Cardiovascular Systems Inc (CSII) 2014 Q3 法說會逐字稿

Good day ladies and gentlemen and welcome to the Third Quarter 2014 Cardiovascular Systems Incorporated Earnings Conference Call. My name is Kim, and I will be your operator for today. At this time all participants are in a listen-only mode. Later we will conduct a question-and-answer session. (Operator Instructions) As a reminder, this conference is being recorded for replay purposes.

I would now like to turn the conference over to your host for today, Mr. Larry Betterley, Chief Financial Officer. Please proceed.

Thank you, Kim. Good afternoon and welcome to our fiscal 2014 third quarter conference call. During this call, we'll make forward-looking statements. These forward-looking statements are covered under the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995 and include statements regarding CSI's future financial and operating results or other statements that are not historical facts.

Actual results could differ materially from those stated or implied by our forward-looking statements due to certain risks and uncertainties, including those described in our most recent Form 10-K and subsequent quarterly reports on Form 10-Q. CSI disclaims any duty to update or revise our forward-looking statements as a result of new information, future events, developments or otherwise. We'll also refer to non-GAAP measures because we believe they provide useful information for our investors. Today's news release contains a reconciliation table to GAAP results.

I'll now turn the call over to Dave Martin, CSI's President and CEO. Dave?

Thanks, Larry. Hi, everybody. Our third quarter was very successful for CSI, our physician users and the patients they serve. We continued to expand our $4 billion vascular market. Increased usage of our current products and the introduction of new products led third quarter revenues to record levels. Revenues rose 32% year over year and 6% sequentially from the second quarter of this fiscal year. Our newly introduced coronary product is growing significantly.

On the peripheral side of our business, physicians continued to increase usage of our Diamondback 360 system. This was the primary driver of third-quarter revenue growth. In addition, we received FDA clearance for our new Low Profile 60 centimeter 4 French device. This device expands the number of patients in need that can be reached and relieved by providing physicians with broader treatment options for lower-leg lesions.

On the coronary front, the launch of our system is progressing very well with more than 400 patients treated, generating an additional $1.7 million of third-quarter revenue. With a dedicated team of about 20 coronary sales specialists, we are focusing on a select number of top medical institutions in the United States. We are executing a controlled commercial launch of our Diamondback 360 Coronary Orbital Atherectomy System.

Since the launch began in late October 2013, more than 100 physicians in over 30 key institutions have treated more than 500 patients using our unique technology. Our technology is the first and the only device specifically approved to treat severe coronary calcium disease. Our technology is established in prestigious institutions such as Mt. Sinai, New York; Columbia Presbyterian, New York; and Duke University Hospital among others. Prominent physicians are achieving excellent procedural success and outcomes and those outcomes are consistent with our ORBIT I and our ORBIT II results in this large patient population.

A few physician quotes, including Dr. Jeff Moses from Columbia Hospital New York who said, "I have never seen a dramatic change with coronary atherectomy, this is impressive." And Dr. Art Lee from North Florida Regional Medical Center said, "we are able to do cases that we would not have done before." Comments like these and others that we are getting from the field give us optimism for strong adoption in the future.

As we close out this fiscal year, our goals remain consistent, to expand the use of our orbital atherectomy system as the primary therapy for treating calcified arteries in the PAD market, both above and below the knee and that includes those patients who are at risk for amputation, continue a successful targeted coronary rollout, build on our base of scientific data that supports safety, effectiveness and economic benefits of our products and further enhance and expand our product offering.

Now Larry will provide more details on our financial results and then I will come back to recap clinical and research activity before we take the questions.

Thanks, Dave. CSI performed well in the third quarter. Compared to a year ago, total revenues grew 32% to $34.9 million which exceeded our guidance range. Device revenues were 88% of the total. We sold nearly 10,000 devices during the life to-date total sold to more than 146,000. Devices sold included 460 coronary units. Coronary revenue also exceeded expectations totaling $1.7 million.

Reorder revenues remained high at 96% of total revenue consistent with last year. We added 46 new PAD accounts and 22 coronary accounts, all of which are also PAD customers. Other product revenues rose 22% from the prior-year quarter to $4.1 million driven our overall procedure growth.

