TMDX - Earnings call transcript Q4 2019

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Operator

Good day, ladies and gentlemen, and welcome to the TransMedics Fourth Quarter and Full-Year 2019 Earnings Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will follow at that time.

As a reminder, this conference call is being recorded.

I would now like to turn the conference over to your host, Mr. Group. Gilmartin from Johnston Brian

Brian Johnston

website. Thank you. quarter copy results the the released the today, year ended TransMedics company’s on and available A release financial December press for is Earlier XX, of XXXX.

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

based All forward-looking for our to XXXX, revenue, organization, and our examination for material current products expenses operating statements, and these reimbursement, events or could are gross and operating regulatory that our anticipated those margins approvals forward-looking involve uncertainties growth upon trends, and in and statements statements. assumptions. risks expectations, implied or our various materially from guidance expectations of the our future for potential by includes differ opportunity without results These including, commercial actual financial in limitation, estimates which cause

not these reliance undue Accordingly, on should you place statements.

Exchange and website ended Quarterly our SEC’s in the Report XX-Q and uncertainties and on with the Risk associated XXXX, list XX, September quarter Commission risks that to which to for offering www.sec.gov. we prospectus our description a Form our refer filed the Securities are of relating Factors had business, at please For final the with of on and the section initial public available

time or the intention and other or events forward-looking our by from SEC. available TransMedics projections because except new and or whether financial filings time required otherwise. or any made law, as obligation, Reports of make any be by to revise Quarterly will information statements Additional future disclaims that information, we with update to Annual

X, broadcast the call contains accurate only of as March is conference today, This and XXXX. live time-sensitive information

call the President over Officer. turn Chief Executive now I’ll that, and Hassanein, to with And Waleed

Waleed Hassanein

and full-year and Thank Good everyone, Brian. call. you, earnings afternoon, XXXX TransMedics quarter fourth welcome to

Joining Chief is our me Stephen Gordon, today Officer. Financial

momentum for for we foundation year meaningful products which all a our multi-region up year, achieve transplant. for of of We commercial lung, OCS million made multi-organ, to was the $XX.X the liver was XX% three and building strength progress TransMedics revenue XXXX a heart, build across in growth versus solid leveraged for and of XXXX. our presence which

few revenue OCS then representing centers attention key I products with We Lung a in our the Lung and year over in the our highlights three last would was Lung turn product. $X QX like ended with year. commercial XX Starting OCS XXXX. to OCS growth million, share across U.S. to XX%

to drive opening while deeper across we’re adoption new is plan gradually these Our accounts. up centers,

TransMedics fundamental call Lung on minimize technology our challenges during stated working initiative of help accelerate adoption on new that and utilization. QX the logistical a I Finally, to been has the OCS center-specific

delighted Organizations, centers. with to the OCS and we Organ in Procurement first collaborations several report model service OPO, few a initiated of major or I’m QX, that U.S. transplant

of use relationship System. complement the technology to is collaboration and organ logistical across This for adopting transplant maximize utilization OCS and lung by to existing is Lung center-specific U.S. transplant OCS initiative increase this challenges of our the augment to the commercial centers aim The donor overcome with

product. OCS our Heart to on Next,

Panel TransMedics We’re data be the Heart has our to pleased on April FDA that to Meeting XX. Advisory of the OCS formally communicated

to of the the We’re a panel positive looking active support maintaining hopefully agency to Heart with dialogue forward PMA an approval. OCS the endorsement and we’re achieving open

heart adult hearts of we that These System. donors This DCD transplant optimized the hearts after resuscitated, was heart Heart exclusively the and from use of on hearts. enabled assessed OCS System. heart to clinical DCD new our our category with Clinically, an donor using our Heart procedure – OCS transplant were or circulatory entirely continue drive program momentum by is donor U.S. from on death, procedures first-ever

transplant. Importantly, curative this new heart the procedure will significantly help end-stage to patients heart of therapy failure access

case was centers heart The transplants. done heart and of about December. XX We seven DCD with we’re U.S. the ended XX heart in XXXX early the Heart with OCS transplant transplants DCD year the today, at in – DCD ended We U.S., heart first trial XXXX in

OCS Finally, our product. Liver

We enrollment look As data in the our we Transplant American a call, we full than earlier quarter Trial in our in PROTECT readout May forward trial. of completed discussed at third XXX-patient to Congress this expected.

