NPCE - Earnings call 4 2023

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Operator

Good afternoon, and welcome to NeuroPace's Fourth Quarter and Year-End 2023 Earnings Conference Call.

As a reminder, this conference is being recorded. I would now like to turn the call over to Jeremy Feffer from LifeSci Advisors for a few introductory comments.

Unknown Attendee

Good afternoon. Thank you for joining us for NeuroPace's Fourth Quarter and Year-end 2023 Financial and Operating Results Conference Call. On today's call, we will hear from Joel Becker, Chief Executive Officer; and Rebecca Kuhn, , Chief Financial Officer.

financial XX, the XXXX. released year quarter NeuroPace December ended today, results fourth for and Earlier A available website on of the copy the company's at press neuropace.com. release is

during this to Before forward-looking include made the securities you we pursuant would federal within will like future of which expectations the Act begin, are of that results statements made statements I safe or performance Reform XXXX. statements throughout to relate of laws, call, meaning that Litigation harbor this Private provisions forward-looking that Securities events, to of or we make remind predictions call Any are statements. the

assumptions. performance, statements, including market opportunity these management forecasted and could materially forward-looking those involve opportunities, trials estimates on statements. market by projections, business and implied and cause various Accordingly, reliance are place on growth results and these undue commercial financial risks that differ expansion, or relating actual to All current These events to trends you should based forward-looking and those expense around conditions, operating uncertainties clinical those of not market statements our revenue estimates statements. NeuroPace's future from and material

XXXX. disclaims or statements, law, required as whether forward-looking on we except information, obligation, refer the or to information, and of XX, future that section any the new detailed on believe December and otherwise. only of or financial any intention future. This XX-K accurate the more with of Form annual business, reports Risk on revise by our ended XX-Q, recent associated with events conference other including NeuroPace filed in for we year XXXX, of report or X, SEC, Form the risks projections the call descriptions which our may with please broadcast our update For public with file the to Factors this March because live to any uncertainties time-sensitive be filings the SEC is SEC as quarterly contains reports

Joel I now over call Officer, Becker. Joel? turn Chief Executive that, With will the to NeuroPace's

Joel Becker

and everyone. Jeremy, you, good Thank afternoon,

fourth As what execute and quarter year. on in earlier issued XX% been quarter today, the off increase Revenue period cap an has a the strategy same you release for delivered year. saw outstanding was $XX quarter last the another to continued has team NeuroPace strong to to our press compared million, the fourth

year reported of revenue full over $XX.X the increase For XX% total million, XXXX, we XXXX. a

As additional and XXXX, team of is was new for will of if growth in We will XXXX, me published execute year exceeded additional over patient CFO, our to increase around provide in X-part treatment the tried with we support and review are continually not current Against details once category. plans, exactly priorities look the our plans that be be momentum key developed color that, to epilepsy These and and which guidelines year I believe to performance on top a failed quarter XXXX business for the present what ended line XXXX, our In quarter XXXX. patients year the fourth raised to expand our some and Q&A well this and just access back Rebecca full as of as and step of ILAE, followed or appropriate. groups the to has we and a back for ago, and they look fits in in results drove that that that XXXX. With aligned intervention and surgical stating should everyone to turning medications, new company in patients. epilepsy, bar International worked our across financial before December on strategy adoption by was clinicians session. existing all utilization even then near-term proud XX, the drug-resistant call Kuhn, capitalizing let forward the League the to am I RNS to we've and medium-term therapy accomplished which where a and expectations. and for XXXX referred RNS

Turning to strategy the X-part developing expanding RNS access our to our and system. market for for

surgery. current approaches, The a across first and story. and be RNS Comprehensive This traditional driving on surgery and call education is approach with now, of stimulation approach RNS a stimulation hybrid as what expanded the network clinicians through which a patients surgery, centers form part or subsequent with focal Level conjunction of our or modern how focal by epilepsy treatment prescribers X to support at utilization broad can base at with Level meaning with through therapy and our treat is and on CECs, of of customers strategy, used in we utilization existing drug-resistant adoption aimed X help RNS either Centers therapy the a is range focused motion to by aims epilepsy stimulate in to RNS under Epilepsy utilizing

story improvements RNS RNS the have in of The ease also with use highlighting platform. the made modern we involves and efficiency

with system and We are X these Level momentum the in efforts our pleased centers, it growth has our much RNS driven of of within XXXX.

