Intersect ENT, Inc.
Q1 2016 Earnings Call Transcript

Published: 6 May 2016

[Operator:]

Good afternoon, and welcome to the Intersect ENT First Quarter Earnings Conference Call. All participants will be in listen-only mode. [Operator Instructions] After today's presentation, there will be an opportunity to ask questions. Please note this event is being recorded. I would now like to turn the conference over to Jeri Hilleman, Chief Financial Officer. Please go ahead.

[Jeri Hilleman:]

Thank you, Danielle. With me today is Lisa Earnhardt, our President and CEO. We appreciate you joining us today to review our first quarter 2016 results and business update. Before we begin, I'd like to remind you that we will make statements during this call that include forward-looking statements within the meaning of Federal Securities laws. Actual results and timing of events could differ materially from those anticipated in such forward-looking statements as a result of these risks and uncertainties, which include without limitation; our outlook for financial performance, sales force growth, clinical studies, approval of new products and indications and procurement of reimbursement codes, which are based upon our current estimates and assumptions, as well as other risks detailed from time-to-time in Intersect ENT's reports filed with the SEC. Intersect ENT disclaims any obligation or undertaking to update or revise any forward-looking statements contained herein. I will now turn the call over to Lisa Earnhardt. Lisa?

[Lisa Earnhardt:]

Thanks Jeri and good afternoon everyone and thank you for joining us. 2016 is off to a solid start with progress on many fronts. We delivered $16.7 million in revenue in Q1, roughly in line with our previous commentary on seasonality. We believe we're on track to deliver our previously stated guidance of $78 million to $80 million in revenue for 2016. We also made excellent progress in Q1 toward our goal of expanding indications as well as our product offerings. We received approval of the frontal indication for PROPEL mini, completed enrolment in the pivotal NOVA clinical trial and our nearing completion of enrollment in our pivotal RESOLVE II study. Let's dive into Q1 in more detail. As a reminder, on our last call we mentioned that Q1 surgical volumes would drop by approximately 10% from the fourth quarter due to the resetting of deductibles and we view that this trend held true for the start of 2016. We did have a temporary decrease in territory managers due to normal turnover, promotions and some territory adjustments. These sales related factors have been addressed and the number of territory managers has risen from 67 at the end of Q1 to 72 at present. We believe we're a critical mass with about 110 number of sales team and we anticipate further strengthening of the team by adding another 10 to 15 by year end. Our continued confidence in 2016 is underpinned by our high level of recurring business, a large addressable market opportunity and four distinct drivers of growth, namely, seasoning of our sales force, the addition of sales consultants to drive depth, the increase in reimbursement for signing procedures and the expansion of our addressable market with a frontal indication. To expand on these factors, we continue to enjoy a high level of recurring business with approximately 86% of our revenue coming from orders from our established accounts. We added over 550 new accounts in 2015 and another 100 in Q1 which will continue to reinforce their strong base to our business. Regarding our market, chronic sinusitis continues to be one of the most prevalent diseases in the U.S. with approximately 540,000 of these patients undergoing sinus surgery each year. We estimate that almost one in ten of these patents now receives PROPEL with our goal to become the standard of care for sinus surgery. Now let's talk about the four drivers of growth we outlined at the beginning of 2016. First we continue to work to build a seasoned sales force. On average our territory managers delivered $1 million of annualized revenue in the first quarter further reinforcing our dealer progress that territory mangers in our tuck 25 territories produce on average an annualized $1.3 million of revenue this past quarter. These tapped territories are diverse in geography and character and are located across the country with some focused on major metro areas and others ranging across states. On average the territory managers in this group have been with us for 19 months, significantly more than our TMs on average. We're pleased with the early contributions we've seen from the addition of sales consultants and now have 22 in the field albeit early. We're seeing a meaningful impact of having a sales consultant partner with a territory manager to drive depth with our customers. One interesting observation is that territories with a territory manager, sales consultant team grew by 42% in Q1 versus Q1 of last year. We will continue to expand this team strategy in high potential territories. Switching gears to reimbursement, as we shared previously CMS reimbursement for sinus surgery procedures increased at the start of the year. This increase has the potential to be a positive factor for us creating more room to accommodate new technologies like PROPEL. We also want to touch on another element of the reimbursement landscape that we're seeing since the introduction of our Category III CPT codes earlier this year. Some pairs that previously had no medical policy on PROPEL have posted policies dealing the user PROPEL to be experimental or investigational. While PROPEL is typically paid for out of the existing procedural reimbursement, these pair published polices can have a negative influence on administrators who can play a gatekeeper role in allowing access to medical technologies. That said, we believe this policy evolution is just one step in the multi-year multi-step process we’ve described previously. We continue to believe that our growing body of clinical evidence and cost effectiveness data combined with a typical payment mechanism used by the majority of our customers will support the growing adoption of PROPEL. Finally, we were pleased to receive FDA approval of the use of PROPEL mini in the frontal sinus. This approval enables us to access an incremental target market of approximately 135,000 procedures a year that involve treatment of the frontal sinuses. The approval came at the very end of the first quarter and while early we've received encouraging feedback from our field team and physician customers regarding the expanded indication as well as the additional clinical evidence supporting the value of steroid releasing implants. Based on our preliminary experience, we continue to believe that incremental sales of PROPEL mini from the use in the frontal is one of our most important drivers of growth in 2016. To recap, we believe that with our strong base of business combined with these emerging drivers of growth, we remain on track to deliver $78 million to $80 million in revenue this year. Let me now turn the call over to Jeri to further discuss our Q1 results and outlook and then I’ll now review our clinical pipeline.

