Good afternoon. Welcome to Establishment Labs' Third Quarter 2022 Earnings Conference Call. I will now turn the conference over to Raj Denhoy, Chief Financial Officer. Please go ahead.

Thank you, operator, and thank you, everyone for joining us. With me today is Juan Jose Chacon-Quiros, our Chief Executive Officer. Following our prepared remarks, we'll take your questions. Before we begin, I would like to remind you that comments made by management during this call will include forward-looking statements within the meaning of federal securities laws. These include statements on Establishment Labs' financial outlook and the Company's plan to timing for product development and sales. These forward-looking statements are based on management's current expectations and involve risks and uncertainties. For a discussion of the principal risk factors and uncertainties that may affect our performance or cause actual results to differ materially from these statements, I encourage you to review our most recent annual and quarterly reports on Form 10-K and Form 10-Q as well as other SEC filings which are available on our website at establishmentlabs.com. I would also like to remind you that our comments will include certain non-GAAP financial measures with respect to our performance, including but not limited to sales results which can be stated on a constant currency basis. Reconciliations to the most directly comparable GAAP financial results can be found in today’s press release which is available on our website. Please also note that Establishment Labs received an investigational device exemption from the FDA for Motiva implants and is undergoing a clinical trial to support regulatory approval in the United States. We continually seek to expand the geographies in which our products are regulatory approved. Please check with the local authority for specific product availability. The content of this conference call contains time-sensitive information, accurate only as of the date of this live broadcast, November 7, 2022. Except as required by law, Establishment Labs undertakes no obligation to revise or otherwise update any statement to reflect events or circumstances after the date of this call. With that, it is my pleasure to turn the call over to our CEO, Juan Jose.

