Good afternoon. I'm Robbie Marcus, the Medtech Analyst at JPMorgan. Very happy to host our next session with CVRx. gonna introduce the CEO, Nadim Yared, and for a presentation, then we'll do some Q&A. Nadim?
Thank you, Robbie. Thanks, JPMorgan here for inviting us one more time to present the story. I know there are some people on the webcast. I hope that you'll be able to follow the slides and hear my voice properly. First, I'm here on behalf of my team. I've got a wonderful group of people I work with every day, and I'm so blessed to have them. Actually 80% of them have been promoted internally in the organization. That shows the depth we have in this company. Let me step back and talk about heart failure for a second. Heart failure is when the heart of the patients become larger and larger, and patients loses energy, cannot walk, cannot breathe, cannot sleep horizontally, and over time, they unfortunately end up going to the hospital or dying.
Over the past few decades, there have been a lot of advancements in the medical treatments of heart failure. We have a lot of new drugs. Actually, the current crops of guideline-directed medical therapy are working very well. ACE inhibitors, beta blockers, ARB, ARNI, you name it. What we've seen is an improvement in the longevity of patients suffering from heart failure by somewhere around 1.4 to 6.3 years. Guideline-directed medical therapy works very well in prolonging the life of heart failure patients, but one thing is missing. The exercise capacity of those patients is not unfortunately improving with guideline-directed medical therapy. You're looking here at a compilation of 29 randomized control studies with thousands and tens of thousands of patients with the drugs, where it shows that the benefit in exercise capacity is very limited, barely there.
Luckily for most heart failure patients, a good therapy exists called CRT, cardiac resynchronization therapy, currently manufactured and commercialized by Medtronic, Abbott, Boston Scientific. It works very well in patients who have a wide QRS. Those patients are class one indicated for the therapy, but much less so for patients with narrow or intermediate QRS. It's for those patients that we have developed Barostim. Barostim is a platform technology, patented, and we're leveraging a mechanism of action called the baroreflex. All of us human would not be able to stand up without fainting if it wasn't for the baroreflex. We all have baroreceptors. Those are stretch fibers in the carotid wall, and they indicate to the brain the blood pressure with every beat of the heart. When we sit down, just lay down, stand up, they're sending information to the brain.
The brain uses this information and sends orders to the main organs, heart, arteries, kidney, to balance the blood flow. In heart failure patients, what we have made this, you know, observation over and over again is that the sensitivity of the baroreflex is down. Those baroreceptors are not sending the right level of information to the brain. The brain thinks, "Oh, I'm not receiving enough blood flow," so it reduces the sympathetic outflow. Actually, it increases the sympathetic outflow and reduces the parasympathetic. Let me explain those two. Sympathetic outflow, fight or flight mechanism. That's the gas pedal. In heart failure patients, because the baroreflex sensitivity is low, the brain is asking the heart to keep pumping blood more and more even during sleep, and the artery constricts and the kidney retains fluids. That leads to the exacerbation of the heart failure symptom.
Over the years, we've studied the Barostim, our technology, and we've demonstrated in clinical studies that it's very likely reducing the baroreflex sensitivity, therefore reducing the sympathetic outflow and increasing the parasympathetic outflow. There has been a question, does it affect and improve the symptoms of patients suffering from heart failure? We conducted studies and 2 randomized controlled trial. This is the second one, the pivotal trial. We call it BeAT-HF. We've demonstrated that Barostim improved the exercise capacity by 60 meters on a standardized test called the six-minute walk. That's about 20% improvement. Usually, a 25-meter improvement is deemed to be clinically meaningful. Quality of life improvement of 14 points. NYHA classification improving by 34%. You see at the bottom here the data from the pivotal trials of those CRT devices that I was talking how beautiful they work in patients.
