Opsens Inc

TSX:OPS

Earnings Call Transcript 2022-Q3

[Operator]

Good morning, and welcome to the OpSens Incorporated Third Quarter Fiscal 2022 Financial Results Conference Call. All participants will be in a listen-only mode. [Operator Instructions] After today’s presentation, there will be an opportunity to ask questions. [Operator Instructions] Please note, this event is being recorded.

I would now like to turn the conference over to Joe Dorame with Lytham Partners. Please go ahead.

[Joe Dorame, Lytham Partners]

Good morning, and thank you for joining us today for the OpSens third quarter fiscal year 2022 conference call for the period ending May 31, 2022.

With us on the call representing the Company today are Louis Laflamme, President and Chief Executive Officer; and Robin Villeneuve, Chief Financial Officer. At the conclusion of today’s prepared remarks, we will open the call for questions.

Before we begin with prepared remarks just a couple of comments. Today’s call will contain forward-looking statements that are based on current assumptions and subject to risks and uncertainties that could cause actual results to differ materially from those projected and the Company undertakes no obligation to update these statements, except as required by law.

Information about these risks and uncertainties are included in the Company’s filings, as well as periodic filings with regulators in Canada and the United States, which you can find on SEDAR and OpSens’ website.

Today’s discussion will include adjusted financial measures, which are non-IFRS measures. These should be considered as a supplement to and not as a substitute for IFRS financial measures.

Finally, today’s event is being recorded and will be available for replay through a webcast on the Company’s website.

With that said, let me turn the call over to Louis Laflamme, President and Chief Executive Officer of OpSens. Louie, please proceed.

[Louis Laflamme, President and Chief Executive Officer]

Thank you, Joe, and good morning to all of you. We are excited to speak with you today again to discuss the developments within the business. Let me also take a minute to greet the French speaking audience. [Foreign Language]

I am pleased to report that we continued to build positive momentum during the third quarter of fiscal 2022 as we achieved numerous important milestones and set a number of new quarterly revenue records. First, we achieved quarterly revenue of $10.1 million, a new record for the company. This was a 25% sequential increase from the second quarter and above the expectations we communicated to you last call.

Second, our coronary artery disease business had a record revenue quarter. The subsidence of the Omicron variant in North America and commensurate uptick in procedure volumes, coupled with an elimination of certain supply chain disruptions we had previously experienced, were key factors to the record quarterly results, but also important are the investments we have made in sales and marketing. These positive trends have been consistent with what I mentioned in the last two quarters as we are seeing a strong second half of fiscal year 2022. I will expand more upon what we are seeing as we now sit about halfway through the fourth quarter in a moment.

Third, we achieved a record performance in our Partnerships segment, where we had record shipments. Another key milestone during the third quarter was the Health Canada approval for the SavvyWire. This approval was received ahead of expectation and allow us to officially enter the rapidly growing global TAVR market. The global TAVR market is currently estimated at over 200,000 procedure and is expected to reach 400,000 in 2027.

Following the Health Canada approval, yet another key milestone in the form of the first successful commercial cases. I will expand upon our limited control, limited market release to hospital in Canada, but needless to say that we are highly optimistic about our entry into this rapidly growing market.

In the U.S., we remain on track for an anticipated clearance of SavvyWire in the second half of calendar 2022 with full commercial launch in early 2023. So as you can hear, at high level, the third quarter was a tremendous quarter for OpSens, and I would like to thank our team members for their dedication and hard work. Record revenues and regulatory approvals lead the way, however, more importantly is the bright future we have ahead of us.

Let me dive into more specifics for everyone, including our outlook and then we will be happy to take your questions. Starting with the OptoWire, sales within our coronary artery disease business or what we refer to as FFR and dPR were $6.6 million during the third quarter, a new record for this segment. This compared to $6.2 million in the year-ago quarter and $4.6 million in the sequential second quarter. The impacts that we have been experiencing in the last few quarters have been largely overcome as a number of hospital procedures are returning to more normalized levels and the supply chain disruption we had anchored have been largely resolved.