Thank you, Raj. And good morning, everyone. I hope everyone is healthy and continues to remain safe. Revenue in the third quarter of 2022 totaled $38.2 million, a 32% increase over the third quarter of 2021. Excluding the negative impact of foreign currency changes, our growth in the third quarter would have been approximately 38%. Our strong market share gains continue to be driven by our singular focus on women's health and wellbeing. Our commitment to bring highly differentiated technology to the breast aesthetics and reconstruction markets based on science and patient-centric design is wholly unique in our industry. With this commitment to innovation, we are expanding existing markets and creating new categories that will sustain our growth for many years to come. Raj will provide additional detail on our third quarter performance in our updated outlook, including tightening our revenue guidance range to $158 million to $162 million. But before I turn the call over to him, I would like to highlight recent events over the past several months. On Wednesday, October 5, we presented an update on Mia Femtech, the new category we are creating in breast aesthetics. During the presentation, we showed an update on the clinical progress with Mia, our expectations for commercialization in a video of the procedure, as well as testimonials from women who have had the Mia procedure. If you haven't seen it, a recording of the webcast is available on our website and I highly recommend taking the time to watch it. We are creating a new category in aesthetics for women who don’t want a traditional breast augmentation but are conscious about the shape and proportions of their breast. Mia offers these women a minimally invasive procedure that can be performed without general anesthesia in less than 15 minutes with an easy return to their daily activities. The insights from the extensive consumer research we have completed show that many more women are interested in Mia than receiving a traditional augmentation today. In Japan, for example, our primary research showed 155,000 women are interested in Mia with 133,000 saying they are interested in getting the procedure in the next 12 months. Japan is a market where there are currently only about 5,000 traditional breast augmentations done every year. By providing a solution that is more appealing to consumers, we are opening up a whole new group of women to breast aesthetics. We plan to commercialize Mia in the first half of 2023. The recent regulatory updates out of the European Union on the common specifications around Annex XVI are encouraging. Our plans for entering the European market and other markets continue. We look forward to providing more updates over the coming months. As we announced in our second quarter call, all cohorts of our U.S. IDE study are fully enrolled and we are moving diligently through the follow-up. On the aesthetic cohort, as we previously communicated, we are pursuing a modular PMA submission path. All patients in the cohorts passed a three-year mark in August, and we continue to expect we will submit the fourth and final module to the FDA this quarter. In our Aesthetic Breast Recon franchise, the launch of our Motiva Flora tissue expander in Europe and other CE Mark countries is ongoing. Flora has many advances over other commercially available tissue expanders, including a first-of-its-kind RFID-enabled port that allows for MRI imaging without artifacts during the time an expander is used after mastectomy. By being non-magnetic, Flora potentially opens new options for radiation oncology treatment during this stage of recovery. Flora also features our patented self-friendly smooth silk surface technology and early users have noted improved patient comfort and healthier capsule formation with this unique tissue expander. We are expanding the markets in which Flora is available. Adoption will take time, but early efforts have been encouraging and add to our belief that we can help support women in their breast reconstruction journey. Surgeons are adopting our technology with many more making Flora their expander of choice. Flora is only the first step in our Aesthetic Breast Recon initiative where Establishment Labs will offer tools and techniques that allow women to receive reconstructive surgeries that achieve the aesthetic ideals to which they aspire. Our clinical and commercial efforts in China are ongoing and we continue to make progress in the regulatory process. We continue to expect approval for Motiva in this market in the first half of 2023. Before I turn the call over to Raj to cover our financial results, I wanted to note the publication last month of our annual post-market surveillance report, which is available on our website. The report, which we update every year, highlights the clinical and safety performance up to 2.5 million Motiva Implants in market over 12 years since we began commercialization in 2010. After more than a decade in the market, Motiva Implants continue to show less than 1% device-related complications leading to re-operation, including capsular contracture and implant rupture. Additionally, we have no reported cases of squamous cell carcinoma, which was recently noted by the FDA. These unprecedented clinical results are supported by the science behind our implants. In late October, Establishment Labs attended the American Society of Plastic Surgeons meeting in Boston. We hosted a symposium for surgeons where Dr. Robert Langer from MIT presented the results from the paper he co-authored on the implant surfaces. The paper, which was published last year in Nature Biomedical Engineering, showed that our patented SmoothSilk surface produces the lowest rates of inflammation in the healthiest capsules compared to other commercially available smooth or textured implants. Scientific research such as the work done by Dr. Langer and his lab provides the answer as to why our implants perform better than others. There are now more than 50 peer-reviewed publications about Motiva, and we look forward to more seminal papers like Dr. Langer's over the coming months and years. I will now turn it over to Raj.