You see that our data compares favorably to what they accomplished. You know, 29 and 39 meters in the six-minute walk, 11 and nine points in the Minnesota Living with Heart Failure Questionnaire, 20% and 30% on the functional status. Our data actually has been confirmed with, actually an objective endpoint called the NT-proBNP, which tends to correlate well with outcome, with reduction of mortality and morbidity. In summary, if I add the results from Barostim on the same graph I've shown earlier, you see that we're achieving here a similar level of benefit to the one achieved by CRT devices in their best sub-segments. That's pretty cool. Our therapy, you know, we build a business around it right now. There are five reasons why you may wanna pay attention to it. Five attributes, I would say, makes it pretty compelling.
Number one, large TAM. The market opportunity, when we talk about heart failure, we talk about millions of patients. We have to be careful. We have to select the right patient following the FDA approval of our device, so eligibility criteria in our approval. When we do the slicing and dicing of the data. Actually, we are a bit more conservative than the FDA labeling for our therapy. We, for example, remove patients who don't have access to healthcare or have other comorbidities. We end up with an annual rate of 55,000 new patients that would meet our eligibility criteria. You multiply this by an average selling price point of $25K, that's $1.4 billion annual market opportunity in the United States. Similar numbers in Europe shows about $1.5 billion, the total is $2.9 billion. Large TAM.
Second attributes, patient identification is straightforward. A patient that has heart failure with class 2 or class 3 NYHA with ejection fraction less than 35% is eligible for receiving an ICD, and that is in the guidelines. That same patient, if they received an ICD and not a CRT for heart failure, it's because they have a narrow QRS. They didn't meet the eligibility of the CRT device. There's only one more test that we need to do, NT-proBNP, a simple blood draw. If it's below 1,600, the patient's eligible for Barostim. Very simple. Third, the procedure is using two portion of procedures well-known. It starts like a carotid endarterectomy, but we don't cut inside the carotid. We just open up the skin, suture the electrode on the outside of the skin, and it ends like a pacemaker, but we don't insert anything in the heart.
We just put the implantable pulse generator in the chest and close it up. Skin-to-skin, about one hour. Fourth, hospital economics are favorable. 67% of heart failure subjects are above the age of 65, Medicare-eligible patients. Our focus has been to work with CMS on the coding and the coverage and the payment of our therapy. We're very happy with where we are today. The coding of our device is mapped to a payment level that averages nationally about $29,000. On top of which, CMS, over the past three years, have added a new technology add-on payment for outpatient procedure. It is called the Transitional Pass-Through, TPT. The sum of those two numbers differs ZIP code by ZIP code, somewhere around $40,000-$50,000. We sell the device with about $30,000.
There is enough margin for the hospital to pay the physicians, the cost of material and so forth, and the OR cost, and make some profits. 19% of the patients are covered by commercial payers. We follow the prior authorization process. Patient by patient, we help the patients, or the patient does it themselves, or the hospital does it. Submit the file of the patients, and they go through the process. If the private payers authorize the procedure, they do it. That's how we're doing right now, the procedures. Finally, our business model from a go-to-market strategy is very traditional. We hire sales reps, we train them. Once they've proven that they're good, we carve out a territory for them. We ask them in this territory to activate five centers. In every center, we ask them to do one procedure per month. That's it.
Initially, we targeted the top 200 sites in the United States in terms of volume of ICD procedures. Those top 200 sites did an average in 2019, 17 ICD every month. We just want one of those 17s to be receiving Barostim. 5 times 12 is 60 times an average selling price point of $25K, that's $1.5 million. Jared, our CFO, calculated that with this level of revenue per reps, we could become a profitable company. You know, I've talked about the five reasons why you wanna pay attention, but that is the chart that should attract your attention. This is our U.S. revenue since we introduced the product in early 2020. Of course, the first three quarters we had COVID. We're still trying to learn how to meet with a physician when we're not allowed to talk to them, right?
After this, it has been a steady growth. Yeah, you can see here the dip in Q4. Not a dip, but a slowdown when Omicron and Delta hit at the same time in December of 2021. Overall, this has been a fantastic story. In Q4, we did $5.9 million of revenue in the United States. What you see here, the blue line is the addition of reps or territories, 26 by the end of the year. The purple line growing up is the number of active implanting centers. We added 15 in Q4 for a total of 106. Worldwide, we did in Q4 $7 million-$7.1 million. That's our forecast. The final numbers will be released toward the end of January, early February.
