Investor Update

May 9, 2019

Slides

Good morning, everyone. Thank you for coming. My name is Kevin King, CEO of iBriton. Think I know almost everyone in the room. I'm joined today by a couple of our colleagues. I'll go through them here as we go through the agenda. I'm going to spend a few minutes talking about the iGrillin strategy, in particular about how our platform, our single platform, is driving growth within our company. I'm going to follow-up with Karam Cardi, who's our Chief Operating Officer. He's going to talk about commercial momentum, the impact that our platform is having on our customers. We'll talk about specific customer metrics and performance metrics, talking about our sales force, etcetera. Mark Day, who's our EVP of R and D, will talk to you about DOAT, the platform that he and his team have built and the value proposition and the status relative to other products. So we're going try to leave twenty minutes, plus or minus, for Q and A. Presentation is webcast. Presentation is on our website, and the audio will be there shortly as well. I think many of you know that we participate in a large and growing market. We describe the market as a funnel. And the middle portion of the funnel is the legacy ambulatory cardiac monitoring segment. It consists of about 4,500,000 tests per year. That's referred to here as the symptomatic initial diagnosis. We have been rapidly displacing legacy holder monitors and stent monitors with our Zio XT platform over the past several years. Here at this trade show, we're launching the Zio 18 in a more full market fashion, and that addresses a population of patients that are at high risk or high acuity events. In addition, Afrikaans has been investing in clinical studies to both expand the funnel above and below the core symptomatic market. Below the symptomatic market, studies like KP RHYTHM, where we have innovated and developed the capability for detecting atrial fibrillation burden and its impact on patient care for care management is an important indicator here. I'm guessing that there are about one million patients that are in the paroxysmal AF management category that cannot be treated more accurately or more safely through the ZioHC platform. Above the symptomatic initial diagnosis market segment is the high risk asymptomatic population. Many of you are familiar with our M STOP study. Here, we are targeting patients that have high risk factors of age, diabetes, hypertension, etcetera, that are asymptomatic and with the hopes of detecting silent atrial fibrillation, putting these patients on orally coagulation therapy with the idea that we would head off potential slight treatment exteriors and things of that nature. We published the MSOP study in Tier one at ACC, and we're really happy that the results of that study thus far are showing that we are helping the health care system to create money. So the number of hospital utilizations, number of emergency room visits, etcetera, have been decreased in the population of patients that have been diagnosed through Zioxane compared to the control arm with general medical care arm. That study will report out its three year health economics impact in 2021, and we're hopeful that, that will continue to show positive results. The big backdrop for our strategy that we're talking about here, this whole notion of being both proven and complete with a single platform really stems from the problem that health care professionals are faced with today. This is this notion of overload. If you take out your phone or your computer and you Google physician burnout, you'll be inundated with a number of articles around how job dissatisfaction, how information overload, how time pressures, administrative burden to many patients are affecting the job satisfaction of health care professionals as well as the loss of control for physicians. Their ability to adopt new technology is inhibited by the workload that they have. And so we firmly believe that any new technology that comes adopted in health care has to have a lower input value. The effort to get that value out has to be lower than the value that you derive from it. And that's what we're trying to talk about here. And when we talk about being clinically proven to be better than the gold standard and operationally complete with the seamless coordination of information in and out of their systems. We'll talk about how our platform does that. We'll just talk to you about some of the measurements that we've made. It's also important to note that the majority of our customers are also at risk for clinical, financial and operational performance metrics. And so when we're selling an ambulatory cardiac monitoring service, we're not just selling the clinical value, we're selling the economic and the operational value to customers as well. The platform that we have developed consists of five layers. The first layer here on the bottom is what I refer to as our database layer. This is a proprietary cloud based repository of patient information for over 2,000,000 records here. Inside of each patient record is information about heart rhythm, activity information, symptom information, indications of abuse, financial information or personal health information, etcetera. This information is incredibly valuable to us for creating new sources of value. This is the database that we've used to derive our AF burden measurements with Kaiser and the KP RHYTHM study. And this is the database on which all of our artificial intelligence algorithms and so forth and our partnership with Sandro came from. So this is a very, very meaningful source of differentiated value for the company, and continues to grow as the company grows each year, 50% plus. The second layer of our stack here is around proprietary data analytics and reporting. This is driven by our ability to curate massive amounts of complex data for physicians into actionable reports. Again, if physicians are overloaded and pressed for time, their ability to view 40,000 pages of information per patient is not possible, can't be done by their own rules. They rely upon us securing that data for them, put that into an actual report, which is about 10 pages. That is all done through proprietary analytics and a reporting strategy. The