All right, we're going to get going here. Welcome to the afternoon session at the 2025 Piper Sandler Healthcare Conference. My name is Adam Maeder I'm one of the med tech analysts here at Piper. I'm very pleased to introduce the management team from Nyxoah. With us, we have Olivier Taelman, CEO, and John Landry, CFO. Gentlemen, great to see you.
Thank you, Adam. And it's always a pleasure for me to be here because it was exactly the first congress I ever presented as CEO almost seven years ago.
Wow.
Thank you.
Fantastic. Coming full circle. So a lot to discuss here. I think five topics to work through: status of U.S. launch, Q2 ramp, reimbursement updates, pipeline, and then maybe P&L. So we'll see if we can kind of get through most of those topics. But, let's start with U.S. launch. So, Olivier, on the Q3 earnings call, you said you had done 15 U.S. implants across nine accounts through the end of October. We're now in early December. You know, just wanted to give you the opportunity to chime in on the progress you've been making over the last several weeks.
Yeah. So first of all, it's the most exciting time for the company. We got our FDA approval on August 8th. I will never forget the Friday. As of August 11th, we started actively launching. You know that in our launch, we focused on the high-volume hypoglossal nerve stimulation accounts. So we have a very focused launch with our commercial team. We are covering, at this moment, more or less 125 out of those 400 high-volume accounts that then are covering almost 75% of all revenue, of all volume in the U.S. So we started with the first time showing success in the sense that you have to train surgeons, then you have to go through the VAC committees, then you do a pre-authorization submission, you get an approval, and then you do an implant.
So for us, it was great to see that in less than five weeks post-approval, we were already doing the first implants. Now we are entering December. Of course, we made steady progress. I will not comment in detail on the numbers of implants that we have done. I want to keep this for Q4 because the earnings call will be coming very quick. But I can comment, if you want, a little bit more on other leading indicators like number of surgeons trained. 125 targeted sites. Today, we have 128 surgeons trained.
Okay.
The next thing is VAC committees. As you know, some are meeting on a weekly basis, monthly basis, quarterly basis, so we already have done 108 submissions, and out of the 108 submissions, roughly half have been approved, but I think more important, we are still at a 100% approval rate, so it's more a timing question than it is of having non-approval, so that is, I think, very positive, and then I think the question that investors had while we were going through FDA was, will you be able to have reimbursement from the get-go? I think today we can say we have totally de-risked this in the sense that we have a 100% approval on all pre-authorizations we have done. We have approvals from private payers like UnitedHealthcare, Blue Cross Blue Shield, Anthem, Aetna, so just to name a few.
Of course, there is also CMS that is also paying for our technology. So it's going extremely well. We keep continuing to train surgeons. We already scaled up our sales force. We actually hired another 15 territory managers, which will result in another 75 accounts. So the 125 will become 200 going forward. So a lot of excitement.
Fantastic. A lot to unpack there, but really appreciate all the leading indicators. So, you know, maybe just to kind of regurgitate it back to you. So I think you said 108 PMA submissions.
Yeah.
You're through roughly 50%. Those have been accepted.
That is correct.
Okay. Fantastic, and you're still seeing 100% prior auth acceptance rate.
Correct. Yes.
Okay. Fantastic. And then maybe just the last point you mentioned from a sales force standpoint, I just want to make sure I heard that correctly. You've added another 15 heads.
Actively. So the offers are out. People will be onboarded during the month of December, and we will start training them in the first week of January. So they will be fully operational normally as of, let's say, end of Q1, entering Q2. They will be fully operational.
Just level set us how many salespeople you have right now, and the extra 15 brings you to what level?
Mm-hmm. So we have 25 territory managers. They all have five of those high-volume accounts. That makes 125. So adding 15 means bringing another 75 high-volume implant accounts on board. But in total, our commercial organization, we have today 50 people because next to the territory managers, we also have market access people that are helping with VAC committee, with helping with pre-authorization. We have field engineers that are helping also when we are doing the first implants to guarantee a good quality level. And then there is, of course, some management, marketing-wise, sales leadership, etc. I'm sorry for my voice, but it has been a long day.
Perfect. It makes sense. So 25 territory managers today going to 40 soon in early 2026.
Correct.
Perfect. Okay. Fantastic. You know, I feel obligated to ask a question about FY26 and the top line. You know, John, you can take this however you'd like, but I have the street modeling FY26 revenue of EUR 28-EUR 29 million. You know, any reaction to that figure? If not, just any puts and takes you'd like to provide, investors at this juncture.