Thank you, Juan Jose. Total revenue for the quarter was $38.2 million. Reported revenue growth in the third quarter was 31.7%. Foreign currency changes reduced our third quarter revenue by approximately $1.7 million. Excluding the impact of currency, revenue growth in the quarter would've been 6 percentage points higher, or 37.7%. Direct sales were approximately 38% of this total, while distributor sales, which can fluctuate based on changes in inventory levels and the timing of reorders made up the balance. From a regional perspective, sales in Europe comprised approximately 23% of global sales; Asia Pacific and Middle East was 44%; and Latin America made up the balance. Brazil, which is our single largest market globally, accounted for approximately 18.6% of total quarterly sales. The revenue distribution this quarter was impacted in part by foreign currency and more pronounced seasonality with the end of the pandemic. Both of these factors disproportionately affect our revenues in Europe where surgeons and patients take vacations in the summer months, and where we price our products in local currencies like the Euro and British Pound, while many of the markets around the world we price in U.S. dollars. Our reported gross profit in the third quarter was $26 million or 68.1% of revenue. This compared to 19.6% or 67.6% of revenue for the same period in 2021. Even with the negative effects of foreign currency exchange rates, overall average selling prices in the third quarter were up slightly from the second quarter of 2022. SG&A expenses for the third quarter increased approximately $6.5 million to $31.3 million. This compared to $24.8 million in the third quarter of 2021. The increase in SG&A in the third quarter resulted from continued normalization in business practices following the disruption from the global pandemic and our prioritization of investment in new growth initiatives like Mia and preparations for our launch in the U.S. R&D expenses for the third quarter increased approximately $1.4 million from the same quarter a year ago to $5.3 million. R&D expenses will fluctuate quarter-to-quarter based on the timing of clinical trials and other expenses. Total operating expenses for the third quarter were $36.6 million, an increase of approximately $7.9 million from the year-ago period. The increase during this period was again due primarily to the normalization of activity and spending relative to a year ago, as well as the investments in growth initiatives. Net loss from operations for the third quarter was $10.5 million compared to a net loss of $9 million in the year-ago period. Our cash position as of September 30th was $65.3 million, compared to $53.4 million at the end of the previous year. The increase in cash this quarter was the net result of the first $150 million tranche from the new term loan secured on April 26th. As a reminder, the term loan has three additional tranches totaling $75 million of additional non-dilutive capital we can access upon achieving revenue and regulatory milestones. With the revenue results in the third quarter, we have achieved the milestone necessary to draw the next $25 million tranche, bringing our currently accessible cash to approximately $90 million. Cash used in the third quarter included approximately $5.2 million of investments in our new manufacturing facility that will expand our capacity to produce more than half of the world's breast implants. We also increased inventories as we ramp up our purchase of raw materials. Overall, changes in working capital and investing activity, including expenditures in the new facility, reduced our cash position by approximately $17 million in the third quarter. Under our current forecast, the cash we currently have on hand, as well as the additional capital available to us under our credit facility, allows us to achieve cash flow profitability while still funding our growth initiatives. We are tightening our sales guidance for 2022 to a range of $158 million to $162 million representing estimated annual growth of 25% to 28%. This compares to our previous range of $155 million to $165 million. As we saw in our third quarter results, there is considerable momentum in our business and we expect this will continue. However, as we also saw in the third quarter, the steeper headwind from foreign currency is impacting our reported results. At current rates, we estimate a year-over-year currency impact of fourth quarter sales of approximately $2.5 million. In total, we now expect currency will negatively impact our reported revenue this year by approximately $6.5 million or 5 percentage points on full-year 2022 sales compared to 2021. As we look down the rest of the P&L, we expect to see spending levels increase as we prioritize investment in the significant number of development and commercialization programs we have underway. Preparing for the launch of Mia and entering the U.S. remain top priorities, while operating spending over the near term reflects our investments in these opportunities. We expect these expenses as a percentage of revenue will trend down over time. Overall, Establishment Labs remains in a very strong financial position to execute on our growth initiatives. And I will now turn the call back to Juan Jose.

Thank you, Raj. The launches of Motiva into the U.S. and China and the commercial launch of Mia are some of the many opportunities we have to positively impact women's breast health. Our company's mission is not limited to just aesthetics, and we are equally focused on the work we are doing to democratize access to breast reconstruction. One in eight women will experience breast cancer in their lifetime. While survival rates have improved, the disease can still have a devastating impact on women's lives. For those women who seek breast reconstruction surgery, the availability is low. Less than 10% of women globally approximately receive a breast reconstruction after a mastectomy, and the waiting times in some countries can be as long as 10 years. While our commitment to these initiatives is year-round, the month of October, which is breast cancer awareness month, is a time to redouble our efforts in awareness and understanding of breast cancer. This year, we were involved in events across all continents including awareness and educational campaigns, program sponsorships and partnerships. For example, we ran our annual Pink is for Power breast reconstruction program in Brazil. In partnership with a network of plastic surgeons, this year Establishment Labs provided the resources to allow 310 women in 18 cities across Brazil to receive a breast reconstruction, providing them access to healthcare they were unable to obtain for many years. I personally traveled to Mali where we are helping to establish programs in Africa to promote access to breast reconstruction and generate awareness about the importance of breast health and early detection. As a global medical device company focused on women's health, Establishment Labs has the opportunity and the responsibility to democratize access to breast reconstruction. Not only bringing to market technologies, techniques, and education that can improve clinical and aesthetic outcomes but also promoting education and awareness. We will continue to transform our markets and in doing so we will create new categories for growth, but more importantly, we are creating new options for women around the world and solidifying our credentials as leading the industry toward a sustainable future. I will now turn the call over to the operator for your questions.

