Q4 2023 Inari Medical Inc Earnings Call
Participants
John Hsu; VP of IR; Inari Medical, Inc.
Mitch Hill; CFO; Inari Medical, Inc.
Drew Hykes; President and CEO; Inari Medical, Inc.
Thomas Tu; CMO; Inari Medical, Inc.
Travis Steed; Analyst; Bank of America Global Research
Adam Maeder; Analyst; Piper Sandler Companies
Kallum Titchmarsh; Analyst; Morgan Stanley
Lawrence Biegelsen; Analyst; Wells Fargo Securities, LLC.
Marie Thibault; Analyst; BTIG LLC
Will Plovanic; Analyst; Canaccord Genuity
Chris Pasquale; Analyst; Nephron Research
David Rescott; Analyst; Robert W. Baird & Co.
Richard Newitter; Analyst; Truist Securities
Mike Matson; Analyst; Needham & Company
Presentation
Operator
Good day, and welcome to Inari Medical's Fourth Quarter and Full Year 2023 conference call. At this time, all participants are in a listen only mode at the end of the Company's prepared remarks, we will conduct a question and answer session. As a reminder, this call is being recorded and will be available on the company's website for replay shortly. And now I will turn the call over to John Hsu, Vice President of Investor Relations. Please go ahead.
John Hsu
Thank you, operator, and welcome to Inari's conference call to discuss our fourth quarter and full year 2023 financial performance. Joining me on today's call are Drew Hykes, President and Chief Executive Officer, and Mitch Hill, Chief Financial Officer. This call includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Statements made on this call that do not relate to matters of historical fact should be considered forward looking statements, including statements related to Inari's estimated full year 2020 for revenue, operating loss or profitability expectations and the expected operating performance and potential strategic benefits of Linde flow are based on Inari's current expectations, forecasts and assumptions, which are subject to inherent uncertainties, risks and assumptions that are difficult to predict.
Actual outcomes and results could differ materially from any results, performance or achievements expressed or implied by the forward-looking statements due to several factors, please review Inari's most recent filings with the SEC, particularly the risk factors described in our latest Form 10 K for additional information. Any forward-looking statements provided during this call, including projections for future performance are based on management's expectations. As of today, Inari undertakes no obligation to update these statements except as required by applicable law.
On today's call, we will refer to both GAAP and non-GAAP financial measures in announcing our Q4 and full year 2023 results. Please refer to today's press release for a reconciliation of the non-GAAP measures discussed on this call and referred to in the press release press release in the slides accompanying this call are available on our website in Inari medical.com and a recording of today's call will be available on our website by 5 p.m. Pacific time today with that, I'll turn the call over to Drew.
Thank you, John, and thank you for joining our call today. We are thrilled with our Q4 and full year 2023 performance in the fourth quarter, we achieved record revenue of more than $132 million, driven by strength in our core VT. business, strong growth from our emerging therapies portfolio and continued traction from international expansion. For the full year, we generated revenue of over $493 million, reflecting 29% growth for the year we also made meaningful progress on our path to profitability positioning in RA for sustained operating profitability in the first half of 2025, despite the incremental operating deficit support associated with our lead flow acquisition. I would like to thank our team for their hard work to make this year a success by every measure.
We are succeeding in our goal to drive strong adoption of our market-leading PE. and DBT. therapies, while also executing on our plans to expand internationally and diversify commercially into sizable new patient populations that are underserved by today's standard of care. This expansion to new patient populations included the acquisition of Linde flow, which we announced and closed in Q4. Lymphomas purpose-built system allows for the transcatheter virtualization of the deep veins and is indicated to treat patients with chronic limb threatening ischemia or CLTI.
This technology addresses a spectacular unmet need for these patients, providing new hope and an important new treatment option. I'll have more to share about our progress and some flow later in the call. Going forward, we will begin providing a new revenue breakout that we believe better aligns with the three growth pillars of our business. Specifically, we'll report revenue from our global VT. portfolio and from our global emerging therapies portfolio. While also continuing to break out U.S. and international revenue mix. We'll have more to share about this new framework in his remarks.
Before turning to these growth pillars, I wanted to share as we always do a story about the incredible impact our technology has on patients recently a 30 year old woman, just two weeks post Farnam presented to an ER in Louisiana was severe trouble breathing and leg swelling as a complication from a recent pregnancy. This young mom was diagnosed with both a pulmonary embolism and a clot in her inferior vena cava or IDC a life-threatening situation. After consulting with our physicians, she decided to undergo thrombectomy first or physicians use the new Class three for XL catheter to effectively remove all the clocking or IBC as it was purpose-built to do. The Procuri sheet was also used adjunctively to protect against the risk of clot embolization.
Next for pulmonary embolism was successfully and efficiently treated using the T. 24 catheter. After a short hospital stay, the patient was able to return home to a newborn baby and family for a successful outcome was made possible by the scale of recruiting physicians and the breadth and depth of NRT's purpose-built toolkits across both DBT. and PE.
During 2023, we surpassed 130,000 cumulative patients treated globally, including this young mom. This was a humbling milestone for our organization, but despite our success to date, much more work remains and we believe we're in the earliest phases of the impact we can have on patients globally across multiple disease states. I will now provide an update on each of our three growth pillars starting with VTE, which we believe represents a $6 billion TAM in the US alone.
