Artivion, Inc.

Good afternoon and welcome to the RTVN fourth quarter and year-end 2025 earnings call. At this time, all participants are in a listen-only mode. A brief question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. I would now like to turn the conference over to Lane Morgan from the Gilmartin Group. Thank you. You may begin.

Thanks, operator. Good afternoon, and thank you for joining the call today. Joining me today from our TIVI management team are Pat Matkin, CEO, and Lance Berry, COO and CFO. Before we begin, I'd like to make the following statements to comply with the safe harbor requirements of the Private Securities Litigation Reform Act of 1995. Comments made on this call that look forward in time involve risks and uncertainties and are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The forward-looking statements include statements made as to the company's or management's intentions, hopes, beliefs, expectations, or predictions of the future. These forward-looking statements are subject to a number of risks, uncertainties, estimates, and assumptions that may cause actual results to differ materially from these forward-looking statements. Additional information concerning certain risks and uncertainties that may impact these forward-looking statements is contained from time to time in the company's SEC filings and in the press release that was issued earlier today. You can also find a brief presentation with details highlighted on today's call on the investor relations section of the Attibian website. Lastly, I'd like to remind you to please refer to our press release published earlier today for information regarding our non-GAAP results, including a reconciliation of these results to our GAAP results. Unless otherwise stated, all of our comments today will be using our non-GAAP results. Additionally, all percentage changes discussed will be on a year-over-year basis, Revenue growth rates will be the adjusted constant currency rates and expenses as percent of sales will be based on adjusted revenues. Now, I'll turn it over to Artivion CEO, Pat Mackin.

