Earnings call transcript Q2 2023

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Good afternoon. My name is Dilem [ph], and I'll be your conference operator today. At this time, I would like to welcome everyone to the Inspire Medical Systems Second Quarter 2023 Conference Call. All lines have been placed in mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session.

call President your Inspire. of the Yagci, speaker, hand Vice the Investor now over first to Ezgi I'll Relations at

may conference. begin You the

Ezgi Yagci

in Deane, call. you, and you for Thank thank participating all today's

Herbert, President Financial is copy the of XXXX. Chief today, three Joining me six Earlier on are and Executive our ended Rick Officer. results Officer; financial released release A months the available Chief website. we and press Buchholz, and for XX, Tim June

statements within without this meaning management current our to access call business, make forward-looking XXXX and All various financial including and On Federal estimates full the statements, our and financial market Laws. are our operational limitation, the based Securities investments results will assumptions. of relating in outlook upon condition, year in operations, and forward-looking financial those changes

material results actual Form Securities should these was involve afternoon with with our could statements Accordingly, or risks filed XX-Q place filings events risks for statements. undue this and SEC that you including and materially the of our reliance Exchange on these Commission description differ. see uncertainties. not uncertainties cause a earlier which These Please and to the

update August projections broadcast of as or information live speaks revise intention disclaims call time events conference law contains the information, Inspire or only XXXX. of today, financial sensitive or and any required future by any forward-looking to new statements, obligation, as because except or XX, whether otherwise. This

it the over that, call to Tim With my Herbert. Tim? pleasure is turn to

Tim Herbert

XXXX. call for our update of the thanks, for second everyone, and quarter Ezgi joining you, Thank business

possible with patient and with patient Inspire has therapy. start to the we outcomes always, to ensure As commitment that each experience best our

patients treated second end quarter, Inspire As over the therapy. of have of been XX,XXX with the

Medical Weatherby past week, Chief Strategy our Sparks Chief as and Carlton the exciting the of as Dr. with our we Officer. Charisse Officer Over additions announcements some shared

healthy, large the on with the see to strong As and adoption market. in the talent joins where growth leadership of need and of guide a Division. focus sustained, a we expand business. be he to continue therapy brings our to of obstructive invaluable we apnea experience wealth increasing Manager under-penetrated our we will our of tea., He that organic continue Inspire the is of years from and market, sleep we us Spinal us. business, many was Medtronic, as ahead General scale OSA Carlton

experience the oversight patient is liaison a Sparks direct lead physician with business outcomes, experience, high-quality Dr. ENT her untreated with board She serving extensive Inspire Inspire's sleep look forward patients and of board-certified Dr. to role serve with contributions ensure and will Board and as physician as executive toward provide a to In program, leadership director. Charisse's OSA. the our communities. transition Sparks mission of the from will Directors. current appointment, a and connection We Inspire including her Carlton clinical for with on many

increase quarter review results. revenue second let's generated $XXX.X the we quarter, to million, second that, With the XXXX. representing XX% a of In our compared of

centers and existing complemented of continues centers. driven new is at by higher the growth be by Our utilization to activation

are increase million $XXX to the we to XX% revenue business, $XXX the a seeing Given momentum we to range to be strong expect in XX% in of now XXXX. million, full our compared

centers the ending therapy to second increase implanting demand support in quarter, U.S., the centers. X,XXX quarter the of capacity our Inspire continue new by adding to a total with XX the In strong we for

centers centers to to For the to per XX expect of XX XXXX, remainder activate we quarter. continue

we bringing U.S. XX to sales the Regarding the team, new sales our total territories quarter, created in second XXX.

of quarter XXXX. the U.S. sales remainder XX to for per XX add to expect to continue We territories

summer slowdown contacts, number million. these physician and conversion had From the we X.X contacts, therapy. improved over In surpassed visits, website of we in the typical to steadfastly receiving XX,XXX second the visitors of quarter, even our our patients with

advisor numerous enhance of patients this how make our to our website year. to engage our the with are and to changes scheduling for the continue continuing increase Further, consultations we website program, designed we digital for have use care later in Inspire We works ACP. to a new through

previously of Inspire entire that on the will surgeons limiting to one provide providing the of believe physicians these both qualify focus new end, factors perform programs surgeons and the capacity patients training Inspire through procedure. and time robust We To of procedures. are implanting performing with mentioned therapy reducing support to required journey. of to time the focusing this is adoption the to Inspire ENT we the areas We additional

example improve study, PREDICTOR the DISE, an reduce sleep experience replace to ongoing surgeons is airway patient endoscopy, time the and which exam. our or of with the drug-induced One to designed office-based a is burden

from We have the BMI. enrolling with quality actively of are second patients completed patients the and first a higher data checks the XXX XXX group

results publication these that be in the set fall. data a from We and will preparing the be first moving will presented toward expect

the of continues to device and improve, the link between Another journey contact the this of post-procedural platform initial example to as longitudinal of launch through patient utility is Bluetooth-enabled remote, growing Inspire management patient the from patient is streamline SleepSync system the diagnosis, recent The to SleepSync. the which relates highlighted designed management. patient SleepSync by is the adoption and system. implant patient's

which pave SleepSync patient second is U.S. will activities the SleepSync the The provide approved physician physicians tablets log technology own Programmer, Inspire for physician to stored step view this early will necessity in in and the will remove remote to staff from was the as and to part of programming launch called and the SleepSync system programmer, system. quarter and the our in access screen in the Programmer allows next in patient for XXXX. future programming launched, The Once way their all programming. FDA formally their by new computer the

early process, need the for sensing X Inspire supplement sensor respiration the incorporates Subject eliminate Staying PMA review with product accelerometer neurostimulator is the submission the XXXX. an using excited in to inside team the Recall, to development, FDA. the pressure Inspire to measure FDA's the and of approval expect the X announce lead. our will to we

