Pleas`e stand by, and good morning, ladies and gentlemen. Welcome to the Teleflex second quarter 2022 earnings conference call. At this time, all participants have been placed in listen-only mode. At the end of the company's prepared remarks, we'll conduct a question-and-answer session. Please note that this conference call is being recorded and will be available on the company's website for replay shortly. Now I'll turn over to Mr. Lawrence Keusch, Vice President of Investor Relations and Strategy Development. Please go ahead.
Good morning, everyone, and welcome to the Teleflex Incorporated second quarter 2022 earnings conference call. The press release and slides to accompany this call are available on our website at teleflex.com. As a reminder, this call will be available on our website, and a replay will be available. Please refer to our press release from this morning for details on how to access the replay. Participating on today's call are Liam Kelly, Chairman, President, and Chief Executive Officer, and Thomas Powell, Executive Vice President and Chief Financial Officer. Liam and Tom will provide prepared remarks, and then we'll open the call up to Q&A. Before we begin, I would like to remind you that some of the matters discussed in the conference call will contain forward-looking statements regarding future events as outlined in our slide.
We wish to caution you that such statements are, in fact, forward-looking in nature and are subject to risks and uncertainties, and actual events or results may differ materially. The factors that could cause actual results or events to differ materially include, but are not limited to, factors referenced in our press release today, as well as our filings with the SEC, including our Form 10-K, which can be accessed on our website. During this conference call, you will hear management make statements regarding intra-quarter business performance. Management is providing this commentary to provide the investment community with additional insights concerning trends, and these disclosures may not occur in subsequent quarters. With that said, I'll now turn the call over to Liam for his remarks.
Thank you, Larry, and good morning, everyone. It's a pleasure to speak with you today. For the second quarter, Teleflex revenues were $704.5 million, a year-over-year decline of 1.3% on a reported basis and an increase of 2.3% on a constant currency basis. Adjusted earnings per share increased 1.2% year-over-year to $3.39. In reviewing the quarter, we posted solid execution across the vast majority of Teleflex, with nearly 90% of the collective business driving constant currency revenue ahead of plan. Volumes have continued to recover in the US, EMEA, and Latin America as COVID hospital admissions have declined from peak levels earlier this year. However, the revenue results were below our expectations as UroLift sales did not rebound to the levels we had anticipated.
Excluding UroLift, constant currency growth in the quarter was 4% year-over-year as the remainder of the business collectively outperformed our forecast for the quarter, albeit with some pluses and minuses across the portfolio as we navigated a dynamic environment. Moreover, when adjusting for the impact of the respiratory divestiture and UroLift, the rest of the business grew 5.2% constant currency. This solid performance continues to reflect the benefits of a diversified portfolio that has been purposefully built and is primarily targeted to the care of the critically ill patient. In the quarter, our high-growth portfolio, which includes UroLift, MANTA, hemostatic products, EZ-IO, OnControl, and QuikClot, maintained momentum across the majority of growth drivers. Although UroLift declined 13% year-over-year in the second quarter, the remainder of products in the high-growth portfolio increased in excess of 20%.
Although the second quarter presented some additional challenges, we remain confident that the environment will continue to improve over time, including for the most elective surgical procedures like UroLift. Moreover, we will continue to execute against our strategy that we articulated at the May Analyst and Investor Day. We remain focused on strong execution and funding our existing growth drivers. We will drive geographic expansion with a particular emphasis on the Asia Pacific region. Margin expansion remains an opportunity as we improve the mix of our high-growth portfolio and generate cost savings. We remain good stewards of our capital with a prioritization on internal investments to ramp our innovation engine and M&A. Our business development team is active with opportunities in scale acquisitions, late-stage technology, and tuck-ins.
We believe that the external environment for deals is improving, and we are prepared with a strong balance sheet to execute on opportunities that meet our acquisition criteria. In fact, during the second quarter, we completed a tuck-in acquisition in our interventional business and closed on a distributor-to-direct conversion early in the third quarter. Although both transactions are immaterial to Teleflex in 2022, we remain committed to continued execution of our M&A strategy. Finally, we will continue to advance our CSR and DE&I initiatives. I would call your attention to our soon-to-be-published 2021 Global Impact Report, which highlights our progress as an organization to advance our corporate social responsibility agenda. Now, let's turn to a deeper dive into our second quarter revenue results. I will begin with a review of our reportable segment revenues for the second quarter.
All growth rates that are referred to are on a constant currency basis unless otherwise noted. Americas revenues were $412.7 million, which represents a 0.3% decline year-over-year against nearly 32% growth in the year-ago period, but reflecting improving growth trends on both a two-year and three-year basis in the quarter. Surgical was the biggest contributor to growth, offset by declines in Interventional neurology. The headwind associated with the respiratory divestiture to the Americas growth was minimal in the quarter. EMEA revenues of $145.2 million increased 3.4% year-over-year. The growth was broad-based during the quarter, with anesthesia, surgical, and interventional products making notable contributions. Once again, procedure volumes strengthened year-over-year as countries across the region moved past COVID-related restrictions.
