Hi, all. My name is Caroline Barowski, and I'm part of the Healthcare Investment Banking group here at J.P. Morgan. It is my pleasure to introduce Dev Kurdikar, the CEO, and Jake Elguicze, the CFO of Embecta.
Good afternoon, everybody, and thank you, Caroline, for having us. It's a pleasure to be here with you today. With me, as Caroline mentioned, we have Jake Elguicze, our Chief Financial Officer. Pravesh, our head of IR, is in the audience as well. What I thought we would do over the next 20 minutes or so is give you a little bit of an update on where we are at our company, talk a little bit about our path forward, and I know we'll have some Q&A towards the end as well. But for those of you, and this is our forward-looking statements language, for those of you that don't know us, because we are a new company, let me just take a moment to tell you who we are. Embecta is a company devoted to developing and providing solutions for people with diabetes.
We are a new company. We spun out of BD a little less than two years ago, in April of 2022. But this year will be the 100th year that we've been in business. Embecta and the predecessor company was the first one to create a specialized insulin syringe. That was in 1924. So certainly a new company, but it's a business with a long and rich legacy that we are proud of and certainly look forward to carrying in the years to come. Fiscal year 2023 was an important year for us. It was our first fully fiscal year as an independent company, and we had a string of achievements. Our team, I'm very proud to say, had strong execution, notwithstanding what was a challenging external environment.
About a year ago, we won the Readers' Choice Award from MD+DI. It's a trade magazine, as the 2022 MedTech Company of the Year. And then, given that we were a new company, we certainly established what I would say is a world-class leadership team. And I don't mean just at the senior levels, but at one or two levels below the organization as well, with the focus and experience needed to complete all the separation and stand-up work, as well as over the long term, really position the business for long-term value creation. And when you're a spin-off and you're establishing a new company, as is often the case, there is a lot of stand-up work that you have to do, and we certainly did our fair share in fiscal 2023.
We established our whole global HR information systems, payroll systems, CRM systems, IT network, and we continued to exit transition services agreements with BD. An important part of those separation activities was ERP implementations. We have a plant in China, in Suzhou, and at spin, that was still a deferred entity at close, so the legal ownership was still with our parent. We have to go through a demerger process over there to transfer that ownership from BD to us. That's a multi-step process that takes several months. I'm pleased to say we've progressed far along on that path, but as part of that process, we had to shut down the plant while we got a business license. We took that opportunity to implement our ERP. That was our first ERP implementation over there.
Per plan, we were able to bring the plant up and make it operational, and that plant is now producing product for export from China to other markets. We also completed an ERP implementation, set up a brand-new distribution network, and stood up a shared services network to serve our customers in U.S. and Canada. That happened in November of last year, and we implemented all of those systems, processes at our plant in Holdrege, Nebraska. That was the second plant, and I'm very pleased to say that all those implementations went very smoothly. These are complex projects that obviously took a lot of organizational capacity through the year.
And then, beginning this month, we announced in November that we were pleased to be awarded contracts with three of the top Medicare Part D players, where we are now either the exclusive provider or dual preferred on their formulary lists. Why is this important? It's important because seniors tend to have a much higher prevalence rate of diabetes than the general population. And just given the advanced stage, they tend to be more likely to be insulin users. So winning these contracts is an important part of just continuing to bolster our core injection business. And some of you might have seen yesterday that we announced a submission of a 510(k) for an insulin delivery system.
This was something that we had telegraphed even prior to spin, that this was a project we were working on and that we were continuing to advance, and I'm pleased to talk about this milestone. I'll certainly talk a little bit more about the patch pump in the coming moments here. Our revenue for 2023, we reported revenue of $1.12 billion. That was a reported growth rate, a decline, really, of 0.8%, driven by foreign exchange. Our constant currency revenue growth was 1.6%. Now, embedded in that revenue is contract manufacturing revenue. This is for products that we manufacture for our former parent. This contract manufacturing revenue, we have always expected would tail off over time, and it certainly did a little bit in 2023.
If you exclude the contract manufacturing revenue, our constant currency growth rate was slightly higher at 1.8%, and that's truly reflective of the core injection business. On the U.S., it was 0.2%, again, excluding contract manufacturing, it would have been 0.3%-0.5%, and international growth was 3.2%. International is an important part of our business. As you can see, almost half our revenue comes from outside the U.S. And within that, emerging markets has been and continues to be a growth driver for us.
