXX quarter last current on year. period in was share quarter loss current $X.XX $XX.X or last $X.XX The income for the per period a compared driven for net a was our income to share $X.X expense quarter loss by million of interest-bearing XXXX the primarily per Net first total million the net or same

Net outstanding Net end XX.X average for current loss XX.X At of per million compared weighted same and weighted $XXX.X were average used quarter the million on to and outstanding million. for activities cash share $XX.X cash million shares quarter and operating the XXXX. quarter, equivalents investing period million last current year. for the the current $XX.X cash the shares was was based in the of quarter first for

million we facility financial debt our down our During further current to $X.X drew on also position. strengthen the credit current quarter, of

to turning Now guidance.

$XX Gross million continue and to now And between expect For and to of total between operating million. $XX now expected million XX% and is revenue expect expenses between margin we XXXX, $XX year we be the million. to $XX.X be full XX%.

report expect of $X.X between For million. XXXX, the and we second revenue $X.X quarter to total million

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

very are These Jared. CVRx. Thanks, at exciting times

and we to accelerating, working continue improve margin revenues as The exceptional our cash put, execution Simply to. is decreasing. expected are across to profile our our We see continues our burn is business. model

continued guidance successfully full through are created we We the gross continue and strategy build throughout the as full on increasing our have strong growth have year the April, margin see low to revenue of guidance. in the of raising forward momentum our performance end We year our business execute remainder XXXX. look and a to and to result,

like I open for Now, Operator? the would to line questions.

Canaccord [Operator Will Plovanic is ahead. sir. Please we have go from you, Thank first The Genuity. Instructions] from question

questions Great. Thanks the for on taking my congrats quarter. and

interactive how this low commentary on your would the your like then frame of are M&M high you M&M very questions. Can What kind going with there? your on a data. at and should are – for great discussion to from questions taking of be my end kind about One discussion the physician at that March, community you sure secondly, we the us possible? two really the And is the give for really thoughts Just if what just Thanks I not label any end? if or the FDA. for on strong going of us, the anecdotal feedback for was is think discussion data. you commercial that’s

you Bill. Hello, great from Very Yes. and hearing questions. nice

supplement. filing that. interactions with the two Let the apologies you is One me there for the of And with about PMA are ways know, question start FDA. as a

submit hear then and The first approach wait FDA. from is to prepare clinical report, it by to feedback the

The second assess from five key We in love useful they that treatment committee the for allow that still their made previously, We assessment. where now are with the executive patients bit to decrease the basically as us is I’ve And the of from suffering more pathway. of evidence in therapy FDA to it it this we our opinion, the is that, way labeling is treatment with interaction a a BeAT-HF second early a it. could said clinical FDA supports FDA, it as that this opinion would steering The to would selected totality that heart we of that labeling is do most to to augment optimize effect. a we’re after, little make opinion through the stated going leaders providing if agrees or report Whether interaction It’s ensure the right failure. interactively. that. information

the interactive at FDA. early phases So discussions beginning we’re with the of these at

question, the a is not sponsor In remind questions the do I yet. physicians a we here, while your a had with to trial, just are data answer as to we we can few we want unblinded evidence, to questions. allowed we’ve data. company regard interactions and All Bill, second everybody that of market and answering your since anecdotal the

widely. front may asks not we that cannot – question interacting working we don’t, M&M physicians So the with, if half be have The saying, the aware slow information. to due or I right the remaining provide of the have about going are data, answer in what And a have they this unblinding we range the slowdown stop in half, varies can say with they physician the own my any it. can don’t am me, patients any I’m the I of Barostim. asked Therefore, data. our not well, seen of data. disappointed any of treating believe either I’ve we anymore of with about physician seen to a with aware, we or data or information question, not the I what that is feedback If those now In are patients.

not negative seen that. double So this. we about apologies a have It’s

I so data far, been we very in to exposed I here physicians have reaction say So, am data. with the would satisfied for who the have that those marketplace to the seen the

Thank you for taking my questions.

Bill. you, Thank

The next Marcus JPMorgan. go question from Please from Robbie is have may you ahead.

