LIVN - Earnings call transcript Q3 2021

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Operator

Good day, ladies and gentlemen and welcome to the LivaNova PLC Third Quarter 2021 Earnings Conference Call. My name is Lydia and I'm your operator today.

As a reminder, this conference call is being recorded. I would now like to introduce your host for today's conference, Mr. Matthew Dodds. of President Vice Senior Corporate Development. LivaNova's ahead, go sir. Please

Matthew Dodds

our Thank for webcast and And the to you, welcome conference discussing quarter XXXX. call of Lydia. third LivaNova's financial results

Executive are Joining today's Little, our Investor Financial Damien Officer; of Lindsey Alex Director McDonald, Officer; me and Shvartsburg, call our Relations. on Senior Chief our Chief

the to this cause results begin, forward-looking Also limited in website. discussions to in statements. non-GAAP include forward-looking available directly our I remind today's press most Reconciliations actual will include which do can our statement. including Before are We which will to any company's like we materially financial update you available not most that that our the found on and but to basis. that can be filings call to would comparable the constant to currency results the differ undertake GAAP on a website. not measures today's is discussions is stated documents with to during SEC, on sales the will certain recent Factors performance, all respect financial release press discussed furnished release measures including be

website posted the presentation that also to an call. tool. communication and as enhanced call the a have should today's presentation materials is points of We other summarizes to our This complementary be used

and that, Events over presentation release the of I in the call turn find press at at now the Presentations to & News, can LivaNova investor.livanova.com. website will You under Investors Section Damien. -- our With

Damien McDonald

increased third will with After Then comments start strategic quarter I'll on up everyone off before closing our my then review initiatives. moving and I'll our XXXX wrap guidance. Q&A. additional our call. And comments, quarter Matt. Thank results, to thank third you joining results on you Alex sales you, by with details provide discussing our portfolio earnings for

operating impact sales margin today's trajectory by include to will headwinds. comparisons by cash free believe pandemic COVID-XX-related our context expansion the we underlying a Heart flow third experienced the our business. results navigating and on generation, also We impacted growth, to excluding will this quarter Valves, We environment are year XXXX. where, while results, adjusted Due for the encouraged sequential certain challenging of the provide of prior helpful commentary more

on there are Additionally, are of earnings comparisons that presentation. XX reflected our Slide

growth growth Epilepsy increased sales ACS. Turning quarter XX% drivers, three regions. third core the to double-digit Epilepsy globally across our and of XXXX versus all with

improved the XXXX in in quarter and market implant the to prior sales clinics driven in growth grew versus benefit hospital to global below quarter levels. Similar Epilepsy access line catch-up which increased with are increased of implants procedures high-single-digits third we quarter continue sales Total year These the were to remained and of from for XXXX. was in XXXX by quarter deferred from prior levels. but line XXXX with a third in prior dynamics, trends, patient total replacements the resulting XX% Epilepsy period. results U.S. versus Additionally, the XXXX willingness year versus the reflect levels. to return

we Additionally, sequentially improvement while variant Delta X% leading sales in due were for October. volumes surge, saw down the during to patient primarily indicators an

world, compared in Europe baseline same and teams. third XX% were to the which supported growth recovery by sales and in go-to-market the by a region in quarters Arabia. strong XX rest and in in continue for by sales of Europe world led U.S. encompasses in business above and Epilepsy prior They of U.K. results. XX% currently Taiwan now be U.S. continues achieved XXXX in and sales growth the account progress that implants, our China, of QX of Italy. is dedicated the to XX% third account from line Saudi of deliver basis. on grew Our Epilepsy to rest XXXX. led XXXX initiative trending versus quarter aggregate, year XX% teams We with and implant the approximately the These up