So the 3.2% was certainly aided by strength in emerging markets, as well as we did benefit in 2023 from a competitive product shortage, and we were pleased to be able to step in and ensure continuity of product supply for customers if they couldn't get a competitive product. We were also pleased in 2023 to continue to sort of increase our guidance throughout the year. And I've already spoken about the revenue, which is on this right-hand side, the top number. But let me talk a little bit about the margins. You will see that our adjusted gross margin was 67%, our adjusted operating margin was 29.6%, adjusted EPS $2.99, and then Adjusted EBITDA margin of 33.8%.
I'd, I'd sort of stipulate that these are strong margins, certainly for a, for a business of our size. And in addition to the impact of revenue, we did, I think our team did a great job of managing through inflationary pressures last year, being able to optimize price where appropriate, and being mindful of the costs that we incur as we are standing up the company. And these results truly are a testament to the dedication of the team, the resilience of the business, especially when you take into account the significant amount of organizational capacity, and candidly, cash, that was used in all the separation efforts. So for 2024, where do we go from here? We have three priorities. These are the same three priorities that we've had since spin. These are multi-year programs, if you will.
So hopefully, it's not a surprise that the priorities are the same. But to sort of refresh everybody's memory, we want to continue to strengthen and optimize the core business. This is important for us. It's a very stable business. It's products that are needed and used by, we estimate, almost 30 million people around the world, and it generates a significant amount of cash. And obviously, we don't know what this year will bring, but certainly, we've demonstrated in the past that our team can sort of manage through an uncertain operating environment and will be mindful of managing costs. The second thing we have to do is continue down our separation and stand-up efforts, and we look forward in this year to substantially completing a lot of our stand-up work.
I talked about some of the ERP implementations I've done, and I'll talk a little bit about that in a minute, but we have to complete what's remaining. And as we are doing that, certainly, we are operationalizing our systems and processes, and we'll continue to exit these transition services agreements with BD. Completing the separation work allows us as a company to start off standing on our own two feet, if you will. And then our third priority has always been to say, "Look, we are in a therapeutic area with significant unmet need. We are a focused company in diabetes. We have strong emerging market infrastructure." And the reason that's important is because there is disproportionate growth in diabetes in emerging markets. So how do we transition this company back to long-term, sustainable growth?
And so we've continued to invest in that, notably in our patch pump, and over time, we will seek and sort of look for the right M&A and business development opportunities as well, because we recognize that to create long-term, sustainable value, we need to get the revenue growth up in a very sustainable manner. I said we have to complete our ERP implementation, so let me talk a little bit about that, because this is certainly a key, key separation project that we need to make significant progress on. But before I do that, let me just highlight what we've finished. You will see in the middle left-hand side of the page, our plant in Suzhou, China. That's one of our newest plants.
That's the one that we are going through the demerger agreement, demerger process for, and that's the one I said that was our first ERP implementation, so that's done. And then more recently, I said we finished implementing our ERP at our plant in Holdrege. That's the site for—It's the site where we manufacture insulin syringes. And when we converted ERP, we put in a new distribution network, new logistics services providers, and a new shared services infrastructure so that customers can call, place orders, all the regular sort of back-office work that's done. And all of that was done simultaneously. So now 60% of our revenue and two out of three of our plants are operating, if you will, on our platforms and our infrastructure.
I'm very proud the way this was done because we were able to complete these projects without any significant disruption to our patients and customers. What's remaining, obviously, is our third plant, our plant in Dún Laoghaire, Ireland. That's where we make pen needles, as well as 40% of the revenue. Now, admittedly, that 40% of the revenue is over a large sort of country base. Our products are available in 100 countries around the world, and so there is complexity there that we are going to sort of work through and finish.
I did say on our last earnings call that we did ask our former parent, BD, for a limited extension of our TSAs for a limited set of markets, for a limited set of time, that they have agreed to grant, conditioned upon getting a supplemental private letter ruling from the IRS. So we are continuing to make progress. Allowing that getting that extension will frankly just allow us to phase these implementations and mitigate any residual risk there might be. But so far, we've been successful in our implementations, and certainly we are spending a lot of time and energy and resources making sure that the rest of those go well.
Our patch pump, this is clearly something that we've been working on for a period of time, and even before we spun off, we had an investor day, now approaching two years ago, and we had laid out projections, if you will, through FY 2024, where we had laid out, you know, what potential investors might expect in terms of R&D spending. And we had also pointed out that, you know, not to expect any revenue from a patch pump in fiscal 2024, and the guidance we gave most recently for 2024 just was very aligned with what we had said. All along the time, we were working on developing this patch pump, and I'm pleased to say that the filing we made was aligned with our plans from two years ago.