As we look at sales around the world, the U.S. was up 27% sequentially, but still not quite at the levels achieved in the third quarter of last year, which benefit from unusual short-term volume recovery since COVID reopening. One other key item in the U.S. we are seeing is the growth in our GPO-related business with the addition of eight new accounts opened in the third quarter. We continue to believe the GPOs will be a key driver for us going forward in enhancing the adoption and utilization of the OptoWire in the U.S. We believe this also sets the foundation for a successful commercial launch of the SavvyWire upon FDA clearance and we look forward to developing additional agreements in the future.

In Canada, similar to the U.S., we saw sequential growth in coronary artery disease sales, but a slight decrease from the year-ago quarter for the reasons I mentioned. We continue to benefit from a multi-year contract we received where we were selected as the main coronary pressure guidewire for the eastern part of the province of Quebec. The trend in EMEA were similar to U.S. and Canada as well. While we work on the distribution model in this region as opposed to a direct selling model, our team has done a tremendous job of improving the performance of distributor through enhanced educational activities. I believe the work that has been accomplished in the last couple of quarters will continue to bode well for continued improvement in EMEA.

The biggest growth we saw this quarter was in Japan. Sales to Japan were up 168% sequentially and up [36%] compared to the year-ago third quarter. I mentioned last quarter that we were experiencing supply chain disruptions that prohibited our ability to obtain certain components for Japan. We have since resolved those issues and we are able to ship significant quantities to them in the third quarter including some 350,000 in back shipments that were initially intended to go out in the second quarter.

So with COVID hopefully behind us and the supply chain disruptions largely under control, I believe we are well positioned to end the year on a high note. One comment I do want to make is that given we shipped about 350,000 in orders to Japan during the third quarter that were in essence catch up shipments from Q2. We could see a slight reduction sequentially in our FFR business, but it will almost entirely be due to those to these catch-up shipments to Japan as we are expecting growth in the U.S. and Canada in Q4 for OptoWire.

Transitioning to our business partnerships for a moment where several companies are integrating OpSens sensors into their products used in medical application. As I mentioned, we had a record revenue quarter from this area in the third quarter. Overall, sales to OEMs were $2.6 million in Q3 2022 compared to $2.3 million in Q3 2021 and $2.4 million, sequentially, again, a significant percentage of those sales going to Abiomed. We are pleased to continue this long-term mutually beneficial relationship and look forward to many more successful years.

Let us now transition to our Industrial segment, which leverage our fiber optic sensing technology and knowledge by offering key solutions in optical temperature, pressure, strain and other critical parameters for various industries, including aerospace, nuclear and power electronics.

For the quarter, revenue was $873,000 compared to $713,000 in the year-ago quarter. This has been relatively consistent throughout the year. Looking forward, the long-term opportunity in this segment continues to remain attractive as we are working on an increasing number of potentially significant projects where OpSens fiber optic sensing components [could be integrated] into these critical projects, including the International Thermonuclear Experimental Reactor and the fuel monitoring for aerospace with leading aviation manufacturers seeking solution to reduce weight and improve operational efficiencies and many others.

With that overview on our commercial-based operation, let's jump into our TAVR program. Always use to call this a development program, but following the Health Canada approval, I think we can officially call it a semi-commercial program with one more important development step needed for full commercialization, which is FDA clearance.

To those newer to the company, the SavvyWire is our new intelligent pre-shaped structural guidewire with integrated pressure monitoring and pacing capabilities aim at improving procedural efficiency and clinical outcomes by allowing multiple steps over the same device without exchange and without compromise on performance. The device has been designed to support the minimalist TAVR approach, which has been growing among structural heart physicians. With the SavvyWire, physicians can expect to diagnose and implant the valve over the same device while getting continuous and accurate hemodynamic measurements.

As we announced back in April of this year, we received Health Canada approval for the SavvyWire. The approval was received at end of expectations and marked an important milestone on the path to the full commercialization of the SavvyWire. With Health Canada approval in hand, we have initiated a limited market release in Canada with a full launch expected towards the back half of 2022.

