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Intrinsic Value is all-important and is the only logical way to evaluate the relative attractiveness of investments and businesses.
Good day, ladies and gentlemen, and welcome to the LivaNova PLC First Quarter 2022 Earnings Conference Call. [Operator Instructions]. As a reminder, this conference call is being recorded.
I would now like to introduce your host for today's conference, Mr. Matthew Dodds, LivaNova's Senior Vice President of Corporate Development. Please go ahead, sir.
Thank you, Melissa. And welcome to our conference call and webcast discussing LivaNova's financial results for the first quarter of 2022.
Joining me on today's call are Damien McDonald, our Chief Executive Officer, Alex Shvartsburg, our Chief Financial Officer, and Lindsey Little, our Senior Director of Investor Relations.
Before we begin, I would like to remind you that the discussions during this call will include forward-looking statements. Factors that could cause actual results to differ materially are discussed in the company's most recent filings and documents furnished to the SEC, including today's press release that is available on our website. We do not undertake to update any forward-looking statement.
Also, the discussions will include certain non-GAAP financial measures with respect to our performance, including, but not limited to, sales results, which will all be stated on a constant currency basis. Reconciliations to the most directly comparable GAAP financial measures can be found in today's press release, which is available on our website.
We have also posted a presentation to our website that summarizes the points of today's call. This presentation is complementary to the other call materials and should be used as an enhanced communication tool. You can find the presentation and press release in the Investors section of our website under News, Events and Presentations at investor.livanova.com.
With that, I will now turn the call over to Damien.
Thank you, Matt. And thank you to everyone for joining us. Welcome to our conference call for the first quarter of 2022. I'll start off by discussing sales results, then review our strategic portfolio initiatives and conclude by describing a recently completed tuck-in acquisition. After my comments, Alex will provide you with additional details on our results and outlook. Then I'll wrap up with closing comments before moving on to Q&A.
In the quarter, we achieved 9% sales growth excluding Heart Valves. This was driven by above-market growth in Cardiopulmonary and Neuromodulation sales, which accelerated after experiencing COVID-related pressures early in the quarter. Advanced Circulatory Support sales were unfavorably impacted by hospital staffing shortages and a decline in respiratory cases, including COVID cases.
Below the top line, we expanded gross profit, which was partially offset by investments in our strategic portfolio initiatives, preparations for the phased launch of our next generation heart-lung machine, Essenz, and expanded commercial efforts in ACS and epilepsy.
Now, turning to the segment results. For the Cardiopulmonary segment, sales were $117 million in the quarter, an increase of 12% versus the first quarter of 2021. Oxygenated sales grew over 20% globally, driven by procedure volume recovery across all regions, particularly in Europe and rest of world. Heart-lung machine sales increased in the high-single digits due to growth in rest of world.
We now expect Cardiopulmonary sales to grow 1% to 3% for the full year of 2022. This increased range takes into account the first quarter performance, the read-through of year-over-year comparisons, and the sales transition to the Essenz HLM.
Global epilepsy sales increased 8% versus the first quarter of 2021, with growth across all regions. This increase is attributable to procedure volumes that improved each month during the quarter.
US epilepsy sales increased 6% versus first quarter 2021 with total implant growth in low-single digits. Similar to recent quarterly trends, total implant growth was driven by replacements, which physicians continue to prioritize over new patient implants.
The progress in US epilepsy continues to be supported by our go-to-market initiative, which currently encompasses 14 dedicated CEC teams, two of which were formed during the first quarter. These teams accounted for 21% of US sales and implants in the quarter as compared to 18% on the same account basis during the prior year. They continue to deliver sales and implant growth that trended above the baseline business compared to the first quarter of 2021.
Epilepsy sales in Europe grew 14% versus prior year, primarily led by the UK. We also achieved 14% growth in rest of world led by APAC.
For full-year 2022, we continue to expect global epilepsy sales to grow 5% to 7%. Our forecast includes growth in new patient implants, as patients and their caregivers returned to in-person physician visits and hospital capacity improves.
In addition, we anticipate a continued tailwind in replacement implants related to the backlog created during the pandemic that has continued into this year. We're pleased with the progress of the go-to-market initiatives and plan to add two additional dedicated teams in the US during the remainder of 2022.
