Nyxoah (NYXH) 14 Nov 222022 Q3 Earnings call transcript

Good day. And thank you for standing by. Welcome to the Nyxoah Third Quarter 2022 Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded. I would like to hand the conference call to your speaker today, Jeremy Feffer, Vice President, Investor Relations. ahead. go Please

Taelman, Good to Michelle. of good everyone, be evening, Participating Moreau, and Thank Financial Chief earnings afternoon call welcome Officer. Olivier will today our the quarter Executive for and Officer, from Loïc you, company and Chief the XXXX. third

found review a release US call, Investor today, markets be Relations we website. and after our the section question-and-answer Events financial press quarter on which operating discuss the of third section in be archived is results website, host session. Relations closed can The this During and our the activities will being we'll of will our Investor released after and recorded our call

events that trends, expectations events, uncertainties based those relate upon risks of future cause statements. actual Before our statements assumptions. or All these by involve statements results or current predictions materially and forward-looking to remind we begin, estimates I statements like and or could market would that or are are These to implied forward-looking to forward-looking differ performance statements. material any you various that results anticipated from

Our forward-looking and to company should information, these currently statements upon obligation statements. you reliance no not based statements. Accordingly, undue on available update place assumes these the are

For over XXXX. March business, turn to to XX-F a filed on the I uncertainties please list with call Factors Commission and and of that, our description XX, Form our Olivier. of and would refer with the Risk associated the risks section to the With Securities like Exchange

of us good for XXXX for quarter evening, third Thank everyone. you, And joining And Jeremy. earnings call. you Good our afternoon. thank

XX-month US to in data the we in XXXX. of that verge on study, to remain And fall third As we our DREAM. of have are track report on closing an I'm clinical the quarter, happy implants pivotal overview

remains robust, trial for have as exiting expected and new XXXX implants This in opening confidence or Germany concentric growth market showing Commercially, Genio before patients, demand year-end. US keep commenced our collapse leaders complete in We with in also sites. for of ACCESS CCC first reconfirms we Germany.

fact-based in data with have a our completed with From begin to will regulatory implanted submit generating remainder of start plan clinical fall. regulatory modular PMA coming be modules XXXX. first in clock to our This QX fall. the our weeks. approval timeline efficacy next second first the to of having DREAM achievements. a Let's perspective, date, the in quarter to of trial, we summary of XXX we the To the We data prior three patients XX-month next reiterate our

We have year-end. begun implants activating sites ACCESS and in to initial continue the complete pivotal study collapse patients on expect our US focused concentric before

option the treatment Genio demand total commercial bringing Germany, sites. in other during quarter, of sites who As commercially and therapy contraindicated a CCC HGNS nerve stimulation who XX eligible approximately no Commercially, active third to hypoglossal available Germany patients for reminder, patients new to our than activated OSA have currently are We represent remains in treat US surgery. six major the in suitable to palate XX% high.

shortly. sites our in trial of That very inventory with component of quarter year-end. postponing were this impacted issue We Germany. active constraint. a availability will said, never expect That by DREAM detail a to at providers, strong The due XX constrained I fourth which inventory up one supply us was we resulted temporary to in by US

as team has we below progress made our result, a reported at we demand. of well is purchase underlying €XXX,XXX, As remained orders reflective of open additional €XXX,XXX commercial received sales roughly not This that the of quarter-end.

sales, quarter. have orders with since were supply Notably, combined quarter reported orders vast majority open the and that estimate the remediated, constraint, open second be been third despite and makes XXXX the has see remains What issue supply filled. market Germany. the been strengthens the that confidence Importantly, demand This of in the even leader QX with happier me our we high. the to remains to is our exiting in share consistent

second review of in a the with our study, of with first XXXX, remain our the XXXX. start from ID fall quarter remaining implants having with five me in and implants, the We regulatory the and studies the to track we pivotal clinical update have next weeks. of two priority approval US, the in of data In scheduled few XXX for ACCESS. let study the expected completed on date, XXX XX-month Now, DREAM the DREAM of

process. are we As pursuing modular previously, a discussed PMA

the in begun already approval. first US In the upon to preparing reimbursement market ensure our it meantime, are anticipate module organization early investing in have XXXX. submitting and We we ACCESS

for we ACCESS concentric study complete collapse As activating patients, now clinical are sites. our for