Gross profit margin increased to 78% from 76% in the prior year. The gain was driven by product cost improvements and higher production volumes. We expect engineering enhancements and increased production volumes to continue to reduce unit costs.

Operating expenses rose 43% over last year, primarily from planned investments, including approximately $10.3 million related to the coronary commercial launch, studies and the product development. We also made investments in sales and marketing, expanded clinical and product development initiatives and medical education programs to continue to drive PAD adoption. All of these investments are geared towards generating higher future revenues.

Net other expense totaled $119,000 versus $809,000 in the prior year. The decrease was mainly due to lower debt levels this year and charges from debt conversions last year. Net loss was $9.7 million or $0.32 per share and compares to a loss of $6.2 million or $0.29 per share last year. The number of weighted average shares outstanding rose to 30.4 million from 21.5 million last year. This was due to the issuance of 5.3 million shares in our March and November 2013 stock offerings as well as the issuance of stock from debt conversions, employee stock plans and warrant exercises. All of our warrants have now been exercised or have expired.

Adjusted EBITDA was a loss of $6.4 million compared to a loss of $3.3 million last year. The increase was from a larger operating loss partially offset by higher stock compensation expense. Excluding a loss of approximately $9 million related to our coronary launch, adjusted EBITDA for our PAD business was positive for the quarter.

Our cash balance was $146 million at quarter end. We raised approximately $84.4 million of net proceeds in our November 2013 public stock offering. Proceeds are being used primarily to fund growth investments, including coronary launch initiatives, clinical studies, product portfolio expansion, education programs, international expansion and future capacity requirements.

Today's press release also contains our nine-month performance data and I won't discuss that in my prepared remarks but will be happy to answer your questions during Q&A.

Now I'll turn it back to Dave for further commentary.

Thanks, Larry. As we look at our coronary market, it's estimated that calcium is present in nearly 40% of those patients undergoing coronary intervention. Scientific and patient data inform us that calcium contributes to higher treatment costs and poor outcomes when traditional therapies are used.

Outcomes from the use of traditional therapies include a significantly higher occurrence of death and major adverse cardiac events. Calcium is a large and vastly underestimated problem in medicine with limited options for treatment. Once the FDA approved our technology, CSI was able to bring the first new coronary atherectomy device to market in more than 20 years. Ours is the only device approved to treat severe calcium.

In February, at the 2014 Cardiovascular Research Technologies Conference, we released the one-year results from our ORBIT II study. The ORBIT II study evaluated the Diamondback 360's effectiveness in treating severely calcified lesions. At the conference, Dr. Jeff Chambers of Metropolitan Heart Institute in Minneapolis described superior rates of freedom from adverse events of 84% and freedom from lesion retreatment of 95%. These are groundbreaking results when compared to historical data for this difficult-to-treat patient population.

Patients treated with the Diamondback 360 technology experienced shorter procedure times, shorter hospital stay lengths and lower re-admission rates. The estimated cost savings is in excess of $4,000 per patient. These are compelling proof points supporting our plans for future adoption and revenue growth for this coronary device.

Looking at peripheral, the FDA approved our new 60 centimeter peripheral device for the treatment of peripheral vascular disease. This clearance expands options for treating challenging blockages in lower leg arteries. These blockages are often associated with Critical Limb Ischemia, or CLI. CLI causes severe pain and non-healing wounds, which left untreated often result in amputation. There are 2 million CLI patients in the U.S. alone and about 160,000 amputations are done each year in the United States as a result of the disease. Almost half are major amputations with procedure and rehabilitation costs of nearly $100,000 in just year one. In addition, life expectancy for the majority of patients receiving major amputation is only two years.

Dr. Mustapha of Metro Health Hospital, Michigan was able to almost eliminate major amputations in his facility by treating lesions below the knee using our device.

He took 116 amputations annually just a few years back down to nearly 0. Dr. Sharma in New York had a similar and dramatic result in his New York institution. In a great way we can replicate this across the United States and I believe it's inevitable that a major hospital chain will take on this new protocol and our tool in order to eliminate amputation.

