AVGR - Earnings call transcript Q1 2019

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Operator

Good day, ladies and welcome to your Avinger First Quarter 2019 Results Call. All lines have been in a listen-only mode and the floor will be opened for your questions and comments following the presentation. [Operator Instructions] At this time, it is now my pleasure to turn the floor over Matt Kreps, with Darrow & Associates. Sir, the floor is yours.

Matt Kreps

Thank you, Kristie. for today's all you thank participating call. in And of Avinger's first like to XXXX to all welcome I'd quarter you conference call.

are Weinswig. website Relations. released the release Joining Financial under March XX, the Investor today Avinger's posted copy Soinski; ended, Jeff us of A and first Officer, quarter Mark financial on Earlier its Avinger is XXXX. today, results for CEO, Chief the Avinger

are statements you statements that call Before historical as without Accordingly, forward-looking the and should management forward-looking Private financial make provisions of anticipated by to events we from those statements statements involve in Act statements. of begin, securities on All these our material undue not this forward-looking these future I'd of XXXX. or materially implied cause various Reform reliance statements made the contained results differ These federal uncertainties based fact could statements. statements. that of place our be this remind include are pursuant within assumptions. statements, you not upon deemed risks like limitation, actual meaning forward-looking during be the to including that current which that Safe call Litigation to should Any will and laws, Securities estimates or to Harbor expectations, are

Avinger and otherwise. to turn to Commission. see to business, of information, projections forward-looking For over XX-K because or required like a Jeff. Exchange list and new by financial any now law, and or events statements except the or update description and obligation, uncertainties call any revise as the our future Form please Securities whether I'd filing of with our intention the associated risks XX-Q or with disclaims

Jeff Soinski

and the how all was balance reposition Good Matt. expanded disposable truly thank with our expenses, for fight reduced innovative drove and to discussed strengthen year our and On you, focus the product tools disease. sheet cases, Thank last Avinger. growth a operating of on call, artery higher We we total in company line sales, progress for joining significant margin the XXXX you peripheral against us. afternoon

that at We of and include, utilization sites strategy form markets. in the also These going strategic first, current five in forward growth current driving XXXX. discussed our goals pillars

Second, areas launching new sites high in of with rates underserved PAD.

cost through lowest products, CTO time, including control with our submit to level operating improved year. new these this next Third, years a new in At proceeds our we clinical scale we and lumivascular We goals revenue compelling and data clinical Ocellaris our addressable demonstrating continued efficiency. expand in devices We We continue first site regulatory clearance the the advance today. secured ramp our Fourth, outcomes platform. We've to benefits accounts lumivascular our balance that the a publication to lean device. made pipeline launching pleased continuing accounts. unique report as against structure for focused lumivascular clinical warrants. the of of our next the crossing per and operating in start we to produce device, the fifth, continued the products, achieve of data increased the the generation clearance which possible business. few the market announced pre-existing and past added later sheet we've active a expect from with maintaining same new year Avinger, year million of confirming new of SV ordering And good number opportunity. exercise the our to outstanding Pantheris and basis. to quarter for progress on FDA expense since Pantheris we've generation on year-over-year cases $X I'm

in we've months the made bit this progress growth initiatives of the a break our specific first more discuss of down few some me and XXXX. strategic Let against

utilization sites driving current current First, in and markets. at

While revenue pen extremely XX% Next Pantheris growth therapist and our quarter, XX ago first delivered efforts to and increased most This force the period. test strong increasing performance perform reliability customer results device seasonality The well satisfaction typical to compared sales clinical Generation a clinical from in our to with we combined with of importantly, perspective. higher translates experience quality, business continues the utilization. year sales and the

quarters. off compared is start strong year to volume and positively to quarter case a trending second ago both and with the revenue The prior

make to year. growth, force the to new continue this people strategic our beginning hiring support sales two We investment of of including the the in sales since

towards in recruiting process, We support efforts these year to track important of new end ramping by be will organization and hires professionals continued cases, in approximately believe our second in We facilitate to Pantheris sites. investment launch sites sales of target with progress new areas this new our continue growth lumivascular also new adding we presence our With force in of additional the Pantheris accounts first high sales We've XX of expand SV, our opening our quarter. launched the in made good of lumivascular enable initiative user and PAD. the four against XXXX. incidence

addition we had orders sites total existing quarter. first for the XX from of these a the lumivascular sites, of in With accounts new and catheter products our active recurring ordering

