Good morning, everyone, and welcome to the Boston Scientific First Quarter 2023 Earnings Call. [Operator Instructions] Please also note today's event is being recorded. At this time, I'd like to turn the floor over to Lauren Tengler, Vice President, Investor Relations. Please go ahead.

Thank you, Jamie. Welcome, everyone, and thanks for joining us today. With me on today's call are Mike Mahoney, Chairman and Chief Executive Officer; and Dan Brennan, Executive Vice President and Chief Financial Officer. . We issued a press release earlier this morning announcing our Q1 2023 results, which include reconciliations of the non-GAAP measures used in the release. We have posted a copy of that release as well as reconciliations of the non-GAAP measures used in today's call to the Investor Relations section of our website under the heading, Financials and Filings. The duration of this morning's call will be approximately 1 hour. Mike and Dan will provide comments on Q1 performance as well as the outlook for our business, including Q2 and full year 2023 guidance, and then we'll take your questions. During today's Q&A session, Mike and Dan will be joined by our Chief Medical Officer, Dr. Ken Stein. Before we begin, I'd like to remind everyone that on the call, operational revenue growth excludes the impact of foreign currency fluctuations, and organic revenue growth further excludes acquisitions and divestitures for which there are less than a full period of comparable net sales. Relevant acquisitions excluded for organic growth are Baylis Medical, which closed on February 14, 2022, the majority stake investment in Acotec Scientific Holdings Limited and Apollo Endosurgery, which closed in February and April of this year, respectively. Please note that we have elected to consolidate Acotec results of operations on a 1-quarter lag, thus having no impact to our Q1 reported or adjusted results. Guidance excludes the previously announced agreement to purchase a majority stake in MI Tech, which has not closed. For more information, please refer to our financial and operating highlights deck, which may be found on our Investor Relations website. On this call, all references to sales and revenue, unless otherwise specified, are organic. This call contains forward-looking statements within the meaning of the federal securities laws, which may be identified by words like anticipate, expect, may believe, estimate and other similar words. They include, among other things, statements about our growth and market share, new anticipated product approvals and launches, acquisitions, clinical trials, cost savings and growth opportunities, our cash flow and expected use, our financial performance, including sales, margins and earnings, as well as our tax rates, R&D spend and other expenses. If our underlying assumptions turn out to be incorrect or certain risks or uncertainties materialize, actual results could vary materially from the expectations and projections expressed or implied by our forward-looking statements. Factors that may cause such differences include those described in the Risk Factors section of our most recent 10-K and subsequent 10-Qs filed with the SEC. These statements speak only as of today's date, and we disclaim any intention or obligation to update them. At this point, I'll turn it over to Mike.

Thanks, Lauren, and thank you to everyone, for joining us today. Our first quarter performance exceeded our expectations across all business units and regions, which is a testament to the winning spirit of our global team and the relentless focus on innovation and execution, and we also launched more than 70 new products globally in 2022. In the first quarter 2023, total company operational sales grew 15% versus 2022, while organic sales grew 14%, exceeding the high end of our guidance range of 6% to 8%. We believe that all business units grew faster than their respective markets with differentiated portfolios and a strong commercial execution, supported by healthy procedural demand. First quarter EPS of $0.47 grew 19% versus 2022, exceeding the high end of the guidance range of $0.42 to $0.44. First quarter adjusted operating margin was 25.5%, which is in line with expectations. Now for our 2023 guidance. For second quarter '23, organic revenue, we're guiding to growth of 7% to 9% and full year organic growth of 8% to 10%. Our second quarter '23 adjusted EPS estimate is $0.48 to $0.50. And we're guiding to a full year adjusted EPS range of $1.90 to $1.96. I'll provide additional highlights on first quarter, along with comments on our 2023 outlook, and Dan will provide more details on the financials. Regionally, on an operational basis, the U.S. grew 13% versus first quarter '22 inclusive of 140 basis point tailwind from the Baylis acquisition with notable strength -- with notable organic strength across all our business units. Europe, Middle East and Africa grew 20% on an operational basis versus first quarter '22 with nearly every market growing double digits in the quarter. This strong above-market growth is driven by our diverse portfolio, new launches and commercial execution with healthy underlying…