Liver in submit PMA the our XXXX. We for indication to are QX on OCS track

approval to while Protocol the System, the CAP also development under Liver for FDA received is OCS PROTECT enable momentum continued and clinical OCS Liver review. PMA Access the We of and or Continued utilization

the further System. approved classification IDE DCD as device. This Liver breakthrough the Finally, liver that FDA DCD aiming to expand first-of-its-kind OCS trial a is using a utilization for is transplants OCS our trial and donor

Liver the and PMA by We the to drive clinical DCD in expect OCS with the the review we our while ended of XXXX programs year OCS U.S. of System, XX the centers CAP under trial Liver combination the Overall, momentum FDA. is significant Liver

and macro very we organ transplantation better from Human drive are utilization organs Services for mandates level, initiatives encouraged a donor CMS and Department by federal the On of and to transplantation. major two and of Health promote

outcomes issued of was centers mandate CMS transplant ruling of donor more remove designed to a a organs in as more for aggressive U.S. to CMS programs mandates, transplant post-transplant clinical This to be As for encourage these pursuing a transplantation. requirement in the part certification final

revamp transplantation new U.S. Services metrics will metric new in assessment CMS at donor heart also the utilization addition, a ruling Health rate focus assessment of primarily on and In for These OPOs. and Department performance Human to the OPO these of proposed

are of OCS has in We believe and reported supportive lung heart donor of mandates demonstrated strategy, organ rate these that new that given the the TransMedics’ confirmatory transplant. highest and utilization

rules. utilization Organ the maximize System utilize organ like over expect time, technologies to new OPOs and need Care that donor will We these meet transplant centers to and

to forward XXXX. Looking

we expect expand well to continue major ability These to utilization will OCS initiatives, challenges. believe as business. at our through enhance transplant which drive continue We logistical have milestones, commercial level, OPO of to as center growth to minimizing Lung, service while TransMedics’ are: For several we

Heart, to of remain OCS agency’s OCS panel the April the in in we our late QX approval and confident be We our indication date panel Heart of early the XXXX. the FDA XX, given in address expect For question. or and data ability to QX

Clinical indication expect Heart use expansion future key System transplants. We be drive Heart will Heart program clinical dataset incremental This the include XXXX. for DCD the confidence our the OCS in of dataset momentum to in continued DCD to of the throughout

plan PMA Liver parallel FDA the to QX we Liver, to submit trial Trial OCS results. to in full OCS our of PROTECT For the readout application in XXXX

Liver the continued base and continue to new initiated momentum, protocol breakthrough access already Liver expand break under PMA have OCS the review. – while and DCD clinical program drive We clinical evidence OCS is our to

model, organ For our and expand organizations centers. successful, further OCS procurement across in our model coverage will the we leverage service U.S. if key our geographical service OCS to transplant

Importantly, OCS we include will is hand. expand approval it Heart in FDA to once

and said, new international pandemic sales, especially impact initiatives our to in to continuing high-volume the That we about our Finally, Italy coronavirus negative Middle being in international ability are add of Asia, near-term to we by look potential East. and reimbursement concerned the centers grow the business our and grow advanced continuing geographies. forward to

a represents we’re the revenue million net above million $XX This growth in above With range foundation, to with XXXX XX% and of – providing XX% full-year $XX guidance sales. between year-over-year.

to growth. overall revenue We sequential see expect

year between throughout organ the specific lumpy may other. one be revenue the However, the to quarter

highlight to – chain of turning specifically, sales. and Stephen, the our our we very the Before monitoring the I our supply on call international the to opportunity carefully to pandemic our that business, take are coronavirus – want impact on

the We’re of Systems. raw of actively supplies the necessary precautions taking needed continue to material ensure OCS to production

supply Near-term, shape are we quarters. standpoint the that good three next a we in for chain feel confident from

will With that, call over will some turn closing to I and I comments. our Stephen Stephen – Gordon, returning with CFO, be the

Stephen Gordon

geography Waleed. ahead I’ll and provide detailed you, and of description results, financial by organ. by including go a an now of very overview Thank revenue the

I well involved when and net which results, paid we to gross that deduct our in will both collection is data trial we clinical trials. the certain the I amount in sharing past, as clinical centers As revenue, which costs revenue, invoice as customers, done have revenue provide from

