Okay, so we're gonna get started here. It looks like the timer's already started for us. My name is Dave Rescott. Thanks again for coming to the Baird 2023 Global Healthcare Conference. Senior MedTech Analyst here at Baird. Happy to have Mitch Hill here, CFO of Inari, a leader in the catheter abla- or sorry, not catheter ablation, catheter thrombectomy space for venous thromboembolism. Mitch, we are happy to have you here. Thanks for having me, Dave. We're gonna start. I appreciate it. From a high level, and kind of work our way through. Maybe just starting off, and I did wanna say upfront that we also have the ability to have questions from the crowd via the placard. I can get them on this iPad up here, so feel free to send in questions. So starting off, public three-four years now, you're approaching $500 million in sales. You had an Analyst Day last year. Maybe just for some of the clients, maybe to from Baird, who are newer to the story, if you could just give us a quick refresher on what really the company's accomplished since the IPO, and then what those key priorities are that you laid out for the next several years. Sure. The IPO seems like a long, long time ago, three and half years it's been. At the time of the IPO, and I think the company's decided to stay independent because of the two product platforms, you know. So basically, a product platform to treat deep vein thrombosis, which is called the ClotTriever product family, and then also a product platform to treat pulmonary embolism, and that's called the FlowTriever product family. As you may know, from a disease state point of view, people first develop a deep vein thrombosis, and those typically embolize, and they'll travel up and actually cross the heart and lodge in the pulmonary arteries. So DVTs lead to PEs, and so the diseases are actually related. So, we developed the two products. The company, when I joined, $6 million in quarterly revenue, so that was Q1 of 2019. So we've obviously come a long ways, you know, compared to Q2 of 2023, with $119 million of revenue. Company's made great progress. One of the things we talked about at the Investor Day a year ago was just the fact that we wanted to expand from being a two-product company into, like, a multi-product platform company. And this year's been a big year of transition for that, as we've introduced multiple new products, including three new products, which have an independent TAM. So essentially, we are a five or more, you know, product company at this point in time, and we have aspiration to continue to grow from there. Okay. And then maybe just on, you know, growth so far this year. I think the cadence of your guidance and performance this year so far has been, you know, a little bit more of a raised grade on the amount of what you've been. So I'm just wondering what some of the, you know, key drivers behind that success have been so far in the first half of the year. Yeah. So, 31% growth in the first half of 2023, compared to prior year. And the midpoint of guidance for the annual revenue for 2023, I think is about 27%. So, you know, it's decelerated a bit from the growth that we had from 2021 to 2022. That was about 38% growth. But I think part of that is just the, you know, large numbers thing, which is a little bit more, you know, challenging as you get bigger, I think, as everybody knows. We're really pleased with the performance of the business in the first half of the year. You know, we broke out the international revenue for the first time in Q1, and we've been able to continue to build to that. About 4% of revenue currently, we're messaging that that could easily grow to 20% or more of revenue in the future. We have some news maybe we can talk about later in the conversation, you know, about kind of where we're going or some of the large international markets. The two core product families have grown nicely, and even in the most recent quarter, we reported we're able to increase the revenue related to the core products, the new products that we've launched this year, and also the international part of the business, so really nice, nice, performance in all three segments of the business, if you want to think about it that way. I think our view for the full year 2023, you know, we're gonna continue to have additional contribution from the new products which we've launched. The international business is something that's continuing to kind of pick up momentum for us, and, you know, we've continued to add new sales reps to the field. And also, we've really been able to focus on this program-building exercise, which is something we do with all of our hospital customers to help them develop VTE Excellence programs, essentially to kind of systematize the treatment or the care pathway for people who come into the hospital. They're diagnosed with either a DVT or a PE in the emergency room, so then what happens after that? Okay. When you look at, you mentioned some deceleration just implied based on the guidance. So when you look at the second half, you know, of the year or the outlook, when you think about core VTE, new products, international, where do you think there is the higher propensity for there to potentially be upside, or what could come in better than what your current assumptions are now relative to those three factors? Yeah, I think. We're seeing nice traction with the new products, you know, although we've grouped those together with the ClotTriever. So it's kind of a ClotTriever and other concept in terms of how we reported the results in Q1 and Q2 of this year. So I think that's a nice potential upside for the company in the second half of the year. We're continuing to focus a lot of effort, and this is kind of different than 2022. 