Greetings, and welcome to the Edwards Lifesciences First Quarter 2021 Results Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. Please note that this conference is being recorded. I will now turn the conference over to our host, Mark Wilterding, Vice President of Investor Relations. Thank you. You may begin.

Thank you, Diego. Good afternoon, and thank you for joining us. With me on today's call are Mike Mussallem, Chairman and Chief Executive Officer; and Scott Ullem, Chief Financial Officer. Just after the close of regular trading, Edwards Lifesciences released first quarter 2021 financial results. During today's call, management will discuss those results included in the press release and accompanying financial statements and then use the remaining time for Q&A. Please note that management will be making forward-looking statements that are based on estimates, assumptions, and projections. These statements include, but aren't limited to: financial guidance and expectations for longer-term growth opportunities, regulatory approvals, clinical trials, litigation, reimbursement, competitive matters and foreign currency fluctuations. These statements speak only as of the date on which they were made, and Edwards does not undertake any obligation to update them after today. Additionally, the statements involve risks and uncertainties, including, but not limited to, those associated with the pandemic that could cause actual results to differ materially. Information concerning factors that could cause these differences and important product safety information may be found in the press release, our 2020 annual report on Form 10-K and Edwards' other SEC filings, all of which are available on the company's website at edwards.com. Finally, a quick reminder that when using terms underlying and adjusted, management is referring to non-GAAP financial measures. Otherwise, they are referring to GAAP results. Reconciliations between GAAP and non-GAAP numbers mentioned during this call are included in today's press release. With that, I'd like to turn the call over to Mike for his comments. Mike?

Thank you, Mark. As we anniversary our one-year impact of the pandemic on our financial results, I'd like to briefly reflect on the current environment and discuss our 2021 and longer-term priorities as a company. I'd also like to touch on Edwards' response to the pandemic and our efforts to better support our patients, employees, and the community. Recall that our sales were dramatically impacted in the last few weeks of Q1 2020 as procedures fell due to COVID disruptions. One year later, after an extraordinarily difficult global crisis, I'm encouraged by the signs of recovery, and although we recognize that many people are still struggling around the world. Our sales growth this quarter was better than expected across all product lines. Although we expect the pandemic will impact the global healthcare system, based on the environment as we exited the quarter, we have continued confidence in our positive 2021 outlook.

