Treace Medical Concepts, Inc.

Q4 2022 Earnings Conference Call


spk_0: the conference will begin shortly to raise and lower your hand during
spk_1: hello and welcome to treat medical costs fourth sport quarter twenty twenty two earnings conference call at this i'm all for to space on i listen only mode after the speak of presentation there would be a question and answer session to ask the question though the session you would need to press star one one on your telephone you have been here automated message advising your hand it's raise to withdraw your question please press start what one again i will now like the him a conference over to vivian the bodies of investor relations you may begin
spk_2: but as a new never won and want to go fourth quarter twenty twenty two earnings conference call participated in the country today will be john trees she an executive officer and my chair she financial officer three to call the off a sanitarium and went later that he and movie was boy for the financial results will be secular close minded today after which will host the question and answer session especially for the family that your nation section bullets by investors that to that phone called them the court and will be unfair to be that reflection of our website it's only the when he would like to remind you that it is our intended only looking statements neither of these call the be protected under the present situation with on active ninety ninety five and statements that willing to expectations or production was a future events and market the trends but i was out and play those are the fundamentalists i saw it was your statements or for the defendants are based upon a protest against the in various assumptions a statement about digital the risks and uncertainties a could cause actual results are events to jury that that on both anticipated on find that eastern looking statements are putting up with them it's are based upon current available information and trees since no obligation to attend these statements accordingly you should not play until the lines the statements please refer to as violence including on phone ten killer at a time here twenty twenty two twenty five much age twenty twenty three for didn't tell presentation of breasts or that and now trying to call in wichita
spk_3: thank you very and good afternoon everyone and thank you for joining us on our fourth quarter twenty twenty two earnings conference call twenty twenty two with another great your of growth and execution the trees at the beginning of the year we strategically increase investment into are proven business strategies namely growing are direct been focusing on channel increasing investments into our patient awareness dtc initiative and making targeted aren't the investments in law a posse innovations as well as in are expanding sweet of complimentary products these investments resulted in strong revenue growth and fifty percent over twenty twenty one and realize continued gains in our key operating metrics or operations continue to scale through twenty twenty two ending our seasonally strong for corner with positive adjusted ebitda we are proud of the progress we've made and believe we got a strong foundation that will continue to feel our growth over the coming years before i go into details about the quarter year much start out with our market summary on where we stand today are disrupted laugh aponte solution was specifically develop the correct the root cause of the bunyan and address a large and underserved market we've identified as more five billion dollar plus us market of one point one million annual surgical candidates of which only four hundred fifty thousand and undergo bunyan surgery each year which we believe is mainly due to limitations associated with current standards of care as a the fourth quarter of twenty twenty two we penetrate approximately five point five percent of the estimated four hundred thirty thousand annual banging surgical procedures in the us up from three point eight percent in the fourth quarter twenty twenty one and reflecting approximately two point two percent market penetration and the one point one million annual us surgical candidates the constitute are five billion dollar plus total addressable market during your cue for and for your results revenue in the fourth quarter was forty nine point eight million representing forty nine percent growth over the fourth quarter twenty twenty one and with slightly above the previously announced revenue range expectation of forty nine point one to forty nine point six million during the fourth quarter we continue to benefit from our commercial strategies and investments a strong demand friends from surgeons and patience and growing salesforce productivity for the for your twenty twenty two revenue with one hundred and forty one point eight million a fifty percent increase over twenty twenty one and also slightly above the top end of our pre announced revenue expectation of one hundred forty one point two to one hundred forty one point seven million notably or revenue growth in the second half of twenty twenty two was about the growth rate we experience in the same period for twenty twenty one therefore were extremely please not only with our top line growth but authors sustained positive trends in our key operating metrics during the fourth quarter including are expanding direct been in focus they'll theme which accounted for seventy seven percent of our cue for revenue next coming in well ahead of our seventy percent target for the year strong that he increases in the number of new surgeon users and in queue for with two thousand three hundred and eighty seven active surgeons which is an increase of six hundred and