QX In XXXX, this revenue. clinical impacted only U.S. heart adjustment

of of fourth gross and XXXX. our over fourth was the increase a over for the was XXXX, the quarter XX% million, increase of quarter revenue quarter So $X.X revenue million, XX% QX $X.X XXXX fourth net

little So let a break this further. down me

For the OCS from the was million, $X.X Lung from fourth million was revenue the $X.X $X.X U.S. was OCS million Heart. and gross quarter,

completed any we enrollment. U.S. last call, we the not on Liver not Trial the had mentioned revenue we did Liver since have OCS expect As that did

So $X.X same net OCS revenue, the is million and basis, then million. as on $X.X gross Lung a OCS net Heart the revenue the which revenue was is

U.S., also the and gross of are Outside equivalent. net

So our $X.X $X.X outside $X.X QX made Lung of from net the U.S. and revenue up million million, from million of Heart. was

running, Lung earlier, in programs service CAP initiative early of implementation two and EXPAND the the adoption was OCS new currently drivers and clinical revenue Key mentioned our Heart our Heart OPO the Waleed growth and of the OCS QX along that DCD trials. with

from of XXXX margin fourth of to XXXX XXXX. XX% third the XX% and and quarter the show in to XX%, was of compared quarter the up Gross quarter also continue fourth for progress it’s in

and quarter, in grew $X.X was of – $XX.X XX%, operating that quarter million XXXX. $X.X was fourth loss compared expenses in million $X.X the fourth to our by of fourth XXXX, the fourth the of in quarter operating compared to the in quarter XXXX. Operating Total million million

quarter million Our to million, fourth in XXXX. fourth net quarter compared loss the for the $X.X $X.X was of

a equivalents outstanding millions which $XX.X the third million. balance reduction XXXX. of at $X.X of end of the cash for and quarter were equates was Weighted to as shares average December common the $XX.X XX, and cash million XXXX, quarter the of securities from And

do the year detail me let fiscal full a of describe little of XXXX. – Now,

revenue XX% $XX.X million, full-year increase over gross the For our the full-year, was million, year. the an increase revenue prior a over and $XX.X our was net prior year, XX%

follows: revenue over Lung; by net on gross revenue $X.X $X.X revenue revenue Organ, and million, And $XX.X was Lung, $XX.X basis, million. annual was The $X.X $X gross in million revenue is revenue $X.X million million, as by the U.S. million, detail million for XXX% down net to U.S. grew broke $X.X revenue. U.S. Liver. and as the XXXX And net U.S. net The million fiscal annual in Heart; Liver. a Heart,

million million in XX% to U.S., $XX.X XXXX $X.X of loss was Heart. for and revenue in XXXX for compared $XX loss XX%, million million, in compared $X.X full-year the $X.X compared XXXX, from the the $XX.X XXXX the and annual XXXX, $X.X expenses and compared million the $XX.X million to XXXX XXXX Gross from Operating full-year in million was XX% operating million Outside were to to net for included $XX.X was and million Lung from XXXX. $XX.X growth for total was full-year, margin XXXX. million in

turning XXXX. Now, the to outlook for

As net Waleed revenue and service in to was primarily initiatives. the expect driven of $XX adoption, OPO on mentioned OCS our million. revenue to The million growth by further based Lung our in for on earlier, $XX be expectations we range progress

and addition, Heart in compared we both In of have each trial only in to XXXX. one two enrolling trials Liver,

revenue, We as to lumpiness some experience initiatives. to we in XXXX progress as expect our Waleed quarterly the mentioned, continue

the guidance, for in roughly first-half while XX-XX first-half, second-half in providing quarterly XX% not are the for in we And split be the second-half. expect to to the modeling or year, revenues purposes, XX% we

In addition, to to are the at grow year. operating for XX% XX% about expenses expected

will calendar we quarters. also and the will year our I old mention March fiscal to be This to which will in on fiscal have want and XX Finally, calendar, is XXXX year-end rather to the XX end the tied match to mean, change made than XXXX XX, March a December QX calendar that year our quarter.