Thanks, Mike. Well, we are encouraged by the start to our year. Despite COVID still impacting the global healthcare system in the first quarter, we were able to post positive year-over-year sales growth across all our product lines and regions as our advanced therapies helped patients globally. Total sales grew 5% year-over-year on an underlying basis, which was better than the flat growth we expected when we gave guidance for the first quarter back in January. This stronger-than-expected sales performance flowed through to the bottom line, resulting in adjusted earnings per share of $0.54, which was 8% higher than the first quarter of 2020. The improvement in our sales performance during the quarter was choppy, but we exited the quarter in a stronger position, and that gives us continued confidence in our outlook for the balance of the year. While macro conditions remain variable across our key geographies, we're projecting total sales in the second quarter to grow sequentially to between $1.25 billion and $1.33 billion, resulting in adjusted earnings per share of $0.54 to $0.60. As our business continues to rebound from the impact of COVID, we expect sales to strengthen and expenses to grow as travel and clinical trials ramp up. We are maintaining all our previous sales guidance ranges for 2021. For total Edwards, we expect sales of $4.9 billion to $5.3 billion; for TAVR, $3.2 billion to $3.6 billion; for TMTT, approximately $80 million; for Surgical Structural Heart, $800 million to $900 million; and for Critical Care, $725 million to $800 million. And based on our first quarter earnings, we are raising full-year adjusted earnings per share guidance to $2.07 to $2.27, up from $2.00 to $2.20. So now I'll cover additional details of our results. For the first quarter, our adjusted gross profit margin was 76% compared to 76.7% in the same period last year. This reduction was driven by a negative impact from foreign exchange and incremental costs associated with responding to COVID, partially offset by improved manufacturing efficiencies. We continue to expect our 2021 adjusted gross profit margin to be between 76% and 77%. Selling, general and administrative expenses in the first quarter were $331 million or 27.2% of sales compared to $308 million in the prior year. This increase was primarily driven by the strengthening of OUS currencies, primarily the euro, and personnel-related costs, partially offset by reduced travel spending resulting from COVID. As I mentioned earlier, we anticipate our spending will increase during the year as travel restrictions subside and we resume a more normalized operating environment. We continue to expect full-year 2021 SG&A as a percentage of sales, excluding special items, to be 28% to 29%, similar to pre-COVID levels. Research and development expenses in the quarter grew 10% to $207 million or 17% of sales. This increase was primarily the result of continued investments in our transcatheter innovations. For the full year 2021, we continue to expect R&D as a percentage of sales to be in the 17% to 18% range, similar to pre-COVID levels, as we invest in developing new technologies and generating evidence to expand indications for TAVR and TMTT. Turning to taxes, our reported tax rate this quarter was 13.1%. This rate included a 290 basis point benefit from the accounting for stock-based compensation. We continue to expect our full-year rate in 2021, excluding special items, to be between 11% and 15%, including an estimated benefit of 4 percentage points from stock-based compensation accounting. Foreign exchange rates increased first quarter reported sales growth by 280 basis points or $30 million compared to the prior year. At current rates, we now expect an approximate $60 million positive impact or about 1% to full-year 2021 sales compared to 2020. FX rates negatively impacted our first quarter gross profit margin by 150 basis points compared to the prior year. Relative to our January guidance, FX rates positively impacted our first quarter EPS by about $0.01. Free cash flow for the first quarter was $195 million, defined as cash flow from operating activities of $301 million, less capital spending of $106 million. Before turning the call back over to Mike, I'll finish with an update on our balance sheet and share repurchase activities. We continue to maintain a strong and flexible balance sheet with approximately $2.1 billion in cash and investments as of March 31, 2021. We repurchased 3.6 million shares for $303 million during the first quarter and have approximately $300 million remaining in our share repurchase authorization. We plan to continue to execute our strategy of offsetting dilution from incentive stock compensation as well as opportunistically reducing our shares outstanding over time. Average shares outstanding during the first quarter were 631 million, down approximately 1 million from the prior quarter. We continue to expect average shares outstanding for 2021 to be between 630 million and 635 million. So with that, I'll pass it back to Mike.

Thanks, Scott. We remain confident in our long-term patient-focused strategy and our innovation pipeline. To serve the many patients separate from structural heart disease, we have never stopped investing in our people, our innovative technologies and our new growth capacity. As a company, we expect that Edwards will be positioned even stronger and in a position to help more patients than ever as the world fully emerges from this pandemic. So with that, I'll turn the call back over to Mark.

Thanks, Mike. So Diego, with that, we're ready to take questions now. In order to allow for broad participation, we ask that you please limit the number of questions to one, plus one follow-up. If you have additional questions, please re-enter the queue and management will answer as many participants as possible during the remainder of the call. Diego?

Thank you. Our first question comes from Bob Hopkins with Bank of America. Please state your question.

Oh, great. Thank you and good afternoon. One thing that I'd love to get your view on is that it kind of stood out in the quarter is the TAVR growth rate you guys put up in the first quarter outside the United States and especially outside the United States and excluding Europe, given some of the numbers you gave us. So I was wondering if you could just talk a little bit more about that. And specifically, was Japan and maybe China really strong in the quarter, Mike? Just love your take on what happened outside the U.S. this quarter with TAVR.

Yes. Thank you, Bob. That's a correct observation. Clearly, OUS did pull our performance up in the quarter. And even though Europe grew nicely, most of this came from Japan and other countries. And so Japan was pretty significant in size. And so it really was a meaningful contributor to growth. But it certainly wasn't alone. You could go across many other countries, such as Australia or Korea, and these places in the world where it’s underpenetrated. And we just don’t have TAVR rates where they should be at. We’re really strong growers. Some of that may have been that they were impacted earlier by the pandemic, so the year-over-year comparisons are a bit stronger. But frankly, the numbers were just up. We continue to see that therapy grow in those areas. China, we're very early in that game. It was not a meaningful contributor to those results, so it's really not a factor.

Okay. I mean one quick follow-up on that is just, was there anything in particular that you think that gave you better results in Japan this quarter? And then on Europe, I'm just curious, did Europe get worse over the course of the quarter, just following what happened with COVID? Or was it pretty stable? Or did it improve like the U.S.? Just curious on that.

