AtriCure, Inc. (ATRC) Earnings Call Transcript & Summary

Good afternoon and welcome to AtriCure's Investor and Analyst Meeting in conjunction with HRS. My name is Stacy, and I will be your coordinator for the call today. [Operator Instructions] We will be facilitating a question-and-answer session toward the end of today's call. As a reminder, this call is being recorded for replay purposes. I would now like to turn the call over to Lynn Lewis from Gilmartin Group for a few introductory comments.

Thank you so much. Before we begin today, I'd like to remind everyone that as part of today's call, we will make certain comments about AtriCure's future expectations, plans and prospects that are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements include, but are not limited to, expectations regarding the timing of FDA review, expectations regarding FDA's response and whether it will approve CONVERGE, the potential CONVERGE launch timing, the potential market opportunities for CONVERGE and the adoption of the CONVERGE procedure. These statements are based on the beliefs and expectations of management as of today, May 8, 2020. Actual results may differ materially from our expectations. The company undertakes no obligation to revise or update any statements to reflect events or circumstances after the date of this conference call. Investors should carefully read risks and uncertainties described in today's press release and in the slide presentation related to this call as well as risk factors which identify specific factors that may cause actual results or events to differ materially from those described in the forward-looking statements included in the company's most recently filed annual report on Form 10-K and other filings with the SEC. With that, I'd like to now turn the call over to Mike Carrel, President and Chief Executive Officer of AtriCure. Mike?

Thank you, Lynn. And everyone, thank you for joining us today for a call with our panel of physicians. We're extremely excited, obviously, to announce the CONVERGE data. Many of you may have seen not only the press release but the presentation by Dr. DeLurgio this morning. What I wanted to do today is first introduce you to the panelists, give you a brief overview of the market and how we're looking at it and then pass it over to Dr. DeLurgio and open up for some questions. Our panel today is really an esteemed group of physicians who -- some of them have a lot of experience and some of them do not with the CONVERGE procedure, and we did that on purpose so that you could ask a lot of questions from that standpoint. Dr. DeLurgio, as many of you probably saw, he's with Emory University. He's the Director of Electrophysiology there, and he's a national PI for the CONVERGE trial. He's worked tirelessly over the last 5 years in helping us guide us through this. In addition to that, he's also performed over 180 commercial cases as well. Joining Dr. DeLurgio is Dr. Hugh Calkins with Johns Hopkins University. He's a professor of Medicine, Division of Cardiology, and he's also a Head of the Arrhythmia Service. He's been with HRS guidelines and been the HRS President as well. He does not have commercial experience with it, which was one of the reasons we brought Dr. Calkins on board was to have an independent view and allow you to ask questions. But he does know the data very well and has been working collaboratively with us in talking to the FDA. In addition to that, to round out the group of colleagues that we have here today is Dr. Christian Shults. He is with MedStar. He is the Interim Chief of Cardiac Surgery and Co-Director of Complex Aortic Disease program there. He is also an investigator in the CONVERGE trial. He's performed over 150 commercial cases and has been a surgeon proctor. So he really understands how to train and educate surgeons in this particular area. So with that, what I'd like to do first is just -- what we're going to do on this call, you've got the presentation that you got -- you have online. I will call out the page number, as will Dr. DeLurgio, so that you know what page we're on. And then we will continue to kind of move through so you kind of have a general sense for that. So I'm on Page 3 of the deck that has been posted online. And I thought it would be important to start the conversation with just some numbers to remember. The Hybrid Convergent procedure is not a new procedure. It's well-established around the world. We've done over 10,000. In fact, over 11,000 Hybrid Convergent procedures have been performed to date with a very good safety profile overall. We do about 1,800 Hybrid Convergents every year. So in 2019, it was about 1,800 or so total. If you think about that and start to begin to think about how big this market could be, 1,800 is a very small number compared to the number of catheter ablations that are done in the United States alone, forget about thinking about around the world, for persistent and long-standing persistent patients. In fact, it's less than 3% of the total amount of catheter ablations for that particular patient population. So the market there is very big in terms of being able to be additive, as the data has shown us, to the catheter ablation, which is what the Hybrid Convergent procedure does. It's an additive procedure from that standpoint, and there is a big, large patient pool that can benefit from this particular procedure potential. So in addition to that, there's obviously potential upside from a market-size standpoint in patients to be treated because not only are they patients that are treated today with catheters, many are not going under catheter treatment every year. And so as a result, they kind of fall out of the system because people have kind of given up on them. And so there's even a larger potential, large $1 billion opportunity there for us as a company. Some other numbers that I think are really important to have some perspective on is that around the United States, there's about over 1,000 or so U.S. sites who could potentially do the Hybrid Convergent procedure. It's closer to 1,100 sites or so. To date, we do about 100 or so sites that are performing this on a regular basis. So we're still less than 10% penetrated just in the number of sites in the United States. So once we are able to get the approval from the FDA, then we can kind of obviously begin to expand that at that point in time. So Hybrid, as I've -- as you can see at the bottom of there, Convergent procedure, is a widely used approach with a very large market opportunity. So why did we run the trial? Moving on to Slide 5 for you here. Why did we do this? Well, obviously, as I just mentioned, it's a large untreated population. The Hybrid procedure really does, and Dr. DeLurgio will go into more details, bring the advantages of both epicardial and endocardial to really put together a truly robust transmural lesion set. In the EP community, there's been more and more conversation about this left atrial wall isolation, and it's gaining momentum as a conversation. And we believe this will open up that discussion overall. And what's incredibly unique about this trial is that it is the only prospective randomized controlled trial that is studying patients without any limitation to Afib. This is very unique. It's incredibly differentiated because the robustness of this trial, I believe, is incredibly important and, therefore, was able to show superiority in the trial. And Dr. DeLurgio will go through some of those numbers. So we completed enrollment in August 2018, submitted it to the FDA in late 2019. We are in interactive conversations with the FDA. And today, obviously, at HRS, we had our late-breaker. And I will now turn it over to Dr. DeLurgio to talk about what we've learned at HRS during the late-breaker today. Dr. DeLurgio?