Excluding the impact of the surgery divestiture, revenues rose 6.7% year-over-year. Turning to Asia. Revenues were $76.6 million, increasing 1.8% year-over-year. Southeast Asia and Korea were strong contributors to the performance in the quarter. Growth in China was negative year-over-year due to the impact of the COVID lockdown during May and June. Excluding the impact of the surgery divestiture, Asia revenues for the second quarter rose 7.3% year-over-year. Let's now move to a discussion of our second quarter revenues by global product category. Consistent with my prior comments regarding our reportable segments, commentary on global product category growth for the second quarter will also be on a constant currency basis and ranked by the size of our business unit. Starting with vascular access.
Revenue increased 1% to $163.9 million. The performance in the quarter in part reflects the year-over-year reduction in COVID intensive care unit patients and a decline in overall intensive care unit visits. Looking forward, our category leadership in central venous catheters and midlines, along with our novel coated PICC portfolio, continue to position us for durable growth. Based on our second quarter performance, there is no change to our double-digit growth outlook for PICC in 2022 as we invest behind our differentiated portfolio. Moving to interventional. Revenue was $114.4 million, up 5.3% year-over-year against a tough comparison of 31% growth in the second quarter a year ago. We are pleased with the performance in light of the industry challenges given the contrast shortage.
For Teleflex, the contrast shortage impact was immaterial, and we see the situation continuing to improve. We remain on track to achieve high single-digit to low double-digit constant currency growth in our interventional business for 2022. For MANTA, our large bore closure device, we see approximately 50% growth on a full- year basis. Now turning to anesthesia. Revenue was $104.7 million, up 14.4% year-over-year, despite a challenging year-over-year comparison. Of our larger franchises, hemostatic products, atomization, and LMA reusable masks all contributed to growth in the second quarter, partly offset by lower sales of tracheostomy products. Hemostatic product revenue increased sequentially and exceeded expectations for the quarter. In our surgical business, revenue was $99.6 million, representing 5.9% growth year-over-year after 39% constant currency comp last year.
Among our largest product categories, instruments led the growth for the quarter. Metal and polymer ligation kits maintained growth despite the tough year-over-year comps and the COVID-related lockdown in China during the quarter. For interventional urology, revenue was $79.8 million, representing a quarter-over-quarter increase of 6.9%, but a decrease of 13.2% year over year and below our internal expectations. We did not see the recovery in the operating environment in our interventional urology business that we were expecting during the second quarter. April was somewhat softer than our plan. We saw some stabilization in May, offset by the COVID-19 impact, but finishing out the quarter, June was unexpectedly weaker and well below our expectations.
Looking at the revenue composition of UroLift, we saw year-over-year revenue declines in all sites of service during the quarter, including the hospital, ASC, and physician's office. We have identified a number of factors that contributed to the revenue performance in the quarter. First and foremost, the broad-based recovery in overall urology procedures that we had seen in our guidance did not materialize. Most investors familiar with Teleflex will be aware that urology procedures in 2021 remained below 2019 levels. We had anticipated patient visits to urology practices to improve year-over-year as we moved through 2022. However, we actually witnessed a drop in patient flow to urology in the second quarter, which impacted UroLift procedures.
In addition, while BPH remained in the top four disease states treated by urologists, higher acuity conditions that require immediate attention, such as kidney stones, blood in the urine, and prostate cancer, continued to be prioritized. Second, UroLift procedures continued to be hindered by COVID disruptions, including procedure cancellations in late May and the continuation of staffing shortages. We conducted an internal survey with just over 100 urologists responding in the second quarter. Of the respondents, over 50% indicated that they were understaffed. Third, we initiated a voluntary recall in June on certain identified lots of our UL400 UroLift System, which is the first generation UL1 device. Although immaterial to Teleflex, it created some disruption for the UroLift sales force during the second quarter as they managed the recall activities.
The UroLift issue was brought to our attention through our internal quality monitoring process, which identified the potential where, upon implant deployment, the affected devices may not properly deliver an implant. The issue is immediately obvious to the surgeon and impacts implant delivery at the time of the procedure. It has no impact on a UroLift implant once it has been properly delivered and tensioned. As a result of our root cause investigation of the issue, we have isolated an out-of-specification product tool on one production line at one facility. We otherwise remain in production for the UL400 device. We have adequate levels of inventory of unaffected products available, so we do not foresee any supply constraints associated with providing replacement products for our customers affected by the recall or in satisfying future customer orders.
To confirm, the recall has not had and is not expected to have a material impact on our consolidated financial results or operations. Importantly, the UroLift 2 System is not subject to recall due to a different manufacturing process. OEM revenues increased 17.6% year-over-year to $70 million due to strong double-digit growth across all product categories. Our order book remains well positioned as customers recognize our broad competencies with competitive capabilities across our markets. I would like to emphasize that the acquisition of HPC has been an excellent addition to the business. The integration has been completed, and we are participating in fast growth markets for thin wall interventional micro catheters to access small vessels and fine wire for sensing and ablating technology.
Finally, our other categories which incorporates sales of respiratory products not included in the divestiture to Medline, urology care, and manufacturing and supply transition agreement revenues related to the respiratory business divestiture. Second quarter other revenues declined 10.9% to $72.1 million year-over-year. The decline reflects the loss of revenue due to the divestiture of the respiratory products, partly offset by manufacturing and supply transition agreement revenues. We continue to expect all MSA revenues will phase out at the end of 2023. That completes my comments on the second quarter revenue performance. Turning to some commercial and clinical updates and starting with UroLift. With respect to our market development objective for UroLift, we were pleased with our progress during the quarter.