The average selling price in Q4 was very nice, was $30.9 thousand, slightly above what we had in Q3. I mentioned earlier, we added three territories for a total of 26 by the end of the year. We had 106 active implanting centers by adding 15 in Q4. From a cash position, we end up the year with $106 million. I need to note in here that we drew only $7.5 million from the $50 million debt facility that we signed up in October. We did not use the ATM at all. If there was any question of how much shares CVRx sold, zero. We did not use the ATM yet. We still have this facility available to us. $50 million, we'll use it when we need to.
For the full year here, the number will be about $22.3 million-$22.4 million, with our U.S. heart failure revenue 17 and a half million dollars, which represents a growth year-over-year of 108%. The guidance for 2023, we expect revenue to be between $35 million-$38 million next year. Gross margin between 78%-79%. Our operating expenses, including the non-cash operating expenses, between $76 million and $80 million. For Q1, we expect our total revenue to be between $7.1 million and $7.5 million. Switching gears here to talk about the R&D roadmap. Last year, we introduced a new generation of IPG, implantable pulse generator, with the new programmer. We spoke about that.
Our trial design has a post-market component that would allow us to study the effect on mortality, morbidity. I will talk shortly about this because that is an important element that many people are asking questions about. We have developed this new procedure toolkit. We call it BATwire. This is an ultrasound-guided instrument kit that allow us to implant the lead, the same lead that we have today, but with reducing the size of the incision in the neck. That would allow an interventionalist, such as electrophysiologist, to do the procedure if they wish to. Going back to the new data that will be available in the 1st half of next year. I need to step back and explain how the trial was designed.
BeAT-HF is our pivotal trial. Under the breakthrough designation from FDA, we designed a two-in-one trial with a pre-market and a post-market in the same trial with the same patients applying to both. The first 408 patients at 6 months were the data that we used for the first approval. We used 264 of those. That's the intended use population. At six months, we collected the evidence that we needed, the NT-proBNP, six-minute walk, and quality of life. That led FDA to conclude that our device is safe and effective and that the benefit outweigh the risk. We got a PMA approval. We started the commercialization based on that symptomatic improvement of the device. After that, we added 59 additional patients. We kept following those 264 patients.
Now some of those patients have been followed by more than six years. On average, more than three and a half years of follow-up per patient of 323 patients. We are now compiling data on the mortality and morbidity impact of the therapy. The way we do this is collecting event. One cardiovascular event is either a cardiovascular mortality, so death because of a cardiovascular nature, or the patient receiving a left ventricular assist device or a heart transplant or a heart failure hospitalizations or an unscheduled ER visit. Any one of those is considered to be one event. We count all of the events of all of the patients over time. Once we hit 320 events, we stop the counting, then we analyze the data, and then we compare the two arms, the treatment arm versus the control arm.
Where we are today. In December, we accrued all of the 320 events that we need. Now we're waiting to finalize the monitoring of the sites, which somehow is in our control, the independent monitor we hire, but somehow is not in our control because we need the research coordinator on the sites to allocate the time to work with our monitors. That's the uncertainty right now in terms of duration. That's why we're saying that we will be unblinding the data in the first half of this year, but we have not narrowed down yet this window. As soon as we finish the monitoring, we will be in a better position to tell you folks a more accurate or a narrow window for the availability of the data. There is the primary endpoint, and yes, it's a yay or nay.
Have we met the statistical significance, or have we not met the statistical significance? That's the easy answer. The difficult answer is more subtle than that. The device is approved. It is safe and effective, the benefit outweigh the risk. What we are looking for here is for additional evidence that would allow FDA to allow CVRx to make more claims. Does the device have more benefit or additional benefit on top of those symptomatic improvement that we've seen? That's a different equation than when FDA is looking at whether the device is safe and effective and whether the benefit outweigh the risk. Still, it has to follow scientific rigors, will still be a negotiation between the sponsor, i.e. CVRx, and FDA. We will ask for more claims. FDA will push back, we'll provide less claims, right?
