CEO Olivier Taelman is gonna walk us through a little bit of a presentation, and then I have enough questions for some fireside Q&A. But if anybody in the audience wants to ask a question as well, we can make time for that, too. So then I'll pass it off to you.
Thank you. First of all, I would like to thank Bert for having us at this conference. Now, when it comes to the presentation, I would like to start with a general overview. Nyxoah, a company active in obstructive sleep apnea about offering a solution through neuromodulation and stimulating the hypoglossal nerve. If you look at our blueprint, what we call the blueprint for success, and why we believe we will be successful going forward, is the fact that first, when you look at the obstructive sleep apnea market, it is a huge market. It is under-penetrated. I think you all know someone who is having a CPAP mask. That is still the gold standard. But then there is also other solutions, like hypoglossal nerve stimulation, when we are focused on patients that are suffering from moderate and severe obstructive sleep apnea.
Next, when you look at the technology, our technology is called Genio. It's innovative, it's disruptive, and it's definitely a breakthrough. I will come back to this on the next slide. In Europe, we started generating our first revenue since two years ago, so also there, we are further expanding the market. Today, we are mainly active in Germany. Tomorrow or later this year, we also manage to open up the U.K. market, and we have some smaller countries, like Switzerland, like Austria, and also Belgium and the Netherlands, where we have submitted also reimbursement files. And then last, of course, when you have active or when you have activity in the MedTech space, everything starts by having a pivotal study.
There, we are extremely excited that in March of this year, we were able to show that we reached our primary endpoints on both efficacy and safety in our pivotal study. That was called the DREAM Study. I will skip this one. I think most of you are aware when I say it's a huge market. If we would be a pharma company, we would be talking about blockbuster potential with more than 500,000 patients that are eligible for treatment in the U.S., of which currently roughly 30,000 are receiving treatment on annual basis. If you look a little bit more on the Genio technology, and I think that's very interesting. So for those who are not so familiar with obstructive sleep apnea, in fact, what happens is when you sleep, you will get a collapse of your upper airway.
When it's completely closed, it's called an apnea. When it's partially closed, it's called a hypopnea. Why are people in need for treatment when you suffer from OSA? It's very simple. It's because your risk for stroke doubles, and your cardiovascular risk is going up by five. That's why people deserve and are in need for treatment. You will see also, when you met someone or you meet someone who is suffering from moderate or severe OSA, we are talking about severe OSA, 129 obstructions every hour when you sleep. The result is when you wake up, you not feel well-rested. You feel like hit by a truck. Most of the people cannot concentrate for long. Some are even not able to go to work or to really enjoy life, with also in combination with the risk of the increased mortality. That's why they need treatment.
Other people will say: Will this also help getting rid of the snoring? Because, yes, also, people who suffer from obstructive sleep apnea, they will snore. It's not because you are snoring that you suffer from obstructive sleep apnea, so you don't need to get worried when you have a night with maybe a heavy meal and some alcohol, and you're sleeping on your back, and you make a lot of noise, that you have obstructive sleep apnea. It's not always the case. Now, how are we offering a solution? Very, very straightforward. When the upper airway is collapsing, you need to maintain the airway open. This nerve, it will provoke a muscle contraction of the genioglossus muscle. You know this muscle under a different name. It's the muscle, it's your tongue that is connected in the back of your throat with your upper airway.
So when you sleep, we stimulate the nerve, the muscle contracts, and you get an anterior movement of your upper airway, and it maintains open. I think that's very important. It's a straightforward mechanism of action. There is currently one U.S. company, Inspire Medical, that initiated and introduced, in fact, hypoglossal nerve stim with a lot of success into the market already several years ago. Their mechanism of action is comparable. So also there, you stimulate the nerve, you provoke a muscle contraction, and you maintain the airway open. What makes us so special? If you look at the technology, we have an implantable component, so only one implantable component. It's a bilateral stimulation. Why is bilateral stimulation so important? Because it, in fact, enables the physician, when they implant the stimulator, to have a contact with the left and the right branch of the hypoglossal nerve.
What is the result of this? That when you have a collapse, whether it occurs left or right, or both lateral walls, or even a complete concentric collapse, with a bilateral stimulation, we show data that we maintain the airway open. With unilateral stimulation, they don't. So they are even contraindicated when it comes to a complete concentric wall collapse. I think that is one key differentiator. Next is there is no implantable battery, so we do not have a pacemaker platform. The energy that we get is coming from a wearable component that goes under the chin, an external component when you sleep, when the person or the patient is going to bed, and through induction, there will be an energy transfer and activating, in fact, the implantable component. So no battery. What is the benefit, having no battery in your body?