Our growth strategy in VTE. continues to focus on commercial expansion, market development high quality, clinical evidence and continuous innovation. Commercially, we remain committed to our high-touch approach. We continue to split territories, adding reps selectively at a measured pace in areas with the greatest need. Given our high level of national account penetration. As the pace of new territory adds continues to moderate, we've started to see some nice corresponding productivity gains.
Looking ahead, we remain confident ability of our world-class commercial team, the largest VTE. focused sales force in the industry to drive significant growth. Turning to market development, we're increasing penetration within existing accounts VIVTE. excellence, our comprehensive market development program, VT. excellence is a series of playbooks and activities that we systematically execute to help support hospitals and the development of VTE. programs.
The goal is analogous to the programs have been created in stroke, semi and Teva as we execute BT. BT excellence, our penetration into the TAM at the account level increases, and we are encouraged by the progress we are making today. In many of our most advanced accounts, we're now seeing TAM penetration rates above 50% most importantly, we believe VT. excellence is scalable and repeatable. On the clinical evidence front, we remain steadfast in our commitment to produce the highest quality clinical data to drive awareness and ultimately change the standard of care and VTE.
This commitment is reflected in the significant progress we continue to make across all three of our randomized controlled trials in fact, we just completed patient enrollment for Peerless, our trial randomizing FlowTriever to catheter directed thrombolysis. We were able to fully enroll this study in just over two years, a considerably faster pace than other currently enrolling RCTs. We look forward to the data readout in the second half of 2020 for enrollment for Defiance and privileged to are also tracking in line with our expectations currently across the industry, there are no fewer than seven actively enrolling RCTs each studying different aspects of VTE.
This represents an exciting new era of investment and shared commitment to change the standard of care for this huge underserved group of patients, but make no mistake, Inari continues to be the clear leader in this effort. Taken together we will study over 2000 patients in our three RCT.s more than those conducted by all other sponsors combined. We believe this high-quality clinical evidence will ultimately enable us to treat a significant portion of the 700,000 U.S. patients suffering from BTY. each year. Finally, we continue to innovate across our best-in-class toolkits to protect and extend our leadership position.
Over the past 12 months, we commercialized multiple new products to augment our VTE. franchise, including T 16 curve, FlowTriever XL and clot Super Bowl Gen two FlowTriever and client server systems, our fourth and third generation platforms, respectively, benefiting from six years of continuous iteration and improvement. However, we remain committed to further innovation within VTE. Next, I'll provide some updates across our portfolio of emerging therapies.
Our second growth pillar. The segment consists of four distinct patient populations outside of VTE., where we have identified an unmet need we believe we can address by leveraging our core competencies taken together. We believe these markets represent a $4 billion TAM in the U.S. alone, and we're just getting started in each beginning with chronic venous disease. We continue to be encouraged by the initial commercial traction of Revascor, the first mechanical thrombectomy device to treat venous stent thrombosis between incidence and prevalence pools. We believe the addressable market for our core totals nearly 50,000 patients, representing a $500 million U.S. TAM.
Looking ahead in 2024, we plan to launch the second purpose built tool within the CBD toolkit, further augmenting our portfolio and unlocking another portion of this significant TAM. Turning to dialysis access management, enteral continues to build commercial traction over the past several quarters and thrills of thrombectomy system designed for small vessels, including AV fistulas and veins in the upper extremities and below the knee. The combined total addressable market is 250,000 procedures per year in the U.S., representing an incremental $1 billion market opportunity.
Turning to CLTI. Since closing, the Limpopo acquisition in mid-November, we've made important progress and beginning to integrate the business into Inari. While also executing early US launch. We have successfully established the initial employee organization through a combination of Linde flow and in our personnel and a small number of external hires, we've undertaken important work to stabilize and build capacity across the supply chain, while also beginning to integrate Corporate Support Services commercially, the US launch is proceeding in line with our expectations.
We are successfully navigating back approvals and the completed initial series of commercial cases. We held our first training summit in late January and had great engagement and feedback from the event. We anticipate building momentum throughout the year, highlighted by incremental reimbursement via an endcap, which would go into effect in October. Taken together, we continue to view 2024 as a foundational year focused on physician training that approvals, thoughtful patient selection and deliberate wound care.Follow-up landfill offers New Hope and new options to the 55,000 no option CLTI. patients. We are encouraged by the progress we've made to date and accessing this $1.5 billion U.S. TAM.
Our last emerging therapies category is acute liver ischemia, a $600 billion U.S. TAM characterized by tremendous unmet needs and a lack of purpose-built tools. In fact, roughly 50% of ALI. patients today must undergo an open surgical procedure to successfully remove their clot. We remain committed to better outcomes for these patients and continue working to bring our second generation Rx system to market later in 2024. Finally, I would like to discuss our third pillar International. In Q4, we continued to see strong growth led first and foremost by our European franchise. Alongside Europe, we continued to gain incremental product approvals and are now commercial in over 30 countries globally.
