The world keeps on spinning. You can't stop it if you try to. This time it's different. May not be on. Hold on a second. All right, that's better. Good afternoon, everybody. Welcome to the Edwards Lifesciences 2022 Investor Conference. I'm Mark Wilterding, Senior Vice President of Investor Relations and the Treasurer at Edwards. On behalf of everyone here from the company, we're really glad you could make it. Thank you for taking time out to spend with us here today. I've got a couple housekeeping items I wanted to mention up front and get out of the way. One, we issued a couple press releases this morning, to the extent you haven't seen them, I would urge you to take a look. They walk through the succession plan that we announced, as well as some of the key messages you'll hear out of today's event. Secondly, for those of you who aren't here in the room today, the slides are available on our website at ir.edwards.com. You're able to access the entirety of the book. You can follow along online, and I think you'll find that helpful. The third point I'd want to mention is that as you look at the agenda, you'll see that we've allotted some time for Q&A. We'll have the management team up on stage together for about an hour. When we get into that portion of the presentation, please just raise your hand. We'll call on you, limit your questions to 1, and we'll try to get to as many as possible in the hour that we have. If you wouldn't mind advancing, I don't have a clicker. I apologize. I've got 2 quick slides I want to run by you. One is the forward-looking statements. We'll be making some forward-looking statements as we typically do. Excuse me. Thank you. Familiarize yourself with this slide. They're available on our website as well as on file with the SEC. We'll also be referring to non-GAAP financials. We think this helps make year-over-year comparisons a little bit easier. Again, the reconciliations from GAAP to non-GAAP available on our website to the extent you need them. I love working at Edwards. In fact, one of the best parts about working at Edwards, I think, is our patient-focused culture. It means a lot to me. I know it means a lot to the team. I've talked to a lot of you about it. I think the best way to really show it is by way of a video. We're gonna run this, and then we'll get the show started. Thank you. The patient experience gives the employees here at Edwards the opportunity to engage with patients one-on-one. It is our flagship listening event, which is so important to our employees and the future of our company. We have our critical care patient. It's Marissa Blake from Las Vegas, Nevada. It's the amazing David Cooley. I'm not just a patient. I am a recognizable, known person to these people. It seems like I have a big family here that I didn't even know about. What happens here when patients come to campus is magical. This is Cynthia Gonzalez. Patients get to come and actually spend time and meet the people that designed their products and built their products that have impacted their lives. You guys are wonderful. They said I would meet the person. They said, like, one person who made my valve, but I'm meeting a whole crowd. The patient experience allows us to really learn from them to better improve their care overall. I kind of retreated from my family, took a step back, because I didn't think I was gonna be here. I've been given a second chance, and I'm not gonna throw it away. Yeah. Let's do this. Yeah. I played volleyball at Ohio State, so this valve allowed me to keep living out my dreams. Very thankful for all of you. I was speechless. It kind of emboldened me in the work that we're doing. It brings to life really these projects that we tinker with on a day-to-day basis will eventually serve people in a meaningful way. The juice that I get from the patient experience and from today is just keep going because someone out there is depending on you. All of this lets us know that it's worth it, but also motivates us to push the envelope further, wanting to get there faster. Now, when I wake up, I'm gonna have that spark in me that each of these projects that I'm working on is going to help patients in the end. I can't wait until tomorrow. Can't wait to do more good work for future patients. Welcome, everybody. I'll share my thoughts and so happy that you're with us. It gives you a nice little view into our company and how we feel about things. I hope you enjoy this environment here. Being in this iconic location is something that's kinda fun and reminds us of the importance of what we do and what a great history that we all get a chance to participate in. I'm gonna get in, I'll talk about the company and also spend a little bit of time in a few minutes talking about the succession changes we're going through. Stay tuned for that. We always start with our Credo. It kinda defines who we are, kind of the soul of the company, if we will. It's, it highlights the fact that what we do is serious. If when we do it well, we're a trusted partner. It's a team sport. We can't change healthcare by ourselves, but we can be an important part of it, and we need to be one that others can count on along the way. We work with a lot of constituencies. We were born in this multi-stakeholder model and sort of feel like we live that every day, so that's really not new to us. We're also reminded by the close why we're here. It's to serve patients. We know when we serve patients, that the rest of it kinda takes care of itself. We take this seriously. We ask our employees to live this every day, and I'm so proud of our leadership team that they take it so seriously. Our company continues to evolve. I don't know that you measure the company by what the sales are or the profits are, but there's lots of ways of measuring it. Just transcatheter procedures themselves, over 800,000 so far. We're not far from closing in on 1 million procedures there. Very proud to say almost everything we sell, over 95%, are in number 1 global positions. We have a really strong global supply chain that has not let down the patients that we serve. We're very global in nature, and that team has been so dedicated, and we have plans to make it even more robust, and we invest on that on a very strategic basis routinely. A lot of smart people in the company. Just over 2,000 engineers alone, and you know the kind of investment that we make in Research and Development because innovation is one of our pillars. We also have a company where our employees are really engaged in charitable efforts. You know, we have this aspiration that everybody will do something. Over 85% of our employees reported doing something charitable in the last year. So we're up to 17,000 employees at this point. Although we have a lot of real deep experience with the company, we have a lot of new people as well. And 60% of our employees are Millennials and Gen Z. So we've got this cool combination of the deep experience, et cetera, but also the bright new minds and the bright new ideas. And I love the dynamic that's associated with that Our aspirations talk about who we want to be when we grow up, and we're constantly striving to do that. It really starts with this idea that we want to transform lives with breakthrough medical technologies. That's easy to say, but boy, when we get that right, we just create incredible value. It's super hard, and it takes a long time, but we're good with that, right? That's who we are. That's what we try to do. When you think about what Edwards does for a living, serious things like heart valves, like critical care medicine, there's not a lot of room for mistakes. For us to be a truly trusted partner where people can count on our quality, count on our integrity, count on the fact that we're always gonna try and tell the truth and be their partner is something that's so important. We have a group of employees that we try and create an environment where they really feel like they belong and they can grow to be their best. We try and invest in that in a real way to have this inclusive culture where people really enjoy their work and value their work. We also know that we operate in a lot of different communities, and we wanna be known as a company that gives back to its communities. Not a taker, but somewhere where you'd say, "Boy, we're glad Edwards is in our community. They make us stronger." We really approach it with that kind of an attitude. Finally, when we get all those other things right, I don't think we can help but create shareholder value. That's the way we approach it is, you know, from the top, to create value through the way that we behave. Our strategy is different than other companies' strategy. Often companies try and grow by diversification and so forth. That's really not who we are. At our core, we're committed to just continue to innovate. As great as healthcare is today, and particularly for the patients that we serve, we feel like it could be so much better. We are committed to innovation, just constantly driving the state-of-the-art to a better place. Now, we know that the practice of medicine doesn't change very easily or very quickly. You'd better back it up with big-time evidence. That means the things that we embark on are gonna take time, right? We know that when we go in and start a journey, we might be at it for a decade or more before it really realizes its potential. We're good with that, right? It speaks to that innovation process. Certainly, there's risk associated with it because as good as we are, everything we start doesn't necessarily work out the way we thought. Sometimes the things we start work out even better than how we thought. It's innovation at its essence. We also are believers in leadership. We don't mind going first. Actually, it's lower risk to go second or third, that's not the way we look at it. We say those that go first, they learn faster than anybody else, and they're also at the table with the other pioneers in actually shaping the innovation in terms of how that'll work, and that's the chair that we wanna be in. Finally, the way that we manage the risk associated with leadership and the risk associated with innovation is by staying focused. That idea that we're just gonna stay maniacally focused on structural heart disease and critical care medicine and not crowded with other things that are the shiny new object, that is powerful. We think there's greatly underserved populations right there, and that we don't need to go to other places to have a lot of growth and a very bright future. That focus really, I think, distinguishes us and allows us to really know this group of patients maybe better than anybody else, and to continually find ways of giving them better answers than they've ever had before. When we get that right, we create a lot of value. If you're sort of reflecting on how has it worked out so far, not so bad. Not so bad. We know that the patient demand is tremendous, so we're gonna talk more about that. There's just These patients are underserved and much of it is because historically there were no good answers for these patients. If we do our job right and we create innovations, there's gonna be answers in the future like there never have before. We constantly strive for this triple win, and this is just a simple idea. Just think, if we can extend life, improve the quality of life, and save the system money, ding, ding, right? That's what success looks like. That's what we continuously try to do, is to get those triple wins. As I mentioned, these are long-term efforts, right? This isn't about... I know I kind of smile. People are always wondering, "Well, what's next quarter gonna look like or next year?" We're in it for the long run, and that's what it really takes. The success that we're enjoying right now are often seeds that were planted 5 years ago, 10 years ago, We know that the seeds that we're planting today are the ones that are gonna bear fruit in the future. It's just the way that life works for us. We're gonna go deeper on all these subjects, I won't go deep on any of them. We, you know, had a challenging environment in 2022, we did quite a bit of growing and quite a bit of investing in the future during 2022. We expect 2023 to be a strong year of growth, as well as accomplishing some really important milestones along the way. We think there's a very large addressable market, we're happy to get deeper with you on that one. I'm so proud of this team. We got just a highly strategic and experienced management team that enables all this to happen. We'll get deeper on all that. 22 was the year where we actually had quite a few accomplishments, and we'll go deeper on that and I won't go through all of it. Our teams really delivered. Even during a challenging environment, they made sure that we continued to meet our commitments and advance some of these long-term efforts that make a difference. Even though we fell short of what we wanted to from a sales perspective, we still had some pretty nice growth that we enjoyed during the year, but we never lost sight of why we're here and our strategic aims in the long run. The guidance itself is unchanged for the rest of the year, so we'll talk about that more, and Scott will go much deeper in his section. Bigger picture, you guys all know this that follow the company. We feel like COVID really triggered some downstream staffing challenges, right? Probably was born during the age of COVID, but it ended up having a big impact on our customers. They just have had a tough time having all the staff in place that they need to have in place. There's plenty written about this. We have not taken that lightly. That's really important. We have prioritized a number of initiatives to go exactly at this point, and we'll be talking about those during the course of the conference. It's multifaceted. The thing that I'm encouraged by, those folks that are running hospital systems or governments that are in big healthcare systems, they're equally motivated to solve these problems. In a fee-for-service world, the way that they get paid is to do procedures, and they wanna do procedures. Getting this squared away is something they're very committed to. I get a chance to speak with a number of them, and they're highly committed. We believe that they're gonna make progress on it, and we're gonna try and be good partners and do our part in helping them be successful. 23 is gonna be a year which we believe is gonna have strong growth and a lot of investment again in our future. We're gonna go through this business by business, and you'll get a chance to hear from each one with a fair amount of detail about the big milestones that we expect to accomplish during the year at the same time that it was a year of growth. When you think about it, 2023, we don't know how that's gonna shape up for the world. Are we gonna have a recession, or just come close to it and so forth? We think that we're gonna be able to have some pretty solid growth during the year regardless of what that environment looks like. Let me just speak to the long term. We continue to believe we have an incredible opportunity and that patients out there are dramatically underserved and that our, our opportunity will essentially double from where we are right now between now and 2028. There's a $20 billion market opportunity for us to go after. That's what really motivates us to make a difference for these patients. We'll get a little deeper on all that. Actually, beyond 2028, and you know we talk about very long time frames, there's some big movers that won't even be in place. Things like treating moderate aortic stenosis patients aren't even in those numbers, and that's a very large opportunity. We think actually replacing valves in the mitral and tricuspid position will still be small by 2028, and the bigger opportunities are gonna be well beyond, and that's a very large one in itself. We also believe that there is gonna be the opportunity for Edwards to use our kind of expertise to use interventional therapies to treat heart failure, the number one expense item and number one killer in the world. We're excited about things on a long-term basis and continually think about that as we make our investments. Excuse me. Our agenda, you may have seen, you're going to hear from a number of our leaders. You know we've got some management changes going on where people are going to change roles. Our leaders are going to present their current roles, not their future roles. You're going to see everybody doing the jobs that they have been doing and doing so well. Just a little bit of a preview for that. The people that are going to take new roles on actually take those on at January 1st. Speaking of that, this is probably a good place for me to just talk about our team. I'm very proud of our executive leadership team. These people, each individually, are very experienced, very committed, and experts at what they do. More than that, they're a real team. We really do help each other. We really do work together as a team, and it allows us to be successful. You know that I announced that I'm gonna be making a transition, moving from the role that I'm in today as CEO and Chairman, that next May that I'll transition to, hopefully the Chairman's role. I'll stand for election for that. That Bernard Zovighian will be the new CEO of Edwards Lifesciences starting in May. He'll be in the President's role, and he and I will work together very closely over the next six months to ensure a smooth transition. This is not something that's come, you know, very quickly or without a lot of thought. Our Board takes very seriously the succession process. We've talked about it a lot. We routinely go through and have a number of successors for all the top jobs, including the one that I was in, and had a very rigorous process, which included people both inside and outside the company. I'm really pleased to announce Bernard, and I think the company's gonna be in very good hands with him. Those of you that don't know him, I look forward to you getting a chance to know him even better because he's got an incredible track record of success. He's been leading our TMTT business, which is all the right stuff in creating something that's very exciting, and taking a dream and turning it into reality, which is really best of Edwards. We also have new responsibilities for Larry Wood. You guys know Larry. Larry has been this incredible leader that has helped create the transcatheter aortic valve replacement business from scratch. I'm talking about from 0. Dedicated 20 years of his career to create probably one of the greatest innovations in cardiovascular medicine, if not more broadly, than any of us has seen. We're so proud of his leadership. He's gonna take on expanded responsibility, also have responsibility for our surgical structural heart business and some other responsibilities inside the company. We're very pleased to be able to expand his responsibility. When Bernard moves into his new role, Daveen Chopra, who's been running our surgical structural heart business, is gonna move into the TMTT job, running transcatheter tricuspid and mitral therapies. Daveen has a great track record. He's very passionate guy, very smart guy, and is very well prepared for this responsibility moving ahead. I'm proud of this team, and one of the things that gives me a lot of comfort to sort of go on to the next stage is to know that we have this incredible team that really leads the company. We are a tight team, and anybody that sort of thinks that it's all around one person has never seen the way that Edwards really works. You'll get a chance to hear more about this as time goes on. With that, I'd like to introduce Larry Wood to talk about transcatheter heart valve replacements. Matter of fact, let's roll the video. It is our responsibility to make sure that we are not under-diagnosing and under-treating aortic stenosis because we have an excellent solution for these patients, and it makes a real impact in their survival and their quality of life. I'm 82 years old. I'm into hiking and guiding and stair climbing. I didn't want open heart surgery because I'd rather get back on the trail a lot quicker. TAVR made all the difference for me. Well, thanks, Mike. It's always great to see everybody, and it's always such an honor and privilege to talk about our transcatheter valve business. I know there's been a lot of challenges of late, but we see those really as transient. The fundamentals of our transcatheter valve business remain incredibly strong. I think there's 3 pillars to our strategy that we really focus on: Increasing therapy adoption, Expanding indications, and Delivering a strong portfolio that's highly differentiated. Now, if we look back at the last 6 years, you know, we know the last couple of quarters have been a bit tough, but if you look at the dotted line, we can see that the growth of TAVR has been really, really impressive, and that line represents about a 14% CAGR. We've never just been linear and stayed on that line. I remember back in 2016, many of you wrote notes talking about the demise of TAVR, and many of you wrote those same notes in 2018. We always saw the return, and we always saw the acceleration again because the fundamentals are very strong and there's a huge patient population, as Mike said, that's underserved. One of the questions that we've gotten a lot is: Why does TAVR seem to be disproportionately affected by staffing issues compared to other procedures? One of the things that happens if a patient with aortic stenosis or any valve disease is referred to surgery, they can be immediately scheduled for surgery because most of the assessments are done actually intraprocedurally. Things like valve sizing, the surgeon does during the procedure. But for TAVR patients, there's additional steps that they have to go through. They often get a confirmatory echo. They need a CT scan so that we can assess their sizing and access. They often average to be screened for coronary disease. At the end, they have to be seen by a surgeon and a cardiologist and they go through a shared decision-making process. There's just more steps that require more resources to process a TAVR patient through the, through the pre-procedure aspects of it. We've done a tremendous amount to try to optimize the procedure. We've reduced length of stay. Many hospitals in the country now are down to 1- day length of stay. The procedure time has come down from more than 3 hours to about 1 hour in most institutions. There's a lot of things that we can share on best practices to reduce the number of people in the room and reduce that administrative burden. There's a lot of hospitals that are optimized, but there's many, many, many more hospitals that still are in that early phase of optimizing their staffing and optimizing their procedure. One of the things that we do to try to help the staffing challenges is we provide a lot of training and a lot of education. In an average year, we would train or educate about 200 valve clinic coordinators. Valve clinic coordinators are sort