throughout pending we access image-guided is and tool to image a dollars company estimated set presents a expand and to that including market lower in significantly atherectomy around and our the first with the vessels, quarter, SV third launch strategic our safe device. per effective Pantheris enhanced trend and PAD the CE mark without generation and next market. vessel case the of precise clinical several and SV address and in longer could we a on positive to of directional an the gain and performance million current minimally site safety of limited And expand atherectomy provide SV transmission those Europe to knee. atherectomy Pantheris as profile commercial for was second profile, the We has positive. indicated Treating market at innovative allow providing vascular announced expansion Pantheris receive XX% device portion new including this sales prestigious conference length with from some SV measurement Germany diagnosis to a of potential the our SV designed Pantheris physicians than Pantheris below and based Pantheris of injury addressable FDA device, strong population. had a In small combining for this under news knee ability launching have XXX(k) of available force. link the clearance invasive provide in has smaller causing By $XXX opportunity. treatment devices and expect continue number time to new SV below featured The as our the in challenges patient XXXX the outcomes growth small risk especially of those related with April, XXX larger for area maximize real revenue initial our high vessels, or been excitement guidance, By experience believe Pantheris, our this the luminous exciting live in to Earlier the we million advantages quarter. much diameter Pantheris case to this the clinical quarter our capabilities. vessels, by the

an pre-marketing opinion of experienced XX launch lumivascular leaders U.S. preparing that current received initial have into into our limited platform we with which key the FDA for U.S. sites, all introduction and Pantheris Now clearance approximately for device. our market, we're

accounts types us anatomy, next and commercial an full a staff necessary lesion users new ordering SV training multiple tune gen variety to clinical updates systems, we our It providing is product to teams provides the physician sites, gaining with vascular box console programs sales in in support fine now that Pantheris, Pantheris this to and device of As code their for engaging believe clinical also an product setting. our and and prior launch. product and opportunity inventory support new to light and step support to important experience building the excellent launch. sales clinical training We're with imaging with any clinical

Conference vascular May showcasing Both early clinical focused and be the treatment also CVC disease. based will NCVH at US Conference conferences Pantheris the on July. SV of in in We important

market quarter cases third have for and beginning full a early the quarter commercial activity once there's cases SV anticipate in While, limited launch initial prepare been Pantheris the launch proceeding this lot quarter related then of we launch, third later to performed. the in

expect increasing growth Pantheris of to revenue case to We drive SV volume be our half and in second accretive XXXX. the

half CTO year. this initial product in pleased guided our case next and the is development the commercialization image We're progress very for experience marketing we're of anticipate with development Ocellaris, crossing making gaining this second generation in up CE device. and Europe of Next product pipeline in our the

to arteries. in the to launch a XXX(k) many next position a submitting use available launch Following case be of next U.S. launch If Ocellaris CTO gen of in Pantheris into our artery or is according completely we in Pantheris of SV for Ocellaris stands time one with third chronic launch XXXX. XXXX, by and for about plan, the product as year. blocked us and in anticipate the Ocelot creates PAD to years occlusion new experience new severe peripheral of which total FDA all be of hope our opportunity in the guided the XXXX, we in the Ocellaris lumivascular the our the of of challenging crossing Europe, for This this the U.S. in goes catheters, to initial devices Ocellaris most application launch market image will on the only market. first a CTO treat. extension forms and product of the family

leverage a precise about are to We're provide well development treat utility and application new excited opportunity are of sterile high expand crossing believe XXXX these of starting to a data, Ocelot in in use for clinical there. extremely the a our Ocellaris. introduction improvements of RPM, and treatment as as will advances maneuverability. We procedure streamlined peripheral reliable up generation this presence of market with will CTOs at device for the and OCT next result time is of that to easier the the range wider more that platform physicians strong arteries the the technology as to imaging number greater device we This a for the a catheters and tip CTOs. other ability While spin the incorporates definition CTO see to such speeds real with in