Thanks, Mike. First quarter consolidated revenue of $3.389 billion represents 12% reported revenue growth versus first quarter 2022 and reflects an $88 million headwind from foreign exchange, slightly favorable to our expectations with continued volatility in foreign exchange rates throughout the quarter. . Excluding this 290 basis point headwind from foreign exchange, operational revenue growth was 14.9% in the quarter. Sales from the acquisition of Baylis through mid-February contributed 90 basis points, resulting in 14% organic revenue growth, nicely exceeding our guidance range of 6% to 8%. Strong revenue performance resulted in Q1 adjusted earnings per share of $0.47, again, exceeding the high end of our guidance range of $0.42 to $0.44 and representing growth of 19.2% versus 2022. Adjusted gross margin for the quarter was 70.4%. We continue to expect full year 2023 gross margin to include a similar level of macroeconomic and supply chain headwinds as 2022 and expect a sequential improvement in Q2, resulting in a first half 2023 gross margin that is higher than the second half of 2023, largely due to the timing of foreign exchange movements in 2022. First quarter adjusted operating margin was 25.5%. We continue to prioritize operating margin expansion and are maintaining our full year 2023 goal of approximately 26.4% adjusted operating margin, representing 80 basis points of improvement versus the full year 2022. On a GAAP basis, the first quarter operating margin was 16.3%. Moving to below the line. First quarter adjusted interest and other expense totaled $78 million, slightly favorable to expectations due to gains on certain unhedged currencies. On an adjusted basis, our tax rate for the first quarter was 12.8%, including discrete tax items and the benefit from stock compensation accounting, slightly higher than expectations due to the timing of certain discrete tax items. Our operational tax…

Thanks, Dan. [indiscernible] let's open it up to questions for the next 35 minutes or so. In order for us to take as many questions as possible, please try and limit yourself to one question. Jamie, please go ahead.

[Operator Instructions] Our first question today comes from Robbie Marcus from JPMorgan.

And congrats on a great quarter here. Let me start with -- and I'll just ask one two-part question here. Great, great performance in the first quarter, particularly on the top line. We all know this is probably the last easy comp from COVID trends in first quarter last year. But would love to get a sense of what are you seeing globally? How sustainable is this? You guided to a slight deceleration in second quarter. Anything to note there other than conservatism? And then second, there have been some news reports lately about M&A on the -- behalf of Boston Scientific. Would love to just get a refresh on your M&A strategy. We've seen a lot more smaller tuck-in type deals historically. Is that still the goal? And any thoughts there?

Sure, Robbie. Thanks for the question. I'll -- second one is easier for me then I'll do the first one. On the second one on M&A, as you know, we've been consistent over the years. As a matter of practice, we never comment on rumors or speculation in the marketplace. On the first question, really proud just of the global performance really across the board. If you look at on the regional side, as I mentioned in the script there, U.S. grew 13%. I think it's really important to note that Europe grew 20%, and Asia Pac grew 15%. So it wasn't one region or one business. It really was across the board performance. And it's encouraging in Europe, in particular, where we have an impressive product line in our EP portfolio and in our TAVI portfolio that's not launched yet in the U.S., which I think is a good signal for the future, as you'll hear about more in Investor Day, as well as in Japan, where we have our POLARx product approved in Japan, but not approved in the U.S. So the fact that the U.S. put up a double-digit number, albeit on some softer comps, as you said, given then the COVID impact. The European and Asia Pac performance is really impressive, and LatAm. And those products -- many of those products are not yet approved in the U.S. So overall, really pleased. You saw almost every business unit grew double digits. But I think, more importantly, not all of our competitors have reported yet, but we'd be surprised if we didn't exceed the peer group across each one of our businesses. So the execution of the team is very -- quite strong. And also, I would say the -- there were clearly some underlying market improvement in first quarter. You saw the public hospitals report, good patient volume, particularly good outpatient volume, which is a good indicator for Boston Scientific, given our portfolio. Nursing shortage is still a challenge for sure, but has improved. And the hospitals being very efficient. So the underlying backdrop for procedure volume demand has improved and is strong and our portfolio really meets the moment around the world. So we're really pleased with the overall performance.

