CVRx Inc (CVRX) 2021 Q4 法說會逐字稿

Ladies and gentlemen, thank you for standing by, and welcome to the CVRx Q4 2021 Earnings Conference Call. (Operator Instructions)

I would now like to turn the conference over to your speaker for today, Mike Vallie, you may begin.

Good afternoon, and thank you for joining us today for CVRx' Fourth Quarter and Full Year 2021 Earnings Conference Call. Joining me on today's call are the company's President and Chief Executive Officer, Nadim Yared; and its Chief Financial Officer, Jared Oasheim.

The remarks today will contain forward-looking statements, including statements about financial guidance. The statements are based on plans and expectations as of today, which may change over time. In addition, actual results could differ materially due to a number of risks and uncertainties, including those identified in the earnings release issued prior to this call and in the company's SEC filings, including the upcoming Form 10-K that will be filed with the SEC.

I would now like to turn the call over to CVRx' President and Chief Executive Officer, Nadim Yared.

Thank you, Mike, and thank you, everyone, for joining us this afternoon. I'll begin by providing an overview of our fourth quarter and full year performance, followed by an operational update. And our CFO, Jared Oasheim, will then review our financial results, and I will conclude with our thoughts for 2022 before turning to Q&A.

We are very proud of everything that our team accomplished in 2021, taking into consideration the material headwinds caused by COVID-19 in the U.S. and in Germany. In 2021, we more than doubled our worldwide revenue, delivering full year growth of 115% driven primarily by our U.S. heart failure business that grew more than 750%. We also made progress towards our strategic initiatives, including the first patient implanted with the help of our new ultrasound-guided implant tool kits.

In the fourth quarter, total revenue was $3.7 million, which fell short of our expectations, primarily due to COVID-related headwinds in Europe. Despite this impact, we saw an increase of approximately 75% over the fourth quarter of 2020. This significant year-over-year growth in the quarter highlights the resilience seen in our U.S. heart failure business.

Turning now to an operational update. First, I wanted to give you a quick update on hiring. We added over 50 new employees in 2021, bringing the total to over 100 employee worldwide. Being able to more than double the size of the organization by bringing in top talent in a tough hiring environment is a testament to the excitement in the industry for Barostim and the opportunity that lies ahead. Of the new hires, 2 were for senior management, including our Chief Marketing Officer and our European VP of Sales and Marketing.

As part of that hiring, we continued the expansion of our commercial infrastructure. As planned, we added 3 U.S. territories in the fourth quarter, bringing the total to 14 in by the end of the year. Recall, we began the year with 6 sales territories, and we are very pleased with our ability to train these reps and launch them into the field throughout the year despite the disruption from COVID-19.

We also made progress with 2 early commercial initiatives during the year: first, we launched a direct-to-consumer marketing pilot program; and second, we created an internal prior authorization team. Both initiatives have seen early success, and our initial experience has allowed us to optimize these programs. Given the traction we have seen thus far, we expect to expand both initiatives in 2022 to support the adoption of Barostim, which I will discuss in greater detail later in the call.

Another area of focus for us during the year was product portfolio innovation. As we mentioned last quarter, we recently submitted 3 PMA supplements to the FDA. The first was for Barostim MRI conditional labeling, the second was for our new implantable pulse generator and the third was for our new programmer. We are pleased to announce that we received approval for our new implantable pulse generator in December 2021. This new IPG is smaller in size than prior generation and has 20% longer battery life on average. We are expecting approval of the new programmer in the first half of 2022 and then plan to launch the new platform commercially.

We are encouraged by the accomplishments during 2021. As a result of the successful launch of Barostim for heart failure in the United States and the expansion of our commercial organization, we more than doubled our revenue. Despite the COVID-19 overhang that has continued into 2022, we are confident in our ability to grow the business and continue the adoption of Barostim to bring relief to patients suffering with cardiovascular illness.

And now I would like to turn the call over to Jared for a financial review.

Thanks, Nadim. Total revenue generated in the fourth quarter was $3.7 million, which is an increase of $1.6 million or 75% when compared to the same period last year.