Thank you very much, Mike, and thank you to the group of analysts in attendance today. Let's move to Slide 7. So I'm presenting a version of what we presented today to give you more chance to digest information and ask questions. What I wish to open with is the unmet need of ablation of drug-refractory persistent Afib. We know that Afib affects more than 33 million people worldwide with huge numbers here in the U.S., and approximately 70% of all AF is nonparoxysmal. So in other words, 70% of all AF is persistent or long-standing persistent, therefore, in our wheelhouse. Unfortunately, endocardial ablation is not very effective for treatment of persistent atrial fibrillation, as shown by some of the landmark trials. And that's because of the changes in remodeling that occur over time as one progresses from early or paroxysmal Afib to later or persistent atrial fibrillation. And the table here is from the STAR AF II trial, one of the pivotal trials comparing 3 different methods of endocardial ablation for persistent Afib. And the standard ablation that is still done today, which is isolation of the pulmonary veins, only met the primary end point in 41% of patients. And with additional endocardial ablation, it actually went down instead of up. So we did not have an effective treatment for persistent atrial fibrillation. Next, Slide #8. The Hybrid Convergent procedure, which is used in the CONVERGE trial, is designed to meet the unmet need of treatment of patients with persistent atrial fibrillation. It's combining epicardial and endocardial ablation to achieve a more comprehensive extrapulmonary vein ablation as well as isolation of the pulmonary veins while minimizing risk of injury to the esophagus and other extracardiac structures. It's designed to employ the skills of a cardiothoracic surgeon and the electrophysiologist working together. And the image there shows the epicardial lesion in blue on the posterior left atrial wall in this picture of the heart from behind. And then the endocardial lesions applied in red to complete the prescribed ablation lesion set. Slide #9. CONVERGE trial is a randomized controlled trial, which I think is very important because it's the only randomized Afib trial being presented currently. It was a 2:1 randomization to the Hybrid Convergent arm versus standard ablation. And people were followed in a prescribed way recommended by the Heart Rhythm Society. Essentially, they had follow-up Holters, ECGs, clinic follow-up. There was a 3-month blanking period, and the primary end point was measured at 12 months. But we continue to follow up to 18 months, which will be reportable down the road. And then longer-term follow-up will be available as well. Next, Slide 10. Key inclusion criteria are important to understand. Of course, persistent atrial fibrillation was a key inclusion criteria for this trial. But unlike other trials, we imposed no limitation on the duration of atrial fibrillation. And that resulted in a high portion of patients with long-standing persistent atrial fibrillation. We also had left atrial size allowed up to 6 centimeters, which is also unusual. Standard refractoriness to drug treatment was part of the inclusion criteria. An important exclusion criteria included is EF less than 40% or prior pericardial surgery that could limit access to the pericardial space. Slide #11. This slide compares clinical trials that you're familiar with, beginning with the Medtronic STOP Persistent Afib using cryoballoon; the PRECEPT trial, which was also reported today; the DIAMOND and PERSIST-END and the aMAZE trial. Now you can see the differences here that long-standing persistent atrial fibrillation was a major feature of the CONVERGE trial, not seen in the other trials, with the exception of SentreHEART trial, which did allow patients with long-standing persistent Afib. All other trials that are being reported or nearing reporting cut off the AF duration to 12 months. And with the exception of SentreHEART, all had smaller left atrial size inclusion criteria as well. Of these trials, only SentreHEART, aMAZE trial and the CONVERGE trial are randomized. So these are the lesion sets. Now remember, the standard for ablation of persistent atrial fibrillation has been isolation of the pulmonary veins using endocardial catheters. Therefore, that's the basis of the control arm, shown on the right in this picture. It involves endocardial wide area circumferential ablation of pulmonary veins with a roofline and a right cavotricuspid isthmus line as well. The study arm essentially compared endocardial ablation with the addition of the epicardial lesions, shown in blue again. So the concept was to isolate the posterior wall with the epicardial approach and then going endocardial, do the touch-up endocardial ablation to complete the isolation of the pulmonary veins and validate complete isolation of both pulmonary veins and posterior wall. As in the control arm, the right cavotricuspid isthmus line was also applied. Next slide is #13. The primary effectiveness end point is freedom from Afib, A-tach and A-flutter at 12 months, absent a Class I or III antiarrhythmic drug addition. A previously failed or intolerant Class I or III antiarrhythmic drug could be allowed as long as the dosage was not higher than what had been used originally. Key secondary end points are 90% reduction from baseline AF burden measured at 12 months and also freedom from atrial fibrillation at the 12-month mark. The difference between this and the primary end point is this is just freedom from AF in general, whereas the primary end point was Afib, A-tach, A-flutter, essentially all atrial arrhythmias. This is a superiority trial as well. Important safety end points are listed here. Now because the study procedure is different than the control procedure, we had to create a performance goal for safety, recognizing that the addition of epicardial ablation does carry the potential for adverse events. So the performance goal set pre-study is 12%, and that included measurement for any adverse events such as cardiac tamponade, pulmonary vein stenosis, excessive bleeding, myocardial infarction, stroke, TIA, atrioesophageal fistula, phrenic nerve injury or death. These were measured major adverse event rates -- events, sorry. Slide 15 shows our baseline demographics. You can see that there's no real difference between the groups. Something I highlighted in red here is that this trial showed patients having a mean of 4.4 to 4.5 years since diagnosis of persistent atrial fibrillation. This is very unusual for AF trials showing a large portion of patients with long-standing persistent atrial fib, which you can see immediately below that is approximately 40% throughout the entire study. Next slide is Slide #16. A little bit about the parameters. The total time for ablation in the endocardial group was 171.4 minutes. In the study group, there are 2 separate ablations performed serially. And the total time combining those 2 procedure times is very comparable, if not almost identical, to the total endocardial ablation time. And that's because the amount of endocardial ablation is considerably less after the posterior wall has been ablated epicardially. You can see that the time to perform the surgical epicardial ablation is relatively modest. Fluoroscopy time is also comparable. And the last 2 lines show the 2 different approaches. When the study was initiated, the approach was a transdiaphragmatic access to the pericardial space. During the trial, the subxiphoid approach was also developed, which did not require entering the abdomen. And it was, therefore, added, and physicians could use whichever procedure they felt more comfortable with. Slide #17. I'd just like to show this 1-voltage map of a completed patient. This is a left atrium shown from behind. The purple color represents voltage, which is normal. Gray represents complete absence of electrical activity or complete absence of voltage. And you can see that after the epicardial and endocardial ablation, we achieved complete isolation of the entire posterior wall and all the pulmonary veins. Slide #18. This slide shows our primary effectiveness end point. So it was measured at 1 year, and it's important to see that there's a large statistical significant difference. The endocardial ablation arm had 50% freedom from Afib, A-tach and A-flutter, whereas the Hybrid Convergent arm had 67.7% freedom from A-tach, Afib, A-flutter with an absolute difference of 17.7%, which was highly statistic with a p-value of 0.0253. Next slide is #19. The primary effectiveness end point is also shown again in a bar graph form here, 67.7% versus 50%. And we also include 2 more comparisons of our secondary end points. The first is a 90% burden reduction of atrial fibrillation, and this was achieved and measured at 12 months by Holter and achieving 80% of the study arm versus 56.8% of the control arm. And freedom from atrial fibrillation itself was 71% in the control arm and 51% of patients in the -- I'm sorry, 71% in the study arm, 51% of patients in the control arm, as shown in the third column. These were all statistically significant. Slide #20. The primary safety events through 30 days post procedure, and it's important to realize this is measured at 30 days and not at 7 days, which you've seen in some other trials, was 7.8%. This was below our pre-specified performance goal of 12%. There were a total of 8 major adverse events listed here. In this list, there are 3 -- correction, 4 episodes of pericardial bleeding. These occurred 8 to 20 days after the procedure, thought to be due to inflammation. Of these 4 cases, 3 of them had not received anti-inflammatory treatment, pointing out the importance of mitigation strategies, which we've since learned are crucial and are prescribed. Last slide, 21. In conclusion, this is the first multicenter, randomized controlled clinical trial, which compares the effectiveness of combined epicardial and endocardial ablation to endocardial ablation alone, treating patients with persistent and long-standing persistent Afib. We demonstrated that the Hybrid Convergent procedure has an acceptable safety profile and superior effectiveness when compared to endocardial ablation alone. We hope you'll agree that we're providing high-quality randomized controlled data regarding this exciting breakthrough. And lastly, I would like to emphasize the value we found in a team-based approach, which leverages the skills of both cardiothoracic surgeons and cardiac electrophysiologists. Thank you very much. I'd like to hand it back to Mike.