and Level the FDA centers. is possible due to to area access and Project who be have now opportunity referred patients RNS opportunity of system our provides provides expand for we approval expanded care of to our will of home This or for X the been to patients a for call PMA and a in to be This the approach supplement an be new RNS identified also prescribe of X Center could to Level to to has strategy, the opened focus which the would to access neurosurgeons the XXXX, treated implant XXXX appropriate CECs. access X not X,XXX not and The potential part an outside to second approved CARE, closer which referred Level epileptologists allow the within remaining in indication. up functional additional to labeled our and system ability currently approximately

to activities these and have We centers are half program X outside planning of first of this some pilot begun. the of Level initiate during XXXX,

the process our early treated While number regarding In as should who that be making activities, referred the Level experiences with are Level incremental centers joining as we interactions target program with identification sets pleased the been growth and for we pleased to have proper have the we centers support initial indicated to and with skill to the RNS with for and potential of we patients the as valuation. system begun in of pilot NeuroPace patients additions of as of in in to CARE, teams support seen that the our X well team. and we well seeing express have a interest for and locally hired potential our Project in ensure centers, appropriately initiating order of the RNS representatives support be the sales are X have

our focused need third of phase which generalized the XXXX. quarter subsequently RNS the study enrollment strategy the the that The reflects significant on is pivotal that the system. indications effort based NAUTILUS is patients FDA idiopathic on of unmet study, exists pace epilepsy. refractory the RNS for believe during implants drug currently and in for of with expanding enrollment This improved the We of required implants fourth the for completed number and submission

to requires an endpoint This a trial evaluation As post of highly device RNS represent the safety our XX effectiveness with evaluation approved, potential be implant. reminder, NAUTILUS a and for has system the the a opportunity. an study FDA-approved epilepsy. primary market would expansion indication months meaningful first If generalized

and software leveraging to of development Additionally, in XXXX, efficiency our clinical both tools, well capabilities we patient on use. AI as research plan analysis insights, support and data work and as enhance ease designed

from look quarter take The performance of sales RNS RNS and financial for offset revenue system. our our by at decline was a XXXX, was partially fourth deeper primarily new RNS operating of sales driven continued replacement we system implant of revenue. As growth growth by the

with the epilepsy. RNS on Also, for and newer as to most to had of diagnostic DIXI growth mentioned older revenue Medical continue products electrodes with this version. partnership already their have and sell to decline their devices we version our occur I've As we calls, exclusive the with replaced from related previous patients expected device see the market

these system. RNS where to originate. treatments seizures epileptic use interventional this a with Physicians including are reminder, target information determine our products source, used to at As the seizure

appropriate system complementary visibility earlier provides the is not partnership do and may plan offering RNS basis, ongoing revenue existing pipeline to patients we that RNS break customer our base to the remains This components at candidates While team DIXI of commercial to performance for that a on an of the revenue. out contribution leverages highly total product and into therapy. line from be approximately our XX% top the

is put differentiated and needs be to continue The we performance, and focused on progress our patient clinician in technology we with review place XXXX. our strategy leverages made we As pleased the in organization. and

result, of to As while to $X.X a have in execute in we been burn expense quarter maintaining cash resulting management, million, XXXX. of our compared fourth fourth in of disciplined commercial million the able $X.X XXXX the strategy quarter

recently of We the treatment have analyze biomarker believe help its this unique The enrolled will Phase biotechnology RNS inform RNS system that strategic then our the ability in value company, that a companies collaboration can and of evaluate implanted through to leverage generate to and regard that RNS biotech example data, With which with is our capabilities. insights groundbreaking collaboration provide the into IIa which announced, patients new its collaboration biomarker opportunities analysis proof-of-concept and systems another collect to data candidate. we monitoring we've currently entered system changes first-of-its-kind strategies. a used proven is will have can trial product

out this to XXXX through agreement which to the are completed into the phases receive to each certain total of end from milestones with majority of is correlating We broken $X.X of revenue planned quarter million. to approximately of The X XXXX. collaboration phase, fourth the prior be expect

to which report increase turning we XX% and XX% to compared the for between full $XX forward on margin We focus revenue XXXX, revenue to improvement keeping driven by XXXX. apprised to revenue look XXXX, our Currently, strategies. execution in NeuroPace million management. in to year million progress. of The expecting expense team to of a operating our gross I you and growth, increasing represents continue are and will Now $XX

quarter fourth to our the call with our and With that, some detail along I XXXX now results, Rebecca? will additional Rebecca plans. XXXX financial financial to over review around turn

