Mike Polark: Thank you.
Bill Cozy: Sure, Thank you for the question.
Operator: Thank you. Our next question comes from Adam Maeder of Piper Sandler. Your line is now open. Please go ahead.
Adam Maeder: Hi. Good morning, guys. Thank you for taking the questions and congrats on the next quarter. I wanted to start on CP…
Bill Cozy: Hey, thanks. Good morning.
Adam Maeder: Good morning. I wanted to start on specifically CP and heart-lung machines. And I think you said that segment grew 25%, HLMs did in Q3. I’m curious if you can just talk a little bit more about the Essenz rolled out. What was the contribution in the quarter from Essenz? How many systems did you place? And how do you foresee that evolving going forward? And then also just remind us on the pricing strategy relative to S5 and then I had a follow-up. Thanks.
Bill Cozy: Sure, thanks for the question. We did move, as I mentioned in my earlier comments, to kind of a full launch. And for sure, our HLM revenue growth was driven primarily by Essenz installations in the U.S. and Europe with just some S5 placements in the rest of the world. All of our Essenz orders to-date are achieving the expected price target. We have talked in the past that we were expecting to, because of the quality advancements in technology in Essenz, we were hoping to get around about a 30% price premium above traditional S5. At this very early stage, all of that expectation is being achieved. We’re not yet at a point where we’re going to start talking about units placed. What we actually are enthused about is the quality of our pipeline and funnel and the customer interests that we’re seeing in both U.S. and Europe.
So what we hope to do is prove ourselves even to the next level, if you would, in the fourth quarter, and then we can circle back some more on Essenz performance as ‘24 starts to roll out.
Adam Maeder: That’s great color, Bill. Thank you for that. And for the follow-up, realize you’re not — you’re a little bit limited in terms of what you can see on ‘24, but I did want to ask about the heart failure program closure. I think that’s $24 million to spend this year. Any updated thoughts, even just broad strokes on how you think about that spend as it relates to next year, letting that flow through to investors versus reinvestment in the business? And then I guess I’ll test my luck and also ask about associated spend with depression and OSA next year as well. Thank you.
Bill Cozy: Because — you’re letting me, I’m going to have Alex comment on our heart failure. He’s got his real tight handle on our game plan there.
Alex Shvartsburg: Hi Adam. So look our heart failure program, we continue down the path of closing that out by the end of the year. We expect some residual cost into next year. We’re — you know we’re looking at you know our capital deployment as part of our budgeting process. We’ll update you guys as we end Q4 on all of our expectations for performance in next year.
Bill Cozy: And to close out on your DTD OSA questions, what we did, as you would expect in our business planning, is the best we can do, given the little bit of uncertainty that resides, particularly on DTD, is do scenario planning. We have completed scenario planning for a possible launch of that product, obviously not until we get into ‘25, but we would have to start to prepare our homework for late 2024 commercial activity. That’s what we’ll talk about when we get into our fourth quarter review. And we’ll actually be prepared to give you quite a bit of insight, I think, in both of what we’re going to try and do, why we’re going to do it, and what that spend will be. As you would already asked, there are more than a few moving parts there.
And so we’re going to take the benefit of the next couple of months to really button that down, but we have a really good kickoff on that planning effort. And of course, the scenario has to operate under the financial premise that depression has a chance to be a goal and more details to follow.
Adam Maeder: All right we’ll stay tuned. Thanks again.
Bill Cozy: Hey thank you.
Operator: Thank you. Our next question comes from Matt Taylor of Jefferies. Your line is now open. Please go ahead.
Matt Taylor: Hi. Thank you for taking the question. I guess, I was wondering if you could talk a little bit more about the epilepsy dynamics, you know, under the hood and give us some color on trends in new patient starts, you know, the replacements, also the things that you’ve been doing with your salesforce, you know, how the landscape’s been with the centers opening and maybe carry that forward and talk at least at a high level about what to expect with those dynamics next year?
Bill Cozy: Hey, Matt, thanks. We’ve got the benefit of having Steph here, and she has been spending ordinate amounts of time on these two topics. So I’m going to just turn that question right over to Stephanie Bolton.
Stephanie Bolton: Thanks, Matt. So as mentioned during the last call that we had, we’ve really been focusing on producing consistent performance and having a consistent execution. And I continue to be encouraged by what that looks like with the team, particularly in the U.S. So we keep leaning into our consistent operating mechanism and focusing on the fundamentals of the collaboration between the different groups. Our Q3 was another, sort of, consistent execution quarter. And our NPI entirely in line with our expectations, given how we exited Q2. So I’m really pleased that we’ll continue to anticipate that normal run rate as we move through towards the end of the year. So in terms of the sales teams, they are very much focused on our customers that have the most amount of opportunity to treat our DRE population.
And we continue with our CEC strategy with our cams in the field. So everything is moving in a very nice direction and we continue to work on our consistent execution.
Matt Taylor: Very good. Anything notable to call out in terms of changing dynamics next year in the business?
Stephanie Bolton: No, no, notable changes as it stands now. We have full and appropriate coverage in the U.S. of our CECs and they remain our firm priority moving forward.