four during the year of thirty four percent year over year a year over year increase in trailing twelve months surgeon utilization with an average of ten point three kids per active surgeon in queue for up from nine point eight kids a year ago and strong blended average selling prices of five thousand nine hundred and seven dollars per lap a paki gets sold the quarter representing ten percent growth over the pa i year due to steadily increasing contribution from our duct doctor posse a correction system as well as are more recently commercialize as for a at an atomic weights or speed release and are try tome tissue instruments our strategic investments and commercial focus have a lot of the successfully grow our business getting his confidence we have a well defined proven and scale bowl commercial strategy therefore as we turn to twenty twenty three we're providing for your revenue guidance of one hundred eighty seven to one hundred ninety three million which reflects an increase of thirty two percent to thirty six percent over twenty twenty two revenue we look forward to balancing aggressive execution on are proven succeeding initiative to maximize our growth and market penetration with modestly improving pretty expensive leverage given our market differentiation and large five billion dollar plus us opportunity will remain committed to our growth agenda shifting now to our commercial market development activities as discussed when they targeted investments and twenty twenty two with the goal of increasing our market penetration by expanding the footprint coverage of our bunyan focused or exhale channel advancing our patient awareness the initiative and driving more targeted rd investments into the market we have a highly specialized team a trees including a rapidly growing direct sales force one that's one hundred percent focused on bunyan and related mid foot surgery and represents the only such organization we're aware of in the med tech industry we believe this has contributed meaningfully to our revenue and market penetration in the fourth quarter seventy seven percent of our revenue was generated by or direct sales force up sequentially from seventy four percent the third quarter and up from fifty eight percent of the year ago we were happy to announce last quarter that we surpassed are previously communicated seventy percent year and target earlier than anticipated and we expect to grow to a higher makes a direct revenue over time we ended the fourth quarter with one hundred and sixty a quota carrying direct sales reps an increase of one hundred and seven percent from the eighty one direct threats that we had at the end of the year twenty twenty one given the strong interest from great candidates to join our employees sales team are also happy to announce that we succeeded our year and target one hundred and fifty quota carrying sales rep set forth at the beginning of the year we believe is the reps are joining our team because of are you need growth for a profile and culture driven by disruptive technologies that are backed by strong clinical data sets and supported by our market leading patient insurgent education programs including associate sales reps clinical specialist and sales management are employee fleet in the field increase eighty five percent to two hundred and sixty seven sales employees in the fourth quarter compared to one hundred forty four employees at the end of last year we continue to experience strong benefits from our expanded direct sales team or direct wraps typically scale with significant revenue and costs leverage achieve within twenty four months primarily because they're exclusively focus on our products and fully utilize or sweet of corporate resources and programs and twenty twenty three we plan to continue to invest in our direct sales travel to drive increase market penetration with a target of having over two hundred quota carrying direct reps by the end the twenty twenty three er patient awareness dtp initiatives are a key component of our commercial strategy remain focused on our patient awareness ttc initiatives that are designed to educate and steadily increase the number of potential patients visiting our website become educated on the benefits of lap a posse located experience lap of hi fi surgeons in their area and ultimately for these patients to schedule a consultation our investment did you he is resulting in hundreds of thousands of patients visiting our website every month and tens of thousands of patients searching for a laugh a posse surgeon in our area now with one out of for surgeons in the u s using lap a plastic we have a larger and expanding national surgeon base that can field inquiries from a higher volume of patients given this we believe the time is right to step up our dtc investments and twenty twenty three which we have initiated earlier this year the last or started education and training programs also continue be well received interest in attendance by new surgeons at our training events with strong and oversubscribed very often and twenty twenty two likewise or advanced training events both online and in person or are more tenured surgeons can acquire advanced skills and learn new approaches such as are many incision in a doctor party procedures continued the show strong started a man or education programs play a key role in the effective on boarding a new certain users and increasing the skills of our existing users broadening their peyton indications during twenty twenty two we added a record six hundred for new surgeons compared to five hundred and eight in the same period last year representing a thirty four percent increase we are encouraged to feed his continued strong growth and are certain user