Thank you. Our first question comes from Anthony Petrone with Mizuho Group. Please go ahead with your question.

Thanks and congratulations on another strong performance here in 3Q. I'll start with the Motiva U.S. timelines here, J.J. and I'll have a couple of follow-ups. Appreciate the updated timelines and confirming that the clinical module will be submitted before year-end here. Just wondering, it sounds like in the aesthetic cohort, the threshold for at least three years of follow-up data post-surgery is satisfied. So when we think about that threshold being satisfied and all the other modules in place, is there a pathway perhaps to mid-to-late 2023 U.S. clearance? Just wondering if we can tighten up that timeline a bit and then I'll have a couple of follow-ups? Thanks.

Yes, thank you, Anthony. And we are, of course, extremely happy that we have crossed that three-year mark, which is in the guidance from the FDA for the approval of silicone gel-filled breast implants. And we have confirmed that we plan to submit that clinical module this quarter. We are not going to speculate though on the date of approval. This is a process of continuous communication with the FDA, and of course, we will try to find the right scientific forum for the data to be shown at the three-year mark. However, again we cannot speculate on the timing of approval. We are always very good at responding as quickly as possible and doing everything that we can not to slow down the process, but we are dependent on a foreign external entity like the FDA.

No. I appreciate that. And a couple of follow-ups, some pivot to Europe; two-part question for you, J.J. would be, are you seeing any evidence of a demand slowdown just due to some economic constraints in Europe as certain regions? There seem to be a few months ahead of let's say the U.S. as it relates to recessionary and even inflation pressures. On the flip side in Europe, it's still heavily tilted towards textured implants. So wondering if you have an update on the mix between textured and smooth as it relates to overall volumes as we get to the end of 2022; and how quickly do you think it could shift over to smooth into 2023? Thanks again.

Thank you. And we are watching the developments in Europe closely. Definitely there is concern in Europe regarding what's going on with Ukraine and all of that, but there is no reason to believe at this point that this is going to have a significant impact on the aesthetic market. I would say that in this last quarter we were impacted by currency with the British pound, and also the Euro, and these Scandinavian currencies being hit. But on the other hand, just like you said, we do have a lot of accounts who are still to be targeted. Many of them are using textured, and this is the opportunity for us because when you look at our rate of growth, at plus 30%. What you see is fundamentally a change in the shares of the market that we are taking in all of these markets. So if the market is growing at roughly 3% and we are growing at 30% plus, what that means is that we continue to do our job effectively. Medical education being back is a big thing for us because that means that we can impact directly a lot more accounts than we did before. So in most of Europe, we are direct and we plan to continue working hard to make sure that we are getting more market share.

Appreciate that all. I'll hop in queue. Thanks.

Our next question comes from Josh Jennings with Cowen. Please proceed with your question.

Hi, good afternoon. Thanks for taking the questions and congrats on another strong quarter. Wanted to just ask a follow-up on the U.S. FDA approval process. Just a more structural question about the modular submission process; once you have the first three modules submitted and the clinical module is the last module that you will submit, and then kick off the PMA review time. So we assume that those first three modules have been reviewed fully by the FDA and you will only receive questions on the clinical data package, or is this start from scratch where the FDA could come back and ask questions about the first three modules as well?

Thanks, Josh. This process is continuous and they can always ask questions, and we have had questions from different modules at different times. I think the FDA is in a situation in which they have to deal with a lot of things simultaneously. So what we are seeing is them trying to get all of these things done. So we actually appreciate a lot the fact that they're moving on all three modules. So we expect that to continue, and we expect to submit our fourth module and this way get going with the final process of the PMA.