Overall, international revenue was nearly 8 million in Q4, up more than 100, 30% versus the prior year. Looking forward, we recently received favorable incremental reimbursement in France. Also, we remain on track to treat patients in both China and Japan this year on a commercial basis, while international sales are just 5% of our total revenue today, given the spectacular unmet need and the investment we've made in establishing our international commercial footprint, we expect international sales to account for at least 20% of revenue over time. In closing, we're pleased with how the business performed in Q4 and 2023. For the year, we generated record revenue and strong growth of nearly 30%, driven by crisp execution across our growth pillars.
Our field team continued to drive patients toward frontline treatment with our therapies while working to support the development of VT. programs, we announced our third RCT and build meaningful momentum across new product launches, and we saw another record quarter and strong growth from our international business. In addition, we laid the foundation for strong sustained revenue growth. The expansion of our purpose still toolkits into new disease states with significant unmet need.
We also announced closed and began to integrate Linde flow our first acquisition. Finally, we delivered meaningful operating leverage while continuing to invest in burgeoning parts of the business going forward. I've never been more confident in the health of our business and our ability to generate meaningful revenue growth across our three growth pillars in 2024 and for many years to come. With that, I'll now turn the call over to Mitch.
Mitch Hill
Thanks, Drew. Before I begin, I want to share additional color on the revenue breakout. Drew described, we're pleased to be introducing additional visibility to our growth pillars by sharing the revenue contributions of our VTE. and our emerging therapies products. VT. includes sales of the entire class Trevor and FlowTriever product families globally. Emerging therapies includes our portfolio of products addressing on a global basis chronic venous disease, dialysis access management, chronic winter and into Scania and acute limb ischemia.
In our press release, we have provided quarterly historical revenue for these growth pillars going back to the start of 2022 to provide a sense of the strong growth and adoption we are seeing in all areas of the business. Please note that we will also continue to provide US and international revenue splits as we have done historically Turning to the fourth quarter and full year 2023 results. I know revenue in the fourth quarter of 2023 was $132.1 million, up 23% over the same period of the prior year. On a year-over-year basis, VT. drove more than 85% of the growth and emerging therapies accounted for roughly 15% of the growth. Gross margin was 87.1% for the fourth quarter of 2023 compared with 87.8% in the prior year period.
Operating expenses were $124.4 million in the fourth quarter 2023 compared with $100.5 million for the same period of the prior year. R&d expense was $22.9 million in the fourth quarter of 2023, up 12% compared with $20.4 million for the same period of 2022. The increase in R&D expense was primarily due to increases in professional fees and clinical and regulatory expenses. Sg&a expense was $101.5 million in fourth quarter 2023, up 27% compared with 80.1 million for the same period prior year. The increase in SG&A expense was primarily due to increases in personnel-related expenses from increased headcount, increased commissions due to higher revenue and professional fees, which are primarily attributable to the acquisition of lymphoma.
Also in December 2023, we received a civil investigative demand from the Department of Justice requesting information primarily related to meals and consulting service payments provided to healthcare professionals. We are cooperating with this investigation going forward. Legal and associated expert expenses related to this matter will be recorded in our SG&A expense. And I recorded a GAAP operating loss of $9.3 million in the fourth quarter of 2023 compared with a GAAP operating loss of $5.9 million for the same period in the prior year. On a non-GAAP basis, which excludes acquisition related expenses and acquired intangible asset amortization.
Fourth quarter operating loss was just 300,000. There were no non-GAAP adjustments related to our 2022 operating loss. Net loss for the fourth quarter of 2023 was $4.7 million compared to a net loss of $5.8 million for the same period of the prior year. The basic and fully diluted diluted net loss per share for the fourth quarter of 2023 was $0.08 based on the weighted average basic and fully diluted share count of $57.6 million. This compares with a basic and fully diluted net loss per share of $0.11 based on a weighted average basic and fully diluted share count of $53.6 million for the same period of the prior year.
Shifting to full year 2023 results, we reported revenue of $493.6 million, up 29% over the prior year. P/t accounted for over 85% of the growth, while emerging therapies contributed nearly 15% on a year-over-year basis, gross margin was 88% for the full year 2023 compared to 88.4% for the full year 2022. Operating expenses were $448.6 million for the full year 2023, up 22% compared with $367.1 million for the full year 2022, including one-time expenses related to the Winslow acquisition.
R&d expense was $87.5 million for the full year 2023, up 18% compared with $74.2 million for the full year 2022. The increase in R&D expense was primarily due to increases in personnel related expenses, materials and supplies, clinical and regulatory expenses and software costs and depreciation in support of our growth pillars. Sg&a expense was $361.1 million for the full year 2023, up 23% compared with $292.8 million for the full year 2022. The increase in SG&A expense was primarily due to increases in personnel-related expenses and professional fees, largely associated with the acquisition of lymphoma.
Gaap operating loss was $14 million for the full year 2023 compared with $28.1 million for the full year 2022. On a non-GAAP basis, which excludes acquisition-related expenses and amortization of acquired intangible assets. Operating loss was $2.4 million for the full year 2023. There were no non-GAAP adjustments related to our 2022 operating loss. Net loss for the full year 2023 was $1.6 million compared to a net loss of $29.3 million for the full year 2022 basic and fully diluted net loss per share for the full year 2023 was $0.03 based on a weighted average basic and fully diluted share count of 56.8 million. These compared with a basic and fully diluted net loss per share of $0.55 based on a weighted average basic and fully diluted share count of $52.8 million for the full year 2022.