from second Further, transitioning BMI whereby quarter device, enhancements clinical, we the received introduced. platform indication product an our beyond, as research, regulatory to to further approval in FDA Inspire events up in with which will the firmware will to From Inspire such and a X the viewpoint, upgrades from to and XXX be patients XX hour include XX. enable a to auto-activation expand X up raise BMI labeling is XX warning per and

target will be enrolled that a registry moving later the and software patients into of will happy are we ADHEAR as ADHEAR system the of broader integrated forward, year. patients this to SleepSync Furthermore, announce and X,XXX part registry, into the included release which met X.X has its be

hospitals A national quick increase to as Medicare an payment about showed to an to to new about reimbursement, of $XX,XXX comment proposed on $XXX rules the the ASCs increase and and $X,XXX published OPPS recently of $XX,XXX. were for

final slight rate payment is increase highlight which reimbursement tied facility rules. a the of $X,XXX overall to in also RVU see which increased Medicare proposed, We procedure the from the We [ph] DICE payment. the but November the in do significant to this rebounds physician for by reduction the typically $XXX the

this to by continue to Therapy to the varying of challenged but migrate in continue of see about rates we Medicare up ASCs more make term XX% number the setting, ASC is centers, reimbursement different our longer Inspired total states. the Today, but

is south, have cases lower, this reimbursement Medicare seen especially stronger to Medicare hospital two also the rates last a in and in We rebound the outpatient cases limiting quarters the over with setting. the Medicare

an site OR the sufficient term time we procedure. long able as Inspired service programs for ASC While education reimbursement in this obtain ASCs we as and hospitals, focus are of on will to our for see efficient

Finally, through strong Medicare the the we are balance heavily as very the year. will we commercial we while more expect happy rebound, progress that towards cases shift with

business, team a Switching Switzerland. supported This achieved a Netherlands our performance driven Germany growing XX% in strong by the the over very European second quarter prior year. and over successful by growth was international the and robust to

ahead. seeing which are countrywide Belgium, in we the look reimbursement finalized excited quarters earlier We forward building about year this the very are and in to momentum strength

France for there the expected prepare pending about We manager are year. in continue this also we excited announcement later our full launch to market and reimbursement final a country new

training activity with sequentially made this region. progress in in Inspire the and advance Asia, are completed physicians we showing are Japan, we by significant In with have going reimbursement website, team efforts Kingdom to and additional Finally, and hiring have United members, great the therapy receiving of patients momentum and growth seeing active additional and increased In with we procedures centers. expect seeing both year-over-year. Japanese Singapore in direct our continue

and stimulation progress Regarding with operations, sensor ramp remain with position production sensing a We yields. of silicone-based we challenged in to the the leads. make manufacturing the continue

have inventory the products. quarter. incorporated and in feel place short-term by recent We through year expect manufacturing other in about We to our a in with of move grow goal position end. to inventory to remain change of plans a position as positive grow quarter one safety we stock However, we inventory our good our

to patient In remain and education in focused continue physician momentum the of summary, we We on adoption continue to therapy. outcomes our our significant business. see

long-term appropriate are adding to have remain stakeholder value. utilization new place confident about our at extremely continue our to centers. opening will increase excited in by strategy we We drive and while prospects We the centers existing capacity future that

I'd like turn Rick to for our review his that, financials. With to over call the of

Rick Buchholz

primary growth was the afternoon, the the an number prior second the centers, existing include Thank $XXX.X revenue XX% for of the year quarter second territory the everyone. XX% new utilization from marketing, XXXX. in in in million a quarter from and higher a the U.S. revenue generated implanting managers. centers. of our $XXX.X the growth in and driver continuing you, was U.S. second at increase direct-to-consumer of Other higher Tim, The Total addition period. increase $XX.X of drivers quarter good $XX.X million million, was million,

announce a the price to The million, revenue of quarter in to uplift was in We that is the increased which began period. reported on reflects U.S. year-over-year grew units The average increase sold year XXXX. outside outside compared XX% in are prior while the U.S. $XX,XXX second $XX,XXX, May price pleased basis, X% to an XX%. U.S. the our $X.X selling increase

the ASP quarter, was We during ASP steady U.S. compared in to the quarter expect the current outside The U.S. remain XXXX. $XX,XXX of the $XX,XXX level. second at to the

the in now certain quarter period, effect. in prior of to costs the process margin additional parts, XX.X% component partially as in costs was lower higher prior yields, to and primarily of is which manufacturing sensors well second due fully to by increase, XX.X%, price the offset year as compared Gross enhancements,

to due increase reflective were quarter our $XXX,XXX a our and costs. an in was expenses expenses prior of of ongoing year The $XX.X XX%, million key operating on increased was continued the as higher our corporate the marketing and This to sales increased of long-term business. increase make in period. $XXX.X programs, Total growth compared compared development in to ago. higher expansion quarter, the second in to of for direct-to-consumer organization, our general investments drive second areas cash efforts, to million, operating driven dividend second planned is balances XXXX. interest the plan of continued income $X.X quarter This by product income million increase rates to totaled Interest the year in and compared

quarter $X.XX compared net $XX purposes. that period. to accounting to of associated $X the the per share Net The in XXXX. quarter was in expenses the loss expensed million with prior the to inventory X is includes quarter loss net Inspire $X.XX second million, was pre-launch R&D loss second second million related The compared for net for loss $XX.X of year for

outstanding number was the shares average million. for second weighted The of $XX.X quarter

average the third shares be million. quarter expect $XX.X to approximately We weighted outstanding