Thank you, Dr. DeLurgio. And again, once again, appreciate all the work and efforts that you've put forth to really make this trial a reality. Without your leadership, we would not be where we are today, and we truly, truly appreciate it. Before we go and open it up for questions, what I thought we would do is maybe just allow Dr. Calkins and Dr. Shults to make a few comments. Dr. Calkins?

Yes. Thank you, Mike. I consider this to be a real landmark trial. The challenge of persistent Afib can't be underestimated. And for years, people have tried different approaches, different techniques. And ultimately, when they're subjective to a randomized trial, all have come up empty, have been negative. And the current -- 2 current trials of catheter-based approaches for persistent Afib were nonrandomized trials with objective performance criteria in patients with sort of early forms of persistent Afib. So this was completely different. This was patients, as you've heard, that have had Afib of any duration, persistent Afib of any duration, with 40% being in continuous Afib for more than a year. And the length of time you're in continuous Afib sort of predicts the greater chance that catheter ablation won't work. So this was refractory patients. And most catheter ablation trials would limit patients' left atrial size to 5 centimeters. Again, here, the limit was 6 centimeters. So again, a very different patient population. And I really congratulate AtriCure for doing a prospective randomized trial head-to-head of a PVI-based ablation strategy with their Convergent strategy. And the results speak for themselves. An 18% difference is more than a 30% improved efficacy with a very acceptable complication profile, no esophageal fistulas, no deaths. So I consider this trial to be extremely important for the field and for our patients. And I really congratulate AtriCure for doing a beautiful study that I think the whole field will really appreciate their efforts.

Thank you, Dr. Calkins. Appreciate that. Dr. Shults?

Thanks, Mike. Yes, it's a pleasure to be here. I think this is very exciting data, very exciting results. I think we have eagerly anticipated them for several years. As someone who's been doing this procedure for 6.5 years and has seen the results and been very happy anecdotally with the results in our center -- and the patients keep getting referred for this procedure because, as was mentioned, it's a very difficult patient population to treat. And quite frankly, there aren't good effective treatment options for them. So like I've been doing this for 6.5 years. And it's exciting to see this gold-standard randomized controlled trial, which I think definitively answers the question of whether or not this works. I think there's a lot of people on both sides in the EP world as well as the surgical world who are kind of sitting on the fence based on the fact that there is a lot of retrospective single-center data that shows there may be some effectiveness. And there's also a lot of anecdotal data. But up until this point, there had not been this randomized controlled trial. And I applaud AtriCure for taking that step, the expense, the time, everything involved for doing this trial because I think it definitively, with gold-standard evidence, says that the CONVERGE procedure is more effective than catheter ablation. I think that commercially, the vast majority of patients that I'm doing this procedure on are patients who had 1, 2, maybe 3 ablations already. And again, it's -- they've kind of gone down the pathway of catheter ablation. And at a certain point, EP say, there's -- I don't really have any other options. Let's try CONVERGE. And it's been very effective in those. This trial is also interesting in that it was in de novo patients, patients who've never had an ablation. So I think not only does it answer the question of, is this effective kind of head-to-head with catheter ablation, but also, I think, raises a question, is this -- should this be considered as first-line therapy for patients who are long -- persistent and especially long-standing persistent. I think that's a debate that we'll have kind of going forward. But I think, from my perspective, what's most exciting is it provides definitive data. And I think it kind of forces people to reckon with this procedure and answer the question for themselves, as this is something they're going to integrate into their practice.