We grow for XX% to XX% expect to year. full global Epilepsy to continue sales the

in Our as sequential in includes patients visits. physician to caregivers forecast growth return new their the implants U.S. in-person and

of into increase quarter continued in In an the XX%. were has in increase from and distress. and ACS adoption continued of in by XX% replacement addition, Growth the quarter, of but million driven third tailwind XXXX our of we respiratory was an procedure XXXX anticipate growth sales implants the a sequential LifeSPARC related that particularly $XX volumes, to in backlog in created year. continued this

months performance the our anticipate over we in now to of Given in XX% XXXX. the year, nine ACS grow first

Sales DTD. million XXXX third and Turning first of nine for million. $X were the the in to now $X was quarter months

combination full For we now of sales approximately the the of implants the study for million year, anticipate RECOVER DTD CMS-eligible $XX patients. replacement from and

consenting Delta some now related the implanted COVID study, QX early of quarter. into the patients While the impacts these continued is to in the during it by patients of likely delays, in will that -- we unipolar variant we RECOVER XXX to implants remain Due XXXX. encouraged more created delay progress achieve

In skewing the anticipate this cohort. addition, since milestone of are of will currently bipolar unipolar, occur we achievement we ahead

XXXX. the the registry. to transition registry transition continues or key we data independent data Once still and the If endpoint three the have the reminder, to look early these primary trend all after submit will the Heart do met, set. enrolled, milestone may enrolled. at the five trial data the cohorts criteria occur success been submit If toward patients a the is XXXth HFrEF or are including in April. safety, to is patients We in for enrolled the a patient unipolar In a review the reaching criteria, followed all and nine statisticians pivotal XXXX bipolar anticipate months late As study and not the functional take a we to XXXth we advance post-longitudinal Failure, XXX can endpoints, will statisticians data separately for meet of the ANTHEM from FDA. functional independent to another after in patient

the start to the statisticians first independent data XXXX. in the expect analyzing of to continue half We

our OSPREY trial are patients. mid-XXXX. this implant screening XX OSA; remain patient and already activating assume sites submission track all our we We several first still with to FDA in quarter to has and on commenced Moving approval for selected

with sales particular over U.S. the Oxygenator XX% regions, $XXX in strength For in of high-teens third across million increase quarter in were with versus the sales sales machines volumes. improvement the three growth across of the cardiac business, Cardiopulmonary regions, the increased quarter, an driven globally in with by all Heart-lung XXXX. three XX% growth increased all surgery

Additionally, X% XXXX sales were for quarter levels. the Cardiopulmonary above

was Lastly, million. Heart it this third And turn Heart Valves to that, I'll year on sales with divested was Valves June the of Alex. of XXXX for quarter over X $XX and

Alex Shvartsburg

you, Thank Damien.

million, quarter the Adjusted as to increase of X% the were $X.XX XX.X% our deferring adjusted improvements. as rate increase This was margins flat the During recap to operating gross an increase and driven in quarter third the third by Adjusted was SG&A million of the from of of which by of XXXX. income quarter $XX quarter the tax were XXXX. compared quarter increased Adjusted XXXX. was of expense improvement operating third to the into Neuromodulation of the update Adjusted percent by third quarter $XX for XXXX expense quarter were of XX% million XX% in Sales operations with in $XX XXXX. in and margin margin in primarily $XXX percent a down the million Sales was R&D percent a my the Part sales to XXXX. XX% certain to in margin rate X% an in to driven in to portion SG&A from R&D attributable share income line of the continuing XXXX EPS sales quarter the diluted provide excluding in quarter of and Valves. quarter primarily was gross of were of sales XXXX the were quarter operations current Heart primarily results quarter sales to for in operations the third in in in our a in XX.X% the $XX to million of third up of geographic of an quarter comparison compared XXXX. from operating third XX% increase of to X.X% The was expenses of third effective third the third of XXXX, third mix. of XXXX. income quarter the a the net and was prior geographic to million Adjusted operating compared XXXX the was compared as favorable from quarter compared was XXXX. of The third the sales $XXX net comparison $XXX to third third compared in up third margin compared was quarter quarter comparative third quarter tax Cardiovascular $X.XX the the the compared quarter in periods quarter XX%, million, by of increase income the XX.X% compared XXXX. higher mix. results XXXX. continuing an year. XX% quarter. and in brief year. versus call, I'll sales XX% both Adjusted net $XX The from and guidance. continuing was to driven XX.X% product million, was from of $XX last is in XX% quarter third the million of