First of all, you don't need to replace a battery when it depletes, so no need for re-surgery. But I think also very important, when you have to undergo an MRI scan, and we know that the average age of an OSA patient is roughly 52, 53 years, there is a high risk that at a certain moment for something else, you need to undergo an MRI. We have a full body compatibility. It's completely safe because there is no pulse generator that is implanted. Last difference is also the fact we don't have this electrical wire or the lead that needs to leave the pacemaker and going into the nerve. We don't have this. As we also saw in literature, when you have a lead, leads, they tend to break over time or to dislocate. That's how we are different: bilateral, no battery, no leads.
I think last, also, when we would like to send an upgrade, also there is no need for re-surgery. We just simply need the patient to connect the activation chip with the computer. Physician does the same thing, and we can push it through a little bit like you receive with your iPhone if you have a software upgrade. So you will always have access to the latest and greatest technology upgrades. Pivotal study, I was mentioning it. You need clinical data. In the U.S., we did a study. It's called DREAM study. We implanted 115 patients. From an efficacy perspective, we had a primary endpoint looking how will be the reduction in events in AHI. And next, there was also a co-primary endpoint looking at the oxygen desaturation. So how is this going down?
From a safety perspective, it is as normal with med tech, severe adverse events. What we also can say is that all the events were adjudicated by an independent clinical events committee. Now, the mean baseline in AHI, all our patients, they had minimum 28, 28 events per hour, so close to being severe OSA patients. Their BMI was also close to 29, so 28.8. That means that they were also obese, because you start becoming obese once you pass, in fact, the 27 in BMI. We had heavy patients with also a significant OSA impact. What we are seeing is that from an AHI response rate, so apnea-hypopnea index, we were able to reduce the number of events with 63.5%. Now, what is this number meaning?
If you put it a little bit in perspective, it's comparable to what competition has shown. Where is the difference? That when we are having our patients measured and qualifying as responders, that they were not only sleeping on their side, they were also sleeping in what's called a supine position or on their back, like all of us are doing. If tonight you go to bed and you would measure how much time did you spend in a supine sleep position, it would be roughly 35%-40% of the night. In the initial study with competition, there was no need to measure this. I think FDA learned, I think also the sleep community learned, and in order to have a really effective technology, they added the fact that we also should be capable in maintaining the airway open in a supine position, which we did.
That's what we are seeing, that is what we showed. Oxygen desaturation, we had a 71% response rate. If we look at the median AHI reduction after 12 months, and I think that's also important, you see that it stays above 70%. The conclusion is, we met our primary endpoints, and we could enter now the next phase in the U.S. commercialization or the way to the U.S. commercialization, and that would be also FDA approval. There we are talking about. I'm going faster. There we are talking about a modular PMA. We had to submit four modules. All modules are submitted June this year. The first three modules, we already answered all the questions. The last module, it's more about labeling, manufacturing, visiting clinical sites.
And there I can tell you and share the good news with all of you, that we finished the site visits without any deficiencies, and also the first manufacturing site in the U.S. just was terminated, and also there, no further questions or deficiencies. Next step will be Belgium manufacturing site, clinical database, and we still expect to have FDA approval before the year is ending. So within, let's say, two, three months from now, we should be able to have FDA approval. And that brings us to the exciting time, that U.S. commercialization. So on this one, a couple of things. So first of all, we have the entire U.S. commercial leadership in place, starting with our Chief Commercial Officer, standing in the back of the room.
Comes with a world of experience in med tech, over 25 years, and launching and introducing quite some other technologies in a successful way. Next to him, we of course have our marketing person, we have the market access person, we have our VP of sales, we have our sales directors. The only thing that we still need to hire are the sales reps. Intentionally, we waited a little bit just to make sure that when we hire, we can train, and we can get everyone ready by the end of this year, and that is what we know that will happen. I personally was a little bit overwhelmed with the attention we received when we announced that we are preparing our commercialization. We got more than 400 people applying for a job in our commercial team, from Inspire, from other neuromodulation companies.
So I do think that, when asking them, "How did you get in contact with Nyxoah?" It mainly was our physician saying that there is something new coming that will really make a difference and that will break a monopoly. So that is, I think, also a very good sign. Now, how will we launch? We will not go like crazy guys after every single implant account. If you look at the OSA market in the U.S. and the hypoglossal nerve stimulation market, more precise, there are roughly 1,400 implant sites spread over the U.S. Still a very concentrated business, meaning that between 300-400 of the 1,400 sites are generating more than 85% of all implanted patients in the U.S.