OSA following to label, nerve after reminder, hypoglossal patients, up will we but Genio option sites hypoglossal these for OSA patients DISE a longer to to DISE, already providing the less a patients surgery. for implants getting stimulation physicians represent in be palate patients the not a endoscopy, sleep complete need since Genio invasive the patients a to no US, treatment have CCC approach all to anticipate nerve patient's an failing much reasons. stimulation we clinical therapy will still a the demonstration procedure. to no As to CCC the for is path These by therefore, procedure all from CCC are We hypoglossal and CCC currently of patients therapy, determining before but for will first also who hypoglossal only and Not CCC. we're CPAP diagnose a and nerve up across within the population, initial we be any plan contraindicated DISE undergo currently streamlining of induced US. are This stimulation stimulation XX XXX or only With where year-end, drug patients, implant all to for no prerequisite major the implants we eliminating need their a treatment obtained expect in the ACCESS eligible CCC year is therapy. treat are or a CCC longer XXX to nerve true in indication, eligible to for Europe, only option XX% In benefiting for our already implant.

database who have already of screened because a CCC. we of DREAM out they patients First, showed DISE have

XX Second, enroll more activate since to patients we will opportunities have sites up for versus to DREAM. we XX will sites

no efficiently to patients enrollment alternatives move used a funnel to DREAM the from these have nerve great Third, there will for for learned to so will all and competition stimulation the Four, are there home we cases. from be sleep no deal to be tests patients, patients, CCC qualify more way in how hypoglossal implant.

to half the We approval expect regulatory first XXXX. continue in of

from expect we So, roughly the after year DREAM. approval non-CCC one that coming

and to Nyxoah compatibility, to we bilateral continue clinical Importantly, with team and or pulse system, within the for by great EMT more clinical followed physicians which than sleep we Nyxoah's who story. is and work includes patient-centric the in full evidenced generator, AAO body entire very the enthusiasm as XX advance we interest growing would are lidless as closer move I our the was Philadelphia the This platform approach, MRI September. symposium in community stimulation, US focus a like thank resonating surgeons Nyxoah by community. to Congress non-implantable at scalable attended their well commercialization. execution on a generating US HNS

XX launch, outside same European price of dedicated second Germany. and and in priority, team the hypoglossal largest market sales marketing Nyxoah stimulation nerve similar DRG, hypoglossal to reimbursement on is our most at as technologies. a Moving primarily the United the the to commercial German people knowledge and States. focused level other competitive Germany point stimulation of has and,

success XXXX. becoming leaders market We the have defined end our commercial of by by

during quarter, sufficient supply we bolstering temporary our has manufacturing to our To experienced optimize meet Europe, As I suppliers as chain with this solved. supply site disruption we of a components in a in have and malfunctioning quarter, further a mentioned Israeli been our demand. capacity machine. one third capacity earlier, had second Belgium are This the

manufacturer. the however, very being third quarter. report said, process availability we a strong, a inventory production confirmed of we That the are about the purchase Underlying with demand, the in during of Additionally, deferred in to of line €XXX,XXX fourth with therefore, quarter, and Germany, adding well-known €XXX,XXX. orders of US, in remains contract sales third commercial postponed

any I plan on not I the that do think provided any show is for to While dampened has guidance, it providing important supply never not Genio. fourth issue guidance, since demand quarter we quarter third

patients for not DISE, have Genio they both of include solution to label to for drastically shortens because patients they as endoscopy, to concentric removes opting collapse, sleep induced physicians, for do desperate the OSA. thus in perform are positively between and are physicians their burden This of access with Genio a expansion implant hear a diagnosis impacting We drug complete to or continue from that procedure. and our patients and who suitable for need time increasingly the