will make forward. little modeling going easier this a hope comparisons I So

With that, over back the for I’ll comments. to closing turn call Waleed

Waleed Hassanein

clinical and beyond. forward of and Thanks, TransMedics new standard of Stephen. standard we’re is the transforming encouraged and Overall, path practice donor in in takes transplant. transplantation extracorporeal XXXX by proud of is care results clear Transforming XXXX in assessment extremely progress perfusion, by optimization organs time. for organ the easy and for entirely our an creating our and of it never are care

to early headwinds our growth. clinical to track – drive are confident long-term and record We our evidence in technology, navigate our towards commercial and negatively

all to three forward we expect the clinical which a transplant And XXXX Liver. across OCS of looking in utilization increase our We’re Lung, Heart, technology to strong of markets:

call. Again, joining on the you much thank will so Operator? questions. open we for us line for And this up now,

Operator

have we Robbie first question, JPMorgan. your Marcus For Instructions] from [Operator

line your Marcus, is open. Mr. open. line Your is Robbie

Allen Gong

Hi, off wanted just on sorry for about that. This is guidance. Robbie. start Allen I with to

you’re had it like year, been double looking you XXXX I about base in think, like your previously, and a a talked to, you where revenue has be that. below it coming think, would I was looks little

So Heart, bits in in the what’s walk terms can enrollment? and walk like that? from us through of of And just you in like through trial short bit I expect little of terms maybe Can guess, benefits of you terms of us clinical falling in you terms expectations? pieces guidance what prior a like Lung, of

Stephen Gordon

Yes, this CFO. is the Allen. Hi, Stephen Gordon,

hope heart, the provide well by year. to the in So the adoption, in of lung being about as guidance trials guidance organ, then to the yes, in by have organ. talked far certainly, the two not We trials we approved heart and as drivers second-half as liver, the we’re a going two ultimately, – as

much we’re like give the – said that we as going to year revenue often doubling. point is that’s close organ to each regarding double think can close like to of by we feel XX% I XX% guidance kind and this we’ve So to at we felt

Waleed Hassanein

some addition Yes. Waleed. discussed. this to And Allen, to light more I’d Stephen what in also like shed is

we example, a there issuing to is, we’re in we little for guidance heart led XXXX. us for it of the expected several bit what that Many expected being feel guidance factors the be very the panel – the I earlier. to think, comfortable are

Now we it’s date. April on the not could XX. We know influence

we the consideration. into factor had date we that our Now know so what is, to

for pretty Korea, Kong, us very in other being we that of pandemic. much East down expecting which in Pacific expecting Hong from that region. eliminating we’re completely our We’re resulted coronavirus Asia lot with globally, that impact revenue the revenue XXXX, and Middle were conservative situation XXXX sitting China, the And we we’ve – talking discounted specifically a here South I’m of about and

we net-net, to be have think I realistic. So

feel And put will to have business continue we confident year that in that very we monitor this a be stand that in We guidance a guidance. influencing and and feel significant by, us of will globally. we are to ahead we dynamics our the XXXX,

Allen Gong

approved, can DCD, the healthy Got you, when we it OCS that you do do it still approval, translation ahead should modest or get it ahead it. of comes how to the even when like, about sales, the we you some for Heart about then launch? think And get trajectory should that to And of Thank guys. being more pretty think adoption that? think

Waleed Hassanein

Thanks, Allen.

say, the heart, For to not linked it’s the we expect heart adoption to that DCD. out it’s be not –

go expect We cycle adoption We commercial. this know cycle a factors some transitioning in heart that inertia will be to to has it. clinical through from

the some the we that we’ve ton lung a the put heart. key the from And the lessons assumed that we we’ve factors hope applying a and we key from that. early of learned dealing situation lot sense adoption factors We and by with learned a XXXX addressed kind of that ramp of together makes for

the DCD approved but So be link we categorically the The approval. is to to the a than heart don’t the different. smoother lung, expect bit little we indication

was DCD approved, DCD As at as a the DCD don’t heart catalyst trajectory, the think, the to concerned, far is at is as but I growth. necessarily once for we main the hard look that

the heart grow We once see expect adoption to FDA is approved. to

centers trial that like. to the include to go for post-market will registry the and through commercial expect the steps transforming we similar However, centers

the really and model were heart established that lung the However, we ready address model OCS will big that we’ve we headwind that specific centers the post-market breadth for hope will that lung, that, We the the the of the with with the in setting. of help saw the for area. – portion service address service infrastructure the that broad logistics not capabilities hope

So to we go next question.

