Doug Godshall: And if you want to Venmo me, Patrick, I’m receptive. I’ll give you my numbers. So, yes, we continue to be very receptive to smart strategic external opportunities. Maybe emphasis on smart or trying to be smart at least. We raised the convert with the — recognizing that there was a window where valuations for private companies were down, and they still are. It’s very hard to raise money for small companies. And valuations have said private companies were — and willingness of boards sort of had changed over a 12, 24-month period. And we didn’t at middle of last year, we did not have the cash wherewithal to make offers on some on properties that we might have — might be interested or thought we might be interested in, and we realized that the convert structure and terms were just so attractive that having a 1% coupon in a period where we can — we’re netting a nice interest income relative to our interest expense right now and we didn’t raise the money so that we could invest the money we raise the money so that we could be opportunistic if something came along.
That said, the worst thing you could do is just because you have cash run out and buy something that is not smart to buy. And so if at the end of the day, we don’t see anything that we think is going to be accretive to our growth and accretive to our shareholder value, then we’ll sit on the cash until we find something that is worth investing in. That gives us tremendous amount of strategic flexibility that we’re, we feel really fortunate to have for a company at our stage to be growing at our rate to be profitable and have this much cash on the books is really, we recognize the unique position we’re in. But we don’t feel obligated to run out and spend that money on something because then we would be more likely to do something that wasn’t smart.
Patrick Wood: Totally. And maybe as a quick follow-up, the slightly more bigger picture, and I know we don’t talk about OUS that much, but when do you think you’re going to get to a point of a body of clinical evidence that can kind of help unlock some of the penetration in some of the other markets? Obviously, Germany went your way recently. And I know in the UK, nice sort of reformulated that language around peripheral. But just kind of — is there like a critical mass of evidence that you feel is needed to unlock the markets? Or is it something else?
Isaac Zacharias: I’ll take a shot at that. I think in many of the markets, it’s unlikely that at least with our coronary and our peripheral IVL that will amass enough evidence that those systems, kind of the National Health Systems will increase or give extra payment for IVL. I think it’s, those are generally going to need to be large, randomized studies, showing cost effectiveness compared to other products. And we just don’t see those studies being necessary, really, one, but also, we’re not — we talked about this a lot internally. We don’t know what to randomize against. Because we don’t randomizing against the balloon, we don’t think it’s an appropriate study, randomizing gains at direct me, we don’t think it’s an appropriate study.
There are different tools for different clinical situations. So, we’re working on it. We have, Japan, we’re in a good spot. Obviously, Germany, we’re in a good spot. Hopefully continue to get better. Our JV is working on regional reimbursement in China, and we’ll make progress there. But I think generally, it’s going to be IVL is going to be paid for out of kind of hospital funds and the budgets they have to treat to treat patients without any incremental payment for IVL.
Doug Godshall: Well, it will be interesting to see is with C2, assuming success in that study. That’s exactly the kind of study that that sham-controlled randomized study, again, assuming it works, it will be undeniable that, that product does what it was designed to do and actually increases the chances that Reducer could be — could get reimbursement in some of those systems. And it’s a standalone procedure versus IVL that drops into existing procedures that are already paid for. So, it’s harder outside of certain discrete markets like Germany and Japan and the US. It’s harder to get an incremental payment in those systems because they’re kind of not structured to pay more per device, whereas a small subset of countries do pay differentially based on the way they code for different device utilization.
Patrick Wood: Totally get it. Thanks so much for taking the questions.
Doug Godshall: You’re welcome.
Operator: Our next question comes from the line of Travis Steed with Bank of America. Please proceed with your question.
Travis Steed: Hey thanks for taking the question and welcome Renee. Doug, maybe a little bit more color on what modest peripheral growth means. Is that still in the 10% to 15% range? Or is it more low single-digits? And is that modest growth every quarter of the year?
Doug Godshall: More modest early. So, low, we think probably low singles for the first half of the year, stepping up to probably low doubles to teens in the back half of the year.
Travis Steed: Okay, helpful. And then in Q1, or sorry, just like in January and February so far. Anything to call out on trends in coronary and peripheral. And I’m curious if the total revenue for Q1 still picking up sequentially a little bit?
Doug Godshall: Yes, on the latter, up a bit sequentially. It was a strong fourth quarter, obviously, we were pleased with the first quarter. We’re — we’re relieved not surprised but encouraged that the contagion fear was not realized. We weren’t afraid of contagion from Aetna, but I know a lot of folks who are probably listening to this call we were a little worried that it was going to be multiple payers we’re going to do what Aetna was doing, and we certainly aren’t seeing that. I’d say procedure volumes appear sound. We’re not, we’re pleased with what we’re hearing from the field.
Travis Steed: Okay, great. Thanks a lot for the questions.