Yes. So in Japan, there was no specific thing that drove this. We've been focused in Japan for many years, and actually, somewhat disappointed that adoption rates haven't been higher. And so this has been a long-term and consistent effort, and it's really nice to just continue to see the adoption. We are glad to see this approval for low-risk in Japan that will start having some meaning later on in the year. In Europe, it was interesting. It was kind of choppy, I would say, not consistent across all countries. We still saw the countries that were less penetrated probably have a little bit more growth in those countries that have traditionally been strong. If you looked at it through the course of the quarter, it exited pretty solid, I think, similar to the overall growth rate of the quarter. So I don't think there was anything notable there, Bob.

Great. Thanks for taking the question. Very helpful.

Our next question comes from Robbie Marcus with JPMorgan. Please state your question.

Great. Thanks for taking the question and congrats on a good quarter. Maybe the opposite of Bob's question in the U.S., it'd be great to get a sense of sort of the trends you're seeing, how the quarter went and especially with so many of the adults, particularly the 65 and older population now fully vaccinated. Are you starting to see trends improve there? And then maybe I'll just ask a second question upfront. I've heard from a lot of doctors throughout the COVID time that the time from diagnosis to screening to treatment with TAVR is starting to compress. I want to see if you're seeing that on a company level, and if so, is that a durable trend? Thanks.

Okay. So let's talk about the U.S. The U.S. did improve during the course of the quarter, no doubt about it, but we would call it choppy. It wasn't straight up. For example, things were tough in January and February, and clearly got better in March. Although when you got toward the back end of March and you had spring break, you felt that effect as well. But clearly, an upward trend. I remember the kind of roller coaster that we went on, Robbie, when we first put out the TAVR estimates of 15% to 20% growth in our December investor conference, we were feeling pretty good about it. When we got to the end of January and reported Q1, we were saying, well, we're still in that range, but probably we're a little lower in that range just based on what was going on. And then here they went and recovered nicely. So we feel confident about the 15% to 20% range going forward. So hopefully, that helps you get a sense for the U.S. In terms of the question about whether it’s easier, all hospitals are not identical in the way that they screen patients. Although some are more efficient and getting more efficient, others are more challenging. And one of the things that happens when you have COVID, in addition to all the tests that you run through, you also have to do COVID tests before you would come into the hospital. So it just becomes a hassle for these patients in addition to just the fear factor. I wouldn't say it's uniform. Overall, hospitals will get a little better, but it's still a battle. The good news is length of stay is coming down. Hospitals are clearly improving in that regard. Maybe some of that is COVID driven, but it seems to be a trend as well.

Great. Thanks for taking the questions.

Our next question comes from Vijay Kumar with Evercore ISI. Please state your question.

Hey, guys, thanks for taking my question, and I had two. Maybe I'll start with the first on the guidance here. Mike, on your comments on 15% to 20%, in January, you felt perhaps low end seems more appropriate. You just beat Q1 at the high end, it looks like procedures have come back. So I'm thinking, should we be looking at the high end of the guide? And I think that 15% to 20%, just to put a finer point that, that's versus last year's guide, right? If you look at the actual TAVR revenue numbers, I mean, this is more like a 16% to 26% growth off of actual fiscal 2020 TAVR numbers?

Yes. No. Thanks, Vijay. We feel pretty good about the fact that we're putting pretty specific guidance out there in the first place. And guidance is not that simple during the age of COVID. We do feel better about it. We probably would tend to guide people more towards the middle of the range, Vijay. Of course, it's possible for it to be higher or lower. This is somewhat dependent on your perspective about COVID. Even in the U.S. or certainly across Europe, if COVID is more challenging, it will put pressure on our numbers. If vaccinations go nicely and we start winning the battle against COVID, it helps us trend towards the higher end. But I feel like there's pretty balance in the guidance that we tried to advance.

Understood. And then I did have one, perhaps more a bigger picture question, Mike. I guess the question we've gotten is, how derisked is mitral? Because if I had to make a thesis, mitral is going to be a really big TAM, much bigger than TAVR. I guess the question was, look, you've had COAPT versus MITRA-FR, patient selection matters. Then when I look at your trials, you have two different trials on the replacement side, SAPIEN M3 and the EVOQUE. Is that a two-valve strategy? Is that perhaps Edwards trying to take a portfolio approach? Are these valves different? Or I guess I'm trying to ask how derisked is mitral? Are we at a point where we know exactly what patients we need to select, and this is just a question of time before mitral ends up being much larger than TAVR?