FDA, to make their case, will use the totality of the evidence. What is the totality of the evidence? Well, you have everything that we're collecting in the trials, symptomatic data, plus those mortality, morbidity. There are multiple ways of analyzing the mortality, morbidity data. I gave you one, the one that we selected for the primary endpoint. It is the most important one, but that's not the only one. For example, we counted every event the same way, but they don't have the same severity. There's another way of counting those events. For example, the win ratio analysis will provide a more accurate way of taking into account the hierarchical severity between those events to compare patient to patients. That is one of the pre-specified ancillary analysis that we have previously discussed with FDA and that we will analyze and will provide this data to FDA.
Whether FDA will allow us to use any of the outcome of those pre-specified analysis to make additional claims is uncertain. When we unblind the data, we will be coming to you and trying to tell you, at least we cannot tell you the full picture. Instead of clinical report of 220 pages, we will not have it ready in a short time, right? At the same time, you don't want me to wait six months to tell you what we're doing. I need to be able to tell you more than just the endpoint, but I cannot tell you the full story. I have to make a judgment of how much I can disclose to you in the shortest period of time, so that you can make your decision in here about what to do with the investment.
That will be our challenge, but we're up to it. The other thing that we need to take into account is when I'll tell you the data, we would not have heard back from FDA. We may not have submitted yet to FDA all of the data. You know, writing this clinical report of 200 pages will take some time. I will tell you what I believe. You know, I believe how to interpret the data or how I interpret the data. Then you will have to make your own judgment about what you believe that FDA will react to the data or not, right? I cannot speak on behalf of FDA. If we meet the endpoint, it's an easier answer. Yes. I believe we have a good chance of meeting the endpoint.
The challenge is if we did not meet the endpoint, but we meet other ancillary analysis, what does this mean? All right. That's what when we talk about unblinding of the data, this is what will, you know, happen in the next six months. In conclusion in here, we have a great platform therapy that can address multiple diseases. I just spoke about HFpEF today. You know, another day we can talk about hypertension and HFpEF and other indications that we will go after. In HFpEF in the U.S., it's already a large TAM with a $1.4 billion annual market potential, even excluding the replacement market. Identification of patients is straightforward. The procedure is a one-hour outpatient procedure. There is a favorable reimbursement currently. Our commercial launch, you saw this graph. It's very attractive.
We have our own manufacturing in the heartland of the United States. In Minnesota, we produce our own IPGs, we produce our own leads. We have an attractive financial profile. I mentioned the gross margin. We have a solid balance sheet with more than $100 million available. We have an experienced leadership team. With this now, Robbie, I think we have enough time for some Q&As, right?
Yes.
Fantastic. Thank you. This one?
Yeah. Please.
Maybe we could start with fourth quarter. You pre-announced, what was it? $7 million-$7.1 million.
Yeah, that's right.
Maybe you could talk about some of the trends you saw throughout the quarter, and how it compared to your expectations.
Yeah. We had guided going into the fourth quarter that we had expected to report between $6.5 million and $7 million. The way the fourth quarter played out was consistent with what we saw in Q2, Q3, where we were able to continue to activate new centers, not only getting them on contract, but also starting to see new patients be treated at those centers, and then also just then start to deliver revenue. Just slightly exceeding the top end of that expectation.
What are you seeing in terms of your physician user base? Are you seeing greater adoption across the newly trained doctors? Is it a small cohort that's doing a lot? Maybe help us understand how the volumes are spreading out across your physician base.
Yeah, it's a good question. One thing we've talked about a lot over the last couple of quarters is that the longer a center has been with us, the more patients they're treating on average. The centers that have been active for less than 12 months are doing a little bit less than the centers that have been active for 18 months. We're doing a little bit less than those centers that have been with us for 24 months. It seems like the program is working, right? As physicians get more experience using the device, they're more likely to treat more of their patients that they're seeing on a regular basis.
