Avinger, Inc. (AVGR) on Q3 2021 Results - Earnings Call Transcript
Operator: Greetings and welcome to Avinger's 2021 Third Quarter Conference Call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. . This conference is being recorded, and it is now my pleasure to introduce Matt Kreps, Managing Director at Darrow Associates Investor Relations. Mr. Kreps, you may begin.
Matt Kreps: Thank you, Paul. And thank you all for joining and participating in today's call. I would like to welcome you to Avinger's third quarter 2021 conference call. Joining us today are Avingers CEO, Jeff Soinski and Chief Financial Officer Mark Weinswig. Earlier today, Avinger released financial results for the third quarter ended September 30th, 2021. A copy of the release is posted on the average or website under our Investor Relations. Before we begin, I'd like to remind you that management will make statements during this call that include forward-looking statements within the meaning of Federal securities blog, which are made pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. Any statements contained in this call that are not statements of historical fact, should be deemed to be forward-looking statements. All forward-looking statements, including without limitation our future financial expectations, are based upon our current estimates and various assumptions. These statements involve material risks and uncertainties that could cause actual results or events to materially differ from those anticipated or implied by these forward-looking statements. Accordingly, you should not place undue reliance on these statements. For a list and description of the risks and uncertainties associated with our business, please see our Form 10-K and 10-Q filings with the Securities and Exchange Commission. Avinger disclaims any intention or obligation except as required by law, to update or revise any financial projections or forward-looking statements, whether because of new information, future events, or otherwise. With that, I'd like to now turn the call over to Jeff.
Jeff Soinski: Thank you, Matt. Good afternoon, and thank you all for joining us. On this Veterans Day, we wish our best and give our thanks to any military veterans listening to our call this afternoon. During the third quarter, we took important steps to advance our strategic initiatives in several key areas. Early in the quarter, we announced the submission of a 510(k) application to expand the clinical indication for Pantheris to include an in-stent restenosis claim, based upon the positive clinical data generated in our in-sight clinical trial. In August, we filed a 510(k) submission for our next-generation Lightbox 3 imaging console. Throughout the quarter, we made significant advancements in the development of 2 new catheter line extensions for our peripheral product portfolio. As we explore opportunities to extend our technology platform into new therapeutic areas, we've also initiated a formal development program for the first-ever image guided CTO crossing catheter for the treatment of coronary artery disease, which we believe could be a transformational opportunity for our Company. While we're pleased with the progress we made in these important strategic areas, the third quarter was challenging as hospitals across the country reduced access and limited procedures due to a surge in COVID cases related to the Delta variant. The impact of these restrictions, along with hospital staffing shortages, was particularly strong in hospital accounts in the southern U.S. a key market area for us. Even with these challenges, we were able to deliver modest revenue growth in the third quarter compared to the prior year quarter, our revenue declined from the second quarter of this year, which had minimal impact from COVID-19 restrictions. There were some positive notes in the third quarter, including the opening of 8 new lumivascular accounts, underscoring the appeal of our value proposition to new users. We've seen this pattern before as the market pullback in response to the original surge of COVID-19 infection in 2020, followed by a recovery in case volumes to propelled us to rapid growth and record results in subsequent quarters. While we continue to feel the effect of the COVID-related restrictions and hospital staffing shortages in the fourth quarter, we believe these limitations will be transient, and that case activity of hospitals will increase as the situation improves in the coming quarters. Our Pantheris next-gen, Pantheris SV and CTO crossing devices including Tigereye fulfill an important need in the market, and there is clear demand for our highly differentiated products. Launching 3 new innovative devices over the past 3 years has enabled us to make inroads into new accounts and secure a greater share of cases at existing users’ sites. Even during the pandemic driven challenges for hospital access. We believe our two newest 510(k) filings will build upon that success and provide the opportunity to accelerate adoption of our technologies in the future. In July, we announced the filing of a 510(k) submission to expand our U.S. label for Pantheris to include the treatment of in-stent restenosis or ISR. With 200,000 stents deployed in the lower extremity arteries annually, and a high propensity for restenosis over a 2 to 3-year timeframe, ISR represents a large and underserved market that will continue to grow as more stents are placed each year. We believe Pantheris provides a significant and exciting competitive advantage in ISR, combining the ability to visualize and direct treatment while avoiding the stent struts, advantage's other devices simply cannot offer for these challenging cases. Our 510(k) submission for the treatment of ISR is supported by positive clinical data from the insight trial, which was designed to evaluate the safety and effectiveness of Pantheris for treating in-stent restenosis in the lower extremity arteries. Insight is a multicenter prospective single-arm trial that was conducted at 17 institutions with 97 subjects enrolled. In October, Dr. John George, a leading interventional cardiologists and endovascular medicine specialist at the University of Pennsylvania Health System, presented clinical data from the insight study at the Vascular InterVentional Advances or VIVA Conference in Las Vegas. Key outcomes presented from the trial included 82% luminal gain, which is the increase in the channel for blood flow following the procedure. 93% of patients were free from target lesion revascularization or TLR, which is an indication of restenosis at 6 months post procedure, and 89% of patients were free from TLR at 12 months. Both results are significantly better than those achieved by laser atherectomy in the EXCITE ISR trial. Dr. George made particular note of the extremely high 12-month freedom from TLR delivered by Pantheris in the insight study and the stability of this endpoint between 6 and 12 months, indicating a long-lasting and durable outcome. 97% of subjects were free of device-related major reverse events at 30 days, indicating the safety of the procedure. And there were no amputations at 6- and 12-months post procedure. Mean ankle brachial index or ABI at 6 months was 0.96, a 39% improvement from the baseline of 0.69 pre -procedure. And there was a 71% improvement in Rutherford Class, a measurement of disease severity at six months with 77% of subjects at Rutherford Class 0 or 1. We're very pleased with this data and excited about what our proprietary system can offer to patients suffering from ISR if approved for the expanded clinical indication. Our second 510(k) submission announced in the third quarter is for our next-generation Lightbox 3 imaging console, which we believe represents a major leap forward for our platform. We filed this 510(k) in August, and hope to receive U.S. pre -marketing clearance by the end of this year. In addition, we've taken the steps required to receive CE marking for the Lightbox 3, so that we can market the new console in Europe and other CE mark countries. We expect to receive CE marking this quarter, and pending approval plan to conduct our first cases with the Lightbox 3 in Germany prior the end of the year. The Lightbox 3's dramatically reduced size and weight provides for increased portability and seamless integration into the Cath lab environment. The Lightbox 3 is designed to fit into a case similar in size to carry-on suitcase and weighs less than 20 pounds, a 90% reduction compared to our current console. The new Lightbox 3 also has improved economics, reducing costs by as much as 50%. In addition to these size and cost improvements, the Lightbox 3 incorporates enhanced capabilities, including an advanced solid-state laser, a more powerful computing platform, and a redesign software system with highly intuitive user interface, which is designed to streamline workflows for practitioners and support increased utilization of our image guided devices. We expect this new platform to accelerate the speed and efficiency of new account acquisition, as well as provide the opportunity to support new catheter capabilities in the future, for both potential peripheral and coronary applications. In addition to these recent 510(k) filings, we are making excellent progress on the development of 2 additional new catheter line extensions for our peripheral product portfolio. As we've demonstrated with our Pantheris SV and Tigereye launches, the introduction of new products to expand our addressable market and bring new capabilities to our platform, has a galvanizing effect on growing our business. Our first new product in development is a line extension of our Tigereye CTO crossing catheter for the treatment of fully blocked arteries. This new device has a spinning out or tip for tough capsen calcium. an advanced shaft designed for push ability and torque response in a challenging environment. And the 3 markers system to facilitate consistent image interpretation across our platform. Our second new catheter product in development is an extension of the Pantheris family of image-guided atherectomy devices designed to provide a more streamlined approach for physicians when treating PAD. This new product is 7 friend sheets combat up compatible and is designed to expand our capabilities for the treatment of larger vessels, 3 to 7 millimeters in diameter. It utilizes a proprietary design for plaque apposition without the need for a balloon and is designed to operate at higher rotational speeds and challenging plaque. This new Pantheris line extension also adds rotational control for efficient guidewire management and a modified plaque management system for tissue packing and removal. We're excited about these 2 new devices which have the potential to expand our product line to a wider group of physicians and streamline procedural efficiency. We expect to complete development for both devices over the next few months, and file for regulatory clearance in the U.S. and CE Mark countries in the first half of 2022. If all goes according to plan, this will provide the opportunity for us to receive pre -marketing clearance and launch both devices into the U.S. and international markets next year. While we've continued to make important advances in our peripheral portfolio, expanding our technology to new markets is critical to our long-term growth opportunities. Our first foray is into the coronary artery disease market, and our initial area of focus is to extend our proprietary image guided platform to crossing CTOs in the coronary arteries on a less invasive percutaneous basis. We believe this could be a transformational opportunity for Avinger that would significantly increase the addressable market for our products, and change the standard of care in a clinically challenging and largely underserved market. It's estimated that approximately 50,000 CTOPCI procedures are performed in the U.S. each year, while the number of hospital centers performing these procedures as growing, CTOPCI crossing continues to be a highly complex and challenging procedure, requiring specialized and demanding technique with a steep learning curve, The use of multiple devices and significant time under fluoroscopy, which results in high x-ray radiation exposure and contrast burden. In addition, an estimated 200,000 plus highly invasive coronary artery bypass grafting, or cabbage surgeries are performed in the U.S. annually with estimates of up to 30% of these procedures related to the treatment of coronary CTOs. This creates a sizable and growing market that we believe is right for expansion with proprietary new tools that would make a percutaneous approach more accessible, and reduce the need for extended time under fluoroscopy radiation. High reimbursement of $10 to $16,000 per procedure is already in place for CTOPCI in the U.S. In addition, we anticipate that our OCT guided catheters with their high-resolution imaging and anticipated diagnostic and measurement capabilities would qualify for existing OCT diagnostic imaging reimbursement in the coronary arteries. We believe that an image guided catheter designed for crossing efficiency and the need for fewer support devices, combined with an attractive reimbursement scenario provides the opportunity for a highly positive clinical and economic value proposition. Augmented by the learning with our CTO crossing catheters and peripheral arteries, we've made good progress on our initial development efforts for the first image guided CTO crossing device for the treatment of coronary artery disease. Our development efforts are focused on catheter designs that combine really real time OCT guidance with precise control and steerability to allow physicians to safely and efficiently cross CTOs, while avoiding damage to the vessel wall. We're designing our first coronary CTO catheter in a low profile for french size to provide for accessibility and maneuverability in small coronary vessels. Similar to our peripheral catheters, our coronary devices are expected to incorporate a precise measurement capability, ideally suited for physicians to properly size balloons or stent prior to placement, which is critical for optimal outcomes. We anticipate the U.S. regulatory pathway for this new device to be a 510(k)-submission supported by data from an IDE clinical study. We expect to complete product design for our first coronary device in 2022 with the goal of conducting a clinical study in 2023 to support our regulatory submission. As we reflect on our experience this year and look to the future, we saw significant growth in the first half of the year as case volumes returned to normal following the initial waves of COVID-19 infection in 2020, and widespread vaccinations being made available throughout the U.S. With the recent resurgence of COVID-19, our business was impacted negatively. As market conditions improve in our new products and clinical indications come online, we expect to return to more accelerated pace of growth. We have the best product catalog in our history and have grown revenue for our Pantheris family of atherectomy catheters by greater than 250% over the past 3 years. Pantheris SV our small vessel catheter has been a major growth driver for the Company, extending our reach to the treatment of below the knee or BTK lesions. Tigereye has reinvigorated our image guided CTO franchise, and expanded our share of the approximately $100 million peripheral CTO market. We've now sold Tigereye to more than 50 sites. With the edition of Tigereye, our combined CTO sales have grown by 67% in the first 9 months of this year, compared to the same period in 2020. We've made tremendous strides in developing our portfolio and are excited about the potential of our new product development efforts, including the exciting opportunity to expand our platform to coronary applications in the future. As we drive growth across our primary product lines, add upside opportunities from our Lightbox 3 and ISR indication, and develop new products to expand our addressable market, we provide new growth opportunities for the Company, and most importantly, empower physicians to provide the best possible care for their patients with the most -advanced therapeutic devices on the market. At this point, I would like ask Mark to cover our financials, and I'll return for Q&A. Mark.
Mark Weinswig: Thank you, Jeff. Total revenue for the third quarter of 2021 was $2.4 million, a 3% increase from the year-ago quarter. Third quarter revenues reflect the impact of hospital access limitations, primarily due to a surge in COVID-19 cases in a number of large markets that Avinger serves, particularly in markets located in the Southern U.S. We are working closely with our sites to support procedural needs, and maintain readiness to treat patients when hospitals return to more normal procedure levels. Third quarter 2021 catheter sales increased 5% year-over-year, as we continue to focus on increasing utilization, with strong market interest in our Pantheris SV and new Tigereye CTO catheter. Growing our recurring disposable revenue streams continues to be a core element of our commercial strategy. Gross margin in the third quarter was 34%, similar to the third quarter of last year. Avinger's contribution margin from incremental sales of disposable products is far higher than our reported gross margin, providing important leverage in our operating model as we scale the business to drive more revenues. Operating expenses for the third quarter were $5.3 million compared with $4.9 million in the year-ago period. We're continuing to make investments in expanding our product offering, including our new Lightbox and next-generation catheter solutions, supporting our commercial sales team and funding clinical programs, which we believe will provide avenues for growth. As Jeff discussed previously, we believe these new products are key to our future success. Net loss attributable to common shareholders was $6 million in the third quarter compared with $5.5 million in the third quarter a year ago. Adjusted EBITDA, which is a non-GAAP measure that excludes certain excess and obsolete inventory charges, depreciation and amortization expenses, stock compensation, and other items as noted in the tables in today's press release, with a loss of $4.1 million compared with a loss of $3.5 million in the year-ago period. A copy of the reconciliation from net loss to adjusted EBITDA can be found in today's press release, which is also posted on our website at www. avinger.com under the Investor section. Cash and cash equivalents totaled $23.1 million, down from $26.7 million at June 30th. We believe our cash position is sufficient to fund new product development, our commercial efforts, and clinical plans through 2022. At this point, I'd like to turn the call back to Jeff for Q&A.
Jeff Soinski: Thanks, Mark. The third quarter saw continued positive momentum on our strategic initiatives, including the announced filings of two new 510(k) submission, the significant progress on our new catheter products expected to be released commercially next year, and the stabilization of our commercial efforts in the face of the COVID-19 resurgence. We're focused on executing our strategy to build that value for Avinger stockholders by driving meaningful growth of our business and fulfilling our mission of radically changing the way vascular disease is treated. At this point, we'd be happy to take your questions.
Operator: Ladies and gentlemen, the floor is now open for questions. . Please hold while we pull for questions. And the first question today is coming from Marc Weisenberger from B. Riley Securities. Marc your line is live.
Marc Weisenberger: Thank you, good afternoon. I'm wondering if you could talk about procedure dynamics across the different geographies as the Delta variance surged, and is it possible to isolate procedures in progress in markets that were either unaffected or less affected by COVID, and how did those do?
Jeff Soinski: Thanks for the question, Mark. As we said in our statement, and as we've heard in the reports from other companies, the markets that we're hard as tit, we're in the south, and especially of the Southeast, the deep south where the infection rates were highest. And that led to challenges in the hospital setting, both due to limitations on elective procedures through requirement to hold hospital beds for potential COVID patients, and also increased testing and other criteria for a patient to be admitted to the hospital, even for an outpatient procedure. This was all exacerbated, especially in those markets by hospital staffing shortages. So, we saw key markets in Louisiana, Arkansas, certain places in Texas really had at a more significant level than other markets in the north. It becomes really a market-by-market, state-by-state. The shortfall in our business was primarily driven in those markets which typically are responsible for about 50% of our business, the southern markets. We are seeing those markets start to pick up. We are hearing about and still feeling the effect of COVID in markets across the country and are hearing reports of increased levels of infection now starting to hit certain areas in the Northeast, and I think there's an anticipation over the winter months. So, it's very hard to forecast. But there are definite markets of real strength that had been less impacted and markets that had been more impacted. I'd also say that the hospital is generally more impacted by the OBL. And so, we're really pleased with how our business held up and how well we fared versus even other companies with large peripheral concentration over this past quarter, given that over 80% of our business is in the hospital market.
Marc Weisenberger: Very helpful. In your prepared remarks, you talked about how in prior episodes with COVID surges you were able to bounce back pretty strongly. However, this time you have talked about some of the staffing shortages, not only clinical, but some primary care and referral shortages, maybe that kind of filter through the entire chain. I'm wondering how you think the subsequent bounce back will be impacted by these labor dynamics that are new relative to earlier episodes?
Jeff Soinski: Yeah, it is a new -- I think a new dynamic that we're dealing with, right? All of us in this industry and this market. I am reluctant to predict how quickly that will change. As I said, we are seeing an improvement in key markets related to available procedure time, more Cath labs being open, some elective procedures coming back, but the staffing shortages I think are still a very real issue and it will be very hard for me to predict how we work -- how the industry works through that.
Marc Weisenberger: Got it. Okay. And I believe there were some recent OBL physician fee changes? Wondering how you think that might affect your hospital business going forward?
Jeff Soinski: Yes, it was an interesting past few month as it relates to reimbursement. And what you are referring to for those on the call who aren't as familiar as you are, is the CMS published the final position fee schedule for 2022 recently, and what that included was a 15% reduction for in atherectomy procedures in the OBL, the office space lab setting, versus 2021. Hospital reimbursement we anticipate to remain very strong. Now, the 15% reduction in the OBL was significantly better than the 22% reduction initially proposed. However, CMS indicated that reimbursement levels will continue to decline in the OBL over a 4-year transition period. Now again, we're less impacted since over 80% of our business is in the hospital market. We do expect, however, that this reduction and the continued reduction in OBL pricing will continue to put more price pressure on devices for the OBL market. And while it's obviously way too soon to say what the impact will be, that's reimbursement in the OBL continues to decline that could keep more procedures in the hospital setting, which would not be a bad thing for Avinger in the long run. So, I guess the other reimbursement moves that happened over the past couple of months, as you might be aware, that the AMA CPT panel had an item on their agenda for the September, October meeting related to a comprehensive review of the lower extremity revascularization codes. This is an agenda item that have been postponed from an earlier meeting. And then during the September, October CPT panel meeting, it was again postponed indefinitely. So, we see this as an indication that there won't be significant changes to the lower extremity codes in the near future, and most analysts and companies that we're tracking don't anticipate that any new codes will be established until 2024 at the earliest. So, the net of this is that we expect hospital reimbursement to remain really strong, OBL reimbursement has been reduced but not at the as high a level that had been potentially anticipated, and it will continue to be an evolving story.
Marc Weisenberger: Very helpful for all that color, just final one for me. I know you had plans to continue to expand the sales force and drive growth. Wondering how the labor dynamics are impacting you there and how we should think about sales force expansion into the end of the year and the early part of '22? Thank you.
Jeff Soinski: Yeah, no, thank you for the questions, Marc. So given the challenges presented by the pandemic, we've stabilized our sales headcount and are not planning on adding significantly to the group, at least through the end of the year. As the market works through the current challenges and we start to see case volumes return to more normal levels, we'll resume our efforts. We anticipate obviously in 2022 to build the commercial team. But we have stabilized where we are and don't expect significant expansion in the near-term.
Marc Weisenberger: Got it, very helpful. Thank you.
Jeff Soinski: Thank you, Marc.
Operator: Thank you, And the next question is coming from Nathan Weinstein from Aegis Capital. Nathan, your line is live.
Nathan Weinstein: Thank you. Hi Jeff and Mark and thanks for taking my question.
Jeff Soinski: Hi, how you doing Nathan? Nice to talk to you.
Nathan Weinstein: Likewise, thanks so much. Okay, so one of the more exciting things about Avinger, I think most would agree is the Company has really proven itself to be an engine of innovation, and the product bag really feels like it's starting to hit critical mass, so maybe you could share with us a sense of the timing and when you see a lot of these cross-sell opportunities come together that could maybe drive a higher inflection in the growth rate?
Jeff Soinski: Great, yes, thanks for the question. When you look at the number of milestones and the activity coming up over the next few quarters, it's pretty exciting. Starting with the ISR 510(k) which is not, as you know, a new product, but it is an expanded clinical indication that we will treat as a new product launch when we get the allowance. Based on how the review process is going and the strength of our submission, including how strong the data is from INSIGHT, we're hopeful that we'll receive that clearance in the not-too-distant future and that will be exciting for us because it not only is highly differentiating, but it will allow our sales force to directly promote Pantheris for treating in-stent restenosis. And the data from that study which I outlined was so positive, especially compared to the only other major study that had been done in the treatment of in-stent restenosis with atherectomy EXCITE ISR for laser atherectomy. And it's really important to note that we will be the only directional atherectomy product that has this claim. In fact, the only other directional atherectomy catheters, non-imaging atherectomy catheters that are marketed by Medtronic, the Hawk Family are actually counter indicated for ISR. So, we see the ISR claim, which we are hopeful will still happen this quarter, as a way to expand utilization in existing accounts, and also a way into new accounts. So that's one big important step forward and we've invested quite a bit in clinical work and preparation for taking good advantage of that claim and the strong clinical data. The next milestone we have coming up is CE Marking for our new Lightbox 3, we expect to receive that pretty confidently this quarter, and we're preparing to have our first cases in Germany this quarter as well at two important KOL sites. And so that will provide an opportunity for us to get our first real-time case experience with the Lightbox 3, which as you know, Nathan, since you followed us for a while, is part of our process to prepare for our U.S. introduction and launch. So, we're hopeful again that we will receive the Lightbox 3 clearance prior to the end of the year or at least sometime early in 2022, and that will allow us to initiate a limited launch in the U.S. likely in the first quarter of 2022, where we can get experience, train our sales force, start to understand how to best transition to this new imaging console, and take advantage of the many benefits it provides, especially as it relates to new account acquisition and efficiency in a case. And so that should be an early '22 milestone. Coming on the heels of that, we have 2-line extensions of our peripheral portfolio in development, we have our Tigereye product which has a spinning tip and other improvements and developments related to the treatment of tough caps and calcium. And we have our Pantheris line extension, our larger vessel device for the SFA and popliteal that we believe will have a significantly streamlined procedure by no longer -- or by not requiring a balloon for plaque acquisition. We expect to file 510(k) applications and these again, to underscore, would be line extensions, not replacements of current devices, so the whole idea here is to expand our usage base. But we expect to file 510(k) and CE marks for both of those products in the first half of next year. Given our track record, we expect that that will lead to clearance; first case is in Europe and ideally commercial launch in the second half of 2022. And then, in addition to the peripheral products, we shared some information today on the really what we believe is an extremely attractive opportunity to take our image - guided approach to the coronary arteries. In many ways, I feel like all of the work we've been doing up to this point has really prepared us for this. We see a major market opportunity to cross -- to enable more physicians to safely and efficiently cross CTOs in the coronary arteries on a percutaneous stasis, we have brought an additional resource to help us with that, we are making good early progress and we expect to complete our design phase in 2022, which we are hopeful will prepare us and enable us to begin enrollment in the clinical trial in 2023. Again, we think the regulatory route there will be a 510(k) but that a clinical trial will be required. But that's a very big exciting opportunity for us, the reimbursement is already very strong, CTO specific reimbursement for CTOPCI crossing. There is already OCT diagnostic reimbursement in the coronary arteries, so a very exciting clinical and I believe economic value proposition. And then in addition to the product development efforts, we are still enrolling in our image BTK study that had slowed down a bit because of the new resurgence of COVID infection, but we do expect to complete enrollment and have at a minimum our 30-day data release in 2022, and hopefully and I would imagine we will have at least a large cohort of 6-month patients prior to the end of the year. So again, bringing new data in a market that is hungry for data. I mean, we as a small Company have invested quite a bit in well-designed clinical trials with meaningful clinical outcomes and data. And then I guess the other backdrop for '22 is now that insight has wrapped up, we will be working with the principal investigators on publication in peer review journals of those results, and there's a lot of great information that we're excited to get out to the market in a peer review journal. So, a lot going on, we're busy here. And, of course, all of this in the backdrop of continuing to address opportunities in the commercial markets, continuing to sell catheters, get more and more catheters used all the time, and most importantly, help our physicians do a great job and deliver outstanding outcomes for their patients.
Nathan Weinstein: That's fantastic. Thanks so much for the helpful color on all of that, Jeff. And just one follow-up, if I may. You've discussed several exciting initiatives, including the line extension products, but I just couldn't help but notice that OPEX overall and in particular the R&D spend has been trending down sequentially in year-over-year, so just curious, is that a sign that the organization is working at increasing efficiency? Or how do we think about the R&D side.
Mark Weinswig: Yeah. Thank you for the question, Nathan. So, if we look at our R&D spending, that also includes our clinical studies work. As we noted, the vast majority of work on the Insight study was completed in the first and second quarter of this year, and so the reduction that you saw in the third quarter was primarily due to that. We actually did expand a little bit in terms of some increased spending because we have actually started this new development opportunity on the coronary program, and that is -- and we are putting some investments in there. You should expect to see our research and development costs tick up slightly through the end of this year and also into next year as we continue to put more and more efforts into expanding that research and development program.
Nathan Weinstein: Great. Thanks again, Jeff and Mark, for taking my questions, and we look forward to continued progress in the business ahead.
Operator: Thank you. And there are no remaining questions in queue. I will now turn the call back to Jeff Soinski for closing remarks.
Jeff Soinski: Well, thank you for joining our call this afternoon. We very much appreciate your interest in our Company. We appreciate your support, and look forward to reporting our continued progress in our year-end call. Thank you.
Operator: Thank you, ladies and gentlemen. This does conclude today's conference. You may disconnect at this time, and have a wonderful day. Thank you for your participation.