Rebecca Kuhn

to by quarter primarily system. XXXX increased growth was This Thank quarter XX% sales was the growth compared compared NeuroPace $XX.X in XXXX the of XX% representing approximately to $XX fourth million you, XXXX. for million, RNS Joel. of driven of our and revenue $XX.X of million for fourth of the third quarter

contributed DIXI from meaningful of distributor. revenue quarter revenue year of DIXI a fourth Dixi products amount full Medical generated of first small the XXXX. exclusive also Medical's of our We sales to in serving U.S.

placement for in to revenue. XXXX. The quarter and revenue was of to last compared quarter XX.X% year the Gross of approximately implant XXXX fourth XX.X% of of continued fourth the to decline total in margin compared XX.X% same XXXX and represented the third quarter X% and period the

the increase of increase and in products was products. Our gross DIXI gross RNS due were margin margin offset from overhead for manufacturing as more fixed costs quarter primarily in sold the RNS margin distribution partially The the spread lower produced gross over our by Medical increased to units.

quarter by expense This our compared reflects into period XXXX we increase R&D a primarily offset fourth in move continuing SG&A operating million Total due with resource decrease prior expenses. allocation decrease the $X.X of personnel-related the increase to driven focus the are finding we to fourth cash, This $XX.X year year. XXXX in XXXX. increase our the and committed the partially with of outside $XX.X XXXX. in The an services period. of $X.X the prior the in was was manage on appropriate quarter million, with expenses million was by in in million in of effectively were expense compared an as in period SG&A expense, XXXX million which $XX.X same to decrease in personnel-related fourth primarily was quarter insurance $XX.X same compared the expenses. of in million

compared quarter maintaining We is our compared managing fourth key prior in balance the on a XXXX year revenue was million of the period. compared focus quarter was prior million growth. Loss with year interest of the expenses the fourth to XXXX period. million $X.X from of expense the in in Our quarter $X.X operating without recorded of $X.X million quarter for with operations in XXXX. million Net compromising $X.X fourth in loss fourth million the $XX.X of $X.X

$X.X million. of burn in was XXXX fourth Our cash the quarter

XXXX, XX, was as Our investments million. in of $XX.X cash balance short-term December

Our long-term borrowings totaled XX, on XXXX. December with XXXX, September principal as of $XX million XX, full the due

by to range full XX% of ahead, we revenue to year $XX XX% XXXX $XX we to expect approximately million look to million. As increase a

mostly in continuing driven DIXI make sales an expect RNS We from will contribution. this growth our increase by with be growth to sales Medical system a of of products meaningful

to for of revenue XX% in our be to factors. range XXXX, proportion variability overall and small may DIXI other see although XX% a we revenue to gross margin expect We the to in Medical of fluctuations due

We XXXX and for $XX noncash expect approximately $XX million in stock-based expenses range operating million, million to between including expense. compensation and $XX

turn call for Joel back closing the remarks. I to Joel? would now over like to

Joel Becker

Rebecca. you, Thank

positioned to our between year are year prepared long-term guidance, and the we've achieve is over of will drive the future our are clear strategy, positioned million remarks. the We to progress of as accelerate making the to $XX at its are that Consistent and XXXX XXXX We opportunities each potential of NeuroPace with are also on concludes strategy to deliver growth to very and and $XX This be on to excited profitability. these entire and is believe our revenue past we NeuroPace. develop. our that by elements focused committed advancing the we believe their growth been XXXX opportunities in the our execution compelling. a million, team

I now will like call turn over open questions. call the for the Operator? the operator, would who to to

Operator

Capital from Instructions] from comes Your Markets. Takkinen question [Operator Lake first Frank Street

Frank Takkinen

the I year. of expectations did guys growth, check you XXXX on guide a throughout keeping was a Congrats nice had job XX% very Obviously, one year on the in to progress. for year. with start the the with nice hoping in

year growth. pretty was there's Looking curious forward, I looking the as element of just assumed conservatism the like solid for end looks elements in XXXX high guidance the into if at XX% understanding assumed to the early of range. we're some are the of what that low the that XX% on growth, baked But and and and end of market the dynamics elements range are of some in guidance the an