new March Given training $XXX our growth executing leverage million while investments from This position allows cash at our at and centers of increasing our $XXX increased June at us centers. to implanting strong opening remain and cash XX. strategy continued to XX, volumes on existing operating focused improvement, million procedure

year year million. business, we Moving $XXX compared we $XXX updated revenue. on our our $XXX expect strong full seeing guidance given previous full of revenue guidance range increase million guidance, from updated the now to to of to XXXX to growth are XX% an be in represents momentum the revenue This to million, XX% XXXX $XXX in to million

patients and half Similar we years, in fourth see reset year. to second generally high schedule increased deductible through of the we the progress the health at the as attempt to plans the procedures before prior seasonality beginning year, quarter of as physicians Inspire

of XX% margin the range to We continue to to full expect be XX%. year in gross

to XX for XX business in XX per XXXX. As remainder the quarter sales strong provide performance the to U.S. and establish expect U.S. of Tim our remainder of new and to centers for we our with us XX noted, In confidence activate conclusion, territories momentum per outlook quarter new XXXX.

our prepared Dilem, now line remarks you With open that, may the concluded. for are questions.

Operator

line Your open, is John. instructions] [Operator

John Block

but Hey, guys, the from beginning, its go. maybe John guys. didn't I'll hear Good Stiepel. afternoon, I

Tim Herbert

the hear beginning great John, How are have didn't I you. but to either, you?

John Block

Tim, I'd chatter going GLP-X, to up there's heck? I'm jump both or lot What certainly figured, front. the of concern. I [ph] just in. a ask

lot growth time. on opportunity an that's get I following for guys OUS So, that And Tim, how specific specific to more your anything you but for the there And you Thanks. inflection you've for Was the sort to or you know of this quarter quarter, the of point maybe while, the arguably a play, or question, is view? big TAM?. you second know, number. arguably, materially from been view out P&L, international altered been do the picture, a forward? see for working maybe usually funnel, upside big the to is the going second downside, some and this companies, a the doesn't then I've the playing business

Tim Herbert

think You wall the address that very action We're it's forward. base it's to you. mechanism bet, discussed don't lateral associated higher Inspire is happy to with tongue of We Again, is We that Inspire. patients. GLP-X thank BMI concerns. GLP-X. with collapse the move specifically complementary

this in. before. sink about Let that We've talked

lateral to they of treated hypoglossal by will lose be the which patients of When tongue collapse, and can their lose mechanism patients of by get Inspire walls, we in weight if is effectively lose higher tend they GLP-X wall with to a our drug neck Therefore, is BMI and addressed highly it weight, predominantly obstruction, there the which the relax go weight, which circumference, base will lateral on outside nerve. stimulation action. is

field. action and collapse, each see So wall but drugs again, by GLP-X have indication, but to physicians, research a to treated do don't GLP-X Inspire we We weight. own movement be two to little going Inspire, highly At it's project lose the a haven't welcome the lot of so if being progress a the of and care patients weight feedback start out lateral helping them towards we hear of of different early, of mechanisms a in point, them. to beneficial. with take we this complementary the that's in very the and can it's opportunity seen patients our our solution, as but We lot they the longer-term lose meantime, address from moving to

don't been a had that we're Germany, rebound. seeing strong established success a we've we've International good and now time, coming country. well John, great great had in of investments and following exciting, a is Inspire after very the always we've quarter. a until reimbursement think seen and international. in some country said some pathway quite case progress you've we've we there, as strong what I is we're in make for COVID, And Germany's

relatively are overcame is countrywide centers, which out The some we to the and France, start will reimbursement. have to strong cases. on expect the in opening countrywide there. provides can but exciting do new Netherlands reimbursement growth a coding And already launch They up the we we challenges soon come second completed there, they their in as full half announcement news and Belgium. a have new reimbursement schedule the so They

Japan really forward activity what's future. happening. and the progress, going We said, in as well markets, So is going is show direct to international on in more a we doing markets. the And reporting The Singapore, good starting well. Asian we organized. to really And the is look lot in team there like then in

very So thank much. you

John Block

Thanks, Tim. Thank call. Great you.

Operator

from comes Robbie And go I show ahead. Marcus from of our JPMorgan. question Robbie line Please next the

Robbie Marcus

the congrats really And great. label Oh, Maybe quarter updated. here. recently a had you've start, on to nice

in severe to more the you night can the forward. it per you much how two market? in Can as a And on guess GLP-Xs, episodes BMI apnea I more helps addressable seeing the the increase about an I lot what and you're last this talk going field treat whole really can with and imagine touched your with You XX. probably but of sleep raised it the combination impact

Tim Herbert

Absolutely. And thanks, Robbie.

in also as we of tied the are is already for facilities. those go, opening As well, that Inspire with label approval more and and existing recently updates children's remember far a received Most pediatric centers. Down facilities going syndrome along we're up

So we of can take those care kids.

The index BMI a up immediate not of a have hypoptic XXX. just a patients for pretty those for XX to there's update higher that options label introduction. going because lot is above apnea

the And us with so get that company. approval really helps the insurance

going pretty procedures a So a We're in increase bit return. to there. that's immediate right see little

do a to got of we've just of little XX bit lateral bringing be having as because which a concentric up because moving presents collapse in BMI, complete a careful tongue probability and the when to little tongue-based a with you procedure about BMI treat that anterior-posterior, the dangerous. collapse, with we patient forward. BMI them remember obstructions the Dice is again, a wall a

not of being a careful we're the qualify who appointment anyways. So won't books the with with ENT high for higher Inspire to BMI, patients BMI very surgeons fill