Operator: Our next question comes from the line of Larry Biegelsen with Wells Fargo. Please proceed with your question.
Larry Biegelsen: Good afternoon. Thanks for taking the question. Starting out in the US, US coronary accelerated in Q4. How much do you think the new DRGs are helping already? And on peripheral, sales were flattish sequentially. Aetna is only 10% to 12% of covered lives, I believe. US peripheral was a growth driver for you. So, help us understand how Aetna has had so much of an impact? And I had one follow-up.
Doug Godshall: Yes. We — Aetna was the phenomenon that — was the real change that we noted after the sort of mid — it really took place in September, so end of Q3. carried through into Q4. And when we first, when we did our call last year, I don’t know that we described the underlying sort of slowness of procedures that we were seeing in the third quarter into the fourth quarter for peripheral. So, it would have been — we would have been a little soft on peripheral and then you compounded that with Aetna. I’d say, on balance, peripheral procedures appear to be somewhat less off, but it’s, so I think we feel more bullish about growth, particularly as we turn focus back to peripheral. Right now, we’re for a good reason, with two reimbursement changes and new product launch.
We really want to maximize on our coronary opportunity. And then when we have three product launches in a row and peripheral we’ll be spending a lot of time on peripheral. So, we’re anticipating peripheral will contribute much more nicely to growth end of 2024 into 2025 and high hopes for JAVELIN to be a major contributor to that end as well. So, we’re — you’re not wrong. Aetna is a 10% to 20% player on the — in the matrix of all the private payers. So, it wasn’t just an Aetna phenomenon. But Aetna, clearly, was a meaningful, had a meaningful impact, but it wasn’t the entirety of the impact on the peripheral volume in the back end of last year.
Larry Biegelsen: And Doug, sorry, the first part of the question was the acceleration in US coronary was this, the strength in the quarter came from US coronary? Have you started to see an impact from the new DRGs already? And I’ll ask my follow-up, Doug. There’s a late breaker at ACC on Neovasc, this orbit of cosmic. How is it different from C2? And is there any read through from that trial to what we might see in C2? Thank you.
Doug Godshall: It’s really hard to well, generally, as we say, consistently on reimbursement because it’s what we’ve observed. It’s a dimmer switch on and off switch. So, it has an effect gradually over time. And we launched C2+ and we got the uplift simultaneously. It certainly doesn’t, it did not hurt at all. It’s — it will always be impossible to disaggregate new product launch and reimbursement that happened simultaneously, and it’s now going to be even harder because now we’ve got the CPT goods.
Isaac Zacharias: Yes, I’ll just pile on to that, Larry. What we talked about in the past what the inpatient, I think especially the inpatient uplift in the DRG, what it does ultimately is as the hospitals see the income coming in. Helps the cath lab get relaxed. And so the cath lab then puts less pressure on physicians to moderate their use. They can — physicians then feel like they use IVL when it’s appropriate and they’re not getting pushback from cath lab administrators. And that takes. I was at an account earlier this week in Santa Cruz, and that was the input from them. They just don’t — they’re not getting pushed back from the administration anymore.
Doug Godshall: And on Orbit at Cosmic, it’s, we certainly are delighted to see multiple data sets on, for Reducer at ACC that’s encouraging. We don’t know the results from that study. It’s small, 50-ish patients, so it’s not going to be powered to make any conclusions about it. They use MRI as an endpoint. So, really unclear if that’s a, so I see that as a feasibility of that tool versus something that’s going to be just positive about the Reducer. I won’t be surprised if you see that patients’ symptoms are better because that’s what we see consistently in the various studies that have been done on Reducer and what we see anecdotally from the — all the users in Europe. Whether you really learn anything that is a read-through to C2 because we don’t use MRI as an endpoint in C2.
So, I don’t know that that’s going to really be informative on potential outcome of the C2. If the patients feel better in the treatment arm, that bodes well for C2, I guess, could be the one takeaway.
Larry Biegelsen: Got it. Thank you.
Operator: Our next question comes from the line of Michael Polark with Wolfe Research. Please proceed with your question.
Michael Polark: Good afternoon. Thank you. I want to ask on the outpatient coronary reimbursement topic with an eye towards the map to 5194. Kind of two-parter the event path from here and then a question on coding. So, is this event pass simply we wake up in July, we see the proposal and we see what we see? Or do you have an opportunity to engage with CMS here through the spring, give you a better feel for how they’re looking at this? And the second piece is on coding. I think we’re operating under the assumption this winds up getting solved with the complexity adjustment using the new CPT code that was in effect Jan 1, 2024. Is that correct? Or is there potentially another to-be-determined coating solution here?
Doug Godshall: It would be a waste if I try to answer this one, Rob, sitting right next to me, so I’ll let Rob take this one.