2023 time frame, we've. For those of you who are familiar with the 5 growth drivers, you know, the first growth driver was adding, essentially, new sales reps to the U.S., you know, field team, and I think that's something that has slowed in 2023 compared to 2022. We've had much more focus on growth driver number two, which is all about VTE Excellence, and there we're seeing some real interesting opportunities. There's both a grassroots effort that happens, so think about our sales team members and our economics folks, and our HEMA team, essentially working at a hospital-by-hospital level. Basically, you have the emergency room over here, so they're diagnosing patients with DVT or PE. You have the interventional folks over here, so those are the vascular surgeons, the interventional cardiologists, and the interventional radiologists. And we're trying to connect the dots between these two groups and basically say, "Whenever we diagnose a patient over here with DVT or PE, before we give them anticoagulants and send them home, let's ask one simple question." This is gonna be the dumbest question you guys hear today: "Is this patient a good candidate for interventional therapy?" That question doesn't get asked probably 70%-80% of the time in the hospitals across the U.S., and even less so outside the U.S. And so that's the idea behind this VTE Excellence, is let's ask that question. Let's consider each patient. Is it a good candidate or not? Some are, some aren't. If they are a good candidate, then we like our chances in terms of being the, basically, the company that's providing the most safe and effective tools for the removal of clot with minimal blood loss. Okay. Can you level set us on FlowTriever and ClotTriever in the US? We know that you and another player are thrombectomy therapies. There are other interventions that get done in the VTE and PE segments. Can you level set us from where you think you are relative to the thrombectomy penetration, maybe relative to the- Sure T otal interventional therapy penetration? And when we think about growth in both of those segments over the next several years, you know, market expansion. What's gonna happen? Share gain, share gain from other interventions, maybe. Yeah A little ASP. How do we think about those factors in there? Yeah, so the market as a whole, essentially for VTE diseases, the two diseases that we're focused on, about a $6 billion TAM in the U.S. And as I mentioned a moment ago, still 80% ish of those folks are treated with anticoagulant drugs, and basically, they're sent home, and they're told, "You're gonna be just fine." The 20% that are treated with interventional therapy, about 40% of those procedures, we believe, are still some lytic-based therapy. So those are both the legacy products. They're decades old, owned by Boston Scientific, the EKOS product for PE, and the AngioJet product for DVT. And so roughly 40% of the interventions are done using those products, and then the remaining portion of the interventions are done using mechanical thrombectomy. So there's in that space, primarily Inari and then one other competitor there. And the mechanical part of the pie, if you wanna think about it that way, we think that mechanical part is growing by 20% or more per year. And so as we've thought about our business, you know, this year, obviously, we're guiding to higher growth than that. As we think about the business, you know, in 2024, we feel like as the leader in the space, you know, that we should be comfortable, you know, growing at that rate or higher. You know, having said that, I'm not providing the 2024 guidance today, revenue guidance today. We'll probably do that, you know, early next year. You know, nor am I really commenting on the 2024 consensus numbers, you know, that are out there right now. A couple things we have going that are gonna shift, shift kind of the market, participants over time. One of them, just looking at the interventional portion, so again, this is just the 20% portion, we have a randomized clinical trial called PEERLESS, which is going on. There, we're comparing the performance of the FlowTriever device against a catheter-directed lytics devices. And in the PE space, again, the leading therapy there is the EKOS device. And we've gotten really significant traction with that trial. It's enrolled well ahead of schedule, and we're expecting to be able to provide a readout at one of the major conferences in 2024. We would expect when that readout occurs, we're very confident in the results of that trial, and we're gonna start to wave bye-bye, basically, to the use of lytics for the treatment of PE. I think that's a potential catalyst, David, for 2024, which would be nice for us. In terms of the longer-term plan, you know, that's kind of the ignorance and apathy, which is the 80% of the market that's treated with anticoagulant drugs. Mm. There, we have two randomized clinical trials going, one in PE called PEERLESS II, and a second one in DVT, which is called the DEFIANCE trial. Those trials, we are enrolling for DEFIANCE. DEFIANCE will take some time to enroll. It's basically an update of the ATTRACT trial from years ago, probably, whatever that is, 10+ years ago. And then the PEERLESS II trial is gonna commence enrollment probably in early 2024, and that will likewise take some time to enroll. But when those two trials are ultimately completed, you know, the real focus of our company is changing the standard of care, and those are sort of guideline-changing trials that will read out in years to come, and ultimately, we're looking to shift so that interventional therapy becomes standard of care. We would like to say that we'll take our chances, you know, when that, when that time comes. Okay. A