Joel Becker

and you, thanks thank Frank, question. for that

So said, with for XXXX, XX% to midpoint our XX%, there as guidance. and the business, which is $XX you double-digit the comfortable the $XX guidance, implies million, for of that growth million growth, we're

comments talked in are the feel with We and them clear like with obviously the there a compelling our in the modern about RNS guidance, excited force are CARE. of expansion. a got at year opportunities. front with and of We're our We incremental beginning story. of my strategy about I number here Project sales us. underway we've We're

So excited strategies front us. We've the we're challenges but and we all in the we've think are those sit 'XX. are that 'XX here -- March. about excited about for We of there year. in in the in We're got also year plans opportunities also

our a In things was the growth think versus about year mentioned, as some but RNS the when growth year of things sales range some products with $X.X that we DIXI we considerations only by bolstered we there in 'XX, distribution was also 'XX about, having XXXX, quarter compared kind only XX. of of in you QX where the driven system. as had Some the million in by full revenue. It within one and to think contributed DIXI there, primarily medical of

trial half But first that implants NAUTILUS second volume factor and in so the well the that associated we've replacement of about then obviously that the well. half talked bolstered of the then really more we a the And as some than dynamic XXXX as with and had of 'XX. 'XX being

number were factors for And business. guidance results for in of in all dynamics, double-digit plans the considered our a those growth setting 'XX. the Those in despite

I can in about point executing here as excited talk and time. in mention point some business. around I'd my portend a And XXXX, our also some rolled time, us we've I as I overcome around business, in our and like look question core I technology well, comments opportunities regard would important a add well, about. give as as the we're clear the future. guidance leader this mentioned some Frank, at front specifically into asked to earlier think I We've just and very in we're we we wasn't data, in to in think, But products. what and too, also we we of to you distributed the positioned at point asked, the got look in the just -- that think would where that out, you we're that space. a into a but XXXX, that all So growth with -- perspective we differentiated well obviously challenges It's and it. think to then as when we're we've business business, as got we're well. but the

for the mentioned, Project cash NAUTILUS expansion RNS plans strong the development idiopathic with here system a demonstrating incremental discipline epilepsy and with I Market commercial with of along initiated CARE, position. our indication plans with then that operating organization the and expansion

the think future, And we're But regard there. to us our mentioned, this closing the just got little comfortable So look about of to we 'XX. we accelerate talking into we you of of believe to as a 'XX, bit up with as kind as for well. with guidance again, guess so a I steam head out growth positions

year the year. to got We're as of front a And I'm We think of for is in excited on, the us focused plans year. the the we've really here we're opportunities at point challenges, what in but the the tried what the well start focused make the as past, of some that there's good in number on. about I've team

business the around. and in repeatable we're focused of on that is us from seen what we're have delivering executing that's people what results, and think consistent, I

Frank Takkinen

a I follow-up all adding great us I well couple sales of That's stands appreciate a that territories can remarks incremental as of organization color incremental the you it other about comments times any today heard the sales and as adding? how the you're just on new or Are it. organization, in the territories? response about color. you Can sales a that. additions. about as Is reps. splitting prepared sales Got you Maybe provide level where set thinking rep few

Joel Becker

question. great That's a Frank. Thank you,

about that here. we've well. highlight as organization previously, talked expansion. in in of a So previously I'd We've commercial phases invested the commercial want that We've past about organization think couple to talked I had there's really talked about the our -- we actually here.

XXXX, had and have been to which some we for out now in through organization and actually field hiring So and commercial those done their hit into folks are some training expansion, getting going stride. the beginning

of seen on the in first that So as that the as And centers. the incremental and Project hiring both anticipation ongoing expansion of business be today, will previously. our talking support underway that sales core of initiation now the that to the really we've of outside we're in that Level kind investment focused of the we commercial we've wave about are had that done got we sites And CARE it's here support of well growth for X to the activities organization.

Operator

next from question comes Fargo. Your Wells from Chopra Vik

Vikramjeet Chopra

to a to end the solid Congrats year.

