TransMedics Group (NasdaqGM:TMDX) FY Conference Transcript

Summary of TransMedics Group FY Conference Call (December 02, 2025) Company Overview - Company: TransMedics Group (NasdaqGM:TMDX) - Industry: Medical Technology, specifically organ transplantation Key Points and Arguments Machine Perfusion Adoption - Current adoption of machine perfusion for liver transplants is approximately 40% [14] - The company aims to increase this adoption to 80-90% through aggressive efforts and data publication [14] - Significant survival differences and improvements in post-transplant complication rates are associated with the use of OCS machine perfusion [14] Data and Growth Potential - Major publications from liver registry data are expected in the first half of 2026 [17] - DCD (Donation after Circulatory Death) liver adoption is around 60%, while DBD (Donation after Brain Death) is only in the mid-20s, indicating room for growth [18] - Approximately 70% of DCD livers are currently discarded, presenting a significant opportunity for market expansion [18] Transplant Goals - The company is confident in achieving a target of 10,000 transplants by 2028, regardless of additional growth opportunities [23] - The growth strategy includes increasing utilization in existing centers and onboarding new centers [26] Competitive Landscape - The company welcomes competition, viewing it as a means to maintain market integrity [131] - TransMedics has a strong balance sheet with nearly $500 million, which will be invested back into the business [131] Clinical Trials and New Technologies - Enrollment for heart clinical trials has begun, with expectations for lung trials to start by early January [38] - The company is optimistic about replicating the success seen in liver transplants for heart and lung transplants [42] - A new Gen3 OCS system is in development, aimed at significantly improving efficiency and reliability for future transplant volumes [126] Kidney Transplant Market - The company plans to enter the kidney transplant market in 2027, which has a potential volume of 23,000 transplants annually [100] - Current kidney utilization rates are low at 60-65%, and complications post-transplant are high, indicating a need for improvement [105][106] Financial Outlook - The company aims to achieve an operating margin of 30% by 2028, driven by growth, disciplined operating expenses, and margin protection [69][136] - There may be a slight impact on gross margins due to costs associated with clinical trials [66] Operational Efficiency - The company is working on increasing the efficiency of its transportation logistics, including double-shifting pilots to maximize jet utilization [73][80] - The goal is to run jets more efficiently, potentially reducing the need for additional aircraft purchases [78] Conclusion - TransMedics Group is positioned for significant growth in the organ transplant market, with a focus on increasing adoption of machine perfusion technology, expanding into new organ markets, and maintaining a strong financial outlook. The company is actively working on clinical trials and new technologies to enhance transplant outcomes and operational efficiency.