Rick Buchholz: Yes. There will be — from a OUS perspective, we’re not — we don’t give quarterly guidance from an OUS and US perspective. But we did see some catch-up in the first quarter. Outside the US, we did have a strong first quarter. But we expect to see some additional catch-up into 2024 but to a little bit lesser extent. So we’re not guiding towards any sequential growth outside the US but we look forward to continued good numbers outside the US.
Adam Maeder: And if I may, just with a follow-up. I wanted to ask about SURMOUNT-OSA, data came in pretty much as expected down the fairway. I did want to ask how you’re thinking about any potential impact to the patient funnel either in the back half of ’24, ’25? Are you hearing anything in the field from docs or reps, will folks look to potentially try a GLP-1 before going forward with an Inspire procedure, or do you think there’s going to be no impact to the funnel?
Tim Herbert: So we talk to all our docs and we talk to our field. We do hear discussions around the GLP-1s and we know the patients with high BMI tend to get screened out with the sleep endoscopy and there are patients who have reported being able to use the GLP-1 to be able to lose weight and therefore, qualify for Inspire. So very early, early days. But we do get positive reports on that and look forward to continuing to focus on that as we move through the rest of the year.
Operator: And I show our next question comes from the line of Kallum Titchmarsh from Morgan Stanley.
Kallum Titchmarsh: Just on the recent commercial insurance update. I know some of the policies kicked in, in March. Curious to hear about any early interest or momentum you’ve seen from those high BMI and HI patients, as well as the pediatric down intrim population as well, now they’re in scope for coverage. Just any color on initial progress there would be great.
Tim Herbert: I think we see more progress with the high AHI, the high Apnea Hypopnea Index, because that’s a natural step for those patients to be able to receive approval. And we’re able to move some of the prior authorizations in process to bring them in and then move them forward. With the high BMI approval, remember, that’s just a change to the warning to allow patients with a BMI up to 40, but it’s still very important that we treat tongue base collapse versus lateral wall and we do today still use sleep endoscopy to screen those out. So not that significant of an impact with the high BMI yet, but that’s something as we just talked about with the GLP-1s that perhaps we can leverage that to take advantage there. And the fun news is with the pediatric population, it’s a group that we really care about.
We continue to grow the awareness there and we are opening up additional children’s hospitals to be able to participate with Inspire. So we’re starting to see some movement with that population as well.
Operator: And our next question comes from the line of David Rescott from Baird.
David Rescott: I wanted to follow up on the kind of profit or the positive kind of profit guidance that you gave for the full year. Maybe just wondering what some of the bigger drivers are behind that? I know you talked about some more targeted kind of DTC spend in 2024 previously. Wondering how big of a piece that is? And when we think about the cadence of that through the year, should we expect that to be more back end loaded where you have a pretty positive Q4 that kind of outweighs the losses in the rest of the year do you think in Q3, you have the potential to deliver a positive quarter as well?
Rick Buchholz: So yes, in the first quarter, our DTC spend was $26 million, a little bit increase over year-over-year. But as we’ve talked about in the past, in 2023, we spent about $100 million in DTC. And as we mentioned, with the increased demand, from patients, physicians and adding new centers, we’ll continue those investments. But again, that rate will really be moderate, nearly flat for 2024, because we are focusing on more targeted digital advertising to go after qualified patients and hopefully improve that conversion. So from a profitability standpoint, as we continue to increase revenue, DTC spend will be flat versus 2023. R&D, we’ll continue to spend high teens percentage of revenue. And so that leverage will be gained in increased utilization.
And so we put forth the new guidance and that we’re excited about, which is the bottom line of $0.10 to $0.20 earnings per share on the bottom line. We mentioned before that we’d be profitable for the second half of the year and now we’re guiding to profitability for the full year. But we haven’t broken down in which quarter that we turned that corner but we’re excited about the ability to be profitable for the year.
Operator: And I show our next question comes from the line of Anthony Petrone from Mizuho.
Anthony Petrone: Thanks for getting us in here this afternoon, hope everyone is doing well. One dynamic on in the US to explore a little bit, just the sort of push out of Inspire V. Do you think there’s maybe a little bit of pause that you saw in 2Q that could maybe extend in 1Q that can extend into 2Q? How did that dynamic play out in the quarter? And then I’ll have a quick follow-up.
Tim Herbert: No, we don’t see any delay. We like with the progress we make with Inspire V and the packages are fully put together and it’s in review with the FDA, and we’re running our program and turning our soft launch later this year and a full launch in ’25. So we still remain very, very excited about the Inspire V portfolio that we’ll be launching.
Anthony Petrone: And maybe just to level set going back a little bit to UnitedHealthcare and the expanded coverage there. They did have one sort of preemptive step with mandibular repositioning devices. It seems like a minor step to us. Yet that label has greatly expanded, the coverage is greatly expanded to match FDA. So maybe just a little bit on the push/pull there. Do you think there’s any slight hiccup from mandibular? But on the flip side, it seems like this is a great — an expansive opportunity just from overall coverage standpoint. So how does that push and pull play out through the remainder of the year with United specifically?
Tim Herbert: I think that’s a very good observation that you made there. And I think that we agree that the upside with the high AHI specifically and as well as to the pediatric population far outweighs the documentation that we put into the prior authorization for mandibular advancement devices or oral appliance therapy. And we think that, that — our team works to make sure that the healthcare providers have the proper documentation in the prior authorizations that go to UnitedHealthcare. So we don’t see a significant challenge from documenting the oral appliances, but we do see good upside with especially the high HI and then secondarily with the pediatric population. So yes, great observation.