Thanks, Elaine, and good afternoon, everybody. 2025 was a highly successful year for Artivion, during which our team made meaningful progress against our strategy design to drive long-term growth, profitable growth through our expanding and clinically differentiated product portfolio. I'm pleased to report that for the full year of 2025, total adjusted constant currency revenue growth was 13% and adjusted EBITDA growth was 26% year-over-year. This enabled us to deliver positive free cash flow for the year while also investing significantly in future growth and operational excellence. Our progress through the year culminated in a strong fourth quarter with performance driven by continued growth across our entire product portfolio led by StenCrafts and Onyx. As a reminder, during the fourth quarter of 2024, stent graft and preservation services businesses were negatively impacted by the cybersecurity incident. With that in mind, from a product category perspective, stent grafts grew 36% on a constant currency basis in the fourth quarter compared to the same period last year. Year-over-year growth was again driven in large part by AMDS in the U.S., continued strong growth in stent grafts internationally, as well as an easier year-over-year comp due to last year's cyber incident. We see our StentGraph portfolio as foundational component of our growth, and we are encouraged by the continued strong results across the portfolio. Looking ahead, we intend to replicate our proven strategy by bringing additional StentGraph products that are already generating revenue in Europe to the U.S. and Japan, which we believe will unlock further meaningful expansion of our StentGraph total addressable market. Also in Q4, our ONIX revenues grew 24% year-over-year on a constant currency basis. Growth was driven by our continued global market share gains and early traction in our new $100 million U.S. market opportunity unlocked by recently published data. As previously discussed, the clinical evidence supported by two leading journals demonstrated improved outcomes with mechanical versus bioprosthetic valves for younger patients. As a result, we maintain a strong conviction that Onix is the best aortic valve on the market for patients under the age of 65, and that we'll continue to take market share worldwide in that product line. In Q4, tissue processing revenue, which was the category most heavily impacted by last year's cybersecurity event, increased 6% year-over-year on a constant currency basis. Lastly, BioGlue was relatively flat on a constant currency basis compared to the same period last year. As we've discussed previously, we expect to see some variability in the growth rates of BioGlue quarter over quarter, driven by the significant amount of stocking distributor business in that product line. In addition to our strong financial performance, we continue to advance our clinical programs and pipeline. Recently, in January, we saw positive new clinical data from the AMDS-Persevere and Nexus-Triumph trials presented at the STS annual meeting in New Orleans. First, the two-year data for AMDS-Persevere trial demonstrates continued clinical benefits of AMDS after one year, including minimal additional mortality and morbidity, no additional unanticipated aortic reoperations, and the continued absence of vein tears. These data build on the positive findings from the 30-day and one-year readouts, further supporting the lifesaving nature of the AMDS technology, which represents our nearest term PMA opportunity. While the HDA enables us to sell AMDS in the U.S. ahead of the PMA approval, we remain focused on securing the PMA for AMDS. We are pleased to report that we recently filed the fourth and final module with the FDA, keeping us on track for FDA approval in mid-26. Second, our partner, Endospan, presented one-year data from the U.S. IDE trial for its Nexus aortic arch stent graft system. This trial is the first FDA IDE trial for the endovascular treatment of chronic dissections in the aortic arch and is focused on patients at high risk for open surgery. The data highlighted 94% of patient survival from lesion-related death and 91% of patients were free from stroke at one year post-treatment in this high-risk patient group. The data also showed 97% of patients were free from interventions due to endo leaks. In our discussions with physicians at STS, surgeons generally expressed that they believed that the one-year results were extremely promising. Based on these positive outcomes, we believe Nexus remains on track for approval in the second half of 2026. Lastly, on our pipeline, we continue to make progress on the Artisan trial for our R-Civo LSA product. We now have eight patients enrolled in our trial, which is a non-randomized clinical trial consisting of 132 patients in the U.S. and Europe at up to 30 centers for treatment of aortic dissection and aneurysm. The combined primary safety and efficacy endpoints assess the reduction in all-cause mortality, new permanent disabling stroke, new permanent paraplegia or paraparesis, unanticipated aortic reoperation in the treated segment, and less of clavian artery occlusion. We anticipate completing the full enrollment in mid-27. We're optimistic that the trial will be successful, supported by the positive clinical results from our current generation frozen elephant trunk, Aveda OpenNeo, We're outside the US. Following our one year follow up period, we're assuming that the trial meets its endpoints. We anticipate FDA approval for our Siebel LSA in 2029, unlocking an incremental 80 million in annual US market opportunity. In conclusion, 2025 was a standout year for Arctivion, and our strong financial, clinical and regulatory execution positioned us well for continued growth in 2026 and beyond. We remain confident in our ability to deliver sustainable double-digit revenue growth, drive EBITDA margin expansion, and grow adjusted EBITDA at twice the rate of constant currency revenue growth over the long term. With that, I'll now turn the call over to Lance.