So start the X, I first I'll one. had

have them detail year? CARE, activities of and the the little to some rest the regards what's in a bit And a described planned for maybe You can then more I follow-up. with Project describe initial you of

Joel Becker

that question. you thank bet. Vik, for You

more but number of some activities. as activities pilot to we're CARE, regard of some centers. some as are types still while education is initiate initial of activities as with early, various activities, in outreach initial underway have training the we the as those well with program including well and It Project approval So to process, these early targeted site-specific begun centers. a here of of some contracting to the professional

Vikramjeet Chopra

Got for you. cash [indiscernible] that the the think Thank details, question, just QX. it. burn XXXX. I Will should for my And for I'm how guess. follow-up we keep on congrats wondering about

Joel Becker

add there as commentary well. then out like some I can Rebecca, would you and start to

Rebecca Kuhn

Sure.

reduced see it So that shared reduced with burn, $X.X But it quarter. we quarter-to-quarter. some do generally, we've fluctuations mentioned, regard our considerably we Joel the year. guidance expectations. you fourth in you to cash and as previously pretty million idea to pretty go give a throughout good specifically numbers going idea, to but We're good the with next not year, of through our can come for up We've

leave at we'll And Anything so I Joel. add, think that. you would it

Joel Becker

No.

Rebecca Kuhn

Okay. Great.

Joel Becker

Anything Vik? further there,

Operator

Leerink Your Partners. next Mike question comes from Kratky from

Michael Kratky

neuromodulation provide on just for initial revenue revenue one from you coming growth additional much you're overall on the color your of market incremental year? to guidance expecting growth RNS from for this versus gain market systems epilepsy Can XXXX. share how Another is some growth

Joel Becker

Thank That's question. great Mike. a you,

way a dynamics talk -- what I seeing address and from that we're bit the think I'll maybe little market from a seen about we've perspective. pipeline is what

we aren't the there. the way been to we maybe solid capacity back, and all patients If pipeline EMU So of good and think availability pre-pandemic, the dynamics. been demonstrating seen back, had we do some pipeline patient level that quite like in But the discussed we've strengthening. is been -- those we market patient pipeline days, a those seen but like all that and we way has previously, have we back the in we And pipeline where associated expansion that the isn't feel market pipeline. seeing feel way mostly harken have it's the consistency the do has it's the with of seeing of all

pipeline good. So for like have patient we conditions feel been market

in strong a well like specifics feel to specifically regard hard a competitive make perspective the as from in we to share out in their the epilepsy position. we're as competitors an that way dynamics, position differentiation very like competitive because break data main market a we're dynamic get good I both comparison. market we details regard think feel of numbers like of competitive to But we're apples-to-apples clinical bit into little as there. a a the the think I dynamics, good relates to we technology it position With feel with in could our don't a their calculations It's and

Michael Kratky

will one, maybe on CARE. appreciate attention a Project you innings, this to initiative there. realize going be years. I over additional one it's that Yes. metrics a early be driving next help is but separate how the it. for I to to I then mean the give you color just meaningful what are another revenue going And few paying growth Got internally sense of

Joel Becker

to And That's targeted you. of development the really activities taking a really to approach point learn gets that centers. it that from us a scale taking and great perspective, we're the we we to question, these allows of the and approach the evaluate way how Mike. Thank that's from really market that initiation and interact with and start

I I think of in pretty to types give the particularly us have up we but we're a those have that some criteria centers a going pardon indicator idea, will in learn of the resulted good think watch lot what that centers, also from think these for to leading that [ for, pun. the are targeting ] everything metrics we are things responsive scaling

be should of networks What for what that the of pipeline we What see that like. patient a that and to health committee looks into a the some translate economic of populations underlying we approval can look from and referral are looking are indicators process the the patients. contracting

diligence, process early and a learned that as just early with. And would to them, with some then I that and while are that begun to the centers do through assumptions things going of that or we it and out, which been locally. want have note identify for of is begun confirm we've they've the mention perspective, spending innings, well to intended one is of metrics might training a of the time that so to that from centers are ones pilot us we of treated have the the have beginning go and have allow profile patients as targeting be the engaged say, onboarding some -- been to and through our you to of some process be and the correct dashboard, contracting see to is we've been really targeting that develop and kind

that centers Level could of centers in number patients of patients, are evaluation see back these of of be X referred X to kind further those centers to begun Level a also identification in We've outside of who that patients patients, in uncovering the the well. as for addition were

So begun access and CARE identify strategy really to go the patients patients that see can RNS as of therapy to increasing referred be can well so program. that those locally treated through to both our we've as be back uncovered of centers in things

and and what that's see an gives you to phase of So hopefully, about been hope for little in interesting initial that of to those these and there. watch approaching how and take take here. the But on dynamic metrics shape centers pilot welcome start thinking bit we're centers process color some a we to from