And then specific to Q2, Robbie, just to double-click a bit on that. As Mike said, relative to CRM, that grew 8% in the quarter. We had talked about at the beginning of the year, that kind of growing at market, lower single digits. . We have some replacement trends that start to get a little bit more challenging. So that 8% probably a bit outsized for what we're expecting there. And then Neuromod, as you look at that, that's a business that over the last many quarters has been kind of in that low single-digit range and to pop of 14, that's great in the quarter. But I think a little early to call the ball on that market and say that it's fully recovered. So just the 7% to 9%, I think, is appropriately prudent for second quarter guidance.

Our next question comes from Joanne Wuensch from Citi.

And may I reiterate or repeat, good quarter. One of the things I've been trying to figure out this particular quarter is how much of what we're seeing is easy comps, pent-up demand or something else. I know you can't particularly pick that apart on this kind of delivery but if it is pent-up demand, is there any way to quantify how many quarters or what kind of tailwind that is? And I'll throw my second question in too. Farapulse seems to be doing quite well outside the United States, and we're getting a lot of questions on the timing of it in the United States and what that ramp may look like. If there's any color or sort of level setting of expectations, that would be appreciated.

Sure. On the first one, Joanne, wish we could give you a perfect scientific response to your question on the overall market. I would say it's a healthy market for all the factors that you just indicated. There are some easier comps. Our comp for Q1 was -- it was 9.7%, but that was based on COVID impacted 2021. So maybe the comps are a little bit easier, but clearly, the procedure volume is stronger, as I mentioned, with the hospitals that have reported. The outpatient momentum is quite strong, which fits our portfolio. And we've got a very strong portfolio cadence across the world right now. So I think it's really all those things that contribute to a very strong first quarter and the increase in the guide that we gave for the full year. We typically have said previously that the markets that we serve grow kind of plus 6% in that range. Clearly, the market grew faster than that in the first quarter. But we're not quite ready to call this exceptionally strong market growth for the full year. We think that would be premature to do that and not responsible. So that's why we gave the guidance that we did of the 8% to 10% full year because we do see strong underlying market demand but it may not be quite as strong as we saw in the first quarter, and we'll see as the year goes on. On Farapulse, I was at that EHRA meeting in Europe just last week, and the enthusiasm for Farapulse is very unique, I would say. The MANIFEST data was excellent. And Dr. Stein is here. Can you remind us when the -- when do we expect the trial to read out?

Yes. So our U.S. IDE trial, Joanne, is Advent. It's the most rigorous trial that anyone's done in this space. It's a double-lined randomized trial against conventional thermal ablation. Continue to expect to present that data second half of this year, submit to the FDA at the same time. So again, continue to anticipate U.S. approval in '24.

Would you expect it to ramp similarly to what you're seeing outside the United States?

Sorry, I didn't hear the question?

Yes, sales ramp similar in U.S. versus...

Well, for Farapulse?

Yes.

Yes. So Farapulse, we broke out the #4 in Europe, which is 57%, I believe.

Organically, all EP.

Yes. And that includes POLARx, which makes a very strong contribution, and we expect approvals for POLARx in the U.S. the second half of this year. And we do expect POLARx to be a nice part of our portfolio globally for many, many years. So that's having a nice contribution, and Farapulse is having an outweighted contribution despite some still limitations in supply. So customer demand is outpacing supply, I would say, still at this moment. But clearly, there's a lot of enthusiasm. You saw the MANIFEST trial data in terms of the safety, the efficacy and the procedure, the productivity has clearly been differentiated. So we'll continue to report our progress in EP, but the momentum in Europe is quite strong, and that's why we called that number out for you.

Our next question comes from Rick Wise from Stifel.

Mike, just looking ahead to the September 20 Analyst Day, Boston's excellent CFO recently spoken public, I think, March 1 at my friend Joanne's event and said that he is excited for the next chapter for the company for '23 and then for '24, '25 and '26. And I think you said Boston has the opportunity to have a special chapter for the company. I'm just wondering what do you think, Dan, meant? And what is a special chapter? And does that possibly suggest more willingness, given that everything is happening fundamentally and with the product portfolio to commit to a sustained higher growth rate guidance for the next LRP?