in million. weighted average the diluted shares the equity outstanding XX.X adjusted Following quarter offering, were

impacted cash $XXX The year-end million XXXX. equity net Our raised we in cash was and term XX, balance million was was at and debt cash million of $XXX end million retirement at change XXXX $XXX million million offering, proceeds net $XX $XXX $XXX quarter of million, debt the from by Net our loan. balance in XXXX. at at where versus year-end the down $XXX September balance

is purposes general and credit we addition, executed available a corporate that remains secured undrawn. In million for revolving $XXX facility

flow which months million $XX of lower capital the during of comparative XXXX. free $XX was spending We was adjusted first for first year three Our XXXX than period million cash and $XX million the third for in nine for invested was quarter the XXXX. the quarters $XX million of the

XXXX Now, our guidance. turning revised to

quarters three previously performance our As first of based full XXXX, the during our Damien announced increasing are on year we guidance. mentioned,

forecasting between XX% the when is of This respectively. X% and We and and XXXX between growth prior guidance our from excluding business. sales up Valves XX% X% and XX% XX%, XX%, XX% are to Heart now to

growth sales a X% assumes exchange guidance year tailwind full rates. Our from

and for million $X to million. $X.XX of our average expected $X.XX. the million million of Adjusted XX.X fourth the million prior projecting We from of year. up cash the per over continuing to is prior free flow to full outstanding are guidance our And $XX between back to to be $X.XX, shares $XX diluted up XX.X diluted guidance range of in $XX from share $XX operations assume for Damien. be We from the now weighted that, earnings operations from our call to with I'll adjusted turn to quarter XXXX adjusted million,

Damien McDonald

Alex. Thanks,

building are across increased we've good this momentum We into portfolio our consideration, diverse and, taking a guidance ranges.

with changing that, to remain from Investor sharing live on December on to at our with will on Day I questions. be the line a and dynamics forward upcoming the we the open our focused which While performance for event. you updates pandemic, with let's business we pipeline additional delivering resulting And commitments. virtual Lydia, delivering X market look improved continue

Operator

Rick Rick, you, open. of your first Please Our line go Thank [Operator from today Wise question is comes Damien. ahead. Instructions] Stifel.

Rick Wise

Hi. Hi, so everybody. Good it's Obviously, unpack like here, to Damien. do there's where start. we much morning,

solid are do we last not has so what's I'm quarter in little think many this into hearing We're -- the you people. ahead, continued is And of helped Neuromod. said. quarter and COVID you with the and quarter, I just Maybe, it just have second quarter Damien. much with that from did just on more, you I move what, but any, in Clearly, backlog you this that you momentum unpack think impact know guessing and fourth how all quarter quarter quarter confidence year as next Where Let's execution a your so just front? that, the the start fourth if related another to out. indicate, as starting could on you

Damien McDonald

joining Well, me like a to first for -- you Thanks us. Rick. of lot Yes, good all, say, let unpack. morning,

is still Delta significantly unpick a Epilepsy U.S., Let's start the clearly Japan. indicators with, from particularly October. the an To bit, U.S. impact, in the the having leading business Australia, U.S. improved

right, you're from I is, thing getting end-of-service. think for a tailwind important us, we're the

performance strongest the and digits high-single August grew was implants and U.S. total So September.

to So it and that's few lot quarter. NPIs last catch-up. do than to Similar deferred end-of-service the the procedure with a the faster the improved through quarters, recovered