We in to accelerate waiting enabling launched to HGNS used patients, called AcuPebble present on a will the end, and Wiesbaden a PSG confirmatory test will titled them pathway also use to a receive for the existing we access program to the Sleep to will without the Sleep on how website. be Annual CareX sleep Apnea event in solution. from Germany. it an Society Obstructive CPAP Genio German confirm To six home This event Diagnosis National AcuPebble our for implant up CareX to an prior this is are and PSG. months to hosting webcast tomorrow, around Conference information Treatment. thus be

in we of commercially outside have where we in markets Switzerland quarter, this at DRG reimbursement, implant place. Germany a full Looking including patients

position in in establish strategy. first patients always leader clinicians our an We OSA to putting R&D continue and space, as innovation our the

As improves stimulation existing for next we scalable system, to hypoglossal which approvals implant another remains discussed patients implantable advanced procedures their the most need undergo and, regulatory always to surgical the have generation replace not which for and only we features nerve comfort Genio the previously, X.X surgery. received the patient component. have to therefore, with compliance without allows Genio implant have

experience. generation the the the implantable stimulators are also chip developing We of both activation improve to and future patient

working For the implantable on life. for implant an stimulator, we are

As will become We chip, activation physicians' and they feedback and further progress. the provide more integrate will design ergonomic on its developments for updates as these patients'

Vanderbilt project. the Nyxoah on collaboration you cervicalis updating ansa Now

a With and to to patients. OSA product prototype update. towards offering by CFO, efforts non-responding a updates. solutions processing expect mission Loïc severe who to provide over to providing periodic forward current pipeline our Moreau, study enable expand We that to us our feasibility turn will hypoglossal a nerve look build are XXXX. market and patients stimulation the in to moderate that, will These call I'm to We to pleased non-eligible embody commence device a financial the

XX, September and Good evening ended day us today. to XXXX for And €XXX,XXX. joining everyone. Olivier. for was third you, the you Thank good thank Revenue quarter

mentioned, As quarter the and implying XX.X%. third filled was the of by ability the was already Olivier been have majority vast disruption in of Total meet temporary for third gross impacted €XX,XXX, quarter. open that The limited our issue the of supply to cost sold goods a margin remediated, quarter revenue cancellation. XXXX a no demand with orders has of we

gross programs. Selling, rose and the €X.X mostly commercial quarter operating €X.X due million scale. Total As the XXXX neurostimulation expenses general Genio. R&D Germany due of €X.X line continue XXXX, from to research continue a commercial quarter line €X.X on to plan primarily as other generations in reminder, XXXX time, efforts in we focus the million the of in to million and expect companies administrative and third development to to third over million quarter development European third in other in increased were with greater margin for in quarter, as expenses quarter year-ago third with we of to markets. increased our of we future expand the achieved from

investing to commercial and of corporate XXXX third for operating in we up third in driven the our expect organization, spending, was also loss quarter $X.X our R&D We the third the acceleration particularly million and versus by clinical capital XXXX, revenue, and as activities. delay the added US infrastructure, commercial further in quarter quarter our of scale the continue $X.X our to million Total headcount team. our in human

XX, of foreign benefited and €X cash tailwinds. As cash financial December burn third was million from Monthly around compared quarter, XXXX. on September during total XXXX, the totaled assets million €XXX.X exchange to XX, which million €XXX.X

our direct going We commence continue the and ACCESS the marketing slightly the that, efforts trial I to forward increase expect burn US will call as in patient to turn back Germany. With cash in to we invest Olivier. monthly to in

we during responded you, extremely Thank how we how Loïc. are it. quarter the faced strongly challenges and of the executing coming I'm the of proud team third to out

the XXXX, DREAM not in strategic XXXX objectives, regulatory our quarter having the a on German XX-month this data are summer; As I to concludes key achieving to you in session. part the of our fall leadership being will by ACCESS over Q&A we patients of year. our our implanting formal and presentation. result, changing begin turn clinical the any before of end This the available Operator, of call expectations our approval resulting

Our Instructions] Adam Maeder comes with Sandler. [Operator first Piper question from

