Establishment Labs Holdings Inc. (NASDAQ:ESTA) Q3 2022 Earnings Call Transcript

Juan Jose Chacon-Quiros: Yes. I think, the focus for us is always on safety first, and that is more so in the breast reconstruction market. So the fact that we can bring to women in breast reconstruction, the possibility of doing an MRI during the expansion process of the breast reconstruction, that they have more comfort and less pain and the possibility of reducing radiation oncology levels are all important to us. Just in this meeting in Thailand one of the scientists that has been involved with Mia conducting an independent study comparing our device to another CE Mark device, showed the results from her research in which patients are responding clearly that this is a much more comfortable option. And that’s the type of things that we want to hear because what we want is breast reconstruction in the future to be viewed through the eyes of women who have suffered breast cancer and after a mastectomy can get better options for the reconstruction.

Operator: Our next question comes on the line of Matt Baylor with Jeffries. Please proceed with your question.

Unidentified Analyst : Hi guys. Thanks for taking the question. So, I just wanted to ask a follow-up. In the press release reiterated the China approval and launch expectations in first half 2023. I was wondering if you could talk about your visibility into that and when we could see that start, anything that you’re doing to prepare for the launch there?

Raj Denhoy: Yes, part of our trip here to Asia has been devoted to update on our different regulatory timelines around Asia. Not only on Motiva Implants, but also on Mia and Flora. So we met with our partners in China and we have reinforced our belief that we will get approval in the first half of next year. Again, the process with the Chinese regulatory authorities is never fully transparent. There’s a quite a degree of a passage in the communication always, but that’s natural to that process. So we are not concerned about it and happy to hear from our regulatory experts in China that they stand by that date.

Unidentified Analyst : Okay, great. And I wanted to ask follow-up on you sort of mentioned in past that the, as a reminder, the facility that you’re building is going to be able to produce half the world’s breast implants, I think you said. So, I wanted to kind of tie that back into your, I guess, confidence and what you’re seeing in some of these other markets where you’ve been for a while and starting to see market leadership. So, I guess all that said, hey, could you give us some examples of where your market share, your leadership is going today in some of these markets where you’ve been and to give you that confidence to, I guess, get to half the world’s share in that facility over time?

Raj Denhoy: Yes, I think the way to think about it is that this market for many decades was led by two big companies basically, Mentor the breast division out of Johnson & Johnson and Allergan. So once Allergan retreated from most of these markets, but the four markets where they compete with Motiva, then I think, market leadership tends to look different. And there are markets already where we have surpassed 50% and continue to grow. So that shows you what technology that is substantially different can do. And I think that’s our job, is to make sure that market leadership can be as high as possible. And remember one of the biggest things that we do is expand markets and we have a lot more work to do, but we actually believe that the fact that you improve the safety levels has an impact in expanding markets.