XX% end-of-service declined -- year-on-year. grew over So mid-single-digits. grew NPIs

In So over end-of-service to it the implant in was for XXXX, that XX% opportunity we expect business us NPIs and the helped. an really end-of-service grow mid-single-digits. grow to

all of Arabia, force in significant really that. interesting reimbursement October. I'd we as investments so In improved in in the with really nevertheless, saw say into back a helped know international which really because the was sales of rest Taiwan, and were End-of-service conditions changes team I through, executed some Canada, pleased U.S. read quarter Taiwan how significant growth there really part definitely pleased increase we're So of in about the well. the a business, China, is Saudi half the and recent smaller world our

Matthew Dodds

Yes, Rick. Matt. It's

we're said highlighted, as were at Remember at last So we Damien on X,XXX. quarter we the XXX. backlog,

think but just We in enrollment the or into that maybe we're might we well. into capture XXXX ate will capture going little So a number, so as to backlog did this the roll fourth XXX given not we bit that quarter. XXX;

Rick Wise

Got you.

RECOVER to big trial. think topic, -- Turning the I second the

first about up Was fair be the worse feel it the monthly -- confidence pace and into not the but going just you how a on it delaying be Are delay. But general get where will starting that modest side? enrollment first seems the delay, pick thinking like that trends confidence I and in be to highlight September reaccelerate flow it you can the weakest? you're -- quarter through us to unipolar us did it's care, third not gives quarter, that You help see gives and generously, that in to that you how need don't the and it's did than confident quarter? and to you to the sufficient

Damien McDonald

set there. good of Yes, questions a it's

slowdown. couple to really it of largely, shortages availability And was impact sites. clinical So this the rate we an our of saw just some related months patients staff last and at the implant Delta, clinical

consents increased at look nearly consents, you actually quarter-on-quarter. If sequentially XX%

So step really was actually that implants. pull-through positive. just technical It -- into the was really

-- as are and said early positive XXXX think one we late this unipolar, pipeline, so really commit And on delay is, XXXX, will skewing delay CMS' the a earlier and that's so that just this transition patients to review and why We're registry. timing; hasn't doesn't a the modest sicker changed. and We to bit QX come described, early affect depending through into so we're through it still the to I harder who bipolar our modest unipolar. really little unipolar about move the that's extended but we

Matthew Dodds

Yes, Rick.

it's we're that August, half extrapolate at confident for you October months, in September, look still very through our and next the If average you that's why implants 'XX. QX the three of first

Rick Wise

great. that's Great,

degree brilliant more right, To -- that this guidance, percent what has last excellent patients? had not is year, would perspective. a implies quarter last quick the COVID? there. quarter LifeSPARC a your Just while obviously I'll Just may more sneak give little in. doing math us it maybe Why I COVID? us COVID-related Great slow? one I'm to if What and the slowdown. And much. color just Thanks be, fourth so give see one been for a quarter. Is some the

Matthew Dodds

half. other and Damien, Thanks, I'll take half Rick. then,

have in you in That COVID, second the little one is estimate But for probably volumes, about So to in into COVID get a the also think procedure It's third ACS terms bit quarter, surprise. of Delta not that's it up should the of Rick. business. and does the the third and big from impact critical for harder the business. we a was the a negative when it thing just hospital quarter, XX% on quarter, kind worse about is got

minuses to So percentage saw come but a in there we little pluses was and October, actually XX%. bit. are COVID it the down And

Damien McDonald

just is ramping. the rate, because of And QX in QX terms the were than Yes. we growth difficult just comp comp more

in the that's but change implied growth that apart from really So revenue. sequential nothing rate improvement

Rick Wise

Great. Thanks, again.

Damien McDonald

Thanks, Rick.