Thank you, Dr. Shults. And with that, what we'd like to do is turn it over to questions. Lynn, I know if you could open it up at that time, that would be great.

[Operator Instructions] Your first question is from Robbie Marcus from JPMorgan.

Congrats on a really wonderful set of data here. That should help a lot of patients. I'll just ask both my questions upfront into one. Mike, going back to the slide at the beginning of the deck, 1,800 procedures done a year, this is 3% of long-standing persistent catheter ablations annually, 100 sites. But you could have 1,000 sites doing that. One, help us understand what's a realistic pathway forward here in terms of adoption? What are some of the headwinds we should be thinking about? Or how fast will this start to ramp up? And I realize we're in the middle of a pandemic, so it's probably not right now. We'll see when you get approval. And then second, how are you thinking about approval here? Do you still think you're going to need a panel? And any timing around that.

Great. Sure. Well, thanks, Robert. Appreciate the question. When we think about the procedure, I'm going to answer the first one, which is the approval and kind of whether or not we think that we're going to have a panel. As we've talked about on previous calls before, we absolutely believe that we will have a panel. We're obviously not certain of that, but we're planning for it as if that is what is going to happen at this point. And so we're marching down that path [indiscernible] in. We are in interactive conversations with the FDA at this time, and we anticipate that as the year progresses. And so that's really critical to your next question, which is we really can't go proactively and do any kind of marketing until we actually get that approval. We're obviously -- and we've trained our sales team on that front as well. The data was presented at HRS today. It is out there, but we aren't allowed to kind of go proactively down that path. We do anticipate that we will get an approval sometime. We don't know the exact date. I'm not going to kind of peg a time line in terms of what it's going to take to have the conversations back and forth with the FDA. But it should be -- as we look at 2021, '22 and '23, you'll begin to start to see some ramps. We do anticipate that much like you've seen in many other trials, as you've got new adoption like that, there's got to be a lot of discussion and debate about the data. And there's got to be -- a lot of that discussion is probably going to occur in 2021 as you gain some interest and momentum with it and then begin to start to see in 2022 and '23 some acceleration of that 1,800 to significantly more patients that get treated on an annualized basis. So we look at 2021 to be the year that we are going to be ready and ramping up and then '22 and '23, where you'll begin to see kind of an acceleration from a growth standpoint. That being said, we are prepared today. We do have our team in place. Our team supports cases and does the things they need to do today. We've got over 30 people in our MIS division who are well-trained and understand this procedure exceptionally well. They've been in cases. They've been around this procedure for a long time. They understand not only the data from this trial, but understand it holistically around the market. And so we are definitely ready for that when the pandemic kind of comes to an end, when we get through the approval process, that we'll begin to be able to accelerate that revenue base as we again look into '22, '23 and '24.

Your next question comes from Rick Wise from Stifel.

Congratulations both to the doctors and to the company. I think my first question should focus on maybe from a physician perspective, the challenges, the barriers to adoption. I mean -- and maybe Dr. Calkins can talk about this in particular. But from a -- you're not doing it at the moment to adopting it and performing CONVERGE procedures or Convergent procedures. What's required? What kind of training? What kind of hospital process? And maybe you can help us understand some of those challenges and -- as we think about the future.

Yes. Thank you for that question. This is Hugh Calkins. I mean, the first thing we need is a willing and able cardiac surgeon. And some cardiac surgeons are passionate about Afib and Afib therapies, and others, I think, are less so. But that's something that's needed. The second thing we needed was data. Up until this study, all we had was single-center studies and a handful of data. And I've seen a lot of patients from Baltimore referred down to Washington Hospital Center for this procedure. And I -- this has kept happening. And so I sort of was curious about the procedure because if it didn't work, people would figure it out. But I think that should have made it clear that this was going to be a positive study or else these patients wouldn't continue to be sent that way. In terms of steps going forward, the first thing we need is to study. Then any hospital has a process for new capital equipment, but I think data that it's -- really addresses a new patient population, they'll pay a lot of attention to. And then you need an interested surgeon. But I think most surgeons, assuming they're willing to be trained in this, I think that could all fit into place. So I see this really growing over the time ahead, and I would anticipate that we'd be offering the procedure here. But Chris should be able to address some of these issues about training and how skilled do you have to be as a surgeon, either you need to be the best surgeon in the world or can be an average cardiac surgeon. Those are questions I can't comment on.

Yes. So I'm happy to pick that up. This is Christian Shults. So it's interesting. Like I said, I've been doing this procedure for 6.5 years, and I actually have spent a fair amount of that time after I've done a couple of years of proctoring other sites throughout the country and Europe as well. And from my perspective, on a scale of 1 to 10, 10 being a very complex surgery, very high level and 1 being very straightforward, this is a 1.5, somewhere in there. I mean it's a very straightforward procedure that can be easily picked up by just about every surgeon. I think that especially with the transition to a subxiphoid access, a subxiphoid pericardial window is something every cardiac surgeon who's board-certified knows how to do. And it's very straightforward. I guess, initially, the learning curve is just kind of understanding the anatomy of the posterior left atrium and kind of being comfortable manipulating and ablating in that space. Most physicians kind of approach that appropriately and gingerly at first. But then after a few cases, they understand what it takes, and they're off and running. I think the adoption from my perspective and from the training perspective is very straightforward. Of all the things we do in the world of cardiac surgery, this is a pretty easy surgery.