Operator

For have Lewis from question, David your Stanley. Morgan we next

Your line is open.

David Lewis

Good afternoon.

wasn’t around me. in Stephen, Just not your of know your practice. per a was guidance given But questions coronavirus, going for organ contributor commentary per XXXX. to just I few Asia-Pac a I kind significant we’re the corporate aware get

in XX% it added ex-U.S. relates and We So the split XXXX. help coronavirus is Should can XX% guidance be ex-U.S. between U.S. to be super all at with assuming closer the U.S. we modestly? of revenue, business follow-ups. us us flattish as any about And you XXXX. in ex-U.S. give up ex-U.S. then And of commentary would help between to quick in your light trends can a of you helpful? couple and

Stephen Gordon

in Yes, Sure. ex-U.S. to XXXX. expect between I would of our and revenue XX% about be XX%

modestly. we’ll So grow grow, we’ll certainly, but

David Lewis

disconnect conservatism versus our in majority Europe? Okay, of that believe just more and of prior understand. coronavirus is contribution model Asia-Pac kind around The you

Stephen Gordon

couple I it’s Well, think things. a of

Fist that maybe have numbers. as of that’s – probably our to will that just They at And I’d it. franchise I is if the a in probably U.S., growth Lung growth which numbers maybe rate. Liver, we off, it’s think that primary say, some heart, the outside would look those digits rate, and impacting are high the high disconnect, and is the growth grow see I small potentially single but and you double-digit there small. – we expect are

the think that’s is. where I disconnect So probably

David Lewis

Okay, very conversations panel, Heart you sort agency specific. any then, of into the just have data with very question had helpful, Waleed, And the panel, one? the around heading on

out just on XXXX? had the And of the more one contribution Did in or some is very from of you just what and conservative assume XXXX, Lung. question view a And second-half then in take one pulled you related assumed year? did Heart is, meaningful Heart quick I just

Waleed Hassanein

Sure.

any And the about data. to we or addressing with constant our around address relating part, we – in we to these feel David, we these of additional for And FDA. to questions questions very ability the So any confident we relating stand from the to feel today and data. confident where first having been FDA questions have communication address

second of the the QX. year. contribution we that question question, or we But XXXX. have not some did is contribute contribution, modest actually, specifically, some second heart significant this DCD the We assume growth in around Regarding the program ongoing of part going assume to an

we that, in do from – that are adoption super out that not ensure or like heart roll of anything, in want to because just XXXX is early early the it we the did anything learning and We realistic XXXX. of our aggressive be kind

So response Stephen, that to anything? to you my part. that’s, like I think, would add

Stephen Gordon

from early quarter in certainly that. agree. I from it heart, We contributions No, Yes. at fourth leave we’ll do I the think, have

Waleed Hassanein

end they, for our David, delayed And Right. revenue guidance whatever day, approval month see even the the days in nor XXXX. in a or XXXX, XX reason, a we the as XX if of to don’t that is our meaningful impact by at days, or

David Lewis

Thank pop it Very sequentially, up really did traction, which then Perfect. for you clear. to was lastly, actually that. And see. nice Lung just here

me there’s Just like a there’s deeper give dive if maybe sense, I the on is but – this changes how also OPO-driven center-specific these a commercial a initiatives, dynamic, thinking you’re just wonder dynamic. more the about that’ll in you’re in centers the future? donors? Are on Thank do as add you to XXXX, helpful. reliant going Are there be you many you. How super you on think reliant OPOs? still just

Waleed Hassanein

No, clear. no, that’s Sure.

So, OPO David, the beauty it other. at as the way The one as not initiative, dynamic or We don’t center over the and we OPO look of and look supportive. is at center-specific. it complimentary the

anywhere the couldn’t we the Now we anywhere – U.S., U.S. and allocation System, with along is that do national which before. We from can which in Care the transplant in is a take Organ allocation. lung