Operator

Mike, is today next Matson line The Mike you. Needham. open. Thank from of your comes question

Mike Matson

for Cardiopulmonary morning. taking good questions. with Yes, Thanks I I'll the business. guess start my

pretty So maybe I what the But the you oxygenators, easy on can probably you a growth fairly heart-lung you good heart-lung with saw timing then, new the you strong machines, before? there. give comp. just understand Is said of there, can still just you saw a growth. comment consistent had both us update an And the that machine?

Alex Shvartsburg

It's Alex. Mike. Hi,

business last is saw both consumables as HLM. a our strong front, just teams, performance by well on of function sort COVID execution of of Cardiopulmonary a So We sales as doldrums the and the recovery year. really the good from

feel but of think again pretty good we good quarter. were I was we benefiting about It a year. tailwinds So the strong last the from performance

Damien McDonald

the terms the in rollout to the first of half year in Europe, the of rollout. of anticipating And in second We're HLM still in new next U.S. then start HLM, the

Mike Matson

got ask then, the I one OSA on trial. it. guess I'll Okay, And

just trial maybe of design again So submission bit that terms the the about and in little enrollment a can to FDA? timing talk of you the expected and

Matthew Dodds

Sure, Mike. It's Matt.

So That's to we months XXX approval X-to-X targeting if we timeline. six-month assume we're XX up our follow-up to XXXX to randomization, get enroll. FDA how patients, about

Mike Matson

it. got Okay, Thanks.

Damien McDonald

Mike. Thanks,

Operator

next question Adam your Adam, Maeder is Sandler. of from today The Piper open. line comes you. Thank

Adam Maeder

here Hey, just the guess taking and thanks questions. the first Two guys. of me. Congrats the construction on guidance. quarter is the one nice on for for I the EPS

like, little that if guidance. in we in looks down assuming step even a with QX the right strength the a bit I'm math the adjusted of QX, in saw and EPS doing outperformance the it you're raised Given here,

there QX? think out through heading are one-timers or just maybe is spend in that? to next that OpEx secondly, then us So into year. And conservatism any why help Is call

growth but Heart Neuromod, ANTHEM away ACS like expenses wiping key drivers then pivotal in obviously investing and trial. Valves-related the You're

So just I Thanks. on follow-up. then touch that. maybe one And had

Alex Shvartsburg

It's Alex. Hi, Adam.

impact kind patients' So looking willingness shortages at also to our undergo level. variant. the hospital non-acute force is sales We're of to It -- and staffing we're still indicating at continues hospitals the Delta procedures.

we're being I kind for also ticket especially So cautious risk, some -- think items supply our chain seeing our We're larger of also of in regard. in that cautious we're HLM. terms being in

of on So kind the that's revenues. headline

a I freight would And so going say, up. cost from costs perspective, are

our most phasing you're expenses. that of terms of and then from hearing think of our I in peers the

challenges some expenses of So as the QX quarter. the of saw we of the deferred in into revenue we current kind some trends, around the in quarter

So of back in you bit will of our pretty feeling good EPS around see a little to a here. about Still kind achieve target our bounce OpEx. a our guide ability and QX

Adam Maeder

color. helpful then other guess for really Appreciate Alex. that's I Okay, that, the And me. one just one

get touched initial Day there sneak to in Will for guidance? just a I remarks, to hoping should and we on we a so for of get the early it be was initiatives 'XX to Thanks You on December looking and we here Investor couple an in much. primarily what increased pipeline update Is terms LRP? think focused on, plans? get pipeline of Will peek in commercialization P&L prepared what weeks. the Just the visibility expect. and

Matthew Dodds

It's Sure, Adam. Matt.

for over we've be run the separate not through will and give going going yet pretty we're comprehensive focus going to XX to the this past 'XX, save are walk on to and going be plan. February SPI's. They businesses long-range all educational build months. sessions. off We're a to the going but that we're all series to So major We're the

Adam Maeder

Sounds great, Matt.

it. Looking to Thanks. forward

Damien McDonald

Cheers, Adam. Thanks.