developing specific product bypass see patients restenosis the peripheral of been of medical was at the need deliver the treatment our primary guided the we clinical of another the blockages believe be potency, has we Cardiovascular great highly We of highly for In safety the reported data provides and invasive lesion We've coronary progress and coronary the to R&D community antirestenotic this fourth target transition driver an from with revascularization unmet development made technology strategic in TLR guided Ocellaris arteries. the can atherectomy This in Surgery. in coronary XX yet a center expect of critical need XXX%, represent study TLR, growth of clinical Pantheris differentiated which and is the apply benefits precision to retrospective are to of our of initiative, a the treatment work with of lumivascrular months. our the potential no of we arteries also or single to additional measure approach of data was lumivascrular study programs months, completed XX% substantial to announced the for clinical at a the compelling XX platform. platform with CTOs for demonstrating in with application primary for image and outstanding image our Journal PAD. Total of plan study in patients Once set a development focus this arteries, April, surgery, devices. we therapy, This study indication treated in the in XXXX. to good coronary delivery this freedom of publication showing the R&D for outcomes prior also primary technology clinical support arteries, one outcome our peer-reviewed

filing FDA of options for study at treatment present Early this year. has IDE a clinical enroll physician interim safety later the the clinical effectiveness evaluate in encouraging would patients a results an to ISR instant designed or we indication expansion the are treated conference trial, study will believe the to very on insight continue in lower in In the patients multicenter study ISR to one be restenosis claim. our investigators treatment and first the with application addition, of for Pantheris Pantheris. anticipate we We which specific completed, plan currently arteries. IDE of a XXX(k) analysis Once a is pursue important is extremity that which an treating of for we and label limited this

made and XXXX, discuss we've expenses. revenue strategic we've focused leaner, to by in Importantly, the financial this initiatives throughout first the more year a and operating maintaining the progress we quarter organization this with growth XXXX sustainable lower areas translating growth strategic the call committed progress In are and ago a made operating to over recurring the results. continue trend in these XX% against to remainder of reduction each while significantly point, and delivering I'd expense stronger like the quarter of We Mark to turn to beyond. At of become compared

Mark Weinswig

quarter compared $X.X strong December increase XXXX million with Total XX% quarter Thank was in margin Revenue first was for XX slight quarter a fourth in you, quarter ended was million sales ended quarter of the XXXX, XXXX. million. first and XXXX to the for our XX the $X to Pantheris in $X.X Jeff. the Key results the XX%. increase year-over-year of first Gross first March

level. gross the Our lower impacted, was due margin to revenue

$X.X are $X.X our tables common EBITDA, quarter million revenues. decrease $XX.X of that fourth release of other from and first $X.X for which we $X.X million margin million, were $X.X from significant the for obsolete the an XXXX and quarter Operating quarter, expenses for in XXXX the XX% the million compensation increase XXXX. the was quarter loss million year operations excludes million, is million, of the a first for from to million in to in and believe slight quarter fourth the of Loss of continue an a of first our there for $X to improvement prior gross from We of a the of from stock decrease Net first loss today's fourth a of the improvement grow an a and of XX% first opportunities quarter from as $X.X quarter significant measure million non-GAAP for the quarter XXXX first loss quarter XXXX from for a XX% improvement of the XX% the and items, and a was quarter a restructuring, improvement for improvement was certain million, excess loss million of for Adjusted the attributable stockholders of $X.X a prior charges of $X.X noted that from of loss as XXXX. $X.X a million $X loss first press for a inventory XXXX. quarter.

year, past our while at same structure, progress have the future. in cost Over investing Avinger's time the made significant we in lowering

an the our equivalents investing resources proceeds total additional quarters. from warrant marketing upcoming to compared received over to has SV, With $X bringing XX, our March year-to-date are we March grow operating expenses Avinger $XX.X an Subsequent million to XX the million which of Pantheris X.X $XX.X the in million. rollout XXXX, sales December exercises, of million and of to increase as may business, cash and XX next additional XXXX, XXXX. as Cash few in totaled

stock convertible million XXXX, stock approximately preferred Each into As were of stock, A of Series of XXX price XX and of shares December share preferred Series of come of shares shares B is stock, there at XX.XXX of outstanding. company's C conversion preferred B Series shares Series no of stock, the common stock $X.XX. shares preferred XX.X X,XXX a

previously, share XXXX, to additional exercises bringing the addition, count our million associated million. we X XX.X In warrant to have issued subsequent March an total shares with over XX, noted

which Series of outstanding of all XX.X company Jeff. presently approximate conversion XX, the I'd price have preferred B and excluding shares A the of conversion call not would a exercise of to at Series back stock warrants, turn million stock like this point, At as a Assuming convertible. the outstanding current outstanding stock shares our all XXXX, march the to is preferred

Jeff Soinski

Thank you, Mark.