third layer of our innovation stack here is around an information system and workflow tools that our users interface to. It's called Zero Reports, and this is a bidirectional exchange of information between iRhythm and our providers for ordering, for results reporting, for financial information, benefits, verification, interfacing to electronic medical records and so on. Before later, it's our twenty eleven evidence in the in network contracts. As you know, the economic value proposition has to be supported by contracting with payers, but we're nearly universally covered for Zio XT and well underway with Zio XT. And lastly, at the top of the stack is our patented biosensor technologies. And Mark Day will talk to us about this. These are single use wearable devices for Zio XT and AT that are worn by patients in a highly compliant, uninterrupted manner that allows us to gather this information that can then use that back into the database. So this is kind of a closed loop system, if you will, I think. The strategy for the company for the last seven plus years has to be has been on two axes. One is around being high yield or high diagnostic yield and low cost. In order to appeal to health plans, we have to meet this criteria. And here, we've mapped the cost of Medicare monitoring against diagnostic yields, and Zio is uniquely positioned in the high yield low cost category. The upper left compared to Holter monitoring and vet monitoring, We're about 3x as high in yield, and we are more expensive. But also, we know that Holter monitoring and vent monitoring have a lot of unnecessary repeat tests. We did a study a number of years ago. It was published in the Journal of Health Economics, and that showed, on average, patients used 2.4 Holter monitors before they got a diagnosis. And on average, the time of diagnosis was twenty two months. So we're rapidly improving upon that. And then relative to multiple cardiac telemetry and implantable in three quarters, while on roughly parity, few points less than Zio in diagnostic yield, they are more expensive. And over time, we have taken away from the MCT market with Zio XT, replacing some of that. And now that we have the capability for COPD as we can address that market segment. It's clear that longer uninterrupted monitoring detects more significant arrhythmias. This is proven in our 30 peer reviewed studies. Lower cost and superior outcomes versus the gold standard, again, in our studies. We've improved the change in medical management and head to head comparisons, and we've been superior for AI detection, both in the stroke indications as well as TIA. We showed this study in the past. I think it's really important because there are a lot of patch based technologies and other technologies, but none that have the full characterization capabilities of Xenome. And here, we're looking at two sides of the slide. On the left hand slide is the incidence of atrial fibrillation and other critical arrhythmias associated at the same time. So when we detect atrial fibrillation, roughly fifty percent of the time, we are also binding to enteric tachycardia, PARP positive and AV block. These have very, very significant implications for patient management, and they are derived by our ability to monitor these patients for a long period of time continuously. Likewise, interpret tachycardia about onefour of the time, forty percent. On the right hand side is the value process associated with monitoring for a long period of time. So this is the incidence of first critical arrhythmia is detected beyond seven days. And you can see these light pressure concentric with tachycardia, heart causes AV block and their frequency at which they occur beyond seven days of monitoring. So if you use a Holter monitor and you use something that's shorter, just on the diagnostic world side, these types of morphologies, if you will, will be missed. I think many of you know that we have a small operation in The United Kingdom, and this paper was published in February in the Journal of Electrophysiology, I believe, online. It was a randomized prospective study by which patients that had implantable teeth snappers wore one of three different cardiac monitors. One was an event monitor shown in the upper left. One was a Nuvo VAST monitor, which is a company out of Spain. One was the OXT. And on bottom right was the CAM monitor by Barton. In here, what you see is the R squared value for its correlation accuracy, if you will, between the ability to detect a death burden by the pacemaker compared to the various monitoring types. And in all cases, eye rhythm was nearly perfectly correlated with the pacemaker, so 0.999 R squared value versus a variety of others, where the detection lanes were equally inaccurate for overcalling as well as undercalling atrial fibrillation. Easiest way to see that is by looking at the upper left, you see the R squared line is relatively flat, but it's really the gray area where the spread around the detection rates of over coughing and under coughing occurred, and that occurred in all three of the situations. The percent failure to detect clinically relevant lithotripsy is shown on the right hand side. So Zio XT detected all clinically relevant AF events. CAM was about ten percent failure rate, NuboVest was twenty four percent failure rate and the event monitor was about forty percent failure rate. So this is really highlighting why we talk about PROVEN and the clinical evidence associated with our diagnostic accuracy of COCA. Last slide before I turn it over to Karim to talk to you about our commercial team and just the outstanding financial performance that we've had in the company. And this is all predicated on being proven and complete. Over the last, I guess, six years here, we've got a roughly 60% CAGR. And as many of you know, we reported our Q1 financial results just a few days ago at 54% growth year over year, about $47,200,000 in revenue. And our gross margins equally are expanding. We went public in 2016. Gross margin for the year were about 67%, and we're about 10 almost 10 points higher now just a few years later. And we're proud of the team and the team. With that, I'm going turn it over to Carl, who's going talk to you about our commercial momentum and also