Thanks for that, Vijay. Well, you can probably get a sense of how dedicated Edwards is to pursue transcatheter mitral and tricuspid. We really think it's a big opportunity. We think it's within our reach, and we think the time is right for us to go after it and we're going after it with a lot of energy. You know we're pursuing it with a toolbox. To say it's derisked would be overstating the situation at this point. It certainly is not derisked. There's leaflet therapy out there right now that has a fair amount of data around it, but there is still limited data on replacement and tricuspid. Each time you see results from these trials, and you see them actually in human use, you start to see more and more derisking and more clarity, and frankly, more clarity on which patients are appropriate for which therapies. I would say that's not fully known at this point. We have some pretty good ideas, and maybe we know more than most because we have so many technologies advancing in this space, but there's still more to learn. I'll turn your attention mostly to these big clinical meetings where the results from mitral and tricuspid trials will be reported to get a sense of us getting a better understanding of the opportunity.

Our next question comes from Larry Biegelsen with Wells Fargo.

Mike, one on early TAVR, one on TMTT. Just on early TAVR, just a clarification, Mike, I thought I heard you say earlier that you expect to complete the trial in 2021. Maybe that's just enrollment, but the clinicaltrials.gov was just updated in April, and it says the primary endpoint will be reached in December 2021. So my question is, can you just tell us kind of what the status is on enrollment and when we could expect to see a data readout there? And I have one follow-up.

Yes. Sorry if there was a lack of clarity on it. What I meant to infer is we're striving to achieve enrollment completion by the end of 2021. You may have also gotten from my comments that enrollment was a little lighter than we like in Q1, which anticipates actually that we're going to have increased enrollment as the year goes on and COVID gets a little more under control. So we're working hard to get there. Remember that there's a two-year endpoint on this trial as well.

That's helpful, Mike. On TMTT can you talk a little bit more? You seem to be getting nice traction there, a little bit more about what you're seeing in the mitral and tricuspid business. I don't know if you're willing to kind of split out mitral and versus tricuspid. But any color you're willing to provide would be helpful.

Yes, Larry. Yes, at this point, clearly, there's more sales in mitral than there is in tricuspid. Tricuspid is pretty new still, and there's been a pretty impressive ramp in tricuspid. We're pleased with what we're seeing. We think the opportunity is a nice one, but still, the opportunity is, at least in terms of sales right now, is to a great majority related to mitral. There's still more centers that are doing this. For Edwards, activating sites is important—very careful training to ensure we get great outcomes. Those are all critical success factors. But I don't know if that helps answer your question.

Our next question comes from Josh Jennings with Cowen.

And congratulations on the strong start to the year. I have two questions on TAVR. The first one, just on low-risk bicuspid, the PARTNER 3 bicuspid registry data has been made public. I just wanted to get a sense of, from you, if your team is relaying the penetration of TAVR into the low-risk bicuspid opportunity, where it sits and with the registry data on hand now? And where can that go? The follow-up question is just thinking about the replacement cycle for TAVR. I know it's still very early, but as younger patients are getting implanted with TAVR and the TAVR opportunity out in the out years, maybe even past 2024. But Mike, do you mind just framing what needs to be done clinically to bring TAVR and SAVR into a place where TAVR and SAVR sits today?

Yes, Josh. So let me take a shot at this. Overall, we're pleased with our bicuspid data. I don't have anything specific to break out to share with you. We routinely treat a lot of bicuspid patients. I think what will be interesting is what we mentioned in this upcoming meeting, I believe it's EuroPCR. You're going to see a report of a pretty significant registry of patients that are bicuspid and have been treated with transcatheter technology. So that should be an interesting data point and help give you some good insight. That's coming up in the next couple of months. In terms of where we are in the journey for TAVR versus SAVR, clinicians are beginning to talk more about planning lifetime therapy, right? What should be for a given patient, given their age and disease, what should be the first treatment? What might be the second? Should it be surgery first, TAVR second, SAVR first, then surgery, then another TAVR? Those are all very active discussions now. I think there's been some strong evidence that says TAVR and TAVR is effective, as well as TAVR in SAVR. Both are proven to be realistic options. Now it’s trying to determine for any given patient what the best therapy is. This is on the podium pretty regularly, and I think we're on a steep learning curve in that regard.

