Abiomed, Inc (ABMD)
Q4 2010 Earnings Call Transcript
May 19, 2010 8:00 a.m. EST
Aimee Maillett - Corporate Communications Department
Mike Minogue - Chairman, President, CEO
Bob Bowen - CFO, VP
Greg Simpson - Stifel Nicolaus
Tim Lee - Piper Jaffray
[James] - Morgan Stanley
[Eli Coburn] - Bank of America Merrill Lynch
Josh Jennings - Jefferies & Company
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Thank you, [Erika]. Good morning and welcome to Abiomed's fourth quarter of fiscal 2010 earnings conference call. This is Aimee Maillett of Abiomed’s Corporate Communications Department. I am here with Mike Minogue, Abiomed Chairman, President and Chief Executive Officer and Bob Bowen, Vice President and Chief Financial Officer.
The format for today’s call will be as follows. First, Mike will provide you with strategic highlights for the fourth quarter. Next Bob will provide details on the financial results outlined in today's press release. We will then open up the call for your questions.
Before we begin discussing the fourth quarter, 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 fourth quarter of fiscal 2010 as compared to the fourth quarter of fiscal 2009 or fourth quarter of fiscal 2010 as compared to the prior third quarter of fiscal 2010.
I am now pleased to introduce Mike Minogue, Abiomed Chairman, President and Chief Executive Officer.
Thank you, Aimee, and good morning, everyone. Our Q4 strategy to focus on and penetrate existing Impella sites was rewarded with patient utilization growth of 109% year-over-year and 28% sequentially.
We supported more Impella commercial patients this quarter than all of fiscal year 2009 combined. We believe our product enhancements and quicker setup as well as the positive reception to our US dollar registry and multiple publications were key drivers in the growth of patients supported by Impella.
Abiomed today reports Q4 record US utilization of 545 patients, record US reorder revenue of $13 million, up 165%, record US and worldwide Impella revenue of $15.2 million and $16.7 million, up 67% and 49% respectively and record fourth quarter revenue of $23 million, up 17%.
We achieved these results while generating cash from ongoing operations and managing our inventories. Our strong gross margins for the year reflect our operating capability as well as the value proposition offered by the therapy.
Our plan last quarter to add fewer new hospitals was offset by the significant ramp in patients supported. We attained overall growth while only opening 21 new Impella 2.5 sites with a stocking order of approximately three pumps as compared to 66 hospitals opened in the prior year and sequential quarter.
There are 413 of the 1000 US [hard] hospitals with Impella 2.5 technology. We continue to upgrade our Impella installed base to the quick setup kit and retrained our users. As a reminder, the upgrade process requires three days and includes additional onsite training.
As of the end of Q4, approximately 95% of the US customers have been upgraded. The general feedback on the new platform is very positive and the Impella setup time has been reduced from approximately 11 minutes to two minutes.
These enhancements are catalyst, driving our positive trends. Compared to just the sequential third quarter ending in December, there was a 62% increase in the number of patients done independently and a 55% increase in AMI patients.
We estimate that 20% of the cases in Q4 were done independently and we believe 166 or 39% of our accounts have independent ability based on supporting five or more Impella patients.
As a benchmark in Q4, one top territory had 50% independent use of Impella. Our definition of independent implantation includes phone support of follow-up help. As sites become more independent we will likely not be aware of every Impella patient and, as a result, the reorder number will be our focus.
For the quarter, 63% of the utilization was reported for prophylactic hemodynamic support during high-risk PCI and 37% reported for urgent or emergent hemodynamic support such as AMI and eight other applications.
In Q4 we achieved a midway point of the protective study. We completed a one-day meeting with the research coordinators at the remaining 40 plus hospitals selected by the Physician Steering committee.