Hi, this Lilly the is Thanks questions. taking for Robbie. for

second So, million, half take amount a and softer guidance raised been Street, had but we low than $X.X the which thinking. the of by quarter ahead – the back if you only you end that what of the implies guided slightly for

through can up there? thinking full talk moving And year why more? range So isn’t the you your

with Yes, question. Hi what your first Lilly, Happy this Jared. we happy we were saw take in is the really quarter. to

if of of strong results I April put that we’d we out call out something of saw We quarter. it – beat for mentioned continuing allow allowing that month those just quickly us into that’s just some few the guidance look really the trends seen the trends think some we results see just put full solid talking pretty we us part point. about one really too saw second that to had end the here don’t positive March, first we to and March how the trends after the of in that range the QX, seeing top But And some first or year Got April. we in Nadim continuing to it. the quarter. quarter for on want into a move after necessarily at to guidance nice

the And helpful. follow-up, a growth you’re does can versus ramping U.S. talk from What how the U.S. take for on international thinking about Thanks is or maybe it. it the much. Got focus internationally? get in to business about so and you foreseeable really driving future there? That’s adoption just the here

ourselves a asked quarterly almost we’ve and basis. this question, great on Listen, question

in We capability in limited and to resources invest hoping growing, limited right? here. what have So on need throwing world. We about judiciously and money sticks it’s the not

for would to calls, wide, reach margins I too without the but of here don’t in breakeven cash allow that cone not possibilities too is flow much additional As We of mentioned outcome. have previous money States. in return raising us best wide. throwing is the And now, in best United invest right marketing money and in now right for and us the hoping to the on opinion our it in investment sales

is States, situation Europe, it Now seeing When increasing our are change in growth different. that the the as spend right we countries, United dollar U.S., multiple in in the will future – any it’s the can States. now, we start right? talk country the the penetration But spending the United in we’re about in we with we Every U.S.

have about our have worldwide Italy, so Germany. We experienced Europe slower headcount growth growth. reimbursement flat anchor in country single decreases, our what steady only support the to a that in Germany actually, our their year each around was it a increased if and because Right it within we in ago even an forth. presence own focus became now, regions that we there in Germany, we’ve are and XX paradigms is previously maintain And like

the to sweet that States. invest grow So a grow value don’t added, we in the fast we it hit so ability it enough becomes faster we United have spot where Germany but in to now as right can that

our in investment penetration So in best is United U.S. and will focus for our U.S., low the for super short-term, we return future still States, the on the the the foreseeable as is

you. thank Great,

Thank you.

Sandler. The we have from Piper next from O’Brien ahead. question is Matthew Please go

one since Are you. same? this that kind anything the is about is what Matt. Or also, of utilization we Hi, you guess And getting on mostly Sam are seeing question is this trial. readout? on you Congrats for BeAT-HF Thank great a physicians Barostim announcement had of I since quarter. questions staying changed? then the from

Yes, Sam. Great question.

I’m So that a of with new utilization, in the of terms patients is here mean we assuming device. treatment

programming or batteries talking more for replacement years So the we’re about receive X who of not therapy ago. patients

a much barge, be with with of issued a which in super What our of have fantastically don’t So February de therapies, and to result great it’s we of the late that know And receiving patients both. novo that’s that strong XXX% XXst been and well, just and seen that was revenue, trend is Maybe a execution. in only happy in know approximately to of it’s are the press February middle terms superb April. release We maybe we’ve or around the the just in continues it. we growing can attributed correlates the we United a we very business execution States, done team. how yet data basically, We’ve year-over-year. we’ve

too slowdown. was this a is due seen to bit early stage a the we that a is acceleration all that can unblinded. It’s it not we’re data So negative. to we at say is double And the have seeing that say

kind And you. on getting Thank from you’re just last the what of then Great. questions physicians. part

reminding Yes. about question. Thanks me the second for

of segment. summarized the with question header the close right the it physicians And presented, The the all So the side of assuming the received had heart dot, our don’t points, I’m bars, chart which press one one endpoint. of That dots [indiscernible] to the THT we morbidity. with chart we actually and on in know the but conference. has that that it a other on but that was questions, of all seen data. I if that favoring device side data, evening that was you’ve Dr. wide the based the is that about same primary failure exception at component center on the largest of was I

of the [indiscernible] those one-fourth rate heart about we’re in for was chart, arm of we if compared with XXXX analysis, heart p-values arm, XXXX, presented hospitalizations specific same and consider led like have control there? the instead XXXX of symposium failure how other was numbers, of is years exist. hospitalization all not due XXXX. Dr. rate and this the And that the to year. in different If the from do but at of in the group said, the we if in into went XXXX very hospitalizations So well, his The same THT XXXX the that data are was filling would in failure. was the a at back a look pandemic fake XXXX What different us question, did not if any not right, year. what as We not existing other to XXXX the to XXXX ask