let him introduce himself here. Good morning. As you heard from Kevin, the momentum in the past few years has been tremendous on the growth side. And as we now have a higher base, the question is how do we keep this momentum? How do we sustain that growth going to The U. S. Market. So and really here, we're to talk about how the foundation of this is based on the strength of our platform and the strength of our commercial operations and service operations. So when you look back at the penetration of our market today, it's about between 12% to 15% depending on where you estimate the market to be in The U. S. And largely, we are have penetrated the smaller side of the market, the small to medium physician practices. So when you look forward and how do we maintain this momentum, we have now to look at the larger accounts in the health system, which you all know constitute the majority of the market and we'll continue actually to expand as consolidation continues. Now as I mentioned earlier, we are underpenetrated in that segment, slightly below 2%. And so we have actually outsized opportunity in that segment of the market. And we're going to talk about how we are continuing to build our platforms, so that it fits extremely well in this segment and how do we expand our commercial and service capabilities. So we are driving the adoption in this critical segment for us for the next foreseeable future. Now if you turn our attention here to this specific segment, and we have been, as I mentioned, very focused on the smaller to medium physician practices, which is normal as you try to drive early physician adoption. Now when you're looking at this specific segment, the complexity of these accounts are tremendous. You have a huge array of decision makers from service lines, directors to physician champions, head of operations, looking at the quality and performance leaders, and you have to navigate that. You also have different settings of care. Now we're not talking only about cardiology practice, we're talking about the outpatient clinics and hospitals. We're talking about the opportunities in primary care, in emergency care and in neurology. We have been very focused on the clinical adoption of our platform and obviously it is one of the critical needs. But when you look at these healthcare systems and larger accounts, first and foremost, they want to be able to drive significant patient satisfaction because it is one of the key things on which they compete. They want to bring in more patients to their systems. They want more access to timely care. One of the most important critical need that we see is they are looking obviously for operational efficiency. And most importantly, are looking at growing their cardiovascular programs. It's one of the most important programs in their system and it is one that they are trying to build and pull through more patients into it. And most importantly, you're very aware that standardization is a critical need in this health system. So they're clearly looking also for a platform that they can standardize on. So as we look at these needs, we have been reevaluating how we are going to market and how do we make sure that we continue to build a highly differentiated platform for this segment. Traditionally, and you've seen the track record here has been outstanding. We've been able to penetrate the small practices by driving a very strong differentiation on the clinical needs. And we just talked about the clinical studies that allow us to do that. We're now really focusing on making sure that we're significantly strengthening our approach to these large accounts. We're building more capabilities on top of the existing stack that Kevin just mentioned. We're building strong service capabilities around customer service, billing, EHR capabilities. And now we have, with these combined capabilities, we have a platform that we can go and sell at the enterprise level. This is a much bigger team sport. This is not just salespeople. This is the entire company that is focused on doing this type of platform sale. One of the most important thing is that here, the game is really to drive success for our customers. This is not just clinical adoption. This is actually driving real outcomes for our customer so that it drives stickiness and loyalty, and we can continue to build penetration and adoption of our platform. So I think the best way probably to illustrate this is to give you an example of how we're doing this at an account here in The U. S. This is an actual example. It's anonymized, but it's a great example of how we're able to partner with a customer to help them drive significant improvements on their key outcomes and obviously drive adoption. Now in this specific case, we have been able to drive significant improvement in the time that they spend per patient for their staff. So it's a 3x reduction. We most importantly, we've driven significant reduction in the patient wait time and turnaround between the time of order to when the report is ready for these patients. And finally, the cost per device, and this is really around labor cost, is divided by almost four times. Now this obviously leads to a significant improvement in profitability. In this specific case, we actually help the customer go from a loss position to a significant profit position. When you look at the specific case, there's two big insights that comes from this example. One is customers in this case had very significant pain points with their existing workflow technology they were using. Some of it, they were aware of it. Some of it, they were not. And our approach has helped them uncover the real issues with their health systems and in turn has allowed us to have a stronger partnership and a stronger dialogue. Now in this case, as you know, the standard of care in The U. S. Today is Holter, so we're talking about an improvement moving from Holter to our platform. But just to give you some insights on understanding how severe the issues are with the Holters, some of the wait times that we have seen and some of the backlogs are we're talking about few months that patients are waiting for getting into the hospital and being able to be monitored. Now there's huge variation, but the improvement is not only in