So we did our homework, we start segmenting, and then we will also, in the first phase, like day one after FDA approval, we will have our teams reaching out to well-targeted sites. Now, how do we wanna de-risk this commercialization? We did a commercial proof of concept in Germany. Why Germany? Simple reason: it's the largest market outside of the U.S. for our competitor. It's the market where they have the monopoly, and it's also a market where they have a full reimbursement in place. Now, what did we wanna prove? First, that when we are coming into the market, that the physicians and patients are accepting our technology. Second, we wanna prove also that we can obtain comparable reimbursement, and in going forward, we also wanted to prove that by having multiple players, you see this as positive in market and accelerating therapy penetration.
Some numbers in Germany. It's a small market, EUR 16 million in total. There are roughly 67-68 implanting hospitals or accounts that were doing competition. After 24 months, we are in 63 implanting accounts. If you look at the top 10, the high volume accounts, it's still also a very concentrated business. We are in 9 out of 10, and if you look at those nine, in 4 out of the 9, we are market leader. So I think that answers the question, are physicians and patients embracing your technology? I think we can say yes. Reimbursement-wise, we have similar reimbursement obtained, same coding, same patient phenotyping, same physician fee, same hospital fee, so that's also going well. We also saw that therapy penetration since we entered. There was a normal market growth of roughly 10%-12%.
Since we have entered, it has grown from 12% - 30%. So these are key learnings that will help us also entering the U.S. market. There are, of course, also differences. For example, I think the key difference is your direct access to patients that you have in the U.S., where in Europe it is much more restrictive. So just to paint the picture a little bit. And then the last slide: what can you expect? I think I covered everything. DREAM data we had in March this year. The clinical PMA submission was done in June, so we expect approval by the end of this year. The commercial team build-out, we hired the entire sales leadership, and now we will go into hiring the sales reps.
We prepare a potential launch, and we will be ready in the U.S. by the end of this year to do this, and then there is the label expansion that we already obtained in Europe, being able to treat patients suffering from a complete concentric collapse, where competition is contraindicated. We're already doing this in Europe, and we have a separate study in the U.S. that is also studying those patients to further expand our label. That's it. I'm excited. I hope I was able to provide you with a little bit more clarity on where we stand and why we believe we will be successful, and we are really looking forward in embracing the future. Bye. That starts, in fact, that's as of tomorrow.
Sorry, what is as of tomorrow?
Our future in the U.S.
Oh, at least-
We're preparing the U.S. commercialization.
At least that's tomorrow. All right. Okay, so again, feel free to jump in. I've got a couple to go off of, but I wanted to start first just on you know, how you're thinking about the U.S. market opportunity. So I think you said there's 200 - 300 sleep centers in the U.S. Is that the right number, 200 - 300, or is it?
It's more 300-400.
300-400. Okay.
Yes.
So 300-400 centers doing 85% of the implants in the U.S. I think on the last call, you talked about, you know, somewhere in the, I don't know, 60 - 80 centers you're kind of initially going after, which obviously are a part of that, you know, 300-400 centers. So, how are you kind of targeting the year one, so that 60 to 70 to 80, you know, the year two, year three? How do we think about the new accounts that are getting activated over this period? Or are you kind of thinking about, let's do 60 - 70, and we'll keep it there, and then in 2026, kind of move beyond?
So, more or less asking about how you're focusing on opening new accounts, and then how you're thinking of expanding to new accounts and driving utilization at the same time?
Yeah. No, no, then it's an excellent question. So first of all, what we are learning is through the DREAM study, we were already interacting with more than 20 accounts in the U.S. We recently also have a usability study that was a requirement from FDA, that was focused on non-DREAM study sites, bringing in physicians and surgeons, making sure they got a training, theoretically, animal model, cadaver model, and within 24 hours, they had to reproduce an implant independently. So also there, the feedback was really, really positive in the sense that all 31 sites that are high-volume Inspire sites, they wanted to have access to our technology. So to answer your question, all of this usability study, in combination with what we learned in DREAM, we already have roughly 50 sites that would qualify to work with us.
The others, of course, we are interacting with them. We are also learning and observing and are preparing also our strategy where we can have the highest impact. Now, the next question is: how will you do this? We would like to start with a scalable launch, meaning that I'm not waiting one year to add sites. We will add sites every quarter, and along with adding new sites, there will also be an addition of new salespeople. So let's assume that we will start with 75-100 implant accounts that are well targeted. We will have a sales team in the field of roughly 25-30 people, supported by another 20 people that will help streamline, for example, pre-authorization files, work with purchase departments, making sure that we take a lot of administrative burden out of the hands of the hospitals.