Revenue generated in the U.S. was $2.9 million in the current quarter, which is an increase of 244% over the same period last year. Heart failure revenue in the U.S. totaled $2.7 million in the current quarter on a total of 95 revenue units as compared to $607,000 in the fourth quarter of last year on 21 revenue units. The increase was primarily driven by continued growth in the U.S. heart failure business as a result of the expansion into new sales territories, new accounts and increased physician and patient awareness of Barostim.

At the end of the current quarter, we had a total of 46 active implanting centers compared to 38 on September 30, 2021, and 11 on December 31, 2020. At the end of the current quarter, we had a total of 14 sales territories in the U.S. compared to 11 on September 30, 2021, and 6 on December 31, 2020.

Revenue generated in Europe was $800,000 in the current quarter, which is a decrease of 36% when compared to the same period last year. Total revenue units in Europe decreased from 55 in Q4 2020 to 39 in the current quarter. The decrease is due to the COVID-related headwinds in Germany in December 2021. The number of sales territories in Europe remained consistent at 6 during the current quarter.

Gross profit was $2.7 million for the current quarter, which is an increase of $1 million over the same period last year. Gross margin decreased to 73% for the current quarter compared to 78% for the same period last year. Gross margin in the current quarter was lower due to a larger percentage of our revenue units coming from full systems versus battery replacements for existing patients. New patients receive a full system that includes an IPG and a stimulation lead and have a lower gross margin than a stand-alone IPG used for a battery replacement. This was partially offset by an increase in our average selling price.

Research and development expenses were $1.8 million for the current quarter, which is an increase of $1.3 million when compared to the same period last year. This change was primarily driven by an increase in clinical study expenses due to a $1 million nonrecurring reduction in a clinical accrual in the fourth quarter of 2020. Additionally, this increase was driven by a $200,000 increase in compensation expenses as a result of increased headcount and a $100,000 increase in noncash stock-based compensation expense.

SG&A expenses were $9.7 million for the current quarter, which is an increase of $6.4 million when compared to the same period last year. This was driven by an increase of $3 million in compensation expenses as a result of increased headcount; a $1.2 million increase in marketing and advertising expenses primarily related to the commercialization of Barostim in the U.S.; a $600,000 increase in noncash stock-based compensation expense; a $700,000 increase related to D&O insurance costs incurred as a result of becoming a public company; and a $500,000 increase in travel expenses.

Other expense net was $1.4 million for the current quarter compared to $632,000 for Q4 2020. The expense in the fourth quarter of 2021 was primarily driven by a $1.3 million loss on debt extinguishment in connection with the repayment of our outstanding debt under the Horizon loan agreement. The expense in the fourth quarter of 2020 was primarily driven by the increase in the fair value of the convertible preferred stock warrant liability.

Net loss was $10.6 million or $0.52 per share for the current quarter as compared to a net loss of $3.4 million or $10.04 per share for the same period last year. Net loss per share was based on approximately 20,367,000 weighted average shares outstanding for the current quarter and approximately 360,400 weighted average shares outstanding for the fourth quarter of 2020.

Turning to a balance sheet update. At the end of the current quarter, cash and cash equivalents were $142.1 million, Net cash used in operating and investing activities was $7.6 million for the current quarter compared to $4.2 million for the same period last year. The primary driver for this change was an increase in compensation as a result of increased headcount across the organization.

Now turning to guidance. For the full year of 2022, we continue to expect total revenue between $20 million and $23 million, gross margin between 74% and 76% and operating expenses between $55 million and $61 million. For the first quarter of 2022, we continue to expect to report total revenue between $3.6 million and $4 million.

I would now like to turn the call back over to Nadim.

Thanks, Jared. Before opening the line for questions, I would like to discuss our key areas of focus for 2022 as we seek to drive the increased adoption and utilization of Barostim.

First, the continued expansion of our commercial infrastructure, especially our direct sales force in the United States, remains a top priority. We expect to continue hiring top talent throughout the year and are targeting a total of approximately 26 U.S. territories by year-end or, on average, adding 3 new territories per quarter.

Outside of the U.S., we have added additional talent to our direct sales organization in Germany to help expand our sales efforts in Europe, and we continue to expect to add incremental headcount in 2022 to support our commercial strategy in that region.