Thanks, Pat, and good afternoon, everyone. Before I begin, I'd like to remind you to please refer to our press release published earlier today for information regarding our non-GAAP results, including a reconciliation of these results to our GAAP results. Additionally, all percentage changes discussed will be on a year-over-year basis, and revenue growth rates will be in adjusted constant currency unless otherwise noted. Total adjusted revenues were 118.3 million for the fourth quarter of 2025, excluding the Italian payback adjustment, up 18.5% compared to Q4 of 2024. Meanwhile, adjusted EBITDA increased approximately 29% from 17.6 million to 22.7 million, in the fourth quarter of 2025. Adjusted EBITDA margin was 19.2% in the fourth quarter of 2025, and approximately 110 basis point improvement over the prior year driven by leverage in SG&A. For the full year, total adjusted revenues were $443.6 million, up 13% compared to full year 2024. Adjusted EBITDA grew 26% for the full year, twice the rate of adjusted revenue growth. This resulted in an adjusted EBITDA margin of 20.2%, a 190 basis point improvement from 2024. Before the detailed review of our results, I would like to comment on the impact of the Italian government's payback legislation to our 2025 financials. You may be familiar with this as it impacts a number of medical device companies. In 2015, the Italian government passed legislation requiring medical device companies that supply goods and services to public Italian hospitals to pay back a portion of their revenue when regional healthcare spend exceeds specified budgets. The applicability of this law was subject to extended legal proceedings, and after years of litigation, the Italian government proposed a settlement for fiscal years 2015 through 2018, which became effective in Q3 of 2025. The impact on us for those fiscal years was minimal. Subsequently, to address the ongoing impact of the law in years after 2018, during the fourth quarter, we recorded a $2.3 million adjustment to revenue for the estimated payback obligations for fiscal years 2019 through 2025, which has been excluded from our fourth quarter and full year adjusted revenue. I want to highlight that while we are subject to this law after 2025, the quarterly impact is expected to be immaterial compared to this cumulative adjustment for 2019 through 2025. We do not expect to adjust for this payback moving forward unless there are significant changes to prior period estimates. To further contextualize our underlying fourth quarter performance, I will provide additional details on our results excluding the impact of the 2024 cybersecurity incident. As previously disclosed, the incident had a negative impact of approximately $4.5 million on Q4 2024 revenue approximately 2 million in stent grafts, and approximately 2.5 million in tissue processing. As a result, we estimate that our underlying business grew 13% for the fourth quarter of 2025, adjusted for impacts associated with the cyber incident and Italian payback. With that, I will now move on to our Q4 results. From a product line perspective, stent graft revenues increased 36%, onyx grew 24%, tissue processing revenues grew 6%, Embodiment revenues were flat in the fourth quarter of 2025. As previously discussed, the cyber incident primarily impacted our stent graft and tissue processing revenues. Excluding the previously discussed impact of the cyber incident from our prior year results, our fourth quarter stent graft revenues increased 28% and our tissue processing revenues declined 4%. I would like to note that tissue processing growth for the full year declined 3% compared to 2024. This came in below our expectations driven primarily by the lingering impact of the cybersecurity incident in Q1. Moving now to our regional performance, revenues in Asia Pacific increased 32%, North America increased 18%, EMEA increased 17%, and Latin America increased 9%, all compared to the fourth quarter of 2024. Q4 gross margins were 63% in both 2025 and 2024, As a reminder, the 2024 gross margin was negatively impacted by approximately two percentage points by an idle plant charge due to the cyber incident. The 2025 gross margin was negatively impacted by roughly one percentage point from the Italian payback adjustment, and was also impacted by certain manufacturing inefficiencies that we do not anticipate to repeat in 2026. General administrative and marketing expenses in the fourth quarter. were 56.8 million compared to 51.4 million in the fourth quarter of 2024. Non-GAAP general administrative and marketing expenses were 53.5 million or 45.2% of sales in the fourth quarter compared to 47.5 or 48.8% of sales in the fourth quarter of 2024, reflecting a 360 basis point improvement. Approximately 200 basis points were driven through leveraging existing infrastructure and approximately 160 basis points were from stock-based compensation. Our as-reported expenses included a gain of approximately $2.9 million in Q4 associated with the cybersecurity incident, which are excluded from adjusted EBITDA, reflecting a $3.2 million insurance reimbursement for costs we incurred in previous periods. R&D expenses for the fourth quarter were $9.1 million or 7.7% of sales compared to $7.4 million or 7.6% of sales in the fourth quarter of 2024. As expected, an uptick in spending from previous quarters this year due to the start of the artisan clinical trial. Interest expense net of interest income was 5.2 million as compared to 9.4 million in the prior year. Other income expenses quarter included a nominal amount of foreign currency translation losses. Free cash flow for the full year was above expectations, coming in at approximately 1 million despite continued investments in our business, including one-time cash payments of approximately $20 million related to the previously disclosed purchase of two Austin facilities in the fourth quarter. We previously anticipated one of the buildings closing in Q1, 2026, but we were able to close in Q4. As of December 31st, 2025, we had approximately $64.9 million in cash and $215.1 million in debt, net of $4.9 million of unamortized loan origination costs. At the end of the fourth quarter, our net leverage ratio was 1.8, down from 3.8 in the prior year. And now for our outlook for 2026. Please note that this outlook excludes any impact from the potential acquisition of Indospan. We expect constant currency growth between 10% to 14% for the full year 2026, representing a reported revenue range of $486 to $504 million. This guidance contemplates FX to have an insignificant impact on our as-reported revenue for the full year. On a segment basis, we expect similar business dynamics to be in place in 2026 as there were in 2025, with a few items to note. First, we will be in year two of the AMDS launch, resulting in more difficult comps as the year progresses. Second, our tissue business fluctuated a fair amount quarter to quarter due to the impacts of the cyber event. Overall, the business was relatively flat for the full year. And at this point, we feel it's prudent from a planning perspective to assume that that business will remain flat in 2026. Given these factors, we expect full year 2026 tissue revenue to be relatively flat compared to the full year 2025. Year-over-year biozoo growth to be in the mid-single digits, onyx growth rates to be in the mid-teens, and stent graft growth rates to be in the low 20s. As it relates to quarterly cadence, we expect growth in the first quarter of 2026 to outweigh growth in the rest of the year. This is driven by an easier Q1 comparison due to lingering revenue impacts in Q1 2025 from the cybersecurity incident. Tougher comps in the second and third quarters due to the recovery of the tissue backlog. and tougher ONIX and AMBS comps starting in Q2. Altogether, this results in Q1 constant currency growth rate towards the high end of our full year range with lower constant currency growth rates for the remaining quarters, and we expect the second through fourth quarters to have fairly similar constant currency revenue growth rates. With our continued top line revenue growth and general expense management, We expect full year 2026 adjusted EBITDA to be in the range of 105 to 110 million, representing a range of 18 to 22% growth over 2025, and approximately 150 basis points of adjusted EBITDA margin expansion at the midpoint of our ranges. Additionally, we expect gross margins to improve by approximately 50 basis points, driven by mixed benefit from U.S. AMVS and U.S. ONIX sales growth. We also expect approximately 200 basis Points of leverage from SG&A partially offset by an expected 100 basis point increase in R&D as a percentage of sales. Altogether, this results in EBITDA growth at the midpoint of our range that is slightly below our target of 2x our revenue growth rate. The primary driver of this is an increase in R&D spend from 7% of sales in 2025, which is at the low end of our targeted range, to approximately 8% in 2026, which is at the high end of our targeted range. This is driven primarily due to timing as we had minimal clinical trial expenses in 2025 and expect a full year of artisan trial related expenses in 2026. Although there will be some variation in R&D as a percentage of sales from year to year, we do not expect it to be this significant going forward. On interest expense, we expect 2026 to be more consistent with our fourth quarter exit rate following the mid-year 2025 refinancing. We also expect free cash flow to be slightly positive for the full year 2026. Lastly, we expect CapEx to be approximately $50 million in 2026, up from $39 million in 2025. We see a long-run rate for ONIX growth globally based on the growing body of clinical evidence supporting the use of mechanical valves in younger patients and ONIX's differentiated low INR indication. Accordingly, we are investing in facilities, equipment, and systems to ensure we can efficiently support that growth over the long term resulting in elevated CapEx in 2025 and 2026. In general, our business is not capital intensive, and we expect CapEx to moderate in subsequent years. In summary, we are pleased about our 2025 performance and are excited about the prospects of the business in 2026 and beyond. With that, I will turn the call back to Pat for his closing comments.