lot to dig into there, and I do wanna get into PEERLESS in a second. But you know, if we start with and I don't know if it makes sense to break them out relative to DVT or PE, but when you think about the underlying growth of being 20%, so 20% mechanical thrombectomy growth, expecting to grow in line or above that level, is the goal, obviously, not giving 2024 guidance out. Right Y et. But when you think about that level of growth, is it primarily coming from the share gain of other interventions up until the point at which you have these market expansionary trials reading out, or is there still market expansion going on? Yeah I n both of those segments? Again, DVT, PE are a little bit different. Yeah. Maybe you can dive into both of those. Yeah, and I think maybe for the purposes of describing where the share is coming from, I'll kind of combine those together for a minute. But we believe that more than half of the growth of our business is coming from basically converting share away from anticoagulation therapy, so that's kind of the market development side of the business. A year or so ago, a lot of the growth was coming by moving people away from the lytic-based therapies, but we think that's less than half of our growth now is coming away from the lytic-based therapies. And I think we still think lytic stuff is probably 40% of the procedure volume today going on, whether in DVT or PE. That, again, I think, is kind of headed for the sunset as we read out on the PEERLESS trial in 2024. Okay. At the time of which, PEERLESS is reading out, I believe Boston has their own EKOS trial versus catheter-directed thrombolytic. Yeah. Sorry, versus anticoagulants alone. So more against that conservative medical management. Yep. If we have both these trials coming out at the same time, perhaps saying that maybe A is better than B and B is better than C, but, you know, you're saying that maybe B could be going away, B being catheter-directed thrombolytic. Yep. How do we think about both of those trials coming out at the same time? I think that's a. And where the market goes? Interesting, really interesting question, and I forget the property in math. Is it. Transitive, I think. Transitive or the commutative properties? One of you guys is a math major in here. Not me. But if A is better than B and B is better than C, then, you know, right? So, we think the readout, ultimately, it's called the HI-PEITHO trial. Mm-hmm. But the readout of that trial, I think, You know, if it, if it demonstrates the superiority of basically the lytic therapy to anticoagulation, and if our PEERLESS trial demonstrates the superiority of FlowTriever, basically mechanical thrombectomy, compared to, lytic therapies, then, you know, I think that'll actually be helpful to us. Okay. When you think about where penetration is today in both of those segments, and where, again, where it goes perhaps because of these market expansion trials, is it the case where you need a higher referral network of maybe the PE patients getting referred in, you need more of the DVT patients getting referred in, or is it a higher utilization or conversion of the existing interventional physicians that are doing these procedures? Meaning that, is it more coming from the top of the funnel, or you just need more physicians to pick up the actual mechanical thrombectomy procedure across the U.S.? Yeah, I think it's both. Okay. I think today, this is frustrating to realize, but today, there's still a lot of people, and I don't know how many people are in this room right now, 40-ish people, maybe. So if all of us were diagnosed this afternoon with a DVT or a PE, and we go to our local hospital in New York, a very sophisticated healthcare market, and we end up in the ER, it's likely that 75%-80% of us are gonna be sent home with anticoagulant drugs, and they're gonna say, "You'll be just fine." That's where we are with the market today, so there's a ton of work to do, at the grassroots level to educate the emergency rooms to say, "Hey, before we, before we give people that prescription and send them home, let's ask that question: You know, is this person a good candidate for interventional therapy or not?" So that's kind of the goal of the program-building side there. We believe the evidence that we're developing, basically, the three RCTs on top of the two registries we did, is something that will be extremely helpful to those in the medical community who are looking for randomized clinical trial evidence to, you know, help them feel better, basically about moving more patients, you know, towards the interventional, you know, sort of segment of the pie. And then, hopefully, as I've mentioned earlier, the lytics portion of that pie is going to continue to get smaller, you know, in the future. Okay. So it's kind of both challenges. We're seeing some good success as we move people. We have three phases of this, the VTE Excellence program, we call it, kind of with hospitals that are kind of just kind of starting out. All of our 1,600-1,700 active accounts are a part of this, you know, so we kind of have an effort, and we assess where each hospital is in this progression. But we try to help them build these programs so that they will consider patients for interventional therapy. Many hospitals at the more advanced stage of this will actually hire someone they'll call a VTE coordinator. That person kind of quarterbacks the discussion, if you will, between the emergency room and the interventional suite, to ensure that that question gets asked. Okay. I think in PE, maybe PERTs are the teams that are set up to maybe perhaps shift a greater portion of the patients or refer these greater patients that you talked about, the 80% of patients. Yep T oward