ACS sales were $12 million in the quarter, representing a decrease of 10% from the first quarter of 2021. Results were impacted primarily by hospital staffing shortages and less severe COVID cases. Respiratory cases, including COVID cases, declined approximately 30% year-over-year as fewer hospitalized patients required ECMO therapy. Non-respiratory cases were flat year-over-year as account acquisitions were offset by the impact of hospital staffing shortages. Given these headwinds, we now expect ACS growth to be in the low-single digits for 2022.
As a reminder, for comparative results, Heart Valves was divested on June 1 of last year. Heart Valves sales for the first quarter of 2021 were $21 million.
Turning now to our strategic portfolio initiatives. DTD sales for the first quarter were $1.4 million. For 2022, we anticipate DTD sales were approximately $10 million.
Turning to the RECOVER study, during the first quarter, we achieved a key milestone of implanting our 250th unipolar patient. The randomized control study is designed with frequent interim analyses that will assess if predicted probability of success has been reached or if the study should continue.
As stated previously, we believe a series of interim analyses is likely needed as we collect patient follow-up data over time. Our interim analyses confirm continuation of the study. We still anticipate a transition to registry to occur for the unipolar cohort in late 2022 or early 2023.
In heart failure, the ANTHEM-HFrEF pivotal trial continues to advance. During the quarter, independent statisticians conducted the first interim analysis reviewing safety, a trend towards the primary endpoint and success in the three functional endpoints. The review indicated that one or more of the conditions were not yet achieved and recommended continuation of the study according to the protocol. The next interim analysis will occur after the 500th patient is enrolled, which we anticipate in the fourth quarter. If the results are favorable, we may submit the functional data to the FDA.
Moving to OSA, our OSPREY trial continues to enroll patients with the first patient implanted in February. We now have activated approximately 15 of the 20 study sites. The OSPREY trial is a randomized control trial to evaluate the efficacy of hypoglossal nerve stimulation for patients with moderate to severe OSA. We still assume submission for FDA approval to occur in the latter half of 2023 with a decision anticipated in 2024.
Now turning to the acquisition of ALung. On May 2, we acquired ALung Technologies, Inc. The purchase price included $10 million paid at closing and contingent considerations payable on achievement of sales-based milestones. ALung was a privately held developer and manufacturer of an innovative lung assist device for treating respiratory failure called the HemoLung Respiratory Assist System, or RAS. This system is an alternative or supplement to invasive mechanical ventilation.
The HemoLung RAS is the only FDA cleared platform designed specifically for low flow extracorporeal carbon dioxide removal for acute respiratory failure. ALung provides the complementary technology to our ACS portfolio in the respiratory market. The business, which will be integrated into our ACS segment, and we expect to initiate commercialization of HemoLung later this year, with nominal sales expected during 2022. The impact of the acquisition is expected to be neutral to adjusted diluted earnings per share.
And with that, I'll turn it over to Alex.
Thanks, Damien. During my portion of the call, I'll share a brief recap of first quarter results and provide commentary on the full-year 2022 outlook.
Turning to the results, sales in the quarter were $240 million, a 9% increase versus 2021 excluding Heart Valves. Foreign exchange had an unfavorable year-over-year impact of approximately $7 million or 3%.
Adjusted gross margin as a percent of net sales was 71%, which was up 290 basis points from the first quarter of 2021. Adjusted gross margin was favorably impacted by product mix and the divestiture of Heart Valves. Component inflationary pressure was offset by manufacturing efficiencies.
Adjusted R&D expense in the first quarter was $40 million compared to $42 million in the first quarter of 2021. R&D as a percent of net sales was 16.7%, in line with the first quarter of 2021.
Adjusted SG&A expense in the first quarter was $102 million compared to $96 million in the first quarter of 2021. SG&A as a percent of net sales was 42.5%, up from 38.9% in the first quarter of 2021. The increase was primarily driven by costs related to the acquisition of ALung.
Adjusted operating income was $28 million compared to $30 million in the first quarter of last year. Adjusted operating income margin was 12%, which was in line with the first quarter of 2021.
The adjusted effective tax rate in the quarter was 7% compared to 10% in the first quarter of 2021. The lower tax rate is primarily attributable to changes in the valuation allowances and geographic income mix.
For the full year, we expect the tax rate range of 10% to 15%. Adjusted diluted earnings per share was $0.48 compared to $0.34 in the first quarter of 2021.
