Joanne Wuensch: Excellent. Thank you so much for taking the questions.
Operator: One moment for your next question. And our next question is from Andrew Cooper with Raymond James. Your line is open.
Andrew Cooper: Hey everybody. Thanks for the time. Maybe just to start on with Plasma and sort of the eight to 12 and how we should think about it. Just would love an update with Express Plus nearing kind of full launch. What the strategy is there in terms of how aggressively you try to roll that out to the broad customer base and whether you’re going to use that as a tool to take price, we should view it as a retention tool or really just how we should think about that additional innovation that you’re bringing to the market?
Christopher Simon: Yes, Drew, thanks for the question. We’re really excited about what Express Plus does to take that platform to the next level. The improvement in procedure speed of the base business, very powerful. We’re seeing from what is now 60,000 collections, commercial collections in our limited market release, the product is absolutely performing as expected. And so we’re seeing reductions in up to 20% across the base procedure speed on the base NexSys device. So all good there. Plays into lower cost per liter, plays into improved center productivity. So we will move from limited market release to full market release later this quarter. And our anticipation is we roll from there upgrading the entire fleet. I’m going to stay mute with regards to pricing just given the increased competitive sensitivity across the market.
This is a meaningful upgrade. It also paves the way for anybody who is either using Persona or is intending to use Persona to get those procedure times back well within range of the base NexSys device. So it’s a powerful one, two combination. We think in aggregate, it’s unrivaled and we do expect to command a premium for innovation. Given the improvements that we can point to with regards to lowering CPL and improving donor satisfaction, we feel really confident in our ability to command that premium.
Andrew Cooper: Okay, helpful. Maybe just next, I think James and I think you maybe both mentioned kind of the appetite for M&A and you increased the revolver capacity here. So obviously a lot of ability to go out and do more deals. Just maybe what are you seeing in the space? What’s still exciting? And then how do we think about the comment on looking near-term in interventional cardiology while you’re still sort of trying to digest two recent acquisitions that you’re still bringing into the fold right now?
Christopher Simon: You want me to take a cut of that first?
James D’Arecca: Yes. Look, our near term focus is integration, right? We are highly enthusiastic about the guide wires from OpSens and Esophageal Cooling from Attune. We need to make good on that, right? So we’re well down the path. Closing OpSens early and mid-December was helpful. We spent our fourth quarter cross training the field force. Question was asked earlier about that. There’s a direct overlap in this case with VASCADE in interventional cardiology. So we are going to expect meaningful call point synergy and we revamped our footprint. We updated our comp programs. We did the complete set of training. Some of that still undergoing just given the sophistication of the products. But it’s a combined force moving nicely against commercializing those guide wires.
So we feel great about that. enzoETM, the esophageal cooling direct fit with MVP and MVP Excel now on EP. We’ll get after that beginning in June. And that is our far and away our first and second priority. We do see other opportunities for tuck-in acquisitions in the interventional technology franchise. And so we will action those as the market opportunity presents itself. We wanted to have that capacity on the balance sheet to be able to do that. But we really see those as tuck ins and things that would be highly accretive to growth and profitability as we roll forward. We’ve disclosed previously our relationship with Vivasure. That’s a great example of the type of things that perhaps in the second half of the fiscal year we could pursue. But for now, it’s integration and growth.
And then we’ll leave aside what happens at the back end of the LRP. But we think this model, enabling technology, really agnostic to the underlying therapeutic being used, so it has broad based applications and then superior results because of the capabilities we’ve built. We think that’s a model that’s replicable in other areas. That’s not something we’re going to be talking about this fiscal year though.
Andrew Cooper: Okay, perfect. That’s super helpful. And then maybe just one last one on sort of the margin dynamics. I guess to ask what others have a little bit of a different way. When we think about the roughly 10% or a little bit less than 10% of earnings that you called out from CSL. As we think about that volume kind of rolling off, should it be ratable? Are there sort of step function levels where we see the margins move a little bit quicker or a little bit slower? Just help us think about kind of the pacing there and whether it’s linear or a little bit lumpier in terms of the margin impact of the CSL departure?
Christopher Simon: Yes, Andrew, I think it’s more towards the linear side of the equation there. As it rolls off, we’ve been preparing for this for quite a while, and we have our plans in place to address the associated stranded costs and overhead costs with it. So we think that it should be fairly smooth throughout the year.
Andrew Cooper: Great. I’ll stop there. Thanks, everybody.
Operator: One moment for the next question. The next question is from Mike Matson at Needham & Company. Your line is open.
Mike Matson: Yes, thanks. So I guess I just wanted to ask about how NexSys with Persona and Express Plus, are you comfortable that this is a superior offering to the Rika product in terms of the volume, time and cost of collections with your operator?
Christopher Simon: Yes, Mike, good morning. Short answer is yes, right? There’s not a whole lot of Rika out there to really be able to draw broad based conclusions. We’re now north of 25 million collections with the Persona, NexSys system. It’s performing exactly as advertised. It is above all safe and reliable, which is the anti for this industry, right? So I think the demonstrated safety, the demonstrated reliability of the product and the company gets you halfway there. And then — yes, the speed gains associated with the combination offering of Express Plus, the Persona uptick, really meaningful. We’re the only ones who offer DMS software. In fact, our DMS software today is roughly 80 share of the U.S. procedures. So the integrated offering, what we can bring together and how that can improve center operations, how that can improve donor satisfaction and processing, that’s the piece that we are the only ones doing that.
