Silk Road Medical, Inc (NASDAQ:SILK) Q2 2023 Earnings Call Transcript

Lucas Buchanan: Yes. The potential is in that range, Chris but we launched this product in Q2 and we’ve taken a premium pricing strategy. So where we sit today is this product is in the minority of our accounts that is being used in the minority of our procedures and we’re doing the work to get the product through VAC committees and start to get a trial in each account. So we’ve got a lot of work to do to fully penetrate that product into our account and physician base like we have with the 4 other products. Certainly, each quarter that goes by those — that penetration and utilization will go up. But that product and our expectations for its contribution to our revenue and kind of our revenue per procedure metric is obviously within our updated guidance.

Operator: And our next question comes from Rick Wise of Stifel.

Rick Wise: Let me start off with guidance just from several angles. You — obviously, as you both said had a superb quarter excellent in so many ways. And you raised by the amount of the beat, could you talk about guidance for the second half? I mean I sort of reflect you’ve trained more doctors, your — the 3 new products you talked about a present and positively affecting the whole process. The sales force has been expanded. The territories increased. Why wouldn’t we see sort of more dramatic sequential improvement and impact from all these positive factors, I guess.

Lucas Buchanan: Sure, Rick. I’m happy to take that. Obviously, we’ve essentially cut our range in half here halfway through the year. We touched on the seasonality and which usually takes the form of vacations in Q3. We’ve essentially signaled obviously increased confidence in our overall procedure number for the year and a slight tightening on revenue per procedure. And as you mentioned, raised by the size of the beat. And so we feel confident about all those pieces of the puzzle you mentioned to continue driving this business.

Rick Wise: Last year, we saw a bigger sequential step-up 3Q versus 2Q and the same seasonality. Why wouldn’t we see that same sequential uplift this year?

Lucas Buchanan: Yes. I think each year is a different set of puts and takes. Again, I think we will see a sequential step-up in procedure volume and we’re shifting slightly conservative on the kind of inventory in the channel which is really revenue per procedure and we’ll push the business as we always do to overachieve.

Rick Wise: Sounds good to me. And just on your comment about the new family of tapered stents. It seems exciting. Our physician conversations over the years have suggested that there are maybe 15%, 20% depending on the doctor you speak to of patients who are viewed as not optimal candidates for one reason or another for TCAR, something about their anatomy, et cetera. Does this expand the use of TCAR into maybe populations that have not been sort of available for TCAR in some way? What impact does this have on growth, procedure, penetration, ASP? Help us think through the implication of these new products?

Erica Rogers: Rick, I’ll take that one which is this ENROUTE tapered stent configuration is really in response to listening to our customers and what they want and need to continue to drive adoption, their adoption of TCAR. And this really comes out of just some very specific patient anatomies and configurations of lesions and things like that where a tapered configuration is more suitable for the job. And we’ll get into more of that detail, I think, when we’re launching the product. I’ll spare you the gory details for the moment. But in general, the way to think about it is this just increases the satisfaction of physicians around TCAR and in so doing absolutely drives physicians up the adoption curve.