base as a the fourth quarter or aca certain base which includes urgency performed at least one case and the trailing twelve months has achieved approximately twenty four percent penetration of the estimated ten thousand foot and ankle surgeons who perform bunyan surgery and the u s as are certain base continues to mature we look forward to utilization games with increased years of our lap of last the and a doctor party system as well as further adoption of are growing portfolio of complimentary products all supported by are expanding direct sales channel and patient awareness btc initiatives we were pleased to see the high level of interest in attendance of new certain that are turning events and twenty twenty two it is evident that we offer a great education platform for a growing network of laugh a party surgeons and we look forward to hosting additional certain training events and twenty twenty three across the country and it on his fate of the are training facility here at our headquarters and part of eater speaking now to our product development strategy we haven't already team committed to driving innovation to maintain our industry leadership with programs for both next generation been incorrect and systems as well as the development of new complimentary technologies addressing other been related pathologies and ip defense of our technology and innovations at the end a few for me at forty grade us fans and over forty six us patent applications pending twenty twenty two with a terrific year of innovation for us following for commercialization our a doctor classes at the key to in august we announced the for commercial release of our lap a posse three and one cat guide our lap a classy as for a an atomic playing it and the speed release and tried home pc release instruments i'll still early adoption of these products has progress nicely and were terrorists by the favorable response receive from asserting community for growing portfolio been in focus technologies in february at the american college of put nickel surgeons we highlighted to new exciting product innovations namely or lot or micro laugh a classy system this is advanced instrumentation option designed to further reduce both the incision size and related tissue the section with the lap of actually procedure this evolution of our it's imitation allows the bunny correction and joint preparation steps of the patented laugh a posse procedure to be performed through to centimeter incisions and our speed plate implant fixation platform this is a new fixation technology platform designed for rapid insertion thirst small to send meter incisions serving as both an enabling technology for the micro apoplexy flashy procedure but author with broader replicability to our standard and many incision lot of party systems as well as a doctor fighting for procedures we continue to anticipate the commercial release of these technologies during the second half of twenty twenty three we're excited about the potential benefits this micro lap a plaque these people a combination could bring the patients as with a procedure that involves smaller incisions and less to she gets action we believe that can translate even faster pace or recovery with less pain and swelling we look forward to providing additional updates are new product innovations as we continue to develop our pipeline centered on our core technologies an ip aimed at improving certain user experience patient outcomes and supporting continued market penetration turning the clinical data the key differentiating driver for our business is our commitment to clinical evidence which we believe resonates with those surgeons and their patients from what we can see in the marketplace we believe were the only industry protests at them with a growing body of clinical data demonstrating rapid return to weight bearing in a walking boot with low recurrence rates at twelve and twenty four months and interim data demonstrating positive patient report outcome scores following our bunny correction procedure during the fourth quarter we now the treatment of the first patient and are empty a three day a doctor posse clinical study as a reminder the empty a three d study as a prospective multicenter clinical studies that will evaluate outcomes of a doctor flashy combined with the lap a party for procedure for patients the need a bunyan in mid for deformity correction we look forward to providing interim updates on are empty a treaty study in the future at the twenty twenty three american college of foot and ankle surgeons annual scientific conference in february we announce an interim data analysis from our flagship a line three day prospective laugh a posse study on one hundred and twenty eight patients with at least twenty four month follow up which demonstrated early return away bearing in a walking boot and an average of april one days a low recurrence rate of point nine percent eighty point eight percent reduction in pain measured using a visual analog scale or vassar twenty four months ninety two and ninety percent improvement in walking standing and social interaction patient reported quality of life measures respectively using the manchester oxford for questionnaire are marked fq through thirty six months and notably ninety seven point three percent of patients reporting they were satisfied or very satisfied with the overall results other lap a posse procedure thirty six months we believe were the only company to offer this level of clinical evidence on a commercial surgical bunyan product and it's rewarding to see the meaningful impact the lap of see procedure is making on patient was not only physically but socially as well as demonstrated by the hi ninety seven percent patient