Moving on to the balance sheet, our cash and investments at the end of the fourth quarter totaled $116.1 million. Our cash flows provided by operating activities were $35.9 million in 2023 compared to cash flows used in operating activities of $14 million in 2022 Turning to our 2024 outlook, we are reiterating our full year 2024 revenue guidance of 580 to $595 million for effect, reflecting growth of approximately 17.5% to 20.5% over 2023. Our guidance reflects contributions across all three of our growth pillars VTE. for emerging therapies and international for lymphoma. We continue to view 2024 as a foundational year and expect a modest revenue contribution. We currently anticipate sequential revenue growth of approximately 4% for Q1 2024 relative to Q4 of 2023 for 2024.
From a phasing perspective, we expect strong revenue growth momentum in the back half of the year. Turning to profitability, we are continuing to invest in our growth pillars while positioning the business to achieve sustained operating profitability. In 2024, we expect to see greater operating losses in the first half of the year than in the second half of the year. And as we shared earlier in the year, we continue to forecast reaching sustained operating profitability on a consolidated basis in the first half of 2025.
With that, I'll turn the call back to the moderator for questions for the Q&A segment. Drew, John and I will be joined by Dr. Thomas Tu, Inari's Chief Medical Officer. We will now begin the question and answer session to ask a question.
Question and Answer Session
Operator
(Operator Instructions) Travis Steed, Bank of America.
Travis Steed
Hey, thanks for taking the question. I wanted to ask about the DOJ investigation. You did you mention which I guess was the question I'd have on that is I know how broad is the investigation. When does it start? What are the next steps? How long you expect it to last? And do you expect it to have any impact on customers or revenue and 24?
John Hsu
Yes. Thanks for the question, Travis. This is Drew. I can get started on that. So as you likely understand from some of the precedent examples of other companies navigating the same waters. We're not going to have a lot of additional background. We can be able to share beyond what's in the disclosure we got the CIDI. back in December. And so it's still relatively early on. We are cooperating with the DOJ. We take compliance seriously today. We always have that every step of our commercial activity here in the US going back to 2018.
And we do not expect that this will have any impact on our ability to execute commercially on the focus of the CID. As described in the 10 K. It's a couple of very specific areas related to health care, professional relationships, some going forward. We'll update you as we can. But again, based on the precedent, I think the time line is most likely going to be measured in years as opposed to two months and quarters.
Travis Steed
Okay. Thanks for that. And then a question on the 24 guidance. I'm curious how you're seeing the core and that 17.5% to 20.5% guide when you look at the core for 2023, it was around 25%. So just curious why you're assuming, but just for the slowdown in the core business and 24 if it's just conservatism or anything else you'd call out on that?
John Hsu
Yes. I think in general, I'd probably start with reiterating what our philosophy is around guidance. And, you know, historically when we put out a number, we want to be highly confident in being able to deliver on that number. That's been our historical practice since that was certainly consistent with how we approach guidance here last month for 2024, we feel really good, very comfortable and confident in that guidance range of five 80 to 5 95. And that factors growth in across all three of our growth pillars. Certainly VTE. will be the majority of the growth and the revenue still in 2024.
We anticipate continued strong growth there from commercial expansion from taking share from a lytic based interventions from TAM expansion via market development efforts, new data innovation, all of that factored into the anticipated growth in the VTE., our pillar, emerging therapies, we're factoring in growth across all four of those new patient populations that we're beginning to do work in on certainly continued traction in CBD on enteral on new products coming out with Artix. And as you've heard us describe a modest contribution from wind flow.
And then finally, we're factoring in continued growth and strength internationally led first and foremost by Europe, but also factoring in contributions from from some of the other geographies as well. So we'll have an opportunity to discuss guidance again here in 60 days or so on the formal Q1 call. But in the meantime, we're going to continue to focus on execution and that we've always taken great pride in.
Operator
Adam Maeder, Piper Sandler.
Adam Maeder
Hi, good afternoon and thank you for taking the questions. I wanted to start with a Q4 question and apologies for the granularity with great granularity here, but I was hoping you could give us some color on Q4 in terms of kind of how that played out in terms of monthly progression and commercial momentum. Your competitor is talking about a pickup in their business in Q4, I think in the late November timeframe. I'm wondering if you have any reaction to that comment. And then just any early commentary that you can give us on your business thus far year to date and in Q1? Thank you.
Drew Hykes
Yes. Thanks for that. And so we saw a nice momentum building in Q4, particularly in the tail end of the quarter. And we saw that momentum carry over here into the beginning of this year. As you know, we don't normally provide detailed intra quarter commentary. But what I can tell you is that that momentum did carry over nicely into the beginning of this year. A January was a step up actually a nice step up from what we saw in December, and that momentum has continued here.
So taken together, we're feeling really good about how we're positioned here at the beginning of the year. We like the plan. The team is executing really crisply really consistently are seeing nice growth across all three of those growth pillars. And looking ahead from here, we see some really nice catalysts shaping up for the remainder of the year across those pillars, new territories and new data driving continued traction in VTE. on new products and new markets that we'll be getting started in with emerging therapies, contributions from Linde flow along the way there as well on.
