AtriCure (NASDAQ:ATRC) management outlined a plan to grow revenue to $1 billion by the end of the decade, pointing to underpenetrated cardiac surgery markets, expanding pain management applications and a pipeline of clinical trials and new products during a presentation at the Goldman Sachs Healthcare Conference.
Chief Executive Officer Mike Carrel said AtriCure expects to generate more than $600 million in revenue this year and has set a “Vision 2030” target of $1 billion. He said the company’s core business remains arrhythmia management in cardiac surgery, where AtriCure holds more than 90% market share in its served areas.
Clinical Evidence Seen as Competitive Advantage
Carrel said AtriCure has prepared for competition by investing consistently in product development, clinical evidence and its field organization. He said the company has invested 18% to 20% of revenue in research and development, including clinical trials such as LeAAPS and BoxX-NoAF.
“If you have great technology, then you combine that with robust randomized controlled data, it’s painful in the short term because it costs you money and it takes time,” Carrel said. “In the long term, it creates an incredible moat.”
Carrel framed competition from larger device companies as validation of AtriCure’s markets. He cited Medtronic’s entry into the surgical left atrial appendage clip market with Penditure, saying Medtronic gained some share initially but later declined to about 5% market share in the U.S. after peaking around 8% to 9%, according to his comments.
Carrel said he does not yet know how AtriCure will compete against Edwards Lifesciences’ clip product, but added that the company is “prepared” and expects to compete through innovation, evidence and field support.
BoxX-NoAF and LeAAPS Highlight Pipeline
Chief Financial Officer Angie Wirick said AtriCure has improved the expected enrollment timeline for BoxX-NoAF by more than a year. She said the trial has two endpoints, with an initial view of data at 30 days post-enrollment focused on reducing postoperative atrial fibrillation, followed by a three-year patient follow-up.
Wirick said the company also expects LeAAPS data in a similar timeline and described the two studies as major data-driven initiatives in the company’s R&D program. She said AtriCure also plans to launch another AtriClip device for open chest procedures next year.
Wirick said positive trial data could expand the market in cardiac surgery by supporting ablation and appendage management across a broader patient population, including patients regardless of whether they have atrial fibrillation.
PFA Pressures Hybrid Ablation Business
Carrel said pulsed field ablation, or PFA, has not affected AtriCure’s open chest concomitant cardiac surgery business and is not expected to do so for a long time. However, he said PFA has placed pressure on the company’s hybrid ablation business, which treats patients with atrial fibrillation as their primary condition.
Carrel said that portion of AtriCure’s business declined almost 30% last year, though the overall company still grew revenue in the double digits. He said management expects pressure to continue this year but believes some longer-standing persistent atrial fibrillation patients will eventually require options beyond catheter-based PFA.
Wirick said AtriCure’s long-range plan assumes the hybrid business returns to growth and does not continue shrinking throughout the plan period.
Pain Management Business Expands Beyond Thoracotomy
Carrel said AtriCure’s pain management business began in thoracotomy procedures and has grown because clinicians can see patient benefits quickly after surgery. He said the company is now used in about 25% of thoracic procedures, with lung cancer patients representing a large portion of that market.
Carrel estimated there are about 150,000 thoracotomies annually in the U.S. and said AtriCure still has significant room for growth in that category. He also said the company is expanding into amputations, another market he described as about 150,000 patients in the U.S., with a larger global opportunity.
Carrel said early data suggests the technology may affect phantom limb pain, though he emphasized that AtriCure still needs to study the area further.
Guidance, Product Launches and Capital Allocation
Wirick said AtriCure was pleased with first-quarter performance, which came in at the high end of the company’s 12% to 14% revenue growth guidance, but management retained guidance because it remains early in the year. She said the year was expected to be more back-half weighted due to maturing product launches and easier comparisons in some European markets, including the U.K.
Wirick cited several products expected to contribute to growth, including AtriClip FLEX-Mini, cryoSPHERE MAX and cryoXT. She said FLEX-Mini is helping sustain strong growth in appendage management, while cryoSPHERE MAX is driving adoption by reducing procedure freeze times. She said cryoXT made a minimal revenue contribution in the first quarter but is expected to contribute more as additional accounts are activated.
On capital allocation, Wirick said AtriCure’s focus remains internal investment, given the company’s organic R&D pipeline and growth drivers. Carrel said potential acquisitions would be evaluated based on whether they could drive meaningful revenue growth over short-, medium- and long-term periods.
About AtriCure (NASDAQ:ATRC)
AtriCure, Inc is a medical device company focused on the development, manufacture and marketing of innovative therapies to treat atrial fibrillation (AF) and related conditions. Founded in 2000 and headquartered in Mason, Ohio, AtriCure has established itself as a leader in surgical ablation devices designed to interrupt the errant electrical pathways that cause AF. The company’s solutions are used by cardiac surgeons and electrophysiologists to reduce the risk of stroke and improve patient outcomes in the treatment of both paroxysmal and persistent AF.
The company’s product portfolio centers on its Synergy Surgical Ablation System, which delivers controlled radiofrequency energy in a minimally invasive format, and the cryoICE Cryoablation System, which offers an alternative ablation modality using precise freezing techniques.
