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Acutus Medical, Inc. (AFIB) Q4 2020 Earnings Call Transcript

By Motley Fool Transcribing - Mar 18, 2021 at 11:30PM

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AFIB earnings call for the period ending December 31, 2020.

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Acutus Medical, Inc. (AFIB -6.96%)
Q4 2020 Earnings Call
Mar 18, 2021, 4:30 p.m. ET

Contents:

  • Prepared Remarks
  • Questions and Answers
  • Call Participants

Prepared Remarks:


Operator

Ladies and gentlemen, thank you for standing by, and welcome to the Acutus Medical fourth-quarter 2020 earnings conference call. [Operator instructions] Please be advised that today's conference is being recorded. [Operator instructions] I would now like to hand the conference over to your speaker today, Caroline Corner, investor relations. Thank you.

Please go ahead, ma'am.

Caroline Corner -- Investor Relations

Thank you, operator. Welcome to Acutus's fourth-quarter and full-year 2020 earnings call. Joining me on today's call are Vince Burgess, president and chief executive officer; and David Roman, chief financial officer. This call will include forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.

All statements made on this call that do not relate to matters of historical facts should be considered forward-looking statements. Factors that may cause results to differ from these forward-looking statements are discussed under the forward-looking statements section in the press release attached as an exhibit to Acutus's Form 8-K filed with the SEC today and are also discussed in more detail under the Risk Factors sections in Acutus's most recent filings with the SEC, including the risk factors described in Acutus's Form F-1. Any forward-looking statements provided during this call, including projections for future performance, are based on management's expectations as of today. Acutus undertakes no obligation to update these statements, except as required by applicable law.

Acutus's press release for the fourth quarter and full-year 2020 results is also available on the Acutus's website, www.acutusmedical.com, under the Investors section and includes additional details about Acutus's financial results. Acutus's website also has Acutus's SEC filings, which you are encouraged to review. A recording of today's call will be available on the Acutus's website later today. Now, I would like to turn the call over to Vince for his comments and fourth-quarter and full-year 2020 business highlights.

Vince Burgess -- President and Chief Executive Officer

Thank you, everyone, for joining us today. I apologize for the last-minute change to the earnings call timing. The time change is entirely the result of an error by the company's filing agent, Donnelley Financial Services, whereby Donnelley inadvertently filed the Acutus financial results for automated distribution earlier today at 3:00 a.m. Pacific Time, 6:00 a.m.

Eastern Time. As soon as we learned of this error, we acted swiftly to ensure we could move our call to discuss results before market open. We appreciate your understanding of this matter. As Carolyn mentioned, I'm on the call today with David Roman, who, as we announced last month, has joined us as chief financial officer.

David brings deep medical technology experience, paired with a strong operational background, and we are very happy to have him on board. In addition to David joining the team, we have made several other leadership changes, including the appointment of Duane Wilder as our chief commercial officer, as well as expanding our board of directors. In February, we announced the addition of Daniella Cramp to our board of directors. Daniella is a senior vice president and president of bioproduction at Thermo Fisher.

Prior to joining Thermo Fisher, Daniella held senior roles at Johnson & Johnson, including U.S. president for Biosense Webster, J&J's electrophysiology business. In addition, John Sheridan, president and CEO of Tandem Diabetes Care, joined our board as of this week. Previously, John worked extensively in the cardiology field, including his time with Volcano, where he and I and many other members of the team here at Acutus, helped build the company's highly successful image-guided therapy business together.

In the fourth quarter, as well as here in the first quarter, our team has been hard at work installing consoles and laying the groundwork for further adoption of our products. We're also pressing forward on the planned expansion of our product lines through targeted R&D efforts, and we are on track to launch several new products this year, as well as initiate key clinical trials. Reflecting on our performance and forward outlook, I want to thank my Acutus colleagues for their tremendous commitment and dedication to executing our strategy. It also goes without saying that I remain in awe of the heroic efforts of our physician customers and healthcare providers to deliver care to patients.

We continue to be as excited as ever about the potential to change the treatment paradigms in electrophysiology. Nothing gives us more satisfaction than seeing our technology facilitate transformational patient care and a better physician experience. This is our guiding principle here at Acutus, and it keeps us focused on our mission. We were excited to see several live cases presented at the AF Symposium in January that featured both our AcQMap mapping system and AcQBlate Force Sensing Ablation Catheter.

One case that stood out involved a 74-year-old female with recurrent symptomatic persistent atrial fibrillation, or AF, who underwent an ablation procedure with the AcQMap mapping system and the AcQBlate Force Sensing Ablation Catheter. A remap strategy was executed to tackle three arrhythmias, both left and right-sided, atrial fibrillation, typical atrial flutter, and atypical atrial flutter. This case was presented by Professor Tim Bets, who commented on the excellent handling of the catheter, along with the superior conduction properties of gold compared to the more commonly used platinum-iridium for AF ablation. This case, among several others featured at the symposium, reinforces the benefits of the Acutus technology, particularly when using our full product suite, including our diagnostics and mapping systems and now our proprietary ablation catheter and system.

I will provide more detail on the AcQBlate Force Sensing Ablation Catheter product launch later in the call, but overall, the early performance of our new therapy system and catheter has exceeded our expectations and represents a critical validation of our overarching strategy. For those of you who follow our clinical development activities in scientific journals or via our website, you'll know that 2020 was an important year for us. During the year, our company and independent investigators have published an array of key papers covering our disruptive mapping technologies, as well as case series and clinical vignettes, highlighting the unique contributions of our mapping system as used in troublesome complex cases. I'd like to highlight a paper recently published jointly by two premier centers in the U.K., the University of Oxford and the Royal Brompton Hospital.