And obviously some nice traction continuing internationally with Europe leading the way more geographies are contributing more meaningful ways and still on track in both China and Japan for treating patients in those two markets. So so far so good. We're feeling very confident in our position here and not only in Q1, but as we look out from here through the remainder of the year.
Adam Maeder
Thanks for the color there, Drew. And I guess for the follow up or I'll ask the question on competition as it relates to 2024, it the last Travis was asking about your outlook for 24, but was curious kind of what you're baking in from a competition standpoint, competitive standpoint for your guidance in 24, both from your primary competitor and then any new market entrants on the DBTDBT. side of things. Thanks for taking the questions.
Drew Hykes
Yes. So competition and competitive dynamics are clearly incorporated into our guidance. This is an attractive market. We are going to see competitive entrants become active in this market. Keep in mind, it's a $6 billion market, 6% penetrated. Our focus primarily historically and today remains on market growth and making the investments we believe are necessary to change the standard of care for this patient population. That's where we have focused on training, education and innovation, high quality evidence all those areas you've heard us describe before, all of them designed to drive market growth.
That's where the real opportunity is, how we're going to see competitive entrants. We factor that into our guidance, and we started 2023 as the clear market leader. We exited 2023 as the clear market leader, and we would absolutely expect to continue to be the market leader in 2024. That confidence and leadership comes from the performance of our products as the undisputed. So solid clinical data that we have, the new innovation the way our team is executing. All that gives us confidence.
We're going to continue to be the leader in this market, and that is despite what will undoubtedly be new entrants maybe the last point I'd make is to the extent we do have new entrants that can help participate in the market development work. That's obviously going to be constructive for everyone and ultimately constructive for patients.
Operator
Kallum, Titchmarsh, Morgan Stanley.
Kallum Titchmarsh
Please go ahead because I'm taking the question, I think one for Mitch here. But just on the gross margin side, I think 87.1% in the fourth quarter was a bit below where the Street was. I'm just keen to understand how we should be thinking about the setup for this in 2024? And maybe just some color on how you expect gross margins to trend longer term with these emerging products coming for I guess, are you still comfortable remaining in that mid to high 80% range longer term and for long term?
Mitch Hill
Thanks for the question, Salim. And in terms of the Q4 gross margin, we saw some impact from the acquisition. There's a portion of the gross margin decline that related to the Linde flow acquisition, even though that was just in the picture for about 45 days. We continue to see some margin impact due to the internationalization of the business as well as the new some of the emerging therapy products have a lower gross margin profile and then the kind of the key products that we've historically been selling.
So that's kind of a couple of different factors that affected the change in gross margin from Q3 to Q4. As we think about the gross margin in 2024, I would say we're going to likely have another quarter or so of margin kind of in the low 87% range. And then we probably actually look for some margin pickup in the second half of the year. And then longer term, we've messaged we still feel confident in our messaging about the gross margin kind of in the mid 80s. And there's a lot of different factors that kind of go into the stool when we put that together. But the overall we think this business has a premium gross margin profile.
We expect it'll continue to have that. We've kind of accounted for all the different factors in there as we kind of forecast that mid 80s percent gross margin over time.
Kallum Titchmarsh
Great. Thanks a lot.
Operator
Lawrence, Biegelsen, Wells Fargo.
Lawrence Biegelsen
Yes, good afternoon. Thanks for taking the question. Drew, historically, you've said the core USVTE. market was a 20% growth, 20% plus I think growth market. What are you seeing now? And what are your expectations for 2024?
Mitch Hill
Yes. We still see this as a massive market in the earliest stages of penetration, and we're making the investments to drive that market growth. And we're continuing to see a very robust backdrop of market growth. We have every expectation that that's going to continue as we look out from here certainly in 2024. So no change in our view of the underlying strength of the market growth, you know, month to month quarter to quarter, there may be fluctuations here and there just given how early we are in penetrating this market. But the trend line is unmistakable. This is a $6 billion market in the earliest phases of transitioning from conservative medical management to front-line therapy with FlowTriever and FlowTriever.
Lawrence Biegelsen
Thank you. And to help us understand the emerging technology and international lines better, can you talk about what's assumed for Artix and what's assumed for Japan and China. Any color on those those market opportunities and your confidence in Artix the second time around here that you're going to be successful? Thank you.
Drew Hykes
Yes. So relative to RDX, we've been working almost a back a year and a half now to reset that platform and do the development work. You've heard us describe coming out of the first gen LMR. We've been hard at work. We are cautiously optimistic that we've improved the product in terms of the effectiveness and ease of use that you've heard us describe before. But until we actually execute the LMR, we'll need to be a little cautious about and what kind of contribution we're going to be describing.
We've taken that into account in the guidance. It's a relatively modest component of our guidance as a result. Similarly, with China and Japan, we're confident we're going to be able to treat patients in those two markets this year, but there's some uncertainty around when the exact approvals will take place as well as how quickly the initial ramp will take place. And as a result of those uncertainties. We've also factored in a pretty modest contribution from both China and Japan into the 2024 guidance.