the ability to get them in a shorter time, it's also the consistency. So we significantly reduced the variation and we produce a reliable service that allows them to consistently work with their patients and get them access to timely care. Now when the customer wins, we win. And obviously, this is the type of penetration we have been able to drive in this specific account. This was an account actually that had originally adopted our platform, but just with few physicians. As we started to uncover their issues and their pain points and we show them how to potentially significantly improve their operations by standardizing our own platform and significantly increase volume level in a fairly rapid time. As you can see also, this increase is consistent over time, which actually is another proof of the consistency and the reliability of our service. Now I want to reiterate one of the key tenets here of our ability to drive this type of penetration and this type of adoption in accounts is the power of our platform. First of all, it's extremely easy to use. It's extremely helpful for all of our users to connect to our platforms, whether it's technologists, service line directors, physicians, extremely easy to use. The second is it has strong appeal to every users. So as whether we're talking to the technologists or the physicians or the administrators, it has a very strong appeal, whether it's clinical, operational or financial. And finally, it creates significant value for them as a whole. This platform connects all of them and is enabling them to create not only value financially, but significantly expand their cardiovascular program by pooling more patients and being able to treat more patients. And this now monitoring was viewed as a roadblock and now it is viewed as a gateway to help them grow their cardiovascular programs. Now this is an example of an account in which we had initial penetration. Let me tell you a little bit more about new accounts. And we've been sharing with you this with you consistently on how fast we're able to ramp new accounts over the past few years. And as recently as in January, we shared with you that that threshold was about three months to get to a volume of fifteen months. Now as we have ramped up our capabilities on the platform and our commercial and service capability, we are able now to reach that volume in less than a month from the time we activate the service with these accounts. Now this is obviously significant investment in our platform capabilities that not only is based on the technology stack that we've just seen, but our service stack, which is extremely important to be able to drive that consistent delivery and reliable service, but most importantly, a very strong onboarding experience for our customers. So this is obviously a key tenet of the company's strategy to expand our commercial footprint and our service footprint. We are on track with our goal that we shared with you as recently as a couple of days ago. But importantly here, as we are adopting this new model and driving this platform approach with our customers, we are more and more focusing on hiring and capabilities and will allow us to continue to drive this adoption in this very large segment in The U. S, which has tremendous potential and in which, I would say, early success and good momentum proves that we're on the right track. We have already invested in training programs that actually allows our commercial teams to tap into this approach. We have already implemented that training in our first quarter with a lot of, I would say, success. The buy in of our commercial team is very strong, and we're able actually not only to drive this with new hires, obviously, that bring this type of skill set, but as you heard, the productivity of our tenure ramp is also improving because they are adopting this approach. So we are building a very strong confidence in our capabilities now to continue to drive penetration and most importantly make the Xeo platform the new center of care for migraine. Now we talked about the power of the platform and Mark Day is going to help you now understand how we're completing that platform and make it even more powerful for our customers. Well, good morning, and thank you, Karim, for that introduction. It's my pleasure this morning to give you a bit more of an introduction into what we're doing in a new space for us in terms of how we've approached the NCT opportunity. So I want to share a little bit about what our platform looks like now and how we've built the Zio AT device to complete the offering in order to enable accounts to essentially get the whole platform from iRail for their needs. The first thing that will strike you is that the XT and AT form factors are identical. Indeed, this is a video AT patch, exactly the same form factor, exactly the same application process, very familiar reporting platforms, workflow tools to the XT device. And in a sense, this is very important to us because it addresses what Kevin spoke about earlier as a predominant need that we see in the marketplace. We need services and capabilities that are easy to use and less than training for accounts. And this is exactly our strategy of putting a device out there that uses the same workflow engine, the same reporting tools, the same application processes, the same interpretation methods between XT and AT, essentially reducing the burden on clinicians to learn and adopt this new capability. What we've done, in essence, is put a telemetry and algorithmic capability in a very small form factor. What we've done in terms of adding devices is to add a gateway component, which is the cellular connectivity for patients to provide and enable timely monitoring during the rare period. The convenient form factor, and I'll speak a lot about why patient compliance and a lot of our design thinking is really critical to the success of this platform. Well, let's start off with some fundamentals about how it works and what actually the service is. Really, the foundation of a timely monitoring service and a service that gives information during the wear time are the standard reports, which every patient will come through. Six hours after application, there's a baseline report. And then every day, there's