And it’s an important part of our value proposition and one of things that compels our customers. So broad-based experience, real world evidence and a combined offering, holistic offering that is unique in the marketplace. Yes, we’re quite confident, Mike.
Mike Matson: Okay. Thank you. And then just on MVP XL, so where is that used versus the regular MVP? I guess, what types of procedures? And is there a price premium for XL over MVP?
Christopher Simon: Yes. So MVP XL will expand the base vascular closure offering. It’s pushing MVP to higher levels of French sizes. It should give us really across electrophysiology. It should give us a broad based offering all the way up to include, as I said earlier, all the ablation procedures. There’ll probably be some cannibalization between MVP and MVP XL because the indications are clear, but clinicians are free to use it in a broad-based fashion and MVP works really well. XL will be that much better for the larger French size openings that particularly are typical in PFA. So nice complement. It’s part of our broader strategy. We think about this kind of broadening the shoulders of closure. We want to be a one stop shop for closure, venous and arterial.
This takes us one more important step along that way. We’ve got a pipeline of additional things going on, it will take us down market as well in terms of smaller openings, but more about that as they get ready to come to market. In terms of pricing, in general, we like to think about value-based pricing for our technology. XL brings real value to the market. We expect to capitalize on that. Volume is the biggest driver by far in interventional technologies, but we’re also seeing further price and mix gains. So you should assume that’s going to be factored in as part of the overall guidance.
Mike Matson: Okay, great. Thank you.
Operator: Please standby for the next question. The next question comes from Michael Petusky with Barrington Research. Your line is now open.
Michael Petusky: Good morning. Chris, I just wanted to make sure I’m thinking about this correctly. The 155 to 85 in this year, that’s just the U.S. CSL business. Is that correct?
Christopher Simon: Yes, Mike, that’s exactly right. It’s the U.S. PCS2 supply agreement. It does not cover software. It does not cover the international work that’s all being done today on NexSys.
Michael Petusky: Okay. And I know we’re not talking about ’26, but I just want to make sure because when we talked about this, whatever it was a year ago and you talked about a minimum commitment. There is no minimum commitment from CSL beyond ’26, correct?
Christopher Simon: Yes. Mike, you’ll appreciate it. We just guided for ’25. We kind of want to live into that and execute it. Give us a little time before we’re ready to talk ’26. What I can tell you is in terms of the numerous amendments, what we cared about was being compensated for our staying power and a gradual transition that lets us, as James said, improve the margin, right, in terms of stranded costs. But really, the most exciting part is freeing up capacity in an otherwise capacity constrained system to go serve our other customers, including the conversion and the share gains. So it’ll be gradual. The math is as you laid it out, it won’t be zero by the end of this fiscal year as we’re projecting it. So stay tuned. The $85 million is a minimum commitment.
Just like when we talked a year ago, we were saying something slightly in excess of $100 million, right? And so this is the equivalent number for that. It represents a 45% downward revision from the $155 million that we just completed for the PCS2 agreement. If it changes throughout the year upward, we’ll call that out as we go.
Michael Petusky: And then I just want to, I guess, ask a little bit about vascular closure OUS, and I think you called out that Japan, some good traction with some 90 accounts, I believe I heard, and then Europe maybe a little bit slower. I was just curious, how many countries in Europe are you now in? What do you see as the best targets there? And is there anything just clinically from how treatment is done there or regulatory from a regulatory standpoint that has made Europe a little slower than Japan? Thanks.
Christopher Simon: Yes. Mike, to confirm, Japan is as you described it. We are now in excess of 90 accounts. We’re working with a third party distributor. They’re skilled. They’re executing. We have the benefit that we got very favorable reimbursement as part of the Japanese reimbursement system. So that’s really aided with the initial uptake. In Europe, it’s a different starting point, right? They typically use suturing figure of eight. So it’s less obvious need. There are vagaries from one country to the next around how reimbursement works and differences in terms of the benefit of same day discharge, which we have across the board. So that’s what we are working through. We expect to be successful there for sure. It’s just a slower, more gradual build.
I think this is a good example of going slow and being thoughtful to go faster further down the road. And so from our vantage point, we’re delivering against that. We’re primarily focused, as you would expect, in the big markets. We started in Germany. We had a relationship or set relationships in Italy that we’re capitalizing on. We will quickly proceed to the U.K., and then other major markets, mostly through distribution, where we think there’s strong underlying demand just measuring ablation procedures. So stay tuned, more to come. It will be a gradual build, but we think we’ve got real staying power and want to make sure that one of the important lessons learned from the top 600 in the U.S. is we land and we expand. The landing you have to nail the landing and you have to get it right.
It doesn’t do any good to churn through an account, because we have to go back and reignite. That’s that much harder. So we want to get it right. We want to build from a strong base. We’re working with the best centers and making sure the value proposition is clear and appropriately sustainable.
Michael Petusky: Perfect. Can I just sneak a quick one — a real quick one in on Express Plus? I mean, do you feel like the uptake there, I mean, is this obviously just a handful of customers, I mean, do you — that you need to target? I mean, do you feel like fiscal ’25, most of this will be essentially completed or might this take some time? Thanks.
Christopher Simon: Yes. As we’ve said with our other technology upgrades, we will go absolutely as fast as our customers are prepared to go, but no faster. I think it’s an FY ’25 event, Mike, because the value proposition of Express Plus is so clear, and the demand for productivity is so pressing. So I don’t want to get too far ahead of ourselves here, but our projections call for Express Plus to be implemented this fiscal.