When you go into a hospital, what's the pushback you're getting today to the therapy, and how has that changed over the past two, three years since you initially launched?
You know, the process has changed a lot over the past decade. It used to be you go to a hospital and the physician wanted to use a stent, and then you bring a stent and you send the invoice after. Now we have to go through a contracting process that includes the value assessment committee. The only pushback that we see in this often comes from heart failure specialists. Surprising, isn't it? We have a heart failure therapy and you wonder why heart failure specialists might push back against the therapy. Well, heart failure specialist focuses mostly on LVADs and heart transplants. What Novartis has done over the past five, six years is train all the general cardiologists to prescribe Entresto.
Now most of the heart failure patients with class two, class three are treated by general cardiologists, sent directly from the GCs to the electrophysiology department to get the CRT or ICD devices and brought back to them. What's in it for the heart failure specialist? Nothing for our therapy. Why are they invited when they have the heart failure in their title? What do they believe in? Mortality. Not even morbidity. Why? They deal with class four heart failure subjects who are at the edge of passing out. They're dying. You know, needing an LVAD or heart transplant. That's their focus. We don't have a mortality benefit. We don't have data to even suggest one. That's the pushback we receive from some heart failure specialists. Of course, after we go through their education and we walk them through the data, they understand it.
Just on paper, if we're not there, they will push back on us. From the administration so far, they look at the financials. There is some misunderstanding of what the TPT is. You will be surprised how many CFOs have no idea what a TPT or Transitional Pass-Through or add-on payment is. Some of them have been hurt in previous cardiovascular therapies like the WATCHMAN or CardioMEMS, so they raise this to us. They say, "Well, okay, we'll approve it, but only for one or two implant. Let's see what the payment comes back, and then we'll do it." What Jared has done is an interesting analysis. We looked at all of the implants from day one, put them all on, in all of the sites, all of their first implant from day one of the first implant.
You see a blip one, two, then a silence for three, four months, and then the growth. This three, four months, administration waiting for the payment to come back, and the doctor's waiting to see the impact on their first two patients to feel good about the therapy, and then it picks up. It's not really a pushback, but kind of what we're up against.
Yeah. The gist of my question, what is the payment rate? You know, what's the rate of denials that you're getting on reimbursement?
For private payers, we have not disclosed this. For CMS, it's paid.
Mm-hmm.
Yeah. We wouldn't have a denial.
Got it. Maybe if we look to the guidance, $35 million-$38 million. Walk us through what that assumes at the low end, what that assumes at the high end, how does the mortality readout picture into this?
Yep. One thing we've been consistent about since the IPO is that our base case model assumes what we have today into the future, that any readout from the morbidity mortality data would be neutral at best, right? Without any additional indication expansion. That's not based on us being pessimistic. This is just us taking a conservative approach in building the long-term model for the business. As we look into 2023, we see continued growth in the US heart failure business, where we're making significant investments in the US heart failure team, the sales team. Not investing significantly on the European side. We've continued to see headwinds there, both from an FX perspective and an adoption perspective, as we haven't made as many investments in that sales and marketing organization.
If we think about the low end, you know, it's assuming we're gonna start to see high single-digit adds in the U.S. heart failure, new centers. On the high end, we're gonna see mid double digits, maybe high double digits, to be able to achieve those growth targets that we had set for the U.S. business.
What about in terms of territory managers?
Yeah. We've been adding at a consistent pace of about three per quarter since the IPO. We feel like that's a pretty good pace to continue on to be able to achieve the numbers that we put out for 2023.
When you look out over your long-term plan, you talked about a one and a half million dollar rep productivity per year.
Yep.
Do you have any reps up that... I mean, you know, where do you sit right now? I could do the math.
Yeah.
What's the spread of rep productivity? Is it some at the high end? Is it some at the low end?