satisfaction rating at three years posts lap of hockey surgery as a reminder later this year we expected summit our primary endpoint on line three d manuscript for publication in a peer reviewed journal this is a milestone cup combination of activity that began five years ago with the first patients enrolled and twenty eighteen again we believe the positive and are impatient data coming from are differentiated a line a study resonates strongly with the surgeon patient communities as further reinforcing market adoption the lap of posse in closing twenty twenty two with another strong your performance and growth our company we are experiencing significant momentum in all aspects of our business and have developed a specialized and scale business model that we believe allow us to continue to advance or growth strategy i'm proud of the great execution delivered by our team here in part of eater to florida and throughout the country and we remain highly an extremely excited about our future prospects as we continue to execute on our strategic plans but that on i'll turn the colorado mark to review our financial performance mark thank you john good afternoon everyone revenue in the fourth quarter with forty nine point eight million dollars up sixteen point three million and forty nine percent over the prior year
spk_4: growth was driven by increases in procedure volumes and an increase in blended average selling price due to adoption of our new or complimentary technologies
spk_3: our seasonally strong fourth quarter revenue increased fifty one percent sequentially over que three in the fourth quarter twenty twenty two the number of active surgeons performing at least one case and the trailing twelve months increased thirty four percent year over year to two thousand three hundred eighty seven surgeons which translates approximately twenty four percent penetration of the estimated ten thousand surgeons in the us who perform
spk_4: by new procedures surging utilization increase to an average of ten point three like a plastic has purchased in the trailing twelve months up from an average of nine point eight a year ago we are pleased with is notable increase as reminder we commercialize lap a classy seven years ago and in the past two years alone we've added one thousand one hundred and twelve active surgeons nearly half of our total lack of search base on the average is growing number of as surgeons steadily increase utilization each year they use level classy did positive patient outcomes and expanding indications in their practices we sold eight thousand four hundred and twenty six lap a classy procedure kids in the fourth quarter a thirty five percent increase versus the prayers fourth quarter blended average selling price and fourth quarter was five thousand nine hundred and seven dollars a ten percent increase over the fourth quarter in twenty twenty one driven by the adoption of law apple classy and a doctor classy systems as well as early impact from or newer technologies are as for a plating kit speed release and try tom instruments
spk_3: we continue to see greater uptake of our other complimentary forefoot products as we add direct sales reps who tend to focus more on selling these complimentary products while in lap of lassie cases displacing other competitive been in related forefoot products
spk_4: for the poor year twenty twenty two revenue was one hundred forty one point eight million dollars a fifty percent increase over twenty twenty one slightly above the top end are pronounced revenue expectation of one forty one point two to one forty one point seven million and above our prior twenty twenty two reverend and guidance range of one third he five to one hundred thirty eight million we sold twenty four thousand six hundred and fifty six laptop lassie procedure kids from four year twenty twenty two a forty one percent increase vs prior with a blended average selling price of five thousand seven hundred fifty three a seven percent increase over the prior year gross margin was eighty point four percent and the fourth quarter of twenty twenty two compared to eighty one point one percent in the fourth quarter of twenty twenty one the seventy basis point decrease was due in part to an increase in capital a surgical instruments and related depreciation necessary to support are expanding direct sales force as well as increases in payroll and related costs for the full year twenty twenty two gross margin with eighty point six percent down from eighty one point one percent in the year ago period primarily due to increases in couple a surgical instruments and related depreciation necessary to support or increased direct sales force as well as increases in payroll and related costs total up spreading expect were forty three point five million dollars in the fourth quarter of twenty twenty two which include sales and marketing expenses of twenty nine point four million research and development expenses of three point seven million in general and administrative expenses of ten point four million that compares to total operating expenses of thirty two point seven million in the fall fourth quarter of twenty twenty one which included sales and marketing expenses of twenty two point three million research and development expenses of three point four million and general it and ministry of expenses of seven point zero million for the full year twenty twenty two operating expenses were one hundred forty nine point two million dollars hours compared to ninety three point one million in a prior year period the increase in operating expenses reflects strategic investments and are expanding direct sales channels investments and product innovation increase capacity requirements as well as support for other commercial initiative fourth quarter net loss attributable to common stock holders was four point four million or eight cents per share compared to a net loss of six point six million or twelve cents per share the same period of twenty twenty one full year twenty twenty two net loss attributable to common stock holders was forty two point eight million and or seventy seven cents per share compared to a net loss of twenty point seven million or forty three cents per share and twenty twenty one as noted we entered the fourth quarter or seasonally strongest with approximately three hundred thousand dollars in adjusted ebitda
