NeuroPace(US:NPCE)2022-03-10 23:54Financial Data and Key Metrics Changes - Total revenue for Q4 2021 was $11 million, a 2% increase from $10.8 million in Q4 2020 [32] - Initial implant revenue in Q4 2021 was $8.5 million, representing a 10% growth over Q4 2020 [11][32] - Full year 2021 revenue was $45.2 million, a 10% increase compared to 2020 [12] - Gross margin for Q4 2021 was 73%, down from 76% in Q4 2020 [35] - Net loss for Q4 2021 was $10.7 million, compared to $4.6 million in Q4 2020 [38] Business Line Data and Key Metrics Changes - Initial system implants accounted for 75% of total revenue in 2021, growing 20% over 2020 [12] - Revenue from replacement implants in Q4 2021 was $2.5 million, a 19% decrease compared to Q4 2020 [34] - The number of active implanting accounts increased to 150 in 2021, up from 132 in 2020 [33] Market Data and Key Metrics Changes - The company experienced a decline in procedure volumes in January 2022 due to COVID-19 variants, but saw improvement in February and March [14][15] - The company anticipates that EMU volumes will eventually return to pre-pandemic levels, creating significant opportunities for growth [16] Company Strategy and Development Direction - The company plans to increase the number of implanting centers and enhance utilization of the RNS System [17] - Targeting epilepsy specialists outside of Level 4 centers to expand patient access to the RNS System [18] - The company received FDA approval for the NAUTILUS pivotal trial to expand indications to include primary generalized epilepsy [21] Management's Comments on Operating Environment and Future Outlook - Management remains cautious about near-term uncertainty due to COVID-19's impact on hospital and patient behavior [39] - For 2022, the company expects revenue to range between $45 million to $48 million, with initial implant revenue projected at $39 million to $42 million [40] - Management noted that the longer battery life of the neurostimulator will reduce replacement revenue in the coming years [27] Other Important Information - The company completed a successful IPO in April 2021, raising net proceeds of $105.5 million [30] - As of the end of 2021, there were 282 patients actively treated with first-generation devices, with a significant number expected to reach the end of their battery life in 2022 [28] Q&A Session Summary Question: How does the company view the trends for Q1 and the impact of COVID? - Management indicated that Q1 guidance of $10 million to $11 million is based on observed trends and assumes improvement in COVID conditions [45][46] Question: What are the barriers to adoption aside from COVID? - Management highlighted the need for increased education among physicians and expanding the number of prescribing doctors within comprehensive epilepsy centers [64][66] Question: When does the company expect EMU patient volumes to return to pre-COVID levels? - Management assumes that EMU volumes will not significantly impact revenue in 2022, with a return to pre-pandemic levels expected later in the year [60] Question: How does the company plan to utilize the expanded sales force? - The focus will be on increasing utilization within existing centers and bringing on new centers, particularly targeting epilepsy specialists outside Level 4 centers [52][54] Question: What is the expected impact of clinical trial revenue for 2022? - Management expects minimal revenue from clinical trials in 2022 due to conservative assumptions around reimbursement and timing of patient enrollment [80]