Thanks, Lance. So we're very pleased with our 2025 performance and our position entering 2026. which reinforces our confidence of our growth strategies working and delivering the results we envision. More specifically, we expect future growth to be driven by the following key growth drivers. First, AMDS HDE. We're commercializing AMDS in the U.S. and continue to penetrate the $150 million annual U.S. market opportunity with new clinical data and reimbursement dynamics likely adding as a further tailwind. Number two, on a cart valve data. We are educating healthcare providers on the new clinical data showing a mortality and re-operation benefit in patients under 65 years of age compared to bioprosthetic valves. This is a new $100 million annual U.S. market opportunity that we'll be pursuing with the only mechanical aortic valve that can be maintained at a low INR of 1.5 to 2.0. Number three, the Nexus PMA. We are pleased with the positive new one-year clinical data from the Nexus Triumph trial, which we believe, assuming we exercise our option, to acquire Endospan. This will bring us one step closer to being able to access the annual U.S. market opportunity for this device of 150 million. And fourth, the Artisan IDE trial. We continue to make progress on our third generation frozen elephant trunk called R-Civo LSA, and the clinical trial which represents an incremental 80 million annual U.S. market opportunity. Finally, I want to thank all our employees around the globe for the continued dedication to our mission of being a leading partner to surgeons focused on aortic disease. With that, operator, please open the lines for questions.