Well, Dan is a smart guy, and he wouldn't have said that unless he meant it. And so I certainly support that. And we'll lay it out more at Investor Day. But just overall, you see the strength of our businesses really across the board, and the portfolio mix continues to help us. It's what we purposely designed and executed on for many, many quarters in a row. Our businesses in the slower growth markets continue to get smaller and smaller as a percent of our sales, and we continue to layer on faster growth markets and better innovation that also help us with the pricing. And you're very aware of many of our key products that are launched outside the U.S. that are not in the U.S. that we can make very -- that we can make very nice gross margins and at high customer demand. So we look forward to bringing those to the U.S. and we'll also tell you about some other products or capabilities that may lie outside our 3-year LRP. But we'll share all that at Investor Day, but we're very excited about the future of the company.

And let me sneak in one quick follow-up on Farapulse. I know that you've been supply constrained on Farapulse generators. Is that situation improving? Will it be resolved by the time you hopefully get U.S. approval? Any update on that situation?

Yes. We do expect that to dramatically improve prior to having U.S. approval, primarily because we will bring in -- we have really important strategic contractors that we have very long-term contracts in place with, were a very much part of our solution. But we're also, in parallel, have internal capabilities that we're ramping up. And so both those things will continue to happen for many, many years. But we do expect, particularly in the second half of '22 -- of '23, I'm sorry, to have enhanced console supply to meet the demand. And we expect by the time the U.S. approval that we'll have significantly more capabilities in this area. So I guess for that reason, it's the only reason why we're happy about the timeline and the slight delay in the U.S. with the trials to ramp up our production. But we expect to be able to meet that demand in the U.S. when we get approval.

Our next question comes from Larry Biegelsen from Wells Fargo.

Congrats on a great start to the year here, guys. So one for Dr. Stein, one for Mike. So Dr. Stein, Farapulse is a single-shot technology with PFA energy, but companies are developing large local catheters and dual energy sources. How are you thinking about the evolution of Farapulse beyond its current geometry and energy source? And Mike, we all completely understand you won't comment on rumors, but there are interesting assets in MedTech that would push you to over 4.5x leverage or require the use of equity because of relatively large deals. Are those options on the table? And just remind us of how you think about ROIC?

Yes. Thanks, Larry...

I will take the second one...

Take the second one.

As a matter of practice, Larry, we don't comment on rumors or speculation. I will comment on -- we did comment on the closing of Apollo in the quarter, which is really going to be a nice asset for us, endoscopy, expand our endoluminal presence and a nice continued focus on category leadership. So we -- our venture portfolio, we've signed Acotec or closed the Acotec deal this year. We had closed the Apollo deal. But like we always said, any future deal speculation, as a matter of practice, we don't comment on.

And then, Larry, on sort of the evolution of Farapulse. We certainly are looking at alternate catheter form factors. And sort of as you mentioned, there are a lot of different things that you can do with pulse field energy and with the Farawave platform or Farapulse platform. I do think it's important, though, as you think through that to think through the different use cases. And so for atrial fibrillation, whether it's paroxysmal atrial fibrillation, where really the goal of therapy is just pulmonary vein isolation or whether it's persistent atrial fibrillation where you may very well need to go beyond that, do pulmonary vein isolation plus posterior wall isolation, which we're investigating right now in our ADVANTAGE trial. And as Mike noted in his prepared remarks, we've already begun enrollment in that trial and really our -- I'd say, beyond pleased, at the excitement at the rate at which we're enrolling in that trial. When you think about both of those use cases, right, it's our belief -- and in fact, the data that you've seen from things like Manifest supports that belief that the Farawave catheter itself is uniquely well suited among all the competing technologies for achieving those goals. So again, when you think about AF ablation, right, we think that the Farawave catheter is the best of the catheter form factors out there. And then when you couple that with the waveform that we deliver, when you couple that with the dosing protocol that we've optimized over the many years of preclinical and clinical research that Farapulse did and that we've continued since the acquisition, we are really satisfied with that as the catheter that's going to be preferred for AFib ablation. And then it's adding on like some of these other form factors that you talk about as we think about some of the smaller use cases beyond the AFib market.

Our next question comes from Travis Steed from Bank of America.