Sure. Yeah. No, thank you, Adam, for the question. So this quarter, fourth quarter of this year is the first quarter we've provided guidance as an organization. So our guidance for this quarter is EUR 3.4 million-EUR 3.6 million, three and a half to midpoint. We haven't provided guidance for fiscal year 2026 at this point. We will earlier in the year of 2026. So I just think for some context around the EUR 28 million-EUR 29 million number, if you take a look at what we expect the HGNS market to be in 2026, it's roughly $1 billion in the U.S. That would equate to roughly about a 3% market share. So I think, you know, this quarter, as we make progress in the fourth quarter, will be very informative in how we think about 2026 going forward.
So we feel, you know, well-positioned based upon our progress to date. Some of those key metrics that Olivier shared with us here earlier, with regard to our fourth quarter performance.
You know, I don't like the 3% too much, as you can imagine, but I also would like to give some more color in the sense that when you do a focused launch, we are not having the sales force that can reach out to all 400. Let's not even talk about all 1,500 accounts that are currently doing HGNS. Just in the ones that we are focused on, we will be talking about market share positions of 15%, 20%, 25%. So showing good traction. And I was recently, yesterday, day before yesterday, I'm traveling like crazy, yeah, to see physicians to get their experience, etc. And one of the questions that I'm constantly asking as well is, how do you see this integration in your daily practice over time?
What I'm consistently hearing back is that they are saying, we see this becoming a 50-50% market split in our practice. Some are even saying, if everything goes well with your bilateral stimulation, you know, like and meet all the expectations, it can even become a Genio market or a Genio hospital. But what I've never heard, and I think that is the most important thing, is that people are saying, we will limit this to one or two occasional patients. Because when you embrace a new technology, it's important that you do this. It's also your nursing staff, for example, that need to follow up patients, and they would never go to the burden in saying, we do something new to do it maybe 10 times a year, especially not in those high-volume accounts. That is really reassuring also hearing this. So will it be 50-50?
Will it be 20%, 30%? We will see. But it will definitely not be 3%.
Fantastic context from both of you. Thank you. You know, maybe a place to follow up would be on outcomes, and you know, we obviously have the results from the DREAM trial. You know, Olivier, any comments you want to make on kind of how the patient outcomes are looking in the early commercial cases in the U.S.? Are you pleased with what you're seeing there? You know, and then one question that I have personally is, will you do some sort of registry to kind of collect additional post-market data?
Yes. So the first aspect what you see when you implant is during implant, how is the airway opening? You know, what are the results? And there, surgeon feedback is extremely positive. They're saying we see airways opening up. We are also seeing that we are able to maintain this, whatever position a patient is in, also in a supine position. And they really are endorsing, liking the aspect of bilateral stimulation. So once the patient is implanted, as you know, we wait roughly six weeks before you activate. Sometimes it's after five weeks. But the first actual patients were activated this week in the U.S. And there it's always a little bit, you know, like saying, how will they be doing? Will they show the same result as during the surgery? And so far, the answer is definitely yes.
So that is really reassuring surgeons, and it's also motivating them to continue implanting patients. So that is one aspect. Another question that you had is, will you do a registry? We are obliged, as a post-PMA study, to follow up patients. We are doing this. And going forward, we also will continue following up our patients because data are important. It gives us feedback in how to even potentially get better. It gives us feedback on what is the correct patient phenotype that we are seeing. And it will also give us feedback and helping us also to develop health economic data in going forward. So the answer to this one is also yes.
Fantastic. Very helpful. Just want to be cognizant of time. We'd like to move on to reimbursement, which has been very topical for the HGNS space. You know, for the audience, we had a big reimbursement change that goes into effect January 1, 2026 for CPT code 64568. We're seeing reimbursement on the facility fee increasing 40%-50%, depending on site of care. Effectively, the code is getting moved to NTAP. I'm going to leave it fairly open-ended. Olivier, how do you think about any potential impact to your business and I guess the broader HGNS market?
Yes. So first of all, I'm always being very transparent in my feedback. I think credit goes; it came as a pleasant surprise. Yes. It came as a pleasant surprise. And I think credit goes to the historical users of the CPT code 64568 being vagus nerve stimulation. Now, that being said, today, we as HGNS, we are benefiting from this. And that is positive in the sense that it will motivate hospitals even more to do HGNS. In our specific case, we are going to VAC committee approvals. This is definitely a strong argument that resonates well with hospitals. And last, I also think it will help increase over time also making time to do more implants than currently is happening. So it's a positive effect. Now, how will it impact us? We are the new entry company, the new entering company.
So we will be observing, like, what shall we do? We understand the macroeconomics behind. We know that there is a need to sustain this also in a cost increase, but we will play the observing role, and we will not deviate from our focus. And that is creating adoption therapy increase through a launch in our focused accounts. So that's how we see this. So very positive, pleasant surprise, and let's see how this will evolve further.
Okay. Fantastic. I have to ask some follow-ups here. So, you know, on the VAC process, it sounds like it's been a tailwind. You think it's going to help you getting through more VACs more quickly?