of the point person for the structural heart program. They're sort of the guide that moves the patient through the process and makes sure they have all of their tests scheduled and tests performed, and that they see all the appropriate doctors along the journey. In a typical year, we run programs that touch about 200 valve clinic coordinators. This year we're gonna do well over 800. We might actually get close to 900, which just reflects, you know, I only have 850 hospitals or so in the country. It tells you how much staffing churn there has been, and it's critical that we get the valve clinic coordinators up to speed. These educational programs are largely peer-to-peer, where we match up experienced valve clinic coordinators with new people to show them what it takes to be a valve clinic coordinator. Then we run advanced programs for centers that want to optimize their care and wanna take on things like Benchmark and other things. We also continue to train fellows, and we train additional heart teams because as hospitals reach their capacity limit, they oftentimes have to get a second TAVR team up and running. We provide all the training for that, and you can see the numbers here. We do a lot of training to try to address some of these staffing challenges. Last year we talked a lot about our portfolio. These are things that really impact us near term and long term. We talked about getting Alterra approved for pulmonic patients. I'm very happy to report that did happen on time, on schedule. There was a product that we didn't talk about a year ago, which is our SAPIEN 3 Ultra with the RESILIA tissue technology. We're very excited. That's approved now in the U.S. as well as Japan. We have our SAPIEN X4 system, which is now in a clinical trial. We have our EARLY TAVR trial, which we completed the enrollment. All those people are on their journey to the endpoint. We have the PROGRESS Trial, which is actively enrolling for moderate aortic stenosis patients. Tremendous progress on both near-term and long-term activities. Increasing therapy adoption is one of our prime strategies that we focus on a lot. We used to talk to surgeons, the people that actually provided the care. They told us that there was no undertreatment, that everybody that was referred to them got therapy. There was really very few inoperable patients, if any, and there was no undertreatment of the disease. As we've gone really deep on this, we've learned that back pre-TAVR, as evidence of the undertreatment, you can see during this period of time, the number of people getting the aortic valve replaced has virtually doubled, which speaks to the undertreatment. Even with that, we've only moved to about 12 out of 100 people. Even when you look forward and you look at a lot of our projections, that number goes to, like, 16-18. We never get up into those really high treatment ranges that patients probably deserve. Undertreatment is also a much bigger problem in the elderly. We see as patients get older, the utilization of valve replacement goes down as a percentage significantly. We also see that the time to treatment, from diagnosis to treatment, goes up significantly as people get older, and this really speaks to an issue around ageism. Rather than just hear about this from me, we've got a couple of our key clinicians here, and they're gonna talk about their own experience with this and their own practice with this. Please cue the video. TAVR has been transformative in giving us an option to treat patients who previously did not have a treatment option. We're becoming much more aware of the fact that there's a large segment of patients who have a guideline indication for valve replacement, severe symptomatic aortic stenosis, who are not getting treatment with valve replacement. When I first heard and saw data in the literature that aortic valve replacement was being underutilized, honestly, I didn't believe it. I went and looked at our own data. We ended up finding that despite the fact that TAVR had been introduced, aortic valve replacement remained severely undertreated. Our own data has actually demonstrated that half of patients with symptomatic severe aortic stenosis do not get treated. That's across the board. Imagine you had a cancer with a high mortality rate. You had an effective therapy, but only 50% of patients were treated with it. There would be a public outcry. Age was one of the biggest contributors to AVR underutilization. In patients who are over the age of 80, only 25% or so receive an aortic valve replacement, which is absolutely a dismal number given the fact that we know that if you don't treat symptomatic severe aortic stenosis, only about 50% of patients will survive 1-2 years. It really is a medically urgent condition that warrants urgent treatment. On average, it can take over 6 months for a patient with aortic stenosis who's over the age of 80 to actually get an aortic valve replacement. The AHA created quality of care of patients with aortic stenosis has been on the time from treatment with aortic valve replacement and afterward. We are attempting now, through this initiative, to look upstream to what happens from the time period of diagnosis by echocardiogram through referral to timely treatment of aortic valve replacement. I think we will definitely be able to address these shortcomings, and that the community as a whole will rally behind treating patients more fully. The goal is to ensure that all patients with severe symptomatic aortic stenosis who warrant and desire aortic valve replacement are treated in a timely manner with complications minimized. Once we do that, I think we will definitely have the ability to improve our patients' lives, to make them live longer, and to treat more of them, and to keep them healthy. I think one of the most sobering things from that video is at an elite cardiac program such as Mass General, half of the patients who have a guideline indication for valve replacement go without therapy. If that's the situation at Mass General, I can almost assure you it's worse probably most other places. It just really speaks to the undertreatment. You wanna dig into the why. Why are people reluctant to treat eighty-year-olds? The first question may be, hey, maybe because their advanced age, maybe we can't deliver good outcomes in eighty-year-olds with things like TAVR. We look at the data, and basically, the outcomes we can deliver in eighty-year-olds are indistinguishable from seventy-year-olds. We know we can deliver spectacular outcomes from all of the clinical measurements that we have. Maybe you say, "Yeah, that's fine, but maybe these patients aren't going to get the quality of life benefits because they have so many comorbidities." We went and dug into it. You look at very sophisticated quality of life measures like KCCQ, and again, the results are indistinguishable. You look at NYHA score, they're virtually the same. Clearly, these patients get the same quality of life benefits and survival benefits. Maybe you say, "Okay, but if a patient's 80, their life expectancy is so short, so why should we bother putting them through this procedure and utilizing this technology?" Well, the reality is if you reach the age of 80, chances are you're going to live another 9 years. Not only do they need an intervention, they need a high-quality intervention. They need a durable intervention. We know that we can do these things, but part of it is just our perception and bias of what an 80-year-old is today. You know, this is Harrison Ford. He's 80, and he just recently filmed a new Indiana Jones movie. You know, if Indiana Jones got aortic stenosis, he deserves a TAVR. I think that's just something that we have to think about, and we have to change the way we approach what it means to be 80 now in terms of life expectancy and in terms of ability to improve their, not only their survival, but also their quality of life. What are we doing about it? Well, we have a number of work streams actively moving on this. We have television commercials we run in the United States as well as outside the United States to try to raise awareness, and not just awareness with patients, but also their caregivers and in some cases their physicians. We have resources online to help patients find a TAVR center or educate them about the therapies that are available to them. We partner with Healthgrades to make sure that they can actually contact a doctor on the heart team rather than have to go through a more complicated referral pathway. We've also, the issue of ageism is probably one of our newer findings. We sort of, in our journey, you know, we started with inoperable and high-risk patients, and a lot of our focus has been on the lower risk and younger patients. When we dig into the data, one of the things we discovered is it's still really the older patients that are most often denied care or move slowly through the system. We've really tried to partner with key clinicians to attack this issue of ageism. Even at the most recent TCT meeting, there were symposia on this. There were key thought leaders who were speaking about it and really trying to educate people on the data and the projections and the life expectancy of elderly populations to try to change this curve. The other thing is, the AHA has started a quality initiative to really try to address the issues with the treatment for patients with aortic stenosis. This is a program that we support, but what it's really focused on is what happens to a patient before treatment, their time to therapy. We feel that or AHA feels actually that most patients from time of diagnosis to treatment should be 90 days or less. That actually rarely happens today in clinical practice. They're working with key centers. They're working to understand the data. The goal of this is really to create guidelines and quality metrics from the time of diagnosis, rather than just focusing on the clinical outcomes of the patient receiving treatment. The AHA is the perfect entity to lead this charge because they have demonstrated expertise. They led the Door to Balloon initiative, which pretty much revolutionized how patients with heart attacks were treated. They've also done incredible work to address stroke, to try to improve care. A lot of it is based on timely identification and timely treatment. We're very excited about this initiative. There's no silver bullet here. There's no one thing. We have so many different work streams targeted in so many different areas to try to address hospital systems, to try to reach patients directly and to try to focus on the HCPs. It's gonna take a combination of all these things, but we continue to invest heavily in this, and we're excited with the progress we're making. Expanding indications is also another key pillar of our strategy. We've talked about the undertreatment of patients with severe aortic stenosis, and part of the challenge there is right now, the guidelines often relate to symptoms as being the trigger point for patients being treated. Because this is a disease of the elderly, and the symptoms are often shortness of breath or lightheadedness or exercise tolerance, oftentimes those just get confused with the aging process and not attributed to the valvular disease. We don't think there's a lot of logic in waiting for the patient to actually have symptoms rather than just treating the disease when it presents. We don't really treat other diseases that way. If we could get people and prove that treating them when they're diagnosed with the disease is the trip point rather than symptoms, it would really revolutionize how patients move through the system with aortic stenosis. We have the EARLY TAVR trial, which is completely enrolled. It has a 2-year endpoint, and we're just waiting for those patients to meet their endpoint, so we can open up this data. It's going to tell us for the first time ever definitively what% of patients are truly asymptomatic when subjected to a protocolized stress test and how fast do they progress and is there dangers in waiting to treat these patients? We'll be able to answer these questions through a high-quality randomized trial, and that evidence can help us define how these patients should be treated. Beyond severe aortic stenosis in this issue of symptoms, we have moderate disease. Again, most diseases, you try to treat them as soon as possible when they're initially identified. With aortic stenosis, patients with moderate aortic stenosis are just told to wait, and they're told to wait until it gets severe. Several studies have shown that irreversible damage is being done to the heart during this period of time. We believe treating these patients earlier could have significant benefits for these patients. We have the PROGRESS Trial. Again, another very rigorous randomized trial, large sample size, where patients are going to either be randomized to getting therapy or clinical surveillance. The primary endpoint, very similar to EARLY TAVR. Again, it has a 2-year endpoint, and it has 10-year long-term follow-up. This is the sort of evidence that we're going to have to generate if we want to change the patient journey and change how patients move through the system with aortic stenosis. One of the reasons we're confident that this trial is gonna show to be successful are recent studies that have come out that have shown that patients with moderate disease have almost the same trajectory as patients with severe disease. Maybe the trip point for treatment should be moderate rather than waiting until it's severe. If this trial is successful, it basically doubles the size of the TAVR opportunity because for every severe patient, there's 2 moderate patients. The last thing is delivering on a really strong portfolio. We've enjoyed a highly differentiated portfolio during this entire TAVR journey. You can see we've had a number of meaningful innovations over time. Our latest innovation is SAPIEN 3 Ultra with the RESILIA tissue technology. We have SAPIEN X4 in the ALLIANCE trial, and then we have future platforms beyond that. We're just never gonna stop innovating, and we're incredibly focused on making sure we always stay ahead, and we continue to deliver critical innovations for patients. Now, Ultra RESILIA, this is the first time that any transcatheter heart valve has had dry tissue. The RESILIA tissue technology is on our leading surgical heart valves. I don't wanna steal his thunder. My good friend, Davee, is gonna talk a lot more about RESILIA during his presentation. Having this on our platform we think is a real game-changer for physicians. And we also added the Ultra skirt to the 29 millimeter, so now we have the full complement of sizes with our Ultra platform. So we're very excited about this. We're excited enough that for the first time in our history, we're actually raising the list price about $1,500. We feel very strongly that this is gonna be developments and innovations that are gonna be valued by our customers, and we're excited about the opportunity. The other platform that we have that's in our clinical trial is our X4. This is really a, a revolutionary platform. One of the major changes to it is we introduce variable sizing. Right now our valves come in 3-millimeter increments, but patients don't. We always have to adapt the patient to our valve size. With SAPIEN X4, we've designed a valve that can operate over a wider size range. If a patient comes in and their annulus is 24.5, we can take a 26-millimeter valve and deploy it to 24.5. We can have a valve that's very personal for that patient. The other thing that we're able to do is we're able to align the commissures. We can align the commissures on the prosthetic valve to the commissures in the native anatomy. Why that's important is for future valve and valve procedures. The demands on a transcatheter heart valve now are much bigger than they were when we started. When we started, it was just about treating aortic stenosis. Now the valve has to be a great valve for fixing the aortic stenosis, but it also has to be a great host for that next intervention. It also has to be a great guest that can go in that host because we're now thinking about lifetime management. How does a patient get 2 or perhaps even 3 procedures staged over the course of their lifetime? That's what we think about when we develop these new platforms, is preparing not only for this procedure but for future procedures. Now, we did pause the enrollment in our ALLIANCE trial. This is completely unrelated to the valve, but we found an opportunity with the delivery system where we think we can really enhance the user experience. We paused it because the bar that we have with our SAPIEN 3 Ultra platform is super high. We need to make sure that if we're gonna bring a platform in to displace SAPIEN 3 Ultra, that it hits all the marks, and it's a 10 on a 10 scale. We just see that there's an opportunity here to really improve and change the physician experience with the platform. We expect to go back into clinical trial next year. It's really critical that we get this platform right, and so we're really excited about it. Again, it's unrelated to the valve. It's unrelated to the delivery of the valve. It just has to do with how we introduce the valve into the body. We're excited to get that trial back underway. Again, you know, we have our transient challenges with staffing and some of the hangover from COVID. Our fundamentals are so strong with the aging population and with the undertreatment of this disease, and we just think there's so many opportunities to reinvigorate the growth and go back to where we were pre-COVID. When we look at the opportunity, we again still see this as being a $10 billion opportunity by 2028, which is very exciting. I think even more exciting is beyond 2028. It's not like 2028 is the end of the journey. We have things like moderate aortic stenosis, the PROGRESS Trial. Those probably don't really contribute before 2028. Those probably come later. We also have further global expansion into emerging markets. Those things are gonna continue to contribute over time, but a lot of those things are gonna happen after the 2028 time period. We see this as having really a long runway to continue to grow very robustly. As we look towards 2023, you know, we have the headwinds with the hospital staffing and COVID uncertainties, but we also have the tailwinds of trying to drive this therapy adoption. We do hear anecdotally that there may be a little bit of a patient backlog that's been growing while some of these staffing problems have occurred. If that's the case, that's also gonna be a patient group that could help us in 2023. We factored all of that into our guidance, and our guidance is 9%-12% growth in 2023, and we're excited to be back in that arena. With that, I'd like to turn it over to my good friend, Bernard. He's always been my good friend, but now he's my really good friend. He's gonna talk about our TMTT opportunity. Thank you very much. Having those innovative minds that Edwards have in managing a very complex disease that many people shy away from is really what makes Edwards seize the moment in managing mitral valve disease. They pay attention for every single details in their clinical trials, that gives you trust in the technology. That gives you trust in the data, that actually gives you trust in the, in the partnership for treating patients. After the procedure, I don't have to worry about shortness of breath because I've got it all back and more. My quality of life is probably 120% better than it ever was. Thanks, Larry. You know, hello, everyone. You know, I'm very pleased, you know, to be here with you today. Over the next, you know, 20 minutes or so, you know, I'm going to share, you know, the progress, meaningful progress we made, you know, the exciting plan we have, you know, toward, you know, achieving our vision of transforming care for so many patient in needs. I will start with the patient need, get into the mitral, then tricuspid, and then a wrap-up. Let me start, you know, with the patient. The patient need. Let me tell you that, you know, what these patients are experiencing is very tough. You know, the mortality for this patient, you know, both, you know, mitral and tricuspid patient is, you know, very high. They have a very tough, you know, quality of life. You know, as a physician, I have, you know, very few options. You know, I can't see the slide here. Sorry. You know, they have, you know, very few options. You know, they have drugs. Most of these patients are treated, you know, medically. We know that, you know, it is, you know, somehow effective, you know, very costly. You know, patient have a lot of rehospitalization, tough on the patient, you know, tough on the healthcare system. When they get an intervention, it is mostly surgery. Very invasive. You know, the recovery is long, you know, for the patients. If you think about, you know what we believe. We believe that transcatheter innovation can change this, can change the adoption. Today, you know, the adoption for both, you know, surgery and transcatheter is about 2%, very low. We believe that with this, you know, transcatheter innovation, the adoption can go to 4%. 4%, you know, in my mind is, you know, is bringing, you know, 2 things. 1, it is realistic, correct? You know, 2%-4%, it is still a, you know, a low number of adoption and we believe, you know, therefore that, you know, there is great growth, you know, beyond 2028. How we are going to do that with a proven strategy, what we have been doing in TAVR, you know, for a long time. Having best innovation, great clinical evidence, being able to support physician, partnering with physician to achieve, you know, great outcome. We believe that, you know, the adoption going from 2% to 4%, you know, the transcatheter segment will basically grow from what it is, $1 billion today, you know, to $5 billion, you know, by 2028. Great opportunity ahead of us in, you know, transforming care, you know, for these many patients. Here I have a technical challenge. I don't see the slides. let me start, you know, with, you know, the mitral sections. In the past, you know, physician have only, you know, one innovation, one TEER device. The clinical evidence were limited and mixed, and many patient were, you know, discharged, you know, from the hospital with only, you know, being able to achieve, you know, moderate MR, which we know today is not sufficient. You know, I am confident that, you know, the new era is starting. You know, if you look at, you know, what we have today, there are 2 devices available. The innovation is, you know, way stronger. You know, many innovation has happened in the last, you know, few years. Clinical evidence also has made, you know, great, you know, advances. The device are easier to use. More operator can learn how to use these devices. Tomorrow, we see this trend continuing with more innovation in TEER and the addition of mitral replacement. More clinical evidence. We are for sure, you know, very excited about today, what's happening, but also, you know, very excited about what lies ahead, you know, for patient and physician. Let me start with, you know, the innovation because, you know, at the end of the day, it is all about having great innovation. We introduced, you know, PASCAL Precision in Europe earlier in the year, in the US earlier in the year, and we are hearing, you know, great feedback, you know, from physician. What we see it is still early. Word of caution, we like, you know, what we see. You know, faster in the procedure, you know, enhanced, you know, patient outcome. We are very committed here, you know, to bring, you know, a number of innovation in the years to come. We are very pleased about, you know, PASCAL Precision today. Let's listen now to, you know, what physician are saying about, you know, PASCAL Precision. Hi, my name is Peter Hughes. I'm 78 years old. My wife and I live a quiet life in the countryside. It gives us excellent relaxation. 