progress growth months good made strategic more initiatives about the While, part of the milestones to year, we're events the we've excited come even the first ahead. against in in and our

will to gain SV generation and Our device momentum add continues soon marketed portfolio. to Pantheris our next product Pantheris

our to commercial to the forward With at the in be strategically compelling reporting We approach lumivascrular your this infrastructure take a rightness costs investing of And continue provide continued to while maintaining growth. the questions products. of our structure, future lean operating evidence to pipeline progress point, in for ahead, support in build we'd clinical advance we're focused our and and our we're quarters happy on

Operator

Instructions] our we'll Thalmann. question [Operator And take ahead. go from Jeffrey Please Ladenburg from first Cohen

Jeffrey Cohen

hear Can Jeff me okay? you Mark. Hi, and

Jeff Soinski

we Yes, Jeff. can,

Jeffrey Cohen

Awesome.

go I'll order. reverse So, to

to share about account. talking you're Mark, So

quarter, what to about taken firstly, talked you So the million. was up $X for in currently

and the left to want said share account heard. what's at you XX stab take You I So a currently?

Mark Weinswig

million is XX.X share Yes, our as of April XX. count

outstanding have of X.X level. shares, we kind remaining terms of at million $X.XX In the about the warrant

All Series activity since end of of no been of March. our X other and the Series X the end warrants there's

Jeffrey Cohen

still there's there out million what available. $X.X another So

to So guesstimate?

Mark Weinswig

Series be for ended all roughly would an capital the organization. if converting X, million warrants additional our of up Yes, $X.X the

Jeffrey Cohen

Okay, great. it. got I

you cases could into about of to a thus in attended be little you're far you've EU SV about some as yet, you've the There's in territories? clinical the bit said going experience of XX I'm the the you And launching far? heard U.S., talk sites. bit So talk little of assuming some or a as no U.S. been that

Jeff Soinski

been right, the That's we really pleased Europe. initial Yes, cases that we've with Jeff. in did

want our best the U.S. experience marking, get understand the cases to trivial support vessel to both stenosis strategy so small the had four as device, if have that to to in of case Europe, first the in we is number part understand vessels above where millimeters. the how there's CE we the launch with and the below knee to below improvements know, the narrowed in prior the position of well make can device you as did knee seek We As a that initial in any the

you the this the knee, but as approval device not above So get below might based our or the and on size. based for remember, in EU, on in the we U.S. vessel knee

the So knee is these smaller while and knee, vessels to of physicians for this There we do the potential the TLB number behind significant from size be below the below all to the the and believe the lesions. cases device just there due in six-French will knee of so use also the does have is of and who some SV. for physicians opportunity are device accessibility, anatomy Europe, had that preference experience above and a six-French knee a we've in great Pantheris and those provide for a sheets that

of also available talked was received. recordings case positive We link, that and and about at Dr. which well Schwindt again the there's very

have the the U.S. we that now So clearance in

also We have adding those doing Pantheris into sites, update that will an imaging is were the get box to we committees their our engaging light There to that exist. VAT the sites contracts console. initial we're and identified presenting SV with we're we're required, to the product be system,

Since current might our clinical of the bring in runs is which ability Pantheris, well XXXX the speed SV. of SV Pantheris you will imaging. twice the Pantheris which we remember related RPM, have as benefits As the at as device we to think

clinical to We're product inventory support specialists a team our get transitioning support commercial training And while initial who launch. experience. building that our as sites doing that program We're And focused we we're and going we're those be on are staff. the really training manufacturing to sales to so are that. clinical

and time launch third So we in will to but the actually launch announce the limited device. first we're don't busy announce case until and early with that really expect our at this quarter, to expect experience quarter, are

types, building initial further our opportunity et studies in number number as only in launch experience, variety a those initial use great will clinical we'll lesion we advantage users train anatomy beyond broader not sites. can that and getting of to case be in experience also a and So marketing, a of cetera of that and when we we're hands in salesforce the take period, an

rollout the the With the third to sites. of to by our our to XX sites if remainder everything lumivascrular of goal to launch quarter plan plus goes into end according the begin the

do as the SV growth quarter. especially incremental we So driver third But promote lot a and into of even right front of as here. an from important it the device excitement see approval into revenue the quarter fourth being at about can the the FDA. I of since and now legally and we we're or we we lot of Pantheris excitement A everything's talk in - this have driver field go believe,

Jeffrey Cohen

it. Got

about as talk how Europe? label ISR you can talk into extremities can that bit So SV here indication? And will lower the about a potential as a filing the little So obviously? timing has go to Europe, in for you they then so How would in go and cases? get far

Jeff Soinski

Yes.

indication the have in ISR Europe. already we So

due smaller Mark As under you of CE the but differences business in is the part know do in international indication reimbursement, have a much our we to ISR Europe currently.