[Jeri Hilleman:]

Thank you, Lisa. Lisa has addressed our Q1 revenue, which represented a 25% increase over the first quarter of 2015. Our gross margin in the first quarter was 80.8% which came in at the high end of our guidance range and which compares favorably to our Q1 2015 gross margin of 79.1%. This year-over-year increase is due to a number of factors including a price increase in the first quarter as well as gains in production efficiency. Our first quarter operating expenses totaled $21.9 million compared with $15.9 million in the first quarter of 2015. SG&A increased by $4.8 million over Q1 last year and R&D by $1.2 million. These increases relate primarily to expansion of headcount added in support of our commercial and pipeline activities. Our first quarter stock-based expense was $1.9 million for the quarter versus $1.2 million last year. Finally our cash balance at quarter end was $117 million, representing a net use of cash during the quarter of approximately $7.3. For the year as Lisa noted, we continue to target $78 million to $80 million in revenue, a growth of 27% to 30% over 2015. We're also maintaining our other guidance points of 80% to 81% gross margin and of approximately $92 million in operating expenses. We also continue to anticipate a net use of cash of approximately $25 million for the year. I'd now like to turn the call back to you Lisa.

[Lisa Earnhardt:]

Thanks, Jeri. As you know on March 23, we received FDA approval of the use PROPEL mini in the frontal sinus. We're excited about the potential of this new indication to drive usage, supported by the PROGRESS study, a randomized blinded 80 patient trial that demonstrated statically significant 38% reduction in the need for post operative interventions using PROPEL min in the frontal sinus. We were pleased that this data is very similar to that for PROPEL in the ethmoid sinus. Anecdotally physicians are responding positively to both the data and use of PROPEL mini especially since the treatment of the frontal sinus can be particularly challenging. We're starting to see some physicians use PROPEL mini in the frontal sinus for the first time as well as some physicians who historically not found a role for PROPEL in their practice a valuable use of PROPEL mini in the frontal. We're also happy to now communicate that we completed enrollment of the nova study in March nine months after study commencement and a little ahead of schedule. We expect to announce preliminary topline data on this study within the next 30 days. Our RESOLVE product designed for patients who have had sinus surgery who return with recurrent symptoms due to polyps continue to progress through development nicely. We remain on track for completion of a RESOLVE II pivotal study midyear and we expect to announce preliminary data around the end of this year. Despite some initial challenges we are off to a fine start to the year, remain committed to our annual guidance and are thrilled with the progress in moving our pipeline forward. We are dedicated to providing solutions across the continuum of care for chronic sinusitis and we're exciting that more and more innovative physicians are recognizing the value we're bringing to them the healthcare system and most importantly their patients. With that Jeri and I will remain on the line to answer questions. Danielle, let's go ahead and open up those signs.

[Operator:]

We will now begin the question-and-answer session [Operator Instructions] The first question comes from Mike Weinstein of JPMorgan. Please go ahead.

[Robbie Marcus:]

Hi this is actually Robbie Marcus in for Mike. I wanted to start with the sales force and maybe you can comment, it looks like you actually lost two sales reps during the first quarter. What's going on in terms of the churn there? Did you address the problems that you saw mid last year? And then is that the factor that’s driving the significant deceleration in growth or is it something other fundamental that you're seeing in the market?