I guess high level, maybe you could just refresh us on your overall capital allocation priorities and start there. And then a quick question on the guidance. Revenue growth obviously moved up quite a bit, but earnings didn't move up quite as much. So I just want to make sure I'm not missing something on the EPS side given that margins are staying the same.

Sure, Travis. I think I can probably take both of those. Capital allocation priorities remain unchanged. It's been an equation that's worked well for us for many years here relative to capital allocation. So first priority is high-quality tuck-in adjacent type growth M&A. And Mike just gave you a couple of examples of those that we've closed this year. And then we fill in on the back with any excess cash for share repurchase. And as you know, obviously don't pay dividend this time. So I think that's clear. With respect to the drop-through in the quarter, as I look at it, we kind of beat the midpoint of the range and the consensus by $200 million. You drop that through at our overall margin percentage and you get to about $0.02 to $0.03 of additional adjusted EPS, you would have expected. We delivered 3.5%. I think that's kind of in that range. We're at 25.5% adjusted operating margin. I think that puts us right in place to achieve that 26.4% for the year. So I think all is well relative to the margin profile. And the 26.4%, again, it would be 80 basis points on top of last year, which I think gives us a bit of a differentiated expansion versus our peer set.

Our next question comes from Vijay Kumar from Evercore.

Congrats on the [ printing ]. I had a two-part, one on product and one on capital allocation. On the product side, PFA, Mike, did I hear you correctly on the prior question on Farapulse. Can you do point-by-point ablation at this point? I thought it was a single-shot catheter, but I would be curious to know if you have -- if it can do point-by-point ablation and are you gaining share in the RF side as well in the current market? And then on the capital allocation side, I know you're not going to comment on market speculation. So this is not related to market speculation, but can you just remind us, in current interest rate environment, what kind of leverage levels would Boston be comfortable with? And if Boston deems a deal as strategic, would you be okay doing an earnings dilutive deal?

Vijay, it's Ken. Let me start with a question about Farapulse and Farawave and really answer in two parts, right? So the first part, so the current catheter that we have approved in the CE Mark countries and as Mike said, in Singapore, and that we're evaluating the U.S. in the Advent trial, is a "single-shot catheter". So it's not a point-by-point ablation catheter. And as I said to Larry, it's a catheter form factor that really is uniquely well suited for pulmonary vein isolation and for posterior wall isolation. And again, we firmly believe that this is the best form factor out there than for tackling the vast majority of patients are undergoing atrial fibrillation ablation. Now having said that, and I think sort of the proof behind that is when you look at our commercial release in Europe, we are taking share both from centers that were "single-shot centers", so the cryo users, but also taking share from folks who were very well known in the field for their point-by-point RF ablation. I'd say we've really been impressed and pleased at the way we're converting folks who were point-by-point users into PFA and that's based on the safety, based on the efficacy and also, frankly, based on the efficiency of ablation with Farawave.

And then relative to your specific question on leverage, I'd say it's been a focused and intentional journey for us to get back to BBB+ with all three rating agencies that rate us. And very comfortable there, obviously committed to investment grade and comfortable at that BBB+ rating.

Sorry, on earnings dilution, Dan, would you be consider an earnings dilutive deal if Boston deems it as strategic?

I wouldn't comment on specific dilution and this and that. I think from our perspective, relative to the M&A environment. We're committed to looking at deals that are high growth and tuck-in acquisitions as we've done.

And our next question comes from Danielle Antalffy from UBS.

And congrats on a really strong quarter. Just a question on Farapulse. Sorry, there's so much focus on this one product on the call. But I'm curious about how you guys are thinking about the evolution of the market probably. I mean this has been a market that AF ablation market that's been double-digit grower for the last decade plus. But is it right to think about Farapulse and just the advent of pulse sales ablation overall is potentially accelerating market growth in a meaningfully and sustainable way because of the safety profile of the device? Or how are you thinking about -- and what are you seeing, I guess, in Europe about market growth overall for this device? And I have one follow-up on Watchman.

