Greetings, and welcome to the Artivion Third Quarter 2024 Financial Conference Call. At this time, all participants are in listen-only mode. A question-and-answer session will follow the formal presentation. As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, Laine Morgan from Gilmartin Group.

Thanks, operator. Good afternoon, and thank you for joining the call today. Joining me today from Artivion's management team are Pat Mackin, CEO; and Lance Berry, CFO. Before we begin, I'd like to make the following statements to comply with the safe harbor requirements of the Private Securities Litigation Reform Act of 1995. Comments made on this call that look forward in time involve risks and uncertainties and are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The forward-looking statements include statements made as to the company's or management's intentions, hopes, beliefs, expectations, or predictions of the future. These forward-looking statements are subject to a number of risks, uncertainties, estimates, and assumptions that may cause actual results to differ materially from these forward-looking statements. Additional information concerning certain risks and uncertainties that may impact these forward-looking statements is contained from time to time in the company's SEC filings and in the press release that was issued earlier today. You can also find a brief presentation with details highlighted on today's call on the Investor Relations section of the Artivion website. Now I'll turn it over to our Artivion CEO, Pat Mackin.

Thanks, Laine, and good afternoon, everyone. I'm pleased to report continued strong financial performance through the third quarter as we delivered robust revenue growth and further improved operating leverage. We also made breakthrough progress on several key clinical and regulatory initiatives that have collectively given us greater conviction in our ability to execute our best-in-class PMA focused pipeline and deliver sustained double-digit revenue growth while growing EBITDA twice as fast as revenue. In the third quarter of 2024, we delivered constant currency revenue growth of 10% year-over-year, representing $95.8 million in revenue and adjusted EBITDA growth of 28% year-over-year compared to the third quarter of 2023. Let me first cover our Q3 financial performance before addressing the significant clinical and regulatory updates for the quarter. From a financial perspective, our strong Q3 performance was enabled by continued growth across our product portfolio as well as continued benefit from regulatory approvals and commercial footprint expansion in key international markets, especially in Latin America and Asia Pacific. From a product category perspective, On-X revenues increased 15% year-over-year on a constant currency basis as we continue to take market share globally, with the only mechanical aortic valve that can be maintained at a low INR of 1.5 to 2.0. Based on feedback from the field, our recent market share gains, and the proven clinical benefits of the On-X aortic valve, we maintain our strong conviction that On-X is the best aortic valve in the market, and we'll continue to take market share worldwide. BioGlue grew 14% on a constant currency basis compared to the same period last year. This was the second straight quarter of double-digit constant currency revenue growth for BioGlue. We are pleased with the strong performance to date of BioGlue as we continue to grow this differentiated product globally. Also in Q3, our stent graft revenues grew 13% on a constant currency basis in the third quarter compared to the same period last year. Our stent graft portfolio remains a key component of our growth strategy, and we are encouraged by our strong results, which were driven by our differentiated portfolio of products focused on more complex segments of the stent graft market. Today, the products in our stent graft portfolio are primarily sold in Europe, where we leverage our existing direct sales infrastructure to create significant cross-selling opportunities across our unique aortic product offering. Our pipeline consists largely of bringing these proven products to the U.S. and Japan markets, which represents a significant growth opportunity. Lastly, tissue processing grew 2% year-over-year on a constant currency basis compared to Q3 of last year. This slightly lower-than-expected growth was driven by lower-than-anticipated donor allograft volumes in the third quarter. While we do not report revenues on a product-by-product basis, for context, tissue processing growth is driven primarily by our SynerGraft pulmonary valves, which are used in the Ross procedure. For those unfamiliar with the Ross procedure, it's a double valve procedure in which a patient's native pulmonary valve is used to replace the patient's defective aortic valve, and then the patient's pulmonary valve is replaced by the donor pulmonary allograft. Because of the success of this procedure, demand for our SynerGraft pulmonary valves significantly exceeds our supply, and therefore, our growth is dependent on donor allograft volumes, which tend to fluctuate from quarter to quarter. Still, tissue processing revenues have grown 11% year-to-date on a year-over-year constant currency basis. Importantly, our team has also initiated new measures to further improve donor yields beginning in Q4 and early into 2025, leaving us increasingly confident that our tissue business can be a mid-single-digit grower over the long-term. However, you should expect to see some fluctuations in growth rates quarter-to-quarter driven by underlying fluctuations