Our new 60 centimeter Diamondback devices are compatible with 4 French introducer sheaths. The use of smaller sheaths has been shown to reduce procedural and access site closer times. It's also associated with lower radiation exposure and enable us quicker patient recovery with fewer procedural complications from bleeding thereby providing benefit both to the patient, physician and staff.

More than 12 million Americans suffer from PAD. Approximately 25% of these individuals will progress to CLI, which is associated with difficult and complex blockages in the tibial arteries. The tibial arteries are the arteries responsible for supplying blood flow to the foot. It is estimated that up to 20% of these occlusions can't be treated from traditional methods. Our new 60 centimeter device and the techniques that go with that device allow the use of retrograde tibiopedal access. This is a different option for the patient, an option where physicians achieve access through arteries in the foot or the ankle. This is new and significantly expands treatment options available for patients in need.

On the clinical side, we continue enrollment in Liberty 360. This study is evaluating the acute and long-term clinical and economic outcomes of our Orbital Atherectomy Systems in treating PAD. It's the first study of its kind to compare Orbital Atherectomy to all other PAD interventional treatment options. Nearly 200 patients have been enrolled to date and we expect enrollment to continue to accelerate as more sites complete their internal review board processes.

Now I'll detail our financial outlook for fiscal 2014 fourth quarter ending June 30, 2014. We anticipate revenue to be in the range of $36.3 million to $37.8 million representing year-over-year growth of 26% to 31%.

This includes approximately $2.5 million to $3 million of revenue from our controlled coronary launch and PAD revenue growth of 17% to 21% from last year's third quarter. CSI's gross profit as a percentage of revenue should be consistent with the third quarter of fiscal 2014. We anticipate operating expenses approximately 2% higher than the third quarter of fiscal 2014 primarily for additional coronary investments.

The resulting net loss is expected to be in the range of $8.4 million to $9.3 million, or $0.27 to $0.30 loss per common share. This assumes 31.3 million average shares outstanding.

In closing, I want to emphasize that our market-expanding Orbital Atherectomy Systems consistently provide safe and effective outcomes even in the most difficult to treat patient populations, including those with significantly calcified lesions and those suffering with Critical Limb Ischemia facing possible amputation.

We expect these unique capabilities to expand the coronary and peripheral markets and spread adoption of our systems providing continued attractive growth for CSI well into the future.

Now I'll turn the call back to the operator for questions.

(Operator Instructions) Danielle Antalffy, Leerink Partners.

Good afternoon, guys. Thanks so much for taking that question and congrats on a really solid quarter. I wanted to ask, so just looking at your coronary utilization versus PAD, it's significantly higher and coming out to around 20 per account or so. And I guess I was just wondering with your PAD utilization more in the mid-single digit range per account, is there something unique about the coronary that pushes it that much higher? Is that a sustainable sort of utilization level? Is there some trialing going on? Can you help explain the discrepancy there and how sustainable that is for coronary?

Yes. We're excited about the coronary results. Thanks for the compliments Danielle and really a great question. There is a critical need. So I think you're seeing need-based usage. It's been a real problem, severe calcium in the coronary arteries. We are going to the top institutions, they have seen this need for a long time. And when they see how easy to use our device and all of the associated benefits, we're getting some great uptake.

Also, because of the ease of use and the safety of this device, we're going deep into the physician groups. It's not a specialty item where just one or two physicians per hospital can use the device. In fact, now every physician can keep these patients and treat them safely and routinely now that they've got the right tool.

On the peripheral side, we continue to see exciting growth, particularly as we awaken those physicians who without our tool couldn't routinely treat those three tibial arteries that are on each side, that are critical to feeding the foot and we believe it's proving out to be essential for a great clinical and economic outcome. And the more we turn on physicians to treating those vessels, we get extraordinary results like we just talked about Dr. Mustapha who took 116 amputations in one year at Metro Health Center in Michigan down to nearly 0 last year and I talked to him today. He said "the only difference, David, was that we treated tibial arteries and we used your device." And that can be replicated, we're very excited about that.