In 2022, we will continue to invest in marketing efforts focused on both physician and patient education. This includes the continuation of the direct-to-consumer pilot program initiated in 2021. The pilot is primarily a series of digital marketing campaigns designed to educate potential patients and help them manage through their journey to therapy.

To support these efforts, we are investing in the launch of our new patient-focused branding campaign, which will be rolled out during the first quarter of this year. Currently, the programs are only running in a select number of markets, but we plan to prudently expand to additional geographies in the U.S. and experiment with layering in additional marketing channels throughout the year. We look forward to updating you on the progress on these initiatives on future earnings calls.

As mentioned earlier, we also created an internal prior authorization team. In 2021, we built a small in-house team working directly with physician offices to help patients seek prior authorization for our procedure. We believe this to be a critical function to help facilitate implantations, and the creation of an in-house team allows us to support patients more effectively through their journey. While it is still early days, we have seen encouraging trends, and we will expand the service and team as needed throughout the year.

Our second area of focus is the continued innovation of our product portfolio. We recently received FDA approval for the new IPG and anticipate 2 additional approvals in the first half of 2022, one being for Barostim's MRI conditional labeling and the other being for our new programmer.

Our third focus area is the expansion of the clinical body of evidence. The collection of primary endpoint events in our post-market study of BeAT-HF remains on track. This study is a randomized controlled study designed to demonstrate the mortality and morbidity benefit of Barostim in the HFrEF patient population. We continue to expect to collect all of the data required for the final analysis by the end of 2022 and to unblind the data in 2023.

In addition, we expect to continue to make progress with BATwire, which is our ultrasound guided implant toolkit. In 2022, we will continue adding more sites to the clinical trial as well as enrolling more patients. As a reminder, we expect an FDA approval for BATwire in 2024.

We are very excited about the position that we are in today. Despite the overhang of COVID-19, we are highly confident in our ability to grow our business during the year. The opportunity ahead of us remains large. We have built a solid foundation to accelerate the adoption of Barostim, bringing the relief to as many patients as possible that are suffering with cardiovascular illnesses.

And now is a good time to open the line for questions.

(Operator Instructions) Our first question comes from the line of Robbie Marcus with JPMorgan.

Great. Nadim, maybe we could start, how do you think about the barriers here to Barostim? What's the pushback you get when you go to hospitals? Is it all COVID-related and difficulty getting in and educating and establishing new centers? Is there some pushback to the procedure? Would just love to get your thoughts on how you think about the commercial rollout.

Yes, sure. Robbie, again, thank you for inviting CVRx to present at the JPMorgan conference. That was a great experience for us. We look forward, hopefully, to be invited in future years and, hopefully, to meet face to face. Listen, the obstacles, if you want to call it this way, or the objections that we may face in any new accounts, are very similar to any new therapy. First and foremost, administration is always wary about the reimbursement, and they would like to see a couple of cases reimbursed and paid for. And once they see this, they feel more comfortable.

So what we often see happening are centers signing up first for a pilot phase, a few units, and then expanding into commercial use, making it more of a routine basis. The second is training of physicians, training of nurses on how to identify the appropriate patients who are eligible to receive our therapy and then how to do the implant which, in our case, is very simple. Our own implant is extremely simple. And after the implant is the follow-up and the management of the patients.

What we are seeing, though, right now is possibly a unique situation where we have the confluence of the COVID-19 pandemic carrying us sporadically from time to time and geography to geography, combined, are maybe causing hospital staffing shortage. And in our experience, what we're seeing, this is possibly impacting us proportionally more than established product lines. The reason for that is that any team, given the choice and if they have limited time to select procedures they can do, given the choice, they will revert back to their area of comfort, their zone of comfort, with established procedures. That's why newer procedures end up paying a little bit of a price here being pushed away, and that's what we're seeing.

And why do I know this and how do I know this, we've signed up more accounts than we've activated, particularly in Q4. And when you dig down deep about what is going on, that's exactly what is going on. The staff facing a shortage of 1 or 2 or having a tight schedule, revert back to existing therapies that they know, they're predictable, they know exactly what to expect rather than embarking on a new program. So I don't know, Robbie, if I answered all of your questions in here on what you were trying to get to.