[Lisa Earnhardt:]

Yeah Robbie thanks for the questions. We do expect to see ups and downs over time in our sales force as we manage territories and personnel. So specifically around Q1, the turnover does include consolidation of a few territories where we felt that specific market conditions were not tracking to our goals. So that said we are in the process of creating a few new territories so all part of the driving growth as we as we learned.

[Robbie Marcus:]

Okay. So maybe just sticking with the growth here, we saw significant growth 70% on average at the beginning of 2015 call it 45%, 50% in the back half of last year now 25% in the first quarter. So maybe you could talk exactly why the deceleration in growth and how you're thinking about that acceleration over the rest of the year.

[Lisa Earnhardt:]

Yeah. So I think you're right. A big factor there as I just commented was around field staffing. So we started the quarter at 74% ended the quarter at 67%, obviously now we're back up, but we did have a number of open territories. We think it's that right thing in the long run especially some of the territory adjustments we've made. We do feel confident in our outlook for growth for the year. We believe the growth drivers we have are really emerging. We just got the frontal indication at the end of the year. We're just starting to see the impact of the expansion of the sales consultants. And you know we've work to continue to season our sales force and as time goes by that continues to evolve.

[Robbie Marcus:]

Great and then last one from me, how are you -- are you comfortable that the sales force disruption or changes are behind you now and we won't see any then second quarter is that something that's going to continue to play out over the next few months.

[Lisa Earnhardt:]

Yeah we always expect to see some ups and downs, but I think we feel like we're really a critical mass in terms of our sales force and we’ll plan to add a much smaller number of new folks as part of the team this year. So we're looking at 10 to 15 total as part of our sales organization. So as a percent that disruption if you will, that you referred to would be much less than it was this past year.

[Robbie Marcus:]

Okay. Great. Thanks a lot.

[Operator:]

The next question comes from Bob Hopkins of Bank of America. Please go ahead.

[Bob Hopkins:]

Okay. Great. Thanks for taking the questions. I am sorry if there is background noise, I am on a cell phone. So couple quick questions. First, we were modeling account at to be more may be close to 130, 150 is the 100 is a function of some of the sales force issues that you talked about?

[Lisa Earnhardt:]

I think sales force certainly can be part of it but overall it's our expectation that we will see a lower level of account add then we did last year, which is really reflective of where we are in our growth, our level of penetration and we’re continuing to add accounts both in ASCs and in the hospital setting and as are most significant driver. So we will be seeing probably a little bit lower level of account adds this year than we did last year, just as it went down from 14 to 15 we saw a decrease of about 700 accounts to about 550. We’ll probably see a lightning overall of new accounts. But again since we have a strong recurring base of business this will continue to support growth.

[Bob Hopkins:]

And you guys are obviously forecasting an acceleration in revenue growth from the current level, can you give us a sense is that something that is going to happen each and every quarter from here or is it little more backend loaded? I’m just curious as to how you think the progression will play out given the some of the things you're talking about here.

[Lisa Earnhardt:]

Yeah, we certainly do expect to see increasing rates of growth as we go forward in the year. Really it's attributable both to all the factors at least I went through earlier in the call and we see frontal starting to become a factor in the second quarter certainly, which is helping and then that I think will just continue to pay out increasingly favorable as we go through the year.

[Jeri Hilleman:]

Yes but I do think the growth is really more heavily weighted in the second half of the year versus in the first.

[Bob Hopkins:]

Okay. Thank you for that and then just really quickly lastly, you mentioned some things on the sort of puts and takes on the payment side. I was wondering if you could if you could just elaborate, is this something that you expected where have you seen some surprises. Are there any other one or two big announcements that are worth highlighting? I just want you to put that in perspective for us.

[Lisa Earnhardt:]

No Bob, as you know that the payers typically is usually the first half if they are going to post the policy for that first policy to be investigational experimental. We do believe the category three CPT code that went into effect in January was, likely the trigger for some of these payers. So from my perspective it's really just the timing thing and this is all part of a normal evolution as we work through coverage with payers.

[Bob Hopkins:]

Okay. All right, terrific. That’s all I have for now. Thank you very much.

[Lisa Earnhardt:]

Thanks Bob.

[Operator:]

The next question comes from Suraj Kalia of Northland Securities. Please go ahead.