Operator

Anthony today Our Petrone is line your next comes Jefferies. of Anthony, open. from question

with question. proceed may You your

Anthony Petrone

I everyone good then on is depression. here. print morning, strong Thank A doing on you Hope everyone. one well. a and have on couple and VNS Congratulations

certainly year-to-date traction. On strong the side, VNS

to we're here. us XQ and relative de at, We're wondering the we You spoke how contributing do looked novo to how of trending levels. -- sort give on trended down could the update backlog I'm about just have if still an implants, getting specifically still it's those math some a they're XXXX you bit perhaps here versus levels. but XXXX attempting in

a how are novo on And placements depression. I follow-up then in have So just wondering de trending. VNS

Matthew Dodds

Anthony. Matt. Sure, It's

Alex companies, the again, lot as, to NPI, down trending it's third to XXXX, of you're to is on quarter So that range. And hearing in did it sequentially. XX% from decline versus similar XXXX of defined what a non-acute and back about down it's still mid-single-digits normal the it's procedures. Neuromod the Versus for, not below, still XX% what

are the to lot today. than attention a no getting But in to de replacements So more procedures reluctance still for of related novo. and hospitals overall, this the patient surprise is the come

expect XXXX. fourth that we into to pipeline so certainly back is and said, is good one the But area the looks that NPI far we quarter, So XXXX. the to accelerate still not to the

Anthony Petrone

that's traction on novo are pulling well just just of is here Comprehensive 'XX. there the quickly, depression those drop-out delay. the Meaning, on and and of as again, so CECs there you how real anything Thanks, in that Is in some follow-up backlog push-out that and has just context, that and seeing, XQ just push-out to again. de Epilepsy drop-out then And of Are a to Centers that Quick at led placements? a on the way causing performing. locations, through patient as better risk?

Damien McDonald

the go-to-market. on first, just Yes, the

still in of XX% the flat baseline. that versus So group outperforming sort versus in versus sales the 'XX are is group up XXXX to the baseline. XX% XQ XQ CEC 'XX

in I that looking segment. on So XX is a to is XXXX. I traction those good in continuing show think focus again to that to And expand for this continuing And that group market sign we're think parts.

shortages were largely I implant I through as sites. some And again and come nearly DTD, think our having is cycle at into pull sequentially by on Just that it clinical just the the related patient some XX%. taking said, staff of that willingness consents to up to It's clinics into time.

Matthew Dodds

is level drop-out there And of expected. some Yes.

of agreement, part look the at public the you CMS If that is calculation.

not that's for. something out been to is far so watch understanding Our

Anthony Petrone

All right. again. Thanks,

Operator

line comes from Our your question of Polark Michael, next open. Baird. Michael is

Michael Polark

Hey, good morning.

milestone not XQ I a like when Just hear It comment reach a an than clearly but handful hazard in XXX later 'XX for sounds you expect updated did me would on target. to arm? arm, here. that you Bipolar

I if missed Sorry, it.

Damien McDonald

said first know don't whether but somewhere it's I No, in No. I half. it the

Michael Polark

Okay.

Damien McDonald

of the will then bipolar unipolar, group. we lot the into As attention the hit a kick over

they're harder of trajectory I that's the pulling said, given And through. through just there. unipolar, Delta variant this of the that focused It's larger patients. like really surge, to As on the sicker we're I patient just much move changed again it the some DTD and said, as And XX% with pool. more

So, getting priority. one is registry that the into our cycle

Michael Polark

And the bipolar or is is maintenance tying together 'XX, slight registry target delay it unipolar those the important you together. the to enrollment updates fair me late -- how of registry timelines implants have flip just a the -- 'XX, how -- but flip you early had achieving registry to have and in timing -- just for timing question work on the the -- range better to the the I but of here that -- us two maintained and year embedded next or target pushed late early considered I is, help your XXX,XXX say that understand of you importance of next milestones? these year that help

Matthew Dodds

is cushion Yes. the short in made available answer. We probably there

Michael Polark

Yes.