in donation. From a geographic standpoint, we continue to see great results from our growth initiatives across Latin America and Asia Pacific, primarily through new regulatory approvals and commercial footprint expansion. Latin America and Asia Pacific delivered constant currency revenue growth of 32% and 23%, respectively, compared to the third quarter of last year. We continue to anticipate strong revenue growth for both regions for the full year and over the coming years as we continue to leverage our industry-leading product portfolio in those regions. I will now turn to our product pipeline and regulatory developments. We are excited to announce that we recently filed the first module of the PMA application for AMDS with the FDA. We continue to anticipate FDA PMA approval for AMDS in Q4 of 2025, which, as we've discussed, would open up a U.S. addressable market opportunity of approximately $150 million with no competitive alternatives. I'm also pleased to announce our recent regulatory approval from the National Medical Products Administration, also known as NMPA, to commercialize BioGlue in China. We estimate that approximately 12,000 patients in China each year having an acute Type A dissection could benefit from BioGlue. There are some additional administrative steps that we have to take to gain reimbursement and then to get access at the hospital level. These steps are expected to take 9 to 12 months, and therefore, we expect to begin commercializing BioGlue in China in the second half of 2025. BioGlue has been a great product for patients for many years, and we're excited to be able to bring this technology to another large market in China. Now we discuss the two regulatory updates. I would like to update you on our pipeline and recently released clinical data. First, in October, Endospan completed enrollment in the U.S. IDE pivotal trial called TRIOMPHE for its NEXUS Aortic Arch Stent Graft System. Assuming the trial endpoints are met, NEXUS remains on track for approval in the second half of 2026. As a reminder, aortic arch disease with aneurysms or dissections has previously offered little choice before NEXUS except to undergo an open chest surgery, which is an invasive operation associated with lengthy hospitalizations and prolonged recuperation. NEXUS is a highly differentiated technology that transforms a complex surgical aortic arch repair into a minimally invasive endovascular repair. Second, at EACTS in October, we are very pleased to see our AMDS and E-vita OPEN NEO technologies take center stage at the aortic focus late-breaking science session. Late-breaking 5-year data from our AMDS DARTS trial reported long-term clinical follow-up on the remaining 25 of 46 study participants with the acute Type A dissections who were treated with approximately aortic repair and AMDS. The results demonstrate that 94% of patients were free from aortic reoperation compared to existing literature on hemiarch-only outcomes, which report freedom from late aortic arch reoperation as low as 76%. Additionally, 95% of patients were free from total aortic diameter growth above 5 millimeters at zones 2 and 4. This compares favorably to existing literature on hemiarch-only outcomes, which suggests a majority of patients have early aortic diameter growth in the proximal descending aorta. For context, significant growth of the aorta can lead to increased risk of rupture, dissection, and reoperation. Long-term results from DARTS trials show that a large majority of the patients experienced stable or decreased total aortic diameter following treatment with AMDS and thus are at decreased risk for further aortic dissection or reoperation as far out as 5 years post-implantation, thus showing the durable effect of the therapy. Third, regarding AMDS, 30-day data from the PERSEVERE trial showed a cerebral malperfusion resolution of 90% of affected subjects in the AMDS implantation group. The results also indicated a stroke occurrence of 10.8% following AMDS implant, which compares favorably to 20.9% for hemiarch alone based on five articles in literature. Cerebral malperfusion, often leading to stroke, is a major complication for acute Type A aortic dissections. These positive results from PERSEVERE trials show that AMDS reduces malperfusion and the rate of stroke. We're excited to see the continued positive results from both DARTS and PERSEVERE studies, further reinforcing the significant clinical benefits and life-saving nature of AMDS. Lastly, at EACTS, 1-year data from the NEOS trial showed that the E-vita OPEN NEO is safe and effective in treating aortic arch pathologies. E-vita OPEN NEO is our current generation frozen elephant trunk that is sold internationally and is the predecessor to our pipeline product called ARCEVO LSA. Notably, the 161 patients treated with E-vita OPEN NEO experienced lower 1-year mortality and 1-year combined major adverse event rates compared to the current market-leading device. Given that we anticipate the ARCEVO U.S. IDE trial will be in the range of 120 patients, these results give us greater confidence in the future success of that trial. In summary, we're encouraged by our Q3 financial performance and thrilled with the progress this quarter on the regulatory and clinical fronts. Our strong financial, clinical, and regulatory performance positions us well for the remainder of '24 and beyond and increases the confidence we have in our ability to deliver sustainable double-digit revenue growth while driving EBITDA margin expansion and growing EBITDA twice as fast as sales. With that, I'll now turn the call over to Lance.