[Suraj Kalia:]

Good afternoon, everyone.

[Lisa Earnhardt:]

Hi, Suraj.

[Suraj Kalia:]

So Lisa let me start our or Jeri for that matter, what percent of the propelled procedures have been done independently right now I guess the reason I ask is just a normalized forward revenues. If rep turnover is natural in any company I’m just trying to see if Intersect is more sensitive to rep turnover or any color on the number of procedures independently would be great.

[Lisa Earnhardt:]

Yeah, that’s an interesting question. We don’t track that, but the majority of the procedures that are done with PROPEL today are done without a representative present. We don’t as you know have to be there for the physician to use after the first couple of procedures however we do know in driving that adoption and the more were there, the more likely it is to convince physician I think expensively about their use. And so that’s where we do believe having a couple of territories open in Q1 was a factor especially for those physicians who were on that adoption curve. If they're not all the way up to that if we’re not there, sometimes they can be out of sight, out of mind and so we’re thrilled to be in a position now that we have our territories billed and are looking forward to growth moving forward.

[Suraj Kalia:]

Fair enough and Lisa my memory fails me here, what was the distribution or what has been the distribution of Medicare versus private pay patients I guess some just trying to understand on one hand there has been an uptake in FES reimbursement. On the other hand if some of the private payers are putting in policy revision of experimental or investigative, just trying to see the puts and takes here and what the net effect could be?

[Jeri Hilleman:]

Yeah, the percent of patients who are Medicare is around 10% of this patient population, the average age is around 40 and so they're typically covered by commercial payers. That said typically the commercial payers will follow the Medicare rates and use that as a metric if you will in setting their own rates. It will however take time for those rates to flush through the private payer market. I did want to clarify as well for the category 3 CPT code, those aren’t really directly relevant today to the procedures that are done in the office setting. Those codes are really designed specifically for use of a steroid releasing implant in the office setting when that really is the only procedure being done. That said the fact that there are some investigational products that are in -- patient policies that are associated with our products that just gives administrators another reason to question bringing the new technology in or allowing expensive use of individual site. And so whether is it necessarily a direct impact today from the CPT code because they're not applicable in the OR setting its still has cost and administrators to take pause.

[Suraj Kalia:]

Fair enough and finally Jeri, in terms of PROPEL many how are you looking at vis-à-vis FY '16 guidance in terms of contribution any color there would be great. Thank you for taking my questions.

[Jeri Hilleman:]

Yeah, I think where we've characterized it that overall we're looking to see an increase in pro rep productivity of about 10% going from 900,000 to a million. We've not itemized the contributors to that growth. It's certainly influencing impacted by the four factors that Lisa just went through in the call today, but we certainly do see FRONTEL as one of the more significant contributors to that rising productivity.

[Suraj Kalia:]

Thank you.

[Operator:]

The next question comes from Richard Newitter from Leerink Partners. Please go head.

[Unidentified Analyst:]

Hi, good afternoon this is Roby in for Rich can you hear me okay?

[Lisa Earnhardt:]

Hi, Roby?

[Unidentified Analyst:]

Hi, thanks for taking the question. So, just a little bit more on the sales force turnover and rehires, curious about the sales consultant territories that are up 41% 42% with the consultants are these matured territories like New York you've talked about in the past or it is in those territories that have been slower to adopt and that’s where you're focusing the efforts? And then I have a few follow-ups after that, thanks.

[Lisa Earnhardt:]

Yeah where -- the 25 territories which were referred to were sort of those top territories of the $1.3 million and then you were asking specifically around the sales consultants from those territories and it really is in range. We look at the addition of a sales consultant when we see an established pace of business that still has strong legs for growth really, really looking at the opportunity there and may those decisions. So it really isn’t specific to anyone geography. They do tend to be territories where we've been in longer and just because those are more well established and part of the sales consultant what they really help the territory manger is continue to maintain and nurture our existing accounts.

[Unidentified Analyst:]

Great, thanks and then the comment on the 10 to 15 ads that are remaining at the year, is that a gross number or net number? We have you guys exiting '16 with about 80 reps is that still the bogie and also how should we think of that from a productivity growth standpoint I think last time we spoke is a steady increase throughout 2016 is that still the case? Thanks.