So I think we'll see continued market expansion with this tool, particularly in the lower extremities and I think we'll see story after story come out of the institutions to install new protocol and use our new device to get these extraordinary results.

This is Larry, Danielle. The other thing I'd like to point out is that a lot of our coronary accounts are just getting up and running. So we feel pretty optimistic about our ability to sustain high usage in accounts going forward.

Right. And if I could follow -- thank you for that you guys, if I could follow up on the coronary, you gave great color on the reorder revenue. I think that's a combined number just for PAD, 96%. What percentage of coronary revenue was reorder revenue this quarter? Can you give that number?

Yes, I can. I can dig that out. It will be a little less for coronary because we are opening obviously a high number of new accounts, but that is a combined number. I'll find that for you and disclose it shortly.

Ben Andrew, William Blair.

A few questions for me. Starting with the kind of training opportunity and what you're seeing in terms of physician behavior and the types of cases they are going after, you've obviously had good success here with the early launch. Does it involve you to kind of accelerate the efforts in the short term or is this going to remain steady? And you can think of -- maybe just talk a little bit about the approach here in next one to two quarters?

Thanks, Ben for the question. We will stay disciplined. The biggest feel-good for us and for the physicians is the initial commercial experience produced a result that was exactly like our fantastic ORBIT I results and our ORBIT II results and we want to stay right there. The training is expensive. When we get to an account, we really take our time to go over historically all of the key learnings, both data and procedural to support the entire staff in hospital, not just the physician and we provide partnership and peer-to-peer contact as well. It's been a great recipe and we're going to stick with it.

Okay. Are the clinicians, when they're treating these patients, a lot of these calcified lesions require surgery. Are they pulling patients away from surgery that they can now treat that they wouldn't otherwise have confidence to do or give us a sense of the mix you're seeing?

Yes, it's a great question and I ask it all the time. Anecdotally, from the early set of physician's practices, the number is 20%. 20% of the patients either couldn't be treated or would have gone to surgery that are being treated now in just a few minutes with less than 60 seconds of sanding with our Diamondback device.

Other than the ORBIT II follow-up data, are you guys doing any kind of registry work with those patients to collect the overall cost because I think there is a pretty good economic argument to be made longer term for the product if you are going to surgery?

You bet, it's absolutely necessary for people to know what the economic outcomes are with the outpatient populations, but we've already got information that shows that we can save the institution $4,000 per patient. Those numbers came from a retrospective look by Dr. Jeff Stone and his 14,000 patient database. In addition, and inspired by that information, we've got an adverse event study ongoing right now. I think we're approaching 200 patients enrolled and that's to confirm that result, but in a forward prospective way what happens to those patients with coronary calcium, what's the outcome, both clinically and economically and we're enrolling those as we speak. We think that will be a very important study.

In addition, we're going to let that ORBIT II age and year one, those exciting results came out at the CRT meeting just a couple of months ago and are providing a lot of confidence to our physician users and prospective physician users. But we'll let that age, we're excited to get year two out. I believe we've got some economic data coming out from ORBIT II in just the upcoming months. I believe one of the main meetings will have economic year one data from ORBIT II that will be supportive as well.

Okay. Thank you. A couple of quick number of questions for me. The 460 units, was that usage or is that sales in the quarter and is it $1.7 million in revenues or $1.585 million in coronary?

The 460 is sales but that's close to the usage number as well. And the $1.7 million includes some of our ancillary product that goes with the device sales. The other number you referenced is just the device revenue.

Got it. And obviously the other revenue, I guess ancillary revenue has been doing very well and roughly tracking your volumes. What's your opportunity there for pocket share either with product you've got in-house already or things that you're thinking about adding to the portfolio?

So there are opportunities there. It's been pretty consistent, as you know, around 12% of revenue. Just a little lower this quarter. The coronary doesn't use the full set of ancillary but there's definitely potential to add things to the bag in the future though right now we're prioritized to close our opportunities in coronary in our below the knee product introductions.