Thank you. We will now be conducting a question and answer session. If you would like to ask a question, please press star 1 on your telephone keypad. A confirmation tone will indicate that your line is in the question queue. You may press star 2 if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment, please, while we poll for questions. Our first question comes from Bill with Canaccord Genuity. Please proceed with your question.

Yeah, great. Thanks for taking my question. You know, I think what I'm trying to get my head around is just the Italian clawback obviously kind of skews the numbers a little. So, my questions are going to roll around that as, you know, first is, I assume that's in OUS, not US, because your US growth was in the high teens. I assume that was hit by the preservation services growth. But I'm trying to figure out, you know, did it flow through any specific products? Kind of how did it? It sounds like it also impacted the P&L. And then I think what I'm really trying to get at, you know, given the growth rate year over year, I think the U.S. was a little lower than what we would have expected, you know, given how strong the Stentcraft business was. And I'm trying to, you know, it goes into the AMDS question on sell-in versus sell-through there. I know there's a lot in that, but it kind of, the Italian stuff kind of might be throwing some of the numbers off.

Let me maybe try and clear up some of the details around the Italian payback. First of all, yes, it was in OUS, specifically in the EMEA line. Second, it was reported in other line item of revenue, so it did not impact any of the big four line items. It's not skewing that growth rate that we discussed in any way, shape, or form. You know, hopefully that's helpful. And then if you look at the U.S., you know, really, honestly, if you just step back and look at the growth rates, you know, for the business from Q3 to Q4, almost whatever you're looking at, the main difference is just the tissue business. And that business, if you take out the impact of the EZ Comp and the cybersecurity event, the growth rate was quite a bit lower. in Q4 versus Q3.

Okay. And then just really kind of the final thing is just any commentary you can provide on the sell-in versus sell-through on the AMDS. And, you know, I mean, you lifted, you expect continued guidance, I think, well above our expectations on the AMDS and ONIX. So, you know, that's a good trend. But I'm just, you know, a lot of people are focused on this.

Yeah. We typically don't break out the details on AMDS specifically, even in total for revenue. And so, you know, we also don't break out the details on the new account startups as opposed to the actual implantations. Other than I think we'll say the implantations are continuing to grow and they're continuing to go really well. I think, again, I've said this a lot of times that, you know, it's just important that that first experience for a surgeon is a good one. And so far that's been going really, really well.

Great. Thanks for taking my questions.

Our next question comes from John McCalley with Stiefel. Please proceed with your question.

Hi, Pat and Lance. I wanted to start off back where Bill was on AMDS. Very helpful color on just how the year plays out. Just was hoping for a little more color in the sense of How much is left to go here? Earlier last year, I think you mentioned target accounts and accounts that you were in at that point. How much progress have you made on that front? And what do we be expecting as 2026 plays out and you gain the full FDA approval?

Yeah, Lance, I'll take that. You know, so I think it's important. It's a good question, right? You want to make this the analogy to like baseball, you know, like we're in the first inning. I mean, we launched the product not like right out a year ago, had to go through all these value analysis committees that take six to nine months. So really 2025 was the year of, you know, opening accounts and we had implants, but we're already starting to see those, those accounts implanting, but we were probably only in 10% of the accounts. So, you know, in 26, we've got the opportunity to continue to open new accounts, but also get implants in the accounts you already opened. Right. So it's, I think it's very early for AMDS and, you know, that's why we're bullish on, you know, 2026 and driving the growth there. Yeah, that's very helpful, Pat.