So additional of did at Congress German the at DGK known data. he the as data that Manheim, – Cardiology analysis, it and of Dr. shows [indiscernible] presented he concordance where

dots chart right but how such the explain all effect those question. the kept that a biggest on are on on dramatic Barostim. is that a that reducing So favoring side, direct and answered reducing the now of analysis hearing can to was yet XXXX That question – mortality not question that we from you data have the And morbidity. ignoring you’re is, you answer

would one that’s, say, I Sam, feedback, summarize it if I the – there such. as was would So what single

you much. Thank so

you. Thank

is William The Blair. from Margaret from we ahead. next go Please question Kao have

congrats the DTC Margaret. Malgorzata is This one [indiscernible] campaigns. Thanks for strong guess and on on quarter. our I from taking the questions on

and of testing You’ve obviously variety different monitoring channels. mentioned a you’re

and and if following So you’ve increases kind awareness those what just those just wondering of results readout... following any seen and notable from the

direct-to-consumer efforts again. you from we’re great on data we appears was Listen, results very seeing the new with paying based that And opinion, to quarter. our looking be implanting our Nice the in [indiscernible]. you question It Excellent to last the in started month. the first Yes. that at, but only we we centers. happy we have And active expanding saw where to geographies, areas hearing off. are

in with drive happy of effect DTC results utilization. to super are the to We saw in April the we regard

In channels. of testing terms will different keep new channels, we

know, right Facebook. we present You now, are on

We Google are on AdWords. present

I in be those from those happen age your and having friends, But TV details. not on somebody you many We you heart to to this are going has this possibly suffering present certain be to you ads. above you one if you or am some to shown failure in have go a through area, similar family your in channels. or of probably of if Facebook if symptoms, happen symptoms

a then that’s there trial, And could the how give color many just enrolled? question. patients? follow-up XXX any taking quick if for Thanks. BATwire have Awesome. sites there adding bit been how wondering patients progressing and potentially more the on more in on detail Just of is you get my more a Thanks could we on estimated

will we BeAT-HF sites that comment can stage, the adding that at The and with focus and are of team at at I the data stage. morbidity filing mortality, colleague, and analysis – are is particularly clinical taking supplement, our very this moment, is I the not over Yes. the we say on is data, PMA and a the my Right team. of FDA anything CVRx, at else. discussions small all this our this the precedence now,

the couple release. not the continuing best of been in that we months. include the Now do will next to BATwire it quarterly update our is has in provide, have to but any past focus If we our background, in

Great. Thanks again.

Thank a Have you. good night.

Craig-Hallum Please Group. Nowak question go from we is ahead. from Alex have Capital next The

BeAT-HF, studies, want to obviously, upcoming the going do the it guess Great. will afternoon read do to going Good good you and And whatever out, focusing FDA. go with off BeAT-HF – What’s ahead I is wants do here to be But being your or there. to continue want But last there. is want team submit the other everyone. Okay. to now, to question small go to I and do what getting FDA big, next? green-light to on quarters? that in

you, Hey question. great Alex, are how

do post-market that we our is another yet It’s have study asked what States. unless post-market have we it We us own initiative. large is now, that completed Right currently registry FDA past. have in enrolling Here in BeAT-HF. to And with be the study, disclosed currently will just still to cost number is overburden. shortage. if don’t the the a do where here possible called create know we additional our rebalance. And want be to don’t over much number reason. try to to And burden data staffing we within we one. hospitals as an they collect Obviously, That’s the CVRx on two, want to objective as have United

that ongoing is registry speak. we rebalance So, as

we submit academic CVRx. is door up institutions an Barostim for with element have study a a to to who request opened experience second investigators The have to the at

program, the have some We it’s Barostim of Research. independent BIIR, We if at positive, with the and of merits that an we help adjudication the study the looks these. committee funding then Investigative call Initiated scientific of this

And topic. a So, those pilot called say we on the program. in in XX happy we is finally, at projects program of cycle and to proposal BATwire. question I is elements. just a only by Xth. accepted to ongoing course, program in at. then FDA was answered And year I This this this project’s life They am accept would that January up FDA, phase our cardiovascular. which got advisory are TLAP, program previously the accepted have the new total on been have

first within So, pilot project I the are that. believe we

are are trials. require It’s a analysis obviously that after. bit we the We going phase. looking of at market in would This expansion new early the

of and work future stakeholders physician groups, or forth or to conducted societies be patient so will the groups the stakeholders. for that and have with programs designations advocacy for as working the all recall, if breakthrough that FDA payers are or which ensure FDA. hypertension very of for essence And we of that a is sponsor the is and all heart The patients have answers and We with essence other of only failure, or the such ejection It other designation. TLAP exciting. is fraction. include requirements the intriguing to program the TLAP trial the preserved And promise a side is the of you of physician breakthrough

don’t would with little it’s when is work this to have of still appropriate a project. It trial. the decision stakeholders to we trial, a Now, CVRx We bit invest early. these months to start and a for of then will It make a time a yet take all plan trial. in design is in to have a here

a now little the you to details premature it to the bit is CVRx right to of and everybody are the is discuss details happy of don’t yet topic. been But has because very trial. trial pilot excited So, stakeholders are I else of as super we this here we this and selected disclose the know part having with that this project on with FDA with we with FDA, and interaction weekly other the am