Our next question comes from Cecilia Furlong with Morgan Stanley.

I guess I wanted to start off with TMTT again and just really, as you're expanding in Europe and you think about the $80 million in 2021, really what's coming from kind of further account penetration versus account expansion as you factor that into your guidance?

Yes, thanks, Cecilia. The short answer is, I'm not sure. Clearly, more sites is an important component here. I also know that there's an increase within the existing sites. But probably site expansion is the biggest part of that if you had to pick one versus the other, given the outcomes.

Okay. Great. And I guess I did want to turn back to TAVR in Japan and just what you're seeing there. Really just ahead of low-risk reimbursement, if that has changed dynamics in terms of just interest versus kind of what you've seen historically and that being kind of a driver of recent strength?

Yes, Cecilia. Yes, we believe that clinicians and the environment in general is pretty disciplined in Japan and that clinicians do treat to approved guidelines. We don't think that there's a lot of low-risk that's in the current numbers. We expect that to be a positive boost. Having said that, as we've talked about before, treatment rates in Japan compared to where they should be are just low. There are almost as many elderly in Japan as there are in the United States, but it's still dramatically less treated. We still have work to do. There's still potentially a lot of upside there. We're pleased to see the growth rates, but we're not pleased with the penetration rates yet.

Our next question comes from Matt Miksic with Credit Suisse.

So I'm hoping, Mike, you could shed some light on just a couple of dynamics that we get questions about often and how they potentially affect the growth of the TAVR business globally and especially in the U.S. So these two things, and I'll keep it to one question are first, the idea that TAVR somehow benefited during COVID, this idea of a preference for TAVR or SAVR, driven by length of stay and that potentially maybe that rolled back towards SAVR over time somewhat? And then the second is sort of what you've contemplated in terms of—I mean you gained a fair amount of share from your largest competitor over the past 1.5 years or so—how much you've contemplated sort of having to feed that back and maybe what you've seen on that front so far as it compares to what you've assumed?

Yes. Well, thanks, Matt. So a couple of things. I mean clearly, we've heard clinicians and hospitals talk a lot about their focus on length of stay and how helpful it is if they don't have to utilize their ICU or have patients that stay in the hospital. Having said that, I would say that if you took the U.S. mix, for example, of TAVR versus SAVR, that during the pandemic has remained relatively flat. We really haven't seen TAVR versus SAVR or vice versa advantage very much during the pandemic. It's been pretty stable. It's difficult to know if that's COVID-related or if it's just a sign of the times, but that's the observation. You also asked— the second part of the question was about share. Yes, we feel pretty good about our competitive position. We're really pleased with the performance of SAPIEN 3 Ultra; it's demonstrated not only to be easy to use but has low complication rates, and its length of stay has been remarkable. People have really been able to count on it during the pandemic. I don't know anything that's going to change that. We'll continue to be aggressive innovators and will continue to advance the state-of-the-art. We’ve received a lot of positive feedback from clinicians.

Our next question comes from Joanne Wuensch with Citibank.

And nice quarter. Is there a way to quantify the backlog of patients that have cut off a procedure during COVID-19?

Yes. Thanks, Joanne, it's a tough one. We do think about that a lot. In general, we don't think that there's a significant backlog of patients. Clearly, it's variable across centers. There might be some centers actually that have some, but we don't think that that's significant. More of what we found during the pandemic is that when centers have a capacity problem impacts their implants, it also tends to impact their screening. So you don't necessarily build a backlog. They tend to move more or less in parallel. So it's not one that tends to drive a big backlog.

And as a follow-up question, I'm sort of curious what you're sort of seeing in terms of the clinical trials. It sounds as if you've restarted many of them; are they back to what I would call sort of normalized run rate in terms of enrollment?

Yes, Joanne. Yes, we never officially stopped any clinical trials. They were clearly slower in the first quarter, and that was a factor. Interestingly, the CLASP IID trial actually enrolled pretty nicely in the second quarter. So it wasn't uniform. Most of our trials were impacted. We think that the clinicians we're working with, they're eager to get back at it. To say we're back at pre-COVID rates, I think would be an overstatement. I think we should start building back up again. The regulators have been pretty good thought partners in this as we try and react to what COVID has done to clinical trials.

Our next question comes from Danielle Antalffy with SVB Leerink.