Yes. Sure, Danielle. I guess I'll take that first one, and we'll see on the follow-up. I mean the easy answer to what your question was, is yes. We do see Farapulse accelerating adoption of AF ablation. AF, right, is the most common sustained arrhythmia that's seen globally. In fact, ablation today for current indications is still very much underpenetrated. It's underpenetrated for a couple of reasons, right? And one is safety concerns around the procedure. One is just the skill level and the relative inefficiency of AF ablations today using thermal energy. So I think, first of all, with the Farapulse system with Farawave and again, the safety the efficacy and the procedural efficiency, I think it's going to pull more people in who are currently indicated. And then also believe that there's a real opportunity to drive further use of this, the patients with persistent atrial fibrillation, where frankly, conventional thermal ablation results are marginal at best. And it's one of the reasons we're so excited about the ADVANTAGE trial that we recently began enrollment in the United States, which is aimed at getting approval and indication for Farawave for persistent atrial fibrillation as well as paroxysmal atrial fibrillation.

Okay. And then my question on Watchman is just really around -- on a similar vein, sort of what we're seeing from a market growth perspective there because really strong numbers. Hard to parse out what backlog, what's underlying growth but it's been growing quite helpfully for a while with a competitor launching in the U.S. Just curious what you're seeing from a market growth acceleration perspective on Watchman?

Sure. I would say we call the market 25-percent-ish growth. So very, very strong as it continues to get more and more scale. I think it's important to note that we believe our share is maintained at least flat, if not actually increased over the past 6 months. So our teams in the U.S. have done a very, very excellent job commercially with the Watchman FLX product. So we continue to see this to be a plus 20%, 25% market grower for a number of years here. And then we have these very groundbreaking trials with Option, with CHAMPION, and we just highlighted [ LOUS 4 ], which will follow those. So we're very committed to the market developments of this category and expanding the indication over time through these clinical trials, assuming that they're positive. And I think just as importantly, we look to continue that momentum with our product cadence. We have a differentiated steerable sheath that will be approved in the coming 9 months. And then our third generation Watchman product which should be launching kind of around this time next year or first quarter next year. So we've got the portfolio and the clinical work to continue to expand the market, and the team is doing an excellent job globally.

Our next question comes from Cecilia Furlong from Morgan Stanley.

And also, echoing my congrats on the quarter. I wanted to ask specifically just your comments on pain and SCS. Really what you saw in the quarter, especially as it pertains to recent headwinds [indiscernible]? And then just your outlook in terms of underlying market growth, do we see some recapture in 1Q? Was that part of the strength? And how you're thinking about underlying market growth going forward?

Sure. In the first quarter, we did see an improvement out of that global business. The overall business grew 14%, led by our deep brain simulation business, had a terrific quarter. And spinal cord's tended fine, about 9%. So in the quarter, there definitely was some improvement in staffing which likely helped the entire market and the Neuromod business. And as we said, there are some slightly favorable comps as well in the quarter comparing to the '21, the COVID year. But overall, we expect that business and the pain size to grow above market and the brain side, DBS, significantly above market. And we're very excited about this new STIMVIEW capability. The one challenge with that deep brain stimulation, it's an excellent procedure, but it's -- it takes quite a bit of time and a lot of coordination between neurologists, implanting physicians, the patient, and we believe the software enhancement will continue to improve the productivity and cycle time for patients. So overall, I think it's too early to call what we think the market will be for spinal cord stim for the full year. We still would say maybe mid-single digits kind of 5%, 6% is where we would land if you force us to give you a number now.

Great. And if I could just quickly follow up on China. Some of your comments, what you saw in the quarter coming in ahead of expectations. How should we think about really just the rest of the '23 in terms of pent-up demand, backlog procedures and then also what you've seen to date with Watchman in the region?

Yes. China catches up to everything quickly. So there was an impact early in the quarter with COVID procedures, and they clogged that back very quickly in the second half of the quarter. So we do expect double-digit growth in China despite some of the pricing pressure consistent with previous years, really based on the strength of the overall portfolio there and continuing to expand our capabilities. We're excited about this Acotec agreements where we own 60% of Acotec, which is a local China company that's the leader in drug-coated balloons in the region as well as many other peripheral and potentially cardiology procedures. So we think that strategic alliance will also help us and help them and we continue to expect double-digit growth in China. And Watchman, I have the exact numbers. Doing fine in China and we can provide more details in the future. But that FLX is approved, I believe, isn't it?

Yes, and good quarter.