Understood. Thanks. And then just one follow-up on just thinking about the U.S. commercial effort and build-out of the sales infrastructure. I may not be ready to talk about that. But any high-level kind of clues on the strategy there or any timing about when you'll be ready to share the commercial strategy for the U.S.? Thanks for taking the questions.

Yes. On that one, we actually started when we hired Heather Brennan as the Head of our U.S. market. Furthermore, we have been adding other people to create the structure necessary for our U.S. launch. What we have not done yet is begin hiring commercial people because we are cognizant of the process that we are undertaking with the FDA. We will continue to work towards the launch. You saw us in Boston at the plastic surgery meeting, and we hosted a symposium for plastic surgeons and investigators. We had Dr. Robert Langer there speaking about his work on implant biocompatibility, and that shows you that we are active, but we have to be mindful not to promote ahead of the approval of Motiva Implants.

Our next question comes on the line of George Sellers with Stephens. Please proceed with your question.

Thanks for taking the question and congrats on the quarter. You mentioned expectations for Mia commercialization to begin in Europe in the first half of 2023. So I just wanted to ask about any update on the MDD to MDR transition and the Annex 16 requirements and what you're sort of incorporating as we think about that commercialization timeline?

Yes. Thanks, George. We are moving on all fronts. The only thing that was pending was basically the publication of the Annex 16, which is expected to happen this month. Now that the common specifications have been approved by the European authorities, we plan to move ahead full steam and get going with the different areas that are necessary for C-mark of the tools, having had the approval for the implants a couple of years ago. Now, we are also making progress in other markets. We are currently in Japan, taking this call because we continue to work with our local partners here in Japan, local clinics towards the preparation of the launch. So it's an exciting time. We are doing cases of Mia this week here in Japan. These are early experience cases, but it shows you how we continue to progress with Mia and we're very happy about that.

Okay. That's really helpful. And then as we think about the approval and commercialization of Mia in Europe and elsewhere, could you help us think about any additional infrastructure you need there in terms of the sales build-out or anything else we should be aware of as you commercialize Mia?

Yes. One of the great things about Mia is that it's a true direct-to-consumer model. So there are no sales reps. What we are adding is this consumer business unit that is dedicated to communicating with consumers in different ways. This is something we've already built, so we continue to progress with their work necessary for creating all the messaging and everything that makes Mia a new category in breast aesthetics. For instance, again this week we're here in Japan. We're working with a local agency specialized in this type of messaging, and we plan to make sure that we are messaging correctly in every single significant market.

Our next question comes on the line with Marie Thibault with BTIG. Please proceed with your question.

Good evening, or maybe good morning for you early morning there in Japan. Congrats on a nice quarter. Wanted to hear a little bit about Asia, the APAC region, I know that you were just in Thailand recently for your world symposium. So I would love to hear how turnout was for that event, and then which countries are strong on the recovery path and maybe which are lagging on the recovery path in APAC?

Yes, we had our annual world symposium on the ergonomic implants. We hosted it for the first time in Asia. It kind of tells you how we see the Asia region growing, and it's the area with the fastest growth for us. It's also an area where we see great opportunities with Mia. So definitely we are very excited to see hundreds of plastic surgeons from around Asia Pacific and also from other parts of the world, but mostly from Asia Pacific. What we see is that we continue to gain market share all over Asia in every single one of the markets that we are in. Our partners are strong; they have a special relationship with the plastic surgery community in those markets, and I think it really shows how our product offering shines in this region. In terms of country to country, we don't give specific data country to country, but what I would say, Marie, is that either we are market leaders or on the path to leadership short term in every single one of the markets that we participate in.

Okay. That's very helpful. Thank you for that. Then I wanted to touch briefly on your comments on the Flora tissue expander. You mentioned some work in various countries. Can you tell us a little bit more about what that rollout has looked like so far? Any learning so far? I know that it's a process to sort of change the breast reconstruction market. So any more detail there on what countries and where you're thinking of expanding and any learning thus far? Thanks so much.