This for Simran on I chain occurred start the is off to Adam. during the that want supply disruption quarter. on

manufacturing taken So, does that occur? What mitigate the supplier in sounds sound expecting when like have should or the that steps we source you does that be second of prevent And found? like to from additional terms exactly it kind it capacity. you And guys occurring. of

even capacity perspective still puts forward. of about or we the in back shy so. by QX Street To there, the revenue should guess unfulfilled a on I going So, we follow orders, from expecting that if be €XXX,XXX what

the then to you progression maybe quarter, month well. headwinds organization or the be of that'd trends the So that month, in and can commercial in in talk elaborate on as about great field the seeing just commercial the you're some

by answering. Let me start

very answer there up picked – an it's you're suppliers. this when inconvenient was of that facing was that question, with sub August saw To we we through. something course, one Of went issue our of it end your

resilience important solving with this. a the also team happen. road the of in company, I And think I bumps shows how their growing more think in can kinds those fast is

So, can our it this, think the that thing we saw confirm therefore, is quality up. system the I immediately I moment picked positive

would to supply. That solved this, a is this one then we Next, I we new, this. not the sure have and started on issue. reemphasize able On making we to top And is but rebuilding significant were thing. and that like of

site also have Belgium we Next the to plant, our passed Israeli now their manufacturing successfully manufacturing that audit.

make manufacturing that meet and this hope increase and demands, So of sure the that and sufficient all that we forward. going have question. commercial stock I build will definitely clinical capacity answering the to to part first And

So, your Now that where the next third see is I'm are hearing what total, saying, on quarter? yes, revenue for have the we you German expectations part that in about X we quarter, we fourth quarter. demand. scale the our market is procedure was the in showing despite to market the And of the reported that deferrals that share share consistent the second with

were during comes any it consensus. the What guidance strong the have When gave that that so a that we still are still with thing. of doing more think we lot. we top or a we therefore, analyst three, we confident feel never to that, the Street the saw I'm I expectations we one back able too that's XXXX orders in and less exit also quarter Without expectation, of guidance, quite this So giving I QX have and not to very answering filled line can on we will quarter, this. can say is that

A expect QX. our be with issue. in fixed to consensus. We So the line analyst strong we XXXX

shortage that had We in that POs we we that were the quarter open also three. standing the and have backfilling

there. finer Just your on to maybe a put point comments

I QX think seeing call. about to in million I'm prior revenue €X consensus this

that we QX. the think So, like unfulfilled account that kind does still should it to of of about in right orders time to hold Is sounds one it? expecting that see into be also and should way take this bolus

Yes.

consensus confident keep we being the want is $X that up for still feeling to reach. our QX million. numbers, Since in loss that And So talking we within there, we specific the are want very is pick this you're XXXX three. to quarter strong. We have very Street

understand of had change Germany was the a guidelines navigate how the that forward? CPAP in and could an we going I set that this And correct? was there hypoglossal with appliances between us guess business? Is you question role and stimulation. and more Like, level I you details? where can continuum, specifically oral care impact dynamic to another fits And your you there regarding to the that into have nerve seen

In to impact all seen this of business. any honesty, our we have not

comment. want at it's very know I can I all is impact I from but see business a did short that to comment, any not our we this. So,

if could one squeeze I just last in on one I here guess DREAM.

if coming implanting I and to timelines, expect think the the the late the you weeks, put a I about finish timeframe. you follow patients, As in of said would up kind November, all think XX-month December you

the in of finish would work. So all data terms that of clinical like does event XXXX a you sound late more when

QX So approval, does regulatory XXXX seem a that tight. bit

reaffirm timing walk to maybe confidence that your here. just So through timelines us the and

end data First in so XX-month XXXX, November. fall of all, indeed expect of we

an As you open is this label study. know,

we time. monitor and to to track, real are to in able analyze So data

data therefore, thing. after will we So, set reaches That's the very have months. final the patient soon XX one full implanted

we think modular that, of where was add timeline also talked six should have be months by then regulatory reach that by approval this, module first November, animals realistic two already us top or are the the where we efficacy we three on be about Now And really quarter And a approval. after end to we regulatory only the PMA, saying, to we a by opposed, in of that this. the to modules seven to November time expecting that need submitted so I the XXXX, brings getting to the FDA. it's and

from Our Block next Jon with Stifel. question comes

did first slowed talk should can the the what's issues think pace you If bit it impact implantation say Maybe not, XQ. just one, about pace? not did inventory enrollment I I which just the pretty were the on you in maybe clear Olivier. Or DREAM, little a

couple August, months, four might like to be fall six eight think in call away? you on even I a it It to closer take. you or was give think four it or prior weeks. looks thought XQ I months maybe the might