18 months ago, I noticed that my energy level was diminishing. I also had some difficulty breathing, and my sleep pattern deteriorated. Peter had really quite debilitating symptoms. His mitral regurgitation was becoming more severe. Open heart surgery was definitely not an option. The PASCAL device gives me the opportunity to treat the full range of mitral valve anatomy safely with a very reliable result. Peter's procedure went very smoothly. I was in the morning, out in the evening, and in two days' time, I was feeling the benefit of having the mitral valve procedure. It has allowed me to be far more active. Mowing the lawn, going to the bowling club, and walking with friends. To be able to offer a patient like Peter a procedure like this with no further surgery, with a very short inpatient stay, is a fantastic advance in the treatment of severe mitral regurgitation. With PASCAL Precision, there's been a big step forward in the ease of use of the device, which I'm sure will lead to more adoption in more centers. It has made a significant difference to my quality of life. It is great to see, you know, this kind of impact that we are making on patients and what, you know, PASCAL Precision is bringing, you know, to physician. Now let's look at, you know, the clinical evidence on TEER, again, you know, in a more, you know, deep, you know, manner here. In the past, in the last, you know, few years, you know, at discharge, half of the patient were left with mild MR, which we know today is not sufficient. What we have seen, you know, lately is that, you know, the latest evidence, like, you know, the CLASP IID randomized, you know, study, but others also, is that, you know, today the new reality is that, you know, physician can achieve 80%+ of a patient being discharged with mild MR. We know that this is a, having a big impact on patient mortality, patient, you know, quality of life. We are very excited about that. You know, we see that as being the new era, you know, for, you know, TEER for this, you know, mitral patient. You know, we have seen also, and you have seen that at TCT, even though it is very early, even though it was, you know, the first, you know, cohort of patients that were, you know, presented at, you know, at TCT, that, you know, PASCAL at 6 months seems, you know, very durable. You know, we feel, you know, very good about that. You know, obviously, you know, we are going to follow, you know, these patients out to 5 years. You know, we want to bring, you know, world-class evidence. Next year, what you are going to see is the full cohort of patients from CLASP IID at one year. Important, you know, data set that we are going to share with the medical community next year. Let's, you know, look at, you know, listen from, you know, the CLASP IID PI and what they believe, you know, CLASP IID is going to do to patients, to physicians, and to, you know, the referring community. The first randomized trial in a TEER therapy happened more than a decade ago. We now have even more data about the feasibility, the safety, and the efficacy of edge-to-edge repair technology for degenerative MR patients. CLASP IID was conducted in a way that sets standards. When a trial is rigorous, it is much more likely to have an impact on the way we practice cardiology. In both arms, nearly 98% had 2+ or less MR. In the PASCAL arm, nearly 84% had 1+ or 0 residual MR. There are several unique design features of the PASCAL device. Its hollow nitinol construction, its smooth, rounded surfaces, its ability to flex with the heart, that all along have given us a lot of encouragement that this device may be really offering something quite important to our patients with mitral valve disease. I think that's borne out by these trial results. The CLASP IID data and the results thus far are huge. Now we can point to something and say, "You know what? Within six months, we've got some pretty remarkable results. I think this directly will translate into the confidence level of our referring physicians. I think it will increase the patient flow that come into multidisciplinary teams to evaluate patients for TEER therapy. Class IID is a big deal for patients, so I think it's gonna be very impactful. You know, we are, you know, we are confident that, you know, we have the right platform today. It is a leading, you know, platform. Confident that, you know, CLASP IID is bringing, you know, meaningful evidence, you know, for physicians to treat, you know, their patients. Now let's go into, you know, what are we going to do in the U.S.? We got, you know, slightly, you know, early approval in the U.S. You know, we were, you know, very pleased, you know, with that, and we launched at TCT. We are started building a team, dedicated TMTT team, about a year ago. We hire, you know, people, train people, you know, scale, you know, this organization, you know, for them, you know, to deploy our high-touch model. What do we mean when we say high-touch model? We mean, you know, we want them to train physicians. Even though, you know, PASCAL is a TEER device, it is a very different device than the current, you know, former device in the marketplace. We want our high-touch team to support physicians screen patients. We want, you know, them to be in every case to be sure that every patient is well taken care of. Throughout 2023, you know, what you can expect is us expanding our presence in large experience center in the U.S., further hiring and scaling our, you know, high-touch team, and delivering, you know, exceptional, you know, results for every patients. We are implementing a price premium, you know, strategy like, you know, we were doing and like we are doing in Europe. It is a modest, you know, price premium. Nevertheless, a price premium, which is, in our mind, aligned with this, you know, platform and what we bring, you know, to the value we bring to the healthcare system, to patients and physicians. We are very excited about, you know, where we are with TEER. You know, it is important. It is an important segment. We have the right technology. Evidence is coming and strong. At the same time, we know that, you know, this patient population is very complex, you know, very diverse, and we need to complement TEER with a mitral replacement therapy. You know, re-replacement, you know, can eliminate MR in a consistent manner, and physician will be able to treat even more patients. We also know that not all transcatheter replacement are the same. We learned that, you know, from TAVR. You know, transfemoral is less invasive than transapical. Transapical is a surgical platform. With transfemoral, what do you get? You know, less bleeding, less complication, you know, faster recovery. What we also know is not all transfemoral are equal. The smaller they are, the better. You have less complication. In a nutshell, you know, we strongly believe that, you know, transcatheter, transfemoral, smaller, you know, frame size, it is what will be key to success here. Having effective, you know, therapy and very safe, you know, therapy. The next question that, you know, everybody is asking us and me is, "So why are you currently developing, you know, two platforms?" I think the answer is very simple. You know, one is we are committed to leadership. We know that if we want to unlock, you know, this large market potential and treat, you know, this underserved, you know, patient population, TEER is not going to be sufficient. Replacement is necessary. We are committed, you know, to bring a game changer here to complement, you know, TEER. We also know that developing a mitral replacement is not easy. As a company, we have done that, you know, for 60 years. Having, you know, two platform give us the insurance of leadership. The good news is, you know, we have two platform doing very well. You know, EVOQUE OS is running. We are running a single arm, you know, study in the U.S. you know, we have, you know, the SAPIEN M3, which is leveraging, you know, the basically, you know, the SAPIEN 3 most proven valve. We are running a pivotal studies with 3 arm basically we expect completing enrollment of a main cohort around the end of next year. In a nutshell here, you know, we are very excited about our progress. We are committed, you know, to significant mitral milestone in 2023 across our 3 key value drivers: bringing best innovation, world-class evidence, and being able to achieve in the real world great outcome for every patients. Super excited about, you know, what we are going to do, you know, for mitral patients. Let me shift gear to tricuspid. In the past, you know, it was the forgotten valve. It was highly underrecognized, undertreated, and therapy option were very limited. What we see today is in our clinical study is a rapid trial enrollment. I'm sure when you look at a medical convention, there is an increase in a clinical research. People are talking more and more about it. As early as TCT, there are dedicated tricuspid sessions. In Europe, we see a growing commercial adoption of our PASCAL for tricuspid patient. Clearly, transcatheter therapy has fueled interest. What we see tomorrow is that with strong evidence, like our CLASP II TR, our TRISCEND II with EVOQUE, all of these have a potential to change the practice of medicine here. The once forgotten valve, you know, can emerge as the unforgettable valve. It is, you know, truly exciting, you know, to see that. You know, I see the promise. It is still early, but I see the promise. Now, as I think about this evolution, I am confident in our ability to lead and transform and address, you know, this large unmet, you know, patient need. Let me start with PASCAL first, and then I will talk about EVOQUE. PASCAL Precision here is also very impactful in tricuspid patient. The tricuspid valve is, you know, very fragile. You know, there, you know, it has thin leaflets, dense chordae, large coaptation gaps. What we see, you know, is we are very pleased, you know, what we see, you know, from PASCAL. Great in the real world. Great also from, you know, the few study we presented at London Valve. At London Valve, as a matter of fact, you know, we presented 8 study across mitral and tricuspid. 3 on tricuspids. PASCAL, with PASCAL. All of them, you know, is solid, positive, early. You know, we need to be very cautious all the time. Early, very positive. For instance, you know, TriCLASP, which is, you know, our study, real world, post-market in Europe, almost, you know, 200 patient, we're able to show the great outcome. You know, high procedural success, low complication rate, and patient felt, you know, better, way better. Super exciting year, you know, for these patients. Now let me jump into EVOQUE. We also, you know, presented at PCR London Valves, you know, the 1-year TRISCEND single arm with EVOQUE. You know, more than 100 patient and one year follow-up is meaningful for a valve. You know, we know that as, you know, as a valve company. What I want you to look at 2 metrics. The first one is mortality. When tricuspid is left untreated, you know, the mortality rate is between 30% and 45% in one year. Big number. EVOQUE, one year with this study, again, you know, preliminary, 10%. That's a big difference. The second metric I want you to look at is the reduction in TR. O ne year after treatment, 98% of this patient, you know, are down to mild. You know, they feel way better. You know, we are, you know, very excited about the potential of what this platform can do to this patient. Obviously, we need more data, we are very committed to world-class evidence. We are running a pivotal study, a randomized study for symptomatic severe TR. It is randomized. You know, basically EVOQUE against OMT, optimal medical therapy. We expect, you know, the enrollment is going very well. We expect enrollment to be completed, you know, by mid-next year. We have, as you can imagine, you know, a lot of confidence, you know, in this platform. We leverage all of our know-how as a company, how to design a valve, you know, the tissue technology, you know, the delivery system. It is sub, you know, 30 French. We are committed, you know, to bring even more innovation. In terms of, impact to patient, we are aiming to achieve a CE mark approval by the end of next year and a U.S. approval by the end of the year after, 2024. Let me wrap up Tricuspid here. Here also very committed about big, impactful milestone in 2023 across innovations, clinical evidence, achieving real-world outcome. Let's go into revenue for next year. Yes, many medtech company, we see the potential headwinds, the regulatory environment in Europe, especially for businesses like ourselves, where we bring in a novel therapy to market. Also, you know, all of this, you know, staffing, COVID stuff, you know, happening in the U.S. and Europe. We see that as a potential headwinds. We also see the potential tailwinds with all of the evidence we are bringing. Again, the beginning was at TCT, a pivotal study, you know, CLASP IID, 8 presentation at PCR London Valves, many more to come. Can we accelerate adoption? Can we also accelerate, you know, the vital growth in the market? We took all of that into consideration, and this is how we think about, you know, next year, having this range, you know, between $160 million and $200 million. What I want to do is, you know, wrap up, you know, this TMTT story and you to remember, you know, basically two things. You know, I am confident that the combination of best technology, a portfolio of technology to be able to treat this very complex and diverse, you know, patient population, world-class evidence, and, you know, partnering with clinicians like we know how to do as a company, will have the potential to transform care for the many patients in need long-term. I am also confident that, you know, 2023 will be another high-impact year on this remarkable journey. You know, thank you. With that, you know, I want to introduce you Daveen Chopra, who is going to talk about our surgical businesses. You know, we are going to do another transition, Daveen and I. You know, 5 years ago, we transitioned, you know, the surgical business. When he joined our company, he did an amazing job, and now he's going to take, you know, TMTT to the next level. Thank you. It's been a transformative decade in cardiac surgery. The awareness of heart valve disease is much bigger than it was in the past. That means that the TAVR volumes have increased, but it also means that our surgical volumes have increased. Aortic valve surgeries continue to be done at a rapid rate, as is mitral valve surgery, as well as other structural heart surgery. They're coming sicker, more advanced in their disease, needing multiple valves or multiple procedures on the same patient. Therefore, the pressure on the surgeon to handle these more complex procedures is only going to increase. Having a partner like Edwards that listens to what we tell them is happening on the field to partner together is the only way we can help patients live their full potential. Thanks so much, Bernard. I appreciate the introduction. It's going to be fun to transition over to TMTT, and I appreciate all your leadership in this transition to come. Today, I'm excited to talk to you a little bit about the surgical structural heart business. I think as you heard from both Bernard and Larry, structural heart disease therapies are growing. They're growing across the world. As a result, we see that surgical structural heart market will continue to grow in the mid-single digits, where we believe that this market will exceed $2 billion by 2028. If you look at what's driving the overall surgical structural heart market, we see that these macro trends, as Larry talked about, there's obviously an aging global population. There's also growing access and wealth in emerging markets. We see that new structural heart innovations, especially transcatheter technologies, are helping increase overall awareness for structural heart disease. We think that overall awareness is going to drive more diagnosis of patients and eventually more referrals to heart teams. When you get to heart teams, there's always going to be a group of patients that are best treated surgically, and that's what we see growing the overall surgical structural heart market. If you look at the legacy of Edwards Lifesciences, for over 60 years now, we've been partnering with leading cardiac surgeons to understand patient unmet needs, to invent amazing new technologies, and then bring them to market. We've seen this innovation cycle lead to not only many amazing innovations, but if you look today at our business, over 50% of our revenue come from products that were just launched in the last 5 years. We have a vision as a business to continue to work with these cardiac surgeon leaders and meet other unmet needs for patients in leading transformative innovations. If you look at the unmet needs of surgical patients today, you see that patients today are still looking for extended durability and lifetime management with their valves. They're looking for great solutions to complex and concomitant cases, and they're also looking for best-in-class innovations globally, not just in the U.S. With that in mind, we, quite a few years ago now invented what we believe is the leading RESILIA tissue that we believe will really provide the greatest durability. If you look at tissue valves over time, the greatest way that they fail over time is through calcification. What RESILIA does is that it effectively stops those calcification formation pathways, allowing a valve to have greater durability over time. What you see with the RESILIA tissue is that patients are able to have an active life, to have a life where they don't have to have a mechanical valve and the anticoagulation and lifestyle trade-offs that come with that. They're free to have the confidence to live the life that they want. Right, we've got and now built an amazing amount of clinical data around the RESILIA tissue. We see now that through two pre-market studies of over 800 patients, we've had zero structural valve deterioration at 5 years of follow-up. We're continuing to follow many more patients in the post-market. We have over 14 different post-market studies now enrolling over 6,400 patients with RESILIA tissue that provide a great foundation on how RESILIA works in patients. As we look into 2023, we've actually got a couple important clinical milestones. The first one is that in mid 2023 we're gonna present pivotal data, pivotal 7-year data on the RESILIA tissue. This is now with 7 years of follow-up. If you note with many kind of tissue valves, when you get past the 5-year mark, you start to see kind of linear, you know, significant deterioration. In our bench-top testing, we've really seen that RESILIA seems to last a lot longer than previous generations of tissues. We believe now that this clinical data will help prove that out at 7 years of follow-up. We'll also see that in early 2023 we'll start enrolling in our MOMENTIS study. It'll be a very large multi-country, multi-center core lab adjudicated study to get a great set of data on our newest MITRIS mitral valve. If you look at what we've done with RESILIA tissue, we've now in the surgical business, in addition to now the TAVR business, put it on 3 different surgical platforms. The first platform or first product is our INSPIRIS, our flagship surgical aortic valve. This obviously has the extended durability treatment, but also beyond RESILIA tissue it also has this VFit expandability. What this means is that over time, if you need to go back in and re-intervene on this surgical valve, you can actually enlarge the valve, make it bigger, so that you can get a larger TAVR valve in there, which will lead to better clinical outcomes over time. What we've seen in 2023 or what we believe in 2023 is that the continuous kind of INSPIRIS adoption global adoption is gonna grow the business in 2023. Our second RESILIA platform is actually our KONECT aortic valve conduit. This is a product for very complex patients where you have to not only replace the valve, but the root as well as the ascending aorta. What this product does is that it really helps streamline procedures for physicians as well as for patients with a preassembled design, so it makes it so much easier. If you look at this market, the market of these complex aortic valve replacements, we think in the U.S. it's actually growing high single digits. The market for these complex procedures is growing high single digits, and we believe in 2023 that KONECT will easily outpace this market growth. Switching gears over to mitral valve replacement, an area of a lot of opportunity for Edwards. We see that valves need to be replaced sometimes when you can't repair the valves because of tissue quality, it's a reoperation, rheumatic disease, endocarditis, et cetera, and we see that patients are looking for better options. Overall, this market globally is about 200,000 patients growing in the mid-single digits. Around the world on a global basis, the vast majority of these valves now are actually mechanical valves with the trade-offs with anticoagulation and lifestyle. However, in the U.S. specifically, actually porcine valves are the most used valves in the U.S. We see here that actually patients are looking for a more durable solution than porcine valves. This is where our MITRIS mitral valve comes into play. Not only featuring RESILIA tissue, as I talked about previously, it includes other kind of lifetime management features as well as ease-of-use kind of features. We actually believe that with this valve, which we launched in the U.S. in mid 2022, that in 2023, Edwards will then become the mitral valve replacement leader in the U.S. I'm excited to share a little bit more about one of our patients who really benefited from the MITRIS product, Rick, and his physician, Michael Chu. I had rheumatic fever as a teenager, and a few years ago got to the point where I'd have to stop and, you know, catch my breath. To go from climbing 60 feet silos to not being able to walk to the barn, it was very concerning. Rick was completely unwilling to consider a mechanical