GLP-X some weight, the with treated are us tongue-based that allow assess and good walls, lateral can them properly collapse those be patients you the the help Now, drugs, to Inspire. patients will, to our relax will be get to if if on lose

the summarize, So be BMI indication expansion. of an to is going to

current our system the first, being but past a now that about of increase the TAM. and to about be we the little albeit takes our going that wall, as we're market published talked it lateral doesn't to we've the drugs. BMI, in address a advantage GLP-X we XX% because think over lose time with I careful of to the weight about to be know well, they able need have treat bit

Robbie Marcus

one was X lot spending. it was going But step-up. clearly, on $X and great how in versus There the million and a the an so or for lot. called R&D and maybe inventory maybe And just of on about margin a give you Thanks on build-up balancing Inspire us top-line profitability growth Great. in I think views out, leverage update thinking you're forward. accounts

Rick Buchholz

Yeah, hey, it's Rick. Rob,

leverage our important, So but in yeah, create P&L, and focus we understand to adoption. continue growing growth is and the our is profitability we top-line real

manner. So in we disciplined a invest do

do made have We've DTC, our but with our we We R&D, that. operating all continue in investments to expenses. improving and of areas leverage business, our been

XXXX, components our XXX that X environment is expect fine get of basis investments, we remarks. first X I confidence XX% current as in don't quarter, but points accounted tremendous teens R&D or the We've mean about, into a talked of in accounting as revenue. purchasing for revenue. of was the as the the be a recorded that revenue to details in prepared now, Inspire the in supply purposes, we expense. actually, approval But quarter. but chain of for R&D It Inspire XX% the to but we're be and that, must Tim about in some are our it talked making R&D in macro given percentage high so, of second

We're taking said, being by number. $XX was cash. compensation generated that quarter, we've million, That a nearly and cash positive In so $XX is million. the stock-based big out, it

profitability So will come.

focused long-term the we're We top-line really our on growth. that,. but tone on changed haven't

Robbie Marcus

Thanks taking for the Great. questions.

Operator

you. our comes from show ahead. line next the Danielle go from Please Thank UBS. [ph] Entalfi of And question I

UnidentifiedAnalyst

on the wanted for a everyone. from shift patients just on taking follow-up quarter. strong afternoon, really physician so It's in the to good Medicare little much Hey, ask given question. a Medicare, away the payment. patients Thanks proposed to a bit the question great I see. Congrats

patients today this guys this question meaningful, think also, patients the being and going what I first cautious? have Is percentage OSA So should and how really are what about is, you forward. this Medicare, then of we of Medicare your overall just or is percentage are

Tim Herbert

Sure. Hi, Danielle.

back XX% military, think to to has add up and XX% But historically about that XX% probably commercial, X% we've Medicare, doesn't we in we XX% our quarters, been insurance of Medicare, seen and XXX%. VA heavy rebound. purposely to last or the blend as I always Medicare Medicare again, about have in couple plans. Usually saw in the we good going QX, the deductible to the commercial because high see high QX, a

just so percent, it higher approaching we saw XX%, not QX, in QX, a for quite but Medicare. And

in So or while ASCs, challenge. north, setting that's in to of population, does kind present that's a ASCs put We're all but some able highlighting. those handle longer-term the it really challenges exciting cover in reimbursement in and that cases we're hospital what for to the that does a and

becomes really and again, towards drive quarter. certainly high kind As into highlighted, Rick more of it QX, we because commercial QX, as progress into weighted the deductibles fourth cases, the

to So I to move ratios. percentages our back traditional would more expect

the obstructive XX a we And studies our is then saw studies, the clinical commercial overall, young down during person's the disease. sleep were apnea early in of age And at average years.

bit. But in reimbursement's in course, a youngest rises Medicare, of average really now back have age. the little XXs. Of The age years up kind so it should that be approval. pediatric is just Remember, it think person with the single-digit we we of the easier

we on the and part, complementary the I to provide want think patients, to and across the the military. we're ratios most on service with focused that the our but treating VA So always side, certainly keep board for Medicare commercial

UnidentifiedAnalyst

a then there. of or much, rollout we it. launch so and margins as impact congrats that. guys. gradual Thanks got about we a should [indiscernible], approved, X in Okay, think to think on Inspire capacity about should of that ahead is And how building potential Once that

Tim Herbert

Thanks, Danielle.

improvement lead. an for improved for of think comfortable makes I the the reliability. throat and the surgeon and are surgeries, a more excited to Inspire the small Even patient have number the that lead the Obviously, culprit is perform. procedure an ear, pressure-sensing we is It though people gives us pressure-sensing of revision most an about It nose for patient. of removal both X. those

to as in market the can. it and adoption SleepSync to be transition we will believe a we be and to the this. it all mid-year, expect very sure board. able the well quick we a with by we'll system, the as launch works on the once sure study go want do launched, small into market broadly I'm Once soon new approved, across out to this pilot just full the we make get remotes, So And

Operator

you. And Securities. next line from Thank of I question show Steed Travis Bank comes go America our from of Please the ahead.