So Again, the call just a anything by market competitor couple is of right. if of terms out or to centers? wise, slowed really there slight a be issue, supply at it the out doesn't what a would, months in but you to caused to seem has down that push,

First in let of issue study. confirming all, me DREAM there any by that for inventory the US start never was

up well. So, picked you that, very

slots, few one I'm other question, earnings your existing we dealing recall, implemented you time the during last capacity. our or sure and was over scheduling calls, One that to last solution major answering OR bottlenecks. OR with two PSG bottlenecks. the identified So, we was finding months,

PSGs Now that the PSG centers, the and private addressed well. slots, working for finding we and out by to with the very bottleneck sleep work seems

Now, competition when very a is comes you a OR to just Because quarter competition, in have three. finding yes, positive there between to Inspire. a they it plan, I also and us quarter is had there admit, as heard,

We clinical sites, of a we impacted were overcapacity with an overlap perspective. our have and lot from

implants Now, of the out perspective, that in also we XXX. this putting XXX the reached right

The and five what We are other missing five will look they or know be patients, and are identified. like. the we dates where the OR will they know also

think they we data. I did identified. out already, also will XX-month of And clock the can in XXX weeks, the and the five start coming ticking very So for XXX, then well be implanted,

better from the et you you're a that close effort so in sleep, hit do just can what another Maybe set maybe, What question, the US? really is if of guys to hand, market commercialization, of anything? changes, commercialization And cetera, US running. player, the to way about a we to the here there eventual in efforts, number any if sort to all along when if think two papers to you're publication you're or change papers, second ground and when the from to for pivot for [Technical Difficulty] go you Olivier, strategy there your you're strengthen

the of confident we after we're based First on Difficulty] will the Inspire that be on feeling two all, [Technical the number pretty market.

one this out. point me Let

how preparing? Already preparing are US we Next, are we strategy. for future

already to already we payers. intensely As Medicare. director. access reaching out I working with She's She mentioned, hired market very a together is

kind CPT and of preparing really the she's we'll also on So out using. be what laying codes already discussions

done work part all the this point has to at we already So where been going are is today. this on. of And

further months, we on start coming would talk will would building board identify our having find investing and further start like the hiring type commercial preparing like leadership, in commercial the structure and can over that would like out we sales and looking where that will we and even Next, where those can people hire, we by be we and already so look to to in of also reaching hire, this would which talent. people what profile start you

that to we enter it's for only second paved sometimes the that comment in that's nice in I how way can the the that benefit already well. second And hypoglossal definitely thing this with can is to because nerve how and thing be XXXX. the expect market think So, rest, you to as payers, can somebody stimulation from we and the introduce

team starts So, focus two do and today, on sales by of we market a in five regulatory making people done, having hiring implants needed is build quarter already before, last approval clock our sure ticking, by that investing getting also all the XXXX, the getting to activity then access leadership. started and proactive the somewhere in

Our next comes Cantor from question with Fitzgerald. Osborn Ross

progress. Congrats on the

So have able there many Switzerland, for maybe active you how sites a now? quarter, the amount are of revenue significant to you looking accounted disclose it given during at

Germany, mean? Sorry, you in active sites

your curious, Just of Switzerland? level In there. presence

had add And Germany, we we expecting quarter implants. sites. active had are one that In have in And three Switzerland, in – three, more. XX active site forward did we we to going

in X Switzerland. So Germany, XX in

one going in we Switzerland. are up XX four in QX, For XX And up to from to from Germany.

how in are Belgium, Italy, Spain? conversations going Outside Switzerland, of

France help you know a have reimbursement. But we stim only this can where as that, will also say difficult we for activity, Finland example, some we on we And nerve When Outside that did it can I France. only well. case have for in where have we of Switzerland, to I us building have applaud know reimbursement. comes like in because market French, Spain also the progress in Inspire I hypoglossal definitely introducing our such that

not that will moment. where submitted do in there, months. there, also have reimbursement anything present but planning we be stand ongoing, activities also Belgium, in months coming but don't have for expect XX In perspective, XX we a also file, a reimbursement the the we the that's from seen And in Netherlands, XX we the we to we expect So coming there.