Due to that phase launch was the successful first use of SavvyWire in a commercial setting. To this end, we worked with Dr. Rodés-Cabau at Quebec Heart and Lung Institute and Dr. Reda Ibrahim at the Montreal Heart Institute to perform the first commercial cases with SavvyWire. In Canada, we are in the limited market release phase. For those not familiar, what this means is that we are focused on doing 60 initial cases before we move to full market release.

At this point, we are approximately two-third complete and conducted procedures in Montreal, Quebec and more recently in Vancouver. The goal in the limited market release is to ensure that the entire process is smooth and that any procedure hiccups are worked out ahead of time. Part of that process is to perform different types of cases. We have done standard cases with femoral access, but also more complicated cases with terative and right axillary access.

Finally, during all those cases, we have encountered all sorts of anatomy tortuosity and calcification, representing the vast spectrum that can be seen in the all-comers patient. With more than half the limited market release completed, we have not encountered any technical or safety issues and doctors' experience were quite exceptional. We expect to have the 60 initial cases completed sometime in the next month or so, at which time we will move to full market release in Canada. Similar to comments I have made throughout this year, the press and interest from the medical community around the SavvyWire capabilities have been tremendous.

To expand upon the positive data that was presented at TCT in November, we recently saw the medical publication of clinical data supporting the correlation between OpSens sensing technology and the current standard-of-care before and after TAVR in the JSCAI Journal. This campaign and editorial and online panel discussion ahead of the JSCAI session meeting held in Atlanta in late May.

Further, the results of our 20 patients SavvyWire first-in-man clinical study were presented in May 2022 at EuroPCR and published at the same time in EuroIntervention Journal. I am honored by the medical community's acknowledgement of the beneficial capabilities of using our SavvyWire for TAVR and expect that this will even increase with our clinical strategy plan to increase awareness on the potential benefit of using the SavvyWire in TAVR cases.

In regards to the FDA clearance, since the last call, we had a Q-Sub meeting with the FDA to discuss our proposed answers on last questions remaining. The Q-Sub meeting allows them to provide real-time feedback to the proposed answers. We are positive about our interactions with the FDA and expect to have final responses ready in the coming weeks. Upon our final submission of these responses, the FDA usually takes 60 days to respond, which would put a potential approval in the second half of calendar 2022 in line with our original expectations. While we await the FDA's clearance, we are advancing our commercial operations to ensure a successful commercial launch later this year.

In particular, we are conducting internal training of our sales team on the TAVR procedure and SavvyWire. We have also presented clinical data at various medical conferences since we last spoke, including one in Chicago, one in Frankfurt and one in Vancouver to create awareness of our SavvyWire. Similar to Canada, we will conduct an initial limited market release in the U.S. However, as opposed to just two or three centers in Canada, it will likely be a bit broader in the U.S. Our goal is to have 100 cases completed in the U.S. before we move to full market release.

Finally, we are ramping up our manufacturing capabilities. Our goal remains to be in full commercialization in calendar 2023. We look forward to sharing more with you in the coming months.

Before I turn it over to Robin for a more detailed review of the financials, let me quickly summarize. This was a great quarter for OpSens on multiple fronts. From the commercial standpoint, we had record quarterly sales, led by record coronary artery disease sales and record sales in our Partnership segment. On the development front, we received the first regulatory clearance for SavvyWire from Health Canada and remain on track for FDA clearance later this year.

We have ramped up our sales and marketing teams to take advantage of the opportunity we have in front of us for both OptoWire and SavvyWire. We are making the necessary preparations to hit the ground running upon FDA clearance. The market and pandemic-related headwinds we have encountered previously, including a reduction in procedure volume and supply chain-related issues appear to be largely behind us and our industrial team is gearing up for some exciting new projects in the coming years.

And finally, what I think is always something important to point out, our balance sheet remains strong, allowing us to execute on our strategy to drive value creation going forward. As always, I want to thank all our employees for their hard work and dedication. We have accomplished important milestones and development with many more opportunities ahead.

Let me now turn the call over to Robin for a further review of the financial results. Robin?