Yes. I think the focus for us is always on safety first, and that is more so in the breast reconstruction market. So the fact that we can bring to women in breast reconstruction the possibility of doing an MRI during the expansion process, that they have more comfort and less pain and the possibility of reducing radiation oncology levels are all important to us. Just in this meeting in Thailand, one of the scientists that has been involved with Mia conducting an independent study comparing our device to another CE Mark device, showed the results from her research in which patients are responding clearly that this is a much more comfortable option. And that's the type of thing that we want to hear because what we want is for breast reconstruction in the future to be viewed through the eyes of women who have suffered breast cancer and after a mastectomy can get better options for reconstruction.

Our next question comes on the line of Matt Baylor with Jeffries. Please proceed with your question.

Hi guys. Thanks for taking the question. I wanted to ask a follow-up. In the press release, you reiterated the China approval and launch expectations in the first half of 2023. I was wondering if you could talk about your visibility into that and when we could see that start, anything that you're doing to prepare for the launch there?

Yes, part of our trip here to Asia has been devoted to updates on our different regulatory timelines around Asia. Not only on Motiva Implants, but also on Mia and Flora. So we met with our partners in China and we have reinforced our belief that we will get approval in the first half of next year. Again, the process with the Chinese regulatory authorities is not fully transparent. There's quite a degree of passage in the communication always, but that's natural to that process. So we are not concerned about it and happy to hear from our regulatory experts in China that they stand by that date.

Okay, great. And I wanted to ask a follow-up on you sort of mentioned in the past that the facility that you're building is going to be able to produce half the world's breast implants, I think you said. So, I wanted to kind of tie that back into your confidence and what you're seeing in some of these other markets where you've been for a while and starting to see market leadership. So, I guess all that said, could you give us some examples of where your market share, your leadership is going today in some of these markets where you've been and to give you that confidence to, I guess, get to half the world's share in that facility over time?

Yes, I think the way to think about it is that this market for many decades was led by two big companies basically, Mentor and the breast division out of Johnson & Johnson and Allergan. Once Allergan retreated from most of these markets, but the four markets where they compete with Motiva, market leadership tends to look different. There are markets already where we have surpassed 50% and continue to grow. That shows you what technology that is substantially different can do. And I think that's our job: to make sure that market leadership can be as high as possible. Remember, one of the biggest things that we do is expand markets and we have a lot more work to do, but we actually believe that the fact that you improve the safety levels has an impact in expanding markets. It might take longer to see, but it is there. Then you have initiatives like Mia, which really speak to new consumers. When we think about what we've been doing over the last couple of days here in Japan, the excitement level from the potential launch of Mia is high, and the local partners and clinics understand very well that this can be a major game changer in breast aesthetics in Japan.

And Matt, I would just offer too that, we are poised to enter two of the largest markets in the world, in the United States and China, so that capacity is needed for those initiatives along with the continued share gains we're making in other markets around the world.

Our next question comes on the line of Neil Chatterji with B. Riley. Please proceed with your question.

Yes. Thanks for taking the questions. So maybe just on Mia Femtech, I guess for the countries where you've already started to receive the regulatory clearances, I believe it might have been Latin America and Asia. Just curious if you could talk about the early experiences you are seeing there in those regions? And then also perhaps if you have an update on the potential launch in Japan and your clinic partner strategy there.

Yes, to be clear, we have not launched in any country. We have been doing early experience cases in Latin America and in Japan. Our plan is to continue to use those insights from patients that have undergone the procedure as part of our work towards the launch. I'll give you an example. We had an engineer who had the procedure on Tuesday, as you saw in the Mia Investor Day, and got married on a Saturday. Her testimonial is so strong because there is basically no stigma of any type around the procedure, and she enjoyed a big day in the most profound way. This is like what we are about. We are working towards expanding markets, and we just have to be patient for the launch. But when it happens, I think you'll notice that this is a true new option. The consumer insights that we are gathering are strong, and we continue to have both qualitative and quantitative analysis that we will share in due time.