Okay. Thank you very much.

And in response to Danielle's question earlier, the order revenue percentage for coronary is 84% and for peripheral, it was 97% for an overall average of 96%.

Jose Haresco, JMP Securities.

I guess first question is for Larry. I think when you talked to us about again buying patterns, are there a lot of talks being going on in the new accounts that you have or are people kind of ordering on a quarterly basis, on a weekly basis. I am just trying to get a sense of kind of the early adoption behavior for accounts you are opening versus the ones you've already got?

Yes, I think that's a good question, Jose. I think we've got a very good cadence to our sales and we don't see -- while at the end of the quarter, it's higher. We see very good cadence throughout the quarter. So it isn't dependent on a lot of stocking orders at the end. There are some accounts that ordered quarterly but it's much lower and has been dropping as a percentage of sales for the quarter for the last few quarters. So it's more of a consistent stream of sales.

As you guys think about your forward guidance, if I'm not mistaken, it looks like you went from 20 accounts at the end of the December quarter to 30 accounts at the end of the March quarter. Is that a pretty typical cadence about adding 10 kind of new stores to the coronary base every quarter? Is that how we should think about that patient?

It's probably a little late. We go at -- when we look at where we were, we were at 11 at the end of December. You might have been referencing the January number which we also disclosed last time. So, we added 22 new accounts this quarter. That's probably not a bad rate. We're not really driving that. We haven't given a quota to those sales reps. We are more focused on, as we've said before, those top 75 accounts, getting multiple physicians in those accounts and driving adoption. So the last quarter wasn't the bad number. I think it was a pretty good number for introduction though we are going to focus on those 75 and not necessarily grow broader in that first year.

Okay. And I guess as you think about your guidance going forward, which is surprisingly good, is that largely a function of -- I guess you can put out the impact of going deep within certain accounts as opposed to opening new accounts. How do you think about those two as you look ahead?

Well going deep in is the strategy, no doubt, and we could drive more quality allowing us to get the optimal patient outcomes, both in our late procedures, a lot of which are new to the physicians who did not learn as a matter of routine to treat below the knee, but we know how important it is for outcomes both economic and clinical for them to treat routinely down there. Going deep, staying home, sharing that scientific data, doing the medical education training that we are so dedicated to doing in the peripheral, as well as the coronary will further our reputation for being science oriented and outcomes oriented. So we'll continue to go deep.

Okay. I guess last question, do you have a sense of what share you might be taking of cases from Rotoblader?

No, we don't measure share a whole lot. We're really focused on disease state and we are absolutely expanding the market. We're bringing patients into the treatment queue that couldn't be treated, both on the peripheral and coronary side, patients who had no other option, but for our device, and were brought back to the hospital and treated. We are hearing stories like that weekly.

A couple of exciting stories on the peripheral side, with our 60-centimeter tibial pedal device. There was a patient who had end stage leg disease that two weeks before was sent home basically with a sentence for amputation or death if left untreated. And they were brought back and Dr. Mustapha was able to treat that patient in less than half an hour. He treated multiple vessels. He did it with less than four minutes of radiation exposure time, which is unbelievably less, 500% less than what would be in a typical case. And they closed up that little tiny puncture wound with a little bit of finger pressure and that patient had extraordinary results. You can imagine that patient going home and the family and the joy of the staff and Dr. Mustapha.

So that's just one example of market expansion and I think on both sides, coronary and peripheral, that's where we're headed.

Okay. I guess lastly, anything new at EuroPCR that we ought to be expecting?

We'll be there. Our economic results for ORBIT II will be presented and I think there will be continued interesting presentations overall regarding the prevalence of calcium, the difficulty in cost and complication with calcium. Dr. Tepe has been presenting and you may have seen that he presented recently about, we're all excited about, drug coated balloon technology, but the number one predictor for drug-coated balloons failure as presented by Dr. Tepe was the presence of calcium. And he said some really compelling things that he'll be talking about at EuroPCR and beyond that calcium may decrease drug penetration, the prevalence overall of calcium is increasing with the aging population, that pre-treating a vessel with atherectomy he believes may improve drug therapies and expand the market of patients who can benefit from them. And we agree, our device is extraordinary at leaving the native artery intact but taking out the most complicating factor, calcium and what you have left after a few seconds of sanding is a smooth tubular aluminum.