spk_3: cash cash equivalents and marketable securities were eighty one point three million as of december thirty first twenty twenty two on february eighth we completed a follow on offering of five million four hundred seventy six thousand one hundred and ninety shares a common stock which raised net proceeds of one hundred seven point five
spk_5: five million dollars
spk_4: this is the first time we raise capital since our ip out and we believe this provides us with additional bout it's strength and flexibility to continue aggressively executing on our strategic investments and growth initiatives
spk_3: before concluding let me turn to our outlook for full year twenty twenty three
spk_4: as john mentioned we're providing full year twenty twenty three revenue guidance of one hundred eighty seven to one hundred ninety three million an increase of thirty two to thirty six percent over twenty twenty revenue we remain encouraged by underline strength and momentum in our business with so tj investments clearly delivering on growth for the first quarter twenty twenty three consistent with prior years we expect a sequential revenue decrease from the fourth quarter to to normal seasonality coming off our usual strong year and performance unlike he won twenty twenty two we do not expect incremental revenue from rescheduled fourth quarter procedures to benefit the first quarter of twenty twenty three turning to the middle of the piano we expect that our operations and expenses will continue to grow throughout twenty twenty three as we increase or decrease the investments and further expand our direct sales force while increasing leverage of are fixed costs and overhead expenses therefore we expect to show modest improvements suggested a bit off for the full year compared to twenty twenty two before turning the call over to the operator i like to provide an update on our ip litigation as you recall we filed a lawsuit in march twenty twenty two to enforce our ip although the terms are confidential we reach a mutually agreeable resolution to settle the matter and are pleased with the outcome since inception we've made import investments in our proprietary technologies and remain committed to protecting and growing or ip portfolio with that when it's really call over to the operator tell of the line for your questions
spk_6: thank you
spk_1: ladies and gentlemen as a reminder to ask the question please press thought one one or yes telephone and wait for your name to be allowed to withdraw your question please press start one one again please and bobby pulled out the q and a boston our first question comes from lot of robbie marcus with jp morgan you on open
spk_7: oh great start with congratulations again on a great quarter and and died on the lethal we could talk about the trendsetter informing the guide here you're you're clearly adding a lot of reps yeah revenue per procedure continued to grow at maybe speak to just how you think about the key drivers at the guide and and any color you want to give us van had a think about it the growth the clean the volume was vs that the revenue per procedure
spk_4: thanks robbie a great great question you know we as a job mention in the prepared remarks we feel really encouraged by the strengthen the momentum that we experience in the back half last year we had really strong growth and both third quarter and then again in the fourth quarter and we believe a lot of this has been driven by the investor that with the make him throughout the for here last year you know namely it's really that bad growing and building a direct sales channel which we believe it's already beginning to have some dividends that we've experienced and they been able to push through some of the when so we've had historically so that's one of our primary drivers the other thing that we're looking for him as we talked about they'll they'll be it in his ex excuse me to enhance dad btc and patient awareness efforts we think that now that we've got a larger and larger surgeon base that it's the right time to continue to invest and in a patient awareness
spk_3: now that we've got more surgeons an nfl sources support those additional inquiries
spk_7: and guy and i feel like i know the answer that are asked to last get anyways given the growth you're saying you're expecting but ah enough it's a large a very large under penetrating market for instrumented procedures there a lot of companies going after it maybe just give us a sense of what you're saying out the old ah are there any products that are companies you're breathing accounts to and in a what's a competitive that message on that your apps are putting out there to to keep the growth engine bella thanks a lot
spk_8: yeah hi robbie john