a report to ensure and provide information on how the patient is progressing. The main clinical benefit, though, comes in two forms. First, symptomatic triggers that are obviously communicated when patients press the trigger button. This is very important from a physician understanding perspective. We're looking at symptom rhythm correlation here. Typically, most patients come and are prescribed a device based on the fact of symptoms that they're feeling. So understanding what rhythm they're in at that time is important, and it's important for these high acuity patients to do that in a timely manner. The main value, though, here is that we understand that so many arrhythmias and so many conditions are asymptomatic. So enabling an automatic detection platform and a timely reporting method of these alerts, these asymptomatic alerts is really the key clinical benefit of this. But here, our approach is a little bit different. What we're focused on, again, is the load of information that not just physicians but also the medical assistants, the technicians within clinics have to manage. And the way we've done this is to implement a service that only provides actionable information during the wear time. So these are alerts that people receive, and they should be taking some form of action. They could choose to monitor, but it reaches a threshold where physicians and clinicians should be looking at this information to decide what to do with the patient. The reason that we can do that and only provide actionable information during the worry time about asymptomatic events is that we have a very proven report at the back end. That's exactly what we just spent ten years developing with UofXT. In this report, we analyzed all the information that was collected during the wear time on a B2B basis, typically about 1,500,000 heartbeats over a fourteen day period. That goes into all of our AI algorithms, our clinical team, and we will review and provide that report, which has got all of the actionable information in it that we already reported on as well as all the important information that you need to see in one space, in one place, in one condensed form to really create the right management plan for patient. So in essence, we created a solution that balances the need for timely awareness of information with a complete view after the wear period of what's going on in terms of the important pieces in the full context. I spoke a little bit earlier about how we leverage the form factor of XT and put all the AT capabilities into exactly the same type of design. This is important to us for a lot of reasons, which I'll talk about, but indeed, we leverage the ST experience in other ways. Specifically, we took the 2,000,000 records that were in the database, over 500,000,000 recorded ECG, and use that data to create AI algorithms that are backing essentially the AT service and its capabilities. We developed all this actually before even we put on the first patients. With such a large database, we could take XT recordings and stimulate what it would look like on the AT side in terms of the AT hardware and ensure that we are capable of detecting all the categories that are really important to physicians, all the criteria that were actionable that I spoke about. And indeed, that was all done before we even put the first patient on service. Since that time, we've been building up the database, as Kevin spoke about, this virtuous cycle of more patients coming in, algorithms getting better. And I think a key example of this is to talk about a case of complete heart block or the condition of complete heart block, which is a very tricky and subtle and infrequent and low prevalence arrhythmia, but clinically very significant. So the need here is to develop algorithms and services that can be very compelling and provide a lot of confidence to physicians that we can detect this despite how difficult it is. And by having significant amounts of data, even at a zero point seven percent prevalence in the population, we have 200,000,000 records, there's a lot of data to work with. In essence, this is kind of how even our XT service has really powered what we do on the AT side. When we look at what's out in the market right now in terms of MCT devices, we see a lot of room and opportunity for improvement. Specifically, this has a lot to do with patient compliance and the burden that a lot of devices are putting on patients right now. This includes for a median age of 65 or older patients. This includes asking them to recharge batteries regularly, to exchange batteries, to deal with interfaces that are complicated. That's a high order of ask for a lot of patients. Our approach with Zio ET was to create something that leverages the same principles of our XT platform, simple, straightforward and highly patient compliant. So this point of patient compliance, like why are we so focused on this? And the answer also comes from our data. If we look at our database and consider how many patients have one episode, we see about ten percent of our prescriptions in terms of records that have one arrhythmia episode that could be as short as four seconds within fourteen days. Ten percent of patients account for just one episode. Just over twenty percent account for three or less. So unless you have a service and a platform that's capable of a very high patient compliance and indeed our analogs uptime is about ninety eight percent on average across our recordings, you stand a very good chance of missing such rare and frequent episodes. When I talked earlier about completion heart block, here's a perfect example of what this looks like. Here's a patient who, for the better part of eight days, was monitored with absolutely nothing wrong, absolutely healthy, normal heart rate range, normal sinus rhythm for those eight days. And then for exactly sixteen seconds on the eighth day, they had essentially lethal arrhythmia, combined for clock and pause simultaneously. And then after that was done, fortunately, they recovered, went back to the sinus rhythm for three days. Unless you have a platform that is capable of reporting continuously with that high compliance throughout that, evidence and examples and episodes like this are very easily missed. We have