interventionalists. Is the VTE coordinator, so, somewhat of what that is in the DVT segment that helps that, and therefore, both of these teams are aware of the oncoming RCT data, and that's how you really drive that- conversion by it. I think we definitely try to work closely with the PERT group in each hospital. The VTE coordinator actually crosses over both DVT and PE, so it works in both disease states to try to facilitate that conversation. Okay. I do wanna move on to new products, international markets, but just last on clinical, the clinical side and VTE, the FLAME trial, high-risk PE, smaller portion of the market, but I think that that was something that, perhaps you talked about is not necessarily driving an inflection, but has been a contributor to growth. Is that something that you've seen maybe accelerating in recent quarters since the data came out and maybe capturing a greater percentage of these higher-risk PE patients? Yeah. The FLAME trial for high-risk PE was completed, and we've been able to make public essentially the results of that trial, basically at a tenfold reduction in mortality. So about with high-risk PE, there's roughly a 28%-30% chance that, you know, within a short period of time, 30-day window, that the patient expires, unfortunately. And when treated with the FlowTriever, the mortality went from that range down to about 2%, so a significant reduction. We're actually expecting the FLAME data to be published in the next couple of weeks. So that's something that'll be out there. That'll continue to sort of be in front of the societies in terms of changing guidelines for high risk. We also think there'll be some spillover benefit, David, for the high risk to intermediate. We've primarily focused on the intermediate population, as you know, but, we think it's kind of the question: Well, wait a second, if it's good to treat high-risk patients with the FlowTriever, then why wouldn't it also be helpful to treat the intermediate patients? Okay. On new products, six new this year, through various stages of their commercialization, limited rollout, limited market release. You know, I know you haven't necessarily broken out the contribution of those products yet. Do you have a sense for when we maybe could start to see a little bit more around how much contribution is coming from these new products? Yeah, I think the... We're excited about the three new products in particular that are producing sort of incremental revenue for the company. And those are the Protrieve product, the InThrill product, and then the RevCore product. Kind of launched in late last year through the present time. All of them are kind of getting us beyond that two-product family that I talked about, kind of at the time of the IPO. And we believe the revenue contributions, you know, although they're modest today, and they're kind of grouped together with the ClotTriever and other category in our financials, we believe those will be significant contributors to the company's growth. And we have other ideas in mind for future products as well, that we'll be announcing in 2024 and thereafter. A couple of those products, for example, the InThrill product, is something focused on the AVF market. So people who are dialysis patients who experience clotting, essentially, with AVF or with the grafts, AV grafts, that product is performing very well, and we're excited about that. The RevCore product is a one-of-a-kind product. It's something designed to clear the clotting that occurs in a venous stent. There are, you know, tens of thousands of stents implanted every year, and some percentage of those become occluded. And so our product is something that's able to go in and basically core out the clot that's in the stent without engaging or disrupting the stent. That's a tricky thing to do. The RevCore is typically used in conjunction with the FlowTriever, the ProTrieve device, so that's an IJ access device. So think of that as coming down here and sort of acting like a catcher's mitt. So the clot that's basically liberated from the venous stent flows upstream and is caught by the ProTrieve device, and then it's able to be withdrawn from the body. So very excited about that product is something that will leave... In terms of breaking out, David, I think we will continue to try to provide some anecdotal commentary about it, and then at some point in time, we'll definitely break that out, as we did earlier this year with the international business. Okay. On to that point, I think you broke out international when it was around 4% of sales. Should we read into that, meaning that maybe none of the combined products together are more than 4% of the sales? Or is that. Not necessarily. Yeah, I think that might be a great question to ask, but I wouldn't tie those together too closely, I guess. Okay. Yeah. Okay, you touched on the three new products, incremental TAMs. Our physician kind of checks have suggested that RevCore maybe is one of the more exciting products, at least from what we've seen. Is that your view, and how do you think about at least the investment in development, market development efforts that you need to have for each of these three products, given that they are new incremental TAMs beyond that of the existing markets? Yeah, I think the RevCore and the ProTrieve don't require much market development at all. They're kind of right in line with the existing call point. They're part of the same disease state, essentially. The occlusion of venous stents is something that is very closely related to DVT. So those are something that kind of fall in line nicely with the existing call points in the cell planner. The InThrill is a little bit different in terms of just kind of dealing with the