spk_3: thanks for the question and ah yeah you know which i go back to the fundamentals here that are our our number one competitors we see it is the us the to be procedure seventy percent of the procedure base and changing the mindset of the certain is using lap a plastic for the majority their bunyan cases person the minority that's where we really focus our efforts with are surgeon education programs are direct sales force and and even the patient our awareness that comes into play there so it can bring that procedure not a company's products specifically that that were after and that's what's been the underlying growth driver this business for the past seven years and we're going to continue to focus that that said that there are few companies on the market and more are entering with products claiming to be like lap of they were really seen a notable increase in the pressure or impact on us from those
spk_8: of companies are products
spk_3: as as we know the markets really large over five billion and were just way out ahead of everybody we've always expected that these companies would try to come along and opportunistically get a piece of the market that we your pioneered and develop here and in some ways the company's coming to market sort of validating us but keep in mind that these products are coming from companies that have multiple product lines highly destructive sales forces large bags of products style of which this yeah
spk_8: wow last be like product is just yet another
spk_3: and with over seven years of use and refinement of last flashiest shit so elegant and reproducible at the doctor patient interface how it works and it's protected by a lot of pass the only have a tremendous and portfolio for years she pads er calculator a the technology making it faster easier for the surgeon and ways to make it a quicker recovery for the patient so nobody's out there with that level of commitment to a rating improving and and modifying are rapidly but yeah the other barriers we haven't just the beyond that and the ip in the product innovation or beach had of clinical data that keep getting stronger and stronger the bunyan focus direct sales channel are are powerful surgeon and patient training programs the a while the service really great authentic drivers of our business the office service great defensive barriers as well so i kind of a long as your question but i think for these multi line distracted companies it's really hard to compete with a rapidly innovating highly focused comp many with a first mover advantage that so far out ahead you're like we are
spk_7: that's really helpful appreciate the color
spk_9: sir thank you
spk_1: please thereby for our next question i'll next question come from a lot of to remarry with morgan stanley yaalon with open
spk_10: i think you're taking the cousins and because on recording guy that on
spk_3: maybe just another that is coffin to start by bad as you are thinking about the guidance build for the here can you may need his help as kind of parse out how you're thinking about the maturing certain days virtualization improvement in your your already at around ten percent penetrated for for surgeons the just maybe the how you can say here about those factors i in the guide and at this is really going to be a year we're all those mature ah acc assertions the value over the past two years really kind of move up the utilization curve
spk_4: andrew this is mark i agree question and and thanks for joining us yet you know we we've previously commented that a lot of our revenue growth year over year is not purely from from new surgeons bed from the increase utilization of our existing surgeon base and so we've been really pleased with any my prepare their remarks i commented on nearly half of our act of surgeons palm canada last two years what we do believe though is that there is an incremental build of of utilization year after year it doesn't come you know exclusively in your to or exclusively in year three so we believe that a lot of the patterns that we've seen
spk_3: year after year will continue to to hold true as we continue and plan to add new surgeons this year and twenty twenty three as well and our existing surgeon base will continue to to move up the chain and have increased utilization on average we have commented that in the most recent twelve
spk_4: month period that new surgeon have been adopting lab a classy at a faster rate than they ever have before so we believe that the surgeons who are coming to our lab is getting trained they're very interested in adopting lab a platform in the end of the data is proving out there when they do come become a customer they're actually doing more cases are than the average shows and what more than what we've had historically south all is built into to our revenue build for that the guidance and with that we gave so we feel really good about the strong surgeon base we plan on adding more and with now god that direct sales channel to to support all the resurgence in a jury
spk_10: on the banks and and maybe just a couple other financial questions to are just as we do you think about the seasonality from forty to one you on that marca jaeger your comment that all this pass for corner was ah had the benefit from recapping some burqas procedures the can we be a just maybe help
spk_7: a spotify her bow line it may maybe his final step down and and second i can you help us and we'll that mara with our backs for the year just in terms of your revenue growth rate that you take the questions
spk_11: yeah thanks true
spk_4: so i wanted to comment in in the remarks that mean other was a little bit of an anomaly we're we're glad that we're not talking about are making references the cove it anymore but one it's him but just bring tehran's a memory that que one of twenty twenty two did have some benefit from some rescheduled cases so historically and if you adjust for some those is some of the benefit and he won you know the last couple years we've had a step down and said he wanted has been roughly about eighty percent of the revenue know plus or minus that around eighty percent of revenue and queue for so that that's a very normal step down and that's what we experience last year you know