Operator
Marie Thibault, BTIG.
Marie Thibault
Am I fair in assuming most of that out of the US all of that out of the US? Or are there some emerging therapy treatments doing being done internationally?
Drew Hykes
Yes, Marie, there's that is primarily US revenue. When we're looking at the emerging therapies so for example, if you look at the table at the back of the press release, those are those are almost exclusively in the US and for the reasons you'd imagine we're in the process of pursuing regulatory approval for many of those products for international markets. I'll be initially focused on Europe and then we'll kind of roll those out into other parts of the world, but we're still kind of going through the process.
Marie Thibault
Okay. That's helpful. And then let me ask, I guess a two-part question, largely on cadence and sort of the path to think about this year of cadence for the sales as sales guidance throughout this year, if I'm recalling correctly, you know, Q2 was just a slight sequential step-up from Q1 so I'd like to trying to understand that for modeling purposes. And then similarly, the path to profitability and first half of 25 on operating profitability, what do you need to do kind of operating leverage wise? And what will it get to on to that to that goal?nEmory?
Drew Hykes
Thanks for the question. In the prepared remarks, I commented on kind of a Q4 target sorry, at a 4% target in terms of sequential growth from Q4 to Q1. As we move into 2025 past couple of years, we've seen some seasonality softness in Q2. We're still not sure about that if that's if that's a real thing in our business or not different reasons and theories around that. But then I did mention in the script that we would expect accelerating revenue sort of in the second half of the year.
So that would give you a sense for kind of the overall revenue profile from an operating leverage and kind of passive profitability point of view? Glad you asked about that year. And I was just thinking in Q4 in terms of our Q4 numbers, it was 23% revenue growth. Opex grew by 24%.But if we exclude the windfall onetime costs, OpEx grew by 15%.
Marie Thibault
So really nice progress there in Q4. And then looking at the full year numbers, revenue growth of 29%, OpEx growth of 22%. And then if we exclude the wind flow one-time stuff about 19%.
Drew Hykes
So we've taken this challenge of operating leverage seriously as a company. At some point, there's a lot of buy-in across the Company to looking at all the areas of the OpEx spend and making sure that we are seeing some nice productivity of our investments there. That's contributing to our confidence as we think about the progress of the business from a profitability point of view in the first half of 2024 versus the second half of 2024. So less basically operating losses as we move through the course of the year and then moving towards sustained operating profitability in the first half of 2025.
Operator
Will Plovanic, Canaccord.
Drew Hykes
Hi, Bill. Are you there.
Will Plovanic
Yes, Amir, thanks for taking my questions. I'll start off with. Can you help us understand just any commentary regarding competitive trialing share gain was? Where are you seeing the biggest impact DVTPE. I think as we look at these number on the VTE. business, you grew just under 20%. You've had some solid growth internationally, which puts the US more into the mid to high 10s. And I guess what I'm trying to get at is how much of this is behind you and what are you expecting in 24 in terms of this?
Drew Hykes
Yes. So happy to answer some of that, Bill and Mitch may want to pile on as well. We've been pretty clear about the competitive dynamics as we move through 2023. I think much of the competitive trialing was front end loaded on the year, but we did see it kind of splash over into Q3 and Q4. You've heard us describe those are cases that we would have had that's revenue that we would have generated.
And due to the competitive trialing, we don't have access to it. So it has definitely had an impact at the same time. Again, we began the year as the market leader. We're exiting the year as the market leader we are very confident in continuing to be the market leader. This is an attractive market. There are going to be new entrants that come where we compete head to head. We like our chances.
We like the way our technology is performing third, fourth generation platforms.At this point, we have a very capable and well established commercial presence and field team that are doing good work day in day out, and we've got a mountain of high-quality clinical evidence getting bigger every day. And I will continue to innovate on the technology as well.
On top of that, a very differentiated approach to market development. If you take all that together, we're very confident in our ability to continue to lead in this market and to the extent new entrants can help develop the market after all, that's where our focus is. That's where the real value is on a patient front as well as the value creation front. Anything you want to add to that, Mitch?
Mitch Hill
Yes, just the bill, from the point of view of the VT. growth, so I'm kind of looking at some of the revenue aggregation that's in that table. We disclosed in the back half of the press release. I'm just looking at the sequential revenue growth, let's say, of Q4 over Q3. So just over 4% there. Then when I look at the year-over-year number for VT. by 19.5%, revenue growth comparing 2023 to 2022. So I think those numbers are pretty attractive from a growth perspective, and we feel pleased with the progress and the performance of the business during during 2023 for all the reasons you heard from Drew very optimistic about 2024 as well.
Thomas Tu
And then just you mentioned, Mitch, on the profitability of the business, you subtracted out the WinDoor acquisition costs.
Mitch Hill
I'm sure there's some when you did that.
Thomas Tu
Is it just the acquisition or is that also the ongoing loan flow costs when we kind of looked at that from the court was that like a core business? Look, in terms of your answer to a prior question and the answer to the prior question, I was just looking at the 2023 Q4 numbers and also the full year numbers. And then just backing out the one-time costs which were identified in the press release, essentially that was $9 million in Q4. And then $11.7 million for the full year. I'm happy to share some commentary, if you'd like in terms of how that looks in 2024 as well.