The filing was for an open loop product, and we were very purposeful in that. Our goal here is to have a closed loop Type 2 pump, but submitting an open loop because the hardware is done, allows us to de-risk, if you will, the complexity of the project somewhat. We also believe that the open loop pump, there is a customer segment that might want it, and we've designed it specifically for Type 2. A notable feature of this is just frankly a larger reservoir, 300 units. The reason that's important is because Type 2 users, on average, need up to 100 units of insulin a day. So if this pump gets indicated, as we would expect, for three-day wear, you want to have enough insulin for that three-day period.
That's obviously important to people with diabetes that will use the pump from a pump change-out perspective, but it's also potentially important to payers, just given the number of pumps they would need. So we're very pleased with the submission. In parallel, we have been and will continue to work on the closed loop version of the pump. We signed an agreement with Tidepool. Tidepool has a standalone 510(k) approved Type 1 algorithm. We continue to work with them on integrating that algorithm because that's going to be an important part of the closed loop solution. And the way we expect this would play out is, while we are undergoing FDA review on the open loop, we'll continue to work on the closed loop.
We'll get the work done on the integration of the algorithm, at the right time, file an IDE with the FDA, which will then, upon approval of that, allow us to conduct a clinical trial, which is going to be needed for a 510(k) submission for the closed loop. So very pleased with the progress that we've made, and I'm particularly glad that we've been able to execute this program, along with all the other things that I talked about, simultaneously over the last couple years. I do want to take a few minutes because certainly over the last six months, there have been a lot of questions on GLP-1s and the impact of GLP-1s on our business. So I did want to take a few minutes to just talk about and at least share our perspective on the impact of that.
One of the first things we did was we just looked at insulin prescription trends, and on the bottom left here, you see data over the past six years, where you have insulin prescription trends. That's the top line. But then you see the GLP-1 weekly. That's the light blue line, right? Ozempic was launched in January of 2018, and that's certainly, that has had a CAGR of 43%. Mounjaro was in 2022, and you see that pink line over there, and insulin has had a negative CAGR of -2%. Now, you will notice, if you look closely enough, that that dip begins to occur around the COVID years. And while we have not quantified the impact of COVID, I think you all know that COVID had a disproportionate impact on seniors.
Seniors have a much higher rate of diabetes than the general population, and again, as I said earlier, when I was talking about Medicare, are more likely to be insulin users than the general population, right? So those things had an impact as well, but we don't know enough to be able to say how much of that negative 2% was COVID or GLP-1 or other factors. But the fact of the matter is that the insulin has not changed dramatically, even though GLP-1s have grown. The other thing we looked at was to just see switching. How many people stopped taking insulin because they were using GLP? And that number is small as well, as you will see on the table or on the chart on the right.
What's perhaps even more pertinent to us is: What has our business done? Right, so the first thing to say is, about half of our business is outside the U.S., and the pressure of advanced therapies is really concentrated on the U.S. It gets a little bit, you know, sort of buffered outside the U.S. simply because of cost and affordability and access concerns. When we looked at our business, and now you see this all the way from fiscal 2017, which is the year before Ozempic launched, right? All the way through last year, you will see that our U.S. injection revenue, and it's injection revenue that excludes the impact of contract manufacturing that was gonna come and go, has had a CAGR of 1.2%, a positive 1.2% CAGR.
That is in spite of the GLP-1 growth, but there is one other factor that impacts this, right? Which is the adoption of pumps. Pumps adoption, specifically in Type 1, has increased, I would say, from say, low 30s to high 30s or maybe pushing 40% today. So in spite of all of those factors, our business from a revenue perspective has stayed stable. So that's what, if you look back, you see. Now, with GLP-1s, and GLP-1s are delivered via syringes or pens or auto-injectors, and the companies that are now, at least for now, two of the three companies that make insulin are also in the GLP-1 business. Now, if they are delivered via pen injectors, our pen needles are compatible with them already.
If they come via vials, you know, our syringes are indicated for insulin, so we would need regulatory approval in certain countries before they can be marketed. But in certain countries, health authorities have already indicated that you could use insulin syringes for GLP. We are not currently in the auto-injector business, but if you look at the manufacturing competency required, these are high volume, high quality injection molded parts, and that is a core competency for our business.