Lung early the that helps. headwinds System. the or in that and headcount provided some eliminates and also center-specific It minimizes of OCS resources the logistics of adoption So impact

and we’re second-half to we’re call. the these providing the to materialize lungs to to growth the of that adoption service center I’ve start see both start the expecting So and on QX of the for as streamline the XXXX the said in initiatives, OPO, hoping

centers, will that’s works, liver that’s is about it and – become that XXXX. Lung But of causing throughout adoption just alleviate initiative or it hoping discussions we any to then get platform now that some the logistics concern I additional to for expect started indication And logistics than the the we start once that broader the this commercial if this that and it was center-specific approval and to we referring OPOs headwind the And with we’re dealing other add sort heart, – center-specific with or that logistics at expect from, we alone. OCS System. additional rather of

David Lewis

Thanks Great. Very clear. much. so

Waleed Hassanein

you. Thank

Operator

Last question.

from Jason we Canaccord Mills So Genuity. have

Mills. open, is line Your Mr.

Jason Mills

Thank you, me you question. hear for Can Waleed, taking okay? the

Waleed Hassanein

We’re hearing just fine. Jason. Hi,

Jason Mills

How Hi, gauge like service to Super. it in of on your ultimately might you several market? And de base model are in way percentage Liver, OPO to to where be the gauge Lung? in in it relative questions. I’d follow-up the Can ubiquitous clientele this percentage that’s to the terms help would David’s relative is at terms some you a given you going Can potential center going or us where understand Is you where minimis approval target? there although, there? you’re point, Heart timeframes? that and you and obviously, points

Waleed Hassanein

for question. Jason, the Thanks, Sure.

XX center but the that hoping early located play earlier, XXXX to think XXXX. out eight our OPOs donor operational country, all in enables as in top I in it we’re OPOs down and the maximum it’s see us of vision to the to a in the regions utilization the States, fully tying across United And to that dynamic, front pool are high-performing I across U.S. without of days, specific high-volume, is end the said that is it in of beauty

in United that, assumptions, but I’m define the gives that magnitude. Again, we’re a you in eight We too by an we end early to States. across anywhere to the making the will year, that between of little of any hoping be XX volume – major geographical large cautious order OPOs the high-performing area it’s bit

the and Ultimately, will this we’ll we to up majority And sign off. quarter-over-quarter, those. of already taking somewhere. transplanted hope program lungs be with throughout that these will discussion have see we in We’re vast them

major footprint beauty the with the service, role. lung transplant So will centers offering key broad continue started in about this a And our it’s centers. us actually to play

for this transplant is a the country once find heart transplantation. hopefully, And approved, these makes in that home centers lungs heart

the taking of just We’re of and equation. the organization logistics manpower pressure and out

Jason Mills

follow-ups that. And to Great. two

extent the to call transplanted don’t ultimately for XX that high-volume terms if the take of in there might of the a in much an would how that represent volume OPO in in the OPOs the network benefit So top know United eight those States, of of on the the this we that number ubiquitously, criteria were higher and country. used or be today of are That’s this transplanted one? transplant environment loans question extended was were that lungs lungs more

Question you two guidelines. thing mentioned proposal very important the remarks, or transplant was change is, post-transplant something thought they’re which to we to your I respect or that the be as success to is, prepared their if centers even they One discovered know earlier organs in of talk that transplantation, extended criteria outcomes clinicians recipients patient. not getting of won’t level sort older they’re donor willing the if organ patients age sacrifice and to with we

business the a spend that. minute how that specific could the think it one impact I after long-term? near over – And and proposal had quick your up follow you talk so both on might you And and

Waleed Hassanein

Jason. Sure. Thanks,

that without majority transplants So of number majority to the – with, are one, the volume. XX to majority country this will getting represent question the OPOs in think, organ probably I of for the talking performed that again, and lung vast too engage of transplants we’re top or XX the granular, big, – big a for vast

technology, from The We points I for utilization the only transplants. product, of or that our that’s available we’re that I data speak seen we’ve our higher, is the number increasing speak can point. can only was The this from is talking trial. exciting about impact trial, of witnessed And of tripling – potentially lungs impact substantial. obviously as in

the – next they centers they either. long, know, will do if want today, the reimbursement. the second to part of that We disqualify happen don’t want from short or them that Because to transplant clinical understand do, We long-term outcomes. sacrifice completely to CMS Relating question. their not

data. our speak our I for fact, only In can again, data,

about the U.S. X in the shows best above with survival, in lung data wouldn’t we outcome survival lungs in lung today percentage have have from Our one-year average national transplant or points a hovering been otherwise that the of one-year that transplant transplanted X

this we see So don’t the as compromising outcome.