This paper published online in the Heart Rhythm Journal reported on the real-world application of the core to boundary mapping and ablation approach, first used and reported on in our seminal UNCOVER AF study from circulation 2019. For context, the core to boundary mapping and ablation approach uses our mapping system to identify the potential source of the arrhythmia or the core and then ablating that core and tying it off with a short line connecting to the nearest anatomical boundary. The premise is that this approach allows for better outcomes and less ablation energy delivered. In this paper, the author reported on their results in treating 40 consecutive patients with persistent and long-standing persistent atrial fibrillation as compared to 80 propensity-matched persistent AF patients treated using our competitor's system at the same two centers but using a more conventional and non-patient-specific anatomical approach.

The authors using the prescribed core to boundary individualized approach, facilitated by the Acutus system, reported a very impressive 24-month freedom from atrial fibrillation and/or atrial tachycardia of 67% of patients with persistent and long-standing persistent AF. This compares to the matched control arm, freedom from AF and AT of just 46% at 24 months. Simply put, patients in the control arm were roughly 50% more likely to experience AF or tachycardia after their ablation procedure than those in the Acutus treated arm. Further, in the Acutus arm, an impressive 35 out of 40 treated patients or 87.5% were AF-free and off antiarrhythmic drugs at 24 months.

And operators were able to achieve acute termination out of AF during the ablation procedure itself in over 70% of patients versus acute termination in the control arm of only 10%. Seeing the operators who were also participating enrollers in the earlier uncover AF trial take the learnings from UNCOVER and apply them to their persistent patients in daily clinical practice and deliver these extraordinary results is extremely gratifying and exciting for us here at the company. Turning to our performance in the fourth quarter. Consistent with our disclosure on January 13, 2021, fourth-quarter 2020 net revenues were $2.6 million, compared to $0.7 million in the prior-year fourth quarter.

Despite significant headwinds from COVID, we continue to add new customers, as well as upgrade existing customers, to our groundbreaking second-generation electrophysiology mapping system. During the fourth quarter, we increased our worldwide installed base of second-generation AcQMap consoles to 51 up from 37 consoles at the end of the prior quarter. The combination of new installs and upgrades, plus our first-generation consoles, brought the total global installed base of consoles to 58 as of December 31, 2020, compared to 49 at September 30, 2020. In the U.S., our total installed base increased to 37 units from 29 in the prior quarter.

While the installed base outside the U.S., including placements through Biotronik, totaled 21 units, up from '20 in the third quarter of 2020. While console placement activity was robust during the fourth quarter, we observed some COVID-driven impacts on placements. Activity in Europe during the fourth quarter became complicated as travel restrictions were enacted and various hospitals shut off access to vendors. In the U.S., we saw similar pandemic-related challenges surface during late November and early December.

We did see installations in both the U.S. and OUS originally scheduled for the fourth quarter of 2020 slide a few weeks out into early 2021. As always, we strive to take advantage of our nimbleness and creativity in times of great change, and we have been successful in executing virtual installations and training, as well as customer in-servicing. Now, moving to case volumes.

As I discussed at the J.P. Morgan Healthcare Conference in January, we saw meaningful fluctuations in volumes throughout Q4. Our business had momentum early in the quarter with strong sequential procedure growth in October. However, COVID-related headwinds drove a sharp drop in the second half of November and December.

These challenges persisted through the early part of Q1, but we have started to see case volumes pick up in recent weeks. Looking ahead, we are cautiously optimistic that the trends will continue to improve. As such, we are changing -- or we're charging forward on our product launches and commercial and clinical development activities. The commercial introduction of our AcQBlate Force Sensing Ablation Catheter and system in Europe has been met with enthusiasm from our physician customers who have lauded the handling and stability of the beveled gold-tipped catheter, as well as smooth setup and operation of the associated stack of electronic accessories, including the fore sensing console, RF generator, infusion pump, and controller unit.

Electrophysiologists have also been impressed with the reduction in saline irrigation due to the combination of the gold tip and reduced flow rate. As a reminder, we and our partner, Biotronik, commenced our limited market release of this product line in early January in the face of rolling COVID shutdowns in key markets in Europe. In just the first nine weeks since introduction, the catheter and system have been used in 10 centers, in five countries by 17 different physicians and a variety of procedures, including AV node, atrial tachycardia, and atrial ablation. The rapid uptake and acute clinical results give us confidence that the combination of our innovative mapping technology and the novel ablation catheter and system is going to significantly improve workflows, physician engagement, and ultimately, our ability to increase share and revenue per case in accounts across the U.K.

and Europe. Lastly, we have received consistent and positive customer feedback, highlighting that the AcQBlate catheter can be both integrated with the AcQMap system for more complex procedures yet also be used as a stand-alone system for less complex procedures on the right side of the heart, where simplicity and procedure expense management are important, but where contact force is desired. Demand for the AcQBlate catheters and related electronic components is currently outpacing supply, and we are hiring and training manufacturing personnel to meet the accelerated demand. Importantly, we think the early success we are seeing in Europe is a harbinger of things to come around the world.

We have demonstrated clinical differentiation with our core mapping technology, and the introduction of an ablation catheter and system will further enhance the value we bring to patients and physicians. The results and receptivity we are seeing in Europe only heightens our enthusiasm for commencing U.S. clinical trials for our full array of ablation catheters and accessories. From a commercial execution perspective, our Europe direct commercial organization has been effectively building physician and hospital interest in our broad EP product offering.

The team is driving strong results across all product categories currently available in the region, including our second-generation consoles, our AcQMap consumables, and most recently, our AcQBlate Force Sensing Ablation Catheter. We are also eager to conduct a full launch of our septal crossing and access catheters with this team in the second quarter. Our international commercial efforts are further augmented by our bidirectional distribution agreement with Biotronik. This agreement gives Acutus the ability to leverage Biotronik's global sales distribution infrastructure and helps us more rapidly achieve global reach.