I mean, we've been adding reps at such a fast clip. We went from 14 at the end of 2021 all the way up to 26 at the end of 2023, right? There is a wide spectrum of productivity out of the rep classes that we've carved out territories for. We're not there yet. We have some that have achieved the long-term targets, but again, the idea is to get the whole business up to that average that we could reach cash flow breakeven. We're gonna continue to make investments to add to the team, which will obviously drive the average rate down, right, as we have those newer reps coming on board. Longer term, we see them all getting up to that $1.5 million target.
Similar question, but on the physician user base. How does that look if you plotted everyone out in terms of utilization? Is it very clustered at the high end? Is it a lot of people at the low end? What does it look like?
Yeah. Again, something we've talked about in the last couple of quarters is we have more than a handful that have started exceeding that expectation of treating more than one patient per month on average. But the rest of them are kind of falling into that group of, I'm gonna treat a patient this month, maybe take a month off as I'm looking for the right patient, treat a patient the next month, so about two per quarter. It's still kind of in that spectrum of trying to push them to that long-term average of one or more per month.
If we switch to the readout that we should be getting in the next couple of months, there are other therapies not too far off from yours that had $1 billion plus in sales with just a, you know, a quality-of-life benefit...
Mm-hmm.
that didn't. Eventually got a, an outcomes label, but it took many years and was already north of $1 billion in sales. Can your therapy be very successful with just the quality of life benefit, or do you need a mortality benefit in order to see the sales that we'd like?
Robbie, this is an excellent question. I'm so glad you'd ask it. Many of the audience here on the webcast is a medical device-focused audience. In medical devices, the vast majority of devices improve quality of life or functional capacity of patients. Whether it's a spinal cord stimulation for back pain or a deep brain stimulation for Parkinson or a hip or a knee, artificial disc, none of them has proven a mortality benefit or a morbidity benefit. Yet many of them have grown and become multi-billion dollar market opportunities. Yes, I believe that our therapy, with the indication we have right now, has that potential if we continue what we're doing, which is educating physicians and payers about that.
I wanna be clear about what you were talking about in the data readout. That even if it doesn't show a mortality benefit, there's still a lot of data that the FDA can look at to potentially add label indication around that. Any kind of examples that, you know, just to kind of put a finer point on it of something that they may look at?
Yeah. Let me take an example that happened to us in the past.
Mm-hmm.
Okay? Let's not talk about hypothetical. In BeAT-HF, the three primary endpoint for the first phase were six -minutes hall walk, quality of life, and NT-proBNP. The functional status, NYHA, was not there. It's not a primary endpoint. FDA looked at all of the evidence, the evidence was super solid, they allowed us to add that claim in the labeling of the device. That's what I'm expecting this time around, is we'll have the totality of the evidence, we'll analyze it, FDA would analyze it. We'll make the case, FDA would look at it. They will try to make the counter point. They'll double-check it, you know, crosscheck it in every single direction, try to impute the data, try to figure out, is this a fluke or is this real?
If they conclude this is real, they will allow us to make claim, and then the discussion will become about the language that we may use. For example, FDA might say. We might ask to say, "This device reduces the severity of hospitalization." FDA will say, "Well, the evidence suggests that. It doesn't demonstrate it. Therefore, you can only say this device may reduce." All right? That's when we say labeling, that's what we mean about, you know, the claims. We have to be very specific. Whatever FDA says, that's the only thing we can say.
Mm-hmm.
If we then try to say anything more than this, that's straight to jail without, you know, stopping by.
That's it.
Go, right?
$35 million-$38 million does not include any positive readout from the trial.
Correct.
Doctors will see that data at some point over the next few months. If it is positive, I would imagine that would almost certainly help, you know, enthusiasm for the product. Help investors level set. Once the data comes out, how long do you think it'll take before your reps are able to go in and detail it? Do you expect just a natural benefit throughout 2023 if the data is positive without formal approval?
Yeah. There is the sum of two effects there. Effect number one are physicians self-educating themselves, reading the manuscripts.
Mm-hmm.