Travis Steed

a Maybe on thanks Hey, things replacement hospital with up outpatient reimbursement uptick the needs Congrats going replaced. the big good came to a on if a that quarter. few in lot. be out and recently, a was there procedures the reimbursement Dice them it

play Just was how if seeing expected, out and in that, should you're curious that that business? the how

Tim Herbert

Travis. you. Thank Hi,

think initially know or and ASCs that have do wasn't XX-minute We or reimbursement was, came that been disappointingly worth procedure hospitals out a sleep they I to for procedure. $XXX it it a surprise. be that to on low in very endoscopy was increase at just nice working when the able it what was

kind ENTs the Dice. providing procedures. Predictor spend reliance OR want But than that suites time to up, have that other think from the for go and drove and years, it We'd exam. procedure. to really I done hand, implant talking Dice as moving to couple is getting we rather centers $X,XXX the that to to brought actuals going be we the over the the our rather be study, doing able beneficial Dice last reduce it on Then on calculation to an of economics anyways. again, the the with that got office of actually

and takes in very reimbursement happy about be sure will the equally I'm So that November. when and the there effect ASCs centers excited all

hospital for Code, the of far procedure, continued Inspire tied year Ambulatory increase increase several overall increase to As happy year as the Procedure the pretty to that's an over APC, last steady that's very years. and the for the with payment again, ASC been the and and

address just again, Medicare north continues ASC but the and So in move to this. ASCs, have good hospitals the we just payments it that's and to for really

Travis Steed

and Great, the you. you QX, thanks color maybe the QX, of the thank summer on of just talk that. And margins seasonality, any be that'd could about and helpful, both for kind cadence revenue year, spending,

Rick Buchholz

Hey Travis, Rick. it's

we the with the as talked achievement in the and we're So the and of other year. all half and the the some warning proud BMI label we first of the catalysts. talked about, team about the change of of in really changes opportunities

we to to guidance XXX increased that we XXX a the we our that, the this and about and prepared step generally given I those up so high talk see mentioned reset in remarks, our So schedule have year. of in fourth to the patients before deductible the procedures in year commercial and with mix physicians at attempting those plans the beginning quarter, strengthening the

to We continue increase will our spending.

We have shown leverage.

progress improve that the expect year. We to throughout as we

half second the And in so the about will excited but we're year, of there be strengthening a quarter. the fourth

Travis Steed

again. congrats thanks lot. And a Great,

Operator

Adam go of our Piper you. question Please Maeder ahead. from from comes line Sandler. And Thank next show the I

Adam Maeder

congrats was to you the quarter million. Tim, and obviously a this next Ezgi, if the to ask big Hi, questions. asked for increase in about the thank Rick, apologies $X and OUS the taking wanted business and sequentially earlier I Q&A, but on

this a is to is, watermark? the question in Europe kind drove the performance out What call a the follow and then anything and standpoint new competitive So up. of I from Thanks. had

Tim Herbert

Sure.

I the want And of most in think team. the Germany that I the growth. and in is of the drove really strong it Inspire performance. compliment was really to team. down focus Switzerland to the do rest the of really to years. the for able new also very did Netherlands the and in That's And very, been several haven't Netherlands. we with market centers, something stock opening strong. also

yet. still the That's from We forthcoming. performance haven't really Belgium seen

have the They're going see Belgium. to national of a with half. to going coverage You're implementation in the strong insurance second

to that's to So going north. continue move

UK place. working reimbursement the in we in is on that France, but in announced the and promising. implants, codes done will their has this additional but open when centers coding were up that that this the able previously the set, countrywide through which in I think registry, we're equivalent UK, to is awarded sure it publicly now lay they France we have And really CPT out put make coding France, to the CPT

in happen for half that a the really in Europe. Europe exciting do in largest is expect that to We latter which and which will launch the year, time markets of so France, post-vacation one obviously of the full is

we I there, to come. very, the impact still the No driven and And progress reimbursement of comment has yet to to not what's really business. on kind Europe, that So competition. countries. going of introduction have good continue in really strong. think really over by is that's while the upside moving it's those but sure I'm very on us any is the drive team in

in later year,. the And

you're over to think progress Asia. from start I see to some going

As Singapore is Japan, in really in seeing the coming markets. we're Japan, well to is in start to through transition representation and which our just going that really the activity we you're mentioned, focus country direct and Asia doing

Adam Maeder

mix update That's be you. you great, you for that just have fulsome remind Tim. difference guess of about now the the part U.S. don't. on you that and gave digital this of the us if And the that second in between of on in provide the an follow-up, now curious Thank update I'll scheduling for centers ask the I and are I'm tool. number response right utilization an just there? can Thank ASC tool that quarter, would and centers a terms

Tim Herbert

that's We're getting They don't when because in trying voicemail we're appointments. now center a the scheduling, for it's to at center are still of using poor those and the experience of patients. digital Absolutely. plus through centers probably go tool exciting XX the good make right about really the pilot but

centers we going push continue with scheduling. company we're second entering So software that the phase where digital interface into that. additional can our of their to We're to partnering add to

what's there. that's happening So really

think utilization because centers quicker I going forward pushing centers, the higher those second streamlines with of the really going we're question? be again, with that some to top the obviously that that mix. just, and ASC process

Oh, ASC mix.

and driving Medicare work Inspire. think And ASCs dominated ASCs Medicare they I to the commercial with they will where progress Medicare a need setting, to their down levels more our sure mix just. to higher for ASCs. contracts a but think commercial from progress we be be especially the rates and as Medicare standpoint hospital bit reimbursement long-term to you'll on and more back a provide we to have to with payers down that the we higher the quarter, reduced to But mix need make comes have through negotiate key to is vision that that ASCs. progress Medicare proper education in and continue little the south I we they as really rates, and commercial business for tends and see it catalyst that when between the the

Operator

question comes next Richard from And I you. ahead. line the show from Securities. Please Newitter Thank of go Truist our

Richard Newitter

increase quarter. in Nice to efficiency. Maybe job question, have on past, all good my first talked about you another I throughput initiatives you've that the these know

them is One of physicians getting more implanting center. per

or the quarters? few kind you of have where an over So, have do percent about than more And on update think one you how installed of should the your do that next we -- centers base that then physician? think