Yes. No, that definitely does. And then maybe just a quick follow-up, much smaller part of the story but somewhat of a hit to 2022 versus prior expectations was Europe. Maybe just update us on -- a month ago, you gave us your plan to stabilize and improve Europe, but maybe just give us a progress report of how it's going so far.

Yes. No, thanks for asking this question. So what is common between Europe, particularly Germany and the United States, is the excitement of physicians and nurses when they see the results of Barostim on their patients. So that's the common ground. We're starting from this basis. We know they're excited. They're seeing the results. They've been seeing the results for our therapy, and they want to continue doing it. We know the product is paid for in Germany. So the only thing that hurt us in Q4, but even started before that, was COVID. Now in Q4, it was exacerbated. When Germany shut down, they had their Delta variant and their Omicron variant back to back. If you recall, in mid-November, late November, Germany shut down due to Delta, and then they switched directly from Delta to Omicron without a break in between the 2.

Now that's the environment. That's what's going on with our therapy in the market. But when I think about how I have managed the situation in Europe and the strategy even before the IPO, I decided for 2021 not to invest in Europe but rather spend every dollar that we're planning to spend in the United States. Rightfully so, we're starting to invest in the U.S. We've got FDA approval, we get reimbursement and we're building solid foundations. We assumed, Jared and I, that without increased investments in Germany, we can stabilize and keep it flat or slightly growing 5%, 6% year-over-year. In fact, it doesn't grow if you flatten out because you'll be sending the wrong signals to your customers about your future support and your future investment in their country.

So we reversed trend. And we started in Q3, we allowed Thomas to start looking for talent and hiring them in Q4. That said, it could be a little bit too late here. The talent that we added in Q3, and particularly in Q4, would not be affected in our estimate until possibly the end of this year. So that's why when we look at our forecast for 2022, we are taking 2021 and assuming it's flat despite the fact that we added a couple of headcounts to Europe.

Our next question comes from the line of Matthew O'Brien with Piper Sandler.

Jared, just for clarification, you said $3.6 million to $4 million for Q1 revenues. Is that right?

Yes, that's correct, Matt.

Okay. So that's obviously down sequentially versus Q4. I get the whole seasonality side of things. But just Q4 beat our number in the U.S. You're still seeing some COVID impacts. Can you just talk about the level of impact? I think, Nadim, you started talking about it a little bit, but just the level of impact you're still seeing on the volume side of things. And then do you need that prior auth group to really kick in before you can get some of those new centers that you've added to really ramp from here? And then I do have a follow-up for Jared as well.

So Matt, maybe I'll jump in just on the numbers real quick. When we put out the guidance of $3.6 million to $4 million, what we were really pushing towards was knowing what was going to happen from Omicron, right? We were a week into January. We were starting to see cases spike all throughout the U.S. and also continuing to cause problems for elective procedures over in Germany. And so when we looked at what we would be able to accomplish in the first quarter, we were going in with the assumption that January was going to be a pretty tough month. Then we'd be able to recover from a fast peak, fast fall from Omicron in the months of February and March. And really, the way that it's played out is kind of as expected for that Q1 guidance so that we saw a pretty significant slowdown in the number of procedures being performed in the month of January and then, as we get into the first and now the second week of February, we're starting to see some recovery on those procedure numbers.

Okay. And then maybe for Nadim, just again, maybe under the surface, what you're seeing from a new center, existing center utilization perspective.

Yes, excellent question, Matthew. So first, let me add to what Jared was saying about COVID here. We expected for the Q4 that Omicron will hit us in January and then things will start settling down, similar to what we've seen with the Delta wave back in December, and we're starting to see increased utilization. Now the question is, is our expectation for February and March to recover for the full quarter in line with our ability to get to the estimate, the guidance, that we provided for Q1? And we believe the answer is absolutely yes. So from that perspective, it's good news in here, the fact that we're seeing an improvement in the COVID situation late in January, early February.

