Edwards Lifesciences Corporation

Greetings and welcome to the Edwards Life Sciences third quarter 2023 earnings conference 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. It is now my pleasure to introduce your host, Mark Wilterding, Senior Vice President, investor relations, and treasurer. Thank you. You may begin.

Thank you very much, Diego. And good afternoon, and thank you all for joining us. We are coming to you live from San Francisco at the 35th Annual TCT Conference. With me on today's call is our CEO, Bernard Zavigian, and our CFO, Scott Ullum. Also joining us for the Q&A portion of the call are Larry Wood, our group president of TAVR and Surgical Structural Heart, and Devine Chopra, our global leader of TMTT. Just after the close of regular trading, Edwards Life Sciences released third quarter 2023 financial results. During today's call, management will discuss those results included in the press release and accompanying financial schedules, and then use the remaining time for Q&A. Please note that management will be making forward-looking statements that are based on estimates, assumptions, and projections. These statements include, but aren't limited to, financial guidance and expectations for longer-term growth opportunities, regulatory approvals, clinical trials, litigation, reimbursement, competitive matters, and foreign currency fluctuations. These statements speak only as of the date on which they were made, and Edwards does not undertake any obligation to update them after today. Additionally, the statements involve risks and uncertainties that could cause actual results to differ materially. Information concerning factors that could cause these differences and important safety information may be found in the press release, our 2022 annual report on Form 10-K, and Edwards' other SEC filings, all of which are available on the company's website at edwards.com. Unless otherwise noted, our commentary on sales growth refers to constant currency sales growth, which is defined in the quarterly results press release issued earlier today. Reconciliations between GAAP and non-GAAP numbers mentioned during the call are also included in today's press release. With that, I'd like to turn the call over to Bernard for his comments.