Great. And just for my second question, I mean, again, the data looks fabulous to me. Dr. DeLurgio, you commented very clearly, but maybe you can help us gain some perspective on what the pushback is likely to be, what the argument back is likely to be. We heard -- some of us heard, I'm sure, one discussion this morning talk about these are apples-to-oranges data sets, and the CONVERGE burden data is useless because they didn't use implantable devices. I don't actually know what any of that means. Maybe you can help us understand it better. And again, appreciate the context for the pushback.

Dr. DeLurgio, do you want to take that?

Thank you very much, Mike, and thank you for the question because that really gets -- it really shows some insight. I mean, why are people going to either like this or not like this? What are the issues? So I was tickled by the comment by Dr. [ Brystowski ], who I've known for 25 years. He admits he had to take the hawk position. And the apples-and-oranges comment I thought was a cute one. It was interesting, though, but even before that, he conceded that he has experience with the procedure, and it does work. So I thought that, that was a nice way for the hawk to open up. What he meant by apples and oranges is that the procedures are quite different from each other. And of course, we all recognize this. The reason why the procedure has to be different is because the standard procedures have limited success rate and are fraught with redos. And I think this is something that we all realize about endocardial ablation of persistent Afib. So the apple -- if the apple is the control arm, it was more or less your standard ablation. I mean, it's kind of what you're going to see in almost every radiofrequency catheter ablation trial where the veins are isolated and there may be some additional lesions applied. And so that had to be our control at the time the procedure was developed. It made perfect sense -- at the time of trial was developed, it made perfect sense to have this type of lesion set to serve as a control. And even in the other trial you saw today, it had a very same lesion set. And actually, in the majority cases performed, it's the exact same catheter that we use in endocardial ablation in this trial. So you had to have a control. Now we built on that with the epicardial lesion. So I guess that's the orange. It's a different kind of procedure, and it offers something new, durable isolation of the posterior wall. Now some people will say they could do isolation of the posterior wall endocardially, and it's not considered the standard therapy right now by anyone because, number one, it's not necessarily very safe. There's a high risk of ablating the esophagus and causing problems. Number two, it's hard to do durability. And I guess number 3 is, there's still debate on whether endocardial catheters used to ablate the posterior wall will improve the results. That's kind of gone back and forth. So there's a big difference. So people will push back because this is a new and different kind of procedure. I think what's important, though, is it's randomized data, and this is what we need. We're doing basically the same thing with an add-on in the experimental group. And it's very clear that, that add-on procedure improved the results dramatically, 30%. That's a big difference to achieve that sort of relative difference, the absolute difference of 17.7%. So yes, there's likely to be pushback because it does involve people to think a little out of their box. But I will point out to you that as we -- as this trial moved along, it became hard to enroll patients because the people who are doing -- who had familiarity with it, they didn't want to randomize the patients. They wanted to do them all with the Convergent procedure. So we have that usual problem where people were starting to develop their own opinions as the trial moved along. I think that's going to be our major hurdle, it's just getting people to realize that they can change their ways a little bit. Another little headwind is what we talked about earlier, which is working together. When surgical ablation of Afib came out initially, I felt like I was being marginalized as an electrophysiologist. They basically just wanted me to send my patients to the surgeon, let them do their thing and then get the patient back. But this is very different. I get to help my patient make a choice that this procedure is right for them. I collaborate with my surgeon who does the portion of the procedure that I cannot do. And then I do the portion of procedure that seals the deal. And it's a great collaboration. So I'm involved from start to finish and the surgeon is involved, and we all feel like we're working together. And it's been very successful. I feel like it's really helped our program quite a bit. So it's a little hill, a little speed bump to get over. But once you get over it, then things really start to roll.

Your next question comes from Mike Matson from Needham.

I guess, for the physicians, I just wanted to ask about the importance of the secondary end point around AF burden relative to the primary end point. Those numbers look a little more impressive. But I mean it is a secondary end point. So just any thoughts there would be helpful.

Dr. DeLurgio, do you want to start? And then maybe Dr. Calkins can chime in after that.

Sure. Yes, AF burden reduction is kind of like a new way of looking at the effectiveness of ablation. So we wanted to try to incorporate that into our analysis, if that was possible. And so the concept is that it's very difficult with any technology to completely eliminate all episodes of atrial fibrillation. But you can take a group of patients who have a huge amount of Afib, like persistent and long-standing persistent atrial fibrillation, this is essentially 100% Afib burden. And then if you can reduce that to a very low number, you can achieve great clinical outcomes. So even though there might technically still be some small amount of remaining Afib episodes. If it's a very small proportion at the time, those patients can still achieve a great clinical result. And that takes us back to the CASTLE-AF trial, where they showed by continuous monitoring through defibrillators that were implanted in patients with heart failure, when they did ablation -- standard ablation and they reduced the Afib burden, they showed that those patients, even though they were not completely free of AF, actually had better survival and less heart failure symptoms and remodeling of their heart. So we're trying -- we wanted to address that issue within the confounds of our -- confines of our trial design to try to show that in addition to meeting a primary end point, we could also show that the amount of Afib patients had was significantly reduced. So reducing it more than 90% so that patients are in Afib less than 10% of the time was a goal we tried to measure at 12 months.