-watching the news about, you know, the late breaker clinical trial or the doctor, the doctor discussion. We as a company, so our reps, will not be able to say anything until we get the clearance from FDA for the labeling. How long would that take after we submit the data to FDA? I expect six months. FDA might need to convene a panel of experts, and if they do, it will prolong more than six months. We don't know. That's why we're taking a very conservative approach. We're saying, "Let's assume the data is neutral. There is nothing there." That's the $35 million-$38 million information.
It sounds like you don't 100% have it decided where or when it will be presented.
Interesting question. We cannot sleep on the data for too long.
Mm-hmm.
Right? This is material to CVRx. Because of that, it's very hard because when you submit the data for a late breaker, you have to do it like six months in advance. We'll try to see if we end up with the unblinded data analyzed and ready close enough. We'll try to see if we are allowed to do it at a late breaker.
Mm-hmm.
If it's too far out, meaning two weeks, three weeks, six weeks distance, we'll do a press release with possibly opening up a session with a physician talking about the data and allowing investors to ask questions. Hopefully, if there's still some left, then we'll keep it for the late breaker.
Got it. maybe if we turn to the P&L and the cash burn and the $103 million that you have on the balance sheet. Clearly, you're in growth mode. How do you think about balancing investment versus growth?
Yeah. It's a great question. We've had this top of mind since we did the IPO, right? We knew that we wouldn't be able to grow at all costs, that the raise that we did at the IPO might be our last, right? We had to make sure that that money would get us all the way to cash flow break even. That's how we've been building our model. We ended the year with $106 million in cash, of which $7.5 million was drawn down from the new debt facility that we opened up here in the fourth quarter. It's a total facility of $50 million, so we do have an option to pull down an additional forty-two and a half million dollars if needed.
What we saw throughout 2022 was a burn, kind of in that $10 million-$11 million per quarter range. We started to plateau this year, and we feel like we're gonna be on that plateau throughout 2023 based on the guidance that we've given. Then we'll start to see that number come down as we move into 2024 and start to see a little bit of leverage built into the P&L to be able to get to cash flow break even with the money we have on the balance sheet.
What revenue run rate do you think that is about?
We haven't disclosed. Part of this is just gonna come down to how many reps and how quickly we're gonna be hiring as we get out to 2024, 2025 timeframe. If we feel like we can start to accelerate the number of reps that we're bringing on on a quarterly basis, we may do so, as long as we don't hurt that long-term goal of reaching cash flow breakeven.
It seems like right now the international business is just in maintenance mode.
Mm-hmm.
Have you evaluated whether it actually makes sense to be in Europe right now as you're focusing on the US?
It's a great question. We cannot leave Europe. We had patients in clinical trial. We had patients implanted commercially. Leaving Europe, meaning stopping support for those patients. We need to keep Europe, at least from a break-even perspective, as a separate entity, and that's the maintenance mode you're talking about. That said, I made a strategic mistake. I assumed that I can keep Europe flat by not investing additional money there. All it took is one sales rep to retire, and that's 25% of our business, that it takes six months to hire another rep in Germany and another nine months to train them. That's a problem. We made a decision about a year ago to start investing a little bit more.
Mm-hmm.
That maintenance mode is still a growth, but not a big, not a U.S. type of growth.
Got it. Just wanna check, are there any questions in the room?
Rob, I wanna just clarify one more point.
Yeah.
about the data and the estimate and why do we take a conservative approach. When we built our model, Jared was very clear. We should assume that this is what we have, and anything else that we can get will be upside to the model. Think about it as a call option. It does not mean that I don't believe that we will win the endpoint. you know, when we start the trial, I spent eight years of my life in this trial. I didn't design it in a way to lose it. At the same time, I wanna make sure that even if I don't, we still have a growth business that will still accomplish the objectives. I wanna make sure everybody understand that.
We all like numbers to go up, not down.
Okay. Good. Good.
Well, good. Maybe if there are no questions in the room, we're about out of time. We could end it there. Thank you so much.
Fantastic. Thank you so much, Rob.
Thank you, Robbie.