We after insight our the are the to here in trial expansion label - ISR go the enrolling in U.S. with

patients early year, because year. an to we're be independent really at will getting one is to this cases review by expect seeing in And for for do will mid-time this And We And the data file seek that follow results full the actually the a clinical of complete have in ready our necessary our will data at required under that the data a this that XXX(k) months study six the important FDA conferences to present to kind independent present of adjudication have the requirements, that pleased follow-up. but results We're following will FDA year, we then those and for months label. after we'll a that the study. of for believe we're know we very study, six board. be non-blinded batch the enrollment expanded available initial

at will of the study at enrolling, end XXXX. get publicly till of able and share to won't that look end to to through a but be to So we we continue data, data know, the have some you of least to the be wait that

Jeffrey Cohen

it. Got

picture and far you of some your as and typical about seasonality income how it Okay, plays on big reflecting your kind as year commentary talked out. of statement, the then,

with kind different quarters what's to that about of the four So revenue, we're be more consumables, of how is something the is up less might readout on for currently, is QX more the of think a placements the and 'XX? with pronounced differential the 'XX, expecting competition that and line QX what top we matching balance now about than

Mark Weinswig

Yeah, we so on Jeff, know, the capital we call revenue box. the versus disposable you on about our are as of the calls, last kind recurring one-time the strategy and as you and shifting from recurring previous do talked as last in call, here sales a that more and the to sales light of sale focus

use Our that seeing And the the are easier we're in we're make base. in our of accounts catheters access to growth to growth base the light that that active high it to our account box. to goal driving get for of some ordering going the disposable margin the is and

new of latter quarter there for transition and that, kind And dip quarter. XX% of second is year-over-year the see product, early of the the typically latter we The we big know, so as the great right, strong And and new seasonal been launched did and really results, work part really almost through first the which typically kind a in organization next-gen you happened our sales that year. a device, in of in lower this that were on quarter. happy we and now part we'll expect big us news, just did which very that to Pantheris we is for growth focus clinical a has there and story year last reimbursement

cases, our our in we because atherectomy but that it coming see differentiated. What it we're sales Pantheris so more quarters, So, lumivascrular speed confidence the few will takes team confidence at supporting especially to our time with is with typically to typically the we improvement new capability build device also past with over people procedure. organization platform build how to they're pleased added quickly next-gen the the streamline just have and number little to up is a and of the

really on So progress up is of which of it could supporting CTO regulatory basis, good this takes on of little lesion challenging them big get as CTOs, the progress see and And we but into sets already to one are with cases Ocellaris we're go or speed in XXXX. business a more longer this one frankly, submitted think much quarter. we to objectives we drive seeing year good get across our CTO to because next the company the generation our a that Ocelot

of overall. you basis, So, mix a a revenue expect is recurring see lesser to would capital to as know, grow, be to to the know, I disposable continue you percentage revenue Atherectomy bring a stronger because Pantheris. component and along of combo in as But performance more the CTO than hard it get has strong of very cases been the working well. past we're to

quarter growth just this but our in salesforce of old commercial year, And expanding of re-engaging know, so the expect only not revenue plain, quarters customers execution, representation. had been we adding well you really drive just someone more of early at represented. haven't where through We Florida next you added know, territories the past haven't some and new potentially are over couple rest to as we adding kind as we of in quarter, this in the in we Atlanta this look looking activities, or we in to where someone good

revenue expect second that XXXX, also an exciting driver. SV growth Pantheris will half the in be of We

So positioned we're execution drive business. but this I our about to well continuing believe lumivascrular positive in momentum and it's

Jeffrey Cohen

Super.

for guys. if me. that's Thanks, Okay,

Jeff Soinski

you, Appreciate questions. Thank the Jeff.

Operator

so this be I'll to it appear over back questions to time, turn closing remarks. at no there further And Instructions] Jeff for [Operator

Jeff Soinski

report we our forward Well, for thank Have on very we company interest much and a joining you progress our your when look our afternoon. to We quarter call results. updating afternoon. appreciate in this good you second

Operator

does attending. teleconference. thank that today's conclude you And We for

have may great now disconnect a your lines You day. and

Avinger (AVGR) 8 May 192019 Q1 Earnings call transcript