Yes. This is Hugh. I'll just comment on the -- when you think about efficacy of AF ablation, a lot of people like to poke fun at the -- the current definition is freedom from Afib, A-tachycardia or A-flutter more than 30 seconds at 12 months. And then people say, "Well, who says 30 seconds is important? Why did you pick 30 seconds? Why not 3 minutes, 3 hours, 3 days, 3 weeks?" And because of that, there's a movement afoot to start to assess Afib burden, the percent time in Afib. And obviously, the problem with assessing Afib burden is how are you going to measure it? Are you going to put implantable monitors in everyone in the study? Are you going to -- you do 24-hour monitors or 7-day monitors or whatever? And obviously, in a randomized study, as long as you use the same tool to assess burden in both arms, you have a comparative group. So I think that's the reason that the Afib burden was included as a secondary end point. And the results, I think, aren't surprising and are consistent with the enthusiasm that has been shown for this procedure with over 11,000 of these procedures already performed before we had randomized data to support it.

Next question?

Okay. And then -- yes. So do you think this will result in any guideline changes? And how important would that be to commercial success? And how long do you think that would take?

So I'll just comment, this is Hugh, that these consensus documents have generally been put out by the HRS and the other societies every 5 years. The last one was 2017. So I would presume the next one would be in 2022. And obviously, data from prospective randomized trials is extremely important in powering these guideline recommendations. So I think the recommendations for hybrid surgical ablation, I would think, the strength of evidence has just jumped up a notch, and this will push that procedure forward. But that -- just because -- there's very few prospective randomized trials in the Afib ablation space. And so they really are important when they become available.

Your next question comes from Matthew O'Brien from Piper Sandler.

Congrats. Dr. DeLurgio, you mentioned a little bit as far as what some of the pushback maybe from some of your colleagues and peers out there as far as adopting this. But you talked about burden a little bit. There was some commentary about the size of the atrium. The control arm was, I think, a little bit higher as far as the efficacy versus some other single-center studies that we have seen. And then the patient number, again, on the control arm was fairly small. So when you put that all into totality, how big of a level of pushback do you anticipate as the data starts to kind of proliferate across the clinicians here in the U.S.?

Well, I think that there will definitely be increased adoption, and it's -- that's hard for me to predict, not being a real market analyst. But I do think that what we've shown is that when you compare the type of ablation most people are currently doing, the vast majority of people, when they approach someone with persistent Afib, are doing the type of ablation we did in the control arm. And when you realize there's a therapy that does not require the electrophysiologists to do something themselves is more difficult, in fact, it's easier for the electrophysiologist to do a Convergent procedure because of the prior epicardial ablation, it doesn't require them to do something more difficult, doesn't require them to buy more unusual technology, but basically confirms what has been sort of debated around and has been supported by a lot of articles on CONVERGE that just haven't been controlled, I think it really gives credence to the uncontrolled multiple conversion published data, including from our own institutions, showing that it's an effective procedure. So yes, there must always be some resistance to change, and it requires people to work this into the way they are thinking about treating their patients. My personal view, when I speak to groups that are interested in adopting CONVERGE and want to know about it, I try to show them how it fits into the spectrum of atrial fibrillation. And it's a large untreated portion of the population with this persistent and long-standing persistent Afib that our bias is that we can't get good results, and we now can offer a procedure where it's often one-and-done with really good results. And I draw attention to some of our data. We have put implantable loop recorders that last for 3.5 years in our patients. And we have seen that more than 90% have less than 5% Afib burden even out to 500 days on average. So I think it's going to catch on. And it's our job, I guess, to represent it to people in a way that they can embrace it as a part of their armamentarium.

Yes. Let me just make one comment. I think one of -- in terms of barriers to adoption, I think one barrier that people probably suspect exist that doesn't is the issue about trying to get the electrophysiologist and the surgeon together on the same day in the same room. From an EP perspective, the surgeon is taking up their procedure room or whatever. I think that logistically can be difficult in some centers. But what Christian has told me, and then maybe you can comment, is that you can also do this as a staged procedure. The surgeon does his part first. And then a couple of weeks or a month later, they come back and finish up the pulmonary veins with the catheter-based approach. So I think depending on which approach is most comfortable in a given hospital, it could be the 2-step or the -- both combined as a single procedure. But maybe, Chris, you can comment.

Yes. Thank you. This is Christian. Yes, exactly. I think there are several ways to do this. In our center, we do probably about 90% of them as a combined procedure in the EP lab. Now that being said, the other 10% are done as a staged. And quite interestingly, I've been involved in the users group for this procedure, developing guidelines, et cetera, for several years. And I think over 50% of the procedures currently being done are being done in a staged fashion. And there's certainly logistical appeal to doing it that way. We've just kind of, from the very beginning, had adopted a single-stage procedure, one anesthetic for the patient and doing it all together. It does tie up the EP lab for a longer period of time than doing it staged, and it does require the coordination of 2 different teams. There's 2 ways to look at that. One is it was maybe logistically challenging. Two is I think it kind of also helps collaboration and kind of helps promote the development of a heart team centered around Afib. It also provides the operator, the surgical operator with instant feedback. So that's been a huge plus from my perspective. But I think that it can be done either way, and it really doesn't make a difference in terms of outcome. Other people think there's benefit to doing it staged. And that you do the surgical procedure, you give it 3 months for those lesions to heal, and then the EP comes back and maps it out after those lesions have matured, so they know kind of what the definitive results of that surgical procedure is. So I mean, I think there are several ways to do it. And I think each team kind of has to figure it out for themselves what makes sense for them. But it really doesn't make a difference. Last comment I'd make is that in the MedStar system, there are centers up in Baltimore. And those -- some of those electrophysiologists, they don't have a surgical -- a cardiac surgeon in their hospitals. And they'll do an ablation, typically done 1 or 2 ablations. They'll send them to me. I'll do my portion, the surgical portion, and then send them back. And then they're either taken into lab if they have recurrent Afib or not. But there's -- and that's an interesting pathway because it allows EPs in the community that maybe don't have a cardiac surgeon to tap into a surgical center that does this procedure to kind of get that adjunctive or the additive benefit without having to have a formal program. This is another interesting wrinkle. But I think the bottom line is it really doesn't make a difference whether you do it as a staged. And I think each center can kind of figure it out for themselves.