Timothy Herbert

specific routine have a your to number as grow. reps have a to primary a backup. that's or have continues absolutely. to when one, we, want And I away for is backup? sure factor go to don't in just the perform that you. we always a Who surgeon procedures, a measure, goes make backup. If We number unable Yes, is know

have always thing service. -- The our a of look of other multiple surgeons at sites is we lot

at can ASC procedures So also but they hospital, do an a they at have per se. backup a

multiple A an hospitals ASC. lot of surgeons have and

in as most multiple forward What active capture they as to facilities, a part program. surgeons we is they sure what fellows very to make service, about graduate making have and surgeons they're into to we're going. we're sleep have first and very the have go the their ENT of really that want itself from jobs we're their So part, excited they is training counteracts for And get doing kind standpoint. surgeons them of start We bringing is multiple both job to from focus sites but their Inspire actively most getting point them. of their practice with we experience really Inspire on so most sure before the also that

exact And fellows we -- not both ENTs the just quite we're of annual sure on I'm -- had finished and a sleep. numbers ENT course, in doing in We looking we're year, XX% few the sleep those but with year, that, about our first and of do being and procedures this thing that physicians. that to their ENTs at Inspire conversion able graduated a surgeons goes same those again, forward

continue to going we're and school get medical Inspire So forward to level. expand program at that going taught more the

Richard Newitter

But number in elective guys trend. I'm first which from It's results? pent-up out is different huge in as underpenetrated back the to TAM. And And generic procedures utilization so been this to curious that's come above half, are, of standpoint with you're extent into to strong into seeing for then I move contribution or the there. backlog a are you the we kind the know you if to respect support of question a in kind strong any a what of situation, outlook and a backdrop demand half? continuing the

Timothy Herbert

are. we Yes,

of same-store in think I I we're sales in Obviously, we QX, as our as forward. so will and think continue continued seeing it all growth QX, growth across move centers. drove to did the do

which we're think we come overwhelmed the that strong Medicare of in that commercial second the little saw cases, more excited, half. about that bit of pop kind the on I will And quarter. I with in a think second again, the

So the be there. to demand continues

to As TAM. procedures. the we continue the surgeons you in underpenetrated Rich, we limitations the of have And on mentioned, be number still performing

work that address we to the continue of still need and to backlog So patients.

people of. have -- absolutely, from step care Demand effective. sleep want and be taken in their very our obstructive continues to direct-to-consumer have But to apnea

contacts Our high. are

got commit continues by their to conversions continue be patients. ENTs to to patients up and of these just open getting to strong. Our time more through more to of training OR We time implant and efficiency

Operator

show from I Wells the And Biegelsen of question from Larry next line our comes Fargo.

Lei Huang

It's Lei calling on for the in Larry. quarter. Congratulations

the the first closer your on grew half. the full guidance you little XX%, by to line is Just implied than over -- growth revenue whereas the seems raised a beat. year revenue half, second top guidance, in more the you That the XX% in

So conservatism follow-up. just talk confidence I something if second deceleration? in a the just Is about outlook? half you there than general and can the have And why other

Richard Buchholz

Rick. it's Lei,

our guidance strategy. changed haven't We

We we stand about guidance put And the behind. in commercial. we did so, and talk believe mix of can forth we and Medicare that

strengthening of the enter out the of fourth very will on with that so, the in we're of procedures quarter. to that, the as increased how similar our into And first revenue we kind proud for so half have year, we Despite we said, really guidance, previous commercial of year. roll a and expect real years the Inspire the team

Lei Huang

Got it.

close million sleep Okay. Tim, about just even be in second apnea what just or interest as has portfolio, sleep And Should either inside cash. Strategy the that read that my expanding in question, then of The hired, increased perhaps will Head we you company talked apnea? to $XXX new you focus? outside an his your of

Timothy Herbert

a where question. scale Great grow, from be is Carlton our I talent. Sure. continue definitely to able And great you're to to And need we that we leadership business. as that. coming see

the investments Inspire. focused not of That's grow adoption the tools that technical are past on in changing. us Our help can

balance to sure changed And yes, have going treat a to making focus the apnea, has there. on at nothing we're obstructive I we been Inspire think successful strong sheet. we've building business sleep

the clinical our our with revenue integrate external sleep keeping operational instrumental patients overall our with Carlton the when to and whole. today We're our plan and to evaluation, and with in to just from is to but our go with as Ognomy apnea in look make like, strategy to again, this have us annual be organization with looks remains But and as able going company what appointments we're SleepSync need quality focus. adoption a help in organization focus and physicians EnsoData billion But not our the we we from tools leveraging only helping $X understanding to Inspire, obstructive growing of be does like billion, what overall and $X team our side, our system.

Operator

show from from the question And Petrone comes our next line I Mizuho Americas. of Anthony

Anthony Petrone

be then toward follow-up strong out there. just stack strategy latest And a to against Congrats sort on quick gen a a how themes of system lowering that two be, there where clarify existing the even patients BMI, the at when of up but the here. the potentially up for rollout, quarter now for just concurrently, eligible can with the bring quick on when pricing would look will look label now as one it another hypoglossal Maybe systems we we X, into would Inspire how those for of patients XX two GLP-Xs actually to think nerve above you contraindicated that expansion out BMI, BMI many category stimulation? XX they

Timothy Herbert

it. Got

strategy out, again, and this pricing because, launch that. selling comes be be will X evaluating we -- when sensing lead our the a still Inspire pressure moving as won't far will As that change either. we're -- what be It we

time of a We're come So little on bit that. evaluation. doing to yet still ongoing

and improvement, only the in said opens beyond. and always tend price but to allowing increases X, strong do is with go that Inspire this certainly up us VI with to platform, we've VII technology and As past to we it not a improvements, technology

the So a lot more to and in future. come back on report that, we'll

GLP-X, as yesterday. note out far a you As put

That with Inspire on You to in GLP-X what how was is very doctor. do to a weight overall very intriguing interesting did and regards is do with it's loss a a going take addressing call going their discussion. with

know X/X when I larger seeing above over well think out get due of XX, patients circumference. we can what or you with the is, collapses BMI collapse a that to wall concentric we're associated about neck lateral we screen the complete

we to higher. XX, As XX% that's to even to BMI of go or up of a going screen when XX, you're

will to component weight to And the The key we're sleep number apnea, patients when take is going so, up help at time. the it Inspire and there, business. them obstructive be relax to that's with lateral able the of have able impact a wall their be, of if the you lose look can to going on GLP-X just to significant

report I yet. not a to seen that that highlighted your you've date think activity there's lot of

on a in subjectively GLP-X, field do know future. but heard the that's coming the haven't We from with progress we lot made

Operator

show I line And from next Rescott our the from David of question comes Baird.