Thank you, Pat, and good afternoon, everyone. Before I start, I want to remind you to refer to our press release from earlier today for details about our non-GAAP results, including a reconciliation to our GAAP results. Also, all percentage changes mentioned will be year-over-year, and revenue growth rates will be in constant currency unless stated otherwise. Total revenues for the third quarter of 2024 were $95.8 million, representing a 10% increase in constant currency compared to Q3 of 2023. Adjusted EBITDA rose roughly 28% from $13.9 million to $17.7 million in the third quarter of 2024. The adjusted EBITDA margin was 18.5% in Q3 2024, marking a 270 basis point improvement from the previous year, driven by a 220 basis point decrease in general, administrative, and marketing expenses as a percentage of sales. We believe our sales and G&A infrastructure is highly scalable, and the considerable leverage we've generated in the first half of the year reinforces this belief. Regarding our product lines, On-X revenues increased by 15%, BioGlue revenues grew by 14%, stent graft revenues rose by 13%, and tissue processing revenues increased by 2% in Q3 2024. Other revenue fell by about $561,000, or 17%, this quarter, primarily due to the timing of PerClot orders from Baxter, which is managing its inventory levels. While the end-user sales of PerClot are starting to increase, we expect these inventory dynamics to persist throughout the remainder of 2024. Excluding this factor, our underlying business experienced an 11% growth in Q3 compared to Q3 of 2023. Regionally, revenues in Latin America rose 32%, Asia Pacific improved by 23%, EMEA grew by 15%, and North America saw a 2% increase, all compared to the third quarter of 2023. As forecasted, gross margins were at 64% in Q3, unchanged from the same period last year. General, administrative, and marketing expenses for Q3 were $50 million, compared to $51.1 million in the same quarter of 2023. Non-GAAP general, administrative, and marketing expenses totaled $46.6 million in Q3 versus $44.7 million in Q3 2023. R&D expenses for the quarter stood at $6.6 million, compared to $6.4 million in Q3 2023. We still expect full-year R&D spending as a percentage of sales to remain relatively flat compared to the prior year. Interest expense, net of interest income, was $8 million, compared to $6.3 million last year. This quarter's other income included foreign currency translation gains of about $2.4 million. Our free cash flow for Q3 of 2024 was $7.8 million, and we expect it to remain positive for the full year 2024. As of September 30, 2024, we had roughly $56.2 million in cash and $314 million in debt, net of $6.3 million in unamortized loan origination costs. This reflects our recent amendment agreement with Endospan. Additionally, our convertible debt was reclassified to current this quarter as anticipated. As previously discussed, our delayed draw term loan announced earlier this year allows for flexibility in settling the convert with cash or shares, provided our stock price exceeds $23.46 at maturity in July 2025. We do not foresee the need to raise additional capital to meet our debt obligations, fund our channel investments, or support our pipeline in the near term. Our net leverage at the end of Q3 was 3.9x, down from 5.3x in prior years. At the midpoint of our EBITDA guidance range, we anticipate net leverage to approximate 3.5x by the year's end and to continue declining in 2025. Looking forward to the remainder of 2024, we still expect constant currency growth of 10% to 12% for the full year compared to 2023. We are narrowing our estimated revenue range to $389 million to $396 million, down from our previous range of $388 million to $396 million. At current foreign exchange rates, we expect currency fluctuations to have a minimal impact on full year revenue growth rates. As we look ahead, we are confident in our ability to achieve low double-digit growth year-over-year in the long-term, driven by our portfolio of differentiated products and our top-tier R&D pipeline. With continued revenue growth and effective management of general expenses through Q3, we expect adjusted EBITDA to fall between $69 million to $72 million for the full year 2024, which represents a 28% to 34% increase over 2023 and an expansion of adjusted EBITDA margins by 280 basis points at the midpoint of our ranges. We anticipate gross margins to remain at levels similar to 2023 and expect to leverage our global sales force and G&A infrastructure significantly. Moreover, we expect R&D expenses to stay relatively flat as a percentage of sales. Finally, I want to address our outlook for 2025. We will provide guidance for 2025 in February during our Q4 earnings call, but I wanted to share some directional insights as you consider 2025. Generally, we expect the same dynamics for our existing product portfolio in 2025 as we have in 2024, with the exception of not having a quarter of significant increase from the SynerGraft pulmonary valve in our tissue business, which we experienced in 2024. We plan to continue driving EBITDA margin expansion through effective utilization of sales and G&A resources. Now, I'll turn the call back to Pat for his closing remarks.