Our cash balance at March 31 was $443 million, including $314 million of restricted cash held as collateral for the SNIA litigation guarantee, up from $208 million at year-end 2021.
Total debt at March 31 was $461 million, up from $240 million at year-end 2021. This increase primarily relates to the bridge loan facility that was entered into during February to secure the SNIA litigation guarantee.
Adjusted free cash flow for the quarter was $17 million, up from negative $8 million in the prior year. Capital investments were $5 million in the first quarter compared to $8 million in the prior-year quarter.
Now turning to our 2022 outlook. We're maintaining the guidance ranges shared in February as we navigate evolving pressures, such as supply chain challenges, foreign currency headwinds, and market conditions impacting ACS. This includes constant currency sales growth between 3% to 5%, excluding Heart Valves, and adjusted EPS range of $2.50 to $2.80 and an adjusted free cash flow range of $90 million to $110 million.
Our outlook now assumes a 2% to 3% sales headwind from exchange rates.
With that, I'll turn the call back over to Damien.
Thanks, Alex. In summary, the first quarter was a testament to our diverse portfolio which allowed us to weather the challenging market conditions. While several variables in our original guidance assumptions have changed, we remain confident in our full-year outlook.
We continue to focus on executing on our core growth drivers, delivering on our extensive clinical and product pipeline opportunities, and further improving profitability and cash generation. This emphasis on the strategic triangle, underpinned by the LivaNova business system, positions us to increase shareholder value.
And with that, Melissa, we're ready to open the call for questions.
[Operator Instructions]. We'll be taking our first question today from Rick Wise of Stifel.
Just to start off, I think a solid start. And you said, some parts of the business did a little better, offsetting weakness elsewhere. Let me start with ACS just because that was the biggest change. The rest of the business seemed on track or maybe ahead.
So, one is that, am I interpreting it at a high level correctly, is that how you're seeing it? And maybe just help us dig into ACS and maybe break down, if you would, the hospital staffing slowdown impact? How do we think about the COVID case decline? When do we get past that non-respiratory flat? How do we think about the progress from here? How do you get it back on track more in line with your original expectations?
ACS disappointed us in the quarter. And a lot of that had to do with this headwind we talked about and you talked about, the staff shortages. But also, I think the big thing for us was just decline in patients using ECMO for COVID. There's a 30% decline in that caseload year-over-year. And those really were important, given our expectation for those procedures. We really did anticipate also that the procedures that we saw through the quarter declining would be offset by other respiratory cases or other non-respiratory cases.
I think the modest flu season had an impact. We have pretty interesting CDC data that shows a big slowdown and also almost historical lows in the mild respiratory cases. The ECMO RV market declined 15% year-on-year. So, I think we did slightly better than the overall market. But we were anticipating a better response and our ability to move from one segment to the other.
So, I think through 2022, as we see the staff shortages abate, we expect this to start bouncing back. We also added a lot of our headcount in the commercial expansion late in the year of 2021. So, they won't start reading through until mid-year. And so, the effectiveness of that team will, I hope, read through in the back half of 2022.
Turning to the DTD registry, it seems like – again, correct me if I'm wrong – the timeline you've offered or suggested is, basically, you're reiterating the timing of a shift to registry as late this year or early next year. Can we take from that that enrollment is progressing well? And have the initial looks been encouraging? Can you give us some more color there?
I think you've hit the headline, which is it's continuing to progress well. We implanted that 250th patient in the quarter, the unipolar patient in the quarter, and conducted the first and second interim analysis. So, we're pleased with how that's progressing. We're still expecting a transition to the registry in late 2022 or early 2023. And we'll continue to provide the best information we can. Again, as we've said, we don't want to outrun our communication with CMS, but we're pleased with how it's progressing.
It's Matt. We're completely blinded from these interim looks. So, our independent statisticians review it, and all we're told is basically keep going, which, again, we think is good, stop due to futility, which is not good, and then stop because you've hit the primary endpoint. That's all we know. So the good news is, as Damien said, after two looks, we're not checking the box of futility. And that's continuing to enroll.
Last for me on the ANTHEM-HFrEF. You indicated that the analysis confirmed continuation of the study. I don't know – I don't want to overstate this. Is that slightly disappointing? How are you feeling about it? I know that the trial has an adaptive design and you could take another look, I think you said by the end of this year. How are you feeling on that front?