David Rescott

strong on here. the quarter Congrats

Or approaching the kind maybe driving about first more we or are bell of this those driving segments? be the a and is think physicians wondering Just about end, utilization -- then on lower when or maybe those maybe range, maybe in toward that -- from that, that level? coming end somewhat of are range, curve less that kind centers there broad but of in think specific the of when of those I'm what's centers? of utilization higher we out spectrum across utilization they end from is kind of upper of centers? of it And Or improvements the end of not or still capping may toward any the what's one kind increasing middle coming U.S.

Timothy Herbert

-- don't question. for the I thanks Yes,

far I that a and programming can can of their of focus patients, utilization. characteristics think We can the to sites, of as is about as ways quite is means have And team. lot a what the physicians rely they device. aspects on longitudinal surgeons who a go will the the key on of practice higher-end talk the still we and of the the do lot management characteristic of those sleep the

easy see with And process to the from implant, their so what the the initial know highest patients patient, centers and to and the does multiple utilizing for through who through the patient have through longitudinal team well-defined it's screening management. they the surgeons a have

the to have think try is key I tier to to kind that's be tier and X of able the sites got a you've team. that we with the X educate

certified and our have the those with early those transition are them sleep capacities respect the have outcomes. partnership have since capacity. patient we the also to adopters. need highest ENT board a have in here to little They've who dual know great But highest physicians sleep what's they And help with surgeons build beginning. is their who surgeons with because friends are We bit for been medicine centers to very other us really important the

the Everybody everybody what know they outcome and at facility Well, good a that's natural because experienced, at is their knows facility is. patient job. the

And And you well. in so, that pushing report on I think keep that we initiation highlighted utilization. your as

kind utilization I move pushing as that's we're key going really keep is of to a forward. we So think

David Rescott

top some to around one extent wondering, BMI I the towards second I'm you us or from of BMI, guess, thinking the I the provided expanded the which know guys you've just bumped offering the have of labels. broader able given anything a anecdotal on or comments Just more funnel, I guess, to little therapy But there. maybe more been the up less number just to maybe you're the physicians heard labels considering bit? around of margin that at if those a see, patients, impact

Timothy Herbert

BMI, payers population physicians other important high to on made on That's as other working right away. absolutely. that. We be things, BMI High well. options. their key The that, commercial including the going don't We're sure approval with amongst pediatric those all update the just the about patients knew the an because many have policies to is

being complete because the of As or far have patients fast as careful as wall out lateral the very probability collapse. ring concentric procedure collapse the will higher screened because the GLP-X, high BMI BMI, about the been jumping with too with a we're high the being DISE we've into talking about those

And think the can the those those GLP-X concerns from -- benefit are we the patients are drugs.

in hard more pushing So the careful also PREDICTOR. BMI, key on with that we'll DISE with hard transition Down BMI, and then component future talk about to high really we're syndrome, payers. very near a pushing on being about will be pediatrics of very whole That

Operator

next line question from KeyBanc. show comes And our I Mishan the from of Matthew

Matthew Mishan

they SleepSync? new centers reimbursement centers towards kind you're are where how and adopting the remote many pathway talk of patient some pathway And a are kind about are adding that -- wanted the like I SleepSync, to monitoring? for in little larger the bit in of then of and also of where these

Timothy Herbert

is older to while new SleepSync a SleepSync. back add to going we to that Bluetooth can the are provided directly centers quarters, to are utility process is The the the on we for for several year that with and last view real-time last have as them system big a put really SleepSync to process. When centers physicians now launched patients providers their question. the train new doing. the our open of so been Great SleepSync. the how automatically out change was have being interface And trained centers, the and of the It starting remote device patient's have those to healthcare

the the this goes, taken mentioned, But year. the and all the We they're as And to upfront. it. standard will to smartphone as implanted the new far next the of patients' is part automatically with new and to beginning already going to communication. are sure have in the that it's able be introducing quality stored be patient's have SleepSync. patient going to direct such a from It's the actions monitor as all requirement centers physician And from part product we right programmer of to launch sensor to record information patient's we're via the that SleepSync. transitioned train goes of a in physician that SleepSync. we be mattresses approved, remote them we're as of necessary of sleep tools under make And programmer All

the sleep, to uploads do their data patient to but We're have from office as to of physician's a that. not be to the with feel in-house. they'll on action have? be subjective input only the when already We able are going And in all-encompassing is Is communication SleepSync. to That's after that's next management they well with the working working interfacing of then And do with going already the a with going tool evidence to SleepSync tremendous. with also telemedicine, programming. on complaints our remote going minority investments, be patient's and Ognomy patient, this is EnsoData, right? them? it's We're FDA how taking they we're start kind to so to they what SleepSync from data do be, home automatically everything for What fine a able objective that patient step be to quality going

So key going forward. that's to step going be a

Matthew Mishan

ask new basically from practice? is your sales centers Is to push you're Or one this to last asking a this just these all I'd on need it adding. we force? really these saying one centers add from pull that a our or