[Robin Villeneuve, Chief Financial Officer]

Thank you, Louis, and thanks to everyone joining us on the call. As Louis hit on the few of these items, I will try to add additional details where I can. The company reported sales of $10.1 million during the third quarter. This was broken down as $6.6 million in our coronary artery disease line of business or FFR and dPR, $2.6 million in our optical medical systems, which is mainly our agreement with Abiomed for integration of our pressure sensor into their Impella pump, and about $900,000 in our Industrial segment.

When you look at gross margins, they were sequentially stable at 51% in Q3 2022 and down from 58.8% punctual spike in Q3 2021. Few factors that impacted gross margins was a bit of an uptick in cost of goods sold for OptoWire, particularly as we enter the end-of-life production for the OptoWire 2 and the ongoing supply chain issues affecting manufacturing cost.

There was also, as part of our plan, a shift due to the increased weighting of distributor sales over direct sales. Given that a few of these factors will persist through at least the next few quarters, we think that margins will remain in the low 50% range for the next few quarters.

From an operating expenses standpoint, as planned, overall operating expenses increased by $1.4 million during the third quarter of fiscal 2022 compared to the second quarter of fiscal 2022. The increase is largely explained by our investments in sales and marketing teams as we are ramping up our sales efforts to continue growing market share in the U.S.

Along with increases in our R&D cost, please note that our G&A expenses have remained flat this quarter. As we explained, we are making additional investments in sales and marketing and research and development over the coming quarters to capitalize on the opportunities to accelerate growth of our OptoWire and to prepare the commercialization of our SavvyWire.

EBITDA, which we defined as net income less plus income taxes, financial expenses, depreciation and right-of-use-assets, amortization of intangible assets and stock-based compensation costs was a negative $2.1 million in the third quarter of 2022 compared to a positive $0.2 million in the third quarter of 2021. The decrease is mainly due to higher operating expenses of $2.2 million as previously explained.

Looking at net income, we are reporting a net loss of $2.9 million in the third quarter of 2022 compared with a net loss of $0.6 million in the year-ago third quarter and compared to a $2.4 million loss in Q2 2022. The net loss is due to our investments to capitalize on business opportunities with additional spending in sales and marketing, R&D and others for operating expenses increasing, as I mentioned earlier.

Finally, on the balance sheet, we ended May 31, 2022, with $28 million in cash and cash equivalents.

With that, I will turn the call over to Louis.

[Louis Laflamme, President and Chief Executive Officer]

Thank you, Robin. Thank you to all our investors for their continued interest and support of OpSens. We are working hard every day to capitalize on the opportunities ahead of us to position OpSens for long-term success.

Operator, let me now turn the call over to any questions.

[Operator]

We will now begin the question-and-answer session. [Operator Instructions] Our first question is from Rahul Sarugaser with Raymond James. Please go ahead.

[Rahul Sarugaser, Raymond James Ltd.]

Good morning, Louis and Robin. Thanks so much for taking the questions.

[Louis Laflamme, President and Chief Executive Officer]

Good morning, Rahul.

[Rahul Sarugaser, Raymond James Ltd.]

Good morning and congratulations on the quarter. Very well done. So a quick point of clarification on the revenue. You mentioned that there was a bit of a catch-up in Japan from orders from 2Q, and you had guided to potentially some attenuation of revenue expectations into Q3. So could you give us a little more detail around that, particularly given that a third of the revenue is really coming from the Abiomed deal and how much of that attenuation we should expect?

[Louis Laflamme, President and Chief Executive Officer]

Okay. Well, thanks for your question. Regarding Japan, as we mentioned in the second quarter is that there was some disruption on the supply chain. This negatively affected our capability to deliver some device in time for the closing of the second quarter. So consequently, we had $350,000 of revenues that should have been recorded in Q2. But since we cannot deliver in time, it was recorded in Q3. So this obviously will – when you start Q4, we won't have those $350,000.

In addition to this, as you know, usually, the fourth quarter, and cath lab is probably the one that is having the lowest volume because of vacation and others, so we are taking a conservative view on Q4 for coronary disease where we still expect to record growth year-over-year, so compared to Q4 2021, but we maybe short sequentially compared to Q3 2022.