I think, again, positive the fact that the first interim analysis confirmed to keep the study going. It's a fairly complex study. There are five green lights that you're looking for in the interim analyses. One is safety. I'm pleased that we're continuing to enroll. So, I think that means safety puts us in a pretty good spot. And I think the fact that the others working in a very complex environment, including COVID cases, we're making progress. And as you say, it's an adaptive study. We got to have looks at it instead of waiting for one primary readout. And the fact that we're continuing to recruit is a good sign.
We'll take our next question from Mike Polark of Wolfe.
Follow-up on the depression commentary there. So, your independent statisticians have looked twice. I assume there'd been one look at 250 unipolar implants. My understanding the protocols, you get the second look at 275. So, does having had two looks mean that the enrollment now is north of 275? Is that the correct read?
This is Matt. That is the correct read.
I had this question come in a few weeks ago. So, your plan is to continue to enroll to the trial to get the subsequent interim looks versus kind of slowing enrollment down and just letting the sample accrue time on therapy, is that fair? Or is there a balance that you're striking here as you kind of enter the meat of the sample where you might slow down fresh implants and just let the time accrue to the patients that have been implanted? Hopefully, that question is clear. Just how are you thinking about the pace of enrollment here over the next quarter or two or three?
Now, it's a good question. If you look at the design of the study, we do want to have more patients enrolled. And to your point, once we hit statistical significance on the assumption we do, then we would want to stop enrolling in that arm because we have to follow every patient for 12 months. So, the team is still very focused on enrollment. And as you know, every 25 patients, we can continue to look. So as we move forward, not only do we get more patients, the average follow up per patient increases as well.
The other thing is, there's two arms, don't forget – the unipolar and the bipolar. So we want to keep the momentum at recruiting. We've explained we're skewing unipolar, both in terms of our effort and the patients we're seeing. We want to continue the momentum at all of the sites, so that we can continue to enroll the bipolar patients in that secondary arm as well.
And to put a fine point on the timing, I ask because I know I'll get asked. So, you announced the 250 at unipolar implant on March 14th. I presume that's when the first look was taken by the independent statisticians. The second look was taken when, I presume, within the last week, two or three. I'm just trying to get a sense for the pace of every 25 implants, is it kind of four, six weeks? Is that how you're running at the moment?
Yeah, so every four to six weeks, I think, is a good estimate if you're modeling that.
Last one for me and I'll hop. I know that was a series of questions. Bipolar, where does that enrollment stand at the moment?
Yeah, much, much slower, again, given our emphasis on the unipolar. And what we're trying to do is get that one over the line first. It's now expected, I think with the 150 implants, late 2022, early 2023. But I think you've got to look at this as an indication expansion opportunity. So, first, maniacally focused on unipolar. If we get bipolar patients through the consenting system, great, but the real focus is on unipolar and then we'll move on to bipolar as an idea to expand the indication later on.
Our next question comes from the line of Mike Matson from Needham.
Just following up on that line of questioning around the RECOVER trial. So, your depression revenue stepped down in a meaningful amount. I think you said $1.4 million in the first quarter. I think you did about $3 million in the fourth quarter. Can we read anything into that about the pace of enrollment here or in the timing of the trial?
It's Matt. So, the enrollment did slow down a little bit in January and February. Similar to what you've heard with a lot of people talking about revenue, you can assume the same thing occurred on the clinical side. It did pick up in in March and April. So, that is the primary reason.
As far as the litigation in Italy and the Italian Supreme Court decision, do you have any feel at all in terms of the timing of when you would expect something there?
No, there's a long process. They don't have statutory timelines that are published. So, we're playing this day by day.
Finally, the heart-lung machine growth was surprisingly strong, given you've got this Essenz launch coming. So, one, I guess you've launched Essenz outside the US, or Europe maybe. So, did that help at all? Conversely, it didn't seem to hurt, I guess, in the US that customers are maybe waiting for the new product?
This is Alex. We were pleasantly surprised in terms of the unit placements in the quarter. We haven't launched that since in Europe, as you described. That is scheduled for the second half of this year. We were expecting a slowdown in the F5 placements, sort of customers anticipating Essenz in the back half, but that has not happened, which is great for us and we continue to do well on that front.
Our next question today comes from Adam Maeder of Piper Sandler.
