Edwards Lifesciences Corp. (NYSE:EW) Q4 2014 Earnings Conference Call - Final Transcript

Feb 03, 2015 • 05:00 pm ET

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Edwards Lifesciences Corp. (NYSE:EW) Q4 2014 Earnings Conference Call - Final Transcript

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Presentation
Operator
operator

Greetings, and welcome to the Edwards Lifesciences Corporation Fourth Quarter 2014 Earnings Conference Call. (Operator Instructions) As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Mr. David Erickson, Vice President, Investor Relations. Thank you. Mr. Erickson, you may begin.

Executive
David Erickson

Welcome, and thank you for joining us today. Just after the close of regular trading, we released our fourth quarter 2014 financial results. During today's call, we'll discuss the results included in the press release and accompanying financial schedules and then use the remaining time for Q&A. Our presenters on today's call are: Mike Mussallem, Chairman and CEO; and Scott Ullem, CFO. (Forward Looking Cautionary Statements) Also, a quick reminder that when we use the terms underlying and excluding special items, we are referring to non-GAAP financial measures. Otherwise, we are referring to our GAAP results. Additional information about our use of non-GAAP measures is included in today's press release and on our Web site. Now I'll turn the call over to Mike Mussallem. Mike?

Executive
Michael A. Mussallem

Reflecting on 2014, we ended the year with uncertainty around our product launch timing and new competitor activity. We are pleased to have exited the year with momentum and having significantly exceeded our initial expectations. We were proud to introduce several innovative products that helped us maintain our strong global leadership position and resulted in annual underlying sales growth of 13%. This growth was led by 29% underlying sales growth in transcatheter heart valves. Importantly, we're particularly gratified to see the meaningful impact that our dedicated employees are having

Executive
Michael A. Mussallem

in helping so many patients around the world. For the quarter, we experienced robust growth across all regions with transcatheter heart valves sales that exceeded our expectations, most notably in Europe, driven by the further adoption of SAPIEN 3. Other new products like our minimally invasive intuitive valve platform and ClearSight also contributed to our growth. Now turning to quarterly specifics. Total adjusted sales were $640 million, representing an representing growth rate of 16%. In transcatheter heart valves therapy, underlying global sales grew 38%. This was driven by strong sales of our innovative new products in Europe and in the U.S. Globally, average selling prices remain stable.

Outside the U.S., THV sales grew 41% on an underlying basis during the quarter, once again driven by the strong procedural growth in Europe and the ongoing launch in Japan. Growth was seen broadly across most countries in Europe which speaks to the large number of untreated patients benefiting from strong TAVR adoption. SAPIEN 3 with its enhanced features represented more than 85% of our European THV sales this quarter, and continues to generate favorable clinician feedback.

We estimate competitors moderately gained ground in the quarter. While we expect procedure growth rates to slow going forward, we estimate that Europe TAVR procedures grew in excess of 20% in 2014. In Japan, we ended the year slightly below our full-year guidance of $40 million to $50 million. Even though clinicians remain enthusiastic about our