It is something that if we wanted to get into, we would have to really think about it from an M&A or business development perspective because of the long life cycles of drug development and the, you know, you sort of partner with drug companies early on in the process so that the auto-injector that you are developing becomes part of their, of their solution. But certainly, as pens and GLP-1s become available in pens, our pen needles are compatible with those pen injector devices. And so for us at Embecta, you know, with everything that has gone on over the last few years, I mean, our core thesis for the spin, which was significant opportunity exists to help people with diabetes, that remains unchanged. Whether it's injection devices, we are the world leader. We have category leading share in most markets around the world.
I mentioned right at the outset, we have a 100-year history. Our products are very well known and trusted by people around the world, and there's incredible stickiness of our products. Whether it be for GLP-1s, partnerships, especially as some of the older GLP-1s become generic, and if they are delivered with pens, there's an opportunity there. And then regardless of the impact of GLP-1s on injection devices, we believe there's a large market in Type 2, insulin-intensive users, these are people that need multiple daily injections of insulin, where we think our pump, upon clearance, can play a big role in solving some of their unmet needs and certainly create, you know, a large revenue opportunity for us over time. So I'm very pleased to be here today and talk about what we've done and our path forward.
With that, I'm gonna conclude and turn it over to Caroline. Thank you for your attention and for your interest.
Thank you. Thanks, Dev. Okay, sorry. Dev, thank you for joining us at the conference again this year. To be the CEO of a company that was spun out from another publicly traded company is quite a unique experience. It's been about 18 months since you've been a publicly traded company. During those first 18 months, what have you and your team been focused on, and what has gone according to plan, as well as what has arisen that caused you to change your original plans?
First of all, you—I think you're kind when you called it a unique experience. It's certainly quite an experience. So let me remind everybody, so we spun off on April 1. That was a few weeks after the Ukraine war started, and certainly, what happened soon after we spun off was very different than I think most of us thought what the world was going to be. We launched, if you will, with three core priorities, right? And we had laid out financial projections through 2024. The Ukraine war started. Inflation turned out not to be transitory, as folks had once thought, and rose rapidly. There were supply chain disruptions. We were still fighting through COVID in certain areas, especially in certain markets that are important to us, like China and Japan.
FX sort of went the other way on us, and given our large international exposure, that has an impact. All of those factors together, you know, just to give you a sort of back-of-the-envelope estimate, we think impacted us by about 500 basis points in margin pressure. And I think, again, it's a testament to the dedication of the team and the resilience of our business, that we were able to absorb that and still issue guidance for fiscal 2024 that was aligned with what we had said before all of these things transpired. I think what has gone, frankly, maybe better than any reasonable person would have expected, is just how well the team has executed in a very challenging environment and with all these separation projects.
Again, just to give you a sense, I mean, these separation projects in fiscal 2023 alone probably had a one-time use of cash of $140 million plus. So you can just imagine the amount of resources that go into it. So I would say that's gone, well, and I just sort of presented a litany of things that I think we wish would not have gone the way that they did.
Thank you for that overview. Given what you've said, what are the key priorities for Embecta during 2024, and when do you expect to be fully separate from your former parent?
Yeah, so I mean, I know I listed the general priorities, but let me be a little bit more specific about them, right? So for our core injection business, particularly in emerging markets, we wanna make sure that that remains a source of growth for us. We are investing in things like e-commerce, where that channel is picking up a little bit. It's small, but picking up, and potentially could be important in the years to come. We are investing behind trying to figure out how to decrease the reuse rates. I mean, our products are single-use products, but we know even in developed markets like the U.S., where there is stable reimbursement, those products get reused. So we are investing behind things like that, just to ensure that our core business remains strong.
Certainly, we want to continue winning the kinds of contracts that I mentioned before. The Medicare recent wins were a good example. They help fortify and bolster our business. On the separation front, we do want to complete the separation of the remaining plant and the rest of the markets. With respect to timeline, look, I mean, I expect that, you know, we should be able to substantially, I'd say, be done certainly by the end of this fiscal year, which, you know, is in the remaining nine months. That will really help us solidify our foundation and, you know, certainly for me and the rest of the management team, you know, we'll, we'll pay more and more attention to sort of how do you get that revenue growth growing or, or increasing in a, in a sustainable fashion.
And third one, again, to be very specific about this, for the patch pump, is to ensure that as we get questions from the FDA, as they're doing the review, you know, respond to them as expeditiously as possible. And resource for success. I mean, there's a lot to be done in taking a product that is, you know, just submitted for 510(k) and making a commercial product, right? Including working through how you're gonna support the product once it's out in the field, how you're gonna manufacture it at scale with quality. So there's a lot of work, and that's gonna be an area of focus for us, as part of that third priority in fiscal 2024.