Thanks, Lance. So as you've heard throughout our comments, we're committed to shareholders that we will deliver double-digit revenue growth and double that for EBITDA. You've also just heard about our strong execution of our R&D pipeline, which gives us stronger confidence that we can deliver on these financial commitments going forward. More specifically, we have the following key regulatory approvals in three PMAs in our R&D pipeline that will help us to deliver on the continued revenue and EBITDA growth. First, BioGlue China regulatory approval. This opens up a major new market starting in the second half of 2025. Second, the AMDS PMA. We've just completed the one-year follow-up of the PERSEVERE trial, and we just filed the first PMA module, both of which put us on track for a Q4 2025 PMA approval. Third, the NEXUS PMA. Our partner Endospan has completed enrollment in the NEXUS IDE trial called TRIOMPHE, which puts the PMA on track for approval in the second half of 2026. Fourth, ARCEVO LSA PMA. Presentation of the clinical data at EACTS from the NEOS clinical trial that is our current generation frozen elephant trunk called NEO was presented in 161 patients, which showed clinical results that are better than the commercially available device that's on the U.S. market today. Given that our U.S. IDE trial for ARCEVO LSA enrolled around 120 patients, the results of the NEOS trial give us great confidence that the ARCEVO LSA trial will also be successful. Finally, I want to thank all of our employees around the globe for their continued dedication to our mission of being the leading partner to surgeons focused on aortic disease. With that, operator, please open the line for questions.

The first question that we have comes from Daniel Stauder of Citizens JMP.

Yes. Great. I guess I'll start off on the aortic stent graft business. So another strong quarter despite 3Q '23 being a tougher comp. I just wanted to ask if you can give any more color on what specific products are performing well? Or if you could just give us any puts and takes on what's driving this business? And is it any cross-selling benefits or anything you're seeing in the market?

Yes. I have a few points to share, and Lance can add his thoughts as well. We don't disclose specific product segment details, but we have several products covering the entire aorta, and almost all of them are experiencing double-digit growth, which we expect to continue. We're observing this growth in Europe, Asia, and Latin America. It seems to be consistent, as we have a differentiated portfolio and are expanding globally at the same time.

Great. And just one follow-up on On-X. So you noted some share gain nationally. I just want to get a sense of what extent are you seeing this? And how should we think about this or where this could go in 2025? And are you seeing more traction just mostly because of the new data with the reduced bleeding? Just any puts and takes or any other additional commentary as we think about that?

Yes. So if you start at the kind of the globe, we've got about 30% market share globally. We are much stronger in the U.S.; we're in the 55% range in the U.S. The share gains we're seeing are really across the globe. We continue to take share in the U.S., driven by the post-approval trial. And just as a refresher, we ran the original PMA trial for On-X low INR, and it showed a 60% reduction in major bleeding. We've ended a post-approval trial with a 5-year follow-up required by the FDA and 500 valves. We presented that in May, showing an 87% reduction in major bleeding. Based on our market checks and research, we expect our market share in the U.S. to continue to go up, and we've got even more upside opportunity internationally. So I think On-X continues. And as we've told investors, we think that's a double-digit growth product, and it has been for the last 6 or 7 years. So we're continuing to execute on what we said we would do.

The next question we have comes from Suraj Kalia of Oppenheimer & Co.

Pat, Lance, congrats on the quarter. Can you hear me all right?

Yes, we can hear you fine.

Perfect. So Pat, regarding SynerGraft, we expect long-term mid-single-digit growth. Just a related question: do you believe there are other complementary alternative assets that could enhance growth rates? This seems to align with how Ross operates and the approach SynerGraft uses with the donation algorithm, which suggests a direction for our thinking.

Yes. There are several impressive aspects of the Ross procedure and particularly the Ross with SynerGraft. We have 25 years of data on the Ross procedure using SynerGraft, which is remarkable. The success of this procedure can be attributed to this data. Recent publications indicate that patients who undergo the Ross procedure can achieve similar survival rates and quality of life as those who do not. The data is excellent. However, we face limitations due to donation constraints. We are continuously working on improving our processes. Over the past year, we have made significant improvements to our yields on the SynerGraft pulmonary valve. We have more strategies in development because we are always exploring new options. We will keep working on this, but I cannot simply instruct the factory to increase production. We sell every unit that is produced, and we are focused on meeting market demands as effectively as possible.

Pat, regarding the NEXUS trial, the 30-day outcomes were positive in terms of stroke and paraplegia. Even though the TRIOMPHE trial mentions 30 days, can you remind us if there are any concerns about late migration?