valve because farming was his livelihood. It was a part of his DNA, and he felt that being on a blood thinner permanently would've prevented him from doing his work. I talked to him about the opportunity that we have to be able to implant a new generation valve, the MITRIS RESILIA mitral valve, which takes advantage of the previous success of the PERIMOUNT design, but adds in the promise for better durability with the RESILIA tissue. The MITRIS RESILIA prosthesis has a nice low profile. The radiopaque frame also facilitates future transcatheter intervention if it's needed, although we hope this valve will last for the rest of his life. Once I was out of the hospital, the shortness of breath, you know, it wasn't there anymore. Today, he's doing great. He just carries on life like he did before. I don't feel the worry that I used to. I feel much better, much better. Life is good. It was awesome to see Rick return to his life that he loved to lead with the MITRIS valve. Moving for a minute over to mitral regurgitation. I think as you saw Bernard say, of all the people with mitral regurgitation in the U.S., only 3% of patients who have mitral regurgitation actually get treated. If you look specifically at the low-risk degenerative MR patient, surgical mitral repair is indicated for the low-risk degenerative patient. If you see it going forward in the future, we obviously see that many, many more mitral patients are gonna be treated with the advent of transcatheter technology. We continue to see that for the low-risk degenerative MR patients, we believe surgery will continue to be indicated for this group of growing patients. When you look at this group of surgical mitral repair patients, getting a consistent high-quality surgical repair is tough to do. We've seen recently from CoreLab adjudicated multi-center data that as high as 16% of patients at 2 years of follow-up don't have an optimal surgical repair. We think this is an opportunity to improve upon this 16%. That's where we're working on a product called the Mitral Adjustable Repair System. This is a product, a surgical product under development right now that will enable beating heart adjustability of the implant. You can change the implant size during the procedure to really eliminate any regurgitation. Hopefully it'll lead to more consistent great outcomes for surgeons and for patients. As you move forward to 2023, we see with the surgical business that our estimated revenue range is between $870 million and $970 million, or approximately a mid-single-digit growth rate on an underlying basis. Some of our headwinds are that, you know, there could be additional TAVR conversion that would happen in some other developed markets around the world, and there's obviously always gonna be overall healthcare spending pressures. We can see that perhaps that we can get additional tailwinds of increased RESILIA penetration that could come along from maybe more tissue to mechanical valve conversion on a global basis. In summary, we see that the surgical market is actually continuing to grow, especially those who have these complex concomitant procedures. We look at Edwards Surgical continuing to outpace market growth coming from our RESILIA innovations out there. Beyond just RESILIA, there's a lot of other unmet needs. There's a lot of opportunities for Edwards to continue to identify those unmet needs in these surgical patients and invent amazing innovations for them. Thanks so much. I'm very excited now to introduce a good friend of mine, Katie Szyman, to come on and talk a little bit about the Critical Care business. We are incredibly grateful that people have developed these tools for us and allows us to pick and choose what we think is relevant to use to help improve patient outcomes. Our real aim is to make all of this technology a part of our daily lives in hospitals all over the world. Hey, good afternoon, everyone, thank you all for giving us a reason to come to New York during the holiday season. I'm personally super happy to get some shopping done after today. It's just great to see everybody live here and have a chance to be together. What a great day. I'm here to give you an update about the critical care business, and wanted to just first of all, share with you our strategy for growth. Our goal is to grow critical care really through three major areas. The focus, first of all, on improving the quality of care for millions of patients throughout the world. We're super proud that this past year we hit a milestone of improving care for approximately 16 million patients, and we're really doing that in three key ways. One is through bringing out new technology, the second is through bringing out clinical evidence, and the third is driving adoption. Let me walk you through a little bit more about that. Before we get started, I first wanna share with you an amazing patient video sharing a little bit about a story of someone who's very close to our heart, one of our sales rep's mothers. Let's play the video. Last year, I have a very severe asthma attack. I keep trying to get air out of my chest. It was just panic. It's hard to put into words what my mom means to me. She's my North Star. I had to try with all my might to do something for her. I got to the hospital, and she had been there for over 12 hours. I kept asking the charge, "What's going on with my mom?" I determined, after looking at her parameters, that her blood pressure was dropping pretty rapidly. I called the nurse in and I said, "Hey, my mom's hypotensive." She was like, "You're right. There is a problem here. I need to go call the MD. I saw my little girl grown up. Now she's there helping save my life. I feel really great today, and I'm able to continue making memories, creating moments. You know, that's the most precious gift to give someone. That's really the reason why we all get out of bed every day, to make a difference in patient lives. First, let me talk a little bit about the hemodynamic monitoring market. If you think about hemodynamic monitoring, there's really two kind of ways to think about it. First is core monitoring, which still remains the majority of our business today. In core monitoring, we're providing basic blood pressure information on a continuous basis about patients. When it comes to Smart Recovery and smart monitoring, what we're doing is taking our basic blood pressure information waveform and coming up with additional parameters like cardiac output, stroke volume, and really giving advanced monitoring information to clinicians so they can better care for their patients. Today the market is about $1.2 billion, where we have... You can see about a third of our disposable revenue comes from the smart monitoring category. Now we see in the future it going to about $1.8 billion, where we're continuing to see the higher growth aspect is smart monitoring, growing those smart sensors and smart technologies. What that means is smart monitoring plus faster recovery. Getting patients home to their families faster equals Smart Recovery, and that's what we're all about. Let's talk about the three components of that. One is technology, second evidence, third is adoption. Smart Recovery really begins with technology. I love this pyramid because it kind of encapsulates everything that we do all in one slide. At the foundation, we have our smart monitoring platform. HemoSphere builds that foundation. It's artificial intelligence enabled. It then has on top of it our algorithms. Every year we come out with more smart algorithms that enable our Smart Recovery technology. Then finally, we have our sensors, and we have what we would call our classic sensors of FloTrac and ClearSight in the Smart Recovery category. We're systematically going through and coming out with an IQ sensor, an IQ cuff in each of those categories. You need to have one of the IQ sensors in order to unlock our hypotension prediction algorithm. These sensors create more value, and they are at a higher selling price overall. What we're doing, as we call it, we're smartifying our entire portfolio, taking our basic sensors and shifting them to be smart or IQ sensors. What is the difference in the algorithm? First, our monitors always will describe to you how your patient is doing right now, this moment. With the hypotension prediction indicator, we're actually able to predict and tell clinicians what's going to happen for their patient 15 minutes from now. Finally, what's coming out this next year is our prescriptive algorithm, which is basically saying that fluid is like a drug to our patients, and we're able to make fluid recommendations or prescriptive recommendations to clinicians, again, in order to improve the patient outcomes. The foundation of all of that is our HemoSphere platform. Similar to the iPhone, I kind of am making this argument that it's similar to the iPhone, we actually came out with the original HemoSphere in 2017, 2018 timeframe, and we are already on the 7th generation of that technology. Each year we've come out with a new HemoSphere that either adds a sensor or adds a new algorithm. The... You see now that we are in this process of rolling out the HemoSphere into our installed base. In 2023, by the end of next year, we'll be just over 50% of the rollout of the HemoSphere technology. By 2028 we would be fully rolled out with HemoSphere. Now we're starting to shift and continue always to shift our focus to also expand. Not just replace the existing installed base, but then to expand into new hospitals with our Smart Recovery technology. You can see all of the sensors that are used with our HemoSphere. You can also see the new thing that's coming out with HemoSphere, this next generation is our connectivity solution, where actually clinicians can see the patient's data, whether they're in a different room or whether they're supervising some of the nurses, they can actually see on the iPhone how their patient is doing today. What does that mean? As we shift towards Smart Recovery, today about 15% of our sensors are the IQ version of the sensors. As we look to the future, we see that becoming more than 50% of our sensors. That's really gonna drive the growth in Smart Recovery, is this conversion to using the more advanced sensors. On HemoSphere 7, as I mentioned, we have multi-tech monitoring, the ability to have 2 sensors on at 1 time for 1 patient. We have an advancement in the hypotension prediction. Finally, we're launching assistive fluid management, that predictive area of our algorithms. I could talk all day long about how amazing I think Smart Recovery is, but I think you'd like to hear a little bit from one of our clinicians, Dr. Ashish Khanna. Let's roll that video. HPI has really revolutionized what we do for our patients. In the operating room, it allows me and providers like me to get ahead of hypotension. Rather than react and respond to blood pressure that we actually see as low on the monitor, we are now able to anticipate hypotension and prevent it from happening. More importantly, I feel HPI has allowed me to understand why hypotension is happening or is going to happen and allow me to find the most appropriate and precise treatment for hypotension. Beyond just the smart technologies, one of the challenges that we have is how do we convince clinicians that they should actually adopt and use our advanced algorithms? It's a bit like your iPhone. When they come out with a software change, you're like, "Really? This is frustrating. I don't want to have to deal with any changes." As we've come out with hypotension prediction, that represents a change to fundamentally how clinicians are used to treating low blood pressure events for their patients. We first did an original study that I showed you last year, where we were able to show that we can reduce the average duration of the amount of time a patient is in a hypotensive state from, by 58%, from 28 minutes down to 12 minutes. You can see on the other side of the page the number of studies, large studies that are trying to say, if you reduce the duration, can we also improve the outcomes, specifically AKI? Reducing acute kidney injury is a big impact if you can reduce hypotension during the procedures. Let me show you one of the specific multi-center hospital quality projects that we did and that we published this past year. This is three centers here in the United States using Hypotension Prediction in their cardiac centers. They had 1,400 cardiac patients, and they were able to show versus their baseline, that they were able to reduce the mean ICU length of stay by seven hours and a 34% reduction in total ventilation time. As I'm sure you know, that's very impactful to the patient's recovery and their ability to get back home to their families faster. We were really proud. That was presented at the AATS this past May to all of the cardiac surgeons that were attending. Now let's talk a little bit about awareness. In the awareness area, what we're trying to do is just raise awareness of the importance of hypotension, and that hypotension matters. First of all, this past year, the OIG, the Office of the Inspector General, published a report that said that hypotension during surgery is one of the top five potential causes of harm to patients, which really raised awareness significantly. The second is that we did a partnership with US Anesthesia Partners and NorthStar Anesthesia, representing north of 50% of the total anesthesiologists here in the United States. They just published last month at the ASA, they presented their findings that in over 150,000 of their patients, they found that roughly 28% of these patients had a mean arterial pressure below 65 for more than 15 minutes, which was really significant. This was all range of patients, high and low-risk patients. Finally, as you probably know, CMS came out with a quality measure where they are actually reimbursing clinicians, anesthesiologists, if they can demonstrate that they're keeping their patients above that mean arterial pressure of 65. Really kind of making it important to them in terms of how they're actually reimbursed as well. We're making progress, but of course, awareness and adoption are so important. Really, it's gonna take some time. As Mike mentioned at the opening, clinicians, and in fact, all of us, resist change, and it's hard to kind of get adoption, so we've got to keep coming out with evidence and keep raising awareness on how important that is. As we look to the next year, we're very optimistic about this next year. We have estimated again mid-single digits in our growth rate. One of the biggest factors for us is how the recession is going to impact capital budgets. We've seen kind of a big catch-up in 2021. It stayed up there in 2022. As we look at next year, it's always uncertain how the recession will impact the hospital capital budgets. On the flip side, the adoption of our IQ technologies is going quite well, and we really see this real-world data continuing to drive adoption. In summary, I'd just like to say thank you for listening. It's just a great time here in the Critical Care business. We're leading the Smart Recovery with our artificial intelligence-enabled technology. We are truly reaching more patients, $16 million. We have a vision to hit $20 million by the year 2025, and we are gaining the adoption, most importantly, to be able to get patients home to their families faster. I think in Critical Care, as we always say, we believe the best is yet to come. Now I'm happy to be able to turn all of you over to your first break of the day. Thanks, everybody. Days in the heart. Oh well, you really need to know. You really need to know. You better be my baby. Oh. Be my little now. Be my little now. Be my little now. Be my little now. Be my little now. Be my little now. Be my little now. Be my little now. Be my little now. Be my little now. Be my little now. I've been waiting for a guy to come and take me by the hand. Good sensations make me feel the pleasures of a normal man. New sensations stir the innocence, leave them for another day. I've got the spirit, lose the feeling. Take the shock away. It's getting faster, moving faster now. It's getting out of hand. On the town, run down the backstreets. Into no man's land. Lights are flashing, cars are crashing. Getting frequent now. I've got the spirit, lose the feeling. Let it out somehow. What's news to you is news to me. We will meet again. I'm watching you, I'm watching her. I take the data from your brain. Who is right? Who can tell us? Who gives a damn right now? Until the spirit news sensation takes hold, then you know. Until the spirit news sensation takes hold, then you know. Until the spirit news sensation takes hold, then you know. I've got the spirit. Gotta lose the feeling. I've got the spirit. Gotta lose the feeling. Feeling. Feeling. Feeling. Feeling. Feeling. Feeling. Feeling. Feeling. Feeling. Feeling. Feeling. Feeling. Feeling. Feeling. Feeling. Feeling. Feeling. Feeling. Feeling. Feeling. Feeling. Feeling. Feeling. Feeling. Feeling. Feeling. Feeling. Feeling. Feeling. Feeling. Feeling. Feeling. Feeling. Feeling. Feeling. Feeling. Feeling. Feeling. Feeling. Feeling. Feeling. Feeling. Feeling. Feeling. Feeling. Feeling. Feeling. Feeling. Feeling. Some boys kiss me, some boys hug me. I think they're okay. If they don't give me proper credit, I just walk away. They can beg and they can plead. They can't see the light. 'Cause the boy with the cold hard cash is always Mister Right. 'Cause we're living in a material world and I am a material girl. You know material girl. I'm a material girl. Some boys romance, some boys slow dance, that's all right with me. If they can't rise my interest, then I have to let them be. Well, some boys try and some boys lie, but I don't let them play. Only boys who save their pennies make my rainy day. 'Cause we're living in a material world and I am a material girl. You know that we're living in a material world and I am a material girl. I'm a material girl. Boys may come and boys may go, and that's all right, you see. Experience has made me rich and now they're after me. 'Cause everybody's living in a material world and I am a material girl. You know that we're living in a material world and I am a material girl. I'm a material girl. Shorty gets down, good Lord. Baby got 'em open all over town. Strictly biz, don't play around. Cover much ground, got the game by the pound. Getting paid is a fortune, each and every day to play. I can't get her out of my mind. I think about the girl all the time. Good side to the worst side. Oh, she pays the price. It's no surprise. She got tricks in the stash. She's taking all the cash. First when it comes to the cash. By no means average. As long as she's got to have it. Oh, baby, you're a perfect 10. I like the way you work it. No diggity, I gotta back it up. I like the way you work it. No diggity, I gotta back it up. I like the way you work it. No diggity, I gotta back it up. I like the way you work it. No diggity, I gotta back it up. She's got class and style. She eat knowledge by the mile. Baby, never act wild. Very low-key on the profile. Catching feelings is a no. Let me tell you how it goes. Curves, the words. Spins, the verb. Love is here it comes, so freak what you heard. Hey, ya, hey, ya, hey, ya, hey, ya. Man, that girl look good. Hey, ya, hey, ya, hey, ya, hey, ya. Play on, play on. Hey, ya, hey, ya, hey, ya, hey, ya. She's got class and style. No diggity. No doubt. No doubt. I like the way you work it. No diggity, I gotta back it up. I like the way you work it. No diggity, I gotta back it up. I like the way you work it. No diggity, I gotta back it up. I like the way you work it. No diggity, I gotta back it up. Looks like we made it. Look how far we've come, my baby. We might have took the long way. We knew we'd get there someday. They say I'll bet they never make it, but just look. We're still together. Still going strong. You're still the one I run to. All right. Look at that. The room quieted all on its own. Thank you. Well, there's no walk-up music or video for the finance presentation. We'll try to make it interesting anyway. You've heard a lot this afternoon about the path that we're on for Edwards to become a leader in this new era of structural heart innovation. We're especially excited about the opportunity Edwards has to make a difference by introducing new therapies to more patients around the world. We're also enthusiastic about the prospect of creating impressive value for shareholders. It's timely and topical that we're sitting here at the New York Stock Exchange at the end of a year that's been tough in the stock market and especially tough for Edwards stock. I'm really excited to be here and talk to you about how we're executing our plan and the value opportunity that we think it presents. Our financial objectives are centered around the opportunity to generate sustainable organic sales growth that fuels healthy profit margins and enables strong cash flow that we can use to make smart strategic capital allocation decisions. It's integrated with our strategic plan. When we think about how the strategy matches up with our financial objectives, there's a holistic linkage in decisions we make about resource allocation for things like Research and Development programs, investments in our global supply chain to help continue to support the growth in our business development, and the types of resources and where we put resources for our field-based personnel who are highly trained and sit shoulder to shoulder with the physicians who are treating patients around the world every day. Regarding sales, we're in this privileged position of being able to address large patient populations and to have sales growth that's fueled by successful long-term investments in Research and Development programs. That's what's really generating this organic growth. Ultimately, it puts on us in a position where we can have a leadership role that's supported by an evidence-based value for patients and clinicians and healthcare systems and regulators and all the other stakeholders that are impacted by the work that we do at Edwards. In terms of sales, you know, we've had this long run of at least 10 years of double-digit organic top-line growth that paused in 2022, and you've heard a lot of the reasons around it, driven by hospital staffing complications and the other interruptions and disruptions that originated with COVID, but we're still working through those headwinds today. We're excited that in 2023, we see a path back to 9% to 12% growth on a consolidated basis. At this conference, we always do the say did. What we said a year ago was we expected low double-digit sales growth of $5.5 billion-$6 billion with a $120 million of negative impact from FX, margins of 78%-79% and EPS of $2.50-$2.65. Well, it turns out, we think now we'll be at the low end of the new range of $5.35 billion-$5.5 billion with a $270 million negative impact from FX. If you break it down, we've got about $150 million more in negative drag from FX or about a third of