Your next question comes from Suraj Kalia from Oppenheimer.

Congratulations on the trial, well done. Dr. DeLurgio, a bunch of questions, if I may. So first and foremost, was there any -- or is there going to be any subgroup analysis between long-standing persistent AF and those who have been relatively recently diagnosed? And what does epi plus endo ablation mean for the substrates of these 2 cohorts, if any?

We have not done a subset analysis yet, but I think that's something that we are interested in looking at because we do have a large cohort of long-standing persistent AF ablation patients. The -- my view of the substrate of what's happened with persistent and long-standing persistent Afib is that as substrate progresses, it probably starts progressing early in our lives. And then at some point, we get paroxysmal Afib and the substrate continues to regress over time with aging and continuous heartbeat and episodes of Afib. And then it becomes persistent. And if it's not dealt with, it becomes long-standing persistent. So it's sort of just a continuous progression. So my bias is that if you compare large groups of patients with persistent to long-standing persistent Afib, you will find more advanced substrates in the patients with long-standing persistent Afib. But whether or not this procedure performs better in one group or the other has to be determined by a subset analysis. I believe that any time you get enlargement of the atrium or get it all beyond paroxysmal Afib, that tells me that the substrate has already started to develop. And if we just isolate the pulmonary veins, we're going to have limited success. And that's why I consider all patients with persistent Afib as potential candidates for this procedure. And I don't really discriminate in my clinical practice between persistent and long-standing persistent.

Got it. And Dr. DeLurgio, forgive me, I'll just kind of throw a couple of questions in this one itself. What was the prespecified margin of inferiority? And did the control arm behave per the prespecified? And also, do you envision LAA closure becoming part of the protocol moving forward? Because there is some evidence out there that LAA closure also is incrementally removing some of the arrhythmogenic foci.

Sure. Thank you. Well, in terms of the -- there was no prespecified margin since this is a superiority trial. So the concept was to randomly assign patients and with -- there were -- with some assumptions about effectiveness based on historical controls to decide the size of the study. With regard to your second question about left atrial appendage closure, so we are very eagerly awaiting randomized data on this question as well. As you know, the aMAZE trial has been fully enrolled and in its follow-up state. And in that trial, patients with persistent Afib were randomized to ablation with or without left atrial appendage closure and silencing. Now the hypothesis is that it deals with the potential for superior outcomes when the left atrial appendage has been silenced electrically. And then there's nonrandomized data that -- from other trials that served as a basis for conducting that trial. Now currently, people are jumping the gun a little bit because of the excitement over this. And when the Convergent procedure is performed nowadays, just over half of cases are being done with left atrial appendage silencing and closure with the AtriClip. And preliminary reports from sites that are collecting that data in a nonrandomized fashion have shown an incremental improvement in outcomes. So while it's not my understanding that a randomized trial is in the works, the data from the aMAZE trial will certainly be very interesting. And because the AtriClip is available for commercial use, many centers are already incorporating that into their strategy.

Yes. This is Hugh. I just want to comment. I mean, the whole -- as we talked about, in Afib, we don't know what else -- how else to improve outcomes. And the 2 -- I think the top 2 targets people have talked about are the posterior wall, and there's been many people that sort of advocated that, that's got to be an important part of the equation. The second is the appendage. And so what's -- through these 2 trials, one that's done and one that we're going to hear about probably in 6 to 12 months, we're going to know the answer. So you could imagine that 2 years from now, we might be doing the -- doing a combined procedure in every persistent patient.

Yes. This is Christian Shults. I'll just comment that for the last 2 years, that's how I've been doing every commercial patient is posterior wall ablation with thoracoscopic clip. It adds 30 minutes to the procedure. And for all the reasons mentioned, the interest in theory and belief that clipping the appendage not only adds -- not only removes a lot of the stroke burden but also adds to the ablation. And there's surgical literature to support that. And I think there are a lot of sites throughout the country, I don't know the exact number, but among the users, the mature users, most are doing that.

Next question comes from Danielle Antalffy from SVB.

Congrats on a really strong trial. I guess I'll ask my 2 questions together. The first question I had was specific to the trial. And it looked like there was a higher percentage of long-standing persistent patients in the control arm. Just curious if there's anything to read into that. Could people poke holes in that, i.e., maybe the control arm would have done better, otherwise? And then on my follow-up, in line with that, is there anything from this trial that could limit the patient population, like, by my math, the $1 billion market opportunity you cite would reflect low single-digit-ish penetration of what we pay, I guess, in the persistent and long-standing persistent patient population. So can you give a little color on what that $1 billion assumes from a penetration perspective?

Sure. Dr. DeLurgio, do you want to try the first one on the long-standing persistent one?

Sure. Yes, there is a difference in the numbers. It's not statistically significant. But when you look at it grossly, you can see that there's a slight increase in number of long-standing persistent AF patients in the controlled catheter compared to the study arm. So it's not statistically significant. So we wouldn't expect it to have a major outcome, but that could be part of a subset analysis just to try to break that down to see how those patients did in either arm to see if it could have affected the primary end point. So that would have to be pending some sort of a subset analysis.