No, the only public data available on NEXUS, the U.S. IDE trial called TRIOMPHE, was presented at STS involving 20 patients. Brad Leshnower from Emory shared that data and it showed very good results. They are primarily focused on tracking metrics such as stroke rate, paraplegia rate, reoperations, mortality, and renal dialysis, similar to the data we monitor in PERSEVERE. We haven't yet seen the full 60-day cohort that will be submitted to the FDA; we might see that in January or May. However, we do not manage that trial; Endospan does. Once they release the data, we will respond accordingly. What’s particularly significant about this device is that it is the only arch thoracic stent graft specifically designed for the arch. Surgeons acknowledge that it is uniquely engineered for that purpose. It operates as a 2P system, and to our knowledge, there has been no migration associated with this technology because of its design. It is custom technology specifically made for the aortic arch and we have observed excellent results so far. I'm very eager to see the 60-day outcomes as I believe this will be a game changer for patients.

Got it. Lance, one question for you, and I'll hop back in the queue. Is the game plan still that if the stock is, let's say, above $30 force a conversion? And then should we start factoring in on an as-converted basis when we think about the fully diluted EPS because you guys are pretty close right now to breakeven, and I just want to make sure from a modeling perspective, any color would be great.

Thanks, Suraj. Yes. We have the advantage of having options with our delayed draw term loan. Over the past couple of quarters, we've indicated that we can take a wait-and-see approach regarding interest rates and our stock price before making a decision. We're still in that position. I want to advise investors that it could go either way, so consider the most conservative approach. If you prefer to assume the shares will convert, that is a conservative strategy. Alternatively, if you think drawing down the delayed draw term loan and facing additional interest expense is more prudent, then I recommend that approach. Right now, we're still monitoring the situation, and the outcome is uncertain.

The next question we have comes from Frank Takkinen of Lake Street Capital.

This is Nelson Cox speaking for Frank. I’d like to begin with AMDS. Could you explain how we should view its launch, particularly the learning curve involved with the bags? Will there be a soft launch in 2025 followed by a full launch in 2026? Additionally, any other insights you could share would be appreciated.

Yes. To recap where we are, we recently reached the one-year follow-up and will need to compile that data for the clinical module that will be submitted. We have already submitted our first module, which keeps us on track to seek FDA approval in the fourth quarter of 2025, which is about a year from now. If we obtain that approval in Q4 2025, I think a soft launch is a reasonable expectation for that timeframe. We still need to work with value analysis committees and train surgeons to ensure they adopt the devices. We have a strong sales team and established relationships with our customers and hospitals, but we must follow the necessary processes. Additionally, the fact that this technology is lifesaving, as evidenced by recent results showing a significant reduction in stroke incidents with acute Type A dissections from the PERSEVERE trial presented at EACTS, gives us confidence. The lower mortality and stroke rates should help us navigate the value analysis committees more efficiently, although I'll have more clarity once we've launched. We are prepared, and our sales team is ready to take action.

And maybe I'll jump in, just put my plug in for everyone as you think about 2025 from a modeling standpoint. I would advise everyone to not put any revenue in for AMDS with the Q4 approval and just the things you have to do to get going, revenue would be very minimal, if any, in 2025. I think the safe thing is just at the moment to assume zero. And then if we get beneficial timing and it's sooner, then we can talk about adding some of that.

Perfect. And then maybe just about the pricing opportunity in the preservation business, specifically SynerGraft. Do you see more room to take additional price? Or do you kind of feel like you're reaching a point where you can maybe stay consistent for a while?

Yes. I mean, I think we're sensitive to the pricing environment out there and I think the price increase we did last year was pretty significant. I don't think there's a lot of room on that. I think there are other parts. It's not the only tissue we have in the portfolio. So there are other areas where we will be getting price increases. But I think the SynerGraft one is probably not one we're going to be going after any time soon.

The next question we have comes from Mike Matson of Needham & Co.

Yes. I guess with AMDS, I'm a little surprised that it's the first module because I feel like the data is usually the final module. So can you maybe just talk about what's going there?

Let me clarify, Mike. I think you might have made it sound confusing when I just said that, right? So we have 4 or 5 modules we're going to submit. We submitted the first module. The last module will be clinical. And you're correct; the last module is going to be clinical.

And so when would that final model be submitted, do you think?

Probably in the second quarter of 2025.

Okay. And you still think it can be approved in the fourth quarter?

Yes, I do.