the miss from the midpoint of our original range of $5.75 billion-$5.35 billion. The other two-thirds was shortfall in revenue from especially TAVR and some of the other business units as well. You know, our adjusted gross profit margin was around 80%. It was lifted by FX. It was not lifted, especially by any changes we made in the way we're operating the company. Due to the hedging program that we have in place, both with financial hedges and natural hedges, we got this lift in gross profit margin that will largely go away in 2023. I'll talk more about that in a minute. Here's what's underlying our 2023 expectations. We're assuming a gradual recovery in hospital staffing and a resulting improvement in procedural volumes. We're expecting growth across all of our major regions, the U.S., Europe, Japan, and the rest of the world. At current rates, we're now expecting about a $100 million headwind to sales in 2023. Using 2022 rates applied to our sales forecast in 2023, we think it reduces sales by about a $100 million. This is less than what we said six weeks ago on our third quarter earnings call. At the time, we said it's going to be about the same as what we're forecasting in 2022. FX rates have changed dramatically in the last six weeks, and that's the reason why we're now expecting just a $100 million headwind. We are expecting an accelerating growth rate during the course of 2023. Think lower sales growth year-over-year at the beginning of next year than in the latter part of next year. This largely has to do with just the year-over-year comparable. The first quarter of 2022 ended up being a pretty strong growth quarter, and it makes the bar a little bit higher for demonstrating year-over-year growth rates the first quarter of 2023. Overall, 9%-12% growth or $5.6 billion-$6 billion in sales. For modeling purposes, we'd point you to $5.8 billion on consolidated sales at today's exchange rates. Longer-term, in TAVR, we're talking about low double-digit growth rates fueled by the continuing march that we see towards this $10 billion total addressable market in 2028. In TAVR, we're expecting similarly growth across all major regions in 2023. The launch of SAPIEN 3 Ultra RESILIA is gonna be a big factor in our growth in the U.S. in particular, in 2023, so we're excited about that. We're anticipating stable average selling prices on a global basis and share positions on a global basis. In transcatheter mitral and tricuspid therapies, you heard Bernard talk about our focus on excellent patient outcomes. We think that there's gonna be a healthy lift to sales in Europe and in the US as we introduce PASCAL here. We're really focused, most importantly, on building this solid foundation and confidence-building experience for physicians by getting great patient outcomes. We're expecting EVOQUE Tricuspid in Europe to be approved late next year. We're disappointed that it was not approved this year. We talked a little bit earlier about MDR and the impact and uncertainty that's created around that approval timeline, but we're really excited about EVOQUE and the experience that we've seen so far and the impact that we think it will have on patients. We expect to complete enrollment in the ENCIRCLE Trial for SAPIEN M3 in 2023, and we're going to continue to advance these pivotal trials that we laid out earlier this afternoon. Overall, we're expecting $160 million-$200 million in sales at today's exchange rates. Think $180 million for modeling purposes. In surgical structural heart, we talked about RESILIA and the importance that has in helping to grow this business, both for aortic valves and for mitral valves. We're expecting another year in 2023 of mid-single-digit rate growth or $870 million-$970 million. Similarly, in critical care, we're expecting mid-single-digit growth fueled by this continuing improvement in Smart Recovery with this leading predictive technology. You know, it's unusual in the critical care field for there to be much data generated, and Katie and her critical care team have been doing just that, and we think it's really gonna help seed growth in the years to come as new clinical data gets introduced for physicians and their patients. The second element of our financial focus and expectations is around profitability and continued healthy gross profit margins, despite the fact that we've got this FX benefit from 2022 rolling off in 2023. Strong gross profit margins. We're gonna continue to be funding our field-based organization, so that hits us on the SG&A line. We're investing aggressively in R&D, both in clinical trials and the actual research that goes on before we launch clinical trials. At the bottom line or towards the bottom line, we're gonna continue to maintain a smart and efficient legal entity structure and tax structure, when we make changes to the companies. Our gross margin is gonna be unfavorably impacted, as I mentioned before, to the tune of about 300 basis points in 2023. Last third quarter earnings call, 6 weeks ago, I said 250 basis points. That's increased based upon what's happened to rates to where we think now it's a 300 basis point deduct from gross margin at today's rates. Obviously, rates have been moving around a lot. We're trying to give you updated information, and that's what it looks like today. Overall, we're expecting 76%-78% gross margins. We'll get some lift from product mix and the faster growth of our higher profitability products, as well as some of the operational efficiencies that we're continuing to see as we expand and grow the business across our current seven production facilities. We're continuing to add capacity in the years ahead. Negatives, in addition to FX, are just wage and materials inflation. For Edwards, it's not a big number, but it's a factor that we're watching and we're managing very carefully. We're really proud of our global supply chain, both within Edwards and the partners that we have outside of Edwards. Not just managing inflation, but keeping our supply chain intact and making sure that we can have finished goods on the shelves available for physicians and their patients around the world. Despite all the disruptions to other supply chains, we've fared pretty well. In terms of operating expenses, SG&A and R&D in 2023, we're gonna continue to see benefit from just leveraging our scale. As the company grows globally, we get benefits from being able to spread the investments we make and what it takes to run the company across the board. We are seeing the same FX impact that's gonna be a negative to our operating margin in 2023. Again, think about 300 basis points. That'll take our operating margin to about 30% for 2023. We're also gonna continue to make investments in clinical trials. We expect R&D as a percentage of sales to be 17%-18% in 2023, similar to 2022. We're excited about the initiatives that we have underway to inspire more therapy adoption. We're investing in going direct to patients, direct to caregivers, direct to physicians. There's not huge numbers in terms of percentage of sales, but it's an important and growing source of investment that we're making in the business, especially to help drive TAVR adoption. Here's a just a walk in our earnings per share from 2021, where we had $2.22. To this year, we're expecting $2.40 to $2.50. Same guidance we provided on the third quarter earnings call. You can see next year the walk goes from $2.40-$2.50 to just low single-digit growth to $2.45-$2.60. Think low $2.50s at the midpoint of the range. A lot of this is FX almost entirely offsetting all the profit from growth. A lot of the FX is a carryover from 2022. 2022 profit was boosted by having our hedge program in place, and we're gonna feel the effects in 2023. This is exactly how the program is designed to work. We have not figured out a way to outthink, outskate the global FX markets. All we do is try to lock in and protect the guidance that we provide every year at this investor conference, and that's the reason why you see this big headwind hitting us in 2023. 3rd financial objective is capital allocation. We're really focused on continuing to generate robust cash flow. It supports our global capacity expansion, so investments that we put into our plant and facility network around the globe. It helps us fund acquisitions. It helps us fund external growth, we'll talk more about that in a minute. Ultimately, we're really passionate about returning capital to shareholders through share repurchase, which we've been doing very aggressively in 2022. For free cash flow, we're projecting $1 billion-$1.4 billion in 2023. This year, we're not providing an update on our free cash flow for 2022, but year to date, through the third quarter, it was about $800 million. Share buyback. We've done 2 accelerated share repurchases in 2022. We've also been doing other repurchase activities that got us up to about $1.7 billion in total share repurchase. You can see in the last 10 years we've taken, on a split-adjusted basis, our shares outstanding from over $700 million to now over $600 million. We've taken about 100 million shares out of the market through ongoing consistent share repurchase activity, and we think it's been a real value creator, and we're going to continue to be active in share repurchase over time and opportunistically. We're really focused on two things. One is offsetting the dilution from our pay-for-performance philosophy and the stock grants that are issued to employees. Two, we wanna keep bringing in the net shares outstanding. We think it creates real value for shareholders, and so we're gonna be doing that on an ongoing basis. We're also investing capital for the future. Our capital expenditure forecast for 2023 right now is about $300 million. It really falls into a couple buckets. More than half of it is for manufacturing redundancy, manufacturing resiliency, and capacity expansion. We also invest significantly in our infrastructure. For those of you who have been to our Irvine headquarters campus, you've seen we've invested in a lot of new laboratory space where our Research and Development engineers continue to do their magic. We're gonna continue to fund our capacity to be able to innovate and design new technologies for the years ahead. That's a little bit of a just a snapshot of where we're pushing capital into the business. We are very active in portfolio management and business development. We don't talk about a lot of the acquisitions we do because they're generally small, and there are competitive sensitivities, so we don't really wanna advertise all of our actions that we're taking. Usually, we're looking for companies that, number one, fit our strategy. Just because we have cash on the balance sheet does not mean that we're changing our focus on structural heart and critical care medicine. That's where we really focus our attention in terms of our external growth supplements. We look for generally smaller tuck-in acquisitions. Most of the types of businesses that we can buy are small, early stage, pre-revenue, pre-approval, sometimes pre-final product design, and it fits well as a complement to what we do internally in R&D. We're also continuing to look at our portfolio of products, and when we see products that either have become non-strategic or where the profitability profile and potential is more limited, then we'll look for a way to try to reduce that element and take products and codes out of our business. We also look carefully about our R&D programs and think carefully about where the real growth opportunities are for new initiatives that we underway, and we're pretty disciplined about making sure that we are managing that on an ongoing basis. Just a summary of guidance. I won't go through this, but it's in your books. If you're interested, it captures what was in the press release today and the other slides that you've seen so far. Before I wrap up, I just wanna summarize some of our long-term expectations and how we're running the company. First and foremost, we're expecting the opportunity in the markets we serve to double from $10 billion to $20 billion. I wanna pause there for a second because one of the questions we've gotten is, "Hey, with the shortfall in sales in 2022, does that change the trajectory of your sales growth between now and 2028?" The short answer is not really. We missed sales, excluding foreign exchange, by about $250 million in 2022 relative to the midpoint of our original guidance. $250 million in one year doesn't really change the overall picture and opportunity between now and 2028. The second area where we're focused longer term is on operating efficiency. We have the opportunity to expand our margins. We think about this carefully because if we wanted to, we could boost our margins pretty quickly by cutting down on R&D, slowing down the investments we're making in our field-based personnel to support the growth of the company. We've just chosen not to do that. We think the opportunities are so important ahead of us that we should keep investing and keep funding these programs. We think they're gonna pay off over the long term. We do have an opportunity to toggle margins, and we're continuing to look for ways that we can do that when it's appropriate. Finally, in terms of earnings, you know, we're gonna see a tax rate this year that is comparable at the midpoint to the tax rate we're seeing in 2022. Next year tax rate similar to this year tax rate. At probably best case, it's neutral. There's probably gonna be upward pressure on that over time based upon some of the legislation that's being discussed right now. Earnings per share, again, repurchase activities combined with all the other actions we're taking, we think earnings per share has an opportunity to continue to grow and grow faster than the top line. At least that's the model. To wrap up, you've heard about the linkage between our financial objectives and our strategy. Overall I can say, you know, Edwards is a purpose-driven company. We're on a mission to change the way medicine is practiced and to help patients in need, and we think we have a bright future ahead of us that's gonna benefit patients and all the other stakeholders and shareholders that we serve. With that, Mike, I'll turn it back over to you to wrap up. Thank you. All right. We're running a little bit behind, so I'll catch us up 'cause I wanna make sure that we have time for a good, robust Q&A. In typical Edwards fashion, we like to deliver on our commitments and stick to our schedule. We'll do exactly that. Hopefully, you enjoyed all the presentations that came in front to give you more visibility into our businesses and also our financials. Big picture for us, our strategy is unchanged. It's not because we don't take a hard look at it because we do that every year. I mean, we really turn it upside down. We work it hard with our board of directors, say, "Is this still right? It's, you know, it feels good, but is, you know, should we change this? We just come away as committed as ever and say, "You know what? This is the right strategy. Let's innovate. Let's lead. Let's stay focused." We're totally committed to that principle. We think it's differentiated, and we think it's a success formula, we really believe in that. 23 is gonna be a year of strong growth. We think it's gonna be a really nice year. I won't go through it more. Scott took you through the details, and you saw what was in each of the businesses. I could certainly lay that out in more detail, but 23 will be a good year. We don't just look at the next year ahead, as we talked about before. We're out there on a pretty significant horizon, always stay mindful that we should be delivering in the short term as well as the long term. This isn't, "Hey, you have to wait till someday to see results." You'll see results now. Our board is pretty special. I'm really proud of our board. They are highly engaged. These are super experienced people that are committed to our success, they do everything that you would want from a board, from support us when we need support to challenge us when we need challenging, and really engaging with us. They know our leaders. They know our strategy. They go deep. They bring all their experience, and they also stay on top of the leading practices and make sure that we really perform to the expectations of our shareholders and all the other various constituencies that we feel an obligation to. Sustainability is not a separate subject inside Edwards. We don't have a separate over here. We kinda have it just integrated into our strategy. As, you know, Scott talked to us as a purposeful company. That's very much the case. It's just integrated into everything we do. We get recognized externally for our sustainability practices, but that's not why we do it. It kinda comes natural for us, and we're gonna continue to do that, and it'll be a normal course of business. You know, my own performance measures and the performance measures of the executive team incorporates achieving all of our goals to continue this to be a highly sustainable company. We're fortunate to be a successful company that has nice profitability, and it gives us the ability to be able to give back. That's really important to all of us. Our, our employees love, a matter of fact, the fact that we give back. When we get meetings together, often we'll have a charitable theme to the meeting, and we'll do something with that as the team-building activity that we'll do. We have a signature program that we call Every Heartbeat Matters that has a goal of improving the lives of $2.5 million additional underserved structural heart and critically ill patients by 2025. It got harder with COVID to accomplish this. We've got over 50 partnerships to do this, but we're gonna do it. We're gonna achieve this goal. Very excited about that. We also have a simple message to employees. Wouldn't it be great if every single person in the company did one thing charitable each year, something that you care about, not something that the company cares about, your own charity? They embrace that and go for it. The last time we surveyed, over 85%. It's sort of in the DNA of the company. I'll just close by saying I think that the company is poised for a very bright future. Why? Big population needs us, right? These patients that are suffering from structural heart disease, the critically ill and beyond, they don't have great solutions yet. We can make a difference. If we can design procedures that you can do in a short period of time, 1 or 2 hours, and get people home in 1 or 2 days and change the course of their lives and do it cost effectively for the system, we create a tremendous amount of value. We focus on those large populations. We're fortunate to have built credibility and trust that it gives us the privilege of being able to innovate and have people take us seriously. We've got this incredible culture where people come because they say, you know, "Yeah, I like the pay, and the benefits are nice, and the facilities are nice, but what makes me feel good about my job is that I know I'm helping patients around the world." That just is a real glue for the folks that work at Edwards Lifesciences Corporation. We got a pretty special R&D team. Not only are they very bright people, but they're innovators. They go for it. They dream big. They reach high. You have to learn to deal with failure along the way because that's part of it when you reach high. We've got this nice culture that really puts us in a position to be able to accomplish some things that might have been unthinkable not long ago. Our formula for growth doesn't count on doing some kind of a brilliant acquisition. It's to organically create opportunities and turn that into real growth for the business on a long-term basis. When I look ahead, I feel like the best days are in front of us. We're sort of entering a new era of structural heart innovation. I mean, when I look ahead, I say, "Wow, this is good." We're in sort of this golden age where it was what we did in the past, we're gonna almost look at as primitive compared to what we're able to do in the future. I'm super excited about what's in front of us. With that, we're gonna take a short break, set up for some Q&A. The break won't be long, and then we'll jump right in, and we'll have the, matter of fact, the whole team of speakers here to join me. Thanks. Keep flowing like a river to the sea, to the sea. Till it's gone forever, gone forever. Gone forever. Forevermore. You will find him drinking under tables. Rolling dice and staying out till three. You will never find him being faithful. You will find him. You'll find him next to me. You won't find him trying to change the devil. For money, fame, for power or to please. You will never find him where the rich go. You will find him. You'll find him next to me. Next to me. Oh. Next to me. Oh. Next to me. Oh. You will find him. You'll find him next to me. When the money's spent and all my friends have vanished. I can't seem to find your help, all are for free. I know that there's no need for me to panic. 