During the fourth quarter, we sold our first two consoles to Biotronik for new accounts in Switzerland. During the quarter, Biotronik mappers, who have undergone Acutus's extensive month-long mapper training program, performed their first stand-alone mapping cases. Biotronik and Acutus are actively working in concert on regulatory approvals and other countries as well, expanding our footprint as we first envisioned when we entered into the agreement. We continue to be very pleased with our relationship with Biotronik and are encouraged to see strong engagement from local teams as we rely heavily on distance learning for our hardware, software, catheters, installation support, and related case knowledge during these challenging and travel restricted times.

While we are seeing strong execution and sales performance in Europe, direct organization, and through our Biotronik partnership, we have not achieved our goals in the U.S. Despite hiring some of the absolute best and brightest from the electrophysiology community into our commercial organization, we have been slow with the initiation of some of our installs and struggled to drive uptake and consistent utilization. COVID has, no doubt, layered significant challenges for a new-to-market, early stage company like ours. However, it is my view that there are other execution factors at play here, primarily related to inadequate targeting, physician segmentation, and proper training and direction of our commercial team.

I take full responsibility for this. After careful self-assessment, I decided to bring in a battle-tested former colleague of mine, Duane Wilder, to run our commercial organization as Chief Commercial Officer. Duane started at Acutus on March 1. In a prior life, Duane and I, together with the team at Volcano, have competed with entrenched incumbents before and one.

He is a world-class commercial leader, and he has a demonstrated ability to develop markets, drive adoption of new therapies, navigate the capital equipment sales landscape, and successfully challenge large and entrenched incumbents. These factors that yielded success at Volcano are very much the same foundational elements that will drive future performance at Acutus. In addition to the investments and upgrades we are making to our commercial team, we continue to make strong progress on our pipeline and clinical developments, as well as gain regulatory clearances and approvals. Our teams have made major progress on building out the scope of our left heart access product lines and on the development of our pulse-field ablation or PFA technology.

We continue to advance our PFA program and expect to initiate first-in-man and pilot trial activities later in 2021. To illustrate the energy and pace of our innovation, we have conducted 59 preclinical labs since July 1, each testing one or multiple new products featuring elements of our full product portfolio, be it PFA, conventional RF ablation, septal crossing, or conventional contact and non-contact mapping. Our clinical and regulatory teams have also been diligently working through the process to initiate three separate U.S. IDE studies for our therapy catheter lines, and we expect to enroll our first IDE patient in our FLOODER trial with our ablation catheter and system in the U.S.

in the next several weeks. As we progress through formal initiation of these therapy trials, we will provide relevant updates in earnings calls at medical meeting presentations and in other public disclosures. Closing with key regulatory updates. Following several important achievements in 2020, including CE Mark approval for our AcQBlate Force Sensing Ablation Catheter and the AcQGuide flex and mini transseptal access systems, as well as U.S.

510(k) clearance for our second-generation second-generation AcQMap patient electrode kit, we expect a very busy and productive 2021. Over the course of this year, we anticipate receiving CE Mark on several products, including our AcQMap 2.0 mapping catheter and AcQGuide MAX delivery sheet, AcQCross QX solo transseptal access system, and our AcQGuide view delivery sheet with localization electrics. In the U.S., we anticipate 510(k) clearance on the AcQCross QX solo transseptal access system and the AcQGuide MAX 2.0 delivery sheet. Each of these products is designed to provide specific procedural advantages for our physician customers and to help the company garner increased market share, as well as improved revenues and contribution margin per procedure.

I am confident that no EP company on the planet has a more innovative, creative, and productive product development team than we have here at Acutus, and our recent releases and near-term product improvement pipeline bears that out. With that, I'll now turn it over to David for our financial results. David?

David Roman -- Chief Financial Officer

Thank you, Vince, and good morning, everyone. I'm very excited to join Acutus and to be working with Vince and the entire organization. In my first few weeks on the job, I have seen a tremendous commitment to our vision and an unwavering dedication to our mission of serving patients and the clinical community. A few days ago, I had the opportunity to observe several cases here in Southern California, visit with customers and meet some of our sales teams.

I am very encouraged by these interactions, and I will be on the road in the coming months to get further acclimated with their field teams and key customers. In my remarks today, I will provide details on the fourth-quarter and full-year 2020 operating results, as well as our outlook for 2021. Our revenues for the fourth quarter of 2020 were $2.6 million, up from $0.7 million in the year-ago quarter. The Q4 year-over-year revenue increase was driven by procedural adoption for our broad range of EP products and transseptal access devices, the conversion of consoles previously installed under evaluation agreements, and the implementation of the Biotronik distribution agreement.

Gross margin was negative 90% for the fourth quarter of 2020 compared with negative 254% in the fourth quarter of 2019. We continue to make significant investments in our manufacturing infrastructure to support our long-term growth outlook. As volume increases -- as volumes increase and our targeted manufacturing cost optimization programs take hold, we expect our gross margins to improve. Operating expenses were $25.7 million in the fourth quarter of 2020, compared to $16 million for the same period of the prior year.

R&D expenses were $9 million in the fourth quarter compared with $7.5 million for the same period of 2019. The increase in R&D expenses was primarily related to investments in the AcQBlate Force Sensing Ablation Catheter development, our PFA program, console enhancements, and upgrades to our AcQMap mapping catheter. SG&A expenses were $15.2 million in the fourth quarter of 2020, compared with $7.8 million for the same period last year. The increase was primarily due to the expansion of our commercial team in conjunction with our full commercial launch and an increase in G&A for public company-related costs.

As a reminder, we present our net loss on a GAAP basis and non-GAAP basis to exclude items that we believe are not representative of core operating results. For a complete reconciliation of our GAAP financial measures to our non-GAAP financial measures, please refer to the tables included with the press release and 8-K that we issued today. Excluding specified items, our non-GAAP net loss for the fourth quarter of 2020 was $24.9 million or $0.89 per share, compared to a non-GAAP net loss of $17.9 million for the fourth quarter of 2019 or $1.06 per share after giving effect to the pro forma conversion of our convertible preferred stock. To briefly recap full-year 2020, revenue totaled $8.5 million versus $2.8 million for the full year of 2019.