And just broadly on Nexus, there's some impressive data coming out of STS. Just wanted to get your general reaction there and maybe help frame this market opportunity for us. Again, I believe there's an approved, somewhat similar competitive device in this market. Can you talk about how big the market is today and what Nexus can do to, one, help you gain share in that space, and, two, help expand the market beyond its current size?

Yeah, so you're correct. There's one product approved in the market. They got approval last May or June. So this is kind of a nascent market. From my conversations with clinicians, I mean, this is a – you know, particularly the trial kind of showed that, that these were patients that were at very high risk of open surgery. There's a category called ASA, which kind of characterizes the risk of a patient with all the different comorbidities. And, you know, two-thirds of these patients, or actually like 70% of these patients, were ASA 3 and 4, which would tell you that most surgeons are not going to operate on these patients. So, I mean, a good analogy is like the early, kind of the early TAVR was started in, you know, patients who couldn't withstand surgery, and then all of a sudden it started going other places. So, we see this as a platform technology. We say that the U.S. market's 150 million. You know, it'll take us some time to penetrate that, but it's a very unique technology, and we think we're extremely well positioned. I had a chance who saw the presentation, I think that this device will be very competitive in the U.S. market compared to the other player. We think they're on track for a PMA approval in the second half. And, you know, this just further goes to our focus in the aortic arch, whether it's AMDS or Nexus or our artisan trial with Arcebo LSA. So, you know, I think it just shows the company's commitment to, you know, bringing aortic technologies forward. to these surgeons so they can treat their patients. So I do think this is a first step in a very exciting new space.

That's great. Thanks for taking my questions.

Our next question comes from Suraj Kalia with Oppenheimer. Please proceed with your question. I'm not hearing anything. Saraj, are you there? Okay. Okay. We'll go to the next person then. Our next question will be from Jacob Melengink with Oppenheimer. Please proceed with your question.

Hey, Lance. Hey, Pat. This is Jacob on for Saraj here, actually. I guess first off, could you talk to us about how you're thinking about pricing for AMDS and by extension Nexus? Have you seen relative price insensitivity of demand that your assumptions of 25K for AMDS and 50K for Nexus are still seen in the right levels?

Yeah, I think it's an important point. You know, these are cutting edge, lifesaving therapies, first of their kind. that happened to come with a very favorable reimbursement, you know, background. So, that is not something we see at all in this space.

Got it. And then, just on your guide, what are the assumptions of the 10 to 14% CAGR? You know, how can we stress test the conditions for either end of that spectrum?

Well, I think it's, you know, if you look at kind of our history, I'll let Lance chime in here in a second. But, you know, we've got, you know, he gave you pretty clear direction. You know, we think tissue is going to be, we're going to, you know, forecast tissue flat this year because we saw it last year, you know, it took a while to recover on the cypress. We're going to be prudent. We think glue is going to grow by, you know, in the mid single digit. And we think onyx is going to grow mid teens. And we think stents are going to grow in low 20s. So it doesn't, you know, those are the things that particularly the onyx, I think half the portfolio, I think we feel very comfortable with. We understand the tissue and the bio glue. I think on the upside, how successful are we driving the Onyx message into the marketplace? And can we grow faster than that? And same with AMDS, you know, opening more accounts and getting more implants. Those are the two that can move you up very quickly, you know, above those ranges, which are going to drive the growth rate to the higher end of the range. Lance, do you want to comment? Yeah, no, I was going to say the same thing.

You know, those are the two things that are – our newest and our big opportunities and have a wider range of possible outcomes. And, you know, we're obviously going to be doing what we can to maximize both of them.

Thank you.

Our next question comes from Frank Tikkanen with Lake Street Capital Markets. Please proceed with your question.