Thanks very much and congratulations on the quarter.

Thanks, Jose.

(Operator Instructions) Ben Haynor, Feltl and Company.

I know in the past you've talked about once you gain the coronary approval that you may think about taking both devices outside the U.S. Just wondering if you could offer any update on plans there, how soon we might be able to expect that?

Yes, great question, Ben. Thanks for that. We've been really aggressively doing all the pre-work to lay the foundation for that. We've been working closely with the Ministry over in Japan looking for fast track opportunities and we really think we're on a great path there. And then in Europe and we've identified some select markets where we'll do a controlled launch. Right now it is kind of building the foundation bricks.

We'll need to get our CE mark. The great news is that we'll be able to go with our best technologies over there now that we just had the great news with the coronary device and the great success with that. Now that we've got improved and new peripheral devices, we are very excited to get international and help those patients in need.

We are probably a year out from revenue while we do the brick building so to speak, but we're on track and aggressively pursuing.

Thanks. That's very helpful. And then this is kind of a weird question to ask, I suppose. With the solid quarter that you had, but do you think it was impacted by weather at all and maybe could have even been a little bit better?

I don't think so. I think patients in need, especially some of the patients who are end-stage disease like we treat, they get themselves to the hospital or to the doctor's office. So we didn't see weather as a factor.

Brad Mas, Needham & Company.

This is Brad filling in for Mike. Just back to the drug coated balloon, I was wondering if I could get your thoughts on the Medtronic trial results? And if it changes your view at all of the DCBs on the peripheral atherectomy market?

Well, we're excited by the resources in this space. As you know historically outcomes for peripheral intervention have been chaotic. You don't have to look past those 160,000 amputations, the surgeries and the massive use of things in the SFA but the absence of use of things in those critical outflow vessels. Previous to the Diamondback the tools that the doctor had available weren't going where the disease went. And so in fact you had a lot of spot welding and treating just where you could get and the clinical and economic outcomes showed that they were poor overall.

I think new investment, new dollars, new attention, the advent of and drug therapies in this space will be great. I think it will be a marked expansion play and I think for -- we are all hoping for the drugs to produce a good result. And we saw Medtronic's PCB study in SFA and some of the patency rates. They could benefit -- those patients with calcium could benefit from being cleaned out before that. So I think we can make that good product go a longer way for more patients, and we'll see how it works out. We're doing great work below the knee. We would be hopeful that there will be an opportunity for drug to contribute down there as well. We're taking a close look at our role. Our role will be the primary. We are going to clean up that vessels first and leave that native artery hopefully intact, that's the way to start a case and then adjunctively a patient can benefit from drug therapy, I think, it'll be great. I'd like to think that in year two or three that the whole category one is much larger and two has dramatically different patient outcomes.

And then just one number question. I think I missed the fourth quarter outlook for the coronary revenue, was it $2.5 million to $3 million?

That's correct. All in revenue of $2.5 million to $3 million.

Jan Wald, Benchmark Company.

A lot of my questions have been asked, but -- so let me begin by asking about the coronary launch and I guess there's an expectation on my part and I don't know how widespread this is but there is eventually going to be something like a hockey stick when you unleash the hounds, if you will and you start the controlled launch, there's going to be something like an inflection point. One, is that correct and two, when do you think we should see something like that happen?

Thanks for the question. We don't see it as a hockey stick. We are really sticking to our knitting so to speak, one institution at a time. We've already seen great uptake on a per institution basis. It is a coronary procedure. We are really protective of our results and concerned about patient outcomes and a great physician experience. So I think we're going to stay with this controlled launch. We've got a great medical education program. We're growing the number of faculty by the week. We have a stronger and stronger podium presence as we get key opinion leaders involved. So there won't be any need to un-gate this. I think we will continue in our measured way with patient outcomes as a focus and that'll be the proof point that will allow us to be a great long-term technology play for patients in need.