In regard to customers and what we're seeing at the site level, we added in Q4 8 sites. We signed up contracts with more than 8. The beautiful thing, though, that was happening, Matthew, is we've seen an increased utilization in the sites that have been with us more than 12 months. So number one, there is no fatigue. It's not a novelty where they jump on a bandwagon and then they switch, no. Au contraire, the more they use it, the more they see the long-term benefit of their patients, the more they want to use it. The more they verify that the payment is coming without any hiccup, the more they want to use it.

If you recall, Jared was forecasting for the long term that we will get to an average of 1 patient per center per month in the long run. Right now, we have a handful of centers that we've opened up more than a year ago that have exceeded these numbers. So we're very satisfied with what we're doing, Matthew.

Got it. I appreciate that. And then the follow-up is for Jared on the cost side of things. First of all, just for clarification, your OpEx, when you talk about OpEx, you're just talking SG&A plus R&D., is that right?

That's correct.

Okay. So just those 2. So that number for the year, again, is a bit higher than I think some people were expecting, that we were modeling. So I don't know how much of that is the prior auth group. It doesn't seem like the DTC is a huge chunk of that. But can you talk about those 2 things and the returns you expect to get on those 2 things? And then just what else is really contributing to a higher OpEx number here in '22 and then when it may kind of stabilize a little bit from these elevated levels?

Yes. So I'll go through a couple of different components here. So first on research and development line, so we are expecting to see an increased spend in that line in 2022 compared to 2021. As we look at the different programs that Nadim mentioned, number one, the BATwire program, we're going to continue to enroll more patients in that program and treat more patients this year than what we did last year. So we will see a step-up in investment in that program. The second is related to the morbidity/mortality data collection. So there is effort in spend that will go into the data collection but then also in the monitoring of all the sites before we'll be able to submit the data to FDA. So a lot of that spend will be taking place here in '22 as well. So we will see a step-up in research and development this year compared to 2021.

For the sales and marketing side of the house, we continue to add heads, as Nadim mentioned, for that account manager position so that we can get them trained up over that 6-month period and open up a territory for each of those account managers. But we're also making investments in market development reps to help lessen the burden on those physician groups so that they need to spend less time educating the referral cardiologists about the therapy, so that our team can go out there and take on some of that burden for the team. And then we will continue to make the investments that Nadim mentioned in prior auth, in DTC and other marketing campaigns to make sure that we get out in front of patients, that they know what this therapy can do to help relieve their heart failure symptoms.

Our next question comes from the line of Margaret Kaczor with William Blair.

This is actually Brandon on for Margaret. Nadim, you were talking a little bit about how COVID and then a little bit of the staffing shortages that have caused some procedures to be pushed. And I think that was the interpretation of you mentioning that you had signed on more accounts than you were reporting as in planning centers. So the question is, kind of curious if you can give a little bit of an intra-quarter update on those delayed cases specifically. Are those accounts that you've signed on starting to ramp back up as Omicron has subsided? Or does it potentially going to take a little longer? Are there some other things you're prioritizing? So just trying to get a sense of the pipeline of patients you already had or accounts you already had. What can the rebound look like in terms of time?

Yes. Great question, Brandon. So we tried to explain the dynamics. But when you look at the impact, the percent of our business coming from accounts opened more than 12 months, that percent of our business is going to increase. We started 2021 with 11 accounts open, and we end up with 46. This year, we're starting with 46, and we'll be adding about 36 over the year. But you think that the 36 will be adding in 2022 over the 46 of last year is almost 40% or 50%, but more than 80% of our revenue units in 2022 would come from accounts that have already implanted in 2021. You see how that dynamic plays?

So our growth is hinging, yes, of course, on opening up new accounts, but more so is on increasing the utilization on existing accounts. And you see that ratio is changing over the years because we started from a very small base. And that's why we get to this year where I'm telling you, in 2022, we expect 80% or 82% of our revenue to come from the hospitals or the sites that did their first implant last year. So I don't know if that helps you answer the question that you have for me, Brandon. If not, please rearticulate it.