[Lisa Earnhardt:]

Yeah, we would see an increase as we go through the year to answer you last question first. In terms of the number of a lot of handful of territory mangers we started the year with 74. So you're in the right order of magnitude for the number of territory managers. And I made a reference earlier to we do see an increase in productivity of our sales force on average throughout the year, but definitely with some of the drivers of growth just beginning to gain traction now.

[Unidentified Analyst:]

Okay. Great, but you still expect about 80 exiting the year is that right way to think about it?

[Lisa Earnhardt:]

We have not given a specific number, but if we’re adding 10 to 15 I think it’s reasonable to think a handful of them may be five or so would be territory managers each quarter.

[Unidentified Analyst:]

Great. Thanks.

[Operator:]

Okay. And the next question comes from Ben Andrew of William Blair. Please go ahead.

[Ben Andrew:]

Good afternoon. Thanks for taking the questions. The first one I guess for me briefly, can you just give us a sense what the ASP increase was in January you’ve talked about pricing with us in the past?

[Lisa Earnhardt:]

Yeah, we increased from $730 a unit to $750 a unit. It’s an increase that's fairly similar to what we did in a year ago from 2014 to 2015 we went from $695 to $730. This increase was $730 to $750.

[Ben Andrew:]

Okay. And then the gross margin progress was encouraging is 50-50 price we probably got do some math, but 50-50 price versus changes in production and how much further can you take that the improvement on the manufacturing side?

[Lisa Earnhardt:]

Yeah, both were factored I think 50-50 is probably reasonable assessment. We've guided to 80% to 81% for the year. So we're certainly in range of that guidance at the higher end of it and I think as we have just PROPEL as a product. we’ll continue to see improvements over time as we added new products longer term, we’ve always said that 80% is a good long term planning number.

[Ben Andrew:]

Okay. Great. And then coming back to the CAT 3 dynamic and just the overall reimbursement environment in the hospitals, how often is that CAT 3 question coming up? Is it 5% at a time, 50%, it can’t be too often and what arguments can you make to offset that because obviously it’s a totally different setting and you got approval you got label indications, you got some arguably good arguments on the other side.

[Lisa Earnhardt:]

Yeah, you're absolutely right Ben. It is starting to come up somewhat really with the institution of the investigational experimental policies. That said I think the fact that we have such a strong clinical evidence. We’ve got the cost effectiveness data, one article published about a year and half ago we just had an additional article published looking at budget impact and really with the physician support we’re able to work through that, but it does add an additional hurdle through that process.

[Ben Andrew:]

Okay. And then maybe just to think through the impact of the change in the number of territories in the quarter and the rep turnover if you look at same-store growth away from those groups, can you -- it wasn’t the growth de demonstrably faster than the corporate average or how -- is that a better metric if you will to try to isolate that effect?

[Lisa Earnhardt:]

Yeah Ben, we really look at our recurring revenue rate, which we’ve seen as very consistent. We do see a high rate of recurring business coming from about 90% of our accounts in any given quarter. So I think we’ve seen a good deal of stability and growth in there. We haven’t really -- we talk explicitly about same-store sales.

[Ben Andrew:]

Okay.

[Jeri Hilleman:]

And obviously those territories that had full staffing for the full quarter intuitively did better -- it did well, which is really encouraging for us.

[Ben Andrew:]

Sure, Okay. And the last one from me, with the frontal indication I know its early days, but how offer are you seeing clinicians using it in both sinuses, both ethmoid and the frontal because hypothetically it could be four obviously stents in total. I know that all the patients don't have both set of disease, but how do you think about that overlap? Are we going to move from a situation where it's two stents per patient that get used in 2.2 or is 2.83? I’m sure you’ve looked at some of them.

[Lisa Earnhardt:]

Ben it's something -- first of all it is early as you said I think we're in the fifth full week of the PROPEL mini frontal indication launch and we're treating it just like that a launch because it is really important both the expanded indication, but also the additional set of data, which is very complementary to what we have with our PROPEL studies that we did. We do from a modeling perspective really thinking about as a modest increase in devices per patient, but really what we believe it does is expand the pool of patients who physicians will treat -- will choose to treat with PROPEL and PROPEL mind product.

[Ben Andrew:]

Got it. Okay. That’s helpful. Thank you very much.

[Operator:]

The next question comes from Kyle Rose of Canaccord. Please go ahead.

[Kyle Rose:]

Great. Thank you for taking the question. Can you hear me all right?

[Lisa Earnhardt:]

Sure can Kyle.