The increase was driven by higher direct sales of Acutus disposables, sales of our AcQMap consoles, and distributor sales through our partner, Biotronik. Gross margin was negative 88% for the full year of 2020 compared with negative 226% in the prior year. The improvement compared to 2019 was attributable to increased revenue and higher production volumes. Total operating expenses of $83.9 million for full-year 2020 compared with $66.2 million for the prior year, with the increases stemming from growth in our commercial organization, costs related to being a public company, and investments in key R&D programs.

Our non-GAAP net loss for the full year of 2020 was $83.7 million or $3.91 per share, compared to a non-GAAP net loss of $76.2 million in 2019 or $5.77 per share after giving effect to the pro forma conversion of our preferred convertible preferred stock for the fourth quarter of 2019. Our total cash balance at the end of the fourth quarter of 2020 was $139.9 million. Looking to 2021, I would like to provide some further detail regarding our full-year and first-quarter outlooks that were included in today's press release. The early part of 2021 showed a continuation of the trends that negatively impacted Q4 results.

That said, we are starting to see those headwinds abate with the business picking up globally, albeit still with some pockets of disruption, such as in France and Italy, where electric procedure restrictions are going into place as we speak. With global volume trends improving, we do expect to see modest sequential growth from Q4 to Q1 and project revenue in a range of $2.6 million to $3 million, compared to the $1.6 million we generated in the first quarter of 2020. Based on current market trends and planned internal initiatives, we anticipate further sequential growth in Q2 and a more meaningful step-up in Q3 and Q4. In addition to market conditions impacting results, the underlying demand for certain products, such as the AcQBlate Force Sensing Ablation Catheter in Europe and our transseptal crossing devices, have exceeded initial projections in our own production capacity.

We expect these supply constraints to start easing during the second quarter. As the investments we are making to increase capacity take effect, sales performance is also expected to pick up throughout the year. Lastly, as console utilization increases and physicians gain further experience with our technology, we also expect to see a higher rate of sales and sales conversions on capital equipment. Putting this all together, we project full-year revenue to be in a range of $22 million to $30 million.

From a phasing perspective, we expect 2021 revenue to be heavily weighted to the back half of the year as a result of the timing of capital sales, the pace of manufacturing ramp for the AcQBlade fore sensing ablation catheter and transseptal access products, the impact of anticipated new product approvals and launches, overall procedure volume growth and improved execution in the U.S. With that, I'll now turn the call back to Vince for closing remarks.

Vince Burgess -- President and Chief Executive Officer

Thank you, David. Before opening the call for Q&A, I want to reiterate our priorities for achieving our mission to transform EP for patients, physicians, and healthcare systems around the globe. Early evidence of the value of our complete product offering brings to physicians and the pipeline we have on the horizon further support our conviction in the long-term opportunity here. Bringing disruptive technologies to market is never linear, and we are focused on three key areas to achieve our vision and drive shareholder value.

First, technology and innovation leadership. We remain steadfast in our product development efforts with our internal R&D engine delivering important new innovations, as well as extensive clinical developments over the short and long-term horizons. We will continue to look to augment these efforts through selected licensing and partnership opportunities. Second, commercial execution.

Our sales and therapy management teams are critical to driving adoption and helping shift the paradigm. While sales coverage expansion is a top priority, we are also laser-focused on performance and ensuring execution across the entire commercial organization, including through our relationship with Biotronik. Third, operational excellence. As we drive increased sales volumes, we recognize the importance of improving our gross margin, as well as continuing to invest in rigorous quality standards.

At the same time, we will be disciplined with our cash management to ensure we are judiciously deploying capital to support growth. We appreciate your continued interest and support, and we'll now open the call to questions. Operator?

Questions & Answers:


Operator

[Operator instructions] Our first question comes from Robbie Marcus with J.P. Morgan. Your line is open.

Robbie Marcus -- J.P. Morgan -- Analyst

Great. Good morning and thanks for taking the question. Vince, I was hoping we could start off to dive into the thought process behind guidance a little bit more. How are you thinking about unit placements versus utilization? Obviously, we saw a pretty decent unit placement in fourth quarter, but much lower utilization.

What are you expecting for first quarter? And how does that play out through the balance of the year? Because obviously, the more units you place, volumes can hopefully come over time. Just trying to get a sense between the balance between the two. Thanks.

Vince Burgess -- President and Chief Executive Officer

Yeah. I mean, I think the pace of unit placements -- I mean, we certainly in our funnel, this quarter and next and really through the year, we have plenty of customers raising their hands and saying they want to go through the rather laborious process of bringing in a unit and getting started. The discipline that we are instilling and installing now, and I'm driving this through Duane, our new CCO, and through David and our entire commercial team is we've got to make sure that these systems that get placed are placed into the hands of physicians and teams at hospitals that are deeply committed to taking a hard look at how they're treating their persistent patients and really working with us to streamline their workflow, adopt some changes in their procedural technique. And I think it's fair to say that the changes that we are asking physicians to make are a bit more substantive, particularly in the U.S., than we had originally anticipated.

It's not wrenching change. It's not a complete 180. But there is work to be done there. And that's, as I alluded to, I think, on our last call, we recognize this kind of in Q4 where we were just understaffing our initial site install and launch and not adequately having sort of bodies in the right place at every step of bringing a new physician.

So my focus this quarter and next is on making sure we target the right customers that really want to go on the journey, service the daylights out of them and bring them up right so that when we get a system installed, we get great uptake and utilization. So I think we certainly have the ability to place units along the lines of what people have in models and prior models. One of the things that we're looking at hard here, though, is do we do we want to go at that pace? And do we have the staffing? And is our staff trained and configured in such a way to make sure that every time we install a unit, we get the kind of uptake we need. So I think you'll see in some of our numbers, going forward, maybe a slight change in the pace of new installs, but really much more focus -- intense focus on making sure those systems come up, come online, start generating cases sooner than they have and generate better utilization coming out of the gates.

David, do you have anything you want to add to that?