No, that's helpful, Nadim. You were getting to the point of kind of what I was asking. I was just trying to understand the cadence of when those accounts activate given, like you said, they are important to growth going forward, but that's helpful color to think about growth in the next 3 or 4 quarters. Just another question, focusing a little bit on the other comment that you made there in growing your utilization within your existing accounts. Can you talk about what's working in the accounts that are doing really well? You mentioned a handful of them are already doing 1 implant per month, kind of reaching those long-term goals you had. What's working in those accounts? And as we move through '22, how do you implement that same playbook into the rest of the user base?

Yes. It's a great question, actually. When we look back about what works well in accounts, it's that they've been working with us 12 months or more. That's the common denominator, which is great. That means wait and time will heal it. But that's one element, right? But you cannot just rest of it and think that everything will be the same. So our patient and physician education campaign continues. And one thing that I mentioned last month during the JPMorgan call when Ravi asked me the question about what we're doing to alleviate the concerns about the shortage in staffing and so forth, when we look at hospitals, we verify that they've got staff, everything is working. But if we see them struggling, we try to step in and see what are the tasks that we can take on.

For example, patient education, instead of having the physician or the nurse practitioner spend 15 to 30 minutes to educate the patients about the mechanism of action of Barostim or what to expect before, during and after the procedure, we do this. We can do that, right, with our team. And those are some of the elements that help us make the business more predictable for our customers, for our sites. Now if we go back and look at the sites about what's the common trait of the sites overperforming versus those underperforming, there is no rule. I cannot stand here and tell you, well, the academic sites are doing better than the private sites or the SCs are doing better than hospitals, it's not. It's a site that has been working with us more than 12 months and doing better than a site that just started in the last 6 months.

Our next question comes from the line of Bill Plovanic with Canaccord.

If you've started commercialization, you've learned a couple of things and, from listening to the call, maybe some incremental investments, the prior auth team, the market development group team, some of this DTC. I was wondering how much of that is incremental from what you thought 12 or 24 months ago? And then as you look at what's incremental, how much of that do you think is going to be scalable where it's more of an upfront cost than something you have to kind of add one to one over time?

Wow, great question, Bill. So prior auth, we knew from the beginning that we needed the program. We particularly learned by observing other similar companies who have an active implantable device selling it into a market where they did not have full coverage decisions. And it's a temporary thing, the prior auth, right? It will last for a few years. But then, after a while, when we have enough volume to work with payer by payer, to get them to do the coverage decision analysis on us and it will be positive and then they grant us coverage, then yes, the need for the prior auth team will shift.

DTC is a different beast. We did not expect that we'll be investing in DTC that early in the process. And it's a combination of 2 things: number one, observing what worked and what did not work with other companies, like I mentioned; and the second is this need to educate patients to alleviate the workload on hospitals. So because of those 2 reasons, our investment in DTC right now is larger than what we expected to be doing at this stage. Now if it was not providing us a good return on investment, and by return on investment I'm not meaning yet the revenue itself but rather the leading indicators that would lead us to forecast good revenues in the future, we would not be investing these amounts.

Now will this grow? Yes. And again, how do I know? I'm looking at other companies similar to us and their investment in this field, the need to educate patients at the same time that you're educating physicians. And there doesn't seem to be a substitute to DTC to educate patients directly. Now the market development team that we have started building to educate the referring physician, this one we talked about it earlier. We decided to do it this year, starting last year with a couple of pilots. And those couple of pilots turned out to be pretty positive. So we were encouraged by this result, and we are duplicating this model elsewhere in the country.

So that seems to be our operation engine here, our way of operating as a business. Pick a couple of geographies, try something new and new for us. It could be something that has been utilized forever by other companies. Market development or therapy development reps have been utilized by Medtronic and Boston Scientific and other established companies for many, many years. But for us, it was new. Run it in a couple of geographies, verify that it's suitable to our therapy and the dynamism surrounding our therapy. And then if it works, if the numbers feel good, particularly when we look at the leading indicators, then we start investing more and expanding these.

I don't know, Jared, if you can comment on Bill's question about the numbers themselves.