We continue to get excellent feedback from surgeons regarding the UroLift 2 as well as the UroLift Advanced Tissue Control for use in obstructive median lobe. We believe that the launch of the UroLift 2 and the Advanced Tissue Control will enable us to further engage with surgeons and drive utilization deeper into our labeled indications. In fact, during the second quarter, we have seen procedure growth in accounts that have converted over to the UroLift 2 that is greater than for accounts that have not yet made the switch. Based on our progress at the end of the second quarter, we are confident in our ability to convert the vast majority of our U.S. customers to UroLift 2 by the end of 2022.
In turn, we expect a 400 basis point margin expansion for interventional urology associated with the UroLift 2 conversion when our U.S. base is fully switched over. In addition, we have seen that our patient response to our direct-to-consumer program are running ahead of our plans for the first half of 2022. We were also pleased with our new surgeon training in the first half of the year. Of note, during the second quarter, we hosted our first BPH summit since the pandemic began, with over 80 physicians attending the live event. Given that recent success, we will be hosting another BPH summit in the second half of 2022. From a clinical perspective, UroLift remains differentiated from other outpatient BPH treatments, with strong clinical results, studies showing rapid symptom relief and recovery, no new sustained sexual dysfunction, and durable results.
Our review of the clinical data from recent urology meetings indicates that real-world results continue to approximate the UroLift pivotal trial with regard to retreatment rate. We recently highlighted a number of studies at the European Association of Urology annual meeting. Of note, a real-world retrospective study included patients with varying prostate sizes and morphologies across 22 international sites. A retrospective review of UroLift cases was performed after subdividing patients according to prostate size, ranging from less than 30 CCs to more than 80 CCs, and obstructive median lobe and lateral lobe obstructions. IPSS improved significantly for all volume groups at 24 months. Now turning to an update on our international expansion strategy for UroLift. We are in the early stages of a multi-year, multi-geography international market expansion, which is expected to be a meaningful driver of growth in the coming years.
The launch of UroLift in Japan, which began on April 1st, is tracking to our plan, and we are very encouraged with the results thus far. We continue to engage with key opinion leaders, and cases are continuing to ramp up. The feedback from these initial cases has been overwhelmingly positive, and we are again getting strong responses to the performance of the UroLift loops. Indeed, I recently met personally with 19 urologists during a recent visit to Japan and was very encouraged by the commentary following their initial UroLift cases. Although we consider 2022 as a building year for Japan, we remain excited about our prospects for 2023 and beyond. Japan remains an important long-term opportunity for UroLift with a $2 billion TAM, and we are excited to bring this clinically beneficial treatment to those suffering with BPH. Shifting to other international geographies.
We remain on track for our expected UroLift commercial milestones, including the launch of UroLift in China and updated reimbursement in France during the fourth quarter. Moving on to some reimbursement updates. On July 7, CMS issued its 2023 physician fee schedule proposed rule, which was in line with our expectations. CMS proposed a reduction in the conversion factor by 4.4% in 2023 as it continues the four-year phase-in associated with the 2022 final rule. We will continue our efforts to engage CMS alongside a broad number of stakeholders to remind our physicians that the cuts to reimbursement for over 600 common office-based procedures will result in migration to higher-cost sites of service and limit options for senior citizens in the United States. CMS also issued its 2023 outpatient prospective payment system proposed rule, which was published on July 15.
In this case, the facility fee was increased by an average of 2% in the ASC and 3% in the hospital outpatient setting. These rules are open for public comment through September 2022 and do not come into effect until 2023. Considering the proposed changes to the 2023 physician fee schedule and OPPS, UroLift continues to be the most profitable minimally invasive treatment option for BPH that does not require an overnight stay in the hospital. Turning to our interventional business. We announced the MANTA Ultra Study in June. This study, which is expected to enroll up to 150 patients in 15 investigational sites, is intended to demonstrate the safety of MANTA ultrasound-guided closure with no dependence on pre-procedural depth location measurements.
As noted in our press release announcing the study, the occurrence of access site complications is known to be associated with higher rates of morbidity and mortality and increased costs associated with prolonged length of stay. In addition, we received Health Canada approval for MANTA in May, which will help us continue to build momentum for our large bore closure device globally. That completes my prepared remarks. Now I would like to turn the call over to Tom for a more detailed review of our second quarter financial results. Tom?
Thanks, Liam, and good morning. Given the previous discussion of the company's revenue performance, I'll begin with margin. For the quarter, Adjusted Gross Margin totaled 59.6%, a 30 basis point decrease versus the prior year period. The year-over-year decrease was a result of volume and mix, incremental inflation in freight, raw materials, and labor, partly offset by favorable pricing. Of note, our price strategy continued to gain traction through the second quarter. Adjusted operating margin was 27.5% in the second quarter. The 70 basis point year-over-year decline was the result of the lower gross margin, lower leverage across our expense base, and planned investment in the business for our growth driver. Net interest expense totaled $11.2 million in the second quarter, a decrease from $15.9 million in the prior year period.