'Cause I'll find him. I'll find him next to me. When the skies are gray and all the doors are closing. The rising pressure makes it hard to breathe. When all I need's a hand to stop the tears from falling. You will find him. You'll find him next to me. Next to me. Oh. Next to me. Oh. Next to me. Oh. You will find him. You'll find him next to me. When the end is coming, buildings falling down fast. When we spoil the land and try to pull the sea. When everyone has lost their heads around us. You will find him. You'll find him next to me. Next to me. Oh. Next to me. Oh. Next to me. All right, everybody. Welcome back. I hope you enjoyed the afternoon. A lot of good information. We've got an hour now for Q&A. It is a little after 3:20. We'll run to about 4:20. I mentioned earlier, we've got Kimberly Schulte-Kamp on this side with a microphone, Linda Wright on this side with a microphone. We'll do our best to get to everyone's question. To the extent you could limit it to 1 question and 1 follow-up, I think we'll have a good chance to do that. Who wants to kick us off? Robbie Marcus. Thanks. Robbie Marcus, JPMorgan. First, Mike, congratulations on retiring. Thank you. Excellent career. Well done. Bernard and everybody else moving around, congratulations. Maybe I could start on the guidance with TAVR. It's been a tougher second half. It's still growing, but not as well as expected. Yes. We're seeing an acceleration in the guidance throughout 2023. What gives you confidence that you will see an acceleration return to double-digit growth in TAVR? Yeah. Well, why don't I start, Larry, you can talk more about just the big drivers. Just in terms of the guidance. You know, we feel like if you look over the last two-year CAGR, three-year CAGR, four-year CAGR, it's consistently 9%-12%. The last couple of quarters in 2022 are not indicative of what we think the growth is gonna look like as we model out 2023. The first quarter is kind of a high bar, as I mentioned before, because of the first quarter of 2022 being a high growth quarter. We've got a lot of confidence we're going to return to that two and three and four-year CAGR as we get into next year. Larry, do you want to talk a little bit more about some of the drivers for that? Yeah, I, you know, I think, as I talked about, we're seeing echoes going up. We're seeing a lot of the diagnosis starting to increase in the system, and we do believe that those patients are going to have to start flowing through the system. I think there could be a little bit of a backlog. It's hard to quantify. We also are going to have really a full year of the S3 UR launch in the U.S. We're also going to be launching it in Japan. We just feel like some of these COVID headwinds are, you know, gonna be largely behind us. Staffing, we are seeing that improve over time. I think it's a combination of all those things that give us confidence that we're gonna be in that 9-12 range globally. Okay. Maybe, just quick follow-up. Forgot to ask. Any differences geographically we should be considering? As we think about the TMT guidance, you know, that also assumes a pretty big pickup. How much of that is the launch of PASCAL in the U.S. versus continued European performance? That's right. You know, thanks for the question. Obviously, you know, we are, you know, present in Europe, you know, for quite some time now. The majority of the growth will come from Europe, but also the U.S. is going to be a good, you know, and important, you know, growth driver in the next year. We are going to expand. You know, we are just, you know, starting. You know, we are still, you know, training the team, training physician. We have, you know, great aspirations for the U.S. Think about, you know, more Europe than the U.S.., but U.S. will be important. Larry Biegelsen. Thank you. Larry Biegelsen, Wells Fargo. Thanks for taking the question, and I'll echo the congratulations to Mike and Bernard and the whole team. Mike, really, truly amazing 20-plus years. For my question, Larry, I guess I'll ask on the TAVR share question. It does look like Medtronic took some share in the third quarter. What are you assuming for 2023 for share, and what do you think happened, you know, in the third quarter regarding share? Yeah. You know, I think it's important to remember our quarters don't line up exactly. And I think, you know, we see slight fluctuations quarter by quarter, but I don't believe there's been any real share shift that's happened over time. And I think, you know, as new competitors come in over the longer period of time, we do model a little bit of share erosion. But overall, if you look at our history, we've been pretty solid about holding on to our share, and we're really excited about our portfolio and our product launches. And I think we feel great about our share position, and I don't think it's gonna move significantly. You know, it's not a big concern of mine. Just 1 follow-up for Bernard. Just Abbott is probably going to present the pivotal TRILUMINATE data in the 1st half of next year. They said they're gonna file. How does that impact your ability to, if it's positive, to enroll your tricuspid trials for TRISCEND II and CLASP II TR? I didn't see anything on that on enrollment. Thank you. Yeah, thanks for your question. You know, hopefully, you know, the data that we present will be positive. You know, as you know, you know, there is all the time, you know, a gap, you know, between when you present, you know, and when you get an approval, especially when it is, you know, the first device, you know, for this, you know, disease state. This is what we are assuming here. If it is positive, it will increase the enrollment of our CLASP II TR study, which is a positive for the field, a positive, you know, for patients. The TRISCEND II study with EVOQUE is probably one of the fastest enrolling study ever in the company and probably ever in the field. We are aiming to complete, you know, the study in mid-next year. The two devices are not necessarily treating, you know, the same patient population. I don't see any issue here. More of a positive than anything else. Vijay Kumar. Thanks for taking my question. Vijay Kumar from Evercore. Congrats to all of you. Maybe my first question here on the management transition. Mike, Larry, and Bernard, for all three of you. You know, transition is happening at a time when people are questioning on TAVR outlook. Is the market penetrated, saturated? You know, historically, when we've seen this, for other companies, there have been more transitions in the leadership team. Larry, Bernard, I know you guys work well together. Going forward, what can you say to give comfort to investors that there won't be any more transitions, any impact to the business here? Want to start off? I don't know. For me personally, I'm in the job that I want. You know, as you, as you get older, you know, when you're younger, you just kinda chase titles and you chase those sorts of things. As you get older, you have to start thinking about what do you really enjoy doing and what do you love doing with your life. I love being with the teams. I love being in the cath lab. I love being with our clinicians and working on groundbreaking trials, and I love doing all those things. You know, these two schmucks never get an opportunity to do any of that stuff 'cause they're out doing other stuff. You know, so I think I kinda have the best job in the company in terms of what I get to do, and I'm super excited about having my responsibilities expanded. You know, Mike and Bernard and I have spent a lot of time together talking about it. You know, I don't think I can add any more value to the company than I can in my current chair. You know, I've been here 37 years, and you're probably not done seeing me at these things every year. Let me tell you know, how do I feel about it, you know? I feel, you know, very confident for many reason. You know, first, you know, Mike and I, you know, we are all going to work in tandem for, you know, quite some time here, you know, until, you know, May next year. Mike is not going anywhere. He will be, you know, the executive chairman. That's one. I think it is super important, you know, for me to have someone like Mike, you know, helping me, you know, with this transition. Two is we have a great company. You know, when I came, you know, when I joined the company 8 years ago, I was amazed, and I am still today. You know, we have, you know, great people, amazing culture. The way we are innovating is pretty unique. The ELT, I have seen many leadership team in my career, that's probably one of the best that I have seen. I look at all of that. You know, we have great foundation. We have an amazing transition. I think about, you know, the, let's talk about Larry again, you know, which is, you know, very important to me. Larry is an amazing innovator. You know, the TAVR story is a unique story. Nobody has done, you know, what we have done with TAVR. Larry was at the beginning of it. Having Larry, you know, leading in two businesses, that's a great win for me. I love that. He loves that. I love it. We need that. I think it is a great solution for everybody. Yeah. Just to the broader point of transitions in companies, and I know it means a lot of different things in different companies, but if anybody, even for a second thinks that I stop caring as much tomorrow, January first, May, they got it all wrong. I mean, I'm all the way in. I love this place. I love our team, what we do, what we stand for. I think we have an incredible executive team. I really count on the fact that we're gonna show that, right? We're gonna show just how strong our team is as time go forward, and that when we're talking about the new era, I'm serious about that. It's a new era coming. That's a helpful answer. I think Bernard, Larry just gave you a compliment. He said younger people chase titles. There we go. You know, one on finance for you, Scott. You know, free cash flow, it's been flat versus your fiscal 21 levels. When I look at your margins, right, FX is 300 basis points impact, but 30% out margins in place. There's no leverage here in the operating model. With 800 TAVR centers, there should be some SG&A leverage. Where are those investments going in SG&A? Thank you. Right. A couple things. You're right, the operating margins in 2023, we think will look similar to 2022, which is similar to the way it's been for the last handful of years. This is intentional. We've just seen such big opportunities in TAVR and in TMTT in particular, that we feel like we need to fund them. Fund them comes in the form of funding R&D clinical trials and the 8 clinical trials we talked about. Also funding the growth with people in the field who can really help train physicians, support physicians, and make sure that patients are getting the outcomes that we all desire. We don't have to run the company that way, but we think it's the right way to run the company because our goal is not annual margin expansion every single year. Our goal is organic, sustainable top-line growth. With that, we do believe over time, we are gonna see expansion in the operating margins. You mentioned cash flow. Part of this is, you know, when you don't have expansion in the operating margin, you're not gonna have a lot of expansion in cash flow. We've got another headwind, which is the Section 174, where we now have to capitalize our R&D expenses and get the benefit of those tax deductions over years rather than all at once, which is the way it used to work. It may be that 174 gets addressed by this Congress. We don't know yet, but that's one of the reasons why we're a couple hundred million dollars shorter in cash flow than we would otherwise be. Joanne. Thank you very much. Joanne Wuensch. There's something you said earlier that said it's a big population that needs us. What's happening to these patients today? Are they passing away or are they a backlog? I'm having a really hard time trying to understand if physicians are seeing this big population, why they're not motivated or why they're not moving, or what a hospital's doing to address this. It's a great question. It's probably one that frustrates us more than anything. We know the patients with aortic stenosis. If you go all the way back to the PARTNER 1 trial, which were very sick patients, but there was a 50% mortality rate at one year if you had severe aortic stenosis and it went untreated. You could argue in lower-risk patients, maybe that's two years, patients don't live well with severe aortic stenosis, and we know that. It's clear in the literature. I think a lot of it is this assertion of symptoms and going all the way back to the guidelines, that you have these people with the severe disease, but then they're doing this mental gymnastics about whether they have symptoms and whether their symptoms are attributable to the valve disease and all of these other things. You know, the patient pathway, it's not like you go see the interventional cardiologist, and he manages your whole cycle of care. You're at a GP, and then you go get an echo, and then maybe you get referred to a GC. That doctor watches you for a while and before they ever refer you to a heart team. You know, one of the things that Brian said in the video that's really critical is once a patient gets any intervention, we have all the metrics in the world about what happens to them, how long they live, what the Kaplan-Meier curve looks like. From diagnosis to treatment, we have literally nothing. That's really what we're trying to accomplish with the AHA initiative, is creating metrics that hospitals are measured to that says from the time a patient gets a definitive diagnosis, how long does it take for them to get the appropriate guideline-indicated intervention? If we could get that as a quality metric that hospitals had to report on, and that was a 90-day metric, it would be an absolutely fundamental game changer to how patients move through the system. Yeah. You know, I would just add a little bit to what you said. I mean- When you think about the different parts of the healthcare system, there's flaws along the way. If the primary care physician, often because what Larry Wood said, this assertation of symptoms. If the physician sees this as old age as opposed to aortic stenosis, they don't act on that. They say, "Well, of course, you aren't able to walk as far or breathe as well as you used to do. That's just old age." And they misdiagnose, not through any fault of theirs, it's just, it's not obvious to them. In general cardiology, it's amazing the difference between general cardiologists. We see general cardiologists that routinely refer to a heart team as soon as they see aortic stenosis. We have others that say, "You know what? Let's keep an eye on you. Come back next year, we'll take another look." Right? When you get to the treaters, they actually don't have a great understanding of what's upstream. The treaters themselves, much like the surgeons that we dealt with, you know, two decades ago when we ask them, "Hey, are you treating all the AS?" "Oh, yeah, I never turn anybody away." They just don't have a good idea who never makes it to their door. It's a combination, but through our market expanding clinical trials, through the education efforts, et cetera, we're gonna make a real difference in that, and we'll gradually improve. Our first indication was for inoperable patients, which was a population that didn't exist. It turned into about a billion-dollar opportunity for patients that didn't exist. I think the one last thing about that. Sorry, I'm so passionate about it. Early TAVR is the other thing and, you know, we gotta get to the endpoint and all that. If we could take symptoms out of the equation for the treatment of this disease, it would completely change how patients flow through the system. 'Cause we'd just be treating the disease rather than doing all these other medical things. You just look for an echo that says that the valve's closed... Exactly. You don't try and estimate. It turns into track and field instead of Olympic figure skating. Just a quick follow-up for Scott. 30% operating margins, but you're gonna invest, but you're gonna expand. Help me reconcile those expanding operating margins over what time period and what do you think you can get to? Thank you. I mean, a lot of this is just when these investments that we're making right now in clinical trials turn into products and therapies that become commercialized. Longer term, we expect our top line to be growing faster than our expenses, and that's, of course, how we're gonna get margin expansion. But what we don't wanna do is curtail the opportunities we see right now for investing in long-term growth in order to demonstrate margin expansion in 2023. We're gonna keep the pedal to the metal in R&D. We're gonna keep going aggressively at it. But we do believe that over time, as revenues, the top line grows faster than the expenses, that we're gonna see margin expansion. It's probably gonna come more at the operating margin than it does at the gross margin. You know, sitting here in high 70%, that's pretty high for a med tech company. Operating margin is also high, we think that's probably more where it will show up over time. There's real opportunity, and I'll just pile on a little bit. For example, our supply chain is very strategic and very long-term focused. They've got a lot of ideas about automation and insourcing. It goes on and on, but potentially have margin-improving opportunities. At the same time, we're always introducing brand-new products that are very novel that maybe don't have the margin profile. There's some natural tension there. We've got some helpers along the way. Pito Chickering. Thanks. Pito Chickering, Deutsche Bank. A follow-up to Joanne's question with sort of a slight twist here. You talk about ageism as an issue for patients not getting treated. Just to make sure I understand that, these patients are diagnosed with AS and the doctors are refusing to treat them because of their age or they're moderate, or they simply aren't being diagnosed because of their age? No, I think what we're largely talking about are people that are in the system because what we track is from diagnosis to how long it takes them to receive therapy. I think the diagnosis happens. I think people order the echoes for the patients to understand it. I just think there's a bias in the system, and we see it. We probably see it even more in Europe sometimes where they'll literally say, you know, "This patient's 80. Should we really put them through this procedure and deploy this extensive, expensive technology when they're only gonna live another year or 2?" That's what's in people's minds about how long an 80-year-old is gonna live because they look at average life expectancy. It's a very different equation if you take a look at what the life expectancy is for someone who reaches the age of 80, and that's where you get to that 9-year point. I think there's just a tremendous amount of education that has to be done on this. There very clearly to me is a bias against treating elderly patients as aggressively. Whereas I think if a 65-year-old comes in or a 60-year-old comes in with that same disease, there's a real drive to get that patient treated very quickly. We see that in the data. Okay. The follow-up there is as you think about growth accelerating into 2023, is this being driven primarily by hospital staffing issues getting fixed, or is it primarily from getting these, the people that have been diagnosed with AS or that aren't being treated into treatment? I think it's a, it's a little bit of a lot of things. I think we've got to get patients off the sideline. I think, you know, the last couple of years, certainly there's been more patients probably waiting or reluctant to go seek care. We need to get that all working again. I think we are seeing gradual staffing improvements at the hospitals, and we are seeing them build capacity back into the system. You know, it's not like we've gone down from where we were pre-COVID. We've been growing, so the hospitals had been building capacity just not as fast as what they were doing pre-COVID. I think we're just gonna start seeing some of that return, some of that normalcy coming back, and patients moving through the diagnosis and treatment funnel more cleanly. I think what's happened is there's these COVID flare-ups, so somebody might be halfway through getting screened, and then they sort of drop out again, and then they have to kinda get back in line and come back through again. Hopefully, some of that stuff starts to dissipate. You know, we try to factor that all in pretty carefully on a global basis, and that's how we got to our guidance. Yeah. There's no perfect prediction of what's gonna happen. I get the privilege of interacting with CEOs of hospital systems on a pretty routine basis. They're not doing well right now between the combination of inflation and the fact that they have staffing issues that means that they can't do all the procedures that they'd like to do, and we're in a fee-for-service system. They're highly motivated to fix those staffing issues so they can do the procedures, so they can get paid and get their system back in balance. These are smart people that are gonna make it happen. They've built nursing programs, they've changed the way that they do their benefits and so forth. I really think it's gonna gradually improve over time. Travis. Hey, good afternoon, and thanks for hosting the Analyst Day. I guess you reiterated the guidance for 2022, but maybe give us a bit more color on how Q4 is shaping up some of the flu, COVID, RSV staffing trends and US, OUS. I'm assuming it's the quarter is not just all driven by currency getting better. There's probably some underlying trends that are better. Just any color you can give on Q4 would be great. I mean, currency's gotten a little bit better, but not enough to really change our guidance that we provided. You know, we gave guidance on October 27th, so right in the middle of the quarter or a few weeks later. We're just not gonna get into the week-to-week, play-by-play, by country, by business unit. What we will say is our guidance is unchanged. The guidance that we provided, back in the end of October is still the guidance for Q4. Okay. That's fair. For next year, you said pricing was stable, but you said there's a $1,500 markup on... I think it was SAPIEN with RESILIA. I wanted to make sure I understood those comments and how you're baking in pricing for next year. Also make sure you had a little more color on the X4 trial that you stopped. Yeah. So, a couple things. When we say pricing is generally stable, we're talking about that on a global basis. Because there's reimbursement changes in certain markets in Europe and other things that happen, you know, this sort of offsets that. We still do the volume discounting that we do, but we are absolutely going for a price increase with SAPIEN 3 Ultra RESILIA. The list price change is $1,500, that is factored into our guidance as well. You know, we're rolling that out throughout the year. When we roll out a product and there's no price increase, it just goes on the shelf immediately. When there's a price change, it has to go back through the recontracting process, that also takes time to get through. It's. You know, we're gonna be launching it all throughout the year as hospitals sign the contracts and as hospitals move forward. That's that. On the ALLIANCE trial, you know, I wanna be as clear as I can on this. We love the platform, and the valves perform spectacularly, and this trial was enrolling extremely well. We were really pleased with how the trial was going. The bar that we've set with SAPIEN 3 Ultra and now SAPIEN 3 Ultra RESILIA is really, really, really high. We see an opportunity right now to improve the user experience, and, you know, when it comes time that we enter the market with X4, it needs to perform at a really high level. You know, one of the things just to know too is we didn't do an early feasibility trial with X4. We went straight into a pivotal trial with it based on all of our bench testing and based on all of our things, and we just had a learning when we got into clinic. I'm extremely confident that we're gonna be back in trial next year. The changes we make are gonna be minor. Yeah. It's not something where it's affecting the delivery of the valve or the valve's not performing right. It's just a change that we think we can address, you know, relatively quickly. The problem is anytime you pause a trial and you have to restart it, you have to go back through the IRB review process again. You have to get FDA IDE approval again. So there's just a time lag there, but we'll be back in clinic next year with this platform. Yeah. Just it's fair to add that the X4 has a lot of novel features to it. I mean, it's really remarkable. It took some courage to jump directly into a pivotal without an early feasibility study, but we said, "Yeah. Let's go for it. We have a lot of expertise." When