Yes. I won't go into details on numbers of what's changed from what we thought a year ago. I mean it is a pretty different business from where we were at that point in time in December of 2020, still in the heart of COVID and pre-IPO, less money on the balance sheet and trying to decide where we're going to make investments as a company, right? But when I look at where we are at the end of 2021 and the investments we're making in '22, I think it is an add for the MDRs at this point in time in the business. And again, part of this is driven by the need to alleviate workload on the new customers so that they can get programs up and running, get these physicians educated on what this device can do for their patients.

For DTC, again, it's working with centers that are open for business, can treat patients with our device and starting to educate patients in and around those activated centers so that they know that this therapy is available to them. And that's a bit of a step-up from where we were a year ago because of the success we've seen along the way. For the R&D side of the house, some of this is shifting spend, money that we thought we'd be spending a little bit earlier in 2021, seeing that shift into 2022. And part of that is just driven by COVID and not being able to get some of the work done that we wanted to get done in the last 12 months.

Okay. And then if I could have a follow-up. I mean I think the one kind of theme we're hearing, at least I'm hearing, is that time is your friend and your early accounts are becoming productive. I mean that's good news, right? And it sounds like it's repeatable, and you're able to drive it. I guess is it like after 12 months historically when you really see that benefit? Is it more a 6-month type of thing? I mean 12 months is the number you're giving us. But is there anything else that we could see where it is today? And then these investments, how should we think about this, like this will pull them in, instead of 12 months, at 6 months? Or how do we think about that? And that's all I have.

Yes, Bill, very good question. When we plotted all of the revenue units, starting from [TVRO] being the time or the day of the first implant as a new account, right? And you line up all of the accounts like this, and then you add them up and you try to analyze them month by month what is happening, right? You would see a first blip, the first 2 months, 1, 2, 3 revenue units. Then sometimes there's silence for 3, 4 months. And then they start doing 1 every other month for another 6 months, and then they start going closer to 1 a month. And I'm talking here averages, right?

That initial blip is their trial periods. They try 2, 3 patients. Many of our customers got hurt many years ago when they embarked on a new therapy such as CardioMems where they had trouble getting reimbursed; or with WATCHMAN, where the reimbursement was less than their cost initially, if you recall. So before they embark and do ours month after month, administration [per account] on the physicians to say, "You know what, let's do a few patients. You can observe the clinical outcome of those patients. We can observe the payment on those procedures. And if both are positive, then you can continue." And that's what we're seeing at the macro level. And the good news here, all of our accounts are continuing. As far as I know, right now, looking at all of the accounts, all of the 46 accounts have done and continue working with our therapy, which is great news, right?

Now would DTC accelerate this? Possibly after month 6, meaning when they get to month 6, now they go to their organic patient flow. And initially, of course, they start with the sicker patients, right, because of the new therapy, and then they start expanding a little bit closer to the center of the distribution, in the disease progression. Would DTC help? Would a physician accept the patients who is in the middle of the distribution in terms of the disease severity if the patient is knocking on their door saying, "Doctor, treat me with this device," I think the answer is yes. Our experience in previous trials, whether it was a hypertension a decade ago or a heart failure more recently, have shown that physicians have more, say, courage may be the wrong word, but at least more appetite of trying a new procedure, particularly before it gets an FDA approval, if the patient is already knocking on the door, say, "Doctor, please give me this therapy."

So yes, it could help from month 6 and beyond. We're not there yet in our data to be able to confirm that. It's all speculation at this stage. For now, I would say the follow our guidance in terms of what we're saying, what we're forecasting. We have a lot of data that we're looking at. Our early indicator versus trailing indicators are starting to line up. So our ability to forecast the future, pending any other major crisis like another COVID wave or something, our ability to forecast business when it's going business as usual seems to be pretty solid right now. So we're very happy with our data.

I'm showing no further questions in the queue. I would now like to turn the call back over to Nadim for closing remarks.

Yes. Thank you, operator. And thanks again, everyone, for joining us for our fourth quarter earnings call. I know it's late in the day, particularly for those on the East Coast. We appreciate your ongoing support, and we look forward to updating you on our progress on our next update. Good night.

Ladies and gentlemen, this concludes today's conference call. Thank you for your participation. You may now disconnect.