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Abiomed, Inc. (ABMD)

F2Q09 Earnings Call

November 10, 2008 8:00 am ET


Aimee Maillett - Corporate Communications Department

Michael R. Minogue - Chairman of the Board, President, Chief Executive Officer

Ian McLeod - Principal Financial Officer


David Lewis - Morgan Stanley

Greg Simpson - Stifel Nicolaus & Company, Inc.

Assaf Guterman - Lazard Capital Markets

Bob Hopkins – Banc of America



Good day ladies and gentlemen and welcome to the second quarter 2009 Abiomed Inc. earnings conference call. My name is Anne and I will be your coordinator for today’s call. (Operator Instructions). I would now like to turn the presentation over to Aimee Maillett of the Corporate Communications Department.

Aimee Maillett

Good morning and welcome to Abiomed's second quarter 2009 earnings conference call. This is Aimee Maillett of Abiomed’s Corporate Communications Department. I'm here with Mike Minogue, Abiomed's Chairman, President and Chief Executive Officer and Ian McLeod our Principal Financial Officer.

Format for today’s call will be as follows. First, Mike will provide you with strategic highlights for the second quarter, next Ian will provide details on the financial results outlined in today's press release, and we will then open up the call for your questions.

Before we begin discussing Q2, it is necessary to remind you that during the course of this call, we will be making forward-looking statements including statements regarding future financial performance, product development efforts, Abiomed's strategic operational initiatives, market response to our new products, our progress towards commercial growth, and future opportunities. Abiomed's actual results may differ materially from those anticipated in these forward-looking statements based upon a number of factors including uncertainties associated with development, testing, and related regulatory approvals, competition, technological changes, anticipated future losses, complex manufacturing, high quality requirements, dependence on limited sources of supply, government regulation, future capital needs, and other risks detailed in our SEC filings.

Investors are cautioned not to place undue reliance on any forward-looking statements which speak only as of the date of today's conference call. The company undertakes no obligation to publicly release the results of any revisions to these forward-looking statements that may be made to reflect events or circumstances that occur after the date of this conference call or to reflect the occurrence of unanticipated events.

Lastly, comparative references made financially in this call to revenue, expenses, gross margin, or other increases or decreases will be indicated by references to second quarter of fiscal 2009 as compared to the second quarter of fiscal 2008 or second quarter of fiscal 2009 as compared to the prior first quarter of 2009.

I am now pleased to introduce Mike Minogue, Abiomed's Chairman, President and Chief Executive Officer.

Michael R. Minogue

Good morning everyone. Thank you for joining our call.

Today, I am proud to report the best quarter in company history with revenues of $20 million during our summer quarter. Impella sales are taking off. After one full quarter of 510(k) clearance, we’ve achieved our fiscal year objective ahead of schedule of over 100 US Impella cardiac hospitals with general use catheters and over 100 patients supported in the US outside of the trial. This signifies that the intraaortic balloon pump or IABP conversion to Impella is happening under the 510(k) clearance. Those who attended the TCT conference in mid October witnessed this growing momentum.

As of the end of Q2, we have 6% commercial penetration of a potential 1700 US hospitals and we continue to prioritize the next top 200 heart hospitals based on volume.

As a company, we are driving results and executing on our 4 corporate goals of launching Impella 2.5, increasing Impella manufacturing capacity, driving to profitability, and increasing revenues greater than 25%.

Today, I will review the first goal in more detail and provide updates on the last 2 corporate goals.

So, first on our number one goal of launching Impella 2.5 and the clinical studies, total Impella revenue was $10.5 million, up 650% for the second fiscal quarter of 2009 compared to the same period of fiscal 2008. Impella revenue recorded during the second fiscal quarter of 2009 included $8.8 million in the US, sales of which $6.2 million was for sales of the Impella 2.5 device sold under 510(k) clearance and $2.6 million sold under the Protect2 and Recover2 trials.

At the end of the quarter, a total of 108 sites had acquired commercial 510(k) catheters and 40% of them had already supported one or multiple patients with Impella, again that was at the end of the quarter. Twenty sites had already supported two or more patients and 8 sites had used it in 5 or more patients outside of the trial by the end of the quarter.

The average order for Impella catheters sold during the quarter was approximately 4 pumps per order. As of September 30, 2008, Impella 2.5 commercial 510(k) usage was at 97% in the cath lab and 3% usage in the surgery. Of the Impella procedures in the cath lab, 76% were for high-risk PCI, 15% were for AMI shock, and 9% were for other forms of shock or cardiac decompensation. This is following the trend from Europe as customers gain experience from high-risk PCI and experience other applications.

Impella continues to grow in Europe, particularly in Germany and the Netherlands are only countries in Europe with a direct sales approach. This was our best quarter in Europe with revenue growth at 87% from Impella and strong growth on the legacy business of 60% from our AB5000 VADs driven primarily with our new portable driver.

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