David Roman -- Chief Financial Officer

Robbie, the one thing I would add to that, and this is underscoring Vince's commentary around account segmentation, is it is critical for us that we have these -- our systems placed in the right accounts with the right physicians. So as I start to see contracts come across my desk now, what I'm observing is some, really, marquee centers where we expect to place systems in the very near term. And I do think that that will help continue to improve the efficiency and value of the systems that we were placing. But safe to say we do expect the installed base to continue to grow in 2021.

And it has your state.

Vince Burgess -- President and Chief Executive Officer

I mean, to stratify into three kind of really, really rough groups, and when you bring a new technology like this to market, of course, you've got late adopters who just aren't early targets. And then you have people who really get it and really want to embrace what you're doing and invest together with you to take their centers and their procedures to the next level. And then there's a bit of a tweener group there, Robbie, who just want to give it a try. "It sounds interesting.

We'll give it a try." And I'll just tell you, we got to focus on those centers that are just committed to work with us and do the hard work, fly out, come to training before the center takes delivery of their system, or go to a training center with us, commit to a certain minimum number of cases rather than have the system come in and get a small number of cases under their belt and then perhaps go on to the next widget if you will. And I have seen this before in my career. We just need to have the discipline to focus on those folks that really want to go on the journey and fix this persistent AF problem. Because nobody's fixed it yet.

And there are no signs that any of the other technologies and companies in the market are bringing anything new to this market to address that vexing problem.

Robbie Marcus -- J.P. Morgan -- Analyst

Got it. And maybe as a follow-up, David, as Street is basically bringing down numbers by a pretty decent clip versus where we were before coming out of the IPO. How are you thinking about spending your cash flow needs? And how long do you think your current cash balance will last for? Thanks.

David Roman -- Chief Financial Officer

Sure, Robbie, and thank you for the question. So maybe I'll take each piece of that. So I'll start with spending and then go to cash. So one of the things that we are taking a very hard look at here is how we are deploying all of our internal resources.

And Vince laid out during his prepared remarks our top priorities to drive growth and value both in the near term and over time, which innovation, commercial execution, and operational excellence. From my past experiences, being in an environment that are very cost-conscious and rigorous with capital deployment, I am bringing that same mentality and approach here to Acutus. We are working judiciously to prioritize our investments and ensure that we are putting our dollars in places that can have the most significant impact, both in the immediate term while also supporting long-term growth. On the cash side, we did talk about ending the fourth quarter with $139.9 million of cash.

We continue to believe we have sufficient cash to fund our operations over at least 12 months, and we'll evaluate this as we go forward. But a combination of factors are going to play in here, one of which is obviously revenue growth. But I also want to underscore a number of opportunities to control expenses through the P&L, as well as optimize things like inventory. To maybe give you a little bit more perspective, and I wouldn't be surprised if we get this question on this call, as we talked about supply constraints impacting some of our results here in the guidance.

But at the same time, you point out correctly that we are bringing down numbers relative to what you had expected at the time of the IPO. The challenge we actually face is that there's been a bit of a mismatch in the demand for certain products and what we had previously contemplated, which has also created a higher inventory balance than what we would like to see. So we'll be actively managing our production volumes to ensure rightsizing inventory as well, which should contribute positively to cash flow.

Robbie Marcus -- J.P. Morgan -- Analyst

Great. Thanks, David. Appreciate it.

Operator

Thank you. Our next question comes from Bob Hopkins with Bank of America. Your line is open.

Bob Hopkins -- Bank of America Merrill Lynch -- Analyst

Great. Good morning. Can you hear me OK?

Vince Burgess -- President and Chief Executive Officer

Yeah, we got you, Bob. How are you?

Bob Hopkins -- Bank of America Merrill Lynch -- Analyst

Great. Good. Good. How are you guys? Maybe let me just offer my congratulations on your decision.

Look forward to working with you here. There's a bunch of quick little questions I'd love to ask. And just following up on that commentary on cash. Where does this guidance for 2021 contemplate you'll be at year-end from a cash perspective, David?

David Roman -- Chief Financial Officer

Yeah. It's a fair question, Bob. I'm not ready to give cash flow guidance for the year at this point in time.

Bob Hopkins -- Bank of America Merrill Lynch -- Analyst

OK. I mean, you said at least 12 months. So I just want to -- I know we're going to get the question afterwards. The question will be, I think guys have to come back to the capital market sometime in 2021.

But I guess we'll look forward to hearing when you have more to say on that front.

David Roman -- Chief Financial Officer

Yeah. And sorry, I would say, Bob, that we are comfortable for an 18-month period.

Bob Hopkins -- Bank of America Merrill Lynch -- Analyst

OK. OK. And then two other quick ones if OK. And one, just following up on kind of the inventory [Inaudible] and what you're saying in terms of a little bit of a misalignment in terms of what products were [Inaudible].

Just give us a backdrop there. Because it is an interesting data point, but at the same time, you're generating very [Inaudible] inventory problem, generating so little revenue kind of really [Inaudible]. And then I have one final follow-up. Thank you.

Vince Burgess -- President and Chief Executive Officer

So, Bob, I'm sorry. We only got about two-thirds of the words there. Can you just repeat the question? It's really hard to track.

Bob Hopkins -- Bank of America Merrill Lynch -- Analyst

Oh, sorry about that. I'm might have dropped. I was just wondering how you ran into an inventory issue when you're this early in the process and not generating a lot of revenue at this point.

Vince Burgess -- President and Chief Executive Officer

Well, I mean, you have to go back and look at the breadth of our product line. We have gen 2 consoles. We have RF generators and irrigation pumps and cubic force devices and a whole line of electronic accessories. And then we have our sheets, our septal crossing, a brand-new family of, I think, seven or eight or 10 different septal crossing devices we're launching in this quarter.