So my comment there is only applying to the coronary artery disease business. For the OEM business, the business partnership segment, the demand is really strong, and we see – we have good confidence that we will continue to show growth in that area.

[Rahul Sarugaser, Raymond James Ltd.]

Terrific. That's very helpful. Thank you, Louis. So my next question is you're indicating that your expectation of the potential FDA clearance is, as I believe the term using is second half of this year, we had calculated that based on submission dates that late Q3 would be approximately the time. So I just wanted to sort of get a little bit of clarity there. Are you just sort of being conservative by providing that time line? Or should we be thinking about beyond late Q3?

[Louis Laflamme, President and Chief Executive Officer]

No. I think we should – I mean if I try to be more specific in terms of month, what we disclosed in the past was end of September or October, and we are still keeping those months as a target. So the progress has been really interesting on that side. The discussion with the FDA have been really instructive to us to make sure that we will meet their request. So we really feel that we are under control with this and we are in execution mode to deliver the final answer.

[Rahul Sarugaser, Raymond James Ltd.]

Okay. Great. That's very helpful. Thanks, Louis. And if you just indulge one last quick question. We fully recognize that you are, as you say, I believe use the term, semi-commercial now ramping the sales team. We saw that reflected in the sales and marketing numbers with a $1.1 million bump in this quarter. Can you give us a little more clarity in terms of how you're balancing the ramp of the sales and marketing team with your anticipated time lines for, hopefully, the FDA approval, then, of course, the commercial launch, particularly within the context of the current macro environment where the market is valuing a premium on companies that maintain cash? And I believe you guys have more than two years of cash runway based on the current burn and that, of course, would be beneficial to maintain. So could you give us sort of that balance between cash and ramping your sales team?

[Louis Laflamme, President and Chief Executive Officer]

Yes. I mean, we – as you mentioned, we really like our cash position right now with $28 million in the bank account without any significant debt. This being said, we see – we think it's creating value for shareholders to make sure that we do the proper spending and being ready to execute to commercialize the SavvyWire, in particular, in the U.S., where it's the biggest market opportunity.

So we may have not gone as fast as what we mentioned in the past, but we still have the intention to select, to recruit the best territory managers that we can find and to have a broader team once this product is approved. So I understand you would like to get indication or numbers. Overall, I would say to you that the team is growing, probably not as fast as we plan initially, but it's mostly because we want to be sure that we recruit the best talent in the field.

[Rahul Sarugaser, Raymond James Ltd.]

Great. That's very helpful, Louis. So thanks again for taking our questions and also congratulations again on the quarter.

[Louis Laflamme, President and Chief Executive Officer]

Thanks a lot, Rahul.

[Operator]

The next question is from Doug Miehm with RBC Capital Markets. Please go ahead.

[Douglas Miehm, RBC Capital Markets]

Louis, I just wanted to delve into the FDA questions and what you have to get back to them on. I'm just curious as to whether this is focused on safety or biocompatibility, but perhaps you could expand on what you're preparing over the next few weeks to answer in your remaining questions for the FDA?

[Louis Laflamme, President and Chief Executive Officer]

Okay. Thank you, Doug, for your question. I would say, right now, there is two areas where there is some ongoing additional testing that is taking place. One area is around the biocompatibility, but we – our confidence level is really high because we've done various other testing before the current testing. So we should be done there fairly soon.

The other area where there is some question is around the capability of our device to deliver electricity in a way where it could [harm] patient. And again, there, we have 150,000 cases with the OptoWire where it did not happen. We – using the fiber uptick by definition is not conducting electricity. So there is some testing that needs to be done there to meet the requirements from the FDA, but it's not an area where we see a high level of risk. That's why, I mean, as soon as we can complete those tests, we should be in a great position to file since other responses are almost ready.

[Douglas Miehm, RBC Capital Markets]

Okay. Perfect. And then my other question just has to do with publication of data and also presentation of data that relates to SavvyWire. I think you mentioned a few things already. But as we look from early July to the end of the year and into early next year, could you tell us at which conferences or how many, where we could expect to see data to help with the launch?