Congrats on the start. Maybe just first one for me, very dynamic procedure environment. Would just love, Damien or Matt, a little bit more color on kind of what you're seeing real time kind of exit velocity. In March, how things have trended? In April, just puts and takes for some of those different segments. And then I have a follow-up or two.
When we spoke in February, late February, I think we talked about the patient funnel improving through the quarter. That was definitely the case, as March progressed and into April. We're still seeing the same physician bias to the end of service product. I think the two bottlenecks that remain are surgical scheduling with staff shortages are definitely impacting new patient implants, as are the EMU capacity for new patient workups. So, I think the dynamics that a lot of people are reporting, definitely, were what we saw. Very slow January, ramping through March, continuing into April.
I think, in CP, cardiac surgical volumes have returned to the pre-pandemic levels. And demand has remained strong in April.
Do you want to add anything, Matt?
No, I think that's it. Again, as Damien said earlier, with ACS, that was the one that went the other way because of the staff shortages and the reduction in COVID patients that use ECMO.
Next question is on the EPS guidance. Adjusted EPS, I think, $2.50 to $2.80. So, fairly big range there. Maybe just unpack some of the key assumptions in that range, what's contemplated, for example, for currency impact to EPS. And then, if I saw correctly in the materials, I think your non-GAAP and the interest from the bridge loan, so maybe just kind of walk through some of those items and kind of how to think about the high end versus the low end of the guidance range. And then, I had one quick follow-up.
Our gross margins are expected to increase in 2022 by more than 200 basis points. The expected increase is primarily driven by the Heart Valves divestiture, positive product mix, and other efficiencies that are offsetting our supply chain cost challenges.
As far as R&D is concerned, as a percentage of sales, that's going to increase slightly versus prior year. And this is largely due to the initiation of the OSPREY trial as well as the investments in ACS and epilepsy commercial – sorry, in epilepsy R&D programs.
From an SG&A perspective, slight increase versus 2021. Our total OpEx, I think we talked about this before, quarterly run rate is approximately $140 million. That's for both R&D and SG&A.
Our kind of base interest expense is $11 million to $12 million. And as you said, we're non-GAAPing the bridge, the interest related to the bridge facility as that's related to the SNIA litigation. So that will be called out in our non-GAAP reconciliation. And our tax rates, we're projecting at 10% to 15% as the range.
You raised currency. Currency is 2% to 3% headwind for the full year. And I think you asked what's guiding this range? I think there's a lot a puts and takes. If we continue to expand the US epilepsy penetration, I think that's an upside. I think if supply chain challenges abate as we go through the year, we're playing month by month, but the Cardiopulmonary business and especially heart-lung machines swing to the upside, depending on how people react to Essenz, we continue to see heart-lung machine demand, but we're anticipating that people will wait for that launch. And we're also counter-measuring the Russia-Ukraine, headwind. So all of those things are the puts and takes, and that's why we have this range and we're sticking to our original February guidance on that EPS range of $2.50 to $2.80.
If I can just sneak in one last one on DTD. And this is a question that I get from clients, just around communication strategy or kind of the pathway for the Street looking ahead. Guys, what is the next update that we should be looking for? It sounds like things continue to track in line with previous expectations in terms of transition to the registry late 2022, early 2023. But what should we be looking for – what's going to hit the tape? Is it really around kind of the submission of the data package to CMS to move to the registry or kind of what's the next kind of milestone or marker that we should be keeping our eyes peeled for?
That is our next milestone, is the communication of that transition to registry, which will follow our communication to CMS. Again, we don't want to end run the discussions with CMS, but that's the next milestone.
We're now moving over to Amit Hazan of Goldman Sachs.
It's Phil on for Amit. Most of mine have been asked in some form or fashion. I'll try and put a finer point on a couple of them. So, the incremental FX headwind, I'm hoping, Alex, maybe you can speak to the drop through rate and how much of an impact you're offsetting down on the bottom line for FX.
And maybe asking the last question slightly differently, where that offset is coming from given the incremental supply chain challenges and the FX that's incremental as well versus the kind of guidance that you provided back in 4Q?
The revenue impact of 2% to 3% is a pretty significant drop-through in terms of EPS impact. We're obviously counter-measuring it with cost reduction, productivity initiatives and that's kind of the way we're able to offset the impact of the inflationary as well as the FX challenges that we have.