Timothy Herbert

well. and do see lot a Well, that they as are creating brand, to are yes, we we're direct-to-consumer, this come still patients pull physicians Where as see a we our today, website. of we when a our

know to They me We to as but haven't family well. mentioned programs website this doctors, -- those need how we with at the we patients how to to "Look, I general refer process get going today, my practice So how family with patients general large outreach to to is saying, on have educational and or ENTs. to doctors our their my patient." this, talk about all ask practitioners, a practice practitioners to see communicate their come patient they

we from sleep do support have Do a with that on this -- kind And who in of them sounds our C-suite? from team? an so, we first are OR the It's we your you that the endoscopy? demand kind are How you Do thing we inbound is do into get is? ENT? that fill application. know board to navigator? come call Who proper functions to sleep today, still out tied identify utilization. the an who practices? Who's organizational come the outside that a we really on is center the but the in have need key is Do responding we it I practice. arrogant, make zoo? we're helps to What when sleep have it's of have And going a is centers So all and them necessary be board high we Who an for coordinate not. physician? form the to

capacity bringing we capacity yet. early that patients, or yet. we're in the still just we're where -- So centers cities in stage on in to have and don't We need

the So we need centers grow of we're to number that continue to training.

Operator

Oppenheimer the And from Co. our question line from Suraj show I of last comes Kalia &

Suraj Kalia

quarter. Congrats on the

you. questions throw them all So Tim, of quickly, I'll directed all my in to

on drop right? can also. high in change? about pulled to on talking and patients do XX, they're look GLP-Xs, are I the curve, were that. XX to us going you appreciate this you comments comments your look lateral net Tim, as collapse, Because your that BMI XX, So color. upon I about walk getting How the Maybe appreciate I a -- upon through X-tailed You

the outflux? I'm how you what that's all do curious So stratify minus is one question. So the influx

please if -- second I The me Tim, me and ask stop again. question,

even are Second would stim nerve be haven't your currently what question getting tried a but CPAP? percent patients hypoglossal of

otolaryngologists, in programming the neuromodulation, field component, sort can remote example the And our you about I handed They disconnected reason whether where the they ask least it us it's done, programming and also give this remote specific and general been of I is with programming And you the at anything? off. past component talked a are has of have offline.

just I'm if So in curious time, walk through. remaining could, you me the

I threw of those, answers Sorry, be any and questions to all would great.

Timothy Herbert

No, really all are really, those good.

Let me go walk reverse, but want of in kind through not I -- to. I'm going to

DISE lot only The base on able have and And eat Inspire? patients that practice tongue question. does. endoscopy and patients a very high collapse. Okay, to it's sleep you on and a a up to will good ENT's BMI Inspire. the as everybody in lateral with to have on go many It's have why to see And they we're you challenge being careful highlight, aren't this, a why BMI how knowledge this. the of That's that with patients a and to about right so that key much very of high collapse, how influx-outflux, not be so you that did BMI. able have you pass actually BMI will to with move wall So do of Inspire a percent that actually highlighting you're with it's that's is talk to a capacity pass patients get XX

more them see airway news come in complete a collapse, those office I going need GLP-Xs And stratifying collapse. wall so have works to is to we -- to have XXX, tongue and patients lower this setting with collapse how patient in base on to collapse. present exam, a we lateral BMI But next is wall if a really the Ideally, only that a think practice. that ideally we're PREDICTOR concentric to an good to lateral can to are the likely a with their really on already see lot groups. the review start the those do take as now ideally The and soft

So track we going need that forward. to

have probably real get to that percent Philips to amount patients actually I Inspire? Your reference the And of is stimulation question did right with was a tried of with not. that to patients significant second this CPAP? answer were to we is the think what hypoglossal bypass nerve CPAP go recall, our the and able

there all I that gate our been insurance have through think small patients I able a inventory, very because a great go percent is few patients wasn't of I CPAP. think the ResMed. think actually inventory there And machine think unable to sure get companies always majority obviously, CPAP. historically, of Philips I they're wasn't from CPAP have because I because our -- there's the of get But that from that recall. tried through am the There a bypassing ask. to

side. So I think the probably it inventory really has no impact on

Abbott Neuromod, diabetes approval I products. of some the has think for

at sleep management the their know patient screens could And how are to friends modeled a at SleepSync, is ResMed comfortable would system with we're tool way look good and SleepSync up set look if manage at model using. good our the if of a the after those, job so, really of Brightree using And we SleepSync, physicians sleep really the did system our we screens they you And and the having that patients. the that's physicians kind after ResMed. be

patients are are manage that are remote physicians, those those the longitudinally, and for. designed And program is the the those ones ones the sleep the that

sleep, that are FDA they have programming. management the remote really doing longitudinal building may you kind we're management. approved has of SleepSync implanted longitudinal the past. But and Now more in ENTs for do the And products certified for and that

move for precedents have do which we to forward So with.

much on Suraj. So very very, thank that, you

time, but over just want the to we're one joining thank note. know last I want make for to call today. you I I all

team's is enthusiasm, their providing wish for growing updates remains all for all employees interest forward I'm of to Inspire on team safe the Inspire very and as consistent the to The to success. in business U.S., focused of dedicated as continued healthy. the in outcomes. their the further Thank much. with commitment healthcare to patient and further continued And and important on I and teams months our to work ahead. always, efforts motivation our look remain and of of As for and well and successful continued thank to you employees we as unmatched your in Asia. hard element patients expanding Europe our grateful Inspire most achieve call, support you the appreciate we in you Please stay the

Operator

call. concludes This today's conference

disconnect. now may You

Inspire Medical Systems (INSP) 1 Aug 232023 Q2 Earnings call transcript