[Louis Laflamme, President and Chief Executive Officer]

Well, first, maybe I will take a step back here where everybody understands that when we came with the OptoWire, the clinical data were already built around the interest in using a pressure guidewire. So yes, we showed the benefit in having a more accurate wire capability to do a procedure only with one device.

In the case of the SavvyWire, here, we are in a different position because it's a new concept. It doesn't exist in the field. And since that situation, I mean, we got multiple ideas from doctors, multiple opportunities where we could really take the podium and present the SavvyWire. And this will raise a high level of attention in the TAVR field.

So that's the basic where OpSens is planning to spend in the next few years, a couple of millions. I mean we are not talking about a pharmaceutical development, a drug development where you are talking about tens of millions of dollars in clinical study, but we do plan to invest a couple of millions, like I said in the previous calls.

To say exactly what we will do, I would prefer to wait a little bit. This being said, one thing is sure is that at TCT in Boston, at the end of the summer, you will have a presentation about the SavvyWire there with top key opinion leaders in the field.

[Douglas Miehm, RBC Capital Markets]

Excellent. Okay. Thank you.

[Louis Laflamme, President and Chief Executive Officer]

Thank you, Doug.

[Operator]

The next question is from Justin Keywood with Stifel. Please go ahead.

[Unidentified Analyst]

Hi. This is Julian speaking for Justin today. My first question is, given the rebound in heart procedures, it doesn't seem like the business is generating a profit at the moment. So would it be possible for you to outline what the path to profitability looks like, specifically how much revenue were SavvyWire must be sold off to get there?

[Louis Laflamme, President and Chief Executive Officer]

Okay. So at a high level, what we can say is that since what I just answered in the previous question from Doug at RBC, we are planning to invest once the SavvyWire is approved in U.S., in Europe, in Canada and even at some point, also in Japan. So these investments in sales and marketing and clinical activities will happen in 2023 and 2024, the fiscal year of OpSens. So in those years, we still expect to operate with a certain burn rate.

We have the financial position to support that. For fiscal year 2025, the vision on a consolidated basis is to achieve $100 million in sales. What would be the split between the OptoWire and the SavvyWire and the OEM business and the industrial business, we probably don't need to grow at that level at current time. But what I can say is that we think once we will be at $100 million in sales gross margin, percentage will increase. And at that time, we'll be in a great position from a cash flow standpoint.

[Unidentified Analyst]

Okay. Thanks for that. I just had another question about R&D. Now that the business is in the semi-commercial phase, can you provide us an update on what other R&D projects or add-on products you're currently pursuing?

[Louis Laflamme, President and Chief Executive Officer]

What I can say is that OpSens has really unique core competencies in terms of sensing, in terms of developing small devices, in terms of meeting unmet needs in cardiology and industrial market and also, the capability to display information in real-time in cath lab. So when we think about our R&D future and the way to create value for shareholders, we think we can use those core competencies and specific application. So we have not disclosed yet what will be the next product for OpSens. But what I can say is that there is various opportunities in structural heart and also, we are spending a certain amount of resources around software development because for those that saw the display that we have with the SavvyWire for TAVR, I mean it's really bringing the TAVR procedure in the new era. And we think we can even grow further, both in coronary artery disease and structural heart with some additional algorithm.

[Unidentified Analyst]

Okay. Thank you very much for taking my question today.

[Louis Laflamme, President and Chief Executive Officer]

Thank you, Julian.

[Operator]

The next question is from Scott McAuley with Paradigm Capital. Please go ahead.

[Scott McAuley, Paradigm Capital]

Good morning, gentlemen. Congrats on the quarter and thanks for taking the questions. A lot of them have already kind of been addressed, but one thing I wanted to ask on is with kind of the increase in procedure volumes coming out of Omicron in the first few months, it was great to see the kind of bounce in the OptoWire revenues. Do you see most of that coming from kind of that resumption of procedures that had been delayed or canceled for the past few months versus signing on new customers that are actually switching to the OptoWire?

And then similarly, kind of looking forward in the near-term, is there still opportunity for growth from the just general increase in procedure volumes coming out of COVID? Or is really all the growth in OptoWire are going to be kind of new customers getting new cardiologists to be using the product?