we donor one donor have only few, fact, livers, that we based and on that very utilization, but in because our if we highest technology, lungs guarantee is the not believe the the safe increase not of were and know data, a rate In donor of the OCS compromised. clinical the of our can hearts also supply outcomes

So I that that the answer OCS to provides think, question.

anywhere on transplant is It’s However, were zone treatment It’s of the the for comfort patients a giving are and “Listen, a – dying say, XX% national at really these the of these license centers transplant the the curative a the to cost-effective. mandates XX% it’s focusing between treatment rate and choice. that on waiting list.”

our marketplace. and position, CMS to encouraging. And our and our HHS to confirmatory strategy that from it’s very coming see So was

on. to point trying that’s So the I was comment

Jason Mills

seems that. Yes. It at important one an like

go you to pointed that don’t So want for thank David it. for lastly then it back out, me, I to color. And

U.S. it since lung, up heart we quarter I in as our but saw frankly, above your think it was lung and was sequentially. expectations the offering first and deliver U.S. growth well, you public nicely that

business the was other below well international the expectations. On hand,

here. I So couple guess, a of questions

wanting to The you Just – trends for sure studying seem – tailwinds. finally, to head level we given U.S. lung our quarterly properly have make to in modeling we’re some into as XXXX.

model? much it of early it think, initial of or different service that do or there the from little then came the that you. could somewhat sequentially. much was international down business one-time, inertia David that trends anomaly, any is a How think I’ll ask post-extended different Was How with sort in way, one you to see talk about it bit caused that? in internationally, you And success you thank be overcoming way. did criteria asked just of a I there approval? us something an And

Waleed Hassanein

Thanks, Jason. Sure.

to first putting the overcome on the has of commercial and work came part So QX clinical is I service would of success initiative the the lung our split. the QX, about that from early and XX-XX just in question, it’s of commercial XX% model. say, XX% team the been headwinds, the early In

we’re we We in tracking what like – centers are our OPOs additional expecting as look mature the we’re trend to to would that looking and and forward that model percentage XXXX. and looking add additional service

second the international that – believe our where business, are to of so Europe. we part see specifically question. here’s I we Relating how in the

the we protect was reimbursement a caused centers be initiatives a think operating will rapidly, maturing come national our decisions national anticipating their unfortunately of kind maturing year, where a lot that I – lot waiting and for positive. hunker budgets, the were of down, to XXXX which of out reimbursement to

a major, in we’ve how – that call seen was that dynamic XXXX. we that So we

we’re to XXXX, this taking the near-term expecting want And Europe that until we’re declared same in here some another the Europe hoping we year. major not of one maturing. dynamic We and the mature to initiatives in overestimate reimbursement in we’re the see the overestimate not For And year. UK. second-half we’re going was one did sometime itself into to

happened that’s – what in XXXX. the that’s So

of, fundamental or the issues, or that causing is We that aware have technology issues issues clinical no we’re year-over-year growth.

form to reached we that great the grow, a and did level a a we team previous some our of beyond national two in think job funding. need years of which maturity I

on as a small. Stephen growth the are because albeit we said, expect scale, some However, smaller numbers

also in in U.S. forward Asia pushing commercial of are was, Pacific. one Liver And those outside of releasing and initiatives start Lung product but Europe We initiatives to the obviously,

hope the out carefully equation numbers sales guidance news And any good that’s that’s of we’re completely happening we’re monitoring XXXX. of all for we the sharing the And in impact the again, that is with very now, are. for But Pacific we in already the taken sharing, changes. we’ve coronavirus. the where out So, we’re why Asia what’s

Jason Mills

it. you, Waleed. Got Thank

Operator

at now time. the Mr. I’m this questions to further showing conference to Hassanein. no turn would I back like Waleed

Waleed Hassanein

Well, thank full-year in you XXXX earnings much. our the time appreciate you to QX so We taking XXXX. call for and be

next for wonderful XXXX. and We’re a looking evening. you very have call forward much, QX our Thank to

Operator

call. and your wonderful Ladies have today’s Thank and you gentlemen, conference a day. this for concludes participation,

You disconnect. may all

TransMedics (TMDX) 2 Mar 202019 Q4 Earnings call transcript