of Okay. are regards comes What Very that. timing that the to to label of as what excited know far BeAT-HF underway being discussions internally designation. expansion? the now for the submitted exciting, breakthrough is FDA, With the I latest to hear submitting for package

that road do. It is the are XX following, months assemble a classical three or say, since already the supplement, it’s takes seen to year to I case, it and the to usually FDA. company will Usually, companies have taking X PMA submission would if one it is we a months PMA our depend. approved. In product about submitted

to good of their provide traditional it. to of So, months more three and on six way, report it. months we post-market the a are be focused feedback following the then clinical If FDA would on it’s seems the The have approximation. phase

year So of as think being end the Alex, situation. of it,

FDA, upfront we process more faster this the may our with are predictable. as will that more time review in case, we hope by and FDA be interactively Now the take working with

Understood. like you was did one in Okay. big looks for issues up may supply just about some are would just pretty you That step mention Jared. more for chain what It that you sense. ready The makes demand. inventory, And worried clarification getting for? be or then

inventory up could was step cause there? a of just So, the what

Thanks the Hey Yes. Alex. for question.

more of and trying that jump up up Part inventory the in inventory to the with see question MDR goods XXXX couple the in in that here on So, came the were this from industry building towards we getting get finished deadline into some was that obviously months, Europe some MDR. that some the of We marks end lot Part updates with finished the weeks. was over us did early of a year. of a able of the over through XXXX. end couple of of that can of around to last up kick

of it it’s part out is We then were of a So, the a We build concern shelf. supply lot supply goods. to there. chain, that on And less right. also finished just of able had

it some if the able are that hurt we have more so doesn’t goods is available sell So, to units to demand there the there.

Yes. XXX% update. for makes sense. the Appreciate Thanks it.

Alex. you, Thank

from Thank question final Markets. we Capital have Takkinen is you. The from ahead. Street go Frank Please Lake

couple questions. strong to the with of maybe of have evaluation two March clinics three out wait may for used technology a dynamic comfort called and out, wanted may additional post from months patient treat you the that are facility a in months taking play first for Thanks guys one reinitiating that Did past, you you bolus spoke six before that and patients, Hey. to six-month getting three-month – that the one there. utilization they at follow-up to months, April beyond pools? months I patients the with and or more have where on the all question. treatment going then accelerating to period, within In the in their

Jared. is Yes. this take will Frank, that Hi one. I

more have We active centers that same are point from for I than months. of we seen more groups. with of of XX now think lot those being a just or same the is have that types more being reaching what us for

a that’s these almost month we they patient treating we as all so cross that pushing one that seeing are And that to sites average. long-term reach. threshold, them goal are And on of

new that seeing being the us. into few longer So, patients, saw other seeing with are and April, more and also March then they is first in but the to those treating treat growth of all I sites continuing think continuing we those more activated, sites

one. for And helpful. Okay. second my then That’s just maybe

to get could doing is is anything submission, the the it’s be assumption how of going start time, the once As guidelines guidelines the through about the label data, you it can with in my relates to we to expansion? FDA, be At expansion. communications, any you positioned same the process and conversations communications label there BeAT-HF hopefully, hopefully, FDA within go having the

committees. is provide little thing Yes. any have very do influence proud guideline interest. only companies guideline committee, Frank, peer-reviewed data excellent the understanding, with ensure general, seen sponsors they manuscript that and to independent with them. the be is guideline committee In this an can the Therefore, super question. has of my trials without are the conflict in the of The that

is no allowed are there with here that, lobbying that them to published. limited e-mail when manuscript manuscript sending just is the we the and is an So, before

Now, made just – here I more give I your little question and enough. I color. and in I I reiterate one that want that to point, bit make want a answer to Frank have don’t think to sure

no us Our model lack that cash label, of us on more by to we be getting reimbursement. anything what has get the is can super the additional today a to labeling our is needing have. this and we This about additional based in payment and the not path have confidence hands means flow point confident on same to it’s about based current else in and without breakeven being our getting us cash with profitability raising to but levels said model

our or flow expansion our will we hands, and clear us upside, this in flexibility an investment be we opinion, terms what get to have that will profitability. label we a Anything in to future. get today above So, have sense, breakeven of more in our based i.e., Frank? Makes path allowing earlier on getting to us cash on the

perfect. That’s context. taking questions. Good me I Yes. the appreciate

much. so you Thank Fantastic.

Thank like you. back Nadim the would over concludes to question-and-answer Please sir. I session. That turn go for Yared the ahead, to floor comments. closing

update. progress Thank our you, ongoing and our forward call. operator joining quarter we night. look your our on us and to appreciate everyone you on earnings updating support, for next thanks Good for first We

joining you, for that concludes today’s Thank us. Thank then and you sir. gentlemen Ladies conference.

disconnect your now may You lines.