[Louis Laflamme, President and Chief Executive Officer]

Okay. Thanks for your question, Scott. So the way we see this, let's say, when we look at Q3 – well, there is the situation in Japan where there was some catch-up that help us to generate growth. On top of that, I mean, there was – Japan is an area where COVID hit hard in Q3. We were coming closer to a more normal situation from a volume of procedures. When we think about Europe and North America, I would say that the growth that we recorded, yes, the recovery in the volume did help, but we see mostly our growth coming from new accounts that we develop from enhanced performance in the existing accounts, and we think this will also be reflected in Q4.

[Scott McAuley, Paradigm Capital]

Okay. And then, I guess, just pairing that with kind of your previous comment in the coronary artery business kind of expectations of kind of growth year-over-year, but could be lower kind of quarter-over-quarter? Again, with – if you're seeing new customers and existing customers using it more, just kind of in line between those two points?

[Louis Laflamme, President and Chief Executive Officer]

Exactly. And I would also say, let's say, if we take a little bit longer term in terms of view, part of the strategy of OpSens to do better in North America and in particular, in U.S. is, okay, yes, capitalize on the GPO network that we built, also capitalize on the fact that we will have a second product to sell. And we think this will be really strategic for us because it will make us more relevant for doctors, more relevant for hospitals, more relevant for GPOs.

And the third component in doing better is to have a broader team, and having a second product will lower the bar in terms of bringing territory managers to profitability. So with that, we should be able to have a broader thing. So the strategy in North America, there is a part that we can execute without the SavvyWire. But clearly, once we get SavvyWire clearance, we should see an acceleration in growth, not only on the structural heart side, but also on the coronary artery disease side.

[Scott McAuley, Paradigm Capital]

That's great. And I think that, again, a lot of the previous questions were covered. So again, congrats on the quarter and thanks for taking the questions. Cheers.

[Louis Laflamme, President and Chief Executive Officer]

Thank you, Scott.

[Operator]

[Operator Instructions] The next question is from Nicholas Cortellucci with MPartners. Please go ahead.

[Nicholas Cortellucci, MPartners]

Good morning, Louis and Robin. How's it going guys?

[Louis Laflamme, President and Chief Executive Officer]

It's going well. Really well. You, Nick?

[Nicholas Cortellucci, MPartners]

Great. Just have a couple of questions here. Congrats on the growth this quarter. So I was wondering about the Health Canada launch. So after you guys can complete these 60 cases, what does the launch kind of look like? Have you received initial conversations and inclinations from guys so you can see how fast sales is going to ramp?

[Louis Laflamme, President and Chief Executive Officer]

I mean we – right now, we are really focusing on making sure that the execution is perfect in the current account that we have. We don't want to pre-sell too much, and it's in line with our quality program. This being said, I think it can be fairly quick, but it will happen for us more in the first and the second quarter of the fiscal year 2023 in Canada for OpSens.

[Nicholas Cortellucci, MPartners]

Right. Okay.

[Louis Laflamme, President and Chief Executive Officer]

The good thing in Canada is that, I mean, it's a completely different market than U.S. in terms of the number of procedures, but also in terms of the number of hospitals. So the number of hospitals that are doing TAVR cases is fairly small. But within those hospitals, the volume is high. So we think Canada will have a good contribution in our revenue for the fiscal year 2023 for the SavvyWire.

[Nicholas Cortellucci, MPartners]

Right. Okay. Thank you for that. And then my other question was with a lot of the tension you guys have been getting on the SavvyWire, do you think any of the competitors have taken notice and have started to build out something with continuous pressure measurement? Or is their tech just too many years behind you guys?

[Louis Laflamme, President and Chief Executive Officer]

Well, first, we think that we are having a very unique technology, patented technologies on the display, on algorithm, on pressure wire design, on connection. So we really like our place from an IP standpoint. And also, I remind everybody that the connection characteristic that we are using in coronary artery disease, the capability to disconnect and reconnect the device. Again, it's really useful for FFR.