Operator

comes question next from JPMorgan. Your Robbie Marcus from

Lilia-Celine Lozada

XXXX? be quarter how Is at million. $XX.X street think about on we Lily anything on be actually first at seasonality And specifically, you should in is This the XXXX? to what share can was there to for saw we similar looking Robbie. thinking cadence for I Do expect you

that is start? So a to place fair

Joel Becker

Thank I'll if on out follow here and start you, Rebecca, you maybe to Ashley. want anything. with

Rebecca Kuhn

you providing in We're mentioned, summer quarter. the going seasonality guidance we months some for people past, pretty over I our seen in as Sure. We're the for Thanks, guidance provide But as to in common. the particular, have take not vacations, the business think Lily. year. that's

We dynamics experiences. in where, holidays of fourth addition everybody quarter have interesting and in to the kind

the annual number meeting, a long have that We away our takes of nice for a from their AES days, major weekend. of people offices physicians meeting also medical out

are so gives that sense they But have from attendance prior associated trends. with there. related our we I of no perspective, of our different course, that think From you the seasonal reason things year. And some expenses -- at point, this

Joel Becker

thing come into I that. we've around talk be play a of all of commentary A of factors the different only a lot little seasonality, number times, Actually, Yes. can would of dynamic I'd bit support when we add might there. seasonality. that patient got there

have You kind of seasonality. plan well can and can of clinician you can have as then dynamics seasonality kind you patient as have of health insurance seasonality

beta of of a seasonality. dynamic really have these on seen around kind been journey for and of epilepsy We of therapy under traditionally a their patients and/or number health been have of kind plan patient not a evaluation Most years.

And been traditionally seen. something so a monthly or at we've one way the that least other, of kind variation hasn't

As Rebecca seasonality year-to-year out said, having around the around those surgery you dynamics, kinds holidays those be see pretty to the people seasonality with and she course, some that clinician-based to be traditionally But there tend of consistent called mostly that well. as of things. tends

seasonality. additional So just maybe that some Hopefully, a that's helps. little around color

Lilia-Celine Lozada

follow-up on of driving another ASP, really growing on utilization, from And share new is just what's adds the Great. it can mix CARE, then growth Project Is color guidance. you in dynamics. those some there any XXXX, center

So down? how break would you that

Joel Becker

we we question. XXXX, as guide RNS XXXX. That's And implants would as care. with do the to together. at initiation specific see of expect really as expand just well as of great all in CARE, with units through the we and with started we as activities scope and out both a we and growth while growth to regard XXXX. We in that drive Project the in do business the early anticipate not we're those calling the considered growth And DIXI it put we're well the beginning say move associated that potential move activities and through impact here as I getting as would we of that year, is

Ashley, If there, operator, question. else there's anything next

Operator

Michael next comes from from Polark Your Research. Wolfe question

Michael Polark

a interested I'm topic, learning multiparter. This One in more. pharma bit collaboration,

XXXX revenue One, things there's think Or a I paid from interesting. kind like? another do? guidance? are one-off implant. for Two, out you this getting of X there's What one, sub-questions. seems sounds high-margin this there there I you're multiple. And where suspect to a so. in part think, I like this does is considered kind that what's more I this pretty would It I do and then revenue. suspect that like guess, also fee-for-service, longer-term financial -- of look opportunity consider the the three,

me. So profile That's it of just of this financial curious revenue. the type for

Joel Becker

them. We're how really really about is about report. to system, we with that, with as every the Thank are a about thought collaboration take think it can there, pieces really out the think going. all part question. guidance that you, for highlights do which how think key I'm that Mike. the We chance the we about. But different so we're in in Great we this. And we'll talk has pleased opportunities when including RNS the we excited here business lot a XXXX considered that sure of that gone we learn we and

And activity here the for has I to monitor from get should, to analyze well able to our business we as other in data, like our sometimes uniquely insights, that like potential brain both perspective differentiation core quite we ability think and then increasingly, as analyze information it feel record provide is potentially doesn't billing and areas are that report. the a

and different monitoring, we a and So think a of that's number up and to RNS point important other that do differentiation. With potential here, ways of core leverage of a -- analyzing insights in can be in there? or point margin want open data of do differentiation fundamental to a us. that our to we chime that that's you in business interesting have that think reporting we business of opportunities RNS to increased regard us really fundamental Rebecca, capability for efficiency here outside have that can that in whether We it the

Rebecca Kuhn

Sure. Absolutely.

derive essentially you as revenue we agreement. mentioned, Mike, the from service So

fourth of study shared, expected in that implanted. the the we've and be $X.X through we patients approximately it which enroll are will to is system that XXXX of expect already agreement, XXXX. quarter As patients continue have RNS million that over the The in started the the course

revenue really service arrangement. that our So is we from that revenue the derive

it's our the for economics the incremental is There associated expense, gives of flavor deal. the you from by yes, some and so with a I general And kind it. But analysis team devices, think that of data support implanted here.