spk_11: if you adjust the revenue out of he won and kind of push it back in the queue for that but that would have been same so we would expect something very similar to to that as we come into twenty twenty three am
spk_12: overall you ask a question about the the the our backs and you know we're going to continue to to invest in the company john out outline several things are we will continue to do work with continue to build a sales channel will continue to invest in orange he and we will have some incremental or investments in our dtc program for the way
spk_4: ill be some build ah but overall doubt they'll be some improve leverage and twenty twenty three vs twenty twenty two
spk_13: and the cautions
spk_6: thank you
spk_1: as a reminder ladies and gentlemen that star one one to ask the question please stand by for all next question alex question comes from the lot of ryan zimmerman with bc i g on open
spk_14: ah could have been thanks for taking the questions and congrats on another growth and everything is said before sitting here american academy of was flick surgeon you're thinking about kind of we are marginal costs around now i know it's not a general arthropods bonus nuts i pick up a laugh a plastic it but knows you think about the one point one million potential bugging surgeries out there versus those that are having the four hundred fifty thousand how have you think about that four hundred fifty thousand growing over the next few years in a what's it gonna take is it more dtc know what is this your jog your thoughts on general mardi gras and and what move the needle from you know after surgery to penetrate more those candidates
spk_3: hi ryan i get get get do i hear from you and thanks thanks for the question yeah so i think if the up you look at all the up kind of stared martyr reports that companies can acquire out there they with they would typically show the bunyan procedure base growing it your three to four percent maybe for the next five years that's that's my recollection you know how how we try to expand that is is obviously through our dtc impatient awareness efforts and investments
spk_15: if if we can get to
spk_3: get out those fence sitting patients with our dtc messages with are stronger clinical evidence and communicate at there are they better proceed with now a better offering on than there was in the past that recurrence rates can be much lower than they were in the past that you can get back to bury wait on and back to your activities at a at a predictable time than we think that can resonate with think that can bring some of these fence sitting patients you know over the fence and you know connecting with our doctors maybe for a consultation through our website ah about lap a plastic so i think i think in the coming years that's that's our project we're gonna try to work to expand you know are relative force and into the one point one million as best we can and got yeah that's where open our efforts
spk_14: turn off and a not not and an easy question and there's no magic in a silver bullet i guess but prescience the commentary and then the second question is just around complementary price and in are so important for your got know be that you think about the model and and and thought the move higher in a a fees and why did you can can help us understand what the task a far as you think about them today for for your key kind of cosmetic products and and and where you think you can take that over time or where we should think about that going over time thank you for taking my question
spk_3: sure sure the for the complimentary products know definitely a a great part of our strategy and and most of our complimentary products are all aimed at ya improving the outcomes for these by patients we gotta a doctor party because we recognize people with that made for deformity didn't get as good an enduring correction our last and correction with their their buying procedure if he didn't fix the midwest so these are all yeah really tied together so the attachment rate i think kind of goes hand in hand if if a surgeon is doing and a doctor party procedure ninety nine percent the time they're going to be doing a lap a posse as well on our speed really censor minutes another excellent example of an instrument that can make the up the great how tissue release says roy really it's much easier more predictable for the surgeon ah and a thicker than over ninety five percent of our lab about the case is so a cat or a can be very very high there once we get a doctor trained on it and they implemented their practice the other things like the as for a place not really complimentary but heavy conversion going on right now on the field to doctors windy you that next generation more advanced you're playing geometry on their patients and supplanting earlier versions of our are are pleading with that and then of course in the back half later this year your we'll we'll be releasing this be micro lot of asking this be plate technologies and the xp place going to be a really neat our technology platform for us it's gonna be used and ah variety of lap classy another mid for cases as well and some
spk_6: sure thank you
spk_1: thank you
spk_16: i'm sure no further questions and with you i will now like to turn the call back to the be on for closing remarks
spk_1: funky to launder thanks everyone for joining us today on behalf of to medical the fukuda call and will a fourth are of the following the closest the first quarter twenty twenty three
spk_0: thank you you may now disconnect

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