And then, Danielle, as it relates to the overall market, our belief is that long term, obviously, once we get through the FDA process and we are able to get an approval for this approach, at that point in time, we'll be able to -- when you look at the number of catheters that are being done today, there are reports of whether it's 60,000, 100,000 of the persistent and long-standing persistent patients in the U.S. are getting treated with catheter ablations today. If we're, as Dr. DeLurgio said, additive to that, we are able to get 100% penetration on that, that obviously begins to start to build out the market sizing that you're talking about. On top of that, there are patients that aren't getting treated today, as I mentioned, and you can add on to that. So you can begin to see obviously a lot larger than the numbers we have today at 1,800. We're going to take a pragmatic approach. We do think that it's really important to have kind of a discussion and a debate and have these conversations like we're having on this call today. As I mentioned, you'll see 2021, where we'll begin to kind of build those conversations after we get the approval and then move that into '22, '23, '24 as it becomes much more widely adopted and people begin to have conversations about the different successes that they're having. Okay. Operator, are there any more questions?

We have a question from Marie Thibault from BTIG.

Marie Thibault from BTIG. Doctors, thank you for lending your expertise to this discussion today. I really appreciate it. For the 2 doctors, Dr. DeLurgio and Dr. Shults, who already performed the procedure commercially, I'm curious whether you expect this data to change your use of the Convergent procedure now that the data is out there. And if so, how might that change?

So from my...

Go ahead, sorry.

Yes. This is David DeLurgio. From my standpoint, yes, we expect continued growth in our local program. Our surgeon, who has been made aware of the results, of course, is very excited about it. And so that helps fuel his interest. And so we've had discussions about bringing on an additional surgeon who could add more availability. And I think that my partners, who have not been as frequent users of this procedure as I have, have also expressed a lot of interest as well. So in our program, we have 9 electrophysiologists, and we're just an example of a large kind of academic group. And only 3 of us have ever really done the hybrid ablation, the Convergent hybrid ablation. So now there's a lot more interest. So we see this as being kind of confirmation that most people who were not already sort of interested into that team.

Yes. This is Christian Shults. I would agree with that. And I think the other interesting question about this, and I alluded to this in my opening remarks, is I think that as opposed to the commercial patients, which most of them have had 1, 2 or 3 ablations, these are all de novo patients. And I think it raises a question. Currently, in our center, almost all the patients I do are prior ablated. But it raises a question, should this be a first-line therapy for persistent and long-standing persistent? And should -- instead of having 1 or 2 ablations prior to this, should we just move forward with CONVERGE? I think it's an interesting discussion. I think that there's a potential to open up in terms of number of cases on that front. I also agree that I think that in my experience in talking to a lot of surgeons and other EPs, I think there are a lot of people on the fence. And they're on the fence for lack of definitive data, which now we have. And I think it has the potential. This trial does have the potential to move, kind of give people on the fence the appropriate nudge towards the procedure to give it a try or to use it more perhaps than they're currently using. So I do -- I see our utilization increasing.

Great. I guess my follow-up, reflecting on the EPs field and the long history of treatment techniques, to treat this patient group without much success, as we consider an FDA panel reviewing this data and this novel technology against that background, do you think there are any specific discussion topics your fellow EP colleagues on that panel might focus on? Just if there's anything that comes to you off the top of your heads on that.

Well, this is Hugh. I mean it's clear that everyone on that panel on the FDA is going to be focused like a laser both on the -- it's basically about the balance of efficacy and safety. And a lot of that is above all, do no harm. So it's a lot of focus on safety. And I think one thing that was -- that I learned about this procedure is most of the tamponades that occurred, occurred late and they were very different than what you see. Dealing with the catheter ablation procedure, we see acute tamponade and pressure drops as an emergency, you got to get pericardiocentesis done. These were inflammatory effusions where a patient shows up a couple of weeks or 3 weeks later, a little bit sluggish or whatever, they would have a little blood -- reduced blood pressure, but lo and behold, has an inflammatory effusion, which you tap sort of in a relaxed way and then put them on an anti-inflammatory. If I'm incorrect, Christian, you can probably correct me, as they now know in terms of best practices that all these patients should be treated upfront with colchicine and nonsteroidals, and that would prevent that effusion rate that at first blush seems to be the one sort of complication that's sort of out of line.

Yes. That's right. The -- I think Dr. DeLurgio mentioned this in his remarks, that 3 of the 4 pericardial effusions, those early pericardial effusions, those patients did not have recommended mitigation strategy. And I think that's something that we've learned in our experience. And we're actually probably going to be publishing a paper shortly with kind of best practice guidelines for adopters of this procedure. And one of the points is that you have to have a pericardial effusion or pericarditis mitigation strategy. I think it's part mitigation strategy. It's part kind of awareness and vigilance on the part of physicians in educating the patients in terms of what they should expect and what should alarm them if it occurs. The other thing that's interesting is in the trial, we started implementing an echo -- follow-up echo. And I think that's helpful as well. It's something I've done with patients is that to kind of, again, mitigate the possibility of developing an effusion is having them follow up within 1 or 2 weeks with an echo just to see if they're beginning to develop an effusion. In the vast majority of cases, this is something that can be treated medically if it's discovered. It doesn't require an additional procedure. But it just requires kind of vigilance and being aware. And I think from my experience, I mean, this is something that we had kind of early on, it really hasn't been an issue in the last 100 or so patients that I have done this procedure on. And I think that is largely due to the fact that we understand it. We can predictively prevent it, reliably prevent it and also kind of understand what to look for in follow-up to clue us in to -- that it may be occurring. So...

I'm showing no further questions at this time. I would now like to turn the conference back to Mike Carrel for closing remarks.

Well, first and foremost, I really want to thank everybody for joining us today and listening to the results and listening to our doctors and physicians present them and answer questions today. I'd also like to thank Dr. DeLurgio, Dr. Calkins and Dr. Shults for joining us, spending the time to explain it. I thought it was an incredibly rich discussion about the procedure, and I'm sure there will be many more like this over the coming months and years as the procedure gets more widely adopted. Again, thank you for joining us today. You can tell why we're excited about this. Stay safe, and have a great day.

Ladies and gentlemen, this concludes today's conference. Thank you for your participation. Have a wonderful day. You may all disconnect.