The year-over-year decrease in net interest expense reflects savings from the early redemption of the 2025-year notes and the impact of reductions of outstanding debt using proceeds of the respiratory divestiture and operating cash flows. Our Adjusted Tax Rate for the second quarter of 2022 was 12% compared to 14.4% in the prior year period. The year-over-year decrease in Adjusted Tax Rate is primarily due to further enhancements in tax efficiencies of our global structure, partly offset by tax expense arising from the new provision of the U.S. tax law requiring the capitalization of certain R&D expenses. At the bottom line, second quarter adjusted earnings per share was $3.39, or an increase of 1.2% versus prior year.
Normalizing for foreign exchange, incremental inflation, and the respiratory divestiture implies underlying Adjusted EPS growth in the low double-digit range year-over-year. Turning to select balance sheet and cash flow highlights. Cash flow from operations in the first half was $101.9 million, compared to $265.1 million in the prior year period. The decrease was primarily attributable to higher tax payments and unfavorable changes in working capital, driven by higher payable and benefit-related payments. Also impacting cash flow was an increase in our inventory level to provide support for future growth and to minimize the potential impact from the supply chain disruption. Moving to the balance sheet. Our financial position remains healthy.
At the end of the second quarter, our cash balance was $208.1 million as compared to $445.1 million at the end of 2021. Reduction in cash on hand is due to $135.5 million payment in the second quarter to reduce our revolver borrowing. Subsequent to the debt payment, our floating rate debt now accounts for 42% of the total debt outstanding. Net leverage at quarter end was approximately 1.8 x, which remains well below our 4.5 x covenant. Now moving on to our 2022 guidance. We are reducing our 2022 constant currency revenue growth guidance to 3.25%-4.25% versus 4%-5.5% previously.
Revised constant currency revenue range represents a $21 million-$35 million reduction versus our prior range or $28 million at the midpoint. This contemplates a reduction in our outlook for UroLift revenue, partially offset by strength in the remaining businesses. When including the impact of the respiratory divestiture and normalizing for one less shipping day, the underlying growth projection of the business remains over 5% year-over-year when considering the midpoint of our 2022 constant currency revenue growth guidance. On foreign exchange, the dollar has seen meaningful strengthening through the second quarter, including the euro exchange rate where we are most exposed. Our annual guidance for 2022 assumed a dollar-to-euro exchange rate of 1.12 for the year. Our guidance now assumes an average euro exchange rate of 1.05 for the full- year 2022, with parity for the second half.
Our guidance now also assumes that other exchange rates have been adjusted to reflect the current rate environment. Revised foreign exchange assumptions represents an additional $55 million headwind to reported revenue. For the year, the expected impact of foreign exchange is now a revenue headwind of approximately 3.7% or $100 million versus 1.7% and $45 million previously. We now expect reported revenue growth of -0.45% to +0.55% in 2022, implying a dollar range of $2.797 billion-$2.825 billion. I will now turn to our outlook for UroLift.
Given the first half result and our expectation for sequential revenue increases in the second half of the year, we are now assuming that 2022 UroLift revenue will be down slightly year- over- year or approximately $335 million versus the prior guidance for 15% growth. This revised assumption reflects a $58 million reduction in UroLift revenue compared to what our prior guidance range had assumed. As we look into the second half of 2022, we expect an improving environment for UroLift if the macro environment improves, utilization picks up, and new exchange surgeons ramp up. Of note, our current UroLift revenue outlook for 2022 assumes growth in the second half with sequential revenue increase in the third quarter and a further sequential increase in the fourth quarter.
We have not made any changes in assumptions for the international UroLift outlook as we remain on track with our rollout in Japan and initial launch in China and a reimbursement update in France. Turning to the middle of the income statement. We expect gross margin of 59%-59.5% for 2022. Although freight and labor inflation remain largely in line with our expectations, raw material costs are turning out to be higher than previously projected. Accordingly, we are now projecting an inflation headwind in 2022 of 100 basis points versus 70 basis points previously. Recall, this is over and above what we typically see for inflation in any given year. Our outlook captures our view for the remainder of the year and does not assume any significant improvement in overall material inflation.
Importantly, price remains an inflation offset, and we are confident in our ability to achieve at least 50 basis points in price for the year. As a matter of course, we will continue to assess our global pricing and make adjustments as opportunities arise. Relative to operating margin, we now expect operating margin to fall within a range of 26.75%-27.25%. Our guidance reflects the anticipated growth margin and lower leverage across our operating expense base.
Leading to earnings, we are reducing our adjusted earnings per share guidance for 2022 to $13-$13.40 from a previous range of $13.70-$14.30, which amounts to a 2.5% decline at the low end and a 0.5-point increase year-over-year at the high end. In bridging from our previous Adjusted EPS guidance, we note a $0.60 reduction associated with our revised outlook for UroLift. Foreign exchange is now a headwind of $0.46 versus the prior assumption of $0.20. Incremental inflation is now a headwind of $0.47 versus $0.33 previously due to the increased raw material cost. The additional headwinds are partially offset by improved operational outlook for other areas of our business.
At this point, our guidance includes a headwind for the respiratory divestiture of $0.15. Normalizing for incremental inflation, foreign exchange, and the respiratory divestiture implies underlying Adjusted EPS growth at the midpoint of guidance in the high single-digit range year-over-year for 2022, and reflects the benefits of our diverse group of products and ability to grow earnings in a period of significant macro challenge. That concludes my prepared remarks. I'd now like to turn it back to Liam for closing comments.