So yes, definitely yes. Maybe on the other hand, also something very important for the ASCs. So we know when we have our technology that the Genio technology is the most fitted technology to be implanted in an ASC because we have a single incision. It's minimally invasive. So also through this reimbursement, a tailwind, it's also clear that the ASCs will become even more important. And we are already focusing also more on these as well because our technology is at this moment the best-positioned technology to be implanted in an ASC.
Very helpful color on the ASC front. And pricing, I just want to make sure I understand the pricing strategy, and how we should think about pricing models. And I think right now you're pricing more or less at parity to the competitor, you know, given the reimbursement change, will you look to increase your price?
No.
Yes. Were you able to make any comment at this point?
I think it's a little bit early on this, but as I was saying in the past, we always say we align on price and we differentiate by technology, and we will also follow this. I understand the macroeconomics. So we will be more in the observing position as the new market entering company.
Okay. Very helpful. And I guess just one more on this topic. Longer-term reimbursement, how do we think about where reimbursement could ultimately shake out? You know, NTAPs are transitory vehicles. I think, you know, technologies are typically mapped to a NTAP for maybe three or four years, something in that zip code. When it's all said and done, when the dust settles longer term, you know, how are you thinking about reimbursement?
I think in HGNS today, you're seeing that the monopoly that was existing, it is broken. It's no longer one company technology. No, we are also present. Maybe in going forward, there will be even more companies that are entering. I do think it will evolve into a specific HGNS code where all the HGNS technology companies will find their position. That's one thing that I think that will be happening. Then in going forward, it will be up to us together with the AAO coming up with recommendations to AMA to get this dedicated code.
That's helpful. About 10 minutes left. Maybe we can move on to the requisite GLP-1 question. You know, I guess you're just starting to launch in the U.S. market, but still wanted to just kind of ask what are you seeing from a GLP-1 standpoint? How are you thinking about the role of GLP-1s and the impact that they could play, I guess, near-term and longer term in the market?
No, it's an excellent question. You know, I will be very consistent in my answer. I will continue saying what we said from day one. GLP-1s, we welcome them because they give us the opportunity to also treat patients in need for treatment based on their OSA being moderate or severe, coming from a BMI perspective where we would never be able to touch on. Very concrete, if you look at the SURMOUNT study, GLP-1s, the average BMI was 37. The average AHI, or the severity of obstructions, was 50, 49, 50. You see the correlation. BMI reduces to 25%. AHI reduces with 40%-60%. We will have new patients that will be eligible for treatment that we would never be able to treat. So for us, it's a positive event, and we have the tailwind. I'm always confused with the wind. The wind from behind to the tailwind.
We keep seeing it like this. If you allow me to elaborate a little bit further, also in the way we want to position and build clinical data, we always set our cutoff at BMI 32, AHI 15 to 65. That's where we know we are able to decrease AHI levels even below 10, bringing patients back to normal cardiovascular risk as before. We have no intention in increasing BMI up to 40 because we think this is honestly the wrong strategy. We have no intention in bringing AHI up to 100, but we do have an intention in expanding, for example, by offering solutions for more complex airway obstructions like CCC, like lateral wall collapse. So that's also a little bit where we are different compared to what is currently existing. I want to highlight this because I think it's so important.
Sure. No, it's actually a perfect segue into my next question, which is, you know, Complete Concentric Collapse or Triple C, and you're running a separate study called ACCESS to evaluate those patients trying to get approval for that indication in the United States. Olivier, just remind us of the timelines there. When could we see data from ACCESS presented? Any thoughts around potential, U.S. commercialization?
Yes. Certainly. So we had to do a 12-month follow-up. We closed the enrollment in June. So 12-month follow-up brings us June 26. Let's say that this will take us roughly 3-4 weeks to analyze the data and to start reporting on this. So it will be August. And then we do a post, not a post, then we do a PMA supplement submission to FDA, and that will take 3-6 months before it will be approved. Now, why am I speaking so confidently on before it will be approved? Because, as you know, we have it already on label, CCC in Europe, based on data that we have developed. And what we are seeing also in daily implants, like in Germany, for example, we see that we are able to show exactly the same results on CCC patients than on non-CCC patients.
That is giving us the confidence that it will be the same, also reaching the primary endpoints in the U.S.
Good color there. So it sounds like data, we could see the data in the back half of 2026.
That is correct. Yes. Yes.
And then approval, you know, maybe first half 2027?
Yeah. I think even Q4, Q1. Yeah. So Q4 2026, Q1 2027.
Fantastic. On a related topic, ansa cervicalis.
Yes.
You know, that's one neural target that you've been exploring through your partnership with Vanderbilt University. Just wondering if there's an update on that program today and just what are the plans to kind of push that program forward?