We've got our basket catheters and then we have our ablation catheters, which we're just spinning up production there. So we did our level best to anticipate when those products would be approved. And then we do limited market releases when we first came out with those products. So it's just prudent to restrain your builds while you make sure when you launch these products, they show up in the hands of the customers and they work as intended.

And then you tend to dial up your production after that. And then we obviously have been building away our gen 1 basket catheter, and then we are transitioning from our gen 1 to our gen 2 basket catheter. So all of those launches are some of the hardest logistical things you can do in the medical device business. And we're relatively new in the game here.

And I mean, frankly, the R&D team has just done such a great job cranking out a fee of new products for us. And I would just say planning and inventory mix has been -- we've been on a little bit of a learning curve there, which has impacted us. So we don't have enough ablation catheters and electronic stacks to supply what we're being asked for from Biotronik and our European team right now, and we don't have enough septal crossing devices to fill the demand at the moment. And we've held off on our European launch of that product in its entirety until we get up to sustainable levels with appropriate safety stock.

David Roman -- Chief Financial Officer

And, Bob, the only thing I'd add to that is there are some fairly, I would say, industry-standard practices that we're going to look to make sure we adopt here to drive more effective planning around both our, obviously, sales forecast but, more importantly, connecting that to our manufacturing operations and having a completely integrated sales and operating planning process to ensure that we have the right products being made in the right capacity for the right markets at the right time.

Bob Hopkins -- Bank of America Merrill Lynch -- Analyst

And then last quick question, Vince. You had a sort of slow start in the U.S. It might just be due to the fact like you just need more clinical evidence for physicians to get them over the goal line and really engage with the technology. How much of this is around data?

Vince Burgess -- President and Chief Executive Officer

I think very little of it is around data, to be honest with you. If you look at how physicians are treating patients today for persistent afib, ask them what data they're guiding their procedure on and their approach, whether they're doing PBI plus posterior wall or roof line or what have you, it's generally not driven by data, Bob. It's driven by workflow and familiarity and just kind of trends. What physicians in the U.S.

focus on first is workflow and just ease of use. And I think where we have been a bit slow here is in really tuning up our own commercial and clinical teams and getting them in a position to educate some of these physicians and their staff and train them up on how to transition their current workflow over to a new workflow. And I don't know how to quantify the level of difference. But like I said, at the start of the call, I think there's a little bit more change here than maybe I and we had anticipated.

And in order to get somebody to invest the time and energy to step back and say, "OK. Tell me again, what am I doing here? How am I interpreting this map? How should I be thinking about this new ablation strategy?" That just takes a bit more work and a bit more time and a bit more face time in front of people. It probably means bringing some of these doctors into animal labs to do kind of road test cases before they start using the system. I think we'll be doing a lot more of that.

All of this, each single element of what I just described, is just harder to do in a COVID environment. It just takes more time, harder to get mind share, harder to get time, harder to get people to get on an airplane and go do an animal lab and do a training program. So and that's not just doctors, but literally our own internal people. And this is a very hand-to-hand combat, hands-on business here.

So I would say there's just been this sort of thousand cuts kind of an issue with COVID that's just made every little aspect of doing a full rollout of a new procedural approach during travel-restricted, COVID-impacted times.

Bob Hopkins -- Bank of America Merrill Lynch -- Analyst

Got it. Thank you.

Operator

Our next question comes from Margaret Kaczor with William Blair. Your line is open.

Margaret Kaczor -- William Blair & Company -- Analyst

Hey, guys. Good morning.

Vince Burgess -- President and Chief Executive Officer

Good morning.

Margaret Kaczor -- William Blair & Company -- Analyst

I would want to keep going on what you guys have talked about with Bob at the end. And these are kind of the number of issues that you've identified in the U.S., yes. And I guess the question specifically is how quickly can you change those and really see an impact to utilization? What stage are you in making those changes? And what gives you that confidence that it can have a positive impact as soon as the second half of the year?

Vince Burgess -- President and Chief Executive Officer

Yeah. It started to crystallize for us. I would say, the last week of December, first week in January. We hired, I think, one of the best trainers in the business right around that time, a guy named Mike Buy, to come in.

And we very quickly just executed on a plan to pull every single one of our commercial people in the U.S. out of the field and fly them down to Orlando to the Nichols Training Center and spend a week with them down there, training people up. And we've repeated that a couple of times over the last six weeks, to train and retrain and really start to kind of bake in some of the real nuts and bolts of how you make sure you have your early procedures with a new customer get done and get done right. We're also kind of built-in suspenders staffing cases with new physicians.

So I kind of executed a mandate that, where possible, we have two mappers in every case with a new doc and maybe a sales rep at the bedside in those first five or 10 cases just to make sure that we get every aspect of the procedure right. Now, all that takes a lot of coordination. Targeting and segmentation takes a lot of discipline. Sometimes, you just have to walk past centers that have raised their hand and said they want the system.

But if they just don't have the right mindset. Sometimes you just want to say, "Hey, not for now." That's where I decided -- one of the reasons I decided to bring in Duane, who I worked with day in, day out for eight years as we got Volcano up and running and off the ground and flying. Duane did this every day as we were getting into the IVUS and FFR business and competing with Boston Scientific, and now, St. Jude Radi.

He knows how to do this. And he's just a disciplined, organized commercial executive that is just the kind of guy needed to take the vision that we had here in the four walls of the home office and put it into practice in the field day in, day out. And I think as we do this, we'll execute and tighten things up and dial in this process and the site launch process in Q1 and Q2. And I think we come out of Q2 with a very good handle on how to do this and do this right.

David Roman -- Chief Financial Officer

And I think, Margaret, we do have some very good examples of where this does materialize. In the case that I observed actually at several -- it was multiple cases, when there is an experienced mapper and physician working in tandem with one another and the right training having been completed, it's a pretty actually seamless procedure. The cases that I saw was a pretty -- the first patient was a very complex individual who had two failed ablations and came in and he mapped with an AcQMap catheter. Physician was able to isolate two ablations, actually both left and right side of the heart, and complete the procedure in under 50 minutes.