Hey, Lance. I've got Nelson on for Frank. Congrats on all the progress. Maybe just to start, I wanted to ask about the DRG code that went live October 1st. Any measurable acceleration in VAC approvals or shortening of the timeframe from IRB to first case? Just any color there would be helpful.

We weren't seeing a – prior to the October 1st implementation of DRG 209, we weren't seeing the economics as a barrier. We weren't – again, whether it helped accelerate things – I certainly think it makes it a much easier conversation, although I think hospitals were doing fine before the new DRG. So I think I would just say it's a tailwind for us. I don't know, Lance, do you have any thoughts?

Yeah, I've yet to run into anything that significantly accelerates hospital bureaucracy. So I can't wait for the day when it happens. You know, they have a lot of DRGs that they sift through in a lot of products, and their value analysis committee kind of moves at the pace that it moves. But, obviously, the new reimbursement is a great fact when we do get in front of the value analysis committee, and I think it will be helpful when we get on the agenda.

Yeah, that's helpful. And then apologies if I missed it, but you mentioned last quarter they haven't launched formal marketing to

formal marketing program to cardiologists for onyx any sense of timing on that if you haven't started that already or how should we think about that as a potential lever on top of everything else you have going for you with onyx yeah i think i think that gets back to the question that was asked on the by the previous um person right which is you know your range of 10 to 14 the two things that stand out outperform um are onyx and stents because it's really the biggest opportunity You know, we see both of these as kind of five-year opportunities and how fast we drive the adoption, you know, we'll see. We're obviously going to do, you know, as aggressive as we can. But, you know, there's a lot of cardiologists out there we have to educate, and we've got several programs in place to, you know, deliver the message to the cardiologist, the referring cardiologist. So it'll take time, and we'll have a lot better sense this year, you know, when we start doing these programs and understand how many cardiology groups we get to and how the message resonates and how the growth rate moves forward. So I'm very optimistic because the market research, particularly on the onyx, when we talk to the referring cardiologists, these are the cardiologists that refer to the implanting surgeon. When we review the two papers that show a mortality and REOP benefit in patients under 65 for mechanical versus bioprosthetic, and we show them the onyx low INR data that nobody else has got, they were wildly positive to the point where they were going to refer onyx valves by name, branded, which you don't see very often. So, again, we're very excited. We just got to execute. And, you know, I think it's a multi-year program, but, you know, we'll have a better grip as we kind of move through 26. Helpful. Congrats, guys. Thank you.

Our next question comes from Mike Mattson with Needham & Co. Please proceed with your question.

Yeah, thanks. So, I guess, starting with AMDS, you know, when you do get the PMA, do you expect that to have any impact on the growth at all? Like, would it maybe halt a little or not make a difference?

I mean, I think the real meaningful change is just the You know, the main requirement of an HDE is you've got to get a local IRB at the hospital, which out of the blocks was a little confusing, but we figured it out. So it's the administrative stuff. So that will go away. But we don't feel like it's going to change, meaningfully change. I mean, the opportunities here with the HDE, it just gets rid of some of the red tape and bureaucracy of the IRB.

Okay, got it. And then where do things stand with getting AMDS into Japan? I mean, looking at your slides, I think you were saying about the end of this year.

Yeah, so Japan typically pegs off the PMA. So, you know, that clock is going to start once we get the PMA in the U.S. You know, so we should have an update. probably mid-year on AMDS Japan once we get the PMA in the U.S.

Okay. All right. And then just for the CapEx, I think, Lance, you said $50.5 million. Is that right for this year? And that's a pretty big step up from what was already a pretty big step up last year. So is that all just really to support the capacity expansion for Onyx?

Yeah, I mean, I think primarily the higher levels both years are primarily related to that. I would say also just, you know, we have upticked our own internal investment in IT systems to help drive, you know, better efficiency going forward than what we had done in the past. And I've, you know, told – investors before that, you know, at the moment, if there's an opportunity where we can invest capital to, you know, either improve, you know, revenue or SD&A leverage, then I'm really interested in doing that. And so a lot of it's often, but not all of it. And so I do think, you know, if you look into, you know, 27, 28, I would expect the cow tax to come down from where it is. I would not expect it to go back to where the historical levels were 24 and previous, but I would expect it to come down meaningfully. Okay, thank you.