Our next question comes from Matt Taylor from Jefferies.

So great result. I guess what I'm struggling to understand is, obviously, you saw strong demand in the quarter. And I think we're seeing a lot of macro things improving like staffing, et cetera. I mean could it actually theoretically get better sequentially? Or why are we thinking so conservatively? Do you think that the direction of travel could be positive, negative or neutral? And what are some of the background thoughts that you would base that on?

Well, I would say, again, we're super proud of the quarter. We exceeded, we believe, the peer group and did well across every region. I won't go through every one. And we do think there are -- despite it being a 9.7% comp, again, it's off of a lighter '21. So we do think there is some comp benefit there despite it showing a 9.7% if you look at the number. But that doesn't take away from the excellent performance in the quarter overall as you compare to our peers. So I just think it would be not prudent for us to assume the same market growth for the remainder of the year when traditionally, this has been a, call it, 6.5% markets that we serve in. And over time, you're going to see that served market growth continue to expand like we have every couple of years based on our portfolio. So to say that the market's kind of jumped from 6% to 10% over the last 6 months probably isn't feasible. So we think that the markets are healthy. We still think the market's growth is kind of 6% to 7% where we serve. And those will hopefully increase over time as our strategy continues to play out, but it's too soon to call the first quarter performance for the market lapping every quarter.

Yes. And then, Mike, just a follow-up on that. I mean, thinking ahead to 2024, if we do have some, let's call it, super normal growth this year, some catch-up or whatever, do you still think that you can grow in kind of the LRP range in 2024 over what could be a tough comp in 2023 if things play out well?

I would attend our Investor Day. We'll give you a sense then of what we think the LRP is for '24, '25 and '26. We'll see how this year plays out over the next few quarters. But I would imagine, as we have at prior Investor Days, we'll give you a good sense there about what we think the next 3 years look like.

And our next question comes from Matt Miksic from Barclays.

So a question for Dan. And then just a couple of follow-ups on some of the product lines here we haven't yet talked about so much on the call. So for Dan, free cash flow conversion. Could you talk maybe a little bit about where you're at now, where you want to be and what some of the challenges are currently, supply chain or whatever else has been more challenging and how you're kind of tackling those? And as I mentioned, I just have one other follow-up.

Sure. I think I would say I'm not where I want to be yet on free cash flow conversion. It's a key focus item for us. Some things are structural and some are probably a bit more transient and focused on working capital. The foundational ones are as an acquisitive company, and we're going to continue, obviously, over time to be acquiring companies. We're going to have integration costs. So that's a cost that kind of gets in the way of free cash flow conversion. We have had in the past, we've had litigation challenges. I think those are waning over time here. That's a good thing. So that's one less thing that will get in the way of that. We have restructuring as well. So restructuring charges, I think good hygiene of a company to continue to drive out continuous improvement and drive out unnecessary costs. So I think those are still going to be there. So from a foundational perspective, those are a bit challenging relative to the difference between operating cash flow and adjusted cash flow. On the working capital side, the things that we really focus on there relative to receivables and payables, inventory, have a real maniacal focus inside the company to continue to make those -- continue to be in our favor. So some things are structural relative to how the differences between operational and adjusted free cash flow. Others have our focus. But the takeaway is, we are probably not where I want to be, but focused on improving that over time.

Great. And then maybe a follow-up for Mike. So Interventional Oncology, we talk to clinicians that business just seems to be growing at very healthy kind of rates in these centers. So just any quick color or comment on what Obsidio could mean to that business? And then similarly, stone management, very strong. Maybe if you could talk a little bit about how the Lumines acquisition is kind of dovetailing there and what the impact of this new single-use scope could be to the LithoVue Elite?