physicians who tend to specialize in treating patients that have the clotting, essentially, according to their dialysis access ports. So that's a little different. Another area of difference for a product that we haven't touched on yet, which is the RevCore device, is actually also paired with the ClotTriever BOLD. So ClotTriever BOLD can be used for the clot, essentially in the thigh. It's also part of this product family we're developing to address chronic venous disease. That's about a billion-dollar TAM, so that's one of the new TAMs that we've invested in. We have some other products coming in 2024 to sort of fill out the toolkit for chronic venous. That is an area of, a sort of, a, a wider area of sort of focus for us from a sales call point, point of view, and we've actually hired some folks we call therapy development specialists. And so they're calling now on wound care clinics, they're calling on podiatry offices and other, folks who are- they're involved in the treatment pathway for chronic venous disease, and that's an area that we've still got to learn more about. Okay. Maybe we can move this into talking about profitability, but when you add in more of these products into the bag, is that what may be the bigger driver of improving profit is by having cross-selling opportunities? Can you just touch on that aspect of bringing more products into the bag and the, you know, leverage you've seen in the model based on now- Yeah H aving more than just, you know, two core products? Yeah, we're seeing some very positive and encouraging, you know, operating leverage in the business in 2023 compared to 2022. Quick reminder, we were actually operating profitable in 2020 and 2021, so I'd like to say we were profitable before it became popular. But we're kind of returning to that. As we talked at our Analyst Day in a year ago, we're planning to return to operating profitability in the first half of 2024. We came really, really close to that in Q2, just a $1.5 million operating loss, and so close to breakeven there. We had a net income profit in Q2, and so we may be a little bit ahead of schedule there in terms of our progress towards operating profitability. I think it's been driven by probably three factors. You know, the growth of the top line, obviously, the company's had a very high gross margin, 88% in Q2. We've guided towards sort of a mid-80s% gross margin, so I don't know, 84, 85%, longer term for the business, so that's something that helps us a lot. And then we've been able to kind of level our spending in the R&D part of the company in terms of clinical and product development, and also in the infrastructure side of the company. So think about the SG&A, think about the G&A part. We feel like we've got a pretty good platform in place there to support future growth. We are still investing on the S side, so the sales side, but at a slower pace than we did in 2022. So that's... All of those things kind of taken together are helping us on that journey. Okay. So, I think first half of 2024, operating profitability, that's operating, operating income, not adjusted EBITDA, right? Operating income. Okay. Right. Longer term, right, you have new products. We haven't gotten into international yet, and we're gonna try to do that in the last two minutes. But investing in international markets, how does the longer-term profit profile of the company look as you progress through each of these different. Yeah K ind of growth phases? We're seeing the profit sort of journey of the company in three phases. So the initial phase, as David just mentioned, is the first half of 2024. Phase II would probably be to reach a low double-digit level of profitability. So think like a 10%-12-ish% operating profit. That could happen not that long thereafter, and I think we'd intentionally pause at that level, because of the ongoing investments in the, at that point in time, the two randomized clinical trials and the ongoing investments outside the U.S. Just significant investments in those markets to kind of get them to where we think they want to be. Lots of program building to do outside the U.S., as we're doing here in the U.S. So the phase II is sort of a low double-digit of operating profitability, and I think the long term for operating profits is a 20%+, you know, business. So that's kind of the way we think about the operating profit transition we'll go through over time. Okay. Less than a minute, we're gonna go right through into international. Just anything you wanna call out there, I mean, that's a bigger growth driver or anything, catalyst to watch out for beyond 2023, and then if you can squeeze it in, any thoughts on GLP-1s? Sure. Real quick on GLP-1s, obesity, a secondary risk factor for VTE. The primary risk factors are things like orthopedic, you know, surgery, cancer, genetics, you know, various other. I mean, all kinds of things from oral contraceptives to, you know, maternity and those kinds of things. So those are the primary drivers. So GLP-1s is unlikely to have any effect on VTE. Internationally, I think the catalysts that we're looking for in 2024, ongoing progress from Europe and these other markets we're in right now, but we hope to have some news to share before the end of the year on Japan and China in terms of our go-to-market plans for those two markets, and those will be significant opportunities for us. Okay. Longer term, I think maybe you've said, as a percentage of sales, where international goes? We're shooting for 20%+ in terms of the total company revenue coming from outside the U.S., so very excited about that. Thanks for being here today. We really appreciate it, appreciate your support of the company. Thank you. Thank you for having me, David. Yeah. Thank you.