taken a very thoughtful approach to introducing the AT platform. We have been spending time ensuring that everything is working, that is right for us, and this includes all the way to the billing side of our operation. We've been focused very significantly on contracting with payers to ensure we can minimize customer and patient friction as we ramp up to full launch. We've also been focused significantly on adding our 24x7, Indeed three sixty five day a year kind of service capability and sharing that in scale. Part of this very thoughtful approach is listening carefully to our customers and listening to their feedback and making tweaks to the platform. This is a new service for us. So we had opportunities to do as we're doing something new and trying to be innovative with respect to our approach, asking for feedback and making minor modifications as we go. And then the last piece of this was an investment in new technology and new capabilities. Part of the LTE network that we're all using on our smartphones, but new for Internet of Things devices was introduced in 2018. We were one of the first medical devices in terms of this gateway to be certified on an LTE network. And that happened in kind of mid-twenty eighteen as the first devices were coming up. What this does is it gives us faster bandwidth and faster reporting capabilities with lower power and gives us a platform that we're going to invest into the future. So we're purchasing assets for this service that we know have a long runway because this is a brand new network. And by the way, Internet of Things network, they don't change every two years, they change about every five or eight years in essence. So what we did is we certified our hardware in 2018, about in the middle of year and then spent the rest of the year doing verification, validation, field testing, ensuring that we can introduce us with confidence. That's all behind us now. So in essence, what we're focused on now is ramping up all internal services ahead of a major ramp later this year. So to summarize, what we've seen in terms of feedback from our customers is very reflective of this single platform opportunity. They see and they communicate to us a lot of confidence that they see in terms of the accuracy of the analysis that we're providing, and they truly appreciate the patient compliance that we're providing with this platform in terms of the basis for the confidence that they've seen the report. Certainly, we also hear and see regularly the feedback that they give us on how consistent and reliable our service is. And what I'm showing on the right here is an example of how this plays out for us. This is an account that we introduced the Zio XT service to in 2016. And much like the example of Shane showed earlier, we had a few physicians providing and prescribing the device in 2016. As our efforts in terms of engagement with the account expanded throughout that year, indeed on a lot on that kind of cycle of increasing adoption that we see in accounts, we got to about 40% of the volume by the 2017. And then we introduced AT, and we provided a complete platform for the account. What we see is AT views at about the 10% to 15% range, which we think is about appropriate. Not all patients need this high acuity type of monitor with a higher burden and a higher cost. Most patients are much more appropriate to put on NexTi, but when we gave them that whole platform, we saw on the order of 85% of the volume go to this platform for their clinic and only a few Holter devices are very appropriately used for patients with very frequent symptoms. But this is exactly the power of providing a complete solution to accounts and what we are very strongly looking forward to as we ramp up the service later this year. And with that, I'll conclude and turn it back over to Kevin. Thank you. Thank you, Colin and Mark. I also want to make sure that everyone knows that Matt Garrett, our CFO, is here as well. We didn't have enough time for four presenters, but Matt is here to answer questions. We can open up to questions to the team about the presentation and so forth. We've got a microphone. If you would just state your name and where you're from, that would be helpful for us. So we'll do our best to answer questions. So the question here from Robin is how does the competitive landscape change within accounts now that we have a more complete platform? So okay to paraphrase it that way. Not having that into the pandemic. The biggest need out there is our customers have this massive burden right now because they're using the devices that have significant implications on their operations, performance, on their patient satisfaction, on their place on the clinical side with very low yield. So first and foremost, I would say the potential of the platform without AT is very, very large. As you said in the shadow of Salesforce Tower, it strikes me that enterprise selling could be different than typical enterprise selling. So I'm curious to know what, in terms of your sales management and your sales representatives you instituted in terms of hiring these kinds of people that maybe educated a little bit the difference between typical medical device sales and what you're doing now difficult for someone else to replicate. Maybe you could comment about that. Sure. Maybe I can take the second question, if you want to take the first one. For the longest time, we've been talking about the value of our servicing and our reporting capabilities and workflow and so forth. We've never really described the Zio patch, if you will, the device as the unique web as valuable as it is and as highly packaged packaged as it is and as highly compliant and valuable, it by itself is just one element of that stack. So when you have to go back and we go back and think about the problems that our customers are having, right, this burnout, these pain points, these inefficiencies in health care. In order for people to change or to adopt change, you have to do it in a way that the effort for them to adopt is less than the value that they can have. If you ask them to do more work, they're out. And a great, great example of that is not long ago, we had a physician panel, and we were discussing new reporting capabilities, some of which