be discussed last one. was think call this The -- to to a thought -- program successful seems the nice certainly don't that catalyst but for or I shelf for and this this reimbursement here HFrEF, to Okay. has this been clinically. initially be on call not MCIT extent or it's the the on

update on reimbursements you you share if in program too clinical to to the envision be -- how would and to not the I don't for MCIT the to seems of the what still willing be VNS us front, is far a there heart that few ahead want dead? given and failure, deferred, path understanding higher-level get comments So

Damien McDonald

whole at we model -- when look came I appears whole started -- that the we program. disappearing. to the or factored program disappointed candidly, disappeared we I that be program. along our The that, to after MCIT into had committed Yes. personally I'm never

having to study there'll MACs building So A pathway of the important big generate the milestones we was also starting in not up we believe primary the were then also only a part big the of and to data -- endpoints. functional it data. A continue was with program study. our embedded and make to going part sure breaking that be the but this

with in that could have conversation And so the pieces. we this MACs

but headwind into said, as a that it's So I initial our had reflected we model. not

Michael Polark

you Thank so much.

Damien McDonald

Cheers, Mike.

Operator

open. comes Hi, from is open. Scott Scott, now your Our Berenberg. Scott, is question of line Bardo line next your

Scott Bardo

was Yes, I on the guys, kind question, thanks view of questions. margin please. this guys, EBIT for -- EBIT mute. Alex, you if for my give year Hi the apologies, Sorry, margin some taking LivaNova. first adjusted wonder could I on

your implies XX% I guidance something I'm a right, think if like margin.

-- operating to next be you how if to of please. wonder I I that the cost they likely is be of business, trend you're year? this So give that would which operating this of costs likely Just bit some could are stable a we've below helpful. highlighting had or out lower into this Valves now up, confirm a you level? And linked to the actually OpEx that, a the think flavor there bit a sense obviously, Heart us year's quarter into reversion Can fold. Are

Alex Shvartsburg

please. question, Second

Scott Bardo

ahead, and come a Thank with go Alex well, back follow-up. you. Hey, I'll

Alex Shvartsburg

Sure.

forecasting XX% So our is that's That goal. you're margin, at -- we're right, it the XX%. to

inflated. In on terms of some quarter the quarter. obviously -- margin saw rate the deferring back pulled investments. expenses some some our this in quarter, current We I earlier of so sales and softness the somewhat about we We into talked

of year. As XXXX the start ahead you invest know, this of half in typically to second we

and defer into QX. at So decided expenses to discretionary we them some looked

Damien McDonald

few I in time. terms a of in we weeks' guidance, will view February that we'll the And Investor but do in mean, Day give at a long-range

Scott Bardo

give Neuromod? you And sense you patients? giving Are patient XXXX that the could Am of best VNS. quantify longer-term thanks right I growth metric some to is some for on helpful. on there, just, the patient just maybe could new guys. wonder that If or really indicator Okay, of saying on Thanks sense adds that are And then I on that X%. would where give in new XXXX. the growing we leading second down if please, question be still versus we adds around new disclosure

Damien McDonald

Yes.

versus So we are down XXXX. still

cut sort think have in long million leads predicting model, there's improvement that I it opening driving shift believe focused that's view obviously on. to the that been the and we was But business And right, patients one of The is long-term in as growth where the X.X is improvement long, started that's U.S. trying ramps XXX,XXX focused the you're we're the heavily lag DRE is to a this those term on markets to because and seen up. alone, related teams in DRE novo. business terms Matt NPIs to that, de of so indicate we're we've the sequential QX. maniacally improving, sequentially that are the how the because replacements. that because on important you of patients to that the -- depending It's

late is life. age are average that to in times Given we XXs, patients implanting their in four three

being And very aspect a lifetime focused on value focused a of on patient. so NPIs, the of key being pediatrics is

them to life is know that there significant a We by impacting quality earlier too. of implanting their benefit also and

significant you development reversal patient been it's get So in from point a of cognitive hospitalized, believe And this their number a of complications. the hospitalizations. terms there's every and time view, of we