[Kyle Rose:]

Great. So just wanted to see to circle back on the sales force, wondered if you could give us what the average tenure of the sales force was? I appreciate the top 25 territories at the average of 19 months, but what it looks like across the whole 72 member sales force? And then also what the historical productivity ramp has been up to that $900,000 or $1 million mark? Is any nuances you're seeing now with the new hires?

[Lisa Earnhardt:]

Yeah. And so we think the average tenure, I don't -- is around about a year or so for the entire sales force and in terms of productivity we continue to see increases of productivity in our more tenured territories. We spoke to that in the context of looking just at our top 25 territories just to give you some perspective already at $1.3 million annualized territory run rate. So we feel very confident in our ability to continue to drive leverage with the strong sales team that we have.

[Kyle Rose:]

Okay. Great. And then when you think about the comments on reimbursement in the code is potentially impacting there. When does that conversation normally get brought up? Is that in accounts that you’re trying to penetrate in new potential accounts for the administrator might use that as a reason to push back or have you seen any pushback on the recurring accounts?

[Lisa Earnhardt:]

Yeah it happening -- it could happen equal opportunity right either with existing accounts or perspective new accounts. Where we're do seeing having a more acute impact would be potentially in the AFC setting, the surgery center setting where they to tend to be more price sensitive and so that's usually where if it were to come up where it's primarily being written.

[Jeri Hilleman:]

And the AFCs and we've talked about this before, represent about 20% of our business, so that's certainly the most cost sensitive portion of our business.

[Kyle Rose:]

Okay. No, I appreciate the additional color there and then just lastly any expectations for data to be coming out at the CASA Meeting in a few weeks?

[Lisa Earnhardt:]

No we did share that we would have the Nova data within the next 30 days. So stay on the lookout for that.

[Kyle Rose:]

Okay. Great. Thank you very much.

[Lisa Earnhardt:]

Thank you.

[Operator:]

The next question comes from Tal Levy of Wedbush Securities. Please go ahead.

[Tal Levy:]

Great. Thank you. Just a couple quick ones, the number of PROPEL units that you shipped in the quarter?

[Lisa Earnhardt:]

I'm sorry Tal, you said, what was the number of units?

[Tal Levy:]

Yeah exactly.

[Lisa Earnhardt:]

Our price on the product went up to $750. So I think that can give you a pretty close approximation of units.

[Tal Levy:]

Okay. And any update on guidelines potentially?

[Lisa Earnhardt:]

Yeah that's a great question Tal and in fact in the first quarter there was a publication in the International Forum of Allergy & Rhinology. So if you haven't yet read this issue I’ll provide some of the highlights, but they did develop some consensus guidelines, which did highlight PROPELs level of evidence and that benefits as well as the economic studies that have been done. And what's interesting is they did they were came forward with a split recommendation. So there is the -- most of the things that are used -- supplies that are used in sinus surgery are considered optional and PROPEL was deemed recommended/optional. So is was right on the edge if you will and part of that they did articulate in that guideline, manuscript was just because it hadn't reached widespread use. So that certainly is something that we continue to work forward on, but we encouraged with that. As you know there are two -- there is an existing physician statement from the Physician Society that is supportive about the use of products like PROPEL perhaps not as specific as we would like, but we continue to work with the societies to ensure that their membership has a good view of what their stances around the use of PROPEL, but we were encouraged by the consensus guidelines that did come out and far this last quarter.

[Tal Levy:]

Got you. When you look at some of these policy decisions that have come out from some of the carriers, do they factor these guidelines and for example or even if they...

[Lisa Earnhardt:]

Yeah it's a great question Tal, that’s actually came back in some of the policies is that, it's obviously the clinical evidence. The second thing is around guidelines and the third is typically around widespread use. And we do think the fact that the guideline that exists today from the society isn't specific i.e. it does not specifically call out PROPEL or steroid releasing implants. So given, that it is something that we'll continue to engage with the societies on.

[Tal Levy:]

Perfect. Great. Thank you very much.

[Operator:]

[Operator Instructions] At this time there are no further questions. This concludes the question-and-answer session. I would now like to turn the conference back over to Lisa Earnhardt for closing remarks.

[Lisa Earnhardt:]

Well thank you all for joining us today. We greatly appreciate your interest and support and look forward to staying in touch with you all. Have a great afternoon. Bye, bye.

[Operator:]

Conference is now concluded. Thank you for attending today's presentation. You may now disconnect.