We're going to see it in both SG&A and GM from the productivity, is that fair to say?
It's the largest impacts on gross margin. We actually get a little bit of a benefit on the SG&A side from FX. R&D is largely neutral from that perspective. So, that's why it's a significant drop-through from a gross profit perspective. And we have approximately $0.20 to $0.25 EPS exposure. But, again, we're counting-measuring it with productivity and cost reduction.
And the other one, just mentioned the RU conflict, I was hoping maybe a finer point on your rest of world exposures. Maybe talk to China exposure. Obviously, rest of world was actually quite strong in the quarter. I'm wondering exposure to RU and the impact you've seen in China, impact seen kind of where we are today and any other markets you'd call out that have been incrementally hit.
We saw a limited impact from China, really hardly any. Obviously, the lockdowns have had an impact in the market, but we haven't really seen it on read-through from a performance perspective.
Can you remind us exposures for China and for Russia in relation to that 20% rest of world business?
Russia-Ukraine was about 1% of revenue in 2021 and China is about 3% to 4%.
If I could just sneak one more in, definitely understand the inflationary supply chain issues. Is there any concern about ability to kind of fulfill demand, especially with the increased interest and demand for oxygenators, anything that you're worried about on the component side that might limit your ability to satisfy this increased demand that's coming through the pipeline now?
Look, I think that's one of our big things that we've really focused the team on was the whole supply chain, logistics, microelectronics availability, epoxy availability, transportation logistics, and lead times, all the things that we're focused on with the team. What they're really doing is working very aggressively to give our suppliers more visibility to our long range plans. We're working very hard on the critical supply reviews with them. We've increased inventory in several areas. And our guidance contemplates that.
So, our process so far has been increasing communication with suppliers, looking for alternative suppliers where there's a need. Or as I said, building inventory ahead of this demand. But so far, the team have progressed well, but like everyone we continue to face those headwinds.
We'll take our next question from Zachary Weiner of Jefferies.
Just one on epilepsy. Can you just remind where backlog currently stands? If my memory serves, it was roughly 800 procedures at the beginning of this quarter. So, just curious how much of that backlog you worked through and then how much you expect to work through through the course of the year.
We're expecting this backlog to continue through the rest of this year and into next year. Right now, we think the numbers are around about 700. So, we've burned through about 100 in the quarter. And again, I think people continue to put this at the top of the stack versus new patient implants. It's an easier process to put patients through that cycle and ensure that they have continued therapy. The workup for new patient implants is quite considerable. So, physicians are definitely skewing these end of service patients, and we're gradually working our way through that backlog.
Our last question today will be a follow-up from Mike Polark of Wolfe Research.
CFO question, just with the inclusion of the bridge facility now to backstop the Italian surety. Alex, I'm hoping you could bridge the adjusted free cash flow guidance for the full year of $90 million to $110 million. If you were to unadjust that and frame traditional free cash flow inclusive of the bridge costs, the 3T, the other items that you're excluding, what's the sum total of those adjustments just to level set here for the full year?
The bridge facility is kind of a temporary vehicle. And so, we're looking to refinance that in probably the next quarter or so. So if we're modeling based on what we're seeing, we're kind of leaning towards sort of public data as a refi facility. So, modeling kind of the current interest rates, so we're looking at $15 million to $20 million of potential impact on an annual basis.
I have to follow-up on that. So, will that then come into your adjusted earnings as it transitions from bridge facility to public debt? Or since it's kind of this limbo moment where you're backstopping an escrow for a case that you're pursuing remedy for that you would continue to exclude it? What's the treatment of that transition from bridge to public debt as it relates to your adjusted earnings guidance if and when that happens?
That's right. So, we're going to continue to adjust it from operating earnings until there's a ruling on the case. If we end up winning, it's obviously a non-issue. If we lose and have to pay for the damages, it essentially becomes a permanent part of our capital structure and that's when we'll move it into operating earnings.
As that was our final question today, I would like to hand back to Damien McDonald for any closing remarks.
Well, thanks, Melissa. And thank you to everyone for joining our call. And on behalf of the entire team, I just appreciate your support and interest in LivaNova and we look forward to updating you on our Q2 call. Thank you.
Thank you. This concludes the LivaNova PLC first quarter 2022 earnings conference call. Thank you all for attending. You may now disconnect.