Operator

Morgan comes Drew next Stanley. Ranieri Your from question from

Andrew Ranieri

Maybe go gave, just what growth new hoping just new to put it's I XXXX, because your finer a in implant on was back probably for some that a to close underlying XX% that a year-over-year. for could I touched of you know guidance, point implant XXXX you help when growth I was the back look building times, at numbers but on few been to

about kind the You from trial also that implants RNS absorbing NAUTILUS of talked you're of there. the some

in metric utilization or an help RNS? perspective out to built from like for XXXX new us kind just what's underlying guide your So being parse account for of

Joel Becker

do RNS off from strategy RNS growth see see We really from being question. of that from initial great sales a growth as DIXI. talked we coming modern underlying the R&S implant story That's here as Drew. Thanks, driven growth implants about. had and We from well

So we see lines. growth across both of the product

you the impact replacement full further change implants the in and mentioned, the of the the in of that guidance, as when of year 'XX, that's I diminishment NAUTILUS then units overcome growth impact net has of distribution. the DIXI And that the see to growth

by with want you a and the growth how in we to being to project maybe are mentioned. rate growth, activities some I line. overcome that's revenue outs, you across offset lines not digits the that as the guidance see associated DIXI underlying the the strong some of expansion then We're expand and XXXX. product calculation both here those that do do from specifics as across needing growth those for see and here for not well growth have and kind product dynamics here there. the organic out growth see dynamics point ins adoption utilization a we and core of of do adoption by of do it see product product We for But the got both the that line we've our those both me that fulminant the of then underway lines. from I utilization initiate results of making other activities we double centers in up know breaking But in guide. those the to So get we and we to some both lines in product answer of

Andrew Ranieri

about $XX Okay. million feeling 'XX. off the bottom growing you're around But like for in line, good implants initial did you

Joel Becker

RNS We area see in growth for as of revenue systems us an initial XXXX. implant from

Andrew Ranieri

appreciate you just just expanding all give Great. that we you the But just Have kind line. where to I you sense trying the guess desire. just progress, are like really DIXI like in I distribution refinery then as us around And to the had that with all give progress Okay. accounts of are you going customers? I'm a And of you're for all detail not existing on get out sense XXXX, of spread and are RNS. a just you us product for DIXI that thinking the commercial about

Joel Becker

regard by Thank you, think we I I about through mean through talking modern -- Phase opportunities product an And RNS, see And centers question. managing to important that. being with to really And line see support it's and with Drew. the another epilepsy DIXI. and to the I we that, monitoring think across service DIXI, part the with and approach opportunities use of patients II great of

an current Level we growth us And is to SEG for of Two, part grow of customers, customer opportunity base see X the so centers our that the deepening the our even absolutely us to in for one. use of footprint. opportunity electrode business expand with

the as to Level introducing there competitively of centers, with an like expand an opportunity and the opportunities SEG is commercial associated as to organization, our X feel leverage to us of the deal like into footprint well then this One into both well. we the for is, distribution one technology of opportunity in course, electrodes as do

but of our really DIXI, with been kind to distribution the as that the to RNS. DIXI pleased number with we've see vectors a relationship adoption of in broaden so and progress different of leverage organization I the with also utilization we've made there well opportunities as And in

Operator

Speaker, There are further at Instructions] no time. please continue. questions this [Operator

Joel Becker

you, patients seizures. And excited time support tonight. are And for transforming living We and of to for Thank your Thank the about for you XXXX. thank all. continuing lives to joining and Thanks NeuroPace. of call mission interest you. debilitating the in NeuroPace look forward of the everyone, and with

Operator

today's Ladies joining. concludes Thank this for you call. gentlemen, and conference

You now disconnect. may

NeuroPace (NPCE) 5 Mar 242023 Q4 Earnings call transcript