are shown here at HRS. And physicians were evaluating a variety of capabilities. And one physician was nodding one way or the other way as we were going. And I asked him why he was doing that. He said, Look, I can give five minutes to interpret a zero report. And some of these features are making it less time for me, I'm going to use more of it. And if any of these features are more, I'm going to use less of it. So they value their time down to the minute. And this is a big, big part, I think, what Carl was describing about our ability to appeal to their problems and helping them to create value for the patients and to spend more time, and that's what derives stickiness. And in order to do that, give you that completely vertical stack. And it's a loop it's a closed loop system, right? You can't have just one component of it. You have to have the complete component of it. And each of those components need to work seamlessly with one another and interact with one another. So it's not just the past. It's not a database. It's not an algorithm. It's not a contract. It's not a literature. It's an entire system that is valued very much in the same way that you might interact with Salesforce and its ability to affect your workflow in your commercial enterprise or in your organization. Karl, do want to talk a little bit about sales force and what we're doing different? So you're actually right, the traditional MedTech device, right? Is how So you have clients there with YCAF getting to 70% Great question, Vivian. We've talked a lot recently about our sales force productivity levels in which we increased them from 2.5 at peak to 2.5 at average over four years. And I think a lot of that is coming due to the fact that we are seeing, as you point out, significant penetration even in our most secured clients. All the statistics that we provide with prior to the same store sales comes from accounts that we've had maybe on board for seven or eight years. So the uniqueness that we're seeing, and a little bit of this is something more anecdotal and specific, the uniqueness that we're seeing is even in some of the legacy accounts, we continue to see growth, growth above what we even anticipated when we structured our forecast three or four years ago. So the way to think about this is at some point, we need to reach peak productivity in a particular brick and mortar account. What we're seeing is that what the rep thought, what our sales ops team thought or what I thought were not accurate. And the reason is because we are further penetrating ways that we never really thought before. So number one, we're going downstream into neurology with a ketogenic stroke. Number two, we're going upstream into the emergency rooms, where, again, it feels kind of stacking of all the things that we need to do to be successful. I'm not sure we just mentioned much about EHR today, but the EHR ability helps us to be able to penetrate deeper into the accounts. And the third thing that we've seen, and this is very anecdotal, but it's an intriguing feature, is there are accounts that thought they had achieved their highest level workflow in terms of the number of individual patients they can bring through in any given day in a particular clinic. And we're actually expanding that pipeline because Zio is actually improving their workflow in a way that allows them to see more patients on any given day. So indirectly, I guess I'm trying to say is it's very difficult to pinpoint exactly what maturity is in a given account because we're continuing to grow in accounts that we thought were mature. Trying to place a specific number on 80% penetrated or 90% penetrated is difficult. As Mark's presentation pointed out, there's still going to be a small percent that will ultimately still use bolters appropriately so over twenty four to forty hours. But there's no reason believe that in any of the accounts that we've gone into, particularly with these large integrated systems that we can't achieve the levels that Kevin that Mark showed up there. I think everyone, great question for me. I think by and large, health care and health care professionals are way, way behind in their ability to assess their profitability, their cost accounting, their workflow and things of that nature. And oftentimes, as Karim said, as a presentation, many of them are surprised. Most people think that their ambulatory monitoring centers, their cardiology departments are highly profitable until you actually start to measure it and you find out that they're not. And the eyes open up and go, Oh my god. And I think the comment that Matt was making as well, many of these organizations are capacity constrained. So you may have ten, fifteen, 20 monitors, but if they're on ten, fifteen, 20 patients, the next 20 that came in, they can't be serviced. And this is one of the benefits of having a single use disposable biosensor that can be deployed in all of these different departments, up to nine or 10 different locations in these large systems for hundreds of prescribers to have access to. And then all of the workflow benefits that Carmen was describing. When you add all of that stuff up, you end up with the throughput benefits, fewer unnecessary repeat tests that don't get paid for by insurance companies, fewer utilization of resources and the high The answer is yes. There's no reason to believe based upon obviously the higher price point of that device service, I should say, that we will be in that same 7% to 8% gross margin. I cautioned early on, it will take a little bit of time. There is absorption. We have a 20 fourseven service in order to support that business. So it will take a little bit of time, but we have a small drag on gross margins as we launch. However, we've made that into our guidance of the 75% to 76 figure. The major question is yes, we'll absolutely be able to achieve same level gross margin that we do with that margin Gene Mannheimer with Dougherty and Company. Please talk about maybe some of the challenges of selling something like telemetry, right, into a market that's already established with one or two large players versus VXT, in which you were effectively the pioneer and inventor of that market? Sure. So I think you have to think about it not as an