And this is a physician who, at that point in time, they completed about 76 cases in total. So you can see once that learning curve in initial training period is complete, there is a pretty significant ramp. And you really can see a well-orchestrated procedure room.

Vince Burgess -- President and Chief Executive Officer

Yes. I had a similar experience. I was up in Boise in the Northwest, a brand-new account, we just spun up about three, four weeks ago, and we had a team of three of us. And I was there just to kind of observe.

And I'll tell you, these are very complicated cases that the operator does up there. And the install just what flawless. Customer is thrilled. And we have very, very high hopes for how that system is going to spin up and the utilization we're going to see out of that account.

Margaret Kaczor -- William Blair & Company -- Analyst

OK. So that kind of leads me to two sub-questions of a bigger question, which is utilization ramp expected both this year and then going into '22. You've got two different dynamics, right? You're, on the one hand, stepping back in the short term, maybe putting more people in the field, having two mappers in a room for a little while, at least, takes that second mapper away from another account, and so on. So how much of that, I guess, is implied within guidance the change in productivity of those reps? And then I guess more importantly, as we look into '22 how should we think about utilization there? Because you guys did actually have a pretty steep utilization curve.

Can we get back to that? Yes, maybe more specifically, when are you going to get to that one procedure per system per week?

Vince Burgess -- President and Chief Executive Officer

Well, you know, I think what we're seeing early, and it's early days in Europe where we have ablation as well, the catalytic effect of having the ablation and the mapping together in these cases really helps get physicians and centers ear to schedule cases and do cases with you and build that muscle memory by doing a bunch of cases in a day, in a bunch of cases in the first couple of weeks. So I'd point out in the U.S., we are probably two and a half, three weeks away from initiating our IDE flutter trial. That's north of 100, 110 patients, I think, in 15 centers. And then two, three months after that, we initiate concurrently our AFib trial, which is, I think, north of 300 patients.

And that's, I think, north of 30 centers. So by being able to layer in and bring in that ablation catheter capability, which, by the way, is much more seamlessly integrated with our mapping system procedurally, and draw physicians in, "Hey, let's do a bunch of cases as part of this clinical trial." Obviously, the clinical trial is separate and apart from our commercial activities. But the fact of the matter is if a physician and the team do procedures as part of a clinical trial. They build that muscle memory, the familiarity of the cabling and travel shooting, the map interpretation, the therapy approach, we think that that will help catalyze the learning and the familiarity and the adoption and the scheduled pacing as we get into kind of mid-year here.

And obviously, that will continue into the following year.

Margaret Kaczor -- William Blair & Company -- Analyst

Got it. Thanks.

Operator

Thank you. Our next question comes from Bill Plovanic with Cannacord. Your line is open.

Bill Plovanic -- Canaccord Genuity -- Analyst

Hey, great. Thanks. Good morning, and thanks for taking my questions. I'm going to change it up a little here.

And with Duane coming in, what I'm trying to think of is just operationally. And how do you think of the pace of sales force expansion structure in the U.S. or just operationally now that he's come in and been on board a couple of months? How are you thinking about that today versus, call it, six, nine months ago?

Vince Burgess -- President and Chief Executive Officer

Well, if you recall from a prior call, we accelerated some of our mapping hires in Europe and some sales folks in Europe that were over and above the plan that we had in and around the time of the IPO because we saw the ablation catheter coming and we wanted to be prepared for that launch. In the U.S., we did accelerate some mapping hires as well in the back half of last year, which is responsible for a bit of the overage in the SG&A line in the back half of 2020. Those people take a certain amount of time to spin up and get up to speed and get fully trained. We will make some additional adds there, particularly on the mapping clinical support side of things in this year.

And we might rejigger a little bit the structure of the sales side of the organization. But I think if you look at our projected commercial spend in the U.S. and Europe in terms of the aggregate dollar spend, I feel like we've got that pretty well dialed in now. We might shift some bodies around between sales and clinical support and vice versa, but -- and location of where people are, but we don't see really material change in how we're thinking about the body count and the spend there in the year ahead.

Bill Plovanic -- Canaccord Genuity -- Analyst

Great. That's helpful. Thank you. And then I think you've touched on it a little, Vince, but really getting into -- what have you learned? You have been out in the field? And I think I'm trying to go a little more higher level here in terms of you've got the system out are there.

In terms of the mapping system, is there any major feature that's not launched in Europe yet that could change your trajectory, number one? We know you have the ablation there. And then the same question as it relates to the U.S., are there any major components, benefits, features to the system that need to get commercialized in the U.S.? And I think you've already given us the ablation timeline. Thanks.

Vince Burgess -- President and Chief Executive Officer

So in Europe, the vast majority of our full product line is available in Europe for both our direct team and our Biotronik partners. We have not really fully launched the sort of the more commodity diagnostic and ablation catheters in Europe yet. And we haven't really launched at all our septal crossing product line over there, which I think we'll do well over there just because of supply constraints. We're saving those units for the U.S., where we're already on launch.

But each of those problems -- or not problems, those gaps should be filled as we exit Q2. Once we do that, we've got a full bag over there. And I'll just tell you, Bill, it's a completely different vibe and energy when you excuse the competitive reps from the lab and you're controlling everything from growing access to mapping to ablation in a case. It's just a better competitive environment.

It's a better level of engagement with the physician. And frankly, the numbers are better as well in terms of the opportunity to grab as much of that wallet and dollar share as you can from a case. And that obviously helps your ROI on your investment and your mapping and clinical team. In the United States, there are a couple of things that we look forward to bringing to the United States.

We've already talked about the ablation catheters and a couple of trials that I think are going to help with that engagement during the trials. Secondly, we have a feature in our software in Europe that is called AcQTrack that is a CE Marked. That is a sort of semi-automated interpretation algorithm that helps physicians and mappers interpret the apps quickly and it kind of guides their eyes to areas of significant interest, kind of a region of interest finder. We are in front of the FDA right now with the submission to bring that over to the U.S.

and I'm super eager to have that over here. Physicians in the U.S. and our mappers are always looking for help from special automation algorithms to help them quickly figure out what the heck it is they're looking at in these very complicated patients and guide their focus, so they can figure out what their diagnosis is and their ablation strategy is going to be.