Okay. All right. Okay. And then just on BioGlue in China, I seem to remember you talking about that being like a $20 million opportunity. Is that still the right number?

Yes, go ahead.

And then I'll let you answer that. Let me just go ahead and finish the question. How fast does that ramp? I mean, is this kind of like a one-year step-up? Or would it be more gradual, kind of like a tailwind over several years as you penetrate that market?

Yes. First, Lance and I reviewed our earnings transcripts to find our last comments regarding BioGlue in China, which were made two years ago. We stated that we're working with the Chinese regulators and that you would hear from us in the summer of 2024. We are pleased to report progress on the approval. Your calculations are accurate. However, as I mentioned earlier, China has specific requirements. We need to secure national medical registration, then provincial registration, and get on the hospital price lists. This process takes time, and we do not expect significant developments until the second half of 2025. Expect a gradual increase over several years, rather than a one-time jump.

Yes, I understand. Regarding the PerClot manufacturing agreement, how much revenue is it currently generating, and when might it start to pose a challenge? In which year do you expect that to happen?

So that depends on how fast they can be ready to take it over. They obviously would like to take it over as fast as they can, and we'd be more than happy to transfer it to them. If it just went away completely in the full year in and then a full year out, you're talking about slightly less than a 1 percentage point headwind. So it's just not significant. This year, it's created some noise quarter-to-quarter. But it's always about a 1 point headwind. For the full year this year, it's probably about a 1 point headwind to last year. And if it stays at that level, which is our assumption, when it goes away completely, it will be about a 1 point headwind that year. Right now, it looks like for sure we'll have it for the full year of '25, and then we'll have to assess after that. It also has really little to no impact on EBITDA. We're just kind of manufacturing for them.

The next question we have comes from Jeffrey Cohen of Ladenburg Thalmann.

So I guess, firstly, Lance, you had some commentary about the preservation business for 2025. And was that Q1 that you called out from the previous bolus of Q1 in SynerGraft from Q1 last year or Q1 this year as it would pertain to Q1 next year?

We experienced a significant price increase for SynerGraft in the second quarter of 2023, which led to a period of heightened growth rates in the first quarter of 2024 before we annualize those figures. If you revisit the first quarter of 2024, you'll notice a substantial growth rate for the tissue business. It's important to point out that this will be a key difference when comparing 2025 to 2024, as we won't have that one quarter of elevated growth rates in the tissue business.

Yes, we see a $25.7 million increase from $26.3 million. That's clear to me. Could you discuss LatAm and APAC, specifically mentioning Japan and the various specific countries in APAC and LatAm?

Yes. We're not going to get into specific countries, Jeff. I don't necessarily need to telegraph what we're doing to our competitors. I will say that in Asia, when I started here, we had one person, and now we've got 50. In Latin America, we had none, and now we have 25. We're direct in Brazil. We've talked about before. We mostly won a distributor in LatAm. So we've gone direct in several countries in Asia, but I'm not going to get into the specifics of where we are now and where we're going later.

Okay. Got it. And then lastly, Lance, any further commentary on gross margins for Q4 and/or for '25? Does you feel like mid-60s is kind of the right territory to think about?

Yes. I mean, I think at the moment, we just need to think about gross margins being relatively flat year-to-year and quarter-to-quarter. You may have some minor fluctuations just due to revenue mix in any given quarter. And then once down the line, when we get approvals of these products in our pipeline and they come to the U.S. market, then we should be able to see some gross margin expansion through mix. But at the moment, I would tell people to just kind of model gross margins is fairly flat year-to-year.

Ladies and gentlemen, we have reached the end of our question-and-answer session. And I would like to turn the call back to Pat Mackin for closing remarks. Please go ahead, sir.

Thank you for joining us. We appreciate your presence. We had another strong quarter with double-digit revenue growth and over 28% growth on the bottom line. We've achieved remarkable performance with our pipeline, including regulatory approval in China and late-breaking trials for AMDS at EACTS, which is the largest cardiac meeting in Europe. The NEO trial was also presented there. Additionally, NEXUS has completed enrollment in their pivotal trial, positioning them well for 2026. We recently concluded the NEOS trial in Europe with 161 patients, which surpasses our planned U.S. enrollment, and the results were very positive, outpacing the market. We believe that we can sustain double-digit growth on the top line and even faster growth on the bottom line. Thank you for joining us, and we look forward to seeing you on our next call.

Thank you, sir. Ladies and gentlemen, that then concludes today's conference. Thank you for joining us. You may now disconnect your lines.