Sustainability of Strong Performance
Q: Is recent strong performance sustainable?
A: Management believes the momentum from Q2 is sustainable moving forward. They have resolved prior authorization challenges and have increased revenue guidance in both Q1 and Q2, reflecting confidence in the rest of the year.

Profitability and Cost Savings
Q: How sustainable are profitability improvements into 2025?
A: The company is achieving operating leverage and expects to continue driving top-line growth while gaining efficiencies. Savings come from a more targeted approach in Direct-to-Consumer advertising, reducing it from 17% of revenue last year to 12% this quarter, and reduced R&D expenses due to prior period prelaunch inventory costs that did not recur.

Future Growth Drivers
Q: What are the growth drivers for 2025 and beyond?
A: Management is confident about future growth due to strong patient outcomes, limited market penetration, and continued investments in technology and market access initiatives. They anticipate "profitable growth for years to come" and are excited about the company's prospects.

Inspire 5 Rollout Plans
Q: When will Inspire 5 be commercially launched?
A: FDA approval allows for a soft launch of Inspire 5 in Q4, with a full launch expected in 2025 after ensuring sufficient inventory and operational readiness. Initially, only a handful of centers will participate to confirm positive experiences before broader rollout ,.

Impact of Inspire 5 on Margins and Pricing
Q: How will Inspire 5 affect margins and pricing?
A: Even with flat pricing, Inspire 5 is expected to be gross margin accretive due to cost savings from eliminating the sensing lead. The company is still working through its pricing strategy prior to launch ,.

Guidance and Utilization Rates
Q: Will utilization increase sequentially every quarter?
A: Management aspires to increase utilization sequentially and year-over-year going forward, despite historical seasonality. They have confidence based on strong performance and strategic initiatives , ,.

Center Additions and Sustainability
Q: Are high numbers of new center adds sustainable?
A: The company remains consistent with its guidance and acknowledges that center additions can vary quarter to quarter. They are committed to opening centers when ready and will continue to find ways to increase patient access , ,.

GLP-1 Impact on Target Market
Q: How will GLP-1 therapies affect the target market?
A: GLP-1 therapies are seen as complementary to Inspire. Management is already seeing patients on GLP-1s receiving Inspire therapy, with over 1,500 patients identified. They expect significant future impact as GLP-1s help patients qualify for Inspire therapy by reducing BMI ,.

Operating Leverage and Sales Force Efficiency
Q: Is efficient use of the sales force sustainable?
A: Increased efficiency is sustainable due to the addition of field clinical representatives supporting each territory, allowing for leveraged growth without significantly changing the territory-to-center ratio.

Gross Margin and OpEx Trends
Q: What are expectations for gross margin and OpEx?
A: The company provides gross margin guidance of 83% to 85%, with year-over-year OpEx growth expected to be 17% over 2023. They anticipate being profitable in Q3 and Q4, continuing investments in R&D and commercial expansion ,.

Backlog of Waiting Patients
Q: What is the current patient backlog?
A: The time from patient contact to implant remains around six months, with efforts underway to improve capacity and reduce this time. Reducing the need for sleep endoscopy may significantly shorten patient experience.

Potential CPT Code Changes with Inspire 5
Q: Any CPT code concerns with Inspire 5?
A: Management plans to have coding ready and communicated as part of the training package. They do not anticipate needing new codes and expect to be in good shape regarding reimbursement.

Inventory Transition to Inspire 5
Q: How will existing Inspire 4 inventory be managed?
A: Centers are expected to work down their existing Inspire 4 inventory before transitioning to Inspire 5. The company does not plan to swap out devices, as both versions have similar functionality.

Center Dynamics and Deactivations
Q: What's behind recent center deactivations?
A: Deactivations are part of ensuring focus on productive centers able to care for patients. Some deactivations result from physicians moving facilities. This practice is consistent with past efforts to optimize resource allocation.

Impact of Simplified Procedure on Physician Fees
Q: Will Inspire 5's simpler procedure affect physician fees?
A: No immediate changes are expected. While procedure time may decrease, leading to efficiency gains, changes to physician payments would require updated surveys and are not anticipated for several years.

Feedback from Payers on Predictor Study
Q: Any updates on payers' response to Predictor study?
A: Management continues to work with payers regarding the removal of the sleep endoscopy requirement for low BMI patients. Some payers have already removed this requirement, aligning with the Predictor study findings.

Utilization at Top Quartile Customers
Q: How are top quartile customers performing?
A: Top centers perform between 3 to over 17 procedures per month. The company aims to move the entire distribution higher, focusing on increasing utilization at existing sites.

Possible One-Time Items in Q2
Q: Any one-off factors in Q2 affecting modeling?
A: Management did not observe any significant one-time items in Q2 that would impact sequential modeling. The strong quarter reflects genuine performance without anomalies.

Patient Funnel and GLP-1 Therapies
Q: Could GLP-1 use disrupt the patient funnel?
A: Management does not anticipate significant disruption. Patients starting GLP-1s for weight loss are likely to be started on CPAP simultaneously. With Inspire's waiting period of around six months, they do not expect a visible gap in demand , ,.

Surgeon Capacity Initiatives
Q: How is surgeon capacity being improved?
A: Initiatives include leveraging advanced practice providers, reducing operating room time with Inspire 5, and eliminating the need for sleep endoscopy in certain patients. These efforts aim to free up ENT capacity and enhance efficiency.

Revenue and EPS Outlook
Q: What is the outlook for revenue and EPS?
A: With revised revenue guidance and expected OpEx growth, the company implies continued profitability, anticipating being profitable in Q3 and Q4, while maintaining investments in growth ,.

Secondary Sites of Service
Q: How do secondary sites factor into center adds?
A: Approximately 24% of overall centers are secondary sites of service, often used to expand capacity. This affects the number of centers and utilization dynamics.

Modeling Q3 Utilization
Q: Why expect sequential increase in Q3 utilization?
A: Management aims to increase utilization sequentially, despite prior year seasonality. Confidence comes from positive trends and progress in strategic areas.

Operating Leverage in Q2
Q: Is the Q2 operating leverage repeatable?
A: While continuing to invest in growth, the company expects to maintain operating leverage but balances profitability with investments in R&D and commercial efforts.

Disruptions from GLP-1 Therapies
Q: Any evidence of GLP-1 causing air pockets?
A: Management is already observing patients on GLP-1s receiving Inspire therapy and does not expect significant disruptions. They believe GLP-1 therapy is complementary to Inspire ,.

Backlog and Patient Wait Times
Q: Is the patient backlog impacting business?
A: The six-month backlog remains a focus area, with initiatives to reduce it by increasing capacity and eliminating unnecessary procedures like sleep endoscopy for certain patients.

Gross Margin and Unit Costs of Inspire 5
Q: What are the unit costs of Inspire 5 vs. Gen 4?
A: By eliminating the sensing lead, Inspire 5 reduces costs and is expected to improve gross margins. Specific cost savings are not yet quantified.

Liability Concerns over GLP-1 Therapies
Q: Do physicians have liability concerns with GLP-1s?
A: Sleep physicians prefer not to leave patients untreated while waiting for GLP-1s to reduce weight. They are likely to start patients on CPAP concurrently to ensure treatment, minimizing any liability concerns.

One-Off Items in Q2 Affecting Modeling
Q: Any one-time factors in Q2 results?
A: There were no significant one-off factors in Q2. The performance reflects genuine operational success.