No, I think we would expect the Yum, one-time costs if you're kind of interested in that from a Q4 perspective, I think one-time costs in Q1 will be about the same as Q4 and then potentially dropping to about half of that for the remainder of the year. And that's made up of both the transaction costs, which dissipate as we move through the year and then this purchase price amortization thing that we've talked about, the amortization of the acquired intangible assets.
And so happy to talk further about that. But hopefully that's helpful. Send at least some directional feeling on that. Yes, you're seeing another $9 million in Q. one and then we'll see about 2.5 to $3 million a quarter from the amortization in Q two through four. Is that a how to think about it?
Mitch Hill
Yes, that amortization number stays pretty consistent through the course of the year and $2.5 million the total one-time stuff in Q2 through Q4 is more in the 4 to 5 million range because there's still some transaction costs involved.
Will Plovanic
Great. Thank you. Thanks for taking my questions.
Drew Hykes
But Bill, just to make sure I'm clear, when I was talking earlier about the Company's profitability, we're speaking about GAAP profitability. So I'm not I'm not talking about this. The non-GAAP number that we have in the press release. I just want to make sure everybody is clear on that.
Will Plovanic
Thank you.
Operator
Chris Pasquale, Nephron Research.
Chris Pasquale
Thanks, Tom. Just one quick one on the quarter. Any color on the VT. mix between FlowTriever and clots, RayVa and 14?
Thomas Tu
You know, the overall mix, Chris, still has been pretty consistent. I think you've kind of seen historically, you can look back for several years actually for us. And you can see that the breakdown in terms of product wise revenue wise between the FlowTriever family and the Quattro family. So I would say that's pretty consistent. That's one thing that as a part of this new revenue aggregation, as we move forward?
You know, we're not going to talk specifically about that, but I think you've got a pretty good flavor for it based on how the business has operated historically.
Chris Pasquale
Okay. That's fair enough. And then just a couple of questions on Peerless completed enrollment, it's short follow-up. You talked about data being presented in the back half of this year. It seems like you might know what it looks like before then just given the timing here. So are you targeting a particular venue for that? And how would you frame the impact positively that could have what percentage of patients are getting CDT. today and could shift to mechanical thrombectomy if that data is really compelling.
Thomas Tu
Great questions, Chris, thanks for bringing them.Up. So firstly, as regards to the timing of the Peerless data release, we're really excited about the completion of enrollment in the study. I think it's a testament to the level of interest of clinical investigation in this space as well as the execution of that clinical team. We are targeting a major cardiovascular meeting for the release of the data and you can imagine towards the back half of the year, what possible meetings that might be?
I think this being a groundbreaking study deserves the kind of platform that that might provide. So that's as much as a timing. As far as on the potential impact, we know that CDT. has been progressively diminishing as a treatment for pulmonary embolism, although there are still people who consider that as a therapy. And I think this dataset is going to go a long way towards targeting conversion of CDT. on therapy to definitive mechanical.
Operator
David Rescott, Baird.
David Rescott
Great. Thanks for taking the question. The afternoon. I wanted to start on the emerging therapies bucket and some of the prior year over year prior data that you provided. When we look at, I think maybe Q2 through Q4 of 2023, it looks like there a pretty significant step-up at least closer that four to $5 million per quarter number versus the 2 million or so in Q and Q one.
So I'm wondering one if that is kind of the right way to start off thinking about emerging therapy contribution as early as, I guess, the first quarter of 2024. And I'm curious what the maybe the biggest kind of contribution segment or product in that 4 to 5 million per quarter that we've seen and whether or not that spend steady throughout those two to three quarters in the back half of 2023? Or if there's any movement around some of those new products having a bigger contribution on a quarterly basis?
Mitch Hill
Yes, David, I'm happy to get started on that Mitch may want to add some additional thoughts as well. So as you look back over the course of 2023 across the emerging therapies portfolio, keep in mind these are still relatively small numbers, but you're seeing the impact of some of the new product introductions that we made earlier in 2023, specifically rather core and then through so you're seeing the impact of those product launches and some of those step-ups looking ahead from here, we absolutely would expect the emerging therapies portfolio to grow on a relative basis quite a bit faster than VT.,
but obviously off a much smaller base and we will be bringing new product into the CBD toolkit alongside Revascor. We talked about that in the prepared remarks, there will be some incremental growth, hopefully from that new product introduction will have continued traction within thrill lead flow is included obviously in the CLTI. component of emerging therapies. We've only factored in a modest contribution from loan flow, but that will be ramping as we move through 2024 and the U.S. launch progresses. And then finally, we will get started on Artix if all goes to plan later in the year.
David Rescott
And that will be incremental growth in the fourth and final segment of emerging therapies that David, the thing I would add quickly is I think the growth in emerging therapies is likely to be a bit little bit lumpy. I guess I would call it, and that's both due to the fact that we have in some quarters a new product that's been introduced. And you can kind of see that looking at the numbers for 2023 actually back to 2022 as well. And then also due to kind of the way these products are moved through the back approval process and time line with the hospitals that takes, you know, X number of months typically for that to get through. And so where those actually begin to impact the revenue line, it tends to be a little bit lumpy as opposed to really smooth.