comes Oppenheimer. next Kalia from question Suraj with our Out

is Suraj. Mike XX centers to just on driving the more up the for guide over for a confidence gave at or was centers picking your novo theme, play Curious This on what company over existing centers dynamics Genio or German to bilateral XX preference de year-end up you from the growth, and stim? any there

saw in momentum XX We X over Germany of a last lot the to months.

an lot such Genio were the nerve presence, increasing sites a beginning interest a saw our with in really technology. that of us, approaching that had even stimulation, with while honestly, conferences, not with presence specific at So, starting more in increasing sites high that starting and we aware Nyxoah, starting being we, of of they commercial hypoglossal

why we that explanation is sites. number increasing the are our So of

there market, the German overall As penetration, you total know, the low. also in still is

I in also sites the beneficial continue more are more market volume, have the So, and think growth. high enthusiastic more strong that deliver on showing can a this that patients treating will you be

at share it for believe, German XXXX have the the XQ. mentioned where targets here? end was you be might in flat XX%, know of Do with sequentially I you I the any

saying team. German as this and in market success I myself and strong QX And I an XXXX next we exit certain very get-go when saying where we Germany. we And could that market exit are did accomplish be we to you leader are share, at call, would point. earnings this, leaders challenge this is this we extremely in a we Because confirm want from see will is hope everything to to really this my as really that, QX, are celebration market my We place. it answer of up German our can to do and not will during your because we still this very can for a our Today, your really this. question be commercial on taking, defined strong performance. team question be German I Germany, by changed. proud that taking lined and We this, I'm the roughly like question if in XX% the has extremely there

thinking that if is labs? how possibly today wrong, staffing volume? go are Or impacting Just PSG so, is about any procedure it? shortages that in could what impacting the field And

From also lot of a a staffing you see perspective, there, momentum.

So of today XX Nyxoah that marketing. we you program have we we directly undergo they existing solution and are have fact, give to okay, guys, than that to we and have to to will, we this are in CareX have validate, dedicated a saying, that test In this, a offering reaching sales and us, this seeing mentioned PSG. in German that both sleep to PSGs centers there are order at you home people out. shorter patients rolling when to out to to the I also people, using program, out started Like reaching we're with pathway Next us course, a nutshell, I So, Genio and are are what really investing, CareX sleep in excitement? hiring also this moment? think also we find wait the is that another this? physicians and

we are investing. So, really

We also in helpline we have invest place. now that in the

them also their seeing together we're that ENT our are referral with also to in We strengthening working surgeons next network. that

and, course, also resulting these that in continue will strong Nyxoah and very investments growing position. all that of the and we confidence making, leader Germany will has growing that really are market us continue given So,

to guidance you If we but saw? I might from could saw gross last similar one or in I cost component XQ squeeze disruption here general, do kind margin don't of any in just XQ you Loïc. XX.X% realize be or we see pressures other supply give there numbers question for at the XQ the

in in out, XX% we terms pointed margin, QX. have you As gross of

We this with fairly at gross expect in building additional to stable the moment. are the remain we margin last quarter volumes

adverse in we disruption we don't the QX. supply gross margin impact So, had from expect

production of quite are resumed And batches. in have we terms and now We quickly. up catching

like remarks. for At no questions. this Taelman back to turn the I now time, I further Olivier conference would showing closing am to

you. Thank

So XXXX was like through, saw fixed of for We inconvenient, And all. we in we you saw make conclusion we data and you thank I issue getting in for the clinical approval fall showing in but changing that decrease once also by it, the to and joining not study. all our again, regulatory went feel thank would DREAM It in at is your no solved all questions. manufacturing We see timelines listening US. demand traction confident our we impact, we it. the great The any in in very no that

very We in strong QX launch a expect in commercial Germany. our also

So, also there.

I again, team. once the only So, thank can

We QX strong to our during forward and all. executing on will continue the Thank you next are quarter earning looking call. report we

today's Thank for participating. concludes you conference This call.

You may now disconnect.