Bill Plovanic -- Canaccord Genuity -- Analyst

OK. Thank you for that. That's helpful. And then last question for me.

Just I know we've seen a lot of the other companies talking about new systems in the U.S. Have you seen any of this to date?

Vince Burgess -- President and Chief Executive Officer

No. I mean, the other companies do periodic software upgrades. And I think one of our competitors is talking about a new system. I've seen a photograph of it.

Nothing that I've heard from any competitor suggests anything other than slight variations on a 20-year-old theme. They're all the same basic contact mapping platform that they've been throwing with great effect in simple cases. They're doing a good job with simple cases, for sure. But they've been throwing these contact mapping systems at persistent Afib and complex cardios for two decades now.

And nobody that I talk to thinks that those systems have any clear and near-term prospects for changing the game in terms of outcomes.

Bill Plovanic -- Canaccord Genuity -- Analyst

Great. Thanks for taking my questions.

Vince Burgess -- President and Chief Executive Officer

Yeah.

Operator

Thank you. Our next question comes from Marie Thibault with BTIG. Your line is open.

Marie Thibault -- BTIG -- Analyst

Hi. Thank you for taking the questions this morning. I wanted to ask, one, if I could drill down a little bit more on the utilization trends you're seeing right now. I understand in the U.S., that's obviously going to be an area of focus, trying to turn new users into higher-volume users.

So I wonder if you could tell us a little bit about what your legacy users are doing in terms of procedures per system per week and, possibly, where you would like to see the new users kind of come in, if there's sort of a goal or something you have in mind, maybe something we can track throughout the year ahead?

David Roman -- Chief Financial Officer

Yes. Marie, maybe to give you a little bit of specific color on that. It is a very wide range of utilization across our user base now. And I think your characterization is fair, that as physicians gain experience, that utilization rate does increase.

But we look at procedures per console per month, and we have physicians who are really in the sub-one on average, and then we have those that are well over one per week. So that would be in the five to 10 range per month. So it is a very, very wide range. I mentioned one of our largest centers is doing two to five a week.

And that's one physician. So we still have a very wide band and a pretty large standard deviation around the mean level of utilization. We do expect to see the utilization rate for console improve over the course of 2021, including here through the first quarter. And then as Vince mentioned, one of the key initiatives on the commercial execution side is ensuring that once we do open an account, we have the right level of training and support for that account such that we can ramp that utilization faster than what we've seen in the past.

Vince Burgess -- President and Chief Executive Officer

So during our IPO process and around that, the IPO, as you all were getting to know us, a question that I got a lot was -- we understand it's a huge market and it's growing, but we're trying to get our heads around how quickly can you get share within individual accounts given who you're competing with and whatnot. So before this call, earlier this week, I asked our European leader to take a hard look at how we're doing in the sites that are up and running in the U.K. and Europe from a market share perspective now that we have mapping and ablation together. And I thought the results in the centers is pretty encouraging.

And the way it came back was for complex procedures. So this is any kind of a left-sided procedure that's not just a plain vanilla procedure, so a persistent or redo or complex stacked cardia. The estimates they came back with in those centers, was that we were at between -- at the different center between about 10% share and 28% share of those complex procedures, where we have a mapping system, and we have our ablation system. So I mean, to me, that's validating the thesis of where we can go when we have the whole portfolio of products available to our customers, to our mappers, to our sales team.

Marie Thibault -- BTIG -- Analyst

That makes a lot of sense. And then maybe if I could ask one follow-up. Because the feedback so far in AcQBlate in Europe is so encouraging. Can you give us a better sense of how those new users are ramping or getting to a utilization level that you find really sticky compared to what you see in the U.S.

right now, where they don't have AcQBlate?

Vince Burgess -- President and Chief Executive Officer

Well, it's early days, but you launch these -- these are complex systems. And there are four different pieces of electronics and, I think, six or eight cables on a catheter. And they're banging around of these catheters for two or three hours. The performance of the catheter in the system, it's just been fantastic in terms of ease of setup.

The thing just works. And the trackability and torque-ability of the catheter, put against anybody in this industry, based on what we've heard, seen and what I've felt so far, it's we've been in an LMR situation. But I think the majority, if not all of the centers that we've come in and trialed in have raised their hand and said, "This is a very nice system, and we would like to have access to this." So right now, what I just wish I had was more electronic stacks and more catheters to proliferate further out there. One of the things that's really exciting about this product line is it works.

It appears to work very well with our mapping system for these complex cases. But it's also, to my knowledge, really the only full ablation system that can be used without a mapping system to do simple right-sided cases and still deliver those contact force measures. And the other companies have elected not to essentially allow that to try and pull-through mapping across the board. And I'm just all about meeting the customer needs and just given folks what they want.

And that's a great relationship build, a brand builder. And we can make some money on that and drop some top line there as well. And frankly, I don't think it's going to be particularly easy for our competition to pivot in our direction in that regard.

Marie Thibault -- BTIG -- Analyst

OK. OK. That's encouraging. Well, best of luck, and I'll leave it there.

Thank you.

Vince Burgess -- President and Chief Executive Officer

Thank you.

Operator

[Operator signoff]

Duration: 73 minutes

Call participants:

Caroline Corner -- Investor Relations

Vince Burgess -- President and Chief Executive Officer

David Roman -- Chief Financial Officer

Robbie Marcus -- J.P. Morgan -- Analyst

Bob Hopkins -- Bank of America Merrill Lynch -- Analyst

Margaret Kaczor -- William Blair & Company -- Analyst

Bill Plovanic -- Canaccord Genuity -- Analyst

Marie Thibault -- BTIG -- Analyst

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