Over the past decade or more, there has been a lot of innovation in the area of diabetes management, including people with diabetes transitioning to insulin pumps and alternative therapies like GLP-1s, yet your business has been able to remain stable. Why is that?
Yeah. So several reasons. One is, you know, I know we talk a lot about the therapies, but fundamentally, there is growth in the number of people with diabetes, right? It's worldwide. That growth is disproportionate in emerging markets, where we have a strong presence. More than half of our commercial people, or at least half of our commercial people, maybe I should say, are in emerging markets. Our plant in Suzhou, China, serves both China and other emerging markets, right? So we have strong infrastructure. I would, I would suggest that that's a point of differentiation, certainly from other companies of our size anyway, to have that large emerging market infrastructure and internal infrastructure. So having that growth helps because that market. You know, people there are obviously still, you know, wanting to make sure they get diagnosed and they get access to insulin.
So some of these newer therapies that, you know, in the U.S. that we are fortunate to have, are just not available there. So injection devices, insulin tends to be bread and butter. That helps us. Secondly, with GLP-1s, our thesis has been that what GLP-1s will do in developed markets, notably the U.S., is they would maybe delay the need for insulin, but not eliminate it. And our thesis is, especially in Type 2, obviously GLP-1s are not indicated for Type 1, but in Type 2, it's... You know, you have this factor of insulin resistance that GLP-1s can help with, but also insulin secretion. And, you know, our thinking is that beta cells continue to degrade over time, and eventually people are going to need insulin, external insulin.
GLP-1s, to work effectively, will need insulin because they can help with the resistance, as I said. So with all of those factors, and because Ozempic has been around and you saw that growth rate, you know, we don't know for certain, but some of that delay in insulinization is already baked into our numbers. So you have the top of the funnel filling in. You have emerging market growth that is not affected by GLP-1s nor pumps. We have and have successfully optimized price over time, and so all of those factors have helped keep our business stable and, frankly, our margins strong.
During the second half of 2023, new GLP-1 drugs garnered a lot of headlines. Can you talk a bit more about what impact you think that GLP-1s had historically on your business, and what impact you think it might have on your business moving forward, and whether Embecta might be able to participate in this GLP-1 surge in the future?
Yeah, I mean... So, you know, I've already talked a little bit about the historical part and why I think that is. But as I think about the future, right... I mean, let's say GLP-1s are widely successful, there are generics, and to the extent that they are delivered via pens, and you know, I would again argue that pens are maybe an efficient way, just given that they can hold, you know, more than one dose, right? Maybe four doses in a pen versus single dose in an auto-injector. I mean, our pen needles are widely available in countries around the world, certainly in all the countries that would have GLP-1s, and certainly can be used.
But in addition to that, as we think about, and we've done this in some countries where generic GLP-1s are available, and we have the opportunity to either co-promote or co-package our pen needles with those generic GLP-1s. Certainly, we have sought and in some cases been able to do that. So I do think that, you know, maybe the way to think about it is, if it can be delivered via pen, then our pen needles are widely compatible with most common pen injector devices. And none of this obviously takes away from the opportunity for our patch pump, which is for the insulin-intensive population.
You mentioned that investing in growth is another one of your key strategic objectives, and yesterday you announced that you recently filed a 510(k) with the FDA related to your insulin patch pump. This product has been under development by your former parent a long time ago, and they ultimately pulled the submission from the FDA. Additionally, the insulin pump space is a crowded space with some entrenched competitors. When did you file the 510(k)? How long do you think it will take to get approval from the FDA? And what gives you confidence that you will be successful with your pump this time?
Well, there was a lot in there, Caroline, so let me take them one by one, right? So look, this product is different than the product that was developed by the former parent. The team that developed this product is different. When we did the spin, we made a number of changes in the way we approach product development. Number one, and I know it might seem routine, is we changed the structure. We put all four key groups that are required to develop a complex product like this, so that's R&D, quality, medical affairs, and regulatory, all under one leader. And that was important because all four need to work well together to develop a product like this. The second thing we did, and all those leaders that I just mentioned for these functions are new, so we brought in talent.
When I say new, they were either just before spin or after spin, and a large part of the product development team that has developed this is new to Embecta. The third thing we did, and you've seen this in our P&L, is resourced it appropriately. Our R&D spending has sort of hovered around 7%, with clearly most of that going to the patch pump. Why we think we would win is we decided to really focus our effort on the Type 2 intensive, in insulin-intensive market. This was not a pump that was developed for Type 1 and now seeking an indication for Type 2. The reservoir size I mentioned and the three-day wear is an important consideration, but so is an understanding that physicians who see Type 2s, insulin intensive, the high prescribers even, are not all endos.