Jan, I think what you're probably referring to is us broadening out the sales effort to our peripheral sales organization. We call 70% on interventional cardiologists today and we're just starting to train those people and we're going to broaden that out for fiscal 2015, but it still be a staged process. We're not going to open it up all at once. It's going to be training folks in groups and rolling that out with very extensive training for those PAD sales folks and also certifying the physicians. So while the revenue growth will accelerate, it won't hockey stick because of that staged approach.

And I guess the 60 centimeter peripheral device, it was great to hear that anecdote but do you have a feel or can you quantify the number of patients that you're going to gain from having a small device or is this something that is just sort of an ease of use type of thing that will allow doctors to feel better about the things they're doing to some patients but not appreciable -- not more patients?

That's a really good question. It will definitely expand the market. There's a couple of million patients in the US with CLI that are basically on the sidelines with no solutions. This is the solution for those patients. And then every year with the growing incidence of the disease because of the aging population, increased incidents of diabetes and obesity, there are right now and growing 2.5 million new patients properly diagnosed with peripheral vascular disease. Of those 1.9 million are treated, they are kind of on the wait and see. So the market is enormous and the gat, has been a technology gate. The inability to routinely and safely treat below the knee and I can't emphasize how critical those three tibial arteries are. They are there for a reason that provide blood flow to the foot. And previous to our device, they could not be treated routinely; now they can. There are a number of proved sources, including we mentioned Dr. Mustapha earlier. But one of the studies he did was, he headed off 32 planned amputations in a row by treating the tibial arteries that feed blood to foot and those patients did not have those planned amputations. Two legs, one heart, I would argue that the leg market is way bigger than the coronary market. So I think we've got a lot of work to do for years to come.

I guess the cost analysis that was done was impressive and you showed a $4,000 reduction per hospital visit. The cost reduction is not the same as cost effectiveness. And do you have a plan to do something to prove cost effectiveness of the device?

You bet, both in the peripheral space and the coronary space. And all of our studies will feature it, both economic and clinical tracking. Liberty, for example, does exactly that. So we will have a cost effectiveness rating or that we set that up to track both clinical and economic and those studies aging will get us to the compelling proof points that everyone is looking for. And we're very bullish on what that's going to look like.

Do you have a sense of when those studies will -- when the data will be ready and published? Is it a year from now?

ORBIT I -- I mean, ORBIT II year one, we've got economic data coming out in the next 60 to 90 days, and then we'll continue to age and produce it every year. Liberty 360, which is a prospective core lab adjudicated study, we've got approaching or maybe a little bit more than 200 patients enrolled in that and we are actually wide open for presenting. So I would expect that some of the participating physicians will start presenting that data in the fall. And then that will be open for a continuous stream of presentations. So it's coming and the early news is compelling. And that $4,000 per patient on the coronary side savings is I think getting better and better as patients avoid re-treatment which is the biggest expense to the system.

Yes, [let's wait for what] cost effectiveness would be, something that would be really something to prove. And I guess the last question I'll ask, what kind of data will we be seeing over the next year or so. You've outlined at least what we're going to see in terms of cost data, but I'd expect we'll one year and three year data from the trials that you've had as well. Is there anything else?

No, that's it. We've got the adverse events or MACE study, we've got ORBIT II aging -- ORBIT I and we've got a presentation coming up with five-year data on that. The Liberty 360, we'll enroll that, two and three or thousand patients and we've got some key institutions involved in that. So we've got a full plate and we'll track clinical and economic data. So you'll see some from us at almost every meeting.

That concludes our question-and-answer session. I will now turn the call back to Mr. Dave Martin.

Thanks everybody for joining us today. We're pleased by our progress this year as we continue to advance our technology on both the peripheral and coronary front. As a company, we're committed to helping physicians conquer the most difficult disease states including arterial calcium given the complications it presents for the millions who suffer from PAD and CAD. We look forward to updating you next quarter. And thanks to everyone, including our hardworking CSI employees. Thank you very much.