As a reminder, if you'd like to ask a question, please press star 1 on your telephone keypad. Our next question comes from Daniel Stotter with J&P Securities. Please proceed with your question.

Yeah, great. Thanks for the questions. So first one, just on ONIX. Another really strong quarter. Wanted to ask if, you know, are you still seeing the same level of cross selling benefits with AMDS that you've mentioned in the past? And, you know, are there any trends you're seeing in terms of these newer surgeons and their on X utilization, just really trying to get at, you know, what you're seeing with some of these physicians that you added earlier in the year? Thanks.

Yeah, no, I think, you know, we're expecting that to be a, you know, an ongoing kind of benefit, right? So if you think about it, you know, there's 1,000 centers in the U.S. that do acute type A dissection. They also do aortic valves. So, you know, we're not selling onyx valves to all 1,000 centers. And for whatever reason, up to now, we hadn't had relationships with some of these surgeons. And they become interested in AMDS. They come to a training. The rep gets to know them, and then we show them the data. And I've had dinners with a number of these surgeons and, you know, after the dinner conversation with the new data and the low ANR and, you know, they go back and switch. So I think they kind of go hand in glove, right? As we continue to open new AMDF accounts and continue to build relationships with these aortic surgeons, we're going to get the message out on Onyx both to the surgeon as well as to the cardiologist, so. I think that cross-selling is going to be an ongoing thing for the next couple years as we continue to open up AMDS accounts.

Okay. That makes sense. That's helpful. Just one more from me. Focusing on Nexus, you know, could you tell us a little bit more about the eventual commercial process here? Is it really just, you know, the same playbook as AMDS, or do you expect the training and learning curve could be more or less intensive? Any more color on specific nuances to the eventual Nexus commercial rollout would be great.

Thanks. Yeah, they're very kind of opposite devices. If you look at it on a continuum, AMDS is extremely easy. The training requirement is really we can do it at a benchtop with a pig valve or, you know, pig heart. Every aortic surgeon can do it. The learning curve is like 1K if it adds five minutes to the procedure. So that really is kind of like a, you know, nirvana from a product launch because it's so easy. I would go to the other end of the spectrum. You know, Nexus is easy in that category, but these are highly trained vascular surgeons that are only in the biggest centers. So, you know, AMDS can be used in 1,000 centers. Nexus is probably a couple hundred centers. there's going to be extensive training because it's a all endovascular in the arch. It's, you know, the first device that's been trialed in chronic dissections. So I think there will definitely be, you know, more intensive training. We'll have to cover every case with a rep. And so, you know, they're very different, I would say. And, you know, again, I think we're well prepared for it. In some ways, it makes it a lot easier because it's not as many centers. And those centers are going to do a lot of volume. So, and they're all, like I said, highly trained, highly skilled vascular surgeons are already kind of skilled in the art of doing this. So, we just have to train them on how to use this technology.

Okay. Great. That's great insight. Thanks a lot. Appreciate it.

Mr. Mastin, we have reached the end of our question and answer session. I would now like to turn the call back over to management for closing comments.

Yeah, well, thanks for joining our Q4 call, and I hope you can hear in our voices we're super excited about 26. We think we've got a great opportunity to drive both our commercial business with the Onyx on the new clinical data and AMDS with the new data. We think we're going to get the PMA from AMDS halfway through the year, and we think Nexus is going to get their PMA in the second half. And we've got our trial enrolling on our SIBO, and we expect that to be our next PMA in 29. So, That's kind of our business model, which is a new PMA every two years to keep the double-digit growth and EBITDA twice as fast over the long term. So we appreciate your attention and support of the company. Look forward to the next call.

This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation.