ARTIVION, INC.(AORT)Q2 2026 法說會逐字稿

Good afternoon, and welcome to the Artivion Second Quarter 2026 Earnings Call. As a reminder, this conference is being recorded. I would now like to turn the conference over to Brian Johnston from the Gilmartin Group. Thank you. You may begin.

Good afternoon, and thank you for joining the call today. Joining me from Artivion's management team are Pat Mackin, CEO, and Lance Berry, 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 that 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 Artivion's 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 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 on the adjusted constant currency rates, and expenses as a percentage of sales will be based on adjusted revenues. With that, I'll turn the call over to Artivion CEO, Pat Mackin.

Hey, thanks, Brian, and good afternoon, everybody. Through the second quarter of 2026, we continue to execute on our strategy designed to drive long-term profitable growth through an expanding and clinically differentiated product portfolio. We delivered total constant currency revenue growth of 9% and adjusted EBITDA growth of 7% over prior year. Revenue growth was again driven primarily by On-X and stent grafts, including AMDS. Before expanding further on product line performance, I want to take a moment to address two milestones that we were most focused on coming into this year and recently achieved. In late June, we received U.S. FDA approval for the PMA for our AMDS hybrid prosthesis in line with our previously communicated expectations. The third quarter will be the first full quarter in which AMDS is sold in the U.S. under the full PMA. That is meaningful because PMA approval obviates the lengthy IRB review process in new accounts that previously had to work through, and we expect to accelerate new account conversion and set sales going forward. We were also pleased to complete the acquisition of Endospan and its NEXUS Aortic Arch Stent Graft System during the second quarter, again ahead of the timing we had anticipated. This acquisition completes our market-leading, three-pronged aortic arch portfolio. We believe this technology, alongside AMDS and Arcevo, positions us at the forefront of this segment as the only company globally with a complete portfolio of aortic arch solutions. Importantly, NEXUS is a platform technology, not just a single product. It supports three additional PMA programs in development that we expect will further extend and solidify our leadership in the aortic arch market over time. As it relates to NEXUS, our message here is consistent with last quarter. Through 2026, our focus will be on building inventory, working through Value Analysis Committees, and augmenting our U.S. sales team. We continue to expect a full U.S. commercial launch of the NEXUS system in January of 2027. As a reminder, the device is approved to treat chronic aortic dissections, which represents about a $100 million market opportunity. With that, now let me turn to the second quarter results. From a product category perspective, stent graft revenues grew 12% on a constant currency basis in the second quarter compared to the same period last year. This is an acceleration from the 10% growth we reported in the first quarter and came against a tougher year-over-year comparison, so we're encouraged to see this progress. Importantly, one of our key areas of focus coming out of the first quarter was on AMDS set sales. We were pleased to see improvement in set sales relative to the first quarter with implant trends also remaining strong. As we said last quarter, we view implant reordering as the most critical indicator, as strong reordering patterns reflect positive user experience and ultimately longer-term adoption and higher growth. Looking ahead, we expect U.S. AMDS set sales to further accelerate following the recent AMDS PMA approval, and as the barriers associated with the initial upfront $100,000 investment associated with the stocking continue to wane. Ultimately, we see our comprehensive stent graft portfolio as a foundational component of our growth strategy. We are encouraged by our enduring fundamental strength and increasingly strong competitive advantages within this segment. Turning to On-X, our second quarter On-X revenues grew 18% year-over-year on a constant currency basis. This growth was again driven by global market share gains in the newer U.S. opportunity unlocked by data showing improved outcomes with mechanical versus bioprosthetic valves in younger patients, and it also came against a much tougher year-over-year comparison than in prior quarters. The data supports our conviction that the On-X valve is the best aortic valve on the market for patients under the age of 65. Meanwhile, tissue processing came in slightly ahead of our expectations, generating approximately $26 million in revenue, representing an increase of 1% year-over-year on a constant currency basis against a challenging comp due to recovery from the 2024 cyber incident in Q2 2025. We had a strong finish to the quarter in terms of tissue releases resulting in some volume we might otherwise have expected in the third quarter shifted into the second quarter. Overall, we remain on track with our expectations. I also want to briefly highlight the Ross procedure data that was recently published in JACC, the Journal of the American College of Cardiology. The study reported a 12-year outcome of 455 adult Ross procedures that were performed at a single high-volume center. This study provides compelling long-term evidence regarding the performance of our proprietary SynerGraft pulmonary valve. The results were outstanding. With survival compared to the age-matched general population, the autograft re-intervention rate was 1%, and the pulmonary homograft intervention rate was less than 2% at 12 years. As a result, the overall re-intervention at 12 years was about 3.5%. Importantly, 95% of the pulmonary homografts implanted in this study were Artivion SynerGraft valves. These results further reinforce SynerGraft's differentiated clinical profile and market leadership. We believe this level of long-term clinical evidence is unmatched in the pulmonary homograft market and strengthens physician confidence in the Ross procedure as well as our product. Collectively, these data reinforce our conviction that supply, not demand, continues to be the primary constraint in growth for this segment of our tissue business. Finally, BioGlue revenue declined modestly in the quarter on a constant currency basis. As we discussed last quarter, this product line carries a meaningful amount of stocking distribution business, which creates normal quarter-to-quarter variability, and we continue to expect mid-single growth for BioGlue over the full year. Lastly, on our pipeline, we continue to make progress on the ARTISAN Clinical Trial for Arcevo LSA product. We've now enrolled 30 patients in the trial, which is a non-randomized clinical trial up to 132 patients in the U.S. and Europe at 30 centers, for the treatment of aortic dissection and aneurysm in the arch. We anticipate completing enrollment in mid-2027. We are optimistic the trial will be successful, based in part on the positive clinical results from our current generation frozen elephant trunk, E-vita OPEN NEO, outside the U.S. Following a 1-year follow-up period and assuming the trial meets its endpoints, we anticipate FDA approval for Arcevo in 2029, unlocking an incremental $80 million of annual U.S. market opportunity. In conclusion, the second quarter was a quarter of meaningful progress against our long-term strategy. We delivered the AMDS PMA approval we had targeted for nearly a year. We completed the NEXUS acquisition ahead of schedule. Stent graft revenue accelerated against a tougher comp. On-X continued to take share, and our preservation services business is growing, constrained generally by supply, not demand. The fundamentals that underpin our growth strategy remain exceptionally strong: a comprehensive, clinically differentiated portfolio, a focused commercial organization, and a pipeline that stands to expand our total addressable market over time. With that, I'll now turn the call over to Lance.

Thanks, Pat, and good afternoon, everyone. Before I begin, I would 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 constant currency unless otherwise noted. Total revenues were $125.8 million for the second quarter of 2026, up 9% compared to Q2 of 2025. Meanwhile, adjusted EBITDA increased approximately 7% from $24.8 million to $26.4 million in the second quarter of 2026. Adjusted EBITDA margin was 21% in the second quarter of 2026, an approximately 90 basis point decrease from the prior year, primarily driven by the anticipated increased investments in R&D, including investments in the NEXUS pipeline following the acquisition of Endospan. From a product line perspective, stent graft revenues increased 12%, On-X grew 18%, tissue processing revenues grew 1%, and BioGlue revenues decreased 2% in the second quarter of 2026. On a regional basis, revenues in North America increased 8%, EMEA increased 10%, Asia Pacific increased 9%, and Latin America increased 11%, all compared to the second quarter of 2025. Overall, we were pleased to see a return to growth across international markets. Q2 gross margins were 64%, a decrease from 64.7% in the second quarter of 2025 as favorable pricing was more than offset by unfavorable geographic mix and some higher costs in our Austin facility as we incur early costs associated with ramping production. General, administrative, and marketing expenses in the second quarter were $79.8 million compared to $57.7 million in the second quarter of 2025. Non-GAAP general, administrative, and marketing expenses were $60 million or 47.7% of sales in the second quarter compared to $53.4 million or 47.2% of sales in the second quarter of 2025. Approximately 90 basis points of year-over-year improvement was driven through leveraging existing infrastructure and annualizing our year 1 U.S. AMDS launch cost, while absorbing costs associated with the acquired Endospan business, which was more than offset by approximately 90 basis points of deleverage from increased stock-based compensation and approximately 40 basis points of deleverage from increased amortization expenses following the acquisition of Endospan. R&D expenses for the second quarter were $9 million or 7.2% of sales compared to $7.1 million or 6.3% of sales in the second quarter of 2025. Interest expense net of interest income was $6.9 million as compared to $7.2 million in the prior year. Other income and expense this quarter included foreign currency translation losses of approximately $700,000. Free cash flow was negative $12 million in the second quarter of 2026 as compared to positive $11.7 million in the second quarter of 2025. This quarter's free cash flow was impacted by $1.5 million of Endospan related diligence and integration expenses and a $10.2 million payment by Endospan as a result of the acquisition for contractually required transaction bonuses. This cash payment was funded as part of the planned $135 million purchase price, but was required to be reflected for accounting purposes as a post-acquisition expense and a free cash outflow. The remaining free cash flow is relatively neutral as anticipated as we invested in our On-X manufacturing facility, cost to run the acquired Endospan business, and the U.S. NEXUS launch. As of June 30, 2026, we had approximately $77.3 million in cash and $363 million in debt, net of $6.6 million of unamortized loan origination costs. At the end of the second quarter, our net leverage ratio was 3.1, reflecting the impact of the recent $150 million of borrowings drawn to primarily fund the Endospan acquisition. Note that the $25 million AMDS PMA milestone payment was paid in July and is not included in the 3.1 leverage ratio for Q2. And now for our outlook for 2026. Overall, we are pleased with our Q2 performance as we saw an acceleration in stent graft revenue and strong On-X growth, both against difficult comps and a return to growth across all international geographies. This combined with the AMDS PMA approval leaves us more confident in our ability to deliver our previously outlined guidance. We continue to expect adjusted constant currency growth between 7% to 11% for the full year, representing a reported revenue range of $480 million to $496 million. This guidance contemplates FX to have an approximate 1 percentage point tailwind on as reported revenue for the full year. As a reminder, this guidance assumes inconsequential revenue from the U.S. NEXUS sales in 2026 as we seek Value Analysis Committee approvals and build supply for an anticipated January 2027 U.S. launch. We also continue to expect a difficult comp for the preservation services business in Q3 before normalizing in Q4. Additionally, as Pat discussed, we had some upside in preservation services in Q2, but that was primarily timing between Q2 and Q3. Outside of that business, we continue to expect sequential improvements through the back half of the year as our U.S. AMDS and U.S. On-X sales accelerate. With these revenue expectations and including the impact of the Endospan acquisition, we are reiterating our full year 2026 adjusted EBITDA to be in the range of $92 million to $99 million. As a reminder, this guidance included our expectation to incur approximately $8 million of expenses associated with the acquisition of Endospan through 2026 associated with investments in launch costs and commercial infrastructure while also accounting for the absorption of Endospan operating costs, including ongoing R&D and clinical expenses. Looking forward, we would expect the first meaningful revenue contribution for NEXUS to begin in January 2027 and would anticipate our combined results to be EBITDA neutral for the full year 2027 as U.S. NEXUS revenue ramps over the course of the year as we get combined R&D and clinical spending into a targeted range of 7% to 8% of sales. With that, I will turn the call back to Pat for his closing comments.

Thanks, Lance. Overall, we're very pleased with our Q2 performance following a challenging start to the year. With NEXUS and AMDS, we have a strong conviction in our longer-term growth outlook. We continue to build our broader market expansion pipeline, particularly with the ARTISAN Trial enrolling on schedule. More specifically, we believe that future growth will be driven by four primary U.S. aortic growth platforms, which collectively represent about $430 million in annual U.S. market opportunity today, with additional upside from our expanding innovation pipeline. First is the AMDS PMA. We're seeing strong early commercial momentum with AMDS. Following the U.S. PMA approval this past quarter, we expect accelerating adoption as we expand access to the U.S. market. This represents about a $150 million annual opportunity in the U.S. Second, On-X heart valves. We continue to educate physicians on the compelling clinical data demonstrating improved survival and lower re-operation rates for patients under 65 years old compared with bioprosthetic valves. We believe this data will continue to drive greater global adoption and market share gains for On-X, representing an estimated $100 million U.S. market opportunity. Third, NEXUS. We're excited to acquire the NEXUS platform following its FDA approval earlier this year. In addition to providing an estimated $100 million annual U.S. market opportunity, the acquisition positions Artivion as a leader in the aortic arch repair market and significantly strengthens our innovation pipeline with three additional PMA programs currently in development. And fourth, the ARTISAN IDE trial. We continue to make excellent progress enrolling in the FDA IDE trial called ARTISAN for our next generation frozen elephant trunk platform. We believe this technology represents an additional $80 million U.S. market opportunity and further expands our long-term growth runway. Finally, I want to thank all of our employees around the globe for their continued dedication to our mission of being a leading partner for surgeons focused on aortic disease. So with that, operator, please open the line for questions.

The first question is from Bill Plovanic from Canaccord Genuity. We have made excellent progress enrolling in the FDA IDE trial called ARTISAN for our next-generation frozen elephant trunk platform. We believe this technology represents an additional $80 million U.S. market opportunity and further expands our long-term growth runway. Finally, I want to thank all of our employees around the globe for their continued dedication to our mission of being a leading partner for surgeons focused on aortic disease. So with that, operator, please open the line for questions.

It's Zachary on for Bill. Q2 revenue beat by a nice bit. Why not raise the guidance? What does it imply for the back half of the year, more specifically on product line, especially with some of the drivers you have, AMDS getting approval?

Yes, so a couple of things. We're really pleased with the Q2 performance. Obviously, we got the PMA approval for AMDS and we closed the Endospan transaction. But both of those were contemplated in our previous guidance. At the time of the Q1 call, we had a very high degree of confidence in both those things. Beyond that, if you look at Q2, the preservation services, we had a great quarter. It was probably about $2 million above our targeted expectations. But a lot of that was due to really strong releases toward the end of the quarter that moved some revenue that would have been in Q3 into Q2. Lastly, stent grafts accelerated revenue growth despite a much tougher comp, and On-X was actually even slightly higher growth in Q2 despite a much tougher comp, which is great. All that gives us more confidence in our ability to deliver that guidance. Coming off of what was a pretty challenging Q1, we felt it was prudent to maintain some conservatism until we get a little further in the year, and it's really nothing more than that.

Got it. And then for my follow-up, if you don't mind, can you quantify or provide some relative scale to the number of accounts currently with AMDS on the shelf and those either in VAC approval or purchasing of inventory? I know that there were some headwinds before about AMDS being in HDE and some accounts are waiting until we got the PMA to adopt it. Just any comment on that.

We've not really given a lot of details on those other than that initial quarter after we launched, we gave some comments. We did make good progress in Q2 and had an improved performance on set sales and new account openings in Q2 as compared to Q1. So we will say that. Pat, do you want to give some qualitative comments on AMDS in Q2?

We clearly haven't given account level detail and we're not planning on doing so anytime soon, but we have said for a while that this PMA is a big deal. It allows us to be more aggressive with marketing. We brought the whole commercial team back in July for a sales training meeting. It was fantastic. Our messaging—no longer having to go through the IRB or deal with the HDE—will set us up well for the back half.

The next question is from Suraj Kalia from Oppenheimer.

This is Shaymus on for Suraj. Just to start, Pat, can you talk a little bit more about AMDS? I think you said something along the lines of the $100,000 set price, you're seeing that barrier waning as you go on. Just trying to understand a little better what happened in Q1 and what has changed now that we obviously have PMA approval, but obviously that $100,000 price didn't change. So why was it a barrier before and why is it not so much now?

Through 2024 and 2025 with the HDE, we tracked sets and implants every quarter. Q1 of 2026 was the first time we missed our expectations. Predicting timing is challenging because these decisions are external to us. We had a number of accounts that had IRB approval or VAC approval but were waiting on a PO because it's uncommon for a hospital to write a check for $100,000 upfront. We spent a lot of work in Q2 understanding the barriers and have programs set up to address those issues. We've gotten our arms around what it takes to open accounts and drive adoption. We're very excited about the PMA. It will take time to roll out but we are very bullish on the second half.

Got it. And then thinking ahead about January when NEXUS is launched, how are you balancing the salesforce selling new products along with legacy products to make sure nothing slips?

We have a U.S. commercial team of about 60 people focused heavily on aortic cardiac surgeons—On-X, AMDS, and the SynerGraft pulmonary valve. These are the same customers with existing relationships, so it's about driving messaging into those accounts. NEXUS is primarily with vascular surgeons in the large accounts, so we're building a small dedicated vascular commercial team to work with our cardiac team, since cardiac and vascular surgeons often collaborate. The NEXUS opportunity is concentrated—probably 150 target centers—so a small team can cover the implants. Our cardiac team has been through Value Analysis Committees in many accounts and has developed a playbook, so there's a lot of synergy between the cardiac and vascular efforts. The NEXUS universe is small enough for focused coverage.

The next question is from John McAulay from Stifel.

It was clearly a positive, busy quarter on the aortic side of things with NEXUS officially acquired and getting the PMA for AMDS approved. Quick question on both items: can you talk more qualitatively about how conversations with customers have changed since approvals? Could revenues accelerate in the back half of the year? And on NEXUS, curious on progress on integration, rep hiring, and getting the device ready to scale manufacturing.

On NEXUS, we've been partnering with Endospan since 2019, so integration has gone extremely well. We've brought over the majority of their team and are aligned on delivering breakthrough technology to the aortic arch. There's a built-in delay for Value Analysis Committee approvals, so we're using that time to build inventory, hire reps, and train surgeons, targeting a January 1, 2027 launch. We will do some ad hoc cases before year-end. On AMDS, training meetings with surgeons highlighted confusion around the HDE and IRB requirements. Removing that friction and communicating our positive reimbursement story—new DRG 209 for Medicare and payer information—has been important. We've tightened up our messaging on both reimbursement and clinical data now that we have the PMA, and we're encouraged about the back half.

Got it. Looking a bit ahead to 2027, with a NEXUS launch and rep hiring, how should we think about the top line and EBITDA given investments and ramp? Any initial thoughts?

It's a bit early, and we usually provide directional comments on the Q3 call. Directionally, we will need to invest on the commercial side for reps and surgeon training. NEXUS requires more intensive training, but its accounts are concentrated and we don't need a large sales force for 2027. There will be some investment, but not significant. The rest of our business model remains strong; taking Endospan costs and revenue into account, the underlying business can generate leverage and revenue growth. We'll provide more detail on Q3 when we're closer to 2027.

The next question is from Keith Hinton from Freedom Capital Markets.

Yes, I have a question on AMDS regarding what things have looked like since approval. Should we think about this as rebuilding the pipeline with full license to commercialize, or is there a warehousing effect where some accounts were ready and we could see a step change upwards?

We've said not to expect a giant bolus immediately upon PMA approval. We're only a month into the quarter and that's as expected. The PMA removes friction in moving accounts through the process to make the $100,000 investment. It also allows broader marketing messaging than under the HDE, which should help with both setting up new accounts and driving adoption. Directionally it's positive, but don't expect a sudden avalanche immediately post-PMA.

Okay, great. And on preservation services: one competitor reported supply issues on the cardiac side. Did you see any upside from that in the quarter? And when building the vascular sales force for NEXUS, are there synergies with vascular tissue where you have less presence?

I don't have competitor-level detail, but the JACC publication I mentioned shows excellent long-term results for SynerGraft pulmonary homografts; 95% of the pulmonary homografts in that study were our SynerGraft valves, which reinforces our position. Regarding the NEXUS sales force: NEXUS is an advanced, catheter-delivered technology requiring reps in every case, and those vascular surgeons are not the same surgeons focused on vascular tissue. It's a different customer set and role. So it's unlikely we'll combine those responsibilities; the NEXUS reps will be dedicated and focused.

The next question is from Danny Stauder from Citizens Bank.

On On-X: really strong performance on a much harder prior comp. Have you started or how much have you invested in cardiologist-directed marketing? If you have started, have you seen changes in referral patterns? Any more color would be great.

We have a multi-pronged approach. We're working on initiatives to deliver world-class, clinically communicated information to cardiologists about On-X benefits, but we're not prepared to reveal details until we're further along. Our team speaks to heart surgeons and cardiologists daily. To capture the full $100 million opportunity, we will need better cardiologist education, but a large portion is addressable by educating cardiac surgeons, which is squarely within our current capabilities and we are aggressively pursuing it.

As part of our market research, to capture the full $100 million opportunity we'll need to go upstream and improve cardiologist education. A large portion of the opportunity is available by educating cardiac surgeons, which is right in our sweet spot and we're focusing on that.

Thanks. One follow-up on AMDS messaging: to what extent were you restricted under the HDE from communicating and marketing, and what can you do now with the PMA that you couldn't before? That seems important for making people understand pricing and economics.

Under the HDE, our messaging was limited to the PERSEVERE trial results. Since then, several presentations covered additional data—particularly on malperfusion outcomes such as cerebral, visceral, and renal malperfusion—that we were restricted from marketing under the HDE because they weren't in that submission. Those data are included in the PMA, and we will now be able to aggressively market that information. That's an important point and explains why PMA approval materially changes how we can communicate the clinical benefits and the economic value proposition.

The next question is from Mike Matson from Needham & Company.

Question on international stent growth: how did that trend in the quarter? Last quarter you called out supply chain challenges and there's obviously regional conflict in the Middle East. Has that alleviated to any degree, and how much is left until the situation stabilizes?

On supply, we said we expected to get healthy by the end of the year, which was contemplated in our guidance. We made good progress in Q2 and feel even more confident we'll be ready for full strength heading into 2027. It's too early to call upside to 2026. Regarding the Middle East, we had a small amount of revenue in Q2, but we can't count on that going forward given the situation. International growth rates showed consistent improvement across the board in Q2, including Latin America, and we were pleased with that.

Great. With Endospan integrated now, any updated thoughts on their manufacturing site in Israel? Any challenges that could pop up and contingency plans? Also, are you adding reps specifically for AMDS following approval?

We're not planning to add reps for AMDS right now; we believe our current channel has the coverage we need for the second half of this year, though we'll evaluate next year. Regarding Endospan's manufacturing facility: despite regional challenges, they've done a fantastic job delivering. We haven't had supply chain challenges from their facility, and it's a PMA-capable site. We maintain contingency planning thoughtfully, but it's a committed facility for the foreseeable future. If we need additional sources down the road, that would be a backup plan and takes time to implement.

With PMA products, dual sourcing is challenging right at approval. We're working on contingencies for all parts of the Endospan supply chain, not only the Israel factory. Endospan already had certain things in process that we're continuing. We're doing the best we can to have contingencies in place, recognizing you can't create full secondary sources overnight for a PMA product.

The next question is from Frank Takkinen from Lake Street Capital Markets.

Apologies if this was asked. I wanted to talk about free cash flow a little more. Lance, you mentioned the $25 million AMDS payment in Q3. As we think forward, any other puts or takes in the cash flow calculations we should consider? And any initial thoughts on 2027 anomalies or is it likely to be cleaner on free cash flow conversion?

We hope 2027 will be cleaner because 2026 is fairly unclean on free cash flow. I can't think of anything material right now for 2027, but we may provide more clarity on the next call. On cash flow for 2026, heading into the year we expected free cash flow to be roughly neutral as we invested in the Austin expansion with higher CapEx. That's before considering the Endospan acquisition or the AMDS earn-out payment. In this quarter, roughly $10 million was effectively purchase price but GAAP required it to go through the P&L, so it hit free cash flow. In my view, that's not really free cash flow, but it shows on the cash flow statement. We also have approximately $8 million of incremental Endospan-related expenses and some incremental interest. Those items drive the free cash flow negative for the year. As we roll into 2027, with EBITDA growth, lower CapEx, and non-repeating Endospan expenses, we expect 2027 to be meaningfully free cash flow positive.

Mr. Mackin, this concludes the question and answer session. I'd like to turn the call back over to management for closing remarks.

Thanks for participating. Again, we're really pleased with our second quarter. It's rare that a company receives a PMA in a year; we received two and a quarter. We also completed the Endospan acquisition and have integrated it. The combined PMAs from AMDS and NEXUS along with our ARTISAN trial represent three PMAs now, and we have additional PMA programs behind them, totaling seven PMAs in the arch over time, which sets us up for long-term profitable growth. We're super excited about the transaction and look forward to talking to you next quarter.

This concludes today's call. You may disconnect your lines at this time. Thank you for your participation and have a wonderful afternoon.