So our focus. primary that is

Scott Bardo

Very and thanks. clear

for I of if means that new for then question five or new so. years your think that generation matter perhaps platform reaccelerating is four I guess When please. new wrong, Just you've then does platform, last understanding patient canned is, the I a correct now? plan Neuromod I'm platforms it's about what And the or Iris. me And may, won't that then, the Neuromod? is we additions? next on likely here development in that terms for have Neuromod of follow-up Damien. And my if But

Damien McDonald

Yes.

depth a more will three time. in on be about that Investor between Day the So weeks' years in not few It five. iterations,

about had started where focus Iris, early Our connectivity more a we at were much looking we development. been how Significantly, app took the back were we original really platform. to and There step security patient and has sure making the when we aspects a with looking think what at talking we on Bluetooth. of about stable were

shifted what this said, can but patients with a the engage our few We'll this actually weeks. we talk that's weeks more here in a about But as we're doing with I'm and focus and pleased that that, doing I ultimately. were we we clinicians while to work more, and patient So in app. few how think we'll do about talk we I can

Scott Bardo

Thanks, guys.

Damien McDonald

Cheers, Scott.

Operator

Thank open. you. today question comes line of And our final is Matt, Matt from UBS. Taylor your

Matt Taylor

Thanks morning. taking the just good think. I for had two, questions. I Hi,

I to the was follow failure. shorter-term thought the have on heart if could one endpoint think failure know to I with, actually follow-up get endpoint you the just versus functional I etc. in two-year heart days pathway to a XX reimbursement guess, wanted you hospitalizations, with up

Matthew Dodds

Yes.

CPT for [indiscernible]. expectation. -- is a they're already other just And getting VNS. that's a if It's out Matt, and already competitors, the easy of the couple they as So reversed. it's code look There not that's you at as are

Damien McDonald

is Yes. you with do the The primary answer But functional it the can yes. versus end?

Matthew Dodds

Yes.

Matt Taylor

with saw impacted you has on that? really that hospitalizations bandwidth. the Cardio you with year how endpoint impact think would stuff And have we could the an the and like deal Okay. COVID Do

Matthew Dodds

an trial, mentioned. it's Damien embedded design, trial as the So

FDA. have one quality lot primary if walk will then patients, we're then six-minute we life, miss trend the to on look, hospitalization we and a have there, -- the have will independent in to of just ejection VNS. those, If or hit not to enrolling assessment all mortality, first we of we And look five the endpoint five data hit external different the trends. of ventricular hit the we The left five quite a do data If the hit it, safety, can we It's fraction. XXX statisticians another we The don't then It's us to endpoints. going. to on we do tell just just a again. get of of keep full can submit we and those of

in So up kind -- a a of going have We're patients. we do trial. runway up this we to add long X,XXX

-- during up coming hopefully in close. don't period. in fact have not a but enroll a lot completely a If number again, to endpoint So more boxed had which that some sort blinded COVID if we're of mortality we're non-COVID on did, primary that's know, of we impact hospitalization it patients and on still we set

Matt Taylor

Got it.

that color, I Matt. Thanks guys. for Okay, great. really appreciate it. all Thanks,

Damien McDonald

Matt. Cheers,

Matthew Dodds

Sure, Matt.

Operator

so McDonald the hand Damien in queue, remarks. I'll further We have to no questions back closing for

Damien McDonald

today's of thank speaking in Thank On team, look LivaNova call. behalf to [ph]. our interest entire again you for support forward appreciate Thanks, joining we everyone Investor the XX Lydia. we and And, your at you. look, you and to on Day December

Operator

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

LivaNova (LIVN) 6 Nov 212021 Q3 Earnings call transcript