Got it. And maybe just one quick follow-up, just in terms of the kind of the ASP strategy. I think in the slides from the Mia Day, it kind of gave a range of like $2,500 to $3,500. So just kind of curious around the assumptions around that if that's kind of related to the regional nuances or what that's based on?

Well, it's based on willingness to pay analysis, and this is conducted market-to-market. We don't want to under-price or price out consumers. So that's the work around that. Of course, we're always going to try to do as best as possible, but that's why we are always conservative on our pricing when it's given in this fashion.

And I think Neil, you probably appreciate too in the slides that we presented and talked about that day, that if you look at the economics for the surgeon at those price points, given the speed at which they can do the procedure, the efficiency at which they can run their practice if they have devoted time to Mia, even at those price points, it still represents quite a bit of value to the surgeon. I think it's a question of finding that sweet spot that creates value for us as a company, for our partners and surgeons, and absolutely for the women who received the procedure.

Our next question comes from the line of Amit Hazan with Goldman Sachs. Please proceed with your question.

Thanks. This is Phil on for Amit. I thought I'd ask some kind of directional preliminary questions on 2023. So I think the first one, hopefully we can – pretty simple on the currency front most are giving at least a preliminary look for next year is the kind of six to seven range that's going to end up shaking out for this year a good place to start for the headwind for next year as you guys see it?

Yes, I mean, obviously there is a lot of – currency is fluctuating right, but I think as a start that is not a bad place to be. We'll see more pronounced impact obviously in the first part of the year. But yes, I would also suggest we'll give a lot more detail and a lot more guidance around 2023 when we report our fourth quarter numbers.

Yes, absolutely. That's helpful as a starting point. And then on the OpEx side, it looks like for the year you're going to end up growing SG&A a bit ahead of where total sales numbers are going to be, even on an underlying basis with all of the investments that you're making for next year in the U.S. and in China. Is that growing SG&A similar or ahead of sales a reasonable starting place for next year with all the investments that are going on?

And again, all of these plans are in development, right as we think about budgeting for 2023 and what the year looks like. But I think you are directionally thinking about it correctly, right, that the next several quarters are going to be periods of investment for us as a company, right? As we stand up – Mia as we stand up the U.S. operation, this is not a time we will see significant leverage from us. However, as those opportunities start to materialize, Mia next year, and in the U.S. hopefully not too long after that, the leverage will start to show in our model. But I think you are thinking about it correctly in that the next few quarters are not quarters where we're expected to show a lot of operating expense leverage.

Okay, that's helpful. If I could sneak one last one, Raj, I believe you said 23% European sales and 44% for the APAC region. I know the questions have been asked about the regions already, but I'm wondering if there's anything one-time to call out either from a distributor standpoint, APAC that was a pull forward or from Europe that you would highlight to the negative side. Just kind of trend lines a little bit off. Thanks.

Yes, I was the one who mentioned. I mean, Europe obviously that number is being impacted quite a bit from currency. That's the major thing, pushing that number to that 23%. We're also seeing stronger seasonality, I think, in Europe. So really nothing one time, I think the business is doing very well. We're still taking share in most of our markets, so I wouldn't call that anything specific in terms of one time there. And Asia-Pacific is one, as I mentioned, we're seeing very strong growth, the traction with implants and the move to Motiva in a lot of these markets continues. So I think it's again, currency kind of impacting Europe and then just really good growth in a lot of other markets. Good demand.

That is all the time we have today for questions. I would now like to turn the call back over to Juan Jose Chacon-Quiros for closing comments.

Thank you for joining us on today's call. We look forward to providing our next quarterly update in early 2023, and we wish everyone continued good health.

This concludes today's conference. You may disconnect your lines at this time and we thank you for your participation.

Great. Thank you, Raj. I hope you are still there.

Yes, goodbye.