Yes. So I'm happy that you are bringing this up as well because when we invested in this four years ago, it was like people would say, what are you doing? You're not even FDA approved, and then why are you already thinking about the future? And it all comes back to the fact that we want to treat more patients, patients that are currently not responding to HGNS alone, by adding ansa cervicalis. And I can report back on this one that we made good progress in also looking physiologically, how would it work? Because in our case, you need to synchronize HGNS and ansa. When you start, it's not that simple, but we will do the first in human coming up also within five to six months from now. So we have the technology ready.
We know how we would like to stimulate, how we would like to also synchronize everything, and we expect the first in-human implants to take place within six months from now.
Okay. And just one clarification. So it is, it's going to be dual stimulation modality, ansa cervicalis plus hypoglossal nerve?
Yes. Yes. So I think it's important when you do this that you have this optionality. And then also technology-wise, we will be able also to choose how do we stimulate, where do we stimulate maybe a little bit stronger, where do we do a little bit less? Do we want to do it unilateral, bilateral? But the option is there to have bilateral stimulation for HGNS and for ansa cervicalis.
Great update there. You know, John, I want to jump back to you and maybe just kind of cover the P&L a little bit. So gross margin, I think, has been run-rating in the low 60s this year. Obviously, we're just at the precipice of U.S. launch. How do we think about the impact of gross margin going forward and just any framework you'd like to provide as it relates to FY26?
Sure. Absolutely, Adam. So I think for FY26, really, I'd expect the gross margin to be in the same zip code that we've seen them in the last year or so. We have three major drivers of moving our gross margin from the low 60s to the low 80s. One is our Genio 2.2 activation chip disposable patch. They'll provide us a step function improvement in our gross margin beginning, you know, end of 2026, early 2027, going to enhance the patient experience, but dramatically reduce the cost of both the activation chip as well as the patches. That's one. Number two is, as we drive volume, in particular of our implant, we have different volume-based price breaks in the contract. So as we drive volume, that'll then kick in from a cost reduction perspective. And then the last is just optimizing our overall supply chain channel.
We're still in the very early stages of obviously shipping product here in the U.S. And as we grow that and that matures, that'll help become another lever to drive gross margins up to 80% level. And one benefit we have is that we are producing in the U.S., the contract manufacturer in the U.S. for our U.S. demand and in Europe for our European and international demand. So the impact of tariffs from our business perspective is pretty minimal at this point.
Okay. Very helpful. Thank you for that. And maybe just continuing on with the P&L discussion and moving down the P&L to OpEx. You know, clearly the OpEx spend is going to start to pick up here as you build up the sales force and launch in the U.S. But John wanted to give you the opportunity just to kind of give us a little bit more color as we think about our models in 2026. Anything quantitative or qualitative that you'd like to provide?
Absolutely. So from an R&D perspective, it's very important that we continue to invest in innovation, some of the technologies that Olivier mentioned, as well as our Genio 2.2. So from an R&D perspective, we'll be pretty consistent on a quarterly run rate with where we've been to date through fiscal year 2025. We'll continue that into 2026. And then obviously the increase in our OPEX will really be coming from SG&A as we add those additional 15 territory managers. You know, rough scope and scale for fully loaded cost is, you know, kind of ballpark is around 400,000 for each of those particular classes. So as we think about driving SG&A up, that's where, you know, we can kind of think about the incremental cost of that class, if you will.
Sure. Very helpful. Thank you for all that, and another update from the Q3 earnings call. There was a concurrent announcement of a financing that you all did to shore up the balance sheet. It's a combination financing, I believe, equity and some convertible debt. Maybe just educate us on some of the finer points of that transaction and, you know, how do you think about cash runway now with that kind of in the rearview mirror?
Yep. No. Thanks. Yeah. It was financing that provides us the capital we need to continue to grow the business to go demonstrate U.S. commercial success here. In particular, over the next four to five quarters, the cash that we raise between the financing, whether it's the equity or the convertible debt, that gives us enough cash to get into early 2027. That allows us, again, to drive U.S. commercialization, demonstrate success here. And then as we need to continue to finance the business, we'll then make a decision. Do we raise enough cash to get to profitability, or do we raise cash to continue to drive the revenue growth at an accelerated rate at that point in time? But there's much-needed cash to provide us that flexibility to evaluate these options longer term.
Very helpful. I see the clock ticking down. We're 15 seconds or so. Olivier, would you like to just, you know, I guess close us out with anything that you're trying to message to the investment community here at our conference?
No.
We didn't cover?
So, what we did, I think we covered mainly everything, but I want to say that we are here to stay. I think that is important. We see a lot of enthusiasm, and I think it's great for an OSA patient that there is finally optionality and that there are also with Genio that they can benefit from.
Okay. Well, that's a great place to stop, so we'll end there, but want to say thank you again for joining us.
Thank you for having us.
Thanks for having us.