There's primary care physicians in there as well. And so we thought long and hard about how do you make this pump less complex, if you will? Because the use case is materially different than the use case for a Type 1, right? I mean, even simple things like Type 1 often used by children, Type 2, mostly by adults. You know, caregivers have a lot to do with the managing of a Type 1, of a child with Type 1. And so we took all of that into account. We did a lot of market research.
You know, I do think that what we've learned over the past several years is as people with diabetes progress and they want to use a pump, you know, maybe the first choice they have to make is, "Do I want a durable pump that's gonna last for four years, that I'm gonna use for four years, or a patch pump?" And so we decided to go down the patch pump route because it's a frictionless way for us to deliver a patch pump, right? We are already heavily present in the retail pharmacy market. That's a channel we can leverage. We already have established payer contracts with more than 95% of the covered lives in the country. That's something we can leverage. And the final point I would say is, because we are focused on Type 2, right?
Type 2, from diagnosis to pump, is a long time, and a part of that time is on basal. If you're on basal, you're likely on injections. If you're on injections, you're likely using our product. So it sounds very old school, but remember, you know, people are walking away from a pharmacy with our product, and just our ability to put an insert in there about our pump and therefore allow them a way to identify themselves, is much easier for us. We don't have to go just looking in the ether for the right patients who could potentially... or at least the sort of segment of the population that could potentially be a patient for us. So for all those reasons, and frankly, look, I mean, it's 2.5 million patients. I mean, we have zero penetration there....
This expands our TAM from core injection devices now into infusion pumps, and I think we all recognize that's a growing marketplace. So for all those reasons, we think that this is a really good opportunity for us, and it's also why we've continued the development of this, knowing fully well that these are complex projects, and are committed to resourcing it to give it its best chance of success.
In addition to organic growth initiatives, during your prepared remarks, you mentioned that Embecta is interested in M&A and partnership opportunities. What types of M&A and partnerships are you interested in pursuing, and have you executed on these to date? And specifically, do you see Embecta doing any highly transformative M&A and potentially becoming more than a diabetes company?
Yeah, so, you know, while you're in the midst of separation work, I mean, there are just some practical limitations, right? We are using our parent's ERP. You can't add products to an ERP while you're separating an ERP, so there are some, just some practical limitations. So what we've done so far is really tried to take the route of we'll sign commercial partnerships, think about them as co-promotion opportunities, and we've done about five of them in different countries of the world. I would say to use that as a proof point to also sort of give you insight into our thinking, which is, we don't need a one-size-fits-all. We have enough scale in certain countries that we could find the product that's right for that market and bring it in.
Once some of these separation works are complete, they don't necessarily just need to be co-promotion opportunities. They could be distribution arrangements or something more than that. The way we think about M&A is honestly quite simple, right? We want to find products that are appropriate for the market that we are in, that can leverage one, at least one of the three strengths that we have. And those strengths simply are our ability to make high-quality, high-volume medical devices and distribute them. A retail channel, which is unusual in the med device space. And a strong, strong emerging market infrastructure, where the needs we know are different than the developed markets, and where we know that there is going to continue to be growth in the number of people with diabetes.
So that's sort of the perspective that we look at M&A. Now, with respect to sort of size and scale, the transformative question, look, we are mindful of the amount of mind share of our organization that's being spent on separation projects. We're mindful of the amount of time and effort it's taking in our technical teams on our patch pump program and just maintaining the core business. And we are—we're quite mindful of our capital structure as well, right? We ended fiscal 2023 with net leverage of about three and a half. And so while we do want to add products in the portfolio, I feel like we have the luxury of time to be choosy about what it is that we bring in, because our core business is strong, is stable, and is profitable.
Thank you. Maybe just one quick question, before we run out of time. Jake, I imagine that as a new management team on a publicly traded company, it's important to create a positive track record with the investment community. During fiscal year 2023, were you able to raise your financial guidance following each quarter of the year?
Yeah. So we were, and I think we were very pleased with our ability to raise our financial guidance following every quarter of the year. And the fact that we were able to do that, given the inflationary environment that existed, as well as the fact that we had to get through all the separation work, was really a testament to the team and to the stability of the base business. So very pleased to be able to do that in 2023.
Great. And I think that concludes today's session. Thank you, all.