individual product but as a platform. And so when you go into many accounts today, there may be as many as three to four different vendors, if you will, or companies that are servicing accounts. It could be an airport monitoring, MCT company, it could be a Holter company, it could be a vet monitoring company. And this is a big part of why there is so much difficulty for these accounts to become productive and profitable. And the real value proposition here is the single platform, and that's the differentiator for us in terms of our ability to penetrate these large accounts. The capabilities that Mark described on patient compliance and the ease of application for clinical staff cannot be understated. Mark flashed this gateway in front of you for a second here. This is a gateway that's a single use gateway. It does not need charging. It does not need interface to buy the patient. It comes automatically paired, and it's just a passive device. And these are devices that don't need service by the monitoring staff and hospitals. It's just out of the box works. So there are unique product capabilities, workflow capabilities, and I think the single product are the driving factors for differentiation there. And of course, the clinical benefits that Mark has discussed as well. and in It's very difficult to answer the question in terms of what's the productivity because we don't know based upon the example I just gave. If our we longest legacy accounts that continue to grow in double digits when we thought that they were fully saturated, that's a good problem to have. So we're not at a point of saying that we've reached peak, and I don't think that we would today, but we've obviously updated as we move forward. I think the area where we have found the biggest change since IPO, when we talk about our barriers to entry or our mode, and again, back to the staffing system, is around workflow. And we have made significant investments in the organization, whether it be customer service, whether it be toll free lines for billing support, whether it be onboarding services, whether it would be EMR, EHR integration, that is where we're starting to see real productivity scale from an OpEx perspective that has direct impact on our ability to drive further penetration and productivity with the sales rep. So the answer is that we're optimistic that we'll continue to grow. And we'll obviously update from a guidance perspective as we move forward. But I don't believe we've reached peak yet because peak keeps changing. Sure. I think the answer is yes to all of those. So both Zio XT and ADT share the same stack, same data repository, same algorithmic capabilities, same reporting structure, the same order entry, the same interfaces to electronic medical records. They have different contracts actually because they have different billing associated with them. And many of the elements of that Mark was highlighting on the wearable wireless and strong comp. When Mark told that was the AT, we're saying that we built into it the wireless capability to it, but the remainder of the platform is the same. So this a capability that's highly leveraged I think the answer is no. And if we were headed in terms of inventory consignment, things of that nature, I think that's one of the other advantages ZYO XP and AP. We as you all know, manufacturing in The United States, we have plenty of opportunity for expansion. And we've never been in a situation of having inventory shortfalls. We hear that time and time again as it relates to other products and services that are out in the field. So you can imagine, once again, to ZACI, that we were able to come in with a platform for both ZO, AT and XP, place them on the shelves from a consignment perspective, and they never have to worry about inventory shortfall. That's another huge advantage for us as an overall entity. One of the accounts that just asked and one of accounts that we referenced in the past, the larger accounts is account that has 10 locations, has 300 prescribers, and we service nine different departments. All of the prescribing, all of the order entry, all of the claims benefits, patient eligibility are all done digitally through our platform. And so we know which physicians are prescribing, when they're prescribing, we know how to deliver inventory to them to keep them at certain stocking levels. They don't place orders with us. And we maintain inventory as a flow. And this is a benefit for us and it really improves sales force productivity because sales reps are not selling inventory. We're managing all of that stuff through our information system. I think we have time for one more question. Think we've gone over. So from an R and D perspective, to ensure that the products and services that we provide build are done with a very careful eye towards usability and workflow integration with our customers. And the final thing is we're working a lot on back end lean seasonality to ensure we can continue to scale Maybe to add to that. So is it possible that we would either private label or white label our algorithms toward people? Absolutely, there's no reason for us not to derive benefit from that. I think in the long run, the value of our database will help move health care from being reactive to proactive, right, the ability to use all of that information to do predictive analytics. We see this today in some of our data where atrial activity might be a precursor to atrial fibrillation. And if you see atrial activity in a patient, can you head off atrial fibrillation in the future by treating them? So our ability to mine that data, gain meaningful insights might allow us to be more proactive than it is reactive. And the reason why I say reactive is because ninety nine percent of patients come to us are symptomatic. They already have the disease. The question is, can we uncover the disease ahead of time and help them to provide the megabev. And the more enriched our database becomes with more data, not just ECG data, rhythm, rate, heart rate, other types of clinical information, the stronger that probability becomes. Okay. I think we've sorted my last time. Thank you so much for coming. We really appreciate you getting up early to see us and your interest in our company. Thanks very much.