So in total, we are talking about a 50, 50 people commercial team in the U.S. to get started with, and every quarter we will be adding sites and also adding new people.
For the initial 75 - 100 accounts that you're going after, what do you think is a reasonable, you know, number of implants per center, per month, per quarter, however you wanna kind of frame that up?
Yeah, and then, and this is a very tricky question that also we are making our internal models, but unfortunately, I don't think it would be wise to provide any guidance at this moment because there are so many unknowns on this. I just can come back to what we learned in Germany. So there we started, and we saw that we were able to capture 25% market share in 24 months after launch. I'm not saying that we are reproducing this, but I'm just trying to answer and give you some facts. But when it comes to the U.S., I think at this moment, we are not providing guidance, and it would be unwise to make any comments.
Okay. For the 3 - 400 centers that are doing 85% of the volumes, I mean, what do you think is a reasonable framework to think about when you would, you know, hit the 300 mark? Is it you do 75- 100 in 2025, then you can double that, so by 2026, you're at the low end of that 3- 400 , or is it more of a gradual pace of new center adds, where maybe 2026, 2027 is when-
Mm-hmm.
You're kind of in the time. Or sorry, 27, 28 is when you're in the time frame of that 3- 400 , kind of-
Yeah
... 85% of volumes?
So once again, I do not wanna make it a real, number game at this moment because there are a lot of unknowns, and I wanna set correct expectations, so that is one thing. What I do think is important is that you increase therapy penetration in accounts that are implanting. For example, today, 1,400 implanting accounts, 30,000 patients will be implanted in 2024 with competition. That is on average, less than five implants. I don't think that this is the best way forward. You cannot endlessly continue opening new accounts. At a certain moment, you will need to increase the number of implants.
So in our strategy, we will focus on what I say, going more deep from driving new patients and having implants done on a weekly basis, or multiple implants during one week, than in expanding and to have a lot of accounts doing maybe one implant every month or every two months. Because if you wanna have a clear quality implant, you also... the surgeon needs to do this in a repetitive way, and not every month or every two months doing one implant.
Mm-hmm. You talked about 400 applications for, I'm assuming, sales rep positions.
Yes.
25-30 maybe is where you're kind of starting out at in the U.S. I guess, one, have you made any hires in the sales rep front? And two, when should we expect that 25-30 sales reps to be I mean, is it December, by the end of the year, that we're gonna have the full sales force on board? How long does training kinda take?
Yes.
How are you thinking about us starting to see those people?
Mm-hmm
... coming online?
We have a really in-depth training program that we wanna push all our salespeople through, because we wanna have high-quality people out there interacting with physicians. We know that from day one till reps being certified, it takes roughly four- six weeks. Our plan is straightforward. By the end of October, we wanna have everyone on board so that we have everyone trained before Christmas and ready to be operational.
Okay. Okay, on the clinical data front, right? You had results from the DREAM earlier this year. You know, primary effectiveness endpoint, similarly in line to what we've seen with other competitors out there. You talked a little bit about the supine labeling potential claim. There were some SAEs that you talked about a little bit that were in there. So, my first question is, you know, what I guess was the kind of immediate reaction from the physician community? I know at the ISSS conference at the end of September, you're gonna have a presentation there.
So can you help us think about what the physicians are seeing, thinking, potentially could think, based on what the data is, right now so far?
Yeah. So I think first, all physicians were really cheering the fact that we are coming with clinical data, that there is a second player in this field with a pivotal study that is terminated, and where they can see what are response rates, what are the severe adverse events, and what about safety. So that's the overall feeling. Second feeling was also: How is bilateral stimulation compared to unilateral stimulation? Do you see this reflected in the data? And if you look at it with a really conservative lens, you would say, at first glance, "No," because you see comparable data. You have the same patient phenotyping, you have the same BMI limitation. But then, if you start digging, and that's where the supine aspect comes, it's clearly yes.
By adding this supine component, having people sleeping one hour, two hours, three hours on their back and still maintaining the airway open, this can be seen as superiority to what was published before with unilateral stimulation, where they never reported on supine sleep time.
... And from the physician perspective, maybe even the patient perspective, right? What level of interest is there in the supine labeling, and as it relates to the percentage of patients out there that this could affect, how do you think this is gonna play into the, you know, interest among the physician community?