In the case of TAVR, you will disconnect in 100% of the time. So we think to develop a pressure guidewire for TAVR, you need to have fiber optic. So since that, the number of suitors to develop such application is incredibly limited because there is two miniature pressure sensor that exists using fiber optics to be for medical applications. And we have not heard anybody working on that right now. So we really like our position. At some point, competition may come because it's such an interesting concept, but we don't see this before multiple years.

[Nicholas Cortellucci, MPartners]

Okay. Good. That's great to hear. Those are all my questions. Thanks guys.

[Louis Laflamme, President and Chief Executive Officer]

Thank you.

[Operator]

The next question is from Jeff Schacter with TD. Please go ahead.

[Jeffrey Schacter, TD Wealth Private Investment Advice]

Hey, Louis.

[Louis Laflamme, President and Chief Executive Officer]

Good morning, Jeff.

[Jeffrey Schacter, TD Wealth Private Investment Advice]

Yes. Good morning. Congrats on the quarter. I'm just curious a couple of things. One, it's couple callers ago asked a similar question, but just market share gain on the OptoWire, like without Savvy and sort of do we see still headwinds since trying to gain market share in segments? I mean, as procedures are coming back, are you seeing any kind of pickup in your volumes relative to the competition? Or when you launch the Savvy with the monitor being shared, do we expect to see gains on sort of both fronts and breaking down some of those barriers that you had?

[Louis Laflamme, President and Chief Executive Officer]

Okay. What I can say, Jeff, if we take as an example, in the U.S. market, for Q3, the volume of procedure in general was slightly down because of COVID and so on, while our market share was up. So that's what we are seeing with our internal data.

The second component of your question is something that I did not insist today in the call, but it's still something really important is that we want to be supportive to the hospital. So one thing we have done is that we make sure that for the OptoMonitor 3, you can use it with both, the OptoWire and the SavvyWire. And we think this will be quite useful for us to drive business on both products, and we think it will be well appreciated by hospitals because once they will have done the investment in time to install the monitor, they will be in a position to capitalize on the benefits of both products to support them in their practice.

[Jeffrey Schacter, TD Wealth Private Investment Advice]

Okay. And I'm assuming cardiologists, do they have the exposure in the U.S. to your product? Or will they be – will – or is it just something that they will be made aware of and then simply start to put pressure on the hospital to say, this is a better tool than what we're using for our procedures and as such, we should make it more of a top choice in the cath lab? Is that sort of the...

[Louis Laflamme, President and Chief Executive Officer]

Yes. Well, we need to be – with the rule that exists in U.S., we need to be really careful in not doing something that would be commercial on a product that is not approved. The cardiologist that participated to TCT, TVT and few other conferences could have been exposed to SavvyWire during clinical data presentation.

[Jeffrey Schacter, TD Wealth Private Investment Advice]

Okay. The final part is just – I know you're not giving a lot of credit for the industrial side, but you did make a couple of brief comments that seemed forward-looking and optimistic. I'm just wondering like when is it realistic to see even further traction on the industrial side, which seems like it has some exciting opportunities?

[Louis Laflamme, President and Chief Executive Officer]

Yes. I mean, we are incredibly excited about the industrial business. And fiber optic sensors, they have some advantages and some specific applications. And we – as an example, and I mentioned that previously is that we think there is interest in using fiber optic sensing in fuel monitoring project.

A few years ago, we announced a partnership with the company called Temai, this is progressing well. The regulatory obstacles or the steps to bring a commercial product in aeronautic is long, but we are making tangible progress. So the vision that we have right now is that the OpSens Solutions business unit. So a wholly owned subsidiary is a cash flow positive business. In addition to that, it can create to substantial value for shareholders since we are developing a product and disruptive application.

[Jeffrey Schacter, TD Wealth Private Investment Advice]

Okay. Thank you.

[Operator]

This concludes our question-and-answer session. I would like to turn the conference back over to Louis Laflamme for any closing remarks.

[Louis Laflamme, President and Chief Executive Officer]

Well, many thanks to everyone for participating on today's call. We look forward to hopefully speaking with all of you shortly. Thank you, and have a good day.

[Operator]

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.