Mike, I have one TAVR question and one PASCAL question for you. First, on TAVR in Japan, so you've talked a lot about how Japan has sort of—I don't know, has underperformed your internal expectations, is the right way to think about it. But what is going on there? And what is—like what's going to change the tide in a meaningful way in Japan? And then again, just one quick follow-up on that.

Danielle, it's multifaceted in Japan in terms of what's going on. We think there needs to be more centers in Japan, among other things because in many cases, patients like to stay within their own region to get treated, and we don't have TAVR centers in all regions. There still is some pretty high requirement for TAVR centers to begin in Japan. They have to be cleared by an external panel. It's not just between us and the clinicians. We're hoping that low-risk has the possibility of being a catalyst to help along the way and simplify this journey for clinicians and patients.

Okay. That's helpful. And then on PASCAL, big catalyst potentially coming next year with the late 2022 U.S. launch. What can you talk about as far as learnings in Europe as you're opening new centers? I mean has your progress in Europe— I appreciate COVID has had an impact here, but has your progress in Europe given you sort of a blueprint for what you might—how you might approach the U.S.? Maybe talk a little bit about that, if you could?

Sure. Yes, you're right, Danielle. Naturally, we're learning quite a bit in Europe, as you might imagine. What we stay focused on, and I think we've been pretty vocal about this, is trying to maintain a really, I'll call it, a high-touch model. So we stay very close to clinicians, trying to help to ensure that they have terrific outcomes, that they're very well trained, and that they get incredible results. We think we can't do anything more important than that to really drive adoption of the therapy on a long-term basis. We're optimistic about the U.S.; it's very large. Even though things have been—we've had nice growth in Europe. The pandemic doesn't make it easy. You can imagine the biggest user of this technology is Germany; when Germany goes through tough times, it doesn't make it so easy. So we're a bit dependent on this. But we're going to apply much of the same strategy in the U.S. that we apply in Europe.

Our next question comes from Anthony Petrone with Jefferies.

Congratulations, strong start to the year. I'll have two questions on—I'll ask upfront. The first would be on early TAVR for asymptomatic patients. Just wondering to get—if you could provide some high-level comments on sort of the latest view on the asymptomatic opportunity. And then once we sort of get there in the next year or so with data, how influential the findings from the study will be at opening up asymptomatic.

We think this is a really important trial. One of the obstacles for patients to be treated is that they can have severe aortic stenosis. If there's uncertainty about whether they have symptoms, then they’re not treated because that's what guidelines say; assessing and identifying symptoms is a very sketchy game. It's subject to a lot of misinterpretation. If we took that requirement out of the equation, we think it would be meaningful. If you could simply take some echo measurements and say, 'Hey, this patient has severe aortic stenosis, and that drives treatment,' that simplifies the diagnosis dramatically. It would make a big difference. We think that's important.

Sure. When you look at the average U.S. volumes in U.S. TAVR centers today, is there a number for average utilization in terms of monthly surgical volumes? When you think of fewer hospital end days, how significant of a driver could that be to average utilization, that average utilization number?

We've seen new hospitals come into the system, and that's been good for growth. We feel like hospitals have the ability to add capacity if that's really underlying your question. They do that quite well. They can do it by adding days. They can do it by adding clinicians. We have found them routinely able to do it not to be a big burden to them. It is clearly helpful when length of stay is shorter, but some of it is their own practices. If they're able to do, for example, multiple TAVRs in a day, that really helps.

Our next question comes from Adam Maeder with Piper Sandler.

Maybe just sticking with the capacity theme. I wanted to ask about new U.S. TAVR centers and kind of where we are today. I think there was a lot of optimism in 2019 with the new NCD that would span a couple of hundred new TAVR centers. COVID-19 has obviously been impactful. But just wondering if we're starting to see some green shoots again and new centers open up? Or are we just not quite there yet? And then I have a follow-up.

Yes, Adam. I hope your follow-up is for Scott Ullem. He's getting lonely over here without any questions. But let me get to your question. Yes, we're probably approaching something around 800 centers in the U.S. It's interesting; even during the pandemic, there's been an increase each quarter, maybe 10 to 20 centers per quarter. It's gradually increased. We've been impressed that centers have actually come online during the pandemic, which tells you about their desire to be able to bring the TAVR treatment to these structural heart patients. So we've been doing nicely.