we learned some things and say, "You know, we can make it better," we said, "You know what? A slight pause, that's absolutely worth it, right? It's gonna pay off well in the long run. Well, remember too, we're just launching S3 UR now, so it's not like, it's not like we're in this portfolio wasteland where we have no new products or anything. We really have the benefit of time that we can take the time and really make sure we get it optimized. Josh. Thanks. Thanks, Mark. Joshua Jennings from TD Cowen. I was hoping to ask about the US TAVR market and just three buckets of smaller segments maybe you could comment on, Larry, and maybe for 23, but also throughout the 28, through 2028 as well. But just thinking about TAVR and SAVR, TAVR and TAVR, and maybe even low risk bicuspid patients. And those coming off of a smaller base, you should be seeing significant growth contributions from those three buckets. And I just have one follow-up. Yeah. I don't know if I can quantify them real directly, but I will say a significant part of our business is non-native aortic TAVR. We do a lot of surgical valve in valve. We do. Increasingly, we're doing more TAV in TAV. But the other thing that we do is, you know, people forget, we do mitral valve and surgical valve, so we fix failed mitral valves and that's indication for us. We also do rings, so that's another thing that we're able to do, and those are all approved indications for us. We also have pulmonic, which, you know, we're growing with Alterra. There's a lot of things we can do, but those alternative segments are all growing. And that's something that we benefit from as well. Thanks for that. Just a follow-up on, just CLASP IIF. It wasn't emphasized today and just wanted to understand why not. Has that trial design evolved similar to CLASP IID? Is that a Bayesian design now and an event drive? Thanks a lot. No, thanks for all the questions. First, you know, let me tackle, you know, the second question. You know, every trial is different. You have, you know, a different, you know, obviously, you know, statistical analysis, you know, endpoint, you know, all of that. You, you cannot expect that what we did with one trial will be translated to another trial, right? You know, we are trained to be aggressive, strategic, for sure. We want to also to bring, you know, world-class evidence. I would not expect, you know, this, you know, on 2F. With regards to why not talking about it is look, I talk about, you know, the one that we are going to achieve in a big milestone in 2023. EVOQUE completing enrollment midyear next year. CLASP IID, in my mind, is going to be very meaningful. You have a full cohort, you know, one year. This is, you know, an M3 with, you know, the, you know, ENCIRCLE. I try, you know, to focus on what's going to happen next year. 2F is going well. It is an important study, and I'm going to talk, you know, more in the next, you know, quarter, else. Chris Pasquale. Thanks. Chris Pasquale, Nephron. Bernard, a couple questions for you. We've talked a lot about the slowdown in the U.S. TAVR market. The U.S. TEER market has actually been even more sluggish in 2022. You're now a participant in that market. Have the causes of the slowdown there been the same as TAVR or different? What do you think that market grows in 2023? Yeah, I would say a little bit the same. There is also some differences. The same, obviously, you know, the COVID, you know, the staffing. You know, obviously, it is impacting, you know, all of this, you know, space. What's different though is, you know, the clinical evidence. In TAVR, we have so many evidence, solid evidence for years. We were, you know, one of the, you know, big leader in that space. For, you know, for mitral, like I said, you know, very little evidence in the past 10 years. Some of the evidence were mixed. Which is why I'm very excited about CLASP IID, even if it is just, you know, for the DMR patient population. Physicians are looking at CLASP IID, and they are saying, "Look, it is contemporary data with both devices, and it is working very well. You know, the TEER outcome is better than what it was, you know, five years ago, three years ago." I am totally hoping that this will give confidence to the physicians, to the community, and to patients. I think that is changing, and this is what is impacting, you know, the mitral space in the U.S. and in Europe, you know, to be fair. Yeah, that's helpful. Thanks. You talked about growing tricuspid adoption in Europe. Had some great data at London Valves. Can you ballpark for us just how big a part of the European business tricuspid is at this point versus mitral? We tend to think of that as a mitral business, but it sounds like you're making more progress in the other position. For sure, this is still, you know, small as a business. You know, we don't have the same base than mitral. Mitral, you know, was in Europe, you know, proved for about 10 years, 8 years or 10 years. We see, you know, a growing interest. Physicians are calling us, you know, to be trained, to start, you know, tricuspid activities. We are very impressed with the ramp that we see in tricuspid. We are pleased with the kind of outcome physician can achieve, you know, with, you know, TEER devices, you know, in the tricuspid, you know, disease position. Promise, a lot of promise. And it is exciting. Rick Wise. Bernard, during a bunch of recent doc calls lately, PASCAL's come up again and again, very positively. It just really strong positive physician reaction. Could you talk about your commercial initiatives in the U.S.? It seems to me this is one of the areas that could actually be more at the upper end because of the kind of reaction I'm hearing. Is that a reasonable thought? Yeah, no, let me, you know. Thanks for the question. Let me start, you know, first with the technology itself. Look at what we have done, you know. As a company, we know how to do that. You know, the way we are innovating. We launched with PASCAL, gen one. We came up, you know, like few months later with PASCAL Ace, and then, you know, a year later with PASCAL Precision. You know, this rapid evolution of a technology, you know, being able to respond to physician feedback, to make, you know, the technology better all the time. We have already ideas about the next gen, you know, PASCAL. Obviously, you know, we have, like you said, you know, solid platform. PASCAL Precision today is differentiated. In the U.S., you know, we want to be careful. You know, in my mind, it is all about excellent patient outcome from the beginning. Physician, they want to go fast also. We are, you know, the one telling them, "Look, training is important. It is a TEER category, 2 different devices. Let's take the time for you to be trained, your team to be trained. Imaging is also, you know, a good thing. Yeah. He's fighting this all the time, so it's routine. They say, "Hey, I do a lot of the other technology. Why don't you just give it to me? I know what I'm doing." Right? Exactly. Yes. It is like I see the potential in the US. Amazing platform. We are bringing evidence. We are going to be very careful about training this physician the right way and deliver, you know, on this promise. Great. By the way, don't demote Larry for calling you names in public. He's a good guy. You should hear what we do in private. A quick follow-up for Katie, if I could. Katie, I apologize for making you the macro person on the panel. Complicated capital environment, recession, chip shortages. Just any sense you could give us, are things getting better or worse? Stable? Are you feeling more encouraged, less encouraged on any of those fronts? Thanks so much. Thanks, Rick. First of all, we've really taken a strategy to make sure that we don't go on back order, and we've seen many of the companies going into back order situations. As Mike mentioned, we have a very strong global supply chain. We don't anticipate seeing any back orders, and we see some risk obviously. So far, as we look through next year, it looks pretty positive, especially on the chip front, which was a risk this past year. We just took the strategy, like, we're gonna do everything we can to make sure that our patients are covered. The question about capital and the recession, people have asked me at the break, you know, are you seeing it or are you just worried about it? I would say right now we're not seeing a significant change in our capital ordering patterns, 'cause if you recall, like, it takes a year, right? Between you start the order process till when you actually close. As you know, hospitals live on their investments, and that's really how they fund their capital budgets. We're just seeing that, you know, as the recession hits and as the equity markets are down, it may shift. Right now, I think we're in good shape. Yeah. You know, I'll just add to this. You know, Katie and her team have done an amazing job of innovating. They really have a lot of momentum going. I know she spends time talking about capital, and there is a component of the business that's capital, but it's the small component of the business. Most of it are actually disposables. Especially now that there's more value add within disposables because there are smart algorithms that are behind them, most of it is not really so sensitive to capital only. There's a portion of it, but not in a way that some other businesses might be. Mm-hmm. Adam Maeder. Hi. Adam Maeder, Piper Sandler. Thanks for taking the questions. Maybe just one quick follow-up on the TAVR outlook, the 9%-12% underlying worldwide growth. Can you just maybe talk about the different geographic assumptions between US, Europe, and Japan? Well, I'll start. Again, I'll go back to part of this has to do with the baseline comparison. We've had pretty high OUS growth in 2022, so it'll be a higher hurdle to get over that, and our expectation is that there may be pressure on the growth rate outside of the US, not because the business is not performing well, but because 2022 showed well. By contrast, in the US, a little bit lower bar, especially in the second half of the year in 2023. Having said that, penetration rates outside the U.S. are pretty low for TAVR. Still, by comparison to the U.S., there's a dramatic difference. We just see international growth rates continue to be probably overall a bigger driver. Yeah. You know, the other thing I'd say is, you know, I think the thing that Scott brings up is really right, 'cause there's so much quarter-to-quarter variability this year that if you go to different regions, if you look at Q3 in Japan, it got pretty hit pretty hard. You look next year in Japan, we're gonna launch S3 UR in Japan. We were right in the middle of the low-risk launch. We're just starting really the low-risk launch in Japan when Covid really hit, which made things difficult. The other thing is, Japan never got SAPIEN 3 Ultra. They never got SAPIEN 3 Ultra. They were still on the SAPIEN 3 platform. They're gonna go straight from SAPIEN 3 to SAPIEN 3 Ultra RESILIA, which is gonna be a big jump for them because it has all the benefits, you know, rather than just sort of the incremental benefits of the RESILIA. We're super excited about that launch in Japan and we think that's gonna be a driver too. We really tried hard to factor all that in, but it's hard to talk about the regions because it changes quarter-over-quarter based on what happened the previous year. Well, I'll just add to that. Just when we think we've figured out what the model is and cracked the code on what the growth rate's gonna be by region, we get surprised. This has happened consistently, but it also gives us confidence in our strategy for TAVR. Where having this therapy available now in so many countries across the world really gives us some protections, as one region may slow for whatever reason. Wave 7 in Japan, you know, tough comps, another one. We've got other fuel that can help propel the overall business performance. That's really helpful, Larry. Thank you for that. Then for the follow-up, maybe for Bernard, on PASCAL launch in the United States. Just any metrics that you can share today in terms of where we are with procedures or accounts and kinda how you expect that to evolve over time. If I heard correctly, did you say you've a sales force of 20 for TMTT, how do you expect that to grow kind of over the next 12 months? Thank you. Yes. Let me try to first, you know, start with the team. We started about a year ago with, you know, a small team of, you know, people. They are all trained, certified. They're ready to go. During, you know, 2022, we have hired much more many people. They are in training right now. By early 2023, we will have an expanded team ready to tackle, you know, more sites, you know, in the U.S. In terms of where are we, you know, we focus initially on the CLASP IID and CLASP IIF, you know, centers. The one who know the device already. Nevertheless, you know, they go to training again just to make sure, you know, we are going to have an excellent, you know, patient outcome. We are active in few centers. We have done few cases with great outcome. We are probably discussing right now with 40, 50, 60, you know, centers. We are talking about, you know, contracting, all of that. Think about it, though. When you come in a second with a premium price, correctly, like Larry said, you know, the contracting, you know, conversation are a little bit, you know, more slow and we need to show you the benefit. You know, innovation, differentiation, what we bring from an evidence standpoint, what our team are bringing to the physicians. Yeah. There is conversation happening. It's positive. Is it fair to say probably not really a step function in the U.S., but probably think of more of a ramp? Yeah. Yeah. Exactly. Thank you. Matt Miksic. Great. Thanks so much. Matt Miksic from Barclays. Mike, I'm gonna miss you, obviously. Bernard, congratulations. On all the progress in TMTT, and I guess, Larry, for having the best job of the group. I wanted to follow up on a couple things that we've talked about. Mike, you mentioned just now that OUS maybe is gonna be a stronger contributor to growth, given the penetration rates and opportunities there and product cycles you just talked about. Mm-hmm. Can you hit that middle point of your TAVR guidance, call it 10-10.5%, you know, if U.S. doesn't return to double-digit growth during the year? I have one follow-up. No, I think we need the U.S. to grow. There's no doubt about it. It's the biggest part of our business, we need them all to grow. Underperformance in the U.S. is not gonna get swamped by overperformance OUS. We really need that to come together. On the margin, of course, there could be some compensating, overall, no, we need it all to work. Yeah. Okay. That's great. Scott, following up on margins. Flat 22-23 roughly on the operating margin. One thing that many of the other companies talk about that you don't talk as much about is sort of inflationary pressures as it pertains to this next coming year. You had a big you know, impact from FX hedges and so on. Labor is obviously a bigger part of gross COGS maybe for you than some of the other folks that we cover. Can you talk a little bit about if that's a part or why you don't talk so much about it as you move into 2023? Yeah, sure. First, just clarification on margin. Absent FX, margins at the operating level will be close to the same with 2022, we're gonna see a several hundred basis point decline based on current rates from our forecast for 2022, all due to FX. you know, longer term, your second part of your question was about. Inflation. Inflation. Inflation. You know, longer term, we think we're gonna see more evidence of wage inflation. Short term, we're seeing, you know, probably a 0.5 point to gross profit margin, so, you know, a 0.5 percentage point hit as a result of inflation. The reason we probably don't talk about it as much as some other companies is because it may not be affecting us as much. You know, we do buy materials and supplies, but it's not as big a component of your overall cost of sales. It's an issue. Yeah. dozens of people managing it actively, but it's not something that's really changing our overall economic outlook. It's fair to say, probably some of the efficiencies that we had in supply chain end up covering up some of those inflationary matters as well. Right. Yeah. Anthony? Thanks, Anthony Petrone. Congratulations, Mike. Great career building the company. Congratulations, Bernard, John, everyone on the new roles. I just wanna jump back to TAVR pricing in 2023. It looks like just on the base price, that's about a 4%-5% increase. I think we typically use a $32,000 base price, so is that accurate? I think the data out there suggests that the competitors out there with a slightly lower price, and so when you think of hospitals being a little bit price sensitive, you know, how much risk is built into that assumption. I'll have one follow-up. We take the list price up $1,500, you go from $32,500 to $34,000. Everybody has volume rebates in place, those will continue. For modeling purposes, you know, the number's obviously lower than that. We're not obsoleting SAPIEN 3 Ultra. If a hospital doesn't wanna move to the RESILIA platform, they don't wanna pay the premium, they can continue on the platform they're on of SAPIEN 3 Ultra. We're not Unlike other launches where we just took everybody, you know, we knew when we did the price increase, we were gonna have to stay with a dual portfolio platform. Everybody may not come, the people that do come, you know, can do it at a premium. We've also had some hospitals that says, "Hey, maybe we're gonna, you know, use both platforms and figure out how we do it." For me, I think, you know, it's a heart valve, you know. Do you really wanna say, "I don't know if I wanna give $1,500 for the better valve," you know? I mean, I think at the end of the day, people are gonna value the innovation. You know, frankly, Daveen's gone for much larger price increases on a percentage basis on INSPIRIS, and it's the number one implanted surgical heart valve in the world. Clearly people recognize the value of RESILIA. This is a really unique opportunity for us 'cause we get to partner and draft off of everything that he's built in the last six, seven years of the RESILIA brand and all the other things. You know, the surgical community's already bought off on it. They've already huge supporters of it. Yeah. As you see that, you know, we're starting to show more and more of the data that I started talking a little bit about today, people really say, "Yeah, this may be something a little bit different, so maybe it's worth paying a little bit more for." That premium, it's never easy, but it becomes a little bit more appetitable. To Larry's point, when you're, you know, you're talking about a heart valve, something that's saving someone's life, people are willing to kinda say, "Okay, let's have the best technology out there for that person," because we really think, you know, that extra year or two years or whatever that ends up being is important to their life. If you don't wanna make the journey, you can stay on SAPIEN 3 Ultra. A follow-up would just be on the workthrough. Starting from echo CT, and then to an extent, you can have an offshoot there, EKG, chest X-ray, cardiac MRI, and then catheterization. You know, a lot can happen in there. We're seeing that now. When you think about at the TAVR center, you know, what's being discussed there to maybe streamline that process a little bit, and is there anything potentially in the way of maybe guidelines that can change to say maybe one step can be taken out of there? Yeah. Then streamlines the process? Thanks. We talked about it a lot with the national coverage decision. You know, remember when you started, you know, two surgeons had to review every patient because the indication was inoperable patients. Who can determine if a patient's operable or not? It can only be the surgeon. The heart team's been really powerful, and half the procedures we did were transapical procedures. You know, there was almost this 50/50 involvement, and so it was really a true team. If we look at how the procedures evolved. You know, overwhelming majority of the procedures we do now are transfemoral, and even the alternative access now isn't predominantly TA. You know, people do subclavian or transcarotid or other approaches. A lot of... We now have low risk indications, which it doesn't take a surgeon to say whether somebody's low risk or not. A lot of these things are just holdovers because they've been written in the NCD for a long period of time. I think there's certainly things we could do to make it more efficient for patients. I think one of the things we're trying to do with the variable sizing aspect of X4 is maybe we can reduce some of the precision required about some of the pre-patient screening. Clearly, when we take profile down, you don't have to be as precise with the access screening. We've, you know, we've taken transesophageal echo out of the procedure largely, which also can take general anesthesia out of the procedure and just use conscious sedation. That's one of the ways we've driven the length of stay down and, you know, closure devices, all of those things, they all contributed significantly. Yeah. You can even add to that is in addition to those kind of fundamental changes that Larry's team is trying to drive, just what he talked about in terms of educating the valve clinic coordinators. I mean, their job is to move people through that system. We see experienced valve clinic coordinators that have well-oiled machines. They're able to move people through the system very efficiently. When we put on these programs, and we allow people to share best practices with each other, they're sponges, right? They come right up the curve. The same potential exists with the Target AS initiative by the American Heart Association. They're actually going out there, working directly with hospitals and developing measurements to say, "Okay, how well are you performing?" Those kind of things will ultimately make a difference. It's not that there's not a capability to do it. We have one of our centers, a few weeks ago, they had a patient show up in the morning, they were kind of urgent. They did the entire workup and did the procedure that day. It can be done. It just requires a lot of planning and a lot of handoffs and being done really precisely. Frankly, it's just not the way the healthcare system is built now. It's not the way they get paid, people, you know, schedule their different office visits and do their things, the opportunity is there to improve the efficiencies in the system more broadly. Rich. Hi. Thank you. Richard Newitter from Truist Securities. First question, I think one of the things people are trying to get a better sense of with the RESILIA pricing is, you know, with respect to the 9% to 12% underlying growth rate, just how significant of a contribution factor is that pricing aspect? You know, are we talking hundreds of basis