Drew Hykes
Okay. So would it be fair to say that maybe all of these segments on a go forward basis and thus far are contributing to the growth and there doesn't really appear to be a clear winner among the core products that are in your view, is there maybe clear winner products so far?
So I do think all four will contribute on a go-forward basis on on a relative basis. Artix is, of course, going to start from zero as we relaunch. So that will be a pure incremental across the other three, I think they will grow as we move through the year and to Mitch's point. And you might see some lumpiness driven by some of the new product introductions and the back approvals coming through across those respective new products. Yes.
Operator
Richard Newitter, Truist Securities.
Richard Newitter
Hi. Thanks for taking the questions. And thanks for providing the revenue disclosure. Maybe just on on kind of the pieces of the disclosure that you provided as they roll up to 24. I'm just trying to get a sense directionally, I'm could you tell me if I'm directionally close, I'm getting to the midpoint of your guidance. You're thinking about the core USVTE. in kind of the mid to high 10s, I'm assuming international about 5% to 6% of revenue. And um, and that implies the leftover being the emerging therapies, I guess, are those the directional component, understanding you strive to outperform the initial outlook or those interests are reasonable directional components of how to get to the midpoint of your guidance for now is specifically comment on that international as a percent of total in that 5% to 6% range.
Mitch Hill
And Richard, thanks for the question. I think we closed out the year with international at six, and that's something it's good. It's going to continue to make progress. I think there's potentially some step up as we move through the year and as we continue to get more traction, you know, in the more developed markets as well. We may have some additional products for sale at some point in these markets. I mentioned earlier during the call that we're still pursuing regulatory approval for many of the new product things that we've launched.
As Drew mentioned, we think that the international contribution from China and Japan is likely to be very modest and probably more back-end kind of loaded in terms of thinking about 2024. And from the point of view of the other pieces of the puzzle in terms of your revenue build. I think you're I think you're kind of headed in the right direction there in terms of how that's how that how certainly how we close out the year 2023, and then how we'll kind of think about 2024.
Richard Newitter
Okay. And just to be clear, so maybe international, even though you have incremental emerging therapies contribution international as a percentage of sales. So we'll gravitate higher than the 6% than 20, I guess?
Thomas Tu
Yes, that's what we expect. Okay. Thank you very much. And I think Bruce talked about that longer term growing into a 20% type factor, but certainly it's going to be a multiyear build to that level.
Richard Newitter
Thank you.
Mitch Hill
Sure.
Operator
Mike Matson, Needham & Company.
Mike Matson
Yes, thanks, Al. So just wanted to ask one on one flow. So you mentioned that and tap com opportunity. So on deal. I assume you've it's been applied for, but you don't know whether or not you're getting it yet. Is that right? How critical is that to driving adoption of the product to Nuvion.
Drew Hykes
Yes. Great question, Mike. I'm happy to get started on that. So so far, so good. With LIN flow. We closed in November. We made some really nice progress on the integration front, and we've also made some nice progress on the initial U.S. launch. We obviously don't have access to the untapped today, but if you look at the existing reimbursement inpatient reimbursement today at our target first group of limb salvage centers, it is in the neighborhood of $30,000. So it is a positive contribution margin procedure even today with the existing reimbursement we have applied for and TAP and are confident we will receive it.
It will go into effect in October, and that will add incrementally about another $16,000 and incremental reimbursement on top of the existing DRG. So it obviously provides a lot of incremental economic value to the hospital at that point. But even today in advance of the intent and we are gaining back approvals and beginning to do initial cases in the US. And I think the economic value proposition is broader and ties back into lymphoma being a really important part of any limb salvage center armamentarium and some of the broader economic considerations I think are helping fuel the growth here and the traction even in advance of the untapped, which again, we anticipate coming online in October.
Mike Matson
Okay. Thanks. And then I know there's a lot of focus on competition from a number, but I just wanted to ask if you've seen any sort of impact from a cost-sensitive XARELTO study, I think that was presented at TCT kind of in the fall. Did that drive any kind of it pickup in their Ecos sales or I mean that you could see your share gains from you guys?
Mitch Hill
Yes, I think Tom might have some perspective to share on that dataset and the impact? Yes. Thanks for the question, Mike. So on first of all, to call, the real PE. dataset, a trial, I think, is maybe overstating its value. It really was a kind of an exercise in electronic medical record assessment. And what it showed is that when you retrospectively look at who got FlowTriever, you oftentimes saw patients who were too sick to get any other therapies.
You got patients who are actively bleeding who got the only therapy that really was appropriate for somebody who cannot get lytics, and that would be mechanical thrombectomy and so I think it was a nice exercise in selection bias. I think the vast majority of physicians see it for what it is. We're excited about Peerless because Peerless is actually high quality quality, randomized data. And I think that the community can't wait to see the results of that. We really have not seen any commercial impact from that data release Okay. Got it.
Mike Matson
Thank you.
Drew Hykes
Thank you, Mike.
Operator
This concludes our conference call and thank you for attending today's presentation. You may now disconnect and move in. We know that no, no not in the end and.