That's really helpful, Mike. And apologies to Scott, but one follow-up on the TAVR side of things in the pipeline. Just—it's been a little bit since we've gotten an update on the SAPIEN X4 program. So just wondering if there's any new developments you can share there? Is that something you still plan? I think you're planning to move that to a pivotal trial at some point in '21. So is that still the case? And just when will we learn more about the feature set and product design?

At this point, Adam, we're not prepared to share more about the feature set of the product line. We are still expecting to begin the clinical trial in 2021. And I think maybe even from a bigger picture perspective, although we're really pleased with where we are on TAVR, we're not going to stop innovating. We continue to find opportunities for us to improve this therapy and make it better for patients, and we're going to stay relentless in that regard.

Our next question comes from Matt Taylor with UBS.

Maybe I'll try to get Scott involved. I guess I'm just wondering, with—with—you had better-than-expected growth across the product lines in Q1, and you basically raised guidance by the beat for the year. But I'm just curious, at least from a high-level standpoint, are you feeling better about the year now that you have one card turned over here, one quarter under the belt? And why not raise guidance more? Is that out of an abundance of caution? Or have things gotten worse to the point where you don't feel comfortable doing that yet?

Well, look, we're pleased with what happened in the first quarter, both in terms of sales and how much of that fell right through to the bottom line. But just to take you back, remember at our investor conference in December, we laid out guidance for all of 2021, assuming three things. That we get through the winter months, that vaccinations get widely administered, and that hospitals remain open. When we got to January, it felt pretty bad. We felt like things probably on the margin gotten worse, not better since our investor conference. Here we are now having seen the results of the first quarter; we're feeling positive and confident about the guidance that we laid out originally in December. We think it's going to be choppy. It has been choppy in the first quarter, although there are certainly signs of strength, and it's the reason why we still feel confident in the guidance that we've laid out for the second quarter and reiterating the guidance for the full year.

Our next question comes from Pito Chickering with Deutsche Bank.

One for Mike, one for Scott. First one for Mike. As the world begins to recover post-COVID, I'm curious if you're seeing any changes with any referral channels you talked about. Are smaller centers outperforming larger centers? Have you seen local docs help drive increased diagnosis of patients within their markets?

Yes. Pito, I think it's not fair to say that we've seen meaningful changes in the referral channels. We have seen, anecdotally, that patients may be less likely to travel long distances to a center of excellence, and they're more likely to want to stay local to their centers. That's probably been in there to some extent, driven some of the behavior during the pandemic.

Okay. Fair enough. And then for Scott, I get the cost will increase as travel and conferences begin to pick up again as revenues begin to recover here. But if you can quantify how much travel conferences will generally impact expenses throughout the year?

Yes. We're not going to break down travel versus the other expenses, but now there are a couple of different drivers of our expectation that expenses increase. One is just actual travel and people out in the field; two is more training, more time going in person to society meetings to the extent that those start coming more in person. Along with clinical trials, we're expecting that clinical trial enrollment will continue to increase. That's a number that shows up in our research and development expense line item. Those are at least some of the pieces impacting our overall expense ramp in the rest of 2021.

Our next question comes from Jayson Bedford with Raymond James.

No one's asked about the strength in Surgical. I realize there's a comp dynamic, but I can't remember the last time Surgical grew faster than TAVR. So just a couple of questions on that. Can we assume most of the strength was from international markets? Were there any stocking orders that impacted growth? You also mentioned growth was helped by premium products. Any way to parse out procedure growth versus dollar growth?

Yes. A few things—you're right. Surgical rates dropped precipitously in late March, so some of that is a comparable and should therefore be taken into account. But actually, the U.S. was quite strong. It certainly matched or slightly exceeded global rates. It was broad globally, but the U.S. was good. I don't know if that ended up answering your question.

Thank you. That's all the time we have for questions today. I will turn the floor back to management for closing remarks.

Okay. Well, thanks all very much for your continued interest in Edwards. Scott, Mark, and I welcome any additional questions by telephone. Back to you, Mark.

Thank you. This concludes today's conference. And just a reminder, to access a replay of this call, you can dial (877) 660-6853 or (201) 612-7415. Once again, the number is (877) 660-6853 and use conference ID 13717235, once again, conference ID 13717235. This concludes today's conference, and you may disconnect your lines at this time. Thank you all for your participation.