So when we do our market research and what we are hearing in interacting with physicians, it's very simple. You wanna do something that mimics a natural way of sleep. So you do not wanna tell a patient, "Try to sleep on your side. Try not to sleep on your back." You just wanna say, "We will give you a solution that will help you reducing your obstructive sleep apnea and give your life back, and you just act like any other normal human being when they are sleeping." That is really impactful also in the selection and the acceptance for patients of a technology. Because let's not forget, you are talking about a surgery. In the past, a pacemaker that is implanted, today, with Genio, there we already differentiate.
And then on top, you can also say, "You don't need to worry how you sleep, in what position. Just go to bed and sleep like you're used to." And I think this will be really a convincing argument in the selection and the acceptance for patients for the technology.
Based on your conversations with physicians, is the supine versus non-supine concern pretty strong in the community, that this type of label, you know, would be something that physicians and patients wanna see?
Yes. The short answer is yes. If you can have a product that is labeled, showing the same or comparable reduction, supine and non-supine, this is definitely making a huge difference.
I think we're gonna see the data at the end of the month, presentation, right? Of the-
Yeah
... of the CN already. What do you think we should be looking for, at least from, you know, the reactions from physicians there? How are you kind of going into that conference with maybe some marketing material even-
Mm-hmm
... to be able to have the first opportunity to capture physicians there? Obviously, you're not gonna have a sales force at that time that would be available to be at the conference, but, you know, what kind of momentum are you anticipating, you know, coming out of that presentation, ahead of what would be the approval and launch?
Yeah. So first of all, we need to be very prudent that we don't start promoting actively our device as long as we don't have FDA approval. I think that goes without saying. But the key takeaway from us is that finally we can share strong data with the physician community, with the surgeon community, but also with the sleep physician community. That's one thing. I'm sure that this will add to building more confidence around hypoglossal nerve and around the Genio technology. That's the first thing. And second, I do think it is important to further educate also surgeons and also sleep physicians in what the effect can be for patients. And then I'm coming back to this supine, non-supine, higher BMIs, higher intensity level of obstructive sleep apnea.
Reimbursement, you know, will be coming up for the device. Obviously, you have to get your own kind of code there. Can you remind us of the timeline of what that looks like? I know you've talked about how you expect it to be essentially in line with what the market has out there, but when you think about going from what would be essentially a temporary code to a permanent one, longer term, you know, components of reimbursement is the procedure time and the device cost itself.
Mm-hmm.
And if you have a lower amount of device in the patient and a faster procedure time, that theoretically could argue that reimbursement should be different than what there is out there in the market. So help us think about the timeline for what you expect to go to market and then 2025, 2026-
Yes
... 27 of permanent codes.
From a pricing perspective, we will align on price, and we will differentiate through our technology. From a coding perspective, we are actively working with the American Association of [Otolaryngologists]. That will make a recommendation to AMA, so that is actively going on as we speak, and there are a couple of scenarios and a couple of codes that have been clearly pushed forward and will be identified. On the other hand, we are no different than another med tech company. We will need to wait till FDA approval before we will obtain a code. We will work with pre-authorization the moment we have FDA approval, and of course, in parallel, we will also apply for our own dedicated code, the MS-DRG, and the new technology add-on.
So do you believe that by January 1st of 2025 , there would be a code... or the time at which you receive approval, that there will be a code in place for you to get reimbursed under?
Let me answer it differently. By the time we get approved, we will submit our pre-authorizations, and we do think there will be payment for our technology.
Okay. Maybe the last one, 'cause I know we're almost out of time here. The partnership with ResMed in Europe or in Germany, you know, has raised questions as to if that, you know, could be an option or a pathway to go to the market.
Mm
... in the U.S. Maybe a year or so ago, this was announced, so I'm curious on how your view on that opportunity has evolved, if at all, and what we should be thinking about from a, you know, broader portfolio offering perspective.
Yeah, and I see your time just-
We can go over by a bit.
Okay. No, then, let me be really clear on this one. We know that up to 50% of people are quitting CPAP or the use of their mask within a timeframe of two years. If you just look in the U.S., you have, every year, almost 2 million patients that are started with CPAP. It's almost 500,000 that is not only quitting, but also eligible for hypoglossal nerve stim, and roughly 30,000-35,000 are captured. So there is a huge opportunity. Through a collaboration with them, if we could further streamline the pathway and making sure that patients in need for therapy do not get lost for therapy, I do think that that will give us and put us in a very strong position.
I think it also will help the healthcare system in reducing cost, because untreated OSA is extremely expensive, and I think from a patient perspective, of course, the benefit is obvious. So that's what we will be exploring further.
Okay. I think that's it for time. Thank you.
Thank you.