points? Is it minimal? Can you give us any sense? We're all trying to figure out what the underlying kind of growth trajectory is for the business. It's in our guidance, but it's a small part compared to the overall unit growth that we have to get. It certainly is a contributor to what we have planned, but it's not the lion's share of where our focus is. Remember, like I said, we're gonna be rolling out through the course of the year. It's not something that is gonna be fully rolled out at the end of Q1. We anticipate that we'll be rolling it out all the way through the year next year. We're really focused on getting patients off the sideline and seeing the unit growth. That's our primary focus. Okay. Thanks. That's helpful. Then just, Scott, thanks for the geographic comments. I guess if I just think through it, really, you know, US is gonna be more of a back half acceleration. OUS is, you know, tough comps in the first half. If I, if I think of kind of the trajectory, is it fair to, fair to think or, you know, from a guidance standpoint as we build our models for the quarterly cadence, is it realistic to say that the double-digit potential is in the back half, really not in the first half, and we shouldn't really expect double-digits until the back half? That's a fair modeling assumption for now. I mean, obviously, we're trying to crystal ball this. We're just going into the holiday season, trying to forecast what happens as we get into Q1 with the tough comps from Q1 in 2022. Yeah, from a modeling perspective, that's a fair assumption. Lower in the first half, growing year-over-year growth rates as you get further into the year. Okay. Thank you. Bill Great. Thanks. Bill Plovanic, Canaccord. For Larry, just to follow up on the RESILIA with SAPIEN 3, you know, what percentage of the market or percentage of valves do you think in the U.S. will eventually be RESILIA? It sounds like you expect that transition to be complete as you're exiting 23. Is it 50% ultimate penetration? I think it's going to be the predominant valve. You know what might be interesting is, Daveen, why don't you comment on where do we stand right now in terms of RESILIA penetration on surgical heart valves? Yeah. I think as Larry correctly noted, the premium was much higher. Yeah. Uh- As Larry said, we had a much higher percentage premium and a higher dollar value premium, actually than that. When we launched the product actually in 2017, early 2018, we didn't have all the data we have today. Over the years, we just had a great linear growth, where today it's the vast majority of our product. You know, the majority of the product in the U.S. is the RESILIA tissue. It does actually just grow, and people take it on time. It did take a little bit for, hey, when you see a contract for the first time, and you have a contractor, and they look at it and say, "Whoa, wait. That's quite a premium. That's a lot higher than my competitors." You know, it takes a little time to show the value and explain the features and show the data, they've been coming online. It is a little bit of a process. Larry, do you wanna comment? Yeah. I think it's going to be the primary valve. I think it will become the leading valve in our portfolio in the U.S. I think that's... I think that's going to happen. Again, it's going to take time. The other thing, too, I'll say, is the approval came earlier than we had anticipated, we're still scaling up our supply and our manufacturing and some of those other things. That's something that paces our launch a little bit as well. It's fair to think that that transition will be complete as we're exiting 2023, or is this something? I Well, I mean, you know, I look at you launched in 2017, and there's still sites you're converting. Yeah. I think we'll get the bulk of it probably converted by the end of next year. I think, you know, we'll have the trickling effect that could go on for a couple of years. There may be some people that never make the journey. I can't tell you exactly what it is, but I have both platforms available. You know, it's not like that's the only platform where I take everybody there, and if you don't want to make the journey, then you have. Well, one of the things that nice is it's the same platform that we use in surgical valves. At the same time that that's going on, it's being launched in TAVR. We've got a lot of follow-up in patients with RESILIA. You're gonna be able to probably speak to what? Are we gonna see seven-year data? That's what I was talking about earlier. I think when we have the seven-year data, I hope that helps the TAVR business a lot when people can say, "Wow, we have 7 years of RESILIA data. Which may not mean much to you all, but if you're in the valve business, we've seen other valves that sort of start topping off around seven years. Yeah. It's a pretty meaningful data point. Yes. I think we see a lot of valves, as I mentioned a little bit. Like, each year after kind of five years, you start to really see that deterioration occur. You know, with our Benchmark testing so far, we think it's meaningfully different at seven years. I think if the clinical data helps support that, we will feel really good saying, "Wow, this tissue at seven years may be better than previous generations," which I think will help Larry Wood's group a lot and help the TAVR business a lot as well. My follow-up is just, are you seeing in terms of staffing issues, procedure volumes, a difference in the Benchmark sites that you have versus other sites? You know, if you kinda use that as your. Yeah. -measuring stick, how do we think about that and kinda how things- Yeah. No. The Benchmark program for people who embrace it and really adopt it and take on the whole program, they go from being able to do 2 cases a day in their system to being able to do 5 cases a day, you know. That just makes a huge difference in terms of their capacity because it's a lot easier to do more cases in one day than it is to add necessarily a second day. Getting the capacity, and it's also easier on us, you know, to send, you know, to send our people there and do the 5 cases than rather than do 2. It helps the whole system, and it's just a much more efficient way to do it. What we're really doing is just pulling unnecessary things out that aren't needed anymore. A lot of these things are holdovers from the early days. You know, when something's working, people are reluctant to change it. They're like, "Sure, we have the full scrub nurses here from the surgical center, but they've never heard anybody, so why not just keep them here, you know, just in case something happens." It's just not a very efficient way to run a system. That's why it's so important we do it in a peer-to-peer basis, where it's other physicians saying, "I've implemented it. Here's how we did it." Get administration involved. It's not, it's not a light switch. You have to walk everybody through the journey. That's one area where we partner too because if you can get to minimally invasive or non-invasive anesthesia, you can turn the room so much quicker, so. Cecilia and Matt, I see you over there. My eyes aren't as good as they used to be. I'm sorry it's taking me so long to get that far away, maybe the two of you, and then we'll wrap it up with one other after that. Great. Cecilia Furlong, Morgan Stanley. Thank you again for hosting this. I wanted to ask just Larry, your comments around where you are today, 850 or so centers in the U.S. and the thought of expanding TAVR teams going forward. Can you just speak to capacity in the system if you had full staffing today versus how you think about just the growth and need to continue to expand TAVR team capacity? I think we'll continue to add centers, but it's not gonna be at the same rate we have historically. As new centers wanna get added, you know, I'm sure we'll see, I don't know, make up a number, 10 or 15 a year maybe that might come on. The overwhelming majority of our growth is gonna come from existing centers rather than adding new centers. But centers have shown the capabilities of being able to add capacity throughout this entire journey. If you look at, you know, some of our volume we were doing even, you know, a few years ago, we were doing it in 400 centers. We have a lot more centers now than we ever used to have, and they've shown the ability to add that capacity. Benchmark isn't fully deployed. You know, we have a lot of hospitals that add a second day, or in some cases, they've added a second team. The capacity is there. I think it's just a matter of connecting all the dots for them. It's getting the patient referrals flowing, making sure they understand the need for adding an additional day or adding an additional team, and just working them through that process. I don't have any question the capacity is there in the system to handle more patients. Okay. Just wanted to follow up on the patient side. You talked about initially last year, direct patient outreach. You talked about it today again. How much of an impact do you think that's having, investment that you're anticipating going forward? Then just would love your comments, and Amin too, just, the discussion around low risk, that physicians are having with patients, how that's evolved from when low risk was approved in 2019 and the benefits, drawbacks of TAVR versus surgical. Thank you. That's the best one question I've ever gotten. In terms of our outreach efforts, you know, there's a lot of outreach efforts where we do that we can connect and say, you know, we reached out to these patients or we reached out to these referrers. We saw a pickup in referrals from that general cardiologist. We know that that program is working. When you do things like television or you do things like some of our digital media, it's harder to say, you know. People anecdotally say, "Yeah, I saw the TV commercial," or they anecdotally say, "I saw this on social media." Once they connect up through our digital platforms, though, through, like, Find a TAVR, and they give us their email address and wanna be caught up, then we can find them in the system, and we can find later if they were actually treated. We do see a lift from our therapy development efforts. We think they are working. It's just probably the hardest time right now to run analytics because the last two years have been so choppy with COVID and variants and all those sorts of things. You don't really have that steady state. Remember, it takes patients, you know, on average 4 to 6 months to move through the system, and it can be longer for the, for the older patients. The work that we're doing today to energize somebody, those patients may not show up for several months into the system. We got to factor that all in to our analytics. We're committed to the outreach programs that we're doing. We know they give us a lift, but it's not super easy to necessarily quantify exactly. You know, which program has the greatest lift, but we're continuing to run the analytics and we're always fine-tuning our investments for the things that we get early reads that say, this is working better than something else. In terms of the physician discussion with the patients, it certainly has evolved over time, but it lags. When we go out and do survey work, even for General Cardiologists, there's a shockingly high percentage that don't even realize TAVR is approved for low risk yet, even though that approval came some time ago. You know, once we find that information out, we can fine-tune our education. You know, you still have surgeons when they talk to patients and they say, you know, "You're a perfectly good surgical candidate, it's a tried and true. We've done this." There's still some of that that goes on. That to me is still less of the issue. The issue that I'm more passionate about, if somebody comes through the system and they're low risk and they end up getting surgery instead of getting TAVR, so be it. That's not really... I don't care that much about it. The fact that in an elite institution, 50% of the people with a guideline indication for AVR are not moving through the system. That's just where like, you know, there's just all this gold buried there, and we have to figure out how to address it. That's why it's become a huge area of focus for us. Yeah, because the TAVR-SAVR thing is now the minority. That's like the edges, right? If you look at surgical patients. Yeah. The majority in the U.S. are aortic regurgitation or concomitant cases or something else that's on label that's indicated for surgery, but probably doesn't make sense. That doesn't make sense for TAVR. If we just get more of those 50% higher, that's really what's going to drive the system versus we get a little bit of TAVR-SAVR ratio shifting. I think that's the minority of the growth. We've had, you know, I mean, again, it's been a little choppy the last couple of years, but we've had a number of times when we get a new indication, we see TAVR spike, but surgery grows faster than what had been growing before because patients come off the sideline. Yeah. Not every patient is a TAVR candidate. We see surgery grow. It is really about getting those patients energized and getting them off the sideline. Some of that's getting the GCs energized, some of it's getting the patients themselves and their caregivers energized. Matt Taylor from Jefferies. Two questions to add to these core debates, please. One is, I was hoping you could address the idea that some investors have brought up that excess mortality in the eligible TAVR, SAVR population has led to this kinda air pocket because of COVID over the past few years. Do you have any data or thoughts you could share on that as to whether that's a big enough factor to have changed your growth rates? The excess mortality, we do know that, you know, elderly patients were disproportionately affected by COVID. When you look at the people that died over the age of 80, you know, I think it was, around 150,000 people or something like that that had died that were over 80. If you look at prevalence rates of TAVR, you'd probably say, you know, 5% of them could have been potential aortic stenosis patients. You can do the math on that, and certainly, there are some patients lost there. That was sort of a one-year phenomenon. Even when you do that math and you compare, you know, 10,000 people or 15,000 people, if that's in the, in the loop, compared to the treatment rates and the overall group of people that's sitting out there, it's a really small number in the big scheme of the under treatment. There certainly were some patients lost, but I don't think that was, like, a big headwind to what we saw. Great. Thanks. One follow-up, Larry. I like your slide on the BCCs, I guess there's some good news and bad news there. You're trading a lot, a lot of churn. My big picture question is, in the current environment, there's all these staffing issues that are, you know, bottlenecks. How much of it is just macro, and how much of it can you actually influence and control? If you could give us 2 decimal places, that would be great. 18%. I don't know. you know, it's Every hospital we talk to complains about staffing. There's not a hospital that we talk to that doesn't say, "We can't hire enough nurses," or, "We can't get enough staff here," or. It's not just nurses and hospital staff. It's sometimes the people that help turn over the room and auxiliary staff and those sorts of things. That's clearly a problem. We also. We have a number of hospitals that are sort of back at their pre-COVID capacity, and those hospitals complain just as much about staffing as the hospitals that aren't at their, you know, that aren't growing at the same rate. I think staffing is a headwind, but I think hospitals are overcoming, and they're figuring out a way to get their patients treated. The thing that Mike said is absolutely true. Hospitals are hurting right now economically, some of the costs, some of the other structures. You know, they're not gonna get a radical margin improvement. The only way out of it for them is growing procedures. You know, you look at the cardiac procedures that are pretty profitable for hospitals, and TAVR procedures at most hospitals are pretty profitable procedures. Their way out of their economic challenge is to get their procedure volumes back up and to grow again. That's true. Thank you. We've got time for 1 more question. I'll turn it back over to Mike, who's gonna introduce a really special patient video. To the extent I wasn't able to get to your questions, I apologize. We're gonna have a reception right after this, where we'll have the management team available for another hour. Just before the last question, I also wanna thank Kim Schulcamp, Linda Wright, and Oliver Morozewicz. Really appreciate your help making this event possible. You guys are great. Last question to the analyst who traveled the furthest, I think, Ed Ridley-Day, all the way from London. We'll go to the patient video. Okay. Thanks, Mark, great to be here. A quick follow-up on PASCAL. We've talked a lot about the U.S. opportunity, let's look at Europe. You've got great success. You're well-established now. Can you update us roughly where you think your market share now is in Europe? Related to that also, the duration of sustained effect. That's obviously important data. Have you seen already a benefit in Europe from that data with the physicians you're speaking to? Thank you. I'm sure you remember, you know, we started in Europe in Germany. From the beginning. It is where, you know, we made a lot of investment. The team, physician training, opening account. We are very pleased about our share position in Germany. I'm not ready, you know, to give you a number, but very pleased about our share, you know, position in Germany, where PASCAL is well adopted by the largest German centers. They have great outcome. At London V alves, you know, to answer your second question, some of the physician multicenters were, you know, presenting, you know, PASCAL, and they were doing a propensity match against, you know, a MitraClip with great outcome. What we see Europe is Germany. We are. You know, we have a great footprint. France, which is the second-largest market in Europe, we are not yet present. We are going to use, you know, the CLASP IID data to get an approval and a reimbursement in France. In other country in Europe, we are expanding, and there is still, you know, more to do. We need to, in the next, you know, couple of years, we need to open, you know, new centers across Europe and in also in Germany. We are pleased, you know, where we are here and more to do, basically. Thank you. A very quick follow-up for Katie. To turn around the capital discussion, with what you're doing with Smart Recovery, frankly, you are helping hospitals save on time, reduce costs. Is that actually something that they wanna cut right now? Is it true that hospitals wanna save time and reduce costs? Is that the question? Well, they do, certainly. I would suggest, you know, HemoSphere Alpha's a nice solution for them. Yeah, I mean, I think it's very much similar to what we've been talking about here today. Like, if they can actually get patients out of the ICU faster, then they can bring in more procedures and take more risk on all of these cardiac procedures that we're talking about. The more that we use their own baseline data to show them that they can actually get patients home faster, they can actually get the throughput, then it helps everything. I mean, it helps the system, it helps nursing, it helps everything. We have seen the hospitals that adopt Smart Recovery getting that efficiency, and that's why you see kind of this correlation of the Benchmark program that Larry was talking about. Thanks for the question. Thanks so much for all your interest in Edwards. We never like to close one of these sessions without reminding ourselves why we're all here. As we mentioned before, what we do is kind of a team sport. Of course, the company is committed, but the physicians that we serve, the regulators that we work with, the communities that we're in, and frankly, the investors in our company are all part of this. It leads to some pretty fun stories, and we've got one to share with you now. I'm Dorothy Cantor. I'm 85 years old, although it's hard for me to believe that. I started out as a teacher, I went back and got my doctorate when I was 40. I ran for various offices within the American Psychological Association and was the 9th woman President. That gives me great pride. Over the course of my career, I wrote or edited 6 books. The book of which I'm most proud is one called Women in Power: The Secrets of Leadership. I've always been interested in empowering women, mentoring has become an important part of my life post-retirement. Nobody in my family ever died of anything but cardiovascular disease. 4 years ago, I had a really weird pain in the center of my chest, and I learned I had had a severe heart attack. I spent about 17 days in Morristown Medical Center. They told me that I had developed severe mitral valve regurgitation as a result of the heart attack. I was so weak at that time that when I got to a corner, I prayed silently that there would be a red light so that I could stop, and pause, and breathe. I do not like being impaired, and I felt impaired. It took two years before the doctors felt that I was ready for that magical PASCAL that they had been talking about. My son was picking me up the day after I had the PASCAL, and he said to Dr. Kipperman, "My mother's coming home with me. My guest room is on the second floor. Should I trade with my mother so she doesn't have to walk up the steps?" Kipperman said to him, "Then why did we do the procedure?" The results were amazing. I would say I live a better than normal life for an 85-year-old woman. There is barely anything that I cannot do. Nowadays, when I get to a corner, I get pissed if there's a red light, 'cause I'm a New Yorker, and when you get to the corner, you wanna keep going. That's like a busted tire. I actually got published again. A group of colleagues and I that meets Tuesday night over cocktails, we call it Drinks with Shrinks. Cheers. did a research project, wrote a paper, and it just got published in The New Jersey Psychologist with perhaps the oldest authorship of all time, average age 81. Now, I travel all over the country to see my family. It's very important to me that I see them, that I be a part of their lives. All of this is possible for me because I feel well, and I feel well because I have the PASCAL. From the bottom of my heart, I thank you. Pretty fun, right? It's really a privilege to be able to do what we do. I'm honored to say that we've got Dr. Dorothy Cantor with us here today, she's gonna be willing to hang around a little bit. Thanks for being here, Dorothy. You give us inspiration. Thanks, everybody, for your interest in Edwards Lifesciences. Me and the rest of the presenters are gonna be around. Dr. Cantor. I am. I'm the one who proves it works. If you have any questions, talk to me. Thank you. you. Thanks, all.