Yes, Matt, thank you, first of all, for bringing up these other businesses that are over $2 billion and growing very fast and accretive to our margin profile overall. Farapulse, we love, but sometimes it drowns out everything else we're doing as a company. . On PI, Interventional Oncology, so pleased with overall that BTG acquisition after we -- it's been integrated very well. Jeff Mirviss, Peter Patt and the team do a really nice job with that. We continue to take core share with Y90. The cryo product that we have has been a surprise for us, does extremely well globally. And this Obsidio should be, again, another differentiated product to round out that portfolio even further. It just speaks to the category leadership focus that we have as a company. So we're very well positioned from a portfolio standpoint. The team is also pushing for new clinical indications. It's very early. They won't be impacted in the LRP, but we think Y90 and other therapies can be used outside their current indications, and we hope to prove that through our clinical science over the coming 5 years. So we want to invest long term there. So we see a bright future overall for Interventional Oncology, and we're positioned well. And the same goes for the -- similar words, although be it different products for urology. We're the clear global leader here. The team has taken LithoVue, the single-use scope and pioneered that and really want to continue to pioneer that industry and tie in our pressure sensor, other AI algorithms and fluid management to create a smarter, more efficient system that's more productive for the doctor and the staff and have better outcomes for patients. So we call that StoneSmart and that's a multiyear journey that the team continues to execute well on. So I think that differentiated product as well as the other key components of that urology business make Boston really a preferred partner for most customers. We have to earn that every day with our clinical people and our smart contracting, but we have a very robust portfolio to serve that call point.

And our final question today comes from Chris Pasquale from Nephron.

And sorry, Mike, but I'm going to go back to Farapulse real quick here to finish up. Just and I want to ask a couple of follow-ups on the MANIFEST study. First, do you think 80% efficacy in paroxysmal patients is a realistic goal for Advent? Or should we keep in mind any important differences in endpoints or trial design? And then second, I was struck by the relatively low use of mapping in Europe today. How important do you think Rhythmia integration is to the long-term outlook of Farapulse? And how are you thinking about the regulatory pathway and timing to achieve that?

Yes, Chris. I'll take MANIFEST first and then say a few words about where we think we need to be in terms of mapping. And so I mean, as you said in the question, there were some very important differences in trial design between our Advent study and what you saw in MANIFEST. And some towards the positive, some towards the negative. There are differences actual definition of endpoints. So in MANIFEST, that 80% number that you cite allowed for patients to still be on previously an effective antiarrhythmic drug over the course of the year that would not count as a success in Advent. And the actual -- just the monitoring strategy in Advent is a lot more intensive than it was in a registry like MANIFEST. On the other hand of that is that MANIFEST is the first broad rollout and real-world commercial experience as opposed to just going to some highly selected clinical trial sites. I think what I'd urge on Advent, really the importance is the comparison in the randomized trial against thermal ablation techniques. The trial, right, is designed as a non-inferiority trial. We would have had to design a much larger trial to be able to use superiority as a primary endpoint, although if we hit non-inferiority, we're allowed to test for superiority. But really, the goal in Advent is, again, to get regulatory approval based on non-inferiority versus thermal techniques. And then let's look at a real-world use. Let's see if we can duplicate results like the MANIFEST results in the United States. On mapping, I think we anticipate in the United States, we'll see more use of mapping than we see in Europe for the obvious economic reasons. Having said that, right, for paroxysmal Afib, where you're just doing pulmonary vein isolation, it's pretty clear that you don't have the map to have a successful procedure with Farapulse and the MANIFEST results speak for themselves in that regard. And I'd expect things to split out pretty much the same way they do with Cryoablation. When you go beyond that, though, I think there will be more of a tendency to want to map those cases. And so we will have a second-generation Farawave catheter that will be integrated with the RHYTHMIA system, but we're never going to force people to use Rhythmia. We're always going to maintain it as an open system. You can map with whatever system you want, although we believe with some of the enhancements we're going to bring out, it's going to drive a lot of folks to want to use Rhythmia when they want to map Farawave case.

Thank you, Dr. Stein, and thank you for joining us today. We appreciate your interest in Boston Scientific. If we are unable to get to your question or if you have any follow-up, please don't hesitate to reach out the Investor Relations team. Before you disconnect, Jamie will give you all of the pertinent details for the replay.

And ladies and gentlemen, that will conclude today's conference call and presentation. To join the replay, we do -- we will have it up within the next 2 hours. The conference ID would be 2742311. [Operator Instructions] The dial-in numbers would be 8 (187) 7344-7529 or 1 (412) 317-0088. The replay will be available until May 3, 2023 at 11:59 p.m. Eastern Time. Once again, today's conference is concluded. Thank you for attending. You may now disconnect.