Good afternoon, everyone. As Mark said, we are hosting today's call from TCT in San Francisco. I am going to start by covering some of the exciting developments at the conference, share highlights of the significant progress our team has made advancing our strategy, review our strong third quarter results, and finally discuss our confidence in the outlook for Edwards. There are a lot of data being presented this week about technologies Edwards has developed. Included among these are results from three late-breaking clinical trials, all of which reflects Edwards' commitment to generating high-quality evidence to advance innovative therapies for patients suffering from structural heart disease. Yesterday, physicians presented five-year data from the partner-free low-risk pivotal trial. We believe these data demonstrate that TAVR with the SAPIEN platform should continue to be the preferred therapy for treating patients who have severe symptomatic aortic stenosis. After more than 20 years of rigorous clinical experiences and trials, now eight New England Journal of Medicine publications and over a million Patient-treated sapient technology offers patient unique benefits. Sapient 3 has demonstrated 99% freedom from death and disabling stroke at one year, 90% survival at five years, and is the only valve with a THV and THV indication. This is true lifetime management benefit, which expands options for patients. Tomorrow at TCT, we are looking forward to the presentation of a six-month analysis of our evoked trans-catheter tricuspid valve, the first of its kind therapy for the millions of patients suffering from tricuspid valve disease. In addition, tomorrow, you will see the one-year full cohort result of a class 2D pivotal trial with Pascal. We continue to make. meaningful progress to advance our vision of offering a portfolio of innovative transcatheter therapies to treat tricuspid and mitral valve disease. In the last several weeks, we achieved four important milestones in support of our commitment to patient-focused innovation. First, C-mark approval for the EVOC transfemoral replacement system. Second, C-mark approval for the mitrous resilia surgical mitral valve. Third, Pascal precision approval in Japan. Finally, the completion of the enrollment in the first ever pivotal trial for any transfemoral mitral replacement therapy, the encircled trial for sapien M3. Turning now to Q3 financial performance. Third quarter global sales grew 11% to $1.5 billion, led by our differentiated portfolio of innovative therapies. We were pleased with the results, which were in line with our expectations and represent another quarter of double-digit sales growth. For the full year, we continue to expect total company sales growth to be in the 10 to 13 person range. Now I will provide an overview of a third quarter sales performance by product group. In TAVR, we continue to see strong demand for our leading SAPIEN platform with third quarter sales of $961 million up 10% year over year. Our US and OUS sales growth rates were comparable. Our U.S. and O.U.S. competitive positions were stable, and globally, local selling prices were stable. In the U.S., our third-quarter TAVR sales were driven by the continued successful launch of Sapien 3 Ultra Resilia. On the clinical side, we are pleased with the pace of enrollment in our pivotal trial alliance designed to study Sapien X4. our groundbreaking next-generation TAVR technology. In Europe, Edward's sales growth was driven by the broad-based adoption of our SAPIEN platform. We look forward to additional data supporting the Edward's benchmark program to be presented at the PCR London Valves Conference in November. Our sales in Japan grew year-over-year, reflecting a gradual recovery in market growth and strong adoption of sapien-free ultraresilia. Competitive trialling in the third quarter was less pronounced versus in the first half of this year, and as expected, we grew faster than overall posterior growth. Around the world, we remain focused on improving diagnosis and treatment of the many more patients who remain under-treated. In summary, the combination of our global TAVR leadership, along with the data presented at TCT this week, gives the company further confidence in the future of TAVR and the company's expectation of a $10 billion opportunity by 2028. Now turning to TMTT. Our commitment to the unmet needs of mitral and tracheal patients took a significant step forward with the achievement of several important milestones in this past quarter. TMTT third quarter global sales of $52 million increased 65% versus the prior year. This performance was driven by accelerating adoption of our differentiated Pascal Precision platform, the activation of more centers across the U.S. in Europe, as well as tier procedure growth. We continue to be pleased with our excellent clinical outcomes, reflecting the impressive performance of Pascal Precision and the value brought by our comprehensive high-touch models. We are continuing the expansion of Pascal precision globally with the expected launch in Japan before the end of the year. In our mitral clinical trials, we look forward to the one-year class 2D randomized pivotal trial and class 2D registry outcomes with Pascal to be presented as part of a late breaking scientific sessions tomorrow at ECT. This will add to the body of evidence supporting TIER as an effective therapy for patients. With the earlier than expected completion of enrollment in the in-circle pivotal trial for CPNN3, we believe we are one step closer to offering an important valve replacement option beyond TIER to serve even more patients suffering from mitral valve disease. In tricuspid, earlier this month, we received C-mark approval for evoke. We look forward to bringing this new therapy to Europe through a discipline launch that will focus on ensuring excellent patient outcomes. Now, with this approval, physicians in Europe will have access to this groundbreaking option in addition to TIR. As noted, tomorrow at TCT, Late-breaking data from the Tricin-2 pivotal trial of the EVOC replacement technology will be presented on the first 150 randomized patients based on EVOC's FDA breakthrough pathway designation. This landmark presentation on a novel therapy demonstrates our leadership and commitment to innovation and science, and our focus on helping large populations of patients with unmet needs. In summary for TMTT, we are proud of the new therapy introductions, clinical trial achievements, and geographic expansion. We have achieved to advance our vision to build a portfolio of therapies to transform the lives of mitral and tracheal patients. In surgical, third quarter sales of $247 million increase 11%, driven by a balanced combination of strong global adoption of Edward's premium technology and overall procedure growth. We continue to see strong momentum of a Resilia portfolio globally, which has been widely adopted because of the excellent durability of its proven tissue technology, supported by the recent seven-year aortic data and five-year mitral data from our commenced clinical trial. We are confident about the future of this technology as we expand the overall body of Resilia evidence, including ongoing patient enrollment of our momentous clinical study. Finally, we received C-mark approval for our Mitrous Resilia mitral valve earlier this month. We expect to introduce this valve in the fourth quarter, followed by full European launch in 2024. In critical care, third quarter sales of $221 million increased 6%, driven by our smart recovery portfolio with strong adoption of our Acumen IQ sensors equipped with the Hypotension Prediction Index algorithm. We remain confident in our pipeline of critical care innovation as we continue to shift our focus to smart recovery technologies designed to help clinicians make better decisions and get patients home to their family faster. And now I will turn the call over to Scott.