Thank you, Tom. In closing, I will highlight our three key takeaways for the second quarter and our 2022 outlook. First, our diversified product portfolio enabled Teleflex to deliver constant currency growth of 2.3% in the second quarter, despite meaningful macroeconomic headwinds. Moreover, when adjusting for the headwind from the respiratory divestiture, the underlying business growth was 3.5%. Second, we will continue to effectively manage the business and look for ways to minimize incremental headwinds from inflation and supply chain challenges. While the near-term UroLift revenue results are disappointing, our guidance implies an improving growth trajectory in the second half of the year. Moreover, we are well positioned when the macro headwinds for the urology market abate. Third, we continue to execute against our long-term growth strategy.
We will continue to incrementally invest in our high-growth portfolio and drive dependable expansion in our durable core portfolio. We have levers in place to drive further expansion in our margins, and our balance sheet is in a solid position with leverage at 1.8 x, providing ample financial flexibility for our capital allocation priorities, including mergers and acquisitions. That concludes my prepared remarks. Now I would like to turn the call back to the operator for Q&A.
Thank you. If you would like to ask a question, please press star one on your telephone keypad. If you're using a speakerphone, make sure your mute function is turned off to allow your signal to reach our equipment. We do ask that you limit yourself to one question and a follow-up. If you would like to ask additional questions, we invite you to add yourself to the queue again by pressing star one. Our first question will come from Cecilia Furlong from Morgan Stanley. Please go ahead.
Great. Good morning, and thank you for taking the questions. Liam, I did want to start with UroLift and really looking to just get a bit more color in terms of how you're thinking about the back half, the revised guidance, but either contributions from backlog coming back in, either ramping volumes under your prior high volume utilizers, DTC, just kind of a balance of how you're thinking about the environment. Really also just your longer-term view on that 15% growth for the overall business, how you're thinking about potential backlog recapture in 2022 and beyond.
Okay, Cecilia. Let's start with the full- year outlook for UroLift. Obviously, our prior guidance assumed 15% growth, which would have revenue of $393 million. Due to the current market environment that I went through in my prepared remarks, we are now expecting $335 million, representing a reduction of $58 million or approximately 2% for Teleflex in our entirety. I would like to point out, before I get into the pieces of UroLift, that our constant currency call down at the midpoint is 1%, which is an indication that the rest of the portfolio is outperforming by approximately $30 million.
Point out that a good portion of this outperformance is coming from the high growth, high-margin portfolios such as hemostats, intraosseous and PICCs and the like. The UroLift updated guidance, to answer your question, is not assuming any significant improvement in the operating environment. Essentially, we are taking our quarter two revenue run rate and assuming sequential improvement into Q3 and further sequential improvement into Q4. This would obviously imply positive growth in the back half of 2022. I would like to point out as well that the updated guidance for UroLift is based on slower urology procedural recovery trends in the U.S. Our assumptions for OUS have not changed in that regard.
Regarding the backlog, we are not assuming that there is a backlog that will come back in the latter half of the year. I think our observation is that the UroLift procedure is still a very postponable procedure, and there's a reluctance of patients still to come back to the urologists. There's also a staffing shortage as I went through in my prepared remarks. That's our assumptions in the back half, Cecilia, for UroLift and an update on the call down for the full year.
Great. Thank you. Our next question comes from Jayson Bedford from Raymond James. Please go ahead, Jayson.
Good morning. Can you hear me okay?
Yeah, we can hear you, Jayson. Thank you.
Maybe just a follow-up question on UroLift. I think you mentioned in the script that you're seeing better utilization in those accounts who are using UL2. I'm just, you know, there's a lot of reasons for that, but I'm wondering what initiatives have you put in place to maybe accelerate conversion to UL2?
Jayson, we're very pleased with the rate of conversion that we're seeing right now. We are actually slightly ahead of our plan, our internal plan that we laid out at the beginning of the year. What we're seeing is that when surgeons move over to the UL2, it's also an opportunity for us to introduce the advanced tissue control, and the combination of those two new products is actually driving greater throughput in those practices.
It's a combination of the sales force re-engaging with the surgeon, and it's also a combination of expanding the size and complexity of prostates the surgeon is willing to treat because the outcomes on the UL2 are actually better than the UL1, and obviously, they're feeling much more comfortable doing median lobes with the advanced tissue control. We're ahead of our plan, and we do envision having the bulk of the North American, the US market converted by the end of this year. That will also result, obviously, in that 400 basis points in margin expansion for the UroLift product.
Right. Just broadly, Liam, has the UroLift strategy changed at all over the last six months? Meaning you came out with a newer strategy at the beginning of the year. Obviously, it's been a bit slower. Has the strategy been tweaked at all?
The strategy is as it was, because it is working, insofar as we did see sequential improvement from Q1 to Q2. UroLift actually grew 7% quarter-over-quarter. We have to bear in mind they had a really tough comp in the prior year. It grew over 120% in the prior year. It was below our expectations, but what we're seeing with physicians is that they are actually the new docs that are trained, we're actually seeing an improvement in the cases per physician from the new docs trained. We've also brought on a larger number of high volume docs within quarter two.
Therefore, that's what gives us the encouragement for the sequential improvement in Q3 and the further sequential improvement in Q4, Jayson.
Our next question comes from Matthew O'Brien from Piper Sandler. Please go ahead.
Morning. Thanks for taking my questions. Just to continue along the UroLift questioning, and I'll ask those questions up front. Liam, you know, going down $60 million for the year, roughly for UroLift, how much of that is just the volume impact that you're seeing on the, you know, on the folks going into urologists versus, you know, maybe losing a few people because of the recall or competitive launches versus, reimbursement headwinds? Just to be, you know, the second question, just to put a finer point on it, can you still grow UroLift 15%, you know, in 2023, 2024, and 2025, like you mentioned at the Analyst Day? Thanks.
Okay. There's a lot in that question. We don't believe the reimbursement is having an impact. We know that it's not competitive pressures that's having an impact. The impact of the recall was pretty minimal, Matt. There was some sales force disruption. We did have to swap out some product from the customer and get new product in there and get the comp so that there was that disruption.
I will tell you when I look at the performance of the UroLift in the year, I will tell you that what we are seeing is a drop-off in patient throughput and in-person visits to urologists in Q2 versus Q2 last year, and that's compounding the drop that we saw in 2021 versus 2019. We're also experiencing staffing shortages. We did an internal survey of over 100 urologists, and over 50% of them cited staffing shortages within their practices. That is a compounding issue. We firmly believe that the end market conditions is what's driving the volatility out there. As I said to Cecilia, our observation is this is a very postponable procedure.
You're not going to die because you didn't have your BPH treated. Regarding the longer term and your question regarding the LRP, just to level set everybody, the LRP assumed a CAGR of 6%-7% for Teleflex and a 15% CAGR for UroLift. Using 2022 as the jump off, and I think that's an important point to reflect on. I remain confident in the plans we outlined during our Investor Day. Ex UroLift and the respiratory divestiture, our durable core grew 4% in Q2. If you look at Q2, ex UroLift, our actual growth accelerated. Again, if you exclude the respiratory divestiture, we went from 4.5% in Q1 to 5.2% in Q2.
The rest of the 90% of the business is performing very well. Now while UroLift did decline in Q2, I think Teleflex, we are very well positioned when the BPH market recovers. Our sales force is fully staffed and prepared for the market recovery. The market is still massive. There's the US market is $6 billion and another $6 billion overseas. We have the market-leading minimally invasive technology, immediate improvement, no sexual dysfunction, no need to wear a catheter. And as I said in my prepared remarks, we expect sequential improvement in Q3, further sequential in Q4, and this will obviously help our run rate into 2023.
Even though we didn't change our guidance in the year for the international markets, we are continuing with our international expansion. Japan is going very well. China and France should kick in in Q4. We should get reimbursement in France in Q4. Italy and Spain, we continue to seed the markets region by region. In 2023, 2024, you'll see Germany, Taiwan, India, and we should get Brazil reimbursement at the back end of 2024. That's why I feel confident in the overall LRP we laid out and obviously the CAGR for UroLift in that LRP.
Our next question comes from Shagun Singh from RBC Capital Markets. Please go ahead.
Thank you so much for taking the questions. Liam, Tom, I know it's early, but could you provide some color beyond 2022? UroLift has been a major growth driver for you guys. It's part of the thesis that gets you to your target of 6%-7%. You know, how concerned are you of an economic slowdown and the impact on that business? You know, how are you thinking about M&A to further boost or, you know, even maintain this growth trajectory longer term? If I could just ask a question on the macro items, FX and inflation, what have you assumed, what impact does it have on EPS, in 2022, and how much of it flows through into 2023? Thank you for taking the questions.
Okay. I'll ask Tom to answer the FX and inflation. I'll take the couple of macro questions. In relation to if we enter into a recession, I think that Teleflex is well positioned. No industry is immune to a recession and the impact, but I think medical devices in general have been cushioned from the impact of a recession. I think Teleflex in particular will be even more cushioned than other types of medical device company. The reason I say that is that Teleflex, our whole portfolio is skewed towards the elderly population. Normally, when you go into it, if you look at the last recession, and if you look at unemployment rates, and the reason I'm citing unemployment rates is because it impacts insurance for those individuals.
If you look at the last recession, unemployment went up to about 11%. If you look at the demographics, if those over the age of 55, unemployment was about 7%, and it was double that for those under the age of 55. Because our portfolio is skewed towards that population, I think we would be, somewhat, not completely insulated, but somewhat protected, from a recession. Regarding that question specific to UroLift, with 12 million men in the United States suffering from BPH and 100 million globally, there's enough of a patient population there to continue to grow UroLift even in that type of an environment. Regarding your question on M&A in the current environment, obviously interest rates have gone up, so, the cost of funding has increased.
I do think, though, that the environment is more receptive to more appropriate valuations right now than it has been at any time in the past. As I said in my prepared remarks, we are active out there right now. We feel good about the environment. Our leverage is 1.8 x, so we have firepower. We are chasing assets at the moment. We are looking at scale transactions, tuck-in transactions. As you heard in my prepared remarks, we announced a late-stage technology in a distributor-to-direct. Not that material for Teleflex, but nonetheless an indication that we're active out there in the market looking at M&A in this current environment. I'll ask Tom to answer the FX and inflation questions if you don't mind, Tom.
Absolutely. On the FX front first, so the impact for the year right now is to re duce our revenue by approximately $100 million. We had previously expected to be a $45 million impact. You've got an incremental $55 million, as we think about rates where they currently are as of, you know, this week. On the earnings impact from FX, that's up to $0.46 for the full- year. It was $0.20 previously. As we think about next year, obviously, I'm not able to estimate what currencies will be at come early next year. Assuming they're at the same level as they are today, what we'd see is a little bit of an incremental impact, because the first quarter was stronger and the second quarter was stronger than where they are today.
You know, again, we'll have to wait and see what currencies do next year to answer that question. On the incremental inflation, we're now expecting inflationary impact of $0.47 to earnings versus $0.33 previously. That's largely due to raw material inflation continuing to increase. We're actually seeing, you know, some stabilization in some of the logistics and sea freight. You know, encouraging sign there.
Our next question comes from Matthew Mishan from KeyBanc. Please go ahead.
Oh, excellent, thank you for taking the questions. I got two just to shake it up a little bit off of UroLift. First, just what snaps back in interventional for the second half to get you to double-digit, high single-digit, double-digit growth for the year?
On interventional, you are correct. It's an accelerating back half of the year. Obviously, one of the contributors to that is MANTA. As we said, we expect MANTA to grow in around that 50% mark and will drive a significant proportion of the growth. We also have some supply chain disruption for some of our products in the second quarter that will flush out in the back half of the year. The Langston product is returning to the market also in the back half of the year, which drives that acceleration.
There's a little bit of comp year-over-year that helps as well, Matt, but we're confident that interventional access will get to high single digits, low double digits in the back half of the year from a revenue perspective.
Okay. Excellent. On free cash flow, Tom, you were walking through some of the moving pieces of the first half, and I think everyone's been talking about the higher working capital. You know, as you think about the full- year, how should we be thinking about full- year expectations for free cash flow at this point?
Well, for the full- year right now, cash flow from operations is in the $400-$450 range, with CapEx in the $75 million-$80 million range. You know, some of the things that impacted the first quarter and first half will also play out in the full- year as to, you know, why it isn't as strong as last year. An incremental tax payment this year that's actually recouped over the next two years is pretty significant. Then also some of the changes in working capital, where, you know, we've taken up inventories to make certain we've got adequate supply to provide a buffer against, supply chain, disruptions. We also had a really strong, AR collection last year that's not expected to reoccur this year.
It was right at the end of last year that we don't expect to reoccur. Venice also mentioned there's increased compensation related to payroll. Just the payouts in early 2021 were depressed given 2020's, you know, performance. You know, we're back to a normalized level of payout for this year. Those are some of the big drivers as to, you know, why the cash flow isn't as strong this year as it had been previously.
Our next question comes from Mike Polark from Wolfe Research. Please go ahead.
Hey, good morning. Thank you for taking the questions. Two quick follow-ups, UroLift, and then one bigger picture question, if I may. Just the recall, was it fully sorted exiting June, or is there a tail to complete July, August? And then July, any, you know, would you hazard a comment on UroLift volume thus far in July? And then the broader question is just, you know, you made a comment or two about, you know, favorable benefits so far from certain pricing actions. Can you just remind us broadly across the portfolio, what you're doing there? Order of magnitude, you know, what kind of benefit are you driving towards and, you know, what's kind of the over what time horizon might, you know, those benefits start to manifest the numbers?
Thank you so much for taking the questions.
Okay. I'll start with pricing. When we laid out our plan, our pricing was gonna be 50 basis points. We will be at least at 50 basis points on the year. We're ahead of that target as I sit here today. The areas where we take price, our surgical business is doing well, our vascular business has been performing well, and also our anesthesia business has been driving some of that pricing. Regarding the recall, yeah, the recall is fully behind us in the quarter. We took all of the reserves for the inventory. We took back in quarter two, and it's all reflected in our financial results already.
Regarding your question on future UroLift growth in the quarter and what's happening in July, I don't want to get specifically into July, but it is reflected on what I said. We're expecting sequential improvement in Q3 and then further sequential improvement in Q4. That's the indication that we have right now.
Our next question comes from Craig Bijou from BofA Securities . Please go ahead.
Thanks guys for taking the questions. I have one on your list and then a follow-up on margins. At the Analyst Day end of May, you guys still seem pretty confident. I apologize for asking such a granular question. Liam, I know you provided a little bit of detail on the monthly performance. I mean, how did June sequentially compare to May? You know, it seems if you guys felt pretty strong at the Analyst Day, and then, you know, there's a decent sized miss here. I understand you didn't get the expected revenue in June from UroLift. I was hoping just to maybe we'll understand a little bit about the sequential growth within the quarter, if you would.
No, absolutely. Just to level set, we were off the quarter by around $14 million. When we gave our guidance at the beginning of the year, and you're right, we reaffirmed it at the Analyst Day in quarter two, we did anticipate an improving environment from April to June. April was slightly below our plan. You know, May did improve despite COVID cancellations within the month of May. We did not see the expected improvement in June. June was not a good month for UroLift, to be fair. In actual fact, June was worse than either of the two months and decelerated. We did get a little bit of an impact from the recall, just sales time, from the recall.
I think the more significant factors were the ones that I pointed to, in-person visits to urologists dropping year-over-year and staffing shortages within urology practices, so they're not able to see the throughput of patients. I mean, urologists in our survey, and it was done during the quarter, so it was reflective of that COVID environment. They all quote "cancellations from patients due to COVID." Either the patient had it or they were close contacts as they went through. It's a fair question, and for sure, June was much worse than the other two months.
Great. Thanks, Liam. Just thinking about margins, really on 2023 or going forward, and I know you're not gonna provide guidance. But given some of the pressures that are bringing down margins this year, the lower just nominal amount of UroLift revenue this year, you know, how should we think about your ability to expand margins, looking ahead into 2023?
I might ask Tom to cover that, if you don't mind, Tom.
Conceptually, you know, as we think about moving forward, there are a couple of things that will drive margin in the future. You know, one is clearly mix. And as we've spoken about our high-growth portfolio of products, also our higher margin products. So as those continue to grow, they will provide, you know, a nice mixed benefit, as they represent disproportionate amount of growth in the business. And obviously, you know, UroLift, we need to get UroLift back and growing to help us achieve everything that we wanted to achieve at the Analyst Day guidance. I would say that, as we look at some of the other drivers, we've got restructuring programs out there that, you know, based on, you know, what we've currently announced and are active on.
We've got about $45 million of savings left to be realized there. We also have a number of cost improvement initiatives that go on every year within the plants, distribution centers, et cetera, that drive meaningful amounts of productivity. You know, a lot of Six Sigma type of work. Those are, you know, the key drivers for us. You know, as we think about the guidance we had provided at the Analyst Day, we'd assumed an inflationary environment continues throughout the LRP timeframe, although not quite to the same level of this year. You know, we had assumed that there would be inflationary pressures going forward, and that's still our belief right now based on what we're seeing.
The next question comes from Richard Newitter from Truist. Please go ahead.
Hi. Thanks for taking the questions. Just going back to UroLift for a minute. I'm just curious if I totally appreciate the, you know, that it's mostly the underlying environment. Office visits aren't kind of back to where you needed them to be, staffing shortages, maybe a little bit of recall impact. But is there anything else that you guys are picking up in the field with respect to, you know, potential share shifting to other types of minimally invasive or even more invasive types of procedures? Is there anything going on there and anything with respect to retreatment rates and changes in views on the way doctors are kind of viewing even more traditional types of surgical approaches? Thanks.
Yeah. Starting with the treatment rates, you know, the Kaplan-Meier study, which was a 35,000 patient retrospective study, clearly demonstrated that revision rates for UroLift were very similar to TURP and were well below the revision rates for other technologies that are out there in the marketplace. With regard to share shift, no, Richard, is the plain and honest answer. We haven't seen any share shift in the marketplace. We've analyzed all of the accounts within that do business with UroLift and Teleflex, and we have not seen share shift within our existing accounts. We firmly believe that it is end market dynamics that are having the impact on UroLift and the postponable nature of the procedure.
Yeah, I think that's. That would be the answer.
Okay. Fair enough. Got it.
Our next question comes from Mike Matson from Needham. Please go ahead, Mike.
Yeah, thanks. I have two questions. I'll just ask them both. You know, first on UroLift. I mean, the DTC. I mean, you keep talking about these metrics and you know running ahead of expectations and so forth. I mean, I guess I'm just wondering. We're almost a year into this now. I mean, what's happening to these patients? I mean, shouldn't the ultimate measure or metric here be the procedure growth? I mean, which is negative. You know, are these patients just not scheduling with their urologists yet? Or are the urologists turning them down because they're too busy doing other procedures or something? Then my second question is not on UroLift, but just on Vascular Access. You saw slower growth, and you called out some factors there that caused that.
I'm just wondering if that, you know, would potentially continue, you know, beyond the second quarter? Thanks.
Yeah, Mike, thank you. With regard to DTC, yeah, we're very pleased with the performance of DTC. At the half-year stage, we're ahead of all of our metrics regarding patients that we're sending on to urologists through all the different media. We do know from our survey, it is taking urologists much longer to schedule these patients. That timeframe has elongated. We see the role of DTC is to make men aware that UroLift exists and to move those men onto the care of the urologist so that the procedure can get done. You are correct. The ultimate measure should be the patient flow and volume. Unfortunately in the current environment, patient flow in to urologists is down.
The capacity of urologists to do these procedures because of staffing shortages is also impacted. With regard to your question on Vascular Access. Vascular Access grew 1% in the quarter. What we saw was fewer intensive care patient visits because of COVID. This is one of the businesses that is seeing some supply chain disruption. We've got a modestly heightened backorder situation with our Vascular Access portfolio in the second quarter. We still expect it to grow mid-single digits% for the full- year, Mike.
That is all the time that we have for questions this morning. I will hand it back to Lawrence Keusch for any final remarks.
Thank you, Darius, and thank you to everyone that joined us on the call today. This concludes the Teleflex Incorporated second quarter 2022 earnings conference call.
Our conference call for today is now concluded. Thank you all for your participation. You may now disconnect.